[Cite as DSWDWK, L.L.C. v. Airgas USA, L.L.C., 2026-Ohio-3092.]
IN THE COURT OF APPEALS
FIRST APPELLATE DISTRICT OF OHIO
HAMILTON COUNTY, OHIO
DSWDWK, LLC, : APPEAL NO. C-250580
TRIAL NO. A-2301534
Plaintiff-Appellee, :
vs. :
AIRGAS USA, LLC, :
JUDGMENT ENTRY
Defendant-Appellant. :
This cause was heard upon the appeal, the record, the briefs, and arguments.
For the reasons set forth in the Opinion filed this date, the judgment of the trial court is reversed and the cause is remanded.
Further, the court holds that there were reasonable grounds for this appeal, allows no penalty, and orders that costs be taxed under App.R. 24.
The court further orders that (1) a copy of this Judgment with a copy of the Opinion attached constitutes the mandate, and (2) the mandate be sent to the trial court for execution under App.R. 27.
To the clerk:
Enter upon the journal of the court on 8/12/2026.
Pursuant to App.R. 30, the clerk is directed to send all parties, or their counsel if represented, a copy of the court’s judgment and note such action on the docket.
By:_______________________
Administrative Judge
[Cite as DSWDWK, L.L.C. v. Airgas USA, L.L.C., 2026-Ohio-3092.]
IN THE COURT OF APPEALS
FIRST APPELLATE DISTRICT OF OHIO
HAMILTON COUNTY, OHIO
DSWDWK, LLC, : APPEAL NO. C-250580
TRIAL NO. A-2301534
Plaintiff-Appellee, :
vs. :
AIRGAS USA, LLC, :
OPINION
Defendant-Appellant. :
Civil Appeal From: Hamilton County Court of Common Pleas
Judgment Appealed From Is: Reversed and Cause Remanded
Date of Judgment Entry on Appeal: August 12, 2026
Barron, Peck, Bennie & Schlemmer and Steven C. Davis, for Plaintiff-Appellee,
FBT Gibbons LLP and Ryan W. Goellner, Wegman Hessler Valore and Jay R. Carson, for Defendant-Appellant.
[Cite as DSWDWK, L.L.C. v. Airgas USA, L.L.C., 2026-Ohio-3092.]
KINSLEY, Presiding Judge.
{¶1} Defendant-appellant Airgas USA, LLC, (“Airgas”) a gas supply
company, entered into a contract with plaintiff-appellee DSWDWK, LLC, (“Impact”)
a commercial beverage bottler, to serve as the exclusive provider of Impact’s gas.
Impact also contracted with Airgas to rent a large storage tank to hold its monthly gas
deliveries. For years, Airgas supplied Impact with the gas it needed to bottle its clients’
carbonated beverages without incident. But, in its sixth year, the parties’ relationship
began to sour. Impact needed more gas than the parties’ contract contemplated, and
unforeseen events outside of Airgas’s control interrupted the supply of available
commercial gas. As a result, Impact quit paying Airgas’s bill and sourced its gas
elsewhere. When attempts to amicably resolve the dispute failed, Airgas padlocked its
storage tank and ultimately removed it from Impact’s property. Impact claimed the
loss of the tank severely limited its ability to fulfill outstanding orders from its largest
client, Carbliss.
{¶2} Impact sued Airgas for conversion, trespass to chattels, and tortious
interference with its Carbliss contract. In response, Airgas counterclaimed for breach
of contract. The trial court denied Airgas’s motion for summary judgment and tried
all claims to the bench. Following the trial, it ruled in favor of Impact on its three tort
claims and against Airgas on its counterclaim.
{¶3} Airgas now appeals, arguing that the trial court should have awarded
summary judgment in its favor under the economic loss rule. More specifically, Airgas
contends that Impact’s tort claims should have been raised as contract claims because
they originated from the parties’ contractual agreement rather than an independent
legal duty. Airgas also argues that the trial court erred in denying its breach of contract
claim on the basis of waiver. We agree with Airgas on both fronts. We accordingly
OHIO FIRST DISTRICT COURT OF APPEALS
reverse the trial court’s judgment and remand the matter for computation of damages.
Factual and Procedural History
{¶4} In July 2016, Impact and Airgas entered into a product sales agreement
(“PSA”) under which Airgas would supply Impact with gas to carbonate bottled
beverages. The PSA took effect in April of 2017. Initially lasting for a five-year term,
the PSA renewed annually if neither party cancelled six months before its expiration.
The parties agreed that the PSA was governed by Delaware rather than Ohio law.
{¶5} The PSA’s initial five-year term concluded in April of 2022 and renewed
for another year, as neither party canceled six months earlier. Under the key terms of
the PSA, Impact agreed to exclusively purchase all of its commercial gas from Airgas.
In turn, Airgas agreed to supply gas to Impact up to an estimated monthly amount. If
Impact required additional gas beyond the estimated amount, Airgas had the option,
but not the obligation, to provide the excess product.1 If Airgas failed to meet Impact’s
demand, the parties agreed that Impact would be limited to recovering the difference
in price between a substitute product and the product Airgas should have provided.2
{¶6} A rider attached to and incorporated by the PSA established the
estimated monthly volume of Impact’s gas as 10,000 to 12,000 pounds. The rider also
provided that Airgas would rent Impact a six-ton storage tank for a monthly rental fee
1 These terms were contained in Section 1 of the PSA, which provided:
Buyer shall buy from Seller Buyer’s present and future requirements of industrial
. . . gases . . . (“Products”), in suitable containers, . . . upon the terms and conditions
set forth in this Agreement, including, without limitations, any rider or
amendment to this Agreement. . . . In the event that Buyer’s requirements for any
of the Products should exceed the original estimated quantities under this
Agreement, Seller shall not be obligated, but shall have the right at its option, to
deliver Product that exceeds such original amount. . . .
