Future Environmental, Inc. v. Forbes

Filing 47

MEMORANDUM Opinion and Order Signed by the Honorable Amy J. St. Eve on 7/3/2014:Mailed notice(kef, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
FUTURE ENVIRONMENTAL, INC.,

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Plaintiff,
v.
JONATHAN FORBES,
Defendant.

Case No. 13 C 709

MEMORANDUM OPINION AND ORDER
AMY J. ST. EVE, District Court Judge,
Before the Court is Plaintiff’s motion for summary judgment pursuant to Federal Rule of
Civil Procedure 56(a). For the following reasons, the Court grants Plaintiff’s summary judgment
motion.
BACKGROUND
I.

Northern District of Illinois Local Rule 56.1
Because Defendant is a pro se litigant, Plaintiff served him with a “Notice to Pro Se

Litigant Opposing Motion for Summary Judgment” as required by Northern District of Illinois
Local Rule 56.2. The notice explains the consequences of failing to properly respond to a
motion for summary judgment and statement of material facts under Federal Rule of Civil
Procedure and Local Rule 56.1.
Local Rule 56.1 “is designed, in part, to aid the district court, ‘which does not have the
advantage of the parties’ familiarity with the record and often cannot afford to spend the time
combing the record to locate the relevant information,’ in determining whether a trial is

necessary.” Delapaz v. Richardson, 634 F.3d 895, 899 (7th Cir. 2011) (citation omitted). Local
Rule 56.1(a)(3) requires the moving party to provide “a statement of material facts as to which
the moving party contends there is no genuine issue.” Cracco v. Vitran Exp., Inc., 559 F.3d 625,
632 (7th Cir. 2009). “The opposing party is required to file ‘a response to each numbered
paragraph in the moving party’s statement, including, in the case of any disagreement, specific
references to the affidavits, parts of the record, and other supporting materials relied upon.” Id.
(citing N.D. Ill. R. 56.1(b)(3)(B)). Local Rule 56.1(b)(3)(C) requires the nonmoving party to
present a separate statement of additional facts that requires the denial of summary judgment.
See Ciomber v. Cooperative Plus, Inc., 527 F.3d 635, 643-44 (7th Cir. 2008).
In general, the purpose of Local Rule 56.1 statements and responses is to identify the
relevant admissible evidence supporting the material facts, not to make factual or legal
arguments. See Cady v. Sheahan, 467 F.3d 1057, 1060 (7th Cir. 2006) (“statement of material
facts did [] not comply with Rule 56.1 as it failed to adequately cite the record and was filled
with irrelevant information, legal arguments, and conjecture”). “When a responding party’s
statement fails to dispute the facts set forth in the moving party’s statement in the manner
dictated by the rule, those facts are deemed admitted for purposes of the motion.” Cracco, 559
F.3d at 632; see also Frey Corp. v. City of Peoria, Ill., 735 F.3d 505, 513 (7th Cir. 2013).
In sum, “[f]or litigants appearing in the Northern District of Illinois, the Rule 56.1
statement is a critical, and required, component of a litigant’s response to a motion for summary
judgment. The purpose of the local rule is to make the summary judgment process less
burdensome on district courts, by requiring the parties to nail down the relevant facts and the
way they propose to support them.” Sojka v. Bovis Lend Lease, Inc., 686 F.3d 394, 398 (7th Cir.
2012).

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Defendant has failed to respond to the motion for summary judgment more than one
month after the deadline for his response. As such, the Court accepts all properly supported
assertions in Plaintiff’s statement of material facts at true to the extent that the facts are
supported in the record. See L.R. 56.1(b)(3)(C); Apex Digital, Inc. v. Sears, Roebuck & Co., 735
F.3d 962, 965 (7th Cir. 2013); Keeton v. Morningstar, Inc., 667 F.3d 877, 880 (7th Cir. 2012).
In addition, the Court is not required to scour the record looking for factual disputes nor is the
Court required to piece together Defendant’s arguments for him. See Diadenko v. Folino, 741
F.3d 751, 757 (7th Cir. 2013); see also Herman v. City of Chicago, 870 F.2d 400, 404 (7th Cir.
1989) (“A district court need not scour the record to make the case of a party who does
nothing.”). Defendant’s failure to comply with Local Rule 56.1, however, does not result in an
automatic grant of summary judgment in favor of Plaintiff. Instead, the Court still must evaluate
all facts in the light most favorable to him, the non-moving party. See Fed. R. Civ, P. 56(e)(2);
Keeton, 667 F.3d at 884. With these standards in mind, the Court turns to the relevant facts of
this case.
II.

