Court Opinion

ID: 2709646
Source: CourtListenerOpinion
Date Created: 2014-08-05 15:18:28.402418+00
Date Added: 2024-06-11T09:34:22.237720
License: Public Domain

In the

United States Court of Appeals
               For the Seventh Circuit

Nos. 12-1035 & 12-1036

JUDSON A TKINSON C ANDIES, INCORPORATED ,

                                                Plaintiff-Appellant,
                                 v.

K ENRAY A SSOCIATES, INCORPORATED ,
C HARLES A. M C G EE AND K ENNETH J. M C G EE,

                                             Defendants-Appellees.

             Appeals from the United States District Court
      for the Southern District of Indiana, New Albany Division.
                   Nos. 02 CV 00242, 03 CV 00012—
              William G. Hussmann, Jr., Magistrate Judge.

      A RGUED JANUARY 17, 2013—D ECIDED JUNE 11, 2013

 Before M ANION and T INDER, Circuit Judges, and L EE,
District Judge. 
 L EE, District Judge. In settling two lawsuits, Judson
Atkinson Candies, Inc., and Kenray Associates, Inc.,


   Honorable John Z. Lee, of the Northern District of Illinois,
is sitting by designation.
2                                   Nos. 12-1035 & 12-1036

entered into an agreement, which required Kenray to
pursue its insurer for coverage of Atkinson’s claims.
But when Kenray’s attempts failed, Atkinson sought
to invalidate the agreement, alleging that it had been
fraudulently induced to enter into it. Because the agree-
ment contained an integration clause, the district court,
applying Indiana law, established a bright-line rule,
requiring Atkinson to demonstrate that it had been in-
duced by fraud to enter into the integration clause
itself, as opposed to the agreement as a whole, in order
to circumvent the parol evidence rule. Because Indiana
law does not impose such a bright-line rule, we reverse.

                      I. Background
  Judson Atkinson Candies, Inc., and Atkinson Candy
Company (collectively “Atkinson”) filed two separate
lawsuits in the United States District Court for the
Eastern District of Texas against Kenray Associates, Inc.,
Charles A. McGee, and Kenneth J. McGee (collectively
“Kenray”), alleging that Kenray had failed to satisfy
certain technology agreements and representations
made therein. The cases were subsequently transferred
to the United States District Court for the Southern
District of Indiana and consolidated for the purposes of
trial. For its part, Kenray also initiated a separate action
against its insurance carrier, Hoosier Insurance Com-
pany, in the Superior Court for Floyd County, Indiana,
seeking insurance coverage for Atkinson’s claims.
  In December 2004, during the pendency of the trial in
their consolidated cases, Atkinson and Kenray settled
Nos. 12-1035 & 12-1036                                      3

the lawsuits against one another. As part of the settle-
ment, Kenray agreed to the entry of judgments against
it and in favor of Atkinson. At the same time, the
parties entered into a “Covenant Not To Execute,”
whereby Atkinson agreed not to execute on the judg-
ments if Kenray pursued the coverage action against
Hoosier and otherwise complied with the terms of the
Covenant, even if the Indiana courts eventually found
in Hoosier’s favor. Kenray also agreed to assign to
Atkinson any claims it may have had against its
insurance agent. Notably for present purposes, the
Covenant contained the following language: “The
parties agree this agreement represents the parties’ sole
agreement.”
   In Kenray’s lawsuit against Hoosier, the Floyd County
Superior Court found that no insurance coverage
existed for Atkinson’s claims and entered judgment in
favor of Hoosier in January 2007. On October 3, 2007, the
Indiana Court of Appeals upheld the decision, and the
Indiana Supreme Court denied transfer on January 17,
2008, effectively ending the coverage litigation. See
Kenray Assocs., Inc. v. Hoosier Ins. Co., 874 N.E.2d 406 (Ind.
Ct. App. 2007); Kenray Assocs., Inc. v. Hoosier Ins. Co., 891
N.E.2d 36 (Ind. 2008). Meanwhile, in June 2007, Atkinson
filed a lawsuit against Kenray’s insurance agent as-
serting Kenray’s errors and omissions claims. In March
2010, the insurance agent prevailed on summary judgment.
  On January 14, 2011, foreclosed from recovering any
funds from Hoosier and Kenray’s insurance agent,
Atkinson went back to the district court that presided
4                                 Nos. 12-1035 & 12-1036

