Appeal in Super Bowl XLV seating trial

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No. 15-10242 IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT BRUCE IBE; DEAN HOFFMAN; ROBERT FORTUNE; JASON MCLEAR Plaintiffs - Appellants v. JERRAL WAYNE JONES, also known as Jerry Jones; BLUE & SILVER, INCORPORATED; DALLAS COWBOYS FOOTBALL CLUB, LIMITED; JWJ CORPORATION; COWBOYS STADIUM, L.P.; COWBOYS STADIUM GP, L.L.C.; NATIONAL FOOTBALL LEAGUE, Defendants - Appellees --------------------------------------- KEN LAFFIN, Individually and On Behalf Of All Others Similarly Situated; DAVID WANTA, Individually and On Behalf Of All Others Similarly Situated; REBECCA BURGWIN, Individually and On Behalf Of All Others Similarly Situated, Plaintiffs - Appellants v. NATIONAL FOOTBALL LEAGUE; COWBOYS STADIUM GP, L.L.C.; COWBOYS STADIUM, L.P.; DALLAS COWBOYS FOOTBALL CLUB, LIMITED; JWJ CORPORATION Defendants – Appellees ON APPEAL FROM A DECISION OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS, CASE NOS. 3:11-CV- 248 & 3:11-CV-345, THE HONORABLE BARBARA M. G. LYNN APPELLANTS’ OPENING BRIEF Christopher S. Ayres Texas Bar No. 24036167 R. Jack Ayres Texas Bar No. 01473000 Ayres Law Office, P.C. Michael J. Avenatti California Bar No. 206929 Ahmed Ibrahim California Bar No. 238739 Eagan Avenatti, LLP Case: 15-10242 Document: 00513165491 Page: 1 Date Filed: 08/21/2015

description

Plaintiffs appeal in the trial about the Super Bowl XLV seating troubles

Transcript of Appeal in Super Bowl XLV seating trial

No. 15-10242

IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

BRUCE IBE; DEAN HOFFMAN; ROBERT FORTUNE; JASON MCLEAR Plaintiffs - Appellants

v. JERRAL WAYNE JONES, also known as Jerry Jones; BLUE & SILVER,

INCORPORATED; DALLAS COWBOYS FOOTBALL CLUB, LIMITED; JWJ CORPORATION; COWBOYS STADIUM, L.P.; COWBOYS STADIUM GP,

L.L.C.; NATIONAL FOOTBALL LEAGUE, Defendants - Appellees

--------------------------------------- KEN LAFFIN, Individually and On Behalf Of All Others Similarly Situated;

DAVID WANTA, Individually and On Behalf Of All Others Similarly Situated; REBECCA BURGWIN, Individually and On Behalf Of All Others Similarly

Situated, Plaintiffs - Appellants

v. NATIONAL FOOTBALL LEAGUE; COWBOYS STADIUM GP, L.L.C.; COWBOYS STADIUM, L.P.; DALLAS COWBOYS FOOTBALL CLUB,

LIMITED; JWJ CORPORATION Defendants – Appellees

ON APPEAL FROM A DECISION OF THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF TEXAS, CASE NOS. 3:11-CV-

248 & 3:11-CV-345, THE HONORABLE BARBARA M. G. LYNN

APPELLANTS’ OPENING BRIEF

Christopher S. Ayres Texas Bar No. 24036167 R. Jack Ayres Texas Bar No. 01473000 Ayres Law Office, P.C.

Michael J. Avenatti California Bar No. 206929 Ahmed Ibrahim California Bar No. 238739 Eagan Avenatti, LLP

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4350 Beltway Drive Addison, Texas 75001 E-Mail: [email protected] Telephone: 972-991-2222 Facsimile: 972-386-0091 Attorneys for Plaintiffs-Appellants

520 Newport Center Drive, Suite 1400 Newport Beach, CA 92660 E-Mail: [email protected] [email protected] Telephone: (949) 706-7000 Facsimile: (949) 706-7050 Attorneys for Plaintiffs-Appellants

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CERTIFICATE OF INTERESTED PERSONS

A. Parties

Plaintiff-Appellants: Bruce Ibe Robert Fortune

Dean Hoffman Ken Laffin David Wanta Rebecca Burgwin Jason McLear Constance Young (dismissed) Steve Simms (dismissed) Mike Dolabi (dismissed) Wes Lewis (dismissed)

Defendant-Appellees: National Football League (“NFL”) Jerral “Jerry” Wayne Jones (dismissed) JWJ Corporation (dismissed) Cowboys Stadium, L.P. (dismissed) Cowboys Stadium GP, LLC (dismissed) Blue & Silver, Inc. (dismissed)

B. Attorneys

For Plaintiff-Appellants: Michael J. Avenatti, Esq. Ahmed Ibrahim, Esq. Andrew Stolper, Esq. EAGAN AVENATTI LLP 520 Newport Center Dr Suite 1400 Newport Beach, CA 92660 Telephone: 949/706-7000 Facsimile: 949/706-7050 Email: [email protected]

[email protected] [email protected]

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R Jack Ayres , Jr Christopher S Ayres Ayres Law Office PC 4350 Beltway Dr Addison, TX 75001 Telephone: 972/991-2222 Facsimile: 972/386-0091 FAX Email: [email protected]

[email protected]

For Defendant-Appellee NFL: George W Bramblett , Jr Daniel H Gold R Thaddeus Behrens Jonathan D Pressment Haynes & Boone LLP 2323 Victory Ave Suite 700 Dallas, TX 75219 214/651-5000 Email: [email protected] [email protected] [email protected] [email protected]

For Dismissed Def.-Appellees: Levi G McCathern , II Farbod Farnia Hossain Arnold Shokouhi Jesse David Hoffman Paul A Grinke McCathern Mooty LLP 3710 Rawlins Suite 1600 Dallas, TX 75219 Telephone: 214/741-2662 Facsimile: 214/741-4717 Email: [email protected]

[email protected]

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[email protected] [email protected] [email protected]

David W Dodge Glast, Phillips & Murray, P.C. 14801 Quorum Drive Suite 500 Dallas, TX 75254 Tel.: 972/419-8300 Fax: 972/419-8329 Email: [email protected]

By: /s/ Michael J. Avenatti Michael J Avenatti

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STATEMENT REGARDING ORAL ARGUMENT

Pursuant to Federal Rules of Appellate Procedure Rule 34 and 5th

Circuit Rule 28, Appellants request oral argument. Plaintiffs believe oral

argument is warranted because of the benefit it will provide to the Panel in

being able to obtain answers to questions related to this appeal. Oral

argument will be of particular benefit because this appeal involves multiple,

fact-intensive issues. Plaintiffs further believe oral argument is warranted

because several of the motions from the proceeding below that are at issue in

this appeal were decided without oral argument.

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TABLE OF CONTENTS

I.  INTRODUCTION ................................................................................ 1 

II.  STATEMENT OF JURISDICTION .................................................... 2 

III.  STATEMENT OF LEGAL ISSUES .................................................... 2 

IV.  SUMMARY OF ARGUMENT ............................................................ 4 

V.  STATEMENT OF FACTS ................................................................... 7 

A.  The Temporary Seating Project. ......................................................... 7 

B.  The Video Board. ................................................................................. 14 

C.  Super Bowl XLV Tickets................................................................... 17 

D.  Plaintiffs’ Operative Complaint. ...................................................... 17 

E.  Defendants’ Motions to Dismiss. ..................................................... 18 

F.  The Motion for Class Certification. ................................................. 18 

G.  Motion for Summary Judgment. ...................................................... 20 

H.  Trial. ........................................................................................................ 20 

VI.  ARGUMENT ................................................................................ 21 

A. The District Court's Denial of Class Certification Was an Abuse

of Discretion ............................................................................. 21

1. Standard of Review ........................................................ 21

2. The District Court's Denial of Class Certification of the

Displaced Class Was an Abuse of Discretion ............... 21

(a) Plaintiffs Satisfied the Numerosity Requirement

And Joinder Was Impracticable .......................... 22

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(b) Individual Issues on Damages Does Not Preclude

Class Certification .................................................... 23

3. The District Court's Denial of Class Certification of the

Relocated Class Was an Abuse of Discretion ..................... 25

(a) The District Court's Conclusion that Individual Issues

on Liability Predominated Over Common Issues .... 26

(b) Individual Issues on Damages Does Not Preclude

Class Certification .................................................... 26

4. The District Court's Denial of Class Certification of the

Obstructed View Class Was an Abuse of Discretion ......... 27

(a) The District Court Erred in Holding Individual Issues

Predominated on the Obstructed View Class' Breach

of Contract Claim ..................................................... 28

(b) The District Court Erred In Holding Individual Issues

Predominated on the Obstructed View Class'

Fraudulent Inducement Claim .................................. 29

B. The District Court's Order Granting Summary Judgment Was In

Error ........................................................................................ 31

1. Standard of Review ........................................................ 31

2. Summary Judgment Was Improper On The Breach of

Contract Claim Based On the NFL Failing to Provide

Unobstructed Views of the Video Board ....................... 32

3. The District Court Erred In Granting Summary Judgment

On Fraud Claims For Failure to Disclose Obstructed

Views of the Video Board ............................................. 35

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C. The District Court's Charge to the Jury on Plaintiffs Fortune and

Hoffman's Fraudulent Inducement Claim was Error ............... 37

1. Standard of Review ........................................................ 37

2. The District Court Should Have Instructed the Jury on

Fraud Based on Non-Disclosure .................................... 38

3. The Decision Striking Punitive Damages Was Error .... 40

D. The District Court's Dismissal of Plaintiffs' Fraud and DTPA

Claims at the Pleading Stage Was Error .................................. 40

1. Standard of Review ........................................................ 21

2. The District Court's Dismissal of the Cowboys

Defendants Was Error .................................................... 40

(a) Plaintiffs Sufficiently Alleged That the Cowboys

Defendants Were Parties to the Ticket Contract . 40

(b) Plaintiffs May Maintain Tort Claims Against the

Cowboys Defendants Related to the Ticket Sales 42

3. The District Court Erred In Granting The NFL's 12(b)(6)

Motion Dismissing the Fraudulent Inducement Claims of

the Displaced and Relocated Plaintiffs .......................... 43

4. The District Court's Conclusion that the Economic Loss

Rule Barred All of Plaintiffs' Fraudulent Concealment

and Negligent Misrepresentation Claims Was Error ..... 45

5. The District Court's Dismissal of Plaintiffs' DTPA Claims

Based on Fraud Was Error ............................................. 47

VII.  CONCLUSION ............................................................................. 47 

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TABLE OF AUTHORITIES

CASES

Affiliated Ute Citizens v. United States,

406 U.S. 128 (1972) ............................................................................. 29, 30 Amchem Products, Inc. v. Windsor,

521 U.S. 591 (1997) ................................................................................... 25 Amigo Broad., LP v. Spanish Broad. Sys., Inc.,

521 F.3d 472 (5th Cir. 2008) ...................................................................... 33 Anderson, Greenwood & Co. v. Martin,

44 S.W.3d 200 (Tex. App. 2001) ......................................................... 39, 44 Bell Atlantic Corp. v. AT&T Corp.,

339 F.3d 294 (5th Cir. 2003) ...................................................................... 23 Bender v. Brumley,

1 F.3d 271 (5th Cir. 1993) .......................................................................... 37 Butler v. Sears, Roebuck & Co.,

727 F.3d 796 (7th Cir. 2013) ...................................................................... 25 Cardinal Health Solutions, Inc. v. Valley Baptist Med. Ctr.,

2009 WL 150942 (S.D. Tex. Jan. 21, 2009) .............................................. 45 Chesapeake Operating, Inc. v. Whitehead,

2011 WL 4372486 (S.D. Tex. Sept. 19, 2011) ........................................... 40 Citizens Nat’l Bank v. Allen Rae Investments, Inc.,

142 S.W.3d 459 (Tex. 2004) ................................................................ 30, 44 Coffell v. Stryker Corp.,

284 F.3d 625 (5th Cir. 2002) ...................................................................... 44

Consol. Rail Corp. v. Town of Hyde Park, 47 F.3d 473 (2d Cir. 1995) ......................................................................... 22

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Custom Leasing, Inc. v. Texas Bank & Trust Co., 516 S.W.2d 138 (Tex. 1974) ...................................................................... 43

Dell Computer Corp. v. Rodriguez,

390 F.3d 377 (5th Cir. 2004) .......................................................... 32, 33, 34 Eastman Chemical Co. v. Niro, Inc.,

80 F.Supp.2d 712 (S.D. Tex. 2000) ............................................................ 46 Esmark Apparel Co. v. James,

10 F.3d 1156 (5th Cir. 1994) ...................................................................... 21 Experian Info. Solutions, Inc. v. Lexington Allen L.P.,

2011 WL 1627115 (E.D. Tex. Apr. 7, 2011) ....................................... 39, 46 First Nat’l Bank of Wichita Falls v. Fite,

