Remedies Essay #1 Examples
First Example: Part A- Cliff v. Ahmad Legal Remedies Cliff may sue A in tort for misappropriation of his image and story. In this case, the measure of damages will be the amount that will bring C back to his rightful position. C will have the burden of proving how much that amount is going to be- how much he lost as a result of the wrong. He can use expert testimony to determine this. C must be able to demonstrate his losses, with reasonable certainty. However, because this is a problematic in measuring damages, he might be better off seeking a remedy in equity or restitution. Equitable Remedies. Injunctions Courts will generally award equitable injunctions whenever the measurement is hard to determine. In order to determine whether C can sue for an injunction, he must show irreparable harm, balance of hardships tips in favor of him, injunction is not against public policy, and he has likelihood of success on the merits. However, in this case, A has already made his movies have they have been released to the general public. Furthermore, he does not intend to make anymore movies. Therefore, since the harm has already been suffered, C cannot ask for a preliminary injunction. However, he may be able to ask for a permanent injunction that would prevent A from releasing anymore of those DVDs. He would first have to win the substantive case and then the court must determine that damages is not sufficient to put C back into his rightful position. If C feels that his does not want his story told through the Boris movies, then he might get the injunction. HOwever, more likely damages will compensate him for his loss. Declaratory Relief C might seek a declaratory relief action in which he will ask the court to determine that A indeed did use his image to make the movies and that therefore, A cannot make anymore future movies that use his image. In order to get a declaratory relief, C must show that the issue is ripe and that there is a uncertainty at law. Once the Court determines that it will issue a declaratory relief, then C may seek an injunction against A from making future movies and if A does not comply, the court can hold A in contempt. Restitution Disgorgement/accounting for profits Cliff is entitled to the profits that A made on these movies under the theory of restitution. We look at the benefit that A derived from his wrongful act and give that benefit to C. A should not be unjustly enriched by his wrongful act. Plaintiffs generally ask for restitution whenever the D's gain is greater than P's loss. Under accounting for profits, we wil award the profits that A made by misappropriating C's image and give those profits to C. Here, C should be successful in arguing that all profits that were earned by these movies should be awarded to him because A wrongfully took his image, without his permission. The burden will then be on A to apportion the profits to determine what part of C's image contributed to the profits. A will want to argue that he has contributed certain things to the
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movie that lead to its success and C should not be given a windfall by being awarded ALL of these profits. The court will look at certain factors as the actors involved in the movie, the marketing that was invested to make sure that the public went to go see the movie, etc. These factors clearly played a part in the movie's success and C should not be given this portion of the profits. Furthermore, A may also want to deduct overhead costs that went into making the movie. Some jx will not allow an intentional wrongdoer to deduct overhead costs. However, assuming that this jx does allow this, then A will be able to deduct variable costs (the cost to make the movieseg/ cost of film, camera, crew, etc.) and some of the overhead costs (not directly related to the production of the movie eg/ pensions for the crew, rental space, etc.). The court will have to come up a system in which they will categorize the types of overhead costs and determine a fair and reasonable way by which to determine whether those overhead costs can be deducted.
