### In the



# United States Court of Appeals

For the Seventh Circuit

____________________

No. 19

‐ 2542

S MART O IL

, LLC,

Plaintiff

‐ Appellee

,

v.

DW M AZEL

, LLC,

Defendant

‐ Appellant

.

____________________

Appeal from the United States District Court for the

Northern District of Illinois, Eastern Division.

No. 1:15

‐ cv

‐ 08146

— Harry D. Leinenweber

, Judge

.

____________________

A RGUED M AY 21, 2020

— D ECIDED A UGUST 17, 2020

____________________

Before M ANION

, B ARRETT

, and B RENNAN

, Circuit Judges

.

B RENNAN

, Circuit Judge

. Smart Oil, LLC agreed to sell

thirty parcels of land with gas stations and convenience stores

to DW Mazel, LLC (“DWM”). DWM failed to close under the

agreement, which by its terms granted Smart Oil the earnest

money for the transaction as liquidated damages. But DWM

never paid that money, and Smart Oil sued. DWM counter

‐

claimed for breach of contract and fraudulent inducement.2 No. 19

‐ 2542

The district court granted Smart Oil summary judgment,

ruling that DWM breached the agreement by not paying the

earnest money, which Smart Oil was entitled to as liquidated

damages under Illinois law. The court also ruled that DWM’s

counterclaims for breach of contract and fraudulent induce

‐

ment failed for the same reason. DWM appeals. The district

court ruled correctly in all respects, so we a ffi rm.

I. B ACKGROUND

During 2014, Smart Oil’s sole member, Mehmood Syed,

marketed for sale numerous properties with gas stations and

convenience stores. After lengthy negotiations, Smart Oil and

DWM executed a Purchase and Sale Agreement and Joint Es

‐

crow Instructions (the “Agreement”) by which DWM agreed

to purchase thirty such parcels of real property for $67 mil

‐

lion. Both parties were represented by counsel throughout the

negotiations.

The Agreement requires DWM to initially deposit

$300,000 into an escrow account. That deposit was to take

place during a due diligence period following acceptance of

the Agreement. The Agreement obliges the escrow account

holder to transfer that deposit to the title company. Then, at

the close of the due diligence period, DWM is to pay a second

deposit of $450,000 to the title company. The total earnest

money of $750,000 is about one percent of the total purchase

price.

DWM never paid the initial earnest money deposit. De

‐ spite DWM’s failure to do so, the parties continued their due

diligence investigations and negotiations. By the close of the

due diligence period, the Agreement requires DWM to pro

‐

vide Smart Oil with wri tt en notice if, after its investigations,No. 19

‐ 2542 3

DWM disapproved of the purchase. If DWM had provided

this wri tt en notice, the Agreement would have terminated,

and the earnest money would have been returned to DWM. If

DWM did not provide that wri tt en notice, section 4(a)(i) of the

Agreement states that such “failure to timely deliver [wri tt en]

notice [of its disapproval] shall be deemed Buyer’s approval

of such investigations,” and Smart Oil would be entitled to

keep the earnest money if the deal otherwise fell through.

DWM asserts it negotiated with Smart Oil to lengthen the due

diligence period, extending the time to provide wri tt en notice

of disapproval. Regardless, DWM failed to provide wri tt en

notice of disapproval, which DWM does not dispute. At the

close of the due diligence period, DWM also did not pay the

second deposit.

In the meantime, Syed contacted property owners about

selling their properties to Smart Oil which would then sell

them in the aggregate to DWM. This is known as a “ fl ip deal,”

and according to Smart Oil was contemplated under section

17(c) of the Agreement, which states in bold: “The parties

acknowledge that Seller is the holder of a portfolio of gas sta

‐

tion businesses, real estate and/or leases and only nominal ti

‐

tle holder for purposes of transferring title to the Buyer.” To

make good on its end of the Agreement, Smart Oil executed

contracts with various property owners for the sale of their

properties.

