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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF MICHIGAN

SOUTHERN DIVISION

FORD MOTOR COMPANY, a Delaware 

corporation, and FORD GLOBAL 

TECHNOLOGIES, LLC, a Delaware 

limited liability company

Plaintiffs,

v.

THERMOANALYTICS, INC., a Michigan 

corporation,

Defendant.

 /

Case No. 14-cv-13992

UNITED STATES DISTRICT COURT JUDGE

GERSHWIN A. DRAIN

UNITED STATES MAGISTRATE JUDGE

R. STEVEN WHALEN

OPINION AND ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT’S 

MOTION FOR PARTIAL SUMMARY JUDGMENT [67]

I.INTRODUCTION

Ford Motor Company and Ford Global Technologies, LLC (“Plaintiffs” or 

“FGTI”), commenced this action on October 16, 2014 against ThermoAnalytics, 

Inc. (“Defendant”). See Dkt. No. 1. On August 14, 2015, Plaintiffs filed an 

Amended Complaint adding no new parties. See Dkt. No. 30. In the Amended 

Complaint, Plaintiffs contend that Defendant is liable for: (I) False Designation of 

Origin under 15 U.S.C. § 1125(a); (II) Breach of Contract; (III) Promissory 

Estoppel; and request (IV) Declaratory Judgment on the RadTherm Software. See 

id.

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On July 29, 2015, Plaintiffs filed a Motion for Partial Summary Judgment on 

both the False Designation of Origin claim and the Breach of Contract claim. See

Dkt. No. 25. The Court granted Plaintiffs’ Motion for Partial Summary Judgment 

on October 28, 2015. Ford Motor Co. v. Thermoanalytics, Inc., No. 14-CV-13992, 

2015 WL 6522857 (E.D. Mich. Oct. 28, 2015), reconsideration denied sub nom. 

Ford Motor Co. v. Thermoanalytics, Inc., No. 14-CV-13992, 2016 WL 386431 

(E.D. Mich. Feb. 2, 2016).

Before the Court is Defendant’s Motion for Partial Summary Judgment. See

Dkt. No. 67. The matter has been fully briefed. A hearing was held on June 1, 2016 

at 10:30 a.m. For the reasons discussed below, the Motion [67] is GRANTED IN 

PART and DENIED IN PART.

II. BACKGROUND

Plaintiffs and Defendant entered into a License Agreement (the 

“Agreement”) on December 31, 1998. The License Agreement defined the parties’ 

relationship with regard to thermal engineering software, known as RadTherm. 

The License Agreement was terminated on March 1, 2014. 

Between the execution of the Agreement and its termination, Defendant 

developed and sold other software in addition to RadTherm, known as Modules. 

Plaintiffs have alleged that it is entitled under the License Agreement to royalties 

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on revenues from four Modules: the Battery Module, Human Module, Advanced 

Solver, and “CAE Coupling Module.” Amended Complaint, ¶ 92. 

Plaintiffs’ recently-submitted expert damage report also contains claims 

related to software known as PowerTherm. Dkt. No. 67 at 9 (Pg. ID No. 1594). 

Defendant asserts that neither the Complaint nor the Amended Complaint contain 

any allegation regarding PowerTherm, and thus these claims should be dismissed. 

Id.

III. LEGAL STANDARD

Federal Rule of Civil Procedure 56(c) “directs that summary judgment shall 

be granted if there is no genuine issue as to any material fact and that the moving 

party is entitled to a judgment as a matter of law.” Cehrs v. Ne. Ohio Alzheimer’s 

Research Ctr., 155 F.3d 775, 779 (6th Cir. 1998) (quotations omitted). The court 

must view the facts, and draw reasonable inferences from those facts, in the light 

most favorable to the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 

242, 255 (1986). No genuine dispute of material fact exists where the record “taken 

as a whole could not lead a rational trier of fact to find for the non-moving party.” 

Matsushita Elec. Indus., Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). 

