Article Date: 02/15/2023

Liquidated Damages/Economic Disincentive Clause Ruled Unenforceable

U.S. Court of Appeals for the Fifth Circuit

The Hanover Insurance Company v. Binnacle Development, LLC

Case no.: 21-40662

Date filed: January 12, 2023

Overview

A federal appeals court has ruled that an “economic disincentive” clause “look[ed] like a liquidated-damages provision” and was therefore an unenforceable penalty under Texas law.

Background

Binnacle Development LLC awarded contracts to R. ... Log in to view the full text.

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