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Speakers of Sport, Inc. v. ProServe, Inc.

Speakers of Sport, Inc. v. ProServe, Inc.

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Published by Reid Murtaugh

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Published by: Reid Murtaugh on Jan 23, 2009
Copyright:Attribution Non-commercial

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02/28/2013

 
Speakers of Sport, Inc. v. ProServe, Inc
Seventh Circuit Court of Appeals178 F.3d 862 (7th Cir. 1999)
Key Search Terms: puffing, tort of Interference with BusinessRelationships, fraud, deceptive practices, unfair competitionFacts
Speakers of Sport (Speakers), the plaintiff, signed Ivan Rodriguez in 1991 to aterminable at will contract making Speakers his agent. ProServ, a competingsports agency, promised Rodriquez that they would find him endorsementcontracts worth two (2) to four (4) million dollars if he decided to terminate hiscontract with Speakers and sign with ProServ. Rodriquez signed with ProServand did not receive any significant endorsement contracts. Speakers filed suitclaiming that ProServ fraudulently interfered with Rodriguez’s contract withSpeakers.
Issue
Did ProServ tortiously interfered with a business relationship when it promisedendorsement money to a competitors’ client? And, did ProServ’s actions violatethe Consumer Fraud and Deceptive Business Practices Act?
Holding
 The court ruled that sports agents should be allowed to try to take client fromcompetitors without incurring liability. The court reasoned that competition isnot a tort, instead it provides a defense to the tort of improper interference. The court reasoned that sports agents do not “own” clients who are signed to acontract that is terminable at will. The court viewed ProServ’s promise toRodriquez as puffing, which the court defined as “pure fantasyand grossexaggeration.” The court reasoned that the only reasonable meaning to attachto ProServ’s promise was that ProServ would make its best effort to findRodriguez the highest amount of endorsement money as possible. The courtheld that ProServ’s promise could not be the basis for fraud there was noevidence of a scheme to defraud. Therefore, the court concluded that Speakersclaim for tortious interference with a business relationship failed. As to thesecond issue, competitors, who bring suit under the Consumer Fraud andDeceptive Business Practices Act, must produce clear and convincing evidencethat the alleged conduct created consumer protection concerns. The courtreasoned that Rodriquez was the only consumer involved in Speakers’ allegations, and he did not claim that he had been harmed in any way. Thecourt held that ProServ’s did not engage in an unfair method of competition. The court supported this conclusion by citing a provision of the Federal TradeCommission Act, stating the Act is designed to protect consumers fromdeceptive practices but not to protect competitors from competition.

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