FSTI v. PVS Minibulk, 2026 Tex. Bus. 73 (3d Div.) (mem. op.)

2026 Tex. Bus. 73
The Business Court of Texas,
Third Division
FSTI, INC.,
Plaintiff,
v.
PVS MINIBULK, INC., et al.,
Defendants.
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Cause No. 26-BC03A-0010
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Memorandum Opinion
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¶1 On September 25, 2026, the Court issued an order that, among other
things, DENIED Plaintiff’s Traditional Motion for Summary Judgment on DPC’s
Claims (FSTI’s MSJ) and GRANTED Defendants’ Amended Motion for Summary
Judgment on FSTI’s Termination Defense (Defendants’ Termination MSJ).1 The
Court now issues this related opinion.
1 Additional summary-judgment briefing cited herein includes: Defendants’ Response to FSTI’s
MSJ (Def. Resp.); FSTI’s Reply in Support of FSTI’s MSJ (FSTI Reply); FSTI’s Response to
Defendants’ Termination MSJ (FSTI’s Term. Resp.); Defendants’ Reply in Support of Defendants’
MSJ (Def. Term. Reply); Defendants’ Motion for Summary Judgment on FSTI’s Claim that DPC
Breached its Obligation to Buy Bleach (Defs.’ MSJ); FSTI’s Response to Defendants’ MSJ (FSTI
Resp.); and Defendants’ Reply in support of Defendants’ MSJ (Def. Reply).

2
Introduction
¶2 In Count II of Defendants’ Counterclaims, DPC asserts that FSTI
repudiated and breached the Bulk Contract when it sold its bleach-production
facility to a third party. In FSTI’s MSJ, FSTI argues that claim fails as a matter of
law because DPC breached Section 3 of the Bulk Contract by failing to send FSTI
shipping instructions each month, and DPC’s breach gave FSTI the right to cancel
the contract under Section 19 of the Bulk Contract (FSTI’s “termination defense”).
In Defendants’ Termination MSJ, Defendants argue that FSTI’s termination
defense fails as a matter of law because Section 3 did not apply, and even if FSTI
had been entitled to cancel the contract, it failed to do so. Thus, both motions turn
on the same two issues: whether DPC breached Section 3 and whether FSTI timely
cancelled the contract. The Court holds that DPC did not breach Section 3 of the
Bulk Contract and therefore does not reach the second issue. Specifically, the Court
holds that Section 3 of the Bulk Contract’s general terms and conditions, which were
cut and pasted from another contract, cannot reasonably be construed to require
DPC to send monthly shipping instructions to FSTI when the front page of the
contract, containing the contract-specific terms negotiated by the parties,
unambiguously required DPC to pick up the goods at the production facility and
placed all shipping responsibility on DPC. Under the contract, FSTI had no duty to
provide shipping, and DPC had no duty (or right) to instruct FSTI to do so.

3
Background
¶3 The Bulk Contract. In October 2021, FSTI, Inc. (FSTI) and PVS DX,
Inc. (DPC), entered into a ten-year supply agreement (the Bulk Contract) under
which DPC agreed to buy 100% of the bleach FSTI produced at its Greenville facility,
excluding amounts used for retail and minibulk sales—i.e., 100% of the “bulk”
bleach.2 The parties agree that the Bulk Contract is an “output contract” governed
by Chapter 2 of the Texas Business & Commerce Code (the UCC).3
¶4 The Bulk Contract is composed of three pages. The first page identifies
FSTI and DPC as the seller and buyer, has the contract-specific terms, and is signed
by the parties.4 It sets out the product sold under the contract, the purchase quantity,
the contract price, and the contract term, as well as several shipping provisions:
5
2 Def. MSJ Exh. A, Greenville Supply Agreement (Bulk Contract) at 1. The term “bulk bleach,” as
used in this opinion, refers to the bleach that qualifies for sale under the terms of the Bulk Contract.
3 Def. MSJ Exh. H, Plaintiff’s First Amended Petition, Original Answer to Counterclaims, and
Affirmative Defenses (First Am. Pet.) at ¶¶ 18, 39; Def. MSJ at 5; see also TEX. BUS. & COM. CODE
§ 2.306(a); Lenape Res. Corp. v. Tenn. Gas Pipeline Co., 925 S.W.2d 565, 569 (Tex. 1996) (“An
output contract is one in which the buyer agrees to buy the seller’s entire output of production.”).
4 Bulk Contract at 1.
5 Id.
F.O.B. Point: Seller’s facility in Greenville TX
Freight Terms: Buyer’s account
Mode: Bulk truckload
Additional Provisions: Buyer may park up to 3 tractor/trailers for
delivering [bleach] on the Seller plant site. …

