Marketing Store Worldwide v. Wild Planet Entertainment: A Settlement Doesn't Always Mean It's Over

In Chicago breach of contract cases, attorneys must always prepare for the possibility of a trial.

However, our Chicago business lawyers know that the majority of these cases will not go before a jury and will instead result in a settlement agreement. This allows both sides to avoid the cost, time and other expenses incurred by taking a case to trial. It also may allow one side to avoid formally accepting responsibility, while still covering the damages inflicted to the other party.

But even when settlements are reached, that's not always the end of the story.

Such was the case with The Marketing Store Worldwide v. Wild Planet Entertainment, heard recently by a federal judge in the U.S. District Court for the Northern District of Illinois, Eastern Division.

The case was first brought by the marketing firm, referred to in court documents as "TMSW." The firm claimed that Wild Planet, a manufacturer of educational children's toys, had refused to make payments on more than $1.42 million worth of invoices that had been issued prior to the June 4 filing date.

An amended complaint was filed a week later, but Wild Planet neither filed an Answer or entered an appearance in the case.

In early August, both parties agreed to a settlement. That settlement indicated that Wild Planet would have to cover the debt owed. As a material condition of the agreement, Wild Planet would have to secure intellectual property rights and licensing from third-party Sega, in order that TMSW could effectuate an inventory sale.

In early September, TMSW filed for dismissal with prejudice. This essentially means that TMSW would not legally be allowed to bring the matter before the court again, so long as Wild Planet held up its end of the bargain. The order was signed by the judge on Sept. 11. Still, the court maintained jurisdiction over the case for the course of the next 120 days, during which time the issues outlined in the settlement were to be addressed.

However, as the plaintiff's Sept. 26th motion states, no payments have been submitted by Wild Planet. Additionally, Wild Planet had failed to secure intellectual property rights from Sega, as agreed. As such, the plaintiffs request a judgement for the agreed-upon amount, of $1.42 million, plus all accrued and unpaid finance charges. At this point, that brings the total damages to $1.44 million, with a set penalty for every month in which the defendant does not adhere to the agreement.

Signed affidavits from the plaintiff's executives are offered as proof of the non-payment. Wild Planet has yet to issue an answer, and the judge has yet to respond to the request.

Although the dismissal with prejudice prevents the marketing firm from bringing the issue before the court again in a separate action, they are still able to seek relief from the court when the terms of the settlement agreement are not met.

Our Chicago business lawyers know that a settlement agreement approved by a judge is considered court-ordered. As such, both parties must adhere to it. When one side attempts to skirt that obligation, attorneys for the opposition have a responsibility to pursue just recourse.

Jeremy A. Gibson & Associates is a law firm dedicated to business litigation in Chicago and elsewhere in Illinois. Call 877-452-4529 for a free consultation.

Additional Resources:
The Marketing Store Worldwide, LP, vs. Wild Planet Entertainment Inc., U.S. District Court for the Northern District of Illinois, Eastern Division, Justia Case Law