QVC, Inc. (plaintiff) used its cable channel to sell 16,721 space heaters that QVC had purchased from MJC America, Ltd. (MJC) (defendant). QVC charged its customers $68 per heater. After paying MJC $36 per heater and some other costs, QVC anticipated earning a profit of $26 on each heater. Many customers reported that their space heaters began smoking, sparking, or emitting flames. QVC decided to recall the heaters. QVC then sued MJC to recover QVC’s costs and lost profits. The costs QVC sought included the price it had paid MJC for each heater; refunds of shipping costs to customers on their initial purchase and later returns of defective heaters and cords; shipping costs for QVC’s return of defective heaters to MJC; costs for processing returns; and the profits QVC lost for every heater it sold then recalled. The purchase order between QVC and MJC required MJC to refund QVC’s purchase price and shipping costs for defective merchandise. Additionally, the purchase order required MJC to indemnify QVC against losses, including consequential damages, resulting from defective heaters. QVC provided evidence of its costs and losses for all of these categories.