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Keyghobad v. Home Box Office Inc.

California Court of Appeals, Second District, Eighth Division
May 6, 2008
No. B194997 (Cal. Ct. App. May. 6, 2008)

Opinion

NOT TO BE PUBLISHED

APPEAL from a judgment of the Superior Court of Los Angeles County No. BC 291452 Jon M. Mayeda, Judge.

Sigelman Law Firm and Paul S. Sigelman for Plaintiff and Appellant.

Arent Fox, Robert C. O’Brien and Roy Z. Silva for Defendant and Respondent.


FLIER, J.

Robert Keyghobad, an aspiring producer, appeals from the grant of summary judgment to respondent Home Box Office, Inc. (HBO), on his action for fraud, breach of contract and intentional and negligent inducement to breach an alleged contract. Appellant alleged HBO conspired with others to shut him out as a producer of a project he discovered and developed for a television series, entitled “Carnivale” (Carnivale or show).

This is the second time this case has been before the court. We previously affirmed the trial court’s order vacating dismissal of appellant’s action based on the excusable neglect of his attorney in failing to timely file an amended complaint. (See Code Civ. Proc., § 473, subd. (b); case No. B174854.) Upon remand, HBO moved for summary judgment or, alternatively, summary adjudication, asserting there was no triable issue of fact of any promise to employ appellant for any fixed period, nor evidence third parties had breached any contract with appellant. The trial court agreed and entered a summary judgment for HBO. On appeal, appellant contends his causes of action for fraud, breach of contract and interference are supported by admissions by HBO’s employees and evidence presenting questions of fact. HBO counters that appellant’s own deposition admissions unambiguously preclude any claim he was guaranteed a working role on the show or that third parties were induced to breach any contract with appellant. Finding no triable issue of any material fact, we affirm.

FACTS

Carnivale was a story conceived by screenwriter Daniel Knauf, who posted a teleplay of it on his website. In 1999, appellant was employed by Twilight Time Films, a company owned by Scott Winant, a freelance writer and producer, and his partner, Kelly McCarthy. Appellant was Winant’s assistant. Among appellant’s job duties was finding material that Winant might be interested in directing or producing. While looking for such material on the internet, appellant came across Knauf’s website and read his screenplay for Carnivale. Appellant told Winant about the screenplay.

At Winant’s suggestion, appellant approached Knauf, who agreed to give Winant, McCarthy and appellant an exclusive option to “pitch” the show to third parties. An initial option contract was executed in September 1999 among Knauf, Winant, McCarthy and appellant. A second option contract (option contract) was executed in March 2000, which, for reasons not germane here, deleted Winant as a contracting party.

The option contract provided that each of the parties would be “attached” to the Carnivale project as producers if a third party decided to finance the show. The option contract did not guarantee that the parties would receive any particular amount of compensation as “producers,” nor did it specify the services they might be required to perform or whether they would have any creative participation in the show. Under the option contract, each party was left to negotiate the terms of his or her contract directly with the financing party. However, each had to give consent for the show to be produced.

Paragraph 2 of the option contract stated, “each of the parties hereto shall individually negotiate the terms of his or hers respective agreement with such third party. In this connection, [appellant] and McCarthy shall have full and complete approval over their respective producing services and the terms of the agreements for such services. Similarly, [Knauf] shall have full and complete approval over the disposition of the Property and the writing services, if any, to be rendered by [Knauf] and the terms of the agreement(s) for such disposition and services.”

In February 2000, Winant and his colleagues, including Keyghobad, “pitched” Carnivale to HBO’s executives. After that meeting, HBO decided to finance the show’s development. HBO began negotiating individual “producer” contracts with Winant, Winant’s manager, McCarthy and Knauf, but not with appellant.

In approximately June 2000, Winant informed HBO for the first time that he had an agreement to “attach” appellant to the show. Winant asked HBO to include appellant in HBO’s negotiations. Accordingly, in June 2000, Beth White, HBO’s vice president of business affairs, telephoned appellant and made him an offer consisting of three deal points: (1) on-screen “co-producer” credit for the pilot episode and each episode on which he actually performed services; (2) a flat fee of $12,000 for work on the pilot episode; and (3) a payment of $7,500 ($8,000 if there was a second season) for each episode actually produced by HBO. Appellant immediately accepted those terms. This oral agreement is the basis for appellant’s claims against HBO in this action.

