The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF PENNSYLVANIA
DE LAGE LANDEN FINANCIAL :
SERVICES, INC., :
:
Plaintiff, :
:
v. : CIVIL ACTION
:
SOUTHERN ILLINOIS INTERNAL :
MEDICINE, LTD; AND MAZHAR H. : NO. 25-1619
LAKHO, :
:
Defendants, :
:
v. :
:
INVASIX, INC., :
:
Third-Party Defendant. :
Perez, J. May 29, 2026
MEMORANDUM
This dispute arises from the sale of a cosmetic medical device sold by Invasix, Inc.
(“Invasix”) to Southern Illinois Internal Medicine, Ltd. (“SIIM”). The sale was financed by De
Lage Landen Financial Services, Inc. (“DLL”) and involved several contracts entered into between
the parties. Shortly after executing the contract, SIIM had a change of heart and sought to reject
and/or return the device and made no payments it owed to DLL under the finance lease. DLL sued
SIIM for breach of contract and SIIM’s sole owner Dr. Mazhar H. Lakho for breach of personal
guaranty. SIIM and Dr. Lakho contend, however, that the contracts were the result of fraud on the
part of Invasix employee Clay Ditslear, so they brought third-party fraud-based claims against
Invasix.
Before the Court are the parties’ cross-motions for summary judgment. DLL affirmatively
moves for summary judgment on its breach of contract and breach of personal guaranty claims,
and Dr. Lakho moves for summary judgment on DLL’s breach of personal guaranty and unjust
enrichment claims. However, neither party has shown they are entitled to judgment as a matter of
law, and material factual disputes remain. Their motions must be denied. Invasix moves for
summary judgment on Defendants’ fraud-based claims. The alleged misrepresentations or
omissions upon which Defendants relied could have easily been discovered had Dr. Lakho read
the writings he signed. “[A] party may not enter into a transaction with its eyes closed to available
information and then charge that it has been deceived by another.” Cozzi Iron & Metal, Inc. v. U.S.
Office Equip., Inc., 250 F.3d 570, 574 (7th Cir. 2001) (cleaned up). For that reason and the reasons
discussed more fully below, Invasix’s motion is granted.
I. Factual Background1
Plaintiff DLL is a finance company that provides vendor financing for products and
services offered by a vendor when the vendor’s customer requires financing. DLL Statement of
Facts, ECF No. 36 ¶ 1. Third-Party Defendant Invasix is a corporation that sells aesthetic
technology, such as skin tightening treatments, laser hair removal, and resurfacing equipment,
including a device known as Morpheus8. Invasix Statement of Facts, ECF No. 40 ¶¶ 22, 23.
Defendant Dr. Mazhar H. Lakho is the sole shareholder and President of the internal medicine
practice SIIM. Id. ¶¶ 2, 11.
Invasix employed Clayton Ditslear as a Territory Manager. Id. ¶ 27. Ditslear went to SIIM’s
office several times to meet with Dr. Lakho to sell SIIM the Morpheus8. Id. ¶ 29. Ditslear collected
1 The facts in this section are undisputed unless otherwise noted. The facts are taken from the Statements of Undisputed
Facts submitted by DLL, Dr. Lakho, and Invasix, as well as the corresponding exhibits. See ECF Nos. 36 (DLL’s
SOF), 37 (Lakho SOF), and 40 (Invasix SOF), 41 (Exhibits).
Dr. Lakho’s and SIIM’s information and submitted a credit application to Financial Partners Group
(“FFP”) to determine credit worthiness and to identify potential lenders to facilitate SIIM’s
purchase of the Morpheus8. Id. ¶ 33. As part of the credit application, Dr. Lakho provided Ditslear
with his Social Security number (“SSN”). Id. ¶ 34. FFP identified DLL as a lender. Id. 40 ¶ 50.
On December 18, 2023, Ditslear met with Dr. Lakho at SIIM’s office to close on the
transaction for the Morpheus8. Id. ¶ 38. That day, Dr. Lakho executed the Customer Purchase
Agreement (“CPA”), which is the agreement of sale between SIIM and Invasix. Id. ¶ 39; see also
CPA, Ex. G, ECF No. 41-7. Dr. Lakho contends he executed the agreement based upon Ditslear’s
representation that SIIM would be able to return the Morpheus8. Id. The CPA contains no return
clause. ECF No. 41-7.
The CPA lists the price of the Morpheus8 as $121,000. Id. The CPA contains the following
relevant language:
ACCEPTANCE OF AGREEMENT By signing below, Customer is representing to
Invasix, Inc. (“Company”), which operates through the trade name InMode, that it
1) has read understands, and accepts the terms of this Customer Purchase
Agreement, the Terms and Conditions Addendum, which is available at
www.Inmodemd.com/terms-US/ and incorporated herein by reference . . . .
Customer further acknowledges that this is the complete Agreement between the
parties, is subject to the payment terms and conditions contained or referred to
herein, and expressly disclaims any additional and/or different terms and conditions
stated on any purchase orders, sales quotes or other written or oral proposals shared
or discussed between the parties.
Id. Dr. Lakho did not review the Terms and Conditions Addendum (“T&C”) on InMode’s website
before signing the Customer Purchase Agreement. ECF No. 40 ¶ 47. When asked about the clause
referring to the T&C, Dr. Lakho testified that he did not pay attention to it and that he signed
because he “trusted” Ditslear. ECF No. 41-1 at 24. Invasix and DLL agree that the T&C on
InMode’s website states in bold that “All sales and purchases under the [CPA] are final and non-
refundable. Company grants no right of return to Customer for any purchased System or other
items.” Id. ¶ 46; SIIM Dep. Tr. at 87–88, Ex. A, ECF No. 41-1 at 24. SIIM and Dr. Lakho contend
they do not have the T&C, so they are unable to confirm the accuracy of that statement. ECF No.
