BorgWarner PDS Irapuato S. de R.L. de C.V. v. Parker Hannifin Corp.

Mexican company BorgWarner PDS Irapuato S. de R.L. de C.V. (BorgWarner) (plaintiff) manufactured automobile clutches. BorgWarner requested a quote from Ohio company Parker Hannifin Corporation (Parker) (defendant) about buying a clutch part. In February 2021, Parker sent a price quote stating that (1) BorgWarner could accept the quote by placing an order within 60 days, (2) any sale was expressly conditioned on BorgWarner accepting Parker’s terms, (3) the quote was “tentative and subject to change” if BorgWarner’s purchase order differed from the quantity assumptions or other assumptions in its quote request, and (4) Parker could increase prices for future orders after reasonable notice. BorgWarner responded with a letter of intent. Parker crossed out a paragraph requiring acceptance of BorgWarner’s terms, signed the letter, and sent it back. After additional discussions regarding logistics, BorgWarner submitted a purchase order. This order stated that (1) Parker’s acceptance of the order was conditioned on acceptance of BorgWarner’s terms, (2) Parker would provide all the parts BorgWarner needed, and (3) Parker could not raise prices without BorgWarner’s approval. Parker acknowledged the order but stated that any agreement was subject to Parker’s terms and provided another copy of those terms. Parker then began shipping parts to BorgWarner, and BorgWarner paid for them. When Parker’s supply costs increased dramatically a few months later, Parker notified BorgWarner that Parker’s prices were also increasing. BorgWarner refused to pay the increase. For months, the parties attempted to negotiate a resolution. Ultimately, BorgWarner sued Parker in federal district court, with each party claiming that its version of the contract terms governed the dispute. The district court granted summary judgment to Parker, finding that its quote was an offer and that BorgWarner had accepted this offer by placing a purchase order. BorgWarner appealed.