MEMORANDUM AND ORDER
Litex, Inc. ("Litex") attempts here to assert tort claimsagainst Delphi Corporation ("Delphi") in alleged contravention ofan earlier settlement agreement reached between the parties.Litex seeks to avoid the terms of the agreement by arguing thatits assent was induced by Delphi's fraud. Delphi seeks adeclaratory judgment that the parties' agreement bars Litex'sclaims as matter of law. Each party has moved for summaryjudgment against the other as to whether the settlement agreementis enforceable. A. Factual Background
In 1994, Delphi, an automotive products company, beganresearching the science of non-thermal plasma ("NTP") as apotential treating agent for automotive exhaust pollutants.Statement of Undisputed Material Facts in Supp. of Delphi Corp.'sMot. for Summ. J. ("Pl.'s Facts") [Doc. No. 13] ¶¶ 1, 4. Delphi'sresearch concentrated on combining NTP with a catalyst to removenitrogen oxide pollutants from diesel engine exhaust. Id. at ¶2. To make the technology commercially feasible, Delphi set threetarget goals for the project. Id. at ¶ 3 (citations omitted).According to Delphi, those goals were: (1) "90% reductionefficiency of nitrogen oxide in diesel exhaust", (2) a less than3% "fuel penalty" to operate NTP on a vehicle, and (3) a low-costcommercial product. Id. As Litex points out, however, Delphiset additional goals. Litex's Resp. to Delphi Corp.'s Statementof Undisputed Material Facts, and Litex's Statement of UndisputedMaterial Facts in Supp. of Litex's Cross-Mot. for Partial Summ.J. ("Def.'s Facts") [Doc. No. 18] at 1, ¶ 3. A "much lowerefficiency value," Litex notes, was required to meet those goals.Id.
In 1999 and 2000, Delphi had achieved laboratory resultssuggesting that NTP could be a viable diesel exhaust treatmentsolution. Pl.'s Facts ¶ 4. Delphi subsequently issued press releases in connection with its NTP research and applied forawards in industry research. Id. at ¶ 5. In 2001, however,Delphi began experiencing problems with "on-vehicle testing ofits NTP project." Pl.'s Facts ¶ 6. According to Delphi, the"vehicle tests resulted in less that 15% [nitrogen oxide]reduction and a fuel penalty of 8%, results far shy of its goaland its earlier laboratory results." Id. Litex notes, however,that these results were "not `far shy'" of Delphi's other statedgoals. Def.'s Facts at 2, ¶ 6.
By 2001, Delphi's management had become aware of the"diminishing success of the NTP project." Pl.'s Facts ¶ 9. In May2001, Litex commenced an action in the United States DistrictCourt for the District of Massachusetts, asserting claims againstDelphi for infringement of its NTP patents. This civil action wasrandomly drawn to the Hon. Joseph L. Tauro. Litex's Mem. in Opp'nto Pl.'s Mot. for Summ. J. and in Supp. of Litex's Cross-Mot. forPartial Summ. J. ("Def.'s Mem.") [Doc. No. 16] at 2. By July2001, because of the poor performance of its NTP project, Delphi"was not confident about the success or commercial viability ofits NTP research." Pl.'s Facts ¶ 10.
From the summer of 2001 until March of 2002, Delphi continuedefforts to improve its NTP project. Pl.'s Facts ¶ 14. By 2002,Delphi had reduced the number of engineers working on the NTPproject from 25 to 12 or 13. Id. at ¶ 7. Delphi claims that italso cut its NTP research budget in half "compared to the level of funding budgeted for the NTP project in 1998." Id. at ¶ 8.According to Litex, however, the "actual funds for NTP remainedconstant between and including 1999 and 2002." Def.'s Facts at 2,¶ 8.
In April of 2002, Judge Tauro issued a discovery order in thepatent infringement lawsuit requiring that parties producerelevant documents relating to liability and damages and thatthey provide certain depositions. Pl.'s Facts ¶ 19. That samemonth, "Delphi abandoned research efforts on NTP catalysts."Id. at ¶ 15. Unable to commercialize an NTP product, "[in]September 2002, Delphi abandoned its entire NTP project." Id.at ¶ 16.
On November 23, 2003, a jury trial of the patent infringementcase commenced before Judge Tauro. Id. at ¶ 33. After the fifthday of trial and the recusal of Judge Tauro,1 Delphi andLitex settled their dispute and dismissed the case "with prejudice in favor of a private and confidentialarbitration in accordance with the terms of the Settlement TermSheet & Release." Id. at ¶ 34. According to the settlementagreement, Litex granted Delphi the following release: In consideration of the Settlement Term Sheet executed by the Parties on November 11, 2003, Litex hereby completely RELEASES, ACQUITS AND FOREVER DISCHARGES Delphi . . . and any and all other persons or entities acting in their behalf from any and all claims, demands, obligations, actions, liabilities or causes of action, under the patent laws, in tort, or otherwise in any jurisdiction including the claims for patent infringement in the Lawsuit, known or unknown, anticipated or unanticipated, regardless of whether such could have or could not have been brought in the Lawsuit, whether legal or equitable in nature and damages related to such any and all claims, demands, obligations, actions, liabilities or causes of action. . . . Such release shall not extend to future actions, including acts of alleged patent infringement.Id. at ¶ 38.2
In April 2004, Roderick McKelvie, Esq., a former United StatesDistrict Judge in the District of Delaware extremely experiencedin the trial of patent cases, presided over the arbitrationproceedings between the parties. Id. at ¶ 44. On September 7,2004, the arbitrator issued his decision and awarded Litexdamages and interest. Id. at ¶ 45. Delphi subsequently paid,and Litex accepted, the award. Id. at ¶ 46. On March 1, 2005,Litex served Delphi written notice of "its intention to sueDelphi in tort for intentional and negligent interference with prospective business relations, fraud, negligentmisrepresentation, trade libel, and unfair competition." Id. at¶ 47. Pursuant to 28 U.S.C § 2201, Delphi commenced thisdeclaratory judgment action on March 4, 2005, seeking enforcementof the parties' settlement agreement which bars Litex fromasserting its proposed tort claims. Id. at ¶ 48.
On April 29, 2005, Litex answered Delphi's Complaint andasserted the following four counterclaims: (1) declaratoryjudgment that the parties' settlement agreement does not barLitex's counterclaims due to Delphi's fraud; (2) intentionalinterference with prospective economic relations under Californialaw; (3) negligent interference with prospective economicrelations under California law; and (4) unfair competition underCalifornia law. Def.'s Answer [Doc. No. 8] ¶¶ 48-70.
