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Raiders Lose $34M Verdict Over Coliseum Deal

The Oakland Raiders suffered yet another defeat this football season when a California appeals court threw out a $34.2 million jury award favoring the team in its long battle against managers of the Oakland-Alameda County Coliseum.

A Sacramento Superior Court jury awarded the Raiders the money three years ago after finding that the National Football League team was fraudulently induced into signing a 16-year lease for the coliseum based on misinformation about ticket sales.

But in overturning the verdict, a divided panel of the California Court of Appeal ruled Nov. 17 that the Raiders, who are 2-8 this season, waived the right to sue for fraud or misrepresentation when they reworked a 1995 lease agreement with the coliseum managers in 1996.

"California law has for more than a century recognized that a plaintiff claiming to have been induced into signing a contract by fraud or deceit is deemed to have waived a claim of damages arising therefrom," the majority said, "if, after discovery of the alleged fraud, he enters into a new contract with the defendant regarding the same subject matter that supersedes the former agreement and confers upon him significant benefits."

The events giving rise to the case occurred in 1995, when the Raiders negotiated an agreement with the city of Oakland and the Oakland-Alameda County Coliseum Financing Corp. to bring the team back to Oakland as a stadium tenant. The Raiders played in Oakland for 22 years before moving to Los Angeles in 1982.

In its lawsuit the organization said it relied on written and oral representations that ticket sales would sell out for the 1995 football season. After this did not happen, the parties negotiated a new agreement the next year reaffirming the lease and lowering the team's interest payments by $109 million to make the deal more favorable for the Raiders.

In 1997 the coliseum managers sued the Raiders over the team's threat to rescind the lease and return to Los Angeles. The Raiders counterclaimed for rescission based on fraud.

In awarding the Raiders damages, the Superior Court jury found that the team had been unintentionally misled by the assertion that the stadium would sell out for the 1995 season. The coliseum managers appealed the verdict after Sacramento County Superior Court Judge Richard Park rejected their bid to set aside the award.

Writing for the Court of Appeal majority, Justice Kathleen Butz said the Raiders effectively gave up the right to sue in 1996 by ratifying the earlier contract and obtaining additional benefits.

"The Raiders try to avoid these consequences by citing evidence that both parties benefited by the June 1996 supplement, even suggesting that the Oakland-Alameda County Coliseum may have benefited more," Justice Butz said, noting that there is no rule requiring the courts to "weigh and compare the benefits received by each party."

The fact that the Raiders obtained "significant monetary and nonmonetary concessions by virtue of the new contract" effectively waives its claim for damages, she added.

Dissenting, Justice Rod Davis said he found no evidence of an implied waiver in the new lease agreement.

"I believe that the majority's approach to the doctrine of implied waiver, by basing that doctrine on estoppel while downplaying intent, is misguided," he said.