Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Lyon Financial Services, Inc. D/B/A Us Bancorp Business Equipment v. Jude's Medical Center

December 5, 2011


The opinion of the court was delivered by: Matthew F. Kennelly, District Judge:


Lyon Financial Services, Inc., d/b/a US Bancorp Business Equipment Finance Group and U.S. Bancorp Manifest Funding Services (Lyon) has sued Jude's Medical Center, Ltd., d/b/a Laser & Cosmetic Dermatology S.C. (Jude's) and Jawdat Abboud. Lyon claims that Jude's breached two contracts on which Abboud served as guarantor. Jude's is currently in bankruptcy, so Lyon is currently proceeding against Abboud on his guaranty. Lyon has moved for summary judgment against Abboud. For the reasons stated below, the Court grants the motion in part and denies it in part.


The Court takes the following facts from the parties' memoranda of law and statements of uncontested facts. On a motion for summary judgment, the Court construes all facts favorably to the nonmoving party and makes reasonable inferences in that party's favor. Eaton v. Ind. Dep't of Corr., 657 F.3d 551, 552 (7th Cir. 2011).

Abboud, a medical doctor, served as CEO of Jude's. On September 7, 2007, he authorized Jude's to lease two "VelaShape" machines, manufactured by Syneron Inc., with financing provided by Lyon. Abboud agreed to guaranty Jude's obligations under the lease. The lease agreement required Jude's to make three monthly payments of $99.00 and sixty monthly payments of $4,594.82 to Lyon, as well as applicable taxes.

On September 12, 2008, Abboud authorized Jude's to lease an "Accent" machine, manufactured by Alma Lasers, Inc., with financing provided by Compass Funding Group. Abboud agreed to guarantee Jude's obligations under this lease as well. The lease agreement required Jude's to make sixty monthly payments of $2,226.21, as well as applicable taxes. On October 8, 2008, Compass assigned all of its right, title and interest in both the lease agreement and the guaranty to Lyon.

Jude's made a series of payments on both leases, but at some point it stopped paying. Lyon claims that payments ceased under the 2007 lease in June 2010 and under the 2008 lease in August 2010. Abboud admits that Jude's stopped paying at some point, but he disputes both the date of default and the remaining balance. Lyon repossessed the VelaShape machines and claims that it sold them for net proceeds of $2,500 in December 2010. It also repossessed the Accent machine, which it claims that it sold for net proceeds of $10,600 in November 2010. Abboud appears to dispute that there is sufficient evidence of whether the sales occurred at all, and he disputes that Lyon conducted them in a commercially reasonable manner.

On December 12, 2010, Jude's filed a bankruptcy petition under Chapter 11, and as a result the Court stayed further proceedings against Jude's. Abboud filed a Chapter 13 bankruptcy petition on February 4, 2011. The Court then dismissed this case without prejudice on February 8, 2011, to await the termination of bankruptcy proceedings. Abboud's Chapter 13 case was later dismissed without prejudice for failing to meet statutory filling requirements, and the Court granted Lyon's motion to reopen the case against Abboud on June 23, 2011. About a month later, Lyon moved for summary judgment.

Abboud later filed a motion to add the affirmative defense that Lyon's sale of the equipment was not commercially reasonable. The Court directed Lyon to file a response and said that it would consider the motion along with the motion for summary judgment.


Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). In other words, a court may grant summary judgment "where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).

Abboud does not dispute that he agreed to serve as guarantor for Jude's, that Jude's missed a number of payments, or that he is therefore obligated to pay some amount of money to Lyon. He argues instead that summary judgment is improper at this point because issues of fact remain regarding the amount that he owes.

A. Sufficiency of evidence of amounts owed

Lyon bases its figures on an affidavit from Philip McGuigan, the "litigation supervisor" for U.S. Bancorp Equipment Finance and an authorized agent of Lyon. McGuigan states that he is the custodian of records relating to all contracts relevant to this case, and that he "ha[s] either personal knowledge of all events recorded within the records of Lyon regarding Jude's Medical Center, Ltd. and Abboud, or [he is] qualified and authorized to testify about the methods and processes used by Lyon to collect and record information and data . . . ." McGuigan Aff. ¶ 6. McGuigan sets out in his affidavit amounts drawn from Lyon's business records, which he adds to reach the total he claims Jude's (and therefore Abboud) owes under each lease.

McGuigan's calculations for the 2007 lease are:

Past Due/Billed Payments (06/30/10 - $14,638.11 08/30/10) 9/30/10 payment $4,879.37 Payments not invoiced, discounted at 6% $139,794.93 Total Principal Balance: $159,312.41 Less credit for sold equipment ($2,500.00) Late charges $2,927.64 Residual value $23,212.98 Prejudgment interest on principal balance $2,898.18 from date of acceleration (09/30/10) to date of equipment sale (12/22/10), totaling 83 days at $34.92 per day Prejudgment interest on remaining $7,148.93 principal balance (12/23/10 ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.