In support of its declaratory judgment counterclaim, Litexalleges that Delphi fraudulently induced its execution of thesettlement agreement because: (1) Delphi failed to disclose thealleged falsity of its various 2001 press releases and 2001annual report, Def.'s Answer ¶¶ 48-54; (2) Delphi continuedthroughout 2001 and into 2002 to inform Litex and the public thatDelphi was progressing with its development and commercializationof an NTP product, id. at ¶¶ 6, 29; and (3) Delphi did notreveal to Litex until the arbitration proceedings in April 2004that, by 2001, it lacked confidence in its NTP research anddevelopment efforts and had serious doubts as to the future of its NTPproject. Id. at ¶¶ 7, 39, 40, 42.
1. Delphi's Allegedly Fraudulent Statements
Litex observes that on July 20, 2001, Delphi formulated thefollowing "spokesperson's statement" responding to potentialpublic inquires regarding Litex's patent infringement claimsagainst Delphi: We are excited, however, to discuss our technology. Delphi is developing non-thermal plasma catalysis components and systems relying upon its significant technical capabilities and sound, demonstrable and credible scientific principles.Delphi Corp.'s Resp. to Litex's Statement of Undisputed MaterialFacts in Supp. of Delphi Corp.'s Mot. for Summ. J. ("Pl.'sResp.") [Doc. No. 21] ¶ 2; Def.'s Facts at 6, ¶ 2. According toLitex, these statements were false. Def.'s Facts at 7, ¶ 3.Delphi denies the falsity of this statement and asserts that asof July 20, 2001, it was developing NTP components and systems.Pl.'s Resp. ¶ 3.
Next, Litex observes, on July 30, 2001, Delphi issued a pressrelease announcing that its NTP system had achieved "significantreduction in emissions." Def.'s Facts at 7, ¶ 4. This statementtoo, Litex alleges, was false. Id. at ¶ 5. According to Delphi,the phrase quoted by Litex refers to the following laboratorytest results presented in the same press release: In steady-state testing in a diesel vehicle, the NTP exhaust aftertreatment system demonstrated greater than 55 percent reduction in oxides of nitrogen emissions without the need to add additional hydrocarbons or other reductants to the exhaust stream as well as demonstrating a significant reduction in particulates.
Pl.'s Resp. ¶ 4 (emphasis added) (citation omitted). Delphimaintains that read in its proper context (i.e., as applied to"steady-state testing") all of this information is true. Id. at¶ 5.
Litex notes further that in September 2001, Delphi's CEO andPresident J.T. Battenberg III ("Battenberg") "made a presentationto an international gathering of the automotive industry.Battenberg focused on Delphi's highlight technologies, includingits alleged development of NTP." Def.'s Facts at 7, ¶ 6. Duringhis presentation, Battenberg stated: Let me also mention that Delphi is the only supplier with full diesel injection and exhaust aftertreatment capability including our award winning non — thermal plasma aftertreatment technology that helps remove nitrogen oxide to improve emissions for diesel and lean burn.Id. Litex contends that these statements were false. Id. at ¶7. According to Delphi, however, these statements were truebecause the time the speech was made, "Delphi was developing NTPas an exhaust aftertreatment technology." Pl.'s Resp. ¶ 7.
Next, Litex highlights Delphi's October 16, 2001 press releasewhich stated:
Delphi has developed an innovative aftertreatment solution, non-thermal plasma technology that works in conjunction with a catalytic converter and a particulate filter. Def.'s Facts at 7, ¶ 8. These statements, Litex contends, werealso false. Id. at ¶ 9. Delphi maintains that the statement wastrue because it was developing the technology at the time of thestatement's issuance. Pl.'s Resp. ¶ 9.
Litex observes further that Delphi's 2001 annual reportcontained the following false statements: Responding to global demands for improved fuel efficiency and reduced exhaust emissions, Delphi offers advanced powertrain control systems such as cylinder deactivation, gasoline direct injection and non-thermal plasma (NTP) exhaust aftertreatment. . . . . Late in 2001, Delphi and PSA Peugeot Citroen debuted a Peugeot 206 Environmental Technologies Vehicle, featuring NTP exhaust aftertreatment which significantly reduces oxides of nitrogen emissions, enabling more rapid use of advanced fuel-efficient technologies.Def.'s Facts at 8, ¶¶ 10-11 (emphasis in original). According toDelphi, however, these statements were not false because at thetime, it was "developing NTP." Pl.'s Resp. ¶ 11. Additionally,Delphi points out, its NTP technology was featured on a Peugeot"concept" vehicle that displayed several other "potential futuretechnologies." Pl.'s Post-Hr'g Mem. [Doc. No. 25] at 4. Moreover,Delphi notes that its NTP technology "did technically `work' — itremoved [nitrogen oxide] from exhaust both in the laboratory andin vehicle testing." Id.
Litex next points out that during the parties' patentlitigation discovery it specifically asked Delphi's ExecutiveVice-President Donald Runkle ("Runkle") about the accuracy of Delphi's press releases and public statements. Def.'s Facts at 8,¶ 12. During Runkle's deposition the following exchange occurred: Q. Are you aware of whether Delphi has ever issued an inaccurate press release? A. No, I don't know that we have that I know of. We obviously try to not issue inaccurate press releases, documents, or anything. We pride ourselves on accuracy, timeliness, so forth.Pl.'s Resp. ¶ 12 (citations omitted).
During his deposition, Battenberg was asked about the accuracyof Delphi's 2001 annual report and stated that, to his knowledge,it did not contain any inaccuracies. Def.'s Facts at 8, ¶ 13.Litex next observes that in October 2001 Delphi expressed itsconfidence in its NTP program in a presentation to Toyota MotorCorporation, a potential customer. Def.'s Facts at 9, ¶ 16.During that presentation, Delphi represented that it "would haveNTP samples available in 2002 and was targeting overallproduction of NTP for 2005." Id. Litex notes that Delphi madesimilar representations to General Motors Power Train in December2001. Id. at ¶ 17.
