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Oxford Media Group, Inc. v. Family Worship Center Church, Inc.

United States District Court, N.D. Illinois, Eastern Division

August 21, 2019



          Hon. Jorge Alonso United States District Judge.

         After a disagreement, defendant Family Worship Center Church, Inc. (“Family”) pulled its programming from a channel owned by plaintiff Oxford Media Group, Inc. (“Oxford”). Oxford sued for breach of contract, and Family countersued for, among other things, unjust enrichment and fraud in the inducement.[1] Both parties have moved for partial summary judgment. For the reasons set forth below, Oxford's motion for summary judgment is granted in part and denied in part. Family's motion for summary judgment is also granted in part and denied in part.

         I. BACKGROUND

         The following facts are undisputed unless otherwise noted.[2]

         Plaintiff Oxford has a license to broadcast television signals in Chicago under the call letters WJYS. In addition, it operates a digital subchannel, which it calls Prism network. To sell airtime on the Prism channel, Oxford contracted with Bea Sutkus (“Sutkus”), who was paid a 30% commission on the air time she sold. Sutkus was authorized to enter contracts on Oxford's behalf, subject to Oxford's approval. Sutkus was involved in negotiating the contracts between Oxford and Family that are the subject of this case.

         Family is a non-profit religious corporation founded by its leader, Jimmy Swaggart. Family is run by a Board of Trustees, consisting of Swaggart, his wife (Frances Swaggart), his son and his grandson. Family runs both Jimmy Swaggart Ministries, which creates programming, and Sonlife Broadcasting (“Sonlife”), which broadcasts the programming. Sonlife obtains revenue from donations and the sale of products, but it does not sell advertising on its broadcasts. Sonlife's goal is not to make a profit but rather “to spread the Message of the Cross to the world.” In seeking to achieve that goal through broadcasting, Family focused on cost per household.

         It is not clear from the parties' submissions what originally prompted the parties to begin negotiating a contract by which Family would broadcast programming on Oxford's Prism channel. What is clear is that, at some point, Sutkus and David Hamilton (an Oxford employee) traveled to Louisiana to meet with Jimmy and Frances Swaggart and Nikki Tracy (“Tracy”), a Family employee. The meeting was an introductory meeting at which the parties did not discuss terms of a potential contract or Prism's coverage.

         At some point after the meeting, the parties began discussing a potential contract. Sutkus provided Tracy a marketing document that had been prepared by an Oxford employee. The marketing document stated, among other things:

Welcome to Prism
The same signal and coverage as a major television network with the intimacy of a local independent television station A full power multicultural TV station broadcasting from the Willis Tower (formerly Sears Tower) carried over the air on digital and on cable
A rainbow of opportunity with a signal that will make any business or organization find their pot of gold, reaching almost 11 million people in Michigan, Illinois, Wisconsin, and Indiana!
A plethora of multicultural, local, national and international programming specializing in direct response, inspirational and entertainment segments.
Chicagoland's most significant independent station, that can spread anyone's message with 30 to 60 minute spots, with affordable rates that do not discriminate!
Over the Air and Cable Facts
July 2010 Neilsen tracking of Chicago DMA
Prism's signal covers 4.2 million households in America's largest market. That's almost 11 million people!
Prism can be found on:

[Docket 92 at 79].[3]

         On May 16, 2014, Frances Swaggart signed on behalf of Family an agreement with Oxford for airtime on Oxford's Prism network. Sutkus signed on behalf of Oxford, with Oxford's authorization. The contract allowed Sonlife to broadcast its content on Oxford's Prism channel around the clock for twelve months. The contract states, among other things:

d. Right to Modify Terms of Payment. If Agency fails to make timely payment on 29th of the month, Oxford Media Group, Inc. shall have the right to change the terms of payment for further broadcasts under this contract. It is understood by all parties on this contract that Agency's acceptance of the rate stated herein is based solely upon the total number of households to which Oxford Media Group, Inc. will provide distribution, calculated as of the date identified as the “Start Date” on page one of this contract and including but not limited to, all over-the-air households as well as those subscriber households on Comcast Cable in the Chicago DMA including Comcast Chicago (Channel 385 and 687), Comcast Illinois, Comcast Wisconsin, Comcast Northwestern Indiana and Comcast Michigan. The loss of any and/or all of the cable subscriber households shall result in a reduction in Agency's rate by $.42 per household lost.
a. Effect of Termination. If Oxford Media Group, Inc. or Agency/Advertiser terminates this contract, Agency shall be obligated to pay only the rate as specified on the face of the contract up to and including the date of termination.
b. Additional Basis for Termination. Agency/Advertiser shall have the right to terminate this Contract at any time without liability to Oxford Media Group, Inc. if Oxford Media Group, Inc. becomes insolvent, makes an assignment for the benefit of the creditor or files a petition under bankruptcy laws or has such a petition filed against it, if receiver is appointed for Oxford Media Group, Inc.'s property or business, or if Oxford Media Group, Inc. is in material breach of this Contract, provided ...

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