Booth v. Newport Television, LLC

• Decision Date: 16 December 2011
• Docket Number: 2100413
• Parties: Cyndi Booth v. Newport Television, LLC
• Court: Alabama Court of Civil Appeals

Cyndi Booth

v.Newport Television, LLC

2100413

ALABAMA COURT OF CIVIL APPEALS

OCTOBER TERM, 2011-2012

Dated: December 16, 2011

Notice: This opinion is subject to formal revision before publication in the advance sheets of Southern Reporter. Readers are requested to notify the Reporter of Decisions, Alabama Appellate Courts, 300 Dexter Avenue, Montgomery, Alabama 36104-3741 ((334) 229-0649), of any typographical or other errors, in order that corrections may be made before the opinion is printed in Southern Reporter.

Appeal from Mobile Circuit Court

(CV-08-901716)

PITTMAN, Judge.

Cyndi Booth appeals from a summary judgment entered in favor of Newport Television, LLC ("Newport"), by the Mobile

Circuit Court. We reverse and remand.

In October 2008, Booth sued Newport, seeking a judgment declaring that a confidentiality, trade secrets, and noncompete agreement ("the noncompete agreement") that she had signed while employed by Clear Channel Broadcasting, Inc. ("Clear Channel"), was invalid; Newport had purchased certain assets of Clear Channel, including the television stations that Booth was then working for, and subsequently became Booth's employer. Additionally, Booth asserted a claim against Newport alleging tortious interference with business relations. Newport filed an answer denying Booth's claims and asserted a counterclaim seeking a judgment declaring the validity of the noncompete agreement and Newport's right to enforce the noncompete agreement. Booth denied the claim asserted against her by Newport.

In December 2009, Booth filed a motion for a summary judgment on her claim seeking a declaratory judgment. In January 2010, Newport responded in opposition and attached to its response the affidavit of Hamlet T. Newsom, Jr., a representative of Clear Channel.¹ Booth thereafter filed areply to Newport's response, as well as a motion to strike Newsome's affidavit. Booth filed a supplemental reply in support of her motion for a summary judgment in June 2010.

Newport filed a motion for a summary judgment in October 2010 as to all claims (both Booth's declaratory-judgment claim and her tortious-interference-with-business-relations claim, as well as its claim seeking a declaratory judgment). Booth responded in opposition in November 2010 and filed another motion to strike Newsom's affidavit. Newport thereafter replied to Booth's response in opposition, as to which Booth filed a rebuttal in December 2010.

In January 2011, the trial court heard oral arguments for each summary-judgment motion and Booth's motions to strike Newsom's affidavit. The trial court thereafter denied Booth's motions to strike and entered a summary judgment in Newport's favor as to all claims. Booth timely appealed to the Alabama Supreme Court on January 20, 2011; the supreme court transferred the appeal to this court, pursuant to Ala. Code 1975, § 12-2-7.

The record reveals the following facts. Booth first signed a confidentiality, trade secrets, and noncompeteagreement with Clear Channel in March 2004, and, shortly thereafter, she was hired as a sales associate at a television station owned by Clear Channel.² In November 2006, Booth signed the noncompete agreement at issue.

In April 2007, Newport purchased certain assets of Clear Channel, including WPMI and WJTC, the television stations for which Booth was then working. The terms of the sale were set forth in an asset-purchase agreement ("the purchase agreement") entered into by Clear Channel and Newport. Newport contends that Booth was offered and accepted employment with Newport in April 2007. Newport also contends that, pursuant to the purchase agreement, Booth's noncompete agreements were assigned to Newport.

On September 30, 2008, Booth was offered a job by WKRG, a competitor of WPMI and WJTC ("the competing station"). Booth submitted a written letter of resignation to Newport, in which she did not indicate that she had been offered a job, or thatshe had accepted a job, with the competing station; the record indicates that Booth intended for that letter to be her "two-weeks notice." In a letter dated October 1, 2008 (the day after the date of Booth's resignation letter), Newport's general counsel reminded Booth of the noncompete agreements she had signed in 2004 and in 2006. Booth contends that, at that time, a representative of Newport informed the competing station that it would file a lawsuit against the competing station and Booth if the competing station hired Booth; she alleges that, as a result, the competing station refused to hire her.

