Aspen Technology, Inc. v. Applied Manufacturing Technologies, Inc.

23 Mass. L. Rptr. 462
CourtMassachusetts Superior Court
DecidedJanuary 9, 2008
DocketNo. 05CV3113F
StatusPublished

This text of 23 Mass. L. Rptr. 462 (Aspen Technology, Inc. v. Applied Manufacturing Technologies, Inc.) is published on Counsel Stack Legal Research, covering Massachusetts Superior Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Aspen Technology, Inc. v. Applied Manufacturing Technologies, Inc., 23 Mass. L. Rptr. 462 (Mass. Ct. App. 2008).

Opinion

Curran, Dennis J., J.

INTRODUCTION

Pursuant to Mass.R.Civ.P. 56, the defendant Applied Manufacturing Technologies, Inc. (“AMT”), brings this motion for summary judgment against the plaintiff, Aspen Technology, Inc. (“AspenTech”). AspenTech filed a four-count complaint against AMT [463]*463alleging breach of contract (count I), breach of the covenant of good faith and fair dealing (count II), violation of G.L.c. 93A (count III), and intentional interference with prospective economic advantage (count IV). AMT has moved for summary judgment as to all counts.

In response to AMT’s motion for summary judgment, AspenTech filed its own motion for partial summary judgment, asking this court to grant summary judgment as to its breach of contract claim and a permanent injunction. For the foregoing reasons, AMT’s motion for summary judgment is hereby ALLOWED in part and DENIED in part and AspenTech’s cross motion for summary judgment is DENIED.

FACTUAL BACKGROUND

AspenTech is a Delaware corporation with a principal place of business in Cambridge, Massachusetts, whose business consists of licensing software and selling related consulting services to process manufacturers in the petroleum, chemical, and pharmaceutical industries. A portion of AspenTech’s software products are used and licensed in assisting manufacturers in “process modeling.” Process modeling allows engineers to simulate and manipulate chemical reactions on computers to optimize a particular manufacturing process.

Specifically, and pertinent to the circumstances before the court, AspenTech’s various “process control” software receives and examines data from the process units, examines it, and then calculates the most efficient method to operate the process. There are three distinct levels of control in such a refining process. The most basic level is the “distributed control system” or “DCS.” In DCS, sensors and activators control the flow of a material through a process unit. Based on pre-established set points, the DCS opens or closes valves or other devices to alter conditions in the refining units in an attempt to maximize the refining process.

The second layer of control is “advanced process control" or “APC.” APC uses linear equations and models to define setpoints on the DCS for an individual refinery or application. AspenTech’s APC software is called “DMCPlus.” Additionally, APC may utilize modeling or inferential software in making DCS adjustments. Modeling software provides mathematical models of the refining process, which are then compared with theoretical models to adjust the DCS. Inferential software provides calculations of properties in the refining process which cannot be directly measured during the refining process. AspenTech has software in these two areas — "Aspen hydrotreater" being the modeling software and “Aspen IQ” being the inferential software.

The third, and most advanced, layer of control is known as “real time optimization” or “RTO.” RTO uses non-linear or open equations and models to optimize plant operations globally. AspenTech licenses RTO software under the name “AspenPlus Optimizer.”

In 2002, Steven Finlayson (“Mr. Finlayson”), then head of AspenTech’s Services Division, left AspenTech. In 2003, Mr. Finlayson formed AMT. AMT is a Texas corporation that provides engineering services to refineries to study and/or implement APC or RTO services. AMT does not develop or sell software.

In 2003, AspenTech and AMT entered into a “Systems Integration Agreement” (“SI Agreement”) which, among other things, provided AMT with a number of software “internal use licenses” for AspenTech Software. Pursuant to the terms of the SI Agreement, AMT had the right to install a limited number of copies of AspenTech’s software on their computers for their own internal use. There were several conditions in the agreement that constrained AMTs use of the software, two of which are relevant here.

Specifically, section 2.7.2 provides that AMT agreed not to:

. . . directly or indirectly interface, integrate, or interconnect AspenTech software to or with other software products that compete with AspenTech. Notwithstanding any other provision in this Agreement, AspenTech grants [AMT] the right to interface the Aspen Plus Optimization technology to competitors’ multivariable control technologies as part of client service projects.
If at any time during the term of this Agreement, AspenTech no longer offers a fully supported, commercial, open-equation modeling and optimization system (such as Aspen Plus version 11), the restriction outlined in this section 2.7.2 will be removed.

Section 2.8 provides:

SI agrees to exclusively use AspenTech software products (excluding those utilized specifically for advanced process control, but including all others not listed in Exhibit A) to provide, perform, or engage in any services or other commercial offerings with or for the benefit of the following Aspen-Tech customers:
BP
ExxonMobil
The Dow Chemical Company
BASF
ATOFINA
However, on a case-by-case basis, by mutual agreement, SI and AspenTech may identify sales opportunities, jointly bid on and execute projects for any such customer.

In 2005, Total Petrochemicals1 (‘Total") invited both AspenTech and AMT to bid on a services contract. Specifically, the contract pertained to certain maximization and efficiency processes with regard to Total’s GHT hydrotreater unit at its Port Arthur, Texas refinery. A hydrotreater is operated as part of the manufacturing process whereby crude oil is converted into gasoline and/or other gases. Total eventually awarded the contract to AMT. As part of its bid proposal, AMT [464]*464touted its contractor/subcontractor relationship with a company named Axens. Axens is a company that licenses a process to create inferential calculations that can be utilized in the APC process in the hydro-treater. Axens’s calculations software is called “Axens Prime G+ software.” After Total awarded AMT the contract, AspenTech brought this action, claiming that AMT breached the SI Agreement.

DISCUSSION

Summary Judgment Standard

Summary judgment is appropriate when the summary judgment record shows that “there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Mass.R.Civ.P. 56(c); DuPont v. Commissioner of Corrections, 448 Mass. 389, 397 (2007). A fact is “material” if it would affect the outcome of the suit. Carey v. New England Organ Bank, 446 Mass. 270, 278 (2006); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A dispute is “genuine” where a reasonable finder of fact could return a verdict for the non-moving party. Flesner v. Technical Communications Corp., 410 Mass. 805, 809 (1991), citing Anderson, 477 U.S. at 252. The moving party bears the initial burden of demonstrating the absence of a triable issue and that the summary judgment record entitles him to judgment as a matter of law. Ng Brothers Construction, Inc. v. Cranney, 436 Mass. 638, 644 (2002), citing Pederson v. Time, Inc., 404 Mass.

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Bluebook (online)
23 Mass. L. Rptr. 462, Counsel Stack Legal Research, https://law.counselstack.com/opinion/aspen-technology-inc-v-applied-manufacturing-technologies-inc-masssuperct-2008.