2 To this end, Section 15 of the PSA provided:
Buyer’s exclusive remedy for the unexcused failure on the part of Seller to deliver
product when required by Buyer, regardless of cause of such failure, including
negligence, shall be to recover from Seller the difference between the cost to Buyer
of any reasonable purchase of Product in substitution for Product not delivered
and the lesser price of such quantity hereunder.
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OHIO FIRST DISTRICT COURT OF APPEALS
of $600. Under Section 8 of the PSA, Impact was required to permit Airgas to access
the tank at all times, and Airgas was required to maintain the tank and keep it in good
repair. Section 8 also provided that Impact “shall have no ownership interest” in the
tank. Under Section 10, Airgas had the right to remove the tank “within ninety (90)
days after the expiration or termination” of the PSA.
{¶7} During the spring of 2022, the relationship between Impact and Airgas
began to grow hostile. Impact initially claimed that Airgas undersupplied its gas and
that it was due a credit on its bill. Impact therefore withheld payment for Airgas’s
monthly gas deliveries. When it was not paid, Airgas eventually locked and then
repossessed the gas storage tank on Impact’s property. Impact alleged this caused
severe interruption to its ability to fulfill beverage production orders for its clients.
{¶8} On April 12, 2023, Impact sued Airgas. Relevant to this appeal are three
of Impact’s claims. First, Impact alleged that Airgas committed conversion by
engaging in “a wrongful act which impacted Impact’s dominion and control over the
Tanks and resulted in a disposition of Impact’s property rights.” Second, Impact
alleged that Airgas trespassed to its chattels through an “unauthorized and intentional
intrusive act which interfered with Impact’s right to exclusive possession of the
property.” Third, Impact alleged that Airgas tortiously interfered with its customer
contracts “[b]y intentionally altering and then removing the Tanks used by Impact to
store carbonated gas products [and] knowingly, consciously and intentionally
interfer[ing] with Impact’s ability to perform the aforesaid contract with third parties.”
{¶9} On June 23, 2023, Airgas counterclaimed for breach of contract,
alleging that Impact materially breached the PSA’s exclusivity clause and breached the
PSA by refusing to pay for the gas Airgas had supplied.
{¶10} The parties initially moved for judgment on the pleadings. Importantly,
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OHIO FIRST DISTRICT COURT OF APPEALS
Airgas’s motion raised an issue regarding the applicability of the economic loss rule,
which bars a party from pursuing tort claims for economic losses that arise purely from
a breach of contract. See Corporex Dev. & Constr. Mgt. v. Shook, Inc., 2005-Ohio5409, ¶ 6. The trial court concluded that, because the parties’ possessory interests
were uncertain at that time, “reasonable minds could differ” as to whether the
economic loss rule barred Impact’s complaint. It accordingly denied the motions.
{¶11} Following discovery, Airgas moved for summary judgment and repeated
the argument that Impact’s tort claims were barred by the economic loss rule. The
trial court again rejected Airgas’s position. Instead, the trial court found that three
issues of material fact precluded summary judgment: (1) “which party ha[d] a superior
interest in the tank and other equipment,” (2) “whether Impact was in default,” thus
allowing Airgas to repossess the tank pursuant to the PSA, and (3) regarding the
tortious interference claim specifically, “whether Airgas had a motive to interfere with
Impact’s business relations.”
{¶12} Impact’s claims and Airgas’s counterclaim were then tried to the bench.
The parties jointly submitted the PSA as a trial exhibit. Impact and Airgas each called
one witness.
{¶13} Whit Hesser, Impact’s chief executive officer (“CEO”), testified
regarding Impact’s business operations. According to Hesser, Impact operated a
canning plant which produced cartons of product for its customers. Impact’s largest
client was Carbliss, a producer of carbonated alcoholic beverages.
{¶14} Impact executed the PSA before Hesser became its CEO. Hesser
understood the PSA to obligate Impact to exclusively purchase its gas from Airgas and
to obligate Airgas to provide an estimated amount of 10,000 to 12,000 pounds of gas
per month to Impact. According to Hesser, Impact also leased a six-ton tank from
6
OHIO FIRST DISTRICT COURT OF APPEALS
Airgas, which Airgas was required to service.
{¶15} During the first four years of the PSA, Hesser believed that Airgas’s
service operated smoothly. But in the beginning of 2022, the tank began to run out of
gas. When this happened, Hesser contacted Chris Alles at Airgas, who explained that
the gas shortfall resulted from a labor shortage in the number of available drivers.
{¶16} According to Hesser, Impact had to shut down its plant when the tank
ran out of gas. These shortages occurred every 30 to 45 days in the early part of 2022,
and Impact had to close the plant for up to a day and a half. Hesser told Alles about
the shutdowns but never relayed the monetary losses Impact suffered as a result.