over the original lawsuits between itself and Kenray
and filed a motion to set aside the Covenant. Atkinson
argued that it was fraudulently induced to enter into
the Covenant and only did so based upon representa-
tions from Kenray that its insurance agent had con-
firmed that Kenray had insurance coverage for Atkinson’s
claims. Atkinson further argued that Kenray’s repre-
sentations were made with the knowledge that, in fact,
the insurance agent had advised Kenray that Hoosier
would likely deny the claim, and that Kenray inten-
tionally withheld this information from Atkinson.
  In response, Kenray argued that because the Covenant
contained an integration clause that precluded Atkin-
son’s reliance upon any oral representations made by
Kenray prior to its execution, Atkinson’s fraudulent
inducement claim failed.
  On June 29, 2011, the Magistrate Judge, to whose juris-
diction the parties consented, indicated that he would
likely deny Atkinson’s motion to set aside the Covenant
and took it under advisement. In its order, the court
held that because the Covenant contained an unambigu-
ous integration clause, parol evidence could not be con-
sidered to vary the terms of the agreement. However,
the court also held that if Atkinson could demonstrate
that there was fraud in the inducement specific to the
integration clause, rather than as to the agreement as a
whole, then Atkinson might still be able to circumvent
the parol evidence rule and prevail on its claim. Because
the parties had not addressed this particular issue in
their briefs, the court scheduled an evidentiary hearing
Nos. 12-1035 & 12-1036                                   5

as to this limited point, concluding, “absent a showing
by Atkinson that there was fraud in the inducement of
the clause itself, the integration clause will prohibit
the court from doing anything other than enforcing
the [C]ovenant as written.”
   Confronted with the court’s order, Atkinson moved to
cancel the evidentiary hearing. Although it remained
steadfast that it had been fraudulently induced to enter
into the Covenant as a whole, Atkinson conceded that
it could not establish fraudulent inducement as to
the integration clause itself. On December 13, 2011,
the court denied Atkinson’s motion to set aside the
Covenant “because Plaintiff is unable to show that there
was fraud in the inducement of the [integration] clause
itself” and confirmed its June 29, 2011, order as the
final order. Atkinson timely appealed.

                     II. Discussion
  On appeal, Atkinson argues that the district court
misapplied Indiana law when it required Atkinson to
provide evidence of fraudulent inducement in connec-
tion with the execution of the integration clause itself,
rather than as to the Covenant as a whole, in order to
overcome the parol evidence rule. Not surprisingly,
Kenray responds that the district court properly
applied the law in denying Atkinson’s motion.
 As a preliminary matter, the parties agree that this
Court’s review of the district court’s denial of Atkinson’s
motion is conducted de novo, because the district court
6                                   Nos. 12-1035 & 12-1036

treated the motion as one for summary judgment. Ziliak
v. Astra Zeneca, L.P., 324 F.3d 518, 520 (7th Cir. 2003).
The parties further agree that Indiana state law governs
this dispute, and the Court concurs. See Deckard v. General
Motors Corp., 307 F.3d 556, 560 (7th Cir. 2002) (where “case
arises from the diversity jurisdiction of a federal court
sitting in Indiana,” principles of Indiana law apply).
Accordingly, it is to Indiana law that we turn.

    A. Integration Clauses and the Parol Evidence Rule
  We start with the general principle of Indiana law that
“where the parties to an agreement have reduced the
agreement to a written document and have included an
integration clause that the written document embodies
the complete agreement between the parties . . . the
parol evidence rule prohibits courts from considering
parol or extrinsic evidence for the purpose of varying
or adding to the terms of the written contract.” Krieg
v. Hieber, 802 N.E.2d 938, 943 (Ind. Ct. App. 2004). When
examining the impact of an integration clause, the court
is to consider the integration clause “as any other
contract provision to determine the intention of the
parties and to determine if that which they intended to
contract to is fully expressed in the four corners of the
writing.” Franklin v. White, 493 N.E.2d 161, 166 (Ind. 1986).
  Because an integration clause “is only some evidence
of the parties’ intentions,” the court “should consider an
integration clause along with all other relevant evidence
on the question of integration.” Id. As such, the mere
Nos. 12-1035 & 12-1036                                      7

inclusion of an integration clause “does not control the
question of whether a writing is or was intended to be a
completely integrated agreement.” America’s Directories
Inc. v. Stellhorn One Hour Photo, Inc., 833 N.E.2d 1059, 1067
(Ind. Ct. App. 2005). In the end, “the weight to be
accorded an integration clause will vary, depending on
the facts and circumstances of each particular case.”
Franklin, 493 N.E.2d at 166. And the court is “to hear
all relevant evidence, parol or written” in making this
determination. Id. at 167.

