GoHealth LLC v. Simpson et al

Filing 106

ORDER signed by the Honorable Edmond E. Chang. For the reasons stated in the Order, the partial motion to dismiss 72 is granted in part and denied in part. Mailed notice(slb, )

UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
GOHEALTH, LLC,

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Plaintiff,
v.
PAUL SIMPSON; JOSEPH LOCONTI;
JAKE MENDELL; ZOOM HEALTH,
INC.; LIGHTHOUSE INSURANCE
GROUP, LLC; CHUCK FARRO; and
JASON FARRO,
Defendants.

No. 13 C 02334

Judge Edmond E. Chang

ORDER
Plaintiff GoHealth, LLC brings this lawsuit against Defendants Zoom
Health, Inc., Paul Simpson, Joseph LoConti, and Jake Mendell (collectively, the
Zoom Defendants), and against Lighthouse Insurance Group, LLC, Jason Farro,
and Chuck Farro (collectively, the Lighthouse Defendants), asserting a variety of
Illinois state-law claims arising out of a failed business relationship between
GoHealth and Defendants.1 R. 71, Second Am. Compl. Defendants have moved to
dismiss [R. 72] Counts Three (breach of fiduciary duty – Zoom), Four (veil piercing –
Zoom), Five (indemnity), Six (Uniform Fraudulent Transfer Act – Zoom), Seven
(conspiracy), Eight (aiding and abetting breach of fiduciary duty – Lighthouse),
Nine (Uniform Fraudulent Transfer Act – Lighthouse), Ten (veil piercing –
1As

explained in the November 26, 2013 Order [R. 76], this Court has subject matter
jurisdiction under 28 U.S.C. § 1332.

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Lighthouse), and Eleven (tortious interference with contract – Lighthouse) of
GoHealth’s Second Amended Complaint under Federal Rule of Civil Procedure
12(b)(6). On November 26, 2013, the Court entered an Order [R. 76] deciding
Counts Three (breach of fiduciary duty), Four (veil piercing of Zoom), and Five
(indemnity) of Defendants’ motion. The Court now addresses the remaining counts.
For the reasons explained below, Defendants’ partial motion to dismiss is granted in
part and denied in part.
I. Legal Standard
“A motion under Rule 12(b)(6) challenges the sufficiency of the complaint to
state a claim upon which relief may be granted.” Hallinan v. Fraternal Order of
Police Chicago Lodge No. 7, 570 F.3d 811, 820 (7th Cir. 2009). “[W]hen ruling on a
defendant’s motion to dismiss, a judge must accept as true all of the factual
allegations contained in the complaint.” Erickson v. Pardus, 551 U.S. 89, 94 (2007).
A “complaint must contain sufficient factual matter, accepted as true, to ‘state a
claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009) (quoting Bell Atl. v. Twombly, 550 U.S. 544, 570 (2007)). These allegations
“must be enough to raise a right to relief above the speculative level.” Twombly, 550
U.S. at 555. And the allegations that are entitled to the assumption of truth are
those that are factual, rather than mere legal conclusions. Iqbal, 556 U.S. at 679.
Ordinarily, under Federal Rule of Civil Procedure 8(a)(2), a complaint
generally need only include “a short and plain statement of the claim showing that
the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). But claims alleging fraud

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must also satisfy the heightened pleading requirement of Federal Rule of Civil
Procedure Rule 9(b), which requires that “[i]n alleging fraud or mistake, a party
must state with particularity the circumstances constituting fraud or mistake.” Fed.
R. Civ. P. 9(b) (emphasis added). Thus, Rule 9(b) requires that fraud claims “state
the identity of the person making the misrepresentation, the time, place, and
content of the misrepresentation, and the method by which the misrepresentation
was communicated to the plaintiff.” Uni*Quality, Inc. v. Infotronx, Inc., 974 F.2d
918, 923 (7th Cir. 1992) (internal quotation marks omitted). Put differently, fraud
claims “must describe the who, what, when, where, and how of the fraud.” Pirelli
Armstrong Tire Corp. Retiree Med. Benefits Trust v. Walgreen Co., 631 F.3d 436,
441-42 (7th Cir. 2011) (internal quotation marks and citation omitted).
II. Analysis
At issue in this Order are Counts Six (Uniform Fraudulent Transfer Act –
Zoom), Seven (conspiracy), Nine (Uniform Fraudulent Transfer Act – Lighthouse),
Ten (veil piercing – Lighthouse), and Eleven (tortious interference with contract –
Lighthouse) of GoHealth’s Second Amended Complaint.2 The Court assumes the
reader’s familiarity with the relevant background of this case as described in the
November 26 Order [R. 76] and will repeat below only what is necessary to decide
the currently pending motion. In considering Defendants’ Rule 12(b)(6) motion, the
Court looks to both the Second Amended Complaint and the additional facts alleged
2Defendants

