Opinion
NOT TO BE PUBLISHED
APPEAL from an order of the Superior Court of Los Angeles County No. EC049512, Michael S. Mink, Judge.
Lavely & Singer, William J. Briggs II, Evan N. Spiegel; Greines, Martin, Stein & Richland, Kent L. Richland, Jens B. Koepke and Kent J. Bullard for Plaintiffs and Appellants.
Law Offices of Gary Freedman, Gary Freedman; Browne Woods George and Edward A. Woods for Defendants and Respondents.
CROSKEY, Acting P. J.
Young Money Entertainment, LLC (Young Money), and Dwane Michael Carter, Jr., appeal the denial of a preliminary injunction in an action arising from the alleged breach of written agreement. The agreement provided that Digerati Holdings, LLC (Digerati), would produce a 90-minute biographical film about Carter, a rap musician. The agreement granted Carter “a sole right of final approval” with respect to any scene that might depict him engaged in criminal behavior or adversely affect his interests in pending criminal cases. Young Money and Carter allege that Digerati breached this provision by exhibiting a film containing such a scene despite their objections. The agreement also stated that Young Money’s and Carter’s sole remedy for any breach by Digerati was “an action at law for damages already suffered,” and that they could not obtain injunctive relief. The trial court concluded that this provision was not unconscionable and that the provision precluded injunctive relief. We agree and affirm the order.
FACTUAL AND PROCEDURAL BACKGROUND
1. Factual Background
Carter is a well-known entertainer who performs under the stage name Lil’ Wayne. Young Money is a corporation founded by Carter. Digerati is an entertainment production company. QD3 and Quincy Delight Jones III are members of Digerati.
Digerati approached Carter and his personal manager, Cortez Bryant, in November 2007 to discuss producing a documentary film about him. Digerati provided a draft agreement. The parties, through their attorneys, then negotiated some of its provisions. Young Money and Carter asked to modify a provision concerning “final approval” rights so as to ensure that Carter would have the right to approve or disapprove the film content, particularly with respect to the depiction of conduct that might adversely affect his interests in then-pending criminal cases involving an illegal gun possession charge in New York and a drug possession charge in Arizona. Digerati agreed to modify the provision. Young Money and Carter also sought to modify a provision that allowed Digerati to obtain injunctive relief upon a breach by Young Money or Carter but limited the relief available to Young Money and Carter for a breach by Digerati to only money damages. Digerati refused to modify that provision.
The final written agreement between Young Money and Digerati, dated December 19, 2007, stated that Carter would appear in formal interviews and otherwise participate in the making of a 90-minute documentary film about him. Paragraph 2(b) of the agreement stated:
“Subject to Company’s [Digerati’s] distribution agreement, as between Company, on the one hand, and you [Young Money] and DC [Carter], on the other hand, DC shall have the right to inspect and/or approve the use of the DC Performance and/or the DC Materials, or any other results and proceeds of DC’s services hereunder. Said approval shall not be unreasonably withheld and DC shall provide Company with written approval of the Scenes or specific written objections to the Scenes no later than 7 days (for DC’s manager) and 3 days (for DC’s attorney) following: (i) DC’s or such applicable representative’s review of the Scenes as they appear in the final cut of the Picture if DC or such applicable representative reviews the Scenes at a location designated by Company, or (ii) DC’s or such applicable representative’s receipt of a copy of the Scenes if Company agrees to provide DC with a copy of the Scenes for his review. Notwithstanding anything to the contrary set forth herein, DC shall have a sole right of final approval in connection with any scene(s) in the Picture that might depict or describe any of DC’s actions or activities as criminal in nature or that might have any adverse affect on DC’s pending criminal trials.”
Paragraph 8(b) of the agreement stated:
“You acknowledge that the services to be rendered by DC and the rights granted and/or licensed to Company hereunder are of a special, unique, unusual, extraordinary and intellectual character which gives them a peculiar value, the loss of which cannot be reasonably compensated in damages in an action at law, and that the default by you or DC of your or DC’s obligations hereunder will cause Company irreparable injury and damage. Accordingly, you agree that in the event of a breach or threatened breach hereof by you or DC, Company shall be entitled to injunctive or equitable relief and such other remedies as may be available at law, including, without limitation, damages. In the event of any breach by Company hereunder, the sole remedy of you and DC shall be limited to an action at law for damages actually suffered, and in no event shall you or DC be entitled to seek injunctive or other equitable relief or have any right to terminate, rescind or cancel this Agreement and/or to enjoin or restrain or otherwise impair the production, distribution, exhibition or other exploitation of the Picture or any parts or elements thereof. In the event of any action, suit or proceeding arising from or based upon this Agreement brought by either party hereto against the other, the prevailing party shall be entitled to recover from the other its reasonable attorneys’ fees in connection therewith in addition to the costs of such action, suit or proceeding.”
