Quality Naturally! Foods, Inc. v. Reimelt Corporation
Published: Oct. 25, 1997 | Result Date: Aug. 18, 1997 | Filing Date: Jan. 1, 1900 |Case number: 7218136896 – $2,419,430
Judge
Court
American Arbitration Association
Attorneys
Plaintiff
Defendant
Lawrence P. Riff
(Los Angeles County Superior Court)
Experts
Plaintiff
John Carson
(technical)
Robert Sherwin
(technical)
R. Carl Hoseney
(technical)
Defendant
Jerry Johanson
(technical)
Irving Thau
(technical)
Paul Solt
(technical)
Facts
In December 1995, plaintiff Quality Naturally! Foods, Inc. (QNF) contracted with defendant Reimelt Corp. to modify an existing material handling system for the conveying and packaging of dry pre-mixes for the bakery industry. Defendant Reimelt designed and installed the retrofit to plaintiff QNF's existing system. The system installed by defendant caused the separation of ingredients in the dry pre-mix that was conveyed through the system to a bagging line. Defendant offered a modification to its design which required plaintiff to share in the cost of the modification. Plaintiff refused to share in the additional cost and demanded that defendant make its system work properly. When defendant was unable to fix the system, plaintiff terminated defendant's services and completed the modifications itself. The plaintiff brought this action against the defendant based on breach of contract, fraud and negligence theories of recovery. In a cross-complaint, defendant sought the remaining $330,000 owed by plaintiff under its contract with defendant.
Settlement Discussions
The plaintiff reported there were no offers or demands. The defendant reported that both before and during the arbitration, plaintiff's lowest demand was $3 million. Per defendant, plaintiff received attorney fees of $341,921 and expert fee of $122,380.
Damages
The plaintiff sought $2.8 million in damages for lost profits from lost sales to Japan, the cost of repair and other ancillary costs. The defendant sought $330,000 due and owing under the contract.
Other Information
The award was rendered approximately one year and five months after the case was filed. An arbitration was held on July 7, 1997 before George Halversen of AAA resulting in the reported award.
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