Full opinion text
OPINION & ORDER . EDELSTEIN, District Judge: This is a declaratory judgment action instituted by plaintiff commercial lender seeking a determination that it has ho contractual obligation to make two loans to defendant based on alleged oral statements. In their answer to plaintiffs complaint, defendants raise six counterclaims in opposition to plaintiffs cause of action. Plaintiff moves this Court for summary judgment on. their Complaint, and defendant opposes this motion on grounds that triable issues of fact exist on both plaintiffs cause of action and defendant’s counterclaims. For the following reasons, this Court finds that plaintiffs motion should be granted in its entirety. PARTIES Plaintiff Philips Credit Corporation (“Philips” or “PCC”) is “engaged in the business of commercial lending, but only in very limited markets.” (Memorandum of Law of Philips Credit Corporation in Support of Motion for Summary Judgment, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Pltf.Memo”) at 2 (Aug. 1, 1994));. see, (Complaint, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Complaint”) ¶ 5 (April 27, 1990).) PCC is organized under the laws of Delaware, and has its principal place of business in New York, New York. (Complaint ¶ 1);. see (Answer and Counterclaim, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Answer”) ¶ 1 (June 29,1990).) Defendant Regent Health Group, Inc. (“Regent”) is “engaged in the development, ownership and management of medical and surgical hospitals.” (Affidavit of Brent W. Jorgeson, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Jorgeson Aff.”) ¶ 2 (Sept. 29, 1990).) Regent, a Texas corporation headquartered in Austin, Texas, (Regent Health Group Inc.’s Memorandum of Law in Opposition to Philips Credit Corporation’s Second Motion for Summary Judgment, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Dfts.Memo”) at 2 (Sept. 28, 1994)), was formed in August 1988 by Brent W. Jorgeson (“Jorgeson”). (Jorge-son Aff. ¶3.) Jorgeson has served as Regent’s Chairman and President since its founding. Id. ¶ 1. Defendant Sugar Mill Point Medical Center, Ltd. (“Sugar Mill” or “SMPMC”) was intended by Regent to be formed as a Texas limited partnership for the purpose of acquiring property in Houma, Louisiana, and constructing a hospital to be known as the Sugar Mill Point Medical Center. (Dfts.Memo at 9-10 & n. 11); (Pltf.Memo at 3); (Jorgeson Aff. ¶ 9.) The SMPMC project “was initiated by several physicians in the Houma area, including Dr. Barry Shelby, M.D. (“Shelby”), because [they] saw a need for a hospital in order to serve adequately the needs of their patients.” (Dfts.Memo at 15.) Approximately twenty local physicians in the Houma area “committed to invest a total of approximately $1 million as limited partners as part of the equity for the project.” (Dfts.Memo at 10.) According to Regent, “[a]ll elements of the SMPMC financing ... were planned to close concurrently with the closing of a loan from PCC.” Id. Because “there was no closing on the PCC loan,” however, SMPMC was never formed. Id.; (Jorgeson Aff. ¶ 9); see (Pltf.Memo at 3^1.) PRIOR PROCEEDINGS Plaintiff commenced this diversity action in April 1990, seeking “a judgment declaring that there exists no valid, enforceable contractual obligation” between plaintiff and defendants. (Complaint, ¶¶ 4,17.) Defendants filed an Answer containing six counterclaims on July 29, 1990. (Answer.) On August 17, 1990, prior to discovery, PCC moved for summary judgment on its complaint on the grounds that no triable issue of fact existed regarding the lack of contractual obligations between the parties. (Pltf.Memo at 15.) On November 12, 1991, this Court denied PCC’s motion for two reasons: (1) the parties had not had opportunity to conduct discovery; and (2) genuine issues of material fact existed regarding several elements of both plaintiffs claim and defendants’ counterclaims. Order, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“November Order”) at 1-2 (Nov. 12,1991). Following discovery, plaintiff requested this Court’s permission to file a second motion for summary judgment pursuant to Federal Rule of Civil Procedure 56 (“Rule 56”). This Court granted plaintiffs request, (Pltf.Memo at 1); (Dfts.Memo at 7), and the instant motion was filed on August 22, 1994. (Notice of Motion, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (Aug. 22,1994) (“Notice of Motion”).) FACTS The facts underlying plaintiffs motion are lengthy, detailed, and consist of numerous pieces of correspondence between the parties. For organizational purposes, this Court will recite the facts chronologically, in five parts: (1) defendants’ preliminary financing efforts; (2) PCC and Regents’ negotiations prior to the issuance of commitment letters; (3) PCC’s first commitment letter; (4) events subsequent to the issuance of PCC’s first commitment letter; and (5) PCC’s second commitment letter. I. Defendant’s Preliminary Financing Efforts In 1989, Shelby initiated a meeting with Jorgeson regarding the possibility of building a new hospital in Houma, SMPMC. (Deposition of Dr. Barry Shelby, M.D., Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Shelby Dep.”) at 7 (Mar. 26, 1993)); (Dfts.Memo at 15-16.) Jorgeson and Regent then prepared a financial plan for the development of SMPMC. (Jorgeson Aff. ¶ 15); (Dfts.Memo at 15.) Health Finance Corporation (“HFC”), an investment banking firm headquartered in Houston, Texas, “issued a commitment to provide $5 million to finance the purchase of medical equipment for SMPMC.” (Jorgeson Aff. ¶ 15); (Dfts.Memo at 14-16.) In addition, by June 1989, approximately twenty Houma-area physicians had committed to invest a total of approximately $1 million as limited partners of the project. (Jorgeson Aff. ¶ 15); (Dfts.Memo at 10.) Also in early 1989, Jorgeson and Regent were introduced to representatives of PCC as a result of the efforts of Veech Canon & Associates (“VCA”), a financial consulting firm specializing in the development of radiology/imaging departments for hospitals. (Jorgeson Aff. ¶ 16); (Dfts.Memo at 16); (Pltf.Memo at 4.) In May 1989, Jorgeson, Patrick McKinney (“McKinney”), a national sales manager of PCC, and representatives of VCA and HFC met to discuss whether PCC would be interested in providing all or part of the financing for SMPMC. (Jorgeson Aff. ¶¶ 16-17); (Dfts.Memo at 17); (Pltf.Memo at 4.) At the close of this meeting, McKinney stated that J. Walter Corcoran (“Corcoran”), the President of PCC, would need to make an on-site visit to Houma to investigate the SMPMC plan before a decision could be made by PCC regarding its decision to provide financing for SMPMC. (Jorgeson Aff. ¶ 17); (Dfts.Memo at 17.) On June 13, 1994, Corcoran, McKinney, Jorge-son, representatives of VCA and HFC, and thirteen of the physician partners of the SMPMC project met in Houma to discuss the project (“the June Meeting”). (Jorgeson Aff. ¶ 18); (Dfts.Memo at 17); (Plaintiffs Statement Pursuant to Rule 3(g), Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Pltf. 3(g) Stmt.”) ¶5 (Aug. 1, 1994).) II. PCC and Regents Negotiations Prior to the Issuance of Commitment Letters Following the June Meeting, Corcoran wrote to Jorgeson stating that PCC “is interested in providing you with the financing requirements you may have. However, before formal credit approval can be granted,” PCC required detañed financial information and documentation