4
¶5 The signed page one is followed by two pages of preprinted terms and
conditions (§§ 1–19) that were “cut and paste[d]” from an existing form used by an
affiliated entity.6 Of these, Sections 3 and 19 are relevant here. They provide:
7
¶6 The Parties’ Performance. The parties operated under the Bulk
Contract for over two years, with DPC purchasing millions of gallons of bleach from
6 Def. Resp. Exh. 18; Def. MSJ Exh. A; FSTI MSJ Exh. 1, Kurt Filer Deposition (Filer Depo.), at
69–70, 72; see generally Bulk Contract.
7 Bulk Contract at §§ 3, 19.
3. SHIPPING INSTRUCTIONS: On or before the 20th day of
each month, Buyer shall furnish written shipping instructions for
the quantity required during the next succeeding month. Seller
shall have no obligation for any quantities for which Buyer has
not given such shipping instructions.
19. DEFAULT: BANKRUPTCY: Upon failure of Buyer to make
any payment required hereunder, without deduction, set off or
counterclaim, within ten (10) days after the same becomes due,
or if Buyer defaults in the performance of any other obligation,
term or condition of this Contract, or if Buyer shall make an
assignment for the benefit of creditors, or in the event of a
commencement of proceedings by or against Buyer involving
bankruptcy, insolvency, reorganization or arrangement, Seller,
without demand or notice of any kind and without prejudice to
any other remedy of Seller, may cancel this and any other
contracts with Buyer (Buyer remaining liable for damages) or
Seller may defer further deliveries until the default is remedied
(in which event, if Seller elects, this Contract shall be deemed
extended for a period of time equal to that during which
deliveries are deferred).

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FSTI.8 At the outset of the Bulk Contract, FSTI sent DPC an email stating, “we need
to have communication daily that tells you [DPC] what we [FSTI] have so it can be
moved and the plant can maintain its operating rate.”9 Consistently, throughout
their performance under the Bulk Contract, the parties communicated on a day-to-
day basis about FSTI’s bleach production and inventory and DPC’s order pickups.10
Both parties understood the Bulk Contract to require DPC to pick up the bleach at
the Greenville facility, which DPC did.11 There were a few occasions on which the
bleach was transported by FSTI’s two trailers, but DPC arranged and paid for this
transportation under a separate carrier agreement between DPC and FSTI.12
Witnesses from both sides testified that DPC purchased all of the bulk bleach FSTI
actually produced at the Greenville facility during the contract term.13
¶7 The HASA sale. In February 2024, FSTI sold the Greenville facility to
a third party, HASA, Inc., but excluded from the sale the Bulk Contract and another
8 See Def. MSJ Exh. F; Def. Resp. Exh. 24.
9 Def. Resp. Exh. 7.
10 See, e.g., FSTI MSJ Exh. 12, Nicole Chambers Deposition (Chambers Depo.), at 109; FSTI MSJ
Exh. 3, DPC Corporate Representative Deposition (DPC Corp. Rep. Depo.), at 134–35.
11 Def. Resp. Exh. 3, Stoney Barton Deposition (Stoney Depo.), at 150; Filer Depo. at 36;
Defendants’ Termination MSJ Exh. 16 at 201; Defendants’ Termination MSJ Exh. 29; Chambers
Depo. at 120; Def. Resp. Exh. 30, David Byrd Deposition (PVS Byrd Depo.), at 40–41.
12 DPC Corp. Rep. Depo. at 80:6–9; Def. Resp. Exh. 15, April 20, 2026 Temporary Injunction
Hearing Transcript (4.20.26 TI Trans.), at 312–14; see also Def. Resp. Exh. 16.
13 Chambers Depo. at 61; DPC Corp. Rep. Depo. at 222–23; Filer Depo. at 77–78, 102.

6
contract also at issue in this lawsuit, the Minibulk Contract.14 Effectively, FSTI
retained the Bulk and Minibulk Contracts without any means for performing under
the contracts. According to Defendants, the exclusion of these contracts enabled
FSTI to increase the sale price of the Greenville facility by more than $15 million.15
The HASA sale agreement is dated February 15, and parties disagree about whether
the sale closed on the same day or the next day, February 16.
¶8 FSTI made the decision not to inform Defendants about the HASA sale
beforehand.16 On February 16, representatives of HASA and FSTI called John
Cannon, the president of Defendant PVS Minibulk, Inc. (PVS), an affiliate of DPC.17
Cannon testified that in this call he was informed of the HASA sale and reassured
that “everything was going to stay the same,” “nothing was going to change, and it
was going to be business as usual.”18 HASA and FSTI did not contact anyone from
DPC directly.19 But after they called Cannon, Cannon called Kurt Filer, the president
14 Defendants’ Termination MSJ Exh. 11, Asset Purchase Agreement (HASA Agmt.) at 1, Exh. 12,
Schedule 2.02(c).
15 Defendants’ Second Amended Answer and Counterclaims (Second Am. Counterclaims) at ¶ 44.
16 Def. Termination MSJ Exh. 18, Stormey Barton Deposition (Stormey Depo.), at 150.
17 Def. Termination MSJ Exh. 13, John Cannon Deposition (Cannon Depo.), at 110–11.
18 Id. at 111, 112.
19 Def. Termination MSJ Exh. 7, Scott Trussell Deposition (Trussell Depo.), at 203.

