## Facts

- Logical Choice Computers, Inc. (Logical) assembled and sold computer systems.
- On two occasions, Logical sold Microsoft-branded software that turned out to be counterfeit.
- Logical had purchased the software from two suppliers: Acecom, Inc. (Acecom) and Software & More, Inc. (Software & More).
- Microsoft Corporation (Microsoft), the software maker, sued Logical for federal infringement and related unfair-trade claims based on Logical’s sales of counterfeit Microsoft software.
- In response, Logical filed third-party claims against Acecom and Software & More, alleging breach of contract, breach of warranty against infringement, common-law fraud, and violations of the Illinois Consumer Fraud and Deceptive Trade Practices Act.
- Logical alleged that Acecom and Software & More represented the software as genuine Microsoft product.
- Logical did not otherwise contact Acecom or Software & More to complain about the software or to state an intent to seek a remedy before filing the third-party complaints.
- Acecom moved to dismiss the third-party claims, arguing that Logical was barred from any remedy because Logical failed to give notice of breach as required by U.C.C. § 2-607(3)(a).
- Logical responded that Acecom (and Software & More) received the required notice through service of the third-party complaints.

## Issues

1. Whether a buyer’s service of a third-party complaint can satisfy U.C.C. § 2-607(3)(a)’s requirement that the buyer notify the seller of breach within a reasonable time after discovery (or when it should have discovered) the breach.

## Decision

- The court held that Logical’s third-party complaints provided sufficient notice of breach under U.C.C. § 2-607(3)(a).
- The court therefore rejected Acecom’s argument that Logical’s third-party claims were barred for lack of notice and denied dismissal on that ground.

## Legal Principles

- Under U.C.C. § 2-607(3)(a), a buyer who has accepted goods must, within a reasonable time after it discovers or should have discovered a breach, notify the seller of the breach or be barred from any remedy.
- The notice requirement is satisfied if the seller is reasonably informed that the buyer views the transaction as involving a breach and that the buyer may pursue a remedy; the notice need not include detailed legal theories or a full statement of damages.
- Depending on content and timing, service of a complaint (including a third-party complaint) may constitute the notice required by § 2-607(3)(a).

## Conclusion

Because Logical’s third-party complaints alerted the suppliers that Logical claimed a breach arising from the sale of purportedly genuine Microsoft software and that Logical sought relief, the court treated the pleadings as adequate U.C.C. § 2-607 notice and allowed Logical’s warranty and related third-party claims to proceed despite the absence of earlier, separate communication to the sellers.


Microsoft Corporation v. Logical Choice Computers, Inc., 42 U.C.C. Rep. Serv. 2d 727 (2000)