PRECEDENTIAL
`
`UNITED STATES COURT OF APPEALS
`FOR THE THIRD CIRCUIT
`_______________
`
`Nos. 19-1028 & 19-1107
`_______________
`
`SODEXOMAGIC, LLC
`
`v.
`
`DREXEL UNIVERSITY
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`SodexoMAGIC, LLC,
` Appellant in No. 19-1028
`
`
`
`Drexel University,
` Appellant in No. 19-1107
`
`_______________
`
`
`
`
`
`On Appeal from the United States District Court
`for the Eastern District of Pennsylvania
`(D.C. No. 2:16-cv-05144)
`District Judge: Honorable Michael M. Baylson
`_______________
`
`Argued: March 16, 2020
`
`Before: AMBRO, BIBAS, and PHIPPS, Circuit Judges.
`
`(Filed: January 20, 2022)
`_______________
`
`
`
`UNITED STATES COURT OF APPEALS
`FOR THE THIRD CIRCUIT
`_______________
`
`Nos. 19-1028 & 19-1107
`_______________
`
`SODEXOMAGIC, LLC
`
`v.
`
`DREXEL UNIVERSITY
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`
`SodexoMAGIC, LLC,
` Appellant in No. 19-1028
`
`
`
`Drexel University,
` Appellant in No. 19-1107
`
`_______________
`
`
`
`
`
`On Appeal from the United States District Court
`for the Eastern District of Pennsylvania
`(D.C. No. 2:16-cv-05144)
`District Judge: Honorable Michael M. Baylson
`_______________
`
`Argued: March 16, 2020
`
`Before: AMBRO, BIBAS, and PHIPPS, Circuit Judges.
`
`(Filed: January 20, 2022)
`_______________
`
`
`
` [ARGUED]
`Shay Dvoretzky
`Skadden Arps Slate Meagher & Flom
`1440 New York Avenue, N.W.
`Washington, DC 20005
`Attorney for SodexoMAGIC, LLC
`
`
`Jared D. Bayer
`Stephen A. Cozen [ARGUED]
`Robert W. Hayes
`Cozen O’Connor
`1650 Mark Street
`One Liberty Place, Suite 2800
`Philadelphia, PA 19103
`Attorneys for Drexel University
`
`__________
`
`OPINION OF THE COURT
`__________
`
`
`PHIPPS, Circuit Judge.
`
`
`TABLE OF CONTENTS
`
`
`I.
`
`Introduction ................................................................... 5
`
`II.
`
`Factual Background ...................................................... 6
`
`A. The Competition to Provide Food Services at Drexel
`University ...................................................................... 6
`
`B. Negotiation of the Management Agreement ................. 8
`
`C. The Short Unhappy Life of the Management
`Agreement ..................................................................... 9
`
`III.
`
`Procedural History and Jurisdictional Analysis .......... 12
`
`2
`
`
`
`A. The Parties’ Claims and Counterclaims ..................... 12
`
`B. The District Court’s Jurisdiction over the Dispute ..... 13
`
`C. The District Court’s Resolution of All Claims and
`Counterclaims ............................................................. 15
`
`D. Appellate Jurisdiction ................................................. 16
`
`IV. Discussion ................................................................... 17
`
`A. The Parties’ Competing Fraudulent Inducement
`Claims Have Different Fates: SodexoMAGIC’s
`Claim Survives; Drexel’s Counterclaim Does Not. .... 19
`
`1.
`
`2.
`
`a.
`
`b.
`
` Common-Law Fraud Claims in Pennsylvania ..... 20
`
` SodexoMAGIC’s Fraudulent Inducement Claim
`for Compensatory Damages Survives Summary
`Judgment. .............................................................. 23
`
`SodexoMAGIC Presents Sufficient Evidence of
`a Misrepresentation as Well as Concealment. ...... 23
`
`The District Court Did Not Abuse Its Discretion in
`Denying Drexel’s Motion to Strike Declarations
`by Three SodexoMAGIC Witnesses. ................... 28
`
`c. Drexel’s Remaining Counterarguments for
`Upholding Summary Judgment in Its Favor
`Also Fail. .............................................................. 34
`
`3.
