Yale law professor Ian Ayres examines Austin Instrument v. Loral, the classic contract law case about economic duress. Loral held a Navy contract to build radar sets and depended on Austin Instrument as its sole subcontractor for precision gears; when Austin threatened to stop deliveries unless Loral agreed to a price increase, Loral paid under protest and later sued to recover the money. Ayres uses the case to work through the formation defense of duress, distinguishing a wrongful threat from ordinary hard bargaining and asking what makes a counterparty's lack of alternatives legally significant. The lecture is part of Ayres' Coursera-based American Contract Law course, covering special controls on promissory liability alongside undue influence. Short and doctrinal, it walks through the facts, the court's reasoning, and the test for economic duress that the case established.