    B. The Fraudulent Inducement Exception to the
       Parol Evidence Rule
  Another long-established principle of Indiana law
provides that the parol evidence rule will not apply “in
the case of fraud in the inducement, where a party
was ‘induced’ through fraudulent representations to
enter a contract.” Circle Centre Dev. Co. v. Y/G Ind., L.P.,
762 N.E.2d 176, 179 (Ind. Ct. App. 2002) (citing Ruff v.
Charter Behavioral Health Sys. of Nw. Ind., 699 N.E.2d
1171, 1174 (Ind. Ct. App. 1994)); see Lightning Litho, Inc. v.
Danka Indus., Inc., 776 N.E.2d 1238, 1241 (Ind. Ct. App.
2002) (“Fraudulent inducement occurs when a party
is induced through fraudulent misrepresentations to
enter into a contract.”).1 The “general principle” is that

1
   To prove fraudulent inducement, Atkinson must demonstrate
that Kenray made a false material representation of fact; that
it was made with knowledge or reckless disregard of its
                                               (continued...)
8                                    Nos. 12-1035 & 12-1036

“fraud vitiates all contracts.” Prall v. Ind. Nat’l Bank,
627 N.E.2d 1374, 1378 (Ind. Ct. App. 1994).
  The question before us then lies at the intersection of
these two legal principles. To wit, where a party to a
contract alleges fraudulent inducement and the contract
in question has a valid integration clause, must the
party demonstrate that it was fraudulently induced to
agree to the integration clause itself before it can rely
upon prior representations to vitiate the contract, or is
it sufficient for a party to show that it was fraud-
ulently induced to enter into the contract as a whole?
Relying upon Circle Centre, 762 N.E.2d 176, the district
court found that, before Atkinson could invoke any
parol evidence, it had to show that it had been fraudu-
lently induced to agree to the integration clause it-
self. Because we believe that this is too narrow a
reading of Indiana law, we reverse.

    C. Prall, Circle Centre, and Their Progeny
  In beginning our analysis, we note that the Indiana
Supreme Court has not yet spoken on this particular
issue. “Where the state supreme court has not ruled
on an issue, decisions of the state Court of Appeals

1
  (...continued)
falsity with an intent to deceive; and that Atkinson
reasonably relied upon the misrepresentation, which was the
proximate cause of its injury. Bilimoria Computer Sys., LLC v.
Am. Online, Inc., 829 N.E.2d 150, 155 (Ind. Ct. App. 2005).
Nos. 12-1035 & 12-1036                                    9

control, unless there are persuasive indications that the
state supreme court would decide the issue differently.”
Lexington Ins. Co. v. Rugg & Knopp, Inc., 165 F.3d 1087,
1090 (7th Cir. 1999) (citing Allen v. Transamerica Ins. Co.,
128 F.3d 462, 466 (7th Cir. 1997)). Therefore, we are left
to parse the recent Indiana Court of Appeals decisions
that touch upon this issue. Before considering the
holding in Circle Centre, however, we begin with the
case upon which that court relied: Prall v. Indiana
National Bank.
  Fred Prall had sued The Indiana National Bank
(“INB”) for breach of contract, and INB had counter-
claimed for default of a loan agreement. The parties
eventually settled the lawsuit and entered into a mutual
release agreement, in which Prall agreed to release all
claims, known or unknown, against INB in connection
with the project from which the dispute arose. Prall, 627
N.E.2d at 1376. The release agreement expressly stated
that “this document contains the entire agreement
between the parties hereto and no representation or
promises, other than those contained or referred herein,
have been made by any party to any other party to
secure the execution of” the release. Id. at 1377. In an
effort to circumvent the release, Prall argued, inter alia,
that INB had fraudulently induced him to enter into the
release agreement by making certain misrepresenta-
tions prior to the agreement’s execution. Id. at 1378.
  The Indiana Court of Appeals recognized first the
general principle that an integration clause “is to be
considered as any other contract provision to deter-
10                                    Nos. 12-1035 & 12-1036