`
`a.
`
` The Parol Evidence Rule Does Not Bar Sodexo-
`MAGIC’s Claim for Fraudulent Inducement. ...... 36
`
`Integration Clauses, the Parol Evidence Rule,
`and Fraudulent Inducement Claims Under
`Pennsylvania Law. ................................................ 37
`
`3
`
`
`
`b.
`
`The Management Agreement Lacks Fraud-
`Insulating Provisions, so the Parol Evidence Rule
`Does Not Preclude SodexoMAGIC’s Fraudulent
`Inducement Claim. ............................................... 42
`
`4.
`
`5.
`
` Pennsylvania’s Gist of the Action Doctrine
`Does Not Bar SodexoMAGIC’s Fraud Claim. ..... 44
`
` Drexel’s Fraudulent-Inducement Counterclaim
`Fails ...................................................................... 47
`
`B. SodexoMAGIC’s Breach-of-Contract Claim for
`Failure to Renegotiate in Good Faith Survives
`Summary Judgment. ................................................... 51
`
`1.
`
`2.
`
` A Promise to Renegotiate in Good Faith May Be
`Enforceable Under Pennsylvania Law, and the
`Promise Between These Parties Is Enforceable. .. 51
`
` A Genuine Dispute of Material Fact Remains as
`to Whether Drexel Renegotiated in Good Faith. .. 59
`
`C. SodexoMAGIC’s Claim for Enhanced Payments for
`Fall 2016 Survives Summary Judgment. .................... 65
`
`1.
`
`2.
`
` There Was Consideration for a Separate
`Contract for the Fall 2016 Semester. .................... 65
`
` A Reasonable Jury Could Find that
`SodexoMAGIC Accepted Drexel’s Offer. ........... 66
`
`D. Drexel’s Challenge to SodexoMAGIC’s Catering-
`Shortfall Claim Fails. .................................................. 68
`
`E. SodexoMAGIC’s Claims for Unjust Enrichment
`Fail. ............................................................................. 70
`
`V.
`
`Conclusion .................................................................. 73
`
`4
`
`
`
`
`
`I.
`
`INTRODUCTION
`
`After a long-standing business relationship went bad, this,
`the ensuing litigation, went big. For years, a vendor provided
`food services at a private university, but in 2014 the university
`announced that it would competitively bid the contract for on-
`campus dining. Although the same vendor ultimately won that
`competition, the process of bidding, negotiating, and finalizing
`that new contract fractured the relationship beyond repair.
`About two years into the contract’s ten-year period of
`performance, the vendor sued the university for fraud, multiple
`breaches of contract, and alternatively for unjust enrichment.
`The university responded with fraud and breach-of-contract
`counterclaims.
`
`In resolving cross-motions for summary judgment and
`attendant motions to strike, the District Court rejected the bulk
`of both parties’ claims. All that survived summary judgment
`were relatively small pieces of the vendor’s breach-of-contract
`claims and portions of the university’s breach-of-contract
`claim. Rather than proceed to trial on the fragments of their
`respective cases, the parties referred the remaining claims and
`counterclaims to arbitration and jointly moved to dismiss them.
`The District Court granted that motion and entered final
`judgment, which the parties now appeal, primarily to dispute
`the summary judgment ruling.
`
`In reviewing the District Court’s summary judgment
`rulings de novo, see Cranbury Brick Yard, LLC v. United
`States, 943 F.3d 701, 708 (3d Cir. 2019), and the motion-to-
`strike order for an abuse of discretion, see Daubert v. NRA
`Grp., LLC, 861 F.3d 382, 389 (3d Cir. 2017), the District Court
`
`5
`
`
`
`correctly resolved much of this controversy, but it erred in
`rejecting the vendor’s fraud and breach-of-contract claims.
`Thus, we will affirm the judgment in part, vacate in part, and
`remand this case for further proceedings.
`
`
`II.
