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Electronically FILED by Superior Court of California, County of Los Angeles on 11/05/2019 05:16 PM Sherri R.

Carter, Executive Officer/Clerk of Court, by M. Soto,Deputy Clerk

1 DANIEL M. PETROCELLI (SBN 97802)


dpetrocelli@omm.com
2 TIMOTHY B. HEAFNER (SBN 286286)
theafner@omm.com
3 O’MELVENY & MYERS LLP
1999 Ave. Of The Stars, Seventh Floor
4 Los Angeles, California 90067
Telephone: (310) 553-6700
5
ROBERT N. KLIEGER (SBN 192962)
6 rklieger@hueston.com
RAJAN S. TREHAN (SBN 302242)
7 rtrehan@hueston.com
HUESTON HENNIGAN LLP
8 523 West 6th Street, Suite 400
Los Angeles, California 90014
9 Telephone: (213) 788-4340

10 Attorneys for Defendant and Cross-Complainant


Universal City Studios, LLC
11
SUPERIOR COURT OF THE STATE OF CALIFORNIA
12
COUNTY OF LOS ANGELES, CENTRAL DISTRICT
13

14
FOXCROFT PRODUCTIONS, INC., a Case No. BC683206
15 California corporation; and FAIRMOUNT
PRODUCTIONS, INC., a California Assigned to Hon. Richard J. Burdge, Jr.
16 corporation,
UNIVERSAL’S MOTION FOR (I)
17 Plaintiffs, JUDGMENT NOTWITHSTANDING
THE VERDICT OR,
18 vs.
ALTERNATIVELY, A NEW TRIAL,
19 UNIVERSAL CITY STUDIOS, LLC, a AND (II) TO VACATE AND CORRECT
Delaware limited liability company; and DOES THE JUDGMENT
20 1-20, inclusive,
[DECLARATION OF TIMOTHY B.
21 Defendants. HEAFNER AND [PROPOSED] ORDER
FILED CONCURRENTLY HEREWITH]
22 UNIVERSAL CITY STUDIOS, LLC, a
Delaware limited liability company, Hearing Date: December 2, 2019
23 Time: 8:30 a.m.
Cross-Complainant, Dept: 37
24
vs. Action Filed: November 14, 2017
25 Trial Date: February 21, 2019
FOXCROFT PRODUCTIONS, INC., a RES ID: 313223502072
26 California corporation; and FAIRMOUNT
PRODUCTIONS, INC., a California
27 corporation,

28 Cross-Defendants.

UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT


1 TO ALL PARTIES AND THEIR ATTORNEYS OF RECORD, PLEASE TAKE

2 NOTICE THAT:

3 On December 2, 2019, at 8:30 a.m. or as soon thereafter as the matter may be heard in

4 Department 37 of the above-entitled court, located at 111 N. Hill St., Los Angeles, California,

5 90012, defendant and cross-complainant Universal City Studios, LLC (“Universal”) will and

6 hereby does move the Court to set aside the judgment entered on October 31, 2019 and to enter

7 judgment in favor of Universal notwithstanding the verdict rendered by the jury on March 7, 2019

8 in the above captioned-matter. Alternatively, Universal moves the Court for a new trial.

9 Universal also moves the Court to vacate and correct the judgment entered on October 31, 2019.

10 The Motion for Judgment Notwithstanding the Verdict or, alternatively, New Trial, and

11 Motion to Vacate and Correct the Judgment is and will be brought pursuant to California Code of

12 Civil Procedure §§ 629, 657 et seq., 659, and 663, on the grounds that: (1) the jury’s verdict is

13 unsustainable as a matter of law and lacks substantial evidence to support it; (2) at minimum, a

14 new trial is warranted on the issue of Universal’s contractual right to deduct its distribution fees

15 because the jury’s verdict is contrary to law and there is insufficient evidence to support it; and

16 (3) the judgment is legally erroneous because the 1988 amendment (Exhibit 42) was not based on

17 a mutual “mistake of fact” as a matter of law.

18 As set forth in greater detail in the accompanying memorandum of points and authorities,

19 Universal alleges as follows:

20 1. On March 7, 2019, the jury rendered a verdict that: (1) the parties’ 1971 agreement

21 (Exhibit 10) does not allow Universal to deduct a distribution fee when it acts as a distributor of

22 Columbo; and (2) Plaintiffs did not discover facts before November 14, 2013 that caused them, or

23 would have caused a reasonable person, to suspect that Universal had failed to pay them monies

24 owed or to render accounting statements.

25 2. The Court subsequently held a bench trial and ruled as follows: (1) “[t]he term

26 ‘Photoplays’ as used in Exhibit A to Exhibit 10 is intended to apply to any video recorded

27 program for which Plaintiffs are to receive profit participations under Exhibit 10, which includes

28 individual episodes of Columbo”; and (2) “[t]he second paragraph [of Exhibit 42, the parties’
2
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 1988 agreement] was based on mutual mistake of fact and Plaintiffs are entitled to rescind that

2 agreement.” The Court entered judgment against Universal on October 31, 2019.

3 3. Universal is entitled to judgment notwithstanding the verdict because the jury’s verdict

4 on the distribution fees issue is unsustainable as a matter of law and lacks sufficient evidence to

5 support it—especially in light of the Court’s ruling that “Photoplays” includes Columbo

6 episodes—and because the jury’s verdict on the statute of limitations issue is unsupported by

7 substantial evidence. See CAL. CIV. PROC. CODE §§ 629, 659.

8 4. At minimum, Universal is entitled to a new trial on the distribution fees issue because

9 the jury’s verdict with respect thereto likely rested on a legally erroneous theory, the jury should

10 not have been permitted to interpret the parties’ contract, and the verdict is against the weight of

11 the evidence. See id. § 657.

12 5. Universal is also entitled to an order vacating and correcting the judgment, because the

13 judgment rests on the legally erroneous ruling that the 1988 amendment was based on mutual

14 mistake of fact and that Plaintiffs are entitled to rescission. See id. § 663.

15 This Motion is based on the Notice of Motion and Motion; the attached Memorandum of

16 Points and Authorities in support thereof; the concurrently filed Declaration of Timothy B.

17 Heafner and exhibits attached thereto; the concurrently filed [Proposed] Order; the pleadings and

18 papers on file in this action and the minutes of the Court; and such additional submissions,

19 evidence, and argument, including any reply briefing as may be presented at or before the hearing

20 or that the Court may consider.