Litex further points out that in a February 21, 2002 letter insupport of Delphi's nomination for a research and developmentaward, Delphi's chief technologist Jean Botti ("Botti") stated: Delphi Automotive Systems is very excited about [NTP] and the technology that was developed for it over the last few years. In fact, Delphi has labeled this as one of our "Crown Jewel" technologies and we have put significant effort into developing this system to a commercial ready product. . . . We continue to invest our R&D resources in this technology, because it has shown such promise in reducing [nitrogen oxide] and particulate emissions in light and heavy-duty diesel engines.Def.'s Facts at 9, ¶ 19.
Litex next observes that during the patent litigationdiscovery, Delphi's Rule 30(b)(6) witness Joachim Kupe ("Kupe")stated that it was not until March 2002 that Delphi realized thatit did not have viable NTP technology. Id. at 10, ¶ 20. Duringthe parties' post-settlement arbitration, however, Bottitestified that by July 2001, Delphi had "[v]ery minimal"confidence in the NTP project. Id. at ¶ 21. Further, JosephBonadies, the program manager for Delphi's NTP program, testifiedduring the post-settlement arbitration that in May 2001, he was"very skeptical that we would come up with a system that couldachieve these really high [nitrogen oxide] efficiencies." Def.'sFacts at 11-12, ¶ 22.
Additionally, Litex points out, during the arbitrationproceedings, Botti acknowledged that he reported the NTP team'snegative conclusions to Delphi management in 2001 and that byJuly 2001, he was prepared to terminate the project: Q. Right. But as of . . . July 2001, did the company know it wouldn't work, or was that your personal opinion? A. No. I think — I mean, you know, like every big company there is inertia. But I already had given my opinion to my upper management that this thing was not going the way I wanted it. . . . . Q. And was there still speculation [that the NTP project would succed] in July 2001 among some people in the company? A. Not anymore. From my level to, uh, it was pretty clear already, you know. I told my management I was going to stop the project. Q. Uh, did the management ever give — you had told them that as of July 2001? A. Well, I started to, uh, update the management after we had that PSA review that will show that the results were disastrous. And, uh, you know, I — I had to step up and tell my management that, because I was a customer interface, and there was a shared, I would say, development I needed to update the management and say, we're not going anywhere with this. Q. And do you recall when that occurred? A. Uh, PSA review, quite honestly, I — I — I don't recall, but it was — I'm sure it was before July 2001. It must have been the spring of 2001 when we started to get those terrible results.Id. at 12-13, ¶ 24 (internal citation omitted).
According to Litex, prior to the arbitration proceedings, ithad no knowledge of the falsity of Delphi's representations aboutthe 2001 success of its NTP project. Id. at ¶ 27. Litexmaintains further that it relied reasonably and to its detrimenton those representations as material statements about Delphi'sNTP program in deciding to enter into the settlement agreementwith Delphi. Id. That is, "[a]t arbitration, Litex premised itsdamages arguments on the belief that in 2001 Delphi wassuccessfully developing NTP, and therefore, would have willinglytaken an exclusive license to Litex's patents in an arm's-length`hypothetical negotiation' in July, 2001." Id. at ¶ 29. Because it was unaware that Delphi's statements were false,Litex argues, it "could not have appreciated when signing the[agreement] the tortious interference and unfair businesspractice claims it had against Delphi." Def.'s Mem. at 9. Inother words, Litex "was led to believe that its only remedies layin an award of damages for patent infringement." Id. Accordingto Litex, Delphi admitted in arbitration that it lackedconfidence in its NTP project as early as July 2001 because itwas then advantageous for it to do so.3 Id. at 6."Finally knowing the truth, Litex, now seeks relief from the[allegedly] fraudulent Release so it may pursue Delphi's actualwrongs — not infringing Litex's patent by developing NTP, butrather misleading the world into believing that Delphi wasdeveloping NTP at all." Id. at 10.
A. Standard of Review
The parties originally configured the matter before the Courtas cross motions for summary judgment. Prior to oral argument,however, the parties consented to this Court's treatment of the matter as a case stated. Continental Grain Co.v. Puerto Rico Mar. Shipping Auth., 972 F.2d 426, 429 n. 7 (1stCir. 1992) (observing that resolution of a matter as case statedrather than cross motions for summary judgment promotes judicialefficiency); Boston Five Cents Sav. Bank v. Secretary of Dep'tof Hous. & Urban Dev., 768 F.2d 5, 11-12 (1st Cir. 1985) (same).Unlike cross motions for summary judgment, this procedure allowsthe Court to determine "significant issues of material fact."Continental Grain Co., 972 F.2d at 429 n. 7 (citing BostonFive, 768 F.2d at 11-12). Thus, the Court must review therecord, draw reasonable inferences, apply the governing law, andenter such judgment as may be appropriate.
According to Delphi: [t]he undisputed facts of this matter conclusively demonstrate that: (1) the settlement [agreement] . . . is enforceable, (2) Delphi did not fraudulently induce Litex to sign the [agreement] . . ., and (3) Litex knew or should have known of the factual allegations underlying the tort claims it now seeks to assert before executing the [agreement], . . . making its reliance on Delphi's statements unreasonable as a matter of law.Pl.'s Mem. at 1-2. Litex maintains, however, that: (1) thesettlement agreement is not enforceable because it was induced byDelphi's fraud, Def.'s Mem. at 10, and (2) its reliance onDelphi's statements was reasonable. Id. at 12.
B. Fraud in the Inducement "A court cannot enforce a settlement contract which is tainted. . . by fraud practiced upon a party to the contract."Flebotte v. Dow Jones & Co., Inc., Civ. A. No. 97-30117-FHF,2001 U.S. Dist. LEXIS 21327, *13 (D. Mass. June 28, 2001)(Freedman, J.) (citation and alterations omitted) (unpublishedopinion). The First Circuit directs that, in these circumstances,Massachusetts contract principles govern the evaluation offraudulent inducement claims. Nash v. Trustees of BostonUniv., 946 F.2d 960, 967 (1st Cir. 1991). Under Massachusettslaw, to establish a claim for fraud in the inducement a plaintiffmust prove: (1) the defendant made knowingly false statements;(2) those statements were made with the intent to deceive; (3)those statements were material to the plaintiff's decision toexecute the agreement; (4) the plaintiff reasonably relied onthose statements; and (5) the plaintiff was injured as a resultof her reliance. Zyla v. Wadsworth, 360 F.3d 243, 254 (1stCir. 2004) (citing Kenda Corp. v. Pot O'Gold Money Leagues,Inc., 329 F.3d 216, 225 (1st Cir. 2003) (applying Massachusettslaw)).