Appellant concedes by the time of his deposition HBO had tendered (but appellant rejected) all payments called for under this arrangement, including interest. Appellant did not allege in his operative complaint that HBO failed to pay the amounts promised under the alleged agreement.

White designated a member of HBO’s legal department, Sylvia Smith, to prepare a formal written agreement with appellant. In August 2000, Smith sent appellant a “Memorandum of Agreement” memorializing his engagement. Appellant requested revisions, and, for the next year and a half, appellant and White exchanged multiple drafts of the agreement, which ultimately was never signed.

The memorandum of agreement, dated “[a]s of July 25, 2000,” confirmed the agreement between HBO and appellant. It provided that appellant would immediately assign any and all of his rights in Carnivale and that HBO agreed to engage appellant to render “occasional development services” for the pilot on a nonexclusive basis “from the date hereof through the end of . . . HBO’s designated development period.” The memorandum of agreement further provided that if HBO proceeded with production of the pilot, appellant “shall be engaged on a pay-or-play basis (subject to applicable events of default, disability, death and force majeure) as a co-producer (non-writing)” on the pilot, for which he would receive $12,000, payable upon the completion of certain events. (First italics added.) The agreement additionally provided that if HBO proceeded to production of a series, appellant “shall be engaged on a pay-or-play basis” as a “Co-Producer (non-writing),” subject to the same limitations regarding default and other events as with the pilot. (Italics added.) The draft stated that appellant would receive $7,500 for each new episode for which appellant rendered and completed coproducer services during the first year and $8,000 for each episode during the second year if HBO exercised an option for the second year. Provision was also made for appellant to receive screen credit as a “Co-Producer” on a separate card “in the main titles, on the Pilot and each applicable episode for which [appellant] actually renders and completes Co-Producer services.”

In March 2001, appellant signed and returned to HBO a “Certificate of Engagement” acknowledging he was an “employee-for-hire” of HBO.

After his conversation with White in June 2000, appellant and his coproducers (i.e., Winant, McCarthy and Knauf) immediately began working on the development phase of the show. During preproduction and production of the pilot episode, appellant was given an office on HBO’s lot and participated in meetings and creative decisions regarding the pilot show. Appellant worked on the development, preproduction and production of that show for about two years and received a fee of $12,000 and onscreen credit for the pilot.

After the pilot episode was completed, HBO decided to forego the services of McCarthy, Knauf and appellant. HBO continued to pay each his or her agreed-upon fee per episode and to provide onscreen credit as called for under their respective agreements. Appellant alone objected to HBO’s decision.

PROCEDURAL HISTORY

Appellant filed this action against HBO in March 2003. His third amended complaint asserted claims for fraud by false promise, breach of contract, induced breach of contract and negligent interference with contract. Appellant alleged that White and in-house counsel Smith represented to him that he was going to be a “working co-producer” on the show.

Appellant claimed HBO agreed he would have a working relationship as a co-producer on preproduction, production, and postproduction of the show for each episode of the series. Appellant alleged he and HBO, through White, entered into an oral contract in June 2000. He further alleged HBO caused Knauf and McCarthy to breach their option contract with appellant.

After remand from the first appeal, HBO moved for summary judgment or, in the alternative, summary adjudication, on all causes of action in the third amended complaint. In support of its motion, HBO primarily relied on admissions that appellant made during discovery.

At deposition and in his discovery responses, appellant admitted White and Smith were the only employees of HBO with whom he negotiated his terms of employment. He essentially admitted that neither White nor Smith had ever told him he would work on the show permanently or for any specified length of time.

Specifically, appellant testified he knew that “pay or play” was the standard practice in Hollywood. He testified that during his June 2000 conversation with White, White had offered him a co-producer credit and certain payments for each episode of Carnivale that was produced. Appellant admitted White did not offer him anything else. Appellant was asked, “In the deal points that [White] talked to you about . . ., did you talk about credit or did you talk about just having the position of being a coproducer?” Appellant replied, “No, this is what she offered me. I didn’t really talk about what I wanted.” (Italics added.) He further stated, “As far as my day-to-day job function, that[ was] not defined.” (Italics added.)

Appellant testified, “when we say coproducer, we don’t mean it literally, we mean creditwise. [¶] . . . Her offer was for the coproducer credit.” (Italics added.)

Appellant was closely questioned on this point at his deposition:

“Q Did you believe when you finished that phone call with Ms. White in June of 2000, that you had a contract at that time with HBO?