21 Dated: November 5, 2019


O’MELVENY & MYERS LLP
22

23 By:
24 DANIEL M. PETROCELLI

25 HUESTON HENNIGAN LLP


Robert N. Klieger
26 Rajan S. Trehan

27 Attorneys for Defendant and Cross-Complainant


Universal City Studios, LLC
28
3
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 TABLE OF CONTENTS

2 Page
I. INTRODUCTION .............................................................................................................. 8
3
II. THE COURT SHOULD GRANT JNOV OR, ALTERNATIVELY, A NEW
4
TRIAL ............................................................................................................................... 10
5
A. JNOV (Or, At Least, A New Trial) Is Required As To The Distribution Fee
Question Because Columbo Episodes Are “Photoplays,” As This Court
6
Correctly Held After The Jury Trial ..................................................................... 11
7
1. The Court’s Post-Trial Ruling That “Photoplays” Includes Episodes
Of Columbo Requires Judgment For Universal On The Distribution
8
Fee Issue Notwithstanding The Jury’s Verdict ......................................... 12
9
2. At Minimum, The Court’s Ruling That Columbo Episodes Are
“Photoplays” Requires A New Trial ......................................................... 15
10
B. The Court Should Grant JNOV On Universal’s Statute Of Limitations
11
Defense.................................................................................................................. 18
12
III. THE COURT SHOULD GRANT UNIVERSAL’S MOTION TO VACATE................. 19
13
A. The Court’s Ruling That The 1988 Amendment Is Invalid Due To Mutual
Mistake Must Be Vacated And Corrected ............................................................ 19
14
IV. CONCLUSION ................................................................................................................. 22
15

16

17

18

19

20

21

22

23

24

25

26

27

28
4
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 TABLE OF AUTHORITIES

2 Page (s)

3 Cases

4 Amin v. Super. Ct. of Orange Cty.,


237 Cal. App. 4th 1392 (2015)..................................................................................................21
5
Appalachian Ins. Co. v. McDonnell Douglas Corp.,
6 214 Cal. App. 3d 1 (1989).........................................................................................................11
7 Bank of the W. v. Super. Ct.,
8 2 Cal. 4th 1254 (1992) ..............................................................................................................10

9 Brown v. City of Sacramento,


37 Cal. App. 5th 587 (2019)......................................................................................................11
10
Brown v. Goldstein,
11 34 Cal. App. 5th 418 (2019)......................................................................................................10
12 Candido v. Huitt,
151 Cal. App. 3d 918 (1984).....................................................................................................17
13

14 Carpiaux v. Peralta Cmty. Coll. Dist.,


215 Cal. App. 3d 1220 (1989)...................................................................................................15
15
City of Hope National Medical Center v. Genentech, Inc.,
16 43 Cal. 4th 375 (2008) ..............................................................................................................17
17 Colaco v. Cavotec SA,
25 Cal. App. 5th 1172 (2018)..............................................................................................11, 14
18
De Guere v. Universal City Studios, Inc.,
19
56 Cal. App. 4th 482 (1997)......................................................................................................16
20
Dowling v. Farmers Ins. Exch.,
21 208 Cal. App. 4th 685 (2012)....................................................................................................21

22 Fidler v. Hollywood Park Operating Co.,


223 Cal. App. 3d 483 (1990).................................................................................................9, 15
23
Fountain Valley Chateau Blanc Homeowner’s Assn v. Super. Ct. of Orange Cty.,
24
67 Cal. App. 4th 743 (1998)......................................................................................................17
25
Hedging Concepts, Inc. v. First Alliance Mortg. Co.,
26 41 Cal. App. 4th 1410 (1996)..............................................................................................20, 21

27 Hess v. Ford Motor Co.,


27 Cal. 4th 516 (2002) ..............................................................................................................11
28
5
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 TABLE OF AUTHORITIES
(continued)
2 Page(s)

3 Home Fed. Savings & Loan Ass’n v. Ramos,


229 Cal. App. 3d 1609 (1991)...................................................................................................16
4
Int’l Engine Parts, Inc. v. Feddersen & Co.,
5 9 Cal. 4th 606 (1995) ................................................................................................................18
6 Jolly v. Eli Lilly & Co.,
44 Cal. 3d 1103 (1988) ...................................................................................................9, 18, 19
7

8 Kasel v. Remington Arms Co.,


24 Cal. App. 3d 711 (1972).......................................................................................................15
9
Knowles v. Super. Ct. of San Diego Cty.,
10 118 Cal. App. 4th 1290 (2004)....................................................................................................8

11 Lundy v. Ford Motor Co.,


87 Cal. App. 4th 472 (2001)............................................................................................9, 15, 16
12
Lyles v. People,
13
153 Cal. App. 4th 281 (2007)....................................................................................................18
14
Manneck v. Lawyers Title Ins. Corp.,
15 28 Cal. App. 4th 1294 (1994)..............................................................................................11, 15

16 In re Marriage of Hahn,
224 Cal. App. 3d 1236 (1990)...................................................................................................21
17
Med. Ops. Mgmt, Inc. v. Nat’l Health Labs.,
18 176 Cal. App. 3d 886 (1986)...............................................................................................16, 17
19
Mosher v. Mayacamas Corp.,
20 215 Cal. App. 3d 1 (1989).........................................................................................................20

21 Neal v. Farmers Ins. Exch.,


21 Cal. 3d 910 (1978) ...............................................................................................................17
22
Newland v. Cty. of L.A.,
23 24 Cal. App. 5th 676 (2018)......................................................................................................10
24
Conservatorship of O’Connor,
25 48 Cal. App. 4th 1076 (1996)....................................................................................................21

26 Oceanside 84, Ltd. v. Fid. Fed. Bank,


56 Cal. App. 4th 1441 (1997)..............................................................................................16, 17
27
Paramount Petroleum Corp. v. Super. Ct.,
28 227 Cal. App. 4th 226 (2014)....................................................................................................20
6
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 TABLE OF AUTHORITIES
(continued)
2 Page(s)

3 Scott v. C.R. Bard, Inc.,


231 Cal. App. 4th 763 (2014)....................................................................................................15
4
Sweatman v. Dep’t of Veterans Affairs,
5 25 Cal. 4th 62 (2001) ................................................................................................................11
6 Wolf v. Walt Disney Pictures & Television,
162 Cal. App. 4th 1107 (2008)............................................................................................16, 17
7

8 Statutes

9 CAL. CIV. CODE § 1577 ...............................................................................................................20

10 CAL. CIV. CODE § 1638 ...............................................................................................................10