1. Delphi's Intent to Induce Settlement with Allegedly FalseStatements
Delphi argues that Litex's claim of fraudulent inducement mustfail because there is no evidence that any of its statements wereintended to induce Litex's execution of the settlement agreement.Pl.'s Mem. at 11-12 (citing Willett v. Herrick,258 Mass. 585, 596-97 (1927) ("To enable a party to rescind a contract because of fraud or misrepresentation, the fraud ormisrepresentation relied on must have operated to cause him tomake the contract or have been intended to influence the actionin the particular complained of.")). First, Delphi observes, thepress releases at issue were published in 2001, "years before"the execution of the settlement agreement. Id. at 12.
Second, Delphi contends, the purpose of those statements was toinform the industry publicly about its research and not "toinduce Litex to execute the Settlement Term Sheet & Release."Id. Additionally, Delphi suggests that it never made anystatements concerning its position on the success or failure ofits NTP project as of the summer of 2001 during the settlementnegotiations. Id. Accordingly, Delphi concludes that "Litex hasfailed to satisfy the `inducement' element of its fraudulentmisrepresentation claim." Id.
In response, Litex first notes that "Delphi's argument indeedits entire motion, wrongly presumes that Delphi's lies ended in2001 with the 2001 [s]tatements themselves." Def.'s Mem. at 11.In entering into the settlement agreement, Litex claims it"reasonably relied to its detriment not only on Delphi's pressreleases and public statements from 2001, but also on the NTPdocuments Delphi authored and produced in discovery, and Delphi'sdeposition testimony about the NTP program in 2001." Id. The record demonstrates that during the parties' discovery,Delphi did, in fact, make representations to Litex regarding thesuccess of its NTP research.
For example, one Delphi employee testified during hisdeposition that it was not until March 2002 that Delphi realizedthat it did not have viable NTP technology. Def.'s Facts at 10, ¶20 (citation omitted). That same employee testified that as ofFebruary 21, 2002 Delphi still considered NTP one of its "crownjewel technolog[ies]" and that it was in March 2002 that Delphi"hit the hard reality" that there was "[n]o [c]rown [j]ewel, notechnology proven, no product." Id. (citations omitted). Duringthe post-settlement arbitration, however, Botti, Delphi's chieftechnologist, testified that Delphi management was aware that theNTP project was not working by July of 2001 and that Botti wantedto terminate the project. Id. at 12, ¶ 24 (citations omitted).Further, although the statements in Delphi's 2001 press releasesand annual report were not made directly to Litex, Delphi's VicePresident Runkle testified during the patent litigation discoverythat all of Delphi's press releases were true. Pl.'s Resp. ¶ 12.Further, Delphi's CEO Battenberg testified in his deposition thatDelphi's 2001 annual report was "accurate." Def.'s Facts at 8, ¶13 (citations omitted).
In short, Delphi's argument that its 2001 press releases wereissued years before the settlement was reached and that suchreleases were not made directly to Litex is unavailing because Delphi affirmed their accuracy during the parties' discovery.Delphi's argument that it never made "any statements concerningDelphi's position on the success or failure of its NTP project asof the summer of 2001" is inaccurate. Pl.'s Mem. at 12. That is,during discovery, Delphi affirmed the accuracy of the claims madein its 2001 press releases. Moreover, during discovery, Delphirepresented that through February 2002 it considered NTP one ofits "crown jewel technologies." Def.'s Facts at 10, ¶ 20.
Therefore, the 2001 origin of Delphi's public statements doesnot foreclose a finding that Delphi's discovery statements weremade, in part, to induce Litex's execution of the settlementagreement. Trent Partners & Assocs., Inc. v. Digital Equip.Corp., 120 F. Supp. 2d 84, 108 (D. Mass. 1999) (Woodlock, J.)(noting that the existence of fraudulent intent is normally aquestion of fact). This Court, however, need not resolve thisissue because, as discussed below, even if Delphi made falsestatements intended to induce Litex's execution of the settlementagreement, Litex's reliance on such statements was unreasonable.
2. Alleged Falsity of Delphi's Pre-Settlement Statements
Delphi next argues that Litex's claim of fraudulent inducementmust fail because all of its statements were true in that theyaccurately reflected the state of Delphi's NTP project. Delphi'sOpp'n to Litex's Cross-Mot. for Partial Summ. J. and Reply Mem.in Further Supp. of Delphi's Mot. for Summ. J. ("Pl.'s Opp'n") [Doc. No. 20] at 6. For example, Delphi points out thatits October 16, 2001 press release stating that "Delphi ha[s]developed . . . non-thermal plasma technology (NTP) that works inconjunction with a catalytic converter and a particulate filter"was true. Id. at 7. Litex contends that this statement wasfalse in that Delphi had not "developed" any NTP technology atall. Litex's Reply Br. in Further Supp. of Cross-Mot. for PartialSumm. J. ("Def.'s Reply Mem.") [Doc. No. 22] at 4. Rather, Litexobserves that at the time Delphi issued the press release, it hadconcluded that NTP was something "it could never make work" andwas "going to stop." Id.
As Delphi points out, however, Litex blurs the importantdistinction between the NTP results Delphi was able to achieve inthe laboratory and its ultimate inability to commercialize an NTPproduct. Pl.'s Post-H'rg Mem. at 4. It is undisputed thatDelphi's NTP project yielded positive laboratory results. Pl.'sFacts ¶¶ 4, 6; Def.'s Facts at 2, ¶¶ 4, 6. Further, as Delphipoints out, "the record establishes that Delphi's NTP system didtechnically `work' — it removed [nitrogen oxide] from exhaustboth in the laboratory and in vehicle testing." Pl.'s Post-H'rgMem. at 4. Delphi's "statements about its promising researchresults are [not] inaccurate" simply because "it later turn[ed]out that the research d[id] not lead to a commercial product."Id. Thus, Delphi's skepticism regarding its ability ultimately tocommercialize an NTP product does not belie the initial successDelphi enjoyed in developing NTP. Indeed, despite its pessimismin 2001, Delphi's early laboratory success led it to continue theNTP program for another year and to expend an additional milliondollars on the project. Id. at 5. Thus, Litex has not met itsburden of establishing that Delphi's October 16, 2001 statementthat it "has developed" NTP technology was knowingly falsebecause that statement did not claim that Delphi had developed acommercial product.4
Delphi next argues that each of its 2001 press releases and its2001 annual report are true. Pl.'s Opp'n at 6-9. At most, Delphiargues, the statements contained in those documents constituted"nothing more than `puffery' or `trade talk' which cannotpossibly give rise to a fraud claim." Id. at 9-10. "Puffing hasgenerally been defined as exaggerated, vague, or looselyoptimistic statements about a company." In re Allaire Corp.Secs. Litig., 224 F. Supp. 2d 319, 327 (D. Mass. 2002) (internalquotation marks and citation omitted). "[S]tatements of opinion,especially trade talk and puffing, are generally not adequatepredicates for a finding of fraud unless the statements suggest that a significant amount of factual informationunderlies the opinion. . . ." Putnam Res. v. Pateman,958 F.2d 448, 460 n. 8 (1st Cir. 1992). Whether statements are merepuffery or trade talk is matter of fact. See, e.g.,McLaughlin v. Denharco, Inc., 129 F. Supp. 2d 32, 39 (D. Me.2001); White v. ABC Home Inspection, Inc., 2000 Mass. Super.LEXIS 336, *15 (June 27, 2000) (Botsford, J.) (unpublishedopinion).
