## Facts

- Dr. Carey W. Frix, a Tennessee physician, provided mobile mammography services from a trailer equipped with medical imaging equipment, including a CT scanner.
- Wanting to upgrade the trailer’s imaging capabilities, Frix sought a vendor to (1) remove an existing four-slice CT scanner, (2) transport and install a 64-slice CT scanner in the trailer, and (3) provide and install additional mammography-related equipment.
- Frix solicited bids from three medical-equipment companies. Integrity Medical Systems, Inc., a Florida-based dealer of medical imaging equipment, submitted the lowest bid.
- Before Frix accepted the bid, Frix and Integrity had informal discussions about the deal. The parties later agreed that these discussions and communications resulted in a contract.
- Frix contended he accepted Integrity’s bid and confirmed the essential terms by email with Integrity’s owner. Integrity later relied on a written “Purchase Agreement” containing additional terms favorable to Integrity.
- Integrity offered no evidence that Frix ever saw, signed, or otherwise agreed to the Purchase Agreement terms. Integrity argued that UCC principles still allowed those terms to bind Frix.
- After the transaction broke down, Frix sued Integrity in the United States District Court for the Western District of Tennessee (diversity jurisdiction) for breach of contract.
- Frix moved for partial summary judgment on liability for breach of contract, leaving damages for later proceedings.

## Issues

1. Did the parties’ contract include Integrity’s later-sent Purchase Agreement terms when Frix never saw or signed that document?
2. Was Frix a “merchant” under UCC Article 2 such that Integrity could treat its Purchase Agreement as binding through UCC rules on additional or different terms?
3. Under the terms of the contract actually formed by the parties, was Integrity liable for breach of contract as a matter of law on partial summary judgment?

## Decision

- The court granted Frix’s motion for partial summary judgment on liability for breach of contract.
- The court held that Integrity’s Purchase Agreement did not govern because Integrity failed to show Frix assented to it, and the parties’ agreement arose from their bid-related communications and acceptance.
- The court rejected Integrity’s argument that Frix should be treated as a UCC “merchant” and charged with knowledge of (and bound by) terms he never received or accepted.
- The court concluded that, applying the contract terms established by the parties’ actual agreement (not the Purchase Agreement), the undisputed facts showed Integrity breached the contract; the case proceeded on damages and related issues.

## Legal Principles

- A contract for the sale of goods (and related services) may be formed through bid, acceptance, and confirming communications showing agreement on essential terms.
- A seller’s unilateral, later-issued form containing additional or different terms does not become part of the contract without a basis for incorporation (such as actual assent or a UCC mechanism that applies on the proved facts).
- Under UCC Article 2, “merchant” status depends on the party’s occupation and knowledge or skill regarding the goods or practices involved; buying specialized equipment for use in one’s business does not automatically make the buyer a merchant for that type of equipment.
- Summary judgment on breach-of-contract liability is proper when the governing contract terms can be determined as a matter of law and no genuine dispute of material fact exists as to breach.

## Conclusion

In Frix v. Integrity Medical Systems, Inc., the court held that the parties’ contract was based on the bid and the parties’ communications—not Integrity’s later, unsigned Purchase Agreement—and that Frix was not a UCC merchant who could be bound to unseen boilerplate; applying the terms actually agreed upon, the court granted partial summary judgment holding Integrity liable for breach of contract while leaving damages for later proceedings.


Frix v. Integrity Medical Systems, Inc., 2017 WL 4171987 (2017)