Rockland Industries is a Maryland corporation that manufactures drapery lining fabrics. Rockland uses approximately 500,000 pounds per year of antimony oxide, a fire retardant, on its fabrics. Manley-Regan is a Pennsylvania chemical distribution company. Rockland usually purchased its antimony oxide from HoltraChem on an “as-needed” basis, where HoltraChem had quoted a price based on the understanding that Rockland required approximately 500,000 pounds per year of antimony oxide. HoltraChem charged about $0.86 per pound during its last year as Rockland’s supplier.
Due to a serious worldwide crisis in the supply of this chemical in the spring of 1994, HoltraChem could no longer maintain its existing supply relationship with Rockland. Rockland, in exploring other suppliers, found that the antimony oxide market was extremely tight, with rising prices and no known recovery period.
Rockland contracted with Manley-Regan for delivery of antimony oxide (114,000 pounds total) at $1.80 per pound. That supply fell through because of the nature of the market and Rockville contracted with another supplier for 44,092 pounds of antimony oxide at $2.65 per pound and with still another supplier for 88,184 pounds at $2.54 per pound.
Rockland filed suit seeking as damages the difference between the price of $1.80 per pound and the various other prices it had paid. Manley-Regan used UCC § 2-615 as its defense claiming commercial impracticability. Does Manley-Regan have a good case using this defense? [Rockland Industries, Inc. v E+E (US) Inc., 991 F Supp 468 (D Md)]