According to Delphi, each of the statements cited by Litex"merely indicated that Delphi was researching and developing NTPfor exhaust treatment applications. Such statements are notstrongly optimistic, concrete or definite." Pl.'s Opp'n at 10."The project's unresolved problems," Delphi maintains, "did notrequire disclosure and did not render Delphi's statementsfraudulent." Id. See also id. (citing Van Ormer v. AspenTech., Inc., 145 F. Supp. 2d 101, 105 (D. Mass. 2000) (Zobel,J.) (noting there exists no duty "to disclose technologicalproblems")). Litex contends, however, that Delphi's statementswent beyond mere puffery. Def.'s Mem. at 12-13; Def.'s Reply at3-4. The issue, Litex suggests, is not whether Delphi's 2001statements claimed ultimate commercial viability of NTP butwhether they claimed to "ha[ve] developed" a working NTP systemachieving "significant" reductions in emissions "as opposed to afailed project Delphi `could never make work' and was `going tostop.'" Def.'s Reply at 4. Thus, the 2001 statements with which Litex takes issue centernot only on Delphi's opinions about NTP but whether Delphi hadactually "developed an innovative after-treatment solution,nonthermal plasma technology (NTP) that [was] work[ing] inconjunction with a catalytic converter and particulate filter."Ekchian Decl., Ex. 4 (Delphi News Release of Oct. 16, 2001)(emphasis added). As discussed above, however, Litex, ineschewing the distinction between laboratory research andcommercial readiness, has failed to demonstrate the falsity ofthis statement. Thus, even if this statement went beyond merepuffery, it cannot provide Litex with the basis for a fraudulentinducement claim.5
Litex next cites Delphi's statements made during the parties'patent litigation discovery. Def.'s Reply at 5. During thatdiscovery, Delphi's witness testified that as of February 21,2002, Delphi remained "very hopeful" that its NTP project wouldsucceed, that NTP was one of its "crown jewel technolog[ies],"and that it was March 2002 when Delphi "hit the hard reality"that there was "[n]o [c]rown [j]ewel, no technology proven, noproduct." Def.'s Facts at 10, ¶ 20. During the arbitrationproceedings, however, Delphi maintained that by July 2001, Delphi did not expect its NTP project to succeed. Id. at12-13, ¶ 24.
Delphi argues that the testimony of its witnesses at thearbitration proceedings "fall far short of demonstrating" thatDelphi made knowingly false statements. Pl.'s Opp'n at 8. "Nordoes this testimony establish that Delphi actually terminated itsNTP project in 2001 or knew in 2001 that the project would nevercommercially succeed, as Litex now contends." Id. at 9. Atbest, Delphi contends, the testimony cited by Litex "shows thatthose individual witnesses were skeptical about the ultimatecommercial success of the NTP program as early as 2001." Id.The personal opinions of those witnesses, Delphi maintains, doesnot show "that Delphi as an institution knew in 2001 that itsNTP program would never achieve commercial viability." Id. "Tothe contrary," Delphi observes, it "continued to pursue its NTPprogram into 2002 — an undisputed fact that completely underminesLitex's contention that Delphi's NTP program was effectively deadin 2001." Id.6 Even if Delphi did not "know" in 2001 that its NTP programultimately would fail, the record demonstrates that, by 2001,Delphi was institutionally pessimistic about the project'spotential success. During his arbitration testimony, Botti notonly indicated that he personally lacked confidence in the NTPproject by July 2001 but that the "company" was apprised of thatopinion as well. Def.'s Facts at 12, ¶ 24. Furthermore, Bottitestified that as of July 2001 there was no speculation amonganyone at Delphi that the NTP project ultimately would succeed.Id. Furthermore, during the 2004 arbitration proceedingsDelphi, in arguing that it would have been willing to pay only aminimal fee to license Litex's patent, expressly relied onBotti's testimony to establish that "Delphi seriously doubted thefuture of its NTP project by May 2001." Def.'s Reply Mem. at 2(citation omitted).
The record evidence thus permits the inference that, during theparties' discovery, Delphi made knowingly false statementsregarding when Delphi began to doubt the success of its NTPproject.7 That is, during discovery Delphi maintainedthat it was "very hopeful" about its NTP project and consideredit a "crown jewel technology" until February 2002. Def.'s Factsat 10, ¶ 20. At the parties' post-settlement arbitration,however, Delphi stated that by July 2001 there was "no expectation" thatthe NTP project would succeed. Id. at 11, ¶ 21. One of thesestatements must be false. Moreover, that Delphi did notofficially terminate its NTP project until 2002 is notdispositive of whether Delphi made false statements to Litexregarding when it began to doubt that its NTP project wouldultimately succeed.