“A Did I believe that I had a contract?

“Q Yes.

“A It was an offer. . . . [Y]ou have an agreement in principle, when someone says that I’m going to do this for you, then that’s an offer.

“Q Did you accept the offer in that phone call?

“A Yeah. I didn’t even counter.

“Q Okay. So you accepted -- you accepted the coproducer, the 12,000, the 7500 per episode in year one and the 8,000 in year two?

“A Yes.

“Q And so you felt that those -- that those terms -- as of that time you had a deal, as to those terms?

“A To the specific terms that she outlined

“Q Right.

“A -- yes.” (Italics added.)

Appellant expressly acknowledged that White’s offer did not include any waiver or modification of the general industry practice of “pay or play.” HBO’s counsel asked, “So [White] didn’t make any sort of promise that you -- she didn’t promise you, A, that the show would go for two years, did she?” Appellant responded, “No, she can’t do that. She couldn’t even promise me that the pilot was going to go and that’s the risk you take when you get into this field.” To be certain of appellant’s position, counsel returned to the subject, asking, “And she didn’t promise you that you wouldn’t be pay or played at some point, did she?” Appellant replied, “That wasn’t an issue that even came up.” (Italics added.) Appellant later explained, “I’m just telling you in the conversation that did not come up.”

Both White and Smith executed declarations in support of the summary judgment motion. White declared she had authority only to negotiate contracts on a “pay or play” basis and, in 11 years of working for HBO, she had never been involved in negotiating a contract with “talent” in which HBO waived the “pay-or-play” provision. Smith declared that, during the six years that she had worked for HBO, no person or his or her attorney “has ever so much as requested that the person be employed on anything other than a pay-or-play basis.” Appellant testified at deposition that he had never personally seen a contract between a studio and an artist without a “pay-or-play” provision.

Counsel then inquired, “[Y]ou’re not alleging in this lawsuit that somehow that she told you in that meeting that you would -- that you would not have pay or play and that you would just -- you would be guaranteed work for HBO for two years?” Appellant repeated, “Once again, the pay-or-play issue did not come up in that conversation.” (Italics added.)

Appellant volunteered that, after he and White had reached an oral agreement regarding his employment, she “went on to say this is going to be a great thing for you, we know you want to get going and establish yourself a career and that’s what we’re going to offer you here.”

According to appellant, he never again spoke to White regarding the terms of his contract until nearly two years later, in approximately April 2002, by which time he had been removed from the show. Appellant testified that he had no other communications with White concerning the duration of his working relationship with HBO.

Appellant testified that, following his June 2000 conversations with White, he received the draft agreement from Smith in August 2000. He then telephoned Smith to discuss the draft agreement. He brought up two issues with Smith that he said had “immediately sparked” his attention. One of those issues was the “pay-or-play” provision. The second issue concerned a “two-year lock.”

Appellant testified that he did not object to the “pay-or-play” provision but simply asked Smith about it. Smith told appellant that the “pay-or-play” provision was “precedent-setting language” that “can not change and will not change.” However, according to appellant’s account of the conversation, Smith told him “it is nothing to worry about” and “if I’m going to be working on the show, I’m going to be working on the show.” (Italics added.)

Defense counsel then asked, “[a]nd so she [i.e., Smith] told you pretty much flat out that [it] wasn’t going to be changed, the pay[-]or[-]play [provision], correct?” Appellant responded, “Correct.” He asserted, “She told me it wasn’t an issue because I’m going to be working on the show.” Counsel asked, “But she wasn’t going to change it in the contract, correct?” Appellant answered, “She told me she couldn’t because it was precedent setting for them.” Further on, he repeated, “I can only tell you that she said she could not and would not based on it being a precedent-setting issue for them.” Counsel inquired, “Did you tell her at that time that you would not go forward with the project unless it was changed?” Appellant replied, “There was no reason to tell her that.”

This testimony directly refuted the allegation in appellant’s third amended complaint that, as of the date he learned his services were no longer required for the series, “[n]o . . . ‘pay-or-play’ term had been discussed with [appellant].”

Appellant admitted he never struck out the “pay-or-play” provision in any of the redlined draft agreements he returned to Smith. He also acknowledged that HBO declined to change the “pay-or-play” provision and never informed him, either orally or in writing, that it would waive the provision.

