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.

Janssen v. BRI Holding, LLC

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

May 15, 2017

ASH JANSSEN, Plaintiff,
BRI HOLDING, LLC, Defendant.


          John Robert Blakey United States District Judge.

         Plaintiff Ash Janssen (“Plaintiff”), a Colorado resident, brings this diversity action against Defendant BRI Holding, LLC (“Defendant”), an Illinois corporation, to collect amounts purportedly owed under a written Promissory Note (the “Note”). Compl. [1]. On January 27, 2017, Plaintiff moved for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c). Pl.'s Mot. J. Plead. [18]. For the reasons explained below, Plaintiff's motion is granted.

         I. Background

         Defendant executed the Note on or about September 30, 2014. Compl. [1] ¶ 8; Ans. [15] ¶ 8.[1] Under its terms, Defendant “unconditionally promises to pay” to the order of Plaintiff a principal amount of $2, 500, 000, plus accrued and unpaid interest at a rate of twenty percent per annum.[2] Compl. [1] Ex. A at 1.

         Beginning in 2015, the Note required Defendant to make payments of accrued and unpaid interest on January 15, April 15, July 15, and October 15 of each calendar year. Id. The entire outstanding principal amount was due on or before the Note's maturity date, which is five years after the acceptance of the Note. Id. Failure to make a timely payment of principal or interest constitutes an “Event of Default, ” which allows Plaintiff to declare “the entire unpaid principal amount of [the] Note together with accrued interest” immediately due and payable. Id. at 2. Moreover, during the continuance of an Event of Default, the Note's interest rate increases to twenty-five percent per annum. Id. at 1.

         Defendant failed to make the required interest payments on January 15, 2015; April 15, 2015; June 15, 2015; October 15, 2015; January 15, 2016; April 15, 2016; and July 15, 2016. Compl. [1] ¶ 13; Ans. [15] ¶ 13. On July 18, 2016, Plaintiff sent Defendant a demand letter notifying it of its failure to pay and declaring the entire outstanding balance immediately due and payable. Compl. [1] ¶ 15; Ans. [15] ¶ 15. Despite the demand letter, Defendant still failed to make its required interest payment on October 15, 2016. Compl. [1] ¶ 15, 17; Ans. [15] ¶ 15, 17. On October 27, 2016, Plaintiff filed suit in this Court. Compl. [1].

         In its Answer to Plaintiff's Complaint, Defendant admits the material facts discussed above, but denies that Plaintiff is entitled to any payments of principal or interest. Ans. [15] 1. Rather, Defendant claims that the Note at issue was, in fact, “part of a larger transaction” in which Defendant acquired a seventy percent interest in Plaintiff's company, AAR Parent, LLC (“AAR”). Id. Defendant alleges that as part of this larger transaction, the parties “contemplated” that Plaintiff would be paid back on the Note “solely from distributions from [Defendant's] equity interest in AAR.” Id. Defendant avers that its interest in AAR-which constitutes its only asset-has since become worthless, leaving Defendant unable to repay the Note. Id. Defendant believes that Plaintiff assumed the risk of such default as part of the overall transaction. Id.

         II. Legal Standard

         Rule 12(c) permits a party to move for judgment solely upon the pleadings. Fed.R.Civ.P. 12(c); Moss v. Martin, 473 F.3d 694, 698 (7th Cir. 2007). A motion for judgment on the pleadings “is designed to provide a means of disposing of cases when the material facts are not in dispute and a judgment on the merits can be achieved by focusing on the content of the pleadings and any facts of which the court may take judicial notice.” Archer Daniels Midland Co. v. Burlington Ins. Co. Grp., No. 10-cv-1533, 2011 WL 1196894, at *2 (N.D. Ill. Mar. 29, 2011) (quoting Cincinnati Ins. Co v. Contemporary Distrib., Inc., 2010 No. 09-cv-2250, 2010 WL 338943, at *2 (N.D. Ill. Jan. 26, 2010)). The pleadings consist of the complaint, the answer, and any written instruments attached as exhibits (here, the Note). Hous. Auth. Risk Retention Grp., Inc. v. Chicago Hous. Auth., 378 F.3d 596, 600 (7th Cir. 2004).

         Generally, the Court reviews Rule 12(c) motions under the same standard as a motion to dismiss under Rule 12(b). N. Indiana Gun & Outdoor Shows, Inc. v. City of S. Bend, 163 F.3d 449, 452 (7th Cir. 1998). However, where, as here, a party seeks to use a Rule 12(c) motion “to dispose of the case on the basis of the underlying substantive merits, ” the appropriate standard “is that applicable to summary judgment, except that the court may consider only the contents of the pleadings.” Alexander v. City of Chi., 994 F.2d 333, 336 (7th Cir. 1993); United States Liab. Ins. Co. v. Sigmatek, Inc., No. 14-cv-1747, 2015 WL 801504, at *4 (N.D. Ill. Feb. 20, 2015). In these cases, the Court must view the facts and all reasonable inferences drawn from those facts in the light most favorable to the non-moving party. P-Americas, LLC v. Cent. States Se. & Sw. Area Pension Fund, No. 13-cv-8808, 2014 WL 3858396, at *3 (N.D. Ill. Aug. 5, 2014). A motion will not be granted unless “no genuine issues of material fact remain to be resolved” and the moving party “is entitled to judgment as a matter of law.” Alexander, 994 F.2d at 336.

         III. Discussion

         A. Article 3 Of The Illinois Commercial Code Applies

         Before reaching the merits of the parties' claims, the Court must first determine the applicable law. The parties agree that Illinois law governs, an understanding buttressed by the language of the Note itself. See Compl. [1] Ex. A at 5 (“THIS NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF ILLINOIS, WITHOUT GIVING EFFECT TO ANY CONFLICT OF LAW PRINCIPLES OF ANY JURISDICTION.”).

         In Illinois, negotiable instruments are governed by Article 3 of the Illinois Commercial Code (the “Code”), 810 ILCS § 5/1-101 et seq. The Code defines a “negotiable instrument” as, inter alia, “an unconditional promise or order to pay a fixed amount of money, with or without interest or other charges described in the promise or order.” Id. § 5/3-104. A promise or order is considered unconditional unless it states: (1) “an express condition to payment”; (2) “that the promise or order is subject to or governed by another writing”; or (3) “that rights or obligations with respect to the promise or order are stated in another writing.” Id. § 5/3-106. A promise or order is not made conditional “because payment is limited to resort to a particular fund or source.” Id.

         In addition to being unconditional, a negotiable instrument also:

(1) is payable to bearer or to order at the time it is issued or first comes into possession of a holder;
(2) is payable on demand or at a definite time; and
(3) does not state any other undertaking or instruction by the person promising or ordering payment to do any act in addition to the payment of money, but the promise or order may contain (i) an undertaking or power to give, maintain, or protect collateral to secure payment, (ii) an authorization or power to the holder to confess judgment or realize on or dispose of collateral, or (iii) ...

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.