Compumedics USA, Inc. v. Capital Partners Financial Group USA, Inc.
5:16-cv-00522
| W.D. Tex. | Mar 25, 2019Background
- Capital Partners purchased two sleep study systems from Compumedics via purchase orders for Spring Central Hospital and Humble Surgical Hospital; combined price $97,624.61.
- Compumedics shipped systems and sent invoices that adjusted pricing and included standard terms on the back of each invoice.
- Capital Partners never paid; Compumedics sued for breach of contract and moved for summary judgment.
- Capital Partners disputed contract formation and performance, asserting Compumedics failed to complete installations and left equipment largely boxed.
- Court found offer and acceptance occurred (purchase orders + shipment/invoices) and invoices’ additional terms incorporated except forum-selection/choice-of-law clauses.
- Court concluded a genuine factual dispute exists whether Compumedics fully performed its contractual installation obligations, so summary judgment was denied without resolving damages.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a binding contract formed | Compumedics: Purchase orders + shipment/invoices established contract for sale | Capital Partners: Disputes timing and effect of invoices; contests formation | Held: Contract formed when Compumedics shipped or mailed invoices; invoices’ added terms incorporated except forum/choice-of-law clauses |
| Whether invoices and their new terms (including price) became part of the contract | Compumedics: Invoices lowered price and added standard terms, which were proper under UCC § 2.207 | Capital Partners: Argued invoices came after shipment and disputed incorporation | Held: Under § 2.207 and merchant rule, invoices’ terms (and adjusted prices) applied, except material forum/choice-of-law clauses |
| Whether Compumedics fully performed (installation) | Compumedics: contends it performed by shipping and invoicing; argues acceptance occurred | Capital Partners: Presents evidence that installations were partial or not completed and equipment remained boxed | Held: Genuine dispute of material fact exists on Compumedics’s performance; cannot grant summary judgment for Compumedics |
| Damages resulting from alleged breach | Compumedics: seeks payment of invoice amounts | Capital Partners: contends nonpayment justified by incomplete performance | Held: Court did not decide damages because performance dispute precludes summary judgment |
Key Cases Cited
- Celotex Corp. v. Catrett, 477 U.S. 317 (summary judgment standard)
- Axelson, Inc. v. McEvoy-Willis, 7 F.3d 1230 (offer can be any act leading offeree reasonably to believe assent will conclude deal)
- Davis v. Fort Bend Cty., 765 F.3d 480 (opponent to summary judgment must produce evidence supporting reasonable verdict)
- Toshiba Mach. Co. v. SPM Flow Control, Inc., 180 S.W.3d 761 (purchase order without conditions may be an offer)
- Westech Eng’g, Inc. v. Clearwater Constructors, Inc., 835 S.W.2d 190 (acceptance can occur by shipping goods and sending invoice)
- Am. Heritage Life Ins. Co. v. Koch, 721 S.W.2d 611 (mailbox rule for acceptance)
- Associated Sawmills, Inc. v. Peterson, 366 S.W.2d 844 (when new terms materially change agreement)
- Frost Nat’l Bank v. Burge, 20 S.W.3d 580 (elements of breach of contract claim)
- Lemp v. Armengol, 26 S.W. 941 (court enforces parties’ clear contractual intentions)