United States District Court, N.D. Illinois, Eastern Division
MOMO ENTERPRISES, LLC, a dissolved Limited Liability Company, ANASTACIO GONZALEZ, PLAZA LOUNGE, LLC, a dissolved Limited Liability Company, Plaintiffs,
BANCO POPULAR OF NORTH AMERICA, POPULAR INC, POPULAR COMMUNITY BANK, CHUHAK & TECSON, PEAK PROPERTIES, DAVID J. AXELROD AND ASSOCIATES, THOMAS H. HORN, TERENCE G. TIU, DANIEL J. FUMAGALLI, JOSHUA S. HYMAN, KARA ALLEN, MICHAEL L. ZUCKER, ROBERT S. STONE, DAVID BALL, JENNIFER CIRAR, DIVISON POINT TERRACES CONDO ASSOCIATION, DPT CONDO PRESIDENT, DPT CONDO SECRETARY, KOVITZ SHIFRIN & NESBIT, JOHN LEYDON, KATE LEYDON, 1700 W. DIVISION LLC, JEFFREY E. ROCHMAN, DAVID J. AXELROD, CHICAGO TITLE & TRUST CO, NORTHERN TITLE CO, UNNAMED CO-CONSPIRATORS, et al., Defendants.
MEMORANDUM OPINION AND ORDER
JOHNSON COLEMAN, UNITED STATES DISTRICT JUDGE
Enterprises, LLC, a dissolved LLC (“Momo”),
Anastacio Gonzalez (“Gonzalez”), and Plaza
Lounge, LLC, a dissolved LLC (“Plaza Lounge”)
(collectively, “Plaintiffs”) brought their 179
page, 34-count second amended complaint (the
“complaint”), (Dkt. 20), against a plethora of
parties. The defendants filed individual motions to dismiss,
in addition to a joint memorandum in support of dismissal
(Dkt. 48). After reviewing the complaint and the various
motions and memoranda, and hearing oral argument, this Court
grants the following motions:
• North American Title's motion to dismiss 
• Popular, Inc.'s (“Popular, Inc.”)
motion to dismiss 
• 1700 W. Division LLC's motion to dismiss 
• John Leydon's (“John Leydon”) motion
to dismiss 
• Banco Popular of North America (“Banco
Popular”), Popular Community Bank (“PCB”),
Thomas H. Horn (“Horn”), Chuhak & Tecson,
P.C. (“Chuhak & Tecson”), Terrence G. Tiu
(“Tiu”), Daniel J. Fumagalli
(“Fumagalli”), Joshua S. Hyman
(“Hyman”), and Kara Allen's
(“Allen”) (collectively, the “Bank
Group”) motion to dismiss 
• Kate Leydon's (“Kate Leydon”) motion
to dismiss 
• Robert Stone (“Stone”), David Ball
(“Ball”), Jennifer Cirar (“Cirar”),
DPT Condo Association (“DPT Condo Association”),
DPT Condo President (“DPT President”), and DPT
Condo Secretary's (“DPT Secretary”)
(collectively, the “DPT Defendants”) motion to
• Michael Zucker (“Zucker”) and Peak
Properties, LLC (“Peak Properties”)
(collectively, “Peak Defendants”) motion to
• Kovitz Shifrin & Nesbit, P.C.'s
(“KSN”) motion to dismiss 
• David J. Axelrod and Associates (“Axelrod and
Associates”) and David J. Axelrod's (“Mr.
Axelrod”) (collectively, the “Axelrod
Defendants”) motion to dismiss 
• Chicago Title Trust & Co. (“Chicago
Title”) motion to dismiss 
Court outlines the grounds for this ruling and the resulting
relief in the discussion section below.
is the former owner of a commercial condominium and a
residential condominium in a building located at 1700 W.
Division Street in Chicago, IL. (Dkt. 20 ¶ 20).
