United States v. Wegematic Corp.

360 F.2d 674 (1966)

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Nature of the Case

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Facts

Wegematic (D) entered into a contract with the Federal Reserve Board to deliver 5 general-purpose electronic digital computing systems. The delivery was to be within nine months from the date of contract award on June 30, 1957. Liquidated damages of $100 per day for delay were part of the contract and also a liability cancellation clause. The units were never delivered, and The Federal Reserve Board contracted with IBM to deliver a IBM 650 computer at a rental of $102,500 and at a purchase option of $410,450. The contract with D had a price tag of $231,800. The Federal Reserve Board sued D for damages under the delay clause for $46,300 and $179,450 for the excess cost of the IBM equipment and $10,056 for preparatory expenses. That totaled $235,806 with 6% interest from October 6, 1958, to which the court awarded The Federal Reserve Board. D appealed.