Court Opinion

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Opinions of the United
1999 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit

9-2-1999

Pacitti v. Macy's
Precedential or Non-Precedential:

Docket 98-1803

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Recommended Citation
"Pacitti v. Macy's" (1999). 1999 Decisions. Paper 246.
http://digitalcommons.law.villanova.edu/thirdcircuit_1999/246

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Filed September 2, 1999

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

No. 98-1803

JOANNA PACITTI, a minor, by JOSEPH PACITTI, and STELLA PACITTI, her
parents and guardians,

Appellants

v.

MACY'S; MACY'S EAST, INC.

ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT
OF PENNSYLVANIA

(D.C. No. 97-cv-02557) (District Judge: Honorable James T. Giles)

Argued: July 15, 1999

Before: GREENBERG, ALITO, Circuit Judges, and STAFFORD, District Judge*

(Opinion Filed: September 2, 1999)

ALFRED W. PUTNAM, JR. (argued) Drinker, Biddle & Reath 1345 Chestnut
Street Philadelphia
National Bank Building Philadelphia, PA 19107-3496

_________________________________________________________________ *The
Honorable
William H. Stafford, Jr., United States District Judge for the Northern
District of Florida, sitting by
designation.

ALBERT C. OEHRLE One East Airy Street

P.O. Box 657 Norristown, PA 19404

JOSEPH F. CLAFFY Joseph F. Claffy & Associates, PC 100 S. High Street West
Chester, PA 19382

Counsel for Appellants

ROBERT P. JOY (argued) DIANE M. SAUNDERS Morgan, Brown & Joy, LLP

One Boston Place, Suite 1616 Boston, MA 02108-4472

JAMES M. PENNY, JR. Obermayer Rebmann Maxwell & Hippel LLP One Penn Center
- 19th Floor
1617 John F. Kennedy Boulevard

Philadelphia, PA 19103-1895
Counsel for Appellees

OPINION OF THE COURT

ALITO, Circuit Judge:

Stella and Joseph Pacitti, on behalf of their daughter, Joanna Pacitti
("plaintiffs"), appeal the District Court's

grant of summary judgment in favor of Macy's East, Inc. ("Macy's") on
their state-law contract and tort
claims arising from Macy's role as promoter and host of "Macy's Search for
Broadway's New `Annie' " (the
"Search"). Plaintiffs also appeal the District Court's order limiting the
scope of

discovery. For the reasons that follow, we reverse on both grounds and
remand for further proceedings.

I.

In May 1996, the producers of "Annie," the Classic Annie Production
Limited Partnership (the "producers"),
and Macy's, a retail department store chain, entered into an agreement
under which Macy's agreed to
sponsor the "Annie 20th Anniversary Talent Search." See App. at 129a- 32a.
Specifically, Macy's agreed
to promote the event and to host the auditions at its stores in the
following locations: New York City,
Boston, Atlanta, Miami, and King of Prussia, Pennsylvania. See id. at
129a-30a. The producers agreed to
select one finalist from each regional store to compete in a final
audition at Macy's Herald Square store in
New York City. See id. at 130a. The producers also agreed to offer the
winner of the final audition "a
contract for that role to appear in the 20th Anniversary Production of
Annie .. ., subject to good faith
negotiations and in accordance with standard Actors' Equity Production
Contract guidelines" (the "standard
actors' equity contract"). 2 Id.

Macy's publicized the Search in newspapers and in its stores in the five
regional locations. All of the
promotional materials referred to the event as "Macy's Search for
Broadway's New `Annie.' " See id. at
59a-83a. Plaintiffs learned of the Search from an advertisement in the
Philadelphia Inquirer that stated, in
pertinent part:

If you are a girl between 7 and 12 years old and 4 *6 or under, the
starring role in this 20th
Anniversary Broadway production and national tour could be yours! Just get
your hands on an application .
. . and bring it to the audition at Macy's King of Prussia store. . . .
Annie's director/lyricist . . . will pick the
lucky actress for final callbacks . . . at Macy's Herald Square. Annie
goes on the road this fall and opens on
Broadway Spring 1997.
_________________________________________________________________

2. The Actors' Equity Association requires producers to attach its
standard "Agreement and Rules
Governing Employment under the Production Contract" to "all contracts
where production is bonded as a
Bus and Truck Tour." See App. at 141a. As we discuss below, that contract
provides, among other things,
that the producer retains the authority to replace the actor at any time
so long as the actor is compensated
through the term of the contract. See id. at 168a. Id. at 208a.