also move to dismiss Count Eight (aiding and abetting breach of fiduciary duty
– Lighthouse) of GoHealth’s Second Amended Complaint. R. 72. But in light of the
November 26 Order granting Defendants’ motion to dismiss Count III (breach of fiduciary
duty) GoHealth acknowledges that Count VIII (a dependent claim) must also be dismissed.
R. 89, Pl.’s Br. at 2. So it is dismissed.

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in GoHealth’s supplemental brief [R. 96]; the Court allowed consideration of facts in
the supplemental brief in lieu of allowing yet another amended complaint while the
motion to dismiss was pending. The Court addresses each count in turn.
A. Count Ten: Veil Piercing (Lighthouse)
In Count Ten, GoHealth seeks to pierce Lighthouse’s corporate veil and hold
Chuck and Jason Farro personally liable for Lighthouse’s debts. See Second Am.
Compl. ¶¶ 150-59. At the outset, Defendants reiterate their argument from the
earlier motion to dismiss that veil-piercing is not an independent cause of action as
a matter of Illinois state law. Def.’s Br. (citing R. 62 at 3-4). For the reasons
explained in the November 26 Order with respect to Count Four, see R. 76 at 16-17,
the Court construes Count Ten not as a standalone legal claim, but as a theory of
personal liability for the other legal claims in the Second Amended Complaint.
Because the imposition of personal liability against the Lighthouse Defendants
affects the viability of other claims at issue in Defendants’ motion, the Court
addresses Count Ten first.
Generally, officers of a corporation are not liable for the corporation’s debts
and obligations. Macaluso v. Jenkins, 420 N.E.2d 251, 254 (Ill. App. Ct. 1981). If the
corporation is merely the alter ego of its officers, however, a court may disregard the
corporate form and pierce the corporate veil of limited liability to hold the officers
personally liable. Tower Investors, LLC v. 111 E. Chestnut Consultants, Inc., 864
N.E.2d 927, 941 (Ill. App. Ct. 2007). Specifically, courts may pierce the corporate
veil if (1) there is such a unity of interest and ownership that the corporation and its