The agreement also included an integration clause, stating:
“This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes and cancels any and all previous written or oral negotiations, commitments, understandings, agreements and any other writings or communications in respect of such subject matter.”
Carter allowed Digerati to record his personal life and activities throughout 2008. After viewing a version of the film in early December 2008, Bryant asked Digerati to remove a scene purportedly showing Carter misusing medication. Carter’s attorney made the same request in writing on December 19, 2008. Digerati screened the film for Carter in late December 2008. Carter stated that he liked the film, but he told Digerati’s representatives that the film portrayed him in a negative light and asked his attorney and Bryant to demand that the objectionable content be removed. Digerati stated in writing on December 29, 2008, that it had made the requested changes.
Digerati sent an e-mail message to Bryant and Carter’s attorney on January 7, 2009, with a link to film clip and a message stating, that it had “moved this scene up in the film so it doesn’t fall towards the end of the movie and is now balanced with both Wayne and Cortez talking about the issue of syrup/heroin.... [¶] This is the version I screened for Wayne on his bus in LA.” The film clip included the same scene that Young Money previously had objected to. Carter’s attorney responded in an e-mail demanding that the film not be exhibited until Carter provided his written consent and stating that he would discuss “a workable solution” with Digerati’s attorney. Digerati replied that it had “worked long and hard” to make the film, that Young Money had previously breached the contract, and that Digerati hoped to find a workable solution but was facing time deadlines.
Digerati exhibited the film, including the disputed scene, at the Sundance Film Festival in January 2009. Carter’s attorney protested and demanded that Digerati cease any further exhibition of the film. Digerati refused and stated that it intended to pursue a distribution deal and exhibit the film at the Cannes Film Festival in May 2009.
2. Trial Court Proceedings
Young Money and Carter filed a complaint in March 2009 against Digerati, QD3, and Jones. They allege that the defendants breached the contract by failing to honor Carter’s final approval rights. They allege counts for (1) breach of contract; (2) breach of the implied covenant of good faith and fair dealing; (3) unfair competition; (4) intentional misrepresentation; (5) constructive fraud; (6) invasion of privacy; and (7) injunctive relief.
Young Money and Carter immediately applied ex parte for a temporary restraining order to prevent the defendants from exhibiting, distributing, licensing, selling, or otherwise exploiting the film, and requested an order to show cause regarding a preliminary injunction. They argued that public exhibition of the disputed film content could impair Carter’s defense in his pending criminal cases and irreparably harm him. They also argued that the anti-injunction provision was unconscionable and unenforceable. They argued further that, apart from unconscionability, the anti-injunction provision was inapplicable to a breach of Carter’s final approval rights. The trial court denied the application in March 2009.
QD3 and Jones moved to disqualify the judge under Code of Civil Procedure section 170.6, and the case was reassigned to another judge. The court scheduled a hearing to determine whether the anti-injunction provision was valid and enforceable and a second hearing to determine whether a preliminary injunction should issue. The court stated that the second hearing would proceed only if the court determined that the anti-injunction provision was unenforceable. The first hearing occurred on April 16, 2009.
The court denied a preliminary injunction in an order filed on April 16, 2009. The order stated that there was no surprise or oppression in connection with the anti injunction provision and that the provision therefore was not procedurally unconscionable. The order stated further that the provision was not substantively unconscionable because Digerati had a legitimate need to limit the plaintiffs’ ability to interfere with the film’s distribution by seeking injunctive relief and because the provision did not preclude an award of monetary damages. Young Money and Carter timely appealed the order. They also petitioned this court for a writ of supersedeas and a temporary stay to prevent the defendants from exhibiting the film. We denied the petition.
An order denying a preliminary injunction is appealable. (Code Civ. Proc., § 904.1, subd. (a)(6); Right Site Coalition v. Los Angeles Unified School Dist. (2008) 160 Cal.App.4th 336, 338, fn. 1.)
CONTENTIONS
Young Money and Carter contend (1) the anti-injunction provision is procedurally and substantively unconscionable; (2) apart from unconscionability, the anti-injunction provision precludes an injunction only at the time of film distribution or later, after Carter has exercised his final approval rights as to the film’s contents; and (3) Carter’s final approval rights supersede the anti injunction provision.
