When a U.S. Business Breaches Your Trade Agreement: Critical Legal Options You Can Take

For many South American exporters, entering the U.S. market is a major milestone. It often involves months of negotiation, logistics planning, regulatory compliance, and trust built across borders. So, when a U.S. business fails to honor a trade agreement, whether by refusing payment, canceling orders without cause, or changing terms after delivery, the impact can be severe.

If someone in the U.S. has breached your trade agreement, you are not alone, and more importantly, you are not without legal options. This article explains what a breach of a trade agreement looks like under U.S. law, what steps South American exporters should take immediately, and how disputes with U.S. companies are actually resolved in practice.

What Counts as a Breach of a Trade Agreement Under U.S. Law?

A breach of contract occurs when one party fails to perform its obligations under an agreement without a valid legal excuse. In cross-border trade disputes, this often includes:

• Nonpayment or delayed payment for goods delivered
• Refusal to accept shipments that meet contractual specifications
• Unilateral termination of a distribution or supply agreement
• Price changes after performance has begun
• Failure to meet minimum purchase or volume commitments

Under U.S. law, a trade agreement does not need to be lengthy or overly formal to be enforceable. Signed contracts, purchase orders, master supply agreements, distribution agreements, and even a series of consistent emails and invoices can form a binding contract.

Do You Have the Right to Sue a U.S. Company From South America?

Yes, foreign companies regularly bring legal claims in U.S. courts. If the U.S. business is based in Florida, has assets in Florida, or agreed to Florida law or venue in the contract, Florida courts are often the proper forum. Even without a Florida clause, U.S. courts may still have jurisdiction depending on how the business relationship was structured.

South American exporters are often surprised to learn that U.S. courts are accustomed to handling international commercial disputes and that foreign plaintiffs are treated the same as domestic ones.

First Steps to Take After a U.S. Buyer Breaches a Trade Agreement

Before rushing into litigation, there are practical steps that can protect your position and strengthen your case.

Preserve All Trade and Payment Records

Save contracts, purchase orders, invoices, bills of lading, shipping confirmations, inspection reports, and all communications. These documents often matter more than the contract language itself.

Do Not Continue Performance Without Legal Advice

Continuing to ship goods or extend credit after a breach can weaken your leverage and complicate damage calculations.

Avoid Informal Settlements Without Counsel

Many exporters accept partial payments or vague promises that later undermine their legal claims. Any resolution should be documented properly.

Governing Law and Venue Clauses Matter More Than You Think

One of the first things a U.S. litigation attorney will review is the governing law and venue clause in your agreement.

These provisions determine:

• Which country’s law applies
• Where a lawsuit must be filed
• Whether arbitration is required

If your agreement specifies U.S. law or Florida courts, that usually simplifies enforcement. If the contract is silent, courts will analyze factors such as performance location, payment routing, and the buyer’s principal place of business.

Can You Recover Damages From a U.S. Company?

In many cases, yes. Recoverable damages in U.S. breach of trade agreement cases may include:

• Unpaid contract amounts
• Lost profits from canceled orders
• Storage, shipping, and customs losses
• Interest and, in some contracts, attorney’s fees

U.S. courts also have strong mechanisms to enforce judgments, including liens, garnishment, and asset seizure. This is often a key advantage of litigating in the United States rather than abroad.

What If the U.S. Company Claims Quality or Compliance Issues?

This is one of the most common defenses raised by U.S. importers.

Courts will look closely at:

• Contractual quality standards
• Inspection and rejection timelines
• Whether the buyer accepted goods before objecting
• Whether alleged defects were documented properly

Under U.S. commercial law, buyers typically cannot accept goods and later refuse payment without timely and substantiated objections.

Litigation vs. Settlement: What Is Realistic?

Most international trade disputes resolve before trial, but not because the exporter lacks a case. They resolve because legal pressure works.

A well-prepared lawsuit often leads to:

• Structured payment plans
• Settlement for a reduced but recoverable amount
• Enforceable judgments when settlement fails

The key is credibility. U.S. companies take claims more seriously when they are backed by counsel experienced in commercial litigation and cross-border disputes.

Why South American Exporters Should Work With a U.S.-Based Litigation Firm

Cross-border disputes sit at the intersection of contract law, jurisdictional rules, and practical enforcement. A firm like ours, which is familiar with both U.S. litigation and international business realities, can anticipate issues before they become obstacles.

At Ayala Law, we regularly represent foreign companies in disputes involving U.S. buyers, distributors, and partners. We understand that for exporters, these cases are not abstract legal problems. They affect cash flow, reputation, and long-term market access.

Final Thought: A Breach of Your Trade Agreement Does Not Mean the Deal Is Lost

Many South American exporters assume that once a U.S. company breaches a trade agreement, there is little they can do from abroad. That assumption is often wrong. With the right legal strategy, exporters can enforce their rights, recover losses, and protect their position in the U.S. market.

If you believe a U.S. business has breached your trade agreement, contact an experienced attorney at 305-570-2208.

You can also email our attorney Eduardo directly at eduardo@ayalalawpa.com.

Don’t hesitate to schedule a case evaluation with us online here.

[The opinions in this blog are not intended to be legal advice. You should consult with an attorney about the particulars of your case]