Hill Holliday Connors Cosmopulos, Inc. v. Greenfield, 060211 FED4, 10-1435

Docket Nº:10-1435
Opinion Judge:AGEE, Circuit Judge.
Party Name:HILL HOLLIDAY CONNORS COSMOPULOS, INCORPORATED, d/b/a Erwin-Penland, Plaintiff - Appellee, v. JEFFREY GREENFIELD; 1ST APPROACH LLC, Defendants and Third-Party Plaintiffs - Appellants, v. CELLCO PARTNERSHIP, d/b/a Verizon Wireless; JOSEPH A. ERWIN, Third-Party Defendants - Appellees.
Attorney:Jay Stanley Horowitz, HOROWITZ & FORBES, LLP, Denver, Colorado, for Appellants. Brenda R. Sharton, GOODWIN│PROCTER, Boston, Massachusetts, for Appellees. Phillip Jeffrey North, THE LAW OFFICE OF P. JEFFREY NORTH LLC, Hilton Head Island, South Carolina, for Appellants. Stacey B. Ardini, Kunal Pasr...
Judge Panel:Before GREGORY, AGEE, & KEENAN, Circuit Judges. GREGORY, Circuit Judge, dissenting in part
Case Date:June 02, 2011
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit
 
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HILL HOLLIDAY CONNORS COSMOPULOS, INCORPORATED, d/b/a Erwin-Penland, Plaintiff - Appellee,

v.

JEFFREY GREENFIELD; 1ST APPROACH LLC, Defendants and Third-Party Plaintiffs - Appellants,

v.

CELLCO PARTNERSHIP, d/b/a Verizon Wireless; JOSEPH A. ERWIN, Third-Party Defendants - Appellees.

No. 10-1435

United States Court of Appeals, Fourth Circuit

June 2, 2011

UNPUBLISHED

Argued: March 23, 2011

Corrected Opinion Filed: July 27, 2011

Appeal from the United States District Court for the District of South Carolina, at Greenville. G. Ross Anderson, Jr., Senior District Judge. (6:08-cv-03980-GRA)

ARGUED:

Jay Stanley Horowitz, HOROWITZ & FORBES, LLP, Denver, Colorado, for Appellants.

Brenda R. Sharton, GOODWIN│PROCTER, Boston, Massachusetts, for Appellees.

ON BRIEF:

Phillip Jeffrey North, THE LAW OFFICE OF P. JEFFREY NORTH LLC, Hilton Head Island, South Carolina, for Appellants.

Stacey B. Ardini, Kunal Pasricha, GOODWIN│PROCTER, Boston, Massachusetts, William F. Sheehan, GOODWIN│PROCTER, Washington, D.C., Bernie W. Ellis, Rita M. McKinney, MCNAIR LAW FIRM, P.A., Greenville, South Carolina, for Appellees Hill Holliday Connors Cosmopulos, Incorporated, d/b/a Erwin-Penland, and Joseph A. Erwin; Robert A. Muckenfuss, David M. Chromy, Elizabeth M. Z. Timmermans, McGUIREWOODS LLP, Charlotte, North Carolina, for Appellee Cellco Partnership, d/b/a Verizon Wireless.

Before GREGORY, AGEE, & KEENAN, Circuit Judges.

Affirmed by unpublished opinion. Judge Agee wrote the majority opinion, in which Judge Keenan joined. Judge Gregory wrote an opinion dissenting in part.

Unpublished opinions are not binding precedent in this circuit.

AGEE, Circuit Judge.

Jeffrey Greenfield collaborated with Erwin-Penland, a South Carolina advertising agency, on a marketing plan aimed at securing a contract with the Captain D's restaurant chain. Captain D's declined to implement the proposal, which centered on the general concept of a gospel choir competition entitled "How Sweet the Sound." Erwin-Penland, however, later convinced another client, Verizon Wireless, to fund a modified version of the project, but without the participation of Greenfield or his company, 1st Approach LLC (collectively "Greenfield"). Greenfield subsequently demanded compensation from Erwin-Penland, who responded by filing a declaratory judgment action in South Carolina state court, seeking a ruling that Greenfield had no ownership interest in the "How Sweet the Sound" concept.

Greenfield removed the case to the United States District Court for the District of South Carolina and instituted various counterclaims, including a third-party complaint against Verizon Wireless and Joseph Erwin — the president of Erwin-Penland. The district court concluded that Greenfield had no protected interest in the "How Sweet the Sound" project and granted summary judgment in favor of Erwin-Penland and the third-party defendants.1 Greenfield now challenges that ruling on appeal. For the reasons stated herein, we affirm the judgment of the district court.

I.

Joseph Erwin heard Greenfield speak on the subject of "branded entertainment" at a conference. Subsequently, he asked Greenfield to collaborate with Erwin-Penland on a marketing proposal aimed at securing an account with the Captain D's restaurant chain. Greenfield accepted Erwin's offer without entering into a written agreement establishing the terms of his relationship with Erwin-Penland.