In June 1996, Joanna, then 11-years old, and her mother picked up an
application at the King of Prussia
store. The application form announced:

Annie, America's most beloved musical[,] and Macy's, the world's largest
store, are conducting a talent
search for a new "Annie" to star in the 20th Anniversary Broadway
production and national Tour of Annie. .
. .

Id. at 22a. The reverse side of the application form contained the
"Official Rules [of] Macy's Search for
Broadway's New `Annie.' " See id. at 23a. In addition to explaining the
two-part audition process, the
official rules provided, in relevant part:

1. All participants must be accompanied by a paren t or legal guardian and
must bring completed application
forms to one of the Macy's audition locations . . . and be prepared to
audition. . . .

2. The "Annie" selected at the "Annie-Off -Final Callback" will be
required to work with a trained dog. The
tour commences in Fall 1996, with a Broadway opening tentatively scheduled
for Spring 1997, [and] with a
post-Broadway tour to follow.

***

6. [Y]ou and your parent or legal guardian a re responsible for your own
conduct, and hereby release
Macy's . . . and the Producers . . . from any liability to or with regard
to the participants and/or her parent or
legal guardian with respect to the audition(s).

***
8. All determinations made by the Producers or the ir designated judges
are being made at their sole
discretion and each such determination is final.

Id.3 Unlike Macy's contract with the producers, neither the

(Text continued on page 6)
_________________________________________________________________

3. Because the District Court relied heavily on the official rules in
rendering its decision, we provide them
here in full: 1. All participants must be accompanied by a paren t or
legal guardian and must bring completed
application forms to one of the Macy's audition locations on the dates and
times listed on the reverse of this
form and be prepared to audition. Only one parent or legal guardian may
accompany each participant.

2. The "Annie" selected at the "Annie-Off -Final Callback" will be
required to work with a trained dog. The
tour commences Fall 1996, with a Broadway opening tentatively scheduled
for Spring 1997, [and] with a
post-Broadway tour to follow. Parent(s) or guardian(s) will accompany tour
children. Additional information
on arrangements for the final call-back and show rehearsals and
performances will be provided to each
regional finalist selected to attend the "Annie-Off-Final Callback"
audition in New York City.

3. By participating, you agree to follow these Official Rules and you
consent to the taking of a photograph,
for identification purposes only. You also agree that Macy's (and/or a
Macy's designee) may use your name,
likeness, biographical data and /or [sic] voice for advertising,
promotional activities and/or publicity, whether
or not related to the audition and also acknowledge that such use requires
neither any further permission nor
any compensation. Participants who are members of Actors' Equity
Association must identify themselves to
an event representative as such, and will not be audio or video taped
during the audition process. All
application forms are the sole property of Macy's and Macy's is not
responsible for any lost, destroyed,
incomplete, illegible or otherwise deficient or unusable application
forms.

4. In order to participate in the audition, you mu st complete and return
the reverse application form, be a
U.S. resident, between the ages of 7 and 12 as of June 2, 1996[,] and you
must be available for the final
audition on Thursday, August 8, 1996[,] in New York City.

5. Macy's may require that you verify your date of birth and may require
that you provide a certified copy of
your birth or baptismal certificate, school records or other document that
states your date of birth.

6. Participants' parents or legal guardians are re sponsible for any tax
obligations and expenses you may
incur (such as the cost of travel or hotel accommodations) for the initial
audition. The Classic Annie
Production Limited Partnership (the "Producers") will provide travel and
hotel accommodations to finalists
selected for the "Annie- official rules4 nor any of the promotional
materials included a provision informing the
participants that the winner of the Search would receive only the
opportunity to enter into a standard actors'
equity contract with the producers.

Joanna and her mother signed the official rules and proceeded to the
initial audition at the King of Prussia
store. Macy's publicized the event by placing balloons, signs, pins, and
other promotional materials
advertising "Macy's Search for Broadway's New `Annie' " throughout the
store. After auditioning hundreds
of "Annie" hopefuls, the producers selected Joanna as the regional
finalist. In a press release, Macy's
announced Joanna's success to the public: "One in Ten She'll Be a Star!!!
Macy's Brings Local Girl One
Step Closer Towards `Tomorrow' to Become Broadway's New `Annie.' " Id. at
77a. The press release
further provided:

Philadelphia's own, twelve year-old Joanna Pacitti, will join nine other
talented girls for a final audition to
cast the title role in the 20th Anniversary production of the classic Tony
Award-winning musical, Annie,
coming to Broadway this season. . . . Ten finalists, most of whom were
selected from over two thousand
"Annie" hopefuls
_________________________________________________________________

Off " call-back in Macy's Herald Square on Thursday, August 8, 1996. In
addition, you and your parent or
legal guardian are responsible for your own conduct, and hereby release
Macy's East, Inc., its affiliates and
each of their respective officers, directors, employees, agents,
successors and assigns (for purposes of this
Paragraph 6, all included within the term "Macy's") and the Producers and
their successors and assigns from
any liability to or with regard to the participants and/or her parent or
legal guardian with respect to the
audition(s).

