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Last week, Chelsea Handler filed a lawsuit against ThirdLove, alleging the lingerie company failed to honor its contractual commitments to her and refused to compensate her for an ad campaign she hired her for. to manage.
According to the complaint, the parties negotiated and finalized a term sheet by December 21, 2021 for a one-year contract under which Handler would exclusively promote the brand. The parties exchanged drafts of the full deal and were reportedly close to the start of the term on Jan. 1, 2022. In anticipation of the deal closing, Handler began preparing for the campaign by launching an exercise program , participating in meetings, assisting with wardrobe arrangements and preparing for a shoot.
In addition to preparing for the campaign, Handler alleges that she turned down opportunities to work with competing companies based on the project’s exclusivity clause of the deal with ThirdLove. For example, she forwarded requests from various sportswear brands, she refused to have another sportswear company buy ads on her podcast, and she was forced to discontinue ads from an existing sponsor.
On January 26, 2022, the day before the planned campaign shoot, ThirdLove called off the deal. Handler believes the creative team behind his campaign never got approval from the company’s board of directors, and when the board learned about the campaign just before filming, they didn’t. didn’t want to go ahead. Handler alleges that she tried to reach a reasonable settlement with the company, but they ignored her demands.
Last week, Handler filed a lawsuit in California alleging breach of contract and promissory estoppel. She is seeking full payment under the agreement (which amounts to over $1 million), recovery of expenses she incurred in preparing to meet her obligations under the deal and the loss of revenue from brand deals it was forced to turn down under exclusivity. clause.
It is likely that anyone working on these types of agreements will recognize some elements of this de facto pattern. Much to the chagrin of the attorneys involved, it’s not uncommon for the parties to start working on a campaign before the deal is signed. Although the parties usually manage to work things out in the end, this case demonstrates that not all stories have happy endings.
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