Hennepin Paper Co. v. Fort Wayne Corrugated Paper Co.

Hennepin Paper Co. (plaintiff) entered into a written contract with Fort Wayne Corrugated Paper Co. (defendant). The contract provided that Fort Wayne would purchase “up to 600 tons, more or less” of corrugating material monthly from Hennepin. To clarify this language, at about the time of the contract’s execution, the parties allegedly agreed that the minimum commitment under the contract was for 600 tons per month. Thereafter, the parties orally agreed to change the minimum amount to 800 tons per month. Fort Wayne failed to take and pay for 800 tons of corrugating material monthly, and Hennepin sued Fort Wayne in the United States District Court for the Northern District of Indiana for breach of contract. Fort Wayne made a motion to strike out the allegations in Fort Wayne’s complaint regarding the contemporaneous negotiations on the grounds that the contract was unambiguous. The district court granted Fort Wayne’s motion and entered judgment in favor of Fort Wayne. Subsequently, Hennepin brought this action against Fort Wayne in the United States District Court for the Northern District of Illinois to reform the written contract so that it would reflect the true intent and understanding of both parties. Fort Wayne moved for summary judgment, arguing that this action was precluded by the district court’s judgment in favor of Fort Wayne in the prior action. The district court granted Fort Wayne’s motion, and Hennepin appealed.