7
of DPC, and informed him of the HASA sale.20 At that time, no one informed DPC
that its Bulk Contract had been excluded from the sale.21
¶9 For the first month after the HASA sale, DPC continued to make
arrangements for bleach purchases through FSTI at the contract price—“business
as usual.”22 Then on March 15, DPC received a response to an order email stating
that “HASA, Inc. is your vendor for this delivery” and instructing that further
orders be sent to a new point of contact at HASA.23 DPC then began placing its
Greenville facility bulk bleach orders with HASA instead of FSTI, and for several
more months, HASA supplied that bleach at the Bulk Contract price.24 But HASA
eventually refused to honor the contract price, informing DPC that the Bulk
Contract had been excluded from the HASA sale.25
20 Filer Depo. at 175.
21 4.20.26 TI Trans., at 234–35. FSTI asserts that, on February 16, 2024, “DPC understood that
FSTI was no longer selling bleach from the Plant and that ‘Hasa owned the plant and was selling
the bleach.’ And DPC was told that same day that ‘the contracts were not assigned to Hasa as part
of the sale.’” FSTI MSJ at 14 (citing Exh. 8 to FSTI’s ELI Br., John Cannon’s deposition as PVS’s
corporate representative (PVS Corp. Rep. Depo.) at 21:5-20, 24:3-25). But the deposition testimony
FSTI cites is Cannon’s testimony about what PVS was told, not what Cannon subsequently
conveyed to Filer at DPC. Filer’s testimony about what was conveyed to him by Cannon in their
subsequent phone call does not include this information. See 4.20.26 TI Trans. at 234–35; Filer
Depo. at 175. FSTI has not pointed to any evidence contradicting Filer’s testimony that this
information was not conveyed to him by Cannon. It is undisputed that FSTI did not directly inform
DPC of the HASA sale at that time.
22 Trussell Depo. at 200; see also Def. Termination MSJ Exh. 16, Staci Barton Deposition (Staci
Depo.), at 200–201; Cannon Depo. at 113.
23 Def. Termination MSJ Exh. 17; Cannon Depo. at 113; Trussell Depo. at 202–04.
24 Trussell Depo. at 200-01; Stormey Depo. at 151; 4.20.26 TI Trans., at 200–02.
25 Second Am. Counterclaims at ¶ 43; 4.20.26 TI Trans. at 235.

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¶10 This Lawsuit. On March 11, 2024—about a month after the HASA sale
and days before FSTI stopped handling DPC’s Bulk Contract orders—FSTI initiated
this lawsuit seeking a declaratory judgment that (among other things) its sale of the
Greenville facility to HASA was not a breach of the Bulk Contract because it “sold
the plant in good faith and thus no longer has any output at the Greenville Facility
to sell under the [Bulk Contract].”26 FSTI alleged that the Bulk Contract was “an
output contract under Texas Business & Commerce Code section 2.306(a),” such
that FSTI was not obligated to sell any bleach to DPC if it did not actually produce
any bleach, so long as FSTI acted in good faith.27
¶11 In April 2024, DPC answered and brought counterclaims alleging that
(among other things) FSTI repudiated and breached the Bulk Contract by selling the
Greenville facility to HASA while excluding the Bulk Contract from the sale.28
According to DPC, the Bulk Contract pricing was so favorable to DPC that FSTI was
able to inflate the purchase price of the Greenville facility by millions of dollars by
excluding the Bulk Contract from the HASA sale—even though FSTI knew it would
26 Def. MSJ Exh. G, Plaintiff’s Original Petition (Orig. Pet.) at ¶ 36; First Am. Pet. at ¶ 41. Suit was
originally filed in the 98th District Court; the parties later agreed to transfer the action to this Court
on March 25, 2026.
27 Orig. Pet. at ¶¶ 34–37; First Am. Pet. at ¶ 39.
28 Second Am. Counterclaims at ¶¶ 61–70.