DISCUSSION
1. Standard of Review
An order granting or denying a preliminary injunction ordinarily involves a balancing of equities and is reviewed for abuse of discretion. “In deciding whether to issue a preliminary injunction, a trial court weighs two interrelated factors: the likelihood the moving party ultimately will prevail on the merits, and the relative interim harm to the parties from the issuance or nonissuance of the injunction. [Citation.] ‘Generally, the ruling on an application for a preliminary injunction rests in the sound discretion of the trial court. The exercise of that discretion will not be disturbed on appeal absent a showing that it has been abused. [Citations.]’ [Citation.] ‘A trial court may not grant a preliminary injunction, regardless of the balance of interim harm, unless there is some possibility that the plaintiff would ultimately prevail on the merits of the claim. [Citation.]’ [Citation.]” (Hunt v. Superior Court (1999) 21 Cal.4th 984, 999.)
To the extent that the propriety of injunctive relief depends on a legal question, however, our review is de novo. (Strategix, Ltd. v. Infocrossing West, Inc. (2006) 142 Cal.App.4th 1068, 1072; O’Connell v. Superior Court (2006) 141 Cal.App.4th 1452, 1463.) The propriety of injunctive relief here depends on the enforceability of the contract provision barring injunctive relief and on our interpretation of the provision. We independently determine whether a contract provision is unconscionable. (Baker v. Osborne Development Corp. (2008) 159 Cal.App.4th 884, 892.) In so doing, we defer to any factual findings made by the trial court in connection with its ruling if substantial evidence supports those findings. (Ibid.) Contract interpretation also is a question of law subject to our de novo review, unless the interpretation turns on the credibility of extrinsic evidence. (Parsons v. Bristol Development Co. (1965) 62 Cal.2d 861, 865.)
2. Procedural and Substantive Unconscionability
Unconscionability has both a procedural and a substantive element. (Armendariz v. Foundation Health Psychcare Services, Inc. (2000) 24 Cal.4th 83, 114 (Armendariz)) “ ‘Procedural unconscionability’ concerns the manner in which the contract was negotiated and the circumstances of the parties at that time.” (Kinney v. United HealthCare Services, Inc. (1999) 70 Cal.App.4th 1322, 1329.) A contract or provision is procedurally unconscionable if it resulted from oppression or unfair surprise. (Sanchez v. Western Pizza Enterprises, Inc. (2009) 172 Cal.App.4th 154, 173.) Oppression arises from unequal bargaining power and refers to the situation where the weaker contracting party has no meaningful choice other than to accept the contract terms. (Ibid.) Unfair surprise arises from misleading bargaining conduct or other circumstances indicating that a party’s consent was not an informed choice. (Ibid.)
Substantive unconscionability concerns the reasonableness of the substantive contract terms. (A & M Produce Co. v. FMC Corp. (1982) 135 Cal.App.3d 473, 487.) Terms that are “unfairly one-sided” or “ ‘ “ ‘overly harsh’ ” ’ ” are substantively unconscionable. (Little v. Auto Stiegler, Inc. (2003) 29 Cal.4th 1064, 1071.) Substantive unconscionability “ ‘ “turns not only on a ‘one-sided’ result, but also on an absence of ‘justification’ for it.” ’ [Citation.]” (Armendariz, supra, 24 Cal.4th at pp. 117-118.)
Procedural and substantive unconscionability must both be present in order to render a contract or provision unenforceable. (Armendariz, supra, 24 Cal.4th at p. 114.) The greater the procedural unconscionability, the less substantive unconscionability is required to render a provision unenforceable, and vice versa. (Ibid.)
3. The Anti-injunction Provision Is Not Procedurally Unconscionable
Young Money and Carter contend the anti-injunction provision is procedurally unconscionable because it resulted from oppression. They argue that the provision is oppressive because the defendants insisted that it was nonnegotiable. Young Money and Carter do not rely on unfair surprise as a basis for procedural unconscionability.
Oppression arises from unequal bargaining power, as we have stated. A contract or provision between parties of equal bargaining strength is not oppressive. (Crippen v. Central Valley RV Outlet (2004) 124 Cal.App.4th 1159, 1165-1166.) This is so regardless of whether a party insisted that a particular provision was nonnegotiable. A party of equal bargaining strength can address such a tactic in the contract negotiations and, if it fails to do so, cannot obtain judicial relief under the doctrine of unconscionability.
