## Facts

- A window-and-door manufacturer bought and used a supplier’s wood preservative for components incorporated into products sold from 1985 to 1988.
- The supplier responded to purchase orders with acknowledgment forms stating on the front that acceptance was limited to the acknowledgment’s terms; a fine-print limitation-of-liability clause on the back capped liability at the purchase price of the preservative.
- The buyer did not sign the acknowledgment’s signature line.
- Years later, the buyer experienced premature rot and deterioration in treated window and door frames.
- The buyer sued on contract and warranty theories, asserting that the preservative failed and that the supplier provided a warranty extending to future performance.
- A jury found a warranty of future performance, breach, and substantial damages (including lost profits and goodwill), and the district court entered judgment exceeding $156 million.

## Issues

1. Whether a limitation-of-liability clause on the back of a merchant’s acknowledgment form became part of the contract under U.C.C. § 2-207, or was a material alteration requiring the buyer’s express assent.
2. Whether the supplier made an enforceable warranty explicitly extending to future performance, permitting accrual upon discovery and defeating limitations defenses.
3. Whether the district court abused its discretion under Daubert and Federal Rule of Evidence 702 by admitting the buyer’s expert testimony on breach and causation.
4. Whether the evidence supported the jury’s causation and damages findings, including damages beyond the preservative’s purchase price.

## Decision

- The court held the limitation-of-liability clause did not become part of the contract because it materially altered the bargain and the buyer did not expressly assent.
- The court upheld the jury’s finding of a warranty of future performance and rejected the supplier’s limitations defenses.
- The court affirmed admission of the buyer’s expert testimony, treating most objections as attacks on factual foundation affecting weight, not admissibility.
- The court largely affirmed the judgment and refused to reweigh the jury’s credibility and damages determinations.

## Legal Principles

- Under U.C.C. § 2-207, additional terms in a confirmation between merchants do not become part of the contract if they materially alter the agreement; a substantial limitation of remedies or damages may constitute a material alteration requiring express assent.
- A warranty claim may accrue upon discovery when the warranty explicitly extends to future performance, rather than accruing at tender of delivery.
- Under Daubert and Rule 702, disputes over an expert’s factual basis ordinarily go to credibility and weight for the jury, not admissibility, so long as the methodology is sufficiently reliable and the trial court’s gatekeeping is reasonable.
- Appellate review is deferential to the jury’s resolution of competing expert testimony and factual disputes when supported by evidence in the record.

## Conclusion

The Eighth Circuit held that a fine-print damages cap in the supplier’s acknowledgment materially altered the parties’ contract and was unenforceable absent express assent, upheld a future-performance warranty theory and the admission of expert causation testimony, and largely affirmed a jury verdict awarding substantial consequential damages.


Marvin Lumber & Cedar Co. v. PPG Indus., Inc., 401 F.3d 901 (8th Cir. 2005)