7. The audition is subject to all applicable laws and regulations.

8. All determinations made by the Producers or the ir designated judges
are being made at their sole
discretion and each such determination is final.

App. at 23a.

4. Throughout the remainder of this opinion, we refer to the official
rules and the application form as the
"official rules." . . ., will vie for the chance to become Broadway's new
"Annie."

Id. (emphasis in original).

At the producers' expense, Joanna and her mother traveled to New York City
for Joanna to participate in
the "Annie-Off-Final Call Back" at Macy's Herald Square store. After
auditioning for two days, the
producers selected Joanna to star as "Annie" in the 20th Anniversary
Broadway production. Again, Macy's
announced Joanna's success to the public, referring to her as "Broadway's
New `Annie.' " See id. at
59a-83a.

Joanna and her mother met with the producers and signed an "Actors' Equity
Association Standard
Run-of-the- Play Production Contract." See id. at 133a-68a. Consistent
with the Actors' Equity
Association's rules governing production contracts, the producers retained
the right to replace Joanna with
another actor at any time as long as they paid her salary through the term
of her contract. See id. at 168a.

For nearly a four-month period, Joanna performed the role of "Annie" in
the production's national tour. In so
doing, Joanna appeared in over 100 performances and in six cities. In
February 1997, approximately three
weeks before the scheduled Broadway opening, the producers informed Joanna
that her "services [would]
no longer be needed," and she was replaced by her understudy. Id. at 12a.

On March 21, 1997, plaintiffs filed suit against Macy's in Pennsylvania
state court, alleging breach of
contract and the following tort claims: (1) fraudulent misrepresentation,
(2) equitable estoppel, (3) public
policy tort, (4) breach of implied covenant of good faith and fair
dealing, and (5) punitive damages. See id.
at 15a-21a. In particular, plaintiffs alleged that Macy's failed to
deliver the prize it had offered, i.e., the
starring role of "Annie" on Broadway, and that Macy's knew it could not
award this prize but promoted its
ability to do so nonetheless. See id. Macy's subsequently removed the suit
to federal district court based on
diversity. During discovery, plaintiffs sought to uncover information on
the relationship between Macy's and
the producers and on the pecuniary benefit Macy's received from sponsoring
the Search. Macy's objected
to their request, and the District Court limited discovery to "what
promises, if any, were made by defendant
prior to and at the final audition . . . in New York City that the person
selected at that audition would appear
in the role as Annie." Id. at 38a. Plaintiffs moved for reconsideration,
and the District Court denied that
motion on December 19, 1997. See id. at 50a.

Macy's then moved for summary judgment, contending that it did not deprive
Joanna of any prize she had
been promised and that her rights were limited by the terms of her
contract with the producers. See id. at
24a, 126a. In support of its motion, Macy's proffered, among other things,
its contract with the producers,
which, as explained above, specified that the successful contestant would
receive only the opportunity to
enter into a standard actors' equity contract with the producers.

The District Court granted summary judgment in favor of Macy's. See
Pacitti v. Macy's, No. Civ. A.
97-2557, 1998 WL 512938 (E.D. Pa. Aug. 18, 1998). Addressing plaintiffs'
breach of contract claim, the
District Court concluded that the contract was unambiguous and capable of
only one reasonable
interpretation -- i.e., that Macy's offered only an audition for the
opportunity to enter into a standard actors'
equity contract with the producers for the title role in "Annie." See id.
at *3-4. Therefore, the Court rejected
plaintiffs' contention that Macy's offered Joanna a guaranteed Broadway
opening, see id. at *4, and the
Court concluded:

Plaintiffs received the benefit of their bargain by being offered a
contract with the Producers for the "Annie"
role, in exchange for Ms. Pacitti participating in "Macy's Search for
Broadway's New Annie." . . . When the
Producers offered a contract to Plaintiffs consistent with the terms of
the Official Rules[,] any possible
obligation Macy's had to Plaintiffs was fully met.

Id. After rejecting plaintiffs' breach of contract claim, the District
Court turned to their tort claims. See id.
Reasoning that each cause of action was predicated upon the assertion that
Macy's offered Joanna the role
of"Annie" on Broadway, and concluding that Macy's made no such
representation, the District Court
granted Macy's motion for summary judgment on these claims as well. See
id.

