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Jonibach Management Trust v. Wartburg Enterprises, Inc.
750 F.3d 486
5th Cir.
2014
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Background

  • From 2003 to 2010, Bumbo sold plastic baby seats to Wartburg, which distributed to major retailers, with no written contract.
  • Relationship deteriorated due to Wartburg’s payment issues and Bumbo’s move to a different distributor.
  • On February 25, 2010, Bumbo sued Wartburg for specific performance and sought TRO and preliminary injunction to force distribution to three retailers.
  • The district court granted the TRO, finding a clear course of dealing suggesting an enforceable oral distribution agreement.
  • Wartburg counterclaimed for breach of contract, fraud, and quantum meruit; the district court later dismissed the fraud and quantum meruit claims.
  • Three contract counterclaims remained: (i) refusal of sale, (ii) customer relationships, and (iii) retailer limitation; the district court granted summary judgment based on a later oral modification and the statute of frauds.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Whether the district court properly granted summary judgment on the later-modification claims. Wartburg argues the claims stem from the initial contract; the modification is unproven but not barred by frauds. Bumbo contends the claims arise from a later oral modification and are barred by the statute of frauds. Partly yes; the refusal of sale and customer relationships claims are barred, but retailer limitation survives.
Whether Wartburg’s retailer limitation claim but not barred by the statute of frauds. Retailer limitation stems from the initial contract and should be enforceable under an exception to the statute of frauds. Summary judgment on this claim should be upheld if it relies on the later modification and statute of frauds. Remanded; retailer limitation claim arises from the initial contract; statute-of-frauds exception applies, requiring factual review.
Whether the retailer limitation claim is properly grounded in the initial contract as asserted in the preliminary injunction. The restriction to certain retailers was the subject of the injunction and thus part of the initial contract. The injunction findings are not binding on the merits and do not prove a current contract limitation. Affirmed in part and remanded in part; retailer limitation exists under the initial contract and falls within the statute-of-frauds exception.

Key Cases Cited

  • Karaha Bodas Co. v. Negara, 335 F.3d 357 (5th Cir. 2003) (preliminary injunction standards and preservation of positions)
  • University of Texas v. Camenisch, 451 U.S. 390 (U.S. 1981) (purpose/limits of preliminary injunctions; findings not binding at trial)
  • Meineke Disc. Muffler v. Jaynes, 999 F.2d 120 (5th Cir. 1993) (scope of preliminary injunction findings)
  • Antoine v. First Student Inc., 713 F.3d 824 (5th Cir. 2013) (summary judgment standards and burden of proof)
  • Hugh Symons Group, plc v. Motorola, Inc., 292 F.3d 466 (5th Cir. 2002) (statutory writing requirement for contract for sale of goods)
Read the full case

Case Details

Case Name: Jonibach Management Trust v. Wartburg Enterprises, Inc.
Court Name: Court of Appeals for the Fifth Circuit
Date Published: Apr 24, 2014
Citation: 750 F.3d 486
Docket Number: 13-20308
Court Abbreviation: 5th Cir.