Punitive Damages Cliff might also be able to get punitive damages for A's wrongful, intentional behavior. Under Grimshaw, C must show that A's actions were intentional and the amount of damages will be determined by the amount of compensatory damages, the wealth of A, the amount that will have a deterrent effect, the state penalties for such action, and the reprehensibility of A's action. If Cliff is able to show this, then he can get punitivies. Defense Laches Laches is a defense in equity, in which the Defendant can argue that P should not be able to bring their claim because they sat on their rights for too long. In order to prove laches, the D must show that P knew about the misconduct and choose not to do anything about, for a substantial delay. In this case, A attempted to buy C's story, ten years ago. C declined. Then, C rec'd a letter from A asking him for any advice about the movie that he was making. However, C never responded and went to Antarctica. A will want to argue that C should have reasonable foreseen that he was going to be making a movie about him. He had attempted to buy C's story and then followed up with a letter that let him know that he was planning on making the movie. He should have known that a "rags to riches boxing movie" was about him and should have sought action when he found out. Yet, he never did anything for an entire five years. A will argue that he assumed that he had C's permission to make this movie when he did not respond to the letter and that when he did not file a suit for five years, he assumed he was not going to get sued. C sat on his rights for too long and he should have sued, beforet the movie was made. Therefore, under the doctrine of laches, C should not be allowed to bring this case. On the other hand, C will argue that he refused to let A buy his story and furthermore, he had not idea that A was planning on making the movie. The reasons that he did not assert his rights was because he was out of the country, in a desolate land, for five years and had no access to the outside world. Therefore, when he filed the suit, that was the most soonest that he could have filed it and he should not be prohibited from filing his suit. I would conclude that C would probably win in this arguement because there was little indication that he knew what was going on. SOL
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SOL is a legal defense, where the statute sets a time limit in which a person brings suit. Assuming that the SOL is less than 5 years, A will argue that the time period has passed and C cannot bring the suit because it is barred by the SOL. However, SOL will toll until the time of discovery- the time that C reasonably discovered the misconduct and his injury after due diligence investigation. Here, C had no idea that the movie had been made because he was not in the country. However, as soon as his saw the movie, he filed his suit. The SOL should have started running at the time that C made his discovery. Therefore, C should not be barred by the SOL, if he sues for legal remedies. Estoppel A might be able to argue that C is estopped from bringing this claim because he relied on C's action (or rather, inaction) to his detriment. In order to establish estoppel, there must be an act, reliance on the act, harm, and C must have known about the harm. In this case, the act would have been C's silence after he got the letter (implying that he gave permission). A relied on C's silence as being his permission to make the movie. A relied on it by producing the movie. However, C did not known about the reliance in this case. Therefore, it will be hard for A to argue estoppel. Part B. Ahmad v. Darryl and Earl Legal Remedies A may sue D for legal remedies for the amount that D took from him (the $14K in cash, and the FMV of the oscar). We look at the amount that A lost to determine compensatory damages. A could use to get the oscar back under replevin, however, there is dispute as to whether Earl is a BFP (discussed further below). Because D is insolvent, A will have very little success in collecting his judgment. Therefore, it will be better if A sues in restitution. Constructive Trust of funds Under restitution, we take away any of D's unjust enrichment. If D commits a wrong and take away a specific piece of property, then the court may impose a construction trust in which there is a legal fiction that D is holding the item, in trust for A. Here, Daryl took some cash and commingled it with his own account. A can still get his cash, if he can properly trace it. Whenever there is a coommmingling of cash, there are a few rules that are in place: 1. Wrongdoer spend his own money first 2. wrongdoer invests the victims' money first 3. victim is entitled to the lowest intermediate balance 4. Victim can use any of these rules to his advantage, to get the most gain 5. Whenever there is a subsequent deposit, that will be treated factually. In this case, Darryl took $10K of A's money and placed it in his bank account that already had $3K of his own money (balance- $13K). He then bought a poster for $3000 (balance $10K) Under rule #1 D spend his own money first and so the remaining $10K still belongs to A. He then deposit $4K of his own money (rule #5- this belongs to D) and then deposits $4K of A's money (A now has $14K in the account-total balance in account is $18K). D then buys stock for $5000 and it goes up in value to $10000 (Total balance is $13K). Under rule #2, this stock belongs to A since he invests A's money first. The remaining $13K is spent gambling and there is nothing left in the bank (Total balance is $0). Therefore, since the LIB is $0, A gets nothing
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from the account. However, he does have the $10K in Proofa Co stock. (Also, could argue that D invested A's money to buy the poster and therefore, A could claim the $3000 poster, which is only $1000 in value). A will also try and get the Oscar back under constructive trust. However, because D sold it to a Earl, he may have some trouble. Is Earl a BFP? Under the constructive trust, if the wrongdoer sells the misappropriated property to a BFP, the victim can no longer get the property back. In order to be a BFP, you must prove that you had no notice (didn't know it was stolen item) and you paid full value for it. A will want to argue that because E didn't pay full value, he is not a BFP and A should be able to get the oscar back from E. However, most likely, even though E didn't pay the FMV, he was the top bidder in ebay and paid what was asked for, under the auction. I don't think that is relevant that he would have been willing to pay $5K because E just got a really good bargain on ebay, which happens all the time. Therefore, A will not be able to get the oscar back. However, whenever the wrongdoer sells the item to a BFP, the proceeds from that sale can be traced and given back to the victim. In this case, D got $3K for selling the oscar and therefore, A will be able to get that money from D.
