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General Trading International v. Wal-Mart Stores

United States Court of Appeals for the Eighth Circuit
320 F.3d 831 (2003)


Facts

Wal-Mart Stores (defendant) agreed to buy 250,000 reindeer made of grapevines from General Trading International (GTI) (plaintiff). When Wal-Mart received the first shipment of reindeer, Wal-Mart discovered that a large percentage of the reindeer were defective and canceled future deliveries. Wal-Mart then met with GTI to discuss the poor quality of the reindeer. Initially, the parties agreed that Wal-Mart would withhold $400,000 of the amount due to GTI to cover customer returns. Subsequently, Wal-Mart marked down the retail price of the reindeer because sales were low. On September 30, a Wal-Mart representative emailed GTI saying, “I’m going to change the reserve on the account to $600,000.” Wal-Mart received no response to the September 30 email. In November, GTI contacted Wal-Mart to complain about Wal-Mart’s past-due payments. Wal-Mart responded that the parties had both agreed to the $600,000 hold, which covered both returns and markdowns. GTI promptly objected to Wal-Mart’s claim to the $600,000 hold and sued Wal-Mart for breach of contract. Wal-Mart counterclaimed. GTI filed a motion for partial summary judgment, arguing that the Uniform Commercial Code (UCC) statute of frauds rendered Wal-Mart’s purported contract modification ineffective. The trial court granted CTI’s motion for partial summary judgment, and Wal-Mart appealed.

Rule of Law

Issue

Holding and Reasoning (Bowman, J.)

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