regarding Regent and the SMPMC project. (Letter from J. Walter Corcoran, President, Philips Credit Corp., to Brent W. Jorgeson, President, Regent Health Group, Inc. (June 21, 1989) (“June 1989 Letter”).) Regent provided PCC the information requested. (Jorgeson Aff. ¶ 19); (Letter from Brent W. Jorgeson, President, Regent Health Group, to J. Walter Corcoran, President, Philips Credit Corp. (July 3, 1989).) On July 7, 1989, Jorgeson and another Regent representative Steven Beñ (“Beñ”) traveñed to PCC’s offices in New York to meet with McKinney “to negotiate the terms and conditions regarding the Sugar Mül transaction in Houma, Louisiana between Regent Health Care and PCC.” (Memorandum to J. Walter Corcoran from W.G. Blieberg (June 29, 1989); (Jorgeson Aff. ¶ 20); (Dfts.Memo at 20.) According to defendants, [b]y the end of the meeting, PCC and Regent had reached agreement on the major terms of the transaction. Mr. McKinney stated, that the terms agreed to during that meeting would be presented to the PCC Credit Committee for approval, and that he and Mr. Corcoran had decided to recommend to the Credit Committee that PCG finance the entire project. Mr. McKinney stated that if the Credit Committee approved the transaction, that would constitute a “formal commitment” by PCC to do the transaction on those terms. (Jorgeson Aff. ¶ 22); see (Dfts.Memo at 20.) Defendants explain that that same day, Jorgeson and Beñ also met with various individuals on PCC’s Credit Committee. (Jorge-son Aff. ¶ 24); (Dfts.Memo at 22.). Jorgeson states that “[a]fter meeting with these individuals, Mr. Mckinney informed Mr. Beñ and me that the project would be submitted to the PCC Credit Committee the foñowing week and that, if approved, PCC would prepare a written document which would reflect the terms of the transaction as approved by the Credit Committee.” (Jorgeson Aff. ¶ 24); see (Dfts.Memo at 22.) Defendants state that on July 13, 1989, PCC’s Credit Committee approved the SMPMC financing. (Jorgeson Aff. ¶ 25); see, (Dfts.Memo at 22-25.) On July 14,1989, Wynn Blieberg (“Blieberg”) telephoned Jorgeson at Regent’s office in Texas to inform Jorgeson that the “the transaction had been approved by the [PCC] Credit Committee on the terms that had been previously discussed with Regent.” (Affidavit of Wynn G. Blieberg, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Blieberg Aff.”) ¶ 6 (Sept. 27, 1990)); see (Dfts.Memo at 25.) Blieberg then orally “set forth the general terms which had been approved by the Credit Committee.” (Blieberg Aff. ¶ 6); see, (Dfts.Memo at 26.) On July 17, 1989, BHeberg “prepared a memorandum setting forth the terms as presented to and approved by the Credit Committee ... on behalf of the Credit Committee.” (Blieberg Aff. ¶ 7); see (Dfts.Memo at 29); (Memorandum from Wynn Blieberg to Sandra Kamem (“Blieberg Memo”) (July 17, 1989).) The Blieberg Memo lists the terms of financing for both the equipment and the mortgage for SMPMC, then instructs the PCC legal department to “prepare a commitment letter for this transaction as soon as possible” for transmission to Jorgeson. Id. at 1-2. The Memo then states that “upon return of the commitment letter, the customer is required to remit” a deposit on the mortgage. Id. at 2. In a letter dated August 8, 1989, Corcoran on behalf of PCC, informed Regent and SMPMC that PCC “[wa]s considering a loan” to SMPMC in the amount of $10,850,000. (Letter from J. Walter Corcoran, President, Philips Credit Corp., to Sugar Mill Point Medical Center, Ltd. c/o Regent Health Group Louisiana, Ltd. (Aug. 8, 1989) (“August 8 Letter”) at 1.) Thé August 8 Letter expressly stated that the loan, “if approved,” was subject to various terms and conditions. Id. Specifically, the August 8 Letter in relevant part provides that: (1) The Loan would be evidenced by a note (“the Note”), and the proceeds of the Loan would be used “to construct a 60-bed medical and surgical hospital” in Sugar Point, Houma, Louisiana. Id. ¶ 1. (2) The Note would bear interest, the interest would be calculated and paid according to a set schedule, and that payments on the Note would be applied first to interest and then to principal allocated in accordance with the Rule of 78’s (the Sum of the Months Digit Method). Id. ¶ 2. (3) All of SMPMC’s obligations to PCC “shall be secured by a first mortgage lien on the Premises and all improvements thereon (“the Mortgage”) and shall be guaranteed by Regent____” Id. ¶ 3. (4) The Loan Agreement, the Note, the Mortgage, and all other documents required by PCC to evidence and secure the Loan “shall contain such terms, conditions, and covenants, financial and otherwise, as PCC shall require to protect its interest, and shall be in form and substance satisfactory to PCC and its counsel.” Id. ¶ 4. (5) PCC’s commitment to SMPMC would be issued “on the basis of all information provided by [SMPMC],” and any misinformation or withholding, of material information “shall, at the option of PCC, void all of PCC’s obligations thereunder.” Id. ¶5. (6) The closing of the Loan transaction “shall be subject to” eighteen separate conditions including “execution and delivery to PCC of all instruments and documents herein contemplated or required to evidence the Loan and grant PCC a valid and perfected lien on the security interest and collateral therefor, all in form and substance satisfactory to PCC and its counsel.” Id¡ ¶ 6 & 6(a). (7) SMPMC would be responsible for paying all fees and expenses incurred in connection with the Loan. Id. ¶ 7. ' The August 8 Letter concluded with the following request: “If the foregoing terms and conditions provide a basis for funding of this project, please call to arrange a meeting in New York where you and the principals of the Borrower may discuss the issues in this letter.” Id. at 3. Defendants explain that after reading the August 8 Letter, Jorgeson telephoned McKinney and Blieberg to point out that the terms set forth in the August 8 Letter “did not accurately set forth the transaction approved by the Credit Committee.” (Dfts.Memo at 32.) According to defendants, McKinney and Blieberg agreed that the August 8 Letter did not reflect the terms approved by PCC’s Credit Committee, attributed these discrepancies to PCC’s legal department’s failure to act consistently with the instructions of the Credit Committee, and stated that the August 8 Letter would be withdrawn and replaced with a correct letter. Id.; (Jorgeson Aff. ¶¶ 31-32.) On August 15, 1989, Jorgeson and Shelby went to PCC’s office in New York to meet with Blieberg, McKinney, and other representatives of PCC. (Dfts.Memo at 34); (Jorgeson Aff. ¶34); (Shelby Aff. ¶5.) According to defendants, McKinney and Blieberg informed Jorgeson and Shelby “that the purpose of the meeting was to educate the PCC legal department as to the nature of the project and the terms of the transaction, as already approved and agreed to, so that the legal department could properly document it.” (Jorgeson Aff. ¶ 34); (Dfts.Memo at 34.) Jorgeson states that PCC representatives “propounded numerous questions to [him] and to Dr. Shelby, which they characterized as due diligence,” necessary to document the transaction in accordance with the terms that had been approved by the President and Credit Committee of PCC. (Jorgeson Aff. ¶ 34.) The next day, August 16, 1989, Jorgeson and Shelby again met with Blieberg and McKinney, as well as with Corcoran and Beth