Regarding the second issue, appellant told Smith the draft agreement did not have a “two-year lock.” Smith told appellant she was unaware of that provision and would have to verify that with White. Later, after confirming the term with White, Smith modified the draft agreement to provide for a “two-year lock.” Appellant had already testified the “two-year lock” was the guaranteed payment he was to receive if HBO opted to do the show for two years.

In response to an earlier inquiry about his discussions with White concerning “a two-year deal and credit for two years,” appellant had explained: “That’s why I have a two-year lock. That’s what a two-year deal is, when you say your first series year is 7500 and your second year is 8,000, it’s called a two-year lock.” (Italics added.)

As to the option contract, appellant testified at deposition he did not believe either Knauf or McCarthy ever violated the contract. He was asked, “do you believe that Ms. McCarthy or Mr. Knauf have violated any of their obligations to you under the March 26th, 2000 agreement?” He responded, “as to what they kn[e]w what was done or was not done, I’m assuming they thought the deal was done and therefore probably not, no.” (Italics added.) Counsel asked, “As far as this agreement . . ., you haven’t instituted arbitration against Mr. Knauf or Ms. McCarthy, correct?” Appellant answered, “That is correct.” Counsel continued, “And you haven’t given them notice of any default or breach of this agreement, correct?” To which appellant replied, “That is correct.” He also testified that neither McCarthy nor Knauf had breached any obligation owed to him under the option contract to his knowledge “[a]t this point in time.”

The option agreement provided, “All disputes which may arise between [appellant], McCarthy and [Knauf] under or with respect to this Agreement will be determined solely by arbitration . . . .”

HBO originally set another session of appellant’s deposition but later indicated it saw no need to question appellant further. The motion for summary judgment or adjudication followed, based on appellant’s admissions.

Two months after his deposition, appellant served on HBO a document entitled “Additional Deposition Testimony” that purported to “clarify” and “complete” his prior deposition testimony. The declaration stated that appellant had been promised a “ ‘creative working relationship’ ” on the show. However, appellant neither cited nor offered evidence to support this conclusion and did not identify the persons who purportedly spoke on HBO’s behalf. The declaration did not mention White or Smith, nor did it claim that either made appellant any promises concerning the duration of his work on the show.

Appellant opposed the summary judgment motion. Contradicting his own deposition testimony, he contended he was induced to enter an oral contract by HBO’s agreement that (1) he would not be terminated for a minimum two-year period; and (2) he would enjoy creative participation during that period, in addition to screen credit.

Appellant’s declaration in opposition to the summary judgment motion asserted that White had represented he would have “an actual day-to-day creative working relationship” on the show. Contradicting his prior deposition testimony, this second declaration declared: “During my initial conversation with Beth White, and each conversation thereafter, she never mentioned a pay-or-play provision or option. Not a word. There was no need for us to discuss it, as she had already represented to me that I would be actually working on the show with a 2 year lock . . . as a creative producer.” (Italics added.) Appellant also changed his testimony as to what Smith had told him from “if I’m going to be working on the show, I’m going to be working on the show” to “if I was told I would be working on the show, I would be working on the show.” (Italics added.)

Based on HBO’s showing, the court granted the motion for summary judgment. The court found that, other than appellant’s declarations which contradicted his earlier deposition testimony, appellant had failed to produce any evidence to create any triable issues of material fact as to whether HBO promised him continued employment. The court also observed appellant had no evidence to raise a triable issue of fact as to whether Knauf or McCarthy breached their option contract.

Appellant moved for reconsideration on the ground that the “true” (and preexisting) evidence and circumstances were not before the court when it granted the summary judgment. The court denied the motion for reconsideration.

At appellant’s request, the court issued an order granting summary judgment setting forth the undisputed facts. Among other things, the court found it undisputed that: HBO’s standard practice is to hire individuals only on a “pay-or-play” basis; appellant was aware “pay or play” was the prevailing practice in the entertainment industry; White never promised appellant that HBO would use his services on the show for any specified length of time, nor did she promise that HBO would not exercise its right to “pay or play” appellant during the show’s production or that appellant would work on Carnivale for the life of the show; and appellant accepted the terms offered by White without proposing any modification or alteration to those terms. The court further found there was no dispute that Smith expressly told appellant the “pay-or-play” provision in appellant’s contract with HBO “cannot change and will not change.” The court found it also undisputed that the terms of the oral contract between appellant and HBO did not include any term regarding the duration of appellant’s work on the show, did not guarantee appellant would work on Carnivale throughout the life of the show and did not guarantee that HBO would not exercise its right to “pay or play” appellant at some point during the production. The court also found no evidence to dispute that appellant was unaware of any breach of the option contract by Knauf or McCarthy.

