When Deals Go Sideways: Is your MOU worth the paper it's written on?
In this article, I discuss a recent decision from the Appellate Division of the New York Supreme Court, applying the rule that the terms of preliminary agreements are not enforceable if the term sheet is just an "agreement to agree," subject to additional conditions (in that case, the negotiation of a definitive agreement acceptable to the parties, and subject to court approval).
When the stakes are high, and the negotiations difficult, it can be useful to bring a seasoned litigator onto your deal team (even in the background), with an eye towards the possibility of future disputes. Knowing the law in this area, and how the courts may view the course of negotiations, can create invaluable leverage. Nobody wants litigation, but sometimes it is unavoidable -- and sometimes it provides you with your best path forward.