Crowell has reported before on important ripples in commercial contract law centered on what counts as the enforceable contract between automotive product buyers and sellers. In its 2023 opinion in MSSC Inc. v. Airboss, the Michigan Supreme Court found that a master supply agreement was not enforceable, as opposed to the individual release orders issued under those agreements. Courts and industry have been left to grapple with the significant implications since.

On October 29, in FCA US v. Kamax, the same high court agreed to take up two related questions:

• First, whether a 2020 Michigan case, Cadillac Rubber v. Tubular Metal, remains good law after Airboss. Cadillac found enforceable a purchase order whose quantity term had the buyer purchasing a range from very low to up to 100% of the buyer’s requirements.
• Second, and related, the central issue in Kamax: whether a written contract calling for about 65% to 100% of a buyer’s requirements satisfies or violates Michigan’s statute of frauds. The intermediate court of appeals below found this to be an enforceable requirements contract.

Notions of commercial contracting once thought settled are no longer. The consequences for business are large. Crowell will continue to monitor and report.