Opinion ID: 346865
Heading Depth: 2
Heading Rank: 1

Heading: The VIRGIN Agreement.

Text: 36 Judge Owen charged the jury as a matter of law that Famous breached the VIRGIN agreement by assigning it to ABC without getting from ABC a written agreement to be bound by the terms of the VIRGIN agreement. A reading of paragraph 29 of the agreement 7 reveals that that charge was entirely correct, and Famous does not challenge it on this appeal. Famous vigorously contends, however, that the jury's conclusion, that it had failed to adequately promote VIRGIN prior to the sale to ABC, is at war with the undisputed facts and cannot be permitted to stand. O'Connor v. Pennsylvania R.R. Co., 308 F.2d 911, 915 & n.5 (2d Cir. 1962). In particular they argue that they spent the required $50,000 8 and appointed the required overseer for the project. 9 The flaw in this argument is that its focus is too narrow. The obligations to which it refers are but two of many created by the VIRGIN agreement. Under the doctrine of Wood v. Lucy, Lady Duff-Gordon, 222 N.Y. 88, 118 N.E. 214 (1917), Famous had an obligation to use its reasonable efforts to promote VIRGIN on a nationwide basis. That obligation could not be satisfied merely by technical compliance with the spending and appointment requirements of paragraph 14 of the agreement. Even assuming that Famous complied fully with those requirements, there was evidence from which the jury could find that Famous failed to adequately promote VIRGIN. The question is a close one, particularly in light of Martell's obvious commitment to the success of VIRGIN and in light of the efforts that were in fact exerted and the lack of any serious dispute between the parties prior to the sale to ABC. However, there was evidence that Famous prematurely terminated the promotion of the first single record, Got To Know, shortly after its release, and that Famous limited its promotion of the second record, Kyrie, to a single city, rather than promoting it nationwide. 10 Moreover, there was evidence that, prior to the sale to ABC, Famous underwent a budget reduction and cut back its promotional staff. From this, the jury could infer that the promotional effort was reduced to a level that was less than adequate. On the whole, therefore, we are not persuaded that the jury's verdict should be disturbed. 37