mine the intention of the parties” and the weight to be
given to it “will vary, depending on the facts and cir-
cumstances of each particular case.” Id. at 1377. The
court then went on to reject Prall’s argument, noting
that Prall was a sophisticated party who was represented
by counsel when the release agreement was signed. Id.
at 1378. The court also found it persuasive that Prall
“expressly stated that he was not relying upon the repre-
sentation of INB in entering into the release.” Id.2 Addi-
tionally, the court noted that, even if he “had not unequiv-
ocally affirmed in the release he was not relying on
any representations from INB, he has failed to estab-
lish reliance.” Id. at 1379. The court continued—in the
passage that would later form the basis of the Circle
Centre decision—“A releasor, in order to avoid a re-
lease on the ground of fraud or misrepresentation, must

2
  As this Court has recognized, such “no-reliance” or “dis-
claimer of reliance” clauses “ ‘serve a legitimate purpose in
closing a loophole in contract law’ by heading off a suit for
fraud used as a device for trying to get around the limitations
that the parol evidence rule and contract integration clauses
place on efforts to vary a written contract on the basis of oral
statements made in the negotiation phase.” Nightingale Home
Healthcare, Inc. v. Anondyne Therapy, LLC, 589 F.3d 881, 885
(7th Cir. 2009) (quoting Extra Equipamentos E Exportacao Ltda.
v. Case Corp., 541 F.3d 719, 724 (7th Cir. 2008)). “ ‘[N]o
reliance clauses are called ‘big boy’ clauses (as in ‘we’re big
boys and can look after ourselves’),’ and hence in some states
are not enforced without an inquiry into the circumstances
of its negotiation, to make sure that the signatory knew what
he was doing.” Id.
Nos. 12-1035 & 12-1036                                    11

show he had a right to rely on the misrepresentation,
and he did in fact rely on it in executing the release. . . .
In other words, the fraud must have induced or pro-
duced the execution of the release or contributed to it as
a cause.” Id. (citing 76 C.J.S. § 27).
  It is clear from the context of this passage in Prall and
the court’s citation to the Corpus Juris Secundum that
the Indiana Court of Appeals was using the word “re-
lease” to denote the release agreement between Prall
and INB generally, rather than the specific integration
provision contained in the agreement. With this in
mind, we turn to Circle Centre.
   In Circle Centre, a landlord sued a tenant for unpaid
rent, and the tenant brought a counterclaim for fraudu-
lent inducement to enter into the lease. The landlord
filed a motion for judgment on the pleadings as to the
tenant’s counterclaim based upon the inclusion of an
integration clause and a no-reliance provision in the
lease. The tenant acknowledged in the provision that it
had “independently investigated” the project and had
“not relied upon any inducements or representations
on the part of the Landord or Landlord’s representatives,
other than those contained in the Lease.” 762 N.E.2d at
177. The trial court denied the landlord’s motion, and
the Court of Appeals reversed, holding that the no-
reliance language in the lease precluded the tenant
from using the alleged prior misrepresentations to
form the basis of its fraud claim. Id. at 178-79.
  In reaching its holding, the appellate court observed
that Indiana courts had addressed whether an express
12                                  Nos. 12-1035 & 12-1036

integration clause barred a fraudulent inducement claim
“sparingly and with varying results.” Id. at 179. The court
noted that, in Jenkins v. Nebo Props., Inc., 439 N.E.2d
686, 694 (Ind. Ct. App. 1982), it had permitted parol
evidence of fraud even in the face of an express integra-
tion clause, while it had not done so in Prall. Id. The
Circle Centre court then analogized the case before it to
Prall and precluded the use of parol evidence. “[J]ust
as Prall represented, in effect, that he had investigated
the information, [the tenant] expressly stated that it
had performed its own independent investigation.” Id.
  In the course of its decision, the Circle Centre court
cited the passage in Prall discussed above and decreed
that the tenant, in order to overcome the integration
and disclaimer provision, “would have to show both
that it had a right to rely on [the landlord’s] alleged
misrepresentations and that it did in fact rely on them
in executing that portion of the lease which disclaims such
reliance.” Id. at 180 (citing Prall, 627 N.E.2d at 1379) (em-
phasis added). “In other words,” the court continued,
“the fraud must have induced or produced the execution
of the lease disclaimer or contributed to it as a cause.”
Id. (citing Prall, 627 N.E.2d at 1379) (emphasis added).
  It is unclear whether the Circle Centre court intended
these statements to be an application of the more
general rule espoused in Prall to the particular facts
before it, including the presence of an explicit no-reliance
clause, or whether the court intended to announce a
new categorical rule requiring a party asserting fraudu-
lent inducement to establish fraud in the inducement of
Nos. 12-1035 & 12-1036                                 13

