First National Bank of Omaha v. Three Dimension Systems Products, Inc.

The First National Bank of Omaha (Bank) (plaintiff) entered into a contract with Three Dimension Systems Products, Inc. (3D) (defendant), under which 3D was to create a computer software program for the Bank. After 3D delivered Stage I of the program to the Bank, 3D sent the Bank an invoice for an additional $250,000. 3D also informed the Bank that 3D would not be fixing any errors in Stage I after delivery. The Bank sued 3D for anticipatory breach, arguing that 3D had anticipatorily breached by refusing to make sure that Stage I would function correctly and by demanding the $250,000. 3D counterclaimed for breach of contract, and defended itself on the basis that the Bank had not given 3D an opportunity to cure the alleged breach. The Bank’s evidence included documents from 3D concerning the 10-day fixing period and the $250,000 invoice. The Bank also introduced testimony that 3D’s president had orally indicated that any Stage I errors would not be fixed until Stage III or IV, if at all, and that 3D would not move on to the next stage of development unless and until the invoice had been paid. The Bank’s evidence also suggested that the contract did not authorize the invoice. 3D argued that it would have fixed any errors in the later stages of the project and that its continued performance was not conditioned on the Bank’s payment of the invoice. A jury ruled in favor of the Bank, finding that 3D had anticipatorily breached the contract. However, the district court granted 3D’s motion for judgment as a matter of law. The Bank appealed.