Business Law 5th Edition by David Twomey ,Marianne Jennings ,Stephanie Greene

Exercise 11

Ackerley Media Group, Inc., claimed to have a three-season advertising Team Sponsorship Agreement (TSA) with Sharp Electronics Corporation to promote Sharp products at all Seattle Supersonics NBA basketball home games. Sharp contended that a valid agreement did not exist for the third season (2000-2001) because a material price term was missing, thus resulting in an unenforceable "agreement to agree." The terms of the TSA for the 2000-2001 third season called for a base payment of $144,200 and an annual increase "not to exceed 6% [and] to be mutually agreed upon by the parties." No "mutually agreed" increase was negotiated by the parties. Ackerley seeks payment for the base price of $144,200 only. Sharp contends that since no price was agreed upon for the season, the entire TSA is unenforceable, and it is not obligated to pay for the 2000-2001 season. Is Sharp correct [Ackerley Media Group, Inc. v Sharp Electronics Corp., 170 F Supp 2d 445 (SDNY)]