the integration clause itself regardless of the factual
circumstances. What is clear is that Prall did not limit
the fraudulent inducement inquiry only to that portion
of the agreement that disclaimed reliance, but exa-
mined the agreement as a whole. Decisions by the
Indiana Court of Appeals subsequent to Circle Centre
have adopted this broader reading of Prall.
  The Indiana appellate court addressed this issue again
in America’s Directories Inc. v. Stellhorn One Hour Photo,
Inc. In that case, the plaintiff claimed that it had been
fraudulently induced into signing a three-year contract
with the defendant. The form contract stated, in relevant
part, that “NO VERBAL AGREEMENTS OR REPRESEN-
TATIONS OUTSIDE OF THIS AGREEMENT HAVE
BEEN MADE TO OR RELIED UPON BY PURCHASER.”
Am.’s Directories, 833 N.E.2d at 1066. At trial, the de-
fendant proposed a jury instruction that provided, “[A]s
a matter of law, any oral representations made by [defen-
dant] to [plaintiff] cannot be fraud in the inducement
because the . . . provision disclaiming reliance on
such representations supercedes any prior oral repre-
sentations.” Id. at 1067. The trial court refused to adopt
the proposed jury instruction. Id.
  The Court of Appeals, again echoing Franklin, noted
that “the determination of whether the parties intended
a writing to be totally integrated must be based on all
the relevant evidence,” and “[t]he weight to be given an
integration clause will vary depending on the facts and
circumstances of each particular case.” Id. at 1067. The
court went on to affirm the trial court’s refusal to give
14                                  Nos. 12-1035 & 12-1036

the instruction, finding that the requested instruction
“is thus an incorrect statement of law.” Id. “Not only
does the instruction ignore Indiana case law, which
holds that the conclusiveness to be given an integration
clause varies depending on the facts and circumstances
of each case . . . it also disregards the exception to
the parol evidence rule, which explicitly permits the
introduction of prior statements to prove fraud in the in-
ducement.” Id. (citing Circle Centre, 762 N.E.2d at 179).
In reaching its decision, the Indiana Court of Appeals in
America’s Directories cited Circle Centre for the general
proposition that a plaintiff can rely upon parol evidence
to establish fraudulent inducement as to the entire agree-
ment, rather than limiting proof of fraudulent induce-
ment to the integration clause itself.
  Tru-Cal, Inc. v. Conrad Kacsik Instrument Systems, Inc.,
905 N.E.2d 40 (Ind. Ct. App. 2009), also discussed Prall
and Circle Centre, but under a slightly different set of
facts. In Tru-Cal, the plaintiff claimed it had been fraudu-
lently induced into entering into a settlement agree-
ment based on a forged underlying document. In re-
sponse, the defendant claimed that the plaintiff could
not reasonably rely upon the forged document to
support a fraud claim because the integration clause
in the settlement agreement disclaimed reliance on any
outside representations. Id. at 45. The appellate court
explained that, in Prall and Circle Centre, it had “acknowl-
edged that a party could overcome the effect of an in-
tegration clause if it could show it had a right to rely
on the alleged misrepresentations and did in fact rely
on them in executing the release and/or integration
Nos. 12-1035 & 12-1036                                     15

clause.” Id. The court then applied a broad reading of
Prall and Circle Centre to conclude, “Here, there can be
no doubt that the fraud directly induced the execution
of the settlement agreement or, at least, contributed to
its cause.” Id. at 46 (emphasis added).
  The Tru-Cal court also was careful to recognize that
the agreement did not contain a no-reliance or disclaimer
provision, unlike in Prall and Circle Centre. Id. Accordingly,
the Tru-Cal court found that this was “the type of case
described in Prall and Circle Ctr. Dev. Co. where a party
can overcome the effect of an integration clause and
bring a fraud in the inducement claim to rescind
the contract.” Id.
  Most recently, the Indiana Court of Appeals decided
Wind Wire LLC v. Finney, 977 N.E.2d 401 (Ind. Ct. App.
2012). There, the purchasers of a wind turbine claimed
that they were fraudulently induced into signing a sales
contract by the seller. The sales contract contained an
integration clause stating that “[i]t is understood that
this Agreement and any documents which are attached
hereto or referenced herein constitute the intire [sic]
agreement between the parties and all other agreements,
represenstion [sic], promises, inducements, statements,
and understandings, prior to and contemporaneous
with this Agreement, written or oral, are suspended by
this Agreement.” Id. at 403-04. The seller, relying on
Circle Centre, argued that “the fraudulent induce-
ment exception to the parol evidence rule only ap-
plies if the alleged misrepresentation specifically
‘induced or produced the execution of the . . . disclaimer,’
16                                 Nos. 12-1035 & 12-1036

