            Case: 12-12186    Date Filed: 09/20/2012   Page: 1 of 13

                                                           [DO NOT PUBLISH]

              IN THE UNITED STATES COURT OF APPEALS

                       FOR THE ELEVENTH CIRCUIT
                        ________________________

                               No. 12-12186
                           Non-Argument Calendar
                         ________________________

                     D.C. Docket No. 7:10-cv-02095-LSC



GLOBAL MINERALS CORPORATION,

                                                        Plaintiff-Appellant,

                                    versus

NUCOR STEEL TUSCALOOSA, INC.,
NUCOR CORPORATION,

                                                        Defendants-Appellees.

                        ________________________

                 Appeal from the United States District Court
                    for the Northern District of Alabama
                        ________________________

                             (September 20, 2012)

Before CARNES, WILSON and KRAVITCH, Circuit Judges.

PER CURIAM:

     Global Minerals Corporation (Global) appeals from the district court’s grant
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of summary judgment in favor of defendants Nucor Steel Tuscaloosa, Inc. (NSTI)

and Nucor Corporation (NC) in this breach-of-contract action.1 Because we agree

with the district court that there was no breach, we affirm.

                                                I.

      NC is the largest steel producer in the United States and owns NSTI, which

is engaged in the production of steel using raw minerals such as ferrosilicon. In

February 2008, NSTI purchasing supervisor James Yerkes requested from several

entities a price quote for ferrosilicon. Although Global’s quote was not the lowest,

NSTI agreed to a trial order from Global to qualify Global for future purchases. In

March 2008, NSTI and Global entered into a deal for 100 net tons of ferrosilicon

to be delivered from October through December of that year. The purchase order

(PO) explained: “NSTI makes no commitment or guarantee with regard to the

actual quantity of product released under this purchase order. However, shall not

exceed 100 net tons without agreement with Global Minerals.” There is no

dispute that both parties fulfilled their obligations under this contract.

      During the spring of 2008, the price of ferrosilicon rose rapidly. To ensure

that it had sufficient supply, NSTI issued another PO on June 3, 2008 (the June

PO), before the trial delivery period even began but subject to satisfactory


      1
          We have diversity jurisdiction over this dispute. 28 U.S.C. § 1332.

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performance of the trial order. In the June PO, NSTI ordered 600 net tons of

ferrosilicon to be delivered between September and December 2008 at the price of

$1.48 per pound. This quantity was changed to 600 metric tons at Global’s

request. The June PO contained the same “no commitment of guarantee with

regard to the actual quantity of product released under this purchase order”

language, as well as the “not to exceed” language.

      Thereafter, the demand for, and price of, ferrosilicon dropped. Yerkes

approached Global to renegotiate the price, but Global declined to do so. From

September through December 2008, NSTI took delivery of only 29.79 tons from

the June PO. On December 29, 2008, Yerkes sent an email to Global’s vice

president of sales, Dan Ritter, informing Ritter that NSTI would not be taking any

more ferrosilicon under the June PO. Yerkes advised Ritter that NSTI needed

much less ferrosilicon than anticipated due to business conditions and the

recession.

      By email, Ritter responded that the June PO was a contract for a set quantity

of ferrosilicon, and he requested that NSTI purchase the remaining tons under the

terms of the contract. In a follow-up email, Ritter wrote that NSTI was obligated

to purchase an amount “reasonably proportionate” to the quantity given in the

contract, which it had not done.

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       Although Yerkes believed NSTI had fulfilled its obligations under the June

PO, on January 9, 2009, Yerkes contacted Ritter with the following offer: NSTI

would extend the contract through the first half of 2009 and would take all of its

purchase requirements from Global during that time.2 Yerkes explained that there

was no volume guarantee, and it offered to pay low market price plus $.39 per

pound.3 Ritter responded with two offers, each proposing that NSTI purchase the

remaining amount of the original 600 tons by the first half of 2009, with an

additional purchase at an agreed-upon price. By email, Yerkes informed Ritter

that the counter-offers were unacceptable and that NSTI’s offer was non-

negotiable. Ritter responded that he was not happy to take the loss but would

accept the offer in the hope that NSTI and Global could continue to work together.