Ultimately, the court evaluates “whether the evidence presents a sufficient 

disagreement to require submission to a jury or whether it is so one-sided that one 

party must prevail as a matter of law.” Anderson, 477 U.S. at 251–52.

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IV. DISCUSSION

The Defendant has moved for Partial Summary Judgment on two separate 

issues. First, Defendant argues that royalties are not owed on specific types of 

software, known as “Modules.” Second, Defendant argues that all claims with 

regard to software known as “PowerTherm” should be denied because they were 

not included in Plaintiffs’ Complaint. 

A. The Royalties

Defendant puts forward two theories for why Plaintiffs should be prevented 

from reaping royalties on the Modules. First, Defendant argues that Plaintiffs are 

not entitled to royalties on the Modules under the Royalties provision of the 

Agreement. Dkt. No. 67 at 9 (Pg. ID No. 1594). Second, Defendant argues that 

Plaintiffs are equitably estopped from seeking royalties on the Modules. Id. at 12 

(Pg. ID No. 1597). The Court shall first address the scope of the Royalties 

provision.

“The general rules of contract law require that courts interpret contracts 

according to their plain meaning, in an ordinary and popular sense.” Gillham v. 

Tennessee Valley Auth., 488 F. App’x 80, 84 (6th Cir. 2012); Rogers v. I.R.S., No. 

15–3409, 2016 WL 2343169, *5 (6th Cir. May 4, 2016). The basic goal of contract 

interpretation is to give effect to the intent of the parties. In re AmTrust Fin. Corp., 

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694 F.3d 741, 749 (6th Cir. 2012). “Where a contract’s meaning is clear on its 

face, that meaning controls.” Id. at 750. 

The Defendant’s obligations to pay royalties are covered under Sections 4.1 

and 4.2 of the License Agreement. Section 4.2 of the Agreement provides, in 

relevant part, that Defendant must pay

. . . a Royalty to FGTI for each sale of FGTI Licensed Software, 

Licensee Licensed Software and Jointly Owned Software which are 

included as part of consulting services or the development of third 

party software Modules which operate in conjunction with any portion 

of FGTI Licensed Software, Licensee Licensed Software and Jointly 

Owned Software.

License Agreement, § 4.2. This section, Defendant argues, requires royalties to be 

paid solely for each sale of RadTherm (and other licensed software), including 

sales attached to consulting services, or sales of RadTherm included in the 

development of Modules. Plaintiffs argue that this reading of the contract makes 

the reference to Modules superfluous. Dkt. No. 77 at 24 (Pg. ID No. 2110) (“If no 

royalties were owed on any module sales under the License Agreement, as 

[ThermoAnalytics] argues, the reference to ‘modules’ in ¶ 4.2 would be 

superfluous.”). Under Plaintiffs’ interpretation, Defendant is obliged to pay a 

royalty on revenue from the sale of RadTherm included in consulting services, as 

well as revenue gained from the development of any and all third party software 

modules which operate in conjunction with RadTherm. 

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The Court finds Plaintiffs’ interpretation in conflict with the rest of the 

royalty section. First, Sections 4.1 and 4.2, revolve primarily around the sale of 

FGTI Licensed Software, Licensee Licensed Software, and the Jointly Owned 

Software. Section 4.1, which covers the basis for royalties, makes no mention of 

Modules. See License Agreement, § 4.1. It stands to reason that if the parties 

wished to include royalties on the sale and development of Modules, then they 

would have included a basis for those royalties in Section 4.1, or created a new 

section for its basis entirely.

Second, Section 4.2 subdivides each royalty obligation into distinct 

sentences based on the individual types of transactions. To illustrate, the other 

royalty obligations read as follows: 

• Licensee shall pay to FGTI an initial Royalty of Five Thousand 

($5,000) dollars, by June 30, 1999.

• Licensee shall pay a Royalty to FGTI for each Sale of each copy of 

FGTI Licensed Software, Licensee Licensed Software and Jointly 

Owned Software at a rate that is 10% of the Reference Price for the 

corresponding Sales charged to Customers by Licensee or Licensee’s 

authorized or 10% of the actual price charged, whichever is greater.

