De Lage Landen Financial Services, Inc. v. Rasa Floors, LP (792 F. Supp. 2d 812, 2011)

MEMORANDUM RE: PLAINTIFF’S AND OTHER PARTIES’ MOTIONS FOR SUMMARY JUDGMENT ON PLAINTIFF’S BREACH OF CONTRACT CLAIM AND DEFENDANTS’ COUNTERCLAIMS

BAYLSON, District Judge.

TABLE OF CONTENTS

I. Factual and Procedural History..............................................818

A. Background...........................................................818

B. Rasa Floors...........................................................820

C. Viewpoint.............................................................822

D. NCC .................................................................823

II. Legal Standards...........................................................824

A. Summary Judgment....................................................824

B. Choice of Law.........................................................824

III.Under Pennsylvania Law, DLL Is Entitled to Summary Judgment that Defendants Breached the Contract Between Defendants and DLL, as a Matter of Law...........................................................826

A. As a Matter of Law, DLL Has Established that Defendants Breached

Their Lease Agreements..............'................................826

B. Defendants’ Defenses Are Unavailing.....................................829

1. Defendants Cannot Establish that the Lease Agreements Are

Unconscionable..................................................829

2. Rasa’s Argument Regarding Breach by DLL Is Without Merit..........830

3. Defendants’ Arguments Regarding Breach by DLL and Mutual

Mistake Are Without Merit.......................................831

4. Defendants’ Argument Regarding Illegality Are Without Merit..........833

VI. Assertions By Third Party HP Do Not Prevent the Entry of Summary Judgment in Favor of DLL and Against Rasa, Viewpoint and NCC.............835

V. DLL Is Entitled to Summary Judgment on Defendants’ Counterclaims............837

A. Defendants Have Not Shown a Genuine Issue of Material Fact as to Fraudulent Misrepresentation .........................................837

1. Defendants Have Not Established Misrepresentation by Capital 4.....838

2. Conduct of Capital 4 May Not Be Imputed to DLL ....................839

a. Defendants’ Theory of Apparent Agency Is Without Merit..........841

b. Defendants’ Theory of Agency by Estoppel Is Without Merit........842

c. Defendants’ Agency Arguments Are an Attempt to Circumvent

Language of Finance Lease Contracts..........................842

3. Defendants Have Not Established Misrepresentation by DLL and DLL Had No Obligation to Disclose Information to Defendants 843

B. Claims Under Various Consumer Protection Laws..................... 845

C. Defendants’ RICO Claims Against DLL.............................. 845

1. Elements of a RICO Claim .................................... 846

2. Defendants Fail to Establish the Requisite Elements of Their RICO Counterclaims Against DLL................................. 846

VI. Conclusion ......................... 849

Plaintiff De Lage Landen Financial Services, Inc. (hereinafter “Plaintiff’ or “DLL”) has moved for summary judgment pursuant to Fed.R.Civ.P. 56 on its sole claim in this case, for breach of contract, against Defendants Rasa Floors & Carpet Cleaning, LLC (“Rasa”); Viewpoint Computer Animation, Inc. (“Viewpoint”); and third-party Defendant Northcentral Communications, Corp. (“NCC”) (hereinafter collectively “Defendants”) (ECF Nos. 189, 191 in C.A. 08-533; 171 in C.A. 08-534), and on Defendants’ Counterclaims against DLL. There has been extensive briefing and oral argument on the parties’ claims, and related issues.

The contracts between DLL and Defendants each state that Pennsylvania law will control and the Court has determined that Pennsylvania law will govern DLL’s claims. After review of the briefs and other filings accompanying the parties’ motions and cross motions, the Court concluded DLL was entitled to summary judgment in its favor as to its claims and entered an Order to this effect on June 24, 2011 (ECF No. 259 in C.A. 08-533; 229 in C.A. 08-534). Denial of Defendants’ Cross Motions for Summary Judgment was subsumed in the entry of summary judgment in favor of DLL. This Memorandum will explain the reasons for the Order. This Memorandum will additionally address DLL’s Motions for Summary Judgment as to Defendants’ counterclaims against DLL and will grant summary judgment in favor of DLL on Defendants’ counterclaims against DLL.

I. Factual and Procedural History

A. Background

The parties are familiar with the lengthy factual and procedural background of this case and thus, the Court briefly restates only those facts relevant to the summary judgment motions. The Court held hearings and made relevant findings of fact in conjunction with Defendants’ Motions for Class Certification. The Court’s August 20, 2010 Memorandum denying Defendants’ class motions described the nature of the contracts at issue as follows:

Under its “Power of $Zero” (“POZ”) program, the now-defunct Capital 4[, Inc. (“Capital 4”) ] offered telephone and internet services to business customers for a set monthly fee, and for a fixed period of time. In addition to receiving telephone and internet services provided by Capital 4, customers had the option of receiving either (1) networking and telephone equipment, (2) a cash rebate, or (3) a combination of equipment and a partial cash rebate. At some point after Capital 4’s POZ program was up and running, 3Com [Corporation (“3Com”) ] became aware of and interested in the program. Beginning in 2005, Capital 4 and 3Com entered into a series of contractual agreements defining their roles respecting the POZ agreement, in which, among various contractual obligations, Capital 4 would provide customers with 3Com networking and telephone equipment. To finance the cost of the equipment and/or cash rebates, Capital 4 arranged with financial institutions to act as funding sources for Capital 4 customers. 5/5/10 Hr’g Tr., Testimony of 'Steven Majer, Jr., 14-15, 27-29. DLL was one of these such lenders. 5/4/10 Hr’g Tr., Testimony of Douglas Cunningham, 57-58. Thus, under the POZ program, POZ customers entered into two separate contracts: (1) a POZ Customer Agreement with Capital 4 (“POZ Customer Agreement”), and (2) an equipment lease or rental agreement with a leasing company such as DLL (“Lease Agreement”) which was referred to in the POZ Customer Agreement as a “Funding Agreement.” DLL and 3Com’s Joint Post-Hearing Br. 4.

De Lage Landen Fin. Servs., Inc. v. Rasa Floors, LP, 269 F.R.D. 445, 454 (E.D.Pa. 2010) (Baylson, J.).

As noted above, DLL entered into two different types of agreements. DLL and Capital 4 entered into a Business Communications Program Agreement (“Program Agreement”), which outlined DLL’s and Capital 4’s roles as lender/lessor and vendor, respectively. Plaintiffs Appendix to Statement of Undisputed Facts, Ex. D. The Program Agreement stated that lease agreements could include “Soft Costs” such as service, maintenance, installation, delivery, software, and training associated with leased equipment, and that DLL would fund Capital 4 for service and maintenance quarterly or monthly, less DLL’s administrative fee. Pl.’s App. to Statement of Undisputed Facts, Ex. D at ¶ A(8).

DLL’s separate Lease Agreements with customers specified that DLL had no responsibility for service or maintenance related to leased equipment, but that lease payments could “INCLUDE THE COST OF MAINTENANCE AND/OR SERVICE BEING PROVIDED BY THE SUPPLIER AND/OR MANUFACTURER!.]” App. Ex. C at § 7. Thus, “[e]ach customer’s monthly fee was apportioned to the lender for the lease payment on equipment, and to Capital 4 for the telephone and internet services.” De Lage Landen Financial Services, Inc., 269 F.R.D. at 454 (citing 5/5/10 Hr’g Tr., Majer, 32-33).

