Full opinion text
OPINION NANCY F. ATLAS, District Judge. TABLE OF CONTENTS I.Findings of Fact ........................................................588 A. Parties and Background.............................................588 B. Bidding and Sale Process............................................590 C. SHMB604 Compressors and Packaging into the M60 Model.............590 D. Features of the Parties’ Contracts....................................592 E. Procedural History..................................................594 II.Legal Analysis: Privity in Maritime Warranty Claims......................595 A. Maritime Jurisdiction ...............................................595 B. Sources of Maritime Law............................................595 1. Maritime Uniformity.............................................597 2. Local or State Interests..........................................598 3. East River Principles............................................599 4. Conclusion......................................................603 III.Merits of Warranty Claims...............................................603 A. Affirmations........................................................603 1. Express Warranties..............................................603 a. February 2004 Statements ....................................604 b. August 2004 Statements ......................................606 2. Implied Warranty of Fitness for a Particular Purpose..............607 3. Failure to Comply with Affirmation and Lack of Fitness for Particular Purpose ............................................607 B. Basis of the Bargain Reliance........................................608 C. Causation ..........................................................610 1. Base Day Rates..................................................610 2. Lost Capacity Damages..........................................617 3. Conclusion......................................................617 IV. Fraud by Omission......................................................618 A. Falsity and GE’s Knowledge of Falsity................................619 B. Duty to Disclose.....................................................620 C. Conclusion .........................................................621 Y. Conclusion..............................................................621 Plaintiff Berge Helene Ltd. (“Berge”) asserts in this action against Defendants GE Oil & Gas, Inc. and John Does 1-10 (“GE”) claims of breach of express warranties, breach of implied warranty of fitness for a particular purpose, and fraud by omission. The Court has subject matter jurisdiction pursuant to 28 U.S.C. §§ 1332 and 1333. This case was tried to the Court on seventeen separate days from May 21 through July 5, 2012. Each party presented numerous live witnesses, depositions, and extensive exhibits. Having carefully considered all the evidence introduced by the parties, all matters of record in this case, the arguments of counsel, and applicable authorities, the Court makes the following findings of fact and conclusions of law. The Court first summarize^ the facts essential to an understanding of: the parties, their relationships, and a chronology of events. Additional important facts are described where necessary in connection with analysis of the legal issues presented. 1. FINDINGS OF FACT A. Parties and Background Plaintiff Berge Helene Ltd. (“Berge”) is an experienced operator of floating production, storage, and offloading units (“FPSOs”). Berge Helene Ltd. is an entity organized and existing under the laws of Bermuda. Berge owns the BERGE HELENE, a FPSO. FPSOs generally are used for the production and storage of petroleum products. A key function of an FPSO is to process the components of a well stream, which generally comprise petroleum (“oil”), water, and gas. The oil is generally isolated and stored. The water is cleaned and returned to the sea or injected into the reservoir to maintain reservoir pressure. The gas is compressed by a gas compression module on the topside of the FPSO. There are five participants and four contracts relevant to the events in issue. All participants are highly sophisticated businesses. Woodside Mauritania Pty. Ltd. (“Wood-side”) sought bids for the lease and operation of an FPSO in 2008. Woodside hoped to be the first to develop the Chinguetti oil field off the coast of Mauritania, Africa. On May 29, 2004, Berge entered into a contract with Woodside to provide the requested FPSO. Because the Chinguetti field contained the first commercial discovery of oil in Mauritania, Woodside wanted to fast-track the development of the Chinguetti project in order to give Woodside a competitive edge in the region. The reserve estimate of the Chinguetti field was originally 123 million barrels of oil (“MMBO”), but the estimate was lowered to 68 MMBO in 2004 and was further decreased to 34 MMBO by the end of 2007. Woodside’s contract with Berge was to have the BERGE HELENE refitted to receive and produce processed crude oil at Chinguetti. The Woodside-Berge contract obligated Berge, inter alia, to operate and maintain the BERGE HELENE to “receive Production from the subsea system into the FPSO,” “process the Production by separating oil, gas and water,” “produce Processed Crude at a rate which [meets] the [specified] Volumes,” and carry out compression and reinjection of processed gas as required under the agreement. The Woodside-Berge contract required the FPSO BERGE HELENE, among other things, to compress up to 70 million standard cubic feet per day (“mmscfd”) of gas. The contract provided that Berge would be paid a base day rate (“BDR”) of $95,000 (this figure was later increased to $104,000). However, if 90% of required compression were not supplied on any given day (that is, at least 63 mmscfd), Wood-side would be entitled to reduce the day rates otherwise payable to Berge under the contract. Berge was the supplier to Woodside. Berge contracted with a Norwegian company, ABB Offshores Systems AS (referred to hereafter as “Aibel”) on June 24, 2004, to supply, install, and operate various types of topside modules aboard the BERGE HELENE, including the M60 gas compression module with three GE compressors (labeled A, B, and C). Berge selected Aibel over a competitor, Gas Services International, Ltd. (“GSI”), that proposed to supply compressors by Ariel Corporation (“Ariel”), a well-regarded and very experienced compressor manufacturer in the oil and gas industry. Berge and Aibel had had a business relationship since 2001 pursuant to an operating agreement and had worked together on various projects. At least in part, Berge selected Aibel to supply the M60 compression module because Woodside preferred to have all the BERGE HELENE topside modules provided by the same company, and Aibel was to supply other modules for the FPSO. The purchase price and installation cost of all the topside modules was $24.5 million. The price Aibel charged Berge for the M60 module with three GE compressors was $9,208,488. In the oil and gas industry, it is common practice for one company’s gas compressors to be “packaged” by third parties, called “packagers,” into a compression module. The packager generally constructs and may also be involved in the design of the machinery, piping, and other components that surround and are sold with the compressors in a compression module. In July 2004, Aibel contracted with Flotech