11 CAL. CIV. CODE § 1689(b)(1)......................................................................................................20

12 CAL. CIV. PROC. CODE § 337 ....................................................................................................18


13 CAL. CIV. PROC. CODE § 629 ....................................................................................................10
14 CAL. CIV. PROC. CODE § 657 ..............................................................................................10, 11
15
CAL. CIV. PROC. CODE § 663 ....................................................................................................19
16
Other Authorities
17
1 Witkin, Summary 11th Contracts § 257. .....................................................................................21
18
Restatement (Second) of Contracts § 154 cmt. c ............................................................................21
19

20

21

22

23

24

25

26

27

28
7
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 I. INTRODUCTION

2 The principal issue in this motion—and in this entire case—is whether Universal has the

3 right under the parties’ agreement to deduct its distribution fees in calculating net profits when

4 Universal acts as the distributor for episodes of the series Columbo. That issue is definitively

5 resolved by the combination of (i) the “Producer Companies Paragraph” in Exhibit A of the

6 parties’ 1971 Agreement (the “Agreement”), which expressly allows Universal to deduct its

7 “standard” fees for the distribution of “Photoplays,” and (ii) the Court’s ruling that “Photoplays”

8 includes episodes of Columbo. In light of that clear contract language, as construed by this Court,

9 Exhibit A of the Agreement must be read to say that Universal may deduct its standard

10 distribution fees when Universal distributes episodes of Columbo.

11 This plain reading of the Agreement is irreconcilable with the jury’s determination that

12 Universal is not permitted to deduct distribution fees when Universal distributes episodes of

13 Columbo. The reason for the disconnect between the plain language of the Agreement and the

14 jury’s finding is that the jury was asked to decide the question of whether Universal has the right

15 to deduct its distribution fees for Columbo episodes before the Court made its “Photoplay” ruling,

16 so the jury was not instructed that “Photoplays” do include episodes of Columbo.

17 Had the jury been instructed on the proper meaning of “Photoplays,” it would have had no

18 choice but to conclude that Universal does have the right to deduct its distribution fees: There is

19 no dispute that the Agreement gives Universal the right to deduct its distribution fees for

20 “Photoplays”—the Producer Companies Paragraph is unambiguous on this point, and Barry

21 Hirsch, Plaintiffs’ only witness on the distribution fee issue, unequivocally conceded that point at

22 trial. And because the Court found as a matter of law that “Photoplays” includes episodes of

23 Columbo, it necessarily follows that Universal had the right to deduct its distribution fee for those

24 episodes. But because the jury did not know that “Photoplays” includes episodes of Columbo as a

25 matter of law, it evidently (and incorrectly) concluded—accepting an argument that Plaintiffs’

26 counsel made at length during trial—that “Photoplays” does not include episodes of Columbo,

27 and therefore decided the distribution fee issue in Plaintiffs’ favor. For that reason, the jury’s

28 findings cannot stand and judgment notwithstanding that verdict (JNOV) is required.
8
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 In an event, courts considering JNOV motions in contract cases do not defer to jury fact-

2 findings on questions of contract interpretation—review of the interpretation of the contract and

3 the jury’s verdict is de novo—and therefore the Court need not divine what the jury would have

4 done had it been instructed on the meaning of “Photoplays.” Once the point that “Photoplays”

5 includes episodes of Columbo is established, and given the plain contract language and the

6 evidence offered at trial, there is no possible ground to support a verdict precluding Universal

7 from deducting its distribution fees, particularly in light of the de novo standard of review.

8 But even if there were an alternative ground to support the jury’s verdict, at the very least,

9 a new trial would be required because the jury verdict could have rested—and almost certainly

10 did rest—on the legally erroneous theory proffered by Plaintiffs that the term “Photoplays” does

11 not include episodes of Columbo. And “where the jury is permitted to choose between two . . .

12 theories,” one of which is legally erroneous, a new trial is required when “there is no way to

13 eliminate the likelihood that the jury chose the theory affected by [that] error.” Lundy v. Ford

14 Motor Co., 87 Cal. App. 4th 472, 480 (2001); see also Fidler v. Hollywood Park Operating Co.,

15 223 Cal. App. 3d 483, 489 (1990) (holding new trial necessary when jury heard evidence

16 regarding claims that were no longer legally cognizable).

17 JNOV is also warranted on the distinct question of whether Plaintiffs’ contract claims

18 were within the statute of limitations. The jury found they were, but the law applied to the

19 undisputed facts makes clear they are not. The four-year statute of limitations applicable in this

20 case “begins to run when the plaintiff suspects or should suspect . . . that someone has done

21 something wrong to her.” Jolly v. Eli Lilly & Co., 44 Cal. 3d 1103, 1110 (1988). The undisputed

22 evidence at trial showed that Plaintiffs suspected Universal had failed to pay amounts due under

23 the 1971 Agreement more than five years before they filed this suit. All alleged contract breaches

24 occurring more than four years before Plaintiffs sued Universal are therefore time-barred as a

25 matter of law.

26 In addition to JNOV on the distribution fee and statute of limitations issues, Universal

27 also moves to vacate the Court’s own finding that the parties’ 1988 Letter Agreement (the

28 “Amendment”)—which modified the 1971 Agreement—is void due to a mutual mistake of fact.
9
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 The mutual mistake of fact, in the Court’s view, was that in 1988 the parties believed that

2 Columbo’s first cycle was not in a net profits position. But there was no mistake at all—if (as is

3 now clear in light of this Court’s post-trial construction of “Photoplays”) Universal can deduct its

4 distribution fees when calculating net profits, the parties were correct that Columbo was not in a

5 net profits position in 1988. And even if the parties had been wrong about that point, the Court’s

6 mutual mistake ruling must be vacated and corrected because, the “mistake” on which Plaintiffs

7 rely turns entirely on the contested issue of contract interpretation (i.e., whether the 1971

8 Agreement permits Universal to deduct its distribution fees) and thus does not qualify as a

9 “mistake of fact” warranting rescission.

10 For these reasons, the jury verdict and resulting $70.68 million judgment must be set

11 aside, and judgment must be entered for Universal (or, at least, a new trial must be granted).

