Willie German, William W. Lents, Robert Pinner, Darrell Sells, Deana Sells v. John Ford, Kent Ford, Billy Walker, and Dyer Investment Company, LLC.

This appeal involves a contract dispute arising out of the Lennox Lewis/Mike Tyson prize fight in Memphis, Tennessee. The defendant/appellee investment firm agreed to provide financing to guarantee minimum ticket sales for the prize fight. If ticket sales for the fight were below the minimum requirement, the investment firm would pay the difference, but if ticket sales exceeded the minimum, the investment firm would profit. The investment firm solicited the plaintiff/appellant sub-investor and other sub-investors to provide back-up financing, so that the investment firm would not bear the entire risk of loss in the event that minimum ticket sales were not met. The plaintiff sub-investor would also participate in the profits if ticket sales exceeded the minimum. Under the alleged agreement between the investment firm and the sub-investor, the sub-investor was to post a letter of credit in order to obtain his interest in the potential profits and liabilities. As the ticket sales were ongoing, the plaintiff sub-investor arranged for the required letter of credit to be issued, but needed information from the investment firm in order to get it issued. The investment firm did not provide the information to the sub-investor. Meanwhile, the ongoing ticket sales reached (and ultimately exceeded) the minimum requirement. At that point, the investment firm no longer faced a risk of loss and told the plaintiff sub-investor that it no longer needed sub-investors and would not go through with the agreement. The sub-investor never posted a letter of credit and the investment firm did not pay the sub-investor a percentage of the profits. The sub-investor then filed the instant lawsuit against the investment firm, alleging, inter alia, breach of contract and breach of the covenant of good faith and fair dealing. The defendant investment firm filed a motion for summary judgment. The trial court found that there was no enforceable contract because the sub-investor never posted the letter of credit, and dismissed the claims for breach of the covenant of good faith and fair dealing because they were derivative of the breach of contract claim. Accordingly, the trial court granted the investment firm’s motion for summary judgment. The sub-investor now appeals. We reverse the trial court’s holding that there was no enforceable contract between the investment firm and the sub-investor, finding that the investment firm had an implied duty to cooperate in the sub-investor’s performance of its contractual promise. Finding an enforceable contract, we also reverse the trial court’s dismissal of the claims for breach of the covenant of good faith and fair dealing.