X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.
The full case caption appears at the end of this opinion. Williams, Circuit Judge. Plaintiff-AppellantBrooklyn Bagel Boys, Inc. (“Brooklyn Bagel”),brought this diversity action against Defendant-Appellee Earthgrains Refrigerated Dough Products,Inc. (“Earthgrains”), claiming that Earthgrainswrongfully terminated a contract for the supplyof bagels. Thereafter, Earthgrains filed a motionfor summary judgment, which the district courtgranted against Brooklyn Bagel. Prior to thisdetermination, the district court also grantedEarthgrains’ motion to strike the certificationof Gregory Stahl, the former president ofBrooklyn Bagel. This appeal followed the districtcourt’s entry of summary judgment in Earthgrains’favor. For the reasons discussed below, we affirmthe judgment of the district court. I Brooklyn Bagel produces bagels for third partieswho sell them under their own brand name.Earthgrains manufactures, distributes, and sellsrefrigerated dough products. In April, 1994,Earthgrains began working on a project to developits own proprietary formula for bagels. Afternearly two years, Earthgrains developed a bagelformula and began to contract with different “co-packers” to manufacture bagels for distributionunder Earthgrains’ brand name. Earthgrainsentered into these “co-packing” relationships inan effort to test the viability of its formulawithout having to incur the substantial capitalexpense of building its own bagel manufacturingfacility. In late 1994 or early 1995, Earthgrainsapproached Brooklyn Bagel about being a co-packerfor the distribution of bagels out ofEarthgrains’ Fort Payne, Alabama facility.Contract negotiations began, and the partieseventually entered into a Contract PackagingAgreement (“Contract”) on March 25, 1996. Underthe Contract, Brooklyn Bagel agreed to processand package bagels for Earthgrains in packagingbearing Earthgrains’ brand name or othertrademarks owned or licensed by Earthgrains.Brooklyn Bagel also agreed to purchase all of theraw materials and packaging supplies necessary toproduce the bagels at its Franklin Park, Illinoisfacility. Earthgrains, on the other hand, agreedto provide Brooklyn Bagel with all the racks andtrays necessary for shipping the bagels. Inconnection with this obligation, Earthgrains wasresponsible for picking up the bagels fordistribution to its facilities. The Contract, among other terms, provided aprice structure for the bagels. The Contract doesnot require Earthgrains to purchase a specificquantity of bagels from Brooklyn Bagel. Instead,the Contract stated that Brooklyn Bagel was toprocess and package the “ordered quantity” ofbagels. The Contract required Earthgrains,however, to provide a non-binding forecast everythree months, in a form as agreed by the parties,for its expected bagel orders. The parties agreedthat the Contract would “continue in effect untileither party terminates it upon ninety (90) daysprior written notice to the other party of suchtermination or terminates it as otherwiseprovided in th[e] Agreement.” (Contract para. 6.)Their relationship continued under the Contractuntil Earthgrains decided to begin manufacturingits own bagels. In July, 1997, Earthgrains purchased thebusiness of one of its other co-packers. Thatsame month, Brooklyn Bagel’s Customer ServiceManager for the Earthgrains’ account, VickiAbrams, learned of Earthgrains’ plans to installbagel manufacturing equipment in the Fort Paynefacility. Abrams then contacted Earthgrains’Marketing Director, Phil Gruszka, concerning thisdevelopment, and Gruszka indicated that therelationship between the parties would remainunchanged for now. Later that year, Abrams againcontacted Gruszka, this time to ask whetherBrooklyn Bagel could budget Earthgrains’ businessin 1998. Approximately 80 percent of the bagelssold by Brooklyn Bagel to Earthgrains during 1997were shipped to and distributed out of the FortPayne facility. Gruszka informed Abrams that “hedidn’t know what [Earthgrains'] long-term planswere, but [he] didn’t think 1998 was an issue.”At no point during his conversations with Abramsdid Gruszka make any promises to her aboutEarthgrains’ plans for 1998 bagel production, andAbrams had