Reference no: EM133640332

Question 

Ana, CEO of the City Market chain of restaurants, was outraged when a hilarious and scathing review of City Market's branded house wine on the Wine Observer website became a viral meme, and immediately launched a national search for a new supplier to provide City Market's house wines. City Market purchased a full-page ad in the trade publication Wine Biz, offering a three-year, exclusive supply contract to the first firm that could supply its house wine requirements and meet Ana's satisfaction in a taste test. The ad went into great detail about the required quality and character of the wine and provided data on City Market's last two years' house wine sales by volume. Fine Wines, a private label wine company, responded to the ad with a letter detailing their ability to match City Market's specifications at a price of $7.00 per bottle. CustomWines (a long-time competitor of Fine Wines) repeated the quality and quantity requirements from the ad in its letter, bragged about its wines' superior flavor, and promised to "beat Fine Wines' best offer by $2.00 per bottle for the same variety of wine." In its response to the ad, Grand Cru (another private label wine company) made no mention of quantity in its letter and simply promised to "meet or beat any competitor's price." At a taste test between the three companies' offerings at City Market's headquarters, Ana chose Grand Cru's wines, and presented Luz, Grand Cru's president, with a three- year exclusive contract to supply all of City Market's house wine at a price of $5.00 per bottle starting on the first of the month. Ana gave notice of cancellation to City Market's current house wine supplier and contracted with AdCo for an advertising campaign to promote the new house wines. Grand Cru changed the landing page for their website, boasting that their wines beat out Fine Wines and CustomWines in City Market's taste test. On the first of the month, Grand Cru failed to deliver any wine. of the month Grand Cru Ana called Grand Cru's director of sales and yelled, "You can't do this to me! I'm spending millions with AdCo to advertise your wines!" Grand Cru's director of sales hung up on Ana and is refusing to return Ana's calls. If City Market sues Grand Cru for breach of contract, who will prevail? Discuss.