Human relationships are quite complex and no place is this fact clearer than in a courtroom. Folks, we open the week with this heavy, heavy case of Antonio De La Rua (De La Rua) v. Shakira. AML people, industry, this is a case you ought to bookmark and reference periodically as a reminder of what not to do. Independent of the “what not to do” lessons throughout this case, there are so many themes running here that makes it so fascinating to watch and analyze. There are themes of friendship, love, loyalty, respect and the lack thereof, betrayal, trust and the lack thereof and of course partnerships.
Let’s start with the human psychology aspect of this case, then look at the procedural and finally wash it all down with the merits i.e. what are the chances of De la Rua prevailing?
Human Psychology & its Many Complexities, The Key Facts
If you are just joining me on AML, welcome. Most of my long time readers know I am a firm believer that where there is a breakdown in relationships which cause people to sue each other, trial lawyers get more accomplished if they study and seek to understand the motive/psychology driving each side’s conduct. This rule applies, however, to all kinds of relationships. The saying “walk in someone else’s shoes,” although very hard to do, is a necessity when battle lines are drawn. To tune into and understand the powerful emotions that drive human actions is to become adept at helping resolve all kinds of complex situations, including issues like these. At a minimum, even if there is no resolution; it creates for a stronger strategy and better ammunition in litigating a case.
What is this case really about? Let’s quickly look at some key facts:
- In 2000 Shakira and De La Rua met. De La Rua a trained lawyer in Argentina with a background in marketing, brand-building and political campaigns was managing his father’s political campaign who was running to be elected as the President of Argentina, at the time. His father ultimately prevailed.
- In 2001, Shakira and De La Rua moved in together and began shacking up i.e. living together. From 2001 to about 2003, while still living together, De La Rua served as an informal advisor to Shakira.
- The two also bought many properties together throughout the course of their relationship within and outside the USA (Miami, New York, Uruguay, Punta Del Este). They seemed like they were planning a life together, i.e. grow old together.
- In 2004, according to De La Rua, Shakira although successful prior to dating De La Rua, had just completed a global tour where she lost millions. As insiders and industry people know, publicity does not necessarily equal or have any correlation to the financial stability or health of celebrities who are constantly in front of the camera. In any event, concerned about her future and building a sustainable career and the millions she had lost, Shakira allegedly asked De La Rua to handle her career. De La Rua’s complaint claims Shakira, although he had no background managing artists, trusted he was the only one able to manage her career i.e. the “Shakira brand.” It is alleged that they formed an agreement at that point.
- The essence of their agreement was as follows: a. De La Rua would bring the sweat equity i.e. labor while b. Shakira would focus on the artistic/creative aspect of the business. Sounds like a marriage made in heaven, doesn’t it? The inference then is that Shakira contributed all of the capital that came to the business. c. The duo, as partners, according to De La Rua would share both profits and losses in the business. There is no mention of the breakdown of this profit sharing scheme. Although De La Rua in his suit now claims 15-20% owed for profits the business enjoyed. De La Rua ended up managing almost 11 companies owned by the Shakira brand.” d. In addition to De La Rua forming this business venture/partnership with Shakira, he was also an employee in the Shakira brand and had the final say on all of her business matters. There is evidence via email where Shakira communicates this fact to an employee regarding De La Rua. Given that an artist’s career encompasses more than just recording, De La Rua also handled all aspects of touring, licensing, endorsement and sponsorship deals and so much more for Shakira and the Shakira brand. He even negotiated a $300million Live Nation deal, in 2008, a major deal for the brand. e. All of these agreements were oral. There was nothing in writing.
- Consistent with what De La Rua thought his role was, he basically used all of his skill sets and experience to turn the company around. Indeed the ‘Shakira brand” never suffered a loss from 2004 onwards.
- In 2010, the romantic relationship for the two was simply not working. By January 2011, the two called it quits with their romantic relationship. Shakira, took the extra step of contacting LIVE Nation executives, via email, and assuring them that De La Rua remained “Partners” with her. In addition, she also took to social media and informed the public and her fans that they were still partners. She said the duo “view this period of separation as temporary and as a time of individual growth as we continue to be partners in our business and professional lives”, with de la Rúa managing her “business and career interests as he has always done.”
- Despite these assurances, Shakira by October 2011 ordered her attorneys to give De La Rua a “termination” letter. De La Rua claims he tried to communicate with her to resolve the issue outside of court. Instead, she refused to have such real dialogue with him and he was left with no choice but to sue.
- In 2010, during the shoot for her “Waka Waka” Africa song for the World Cup held in South Africa, she met her handsome football player Gerard Pique when he appeared in her music video. About two months after her announcement of her termination of her romantic relationship with De La Rua, in March of 2011, she announced to the world she was now dating Pique. Eight months later, she gave De La Rua the boot out of all aspects of her life i.e. also “terminated” her business relationship with him. By September of 2012, Shakira was pregnant for Pique and this January 2013, the couple just had their first child.
