Walworth Investments-LG, LLC v. Mu Sigma, Inc.

Illinois Appellate Court
Civil Court
Fraud
Citation
Case Number: 
2021 IL App (1st) 191937
Decision Date: 
Tuesday, March 30, 2021
District: 
1st Dist.
Division/County: 
Cook Co., 2d Div.
Holding: 
Reversed and remanded.
Justice: 
LAVIN

Plaintiff LLC, a former stockholder, filed action against privately held data analytics company and its CEO alleging they committed a reverse "Madoff scheme" to fraudulently induce Plaintiff to enter into a stock repurchase agreement (SRA) to sell its substantial ownership interest in the company. Genuine issues of material fact exist as to whether the SRA contained effective antireliance language, or which party, if any, disclaimed reliance. Dismissal of Plaintiff's breach of contract and unjust enrichment claims based on the general release provision was premature. Where an unjust enrichment claim is based on a tort theory that Plaintiff was fraudulently induced to enter into a written agreement, it is not barred by existence of contract between the parties. Summary judgment for Defendants is reversed. (FITZGERALD SMITH, concurring; PUCINSKI, specially concurring.)