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Publicker Industries v. Union Carbide Corp.

United States District Court for the Eastern District of Pennsylvania
17 U.C.C. Rep. Serv. (Callaghan) 989 (1975)


Facts

In 1972, Union Carbide Corporation (defendant) contracted to sell ethanol to Publicker Industries (plaintiff) for a period of three years. The contract contained a detailed formula for calculating the price of the ethanol. Union’s costs were part of the formula, but the contract placed caps on the price Publicker could pay. By 1974, Union’s costs had become so high as a result of the 1973 Middle East War that it told Publicker that if Publicker did not agree to amend the agreement, Union would cease providing ethanol. Publicker refused and then brought suit seeking specific performance of the contract. Union presented evidence that its costs had doubled and that absent modification it would lose approximately $5.8 million on the contract. The parties agreed that the court would make a preliminary ruling on whether it could amend the contract.

Rule of Law

Issue

Holding and Reasoning (Weiner, J.)

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