Blix Street Records, Inc. v. Cassidy

191 Cal. App. 4th 39, 119 Cal. Rptr. 3d 574, 2010 Cal. App. LEXIS 2137
CourtCalifornia Court of Appeal
DecidedDecember 21, 2010
DocketNo. B219624
StatusPublished
Cited by45 cases

This text of 191 Cal. App. 4th 39 (Blix Street Records, Inc. v. Cassidy) is published on Counsel Stack Legal Research, covering California Court of Appeal primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Blix Street Records, Inc. v. Cassidy, 191 Cal. App. 4th 39, 119 Cal. Rptr. 3d 574, 2010 Cal. App. LEXIS 2137 (Cal. Ct. App. 2010).

Opinion

Opinion

MOSK, J.

Appellants appeal from a judgment based on, inter aha, a determination that they were judicially estopped from denying that they were bound by a settlement agreement. We hold that even if the settlement agreement had not been binding, appellants were judicially estopped from denying the enforceability of that agreement because they represented to the trial court that the case had settled and the trial court discharged the jury in reliance on that representation.

FACTS

Eva Cassidy was a popular singer and songwriter who died in 1996. Her parents, respondents Hugh and Barbara Cassidy, inherited the rights to Eva’s work. In November of 1997, the Cassidys, pursuant to an agreement, [42]*42exclusively licensed William Straw, doing business as Blix Street Records, the predecessor of Blix Street Records, Inc.,1 to exploit the rights to the Eva Cassidy audio recordings. The license agreement was modified in 1999.

Disputes between Blix Street and the Cassidys arose over royalty payments and the Cassidys’ plan for a motion picture about their daughter’s life. The Cassidys had contracted with Allen Gelbard and Eva Cassidy Partners, LLC (ECP) (in which Gelbard was a partner), to make the motion picture. In March of 2004, Blix Street Records, Inc., sued the Cassidys, Gelbard, and ECP concerning the motion picture and an alleged breach of warranty. The Cassidys and their son Daniel subsequently cross-complained against Blix Street for royalties allegedly owing.2

The trial of the case commenced in March of 2006, presided over by Los Angeles County Superior Court Judge Lee Edmon. During jury selection, each lead counsel gave a “mini opening statement” to the jury panel. After the jury was selected, Judge Edmon suspended the trial for scheduling reasons and ordered the parties and the jury to report back on April 3, 2006. During the break, the parties engaged in a mediation with the mediator Anthony Piazza. Gelbard, who was in bankruptcy, and ECP did not participate, but their counsel, Christopher Dieterich, indicated they would enter into a settlement so long as they did not have to pay money and received full general releases. Those present at the mediation were Hugh and Barbara Cassidy and their counsel, Brian Sun, who also represented the absent Daniel Cassidy, and Straw (Blix Street) and his counsel. The parties to the mediation reached a settlement and executed a handwritten settlement agreement. The document was signed by Straw, for himself and for Blix Street Records, Inc., Hugh Cassidy, Barbara Cassidy, and Sun for Daniel Cassidy. The “approved as to form” spaces on the document were signed by Blix Street’s counsel and Sun for the Cassidys.

The settlement agreement provided, “Although subject to more formal documentation, including the preparation and filing of a dismissal of the entire action with prejudice, this is a final binding agreement subject to judicial enforcement pursuant to CCP 664.6.” The settlement agreement extended the licensing agreement and provided for, inter alia, minimum royalties over a period of years, a means to determine the amount of royalties, a business plan, cooperation concerning the motion picture, and releases. The agreement specifically stated that “The parties hereby release all claims of any type or nature from inception through today, including rights as to Gelbard, Engel [a former attorney for some of the parties] and Eva [43]*43Cassidy Partners, LLC (Gelbard and ECP to be releasors under the more formal agreement documents)” and that Blix Street’s first payment to the Cassidys “shall occur upon delivery to Bfix’s counsel of a full, executed dismissal of the entire action with prejudice and any order necessary from the U.S. Bankruptcy Court and U.S. Trustee.”

At the time of the execution of the settlement agreement, Straw believed that there were no additional terms that needed to be negotiated. On March 26, 2006, Blix Street’s counsel sent an e-mail to Judge Edmon that stated, “Judge Edmon: the parties reached a settlement at the mediation on Friday, March 24, 2006 and signed a document that can be enforced pursuant to CCP Section 664.6. We need to get a signature from the Eva Cassidy Partnership (Dieterich’s client) which should not be that difficult. There are issues relating to the release of claims against Gelbard given his bankruptcy that we need to navigate, but the case has settled.”

During the week of March 27, 2006, Straw, an attorney who had negotiated entertainment contracts, began to have concerns about the agreement and what he considered the negative effect it could have on his business. He believed it was one-sided in favor of the Cassidys and decided to take the position that material terms were missing from the settlement agreement and that some existing terms were ambiguous. He testified, “That’s—I started thinking about those things. And, if those things weren’t worked out, then I really hadn’t agreed to anything.” Thus, from his perspective, the litigation was not concluded. He said he wanted “to try to get out from under the settlement agreement.” He added that it was the “worst agreement I’d ever seen .... It didn’t contain, even the material terms necessary to settlement [sic] the issues that caused the litigation in the first place .... They were—it was just missing. No mention.” He testified at some length as to the various areas that were not covered by the settlement agreement. He said he did not, however, “withdraw from the deal” because he was “very hopeful” that he could resolve all issues in the long-form agreement negotiations.

The parties returned to court on April 3, 2006. Blix Street’s attorneys had not communicated to the Cassidys’ attorneys that there was any problem with the settlement agreement, even though Straw believed that an enforceable agreement had not been reached. Blix Street’s lead counsel, Bert Deixler, and the Cassidys’ lead counsel, Sun, as well as his cocounsel, Frederick Friedman, were present in court. Straw was also present, as were Gelbard and his counsel, Dieterich. In chambers, Sun recalled that he or Deixler informed Judge Edmon that the parties had resolved the case at the mediation and that there were a few things to do, “but that we all felt that [the judge] could dismiss the jury.” Another lawyer who was in chambers at that time testified that Sun may have mentioned “there was a bankruptcy issue as to Gelbard.” [44]*44But no one, including Straw, suggested the settlement agreement was not enforceable, even though Straw had considered telling his counsel to inform the judge that there was no settlement.

Straw testified that Sun stated in the in-chambers meeting that Gelbard was threatening not to sign a settlement agreement unless he received money and that he might sue Blix Street for malicious prosecution. Straw, although “stunned,” did not state there was no settlement.

After the in-chambers meeting, Judge Edmon took the bench and called for the jury. She informed the jury as follows: “Good morning to everybody. I have some news for all of you. Since the last time we were together, the case has settled .... I can’t overemphasize what an important role all of you played in that. Some cases just can’t settle until they get right up to trial. And it was seeing all of you and actually getting started that got this case to settle.”

After some further comments to the jurors, Judge Edmon dismissed them.

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Cite This Page — Counsel Stack

Bluebook (online)
191 Cal. App. 4th 39, 119 Cal. Rptr. 3d 574, 2010 Cal. App. LEXIS 2137, Counsel Stack Legal Research, https://law.counselstack.com/opinion/blix-street-records-inc-v-cassidy-calctapp-2010.