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Co v. Torres

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

July 22, 2019

VINCENT CORDERO, Plaintiff,
v.
DAVID TORRES, Defendant. DAVID TORRES, Counter-Plaintiff,
v.
VINCENT CORDERO, Counter-Defendant, and INVIVO MEDIA GROUP, LLC, INVIVO CONCERTS, LLC, Nominal Defendants.

          MEMORANDUM OPINION AND ORDER

          HON. JORGE ALONSO, UNITED STATES DISTRICT JUDGE

         Plaintiff/counter-defendant Vincent Cordero and defendant/counter-plaintiff David Torres are former business partners. Together, they owned several businesses specializing in live music promotion for U.S. Latino markets. In 2017, Cordero and Torres had a dispute over money. Relations soon soured, and this suit followed.

         Before the Court is Cordero's motion to dismiss Torres's amended counterclaims and to strike affirmative defenses pursuant to Federal Rules of Civil Procedure 12(b)(1), 23.1, 12(b)(6), and 12(f). For the reasons set forth below, the motion [45] is granted in part and denied in part. Additionally, Cordero shall file a supplemental statement of federal jurisdiction properly alleging a basis for the Court's jurisdiction by July 31, 2019. Status set for August 1, 2019 at 9:30 a.m.

         BACKGROUND

         Plaintiff/counter-defendant Vincent Cordero brings a one-count complaint against defendant/counter-plaintiff David Torres, alleging a claim of enforcement of guaranty agreement. Cordero resides in Florida, and Torres resides in Illinois. They are each fifty percent members and officers of Invivo Media Group, LLC, Invivo Concerts Chicago, LLC, and Invivo Concerts, LLC (the “Invivo Entities”).

         Cordero alleges that, from February 2017 through May 2017, he loaned the Invivo Entities approximately $920, 000. According to Cordero, Torres promised him that he would repay the loan to Cordero. Cordero points to a Secured Promissory Note (the “Note”), dated May 22, 2017 wherein the Invivo Entities agreed to repay to Cordero the loan by August 1, 2017. (Dkt. 1-1.) Cordero also points to a Guaranty and Security Agreement (the “Guaranty Agreement”), dated May 19, 2017. (Dkt. 1-2.) Despite the promise of repayment, Cordero says that Torres has only made partial payment on the loan. Cordero now seeks to recover the outstanding amount of the loan plus interest, costs, and fees.

         Torres disputes many of these allegations, including whether the Note and the Guaranty Agreement constitute valid agreements. Torres has filed an amended answer, seven counterclaims, and three affirmative defenses. Torres has also added Invivo Media Group, LLC and Invivo Concerts, LLC as nominal defendants. For his counterclaims, Torres alleges: (1) breach of fiduciary duty as to Invivo Media Group, LLC; (2) breach of LLC Operating Agreement as to Invivo Media Group, LLC; (3) tortious interference with prospective business relations as to Invivo Media Group, LLC; (4) accounting as to Invivo Media Group, LLC; (5) breach of fiduciary duty as to Invivo Concerts, LLC; (6) tortious interference with prospective business relations as to Invivo Concerts, LLC; and (7) breach of contract as to David Torres. As for his affirmative defenses, Torres alleges: (1) no meeting of the minds; (2) absence of consideration; and (3) failure to pursue the borrower first.

         Cordero moves to dismiss the counterclaims under Rules 12(b)(1), 23.1, and 12(b)(6). He also moves to strike the affirmative defenses under Rule 12(f). The Court will address each in turn.

         DISCUSSION

         I. Rule 12(b)(1) - Jurisdiction

         A district court's “first duty in every lawsuit” is to establish the existence of subject-matter jurisdiction. McCready v. White, 417 F.3d 700, 702 (7th Cir. 2005); Johnson v. Wattenberger, 361 F.3d 991, 992 (7th Cir. 2004). In every case, a federal court must first assure itself that it has jurisdiction over the claims before it. Scott Air Force Base Prop., LLC v. Cty of St. Clair Ill., 548 F.3d 516, 520 (7th Cir. 2008). “[F]ederal courts are obligated to inquire into the existence of jurisdiction sua sponte.” Evergreen Square of Cudahy v. Wisc. Hous. & Econ. Dev. Auth., 776 F.3d 463, 466 (7th Cir. 2015) (citing Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S. 567, 593 (2004)).

         A. Plaintiff's Complaint

         As an initial matter, the Court notes that Cordero has failed to adequately allege diversity jurisdiction in his complaint.[1] Cordero asserts that the Court has jurisdiction pursuant to 28 U.S.C. § 1332 on the grounds that the amount in controversy exceeds $75, 000.00 and the case is between citizens of different states. Cordero states that he is “a citizen of the United States, who resides in the State of Florida, ” and that Torres “is a citizen of the United States, who resides in the State of Illinois, City of Chicago.” (Dkt. 1, ¶¶ 1-2.) However, citizenship of an individual is determined by domicile, not residence. See Heinen v. Northrop Grumman Corp., 671 F.3d 669, 670 (7th Cir. 2012) (allegation of “residence” is deficient). In light of the jurisdictional deficiencies in Cordero's complaint, Cordero is given leave to file a supplemental statement of federal jurisdiction properly alleging a basis for the Court's jurisdiction by July 26, 2019.

         B. ...


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