12 II. THE COURT SHOULD GRANT JNOV OR, ALTERNATIVELY, A NEW TRIAL

13 This motion seeks a judgment for Universal notwithstanding the verdict or, in the

14 alternative, a new trial, see CAL. CIV. PROC. CODE §§ 629, 657, as to two issues: (i) whether

15 Universal was entitled to deduct its distribution fees for episodes of Columbo and (ii) whether

16 Plaintiffs’ claims are time-barred. Generally, a JNOV motion should be granted when “it appears

17 from the evidence, viewed in the light most favorable to the party securing the verdict, that there

18 is no substantial evidence in support.” Newland v. Cnty. of L.A., 24 Cal. App. 5th 676, 684

19 (2018); see CAL. CIV. PROC. CODE § 629. That standard applies to the statute of limitations issue.

20 The same standard, however, does not apply to the distribution fee issue. That issue turns

21 on the construction of the 1971 Agreement, and “interpretation of a contract is a judicial

22 function.” Brown v. Goldstein, 34 Cal. App. 5th 418, 432 (2019). “The language of a contract is

23 to govern its interpretation, if the language is clear and explicit, and does not involve an

24 absurdity.” CAL. CIV. CODE § 1638; see Bank of the W. v. Super. Ct., 2 Cal. 4th 1254, 1264

25 (1992). Even when a contract is ambiguous, there is no role for a jury “[w]hen there is no

26 material conflict in the extrinsic evidence”—in that case, “the trial court interprets the contract as

27 a matter of law.” Brown, 34 Cal. App. 5th at 433. Otherwise said, contract interpretation is

28 “solely a judicial function unless the interpretation turns on the credibility of extrinsic evidence,”
10
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 Appalachian Ins. Co. v. McDonnell Douglas Corp., 214 Cal. App. 3d 1, 11 (1989) (emphasis

2 added), in which case the jury can resolve that credibility issue. Thus, a jury’s interpretation of a

3 contract (as opposed to its resolution of credibility issues) is not subject to the usual substantial

4 evidence standard of review on a JNOV motion, but is instead construed de novo by the trial

5 court, without any deference to the jury’s findings. See Brown v. City of Sacramento, 37 Cal.

6 App. 5th 587, 598 (2019) (“As in the trial court, the standard of review is whether any substantial

7 evidence—contradicted or uncontradicted—supports the jury’s conclusion. However, to the

8 extent a motion for judgment notwithstanding the verdict raises legal issues such as . . . the

9 interpretation of a . . . contract, we review the trial court’s ruling on the motion de novo.”

10 (emphasis added)); Sweatman v. Dep’t of Veterans Affairs, 25 Cal. 4th 62, 68 (2001) (noting that

11 while substantial evidence standard generally applies to JNOV, where there was no conflicting

12 evidence about the interpretation of the parties’ agreement, “[t]he sole question before [the Court

13 was] one of law”); Colaco v. Cavotec SA, 25 Cal. App. 5th 1172, 1183-88 (2018) (trial court

14 erred in denying JNOV motion where there was no extrinsic evidence bearing on contract

15 interpretation); Hess v. Ford Motor Co., 27 Cal. 4th 516, 527 (2002) (affirming directed verdict

16 where extrinsic evidence not in conflict); Manneck v. Lawyers Title Ins. Corp., 28 Cal. App. 4th

17 1294, 1300-01 (1994) (same).

18 A motion for a new trial may be granted based on, inter alia, “[i]nsufficiency of the

19 evidence to justify the verdict or other decision” or an “[e]rror in law, occurring at the trial and

20 excepted to by the party making the application.” CAL. CIV. PROC. CODE § 657.

21 A. JNOV (Or, At Least, A New Trial) Is Required As To The Distribution Fee

22 Question Because Columbo Episodes Are “Photoplays,” As This Court

23 Correctly Held After The Jury Trial

24 For the reasons explained below, the Court’s ruling that “Photoplays” encompasses

25 episodes of Columbo necessarily compels the conclusion that the 1971 Agreement does authorize

26 Universal to deduct distribution fees in connection with its distribution of those episodes. JNOV

27 is thus required. At the very least, the Court should grant a new trial on the distribution fee

28 question.
11
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 1. The Court’s Post-Trial Ruling That “Photoplays” Includes Episodes Of

2 Columbo Requires Judgment For Universal On The Distribution Fee Issue

3 Notwithstanding The Jury’s Verdict.

4 a. The 1971 Agreement between the parties provides Plaintiffs with $135,000 yearly

5 fixed compensation, and at least 10% of “net profits” of any television series they create.

6 Declaration of Timothy Heafner (“Heafner Decl.”), Ex. 1 (1971 Agreement), ¶¶ 1, 6. “[T]he

7 computation of net profits,” the Agreement states, “shall be as per the attached Exhibit A.” Id.

8 The primary question in this case is what net profits (if any) Universal owes Plaintiffs for

9 episodes of Columbo, which turns on how net profits for Columbo are calculated under Exhibit A.

10 The largest driver, by far, of Universal’s liability is whether Universal may deduct its distribution

11 fees from gross receipts when calculating net profits. The conditions under which Universal is

12 permitted to deduct its distribution fees are governed by Exhibit A’s “Producer Companies

13 Paragraph,” under which Universal “may retain” its “standard” distribution fees “without

14 accounting therefore to Participant” when “act[ing] as distributor of the Photoplays.” 1 See id.,

15 Ex. A, ¶ C.

16 Under the plain language of that provision, Universal’s entitlement to deduct distribution

17 fees when it acts as the distributor turns entirely on the meaning of the word “Photoplays” in

18 Exhibit A, and in particular whether that term includes episodes of Columbo. As Barry Hirsch,

19 Plaintiffs’ only witness to address the distribution fee issue, admitted, Universal may deduct

20 distribution fees in connection with Universal’s distribution of “Photoplays.” See Heafner Decl.,

21 Ex. 2 (2/27/19 Tr.) at 101:21-23 (“Q: So it says they can deduct a distribution fee in connection

22 with a, quote, photoplay right? A: That’s correct.”), 105:16-22 (“Q: Is [the Producer Companies

23 Paragraph] where they can take a distribution fee in connection with a photoplay? A: Yes.”). So

24
1
25 The provision provides in full: “Participant [i.e., Plaintiffs] agrees that a Producer Company
[i.e., Universal] may act as a distributor of Photoplays . . . . All fees and charges of each Producer
26 Company shall be distribution expenses or production costs as the case may be, and the Producer
Company may retain its fees and charges as its own property without accounting therefore to
27 Participant. However, such fees and charges shall not exceed those charged by Producer
Company according to then existing standard practices.” Heafner Decl., Ex. 1 (1971 Agreement),
28
Ex. A, ¶ C.
12
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 if “Photoplays” means episodes of Columbo, then the contract unambiguously allows Universal to

2 deduct distribution fees in connection with its distribution of Columbo.

