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Linde, LLC v. Valley Protein, LLC

United States District Court, E.D. California

July 11, 2019

LINDE, LLC, Plaintiff,
VALLEY PROTEIN, LLC, Defendant. VALLEY PROTEIN, LLC, Counter-claimant,
LINDE, LLC, Counter-defendant.


         This matter is before the court on plaintiff and counter-defendant Linde, LLC's (“Linde”) motion for summary judgment, or in the alternative for partial summary judgment, filed on August 7, 2018. (Doc. No. 52.) Defendant and counter-claimant Valley Protein, LLC (“Valley Protein”) filed an opposition on September 4, 2018. (Doc. No. 53.) Linde filed its reply on September 11, 2018. (Doc. No. 58.) On September 18, 2018, the court held a hearing on the motion at which attorney Adam Scott Hamburg appeared for Linde, and attorney Russell K. Ryan appeared for Valley Protein. Having considered the parties' briefing and heard from counsel, the court will grant Linde's motion for summary judgment in part.


         The facts of this case are as follows, and are undisputed except where noted. On January 27, 2011, Linde and Valley Protein entered into a Product Supply Agreement (the “2011 Agreement”), in which Valley Protein agreed to purchase from Linde its requirements for CO2 for its meat processing plant located at 1828 E. Hedges Avenue, Fresno, CA 93703 (the “Plant”). (Doc. No. 52-5 (“UMF”) at ¶ 1.) The 2011 Agreement also contained an Application Equipment, Ancillary Equipment, and Services Term Sheet, wherein Valley Protein agreed to lease a Cryoline (Cryowave) Tunnel 48-30 (the “2011 Freezer”) from Linde (the “2011 Rental Agreement”). (Id. at ¶ 2.) In addition, the 2011 Agreement contained an Application Equipment, Ancillary Equipment, and Services Rider (the “2011 Equipment Rider”), which provided that Valley Protein was obligated to keep the 2011 Freezer clean at all times, and to “maintain the [2011 Freezer] in a good and fully functional condition, in accordance with any written instructions provided by Linde.” (Id.) Further, the 2011 Equipment Rider stated that Valley Protein “is solely responsible for determining the suitability, compatibility, and use of the [2011 Freezer].” (Id.)

         By early 2012, Valley Protein realized that it was not meeting its target conversion rates using the 2011 Freezer.[1] (Id. at ¶ 6.) In addition, by October 1, 2012, Valley Protein's production increased due to additional business it acquired, and there is some evidence that it was unable to fully meet this increased demand due to the 2011 Freezer malfunctioning. (Id. at ¶ 7; Doc. No. 54 (“DMF”) at ¶ 7.) Although it is undisputed that Valley Protein did not lose customers as a result of these malfunctions, Valley Protein contends that “it did lose business.” (DMF at ¶ 7.) In September 2014, Valley Protein was awarded a new contract with Safeway, because of which it sought ways to improve and expand its freezing operations. (UMF at ¶ 8.) To that end, Valley Protein's president Robert Coyle contacted Michael Iannelli, a sales manager employed by Linde, to inquire whether Linde possessed any newer technology or equipment that would permit Valley Protein to increase its production rate and reduce its CO2 consumption. (Doc. No. 52-1 (“Iannelli Decl.”) at ¶ 9; Doc. No. 52-2 at 17-18.) On September 4, 2014, Linde engineer Amanda Guzman contacted Coyle with a questionnaire to enable Linde to identify the appropriate equipment that would suit Valley Protein's needs. (UMF at ¶ 9; Iannelli Decl. at ¶ 11; Doc. No. 52-2 at 20-21.) On September 29, 2014, Coyle returned this questionnaire to Ms. Guzman. (Iannelli Decl. at ¶ 12; Doc. No. 52-2 at 23-31.) According to the questionnaire, Coyle represented to Linde that the “desired production rate” was 3, 500 pounds of poultry per hour. (Iannelli Decl. at ¶ 12; Doc. No. 52-2 at 25-31).

