Commercial Banking, Collections, and Bankruptcy

Harold v. Steel

Federal 7th Circuit Court
Harold v. Steel
Civil Court
Fair Debt Collection Practices Act
Citation
Case Number: 
No. 14-1875
Decision Date: 
December 11, 2014
Federal District: 
S.D. Ind., Indianapolis Div.
Holding: 
Affirmed
Dist. Ct. did not err in dismissing for want of prosecution plaintiff’s Fair Debt Collection Practices Act (FDCPA) action, where plaintiff alleged that defendant-debt collector violated section 1592e of FDCPA by making false statements in connection with defendant’s successful state-court action seeking to garnish plaintiff’s wages arising out of 20-year-old debt. Record showed that plaintiff did not seek review of state-court garnishment order, and Rooker-Feldman doctrine precluded plaintiff from subsequently seeking to alter state-court judgment by filing instant claim alleging that defendant made false statements during prior state-court litigation.

Nelson Brothers Professional Real Estate, LLC v. Freeborn & Peters LLP

Federal 7th Circuit Court
Nelson Brothers Professional Real Estate, LLC v. Freeborn & Peters LLP
Civil Court
Legal Malpractice
Citation
Case Number: 
No. 14-2046
Decision Date: 
December 5, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed
Record contained sufficient evidence to support jury’s finding in favor of plaintiffs in legal malpractice action against defendant-law firm, where plaintiffs alleged that defendant breached duty of loyalty to plaintiffs by favoring other member of plaintiffs’ joint venture by neglecting to advise plaintiff of existence of certain mechanics’ liens on commercial property purchased by joint venture that caused investors to shy away from investing in joint venture, and by failing to advise plaintiffs with respect to risks associated with personally guaranteeing certain loans made on behalf of joint venture. Defendant could not assert on appeal any statute of limitations defense, where defendant failed to raise it until after jury’s verdict. Moreover, member of defendant’s law firm admitted to failing to advise plaintiffs regarding potential conflicts of interest between plaintiffs and other member of joint venture, to whom defendant had also provided legal services.

Senate Bill 2799

Topic: 
FOIA

(Currie, D-Chicago) amends the FOIA Act to do two things. (1) It expands exemption (f) to include “correspondence” as exempt from a FOIA request. But this exemption is waived if and only if the specific record is publicly cited and identified by the head of the public body. If the specific record is publicly cited and identified by the head of the public body, then only those portions of the specific record publicly cited and identified are no longer exempt. Records exempt from disclosure under this subsection and not publicly cited and identified by the head of the public body, including, but not limited to, purely factual material, remain exempt regardless of whether the record was adopted or incorporated into a final decision of the public body. (2) If the public body produces the records after a suit has been filed under this Section, but before the court renders a final judgment, the court must award reasonable attorney’s fees and costs if the court imposes a civil penalty under subsection (j). For purposes of this subsection (i), a requester “prevails” if the person obtains relief through: (a) a court-approved settlement or consent decree; or (b) a final unappealable judgment from a court of competent jurisdiction. House Amendment No. 3 remains in House Executive Committee.

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Senate Bill 2221

Topic: 
Statute of limitation for pollutants
(Sullivan, D-Quincy; Currie, D-Chicago) amends the Code of Civil Procedure to make an exception to the 10-year statute of limitation for personal injuries or death caused by the discharge into the environment of any pollutant. This would include any waste, hazardous substance, irritant, or contaminant (including but not limited to, smoke, vapor, soot, fumes, acids, alkalis, asbestos, toxic or corrosive chemicals, radioactive waste or mine tailings.). Scheduled for hearing Dec. 1 in House Judiciary Committee.
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Senate Bill 3075

Topic: 
Juror fees and jury composition
(Madigan, D-Chicago; Mulroe, D-Chicago) makes the following changes for juror pay: (1) Requires counties to pay jurors $25 for the first day of service and thereafter $50 for each day of service. (2) Deletes the current requirement to pay for jurors’ travel expenses. (3) Requires all trials by jury in civil cases to be six jurors but still requires that the verdict be unanimous. If alternate jurors are requested, an additional fee established by the county must be charged for each alternate juror requested. Effective date would be June 1, 2015. Senate Bill 3075 is scheduled for hearing Dec. 1 in House Judiciary Committee.
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In re Duckworth

Federal 7th Circuit Court
In re Duckworth
Civil Court
Bankruptcy
Citation
Case Number: 
Nos. 14-1561 & 14-1650 Cons.
Decision Date: 
November 21, 2014
Federal District: 
C.D. Ill.
Holding: 
Reversed and remanded
In action by lender seeking to enforce its security interest in property held by debtor, Dist. Ct. erred in enforcing said security interest where security agreement contained wrong date of promissory note signed by debtor, and where Dist. Ct. considered parole evidence to obtain correct date of said promissory note. Although lender could use parole evidence to correct instant mistake when seeking to enforce security interest directly with debtor, lender could not use parole evidence against bankruptcy trustee. As such, instant security agreement did not give lender security interest in specified collateral that could be enforced against trustee.