her doubts about whether Earthgrainswould continue ordering bagels from BrooklynBagel in 1998. In late 1997, Earthgrains began installingequipment to manufacture bagels at the Fort Paynefacility. Earthgrains completed the installationby March of 1998. Around this time, Earthgrainssent Brooklyn Bagel a letter expressing itsintent to terminate the Contract. Earthgrainssent the letter in accordance with the Contract’sninety-day written notice of terminationprovision. Gruszka also verbally advised Abramsof the termination. Earthgrains then stoppedordering bagels from Brooklyn Bagel for its FortPayne facility, but continued to order for itsDes Moines, Iowa facility. Once Abrams realizedthat Earthgrains stopped ordering bagels for theFort Payne facility, she wrote Earthgrains’President, William Opdyke, acknowledging receiptof the termination letter. In late March, 1998,Earthgrains sent Brooklyn Bagel a forecast forits expected orders of bagels for distributionout of the Des Moines facility over the remainingmonths of the Contract, which was to terminate inJune, 1998. In July, 1998, Brooklyn Bagel sued Earthgrains,asserting various state law claims for breach ofcontract, breach of an implied duty of good faithand fair dealing, promissory estoppel, and unjustenrichment. One year later, the district courtgranted Earthgrains summary judgment, findingthat the terms of the Contract were unambiguousand did not obligate Earthgrains to purchase itsbagel needs for the Fort Payne facility fromBrooklyn Bagel. The district court ruled thatEarthgrains did not breach the parties’ Contractand concluded that summary judgment wasappropriate with respect to Brooklyn Bagel’sremaining claims. Prior to this determination,the district court also granted Earthgrains’motion to strike the certification of GregoryStahl, the former president of Brooklyn Bagel anda signatory of the parties’ Contract, because thecertification was not based on Stahl’s personalknowledge and did not affirmatively demonstratehis competency to testify on matters containedtherein as required by Fed. R. Civ. P. 56(e).Brooklyn Bagel now appeals the district court’ssummary judgment decision with respect to thedismissal of the breach of contract and breach ofthe implied duty of good faith and fair dealingclaims, as well as the district court’s ruling onEarthgrains’ motion to strike. II We review de novo the district court’s decisionto grant summary judgment to Earthgrains. SeeJohnson v. Zema Sys. Corp., 170 F.3d 734, 742(7th Cir. 1999). In order to overcome a motionfor summary judgment, Brooklyn Bagel must showspecific facts sufficient to raise a genuineissue of material fact for trial. See Fed. R.Civ. P. 56(c). In determining whether a genuineissue of material fact exists, we construe therecord and all reasonable inferences drawntherefrom in the light most favorable to BrooklynBagel, the non-movant. See Senner v. NorthcentralTechnical College, 113 F.3d 750, 754 (7th Cir.1997). In reviewing the district court’s decisionto strike Stahl’s certification, however, we lookfor an abuse of discretion. See Wollenburg v.Comtech Mfg. Co., 201 F.3d 973, 977 (7th Cir.2000). A. Breach of Contract 1. Did the Parties Enter a RequirementsContract? Brooklyn Bagel argues that the parties’ Contractis an exclusive “requirements contract”obligating Earthgrains to order all of its bagelrequirements for the Fort Payne facility fromBrooklyn Bagel. Brooklyn Bagel contends that theContract is ambiguous and that extrinsic evidencedemonstrates that the parties intended to entera requirements contract. In many Americanjurisdictions, including Illinois (which theparties agree governs this dispute), “arequirements contract exists only when thecontract (1) obligates the buyer to buy goods,(2) obligates the buyer to buy goods exclusivelyfrom the seller, and (3) obligates the buyer tobuy all of its requirements for goods of aparticular kind from the seller.” Zemco Mfg.,Inc. v. Navistar Int’l Transp. Corp., 186 F.3d815, 817 (7th Cir. 1999) (citing James J. White& Robert S. Summers, Uniform Commercial Code sec.3-9, at 154-55 (1995), and E. Allan Farnsworth,Farnsworth on Contracts sec. 2-15, at 135-37(1990)); see Wald v. Chicago Shippers Ass’n, 529N.E.2d 1138, 1146 (Ill. App. Ct. 1988). While Brooklyn Bagel asserts that the Contractis ambiguous and therefore capable of beinginterpreted as a requirements contract, thedistrict court determined that, as a matter oflaw, the Contract is not a requirementscontract. [FOOTNOTE 1] In examining whether the Contract isambiguous, [FOOTNOTE 2] we first look to the plain languageof the Contract. See Atlantic Mut. Ins. Co. v.Metron Eng’g & Constr. Co., 83 F.3d 897, 898 (7thCir. 