Plaintiffs then took this appeal. In their notice of appeal, plaintiffs
state only that they appeal from the District
Court's order granting summary judgment for Macy's. See App. at 235a. In
this appeal, however, plaintiffs
also argue that the District Court abused its discretion in limiting the
scope of discovery.

II.

A. We turn first to plaintiffs' argument that th e District Court erred in
granting summary judgment in favor of
Macy's on the breach of contract claim. We exercise plenary review over a
grant of summary judgment and
apply the same legal standard used by the District Court. See Hullet v.
Towers, Perrin, Forster & Crosby,
Inc., 38 F.3d 107, 111 (3d Cir. 1994). In so doing, we evaluate the
evidence in the light most favorable to
the nonmoving party and draw all reasonable inferences in that party's
favor. See id. We conclude that the
District Court erred.

Under the law of Pennsylvania,5"[t]he promoter of a [prize-winning]
contest, by making public the
conditions and rules of the contest, makes an offer, and if before the
offer is withdrawn another person acts
upon it, the promoter is bound to perform his promise." Cobaugh v. Klick-
Lewis, Inc., 561 A.2d 1248,
1249 (Pa. Super. Ct. 1989) (quoting Annotation, Private Rights and
Remedies Growing Out of
Prize-winning Contests, 87 A.L.R. 2d 649, 661). An
_________________________________________________________________

5. Because the laws of New York and Pennsylvania are identical in all
aspects material to the resolution of
this case, and because the parties do not assert a preference for the law
of one jurisdiction over the other,
we, like the District Court, will not engage in a choice of law analysis.
See Pacitti v. Macy's, No. Civ. A.
97-2557, 1998 WL 512938, at *2 n.2 (E.D. Pa. Aug. 18, 1998). In addressing
plaintiffs' breach of
contract claim, however, we refer only to the law of Pennsylvania. offer
has been defined as "a manifestation
of willingness to enter into a bargain, so made as to justify another
person in understanding that his assent to
that bargain is invited and will conclude it." Cobaugh, 561 A.2d at 1249
(citing Restatement (Second) of
Contracts § 24; 8 P.L.E. Contracts § 23). The offer to award a prize
results in an enforceable contract if the
offeree performs the required action before the offer is withdrawn. See
id.

Here, the parties entered into an enforceable contract under Pennsylvania
law. Macy's offered girls the
opportunity of becoming "Broadway's New `Annie' " by participating in and
winning the auditions, and
Joanna participated in and won the auditions. Therefore, the dispute in
this appeal relates to the parties'
interpretation of that contract and, in particular, to the question
whether the District Court properly found
that the contract is unambiguous. Determining whether a contract is
ambiguous is a legal question, and our
review is plenary. See Mellon Bank, N.A. v. Aetna Business Credit, Inc. ,
619 F.2d 1001, 1011 (3d Cir.
1980).

The purpose of contract interpretation is to ascertain and effectuate the
objectively manifested intentions of
the contracting parties. See Hullet v. Towers, Perrin, Forster & Crosby,
Inc., 38 F.3d 107, 111 (3d Cir.
1994) (citing Mellon Bank, 619 F.2d at 1009). The court first determines
whether the contract is
ambiguous. See Hullet , 38 F.3d at 111 (citing Stendardo v. Federal Nat'l
Mortgage Ass'n, 991 F.2d 1089,
1094 (3d Cir. 1993)). A contract is ambiguous if it is capable of more
than one reasonable interpretation.
See Mellon Bank, 619 F.2d at 1011 (defining ambiguity as an
"[i]ntellectual uncertainty [or] the condition of
admitting two or more meanings, of being understood in more than one way,
or referring to two or more
things at the same time. . . ."). If the contract as a whole is
susceptible to more than one reading, the
factfinder resolves the matter. See Hullet, 38 F.3d at 111. On the other
hand, where it is unambiguous and
can be interpreted only one way, the court interprets the contract as a
matter of law. See id.

In determining whether a contract is ambiguous, the court "assumes the
intent of the parties to an instrument
is `embodied in the writing itself, and when the words are clear and
unambiguous the intent is to be
discovered only from the express language of the agreement.' " Id. (citing
County of Dauphin v. Fidelity &
Deposit Co., 770 F. Supp. 248, 251 (M.D. Pa.), aff 'd, 937 F.2d 596 (3d
Cir. 1991)). This does not
mean, however, that the court is confined to the "four corners of the
written document." Hullet, 38 F.3d at
111 (citing Mellon Bank, 619 F.2d at 1011). Rather, the court reads the
contract in the context in which it
was made. See Hullet, 38 F.3d at 111 (citing Steuart v. McChesney, 444
A.2d 659, 662 (Pa. 1982)).
Therefore, to determine the parties' intentions, the court may consider,
among other things, "the words of the
contract, the alternative meaning suggested by counsel, and the nature of
the objective evidence to be
offered in support of that meaning." Hullet, 38 F.3d at 111 (quoting
Mellon Bank, 619 F.2d at 1011).