40 ¶ 46 and SIIM/Lakho’s Response. The T&C was not attached as an exhibit.
In addition to the CPA, Dr. Lakho signed a Lease Contract (“Lease”), which had
handwritten sections pre-populated by Ditslear, including Dr. Lakho’s SSN. Id. ¶ 52; see also
Lease, Ex. H, ECF No. 41-8; Ditslear Dep. Tr. at 87, Ex. E, ECF No. 41-5 at 24. Dr. Lakho testified
that he could not recall whether the SSN was written on the lease before he signed. See ECF No.
40 ¶ 52 and responses; Lakho Dep. Tr. at 103, Ex. A, ECF No. 41-1 at 28.
The Lease lists SIIM as the Lessee, Dr. Lakho as the Owner/Principal of SIIM, and DLL
as the Lessor. ECF No. 41-8. The Lease includes specific payment terms and a personal guaranty
provision. ECF No. 40 ¶¶ 54, 55; ECF No. 41-8. The personal guaranty specifically states:
I, the guarantor identified by the Social Security Number above, unconditionally
guaranty prompt payment of all the Lessee’s obligations. Lessor is not required to
proceed against Lessee or Equipment or enforce other remedies before proceeding
against me. I waive notice of acceptance and all other notices or demands of any
kind to which I may be entitled. I consent to any extensions or modification granted
to Lessee and the release and/or compromise of any obligations of Lessee or any
other guarantors without releasing me from my obligations. This is a continuing
guaranty and will remain in effect in the event of my death and may be enforced by
or for the benefit of any assignee or successor of Lessor. This guaranty is governed
by and construed in accordance with the Laws of the Commonwealth of
Pennsylvania and I consent to non-exclusive jurisdiction in any state or federal
court in Pennsylvania and waive trial by jury. I ACKNOWLEDGE AND AGREE
THAT IF I ENTER MY SOCIAL SECURITY NUMBER ABOVE, THEN MY
SIGNATURE, IN ADDITION TO BINDING THE LESSEE THROUGH MY
CORPORATE CAPACITY, SHALL ALSO BIND ME PERSONALLY AS A
GUARANTOR, CONFIRMING MY ACCEPTANCE OF THE OBLIGATIONS
CONTAINED IN THIS SECTION AND CONSENTING TO LESSOR
OBTAINING MY CONSUMER CREDIT REPORT IN CONNECTION WITH
THIS LEASE.
ECF No. 41-8.
A Purchase Order dated December 19, 2023, states that the Morpheus8 was sold for
$121,000 by vendor InMode to DLL and was shipped to SIIM, the Lessee. Purchase Order, Ex. S,
ECF No. 41-19.
At some point after executing the CPA and Lease, SIIM determined it did not want the
Morpheus8. ECF No. 40 ¶ 80. On an unknown date between December 18, 2023, and January 2,
2024, the Morpheus8 was delivered to SIIM. ECF No. 40 ¶ 76. Dr. Lakho was out of the office
that day. Id. SIIM contends it immediately rejected the equipment. Id. ¶ 76 and SIIM/Lakho’s
Response. Invasix contends the equipment was signed for by a SIIM employee, but there is no
evidence in the record establishing that assertion. See id. ¶ 78 (citing ECF No. 41-1 at 32 (Lakho
testifying that he did not know who was in the office on the day the Morpheus8 was delivered, but
he thinks the manager Tammy was present and “[s]he may have been” the person who signed for
it)). Defendants contend the issue of rejection remains in dispute. Id. ¶ 78 and SIIM/Lakho’s
Response.
On the morning of January 2, 2024, Ditslear went to SIIM’s office to unbox the Morpheus8
and make sure everything was “firing properly.” Id. ¶ 77. Dr. Lakho was not present at that time.
Id. ¶ 77 and SIIM/Lakho’s Response. It is not clear exactly what time Ditslear arrived, other than
that he testified it was “first thing in the morning.” See ECF No. 41-5 at 28. At 9:59 a.m. on January
2, 2024, Dr. Lakho texted Ditslear asking him not to unbox the Morpheus8 and stating, “[w]e may
not be able to buy the machine in anyway.” Ex. K, ECF No. 41-11 at 6. Ditslear did not see the
text message until after he unboxed the machine. ECF No. 41-5 at 28. At 11:36 a.m., Ditslear
responded saying, “the Morpheus is unboxed in your office.” Id. Ditslear testified that if he had
seen Dr. Lakho’s text message before unboxing the Morpheus8, he would not have unboxed it.
ECF No. 41-5 at 28. SIIM requested to return the Morpheus8 device to Invasix after it was
delivered. ECF No. 37 ¶ 13. Neither DLL nor Invasix has picked up the device. Id. ¶ 14. Ditslear
eventually stopped responding to Dr. Lakho’s requests to return it. See ECF No. 41-5 at 32. Dr.
Lakho and SIIM contend the Morpheus8 remains in the packaging and has never been plugged in,
turned on, or used. ECF No. 40 ¶¶ 90–93. SIIM has never made any payment to DLL pursuant to
the Lease. Id. ¶ 83.
II. Procedural History
On February 20, 2025, DLL sued Defendants SIIM and Dr. Lakho in the Court of Common
Pleas of Chester County Pennsylvania, for breach of the Lease, breach of personal guaranty, and
unjust enrichment. ECF No. 1-1. On March 27, 2024, Defendants removed the case to this Court,
asserting diversity jurisdiction. ECF No. 1. On April 3, 2025, Defendants answered the Complaint,
asserting a number of affirmative defenses. ECF No. 9.
On June 24, 2025, Defendants filed a Third-Party Complaint against InMode, Ltd.
