Question

Business Law FACTS: Jerry Maguire is an at-will employee of Sports Management, Inc. (“SMI”) and represents 100 of the 1500 clients the agency has. Mr. Maguire authors a publishing that he believes is a “mission statement” but is considered a “memorandum” suggesting that the business needs to be “smaller, fewer clients, less money, more personal attention.” Mr. Maguire is terminated seven days after presenting the writings to the entire agency. In the seven days before Mr. Maguire was terminated, Bob Sugar contacted all of Mr. Maguire’s 100 clients to have the clients terminate Mr. Maguire as their agent and/or representative and sign with SMI. On the date that Mr. Maguire was terminated by SMI, he learned that Mr. Sugar had been in contact with his clients and when he spoke to each client, 98 of them informed Mr. Maguire that they would stay with SMI, 1 (Frank Cushman) was unavailable by phone, and 1, Rod Tidwell, stated he would keep Mr. Maguire as his agent. Mr. Maguire flies to Texas to Matt Cushman’s house, i.e. Frank’s father, to meet in person to keep Frank Cushman as a client. When Mr. Maguire arrived, Matt informed Mr. Maguire that they were keeping Mr. Maguire as Frank’s agent. Matt informed Mr. Maguire that he “doesn’t do contracts, but what you have is my word, and its more solid than oak.” Frank Cushman is the top draft prospect destined to be the top pick by either San Diego or Denver. Matt wants Frank to play in Denver. Mr. Maguire attends all the pre-draft events as Frank’s agent and has begun negotiating with both San Diego and Denver. Mr. Maguire takes an hour break to give attention to Mr. Tidwell, who also attended the pre-draft events for publicity. During the hour break, Mr. Sugar meets with Matt Cushman and informs him that Denver does not want to work with Mr. Maguire. Frank Cushman signs a written contract with Mr. Sugar and SMI. Mr. Maguire learns of the written contract between Frank and Mr. Sugar and is no longer the agent of Frank Cushman, who is drafted first overall the next day. You have been hired to represent the legal interests of Mr. Maguire? What actions do you take on Mr. Maguire’s behalf? (Note: Breach of Contract, Intentional Interference with Contract have been discussed in class).

Answer 1

Overview:

Jerry Maguire an employee of SMI (Sports Management, Inc), he handles 100 clients of the agency. He is terminated due to a difference of opinion with the organization. He decides to go independent and contact all his 100 clients, he realizes that Bob Sugar has been in touch with all his clients and 98 had agreed to stay with SMI. The balance Two clients, Rod Tidwell agreed to stay with Maguire, He travels to meet the other client Frank Cushman’s father Matt who verbally agreed to retain Maguire as their agent. He also stated that he would not make a written contract but his “words were more solid than oak.” Maguire starts representing Franck Cushman as an agent and begins pre-draft negotiations with two top teams San Diego and Denver on his behalf.

He goes to meet Rod Tidwell for an hour as he is also there for the pre-draft events. During this period Bob sugar signs a written contract with Frank Cushman and SMI, Maguire is informed he is longer the agent for Frank Cushman.

You have been hired to represent the legal interests of Mr. Maguire? What actions do you take on Mr. Maguire’s behalf?

As the legal representative for Maguire, I would initiate a case for breach of contract as following was already agreed/ understood between the two parties:

• All parties namely Maguire, Matt and Frank in the agreement were in their senses and above the legal age i.e. 18 years when the agreement was made though verbally.
• The contract was made with the consent of all the parties. There was no pressure or fraud or unnecessary influence used to make the contract. There was a” meeting of minds” in this case. Mr. Cushman had agreed that Maguire could represent Frank as his agent and would be paid a commission as agreed between them.
• Maguire had also agreed to represent Frank and negotiate the best deal for him from Denver or San Diego. He had also initiated and started the negotiations.
• Maguire’s offer to represent Frank had been accepted by The Cushman’s though verbally.
• The payment terms of Maguire had also been discussed and finalized as a percentage of the Cushman’s contract, bonus, signing amount.

As all above indicate a legally binding contract between the two parties, although verbal. Also, the Cushman’s had not terminated the contract with Maguire before signing the contract with Bob Sugar.

As his legal representative, I would file a breach of contract “Which states that agreed terms of the contract were not honored and bargained for exchange has not been honored” and sue them for:

• Compensatory Damages:   These are damages to cover his loss in commission and pay for the income Maguire was expected to earn in case the contract was continued. This includes the percentage of commission earned by Frank. I can also sue for damages for his apparent loss of business due to assigning the time to Frank and not able to pursue any other parallel activity.
• Wrongful interference or tortious interference: I would sue Bob Sugar, SMI for intentional interference in the breach of contract between my client Maguire and Franck Cushman. I would sue him for compensating the apparent business loss and to cover damages to the amount of expected income from the contract, as it had caused economic harm to my client.