Gregory Funding LLC v. Saksoft, Inc.
United States District Court for the District of Oregon
2016 WL 4480693 (2016)
Gregory Funding (plaintiff) contracted with Saksoft (defendant), identified in the agreement as a "Service Provider," to develop custom software from concept to completion, paying Saksoft based on hours worked by a staffing team Saksoft controlled; after years of dissatisfaction with staffing changes and delays, Gregory declared the project a failure, hired its own analyst, withheld payment on outstanding invoices, and sued for breach of contract and breach of warranty, with the warranty claims available only under Oregon's UCC governing sales of goods. Saksoft moved to dismiss the warranty claims, arguing the contract was predominantly for services.
Whether a custom software-development contract, under which the developer is paid based on hours worked and is described as a service provider, is governed by the UCC as predominantly a contract for the sale of goods, or is instead predominantly a services contract outside the UCC's scope.