{¶17} Hesser then drafted a “credit memo,” which reflected Impact’s losses
from the periodic shutdowns. In the credit memo, Hesser claimed a credit towards
Impact’s future invoices from Airgas to offset its lost revenues from the empty gas
tank. Hesser’s first draft of the credit memo claimed a $33,750 credit. 3 Airgas never
acknowledged receipt of the initial credit memo.
{¶18} Hesser testified that, in June 2022, Impact sent a letter to Airgas
indicating its intent to cancel the PSA, along with a second credit memo claiming a
total of $66,000 in credit against Airgas’s invoices. On June 3, 2022, Airgas
acknowledged receipt of the cancellation but not the credit. In its acknowledgment,
Airgas took the position that the PSA had automatically renewed for one year in April
of 2022, since it had not been cancelled six months earlier. Therefore, according to
Airgas, the PSA remained in effect until April of 2023.
{¶19} According to Hesser, on August 30, 2022, Airgas notified Impact in
3 The credit memo contained an explanation of how the $33,750 credit was calculated. The equation included information on Impact’s per case profit margin and the number of cases it can produce per shift.
7
OHIO FIRST DISTRICT COURT OF APPEALS
writing of disruptions in the commercial gas market outside of its control that were
expected to last through October 2022. Airgas therefore invoked a force majeure
clause in the PSA, which allowed Impact to purchase gas from another company rather
than relying on Airgas as its exclusive supplier. Hesser testified that, once the force
majeure clause took effect, Impact began buying gas from Trade & Industrial
(“Trade”).
{¶20} Per Hesser’s testimony, Impact and Airgas met in late September or
early October 2022 to discuss their disputes, which at that point included Impact’s
credit memos and Airgas’s invocation of the force majeure clause. Following the
meeting, Airgas presented Impact with a settlement proposal. Airgas proposed that
Impact pay $60,546.97 towards its unpaid invoices, upon which Airgas would issue a
$10,000 credit. Impact rejected the offer on October 22, 2022.
{¶21} Hesser testified that two days later, on October 24, 2022, Airgas
responded that it would repossess its tank and look to settle the dispute differently.
Impact indicated that it did not consent to the tank being removed. Instead, Impact
notified Airgas that the tank was in need of repair, but, according to Hesser, Airgas
refused to fix it.
{¶22} As Hesser explained, Impact continued to purchase gas from Trade
through January 2023, because Airgas never provided notice that the force majeure
period was revoked. Around that same time, Airgas reminded Impact in writing of its
obligation to exclusively purchase its gas from Airgas. Although the letter referenced
the PSA’s exclusivity clause, Hesser did not interpret the communication as a
rescission of the force majeure clause.
{¶23} Hesser testified that Airgas disabled its tank on February 3, 2023, by
installing a lock. At the time, Impact was using smaller tanks supplied by Trade to
8
OHIO FIRST DISTRICT COURT OF APPEALS
store its gas, so the disruption did not shut down Impact’s business. Eventually Impact
ordered a 26-ton horizontal tank from Trade, much larger than the six-ton tank it had
leased from Airgas.
{¶24} In early March 2023, Airgas removed its tank from Impact’s property.
Hesser testified that Impact was not using the tank, so the repossession did not
materially change Impact’s operations. The plant was, however, negatively impacted
by Impact’s shift to smaller tanks, which happened before Airgas padlocked its tank.
As a result, Impact was unable to fulfill its contract with Carbliss as quickly as
expected.
{¶25} Hesser testified that, in March 2023, Carbliss decreased the number of
cases in its order, resulting in a loss of about $1.9 million in revenue to Impact. On
cross-examination, Hesser conceded that Impact entered into its contract with
Carbliss the same day that Airgas indicated it intended to repossess the tank.
{¶26} Hesser believed that Section 1 of the PSA required Airgas to supply an
unlimited amount of gas to Impact. Although the rider incorporated into the PSA set
the estimated monthly amount at 10,000 to 12,000 pounds, Hesser noted this was
only an estimate. Hesser acknowledged that, in April 2022, when the tank ran empty,
Impact had ordered 33,400 pounds of gas, which was almost triple the estimated
monthly amount. Hesser also acknowledged that the tank would not have been on
Impact’s property if not for the PSA.
{¶27} Hesser further admitted that Impact did not pay any of Airgas’s invoices
after April 22, 2022, nor did Impact pay the rental fee for the tank. Hesser agreed,
however, that, despite the lack of payment, in May 2022, Airgas supplied Impact with
29,000 pounds of gas, and in June 2022, Airgas supplied Impact with 37,000 pounds
of gas. Hesser further acknowledged that Airgas provided 30,000 pounds of gas in
9
OHIO FIRST DISTRICT COURT OF APPEALS
September 2022 and 24,000 pounds in October 2022, both months during the force
majeure period.
{¶28} Hesser testified that after October 2022, Impact no longer ordered gas
from Airgas but exclusively purchased gas from Trade. Even though this violated the
PSA’s exclusivity clause, Hesser believed that the PSA allowed Impact to instruct
Airgas not to remove its tank from Impact’s property. Hesser acknowledged, however,
that the PSA did not permit Impact to deduct its lost profits as a credit from the cost
of the gas.
{¶29} After Hesser testified, Impact rested.
{¶30} Airgas’s sole witness was Chris Alles, Airgas’s Cincinnati district
manager. Alles testified that, in April 2022, he met with Jared Hamilton, an
operations official with Impact, at Impact’s facility to discuss the alleged gas shortage.