Walman (‘Walman”), PCC’s General Counsel. Id. ¶ 35; (Dfts.Memo at 35.) Defendants contend that Walman continuously questioned Jorgeson and Shelby during the meeting. In response to this questioning, Jorgeson asserts that he stated to Corcoran “that [Regent] expected to be dealing with people at PCC who understood the hospital business; that the transaction had already been negotiated and approved, and that after more than three months of negotiations this was not the time to re-examine and re-negotiate it.” (Jorgeson Aff. ¶ 36.) Walman purportedly responded “that her job was not to re-negotiate the transaction, but only to document it.” Id. Jorgeson states that he then “responded that [Walman] should document the deal as it had already been negotiated and approved by PCC and Regent.” Id. According to Jorgeson, when he spoke again with Walman later that same day, she “was indignant with [Jorgeson] and stated that she had taken [Jorgeson’s] comments personally.” Id. ¶ 37. Immediately following the August 16,1989, meeting, Shelby spoke with Corcoran. (Shelby Aff. ¶ 5); (Dfts.Memo at 38.) According to Shelby, Corcoran reassured Shelby “that PCC intended to finance the SMPMC project, and it was clearly understood that it would be on the terms approved by Mr. Corcoran and the Credit Committee in July, 1989.” (Shelby Aff. ¶ 5); (Dfts.Memo at 38.) Later, Jorgeson apparently met again with Corcoran and Walman, and Corcoran “assured [Jorgeson] that it was his and PCC’s intent to issue a commitment letter to Regent reflecting the terms agreed to between Regent and PCC in July 1989.” (Jorgeson Aff. ¶ 40); (Dfts.Memo at 38.) It is Jorge-son’s testimony that Corcoran then “instructed Ms. Walman to issue such a commitment letter by Friday of that week.” (Jorgeson Aff. ¶ 40); (Dfts.Memo at 38.) III. PCC’s First Commitment Letter In a letter dated August 18, 1989, PCC informed defendants it had approved a loan to defendants in the amount of $10,850,000, subject to ten pages of terms and conditions. (Letter from J. Walter Corcoran, President, Philips Credit Corp., to Sugar Mill Point Medical Center, Ltd. c/o Regent Health Group, Inc. (Aug. 18, 1989) (“August Commitment Letter”).) Among these terms and conditions, PCC included the following: The Loan and the Note shall be secured by a first priority lien on and security interest in all now existing or hereafter acquired assets of Borrower, both tangible and intangible, including but not limited to all accounts receivable, licenses, contract rights, equipment, general intangibles, real property, personal property and all other assets relating to the Hospital. Id. ¶ A.5.A. The Loan Agreement, the Note, the Leases and related agreements, all of which shall be governed by New York law____ Id. ¶ C.l. The execution, acknowledgement (when necessary) and delivery of all documents in connection with this transaction, including but not limited to the Loan Agreement, the Note, the Leases, all security agreements, ... and other related agreements and instruments executed in connection with this transaction shall be in form and substance satisfactory to PCC and its counsel. Id. ¶ C.2. This Commitment shall automatically expire and terminate if (i) PCC has not received the enclosed copy of this letter duly executed and accepted by Borrower within ten (10) days from the date hereof, and (ii) if the transactions referred herein have not closed within ninety (90) days from the date hereof. Id. ¶ C.4. No provision of this Commitment-may be waived, modified or terminated except by written instrument duly executed by a duly authorized officer of PCC. Id. ¶ C.8. On the last page of the August Commitment Letter, PCC provided signature lines for both SMPMC and Regent as follows: ACCEPTED AND AGREED to this _day of_, 1989 SUGAR MILL POINT MEDICAL CENTER, LTD. By: REGENT HEALTH GROUP, INC. its sole general partner —— Title- REGENT HEALTH GROUP, INC., As Guarantor By:........ Title Id. at 10. It is undisputed that neither Regent nor SMPMC executed the August Commitment Letter. (Answer ¶ 9); (Pltf.Memo at 8.) IV. Events Subsequent to the Issuance of PCC’s First Commitment Letter The parties present different versions of some events that immediately followed PC.C’s issuance of the August Commitment Letter. According to defendants, in several respects the [August Commitment Letter] did not reflect the terms of the transaction as they had been agreed to between Regent and PCC in July. Within 15 minutes after receiving [the August Commitment Letter] on August 18, Mr. Jorgeson pointed this out to Mr. Corcoran in person. Mr. Corcoran responded that the commitment letter should reflect the terms agreed to between the parties in July, and that if it did not, it must have just been a drafting error, and that a corrected commitment letter-would be issued reflecting the terms as agreed to in July. The August 18 letter was thus immediately withdrawn by the President of the Company. At the time it was withdrawn, Mr. Corcoran was leaving for a two week -vacation. Since he himself had to sign the commitment letter, it was at that point physically impossible to issue a final commitment letter before another 14 days would pass. Mr. Blieberg, in his deposition, confirmed that the commitment letter was shown as “back” on August 18, 1989, the same day it was issued. (Dfts.Memo at 40.) Plaintiff neither admits that these incidents took place, nor responds to defendants’ recitation of them. See generally (Pltf.Memo); (Reply Memo.) Both plaintiff and defendants agree, however, on the next sequence of events. Beginning in Fall 1989, defendants sought financing for SMPMC from sources other than PCC. According to Jorgeson, defendants discussed the working capital and real estate financing of SMPMC with Sovran Bank in Nashville, Tennessee (“Sovran”). (Deposition of Brent W. Jorgeson, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Jorgeson Dep.”) at 474-75 (Sept. 15, 1992).) Jorgeson testified that defendants met with Sovran as an alternative source of financing “if for some reason, Philips did not perform____” Id. at 476. Samuel W. Chopin, the Sovran representative with whom Jorgeson dealt, corroborates Jorgeson’s efforts to obtain financing through Sovran. (Deposition of Samuel L. Chopin, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Chopin Dep.”) at 60-65 (Aug. 12, 1992).) On September 2, 1989, Jorgeson wrote to Corcoran regarding the August Commitment Letter. (Letter from Brent W. Jorgeson, President, Regent Health Group Inc., to J. Walter Corcoran, President, Philips Credit Corp. (Sept. 2, 1989) (“September 2 Letter”)); (Pltf.Memo at 8-9); (Dfts.Memo at 41 — 42.) In the September 2 Letter, Jorge-son states that Regent is “pleased to have received [PCC’s] letter of August 18, 1989 regarding Philips Credit’s loan commitment for the Sugar Mill Point Medical Center in Houma Louisiana,” and that he “appreciate^] the time that [PCC’s] staff h[as] taken to familiarize [itself] with the project and with our company, and for the time that was spent in drafting the commitment letter.” (September 2 Letter at 1.) Jorgeson continues that “[a]s can be expected with any document of similar length, there are several modifications and clarifications that [Regent] would like to see made in the commitment letter.” Id. Jorgeson then provides approximately five pages of these “modifications and clarifications.” Specifically, Jorgeson and Regent objected