Plaintiffs brought this suit, in large part, to challenge the
sales and foreclosures of the residential and commercial
condominiums and the Plaintiffs' subsequent evictions
from those properties. They allege, as described below, that
the sales and foreclosures were the product of a large
conspiracy made up of neighbors, banks, attorneys, and other
parties, which was perpetrated through multiple lawsuits,
purported fraudulent transfers, and a wide variety of torts.
This Court was called upon to decipher the lengthy,
complicated, convoluted, and often inconsistent complaint, in
addition to the multiple motions and briefs filed in
The subject properties
building located at 1700 W. Division is comprised of three
residential condominiums, a commercial condominium, and a
rooftop parcel. By the end of 2005, Ball, Cirar, and Stone
owned the residential condominiums on the second and third
floors of the building. (Dkt. 20 ¶¶ 60-62). On
September 28, 2006, Gonzalez purchased the residential
condominium on the fourth floor and became the owner of the
rooftop parcel. (Id. ¶ 64). Stone, Ball, and
Cirar, as part of their purchase contracts, agreed that the
rooftop parcel and the commercial condominium would exist
separate and apart from the residential condominium
properties and the DPT Condo Association, and that they would
not directly or indirectly contest the application for or
possession of a liquor license by the occupants of the
commercial condominium. (Id. ¶ 62).
in April, 2006, Stone, Ball, and Cirar induced Gonzalez to
pay for common bills related to the building located at 1700
W. Division Street. These bills included maintenance, repair
and improvement, electric, and water bills. (Id.
March 22, 2010, Ball and Stone formed the DPT Condo
Association. (Id. ¶ 108). The DPT Condo
Association allegedly refused to service or provide
maintenance for common element areas on the fourth floor of
the building, change hallway lights, paint, or clean the
front and rear stairways. (Id. ¶ 142).
January 25, 2007, Gonzalez, through Momo, purchased the
commercial condominium space located on the first floor of
the 1700 W. Division building. (Id. ¶¶ 20,
21, 65). In April, 2007, Gonzalez, through Plaza Lounge,
applied for the required licenses to open his restaurant in
the commercial condominium. (Id. ¶ 68).
Gonzalez launched his restaurant in the commercial
condominium in December, 2008. (Id. ¶ 73).
Thereafter, a series of lawsuits were filed and actions were
taken against the Plaintiffs.
The first state lawsuit - Stone, Ball, and Cirar v. Gonzalez
and Plaza Lounge
March 10, 2009, Stone filed a state court complaint against
Gonzalez and Plaza Lounge alleging a noise nuisance (the
“first suit”). Stone requested an order
preventing Plaza Lounge from playing music in the restaurant
after 9:00 PM. (Id. ¶¶ 77, 78). On July
22, 2009, Ball and Cirar joined the suit as plaintiffs.
(Id. ¶ 88). Gonzalez alleges that Ball and
Cirar joined the suit in an effort to remove Plaza Lounge
from the commercial condominium. (Id. ¶ 90).
Removing Plaza Lounge would have helped Ball and Cirar sell
their residential condominium more quickly. (Id.
¶ 90). On September 11, 2009, Gonzalez, Stone, Ball, and
Cirar participated in mediation. (Id. ¶ 93).
The second state lawsuit - DPT Condo Association v.
3, 2010, the DPT Condo Association filed a complaint in state
court against Gonzalez alleging that Gonzalez owed the DPT
Condo Association $6, 401.04 (the “second suit”).
(Id. ¶ 110). On June 4, 2010, the DPT Condo
Association created a “30 Day Notice and Demand
Letter” which claimed that Gonzalez owed the DPT Condo
Association $6, 401.04 as of April 2, 2010. (Id.
¶¶ 111, 112). On January 6, 2011, Ball filed an
amended complaint which added a count demanding possession of
the residential condominium pursuant to the Forcible Entry
and Detainer Act and alleged that Gonzalez owed the DPT Condo
Association $9, 491.54. (Id. ¶ 114). On
February 1, 2011, KSN filed an appearance on behalf of the
DPT Condo Association. (Id. ¶ 116). The case
was transferred to the “forcible call” on March
9, 2011. (Id. ¶ 118). On June 28, 2011, KSN
filed a second amended complaint on behalf of the DPT Condo
Association which alleged that Gonzalez owed it $11, 735.
