Case 2:06-cv-02443-JPM-sta Document 1-1 Filed 07/17/2006
IN THE UNITED STATES DISTRICT COURT
5. Instead, Sellers participated in an invalid sale of Elvis’ home to a third-party.
6. Plaintiff, Peter J. Gleason, is a resident citizen of New York City, New York and
7. Plaintiff, Uri Geller, is a resident citizen of London, England and is a partner with
8. Plaintiff, Lisbeth Silvandersson, is a resident citizen of London, England and is a
9. Upon information and belief, Defendant, Michael W. Freeman, is a resident citizen of Memphis, Tennessee and was the co-owner of Elvis’ home with co-Defendant, Cindy Hazan.
JURISDICTION AND VENUE
14. On or about April 14, 2006, the Sellers posted Elvis’ home for sale on the Internet auction website, E-bay®. [See E-bay® posting for Elvis Presley’s 1956 House, attached hereto as Exhibit A.]
15. The E-bay® posting listed the seller’s name as “smshutts9kqe.” “Smshutts9kqe” is the E-bay® user name of Stephen M. Shutts (“Shutts”), who is a co-owner of the Honky Tonk Hall of Fame, LLC in Nashville, Tennessee.
16. Per the Sellers’ E-bay® listing, Shutts is the agent whom the Sellers hired for the purpose of selling Elvis’ home on E-bay® under his user name “smschutts9kqe.” [See Exhibit A.]
17. The Purchasers, Peter J. Gleason, Uri Geller, and Lisbeth Silvandersson, formed a partnership with the intention of purchasing Elvis’ home and bidding on the property via the E-
18. As required by the Sellers, the Purchasers pre-qualified to bid on the Elvis home
19. On May 14, 2006, E-bay® notified the Purchasers, or “pg2000,” by e-mail that their bid in the amount of $905,100.00 was the winning bid and that Purchasers “had committed to buy” Elvis’ home. The acceptance e-mail begins with the statement: “Congratulations, the item is yours. Please pay now!” [See E-bay® acceptance e-mail, dated May 14, 2006 to “pg2000,” attached hereto as Exhibit B.]
20. Under its terms and policies, E-bay® makes the following assertion: “Due to the
21. E-bay® allows users to include additional terms in their real estate postings.
22. The Sellers added language to their listing which contradicted E-bay®’s form language with intent that the E-bay® auction would create a binding contract. Sellers’ E-bay® posting did include the following assertion evidencing the intent of the parties: “Please note that bidding on E-bay® is a legally binding contract in which the winner commits to following through on the purchase.” [Exhibit A.]
23. Additionally, Sellers’ E-bay® posting offering, bidding history, and E-bay® acceptance e-mail include the following elements: (1) the identity and addresses of the parties or the parties’ agents; (2) a detailed description of the property; and (3) substantial terms, such as purchase price, acceptable methods of payment, and prequalification standards. [See Exhibit B, and E-bay® Bidding History, attached hereto as Exhibit C.]
24. Together, the E-bay® posting, bidding history, and E-bay® acceptance e-mail constitute an electronic record, or writing, evidencing electronic user names, or signatures. [See Exhibit A, Exhibit B, and Exhibit C.]
25. After bidding ended on May 14, 2006, the sale of Elvis’ home to Purchasers was highly publicized and communicated to a number of third-parties.
27. On May 16, 2006, Kathleen Webb, Esq. of Murphy, Dezonia & Webb, drafted a real estate contract, which if agreed to by both Purchasers and Sellers, would amend the initial contract for purchase to include details outlined in the above paragraph. [See Real Estate Sales contract, dated May 22, 2006, attached hereto as Exhibit D.]
28. On May 22, 2006, Purchasers signed the second real estate contract amending the initial agreement, but redacted the section providing that “Possession shall be given sixty (60) days after closing.” [See Exhibit D.]
