168th and Dodge, LP v. Rave Reviews Cinemas, LLC

Property developers Red Development and 168th and Dodge (plaintiffs) worked with theater operator Rave Reviews Cinemas (defendant) on a development project. After the developers proposed including a theater, they bought extra land and sent letters of intent. The defendant's president said he agreed with most major issues but needed board approval, and the parties signed a second letter of intent that expressly stated it was neither a lease nor an option to lease, only a description of terms for any future agreement. The defendant signed but again stressed it needed board approval. After the city approved the project, lease negotiations broke down and the defendant abandoned the theater. The developers contracted with another operator and sued for breach of express and implied contract and promissory estoppel. The district court dismissed the express-contract claim and granted summary judgment on the rest; the developers appealed.

Whether an indefinite preliminary agreement that merely outlines the terms of a potential future agreement is sufficient to form a binding contract.