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be unable to perform under the Bulk Contract once it sold the facility.29 DPC alleged
that FSTI’s conduct was not in good faith or in accordance with commercial
standards of fair dealing.30 In May 2024, FSTI amended its pleadings to add a claim
that DPC breached the Bulk Contract by failing to purchase all of the Greenville
facility’s bulk-bleach output.31 In December 2024, FSTI further amended to allege
that DPC “breached and/or was in default under [the Bulk Contract], permitting
FSTI to cancel or terminate the agreement pursuant to its terms.”32
¶12 The parties have now filed competing motions for summary judgment
on their claims for breach of the Bulk Contract, and DPC also seeks summary
judgment on FSTI’s right-to-terminate defense. At issue here is DPC’s claim against
FSTI for breach of the Bulk Contract and FSTI’s termination defense to that claim.
Legal Standards
¶13 FSTI’s MSJ and Defendants’ Termination MSJ are motions for
traditional summary judgment on which the movant bears the burden of showing
that “there is no genuine issue as to any material fact and the movant is entitled to
29 Defendants’ First Amended Answer and Counterclaims (First Am. Counterclaims) at ¶¶ 17, 44,
69; Second Am. Counterclaims at ¶¶ 17, 44, 69.
30 First Am. Counterclaims at ¶ 69; Second Am. Counterclaims at ¶ 69.
31 First. Am. Pet. at ¶¶ 21–25, 43–48.
32 Def. Termination MSJ, Exh. 2, Plaintiff/Counter-Defendant FSTI’s First Amended Answer and
Affirmative Defenses to Defendants/Counter-Plaintiffs’ Counterclaims (First Am. Answer to
Counterclaims), at 2.

10
judgment as a matter of law on the issues expressly set out in the motion.”33 If the
movant satisfies this burden, the burden shifts to the nonmovant to present evidence
that creates a genuine issue of material fact in order to defeat the motion.34
¶14 The motions require the Court to construe the Bulk Contract. The
meaning of an unambiguous contract is a question of law for the courts.35 The Court
has laid out Texas’s general rules of contract construction in its prior opinions.36 In
short, the Court holds parties to what they said in the contract and interprets what
the contract says to mean what an ordinary reader would think it means under the
circumstances, based on the contract’s plain language.37 What an ordinary reader
understands words to mean can be influenced by the context in which the words are
written, so courts read the contract as a whole and consider things like the contract’s
structure, the text surrounding the disputed language, the nature of the contract, the
purpose reflected in the contract, word usage, grammar, and punctuation.38
33 TEX. R. CIV. P. 166a(h)(2).
34 E.g., Mosaic Baybrook One, L.P. v. Simien, 674 S.W.3d 234, 252 (Tex. 2023); Amedisys, Inc. v.
Kingwood Home Health Care, LLC, 437 S.W.3d 507, 511 (Tex. 2014); Tex. Dep’t of Pub. Safety v.
Tex. Tribune, 731 S.W.3d 772, 783 (Tex. App. [15th Dist.] 2026); Walker v. Harris, 924 S.W.2d
375, 377 (Tex. 1996) (citing “Moore” Burger, Inc. v. Phillips Petroleum Co., 492 S.W.2d 934, 936
(Tex. 1972)).
35 URI, Inc. v. Kleberg Cnty., 543 S.W.3d 755, 763 (Tex. 2018). The parties did not argue ambiguity
here.
36 See, e.g., Marathon Oil Co. v. Mercuria Energy Am., LLC, 2025 Tex. Bus. 36, ¶ 6, 722 S.W.3d at
729-730 (3rd Div.).
37 Id. And, of course, if the contract defines terms or otherwise shows that its words are intended to
mean something different than usual, a reasonable reader would accept that. Id. at ¶ 8, 731.
38 Id. at ¶ 6, 729–730 (citing authority addressing each such consideration).

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The Parties’ Arguments
¶15 Section 3 arguments. According to FSTI, Section 3 of the Bulk Contract
obligated DPC to provide shipping instructions to FSTI on the twentieth day of each
month.39 DPC undisputedly never did so. FSTI asserts that this monthly breach
throughout the term of the Bulk Contract gave FSTI a right to cancel the contract
under Section 19, which FSTI did when it sold the Greenville facility to HASA.40
FSTI expressly relies only on Section 19 of the Bulk Contract and not the affirmative
defense of “prior material breach,”41 asserting that it could cancel under Section 19
without telling DPC the contract was cancelled and regardless of whether DPC’s
breaches were material or caused any damages to FSTI.
¶16 DPC responds that Section 3 required shipping instructions only if
FSTI shipped the bulk bleach to DPC, which was not the case; instead, DPC was the
shipper, required to pick up the bulk bleach at the Greenville facility. DPC argues
that FSTI’s theory that DPC was required to provide it shipping instructions was
manufactured for this litigation; during the years in which the parties performed
under the contract, no one ever expected DPC to provide monthly shipping
39 FSTI also asserts that DPC breached the Bulk Contract by failing to satisfy its purchase
obligations. The Court has separately granted summary judgment in favor of DPC on that issue,
leaving only the shipping-instruction breach at issue. See FSTI, Inc. v. PVS Minibulk, Inc., 2026
Tex. Bus. 69, 2026 WL 2949440, (3rd Div.). Accordingly, the Court addresses only the remaining
issue here.
40 FSTI MSJ at 5.
41 Id. at 29.

