United States District Court, W.D. Oklahoma
L. RUSSELL UNITED STATES DISTRICT JUDGE.
the Court is Defendant's Motion to Dismiss, Doc. 6.
Plaintiff Big Hunt entered into a contract for the 2016
hunting season with Defendant Smith & Wesson
(“S&W”), a “well-known firearms
manufacturer, ” to produce television shows,
commercials, and other content featuring S&W products.
Doc. 1-1, at 2. That contract expired on January 31, 2017,
and Defendant notified Plaintiff on February 13, 2017 that it
did not intend to renew. However, by then Plaintiff had
already “completed the bulk of its filming for the
 season.” Doc. 1-1, at 3. Plaintiff sued
Defendant to recover for these services under two alternate
theories: 1) breach of contract-alleging that the parties
incorporated into their contract an auto-renewal provision of
their Copyright License and Release, and 2) quantum
meruit-alleging that Plaintiff rendered valuable services
outside the contract's scope with a reasonable
expectation of compensation. The Court hereby dismisses the
breach of contract claim based on the expired contract and
finds that Plaintiff alleges a plausible quantum meruit claim
to recover for its 2017 production services.
are three documents to consider in this case-(1) the
“Television Advertising and Sponsorship Agreement,
” which provides that S&W pays Big Hunt $67, 500
for content promoting S&W on various media during the
term of January 1, 2016 through January 31, 2017, Doc. 6-1,
at 1-4; (2) the Agreement's expressly incorporated
“Terms and Conditions, ” id. at 5-6; and (3)
the “Copyright License and Release, ” also
referred to as “EXHIBIT A to Television Advertising and
Sponsorship Agreement, ” which grants S&W
intellectual property rights in the content produced under
the Television Advertising and Sponsorship Agreement; the
License also provides that “the Term will automatically
renew” for another year “unless a party provides
the other parties with written notice of non-renewal at least
thirty (30) days prior to expiration” of the term.
Id. at 7-9.
includes the Television Advertising and Sponsorship Agreement
and Copyright License and Release in its complaint, but omits
the Terms and Conditions. Doc. 1-1, at 7-13. Nonetheless, the
Court considers all three documents to determine whether the
Agreement automatically renewed for a year and whether it was
reasonable for Plaintiff to expect compensation for the
production of 2017 content without a new
turning to the merits of Plaintiff's two claims, the
Court must first address jurisdiction and the governing law.
Defendant removed this suit from the District Court of
Cleveland County, Oklahoma, on the basis of diversity
jurisdiction. Doc. 1. The removal application and petition
offer a conclusory statement that the amount in controversy
exceeds $75, 000, even though the underlying contract at
issue is for $67, 500 and Plaintiff only alleges that it
provided a fraction of these services for the 2017 season.
Doc. 1, at 3; Doc. 1-1, at 3-5. However, Oklahoma allows for
the recovery of attorney's fees in civil actions
“for labor or services rendered, ” 12 O.S. §
936, and “statutorily allowed attorney fees may be
considered in determining the amount in controversy.”
Humphreys v. Fuselier, 124 F.3d 216 (10th Cir. 1997)
(unpublished) (citing Missouri State Life Ins. Co. v.
Jones, 290 U.S. 199, 202 n.3 (1933)); see also
Francis v. Allstate Ins. Co., 709 F.3d 362, 368 (4th
Cir. 2013). Thus, the Court finds that Defendant has made
“a plausible allegation that the amount in controversy
exceeds the jurisdictional threshold.” Dart
Cherokee Basin Operating Co., LLC v. Owens, 135 S.Ct.
547, 554 (2014); see also McPhail v. Deere &
Co., 529 F.3d 947, 953 (10th Cir. 2008).
choice-of-law principles treat Plaintiff's two claims
differently. Massachusetts law governs Plaintiff's breach
of contract claim because the Agreement and License both
contain Massachusetts “Governing Law” provisions.
Doc. 6-1, at 6, 8. Harvell v. Goodyear Tire & Rubber
Co., 164 P.3d 1028, 1033-34 (Okla. 2006).
quantum meruit action, by contrast, is governed by Oklahoma
law because it does not arise expressly from these contracts,
but from an implied contract based on the
parties' conduct. See Klebe v. United States,
263 U.S. 188, 192 (1923). “Oklahoma conflict-of-law
principles apply . . . [f]or [Plaintiff's] implied
contract claim” and “dictate that lex loci
contractus controls-i.e., ‘the nature, validity,
and interpretation of a contract are governed by the law
where the contract was made.'” Yavuz v. 61 MM,
Ltd., 576 F.3d 1166, 1178 (10th Cir. 2009) (quoting
Harvell, 164 P.3d at 1034). For an implied contract
like this, Oklahoma law considers the contract to have been
made “where the services were rendered.”
