Pacitti v. Macy's

• Citation: 193 F.3d 766
• Decision Date: 15 July 1999
• Docket Number: No. 98-1803,98-1803
• Parties: (3rd Cir. 1999) JOANNA PACITTI, a minor, by JOSEPH PACITTI, and STELLA PACITTI, her parents and guardians, Appellants, v. MACY'S; MACY'S EAST, INC. Argued:
• Court: United States Courts of Appeals. United States Court of Appeals (3rd Circuit)

Page 766

193 F.3d 766 (3rd Cir. 1999)

JOANNA PACITTI, a minor, by JOSEPH PACITTI, and STELLA PACITTI, her parents and guardians, Appellants, v. MACY'S; MACY'S EAST, INC.

No. 98-1803

UNITED STATES COURT OF APPEALS FOR THE THIRD CIRCUIT

Argued: July 15, 1999

Opinion filed September 2, 1999 withdrawn.

Filed October 5, 1999

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) [Copyrighted Material Omitted] Counsel for Appellants: ALFRED W. PUTNAM, JR. (argued) Drinker, Biddle & Reath 1345 Chestnut Street Philadelphia National Bank Building Philadelphia, PA 19107-3496, 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, ROBERT P. JOY (argued) DIANE M. SAUNDERS Morgan, Brown & Joy, LLP One Boston Place, Suite 1616 Boston, MA 02108-4472

Counsel for Appellees: JAMES M. PENNY, JR. Obermayer Rebmann Maxwell & Hippel LLP One Penn Center 19th Floor 1617 John F. Kennedy Boulevard Philadelphia, PA 19103-1895

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

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 129a32a. 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").¹ 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.

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 parent 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 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).

***

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

Id.² Unlike Macy's contract with the producers, neither the official rules³ 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 . . ., 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...