■ DLL originally filed suit in two separate cases against two separate Defendants, Viewpoint and' Rasa, for breach of contract and unjust enrichment on February 2, 2008. Id. at 449. Defendants brought several counterclaims against DLL' and brought third party claims against 3Com and Capital 4. Id. The cases were consolidated for purposes of discovery on April 14, 2009. Id. With leave granted by the Court, DLL filed a third-party complaint against NCC on October 5, 2009 (ECF No. 105 in C.A. 08-533). The Court has issued decisions on several motions to dismiss during this period, resulting in the narrowing of claims and counterclaims. See De Lage Landen Financial Services, Inc., 269 F.R.D. at 449-51.

On March 24, 2011, following substantial discovery, DLL filed Motions for Summary Judgment on its breach of contract claims against Rasa, Viewpoint, and NCC and on Defendants’ counterclaims (ECF Nos. 189, 191 in C.A. 08-533; 171 in C.A. 08-534). Defendants filed responsive briefs on May 16, 2011 (ECF Nos. 222, 225 in C.A. 08-533; 205 in C.A. 08-534). Defendants’ responses included cross motions for summary judgment, but their initial briefing was limited to DLL’s claims, pursuant to this Court’s Order of April 15, 2011, 2011 WL 1465565 (ECF No. 211 in C.A. 08-533; 189 in C.A. 08-534). DLL filed a Consolidated Reply Brief on May 31, 2011 (ECF No. 240 in C.A. 08-533; 211 in C.A. 08-534).

Pursuant to this Court’s procedures on summary judgment motions, DLL’s Motions for Summary Judgment are accompanied by multi-paragraph Statements of Undisputed Facts (ECF Nos. 190, 192 in C.A. 08-533; 172 in C.A. 08-534). Although Defendants have each filed counter-statements asserting that many of these facts are disputed, these “disputes” are really in the nature of legal arguments rather than factual disputes (ECF Nos. 222, 225 in C.A. 08-533; 204 in C.A. OS-534). Furthermore, the Court finds significant that, in filing Cross-Motions for Summary Judgment on Contract Claims, Defendants each state that there is “no genuine issue of material fact on the defenses raised by [Defendants] to the contract claims of DLL, and [Defendants are] entitled a judgment as a matter of law.” ECF Nos. 222 at 2, 225 at 2 in C.A. OS-533; 205 at 2 in C.A. 08-534. The Court will accept DLL’s facts as undisputed as the record will show that none of the asserted “disputes” are “genuine.”

B. Rasa Floors

In support of its Motion for Summary Judgment, DLL filed a Statement of Undisputed Facts consisting of 63 paragraphs and supported by a number of exhibits (ECF No. 190 in C.A. 08-533). Paragraphs 1 through 7 describe the relationship between DLL and Capital 4, which are two separate companies. Paragraphs 8 through 18 describe the POZ Program and the manner by which Capital 4 used its network of VARs to sell the program and several different financial institutions, such as DLL, as funding sources.

Rasa is in the business of selling and cleaning carpets in Texas. 5/4/10 Hr’g Tr., Testimony of Michael Rasa, 66. The business has offices in approximately seven locations, about 150 employees, and $50,000,000 in annual revenue. Michael Rasa Dep. at 13-14, 67. Michael D. Rasa (“Mr. Rasa”) is the principal and Chief Executive Officer of Rasa. Id. at 13. Rasa was introduced to the POZ program by Douglas Cunningham (“Mr. Cunningham”), the president and owner of NGC, which was also a POZ VAR. 5/4/10 Hr’g Tr., Rasa, 67, 82. Prior to entering into the POZ program, Mr. Rasa met once with Mr. Cunningham, for not more than 20 or 30 minutes. Rasa Dep. 22, Mar. 11, 2010. Rasa entered an agreement to participate in the POZ Program through a POZ Customer Agreement with Capital 4 on December 5, 2005, choosing to receive a cash rebate rather than receiving new telephone equipment. Statement of Undisputed Facts and Rasa’s Resp. at ¶ 16-18; PL’s App. Ex. G. DLL is not named as a party to the Customer Agreement. Id. On December 6, 2005, Mr. Rasa signed a document entitled “Rental Agreement,” to which DLL is also a party. Rasa Dep. 33. There is no dispute that Mr. Rasa signed the Rental Agreement, has admitted that he had failed to read it, and has stated that if he had read it, he would not have signed it. 5/4/10 Hr’g Tr., Rasa, 70, 88.

Paragraphs 19 through 30 describe the agreement entered into between DLL and Rasa. Through the Rental Agreement, DLL agreed to rent to Rasa one Intertel Telephone System and two hundred business telephones, PL’s App. Ex. C. at 1, equipment which Rasa had previously rented from Intertel. Statement of Undisputed Facts and Rasa’s Resp. at ¶ 17.

Section 2 of the Rental Agreement states, in part, that Rasa’s “obligation to pay the Rental Payments and other Rental Agreement obligations is absolute and unconditional and is not subject to cancellation, reduction, setoff or counterclaim” and specifies the Agreement to be “NONCANCELLABLE.” Id. at ¶2. Section 5 expressly disclaims any warranties as to the fitness or merchantability of the equipment, stating that Rasa’s “OBLIGATION TO PAY IN FULL ANY AMOUNT DUE UNDER THE RENTAL AGREEMENT WILL NOT BE AFFECTED BY ANY DISPUTE, CLAIM, COUNTERCLAIM, DEFENSE OR OTHER RIGHT WHICH YOU [Rasa] MAY HAVE OR ASSERT AGAINST THE SUPPLIER OR THE EQUIPMENT MANUFACTURER.” Id. at ¶ 5. Further, Section 7 of the Rental Agreement provides that

IN THE EVENT THE RENTAL PAYMENTS INCLUDE THE COST OF MAINTENANCE AND/OR SERVICE BEING PROVIDED BY THE SUPPLIER AND/OR THE MANUFACTURER, YOU [Rasa] ACKNOWLEDGE THAT WE [DLL] ARE NOT RESPONSIBLE FOR PROVIDING ANY REQUIRED MAINTENANCE AND/OR SERVICE FOR THE EQUIPMENT. YOU [Rasa] WILL MAKE ALL CLAIMS FOR SERVICE AND/OR MAINTENANCE SOLELY TO THE SUPPLIER AND/OR MANUFACTURER AND SUCH CLAIMS WILL NOT AFFECT YOUR [Rasa’s] OBLIGATION TO MAKE ALL REQUIRED RENTAL PAYMENTS.

Id. at ¶ 7.

Section 14 of the Rental Agreement states, inter alia, that Rasa is in default if Rasa “fail[s] to pay any Rental Payment or other sum when due.” Id. at ¶ 14. Section 15 defines the available remedies to DLL. Id. at ¶ 15.

Section 21 of the Rental Agreement states that Rasa “agrees that this Rental Agreement is a Finance Lease as that term is defined in Article 2A of the Uniform Commercial Code (“UCC”).” Id. at ¶ 21.

