FILED
Jun 04 2026, 9:02 am
IN THE CLERK
Court of Appeals of Indiana
Indiana Supreme Court
Court of Appeals
and Tax Court
Whitesell Precision Components Inc.,
Appellant-Plaintiff
v.
Autoform Tool & Manufacturing LLC,
Appellee-Defendant
and
Hitachi Automotive Systems Inc.,
Defendant
June 4, 2026
Court of Appeals Case No.
25A-PL-1182
Appeal from the Marion Superior Court
The Honorable Heather A. Welch, Senior Judge
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 1 of 23
Trial Court Cause No.
49D01-1610-PL-36015
Opinion by Judge DeBoer
Judges Brown and Altice concur.
DeBoer, Judge.
Case Summary
[1] Whitesell Precision Components Inc. (Whitesell) and Autoform Tool &
Manufacturing LLC (Autoform) have been engaged in nearly a decade of
litigation arising out of a contract dispute. After three interlocutory appeals and
just as many bench trials, the case has returned to this Court for the fourth time,
now after the entry of final judgment in which both Whitesell and Autoform
prevailed on competing breach of contract claims. Because Whitesell’s
damages were larger than Autoform’s, the net damages award was in
Whitesell’s favor. On appeal, Whitesell argues that because Autoform
committed the first material breach of contract, it should have been precluded
from recovering damages on its breach of contract counterclaims. We agree
and thus reverse the trial court’s judgment in Autoform’s favor on that claim
and remand with instructions for the court to recalculate the net damages
award.
[2] Autoform cross-appeals the trial court’s denial of its motion to correct error
regarding its request for attorneys’ fees, arguing in part that the court erred in
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 2 of 23
concluding it was not a “prevailing party” under Indiana Code section 34-52-1-1. Because we find Autoform’s breach of contract counterclaim must fail since
Autoform was the first to materially breach the parties’ contract, we affirm the
trial court’s denial of the motion to correct error.
Facts and Procedural History
The Parties’ Contractual Relationships
[3] In the first interlocutory appeal in this case, the panel described the parties and
their relationship as follows:
Whitesell is in the business of manufacturing and distributing
engineered, specialty, and standard components and parts used in
various industries, including in the assembly and manufacture of
automobiles. Autoform is in the business of manufacturing
components used in the assembly and manufacture of
automobiles. Autoform use[d] injector cups supplied by
Whitesell to produce fuel rail assemblies that Autoform [sold] to
Hitachi America, Ltd. (“Hitachi”). Hitachi place[d] fuel injectors
into Autoform’s fuel rail assemblies, and the finished products
[were] installed into automobiles.
Whitesell Precision Components, Inc. v. Autoform Tool & Mfg., LLC, 110 N.E.3d 380,
381-82 (Ind. Ct. App. 2018) (footnote omitted), trans. denied. Hitachi,
Autoform, and Whitesell were in a “directed-buy” relationship, meaning
Hitachi required Autoform to purchase injector cups from Whitesell, if
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 3 of 23
Whitesell complied with certain conditions. 1 Among other conditions,
Whitesell was required to sell injector cups (1) that satisfied Hitachi’s
specifications, and (2) for a competitive price approved by Hitachi.
[4] In late 2013, Hitachi approved Whitesell’s initial proposal to sell injector cups
for $2.47 per unit. Before production began, Hitachi told Autoform that it may
need to scale back its estimated production volume. Autoform then requested
an updated price quote from Whitesell, and Whitesell provided a low-volume
quote of $2.74 for each injector cup. When production began in late 2014,
Hitachi instructed Autoform to purchase the injector cups at the high-volume
price of $2.47, but in June 2015, the anticipated low-volume production
scenario became a reality, and Hitachi began issuing contracts to Autoform that
contemplated the low-volume price of $2.74. However, Autoform did not
inform Whitesell of that development and instead continued to purchase
injector cups at the high-volume price. In essence, this meant Autoform
pocketed the 27-cent difference between the $2.74 paid by Hitachi and the $2.47
Autoform paid to Whitesell.
