Welbaum Guernsey
Bring Clarity to Your LegalProblems. Call Us At:
800-509-4946

Failed contract negotiations between businesses effect customers

Contract disagreements between Florida businesses can affect the profits of the businesses in dispute. However, such disputes can also affect the customers of one or both enterprises.

An example is seen in the dispute between AT&T’s U-verse and Sunbeam Television Corp., who owns Miami’s WSVN-Fox 7. The effect on customers of one party can be had not just by existing contract breaches but also by the inability of the two businesses to execute a new contract. If the battling companies cannot work out their differences and a contract fails to be born, the consumers may be deprived of expected services they enjoyed before, but will not longer be offered. 

At stake between AT&T and Sunbeam was the ability of U-verse customers to see a weekend NFL playoff game occurring between Carolina Panthers and Seattle Seahawks. In fact, there was to be a black out as soon as the existing contract between the parties expired that weekend. Sunbeam was seeking higher transmission fees in a new contract, purportedly to offset the decrease in advertising revenues resulting from viewers skipping commercials with the aid of their DVR technologies. AT&T argued that Sunbeam was asking for too much of an increase in the transmission fees. Sunbeam may also have been concerned that if it allowed AT&T a lower transmission fee term than it sought, then other networks would demand the same.

According to Black’s Law Dictionary, the two parties, to make a new contract, would have had to succeed in having a meeting of the minds. A meeting of the minds is a requirement for all contracts, and the parties must agree on the exact terms.

Typically, for successful business contracts and to achieve a meeting of the minds, negotiations must take place, often extensively. If the negotiations fail, so to will any potential contract and customers may be affected.

No Comments

Leave a comment
Comment Information

2151 S. Le Jeune Road, Suite 200
Coral Gables, FL 33134

Toll Free: 800-509-4946
Fax: 305-441-2255
Map & Directions