`
`FACTUAL BACKGROUND
`
`A. The Competition to Provide Food Services at Drexel
`University
`
`For nearly twenty years, either directly or through one of its
`predecessor companies, SodexoMAGIC, LLC
`(‘SDM’)
`provided on-campus dining services at Drexel University, a
`private university in Philadelphia. But in early 2014 one of
`SDM’s rivals, Aramark Corporation, which has its global
`headquarters in Philadelphia, made an unsolicited offer to
`Drexel to take over campus dining services. SDM responded
`with its own unsolicited offer to continue providing food
`services. Rather than select one of those offers, Drexel
`announced a two-phase competitive bidding process for the on-
`campus dining contract.
`
`In the first phase, Drexel sought to identify qualified
`bidders. It proposed a scope of work that involved providing
`“world class dining and catering services” at its campuses.
`Drexel Univ., Request for Proposal for a Campus Dining
`Strategic Partnership (SA133). Drexel also expected the food-
`service provider to make capital investments of $20 million
`over the span of the ten-year contract. While Drexel’s phase-
`one solicitation did not contain many details about on-campus
`dining, it did represent that Drexel would share “as much detail
`about the desired relationship and facts around the current
`program as can be reasonably provided.” Id. (SA131). The
`
`6
`
`
`
`solicitation also included an estimate that the contract, over its
`full term, would have a value between $275 and $300 million.
`At the end of the first phase, Drexel determined that SDM and
`Aramark, along with two other bidders, qualified to advance to
`the second phase.
`
`The second phase took place during the summer of 2014,
`and it involved competitive negotiations. In its more detailed
`phase-two solicitation, Drexel provided an overview of its on-
`campus dining and food-service operations. That overview
`pointed out that Drexel’s Strategic Plan called for an increase
`of its then-current enrollment of 26,132 students to a student
`population of 34,000 by 2021. Drexel noted, however, that not
`all students had to have all-inclusive meal plans – that
`requirement applied only to first-year undergraduates. And an
`appendix to the solicitation informed bidders that Drexel was
`projecting an incoming first-year class of 3,100 students for the
`2014–15 academic year. But for purposes of its own internal
`budget, Drexel estimated that class size at 2,800 students. As
`succinctly stated in internal correspondence from one of
`Drexel’s senior associate vice presidents, “we gave the bidders
`participant numbers based on a freshman class size of 3,100
`and the FY15 budget that was loaded by Finance is based on
`2,800.” Email from Joe Campbell, Senior Associate Vice
`President, Drexel, to Rita LaRue, Senior Associate Vice
`President, Drexel (Aug. 4, 2014) (SA182).
`
`Three of the remaining bidders submitted proposals.
`Drexel selected two of them – SDM and Aramark – as finalists
`and requested that they each submit a best and final offer,
`referred to as a ‘BAFO.’ In its BAFO, SDM included an
`additional term: an offer to increase its capital contributions by
`$4 million beginning in year six of the contract. After
`
`7
`
`
`
`considering both BAFOs, Drexel determined that SDM’s
`BAFO had more favorable financial terms and was superior in
`other respects. On August 15, 2014, Drexel selected SDM for
`the dining services contract and broke off negotiations with
`Aramark. Having won the competition, SDM continued to
`provide on-campus dining services for the 2014–15 academic
`year while it worked with Drexel to finalize a new contract.
`
`B. Negotiation of the Management Agreement
`
`Finalizing the new contract was not a smooth process.
`Problems started in September 2014 when SDM proposed an
`initial draft that omitted the additional $4 million capital
`contribution that it had proposed in its BAFO. After several
`months of negotiations, the parties agreed to condition that
`investment on certain sales levels, evaluated before year six of
`the contract.
`
`But that was not the only point of contention. SDM also
`proposed that Drexel guarantee annual increases in its first-
`year student enrollment. Instead of a guarantee, the parties
`agreed that SDM had relied on Drexel’s representations of its
`future student enrollment and that they would renegotiate in
`good faith if first-year student enrollment did not increase
`annually by at least two percent.
`
`Having overcome those and other obstacles, the parties
`executed the contract, known as the ‘Management Agreement,’
`on May 28, 2015. Although it was signed then, the
`Management Agreement specified a commencement date of
`August 25, 2014, so that it covered the services SDM provided
`after it had won the competitive bidding process. The
`Management Agreement also included an integration clause,
`
`8
`
`
`
`which stated that it contained all agreements between the
`parties on the subject matter.