1
In a directed-buy arrangement, “the customer requires that its direct supplier (the ‘Tier 1 Supplier’)
purchase from a specific sub-supplier (the ‘Tier 2 Supplier’) certain raw materials, parts[,] or components . . .
for integration into the product that the Tier 1 Supplier sells to the customer . . . .” Kathleen E. Wegrzyn,
Best Practices for Customers Structuring Directed-Buy Arrangements, THE NATIONAL LAW REVIEW (Jan. 30, 2019),
https://natlawreview.com/article/best-practices-customers-structuring-directed-buy-arrangements
[https://perma.cc/8V3R-M2F6].
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 4 of 23
Whitesell Demands the Low-Volume Price
[5] In early 2016, Whitesell realized that though Autoform was paying the high
production volume price, the number of injector cups it ordered tracked the
low-volume production estimates. Accordingly, Whitesell demanded that
Autoform pay the $2.74 price, retroactive to when the low-volume shipments
began to account for the “alleged ‘payment shortfall’ of $343,154.15.”
Appellant’s Appendix Vol. 2 at 228. Autoform refused, and Whitesell
threatened to stop shipments if Autoform did not agree to its demands by
October 1. That deadline was extended while they attempted to reach a
resolution, but in September, Whitesell filed a complaint for breach of contract
against Autoform. Whitesell voluntarily dismissed that complaint only to refile it on October 11—the same day on which Autoform filed its own complaint
alleging breach of contract, and other claims, against Whitesell. The parties
agreed to consolidate their claims under Whitesell’s action, and Autoform refiled its claims as counterclaims.
Temporary Restraining Order and Preliminary Injunction
[6] In December, Whitesell stopped shipping injector cups to Autoform after
negotiations between the parties broke down. On the 27th, Autoform filed a
motion for a temporary restraining order (a TRO) and asked the trial court to
order Whitesell to continue selling injector cups at “$2.47[] . . . [for] all of
Autoform’s future orders[.]” Appellee’s App. Vol. 2 at 13. In its brief
supporting the TRO request, Autoform argued that Whitesell’s claims were “a
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 5 of 23
bad faith attempt to manufacture a retroactive price increase[.]” 2 It further
argued that it would suffer irreparable harm if Whitesell was not ordered to
continue supplying it with injector cups because it operated on a “just-in-time”
inventory system. 3 Whitesell opposed the TRO, arguing it would “force[]
[Whitesell] to continue shipping injector cups at a lower price than agreed . . .
.” 4 After a hearing, the trial court issued a TRO in early January 2017 requiring
Whitesell to continue selling injector cups at the high-volume price. The parties
later agreed to convert the TRO to a preliminary injunction.
[7] After securing the preliminary injunction, Autoform began accusing Whitesell
of supplying it with injector cups that did not conform with Hitachi’s
specifications. In October 2017, the court entered a pre-trial order permitting
Autofom to “debit Whitesell’s account for each defective injector cup
delivered.” Whitesell Precision Components, 110 N.E.3d at 383. In early 2018,
Whitesell moved to dissolve the preliminary injunction, arguing Autoform had
been given adequate time to find a new supplier, and performing under what
Whitesell characterized as an inequitable injunction was causing it to suffer
2
Autoform’s Brief in Support of Emergency Motion for Temporary Restraining Order at 2, Whitesell Precision
Components, Inc. v. Autoform Tool & Mfg., LLC (Dec. 27, 2016) (No. 49D01-1610-PL-36015).
Though neither party included this filing (or several other relevant documents) in their respective appendices,
all documents filed with the trial court in this case are part of the record on appeal. Ind. Appellate Rule 27.
We’ve accessed several of those documents using our Odyssey Case Management System.
3
Autoform’s Brief in Support of Emergency Motion for Temporary Restraining Order, supra note 2, at 4.
4
Plaintiff’s Response to Defendant’s Emergency Motion for Temporary Restraining Order at 14, Whitesell
Precision Components (Jan. 3, 2017) (No. 49D01-1610-PL-36015).
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 6 of 23
additional damages. The trial court denied Whitesell’s motion, crediting
Autoform’s claim that it would take more than a year for it to find a new
supplier and reasoning Whitesell had adequate legal remedies if judgment was
ultimately entered against Autoform. This Court affirmed that denial in an
interlocutory appeal. Id. at 387.