Appellant filed a notice of appeal, and the court thereafter entered judgment. We deem the appeal to have been timely filed immediately after entry of judgment. (See Cal. Rules of Court, rule 8.104(e)(2).)

STANDARD OF REVIEW

Code of Civil Procedure section 437c, subdivision (c) provides that summary judgment shall be granted when there is no triable issue of material fact and the moving party is entitled to judgment as a matter of law. A defendant “moving for summary judgment bears an initial burden of production to make a prima facie showing of the nonexistence of any triable issue of material fact.” (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850.)

The defendant may satisfy this burden by showing either that one or more elements of a cause of action cannot be established or that there is a complete defense. (Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at p. 850.) “[A]ll that the defendant need do is to show that the plaintiff cannot establish at least one element of the cause of action[;] the defendant need not himself conclusively negate any such element.” (Id. at p. 853.) A defendant may make such a showing “by reliance on the pleadings, competent declarations, binding judicial admissions contained in the allegations of the plaintiff’s complaint, responses or failures to respond to discovery, and the testimony of witnesses at noticed depositions.” (Eisenberg v. Alameda Newspapers, Inc. (1999) 74 Cal.App.4th 1359, 1375.)

If the defendant’s prima facie case is met, the burden shifts to the plaintiff to show the existence of a triable issue of material fact as to that cause of action or defense. (Aguilar v. Atlantic Richfield Co., supra, 25 Cal.4th at p. 849; Silva v. Lucky Stores, Inc. (1998) 65 Cal.App.4th 256, 261.) However, “ ‘[w]hen opposition to a motion for summary judgment is based on inferences, those inferences must be reasonably deducible from the evidence, and not such as are derived from speculation, conjecture, imagination, or guesswork.’ ” (Waschek v. Department of Motor Vehicles (1997) 59 Cal.App.4th 640, 647.)

We review a summary judgment ruling de novo to determine whether there is a triable issue as to any material fact and whether the moving party is entitled to judgment as a matter of law. (Certain Underwriters at Lloyd’s of London v. Superior Court (2001) 24 Cal.4th 945, 972.) We effectively assume the role of a trial court and apply the same rules and standards that govern a trial court’s determination of a motion for summary judgment. (Lenane v. Continental Maritime of San Diego, Inc. (1998) 61 Cal.App.4th 1073, 1079.)

Guided by these standards, we hold the trial court properly granted summary judgment because HBO met its burden of showing essential elements of each cause of action cannot be established and appellant failed to raise a triable issue of material fact as to such causes of action.

DISCUSSION

1. There Is No Triable Issue of Fact as to Appellant’s Claims for Fraud by False Promise and Breach of Contract

In his first cause of action, appellant claims fraud by false promise, alleging that HBO made promises and representations that he would “receive the benefits, compensation and recognition of a working co-producer of the series.” (Italics added.) In his second cause of action, for breach of contract, appellant further alleges HBO entered into an oral agreement that appellant would receive “single-card co-producing credit and a working relationship as a co-producer on pre-production, production, and post-production” of the Carnivale series. (Italics added.) Appellant contends the trial court erred in granting summary judgment because the evidence established a triable issue of fact whether HBO breached the oral agreement for a “two year co-producer working relationship” and whether the contract was a result of HBO’s fraudulent concealment that it had no intention of honoring the agreement.

We find summary judgment to be appropriate since HBO established through appellant’s own deposition admissions that he in fact worked as a coproducer on the pilot and there was no guarantee for appellant to be a working producer on further series episodes.

In support of summary judgment, White declared that her notes of her conversation with appellant indicated they specifically discussed his work on the show would be on a “pay-or-play” basis. She attested that appellant had been very enthusiastic at the prospect of being connected to the show; at no point did appellant ask about the duration of his work on the show or indicate he wanted a guarantee that HBO would use his services for any length of time. Attorney Smith also executed a declaration stating that appellant never asked about the duration of his work on the show, nor did he express any desire for a guarantee HBO would use his services for any length of time. In fact, Smith stated, had appellant done so, she would have declined to provide a guarantee and would have informed him the “pay-or-play” provision was a standard term and was nonnegotiable.

