RIPPED FROM THE HEADLINES

Meetings & Conventions: Planner's Portfolio July 2003
July 2003 PLANNER'S PORTFOLIO:

The Law & the Planner

By Jonathan T. Howe, Esq.


RIPPED FROM THE HEADLINES

Lessons from two recent meetings-related lawsuits... A patent application update

The past several months have been active ones for meetings-related litigation and court decisions. Here are three items of note.

FORCE MAJEURE
A recent Florida case involved a package-tour company that canceled some bookings related to the 2002 Winter Olympics. The company had made several deposits for a total of $2.5 million to secure hotel rooms in Salt Lake City, then later backed out of the deals and asked for a refund.

In the complaint, the tour operator blamed 9/11, the anthrax scare, terrorism, hostilities in Afghanistan and a perception that the Olympics would likely be targeted by terrorists. The tour company contended these circumstances affected the ability of the Olympic Games to be held in a manner reasonably contemplated by the parties at the time that they entered into the hotel agreements.

The defendant hotels argued, among other points, that the events did not affect the Olympic Games and were not sufficient to trigger the force majeure clause.

An appellate court has reversed a lower court’s dismissal of the suit, and sent the case back to trial for interpretation of the force majeure clause, which specified that deposits would be refunded in the event of material acts “affecting the ability of the Olympic Games to be held.”

The higher court found the clause to be ambiguous and ruled that the trial court shouldn’t have dismissed the case without allowing a judge or a jury to interpret the language of the contract after hearing the evidence during a trial. The phrase “affecting the ability of the Olympic Games to be held,” the justices wrote, could mean preventing the Games altogether, as the defendant claimed, or simply affecting them in some manner, as the plaintiff contended.

The lesson here: Keep ambiguous wording such as “inadvisable” or, as in this case, “affecting the ability of the event to be held” out of force majeure clauses. Be as specific as possible to avoid such entanglements.

DATES ON HOLD
In the oft-volatile world of trade and consumer shows, a promoter has alleged that Kansas City officials breached a promise to allow the promoter to conduct a 2004 boat and RV show, claiming the dates were given away in violation of city policies.

According to newspaper reports, the boat show promoter had been tentatively awarded dates for its annual show to be held in February 2004, but no contract had yet been signed. In September 2002, the city’s Department of Convention and Entertainment Centers moved the show back a week to accommodate an auto show during the same week in February.

The basic snarling point is money: Which show will generate the most income for the city? The auto show apparently was worth twice as much as the boat show.

The lesson for the plaintiff: Litigation could have been avoided if a contract had been signed, with a clause stating the show could not be bumped without the plaintiff’s written consent.

PATENTS
Last year a number of associations and suppliers in the meetings industry received letters from Software Management Inc. indicating it had filed a patent application claiming ownership of methods of handling online registration. That application still has not been acted on by the U.S. Patent Office, possibly because SMI’s application is extremely complicated (it touches on about 160 different points). If the full patent is issued, planners themselves might end up owing royalties any time they use an online registration service that features one of the technologies covered by the patent.