[8] In January 2021, Hitachi gave Autoform permission to purchase injector cups
from a new supplier. Thereafter, Autoform moved to dissolve the preliminary
injunction. Whitesell opposed that motion and argued that before dissolving
the preliminary injunction, the trial court should impose several conditions.
These included modifying the injunction’s price to $2.74, with Autoform
required to post a bond that accounted for the 27-cent difference between the
low-volume and high-volume prices for all injector cup shipments made after
injunctive relief was entered in 2017.
2021 Bench Trial on the Price Dispute
[9] On March 3 and 4, 2021, while the motion to dissolve the preliminary
injunction was pending, the court held a two-day bench trial on the parties’
numerous claims and counterclaims. The parties agreed to bifurcate the issues
of liability and damages, with the 2021 bench trial focused on liability only.
They also agreed that Autoform’s claims regarding “nonconformities in
Whitesell’s [i]njector [c]ups” would be stayed until the court determined
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 7 of 23
whether those claims were subject to arbitration. 5 Appellant’s App. Vol. 3 at 4.
The 2021 trial also addressed a motion for default judgment Whitesell filed
against Autoform for its alleged litigation misconduct, including allegations that
Autoform failed to produce responsive documents in discovery and submitted
false and misleading evidence to secure the TRO and preliminary injunction.
Two months later, in May, the court held another hearing on whether to
dissolve the injunction.
[10] The trial court entered two separate orders on August 10, which did five things
relevant to this appeal. First, the court denied Whitesell’s motion for default
judgment, reasoning Autoform’s conduct did not justify such a harsh sanction
and “Whitesell ha[d] a remedy to recover its legal expenses through seeking
reasonable attorney’s fees” later in the proceedings. Id. at 39. Second, the court
found as follows:
Whitesell’s initial filling of the purchase orders is understandable
since the $2.47 figure was a previous quotation based on
anticipated orders from Hitachi. Once it became apparent that
the actual order volumes tracked the lower volume estimate,
Whitesell reasonably demanded that it be compensated based on
the [i]njector [c]up figure it quoted for the lower volume scenario,
5
Whitesell moved to compel arbitration in January 2018. The trial court denied that motion in August 2018
after finding unresolved questions of fact about whether the parties had entered into an arbitration agreement.
This Court affirmed that finding in a second interlocutory appeal. Whitesell Precision Components, Inc. v.
Autoform Tool & Mfg., LLC, 129 N.E.3d 830 (Table), 2019 WL 2588359, at *5 (Ind. Ct. App. June 25, 2019)
(unpublished). While the panel’s opinion left open the possibility that Whitesell could compel arbitration
after the trial court resolved those questions of fact, id. at *5 n.5, the court ultimately concluded that the
parties had not agreed to arbitration.
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 8 of 23
which Hitachi had accepted since [the low volume] revised part
projections became real.
While there was no one governing document for the [i]njector
[c]up price, . . . the [p]arties were bound by a contractual
arrangement through the course of performance. That course of
performance established the price per [i]njector [c]up at $2.74
once Hitachi deemed that bid from Whitesell “[c]ompetitive” in
light of the anticipated readjustment of . . . estimated orders
beginning July 1, 2015.
Id. at 44. Third, the court ruled that Autoform was liable to Whitesell for
breach of contract because it had failed to pay the high-volume price after July
1, 2015, but found in Autoform’s favor on several other theories of relief
Whitesell raised. Fourth, the court characterized Autoform’s argument that
Whitesell had not complied with certain contractual conditions as “irrelevant
since Autoform first materially breached th[e] agreement by failing to remit the
full [i]njector [c]up price . . . .” Id. at 45. Finally, the court granted Autoform’s
motion to dissolve the injunction, subject to certain conditions designed to
protect Whitesell from further harm. Autoform challenged those conditions in
a third interlocutory appeal, and this Court affirmed. Autoform Tool & Mfg., LLC
v. Whitesell Precision Components, Inc., 197 N.E.3d 852 (Table), 2022 WL
10861415, at *8 (Ind. Ct. App. Oct. 19, 2022) (unpublished).