Ultimately, DWM failed to close under the terms of the

Agreement and the parties’ deal fell through. The individual

property owners did not sell their properties to Smart Oil un

‐

der the individual contracts, and Smart Oil never fl ipped

those properties to DWM.4 No. 19

‐ 2542

Smart Oil sued DWM for breach of contract, arguing it was

entitled to $750,000 in earnest money as liquidated damages

under the following term: “If Buyer defaults in its perfor

‐

mance

... under this Agreement, including the obligation of

Buyer to purchase the Property if all conditions precedent to

such obligations has been satis fi ed, Seller shall receive the en

‐

tire Earnest Money Deposit and all accrued interest thereon

as complete liquidated damages.” The Agreement explains

the need for liquidated damages in conspicuous language: “IT

BEING UNDERSTOOD THAT THE DAMAGE TO SELLER

CAUSED BY ANY SUCH DEFAULT OF BUYER WOULD BE

EXTREMELY DIFFICULT TO OR IMPOSSIBLE TO

ASCERTAIN.” The liquidated damages clause survives ter

‐

mination of the contract per section 17(a). Both parties signed

under that clause demonstrating their consent and agree

‐

ment.

DWM counterclaimed for breach of contract and fraudu

‐

lent inducement, asserting Smart Oil failed to perform condi

‐

tions precedent under the Agreement and deceived DWM

into executing the Agreement. According to DWM, Smart Oil

did not have authority to convey the properties and failed to

provide adequate due diligence materials. After discovery

both parties moved for summary judgment.

The district court ruled that Smart Oil satis fi ed all condi

‐

tions precedent of the Agreement and that DWM breached

the contract by not paying the earnest money. First, the court

found that Smart Oil had authority to convey the properties,

relying on numerous sworn statements from property owners

verifying that they were ready to sell the properties to Smart

Oil for Smart Oil to “ fl ip” them to DWM. Second, the court

found that DWM failed to give wri tt en notice of disapprovalNo. 19

‐ 2542 5

of the due diligence investigations, and that failure was

“deemed Buyer’s approval of such investigations” under Sec

‐

tion 4(a)(i) of the Agreement. Because DWM approved of the

due diligence materials under the Agreement, Smart Oil sat

‐

is fi ed its condition precedent for due diligence disclosures. So

DWM’s obligation to pay the earnest money remained, and

DWM admits it never paid.

The district court also held that Smart Oil was entitled to

the earnest money as liquidated damages under Illinois law,

noting that DWM’s representative signed the liquidated dam

‐

ages clause that explicitly stated actual damages would be ex

‐ tremely di ffi cult or impossible to ascertain. The court found

the liquidated damages fi gure to be a fair and reasonable

amount and granted Smart Oil’s motion for summary judg

‐

ment.

The district court also denied DWM’s cross

‐ motion for

summary judgment on its breach of contract and fraudulent

inducement claims. Construing the facts in the light most fa

‐

vorable to Smart Oil, the court found that the property owners

authorized Smart Oil to e ff ectuate the fl ip transactions and

that they were ready to sell their properties to DWM. The

Agreement includes a prevailing party a tt orneys’ fees and

costs provision, under which the court granted fees and costs

to Smart Oil. DWM appeals.

II. D ISCUSSION

As a federal court sitting in diversity, we honor the Agree

‐

ment’s choice

‐ of

‐ law clause specifying Illinois law as control

‐ ling, unless to do so would be contrary to public policy. Life

Plans, Inc. v. Sec. Life of Denver Ins. Co.

, 800 F.3d 343, 357 (7th

Cir. 2014). We review the district court’s decision granting6 No. 19

‐ 2542

summary judgment de novo, construing the facts in a light

favorable to the non

‐ moving party. Westfield Ins. Co. v. Nat’l

Decorating Serv., Inc.

, 863 F.3d 690, 694–95 (7th Cir. 2017).

A. Breach of Contract

Under Illinois law, a plainti ff suing for breach of contract

must prove: (1) the contract existed, (2) the plainti ff per

‐

formed the conditions precedent required by the contract,

(3) the defendant breached the contract, and (4) damages.

DeliverMed Holdings, LLC v. Schaltenbrand

, 734 F.3d 616, 626

(7th Cir. 2013) (citing Law O ffi ces of Colleen M. McLaughlin v.

First Star Fin. Corp.

, 963 N.E.2d 968, 981 (Ill. App. Ct. 2011)).

The parties agree a contract exists, and they also agree

DWM never paid the earnest money. They disagree whether

Smart Oil performed its conditions precedent under the

Agreement. DWM asserts Smart Oil’s breach of contract claim

fails because DWM is excused from paying the earnest

money. DWM reasons that Smart Oil is only entitled to keep

the earnest money under Section 17(a) of the Agreement if it

has satis fi ed conditions precedent, which DWM alleges Smart

Oil failed to do. Smart Oil’s alleged failure to satisfy its condi

‐

tions precedent is also the basis for DWM’s breach of contract

counterclaim.