1996); Metalex Corp. v. Uniden Corp. of Am.,supra, 863 F.2d at 1333. Brooklyn Bagel arguesthat the plain language of the Contract isambiguous as to whether it is a requirementscontract since the Contract lacks a quantityterm. However, we are bound to construe theContract as a whole, see Echo, Inc. v. WhitsonCo., Inc., 121 F.3d 1099, 1105 (7th Cir. 1997)(interpreting Illinois law), and the lack of aquantity term itself does not necessarily rendera contract ambiguous. In relevant part, Paragraph 2(a) of theContract states: Subject to Paragraph 2(d) below, upon order by[Earthgrains], [Brooklyn Bagel] will process andpack the ordered quantity of the Product. TheProduct will be packed in accordance with thepackaging instructions set forth in Exhibit B.[Brooklyn Bagel] shall not produce Product inadvance of an order, and in no event shall itproduce more than 104% of any quantity of Productordered by [Earthgrains]. Paragraph 2(d), in turn, provides: On or before each January 1, April 1, July 1 andOctober 1 during the term hereof, [Earthgrains]shall submit [Brooklyn Bagel] a written forecast(in such form as may be agreed to by the parties)of [Earthgrains'] anticipated requirements forthe next succeeding 3 months; provided that suchforecasts shall not be binding on either party.[Earthgrains] shall use reasonable efforts tonotify [Brooklyn Bagel] at least 4 weeks inadvance if [Earthgrains] anticipates a materialincrease in [Earthgrains'] demand for theProduct. After examining these provisions in context withthe Contract as a whole, we agree with thedistrict court that the Contract is not arequirements contract as it does not expresslyobligate Earthgrains to purchase all, or anyspecified quantity, of its requirements of bagelsfor the Fort Payne facility from Brooklyn Bagel.While such an obligation can be implicit, thedistrict court correctly characterized theContract as a “buyer’s option,” similar to theagreement at issue in In re Modern Dairy ofChampaign, Inc., 171 F.3d 1106 (7th Cir. 1999).In Modern Dairy, two school districts argued thata dairy contractor was obligated to supply theirmilk requirements. In examining the existence ofa requirements contract, this court observed thatthe parties’ contractual documents did notexplicitly, or by implication, require the schooldistricts to buy their milk requirementsexclusively from the dairy. Insofar as the dairymerely agreed to sell milk to the schooldistricts at a specified price, within aspecified period of time, the court characterizedthe parties’ agreement as a “buyer’s option”rather than a requirements contract. Brooklyn Bagel, however, asserts that theContract is no different from the ambiguoussupply contract involved in Zemco Mfg., Inc. v.Navistar Int’l Transp. Corp., supra. The factshere are far different than those in Zemco. InZemco, this court found the supply contract,which also did not include a quantity term, to besusceptible to more than one interpretation. Bycontrast, in this case, there is but onereasonable interpretation of the contractuallanguage. Paragraph 2 of the Contract clearlygave Earthgrains the discretion to order itsbagel needs from Brooklyn Bagel. The contractuallanguage here cannot be alternatively read as an”articulation of the manner in which [the buyer]should place its orders as it has need for the[specified goods],” like the contractual languagein Zemco. 