Facts

Plaintiff Ed Limato, International Creative Management's (ICM) former co-president and long-time motion picture agent, sought declaratory relief against defendant ICM Inc., a leading talent agency over whether the agency could block Limato's departure with his roster of clients before the expiration of his employment contract. Limato's co-presidency ended in July 2007 after the agency announced a restructuring of their motion picture department to ensure long-term growth. The 2006 contract had stated Limato would remain at the company as an agent, and would no longer serve as co-president after July 1, 2007.

The parties entered into binding arbitration.

PLAINTIFF'S CONTENTIONS:
Limato argued that under California Labor Code Section 2855, a unique personal services contract may not be enforced beyond seven years. Since Limato worked continuously at ICM since 1988, large parts of the 2006 contract were void under the seven-year rule. Limato argued that all of the contracts were tantamount to one main contract. Limato also alleged that ICM engaged in conduct that excused his performance under the 2006 contract.

DEFENDANT'S CONTENTIONS:
Defense counsel argued they were merely enforcing a contract that Limato signed in 2006 that stipulated Limato was to remain with ICM until 2010. Defendant claimed that each contract was separate, resetting the clock for the seven-year rule.

Result

Retired state and municipal court judge, JAMS arbitrator Diane Wayne conducted the arbitration and found ICM had not engaged in any conduct that would excuse Limato's performance, but allowed Limato to end his contractual obligations and accept new employment opportunities based on the seven-year rule.