(“InMode”) and Invasix Inc. (“Invasix” or “Third-Party Defendant”), raising three claims:
Violation of the Illinois Consumer Fraud and Deceptive Business Practices Act (“Consumer Fraud
Act” or “ICFA”), fraudulent inducement, and fraudulent misrepresentation. ECF No. 13. On July
30, 2025, Defendants voluntarily dismissed their claims against InMode without prejudice. ECF
No. 17. Invasix answered the Third-Party Complaint on August 8, 2025, raising eighteen
affirmative defenses. ECF No. 19.
On October 27, 2025, DLL and Invasix filed motions for a non-jury trial. ECF Nos. 25 &
26. Defendants opposed only with respect to their claims against Invasix. ECF No. On November
20, 2025, the Court granted in part the motions, holding DLL’s claims against Defendants must be
heard in a bench trial, and Defendants’ claims against Invasix must be heard by a jury. ECF No.
30.
On April 7, 2026, each party moved for summary judgment. ECF Nos. 35 (De Lage MSJ),
38 (Lakho MSJ), 39 (Invasix MSJ). Oppositions and replies have been filed, and the motions are
ripe for review.
III. Summary Judgment Standard
Summary judgment is properly granted when “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). Facts
are material if they “might affect the outcome of the suit under the governing law.” Physicians
Healthsource, Inc. v. Cephalon, Inc., 954 F.3d 615, 618 (3d Cir. 2020). A dispute as to those facts
“is genuine if the ‘evidence is such that a reasonable jury could return a verdict for the nonmoving
party.’” Id. (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). A party asserting
a fact is genuinely disputed must support its contention by citing to particular materials in the
record. Fed. R. Civ. P. 56(c).
A party pursuing claims of fraud must prove them by clear and convincing evidence, and
at summary judgment, the Court must evaluate the evidence “through the prism of the substantive
evidentiary burden.” Richelieu Foods, Inc. v. New Horizon Warehouse Distrib. Ctr., 67 F. Supp. 3d
903, 915 (N.D. Ill. 2014) (quoting Anderson, 477 U.S. at 254; and citing JP Morgan Chase Bank,
N.A. v. Asia Pulp & Paper Co., 707 F.3d 853, 864 (7th Cir. 2013)).
IV. DLL Is Not Entitled to Summary Judgment on its Breach of Contract Claim
Against SIIM.
A. The Lease is a Finance Lease Governed by 13 Pa. C.S.A. § 2A103 (Article
2A of the UCC).
As an initial matter, the parties dispute whether the Lease is a finance lease under Article
2A of the UCC or a loan. See ECF No. 45 at 9–10. If it is a finance lease, the parties agree that
SIIM’s obligation to pay became irrevocable and independent upon acceptance of the Morpheus8.
13 Pa. C.S.A. § 2A407; see also ECF No. 45 at 10. The Court finds that the Lease is a finance
lease under Article 2A.
“A finance lease is the product of a three party transaction,” in which a “supplier
manufactures or supplies the goods pursuant to the lessee’s specification,” and the lessor and lessee
“enter into a lease or sublease of the goods.” 13 Pa. C.S.A. § 2A103, cmt (g). “Due to the limited
function usually performed by the lessor, the lessee looks almost entirely to the supplier for
representations, covenants and warranties.” Id. “Even ‘if a transaction does not qualify as a finance
lease, the parties may achieve the same result by agreement.’” De Lage Landen Fin. Servs., Inc. v.
Rasa Floors, LP, 792 F. Supp. 2d 812, 828 (E.D. Pa. 2011) (brackets omitted) (quoting 13 Pa.
C.S.A. § 2A103, cmt. (g)); see also De Lage Landen Fin. Servs., Inc. v. M.B. Mgmt. Co., Inc., 888
A.2d 895, 900–01 (Pa. Super. Ct. 2005) (finding the parties bound by the language contained in
the contract explicitly agreeing that the lease was a finance lease as defined in article 2A). When
parties form a finance lease under Article 2A, the lessee’s obligations “become irrevocable and
independent upon the lessee’s acceptance of the goods.” 13 Pa. C.S.A. § 2A407. This is known as
a “hell or high water” clause. Id., cmt. 1; see also Rasa Floors, 792 F. Supp. 2d at 828.
Here, Section 10 of the Lease states that it is a “Finance Lease” under Article 2A and that
SIIM “irrevocably waive[s] any and all rights and remedies . . . under UCC sections 2A-508
through 2A-522.” ECF No. 41-8. Section 1 mirrors Article 2A’s “hell or high water” clause, stating:
“You agree that this [sic] your obligations under this Lease are absolute, unconditional, and not
subject to cancellation, reduction, setoff or counterclaim.” Id. Section 4 directs the lessee to make
any claims relating to maintenance, service, and supplies against the service provider, not DLL,
and requires the lessee to continue paying DLL, whether or not requested services are provided.
Id. Taken together, the Lease’s terms clearly establish it is a finance lease, regardless of whether it
meets the statutory requirements. See M.B. Mgmt., 888 A.2d at 900–01.
Defendants attempt to muddy the waters by pointing to the testimony of DLL’s Rule
30(b)(6) designee Andrew Chesbro, wherein he characterized the transaction as a loan. See ECF
No. 45 at 9 (quoting Chesbro Dep., ECF No. 41-6 at 15). This testimony does not change the terms
of the Lease. A lay witness’s testimony as to his understanding of the parties’ agreement does not
create a dispute of material fact where the contract’s terms are unambiguous. “Contract
interpretation is a question of law that requires the court to ascertain and give effect to the intent
of the contracting parties as embodied in the written agreement. . . . When a writing is clear and
unequivocal, its meaning must be determined by its contents alone.” In re Old Summit Mfg., LLC,
523 F.3d 134, 137 (3d Cir. 2008) (quoting Dep’t of Transp. v. Pa. Indus. for the Blind &
Handicapped, 886 A.2d 706, 711 (Pa. Commw. Ct. 2005)). Here, the Lease is clear and
unequivocal that it is a finance lease governed by Article 2A of the UCC. The Court must determine
its meaning by the contents of the Lease alone. Chesbro’s characterization of the transaction does
not overcome the written terms of the Lease.