186 F.3d at 817. Furthermore, thecontract in Zemco, unlike here, contained apriority clause in the event the supplier wasunable to meet the production need of the buyermanufacturer. Zemco also involved exclusivedealings between the parties over a period oftwelve years, a circumstance not present in thiscase. Therefore, a variety of textual and non-textual considerations precluded the Zemco courtfrom ruling out the existence of a requirementscontract. Under the Contract, Earthgrains clearly had noobligation to buy all, let alone any quantity, ofits bagel requirements from Brooklyn Bagel.Paragraph 2 makes this clear, and the Contractspecified a fee to be paid for the “ordered”bagels, which could only increase or decrease atsix-month intervals. Under the IllinoisCommercial Code, such an agreement is enforceableeven though Earthgrains made no reciprocalcommitment to buy all its bagel needs fromBrooklyn Bagel. See 810 Ill. Comp. Stat. sec.5/2-205; [FOOTNOTE 3] Modern Dairy, 171 F.3d at 1110(noting “[a] seller’s firm offer to supply thebuyer’s needs for some good at a specified priceand other terms is enforceable . . . even thoughthe buyer makes no reciprocal commitment to buyall its needs from this seller”). Therefore, thedistrict court’s characterization of the Contractas a buyer’s option was appropriate. [FOOTNOTE 4] In an effort to demonstrate that the partieshad a requirements contract, Brooklyn Bagel alsopoints to sec. 2-306(1) of the Uniform CommercialCode, [FOOTNOTE 5] which functions as a primary gap-fillerfor open quantity terms in requirementscontracts. Under Illinois law, however, anessential element of a requirements contract isthe promise by the buyer to purchase all of itsrequirements, or at least a minimum quantity,from the seller. See Torres v. City of Chicago,supra, 632 N.E.2d at 58. No promise of thatnature can be found in the Contract. Moreover,Brooklyn Bagel cannot genuinely dispute this lackof exclusivity in the Contract. [FOOTNOTE 6] In the absenceof exclusivity, there can be no validrequirements contract. See id.; see also White &Summers, supra, sec. 3-9, at 155-56 (noting”[b]ecause section 2-306 depends on exclusivityto determine the quantity, there can be no validrequirements contract without it”). While Brooklyn Bagel argues that Paragraph 2(d)contemplates the use of estimates or forecasts–acommon feature of a requirements contract–theContract provides that “such forecasts shall notbe binding on either party,” and Brooklyn Bagelacknowledges that the parties rarely used thisfeature. With respect to Brooklyn Bagel’scontention that the parties intended for BrooklynBagel to be the sole supplier of bagels at theFort Payne facility, this promise is nowhere tobe found in the Contract. In fact, the Contractdoes not reference any geographic region ordistribution facility. The parties surely couldhave included this term in the Contract had theydesired. In any event, Brooklyn Bagel cannotpoint to any contractual language indicating thatit would be a breach of contract for Earthgrainsto either (1) stop ordering from Brooklyn Bagel,(2) use another manufacturer, or (3) manufactureits own bagels. Accordingly, the Contract, taken as a whole,overwhelmingly establishes that the parties didnot enter a requirements contract. Instead, theContract provided an agreement by Brooklyn Bagelto manufacture bagels for Earthgrains at aspecified price, within an agreed period, subjectto Earthgrains’ bagel needs. Brooklyn Bagel nevertheless argues thatextrinsic evidence demonstrates that Earthgrainswas obligated to buy all of its bagelrequirements for the Fort Payne facility fromBrooklyn Bagel. The district court found BrooklynBagel’s extrinsic evidence inadmissible or,alternatively, unsupportive of its position. Asan initial matter, the Contract contains anintegration clause stating that the Contractbetween the parties “constitutes the entireagreement of the parties,” and “supersedes allprior and contemporaneous agreements.” (Contractpara. 