During the meeting, Alles suggested that Impact increase the size of its tank from six
tons to 14, as Impact’s average gas usage had increased from the estimated 10,000 to
12,000 pounds to the upper 30,000s to low 40,000s pounds per month. According to
Alles, he provided Hamilton with information about a 14-ton tank, but Impact never
followed up.
{¶31} Alles also described the circumstances under which Airgas invoked the
PSA’s force majeure clause. According to Alles, a feedstock production issue in
Michigan temporarily disrupted Airgas’s gas supply. Despite Airgas’s invocation of
the force majeure provision, Airgas continued to supply Impact with 29,000 pounds
of gas each month.
{¶32} Alles testified that he received an invoice from Impact requesting that
Airgas pay the amount reflected in the credit memo. Alles declined this request
because he did not believe that Airgas owed Impact a credit. Impact then quit paying
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OHIO FIRST DISTRICT COURT OF APPEALS
its gas bills. According to Alles, Airgas did not provide Impact with any product after
October 2022 once Impact stopped paying.
{¶33} Alles agreed that the parties attempted to settle their disputes amicably.
At that time, according to Alles, Impact owed $60,546.97 in past-due fees for gas. As
part of the proposed settlement, Airgas offered Impact a $10,000 credit as goodwill.
Airgas also proposed terminating the PSA. But it agreed that Impact could continue
to use its tank for 60 days to allow Impact to locate another supplier.
{¶34} Alles testified that when negotiations broke down, and Impact still owed
the outstanding invoices, Airgas padlocked its tank. Shortly before this happened,
Alles spoke with Hesser to inform him that Airgas needed the tank for another
customer. According to Alles, Airgas also notified Impact of its intent to remove the
tank because Impact had not paid an invoice in eight months. Although Airgas
indicated it would remove the tank in ten days, the tank was not actually removed until
a couple of months later.
{¶35} Alles further testified about his communication with Hesser leading up
to the removal of the tank. Hesser told Alles that Impact still needed the tank but did
not confirm that Impact wanted to do business with Airgas. Instead, Hesser informed
Alles that Impact was still purchasing its gas from Trade, even though the force
majeure period had concluded. Alles later learned in February that Impact was also
using another company’s tank.
{¶36} Alles disclaimed knowledge that locking the tank would cause Impact’s
operations to come to a halt. Rather, Alles knew that Impact had on-site dewars—or
insulated cylinders—that were available as alternate storage mechanisms.
{¶37} Airgas rested after Alles testified.
{¶38} Nearly three months after the trial, the trial court issued its verdict in
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OHIO FIRST DISTRICT COURT OF APPEALS
written findings of facts and conclusions of law. As to Airgas’s argument that the
economic loss rule barred Impact’s tort claims, the trial court concluded that Airgas
had an independent duty, derived from common law, not to damage, transfer, or
interfere with Impact’s superior property right in the tank. Given these duties, which
existed outside of the parties’ contract, the trial court concluded that the economic loss
rule did not bar Impact’s tort claims. Regarding Impact’s conversion and trespass to
chattels claims, the trial court found that, during the term of the PSA, Impact had a
superior right to the tank. The trial court therefore concluded that Airgas converted
Impact’s property and trespassed as to its chattels by first disabling and then removing
the tank. Regarding Impact’s tortious interference claim, the trial court determined
that Airgas knew that failing to supply gas would cause Impact to suffer economic loss.
It therefore found Airgas liable for Impact’s losses due to its Carbliss contract. As to
Airgas’s counterclaim for breach of contract, the trial court concluded that both parties
breached the PSA—Airgas by undersupplying the tank in early 2022 and by failing to
repair it, and Impact by failing to pay Airgas and by obtaining gas from Trade. But it
concluded that Airgas waived Impact’s breaches by continuing to perform under the
PSA.
{¶39} The trial court accordingly issued judgment in favor of Impact on its
three claims and on Airgas’s counterclaim. It awarded Impact $1,932,768 in damages
for its losses on the Carbliss contract and $262,817 in damages for the disruption to
Impact’s production when the tank was locked.
{¶40} Airgas has appealed.
Analysis
{¶41} On appeal, Airgas raises two assignments of error. First, Airgas argues
that the trial court erred in denying its motion for summary judgment and in entering
12
OHIO FIRST DISTRICT COURT OF APPEALS
judgment in Impact’s favor on its claims for conversion, trespass to chattels, and
tortious interference. Second, Airgas argues that the trial court erred in entering
judgment in Impact’s favor on Airgas’s counterclaim. Both assignments of error are
meritorious.
A. Summary Judgment
{¶42} We begin with Airgas’s argument that the trial court should have
granted summary judgment in its favor, as it is dispositive of Airgas’s first assignment
of error.
{¶43} Summary judgment is proper under Civ.R. 56(C) where “(1) no genuine
issue of material fact remains, (2) the moving party is entitled to judgment as a matter
of law, and (3) it appears from the evidence that reasonable minds can come to but
one conclusion, and construing the evidence most strongly in favor of the nonmoving
party, that conclusion is adverse to the party against whom the motion for summary
judgment is made.” Civ.R. 56(C); Al Neyer, LLC v. Westfield Ins. Co., 2020-Ohio5417, ¶ 14 (1st Dist.). The moving party has the initial burden of demonstrating its
entitlement to summary judgment. Al Neyer at ¶ 15. “A moving party meets its initial
burden by informing the trial court of the basis for the motion and identifying the
portions of the record that demonstrate that there is an absence of evidence to support
the nonmoving party’s case.” B&T Business Ventures v. Disi Bros. Land, LLC, 2022-Ohio-2113, ¶ 12 (1st Dist.).