A “condition precedent is one that must be met before a

contract becomes e ff ective or that is to be performed by one

party to an existing contract before the other party is obligated

to perform.” Catholic Charities of the Archdiocese of Chicago v.

Thorpe

, 741 N.E.2d 651, 653 (Ill. App. Ct. 2000) (quoting

McAnelly v. Graves

, 467 N.E.2d 377, 379 (Ill. App. Ct. 1984)).

Section 4 of the Agreement provides that DWM’s obligation

to consummate the transaction is subject to the followingNo. 19

‐ 2542 7

conditions precedent for DWM’s bene fi t: (1) due diligence in

‐ vestigations and materials; (2) title insurance commitments

for each of the properties; (3) inventories of the personal prop

‐

erty for each of the businesses; and (4) that Smart Oil’s repre

‐

sentations and warranties were truthful and accurate under

Section 15 of the Agreement. DWM argues Smart Oil failed to

satisfy two of these conditions: it did not have authority to

convey the properties, and it failed to produce the requisite

due diligence materials. Both arguments fail, however.

First, Smart Oil has shown that it had authority to execute

the Agreement. Section 17(c) of the Agreement states in bold:

“The parties acknowledge that Seller is the holder of a portfo

‐

lio of gas station businesses, real estate and/or leases and only

nominal title holder for purposes of transferring title to the

Buyer.” To e ff ectuate the “ fl ip deal” contemplated by the

Agreement, Smart Oil executed contracts with numerous

property owners for the sale of their properties, which would

then be sold to the aggregate purchaser, DWM. To prove

Smart Oil had authority to execute the Agreement, Smart Oil

provided sworn statements from owners of 21 of the 30 prop

‐

erties. They declared under penalty of perjury they were

ready and willing to sell their properties to carry out the

Agreement and that Smart Oil had authority to fl ip the prop

‐

erties to DWM. As for the remaining nine properties, DWM

has not produced any evidence to show that Smart Oil did not

have authority to do a “ fl ip deal” or that Smart Oil misled

DWM. Nevertheless, DWM maintains that Smart Oil failed to

“produce the necessary evidence to establish that it had the

actual legal right and authority to sell 30 Gas Stations to

DWM” because Smart Oil’s discovery production was “nine

short of the 30 Gas Stations.”8 No. 19

‐ 2542

The Agreement does not require Smart Oil to submit the

speci fi c proof that DWM requests. On its breach of contract

claim Smart Oil must prove it satis fi ed its conditions prece

‐

dent by a preponderance of the evidence. Extra Equipamentos

E Exportacao Ltda. v. Case Corp.

, 541 F.3d 719, 724 (7th Cir. 2008)

(noting “all that is required to prove a breach of contract”

claim in Illinois is “preponderance of the evidence”). Submit

‐ ting declarations from more than two

‐ thirds of the property

owners—with no evidence to the contrary for the remaining

properties and no evidence that Smart Oil deceived DWM—

satis fi es that standard.

Second, even if Smart Oil failed to provide DWM with the

requisite due diligence materials—which we do not con

‐

clude—DWM approved Smart Oil’s due diligence disclosures

by not submi tt ing wri tt en notice of disapproval. Sec

‐

tion 4(a)(i) of the Agreement states: “On or before the expira

‐

tion of the Due Diligence Period, Buyer shall deliver to Seller;

Buyer’s wri tt en notice of its disapproval of its due diligence

investigations for the Property. Buyer’s failure to timely de

‐

liver such notice shall be deemed Buyer’s approval of such in

‐ vestigations.” DWM argues the parties agreed to an extension

of the due diligence period. Even if so, an extension is not

wri tt en notice of disapproval. Had DWM provided such no

‐

tice, the Agreement would have terminated, and DWM could

have recovered the earnest money. But that is not what hap

‐ pened, so DWM’s obligation to pay the earnest money re

‐

mains unful fi lled.

DWM argues even if it did not provide wri tt en notice of

disapproval under section 4(a)(i), Smart Oil is still not entitled

to the earnest money because section 4(a)(i) “does not address

the recovery of liquidated damages, but instead the e ff ect ofNo. 19

‐ 2542 9

DWM’s wri tt en disapproval of due diligence materials.” This

argument is misplaced. DWM contends Smart Oil failed to

satisfy a condition precedent by not submi tt ing proper due

diligence materials. DWM’s lack of wri tt en notice of disap

‐ proval under Section 4(a)(i), which per the Agreement indi

‐

cated DWM approved Smart Oil’s due diligence materials,

rebuts DWM’s assertion that Smart Oil failed to satisfy its con

‐

ditions precedent.