In re: Katsman

Federal 7th Circuit Court
In re: Katsman
Civil Court
Bankruptcy
Citation
Case Number: 
No. 13-1881
Decision Date: 
November 19, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Affirmed
Dist. Ct. did not err in reversing Bankruptcy Ct. order that rejected creditor’s objection to debtor’s discharge of listed debts in her bankruptcy petition, where record showed that debtor failed to list said creditor’s debt, as well as debts of four other creditors and failed to list certain jointly owned property, and where Ct. of Appeals found that said failures established pattern of reckless indifference to truth so as to support Dist. Ct.’s denial of discharge. Moreover, Bankruptcy Ct. erred in believing that “fraudulent” making of false oath, for purposes of 11 USC section 727(a)(4)(A), required showing that false oath resulted in pecuniary gain for debtor, since finding of reckless indifference to truth was sufficient basis to establish debtor’s fraudulent intent in instant bankruptcy proceeding.

Hollywood Boulevard Cinema LLC v. FPC Funding II, LLC

Hollywood Boulevard Cinema LLC v. FPC Funding II, LLC
Illinois Appellate Court
Civil Court
Guaranty
Citation
Case Number: 
2014 IL App (2d) 131165
Decision Date: 
Monday, November 17, 2014
District: 
2d Dist.
Division/County: 
Du Page Co.
Holding: 
Affirmed.
Justice: 
ZENOFF
Counterdefendant is managing member of company operating movie theater, which entered into equipment finance lease with credit company for lease of 1200 theater seats and custom-made elevator, and he personally guaranteed company's obligations under lease. Credit company allegedly assigned lease and personal guaranty to another company which sued member for breach of guaranty, after theater sued that company. A party is not required to file new or amended notice of appeal after entry of amended judgment, unless party intends to challenge amendment to judgment. Member lacks standing to assert noncompliance with agreement as basis to challenge assignment of lease. (HUTCHINSON and BIRKETT, concurring.)

TMG Kreations, LLC v. Seltzer

Federal 7th Circuit Court
TMG Kreations, LLC v. Seltzer
Civil Court
Contracts
Citation
Case Number: 
Nos. 13-3535 & 13-3730 Cons.
Decision Date: 
November 13, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Reversed and remanded
Dist. Ct. erred in granting defendants’ motion for summary judgment in plaintiffs’ action alleging that defendants violated terms of asset-purchase agreement concerning exclusive license to sell certain “Kashwere” products in Japan when defendants sold rights in said contract to third-party without obtaining plaintiffs’ permission and marketed certain products with Kashwere product name that did not contain “chenille” fabric. Language in contract required defendants to seek permission from plaintiffs to sell defendants’ rights in contract to third-party, and fact that sale of rights to third-party was not preceded by “written offer” as mentioned in agreement did not excuse defendants from obtaining permission for sale from plaintiffs. Moreover, question of fact remained as to whether defendants violated non-compete clause in agreement, where, among other things, one defendant allegedly made efforts to damage one of plaintiff’s businesses by accusing said plaintiff of engaging in unlawful activities and selling inferior products.

Smith v. Greystone Alliance, LLC

Federal 7th Circuit Court
Smith v. Greystone Alliance, LLC
Civil Court
Fair Debt Collection Practices Act
Citation
Case Number: 
No. 14-1758
Decision Date: 
November 13, 2014
Federal District: 
N.D. Ill., E. Div.
Holding: 
Vacated and remanded
Dist. Ct. erred in dismissing for lack of jurisdiction plaintiff’s Fair Debt Collection Practices Act claim after finding that defendant’s settlement offer of $1,500 rendered her claim moot because it exceeded any potential recovery she could have obtained. Under Gates, 430 F3d 429, instant dismissal would only be proper if defendant’s offer satisfied plaintiff’s monetary demand, and record showed that plaintiff demanded more than $1,500. Moreover, Dist. Ct. cannot determine merits of plaintiff’s claim and then determine that it lacked jurisdiction where defendant had offered more than what Dist. Ct. believed to be value of claim.