3. Reasonableness of Litex's Reliance
Delphi next argues that judgment must be granted in its favorbecause Litex cannot establish a necessary element of its claimof fraud in the inducement, namely, reasonable reliance on itsallegedly false statements. Pl.'s Mem. at 12. As Delphi pointsout, a claim for fraudulent inducement fails when the plaintiffknew that the defendant's statement was false. Id. (citingNortheastern Univ. v. Deutsch, 14 Mass. L. Rep. 423,2000 Mass. Super. LEXIS 100, *10 (Mass.Super. Mar. 21, 2002)(Connolly, J.) ("[T]he plaintiff's claim will fail when theplaintiff knew that the defendant made a false statement, therebymaking his reliance unreasonable. . . . Thus, the plaintiff mustprove that he did not know of the facts which made his relianceunreasonable." (internal citation omitted)). See also Cote v.Astra USA, Inc., Civ. A. No. 96-2501-J, 1998 Mass. Super LEXIS276, *15 (1998) (Botsford, J.) (unpublished opinion)("Massachusetts courts have denied relief in those instances where the plaintiff alleging fraudulent misrepresentation knew offacts which made his reliance on the misrepresentationunreasonable."). Delphi observes that prior to the execution ofthe settlement agreement, Litex alleged that Delphi's publicreleases were inaccurate. Pl.'s Mem. at 12. Therefore, Delphisuggests, Litex could not have reasonably relied on thosestatements. Id. at 13.
According to Litex, "Delphi blurs the facts here." Def.'s Mem.at 14. That is, "[e]ach of the excerpts Delphi quotes fromLitex's depositions, briefs and expert report show Litex wasaware, and concerned, that Delphi's 2001 statements inaccuratelyclaimed as Delphi's the NTP technology Litex had developed."Id. Thus, Litex argues, during the patent case, it believedthat the 2001 statements inaccurately represented who hadinvented and owned NTP technology. Id. "In contrast, Litexhad no knowledge that, separate and apart from who had inventedand owned the NTP technology, Delphi was misrepresenting that itwas successfully using the technology." Id. In his depositionduring the patent litigation, Litex's CEO, Dr. Leon Ekchian("Ekchian") explained Litex's concern at the time: Q. [B]ut my question really is focused on why do you believe that whatever Delphi's activities are that they have adversely impacted Litex's ability to license in the diesel or lean burn area? A. It's Delphi's infringement, Delphi's very active press release activities which have stated that Delphi developed NTP. I believe those are the words, suggesting that Delphi invented NTP. Delphi's total disregard for Litex's existence in all the papers it has filed and that have issued. Delphi's statement that they will be the first to market with revolutionary new technology, suggesting that they again are the first to develop the technology.Id. at 15 (citation omitted). According to Litex, it had noknowledge until after signing the settlement agreement thatDelphi's 2001 statements also misrepresented the progress Delphiwas making with NTP. Id.
Delphi counters that "Litex's questioning of Delphi's pressreleases during [the patent litigation] was not confined toownership issues." Pl.'s Opp'n at 15. That is, during the patentlitigation, Litex also believed that Delphi's public statementsregarding NTP were "overly optimistic." Pl.'s Opp'n at 15. Tosupport its contention, Delphi cites the following portion ofEkchian's deposition: Q. [B]ut can you tell me what you have in mind by the concept of inaccurate press releases? . . . . A. Well, I find that now, frankly, quite surprising that Delphi was making those press releases that they'll be first to market being very confident in the statement that its making and now from what I understand in reading some of the documents . . . stating that Delphi was being overly optimistic, I find that very surprising. I would think that a corporation would need to be more careful about statements it makes, about how confident they are, because it impacts other companies, particularly small companies. Again, investors, customers reading these press releases, you know, it's very difficult for Litex to try to placate the concerns of potential investors when there are these kinds of statements, very confident statements by Delphi that they will be first to market and they're targeting 2004, and now I'm reading that maybe they were overly optimistic. I find that to be unreasonable and cause damage.Id. at 16.
These facts, Delphi suggests, confirm that during the patentlitigation, Litex believed and asserted that Delphi's overlyoptimistic press releases regarding its NTP program harmed Litexby interfering with its "licensing, financing, and businessrelationships." Id. at 17. "Nevertheless, Litex executed the[settlement agreement] knowing full well that it was releasingDelphi from any claims arising out of those allegations." Id.Litex maintains, however, that when it signed the agreement itwas "unaware that Delphi's 2001 [s]tatements contained fraudulentrepresentations actionable as tortious interference." Def.'sReply at 6.
That is, Ekchian's testimony that he believed Delphi's pressreleases were "overly optimistic," does not evince his beliefthat they were knowingly false. Id. at 6-7. Indeed, Ekchian'ssuggestion that Delphi had been overly optimistic is exactly theopposite of what Litex now claims: that Delphi had no hope ofsuccessfully developing NTP as of July 2001 but continued toknowingly misrepresent its success in that area. Id. at 7. AsLitex observes, Delphi's witness testified during discovery that,as of February 2002, it was still "very hopeful" that the projectwould succeed and that it was not until March 2002 that it realized that the project would not work. Def.'s Facts. at 10, ¶20.
According to Delphi, however, Litex could not reasonably haverelied on its statements regarding its NTP success because "Litexpossessed sufficient evidence during [the patent litigation] toknow that Delphi doubted the success of its NTP project in2001. . . ." Pl.'s Opp'n at 17. That is, contends Delphi, thepatent litigation record shows that it disclosed to Litex that: (1) Delphi abandoned catalyst development for its NTP project in April 2002; (2) Delphi terminated its entire NTP research project in September 2002; (3) During the Summer and Fall of 2001, Delphi's tests of its NTP project recorded less than 15% [nitrogen oxide] reduction efficiencies when 90% [nitrogen oxide] reduction efficiencies were need[ed] for a viable commercial product; (4) In 2001, Delphi had 25 engineers working on the NTP project; in 2002, that number was reduced to 12 or 13; (5) By 2002, Delphi had cut its NTP research project budget in half, compared to the level of funding budgeted for the same project in 1998; (6) Delphi's management knew of the diminishing success of the NTP project; (7) By July 2001, based on poor testing results, Delphi was not confident about the success or commercial viability of its NTP research.Pl.'s Mem. at 17-18 (internal citations omitted).
According to Delphi, "[t]hese facts establish that during thetime proximate to the press releases (2001-2002), Delphi's NTP project was achieving unfavorable results, the budget andwork force assign[ed] to the project had been reduced, and thatDelphi's management knew of the waning success." Id. at 18.Further, Delphi observes, within months of the press releases,Delphi terminated the project. Id. Therefore, Delphi maintains,"the only reasonable inference to draw is that Litex knew, longbefore executing the [settlement agreement] that Delphi itselfdoubted the commercial viability of NTP in 2001." Id.
