WATER.IO LTD v. SEALED AIR CORP., 2025 NCBC 54

STATE OF NORTH CAROLINA
MECKLENBURG COUNTY
IN THE GENERAL COURT OF JUSTICE
SUPERIOR COURT DIVISION
24CV029851-590
WATER.IO LTD (f/k/a WaterIO Ltd.),
Plaintiff,
v.
SEALED AIR CORPORATION,
Defendant.
ORDER AND OPINION
ON DEFENDANT’S MOTION FOR
PARTIAL SUMMARY JUDGMENT
Robinson, Bradshaw & Hinson, P.A., by Edward F. Hennessey, IV,
Emma W. Perry, and Kelley Marie Storey, for Plaintiff Water.io Ltd
(f/k/a WaterIO Ltd.).
Moore & Van Allen PLLC, by Bruce J. Rose, Mark J. Wilson, Scott M.
Tyler, Clara Ilkka, Alexis Narducci, and Benjamin Austin, for Defendant
Sealed Air Corporation.
Conrad, Judge.
1. 	This case arises out of a dispute over a contract for the development and sale
of sensors for use in insulated shipping containers. Plaintiff Water.io Ltd. (the seller)
claims that Defendant Sealed Air Corporation (the buyer) wrongfully terminated
their contract in 2021. 	According to Water.io, its injuries were severe and went
beyond lost sales. 	The early, unexpected termination allegedly forced the company
to delay a planned initial public offering and decimated its valuation. 	Now, Sealed
Air has moved for partial summary judgment, arguing that Water.io may not recover
the decline in valuation as damages for breach of contract. 	(See ECF No. 48.) 	The
motion is fully briefed, and the Court held a hearing on 28 August 2025.
2. 	Summary judgment is appropriate “if the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the affidavits, if any, show that
Water.io Ltd v. Sealed Air Corp., 2025 NCBC 54.

there is no genuine issue as to any material fact and that any party is entitled to a
judgment as a matter of law.” N.C. R. Civ. P. 56(c). In deciding a motion for summary
judgment, the Court views the evidence in the light most favorable to the nonmoving
party and draws all inferences in its favor. See Vizant Techs., LLC v. YRC Worldwide,
Inc., 373 N.C. 549, 556 (2020); N.C. Farm Bureau Mut. Ins. Co. v. Sadler, 365 N.C.
178, 182 (2011).
3. 	The question to be decided is legal, not factual. For argument’s sake, Sealed
Air assumes that the termination of the parties’ contract derailed Water.io’s initial
public offering and reduced its valuation. 	Even if true, Sealed Air contends, any
damages due to devaluation are consequential (as opposed to direct or incidental)1
and nonrecoverable. According to Sealed Air, the Uniform Commercial Code (or UCC
for short) bars sellers from recovering consequential damages for breach of contract,
and the parties’ contract contains a limitation-of-liability clause stating that neither
shall be liable to the other for consequential damages.
4. 	Water.io concedes several points: devaluation damages are consequential;
the UCC does not enumerate consequential damages as a remedy for sellers; and the
parties’ contract excludes consequential damages. 	Even so, Water.io contends that
neither the UCC nor the contract precludes its recovery of consequential damages.
This is so, according to Water.io, because the common law supplements the UCC
1 “Consequential or special damages for breach of contract are those claimed to result as a
secondary consequence of the defendant’s non-performance. 	They are distinguished from
general damages, which are based on the value of the performance itself, not on the value of
some consequence that performance may produce.” Pleasant Valley Promenade v. Lechmere,
Inc., 120 N.C. App. 650, 671 (1995) (emphasis and citation omitted).