• Licensee shall also pay a Royalty to FGTI that is 10% of the 

Reference Price for the corresponding annual maintenance service 

Sales charged to Customers by Licensee or Licensee’s authorized 

distributors or 10% of the actual price charged, whichever is greater.

License Agreement, § 4.2. 

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Plaintiffs’ interpretation of the relevant language would require royalties for 

two different transactions: 1) for the sale of RadTherm in conjunction with 

consulting, and 2) the development of any Module that operates in conjunction 

with RadTherm. Therefore, Plaintiffs’ interpretation of Section 4.2’s final royalty 

obligation would break the section’s trend of describing one obligation per 

sentence. To compare, Defendant’s interpretation would continue Section 4.2’s 

trend by describing one transaction: an incidental sale of RadTherm. If the 

contracting parties wished to contract a royalty for all development of Modules, the 

rest of the section indicates that the obligation would be described in its own 

sentence. 

Next, Plaintiffs argue that Defendant’s use of the RadTherm Trademark on 

the Modules was a violation of the Lease Agreement, and thus the Motion for 

Summary Judgment should be denied. Dkt. No. 77 at 21 (Pg. ID No. 2107). While 

this argument addresses whether or not the License Agreement has been breached, 

it is non-responsive to the question of royalties owed on the Modules. Section 4.2 

of the License Agreement does not require royalties to be paid on all software 

bearing the Plaintiffs’ trademark. License Agreement, § 4.2. Defendant may owe 

damages for breach of contract, but not necessarily royalties. Therefore, this 

argument fails. 

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Plaintiffs also argue that the Modules are covered under the royalty 

provision as “works of authorship created with respect” to RadTherm, under 

Section 8.1 of the License Agreement. Dkt. No. 77 at 25 (Pg. ID No. 2111). Once 

again, this does not necessarily respond to the question of royalties, so much as it 

does the question of breach of contract. 

Section 8.1 of the License Agreement grants Plaintiffs copyrights for all 

“joint works.” License Agreement, § 8.1. It does not however grant rights to 

royalties. Id. Furthermore, the term “joint works”—distinct from “Jointly Owned 

Works”—is not utilized in Sections 4.1 or 4.2. Thus, a plain reading of the License 

Agreement suggests that no royalty obligations are owed for the revenue gained 

from “joint works.” This means that while Plaintiffs may be entitled to the 

copyrights behind the Modules, they would not be entitled to royalties for their 

sale. 

Finally, at the hearing, Plaintiffs’ counsel argued that the Modules are 

covered under the definition of Jointly Owned Software as derivative of 

RadTherm. However this argument breaks down in context with the other royalty 

obligations. If, as Plaintiffs argue, the Modules were covered under the definition 

of Jointly Owned Software, then a requirement for a royalty on the development of 

the Modules—as Plaintiffs maintain—would be superfluous. Section 4.2 already 

requires a 10% royalty on every sale of Jointly Owned Software. The Court refuses 

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to adopt Plaintiffs’ interpretation. Lockheed Martin Corp. v. Goodyear Tire & 

Rubber Co., 2012 WL 3499510, *4 (N.D. Ohio August 15, 2012) (“It is a general 

canon of contract construction that courts should not interpret a contract so as to 

render clauses superfluous.”).

A plain reading of Section 4.1 and 4.2 indicates that Plaintiffs are not 

entitled to royalties on the Modules. Accordingly, an analysis into Defendant’s 

argument for equitable estoppel is not necessary. 

B. PowerTherm

Rule 8 of the Federal Rules of Civil Procedure provides that a pleading that 

states a claim for relief must contain “a short and plain statement of the claim 

showing that the pleader is entitled to relief; and . . . a demand for the relief 

sought.” Fed. R. Civ. P. 8(a)(2), (3). The Rule further provides, “[p]leadings must 

be construed so as to do justice.” Fed. R. Civ. P. 8(e). “[I]n doing so [the Court] 

must look to the complaint ‘as a whole’ to see if it provides ‘sufficient notice’ of 

the claim.” Coley v. Lucas Cty., Ohio, 799 F.3d 530, 543 (6th Cir. 2015). 