In opposition to summary judgment, appellant was unable to present any evidence that HBO promised him a working relationship on the show. Appellant failed to identify any statement by an employee of HBO that defined his role on the show or addressed the tenure of his employment. The only evidence appellant cited besides his own declarations established that HBO consistently denied any contractual term guaranteeing appellant any active role on the show.

Appellant’s own sworn deposition testimony regarding his communications with White and Smith itself established there was no guarantee of a continuing working relationship. During his deposition, appellant was unable to point to any statement by White or Smith that he would have a day-to-day creative role on the show. Appellant testified that the subject never came up with White and that Smith expressly told him the opposite, i.e., that HBO reserves the right to employ or not employ talent as it sees fit and this policy was “nonnegotiable.” Appellant’s deposition admissions are binding. (D’Amico v. Board of Medical Examiners (1974) 11 Cal.3d 1, 21-22.)

Moreover, appellant’s contradictory declarations in opposition to summary judgment clearly ought to be disregarded in light of appellant’s unequivocal deposition admissions. (D’Amico v. Board of Medical Examiners, supra, 11 Cal.3d at p. 22 [admissions against interest have a very high credibility value, particularly when “obtained . . . in the context of an established pretrial procedure whose purpose is to elicit facts”]; Benavidez v. San Jose Police Dept. (1999) 71 Cal.App.4th 853, 860-863 [a party cannot create an issue of fact by a declaration that contradicts her prior unequivocal deposition testimony]; Daddario v. Snow Valley, Inc. (1995) 36 Cal.App.4th 1325, 1341-1342 [plaintiff’s declaration contradicting earlier deposition testimony ineffective to raise a triable issue of material fact]; Visueta v. General Motors Corp. (1991) 234 Cal.App.3d 1609, 1613 [“Admissions or concessions made during the course of discovery govern and control over contrary declarations lodged at a hearing on a motion for summary judgment”]; Thompson v. Williams (1989) 211 Cal.App.3d 566, 573-574 [“After-the-fact attempts to reverse prior admissions are impermissible because a party cannot rely on contradictions in his own testimony to create a triable issue of fact”].)

On appeal, appellant cites the “two-year lock” as evidence of HBO’s promise of a two-year creative participation in the show. He asserts HBO’s admissions concerning the “two-year lock” and partial tender of checks for the two-year period constitutes “independent evidence” of a two-year contract for “co-producer participation, credit and payment.”

Appellant cites a portion of White’s deposition testimony, in which she stated that “[t]here was a contract” with appellant. She testified that: as negotiated, the agreement was for appellant “to come on board at the development phase as a co-producer”; if the show went forward to a pilot, “he would be a co-producer”; and, if the show was produced as a series, “he would be a co-producer for the first and second year.” When viewed in context, it is clear White was speaking only in terms of a coproducer credit. Appellant’s counsel had previously asked White, “did you discuss with [appellant] at that time that he would receive credit on the show?” (Italics added.) She answered, “We spoke about what his title would be and also too what screen credit would be.” (Italics added.) Counsel then established with White that the credit would show in the titles as “a co-producer.” He asked, “And was [appellant] to have that credit for the series?” (Italics added.) She replied, “As negotiated, there was the pilot and the first two series years.” Appellant also cites a portion of Attorney Smith’s deposition in which she testified HBO had an “agreement” with appellant but she did not remember the specific terms.

Appellant cites no other evidence or any admission by either White or Smith to establish the “two-year lock” actually referred to a “guaranteed lock of two years on the series along with . . . [a] working relationship.” (Italics added.) However, appellant expressly admitted in his deposition that the term “lock” referred only to his right to receive the agreed-upon payments if the show was produced for two seasons. He testified, “That’s what a two-year deal is, when you say your first series year is [$]7500 and your second year is [$]8,000, it’s called a two-year lock.” (Italics added.) HBO’s compliance with the two-year lock and tender of payments under that agreement therefore do not lend support for any claim to a guaranteed working relationship.

White’s declaration in support of the summary judgment was consistent with appellant’s testimony that the “lock” referred to the episodic payments. White stated she offered appellant “[a] guaranteed payment of $7,500 for each episode of the Show produced by HBO in the first season (increasing to $8,000 per episode for each episode produced in the second season).” (Italics added.) White, however, went on to declare that she took contemporaneous notes of the conversation with appellant which expressly indicated his employment was “p-o-p.” She stated the fact she made such a notation indicated she had discussed with appellant that his work on the show would be on a “pay-or-play” basis. As noted, appellant testified at deposition that his “day-to-day job function” was “not defined” in his conversation with White. Regardless of which version of this conversation is correct, neither provides support for any promise to actively employ appellant for a fixed period of time.

