Corrugated Paper Products v. Longview Fibre Co.,

868 F.2d 908 (7th Cir. 1989)

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Nature of the Case

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Facts

Corrugated (P) and Longview (D) are manufacturers of cardboard and other paper products. Atlas buys and sells used equipment and P notified Atlas that it was interested in purchasing a used cut-off knife. Atlas got a letter from D indicating that it had a used cut-off knife for sale. Atlas and D discussed the sale of the knife to Atlas and D wanted assurances that Atlas would buy the knife for its own account and that D was not interested in the fact that Atlas may or may not have a potential customer for the used knife. Atlas discussed the specs of the knife with P and even had an employee of P visit D to see the knife in operation. As a result of that visit, P and Atlas entered into a written contract for the purchase of the knife and a deposit of $5,000. Atlas then sent a purchase order to D for the knife with a check in the amount of $5,000 and directions to ship the knife F.O.B. to P's plant. D again asked assurances of Atlas that the knife was being purchased for Atlas' own account and that the deal was not contingent on the sale to P or anyone else. Shipping to P was delayed because of D's inability to secure satisfactory replacement machinery On September 10, 1984, Atlas sent D a modified purchase order directing the equipment be sent to a different buyer. P then learned the knife would not be shipped to P. P sued both Atlas and D for breach of contract. P got summary judgment against Atlas and the court entered summary judgment in favor of D in that P was not a third-party beneficiary. P appealed.