In response, Litex points out that the first two "facts" citedby Litex refer only to events occurring in 2002 and are far fromconclusive proof of Delphi's state of mind in 2001. Def.'s Mem.at 17. The third "fact" cited by Delphi demonstrates that Delphihad not reached its target goal of 90% nitrogen oxide reduction,it does not, however, establish Delphi's pessimism regarding theproject's ultimate success. The fourth and fifth "facts"referring to Delphi's NTP budget and the number of engineersworking on project similarly do not conclusively show that Delphilacked confidence in the project by July 2001.
The sixth "fact" mentioned by Delphi concerns the September 6,2002 deposition testimony of Runkle. Pl.'s Opp'n at 18. Duringthat deposition the following exchange occurred: Q. At what point did Delphi realize it was having trouble developing its NTP catalyst?
A. I don't know when we realized it. I guess when I realized that it wasn't turning as we had hoped probably was over the last year and a half I would say when the results were not as good as we thought. Aff. of William Cosnowski [Ex. 12, Doc. No. 14] (Dep. of DonaldL. Runkle) at 114 (emphasis added). According to Litex, Runkle's"equivocal" answer "stand[s] in stark contrast to [Kupe's]testimony about NTP that unequivocally placed the change in theNTP program in March, 2002 and not before." Def.'s Reply at 5-6(citation omitted). Thus, Litex contends, Runkle's testimony "didnot put Litex on notice that Delphi was lying or render Litex'scontinued reliance on the 2001 [s]tatements unreasonable." Id.at 6.
The seventh "fact" cited by Delphi refers to the report ofDelphi's damages expert Dr. Abram E. Hoffman which was submittedduring the parties' patent litigation. As Delphi notes, thatreport stated that "[e]ven in July 2001 and beyond, Delphiremained unsure that it could develop a suitable catalyst orproduce an NTP system at an acceptable economic or energy cost."Pl.'s Mem. at 19 (emphasis added). Further, the report noted,"By July 2001 . . . because Delphi did not have a commercialNTP product and was not confident that it would, it would haveonly wanted a license for testing purposes and possibly an optionfor future commercialization. . . ." Id. (emphasis added).According to Delphi, "no doubt exists that the informationprovided by Delphi's witnesses and summarized in Dr. Hoffman'sreport directly contradicts Litex's current position allegingthat Delphi failed to disclose its concerns over the success ofthe NTP project as of the [s]ummer of 2001." Id. at 19-20. Whether reliance is reasonable is matter of fact.Massachusetts Laborer's Health & Welfare Fund v. PhillipMorris, Inc., 62 F. Supp. 2d 236, 242 (D. Mass. 1999) (O'Toole,J.). This issue may be determined as matter of law only if noreasonable factfinder could conclude that the reliance wasreasonable. Trent Partners, 120 F. Supp. 2d at 105. Inaddressing Delphi's damage expert's report, Litex acknowledgesthat the report "summarize[s] the information Dr. Hoffmanbelieved Delphi would consider in a hypothetical negotiationwith Litex." Def.'s Mem. at 18. The hypothetical negotiationcontemplated by the report was to take place on July 3, 2001.Aff. of William Cosnowski [Ex. 8, Doc. No. 14] (Rebuttal ExpertWitness Report of Abram E. Hoffman ("Hoffman Report")) ¶ 151.
Inexplicably, Litex suggests that Dr. Hoffman's report did notput it on notice of the fact that Delphi lacked confidence in itsNTP project in 2001 because the report "cite[s] no factualsupport" for its statements. Def.'s Mem. at 18. Whether Delphistated further information beyond its admission that it lackedconfidence in its NTP project in 2001, however, is irrelevant towhether Litex was put on notice of Delphi's pessimism at thetime. In any event, Dr. Hoffman did cite specific factualinformation for the conclusion that Delphi lacked confidence inits NTP project in July 2001. Hoffman Report ¶ 52, 158 (citing asreasons for Delphi's pessimism regarding its NTP project (1)"technological and cost hurdles", (2) the uncertainty that Delphi could "produce an NTP system at an acceptable economic or energycost", (3) Delphi's inability to "find a suitable catalyst", and(4) that "the fuel penalty was above the level that customerswould accept").
Confusingly, Litex also claims that no part of the report"address[es], let alone clarif[ies], the state of Delphi's NTPprogram before March, 2002, as opposed to after." Def.'s Mem. at18. A cursory reading of the report, however, reveals that thisposition is untenable: Delphi was not at all confident about the future commercial success of its NTP product at [the July 2001 hypothetical] negotiation date given the technological and cost hurdles it had to overcome. . . . . Even in July 2001 and beyond, Delphi remained unsure that it could . . . produce an NTP system at an acceptable economic or energy cost. . . . . Because Delphi was uncertain whether NTP technology would ever be commercially viable, it had no definite plans for commercialization. . . . [B]y July 2001. . . . Delphi was even less certain that an NTP product would succeed.Hoffman Report ¶¶ 52, 156, 158.
Thus, Litex's assertion that "none of the `facts' cited byDelphi put [it] on notice of the true state of Delphi's NTPprogram in 2001" is incomprehensible. Def.'s Mem. at 19. Litex isalso mistaken in contending that the report fails to"contradict . . . [its contention] that Delphi failed todisclose its concerns over the success of the NTP project as of the [s]ummer of 2001." Def.'s Mem. at 19 (internal quotationmarks and citation omitted). As cited passages above demonstrate,Dr. Hoffman's report clearly revealed Delphi's July 2001pessimism.
Litex argues further that the report did not put it on noticeof the true state of Delphi's NTP project in 2001 because "Dr.Hoffman opine[d] based upon the eventual cancellation of the NTPprogram" using the "so-called `Book of Wisdom'" hindsightapproach. Def.'s Mem. at 18-19 n. 6. Therefore, Litex contends,the report did not "delineate the circumstances before and afterany point in time, including March, 2002." Id. Again, Litex'sargument is moribund because, as the cited passages establish,the damage report specifically addressed the state of Delphi'sNTP project in July 2001 without reference to future events.
As Litex recognizes, in agreeing to arbitrate its patentdispute with Delphi "Litex premised its damages arguments on thebelief that in 2001 Delphi was successfully developing NTP, andtherefore, would have willingly taken an exclusive license toLitex's patents in an arm's-length `hypothetical negotiation' inJuly, 2001." Def.'s Mem. at 9 n. 1 (emphasis added). "Instead,"Litex suggests, "Delphi ambushed Litex before the arbitratorwith the truth, revealing that in 2001 Delphi . . . would nothave taken an exclusive license at all." Id. (emphasis added).This argument completely ignores the evidence discussed above.Delphi's damage expert's report explicitly noted: As technological demands shift and potentially multiple technologies need support, suppliers such as Delphi would not pay a large fixed payment for an exclusive license to unproven technology that their OEM customers may not demand.
