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A manufacturer assembles small engines out of parts that it obtains from various suppliers. One of these suppliers is an individual, who makes pistons for use in the engines. One shipment of the pistons contains invisible defects, which cause the manufacturer’s engines to fail prematurely. The manufacturer believes that the supplier intentionally hid the defects upon delivery.
The manufacturer thus sues the supplier in a U.S. district court, where subject-matter jurisdiction, personal jurisdiction, and venue are all proper. The complaint asserts one count of fraud and one count of breach of contract. Under applicable law, fraud requires a deliberate misrepresentation by the defendant.
At trial, the manufacturer presents an expert witness in the field of metallurgy. The expert testifies that the pistons contained metal that was too soft for its intended purpose, which caused the pistons to fail. The expert testifies that the supplier could easily have spotted this defect with proper testing.
The manufacturer’s president testifies this: upon delivery, the supplier expressly told the president that the pistons were of suitable quality. Through the president’s testimony, the manufacturer also introduces into evidence the sales contract with the supplier. The contract contains a warranty provision guaranteeing that the pistons are suitable for their intended purpose.
The president further testifies that the parties discussed this warranty provision when the contract was executed. The supplier’s attorney cross-examines the president about the warranty provision, but cross-examination yields no new facts or admissions. The supplier does not object to the president’s testimony, or to introducing the contract in evidence.
The supplier testifies personally, stating that the pistons were “fine.” On cross-examination, the manufacturer’s attorney asks whether the supplier tested the pistons before delivery. The supplier answers, “Yes.” The manufacturer’s attorney then asks whether the testing identified any defects. The supplier answers, “Um, maybe just a few, but not enough to cause a problem. I’m really not sure. I don’t remember.”
At the close of evidence, the supplier moves for judgment as a matter of law on the fraud claim, arguing that the manufacturer has presented no evidence that the supplier intentionally misrepresented the quality of the pistons, thus failing to prove an essential element of its fraud claim. The judge denies the motion.
At the same time, the parties present requested jury instructions. The manufacturer requests an instruction on breach of warranty. The supplier objects, arguing that the manufacturer did not include a breach-of-warranty claim in its complaint. The manufacturer then moves to amend its complaint to include a claim for breach of warranty. The judge disallows the amendment, sustains the supplier’s objection, and states that the jury will not be instructed on breach of warranty. The manufacturer objects on the record.