420 F.3d 728 (7th Cir. 2005), 04-3100, PFT Roberson, Inc. v. Volvo Trucks North America, Inc.

Docket Nº:04-3100, 04-3232, 04-3841, 04-3877.
Citation:420 F.3d 728
Party Name:PFT ROBERSON, Inc., Plaintiff-Appellee, Cross-Appellant, v. VOLVO TRUCKS NORTH AMERICA, Inc., and Volvo Transportation Services, N.A., Inc., Defendants-Appellants, Cross-Appellees.
Case Date:August 25, 2005
Court:United States Courts of Appeals, Court of Appeals for the Seventh Circuit

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420 F.3d 728 (7th Cir. 2005)

PFT ROBERSON, Inc., Plaintiff-Appellee, Cross-Appellant,


VOLVO TRUCKS NORTH AMERICA, Inc., and Volvo Transportation Services, N.A., Inc., Defendants-Appellants, Cross-Appellees.

Nos. 04-3100, 04-3232, 04-3841, 04-3877.

United States Court of Appeals, Seventh Circuit.

Aug. 25, 2005

Argued May 2, 2005.

Steven H. Hoeft (argued), McDermott, Will & Emery, Chicago, IL, Jeffrey W. Tock, Harrington, Tock & Royse, Champaign, IL, for Plaintiff-Appellee, Cross-Appellant.

Wayne F. Plaza (argued), Charles A. LeMoine, Rooks Pitts, Robert K. Villa, Dykema Gossett, Chicago, IL, for Defendants-Appellants, Cross-Appellees.

Before BAUER, EASTERBROOK, and EVANS, Circuit Judges.

EASTERBROOK, Circuit Judge.

PFT Roberson operates a fleet of more than 1,200 long-haul trucks and trailers.

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Freightliner supplies, maintains, and repairs Roberson's vehicles under a fleet agreement. A "fleet agreement" is a comprehensive contract (or series of contracts) specifying the number of trucks, the price of each, how much maintenance costs per mile (a fee that increases as a truck ages and becomes more subject to breakdowns), trade-in and other repurchase details when trucks reach the end of their useful lives, and provisions for winding up the arrangement (the "exit clause"). Exit may be complex, for it can entail early and large-scale replacements, repurchases, or swaps of used trucks, as well as disputes about cause and penalties.

Late in 2001 Freightliner sent Roberson a termination notice, which activated the exit clause. Litigation erupted when the parties could not agree on how it worked; mean-while Roberson went shopping for another supplier and approached Volvo. The parties discussed a multi-year, $84 million arrangement for the purchase and maintenance of new Volvo trucks plus the trade-in or repair of used Freightliner trucks and trailers that Freightliner did not repurchase. Lengthy drafts were exchanged from November 2001 until late January 2002. Many "Master Agreements" were drafted; none was signed.

In March 2002 Roberson and Freightliner patched up their differences, settled the lawsuit, and extended their fleet agreement. Roberson then sued Volvo for breach of contract and fraud. According to Roberson, an email containing 572 words is the contract that Volvo breached, and the fraud consists in Volvo's efforts to negotiate additional or revised terms after sending the email. Volvo's email, dated December 6, 2001, and captioned "Confirmation of our conversation", recaps the negotiations' status. It identifies items that Roberson and Volvo had "come to agreement on" and others that the parties needed to "review and finalize."

Although the email states that the contract would be complete only when these other subjects had been resolved and the package approved by senior managers, the district judge held that a jury could find that the email constituted Volvo's assent to the items it mentioned even if a full fleet agreement had not been signed. At the trial, the judge allowed Roberson's managers to testify that they felt they had an agreement with Volvo. (The objection, which the district judge rejected, was that only words exchanged between the parties could create a contract and that private thoughts are irrelevant.) The jury awarded Roberson more than $5 million in damages for breach of contract. Volvo appeals the district court's denial of its motion for judgment as a matter of law under Fed.R.Civ.P. 50 and contends that it is entitled to a new trial if we reject this position. Roberson has filed a cross-appeal in pursuit of damages on its fraud theory, which the district judge did not submit to the jury.

According to the email, the parties "have come to agreement on" the number of new Volvo trucks that Roberson will purchase, the cost per mile of servicing the new trucks and some of the Freightliner trucks, and an outline of an exit clause. They had not agreed on the price per truck, on the cost per mile for all of the older trucks, on the repurchase and trade-in terms for older trucks, or on the details of the exit clause--and recall that the devil was in these details for the arrangement between...

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