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Do your obligations continue in a breach of contract dispute?

Contracts are fundamental to business operations. As a business owner, you may have contractual obligations with a wide range of entities, such as your co-owners, shareholders, vendors, commercial landlord, local zoning authority, and state and federal tax authorities. Of course, those legal obligations also raise the possibility of business disputes.

When one party alleges a breach of contract, it is important to understand any continuing obligations owed under the contract. As this example illustrates, financial liability may continue to accrue under a contract.

When one party alleges a breach of contract, it is important to understand any continuing obligations owed under the contract. As this example illustrates, financial liability may continue to accrue under a contract. 

In a recent example, a Houston-based company called Intuitive Machines LLC, prevailed in a breach of contract dispute in a federal district court. The jury awarded the company $4.1 million as compensation for what the company might have recovered under the completed contract.

The contract called for Intuitive Machines to develop flight software for commercial lunar lander missions. When the other party, a company called Moon Express, became dissatisfied with the progress of the intellectual property, it halted its payments to Intuitive Machines and filed the lawsuit, a legal determination that Intuitive Machines was in breach. 

If you are facing a threat of business litigation, you need a business-minded law firm to guide you through the process. If one party to business contract disputes the other’s performance, it may halt payments. That, in turn, impacts the legal strategy that is best for your situation. Our Houston law firm takes a practical approach to business litigation. In addition to assessing the litigation merits and hazards of your claim, we take the time to understand how the dispute may impact your financial bottom line. If a client can afford to withstand the length of a court case, we may recommend this approach to maximize your recovery. In other situations, strategic negotiations may produce a more expedient settlement.

Source: SpaceNews, “Jury awards Intuitive Machines $4.1 million in cash and Moon Express equity,” Debra Werner and Jeff Foust, Jan. 26, 2018

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