In this case, the District Court concluded that the contract was
unambiguous and capable of only one
reasonable interpretation -- i.e., that Macy's offered only an audition
for the opportunity to enter into a
standard actors' equity contract with the producers for the title role in
"Annie." See Pacitti v. Macy's, No.
Civ. A. 97-2557, 1998 WL 512938, at *3-4 (E.D. Pa. Aug. 18, 1998). In
reaching this conclusion, the
Court noted that the official rules repeatedly referred to the promotion
as an "audition," as opposed to a
"contest," and vested "sole discretion" in the producers to make final
determinations. See id. at *3. Hence,
the District Court found that "Plaintiffs could not reasonably have relied
upon Macy's as the selector of
`Annie' or as a controller of the Producers," id., and that "it was
obvious that Macy's was promoting
auditions for the benefit of the Annie Producers." Id. at *4. The District
Court also found that plaintiffs
"knew that while Macy's was promoting the search, it was not the entity
that would be contracting with the
new `Annie.' " Id. at *3. Rather, the District Court noted, plaintiffs
"wholly expected" to sign a standard
actors' equity contract with the producers and, according to the Court,
their expectation is evidenced by the
fact that they executed such a contract after Joanna won the Search. See
id. The Court explained further:

The contract which she signed with the Producers did not guarantee her
that she would open on Broadway,
but instead considered her to be like every other actor in "Annie" who had
won their role through an audition
process but could be replaced at the Producers' discretion pursuant to the
standard equity contract.
943Id. Therefore, the District Court rejected plaintiffs'

contention that Macy's offered Joanna a guaranteed Broadway opening, see
id. at *4, and the Court
concluded:

Plaintiffs received the benefit of their bargain by being offered a
contract with the Producers for the "Annie"
role, in exchange for Ms. Pacitti participating in "Macy's Search for
Broadway's New Annie." . . . When the
Producers offered a contract to Plaintiffs consistent with the terms of
the Official Rules[,] any possible
obligation Macy's had to Plaintiffs was fully met.

Id.

Applying the standards discussed above, we conclude that the District
Court erred in determining that the
contract was capable of only one reasonable interpretation. Plaintiffs'
interpretation -- that Macy's offered
the prize of performing as "Annie" on Broadway for at least some period --
is a reasonable alternative to that
of the District Court.
The official rules and promotional materials referred to the promotion as
"Macy's Search for Broadway's
New `Annie.' " The official rules provided that the producers and Macy's
were "conducting a talent search
for the new `Annie' to star in the 20th Anniversary Broadway production,"
and the advertisement in the
Philadelphia Inquirer promised that "[t]he starring role in this 20th
Anniversary Broadway Production and
National Tour could be yours!" From these assertions, one reasonably could
conclude that Macy's offered
the winner of the Search the prize of starring as "Annie" on Broadway. In
addition, the use of the word
"audition," as opposed to "contest," in the official rules does not make
plaintiffs' interpretation unreasonable.
As plaintiffs assert:

[T]he word `audition' refers to the process a contestant must undergo
before she can `win' the prize. . . . It
follows, one would think, the girl selected after the `final audition' has
won something more than an
`audition.' Appellants' Br. at 20-21 (emphasis in original).

Moreover, it is not unreasonable to conclude that Macy's had the ability
to offer the winner of the Search the
starring role on Broadway. The official rules provided that:

Annie, America's most beloved musical[,] and Macy's, the world's largest
store, are conducting a talent
search for a new "Annie" to star in the 20th Anniversary Broadway
production and national Tour of Annie. .
. .

App. at 22a (emphasis added). That passage suggests that Macy's and the
producers jointly promoted and
hosted the Search. It does not indicate any relative imbalance of
authority in favor of the producers. Nor do
we believe that the clause vesting "sole discretion" in the producers
supports only the interpretation that the
producers were "the sole determiners of the Annie role." Pacitti, 1998 WL
512938, at *3 (emphasis
added). Rather, that clause can be interpreted more narrowly as only
restricting Macy's from selecting the
winner of the auditions.

