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Fusion Capital Fund II, LLC v. Millenium Holding Group

July 28, 2009

FUSION CAPITAL FUND II, LLC, PLAINTIFF/COUNTERDEFENDANT,
v.
MILLENIUM HOLDING GROUP, INC., ET AL., DEFENDANTS/COUNTERPLAINTIFFS.



The opinion of the court was delivered by: Milton I. Shadur Senior United States District Judge

MEMORANDUM OPINION AND ORDER

Fusion Capital Fund II, LLC ("Fusion"), having prevailed in its claim against Millenium Holding Group, Inc. ("Millenium"),*fn1 has also moved to thrust liability on Millenium's principals Richard Ham and his wife Carla Aufdenkamp (collectively "Hams") on alter ego principles (a doctrine also--and interchangeably--called "piercing the corporate veil"). Fusion's Fed. R. Civ. P. ("Rule") 56 summary judgment motion to that end is ripe for decision, for both sides have tendered submissions in accordance with this District Court's LR 56.1.*fn2

As the ensuing analysis reflects in that regard, neither Hams' LR 56.1(b)(3)(B) response to Fusion's LR 56.1(a)(3) statement nor Hams' own LR 56.1(b)(3)(C) statement does raise any genuine issue of material fact. Hence for the reasons stated here, Fusion's motion for summary judgment against Hams on Complaint Counts I, II and III is granted.

Summary Judgment Standards

Every Rule 56 movant bears the burden of establishing the absence of any genuine issue of material fact (Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986)). For that purpose courts consider the evidentiary record in the light most favorable to nonmovants and draw all reasonable inferences in their favor (Lesch v. Crown Cork & Seal Co., 282 F.3d 467, 471 (7th Cir. 2002)). But a non-movant must produce more than "a mere scintilla of evidence" to support the position that a genuine issue of material fact exists (Wheeler v. Lawson, 539 F.3d 629, 634 (7th Cir. 2008)) and "must come forward with specific facts demonstrating that there is a genuine issue for trial" (id.). Ultimately summary judgment is warranted only if a reasonable jury could not return a verdict for the non-movant (Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). This opinion has applied those standards, but something should be said at the outset about the nature of the parties' submissions in that respect.

On that score Hams' counsel has either misread or misperceived the plain directive of LR 56.1(b)(3), which requires "a concise response to the movant's statement that shall contain...(B) a response to each numbered paragraph in the moving party's statement, including, in the case of any disagreement, specific references to the affidavits, parts of the record, and other supporting materials relied upon...." Thus, apart from Hams' having admitted all other aspects of Fusion's LR 56.1(a)(3) statement:

1. They assert that they "lack personal knowledge or a belief as to the accuracy of the statements of fact made in Statement 1." This is of course not the pleading stage of the case, so that such a deemed disclaimer (drawn from the provisions of Rule 8(b)(5)) is totally out of place.

2. After having admitted Fusion's Statement 6, Hams continue by stating their view as to the legal effect of two aspects of that Statement 6. That does not conform to the LR's requirements either, and so it is stricken as surplusage.

3. Hams' response to Statement 9 includes a non-responsive assertion that they are not admitting the effect of the facts adduced by Fusion. That gratuitous addition is also stricken.

4. Hams' responses to Statements 10 and 11 contain denials that reassert arguments that were made and lost in the Nevada litigation. Those denials are stricken as well.

5. Hams follow their admission of Fusion's Statement 13, which describes Fusion's victory and Millenium's loss via summary judgment in the Nevada action, by going on to "add that Millenium is appealing the District Court's ruling." But the pendency of an appeal from the final judgment in Nevada does not at all affect the preclusive effect of that judgment (see, e.g., Ross ex rel. Ross v. Bd. of Educ. of Township High Sch. Dist. 211, 486 F.3d 279, 284 (7th Cir. 2007) and Supreme Court decisions cited there). Hence Hams' gratuitous addition has no force at all as to either this Court's earlier Opinion or this one.

All of that being true, Fusion's LR 56.1(a)(3) statements are really admitted in their entirety.

On the other side of the "v." sign, Fusion has also included some Rule 8(b)(5)-type disclaimers in its responses to Hams' LR 56.1(b)(3)(C) statement. Again those attempted disclaimers carry no force in the Rule 56 context, but Hams' statements as to which Fusion says it lacks information sufficient to form a belief make no difference in the outcome--again because ...


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