1

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

JOSEPH LEVATO and ANGELA 

LEVATO,

Plaintiffs,

v.

MARY A. O’CONNOR, 

individually and as Trustee for 

the Mary A. O’Connor Trust dated 

March 23, 2000, MARY A. 

O’CONNOR TRUST dated March 

23, 2000, GALE G. ACKER, 

individually and as Trustee for 

the Gale G. Acker Trust dated 

March 23, 2000, and GALE G. 

ACKER TRUST dated March 23, 

2000,

Defendants.

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

)

No. 20 C 1999

Magistrate Judge

Maria Valdez

MEMORANDUM OPINION AND ORDER

This matter is before the Court on Defendants’ Motion for Partial Summary 

Judgment on Count Three of Plaintiffs’ Amended Complaint [Doc. No. 58]. For the 

reasons that follow, Defendants’ motion is denied.1

BACKGROUND

Plaintiffs Joseph Levato and Angela Levato brought this diversity action 

pursuant to Illinois common law and the Illinois Residential Real Property 

1 The parties have consented to the jurisdiction of the United States Magistrate Judge 

pursuant to 28 U.S.C. § 636(c).

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 1 of 11 PageID #:414
2

Disclosure Act (“RRPDA” or the “Act”). 765 ILCS 77/1, et seq. Plaintiffs’ Amended 

Complaint seeks either recission or damages based upon alleged fraud in the sale of 

real property located in Prospect Heights, Illinois (the “Property”). The major thrust 

of the Amended Complaint is that Defendants, which owned and sold the Property

to Plaintiffs, had knowledge of major defects but did not disclose those defects to

Plaintiffs prior to their purchase. Pertinent here, Plaintiffs have alleged that 

Defendants had knowledge of chronic defects in the drain tile system, including 

“[t]he presence of iron bacteria” which “cause[d] the accumulation of a thick, rustcolored slime that fills and clogs drains, pipes, and sump pumps.” (Am. Compl. ¶ 

27.) Count III of the Amended Complaint is brought pursuant to the RRPDA and 

alleges that Defendants violated the Act by, inter alia, not disclosing the iron 

bacteria condition. Defendants now move for partial summary judgment “on the 

portion of Count Three regarding iron bacteria.” (Defs.’ Mot. at 1.)

DISCUSSION

I. FACTS

The facts pertinent to the instant motion as set forth by the parties are brief 

and almost entirely undisputed. On April 27, 2019, Defendants listed the subject 

Property for sale. (Defs.’ LR 56.1 Statement at ¶ 6.) As part of that listing, 

Defendants executed a Residential Real Property Disclosure Report (“Disclosure 

Report”) on April 28, 2019. (Id.) Defendants provided a copy of the Disclosure 

Report to Plaintiffs. (Pls.’ LR 56.1 Statement at ¶ 23.) The parties entered into a 

sale contract on April 29, 2019, and they closed on the sale of the Property on May 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 2 of 11 PageID #:415
3

30, 2019. (Defs.’ LR 56.1 Statement at ¶ 7.) On November 30, 2019, Plaintiffs 

discovered rust-colored sludge seeping up through multiple gaps of the cement floor 

of the basement and learned of a recurring presence of iron bacteria in the 

Property’s drain tile system and sump pumps. (Pls.’ LR 56.1 Statement at ¶ 24.)

Prior to selling the Property, Defendants had knowledge of the presence of 

iron bacteria in the drain tile system. (Pls.’ LR 56.1 Statement at ¶ 15.) Defendants’ 

Disclosure Report for the Property did not refer to or disclose the presence of iron 

bacteria. (Defs.’ LR 56.1 Statement at ¶ 6.) Further, in their Disclosure Report, 

Defendants checked “NO” indicating that they were not “aware of material defects 

in the plumbing system (includes such things as water heater, sump pump, water 

treatment system, sprinkler system and swimming pool).” (Id. at ¶ 11.)

Iron bacteria are small living organisms that naturally occur in soil, shallow 

groundwater, and surface waters, and they produce a gelatinous slime that builds 

up over time. (Defs.’ LR 56.1 Statement at ¶ 13; Pls.’ LR 56.1 Statement at ¶ 16.)

The iron bacteria condition at the Property cannot be eliminated. (Id. at ¶ 19.) In 

order to effectively combat the iron bacteria, the Property’s pipes must be “jetted” at 

regular intervals. (Defs.’ LR 56.1 Statement at ¶ 14.) Prior to selling the Property, 

Defendants had the drain tile system jetted twice per year to deal with iron bacteria 

buildup. (Pls.’ LR 56.1 Statement at ¶ 18.)