131 Tex. 523 (1938) ................................................................................... 41 Formosa Plastics Corp., USA v. Presidio Eng’gs & Contr., Inc.,

960 S.W.2d 41 (Tex. 1998) ........................................................................ 45 Hawkins v. Frick-Reid Supply Corp.,

154 F.2d 88 (5th Cir. 1946) ........................................................................ 40 Hewlett-Packard v. Benchmark,

142 S.W.3d 554 (Tex. App. 2004) ............................................................. 35 In re Deepwater Horizon,

739 F.3d 790 (5th Cir. 2014) .......................................................... 23, 24, 25 In re Great Southern Life Ins. Co. Sales Practices Litig.,

192 F.R.D. 212 (N.D. Tex. 2000) ............................................................... 30 In re Rodriguez,

695 F.3d 360 (5th Cir. 2012) ...................................................................... 21 In re Visa Check/MasterMoney Antitrust Litigation,

280 F.3d 124 (2nd Cir. 2001) ............................................................... 23, 24

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Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507 (Tex. 1998) ...................................................................... 43

Jones v. Diamond,

519 F.2d 1090 (5th Cir. 1975) .................................................................... 22 Jordan v. Concho Theatres,

160 S.W.2d 275 (Tex. Civ. App. 1941) ..................................................... 32 Kajima Int’l v. Formosa Plastics Corp.,

15 S.W.3d 289 (Tex. App. 2000) ............................................................... 39 Latch v. Gratty, Inc.,

107 S.W.3d 543 (Tex. 2003) ...................................................................... 41 Le Boeuf v. K-Mart Corp.,

888 F.2d 330 (5th Cir.1989) ....................................................................... 37 Livingston Livestock Exch., Inc. v. Hull State Bank,

14 S.W.3d 849 (Tex. App. 2000) ............................................................... 43 Minter v. Great Am. Ins. Co.,

423 F.3d 460 (5th Cir. 2005) ...................................................................... 31 Mullen v. Treasure Chest Casino, LLC,

186 F.3d 620 (5th Cir. 1999) ...................................................................... 22 Nat'l Ctr. for Policy Analysis v. Fiscal Assocs.,

2002 WL 433038 (N.D. Tex. Mar. 15, 2002) ............................................ 39 Nazareth Int’l, Inc. v. J.C. Penney Corp., No.

2005 WL 1704793 (N.D. Tex. July 19, 2005) ........................................... 46 Reeves v. Sanderson Plumbing Prods., Inc.,

530 U.S. 133 (2000) ................................................................................... 31 Regus Management Group, LLC v. International Business Machine Corp.,

2008 WL 1836360 (N.D. Tex. Apr. 24, 2008) ..................................... 39, 46

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Rifkin v. Crow, 574 F.2d 256 (5th Cir. 1978) ...................................................................... 30

Rimade, Ltd. v. Hubbard Enterprises, Inc.,

388 F.3d 138 (5th Cir 2004) ....................................................................... 44 Rio Grande Royalty Co., Inc. v. Energy Transfer P’ners, L.P.,

620 F.3d 465 (5th Cir. 2010) .......................................................... 36, 37, 44 Shandong Yinguang Chem. Indus. Joint Stock Co. v. Potter,

607 F.3d 1029 (5th Cir. 2010) ........................................................ 36, 37, 38 Spoljaric v. Percival Tours, Inc.,

708 S.W.2d 432 (Tex. 1986 ........................................................................ 44 Talen's Landing, Inc. v. M/V Venture, II,

656 F.2d 1157 (5th Cir. 1981) .................................................................... 40 Union Pac. Res. Grp., Inc. v. Rhone-Poulenc, Inc.,

247 F.3d 574 (5th Cir. 2001) ...................................................................... 36 Vander Zee v. Reno,

73 F.3d 1365 (5th Cir. 1996) ................................................................ 39, 40 Vega v. T–Mobile USA, Inc.,

564 F.3d 1256 (11th Cir. 2009) .................................................................. 22

STATUTES 28 U.S.C. § 1291 ............................................................................................. 2

RULES Federal Rules of Appellate Procedure, Rule 29(d) ....................................... 48 Federal Rules of Appellate Procedure, 32(a)(7)(B) ...................................... 48 Federal Rules of Civil Procedure, Rule 9(b) ................................................ 44 Fifth Circuit Rule 32 ..................................................................................... 48

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SECONDARY AUTHORITIES Newberg on Class Actions § 3:12 (5th ed. 2012) ..................................... 4, 22 Newberg on Class Actions § 4:54 (5th ed. 2012) ......................................... 23

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I. INTRODUCTION

This case arises from numerous failures relating to temporary seating at

Super Bowl XLV held at Cowboys Stadium in February 2011. The National

Football League (“NFL”) and the Dallas Cowboys, intent on breaking the Super

Bowl attendance record, devised a plan to increase stadium capacity by installing

over 13,000 temporary seats for the game. They then failed to properly install all

of the seats on time as promised, causing significant damages to be incurred by

fans who on average spent thousands of dollars for the “once-in-a-lifetime”,

“bucket list” experience of attending a Super Bowl involving two of the most

storied franchises in all of professional sports – the Pittsburgh Steelers and the

Green Bay Packers.1 Many fans arrived at Cowboys Stadium on the day of the

Super Bowl only to discover that the seats they had purchased for thousands of

dollars did not exist (“Displaced” fans). Other fans discovered they had been

unilaterally reassigned to different and inferior seats than the ones they purchased

(“Relocated” fans), while thousands of others discovered they had obstructed views

of the playing field, the area above the field, and the prized center-hung video

replay board at Cowboys Stadium (“Obstructed View” fans).

After the district court denied a motion for class certification filed by

Plaintiffs, their individual claims were tried to verdict in March 2015. All seven

plaintiffs prevailed on their breach of contract claims against the NFL. This appeal

challenges the district court’s rulings: (1) denying class certification; (2) granting

in part the NFL and Cowboys’ motion to dismiss various claims; (3) granting in

part the NFL’s partial summary judgment to dismiss certain Plaintiffs’ claims

based on obstructed views of the Video Board; and (4) denying Plaintiffs’ proposed

1 In the game’s 45-year history, the Steelers and the Packers had never before played each other in a Super Bowl. Nor have they played each other since.

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fraudulent non-disclosure instruction to the jury regarding claims based on an

obstructed view.

II. STATEMENT OF JURISDICTION

Plaintiffs appeal a final judgment from the United States District Court for

the Northern District of Texas, Dallas Division. This Court has jurisdiction

pursuant to 28 U.S.C. §1291.

III. STATEMENT OF LEGAL ISSUES

Plaintiff-Appellants identify the following issues raised by this appeal.

Issue 1: Did the district court err in denying class certification of the breach of contract claim of the Displaced Class on the grounds the class was not so numerous as to make joinder impracticable and on the grounds that individual issues of damages predominated?

Issue 2: Did the district court err in denying class certification of the breach of

contract claim of the Relocated Class on the grounds that the NFL’s contention that some class members did not choose a particular seat at the time of purchase created individual issues which predominated and on the grounds that individual issues of damages predominated?

Issue 3: Did the district court err in denying class certification of the breach of

contract claim of the Obstructed View Class on the grounds that individual issues of liability and damages predominated?

Issue 4: Did the district court err in denying class certification of the fraudulent

inducement claim of the Obstructed View Class on the grounds that individual issues of reliance and damages predominated?

Issue 5: Did the district court err in granting summary judgment on the breach of

contract and fraudulent inducement claims for obstructed views of the Video Board based on its ruling that the phrase “spectator seat to the game” in the ticket contract unambiguously and as a matter of law

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granted the ticketholder a seat to view only the four corners of a football field and not the Video Board?

Issue 6: Did the district court err by refusing the Obstructed View Plaintiffs’

request for a fraudulent non-disclosure jury instruction on their claim alleging the NFL failed to disclose material information that would have rendered earlier representations untrue or misleading, or which conveyed a false impression?

Issue 7: Did the district court err by dismissing all of Plaintiffs’ claims against

the Dallas Cowboys-related defendants where the complaint alleged the Cowboys were a contracting party by virtue of their sale of tickets and the evidence demonstrated they were agents of the NFL by binding themselves contractually with the NFL to deliver the completed seats to Plaintiffs?

Issue 8: Did the district court err by granting Defendants’ motion to dismiss for

the Displaced and Relocated Plaintiffs’ failure to state a claim for fraudulent inducement, along with the connected claims for violations of the Texas Deceptive Trade Practices Act (DTPA), on the grounds that (a) Plaintiffs were required to allege a specific intent not to perform the ticket contracts (as opposed to alleging the lower recklessness standard), (b) Plaintiffs were required to allege that the tickets were sold to Plaintiffs after Defendants knew they would not be completed, and (c) Plaintiffs’ allegation of a specific intent to defraud was implausible?

Issue 9: Did the district court err by granting Defendants’ motion to dismiss due

to all Plaintiffs’ failure to state a claim for fraudulent concealment, negligent misrepresentation, and connected claims for violation of the DTPA, on the ground that they are barred by the economic loss rule?

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IV. SUMMARY OF ARGUMENT

This case is a highly complex dispute involving numerous parties (and

thousands of putative class action members) from across the United States who

attended Super Bowl XLV at Cowboys Stadium. Appellants present numerous

issues on appeal and reversal on any or all of these matters materially affects the

outcome of these and hundreds of pending claims. Plaintiffs’ arguments may be

summarized as follows:

First, the district court erred in denying class certification of the Displaced

Class (ticketholders who purchased a seat but were denied a seat when they arrived

on game day) on the grounds that the class was so numerous as to make joinder

impracticable and that individual issues of damages predominated. Here, the class

was at least 40 persons and because “a class of 40 or more members raises a

presumption of impracticability of joinder based on numbers alone,” Plaintiffs

satisfied the numerosity requirement. See William B. Rubenstein, Newberg on

Class Actions §3:12 & n.9 (5th ed. 2012). Additionally, because each class

member suffered damage as a result of Defendants’ conduct, differences in the

amount of their damages does not preclude class certification.

Second, the district court erred in denying class certification of the Relocated

Class (ticketholders who purchased a seat but were relocated to a different and

inferior seat when they arrived on game day). Whether each class member picked

a particular seat or purchased a ticket without knowing their exact location in the

stadium did not create an individual issue, and certainly not one that predominated

over the other common issues identified by the district court. That class members

suffered different amounts of damages likewise did not defeat class certification.

Further, the district court was wrong in concluding that individual issues

predominated as a result of each class member needing to show his or her seat was

of “lesser quality.”

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Third, the district court erred in denying class certification of the Obstructed

View Class (ticketholders whose ticket did not disclose any obstructed view but

whose seat had an obstructed view of the playing field or Video Board) on their

breach of contract claim. The district court’s conclusion that an individualized

inquiry to determine the extent of obstruction for every class member was required

was wrong because common evidence showed that any obstructed view of the field

or Video Board was material. Indeed, the evidence showed that whether a person’s

view was 10 percent, 50 percent, or 99 percent obstructed, the NFL generally

treated all such seats as simply “obstructed” and reduced the face value of all of the

tickets they marked as “Restricted View” across-the-board to $600.2 Beyond that,

methods were available to ascertain the extent of the obstructions using common

evidence. Further, that class members suffered differing amounts of damages did

not defeat class certification.

Fourth, the district court erred in denying class certification of the

Obstructed View Class on their fraudulent inducement claim. The district court’s

ruling that individual issues of reliance predominated over common issues was

error because the law recognizes a presumption of reliance in class cases asserting

fraud based on a material omission (as in this case). In addition, the court’s

conclusion that individual issues on damages precluded class certification was

error.

Fifth, the district court erroneously granted the NFL’s summary judgment

motion on Plaintiffs’ breach of contract and fraud claims relating to obstructed

views of the Video Board. The district court entered its order based on its incorrect

determination that the phrase in the ticket contract granting the ticket holder “entry

2 This case involves seats that the NFL failed to mark and failed to reduce in price.

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in the stadium and a spectator seat for the game” is unambiguous and does not

grant a right to see the Video Board.

Sixth, the district court’s refusal to instruct the jury on fraudulent non-

disclosure in connection with Plaintiffs’ claims for being sold seats with obstructed

views of the playing field was erroneous. The evidence presented at trial supported

an instruction on fraudulent non-disclosure based on the NFL’s failure to disclose

material facts that rendered earlier representations misleading or untrue, and/or

conveyed a false impression. Moreover, the fact that the NFL acquired the material

information after it distributed tickets does not relieve it of liability.

Seventh, the district court’s dismissal of Plaintiffs’ contract and fraudulent

inducement claims against the Cowboys Defendants at the pleading stage was

erroneous because Plaintiffs sufficiently alleged that one or more of the Cowboys

Defendants were parties to the ticket contracts, or at a minimum, were agents of the

NFL who had a contractual obligation to install the seats.

