Packgen v. Berry Plastics Corporation

973 F. Supp. 2d 48 (2013)

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Nature of the Case

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Facts

P sued D alleging breach of contract, breach of express warranty, breach of implied warranty of fitness for a particular purpose, breach of implied warranty of merchantability, and negligence. P manufactures intermediate bulk containers used by petroleum refineries for the transportation and storage of fresh and spent catalyst. On September 25, 2007, P sent D a purchase order for 61-inch laminated polypropylene foil. On November 26, 2007, P sent a purchase order to D requesting 48-inch laminated polypropylene. In the second half of November 2007, D told P that everything was all set with the purchase order for the 61-inch laminated polypropylene and that D had ordered the raw materials. On November 28, 2007, D sent P an e-mail concerning the purchase orders for the 61-inch laminated polypropylene and the 48-inch laminated polypropylene. The 61' order will be shipping on 12/7 and be ready to ship to P on 17th or 18th. The 48' order has not yet been scheduled for production. On December 13, 2007, D sent P an update by email: the 61' will likely ship by Monday/Tuesday and the 48' still has not shipped from Mexico. The 61-inch laminated polypropylene was received by P on December 27, 2007. On December 28, 2007, D sent P an invoice for the 61-inch material by regular, first class U.S. Postal Service mail. D attached its standard terms and conditions to the invoice. Prior to its September 25, 2007 order, on at least seven occasions when P ordered, no terms and conditions were attached or included with D's invoices. On January 17, 2008, D updated the 48-inch laminated polypropylene by email: The 48' order is in slitting and will be ready to ship tomorrow, and we estimate an ETA delivery to D on Monday, 1/21. Berry shipped the 48-inch order on January 18, 2008, and P received it on January 21, 2008. On January 21, 2008, D mailed the invoice, which included D's Terms and Conditions. The front of the invoice stated, 'all sales are subject to the standard terms and conditions attached herewith.' The Terms and Conditions contained a provision stating that 'to the extent, it may apply,' the limitations period in Indiana's statute of limitations is reduced to one year. The earliest date that P would have received the invoice for the 61-inch laminated polypropylene by mail is January 2, 2008. The earliest date that P would have received the invoice for the 48-inch laminated polypropylene by mail is most likely January 24, 2008. On February 11, 2008, P submitted two non-conformance reports identifying alleged defects in the products. P claims it was not aware before the failure of Berry's goods that D's terms and conditions contained a provision reducing the statute of limitations period for claims to one year. P did not expressly agree to the terms and conditions attached to D's invoices. On December 9, 2011, P filed suit and D motioned for summary judgment as per the terms of its invoices. P claims that D accepted its purchase order offers either (a) when it purchased raw materials and began production or (b) when it shipped the finished goods to P; Since D's 'terms arrived after the contracts were formed, P's purchase orders govern the terms of the transactions between the parties . . . [and] the four-year limitations period controls. The Court finds that D accepted P's offer within a reasonable time. P contends, the parties did not form valid contracts under section 2-207(1); rather, they formed their contracts under section 2-207(3). P argues that even if the Court determines the parties' contract was formed under section 2-207(1), D's statute of limitations term does not apply because it materially alters the contracts. P claims it was surprised by D's reduced statute of limitations term because it was inconspicuous-stapled to the back of the invoice-and D never alerted P to the term. P asserts that 'a reasonable merchant cannot be presumed to have consented to the greatly reduced limitations period. D argues that even if the contracts were formed when it shipped its terms and conditions still become part of the contract under section 2-207(2) as a confirmation sent after the goods are shipped. Because P did not seasonably object to D's terms and conditions, it argues that 'the additional terms included in the invoices, even if sent after shipment of goods, must be analyzed under UCC § 2-207 rather than some other provision of the UCC.