       After Ritter accepted NSTI’s terms, Yerkes issued a change order on

January 15, 2009 (the January PO). This document was identical to the June PO

and had the same order number, but the words “change order” were stamped

diagonally across each page, the description specified “ADDENDUM 1/15/2009,”

and the due date was marked as June 30, 2009. The January PO stated:


       2
          NSTI had contracted with another company for its ferrosilicon for the first half of 2009
but deferred the deal until the second half of the year to accommodate the deal with Global.
       3
          For purposes of this deal, the market price was set by Ryan’s Notes, an industry
publication.

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      This change order is issued to extend the end date of this blanket
      order until June 30, 2009, based on a sincere request from Global
      Minerals to do so. Given the economic situation and that Nucor will
      help our supplier base, at time, this order is extended. NSTI
      continues to make no commitment or guarantee with regard to the
      actual quantity of product released under this purchase order.
      However, NSTI will take all of its purchase requirements during this
      period January through July 2009 from Global Minerals. The price
      shall be changed to a formula basis, as Ryan’s Notes Low for the
      month prior to the month of shipment plus $.39 per pound. . . . A
      price cap of $1.48 per pound . . . shall also be in effect. This change
      is confirmed with Dan Ritter on January 13, 2009 and per email
      proposal from Jim Yerkes to Dan Ritter dated January 9, 2009. By
      Jim Yerkes -January 15, 2009.

      After seeing the January PO, Ritter emailed Yerkes, “it looks like what we

discussed on the phone and email so lets get it going.”

      NSTI purchased only about 120 tons under the January PO. NSTI did not

purchase ferrosilicon from any other distributor, but it did take delivery of some of

its own stored inventory that had been purchased earlier from entities other than

Global.

      In November 2009, Global’s president Michael Xu contacted Yerkes to

request that NSTI extend the January PO to 2010 to purchase the remaining 400

tons of ferrosilicon Global was warehousing. After NSTI declined, Global filed

the instant breach-of-contract action naming as defendants NSTI and its parent




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company, NC.4

       Both parties moved for summary judgment. Global argued that each PO

was a separate contract and that the January PO could not be a modification to the

June PO because it was entered into after the time to perform under the June PO

had passed. Global also argued that NC was liable under agency theory. NSTI

argued that there was no breach because the January PO was an accord and

satisfaction and a substitute agreement. NSTI also noted that the January PO was

a requirements contract with no volume guarantee, and NSTI had adhered to the

terms by purchasing only from Global during the relevant time period. Finally,

NC argued that it was not liable because there was no agency relationship, it had

no role in the contracts, and there was no basis to pierce the corporate veil.

       The district court granted NSTI’s summary judgment motion, finding no

breach of contract. Specifically, the court found that there was only one contract –

the June PO – and the January PO was a change order to that contract. In reaching

this conclusion, the court considered the emails between Yerkes and Ritter leading

up to the January PO, but the court explained that it would reach the same result

       4
           Global filed its original complaint in the Southern District of New York, alleging
breach of contract, misrepresentation, breach of implied contract, and breach of the covenant of
good faith and fair dealing. The case was transferred to the Northern District of Alabama and the
district court granted NSTI’s motion to dismiss the claims of breach of implied-in-fact contract
and breach of the covenant of good faith and fair dealing. Global then filed an amended
complaint raising only a breach-of-contract claim and the claim against NC.

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even if confined to the “four corners” of the January PO. The court then found

that the January PO created a requirements contract, which contained neither an

estimate nor a specific quantity, but only a maximum purchase amount of 600

tons.5 The court concluded that NSTI had fulfilled its obligations under the

contract by taking all of its purchase requirements from Global, and there was no

evidence NSTI acted in bad faith. This is Global’s appeal.

