{"componentChunkName":"component---src-templates-blog-post-ts","path":"/exorbitant-fees-leads-to-demise-of-distributor/","result":{"data":{"site":{"siteMetadata":{"title":"Clausehound Blog","author":"Joshua Koudys"}},"markdownRemark":{"id":"a66d8dff-38e9-5cb5-9e5d-42120d0692ab","excerpt":"This article is about a lawsuit alleging fraud by the supplier, who controlled the distributor, in the form of exorbitant distribution fees. “The effect of…","html":"<p>This article is about a lawsuit alleging fraud by the supplier, who controlled the distributor, in the form of <strong>exorbitant distribution fees</strong>. “The effect of Weinstein’s (the supplier) scheme was to utilize the Distribution Agreement to transfer to Weinstein, as a result of Weinstein’s ownership of the Debtor, the Debtor’s cash by charging the Debtor above-market rates in the Distribution Agreement instead of the net revenues that could be obtained if the Distribution Agreement reflected market terms and industry norms.”</p>\n<p>Agreements which are overly-biased in favour of one of the parties are more likely to be terminated early, or result in financial difficulties for the ‘junior’ party.</p>\n<p><a href=\"http://www.hollywoodreporter.com/thr-esq/weinstein-hit-130-million-fraud-795903\" target=\"_blank\" rel=\"nofollow noopener\">Read the article here.</a></p>\n<h3>Takeaway:</h3>\n<ul>\n<li>One sided distribution agreements are less likely to succeed.</li>\n</ul>","frontmatter":{"title":"Exorbitant Fees Leads to Demise of Distributor","date":"September 22, 2015","description":"This article is about a lawsuit alleging fraud by the supplier, who controlled the distributor, in the form of exorbitant distribution fees.","author":{"id":"rajah@cobaltcounsel.com","first":"Rajah","last":"Lehal","bio":"Rajah Lehal is Founder and CEO of Clausehound.com.  Rajah is a legal technologist and technology lawyer who is, together with the Clausehound team, capturing and sharing lawyer expertise, building deal negotiation libraries, teaching negotiation in classrooms, and automating negotiation with software.","image":{"childImageSharp":{"fluid":{"base64":"data:image/jpeg;base64,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","aspectRatio":1,"src":"/static/d7bbad08c257f3987a4a5710553e9e17/bdd4d/Rajah.jpg","srcSet":"/static/d7bbad08c257f3987a4a5710553e9e17/2b9ee/Rajah.jpg 80w,\n/static/d7bbad08c257f3987a4a5710553e9e17/e5d64/Rajah.jpg 160w,\n/static/d7bbad08c257f3987a4a5710553e9e17/bdd4d/Rajah.jpg 320w,\n/static/d7bbad08c257f3987a4a5710553e9e17/6e63d/Rajah.jpg 400w","sizes":"(max-width: 320px) 100vw, 320px"}}}},"tags":["Costs and Expenses","Distribution Agreement","Commercial Activities","Rajah"]}}},"pageContext":{"slug":"/exorbitant-fees-leads-to-demise-of-distributor/","previous":{"fields":{"slug":"/what-can-be-included-in-marriage-contracts/"},"frontmatter":{"title":"What Can be Included in Marriage Contracts?","tags":["Purpose","Marriage Contract","Commercial Activities","Rajah"],"author":{"id":"rajah@cobaltcounsel.com","first":"Rajah","last":"Lehal"}}},"next":{"fields":{"slug":"/asset-purchase-may-be-conditional-on-satisfactory-inspection-report/"},"frontmatter":{"title":"It never hurts to take a look at the assets after the deal is closed.","tags":["Asset Purchase Agreement","Inspection","Commercial Activities","Rajah"],"author":{"id":"rajah@cobaltcounsel.com","first":"Rajah","last":"Lehal"}}}}}}