Section 22 of the Rental Agreement between Rasa and DLL, entitled “Choice of Law” states, in relevant part,

This Rental Agreement shall in all respects be interpreted and all transactions subject to this Rental Agreement and all rights and liabilities of the parties under the Rental Agreement shall be determined and governed as to their validity, interpretation, enforcement and effect by the laws of the Commonwealth of Pennsylvania except for local filing requirements.

Pl.’s App. Ex. C at ¶ 22.

Section 23 states “This Rental Agreement contains the entire agreement and understanding.”

Above Mr. Rasa’s signature, dated December 5, 2005, the Agreement states ‘You [Rasa] acknowledge that the Equipment shown above has been received, has been put in use, is in good working order, and is satisfactory and acceptable.” PL’s App. Ex. C.

The facts are undisputed that Rasa did not have any direct contact with DLL in signing the contract with DLL, but all of the discussions and negotiations took place through the Capital 4 VAR. Statement of Undisputed Facts and Rasa’s Resp. at ¶ 51. However, while the document is “co-branded” with the names of Capital 4 and DLL, Capital 4 is not named as a party or signatory to the Rental Agreement. Statement of Undisputed Facts and Rasa’s Resp. at ¶ 21, PL’s App. Ex. C.

Paragraphs 31 through 44 describe DLL’s funding of the Rental Agreement, Capital 4’s insolvency as of September 2007, the company’s resulting cessation of telephone and internet services, and Rasa’s payment default. There is no dispute that DLL reduced Rasa’s Rental Payments as of October 2007, to eliminate the portion of the fee paid to Capital 4 for telephone services, and that Rasa failed to pay DLL as of October 7, 2007. Statement of Undisputed Facts and Rasa’s Resp. at ¶ 38-39.

Paragraphs 45 to 63 relate to the Rasa counterclaims against DLL, addressed below. Mr. Rasa’s interest in the POZ program was to obtain a single bill for telephone and internet services with a locked-in price for the full term of the contract. Statement of Undisputed Facts and Rasa’s Resp. at ¶ 49. Mr. Rasa believed, based on his conversation with Mr. Cunningham, that if Capital 4 stopped providing telephone and internet services, Rasa could terminate its involvement with the POZ program without penalty or further obligation to anyone. Id. at ¶ 59; Rasa Dep. at 116. There is no dispute that, given Mr. Rasa’s failure to read the Rental Agreement, Mr. Rasa did not realize that the Rental Agreement involved a lease of Rasa’s existing Intertel telephone system. Id. at ¶ 58. Mr. Rasa acknowledged in his deposition that, had he read the agreement, he would have understood that he was agreeing to rent his company’s current system from DLL. Id.; Rasa Dep. at 117. Mr. Rasa further acknowledged that, had he understood the terms of the contract, he would not have signed it. Rasa Dep. 43,117.

DLL filed this cause of action for breach of contract against Rasa on February 1, 2008. ECF No. 1 in C.A. 08-533.

C. Viewpoint

The discussion concerning Viewpoint requires little in addition to the discussion above relating to Rasa. Viewpoint is a firm headquartered in Needham, Massachusetts, that creates on-air promotions for cable network series. Matthew Kelley Dep. at 13. As with Rasa, Viewpoint was introduced to DLL and Capital 4 by a third-party VAR, Technology Asset Services (“TAS”). De Lage Landen Fin., Servs., Inc., 269 F.R.D. at 454; 5/4/10 Hr’g Tr., Testimony of Matthew Kelley, 210. Viewpoint’s controller, Matthew Kelley, read the agreements several times before advising the company’s president, Carlo DiPersio, who made the decision that Viewpoint would join the POZ program. Id.; 5/4/10 Hr’g Tr., Kelley, 211, 220-21, 227; PL’s App. Ex. C.

As a result of these discussions, Viewpoint entered into a POZ Customer Agreement with Capital 4 that is undated. PL’s App. Ex. G. Viewpoint selected the equipment option of the POZ Program and received the equipment listed in the Lease Agreement as two telephone systems, 56 business telephones, and two chassis. 5/4/10 Hr’g Tr., Kelley at 205; Kelley Dep. at 90. DLL and Viewpoint signed an agreement, entitled “Business Communications Lease Agreement” (“Lease Agreement”), identical in all material terms to the agreement between DLL and Rasa, on October 12, 2005. PL’s App. Ex. C at 1. There is no evidence in the record of any discussions directly between Viewpoint and DLL in conjunction with entering into the Lease Agreement.

A “primary catalyst” for Viewpoint’s conversations with the Capital 4 VAR regarding the POZ program was Viewpoint’s interest in obtaining new telephone equipment. 5/4/10 Tr. at 216; Kelley Dep. at 21. Viewpoint received the leased equipment, and, as of the date of the Class Certification Hearing, the company still possesses the equipment. Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 17. However, Viewpoint believed that it was getting the telephone equipment “for free,” although the company had entered into equipment leases prior to its agreement with DLL and has acknowledged that the Lease Agreement with DLL looked similar to those prior leases. Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 59. Mr. Kelley read the Customer and Lease Agreements prior to signing, and he testified in his deposition that he thought DLL was helping to provide telephone and internet services and that the Lease Agreement related to payments for services. Kelley Dep. at 35.

It is undisputed that Viewpoint made payments to DLL through December 2007. Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 35. As discussed above, Capital 4 ceased providing services as of October 2007 and DLL reduced the rental payments to eliminate payment for telephone and internet services. Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 35. Viewpoint ceased payment to DLL as of January 2008. Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 38-39.

DLL filed this cause of action for breach of contract against Viewpoint on February 1, 2008. ECF No. 1 in C.A. 08-534.

D. NCC

DLL’s statement of undisputed facts as to NCC, although different on some specifics, follows the same structure as with Rasa, and need not be repeated again.

NCC is a Texas-based business that sells and services business telephone systems. 5/4/10 Hr’g Tr., Cunningham, 8; Cunningham Dep. at 6-7. Mr. Cunningham is the president and part-owner of NCC. Cunningham Dep. at 5; PL’s App. Ex. C. NCC was a POZ VAR for Capital 4 and sold the POZ Program to approximately 56 customers, including Rasa. 5/4/10 Hr’g Tr., Cunningham, 11-15, 35; Cunningham Dep. at 162-63. During NCC’s tenure as a POZ VAR, the company had approximately 22 employees and annual revenues of about $3 million. Cunningham Dep. at 6-7. In addition to serving as a POZ VAR, NCC also participated in the program. NCC entered into a POZ Customer Agreement with Capital 4 on April 1, 2005, electing to receive both a new telephone system and a cash rebate. PL’s App. Ex. G. On April 18, 2005, NCC entered into a lease agreement with DLL, entitled “Business Communications Rental Agreement” (“Least Agreement”), signed by Mr. Cunningham and a representative of DLL. PL’s App. Ex. C. Although the form of the contract between DLL and NCC is slightly different than DLL’s agreements with Rasa and Viewpoint, the contract also specifies that Pennsylvania law will control and remaining terms at issue in this case are essentially the same as in the Rasa and Viewpoint agreements.