25.) Given such a clause, the parolevidence rule generally forbids the use inevidence of a prior or contemporaneous agreementor terms not included in the Contract. SeeSunstream Jet Exp., Inc. v. International AirServ. Co., Ltd., 734 F.2d 1258, 1265 (7th Cir.1984) (noting under Illinois law “if the contractimports on its face to be a complete expressionof the whole agreement, it is presumed that theparties introduced into it every material item,and parol evidence cannot be admitted to addanother term to the agreement”). Notwithstanding the parol evidence rule,extrinsic evidence can be admitted to discoverthe parties’ genuine intent when a contract isambiguous, see FDIC v. W.R. Grace & Co., supra,877 F.2d at 620-21; Modern Dairy, 171 F.3d at1109, but “there must be either contractuallanguage on which to hang the label of ambiguousor some yawning void . . . that cries out for animplied term.” Bidlack v. Wheelabrator Corp., 993F.2d 603, 608 (7th Cir. 1993) (en banc) (leadopinion). Extrinsic evidence cannot be used “tocreate a conflict completely apart from thecontract itself.” R.T. Hepworth Co. v. DependableIns. Co., Inc., 997 F.2d 315, 318 (7th Cir.1993). Brooklyn Bagel neither points to anycontractual language that is reasonablysusceptible to differing interpretations, norsuggests a void that “cries out for” an impliedterm in the Contract. As a further constraint on the consideration ofthis evidence, the Illinois Commercial Code onlyallows extrinsic evidence including course ofperformance, course of dealing, and usage oftrade to be considered when it is reasonablyconsistent with the express terms of thecontract. See 810 Ill. Comp. Stat. sec.sec. 5/2-208(2), 5/2-202. Brooklyn Bagel does not seek tointroduce evidence that is consistent with theterms of the Contract, [FOOTNOTE 7] and it otherwise failsto establish any ambiguity in the terms of theContract. We conclude, as a matter of law, thatthe parties did not enter a requirementscontract. 2. Did Earthgrains Breach the TerminationProvision? In a separate argument, which bears moredirectly on its breach of contract claim,Brooklyn Bagel asserts that even if the partiesdid not enter a requirements contract, theContract is ambiguous with respect toEarthgrains’ performance obligation under thetermination notice provision. Brooklyn Bagelclaims that the Contract obligated Earthgrains tocontinue ordering its bagel requirements fromBrooklyn Bagel during the ninety-day terminationnotice period. According to Brooklyn Bagel,Earthgrains therefore breached the terminationnotice provision when it stopped ordering bagelsfor the Fort Payne facility from Brooklyn Bageland began manufacturing its own bagels during theninety-day notice period. The Contract, however, only required Earthgrainsto provide Brooklyn Bagel with ninety-day writtennotice of termination. (Contract para.6.) Thereis no language contained within the terminationnotice provision itself, or the Contract as awhole, that obligated Earthgrains to order bagelsfrom Brooklyn Bagel even during the ninety-daynotice period, and Brooklyn Bagel has failed toshow that the parties intended such a performanceobligation in the face of the unambiguous termsof the Contract. Since Brooklyn Bagel does notdispute the adequacy or form of the noticeprovided, it has not established any breach ofthe Contract by Earthgrains and Earthgrains wasentitled to summary judgment on the contractclaim because there are no genuine issues ofmaterial fact for trial. B. Implied Duty of Good Faith and Fair Dealing Brooklyn Bagel further contends that Earthgrainsbreached its implied duty of good faith and fairdealing by not ordering bagels during the ninety-day termination notice period. Under Illinoislaw, “the covenant of good faith and fair dealingis not an independent source of duties for theparties to a contract.” Baxter Healthcare Corp.v. O.R. Concepts, Inc., 69 F.3d 785, 792 (7thCir. 1995) (interpreting Illinois law). While”[t]he UCC [810 Ill. Comp. Stat. sec. 5/1-203]imposes an obligation of good faith in theperformance of all contracts under its domain,”this duty merely “guides the construction ofcontracts and does not create independent dutiesof the contracting parties.” Echo, Inc., 121 F.3dat 1106. Therefore, Brooklyn Bagel cannot bringa separate cause of action on this basis. Id. While acknowledging that the implied covenant is”a tool of construction,” Brooklyn Bagel insiststhat Earthgrains acted in bad faith by notordering bagels during the ninety-day noticeperiod. In Kham & Nate’s Shoes No. 2, Inc. v.First Bank of Whiting, 908 F.2d 1351, 1357 (7thCir. 