Overview
On September 8 the Wisconsin Supreme Court heard argument on a question this state has never answered: whether a clause limiting a seller’s damages must be conspicuous to be enforced. The clause caps recovery at the purchase price, and it sits in the middle of a paragraph captioned “Warranty.”
The hour belonged to the architecture of that single paragraph and to what remains of Phillips Petroleum Co. v. Bucyrus-Erie Co., the 1986 decision stating that a damages limitation inappropriately masked under a warranty heading may be disregarded for that reason alone.1 An amicus asked the Court to overrule that language. Counsel for the seller declined to join the request.
What You Should Know
Four things to carry into the decision
- Wisconsin has never decided whether a limitation-of-damages clause must be conspicuous. The Code imposes that requirement on warranty disclaimers; whether it reaches a damages cap is open, and counsel for Viking Masek conceded as much from the podium.2
- The contract set no delivery date and said time was not of the essence. Three years passed. The machine never arrived. Buddy’s rescinded and sued.
- The circuit court found breach for unreasonable delay and awarded the purchase price, but held consequential and lost-profit damages both barred by contract and independently unproven. The court of appeals affirmed and never reached damages. Judge Grogan dissented.3
- Require a cap to stand under its own heading and a generation of short-form supply contracts becomes vulnerable. Hold that operative language governs regardless of caption and Phillips loses the sentence courts have cited for forty years.
The Two Readings of Paragraph 6
Paragraph 6 does three things in sequence: it imposes a repair-or-replace duty, it addresses failure to supply or malfunction of the equipment, and it caps recovery. A second sentence makes the warranty the buyer’s sole remedy.
A cap of that reach cannot sit unmarked
A limitation capping recovery at the purchase price cannot sit unmarked under a warranty caption. Phillips says a limitation inappropriately masked under a warranty heading can be disregarded for that reason alone, and Judge Grogan’s dissent read it as controlling.
The language beneath a heading controls
The operative text governs, not the caption above it. The Code requires conspicuousness for warranty disclaimers (§ 402.316(2)) and imposes a different test on damages limits — unconscionability, and failure of essential purpose.
What Happened
Buddy’s Plant Plus packages consumer products, Scotts Miracle-Gro chief among them. Click any step for detail.
One machine Buddy’s did not have
When Scotts brought out a bed bug lure, Buddy’s built a line to package it and needed a stick pack machine — automated equipment that meters powders or liquids into sealed plastic sticks.
Viking Masek comes in lowest
Buddy’s solicited bids. Viking Masek came in lowest and held itself out as an expert.
No delivery date; time not of the essence
The contract obligated both parties to cooperate through the build, but set no delivery date and stated that time was not of the essence.
“That was it”
Three years passed between signature and the day Buddy’s said that was it. The machine never arrived.
Breach found; purchase price awarded
The court found Viking Masek in breach for unreasonable delay and awarded the purchase price. It held that consequential and lost-profit damages were both barred by the contract and independently unproven — resting on hearsay, lacking foundation, and speculative.
Court of appeals affirms; Grogan dissents
District II affirmed on the contract terms and never reached damages.3
The dispute turns on paragraph 6, captioned “Warranty.” That paragraph does three things in sequence: it imposes a repair-or-replace duty, it addresses failure to supply or malfunction of the equipment, and it caps recovery, providing that the seller’s maximum liability is limited to the amount paid to the seller. A second sentence makes the warranty the buyer’s sole remedy. Buddy’s argues that a limitation of that reach cannot sit unmarked under a warranty caption. Viking Masek argues that the language beneath a heading controls, not the heading itself.
Legal Background
The Code draws a line the parties spent the hour testing. A seller who wants to disclaim an implied warranty must do so conspicuously. Wis. Stat. § 402.316(2). A seller who wants to limit or exclude consequential damages faces a different test: the limitation stands unless it is unconscionable, § 402.719(3), and it gives way when an exclusive or limited remedy fails of its essential purpose, § 402.719(2).