Further, Macy's at no point revealed -- either through its printed
materials or other means -- that the winner
of the Search would receive only the opportunity to sign a standard
actors' equity contract with the
producers. 6 Nor do the facts suggest that plaintiffs -- none of whom was
a member of the Actors' Equity
Association -- had any knowledge greater than that provided by Macy's. 7
We do not believe that Macy's
role was so "obvious" that it need not
_________________________________________________________________
6. Macy's should have manifested its intention in the contract by limiting
or qualifying its offer accordingly.
See Cobaugh , 516 A.2d at 1250-51 (noting that it is the duty of the
drafter of the contract to exercise due
care in explaining its offer so as not to mislead the public); Hutchinson
v. Sunbeam Coal Corp., 519 A.2d
385, 390 n.5 (Pa. 1986) ("[I]n determining the intention of the parties to
a written contract, the writing must
be construed against the party drafting the document."). 7. We disagree
with the District Court's assertion
that based on the general release clause, it is clear that plaintiffs"knew
that while Macy's was promoting the
search, it was not the entity that would be contracting with the new
`Annie.' " Pacitti, 1998 WL 512938, at
*3. That clause provides:

[Y]ou and your parent or legal guardian are responsible for your own
conduct, and hereby release Macy's .
. . and the Producers . . . from any liability to or with regard to the
participants and/or her parent or legal
guardian with respect to the audition(s).

App. at 23a. As is clear from the language quoted above, that clause not
only releases Macy's but also the
producers. have limited its offer to the public, and we find it telling
that Macy's contract with the producers
contained qualifications on the prize to be offered. Therefore, we
conclude that it was reasonable for
plaintiffs to believe that Macy's offered the starring role of "Annie" on
Broadway.

We reach this conclusion even though plaintiffs executed a standard
actors' equity contract with the
producers. Courts may consider the subsequent actions of the contracting
parties to ascertain the parties'
intentions and resolve any ambiguities. See Department of Transp. v.
Mosites Constr. Co., 494 A.2d 41, 43
(Pa. Commw. Ct. 1985) ("The intention of the parties must control the
interpretation of the contract but if
the intent is unclear from the words of the contract, we may examine
extrinsic evidence including
consideration of the subject matter of the contract, the circumstances
surrounding its execution and the
subsequent acts of the parties."); see also In re Estate of Herr, 161 A.2d
32, 34 (Pa. 1960). Joanna's
contract with the producers, however, does not demonstrate plainly and
unambiguously that when plaintiffs
contracted with Macy's, they "wholly expected" to execute a standard
actors' equity contract with the
producers.

For these reasons, we hold that the contractual language is ambiguous, and
its interpretation should be left to
the factfinder for resolution. Accordingly, the District Court erred in
concluding that Macy's is entitled to
judgment as a matter of law.

B. Macy's also contends that plaintiffs' claims ar e barred by the express
release in the official rules. The
official rules provide, in pertinent part:

[Y]ou and your parent or legal guardian are responsible for your own
conduct, and hereby release Macy's .
. . and the Producers . . . from any liability to or with regard to the
participants and/or her parent or legal
guardian with respect to the audition(s).

App. at 23a. That paragraph simply releases Macy's from liability "with
respect to the audition(s)." It does
not allow Macy's to escape liability arising from this action. We
therefore reject Macy's contention. C. With
respect to the tort causes of action, plai ntiffs maintain that the
District Court erred in granting summary
judgment. As noted above, the District Court dismissed these claims
because it had rejected the predicate
upon which each claim was based, i.e., that Macy's offered the successful
participant the role of "Annie" on
Broadway. See Pacitti, 1998 WL 512938, at *4. Because we conclude that the
contract reasonably may
be interpreted to make such an offer, we reverse on these claims as well
and remand for further
proceedings.

III.

We now turn to plaintiffs' contention that the District Court abused its
discretion by limiting the scope of
discovery.8 Specifically, plaintiffs argue that the District Court's
discovery order precluded them from
uncovering facts relevant to their fraudulent misrepresentation claims.
Macy's asserts that review of this issue
is improper and, in the alternative, that the District Court's order was a
proper exercise of discretion. We
conclude that review is appropriate and that the District Court abused its
discretion.

A. As a preliminary matter, we must determine whet her we have
jurisdiction to review the discovery order.
Macy's argues that we lack jurisdiction because plaintiffs' notice of
appeal does not indicate that they are
appealing the discovery order. In their notice of appeal, plaintiffs
specify only the District Court's order of
August 19, 1998, granting summary judgment for Macy's. See App. at 235a.9
We
_________________________________________________________________
8. Citing Arnold Pontiac-GMC, Inc. v. General Motors Corp., 786 F.2d 564,
568 (3d Cir. 1986), and
Mannington Mills, Inc. v. Congoleum Indus., Inc., 610 F.2d 1059, 1073 (3d
Cir. 1979), plaintiffs also
argue that they were not given sufficient opportunity to conduct discovery
to withstand Macy's motion for
summary judgment and that therefore reversal of the summary judgment order
is required. In response,
Macy's contends that because plaintiffs failed to file a Rule 56(f)
motion, they have not preserved this issue
for appeal. Because we are reversing on the breach of contract claim, we
need not address this issue.