3 It is no surprise, then, that when the distribution fee question was posed to the jury, the

4 principal dispute between the parties was the meaning of “Photoplays.” See, e.g., id., Ex. 3

5 (3/6/19 Tr., Closing Arg.) at 40-55, 64-66, 132-33; see also Pls. 2/15/19 Trial Br. at 13

6 (“Universal contends that the term ‘Photoplays’ refers to ‘episodes’ of the Series, but the overall

7 agreement belies such an interpretation.”); id. at 24-27, 29.

8 The jury apparently believed that “Photoplays” did not include episodes of Columbo,

9 because it concluded that Universal could not deduct fees for its distribution of Columbo. But

10 after the jury delivered its verdict, this Court held that, as a matter of law, the term “Photoplays”

11 means “any video recorded program for which Plaintiffs are to receive profit participations . . . ,

12 which includes individual episodes of Columbo.” Heafner Decl., Ex. 4 (3/13/19 Order) at 3

13 (emphasis added); id., Ex. 5 (3/13/19 Tr.) at 26:6-19 (“I am absolutely convinced that there’s no

14 ambiguity as to what photo plays are in Exhibit A.”). And because, in this Court’s words,

15 “there’s no ambiguity as to what photo plays are in Exhibit A,” id., there is also no ambiguity in

16 the Producer Companies Paragraph. As Mr. Hirsch admitted, the language of that paragraph

17 unambiguously provides that Universal may deduct its standard distribution fees when

18 distributing “Photoplays.” And based on the Court’s construction of “Photoplay”—and

19 particularly in light of the de novo standard of review applicable to contract interpretation

20 questions—the paragraph must be read to say that Universal may deduct its standard distribution

21 fees for Columbo. That inescapable conclusion is irreconcilable with the jury’s verdict, and thus

22 requires judgment notwithstanding that verdict on the distribution fee issues.

23 b. Plaintiffs have also argued that, notwithstanding the plain language of the Producer

24 Companies Paragraph, the parties did not intend for Universal to retain distribution fees because

25 they did not attach a distribution fee schedule to the 1971 Agreement. See Heafner Decl., Ex. 3

26 (3/6/19 Tr., Closing Arg.) at 67; see Pls. 2/15/19 Trial Br. at 29. But that argument makes no

27 sense under the terms of the contract—the Producer Companies Paragraph not only plainly

28 permits Universal to retain its distribution fees for all “Photoplays” (i.e., episodes of Columbo),
13
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 but also makes clear that “such fees and charges shall not exceed those charged by Producer

2 Company according to then existing standard practices.” Heafner Decl. Ex. 1 (1971 Agreement),

3 Ex. A ¶ C. As this Court explained in a February 20, 2019 hearing: “Universal can have its

4 standard fees” and “the agreement left it to Universal to charge the fees no more than the standard

5 amount.” Id., Ex. 6 (2/20/19 Tr.) at 68:9-27; see also id. at 68:24-27 (Court: “As long as they

6 charge no more than the standard amount, they didn’t breach the agreement.”). 2 Had the parties

7 intended the Producer Companies Paragraph to be inoperative unless a distribution fee schedule

8 was attached, the Agreement presumably would have referenced such a schedule. Yet the

9 Agreement contains no such reference, see id. Ex. 1 (1971 Agreement), confirming that the

10 Producer Companies Paragraph means what it says, and allows Universal to deduct its standard

11 distribution fees for “Photoplays,” including episodes of Columbo.

12 The question, then, is not whether Universal can deduct distribution fees under the 1971

13 Agreement—it can under that Agreement’s unambiguous terms—but whether the fees Universal

14 deducted exceeded its standard fees. And on that question, the evidence was clear and entirely

15 undisputed: Plaintiffs (who had the burden of proof) offered no evidence that Universal’s

16 Columbo distribution fees exceeded its standard fees. And Universal presented affirmative

17 evidence that its Columbo distribution fees (as shown in Trial Exhibit 9, see Heafner Decl., Ex. 7

18 (Trial Exhibit 9)) accorded with its “existing standard” fees, see id. Ex. 8 (3/4/19 Tr.) at 69:11-27;

19 83:25-86:2 (former Universal employee Arnold Shane testifying that the percentages in Trial

20 Exhibit 9 were Universal’s standard fees).

21 Thus, this Court’s ruling on “Photoplays” eliminated the sole plausible basis for the jury’s

22 verdict that Universal may not retain its Columbo distribution fees, and therefore JNOV must be

23 granted. See Colaco, 25 Cal. App. 5th at 1187-88 (JNOV required where jury verdict inconsistent

24 2
Plaintiffs also relied on Paragraph 9 of the 1971 agreement, which promises that the parties will
25 engage in future negotiations about Exhibit A’s “net profits” definition, and to make “normal[]”
changes to that definition “to the extent requested.” Heafner Decl., Ex. 1 (1971 Agreement) ¶ 9.
26 But Paragraph 9 expressly confirms that the contract as written “shall constitute the agreement
between the parties,” id., and therefore does not nullify Exhibit A’s terms as the parties agreed to
27 them in 1971. As this Court has already explained, Paragraph 9 is “a different issue . . . that
doesn’t make their standard fees not their standard fees.” Id., Ex. 6 (2/20/19 Tr.) at 68:9-12.
28
There was, moreover, no testimony that Plaintiffs ever asked to renegotiate Exhibit A.
14
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 with contract’s meaning); Manneck, 28 Cal. App. 4th at 1300-02 (directed verdict required where

2 contract terms “are clear and explicit”).

3 ***

4 In light of this Court’s ruling that Columbo episodes are “Photoplays,” the 1971

5 Agreement can admit of only one interpretation: Universal may deduct its standard fees for its

6 distribution of Columbo episodes. The contract is unambiguous on that point. And even if

7 extrinsic evidence could alter that conclusion, Mr. Hirsch’s testimony and all the other extrinsic

8 evidence presented at trial confirms the contract’s unambiguous terms. See, e.g., Heafner Decl.,

9 Ex. 9 (2/28/19 Tr.) at 140:11-141:12 (Ms. McNeely confirming agreement paragraph permits

10 Universal to deduct its distribution fees). Accordingly, this Court should grant JNOV.

11 2. At Minimum, The Court’s Ruling That Columbo Episodes Are

12 “Photoplays” Requires A New Trial.