provisions regarding a seller’s remedies and because Sealed Air has forfeited any
right to enforce the contractual exclusion.
5. 	After careful review, the Court agrees with Sealed Air. 	The UCC does not
allow an aggrieved seller to recover consequential damages. 	And even if that were
not the case, Water.io bargained for and must abide by the limitation on liability in
the parties’ contract.
6. 	The statutory text is the place to begin. 	The UCC “applies to transactions
in goods,” such as Water.io’s sale of sensors to Sealed Air. 	N.C.G.S. § 25-2-102.
Several provisions detail the remedies available to buyers and sellers. 	In general,
“neither consequential or special damages nor penal damages may be had except as
specifically provided in this Chapter or by other rule of law.” 	Id. § 25-1-305(a)
(emphasis added). Although a few UCC provisions specifically allow buyers to recover
consequential damages for a breach, see, e.g., id. § 25-2-713, no provision allows
sellers to recover them, see id. §§ 25-2-703–10 (seller’s remedies). Thus, by their plain
terms, the statutes disallow consequential damages as a remedy for sellers.
7. 	Courts around the country have reached the same conclusion. As the Court
of Appeals for the Fourth Circuit has observed, “[t]he overwhelming majority of
jurisdictions recognize that under the U.C.C., an aggrieved seller may not recover
consequential damages.” Abex Corp./Jetway Div. v. Controlled Sys., 1993 U.S. App.
LEXIS 321, at *21 (4th Cir. Jan. 12, 1993) (reversing award of consequential
damages). “Whether New York, North Carolina, or, for that matter, South Carolina
law is applied, there is no circumstance where a seller of goods has the ability under

the UCC to seek consequential damages from a buyer.” Marion Mills, LLC v. Delta
Mills Mktg. Co., 2000 U.S. Dist. LEXIS 21263, at *22–23 (W.D.N.C. Dec. 14, 2000).2
8. 	Water.io maintains that consequential damages may be had as provided “by
other 	rule 	of 	law,” 	which 	it 	interprets 	to 	mean 	the 	common 	law. 	N.C.G.S.
§ 25-1-305(a). 	But 	the 	UCC 	makes 	clear 	that 	background 	principles 	of 	law
“supplement” 	its 	provisions 	only 	when 	not 	“displaced 	by” 	them. 	N.C.G.S.
§ 25-1-103(b). The UCC’s provisions on remedies for buyers and sellers are extensive
and meant to displace what came before them. 	Put another way, “[t]he measure of
damages is controlled by the applicable portions of the Uniform Commercial Code.”
Indus. Circuits Co. v. Terminal Comms., Inc., 26 N.C. App. 536, 541 (1975). There is
no room for the common law to add back in what the UCC’s drafters chose to leave
out. 	See, e.g., Firwood Mfg. Co. v. Gen. Tire, Inc., 96 F.3d 163, 172 (6th Cir. 1996)
(holding that “Michigan common law . . . cannot ‘supplement’ the types of damages
available to sellers”); Validsa, Inc. v. PDVSA Servs., 2009 U.S. Dist. LEXIS 139147,
2 There are too many similar cases to provide a complete list. See, e.g., Davidson Oil Co. v.
City of Albuquerque, 108 F.4th 1226, 1237 (10th Cir. 2024) (“[A] court may award a seller
incidental damages, but not consequential damages.”); Stamtec, Inc. v. Anson Stamping Co.,
LLC, 346 F.3d 651, 659 (6th Cir. 2003) (“[A] seller is not entitled to consequential damages.”);
Forthill Constr. Corp. v. Blue Acquisition, LLC, 2020 U.S. Dist. LEXIS 33727, at *4–5
(S.D.N.Y. Feb. 27, 2020) (“Consequential damages are thus specifically carved out of the
damages available under the UCC absent a specific provision authorizing them.”); Dietec Co.
v. Osirius Grp., LLC, 2017 U.S. Dist. LEXIS 200276, at *16 (E.D. Mich. Dec. 6, 2017) (“In
other words, the drafters of the UCC explicitly provided that buyers were entitled to both
incidental and consequential damages but limited sellers to incidental damages.”); Twin
Creeks Ent. v. U.S. JVC Corp., 1995 U.S. Dist. LEXIS 2413, at *16 (N.D. Cal. Feb. 22, 1995)
(“[C]ourts have consistently concluded that sellers may not recover consequential damages
under the U.C.C.”); Atl. Aviation Corp. v. Provident Life & Accident Ins. Co., 1989 U.S. Dist.
LEXIS 10261, at *20–21 (D. Del. Aug. 2, 1989) (“[T]he sections covering a seller’s damages
provide 	only 	for 	incidental 	damages,” 	meaning 	a 	seller 	“is 	not 	entitled 	to 	recover
consequential damages.”).