Eighth, the district court improperly dismissed the Displaced and Relocated

Plaintiffs’ fraudulent inducement claims, along with connected claims for

violations of the Texas Deceptive Trade Practices Act (DTPA) at the pleading

stage. The court’s holding that Plaintiffs had not plausibly alleged fraudulent intent

was improper because (a) Plaintiffs were not required to allege Defendants’

specific intent not to perform the ticket contracts and instead their allegations

merely had to meet the lower standard of recklessness, (b) Plaintiffs’ allegation of

the NFL’s specific intent to defraud based on the desire to break the Super Bowl

attendance record, avoid an embarrassing public relations mess, and maximize

revenues, was not implausible, and (c) Plaintiffs were not required to allege

fraudulent intent with specificity. Further, the court’s ruling that Plaintiffs had to

allege the tickets were sold to Plaintiffs after Defendants knew they would not be

completed was erroneous because fraud may be based on misrepresentations and

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omissions occurring after the execution of a contract, including information the

seller learns after the contract is entered into.

Ninth, the district court’s conclusion that the economic loss rule barred all of

Plaintiffs’ fraudulent concealment and negligent misrepresentation claims, along

with connected DTPA claims, was erroneous because (a) these claims were

fraudulent inducement claims not subject to the economic loss rule, (b)

concealment based tort claims are premised on duties separate and independent

from any duties created by contract, and (c) fraud and negligent misrepresentation

claims based on concealment or omission of material facts are not subject to the

economic loss rule.

V. STATEMENT OF FACTS

A. The Temporary Seating Project.

The Super Bowl is an event put on by the NFL. [ROA.10847] In 2007, the

NFL awarded the right to host Super Bowl XLV to the North Texas Super Bowl

XLV Bidding Committee, which had proposed the game be played at Cowboys

Stadium in Arlington, Texas. [ROA.10847] As part of the bid process, the NFL

consented to the addition of nearly 13,000 temporary seats at Cowboys Stadium.

[ROA.16359:12-17] The Dallas Cowboys’ organization was charged with the

responsibility for installing the temporary seats and entered into an agreement with

the NFL requiring the Cowboys to install the seats by January 30, 2011 (no later

than one week before game day on February 6, 2011). [ROA.15755:10-15756:2]

In order to complete this task, the Cowboys hired Scott Suprina of Seating

Solutions. [ROA.15802:3-10] The NFL hired Todd Barnes of Populous as its lead

event-planning consultant for Super Bowl XLV. [ROA.15813:14-20;

ROA15816:22-15817:7] The NFL also assigned Frank Supovitz, Senior Vice

President of Events for the NFL, with responsibility for overseeing all aspects of

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the Super Bowl, including the installation of temporary seats. [ROA.15645:7-11;

ROA.15647:12-15]

Months before the game, in approximately September 2010, the NFL and

Populous learned of issues related to Seating Solutions ability to install all of the

temporary seats. More specifically, none of the temporary seats had been erected

and internal discussions at the NFL and with the Cowboys reflected the NFL’s

belief that Seating Solutions/Suprina could not be trusted and could not

competently install the required seats. [Trial Ex. 60; ROA.16053:17-22;

ROA.17139:6-24; ROA.17143:4-10] Around this time, Populous discovered that

according to seating plans prepared by Suprina, numerous seats would have

obstructed views. This alone impacted over 1,400 temporary seats. On September

27, NFL Director of Ticketing Fred Otto wrote to Barnes and Supovitz after

becoming aware of the problem with substandard seats, stating: “Scott [Suprina]

said I would never install a seat I would not sit in myself” and that he was “not

forthright at all.” On this date at the latest, Supovitz and the NFL knew that neither

Barnes nor Otto trusted Seating Solutions and. [ROA.17143:4-10]

Super Bowl XLV tickets were sent to the NFL’s printer to be printed on or

about October 29, 2010. [ROA.9660-9661; ROA.9031; ROA.9239] There, certain

tickets marked with the legend “Restricted View” were printed to designate

obstructed view seats and thus alert certain purchasers. [ROA.9660-9661;

ROA.9239] Other than those tickets printed with the “Restricted View” legend on

October 29, however, no other tickets were later marked “Restricted View” even

though, as discussed below, the NFL subsequently discovered there would be many

additional obstructed view seats. [ROA.9646:23-9647:17]

Under the terms of the agreement negotiated with the Cowboys organization,

the NFL did not have control of Cowboys Stadium in order to begin installation of

seats until January 8, 2011. [ROA.15904:11-15]

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Beginning around January 9, 2011, the NFL and Populous were very

concerned about obstructed views of the playing field from the temporary seats in

rows 4 and above in the “Curves” sections, which are among the sections where

Plaintiffs Fortune and Hoffman sat. [ROA.7468 at ¶9; ROA.9844-9845;

ROA.9847-9848; ROA.9851-9852; ROA.9855-9856; ROA.9632; ROA.9946-9947;

ROA.9978; ROA.10268; ROA.15867:16-15869:7]

In internal e-mails, the NFL and Populous conceded “there will be

complaints about” the seats, they “wouldn’t be worthy of selling,” they “look

awful,” they are “really bad,” and the seats are a “mess.” [Trial Exs. 69, 68, 179,

256; ROA.17170:19-17172:10; ROA.17167:7-14; ROA.16529:5-16] By late

January 2011, Barnes came to the conclusion that Seating Solutions’ plans could

not be relied upon, because the surveys were not performed very well. [Trial Ex.

275; ROA.16063:5-16064:21; ROA.17230]

On January 26, 2011, Barnes sent an e-mail to Fred Otto attaching drawings

containing Barnes’ notes documenting “seating concerns at the west end.”

[ROA.17091:19-17092:7; Trial Ex. 552] In these notes, Barnes communicated his

concerns about poor sightlines to the playing field in various sections.

[ROA.17093:4-19; ROA.17092:8-16; Trial Ex. 552] Among the problems Barnes

identified were “poor sightlines due to ADA column” in “Rows 1 - 3” in section

218A. [ROA.17093:12-14; Trial Ex. 552] As noted below, Plaintiff Hoffman sat

in section 218A, Row 23 (which is the same as Row 3). [ROA 17092:23-17093:3;

Trial Ex. 552]

On January 27, 2011, Barnes sent an e-mail to Otto attaching drawings

containing Barnes’ “remaining seat plan notes that covers the east end.”

[ROA.17085:4-11; Trial Ex. 554] Again, Barnes communicated to Otto his

concerns about poor sightlines in various sections. [ROA.17087:15-17089:5; Trial

Ex. 554] Among the problems Barnes identified was a concern about “Row 4” of

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section 241A having a “sightline obstructed due to column.” [ROA.17090:24-

17091:4; Trial Ex. 554] As noted below, Plaintiff Fortune sat in section 241A,

Row 23 (which is the same as Row 3), Seat 1, and his sightline was also obstructed

by a concrete support beam. [ROA.16441:23-16442:16; 16153:4-6]

In addition, one of the NFL’s temporary employees hired to raise sightline

issues in the week leading up to the Super Bowl and bring them to the attention of

Populous, made important handwritten notes about Fortune’s seats in connection

with his review of the seats prior to the Super Bowl. [ROA.16555:19-16556:5;

ROA.16582:16-16583:14; Trial Ex. 182] He wrote that at least one of Mr.

Fortune’s seats was “OBST” and also wrote “AWFUL!” in the margin of the page

next to a listing of seats in Fortune’s section. [ROA.16582:16-16583:14] Otto

confirmed that “OBST” was the nomenclature he would use to identify a potential

sightline issue. [ROA.16571:21-16572:5; Trial Ex. 182]

As noted above, the NFL’s contract with the Cowboys required the seats to

be completed by January 30, 2011 and yet they were not complete on that date.

[ROA.15755:20-15756:2; ROA.15867:3-8; ROA.16065:1-4; Trial Ex. 119]

Despite this fact, the NFL took no efforts to inform any of the fans.

[ROA.15867:1-12; ROA.15868:4-11; ROA.16060:14-16061:11]

In the week leading up to the Super Bowl, the NFL continued to be highly

concerned about the completion of the seats in time for the game and yet failed to

tell the fans anything. [Trial Exs. 150, 166, 267, 280, 284; ROA.16056:23-16058:5;

ROA.16059.23-16061:24; ROA.15975:13-21; ROA.15993:2-15994:8; ROA.

16080:7-17; ROA.16644:3-15; ROA.16645:21-16646:9] The NFL, Populous, and

the Cowboys continued to exchange e-mails expressing their concerns. On

February 1, 2011, with knowledge of the impending chaos that was to ensue on the

day of the game, the NFL ordered additional security to deal with fans on game day

who the NFL knew would be irate over the seating issues. [ROA.15913:9-18;

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ROA.15974:18-23] Despite these known problems, the NFL made no attempt to

inform the fans of anything relating to the seat problems. [ROA.16375:8-10;

ROA.16060:17-16061:11; ROA.16228:20-16229:7; ROA.16640:5-20] At trial,

Plaintiffs presented evidence showing the NFL chose not to disclose the problems

with the temporary seating project for a number of reasons. [ROA.15909:20-

15911:25]

First, the NFL chose to install the temporary seats, and install and leave all

of the obstructed view seats in the stadium, in an attempt to assist one of the most

powerful owners in the NFL, Jerry Jones, in achieving his goal of breaking the all-

time Super Bowl attendance record. Plaintiffs presented extensive evidence,

including internal e-mails and admissions from the testimony of Jones, Roger

Goodell (the NFL Commissioner), Supovitz and others, demonstrating an

obsession with breaking the attendance record even while the NFL was in the midst

of dealing with what should have been the bigger problem of getting the seats

properly installed. [Trial Exs. 52, 73, 159, 311; ROA.17380:10-24;

ROA.15625:16-15653:20; ROA.15679:20-15681:3; ROA.15853:1-24;

ROA.15936:5-10; ROA.15937:6-18; ROA.16295:17-24; ROA.16297:1-16928:24;

ROA.17324:13-19; ROA.17325:12-21]

Second, the NFL sought to avoid the public relations debacle that would

ensue if it had to disclose before the game that the seats would not be ready or that

certain seats had obstructed views. [Trial Exs. 172, 284, 293; ROA.15978:4-

15982:15; ROA.16084:4-16085:10; ROA.16227:6-16229:13; ROA.16231:11-16;

ROA.16232:7-17; ROA.16235:17-16236:10] Indeed, because tickets had been

printed and distributed, the NFL could not provide proper disclosures on tickets

and thus instead would have to endure the embarrassment of making a public

announcement at a time when the NFL, Jones and the Cowboys wanted all eyes of

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the worldwide media on the Super Bowl and its hype in anticipation of the game.

[ROA.15677:12-15679:10]

Third, the NFL chose not to disclose problems with the seats because of the

loss in revenues the NFL would have to experience from either lowering the face

value of the tickets (which they could not do because the tickets were already

printed and distributed) or from removing the seats from the stadium altogether.

The evidence showed that the NFL was keenly focused at all times on maximizing

revenues and profits at Super Bowl XLV. [Trial Exs. 50, 158; ROA.16305:23-

16311:10; ROA.17317:12-17318.11] Indeed, at his “Commissioner’s Briefing” in

January 2011, Goodell was briefed as to the significant increase in revenue and net

income the NFL was projected to receive over the prior two Super Bowls based on

a huge increase in stadium gate receipts driven by sales of the temporary seats.

On February 6, the day of the Super Bowl arrived. Over 400 seats within

certain areas in sections 425A and 430A were not completed and approved for use

in time for the game. [ROA.15880:17-15881:4] This included seats purchased by

Plaintiffs Bruce Ibe and his daughter (Section 430A, Row 25, Seats 17-18)

[ROA.16152:18-22], David Wanta (Section 425A, Row 28, Seat 27)

[ROA.16153:1-3], and Ken Laffin (Section 425A, Row 28, Seat 26).

[ROA.16152:23-25] When they arrived at the game, Ibe, Laffin, Wanta and like

fans were held by the NFL in a “fenced-in” area in substandard conditions with no

information about why their seats were not ready or available. [ROA.16172:5-24]

Later, they were taken to a partially below-ground “bar” where they had no view of

the game on the field and were forced to attempt to watch the game on television

monitors. [ROA.16175:25-16176:8; ROA.16990:1-5]

In addition, over 850 other seats were not completed and approved for use in

time for the game. [ROA.16324:17-25] These included seats purchased by

Plaintiffs Jason McLear (Section 230A, Row 24, Seats 14-16) [ROA.16153:15-17,

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and Rebecca Burgwin (Section 215A, Row 28). [ROA.16153:21-24] McLear and

his family, along with Burgwin and her husband, were relocated to worse seats.

