Patrick: What are some types of people that you’ve really been able to help? I’d like to hear some stories, because there’s nothing that tells people more about what you do than a couple of good stories.
Cleve: There’s one client who is in the electronics manufacturing business. It’s a small industry, small number of available customers, and it was not uncommon for them to have a customer come in, make big promises of big orders and want a low price. In order to deliver the price they need to deliver inventory. They need to purchase inventory in quantity so they too could in turn pass over the reduced price and the customer would intentionally (or unintentionally) end up with the large order that would not be filled, leaving my client with an unusually large amount of inventory which was then burning against their line of credit. Tough situation.
Over time in a long time of representing this particular client, I’ve persuaded them to enter to a manufacturing services agreement. The purpose of which was to sit down with the customer on the front end to eliminate what’s often called in the Uniform Commercial Code a “battle of forms.” I send you a request for purchase, you send back to me a purchase order, I send back to you the invoice and so forth. Each one of those documents takes precedence over the other.
In this particular case, the customer and my client agreed that they would enter to the manufacturing services agreement. The master agreement would control whatever the form said. The result of which was one of the clients that the customers that my client had had an inventory run up of over $750,000, and because of the services agreement they were able to persuade their customer that they needed to repurchase the inventory to the tune of three quarter of a million dollars. It was very successful, and it was done without the necessity of litigation. In fact, I really didn’t even get involved.
http://www.lrmlaw.com/ 214.922.8910 1601 Elm Street, Suite 4600
Dallas, TX 75201 Cleve Clinton is an Lawyer that works with Mavericks... folks that play big, plan big and get into big messes.
