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Roth Steel Prods. v. Sharon Steel Corp. - 705 F.2d 134 (6th Cir. 1983)

Rule:

In determining whether an amended complaint states a claim, the court must accept all factual allegations contained in the pleading as true, and resolve all factual ambiguities in favor of the party who sought the amendment. Finally, the court notes that a motion under Fed. R. Civ. P. 12(b)(6) is directed solely to the complaint itself. Consequently, extrinsic evidence cannot be considered in determining whether the complaint states a claim. 

Facts:

Plaintiffs, Roth Steel Products Company (Roth Steel) and Toledo Steel Tube Company (Toledo Steel), asserted a breach of contract and sought damages from Defendant Sharon Steel Corporation (Sharon Steel), which counterclaimed for damages on rejected goods. Sharon Steel had modified a prior price quote to Roth Steel and Toledo Steel after market conditions changed. Both parties appealed the judgment from the trial court.

Issue:

Did the amended complaint state a claim?

Answer:

Yes

Conclusion:

The court held that there was an enforceable oral contract for the sale of goods. The court also held that unforeseen economic exigencies existed, which allowed Sharon Steel's modification to avoid a loss and found the district court's findings to the contrary were clearly erroneous. The court then found that because Roth Steel and Toledo Steel were required to provide Sharon Steel with notice of breach regarding the price increases, they bore the burden of demonstrating that prompt and adequate notice of breach was given and this issue was remanded for further factual determination.

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