Relevant Facts
Plaintiff Future Environmental, Inc. (“Future”) is an Illinois corporation with its principal

place of business in Mokena, Illinois. Defendant Jonathan Forbes (“Forbes”) is a citizen of the
State of Indiana. The matter in controversy exceeds $75,000, thus the Court has diversity
jurisdiction.
Future employed Defendant Forbes as a truck driver from May 18, 2009 through
December 7, 2012. (R. 42-2 ¶ 4.) Future contracts with Wright Express Corporation (“WEC”)
for fleet fuel cards for the drivers of its fleet of trucks. WEC is a fuel card company that issues
fuel cards to companies with fleets in order to make fuel purchases easier for drivers and to

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consolidate fuel purchase expense reporting. (Id. ¶ 5.) Future gave each of its drivers his own
WEC card. (Id. ¶ 6.) Each WEC card had a different account number and each driver was given
his own personal identification number (“PIN”) to use with his WEC card. (Id.) During the
relevant time, Future assigned each driver a PIN that was the last 4 digits of the driver’s social
security number. (Id. ¶ 7.) Future attempted to maintain secrecy of its assigned PINs from other
drivers and gave its drivers specific instructions regarding the WEC card. Specifically, Future
instructed its drivers that (1) each driver could only use the card for company fuel purchases; (2)
each driver had his own PIN to use with the card; (3) the driver maintained the responsibility for
his WEC card; and (4) the driver could not give the card to anyone else to use. (Id. ¶ 9.) In order
to purchase gas at a pump, the driver had to insert his PIN to identify his use of the card. (Id. ¶
10.)
In approximately early December 2012, a third party informed Future that Forbes was
using his WEC card to sell fuel at very large discounts to people at gas stations. (Id. ¶ 11.) After
receiving this tip, Future’s management did an internal review of the WEC fuel purchase reports,
especially because it had not closely monitored the WEC monthly reports. These WEC reports
revealed that Defendant Forbes was using his WEC card to purchase fuel far beyond the amount
necessary for use of his company vehicles. (Id. ¶ 14.) On December 1, 2012, for example,
Forbes made 22 separate purchases of fuel, totaling 2,116.011 gallons of fuel. (Id. ¶ 15.)
Twenty-one of these purchases were made within a period of only two hours. (Id.) In addition,
13 of the 22 purchases were less than five minutes apart from the prior purchase. (Id.) Thirteen
of the purchases occurred at the same gas station. (Id.) The total cost to Future for the gas
purchases on Forbes’ WEC fuel card on December 1, 2012, was $8,326.41. (Id.) Forbes also

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obtained other drivers’ WEC PINs and used those PINs to make fuel purchases on his card. (Id.
¶¶ 17, 18, 19.)
On December 7, 2012, Steve Lempera, Future’s President, went to Forbes’ job site to
confront him regarding his improper use of the fuel card. Forbes handed his WEC fuel card to
Lempera. Lempera terminated Forbes’s employment that same day. Shortly after Lempera
terminated Forbes’ employment, Forbes came to Lempera’s office at Future’s headquarters in
Mokena, Illinois. (Id. ¶ 24.) Forbes admitted to Lempera that he was improperly using the WEC
card to make fuel purchases for other people. (Id. ¶ 25.) Forbes told Lempera that he would
repay Lempera for the improper purchases, but he did not want to be arrested because he had a
family to take care of. (Id. ¶ 25.) Forbes, however, never repaid any of the money. (Id. ¶ 26.)
SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate “if the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P.
56(a). A genuine dispute as to any material fact exists if “the evidence is such that a reasonable
jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S.
242, 248, 106 S. Ct. 2505, 2510, 91 L. Ed. 2d 202 (1986). In determining summary judgment
motions, “facts must be viewed in the light most favorable to the nonmoving party only if there
is a ‘genuine’ dispute as to those facts.” Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167
L.Ed.2d 686 (2007). The party seeking summary judgment has the burden of establishing that
there is no genuine dispute as to any material fact. See Celotex Corp. v. Catrett, 477 U.S. 317,
323, 106 S. Ct. 2548, 91 L.Ed.2d 265 (1986). After “a properly supported motion for summary
judgment is made, the adverse party ‘must set forth specific facts showing that there is a genuine
issue for trial.’” Anderson, 477 U.S. at 255 (quotation omitted).

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ANALYSIS
Plaintiff has sued Defendant Forbes for the following causes of action: 1) breach of a
fiduciary duty; 2) conversion; and 3) fraud. Plaintiff now moves for summary judgment on each
of these claims.
I.

