Topic: Butterfly Labs Forced "On Hold For Refund" for all my Single SC orders - page 16. (Read 59168 times)

Fortunately, drafters of the UCC thought even about this:


A judge will be considering whether in light of an indicated delivery time of October 2012, non-delivery by May 2013 is "reasonable." All I can say that I would not want to be counsel for BFL at that hearing...

400.2-309. (1) The time for shipment or delivery or any other action under a contract if not provided in this article or agreed upon shall be a reasonable time.

Sure.


I agree.


Fortunately, drafters of the UCC thought even about this:


A judge will be considering whether in light of an indicated delivery time of October 2012, non-delivery by May 2013 is "reasonable." All I can say that I would not want to be counsel for BFL at that hearing...

That is precisely what a "forward contract" is. It is a contract of sale between private parties for future goods at a fixed price. A "future contract" is a standardized forward contract offered by exchanges.
More about them here: http://www.investopedia.com/ask/answers/06/forwardsandfutures.asp

Btw almost done with the discussion in the legal forum. drlukacs, do you want me to just start a thread in the legal section and point to it here?

I would add to this that in the case of the car purchase there would be an explicit contract with cancellation clauses and the details of that would regulate a situation.

Additionially the wording on the site at the time of the order:

http://web.archive.org/web/20120628113158/http://www.butterflylabs.com/order-form-bitforce-sc-single/

Explicitly states: "currently scheduled for October"

This wording in so vague and implies that the date will and can change. .. there is little room to say that they promised to deliver the products sooner and the buyer was unaware that it wasn't a risk factor

400.2-309. (1) The time for shipment or delivery or any other action under a contract if not provided in this article or agreed upon shall be a reasonable time.

Customer goes to a car dealership, picks the car he wants but it isn't in stock, so he's told it will be delivered in 2 months, and he pays the current price for the car in full at that point in time. 2 months pass, and the car he ordered is delivered to the dealership. The dealership sees that he can sell the same car to a new buyer for 67% more. So he calls up the original customer and says, sorry, I changed my mind, you can't have that car after all, because I'd rather sell it to someone else for more money. Here's your money back.

I would be hesitant to characterize the sale as a "forward contract". I would be inclined to characterize it as a sale of future goods (emphasis added):

Nope I am still here. Waiting for that bet to be clarified.

To summarize the legal position of Xian:

The contract that Xian and BFL entered into was not a normal sale, nor was it a pre-order. Pre-orders involve either deposits or credit-card authorizations, but not the full amount (at least according to Amazon, Barnes & Noble, Ebay, Newegg, Best Buy, and Apple). If you order something that is not in stock, the online retailer will not charge your credit card until they ship the product. The contract entered into with BFL was called a foward sale.

An example of a forward sale is a farmer agreeing to sell soybeans a year from now to ADM for $540 a ton. Suppose that when the soybeans are finally ready the market price for soybeans is $800 a ton. The farmer is still obligated to sell them to ADM for $540. The farmer cannot legally unilaterally void the contract then refund the $540 to ADM and turn around and sell his soybeans to someone else for $800.

However, this is precisely what BFL did. They agreed to a contract to sell a specified amount of future units for a specified price. The market price of the contract rose five-fold. BFL then canceled the contract without compensating Xian for the fair market value. Finally, they turned around and sold the merchandise that Xian had rights to for more money to someone else (again via forward sale, but for a higher price than Xian paid).

Moreover, BFL does not support purchase of their products with credit cards. Why? For the simple reason that the credit card companies would not let them have pre-orders longer than 30 days, would not let them charge the full amount without delivery of product, and will come after them with lots of lawyers if they tried to do so.

Definitions--transferability--"goods"--"future" goods--"lot"--"commercial unit".

400.2-105. (1) "Goods" means all things (including specially manufactured goods) which are movable at the time of identification to the contract for sale other than the money in which the price is to be paid, investment securities (article and things in action. "Goods" also includes the unborn young of animals and growing crops and other identified things attached to realty as described in the section on goods to be severed from realty (section 400.2-107).

(2) Goods must be both existing and identified before any interest in them can pass. Goods which are not both existing and identified are "future" goods. A purported present sale of future goods or of any interest therein operates as a contract to sell.

An example of a forward sale is a farmer agreeing to sell soybeans a year from now to ADM for $540 a ton. Suppose that when the soybeans are finally ready the market price for soybeans is $800 a ton. The farmer is still obligated to sell them to ADM for $540. The farmer cannot legally unilaterally void the contract then refund the $540 to ADM and turn around and sell his soybeans to someone else for $800.

However, this is precisely what BFL did. They agreed to a contract to sell a specified amount of future units for a specified price. The market price of the contract rose five-fold. BFL then canceled the contract without compensating Xian for the fair market value. Finally, they turned around and sold the merchandise that Xian had rights to for more money to someone else (again via forward sale, but for a higher price than Xian paid).

To summarize the legal position of Xian:

The contract that Xian and BFL entered into was not a normal sale, nor was it a pre-order. Pre-orders involve either deposits or credit-card authorizations, but not the full amount (at least according to Amazon, Barnes & Noble, Ebay, Newegg, Best Buy, and Apple). If you order something that is not in stock, the online retailer will not charge your credit card until they ship the product. The contract entered into with BFL was called a foward sale.

An example of a forward sale is a farmer agreeing to sell soybeans a year from now to ADM for $540 a ton. Suppose that when the soybeans are finally ready the market price for soybeans is $800 a ton. The farmer is still obligated to sell them to ADM for $540. The farmer cannot legally unilaterally void the contract then refund the $540 to ADM and turn around and sell his soybeans to someone else for $800.

However, this is precisely what BFL did. They agreed to a contract to sell a specified amount of future units for a specified price. The market price of the contract rose five-fold. BFL then canceled the contract without compensating Xian for the fair market value. Finally, they turned around and sold the merchandise that Xian had rights to for more money to someone else (again via forward sale, but for a higher price than Xian paid).

Moreover, BFL does not support purchase of their products with credit cards. Why? For the simple reason that the credit card companies would not let them have pre-orders longer than 30 days, would not let them charge the full amount without delivery of product, and will come after them with lots of lawyers if they tried to do so.