(Id. ¶ 119). Trial began on September 21, 2011.
(Id. ¶ 123). A judgment of $5, 650 was entered
in favor of the DPT Condo Association and against Gonzalez.
(Id. ¶ 125). The DPT Condo Association also
obtained an order for possession of Gonzalez's
residential unit. (Id. ¶ 125). On December 8,
2011, Gonzalez was forced to leave the residential
condominium. (Id. ¶ 213).
The third state lawsuit - The DPT Condo Association v.
Gonzalez and Momo
1, 2010, the DPT Condo Association filed a state court
complaint against Gonzalez and Momo alleging that they owed the
DPT Condo Association $2, 750 in insurance costs for the
commercial condominium spanning from September 2006 to April
2010 (the “third suit”). (Id. ¶
128). The DPT Condo Association filed a motion for default
against Gonzalez and Momo and scheduled the motion for
presentment on September 14, 2010. (Id. ¶ 130).
Gonzalez did not attend the hearing on behalf of Plaza Lounge
as he was scheduled to be in two other courtrooms at the same
date and time. (Id. ¶ 131). The state court
entered a default judgment against Gonzalez and Momo for $2,
750. (Id. ¶ 132)). On November 12, 2010, the
default judgment was vacated and the suit was dismissed.
(Id. ¶ 133).
The fourth state lawsuit - Irizarry v. Gonzalez
September 3, 2009, Axelrod filed a breach of contract and
account stated suit on behalf of his client, Irizarry, and
against Gonzalez (the “Axelrod suit”).
(Id. ¶ 290). The Axelrod suit appears to
pertain to furniture Irizarry and his company, R&M Booth,
provided to Gonzalez and Plaza Lounge for use in the
commercial condominium. (Id. ¶ 292). Plaintiffs
now allege that Axelrod misrepresented, concealed, and
suppressed material information at various hearings, although
Plaintiffs do not identify what this information was.
(Id. ¶¶ 293a-g).
the course of this contested litigation, Axelrod, on behalf
of Irizarry, made several representations concerning Banco
Popular, including the following: that Irizarry
“removed certain business property at directions of the
attorney for Banco Popular, ” (Id. ¶
271), and that “[i]n late March 2012, [Irizarry] was
called by someone who said he was connected with Banco
Popular, a bank foreclosing on 1700 W. Division . . .”
and that the Banco Popular agent told Irizarry he had one
hour to remove his furniture from the commercial condominium.
(Id. ¶ 272).
meeting with Gonzalez on September 11, 2013, Irizarry signed
two affidavits. The first indicated that he voluntarily
agreed to vacate all judgments and judgment orders entered
against Gonzalez in the Axelrod suit, (Id. ¶
276), and the second indicated that in October, 2011, Stone
and Tiu, a Chuhak & Tecson attorney, had reached out to
him about the proceedings to remove Plaza Lounge from the
commercial condominium. (Id. ¶¶ 277d, e).
The second affidavit also discussed communications between
John Leydon and Irizarry in February and March of 2012 about
collecting property from the commercial condominium.
(Id. ¶¶ 277f, g). On September 23, 2013,
Irizarry appeared in court and dismissed the Axelrod suit and
vacated all judgments and judgment orders against Gonzalez.
(Id. ¶ 278).
Purchase and sale of the commercial condominium and the
alleged bid-rigging scheme
the proceedings in the first suit, Stone allegedly told
Gonzalez that he was working with Horn, an Assistant Vice
President and Loan Workout Officer at Banco Popular, to buy
the commercial condominium. (Id. ¶ 99a). On
January 20, 2010, Chuhak & Tecson filed a foreclosure
action on behalf of Banco Popular against the commercial
condominium, naming Gonzalez and Momo as the defendants,
after Gonzalez and Momo fell behind on the mortgage payments
(the “mortgage foreclosure
action”).,  (Id. ¶ 145). In its
complaint, Banco Popular used the wrong PIN number to
identify the commercial condominium,  used the incorrect legal
description of the commercial condominium, failed to provide
a unit number for the commercial condominium, and excluded
the commercial parking lot from the legal description of the
commercial condominium. (Id. ¶ 146). Gonzalez
filed an appearance in the foreclosure action and filed a
“tentative Answer” on May 11, 2010. (Id.