Limited (“Flotech”), a New Zealand-based packager of compressors. Flotech was to package the M60 gas compression module for Aibel for the BERGE HELENE for approximately $2 million. For the M60 compression module, Flo-tech ordered from GE three SHMB604 model reciprocating compressors at a total cost of $593,679. As of 2004, Flotech and GE had been operating for over a year pursuant to a Packager Agreement (“GEFlotech Agreement”), under which Flotech committed to package compressors manufactured by GE. GE is a Delaware corporation, with a principal place of business in Houston, Texas. GE ultimately supplied model SHMB604 compressors for Flo-tech’s installation in the M60 compression module that Flotech delivered to Aibel for the BERGE HELENE. The SHMB604s were made with an Italian frame designed and made by Nuovo Pignone (“NP”), a GE subsidiary that principally designed and sold compressors in Europe. GE used cylinders and moving parts manufactured by Gemini, a Texas-based compressor manufacturer that GE earlier had acquired. B. Bidding and Sale Process As noted, in 2003, Woodside sought bids for the lease and operation of an FPSO to be deployed in the Chinguetti field. In 2003, Berge submitted a tender to Wood-side. In preparing its FPSO tender to Woodside, Berge sought a bid for the M60 module from two companies, one of which was Aibel. Aibel included GE F-606 compressors in its proposal. The F-606 model was larger and more expensive than the one Aibel and Berge ultimately chose. Because Aibel learned that Berge was seriously considering selecting the other bidder to supply the M60 compression module, Aibel sought a meeting with Berge to introduce Aibel’s proposed compression module team. On February 5, 2004, Berge representatives met with Aibel, Flotech, and GE at a sales meeting in Oslo, Norway. Two GE sales people attended. At that time, GE mentioned the idea of using a new model compressor, the SHMB604, for the FPSO BERGE HELENE. GE provided Berge representatives a compact disk (“CD”) titled “Software and Technical Data” with background information on GE compressors. The CD contained the GE EZ Size Program that packagers and customers could use to determine the size compressor they wanted. Shortly after the Oslo meeting, Berge received from Aibel a hard-copy packet of promotional materials. GE contributed to these materials, which included a three-page flyer called “GE Oil & Gas Compressor News” (“Flyer”) reflecting a maximum gas rod load of 72,000 pounds (“lbs.”) for the SHMB604 compressors. The materials also contained a GE “EZ Size Data Sheet” dated February 9, 2004 (“February 2004 Data Sheet”), which reflected a maximum rod load of 72,752 lbs. in tension and in compression for the SHMB604. C. SHMB604 Compressors and Packaging into the M60 Module The SHMB604 compressors were promoted, designed, and sold under American Petroleum Industry 11 (“API 11”) standards. API 11 standard for gas compressors states: The maximum operating rod load (gas or combined) shall not exceed the maximum allowable operating rod loading for the compressor or any rod load limitation specified by the purchaser at any specified operating condition. The packager shall quote gas rod load unless specified otherwise by the purchaser. If other than operating rod load calculations are specified, the purchaser will provide operating parameters to the packager for making these calculations. Gas-plus-inertia rod load refers to the maximum allowable rod loads set with reference to the net forces of gas and weight that all compressor components can tolerate. An “application limit” is the advertised limit used by an application engineer to size a compressor and includes a safety margin below the “hard limit.” A “hard limit” is the maximum allowable limit for continuous and safe operation and includes a safety margin below the “fatigue fail limit.” The SHMB604 compressor consists of an Italian frame and four American cylinders. The first two cylinders constitute the compressor’s “first stage,” the third cylinder is the “second stage,” and the fourth cylinder constitutes the “third stage.” The frame of the compressor is considered a stationary part. The moving parts (called the “running gear”) inside the compressor comprise a piston, piston rod, crosshead, crosshead pin, crankshaft, and connecting rod. In late 2003 or early 2004, Berge supplied the parties with a detailed Chinguetti field projection that included a “P50” estimate of the probable reserves of oil, gas, and water composition expected in the seabed fluids to be extracted. The experts’ estimate was that there would be approximately 75,000 barrels of oil per day (“BOPD”) and between 30 and 50 mmscfd gas. This estimate was the basis of the design of the GE compressors,. the M60 module and all other topside equipment on the BERGE HELENE. GE set the gas flow capacity of the SHMB604 compressors using its American EZ Size software. The EZ Size software also calculates the gas rod loads acting on a compressor’s frame, for each stage of compression. GE distributed its EZ Size software widely to its packagers, at trade shows, and to potential customers (including Berge, in the Technical Data CD). A user of this software is able to do extensive analysis and may print out a one-page summary data sheet that shows the maximum gas rod load application limits at the top of the sheet and the calculated operating gas rod loads at the bottom of the sheet. EZ Size software calculates, for each stage of compression, the gas-plus-inertia loads acting on the certain components of the compressors’ running gear, such as the piston rod and crosshead pin. The gas-plus-inertia load limits and the calculated gas-plus-inertia loads for each stage of compression are visible to the person operating the EZ Size program on the computer. GE set machine strength of the SHMB604 compressors (e.g., application and hard limits of piston rod load and crosshead pin load) using Italian Calc-26 software, although it appears that GE engineers also checked, or had their United States counterparts check, these conclusions in the EZ Size program. Calc-26 calculates gas rod loads acting on a compressor’s frame as well as the gas-plus-inertia loads on the running gear for each stage of compression. The Calc-26 printout is far more detailed than the EZ Size printouts. GE delivered the compressors to Flo-tech on or about October 7, 2004. The compressors were thereafter “packaged” into the M60 module by Flotech. The M60 compression module contained and was connected to numerous other components, such as pulsation bottles, tubing, coalescers/coolers, and separators. The M60 module was delivered to Aibel in Thailand. Aibel incorporated the M60 compression module into the rest of the FPSO topside equipment and delivered it to Berge on or about March 25, 2005, at a shipyard in Singapore. Testing of the compression module hy Aibel commenced on or about October 28, 2005. The BERGE HELENE was moved from Singapore to Africa and anchored at Chinguetti in November 2005. Additional testing and start-up of all the topside equipment proceeded thereafter. Difficulties with the M60 (and other) equipment occurred and became an issue in or about May 2006. Berge reported more than 180 “stops” of the M60 module between May and November 2006. Berge and Woodside decided to shut down the M60 module in early November 2006 because of concerns of accidents that could harm