- Shakira has allegedly responded to De La Rua’s lawsuit, according to TMZ. She says yes he gave her advice but he was NEVER her manager. It looks like she is also denying the existence of a partnership. Instead, she says in 2006, they had an agreement in her native country Colombia and that agreement made it clear they would each keep their assets if they split.
I. What this Case is Really About
So what is this case really about? Is it about the money? In my view, if these two are both honest, absolutely NOT. As much as the money may be the focus, it really isn’t about the money.
This case is about jealousy (the strongest of the emotions, if you ask me), perceived betrayals, bruised egos, lack of trust, lost friendship, loss of respect, and a seeming lack of appreciation for someone who has sacrificed almost everything to get Shakira where she is today. The facts of this case has universal themes we see often. The difference here is that we usually see men play the lead character but here it is a woman. It’s not everyday a woman kicks a man to the curb and ends up holding the big bag of cash.
De La Rua dated Shakira for almost eleven years and for whatever reason, he couldn’t close that deal i.e. put a ring on it or get her pregnant like Pique. He closed every other deal relating to Shakira but the personal/romantic relationship, he just couldn’t. Worse, while at it, he let his heart do all the talking and checked his law degree and business acumen at the door. They separated because things were not working out and before he can even get the chance to understand what is going on, she has a new man, dumps him both personally and professionally and also gets pregnant for her new man. You better believe that is a BIG part of what is going on here, even if he never admits it. I also think what is left unspoken is the role her new guy played in this breakup. If Shakira was so close to De La Rua sharing everything including the health and details of her business with him, when they dated, what makes us think she is not and did not do that with Pique, her baby daddy?
Business partnership relationships are very intimate and while you may severe a personal relationship with your ex-boyfriend, ex-girlfriend, mother, best friend, friend, father et al. the closeness you share in a partnership relationship will still make it seem like you both are still in a relationship. The personal relationship you thought you took care of easily and does spill into the professional. It just is what it is. You can’t cheat nature. With a new man on the scene who is now Shakira’s baby daddy, De La Rua or Pique (he just got on the scene) would have eventually had to go. De La Rua got the boot.
There is a lot of pain here, $100million worth of pain, and until Shakira acknowledges and shows just basic respect for the sacrifice, loyalty et al. De La Rua put into her brand and business, this lawsuit could turn uglier.
Okay, that’s my take on the psychology and motive behind this lawsuit. De La Rua is the one really hurting and the lawsuit is a showing of that hurt. The guy did not take a dime from a multi-million dollar business for seven (7) years. He also failed to have a contract. A lawyer, really? Why now?
II. Now to the Procedural Aspects of This Case
De La Rua filed his case in California. Shakira can try to get the case moved to a different state i.e. Miami and New York where the two are said to have property. It seems this is not really an issue and Shakira may be okay with having the case heard in California. If she also insists on the 2006 contract they allegedly signed in Colombia as the controlling contract in their agreements, the case might very well leave US shores. It depends on the facts. For now, they are in California.
If you are De La Rua, you want this case before a jury. You want to appeal to their emotions. You want them looking at you as the victim of an ungrateful, greedy woman who screwed you over in exchange for your love and loyalty to her. In contrast, if you are Shakira, you want a Judge.
De La Rua got screwed, it appears, partly by his own doing. Having a judge decide this case may be more of a very logical intellectual exercise that may see him recover very little, if at all. Either way, for De La Rua, it is better to have a jury focus on a case that boils down to “he said, she said” and the credibility of the parties..
“Alter Ego” Liability
De La Rua is suing Shakira for several claims and in the body of the charging document, he pleads an “alter ego.” This just means that he seeks to hold shareholders of Shakira’s other businesses, which he does list, liable. Why? The idea is that Shakira and her companies (11 of them) are one and the same and not pleading an “alter ego” will allow Shakira to escape liability via her companies and not compensate him.
Statute of Limitation
In California, a breach of a written agreement must be filed within 4years of the date the breach occurs. If you miss the deadline, too bad, so sad. Cry a river and then move on with your life. Oral agreements need to be filed within 2years. In October 2011 De La Rua was fired. He filed his case April 12, 2013 in the Superior Court of Los Angeles so per California law, he is timely.
III. Now Let’s Look at the Merits of this Case
Folks, I would like to hear from my AML American legal colleagues on this one, especially fellow trial lawyers. What do you guys think? Very interesting case innit? For all of my amazing AML readers, I of course also want to hear from you all! What’s your take on this case?
Now my thoughts on the merits of the case.
First, objectively, I don’t like this case because De La Rua, a lawyer negotiating deals on levels many will never get to do, should have known better and done better for himself.