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officers are no longer separate personalities, and (2) maintaining the fiction of a
separate corporation would promote injustice or inequitable circumstances. Id.
On the first prong, unity of interest, Illinois law considers numerous factors,
including the following:
(1) inadequate capitalization; (2) failure to issue stock; (3) failure to observe
corporate formalities; (4) nonpayment of dividends; (5) insolvency of the
debtor corporation; (6) nonfunctioning of the other officers or directors; (7)
absence of corporate records; (8) commingling of funds; (9) diversion of assets
from the corporation by or to a stockholder or other person or entity to the
detriment of creditors; (10) failure to maintain arm’s-length relationships
among related entities; and (11) whether the corporation is in fact a mere
facade for the operation of the dominant stockholders.
Fontana v. TLD Builders, Inc., 840 N.E.2d 767, 778 (Ill. App. Ct. 2005). GoHealth
contends that factors three (failure to observe corporate formalities), ten (failure to
maintain an arms-length relationship), and eleven (Lighthouse was a mere façade)
weigh in favor of veil-piercing. Pl.’s Br. at 10-11. But, as explained below, GoHealth
has not adequately alleged any of these factors as to Lighthouse.
In going after Lighthouse, GoHealth tries to rely on the Court’s prior
conclusion that the veil-piercing allegations against Zoom were enough: GoHealth
argues that the allegations are “sufficiently and similarly outlined as to Lighthouse
to lead this Court to the same conclusion regarding Chuck Farro and Jason Farro.”
Pl.’s Br. at 10. But the Farros’ alleged relationship with Lighthouse is markedly
different from LoConti’s and Simpson’s alleged relationship with Zoom. Indeed,
most of GoHealth’s allegations regarding the Farros do not even relate to
Lighthouse, highlighting instead the Farros’ involvement with Zoom’s side of the
allegedly fraudulent transaction. See id.; Second Am. Compl. at ¶ 32 (alleging
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Farros “communicated regularly” with Zoom Defendants regarding Zoom’s debt); id.
¶¶ 33-34, 40-41 (alleging Lighthouse Defendants participated in the asset transfer
and employed a number of Zoom employees); id. ¶ 42 (alleging Farros, who had a
financial interest in, exercised control over, and influenced direction of Zoom,
retained control over Zoom’s assets post-transfer); Pl.’s Supp. Br. at 6-8 (alleging
Farros participated in Zoom’s negotiations with another potential buyer). GoHealth
does not explain how these allegations that the Farros were “equally complicit” in
Zoom’s asset transfer, see Pl.’s Br. at 10, establish that Lighthouse was a mere
“dummy or sham” for the Farros, see Wachovia Sec., LLC v. Banco Panamericano,
Inc., 674 F.3d 743, 752 (7th Cir. 2012) (quotation marks omitted). And the current
complaint’s three-sentence, conclusory recitation of factors three, ten, and eleven is
no more instructive. See Second Am. Compl. at 11.
In short, GoHealth has not pled enough facts to suggest that, as to
Lighthouse and the Farros, “there is such a unity of interest and ownership that the
separate personalities of the corporation and the parties who compose it no longer
exist.” Tower Investors, 864 N.E.2d at 941. Ultimately, the interests of justice may
merit amendment of GoHealth’s Second Amended Complaint after party
depositions, but at this stage, GoHealth has not adequately stated a veil-piercing
claim against the Farros. Defendants’ motion to dismiss is granted as to Count Ten.
B. Counts Six and Nine: Uniform Fraudulent Transfer Act
Count Six of the Second Amended Complaint alleges that the Zoom
Defendants violated unspecified provisions of the Uniform Fraudulent Transfer Act

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(UFTA) under Ohio, California, or Illinois law. Second Am. Compl. ¶¶ 112-121.
Count Nine extends the same allegations to the Lighthouse Defendants. Id. ¶¶ 137147. “Under the UFTA, there are two types of fraud; actual fraud or ‘fraud in fact,’
and constructive fraud or ‘fraud in law.’” Cordes & Co., LLC v. Mitchell Companies,
LLC, 605 F. Supp. 2d 1015, 1020 (N.D. Ill. 2009). “Fraud in fact exists when the
debtor has the specific intent to hinder his creditors.” Id. “Fraud in law exists when
the debtor conveys assets for inadequate consideration, rendering himself insolvent
during a time when he has existing or contemplated indebtedness.” Id.
GoHealth alleges that the asset transfer from Zoom to Lighthouse was
fraudulent under the UFTA because, among other reasons, it was made (1) “with
actual intent to hinder, delay, and defraud GoHealth,” (2) without “reasonably
equivalent value,” and (3) to “insiders.” Second Am. Compl. ¶ 121. Based on these
allegations, the Court construes Counts Six and Nine as having alleged both actual
and constructive fraud. Defendants argue that GoHealth’s UFTA claims should be
dismissed for three reasons: (1) they are inadequately pled under Rule 8, (2) they
are inadequately pled under Rule 9(b), and (3) the UFTA does not recognize
individual liability for insiders of a debtor corporation. Def.’s Br. at 5-9.
Whether Rule 9(b)’s heightened pleading standard applies depends on which
state’s version of the UFTA applies,3 so the Court first addresses which state’s law