13 Even if the Court were to disagree with Universal that, as a matter of law, the 1971

14 Agreement permits Universal to retain its standard distribution fees for episodes of Columbo, the

15 Court’s “Photoplays” ruling, at a minimum, requires a new trial for three independent reasons.

16 a. California law is clear that a new trial is required “where the jury is permitted to choose

17 between two . . . theories,” one of which suffers from legal error, “and there is no way to

18 eliminate the likelihood that the jury chose the theory affected by [that] error.” Lundy, 87 Cal.

19 App. 4th at 480; see Scott v. C.R. Bard, Inc., 231 Cal. App. 4th 763, 778 (2014) (“jurors cannot be

20 expected to determine whether a particular theory submitted to them is contrary to law”);

21 Carpiaux v. Peralta Cmty. Coll. Dist., 215 Cal. App. 3d 1220, 1224-25 (1989); Fidler., 223 Cal.

22 App. 3d at 489; Kasel v. Remington Arms Co., 24 Cal. App. 3d 711, 739 (1972). That is exactly

23 what happened here.

24 Plaintiffs offered the jury two theories for why the 1971 Agreement did not allow

25 Universal to retain distribution fees: (i) Columbo episodes are not “Photoplays,” Heafner Decl.,

26 Ex. 3 (3/6/19 Tr., Closing Arg.) at 40-55, 64-66; and (ii) the lack of an attached fee schedule

27 showed that the parties did not intend for Universal to deduct distribution fees, see id. at 33-34,

28 67. But after the Court’s ruling on “Photoplays,” we now know that Plaintiffs’ first theory is
15
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 legally invalid. Even assuming that Plaintiffs’ second theory were valid—which it is not (see

2 supra at 6:23-7:11)—“there is no way to eliminate the likelihood that the jury chose” Plaintiffs’

3 first, legally invalid, theory because the Court did not instruct the jury that “Photoplays” includes

4 Columbo episodes, so the jury could easily have agreed with Plaintiffs that “Photoplays” does not

5 include Columbo episodes. See Lundy, 87 Cal. App. 4th at 480. Indeed, it is almost certain that

6 the jury did rely on that theory because it was Plaintiffs’ primary argument: their summation

7 devoted approximately six times as many transcript pages to their “Photoplays” argument as to

8 their alternative argument. Compare id., Ex. 3 (3/6/19 Tr., Closing Arg.) at 40-55, 64-66, 132-33

9 (“Photoplays”), with id. at 33-34, 67 (fee schedule and Paragraph 9). Accordingly, “[r]eversal”

10 and a new trial “is required.” Lundy, 87 Cal. App. 4th at 480.

11 b. A new trial is required for another reason. In a breach-of-contract case, a jury’s single

12 role is determining “the credibility of conflicting extrinsic evidence.” De Guere v. Universal City

13 Studios, Inc., 56 Cal. App. 4th 482, 506 (1997). “When there is no material conflict in the

14 extrinsic evidence, the trial court interprets the contract as a matter of law.” Wolf v. Walt Disney

15 Pictures & Television, 162 Cal. App. 4th 1107, 1126 (2008). A trial court therefore commits

16 reversible error when it instructs a jury to interpret a contract in the absence of conflicting

17 extrinsic evidence. See, e.g., id. at 1134 (because “[t]here was no ‘conflict’ in the evidence . . .

18 and thus no factual issue for the jury to resolve,” “the interpretation of the meaning of the term . .

19 . was properly a judicial function; and the court erred in submitting this question to the jury”);

20 Oceanside 84, Ltd. v. Fid. Fed. Bank, 56 Cal. App. 4th 1441, 1451 (1997) (holding it is “solely a

21 judicial function to interpret a written instrument unless the interpretation turns upon the

22 credibility of extrinsic evidence”); Home Fed. Savings & Loan Ass’n v. Ramos, 229 Cal. App. 3d

23 1609, 1613 (1991) (“because the parties presented little relevant and no conflicting extrinsic

24 evidence, the trial court properly refused to submit the interpretation of the [contract] to the

25 jury”); Med. Ops. Mgmt, Inc. v. Nat’l Health Labs., 176 Cal. App. 3d 886, 890-92, 895 (1986)

26 (“trial court erred in submitting the issue of the Agreement’s interpretation to the jury” where

27 only inferences to be drawn from evidence, and not evidentiary facts, were in conflict).

28
16
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 As already explained, there was no conflicting extrinsic evidence about the 1971

2 Agreement. See supra, section II.A(1). But even if there were, the Court should only have

3 submitted to the jury questions concerning the conflicting extrinsic evidence. The Court instead

4 submitted to the jury four questions about the meaning of the certain terms in the Agreement, see

5 Heafner Decl., Ex. 10 (3/7/19 Special Verdict Form), despite the absence of any conflicting

6 testimony about the meaning of those terms. That was reversible error, because in the absence of

7 conflicting extrinsic evidence, the Court was obligated to interpret the Agreement as a matter of

8 law. See Wolf, 162 Cal. App. 4th at 1134; Oceanside 84, 56 Cal. App. 4th at 1451; Ramos, 229

9 Cal. App. 3d at 1613; Med. Ops. Mgmt, Inc., 176 Cal. App. 3d at 890-92.3

10 c. Setting all else aside, a new trial is necessary because the evidence weighs heavily

11 against the jury verdict. In ruling on a new trial motion, the trial court effectively sits as a

12 “thirteenth juror,” Neal v. Farmers Ins. Exch., 21 Cal. 3d 910, 933 (1978), and may “disbelieve

13 witnesses, reweigh evidence and draw reasonable inferences contrary to that of the jury,”

14 Fountain Valley Chateau Blanc Homeowner’s Assn v. Super. Ct. of Orange Cty., 67 Cal. App. 4th

15 743, 751 (1998). The court may even grant a new trial where there is “sufficient evidence to

16 sustain the jury’s verdict on appeal, so long as the court determines the weight of the evidence is

17 against the verdict.” Candido v. Huitt, 151 Cal. App. 3d 918, 923 (1984). Because the trial

18 evidence overwhelmingly shows that the 1971 Agreement authorizes Universal to retain its