`
`C. The Short Unhappy Life of the Management
`Agreement
`
`The Management Agreement may have been doomed from
`the start. The day it was executed, The Philadelphia Inquirer
`reported that Drexel’s first-year class had nearly 200 fewer
`students than the prior year. See Susan Snyder, That Big
`Enrollment Change at Drexel: How Did it Go?, Phila. Inquirer
`(May 28, 2015) (SA1553–54). Soon afterward, through a
`‘Dear Colleague’ letter, Drexel’s President informed university
`stakeholders, including SDM, that the university had “focused
`on attracting a smaller pool of exceptionally qualified
`applicants,” with the result being that the “enrolled class will
`be smaller than in previous years,” causing the university to
`operate “with less revenue than [it] historically experienced.”
`Letter from John A. Fry, President, Drexel, to Colleagues of
`Drexel (June 8, 2015) (SA519–20). According to SDM, that
`news of reduced student enrollment came as “a complete
`shock.” Email from Nancy C. Arnett, Vice President, Sodexo,
`to Greg Klose, Vice President, Sodexo (June 12, 2015)
`(SA524). And when SDM asked about that development,
`Drexel’s lead negotiator for the Management Agreement
`forwarded the inquiry to one of Drexel’s executive directors,
`who remarked, “I guess they were going to find out sooner or
`later.” Email from Donald Liberati, Executive Director,
`Drexel, to Rita LaRue, Senior Associate Vice President, Drexel
`(June 9, 2015) (SA526).
`
`Consistent with those revelations, Drexel enrolled 2,720
`students in the first-year class for the 2015–16 academic year –
`
`9
`
`
`
`a seven percent decrease from the year before. Even with that
`diminution, SDM made an initial capital contribution of $9.3
`million in July 2015, which funded construction of a new
`dining facility, the Urban Eatery at Lancaster Avenue. But the
`reduced first-year student enrollment had an immediate effect
`on SDM’s revenues.
`
`In November 2015, only six months after executing the
`contract, revenue from catering and meal plans fell below the
`assumptions referenced in the Management Agreement. And
`SDM requested compensation for that shortfall. For several
`months, the parties engaged in discussions to restructure
`certain aspects of the Management Agreement, including
`reducing the additional capital contributions that SDM had
`promised.
`
`
`As the parties’ relationship soured, the termination
`provisions of the Management Agreement took on greater
`significance. Those terms provided two mechanisms for
`termination before full term: for cause and for convenience. To
`terminate for cause, a party had to notify the other of a breach,
`and that would commence a cure period. If the breach was not
`cured or otherwise resolved by the end of the cure period, then
`the complaining party could terminate the Management
`Agreement.
` The
`termination-for-convenience provision
`required 60 days’ notice that a party would terminate, and upon
`expiration of that period, the Management Agreement would
`terminate.
`
`After several months without resolution, on July 25, 2016,
`SDM began the process to terminate the Management
`Agreement for cause. It notified Drexel that it believed the
`shortfalls were material breaches on the theory that sales fell
`
`10
`
`
`
`below the amounts listed as assumptions in the Management
`Agreement. SDM then tolled the cure period, and the parties
`continued discussions through August 2016.
`
`Upon receiving SDM’s notice of breach, Drexel also began
`pursuing other options. Two days after SDM’s notice, Drexel
`reconnected with other bidders to explore their interest in
`taking over the on-campus food-services operations. Using
`five-year projections for an incoming first-year class of 2,400
`students, Drexel and Aramark discussed the possibility that
`Aramark would start providing on-campus food services in
`January 2017.
`
`
`As that possibility became more likely, and without
`reconciling completely with SDM, Drexel exercised its option
`to terminate the Management Agreement for convenience.
`Although the Management Agreement required only 60 days’
`notice
`to
`terminate for convenience, by
`letter dated
`September 19, 2016, Drexel provided 82 days’ notice: it stated
`its intention to terminate the Management Agreement for
`convenience on December 10, 2016, the last day of the fall
`semester. By that same correspondence, Drexel offered SDM
`various financial incentives to remain on campus and provide
`food services for the rest of the Fall 2016 Semester. Those
`incentives included an increased daily rate for certain meal
`plans, a reduced commission due to Drexel, and a release of
`SDM’s obligation to make additional capital contributions
`under the Management Agreement.