B. There is a Genuine Dispute as to Whether SIIM Accepted or Rejected the
Morpheus8.
Even though the Lease is a finance lease with a “hell or high water” clause, that provision
cannot take effect if the Morpheus8 was never accepted. DLL argues the delivery of the
Morpheus8, for which a SIIM staff member signed, constituted acceptance. ECF No. 35-1 at 12.
Defendants contend the Morpheus8 was not accepted, and that Dr. Lakho attempted to reject the
device by texting Ditslear not to unbox it and later seeking to return it. See ECF No. 45 at 14.2 The
2 Section 3 of the Lease provides: “You acknowledge that by signing below you have tested and accepted the
Equipment and that it is in good working order.” ECF No. 41-8. Defendants contend there is no “signature below,” so
the signing of the Lease itself cannot constitute acceptance. ECF No. 45 at 14. The Court does not resolve this issue
Court cannot resolve this factual dispute on the current record, so summary judgment is not
appropriate.
Under Article 2 of the UCC, “[a]cceptance of goods occurs when the buyer . . . fails to
make an effective rejection” after having “a reasonable opportunity to inspect them.” 13 Pa. C.S.A.
§ 2606(a). A rejection of goods “must be within a reasonable time after their delivery.” 13 Pa.
C.S.A. § 2602(a). There is no requirement that rejection occur before or at the time of delivery. Id.
Even a wrongful rejection may still be effective if it is timely. Integrated Circuits Unltd. v. E.F.
Johnson Co., 875 F.2d 1040, 1042 (2d Cir. 1989) (quoting 1 White & Summers, Uniform
Commercial Code 314 (2d ed. 1980)).3
DLL relies on the Lease’s “hell or high water” clause, which states the Lessee’s obligations
are “absolute, unconditional, and are not subject to cancellation, reduction, setoff or counterclaim.”
DLL SOF ¶ 18, ECF No. 36; see also ECF No. 45 at 5. However, that puts the cart before the
horse. The clause only takes effect upon acceptance of the goods. See 13 Pa. C.S.A. § 2A407 (“In
the case of a finance lease . . . , the lessee’s promises under the lease contract become irrevocable
and independent upon the lessee’s acceptance of the goods.” (emphasis added)).
DLL asserts that Dr. Lakho’s staff accepted delivery of the Morpheus8 and that Dr. Lakho
“took no steps whatsoever to prevent acceptance.” ECF No. 35-1. DLL cites no law supporting its
contention that acceptance occurred at the time of delivery. It is undisputed that Dr. Lakho was not
present when the device was delivered. Defendants contend they tried to reject the Morpheus8
after its delivery on multiple occasions and that SIIM never used, plugged in, or turned on the
at this stage because DLL does not address this argument, nor does it appear to rely on Section 3 to establish
acceptance. However, the Court acknowledges that DLL’s 30(b)(6) witness testified that DLL anticipated it would
seek a signature after the equipment had been received, tested, and accepted by SIIM. ECF No. 41-6 at 16–17.
3 Although DLL would be entitled to damages for breach due to a wrongful rejection, those damages would be limited
to actual damages, not the contract price. Id.
device. ECF No. 40 at 51–53. Absent more arguments related to acceptance and rejection,
supported by citations to legal authority and the record, the Court cannot determine the Morpheus8
was accepted. Summary judgment is therefore denied on DLL’s breach of contract claim against
SIIM.4
V. Neither DLL Nor Dr. Lakho Are Entitled to Summary Judgment on DLL’s
Breach of Personal Guaranty Claim against Dr. Lakho.
As discussed above, the Court cannot conclude the Morpheus8 was accepted, thereby
triggering SIIM’s unconditional obligations under the Lease. Dr. Lakho cannot be personally
bound to guarantee SIIM’s obligations if SIIM had no such obligations in the first place.
Accordingly, DLL’s motion for summary judgment on the breach of guaranty claim must be
denied.
Dr. Lakho has also not established he is entitled to judgment as a matter of law on the
breach of personal guaranty claim. Dr. Lakho’s arguments focus on two primary issues: first, he
argues that the personal guaranty clause contained a condition precedent requiring him to
personally enter his SSN on the Lease and raises a factual dispute as to whether Ditslear wrote the
SSN on the Lease before or after Dr. Lakho signed; second, Dr. Lakho argues there was no express,
unambiguous evidence that he intended to bind himself personally.
A. Ditslear Wrote Dr. Lakho’s SSN on the Lease Before Signing.
The Court first resolves Dr. Lakho’s attempt to create a factual dispute as to whether
Ditslear wrote his SSN on the Lease before or after signing. It is undisputed that Ditslear wrote the
SSN, not Dr. Lakho. It is further undisputed that Ditslear did so before presenting the Lease to Dr.
Lakho for signing.
4 DLL also argues that Defendants’ fraud claims against Invasix fail. The Court need not engage with DLL’s arguments
relating to fraud because it addresses Defendants’ fraud claims against Invasix in connection with Invasix’s motion.
