The opinion of the court was delivered by: JAMES HOLDERMAN, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Wachovia Bank, N.A. ("Wachovia"), a North Carolina
corporation with its principle place of business in North
Carolina, filed suit on June 9, 2004 invoking this court's
diversity jurisdiction pursuant to 28 U.S.C. § 1332, against
defendant Foster Bankshares, Inc., a Delaware corporation doing
business in Illinois as Foster Bank ("Foster"), seek a
declaratory judgment that Foster breached it warranty to
Wachovia. (Dkt. No. 1). Foster filed a third-party complaint on
July 12, 2004 against third-party defendant, Sunjin Choi Choi,
("Choi"), an Illinois resident. (Dkt. No. 3). Wachovia and Foster
have filed the present cross motions for summary judgment on
April 29, 2005 and May 2, 2005. (Dkt. Nos. 21, 24). For the
reasons set forth below, this court grants Wachovia's motion for
summary judgment and denies Foster's motion for summary judgment. BACKGROUND
This litigation is between the two primary banks involved in
the processing and payment of a fraudulent check. The issue
presented by the case is the responsibility to be borne between
A company called MediaEdge, which is not a party to this case,
issued check number 400-413142 on November 13, 2002 in the amount
of $133,026.00. (Dkt. No. 23 at ¶ 9). MediaEdge's check was drawn
on its account with Wachovia and was made payable to CMP Media
Inc. (Id.) That check was intercepted and the check, or a copy
of the check, was altered. The check's payee was changed from CMP
Media Inc to Sunjin Choi Choi. (Id.) The altered check, or a
copy of the check, was deposited into Choi's account at Foster
and then presented to Wachovia for payment. (Id. at ¶ 12-13).
Wachovia paid Foster from MediaEdge's account. (Id.) Wachovia
and Foster later learned of the alleged theft of the check when
CMP Media Inc., the intended payee of the check, failed to
receive the payment and notified MediaEdge in January 2003.
(Id. at 15).
MediaEdge has sued Wachovia in New York seeking reimbursement.
Wachovia, in turn, is suing Foster for reimbursement in light of
MediaEdge's suit. Wachovia seeks from this court a declaration
that Foster is liable for the original amount of the check of
$133,036.00 plus interest, costs and fees including the
attorney's fees incurred by Wachovia in defending in the New York
suit against MediaEdge. Foster argues that Wachovia must bear the
loss and filed a cross-motion for summary judgment on May 2,
2005. (Dkt. No. 24).
Under Rule 56(c) of the Federal Rules of Civil Procedure,
summary judgment is proper "if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show
that there is no genuine issue as to any material fact and that
the moving party is entitled to a judgment as a matter of law."
Fed.R.Civ.P. 56(c). In ruling on a motion for summary
judgment, the evidence of the nonmovant must be believed and all
justifiable inferences must be drawn in the nonmovant's favor.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). This
court's function is not to weigh the evidence and determine the
truth of the matter, but to determine whether there is a genuine
issue for trial. A party who bears the burden of proof on a
particular issue, however, may not rest on its pleadings, but
must affirmatively demonstrate, by specific factual allegations,
that there is a genuine issue of material fact that requires
trial. Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986).
In considering a motion for summary judgment, this court is not
required to scour the record in search of evidence to defeat the
motion; the nonmoving party must identify with reasonable
particularity the evidence upon which the party relies. Johnson
v. Cambridge Indus., Inc., 325 F.3d 892, 898 (7th Cir. 2003).
Finally, the evidence relied upon must be competent evidence of a
type otherwise admissible at trial. Stinnett v. Iron Work
Gym/Exercise Health Spa, Inc., 301 F.3d 610, 613 (7th Cir.
A. Foster's Failure to Comply with Local Rule 56.1 and Case
Before proceeding to the substance of the motions, the court
must discuss Foster's failure to follow the requirements of Local
Rule 56.1 and this court's case management procedures. Both the
local rules and the court's case management procedures are
located on the court's website. See also Malec v. Sanford,
191 F.R.D. 581 (N.D. Ill. 2000) (discussing the requirements of Local Rule 56.1).
The court's case management procedure requires a motion for
summary judgment, memorandum, Rule 56.1 statement and exhibits to
be provided in separate documents filed separately from one
another. Foster's submissions are combined together and do not
comply with the court's requirements.
Foster's failure to follow Local Rule 56.1 is more significant.
"A district court is entitled to expect strict compliance with
[Local] Rule 56.1." Ammons v. Aramark Uniform Servs., Inc.,
368 F.3d 809, 817 (7th Cir. 2004). The result of a failure to follow
Local Rule 56.1 when responding to the opposing party's statement
of facts can be dramatic. The failure to properly respond results
in admission of other party's facts for the purposes of
evaluating summary judgment. Smith v. Lamz, 321 F.3d 680, 683
(7th Cir. 2003). "[I]mproper denials . . . and a mere
disagreement with the movant's asserted facts is inadequate if
made without reference to specific supporting material." Id.
(citations omitted). "A general denial is insufficient to rebut a
movant's factual allegations; the nonmovant must cite specific
evidentiary material justifying the denial." Malec,
191 F.R.D. at 584.
Foster's response to Wachovia's statement of facts of May 20,
2005 (Dkt. No. 29), does not comply with the requirements of
Local Rule 56.1. The statement contains general denials and does
not contain specific citations to documents in the record that
demonstrate a genuine issue of material fact. Foster does provide
a better effort of citing to evidence in the record when it
provides its own statement of undisputed facts in support of its
motion for summary judgment. (Dkt. No. 24). However, Foster's
statement of undisputed facts in support of its own ...