{¶44} Once the moving party has supported its summary judgment motion
with proper evidence, the nonmoving party “may not rest upon the mere allegations
or denials of the party’s pleadings.” Civ.R. 56(E). Instead, the nonmoving party “must
set forth specific facts showing that there is a genuine issue for trial.” Id. If the
nonmoving party fails to respond or to support its response with appropriate summary
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OHIO FIRST DISTRICT COURT OF APPEALS
judgment evidence, the trial court may grant summary judgment. McCoy v. Usuani,
2009-Ohio-3095, ¶ 10 (1st Dist.), citing Civ.R. 56.
{¶45} An appellate court generally reviews a trial court’s ruling on a motion
for summary judgment de novo. Travelers Prop. Cas. Corp. v. Chiquita Brands
Internatl., Inc., 2024-Ohio-1775, ¶ 17 (1st Dist.). This standard applies even if the
unsuccessful movant ultimately loses at trial. See Balson v. Dodds, 62 Ohio St.2d 287
(1980), paragraph one of the syllabus. Although errors in the denial of a summary
judgment motion that are factual in nature will often be rendered moot when the trial
proceedings show that a genuine issue of material fact supported denying the motion,
the denial of a summary judgment motion is not harmless when the denial was
predicated on a pure question of law. Bliss v. Manville, 2022-Ohio-4366, ¶ 14.
1. The Economic Loss Rule
{¶46} Airgas contends that the trial court erred in failing to apply the
economic loss rule to Impact’s tort claims. We agree.
{¶47} As explained by the Ohio Supreme Court, the economic loss rule
prevents “the tortification of contract law.” Motorists Mut. Ins. Co. v. Ironics, Inc.,
2022-Ohio-841, ¶ 28. “Under the economic loss doctrine, a party cannot recover
purely economic damages in a tort action against another party based upon the breach
of contractually created duties.” (Cleaned up.) KSMAC Holdings, Ltd. v. Ice Zone
Realty, Ltd, 2022-Ohio-1456, ¶ 55 (7th Dist.). In other words, a breach of contract
claim cannot create a tort claim. Plus Mgt. Servs. v. Liberty Healthcare Corp., 2024-Ohio-3127, ¶ 26 (2d Dist.). Thus, a plaintiff cannot sue for a tort claim that is based
on the same underlying conduct as a contractual claim “unless the defendant also
breached a duty that was owed independently of the contractual duties.” KSMAC at ¶
56.
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OHIO FIRST DISTRICT COURT OF APPEALS
{¶48} Some courts, including this court, have suggested that the economic loss
rule generally does not apply to intentional torts. See, e.g., Momentum Freight
Logistics Corp. v. Benie Logistics, Inc., 2025-Ohio-5738, ¶ 68 (10th Dist.); Eysoldt v.
Proscan Imaging, 2011-Ohio-2359, ¶ 21 (1st Dist.). This is so because “intentional
torts necessarily involve duties beyond those created by contract.” Momentum
Freight Logistics Corp. at ¶ 68.
{¶49} Yet, despite this authority, courts have routinely held that intentional
tort claims can be barred by the existence of a contract. For example, in Plus Mgt.
Servs. at ¶ 26, the court noted that “even in cases involving intentional torts, a mere
breach of contract does not create a tort claim.” Rather, for an intentional tort claim
and a contract claim to coexist, the breaching party must owe a duty even in the
absence of the parties’ contractual relationship, and the intentional tort must involve
damages that are separate and distinct from the breach of contract. Id. at ¶ 26-27.
{¶50} This court follows a similar analysis. Recently, in Vandemark v. Reder,
2026-Ohio-50, ¶ 43-44 (1st Dist.), we held that two criteria govern the inquiry into
whether an intentional tort claim can stand alone in light of the parties’ contractual
relationship: “(1) whether the defendant owed a legal duty to the plaintiff, [and] (2)
whether that duty was created or governed by the terms of a valid contract.” Id. at ¶
44.
{¶51} The general principle that the economic loss rule does not apply to
intentional torts therefore appears to be just that—a generalization. Courts are not
precluded from analyzing whether the defendant owed the plaintiff an independent
duty, separate from the parties’ contractual relationship, for the purpose of
determining the applicability of the economic loss rule merely because the plaintiff
sues for an intentional tort. Rather, as we held in Vandemark, when the plaintiff raises
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OHIO FIRST DISTRICT COURT OF APPEALS
a claim for an intentional tort, and the defendant asserts that the claim is barred by
the economic loss rule, the appropriate analysis is to determine the source of the
defendant’s duty. Vandemark at ¶ 43-44. We conduct that analysis now.
2. Conversion and Trespass to Chattels
{¶52} Impact sued Airgas for conversion and trespass to chattels. Conversion
and trespass to chattels require proof of ownership or a possessory interest in the
affected property. See Bruns v. Adlard, 2025-Ohio-5202, ¶ 20 (1st Dist.) (conversion);
Mathews v. Cooper, 2021-Ohio-2768, ¶ 45 (8th Dist.) (trespass to chattels). Impact
claims it was entitled to possess and use the gas storage tank because it rented the tank
from Airgas as a term of the PSA.
