ESPN, based out of Bristol, Connecticut, had been sued on a number of claims by Dish Network Corp. concerning a business contract dispute. Dish claimed that ESPN violated a most-favored-nation clause that was contained in the contract. This clause supposedly meant that ESPN was obligated to provide Dish the same terms that it offered any competitor regarding its sports programming contract.
Though Dish claimed $153 million in damage, the jury only returned a favorable verdict on one of the claims in the amount of $4.85 million. The low verdict amount may have come about due to the argument of ESPN attorneys that Dish had been offered the same terms as ESPN provided to other distributors, and that Dish was only seeking to better contractual terms than these other distributors.
The way a party's case is represented by their attorney in court can have significant consequences for the companies involved in a dispute. Not all parties can come to agreement over contract terms, and the differences between each party's positions can amount to tens of millions of dollars.
These contract disputes are also not as simple as some would assume. Beyond the contract language itself, many business contract disputes revolve around business practices that both parties of a dispute are accustomed in regards to relations with each other. Every dispute is dependent upon the facts of the individual situation.
Also, the difference between a $153 million claim and a $4.85 million verdict is extremely substantial. And winning or losing such a lawsuit can affect public relations for the parties. In the aftermath of the verdict, ESPN's stock price rose slightly while Dish Network's stock fell.
Source: Bloomberg Businessweek, "Dish Loses 3 of 4 Claims Against ESPN in Contract Dispute," by Don Jeffrey, March 1, 2013
- Breach of contract and interference with contracts are significant business-type disputes that can result in litigation. Please visit our Hartford, Connecticut website regarding possible solutions.