KEN F. LEVIN, Plaintiff,
ALEXANDER GRECIAN, Defendant.
MEMORANDUM OPINION AND ORDER
GARY FEINERMAN, District Judge.
Ken Levin, a literary agent, brought this suit in the Circuit Court of Cook County, Illinois, against his former client, author Alex Grecian. Count I of the complaint seeks a declaratory judgment that Levin's and Grecian's representation agreement ("Agreement") is a valid and enforceable contract and that Grecian owes Levin 15 percent of the money that Grecian received for the rights to publish his novel The Yard, a New York Times bestseller, and its forthcoming sequels, the first of which, The Black Country, was released earlier this month; Count II rests on the same factual predicate and seeks damages for anticipatory breach of contract. Doc. 1-2; Doc. 68 at ¶ 114. After removing the suit to this court, Doc. 1, Grecian answered and filed counterclaims, Doc. 8. Count I of the counterclaims alleges that Levin breached the Agreement and seeks damages; Count II alleges that Levin breached fiduciary duties owed to Grecian and seeks damages; Count III seeks a declaratory judgment that Levin's alleged breach of the Agreement terminated Grecian's obligations thereunder, including any obligation to pay Levin a commission; and Count IV seeks, in the alternative to Count III, a declaratory judgment that Levin is entitled at most to only a 5 percent commission as the "co-agent" of Seth Fishman, whose role in the parties' dispute is set forth below. Doc. 8 at pp. 15-17. The parties have agreed to try the case to the bench, with trial set to commence on October 7, 2013. Doc. 49.
Levin has moved for summary judgment on Count I of his complaint and on each of Grecian's counterclaims. Doc. 56. The motion is granted in part and denied in part. Summary judgment is granted to Levin as to Grecian's counterclaims for breach of contract and breach of fiduciary duty. But Levin's declaratory judgment claim and Grecian's declaratory judgment claims (the first of which mirrors Levin's declaratory judgment claim) shall proceed to trial along with the claim in Count II of Levin's complaint.
The following facts are stated as favorably to Grecian, the non-movant, as the record and Local Rule 56.1 allow. See Hanners v. Trent, 674 F.3d 683, 691 (7th Cir. 2012). In considering Levin's motion for summary judgment, the court must assume the truth of those facts, but it does not vouch for them. See Smith v. Bray, 681 F.3d 888, 892 (7th Cir. 2012).
Before proceeding, the court notes that Levin's unauthorized reply to Grecian's Local Rule 56.1(b)(3)(B) response to Levin's Local Rule 56.1(a)(3) statement misunderstands the local rules. Doc. 68 at 1-34. Where Grecian's Local Rule 56.1(b)(3)(B) response denies Levin's Local Rule 56.1(a)(3) assertions of material fact, Grecian includes brief factual statements to support the denials, with citations to relevant portions of the record. Over and over, and citing Miller v. Ameritech Corp., 2005 WL 2266614, at *1 (N.D. Ill. Sept. 14, 2005), Levin complains of these responses with the boilerplate assertion that "Grecian's response... should be deemed an admission and the excess information and argument contained within it should be stricken. The party responding to a 56.1 statement may not include additional facts in its response to the movant's statement of material fact." E.g., Doc. 68 at ¶ 8. Levin badly misreads Miller, which use the phrase "additional facts" in the sense meant by Local Rule 56.1(b)(3)(C), which requires the party opposing summary judgment to submit "a statement... of any additional facts that require the denial of summary judgment." In that context, the phrase "additional facts" does not mean all facts other than the facts asserted by the movant's Local Rule 56.1(a)(3) statement, but rather only those additional facts that are not intended to show that the movant's asserted facts are disputed. Local Rule 56.1(b)(3)(B) provides that the non-moving party should offer factual responses, along with record citations supporting those responses, that controvert the movant's statements of fact, and that the non-movant must limit those factual responses to facts that are indeed responsive to the movant's assertion-that is, to facts that fairly contradict what the movant has actually asserted. If the non-movant wants to assert facts that go beyond what is fairly responsive to the movant's factual assertion, then he must do so not in his Local Rule 56.1(b)(3)(B) response, but in his "statement... of any additional facts that require denial of summary judgment" under Local Rule 56.1(b)(3)(C). See