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Analysts International Corp. v. Recycled Paper Products, Inc.

United States District Court for the Northern District of Illinois
1987 WL 12917 (1987)


Facts

Recycled Paper Products, Inc. (RPP) (defendant) hired Analysts International Corporation (AIC) (plaintiff) to develop and implement a custom computerized system for reordering merchandise. The only written record of the agreement between RPP and AIC was a letter that referred to a certain date for system delivery. AIC’s system was not completed on time and, when implemented, did not perform any of the system’s intended functions. AIC attempted to fix the system, while RPP continued to pay AIC’s invoices. RPP’s independent auditors then determined that the system would have to be entirely redone. RPP refused to pay an outstanding AIC bill. AIC sued RPP for breach of contract and fraud. RPP counterclaimed for, among other things, breach of the implied warranties of merchantability and fitness for a particular purpose. AIC moved for summary judgment on RPP’s breach-of-warranty claims, arguing that the contract with RPP was one for services, not goods, and that the implied warranties under the Uniform Commercial Code (UCC) §§ 2-314 and 2-315 therefore did not apply.

Rule of Law

Issue

Holding and Reasoning (Grady, J.)

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