After a series of collaborative phone calls and emails, Greenfield sent Erwin-Penland a marketing deck outlining a concept he labeled "'Amazing Grace' Captain D's Branded Reality Show." Joint Appendix ("J.A.") at 1375. Erwin-Penland subsequently changed the name of the proposal to "How Sweet the Sound." Id. at 712, 896. The "How Sweet the Sound" concept involved "[t]he top 20 church choirs in the U.S. competing for over $250, 000 in prizes and the title of the Best Choir in the USA." Id. at 1376. A production team of producers and cameramen, along with a host "[s]imilar to Ryan Seacrest on American Idol, " would "cross the country in [a] 6 week trek of visiting EVERY Captain D's location, " using local media to publicize the event. Id. at 1377. Once there, the team would interview local choir members about their "choir and why they think they are the best in the US." Id.

Competitions would then take place in Atlanta, Georgia; Jackson, Mississippi; Birmingham, Alabama; and Charleston, South Carolina between the best twenty-five choirs in each region. Each contest would be featured in a television episode, take place "in large arenas, " and "have a large panel of celebrity judges who [would] vote on the best overall performance." Id. The winners of the regional competitions would then "be invited to attend [a] National competition in Nashville, " Tennessee featuring "the 4 best church choirs in the country in an authentic inspirational contest to find the #1 Choir in the USA." Id. Winning the national competition would entitle a choir to "the title of the Best Choir in the USA" and "over $250, 000 in prizes." Id. at 1376.

In conjunction with the "entertainment" provided by the gospel choir competition, Greenfield proposed marketing Captain D's through three different mediums: product placement, radio, and the internet. The parties intended that Greenfield would serve as producer and talent broker for Captain D's "How Sweet the Sound" project. Although Captain D's expressed some interest in the proposal, it ultimately declined to adopt the plan.

Subsequently, Greenfield and Erwin-Penland presented a similar "How Sweet the Sound" concept to Verizon Wireless, one of Erwin-Penland's existing clients. Modifications were made to this proposal to better suit Verizon Wireless' business model. For example, Greenfield and Erwin-Penland suggested signing choirs up for the competition at Verizon Wireless stores and creating "a CD of the winning choirs" that would be distributed "through stores and agents." Id. at 1587.

Although Verizon Wireless also expressed interest in the "How Sweet the Sound" concept, it had concerns about the plan's projected cost. Greenfield and Erwin-Penland subsequently worked to scale back the television component of the project to a one-hour special or documentary. When Verizon Wireless' response to this less-expensive model was not immediately forthcoming, Greenfield inquired as to whether Verizon Wireless was still interested in the concept or whether he was free to present it to other clients. Erwin-Penland responded that Verizon was still considering the scaled-back plan.

Over a year later, Erwin-Penland and Verizon Wireless implemented a limited "How Sweet the Sound" marketing concept by organizing a single gospel choir competition in Memphis, Tennessee. The project later evolved into a series of gospel choir competitions orchestrated throughout the nation. In 2009, the final contest was televised on the Gospel Music Channel and a documentary about the series appeared on the Black Entertainment Television Network ("BET"). Although other agencies aided Erwin-Penland and Verizon Wireless in implementing the "How Sweet the Sound" concept, Greenfield was not asked to assist, and had no part, in executing the plan.

II.

Greenfield demanded compensation from Erwin-Penland for its use of the "How Sweet the Sound" marketing plan, which he claimed to have originated. In response, Erwin-Penland filed a declaratory judgment suit in South Carolina state court, requesting a ruling that Greenfield had "no co-ownership interest or rights in the marketing project 'How Sweet the Sound.'" J.A. at 28. Greenfield removed the case to the United States District Court for the District of South Carolina based on the parties' diverse citizenship. See 28 U.S.C. § 1332(a). He then filed a first amended counterclaim and third-party complaint against Erwin-Penland and the third-party defendants, which stated numerous claims for, inter alia, fraud, breach of contract, misappropriation of trade secrets, and unjust enrichment.

Erwin-Penland and the third-party defendants subsequently filed motions for summary judgment as to all of Greenfield's claims. In turn, Greenfield filed a motion for summary judgment on his unjust enrichment and breach of fiduciary duty claims. The district court concluded that no genuine issue of material fact precluded granting judgment as a matter of law to Erwin-Penland and the third-party defendants. Accordingly, the court granted summary judgment in their favor on all claims and denied Greenfield's competing motion for summary judgment.

First, the district court concluded that "Greenfield's purported trade secrets fail[ed] to meet [the] criterion" for protection under the South Carolina Trade Secrets Act ("the Act"), see S.C. Code Ann. § 39-8-20(5), because his "claimed trade secrets [were] not novel or protectable, and, if they were, Greenfield failed to take reasonable steps to protect them."2 J.A. at 183. Thus, "even assuming the existence of . . . trade secret[s], " id. at 183 n.3, summary judgment was appropriate "for the independent reason that Greenfield failed to take reasonable efforts to protect" them. Id. at 187.

Second, the district court rejected Greenfield's argument that he had "an oral or implied-in-fact contract" with Erwin-Penland that was subject to breach. Id. at 189. Because "[t]he parties did not discuss, let alone come to an agreement on, the essential terms of a contract, " the district court concluded "no reasonable trier of fact could find mutual assent as to any essential terms" of an agreement, given "either orally, in writing, or implied" in fact. Id. at 189.

Indeed, the district court concluded...

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