Compare Sunnyside Dev. Co. LLC v. Cambridge Display Tech. Ltd., 2008 WL 4450328, at
*9 (N.D. Cal. Sept. 29, 2008) (Rule 9(b) does not apply to constructive fraud claim under
California UFTA), and Van-American Ins. Co. v. Schiappa, 191 F.R.D. 537, 542 (S.D. Ohio
2000) (Rule 9(b) does not apply to constructive fraud claim under Ohio UFTA), with General
Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1079 (7th Cir. 1997) (Rule 9(b)
does apply to constructive fraud claim under Illinois UFTA).
3

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applies in this case. Under Seventh Circuit law, the following choice-of-law analysis
applies to GoHealth’s claims:
When a district court sits in diversity, it must apply the choice of law
principles of the forum state to determine which state’s substantive law
governs the proceeding. In this case, . . . we look to Illinois's choice of law
rules. For tort actions, Illinois instructs the court to ascertain the forum with
the “most significant relationship” to the case. Under this test, the law of the
place of injury controls unless Illinois has a more significant relationship
with the occurrence and with the parties. Four factors are supposed to guide
the court's decision: (1) where the injury occurred; (2) where the injurycausing conduct occurred; (3) the domicile of the parties; and (4) where the
relationship of the parties is centered. The court evaluates these factors in
light of the policies underlying the laws of those jurisdictions.
Tanner v. Jupiter Realty Corp., 433 F.3d 913, 915-16 (7th Cir. 2006) (internal
quotation marks and citations omitted). Applying these factors here, it is clear that
Illinois law applies: (1) GoHealth’s alleged injury occurred in Illinois, where it is
domiciled and its services were rendered, Second Am. Compl. ¶¶ 2, 14; (2)
Defendants’ injury-causing conduct presumably occurred in California and Ohio,
where Defendants are domiciled, id. ¶¶ 3-9; (3) the parties are, respectively,
domiciled in Illinois, California, and Ohio, id. ¶¶ 2-9; and (4) the parties’ contracts
and the Second Amended Complaint show that their relationship was centered in
Illinois, id. ¶¶ 6, 7, 14, 15, 18, 19; R. 71, Exh. A, Business Dev. Agreement ¶ 18; R.
71, Exh. B, Simpson Agreement ¶ 16. Because Illinois is both the place where
GoHealth’s injury occurred and also the state with the most significant relationship
to the parties and to GoHealth’s claims, the Court analyzes Counts Six and Nine
under Illinois law. See Tanner, 433 F.3d at 915-16.

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Under the Illinois Uniform Fraudulent Transfer Act (IUFTA), a transfer
made by a debtor “is fraudulent as to a creditor whose claim arose before the
transfer was made . . . if the debtor made the transfer . . . without receiving a
reasonably equivalent value in exchange for the transfer . . . and the debtor was
insolvent at that time or . . . became insolvent as a result of the transfer.” 740 ILCS
160/6(a). Defendants argue that GoHealth’s constructive-fraud claims under this
provision of the IUFTA should be dismissed under Rule 8(a) because GoHealth has
not adequately alleged that Zoom’s assets were transferred to Lighthouse for “less
than reasonably equivalent value.”4 Def.’s Br. at 5. Specifically, Defendants contend
that GoHealth “fails to provide any facts to support its conclusory allegation that
the Asset Purchase Agreement was for less than reasonably equivalent value”
because GoHealth did not allege which assets were transferred or the fair market
value of those assets. Id. at 8 (emphasis in original).
The Seventh Circuit has held that, in order to evaluate whether a transfer is
fraudulent under the IUFTA, a court should “determine the value of what was
transferred and . . . compare it to what was received.” Creditor’s Comm. of Jumer’s
Castle Lodge, Inc. v. Jumer, 472 F.3d 943, 947 (7th Cir. 2007) (citation omitted).