2023 Bench Trial on the Alleged Manufacturing Defects
[11] In March and April 2023, the trial court held a three-day bench trial regarding
liability on the counterclaims raised by Autoform that had not been addressed
during the 2021 bench trial. Those included claims for breach of contract,
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 9 of 23
declaratory judgment, and unjust enrichment related to the alleged deficiencies
in Whitesell’s injector cups. The parties also addressed Whitesell’s claim for
attorneys’ fees under Indiana Code section 34-52-1-1(b), which it filed after the
court denied its request for default judgment in 2021. Again, the parties agreed
to address damages at a later date.
[12] In its September findings of fact and conclusions of law, the trial court
concluded that Whitesell had breached its contract with Autoform in several
respects after making unauthorized changes to its manufacturing processes that
caused issues with the quality of its injector cups. It also rejected Whitesell’s
argument that Autoform, having first materially breached the parties’ contract,
was precluded from recovering damages for Whitesell’s subsequent breaches.
On that issue, the court reasoned as follows:
60. The Court . . . reaffirms its finding from the August
2021 order that Autoform committed the first material breach of
their contract. Autoform’s initial breach occurred first because
Autoform failed to pay the contract price for the [i]njector [c]ups
prior to any of Whitesell’s breaches with respect to part quality.
61. Typically, this would mean that Autoform would be
unable to enforce the contract against Whitesell in return. . . .
62. [But] [i]n cases where parties intend to continue
their relationship beyond an initial breach, the Indiana Court of
Appeals has held that, in such instances, the non-breaching party
has two alternative courses of action following the breach: (1)
terminate the contract or (2) continue on with the contract, so
long as the non-breaching party also fulfills its obligations under
the contract to avoid an inequitable result. Watson Water Co., Inc.
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 10 of 23
v. Indiana-Am. Water Co., Inc., 85 N.E.3d 840, 849 (Ind. Ct. App.
2017) (citing [Se.] Land Dev. Ltd v. Primrose Mgmt. L.L.C., . . . 952
N.E.2d 563, 571 (Ohio Ct. App. 2011)) [reh’g denied]. As stated
in Watson Water, if the non-breaching party opts to continue with
the contract, that party is still obligated to perform their
contractual obligations.
63. The Court finds that because Whitesell and
Autoform continued their contractual relationship, Whitesell
remained obligated to uphold its obligations to manufacture the
[i]njector [c]up using the agreed upon [manufacturing]
process[es]. By changing [them] without authorization from
Autoform or Hitachi, Whitesell breached this obligation. Even
with Autoform’s breach over the price, the Court finds it would
be inequitable not to allow Autoform to seek actual damages for
Whitesell’s unauthorized changes in the [i]njector [c]up
manufacturing process.
Appellant’s App. Vol. 3 at 130-31.
[13] Regarding Whitesell’s attorneys’ fee request, the court found that Whitesell was
entitled to recover fees it incurred in litigating the parties’ dispute over price. In
relevant part, the court reasoned as follows:
[E]ffective July 1, 2015, Autoform knew that Hitachi had
approved and would be paying Whitesell’s $2.74 [i]njector [c]up
price. Autoform, however, hid that information from Whitesell
and, later, the Court. . . .
By May 2016, Whitesell began asserting it should be paid its
$2.74 price. Autoform instead argued that Whitesell was seeking
a price “increase.” If Autoform had been forthright and paid
Whitesell the price Autoform should have been paying all along,
this litigation could have been avoided at the outset.
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 11 of 23
When Whitesell told Autoform it would not ship [i]njector [c]ups
if Autoform didn’t pay the $2.74 price retroactively, Autoform
turned to this Court to seek injunctive relief. . . . Autoform hid
from the Court and Whitesell the fact that Hitachi had approved
and been paying Whitesell’s $2.74 price. The Court would have
considered that fact on whether Autoform was likely to prevail
on the merits or in setting the price to be paid during the term of
the TRO and agreed preliminary injunction.
. . . During [the] discovery process, Autoform offered an expert
opinion from Jeoff Burris, who didn’t know any better, and
[deposition] testimony from Autoform’s Tim Parys, who did,
that Hitachi had not approved Whitesell’s $2.74 price.