Ditslear testified unequivocally that “everything was prepopulated besides [Dr. Lakho’s
signature and tax ID.]” ECF No. 41-5 at 24. He further confirmed that he handwrote the SSN
before he arrived at Dr. Lakho’s office. Id. Dr. Lakho did not create a genuine dispute in his
deposition testimony (or elsewhere). He testified only that he did not recall whether his SSN
appeared on the Lease when he signed. ECF No. 41-1 at 28. Dr. Lakho’s inability to recall whether
his SSN was written on the document before he signed it does not amount to a genuine dispute that
it was there. See Bradshaw v. N.J., No. 18-14089, 2026 WL 310110, at *14 (D.N.J. Feb. 5, 2026)
(plaintiff’s “inability to recall a discussion . . . does not genuinely dispute that such a discussion
occurred”).5
B. The Court Cannot Determine as a Matter of Law at this Stage that Dr.
Lakho Intended to be Bound by the Personal Guaranty.
Given there is no dispute of material fact as to whether the SSN appeared on the Lease
when Dr. Lakho signed it, the Court must decide whether the Lease required Dr. Lakho to
personally enter his SSN to trigger the personal guaranty and if so, whether Dr. Lakho ratified the
Lease by signing with his SSN pre-populated. The Court answers the first question affirmatively
but finds there is a factual dispute as to Dr. Lakho’s ratification.
“[G]uaranty contracts [are] subject to [the] same rules of interpretation as other
agreements.” Garden State Tanning, Inc. v. Mitchell Mfg. Group Inc., 273 F.3d 332, 335 (3d Cir.
2001) (citing Mtg. House Lane, Ltd. v. Melso, 682 A.2d 854, 857 (Pa. Super. Ct. 1993)). “The
fundamental rule in interpreting the meaning of a contract is to ascertain and give effect to the
intent of the parties.” Binswanger of Pa., Inc. v. TSG Real Estate LLC, 217 A.3d 256, 262 (Pa.
5 Dr. Lakho points to evidence in the record that Ditslear received Dr. Lakho’s email address four days after the Lease
was signed and the email address appears on the Lease. See ECF No. 41-1 at 28; ECF No. 41-5 at 31. He argues this
is evidence that the email address and SSN were added after signing. However, this speculation does not negate that
Ditslear testified he had collected the email address four days earlier on all of the documents and that the SSN was
pre-populated. ECF No. 41-5 at 24, 31.
2019). It is well settled that the parties’ intent must be determined by the writing itself, and when
the writing is clear and unambiguous, the court must determine the writing’s meaning only by its
terms. Id. Additionally, the court must “endeavor to find an interpretation which will effectuate the
reasonable result intended” before interpreting a provision “in such a way as to lead to an absurdity
or make the . . . contract ineffective to accomplish its purpose.” Id. (citation omitted). However,
where the contract is ambiguous, Pennsylvania courts construe the ambiguities against the drafter.
Franklin Interiors v. Wall of Fame Mgmt. Co., Inc., 511 A.2d 761, 763 (Pa. 1986). Nonetheless, a
signer’s “unilateral error” with respect to the contract’s interpretation or legal effect does not create
an ambiguity, nor does it “afford[] . . . more grounds for relief than does ignorance of the words.”
Denlinger, Inc. v. Dendler, 608 A.2d 1061, 1070 (Pa. Super. Ct. 1992) (quoting Schoble v. Schoble,
37 A.2d 604, 605 (Pa. 1944)).
Paragraph 11 of the Lease contains contradictory sentences: “Personal Guaranty: I, the
guarantor identified by the Social Security Number above, unconditionally guaranty prompt
payment of all the Lessee’s obligations. . . . I ACKNOWLEDGE AND AGREE THAT IF I ENTER
MY SOCIAL SECURITY NUMBER ABOVE, THEN MY SIGNATURE, . . . SHALL ALSO
BIND ME PERSONALLY AS A GUARANTOR . . . .” ECF No. 41-8. The first sentence indicates
the SSN is merely an identifier and does not require personal entry onto the form, while the final
all-caps sentence appears to require the signer to personally enter the SSN for the personal guaranty
to take effect. Each party relies on the portion of the clause that is favorable to it, and neither party
attempts to reconcile the two.
Dr. Lakho characterizes the final sentence as containing a condition precedent to the
enforceability of the personal guaranty. Pennsylvania law disfavors conditions precedent and will
only construe clauses as such where that “clearly appears to have been the parties’ intention.” Acme
Markets, Inc. v. Fed. Armored Exp., Inc., 648 A.2d 1218, 1220 (Pa. Super. Ct. 1994). However,
offers must be accepted “in the mode and manner expressly provided by the terms of the offer.”
Franklin Interiors, 511 A.2d at 762. “[T]he offeror is the master of his offer,” Restatement
(Second) Contracts § 58 cmt. a, and “a written instrument must be strictly construed against its
maker.” InfoComp, Inc. v. Electra Prods., Inc., 109 F.3d 902, 906 (3d Cir. 1997) (quoting Cucci v.
Rollins Protective Servs. Co., 546 A.2d 1131, 1135 (Pa. Super. Ct. 1988)). The drafter’s failure to
follow its own conditions of acceptance precludes it from relying on the clause for which the
conditions were not met. Id.
In Franklin Interiors, the formation of a valid contract was expressly conditioned upon the
written approval by an officer of Franklin Interiors. 511 A.2d at 763. The fact that no officer entered
a signature on the document was a facial defect that precluded formation. Id. Pennsylvania courts
have consistently applied this principle to agreements requiring specific signatures or approval.
See InfoComp, Inc., 109 F.3d at 905–06. Although, here there is a question of entry of an SSN and
not a signature, the Court finds that the Lease’s contradictory, ambiguous clause must be construed
against the drafter, DLL. Accordingly, absent ratification, Dr. Lakho cannot be bound by a personal
guaranty when DLL failed to follow its own conditions of acceptance.