Young Money and Carter presented evidence that the defendants refused to modify the anti-injunctive provision and insisted that the provision was nonnegotiable. They presented no evidence, however, that the defendants had superior bargaining power. The defendants argued in opposition to the request for a preliminary injunction that Young Money and Carter had superior bargaining power because Carter was a very successful entertainer whose cooperation was essential to the production of a documentary about him. The trial court noted that Young Money and Carter could have negotiated a film deal with another producer, but did not expressly decide whether either party had superior bargaining power. As the party moving for a preliminary injunction, Young Money and Carter had the burden to present evidence sufficient to support the issuance of a preliminary injunction. (Evid. Code, §§ 500, 550.) Absent evidence that the defendants had superior bargaining power, we conclude that Young Money and Carter failed to establish procedural unconscionability based on oppression and therefore are not entitled to a preliminary injunction based on the purported unconscionability of the anti-injunction provision.
4. The Anti-injunction Provision Precludes a Preliminary Injunction
Young Money and Carter contend even if the anti-injunction provision is not unconscionable, it does not preclude a preliminary injunction in these circumstances. This presents a question of contract interpretation.
We interpret a contract so as to give effect to the mutual intention of the parties at the time the contract was formed. (Civ. Code, § 1636.) We ascertain that intention solely from the written contract, if possible, but also consider the circumstances under which the contract was made and the matter to which it relates. (Id., §§ 1639, 1647.) We consider the contract as a whole and interpret the language in context, rather than interpret a provision in isolation. (Id., § 1641.) We interpret words in a contract in accordance with their ordinary and popular sense, unless the words are used in a technical sense or a special meaning is given to them by usage. (Id., § 1644.) If contractual language is clear and explicit and does not involve an absurdity, the plain meaning governs. (Id., § 1638.)
Contractual language is ambiguous if it is susceptible of more than one reasonable interpretation in the context of the contract as a whole. (Palmer v. Truck Ins. Exchange (1999) 21 Cal.4th 1109, 1115.) In determining whether an ambiguity exists, a court should consider not only the face of the contract but also any extrinsic evidence that supports a reasonable interpretation. (Pacific Gas & E. Co. v. G. W. Thomas Drayage etc. Co. (1968) 69 Cal.2d 33, 37, 39 40.) Whether contractual language is ambiguous is a question of law that we review de novo. (Producers Dairy Delivery Co. v. Sentry Ins. Co. (1986) 41 Cal.3d 903, 912.) The interpretation of a contract, including the resolution of any ambiguity, is solely a judicial function unless the interpretation turns on the credibility of extrinsic evidence. (Parsons v. Bristol Development Co., supra, 62 Cal.2d at p. 865.)
The agreement sets forth the rights and obligations of Young Money, Carter, and Digerati with respect to the making of a biographical film. Those rights and obligations include Carter’s right to final approval of the film’s contents. Paragraph 2(b) of the agreement states that Carter has the right to approve or object to the film’s contents, that his approval cannot be unreasonably withheld, and, “Notwithstanding anything to the contrary set forth herein, DC shall have a sole right of final approval in connection with any scene(s) in the Picture that might depict or describe any of DC’s actions or activities as criminal in nature or that might have any adverse affect on DC’s pending criminal trials.”
The agreement also describes the remedies available for breach of the parties’ respective contractual obligations and limits the remedies available to Young Money and Carter for a breach by Digerati to an action for damages. The anti-injunction provision states that a breach by Young Money or Carter of their contractual obligations would cause irreparable injury to Digerati for which damages would be an inadequate remedy. It states that in the event of such a breach, Digerati is entitled to injunctive or equitable relief and any other legal remedy, including damages. It states further: “In the event of any breach by Company hereunder, the sole remedy of you and DC shall be limited to an action at law for damages actually suffered, and in no event shall you or DC be entitled to seek injunctive or other equitable relief or have any right to terminate, rescind or cancel this Agreement and/or to enjoin or restrain or otherwise impair the production, distribution, exhibition or other exploitation of the Picture or any parts or elements thereof.”
Young Money and Carter presented evidence that Digerati represented during the contract negotiations that potential distributors would insist on such an anti-injunction provision in order to ensure that the distribution and exhibition of the film could not be enjoined. They contend the anti-injunction provision therefore applies only at the time of distribution or later, after Carter has exercised his final approval rights as to the film’s contents.
Extrinsic evidence, including evidence of the contract negotiations, may be considered to explain the meaning of the contract terms, but cannot be considered to contradict the terms of an integrated contract. (Code Civ. Proc., § 1856; Casa Herrera, Inc. v. Beydoun (2004) 32 Cal.4th 336, 343-344.) The anti-injunction provision states that “[i]n the event of any breach” by Digerati, the sole remedy of Young Money and Carter is an action for damages, and that “in no event” can Young Money or Carter seek injunctive relief, terminate or rescind the agreement, or “enjoin or restrain or otherwise impair the production, distribution, exhibition or other exploitation” of the film. (Italics added.) The italicized language expressly limits the remedies available to Young Money and Carter for any breach by Digerati, at any time, and the limitation of remedies expressly applies in any event, without exception. Moreover, the provision expressly prohibits enjoining not only the distribution or exhibition of the film, but also its production. To interpret this provision to mean that the limitation of remedies applies only at the time of distribution or later, as Young Money and Carter argue, would be directly contrary to the plain language of the provision. We therefore conclude that the provision is not reasonably susceptible of such an interpretation.
