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Gutkowski v. Steinbrenner Decision

Gutkowski v. Steinbrenner Decision

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Published by: Benjamin Kabak on Jan 28, 2010
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 UNITED STATES DISTRICT COURTSOUTHERN DISTRICT OF NEW YORK
_____________________N
o
09 Civ. 7535 (RJS)_____________________
R
OBERT
M.
 
G
UTKOWSKI
,
Plaintiff,
VERSUS
G
EORGE
S
TEINBRENNER
III,
Defendant.
___________________MEMORANDUM AND ORDERJanuary 26, 2010___________________
R
ICHARD
J.
 
S
ULLIVAN
, District Judge:Plaintiff Robert M. Gutkowski(“Plaintiff” or “Gutkowski”) brings thisdiversity action against Defendant GeorgeSteinbrenner III (“Defendant” or“Steinbrenner”). Plaintiff alleges that afterpresenting Defendant with the idea of creatingwhat ultimately became the YankeesEntertainment and Sports Network (the “YESNetwork” or “YES”), Defendant failed toabide by the terms of an oral agreement underwhich Plaintiff would “have a role in thenetwork as long as it existed, or, otherwise[]be compensated for his efforts andcontributions.” (Compl. ¶ 1.) Plaintiff furtheralleges that Defendant “knowingly lied” toPlaintiff “in order to induce Plaintiff to givehis unique idea.” (
 Id.
) Pursuant to theseallegations, Plaintiff asserts common lawclaims under New York law for breach of contract, unjust enrichment, quantum meruit,and fraud in the inducement.Before the Court is Defendant’s motion todismiss, with prejudice, Plaintiff’s complaintpursuant to Rule 12(b)(6) of the Federal Rulesof Civil Procedure. For the reasons thatfollow, the Court grants Defendant’s motion.
Case 1:09-cv-07535-RJS Document 24 Filed 01/26/2010 Page 1 of 14
 
2I.
 
B
ACKGROUND
A. Facts
1
Plaintiff describes himself as a“distinguished professional in the field of sports television, marketing, and managementwith many years of experience.” (
 Id.
¶ 1.)Defendant is the “owner and the formerprincipal owner and executive” of the NewYork Yankees (“the Yankees”). (
 Id.
¶ 3.)1. The December 1996 Meeting withDefendantPlaintiff first met with Defendant inDecember 1996. (
 Id.
8.) At that time, theYankees had an agreement with the MadisonSquare Garden Network (the “MSGNetwork”), pursuant to which the MSGNetwork possessed the local television andcable rights to Yankees games. (
 Id.
5 &n.1.) The MSG Network, however, had beenpurchased by Cablevision in 1995, “meaningthat Cablevision had, through its ownership of the MSG Network, a 100% ownership of Yankees local television broadcast and cablerights.” (
 Id.
¶ 6.)Plaintiff alleges that, “[a]s an industryinsider, [he] correctly foresaw that this dealwould have serious negative financialconsequences to Steinbrenner and theYankees and their future local televisionrights negotiation.” (
 Id.
8.) At theDecember 1996 meeting, Plaintiff “explainedthe situation” to Defendant and also“presented to Steinbrenner the idea of startinga Yankees owned and operated network as ameans of gaining negotiating leverage overCablevision.” (
 Id.
¶¶ 9, 10.) Defendant was“very intrigued by the idea,” and “asked thatPlaintiff work with the Yankees to figure outthe viability of starting a new network.” (
 Id.
 ¶¶ 10, 11.) Plaintiff alleges that Defendant:told Plaintiff that he would becompensated fairly for his efforts andthat if, in fact, using Gutkowski’sideas, the Yankees did create anetwork, Plaintiff would be the one tobuild it and, afterward, would eitherrun the network or, at a minimum,have a senior management position orbe fairly compensated for his idea andefforts.(
 Id.
¶ 11.)2. The February 1997 Meeting with DavidSussmanIn February 1997, Plaintiff met withDavid Sussman (“Sussman”), general counselof the Yankees. (
 Id.
¶¶ 11, 12.) Plaintiff reiterated his concerns regarding Cablevisionand his idea of creating a Yankees-ownednetwork. (
 Id.
12.) Plaintiff alleges that“Sussman was also very interested in the idea,though he, like Steinbrenner, did not knowhow to go about creating a televisionnetwork.” (
 Id.
)3. The May 1997 Meeting with DefendantPlaintiff met with Defendant a secondtime in May 1997. (
 Id.
¶ 13.) Plaintiff allegesthat, during this meeting, Defendant “wasbecoming more and more interested instarting a Yankees television network.” (
 Id.
)Plaintiff and Defendant, however, “decided tohold off discussing further development of aYankees network until they could get an ideaof the bargaining position Cablevision wouldadopt.” (
 Id.
)
1
Plaintiff’s factual allegations are assumed to be trueand all reasonable inferences are drawn in his favor.
See In re Ades & Berg Group Investors
, 550 F.3d 240,243 n.4 (2d Cir. 2008).
Case 1:09-cv-07535-RJS Document 24 Filed 01/26/2010 Page 2 of 14
 