{¶53} Because Impact’s claim to possession derives from the PSA, there is no
other way to view these claims but as contractual. Focusing on the first prong of the
Vandemark test, Airgas had no duty to provide a gas storage tank to Impact other than
the one it contractually agreed to in the PSA. And Impact had no right to possess the
gas storage tank outside of the one it bargained and paid for by virtue of its contract
with Airgas.
{¶54} Turning to the second prong of Vandemark, the parties’ relationship
with regard to the tank was entirely governed by the PSA. The rider, which was
incorporated into the PSA, outlined that Impact would rent a six-ton tank from Airgas
for a rental fee of $600 per month. Section 8 of the PSA required Impact to make the
tank available to Airgas at all times for servicing. Section 10 provided that Airgas could
repossess the tank within 90 days of the agreement’s termination. Section 8 also
disclaimed any ownership interest in the tank on Impact’s part. The specificity of these
provisions demonstrates that the parties reached a negotiated agreement as to what
their respective duties regarding the tank would be.
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OHIO FIRST DISTRICT COURT OF APPEALS
{¶55} Given the lack of an independent duty outside the PSA, Impact’s
conversion and trespass to chattels claims are therefore contract claims barred by the
economic loss rule.
{¶56} This conclusion is fully consistent with three recent decisions from
other Ohio courts. First, in Plus Mgt. Servs., 2024-Ohio-3127, at ¶ 30 (2d Dist.), the
Second District barred a plaintiff from suing for conversion for conduct that essentially
amounted to a breach of contract. At issue in Plus Mgt. Servs. was a dispute between
the seller and purchaser of a nursing home over capital expenditures and management
fees. Id. at ¶ 4-8. A jury found in favor of the seller on its conversion claim, awarding
it over $800,000 in damages. Id. at ¶ 11. On appeal, the buyer argued that the seller’s
claim for conversion was barred by the economic loss rule. Id. at ¶ 23. Rejecting the
seller’s argument that its conversion claim rested on the independent duty not to
commit an intentional tort, the Second District agreed. Id. at ¶ 28. If such a duty
existed, the court reasoned, the distinction between tort and contract claims would be
meaningless, as a general duty to refrain from intentional torts exists in every case. Id.
Rather, the court focused on the source of the buyer’s duty. Because the buyer’s
obligation to limit capital expenditures was “grounded in the parties’ contracts,” and
because “[r]esolution of this issue turned on the parties’ contractual duties,” the court
set aside the jury’s conversion verdict. Id. at ¶ 29-30.
{¶57} The Seventh District reached a similar outcome in KSMAC Holdings,
2022-Ohio-1456 (7th Dist.). There, KSMAC entered into a five-year lease agreement
with Ice Realty to rent space for a trampoline park. Id. at ¶ 2. The contract contained
a purchase option, which KSMAC eventually exercised. Id. at ¶ 2-3. The parties
negotiated and entered into an agreement for the sale of the property, including sports
equipment and fixtures, under which KSMAC agreed to assume Ice Realty’s other
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OHIO FIRST DISTRICT COURT OF APPEALS
obligations, including an elevator service contract and existing skating contracts. Id.
at ¶ 3-4. After the contract was signed, but prior to closing, Ice Realty removed all of
its personal items from the building. Id. at ¶ 5. Then, after closing, KSMAC noticed
that the ice floor in the building was melting due to a lack of refrigerant. Id. at ¶ 6.
KSMAC demanded that Ice Realty return the refrigerant so it could refreeze the floor,
but Ice Realty refused, arguing that it constituted personal property not intended for
sale. Id.
{¶58} KSMAC sued Ice Realty for breach of contract, promissory estoppel,
unjust enrichment, civil theft, conversion, fraud, and negligent misrepresentation, and
sought to pierce the corporate veil. Id. at ¶ 7. Ice Realty moved for summary judgment
on the civil theft, conversion, and fraud claims, arguing that they were barred by the
economic loss rule. Id. at ¶ 8. KSMAC opposed the motion on the ground that removal
of the refrigerant physically damaged the facility, causing economic loss outside of the
parties’ contract. Id. at ¶ 9. KSMAC also filed its own summary judgment motion,
arguing that refrigerant was included in the term “chilling equipment” and was
therefore required to be sold under the parties’ contract. Id. The trial court agreed
with Ice Realty. Id.
{¶59} On appeal, KSMAC challenged the trial court’s application of the
economic loss rule to its conversion claim. Id. at ¶ 59. But the Seventh District agreed
with the trial court that KSMAC’s conversion claim had no independent source of duty
outside of the parties’ contract. Id. at ¶ 56. It accordingly affirmed the trial court’s
decision to award summary judgment to Ice Realty. Id. at ¶ 59.
{¶60} Most recently, the Third District barred a conversion claim under the
economic loss rule in Rena Lyon Revocable Trust v. Berry, 2026-Ohio-2369, ¶ 35 (3d
Dist.). Because the plaintiff’s claim as to the storage and disposition of her personal
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OHIO FIRST DISTRICT COURT OF APPEALS
property arose from a residential purchase agreement, the court held that it was
“functionally indistinguishable” from her breach of contract claim. Id. at ¶ 33.