¶ 150). On July 9, 2010, Banco Popular filed a motion
for default and entry of judgment of foreclosure and sale,
which it scheduled for presentment on July 21, 2010; the
motion represented that Gonzalez and Momo had been served but
that they had not filed a responsive pleading. (Id.
¶ 152). In support of the July 9 motion for default,
Horn submitted an affidavit that alleged that Banco Popular
had in its possession a promissory note from Momo dated
August 1, 2006, for $13, 287, 000 and a promissory note from
Momo dated January 27, 2007, for $680, 000. (Id.
¶ 154). On July 21, 2010, the Cook County Circuit Court
entered an order of default and a default judgment of
foreclosure and sale in the amount of $680, 000 against
Gonzalez and Momo. (Id. ¶ 155). A judicial sale
of the commercial condominium was scheduled for August 30,
2010. (Id. ¶ 156).
certificate of publication and notice of sale at public
auction for the commercial condominium, Banco Popular used
the 044 PIN instead of the 071 PIN, used the incorrect legal
description, failed to use the unit number, and failed to
list substantial improvements to the commercial condominium.
(Id. ¶¶ 158a-e). Banco Popular also
refused to allow inspection of the commercial condominium
prior to the judicial sale. (Id. ¶ 158f).
Plaintiffs allege that these omissions were meant to suppress
competitive bidding on the commercial condominium.
(Id. ¶¶ 158, 162).
August 30, 2010, Banco Popular successfully bid on the
commercial condominium and was granted a certificate of sale.
(Id. ¶ 163). Banco Popular purchased the
commercial condominium for $441, 600, where the estimated
fair market value of the property was $2, 000, 000.
(Id. ¶ 163). Banco Popular filed a motion to
appoint Zucker as the receiver for the commercial
condominium, which was rescheduled for presentment on
September 14, 2010, (Id. ¶ 165a), which date
coincided with a motion in the first suit and a motion for
default in the third suit. (Id. ¶¶ 165b,
c). During the receivership hearing, Banco Popular
represented to the court that Gonzalez and Momo owed the City
of Chicago $17, 000 for water bills, which Plaintiffs claim
was a fraudulent representation. (Id. ¶ 166).
Zucker was appointed as receiver for the commercial
condominium. (Id. ¶ 169).
December 9, 2010, Banco Popular presented a motion for order
approving report of sale and distribution and for an entry of
deficiency judgment. (Id. ¶ 173) Banco Popular
obtained an order approving the report of sale and
distribution. (Id. ¶ 174). On December 10,
2010, Banco Popular was granted the judicial sale deed for
the commercial condominium. (Id. ¶ 175). The
sale deed, however, was executed for the 044 PIN.
(Id. ¶ 176). Banco Popular allegedly crossed
out the 044 PIN and added the 071 PIN on the judicial sale
deed sometime between December 10 and December 15, 2010.
(Id. ¶ 177).
January 6, 2011, Zucker, on behalf of Banco Popular, served
Plaza Lounge with a landlord's five-day notice pursuant
to the terms of the commercial condominium lease.
(Id. ¶¶ 180, 181). On January 10, 2011,
Plaza Lounge tendered, and Banco Popular accepted,
outstanding rent it owed. (Id. ¶ 183). On
January 31, 2011, Banco Popular filed a petition for an order
of possession of the commercial condominium against Plaza
Lounge. (Id. ¶ 186). On April 6, 2011, Gonzalez
filed an opposition to this motion, which detailed the
alleged “unlawful acts” being committed in
furtherance of the conspiracy to defraud Gonzalez of the
commercial condominium. (Id. ¶ 234). On June
24, 2011, Banco Popular pursued and obtained a deficiency
judgment against Gonzalez and Momo for the full amount of the
mortgage debt and a citation to discover assets was issued.