NCC was familiar with DLL’s role as an equipment leasing company prior to entering into the NCC Rental Agreement at issue in this case, through NCC’s prior role as a vendor of equipment leased to customers who had obtained funding through finance leases with DLL. Statement of Undisputed Facts and NCC’s Resp. at ¶ 58. However, Mr. Cunningham did not read the NCC Rental Agreement prior to signing it. Statement of Undisputed Facts and NCC’s Resp. at ¶ 63. Mr. Cunningham believed that, if the company did not receive telephone and internet services, NCC would be able to cancel “the whole contract program.” Id. at 65; Cunningham Dep. at 104.

It is undisputed that, subsequent to Capital 4 ceasing to provide telephone and internet services, NCC stopped payments to DLL as of September 2007. Statement of Undisputed Facts and NCC’s Resp. at ¶ 40-42.

II. Legal Standards

A. Summary Judgment

Summary judgment is appropriate if the movant can show “that there is no genuine dispute as to any material fact and that the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A dispute is “genuine” if the evidence is such that a reasonable jury could return a verdict for the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A factual dispute is “material” if it might affect the outcome of the case under governing law. Id.

Where the non-moving party bears the burden of proof on a particular issue at trial, the moving party’s initial burden can be met simply by “pointing out to the district court ... that there is an absence of evidence to support the nonmoving party’s case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Summary judgment is appropriate if the non-moving party fails to rebut by making a factual showing “sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.” Celotex, 477 U.S. at 322, 106 S.Ct. 2548. Under Rule 56, the Court must view the evidence presented on the motion in the light most favorable to the opposing party. Anderson, 477 U.S. at 255, 106 S.Ct. 2505.

B. Choice of Law

A federal court sitting in diversity must apply the choice-of-law rules of the forum state. Berg Chilling Sys. v. Hull Corp., 435 F.3d 455, 462 (3d Cir.2006). Accordingly, Pennsylvania law applies to the choice of law analysis.

Defendants contend that their Lease Agreements with DLL should be read together with the POZ Customer Agreements Defendants entered into with Capital 4 and which contain choice of law provisions stating that Texas law applies, in contradiction with the choice of law provisions in the Lease Agreements.

Pennsylvania has adopted Section 187 of the Restatement (Second) of Conflict of Laws and “Pennsylvania courts generally honor the intent of the contracting parties and enforce choice of law provisions in contracts executed by them.” Gay v. CreditInform, 511 F.3d 369, 389 (3d Cir.2007) (quoting Kruzits v. Okuma Mach. Tool, 40 F.3d 52, 55 (3d Cir.1994)). However, the choice of law analysis is “issue-specific” and the Court must examine whether “different states’ laws ... apply to different issues in a single case.” Atl. Pier Assocs., LLC v. Boardakan Rest. Partners, 647 F.Supp.2d 474, 488 (E.D.Pa.2009) (Robreno, J.) (citing Berg Chilling Sys., 435 F.3d at 462).

Courts of this jurisdiction generally examine the breadth or narrowness of a choice of law provision to determine whether the parties intended a choice of law provision to cover all claims arising out of the parties’ association. Compare Jiffy Lube Int’l, Inc. v. Jiffy Lube, 848 F.Supp. 569, 576 (E.D.Pa.1994) (Van Antwerpen, J.) (determining that a choice of law provision stating that the agreement should be “construed, interpreted and enforced in accordance with the laws of the State of Maryland” did not include tort claims); unth Stone St. Servs., Inc. v. Daniels, No. CIV. A. 00-1904, 2000 WL 1909373 at *4 (E.D.Pa. Dec. 29, 2000) (Padova, J.) (concluding a provision stating that the “ ‘obligations of the parties ... shall be governed, interpreted, construed, and enforced’ in accordance with Pennsylvania law ... contemplate[d] actions relating to the validity of the underlying agreement”); see also In re Allegheny Int’l, Inc., 954 F.2d 167, 178 (3d Cir.1992) (determining that an agreement that a contract was to be “governed by, and construed in accordance with, the laws” covered a fraudulent inducement claim). Pennsylvania courts will not disregard a contractual choice of law provision unless that provision infringes upon strong public policy interests. Kruzits, 40 F.3d at 56.

This Court can discern no reason to ignore the unequivocal choice of law provision in the Lease Agreement and concludes that Pennsylvania contract law applies to DLL’s breach of contract claims. Furthermore, the language of the choice of law provision stating that “the Rental Agreement shall in all respects be interpreted and all transactions subject to this Rental Agreement and all rights and liabilities of the parties under the Rental Agreement shall be determined and governed as to their validity, interpretation, enforcement and effect by the laws of the Commonwealth of Pennsylvania” is a broad provision. PL’s App. Ex. C at § 22. The provision appears to this Court to cover all claims going to the validity of the contract, including Defendants’ counterclaims of fraudulent misrepresentation.

Pennsylvania courts will uphold an express choice of law provision if: “(1) the contract bears a reasonable relationship to the state whose law is chosen to govern” and (2) “application of the chosen law does not violate a ‘strong public policy’ that would otherwise protect a party.” Cottman Transmission Sys., Inc. v. Melody, 869 F.Supp. 1180, 1183 (E.D.Pa.1994) (Joyner, J.). This Court finds that the parties’ choice of Pennsylvania law is reasonable given that DLL’s principle place of business is Pennsylvania. Defendants have advanced no argument that Texas “has a materially greater interest” in the enforceability of the parties’ contracts or that applying Texas law to determine the enforceability or validity of the contracts “would be contrary to a fundamental policy” of Texas law. Gay, 511 F.3d at 390. Thus, this Court will honor the parties’ agreed-upon choice of law.

Defendant’s primary argument in favor of applying Texas law is based on their contention that the Lease and Customer Agreements must be construed together and that the choice of law provision in the Customer Agreement somehow invalidates the contrary provision contained in the Lease Agreement. As discussed below in examining the substance of DLL’s claims, the Court rejects Defendants’ argument that the two contracts are sufficiently interrelated that they should be read together so as to contradict the clear intent of the parties as expressed in the Lease Agreements. Furthermore, Defendants have not offered any further argument in support of this Court finding that either Texas or Massachusetts have a greater interest in protecting businesses located within those states than Pennsylvania does in protecting its own businesses. Id. Nor have Defendants offered any argument that applying the laws of another state would engender a different result as to either DLL’s contract claims or Defendants’ common law counterclaims. Thus, the Court sees no strong public policy counseling against the application of Pennsylvania law in this case.

III. Under Pennsylvania Law, DLL Is Entitled to Summary Judgment that Defendants Breached the Contract Between Defendants and DLL, as a Matter of Law

In its Motions for Summary Judgment, DLL contends that Defendants breached their individual Lease Agreements with DLL by failing to make payments when due without valid excuse or affirmative defense. A breach of contract action involves (1) the existence of a contract, (2) a breach of a duty imposed by the contract, and (3) damages. Sullivan v. Chartwell Inv. Partners, LP, 873 A.2d 710, 716 (Pa.Super.Ct.2005). Defendants have raised counterclaims alleging fraud, which goes to the enforceability of the contract and will be addressed separately below. There is no dispute that each Defendant entered into a Lease Agreement with DLL. Thus, the Court limits its initial discussion to the existence of a breach of a duty imposed by the individual contracts. Defendants have each raised identical defenses of unconscionability, mutual mistake, breach by DLL, and illegality. Rasa has additionally raised a separate defense of mutual mistake on different facts.