         There is some lack of clarity about what occurred next. Iannelli stated his understanding that Valley Protein originally requested the ability to process 3, 500 pounds of poultry per hour, as indicated in the questionnaire, but “ultimately ended up” increasing that requirement to 5, 000 pounds of poultry per hour. (Doc. No. 57-2 at 12.) In addition, Coyle stated that in October 2014, he received assurances from Ms. Guzman, one of Linde's engineers, that Linde's new equipment would process 5, 000 pounds of poultry per hour. (Doc. No. 56 (“Coyle Decl.”) at ¶ 9.) However, there does not appear to be any evidence that Valley Protein conveyed to Linde that the capability to process 5, 000 pounds of poultry per hour was a requirement in October 2014: Coyle stated that information was not conveyed to Linde until at least November 5. (Doc. No. 52-4 at 19.) In addition, Iannelli stated that he was unaware of this 5, 000-pound requirement as of September or October, implying that he was made aware of it only later. (Doc. No. 57-2 at 12.)

         Effective November 1, 2014, Linde and Valley Protein entered into a new agreement, referred to as the “2014 Agreement.”[2] (UMF at ¶ 11.) The 2014 Agreement included the Product Supply Agreement, which contained the following provisions relevant to this action:

9. Warranty, Sole Remedies, and Limitation of Damages.
. . .
(e) Statute of Limitations. A Party must commence an action for a breach of contract within one year after the action has accrued.
. . .
15. General Provisions.
. . .
(b) Entire Agreement. Each Term Sheet, in conjunction with the terms specified in this document and the related Riders: (1) constitutes a separate contract between the Parties; (2) constitutes all of the terms of the contract between the Parties regarding its subject matter; and (3) supersedes and terminates all previous agreements between the Parties regarding this agreement's subject matter. Any term contained in a delivery document used by Linde, or a purchase order, confirmation, or acknowledgement used by Valley Protein, that conflicts with, is different from, or is additional to, the terms of this agreement is not part of the contract between the parties.

(UMF at ¶ 11; Doc. No. 52-2 at 35, 37-38.) In addition, the 2014 Agreement included an Application Equipment, Ancillary Equipment and Services Term Sheet and accompanying Rider (the “2014 Rental Agreement”), wherein Valley Protein agreed to lease a Spiral Freezer 20-175S from Linde (UMF at ¶ 13; Doc. No. 52-2 at 45-55.) The 2014 Agreement also contained a Bulk Term Sheet and Rider, pursuant to which Valley Protein agreed to purchase its CO2 gas requirements exclusively from Linde. (UMF at ¶ 12; Doc. No. 52-2 at 40-44.) The Bulk Term Sheet also authorized Linde to charge Valley Protein a fuel surcharge for the delivery of the CO2 gas. (UMF at ¶ 12; Doc. No. 52-2 at 43.)

         According to the Coyle Declaration, a few weeks after the 2014 Agreement was executed, Iannelli contacted Coyle and advised him the equipment that served as the core of the 2014 Agreement had been “mis-engineered, ” and was only capable of processing less than 2, 000 pounds of poultry per hour. (Coyle Decl. at ¶ 12.) Iannelli acknowledged that the new equipment was insufficient to meet Valley Protein's needs and asked for a “do-over, ” agreeing to release Valley Protein from the 2014 Agreement. (Id.; Doc. No. 57-2 at 30-31.) According to Coyle, having equipment sufficient to meet its poultry production requirements “was an absolutely essential requirement and the primary and perhaps sole reason Valley Protein entered in the 2014 Agreement.” (Coyle Decl. at ¶ 12.) Linde does not appear to contest this version of events.

         On December 1, 2014, Coyle sent an email to Iannelli, which stated in relevant part that Valley Protein would “like to rescind the contract we signed previously requesting an extension of the contract date and the new equipment, the [2014 Freezer.]” (UMF at ¶ 14; Iannelli Decl. at ¶ 16; Doc. No. 52-2 at 57.) Iannelli responded by email the same day, agreeing to let Valley Protein rescind the 2014 Rental Agreement, but declining to accept Valley Protein's request to rescind the 2014 Agreement as a whole. (UMF at ¶ 15; Iannelli Decl. at ¶ 17.) On December 12, 2014, Valley Protein entered into an Equipment Lease Agreement with Linde's competitor, Air Liquide, for a Spiral Freezer Model MB1-30-0550-09. (UMF at ¶ 17.) Concurrently, Valley Protein also executed a Product Supply Agreement with Air Liquide to obtain CO2 from Air Liquide, despite Iannelli's email to Coyle notifying him that “Linde does not accept [Valley Protein's] request to rescind the contract renewal of the CO2 agreement.” (Id.; Doc. No. 52-2 at 57.) On January 25, 2015, Coyle sent a Termination Notice to Iannelli, wherein Coyle notified Linde that Valley Protein would not be renewing the 2011 Product Supply Agreement. (UMF at ¶ 18; Iannelli Decl. at ¶ 18; Doc. No. 52-2 at 59-60.) In response to Coyle's email, Iannelli again advised Coyle that Linde and Valley Protein had a valid supply agreement for CO2 that was renewed in November 2014, and that according to the terms of that agreement, Valley Protein was obligated to obtain its CO2 from Linde for the term of five years after that date. (UMF at ¶ 19; Iannelli Decl. at ¶¶ 19-20; Doc. No. 52-2 at 59-60.) On February 1, 2016, Valley Protein notified Linde that it would no longer be purchasing its CO2 from Linde. (UMF at ¶ 20; Iannelli Decl. at ¶ 22; Doc. No. 52-2 at 64.)