Because Smart Oil satis fi ed its conditions precedent under

the Agreement, DWM breached the contract by not paying

the earnest money. DWM’s counterclaim for breach of con

‐

tract fails for the same reason. We turn next to the question

whether Smart Oil is entitled to the earnest money as liqui

‐

dated damages.

B. Liquidated Damages

A liquidated damages clause provides a predetermined

remedy in the event a party breaches. McNamara v. O’Donnell

Haddad LLC

, 2016 IL App (2d) 150519

‐ U, ¶28. “This predeter

‐

mined amount may or may not exceed the actual damages

and both parties agree to accept this inherent risk.” Id. An un

‐ reasonably large liquidated damages clause is unenforceable

under Illinois law on grounds of public policy. Id. Liquidated

damages clauses in real estate contracts are common to avoid

the difficulty of proving damages by methods such as market

value, resale value, or otherwise. Karimi v. 401 N. Wabash

Venture, LLC

, 2011 IL App (1st) 102670, ¶16 (citing Siegel v.

Levy Organization Dev. Co.

, 538 N.E.2d 715, 717 (Ill. App. Ct.

1989)).

Whether a liquidated damages clause in a contract is a

penalty or a valid provision is a question of law. Grossinger10 No. 19

‐ 2542

Motocorp, Inc. v. Am. Nat’l Bank & Trust Co.

, 607 N.E.2d 1337,

1345 (Ill. App. Ct. 1992). The burden of proof “rests on the

party resisting enforcement of a liquidated damages clause to

show that the agreed

‐ upon damages are clearly dispropor

‐

tionate to a reasonable estimate of the actual damages likely

to be caused by a breach.” XCO Int’l, Inc. v. Pac. Sci. Co.

, 369

F.3d 998, 1003 (7th Cir. 2003). Here, that burden rests on

DWM.

Under Illinois law, a liquidated damages clause is valid

and enforceable if: (1) the parties intended to agree in advance

to the settlement of damages that might arise from the breach;

(2) the amount of liquidated damages was reasonable at the

time of contracting, bearing some relation to the damages that

might occur; and (3) actual damages would be uncertain in

amount and difficult to prove. Karimi

, 2011 IL App (1st)

102670, ¶16 (citing Grossinger

, 607 N.E.2d at 1346). “The rea

‐

sonableness of the amount, though, depends not on the actual

damages suffered by the non

‐ breaching party, but on whether

the amount reasonably forecasts and bears some relation to

the parties’ potential loss as determined at the time of con

‐ tracting.” Id. ¶24

Illinois’s requirement that liquidated damages be reason

‐

able has been characterized as “mysterious,” especially in

cases involving sophisticated parties. XCO Int’l, Inc.

, 369 F.3d

at 1001. “[W]here both parties are substantial commercial en

‐ terprises

... it is difficult to see why the law should take an

interest in whether the estimate of harm underlying the liqui

‐

dation of damages is reasonable. Courts don’t review the

other provisions of contracts for reasonableness; why this

one?” Id. Yet the rule against contractual penalties “hangs on,

but is chastened by an emerging presumption againstNo. 19

‐ 2542 11

interpreting liquidated damages clauses as penalty clauses.”

Id. at 1003.

We do not forget that state courts are the “ultimate expos

‐

itors” of their own laws. Mullaney v. Wilbur

, 421 U.S. 684, 691

(1975); see, e.g.

, Lexington Ins. Co. v. Rugg & Knopp, Inc.

, 165

F.3d 1087, 1093 (7th Cir. 1999) (“Lacking any inherent power

to make state law such as a state court might have

... a federal

court must be careful to avoid the temptation to impose upon

a state what it, or other jurisdictions, might consider to be

wise policy.”). So we do not opine on whether Illinois’s liqui

‐

dated damages law constitutes wise policy; we only apply it.

Here, the Agreement states if DWM fails to purchase the

properties, Smart Oil “shall receive the entire Earnest Money

Deposit and all accrued interest thereon as complete liqui

‐

dated damages.” The Agreement further explains the ra

‐

tionale for liquidated damages in conspicuous language that

damages to Smart Oil caused by DWM’s default “WOULD BE

EXTREMELY DIFFICULT TO OR IMPOSSIBLE TO

ASCERTAIN.” Both parties signed immediately below the

liquidated damages clause, demonstrating their consent and

agreement to the provision.