Moreover, the undisputed evidence indicated appellant was at best an at-will employee. The certificate of engagement that appellant signed provided only that appellant was an “employee-for-hire” and contained no guarantee of continued employment. Absent any agreed term of employment, an employee for hire may be terminated at the will of either party on notice to the other. (Lab. Code, § 2922; Eisenberg v. Alameda Newspapers, Inc., supra, 74 Cal.App.4th 1359, 1386 [“in the absence of any evidence of the duration or term of employment under a written or oral agreement, there is a statutory presumption that employment is terminable at will”].) It is the employee’s burden to prove employment was not at will. (Haycock v. Hughes Aircraft Co. (1994) 22 Cal.App.4th 1473, 1492.)

Appellant suggests HBO had the obligation to retain him under an implied covenant of good faith and fair dealing. We disagree. The duty of good faith and fair dealing cannot change the specific obligations of the parties under a contract. (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 349-350.) The implied covenant “cannot impose substantive duties or limits on the contracting parties beyond those incorporated in the specific terms of their agreement.” (Id. at pp. 349-350; see also Carma Developers (Cal.), Inc. v. Marathon Development California, Inc. (1992) 2 Cal.4th 342, 374-376.)

Appellant’s reliance upon Locke v. Warner Bros., Inc. (1997) 57 Cal.App.4th 354, 363, is misplaced. Locke held that, when one contracting party has discretionary power affecting the rights of the other, a duty is imposed to exercise that discretion in good faith. (Id. at p. 363.) In that case, Locke had an agreement with defendant, Warner Bros., Inc., for a two-part deal, consisting of (1) a “non-exclusive first look deal,” under which Locke would submit to Warner any picture she was interested in developing before submitting it to any other studio; and (2) a “pay-or-play” directing deal, under which Warner could either use Locke’s services or pay the director’s fee.

In opposing summary judgment, Locke proffered the sworn evidence of two witnesses who stated that Warner’s executives had expressed an absolute unwillingness to work with plaintiff under any circumstances. (Locke v. Warner Bros., Inc., supra, 57 Cal.App.4th at pp. 362, fn. 2, 364-365.) The appellate court held Locke had presented sufficient evidence from which a trier of fact reasonably could infer the agreement was a sham and Warner had never intended to give her proposals a good faith evaluation. (Id. at p. 365.) Locke was entitled to have a trier of fact determine whether Warner’s categorical refusal to work with Locke was a breach of the implied covenant of good faith and fair dealing. (Id. at p. 367; see also Pasadena Live v. City of Pasadena (2004) 114 Cal.App.4th 1089, 1093.) As we have similarly stated, “ ‘ “the covenant is implied as a supplement to the express contractual covenants, to prevent a contracting party from engaging in conduct which (while not technically transgressing the express covenants) frustrates the other party’s rights to the benefits of the contract.” ’ ” (Benach v. County of Los Angeles (2007) 149 Cal.App.4th 836, 855, fn. 12.)

In the present case, appellant proffered no evidence from which it might be inferred HBO determined to frustrate appellant’s right to the benefits of their agreement. Indeed, appellant himself testified he worked on the development of the show and on the pilot before HBO decided to refrain from continuing with his services. Since no fixed term was promised, HBO’s termination of appellant’s employment did not breach any duty of good faith. “Precisely because employment at will allows the employer freedom to terminate the relationship as it chooses, the employer does not frustrate the employee’s contractual rights merely by doing so. In such a case, ‘the employee cannot complain about a deprivation of the benefits of continued employment, for the agreement never provided for a continuation of its benefits in the first instance.’ ” (Guz v. Bechtel National, Inc., supra, 24 Cal.4th at p. 350, quoting Hejmadi v. AMFAC, Inc. (1988) 202 Cal.App.3d 525, 547.)

Nor is it of import in this case that HBO allegedly “flippantly” undercut appellant’s actual participation. “Where the employment contract itself allows the employer to terminate at will, its motive and lack of care in doing so are, in most cases at least, irrelevant.” (Guz v. Bechtel National, Inc., supra, 24 Cal.4th at p. 351.) As our Supreme Court has noted, “[a]llegations that the breach was wrongful, in bad faith, arbitrary, and unfair are unavailing; there is no tort of ‘bad faith breach’ of an employment contract.” (Id. at p. 352.)