         In addition to moving for summary judgment as to its own claims, Linde also moves for summary judgment in its favor as to Valley Protein's counter-claims for breach of contract, breach of the covenant of good faith and fair dealing, intentional misrepresentation, negligent misrepresentation, and unfair competition. These allegations center primarily on alleged malfunctioning of the 2011 Freezer. (See Doc. No. 29 at ¶¶ 11-15.) In addition to those allegations, Valley Protein alleges that between mid-2014 and the beginning of 2016, Linde obtained the CO2 delivered to the Plant from its competitor's plant in Pixley, California, as opposed to Richmond, California. (UMF at ¶ 22.) Linde admits that it sometimes improperly billed Valley Protein a surcharge that was based on the transportation of the gas from Richmond to the Plant. (Id.) Valley Protein characterizes this as a breach of the 2011 Agreement (See Doc. No. 53 at 11), while Linde contends that it was “merely an oversight, ” and that Linde subsequently reimbursed Valley Protein for any unwarranted transportation surcharges. (Doc. No. 52 at 17-18.)

         As a result of what Linde contends was Valley Protein's breach of the 2014 Agreement, Linde asserts damages in the form of lost profits totaling $963, 084.00. (UMF at ¶ 23.) Linde also asserts that at the time Valley Protein breached the 2014 Agreement, Valley Protein had a past due balance for CO2 totaling $38, 963.89, and that this amount remains unpaid. (Id. at ¶ 24.)


         Summary judgment is appropriate when the moving party “shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a).

         In summary judgment practice, the moving party “initially bears the burden of proving the absence of a genuine issue of material fact.” In re Oracle Corp. Sec. Litig., 627 F.3d 376, 387 (9th Cir. 2010) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)). The moving party may accomplish this by “citing to particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials” or by showing that such materials “do not establish the absence or presence of a genuine dispute, or that an adverse party cannot produce admissible evidence to support the fact.” Fed.R.Civ.P. 56(c)(1)(A), (B). When the non-moving party bears the burden of proof at trial, as plaintiff does here, “the moving party need only prove that there is an absence of evidence to support the non-moving party's case.” Oracle Corp., 627 F.3d at 387 (citing Celotex, 477 U.S. at 325); see also Fed. R. Civ. P. 56(c)(1)(B). Indeed, summary judgment should be entered, after adequate time for discovery and upon motion, against a party who fails to make a 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. See Celotex, 477 U.S. at 322. “[A] complete failure of proof concerning an essential element of the nonmoving party's case necessarily renders all other facts immaterial.” Id. at 322-23. In such a circumstance, summary judgment should be granted, “so long as whatever is before the district court demonstrates that the standard for the entry of summary judgment . . . is satisfied.” Id. at 323.

         If the moving party meets its initial responsibility, the burden then shifts to the opposing party to establish that a genuine issue as to any material fact actually does exist. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). In attempting to establish the existence of this factual dispute, the opposing party may not rely upon the allegations or denials of its pleadings but is required to tender evidence of specific facts in the form of affidavits or admissible discovery material in support of its contention that the dispute exists. See Fed. R. Civ. P. 56(c)(1); Matsushita, 475 U.S. at 586 n.11; Orr v. Bank of Am., NT & SA, 285 F.3d 764, 773 (9th Cir. 2002) (“A trial court can only consider admissible evidence in ruling on a motion for summary judgment.”). The opposing party must demonstrate that the fact in contention is material, i.e., a fact that might affect the outcome of the suit under the governing law, see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987), and that the dispute is genuine, i.e., the evidence is such that a reasonable jury could return a verdict for the non-moving party, see Anderson, 477 U.S. at 250; Wool v. Tandem Computs. Inc., 818 F.2d 1433, 1436 (9th Cir. 1987).