to or requested additional information regarding at least seventeen separate items in the August Commitment Letter, including (1) the interest rates, (2) the amortization period, (3) the “Rule of 78’s” methodology, (4) the prepayment penalty calculation, (5) the contingent interest provision, (6) the provision regarding the pledge of the partnership interests in SMPMC, (7) the requirement that the SMPMC partners evidence their commitment to invest additional equity to cover cost overruns and cash flow shortfalls, (8) the commitment fee, (9) estimated costs and expenses, and (10) Regent’s deadline for accepting the commitment. Id. at 1-5; see (Pltf.Memo at 8); (Dfts.Memo at 41.) Jorgeson concluded the September 2 Letter by suggesting that he and Corcoran “discuss the best way to reach clarification and resolution on these issues,” and stating that he “w[ould] be glad to come to New York if that w[ould] expedite the process.” (September 2 Letter at 5.) Jorgeson further opined that he “th[ought] that we are very close to having a financing agreement that is acceptable to both parties and that will result in a successful financing for what will be a successful project.” Id. On September 19, 1989, PCC wrote to Jorgeson requesting additional documentation and information regarding SMPMC, noting that “this information will assist in [PCC’s] evaluation of the overall feasibility of the proposed project.” (Letter from Morrey S. Halfon, Philips Credit Corp., to Brent W. Jorgeson, President, Regent Health Group, Inc. (“Morrey Letter”) at 1 (Sept. 19, 1989).) The Morrey Letter covered almost four pages, and included requests for such information as (1) the service area demographies for the geographic area SMPMC intended to serve, id. at 1, (2) the percentage of potential SMPC patients covered by Medicare, id., (3) whether private insurance coverage, HMOs, and PPOs in the Houma area were expanding, id., (4) profiles on the physicians involved in the SMPMC project, id. at 1-2, (5) reports on the medical providers with whom SMPMC would compete, id. at 2, (6) “a contingency plan for SMPMC should [the existing local hospital] inact [sic] any sanctions against the investing physicians,” id., (7) additional facilities plans, id., (8) information on the average salaries for nurses, technicians, and other professional staff that SMPMC would hire, id. at, 3, (9) detailed financial analysis regarding the expected sources of SMPMC’s revenues, SMPMC’s anticipated growth rate, and its costs and expenses, id., and (10) “a detailed map of the location of SMPMC and the distance to the other hospital [in the area],” as well “a copy of the master plan for the Sugar Mill Point area____” Id. at 4. On September 20, 1989, Shelby, Bell, and Jorgeson again travelled to New York to meet with PCC representatives to discuss the SMPMC project. (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to J. Walter Corcoran, President, Philips Credit Corp. (Sept. 22,1989) (“September 22 Letter”)); (Pltf.Memo at 9.) In a letter addressed to Corcoran following this meeting; Jorgeson stated that he believefd] that within two weeks [Regent and SMPMC] will have almost all of the information [PCC] requested [in the September 2 Letter] and we are confident that it will support the basis for our business plan. Id. at 1. Jorgeson also revealed, however, that “[w]hile we made progress in several areas this week, we also faced new, significant problems raised by Beth Walman.” Id.. These problems included (1) PCC’s prohibition on SMPMC “mak[ing] any cash distributions to partners until half of the principal balance on the loan ha[d] been paid off,” id., and (2) Walman’s desire “to wait to try and reach agreement on other key elements until Philips has had time to ‘process’ the information [defendants] supplied] in response to the [September 2 Letter].” Id. Jorgeson also requested Corcoran’s “immediate, direct, and continuous personal involvement” in the SMPMC negotiations because Corcoran “clearly ha[d] the final decision making authority for [his] company.....” Id. at 2. Jorgeson offered to return to New York for further negotiations, and alternatively, suggested that the parties meet in either New Orleans or Nashville. Id. at 2-3. In a letter dated September 28, 1989, Corcoran responded to Jorgeson’s concerns. (Letter from J. Walter Corcoran, President, Philips Credit Corp., to Brent W. Jorgeson, President, Regent Health Group, Inc. (Sept. 28,1989) (“September 28 Letter”).) Regarding PCC’s prohibition against distributions to partners prior to the prepayment of a significant portion of defendants’ indebtedness to PCC, Corcoran informed Jorgeson “that this issue had been previously discussed with and agreed to by [Corcoran].” Id. Corcoran explained that “[i]t is the position of PCC as a general rule that the equity investment remains until all of PCC’s indebtedness has been repaid otherwise it can hardly be considered equity,” and that the contractual “language restricting payments to investors is part of the ‘boiler plate’ of all our major financing agreements.” Id. As for PCC’s continued due diligence, Corcoran stated that the due diligence, “if successfully concluded, will enable PCC to have more confidence in the economic viability of this project than we are currently able to justify based on the information currently in our possession.” Id. at 2. Corcoran continued: we recognize, and hope you do too that due diligence is a continuing process as a general rule until a transaction is closed, and in this particular transaction would be a continuing process even after a preliminary closing since, in this particular transaction any loan agreement which we might enter into would contain numerous conditions of funding. However, before we go further, I feel it would be useful for you to have resolved the issue [regarding distributions to partners] and for us to obtain and analyze the information that we’ve previously requested. Id, Finally, Corcoran addressed Jorgeson’s characterization of Corcoran’s role in PCC’s decision-making process. Corcoran stated that he was certain that Jorgeson must understand from [his] current work experience and your previous work experience that no successful business enterprise can operate successfully through a single human being and of course, PCC is no different. What this means is that of course as President of this Corporation I have the final decision making authority and have a very positive attitude toward this project, I delegate much of the responsibility for obtaining information and analyzing that information to trusted members of my staff who, are fully capable of functioning in their assigned roles. Id. at 3. Corcoran also addressed Jorgeson’s earlier concern’s regarding the negative attitude toward the SMPMC that Jorgeson claimed to have perceived in some PCC representatives. Corcoran assured Jorgeson that Corcoran had “discussed this transaction at great length with both Ms. Walman and Mr. Halfon and [was] satisfied that neither person had a ‘negative attitude’ towards this transaction, but rather, that both individuals have the normal skepticism of lending officers attempting to make a prudent lending decision.” Id. Finally, Corcoran stressed the need for Jorgeson to cooperate with Walman and other PCC representatives in order to reach “a prudent lending decision.” Id. According, to defendants, “[beginning in September, 1989, PCC