An alleged part-owner of a feature film lost his right to bring a lawsuit against a movie studio for the studio’s alleged tortious interference with a business relationship because he waited too long to sue, the Third District Court of Appeal ruled. The case is an informative one for businesses and others involved in commercial disputes, since it highlights the limited bases under which a business can use the legal concept of a “continuing tort” to extend the limitations period for bringing a lawsuit.
In this case, the business relationship regarded an oral contract that governed the ownership of a feature-length film called Shottas. According to Richard Effs, the contract gave him a 25 percent ownership stake in the film. The contract was entered into by Effs and the film’s two writers, Cess Silvera and Keith Dean. In 2005, Sony Corporation of America Pictures stepped in and acquired licensing and distribution rights to the film. In this negotiation, Sony dealt only with Silvera and did not deal with Effs at all. This arrangement led Effs to sue in 2012, claiming that Sony committed tortious interference with a business relationship.
Sony eventually asked the trial court for summary judgment, arguing that Effs waited too long to sue and that his case was barred by the four-year statute of limitations. The trial court agreed, noting that the Sony contract required the studio to make its first payment on Oct. 30, 2005. That date represented the beginning of the limitations period in Effs’ case. Since Effs waited until March 2012 to sue, his case was well outside the limitations period allowed by the law.
Effs appealed, arguing that the misconduct in this case represented what’s called a “continuing tort,” which would have meant a later expiration of the limitations period for suing. Effs based his claim of a continuing tort on the fact that Sony made multiple payments across a period of years in accordance with the licensing agreement it signed.
The appeals court was not persuaded, instead upholding the trial court’s decision against Effs. If the courts had found a continuing tort, Effs might have been able to pursue his case. Florida law says that, in cases of continuing torts, the “cause of action,” or legal basis for bringing a lawsuit, accrues when the impermissible conduct stops. However, the conduct at issue in this case did not represent a continuing tort. Sony’s simple act of making a series of payments, as it promised to do in the licensing agreement, did not make any potentially tortious conduct continual in nature. As other courts had concluded in the past, serial payments like Sony’s were not a series of separate, ongoing improper acts, but instead they were merely the “harmful effects from an original, completed act.” The additional payments may have enhanced the amount damages Effs suffered, but they did not delay the accrual date of his claim.
His claim accrued in 2005. He sued in 2012, making his lawsuit outside the limitations period allowed by law.
There are many decisions you must make if you believe that your business has been harmed by the misconduct of another party. One of these is whether or not to sue. With these and other decisions, it is important to understand the restrictions the law imposes, such as the time limits for bringing suit. For these and other needs, experienced legal counsel can help. The diligent Florida business tort attorneys at Stok Folk + Kon have the knowledge and skill necessary to help you assess your case and decide on a plan to defend your interests.
Contact us online or by calling (305) 935-4440 to schedule your consultation.
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Default Judgment Blocks Arguments About Liability in Florida Contract Dispute Case, Florida Business Lawyers Blog, Nov. 11, 2015