Harvell, 164 P.3d at 1036. Plaintiff rendered the
services at issue, production for the 2017 season, in
Oklahoma. Doc. 1-1, at 1. At the Court's July 26, 2018
hearing, neither party suggested that Massachusetts or
Oklahoma law would dictate a different result in this case.
Breach of Contract
fails to allege a plausible breach of contract claim
because-to state the obvious-[t]o prevail on a claim for
breach of contract, a plaintiff must demonstrate that there
was an agreement between the parties.” Bulwer v.
Mount Auburn Hosp., 473 Mass., 46 N.E. 3d 24, 39 (Mass.
2016). The parties agreed to a Television Advertising and
Sponsorship Agreement for the 2016 “Broadcast
Season/Term, ” with terms running from January 1, 2016
through January 31, 2017. Doc. 6-1, at 1. Plaintiff does not
allege that Defendant failed to meet its obligations during
this term; it instead claims that Defendant failed to make
payments for the 2017 season, in which the parties lacked a
formal contract. Doc. 1-1, at 3- 4. Thus, by suing on an
expired contract for services outside the contract's
scope, Plaintiff cannot meet an essential element of breach
attempts to resurrect this claim by arguing that the
Television Advertising and Sponsorship Agreement incorporated
by reference the auto-renewal provision in their Copyright
License and Release, and that the License “has no
ascertainable purpose” if unincorporated. Doc. 7, at
11-12; see Doc. 1-1, at 4; Doc. 6-1, at 7
(“[T]he Term will automatically renew for additional
successive twelve (12) month periods, unless a party provides
the other parties with written notice of non-renewal at least
thirty (30) days prior to expiration of the then-current
twelve (12) month Term.”). To incorporate by reference,
“the document to be incorporated [must] be referred to
and described in the contract so that the referenced document
may be identified beyond doubt.” Lowney v. Genrad,
Inc., 925 F.Supp. 40, 47 (D. Mass. 1995)). The language
used “to incorporate extrinsic material by reference .
. . must clearly communicate that the purpose of the
reference is to incorporate the referenced material into the
contract (rather than merely to acknowledge that the
referenced material is relevant to the contract, e.g., as
background law or negotiating history).” NSTAR
Elec. Co. v. Dep't of Pub. Utilities, 968 N.E.2d
895, 905-06 (Mass. 2012) (quoting Northrop Grumman Info.
Tech., Inc. v. United States, 535 F.3d 1339, 1345 (Fed.
Cir. 2008)). When “language [is] ambiguous, ” the
Court “consider[s] it in light of the ‘contract
as a whole, in a reasonable and practical way.'”
Id. (quoting MCI WorldCom Communications, Inc.
v. Dep't of Telecomm & Energy, 810 N.W.2d 802
Television Advertising and Sponsorship Agreement only
incorporates the Terms and Conditions, not the
Copyright License and Release. There are at least five
textual reasons: (1) the Agreement expressly
“incorporate[s] herein by reference” the
“Terms and Conditions, ” whereas the Agreement
merely refers to the Copyright License and Release by stating
“See Exhibit ‘A'” and “Producer
shall . . . obtain and provide to S&W executed copy(ies)
of the Copyright License and Release, in the form attached
hereto as Exhibit A . . . .” Doc. 6-1, at 2-3; (2) the
bottom of each page of the Terms and Conditions states
“Smith & Wesson Terms and Conditions Television
Advertising and Sponsorship Agreement, ” whereas the
License pages only read “Copyright License and Release,
” id. at 5-9; (3) the Terms and Conditions and
Copyright License and Release each repeat entire sections,
meaning that the parties did not intend to automatically
apply the Terms and Conditions' sections to the License,
id.; (4) the License's auto-renewal section
refers to “a party provid[ing] the other
parties with written notice, ” meaning there
are at least three parties to that contract, whereas the
Television Advertising and Sponsorship Agreement clearly has
only two parties, id. at 4, 7, 9 (emphasis added);
(5) the phrase “This Agreement” in the
License's auto-renewal section refers to “This
Copyright License and Release (the
‘Agreement').” Id. at 7.
purpose-driven argument fairs no better. Doc. 7, at 11-12.
The Copyright License and Release maintained an
“ascertainable purpose” when it automatically
renewed in spite of the Agreement's expiration-it
provided Defendant continued intellectual property rights in
the content that Plaintiff already produced, meaning that
S&W could reproduce 2016 content even if Big Hunt stopped
making new shows and commercials. See Doc. 6-1, at
7-9. It is actually the Television Advertising and
Sponsorship Agreement that would have no purpose if it
out-lasted the Copyright License and Release because then