         In the endeavor to establish the existence of a factual dispute, the opposing party need not establish a material issue of fact conclusively in its favor. It is sufficient that “the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial.” T.W. Elec. Serv., 809 F.2d at 631. Thus, the “purpose of summary judgment is to ‘pierce the pleadings and to assess the proof in order to see whether there is a genuine need for trial.'” Matsushita, 475 U.S. at 587 (citations omitted).

         “In evaluating the evidence to determine whether there is a genuine issue of fact, ” the court draws “all inferences supported by the evidence in favor of the non-moving party.” Walls v. Cent. Contra Costa Cty. Transit Auth., 653 F.3d 963, 966 (9th Cir. 2011). It is the opposing party's obligation to produce a factual predicate from which the inference may be drawn. See Richards v. Nielsen Freight Lines, 602 F.Supp. 1224, 1244-45 (E.D. Cal. 1985), aff'd, 810 F.2d 898, 902 (9th Cir. 1987). Finally, to demonstrate a genuine issue, the opposing party “must do more than simply show that there is some metaphysical doubt as to the material facts. . . . Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no ‘genuine issue for trial.'” Matsushita, 475 U.S. at 587 (citation omitted).

         “‘When as is the case here, the moving party is a plaintiff, he or she must adduce admissible evidence on all matters as to which he or she bears the burden of proof.'” Grimmway Enters., Inc. v. PIC Fresh Glob., Inc., 548 F.Supp.2d 840, 845 (E.D. Cal. 2008) (quoting Zands v. Nelson, 797 F.Supp. 805, 808 (S.D. Cal. 1992)); see also S. Cal. Gas Co. v. City of Santa Ana, 336 F.3d 885, 888 (9th Cir. 2003) (noting that because plaintiffs are “the party with the burden of persuasion at trial, the Gas Company must establish ‘beyond controversy every essential element of its' Contract Clause claim.” (quoting William W. Schwarzer, et al., California Practice Guide: Federal Civil Procedure Before Trial § 14:124-127 (2001))).


         As noted above, Linde moves for summary judgment on all of its causes of action: breach of contract, breach of the implied covenant of good faith and fair dealing, account stated, and goods and services rendered. (Doc. No. 52 at 2-3.) In addition, Linde also moves for summary judgment in its favor on Valley Protein's counter-claims for breach of contract, breach of the covenant of good faith and fair dealing, intentional misrepresentation, negligent misrepresentation and unfair competition, respectively.

         A. Choice of Law

         Before turning to the individual claims at issue, the court first addresses the parties' choice-of-law dispute. Linde filed its motion for summary judgment under California law. (See generally Doc. No. 52.) However, in its opposition, Valley Protein points out that both the 2011 Agreement and the 2014 Agreement specifically provide that New Jersey law “governs all matters pertaining to the validity, construction, and effect” of the Agreements. (Doc. No. 53 at 16-17.) Linde disputes whether New Jersey law applies, but nonetheless devotes much of its reply to rearguing its motion under New Jersey law. (Doc. No. 58 at 6, 8-17.)

         District courts sitting in diversity apply the substantive law of the state in which they sit. Mason & Dixon Intermodal, Inc. v. Lapmaster Int'l LLC, 632 F.3d 1056, 1060 (9th Cir. 2011). In such circumstances, district courts look to the law of the forum state when making choice of law determinations. Hoffman v. Citibank (S. Dakota), N.A., 546 F.3d 1078, 1082 (9th Cir. 2008). In making these determinations, the California Supreme Court has adopted the approach outlined in § 187(2) of the Restatement (Second) of Conflict of Laws. See Nedlloyd Lines B.V. v. Superior Court, 3 Cal.4th 459, 464-66 (1992). Under this rubric, courts are instructed to first determine whether (1) the chosen state has a substantial relationship to the parties or their transaction, or (2) there is any other reasonable basis for the parties' choice of law. Id. at 466. If neither of these tests is met, the inquiry ends, and the court need not enforce the parties' choice of law. Id. However, if one of these tests is satisfied, the court must next determine whether the chosen state's law is contrary to a fundamental policy of California. Id. If there is no such conflict, the court enforces the parties' choice of law. If there is a conflict, the court must determine whether California has a “materially greater interest than the chosen state in the determination of the particular issue.” Id. If California's interest is materially greater, California law applies despite the choice of law provision. Id. The burden of demonstrating the existence of a fundamental policy of California rests with the party opposing application of the choice of law provision, as does the burden of demonstrating that California has a materially greater interest in the outcome of the case than the chosen state. Wash. Mut. Bank, FA v. Superior Court, 24 Cal.4th 906, 917 (2001).

