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Ronald McDonald House Charities of Chicagoland and Northwest Indiana, Inc. v. Winning Charities Illinois, LLC

United States District Court, N.D. Illinois, Eastern Division

January 30, 2015

RONALD MCDONALD HOUSE CHARITIES OF CHICAGOLAND AND NORTHWEST INDIANA, INC., Plaintiff,
v.
WINNING CHARITIES ILLINOIS, LLC, et al., Defendants. WINNING CHARITIES ILLINOIS, LLC, Counter-Plaintiff,
v.
RONALD MCDONALD HOUSE CHARITIES OF CHICAGOLAND AND NORTHWEST INDIANA, INC., Counter-Defendant.

MEMORANDUM OPINION AND ORDER

MICHAEL T. MASON, Magistrate Judge.

Before the Court are the parties' cross motions for summary judgment. Plaintiff seeks judgment as to Count I (breach of contract) and Count II (seeking specific performance) of its complaint. Defendant also seeks summary judgment as to Count I of plaintiff's complaint, in addition to Count III (fraudulent misrepresentation) and Count VI (promissory fraud). For the reasons set forth below, both motions are denied.

I. Background

The following facts are taken from the parties' Local Rule 56.1 statements, the responses thereto, and the supporting evidentiary materials. The facts are undisputed unless otherwise noted.

Ronald McDonald House Charities ("RMHC") is a non-profit corporation that provides services for families of sick children. In August 2011, and later again in February 2012, RMHC entered into a Raffle Consultancy Agreement and a Raffle Indemnification Agreement (the "previous agreements") with certain Winning Charities entities ("WCI") whereby WCI would create and run a series of media intense charity raffles on behalf of RMHC. The first and only raffle conducted by the parties incurred a net investment loss of $2, 839, 376.92. At some point thereafter, the parties had a dispute as to their obligations and duties under the previous agreements.[1] On July 19, 2012, RMHC initiated arbitration against WCI before the American Arbitration Association pursuant to the previous agreements, asserting claims for fraud and other claims, and seeking $2, 800, 000 in damages.

On November 20, 2012, the parties met in Rosemont, Illinois to discuss settlement of their dispute. Present at the settlement meeting for RMHC were CEO Doug Porter, general counsel Kathleen Smith, and outside counsel Robert Lang. Present for WCI were principal William Bayles, attorney Greg Hague, and outside counsel Scott Levin. Though the parties dispute whether Hague was present as an attorney for WCI or simply as a mediator, they agree that Hague helped facilitate negotiations. The meeting lasted two to three hours. At the conclusion of the meeting, the parties reached a "settlement in principal."

The day after the meeting, plaintiff's counsel Robert Lang sent an e-mail to Levin, with a copy to Hague, Porter, and Smith, titled "Settlement in Principle." It reads:

Scott,

This is to document our clients' agreement in principle:

1. Total payment by your clients to RMHC: $1, 100, 000.
2. Payout:
a. $50, 000 at the time of execution of the release and settlement agreement ("SA"), which must occur on or before January 4, 2013.
b. $25, 000 on or before February ...

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