JSW Steel USA Ohio, Inc. v. Marubeni-Itochu Steel Am., Inc.
| Decision Date | 29 November 2021 |
| Docket Number | Case No. 2:20-cv-3415 |
| Citation | 573 F.Supp.3d 1212 |
| Parties | JSW STEEL USA OHIO, INC., Plaintiff, v. MARUBENI-ITOCHU STEEL AMERICA, INC., Defendant. |
| Court | U.S. District Court — Southern District of Ohio |
Michael A. Roberts, Graydon Head & Ritchey LLP, Cincinnati, OH, Thomas A. Prewitt, Graydon Head & Richey, Ft. Mitchell, KY, for Plaintiff.
Steven C. Coffaro, Collin L. Ryan, Keating Muething & Klekamp, PLL, Cincinnati, OH, for Defendant.
The parties, JSW Steel USA Ohio, Inc. ("Plaintiff") and Marubeni-Itochu Steel America, Inc. ("Defendant"), have filed cross motions for summary judgment. ECF Nos. 14 & 15. For the following reasons, Defendant's motion is DENIED, and Plaintiff's motion is GRANTED IN PART.
Plaintiff is a steel manufacturing company with a manufacturing plant in Mingo Junction, Ohio. Compl. ¶ 6, ECF No. 3. Defendant is a steel and aluminum processor based in New York. Tanaka Decl. ¶ 3, Def.’s Mot. Ex. A, ECF No. 15-1 ("Tanaka Decl."); Compl. ¶ 2, ECF No. 3. Before negotiating the order at issue, Defendant had purchased products from Plaintiff on one prior occasion. Compl. ¶ 7, ECF No. 3.
The parties began negotiating the steel order at issue on February 19, 2020. Raimondi Decl. 30–31, Pl.’s Mot. Ex. A, ECF No. 14-1("Raimondi Decl."); Tanaka Decl. 33, ECF No. 15-1. They went back and forth negotiating various terms, including the price, quantity, size, grade, and delivery details of a proposed order. Tanaka Decl. 20–33, ECF No. 15-1. Plaintiff's representative mentioned three times during these conversations that he would need to get internal approval for an order. Raimondi Decl. 21–22, 24, ECF No. 14-1.
On March 3, 2020, a phone conversation took place between the parties. Id. at 19. Following that conversation, the same day, Defendant emailed Plaintiff, "per [the] phone instruction, we accept net 45 days ...." Id. In that same email, Defendant said "[f]ollowing are details of our P[urchase] O[rder]" followed by details for three "lots" including delivery, shipment, and payment terms. Id. Plaintiff replied to that email saying, Id. The next morning, Plaintiff followed up, informing Defendant that one of the steel sizes would not work, asking, "Do you want to add something else or just cancel this line?" Id. at 18. Plaintiff did not attach an acknowledgment form to that email and instead wrote, "We will send acknowledgment after your confirmation." Id.
The emails reflect that the parties also had a phone conversation the morning of March 4, 2020. Id. at 17. Then, Defendant emailed a response about the steel sizes not working, giving new numbers for the order. Id. Plaintiff responded on March 5, 2020, saying "Thank you for the update we have updated the tonnage for that line 12 from 220 to 286" to which Defendant replied, "Thank you very much for your confirmation." Id. at 16–17. The parties continued to make modifications on March 5, 2020, and March 6, 2020, with Defendant emailing requests and Plaintiff confirming the changes were made both times. Id. at 10–13.
Then, on March 9, 2020, Defendant sent Plaintiff an email with three attached "Purchase Confirmation and Contract" documents. Id. at 9–10, Ex. B. Plaintiff responded the next day with three "acknowledgment" documents. Id. at 9, Ex. C. Both parties acknowledge that Plaintiff's documents and Defendant's documents contained different terms and conditions, with "[Plaintiff's] terms being seller-friendly and [Defendant's] terms being buyer-friendly." Pl.’s Mot. 10, ECF No. 14; Def.’s Mot. 5, ECF No. 15.
The parties went back and forth regarding which documents the other would be willing to sign. Defendant asked for its "Purchase Confirmation and Contract" documents to be signed and returned on March 9, 2020, March 10, 2020, and March 12, 2020. Raimondi Deck 7–9, ECF No. 14-1. On March 12, 2020, Plaintiff responded to Defendant's requests, writing:
Thank you for your time on the phone. As discussed, we do not sign the PO from customers but we do send our acknowledgment with terms and conditions. Can you go through our acknowledgments and let us know if there is any concern on the acknowledgment. Even last time with your order we did not sign your PO. We just sent our acknowledgment. Let us know if the above works. If not we will have to involve our general coun[sel] and they will have to discuss with your coun[sel] and then we can proceed to sign.
