Southern California Acoustics Co., Inc. v. C.V. Holder, Inc.

Southern California Acoustics Co., Inc. (Acoustics) (plaintiff) is a subcontractor. C.V. Holder, Inc. (Holder) (defendant) is a general contractor. Acoustics submitted a bid to supply products to Holder as part of a potential prime contract between Holder and the Los Angeles Unified School District (school district) (defendant). Holder did not respond to Acoustics’ bid, but submitted its own bid for the prime contract with the school district. Holder was awarded the prime contract by the school district. A local newspaper published a story about the award of the prime contract to Holder and listed the names of each of Holder’s subcontractors. The newspaper article listed Acoustics as a subcontractor. Acoustics did not receive notification of acceptance from Holder, but instead assumed its bid had been accepted by Holder after reading the newspaper article. As a result, Acoustics refrained from bidding on other prime contracts. Holder later requested and received permission from the school district to substitute another subcontractor for Acoustics, allegedly on the ground that Acoustics was inadvertently named as a subcontractor in the newspaper article. Acoustics sought a writ of mandamus in California state court seeking to compel the school district to rescind its consent to the change in subcontractors. The trial court sustained the school district’s demurrer and dismissed Acoustics’ complaint. Acoustics did not appeal, but instead brought suit in California state court against Holder and the school district seeking damages for breach of contract. In the alternative, Acoustics sought damages based on a theory of promissory estoppel.