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FILED
Apr 29 2009, 9:26 am

FOR PUBLICATION
ATTORNEYS FOR APPELLANT: JEFFREY R. GAITHER PAUL D. VINK Bose McKinney & Evans LLP Indianapolis, Indiana

of the supreme court, court of appeals and tax court

CLERK

ATTORNEYS FOR APPELLEE: WILLIAM E. WENDLING, JR. AMY E. HIGDON Campbell Kyle Proffitt LLP Carmel, Indiana

IN THE COURT OF APPEALS OF INDIANA
TRU-CAL, INC., Appellant-Plaintiff, vs. CONRAD KACSIK INSTRUMENT SYSTEMS, INC., Appellee-Defendant. ) ) ) ) ) ) ) ) ) )

No. 29A04-0809-CV-511

APPEAL FROM THE HAMILTON SUPERIOR COURT The Honorable William J. Hughes, Judge Cause No. 29D03-0608-PL-738

April 29, 2009

OPINION - FOR PUBLICATION

FRIEDLANDER, Judge

Tru-Cal, Inc. (Tru-Cal) appeals from the trial court's grant of summary judgment in favor of Conrad Kacsik Instrument Systems, Inc. (CKI) on all of Tru-Cal's claims asserted in its complaint against CKI. On appeal, Tru-Cal presents the following restated issues for review: 1. Does the integration clause in the settlement agreement between TruCal and CKI act to bar Tru-Cal from seeking rescission based upon fraudulent inducement? Did the trial court err in granting summary judgment on Tru-Cal's Indiana Crime Victims Relief Act claim?

2.

We reverse and remand.1 The facts viewed in a light most favorable to Tru-Cal, the non-moving party, follow. CKI employed Steven Sulzbach from April 1994 until his resignation in January 2005. Immediately following his employment with CKI, Sulzbach went to work for Tru-Cal, one of CKI's competitors. On February 1, 2005, CKI filed a complaint against Tru-Cal and Sulzbach in Cuyahoga County, Ohio. CKI listed the following counts in its complaint: I) Tortious interference with business relationships; II) misappropriation of trade secrets; III) unfair competition; IV) breach of employment agreement; V) breach of fiduciary duty; VI) procurement of breach of employment agreement; VII) unjust enrichment; and VIII) injunctive relief. The Ohio litigation was based in large part upon Sulzbach's violation of an employment agreement with CKI,2 which he allegedly signed on May 5, 1994. The
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By separate order, we deny Tru-Cal's request for oral argument, which was opposed by CKI. The two-page agreement provided in relevant part: 3. CONFIDENTIAL INFORMATION I acknowledge that I will receive...at the Company's expense, all or part of the following, and all of which is called "Confidential Information":

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employment agreement was attached to CKI's complaint. Thereafter, on February 4, CKI represented under oath via the affidavit of its Chief Executive Officer, Christopher Miller, that Sulzbach signed the employment agreement on or about May 5, 1994. Miller went on to detail the alleged violations of said agreement committed immediately prior to and following
Training, materials and assistance from the Company's officers and employees; B) Personal or mail contact with the Company's employees, agents, suppliers, customers and/or potential customers; C) Trade secrets and other confidential information of the Company (including by not limited to its unique business methods, procedures, operating techniques, and "know how", instructional materials, and customer and supplier information) which have been developed by the Company through substantial expenditures of time, effort and money, and which are important and unique property of the company. I acknowledge that the foregoing confidential information is of such value and nature as to make it reasonable and necessary for the protection of the Company's business interests that I not compete with the company during my employment and for a reasonable and limited period thereafter and that I will not make known or use (other than in the regular course of my employment with the Company) during the term of this agreement or thereafter, any Confidential Information. Upon termination of my employment, I also agree that I will promptly return to the Company all copies of all materials and all equipment furnished to me by the Company. EMPLOYEE OBLIGATIONS AND COVENANTS *** B) During my employment by the company and for two (2) years following such employment, however terminated, I will not engage in any of the following activities directly or indirectly, individually, or as a partner, joint venture, employee, agent, salesman, consultant, of any person, firm, association or corporation: (1) enter into or engage in any business which competes with the Company's business; or (2) solicit customers, business, or orders...for any business which competes with the Company's business; (3) promote or assist...any corporation engaged in any business which competes with the company's business; or *** C) During my employment and for two (2) years thereafter, I will communicate the contents of this Section 4 to any person, firm, association, or corporation, which I intend to be employed by...which is engaged in a business which is competitive to the business of the Company. D) The parties hereto agree and declare that because of the irreparable nature of the injury that could result if I compete with the company or otherwise violate Section 4, damages are inadequate compensation.... A)

4.

Appendix at 96.