The trial court therefore did not err in granting HBO a summary judgment on the false promise and breach of contract claims.

2. There Is No Triable Issue of Fact as to Appellant’s Claims of Induced Breach of Contract or Negligent Interference with Contract

The trial court also properly dismissed appellant’s claims for intentional and negligent interference with contract.

For an interference with contract, a plaintiff has to show, in the first instance, that the underlying contract was breached. (Sole Energy Co. v. Petrominerals Corp. (2005) 128 Cal.App.4th 212, 238 [action for interference with contractual relations requires actual breach or disruption of the contractual relationship]; Dickenson v. Samples (1951) 104 Cal.App.2d 311, 316 [“since there was no breach of contract by [the third party], it follows that [defendant] cannot be held to account for a nonexistent wrong of inducing a breach of such contract”]; see Case v. Kadota Fig Assn. (1950) 35 Cal.2d 596, 605 [“Obviously, if no breach had occurred, [defendant] could not have committed the wrong charged against it”].)

Appellant admitted in his deposition that he was unaware of any breach of the option contract by either McCarthy or Knauf. Defense counsel pressed appellant during his deposition on this point, and appellant steadfastly denied asserting any breach by McCarthy or Knauf, either by providing them with notice of default or demanding an arbitration pursuant to the option contract.

Appellant’s deposition admissions are fatal to his two interference causes of action. In his declaration in opposition to the motion for summary judgment, appellant only offered speculations as to what White might have represented to Knauf or to McCarthy’s representative and what they in turn might have been led to believe. Such speculation or guesswork is wholly insufficient to raise a triable issue of fact. (Waschek v. Department of Motor Vehicles, supra, 59 Cal.App.4th at p. 647.) Even if considered, appellant’s speculations do not demonstrate that McCarthy or Knauf ever breached their option contract with appellant.

Since appellant failed to show a triable issue of fact exists as to an essential element for any interference with contract, we need not address HBO’s contention that California does not recognize a claim for negligent interference with contract. (See Fifield Manor v. Finston (1960) 54 Cal.2d 632, 636-637; LiMandri v. Judkins (1997) 52 Cal.App.4th 326, 349.)

DISPOSITION

The judgment is affirmed. HBO is to recover costs on appeal.

We concur: COOPER, P. J., EGERTON, J.

Judge of the Los Angeles Superior Court, assigned by the Chief Justice pursuant to article VI, section 6 of the California Constitution.

Paragraph 2 of the option contract further provided, “No party hereto shall have the right to proceed with the development, production, distribution and/or other exploitation of the Property and/or Picture until all other parties have given their full and complete approval to the terms of their respective agreements; it being agreed by [appellant], McCarthy and [Knauf] that no party hereto shall unreasonably withhold their approval.”

Under the practice of “pay or play,” an artist is entitled to receive an agreed-upon amount of compensation in exchange for the right (but not the obligation) of the financing party to use the artist’s services in a show. The financing party is required to pay the artist the agreed-upon compensation for the show regardless of whether it actually uses the artist’s services.

Appellant later proffered a “sur reply further declaration,” in further opposition to the summary judgment motion. In this third declaration he asserted that he had “accepted the lower monetary figure [than his coproducers] only because of Ms. White’s representation of receiving the valuable credit and working relationship.” (Italics added.) Appellant denied testifying at deposition that his day-to-day function was “ ‘not defined’ ” during his conversation with White. He claimed his day-to-day duties were supposed to have been addressed by HBO’s “creative executives.” He now declared, ‘The day-to-day function would not be something I would discuss with Ms. White as it was not her domain.”


Summaries of

Keyghobad v. Home Box Office Inc.

California Court of Appeals, Second District, Eighth Division
May 6, 2008
No. B194997 (Cal. Ct. App. May. 6, 2008)
Case details for

Keyghobad v. Home Box Office Inc.

Case Details

Full title:ROBERT KEYGHOBAD, Plaintiff and Appellant, v. HOME BOX OFFICE, INC.…

Court:California Court of Appeals, Second District, Eighth Division

Date published: May 6, 2008

Citations

No. B194997 (Cal. Ct. App. May. 6, 2008)