## Facts

- Alliance Laundry Systems, LLC manufactured commercial laundry equipment and bought stainless steel from Thyssenkrupp Materials, N.A., through its Ken-Mac Metals division.
- The parties had a written supply arrangement covering July 1, 2005 through December 31, 2006 under which Alliance issued purchase orders and Ken-Mac typically signed and returned the orders with or before shipment.
- During the 2005–2006 relationship, Alliance became delinquent on payments, and Ken-Mac repeatedly sought payment to avoid stopping shipments.
- After the supply arrangement ended, Ken-Mac held surplus stainless steel made to Alliance’s specifications (“leftover steel”).
- In March 2007, Alliance and Ken-Mac exchanged emails about Alliance purchasing the leftover steel; Ken-Mac asked for a purchase-order number, and Alliance sent a purchase order on March 23, 2007.
- Ken-Mac did not sign and return the March 23 purchase order and did not ship the leftover steel.
- Alliance made partial payments on its past-due balance and also began purchasing steel from another supplier.
- Ken-Mac determined Alliance was not creditworthy and sold the leftover steel to another buyer.
- Alliance sued for breach of contract, moved for summary judgment, and Thyssenkrupp opposed and moved to compel discovery.

## Issues

1. Whether the March 2007 emails and purchase order created an enforceable UCC contract for sale of the leftover steel, including under UCC statute-of-frauds requirements.
2. If a contract existed, whether the parties’ course of dealing and standard terms allowed Ken-Mac to withhold delivery and sell elsewhere based on insecurity about Alliance’s financial condition and delinquency.
3. Whether factual disputes on formation and terms precluded summary judgment and warranted further discovery.

## Decision

- Alliance’s motion for summary judgment was denied.
- Thyssenkrupp’s motion to compel discovery was granted.
- The court held that a reasonable jury could find either that no contract was formed or that any contract incorporated terms permitting Ken-Mac to withhold shipment due to credit insecurity.

## Legal Principles

- Under UCC Article 2, whether communications between merchants (including emails and purchase orders) form a contract depends on context and evidence of mutual assent, including established transactional practices.
- UCC statute-of-frauds enforceability and any exceptions often turn on disputed facts about the parties’ writings, confirmations, and performance.
- Course of dealing may supply or modify contract terms, including credit, default, and insecurity-related shipment provisions, if supported by the parties’ prior transactions.
- Summary judgment is improper where material factual disputes exist about contract formation or the content and incorporation of governing terms.

## Conclusion

Because the record allowed competing inferences about whether the parties intended to be bound without Ken-Mac’s signed return of the purchase order and, alternatively, whether prior dealing supplied terms permitting nonshipment upon credit insecurity, the court denied summary judgment and compelled further discovery.


Alliance Laundry Sys., LLC v. Thyssenkrupp Materials N.A., 570 F. Supp. 2d 1061 (E.D. Wis. 2008)