Breach of Fiduciary Duty
In order to establish breach of a fiduciary duty in Illinois, Plaintiff must prove the

following: “(1) a fiduciary duty exists; (2) the fiduciary duty was breached; and (3) the breach
proximately caused the injury of which the plaintiff complains.” Ball v. Kotter, 723 F.3d 813,
826 (7th Cir. 2013), citing Neade v. Portes, 193 Ill.2d 433, 250 Ill.Dec. 733, 739 N.E.2d 496,
502 (2000). Viewing the evidence in the light most favorable to Defendant, Plaintiff has
established that Defendant breached his fiduciary duty to Plaintiff.
Employees owe a fiduciary duty to their employers. Lawlor v North Am. Corp. of Ill.,
368 Ill.Dec. 1, 983 N.E.2d 414, 433 (Ill. 2012). See also Kovac v. Barron, 6 N.E.3d 819, 379 Ill.
Dec. 491, 505 (2d Dist. 2014) (employees owe a fiduciary duty to the corporate employer);
Foodcomm Int’l. v. Barry, 328 F.3d 300, 304 (7th Cir. 2003) (“employees, as agents of their
employer, do not fall outside the purview of a breach of fiduciary duties”). As part of his
employment, Plaintiff entrusted Defendant with a fuel card to use for work purposes only.
Plaintiff Future specifically instructed Defendant that he could only use the fuel card for
company fuel purchases, he had to use his own unique PIN with the card, and he could not give
the card to anyone else. Defendant had an obligation to use the fuel card as authorized by
Plaintiff. Plaintiff has established that Defendant breached his fiduciary duty when he used
Plaintiff’s WEC fuel card, without Plaintiff’s knowledge, for unauthorized purchases of fuel. He
also used the PIN number of other employees to make unauthorized purchases. Defendant’s

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improper use of the fuel card caused the financial loss to Plaintiff. Plaintiff, therefore, is entitled
to summary judgment on this count.
II.

Conversion
Plaintiff also brings a common law conversion count against Defendant. To prove

conversion under Illinois law, a plaintiff must establish the following elements: (1) that the
plaintiff has a right to the property; (2) that the plaintiff has an absolute and unconditional right
to the immediate possession of the property; (3) that the plaintiff made a demand for possession;
and (4) that the defendant wrongfully and without authorization assumed control, dominion, or
ownership over the property. Kovac, 6 N.E.3d at 838, citing Cirrincione v. Johnson, 184 Ill.2d
109, 114, 234 Ill.Dec. 455, 703 N.E.2d 67 (1998). “Money may be the subject of conversion, but
it must be capable of being described as a specific chattel, although it need not be specifically
earmarked.” Kovac, 6 N.E.3d at 838. It must be shown that the money “at all times belonged to
the plaintiff and that the defendant converted it to his own use.” Id. “[A]n action for the
conversion of funds may not be maintained to satisfy a mere obligation to pay money.” In re
Thebus, 108 Ill.2d 255, 91 Ill.Dec. 623, 483 N.E.2d 1258, 1260 (1985). See also Cohen v.
American Sec. Ins. Co., 735 F.3d 601, 614 (7th Cir. 2013).
Here, no genuine dispute exists that Defendant converted Plaintiff’s funds when he used
Plaintiff’s fuel card in order to purchase fuel for others unrelated to Plaintiff’s business. The fuel
card and the money spent on it belonged to Plaintiff and Plaintiff had an absolute and
unconditional right to the immediate possession of it. Indeed, Defendant Forbes admitted to
Future’s President that he was improperly using the fuel card to make fuel purchases for other
people. Plaintiff made a demand for the money. It is undisputed that Defendant Forbes told
Plaintiff that he would repay it for the improper purchases, but he never did. Plaintiff never

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authorized Defendant to use the fuel card to purchase fuel for any reason other than Plaintiff’s
business, yet Defendant nonetheless wrongfully did so. Plaintiff has met its burden. As such,
the Court grants summary judgment for Plaintiff on its conversion claim.
III.

Fraud
In Illinois, a plaintiff can base a common law fraud claim on a fraudulent

misrepresentation or on a fraudulent concealment of a material fact. Trs. of AFTRA Health Fund
v. Biondi, 303 F.3d 765, 776 (7th Cir. 2002). In order for Plaintiff to prove a claim premised on
a fraudulent concealment, Plaintiff must prove the following:
(1) the concealment of a material fact; (2) the concealment was intended to induce a false
belief, under circumstances creating a duty to speak; (3) the innocent party could not
have discovered the truth through a reasonable inquiry or inspection, or was prevented
from making a reasonable inquiry or inspection, and relied upon the silence as a
representation that the fact did not exist; (4) the concealed information was such that
the injured party would have acted differently had he been aware of it; and (5) that
reliance by the person from whom the fact was concealed led to his injury.
Id. at 777. In addition, “[t]o plead [fraudulent concealment] properly, in addition to meeting the
elements of fraudulent misrepresentation, a plaintiff must allege that the defendant intentionally
omitted or concealed a material fact that it was under a duty to disclose to the plaintiff.” Wigod
v. Wells Fargo Bank, N.A., 673 F.3d 547, 571 (7th Cir. 2012) (citing Weidner v. Karlin, 402
Ill.App.3d 1084, 342 Ill.Dec. 475, 932 N.E.2d 602, 605 (3d Dist. 2010)). A fiduciary
relationship gives rise to a duty to disclose. Wigod, 673 F.3d at 571 (quoting Connick v. Suzuki
Motor Co., 174 Ill.2d 482, 221 Ill.Dec. 389, 675 N.E.2d 584, 593 (Ill. 1996)).
Because Defendant owed a fiduciary duty to Plaintiff, Defendant had a duty to disclose
his improper use of the fuel card to Plaintiff. Plaintiff entrusted Defendant with the fuel card and
relied upon his honesty to use to card for company fuel purchases. There is no genuine dispute
that Defendant used the fuel card for unauthorized purchases and concealed this fact from

