Court Rules on Contract Renewal

In a unanimous decision, the Tennessee Supreme Court ruled Tuesday that a contract between parties that share provisions similar to a previous contract does not necessarily constitute a renewal of the earlier agreement. The Chattanoogan reports the opinion was based on the case of BSG LLC versus Check Velocity in which BSG referred Weight Watchers to Check Velocity. Weight Watchers and Check Velocity entered into an “Electronic Check Recovery Agreement” during which Check Velocity paid BSG fee residuals. BSG filed suit against Check Velocity when the contract ended and Check Velocity and Weight Watchers entered into another, similar agreement but did not continue to pay BSG fee residuals. The court ruled in favor of Check Velcocity stating the new agreement was not a renewal of the first agreement.