Crown Battery Mfg. Co. v. Club Car, Inc.

Crown Battery Mfg. Co. v. Club Car, Inc.

Opinion

ORDER

This is a dispute regarding the type of contract plaintiff Crown Battery Manufacturing Company (Crown) entered into with defendant Club Car, Inc. (Club Car or CCI). Crown argues Club Car breached a requirements contract that obligated Club Car to purchase batteries from Crown. Club Car contends there was no breach of contract because the contract was not a requirements contract, and it had no obligation under the contract to purchase anything from Crown.

Pending is Club Car's motion for partial summary judgment. (Doc. 29).

For the reasons that follow, I grant defendant's motion.

Background

Having discussed the facts in an earlier decision, Crown Battery Co. v. Club Car, Inc., 2013 U.S. Dist. LEXIS 148794, 2013 WL 5670950 (N.D. Ohio), , I recite only the facts relevant to this motion.

In September, 2009, Crown entered  [*2] into the contract at issue, denominated as the Strategic Supply Agreement (SSA), to provide batteries for Club Car's golf carts and utility vehicles. Beginning in January, 2010, per the SSA, Crown was manufacturing over 12,000 batteries each week. Crown delivered the batteries to its warehouse, from which Club Car would take batteries as needed.

Regarding the quantity of batteries, the SSA provides:

Quantity Obligation. CROWN agrees to sell and timely deliver Products to CCI at its designated location as set forth in individual purchase orders or blanket orders (each and "Order") accepted by CROWN throughout the Term of this Agreement in the quantity requirements that will be communicated through CCI's Supplier Advantage supplier interface system ("Supplier Advantage") with real-time updates (EDI System). It is understood by the Parties that, commencing January 15, 2010, CROWN shall manufacture not less than twelve thousand (12,000) units of Product during each calendar week for the Term of the Agreement. CCI shall have the first right of refusal for the first such twelve thousand (12,000) units each week. If CCI does not place an Order with respect to any portion of such weekly twelve  [*3] thousand (12,000) units at least four weeks prior to such week ("Declined Volume"), Crown is free to sell the Declined Volume to another customer. The Parties further agree to review CROWN's capacity capabilities from time to time during the Term. In times when Crown is unable to supply all of its customers' requirements at the same time, CROWN agrees to use its best efforts to supply CCI's requirements, but in no event shall it supply CCI with more than its pro rata portion of any given Product as determined by CCI's total annual spend vis-a-vis that specific Product by Crown's other customers. No quantity obligations shall be imposed upon CCI unless specifically detailed in the attached Exhibit A; provided, however, in no event shall any such obligations be in effect during a period in which CROWN has been issued a Notice to Cure or Notice of Termination.

(SSA ¶ 2(B), Doc. 29-2, at 2-3).

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