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Sulzbach's resignation in January 2005. Miller attached a copy of the employment agreement to his affidavit. Upon learning of the Ohio litigation, Nathan Wright, the President of Tru-Cal, asked Sulzbach about the employment agreement, as Sulzbach had previously indicated that he did not have a non-compete agreement with his former employer. Sulzbach responded that the signature on the agreement appeared to be his but that he could not recall signing it. Wright attributed Sulzbach's inability to recall signing the employment agreement to the fact that more than ten years had passed since the agreement was executed. In reliance on the fully executed employment agreement attached to CKI's complaint, as well as Miller's sworn affidavit testimony, Tru-Cal agreed to settle the Ohio litigation. On February 16, only two weeks after the Ohio litigation commenced, Tru-Cal executed a settlement agreement in which it agreed to pay CKI $25,000 in damages, restrict Sulzbach's employment on behalf of Tru-Cal, and return certain confidential information to CKI. Of particular relevance to the instant cause of action, the settlement agreement contained mutual releases and an integration clause: 6. Mutual Release. It is hereby agreed that the parties, and their successors and assigns, mutually release and forever discharge each other, and the successors and assigns of each, and their officers, directors, shareholders, and agents from any and every claim, cause of action, liability, demand, damages, contracts or controversies of whatever kind or nature, whether presently known or unknown, that pertain or arise pursuant to the subject matter of The Lawsuit regardless of whether asserted in The Lawsuit.
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13. Entire Understanding. The parties hereby acknowledge and represent, each to the other, that this Agreement constitutes a full, final, complete, and

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entire understanding of the agreement among them concerning the subject matter hereof; that this Agreement expressly supersedes and supplants paragraph 4 of Sulzbach's May 5, 1994 Employment Agreement with Conrad Kacsik; and before execution of this Agreement they have read it and have fully informed themselves of its contents, meaning, and legal effect, and have understood the same; that their execution of this Agreement is their own free act and deed and that the terms of the Agreement are contractual and not a mere recital. The undersigned respectfully warrant that no promise or inducement has been offered to them except as herein set forth; that this Agreement is executed without reliance upon any statement or representation by the parties released or their attorneys or representatives concerning the nature and extent of any claims and/or damages or legal liability therefore; that this Agreement evidences the resolution of all claims disputed both as to the liability and to amount. Id. at 109, 111. Nearly a year after settlement of the Ohio litigation, Tru-Cal discovered information leading it to believe that CKI had forged Sulzbach's signature on the employment agreement. Specifically, beginning in December 2005 or January 2006, Wright had several discussions with Brenda McFadden, a former long-time employee and Vice President of CKI. McFadden informed Wright that no one at CKI to her knowledge had signed a non-compete agreement, including Sulzbach. During this same timeframe, Tru-Cal also spoke with other former CKI employees who all indicated they had not been asked to sign non-compete agreements. Wright subsequently retained a handwriting expert who opined that Sulzbach's signature on the employment agreement is a forgery. After Tru-Cal discovered that Sulzbach's signature had been forged on the

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employment agreement,3 it filed the instant action against CKI on August 7, 2006. Tru-Cal sought treble damages and attorney fees pursuant to the Indiana Crime Victims Relief Act, alleging that CKI had committed the crimes of conversion, forgery, deception, identity deception, and criminal mischief. In a separate count, Tru-Cal alleged that the Ohio litigation initiated by CKI constituted abuse of process. Finally, Tru-Cal alleged that CKI's conduct constituted fraud and, therefore, Tru-Cal was entitled to rescission of the settlement agreement, attorney fees, and punitive damages. On June 13, 2008, CKI filed its motion for judgment on the pleadings or, in the alternative, motion for summary judgment, along with a supporting memorandum and designated evidence. CKI argued that all of Tru-Cal's claims were barred by the settlement agreement which released all claims, whether known or unknown, relating to the subject matter of the Ohio litigation. In the alternative, CKI sought dismissal of the claim under the Indiana Crime Victims Relief Act because all of CKI's actions occurred outside of Indiana. Thereafter, Tru-Cal filed its response in opposition to CKI's motion, arguing, among other things, that the terms of the fraudulently induced settlement agreement cannot serve to bar a claim for rescission. Following a hearing, the trial court granted summary judgment in favor of CKI on August 12, 2008. Tru-Cal now appeals. When reviewing a trial court's grant or denial of summary judgment, we apply the same standard as the trial court. Herron v. Anigbo, 897 N.E.2d 444 (Ind. 2008). "Therefore,

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While CKI disputes Tru-Cal's allegations regarding the authenticity of Sulzbach's signature on the employment agreement, CKI acknowledges that for purposes of summary judgment we must assume that the signature was forged.

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summary judgment is to be affirmed only if there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law." Id. at 448. Further, all facts established by the designated evidence, and all reasonable inferences therefrom, are to be construed in favor of the nonmoving party. Herron v. Anigbo, 897 N.E.2d 444. 1. Tru-Cal argues that the trial court's summary judgment order "embraces the untenable and unjust proposition that the release and integration terms of a fraudulently induced settlement agreement provide a shield against a subsequent claim for rescission."4 Appellant's Brief at 6. Tru-Cal asserts that such a result is especially unjust where the integration clause is boilerplate and the alleged misrepresentation was not specifically disclaimed. CKI responds that Tru-Cal is bound by the language of the settlement agreement because it contained an integration clause and because, as a sophisticated party represented by counsel in the negotiation and settlement process, Tru-Cal should have investigated the validity of the employment agreement prior to executing the settlement agreement.5

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The trial court's order was a general grant of summary judgment on all claims. Tru-Cal correctly observes, however, that the central tenet of CKI's motion for summary judgment was that two provisions in the settlement agreement

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