Graham Construction Services, Inc. v. Hammer & Steel Inc., 755 F.3d 611

Graham leased drilling equipment from Hammer & Steel (H & S) for a project in Parshall, ND; the project required a 96-foot-deep shaft and drilling equipment; the equipment allegedly performed unsatisfactorily, leading Graham to sue and H & S to countersue; the lease included limitations disclaiming reliance and installation/maintenance responsibility.
The Kelly bar/two subsequent breaks caused the 60-inch auger to fall and remain at the shaft bottom, forcing Graham to abandon the shaft and re-drill with another rig.
Graham alleged negligent misrepresentation and other contract-based claims; H & S asserted breach of contract, unjust enrichment, warranties, and value of the lost auger.
The district court denied JMOL on several claims; the jury awarded Graham $420,194.40 for negligent misrepresentation and H & S $197,238 for breach of contract, plus $52,387 for the auger loss.
On appeal, the Eighth Circuit vacated the misrepresentation award and remanded on the contract-related issues for potential new trials, applying Missouri law and the economic loss doctrine.
The court explicitly noted that mitigation and unclean-hands considerations could affect damages on remand.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the economic loss doctrine bars Graham’s negligent misrepresentation claim	Graham argues tort recovery is allowed for negligent misrepresentation	H & S argues Missouri law bars purely economic losses in tort	Yes; the doctrine bars the negligent misrepresentation claim
Whether equitable estoppel bars H & S’s breach of contract claim	Graham argues equitable estoppel applies	H & S argues estoppel does not apply; issue not preserved for JMOL	No; district court did not err in this respect (no JMOL on estoppel)
Whether the district court properly instructed on equitable estoppel	Graham contends an estoppel instruction was warranted	H & S contends the theory was not properly presented	The district court did not err; error not preserved given withdrawal of the general estoppel instruction
Whether the district court abused its discretion by not instructing on mitigation	Graham sought mitigation instruction indicating Graham’s conduct could reduce damages	H & S argues no such instruction was appropriate	Yes; abuse of discretion; remand for a new damages trial limited to mitigation issues
Whether unclean hands bars H & S’s auger-claim	Graham argues unclean hands bars the auger claim	H & S contends auger claim sounds in contract, not tort	No; unclean hands does not bar contract-based auger claim; remand for mitigation assessment on damages

Dannix Painting, LLC v. Sherwin-Williams Co., 732 F.3d 902 (8th Cir. 2013) (economic-loss doctrine bars commercial buyers from negligent-misrepresentation recovery)
Autry Morlan Chevrolet Cadillac, Inc. v. RJF Agencies, Inc., 332 S.W.3d 184 (Mo. Ct. App. 2010) (economic loss doctrine limits tort recovery for purely economic damages)
Dakota Gasification Co. v. Pascoe Bldg. Sys., a Div. of Amcord, Inc., 91 F.3d 1094 (8th Cir. 1996) (taxonomic discussion of economic loss doctrine in contract settings)
Captiva Lake Invs., LLC v. Ameristructure, Inc., 436 S.W.3d 619 (Mo. Ct. App. 2014) (economic loss doctrine application in Missouri proceedings)
Weisgram v. Marley Co., 528 U.S. 440 (1999) (remedies under mistaken-identity and proper judgment as a matter of law)
Harvey v. Timber Res., Inc., 37 S.W.3d 814 (Mo. Ct. App. 2001) (mitigation and damages in contract actions)
Day v. Toman, 266 F.3d 831 (8th Cir. 2001) (Rule 50 timing and preservation for JMOL)
Conseco Fin. Servicing Corp. v. N. Am. Mortg. Co., 381 F.3d 811 (8th Cir. 2004) (preservation of arguments for JMOL)