II. LEGAL 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 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 3 of 11 PageID #:416
4

matter of law.” Fed. R. Civ. P. 56(a). A dispute of material fact is genuine “if the 

evidence is such that a reasonable jury could return a verdict for the nonmoving 

party.” Zaya v. Sood, 836 F.3d 800, 804 (7th Cir. 2016) (quoting Anderson v. Liberty 

Lobby, Inc., 477 U.S. 242, 248 (1986)). Accordingly, “[t]he mere existence of a 

scintilla of evidence in support of the non-moving party’s position will be 

insufficient.” Johnson v. Doughty, 433 F.3d 1001, 1009-10 (7th Cir. 2006) 

(quotations and alterations omitted).

III. ANALYSIS

The resolution of the instant motion requires that this Court construe the 

pertinent provisions of the RRPDA. The fundamental rule of statutory construction 

is to ascertain and effectuate the legislature’s intent. Comprehensive Community 

Solutions, Inc. v. Rockford Sch. Dist. No. 205, 837 N.E.2d 1, 11 (Ill. 2005).2 The 

plain language of the statute remains the best indication of that intent. Id. When 

the statutory language is clear and unambiguous, a court may not depart from the 

plain language and meaning of the statute by reading into it exceptions, limitations, 

or conditions that the legislature did not express. Lawler v. Univ. of Chicago Med. 

Ctr., 104 N.E.3d 1090, 1094 (Ill. 2017). A statute is viewed as a whole. In re 

2 As this Court is sitting in diversity and construing an Illinois statute, it is to apply the 

rules of statutory construction as enunciated by Illinois state courts. See Doe v. A.J. Boggs 

& Co., No. 1:18-cv-01464, 2019 U.S. Dist. LEXIS 60521, at *5 (E.D. Cal. Apr. 5, 2019) 

(“When a federal court sitting in diversity interprets a state statute, it must apply state 

rules of statutory construction.”) (citations omitted); Senderra Rx Partners, LLC v. Blue 

Cross & Blue Shield of N.C., No. 1:18-CV-871, 2021 U.S. Dist. LEXIS 65338, at *9 

(M.D.N.C. Apr. 5, 2021) (“The Court – sitting in diversity – applies state law principles of 

statutory construction, as enunciated and applied by the North Carolina Supreme Court.”) 

(citation omitted).

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 4 of 11 PageID #:417
5

Marriage Dahm-Schell, – N.E.3d –, No. 126802, 2021 Ill. LEXIS 982, at *12 (Ill. 

Nov. 18, 2021). Therefore, words and phrases are construed considering other 

relevant statutory provisions and not in isolation. Chicago Teachers Union, Local 

No. 1 v. Bd. of Educ. of the City of Chicago, 963 N.E.2d 918, 923 (Ill. 2012). Each 

word, clause, and sentence of a statute must be given a reasonable meaning, if 

possible, and should not be rendered superfluous. Id. A court may also consider the 

reason for the law, the problems sought to be remedied, the purposes to be achieved, 

and the consequences of construing the statute one way or another. Id.

Pursuant to the RRPDA, a seller of residential real property “shall disclose 

material defects of which the seller has actual knowledge.” 765 ILCS 77/25(b). The 

Act defines “material defect” to mean “a condition that would have a substantial 

adverse effect on the value of the residential real property or that would 

significantly impair the health or safety of the future occupants of the residential 

real property.” 765 ILCS 77/35. The statute requires that “[a] seller of residential 

real property shall complete all applicable items in the disclosure document 

described in Section 35 of [the] Act.” 765 ILCS 77/20. Section 35 of the RRPDA calls 

the disclosure document a “Residential Real Property Disclosure Report.” 765 ILCS 

77/35. The statute explains that the “purpose of [the] report is to provide 

prospective buyers with information about material defects in the residential real 

property.” Id. In the report, the seller must indicate, inter alia, whether they are 

“aware of material defects in the plumbing system [which] []includes such things as 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 5 of 11 PageID #:418
6

water heater, sump pump, water treatment system, sprinkler system, and 

swimming pool.” Id.