9. The notice of appeal provides, in full: conclude that plaintiffs'
notice of appeal from the District Court's
final judgment is sufficient to support the Court's earlier discovery
order.

Federal Rule of Appellate Procedure 3(c) states that the notice of appeal
must "designate the judgment,
order or part thereof appealed from." Fed. R. App. P. 3(c). However, we
liberally construe the
requirements of Rule 3(c). See Drinkwater v. Union Carbide Corp., 904 F.2d
853, 858 (3d Cir. 1990);
Williams v. Guzzardi, 875 F.2d 46, 49-50 (3d Cir. 1989). Thus, we have
stated:

[W]hen an appellant gives notice that he is appealing from a final order,
failing to refer specifically to earlier
orders disposing of other claims or other parties does not preclude us
from reviewing those orders.

Shea v. Smith, 966 F.2d 127, 129 (3d Cir. 1992) (citing Murray v.
Commercial Union Ins. Co., 782 F.2d
432, 434 (3d Cir. 1986)). And we have explained: "[S]ince . . . only a
final judgment or order is appealable,
the appeal from afinal judgment draws in question all prior non-final
orders and rulings." See Drinkwater,
904 F.2d at 858 (exercising jurisdiction over unspecified order because
finality doctrine barred plaintiff from
appealing that order until after the entry of final judgment) (citing
Elfman Motors, Inc. v. Chrysler Corp., 567
F.2d 1252, 1253 (3d Cir. 1977) (per curiam)); see also Polonski v. Trump
Taj Mahal Assocs., 137 F.3d
139, 144 (3d Cir.), cert. denied, 119 S. Ct. 66 (1998) ("[Liberal]
treatment is particularly appropriate
where the order appealed is discretionary and relates back to the judgment
sought to be reviewed.");
Tabron v. Grace, 6 F.3d
_________________________________________________________________

Notice is hereby given that Joanna Pacitti, a minor, by Joseph Pacitti and
Stella Pacitti, her parents and
guardians, plaintiffs in the above-named case, hereby appeal to the United
States Court of Appeal[s] for the
Third Circuit from an order granting summary judgment in favor of
defendant Macy's and Macy's East and
against plaintiffs which dismissed the action as to defendant Macy's and
Macy's East. The said Order hereby
appealed from was entered in this action on the 19th day of August, 1998.

App. at 235a. 147, 153 n.2 (3d Cir. 1993) ("[W]e construe notices of
appeal liberally as covering
unspecified prior orders if they are related to the specified order that
was appealed from."); Wright, Miller &
Cooper, Federal Practice & Procedure, Jurisdiction 3d § 3949.4 ("[A]
notice of appeal that names the final
judgment is sufficient to support review of all earlier orders that merge
in the final judgment under the general
rule that appeal from a final judgment supports review of all earlier
interlocutory orders.").

We have reviewed orders not specified in the notice of appeal where: (1)
there is a connection between the
specified and unspecified order, (2) the intention to appeal the
unspecified order is apparent, and (3) the
opposing party is not prejudiced and has a full opportunity to brief the
issues. See Polonski, 137 F.3d at
144 (exercising jurisdiction over order granting attorney's fees even
though notice of appeal specified only
the order granting summary judgment); Tabron, 6 F.3d at 153 n.2 (reviewing
order denying request for
counsel even though notice of appeal specified only the order granting
summary judgment).

Review is appropriate here. The discovery order is sufficiently related to
the order granting summary
judgment. The final judgment rule barred plaintiffs from appealing the
discovery order until the District Court
granted Macy's motion for summary judgment. Plaintiffs' notice of appeal
from the final judgment, therefore,
brought up for review the earlier interlocutory discovery order. Cf.
Drinkwater, 904 F.2d at 858; Polonski,
137 F.3d at 144; Tabron, 6 F.3d at 153 n.2; Wright, Miller & Cooper,
Federal Practice & Procedure,
Jurisdiction 3d § 3949.4. Moreover, Macy's had notice of plaintiffs'
intent to appeal the discovery order
since plaintiffs sought review of the entire judgment and argued the
merits of the discovery order in their
opening appellate brief. See Polonski, 137 F.3d at 144 (stating that "the
appellate proceedings clearly
manifest an intent to appeal"); see also Canady v. Crestar Mortgage Corp.,
109 F.3d 969, 974 (4th Cir.
1997) (noting that arguing merits of issue in opening appellate brief puts
appellee on notice as to that issue).
And finally, we discern no prejudice to Macy's. Accordingly, we have
jurisdiction. B. Having found that we
have jurisdiction to revie w this issue, we must next determine whether
the District Court abused its
discretion in limiting discovery to "what promises, if any, were made by
defendant prior to and at the final
audition . . . in New York City that the person selected at that audition
would appear in the role as Annie."
App. at 38a. Plaintiffs contend that the District Court abused its
discretion by unduly limiting discovery to
preclude them from obtaining information relevant to their fraudulent
misrepresentation claims. We review
the District Court's discovery order for abuse of discretion. See Arnold
Pontiac-GMC, Inc. v. General
Motors Corp., 786 F.2d 564, 568 (3d Cir. 1986).

