MADISON SQUARE GARDEN CORP.
52 F.2d 47 (2d Cir. 1931)
CHASE, CIRCUIT JUDGE. On January 13, 1931, the plaintiff and defendant by their duly authorized agents entered into the following agreement in writing:
1. Carnera agrees that he will render services as a boxer in his next contest (which contest, hereinafter called the 'First Contest,' shall be with the winner of the proposed Schmeling-Stribling contest, or, if the same is drawn, shall be with Schmeling, and shall be deemed to be a contest for the heavyweight championship title; provided, however, that, in the event of the inability of the Garden to cause Schmeling or Stribling, as the case may be, to perform the terms of his agreement with the Garden calling for such contest, the Garden shall be without further liability to Carnera, exclusively under the auspices of the Garden, in the United States of America, or the Dominion of Canada, at such time, not, however, later than midnight of September 30, 1931, as the Garden may direct.
8. In the event that Camera wins the First Contest, then and in such event Camera grants an option to the Garden for his services as a boxer in his thereafter contests so long as he continues winner thereof, to be held exclusively under the auspices of the Garden, upon the same terms and conditions as herein provided, excepting the percentage applicable to such Contests shall be thirty-seven and one-half per cent (371/2%) instead of twelve and one-half per cent (121/2%), and the opponent in such contests shall be such as may be approved of by the Garden. Such option shall continue so long as the Garden continues to arrange a contest for Camera when Camera shall desire such contest, but in no event closer than thirty days apart, it being understood that should the Garden not so arrange a contest, the option shall end.
9. Camera shall not, pending the holding of the First Contest, render services as a boxer in any major boxing contest, without the written permission of the Garden in each case had and obtained. A major contest is understood to be one with Sharkey, Baer, Campolo, Godfrey, or like grade heavyweights, or heavyweights who shall have beaten any of the above subsequent to the date hereof. If in any boxing contest engaged in by Camera prior to the holding of the First Contest, he shall lose the same, the Garden shall at its option, to be exercised by a two weeks' notice to Camera in writing, be without further liability under the terms of this agreement to Camera. Carnera shall not render services during the continuance of the option referred to in paragraph 8 hereof for any person, firm or corporation other than the Garden. Camera shall, however, at all times be permitted to engage in sparring exhibitions in which no decision is rendered and in which the heavyweight championship title is not at stake, and in which Camera boxes not more than four rounds with any one opponent.
Thereafter the defendant, without the permission of the plaintiff, written or otherwise, made a contract to engage in a boxing contest with the Sharkey mentioned in paragraph 9 of the agreement above quoted, and by the terms thereof the contest was to take place before the first contest mentioned in the defendant's contract with the plaintiff was to be held.
The plaintiff then brought this suit to restrain the defendant from carrying out his contract to box Sharkey, and obtained the preliminary injunction order, from which this appeal was taken. Jurisdiction is based on diversity of citizenship and the required amount is involved.
The District Court has found on affidavits which adequately show it that the defendant's services are unique and extraordinary. A negative covenant in a contract for such personal services is enforceable by injunction where the damages for a breach are incapable of ascertainment.
The defendant points to what is claimed to be lack of consideration for his negative promise, in that the contract is inequitable and contains ho agreement to employ him. It is true that there is no promise in so many words to employ the defendant to box in a contest with Stribling or Schmeling, but the agreement read as a whole binds the plaintiff to do just that, provided either Stribling: or Schmeling becomes the contestant as the result of the match between them and can be induced to box the defendant. The defendant has agreed to "render services as a boxer" for the plaintiff exclusively, and the plaintiff has agreed to pay him a
definite percentage of the gate receipts as his compensation for so doing. The promise to employ the defendant to enable him to earn the compensation agreed upon is implied to the same force and effect as though expressly stated. The fact that the plaintiff's implied promise is conditioned, with respect to the consent with the winner of the Stribling-Schmeling match, upon the contest of that performer, does not show any failure of consideration for the defendant's promise.
As we have seen, the contract is valid and enforceable. It contains a restrictive covenant which may be given effect. Whether a preliminary injunction shall be issued under such circumstances rests in the sound discretion of the court. The District Court, in its discretion, did issue the preliminary injunction and required the plaintiff as a condition upon its issuance to secure its own performance of the contract in suit with a bond for $25,000 and to give a bond in the sum of $35,000 to pay the defendant such damages as he may sustain by reason of the injunction. Such an order is clearly not an abuse of discretion.