1. Sea-Land Services, Inc v. Lozen Internatioal, LLC No. 00-57058 285 F.3d 813 (9th Cir. 2002)
Lozen International president, Dean Myring, contacted Sea-Land Service to transport three 40-foot containers of grapes from Hermosillo, Mexico, to Felixtowe, England. The three containers of grapes were to first travel by truck until they reached the destination of the train, and then they would be loaded onto a cargo ship, Maersk, which would take them to Felixtowe. The cargo of grapes was to be delivered by June 28, 1999 according to terms of the agreement. Sea-Land’s railroad agent loaded the cargo on the wrong train, thus causing the shipment of grapes to miss the ship that was to deliver them to Felixtowe, England. The shipment couldn’t have come at a worse time either. Cheaper grapes from Europe were flooding the market, and the delay in the shipment caused Lozen to sale his grapes for a cheaper rate then he initially would have had they been delivered on time.
Sea-Land sued Lozen for the remaining contractual earnings for moving the cargo, and Lozen countersued for profits lost due to the reduced price he had to sale his grapes at. The two parties settled on the money owed to Sea-Land, but could not settle on the countersuit.
During the initial proceedings courts abused its discretion and left out a crucial piece of evidence. A Sea-Land employee forwarded an email that admitted that Sea-Land Service was at fault for the grape cargo mix up. The email read,
“I got with CSX to see if we could get containers taken from the train. . . . I'm not sure why CSX decided to rail them. Had we been able to truck these units, we could've made the vessel. . . . [W]e had plenty of time to get these units, had CSX allowed us to get our hands on them as we asked (repeatedly). I kept telling Lisa Tapley that these units were vessel protected loads, and they had to make the vessel. There was no ambiguity in my needs, with regards these units. It comes down to me wanting to truck these units, from Syracuse, as our recovery plan, but CSX, in their infinite wisdom, decided not to allow us to do this. This is totally, and completely a CSX failure.”
The court initially deemed the email hearsay. Lozen challenged that ruling, and was correct in doing so on the grounds that the email was from Sea-Land’s own party. Federal Rule of Evidence 801(d)(2)(D) provides that a statement is not hearsay if it is offered against a party and is "a statement by the party's agent or servant concerning a matter within the scope of the agency or employment, made during the existence of the relationship." The relationship described, them being coworkers, was only disputable due to the signature block used by the creator of the email. The original e-mail, an internal company memorandum, closes with an electronic "signature" attesting that the message was authored by "Mike Jacques," Sea-Land's "Rail Reefer Services Coordinator" at the time the e-mail was written. Jacques is listed as one of Sea-Land's employees in Exhibit 9, a letter from Sea-Land to Lozen that the district court did admit into evidence.
2. Cloud Coporation v. Hasbro, Inc. No. 02-1486. 314 F.3d 289 (2002)
Hasbro Inc. is a well known designer and marker of toys; they sold a toy named “Wonder World Aquarium” for a brief period within the 1990s. Hasbro was a successful company for a good amount of time. Hasbro got it’s products from Southern Clay Products Company which was to sell and ship Lapointe HB, a patented synthetic clay to Cloud Corporation. Cloud Corporation will mix preservatives according to the formula by Hasbro and send them to affiliates of Hasbro in East Asia; the affiliates in East Asia will mix it up and put the pieces together and make the final product and send it back to the U.S for distribution to retailers.
Cloud decided to sue Hasbro after they reserved a lot of the Lapointe HB mixed with preservatives and with the formula. They reserved it even though the Hasbro was struggling to sell. Cloud sued Hasbro because they have a lot of the formula only Hasbro will need, but Hasbro did not need them at the moment, because they were not doing well, market wise. Cloud sued them $600,000 stating that Hasbro was the only company who can use their product. After a bench trial, Cloud lost the case and the district judge ruled in favor of Hasbro because the original understanding between Hasbro and Cloud regarding Clouds role in Wonder World Aquarium was not a contract, because both parties did not agree on price, quantity, or delivery dates.
The original terms were that purchase orders will be sent to Cloud by Hasbro. After receiving the purchase order, Cloud would send an acknowledgement and would order from Southern Clay Products the quantity or Lapointe required to fill the purchase order.
Few months after Wonder World Aquarium was launched in October 1995, Hasbro sent a letter to all of its suppliers which contained the terms and agreements form to govern future purchase orders. One of the terms was that the supplier could not deviate from a purchase order without Hasbro’s written consent; cloud signed the form and returned to Hasbro. To make assurance double sure, anytime Hasbro sent a purchase order it would send acknowledgement form for Cloud to sign. Cloud never signed it and Cloud sent its own term and conditions on the back of the reply to Hasbro but they never signed either.
Due to misunderstanding and not reaching a contract without both parties signing and agreeing, Cloud made extra orders for months ahead without realizing the plug had been pulled by Hasbro because they were not doing well in business.
Sea-Land Service v Lozen International. http://www.law.berkeley.edu/faculty/sklansky/evidence/evidence/cases/Cases%20for%20TOA/Sea-Land%20Service%20v.%20Lozen%20International.htm
Cloud v. Hasbro. http://openjurist.org/314/f3d/289/cloud-corporation-v-hasbro-inc