Gruber v. S-M News Co. case brief summary
126 F.Supp. 442 (1954)
Plaintiff sellers, in a diversity
action, sought damages for breach of contract from defendant buyer
for a failure to distribute Christmas cards printed-to-order.
CASE FACTS The sellers were approached by the
buyer's agent, who later died, and an oral agreement was made for the
sellers to manufacture for the buyer 90,000 sets of 12 Christmas
greeting cards for 1945. The designs involved the newly formed United
Nations. The buyer, who had 700 wholesalers, showed the cards to only
four, who each chose not to buy. The sellers claimed damages of $
The court awarded $ 17,854, after finding:
(1) the statute of
frauds was not a defense where other written materials showed the
(2) the agreement was a contract for distribution and
return of 90,000 sets of cards, and not one for their sale,
buyer did not exercise the promised "reasonable diligence"
in showing the cards to only four wholesalers,
(4) the salability of
the cards may have been affected by world events after 1945,
sellers could not show how many cards might have been sold, thus
failing to carry their burden of showing certain profits, and
buyer could not show that the sellers would have sustained a loss.
Consequently, the court awarded the sellers their out-of-pocket
expenses, minus the small amount they had been able to obtain to
The court found that the sellers' expenditures for labor and
material reasonably made in essential reliance on the buyer's promise
was $ 19,934. From that sum was deducted the net amount realized by
the sellers from sale of 40,000 sets at six cents a set which was $
2,080. Accordingly, the sellers were entitled to $ 17,854 in damages. Suggested law school course materials, hornbooks, and guides for Contract Law
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