The opinion of the court was delivered by: Wayne R. Andersen District Judge
MEMORANDUM OPINION AND ORDER
This case is before the court on the motion of defendant Roger Mitchell to dismiss the complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons set forth below, this motion is granted.
Plaintiff Herbert Eldean ("Eldean") filed a four count complaint on November 20, 2007. The complaint alleges that defendants Echelon Group, Inc. ("Echelon"), Echelon Insurance Services, Inc. ("EIS"), Echelon Property and Casualty Insurance Company, Inc. ("EPC"), and Roger Mitchell ("Mitchell") and Laurence Lacaillade ("Lacaillade"), former directors and officers of the corporate defendants, entered into a scheme whereby they fraudulently enticed Eldean to pay money to become a shareholder of Echelon. Eldean alleges that on or about January 6, 2004, he wire-transferred $50,000 from a trust in his name to a bank in Rantoul, Illinois for the account of EIS, and that he never received a stock certificate, investment certificate or any other evidence of ownership in Echelon pursuant to his alleged investment. Based on these allegations, Eldean's complaint includes four counts against the defendants: 1) Securities Fraud in violation of 815 ILCS 5/12(F-H) and Rule 10B-5, 17 C.F.R. § 240.10B-5, 2) Lost Profits, 3) Common Law Fraud, and 4) Breach of Contract.
The defendants were served with the complaint in December of 2007. Defendant Roger Mitchell was personally served on December 17, 2007. Eldean then settled his claims against Echelon and EPC and they were dismissed from the lawsuit pursuant to stipulation on March 31, 2008. The remaining defendants failed to answer the complaint, and Eldean brought a motion for default judgment against Mitchell, Lacaillade, and EIS on March 24, 2008. This court granted Eldean's motion for default judgment on April 3, 2008. The judgment order against Lacaillade, Mitchell and EIS jointly and severally in the amount of $355,500 was entered on April 11, 2008. A citation to discover asserts was issued as to the defendants in August of 2008. In October of 2008, Mitchell brought a motion to quash the citation as well as a motion to vacate the entry of the default judgment as to him. On October 16, 2008, this court granted Mitchell's motion to vacate and vacated the judgment against Mitchell, as well as any pending citations or garnishments directed against Mitchell or his assets.
On October 30, 2008, Mitchell brought the instant motion to dismiss. The court directed Eldean to respond to the motion by December 12, 2008. However, on December 4, 2008, Eldean's counsel filed a motion to withdraw as counsel for Eldean due to the fact that he had ceased paying his legal bills and was unresponsive to counsel's attempts to contact him. We granted counsel's motion to withdraw as attorney for Eldean on December 18, 2008 and amended the briefing schedule on the motion to dismiss by directing Eldean to respond by January 16, 2009. Eldean was served with the order granting the motion and informing him of the date to respond on January 6, 2009. As of the date of this opinion, Eldean has not filed a pleading responsive to Mitchell's motion, nor has he appeared for any court dates before this court or Judge Schenkier. We now turn to the merits of Mitchell's motion to dismiss.
In deciding a motion to dismiss for failure to state a claim under Rule 12(b)(6), the court must accept all well-pled allegations in the complaint as true, and draw all reasonable inferences in a light favorable to the plaintiff. Jackson v. E.J. Branch Corp., 176 F.3d 971, 978 (7th Cir. 1999).A complaint must describe the claim with sufficient detail as to give the defendants "fair notice of what the . . . claim is and the grounds upon which it rests." Bell Atl. Corp. v. Twombly, 127 S.Ct. 1955, 1964 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)).Further, the "allegations must plausibly suggest that the defendant has a right to relief raising that possibility above a 'speculative level.'" EEOC v. Concentra Health Servs., 496 F.3d 773, 776 (7th Cir. 2007) (citing Twombly, 127 S.Ct. at 1965).
Additionally, Federal Rule of Civil Procedure 9(b) requires that "in all averments of fraud or mistake, the circumstances of fraud or mistake shall be stated with particularity." Fed. R. Civ. P. 9(b). Generally speaking, this standard of particularity requires that a plaintiff specify the "who, what, when, where and how" of the alleged fraud. GE Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1078 (7th Cir. 1997). Simple conclusory allegations of fraud do not satisfy the Rule 9(b) standard. United States ex rel. Gross v. Aids Research Alliance-Chicago, 415 F.3d 601, 604-05 (7th Cir. 2005).
Furthermore, a plaintiff in a securities case must also comply with the pleading requirements of the Private Securities Litigation Reform Act, which outlines requirements that plaintiffs must follow in order to avoid dismissal of their securities claims. 15 U.S.C. § 74u-4(b)(1)-(2). Specifically, "the complaint shall specify each statement alleged to have been misleading, [and] the reason or reasons why the statement is misleading." 15 U.S.C. § 78u-4(b)(1)(B). Additionally, where "the plaintiff may recover money damages only on proof that the defendant acted with a particular state of mind, the complaint shall...state with particularity facts giving rise to a strong inference that the defendant acted with the required state of mind." 15 U.S.C. § 78u-4(b)(2). If a plaintiff fails to include the requisite specific allegations, the court must dismiss the complaint. 15 U.S.C. § 78u-4(b)(3)(A).
I. Count I: Securities Fraud
In Count I, Eldean seeks damages pursuant to Section 12 of the Illinois Securities Act of 1953 ("the Act"), 815 ILCS 5/12, and Rule 10b-5, 17 C.F.R. 240.10b-5. However, Count I is dismissed for two reasons: 1) it is barred by the three year statute of limitations, and 2) Eldean ...