UNITED STATES V. WEGEMATIC CORP. 360 F.2d 674 (1966) CASE BRIEF

UNITED STATES V. WEGEMATIC CORP.

360 F.2d 674 (1966)

NATURE OF THE CASE: This was a suit for damages for undelivered goods. Wegematic (D) appealed a judgment awarding United States (P) damages in a breach of contract action arising from D's failure to deliver a proposed computer system.

FACTS: Wegematic (D) entered into a contract with the Federal Reserve Board to deliver 5 general-purpose electronic digital computing systems. The delivery was to be within nine months from the date of contract award on June 30, 1957. Liquidated damages of $100 per day for delay were part of the contract and also a liability cancellation clause. The units were never delivered and The Federal Reserve Board contracted with IBM to deliver a IBM 650 computer at a rental of $102,500 and at a purchase option of $410,450. The contract with D had a price tag of $231,800. The Federal Reserve Board sued D for damages under the delay clause for $46,300 and $179,450 for the excess cost of the IBM equipment and $10,056 for preparatory expenses. That totaled $235,806 with 6% interest from October 6, 1958 to which the court awarded The Federal Reserve Board. D appealed.

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