IPSCO Tubulars, Inc. v. Ajax TOCCO Magnathermic Corp.

IPSCO Tubulars contracted for Ajax to provide equipment to heat-treat steel pipe at IPSCO’s Blythesville plant, which produces pipe for use in the oil and gas industry. After installation, the product did not perform properly. Tubing processed through the equipment was badly distorted. IPSCO sued for breach of contract, gross negligence, and punitive damages. The district court found Ajax liable for breach of contract, awarding $5,162,298.55 in damages. The Eighth Circuit reversed and remanded the breach-of-contract damages, holding that there were inadequate findings to support the award, and affirmed in all other respects. The most reasonable interpretation of the contract as a whole obligated Ajaxto provide equipment that could uniformly heat-treat pipe, at 96 fpm, without causing distortion, cracks or inconsistencies that would prevent the pipe's conversion to higher American Petroleum Institute grades; the evidence was sufficient to establish that the defects in the Ajax equipment was the cause of the defects in the pipe. View "IPSCO Tubulars, Inc. v. Ajax TOCCO Magnathermic Corp." on Justia Law