[ROA.16669:5-10; ROA.16761:1-12] McLear missed most of the first quarter of

the game. [ROA.16668:17-20] Burgwin and her husband were separated from

their daughters. [ROA.16760:22-25]

Plaintiffs Robert Fortune and Dean Hoffman were among thousands of fans

who appeared at their assigned seats only to discover that their seats had obstructed

sightlines. [ROA.16441:23-16442:16; ROA.16593:16-16594:17] Fortune bought

two tickets for he and his wife to attend Super Bowl XLV. [ROA.16153:4-6] His

seats were to be located in Section 241A, Row 23, Seats 1 and 2. [ROA.16153:4-

6] The tickets did not contain a disclosure notifying him that the seats had a

“Restricted View.” [ROA.16427:12-16; Trial Ex. 25] Yet, Fortune observed from

his and wife’s seats that their view of the field and Video Board were obstructed by

the concrete overhang above and by an aluminum railing and concrete support

beam. [ROA.16441:23-16442:16] Fortune obtained photographs and a short video

depicting the obstructed views from his and his wife’s seats, which was shown to

the jury at trial. [ROA.16442:20-16445:8; Trial Exs. 26, 376]

Dean Hoffman purchased three tickets for him and his two children to attend

the game. [ROA.16153:7-9] His tickets stated that his seats were to be located in

Section 218A, Row 23, Seats 16-18 and did not contain a disclosure notifying him

that the seats had a “Restricted View.” [ROA.16153:7-9; Trial Ex. 37] Hoffman,

however, observed from his and his children’s seats that their view of the field and

Video Board were obstructed by the concrete overhang above them.

[ROA.16593:16-16594:17]

Each of the Plaintiffs were fans for whom attending the Super Bowl was

supposed to be a once in a lifetime experience, or “bucket list” item.

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[ROA.15929:9-11; ROA.16159:5-8; ROA.16336:6-11; ROA.16421:15-16422:21;

ROA.16757:11-14]

B. The Video Board.

Cowboys Stadium is home to “the largest video board installation in the

world.” [ROA.9689] The stadium’s signature video replay and scoreboard

(hereafter, the “Video Board”) hangs approximately 90 feet above the center of the

field and spans 60 yards. [ROA.9932-9933] The Video Board cost more than $40

million; actually contains four Video Boards - two facing the sidelines and two

smaller ones facing the end zones; and covers a screen area of 11,393 square feet.

[ROA.9932-9933] The NFL and the Cowboys touted and hyped the Video Board

and its importance as being part of the game at nearly every possible opportunity

during the weeks and months leading up to the Super Bowl. [ROA.9932-9933;

ROA.9935; ROA.9937-9944; ROA.10182] Fred Otto admitted the Video Board

was “part of the big draw of their stadium.” [ROA.9635]

During discovery, the NFL also admitted that nearly all of the temporary

seats installed on the Main Concourse Level “did not have an unobstructed view of

the entirety of the video board hanging above the center of Cowboys Stadium while

seated.” [ROA.9787-9788 at 13] This admission also necessarily means that fans

would not have views of many “punts” during the game and also would not be able

to see whether certain field goals and extra points were “good” or not because the

top of the goal posts were obstructed. On January 10, 2011, Barnes identified 16 of

these sections (all in the “Curves”) in an e-mail to the NFL. [ROA.9946-9947;

ROA.9858-9859] Barnes stated that “any seat above the first row of the temp seats

will have trouble seeing the videoboard.” [ROA.9946-9947; ROA.9858-9859]

According to testimony of NFL Commissioner Goodell, an obstructed view

seat is defined by the NFL as follows:

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Generally obstructed view means any seat in the stadium

that doesn't have a full view of the stadium because of a

structural issue. It could be an overhang. There would

be a pole, some kind of structural device in the stadium.

[ROA.9743:5-10 (emphasis added).] Goodell admitted that this has been the

definition of an obstructed view seat from even before Goodell became

Commissioner. [ROA.9743:11-9744.14]

The evidence showed that the NFL had “killed” other seats solely because of

problems with sightlines to the Video Board. [ROA.9845; ROA.9847-9850;

ROA.9852-9853; ROA.9957; ROA.9959-9961; ROA.9969-9971] Suprina, the

temporary seating contractor, removed certain seats because Barnes told him that

Frank Supovitz found seats with obstructions to the Video Board to be

“unsatisfactory.” [ROA.9968; ROA.9972]

On January 9, Barnes and Otto exchanged e-mails attaching photos from

seats showing no obstructions to the playing field while seated, but depicting

obstructions to the Video Board. [ROA.9850; ROA.9959-9961; ROA.9975-9976;

ROA.9978] Otto’s reaction to the photos was: “These look awful - once again,

please send me the list of all sections affected[.]” [ROA.9851; ROA.9978]

Sightlines to the Video Board from the temporary seats was also a written

requirement of the seating project early on. In March 2010, Jack Hill of the Dallas

Cowboys sent Suprina a “Stadium Bid Package” (hereafter, the “RFP”).

[ROA.9966, ROA.9983-9998] Hill was responsible for overseeing the seating

project on behalf of the Cowboys organization. [ROA.9901; ROA.9914-9915]

Significantly, the RFP required bidders to “submit preliminary drawings indicating

. . . sight lines for viewing of the center hung video board.” [ROA.9917 (emphasis

added); ROA.9987] Hill testified that this was a requirement of the project.

[ROA.9912-9913; ROA.9916-9918; ROA.9920; ROA.9923, ROA.9966-9967]

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Hill also presented a drawing within the RFP showing temporary seats with a line

drawn to the end zone Video Board, which depicted a sightline and the requirement

that there be sightlines to the Video Board. [ROA.9919; ROA.9994]

In internal communications between the NFL, Cowboys, and Populous, the

parties all routinely discussed seats with obstructions to the Video Board as being

obstructed view seats. For example, on August 28, 2010, Otto, reacting to photos

he received depicting obstructed views of the Video Board stated: “I do not see

how their seats would not be obstructed??” [ROA.10012-10013 (emphasis added)]

Barnes responded: “You are correct. It appears to me that they will be

obstructed.” [ROA.10012-10013] At deposition, Otto testified that these seats

were “not fine” because they did not have a full view of the Video Board.

[ROA.16521:3-18] Importantly, Otto was the “final decision-maker” on whether

to mark seats obstructed view after gathering input from others. [ROA.16388:18-

16390:5; ROA.16531.20-16532.1]

On January 10, admitting there were serious problems in selling seats which

“will have trouble seeing the videoboard,” Barnes stated: “[b]y the way, wasn’t it

Scott Suprina who said he would never design a seat that wouldn’t be worthy of

selling?” [ROA.9860; ROA.10057-10058] Barnes admitted this comment was

directed only to seats with trouble seeing the Video Board and conceded it was “a

problem for the NFL.” [ROA.9841; ROA.9860] Barnes also told the NFL “[t]here

will be complaints about” seats with obstructed views of the Video Board.

[ROA.9863; ROA.11746-11747] Supovitz also expressed concerns about not being

able to see the Video Board from certain seats. [ROA.9968]

Further, it is undisputed that the NFL attempted to identify temporary seats

with poor sightlines to the Video Board (i.e. it was “material”). [ROA.9618;

ROA.9630; ROA.9840; ROA.9927-9928; ROA.9964] Barnes testified he

performed a sightline analysis to determine the view from the temporary seats to

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the Video Board and that such an analysis is routine in all Super Bowls.

[ROA.9840-9841] The NFL identified these problem seats in its interrogatory

responses. [ROA.9787-9788 at 13.]

C. Super Bowl XLV Tickets.

Super Bowl XLV tickets promised purchasers an assigned seat at the game

corresponding to a specific section, row, and seat number. [ROA.9449;

ROA.9461; ROA.9476; ROA.9490-9491; ROA.9525-9526; ROA.9561;

ROA.9576] Each ticket provided that “[t]his ticket grants entry in the stadium and

a spectator seat for the game.” [ROA.9490-9491; ROA.9525-9526] Further, each

ticket promises that Super Bowl XLV will take place on Sunday, February 6, 2011,

at 5:00 p.m. and that fans will have the ability to enter the stadium when gates open

at 1:00 p.m. [ROA.9490-9491] None of the tickets Plaintiffs purchased contain

any disclosures alerting them to their seats having obstructed views of the playing

field or Video Board. [ROA.9443; ROA.9449; ROA.9457; ROA.9461;

ROA.9471; ROA.9476; ROA.9486; ROA.9490-9491; ROA.9509; ROA.9525-

9526; ROA.9549; ROA.9561; ROA.9564; ROA.9576]

Frank Supovitz approved the final version of the ticket. [ROA.9599;

ROA.9613] Supovitz testified that the stadium gates were supposed to open by

1:00 p.m. according to the ticket. [ROA.9600] He also understood this statement

to mean that “it was our intention to open the gates [at] 1:00 p.m.” [ROA.9614]

D. Plaintiffs’ Operative Complaint.

Plaintiffs filed this case as a class action against the National Football

League (“NFL”), the Dallas Cowboys Football Club, Ltd. (“Dallas Cowboys”),

JWJ Corporation (“JWJ”), Cowboys Stadium, L.P. (“Cowboys Stadium L.P.”),

Cowboys Stadium GP, LLC (“Cowboys Stadium GP”), Blue & Silver, Inc. (“Blue

& Silver”) and Jerral “Jerry” Wayne Jones (“Jerry Jones”) (collectively with the

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NFL, “Defendants”, and collectively without the NFL, the “Cowboys

Defendants”). [ROA.67]

Plaintiffs’ Consolidated First Amended Complaint asserted causes of action

against all Defendants for breach of contract, breach of the covenant of good faith

and fair dealing, fraudulent inducement, fraudulent concealment, two separate

counts of negligent misrepresentation based on affirmative misrepresentations and

concealment, violations of the DTPA, and negligence. [ROA.564]

E. Defendants’ Motions to Dismiss.

On December 21, 2011, Plaintiffs filed a consolidated First Amended

Complaint. [ROA.564] On July 19, 2012, the district court denied in part, and

granted in part without leave to amend, Defendants’ motion to dismiss Plaintiffs’

tort claims in their First Amended Complaint. [ROA.1119] The court dismissed

the fraudulent inducement, fraudulent concealment, and negligent

misrepresentation claims of the Displaced Plaintiffs and Relocated Plaintiffs.

[ROA.1125-1126] The court also dismissed the Displaced and Relocated

Plaintiffs’ claims for violations of the DTPA based on fraud, and all of Plaintiffs’

DTPA claims based on breach of express and implied warranties [ROA.1127-

1128]. Finally, the court dismissed all of Plaintiffs’ claims against the Cowboys

Defendants in their entirety without leave to amend. [ROA.1130]

F. The Motion for Class Certification.

Plaintiffs sought to certify the lawsuit as a class action with three principal

classes of plaintiffs. [ROA.2657]

Specifically, Plaintiffs moved for the certification of a Displaced Class.

[ROA.2669.] This group of ticketholders, represented by Plaintiffs Ibe, Wanta, and

Laffin, consisted of all persons who paid for and/or acquired tickets to Super Bowl

XLV and were denied seats to the game. [ROA.2672-2673] The class was

comprised of persons who bought and/or acquired tickets for the following seats

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within Cowboys Stadium: Section 425A, Row 22, Seats 6-21; Rows 23-32, Seats

4-21; Row 33, Seats 1-21; and Section 430A, Row 22, Seats 13-28; Rows 23-32,

Seats 13-30; Row 33, Seats 13-33. [ROA.3106 at 1.] The NFL later admitted that

“Super Bowl XLV ticketholders were entitled to a seat for the game and that the

NFL was unable to provide a seat to the Super Bowl XLV holding tickets” to the

above-referenced seats. [ROA.3106] While at the time the lawsuit was filed, more

than 400 fans were estimated to be part of the Displaced Class, after settlements

orchestrated by the NFL, Plaintiffs estimated that there were at least 55 individuals

remaining in the Displaced Class at the time Plaintiffs moved for class certification.

[ROA.2673; ROA.2706]

Plaintiffs also moved to certify a Delayed/Relocated Class. [ROA.2673]

This Class consisted of a Delayed Subclass and Relocated Subclass. [ROA.2673]

The proposed Relocated Subclass (referred to hereinafter as the “Relocated

Class”), represented by Plaintiffs McLear and Burgwin, consisted of ticketholders

who were delayed in gaining access to their seats because their assigned sections

were not ready to be occupied until well past the time the stadium doors opened at

1:00 p.m. as expressly promised. [ROA.2673-2674] These individuals were

relocated away from their assigned seats to lesser quality seats. [ROA.2673] It

included all rows and seats within Sections 205A, 215A, 230A, and 240A. The

NFL did not dispute this definition. [ROA.3107-3108 at 3).]