The Federal Rules of Civil Procedure provide, in pertinent part:

Parties may obtain discovery regarding any matter, not privileged, which
is relevant to the subject matter
involved in the pending action, whether it relates to the claim or defense
of the party seeking discovery or to
the claim or defense of any other party. . . . The information sought need
not be admissible at the trial if the
information sought appears reasonably calculated to lead to the discovery
of admissible evidence.

Fed. R. Civ. P. 26(b)(1). It is well recognized that the federal rules
allow broad and liberal discovery. See
In re Madden, 151 F.3d 125, 128 (3d Cir. 1998) ("Pretrial discovery is . .
. `accorded a broad and liberal
treatment.' ") (citing Hickman v. Taylor, 329 U.S. 495, 507 (1947)); see
also Wright, Miller & Marcus,
Federal Practice & Procedure, Civil 2d § 2007 ("The rule does allow broad
scope to discovery and this has
been well recognized by the courts.").

To succeed on a claim for fraudulent misrepresentation under Pennsylvania
law, plaintiffs must establish the
following elements: (1) a misrepresentation, (2) a fraudulent utterance,
(3) an intention to induce action on
the part of the recipient, (4) a justifiable reliance by the recipient
upon the misrepresentation, and (5) damage
to the recipient as a proximate result. See Banks v. Jerome Taylor &
Assocs., 700 A.2d 1329, 1333 (Pa.
Super. Ct. 1997). To prove these elements, plaintiffs must demonstrate
that Macy's fraudulently
misrepresented that the successful participant would perform as "Annie" on
Broadway, that it did so with the
intent to induce participation in the Search, and that Joanna relied to
her detriment upon the
misrepresentation.

Plaintiffs seek production of the following: (1) Macy's communications
with, and relationship to, the
producers regarding the terms of the contract that the producers intended
to offer the successful contestant
and (2) the pecuniary benefit Macy's received as a result of the Search.
See Appellants' Br. at 12, 24. This
information could shed light on Macy's knowledge that it could not offer a
Broadway opening and its
motives for failing to limit the offer accordingly. Thus, we conclude that
the discovery sought here is directly
relevant to the subject matter of this dispute.

We also find it noteworthy that Macy's submitted its contract with the
producers in support of summary
judgment. As previously noted, the federal rules permit discovery of,
among other things, "any matter, not
privileged, which is relevant to the subject matter involved in the
pending action, whether it relates to the
claim or defense of the party seeking discovery or to the claim or defense
of any other party . . . ." Fed. R.
Civ. P. 26(b)(1) (emphasis added).

Macy's asserts that the only relevant representations are "those to which
plaintiffs were . . . privy" and "upon
which plaintiffs could have reasonably relied." Appellee's Br. at 34. This
"what they don't know can't hurt
them" argument is unconvincing. The fact that plaintiffs were not privy to
the information that Macy's
possessed when Joanna relied on its representations and participated in
the Search forms the very basis of
plaintiffs' fraudulent misrepresentation claims.10
_________________________________________________________________

10. Plaintiffs also argue that the District Court erred in limiting the
number of depositions. In light of our
disposition here, the District Court on remand can reconsider whether
additional depositions are necessary
to effectuate plaintiffs' discovery needs with respect to their fraudulent
misrepresentation claims. Only if one
of the factors in Federal Rules of Civil Procedure 26(b)(2) is present
should the Court limit the number of
depositions. See Fed. R. Civ. P. 26(b)(2) (setting forth situations in
which courts may limit the number of
depositions). Accordingly, we conclude that the District Court erred in
limiting discovery.

IV.

For the reasons discussed above, we reverse the grant of summary judgment
on all claims and remand for
further proceedings in accordance with this opinion. We also reverse and
remand for plaintiffs to conduct
discovery consistent with this opinion.

A True Copy: Teste:
Clerk of the United States Court of Appeals for the Third Circuit 20

FOOTNOTES