IA Collaborative, LLC v. Fathom Loop, LLC

CourtDistrict Court, N.D. Illinois
DecidedJune 11, 2024
Docket1:22-cv-05237
StatusUnknown

This text of IA Collaborative, LLC v. Fathom Loop, LLC (IA Collaborative, LLC v. Fathom Loop, LLC) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
IA Collaborative, LLC v. Fathom Loop, LLC, (N.D. Ill. 2024).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

IA COLLABORATIVE, LLC, ) ) Plaintiff, ) ) vs. ) Case No. 22 C 5237 ) FATHOM LOOP, LLC, ) ) Defendant. )

MEMORANDUM OPINION AND ORDER

MATTHEW F. KENNELLY, District Judge:

IA Collaborative, LLC (IA) has sued Fathom Loop, LLC alleging breach of contract. Both sides have moved for summary judgment. Background The following facts are undisputed except where otherwise noted. The dispute concerns the performance of a Master Services Agreement (the Agreement) and a Statement of Work (SOW) that the parties signed in 2022. On February 23, 2022, IA and Fathom Loop entered into an agreement under which Fathom Loop retained IA's services to support "various marketing and consulting initiatives." Pl.’s L.R. 56.1 Stmt., Ex. A at 1. On March 3, 2022, the parties signed the SOW, in which IA agreed to execute a three-phase project for Fathom Loop that would include research, product planning and design services. The SOW states that project fees will be incurred on a monthly basis based on "team hours billed" and that "approved expenses will be reimbursed in accordance with the Agreement." Pl.’s L.R. 56.1 Stmt., Ex. B at 9. The SOW also states that "[p]ayment of 25%, or $243,000 of the estimated fee is required prior to initiation of project." Id. The SOW was signed by Jeremy O'Day, Fathom Loop's Chief Technology Officer, and Tony Morello, IA's Vice President of Operations. The parties dispute whether and to what extent IA completed the work outlined in

the SOW. IA's Morello testified during his deposition that he was not involved in the day-to-day operations of the project and is unaware of the scope of the research that IA agreed to conduct. He asserted, however, that he has personal knowledge of the project's completion "as it relates to what is in the scope of work and through [his] relationship with the discipline leads." Morello Dep. at 14:9-15. Morello testified that project manager Megan O'Brien informed him that IA had submitted "most" of the deliverables defined in phase one and a "good portion" of the deliverables outlined in phase two of the project plan to Fathom Loop. Id. at 45:8-22. Morello further stated that he had not personally viewed or contributed to those deliverables. Id. at 29:8-12. Morello also said that he was not involved in reviewing the time or the amounts billed in

the invoices that IA sent to Fathom Loop. Additionally, in support of its motion, IA provides affidavits submitted by Fathom Loop's O'Day (who is no longer with that company), Fathom Loop independent contractor Sarah Reinhoff, and HiFi Inc. independent contractor Sean Maloney. O'Day states that he has "personal knowledge of a portion of the services that IA performed" for Fathom Loop, and that "the services that IA performed for [Fathom Loop] were acceptable." O'Day Aff. ¶¶ 12-13. O'Day also states that he "would have approved invoices for completed work" and that he "do[es] not know why [Fathom Loop] did not pay IA." Id. ¶¶ 14-15. Reinhoff and Maloney state that they are "not familiar with the terms of any contract or statement of work between IA and [Fathom Loop]" but assert that they are "familiar" with the services that IA performed for Fathom Loop and were "satisfied with those services." Maloney Aff. ¶ 3-4; Reinhoff Aff. ¶¶ 3-4. James Flores, the founder of Fathom Loop, testified during his deposition that he

was unfamiliar with the terms of the Agreement and SOW and that he is "unaware of what exactly IA was doing specifically with Fathom." Flores Dep. at 38:10-15, 42:2-8. Flores also stated that he relied on O'Day to advise him about the progress of IA's project and that his understanding of IA's work with Fathom Loop is based solely on information he received from O'Day, Maloney, and Peter Green, an independent contractor. Id. at 30:9-21; 46:15-24; 52:8-19. Flores asserted that at some point O'Day informed him that the work done by IA was "incomplete." Id. at 30:9-21. Additionally, Flores said that if O'Day, Maloney, and Green indicated that he should tender payment to a vendor, he would do so. Id. at 53:9-13; 55:19-56:6. Morello testified that at some point he initiated conversations with Flores

regarding the collection of payment and that Flores asked to defer Fathom Loop's payments and indicated he had "more funding on the horizon that would allow [IA] to get paid." Morello Dep. at 53:16-24. Flores confirmed during his deposition that he "inform[ed] IA that [he] was trying to line up a solution" for Fathom Loop's financial issues. Flores Dep. at 62:21-63:3. IA asserts that the total balance Fathom Loop owes IA for the performance of services pursuant to the Agreement is $329,339.80. IA has moved for summary judgment, contending that it fulfilled its contractual obligations and that Fathom Loop breached the Agreement by failing to pay IA for the services it rendered. Fathom Loop does not dispute that it made no payments to IA. Fathom Loop argues, however, that there is insufficient evidence that IA fulfilled its contractual obligations or suffered damages because of any alleged contract breach. Fathom Loop seeks summary judgment on these bases. Discussion

Summary judgment is appropriate if "the movant shows that there is no genuine dispute as to any material fact." Fed. R. Civ. P. 56(a). A genuine dispute of material fact exists only if "sufficient evidence favoring the nonmoving party exists to permit a jury to return a verdict for that party." Egonmwan v. Cook Cnty. Sheriff's Dep't, 602 F.3d 845, 849 (7th Cir. 2010) (quoting Faas v. Sears, Roebuck & Co., 532 F.3d 633, 640–41 (7th Cir. 2008)). In analyzing cross-motions for summary judgment, the Court "view[s] all facts and inferences in the light most favorable to the nonmoving party on each motion." Lalowski v. City of Des Plaines, 789 F.3d 784, 787 (7th Cir. 2015) (citation omitted). The non-moving party is "only entitled to the benefit of inferences supported by admissible evidence, not those supported by only speculation or conjecture." Grant

v. Trs. of Indiana Univ., 870 F.3d 562, 568 (7th Cir. 2017) (internal quotation omitted). 1. Fathom Loop's motion for summary judgment The parties agree that Illinois law governs the Agreement and accompanying SOW. Under Illinois law, to prevail on a breach of contact claim, the plaintiff must prove that a valid and enforceable contract existed, all conditions precedent were performed, the defendant breached the contract, and the plaintiff suffered damages because of the breach. Shubert v. Fed. Express Corp., 306 Ill. App. 3d 1056, 1059, 715 N.E.2d 659, 661 (1999). It is undisputed that the Master Agreement and SOW are valid and enforceable contracts. Fathom Loop argues that its refusal to provide payment under the contract is justified because IA has not demonstrated that it performed its contractual obligations, the parties failed to fulfill a condition precedent, and IA has not established that it is entitled to damages. a. Evidentiary objections

Prior to addressing the merits of Fathom Loop's motion for summary judgment, the Court must address the parties' various evidentiary disputes.

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Bluebook (online)
IA Collaborative, LLC v. Fathom Loop, LLC, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ia-collaborative-llc-v-fathom-loop-llc-ilnd-2024.