Johnson v. Cnty. of Cook, 2012 WL 2905485, at *12 (N.D. Ill. July 16, 2012) ("It is inappropriate for a non-movant to include additional facts, meaning facts extraneous to the substance of the paragraph to which the non-movant is responding, in a Local Rule 56.1(b)(3)(B) response. Rather, Local Rule 56.1 requires specifically that a litigant seeking to oppose a motion for summary judgment file a response that contains a separate statement under Local Rule 56.1(b)(3)(C) of any additional facts that require the denial of summary judgment.") (first emphasis added, citations and internal quotation marks omitted). The line between a responsive fact that should be included in a Local Rule 56.1(b)(3)(B) response and an extraneous fact that must be stated in a Local Rule 56.1(b)(3)(C) statement is not always bright, and a number of Grecian's responses hover around that line and even cross it. E.g., Doc. 64 at ¶¶ 23, 61. But Levin replies with the boilerplate quoted above even where Grecian's responses do not even approach that line, e.g., Doc. 68 at ¶ 10, indicating that Levin misunderstands the purpose of a Local Rule 56.1(b)(3)(B) response. The court will adhere to the local rules; it will ignore extraneous matter in Grecian's Local Rule 56.1(b)(3)(B) responses, but will take account of facts included in those responses that are relevant to showing that Levin's Local Rule 56.1(a)(3) assertions are genuinely disputed.
Levin and Grecian's relationship began in August 2004, when Grecian sent Levin an email seeking advice about a proposal Grecian expected to receive regarding his work "The Impossible Snowman." Doc. 64 at ¶ 5. The two exchanged several emails and ultimately entered into the Agreement, which has an effective date of November 1, 2004. Id. at ¶¶ 6-7. Levin was impressed by Grecian's work and admits that Grecian was the only client in Levin's 39-year career that Levin took on without a referral. Doc. 68 at ¶ 78. The Agreement made Levin "the sole and exclusive representative of all of the rights to the Properties, " with "Properties" defined to mean the novels, graphic novels, and other comic art works "which are or have been created or controlled by Alex Grecian in whole and in part as of and after the Effective Date [of the Agreement] and all sequels and spin-offs of same." Doc. 58-6 at 2. Levin agreed to "work with [Grecian] to formulate strategies to develop and take out' Properties for print publication, movie, television, and/or video game development." Id. at 2-3. In return, the Agreement provided that Levin "shall have an interest of 15% in any non-comic art writing or print publication (novels, screenplays, etc.), and in third party print publishings of comic art Properties." Id. at 4. The Agreement's initial term was seven years, ending November 2011, and it provides for automatic renewal for additional four-year periods unless Grecian sends a notice of termination to Levin "at least six months before the end of the Term." Id. at 5-6. The Agreement is and was the only contract between Levin and Grecian. Doc. 64 at ¶ 8.
Between October 2004 and December 2011, when Levin and Grecian's relationship came to an end, the two exchanged approximately 781 emails, of which 271 were sent by Levin. Id. at ¶ 11. Around 2007, Grecian authored a series of comic books called Proof; the series was published that same year. Id. at ¶ 12. Levin claimed to have pitched the idea of a television series or movie based on Proof to Sony, the Spike television channel, Whoopi Goldberg, Samuel L. Jackson, and the principals of a development company called Kickstart Entertainment. Id. at ¶ 13. The proposed deal would have paid Levin $45, 000 to $75, 000 per year to act as a "passive producer." Doc. 68 at ¶ 110. Grecian believes that Levin was willing to offer Proof only to potential producers who would pay Levin such a fee, and that this led the producers to reject the proposal. Id. at ¶ 112. No television series ever materialized, and Grecian received no money from Levin's efforts. Id. at ¶ 111. Several times during their relationship, Levin suggested to Grecian that they should co-write something together; Grecian did not accept these proposals, but he admits that he was not harmed by them. Doc. 64 at ¶ 76. Until some six-and-a-half years into the parties' relationship, when The Yard was finished and sold to a publisher in mid-2011, Levin never sold any of Grecian's works. Doc. 68 at ¶ 83. The parties dispute the extent to which the sale of The Yard was attributable to Levin's efforts; the court expresses no view on that point.