                                               II.

       We review de novo the district court’s grant of summary judgment.

Robinson v. Tyson Foods, Inc., 595 F.3d 1269, 1273 (11th Cir. 2010). A district

court shall grant summary judgment “if the movant shows that there is no genuine

dispute as to any material fact and the movant is entitled to judgment as a matter of

law.” Fed. R. Civ. P. 56(a). “We draw all factual inferences in a light most

favorable to the non-moving party.” Shiver v. Chertoff, 549 F.3d 1342, 1343 (11th

Cir. 2008).

       In a diversity action such as this, we apply the substantive law of the forum

state, here Alabama, along with federal procedural law. Horowitch v. Diamond

Aircraft Industrs., Inc., 645 F.3d 1254, 1257 (11th Cir. 2011). Alabama has


       5
         Because the court found that there was no breach, it did not consider the claims against
NC. Global does not make any argument related to NC in its appellate brief and thus has waived
any claims. Access Now, Inc. v. Sw. Airlines Co., 385 F.3d 1324, 1330 (11th Cir. 2004).

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codified the Uniform Commercial Code governing the sale of goods. See, e.g. La

Trace v. Webster, 17 So.3d 1210, 1216 (Ala. Civ. App. 2008); see also Ala. Code

§ 7-2-102.

      Global argues that it entered into two separate and independent contracts,

one in June 2008 and another in January 2009, and that the district court erred by

concluding that the January PO was a substitution of the June PO. Global further

argues that the district court erred by considering the emails between Yerkes and

Ritter, and by finding that the 600 tons was a maximum amount rather than an

estimate. Global agrees that the January PO was a requirements contract, but

explains that NSTI breached it by taking a disproportionate reduction from its

estimated purchase or by acting in bad faith.

                                         III.

      A. The January PO

      We begin by determining whether the January PO constituted an

independent contract or simply a substitution for the June PO. In answering this

question, we consider whether the district court was limited to the four corners of

the PO or if it was permitted to consider extrinsic, or parol, evidence.

      To establish that the January PO is a substituted contract, we look at four

elements: “(1) a previous valid obligation; (2) an agreement of the parties thereto

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to a new contract or obligation; (3) an agreement that it is an extinguishment of the

old contract or obligation; and (4) the new contract or obligation must be a valid

one between the parties thereto.” Cook’s Pest Control, Inc. v. Rebar, 28 So.3d

716, 728 (Ala. 2009) (internal citations and quotation marks omitted) (discussing

the elements of a novation); see also Safeco Ins. Co of Amer. v. Graybar Elec. Co.,

Inc., 59 So.3d 649, 656 (Ala. 2010). (explaining that a novation and a substitute

contract are the same except a novation requires different parties). A “substituted

contract is one that is accepted in satisfaction of the original contract and thereby

discharges it.” Safeco Ins. Co of Amer., 59 So.3d at 656. “[W]hether there has

been a substituted contract depends upon the intention of the parties, which may

be determined by the facts and circumstances.” Id. at 657; see also Barnett v.

Quinn, 979 So.2d 816, 820 (Ala. Civ. App. 2007) (discussing requirements of a

valid accord and satisfaction).

      Whether a court may consider parol evidence to interpret the meaning of a

document depends on whether the document is ambiguous; if it is, parol evidence

is admissible. Vulcan Painters, Inc. v. MCI Constructors, Inc., 41 F.3d 1457,

1461 (11th Cir. 1995). In contrast to the limitations on extrinsic evidence,

documents that are incorporated by reference in the contract are admissible. Ex

parte Dan Tucker Auto Sales, Inc., 718 So.2d 33, 36 (Ala. 1998); see also

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Cavalier Mfg., Inc. v. Clarke, 862 So.2d 634, 640 (Ala. 2003) (“[A] contract may

incorporate the terms of another document by reference.” (internal citation and

quotation marks omitted)).