19 Columbo distribution fees, Universal is, at a minimum, entitled to a new trial.

20

21

22

23 3
Although the Court previously accepted Plaintiffs’ oral argument that City of Hope Nat’l Med.
Ctr. v. Genentech, Inc., 43 Cal. 4th 375 (2008) gives the Court broad discretion to submit issues
24
of contact interpretation to the jury, see Heafner Decl., Ex. 6 (2/20/2019 Tr.) at 78:15-79:8, City
25 of Hope in fact does not support that proposition. City of Hope, like the litany of cases decided
before and since, holds that contract interpretation is “solely a judicial function” except where the
26 contract is ambiguous and the extrinsic evidence is in conflict. 43 Cal. 4th at 395 (emphasis
added). While City of Hope affords the trial court some leeway in deciding the type of verdict to
27 request from the jury when extrinsic evidence is in conflict (i.e., a general verdict versus specific
findings with respect to the conflicting evidence), it provides no basis for a jury determination
28
where, as here, there is no ambiguity in the contract and no conflict in extrinsic evidence.
17
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 B. The Court Should Grant JNOV On Universal’s Statute Of Limitations

2 Defense

3 This Court should also grant JNOV as to the jury’s finding that Plaintiffs’ breach claims

4 were timely. Applying established law to the undisputed facts compels a finding that Plaintiffs’

5 claims are time-barred with respect to any alleged breaches occurring more than four years before

6 Plaintiffs filed suit. See Int’l Engine Parts, Inc. v. Feddersen & Co., 9 Cal. 4th 606, 611 (1995)

7 (when “the relevant facts are not in dispute, the application of the statute of limitations may be

8 decided as a question of law”). Indeed, the Court (i.e., Judge Cunningham) already determined—

9 based on the exact same set of facts—that Plaintiffs’ fraud claims were barred by the statute of

10 limitations and that the discovery rule did not toll Plaintiffs’ claims. Heafner Decl., Ex. 11

11 (12/6/18 Not. of Ruling on Universal’s MSA). The same is true of Plaintiffs’ breach claims.

12 The statute of limitations for a contract-breach claim is four years. C AL. CIV. PROC. CODE

13 § 337. “Under the discovery rule, the statute of limitations begins to run when the plaintiff

14 suspects or should suspect . . . that someone has done something wrong to her.” Jolly, 44 Cal. 3d

15 at 1110. Once a plaintiff has “a suspicion of wrongdoing, and therefore an incentive to sue, she

16 must decide whether to file suit or sit on her rights. So long as a suspicion exists, it is clear that

17 the plaintiff must go find the facts; she cannot wait for the facts to find her.” Id. at 1111; accord

18 Knowles v. Super. Ct. of San Diego Cty., 118 Cal. App. 4th 1290, 1298 n.5 (2004) (“mere

19 suspicion . . . triggers the statute”); Lyles v. People, 153 Cal. App. 4th 281, 286–87 (2007)

20 (“plaintiff discovers the cause of action when he at least suspects a factual basis, as opposed to a

21 legal theory, for its elements, even if he lacks knowledge thereof—when, simply put, he at least

22 suspects that someone has done something wrong to him, ‘wrong’ being used, not in any

23 technical sense, but rather in accordance with a lay understanding”).

24 Here, it is undisputed that Plaintiffs knew that Universal had not paid them any net profits

25 for more than 40 years. So the limitations period would have been triggered when they began to

26 suspect that they should have been paid despite knowing they had not been. And the undisputed

27 facts show that Plaintiffs harbored a longstanding suspicion that Universal had failed to pay them

28 monies allegedly owed under the Agreement many years before they filed their complaint. In
18
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 deposition testimony presented at trial, Foxcroft’s William Link testified that he first suspected

2 that Universal owed him monies as early as 1998. Heafner Decl., Ex. 12 (Link Depo. Tr. 23:7-16

3 (“Q. When -- at some point in time, did you form a suspicion that you were owed monies that

4 weren’t being paid to you? A. Yes. Q. Was that a long time ago? A. Yes. Q. How long ago? A.

5 I don’t remember. Q. Do you think it was at least 20 years ago? A. Maybe.”). Moreover, at least

6 five years before Plaintiffs commenced this action Link and Fairmount’s Christine Levinson

7 specifically discussed suing Universal to collect amounts allegedly due in connection with

8 Columbo. Id., Ex. 13 (Levinson Depo. Tr.) at 22:10-23:9 (testimony introduced at trial); see id.

9 34:14-21 (same). Because Plaintiffs suspected that Universal had wrongfully failed to pay them

10 monies due under the Agreement more than four years before they asserted this action, their

11 claims accrued outside the statute of limitations.

12 It does not matter “that Plaintiffs did not have actual knowledge of a breach of contract or

13 that Columbo was profitable”—as was the case with respect to Plaintiffs’ fraud claim, lack of

14 actual knowledge “is not sufficient to toll the statute of limitations under the discovery rule.” Id.,

15 Ex. 11 (12/6/18 Not. of Ruling on Universal’s MSA); see Jolly, 44 Cal. 3d at 1110-11. As with

16 their fraud claim, “Plaintiffs’ admitted suspicions” that they were owed money under the

17 Agreement sufficed to trigger the limitations period. Id. Any breaches occurring before

18 November 14, 2013 (i.e., more than four years before Plaintiffs sued) are thus time-barred.

19 III. THE COURT SHOULD GRANT UNIVERSAL’S MOTION TO VACATE

20 A motion to vacate and correct a judgment “based upon a decision by the court” rather

21 than the jury should be granted when there is an “[i]ncorrect or erroneous legal basis for the

22 decision, not consistent with or not supported by the facts.” C AL. CIV. PROC. CODE § 663. This

23 Court should vacate its decision that the 1988 Amendment could be rescinded because of mutual

24 mistake.

25 A. The Court’s Ruling That The 1988 Amendment Is Invalid Due To Mutual

26 Mistake Must Be Vacated And Corrected.

27 The Court allowed Plaintiffs to rescind the 1988 Amendment because it agreed with

28 Plaintiffs’ belated contention that the parties made a “mistake of fact”—namely, that Columbo
19
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 was not in a net profits position in 1988. See Heafner Decl., Ex. 5 (3/13/19 Tr.) at 3:20-4:3. As

2 an initial matter, this Court should vacate that decision because there was no mistake at all: if the

3 Court agrees that Universal is permitted to deduct its distribution fees for all the reasons described

4 above, then the parties were correct—not mistaken—that Columbo was not in a net profits

5 position in 1988, see 9/13/19 Supp. Accounting Panel Report, Ex. H (Columbo was in a deficit

6 position in 1988 if distribution fees are deductible), and that proposition is legally erroneous for

7 the reasons explained above. But even setting that aside, this Court should vacate its mutual-

8 mistake decision because, as a matter of law, there is no “mistake” entitling Plaintiffs to rescind.

