Dist. Ct. did not err in granting defendant-court-appointed receiver’s motion for summary judgment in derivative action by members of entity (that was subject of SEC investigation in allegations of ongoing fraud and misappropriation of client assets) alleging that defendant, who had been appointed receiver to oversee all aspects of entity’s business, breached her fiduciary duties by failing to pursue certain opportunities on behalf of entity that resulted in losses to entity. Ct. found that: (1) plaintiffs were required to show willful and deliberate standard of conduct that required showing that defendant intentionally took actions that she knew violated her fiduciary duties; and (2) plaintiff failed to satisfy said standard or show gross negligence, even though plaintiff alleged that plaintiff failed to bring certain lawsuits, enforce notes, convert debt into profitable stock or enter into certain transactions, where record showed that defendant had investigated each matter, explored different options and made decisions that certain debts were not enforceable or worth pursuing and made informed decision not to pursue certain claims. Fact that plaintiffs contended that defendant made poor business judgments was insufficient to establish either willful and deliberate misconduct or gross negligence.
Federal 7th Circuit Court