CBS, Inc. v. Merrick
United States Court of Appeals for the Ninth Circuit
716 F.2d 1292 (1983)
CBS, Inc. (plaintiff) agreed to purchase the television rights to the novel Blood and Money from 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 Merrick. CBS paid $916,666 to Merrick and his agents. Pursuant to the agreement, Merrick hired a director and screenwriter for the project, and CBS paid them $750,000. Merrick 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. CBS brought an action for rescission and restitution. The trial court found that Merrick had refused to perform and breached the contract with CBS. The court awarded restitution damages of the $916,666 CBS paid to Merrick and his agent, but refused to award CBS the $750,000 it paid the director and screenwriter as reliance damages.
Rule of Law
Holding and Reasoning (Solomon, J.)
Concurrence (Nelson, J.)
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