4Defendants’ opening brief argued broadly that GoHealth’s UFTA claims should be
dismissed in their entirety because GoHealth inadequately alleged that Zoom transferred
its assets for “less than reasonably equivalent value.” Def.’s Br. at 5. But a transfer for less
than reasonably equivalent value is only an element of a constructive-fraud claim, and not
all forms of fraudulent transfer, as Defendants appear to concede in their more narrowly
crafted reply brief. See 740 ILCS 160/6(a); R. 90, Def.’s Reply Br. at 5 (arguing instead that
“[t]he constructive fraud claim under the UFTA fails because Plaintiff does not plead any
facts to support its conclusory allegation that Zoom’s assets were purchased for ‘less than
reasonably equivalent value’”). Thus, the Court limits Defendants’ reasonably-equivalentvalue argument to GoHealth’s constructive-fraud claim under 740 ILCS 160/6(a).

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GoHealth alleges that Zoom sold “all corporate assets to Lighthouse” in exchange
for $500,000. Second Am. Compl. ¶¶ 1, 37. While GoHealth does not estimate the
fair market value of the transferred assets, it does allege that before the Lighthouse
transfer, its parent company, Norvax, LLC, had agreed to forbear on collecting
$1,229,189.62 of Zoom’s debt in exchange for a majority of Zoom’s assets. Id. ¶ 30.
At the motion-to-dismiss stage, the fact that Norvax would have exchanged $1.2
million in value for a majority of Zoom’s assets is sufficient to support GoHealth’s
allegation that $500,000 was less than reasonably equivalent value for Zoom’s
assets. Thus, Defendants’ motion to dismiss GoHealth’s constructive-fraud claim on
Rule 8(a) grounds is denied.
Defendants next argue that because both actual- and constructive-fraud
claims are subject to Rule 9(b)’s heightened pleading standard under Illinois law,
see General Electric, 128 F.3d at 1079, GoHealth’s UFTA claims fail under that
standard as well, Def.’s Br. at 8. In particular, Defendants contend that by
impermissibly “lump[ing] all the defendants together” and failing to specify “who
was involved in what activity,” GoHealth has failed to allege how the $500,000
purchase of Zoom’s assets was made, who made it, who received it, and under what
circumstances. Id. (quoting Coronet Ins. Co. v. Seyfarth, 665 F. Supp. 661, 665 (N.D.
Ill. 1987)).
It is true that the allegations in the Second Amended Complaint often group
Defendants together without identifying individual defendants’ involvement in the
alleged fraud. See, e.g., Second Am. Compl. at ¶¶ 33-35. With respect to Defendants

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Simpson and LoConti, GoHealth has nevertheless pled sufficiently individualized
allegations to satisfy the requirements of Rule 9(b): GoHealth plausibly alleges that
LoConti and Simpson devised a plan to sell Zoom’s assets secretly to Lighthouse, at
a sham price, in order to avoid repaying debts owed to GoHealth, id. ¶ 34, and that
LoConti and Simpson personally prevented even the proceeds from the Zoom asset
sale ($500,000) from being paid to GoHealth, and instead redirected those proceeds
into their own pockets, id. ¶¶ 93, 94. Altogether, GoHealth’s allegations adequately
identify which activities in the alleged fraud can be attributed to LoConti and
Simpson. As to Defendant Mendell, however, GoHealth’s allegations are
inadequate. As a non-owner of Zoom who merely accepted a position at Lighthouse
post-transfer, see id. ¶¶ 5, 41, Mendell’s role in the alleged fraudulent transfer is
unclear. The only allegations against Mendell in the context of the alleged fraud are
those against the Zoom Defendants generally. These are insufficient to state a claim
of fraud against Mendell under Rule 9(b). Thus, Defendants’ motion to dismiss
Count Six is granted as to Mendell and denied as to LoConti and Simpson. For
reasons explained below, even assuming that GoHealth’s allegations against the
Lighthouse Defendants satisfy the 9(b) standard, Count Ten is nevertheless
dismissed as to the Farros because there is no basis to hold them personally liable
under the IUFTA.
Defendants’ final argument in support of dismissing Counts Six and Nine is
that the IUFTA does not permit the imposition of personal liability against the
individual defendants. See Def.’s Br. at 9. The Seventh Circuit has explained that

