First Department Rejects Kesha’s Proposed Counterclaims Seeking to Terminate Contracts With Dr. Luke
May 31, 2018
In a recent decision handed down just a couple of days ago, the Appellate Division, First Department affirmed Justice Kornreich’s denial of singer and songwriter Kesha Sebert’s (“Kesha”) motion for leave to file second amended counterclaims, meaning Kesha will not be released from her recording contracts with producer Lukasz Gottwald, also known as Dr. Luke (“Gottwald”), and his former label, Kemosabe Records.
In October 2014, Gottwald sued Kesha in the New York County Commercial Division for, among other things, defamation and breach of contract after the singer accused Gottwald of various forms of abuse. Kesha asserted several counterclaims. Nearly three years later, Kesha moved for leave to assert second amended counterclaims seeking, among other things, a declaration terminating the agreements on the grounds of impossibility and impracticability of performance, and on the ground that the agreements violate California Labor Code § 2855, a seven-year rule limiting personal service contracts.
In March 2017, Justice Kornreich of the New York County Commercial Division denied Kesha’s motion for leave to amend, finding that Gottwald’s alleged behavior was foreseeable at the time Kesha entered into the recording agreements. As Justice Kornreich noted “[t]he defense of impossibility or impracticability of performance is applied narrowly and excuses contractual performance only when the destruction of the subject matter of the contract or the means of performance makes performance objectively impossible due to an unanticipated event that could not have been foreseen or guarded against in the contract.” Kesha appealed.
The Appellate Division, First Apartment affirmed Justice Kornreich’s decision, holding that Kesha’s counterclaim for a declaration terminating the agreements on the ground of impossibility and impracticability of performance was “speculative” and “contradicted by her own allegations that she had continued performing under the recording agreements.”
The First Department also rejected Kesha’s proposed declaratory judgment counterclaim based on California Labor Code § 2855 because it is barred by the choice of law provisions contained in the recording agreements. Based on the foregoing, the Court agreed with Justice Kornreich, finding Kesha’s proposed amendments were “palpably insufficient and devoid of merit.”
Finally, the First Department upheld Justice Kornreich’s decision compelling Kesha to produce documents held by her public relations firm and former attorney, holding that these communications “do not reflect a discussion of legal strategy relevant to the pending litigation but, rather, a discussion of public relations strategy, and are not protected under the attorney-client privilege.”