Id. at 136-37 (internal citations omitted). Accordingly, the court concluded
Autoform had litigated the price dispute in bad faith. But the court reached a
different conclusion regarding the fees Whitesell incurred in defending against
Autoform’s defect-related counterclaims. Specifically, it found that Whitesell
had itself engaged in misconduct by presenting “untruthful testimony” and
“withhold[ing] information regarding the manufacturing process that may have
terminated this litigation earlier.” 6 Id. at 138-39. Accordingly, the court ruled
that Whitesell could “not recover attorney’s fees for work on the part quality
issues.” Id. at 139.
6
The trial court had already sanctioned Whitesell for that misconduct in March 2023, which included an award of attorneys’ fees to Autoform for preparing and taking certain depositions.
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 12 of 23
Autoform’s Request for Attorneys’ Fees
[14] In October 2023, Autoform moved to amend the court’s May 2023 sanctions
order, see supra note 6, “to further sanction Whitesell, pursuant to Ind. Code §
34-52-1-1, for maintaining frivolous, unreasonable, or groundless defenses to
Autoform’s quality counterclaim and/or litigating those defenses in bad faith.”
Appellee’s App. Vol. 2 at 69. The court denied that motion in January 2024,
reasoning Autoform’s fee request was “premature because Autoform ha[d] not
been deemed a prevailing party because the amount of damages actually
suffered by Autoform, if any, ha[d] not been determined.” Id. at 176.
Additionally, the court found “no basis to expand the scope of the sanctions
against Whitesell that the Court previously awarded to Autoform . . . .” Id. at
177.
2024 Bench Trial on the Parties’ Damages
[15] In November 2024, the trial court held a bench trial to determine the parties’
respective damages. In its April 2025 order, the court awarded Whitesell
$5,136,165.77 in damages for Autoform’s breach of contract, $1,312,585.51 in
damages related to the 2021 order dissolving the preliminary injunction, and
$1,129,962.51 in attorneys’ fees, for a total award of $7,578,713.79. To
Autoform, the court awarded $2,588,267.25: $60,000 in attorneys’ fees pursuant
to the sanctions order and $2,528,267.25 in damages on its breach of contract
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 13 of 23
counterclaim. 7 After offsetting the parties’ damages and giving Autoform credit
for sums it had already paid, the court calculated a net damages award to
Whitesell totaling $4,313,130.03.
[16] Autoform filed a motion to correct error, arguing that because it was awarded
damages on its counterclaims, it was a “prevailing party” under Indiana Code
section 34-52-1-1 and should be awarded additional attorneys’ fees under that
statute. The court denied that motion, reasoning in part that “[w]hile Autoform
was awarded damages, it received no judgment . . . as its [damages] were used
to offset Whitesell’s . . . , resulting in a final damages award only to Whitesell.”
Appellee’s App. Vol. 3 at 54. Thus, the court found Autoform could not “be
considered the prevailing party.” Id.
Discussion and Decision
1. Whitesell’s First Material Breach Defense
[17] The sole issue raised by Whitesell on appeal is whether the trial court erred in
ruling in Autoform’s favor on its breach of contract counterclaim, even though
it found Autoform committed the first material breach of contract. To support
that contention, Whitesell cites the well-established rule “that ‘[w]hen one party
7
In the trial court’s conclusions of law, it determined “Whitesell must pay Autoform damages that total
$2,588,267.05.” Appellant’s App. Vol. 2 at 219 (emphasis added). However, due to an apparent
typographical error, the court’s judgment listed Autoform’s damages as “2,588,267.25.” Id. at 221 (emphasis
added). We note this de minimis 20-cent discrepancy only to explain the difference between the values used
by Whitesell in its briefs (which cited the court’s judgment) and by Autoform (which cited the court’s
conclusions of law).
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 14 of 23
to a contract commits the first material breach of that contract, it cannot seek to
enforce the provisions of the contract against the other party if that other party
breaches the contract at a later date.’” TKG Assocs., LLC v. MBG Monmouth,
LLC, 259 N.E.3d 306, 316 (Ind. Ct. App. 2025) (quoting A House Mechs., Inc. v.
Massey, 124 N.E.3d 1257, 1262 (Ind. Ct. App. 2019)) (alteration in original),
reh’g denied.
