The Delaware Chancery Court has refused to dismiss a claim that an unsigned technology license term sheet bearing a legend that its terms were non-binding was nonetheless an enforceable contract. The court found that a material issue of fact existed as to whether the parties entered into a binding licensing agreement.

The court focused on the course of dealing between the parties after the term sheet had been drafted. In particular, the parties collaborated on product development and entered into an agreement obligating the parties to negotiate in good faith to agree upon a definitive license agreement in accordance with the term sheet. The claim was filed after one of the parties refused to negotiate the definitive license agreement due to certain terms no longer being economically favorable.

PharmAthene, Inc. v. SIGA Technologies, Inc., C.A. No. 2627-VCP (Del Ch. Nov. 23, 2010)