A federal judge from the Northern District of Texas has found that a sports agency, which alleged that another agency effectively stole its client, has survived several motions to dismiss filed by the defendants.
In 2006, plaintiff Hambric Sports Management entered into a management and representation agreement with Anthony Kim, a professional golfer. The agreement provided that Hambric would represent Kim as his agent from August 24, 2006, to December 31, 2008, and that Hambric would be entitled to receive commissions for merchandising, endorsing, promoting, and marketing deals through the end of the contract.
Shortly after the agreement went into effect, Hambric began marketing Kim, securing lucrative endorsements with sponsors such as Nike. On May 6, 2008, however Kim sent correspondence to Hambric notifying it that he was immediately terminating the agreement. On June 10, 2008, Kim signed a new agency agreement with IMG Worldwide, Inc. Because Hambric believed it had the exclusive right to represent Kim through December 31, 2008, the agency sued IMG and other agencies — Gaylord Sports Management, LLC and Team AK, Inc., arguing that Kim the defendants wrongfully violated the agreement.
Hambric also alleged that agent Sterling C. Ball delivered copies of the agreement and Kim’s endorsement contract with Nike to Gaylord for review. Ball and Gaylord allegedly “discussed at length with each other the prospect of Gaylord representing Kim over the course of at least 30 phone conversations. Gaylord then allegedly conversed with many endorsement companies concerning a prospective business relationship once it had secured representation of Kim; Hambric asserts that such actions hindered its ability to market and secure additional endorsement deals for Kim.”
Several motions to dismiss were filed by the defendants. Most notable was Gaylord’s motion to dismiss, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, or the failure to plead “enough facts to state a claim to relief that is plausible on its face.”
The court sided, in part, with the plaintiff.
“The pleadings … provide a reasonable basis from which to draw the inference that [the defendants] knew, or at least [were]aware of, Kim’s exclusive contractual relationship with Hambric. Despite such knowledge, the plaintiff alleges that [the defendants] continued to engage in talks … and ‘felt out’ the market for new potential endorsement contracts. The court determines that this alleged conduct constitutes intentional and willful acts of interference.”
Where the plaintiff fell short was in proving “proximate causation.”
“With respect to proximate causation, Gaylord contends that the plaintiff has failed to allege any harm resulting from Gaylord’s conduct. Gaylord further asserts that there is no causal relationship between Gaylord’s purported interference and Hambric’s resulting damages because Kim ultimately entered into a new agreement with IMG, not Gaylord. Gaylord therefore maintains that any injury that Hambric suffered could not have been caused by Gaylord. Hambric responds that Gaylord played an active role in persuading Kim to terminate the agreement because Gaylord participated in over 30 phone calls with [IMG agent Sterling] Ball to discuss Gaylord replacing Hambric as Kim’s agent, prior to the Agreement’s termination.
“Hambric’s pleadings paint Ball as the driving force and catalyst behind Kim’s moves to terminate the agreement and acquire a new agent. There is nothing that suggests Gaylord ever made an offer to Kim of ‘better terms or other incentives’ prior to the agreement’s termination. That the pleadings state that Kim ultimately signed with IMG instead of Gaylord is also telling. It is difficult for the court to conclude that Kim was coaxed into terminating the agreement due to Gaylord’s talks with Ball when it was IMG, not Gaylord, that entered into a new agency agreement with Kim. Moreover, there is no indication that Gaylord was ever in direct contact with Kim. The pleadings repeatedly limit Gaylord’s contact with Kim to its interactions with Ball. It was Ball who sought out Gaylord and allegedly acted as Kim’s representative; it was not the other way around. The court therefore determines that Hambric has not established proximate cause, a critical and required element for bringing its claim for tortious interference with existing contract. Accordingly, Hambric’s claim should be dismissed for failure to state a claim upon which relief can be granted.”
However, the court was not unsympathetic to Hambric, allowing the plaintiff to cure any deficiencies in its complaint that were identified by the court. “This lawsuit was originally filed in state court and was originally subject to less stringent pleading standards,” it wrote. “The plaintiff has not yet had an opportunity to address the deficiencies identified by the court so as to comport with the heightened federal pleading standard.”
Hambric Sports Management, LLC v. Team AK, INC., IMG Worldwide, INC., GAYLORD Sports Management, LLC, and Sterling C. Ball; N.D.TX; Civil Action No. 3:09-CV-1662-L, 2010 U.S. Dist. LEXIS 65491; 6/29/10
Attorneys of Record: (for Hambric Sports Management, LLC, Plaintiff) Mark A Goodman, LEAD ATTORNEY, Robert J Palmer, David Goodman & Madole, Dallas, TX. (for Team AK, Inc, Defendant) Alan S Leibel, LEAD ATTORNEY, Jeffrey R Sandberg, Palmer & Manuel LLP, Dallas, TX; David F Aggers, Aggers & Joseph Co LPA, Cleveland, OH. (for Gaylord Sports Management, LLC, Defendant) Brian A Colao, LEAD ATTORNEY, Dykema Gossett PLLC, Dallas, TX. (For Sterling C Ball, Defendant) Charles J Blanchard, LEAD ATTORNEY, Carrington Coleman Sloman & Blumenthal, Dallas, TX. (for IMG Worldwide, Inc., Defendant) Doug K Butler, LEAD ATTORNEY, Joshua J Iacuone, Figari & Davenport, Dallas, TX.