retained Deloitte, Haskins & Sells (“DHS”) of Houston, Texas to complete the due diligence process contemplated by the August 18 draft letter. Much of Regent’s time during the months of September, 1989 through January, 1990 was spent complying with due diligence requests propounded by PCC and DHS.” (Dfts.Memo at 43 — 14.) Defendants state that “[t]he demands made by PCC during this time period specifically tracked the closing conditions and other preparations for closing reflected in the August 18 draft letter.” Id. at 45. Defendants allege that their efforts to comply with PCC’s demands forced defendants to “expend[ ] substantial sums of money and several months of man-hours.” Id. In a letter dated November 7,1989, Jorge-son informed Corcoran that Regent “ha[d] made progress in several key areas of the project.” (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to J. Walter Corcoran, President Philips Credit Corporation, at 1 (Nov. 7, 1989) (“November 7 Letter”).) Jorgeson further informed Corcoran that Regent “ha[d] come up with a suggested modification on the handling of distributions that [Regent] [thought] w[ould] meet [PCC’s] need for protecting the security of the loan, while at the same time not penalizing the project’s partners for making the project successful.” Id. Jorgeson spent two pages updating PCC on the SMPMC project’s specifications, id. 1-8, then three pages detailing defendants’ suggested modification of PCC’s terms regarding distributions of the equity contributions of SMPMC’s limited partners. Id. at 3-5. Jorgeson also attached to this letter a “Preliminary Departmental Equipment List” detailing the costs of items necessary to furnish and outfit SMPMC. Id. at 6-9. Two days later, Corcoran responded to Jorgeson’s correspondence, stating that Jorgeson’s proposal regarding equity distributions was “a step in the right direction, but it [was] still generally unacceptable.” (Letter from J. Walter Corcoran, President, Philips Credit Corporation, to Brent W. Jorge-son, President, Regent Health Group, Inc., at 1 (Nov. 9, 1989) (“November 9 Letter”).) Corcoran further advised Jorgeson that PCC had received “the voluminous material which [defendants] prepared in response to [PCC’s] August request and ... [was] sending it to [PCC’s outside] consultants for their immediate review.” Id. Corcoran concluded this letter by stating that no further meeting between the parties was necessary “until [PCC] h[ad] feed back from [its] consultants and [could] hopefully formulate the remaining questions needed to allow [PCC] to make a final decision.” Id. at 2. On December 4, 1989, Jorgeson wrote to Corcoran to complain that Morrey of PCC was not responding to Jorgeson’s phone calls or otherwise being cooperative in dealing with the SMPMC project. (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to J. Walter Corcoran, President, Philips Credit Corp. (Dec. 4, 1989).) On December 12, 1989, Bell, Regent’s Vice-President, sent a letter to a potential investor in the SMPMC project stating that PCC’s funding commitment for the project “is subject to the lender conducting its’ [sic] due diligence.” (Letter from Steven J. Bell, Vice-President, Regent Health Group, Inc., to Dr. Thomas H. Ellender (Dec. 12,1989) (“Bell Letter”).) In January 1990, Jorgeson sent two letters to DHS, PCC’s outside consultants, regarding the SMPMC project. These letters contained information regarding topics such as the composition of the SMPMC limited partners’ medical practices, estimated average revenue and occupancy for SMPMC, and detailed cost projections for the facility’s first three years. These letters spanned seventeen and forty pages respectively. See generally (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to W. Roger Stroud, Senior Manager, The Douglass Group of Deloitte & Touche (Jan. 9, 1990)); (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to W. Roger Stroud, Senior Manager, The Douglass Group of Deloitte & Touche (Jan. 3, 1990).) On January 16, 1990, Jorgeson and Bell met with Blieberg in New Orleans. According to Jorgeson, Blieberg stated during this meeting that Corcoran and PCC still intended to do the SMPMC transaction on the terms agreed to in July 1989, and that if either Corcoran or PCC decided not to do the transaction on those terms, Blieberg would so inform defendants. (Dfts.Memo at 56); (Jorgeson Aff. ¶ 61.) On January 17, 1990, Blieberg and Halfon of PCC, and representatives from DHS and HFC, met with Jorgeson, Bell and other Regent representatives in Houma. (Dfts.Memo at 56-57); (Jorgeson Aff. ¶ 62.) According to defendants, at the conclusion of this meeting, “Halfon stated that what he had seen and heard that day supported the assumptions in the SMPMC business plan,” and Blieberg reiterated “that the PCC Credit Committee had already set the terms of the transaction (i.e., in July, 1989) and that the Credit Committee (including Mr. Corcoran) had decision-making authority in the matter and had already made its decision in July, 1989.” (Dfts.Memo at 57.) Following this meeting, defendants assert that they learned that certain PCC representatives were hostile to Regent and Jorgeson. Id. at 57-58. According to Jorgeson, on February 9, 1990, Blieberg told Regent that a corrected commitment letter would be issued the following week. Id. at 59; (Jorgeson Aff. ¶ 64.) Defendants state that they never received such letter. Jorgeson further asserts that on February 16, 1990, Blieberg again told Regent that a corrected commitment letter would be issued the following week. (Dfts.Memo at 59); (Jorgeson Aff. ¶¶ 65-66.) Defendants proclaim that they were “given no reason to believe that the letter would be anything other then the terms set forth in July, 1989.” (Dfts.Memo at 59.) Defendants allege that on February 27, 1990, Blieberg spoke to Jorgeson, and “Blieberg expressed his frustration that the PCC legal department had still not produced the letter.” Id. That same day, Jorgeson wrote Corcoran to request Corcoran’s “assistance in breaking the log-jam in getting a final commitment letter produced at PCC.” (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to J. Walter Corcoran, President, Philips Credit Corp., at 1 (Feb. 27, 1990) (“February 27 Letter”).) Jorgeson concluded his letter by asking Corcoran to “[p]lease let [Jorgeson] know when [defendants] e[ould] expect to receive the commitment letter.” Id. at 2. Defendants assert that -the following events occurred subsequent to Jorgeson’s February 1990, correspondence. On March 5,1990, Jorgeson called Halfon. (Dfts.Memo at 60.) During this conversation, Halfon allegedly told Jorgeson “that the SMPMC project had been the subject of extensive discussion during PCC’s quarterly sales meeting,” that the SMPMC project “was the type of project that PCC wanted to do more of, and that PCC was therefore instructing its sales personnel on how to evaluate and work up more such projects in the future.” (Jorgeson Aff. ¶ 68.) Halfon further “stated that he was working on the commitment letter,” but “[t]here was no implication ... that the commitment letter would be inconsistent with the terms agreed to in July, 1989.” Id. According to Jorgeson, on March 9, 1990, Halfon again called Jorgeson to discuss the commitment letter. Id. ¶ 69. Jorgeson claims that Halfon “stated that he had removed some of the closing conditions that had been contained in the August 18, 1989 closing letter,” and that there were “a couple of minor changes” that Halfon wanted to review with Jorgeson. Id. Jorgeson states that the only change that Halfon mentioned at this time “was that PCC wanted Regent to pay $50,000 toward the commitment fee at the time of signing the letter (with the balance due at closing).” Id. Jorgeson further avers that Halfon also made two “clarifications of the August 18 letter”: (1) that two banks in Louisiana acceptable to PCC would be established as the banks upon which the physician limited partners could rely to back the portion of their commitments due at closing; and (2) that the equipment lessor could be any equipment lessor satisfactory to both PCC and Regent. Id. Jorgeson next asserts that he spoke frequently with PCC during the week of March 12-16, 1990, and that although PCC told him that the commitment letter would be sent by the end of the week, “[f]urther dells ensued.” Id. ¶ 70. On March 20,. 