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Second Example: 1) Type the answer to question 1 below. (Essay) Part A Damages The default remedy for any legal claim is the substitutionary remedy of damages. Expectancy and reliance damages flow from a contract, but here there is no contract. Restitution damages are also available, but will be discussed later in equitable claims. This leaves damages arising from tort. While the traditional rule is that tort damages are limited to reliance, the modern rule is that all remedies available under contract are available when suing in tort. Tort damages also allow punitive damages, whereas they are forbidden in contract cases unless there is an independent, underlying tort. There are also noneconomic damages available when a dignitary harm in involved. Assuming that misappropriation of image and story is a tort, Cliff can bring suit for it and ask for noneconomic damages inflicted when Ahmad wrongfully used his likeness, causing shock and embarrassment when Cliff returned to the States and saw his life splayed all over the movie screen. In order to prove this, Cliff would have to show that he has suffered harm - whether that be by showing trips to the psychiatrist, or an inability to eat, etc. This damage award would be subject to remittitur if the amount was so high that it "shocked the conscience of the court" or was out of proportion to the amounts given in similar claims. In addition to noneconomic damages, Cliff may be able to bring a claim for punitive damages. Punitives are allowed where the D has intentionally caused P harm or has substantial disregard for a likelihood that P will be harmed. Here, Cliff can claim that Ahmad knew Cliff wasn't interested in having his story appear on the bigscreen, as evidenced by his decline of Ahmad's original offer, and that Ahmad went on to misappropriate Cliff's story without his approval. This, Cliff can claim, was an action in substantial disregard for injury to Cliff. These claims are pretty weak because it doesn't appear that Cliff has actually suffered any real emotional harm and punitives would likely be very low in relation to the compensatories because the conduct of Ahmad wasn't very reprehensible. Injunction Where a P may suffer irreparable harm as a result of D's actions, the P may request an injunction, subject to ripeness, scope, and mootness concerns. The most immediate injunction is a Temporary Restraining Order, which issues when a P shows that he will suffer irreparable harm RIGHT NOW. That doesn't appear to be the case here, because Ahmad has indicated he's done making movies about Cliff's character. This factor factors in to ripeness and mootness concerns as well. A court will not issue an injunction for lack of ripeness if, in addition to proving that irreparable harm will result from D's conduct, the P cannot prove that the harm is planned and imminent. Again, Ahmad's expressed feeling that he will not be making any movies because the concept is tired seems to indicate that the injunction action is not ripe. In addition, the court requires that there is a cognizable likelihood of damage occuring to the P to ensure that the injunction request is not moot. This mootness analysis hinges on 1. bona fides of D's intent to comply, 2. effectiveness of D's cessation of activity, and 3. character of past violations. Here, the first aspect swings sharply in favor of a mootness ruling, since Ahmad is simply not
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interested in making more movies with Cliff's character. The second factor is mostly neutral because, while Ahmad says he doesn't want to make any more movies, there isn't much that is stopping him from doing so - and we all know how popular sequals are. The third aspect also swings toward mootness because Ahmad's past violations seem to have stemmed from an inability to get in touch with Cliff, or an erroneous assumption as to what Cliff's silence meant. In short, the request for injunction will probably be denied as unripe and moot. Restitution It is fairly apparent from the facts that Ahmad has benefitted from an unjust enrichment. He was clearly interested in Cliff's story (as evidenced by his rebuffed attempt to buy the rights to it) and went on to use those rights profitably without paying for them. When unjust enrichment has occured, the P usually will sue for restitution under a number of theories. Quasi K Here, the court will imply a K where there wasn't one, with an implied promise by Ahmad to adequately compensate Cliff for the rights he used. This is pursuant to the Restatement rule that, where the D has received unjust enrichment, he must restore that benefit to the P. What that looks like here is subject to question. It will probably include some kind of compensation for the initial transfer of the rights (probably in excess of $30K because that amount was insufficient the first go around to get Cliff to part with them) and then a royalty off the amounts that accrued to Ahmad from the making of those movies. Accounting for Profits An accounting for profits is usually imposed where a wrongfully taken item is incorproated into a larger product that is then sold for profit. This action works best when there is a company involved, because costs can be allocated, etc. Here, Cliff will plead unjust enrichment and will move the court to require an accounting for profits from Ahmad, according to his duty under GFI. At that point, Ahmad will have the option to prove apportionment - using a fair and reasonable method - of any costs that Ahmad accrued, not the movie company, in the making of the profits from those movies. In all likelihood, this will be zero. Then Ahmad will have the opportunity to apportion the profits he made from the movie, so as to be liable only for the percentage of profits that are directly attributable to Cliff's story - per Sheldon. Here, Ahmad will want to show that his name and skill as an actor is what accounted for the bulk of the profits and that the story was largely not a factor. In addition, Ahmad can make a good argument that the profits arising from subsequent movies were not at all related to Cliff's story, but were solely the work of the writers that made it up. Constructive Trust A constructive trust is appropriate where property is taken by fraud, misappropriation, or mistake and the property remains identifiable in the hands of the D. Cliff will want to argue that Ahmad misappropriated his image and story and "cashed them in" in return for the money he made on the Boris movies. Cliff will then argue that the amount of money in Ahmad's bank account represents the tangible value of Cliff's likeness and story and that a constructive trust, using tracing, should be imposed to allow Cliff to recover that tangible value. At that point, it would be incumbent upon Cliff to utilize tracing to show that the money in Ahmad's bank account - or
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at least the lowest intermediate balance - belongs to Cliff. This will be extremely difficult to do because the image and story were only a part of the process by which Ahmad made the money he did. The fact that Ahmad mixed his own efforts with his misappropriated story indicates that a constructive trust is largely inappropriate and an accounting for profits or a quasi K would be a better remedy. Equitable Trust An equitable trust is allowed to be imposed by a victim of misappropriation, although it's better used in mistaken improver cases where the underlying property remains in the ownership of the D. The process by which an EL would be imposed follows that of a constructive trust, with the slight improvement that it doesn't require that Ahmad give up his bank account, only that he pay the fair market value of the image and story of Cliff, plus royalties. The EL merely secures Ahmad's duty to pay. But, again, the analysis used to reach that point is very strained and a much better option would be accounting for profits or a quasi K. Ahmad's Defenses Laches Ahmad can argue that laches applies to Cliff's claim. Laches requires an underlying knowledge by P that a claim is available, a substantial delay in bringin that claim, and reliance by the D. Laches seems to fall apart pretty quickly because it is only barely arguable that Cliff knew his claim was available while freezing his keyster off in Antarctica. He clearly had no idea. A substantial delay is obviously met, and it is arguable that Ahmad relied upon the lack of claim, since he may or may not have known that Cliff was out of the country. But the first element makes this pretty weak. Estoppel Ahmad can argue that Cliff is estopped from asserting these rights because he made a misleading action, Ahmad relied upon that action, and Cliff knew of Ahmad's reliance. Again, this is fairly tenuous because Ahmad will have to argue that Cliff's failure to respond misled Ahmad into believing he could make a movie about a rags to riches boxer, et al. Waiver Part B Ahmad v. Daryl A can bring an action for constructive trust. See the analysis above. This will allow him to utilize tracing to recover the $14,000 total he lost to D. Using the tracing fictions that D spends his own money first, invests P's money first, and that P is entitled to the lowest intermediate balance in an intermingled account, the following results. The $3000 he spent on the poster was a bad investment and so A will claim that D spent his own money there. Then, the stock purchase, because it was a good investment, will be allowed to accrue to A's benefit. As a result, the $10,000, which is all that is left of either person's money, will belong entirely to A. Note that A lost $9000 of his money when D blew it - under this model. A could impose a CT, rather than
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an EL, because the constructive trust will allow him to capture the added value of the stock and any value that accrues to it after. But, the EL will allow him a pro rata share of that stock, which in this case is all of it, plus a money judgment for the rest. But, because D is bankrupt, A will have to stand in line with all other creditors and will probably only get pennies on the dollar. I can't think of any defenses D could bring. Ahmad v. Earl A can bring an action for constructive trust, with the analysis the same as above. This falls apart, though, because it appears that Earl can at least raise the claim that he is a bona fide purchaser, which means he bought for value without notice of the adverse claim. While it appears that Earl would have bought the Oscar even if he had known it was genuine, he didn't know it was misappropriated and so a BFP defense will likely prevail. A can also bring an action for replevin. This is a legal remedy that does't require a showing of irreparable harm, but it doesn't carry the potential of contempt - if the sheriff doesn't get the Oscar, that's the end of it. I think the BFP defense holds up against an action for replevin also, though.