1990), the court stated: “Good faith” is a compact reference to an impliedundertaking not to take opportunistic advantagein a way that could not have been contemplated atthe time of drafting, and which therefore was notresolved explicitly by the parties. When thecontract is silent, principles of good faith–such as the UCC’s standard of honesty in fact,UCC sec. 1-201(19), and the reasonableexpectations of the trade, UCC sec. 2-103 . . .fill the gap. There is nothing in the Contract that prohibitsEarthgrains from manufacturing its own bagels,nor has Brooklyn Bagel shown that this reasonably”could not have been contemplated” by theparties. Accordingly, the district court properlydismissed Brooklyn Bagel’s claim for breach ofthe implied duty of good faith and fair dealing. C. Motion to Strike the Certification of GregoryStahl Brooklyn Bagel finally contends that thedistrict court erred by striking thecertification of Gregory Stahl, the formerpresident of Brooklyn Bagel and a signatory tothe Contract. Brooklyn Bagel initially assertsthat its breach of contract claim can beestablished without any consideration of Stahl’scertification. According to Brooklyn Bagel,Stahl’s certification merely offers additionalextrinsic evidence that the parties intended toenter into a requirements contract. Whileconsideration of this evidence is unnecessary inlight of the unambiguous Contract, we nonethelessreview the district court’s ruling for an abuseof discretion. Stahl’s certification purports to express hisown recollection before and at the time of theexecution of the Contract. The district courtexcluded Stahl’s certification because thecertification was not based on his personalknowledge and did not establish his competency totestify to the matters contained in thecertification. The district court based itsruling on Fed. R. Civ. P. 56(e). Under Rule56(e), an affidavit “shall be made on personalknowledge, shall set forth facts as would beadmissible in evidence, and shall showaffirmatively that the affiant is competent totestify to the matters stated therein.” An examination of the record indicates that thedistrict court did not abuse its discretion instriking Stahl’s certification. As the districtcourt observed, Stahl gave deposition testimonythat he was “really on the sidelines of [contractnegotiations]” and “ was being updated as th[e][contract negotiations] went along.” BrooklynBagel further admits that Stahl was not involvedin the “day-to-day” contractual negotiations.(Appellant’s Br. at 35.) Stahl, however,specifically testifies in the certification aboutthe understanding the parties had in executingthe Contract. Given his conflicting depositiontestimony, Stahl’s understanding of the Contract,which he did not form independent of others, isof no evidentiary value. Therefore, the districtcourt did not err in finding that Stahl lackedpersonal knowledge about the informationcontained in the certification. The district court was also correct in itsobservation that Stahl’s certification presentedmany self-serving, conclusory allegations, whichwere based on his private expectations of theContract. Stahl’s private expectations are of noconsequence, particularly since he offered nofactual basis to demonstrate Earthgrains’awareness of his expectation or understanding.See Sethness-Greenleaf, Inc. v. Green RiverCorp., 65 F.3d 64, 66-67 (7th Cir. 1995). Thedistrict court’s grant of Earthgrains’ motion tostrike Stahl’s certification did not constitutean abuse of discretion. III For the reasons stated above, we AFFIRM thejudgment of the district court. :::FOOTNOTES::: FN1 This court has recognized that “[i]f a contractis unambiguous, by definition no material issuesof fact exist regarding the contract’sinterpretation; that interpretation is a questionof law for the court.” Metalex Corp. v. UnidenCorp. of Am., 863 F.2d 1331, 1333 (7th Cir.1988). But if the contract is ambiguous, thecontract’s meaning is a question for the trier offact. Id. FN2 According to Illinois law, a contract isambiguous only if it is “reasonably and fairlysusceptible to more than one construction.”Omnitrus Merging Corp. v. Illinois Tool Works,Inc., 628 N.E.2d 1165, 1168 (Ill. App. Ct. 1993)(internal quotation marks and citation omitted).”The fact that parties to a contract disagreeabout its meaning does not [necessarily] showthat it is ambiguous.” FDIC v. W.R. Grace & Co.,877 F.2d 614, 621 (7th Cir. 1989). FN3 This section in relevant part states: