The opinion of the court was delivered by: James B. Zagel United States District Judge
MEMORANDUM OPINION AND ORDER
In January 2008, Plaintiff William Jackson ("Jackson") filed a complaint against Defendant Jack Ackerman ("Ackerman") alleging default under a loan agreement. Jackson now moves for summary judgment, seeking relief in the amount of $500,000. For the following reasons, Jackson's motion is denied.
Summary judgment should be granted when "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). The facts presented are to be construed in a light most favorable to the nonmoving party. Smith v. City of Chicago, 242 F.3d 737, 742 (7th Cir.2001). Once the moving party has set forth the basis for summary judgment, the burden then shifts to the nonmoving party who must go beyond mere allegations and offer specific facts showing that there is a genuine issue for trial. Fed.R.Civ.P. 56(e); see Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). The nonmoving party must offer more than "[c]onclusory allegations, unsupported by specific facts" in order to establish a genuine issue of material fact." Payne v. Pauley, 337 F.3d 767, 773 (7th Cir.2003) (citing Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 888 (1990)).
III. STATEMENT OF RELEVANT FACTS
Plaintiff Jackson and Defendant Ackerman are both one-third owners of Medinah Partners, LLC. In April 2004, Jackson loaned Ackerman $500,000 and the two executed a promissory note ("Note") in that amount. On the same day, Ackerman also executed and delivered to Jackson a loan agreement ("Agreement") whereby Ackerman pledged his equity interest in Medinah Parnters, LLC. The Agreement requires that Ackerman, by May 31st of each calendar year, provide to Jackson a copy of his filed tax return. The Agreement also requires Ackerman to notify Jackson in writing of any realized capital gains, including gain on assets held in joint tenancy or tenancy in the entirety by Ackerman and his spouse, within three days of the sale of any such capital gain. Further, the Agreement requires that Ackerman maintain a life insurance policy for at least $500,000 until the principal and accrued interest on the loan are paid in full, and that the policy be assigned to Jackson as security for the loan. Under the Note, an event of default includes any default under the loan agreement.
On January 11, 2008, Jackson filed a complaint against Ackerman alleging default under the pledge agreement. In his complaint, Jackson alleges two grounds for default: (1) Ackerman failed to provide his 2005 and 2006 filed tax returns, and (2) Ackerman failed to notify Jackson of the sale of his principal residence, in violation of the capital gains clause.
On June 23, 2008, the Sun Life Assurance Company of Canada notified Jackson that the policy Ackerman purchased as security for the loan had lapsed due to non-payment of the May 2008 premium. According to Ackerman, he had maintained other policies in replacement of this policy, thereby satisfying the requirement in the Agreement.
On July 21, 2008, Jackson gave notice to Ackerman of Ackerman's default and demanded payment of the entire indebtedness. On August 5, 2008, Jackson gave notice to Ackerman of his election to retain Ackerman's interest in Medinah Partners, LLC, the collateral identified in the Agreement.
Ackerman states that at all relevant times, the monthly interest payments required of him under the Agreement were paid by William Russell, President and one-third owner of Medinah Management Corporation (manager of Medinah Partners, LLC) from Ackerman's monthly distribution from Medinah Partners. Ackerman has provided an e-mail demonstrating Jackson's attorney's awareness of the distribution arrangement. According to Jackson, Ackerman failed to make the $4000 interest payment on the note for the months of August and September, a claim which Ackerman denies. On September 2, 2008, Jackson wrote a letter to Russell alerting him of Ackerman's default on the loan as a result of Ackerman's alleged failure to (1) provide his 2005 and 2006 tax returns, (2) notify Jackson of the sale of his home, and (3) maintain his Sun Life Assurance Company policy. The letter then directed a transfer of Ackerman's voting rights to Jackson. The letter made no mention of unmade interest payments.
Jackson now moves for summary judgment on the basis of the lapsed insurance policy and ...