The plain language of the Agreement satis fi es two of the

three elements for liquidated damages under Illinois law.

Speci fi cally, the Agreement states that the parties’ signature

under the liquidated damages clause demonstrated their con

‐

sent and agreement to the provision, satisfying the fi rst

element that “the parties intended to agree in advance to the

se tt lement of damages that might arise from the breach.”

Karimi

, 2011 IL App (1st) 102670, ¶16. The Agreement also sat

‐

is fi es the third element that “actual damages would be uncer

‐

tain in amount and di ffi cult to prove” by explicitly stating:12 No. 19

‐ 2542

“DAMAGE TO SELLER

... WOULD BE EXTREMELY

DIFFICULT TO OR IMPOSSIBLE TO ASCERTAIN.” What re

‐

mains is to evaluate the second element, the reasonableness of

the damages amount.

The liquidated damages amount here was $750,000, or ap

‐ proximately one percent of the contractual purchase price of

$67 million. Under Illinois law, a liquidated damages clause

of one percent of the purchase price is reasonable, given that

Illinois “[c]ourts have considered earnest money representing

up to 20% of the purchase price a reasonable sum as liqui

‐

dated damages.” Karimi

, 2011 IL App (1st) 102670, ¶24 (hold

‐ ing earnest money of 15% of the purchase price in real estate

contract was reasonable liquidated damages); see, e.g.

, Siegel v.

Levy Org. Dev. Co.

, 182 Ill. App. 3d 859, 860–63 (Ill. App. Ct.

1989) (holding earnest money of $320,000 on a $1,600,000 con

‐

tract, representing two percent of the purchase price, was rea

‐ sonable). One percent of the Agreement’s purchase price is

not “clearly disproportionate” under XCO Int’l, Inc.

, 369 F.3d

at 1003.

DWM argues the liquidated damages clause is unenforce

‐

able because Smart Oil has not incurred any actual damages.

But whether Smart Oil ultimately incurred any actual dam

‐

ages is not relevant to the reasonableness decision, and actual

damages are not required under Illinois law before liquidated

damages can be assessed. See, e.g.

, Kensington Rock Island Ltd.

P’ship v. Am. Eagle Historic Partners

, 921 F.2d 122, 124 (7th Cir.

1990) (noting the “Illinois rule is clear” that plainti ff was enti

‐

tled to earnest money in real estate contract because of buyer’s

default regardless of the amount of actual damages which

may have resulted); Bamberg v. Gri ffi n

, 394 N.E.2d 910, 914 (Ill.

App. Ct. 1979) (noting “it has been long established in IllinoisNo. 19

‐ 2542 13

that the provision for earnest money in a contract, in the ab

‐

sence of an express provision to the contrary, will be inter

‐ preted as a provision for liquidated damages and enforced

without actual proof of damages required”). The only re

‐ quirement under Illinois law is whether, at the time of con

‐ tracting, the damages amount was reasonable in that it bore

some relation to the damages that might occur. Karimi

, 2011

IL App (1st) 102670, ¶16. The liquidated damages fi gure here

meets that test. “The nature of a liquidated damages provi

‐

sion is such that the set amount may at times exceed actual

damages, and other times actual damages may exceed the set

amount. In entering into the purchase agreement, both parties

here agreed to accept this inherent risk.” Id. ¶27. Here, the set

amount was a minor fraction of the damages amount.

DWM also contends Smart Oil is not entitled to the earnest

money because the Agreement limits Smart Oil’s recovery to

the amount actually deposited in escrow. Because DWM

never deposited the earnest money, it claims there is nothing

for Smart Oil to recover. The liquidated damages provision

states in unambiguous terms: “Seller shall receive the entire

Earnest Money Deposit and all accrued interest thereon as

complete liquidated damages.” The Agreement de fi nes

“Earnest Money Deposit” as “the Deposit and the Additional

Deposit,” which was the $300,000 initially due then the addi

‐

tional $450,000 at the close of the due diligence period.

This court (like others) has consistently interpreted “shall”

as mandatory language. See, e.g.