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“[u]nder Illinois law, a claim for a fraudulent transfer requires a debtor/creditor
relationship.” APS Sports Collectibles, Inc. v. Sports Time, Inc., 299 F.3d 624, 629
(7th Cir. 2002) (internal quotation marks omitted). “The UFTA defines a ‘debtor’ as
‘a person who is liable on a claim.’” Id. (quoting 740 ILCS 160/2(f)). Thus, individual
defendants who were not parties to the loan transaction cannot be held liable
because of their status as insiders of a debtor corporation. Id. at 629-30 (“[Plaintiff]
fails to articulate a coherent theory why the individual defendants should be held
liable under the UFTA. . . . [S]ince none of the individual defendants in this case
was a party to the [Plaintiff’s] loan transaction, their status as debtors cannot be
established under any of the agreements.”).
GoHealth does not address this basis for dismissal in any way in its briefs.
But it does raise the related argument that the IUFTA allows personal liability
against the individual Zoom Defendants and the individual Lighthouse Defendants
by piercing the corporate veil of each corporation. Second Am. Compl. at 16, 27. In
APS Sports Collectibles, although it did not reach the merits of the argument, the
Seventh Circuit did recognize the possibility of imposing personal liability under the
IUFTA by piercing the corporate veil. 299 F.3d at 631. Here, the Court has already
determined that GoHealth has adequately pled a veil-piercing theory against
Simpson and LoConti, November 26 Order at 20, but not as to the Farros.
Accordingly, Count Six (IUFTA claim against Zoom Defendants) survives as to
Simpson and LoConti, and Count Ten (IUFTA claim against Lighthouse
Defendants) is dismissed as to Chuck Farro and Jason Farro.

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C. Count XI: Tortious Interference (Lighthouse)
Defendants next seek dismissal of GoHealth’s tortious-interference-withcontract claim against the Lighthouse Defendants.5 Under Illinois law, the
necessary elements of a tortious-interference claim are “(1) the existence of a valid
and enforceable contract between the plaintiff and another; (2) the defendant's
awareness of this contractual relation; (3) the defendant's intentional and
unjustified inducement of a breach of the contract; (4) a subsequent breach by the
other, caused by the defendant's wrongful conduct; and (5) damages.” Polyad Co. v.
Indopco Inc., 2007 WL 2893638, at *8 (N.D. Ill. Sept. 25, 2007). To adequately plead
such a claim, Illinois law requires that “[n]ot only must plaintiff allege an intention
to induce the breach, plaintiff must also allege facts indicating this intention and
may not merely rest on conclusory allegations.” Western Microtechnology, Inc. v.
Goold Elecs. Corp., 1993 WL 424244, at *2 (N.D. Ill. Oct. 19, 1993) (citing Gold v.
Wolpert, 876 F.2d 1327, 1331-32 (7th Cir. 1989)). Defendants argue that because
GoHealth has made only conclusory allegations that the Lighthouse Defendants
intentionally and unjustifiably induced Zoom to breach its contracts with GoHealth,
Count XI should be dismissed. Def.’s Br. at 14-15.
The Court agrees. The Second Amended Complaint alleges that the
Lighthouse Defendants communicated with Zoom regarding Zoom’s debts to
GoHealth (Second Am. Compl. ¶ 32), accepted Zoom’s assets as part of a “sham”
5Defendants

argue that GoHealth’s tortious-interference claim must fail as it relates to
Defendant LoConti because GoHealth had no contract with LoConti. Def.’s Br. at 14. This
argument must have been made in an abundance of caution, because GoHealth does not
actually argue that it had a contract with LoConti, nor does it allege that the Lighthouse
Defendants tortiously interfered with any such contract.