29. Purchasers did not completely reject the delayed possession provision. Instead, purchasers were “amenable to such a provision . . . [but wanted to] . . . discuss the matter directly with the current owners.” [See Letter to Kathleen Webb, Esq. from Peter J. Gleason, attached
30. On or about May 22, 2006, Peter J. Gleason sent a check in the amount of $5000.00 as a deposit on the property to be held in escrow by the law firm of Murphy, Dezonia & Webb. Furthermore, on or about May 24, 2006 and May 25, 2006, respectively, Lisbeth Silvandersson and Uri Geller wired additional, separate deposit payments, each in the amount of $5,000.00 to Murphy, Dezonia & Webb to be held in escrow.
31. As of May 14, 2006, the date Purchasers won the right to purchase Elvis’ house, and at all times thereafter, Purchasers were ready and able to perform their part of the initial contract.
32. Despite having a valid, enforceable contract to purchase Elvis’ home with Sellers, Purchasers received an email from J. Michael Murphy, Esq., an attorney at the law firm of Murphy, Dezonia & Webb, stating that Sellers had accepted an offer from a third-party and refused to close on the property with the Purchasers. [See Email Correspondence from J.Michael Murphy, Esq. to Purchasers, dated May 30, 2006, attached hereto as Exhibit F.]
33. On May 31, 2006, Douglas M. Alrutz, Esq., counsel for the Purchasers, contacted
34. Moreover, in his correspondence to J. Michael Murphy, Esq., dated May 31, 2006, Douglas M. Alrutz, Esq. requested that any transfer or sale of Elvis’ home to a third-party be delayed until all issues involving the property could be resolved.
35. On May 31, 2006, however, the Sellers conveyed a warranty deed for Elvis’ home to the Mike Curb Family Foundation, a Tennessee non-profit corporation (“Mike Curb”), for the sum of $1,000,000.00. The warranty deed between Sellers and Mike Curb was recorded on June 2, 2006 in the Shelby County Register’s Office at Instrument Number 06088025. [See Warranty Deed between Sellers and Mike Curb, attached hereto as Exhibit G.]
38. Sellers’ acts constitute a breach of the initial contract with Purchasers for the sale of Elvis’ home.
39. Pursuant to the Uniform Electronic Transactions Act, located at Tenn. Code Ann.
41. Mike Curb’s purchase of Elvis’ home from Sellers does not terminate Purchasers’ right to specific performance, because Mike Curb is not a good faith purchaser of the property.
42. Purchasers have sustained and will sustain damages in excess of $75,000.00 as a direct result of Sellers’ breach of contract.
44. If the E-bay® posting, bidding history, and E-bay® acceptance e-mail are not sufficient to satisfy the Statute of Frauds’ writing requirement for the sale of real property, Sellers are barred from asserting the Statute of Frauds defense.
45. Sellers affixed the following statement to their E-bay® posting: “Please note that bidding on E-bay is a legally binding contract in which the winner commits to following through on the purchase.” [Exhibit A.]
46. Thus, Sellers misrepresented either their intention to produce a signed writing, that a signed writing had been produced, or their intention not to rely on the Statute of Frauds.
47. Purchasers detrimentally relied on Sellers’ misrepresentation.
48. Consequently, in order to avoid hardship and oppression, Sellers are equitably estopped from asserting the Statute of Frauds defense, and the agreement between the Purchasers and Sellers is a valid, enforceable contract.
50. After notifying Purchasers that they had submitted the highest bid for Elvis’ home, Sellers continued to solicit and/or entertain higher offers for the property from third-parties.
52. Sellers made the misrepresentation intentionally, knowingly or without belief in its truth, or recklessly without regard to its truth or falsity.
53. Purchasers reasonably relied on Sellers’ misrepresentation and suffered damages as a result.
54. Sellers’ misrepresentation relates to an existing or past fact, and/or Sellers’ misrepresentation was a promise of future action made without the present intention to carry out the promise.
55. Purchasers reassert and incorporate by reference the allegations set forth in Paragraphs 1 through 51 as though fully set forth herein.
56. Sellers had a financial interest in selling Elvis’ home and misrepresented to Purchasers that “bidding on E-bay is a legally binding contract in which the winner commits to following through on the purchase.”
57. Sellers failed to exercise reasonable care or competence in communicating or representing the nature of the agreement with Purchasers.
58. Purchasers justifiably relied upon Sellers’ misrepresentation and suffered damages as a result.