Butler v. Balolia, No. 13-1329 (1st Cir. 2013)
Annotate this CasePlaintiff invented the "Whirlwind" technology for cutting tools. Defendant sought to purchase the Whirlwind technology from Plaintiff. The two men signed a letter of intent that memorialized the parties' mutual intention to negotiate and contained a choice-of-law provision directing the application of Washington law. After the transaction fell through, Plaintiff sued Defendant in Massachusetts state court, seeking, inter alia, a declaration that the LOI was an enforceable contract and pecuniary damages for breach of contract. Defendant removed the case to federal court. The district court granted Defendant's motion to dismiss for failure to state a claim, concluding that Washington would not recognize contracts to negotiate as enforceable. The First Circuit Court of Appeals vacated the district court's judgment in its entirety, holding (1) the Washington Supreme Court would, in all probability, recognize the enforceability of contracts to negotiate; and (2) the complaint plausibly stated a cause of action for breach of a contract to negotiate.
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