personnel and the FPSO. Final documentation accompanying GE’s compressors in the M60 module included a GE supplied August 13, 2004 Data Sheet (“August 2004 Data Sheet”). It is this data sheet on which Berge most heavily relies for its warranty claims. The August 13, 2004 Data Sheet states that each compressor could provide 23.39 mmscfd of compression, and thus the three units would provide a total of 70.17 mmscfd, if suction pressure (inlet pressure of the gas) was 148 pounds per square inch gauge (“psig”). This documentation was delivered to Berge well before the M60 module was tested or even shipped to the Chinguetti field, and before actual field operating conditions were known. D. Features of the Parties’ Contracts As noted, there are four contracts relevant to this dispute. First, there is the Woodside-Berge contract. The primary Woodside goal was oil production. The contract also provided a base day rate (“BDR”) to be paid by Woodside to Berge based in pertinent part on the amount of gas compressed by the FPSO. The BDR could be reduced if the gas injection system was operating at less than 90% of the required level. However, after production began, Woodside realized that extraction of oil from the Chinguetti field was very difficult, and the field never performed as expected. Gas and water content of the seabed fluids were much higher than expected. Woodside’s projected oil production during the first year was far lower than expected from the P50 which formed the basis of the entire FPSO topside design. The gas-oil ratio (“GOR”) of the produced fluid was much higher than expected and in 2006, was climbing at a very problematic rate. To maximize oil production, as it turned out, Woodside needed lower suction pressure for the M60 module. Woodside and Berge renegotiated the rates and penalties in light of the materially changed field circumstances. Woodside and Berge allocated and controlled risk through mutual indemnity provisions and exclusions of liability for all consequential damages, and excluded recovery for lost profits or incidental and consequential damages. Berge agreed with Woodside that Berge would be the “agent” of all its subcontractors (any company “engaged by [Berge] to execute a portion of the Work”). Prior to the start of operations, Berge did not disclose to GE the terms of the Woodside-Berge contract. The Berge-Aibel Operations Contract was significant in that Aibel agreed to be “responsible for its subcontractors and all parts of the Work performed by such subcontractors from time to time.” Berge recognized in this contract that where actual field or reservoir conditions differ from client-supplied appraisals, there could be costly “consequences to the operations and maintenance caused by the actual field’s environmental, soil or reservoir characteristics,” and Berge agreed to “meet any additional cost incurred by Contractor as a result of errors, omissions or inaccuracies in this [reservoir] information.” Aibel obligated itself to fully furnish and equip the FPSO for operational requirements consistent with the Basis of Design in the Woodside-Berge agreement, including the compression module. The parties agreed that Norwegian law would apply. They also agreed that neither would be liable for any special, consequential, incidental, indirect, or exemplary loss or damages. Berge excluded damages for consequential damages relating to the gas compression module. Aibel’s customer was Berge. Aibel entered into a contract with Flo-tech in July 2004, wherein Flotech agreed to provide the engineering, fabrication, and supply (ie., the “packaging”) of the M60 gas compression module on the BERGE HELENE. Flotech agreed it had “overall responsibility for the proper technical completion of the equipment and services” as defined in the contract. Flotech agreed to remedy deficiencies in the “Goods” being supplied. These parties’ contract barred recovery of lost profits or consequential damages by either party and limited liability to the contract price. Aibel was Flotech’s customer. Flotech submitted a purchase order to GE on June 3, 2004 for the SHMB604 compressors, which were designed in light of the “Basis of Design” in the Woodside contract with Berge. Berge and Aibel changed the design conditions during Summer 2004, and Flotech submitted different purchase orders to GE to reflect these changed conditions. GE presented Flo-tech with a final Order Acknowledgment in August 2004. GE was paid less than $200,000 per compressor. These parties agreed (paragraph 5) that: [Flotech] is not the agent of [GE] and has no right or authority to assume or create any obligation of any kind, express or implied, on behalf of [GE], or to bind [GE] in any respect whatsoever. The relationship of [Flotech] to [GE] is that of independent contractor, and in no event shall [Flotech] and [GE] be considered to be joint venturers, partners or to have any other similar legal relationship for any purposes whatsoever. This contract excluded liability for consequential damages and set a total liability limit of the purchase price of the compressors, $593,679. Under this contract, Flo-tech was required to pass GE’s limits of liability and very limited warranty to Flo-tech’s customers. Flotech was GE’s customer, and GE communicated during the design period and for some time thereafter solely with Flotech, its contract partner. E. Procedural History On October 1, 2008, Berge sued GE and John Does 1-10 in this Court alleging breach of express warranties and breach of implied warranty of fitness for a particular purpose. After the parties engaged in extensive worldwide discovery, GE moved for summary judgment. The Court denied this relief in large part on November 16, 2011. See Memorandum and Order, 830 F.Supp.2d 235 (S.D.Tex.2011) [Doe. # 230] (denying Defendant’s Motion for Summary Judgment on Plaintiffs Implied Warranty Claims [Doc. # 179], granting in small part and denying in part Defendants’ Motion for Summary Judgment on Plaintiffs Express Warranty Claims [Doc. # 180], and denying Defendants’ Motion for Summary Judgment on Plaintiffs Damages Claims [Doc. # 181]). At Docket Call on January 18, 2012, the Court set trial to start February 13, 2012. On February 2, 2012, the Court held a discovery hearing on sixty-one documents, consisting of 2,500 pages, belatedly produced by GE in January 2012 — more than seven months after the close of discovery and less than one month before the original trial date in February 2012. Hearing Minutes & Order [Doc. # 280]. At the hearing, the Court granted Berge leave to amend to add a fraud claim. See id. On February 9, 2012, Berge filed a First Amended Complaint [Doc. # 282], adding a fraud claim related to piston rod loads. Berge seeks $17,710,486 in damages for lost BDR and $23,649,185 in damages for the purchase, transportation, and installation of a supplemental compressor. Berge also seeks punitive or exemplary damages for GE’s alleged fraudulent conduct as well as attorneys’ fees for GE’s conduct in litigation. On May 15, 2012, GE filed a Motion to Strike [Doc. # 305], seeking to strike references by Berge in its pretrial filings [Docs. #291, 292, 293] of a fraud claim related to crosshead pin loads. The Court granted GE’s Motion to Strike [Doc. # 305] because the crosshead pin issue had not been pleaded in Berge’s First Amended Complaint. II. LEGAL ANALYSIS: PRIVITY IN MARITIME WARRANTY CLAIMS A. Maritime Jurisdiction To ascertain the extent of admiralty jurisdiction over contracts and claims arising from contract, courts look first to the nature or subject matter of the contract. Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 23-24, 125 S.Ct. 385, 160 L.Ed.2d 283 (2004) (citations omitted). Contracts for repair, alteration, conversion, or reconstruction of a vessel which, previous to such work, was actively engaged in maritime commerce or navigation generally are considered maritime contracts. N. Pac. S.S. Co. v. Hall Bros. Marine Ry. & Shipbuilding Co., 249 U.S. 119, 128, 39 S.Ct. 221, 63 L.Ed. 510 (1918); One Beacon Ins. Co. v. Crowley Marine Servs., Inc., 648 F.3d 258, 262 (5th Cir.2011). Disputes over warranties arising from such contracts also fall within maritime jurisdiction. 1 Thomas J. Shoenbaum, Admiralty & Mar. Law § 5-8 (5th ed.) (“Shoenbaum”). The parties agree that this Court has maritime jurisdiction over the breach of warranty claims. See First Amended Complaint [Doc. #282-2], at 3; Revised Joint Pretrial Order [Doc. # 290], at 4. B. Sources of Maritime Law “Absent a relevant statute, the general maritime law, as developed by the judiciary, applies. Drawn from state and federal sources, the general maritime law is an amalgam of traditional common-law rules, modifications of those rules, and newly created rules.” E. River S.S. Corp. v. Transamerica Delaval, Inc., 476 U.S. 858, 864-65, 106 S.Ct. 2295, 90 L.Ed.2d 865 (1986) (citations omitted); One Beacon Ins., 648 F.3d at 262 (5th Cir.2011). The key policy underlying federal maritime jurisdiction is need for uniformity in the development of maritime law. See S. Pac. Co. v. Jensen, 244 U.S. 205, 216, 37 S.Ct. 524, 61 L.Ed. 1086 (1917), superseded by statute on other grounds, Longshoremen’s & Harbor Workers’ Compensation Act of 1927, 44 Stat. 1424; Green v. Vermilion Corp., 144 F.3d 332, 340 (5th Cir.1998) (“[T]he constant theme of these Supreme Court opinions is that the uniformity of admiralty law must be preserved and that state law may be applied only where it works no ‘material prejudice to the essential features of the general maritime law.’ That uniformity is not to be sacrificed to accommodate state law is a fundamental premise of admiralty jurisdiction.” (citations omitted)); Coats v. Penrod Drilling Corp., 61 F.3d 1113, 1137 (5th Cir.1995). “[T]he need for predictability in the commercial maritime arena is arguably greater than in other areas of law and commerce. This is true because there are already numerous and inherently unpredictable factors stemming from the perils of the sea and the continual — and frequently fortuitous — interaction with enterprises of other nations. It is axiomatic that when the rules of law are clear, parties may contract within or around their boundaries, and the commercial system is facilitated in many ways, including reduced litigation, more favorable insurance coverage, and overall ease of application.” Coats, 61 F.3d at 1137; see also 1 Shoenbaum § 4-1. Generally, there are four sources of admiralty law: (1) the general maritime law, (2) federal statutes, (3) international agreements, and (4) state law (insofar as appropriate in the admiralty context). The first category, general maritime law, is a body of concepts, principles, and rules that have been adopted and expounded over time by the federal courts. Because general maritime law is not a complete or all-inclusive system, federal courts may fashion a rule for decision when situations arise that are not directly governed by legislation or admiralty precedent. Courts create admiralty rules only when there is a substantial need to fashion new rules. Koninklyke Nederlandsche Stoomboot Maalschappy, N.V. v. Strachan Shipping Co., 301 F.2d 741, 744 (5th Cir.1962); 1 Shoenbaum § 4-2. Thus, in the absence of a federal statute, a judicially-fashioned federal rule, or a need for uniformity, courts may apply relevant state law. See Wilburn Boat Co. v. Fireman’s Fund Ins. Co., 348 U.S. 310, 314-16, 75 S.Ct. 368, 99 L.Ed. 337 (1955); Ham Marine, Inc. v. Dresser Indus., Inc., 72 F.3d 454, 459 (5th Cir.1995); Koninklyke, 301 F.2d at 743. For example, federal courts may look to, adopt, and apply as the federal admiralty rule state statutory law and precepts of the common law. See generally Palestina v. Fernandez, 701 F.2d 438, 439 (5th Cir.1983) (holding that in “a garden variety state tort claim ... where there is no uniform federal rule, ‘even though admiralty suits are governed by federal substantive and procedural law, courts applying maritime law may adopt state law by express or implied reference or by virtue of the interstitial nature of federal law.’ ” (citations omitted)). In this process, federal courts prefer to borrow the general common law rather than the law of any particular state because this promotes uniformity in the general maritime law. Marastro Compania Naviera, S.A. v. Canadian Mar. Carriers, Ltd., 959 F.2d 49, 53 (5th Cir.1992); see, e.g., Har-Win, Inc. v. Consol. Grain & Barge Co., 794 F.2d 985, 987 (5th Cir.1986) (applying general common law); Atl. & Gulf Stevedores v. Revelle Shipping Agency, Inc., 750 F.2d 457, 459 (5th Cir.1985) (same). Federal courts may also apply a particular state’s law as the default rule to a case within admiralty jurisdiction where there is no applicable admiralty rule or principle, where the uniformity principle is not crucial, and where local or state interests predominate. Fossick v. United Fruit Co., 365 U.S. 731, 741, 81 S.Ct. 886, 6 L.Ed.2d 56 (1961); Wilburn, 348 U.S. at 314-16, 75 S.Ct. 368. Accordingly, a particular state’s law should not be applied as admiralty law where the need for uniformity is great, where state interests do not dominate, or where there is an applicable admiralty rule or principle. See Fossick, 365 U.S. at 741-42, 81 S.Ct. 886; Wilburn, 348 U.S. at 314-16, 75 S.Ct. 368; Koninklyke, 301 F.2d at 743. In the summary judgment Memorandum and Order issued November 16, 2011, 830 F.Supp.2d 235 (S.D.Tex.2011) [Doc. # 230] (“November 2011 Memorandum”), this Court held that the Supreme Court’s decision in East River Steamship Corp. v. Transamerica Delaval did not establish maritime rules governing key issues in this case, such as privity, reliance, disclaimers, and consequential damages. The Court, believing this case had substantial connections to Texas, applied several Texas legal doctrines as maritime rules to evaluate Berge’s claims for breach of express warranty and breach of implied warranty of fitness of particular purpose. However, having presided over the trial and reviewed the full factual record presented by the parties as well as the governing legal authorities, the Court’s view has changed. The Court now concludes that its pretrial legal conclusion is not legally correct, at least as applied to the facts proven at trial. The Court accordingly withdraws its earlier holding that the loose privity requirement of Texas state warranty law applies to this dispute. As explained in more detail hereafter, the facts adduced at trial reveal a great need for uniform legal rules in the circumstances presented. Applying Texas law — or even the general Uniform Commercial Code (“U.C.C.”) — on the scope of privity would hinder development of consistent and predictable maritime rules. In addition, the State of Texas has only a very limited interest in the outcome of this case, and Texas’s interest is insufficient to justify the application of Texas law on express and implied warranties. Moreover, the maritime principles articulated in East River counsel against recognition of Plaintiff Berge’s putative warranty claims. Thus, the Court concludes that Berge’s breach of warranty claims against GE are barred for lack of contractual privity. The Court explains its reasoning below. 