(Id. ¶ 236). Despite making monthly lease
payments, Plaza Lounge was evicted from the commercial
condominium on September 29, 2011. (Id. ¶ 187).
Plaintiffs allege that the eviction violated several terms of
the commercial condominium lease agreement. (Id.
October 20, 2011, Banco Popular sold the commercial
condominium to John Leydon via a special warranty deed,
despite the Plaintiffs' lien on the property and the
various petitions to vacate the foreclosure which this Court
describes in the next section. (Id. ¶¶
196, 196a). Chuhak & Tecson prepared and Horn signed the
special warranty deed which included the correct 071 PIN and
the commercial parking parcel in the legal description.
(Id. ¶ 243). On October 25, 2011, John Leydon
obtained a mortgage to purchase the commercial condominium;
this transaction was completed at the Chicago Title offices.
(Id. ¶ 208). Plaintiffs allege that John Leydon
made several false representations in his pursuit of
acquiring the mortgage. (Id. ¶¶ 209a-c).
November 21, 2011, Gonzalez filed an emergency motion for
temporary restraining order (“TRO”), presumably
in the mortgage foreclosure action, requesting that John
Leydon be prohibited from removing certain property from and
leasing the commercial condominium. (Id. ¶
210). The TRO also set a date for a hearing on damages for
alleged conversion, theft, and assault and battery,
allegations which this Court details below. (Id.
¶ 210). Plaintiffs do not identify the judge that heard
the motion. Chuhak & Tecson represented John Leydon in
this action. (Id. ¶ 211).
December 13, 2011, Judge Alexander White approved a citation
to discover assets against John Leydon. (Id. ¶
218). The citation prohibited John Leydon from transferring
any of his assets. (Id. ¶ 219). One day later,
John Leydon obtained a second mortgage for the commercial
condominium from North American Title. (Id. ¶
225). This mortgage was obtained while Plaintiffs were
challenging the judgment in favor of Banco Popular, and while
the $1, 500, 000 lien against the commercial condominium was
still active. (Id. ¶ 226). On the same day,
John Leydon filed a quitclaim deed and corrected the
previously incorrect legal description of the commercial
condominium. (Id. ¶ 228). On December 20, 2011,
John Leydon transferred the commercial condominium to
defendant 1700 W. Division LLC. (Id. ¶ 220).
Challenge of the commercial condominium foreclosure
October 14, 2011, Gonzalez, Momo, and Plaza Lounge filed a
lien against the commercial condominium for the $1, 500, 000
liquidated damages pursuant to the eviction terms in the
commercial condominium lease, (Id. ¶ 192), and
a petition pursuant to 735 ILCS 5/2-1401(f) in the mortgage
foreclosure action. (Id. ¶ 193). The petition
requested that the circuit court vacate and void all of the
judgments and orders in the mortgage foreclosure action.
(Id. ¶ 193). On October 19, 2011, the trial
court ordered Banco Popular to allow Gonzalez to access the
commercial condominium in order to conduct an inventory of
the remaining personal property and to schedule time for
Gonzalez to remove such property. (Id. ¶ 195).
On November 4, 2011, Banco Popular filed a sanctions motion
against Gonzalez, who was pro se at the time, which alleged
that Gonzalez had filed false verified pleadings.
(Id. ¶ 244). The motion for sanctions requested
that Gonzalez, Plaza Lounge, and Momo be held in civil
contempt, and that they be restricted from filing any motions
for 180 days without leave of court. (Id. ¶
Popular began to include Axelrod on the service list for all
motions starting in April, 2012. (Id. ¶ 262e).
It should be noted that, based on this Court's review of
the record, it does not appear that Axelrod represented any
of the parties involved in the mortgage foreclosure action.
If in fact he did not represent any of the parties, there
would be no reason for him to be ...