Opinion ID: 474191
Heading Depth: 3
Heading Rank: 2

Heading: The Duress Argument

Text: 49 Mostek's alternative argument on the merits, that the 1985 QPA and the order for the twenty memory testers are void for duress, amounts to a broad assertion that Teradyne took advantage of Mostek's weak financial condition and used its position, as Mostek's only source of supply, to force Mostek to sign the QPA and to place the new order. Mostek also points to the pressure exerted on it by Chitowski, back in February 1985, to pay cancellation charges for cancelling two of the laser systems previously ordered by telephone. Teradyne now concedes that these charges were not due because cancellation charges were only assessable against written purchase orders. 50 Mostek's allegations of undue pressure exerted on it by Teradyne are rebutted to some extent by Teradyne's account of the facts which indicates that Mostek entered the 1985 QPA voluntarily in order to obtain discounts on its 1984 orders and that it ordered the twenty memory testers of its own accord. But, even if the facts were as Mostek alleges, it is not clear that it has made out a prima facie case of economic duress. 51 It is well established that not all economic pressure constitutes duress, see Automatic Radio Mfg. Co. v. Hazeltine Research, Inc., 176 F.2d 799, 804 (1st Cir.1949), aff'd, 339 U.S. 827, 70 S.Ct. 894, 94 L.Ed.2d 1312 (1950). The elements of duress under Massachusetts law, which both sides rely on in their briefs, are clearly set out in International Underwater Contractors, Inc. v. New England Telephone and Telegraph Co., 8 Mass.App. 340, 393 N.E.2d 968 (1979). The court there held that a party alleging economic duress must show: (1) that it involuntarily accepted the terms of the other side; (2) that circumstances permitted no other alternative; and (3) that said circumstances were the result of coercive acts of the opposite party. 393 N.E.2d at 970. The court stressed that [m]erely taking advantage of another's financial difficulty is not duress, that the person alleging financial difficulty must allege that it was contributed to or caused by the one accused of coercion, and the assertion of duress must be proved by evidence that the duress resulted from defendant's wrongful and oppressive conduct and not by plaintiff's necessities. Id. (quoting Williston, Contracts Sec. 1617 at 708, W.R. Grimshaw Co. v. Nevil C. Withrow Co., 248 F.2d 896, 904 (8th Cir.), cert. denied, 356 U.S. 912, 78 S.Ct. 669, 2 L.Ed.2d 585 (1958)). There is no indication here that Teradyne caused or contributed to Mostek's financial difficulties. Indeed, Mostek itself concedes that its difficulties came about as a result of a downturn in the semiconductor industry. Accordingly, we see no abuse of discretion in the trial court's conclusion that Teradyne had shown a likelihood of success on the merits. 52 Affirmed.