         New Jersey plainly has a substantial relationship to the parties. As alleged in Linde's complaint, Linde is a limited liability company organized under the laws of Delaware with its principal place of business in New Jersey. (Doc. No. 1 at ¶ 1.) Accordingly, for purposes of diversity jurisdiction, Linde is a citizen of New Jersey. (Id.) This is sufficient to establish a substantial relationship between the chosen state and the parties. See Restatement (Second) of Conflict of Laws § 187 cmt. f (Am. Law. Inst. 1971) (finding a substantial relationship where “one of the parties is domiciled or has his principal place of business” in the chosen state).

         Next, the court must determine whether the chosen state's law is contrary to a fundamental policy of California. Neither party has identified any differences between California and New Jersey law that are relevant to this action, and the court is unaware of any “fundamental policies” of California that are implicated by the facts of this case. The burden on this point rests with Linde as the party seeking to apply California law notwithstanding the parties' choice of law provision. See Wash. Mut. Bank, 24 Cal.4th at 917. Because Linde has failed to carry that burden, this court will apply New Jersey law in addressing the breach of contract claims.

         However, to say that New Jersey law applies to the breach of contract claims is not to say that New Jersey law also applies to the remaining claims in this action. On the contrary, courts routinely recognize that a valid choice-of-law provision contained in a contract does not necessarily govern the entire relationship between the parties. “The question of whether [the choice-of-law] clause is ambiguous as to its scope . . . is a question of contract interpretation that in the normal course should be determined pursuant to [the selected forum's law.]” Nedlloyd Lines, 3 Cal.4th at 469 n.7; see also Cannon v. Wells Fargo Bank N.A., 917 F.Supp.2d 1025, 1051 (N.D. Cal. 2013) (examining Florida law, the law specified in the choice-of-law provision, to determine whether a contractual choice-of-law provision covers related tort claims). The court will therefore consult New Jersey law to determine the breadth of the choice-of-law provisions here.

         The parties have provided no briefing on this issue-indeed, plaintiff Linde did not recognize the existence of a choice-of-law issue in seeking summary judgment under California law despite the existence of the New Jersey choice-of-law provision. However, the court's research has revealed some, albeit limited, authority addressing how New Jersey law would apply to the provision at issue here. After conducting a thorough survey of the relevant law, a New Jersey district court recently concluded that “New Jersey principles of statutory construction would counsel a narrow reading of the choice-of-law provision [at issue].” Portillo v. Nat'l Freight, Inc., 323 F.Supp.3d 646, 655 (D.N.J. 2018). In Portillo, the choice-of-law provision stated that the agreement “shall be interpreted in accordance with, and governed by, the laws of the United States and, of the State of New Jersey.” Id. at 648. The court noted that the phrase “governed by” could be interpreted to encompass more than the breach of contract claim, and that some courts have construed it in that manner. See, e.g., Nat'l Seating & Mobility, Inc. v. Parry, No. C 10-02782 JSW, 2012 WL 2911923, at *2 (N.D. Cal. July 16, 2012) (finding that a choice-of-law provision stating that the agreement would be “governed by and construed in accordance” with Tennessee law was “broad enough to encompass the breach of contract, the tort claims, and the UCL claim”). Nonetheless, the district court in Portillo concluded that New Jersey law did not sweep so broadly and the court is persuaded by that analysis of this issue. See Portillo, 323 F.Supp.3d at 655-58.