As characterized by Defendants, “the only question before the court is 

whether the iron bacteria referred to in the Complaint is a ‘material defect’ to the 

plumbing system, defined in the statute as ‘such things as water heater, sump 

pump, water treatment system, sprinkler system and swimming pool.’” (Defs.’ Reply 

at 1.) The Court does not entirely agree with that exact formulation, and 

Defendants’ motion would fail if that was in fact the precise question presented.

Indeed, as pointed out by Plaintiffs, whether a defect is “material” – in that it has

“substantial adverse effect on the value” of the property or poses a health risk to 

occupants – would generally involve questions of fact to be determined at trial. See 

Sgariglia v. Am. Int’l Relocation Servs., No. 19-cv-5684, 2021 U.S. Dist. LEXIS 

176352, at *30 (N.D. Ill. Sep. 16, 2021) (“But if this case were to go to trial, the trier 

of fact would be required to determine if the defects identified by Plaintiff are ones 

that ‘have a substantial adverse effect on the value of’ the Unit or that ‘significantly 

impair the health or safety of future occupants of’ the Unit.”) (citations omitted). As 

such, in this case, the “materiality” of the condition at issue cannot be adjudicated 

pursuant to Defendants’ instant motion, particularly based on the factual record 

before the Court which does not include any evidence pertaining to the actual cost of 

remediating the iron bacteria condition. The Court believes that the immediate 

question posed by Defendants’ motion is whether the iron bacteria condition as 

manifested at the subject Property is a type of condition that Defendants were 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 6 of 11 PageID #:419
7

obligated to disclose pursuant to the RRPDA’s requirement that defects in a 

“plumbing system” be disclosed. As framed by Plaintiffs, the question presented is 

“whether the presence of iron bacteria in a drain tile system and sump pumps is 

encompassed by the disclosure requirements of the [RRPDA].” (Pls.’ Resp. at 1.) It 

does not appear that any court has previously considered the issue of whether iron 

bacteria must be disclosed under the RRPDA.

As stated above, Plaintiffs have alleged generally that Defendants failed to 

disclose chronic defects in the drain tile system at the subject Property. Troublingly, 

neither party has set forth any facts in their respective statements of fact 

explaining precisely what a drain tile system is, nor any facts demonstrating what 

specific drain tile system is employed at the Property. For the first time in their 

reply brief, Defendants maintain that a drain tile system “is a perforated pipe that 

surrounds a home and, thereby, prevents water from infiltrating the home.” (Defs.’ 

Reply at 2.) Defendants also assert for the first time in their reply brief that a drain 

tile system “involves pipes and water, but is otherwise completely separate from the 

home’s plumbing system.” (Id.) The Court need not (and does not) accept 

Defendants’ latter assertion. See Phillips v. Quality Terminal Servs., Ltd. Liab. Co., 

855 F. Supp. 2d 764, 784 n.11 (N.D. Ill 2012) (“Merely including facts in a 

responsive memorandum is insufficient to put the issue before the Court. . . . 

Adherence to Local Rule 56.1 gives the opposing party the opportunity to either 

admit or deny the statement of fact, and to provide record support for either 

assertion. By not following the rule, a party injects facts into the case that have not 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 7 of 11 PageID #:420
8

been subject to the opposing side’s scrutiny, nor presented to the court for its 

review. The Court will not accept facts referenced in Plaintiff’s memorandum that 

are not set forth in his statement of facts.”) (citations omitted). The Court’s 

independent research reveals that drain tile systems are generally comprised of 

subterranean drainage pipes designed to protect homes from groundwater flooding 

by redirecting water away from the home before it can enter and cause damage.

Drain tile systems can be either internal or external, with internal systems being 

installed under a building’s foundation and external systems being installed around 

the perimeter of a building below the level of the floor slab. The record before the 

Court provides no indication of whether the drain tile system at the subject 

Property is internal or external, and, again, it does not provide any other specifics 

regarding the drain tile system at issue.

In any event, findings as to the precise nature of drain tile systems or the 

specifics of the drain tile system at the subject Property are not necessary to an 

adjudication of the instant motion. That is because Defendants have unequivocally

admitted that “[i]ron bacteria produces a gelatinous slime that builds up over time,” 

that they “had knowledge of the presence of iron bacteria in the drain tile system,” 

and that “[t]he iron bacteria was present in the sump pumps.” (Defs.’ Resp. to Pls.’ 

