Transamerica Case Study

Transamerica Oil Corporation, Plaintiff-Appellee, v. Lynes, Inc. and Baker International Corporation, Defendants-Appellants

No. 81-1505

United States Court of Appeals for the Tenth Circuit

723 F. 2d 758; 1983 U.S. App. Lexis 14288; 37 U.C.C. Rep. Serv. (Callaghan) 1076.

December 21, 1983

Procedural History: The plaintiff is Transamerica Oil Corporation which filed a lawsuit against Lynes, Inc and Baker International Corporation, the defendants, after Transamerica Oil Corporation (TOC) purchased several injection packers from Lynes Inc. TOC found out that the injection packers did not work as well as the company claimed in their advertisements and by the district manager Jack Spencer. The original award by the court was decided in favor of the plaintiff, Transamerica Oil Corp. in the amount of $196,577.62 which was more than what was originally paid.

Facts: The president of TOC was Harold Brown. TOC was a company that was in the business of drilling and completing oil and gas wells. Harold Brown had seen an advertisement for the production injection packers from Lynes Inc and Baker International Corporation, (defendant) in a trade journal. It was stated in their advertisement that their packers were suitable for permanent long term use. Harold Brown wanted to save money by using these packers. Harold Brown had spoken with a sales representative for Lynes and had received more literature in the mail. The literature had also stated that the injection packers were suitable for permanent use. When he received this information Harold Brown called the district manager for Baker International Corporation. Brown stated he wanted to use the packers as a permanent solution in the wells and Spencer assured him he thought they would work as the company advertised. Based on that information, Harold Brown ordered ten injection packers from them. Five invoices were sent to Brown, each had statements printed on the back of the pages disclaiming any express or implied...