         Applying New Jersey's rules governing the scope of choice-of-law provisions here, the court concludes that the provision in this case extends only to the parties' breach of contract claims. By their terms, the choice-of-law provisions at issue here apply to matters “pertaining to the validity, construction, and effect of [the agreements.]” (Doc. No. 52-2 at 7, 38.) Compared with other choice-of-law provisions which courts have been called upon to consider, this language is quite narrow. See, e.g., Country Visions, Inc. v. MidSouth LLC, No. 2:15-cv-01740-TLN-CKD, 2016 WL 1614585, at *2 (E.D. Cal. Apr. 22, 2016) (“Both parties agree to submit to exclusive jurisdiction in California and further agree that any cause of action arising under this Agreement shall be brought in an appropriate federal or state court located in California.”) (emphasis added); Brigham Young Univ. v. Pfizer, Inc., No. 2:06-CV-890 TS, 2012 WL 918744, at *1 (D. Utah Mar. 16, 2012) (“The validity, interpretation and performance of this Agreement and any dispute connected herewith shall be governed and construed in accordance with the laws of the State of Missouri.”) (emphasis added); Van Gundy v. P.T. Freeport Indonesia, 50 F.Supp.2d 993, 994 (D. Mont. 1999) (“Included in the offer was a choice of law provision which stated that all disputes arising out of the employment relationship would be governed by Louisiana law.”) (emphasis added). As the court interprets the choice-of-law provisions here, they are cabined solely to the contracts themselves, and do not indicate that resolution of any other disputes will be “governed by” New Jersey law. See Bd. of Educ. of Twp. of Cherry Hill v. Human Res. Microsystems, Inc., No. CIV. 09-5766 JBS/JS, 2010 WL 3882498, at *4 (D.N.J. Sept. 28, 2010) (“Generally, when a choice-of-law provision is intended to apply not only to interpretation and enforcement of the contract but also to any claims related to the contract, the language used is broader.”). Thus, although it may ultimately make little difference in the final analysis and resolution of the issues before it, the court will apply New Jersey law only to the breach of contract claims and will apply California law to the parties' remaining claims.

         B. Linde's Breach of Contract Claim

         Linde first seeks summary judgment on its breach of contract claim as it relates to the 2014 Agreement. To prevail on a breach of contract claim, a party must prove (1) the existence of a valid contract between the parties, (2) the opposing party's failure to perform a defined obligation under the contract, and (3) that the breach caused the claimant to sustain damages. EnviroFinance Grp. v. Envtl. Barrier Co., 113 A.3d 775, 787 (N.J. App. Div. 2015). Linde contends that these elements are all satisfied here as a matter of law. As for the existence of a valid contract, the 2014 Agreement was executed on November 1, 2014. (UMF at ¶ 11.) Under the terms of the 2014 Agreement, Valley Protein was required to purchase all of its CO2 exclusively from Linde for five years, but instead began purchasing CO2 from Linde's competitor, Air Liquide. (Id. at ¶¶ 12, 17.) The failure to purchase CO2 from Linde led directly to Linde's lost sales volume, causing the damages it now seeks to recover. (Id. at ¶ 23.)

         Valley Protein does not directly challenge these contentions in its opposition but rather asserts that it is entitled to rescission of the contract. Rescission is a remedy founded on “considerations of equity, ” the object of which is to “restore the parties to the status quo ante and prevent the party who is responsible for the misrepresentation from gaining a benefit.” Rutgers Cas. Ins. v. LaCroix, 946 A.2d 1027, 1034-35 (N.J. 2008). In support of this argument, Valley Protein contends that Linde's representations about the production capacity of its equipment amounted to an equitable fraud, providing the basis for rescission of the contract. Under New Jersey law, “equitable fraud provides a basis for a party to rescind a contract.” First Am. Title Ins. v. Lawson, 827 A.2d 230, 237 (N.J. 2003) (citing Jewish Ctr. of Sussex Cty. v. Whale, 432 A.2d 521 (N.J. 1981)). “‘In general, equitable fraud requires proof of (1) a material misrepresentation of a presently existing or past fact; (2) the maker's intent that the other party rely on it; and (3) detrimental reliance by the other party.'” Id. (quoting Liebling v. Garden State Indem., 767 A.2d 515, 518 (N.J. App. Div. 2001)). Rescission voids the contact, meaning that it is considered “null from the beginning” and treated as if it does not exist. Id.

         The parties agree that a rescission occurred as to at least some portion of the 2014 Agreement, as evidenced by Iannelli's email to Coyle agreeing to Valley Protein rescinding the agreement to rent the 2014 Freezer. (UMF at ¶ 15; Iannelli Decl. at ¶ 17; Doc. No. 52-2 at 57.) Iannelli confirmed this rescission at his deposition. (Doc. No. 57-2 at 34.) The parties' dispute centers on the scope of that rescission-namely, whether that rescission was effective only as to the rental of the 2014 Freezer, or whether it amounted to a rescission of the entire 2014 Agreement. Linde contends that the rescission was only with respect to the rental of the 2014 Freezer, while Valley Protein argues that this ...

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