34. The March 1998 MemorandumIn February 1998, Defendant “called uponGutkowski’s industry expertise and requestedthat he prepare a memo to list and explain allof the local television broadcast and cableoptions available to the Yankees after the year2000.” (
 Id.
¶ 15.) On or about March 5,1998, Plaintiff provided Defendant with amemorandum providing seven “detailedYankees local television broadcast and cableoptions for the future.” (
 Id.
16.) The firstof these options “was the creation of aYankees owned and operated televisionnetwork.” (
 Id.
) “Included with this optionwere thorough five (5) and ten (10) yearbusiness plans laying out network creationand operations including specifics such asproduction, cable and advertiser sales, andmarketing.” (
 Id.
)5. The March 1998 Presentation by TheMarquee GroupOn or about March 10, 1998, Plaintiff andtwo of his partners at The Marquee Groupmade a presentation entitled “The New York Yankees & The Marquee Group:Maximizing Television Revenues” toDefendant and other Yankees executives. (
 Id.
 ¶ 17.) “The presentation explained, in depth,how to build a Yankees television network,”and “Plaintiff, as architect of the network’smodel, covered all the facets of theimplementation and management of theproposed Yankees network.” (
 Id.
)Plaintiff alleges that Defendant “wasimpressed and asked Plaintiff to moveforward on Phase One of Plaintiff’s proposedplan,” which “included developing viablelocal television broadcast and cable options.”(
 Id.
 ¶¶ 18, 19.) For performing this service,“The Marquee Group would charge twenty-five thousand dollars ($25,000) per month fora minimum of six (6) months.” (
 Id.
¶ 19.)“While Steinbrenner never signed theproposal he specifically requested thatPlaintiff proceed under the terms — namelyPhase One of the contract.” (
 Id.
)Defendant, however, “only paid The MarqueeGroup for one month’s worth of compensation — or $25,000 — for its work.”(
 Id.
)Plaintiff alleges that “[a]t the time,Steinbrenner claimed that he was uncertain if he would ultimately choose to create aYankees network, but told Plaintiff that if hedid decide to start a network, Plaintiff wouldbe the one to build it and either run it or besignificantly involved in it.” (
 Id.
) Defendant“also promised that, in any event, Gutkowskiwould be compensated for his idea andefforts,” and “said to Plaintiff and hispartners, ‘You are my guys, if it goes forward,I will do it with you.’” (
 Id.
) “Plaintiff and hispartners [in The Marquee Group] shook Steinbrenner’s hand and departed to beginwork on Phase One.” (
 Id.
) Plaintiff allegesthat based on this agreement and Defendant’spromises, Plaintiff “began laying thegroundwork for the creation of a Yankeesowned and operated television network.” (
 Id.
 ¶ 20.)6. The March 1998 LetterOn or about March 23, 1998, Plaintiff sentDefendant a letter “describing the duties hewas then performing on behalf of a potentialYankees network.” (
 Id.
21.) These dutiesincluded: (1) “analyzing potential strategicand financial media companies as equity and
Case 1:09-cv-07535-RJS Document 24 Filed 01/26/2010 Page 3 of 14

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