BURBACH BROADCASTING COMPANY OF DELAWARE, Plaintiff-Appellant, v. ELKINS RADIO CORPORATION; CAT RADIO INCORPORATED, Defendants-Appellees., 278 F.3d 401

Summary

The corporation and the company engaged in discussions regarding the sale of the corporation's radio station assets. The parties signed a letter of intent. The letter stated that the corporation and the company intended to be legally bound, and agreed to the transaction based on certain terms and conditions. The letter called for a purchase price of $ 1.5 million cash at closing. The corporation's broker observed that at least $ 1.8 million would be needed at closing. The company asserted that the corporation committed a material breach of the letter of intent by demanding the additional money at the closing. The company filed suit against the corporation. The corporation moved to dismiss the complaint. The court dismissed the complaint, and concluded that the letter of intent was not enforceable. The company appealed. The appellate court suspected that the state court would recognize the second type of binding preliminary agreement, the binding preliminary commitment. Because the ...