Franchisor’s Financial Projections Don’t Equal Fraud – Ill. Law

In many fraud cases, defendants reflexively assert some variant of the “forward looking” or “promissory” fraud defense: that the misstatement relates to a future event and is therefore a non-actionable statement of opinion. Illinois fraud rules require a misrepresentation to be material and present-tense factual  to be actionable.  Statements of future intent – like a forecast or projection (“this company is gonna make …

Illinois ‘Reverse Piercing’ Law: Can You or Can’t You?

“Reverse piercing” involves the creditor of an individual shareholder attempting to reach assets of a corporation operated by that shareholder.  Illinois reverse-piercing law is unsettled.  Some cases allow  the remedy; others don’t.  When it is allowed, it usually involves a one-person corporation. In Fish v. Hennessy, 2013 WL 577012 (N.D.Ill 2013), the Northern District rejected a creditor’s …

IL First Dist. Examines Punitive Damage Standards In RE Fraud Suit

In K2 Development, LLC v. Braunstein, 2013 IL App (1st) 103672-U, the First District addressed Illinois law’s compensatory and punitive damages guideposts in a convoluted real estate fraud suit filed by an LLC against one of its two members. The plaintiff LLC – through one of its members (a real estate novice) – sued the LLC’s other member – an …