Gries Sports Enterprises, Inc. v. Modell, No. 84-130

CourtUnited States State Supreme Court of Ohio
Writing for the CourtWISE; FRANK D. CELEBREZZE; WISE, J., of the Fifth Appellate District, sitting for LOCHER; HOLMES; WILLIAM B. BROWN
Citation473 N.E.2d 807,15 Ohio St.3d 284,15 OBR 417
Decision Date31 December 1984
Docket NumberNo. 84-130
Parties, 15 O.B.R. 417 GRIES SPORTS ENTERPRISES, INC. et al., Appellants, v. MODELL, Appellee.

Page 284

15 Ohio St.3d 284
473 N.E.2d 807, 15 O.B.R. 417
GRIES SPORTS ENTERPRISES, INC. et al., Appellants,
v.
MODELL, Appellee.
No. 84-130.
Supreme Court of Ohio.
Dec. 31, 1984.
Syllabus by the Court

In the absence of an effective choice of law by the parties, the contacts to be taken into account to determine the law applicable to an issue include:

(a) the place of contracting,

(b) the place of negotiation of the contract,

(c) the place of performance,

(d) the location of the subject matter of the contract, and

(e) the domicile, residence, nationality, place of incorporation and place of business of the parties.

(Section 188 of 1 Restatement of the Law 2d, Conflict of Laws, adopted and applied.)

Plaintiffs-appellants, Gries Sports Enterprises, Inc. and Robert Gries ("Gries"), brought the instant action against defendant-appellee, Arthur B. Modell ("Modell"), in the Court of Common Pleas of Cuyahoga County seeking specific performance of an agreement between Gries and Modell. The trial court granted the requested relief.

Prior to 1965, Gries were minority shareholders and Modell was the majority shareholder in Cleveland Browns, Inc. ("C.B.I."), a Delaware corporation. In 1965, Modell proposed a corporate reorganization plan that would create a new Delaware corporation named Cleveland Browns Football Company, Inc. ("the Browns"). As proposed, Modell and Gries would exchange their C.B.I. stock for a proportional amount of the Browns stock, and upon completion of such exchange, C.B.I. would be a wholly-owned subsidiary of the Browns.

Gries agreed to the implementation of Modell's proposed corporate organization only upon condition that Modell agreed to certain conditions demanded by Gries. Modell agreed to the conditions and the agreements dated December 8, 1965 (the 1965 agreement), which is the subject of this action, was executed.

The 1965 agreement provided inter alia for:

(1) The holding of regular directors' meetings of both the Browns and C.B.I.;

(2) the election of two directors nominated by Gries;

(3) the establishment, composition, and functioning of an investment committee;

Page 285

(4) the disclosure of Modell to Gries of the commencement of any negotiation to sell any of his shares;

(5) Gries' right to obtain copies of the corporations' financial statements and reasonable access to the books and records of the Browns and C.B.I.;

(6) the prepayment, when possible, by C.B.I. of its outstanding notes; and

(7) the election of Gries designates as vice-president of both the Browns and C.B.I.

The 1965 agreement also provided that the agreement would remain in effect as long as Modell owned at least fifty percent of the common stock of the Browns or C.B.I.

In 1967, Delaware enacted a statute that limited the duration of a voting agreement among stockholders to ten years.

In 1971, Modell proposed a redemption plan whereby a certain portion of the Browns stock would be redeemed in exchange for cash. In order to obtain a federal tax advantage, Modell's holdings after the redemption would fall below fifty percent of the outstanding shares. Gries and Modell executed a document dated June 15, 1971, that reaffirmed the 1965 agreement but altered the duration of the [473 N.E.2d 809] agreement. The 1971 accord provided that the terms of the 1965 agreement would remain in effect as long as Gries and Modell owned, in the aggregate, at least fifty percent of the stock in the Browns or C.B.I. The actual redemption took place shortly after the 1971 document was executed.

On March 16, 1982, Gries demanded that pursuant to the terms of the 1965 agreement as amended, Modell exercise his voting rights to elect two directors nominated by Gries to serve on the board of directors of the Browns and C.B.I. Modell, in refusing to vote his stock to elect the two directors demanded by Gries, stated that he considered the 1965 agreement "as modified by letter agreement dated June 16, 1971, * * * [to be] invalid under Delaware corporation law." Gries thereafter commenced the instant action seeking specific performance of the 1965 agreement.

The cause was submitted to the trial court upon stipulated facts, judgment was entered for Gries, and specific performance was ordered. The trial court ruled that Ohio law, as opposed to Delaware law, controls and that the 1971 agreement was simply an amendment to the 1965 agreement and did not constitute a completely new contract. The court of appeals reversed and remanded, holding that Delaware law applies and that the 1971 agreement constituted an entirely new agreement as of 1971. The cause is now before this court pursuant to the allowance of a motion to certify the record.

Ulmer, Berne, Laronge, Glickman & Curtis and Marvin I. Karp, Cleveland, for appellants.