`
`The days following Drexel’s notice of termination were
`eventful. On September 23, 2016, senior staff at Drexel met
`with Aramark and conditionally agreed to contract with
`Aramark for on-campus dining services starting in January
`
`11
`
`
`
`2017. On September 26, 2016, SDM responded to Drexel’s
`notice of termination. In that letter, SDM gave notice that it
`was ending the cure period, and it purported to terminate the
`Management Agreement for cause effective at the close of
`business that day. But through that same communication,
`SDM also agreed to remain on campus for the remainder of the
`Fall 2016 Semester, explaining that it “does not leave students
`in mid-term.” Letter from Timothy J. Fazio, Manion Gaynor
`& Manning, LLP, to Stephen A. Cozen, Cozen O’Connor P.C.
`(Sept. 26, 2016) (JA158). The next day, SDM filed this lawsuit
`in the Eastern District of Pennsylvania.
`
`Despite suing Drexel, SDM remained on campus and
`provided services through December 10, 2016. Drexel did not
`accept a reduced commission or make enhanced payments for
`dining services provided by SDM, and SDM did not make any
`further capital contributions.
`
`III. PROCEDURAL HISTORY AND JURISDICTIONAL
`ANALYSIS
`
`A. The Parties’ Claims and Counterclaims
`
`In its original complaint, SDM pursued three causes of
`action. First, it alleged that Drexel fraudulently induced it to
`enter the Management Agreement, and it sought compensatory
`and punitive damages. Second, SDM alleged that Drexel
`breached its contractual duty to renegotiate in good faith.
`Third, as a claim in the alternative, SDM alleged that Drexel
`was unjustly enriched when SDM assumed certain liabilities
`and provided dining services at reduced rates.
`
`
`12
`
`
`
`Drexel also sought to vindicate its grievances against SDM.
`It counterclaimed that SDM breached the Management
`Agreement by failing
`to perform specific obligations,
`including filling key management positions, making financial
`contributions to certain Drexel initiatives, meeting certain
`performance standards, and securing campus appearances from
`Earvin “Magic” Johnson.
`
`Both parties later revised their initial pleadings. SDM
`amended and supplemented its complaint to add another
`breach-of-contract claim. In that count, SDM alleged that
`Drexel refused to pay invoices due under the Management
`Agreement and that Drexel owed SDM enhanced payments for
`dining services provided during the Fall 2016 Semester. After
`discovery, on September 12, 2017, Drexel supplemented its
`counterclaim to allege that SDM’s offer of additional capital
`contributions in its BAFO was insincere and that through that
`term SDM fraudulently induced Drexel to award the contract
`to SDM instead of Aramark.
`
`B. The District Court’s Jurisdiction over the Dispute
`
`Under the diversity statute, the District Court had subject
`matter jurisdiction over this case. That statute requires
`complete diversity of citizenship between opposing parties and
`an amount in controversy in excess of $75,000. See 28 U.S.C.
`§ 1332(a); Exxon Mobil Corp. v. Allapattah Servs., Inc.,
`545 U.S. 546, 553 (2005) (explaining that the presence of a
`single plaintiff from the same state as a single defendant
`deprives a district court of original diversity jurisdiction);
`Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 267 (1806).
`Both of those jurisdictional requirements are satisfied here.
`
`
`13
`
`
`
`There is complete diversity because SDM and Drexel are
`not citizens of the same state. As a limited liability
`corporation, SDM takes on the citizenship of its members and
`submembers. See Zambelli Fireworks Mfg. Co. v. Wood,
`592 F.3d 412, 420 (3d Cir. 2010) (explaining that determining
`an LLC’s citizenship requires drilling down “through however
`many layers of partners or members there may be” to evaluate
`the citizenship of each (internal quotation marks omitted)); cf.
