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Pura Vida Spirits Co., LLC v. Talent Tree, LLC

Court of Appeals of Texas, Fifth District, Dallas

June 27, 2018


          On Appeal from the 193rd Judicial District Court Dallas County, Texas Trial Court Cause No. DC-16-13924

          Before Justices Bridges, Evans, and Whitehill



         Pure Vida Spirits Co., LLC and Talent Tree, LLC generally agreed that Talent would provide product demonstration services to promote Vida's new tequila product. But Vida refused to pay Talent's full invoice amounts, claiming that Talent poorly performed its services for Vida. Talent then sued to recover the unpaid balance based on breach of express contract, suit on sworn account, and quantum meruit theories.

         Vida appeals the trial court's summary judgment for Talent. The key questions before us are whether (i) Talent conclusively established the essential terms of an express contract between the parties concerning the services at issue and (ii) Vida's summary judgment response raised fact issues regarding the reasonable value of the services that Talent provided. We conclude that the trial court erred by granting Talent's summary judgment motion because the parties' written agreement on which Talent bases its contract claim does not include at least one essential term and there are genuine issues of material fact concerning Talent's other claims. Furthermore, because summary judgment was erroneously granted on Talent's recovery theories, there is no basis for awarding Talent's attorney's fees. We therefore reverse the trial court's judgment and remand for further proceedings consistent with this opinion.

         I. Background

         Vida is a boutique crafter of fine tequila and spirits. Its business model relies on its ability to leverage in-store product demonstrations into sales. To this end, in 2015, Vida began a "Margarita Program" to showcase its tequilas and an orange liquor mixing product called "NARANJA" by mixing margaritas at product demonstrations in liquor stores. These promotions utilized an atypical preparation method by mixing with cocktail shakers to maximize attention and encourage sales.

         Vida contacted Talent to discuss using its services for in-store promotions. The parties signed an agreement on March 6, 2015 (the "Agreement"). Talent maintains that the Agreement governed the parties' relationship throughout the relevant time period. Vida disagrees, claiming that the Agreement lacks essential terms concerning the promotional events at issue.

         Talent performed promotional presentations for Vida from October through December, but Vida refused to pay the related invoices in full. Consequently, Talent sued Vida based on breach of contract, sworn account, and quantum meruit. Talent then moved for traditional and no-evidence summary judgment on its claims. Talent's live pleading and summary judgment motion staked its contract claim on the premise that the Agreement alone was the contract governing the parties' obligations.

         In support of its summary judgment motion, Talent submitted the affidavit of Priscilla Hermes, its president, and an affidavit on attorney's fees. The Hermes affidavit included the Agreement and invoices to Vida totaling $73, 032.66. The invoices relate to services Talent provided in October, November, and December 2015. According to Hermes, $65, 729.40 remained unpaid.

         Vida responded to Talent's motion, and argued that the Agreement lacked essential terms concerning the services Talent was to provide during the period covered by Talent's invoices. Instead, Vida argued that those terms were the subject of an implied contract evidenced by a series of communications beginning in October 2015. In support of its response, Vida submitted the affidavit of its chairman, Stewart Skloss. According to Skloss, the Agreement was for a single event, and the parties began discussing a potential long-term contract the following October. His affidavit included several e-mails reflecting these discussions.

         During those discussions, Skloss emphasized that a "minimum guarantee of each product" was essential. He also specified that the individuals performing the presentations should understand that they were making a "La Primera Cocktail" with ice and "creating an environment/buzz" by doing so and that they were to push sales during the demonstrations. The individuals Talent provided for the promotions were also supposed to know what the demonstration set up should look like and understand Vida's requirements concerning use of the shaker, as reflected in the video training Skloss provided for that purpose. Skloss also stressed that the product demonstrators should adhere to a certain dress code and should not use their cell phones while working.

         On October 13, Talent sent Vida a "Proposal of Services," estimating 400 three-hour events to occur between October and December at a rate of $35 per hour plus bottle incentives. Unlike the Agreement, the proposal specifies the services Talent would provide and the specific requirements for and duties of the Talent representatives conducting demonstrations.

         When Skloss received the proposal, he expressed concern regarding whether Talent could generate a minimum level of sales. Specifically, he emailed Talent that:

. . . Our all-in cost is $198.70 per tasting . . . We would need to sell an average of 20 bottles of tequila, 10 bottles of NARANJA, 5 bottles of bloody mary mix, and 5 bottles of Sangrita to cover the costs. If you guys can guarantee these numbers, sign us up for all the nationwide tastings you can book.
Given your average thus far, how best can we get to where we both need/want to be? We are open to all win/win suggestions.

         The parties continued negotiations, but ultimately did not agree to a contract. Nonetheless, Talent performed demonstrations from October through December. Skloss visited some of the promotions and saw that Talent representatives were not dressed as they were supposed to be, did not engage with customers, did not use Vida's demonstration methods, and were constantly checking their cell phones. Vida complained that the representatives did not make margaritas in almost 50% of the promotions and did not sell a single bottle of tequila during any event. Despite these complaints, Talent billed Vida for the promotions.

         Talent moved for traditional and no-evidence summary judgment on its breach of an express contract, sworn account, and quantum meruit claims. The trial court granted the summary judgment motion "on all of Plaintiff's claims and causes of action." The judgment awards Talent $65, 729.40 in damages and $6, 000 in attorney's fees.

         Vida argues, and Talent concedes, that Talent cannot obtain a no-evidence summary judgment on its own claims. We agree. See Tex. R. Civ. P. 166a (i). Therefore, we consider only whether Talent established that it was entitled to traditional ...

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