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Contracts Keyed to Epstein
Drummond Coal Sales, Inc. v. Norfolk Southern Railway Company
Citation:3 F.4th 605 (2021)
Drummond entered into a contract with Norfolk Southern for guaranteed shipping services at fixed rates. The primary benefit of the Agreement to Drummond was that it could price a one-stop-shop contract because the shipping cost, previously unknown to Drummond, was not a known quantum. The Agreement did not prohibit Norfolk Southern from entering into or shipping coal under other third-party utility contracts. After Drummond and Norfolk Southern entered into the Agreement, the coal industry in the United States experienced significant change. From 2010 to 2014, Drummon did not ship any coal under the Agreement and paid Norfolk Southern the required shortfall fees. Then again in 2015 and 2016, Drummond did not ship any coal under the Agreement. In anticipation of Norfolk Southern’s next move, Drummond preemptively filed suit seeking a declaration of its rights and relief.
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