Eventbrite, Inc. v. M.R.G. Concerts Ltd.

Background

The MRG defendants filed Motion in Limine No. 2, a request to limit evidence at trial. They sought to prevent Eventbrite from offering evidence, testimony, or argument concerning an “objective standard of reasonableness” in Eventbrite’s decision to deny MRG’s advance request. At the pretrial conference, the court stated that it would deny the motion without prejudice because the motion did not identify particular evidence the defendants wanted excluded.

The parties then presented a related dispute about the legal standard governing Eventbrite’s determination that a “material adverse change,” or MAC, had occurred. The court had addressed that issue in its December 28, 2021 summary-judgment order. In that order, the court concluded that the subjective good-faith standard applied rather than an objective reasonableness standard.

Court’s Analysis

The court explained that California case law applies a subjective standard when contractual satisfaction depends on matters of judgment or on a combination of numerous considerations. The parties’ agreement did not define “material adverse change,” and the court stated that the factors relevant to determining whether a MAC occurred were numerous and left to Eventbrite’s discretion. For those reasons, the court held that the subjective good-faith standard applied.

The court also declined to reconsider the issue because Eventbrite had not moved for reconsideration of the December 2021 summary-judgment order and was raising the argument for the first time in the pretrial proceedings and supplemental briefing.

Ruling

The court adopted its tentative decision and denied MRG’s Motion in Limine No. 2 without prejudice to specific objections at trial. The court further ruled that the subjective good-faith standard would apply to Eventbrite’s determination that a MAC occurred. Judge Susan Illston signed the order on April 28, 2022.