A. As a Matter of Law, DLL Has Established that Defendants Breached Their Lease Agreements

Pursuant to 13 Pa.C.S.A. § 1102(b)(1), Pennsylvania adopted the Uniform Commercial Code (“U.C.C.”) to, inter alia, “simplify, clarify and modernize the law governing commercial transactions.” De Lage Landen Fin. Servs., Inc. v. Rozentsvit, 939 A.2d 915, 919 (Pa.Super.Ct.2007). Article 2A of the U.C.C., entitled “Leases,” was adopted in Pennsylvania at 13 Pa. C.S.A. §§ 2A101 et seq. Accordingly, this Court will interpret the parties’ agreements pursuant to the U.C.C., in particular Article 2A.

Under Pennsylvania law, when the court determines a contract to be clear and unambiguous in its terms, the court should construe the contract as a matter of law and summary judgment is appropriate. PSC Info Group v. Lason, Inc., 681 F.Supp.2d 577, 585 (E.D.Pa.2010) (Yohn, J.) (citing Allegheny Int’l v. Allegheny Ludlum Steel Corp., 40 F.3d 1416, 1424 (3d Cir.1994) (applying Pennsylvania law)). Although parties may disagree as to the interpretation of contract provisions, such a dispute will not necessarily render a contract provision ambiguous. Id. (citing Halpin v. LaSalle Univ., 432 Pa.Super. 476, 639 A.2d 37 (1994); Lamar v. Granger, 99 F.Supp. 17 (W.D.Pa.1951)).

Under Pennsylvania law, “when the words are clear and unambiguous the intent is to be discovered only from the express language of the agreement.” PSC Info Group, 681 F.Supp.2d at 585 (quoting Steuart v. McChesney, 498 Pa. 45, 444 A.2d 659, 661 (1982)). “Clear contractual terms that are capable of one reasonable interpretation must be given effect without reference to matters outside the contráete,]” Bohler-Uddeholm Am., Inc. v. Ellwood Group, Inc., 247 F.3d 79, 93 (3d Cir.2001) (quoting Krizovensky v. Krizovensky, 425 Pa.Super. 204, 624 A.2d 638, 642 (1993)), unless a party puts forth evidence capable of demonstrating a latent ambiguity. Id. (citing Mellon Bank, N.A v. Aetna Business Credit, Inc., 619 F.2d 1001, 1013-14 (3d Cir.1980)). “Courts do not assume a contract’s language was chosen carelessly, nor do they assume the parties were ignorant of the meaning of the language employed.” Crawford Cent. Sch. Dist. v. Commonwealth, 585 Pa. 131, 888 A.2d 616, 623 (2005) (citing Murphy v. Duquesne Univ. of the Holy Ghost, 565 Pa. 571, 777 A.2d 418, 429 (2001)). Furthermore, failure to read a contract does not excuse a party from being bound by its terms. Schwartz v. Comcast Corp., 256 Fed.Appx. 515, 520 (3d Cir.2007) (citing Simeone v. Simeone, 525 Pa. 392, 581 A.2d 162, 165 (1990)).

Upon close reading of the plain language of the Lease Agreements and consideration of the Agreements’ structure, the Court finds the terms to be clear and unambiguous. Moreover, the parties do not dispute the terms of the contract dxcept that Defendants argue that certain provisions of the Lease Agreement should be read in light of extrinsic evidence and the Customer Agreements with Capital 4. Statement of Undisputed Facts and Rasa’s Resp. at ¶¶ 19-30. To the extent that Defendants seek to change the meaning of the terms of the Lease Agreements based on the-terms of the Customer Agreements, this Court finds such extrinsic evidence to be barred. Thus, the Court must give effect to the language of the Lease Agreement.

The explicit terms of the contracts clearly state that Defendants are in breach if any company “fail[s] to pay any Rental Payment or other sum when due.” Id. at ¶ 14. It is undisputed that Rasa stopped paying DLL starting on October 7, 2007, and, thus, defaulted on its obligations to DLL under the plain language of the Lease Agreement. Statement of Undisputed Facts and Rasa’s Resp. at ¶¶ 38-39. Viewpoint similarly stopped payment in January 2008 and NCC in September 2007. Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 38-39; Statement of Undisputed Facts and NCC’s Resp. at ¶ 40-42.

Furthermore, the explicit terms of the Lease Agreements, as well as their structures, define these contracts as finance lease transactions governed by Article 2A of the U.C.C., adopted in Pennsylvania as 13 Pa.C.S.A. § 2A103(g). PL’s App. Ex. C at ¶ 21. Finance lease transactions are described in the comments to Section 2A103 as the “product of a three party transaction” in which a supplier “manufactures or supplies the goods pursuant to the lessee’s specification” and the lessor and lessee “enter into a lease or sublease of the goods.” 13 Pa.C.S.A. § 2A103(g), cmt. “Due to the limited function usually performed by the lessor, the lessee looks almost entirely to the supplier for representations, covenants and warranties.” Id.

Section (g) of the comment to 13 Pa. C.S.A. § 2A103(g) states, and Pennsylvania courts have held, that even “[i]f a transaction does not qualify as a finance lease, the parties may achieve the same result by agreement!)]” See De Lage Lauden Fin. Servs., Inc. v. M.B. Mgmt. Co., Inc., 888 A.2d 895, 901 (Pa.Super.Ct.2005) (holding that the “parties in the case sub judice [were] bound by the language” defining the contract to be a finance lease pursuant to U.C.C. Article 2A) (citing GE Capital Corp. v. Natl Tractor Trailer Sch., Inc., 175 Misc.2d 20, 667 N.Y.S.2d 614 (N.Y.Sup.Ct.1997)).

As parties to valid finance lease transactions, Defendants’ payment obligations “under the lease contract [became] irrevocable and independent upon [Defendants’] acceptance of the goods,” pursuant to 13 Pa.C.S.A. § 2A407(a), (b) (2008), which extends “the classic ‘hell or high water’ clause to a finance lease that is not a consumer lease.” 13 Pa.C.S.A. § 2A407(a), (b), cmt. 1; see also C & J Vantage Leasing Co. v. Wolfe, 795 N.W.2d 65, 77 (Iowa 2011) (“If an agreement qualifies as a finance lease under the UCC, an express hell-or-high-water clause is unnecessary because such a provision automatically attaches to a finance lease by statute.”). (citing U.C.C. § 2A-407).

Section 21 of the Lease Agreements explicitly defines each agreement as “Finance Lease.” PL’s App. Ex. C. Sections 5 and 7 of the Lease Agreements, which make payment obligatory and unconditional, disclaim any warranties, and transfer to the lessee any warranties made by the manufacturer, confirm that the Agreements are structured to function as finance leases. Furthermore, consistently with M.B. Management and General Electric Capital, this Court finds Defendants are “bound by the language” of Section 21 of the Lease Agreements agreeing to enter into a finance lease as defined by the U.C.C. Id. at 901.

