Don't Promise $1 Million For Your Lost Laptop Via YouTube & Twitter If You're Not Prepared To Pay

from the just-saying dept

The Hollywood Reporter has the somewhat amusing cautionary tale of why you shouldn’t use various social media tools to make promises you can’t back up. Hip hop/R&B artist Ryan Leslie apparently lost his laptop recently while on tour in Germany. He then went on YouTube and posted a video offering $20,000 if anyone returned the laptop. He noted that the laptop contained music and videos that he wanted back. Another video was posted later with a message that reads: “In the interest of retrieving invaluable intellectual property contained on his laptop and hard drive, Mr. Leslie has increased the reward offer from $20,000 USD to $1,000,000 USD. He also tweeted the same info directly, saying: “I raised the reward for my intellectual property to $1mm.”

Then the problem. A guy named Armin Augstein found the laptop. And claimed the $1 million. Leslie refused to pay and everyone went to court. Leslie, perhaps quite reasonably, noted that the returned laptop was broken such that the hard drive didn’t work, and the content he had hoped to retrieve was not available. According to the judge’s account from back in October:

After Augstein returned the laptop and hard drive, Leslie refused to pay the reward because, Leslie alleges, the intellectual property for which he valued the laptop was not present on the hard drive when it was returned. Leslie claims that he and several staff members tried to access the data on the hard drive but were unable to do so. Leslie sent the hard drive to the manufacturer, Avastor, which ultimately deleted the information prior to sending Leslie a replacement. The circumstances of the return of the hard drive and the meaning of Leslie’s communications with Avastor are disputed. Augstein claims that Leslie, after he received correspondence from Augstein regarding the collection of the reward, caused the hard drive to be erased.

I can definitely see a reasonable argument that having the laptop returned without being able to retrieve the content shouldn’t qualify for the reward (especially since in the initial offer, Leslie specifically called out the value of the “intellectual property” on the laptop as his reason for offering a reward), though the disputed info makes it a bit fuzzy. Leslie also argued that “a reasonable person would not have understood the mention of the reward to be an offer of a unilateral contract, but instead would have understood it to be an advertisement—in essence, an invitation to negotiate.” That seems like a much more difficult argument to make, and the judge, Harold Baer, didn’t buy it at all:

A reasonable person viewing the video would understand that Leslie was seeking the return of his property and that by returning it, the bargain would be concluded. The increase of the reward from $20,000 to $1,000,000, the value of the property lost (in particular the unreleased album) and the news reports regarding the reward offer would lead a reasonable person to believe that Leslie was making an offer. As such, the video constitutes a valid offer and summary judgment is granted as to that issue. “[I]f a person chooses to make extravagant promises . . . he probably does so because it pays him to make them, and, if he has made them, the extravagance of the promises is no reason in law why he should not be bound by them.”

I can definitely understand why the offer was considered valid, but given how often he specifically called out the content on the hard drive as being what’s valuable, why did the judge consider the “offer” to have been met by Augstein? Because of what Leslie did after getting the laptop back. The issue here, it seems, is that “Leslie was on notice that the information on the hard drive may be relevant to future litigation and, as a result, had an obligation to preserve that information.” And the judge is not at all happy with how he handled the situation:

Whether a party must prove that the destroyed evidence is relevant to a claim or defense depends on the level of culpability. “When evidence is destroyed in bad faith (i.e., intentionally or willfully), that fact alone is sufficient to demonstrate relevance. By contrast, when the destruction is negligent, relevance must be proven by the party seeking the sanctions.” … The contents of the hard drive are undoubtedly relevant, regardless of the culpability. The satisfactory performance of the offer of the reward depends on the return of Leslie’s intellectual property.

The judge goes on to point out that, while some of the facts are disputed, there isn’t much evidence that Leslie or people who worked with him had Avastor try to recover the data (though other testimony suggests they asked data recovery shops and were told that the data could not be recovered). Either way…

Based on the foregoing, and the inescapable fact that the hard drive was destroyed when litigation was all but certain, I find that Leslie and his team were at least negligent in their handling of the hard drive.

That’s a no-no.

The jury then took all of this in and came back telling Leslie to pay up the $1 million. Apparently even they were conflicted about the amount, but were left with little choice:

The verdict came about 45 minutes after jurors sent out a note saying they were divided because “we feel the $1 million is too high,” and asking if they could compromise on a lower amount.

Leslie’s lawyers then sought some time to try to strike a settlement, but Augstein’s team said “that ship has sailed” and insisted that the jury be told to continue deliberating toward an all-or-nothing decision.

It seems likely that he’ll appeal, but I imagine this story is going to make a fun case study for various lawyers who teach contract law… and for the rest of you, it should be a reminder to be careful what you promise.

Filed Under: contracts, lost computers, ryan leslie