Citations
- 960 F. Supp. 1216
Full opinion text
OPINION AND ORDER GRANTING DEFENDANT’S MOTIONS FOR SUMMARY JUDGMENT
GADOLA, District Judge.
This case involves a commercial dispute between Allmand Associates, Inc., a Michigan corporation and Hercules Incorporated, a Delaware corporation. The dispute arises out of a relationship founded in 1989, which was abruptly severed in 1993. Presently before this court are three motions for summary judgment filed by defendant Hercules Incorporated. Upon conducting a thorough review of the record in addition to holding oral argument in this matter on January 29, 1997, this court will grant defendants’ motions.
FACTS
Hercules Incorporated (“Hercules”) is the owner, seller, developer and marketer of the METTON® process-a unique operation used to fabricate molded plastic products. The process involves placing two liquid reactants (“METTON® liquid molding resins”) into a molder, where they amalgamate and form a molded product. In an effort to expand its business, Hercules approached Allmand Associates, Inc. (“Allmand”), a fabricator and marketer of molded products such as car and minivan fenders, snowmobile hoods, and automobile instrument panels, with the possibility of using METTON® technology. In particular, Hercules solicited Allmand because it wanted to introduce METTON® to the automotive industry.
In 1989 and 1990, numerous meetings between Allmand’s and Hercules’ representatives took place in order to familiarize Allmand with METTON® and to convince Allmand to sign a license. In fact, by the middle of 1990, Hercules’ representatives were at Allmand on a constant basis in order to persuade them to enter into a contract with Hercules. At these meetings, various representations were made to All-mand by Hercules’ personnel. For instance, Gladstone Trotman, Hercules’ Marketing Development Manager, represented to Nicholas Bogdanos, General Manager at Allmand, that METTON® would enable Allmand to make high volume parts under low pressures and increase its customer base. He also characterized METTON® as an extremely versatile liquid resin that was tougher, lighter, more cost efficient and more flexible in design capability than other engineering compounds and that it had the potential of molding ribs and bosses with a Class A surface and no sinks or indentations. Statements were made by Trotman and Garland Lee, Hercules’ Marketing Manager, that the cycle time for molding with Hercules’ product would be 2.5 to 3.5 minutes, that secondary finishing was not required, that only minimal cleaning would be required and that the parts produced by METTON® would be easily paintable. Also, Hercules’ employees told Allmand employees that METTON® would be compatible with Allmand’s zinc alloy (“Kirksite”) tools. Many of these oral representations were corroborated by sales brochures and cost models prepared by Hercules and given Allmand.
Eventually, on October 11, 1990, Hercules and Allmand entered into two agreements: (1) the Codevelopment Agreement and (2) the General Molder License Agreement (“GML Agreement”). The Codevelopment Agreement was a one-year contract, under which Hercules’ was obligated to provide free of charge, a quantity of METTON® liquid molding resins (not to exceed 12,000 pounds) to be used by Allmand for the production of prototype plastic components. Pursuant to the Codevelopment Agreement, Hercules also promised to provide consulting services and other necessary design and technical assistance to Allmand, including accompanying Allmand on customer calls. The Codevelopment Agreement required Allmand to manufacture components with METTON® and carry out sufficient market research and testing of such components to determine the feasibility of using METTON® in its production process. The Codevelopment Agreement made clear that each party was responsible for the expenses it incurred in fulfilling its duties under the contract, and nothing in said agreement was to “be deemed to constitute the parties as partners, joint venturers, an association or any other type of joint entity.”
The second contract entered into on October 11, 1990 was the GML Agreement. Basically, this contract gave Allmand a nonexclusive license to use METTON® technology and patent rights and also obligated All-mand to purchase its entire requirement of METTON® liquid reactants from Hercules. As consideration, Allmand was to pay an initial royalty fee of $50,000, in addition to 7.5