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Broaddus v. Shieldss

September 1, 2010

BRET A. BROADDUS., PLAINTIFF/COUNTER-DEFENDANT,
v.
KEVIN SHIELDS, DEFENDANT/COUNTER-PLAINTIFF.



The opinion of the court was delivered by: Amy J. St. Eve, District Court Judge

MEMORANDUM OPINION AND ORDER

Before the Court is Counter-Plaintiff Kevin Shields's ("Shields") Motion for Summary Judgment on the Counterclaims. For the following reasons, the Court grants Shields's motion for summary judgment.

BACKGROUND

I. Northern District of Illinois Local Rule 56.1

When determining summary judgment motions, the Court derives the background facts from the parties' Local Rule 56.1 statements. Specifically, Local Rule 56.1 assists the Court by "organizing the evidence, identifying undisputed facts, and demonstrating precisely how each side propose[s] to prove a disputed fact with admissible evidence." Bordelon v. Chicago Sch. Reform Bd. of Trs., 233 F.3d 524, 527 (7th Cir. 2000). Local Rule 56.1(a)(3) requires the moving party to provide "a statement of material facts as to which the moving party contends there is no genuine issue." Cracco v. Vitran Exp., Inc., 559 F.3d 625, 632 (7th Cir. 2009). "The opposing party is required to file '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.'" Id. (citing N.D. Ill. R. 56.1(b)(3)(B)). In addition, Local Rule 56.1(b)(3)(C) requires the nonmoving party to present a separate statement of additional facts that require the denial of summary judgment. See Ciomber v. Cooperative Plus, Inc., 527 F.3d 635, 643-44 (7th Cir. 2008). Pursuant to the Local Rules, the Court will not consider any additional facts proposed in the nonmoving party's Local Rule 56.1(b)(3)(B) Response, but instead must rely on the non-movant's Local Rule 56.1(b)(3)(C) Statement of Additional Facts when making factual determinations. See id. at 643; Cichon v. Exelon Generation Co., L.L.C., 401 F.3d 803, 809 (7th Cir. 2005) ("Local Rule 56.1 requires specifically that a litigant seeking to oppose a motion for summary judgment file a response that contains a separate 'statement . of any additional facts that require the denial of summary judgment.'").

Moreover, the purpose of Rule 56.1 statements is to identify the relevant evidence supporting the material facts, not to make factual or legal arguments, see Cady v. Sheahan, 467 F.3d 1057, 1060 (7th Cir. 2006), and thus the Court will not address the parties' arguments made in their Rule 56.1 statements and responses. Also, the requirements for responses under Local Rule 56.1 are "not satisfied by evasive denials that do not fairly meet the substance of the material facts asserted." Bordelon, 233 F.3d at 528. Further, the Court may disregard statements and responses that do not properly cite to the record. See Cichon, 401 F.3d at 809-10. Finally, "hearsay is inadmissible in summary judgment proceedings to the same extent that it is inadmissible in a trial." Eisenstadt v. Centel Corp., 113 F.3d 738, 742 (7th Cir. 1997). With these standards in mind, the Court turns to the relevant facts of the case.

II. Relevant Facts

Shields is a citizen of the United States and of California. (R. 188-1, Counter-Pl.'s Rule 56.1 Statement of Undisputed Facts, ¶ 1.) Plaintiff/Counter-Defendant Bret A. Broaddus ("Broaddus") is a citizen of Illinois. Id. at ¶ 2. Will Partners, LLC ("Will Partners") was organized in 1998 for the purposes of acquiring and improving real property in Monee, Illinois. Id. at ¶ 3. The First Amended and Restated Limited Liability Company Agreement of Will Partners, LLC dated April 6, 2000 (the "LLC Agreement") controls the relationships of its members, including Shields and Broaddus. Id. at ¶ 6. The LLC Agreement contains a prevailing party fee-shifting provision which provides:

Attorneys Fees. In any action or proceeding between or among the Members arising out of this Agreement, the unsuccessful member shall pay to the prevailing Member all costs and expenses, including, without limitation, reasonable attorneys fees incurred by the prevailing Member in such action or proceeding whether or not such action or proceeding is prosecuted to judgment.

Id. at ¶ 7, Ex. B, LLC Agreement at § 13.12.

On or about November 2, 2000, Broaddus entered into an agreement with Shields and Don Pescara ("Pescara") (the "November 2000 Agreement"). Id. at ¶ 8. Pursuant to the November 2000 Agreement, Broaddus acquired (i) a 10% membership interest in Will Partners, and (ii) a membership participation in Will Partners' distributions. Id. at ¶ 10. The November 2000 Agreement also contains a prevailing party fee-shifting provision which provides:

Should it be necessary for any party to this Agreement to initiate legal proceedings to adjudicate any issues arising hereunder or under any document executed pursuant hereto, the prevailing party in such legal proceedings shall be entitled to reimbursement of such party's attorneys' fees, costs, expenses and disbursements (including the fees and expenses of expert witnesses) reasonably incurred or made in bringing such proceedings.

Id. at ¶ 11, Ex. C, November 2000 Agreement at ¶ 7. Broaddus attached the November 2000 Agreement as Exhibit A to his complaint against Shields and alleged in the complaint that Shields breached a fiduciary duty to another member through an alleged misrepresentation in connection with the purchase by Shields of Broaddus's interest in Will Partners at an allegedly reduced purchase price in March 2003. Id. at ¶ 9.

In March 2003, Broaddus and Shields agreed that Shields would purchase Broaddus's membership interest and participation interest in Will Partners from Broaddus for a purchase price of $600,000. Id. at ΒΆ 12. Between March 26 and 30, 2003, Broaddus executed two assignments in connection with Shields's purchase of his interests: (i) a document dated March 31, 2003 that assigned his membership interest to Shields, and (ii) a document dated March 31, 2003 that assigned his ...


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