Young Money and Carter also contend the language “[n]otwithstanding anything to the contrary set forth herein” in the provision establishing Carter’s sole right of final approval (paragraph 2(b) of the agreement) indicates that the limitation of remedies in the anti-injunction provision does not apply to the right of final approval. They argue that the right of final approval would be completely meaningless if equitable remedies were not available to protect that right and that the agreement should not be interpreted in a manner that would effectively negate the right. They argue further that the expressly negotiated and specific right of final approval should prevail over the more general anti-injunction provision that Digerati purportedly refused to negotiate. We are not persuaded.
We interpret the language “[n]otwithstanding anything to the contrary set forth herein” in this context to mean that Carter’s sole right of final approval supersedes any right or obligation under the agreement that is incompatible with the right of final approval. As a matter of contract interpretation, a limitation of remedies for breach of a contractual obligation is not incompatible with the existence of that obligation as long as some remedy for breach of the obligation remains. In other words, a limitation of remedies for breach of a contractual obligation does not render the obligation illusory so as to compel the conclusion that the parties could not have intended the limitation to apply to a particular obligation as long as there is some meaningful remedy for breach of the obligation. This is so even if the available remedy is not the most effective or the preferred remedy.
An injunction to restrain a breach of the right of final approval in these circumstances would be tantamount to the specific performance of that provision. (See Civ. Code, § 3423, subd. (e); Code Civ. Proc., § 526, subd. (b)(5).) One of the requirements for specific performance is inadequacy of the legal remedy. (Morrison v. Land (1915) 169 Cal. 580, 586-588.) Specific performance is not available if monetary damages would provide full and adequate compensation for the breach. (Ibid.) That is not the issue presently before us. The question presently before us is not whether the requirements for specific performance are satisfied, but whether the plaintiffs intentionally waived their equitable remedies. Accordingly, we express no opinion as to whether monetary damages would provide full and adequate compensation for the breach.
The agreement states that Young Money and Carter may not obtain any equitable relief in the event of a breach by Digerati and that their sole remedy is an action at law for damages. In our view, an award of money damages is a meaningful remedy, albeit perhaps not the preferred remedy for the plaintiffs in these circumstances. Accordingly, we conclude that the limitation of remedies is not incompatible with the existence of the right of final approval and that the right of final approval does not supersede the limitation of remedies.
The fact that Young Money and Carter sought to modify the anti-injunction provision suggests that they understood its importance.
Even if we assumed that the sole right of final approval provision was more specific and the anti-injunction provision more general, the rule that a specific provision prevails over a general provision applies only if the provisions are inconsistent (Code Civ. Proc., § 1859), which is not the case here. We also reject the argument that the right of final approval prevails over the anti-injunction provision because the former was expressly negotiated while the latter purportedly was never negotiated. The general rule that separately negotiated terms control over standardized terms or other terms not separately negotiated (see Rest.2d Contracts, § 203, subd. (d)) is a broader statement of the rule stated in Civil Code section 1651 (see also Code Civ. Proc., § 1862) that terms that are written or printed under the special direction of the parties control over terms that are copied from a form that originally was prepared without special reference to the particular parties and contract in question. Both the narrower and the broader iterations of the rule apply only if the provisions are inconsistent and cannot be reconciled (Prudential Realty etc. Co. v. Clarewood Co. (1960) 187 Cal.App.2d 320, 322; see Rest.2d Contracts, § 203, com. f, p. 95), which is not the case here.
Contrary to the argument by Young Money and Carter that the defendants refused to negotiate the anti-injunction provision, the defendants maintain that the parties discussed and negotiated the provision but the defendants refused to modify it. We need not resolve this particular dispute.
We conclude that the anti-injunction provision clearly and unambiguously precludes injunctive relief for breach of the sole right of final approval. Young Money and Carter have not shown that the anti-injunction provision is unconscionable or otherwise unenforceable, and therefore have shown no error in the denial of a preliminary injunction.
DISPOSITION
The order is affirmed. The defendants are entitled to recover their costs on appeal.
We Concur: KITCHING, J.. ALDRICH, J.