[18] We begin by noting that Whitesell’s opening brief does not set forth “the
applicable standard of review” as required by Appellate Rule 46(A)(8)(b). Nor
did Whitesell contest in its reply brief Autoform’s assertion that the first
material breach rule is an affirmative defense, meaning Whitesell is appealing
from a negative judgment. Because Whitesell did not contest it, we assume for
the purposes of this discussion that the negative judgment standard of review
applies to Whitesell’s appeal. A prior panel of this Court summarized that
standard of review as follows:
A judgment entered against a party who bore the burden of proof
at the trial court is a negative judgment. Smith v. Dermatology
Assocs. of Fort Wayne, P.C., 977 N.E.2d 1, 4 (Ind. Ct. App. 2012).
On appeal, we will not reverse a negative judgment unless it is
contrary to law. Id. When determining whether a judgment is
contrary to law, we consider the evidence in the light most
favorable to the appellee, together with all the reasonable
inferences to be drawn therefrom. Id. A party appealing from a
negative judgment must show that the evidence points unerringly
to a conclusion different than that reached by the trial court. Id.
When a trial court enters findings of fact and conclusions of law
thereon pursuant to Indiana Trial Rule 52, we apply the
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 15 of 23
following two-tiered standard of review: whether the evidence
supports the findings and whether the findings support the
judgment. Tompa v. Tompa, 867 N.E.2d 158, 163 (Ind. Ct. App.
2007). The trial court's findings and conclusions will be set aside
only if they are clearly erroneous, that is, if the record contains
no facts or inferences supporting them. Id. A judgment is clearly
erroneous when a review of the record leaves us with a firm
conviction that a mistake has been made. Id. We neither
reweigh the evidence nor assess the credibility of the witnesses,
but we consider only the evidence most favorable to the
judgment. Id. We review conclusions of law de novo. Id.
Sri Shirdi Saibaba Sansthan of Tri State, Inc. v. Farmers State Bank of Alto Pass, 194
N.E.3d 55, 59-60 (Ind. Ct. App. 2022), trans. denied.
[19] Despite finding that Autoform committed the first material breach of contract
(which Autoform does not challenge on appeal), the trial court concluded it
could still recover damages for Whitesell’s subsequent breaches under this
Court’s opinion in Watson Water Company. According to the trial court, that
opinion stands for the proposition that “if the non-breaching party opts to
continue with the contract, that party is still obligated to perform their
contractual obligations.” Appellant’s App. Vol. 3 at 131. According to
Whitesell, the court’s reasoning “stem[med] from a misreading of” this Court’s
opinion. Appellant’s Brief at 14. In turn, Autoform contends the trial court
properly cited Watson Water Company for “hornbook law” that has been adopted
by Indiana and “virtually every other jurisdiction[.]” Appellee’s Br. at 39.
Despite the confidence with which Autoform makes these sweeping claims,
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 16 of 23
Whitesell is right that Watson Water Company does not stand for the proposition
the trial court cited.
[20] Watson Water Company involved a water supply agreement between two water
utility companies: Watson Water Company Inc. (Watson) and IndianaAmerican Water Company Inc. (IAWC). 85 N.E.3d at 844. Under the
agreement, Watson was obligated to purchase a minimum yearly volume of
water from IAWC for forty years. Id. The agreement included a right-of-firstrefusal clause providing that if Watson wanted to purchase additional volumes
from another supplier, IAWC had the right to match the third-party supplier’s
terms. Id. at 845-46. When Watson failed to purchase the minimum volumes,
IAWC sued for breach of contract and for a declaration that Watson was
required to continue purchasing the minimum water volumes through the end
of the contract’s forty-year term. Id. at 846-47.
[21] After the trial court awarded IAWC contract damages and the requested
declaratory relief, Watson appealed, arguing in part that it had found a thirdparty supplier that offered better terms than IAWC, so it should be permitted to
terminate the contract due to IAWC’s failure to match the third-party’s terms.
Id. at 848-49. Further asserting the prior breach doctrine did not prevent it from
enforcing the right-of-first-refusal clause, Watson cited an Ohio Court of
Appeals opinion for the notion “that the prior breach doctrine is applicable only
when the non-breaching party treats the contract as terminated not continuing.”
