Contracts Keyed to Murray
CBS, Inc. v. Merrick
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CBS, Inc. (Plaintiff) agreed to purchase the television rights to the novelBlood and Moneyfrom David Merrick (Defendant). Under the contract, if photography on the television series had not started by August 1, 1979, the rights to the novel would revert to Defendant. Plaintiff paid $916,666 to Defendant and his agents. Pursuant to the agreement, Defendant hired a director and screenwriter for the project, and Plaintiff paid them $750,000. Defendant knew that the director and screenwriter could not begin work on the project right away, but failed to tell them of the August 1 deadline or hire additional screenwriters. Photography was unable to start by the August 1 deadline, because the screenplay was not finished. Plaintiff brought an action for rescission and restitution. The trial court found that Defendant had refused to perform and breached the contract with Plaintiff. The court awarded restitution damages of the $916,666 Plaintiff paid to Defendant and his agent, but refused to award Plaintiff the $750,000 it paid the director and screenwriter as reliance damages.
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