The terms of the Lease Agreements explicitly reflect Section 2A407(a), (b), stating that Defendants’ “obligation to pay the Rental Payments and other Rental Agreement obligations is absolute and unconditional” and that Defendants’ obligations to pay in full will not be “NOT BE AFFECTED BY ANY DISPUTE, CLAIM, COUNTERCLAIM, DEFENSE OR OTHER RIGHT WHICH YOU [Defendants] MAY HAVE OR ASSERT AGAINST THE SUPPLIER OR THE EQUIPMENT MANUFACTURER.” PL’s App. Ex. C at ¶¶ 2, 5. Thus, notwithstanding its arguments to the contrary, Defendants entered into lease finance transactions with DLL and were obligated to meet their commit-merits under the Lease Agreements regardless of any failure to perform by Capital 4 under the Customer Agreements.

As Defendants failed to pay fees to DLL, Defendants have defaulted on the terms of their contracts with DLL. See De Lage Landen Fin. Servs., Inc. v. Rozentsvit, 939 A.2d 915, 921 (Pa.Super.2007) (lessee, under a finance lease of ultrasound equipment and associated hardware and software, breached contract for refusal to pay due to supplier’s failure to provide software where “payment obligations were ‘absolute, unconditional, and [were] not subject to cancellation, reduction, setoff or counterclaim’ ”); M.B. Mgmt., 888 A.2d at 901 (lessee of copy machine in breach of finance lease for failure to make payments to lessor, where lease obligated lessee to make payments regardless of whether the copier satisfied the lessee’s use requirements and lessee accepted delivery of equipment).

B. Defendants’ Defenses are Unavailing

The Court rejects all of the defenses alleged by Defendants, including unconscionability, mutual mistake, breach by DLL, and illegality. Defendants have failed to show any precedent applying Pennsylvania law which supports the defenses it has asserted to DLL’s claims.

1. Defendants Cannot Establish that the Lease Agreements are Unconscionable

Pursuant to 13 Pa.C.S.A. § 2A108(a), a court may, as a matter of law, refuse to enforce a portion of a lease contract or the contract in its entirety if it finds the contract “or any clause of a lease contract to have been unconscionable at the time it was made.” A court may also fashion “appropriate relief’ when it determines “a lease contract or any clause of a lease contract has been induced by unconscionable conduct.” 13 Pa.C.S.A. § 2A108(b). The Court decides the issue of unconscionability as a matter of law. Todd Heller, Inc. v. UPS, Inc., 754 A.2d 689, 700 (Pa.Super.Ct.2000).

A determination of unconscionability requires a two-fold determination, that “the contractual terms are unreasonably favorable to the drafter,” i.e., substantive unconscionability, “and that there is no meaningful choice on the part of the other party regarding acceptance of the provisions!,]” i.e. procedural unconscionability or “unfair surprise.” Harris v. Green Tree Fin. Corp., 183 F.3d 173, 181 (3d Cir.1999) (citing Bensalem, Twp. v. Int’l Surplus Lines Ins. Co., 38 F.3d 1303, 1312 (3d Cir.1994); Ferguson v. Lakeland Mut. Ins. Co., 408 Pa.Super. 332, 596 A.2d 883, 885 (1991); Bishop v. Washington, 331 Pa.Super. 387, 480 A.2d 1088, 1094 (1984); Germantown Mfg. Co. v. Rawlinson, 341 Pa.Super. 42, 491 A.2d 138, 145-46 (1985)); see also Hopkins v. New Day Fin., 643 F.Supp.2d 704, 716 (E.D.Pa.2009) (Slomsky, J.) (asking, under Pennsylvania law, “whether one of the parties lacked a meaningful choice about whether to accept the provision in question and the challenged provision or contract unreasonably favors the other party to the contract”).

The crux of Defendants’ lengthy unconscionability argument is that no “man in his senses, not under delusion, would” agree to pay the agreed-to amount for the equipment promised in the Lease Agreements and the services provided through the Customer Agreements. Viewpoint’s Resp. Br. at 20. The Third Circuit has stated that a finding of substantive unconscionability requires that the party challenging contractual terms show that they are “unreasonably or grossly favorable to one side and to which the disfavored party does not assent.” Green Tree, 183 F.3d at 181. As the Tenth Circuit has implied in Colorado Interstate Corp. v. CIT Group/Equip. Fin., Inc., 993 F.2d 743, 749 (10th Cir.1993), finance lease transactions are not one-sided transactions, but, rather, assist lessors in securing funding for equipment which “would not otherwise be available.” Furthermore, in each case, Defendants assented to the terms of and signed the Lease Agreements. They are now bound by that act, whether Defendants took the step to read the agreements or not. If Defendants now take issue with the quality of the equipment provided for the price offered, their remedy is not with DLL. Rozentsvit, 939 A.2d at 920 (noting that “[t]he party merely financing the transaction has no control over its manufacture, is not involved in the selection of the product nor in any way makes a representation as to its quality or soundness”) (quoting Nath v. Nat’l Equip. Leasing Corp., 497 Pa. 126, 439 A.2d 633, 636 (1981)).

As to procedural unconscionability, where “a contract provision affects commercial entities with meaningful choices at their disposal, the clause in question will rarely be deemed unconscionable.” Denlinger, Inc. v. Dendler, 415 Pa.Super. 164, 608 A.2d 1061, 1068 (1992) (quoting Vasilis v. Bell of Pennsylvania, 409 Pa.Super. 396, 598 A.2d 52, 54 (1991)). Defendants, each experienced commercial business entities, have produced no basis upon which to conclude that Defendants lacked meaningful choice in entering into their Lease Agreement.

Defendants contend that the terms of the Lease Agreements, which define the contracts as finance lease transactions governed by Article 2A, “effect a material shifting of risk which [Defendants] would not reasonably expect to encounter in contracting for telephone and internet access services.” Viewpoint’s Resp. Br. at 35. This argument is a restatement of Defendants’ mutual mistake defense as it relies on Defendants’ avowed position that Defendants did not know that they were entering into contracts for financing of leased equipment. As discussed below, the Court finds this argument to have no merit. Furthermore, as discussed throughout this opinion, the objected-to terms of Defendants’ Lease Agreements are consistent with terms of Article 2A finance lease transactions, which have been found valid and enforceable by Pennsylvania courts. See Rozentsvit, 939 A.2d at 921; M.B. Mgmt., 888 A.2d at 901.

As the Tenth Circuit has discussed, the enforceability of hell or high water provisions is key to making financing accessible for potential lessors. Colorado Interstate Corp., 993 F.2d at 749. Furthermore, the policy justifications behind imposing unconditional obligations on lessees in finance lease transactions are particularly relevant in industries such as telecommunications “where advances in technology significantly decrease the value of equipment that is quickly becoming obsolete.” Id. (citing In re O.P.M. Leasing Services, Inc., 21 B.R. 993, 1006-07 (Bankr.S.D.N.Y.1982)).

As Defendants have established neither that the terms of the Lease Agreements were unfairly favorable to DLL, nor that Defendants were the victims of unfair surprise or a lack of meaningful choice, this Court finds that Defendants’ unconscionability argument is without merit.

