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SCHWARTZ v. MICHIGAN POWER MANAGEMENT CO.
April 7, 1983
FRANK J. SCHWARTZ AND CHICAGO POWER MANAGEMENT, INC., PLAINTIFFS AND COUNTERDEFENDANTS,
MICHIGAN POWER MANAGEMENT COMPANY, DEFENDANT AND COUNTERPLAINTIFF.
The opinion of the court was delivered by: Shadur, District Judge.
MEMORANDUM OPINION AND ORDER
1. Count I claims UL approval was an
unsatisfied condition precedent to the Agreement.
2. Count II asserts Michigan Power breached the
Agreement by failing to secure UL approval and to
offer Schwartz its new products under the
Agreement's right of first refusal provision.
3. Count III charges Michigan Power induced
Schwartz to enter into the Agreement through
various misrepresentations, including its
statement that UL approval would be procured for
all its present products.*fn2
In turn, Michigan Power has filed a counterclaim, asserting
Schwartz's failure to perform his Agreement undertakings.
Schwartz has filed two summary judgment motions under
Fed.R.Civ.P. ("Rule") 56, one as to all three Complaint counts
and the other as to the counterclaim. For the reasons stated
in this memorandum opinion and order, both motions are denied.
On August 10, 1980 Michigan Power placed an ad in Chicago
newspapers, offering to sell energy management electrical
equipment. In response to the ad Schwartz called Michigan
Power for further details. Michigan Power then mailed Schwartz
some brochures describing the equipment.
Over the next several days Schwartz explored with Michigan
Power President Carson B. Ashworth ("Ashworth") the
possibility of serving as Michigan Power's dealer in the
Chicago territory. During the negotiations Schwartz asked
whether Michigan Power's energy systems had been listed by UL.
Ashworth qualified his "no" answer by saying Michigan Power
had already initiated and would continue to pursue the UL
listing process. Ashworth Dep. 10.
On August 21, 1980 Schwartz and Ashworth signed the
four-section Agreement at Michigan Power's office in Michigan
(Agreement's provisions are cited "Section ___ " in this
1. Section I appointed Schwartz as Michigan
Power's exclusive Chicago-area*fn4 dealer "for
the purpose of selling the MPM-8000 Power
Management Systems" (the "Systems").
2. Section II called for the sale of 50
3. Section III identified the various kinds of
assistance Michigan Power was to provide
4. Section IV primarily specified Schwartz's
responsibilities and rights:
(a) Section IV(1) obligated Schwartz to
"advertise, promote, and sell the . . .
MPM-8000 Power Management Systems in his
(b) Section IV(2) required Schwartz to
"[h]ire and train salesmen to sell the
manufacturers [sic] energy systems."
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