## Facts

- Wooster Republican Printing Co., a closely held media and printing business, agreed in writing to buy substantially all assets and the business of Channel Seventeen, Inc., which operated a UHF television station (ABC affiliate) in Columbia, Missouri.
- The deal was structured as an asset sale excluding certain liquid assets (bank accounts, cash on hand, and accounts receivable).
- The contract included (1) a liquidated-damages provision limiting the seller’s breach liability to $50,000, and (2) an express specific-performance provision stating the buyer would have no adequate remedy at law.
- After the agreement, Channel Seventeen (and its controlling shareholder, Tapeswitch Corp. of America, later added as a defendant) refused to perform, and Wooster sued in diversity for specific performance or, alternatively, damages.
- Defendants asserted defenses and counterclaims, including that the sale lacked required shareholder approval under Missouri law, that Wooster failed to place $50,000 into escrow, and that specific performance was barred by the liquidated-damages clause or by impossibility.
- A key asset dispute involved the transmitter tower site: Channel Seventeen held a lease and an option to purchase the property, not fee title; Wooster offered to accept assignment of the lease and option with a price adjustment.
- Following a bench trial, the court entered judgment for Wooster, ordered specific performance, and denied defendants’ counterclaims, Tapeswitch’s cross-claim, and a third-party claim against Channel Seventeen’s president.

## Issues

1. Whether the parties formed a binding, enforceable asset-purchase contract despite alleged noncompliance with Missouri statutory shareholder-approval requirements for selling substantially all corporate assets.
2. Whether specific performance was available where the contract also contained a $50,000 liquidated-damages provision.
3. Whether claimed impossibility based on the seller’s leasehold/option interest in the transmitter tower site barred specific performance.
4. Whether Wooster’s alleged failure to deposit $50,000 into escrow excused defendants’ nonperformance or barred equitable relief.
5. Whether defendants’ counterclaims and related claims established grounds for rescission or damages defeating Wooster’s claim.

## Decision

- The court found an enforceable contract for sale of Channel Seventeen’s assets and business.
- The court ordered specific performance in Wooster’s favor.
- The liquidated-damages clause was not treated as an exclusive remedy and did not bar specific performance.
- The alleged impossibility regarding the tower site did not defeat relief; the decree could require conveyance of the seller’s actual interests (leasehold and option) with an equitable purchase-price adjustment.
- The asserted escrow deficiency did not preclude relief, particularly in light of defendants’ repudiation.
- Defendants’ counterclaims, Tapeswitch’s cross-claim, and the third-party claim were denied.

## Legal Principles

- Specific performance may be ordered for the sale of a unique business where damages are inadequate and the contract contemplates equitable relief.
- A liquidated-damages provision does not necessarily displace specific performance; it may cap legal damages without waiving an expressly preserved equitable remedy.
- Technical defects in corporate-approval processes under an asset-sale statute do not automatically render a contract void as between contracting parties, depending on the statute’s purpose and the case context.
- Impossibility does not bar specific performance when the seller can convey its actual interest and equity can adjust terms (including price) to match the interest conveyed.
- A buyer’s technical noncompliance with an escrow-related term may be nonmaterial and insufficient to excuse a seller’s repudiation.

## Conclusion

The court enforced the television-station asset-sale agreement and granted specific performance, holding that the station’s uniqueness and the contract’s express equitable-remedy provision supported relief, while the $50,000 liquidated-damages clause, asserted corporate-approval defects, claimed impossibility tied to a leasehold tower site, and an alleged escrow shortfall did not defeat enforcement.


Wooster Republican Printing Co. v. Channel Seventeen, Inc., 533 F. Supp. 601 (W.D. Mo. 1981)