Id. at 849 (citing Se. Land Dev., 952 N.E.2d at 571). First, the panel found that
Watson had not accurately expressed that case’s holding, as
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 17 of 23
[a] fair reading . . . suggests that the Ohio court held that the nonbreaching party may select whether to (1) terminate the contract
or (2) continue on with the contract, so long as the non-breaching
party also fulfills its obligations under the contract to avoid an
inequitable result.
Id. Second, the panel neither adopted the Ohio court’s holding nor did it give
any indication that Indiana recognized the same rule or one similar to it.
Instead, the panel concluded that the right-of-first-refusal clause did not give
Watson the right to terminate the contract and, in any event, “Watson did not
properly avail itself of the [right-of-first-refusal] clause” so IAWC had not
breached it. Id.
[22] In short, Watson Water Company’s discussion of Southeast Land Development was
merely a recitation of and response to Watson’s argument. The panel rejected
Watson’s framing of the issue and consequently did not reach the issue of first
material breach, rendering the discussion of Ohio law mere dicta. Therefore,
the trial court here clearly erred when it concluded that Watson Water Company
expressed a controlling legal principle on the issue of first material breach.
[23] We also note that Southeast Land Development involved Ohio’s version of the
doctrine of repudiation (also referred to as anticipatory breach), a wholly
separate doctrine from first material breach. See 952 N.E.2d at 569 (“If an
anticipatory breach of contract is found to occur, the injured party has the
option of either terminating the contract and suing the breaching party
immediately or continuing the contract and suing the breaching party for
damages after the time for performance has passed.”). Under Indiana law, the
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 18 of 23
doctrine of repudiation comes into play when a party makes a “positive,
absolute, and unconditional” statement repudiating a contract before the time
for performance. Metro Holdings One, LLC v. Flynn Creek Partner, LLC, 25
N.E.3d 141, 160 (Ind. Ct. App. 2014), trans. denied. In such a case, the nonbreaching party has “three options for recourse . . . .” Fischer v. Heymann, 12
N.E.3d 867, 872 (Ind. 2014), reh’g denied.
First, she could treat the contract as rescinded and recover in
quantum meruit as far as [she had] performed. Second, she could
keep the contract alive for the benefit of [all] parties, remaining at
all times ready, willing, and able to perform [her] part of the
contract; then, at the time fixed for performance, . . . sue and
recover according to the terms of the contract. Or third, she
could treat the breach or repudiation as putting an end to the
contract for all purposes of performance and sue at once to
recover the damages due from the wrongful refusal to carry out
the contract according to its terms.
Id. (internal quotation marks and citations omitted) (alterations in original).
[24] Throughout its argument, Autoform conflates the doctrine of repudiation with
the doctrine of first material breach without explaining why our precedents
related to repudiation should inform our first material breach analysis.
Moreover, despite claiming at one point in its argument that Fisher’s three
options apply after one party learns of the other’s first material breach,
Autoform contradicts itself by claiming the non-breaching party only has two
options for how to proceed:
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 19 of 23
OPTION 1: The non-breaching party can end the contract, cease
performing, and sue the breaching party for damages. This
option discontinues both parties’ obligations under the contract
going forward.
OPTION 2: The non-breaching party can keep the contract in
effect, retain the benefit and bargain of that contract, and sue the
breaching party for damages resulting from the original breach.
This option, however, requires both parties to continue
performing under the contract, and if either party thereafter fails
to meet its continuing contractual obligations going forward, a
separate action for breach and damages may be maintained.
Appellee’s Br. at 37. And as Autoform would have it, “[t]he doctrine of prior
material breach does not apply when the non-breaching party chooses Option
2.” Id. at 38.
[25] Autoform claims its proposed “two option” rule finds support in the
Restatement (Second) of Contracts, as well as in an Illinois Supreme Court
opinion recognizing “an exception to [Illinois’] first-to-breach rule.” PML Dev.
LLC v. Vill. of Hawthorn Woods, 226 N.E.3d 1163, 1174, 1175 (Ill. 2023) (“[T]he
non-breaching party may lose its right to assert the first-to-breach rule if it
accepts the benefits of the contract despite the other party’s material breach.”).