1. Maritime Uniformity There is no explicit maritime rule, federal statute, or federal common law on privity in warranty claims in maritime actions. Thus, the Court must consider whether or not a state common law or the law of a single state should apply. When federal courts apply state law in admiralty, courts prefer to borrow the general common law rather than the law of any particular state because this promotes uniformity in the general maritime law. Marastro Compania, 959 F.2d at 53; see, e.g., Har-Win, Inc., 794 F.2d at 987; Revelle Shipping, 750 F.2d at 459. Accordingly, courts look to the U.C.C. as a reliable source for federal admiralty law. See N. Pac., 249 U.S. at 127, 39 S.Ct. 221; Clem Perrin Marine Towing, Inc. v. Panama Canal Co., 730 F.2d 186, 189 (5th Cir.1984); see also Princess Cruises, Inc. v. Gen. Elec. Co., 143 F.3d 828, 832 (4th Cir.1998); Southworth Machinery Co. v. F/V Corey Pride, 994 F.2d 37, 41 n. 3 (1st Cir.1993) (citations omitted). Here, the Court concludes that applying general U.C.C. rules or the law of Texas to decide privity requirements in maritime warranty actions would not advance the maritime goal of uniformity. The U.C.C. does not supply a clear rule on the privity requirement in warranty actions. Instead, U.C.C. § 2-318 sets forth two statutory alternatives which relax the privity requirement for natural persons bringing breach of express or implied warranties claims for personal injuries, plus another less restrictive alternative. Even more significantly, Comment 3 to U.C.C. § 2-318 explains that “the section ... is neutral and is not intended to enlarge or restrict the developing case law on whether the seller’s warranties, given to his buyer who resells, extend to other persons in the distributive chain.” Id. (addressing “vertical privity”). Section 2-318 of the U.C.C. accordingly does not address the situation at bar where the plaintiff is in vertical privity with the defendant. See Keith v. Stoelting, Inc., 915 F.2d 996, 999 (5th Cir.1990). Accordingly, the U.C.C. supplies no clear rule on whether a buyer in vertical privity may recover for economic loss. Furthermore, states have adopted widely varying requirements on privity for warranty claims. Texas has not adopted a legislative standard at all, choosing instead to delegate the matter to its state courts. Furthermore, for vertical privity, state courts, including Texas, have introduced more uncertainty in the privity rule, looking to factors such as whether direct communications occurred between the defendant and buyer; whether the defendant was a manufacturer or component manufacturer; whether the parties were consumers or commercial entities; and whether the injury was physical or solely economic. Berge seeks economic damages as the ultimate user which was in the distributive chain, but was not the buyer of GE’s compressors or even the M60 compression module in which the compressors were packaged. Because the U.C.C. does not supply a clear rule on privity in these circumstances and because state law on privity has not developed uniformly, applying Texas or general state warranty law to the dispute at bar to eliminate the privity requirement would create significant inconsistency and unpredictability in maritime law. 2. Local or State Interests In its November 2011 Memorandum, the Court concluded that Texas is the state within the United States with the greatest connections to the transactions, events in issue, and the parties, and thus concluded that application of Texas warranty law was appropriate. The trial record establishes clearly, however, only several relevant GE employees lived in Texas. All other participants were from foreign countries, i.e., New Zealand, Norway, and Italy. It is clear now that while some sizing analysis for the compressors occurred in Texas, the compressors were manufactured in Wisconsin. Virtually all other key events occurred in foreign countries, including Norway, Italy, Thailand, Singapore, and off the coast of Mauritania. Further, the compressors in dispute not tested in Texas. Nor is Texas — or the United States — where the compressors were packaged into the complex M60M60 compression module. Indeed, the module was assembled by others in Thailand, tested by others in Singapore, and delivered by others to the BERGE HELENE in Africa. Texas also is not where the compressors or module allegedly malfunctioned and caused Berge economic injury. The evidence thus demonstrates that Texas and it citizens have only the most remote interest in the warranty claims in this case. Texas warranty law, especially as interpreted by Plaintiff, is oriented toward protecting consumers. See Nobility Homes of Tex., Inc. v. Shivers, 557 S.W.2d 77, 81 (Tex.1977) (“The fact that a product injures a consumer economically and not physically should not bar the consumer’s recovery. Economic loss can certainly be as disastrous as physical injury.”). In contrast, maritime law is designed to protect freedom of contract and allocation of risk among commercial parties. See Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 25, 125 S.Ct. 385, 160 L.Ed.2d 283 (2004) (“We have reiterated that the fundamental interest giving rise to maritime jurisdiction is the protection of maritime commerce.” (internal quotation marks and citation omitted)). Here, the dispute is not between a manufacturer and consumer over a defective product that caused physical injury in Texas or to a Texas resident. Rather, the claims in the suit involve two sophisticated parties concerning commercial equipment purchased by a New Zealand company for sale through a Norwegian entity to another Norwegian entity for use on a vessel (an FPSO) located off the coast of Africa. There were no physical injuries. In these circumstances, Texas’s interest is insufficient to justify application of its state warranty law as federal maritime law. 3. East River Principles Although East River was not a breach of warranty case, it established a core maritime law principle: Manufacturers are not required to protect, independent of any contractual obligation, a commercial product from injuring itself. See 476 U.S. at 866-75, 106 S.Ct. 2295. Applying East River’s core principle, the Court concludes that Berge’s warranty claims against GE for economic damages are not legally viable under maritime law because Berge lacks contractual privity with manufacturer GE. In East River, the Supreme Court decided two issues. First, it recognized that the law of products liability, including negligence and strict liability, is a part of the general maritime law. Id. at 865, 106 S.Ct. 2295. Second, it limited the scope of products liability in the maritime tort context by holding that “a manufacturer in a commercial relationship has no duty under either a negligence or strict products-liability theory to prevent a product from injuring itself.” Id. In reaching the latter conclusion, the Court reviewed the purposes of product liability and its relationship to contract law, noting that “[products liability grew out of a public policy judgment that people