Jones, Day, Reavis & Pogue, Patrick F. McCartan, Robert C. Weber, Cleveland, and Matthew T. Fitzsimmons, Columbus, for appellee.

Page 286

WISE, Justice.

Gries argue that Ohio law should apply since the 1965 agreement and 1971...

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138 practice notes
  • In re Revco DS, Inc., Bankruptcy No. 588-1305
    • United States
    • United States Bankruptcy Courts. Sixth Circuit. U.S. Bankruptcy Court — Northern District of Ohio
    • July 24, 1990
    ...of Conflict of Laws' position concerning choice of law issues arising in a case involving a contract. Gries Sports Enters. v. Modell, 15 Ohio St.3d 284, 473 N.E.2d 807, 810 (1984), cert. denied, 473 U.S. 906 (1985); Wehrle v. M-J Painting Co., No. 87 C.A. 54 (Ohio Ct.App. May 16, 1988) (198......
  • Taylor v. First Resolution Inv. Corp., No. 2013–0118.
    • United States
    • United States State Supreme Court of Ohio
    • June 16, 2016
    ...to this case and others like it. The appellate court below applied this court's decision in Gries Sports Ents., Inc. v. Modell, 15 Ohio St.3d 284, 473 N.E.2d 807 (1984), and 1 Restatement of the Law 2d, Conflict of Laws, Section 188 (1971), to the conflict-of-laws question in this case. 201......
  • Volkswagen Grp. of Am., Inc. v. Peter J. McNulty Law Firm , Nos. 11–1438
    • United States
    • U.S. Court of Appeals — First Circuit
    • July 27, 2012
    ...629 A.2d 885, 888 (1993) (applying § 188 to contractual choice of law determination). 21.See also Gries Sports Enters., Inc. v. Modell, 15 Ohio St.3d 284, 473 N.E.2d 807, 810 (1984) (applying § 188 to contractual choice of law determination). 22.See also Gillan v. Gillan, 236 Pa.Super. 147,......
  • Wiggins v. Bank of Am., Case No. 2:19-cv-3223
    • United States
    • United States District Courts. 6th Circuit. United States District Courts. 6th Circuit. Southern District of Ohio
    • September 21, 2020
    ...Ltd. v. Midwestern Broad. Co. , 6 Ohio St.3d 436, 453 N.E.2d 683 (1983) (adopting section 187 ); Gries Sports Ent., Inc. v. Modell , 15 Ohio St.3d 284, 473 N.E.2d 807 (1984) (adopting section 188). Thus, this section is inapplicable here. Instead, Sections 145 and 146 of the Restatement app......
  • Request a trial to view additional results
138 cases
  • In re Revco DS, Inc., Bankruptcy No. 588-1305
    • United States
    • United States Bankruptcy Courts. Sixth Circuit. U.S. Bankruptcy Court — Northern District of Ohio
    • July 24, 1990
    ...of Conflict of Laws' position concerning choice of law issues arising in a case involving a contract. Gries Sports Enters. v. Modell, 15 Ohio St.3d 284, 473 N.E.2d 807, 810 (1984), cert. denied, 473 U.S. 906 (1985); Wehrle v. M-J Painting Co., No. 87 C.A. 54 (Ohio Ct.App. May 16, 1988) (198......
  • Taylor v. First Resolution Inv. Corp., No. 2013–0118.
    • United States
    • United States State Supreme Court of Ohio
    • June 16, 2016
    ...to this case and others like it. The appellate court below applied this court's decision in Gries Sports Ents., Inc. v. Modell, 15 Ohio St.3d 284, 473 N.E.2d 807 (1984), and 1 Restatement of the Law 2d, Conflict of Laws, Section 188 (1971), to the conflict-of-laws question in this case. 201......
  • Volkswagen Grp. of Am., Inc. v. Peter J. McNulty Law Firm , Nos. 11–1438
    • United States
    • U.S. Court of Appeals — First Circuit
    • July 27, 2012
    ...629 A.2d 885, 888 (1993) (applying § 188 to contractual choice of law determination). 21.See also Gries Sports Enters., Inc. v. Modell, 15 Ohio St.3d 284, 473 N.E.2d 807, 810 (1984) (applying § 188 to contractual choice of law determination). 22.See also Gillan v. Gillan, 236 Pa.Super. 147,......
  • Wiggins v. Bank of Am., Case No. 2:19-cv-3223
    • United States
    • United States District Courts. 6th Circuit. United States District Courts. 6th Circuit. Southern District of Ohio
    • September 21, 2020
    ...Ltd. v. Midwestern Broad. Co. , 6 Ohio St.3d 436, 453 N.E.2d 683 (1983) (adopting section 187 ); Gries Sports Ent., Inc. v. Modell , 15 Ohio St.3d 284, 473 N.E.2d 807 (1984) (adopting section 188). Thus, this section is inapplicable here. Instead, Sections 145 and 146 of the Restatement app......
  • Request a trial to view additional results

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