Babcock & Wilcox Co. v. Hitachi America, Ltd.

The Babcock & Wilcox Company (B&W) (plaintiff) needed a catalyst for a system it was designing. B&W began negotiating with Hitachi America, Ltd. (Hitachi) (defendant) in June 1999, sending Hitachi a quotation request. Several proposals were exchanged through December 1999. On December 9, 1999, Hitachi sent B&W a detailed proposal that listed specific terms, such as price, delivery date, payment terms, warranties, and liability limitations. It invited B&W to respond with questions or comments. B&W and Hitachi continued to negotiate several terms, including price. Terms were settled in June 2000, and B&W issued a purchase order to Hitachi on June 15, 2000. The purchase order stated that it was an offer, not an acceptance. It contained additional warranties more extensive than those in Hitachi’s 1999 proposal. No further negotiations took place, and Hitachi shipped the catalyst in 2001. When Hitachi refused to address issues with the catalyst, B&W sued Hitachi for breach of contract and breach of warranties. The parties agreed that they had a contract, but they disputed when the contract was formed and consequently what terms it included. Hitachi argued that its 1999 proposal constituted an offer and it was accepted by B&W’s 2000 purchase order. Because the purchase order’s terms conflicted with the proposal, Hitachi argued there was a battle of the forms to be decided under the Uniform Commercial Code. In contrast, B&W argued that the 2000 purchase order constituted the offer and it was accepted by Hitachi’s shipment of the catalyst, meaning that there was no battle of the forms and the purchase order’s terms governed. B&W and Hitachi both moved for partial summary judgment.