The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The Ministry of Tourism's latest bid to dismiss a former Bahamian beauty queen's breach of contract claim was yesterday rejected by a US judge because it "misses the mark".

Judge Nancy Atlas, sitting in the south Texas federal court, delivered another setback for the Ministry in its ongoing battle with Khiara Sherman, the former Miss Bahamas Universe, by describing its legal arguments as "flawed".

The ruling leaves the Ministry of Tourism in a worse position than after its first attempt to dismiss Mrs Sherman's lawsuit. It had, in mid-April, persuaded Judge Atlas that Mrs Sherman's claim for breach of her $130,000 employment contract should be thrown out because she had failed to plead "sufficient facts" to support her case.

However, the former beauty queen's main complaint - that the Ministry of Tourism had violated her copyright by using her song, Fly Away With Me, without permission in its promotional campaigns - managed to survive that first challenge.

Mrs Sherman and her attorney then filed an 'amended complaint', setting out additional facts and providing supporting materials, including e-mails detailing the employment negotiations, to back her breach of contract claim.

The Ministry of Tourism, seeking to have this dismissed again, argued in legal papers obtained by Tribune Business that the evidence showed it "never executed an employment agreement" with the ex-beauty queen who once represented the Bahamas at the Miss Universe Pageant when it was controlled by now-US president, Donald Trump.

Arguing that Mrs Sherman's e-mail chain did not include the "material terms" of an employment contract, the Ministry of Tourism and its attorneys said this was sufficient grounds for dismissal because the absence of specific "job duties" failed to meet the US 'statute of frauds'.

Judge Atlas, though, was unpersuaded. She ruled: "According to defendant [Ministry of Tourism], the agreement is subject to the statute of frauds because it has a three-year term, and thus must be evidenced by a writing containing all of its essential terms.

"Defendant contends that because the writings attached to the amended complaint do not contain all material terms of the agreement, namely Sherman's duties as a marketing representative, her breach of contract claim fails to satisfy the statute of frauds and must be dismissed. Defendant's theory for dismissal misses the mark."

Judge Atlas said US legal procedure undermined the Ministry of Tourism's case, as Mrs Sherman's arguments did not have to meet the 'statute of frauds' at the initial stages of the case. She also ruled that the ex-beauty queen had established "a plausible claim" at the pleadings stage.

"It is undisputed that for Sherman ultimately to prevail on her breach of contract claim, the [employment] agreement, which Sherman alleges has a three-year term, must comport with the statute of frauds," Judge Atlas ruled.

"Defendant [Ministry of Tourism] argues that because the e-mails and letters Sherman attaches to the amended complaint omit any description of Sherman's duties as a marketing representative, an alleged 'essential element' of an employment agreement under Texas law, those writings cannot satisfy the statute of frauds and Sherman's breach of contract claim fails as a matter of law.

"Defendant's reasoning is flawed in that it incorrectly assumes that Sherman is required to satisfy her ultimate burden of definitively establishing the agreement satisfies the statute of frauds at the pleading stage.... Sherman can survive a motion to dismiss based on the affirmative defense of the statute of frauds by pleading factual allegations to plausibly suggest that the agreement is evidenced by defendant's writings containing all of its essential terms."

Judge Atlas ruled that dismissing Mrs Sherman's claim now would be contrary to settled Texas law, and added: "Defendant's [Ministry of Tourism] argument that Sherman cannot prove the agreement is evidenced by a writing containing all of its essential terms, including her duties as a marketing representative, is inappropriate at this pre-discovery stage of the litigation."

She also rejected the Ministry of Tourism's renewed argument that Mrs Sherman's case again lacked sufficient supporting facts, finding: "Sherman's allegations in the amended complaint also support a reasonable inference that Sherman was ready, willing and able to perform her obligations under the Agreement.

"Plaintiff Sherman adequately has pleaded the second element under Texas law of her breach of contract claim."

Meanwhile, other legal papers obtained by Tribune Business reveal that Dionisio D'Aguilar, the minister of tourism, and the Ministry's most senior officials may have to have to give oral evidence as part of the dispute. Apart from the Minister, others named in the list of witnesses to give "oral depositions" are Charles Albury, the Ministry's permanent secretary, and Joy Jibrilu, the director-general of tourism.

The papers also indicate a change of strategy by the Ministry of Tourism in defending itself against the copyright violation complaint by Mrs Sherman and her record company, AK Fortyseven Records.

While the Ministry had previously vehemently denied any copyright breach, the two sides' joint discovery/case management plan shows it is now claiming "a valid license" allowed it to use the Fly Away With Me song in "two intro bumpers" to promote a Bahamian music festival - thought to be Bahamas Junkanoo Carnival.

It is also claiming that Mrs Sherman signed a "release" agreement that exempts the Ministry from any liability, financial or otherwise, for use of the song.

"Defendant states that the creation of two intro bumpers to promote a Bahamas music festival was authorised by a valid license," the Ministry of Tourism alleged. "Moreover, Mrs Sherman entered into a release, indemnification and hold harmless agreement regarding any such promotional activity.

"Without waiving the right to assert any argument, claim or defense, the three centrally-disputed issues are: the scope of defendant's use of Fly Away With Me; whether plaintiffs agreed to license the song for defendant's use and/or enter into a release, indemnification and hold harmless agreement with respect to the song; and damages, if any."