need more protection from dangerous products than is afforded by the law of warranty.” Id. at 866, 106 S.Ct. 2295 (citation omitted). Where a product injures only itself, “the tort concern with safety is reduced,” and the availability of insurance and contractual remedies weigh against holding a manufacturer liable in tort. Id. at 871-72, 106 S.Ct. 2295. The Court thus concluded that damage to a product itself “is the essence of a warranty action, through which a contracting party can seek to recoup the benefit of its bargain.” Id. at 871-73, 106 S.Ct. 2295. In addition to the nature of the injury, the Court identified other reasons why contract doctrines, indeed, warranty law as a subset of contract, is the proper route to pursue defective product claims for economic loss. First, warranty law is “well suited to commercial controversies ... because the parties may set the terms of their own agreements”: “The manufacturer can restrict its liability, within limits, by disclaiming warranties or limiting remedies” and a plaintiff buyer can obtain “the full benefit of its bargain” by seeking expectation damages as well as repair costs and lost profits. Id. at 872-73, 106 S.Ct. 2295. Second, warranty actions have a “built-in limitation on liability.” Id. at 874, 106 S.Ct. 2295. In a contract claim, the limitation derives from “the agreement of the parties and the requirement that consequential damages, such as lost profits, be a foreseeable result of the breach.” Id. (citation omitted). “In a warranty action where the loss is purely economic, the limitation derives from the requirements of foreseeability and of privity, which is still generally enforced for such claims in a commercial setting.” Id. (citing U.C.C. § 2-715; White & Summers, at 389, 396, 406-10). The Supreme Court thus expressed a core principle that warranties, and limitations on them, in the maritime context are creatures of commercial parties’ negotiations and agreement. In the instant action, Berge asserts claims for breaches of express warranty and implied warranty of fitness for a particular purpose seeking economic losses from GE arising from GE’s design and manufacture of reciprocating gas compressors. In name, Berge’s warranty claims for economic damages do not appear barred by East River because they are distinct from the strict products liability and negligence actions expressly barred by the Court. See id. at 876, 106 S.Ct. 2295. The evidence at trial demonstrates factually, however, that Berge’s warranty claims run afoul of East River’s core principle that maritime law does not provide a remedy, independent of a bargained-for obligation, when a commercial product injures itself. First, there is no contract between GE and Berge. Instead, there are three separate contracts regarding the gas compression equipment for the BERGE HELENE. Berge’s predecessor in interest, Bergesen d.y. ASA, entered into a contract with Aibel for the purchase and installation of the M60, a complex compression module. Aibel separately entered into a contract with Flotech to create and package that multi-component module. Finally, Flotech contracted with GE to purchase three SHMB604 compressors for the module. GE’s only contract was to sell its compressors to Flotech for installation into the modules Flotech sold to Aibel. The testimony of Berge, Aibel, Flotech, and GE witnesses establishes — and the documentary evidence reinforces — that with the one exception of a sales promotion meeting on February 5, 2004, attended by representatives of all four companies, Berge conferred with its contractual partner Aibel, and did not confer with GE, until well after the compression module was designed, assembled, tested, and installed. Significantly, GE’s communications during the design and packaging phases were with Flotech. All witnesses confirmed that, thereafter, the parties’ protocols and industry practice dictated that parties’ communications were only to be with immediate contract partners. In contrast, the warranty claims contemplated by the Supreme Court in East River were to arise from disputes between direct contracting parties or among parties who negotiated the terms of their transaction. See, e.g., 476 U.S. at 866, 106 S.Ct. 2295. In substance, the Supreme Court identified contractual warranty actions as the proper vehicle for pursuing defective product claims in which the only loss is economic loss, i.e., claims for damage to the goods purchased. The Court did not need to and did not address warranty claims against a party lacking privity with the ultimate purchaser, as in the case at bar. Second, unlike the circumstances envisioned in East River, GE lacked meaningful opportunity to negotiate the scope of any warranties to Berge or to limit remedies owed to Berge. The only pertinent direct communication between GE and Berge occurred at the February 2004 sales pitch meeting in Oslo. Trial testimony established that no participant believed that negotiations or definitive promises were made at that meeting. GE and Berge had no communications between February and August 2004, when negotiations for the compressors and compressor design concluded and the various agreements between parties in the contractual chain were signed. All parties in the contractual chain — Berge with Aibel, Aibel with Flotech, and Flotech with GE — limited their respective liabilities to their contractual partner. GE’s contract with Flotech specifically limited its warranties and required that Flotech pass along GE’s disclaimers and limitations. Berge contracted solely with Aibel, and each respectively limited its warranty and damages exposure to the other. Aibel had an intermediate contract with Flotech, with its own warranties and limitations. GE, however, had no negotiations or contract with, nor opportunity to reach terms with Berge directly. Although Flo-tech apparently complied with the “pass-along” requirement of liability limitations, as evidenced by a provision in the Flotech-Aibel contract, there is no evidence that Aibel communicated this term or gave a copy of the GE-Flotech contract to Berge. In contrast to the warranty actions contemplated by East River where “[t]he manufacturer can restrict its liability, within limits, by disclaiming warranties or limiting remedies,” 476 U.S. at 873, 106 S.Ct. 2295, the parties at bar elected not to provide this opportunity. Finally, Berge is and was a sophisticated commercial party. Had it so desired, it could have negotiated express warranties in an agreement with GE. Berge, in this manner, could have memorialized any promises or warranties related to GE’s design and manufacture of the compressors on which it sought to rely. But, Berge did not do so. Under East River principles, Berge’s failure to enter into such an agreement at the outset weighs against permitting it to obtain such relief now. See id. at 873-75, 106 S.Ct. 2295. “Since a commercial situation generally does not involve large disparities in bargaining power, we see no reason to intrude into the parties’ allocation of the risk.” Id. at 873, 106 S.Ct. 2295 (citations omitted). This result is consistent with Fifth Circuit decisions applying East River. The Fifth Circuit has extended that case’s economic loss rule to the maritime warranty of workmanlike performance arising from contracts for professional services. See Emp’rs Ins. of Wausau v. Suwannee River Spa Lines, Inc., 866 F.2d 752, 766 (5th