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transfer (id. ¶¶ 33-34), employed a number of Zoom employees following the
transfer (id. ¶ 40), and negotiated agreements with Zoom insurers to receive Zoom’s
commissions (id. ¶ 43). GoHealth’s supplemental brief further alleges that Chuck
Farro and Jason Farro were directly involved in negotiations between Zoom and
another potential buyer, attended meetings related to those negotiations, received
confidential email communications related to the negotiations, and were at one
point identified by LoConti as “stockholders” of Zoom. R. 96, Pl.’s Supp. Br. at 3.
Even assuming the truth of these allegations, Lighthouse’s participation in the
activities giving rise to alleged breaches of contract does not amount to intentional
and unjustified inducement of those activities. Nor has GoHealth alleged any facts
to suggest that Zoom’s actions were, in fact, caused by Lighthouse’s alleged
inducement to breach its contracts with GoHealth. At most, GoHealth has alleged
that the Lighthouse Defendants were aware of Zoom’s obligations to GoHealth and
complicit in an asset transfer that would allow Zoom to avoid those obligations. But
these facts do not support GoHealth’s conclusory allegation that “Lighthouse,
through its owners and principals Chuck Farro and Jason Farro, intentionally and
unjustifiably induced the Zoom Defendants to breach their contracts with
GoHealth.” Second Am. Compl. ¶ 164. Accordingly, GoHealth has not adequately
pled a tortious-interference claim, and Defendants’ motion to dismiss is granted as
to Count XI.

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D. Count VII: Conspiracy
Finally, Defendants argue that GoHealth’s conspiracy claim must be
dismissed because GoHealth has failed to establish a plausible independent tort
underlying that claim. Def.’s Br. at 11; see Thomas v. Fuerst, 803 N.E.2d 619, 62526 (Ill. App. Ct. 2004) (“Conspiracy is not an independent tort. Where, as here,
plaintiff fails to state an independent cause of action underlying his conspiracy
allegations, the claim for conspiracy also fails.”). As explained above, GoHealth’s
IUFTA claims survive as to Defendants Zoom, LoConti, Simpson, and Lighthouse.
Moreover, Defendants have not moved to dismiss Counts One and Two of
GoHealth’s Second Amended Complaint, alleging breaches of contract by Zoom,
Simpson, and Mendell. Because those claims may serve as the substantive claim
underlying a conspiracy claim, see Rubbermaid, Inc. v. Robert Bosch Tool Corp.,
2010 WL 3834410, at *5 (C.D. Ill. Sept. 23, 2010) (“The UFTA does not specifically
provide for a conspiracy cause of action; however, the UFTA may be supplemented
by applicable state law claims such as conspiracy and aiding and abetting. (citing
740 ILCS 160/11)); Miyano Machinery USA, Inc. v. Zonar, 1994 WL 233649, at *6
(N.D. Ill. May 23, 1994) (“Illinois does recognize a cause of action for conspiring with
a third party to breach one’s own contract.”), Defendant’s motion to dismiss Count
VII of GoHealth’s Second Amended Complaint is denied, to the extent the
underlying substantive claim remains in the case.

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IV. Conclusion
For the reasons stated above, Defendants’ motion to dismiss GoHealth’s
Second Amended Complaint [R. 72] is granted in part and denied in part: Count Six
(UFTA – Zoom) is dismissed without prejudice as to Defendant Mendell; Count
Eight (aiding and abetting breach of fiduciary duty – Lighthouse) is dismissed with
prejudice as to all Lighthouse Defendants; Count Nine (UFTA – Lighthouse) is
dismissed without prejudice as to Defendants Chuck Farro and Jason Farro; Count
Ten (Veil Piercing – Lighthouse) is dismissed without prejudice as to Defendants
Chuck Farro and Jason Farro; and Count Eleven (tortious interference with
contract – Lighthouse) is dismissed without prejudice as to all Lighthouse
Defendants. Defendants’ motion to dismiss is denied as to Count Six (UFTA – Zoom)
against Defendants Zoom, LoConti, and Simpson; Count Seven (conspiracy) as to all
Defendants; and Count Nine (UFTA – Lighthouse) as to Lighthouse.
Between this Order and the Court’s November 26 Order, the following claims
remain: Count One (breach of contract – Zoom); Count Two (Breach of Contract –
Simpson, Mendell); Count Four (Veil Piercing – LoConti, Simpson); Count Five
(indemnity – Zoom, Simpson, Mendell); Count Six (UFTA – Zoom, LoConti,
Simpson); Count VII (conspiracy – all Defendants); Count Nine (UFTA –
Lighthouse).
ENTERED:
s/Edmond E. Chang
Honorable Edmond E. Chang
United States District Judge
DATE: June 24, 2014
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