Watson Laboratories, Inc. v. Rhone-Poulenc Rorer, Inc.
178 F. Supp. 2d 1099 | District Court, C.D. California | 2001
What This Case Means for Subcontractors
Watson Laboratories sued Rhone-Poulenc for failing to supply a drug and competing in the same market. Rhone-Poulenc claimed a force majeure event (unforeseeable circumstance) excused their breach. The court ruled that force majeure cannot excuse breach when the triggering event was foreseeable at the time the contract was signed, or when the breaching party had reasonable control over the situation. This means you cannot use unexpected events as an excuse if you should have seen them coming or could have prevented them.
Key Takeaways
- •Force majeure clauses only protect you from truly unforeseeable events—not ones that were predictable when you signed the contract
- •If you had reasonable control over the problem (like managing your own facility), you cannot claim force majeure as a defense
- •Review your force majeure language carefully: it must specifically list what events qualify, or courts will interpret it narrowly against you
- •Document what was foreseeable at contract signing; if you knew a risk existed, you cannot later claim it as force majeure
Force majeure event must be unforeseeable at time of contracting unless specifically agreed.
Frequently Asked Question
Can I use force majeure to get out of my supply contract if something unexpected happens?
Only if the event was truly unforeseeable when you signed the contract and you had no reasonable way to control or prevent it. If you could have anticipated the problem or had control over the situation, the court will not let you use force majeure as an excuse. Make sure your contract specifically lists which events qualify as force majeure.
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