Cir.1989) (“[A] party that provides professional services as part of the manufacture or construction of a product has no duty in maritime tort, independent of its contractual obligations, to prevent the product from injuring itself.” (citation omitted)). The Fifth Circuit has also declined to recognize a post-sale negligence exception to the maritime economic loss doctrine. See Turbomeca, S.A. v. Era Helicopters LLC, 536 F.3d 351, 356 (5th Cir.2008) (“The policy of economic loss is better adjusted by contract rules than by tort principles. This conclusion is as true for strict liability and negligence cases as it is for failure to warn cases.” (quoting Sea-Land Serv., Inc. v. Gen. Electric Co., 134 F.3d 149, 155-56 (3d Cir.1998))). While these cases do not involve claims of express or implied warranties, they apply East River's reasoning to reaffirm the principle that maritime law does not require manufacturers to protect, independent of any contractual obligation, a commercial product from injuring itself. See Wausau, 866 F.2d at 763 (“We conclude that East River's broad concern for preserving the integrity of contract law in commercial settings applies equally [here].”); cf. Chevron USA, Inc. v. Aker Mar., Inc., 604 F.3d 888, 900 (5th Cir.2010) (“If the damage is instead to the product itself or a loss of profits, the action properly is in warranty or contract, for responsibility for those damages can more reasonably be the subject of negotiations.” (citation omitted)). East River applies similarly to bar Berge’s warranty claims here. The Court concludes that East River does not support abandonment of the privity requirement in warranty actions under maritime law. The Court concludes that Berge’s warranty claims against GE fail for lack of privity in this maritime action. 4. Conclusion In this case, the need for uniformity in maritime law, the absence of strong Texas state interests, and East River’s broad concern for preserving the integrity of contract law, preclude the application of general U.C.C. or Texas warranty law on privity in this case. Applying East River by analogy, this Court holds that Plaintiff Berge’s breach of express warranty and implied warranty of fitness claims are not legally viable. III. MERITS OF WARRANTY CLAIMS A. Affirmations Even if East River did not bar Plaintiff Berge’s warranty claims, this Court concludes that Berge has not proved under Texas law its warranty claims by a preponderance of the evidence. The Court concludes that GE did not breach any of the express warranties that may have existed and did not prove the compressors were unfit for the particular purpose for which they were provided, or that Berge in fact reasonably relied on any warranties made by GE. The Court also concludes that Berge has not proven by a preponderance of the evidence that Berge’s claimed economic damages were proximately caused specifically by problems with GE’s compressors. Thus, even applying Texas law as Berge requests, Berge has not met its burden of proof on these issues. 1. Express Warranties An express warranty is created when “[a]ny affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise.” Tex. Bus. & Com. Code § 2.313(a)(1); see also Am. To bacco Co. v. Grinnell, 951 S.W.2d 420, 436 (Tex.1997) (citation omitted); Lyda Constructors, Inc. v. Butler Mfg. Co., 103 S.W.3d 632, 637 (Tex.App.-San Antonio 2003, no pet.) (citations omitted); Crosbyton Seed Co. v. Medium Farms, 875 S.W.2d 353, 361 (Tex.App.-Corpus Christi 1994, no pet.) (citation omitted). To recover for breach of express warranty, a plaintiff must prove, inter alia, that the defendant made an express affirmation of fact or promise. See, e.g., Chilton Ins. Co. v. Pate & Pate Enters., Inc., 930 S.W.2d 877, 890-91 (Tex.App.-San Antonio 1996, writ denied); Valley Datsun v. Martinez, 578 S.W.2d 485, 490 (Tex.Civ.App.-Corpus Christi 1979, no writ). Determining whether a statement is an “affirmation of fact or promise” or is “mere puffing” or “opinion” is a fact-specific inquiry focused on whether the seller asserted a fact of which the buyer is ignorant or whether, in contrast, the seller made a statement regarding a matter about which the buyer may also have an opinion. See, e.g., Valley Datsun, 578 S.W.2d at 490. Courts generally consider several factors, including the specificity and frequency of the statement, as well as the comparative knowledge of the buyer and seller. See U.S. Pipe & Foundry Co. v. City of Waco, 130 Tex. 126, 108 S.W.2d 432, 436 (1937); GJP, Inc. v. Ghosh, 251 S.W.3d 854, 889 (Tex.App.-Austin 2008, no pet.); Helena Chem. Co. v. Wilkins, 18 S.W.3d 744, 756 (Tex.App.-San Antonio 2000), aff'd, 47 S.W.3d 486 (Tex.2001); Valley Datsun, 578 S.W.2d at 490. Berge argues that GE made two sets of express warranties. Berge contends that GE made express warranties (a) during and immediately after the February 2004 Oslo meeting and (b) in the August 13, 2004 EZ Size Data Sheet, a one-page eomputer printout of information about the proposed compressors. a. February 2004 Statements According to Berge, the February 2004 warranties consisted of affirmations (1) that GE’s compressors could reliably provide 70 mmscfd of compressed gas at a specified design suction pressure and, thus, were suitable for Berge’s FPSO needs, (2) that the units were suitable for operation at 1200 rpm, (3) that all components of the compressor could tolerate 72,-752 lbs. of pressure on the components when the compressors were in continuous operation, (4) that the compressors would be equipped with stainless steel piston rods, and (5) that the compressors would present “no problems” and be “problem-free” in operation. Berge urges that GE made statements (1) and (5) orally at the February 2004 Oslo meeting and statements (1), (2), (3), and (4) in writing via a promotional flyer and a February 9, 2004 EZ Size Data Sheet given to Berge within a few days after the Oslo meeting. This Court finds the February 2004 statements regarding 70 mmscfd output, 1200 rpm, and 72,752 lb. rod load were made preliminarily, based on various assumptions and conditions of which the parties were aware and which later were unmet. These three statements therefore were too tentative to constitute affirmations of fact or promises for warranty purposes. The February 2004 Oslo gathering was a sales pitch meeting arranged by Aibel to introduce Flotech and GE personnel, their companies’ capabilities, and a new product, the SHMB604 compressor, to Berge. At that time, the parties all believed and intended that the design parameters would include a suction pressure of 174 psig. Thereafter, in April and May 2004, during the design phase for the compressors and the compression module, Flo-tech told GE that the suction pressure had to be reduced from 174 psig to 133 psig, a very significant amount. GE stated that under those conditions, its SHMB604 compressor could not produce the 70 mmscfd requested. Flotech later raised the specified suction pressure to 144 psig. In response, GE informed Flotech that GE still could not reach the requested 70 mmscfd capacity at that suction pressure. In February, 2004, all participants in the project also understood from the outset that the Chinguetti oil and gas field was totally undeveloped; no wells had even been attempted. Indeed, at this time, the participants were awaiting specific actual (as contrasted with merely projected) data on the seabed fluid’s composition and