`Lincoln Benefit Life Co. v. AEI Life, LLC, 800 F.3d 99, 111
`(Ambro, J., concurring) (“There is no good reason to treat
`LLCs differently from corporations for diversity-of-citizenship
`purposes.”). Accounting for those members and submembers,
`SDM is a citizen of Delaware, Maryland, and California for
`purposes of the diversity statute.1 As a non-profit corporation,
`Drexel has citizenship for purposes of the diversity statute in
`the state of its incorporation and in the state of its principal
`place of business – Pennsylvania in both instances. See
`28 U.S.C. § 1332(c)(1); see also Zambelli, 592 F.3d at 419.
`Without any overlap in the citizenship of SDM and Drexel, the
`complete diversity requirement is satisfied.
`
`
`
`1 SDM has two members: Sodexo Operations, LLC and Magic
`Food Provision, LLC. Sodexo Operations, LLC has one
`member, Sodexo, Inc., which, as a corporation, has citizenship
`in Delaware as its state of incorporation and in Maryland
`through its principal place of business. See 28 U.S.C.
`§ 1332(c)(1); see also Zambelli, 592 F.3d at 419. SDM’s other
`member, Magic Food Provision, LLC, is a wholly owned
`subsidiary of Magic Johnson Enterprises, Inc., that is both
`incorporated and has its principal place of business in
`California.
`
`14
`
`
`
`The amount in controversy also exceeds the $75,000
`threshold in the diversity statute. See 28 U.S.C. § 1332(a).
`The multi-million-dollar value of the Management Agreement
`coupled with the nature of SDM’s claims for compensatory
`damages, expectation damages, and punitive damages
`precludes a finding that to “a legal certainty” SDM seeks a
`recovery less than the jurisdictional amount. Auto-Owners Ins.
`Co. v. Stevens & Ricci Inc., 835 F.3d 388, 395 (3d Cir. 2016)
`(quoting St. Paul Mercury Indem. Co. v. Red Cab Co., 303 U.S.
`283, 288–89 (1938)). Accordingly, this case also clears the
`$75,000 amount-in-controversy threshold.
`
`C. The District Court’s Resolution of All Claims and
`Counterclaims
`
`The District Court resolved much of this dispute by
`partially granting and partially denying the parties’ cross-
`motions for summary judgment. That ruling decimated SDM’s
`case. It lost its fraudulent inducement claim, its breach-of-
`contract claims (which were based on Drexel’s alleged failure
`to renegotiate in good faith and failure to pay enhanced
`compensation for services during the Fall 2016 Semester), and
`its alternative claim for unjust enrichment. The District Court
`reached those outcomes despite denying Drexel’s motion to
`strike three declarations by SDM employees under the sham
`affidavit rule. But Drexel lost more than that motion: the
`District Court also rejected
`its fraudulent
`inducement
`counterclaim.
`
`Shortly before the scheduled trial on the remaining counts,
`SDM moved for clarification on whether its breach-of-contract
`claim for failure to pay a catering-shortfall invoice survived
`
`15
`
`
`
`summary judgment. Over Drexel’s objection, the District
`Court permitted that claim.
`
`With that issue resolved, both parties agreed to arbitrate the
`remaining claims and counterclaims. To that end, they jointly
`filed a motion to dismiss and attached exhibits identifying the
`remaining claims and counterclaims. The District Court
`granted that motion and, through a separate document, entered
`final judgment on December 6, 2018. See Fed. R. Civ. P.
`58(a). Both parties then appealed.
`
`
`D. Appellate Jurisdiction
`
`As timely challenges to a final order, both appeals come
`within this Court’s appellate jurisdiction. See 28 U.S.C.
`§ 1291. The District Court’s judgment on December 6, 2018,
`was final and appealable because all outstanding claims and
`counterclaims had been resolved through the combination of
`the summary judgment ruling and the subsequent order
`dismissing the remaining claims. See Aluminum Co. of Am. v.
`Beazer E., Inc., 124 F.3d 551, 559–62 (3d Cir. 1997) (holding
`that an order dismissing and referring to private arbitration all
`unresolved claims achieved finality). SDM’s notice of appeal,
`filed on January 2, 2019, was within the time permitted by rule.
`See Fed. R. App. P. 4(a)(1)(A) (requiring parties in a civil case
`to file a notice of appeal within 30 days after entry of the
`judgment).
