Berthoud v. Veselik, et al

Filing 167

MEMORANDUM OPINION AND ORDER Signed by the Honorable Robert M. Dow, Jr. on 4/9/2019. Mailed notice(cdh, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
JOHN BERTHOUD, individually
and as trustee,
Plaintiff,
v.
RANDALL VESELIK, et al.,
Defendants.

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Case No. 01-cv-6895
Judge Robert M. Dow, Jr.

MEMORANDUM OPINION AND ORDER
This matter is before the Court on the motions of Defendant Randall Veselik (“Veselik”)
to alter or amend judgment [160] and to stay proceedings while the motion to alter or amend is
pending [163]. Plaintiff John Berthoud (“Plaintiff”) opposes both motions. For the reasons stated
below, the motion to alter or amend judgment [160] is denied on its merits and the motion to stay
[163] is denied as moot.
I.

Background
The extensive background of this 2001 case is set forth in detail in the Court’s December

27, 2018 memorandum opinion and order [158], knowledge of which is assumed here. In that
order, the Court revived “Plaintiff’s May 9, 2003 judgment against Veselik in the original amount
of $1,400,000 (with Veselik to be credited at least $158,012.52 and perhaps as much as
$290,762.52 in the event that Plaintiff attempts to collect additional amounts in supplement
proceedings or execution), plus post-judgment interest in an amount to be determined in
supplemental proceedings.” [158] at 1.
In determining that Plaintiff was entitled to revival of his judgment against Veselik, the
Court took into consideration the parties’ supplemental briefs concerning the less-than-clear case

law concerning Illinois’ revival of judgment statute and, in particular, “what the courts mean when
they confine the inquiry that a court may make in considering a petition to revive a judgment to
the ‘face of the record.’” [158] at 4 (citing [144] at 3-4). Without ultimately resolving that
particular issue, the Court concluded that, even if Plaintiff’s answer and affirmative defenses were
considered to be part of the “record” considered by the Court, they were insufficient to justify
denial of Plaintiff’s petition because 1) none of statutory authority or case law indicated that
Veselik had a right to engage in discovery before the Court ruled on Plaintiff’s petition to revive
judgment; and 2) Veselik’s affirmative defenses of satisfaction and release were wholly
speculative in any event.
Veselik now asks the Court to alter or amend its judgment and to stay enforcement of the
judgment while his motion to alter or amend is pending.
II.

Legal Standard
Pursuant to Federal Rule of Civil Procedure 59(e), a party may file a motion to alter or

amend judgment within 28 days of entry of the judgment. To prevail on its motion, “the movant
must demonstrate a manifest error of law or fact or present newly discovered evidence.’” Ritacca
v. Storz Medical, A.G., 298 F.R.D. 566, 568 (N.D. Ill. 2014) (quoting Boyd v. Tornier, Inc., 656
F.3d 487, 492 (7th Cir. 2011)). A manifest error of law is the “wholesale disregard, misapplication,
or failure to recognize controlling precedent.” Oto v. Metro. Life Ins. Co., 224 F.3d 601, 606 (7th
Cir. 2000) (quoting Sedrak v. Callahan, 987 F. Supp. 1063, 1069 (N.D. Ill. 1997)). “This is a high
standard that is not demonstrated by the disappointment of the losing party.” Ritacca, 298 F.R.D.
at 568 (internal citation and quotation marks omitted). “Once judgment has been entered, there is
a presumption that the case is finished, and the burden is on the party who wants to upset that
judgment to show the court that there is good reason to set it aside.” Hecker v. Deere & Co., 556

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F.3d 575, 591 (7th Cir. 2009). “Whether to grant a motion to reconsider is a matter squarely within
the Court’s discretion.” Ritacca, 298 F.R.D. at 569.
III.