Finally, Plaintiffs sought to certify an Obstructed View Class. [ROA.2675]

This group of ticketholders, represented by Plaintiffs Fortune and Hoffman,

consisted of ticketholders who acquired seats with obstructed views of the playing

field and/or Video Board. [ROA.2675] Obstructed view seats were located

throughout the stadium within the temporary seating sections. [ROA.2710-2712]

Plaintiffs relied on internal NFL photographs, diagrams, and spreadsheets showing

that there were obstructed view seats in numerous temporary seating sections

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throughout the stadium. [ROA.2742-2746; ROA.2755-2758; ROA.2865-2875;

ROA.2947-2948; ROA.2950; ROA.2971; ROA.4804-4806; ROA.4808-4809;

ROA.4811; ROA.4813-4814;; ROA.4828-4830] Plaintiffs also submitted

affidavits of Fortune and Hoffman, as well as affidavits of unnamed class members

who sat in various sections and confirmed they had obstructed views, to support

class certification. [ROA.2742-2746; ROA.2755-2758; ROA.2786-2788;

ROA.2792-2794; ROA.2799-2801; ROA.2806-2808; ROA.2813-2815;

ROA.2820-2822; ROA.2829-2831; ROA.2829-2831; ROA.2835-2837]

Even though it denied the existence of any seat having an obstructed view of

the playing field, the NFL admitted all of the seats in rows 36 through 45 in

sections 201A-204A, 216A-219A, 226A-229A, 241A-244A, 220A-224A, and

245A-249A “did not have an unobstructed view of the entirety of the video board

hanging above the center of Cowboys Stadium while seated.” [ROA.3136-3137 at

13]

On July 9, 2013 the district court denied Plaintiffs’ class certification motion

in its entirety. [ROA.7221]

G. Motion for Summary Judgment.

On July 15, 2013, the NFL filed its Motion for Partial Summary Judgment

and for Partial Dismissal for Lack of Subject Matter Jurisdiction. [ROA.7266] On

September 30, 2014, the district court entered an order dismissing the fraudulent

inducement claims of plaintiffs based on obstructed view of the Video Board, but

denying the remainder of the motion. [ROA.10770-ROA.10792]

H. Trial.

Trial in this matter occurred on March 2nd through 12th, 2015. On March

10, the district court granted, in part, the NFL’s motion for judgment as a matter of

law pursuant to Rule 50(a). [ROA.17440:19-17441:2] The court denied the NFL’s

motion to dismiss Plaintiffs Fortune and Hoffman’s fraudulent inducement claim,

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but granted the NFL’s motion to dismiss Plaintiffs’ request for punitive damages.

That same day, at the charge conference, the court denied Plaintiffs’ Proposed Jury

Instruction No. 18 by which Plaintiffs requested that the jury be given an

instruction on fraudulent inducement based on non-disclosure.

The jury was charged on March 12. [ROA.14791] On March 13, the jury

returned a verdict finding the NFL breached its contract as to all seven Plaintiffs

and awarding damages of between $5,670.00 and $22,000 to the various Plaintiffs.

The jury also found the NFL was not liable for fraudulent inducement as to

Plaintiffs Fortune and Hoffman. [ROA.14808]

On March 25, the Court entered judgment in accordance with the verdict.

[ROA.14821]

VI. ARGUMENT

A. The District Court’s Denial of Class Certification Was an Abuse

of Discretion.

1. Standard of Review

This Court reviews a district court’s ruling on a class certification motion for

abuse of discretion. See In re Rodriguez, 695 F.3d 360, 364 (5th Cir. 2012). “A

district court abuses its discretion if it bases its decision on an erroneous view of

the law or on a clearly erroneous assessment of the evidence.” Esmark Apparel

Co. v. James, 10 F.3d 1156, 1163 (5th Cir. 1994).

2. The District Court’s Denial of Class Certification of the

Displaced Class Was an Abuse of Discretion

The district court refused to certify the Displaced Class on the grounds that

(a) Plaintiffs had not satisfied the Rule 23(a)’s requirement that the class be so

numerous so as to make joinder impracticable and (b) that individual damages

issues predominated. The court erred in both respects.

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(a) Plaintiffs Satisfied the Numerosity Requirement And

Joinder Was Impracticable

The district court erred in finding Plaintiffs had not shown the class was so

numerous as to make joinder impractical because Plaintiffs presented evidence

estimating that the proposed Displaced Class consisted of at least 55 class

members [ROA.2673; ROA.2706], while the NFL admitted there were as many as

42 class members. [ROA.3638]

However, even accepting the NFL’s estimate that the Displaced Class

consisted of 42 class members as opposed to 55 (it did not), a presumption of

impracticability was still raised. “[A] class of 40 or more members raises a

presumption of impracticability of joinder based on numbers alone” and thus

satisfies the numerosity requirement. See Newberg on Class Actions §3:12 & n.9

(emphasis added); see also Mullen v. Treasure Chest Casino, LLC, 186 F.3d 620,

624 (5th Cir. 1999) (citing Newberg for presumption); Consol. Rail Corp. v. Town

of Hyde Park, 47 F.3d 473, 483 (2d Cir. 1995) (“[N]umerosity is presumed at a

level of 40 members”); Vega v. T–Mobile USA, Inc., 564 F.3d 1256, 1266–67

(11th Cir. 2009) (citation and quotation omitted) (“more than forty” is an adequate

class size). Accordingly, courts in this circuit and others have routinely concluded

that 40 or more class members satisfies numerosity. See, e.g., Jones v. Diamond,

519 F.2d 1090, 1100 n.18 (5th Cir. 1975) (numerosity satisfied by a class of 48

members).

In addition to the presumption that joinder was impracticable due to the class

size of at least 42 members, that fact that joinder was impracticable should have

been readily inferred from the record. See Mullen, 186 F.3d at 624-25 (in

analyzing numerosity element, explaining that “[n]otwithstanding the lack of any

direct evidence, the district court reasonably inferred from the nature of the

putative class members’ employment that some of them would be geographically

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dispersed.”) (emphasis added). For example, the case involves putative class

members from all across the country who traveled to Dallas for Super Bowl XLV.

Hauling all of those class members back to Dallas via joinder is unrealistic and

impractical - the geographic diversity of the putative class alone demonstrates

joinder was impracticable. Likewise, the impracticability of joinder should have

been inferred from the relatively low monetary sum that each putative class

member sought in compensatory damages for breach of contract as demonstrated

by the trial in this case. The parties engaged in a highly contentious trial in which

the monetary demand of the three Displaced plaintiffs (Ibe, Wanta, and Laffin) for

breach of contract totaled less than $30,000. To suggest that it is practicable for

the resources of the district court and the attorneys for the parties to be occupied by

at least 10-20 additional lengthy jury trials defies reason.

(b) Individual Issues on Damages Does Not Preclude

Class Certification

The district court also erred in concluding individual issues predominated

under Rule 23(b)(3). The district court held “individual damages issues

predominate over the one remaining common legal issue” held to exist by the

court, which was “whether the ticket terms require the NFL only to refund to

displaced ticketholders the face value of the ticket or whether such fans are entitled

to the full range of damages generally permitted under contract law.” [ROA.7237-

7238] That ruling was in error because even though the amount of each class

members damages may have varied, each class member suffered the same injury –

i.e. each class member was damaged because each paid for a ticket to the game but

was not given a seat to the game. See In re Deepwater Horizon, 739 F.3d 790,

810-11 (5th Cir. 2014) (“legal requirement that class members have all ‘suffered

the same injury’ can be satisfied by an instance of the defendant's injurious

conduct, even when the resulting injurious effects—the damages—are diverse.”)

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(emphasis added); Bell Atlantic Corp. v. AT&T Corp., 339 F.3d 294, 307 n. 17

(5th Cir. 2003)(“[D]ifferences among the members [of a class] as to the amount of

damages incurred does not mean that a class action would be inappropriate.”);

Newberg on Class Actions §4:54 (“courts in every circuit have uniformly held that

the 23(b)(3) predominance requirement is satisfied despite the need to make

individualized damage determinations.”).

Thus, even where damages are individualized, “[t]here are a number of

management tools available to a district court to address any individualized

damages issues that might arise in a class action[.]” In re Visa

Check/MasterMoney Antitrust Litigation, 280 F.3d 124, 141 (2nd Cir. 2001)

(citations omitted). These tools include: (1) bifurcating liability and damage trials

with the same or different juries, (2) appointing a magistrate judge or special

master to preside over individual damages proceedings; (3) decertifying the class

after the liability trial and providing notice to class members concerning how they

may proceed to prove damages; (4) creating subclasses; and/or (5) altering or

amending the class. Id. In addition, Rule 23(c)(4) gives the district court the

authority to certify a class “with respect to particular issues.”

Here, rather than adopt one of those tools, the court reasoned that “if the

Court resolved the common issues and held mini-trials on damages, the problem is

still the same: proof of damages will be required for every class member.”

[ROA.7248.] This reasoning was flawed. The identity of each Displaced Class

member was known by seat number and each class member suffered damage.

While individual determinations of the amount of damages might exist, the district

court erred in not using phased trials or other methods to simply address the

amount of damages for each class member.

Deepwater Horizon, a class action arising out of a large oil spill in the Gulf

of Mexico, is instructive in this regard. There, this Court upheld class certification

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notwithstanding concerns that individual damages considerations would

overwhelm class issues. 739 F.3d 815-16. The Court held that damages could be

left for later adjudication in a phased structure, explaining that “[t]he initial phases

of this litigation would therefore have focused on common questions, including

which defendants bore responsibility for the well blowout, how much oil escaped

from the Macondo reservoir, who bore responsibility for the inability of the

defendants to contain the flow earlier, where the oil finally came to rest, and how

the efforts to disperse the oil were conducted.” Id. at 816. Although the lower

court did not elaborate on how damages would be calculated if a settlement failed,

this Court found that such risk was outweighed by the benefits of trying related

claims together: “[t]he phased trial of common issues in this case would

undoubtedly prevent the repetitious re-litigation of these common issues by each

individual claimant in thousands of separate lawsuits.” Id. at 817. The Court

concluded that certification would “achieve economies of time, effort, and

expense, and promote . . . uniformity of decision as to persons similarly situated,

without sacrificing procedural fairness or bringing about other undesirable results.”

Id. (citing Amchem Products, Inc. v. Windsor, 521 U.S. 591, 615 (1997)); see also

Butler v. Sears, Roebuck & Co., 727 F.3d 796, 800 (7th Cir. 2013). This case is no

different and the district court erred in concluding otherwise.

3. The District Court’s Denial of Class Certification of the

Relocated Class Was an Abuse of Discretion

The court also erred in denying class certification of the Relocated Class.

The court recognized common issues of liability existed (such as whether the NFL

had an obligation to provide relocation seat of equal or higher quality and whether

the failure to do so was a breach of contract) but nonetheless denied class

certification on the grounds that individual issues of liability and damages

predominated.

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(a) The District Court’s Conclusion that Individual Issues

on Liability Predominated Over Common Issues

The court first erred in denying class certification on the grounds that

individual issues of liability predominated. In particular, the court concluded that

the NFL’s contention that it could only be liable to relocated fans if the fans

specifically chose their original seats would require an individual determination of

whether each class member picked a particular seat or purchased a ticket without

knowing their exact location in the stadium. That was in error because (1) whether

the NFL could only be liable to Relocated Class members if they chose their

original seats was itself a common question of liability; and (2) even if a class

member had not picked a particular seat at the time of purchase, once the NFL

provided each Relocated Class with a ticket for a specific seat, the NFL had no

unilateral right to move that class member to an inferior seat. In other words, the

NFL’s contention did not create an individual issue, and certainly not one that

predominated over the other common issues identified by the district court.

(b) Individual Issues on Damages Does Not Preclude

Class Certification

The court also denied class certification of the Relocated Class on the

grounds that individual issues of damages predominated because (1) each class

member would be required to individually prove the amount of his or her damages

and (2) each class member would be required to individually show that his or her

replacement seat was of “lesser quality.” As set forth above with respect to the

Displaced Class, the fact that class members may have suffered different amounts

of damage does not preclude class certification.

Likewise, the district court was wrong in holding that individual issues

predominated as a result of each class member allegedly needing to show his or her

seat was of “lesser quality.” To begin with, whether or not members of the

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Relocated Class received seats of “lesser quality” was not an individual issue as to

liability because by failing to provide class members their specific assigned seats

listed on their tickets, the NFL, per se, breached its contract. The only remaining

issue of whether the replacement seats were “inferior” would be one of damages.

Yet, even if each class member had to prove “inferiority,” common issues

would still predominate because there are objective criteria to determine whether

putative class members received worse seats. Here, members of the Relocated

Subclass acquired tickets for sections 205A, 215A, 230A, and 240A. Therefore, it

is obvious that those class members who got moved to one of the seats in the “300”

or “400” levels—both of which are higher in the stadium from their original

seats—received worse or lesser quality seats. In fact, according to the NFL’s

interrogatory responses, an estimated 297 individuals in the Relocated Subclass fall

within this category. [ROA3139-3143 at 17.]

Similarly, to determine whether class members who were relocated outside

the “300” or “400” levels received lesser quality seats, other objective criteria may

be employed, including, (1) yard-line position, (2) actual sales price based on NFL

sales data [ROA.4500-4519; ROA.4521-4537], and (3) face value. Indeed, the

NFL itself routinely made reference to certain seats within the stadium being

“better” or “worse” than others. [ROA.4462] There is no reason why this same

methodology could not have been adapted here.

4. The District Court’s Denial of Class Certification of the

Obstructed View Class Was an Abuse of Discretion

The court likewise erred in denying class certification for the Obstructed

View Class.

