General

Considering how contract disputes affect consumers

Contracts can be the backbone of any business relationship. However, it is important to appreciate the fact that these contracts and the terms set therein can affect parties other than those directly linked by the contract.

For example, let’s consider the frequent disputes between broadcasters and cable providers. For years, clashes have arisen between these two parties that typically end with channel blackouts and/or contract re-negotiations. While both sides in this matter have issues that need to be resolved thoughtfully and carefully, the impact of these situations on consumers should not be overlooked in how these negotiations proceed.

It has been said that the consumers are the ones directly penalized by these disputes because ultimately, it is the services they pay for that are used as bargaining chips. If the negotiations are successful, the services can stay intact; if not, the consumer loses out. And unfortunately, these clashes happening over and over again.

The situation between broadcasters and providers has gotten so concerning that the Federal Communications Commission is now stepping in with proposals to examine current negotiation efforts between the two parties.

According to this blog post by FCC Chairman Tom Wheeler, a proposal to evaluate and enforce rules that dictate good faith negotiation has been circulated. This could ultimately impact how broadcasters and providers define, set and comply with contractual terms.

While this particular relationship has been in the news, there are many companies that face far-reaching consequences if they cannot resolve disputes quickly and effectively. Parties who fall into a contract dispute have a lot on the line, whether it’s pay for workers who have completed a project or business from consumers who lose out on services they paid for.

Resolving contract disputes quickly in these situations can be crucial considering how much is at stake. However, this doesn’t mean that negotiations shouldn’t be thought-out and considered carefully. In situations where disputes could lead to serious penalties unless they are resolved quickly, it can be especially important to have the guidance of an attorney.

Mon Aug 27, 3:20pm