Case Scenario: Big Time Toymaker
Big Time Toymaker (BTT) develops, manufactures, and distributes board games and other toys in North America, Chou is the inventor of a new strategy game he calls Strat. BTT had an interest in distributing Strat and entered into an agreement with Chou, offering him $25,000 in exchange for exclusive negotiation rights for a 90-day period. This agreement stipulated that no distribution contract existed unless it was in writing.
On day 87 of the agreement, the parties held a negotiation meeting and came to an oral agreement on the terms of the distribution agreement. Chou offered to draft the written distribution agreement and send to BTT. Before Chou could draft…show more content… Any reasonable person would be led to believe BTT’s objective intent was to sign a deal with Chou. At no time, prior to the change in management, did BTT lead Chou to believe they were not interested in distributing his game.
However, BTT’s actions could also weigh against Chou, the first agreement clearly stipulated that no distribution agreement exists unless in writing. The face-to-face negotiation meeting ended in an oral agreement. The court could see the subsequent e-mail from the BTT manager outlining the minutes of the meeting as part of the negotiations, although not likely as it was ambiguous. Chou’s faxing the draft agreement a month later could show he did not interpret the “Strat Deal” e-mail as the final written agreement.
3. Does the fact that the parties were communicating by e-mail have any impact on your analysis in Questions 1 and 2 (above)? The fact that the parties were communicating by e-mail does have an impact on my analysis. I considered all the facts. The e-mails represent an acknowledgment by both parties of the distribution agreement made during the meeting despite that the e-mail fails to mention the term “contract.” BTT’s manager did a poor job of protecting BTT’s liability but using ambiguous terms like “Strat Deal” and these “terms are agreed upon,” that could lead a reasonable person to believe the e-mail was the written agreement. 4. What role does the statute of frauds play in this contract?
The statute of frauds