9 Contracts may be rescinded when the parties give consent because of mutual “mistake.”

10 CAL. CIV. CODE § 1689(b)(1). “The type of ‘mistake’ that will support rescission” is either

11 “mistake of fact” or “mistake of law.” Hedging Concepts, Inc. v. First Alliance Mortg. Co., 41

12 Cal. App. 4th 1410, 1421 (1996). “Mistake of fact” means a “[b]elief in the present existence of a

13 thing material to the contract, which does not exist, or in the past existence of such a thing, which

14 has not existed.” CAL. CIV. CODE § 1577. Plaintiffs did not argue there was any mistake of law.

15 The purported “mistake of fact” on which the Court relied to grant rescission—that

16 Columbo was not in a net profits position in 1998—is not the type of mistake that warrants

17 rescission.4 As just explained, that belief depended entirely on a contested legal question—viz.,

18 whether Universal has a contractual right to retain its distribution fees. If Universal does have

19 that right, then Columbo was not in net profits in 1988; if Universal does not have that right, then

20 Columbo was in net profits in 1988. See 9/13/19 Supp. Accounting Panel Report, Ex. H. Even

21 assuming that Universal was incorrect in its belief in 1988 that it could retain distribution fees, a

22

23 4
Plaintiffs also argued that the parties were under the “mistaken belief” that Columbo “would
never generate a profit.” See Pls. 3/12/19 Br. re Mutual Mistake. The Court properly did not rely
24
on that purported mistake of fact as a basis for granting rescission, see Heafner Decl. Ex. 5
25 (3/13/19 Tr.) at 3:20-4:3, because the parties’ alleged belief that Columbo would never be in net
profits was not a “[b]elief in the present existence of a thing,” C AL. CIV. CODE § 1577 (emphasis
26 added), but rather a prediction about “subsequent events,” Mosher v. Mayacamas Corp., 215 Cal.
App. 3d 1, 4-5 (1989) (“the defense of mistake of fact must be premised on past or present facts,”
27 not “subsequent events”); see Paramount Petroleum Corp. v. Super. Ct., 227 Cal. App. 4th 226,
244-45 (2014) (“Civil Code section 1577 speaks in terms of mistakes as to present or past facts;
28
there is no authority for rescission based on a mistake regarding future events.”).
20
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 party’s “misinterpretation of [a] contract” is not a “mistake of objective existing fact.” Hedging

2 Concepts, 41 Cal. App. 4th at 1421; see Dowling v. Farmers Ins. Exch., 208 Cal. App. 4th 685,

3 699 (2012) (party’s “mistake regarding the proper interpretation of the stipulation” not a “mistake

4 of fact”). Because there is no “mistake” that would entitle Plaintiffs to rescind, the Court’s

5 contrary decision must be vacated and corrected.

6 But even if the 1988 Amendment had arisen from mutual mistake, this Court should not

7 have allowed Plaintiffs to rescind that agreement. Where a party was “aware when he made the

8 contract that his knowledge with respect to the facts to which the mistake relates was limited,”

9 and still “undertook to perform in the face of that awareness, he bears the risk of the mistake.”

10 Restatement (Second) of Contracts § 154 cmt. c; see Amin v. Super. Ct. of Orange Cty., 237 Cal.

11 App. 4th 1392, 1404 (2015) (where party “was willing to go along with the [agreement] knowing

12 she had only limited knowledge of those facts, the law requires her to bear the risk of her

13 mistake”); In re Marriage of Hahn, 224 Cal. App. 3d 1236, 1241 (1990); 1 Witkin, Summary

14 11th Contracts § 257. In Conservatorship of O’Connor, 48 Cal. App. 4th 1076 (1996), for

15 instance, the court held that rescission was improper where a bond issuer “made the decision to

16 issue the Bond without first obtaining and reviewing available information about [a

17 conservator’s] appointment.” Id. at 1098. Because the issuer “treated its limited information as

18 sufficient,” the court explained, it “bore the risk that it was mistaken.” Id. Here, Plaintiffs bore

19 the risk of any mistake about Columbo’s profitability: the evidence is undisputed that Plaintiffs

20 entered the 1988 Amendment knowing that they had limited knowledge of Columbo’s

21 profitability, without “first obtaining and reviewing” information from Universal about

22 Columbo’s gross receipts and costs—for instance, by invoking their contractual right to audit

23 Universal’s books. Id. Indeed, Alan Levine, who negotiated 1988 Amendment on Plaintiffs’

24 behalf, did not even bother to review the 1971 Agreement before negotiating the 1988

25 Amendment. See Heafner Decl., Ex. 9 (2/28/19 Tr.) at 16:7-21, 47:15-48:2 (“Q: You consciously

26 entered into an Amendment without having any idea what the underlying agreement said, correct?

27 A: Yes.”). Had Plaintiffs investigated, they would have known that Universal believed Columbo

28 was in a deficit position because it was deducting distribution fees, and there would have been no
21
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT
1 mistake as to this fact. Having elected to enter into the 1988 Amendment without first even

2 attempting to obtain such information, Plaintiffs cannot now rescind the 1988 Amendment.

3 IV. CONCLUSION

4 In light of this Court’s finding as a matter of law that “Photoplays” in Exhibit A to the

5 parties’ 1971 Agreement includes episodes of Columbo, there is no plausible dispute that the

6 agreement unambiguously authorizes Universal to deduct its standard fees for distribution of

7 episodes of Columbo. This Court should thus grant judgment notwithstanding the jury’s contrary

8 verdict or, at the very least, a new trial on that question. The Court should grant judgment

9 notwithstanding the jury’s statute-of-limitations decision, because the clear law applied to the

10 undisputed facts compels the conclusion that Plaintiffs filed this suit far too late. Finally, the

11 Court should vacate its previous decision that the 1988 Amendment can be rescinded based on

12 mutual mistake because there was no such mistake as a matter of law.

13 Dated: November 5, 2019


14 O’MELVENY & MYERS LLP
DANIEL M. PETROCELLI
15 TIMOTHY B. HEAFNER
16

17 By:
Daniel M. Petrocelli
18
HUESTON HENNIGAN LLP
19 ROBERT N. KLIEGER
RAJAN S. TREHAN
20
Attorneys for Defendant and Cross-
21 Complainant Universal City Studios, LLC
22

23

24

25

26

27

28
22
UNIVERSAL’S MOTION FOR JNOV AND TO VACATE JUDGMENT