Breach of Contract – Statue of Limitations

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7^th Circuit Court of Appeals

Case Name: Pain Center of SE Indiana LLC, et al. v. Origin Healthcare Solutions LLC, et al.

Case No.: 17-1276

Officials: WOOD, Chief Judge, and ROVNER and SYKES, Circuit Judges.

Focus: Breach of Contract – Statue of Limitations

In June 2003 Pain Center of SE Indiana contracted with a company called SSIMED LLC for medical-billing software and related services. In June 2006 the parties entered into a second contract, this time for records-management software and related services. Almost seven years later—in January 2013—Pain Center sued SSIMED raising multiple claims for relief, including breach of contract, breach of warranty, breach of the implied duty of good faith, and four tort claims, all arising out of alleged shortcomings in SSIMED’s software and services.

The district judge found the entire suit untimely and entered summary judgment for SSIMED. We affirm on all but the claims for breach of contract. The judge applied the four year statute of limitations under Indiana’s Uniform Commercial Code (“UCC”), holding that the two agreements are mixed contracts for goods and services, but the goods (i.e., the software) predominate. We disagree. Under Indiana’s “predominant thrust” test for mixed contracts, the agreements in question fall on the “services” side of the line, so the UCC does not apply. The breach-of-contract claims are subject to Indiana’s ten-year statute of limitations for written contracts and are timely. The suit may go forward only on those claims.

Affirmed

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Attorney Derek A. Hawkins is the managing partner at Hawkins Law Offices LLC, where he heads up the firm’s startup law practice. He specializes in business formation, corporate governance, intellectual property protection, private equity and venture capital funding and mergers & acquisitions. Check out the website at www.hawkins-lawoffices.com or contact them at 262-737-8825.