Mendenhall v. Hanesbrands, Inc. - 856 F. Supp. 2d 717 (M.D.N.C. 2012)

Rule:

Judgment on the pleadings is only appropriate when, taking all of the non-moving party's factual allegations as true, no genuine issues of material fact remain and the case can be determined as a matter of law.

Facts:

In May 2008, plaintiff Rashard Mendenhall and defendant Hanesbrands, Inc. entered into a Talent Agreement, whereby defendant would use the services of plaintiff to advertise and promote defendant’s products sold under the Champion trademark. Under Section 17(a) of the Agreement, defendant has a right to terminate the contract if plaintiff became involved in any situation or occurrence that would tend to bring defendant into public disrepute, contempt, scandal, or ridicule, or would tend to shock, insult or offend the majority of the consuming public or any protected class or group thereof. In 2011, plaintiff used his Twitter social media platform to express his views about Islam, women, parenting and relationships, and made comments in which Plaintiff compared the NFL to the slave trade. Subsequently, defendant expressed its intent to terminate the Talent Agreement, averring that plaintiff could no longer appropriately represent the brand. Consequently, plaintiff filed a breach of contract action against defendant, alleging that the latter breached the Talent Agreement by its actions purporting to terminate the Talent Agreement and its failure and refusal to pay amounts due to plaintiff. In its Motion for Judgment on the Pleadings, defendant contended that it was within its rights to terminate the Agreement.

Issue:

Did the Plaintiff failed to state a claim for his breach of contract action, thereby warranting the grant of the defendant’s motion for Judgment on the Pleadings?

Answer:

No.

Conclusion:

Under New York law, in order to state a claim for breach of contract, the Complaint must allege: (1) the existence of a contract, (2) performance by the party seeking recovery, (3) non-performance by the other party, and (4) damages attributable to the breach. With regard to the first element, the parties in the present case did not dispute the existence of a valid and enforceable contract. As to the second element, i.e., whether Plaintiff performed his duties under the Talent Agreement and Extension, the Court found that Plaintiff has alleged enough facts to sufficiently plead this element, in that, Plaintiff has alleged that he was paid in full for the initial term of the contract, that the term of the contract was extended, in part, because of his efforts to promote the Champion brand, and that he remained available to perform his duties under the Talent Agreement and Extension during the extension term even after defendant purported to terminate the Talent Agreement and Extension, as alleged in the Complaint. As to the third element, the Court found that to the extent that the Talent Agreement and Extension provided defendant with discretionary termination rights under Section 17(a), that discretion was subject to the implied covenant of good faith and fair dealing. In this case, the Court found that, at this early stage of the proceedings, Plaintiff has stated at the very least a plausible claim for breach of contract based on the implied covenant of good faith and fair dealing. As such, the Court found that a judgment on the pleadings would be premature at this time and was not warranted given the allegations of Plaintiff’s Complaint.