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Tahir v. Import Acquisition Motors

July 15, 2010

MUZZAFFER S.M. TAHIR, PLAINTIFF,
v.
IMPORT ACQUISITION MOTORS, L.L.C., AN ILLINOIS LIMITED LIABILITY COMPANY, D/B/A BENTLEY GOLD COAST, LAMBORGHINI CHICAGO, INC., AN ILLINOIS CORPORATION, DOWNERS MOTORS, INC., AN ILLINOIS CORPORATION F/K/A LUXURY MOTORS INC., BENTLEY MOTORS INC., JOSEPH ABBAS, MARK HOPPE, AND MARC IOZZO DEFENDANTS.



The opinion of the court was delivered by: Joan Humphrey Lefkow United States District Judge

OPINION AND ORDER

Judge Joan H. Lefkow

Muzaffer S.M. Tahir filed a three-count amended complaint against Import Acquisition Motors ("IAM"), Lamborghini Chicago, Inc. ("Lamborghini"), Downers Motors, Inc. ("Downers"), Bentley Motors, Inc. ("BMI"), Joseph Abbas, Mark Hoppe, and Marc Iozzo, arising from the alleged failure to deliver a car Tahir purchased from the Bentley Gold Coast car dealership ("BGC").*fn1 Count I for breach of contract is brought against IAM, Lamborghini, Downers, Abbas, Hoppe, and Iozzo. Count II for violation of the Illinois Consumer Fraud and Deceptive Business Practices Act ("the Act"), 815 Ill. Comp. Stat. 505/2, is brought against all defendants. Count III for conversion is brought against IAM, Downers, Abbas, and Iozzo.*fn2

Hoppe, Iozzo, and Lamborghini have filed motions to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). IAM seeks dismissal of Count I, and BMI seeks dismissal of Count II. For the following reasons, BMI's motion [#32] is granted, IAM's motion [#35] is denied, Lamborghini's motion [#39] is granted in part and denied in part, and Hoppe and Iozzo's motion [#42] is granted.

BACKGROUND*fn3

BGC is a Chicago car dealership at the center of this case. It was operated by Downers, of which Abbas was president. Four others-Lamborghini, IAM, Iozzo, and Hoppe-are alleged to have had managerial control over BGC. Iozzo is the manager of IAM and the president of Lamborghini, while Hoppe serves the latter as corporate secretary. BMI is the franchisor of the Bentley brand.

On August 4, 2009, Tahir entered into a contract with BGC for the purchase of a 2008 Bentley Spur. The parties agreed that Tahir would pay $135,000, and that the car would be delivered to his Calgary, Alberta home by August 17, 2009. Tahir made three payments, beginning with a $20,000 security deposit to Lamborghini. The balance of $115,197 was paid by two wire transfers to IAM's bank account. The car was never delivered. When Tahir contacted BGC, he spoke with Abbas, who denied Tahir's demands for a refund and told him that Hoppe and Iozzo had custody of the money. The $20,000 deposit was credited back to Tahir in October 2009, after the initial filing of the complaint, though the money transferred via wire transmissions is still outstanding.

LEGAL STANDARD

A motion to dismiss under Rule 12(b)(6) challenges a complaint for failure to state a claim upon which relief may be granted. See Fed. R. Civ. P. 12(b)(6); Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1080 (7th Cir. 1997). The court must accept as true all well-pleaded facts in the plaintiff's complaint, with all reasonable inferences drawn in the plaintiff's favor. Dixon v. Page, 291 F.3d 485, 486 (7th Cir. 2002). Simply providing a defendant with notice of the claims against her is no longer enough; a complaint fails under Rule 12(b)(6) unless it establishes that the requested relief is plausible on its face. Ashcroft v. Iqbal, --- U.S. ----, 129 S.Ct. 1937, 1949, 173 L.Ed. 2d 868 (2009); see also Bell Atl. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed. 2d 929 (2007). Additionally, failure to plead a necessary element for relief calls for dismissal. R.J.R. Servs., Inc. v. Aetna Cas. & Sur. Co., 895 F.2d 279, 281 (7th Cir. 1989). Allegations of fraud are subject to the heightened pleading standard of Rule 9(b), which requires a plaintiff to "state with particularity the circumstances constituting fraud or mistake." Fed. R. Civ. P. 9(b).

DISCUSSION

I. Breach of Contract (Count I)

A. Iozzo and Hoppe

Tahir alleges that Iozzo was the manager of IAM. IAM is a limited liability company ("LLC"), and under the Limited Liability Company Act, "a member or manager [of an LLC] is not personally liable for a debt, obligation, or liability of the company solely by reason of being or acting as a member or manager." 805 Ill. Comp. Stat. 180/10-10(a). This is true where the debts, obligations, and liabilities arise out of either tort or contract. Id. Insofar as Iozzo is being sued solely on the basis of his position as IAM's manager, that portion of Count I against Iozzo must be dismissed, as there is no secondary liability for a manager of an LLC under the Limited Liability Company Act.*fn4

Additionally, neither Iozzo nor Hoppe could have been parties to the contract as a result of their alleged positions as corporate officers of Lamborghini. Privity is an essential element of a suit for breach of contract, see Kaplan v. Shure Bros., Inc., 153 F.3d 413, 417 (7th Cir. 1998): Tahir's failure to allege facts from which privity could be plausibly inferred requires that this portion of his complaint be dismissed. Reading his pleadings as charitably as possible, his claim amounts to the assertion that, because Iozzo and Hoppe were allowed to enter into contracts on behalf of BGC, they are parties to the contract. This overlooks the fact that "[o]ne of the purposes of a corporate entity is to immunize the corporate officer from individual liability on contracts entered into in the corporation's behalf." Nat'l Acceptance Co. of Am. v. Pintura Corp., 418 N.E.2d 1114, 1116--17, 94 Ill. App. 3d 703, 50 Ill. Dec. 120 (1981). Though a corporation can be held responsible for the acts of its officers, the reverse is not generally true. See Mark I, Inc. v. Gruber, 38 F.3d 369, 371 (7th Cir 1994); G2 Enters., LLC v. Nee, No. 05 C 5803, 2006 WL 1647518, at *3 (N.D. Ill. June 7, 2006) (holding that a corporate officer was not bound by a contract signed by him in his official capacity, ...


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