Nothing in § 402.719 says a damages cap must be conspicuous. Whether the conspicuousness requirement migrates from one provision to the other is the question presented.2
Phillips is the pressure point. Forty years ago this Court observed that a disclaimer of liability or limitation on damages inappropriately masked under a heading captioned “Warranty” can be disregarded. Lower courts have cited that sentence ever since. The court of appeals majority distinguished it on the facts; Judge Grogan’s dissent read it as controlling and as supplying the conspicuousness rule the majority declined to apply.
Key Exchanges
Summarized from the argument rather than quoted. Speakers are identified as the argument record identifies them.
Asked why a remedy for breach of contract would sit in a paragraph titled “Warranty” at all, and whether placing it there was, in her word, sneaky.
Did not dispute that a limitation on damages inappropriately masked under a warranty heading can be disregarded, but argued that Phillips should not be read as creating an entirely separate test.
Declined to join the amicus request that the Court overrule the Phillips language, saying the focus was the client and this contract and taking no position on overruling.
Established that the circuit court’s unreasonable-delay finding went to production of the machine rather than to the refund, which the court regarded as reasonable in the circumstances.
Zoom In
The sharpest exchange came from Justice Taylor, who asked why a remedy for breach of contract sits in a paragraph titled “Warranty” and whether that was, in her word, sneaky. That question is not really about this contract. It is about whether Wisconsin will police the placement of commercial terms or leave placement to the parties who sign them.
Justice Crawford pressed whether the limited remedy failed of its essential purpose under § 402.719(2); Viking Masek answered that the circuit court found unreasonable delay, not failure of the remedy, and that had it found the latter it would have allowed further damages.
Justice Hagedorn narrowed the record to the same point, establishing that the unreasonable-delay finding went to production of the machine rather than to the refund. Counsel conceded that a contract silent on delivery does not give the seller unlimited time.
The bench framed the merits through Judge Grogan’s dissent, paraphrased from the bench as: we have this language, this is what it says, so how are we not supposed to follow it.
That framing cuts in Buddy’s favor on the text of paragraph 6 and in Viking Masek’s favor on the text of the cap. Only one of them can have it.
The court of appeals never reached damages, and Viking Masek pressed hard on the failure of proof at trial: hearsay, no foundation, and a two-page spreadsheet prepared by an accountant who never testified.
It also argued the finding is reviewed deferentially after a bench trial, a point Justice Hagedorn raised on his own. The Court can affirm on that ground alone and leave Phillips untouched.
What’s Next
The stakes reach every commercial contract drafted in this state.
Drafters restructure
A large stock of existing short-form supply agreements becomes vulnerable.
Phillips loses its sentence
The line courts have cited for forty years goes, and freedom of contract between sophisticated parties carries the day.
Affirm on failure of proof
The Court can resolve the case on the damages findings alone and leave Phillips untouched.
Watch whether any justice takes up the amicus invitation counsel declined to press. A party that refuses to ask for overruling gives the Court room to do it anyway, and room not to.
Endnotes & Authorities · 3 citations
- Buddy’s Plant Plus Corp. v. Viking Masek Global Packaging Technologies, LLC, No. 2023AP2428, argued September 8, 2026. Phillips Petroleum Co. v. Bucyrus-Erie Co., 131 Wis. 2d 21, 388 N.W.2d 584 (1986).
- Wis. Stat. § 402.316(2) (conspicuousness required to exclude or modify implied warranties); § 402.719(2) (failure of essential purpose); § 402.719(3) (limitation of consequential damages).
- On review from the Court of Appeals, District II, affirming the Sheboygan County Circuit Court (Limbeck, J.). Neubauer, J., wrote for the panel, joined by Lazar, J.; Grogan, J., dissented. No. 2023AP2428 (Wis. Ct. App. July 30, 2025) (recommended for publication).