Summary
This Idaho Supreme Court opinion addresses a dispute involving alleged breaches of oral and written contracts, as well as fraud claims arising from negotiations over a proposed cinema project. The court affirmed the trial court's grant of summary judgment on the unenforceable oral contract and fraud claims but reversed the dismissal of the written contract claim against one defendant due to genuine issues of material fact regarding unauthorized disclosure of proprietary information. Additionally, the court upheld the award of attorney fees under Idaho Code section 12-120(3) for prevailing parties in the commercial transaction, while remanding the fee award against the remaining defendant for further proceedings.
Topics
Practice areas
Questions Presented
- Whether the alleged oral covenant not to compete is enforceable.
- Whether the fraud claim based on representations of future events is actionable.
- Whether a genuine issue of material fact exists concerning breach of the written contract embodied in the August 17, 1989 letter.
- Whether the award of attorney fees under I.C. §12‑120(3) is proper.
Holdings
- The oral contract is unenforceable because the covenant lacks a reasonable duration and therefore is unreasonable.
- The fraud claim is dismissed because the alleged representations concerned future events and the plaintiff failed to show the defendants intended not to perform.
- A genuine issue of material fact exists; the summary judgment dismissing the written‑contract claim against Dolsot is vacated and the claim is remanded for further proceedings.
- The award of attorney fees to the prevailing parties (except Dolsot) is proper; the award to Dolsot is to be determined on remand.
Key quotations
“In effect, the alleged oral contract was a covenant not to compete, that is, an agreement not to allow some theater operator other than Magic Lantern to participate in the project.” (at 481)
Factual background
Magic Lantern operated a movie theater in Ketchum, Idaho. Cinema Plaza Partners (CPP) negotiated with Magic Lantern to participate in a mini‑mall and cinema project. Magic Lantern provided proprietary information via a letter dated August 17, 1989, which Dolsot signed agreeing to keep the information confidential. CPP later abandoned the project, sold its interest, and Dolsot and Block 56 used the information in developing the project, leading Magic Lantern to sue for breach of oral and written contracts and fraud.
Procedural history
The trial court granted summary judgment dismissing Magic Lantern's breach of contract and fraud claims and awarded attorney fees to defendants. The Idaho Court of Appeals affirmed. The Supreme Court of Idaho granted review.
Remand instructions
Remand the written‑contract claim to the trial court for further proceedings.