Turner Broadcasting System, Inc. v. Mcdavid

693 S.E.2d 873 (2010)

Purchase the Printed Copy at bsmsphd.com

Nature of the Case

To access this section all you need to do is click here and register.

Facts

D publicly announced its interest in selling The Atlanta Hawks, and Atlanta Thrashers as well as rights to the Philips Arena. P expressed an interest in buying the assets and entered into negotiations with D. The parties executed a 'Letter of Intent,' outlining the proposed sale terms and establishing a 45-day exclusive negotiating period. The Letter of Intent expired with no agreement, but the parties continued to negotiate. P wanted to extend the letter of intent, but D told him, 'Don't worry about it. We're very, very close to a deal. You're our guy.' In mid-July 2003, expecting that they would be able to resolve all of the outstanding issues and finalize their agreement, D raised a tax loss allocation issue, which the parties failed to resolve. D walked out of the meeting, while his advisors continued their efforts to resolve the tax issue. On July 30, 2003, during a conference call, P's advisors stated that P would agree to D's proposed resolution of the tax issue on the condition that it would resolve all the issues and finalize the deal. D's CEO agreed and announced, 'we have a deal.' They exchanged multiple drafts of the purchase agreement and its exhibits. During the legal drafting process, the parties' counsel identified additional 'open issues' for the written agreements. D planned for a press conference to publicly announce the deal with P. D consulted with P and his advisor on team management decisions, including the hiring of a general manager and a head coach for the Hawks. D also obtained P's approval before hiring a trainer, assistants, and scouts. On August 16, 2003, D's executive and principal negotiator, James McCaffrey, approached P about a simplified restructure for the transaction, assuring him that the restructure would 'not change the deal,' that the 'deal was done,' and that 'they were ready to close on the deal that [they] made on July 30th.' P agreed to the simplified restructure, and the attorneys circulated revised draft agreements that reflected the restructured terms. On August 19, 2003, the corporate board of directors of Time Warner approved the sale of the assets. Ted Turner and Steve Case, opposed the deal, concerned that the assets had been undervalued and had resulted in a 'fire sale.' D was approached by new buyers, and while D continued to exchange drafts of the purchase agreement with P, it also began negotiations with Atlanta Spirit. P and D verbally reached a final agreement on each of the alleged open items for the written agreement and D's principal negotiator announced, 'the deal is done. Let's get documents we can sign, and we'll meet in Atlanta for a press conference and a closing [early next week].' Later that same day, D's principal negotiator and its in-house counsel signed an agreement for the sale of the assets to Atlanta Spirit. P filed suit alleging claims of breach of an oral contract to sell the assets, promissory estoppel, fraud, and breach of a confidentiality agreement. D denied the existence of any binding agreement, arguing that the parties had not executed a final written purchase agreement and had continued to negotiate the material terms of the transaction. P got the verdict on the breach of oral contract claim and was awarded $ 281 million in damages. D appealed. D argues that the $281 million judgment entered upon the verdict must be reversed since the jury's damages award was speculative, excessive, and decidedly against the weight of the evidence.