. . . .
The hypothetical negotiation would have taken place on . . . July 3, 2001 concurrent with the issue dates of the patents. The negotiation would occur between a willing buyer and a willing seller. . . . Also, the negotiation would be for the non-exclusive rights to practice the two patents in suit only. . . . Delphi would have come to the negotiating table aware that: [i]t has no current commercial product and is uncertain of the commercial viability of its NTP product.Hoffman Report ¶¶ 52, 151-52 (emphasis added). Further, Hoffmanobserved: By July 2001. . . . because Delphi did not have a commercial NTP product and was not confident that it would, it would have only wanted a license for testing purposes and possibly an option for future commercialization.Id. at ¶ 159 (emphasis added).
Based on the evidence described above, Litex could notreasonably have relied on Delphi's discovery statements that itdid not lose confidence in its NTP project until March 2002. AsLitex acknowledges, its claim of fraudulent inducement relies onits allegation that Delphi fraudulently indicated that it "hadonly the greatest confidence in and highest expectations for itstechnology up until March, 2002" and that it was not untilarbitration that Delphi acknowledged the dubious state of its NTPprogram in 2001. Def.'s Mem. at 6. Given the informationcontained in Delphi's damage report, Litex's reliance on any statements to the contrary, either in Delphi's 2001 publicstatements or during discovery, was unreasonable. Yorke v.Taylor, 332 Mass. 368, 374 (1955) (holding that plaintiff'sreliance unreasonable as matter of law where oral statements were"palpably false" in light of contradictory written statements).See also Trifiro v. New York Life Ins. Co., 845 F.2d 30,33-34 (1st Cir. 1988) (holding plaintiff's reliance on one ofdefendant's two contradictory statements unreasonable as matterof law because "[t]he conflicting content of [the two statements]should have placed petitioner on notice that he should not relyon either statement. Confronted by such conflict a reasonableperson investigates matters further; he receives assurances orclarification before relying."); Guilbeault v. R.J. ReynoldsTobacco Co., 84 F. Supp. 2d 263, 281 (D.R.I. 2000) (noting thatplaintiff's reliance on statement is unreasonable as matter oflaw when defendant's statement conflicts with plaintiff's ownknowledge of facts).
Accordingly, even if Delphi's 2001 press releases falselytouted the success of its NTP project and even if one of Delphi'switnesses falsely stated that Delphi did not begin to loseconfidence until March 2002, Litex could not reasonably haverelied on those statements given the contradictory statementscontained in Delphi's damage expert's report. That reportconspicuously indicated that as of July 2001, Delphi was not atall confident in its NTP project. Litex's contention that Delphi "ambushed" it during arbitration with this admission ispreposterous in light of this record evidence.
Moreover, to the extent that Litex claims reliance on theallegedly false statement in Delphi's 2001 annual report that it"offer[ed]" NTP and that it placed a working NTP system on aPeugeot vehicle, such reliance is also unreasonable. DuringBattenberg's deposition, the following exchange occurred withcounsel for Litex: Q. And what did you mean by saying that Delphi offered nonthermal plasma (NTP) exhaust aftertreatment? . . . . A. Well, as it says in the next sentence that Delphi and Peugeot debuted an environmental technology vehicle featuring NTP exhaust aftertreatment. So we have a technology vehicle which is an R&D platform which we identified here. . . . . Q. How is it that you can say that you offer something if it's only in a research and development stage? A. Well, it's quite common. Many of the items on this page are in research and development. That's the nature of the business we're in. . . . . Q. Why did you put something that you considered to be in a research and development state into the annual report? . . . . A. Well, as I said several times before, the nature of the industry is such that it's three- to four- to five-year lead times and many technologies are put on research and development vehicles years in advance because it takes hundreds of thousands of miles of research and development to find out if they're going to work. Q. All right. And is it your practice to describe research activities that you don't know if they're going to work or not — A. Absolutely. Q. — in an annual report? A. Yes. Q. Why would you describe something in an annual report if you didn't know if it was going to work? . . . . A. . . . It's common practice.Ekchian Decl., Ex. 7 (Dep. of J.T. Battenberg III) at 119-21(emphasis added).8
Thus, to the extent that the 2001 press release can be read asmaking the false claim that Delphi had developed a working NTPproduct beyond the mere research and development stage, Litexcould not reasonably have relied on such a statement in light ofBattenberg's testimony and Dr. Hoffman's report. Indeed, duringthe parties' discovery, Delphi specifically acknowledged that itnever was able to develop a marketable NTP product. EkchianDecl., Ex. 13 (Dep. of Joachim Kupe) at 363-65. Because Litex cannot establish its reasonable reliance onDelphi's false statements, its fraudulent inducement claim mustfail. Zyla, 360 F.3d at 254. As the First Circuit has noted: Explicit conflict engenders doubt, and to rely on a statement the veracity of which one should doubt is unreasonable. The law does not supply epistemological insurance. Nor does it countenance reliance on one of a pair of contradictories simply because it facilitates the achievement of one's goal. [This] reasoning stands behind the principle of tort law that "the maker of a fraudulent misrepresentation is not liable to one who does not rely upon its truth but upon the expectation that the maker will be held liable in damages for its falsity." See Restatement, Second, Torts § 548.Trifiro, 845 F.2d at 34.
Because Litex's claim of fraudulent inducement must fail, theparties' settlement agreement is enforceable. Because Litex doesnot dispute that the tort claims it seeks to assert are barred bythe settlement agreement, summary judgment must be granted inDelphi's favor as Litex's assertion of its counterclaims violatesthe terms of the parties' settlement.
C. Attorneys Fees
Delphi has requested attorneys fees. Pl.'s Post-Hr'g Mem. at12. Litex's fraud claim is, however, not "so completely at oddswith the factual record and so devoid of legal merit," id. thatan award of attorneys fees and costs is in order. III. CONCLUSION
Accordingly, Litex's Cross Motion for Partial Summary Judgment[Doc No. 15] is DENIED and Delphi's Motion for Summary Judgment[Doc. No. 10] is ALLOWED, save for an award of attorneys fees.Because the parties' settlement agreement is enforceable, all ofLitex's counterclaims are hereby dismissed with prejudice.