Id. at 7. On March 18, 2020, Defendant responded to Plaintiff's email asking, "Would you please be kind enough to advise us what is wrong with our PO?" Id. at 6.
Without a response from Plaintiff, on March 23, 2020, Defendant informed Plaintiff that it would no longer be moving forward with the order, specifically that it was "no longer able to honor such 3 [purchase orders] due to [Plaintiff's] rejection of signatory in spite of [Defendant's] repeated requests." Id. at 4–5. Also in that email, Defendant noted that COVID had an impact on the company and that although the price of crude oil was $47.25 at the time the parties "negotiated a business," it had since decreased to $22.92. Id. at 5. Defendant also said that while it was "hearing of order cancellations throughout the country," it would be willing to "cooperate but [would] need to adjust the pricing." Id.
Plaintiff responded that it could not accept Defendant's rejection, as the proposed order had already been halfway produced, with the first barge leaving for delivery the next day. Id. at 3–5. Defendant answered that it would "stand on [it's] cancellation based on [Plaintiff's] failure to sign [Defendant's documents]." Id. at 1–2. When Defendant refused to accept the goods, Plaintiff resold the product to different buyers for a loss. Pl.’s Mot. 6, ECF No. 14.
In its Complaint, Plaintiff asserts two causes of action: (1) breach of contract; and (2) declaratory judgment. Compl. ¶¶ 45–54, ECF No. 3. The parties have now filed cross motions for summary judgment. ECF Nos. 14 & 15. This matter has been fully briefed and is ripe for review.
The standard governing summary judgment is set forth in Federal Rule of Civil Procedure 56(a), which provides: "The court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a).
The Court must grant summary judgment if the opposing party fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial. Celotex Corp. v. Catrett , 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986) ; see also Van Gorder v. Grand Trunk W. R.R., Inc. , 509 F.3d 265, 268 (6th Cir. 2007).
When reviewing a summary judgment motion, the Court must draw all reasonable inferences in favor of the nonmoving party, who must set forth specific facts showing there is a genuine dispute of material fact for trial, and the Court must refrain from making credibility determinations or weighing the evidence. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) ; Pittman v. Cuyahoga Cty. Dept. of Children and Family Serv. , 640 F.3d 716, 723 (6th Cir. 2011). The Court disregards all evidence favorable to the moving party that the jury would not be required to believe. Reeves v. Sanderson Plumbing Prods., Inc. , 530 U.S. 133, 150–51, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000). Summary judgment will not lie if the dispute about a material fact is genuine, "that is, if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (internal citations and quotation marks omitted); see also Barrett v. Whirlpool Corp. , 556 F.3d 502, 511 (6th Cir. 2009).
The Court is not "obligated to wade through and search the entire record for some specific facts that might support the nonmoving party's claim." InterRoyal Corp. v. Sponseller , 889 F.2d 108, 111 (6th Cir. 1989). The Court may rely on the parties to call attention to the specific portions of the record that demonstrate a genuine issue of material fact. Wells Fargo Bank, N.A. v. LaSalle Bank N.A. , 643 F. Supp. 2d 1014, 1022 (S.D. Ohio 2009).
This action was removed from Ohio state court under this Court's diversity jurisdiction; therefore, Ohio substantive law applies. See Erie R.R. Co. v. Tompkins , 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). Article 2 of the Uniform Commercial Code, as adopted by Ohio, applies to transactions involving the sale of goods and, accordingly, governs the claims in this case. The Court will address each of Plaintiff's causes of action in turn.
The essential elements of a breach of contract claim are: (1) the existence of a contract; (2) performance by the plaintiff; (3) the defendant's breach; and (4) damages or loss to the plaintiff. Kline v. Mortg. Elec. Registration Sys., Inc. , No. 16-3932, 2017 WL 3263745, at *8 (6th Cir. Aug. 1, 2017) (citing Siemaszko v. FirstEnergy Nuclear Operating Co. , 187 Ohio App. 3d 437, 444, 932 N.E.2d 414 (Ohio Ct. App. 2010) ). In this case, the element at issue is whether a contract existed between the parties.
A valid contract arises as the result of an offer, acceptance, the manifestation of mutual assent, and consideration.
Kostelnik v. Helper , 96 Ohio St.3d 1, 770 N.E.2d 58, 61 (2002). It becomes binding the moment the offer is accepted. Dyno Const. Co. v. McWane, Inc. , 198 F.3d 567, 572 (6th Cir. 1999) (citing Helle v. Landmark, Inc. , 15 Ohio App. 3d 1, 8, 472 N.E.2d 765 (Ohio Ct. App. 1984) ).
The parties disagree about whether a contract was formed. Plaintiff argues that a contract formed on ...
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