      Global contends that the district court erred by considering the emails

between Yerkes and Ritter. We disagree. The January PO specifically refers to

Global’s request to extend the June PO and to the emails between the two

companies. Thus, the emails are incorporated by reference and are not parol

evidence. Id. The district court was therefore permitted to consider these emails

when determining whether the January PO constituted an independent contract.

      The emails detail the negotiations between Global and NSTI after Yerkes

notified Ritter that NSTI would take no further deliveries of ferrosilicon. Ritter

expressed concern over taking a loss, but agreed to Yerkes’s offer to extend the

purchases through the first half of 2009. The emails establish a series of offers,

counter-offers, and acceptance of the January PO to off-set Global’s losses. Thus,

the emails establish all the elements of a substitute contract. See Cook’s Pest

Control, 28 So.3d at 728.

      The January PO itself confirms this conclusion. The PO has the words

“change order” stamped diagonally across the pages. It uses the same purchase

order number as the June PO, and the description indicates that it is an addendum.

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The text further states that it is an extension of the previous order, with the due

date changed to reflect the extension. And the above-market price is listed in the

text. Considering all of this evidence, there is no genuine issue of material fact

that the January PO was a substitution contract.

      B. Breach

      The next question before us is whether the district court properly concluded

that there was no breach of the substituted contract. The parties agree that the

January PO was a requirements contract.

      In a requirements contract, if an estimate of quantity is given, the buyer may

deviate from the stated quantity but must not take an amount “unreasonably

disproportionate” to the estimate. Ala. Code § 7-2-306 & cmt.3. In the absence of

an estimate, a breach can occur if the buyer did not act in good faith. See Simcala,

Inc. v. Amer. Coal Trade, Inc., 821 So.2d 197, 201 (Ala. 2001). Good faith allows

a buyer to deviate based on lack of orders but not merely because the buyer wishes

to curtail losses. Ala. Code § 7-2-306, cmt.2.

      Courts should construe contracts “so as to give meaning to all provisions

whenever possible.” Bd. of Water & Sewer Comm’rs of City of Mobile v. Bill

Harbert Constr. Co., 870 So.2d 699, 710 (Ala. 2003). “When interpreting a

contract, a court should give the terms of the agreement their clear and plain

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meaning and should presume that the parties intended what the terms of the

agreement clearly state.” Ex parte Dan Tucker Auto Sales, 718 So.2d at 36.

“Words used in a contract will be given their ordinary, plain, or natural meaning

where nothing appears to show they were used in a different sense or that they

have a technical meaning.” Id.

      Here, the January PO did not include an amount as an estimate of NSTI’s

needs. The January PO specifically stated that there was no commitment or

guarantee as to the actual quantity except that it would not exceed 600 [metric]

tons. Giving terms their ordinary meaning, the language “not to exceed” would

ordinarily indicate an upper limit rather than an estimate. Cf. Simcala, 821 So.2d

at 198 (stating that the language “the above [i.e. 17,500 tons] is an approximate

quantity” was an estimate and concluding that the buyer’s purchase of 7,200 toms

was unreasonably disproportionate).

      Because the January PO’s listed quantity was a maximum and not an

estimate, NSTI was not in breach for taking less than 600 tons so long as it acted

in good faith. Even construing the facts in the light most favorable to Global,

Global has not shown that NSTI acted in bad faith. NSTI did not purchase

ferrosilicon from any other company during the relevant time period. NSTI’s

decision to use some of its own stored inventory, which was consistent with the

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plain language of the contract, cannot amount to bad faith. Global has therefore

failed to establish a genuine issue of material fact about whether NSTI breached

the January PO.

      For the foregoing reasons, we affirm the order granting summary judgment

in favor of NSTI and NC.

      AFFIRMED.




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