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  • videocam On-Demand
  • signal_cellular_alt Intermediate
  • card_travel Commercial Law
  • schedule 90 minutes

Requirements Contracts, Stop-Shipment Threats, and Pricing Disputes: Recent Legal Developments in Supply Chain Agreements

$297.00

This course is $0 with these passes:

CLE
ALL
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Description

Requirements contracts allow a buyer to secure a stable supply of goods without specifying the exact quantities upfront. These contracts offer benefits such as flexibility and inventory risk management for the buyer. They also benefit sellers by providing for a promise of future sales, contingent upon the continued need for the goods.

However, these contracts also pose risks to the parties if market conditions change or demand shifts drastically. Factors like supply chain disruptions and inflation often put pressure on market conditions and can lead to pricing disputes if prices become unfavorable for either party. If a supplier finds an agreed price to be unsustainable, the disputes can escalate into stop-shipment threats, which a supplier may use as leverage to renegotiate.

In the 2023 Michigan Supreme Court decision MSSC Inc. v. Airboss Flexible Prods. Co., the court held that "blanket" order language incorporated by purchasers into the contracts at issue did not supply a valid quantity term as required under the UCC. In the year since Airboss, there has been a spate of supplier challenges to unfavorable long-term agreements, and the state of the law of requirements contracts is in flux.

Listen as our expert panel discusses requirements contracts, pricing disputes, and stop-shipment threats. The panel will also review recent legal developments and cases in this area and discuss the potential future direction of the law of requirements contracts and the Statute of Frauds.

Presented By

Leah R. Imbrogno
Partner
Foley & Lardner LLP

Ms. Imbrogno assists corporate clients, specifically manufacturing and automotive companies, throughout all phases of complex commercial litigation, mediation, arbitration, and international arbitration. She has successfully litigated and tried cases in state and federal courts, the American Arbitration Association and the Singapore International Arbitration Centre. Ms. Imbrogno has substantial experience in breach of contract, supply chain, warranty, recall and products liability litigation, as well as in defending manufacturers against class actions and managing trade secret claims and shareholder disputes. She is a frequent author and presenter on supply chain and other contract issues.

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Vanessa L. Miller
Partner
Foley & Lardner LLP

Ms. Miller is a litigation partner with Foley & Lardner LLP and Chair of the firm’s national Automotive Team, as well as on the advisory committee of the firm’s Manufacturing Sector. She served as a former chair of the Detroit office’s Litigation Department. Ms. Miller's practice focuses on a wide array of supply chain disputes, including breach of contract and warranty claims, automotive supply chain issues and maintaining continuity of supply, defending manufacturers against class actions, trade secret misappropriation claims and business torts. Recognized as a nationally ranked top lawyer by Chambers for Transportation: Road (Automotive) for the past two years, showcasing her deep expertise and leadership in the field.

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Credit Information

  • This 90-minute webinar is eligible in most states for 1.5 CLE credits.


  • Live Online


    On Demand

Date + Time

  • event

    Tuesday, December 10, 2024

  • schedule

    1:00 p.m. ET./10:00 a.m. PT

  1. Requirements contracts
    1. UCC Article 2
    2. Key features and benefits for buyers and suppliers
    3. Impacts of demand fluctuation; importance of good faith in performance
  2. Stop-shipment threats as negotiation tactics
    1. Legal and strategic considerations
    2. Impact of pricing disputes on stop-shipment scenarios
  3. Recent legal developments on requirements contracts: Airboss and progeny
    1. Description of Airboss decision and interpretation of Statute of Frauds
    2. "Blanket" orders and quantity terms
    3. Shift to "release-by-release" contracts
    4. Subsequent cases
    5. Anticipated future developments
  4. Practical guidance for contract drafting and negotiation

The panel will review these and other key issues:

  • The status of the law of requirements contracts after Airboss and subsequent cases
  • Strategies for drafting enforceable requirements contracts
  • Dispute resolution options and renegotiation tips in volatile market conditions