pressures. More definite field data was not provided to GE until at least May 2004, and even that was tentative. All were, in February 2004, relying on the Chinguetti “P50 profile,” which showed 72 mmscfd as the approximate maximum gas production rate, with most predicted production falling well below that figure. It is clear that all GE (and Flotech) estimates of compressor or compression module performance were necessarily conditioned upon receipt of more accurate data on the field’s actual performance and conditions. The Court also holds that GE’s statements in the promotional flyer about including stainless steel piston rods in the compressors is not an “affirmation” for purposes of an express warranty. See Chilton Ins., 930 S.W.2d at 890-91. The evidence establishes that GE originally planned to use stainless steel piston rods in its compressors for the BERGE HELENE, but GE did not initially do so. The law draws a distinction between a breach of warranty claim and a breach of contract claim. See Brooks, Tarlton, Gilbert, Douglas & Kressler v. U.S. Fire Ins. Co., 832 F.2d 1358, 1374-75 (5th Cir.1987); Beauty Mfg. Solutions Corp. v. Ashland, Inc., 848 F.Supp.2d 663, 671-72 (N.D.Tex.2012); Contractor’s Source Inc. v. Hanes Cos., Inc., No. 09-CV-0069, 2009 WL 6443116, at *5-6 (S.D.Tex. Dec. 29, 2009) (Ellison, J.); Lyda Constructors, 103 S.W.3d at 637. Any alleged promise of stainless steel piston rods is a “contract term identifying] what is being sold,” and not a warranty “describing] attributes, suitability for a particular purpose, and ownership of what is sold.” Beauty Mfg., 848 F.Supp.2d at 671 (citation omitted); Lyda Constructors, 103 S.W.3d at 637 (citation omitted); Chilton Ins., 930 S.W.2d at 891 (citation omitted). Thus, no warranty claim lies for GE’s omission in this regard. Berge also contends that GE’s representative stated that the compressors would be suitable for Plaintiffs needs and have “no problems.” The evidence that GE representatives made these statements as promises of flawless operation of the compressors is unpersuasive. To the extent these “no problems” phrases were spoken, they more likely than not referred to the delivery of the equipment and are not actionable affirmations of fact regarding problem-free performance of the compressors or the M60 compression module throughout their operation, as Berge contends. The witnesses did not persuade the Court that these statements constituted anything more than sales promotion touting of GE’s skills and experience generally, essentially puffing, during a “get-to-know-you” meeting. The comments, to the extent made, were made at a time when field conditions were unknown, before any work had been done in the field, prior to the design of the compressors and the associated equipment, and under circumstances that all concerned knew were extremely tentative. These were not actionable warranties. See Prudential Ins. Co. of Am. v. Jefferson Assocs., Ltd., 896 S.W.2d 156, 163 (Tex.1995); Dowling v. NADW Mktg., Inc., 631 S.W.2d 726, 729 (Tex.1982) (citing Gulf Oil Corp. v. Fed. Trade Comm’n, 150 F.2d 106, 109 (5th Cir.1945)); Dinn v. Hooking Bull Boatyard, Inc., No. C-08-309, 2010 WL 3909323, at *11 (S.D.Tex. Sept. 30, 2010) (Rainey, J.). b. August 2004 Statements According to Berge, the August 2004 warranties consisted of certain specifications in the August 13, 2004 EZ Size Data Sheet created by GE and eventually provided to Berge by Flotech, through Aibel, as part of the compression module’s final documentation. Specifically, Berge points to alleged affirmations (1) that the compressors could reliably provide 70 mmscfd at the design suction pressure (148 psig), (2) that the units were suitable for continuous operation at 1200 rpm, and (3) that all components of the compressor could tolerate 72,752 lb. “rod load” in continuous operation. GE’s figures on the August 2004 Data Sheet supplied in August 2004 (unlike the figures in February 2004) were made after GE had received some additional information about the actual field conditions, although well before meaningful drilling or development of the field. Generally, statements describing the specific capacity or performance capabilities of goods constitute affirmations for warranty purposes. See, e.g., S-C Indus. v. Am. Hydroponics Sys., Inc., 468 F.2d 852, 854-55 (5th Cir.1972) (applying Texas law and holding that a greenhouse plan specification stating “42’ Rigid Steel Frame all bolt connections-20 PSF Snow-load, 16 PSF Windload” constituted an express warranty that the greenhouse structure, as a unit, would withstand a vertical load of 20 pounds per square foot); Cmty. Television Servs. v. Dresser Indus., 586 F.2d 637, 639-41 (8th Cir.1978) (applying South Dakota law and holding that an advertising brochure statement that a broadcasting tower could withstand wind velocity and ice loads typical to that region constituted an express warranty). The Court will assume without definitively deciding that the requirement of an affirmation of fact or promise was met by the August 2004 Data Sheet’s specifications that the compressors, when operating at 1200 rpm, would compress 70 mmscfd of gas and would withstand 72,752 lbs. of rod load. See S-C Indus., 468 F.2d at 853-55. These affirmations, however, were conditioned specifically on Flotech and/or Aibel’s promises that there would be suction pressure of 148 psig. It is undisputed that, during the summer of 2004, GE refused to commit to providing 70 mmscfd at inlet pressures of 133 or 144 psig. Only-after Flotech promised to modify its packaging to provide suction pressure of 148 psig did GE commit to its compressors compression 70 mmscfd of gas and did GE issue an Order Acknowledgement containing these parameters. In addition, the evidence is clear that these affirmations concerning 70 mmscfd and the 72,752 lb. rod load at 1200 rpm also were conditioned on Flotech’s properly packaging the GE compressors into the compression module and Aibel’s proper installation and maintenance of the module. 2. Implied Warranty of Fitness for a Particular Purpose “Where the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller’s skill or judgment to select or furnish suitable goods, there is unless excluded or modified under [Tex. Bus. & Com. Code § 2.316] an implied warranty that the goods shall be fit for such purpose.” Tex. Bus. & Com. Code § 2.315; see also Am. Tobacco Co., 951 S.W.2d at 435; LaBella v. Charlie Thomas, Inc., 942 S.W.2d 127, 131 (TexApp.-Amarillo 1997, writ denied) (discussing implied warranties and disclaimers). To prevail in an action for breach of implied warranty of fitness for a particular purpose, the plaintiff must establish, inter alia, that the defendant knew or should have known the plaintiff was buying goods for a particular purpose. See Crosbyton Seed, 875 S.W.2d at 365-66. A “particular purpose” is a specific use by the buyer that is peculiar to the nature of the buyer’s business, and differs from an ordinary purpose, which is the purpose envisaged in the concept of merchantability and goes to the uses that are customarily made of the goods. Tex. Bus. & Com. Code § 2.315 cmt. 2; ASAI v. Vanco Insulation Abatement, Inc., 932 S.W.2d 118, 122 (Tex.App.-El Paso 1996, no writ) (citing Crosbyton Seed, 875 S.W.2d at 365) (other citation omitted). The Court finds that GE generally knew that the three SHMB604 compressors were to be installed in a compression module