A federal court applying Illinois law concluded that a term sheet developed in mediation was not an enforceable settlement agreement because key terms were missing and there was no clear indication that the parties intended the term sheet to be enforceable, rather than just an agreement to agree. The court noted that the term sheet had been hastily developed through a mediator’s proposal at the end of a long day, with the mediator shuttling between the parties and no direct communication over the terms. The court also considered the behavior of the parties after the mediation, as neither side promptly reported to the court that the case had been resolved as is typical when settlement has been achieved.
Craftwood Lumber Co. v. Interline Brands, Inc., No. 11 C 4462
(U.S.D.C. N.D. Ill., September 23, 2014).
