International Business Machines Corporation v. Lufkin Industries, LLC

Summary

The Supreme Court of Texas held that contractual reliance disclaimers barred Lufkin Industries from recovering for fraudulent inducement and related “string-along fraud” claims based on IBM’s alleged misrepresentations. The Court also held that the evidence conclusively established that IBM’s breach of contract caused Lufkin some damages, requiring a new trial on the breach-of-contract claim. The judgment was reversed in part and the case was remanded.

Holdings

1. Lufkin's contractual provisions clearly and unequivocally disclaimed reliance on IBM's alleged misrepresentations, and the disclaimers therefore barred recovery for fraudulent inducement.
2. Lufkin could not recover on its string-along fraud claim because the claim was substantively a fraudulent-inducement claim and the contractual reliance disclaimers applied to the project-change requests.
3. Lufkin was entitled to a new trial on its breach-of-contract claim because the evidence conclusively established that IBM's breach caused Lufkin some amount of damages, although it did not conclusively establish the amount of damages.

Questions Presented

1. Whether Lufkin's contractual reliance disclaimers barred recovery for fraudulent inducement based on IBM's precontractual misrepresentations.
2. Whether the same contractual disclaimers barred Lufkin's so-called string-along fraud claim based on IBM's postcontractual representations inducing project-change requests.
3. Whether the evidence conclusively established that IBM's breach of contract caused Lufkin some damages despite the jury's zero-damages finding, and whether a new trial was required on contract liability and damages.

Disposition

reversed_and_remanded