In early 2010, Levin and another literary agent, Seth Fishman, agreed to undertake a "joint initiative" to create a graphic novel comprised of several authors' works and to promote it to publishers. Doc. 64 at ¶¶ 15-17, 20-21. Levin introduced Fishman to Grecian's works, and Levin and Fishman decided to pitch Grecian's idea for a graphic novel called The Yard to publishers in New York. Id. at ¶¶ 19, 22-25, 29-32. At Levin and Fishman's meetings with the publishers, Levin took the lead in presenting the material and spoke favorably and enthusiastically about The Yard. Id. at ¶¶ 33-34. After the meetings, Levin came up with the idea that Grecian should write The Yard as a regular prose novel rather than as a graphic novel; Levin and Fishman jointly proposed this to Grecian, who agreed. Id. at ¶¶ 35, 37. As Grecian wrote The Yard, Levin and Fishman provided him with feedback on his drafts, but the parties disagree about how substantive and helpful Levin's feedback was; Grecian testified at deposition, and the court accepts for purposes of this motion, that the feedback was in "the nature or typos and such" rather than addressing plot or style. Id. at ¶ 38.
Levin referred to Fishman as his "co-agent for THE YARD." Doc. 68 at ¶ 85. In October or November 2011, Levin sent Fishman a letter that suggested a split between them of the 15 percent commission for The Yard:
In respect of generated fees [o]f publishing revenues (all manners, formats, media and languages), our agreement is that... you [Fishman] are entitled to Ten (10%) Percent of the gross amount of each "Advance" and under the agreement as and between us, NightSky [Levin's agency] shall receive Five Percent (5%).
Id. at ¶ 87. Levin testified at deposition that had this provision gone into effect between himself and Fishman, Fishman would receive two-thirds of Fishman's typical 15 percent literary agent fee (that is, 10 percent) and Levin would receive one third (5 percent), and that Levin would apply that 5 percent against the 15 percent that Grecian owed him under the Agreement, with the result that Grecian would pay a 25 percent commission: 10 percent to Fishman and 15 percent to Levin. Ibid. Fishman responded later in November, and instead of accepting Levin's proposal, he asked Levin to confirm that Fishman would receive 10 percent of the money paid to Grecian for The Yard and that "the balance" would be divided between Levin and Grecian "as you mutually agree." Ibid. Neither party suggests that Levin responded to this email.
Levin or Fishman submitted an incomplete version of The Yard to an editor at Mulholland Books, an imprint of the publisher Little, Brown. Doc. 64 at ¶¶ 40, 43. Mulholland offered Grecian $10, 000 for the book, and Levin and Fishman advised Grecian to reject the offer because they thought the book was worth much more. Id. at ¶¶ 43-45. Grecian completed the first draft of The Yard in May 2011, and Levin and Fishman sent the draft to thirteen publishers. Id. at ¶¶ 49-50. Fishman conducted an auction, and one of the offers, from Putnam Publishing, was a $500, 000 guaranteed advance for the North American publishing rights to The Yard and one sequel. Id. at ¶¶ 53-55. Levin and Fishman recommended that Grecian accept this offer, and he ultimately did so. Id. at ¶ 56.
In July 2011, Grecian, Levin, and Fishman met in person to discuss the book deal for The Yard and possible deals for other books that Grecian had written or would write in the future. Id. at ¶¶ 61-63. The finalization of the deal for The Yard took several months, and in September 2011 Grecian emailed Levin to express his concern about the delays and to say that he wanted to be paid by the end of the year. Id. at ¶ 67.
Grecian was not always satisfied with his relationship with Levin. In November 2008, Grecian wrote Levin this email with the subject line "What happened to you?":
You said we should expect to hear about the Proof pitch in September, but you haven't returned any of my emails since August. I also get your voice mail when I call and get no return call from you. I haven't received word on any pitch I've sent you.
I'm frustrated. I know you've got clients with bigger careers than mine and I'm just not sure you have time for me. We're past the halfway point on my contract now and nothing seems to have happened with anything.
Doc. 68 at ¶ 80. Also in 2008, Grecian asked Levin to release him from the Agreement because Grecian believed that Levin had lost interest in him and had failed to promote his works adequately. Id. at ¶ 81. Levin refused to release Grecian and said "he would work harder." Ibid. Grecian testified at deposition that, prior to mid-2011, which is when The Yard was finished and sold, "Levin had not done anything directly or concretely to assist me in my career, which was the reason for our relationship." Id. at ¶ 82.