at *6 (S.D. Fla. Jan. 28, 2009) (holding that “the common-law does not provide an
avenue for a seller’s recovery of consequential damages under the Florida UCC”).
9. 	Whether this is bad policy and unfair to sellers, as Water.io contends, is for
the General Assembly to decide. The Court must apply the UCC as written. By its
plain terms, the UCC bars Water.io’s request for devaluation damages. 	That alone
is a sufficient basis to grant Sealed Air’s motion.
10. 	There is also a second, independent reason to grant the motion: Water.io
bargained away its right to recover consequential damages. The parties’ contract is
crystal clear. It unequivocally states that “neither party shall be liable to the other
party . . . for any special, punitive, indirect, incidental or consequential damages of
any kind . . . arising out of or in connection with the performance of this agreement.”
(Purch. Agrmt. § 9, ECF No. 12.6 (all caps omitted).)
11. 	Water.io does not dispute the validity of this clause or its meaning. Rather,
it contends that Sealed Air has forfeited any right to enforce the clause. 	Sealed Air
has supposedly taken inconsistent positions by opposing Water.io’s demand for
consequential damages while seeking to recover consequential damages for its own
counterclaims (and making a similar damages demand in a parallel federal case that
has since been dismissed). According to Water.io, Sealed Air is either estopped from
enforcing or has waived any right to enforce the contractual damages limitation.
12. 	The purpose of estoppel and estoppel-like doctrines is to prevent parties
from changing their litigating positions in a way that threatens judicial integrity or
would result in some unfair advantage. See, e.g., Whitacre P’ship v. BioSignia, Inc.,

358 N.C. 1, 29 (2004). Nothing of the sort has happened here. 	Whether Sealed Air
has made a demand for consequential damages in its pleadings is debatable. 	But
even if it had, at no point has it attempted to persuade the Court to award
consequential damages or to exempt it from the contractual damages limitation. No
threat to judicial integrity is apparent. Nor will Sealed Air gain any unfair advantage
by prevailing on its motion. In this circumstance, equity favors upholding the parties’
agreement and applying its limitation-of-liability clause equally to both sides. 	This
is the result that levels the playing field in the litigation. 	And it gives Water.io
exactly what it bargained for.
13. 	For similar reasons, Sealed Air has not waived its contractual right.
“Waiver is the intentional surrender of a known right or privilege, which surrender
modifies other existing rights or privileges or varies the terms of a contract.” Lenoir
Mem’l Hosp., Inc. v. Stancil, 263 N.C. 630, 633 (1965). 	Sealed Air’s demand for
damages, which it denies are consequential in nature, is hardly an intentional
surrender of any right granted by the contract’s limitation-of-liability clause.
14. 	Accordingly, the Court GRANTS Sealed Air’s motion for partial summary
judgment. 	Water.io may not recover consequential damages resulting from Sealed
Air’s alleged breach of contract. See Crescent Univ. City Venture, LLC v. AP Atl., Inc.,
2019 NCBC LEXIS 46, at *56 (N.C. Super. Ct. Aug. 8, 2019) (granting summary
judgment as to consequential damages).

SO ORDERED, this the 5th day of September, 2025.
/s/ Adam M. Conrad
Adam M. Conrad
Special Superior Court Judge
for Complex Business Cases