LR 56.1 Statement at ¶¶ 15-17 (emphasis added); Defs.’ Reply at 1 (“Defendants 

here have admitted that they were aware of recurring iron bacteria sludge in the 

basement drain tile pipes and sump pump that builds up to be a gelatinous slime 

over time, and that they therefore jet the drain tile system twice per year in order to 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 8 of 11 PageID #:421
9

mitigate it.”).) Further, Defendants themselves asked Plaintiffs to admit (and 

Plaintiffs admitted) that iron bacteria form “a slimy material that sticks the 

bacteria to well pipes, pumps, and plumbing fixtures.” (Doc. No. 58-4 at ¶ 6 

(emphasis added).) As set forth above, the RRPDA (and Defendants’ Disclosure 

Report made pursuant to the Act) specifically delineates a “plumbing system” to 

include a “sump pump.” 765 ILCS 77/35. Accordingly, as the iron bacteria are

plainly a condition “in” (within the bounds of) the “sump pump” and “plumbing 

fixtures,” they are a type of defect that Defendants had an obligation to disclose 

pursuant to the Act’s plain language. As discussed above, whether the iron bacteria 

condition in this case substantially impacts the value of the Property or poses a 

health risk is a question for another day.

In support of their motion, Defendants rely almost exclusively on the decision 

in Kalkman v. Nedved, 991 N.E.2d 889 (Ill. App. Ct. 2013). In that case, the 

defendants sold a home to the plaintiffs and the defendants’ RRPDA disclosure 

report indicated that they were not “aware of material defects in the walls or floors.” 

Id. at 891. However, the defendants did not disclose that there were considerable 

defects in the home’s windows and doors (that caused serious flooding problems). Id.

at 890. The Kalkman court framed the question presented as “whether sellers must 

disclose material defects with a home’s windows and doors under the [RRPDA’s] 

obligation to disclose defects with a home’s ‘walls.’” Id. at 892. The court noted that 

the RRPDA-mandated disclosure report “contains 23 listed items which call for the 

sellers of residential real property to disclose whether they know of a specified 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 9 of 11 PageID #:422
10

material defect or other condition in the home.” Id. at 891. The court further noted 

that “on item six of the disclosure report[] sellers must certify whether they are 

‘aware of material defects in the walls or floors.’” Id. at 893.

In holding that the defendants were not obligated to disclose defects in the 

windows and doors, the Kalkman court found that a plain definition of “walls” did 

not encompass windows or doors within a wall. The court further reasoned as 

follows:

[U]nder the maxim expressio unius est exclusio alterius, meaning the 

“expression of one thing is the exclusion of another,” we infer that when 

a statute lists the things to which it applies, the omissions should be 

understood as exclusions. . . . Here, the legislature chose to enumerate 

23 conditions or defects which a seller must disclose, but windows or 

doors are not specifically mentioned. This implies that the legislature 

did not intend for those features of a property to be covered by the 

disclosure report.

Id. at 894 (citations omitted). This Court finds Kalkman (and its rationale based on 

expressio unius est exclusio alterius) clearly inapposite to the case at bar. The 

Kalkman court ultimately characterized the situation before it as “whether a seller 

must disclose a defect not specifically mentioned in the disclosure report.” Id. at 

895. In that regard, the situation in Kalkman is effectively the opposite of the 

situation in the present case, as the RRPDA does specifically mention defects in a 

home’s “plumbing system” and “sump pump.” 765 ILCS 77/35. This Court does not 

read Kalkman to stand for the proposition that a particular type of defect – here, 

iron bacteria – need be specifically listed in the RRPDA in order to fall under the 

statute’s disclosure requirements regarding plumbing systems. Ultimately, since 

sump pumps are apparatuses specifically mentioned in the RRPDA as part of 

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 10 of 11 PageID #:423
11

plumbing systems, Kalkman is distinguishable and does not provide a basis for 

awarding Defendants partial summary judgment.

CONCLUSION

Ultimately, the Court concludes that an indisputably irreparable condition 

that continually produces rust-colored sludge that clogs a home’s plumbing fixtures

and sump pumps fits within the disclosure requirements of the RRPDA by any 

reasonable interpretation of the statute’s plain terms. Accordingly, Defendants’ 

Motion for Partial Summary Judgment on Count Three of Plaintiffs’ Amended 

Complaint [Doc. No. 58] is denied.

SO ORDERED. ENTERED:

 

DATE: December 3, 2021 ___________________________

HON. MARIA VALDEZ

United States Magistrate Judge

Case: 1:20-cv-01999 Document #: 65 Filed: 12/03/21 Page 11 of 11 PageID #:424