This case is based on a real commercial arrangement between Medinol Ltd. and Boston Scientific Corp. that ultimately fell apart. The remains of the relationship were to some extent litigated and to some extent settled. The case materials begin with a delineation of the reasons the parties want to deal with each other (Part 1), move to the contracts they negotiated (Part 2), and then proceed to the problems they had when the arrangement went into operation (Part 3). The principal focus of the case is on the tension between the arrangement the parties negotiated and the relationship they actually lived. The contracts are framed as an attempt to specify what a good working relationship would be; the litigation is framed as evidence of a relationship gone sour perhaps (an important question of the case) because the contracts did not do the work they ought to have done. Thus, the final question to be asked is: Had they foreseen what was going to happen, what should the parties (or their lawyers) have done differently at the very beginning?
In contrast to much of the discussion in the Harvard Law School doctrinal course on contracts, this case tries to treat the process of contracting as a process of problem‐solving. As such, although the students represent one party, Boston Scientific, they are invited to adopt the point of view Louis Brandeis famously described as “lawyer for the situation.” The purely distributive sides of contracting are downplayed, partly because of time constraints, partly because they are more obvious to students. Thus, for example, the problem gives the students considerable contextual information from which to think about how to handle various risks to the joint production process, but little financial information from which to think about the proper split of the profits.
Table of Contents
This problem set consists of four parts:
- Part 1-The Problem presents the problem and describes the issue, background, and setting
- Part 2-The Contract gives students copies of the contracts between the two parties
- Part 3-The Litigation includes a summary of what happened next and includes copies of public documents involving litigation between the two parties
- Part 4-The Settlement includes a 2005 press release outlining the settlement between Medinol and Boston Scientific.
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- Begin to develop a systematic approach to problem solving when faced with an unresolved issue or new situation.
- Discuss relational contracts and how apparently transactional law can be adapted to relationships.
- Identify appropriate contractual language, rules, and standards. For example, how clear should the contract be versus using general terms like "reasonable efforts."
- Discuss the ethical issues involved in failure to disclose information to the other party in a contract.
- Discuss how to structure strategic partnerships and when certain types of arrangements (mergers vs. supply contracts, for example) are appropriate in various situations.
Strategic partnerships, contract law, negotiations, litigation
Geographic: United States, Massachusetts
Industry: Medical devices
Event Year Begin: 1995
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