Power Entertainment, Inc. v. National Football League Properties, Inc.

151 F.3d 247 (5th Cir. 1998)

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Nature of the Case

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Facts

Pro Set had a licensing agreement with D to market NFL cards bearing the statement 'official card of the National Football League.' Pro Set filed for bankruptcy. It owed D approximately $800,000 in unpaid royalties from card sales. P met with D to discuss taking over the licensing agreement. P alleges that D orally agreed to transfer Pro Set's license to P in return for P's agreement to assume Pro Set's debt to D. D subsequently refused to transfer the licensing agreement. P sued D seeking damages for amounts spent in reliance on the alleged agreement and for lost profits. D removed the suit to federal district court. The district court then granted D's motion to dismiss. P's contract claim failed as a matter of law because it was not in writing and P had failed to plead facts sufficient to support an estoppel claim. The district court concluded that the 'suretyship' statute of frauds rendered the alleged oral agreement between P and D unenforceable because P promised to assume Pro Set's debt to D as part of the alleged oral agreement. The relevant statute provides that 'a promise by one person to answer for the debt, default, or miscarriage of another person' must be in writing. The district court denied P's motions for reconsideration and new trial. P appealed.