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(a) The District Court Erred In Holding Individual Issues

Predominated on the Obstructed View Class’ Breach

of Contract Claim

The court erred in refusing to certify a breach of contract claim for the

Obstructed View Class. The district court found Plaintiffs met the Rule 23(a)

prerequisites, but nonetheless held individual issues predominated. The court

divided its analysis by those members of the class who had an obstructed view of

the field and those that had an obstructed view of the Video Board.

As to those with an obstructed view of the field, the district court held “an

individualized inquiry to determine the extent of the obstruction is necessary for

purposes of gauging the materiality of the breach and the amount of damages.”

[ROA.7256] This was erroneous as common evidence showed that any obstructed

view of the field was material. For example, when the NFL sold tickets marked

“Restricted View,” these tickets did not contain disclosures describing the

obstructions. In other words, they did not say “Restricted View-Pillar,” “Restricted

View-Overhang,” etc. They simply stated “Restricted View.” In fact, the NFL

knew the “Restricted View” seats would have disparate views, yet made no attempt

to describe those views to prospective purchasers or differentiate their pricing

based on quality of the views. [ROA.2907; ROA.4462; ROA.4477; ROA.5794-

5795] Therefore, the fact that the degree or extent of the obstructions differed

between putative class members did not create individual issues. Whether a

person’s view was 10 percent, 50 percent, or 99 percent obstructed, the NFL

routinely treated such tickets as one and the same by simply marking them

“Restricted View” and reducing their face value across-the-board to $600. Beyond

that, methods were available to ascertain the extent of the obstructions using

common evidence. For example, Plaintiffs presented evidence of photographs,

spreadsheets, and other materials produced by the NFL showing which specific

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seats were obstructed and how. Additionally, Plaintiffs pointed to evidence

showing that Populous and Seating Solutions, the two companies the NFL relied

upon with respect to temporary seating, admitted that they both used sightline

projections and analysis to determine which seats would have obstructed views—

before any temporary seat had actually been installed in the stadium. [ROA.5769-

5770; ROA.5820-5821] Thus even if the extent of the obstruction was an

individual issue (1) it could be proven by common evidence and (2) it did not

predominate over other common issues like whether the NFL had an obligation to

mark obstructed view seats as “Restricted View”.

With respect to those class members with an obstructed view of the field, the

court also held that individual issues as the amount of their damages predominated.

That was in error for the same reasons it was in error with respect to the Displaced

and Relocated Classes.

Regarding Obstructed View class members who had an obstructed view of

the Video Board, the district court recognized a common issue existed regarding

whether it is a breach of contract to provide to a ticketholder whose seat was not

marked “Restricted View” a seat with obstructed view of the Video Board. The

court nonetheless held the extent of the obstruction and damages were individual

issues that predominated. That was erroneous for the same reasons that the extent

of the obstruction and the amount of damages are not sufficient to preclude class

certification of those with obstructed views of the field.

(b) The District Court Erred In Holding Individual Issues

Predominated on the Obstructed View Class’

Fraudulent Inducement Claim

The district court also erred in denying certification of the Obstructed View

class’ fraudulent inducement claim, which was based on the NFL’s failure to

disclose the ticket was for an obstructed view seat. The court realized “questions

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over whether the NFL had a duty to disclose any obstructed views of the field or

the Video Replay Board are common to the entire class” but nonetheless held

reliance was an “individual issue precluding class certification.” In so ruling, the

district court erred and ignored the holding in Affiliated Ute Citizens v. United

States, 406 U.S. 128, 153-154 (1972), and other cases establishing a presumption

of reliance based on the materiality of the information (which, as noted above,

could be proven by classwide evidence that any obstructed view is material).

“[W]here a plaintiff alleges deception by defendant’s nondisclosure of

material information,” there is a presumption that “obviates the need for plaintiff to

prove actual reliance on the omitted information.” Rifkin v. Crow, 574 F.2d 256,

262 (5th Cir. 1978). This presumption of reliance in fraudulent non-disclosure

cases was established by the U.S. Supreme Court in Affiliated Ute Citizens. Thus,

in cases “involving primarily a failure to disclose, positive proof of reliance is not a

prerequisite to recovery. All that is necessary is that the facts withheld be material

in the sense that a reasonable investor might have considered them important in the

making of this decision.” Id. (emphasis added). Further, “where a party had no

opportunity to learn the truth, a presumption of reliance is warranted to a greater

degree than where there is a misrepresentation.” In re Great Southern Life Ins. Co.

Sales Practices Litig., 192 F.R.D. 212, 220 (N.D. Tex. 2000).

The present case fits squarely within the framework of Ute and its progeny.

Like those cases, (1) putative class members have a standardized contract with the

NFL in the form of the tickets they held for seats at the Super Bowl, (2) this is a

fraud case based solely on the omission of a material fact, and (3) the information

being withheld—the existence of obstructed views—is material because it is

information that “a reasonable person would attach importance to and would be

induced to act on in determining his choice of actions in the transaction in

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question.” Citizens Nat’l Bank v. Allen Rae Investments, Inc., 142 S.W.3d 459,

478-479 (Tex. 2004).

Additionally, the district court held the individual issues of damages on the

fraudulent inducement claim predominated, but as set forth above, that was in error

because differences in the amount of class members’ damages are not sufficient to

preclude class certification. Moreover, with respect to the Obstructed View Class,

the court ignored Plaintiffs’ proposal for a simplified damage model awarding a 33

percent refund of the cost of the ticket. This is based on evidence of how the NFL

priced obstructed view seats marked “Restricted View.” Specifically, the NFL sold

1,458 tickets in the “Silver Level” of the stadium that were marked as “Restricted

View” [ROA.3731 at ¶4] The face value of these tickets was $600. [ROA.4462]

Seats within the Silver Level that were not marked with “Restricted View” had a

face value of $900. [ROA.2790] Therefore, according to the NFL’s own

calculations, the value of obstructed view seats is at least 33 percent less than seats

with no obstructed views. By adopting this simple refund model for damages, the

district court could have avoided any individual issues on damages.

B. The District Court’s Order Granting Summary Judgment Was In

Error.

1. Standard of Review

This Court reviews a district court’s award of summary judgment de novo.

Minter v. Great Am. Ins. Co., 423 F.3d 460, 464-65 (5th Cir. 2005). In assessing a

motion for summary judgment, the court “must review the record taken as a

whole,” and “must draw all reasonable inferences in favor of the nonmoving

party.” Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 143 (2000)

(internal quotation marks omitted).

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2. Summary Judgment Was Improper On The Breach of

Contract Claim Based On the NFL Failing to Provide

Unobstructed Views of the Video Board

The district court erred in granting summary judgment to the NFL on

Plaintiffs Fortune and Hoffman claims for breach of contract based on the NFL

failing to provide them with seats that had an unobstructed view of the Video

Board (and not disclosing the obstruction on the ticket). The court realized that

failing to provide a ticketholder with an unobstructed view of the playing field

would be a breach of contract, but nonetheless held as a matter of law that failing

to provide that same ticketholder with an unobstructed view of the Video Board

could not be a breach of contract.

This issue before the district court turned on whether, as a matter of law, the

phrase “entry in the stadium and a spectator seat for the game” in the ticket

contract meant the ticketholder had no right to an unobstructed view of the Video

Board or whether the phrase was, at a minimum, ambiguous such that extrinsic

evidence needed to be considered by a finder of fact in order to determine whether

the ticket contract granted the ticketholder a right to an unobstructed view of the

Video Board. The court erred in holding that, as a matter of law, the phrase did not

grant the ticketholder a right to an unobstructed view of the Video Board. That is

the case for at least the following reasons.

First, the language “spectator seat for the game” cannot “be given a definite

or certain legal meaning” as is required to resolve its interpretation as a matter of

law. Dell Computer Corp. v. Rodriguez, 390 F.3d 377, 388 (5th Cir. 2004)

(emphasis added). It is well known that at Cowboys’ Stadium, the Video Board is

very much part of the action that is taking place on the field and, therefore, is an

unmistakable part of viewing experience at the “game.” The Video Board, in fact,

displayed the action on the field in “real-time” and was promoted as part of the

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“game”. For example, in an interview with USA Today, Jerry Jones admitted that

the action on the field is simultaneously displayed—with not even a “nano-second”

of delay—on the enormous video screens that hang above the center of the field

and are purportedly visible no matter where one sits in the stadium. [ROA.9618]

Indeed, according to the NFL, the Video Board was “part of the big draw of their

stadium.” [ROA.9635] Moreover, the ability to view instant replay—which was

also displayed on the Video Board—is a critical and fundamental part of every

present day NFL in-stadium game experience. All of this is consistent with the law

that a ticket for a spectator seat “is in the nature of a permit to enter a place of

amusement and to use such accommodations as are provided for the enjoyment of

the entertainment offered.” Jordan v. Concho Theatres, 160 S.W.2d 275, 276 (Tex.

Civ. App. 1941) (emphasis added).3

However, instead of choosing precise language such as “spectator seat for

the playing field” or “spectator seat for the game on the playing field” to ensure

fans were not misled by the promotion of the Video Board and to make clear that

fans had no contractual right to a view of the Video Board screens or replays, the

NFL chose the broader language “spectator seat for the game.” [ROA.10162]

Indeed, the NFL’s own later choice of words during discovery and trial in

describing what it believed it was required to give the fans provided a strong

indication that the phrase “spectator seat for the game” was ambiguous, at best.

According to the NFL’s witnesses—including Frank Supovitz who approved the

content and language of the Super Bowl XLV tickets—the NFL was required to

provide ticketholders only with an unobstructed view of the “playing field” from

sideline to sideline and endline to endline. [ROA.9599; ROA.9613; ROA.9618]

3 Jordan is the case the court itself cited to define the nature of the Super Bowl tickets at issue in this litigation. [ROA.10780 at fn. 68.] The court then ignored the case as it applied to the Video Board obstructions.

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Indeed, the NFL’s witnesses carefully chose the term “playing field” as opposed to

“game” during discovery and trial. Presumably, they did so in order to remove the

clear ambiguity from their definition. For these reasons at a minimum, the term

“game” as used in the tickets was “reasonably susceptible to more than one

interpretation” and thus ambiguous. The court should have denied summary

judgment and allowed the jury to resolve the ambiguity. See, e.g., Amigo Broad.,

LP v. Spanish Broad. Sys., Inc., 521 F.3d 472, 488-489 (5th Cir. 2008) (holding

the term “name” in a licensing provision of employment agreement between a

radio station and its on-air personalities was ambiguous); Dell Computer Corp. v.

Rodriguez, 390 F.3d at 389 (where contract “is susceptible of either reading, both

of which are reasonable” that is “the very definition of ambiguity.”).

Second, the district court’s order was also erroneous because the court

ignored evidence of the “surrounding circumstances,” the “subject matter of the

contract,” and “prior negotiations and all other relevant incidents bearing on the

intent of the parties” demonstrating the language on the tickets were ambiguous.

“[A]ppellate courts may examine extrinsic evidence of ‘surrounding circumstances'

or ‘the subject matter of the contract’ to determine if a latent ambiguity exists.”

Dell, 390 F.3d at 389 n.24 (emphasis added). Here, the extrinsic evidence

presented to the district court established that the NFL believed ticketholders were

entitled to have an unobstructed view of the Video Board. For example:

NFL Commissioner Goodell confirmed that seats that fail to provide

unobstructed views of the “stadium” are obstructed view seats. [ROA.9743]

It was a requirement of the temporary seating project for the contractor to

install seats that provided sightlines to the Video Board. [ROA.9912-9913;

ROA.9916-9918; ROA.9920; ROA.9923; ROA.9966; ROA.9983-9998]

In internal communications, NFL officials along with their consultants

routinely referred to seats with trouble seeing the Video Board as

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“obstructed view” seats. [ROA.9850-9851; ROA.9959-9961; ROA.9975-

9976; ROA.9978]

The NFL and its consultants claimed they went to great lengths to identify

which seats had obstructed views of the Video Board before the game.

[ROA.9858-9859; ROA.9946-9947]

The NFL and Populous directed the seating contractor to remove certain

seats solely because they did not furnish unobstructed views of the Video

Board. [ROA.9845; ROA.9847-9850; ROA.9852-9853; ROA.9957;

ROA.9959-9961; ROA.9968-9969; ROA.9970-9972]

Third and finally, the silence of the ticket contracts with regards to specific

references to the playing field and the Video Board also creates an ambiguity. See,

e.g., Hewlett-Packard v. Benchmark, 142 S.W.3d 554, 561 (Tex. App.

2004). There are numerous benefits that are left out of the ticket contracts, but

over which there can be no dispute that fans are entitled to receive as part of their

tickets. For example, the ticket contracts make no reference to access to restrooms,

to food and concession stands, ability to watch the Super Bowl halftime show,

ability to hear or see the game, and many other aspects fundamental to attending

the Super Bowl. Similarly, the ability to view the playing field and the Video

Board need not be spelled out in the contract. Thus, the silence of the ticket

contracts regarding the Video Board at the very minimum establishes an ambiguity

that cannot be resolved on summary judgment.