There is, however, a dispute as to whether Dr. Lakho’s signature constituted ratification of
the agreement. DLL argues that even if the personal guaranty clause required Dr. Lakho to
personally enter his SSN, he ratified it by signing the Lease with the pre-written SSN. Dr. Lakho
does not directly respond to this argument, but DLL has not established it is entitled to judgment
as a matter of law on this issue. See Fed. R. Civ. P. 56(e)(3). “An agreement can be ratified by a
party through his actions when he shows an acceptance or adoption of the agreement with an intent
to ratify and knowledge of the material consequences.” Bayview Loan Serv., LLC v. Etreih, No.
130801821, 2016 WL 723071, at *3 (Phila. Ct. Com. Pl. Jan. 20, 2016), aff’d 2016 WL 6441300
(Pa. Super. Ct. Nov. 1, 2026). The Court agrees with Defendants that Dr. Lakho’s signature could
constitute ratification; however, the argument has not been fully briefed. Summary judgment is,
therefore, denied.
VI. Dr. Lakho Is Not Entitled to Summary Judgment on DLL’s Unjust Enrichment
Claim.
Under Pennsylvania law, a plaintiff raising an unjust enrichment claim must prove: (1) a
benefit conferred on defendant by plaintiff; (2) defendant’s appreciation of the benefit; and (3)
“acceptance and retention of such benefits under such circumstances that it would be inequitable
for defendant to retain the benefit without payment of value.” Schenck v. K.E. David, Ltd., 666
A.2d 327, 328 (Pa. Super. Ct. 1995).
A. Dr. Lakho May Be Held Personally Liable under the Participation
Theory
Dr. Lakho’s argument that he cannot be personally liable for unjust enrichment as a
corporate officer fails because he personally participated in the alleged misfeasance. Generally, an
officer of a corporation cannot be liable for a tort committed by the corporation unless he
personally takes part in the tort. Wicks v. Milzoco Builders, Inc., 470 A.2d 86, 90 (Pa. 1983). This
is called “the participation theory.” Id.; see also Animalscan, LLC v. Live Oak Veterinary
Specialists, LLC, No. 18-2288, 2019 WL 3801559, at *5 (M.D. Pa. Aug. 13, 2019). “Participation
theory, in simple terms, is a theory which imposes personal liability on corporate officers or
shareholders where they have personally taken part in the actions of the corporation.” First
Realvest, Inc. v. Avery Builders, Inc., 600 A.2d 601, 603 (Pa. Super. Ct. 1991) (citing Wicks, 570
A.2d at 89–90). The participation theory is only applicable where the claims involve misfeasance
by the actor (“the improper performance of an act”); nonfeasance (“the omission of an act which
a person ought not to do”) is not enough. Animalscan, 2019 WL 3801559 at *5 (quoting Aetna,
Inc. v. Health Diagnostic Lab’y, Inc., No. 15-1868, 2015 WL 9460072, at *9 (E.D. Pa. Dec. 28,
2015).
Aetna compared two Pennsylvania cases applying the participation theory. First, Aetna
explained that a corporate officer who personally supervises the refinancing of a mortgage can be
held liable for the mortgagors’ loss suffered as a result of the officer’s negligence. 2015 WL
9460072 at *9 (discussing Loeffler v. McShane, 539 A.2d 876 (Pa. Super. Ct. 1988)). By contrast,
a corporate president cannot be held liable for wrongful death as a result of a negligently
maintained helicopter where the president did not personally complete the maintenance. Id.
(discussing Shay v. Flight C Helicopter Servs., 822 A.2d 1 (Pa. Super. Ct. 2003)). The president’s
nonfeasance—failing to supervise the maintenance—was insufficient to invoke the participation
theory. Id. Applying these principles at the pleading stage, Aetna found that allegations of
personally planning, authorizing, and directing a fraud, including submitting bills with false and
fraudulent charges and personally profiting from the fraud due to part ownership in the company,
were sufficient to invoke the participation theory. Id.
Here, it is clear that Dr. Lakho was the only individual involved in entering the transaction
between SIIM and DLL. Dr. Lakho is the sole owner of SIIM and was the sole decisionmaker
throughout this process. The participation theory would apply, assuming all other elements of the
unjust enrichment claim are met. Dr. Lakho is not entitled to summary judgment on those grounds.
B. It Is Disputed Whether Defendants Voluntarily Retained the Morpheus8
and Whether Such Retention Is Unjust.
Dr. Lakho also argues DLL’s unjust enrichment claim fails because SIIM and Dr. Lakho
never used the Morpheus8 and, therefore, they received no benefit. ECF No. 38-1 at 5. The Court
is not convinced that Defendants’ decision not to unwrap or use the Morpheus8 means that no
benefit was received. However, the dispute as to the acceptance and rejection of the Morpheus8
bears on DLL’s unjust enrichment claim, making summary judgment again inappropriate.
The Restatement (Third) of Restitution and Unjust Enrichment, § 1 cmt. d, explains that
the benefit that supports a claim for restitution may take any form: e.g., services, property, saved
expenditures. The Restatement further explains that a defendant can be liable in restitution for
benefits it attempted to refuse but nonetheless received. Id. cmt. e (describing elements of unjust
enrichment claims as unhelpful, in particular “the defendant’s ‘appreciation or knowledge of the
benefit,’ is both mysterious and potentially mischievous. If the requirement is taken to mean that
a defendant cannot be liable in restitution for benefits of which the defendant was unaware—or
for benefits that the defendant attempted to refuse—it is plainly incorrect.”)). This is consistent
with Pennsylvania law, which focuses most significantly on whether the retention of the benefit is
unjust and which allows for recovery where the benefit was “either wrongfully secured or
passively received.” EBC, Inc. v. Clark Bldg. Sys., 618 F.3d 253, 273 (3d Cir. 2010) (cleaned up);
see also Water Polo I, L.P. v. W. Hanover Twp. Sewer Auth., 301 A.3d 1009, 1019 (Pa. 2023).
