More Borat Litigation

The U. S. District Court for the Southern District of New York has ruled that the plaintiffs who signed releases for use of their images in a “documentary style” film (the infamous Borat movie) and consented to appear in the film cannot now challenge the use of their images.

On a motion to dismiss, the court must accept as true all material facts alleged in the complaint and draw all reasonable inferences in the plaintiff’s favor. See Johnson v. Newburgh Enlarged Sch. Dist., 239 F.3d 246, 250 (2d Cir. 2001). Furthermore, on such a motion, courts may consider “any written instrument attached to [the complaint] as an exhibit or any statements or documents incorporated in it by reference … and documents that the plaintiffs either possessed or knew about and upon which they relied in bringing the suit.”…

Each Agreement at issue in these actions contains an explicit waiver clause that on its face prevents Plaintiffs from bringing the above-captioned actions. To avoid their waivers, Plaintiffs argue that the Agreement—specifically, the term “documentary-style film” as it is used in Paragraph 4 of the Agreement—is ambiguous and cannot be enforced at this stage of the litigation….Further, Plaintiffs argue that the term “documentary-style film” does not describe Borat and, therefore, that they have not waived any right to bring claims against Defendants relating to Borat.

Under New York law, issues of contract interpretation, including determining whether a contract term is ambiguous, are threshold questions of law to be determined by the court and suitable for disposition on a motion to dismiss….A contract term is ambiguous as a matter of law if it is:

capable of more than one meaning when viewed objectively by a reasonably intelligent person who has examined the context of the entire integrated agreement and who is cognizant of the customs, practices, usages and terminology as generally understood in the particular trade or business.

Where there are alternative, reasonable interpretations of a contract term rendering it ambiguous, the issue should be submitted to the trier of fact and is not suitable for disposition on a motion to dismiss…. A court should not find contract language ambiguous, however, on the basis of the interpretation urged by one party where that interpretation would strain the contract language beyond its reasonable and ordinary meaning….Here, the term “documentary-style film” is not ambiguous. Indeed, Psenicska offers a definition of that term that neither Defendants… nor the other Plaintiffs contest….

For these reasons, I conclude that the Agreement is not ambiguous and may be enforced at this stage of the litigation.

…

Nevertheless, each Plaintiff seeks to avoid the waiver clause in the Agreement by arguing that he or she was fraudulently induced to enter the Agreement. Specifically, each Plaintiff argues that Schulman’s representations about the nature of the film and the identities of Schulman, Cohen and Springland Films were false and were meant to induce him or her to appear in the film….

That line of argument is foreclosed to Plaintiffs here, however, because each waived his or her reliance on “any promises or statements made by anyone about the nature of the Film or the identity of any other Participants or persons involved in the Film.”

…

In the alternative, each Plaintiff argues that Defendants had a duty to disclose the nature of the film and the identities of those involved in the film…. Each Plaintiff invokes the duty to disclose that arises when a “party possesses superior knowledge, not readily available to the other, and knows that the other is acting on the basis of mistaken knowledge,”… and the principle that “an express disclaimer will not be given effect where the facts are peculiarly within the knowledge of the party invoking it,” ….These Plaintiffs cannot avoid the consequences of their waivers, however, simply by restyling their allegations of misrepresentation as allegations of omission….Such would empower these Plaintiffs to avoid the clear wording of their own contracts in a manner I must decline to condone under well-settled New York law. In light of the above disposition, I do not reach Defendants’ additional arguments….For the reasons stated above, the Agreements in each of the above-captioned actions is unambiguous and, based on the language of those Agreements, these Plaintiffs may not now maintain a defense of fraud in the inducement. The Agreements are thus enforceable, and the provisions contained therein waiving Plaintiffs’ respective rights to bring any and all claims against Defendants with respect to Borat prevent the instant actions.

The case is Psenicska v. Twentieth Century Fox, 36 Med.L.Rptr. 2281 (U.S.D.C., S.D.N.Y., 2008).