` Drexel’s notice of cross-appeal, filed on
`January 11, 2019, was also timely. See Fed. R. App. P. 4(a)(3)
`(providing that a notice of cross-appeal must be filed within
`14 days of another party’s notice of appeal or within the time
`otherwise remaining for the other party to appeal, whichever is
`longer).
`
`16
`
`
`
`IV. DISCUSSION
`
`The summary judgment standard has not substantively
`changed since a trilogy of Supreme Court cases on the topic in
`1986.2 By the text of Rule 56, summary judgment is
`appropriate “if the movant 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); see also
`Brooks v. Kyler, 204 F.3d 102, 105 n.5 (3d Cir. 2000). As
`explained by the Supreme Court, for a factual dispute to be
`material, its resolution must have the potential to affect the
`outcome of the suit. See Anderson v. Liberty Lobby, Inc.,
`477 U.S. 242, 248 (1986). A dispute is genuine “if the
`evidence is such that a reasonable jury could return a verdict
`for the nonmoving party,” id., but “the mere existence of a
`scintilla of evidence” favoring the non-moving party will not
`prevent summary judgment, id. at 252. See also Jutrowski v.
`Twp. of Riverdale, 904 F.3d 280, 288–89 (3d Cir. 2018). Still,
`in assessing the genuineness of a potential factual dispute,
`inferences from the underlying facts should be drawn in favor
`
`
`2 See Celotex Corp. v. Catrett, 477 U.S. 317 (1986); Anderson
`v. Liberty Lobby, Inc., 477 U.S. 242 (1986); Matsushita Elec.
`Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986); see also
`Fed. R. Civ. P. 56 advisory committee’s note to 1987
`amendment (explaining that “[n]o substantive change is
`intended”); id. advisory committee’s note to 2007 amendment
`(explaining that “[t]hese changes are intended to be stylistic
`only”); id. advisory committee’s note to 2009 amendment
`(consolidating and revising the timing provisions for summary
`judgment, but not affecting the standard); id. advisory
`committee’s note to 2010 Amendment (“The standard for
`granting summary judgment remains unchanged.”).
`
`17
`
`
`
`of the nonmoving party. See Matsushita Elec. Indus. Co. v.
`Zenith Radio Corp., 475 U.S. 574, 587 (1986); In re IKON
`Office Solutions, Inc., 277 F.3d 658, 666 (3d Cir. 2002). But
`if the nonmoving party “fails to make a showing sufficient to
`establish the existence of an element essential to [its] case, and
`on which [it] will bear the burden of proof at trial,” then
`summary judgment is appropriate for the moving party.
`Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986).
`
`In exercising diversity jurisdiction, a federal court employs
`the choice-of-law principles of its forum state to determine
`which substantive law governs whether a party is entitled to
`judgment as a matter of law. See Klaxon Co. v. Stentor Elec.
`Mfg. Co., 313 U.S. 487, 496–97 (1941). Under Pennsylvania
`choice-of-law rules, the first step involves assessing whether a
`conflict exists between the substantive law of multiple
`jurisdictions. See Auto-Owners, 835 F.3d at 404. But here, the
`parties have identified no such conflict and have litigated this
`case under Pennsylvania substantive law. Thus, substantive
`issues should be decided as the Pennsylvania Supreme Court
`“would rule if it were deciding this case.” Id. at 403 (quoting
`Norfolk S. Ry. Co. v. Basell USA Inc., 512 F.3d 86, 91–92 (3d
`Cir. 2008)); see generally Hanna v. Plumer, 380 U.S. 460, 471
`(1965) (providing “rough[]” guidance that in diversity cases
`“federal courts are to apply state ‘substantive’ law and federal
`‘procedural’ law”). In making that prediction, the decisions of
`intermediate Pennsylvania appellate courts receive “significant
`weight in the absence of an indication that the highest state
`court would rule otherwise.” Polselli v. Nationwide Mut. Fire
`Ins. Co., 126 F.3d 524, 528 n.3 (3d Cir. 1997) (quoting City of
`Phila. v. Lead Indus. Ass’n, 994 F.2d 112, 123 (3d Cir. 1993));
`see also Pac. Emps. Ins. Co. v. Glob. Reinsurance Corp. of
`Am., 693 F.3d 417, 433 (3d Cir. 2012).