1990, Jorgeson states that he received a phone call from Walman and Halfon who “indicated for the first time that PCC was contemplating changes in the major terms of the transaction.” Id. ¶71'. According to Jorgeson, following this call, PCC continued to tell Jorgeson that “PCC would get to [the commitment letter] as soon as it could, and PCC proffered numerous excuses for the delay.” Id. According to Shelby, in early April 1990, Shelby called Blieberg “to ask the reasons for the repeated delays by PCC in getting the commitment letter,” and Blieberg “relayed his extreme frustration at the unwillingness of the PCC legal department to issue the letter as had been repeatedly promised by PCC to Regent.” (Shelby Aff. ¶ 10); see (Deposition of Dr. Barry Shelby, Philips Credit Corp. v. Regent Health Group, Inc., 90 Civ. 2838 (“Shelby Dep.”) at 84-86 (March. 26, 1993).) Both Corcoran and Blieberg acknowledge that Blieberg was frustrated with the pace of the SMPMC transaction. (Corcoran Dep. at 109-10.) Defendants further allege that during April 1990, PCC confirmed in writing that it had committed to do the SMPMC project. (Dfts.Memo at 65.) Defendants state that “[a]s recently as April 2,1990, PCC stated to HFC’s auditors in writing, with reference to Sugar Mill Point Medical Center, Ltd./Guarantor Regent Health Group, Inc.” that PCC “had committed funding for the above lease financing transactions as of December 31, 1989 and that the lease financing transactions have taken place during 1990 or will be funded by [PCC] in 1990.” Id. Defendants then claim that “[o]n May 8, 1990 — eleven days after this litigation commenced — the Vice President and Treasurer of PCC, wrote to HFC’s auditors and retracted Mr. Blieberg’s April 2, 1990 letter,” stating that “Blieberg erroneously confirmed certain funding commitments regarding [SMPMC] when in fact no such commitments had ever been made.” Id. at 65-66. On April 2,1990, Jorgeson wrote Corcoran “expressing Regent’s frustration over the unexplained delays in issuing the commitment letter.” (Jorgeson Aff. ¶ 72.) In this letter, Jorgeson stated the following: As things stand now, I believe that we are worse off now than we were nearly two moths ago when we at least thought we would be getting the commitment letter within a week. Now I don’t know when or if we will ever get the letter, I don’t know whom our contact person should be, and I get the feeling that PCC wishes that we would just go away and stop “bothering” you with business. While we have been exceedingly patient during this process of repeatedly raised expectations followed by inaction and broken commitments, our patience has now been consumed. In our opinion, PCC has not dealt .with Regent Health Group and our SMPMC partners in a fair and responsible manner. I must tell you that the apparent disorganization, confusion and misrepresentation emanating from the legal/credit side of PCC involving our project it totally unacceptable, and is causing us significant expense, risk exposure, and opportunity cost. Walter, I honestly believe your intentions to be good, as well as those of many others at PCC; but somehow, those intentions are not translating into action. I also honestly believe that an impartial observer would find PCG’s good faith and veracity as a lender and as a commercial enterprise to be lacking in this transaction. We have believed throughout this process that we could meet the criteria that you set forth for us last summer and fall. We, along with our partners and investors, have diligently worked and spent a large amount of money to meet the criteria. We believe that the criteria have been met. In the process we have eschewed almost all other potential lending sources, believing that we (PCC and Regent) were each working in good faith to accomplish the transaction as set forth last summer and fah. We are now faced with the growing belief among Regent and SMPMC officers, partners, investors and supporters that PCC is now trying to renege on its commitment and thereby kill the project. If that is the case, then we should be so informed in writing. If that is not the case, then we need to set up a meeting immediately to discuss how to move this project forward. (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to J. Walter Corcoran, President, Regent Credit Corp., at 2-3 (April 2,1990) (“April 2 Letter”) (emphasis in original).) V. PCC’s Second Commitment Letter In a letter dated April 12, 1990, PCC informed defendants that PCC was “willing to (i) make a loan” to SMPMC in the amount of $10,850,000, “and (ii) enter into ... lease transactions ... on and subject to the following terms and conditions, including, without limitation, PCC’s completion of its due diligence in connection with the transactions contemplated hereby.” (Letter from Morrey S. Halfon, Vice President, Philips Credit Corp., to Sugar Mill Point Medical Center, Ltd. c/o Regent Health Group, Inc. (April 12, 1990) (“April Commitment Letter”).) As in the August Commitment Letter, the April Commitment Letter included the following terms and conditions: The Loan and the Note shall be secured by a first priority lien on and security interest in all now existing or hereafter acquired assets of Borrower, both tangible and intangible, including but not limited to- all accounts receivable, licenses, contract rights, equipment, general intangibles, real property, personal property and all other assets relating to the Hospital. Id. ¶ A.5-.A. The Loan-Agreement, the Note, the Leases and related agreements, all of which shall be governed by New York law.... Id. ¶ C.l. The execution, acknowledgement (when necessary) and delivery of all documents in connection with this transaction, including, but not limited to the Loan Agreement, the Note, the Leases, all security agreements, ... and other related agreements and instruments executed in connection with this transaction shall be in form and substance satisfactory to PCC and its counsel. Id. ¶ C.2. This Commitment shall automatically expire and terminate if (i) PC'C has not received the enclosed copy of this letter duly executed and accepted by Borrower within ten (10) days from the date hereof, .and (ii) if the transactions referred herein have not closed within ninety (90) days from the date hereof. Id. ¶ C.13. No provision of this Commitment may be waived, modified or terminated except by written instrument duly executed by a duly authorized officer of PCC. Id. ¶ C.9. The April Commitment Letter