When businesses or individuals create a business contract, the parties to the agreement are under the impression that the terms of the contract will be met. Unfortunately, some contracts do not play out as one intends, resulting in a breach of contract. In these situations, the non-breaching party could take action to address the harms caused by the breach, evening enforcing the original terms of the agreement.
Breach of contract
Based on recent reports, the music manager known for discovering Justin Bieber, Scooter Braun, is in a legal dispute with a former business partner due to failed business plans for a $750 million fund. Braun, as well as his company and current business partner, are being sued for fraud and breach of contract.
This contract dispute stems from a dispute over Scope Capital Management, which would have been the Los Angeles investment firm the pair intended in co-own. It is purported that the former business partner was tempted away from his position in 2017 by Braun with promises of investors with deep pockets who would invest in the fund. I
t is further purported that not only did Braun fail to recruit these investors, stopped funding a salary for the former business partner, defaulted on financial commitments and failed to pay bonuses owed to the team of professionals working for him. Finally, it was asserted that Braun concealed raising funds from a private equity firm in order to invest in another firm that would compete with Scope Capital in the entertainment industry.
Resolving contract dispute
In a response to this suit, Braun has sought to resolve the matter through arbitration, claiming that his former business partner’s claims are “unlawful, extortionate and opportunistic.” He further stated that there was an understanding that if his former business partner did not secure at least $250 million from investors within the first year, his financial commitment to the fund would end. The matter is moving forward with litigation, and it is not clear if the parties have or will attempt arbitration to resolve the dispute.
When contract disputes occur, it can be challenging to navigate them on their own. While there is a desire to resolve the matter as quickly as possible, this is not always feasible, as these matters can be complex. Therefore, it is important to take steps to fully understand the situation, allowing you to be aware of the available options and what is best step to take when it comes to reaching a resolution.