2. Rasa’s Argument Regarding Breach By DLL is Without Merit

Rasa contends that DLL first breached the contract because DLL failed take steps to make certain that (a) Capital 4 used the lease money to purchase Rasa’s used Intertel telephone equipment and (b) Capital 4 delivered title for that equipment to Rasa. Rasa Resp. Br. at 16-17. Enforcing a hell or high water clause contained within a finance lease, the Tenth Circuit rejected a similar argument that a lessee “was deprived of the very item contemplated by the contract” in Colorado Interstate Corp., 993 F.2d at 749. The Tenth Circuit relied on Stewart v. United States Leasing Corp., 702 S.W.2d 288 (Tex.App.1985), in which the Texas Court of Appeals found a vendor who failed to deliver subject of lease agreement was not an agent of the lessor. Stewart, 702 S.W.2d at 290. Without that agency relationship, the Texas court concluded that “any claims regarding the equipment were to be made solely against the vendor.” Id.

Hell or high water clauses are consistently found to be “standard in [commercial] finance leases because the quality of the leased goods is the responsibility of the supplier whose warranties extend through the lease to the lessee.” Info. Leasing Corp. v. Chambers, 152 Ohio App.3d 715, 789 N.E.2d 1155, 1163 (2003); see Wells Fargo Bank, N.A. v. BrooksAmerica Mortg. Corp., 419 F.3d 107, 110 (2d Cir.2005) (“Non-performance by the lessor [in a finance lease] is irrelevant, at least when the lessee was a sophisticated party and the party asserting the right to rental payments is a good-faith assignee.”); Harte-Hanks Direct Marketing/Baltimore, Inc. v. Varilease Tech. Fin. Group, Inc., 299 F.Supp.2d 505, 522 (D.Md.2004) (enforcing hell or high water provision of finance lease against lessee notwithstanding failure of lessor to provide paid-for maintenance services and noting that even parole evidence that parties did not intend lessee “to assume an unconditional duty to pay if the maintenance services ceased” could not overcome clear and unambiguous language of contract). Thus, “the obligation of the lender is fully met when the funds required have been provided.” Rozentsvit, 939 A.2d at 921 (citing Trial Court Opinion, entered June 1, 2007, at 3); see also Lyon Financial Services Inc. v. Woodlake Imaging, LLC, No. Civ. A. 04-CV-334, 2005 WL 331695 at *4-5 (E.D.Pa. Feb. 9, 2005) (Diamond, J.) (“Courts regularly enforce ‘hell or high water’ provisions, particularly in finance lease transactions where the lessor’s only obligation is to provide money.”).

The Lease Agreement between Rasa and DLL reflects an acknowledgment by Mr. Rasa that “the Equipment [that was the subject of the Lease Agreement] ha[d] been received, ha[d] been placed in use, [was] in good working order and [was] satisfactory and acceptable.” Pl.’s App. Ex. C. Having determined that it must enforce the terms of Rasa’s finance lease with DLL, this Court concludes that Rasa cannot overcome the clear and unambiguous terms of the Rental Agreement and any claims Rasa has regarding the delivery and title of the telephone equipment are not the responsibility of DLL.

3. Defendants’ Arguments Regarding Breach By DLL and Mutual Mistake are Without Merit

Defendants each contend that DLL engaged in a breach of contract due to the termination of telephone and internet services. In the alternative, Defendants rely on a defense of mutual mistake, contending that Defendants and DLL believed themselves to be entering into contracts for services.

Notwithstanding the Court’s decision not to allow the pleadings to be amended (over three years after the start of this litigation) to include a defense of mutual mistake, it is clear that the doctrine of “mutual mistake” has no place in this litigation because the doctrine requires that both parties to a contract are mistaken. See Zurich Am. Ins. Co. v. O’Hanlon, 968 A.2d 765, 770 (Pa.Super.Ct.2009) (quoting Holmes v. Lankenau Hosp., 426 Pa.Super. 452, 627 A.2d 763, 767-68 (1993) (“Mutual mistake exists, however, only where both parties to a contract [are] mistaken as to existing facts at the time of execution. Moreover, to obtain reformation of a contract because of mutual mistake, the moving party is required to show the existence of the mutual mistake by evidence that is clear, precise and convincing.”)). Defendants assert that DLL was mistaken that the Lease Agreements were “purely to lease equipment,” but have produced no evidence in support. There is no evidence whatsoever that DLL was mistaken in terms of the obligations of it and its contracting parties.

In the alternative, Defendants argue that Customer and Lease Agreements must be viewed together to explain the payments by DLL to Capital 4 for services. Viewpoint’s Resp. Br. at 37. The Court finds it unnecessary to read the two contracts as one to explain the payments to Capital 4 as DLL’s Lease Agreements specified’ that lease payments could “INCLUDE THE COST OF MAINTENANCE AND/OR SERVICE BEING PROVIDED BY THE SUPPLIER AND/OR MANUFACTURER!.]” Pl.’s App. Ex. C at § 7. Accordingly, as discussed in this Court’s August 10, 2010 Memorandum, “[e]ach customer’s monthly fee was apportioned to the lender for the lease payment on equipment, and to Capital 4 for the telephone and internet services.” De Lage Landen Fin. Servs., Inc., 269 F.R.D. at 454 (citing 5/5/10 Hr’g Tr., Majer, 32-33). It is undisputed that DLL collected those funds for services from Defendants and paid them to Capital 4 and that DLL ceased to do so, reducing charges to Defendants, when Capital 4 stopped providing telephone and internet services. See Statement of Undisputed Facts and Rasa’s Resp. at ¶¶ 38-39; Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 35; Statement of Undisputed Facts and NCC’s Resp. at ¶ 41.

Furthermore, for the Court to construe the Lease Agreements between Defendants and DLL and the Customer Agreements between Defendants and Capital 4 together as one agreement is contrary to the express terms of the contracts and unfounded in Pennsylvania law. Both agreements specify that they are separate and distinct contracts. The POZ Customer Agreement expressly states that “all obligations under any funding agreements are explicitly separate and distinct from this Agreement^]” Pl.’s App. Ex. G at ¶ 9. Similarly, the Lease Agreements state that each contract “contains the entire agreement and understanding.” Pl.’s App. Ex. C at ¶¶23. As Rozentsvit, 939 A.2d at 921, and M.B. Management, 888 A.2d at 901, make clear, Pennsylvania appellate courts have concluded that it is appropriate to interpret a finance lease as an enforceable contract, separate from a supplier’s obligations to a lessee. Even were the contracts to be construed together, nothing in the Customer Agreements would invalidate the “hell or high water” clause contained within the Lease Agreements binding Defendants to perform regardless of any breach by Capital 4 of its obligations under the Customer Agreement.

The Court is unswayed by Defendants’ reliance IFC Credit Corp. v. Burton Indus., 536 F.3d 610 (7th Cir.2008). In IFC Credit, the Seventh Circuit determined, pursuant to Illinois law, that an “Equipment Rental Agreement” containing a “hell or high water” clause and a “Hardware Application” were “executed together” and should be “construed together.” 536 F.3d at 613, 614. IFC Credit is distinguishable in several respects. First, unlike both the Customer and Rental Agreements in this case, neither contract at issue in IFC Credit contained a provision defining either agreement as separate and distinct. Second, the same two parties entered into both the “Equipment Rental Agreement” and the “Hardware Application,” which both covered lease of telecommunications equipment. 536 F.3d at 612. The cases before this Court address Lease Agreements for telephone equipment between DLL and Defendants, PL’s App. Ex. C at 1, and the separate Customer Agreements for the provision of telephone and internet services between Defendants and Capital 4, PL’s App. Ex. G.