3. The District Court Erred In Granting Summary Judgment

On Fraud Claims For Failure to Disclose Obstructed Views

of the Video Board

In addition to granting summary judgment to the NFL on Plaintiffs Fortune

and Hoffman’s breach of contract claims for obstructed view seats of the Video

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Board, the court also erroneously dismissed Fortune and Hoffman’s fraudulent

inducement claims relating to the Video Board, stating as follows:

[T]he Court finds the NFL had no contractual obligation

to provide seats with a view of the video board. Because

Plaintiffs point to no evidence outside the ticket terms

that imposes a duty on the NFL to disclose that a view of

the video board was obstructed, the Court holds that their

fraudulent inducement claims relating to the video board

fail as a matter of law.

[ROA.10789] The court’s ruling was in error for several reasons.

First, for the reasons stated above, there was a triable issue as to whether the

NFL had a contractual obligation to provide seats with a view of the Video Board.

Second, the district court’s ruling was factually erroneous. The court

dismissed Fortune and Hoffman’s fraudulent inducement claim relating to the

Video Board “as a matter of law” because Plaintiffs purportedly “point[ed] to no

evidence outside the ticket terms that imposes a duty on the NFL to disclose that a

view of the video board was obstructed[.]” [ROA.10789] To the contrary,

Plaintiffs presented voluminous evidence creating a genuine issue of material fact

on their fraudulent inducement claim relating to the Video Board. See Section

V(B), supra. “A duty to speak arises by operation of law when . . . one party

knows that the other party is relying on a concealed fact, provided that the

concealing party also knows that the relying party is ignorant of the concealed fact

and does not have an equal opportunity to discover the truth.” Union Pac. Res.

Grp., Inc. v. Rhone-Poulenc, Inc., 247 F.3d 574, 586 (5th Cir. 2001). In addition,

“a duty to disclose may arise, among other circumstances, ‘when one makes a

partial disclosure and conveys a false impression.’” See Rio Grande Royalty Co.,

Inc. v. Energy Transfer P’ners, L.P., 620 F.3d 465, 468 (5th Cir. 2010). A duty to

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speak also arises between non-fiduciaries “when ‘one party learns later that his

previous affirmative statement was false or misleading.’” Shandong Yinguang

Chem. Indus. Joint Stock Co. v. Potter, 607 F.3d 1029, 1035 (5th Cir. 2010)

(quoting Rhone-Poulenc, Inc., 247 F.3d at 586 & n.33).

Here, as set forth above, Plaintiffs presented evidence that (i) the NFL knew

Fortune and Hoffman did not know that their seats would not have views of the

Video Board, and (ii) Fortune and Hoffman did not have an equal opportunity to

discover that fact. [ROA.9858-9859; ROA.9946-9947; ROA.9959-9961]

Likewise, Plaintiffs presented evidence the NFL knew that selling tickets to

Fortune and Hoffman listing assigned seats with no disclosure that they would not

be able to see the Video Board was “a partial disclosure” that “convey[ed] a false

impression.” See Rio Grande Royalty, 620 F.3d at 468. [ROA.9743:11-9744:14;

ROA.9851; ROA.10012-10013; ROA.9946-9947; ROA.9858-9859;

ROA.16521:3-18; ROA.9860; ROA.10057-10058; ROA.9841; ROA.9860;

ROA.9863; ROA.11746-11747] Plaintiffs also presented evidence that the NFL

learned its “previous affirmative statement[s]” on the tickets suggesting there were

no obstructed views were “false or misleading” when it re-discovered that Fortune

and Hoffman’s seats did not have appropriate views of the Video Board. See

Shandong, 607 F.3d at 1035. [ROA.9860; ROA.10057-10058; ROA.9841;

ROA.9860; ROA.9863; ROA.11746-11747; ROA.9959-9961] Therefore, the

court’s order granting summary judgment was error.

C. The District Court’s Charge to the Jury on Plaintiffs Fortune and

Hoffman’s Fraudulent Inducement Claim Was Error.

1. Standard of Review

The district court’s instructions to the jury are reviewed for abuse of

discretion. See Le Boeuf v. K-Mart Corp., 888 F.2d 330, 334 (5th Cir.1989).

Nevertheless, a court must “instruct the jurors, fully and correctly, on the

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applicable law of the case, and . . . guide, direct, and assist them toward an

intelligent understanding of the legal and factual issues involved in their search for

truth.” Bender v. Brumley, 1 F.3d 271, 276 (5th Cir. 1993).

2. The District Court Should Have Instructed the Jury on

Fraud Based on Non-Disclosure

The court erroneously denied Plaintiffs’ Proposed Jury Instruction No. 18, in

which Plaintiffs asked for an instruction on fraud through a failure to disclose

obstructed views of the playing field, including failure to disclose information the

NFL allegedly learned after they placed the tickets into the stream of commerce.

[ROA.11367; ROA.14791; ROA.17447:10-14; ROA.17448:17-23] The court’s

failure to instruct the jury on fraud by non-disclosure was an abuse of discretion

and warrants a new trial.

In addition to the circumstances set forth above, a duty to speak also arises

between non-fiduciaries “when ‘one party learns later that his previous affirmative

statement was false or misleading.’” Shandong, 607 F.3d at 1035 (quoting Rhone-

Poulenc, 247 F.3d at 586). Here, Plaintiffs’ proposed jury charge on fraud through

a failure to disclose tracked this well-established law in Texas, and, in fact, was

based on Texas Pattern Jury Charge 105.4. By refusing to give this instruction, the

district court prevented the jury from considering whether the NFL committed

fraud by failing to disclose material facts to Plaintiffs Fortune and Hoffman

concerning the obstructed view of the playing field from their seats.

Specifically, Plaintiffs presented evidence at trial that despite selling tickets

to Fortune and Hoffman that had no indication of any obstructed or restricted view,

the NFL, at a minimum, acquired new information well before the game that made

its earlier information misleading or untrue and which conveyed a false impression

and thus subjected the NFL to liability. [ROA.9844-9845; ROA.9847-9848;

ROA.9851-9852; ROA.9855-9856; ROA.9632; ROA.9946-9947; ROA.7468;

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ROA.9978; ROA.10268; ROA.15867:16-15869; ROA:17091:19-17092:16; Trial

Ex. 552; ROA.17093:12-14; ROA:17092:23-17093:3; Trial Ex. 554;

ROA.17087.15-17089:5; ROA.17085:4-11; ROA.17090:24-17091:4;

ROA.16441:23-16442:16; ROA.16153:4-6; Trial Exhibit 182; ROA.16555:19-

16556:5; ROA.16582:16-16583:14; ROA.16580:16-16581:20; ROA.16571:21-

16572:5; Trial Exhibit 119; ROA.15755:20-15756:2; ROA.15867:3-8;

ROA.16065:1-4; ROA.16060:14-16061:11; ROA.15911:19-15913:3;

ROA.15909:20-15911:25]

Moreover, the fact that the NFL acquired information suggesting there

would be sightline problems with Fortune and Hoffman’s seats after January 11,

2011, the date the NFL “distributed” the tickets to the teams, does not relieve it of

having committed fraud by omission. The law is clear that a fraud claim may be

based on misrepresentations and omissions occurring after the execution of a

contract between the parties, including new information the seller learns of after

the sale. See Texas Pattern Jury Charges 105.4; see also Anderson, Greenwood &

Co. v. Martin, 44 S.W.3d 200, 212-13 (Tex. App. 2001) (“when one makes a

representation, he has a duty to disclose new information when he is aware the new

information makes the earlier representation misleading or untrue”); Kajima Int’l

v. Formosa Plastics Corp., 15 S.W.3d 289, 292-294 (Tex. App. 2000) (trial court’s

instruction inadequate because it “precluded consideration of any fraud occurring

after the execution” of the contract.); Regus Management Group, LLC v.

International Business Machine Corp., No. 3:07-CV-1799-B, 2008 WL 1836360,

at *7 (N.D. Tex. Apr. 24, 2008); Nat'l Ctr. for Policy Analysis v. Fiscal Assocs.,

No. CIV.A. 97CV2660L, 2002 WL 433038, at *5-6 (N.D. Tex. Mar. 15, 2002);

Experian Info. Solutions, Inc. v. Lexington Allen L.P., No. 4:10-CV-144, 2011

WL 1627115, at *3, 8-12 (E.D. Tex. Apr. 7, 2011) report and recommendation

adopted, No. 4:10-CV-144, 2011 WL 1637935 (E.D. Tex. Apr. 28, 2011).

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3. The Decision Striking Punitive Damages Was Error

Plaintiffs also appeal the district court’s order granting a directed verdict on

Plaintiffs’ punitive damages claim stemming from the fraud claim related to

obstructed views of the Video Board. Fraud may give rise to punitive damages.

Accordingly, by submitting the fraud claim to the jury, the district court inherently

recognized that evidence of fraud was presented at trial. Thus, it was error for the

district court to act as a fact finder, weigh that evidence and determine as a matter

of law that the evidence would be insufficient to support a punitive damages award.

This determination should have been left to the jury and the court’s usurpation of

the jury’s province was improper.

D. The District Court’s Dismissal of Plaintiffs’ Fraud and DTPA

Claims at the Pleading Stage Was Error.

1. Standard of Review

This Court reviews the district court’s dismissal under Rule 12(b)(6) de

novo, taking the allegations of the complaint to be true. Vander Zee v. Reno, 73

F.3d 1365, 1368 (5th Cir. 1996).

2. The District Court’s Dismissal of the Cowboys Defendants

Was Error

(a) Plaintiffs Sufficiently Alleged That the Cowboys

Defendants Were Parties to the Ticket Contract

The court also erred when it granted the Cowboys Defendants’ motion to

dismiss all of the claims asserted against them in the First Amended Complaint

without leave to amend. This decision should be reversed for multiple reasons.

First, Plaintiffs sufficiently alleged a breach of contract claim against the

Cowboys Defendants. Specifically, Plaintiffs alleged that the Super Bowl XLV

tickets at issue had been sold to the Plaintiffs by the NFL and the Cowboys

Defendants; that the Cowboys Defendants received five percent (5%) percent of the

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tickets to resell to the fans; and that some of these tickets had been purchased by

Plaintiffs. [ROA.815 at ¶4.13.] Plaintiffs even went so far as to attach to the

complaint invoices listing “Cowboys Stadium, L.P.” as the seller and requiring

payment be made out to “Dallas Cowboys.” [ROA.853] Plaintiffs alleged that

payments went into the Cowboys Defendants’ accounts, with credit card

disbursements paid to the “Dallas Cowboys.” [ROA.815 at ¶4.13.] Moreover,

Plaintiffs alleged the Cowboys Defendants sent the Super Bowl tickets to

purchasers by Federal Express. [ROA.815]

These allegations give rise to more than a plausible inference that one or

more of the Cowboys Defendants were parties to the ticket contracts by virtue of

their sale of tickets to Super Bowl XLV. See Talen's Landing, Inc. v. M/V

Venture, II, 656 F.2d 1157, 1160 (5th Cir. 1981) (affirming district court finding

that meter tickets and invoices reflecting sales together constituted a contract

between the parties); Hawkins v. Frick-Reid Supply Corp., 154 F.2d 88, 88 (5th

Cir. 1946) (holding invoice was contract of the parties); Chesapeake Operating,

Inc. v. Whitehead, No. CIV.A. C-10-301, 2011 WL 4372486, at *5 (S.D. Tex.

Sept. 19, 2011) (finding that invoices constituted contracts). The district court

erred by determining as a matter of law at the pleading stage that these allegations

could not support the existence of a contract.

Second, the Cowboys and the NFL were agents of one another and Plaintiffs

accordingly were free to sue either or both of them for breach of contract. “It is a

settled rule of law that an agent may make a contract for an undisclosed principal in

his own name, and that the latter may sue or be sued on the contract.” Latch v.

Gratty, Inc., 107 S.W.3d 543, 546 (Tex. 2003) (citing First Nat’l Bank of Wichita

Falls v. Fite, 131 Tex. 523, 115 S.W.2d 1105, 1109–10 (1938)). In fact, in

discovery following dismissal of the Cowboys Defendants and at trial, the evidence

showed the NFL and Cowboys organization entered into an agreement imposing a

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contractual obligation on the Cowboys to timely construct the temporary seats for

Super Bowl XLV. [ROA.17373:20-23] The Cowboys assumed responsibility to

complete the temporary seats based on a provision entitled “Temporary Seat

Installation.” This provision stated, in part, that the “Licensor [i.e. Cowboys

Stadium, L.P.] must coordinate all scheduling for seat installation with NFL. As

such, Licensor acknowledges and agrees that NFL may determine if Licensor’s

installation of seats will unreasonably interfere with other NFL functions. Such

seating must be installed by January 30, 2011 with all work fully complete,

approved and ready for occupancy by such date.” [Trial Ex. 119 (emphasis

added).]