An offer by a merchant to buy or sell goods in asigned writing which by its terms gives assurancethat it will be held open is not revocable, forlack of consideration, during the time stated orif no time is stated for a reasonable time, butin no event may such period of irrevocabilityexceed 3 months . . . . FN4 We note that the district court alternatelyviewed the parties’ relationship as a series ofseparate contracts, with the added element thatseveral of the contract terms would relate backto the original Contract, presumably on thetheory that each time Earthgrains placed an orderfor bagels, a contract between the parties wascreated. This characterization is consistent witha buyer’s option since the original Contract(although denominated as such by the parties) isakin to an offer by Brooklyn Bagel to manufacturebagels for Earthgrains at a specified price,within an agreed period. See White & Summers,supra, sec. 3-9, at 157; see also Streich v.General Motors Corp., 126 N.E.2d 389, 393-95(Ill. App. Ct. 1955). Earthgrains manifested itsassent to the offer, which Brooklyn Bagel neverrevoked, by placing orders for the bagels, thustriggering the obligations contemplated by theoriginal Contract (i.e., offer). See Torres v.City of Chicago, 632 N.E.2d 54, 58 (Ill. App. Ct.1994). FN5 This section states as follows: A term which measures the quantity by the outputof the seller or the requirements of the buyermeans such actual output or requirements as mayoccur in good faith, except that no quantityunreasonably disproportionate to any statedestimate or in the absence of a stated estimateto any normal or otherwise comparable prioroutput or requirements may be tendered ordemanded. UCC sec. 2-306(1); 810 Ill. Comp. Stat. sec. 5/2-306(1). FN6 Paragraph 2(a), for example, clearly enjoinedBrooklyn Bagel from producing bagels unlessEarthgrains placed an order for them, and eventhen Brooklyn Bagel could produce no more than”104% of any quantity” of bagels ordered byEarthgrains. FN7 Brooklyn Bagel’s extrinsic evidence, includingits supposed course of dealing, course ofperformance, and trade usage evidence, attemptsto show that the parties intended for BrooklynBagel to be the sole supplier of bagels at theFort Payne facility and that Earthgrains agreedto buy all of its bagel requirements for thatlocation from Brooklyn Bagel. However, we agreewith the district court that Brooklyn Bagel’sextrinsic evidence, taken as a whole, isinconsistent with the unambiguous terms of theContract. The evidence presents little, or no,objective proof of (1) prior exclusive dealingsbetween the parties, (2) an industry custom overthe usage of a single co-packer for a specificgeographic region, and (3) a course ofperformance indicating a requirements contract.See Murphy v. Keystone Steel & Wire Co., 61 F.3d560, 564 (7th Cir. 1995) (noting “[t]he partyclaiming that a contract is ambiguous must firstconvince the [court] that this is the case . . .and must produce objective facts, not subjectiveand self-serving testimony, to show that acontract which looks clear on its face isactually ambiguous”) (internal citation omittedand emphasis added); accord Ashan v. Eagle, Inc.,678 N.E.2d 1238, 1241 (Ill. App. Ct. 1997)(citing Home Ins. Co. v. Chicago & NorthwesternTransp. Co., 56 F.3d 763, 768 (7th Cir. 1995)).Furthermore, the evidence is critically undercutby the fact that Brooklyn Bagel supplied bagelsfor distribution out of Earthgrains’ Des Moines,Iowa facility. Since the Contract does notcontain any geographic restrictions on thedistribution of bagels sold by Brooklyn Bagel,this strongly suggests that Earthgrains hadcomplete flexibility in the manner in which itdistributed bagels sold by Brooklyn Bagel.
Brooklyn Bagel Boys, Inc. v. Earthgrains Refrigerated Dough Prods., Inc. In theUnited States Court of AppealsFor the Seventh Circuit No. 99-3055 Brooklyn Bagel Boys, Inc., Plaintiff-Appellant, v. Earthgrains RefrigeratedDough Products, Inc., Defendant-Appellee. Appeal from the United States District Courtfor the Northern District of Illinois, Eastern Division. No. 98 C 4421–James F. Holderman, Judge. Argued February 22, 2000–Decided May 8, 2000 Before Coffey, Easterbrook, and Williams, CircuitJudges.
 