Here, the questions of whether Defendants “wrongfully secured or passively received” the
Morpheus8—or whether their efforts at rejection negate that they passively received the device—
and whether that is unjust should be decided by a fact finder. Summary judgment is, therefore,
denied.
VII. Invasix Is Entitled to Summary Judgment.
Defendants raised three causes of action against Invasix: Violation of the Consumer Fraud
Act (“ICFA”) (First Count), Fraudulent Inducement (Second Count), and Fraudulent
Misrepresentation (Third Count). ECF No. 13.6 Invasix moves for summary judgment on all
claims. The Court grants Invasix’s motion because the misrepresentations and omissions
Defendants identify cannot support their fraud claims under Illinois law.
Illinois common law fraud claims require a showing of: “(i) a false representation of
material fact, (ii) made with knowledge or belief of that representation’s falsity, (iii) made with the
purpose of inducing another party to act or to refrain from acting, and (iv) the other party
reasonably relies upon the representation to its detriment.” Colagrossi v. Royal Bank of Scotland,
57 N.E.3d 601, 611 (Ill. App. Ct. 2016) (citation omitted) (fraudulent inducement); see also Doe
v. Dilling, 888 N.E.2d 24, 35–36 (Ill. 2008) (fraudulent misrepresentation). “Fraud in the
inducement exists where the party fully understands what he is signing and is aware of the nature
and character of the instrument he has executed, but is deceived by fraudulent representations as
to the facts outside the instrument itself.” Colagrossi, 57 N.E.3d at 611.
To prevail on a consumer fraud claim under the ICFA, a plaintiff must prove: “(1) a
deceptive act or practice by the defendant, (2) the defendant’s intent that the plaintiff rely on the
deception, (3) the occurrence of the deception in a course of conduct involving trade or commerce,
and (4) actual damage to the plaintiff that is (5) a result of the deception.” Ambrosius v. Chicago
Athletic Clubs, LLC, 203 N.E.3d 239, 249 (Ill. App. Ct. 2021) (quoting De Bouse v. Bayer AG, 922
N.E.2d 309, 313 (Ill. 2009)). Deceptive acts include “the use or employment of any deception,
fraud, false pretense, false promise, misrepresentation or the concealment, suppression or omission
of any material fact, with intent that others rely upon the concealment, suppression or omission of
such material fact . . . in the conduct of any trade or commerce.” Id. (quoting 815 ILCS 505/2).
6 The parties agree that Illinois law applies to these claims. See ECF No. 39-1 at 11–12 (discussing standards under
Illinois law); ECF No. 46 at 10 (arguing Illinois law applies and explaining that “[t]his point matters because Illinois
law permits fraud-in-the-inducement claims to proceed notwithstanding an integration clause . . . .”).
Courts “must consider whether the act was deceptive as reasonably understood in light of all the
information available to plaintiffs.” Phillips v. DePaul Univ., 19 N.E.3d 1019, 1031 (Ill. App. Ct.
2014).
Defendants’ fraud theory is based on three purported misrepresentations: (1) Ditslear
promised to add a term to the CPA that would allow SIIM to return the Morpheus8 but did not; (2)
Ditslear failed to disclose the personal guaranty contained in the Lease; and (3) Dr. Lin, a doctor
to whom Invasix directed Dr. Lakho for discussion of the Morpheus8, received a $2,500
commission on the sale. The Court takes each in turn.
A. The Promise to Add a Return Clause Cannot Support Defendants’ Fraud-
Based Claims.
Whether Ditslear falsely represented that he would write in a provision that would allow
Defendants to return the Morpheus8 is a disputed fact. It is undisputed that Dr. Lakho asked for
such a term to be included. However, Ditslear contends he told Dr. Lakho that could not be
accommodated, while Dr. Lakho contends he promised that he would add the term. Ditslear Dep.,
ECF No. 41-5 at 17; Lakho Dep., ECF No. 41-1 at 25, 40. The Court must construe this factual
dispute in the nonmovant’s favor and infer that the promise was made and then not fulfilled. The
question then becomes whether that fact may be actionable under Illinois law. It is not.
For their common law fraud claims, Defendants cannot rely on Ditslear’s misrepresentation
that he would add a return clause because a party cannot justifiably rely on an oral promise not
contained within a contract that the party had the opportunity to review. “[T]he defense of fraud
is, in most situations, unavailable to avoid the effect of the written agreement where the
complaining party could have discovered the fraud by reading the instrument, and was in fact
afforded a full opportunity to do so.” Colagrossi, 57 N.E.3d at 611 (quoting Belleville Nat’l Bank
v. Rose, 456 N.E.2d 281, 284 (Ill. App. Ct. 1983)) (affirming grant of summary judgment where
contract included integration clause and plaintiff “had ample opportunity to consider the terms set
forth in the” fully integrated employment agreement). “[A] party may not enter into a transaction
with its eyes closed to available information and then charge that it has been deceived by another.”
Cozzi Iron & Metal, 250 F.3d at 574 (cleaned up). In other words,
One is under a duty to learn, or know, the contents of a written contract before he
signs it, and is under a duty to determine the obligations which he undertakes by
the execution of a written agreement. . . . And the law is that a party who signs an
instrument relying upon representations as to its contents when he has had an
opportunity to ascertain the truth by reading the instrument and has not availed
himself of the opportunity, cannot be heard to say that he was deceived by
misrepresentations.
Belleville Nat’l Bank, 456 N.E.2d at 284 (citation omitted).