{¶61} As Plus Mgt. Servs., KSMAC, and Rena Lyon make clear, the existence
of a contract governing the parties’ disposition of property forecloses a party’s
conversion claim regarding that property when it relies on no independent duty
outside the contract. That is the case with regard to Impact’s conversion claim here.
It is also the case with regard to Impact’s trespass to chattels claim, which is essentially
redundant to its conversion claim. As in Plus Mgt. Servs., the trial court erred in
identifying the generalized duty not to commit an intentional tort as the source of
Airgas’s independent duty. Such a duty always exists and is insufficient to support a
separate tort claim when a party is obligated by a more specific contractual
responsibility.
{¶62} Before concluding, we address one final point raised by Impact. Impact
suggests that the absence of breach of contract claims in its complaint has bearing on
our analysis. It argues that we cannot apply the economic loss rule to bar its tort claims
when it has no breach of contract claims to fall back on. We reject this contention. If
a party could avoid the application of the economic loss rule merely by failing to plead
breach of contract claims, we would be inviting gamesmanship in pleading. See, e.g.,
State ex rel. Hignight v. Knepp, 2024-Ohio-1708, ¶ 20 (interpreting legal principles
to disfavor “cynical gamesmanship”). Moreover, there is nothing to prohibit a party
from pleading alternative contract and tort claims, provided that the facts and the law
support doing so. See Rena Lyon at ¶ 29.
{¶63} Impact’s conversion and trespass to chattels claims rely on no duty
outside of Airgas’s contractual one. They are accordingly barred by the economic loss
rule. The trial court therefore erred in denying Airgas’s motion for summary judgment
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OHIO FIRST DISTRICT COURT OF APPEALS
on these claims.
3. Tortious Interference with Contract
{¶64} Airgas next argues that the trial court erred in denying its motion for
summary judgment on Impact’s tortious interference claim.
{¶65} “A party is liable for tortious interference with contract if the party
intentionally and improperly interferes with the performance of a contract between
another and a third person by inducing the third person not to perform the contract,
thus causing damage.” Innovative Architectural Planners, Inc. v. Ohio Dept. of Adm.
Servs., 2024-Ohio-824, ¶ 21 (10th Dist.). To establish a tortious interference with
contract claim, one must show “(1) the existence of a contract, (2) the wrongdoer’s
knowledge of the contract, (3) the wrongdoer’s intentional procurement of the
contract’s breach, (4) lack of justification, and (5) resulting damages.” Columbia Dev.
Corp. v. Krohn, 2014-Ohio-5607, ¶ 18 (1st Dist.).
{¶66} To meet these elements, Impact argued that Airgas intentionally and
knowingly interfered with its Carbliss contract by locking and then repossessing the
gas storage tank, which resulted in slowdowns to Impact’s production line, reductions
in Carbliss’s beverage orders, and ultimately lost profits to Impact. As with Impact’s
conversion and trespass to chattels claims, Impact contended that Airgas owed a duty
under the PSA to leave the tank in place through the term of the PSA.
{¶67} But like Impact’s conversion and trespass to chattels claims, this claim
relies on no independent duty outside of the parties’ contract. Even if we agree under
the first Vandemark factor that Airgas owed Impact a duty under the PSA, the source
of any duty Airgas may have owed Impact with regard to the tank originated entirely
from the contract. In other words, the intentional interference with a contract that
Impact alleges Airgas caused amounted to nothing more than Airgas’s alleged breach
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OHIO FIRST DISTRICT COURT OF APPEALS
of the parties’ tank rental agreement. This claim therefore draws its source entirely
from the PSA.
{¶68} In arguing otherwise, Impact suggests that the economic loss it
suffered—lost profits from its Carbliss contract—fell outside the damages it could
recoup under the PSA. This is true. Section 15 of the PSA limits Impact to cover
damages and not lost profits in the event Airgas breaches its contractual obligations.
But the fact that tort law might provide more generous recovery than the parties’
bargained-for agreement is not a basis for excusing the application of the economic
loss rule. See Motorists Mut. Ins. Co. v. Ironics, Inc., 2022-Ohio-841, ¶ 28. Had
Impact wanted to recover lost profits for a breach of contract, its remedy was to
negotiate for such a term in its contract, not to sue for an intentional tort premised on
Airgas’s breach.
{¶69} Airgas’s first assignment of error is sustained. The trial court erred in
denying Airgas’s summary judgment motion on the basis of the economic loss rule.
We accordingly reverse the trial court’s judgment in Impact’s favor as to its claims for
conversion, trespass to chattels, and tortious interference.
B. Breach of Contract
{¶70} In its second assignment of error, Airgas challenges the trial court’s
verdict on its breach of contract counterclaim. In resolving the counterclaim in
Impact’s favor, the trial court concluded that Impact breached the PSA by failing to
pay for the gas Airgas delivered and by sourcing its gas from Trade despite its
exclusivity agreement with Airgas. But it concluded that Airgas waived these breaches
and thereby forfeited its ability to sue by continuing to perform its obligations under
the parties’ agreement.
{¶71} We review a trial court’s judgment following a bench trial in a civil case
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OHIO FIRST DISTRICT COURT OF APPEALS
under a blended standard of review. Under that standard, a trial court’s findings of
fact are entitled to a presumption of correctness, particularly given that the trial court
had the opportunity to observe the witnesses and assess their credibility. Toelke v.