The record shows that Booth was employed by Newport until October 17, 2008. Newport contends that the general manager of WPMI and WJTC "urg[ed Booth] to reconsider" before eventually deciding to "accept[ her] resignation" on October 17, 2008, because Booth "would not commit to remaining employed with Newport." Booth, however, asserts that she had told representatives of Newport "that she would not resign her position pending a determination by a court as to the enforceability of the non-compete agreement" but that Newport had, ostensibly, terminated her employment.

The trial court determined as a matter of law that the purchase agreement was ambiguous because, it held, it was unclear whether, pursuant to the terms of the purchase agreement, Booth's employment contract or the noncompete agreement had been assigned to Newport, and, thus, whether Newport could enforce the noncompete agreement.

The relevant portions of the purchase agreement that identified and addressed the purchase of Clear Channel's assets, which included its contracts, are as follows:

"[Article] 1.1. Station Assets. On the terms and subject to the conditions set forth in this agreement, at the Closing (as defined in Section 1.9), Seller [Clear Channel] shall sell, assign, transfer, convey and deliver to Buyer [Newport], and Buyer shall purchase and acquire from Seller, all right, title and interest of Seller in and to the Station Assets. 'Station Assets' means all of the assets, rights and properties used or held for use exclusively on the ownership and operation of the Stations, including each of the following assets and properties of Seller, other than any such asset or property that is described in Section 1.2:

. . . .

"(d) the following contracts, agreements and leases (including employment

agreements, collective bargaining

agreements, real property leases, income-producing leases and agreements for the sale of advertising time on the Stations) to which Seller is party (collectively, the 'Station Contracts') and all rightsthereunder (other than the Retained Party Rights (as defined in Section 1.5): (I) all contracts agreements and leases listed on Schedule 1.1(d) and (ii) all other contracts, agreements and leases that relate exclusively to the operation of the Stations or the ownership of the Station Assets, including without limitation those made between the date hereof and the Closing in accordance with Article 4.... "

. . . .

"[Article] 2.8 Contracts. Schedule 1.1(d) sets forth a true and complete list of all contracts, agreements and leases that relate exclusively to the operation of the Stations or the ownership of the Station Assets (including, without limitation, all contracts for the sale of advertising time, programming and film contracts, syndication contracts, national sales representation contacts, employment contracts, retrotransmission (must carry) contracts, distributions contracts and network affiliation contracts, collective bargaining agreements, Real Property leases, income-producing leases and agreements), other than

"(a) contracts for the sale of time on Stations which are for cash at rate card values consistent with prior practices for the periods in question and with not more than twelve (12) months remaining in their terms or

"(b) contracts which were entered into in the ordinary course of business and (I) which are terminable on thirty (30) days' notice or less without penalty or premium, or (ii) did not impose monetary obligations on Seller in 2006, and are not reasonably expected to impose monetary obligations on Seller in 2007, in excess of [redactedamount] and which impose no material restrictions on the operation of the Stations. The Station Contracts requiring the consent of a third party to assignment are identified with an asterisk on Schedule 1.1(d). Each of the Station Contracts (including without limitation each of the Real Property Leases) is in full force and effect and is binding upon Seller and, to Seller's knowledge, the other parties thereto (subject to bankruptcy, insolvency, reorganization or other similar laws relating to or affecting the enforcement of creditors' rights generally). Seller has performed its obligations under each of the Station Contracts in all material respects and is not in material default thereunder, and to Sellers knowledge, no other party to any of the Station Contracts is in default thereunder in any material respect."

An extensive list of contracts, including specific employment contracts identified by the respective employee's name, was set forth in Schedule 1.1(d) of the purchase agreement; neither Booth's employment contract nor the noncompete agreement was listed. Upon its review of the above-quoted sections of the purchase agreement, the trial court concluded that the purchase agreement was ambiguous. The trial court stated:

"If station contracts assigned are listed on Schedule 1.1(d) as set out by Article 1.1(d) and Article 2.8 warrants that all contracts that relate exclusively to the operation of the stations are listed on Schedule 1.1(d), what purpose or effect isgiven Article 1.1(d)(ii) which provides in the conjunctive that assigned contracts are all contracts that relate exclusively to the operation of the stations?"

Upon determining that the purchase agreement was ambiguous, the trial court permitted Newport to submit parol evidence as to its meaning. At that time, Newport submitted Newsom's affidavit,...