Jim Belushi: Sticking Up for a Name and a Brand

jim_belushi_photo6Lately, comedian/actor Jim Belushi seems to be spending quite a bit of time in court trying to protect a prized asset: his name and its brand. In show business, there can be plenty to a name, especially if money is riding on it. Obviously, this knowledge isn’t lost on Belushi as he makes his adventures in the courtroom with a double-barreled lawsuit.  But first here’s the story:

As it happens, Belushi owns the “Belushi Comedy Bar” trademark which he licenses to stand-up comedy clubs in exchange for royalty payments. In one lawsuit [filed in Chicago on June 5, 2015] Belushi claims that in the fall of 2014, he and his company Bessie Blu entered into an agreement with Kyle Lane, co-owner of Chicago club “The Comedy Bar”, which would allow the comedy club to use the Belushi Comedy Bar trademark in its business operations. As part of the overall agreement, which was in draft form only, Belushi’s company Bessie Blu laid out close to $17,000 in November 2014 for the installation of new lighting on the stage of the club’s new location. The trademark deal itself, however, fell through in January 2015. In the same fall 2014, Belushi claims that he and Bessie Blu made a loan to Kyle Lane to help the business operations of the club on the understanding that the loan will be repaid “in a timely fashion.” Following the January 2015 collapse of their trademark deal, Belushi alleges that Lane has failed to repay the loan and has refused to sign a document that would “memorialize” any oral agreement they had related to the payments.

The third leg of this lawsuit was Belushi’s claim that he was owed about $39,000 for some promotional work he did on behalf of the Comedy Bar between 2012 and 2013 − following an oral agreement he made with Lane. Belushi’s alleged promotional work included TV appearances, radio and newspaper interviews and visits to high-end hotels in the Chicago area. The bill for the promotional work includes lodging and travel expenses allegedly incurred by Belushi who lives in Los Angeles. In this lawsuit, Belushi seeks reliefs in damages for breach of contract and unjust enrichment.

The other lawsuit filed one day earlier [June 4, 2015] against Sahar Chavoshi, the club’s general manager, was based on the events that occurred after January 2015, as stated above.  According the Belushi’s lawsuit, Chavoshi maligned or bad-mouthed him to other comedians, leading to the cancellation of some shows at his other clubs. Belushi claims more than $50,000 in his defamation lawsuit against her, plus punitive damages.

At the outset, one thing that catches the eye here is the way that Belushi filed two separate cases against Lane and Chavoshi revolving around the same failed trademark deal. Though he has the right to do so, this is sort of an unusual move in these situations. For starters, it probably would be less expensive to do it all in one shot by way of a single lawsuit. Plus, if he was looking to get this stuff all behind him as soon as he can, then clearly, pursuing two separate lawsuits, a tactic that may well land him in two separate courtrooms, isn’t the best way to achieve that goal. Given all this, it just might be better for him to consider consolidating the two cases together in order to fight his battle in a single lawsuit. (It is difficult to see what tactical advantages he could reap by continuing to pursue the two lawsuits separately.) The other thing about the lawsuits is that we’re dealing with mostly oral agreements with respect to the claims he is making. Even in the one situation involving the trademark deal for the Belushi name, where something was allegedly written down, the document remained just a ‘draft’ that never evolved into an actual valid agreement. So, as a practical matter, the disputes arising from that agreement will be resolved in the same way that disputes are resolved in oral or unwritten agreements generally.

Now, that said, how will Belushi fare in his two lawsuits? Can he win?

Let’s begin with the unjust enrichment claims. This relief is usually granted as an “equitable remedy.” In lay person’s language, this legal jargon simply means that the court is acting in the interest of “fairness” in order to prevent one person from hanging on to ill-gotten gains at the expense of somebody else who had dealt with them in good faith and who, to the knowledge of both of them, was expecting to get paid for their services. As an equitable remedy, it is often granted to somebody when the better option of a “legal remedy” isn’t available.  Compared to an equitable remedy, a legal remedy in a contract situation presents more of a black-and-white scenario: for instance, two people have a deal, “signed sealed and delivered” where one person promises to paint a house in exchange for the other person promising to pay him $100.  If the first person does paint the house and the other person fails to give him $100, then the law steps in and enforces the agreements. This is a legal remedy situation where the lines of obligation are clear and the court knows exactly what obligations it is called upon to enforce.

