Skip to main content

The Other Side of Hand-Shake Deals

In a prior post I said how The Profit's Marcus Lemonis should probably stop with the hand-shake deals because the risk is that hand-shake deals (or "oral contracts") may not be enforceable as contracts; you usually need the agreement in writing. (Although oral contracts can be enforceable--it's complicated.)

So it makes you wonder. Why would Lemonis do his hand-shake deals knowing they may not be enforceable agreements? He's no dope. He's a shrewd businessman. Lee Iacocca was his mentor.

Is it a gimmick for the show? Maybe, but the consequences can be an unenforceable agreement and an "expensive lawsuit" (in his words), as in A. Stein Meats.

Lemonis says he does hand-shake deals as a kind of old-school, my word is my bond, kind of thing.

I'm not so sure. The other side of his hand-shake agreements is that they give Lemonis a backdoor out of a deal that looks like it's not so good after all, e.g. the Swanson's Fish Market episode. As in "You think I'm breaching our contract? Try and enforce that agreement in court!"

Just speculation on my part.

Labels:

Comments

Post a Comment

Popular posts from this blog

Respond to Demands for Evidence or Be Prepared to Have Your Case Thrown Out!

The evidence or fact-gathering phase of a lawsuit is called "discovery". Each party is entitled to demand various kinds of evidence from the other party or parties in preparation for a possible trial. Two common kinds of discovery demands are a "Demand for Discovery and Inspection" and "Interrogatories" (which are written questions, answered in writing, under oath). (Psst: Interrogatories are basically a waste of time, but that will be left for another day.) In a recent decision , a New York appeals court affirmed the ruling of a lower court, throwing out a case for plaintiff's failing to respond to defendants' discovery demands. In that case, an LLC sued an architecture firm for malpractice and breach of contract. During the discovery phase, defendants architects served plaintiff with a Demand for Discovery and Inspection and Interrogatories. You only have 20 days to respond or object to discovery demands, or you lose a lot of rights in how yo...
Post a Comment
Read more

Consumer Law Update: FTC sues DIRECTV for Deceptive Business Practices

I'm sure most people think that "of course" big businesses are constantly, intentionally, ripping people off and are engaged in deceptive business practices. As a lawyer, my inclination is I can't believe a big business, with lots of executives and lots of lawyers looking things over, could possibly offer promos or services that are so misleading or deceptive that they are illegal. They can't possibly be that dumb. Sometimes I'm wrong. For instance, the Federal Trade Commission has sued DIRECTV in San Francisco federal court for engaging in deceptive and misleading business practices in violation of federal law. DIRECTV was telling consumers, hey, look at our low monthly rates and look at all the great stuff you get, come sign up with us! However, DIRECTV failed to adequately disclose that, oh, by the way, in order to get that great deal, you have to sign a two-year contract; those low rates are only good for the first year; your monthly bill could go ...
Post a Comment
Read more

Insurance Companies Trying to Gag Superstorm Sandy Victims?

As reported in several news articles ( this one  is free), in the aftermath of superstorm Sandy, engineering firms were hired by insurance companies to inspect the homes of people making claims for flood damage.  There have been allegations that two of the engineering firms, U.S. Forensic out of Louisiana, and GEB HiRise out of Uniondale, forged property damage reports in order to deny claims. The NY State Attorney General is investigating those allegations and wants to talk to the homeowners.  At the same time, there are about 1,800 lawsuits in federal court involving the insurance coverage claims. A three-judge panel is trying to expedite resolution of the cases.  Last week it was revealed that one of the insurance companies, The Standard Fire Insurance Company, which is a subsidiary of Travelers Insurance, drafted language in a settlement document saying that any homeowner who accepts a payout of their claims cannot cooperate with the criminal invest...
Post a Comment
Read more