Finally, the Hardware Application in IFC Credit contained a condition precedent that specified that the Equipment Rental Application would not be binding until the leased equipment was “mounted in [the defendant’s] phone closet.” Id. at 615. As the supplier failed to perform this condition, “no equipment lease ever existed [and] neither party was bound by the Equipment Rental Agreement’s terms.... [I]t was as if the Equipment Rental Agreement — along with its ‘hell-or-high-water’ and assignment clauses — never existed in the first place.” Id. at 615. Viewpoint and NCC clearly accepted the new telephone equipment leased through the Rental Agreements and Mr. Rasa signed an acknowledgment of receipt and acceptance of his used equipment and has maintained possession of the equipment since prior to Rasa’s entrance into the Lease Agreement. Defendants can point to no provision analogous to the one in IFC Credit within either the Customer or Lease Agreements rendering Defendants’ agreements with DLL null based on nonperformance of service obligations by Capital 4. Thus, this Court must give full effect to the terms of the Lease Agreements, as well as 13 Pa. C.S.A. § 2A407(a), (b), obligating Defendants to perform.

Defendants seek to alter the terms of the Lease Agreements based on language contained in Defendants’ wholly separate agreements with Capital 4 in a manner contrary to the clear and unambiguous terms of the agreement between Defendants and DLL. As stated above, where the Court deems a contracts’ terms clear and unambiguous, the parties are barred from introducing extrinsic evidence to modify those terms, unless a party can present evidence of a latent ambiguity, which Defendants have not done. See Bohler-Uddeholm Am., Inc., 247 F.3d at 93.

4. Defendants’ Arguments Regarding Illegality are Without Merit

Defendants contend that Capital 4 did not seek the proper Massachusetts or Texas licenses and, thus, was not authorized to provide telephone and internet services in the states in which Defendants received services. Rasa’s Resp. Br. at 8-12. According to Defendants, DLL knew that at least a portion of the funds collected from Defendants were for services. Defendants contend that DLL aided Capital 4 in its purportedly illegal venture by “passing through payment for unlicensed telephone services provided by Capital 4.” Id. Defendants argue that under International Aircraft Sales, Inc. v. Betancourt, 582 S.W.2d 632, 635 (Tex.Civ.App.1979), that act was “in furtherance of [an] unlawful object,” rendering the Lease Agreements unenforceable.

Betancourt, 582 S.W.2d at 633-34, addressed a contract between a supplier of electronics components and smugglers of those components for resale in Mexico. The Texas Court of Appeals declared the contract between these parties unenforceable against the smugglers because the suppliers both (1) knew when entering into the contract that the smugglers intended to use the goods for an unlawful purpose and (2) aided the smugglers in their “unlawful design to violate the law.” Id. at 635.

Even if Texas law applied to the enforceability of Defendants’ Lease Agreements, which this Court has determined it does not, Betancourt does not establish the contracts to be unenforceable. Defendants’ argument relies solely on an affidavit by Defendants’ counsel that he was unable to find a service provider certificate of authority issued by the Public Utility Commission (“PUC”) for the State of Texas to Capital 4, Inc., but that the Texas PUC had issued a certificate to Capital 4 Outsourcing, Inc. Defs.’ App. to Resp. to Statement of Undisputed Facts Ex. 13 at ¶ 4. Viewing this fact in the light most favorable to Defendants, the affidavit does not establish that Capital 4 intended to operate without a license. Thus, even if this Court were to agree with Defendants that it must construe the Customer and Lease Agreements together, which it will not do, Defendants have provided no evidence upon which to infer that Capital 4 entered into the Customer Agreements with Defendants or the Program Agreement with DLL with an “unlawful design to violate the law.” Id. at 635. Moreover, even if a reasonable jury could infer from the facts asserted that Capital 4 operated without a license in Texas, Defendants have provided no evidence that DLL knew the status of Capital 4’s authority to provide services when entering into its Program Agreement with Capital 4 or its Lease Agreements with Defendants, or even in the period during which Capital 4 provided telephone and internet services to Defendants.

Defendants also contend the DLL violated so-called federal and state anti-cramming and-slamming laws because a portion of DLL’s bills to Defendants contained charges for telephone and internet services. Rasa Counterclaim Br. at 12-13 (citing 47 U.S.C. § 258; 16 T.A.C. § 26.32; 16 T.A.C. § 26.130); Viewpoint Counterclaim Br. at 12-13 (citing 47 U.S.C. § 258; M.G.L.A. c. 93, §§ 108-113).

The federal anti-slamming law “prohibits telecommunication carriers from making unauthorized changes to the provider of telephone service, i.e., switching the customer to another company’s service without the customer’s permission[.]” AT & T Corp. v. Dataway Inc., 577 F.Supp.2d 1099, 1109 (N.D.Cal.2008) (citing AT & T Corp. v. FCC, 323 F.3d 1081, 1082 (D.C.Cir.2003); see also 47 U.S.C. § 258(a) (2008)). The Texas and Massachusetts anti-slamming laws, 16 T.A.C. § 26.130; M.G.L.A. c. 93, §§ 108-113, provide the same protection by prescribing procedures that telecommunications providers must follow to change a customer’s selection of provider. The Texas anti-cramming law protects customers from unauthorized telecommunications charges by prescribing procedures that telecommunications providers must follow “to obtain and verify customer consent for charges.” 16 T.A.C. § 26.32.

DLL is not a telecommunications carrier, nor is DLL’s conduct the type of conduct that was intended to be regulated by the state and federal statutes cited by Defendants. Defendants have not asserted that DLL subjected Defendants to unauthorized charges or switched Defendants’ providers without their consent. Even had DLL done so, the charges for services that Defendants contend are regulated by the statutes cited are not at issue in this case. It is undisputed that DLL ebminated the charges to Defendants for telephone and internet services and the Pass-Thru payments to Capital 4 when Capital 4 ceased to provide telephone and internet services to Defendants. Statement of Undisputed Facts and Rasa’s Resp. at ¶¶ 38-39; Statement of Undisputed Facts and Viewpoint’s Resp. at ¶ 35; Statement of Undisputed Facts and NCC’s Resp. at ¶ 41. Finally, even had DLL not performed some obligation under the anti-cramming or anti-slamming statutes, that is not a basis upon which to invalidate the Lease Agreements.

Applying Pennsylvania law to Defendants’ arguments regarding Capital 4’s authorization to provide services and DLL’s compliance with state and federal telecommunications statutes, the Court cannot conclude that the Lease Agreements “violate[d] a provision of a statute” or could not “be performed without violation of such a provision!)]” Development Fin. Corp. v. Alpha Hous. & Health Care, 54 F.3d 156, 163 (3d Cir.1995) (quoting American Ass’n of Meat Processors v. Casualty Reciprocal Exch., 527 Pa. 59, 588 A.2d 491, 495 (1991)). DLL and Defendants “entered into a valid contract for a valid purpose!)]” Contractor Industries v. Zerr, 241 Pa.Super. 92, 359 A.2d 803, 807 (1976); “neither the subject matter of the contract, nor its performance, was illegal.” Id. (failure to obtain necessary permits for swimming pool construction resulting in a pool that violated a municipal ordinance was merely a “collateral illegality,” given that the “formation or performance of the contract [wa