Cloud Corp. v. Hasbro Inc.

Facts

Defendant, Hasbro Inc., sold a toy that requires the use of a specific powder. Plaintiff, Cloud Corp., packaged and mixed this substance for Defendant, pursuant to the instructions developed by Defendant. Also, Defendant sent Plaintiff a form with the terms and conditions, which indicated that Plaintiff could not violate the terms and conditions, absent written consent. Later, Defendant’s toy began to lose popularity in the market, and Defendant sent the final purchase orders to Plaintiff, who placed the final orders for the powder ingredients. Before the final purchase orders could be given to Plaintiff, Defendant gave Plaintiff a new formula for the powder mixture. The new mixture eliminated one of the expensive ingredients, Laponite. Plaintiff packed and mixed the powder, pursuant to the new formula. Nevertheless, because Plaintiff ordered the powder ingredients, pursuant to the old formula, Plaintiff had extra Laponite. Moreover, Plaintiff used the extra ingredients to pre-package and pre-mix additional packets. Plaintiff sent an order to acknowledge the original orders, which included the additional packages, even though Plaintiff never received a purchase order for the additional packages. Defendant received the acknowledgment order, but did not respond in an express manner. Nevertheless, Defendant’s employee sent an email and spoke on the phone with Plaintiff about the terms of the agreement. The emails contained numbers, which were consistent with Plaintiff’s order numbers, along with a memorandum written and signed by Defendant’s employee. Thereafter, Defendant refused to accept delivery or payment for the additional packages. Plaintiff filed suit for breach of contract against Defendant. The trial court ruled in Defendant’s favor, and Plaintiff appealed.