In the

United States Court of Appeals

For the Seventh Circuit ____________________

No. 17-1893

EMIRAT AG,

Plaintiff-Appellant,

v.

WS PACKAGING GROUP, INC.,

Defendant-Appellee.

____________________

Appeal from the United States District Court

for the Eastern District of Wisconsin.

No. 12-C-0789 — C.N. Clevert, Jr., Judge.

____________________

ARGUED OCTOBER 24, 2017 — DECIDED AUGUST 21, 2018

____________________

Before EASTERBROOK, ROVNER, and HAMILTON, Circuit 

Judges.

EASTERBROOK, Circuit Judge. Sabafon, a telephone company based in Yemen, wanted to buy cards that would provide 

its customers with prepaid minutes of phone use. To make 

these cards more attractive, Sabafon wanted to add a game 

of chance. Both the number that would supply phone time 

and the symbols representing prizes were to be covered by a 

scratch-off coating. (An opaque coating prevents the num-
2 No. 17-1893

bers and symbols from being discovered before the cards are

sold, and it also prevents buyers from knowing in advance 

which parts of the card contain the winning boxes.) Emirat, a 

German firm in the risk-management business, promised to 

supply Sabafon with 25 million high-security scratch-off 

cards. Emirat contracted with High Point Printing LLC of 

Ohio to print the cards, and High Point in turn engaged WS 

Packaging of Wisconsin to do the work.

Emirat paid High Point about $700,000, and in this suit

under Wisconsin law it demands that much in damages—

not from High Point, which is defunct, but from WS Packaging. Emirat did not have a contract with WS Packaging,

whose deal was with High Point. Still, Emirat contends that 

a settlement agreement it reached directly with WS Packaging after an initial run of cards was not shipped in numerical 

order, 500 pieces to a tray, subjects WS Packaging to all 

terms of the contract between Emirat and High Point. The 

district court thought otherwise and granted summary 

judgment to WS Packaging. 248 F. Supp. 3d 911 (E.D. Wis. 

2017). To simplify this decision, we assume that WS Packaging is indeed obliged to perform up to the standards that 

High Point promised Emirat. But what are those standards?

First we need to explain why Emirat refused to accept the 

cards. A scratch-off covering is supposed to prevent the 

reading of phone codes or game symbols through a process 

known as candling—shining a bright light behind the cards

to reveal the printing under the opaque coating. With a goal 

of zero candling, WS Packaging tested its print runs using 

high-intensity light and did not find a problem. Emirat 

wanted extra assurance and sent samples of the cards to 

Force Technology in Denmark. Following protocols pre-
No. 17-1893 3

scribed by Emirat, Force Technology tried to read the printing using light from the sun, fluorescent tubes, infrared 

(thermal), x-rays, and lasers. It reported that “it is not possible—with the techniques used—to disclose the symbols underneath the scratch layer.”

That was June 2009. In October 2009 Emirat sent Force 

Technology more samples. It used the same tests and 

reached the same result: “based on the cards received and 

the tests done on the cards, ... the symbols can not be disclosed and the security of the scratch card ... is good.” But 

Sabafon insisted that some cards could be candled by removing them from their plastic overwrap and bending them 

until the scratch-off layer cracked, then shining a bright light 

from behind. Emirat sent a third batch of cards to Force 

Technology with instructions to bend the cards around a 

pencil, crack the coating, and find out what could be seen. In 

December 2009 Force Technology reported that it was able to 

see some digits and game symbols using this technique. 

Emirat rejected the whole print run and demanded its money back, but by then High Point was out of business.

Emirat insists that zero candling is the only acceptable 

level. By that standard, however, no scratch-off card is secure. With a sufficiently high-tech approach (think CT scanners or muon tomography), or sufficiently clever manipulation, any security can be compromised. But no one will 

spend $1,000 to break the security of a card promising $50 

worth of phone time. Security suffices if it prevents practical

kinds of cheating. A trade association called the World Lottery Association has defined what this means: a scratch-off 

card is a security risk only if it can be candled in five 

minutes or less. This is the norm from which contractual ne-
4 No. 17-1893

gotiations can begin. A buyer that wants more security—

resisting candling for 10 minutes, 20 minutes, an hour, or 

forever—can contract for it. But Emirat did not do so. It 

promised “high level” security (an undefined phrase) to 

Sabafon, but its contracts with High Point and WS Packaging 

are silent on candling. Our assumption that WS Packaging 

assumed all of High Point’s promises still leaves silence.

In this suit Emirat presented the evidence of two experts, 

James Blanco and Larry Stewart, who bent the cards, cracked 

the coating, and then tried to read the printing. Blanco reported that it took him 13 or 14 hours to learn how to bend a 

card without doing so much damage to the coating that the 

tampering could be detected. After acquiring this skill, he 

stated, he could read all digits of the phone code and some 

prize symbols on some cards. (“Some” prize symbols would 

not have been enough. To win a prize the customer had to 

scratch the coating off exactly six areas, which had to contain 

the same prize. Each card had six identical prize symbols 

and 18 different prize symbols, so unless close to all of the 

symbols could be read it would not be possible to choose the 

six winning areas to scratch off.) Stewart testified at a deposition that after bending and cracking cards he could decipher some of the digits in the phone code but that he did not 

see all of the digits in any code, because “[t]hat would take 

many more hours than I was provided here.”

Both Blanco and Stewart conceded that the cards were 

not security risks under the World Lottery Association’s 

five-minutes-per-card standard. That is dispositive against 

Emirat, for neither High Point nor WS Packaging promised 

any higher level of security. (WS Packaging’s internal goal of 

zero candling was not a promise to Emirat.)
No. 17-1893 5

We might imagine an argument that the World Lottery 

Association is a tool of the printing industry and that its fiveminute standard is not the norm from customers’ perspectives. But Emirat does not make such an argument; the Association’s principal members are lottery-running governments—volume buyers of scratch-off cards. Nor does Emirat

contend that usages of trade supply a norm that cards must 

be more candling-resistant than the five-minute standard. It 

has presented evidence that participants in the industry expect to receive cards that do not candle. What it has not presented is evidence that “do not candle” has a shared meaning different from the trade association’s standard. One of 

Emirat’s witnesses testified that cards are candle-proof if a 

high-intensity light does not reveal what is under the coating. WS Packaging’s cards passed that test repeatedly. This 

witness did not mention bending cards to crack the coating 

as a norm in the industry. Other witnesses, including Blanco 

and Stewart, testified to different approaches. Force Technology did not think to bend the cards until Emirat told it to 

do so. Multiple witnesses testified that cards’ security—more 

valuable cards need extra security—normally is specified by 

contract. This implies that there is no off-the-rack standard, 

no usage of trade read into every contract, requiring more 

than the trade association’s five-minute standard.

The district court treated the contract as too ambiguous 

to make the “how secure?” subject appropriate for summary 

judgment. But the contract is not ambiguous. It is silent. It 

does not promise Emirat any level of security, except 

through the possibility that usages of trade are read into 

every contract for scratch-off cards. And Emirat has not produced evidence—has not even argued—that there is any us-
6 No. 17-1893

age of trade, except perhaps the World Lottery Association’s 

five-minute standard.

Because this record does not contain evidence from 

which a reasonable jury could conclude that WS Packaging 

promised to supply cards more secure than the World Lottery Association’s norm, and because Emirat’s own expert 

witnesses conceded that these cards could not be candled in 

less than five minutes, the judgment of the district court is

AFFIRMED.