INSTRUCTIONS:Your answer should demonstrate your ability to analyze the facts in the question, to tell the difference between material facts and immaterial facts, and to discern the points of law and fact upon which the case turns. Your answer should show that you know and understand the pertinent principles and theories of law, their qualifications and limitations, and their relationships to each other. Your answer should evidence your ability to apply the law to the given facts and to reason in a logical, lawyer-like manner from the premises you adopt to a sound conclusion. Do not merely show that you remember legal principles. Instead, try to demonstrate your proficiency in using and applying them. If your answer contains only a statement of your conclusions, you will receive little credit. State fully the reasons that support your conclusions, and discuss all points thoroughly. Your answer should be complete, but you should not volunteer information or discuss legal doctrines that are not pertinent to the solution of the problem. You should answer according to legal theories and principles of general application.

Neptune is an upscale seafood restaurant that opened in a convenient downtown location six months ago. It has become well known for the quality of its food and service. It has several dishes featuring salmon that are particularly popular with patrons. Neptune entered into a valid written contract with Seafood Uptown Providers (SUP) under which SUP agreed to supply Neptune with 250 pounds per week of fresh Pacific salmon at $4 per pound for the next year. Three months after the making of the contract, a large, widely publicized oil spill occurred in Pacific coast waters. The spill greatly reduced the catch of salmon. Salmon began selling on the open market for at least $5 per pound. SUP then told Neptune that it would supply salmon only at a price of $6 per pound. Neptune refused to pay more than the contract price. In fact, SUP has found a new customer willing to pay $6 per pound, and it is selling its entire supply (about 450 pounds of salmon per week) to that customer. Neptune, faced with the prospect of having to obtain salmon for its daily restaurant menu and also for special events that it caters, found a supplier willing to meet about one-half of Neptune's weekly requirement for salmon at $5 per pound. With further effort, Neptune might have filled a portion of the remaining weekly requirement for salmon at $6 per pound, but was uncertain to what extent salmon would continue to be obtainable and how high the market price might go. Neptune decided instead to reduce its menu offerings of salmon and to cancel several catering contracts. Within a month after reducing its menu offerings of salmon, Neptune experienced a 25% decline in its restaurant business from the previous month. It also had a 75% decline in new bookings for catering jobs. Neptune still has the immediate and long-term problem of how to obtain a reliable source of salmon, and wants to sue SUP.

What rights and remedies does Neptune have against SUP, what damages, if any, might Neptune recover, and what defenses, if any, should SUP assert? Discuss.