In Austin Instrument v. Loral Corp., 29 N.Y.2d 124, 272 N.E.2d 533, 324 N.Y.S.2d 22, rearg denied 29 N.Y.2d 749 (1971), the United States Navy had awarded Loral a $6 million contract for the production of radar sets. The contract contained a schedule of deliveries, a liquidated damages clause applying to late deliveries, and a cancellation clause in the event of Loral's default. Austin was a winning bidder subcontractor that made precision gear components that Loral required to produce the radar sets. Thereafter, the Navy awarded Loral a second contract for the production of additional radar sets. Austin informed Loral that it would cease deliveries of the parts unless Loral consented to substantial increases in the prices provided for in the parties' agreement, both retroactively and prospectively. After contacting 10 manufacturers of precision gears, and finding none that could timely produce the parts, Loral acceded to Austin's demand. The Court of Appeals found that Austin's threat to stop deliveries unless the prices were increased deprived Loral of its free will, thereby rendering the contract to pay the increased prices voidable. Loral's failure to meet its delivery requirements to the government could have had catastrophic economic consequences for it, including substantial liquidated damages and the cancellation of future deliveries to the government -- the entity with which Loral did a substantial portion of its business. The Court noted that a mere threat by one party to breach a contract by not delivering the required items, though wrongful, does not, in itself, constitute economic duress.