as opposed to the signing of the contract generally.”
Id. at 405.
  The appellate court disagreed. While noting that Wind
Wire had “accurately quot[ed]” Circle Centre, the court
explained that “the proposition upon which it relies
has a broader application.” Id. The court emphasized
the language in Prall, as pointed out by the court in Tru-
Cal, which allowed parties to argue that they were fraud-
ulently induced in “ ‘executing the release and/or inte-
gration clause.’ ” Id. (quoting Tru-Cal, 905 N.E.2d at
45). Moreover, the appellate court observed that
Circle Centre “did not overrule the requirement that
the weight given to a contract’s integration clause be
decided on a case-by-case basis.” Id.

 D. Returning to Franklin and First Principles
  As the Indiana Supreme Court has explained, the
proper weight to be given to an integration clause is to
be determined on a case-by-case basis. Franklin, 493
N.E.2d at 166. As we have seen, among the many
factors that a court may consider is the existence of no-
reliance or disclaimer language, as well as the relative
sophistication of the parties and the circumstances sur-
rounding the agreement’s execution. The imposition of
an inflexible rule that would require a party claiming
fraudulent inducement to demonstrate that he or she
was fraudulently induced to agree to the integration
clause itself would unreasonably restrict the trial court’s
ability to conduct the factual analysis that the Indiana
Nos. 12-1035 & 12-1036                                  17

Supreme Court requires. Accordingly, to the extent that
the holding in Circle Centre was intended to establish
such a rule, we are persuaded that the Indiana courts
would return to the principles espoused in Prall and
Franklin as it has in Tru-Cal and Wind Wire.
  Returning to the case at hand, the Covenant states
that “[t]he parties agree this agreement represents the
parties’ sole agreement.” Although the district court
recognized that “[t]his language does not specifically
state that this section of the agreement is intended to
be an integration clause,” the court concluded that the
provision constituted an express integration clause be-
cause “it serves no other purpose except to act as an
integration clause.” We have no reason to disagree with
this conclusion. Like the district court, we cannot dis-
cern any other purpose for this language than to serve
as an integration clause.
  As for Atkinson’s efforts to overcome the integration
clause and rely upon parol evidence to establish fraud-
ulent inducement, the district court, citing Circle Centre,
concluded that “[a]bsent a showing by Atkinson that
there was fraud in the inducement of the clause itself,
the integration clause will prohibit the court from
doing anything other than enforcing the [C]ovenant as
written.” In so doing, the district court relied upon an
impermissibly narrow reading of the Circle Centre
decision without conducting an independent assess-
ment as to whether the parties actually intended the
integration clause to impose such a restriction. As in
Prall and Circle Centre, the district court on remand may
18                                 Nos. 12-1035 & 12-1036

certainly conclude, after reviewing the evidence, that
the parties intended the integration clause to permit the
parties to overcome the parol evidence rule only if they
can demonstrate fraudulent inducement as to the in-
tegration clause itself, rather than the agreement as
a whole. The existence (or absence) of a no-reliance
clause, among other factors, would be relevant
to such an inquiry. But invoking a categorical rule,
as the district court did here, without conducting such a
case-by-case analysis, is inconsistent with the Indiana
Supreme Court’s pronouncements in Franklin and the
decisions of the Indiana Court of Appeals in Prall and
its progeny.

                    III. Conclusion
  Because, in the absence of a factual inquiry, the mere
presence of an integration clause does not preclude
Atkinson from introducing parol evidence that it was
fraudulently induced to enter into the Covenant agree-
ment as a whole, the district court’s opinion and order
is R EVERSED and R EMANDED for further proceedings
consistent with this opinion.

                         6-11-13