CHICAGO (CN) - NBA guard Ben Gordon does not owe his financial adviser $1.2 million, as their contract is not binding for the duration of his career, the 7th Circuit ruled.
Gordon, a shooting guard, was drafted in 2004 by the Chicago Bulls. He helped lead the Bulls to their first post-Jordan era playoff appearance that year and was the first rookie in NBA history to be awarded the NBA Sixth Man Award. He now plays for the Charlotte Bobcats.
When he signed his 4-year rookie contract, Gordon hired Larry Harmon & Associates as his financial and tax adviser for the "duration of [his] playing career," the 7th Circuit found. (Brackets in ruling.) But the agreement specified only how much Gordon would pay Harmon for the length of Gordon's rookie contract.
Gordon fired Harmon in 2007 after he advised Gordon to invest $1 million in a commercial real estate development that went sour.
Harmon sued Gordon for breach of contract, but a federal judge dismissed the adviser's claims.
The 7th Circuit affirmed on appeal.
"Because the Agreement lacks any provisions for compensation beyond Gordon's rookie contract, it does not unambiguously bind the parties for longer than the three or four years of that contract," the three-judge panel ruled.
During a deposition, Harmon testified that he and Gordon planned to sign a new agreement after Gordon's rookie contract and would renegotiate his compensation.
"Read together, Harmon's testimony and the language of the Agreement make clear that the parties intended the Agreement to last only for the length of Gordon's rookie contract. The Agreement outlined the terms of the parties' relationship for only three or four years and indicated that Harmon would provide Gordon with a new engagement letter after the conclusion of Gordon's rookie contract. Harmon's testimony is consistent with this language," Judge Joel Flaum wrote for the panel.
Harmon had asked for $1.2 million in compensatory damages, based on the contract that allegedly extended through Gordon's entire NBA career.
But the district court refused to award any damages at all, even though Gordon fired Harmon before the end of his rookie contract.
Harmon did not present "a fallback theory of damages for the fourth year of Gordon's rookie contract in the event that the district court rejected his much more ambitious $1.2 million claim. It was not the district court's responsibility to formulate that fallback theory for Harmon," Flaum wrote.
"Harmon waived his argument for damages for any premature termination of the Agreement," by presenting his claim in an undeveloped footnote, the circuit found.
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