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Lyon Financial Services, Inc. v. AKB Enterprises

October 28, 2010

LYON FINANCIAL SERVICES, INC., PLAINTIFF,
v.
AKB ENTERPRISES, INC., AND KIM BRANCAMP, DEFENDANTS.



The opinion of the court was delivered by: Samuel Der-yeghiayan, District Judge

MEMORANDUM OPINION

This matter is before the court on Plaintiff Lyon Financial Services, Inc. d/b/a US Bancorp Business Equipment Finance Group's (Lyon) motion for summary judgment. For the reasons stated below, we grant the motion for summary judgment.

BACKGROUND

Lyon alleges that in December 2007, it entered into two lease agreements (Lease Agreements) with Defendant AKB Enterprises, Inc. d/b/a Sign A Rama (AKB). The Lease Agreements were allegedly designated as Lease Agreement 500-0119550-000 (119 Agreement) and Lease Agreement 500-0131732-000 (131 Agreement). Under the Lease Agreements, Lyon allegedly leased certain equipment (Equipment) to AKB. Lyon contends that Defendant Kim Brancamp (Brancamp) also signed guaranties (Guaranties) and personally guaranteed all of AKB's obligations. According to Lyon, AKB made the first fifteen of the sixty monthly payments owed to Lyon under the 119 Agreement, but failed to make the payment due on December 16, 2008, or any payments thereafter. In regard to the 131 Agreement, AKB allegedly made the first sixteen of the sixty monthly payments owed to Lyon under the 131 Agreement, but failed to make the payment due on June 5, 2009, or any payments thereafter.

Lyon includes in its complaint a breach of contract claim brought against AKB premised on the 119 Agreement (Count I), a breach of guaranty claim brought against Brancamp premised on the 119 Agreement (Count II), a breach of contract claim brought against AKB premised on the 131 Agreement (Count III), a breach of guaranty claim brought against Brancamp premised on the 131 Agreement (Count IV), and a detinue claim brought against AKB and Brancamp (Count V). Defendants brought counterclaims against Lyon, and Lyon moved to dismiss all counterclaims. On May 17, 2010, the court granted the motion to dismiss the counterclaims. Lyon now moves for summary judgment on its claims.

LEGAL STANDARD

Summary judgment is appropriate when the record, viewed in the light most favorable to the non-moving party, reveals that there is no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Smith v. Hope School, 560 F.3d 694, 699 (7th Cir. 2009). In seeking a grant of summary judgment, the moving party must identify "those portions of 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986)(quoting Fed. R. Civ. P. 56(c)). This initial burden may be satisfied by presenting specific evidence on a particular issue or by pointing out "an absence of evidence to support the non-moving party's case." Id. at 325. Once the movant has met this burden, the non-moving party cannot simply rest on the allegations in the pleadings, but, "by affidavits or as otherwise provided for in [Rule 56], must set forth specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). A "genuine issue" in the context of a motion for summary judgment is not simply a "metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986). Rather, a genuine issue of material fact exists when "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); Insolia v. Philip Morris, Inc., 216 F.3d 596, 599 (7th Cir. 2000). In ruling on a motion for summary judgment, the court must consider the record as a whole, in a light most favorable to the non-moving party, and draw all reasonable inferences in favor of the non-moving party. Anderson, 477 U.S. at 255; Bay v. Cassens Transport Co., 212 F.3d 969, 972 (7th Cir. 2000).

DISCUSSION

I. Local Rule 56.1

Lyon filed a statement of material facts with its motion for summary judgment in accordance with Local Rule 56.1. Defendants have filed a response to Lyon's statement of material facts, but the document fails to comply with Local Rule 56.1. In the response, Defendants fail to respond to any facts and instead provide responses only to exhibits. LR 56.1; see also Judson Atkinson Candies, Inc. v. LatiniHohberger Dhimantec, 529 F.3d 371, 382 n.2 (7th Cir. 2008)(stating that "a district court has broad discretion to require strict compliance with Local Rule 56.1"). Nor do Defendants provide in their response any citations to the record to support any denial of facts, as is required in Local Rule 56.1. LR 56.1(b)(3)(B). In addition, Defendants fail to even admit or deny the information contained in exhibits. While a response that a party lacks sufficient information to form a response may be appropriate for an answer to a complaint, it is not a proper response to a statement of material facts under Local Rule 56.1. LR 56.1. An opposing party is required to either admit or deny facts and, if denying facts, the response must include an appropriate citation to the record to support the denial. LR 56.1; Dent v. Bestfoods, 2003 WL 22025008, at *1 n.1 (N.D. Ill. 2003); Jankovich v. Exelon Corp., 2003 WL 260714, at *5 (N.D. Ill. 2003)(indicating that evasive denials that do not directly oppose an assertion are improper, and thus the contested fact is deemed to be undisputed pursuant to Local Rule 56.1). Based on Defendants' failure to properly respond to Lyon's statement of material facts, all the facts contained in Lyon's statement of material facts are deemed to be undisputed pursuant to Local Rule 56.1.

II. Choice of Law

Lyon contends that Minnesota law applies in this case. Defendants contend that although Minnesota law applies to the claims relating to the agreements at issue, Illinois law applies to the detinue claim. However, Lyon and Defendants agree that, in regard to the claims premised on a breach of contract cause of action, Illinois and Minnesota law is substantially the same.

The Lease Agreements include provisions that indicate that Minnesota law applies to claims relating to the terms of the contracts. (119 Agr. Par. 15); (119 Guar.); (131 Agr. Par. 15); (131 Guar.). Thus, since this action is based on an alleged breach of the terms of the Lease Agreements, Minnesota law would apply. We agree, however, with the parties that Illinois law and Minnesota law regarding a breach of contract cause of action is substantially the same in all material respects.

In regard to the detinue claims, there are some minor differences between Illinois law and Minnesota law. Illinois has retained a common law detinue claim and Minnesota has replaced a common law detinue claim with a replevin statute. Minn. Stat. § 565.21-29; A & A Credit Co. v. Berquist, 41 N.W.2d 582, 584 (Minn. 1950)(explaining that the common law causes of action in Minnesota law for replevin and detinue "no longer exist in Minnesota" and the Minnesota "code replaced them with the action for claim and delivery of personal property"); Mineika v. Union Nat. Bank of Chicago, 332 N.E.2d 504, 509 (Ill. App. Ct. 1975)(explaining that "[u]nder common law, an action in detinue would lie for the recovery of a chattel or its value if ...


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