But Autoform has not cited (and we have not found) any Indiana authority
recognizing a similar exception. And we decline Autoform’s tacit invitation to
recognize that exception here because the record does not support a finding that
Whitesell “elect[ed] to continue with the contract” after learning of Autoform’s
breach. Id. at 1175. Quite the opposite, after becoming suspicious of
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 20 of 23
Autoform’s low-volume purchases, Whitesell demanded throughout 2016 that
Autoform pay the low-volume price, and when the parties were unable to
informally resolve the price dispute, Whitesell initiated litigation and ultimately
discontinued shipments. Whitesell only resumed shipping injector cups when
Autoform procured the TRO and, later, the preliminary injunction through
false testimony and a sham expert report that hid from Whitesell and the trial
court that Hitachi approved Whitesell’s proposed $2.74 price effective July
2015.
[26] Accordingly, even if we were to accept Autoform’s logic, Whitesell clearly
attempted to invoke “Option 1” by terminating the parties’ contractual
relationship and immediately suing for breach in late 2016. Therefore, as the
party guilty of the first material breach, Autoform would have no right to
recover against Whitesell for its subsequent breaches, which occurred after
injunctive relief was entered in 2017. See Williamson v. U.S. Bank Nat’l Ass’n, 55
N.E.3d 906, 914 (Ind. Ct. App. 2016) (“[A] party first guilty of a material
breach of contract may not maintain an action against the other party or seek to
enforce the contract against the other party should that party subsequently
breach the contract.” (quoting Klepper v. ACE Am. Ins. Co., 999 N.E.2d 86, 96
(Ind. Ct. App. 2013), reh’g denied, trans. denied). We thus reverse and remand
the trial court’s judgment in Autoform’s favor on its breach of contract
counterclaim with instructions for the court to enter judgment in Whitesell’s
favor on that claim and recalculate the net damages award accordingly.
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 21 of 23
2. Autoform’s Motion to Correct Error
[27] On cross-appeal, Autoform contends the trial court erred in denying its motion
to correct error regarding its request for attorneys’ fees under Indiana Code
section 34-52-1-1. Under that statute, a
court may award attorney’s fees as part of the cost to the
prevailing party, if the court finds that either party:
(1) brought the action or defense on a claim or defense that is
frivolous, unreasonable, or groundless;
(2) continued to litigate the action or defense after the party’s
claim or defense clearly became frivolous, unreasonable,
or groundless; or
(3) litigated the action in bad faith.
Ind. Code § 34-52-1-1(b). According to Autoform, the court’s conclusion that it
was not a prevailing party and could not recover fees under this statute was
erroneous because “Autoform prevailed on its breach of contract counterclaim[]
. . . .” Appellee’s Br. at 52. However, because we’ve reversed the trial court’s
judgment in Autoform’s favor on that counterclaim, we affirm its conclusion
that Autoform is not a prevailing party for purposes of the statute. See River
Ridge Dev. Auth. v. Outfront Media, LLC, 146 N.E.3d 906, 913 (Ind. 2020) (“[I]f a
party does not receive a favorable judgment, then it is not a ‘prevailing
party.’”).
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 22 of 23
Conclusion
[28] For these reasons, we (1) reverse and remand the judgment in favor of
Autoform on its breach of contract counterclaim with instructions for the trial
court to enter judgment in Whitesell’s favor on that claim and to recalculate the
net damages award accordingly, and (2) affirm the trial court’s denial of
Autoform’s motion to correct error.
[29] Reversed in part, affirmed in part, and remanded with instructions.
Brown, J., and Altice, J., concur.
ATTORNEYS FOR APPELLANT WHITESELL PRECISION COMPONENTS
INC.
Andrew W. Hull
Michael R. Limrick
Evan D. Carr
Hoover Hull Turner LLP
Indianapolis, Indiana
ATTORNEY FOR APPELLEE AUTOFORM TOOL & MANUFACTURING LLC
Maggie L. Smith
Frost Brown Todd LLP
Indianapolis, Indiana
Court of Appeals of Indiana Opinion - 25A-PL-1182 June 4, 2026 Page 23 of 23