Dr. Lakho did not read the CPA and instead relied on Ditslear’s assurance that “everything
was okay,” which Dr. Lakho interpreted to mean he had added the return clause. See ECF No. 41-
1 at 26–27. However, Dr. Lakho was not forced to sign the agreement without reading it, nor did
he sign it under any duress. Id. at 25–26. He was afforded the opportunity to read the CPA and
chose not to. Moreover, the CPA contains an integration clause:
Customer [SIIM] further acknowledges that this is the complete Agreement
between the parties, is subject to the payment terms and conditions contained or
referred to herein, and expressly disclaims additional and/or different terms and
conditions stated on any purchase orders, sales quotes or other written or oral
proposals shared or discussed between the parties.
ECF No. 41-7. The integration and nonreliance clause is determinative. See Colagrossi, 57 N.E.3d
at 612. Illinois law does not allow Defendants to claim to have been deceived by
misrepresentations that could have discovered by reading the CPA. See id.
Likewise, Defendants cannot establish they were actually deceived by the purported
misrepresentation as required by the ICFA. The ICFA does not require a showing of justifiable
reliance; however, it does require proof that Defendants were “actually deceived by the
misrepresentation in order to establish the element of proximate causation.” Avery v. State Farm
Mut. Automobile Ins. Co., 835 N.E.2d 801, 861 (Ill. 2005) Whether an act was deceptive must be
considered “in light of all the information available to plaintiffs.” Phillips, 19 N.E.3d at 1031.
In Phillips, the Appellate Court of Illinois affirmed the dismissal of a complaint against a
university alleging it had misrepresented employment and salary history of recent law school
graduates. Id. at 1024. The plaintiffs contended the information was “incomplete, false and
materially misleading” because the employment data included jobs that did not require a J.D. and
because the salary data was based only on full-time employment. Id. at 1024–25. The Court
considered all the information available to the plaintiffs, including that the plaintiffs had more
information than what the university reported on the website. Id. at 1031. For example, the ABA
Guides, which the plaintiffs were aware of, provided additional information stating that members
of each graduating class obtained “legal, nonlegal, and full-and part-time jobs,” as well as
expressly stating that some of the reported jobs did not require legal training. Id. Because the
plaintiffs had information available to them that would have negated any misrepresentation, the
court concluded the plaintiffs failed to adequately plead the university committed a deceptive act
or practice by misrepresenting the employment information. Id.
Similarly here, when examining all the information available to Defendants, they have not
shown that Invasix or Ditslear committed a deceptive act by misrepresenting a return clause would
be included. It clearly was not. The CPA, a one-page document containing an integration clause
and no return clause, had no provision allowing for return of the device. Dr. Lakho could have read
the CPA before signing but did not. Although Defendants need not prove justifiable reliance for an
ICFA claim, they cannot assert a deceptive act occurred when Dr. Lakho had the information at his
fingertips to ascertain the truth.
B. The Failure to Disclose the Guaranty Clause Cannot Support Defendants’
Fraud-Based Claims.
For the same reasons, Defendants cannot maintain common law or statutory fraud-based
claims based on Ditslear’s failure to tell Dr. Lakho that signing the Lease with his SSN on it would
bind him personally for the full amount of the obligation. Again, this language appeared on the
Lease, which Dr. Lakho claimed he did not read. ECF No. 41-1 at 30. That Dr. Lakho neglected to
read the Lease does not mean Ditslear concealed any material facts. In fact, nothing was concealed
because the clause was presented to Dr. Lakho in black and white. Defendants cannot assert they
were deceived when the clause was written into the agreement Dr. Lakho signed.
C. The Failure to Disclose the Referral Fee Cannot Support Defendants’
Fraud-Based Claims.
Defendants present a third alleged misrepresentation in their opposition to Invasix’s
motion: Invasix failed to disclose a commission paid to Dr. Lin, a doctor with whom Dr. Lakho
spoke about the benefits of the Morpheus8. Before signing the CPA, Dr. Lakho had wanted to
speak with a doctor who used the Morpheus8. ECF No. 41-1 at 23–24. Ditslear connected Dr.
Lakho with Dr. Lin, a Pennsylvania physician whom Invasix uses as a “key opinion leader.”
Ditslear Dep., ECF No. 41-5 at 19. Dr. Lin “spoke highly about the machine” and the revenue it
generated. Lakho Dep., ECF No. 41-1 at 23–24; ECF No. 41-5 at 19. Dr. Lakho asked Ditslear for
additional doctors who used the machine, and Ditslear provided a link to a website with a list of
doctors, which Dr. Lakho did not visit. ECF No. 41-1 at 24. Ditslear testified that Dr. Lin received
a $2,500 commission from Invasix that was contingent on the sale closing, but he did not know
whether Dr. Lin disclosed this financial interest to Dr. Lakho. ECF No. 41-5 at 19. Dr. Lakho was
not asked about the referral fee or commission at his deposition. The referral fee could not have
been discovered by reading the CPA.
Nonetheless, Defendants cannot rest on this misrepresentation because they have not
established it was material or that it caused them harm. Defendants do not contend that Dr. Lin
misrepresented anything about the Morpheus8 because he would benefit from the sale. Absent
some misrepresentation by Dr. Lin due to his potential bias, there can be no harm resulting from
Dr. Lakho’s belief that Dr. Lin was impartial. See Ambrosius, 203 N.E.3d at 249 (actual damage
must result from material misrepresentation or omission for ICFA claim); Colagrossi, 57 N.E.3d
at 611 (reasonable reliance must be to party’s detriment for common law fraud claim).
Additionally, the harm Defendants raise relates to the contract itself, not how the machine
functioned or the amount of revenue they earned from its use—the topics about which Dr. Lin
spoke. Defendants have, therefore, not put forth sufficient evidence in support of their fraud claims
against Invasix, and Invasix’s motion for summary judgment is granted.
VIII. Conclusion
For the foregoing reasons, the Court grants Invasix’s motion for summary judgment and
denies DLL’s and Dr. Lakho’s motions for summary judgment.