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instructions or asserted that it should do so; and it would make no sense for DPC to
provide shipping instructions to FSTI when DPC was the shipper, not FSTI. Under
the Bulk Contract’s express terms, DPC was required to and did pick up the bulk
bleach at FSTI’s Greenville facility.
¶17 DPC recognizes that there were a few occasions over the years when
FSTI transported the bulk bleach, but DPC says FSTI did so at DPC’s behest and
cost, under a separate carrier agreement between them.
¶18 FSTI interprets Section 3 to require the shipping instructions to specify
the quantity of bulk bleach to be shipped in the next month and posits that, under
that interpretation, the instructions would still have a purpose even though DPC
was the shipper: it would notify FSTI how much bulk bleach to produce in the
following month. DPC disagrees that Section 3 required DPC to tell FSTI the
quantity of bleach to produce, noting that this is an output contract, such that the
seller, FSTI, is the party with the right to determine how much bleach is produced
and sold under the contract, not DPC. FSTI agrees that the Bulk Contract is an
output contract and that FSTI should have the right to control the quantity under it
but argues that the factual circumstances impinged on FSTI’s ability to do so.
¶19 Cancellation arguments. DPC argues that the summary judgment
evidence conclusively establishes that FSTI did not cancel the Bulk Contract prior
to its repudiation and breach of the contract. According to DPC, FSTI repudiated the

13
Bulk Contract on February 15, 2024, the date of the HASA agreement, whereas the
earliest date on which FSTI alleges it cancelled the Bulk Contract is February 16.
DPC also argues that, although FSTI claims it breached the Bulk Contract every
single month since its inception, FSTI performed under the contract for years and
even continued performing for a month after the HASA sale by continuing to receive,
fulfill, and accept payment for DPC’s bleach orders for the Greenville facility at the
contract price.
¶20 DPC also points out that, at least until several months into this lawsuit,
FSTI consistently took the position that the Bulk Contract was in effect. In the
HASA sale agreement, FSTI represented that the Bulk Contract was “in effect as of
the date” of the HASA sale agreement and FSTI was bound by it.42 And when it
initiated this lawsuit, FSTI did not allege that it had cancelled the Bulk Contract;
rather, FSTI sought a declaration that FSTI did not breach the Bulk Contract by
selling the Greenville facility because “FSTI sold the plant in good faith and thus no
longer has any output at the Greenville Facility to sell under the [Bulk Contract].”43
DPC also asserts that even after FSTI stopped handling its bleach purchases under
the Bulk Contract, DPC did not know that the Bulk Contract had not been assigned
42 HASA Agmt. at § 3.19(a); Defendants’ Termination MSJ Exh. 12, Sellers Disclosure Schedules,
3.19(a).
43 Orig. Pet. at ¶¶ 33–37.

14
to HASA with the Greenville facility’s other contracts. DPC points out that, in
March 2024, when FSTI and HASA informed DPC that HASA would take over
orders from the Greenville facility, DPC was told that HASA and FSTI would “be
working together to ensure a seamless transition,”44 and HASA continued to honor
the Bulk Contract price for several months before informing DPC that the Bulk
Contract had been excluded from the sale of the Greenville facility.
¶21 DPC further argues that, under Texas law, when one party’s breach of
contract gives the other party the right to terminate the contract, the nonbreaching
party has an election to make: it may terminate the contract for breach or it may
continue performing and accepting benefits under the contract. If the party chooses
the former, even when prior notice is not required, the party must still take some
action to manifest its election to terminate the contract. If the party chooses the
latter, it is still entitled to seek damages for the breach, but it may not lay behind the
log, accept the benefits of the contract for years, and then breach the contract at will
and evade liability by claiming termination after the fact. DPC asserts that Section
19’s authorization of cancellation “without demand or notice of any kind”45 relieves
FSTI of the duty it would otherwise have to provide reasonable advance notice of
cancellation but does not mean that FSTI can simply decide afterward that the Bulk
44 Def. Term. MSJ Exhs. 17 & 34.
45 Bulk Contract at § 19.

15
Contract was cancelled without ever saying or doing anything to cancel the contract
or that it could both cancel the contract and continue enforcing it.
¶22 FSTI does not argue that it ever told DPC that the Bulk Contract was
cancelled outside of this lawsuit. Instead, FSTI argues that because Section 3
allowed it to cancel the contract without notice, it was not required to inform DPC
the contract was cancelled. According to FSTI, it cancelled the contract by no longer
selling bleach to DPC from the Greenville facility after the HASA sale. FSTI
concedes that it continued to fulfill DPC’s orders and accept DPC’s contract-price
payments for bulk bleach from the Greenville facility after the HASA sale but argues
that it did so on behalf of HASA, the facility’s new owner. FSTI also argues that its
phone call informing PVS of the HASA sale on February 16, 2024 constituted notice
of the sale to DPC, such that DPC should have known FSTI was acting on behalf of
HASA for all sales after that date. FSTI also points out that the Bulk Contract
requires prior written consent before assignment of the contract to a non-affiliate
and argues that, since DPC had not given such consent, DPC should have known
that the Bulk Contract was excluded from the HASA sale.
¶23 FSTI further argues that DPC’s election of remedies argument is
essentially a waiver argument and is therefore barred by the Bulk Contract’s non-
waiver provision.46 FSTI also asserts that DPC breached the contract anew every
46 Id. at § 17.

