case study

649 F. Supp. 2d 757 United States District Court for the Southern District of Ohio, 2009
CASE SUMMARY
Facts: CCB Ohio specializes in upgrading power lines in a way that makes it possible to offer broadband service over an electrical grid. Chemque manufactures Q-gel.
Transformers reduce the 100,000 or more volts flowing through a typical power line to the 120 volts that actually arrive at the outlets in your home. But unfortunately, transformers completely block digital signals. And so, to offer broadband over an electrical grid, data must take a detour around transformers. Couplers allow for this detour.
CCB and its contractors purchased Q-gel. This substance was supposed to create a waterproof seal that would bind newly installed couplers to power lines. Unfortunately, the gel did not gel, at least not for long. Within 18 months, 40 percent of CCB Ohio’s couplers were leaking liquefied Q-gel. Ultimately, 90 percent of the couplers throughout the Cincinnati area leaked and caused millions of dollars in losses.
CCB Ohio sued for breach of warranty. Chemque argued that it had disclaimed all implied warranties by giving CCB a specification sheet that read, “All information is given without warranty or guarantee.” Chemque moved for summary judgment.
Issue: Should Chemque’s motion for a summary judgment on CCB’s warranty claims be granted?
Decision: No, the motion for summary judgment should not be granted.
Reasoning: In this state, companies that sell consumer goods may not disclaim implied warranties. However, the contract at issue here does not involve consumer goods.
To disclaim implied warranties for other kinds of transactions, the seller must show that the buyer actually received the disclaimer and that it was so conspicuous, a reasonable person would have noticed it. There is no evidence in the record that CCB did get the specification sheet in question. The company also argues that, even if it did receive the sheet, the disclaimer was not clear and conspicuous.
With these significant issues in dispute and unresolved, it would be inappropriate to grant Chemque’s motion for summary judgment.
Motion for summary judgment denied.