also contained the following provision: This letter supersedes any and all prior oral or written agreements, communications, representations and discussions between Borrower and PCC. Id. ¶ C.8. On the.last page of the August Commitment Letter, PCC provided signature lines for both SMPMC and Regent as follows: ACCEPTED AND AGREED to this _day of_, 1990 SUGAR MILL POINT MEDICAL CENTER, LTD. By: REGENT HEALTH GROUP, INC. its sole general partner By: - Title REGENT HEALTH GROUP, INC., As Guarantor By: - . Title ■ Id. at 13. Once again, it is undisputed that neither Regent nor SMPMC executed the April Commitment Letter. (Answer ¶ 13); (Pltf.Memo at 14.) In a letter dated April 20, 1990, Jorgeson informed Corcoran that defendants “were very dismayed and disappointed when [they] received [the April Commitment Letter].” (Letter from Brent W. Jorgeson, President, Regent Health Group, Inc., to J. Walter Corcoran, President, Philips Credit Corp., at 1 (April 20, 1990) (“April 20 Letter”).) Jorge-son asserted that the April Commitment Letter “contained numerous material changes from the business points that have been the basis for this transaction since last summer and fall,” several of which “cut right to the heart of the deal” and were “known by [PCC] to have been unacceptable in any such form all along.” Id. Jorgeson listed several of these changes, such as (1) the guarantees required of the limited partners, (2) PCC’s fee, (3) PCC’s interest charges, and (4) PCC’s intention to calculate the floating rate of interest according to the Rule of 78’s, id., and attached an “Amendment” specifically outlining all of its concerns regarding the April Commitment Letter. Id., Amendment. A. Jorgeson next informed Corcoran that defendants “fe[lt] that either (1) Philips has made errors in its April 12th letter which it can upon further review quickly amend, or (2) Philips has materially misrepresented its intentions over the last eleven months.” Id. at 1. In the event that PCC merely had made errors in the April Commitment Letter, defendants were “quite willing to proceed with [PCC] on the project with a loan as set forth in the April 12th Letter after incorporating the Amendment.” Id. at 1-2. Jorgeson then informed Corcoran that if defendants did not “within ten days from the date of this letter receive a commitment from [PCC] that reflects each of the changes required in the Amendment,” then defendants would conclude that PCC had made material misrepresentations to defendants. Id. at 2. “In preparation of such an eventuality,” Jorgeson informed Corcoran that defendants had “asked [their] attorneys to communicate directly with [PCC] regarding [defendants’] position.” Id. at 2. That same day, Regent’s counsel wrote to PCC and threatened to sue PCC unless PCC modified the April Commitment Letter to include the terms that “Philips previously committed to, both orally and in writing, last summer and fall.” (Letter from Rick Triplett, Esq., to J. Walter Corcoran, President, Philips Credit Corp., at 1-2 (April 20, 1990).) In response to this letter, PCC filed suit on April 27, 1990, seeking a declaratory judgment “that there exists no valid, enforceable contractual obligation” between plaintiff and defendants. (Complaint, ¶¶4, 17.) Defendants filed their answer and counterclaim on June 29,1990. (Answer at 35.) DISCUSSION Presently before this Court is plaintiff’s motion for summary judgment. Plaintiff seeks “an order pursuant to Rule 56 of the Federal Rules of Civil Procedure granting the relief set forth in the complaint and dismissing defendants’ counterclaims on the grounds that there are no genuine issues of material fact and plaintiff is entitled to judgment as a matter of law.” (Notice of Motion.) Defendants oppose plaintiff’s motion, and raise the question what substantive law applies to this Court’s resolution of the instant dispute. Because the outcome of this Court’s choice-of-law determination affects this Court’s analysis of the parties’ substantive disputes, this Court will address the choice-of-law issue first before moving on to the parties’ competing claims regarding plaintiffs summary judgment motion. I. Choice of Law To answer the question what law governs this Court’s resolution of the case at bar, this Court must conduct a detailed choice-of-law analysis. Before resolving this question, this Court will review the parties’ respective claims and the governing law on this issue. A The parties’ respective choice-of-law claims. In the papers initially submitted to this Court, plaintiff assumes that New York law applies to the instant case. See generally (PltflMemo.) Defendants, however, contest this issue from the outset. (Dfts.Memo at 72-73.) They state that under federal choice-of-law rules, this Court’s determination of the law applicable to the parties’ dispute is governed by New York law. Id. Defendants explain that “New York courts determine the applicable substantive law by analyzing which state has the most significant interest in governing the particular conduct at issue,” and that “[t]he controlling facts and the policies implicated in this action dictate that the law of Texas should govern the resolution of this dispute.” Id. Defendants provide this Court a laundry list of factors in support of this claim. They state that: (1) defendant Regent is domiciled in Texas; (2) Regent was founded by a Texan, and “[i]ts offices, staff, bank accounts, files and telephone listings are located in Texas”; (3) the misrepresentations upon which defendants’ first through third counterclaims are based “were received in Texas either in person or by mail, fax or telephone”; (4) “the promises upon which the fourth count of the counterclaim (promissory estoppel) is based were received in Texas in writing or by telephone, or were made in New York to Regent’s principles who were Texas domiciliaries”; (5) “[t]he business relationship upon which the sixth count of the counterclaim (tortious interference) is based were formed in the State of Texas”; (6) “the contract upon which the fifth count of the counterclaim is based was negotiated between persons in the States of Texas and New York and contemplated involvement of another Texas lander”; and (7) “[w]hen the transaction was approved by the PCC Credit Committee, its terms were communicated by telephone to Regent in the State of Texas and were accepted by Regent in Texas.” Id. at 72-73. Defendants further expound that: (8) the injury arising out of the parties’ dealings— the financial loss to Regent — was sustained in Texas; (9) Regent’s conduct in reliance upon PCC’s misrepresentations occurred in Texas; (10) “PCC was to loan funds to Regent for disbursement in Texas”; (11) “[bjoth parties partially performed the contract in Texas”; (12) “Regent’s repayments of the Loan were to be made from its offices in Texas”; (13) “[pjivital correspondence in this case was addressed to Regent in Texas”; and (14) when PCC repudiated the contract, “its repudiation was communicated by telephone and by fax to Regent at its offices in Texas.” Id. at 73-74. . Based on these factors, defendants assert that “[t]ort laws are aimed not only at regulating conduct, but at compensating persons who suffer injury,” and therefore, “the state of the injured party’s domicile usually has the most significant relationship to the case.” Id. at 74. Defendants further argue that “[ajpplying New York conflict of law principles to