Business Credit Leasing v. City of Biddeford, Third-Party Biddeford School Department, Third-Party v. Instructional Systems, Inc., Third-Party

BAILEY ALDRICH, Senior Circuit Judge. .

On April 17, 1989 Biddeford School Department (Biddeford 1 ) contracted with Instructional Systems, Inc. (ISI), a New Jersey corporation, to purchase a computer-assisted learning system and services from ISI for approximately $580,000 over a six year period. The agreement provided,

Biddeford has the right to cancel this agreement after the first year of operation. If Biddeford opts to cancel, Instructional Systems will take over the equipment lease and remove the equipment.

At that time, as ISI knew, there was not yet an equipment lease. On September 21,…