16
month when it failed to provide shipping instructions, such that FSTI’s right to
cancel the contract restarted each month. Finally, FSTI argues that the UCC rejects
the election-of-remedies doctrine, such that FSTI did not have to choose between
cancelling the Bulk Contract or continuing under it.
Analysis
¶24 The motions before the Court turn on the same two issues: (1) did DPC
breach Section 3 of the Bulk Contract by failing to send FSTI monthly shipping
instructions, and if so, (2) did FSTI properly cancel the Bulk Contract under Section
19 before its own alleged breach? If the answer to either question is “no,” the
Plaintiff’s MSJ fails and Defendants’ Termination MSJ succeeds. The Court
answers “no” to the first question and thus resolves both motions in favor of DPC
without reaching the second question.
¶25 The Court agrees with DPC that Section 3 require DPC to send FSTI
shipping instructions only if FSTI acted as the shipper under the Bulk Contract,
which did not occur. The first page of the Bulk Contract unambiguously identified
DPC the party responsible for all shipping under the contract.47 In fact, the
provisions regarding DPC’s shipping obligations make up approximately half of all
47 Id. at 1.

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the page-one, negotiated terms.48 Section 3 may well require the buyer to send
monthly shipping instructions in the context of the customer contracts from which
these terms and conditions were copied and pasted.49 But, within the context of the
Bulk Contract, the provision cannot reasonably be construed to require DPC to
provide FSTI shipping instructions on the twentieth of each month telling FSTI how
much bleach to ship to DPC and how to ship it.
¶26 First, the Bulk Contract repeatedly and unambiguously confirms that
DPC was the shipper under the contract, not FSTI. DPC could not instruct FSTI how
or where to ship the bleach—or to ship the bleach at all—because the Bulk Contract
placed responsibility for shipping on DPC, whom the contract required to pick up
the bleach at the Greenville facility.50 The Bulk Contract even specified how DPC
picked up the bleach: by bulk truckload using up to three trailers that could be
parked at the Greenville facility.51
¶27 FSTI argues that it “shipped” the bulk bleach by loading it onto DPC’s
trailers when DPC picked up the bleach at FSTI’s Greenville facility. FSTI points to
the negotiated term on page one of the Bulk Contract that states, “F.O.B. Point:
48 Id. (specifying the Greenville facility as the place where DPC would pick up the bleach, that
freight would be on DPC’s account, that the bleach would be picked up by bulk truckload, and how
many trailers DPC could park at the facility when picking up the bleach).
49 See Def. Resp. Exh. 18; Def. MSJ Exh. B; Filer Depo. at 69–70, 72.
50 Bulk Contract at 1.
51 Id.

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Seller’s facility in Greenville TX,” noting that “FOB refers to the point in the
shipping process at which the title, risk of delivery, and shipping costs of the goods
in question pass from the seller to the buyer.”52
¶28 The Court concludes the DPC was the shipper under the Bulk Contract,
not FSTI. The meaning of “F.O.B.” proffered by FSTI and the Bulk Contract’s
specification of “F.O.B. Point: Seller’s facility in Greenville TX” are both consistent
with DPC being the shipper under the Bulk Contract. As Black’s Law Dictionary
explains, “FOB” or “Free on Board” is “a mercantile-contract term allocating the
rights and duties of the buyer and the seller of goods with respect to delivery,
payment, and risk of loss, whereby the seller must clear the goods for export, and
the buyer must arrange for transportation.”53 Under this term, “[t]he seller’s
delivery is complete (and the risk of loss passes to the buyer) when the goods pass
into the transporter’s possession,” and “[t]he buyer is responsible for all costs of
carriage.”54
¶29 Consistently, the ordinary meaning of the verb “ship” and noun
“shipper” contemplates transportation from one place to another.55 A reasonable
52 FSTI Reply at 5 (quoting Majorpower Corp. v. Delta Elecs. (USA), Inc., No. 05-24-01426-CV,
2026 WL 1613270, at *1, n.1 (Tex. App.—Dallas June 4, 2026) (no pet.), and citing TEX. BUS. &
COM. CODE § 2.319).
53 FOB Shipping & Free on Board, BLACK’S LAW DICTIONARY (12th ed. 2024).
54 Id.
55 Ship (v.), BLACK’S LAW DICTIONARY (12th ed. 2024) (“To send (goods, documents, etc.) from one
place to another, esp. by delivery to a carrier for transportation.”); Shipper, BLACK’S LAW

