General Trading International, Inc. v. Wal-Mart Stores, Inc.

Beth Gitlin, a seasonal buyer for Wal-Mart, Inc. (Wal-Mart) (defendant), placed an order with General Trading International, Inc. (GTI) (plaintiff) for 250,000 vine reindeer. Upon delivery, Wal-Mart found that many of the reindeers were defective, and cancelled all future shipments. After communications with GTI, Wal-Mart agreed to purchase any reindeer already manufactured, but at a discounted price. Gitlin asked that GTI assent to a withholding of $400,000 for defective-merchandise claims. According to Gitlin, GTI also made an oral agreement to decrease the total balance owed by $200,000 to account for price markdowns resulting from the reindeers’ poor quality. On September 30, Gitlin emailed GTI, stating that the reserve would be changed to $600,000. On November 19, Gitlin emailed GTI, stating that $600,000 was on hold, with $200,000 going to markdowns and $400,000 to cover claims. The same day, GTI faxed Gitlin a demand for payment of the whole balance for the reindeer. On November 22, GTI emailed Gitlin an acceptance of the $400,000 withholding. On November 24, GTI expressed that its position was non-negotiable. The parties exchanged numerous emails thereafter, reflecting a dispute about the withholdings. GTI sued Wal-Mart for breach of contract and moved for summary judgment, arguing that the statute of frauds prevented the alleged oral agreement for the $200,000 withholding. The district court granted GTI’s motion and denied Wal-Mart’s motion for judgment as a matter of law. Wal-Mart appealed, arguing that under the merchants’ exception to the statute of frauds, Gitlin’s emails constituted confirmatory writings of the $200,000 price-markdown agreement, to which GTI did not timely object.