Zoltek Corp. v. Structural Polymer Group, No. 08-3928.

CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)
Writing for the CourtRiley
Citation592 F.3d 893
Docket NumberNo. 08-3928.
Decision Date26 January 2010
PartiesZOLTEK CORPORATION, Appellant, v. STRUCTURAL POLYMER GROUP; Gurit (UK) Ltd., Appellees.
592 F.3d 893
ZOLTEK CORPORATION, Appellant,
v.
STRUCTURAL POLYMER GROUP; Gurit (UK) Ltd., Appellees.
No. 08-3928.
United States Court of Appeals, Eighth Circuit.
Submitted: September 24, 2009.
Filed: January 26, 2010.

[592 F.3d 894]

Fernando Bermudez, argued, Martin M. Green, on the brief, St. Louis, MO, for appellant.

Thomas C. Walsh, argued, Louis F. Bonacorsi, James M. Weiss, James F. Bennet, on the brief, St. Louis, MO, for appellee.

Before MURPHY, BRIGHT, and RILEY, Circuit Judges.

RILEY, Circuit Judge.


Zoltek Corporation (Zoltek) appeals the district court's1 dismissal of its fraud claim against Structural Polymer Group and its subsidiary Gurit (UK) Ltd. (collectively, SP). Zoltek argues the district court erred in holding Missouri's economic loss doctrine barred Zoltek's fraud claim. We affirm.

I. BACKGROUND

In November 2000, Zoltek, a manufacturer of carbon fiber, and SP, a user of carbon fiber, entered into a ten-year supply agreement (requirements contract) in which the parties agreed Zoltek would supply all of SP's requirements of large filament count carbon fiber. Large filament count carbon fiber contains 48,000 or more filaments per bundle, while the superior quality, but more expensive, small filament count carbon fiber contains fewer filaments per bundle. In 2000, most manufacturers used small filament count carbon fiber. Zoltek and SP intended to develop a new market for less expensive large filament count fiber in the wind-energy industry. In 2000, 2001, and 2002, SP purchased Zoltek's large filament count carbon fiber product, Panex 33, under the requirements contract. In 2002, Zoltek stopped manufacturing Panex 33 in favor of its new large filament count carbon fiber product Panex 35. SP ordered no Panex 33 or 35 in 2003. SP ordered and received Panex 35 in 2004, and placed orders for 2005 and 2006.

The parties became embroiled in a dispute over whether the requirements contract covered both Panex 33 and Panex 35. On February 22, 2005, SP sued Zoltek in the district court for breach of contract, attaching the requirements contract to its complaint. SP sought lost profits through December 31, 2006, and future lost profits through December 31, 2010, based on Zoltek's failure to supply large filament count carbon fibers to SP. The case went to trial on November 6, 2006. In the course of the proceedings SP's expert witness testified, and Zoltek now alleges falsely represented, SP would purchase the maximum allowable quantity of 2,038 tons of large filament count carbon fiber in 2008, 2,491 tons in 2009, and 2,945 tons in 2010-a total of 7,474 tons during the three years. David Schofield, SP's Chief Corporate Development Officer, later repeated these representations to Zsolt Rumy, Zoltek's Chief Executive Officer. After a fourteen-day trial, the jury found for SP and awarded damages for lost profits, but no damages for future lost profits. The district court entered judgment in SP's favor for $21,138,518. Zoltek appealed, and this court affirmed on October 8, 2008. See Structural Polymer Group, Ltd. v. Zoltek Corp., 543 F.3d 987, 1001 (8th Cir.2008).

Zoltek filed this action against SP in Missouri state court on March 6, 2008,

592 F.3d 895

claiming breach of the same requirements contract and alleging fraud based upon SP's representations during the first trial, which amounted to a commitment to purchase Zoltek's carbon fiber from 2008 to 2010. Zoltek alleged it invested over $77 million to meet SP's future orders. SP removed the case to the federal district court on April 4, 2008. The district court granted SP's motion to dismiss, holding (1) nothing in the requirements contract required SP to accept unfilled orders once the parties terminated the agreement, and (2) Missouri's economic loss doctrine barred Zoltek's recovery on its fraud claim. Zoltek now appeals the district court's dismissal of its fraud claim.

II. DISCUSSION

"This court reviews de novo the grant of a motion to dismiss, `taking all facts alleged in the complaint as true.'" Charles Brooks Co. v. Ga.-Pac., 552 F.3d 718, 721...

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