Williams, 2025-Ohio-5032, ¶ 11 (1st Dist.). However, we review a trial court’s
determination of questions of law de novo. McIntyre v. Landscape Mgt. & Design,
2026-Ohio-1560, ¶ 14 (8th Dist.).
{¶72} In resolving Airgas’s breach of contract counterclaim, the trial court
made a number of factual findings regarding Airgas’s performance under the PSA. As
no party has challenged these findings, we presume they are correct. After Impact
stopped paying its invoices, Airgas communicated its intent to continue supplying gas
as part of its settlement negotiations. In those conversations, Airgas repeatedly
acknowledged that the PSA was in effect through April 2023, as neither party had
terminated it six months before it renewed in 2022. Airgas also reminded Impact of
its obligation to exclusively purchase gas from it and demanded that Impact stop doing
business with Trade as required by the PSA.
{¶73} The legal question we must answer is whether these actions waived
Impact’s breaches or whether Airgas was still entitled to collect its damages despite
continuing to perform under the PSA. If this question is governed by the PSA itself, it
must be resolved under Delaware law, as the PSA contains a choice-of-law clause
designating Delaware as the controlling state in the event there is a dispute about the
meaning or application of the PSA. See Schulke Radio Prods., Ltd. v. Midwestern
Broadcasting Co., 6 Ohio St.3d 436 (1983), syllabus (holding that choice-of-law
provisions in contracts are generally enforceable). But if the question is one of
procedure rather than substantive law, Ohio law dictates the answer. See Petroff v.
HDV Cleveland LLC, 2025-Ohio-4672, ¶ 12 (8th Dist.).
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OHIO FIRST DISTRICT COURT OF APPEALS
{¶74} We need not determine whether waiver is a procedural or substantive
question, or whether Delaware or Ohio law controls the inquiry, as both states
approach the topic of waiver in a substantially similar way. Under the laws of both
states, a nonbreaching party may still recover damages for a breach of contract despite
continuing to perform. See, e.g., AB Stable VIII LLC v. Maps Hotels & Resorts One
LLC, 2020 Del. Ch. LEXIS 353, *270 (Del. Ch. Nov. 30, 2020); Meyer v. Chieffo, 2011-Ohio-1670, ¶ 32 (10th Dist.). This has been described as an “elementary rule of
contracts.” Meyer at ¶ 32, citing Bryan Pub. Co. v. Kuser, 2008-Ohio-2610, ¶ 18 (3d
Dist.); see Jack Turturici Family Trust v. Carey, 2012-Ohio-6191, ¶ 50 (2d Dist.).
When confronted with a breach of contract, a nonbreaching party has two options.
Macrophage Therapeutics, Inc. v. Goldberg, 2021 Del. Ch. LEXIS 127 (Del. Ch. June
23, 2021). It can either terminate the contract and sue for total breach, or it can
continue the contract and sue for partial breach. Id. Choosing the latter option does
not waive the nonbreaching party’s right to obtain damages for the partial breach. AB
Stable at *270. But it does waive the nonbreaching party’s ability to argue that the
breach discharged its obligation to perform. Id. In other words, the nonbreaching
party can “keep the contract alive for the benefit of both parties, being at all times . . .
ready and able to perform,” and still sue to recover damages under the contract. Burke
& Assoc. v. Koinonia Homes, 135 Ohio App.3d 683, 687 (8th Dist. 1999).
{¶75} Given these principles, the trial court was incorrect as a matter of law in
determining that Airgas waived Impact’s breaches by continuing to perform under the
PSA. Nothing prohibited Airgas from seeking to recoup its unpaid invoices while
continuing to provide Impact with gas. Holding otherwise would amount to a
determination that Impact was entitled to free gas simply because Airgas continued to
meet its monthly demand once Impact stopped paying. But this is not what the parties
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OHIO FIRST DISTRICT COURT OF APPEALS
agreed to. At most, the parties agreed in Section 15 of the PSA that Impact was entitled
to cover damages—e.g., the difference in price between replacement gas and the gas
Airgas should have supplied—in the event of a shortage.
{¶76} We accordingly sustain Airgas’s second assignment of error and reverse
the judgment of the trial court in Impact’s favor on Airgas’s counterclaim, as Airgas
did not waive Impact’s breaches as a matter of law. Neither party has challenged the
trial court’s determination that Impact breached the PSA by failing to pay Airgas’s
invoices and by violating the PSA’s exclusivity clause. We accordingly remand the
cause to the trial court to enter judgment in Airgas’s favor on the breach of contract
counterclaim and to determine the amount of damages to which Airgas is entitled.
Conclusion
{¶77} Impact’s claims for conversion, trespass to chattels, and tortious
interference were barred by the economic loss rule, as they relied on no independent
duty outside of the parties’ contract. The trial court therefore erred in failing to apply
the economic loss rule and should have awarded summary judgment in Airgas’s favor.
Similarly, Airgas prevailed on its counterclaim for breach of contract, which it did not
waive by continuing to perform under the contract. We accordingly sustain Airgas’s
assignments of error, reverse the judgment of the trial court, and remand the cause for
a determination of damages on Airgas’s counterclaim.
Judgment reversed and cause remanded.
CROUSE and BOCK, JJ., concur.
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