Breach of Contract – Referral Agreement

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7^th Circuit Court of Appeals

Case Name: Entertainment USA, Inc., v. Moorehead Communications, Inc.,

Case No.: 17-2847

Officials: RIPPLE, KANNE, and HAMILTON, Circuit Judges.

Focus: Breach of Contract – Referral Agreement

In 2006, plaintiff Entertainment USA sold cellular telephones and service contracts in central Pennsylvania through a network of retail dealers. Defendant Moorehead Communications, an Indiana company, sought to break into that geographic market by offering dealers the chance to sell Verizon products and services. Without aid of counsel, the two companies signed a two‐page “referral agreement” connecting Moorehead with a number of Entertainment USA’s dealers. The agreement promised Entertainment USA a “referral fee” for every Verizon activation or upgrade that resulted.

Six years later, this referral agreement became the subject of litigation in the Northern District of Indiana. Entertainment USA alleged that Moorehead breached the agreement by discontinuing the referral payments. After a bench trial, the district court agreed that Moorehead had breached, but in much narrower ways than Entertainment USA had claimed. The court also found, however, that Entertainment USA had failed to prove the amount of its damages with reasonable certainty. The court therefore awarded no damages to Entertainment USA. Entertainment USA, Inc. v. Moorehead Communications, Inc., 2017 WL 3432319 (N.D. Ind. Aug. 9, 2017). We affirm.

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.