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reader would understand the shipper to be DPC, the party responsible for
transporting the bleach from FSTI’s Greenville facility to a secondary destination,
not FSTI, the party who loaded its own product onto trailers parked at its own
facility, where it produced the bleach.
¶30 Thus, the Bulk Contract’s FOB provision and its provision that freight
would be on “Buyer’s account” placed responsibility for shipping on DPC rather
than FSTI.56 Even on the few instances in which DPC contracted with FSTI to use
FSTI’s trailers to transport the bleach, DPC’s use of the trailers was governed by a
separate carrier agreement between DPC and FSTI, and DPC remained the shipper
charged with responsibility for the risk and cost of shipping under the Bulk
Contract.57
¶31 This is consistent with how the parties understood the Bulk Contract,
as reflected in the summary-judgment record. Stoney Barton, who negotiated the
Bulk Contract on behalf of FSTI, testified that “the deal … was that DPC would
DICTIONARY (12th ed. 2024) (“[s]omeone who ships goods to another” or “[s]omeone who
contracts with a carrier for the transportation of cargo”); Ship (v.), THE COMPACT OXFORD ENGLISH
DICTIONARY (2nd Ed. 1989), (including “[t]o transport (goods) by rail or other means of
conveyance”); Shipper (v.), THE COMPACT OXFORD ENGLISH DICTIONARY (2nd Ed. 1989),
(including, “[o]ne who ships goods for transportation” and “[o]ne who transports goods by rail or
other means of conveyance”); Ship (v), Merriam-Webster.com Dictionary, Merriam-Webster,
www.merriam-webster.com (accessed Oct. 9, 2026) (including “to cause to be transported”);
Shipper, Merriam-Webster.com Dictionary, Merriam-Webster, www.merriam-webster.com
(accessed Oct. 9, 2026) (“one that sends goods by any form of conveyance”).
56 Bulk Contract at 1.
57 See id.; see also, e.g., Filer Depo. at 313–14.

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come and take the bleach at the plant.”58 Nicole Chambers of FSTI explained that
“CPU” in the order emails meant that the order was for “customer pick up,”
meaning that “the customer will pick up the order.”59 DPC never sent monthly
shipping instructions to FSTI under the Bulk Contract during the years that the
parties performed under the Bulk Contract, and the summary-judgment record
shows that FSTI never asked DPC to do so. Chambers testified that she did not recall
ever telling DPC they needed to send shipping instructions each month and “never
knew that was a thing.”60
¶32 Kurt Filer likewise testified that “neither party ever used the 20-day
shipping instructions clause in [the Bulk Contract].”61 He explained that there was
no reason for DPC to provide FSTI shipping instructions under the Bulk Contract
because DPC was responsible for picking up the bulk bleach at FSTI’s Greenville
facility.62 He also testified that it would not have been possible for DPC to provide
FSTI monthly shipping orders—“the business just doesn’t work that way.”63
58 Def. Resp. Exh. 3, Stoney Barton Deposition (Stoney Depo.), at 150.
59 Chambers Depo. at 120.
60 Id.
61 Id. at 102–04.
62 4.2026 TI Trans. at 313–14; see also DPC Corp. Rep. Depo. at 144 (Q. “…But on the shipping
instructions, DPC never provided shipping instructions on or before the 20th day of each month,
correct?” A. “I -- we never -- they never really did ship anything for us, so, no, we didn’t.”).
63 Filer Depo. at 72.

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Instead, “the business is conducted on a — more of a daily basis.”64 This makes
sense logistically, as bleach can only be stored for a few days before it degrades, and
FSTI’s storage tanks at the Greenville facility did not have the capacity to hold even
a week’s worth of production.65
¶33 Second, FSTI’s argument that Section 3’s purpose was to have DPC
communicate to FSTI on the twentieth of each month how much bleach it needed for
the next month is irreconcilable with the Bulk Contract as a whole. In some contexts,
“written shipping instructions for the quantity required during the next succeeding
month”66 might reasonably be interpreted to mean written shipping instructions for
whatever quantity would be required during the next month or to mean written
shipping instructions that also state the quantity required for the next month. But in
the context of the Bulk Contract, the latter interpretation is not reasonable.
¶34 As both parties agree, and as reflected in the Bulk Contract’s
“quantity” term, the Bulk Contract was an output contract. As a result, FSTI was
entitled to determine the quantity of bleach produced and sold under the contract,
not DPC.67 FSTI had direct control over the production facilities and determined
things like when production would be down for maintenance or repair work. It was
64 Id.
65 See generally, FSTI, Inc., 2026 Tex. Bus. 69, 2026 WL 2949440.
66 Bulk Contract at § 3.
67 See generally, FSTI, Inc., 2026 Tex. Bus. 69, 2026 WL 2949440.