`
`18
`
`
`
`
`A. The Parties’ Competing Fraudulent Inducement
`Claims Have Different Fates: SodexoMAGIC’s
`Claim Survives; Drexel’s Counterclaim Does Not.
`
`The parties both sued each other for fraudulent inducement.
`In its fraud claim against Drexel, SDM alleged that Drexel
`misrepresented and concealed its future student-enrollment
`projections, which led SDM to bid more favorably on the
`Management Agreement. Drexel countersued for fraudulent
`inducement on allegations that SDM’s BAFO included capital
`contributions that SDM never intended to make and that such
`deceit prompted Drexel to negotiate exclusively with SDM, not
`Aramark.
`
`
`Both parties moved for summary judgment against their
`opponent’s fraud claims. At the prompting of the District
`Court, they each argued that the parol evidence rule did not bar
`their fraud claim. They also asserted that the gist of the action
`doctrine precluded the other’s fraud claim. SDM additionally
`argued that Pennsylvania’s statute of limitations foreclosed
`Drexel’s counterclaim.
`
`The District Court rejected the parties’ competing fraud
`claims at summary judgment. See SodexoMAGIC, LLC v.
`Drexel Univ., 333 F. Supp. 3d 426, 456, 466–67 (E.D. Pa.
`2018). In so doing, the District Court found that SDM
`produced evidence of a prima facie fraud claim but entered
`summary judgment for Drexel due to the parol evidence rule
`and the gist of the action doctrine. Id. at 445–57. The District
`Court relied on those same affirmative defenses to reject
`Drexel’s fraud claim. Id. at 466–67. In ruling for SDM on
`
`19
`
`
`
`those grounds, the District Court did not address SDM’s
`statute-of-limitations defense.
`
`On appeal, each party challenges the District Court’s fraud
`rulings. SDM argues that the District Court misapplied the
`parol evidence rule and the gist of the action doctrine to its own
`fraud claim. Consistent with that position, SDM does not
`defend the District Court’s reliance on those principles to bar
`Drexel’s fraud claim. Instead, it offers two alternative bases
`for sustaining the judgment against Drexel’s fraud claim: it
`renews the statute-of-limitations defense that the District Court
`did not consider, and it argues for the first time on appeal that
`Drexel has not produced evidence needed for the justifiable-
`reliance and causation elements of a prima facie fraud case.
`Drexel takes a more nuanced approach. It contends that the
`parol evidence rule and the gist of the action doctrine do not
`apply to its fraud counterclaim but that they do bar SDM’s
`fraud claim. As an alternative, Drexel argues for the first time
`on appeal that SDM did not demonstrate a misrepresentation
`needed for a prima facie fraud case. For the reasons below,
`SDM’s fraud claim survives summary judgment, but Drexel’s
`fraud counterclaim does not.
`
`
`1. Common-Law Fraud Claims in Pennsylvania
`
`To redress injuries caused by intentional falsehoods – either
`false statements or deliberately concealed facts – Pennsylvania
`recognizes a civil action for fraud. See Moser v. DeSetta,
`589 A.2d 679, 682 (Pa. 1991) (“The concealment of a material
`fact can amount to a culpable misrepresentation no less than
`does an intentional false statement.”). As developed in
`Pennsylvania common law, a fraud claim consists of six
`elements:
`
`20
`
`
`
`
`
`(1)
`
`(a) A misrepresentation or
`
`(b) A concealment;
`
`(2) Which is material to the transaction at hand;
`
`(3)
`
`(a) Made with knowledge of its falsity or
`recklessness as to whether it is true or false
`(for a misrepresentation), or
`
`(b) Calculated to deceive (for a conceal-
`ment);
`
`(4) With the intent of misleading another into
`relying on it;
`
`(5) Justifiable reliance on the misrepresenta-
`tion; and
`
`(6) A resulting injury proximately caused by
`such reliance.
`
`See Gibbs v. Ernst, 647 A.2d 882, 889 & n.12 (Pa. 1994);
`Yound
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