, Judge v. Quinn

, 612 F.3d 537,

547 (7th Cir. 2010) (noting that “shall” is “normally under

‐

stood as mandatory language”); Thompson v. Veach

, 501 F.3d

832, 836 (7th Cir. 2007) (discussing “shall” as mandatory lan

‐ guage); Paper Express, Ltd. v. Pfankuch Maschinen GmbH

, 97214 No. 19

‐ 2542

F.2d 753, 756 (7th Cir. 1992) ( fi nding use of the word “shall”

in a contract “mandatory” and “obligatory”). Black’s Law

Dictionary de fi nes “shall” as “has a duty to, more broadly is

required to” and explains that “[t]his is the mandatory sense

that drafters typically intend and that courts typically up

‐

hold.” B LACK ’ S L AW D ICTIONARY 1653 (11th ed. 2019). Alt

‐ hough the Agreement describes the earnest money due as the

“Deposit,” it does not limit liquidated damages to funds actu

‐ ally deposited. And the language of “shall receive the entire

Earnest Money Deposit” is mandatory, even if DWM did not

already deposit the money. Because DWM failed to close on

the transaction, by the plain language of the Agreement,

Smart Oil “shall receive the entire Earnest Money Deposit and

all accrued interest thereon as complete liquidated damages.”

DWM’s argument that it does not have to pay the earnest

money deposit because it never paid it in the fi rst instance

would result in the absurd outcome of wrongdoers being ab

‐

solved of their debts simply by not paying them. DWM “can

‐

not insist on abandoning [its] contract and yet [not pay] the

deposit because that would enable [it] to take advantage of

[its] own wrong.” Summers v. Hedenber

, 198 Ill. App. 460, 467

(1916).

Our role “in interpreting a contract is to give effect to the

intention of the parties as expressed in the agreed terms.” Life

Plans, Inc.

, 800 F.3d at 349. “The first and most reliable indica

‐

tor of the parties’ intent is what the parties wrote.” Ocean Atl.

Dev. Corp. v. Aurora Christian Schs., Inc.

, 322 F.3d 983, 1006 (7th

Cir. 2003) (citing Venture Assocs. Corp. v. Zenith Data Sys. Corp.

,

987 F.2d 429, 432 (7th Cir. 1993)). The parties here are sophis

‐

ticated commercial enterprises that engaged in extensive,

arms

‐ length negotiations and, with the advice of counsel,No. 19

‐ 2542 15

reached an agreement. When experienced businesses agree to

a liquidated damages clause that satisfies the requirements of

Illinois law, we hold the parties to their bargained deal.

C. Fraudulent Inducement

Finally, DWM argues the district court erred by dismiss

‐ ing its fraudulent inducement counterclaim. DWM asserts

Smart Oil knowingly made false statements concerning its

ability to complete a sale under the Agreement. To prove

fraudulent inducement under Illinois law, DWM must show:

(1) a false statement of material fact; (2) knowledge or belief

by Smart Oil that the statement was false; (3) an intention to

induce DWM to act; (4) reasonable reliance upon the truth of

the statement by DWM; and (5) damages. Avon Hardware Co.

v. Ace Hardware Corp.

, 998 N.E.2d 1281, 1287 (Ill. App. Ct. 2013)

(citing Lagen v. Balcor Co.

, 653 N.E.2d 968, 973 (Ill. App. Ct.

1995)). These elements must be proved by clear and convinc

‐ ing evidence. Hoseman v. Weinschneider

, 322 F.3d 468, 476 (7th

Cir. 2003). Again, we review the district court’s grant of sum

‐

mary judgment de novo in the light most favorable to the non

‐

movant, here Smart Oil. West fi eld Ins. Co.

, 863 F.3d at 694–95.

The district court opined “[t]here is not much, if anything

at all, by way of showing that Smart Oil fraudulently induced

DWM to enter into the [] Agreement.” That has not changed

on appeal. Construing the facts in the light most favorable to

the non

‐ movant on this request, Smart Oil, the record shows

that the property owners were ready and willing to sell their

properties to DWM to ful fi ll the Agreement. As discussed

above, Smart Oil had authority to purchase these properties

and then “ fl ip” them to DWM as the ultimate buyer. So

DWM’s fraudulent inducement claim fails as a ma tt er of law.16 No. 19

‐ 2542

III. C ONCLUSION

Smart Oil satis fi ed all conditions precedent under the

Agreement. DWM breached the contract by failing to pay the

earnest money due, which constitutes valid liquidated dam

‐

ages under Illinois law. And DWM’s counterclaims, including

for fraudulent inducement, fail as a ma tt er of law. So we

A FFIRM the judgment of the district court.

As noted above, the Agreement contains a clause shifting

a tt orneys’ fees and costs to the prevailing party. Having pre

‐

vailed on appeal, Smart Oil has 14 days to submit its re

‐ quested a tt orneys’ fees and costs, and DWM has 14 days to

respond.