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Third Example: Part A – Cliff v. Ahmad C is suing A for misappropriation of his story & likeness, which is a tort. First—cts look to damages to compensate—however-in an intentional tort, like this one, they will let a P elect his remedy. LEGAL C can show general damages and special damages. Cts want to put P’s back in their rightful position. Here C’s rightul position is hard to measure. He turned down an offer for 30k, so it is likely that it is greater, however, these are difficult to ascertain. P also has no emotion or (no proof) other economic dmgs since the movies were positive. Equitible C in addition to other remedies may seek an injunction against A from further use of his image. This could take several forms. TRO C will not be able to get a TRO because there is no urgency. Additionally, C may not be able to get a Preliminary Inj. Because there is a mootness problem. Prelim. Inj To get a PI—C must show - Likelihood of success on merits - irreperable harm (loss of control of image) - balance of hardships in C’s favor - Public Policy Additionally—for a reparative inj—since there has already been harm—C must show that it is not moot & that that continued harm is planned & imminent. Here—A has stated an intent not to make further infringements. –But if there is no inj A could still be in a position to make another one. Additionally—there is a question of whether the harm is truly irrep. Since this infringement has been going on, it is quantifiable, and money damages are sufficient, unless, like the Continental Case,there is irrep injury when you lose control of your image. DP is probably for giving C a prospective inj against new harm, but probably wont allow the past infringements to be enjoined (by making A collect all the old movies)—this is probably impossible since they are on DVD. If C can show that the issue is not moot, and that A by his conduct is planning more infringing movies & they are imminent (ripeness) then P can probably get a prelim inj stopping additional movies. Restitution C’s best remedy will be in restitution because there he gets to look at the D (A)’s unjust enrichment & put A in HIS rightful position. C would most like to get an Accounting for Profit allowing him to receive all of the misappropriated benefit through quasi-K (like-snepp). Here the Ct probably would not give C
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all, because in equity the Ct will look at the wrongfulness of A’s conduct. There also was no Fid. Relationship breached. While A knew C turned down 30k, he also never heard back from C when he tried to get in touch. So, C will probably get something, through Appointment, but not everything. In apportionment the P must show gross receipts from infr. Item. Then D will show his efforts & expenses & put experts on to testify as to the value added by P’s item. Here C must present the receipts. A will claim that people come to see him, so C’s contribution is small. But, this may have been his big break, so the ct will have to decide. A will also try to get overhead—in addition to expenses—since his conduct wasn’t that bad. A will have to show a nexus btwn overhead & movies. A’s Defenses Laches A may claim C sat on his rights since he know about a movie, but did nothing—but A can’t show C knew the movie infringed on his rights. A may have relied, but not reasonably. Waiver By not responding to A’s letter C was expressing an intent not to pursue legal interest. C can probably rebut this. The intent here isn’t clear enough Estoppel Misleading act—not responding Reliance—making series of movies C knew of reliance—here is the problem. C didn’t know movie was his life. C will probably get to apportion A’s movie profits after an accounting & A gets to deduct expenses C can get an inj from future use Part B A v. D Dmgs A will want to sue D for stealing his $ & personal property. Usually A might only get damages—however, with D declaring bankruptcy, this is inadequate. Punitives As there is fraud, A might want punis, however, D’s insolvency makes that impractical. Constructive-Trust A’s best remedy will be a Constructive Trust or Equitable Lien. $ He can trace the stolen $ to D’s bank acct where it was commingled w/ D’s funds. There A can apply the 3 fictions of const-trust When an asset has been misappropriated 1. D spends own $ 1st 2. D invests P’s $ 1st 3. LIB—P gets lowest int balance btwn wrongful taking & just.
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Here— By the time A knows—D’s acct is empty—so he cant get LIB. However—D made 2 investments while D & A’s funds were commingled- The Poster—& the stock. Because - The stock is now worth 10k & the poster is worth 1k A will want to get an Equitable Lien on the poster—so he can get a just & get preference in Bankruptcy. When D bought the Poofta stock—there was 18k in the account, so A will want a Constructive Trust over that so he can get the stock. Since D committed fraud & had a fiduciary duty to A as his manager/Agent—a Ct is more likely to use these remedies. Also—A can trace the proceeds From the sale of his oscar and get those if he can find the 3k. A v. E A may try to sue E for Replevin or under a Const. Trust. However—as a BFP—Since E paid consideration & had no notice of the fraud, A will probably fail. Defenses— D may say that the length of time he’d been doing it shows laches. Hwvr—there is no indication that A knew or should have known. A could probably argue fraudulent concealment if D tried to stop him from knowing. __________ A can get poster, stock & proceeds from Oscar A can’t get Oscar
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