Analysis
Veselik argues that the Court committed manifest error by concluding that Plaintiff was

entitled to revival of a nearly sixteen-year old judgment against him without first giving Veselik a
chance to engage in discovery to support his alleged affirmative defenses of satisfaction and release
and, after that, holding an evidentiary hearing concerning those defenses. Veselik’s motion does
not address one of the primary bases of the Court’s decision, which was that, “regardless of
whether Veselik’s answer and affirmative defenses should be considered part of the ‘record’ to
which the Court’s inquiry must be confined, Veselik *** failed to identify any statutory authority
or case law indicating that he has a right to engage in discovery before the Court rules on
Defendant’s petition.” [158] at 9. Veselik’s current motion again fails to identify any “controlling
precedent” that would give him a right to pre-revival discovery or, following discovery, an
evidentiary hearing. Oto, 224 F.3d at 606. Therefore, Veselik cannot demonstrate that the Court’s
decision to revive Plaintiff’s judgment was based on a “manifest error of law” as required by Rule
59(e).
Further, Veselik’s attack on the remainder of the Court’s reasoning is not convincing.
Veselik claims that the Court improperly and “sua sponte struck” his affirmative defenses, even
though no motion to strike was pending. [160] at 2, 4. But the Court did not “strike” the
affirmative defenses. Instead, it determined that—even if there were any statutory authority or
case law authorizing discovery or evidentiary hearings in the context of a motion to revive
judgment—the affirmative defenses advanced by Veselik would nonetheless be insufficient “to

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justify discovery” or to “stave off the Court’s entry of an order reviving Plaintiff’s judgment”
because they were wholly speculative. [158] at 12.
Veselik contends that, in concluding that his affirmative defenses were speculative, the
Court improperly held him to a heightened fact pleading standard. As to his affirmative defense
of “satisfaction,” Veselik recognizes that he did not actually plead facts indicating full satisfaction
of the $1.4 million judgment, but nonetheless claims to be “entitled to th[at] inference.” [160] at
6. The Court is not persuaded by Veselik’s reasoning. The Court need not “accept as true”
Veselik’s “legal conclusion” that Plaintiff’s judgment has been fully satisfied, because the “factual
matter” pled in support of that conclusion, “accepted as true,” does not convince the Court that the
satisfaction defense is “plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). As the
Court explained in its prior opinion, the facts alleged do not suggest that Plaintiff collected
anywhere near his full $1.4 million investment. For instance, the counterclaim identifies a $5
million payment that Defendant Tower Square made to unspecified parties to settle two
unspecified claims. [147] at 7. But it does not allege that these were payments were made in
whole or in part to Plaintiff. The counterclaim also alleges on information and belief that “NASD
had also ordered Tower Square to pay restitution to Plaintiff and others,” id., but does not identify
any amount or any basis for this belief. The counterclaim further alleges on “information and
belief” that Plaintiff may have received settlement or restitution payments from other entities, who
are not parties to the lawsuit. Id. But again, the counterclaim does not identify any amounts, or
any basis for the belief that any of these entities made payments to Plaintiff. As the Court
previously explained, the allegations, taken as a whole, suggest that Veselik may be entitled to
some credits against the judgment. See [158] at 10-11. But they are insufficient to plausibly

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suggest, “above a speculative level,” that the full judgment has been satisfied. Cochran v. Illinois
State Toll Highway Auth., 828 F.3d 597, 599 (7th Cir. 2016).
As to his affirmative defense of release, Veselik argues that the Court “improperly struck
[it] as speculative” even though “the docket in this case shows that Plaintiff settled with one or
more of the other defendants and that Plaintiff dismissed his claims pursuant to that settlement.”
[160] at 7. Veselik asserts that he is “entitled to an inference that pursuant to the terms of that
settlement agreement, Plaintiff released all claims arising under the complaint including the claims
against Veselik.” [160] at 7. However, this is not a reasonable inference, for the reasons identified
in the Court’s prior opinion, [158] at 12, which Veselik ignores. The Court explained: “Veselik
does not identify any case law suggesting that a plaintiff’s settlement with and dismissal of some
defendants results in the release of the plaintiff’s claims against all other defendants. Nor does
Veselik contend that he was a party to or intended third-party beneficiary of any settlement
between Plaintiff and other Defendants. Instead, at the time that the remaining Defendants settled
and were dismissed, judgment had already been entered against Veselik for $1.4 million. Under
these facts, there is no plausible basis for concluding that Plaintiff entered into any settlement
agreement that provided for a release of his judgment against Veselik.” Id. Given Veselik’s failure
to even acknowledge the Court’s reasoning—let alone to show that it is contrary to “controlling
precedent,” Oto, 224 F.3d at 606—there is no reason for the Court to second-guess itself now.
IV.

Conclusion
For these reasons, Veselik’s motion to alter or amend judgment [160] is denied on its merits

and his motion to stay [163] is denied as moot.

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Dated: April 9, 2019

_________________________________
Robert M. Dow, Jr.
United States District Judge

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