The Defendant argues that because claims related to PowerTherm were not 

listed in the Amended Complaint, Plaintiffs may not be allowed assert them now. 

Dkt. No. 67 at 13 (Pg. ID No. 1598). In response, Plaintiffs argue that the

Complaint did in fact request relief for PowerTherm. Dkt. No. 77 at 32 (Pg. ID No. 

2118).

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In the Amended Complaint, Plaintiffs alleged that 

Defendant has breached its obligations under the License Agreement 

by refusing to “return to FGT[L] all copies of and information related 

to FGT[L] Licensed Software, and Jointly Owned Software that were 

furnished to or prepared by Licensee in connection with the rights 

Licensed under this agreement.”

Amended Complaint, ¶ 112. The Amended Complaint also states 

Defendant has breached its obligations under the License Agreement 

by refusing to assign its “individual rights, title and interest in 

copyrights in the joint works then existing to FGT[L] and Licensee as 

joint owners.”

Id. at ¶ 113 (emphasis added). 

As one can see, Plaintiffs have made claims regarding “joint works.” As 

stated in the Agreement, all derivative works of authorship, and software programs

created with respect to RadTherm are considered “joint works” under the 

Agreement. License Agreement, § 8.1. Therefore, the Complaint put Defendant on 

notice that relief was being requested for all programs that could be considered a 

“joint work.”

Plaintiffs have presented evidence that PowerTherm is derivative of 

RadTherm. Dkt. No. 77 at 31–32 (Pg. ID No. 2117–18). For example, Plaintiffs 

point to the fact that Ford’s ownership interest in the PowerTherm software is 

explicitly recognized in software agreements between ThermoAnalytics and other 

companies. Id. Plaintiffs also point to the fact that several versions of PowerTherm 

bear copyright notices identifying Ford as an owner. Id. Therefore, after the course 

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of discovery, there was sufficient evidence to put Defendant on notice that 

PowerTherm was subject to the litigation. 

Defendant asserts that because Plaintiffs only argued that PowerTherm was 

derivative of RadTherm, and did not argue that it was “created with respect” to 

RadTherm, that Plaintiffs have missed the dispositive issue. Dkt. No. 81 at 6 (Pg.

ID No. 2378). Defendant’s argument is misguided. 

In its October 28, 2015 Order Granting Plaintiffs’ Motion for Partial 

Summary Judgment, the Court made clear that the definition of a “joint work” 

included both works created with respect to RadTherm and works that are 

derivative of RadTherm. Ford Motor Co., 2015 WL 6522857, at *7 (“The Court 

finds that the Agreement extends to ‘all derivative works created with respect to 

Jointly Owned Software’ (e.g. the Original Software) and ‘all works of authorship 

created with respect to Jointly Owned Software.’ ”). Therefore, Plaintiffs have not 

missed a dispositive issue. The License Agreement covers both types of “joint 

works.” Accordingly, because the Amended Complaint puts Defendant on notice

for claims related to PowerTherm, the Defendant’s motion to bar claims relating to 

PowerTherm will be denied.

V. CONCLUSION

For the reasons discussed above, the Defendant’s Motion for Partial 

Summary Judgment [67] is GRANTED IN PART and DENIED IN PART. 

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IT IS SO ORDERED.

Dated: June 8, 2016 s/Gershwin A. Drain

Detroit, MI HON. GERSHWIN A. DRAIN 

United States District Court Judge

CERTIFICATE OF SERVICE

The undersigned certifies that the foregoing document was served upon 

counsel of record and any unrepresented parties via the Court's ECF System to 

their respective email or First Class U.S. mail addresses disclosed on the Notice of 

Electronic Filing on June 8, 2016.

s/Tanya R. Bankston

TANYA R.BANKSTON

Case Manager & Deputy Clerk

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