Commercial Banking, Collections, and Bankruptcy

Bankruptcy Ct. did not err in finding that creditor had not established that debtor acted in any fiduciary capacity so as to render instant debt non-dischargeable under 11 USC section 523(a)(4) of Bankruptcy Code under circumstances where debtor failed to pay outstanding advertising debts out of money fronted to debtor by creditor. While debtor may have had fiduciary duty towards creditor under Illinois law to extent that his company was insolvent during time that part of instant debt arose, said state-law duty would not have constituted basis for non-dischargeability since creditor failed to show that debtor was acting as trustee without reference to any wrong arising out of instant debt. Moreover, instant creditor failed to show existence of either express or implied trust arising out of instant contract to provide creditor with bill-paying services.

In action alleging that defendant breached financing agreement by failing to pay plaintiff for go-karts that defendant had purchased from third-party, Dist. Ct. did not err in granting plaintiff's motion for summary judgment as to defendant's counterclaim that plaintiff actually breached financing agreement by failing to pay manufacturer of go-karts. While defendant attempted to establish said counterclaim solely through two letters from manufacturer claiming that it had not been paid for said go-karts, Dist. Ct. could properly conclude that said letters constituted inadmissible hearsay evidence. Moreover, Dist. Ct. properly rejected defendant's related claim that it was not required to pay plaintiff pursuant to financing agreement because said go-karts were defective since defendant had failed to present any facts suggesting that plaintiff had warranted goods that it had merely financed.

Dist. Ct. did not err in granting defendant’s motion for summary judgment in two-count action alleging that defendant breached non-disparagement provision in 2006 settlement of prior lawsuit by alleging in subsequent Texas lawsuit that plaintiff was involved in racketeering. Indiana’s absolute privilege protecting statements made in course of judicial proceedings applied to preclude plaintiff from obtaining any recovery in said count. Moreover, Dist. Ct. did not err in entering judgment in defendant’s favor in second count alleging that defendant’s act of removing plaintiff from trade show that was witnessed by business associates also violated non-disparagement provision since said provision only covered acts that served to denigrate plaintiff’s economic, business or professional interests and not acts that merely caused plaintiff personal embarrassment.

Record failed to contain sufficient evidence to support jury's award of $5.6 million to plaintiff in breach of contract action calling for plaintiff to market new software program generated by defendant used to identify potential car buyers for auto dealerships. While jury assessed damages based on projected enrollment of auto dealerships, defendant was entitled to new damages hearing where record failed to support expert witness' assumptions regarding either number of projected buyer leads or appropriate ratio of wholesale leads to retail sales. Fact that plaintiff had proven track record of sales for different software program was insufficient to support instant damages award where parties were dealing with new and unproven software program.