According to the NFL, this provision governed the installation of temporary

seats and required Cowboys Stadium, L.P. to install the temporary seats by January

30, 2011. [ROA.15755.20-15756:2] Jack Hill, the Stadium General Manager for

the Cowboys at the time of the Super Bowl XLV, readily admitted the Cowboys’

organization was responsible for completing the temporary seating project.

[ROA.17122:11-18] Further, that the Cowboys had responsibility to the fans to

complete the temporary seats is consistent with Jerry Jones’ written “apology” to

fans. [ROA.825 at ¶4.47]

Therefore, the court’s dismissal of the contract claim against the Cowboys

Defendants at the pleading stage was error.

(b) Plaintiffs May Maintain Tort Claims Against the

Cowboys Defendants Related to the Ticket Sales.

If the Cowboys Defendants were parties to the ticket contract, then Plaintiffs

also may maintain fraud and DTPA claims against the Cowboys Defendants,

consistent with the district court’s findings as to fraud claims which it held were

alleged against the NFL and consistent with other fraud claims against the NFL that

the district court improperly dismissed, as set forth above. In fact, the district

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court’s only grounds for dismissing the fraudulent inducement claims against the

Cowboys Defendants was that the district court found (erroneously) that the

Cowboys were not a party to the ticket contracts. [ROA.1126] Accordingly, if the

court’s dismissal of the contract claim was in error, then its dismissal of the

fraudulent inducement claim was necessarily also erroneous and should be

reversed. Further, if this Court concludes any other claims were dismissed in error,

such claims should also be reinstituted against the Cowboys Defendants.

3. The District Court Erred In Granting The NFL’s 12(b)(6)

Motion Dismissing the Fraudulent Inducement Claims of

the Displaced and Relocated Plaintiffs

The district court erred in granting a Rule 12(b)(6) motion by the NFL

related to the fraudulent inducement claims of the Displaced and Relocated

Plaintiffs (Ibe, Wanta, Laffin, and Burgwin). The court granted the motion in part,

on the grounds that “Plaintiffs’ allegations as to the availability of the temporary

seats do not support a plausible inference of fraudulent inducement.” [ROA.1125]

The district court reasoned that “[w]ithout alleging facts supporting the allegation

that Defendants did not intend to construct the temporary seats for which tickets

were sold, Plaintiffs cannot recover on a theory of fraudulent inducement as to

temporary seats that were not completed and approved by game day.” [ROA.1125]

The court also determined, without any evidence, that “[t]he NFL had nothing to

gain by tricking fans into purchasing tickets that it did not plan on having

available.” [ROA.1125] How the district court knew this to be true is unclear.

The court’s dismissal ruling was erroneous for at least three reasons.

First, Plaintiffs were not required to allege that Defendants had a specific

intent not to perform the ticket contracts. The reason is that a statement is

fraudulent not only when the maker knew it was false, but also when he or she

“made it recklessly without any knowledge of its truth and as a positive assertion.”

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Custom Leasing, Inc. v. Texas Bank & Trust Co., 516 S.W.2d 138, 143 (Tex.

1974) (emphasis added). “A representation is reckless: (1) if it is made without

any knowledge of the truth and as a positive assertion; (2) if the person making the

representation knows that she does not have sufficient information or basis to

support it; or (3) if she realizes that she does not know whether or not the statement

is true.” Livingston Livestock Exch., Inc. v. Hull State Bank, 14 S.W.3d 849, 852

(Tex. App. 2000) (citing Johnson & Higgins of Texas, Inc. v. Kenneco Energy,

Inc., 962 S.W.2d 507, 527 (Tex. 1998)). Here, even if the allegation of specific

intent was implausible (it was not), the allegation of recklessness was plausible,

thus requiring denial of the motion. [ROA.834-835 at ¶7.5.]

Second, Plaintiffs’ allegation of specific intent to defraud was not

implausible. Public statements of Jerry Jones, NFL officials, and others speaking

on behalf of Defendants, as pled in the operative complaint, give rise to a plausible

inference they defrauded fans in order to break the Super Bowl attendance record.

[ROA.811 at 4.6; ROA.813 at 4.10; ROA.814 at 4.11; ROA.817 at 4.24; ROA 818

at 4.26, 4.27; ROA.819 at 4.29; ROA.826 at 4.52] Plaintiffs also alleged facts

showing Defendants wanted to maximize profits, which likewise makes the

allegation of fraudulent intent plausible. [ROA.809 at 4.2; ROA.826 at 4.6.]

Finally, Plaintiffs alleged facts showing Defendants wanted to avoid a public

relations debacle before the game, which again supports the allegation. [ROA.824

at 4.45; ROA.825 at 4.49] Plaintiffs presented evidence corroborating these

allegations at trial. [ROA.16293:24-16295.24]

Third, the law does not require a plaintiff to plead fraudulent intent with

specificity. See Fed. R. Civ. P. 9(b) (“[m]alice, intent, knowledge, and other

conditions of a person’s mind may be alleged generally.”).

Accordingly, the court erred when it held Plaintiffs had not plausibly alleged

fraudulent intent. “Intent is a fact question uniquely within the realm of the trier of

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fact because it so depends upon the credibility of the witnesses and the weight to be

given to their testimony.” Coffell v. Stryker Corp., 284 F.3d 625, 634 (5th Cir.

2002) (quoting Spoljaric v. Percival Tours, Inc., 708 S.W.2d 432, 434 (Tex. 1986)).

A second stated basis upon which the district court dismissed the fraud

claims of the Displaced Class and Relocated Class was that “Plaintiffs do not

allege that tickets were sold to Plaintiffs after Defendants knew that the seats

would not be completed.” [ROA.1125] This was error. As discussed above,

whether Defendants’ knowledge of material facts that they were required to

disclose to Plaintiffs arose before or after the sale of tickets is irrelevant because a

fraud claim may be based on misrepresentations and omissions occurring after the

execution of a contract between the parties, including information the seller

learned after the contract was entered into. Defendants, therefore, had an ongoing

duty to disclose information they acquired after selling the tickets to Plaintiffs that

rendered Defendants’ earlier representations untrue, misleading, or deceptive. See,

e.g., Rio Grande, 620 F.3d at 468; Rimade, Ltd. v. Hubbard Enterprises, Inc., 388

F.3d 138, 143 (5th Cir. 2004); Anderson, 44 S.W.3d at 212-13; Citizens National

Bank, 142 S.W.3d at 476-77.

4. The District Court’s Conclusion that the Economic Loss

Rule Barred All of Plaintiffs’ Fraudulent Concealment and

Negligent Misrepresentation Claims Was Error

On Defendants’ motion to dismiss Plaintiffs’ tort claims in the First

Amended Complaint, the district court ruled that all of Plaintiffs’ fraudulent

concealment and negligent misrepresentation claims were barred by the economic

loss rule, also known as the independent injury rule. [ROA.1122-1123] That was

error for the following three reasons.

First, Plaintiffs’ fraudulent concealment and negligent misrepresentation

claims fell within the well-recognized exception to the economic loss rule

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discussed in Formosa Plastics Corp., USA v. Presidio Eng’gs & Contr., Inc., 960

S.W.2d 41 (Tex. 1998). There, the Texas Supreme Court held “that the legal duty

not to fraudulently procure a contract is separate and independent from the duties

established by the contract itself” and thus the economic loss rule does not apply.

Id. at 46. In the instant case, Plaintiffs alleged that on the basis of Defendants’

fraudulent and negligent misrepresentations, Plaintiffs were “induced to . . .

purchase tickets, make travel plans and other arrangements to attend Super Bowl

XLV, and make necessary arrangements to take time off from work in order to

attend Super Bowl XLV.” [ROA.835 at 7.6-7.7; ROA.840 at 9.5.] Consequently,

because all of the fraud and negligent misrepresentations claims fell under the

category of fraudulent inducement, they were not subject to the economic loss rule.

Second, Plaintiffs’ tort claims based on concealment of material facts were

premised on duties that are separate and independent from any duties created by

contract. Here, Defendants not only had a duty to perform the ticket contracts, they

also had a duty not to conceal material facts from Plaintiffs. See Cardinal Health

Solutions, Inc. v. Valley Baptist Med. Ctr., No. CIV. A. 1:07-CV-111, 2009 WL

150942, at *19 (S.D. Tex. Jan. 21, 2009) (fraud claim for knowingly

misrepresenting charges in invoices not barred by economic loss rule because

“[t]he duty to refrain from knowingly misrepresenting information in the manner

alleged by Defendants is a duty imposed by common law, independent of the duties

the Agreements create.”); Eastman Chemical Co. v. Niro, Inc., 80 F.Supp.2d 712,

717 (S.D. Tex. 2000) (even though the plaintiff’s claim arose out of the parties’

agreement, the defendant “had an independent legal duty not to commit the

intentional tort of fraud”).

Third, fraud and negligent misrepresentation claims based on concealment or

omission of material facts are not subject to the economic loss rule. See Experian

Info. Solutions, Inc. v. Lexington Allen L.P., No. 4:10-CV-144, 2011 WL

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1627115, at *12 (E.D. Tex. Apr. 7, 2011) report and recommendation adopted, No.

4:10-CV-144, 2011 WL 1637935 (E.D. Tex. Apr. 28, 2011) (“[t]he economic loss

rule does not apply to fraud claims, including claims for fraud in the performance

and fraudulent omission.”); Regus Management Group, LLC v. International

Business Machine Corp., No. 3:07-CV-1799-B, 2008 WL 1836360, at *6-7 (N.D.

Tex. Apr. 24, 2008) (economic loss rule did not bar claims of fraudulent omissions

after execution of parties’ agreement); Nazareth Int’l, Inc. v. J.C. Penney Corp.,

No. CIV.A. 304CV1265M, 2005 WL 1704793, at *8 (N.D. Tex. July 19, 2005)

(holding negligent misrepresentation claim based in part on failure to correct prior

statement not barred by economic loss rule).

5. The District Court’s Dismissal of Plaintiffs’ DTPA Claims

Based on Fraud Was Error

The court also erroneously dismissed “Plaintiffs other DTPA claims,” which

included Plaintiffs’ DTPA claims based on Defendants’ fraudulent concealment

[ROA.1127-1128; ROA.844 at 11.5] That ruling was erroneous for the same

reasons stated above as to why the court erred in dismissing (i) the Displaced and

Relocated Plaintiffs’ fraudulent inducement claims and (ii) all of Plaintiffs’

fraudulent concealment and negligent misrepresentation claims.

VII. CONCLUSION

For the foregoing reasons, the rulings below should be reversed, and this

case should be remanded for a new trial consistent with the findings of this Court.

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Dated: August 21, 2015

By: s/ Christopher S. Ayres Christopher S. Ayres Texas Bar No. 24036167 R. Jack Ayres, Jr. Texas Bar No. 01473000 AYRES LAW OFFICE, P.C. 4350 Beltway Drive Addison, Texas 75001 E-Mail: [email protected] Telephone: 972-991-2222 Facsimile: 972-386-0091 Attorneys for Plaintiffs-Appellants

By: /s/ Michael J. Avenatti Michael J Avenatti California Bar Number: 206929 Ahmed Ibrahim California Bar Number: 238739 EAGAN AVENATTI, LLP 520 Newport Center Drive, Suite 1400 Newport Beach, CA 92660 E-Mail: [email protected] [email protected] Telephone: 949-706-7000 Facsimile: 949-706-7050 Attorneys for Plaintiffs-Appellants

Case: 15-10242 Document: 00513165491 Page: 62 Date Filed: 08/21/2015

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CERTIFICATE OF COMPLIANCE

This brief complies with the type-volume limitation set forth in the Federal

Rules of Appellate Procedure 29(d) and 32(a)(7)(B) and Fifth Circuit Rule 32. This

brief contains 13,988 words, from the Introduction through the Conclusion, as

determined by the Microsoft Word word-processing program, with 14-point

proportionally spaced type for text and 14-point proportionally spaced type for

footnotes.

By: /s/ Michael J. Avenatti Michael J Avenatti

Case: 15-10242 Document: 00513165491 Page: 63 Date Filed: 08/21/2015

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CERTIFICATE OF SERVICE

I hereby certify that on August 21, 2015, the foregoing Record Excerpts of

Plaintiff-Appellants was electronically served on the counsel listed below via the

Court’s CM/ECF Notice of Activity system at their electronic addresses of record:

Mr. Richard Thaddeus Behrens: [email protected], [email protected] Mr. George W. Bramblett, Jr.: [email protected], [email protected], [email protected] Mr. Farbod Farnia: [email protected], [email protected] Mr. William Feldman, Attorney: [email protected], [email protected] Mr. Daniel H. Gold: [email protected], [email protected] Ms. Anne McGowan Johnson: [email protected], [email protected], [email protected] Mr. Christopher Scott Ayres: [email protected], [email protected], [email protected] Mr. Michael J. Avenatti: [email protected], [email protected], [email protected], [email protected], [email protected]

By: /s/ Michael J. Avenatti Michael J Avenatti

Case: 15-10242 Document: 00513165491 Page: 64 Date Filed: 08/21/2015