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Plaintiff. Defendant further concealed his actions through the use of other employee’s PIN
numbers. Defendant’s concealment of the improper usage led to Plaintiff’s financial injury.
Furthermore, Defendant does not dispute that Plaintiff could not have discovered the truth of his
improper actions through a reasonable inquiry or inspection. The Court therefore grants
summary judgment for Plaintiff on this claim.
IV.

Damages
Plaintiff seeks both compensatory and punitive damages for Defendant’s wrongs. The

Court addresses each category of damages separately.
A.

Compensatory

Defendant Forbes used his fuel card to purchase $180,266.83 in fuel from December 1,
2011 through December 7, 2012. (R. 42-4 at ¶ 29.) Specifically, he purchased the following
amounts:
December 2011:
January 2012:
February 2012:
March 2012:
April 2012:
May 2012:
June 2012:
July 2012:
August 2012:
September 2012:
October 2012:
November 2012:
December 2012 (only 7 days):
TOTAL:

$ 4,341.55
$ 4,078.15
$ 3,734.26
$ 7,053.54
$ 3,707.59
$10,007.87
$ 7,842.98
$13,011.36
$19,659.27
$34,385.27
$29,0067.51
$31,870.77
$11,567.71
$180,266.83

(Id.)
It is undisputed Plaintiff Future’s truck drivers do not spend more than $2,000 per month — or
$22,500 during this time period — on fuel purchases with their fuel cards. (Id. ¶ 28.) Plaintiff
paid the full $180,266.83 in fuel charges on Defendant’s fuel card, even though Defendant could
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not have charged more than $22,500 in fuel for work purposes during this time period. (Id. ¶
30.) The Court therefore awards Plaintiff compensatory damages in the amount of $157,766.83.
B.

Punitive

In addition, Plaintiff seeks punitive damages against Defendant Forbes. Illinois law
permits the award of punitive damages for conversion and breach of fiduciary duty claims. See
Cirrincione v. Johnson, 184 Ill.2d 109, 114, 234 Ill.Dec. 455, 703 N.E.2d 67, 70 (1998)
(conversion); Tully v. McLean, 409 Ill.App.3d 659, 670, 948 N.E.2d 714, 350 Ill.Dec. 434 (1st
Dist. 2011) (breach of fiduciary duty). Under Illinois law, punitive damages are available if “the
defendant has acted willfully, or with such gross negligence as to indicate a wanton disregard of
the rights of others.” Blount v. Stroud, 395 Ill.App.3d 8, 20, 333 Ill.Dec. 845, 915 N.E.2d 925
(1st Dist. 2009) (citing Kelsay v. Motorola, Inc., 74 Ill.2d 172, 186, 23 Ill.Dec. 559, 384 N.E.2d
353 (1978)). In assessing reprehensibility, courts consider the following factors:
(1) whether the harm caused was physical as opposed to economic; (2) whether the
tortious conduct evinced an indifference to or a reckless disregard for the health and
safety of others; (3) whether the target of the conduct was financially vulnerable; (4)
whether the conduct involved repeated actions or was an isolated incident; and (5)
whether the harm was the result of intentional malice, trickery, or deceit, or mere
accident.
Int’l. Union of Oper. Eng’rs, Local 150 v. Lowe Excavating Co., 225 Ill.2d 456, 470, 312 Ill.Dec.
238, 870 N.E.2d 303 (2006). Given Defendant’s excessive charges and willful conduct, the
Court, in its discretion, awards Plaintiff punitive damages in the amount of $25,000.

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CONCLUSION
For these reasons, the Court grants Plaintiff’s motion for summary judgment. Judgment
is entered against Defendant Forbes in the amount of $182,766.83.

Dated: July 3, 2014
ENTERED

______________________________
AMY J. ST. EVE
United States District Court Judge

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