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Mark Andy, Inc. v. Heat Technologies, Inc.

United States District Court, E.D. Missouri, Eastern Division

April 3, 2015

MARK ANDY, INC., Plaintiff,
v.
HEAT TECHNOLOGIES, INC., Defendant.

MEMORANDUM AND ORDER

CATHERINE D. PERRY, District Judge.

Mark Andy makes printing press equipment. Heat Technologies builds dryers for printing presses. In 2013, Mark Andy hired Heat Technologies to make a custom dryer system for a printing press it was building for third-party customer CL&D. The dryer system was delivered and installed, but Mark Andy alleges it never worked properly. This lawsuit followed. In the second amended complaint, Mark Andy brings claims for breaches of contract and warranties (express and implied) against Heat Technologies relating to the functionality of the dryer system. Heat Technologies brings counterclaims for breach of contract.

Before me now are cross-motions for partial summary judgment. The parties want me to decide as a matter of law which contract terms control the present dispute. Because genuine disputes of material fact remain as to when a contract was formed and what terms were included in the contract, I must deny all pending motions for the reasons stated below.

Standards Governing Summary Judgment

The standards for summary judgment are well settled. In ruling on summary judgment, the Court views the facts and inferences therefrom in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). The moving party has the burden to establish both the absence of a genuine issue of material fact and that it is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Once the moving party has met this burden, the nonmoving party may not rest on the allegations in its pleadings but must set forth by affidavit or other evidence specific facts showing that a genuine issue of material fact exists. Fed.R.Civ.P. 56(e). At the summary judgment stage, I will not weigh the evidence and decide the truth of the matter, but rather I need only determine if there is a genuine issue for trial. Anderson, 477 U.S. at 249; ASi Industries GmbH v. MEMC Electronic Materials, Inc., 2008 WL 413819, *1 (E.D. Mo. Feb. 13, 2008).

Background Facts[1]

On January 2, 2013, Bruce Murphy of Mark Andy sent an email to Gene Plavnik of Heat Technologies requesting a bid for the CL&D dryer system. To accurately prepare a bid, Heat Technologies first asks potential customers to provide it with specific information about the project. Murphy did this by completing Heat Technologies' Design Criteria Form and including it as an attachment to his email.

On January 26, 2013, Heat Technologies sent a proposal for the dryer system to Mark Andy ("the Proposal"). The Proposal is attached as Exhibit 1 to the second amended complaint. The Proposal states that it is an "offer" that will remain open for 30 days and contains specifications for the dryer system, purchase price ($292, 700.00), payment terms (three payments per specified events), and shipping (FOB Atlanta). The Proposal also contains written warranties titled "Performance Warranty, " "Limited Equipment Warranty, " and "Limited Component Warranty." The Proposal states that these warranty obligations "expire immediately and completely if there are any alterations to the equipment during the warranty period." The Proposal also disclaims any other express and implied warranties not set out in the Proposal and excludes consequential and other damages and remedies to the extent allowed by Georgia law. Plavnik sent the Proposal to Murphy as an attachment to an email which notes that "[the Proposal] has a clause of performance warranty."

On January 30, 2013, Mark Andy issued a purchase order to Heat Technologies for the purchase of the CL&D dryer system ("Purchase Order"). The Purchase Order is attached as Exhibit 2 to the second amended complaint. The Purchase Order incorporates by reference Mark Andy's "Standard Terms and Conditions, " which are available online. It further states that "SELLER AGREES THAT THIS PURCHASE ORDER WILL BE GOVERNED BY SUCH STANDARD TERMS AND CONDITIONS... BY SELLING GOODS/SERVICES TO MARK ANDY, YOU AGREE TO, AND INTEND TO BE BOUND BY SUCH STANDARD TERMS AND CONDITIONS...." Mark Andy's Standard Terms and Conditions include the following provision:

Acceptance of this Order is expressly made conditional on assent to the terms, provisions and conditions of this Order which cannot be altered by the shipment or receipt of any Goods contemplated by this Order... Seller's shipment of the Goods or its execution of the acknowledgment copy of this instrument shall constitute acceptance of all of the terms, provisions and conditions herein set forth, and said terms, provisions and conditions shall constitute the entire contract between the parties, no additional or different terms, provisions or conditions contained in a written expression or confirmation of acceptance by Seller shall become a part of the contract even though such expression or confirmation of acceptance states that it is expressly made conditional on assent to such additional or different terms, provisions or conditions.

The Standard Terms and Conditions state as follows with respect to warranties:

In addition to any warranty implied by fact or law, Seller expressly warrants that the Goods covered by this Order are free from defects in design, materials and workmanship, conform strictly to specifications, drawings and samples, if any, are fit and sufficient for the purpose intended, are merchantable, do not infringe on any patent, trademark, copyright or other intellectual property right of any third party, and are conveyed to Buyer free and clear of all liens, claims and encumbrances... Acceptance of this Order shall constitute an agreement upon Seller's part to indemnify and hold Buyer harmless from liability, loss, damage and expenses, including special, incidental and consequential damages, and including reasonable counsel fees, incurred or sustained by Buyer by reason of the failure of the Goods to conform to such warranties or by reason of the negligence or willful misconduct by Seller... Such indemnity shall be in addition to any other remedies provided by law... All warranties shall survive inspection, tests, acceptance of and payment by Buyer. In the event of breach of warranty, Buyer may at its option either return for full refund or credit or require prompt correction or replacement of the defective non-conforming Goods... In the event Seller refuses to promptly correct the defective or non-conforming Goods... Buyer may upon reasonable notice to Seller make the repairs necessary to correct said Goods and charge Seller with the costs of repair.

Page two of the Purchase Order, under "Item/Part Number/Description, " states that "this order is defined by the proposal from Heat Technologies, Inc., titled (CL&D Project) dated January 26, 2014. 1 × Spectra HETM Ultra Drying System for 17 web width in line flexographic press, 10 colors per specifications described in proposal noted above." The Purchase Order contains a delivery date and delivery instructions, payment terms (three payments per specified events), shipping terms (FOB Origin) and instructions, billing instructions, and purchase price ($292, 700.00). The final payment is "due upon acceptance as per terms of Performance Warranty." "Performance Warranty" is not defined in the Purchase Order or the Standard Terms and Conditions. The only "Performance Warranty" in the record appears in Heat Technologies' Proposal.

Murphy then emailed Plavnik the same day to ask, "Have you receive[d] [the Purchase Order]?" Plavnik responded by email, "Thank you and yes, we have received the new order and will schedule a conference call with the engineering team within this week. We look forward to continuing to work together." Plavnik testified that after receiving the Purchase Order, he called Murphy "to discuss the purchase order, including the reference to Mark Andy's Terms and Conditions. During my call with Mr. Murphy, I told that him that my understanding of the purchase order was based on [Heat Technologies'] proposal and warranties, not Mark Andy's Terms and Conditions, and ...


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