However, if the agreement isn’t written down anywhere, it means that we can’t see where one party had promised to paint a house in exchange for the other party paying him $100. Yet, in these situations, the party who has painted the house, for instance, is asking the court to make the other party hand him the $100. This is an equitable remedy situation and the only reason for the court to intervene here is to promote “fairness”: If the court fails to intervene here, then the party who doesn’t have to keep his promise will have been “unjustly enriched” at the expense of the party who took the trouble to keep his own promise. Yet, fairness or not, the court cannot intervene unless it is shown the evidence that one party had indeed promised to paint the house in return for the other party paying him $100 and also that the first party had gone ahead to actually paint the house as promised. Obviously, this is a more difficult situation because there is no valid written agreement in existence. In the real world out there, an agreement that is oral in nature rather than written falls into this category where only an equitable remedy is available to prevent unjust enrichment. Like Belushi’s agreement here.

Speaking of Belushi’s case, one can see how it is a pretty good candidate for an unjust enrichment consideration by the court. For instance, if someone like Belushi who lives in Los Angeles, would pay travel and lodging expenses in order to visit places of business in Chicago on several occasions on behalf of somebody else, it is more likely than not that he was doing so because of an agreement with that other person and also that he was expecting to get paid for his trouble. The scenario becomes even clearer when you add all the other things Belushi claimed that he did in the course of his promotional work on behalf of The Comedy Bar. However, as in any unjust enrichment case, a party in Belushi’s position would only be awarded the “reasonable value” of his services by the court. This means that Belushi may not get all the money he is asking for unless the court determines that such amount of money represents the reasonable value of his services.

Concerning the alleged trademark agreement, since the agreement was only a draft that never became a valid agreement, the attempt to recover the nearly $17,000 spent for the stage lights, for instance, will probably be treated as unjust enrichment claims.

Then there is the breach of contract claim concerning the alleged loan. To be sure, this one seems more problematic than the other two above for the simple reason that by their very nature loan transactions are typically written down. In the real world, an oral loan agreement is an awfully bad idea because anyone can guess that such an agreement could very easily be denied by the person who has the obligation to pay back the loan. In our case here, the alleged understanding between the parties that the loan would be “repaid in a timely fashion” won’t be enough to save the claim from this problem of proof. This really is a classic evidentiary nightmare. Certainly, the time to “memorialize” the agreement in this case was at the very beginning of the deal.  If the other side is refusing to play ball at this late hour, assuming Belushi’s allegations are true, well, anyone could have guessed that this was a real possibility in situations like this.

Now, how about the defamation claim against Chavoshi? For starters, a defamation action pertains to an alleged injury against someone’s reputation which causes damage to the victim. Here, as stated above, Chavoshi’s alleged “public campaign to malign” Belushi led to the cancellation of some appearances by comedians at other Belushi-branded comedy clubs. Yet, as a well-known celebrity, Belushi will likely be treated as a “public figure” for the purposes of a defamation lawsuit. Usually, as compared to an ordinary Joe, it is more difficult for a celeb to win a defamation claim in America because they’d be required to show that the other person either said something they knew to be false or that they didn’t care that, under the prevailing circumstances, what they said about the celeb was probably false. With an ordinary Joe, somebody could be on the hook for defamation by making a false statement about him even if the maker of the statement didn’t know that the statement they were making was false or that they were merely careless in making the statement. In Belushi’s case here, Chavoshi would probably be off the hook if what she said about Belushi was either true, partly true or could be regarded as merely her opinion of Belushi.

In the end, there is no telling just yet what the final outcome of this case will be. But from experience, cases like this one usually settle before trial because people in business would rather get on with their lives than be spending time and money in court in the company of wrangling lawyers. However, if passions remain high and the matter goes forward, the odds are that Belushi will fare better with the unjust enrichment claims than with the others.

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