Bit Parts

The California Court of Appeal, Second District, ruled that best-selling novelist Clive Cussler didn't breach an implied covenant of good faith and fair dealing when he rejected a series of screenplays developed for a movie based on his novel Sahara. Cussler v. Crusader Entertainment LLC, B208738. The litigation arose out of a $20 million option agreement that allowed Crusader Entertainment to produce films based on several Cussler novels. A Los Angeles Superior Court jury turned down claims that Cussler filed against the production company over his vehement dislike of the Sahara screenplays. The jury also declined Cussler's request to obtain payment from Crusader of remaining installments under the option deal. But the jury awarded Crusader $5 million on an implied covenant claim. California law inserts an implied covenant of good faith and fair dealing into contracts. Affirming all aspects of the case but this latter issue, the Court of Appeals noted in its unpublished opinion: “The implied covenant cannot be imposed on a subject that is completely covered by the contract's express terms.” The court continued: “The bargain struck by Crusader and Cussler did not require Cussler to act reasonably or in good faith in approving screenplays. Rather, the agreement expressly gave Cussler the right to approve screenplays 'in his sole and absolute discretion.' The parties were free to grant Cussler by express terms such discretion even if such discretion would otherwise be forbidden by the implied covenant. ' We cannot rewrite the contract simply because Crusader believes, with hindsight, that using the Approved Screenplay or giving Cussler unfettered discretion to reject other screenplays was not a commercially wise endeavor.”