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FSTI that knew and told DPC how much bleach it had produced, how much of that
was carved out for retail and minibulk sales, and when production was down or
reduced due to maintenance or repairs—all information necessary to determine how
much was available for pickup at any given time.68 FSTI did not communicate this
information to DPC a month in advance, nor did either of the parties expect it to do
so. Instead, these communications were on a day-to-day basis. Additionally, the
Bulk Contract capped DPC’s purchase obligation at the amount of its monthly sales
to customers, without any carveout for customer sales made after the twentieth day
of the preceding month.69
¶35 To the extent Section 3 of the Bulk Contract can be reconciled with the
shipping terms on page one, it must be construed to apply only if FSTI was or became
the shipper under the contract. To the extent Section 3 conflicts with the page-one
shipping terms, the deal-specific, negotiated provisions on page one control over the
boilerplate general terms and conditions that were cut and paste from earlier
contracts.70 In either event, the Bulk Contract cannot fairly be interpreted to require
68 See, e.g., Chamber’s Depo. at 109–11; Filer Depo. at 72–73; FSTI MSJ Exh. 16, David Byrd
Deposition (Byrd Depo.), at 72–74; see also, e.g., FSTI MSJ Exh. 2, Rene Whigham Deposition, at
156–57, 166–69 (explaining how plant maintenance interacts with production capabilities).
69 See Bulk Contract at § 4; see also Byrd Depo. at 73–75 (explaining that customer orders were
typically received two to three days in advance and almost never more than a week in advance).
70 See Houston Expl. Co. v. Wellington Underwriting Agencies, Ltd., 352 S.W.3d 462, 472 n. 50 (Tex.
2011) (“Even though the parties will often begin with a preprinted or standard form contract, they
will sometimes make additions to or changes in their printed contract, adopting it to their particular
transaction. Typically, such changes or additions will be handwritten but they may also be typed or
stamped. In accord with the general rule that all parts of a contract are to be given effect, the courts

23
DPC to provide FSTI with shipping instructions when it expressly requires DPC to
pick up the bleach at the facility where it is produced and places all shipping
responsibility on DPC.
Conclusion
¶36 Because Section 3 of the Bulk Contract did not require DPC to provide
FSTI monthly shipping instructions, FSTI’s termination defense fails as a matter of
law and FSTI is not entitled to summary judgment on DPC’s breach-of-contract
claim based on that defense. Because this determination is dispositive, the Court
need not reach DPC’s alternative ground for the same relief: whether FSTI failed to
properly cancel the Bulk Contract before its alleged breach and repudiation.
must seek to reconcile inconsistencies between the changed or added terms and the printed matter.
Where, however, the printed contract provisions irreconcilably conflict with the provisions added
by the parties, the added provisions will control.” (quoting 11 Richard A. Lord, WILLISTON ON
CONTRACTS § 32.13); see also, e.g., McCreary v. Bay Area Bank & Tr., 68 S.W.3d 727, 731–32 (Tex.
App.—Houston [14th Dist.] 2001, pet. dism’d) (“[T]o the extent that typewritten provisions of a
contract conflict with printed provisions, the typewritten provisions must be given effect over the
printed provisions. The rationale for the rule is that typewritten provisions are the immediate
language and terms selected by the parties themselves as setting forth their intentions, whereas the
printed form is intended for general use without reference to particular objects and aims.” (citations
omitted)); RESTATEMENT (SECOND) OF CONTRACTS § 203(d) (1981) (stating that, when interpreting
a contract, “[s]eparately negotiated or added terms are given greater weight than standardized
terms or other terms not separately negotiated”). Importantly, boilerplate provisions must not be
disregarded simply because they are boilerplate: “[B]oilerplate is boilerplate for a reason—because
it offers tried-and-true language to ensure a precise and predictable result.” Seila Law LLC v.
Consumer Fin. Prot. Bureau, 591 U.S. 197, 235 (2020). But like a more specific term can control
over a more general term without rendering the more general term meaningless, Wal-Mart Stores,
Inc. v. Xerox State & Loc. Sols., Inc., 663 S.W.3d 569, 587 (Tex. 2023) (quoting example from
Antonin Scalia & Bryan A. Garner, Reading Law: The Interpretation of Legal Texts 184 (2012)), a
contract-specific term can control over copied-and-pasted boilerplate term without rendering the
boilerplate term meaningless. There may be good reason for parties to use general terms and
conditions in their contracts with a general expectation of one result while still intending a different
result in the context of the specific terms of an individual contract.

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Date signed: October 12, 2026
____________________
Hon. Melissa Andrews
Judge of the Texas Business Court,
Third Division