Contracts Headline Sports Law

MLB Responds To Anheuser-Busch’s Complaint

On November 29, I discussed Anheuser-Busch Inc.’s lawsuit against MLB.  In its Complaint, Anheuser-Busch claimed that the company was entitled to a multi-year renewal on its beer-sponsorship rights based on negotiations that ended with a letter agreement in April 2010, and that MLB all of a sudden went back on its promise to renew, asking for much higher fees.  More specifically, Anheuser-Busch claims that MLB changed its mind after it found out the details of the beer company’s new sponsorship agreement with the NFL.

MLB has released a response stating that no enforceable contract ever existed between the two entities.  Instead, MLB claims that there was merely a non-binding letter of intent.  Additionally, MLB says that by signing a major deal with the NFL, Anheuser-Busch violated its own promise to make baseball its top sports property in the United States.

Letters of Intent usually are not completely binding; however, they often have sets of binding and non-binding provisions.  LOIs that are crafted by intelligent attorneys typically clearly delineate the non-binding provisions from the binding provisions within the document.  If the LOI between Anheuser-Busch and the MLB declared that the multi-year renewal was binding on the parties, then even though the entire document might not be “binding”, the parties would still have to acknowledge the provision.