Regent’s eounterclaim[s], Texas clearly has the paramount interest in applying its law. to the issues in dispute, since the consequences of the improper conduct for which Regent seeks legal redress were experience by Regent in Texas.” Id. at 75. According to defendants, “Texas undeniably has the predominant interest in protecting its own citizens from injury caused by tortious and other unlawful conduct, the effects of which occurred in Texas,” and thus Texas law should apply. Id. at 75-76. In the alternative, defendants argue that the choice-of-law issue at least presents questions of material fact that render inappropriate an entry of summary judgment on this issue. Id. at 76. In response to defendants’ claims, plaintiff offers two competing theories on the choice-of-law issue. First, plaintiff states that under New York law, contractual choice-of-law principles “require an initial inquiry into the intent of the parties.as the starting point in determining which state’s law applies to a contract action.” (Reply Memo at 3.) Citing a provision of the New York General Obligations Law, plaintiff contends that “in matters concerning the validity, construction or effect of a contract in New York involving $250,000 or more, such as the contract in dispute here, choice of law provisions designating that New York law shall apply are given binding effect regardless of whether the contract bears a reasonable relation to New York.” Id. Plaintiff states that both draft commitment letters issued by plaintiff to defendants “establish respectively) ] that New York law applies to Defendant’s contract claim,” because “)e]ach of the commitment letters states unequivocally that [t]he loan agreement, note and all related agreements ... shall be governed by New York law.” Id. at 4 (emphasis in original). According to plaintiff, under relevant case law, the parties’ failure to execute these letters does not require a different result. Id. Plaintiff relies for this assertion on Frutico, S.A. de C.V. v. Bankers Trust Co., 833 F.Supp. 288, 296 (S.D.N.Y.1993). Id. Plaintiff explains that in Frutico, “the lender maintained that there was never an agreement reached between the parties in that action.” Id. “Nevertheless,” the court in Frutico “relied on the choice of law provision contained in unexecuted drafts of an alleged loan agreement to determine that the parties intended that New York law would govern the purported agreement.” Id. Consequently, “the court applied New York law and concluded that, as a matter of law, there was no valid contract between the parties.” Id. at 4 — 5. Plaintiff thus concludes that “the fact that the choice of law provision is in unexecuted commitment letters does not preclude this Court from finding that New York law applies to the instant dispute.” Id. at 5. Plaintiff further points out that, although defendants provided numerous and lengthy objections to both commitment letters “they never objected to the New York choice of law provision),] [and] [t]hus it logically follows that Defendants intended that New York would apply to the Alleged. Agreement.” Id. Alternatively, plaintiff submits that even if the choice-of-law provisions in the August and April Commitment Letters are insufficient to establish that New York-law governs the instant dispute, New York law governs this Court’s resolution of the motion at bar under the “paramount interest test.” Id. Plaintiff explains that under the paramount interest test, New York courts faced with contractual choice-of law questions “consider[] the state having the most ‘substantial relationship’ or ‘significant contacts’ with the parties and the contract to determine which state’s law applies.” Id. at 5-6. Plaintiffs assert that “[m]ost, if not all, of the significant contacts regarding the Alleged Agreement occurred in New York,” and that therefore, New York law applies. Id. at 6. Plaintiff enumerates each of the contacts that allegedly support this conclusion. First, plaintiffs state that “all of the face-to-face negotiations regarding the Alleged Agreement were conducted in either New York or Louisiana with one preliminary meeting in Florida.” Id. Plaintiff further declares, and alleges that defendants do not dispute, that no meeting between the parties ever took place in Texas. Id. Second, “the gravamen of Defendants’ contract claim is based on Philips’ ‘approval’ and ‘repudiation’ of the Alleged Agreement — action which allegedly occurred in New York.” Id. Third, “under the terms of the Alleged Agreement, Philips was expected to fund the loan from its principal place of business in New York.” Id. Fourth, plaintiff reports that “Defendants were expected to repay the loan to Philips at its office in New York.” Id. Plaintiff explains that this fact is significant to this Court’s choice-of-law determination because under the Restatement (Second) of Conflict of Laws, [t]he validity of a contract for the repayment of money lent and the rights created thereby are determined in the absence of an effective choice of law by the parties, by the local law of the state where the contract requires that repayment be made____ Id. at 6 (quoting Restatement (Second) of Conflict of Laws § 195 (1971)). Finally, plaintiff asserts that “New York has a strong interest in protecting its position as a national business capital,” and that New York therefore has a “paramount interest” in this lawsuit that necessitates the application of New York law. Id, at 7. B. New York state choice-of-law principles. It is' black-letter law that a federal district court sitting in diversity must apply the substantive- law of the state in which it sits. Erie R.R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 822, 82 L.Ed. 1188 (1938). Because choice-of-law rules are substantive in nature, this Court must apply the choice-of-law rules of the state in which it sits — New York. Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941); Cargill, Inc. v. Charles Kowsky Resources, Inc., 949 F.2d 51, 55 (2d Cir.1991). New York’s choice-of-law rules “require[] application of the law of the state having the most significant contacts with the matter in dispute.” American Centennial Ins. Co. v. Sinkler, 903 F.Supp. 408, 411 (E.D.N.Y.1995); see Auten v. Auten, 308 N.Y. 155, 160, 124 N.E.2d 99 (1954); Restatement (Second) Conflict of Laws, § 188 (1971). This approach “is known as the ‘center of gravity1 or ‘grouping of contacts’ approach.” Sinkler, 903 F.Supp. at 411; see Auten, 308 N.Y. at 160, 124 N.E.2d 99. Under New York law, “[w]hether [a] ease is viewed primarily as a contract dispute or as an action in tort may affect the location of the center of gravity.” Sinkler, 903 F.Supp. at 411. This position is supported by the Restatement (Second) Conflict of Laws (1971) (“the Restatement”). Under the Restatement, “[t]he law of the ’ state chosen by the parties to govern their contractual rights and duties will be applied____” Restatement (Second) Conflict of Laws, § 187. In the absence of a choice of law by the parties, the Restatement sets forth principles which guide a court’s determination of this question. Section 201 of the Restatement declares that absent a contractual choice-of-law provision, . [t]he effect of misrepresentation, duress, undue influence and mistake upon a contract is determined by the law selected by application of the rules §§ 187-188. Restatement (Second) Conflict of Laws, § 201 & cmt. a. Section 1