Reprints & Licensing
Mentioned in a Law.com story?

License our industry-leading legal content to extend your thought leadership and build your brand.

More From ALM

Premium Subscription

With this subscription you will receive unlimited access to high quality, online, on-demand premium content from well-respected faculty in the legal industry. This is perfect for attorneys licensed in multiple jurisdictions or for attorneys that have fulfilled their CLE requirement but need to access resourceful information for their practice areas.
View Now

Team Accounts

Our Team Account subscription service is for legal teams of four or more attorneys. Each attorney is granted unlimited access to high quality, on-demand premium content from well-respected faculty in the legal industry along with administrative access to easily manage CLE for the entire team.
View Now

Bundle Subscriptions

Gain access to some of the most knowledgeable and experienced attorneys with our 2 bundle options! Our Compliance bundles are curated by CLE Counselors and include current legal topics and challenges within the industry. Our second option allows you to build your bundle and strategically select the content that pertains to your needs. Both options are priced the same.
View Now

African Legal Awards (AFLA) 2022

September 02, 2022
Johannesburg

The African Legal Awards recognise exceptional achievement within Africa s legal community during a period of rapid change.


Learn More

China Law & Practice Awards (CLPA) 2022

September 08, 2022
Beijing

The annual China Law & Practice Awards is the jurisdiction's most prestigious legal awards ceremony that applauds China's elite.


Learn More

Texas Legal Awards (TXLA) 2022

September 14, 2022
Dallas, TX

The Texas Lawyer honors attorneys and judges who have made a remarkable difference in the legal profession in Texas.


Learn More

Personal Injury Attorney


Monge & Associates is recognized as a Top Places to Work! We offer flexible in-office schedules, remote options and top compensation rat...


Apply Now ›

ATTORNEY-Philadelphia-Conshohocken-PA


Casualty Defense/Subrogation - commercial lines. Experienced. Flexible with remote working. Great hands-on complex litigation opportunity, g...


Apply Now ›

Finance/Corporate Trust Lawyer - CT or Remote


We are seeking a lawyer with a minimum of five years of experience in transactional work to join our well-established, nationally renowned C...


Apply Now ›

DEASEY, MAHONEY & VALENTINI, LTD.

08/08/2022
TLI Web

DEASEY MAHONEY & VALENTINI LTD is proud to announce that Lauren M. Steins and Leanna B. Ruotanen have been named Partners of the firm.


View Announcement ›

PARRETT, PORTO, PARESE & COLWELL, P.C.

08/08/2022
CLT Web

Parrett, Porto, Parese & Colwell, P.C. welcomes attorneys Alison L. Broad and Andrew I. Schaffer as principals of the firm.


View Announcement ›

MARSHALL DENNEHEY

08/04/2022
TLI Web

Marshall Dennehey Warner Coleman & Goggin mourns the loss of Robert J. Coleman, the last of its founding name partners.


View Announcement ›