That said, other evidence would permit a reasonable factfinder to conclude that Grecian thought that Levin was a good agent. In February 2010, Grecian wrote this email to a comic book artist:
I don't know if I mentioned this to you, but the only thing I regret in my relationship with Ken (and I'd prefer you keep this between us) is signing a very long contract. My contract's almost up and I plan to stay with Ken, but I also don't need a contract with him after this. I'll work with him on a project-by-project basis.
Doc. 64 at ¶ 28. In December 2010, Grecian sent Levin and Fishman an email saying, "You've both been encouraging and helpful." Id. at ¶ 46. In March 2011, Grecian sent another email to Levin and Fishman saying, "I am grateful beyond words for your faith and interest in my career." Id. at ¶ 48. In May 2011, around the time that Grecian finished the first draft of The Yard, he wrote to Levin, "I think all three of us have good reason to feel pretty damn proud of ourselves right now." Id. at ¶ 51. A few days later, Grecian emailed Fishman, saying, "You and Ken [Levin] did good by me and I have a long memory, " by which Grecian meant that Levin and Fishman "had both been instrumental in agenting for [Grecian], selling the novel." Id. at ¶ 57. In September 2011, Grecian recommended to a writer friend, Jai Nitz, that he hire Levin to represent him. Id. at ¶ 64. And the Acknowledgements page of The Yard says: "I owe many people a profound debt: My agents, Seth Fishman at The Gernert Company and Ken Levin at Night Sky, for talking me into writing this novel in the first place and then championing it beyond the call of duty...." Id. at ¶ 74. At deposition, Grecian explained: "I was by that point referring to Mr. Fishman, but felt it would be impolite since they were a team, to leave Mr. Levin out. That's why I didn't remove him before the book was published." Ibid.
Around October 20, 2011, Levin and Grecian discussed the commissions that Levin and Fishman would be paid from the sale of The Yard. Doc. 68 at ¶ 90. Levin stated his view that he was entitled to a 15 percent commission and that Fishman would receive a further 10 percent, meaning that Grecian would pay a total commission of 25 percent. Ibid. Grecian responded: "You and Seth [Fishman] co-agent for me on my Putnam deal. I'm very grateful to you both, but an agent's fee is generally fifteen percent and I was under the impression that you and Seth would split that fee." Id. at ¶ 91. Grecian noted that Levin's proposal would require him to pay "a whopping twenty-five percent of my earnings... gone before I see a cent, " and said "that's unacceptable." Ibid. Levin responded, "Let me give some thought to your email, as you did, and get back to you, probably tomorrow, " but the record contains no evidence that Levin ever got back to Grecian. Id. at ¶ 92. Fishman told Grecian that "[t]he total commission that comes off your books is per usual, 15%. Anything more than that would be criminal!" Id. at ¶ 97.
On December 21, 2011, Grecian fired Levin. Doc. 64 at ¶ 70. (Although the Agreement's initial term had expired in November 2011, it had automatically renewed for an additional four-year term because Grecian had not sent a notice of termination at least six months prior to the initial term's end. Doc. 58-6 at 5-6.) On the same day, Grecian's attorney sent Levin a letter asserting that Levin had "failed to perform [his] obligations under [the] Agreement." Doc. 64 at ¶¶ 71-72. Grecian took the position that he owed Levin only a 5 percent commission from the sale of The Yard and offered him that much. Doc. 64 at ¶ 73; Doc. 68 at ¶ 93. Around a week later, Levin filed this suit. Doc. 68 at ¶ 93; Doc. 1-2. Fishman has since sold the rights to the third and fourth novels in the series that started with The Yard for a further $500, 000; Levin did not participate in that deal. Doc. 68 at ¶¶ 115-116.
Grecian removed the suit to this court. Doc. 1. The removal was proper under 28 U.S.C. §§ 1441 and 1446 because the case falls within the court's original jurisdiction under § 1332(a) and because Grecian is not a citizen of Illinois, the state in which the action was filed, see § 1441(b)(2). Levin is a citizen of Illinois, Grecian is a citizen of Kansas, and the amount in controversy exceeds § 1332(a)'s $75, 000 threshold because the sales as to which Levin claims a ...