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Sunbeam Products, Inc.,Doing Business As Jarden Consumer Solutions v. Chicago American Manufacturing, LLC

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ARGUED MAY 22, 2012–

Before EASTERBROOK, Chief Judge, and WILLIAMS and TINDER, Circuit Judges.

Lakewood Engineering & Manufacturing Co. made and sold a variety of con- sumer products, which were covered by its patents and trademarks. In 2008, losing money on every box fan, Lakewood contracted their manufacture to Chicago American Manufacturing (CAM). The contract au- thorized CAM to practice Lakewood’s patents and put its trademarks on the completed fans. Lakewood was to take orders from retailers such as Sears, Walmart, and Ace Hardware; CAM would ship directly to these customers on Lakewood’s instructions. Because Lakewood was in financial distress, CAM was reluctant to invest the money necessary to gear up for produc- tion–and to make about 1.2 million fans that Lakewood estimated it would require during the 2009 cooling season–without assured payment. Lakewood provided that assurance by authorizing CAM to sell the 2009 run of box fans for its own account if Lakewood did not purchase them.

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