Second, his emotions got way too invested in Shakira he could not think straight. He lost his head. Third, there is a strong argument to be made on Shakira’s end that if indeed he was meant to be a manager, partner or joint venture owner, there would have been a contract explicitly stating this. This is precisely because of his level of business sophistication and background. If there is an internal email where Shakira is clear that he is not involved in her businesses as a manager or partner but she will help him save face in the public eye by writing the emails/social media messages saying they are still partners so he could still get a job and not botch his career, that would be deadly to him and further boost her argument.
Further, at some point, he got into an agreement as to the properties owned with Shakira and because she also intended for him to have the properties that they agreed to, she took the time to email their agreement and essential terms to their lawyer and him. The fact that there is nothing as to her businesses, in writing, is a clear showing (arguably) that they had no such venture, partnership et al that he claims.
Third, subjectively, oh my! What a case. What trial lawyer doesn’t want this kind of case? Beyond the billable hours, are you kidding me? It is messy, it is hard work, long hours but if you love getting messy and enjoy dealing with complicated issues, it is a perfect case. No written contracts, lots of “he said, she said,” lots of major headaches with the back and forth fighting but a good case, nonetheless.
IV. The Claims
Count I, II & III: Breach of an Oral Partnership Agreement, Breach of Oral Joint Venture Agreement, & Breach of Oral Employment Contract.
I don’t like these oral contract claims by De La Rua, at all. It is what will make this case very difficult for De La Ra’s lawyers. However, it makes sense that De La Rua will go this route because he is not left with much of a choice. He did not sign any agreement. The best he has is to claim an oral contract. We have talked about the essential terms of a contract in the numerous breaches of contract cases we have dealt with on AML. These basic contract principles, specific to California law, will govern the various breaches of agreements claimed here.
However, since we are dealing with various aspects of the law i.e. employment law, business law, partnership law etc., the analysis will go beyond the basic breach of contract terms to delve into the applicable niche issues present in the various areas of the law. In the case of the partnership, what kind of partnership did they have? What were the exact terms? The duration? What was to happen in the event of an expulsion? A dissolution? What about De La Rua’s “termination?” Was it lawful? As to the employment claim, was it really an employment contract? Was De La Rua more of an Independent Contractor? A Consultant?
To prevail on the breach of contract claims above, here is the basic overview of what De La Rua would have to prove to prevail as to each claimed breach:
1. De La Rua and Shakira in fact entered into a contract;
2. De La Rua did all, or substantially all, of the significant things that the contract required him to do.
3. For the things that he did not do, he was was excused from doing those things
4. All conditions required by the contract for Shakira’s performance occurred or was excused
5. Shakira failed to fulfill the terms of the contract that she was required to do
6. OR depending on the facts, Shakira did something that the agreements with De La Rua prohibited her from doing.
7. Her failure to do or not do the things agreed in the contract harmed De La Rua. This part is the damages (money you want the court/jury to award you in your case). If you don’t have damages i.e. point to the specific injury you have suffered, go home. You are wasting everyone’s time.
Count IV. Quantum Merit
Quantum Meruit is not a cause of action per se. It is what is called a “Common Count.” It essentially says equity would require that De La Rua should at least get something, even if the jury decides there is no breach of oral partnership, joint venture or an employment agreement. It is almost a “let’s throw in the kitchen sink” and see what sticks kind of cause of action. Will it work? I think it will because Shakira’s social media message and emails contradict her claims that there was no partnership or that he was not her manager. She appears to be speaking out of two sides of her mouth and unless she can come up with a better explanation for those social media statements, De La Rua may very well get something.
Count V: An Accounting
This claim here essentially demands that Shakira tell De La Rua how much she made in 2011 since he fired her in 2011 and he has no way of knowing how much the 11companies he oversaw made. When you are asking for monies from a business gone bad and you have no record keeping or no way of knowing how much was made in that business because of your abrupt exit, you want to always make sure this is included in your complaint/charging document served on the defendant. We do see this kind of claim often in copyright infringement cases, as well as breach of contract cases.
Count VI: Specific Performance of a Contract
Specific Performance essentially is the court/jury forcing someone to do something. This is distinct from an injunction where the goal is to force someone to NOT do something. In music, we see in copyright infringement cases, injunctions that force Defendants to cease from selling infringed songs/products.
In this instance, this count here is focused on the properties the duo bought together while they were living together and when all was sweet. I think this is a stronger claim and a jury may very well rule in De La Rua’s favor because De La Rua claims to be in possession of an emailed agreement from Shakira to their lawyer on January 2011 that detailed the split on how they would share their properties.
Shakira wrote that she agreed De La Rua would receive full title to New York, Punta Del Este and Uruguay properties they both own. Shakira would have full title to her Miami property, De La Rua in exchange would have full title to the Bahamas property and Shakira would have the best lot to an Island development in the Bahamas and access to the Bahamas and Punta Del Este properties.
What a case. Now over to you all. Your thoughts on the legal drama?
Click here to view the actual complaint, courtesy THR, Esq.
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