Family Snacks of North Carolina, Inc. v. Prepared Products Co.
United States Court of Appeals for the Eighth Circuit
295 F.3d 864 (2002)
Family Snacks of North Carolina, Inc. (Family Snacks) (plaintiff) entered into a supply agreement with Prepared Products Company, Inc. (Prepco) (defendant) in February 1998. Under the agreement, Prepco agreed to purchase $10 million of products from Family Snacks over the course of a year, beginning on July 1, 1998. The price of the product was set by a formula, which calculated the manufacturing cost of the particular product plus 15 percent of the cost as a profit margin. The manufacturing cost of each product was determined by another formula, which was attached as an exhibit to the contract. The contract did not specify which party had to act first. No provision dealt with whether Prepco had to provide Family Snacks with a specific order before Family Snacks would provide pricing for the product. Prepco did not order any products during the first year, and Family Snacks sued Prepco for breach of contract. Prepco argued that Family Snacks was obligated to provide pricing in order for Prepco to determine which products to order. The district court granted summary judgment to Family Snacks, and Prepco appealed to the United States Court of Appeals for the Eighth Circuit.
Rule of Law
Holding and Reasoning (Beam, J.)
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