IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

WEC 98C-4 LLC,

Plaintiff,

v.

SAKS INCORPORATED,

Defendant.

TOCU II LLC,

Plaintiff-Intervenor,

v.

SAKS INCORPORATED,

Defendant.

Case No. 20 C 4363

Judge Harry D. Leinenweber

MEMORANDUM OPINION AND ORDER

For the reasons stated herein, Plaintiff-Intervenor TOCU II’s 

Motion for Summary Judgment (Dkt. No. 43) is granted in part and 

denied in part. Summary judgment is granted on the issue of 

liability and the calculation of unpaid basic rent and denied as 

to the remainder of Plaintiff-Intervenor’s damages calculation. 

Defendant Saks Incorporated’s Motion pursuant to Federal Rule of 

Civil Procedure 56(d) (Dkt. No 52) is granted in part denied in 

part. Defendant is allowed discovery on the issue of damages other 

than rent due.

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 1 of 15 PageID #:1680
- 2 -

I. BACKGROUND

This case involves an attempt by the holder of a guarantee to 

recover damages, including unpaid rents, due on certain premises 

located in a shopping center in Riverside, Illinois. In June 1985, 

CPS Realty Partnership leased a portion of the Riverside shopping 

center and began operating the premises as a Carson Pirie Scott & 

Co. (“Carson’s) department store. (Def.’s Resp. to Intervenor

Pl.’s Stmt. of Facts (“DSOF”) ¶¶ 8–9, Dkt. No. 51.) Carson’s lease 

was modified in February 1994 and again in August 1998. (Id. ¶ 

10.) 

The 1998 lease amendment coincided with Plaintiff WEC 98C-4 

LLC’s purchase of the Riverside shopping center. (Mortg. Contract, 

Donahue Aff., Ex. 3, Dkt. No. 43-6.) The loan papers associated 

with WEC’s purchase assigned the right to make a claim for, 

receive, and collect all rents associated with Carson’s lease to 

the then-mortgage holder Red Mountain Funding LLC. (Assignment of 

Lease and Rents ¶ 1, Donahue Aff., Ex. 4, Dkt. No. 43-7.) The 

Assignment of Lease and Rents Agreement also directed Carson’s to 

make its rent payments under the lease directly to Red Mountain 

Funding LLC. (Id. ¶ 4.) Through a series of transactions, WEC’s 

mortgage documents for the Riverside shopping center were later 

assigned to Intervenor TOCU II LLC. (Assumption and Modification 

Agreement, Donahue Aff., Ex. 5, Dkt. No. 43-8.) 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 2 of 15 PageID #:1681
- 3 -

In August 1998, Carson’s ultimate parent company, Proffit’s, 

Inc., executed a Corporate Guaranty covering Carson’s lease at the 

Riverside shopping center. (DSOF ¶ 24.) Proffit’s is the 

predecessor-in-interest to Defendant Saks Incorporated. (Id. ¶ 5.) 

The Corporate Guaranty states in relevant part:

Guarantor hereby covenants and agrees to and with 

Landlord that if default shall at any time be made by 

Tenant in the payment of any such rent or other sums 

or charges payable by Tenant under the Lease or in 

the performance of any of the covenants, terms, 

conditions or agreements contained in the Lease, 

Guarantor will forthwith pay such rent or other sums 

or charges to Landlord, and any arrears thereof, and 

will forthwith faithfully perform and fulfill all of 

such covenants, terms, conditions and agreements, and 

will forthwith pay to Landlord all damages and all 

costs and expenses that may arise in consequence of 

any default by Guarantor hereunder (including, 

without limitation, all reasonable attorneys' fees 

incurred by Landlord or caused by any such default 

and/or by the enforcement of this Guaranty).

This Guaranty is an absolute and unconditional guaranty

of payment (and not of collection) and of performance

and is a surety agreement. Guarantor's liability

hereunder is direct and may be enforced without

Landlord being required to resort to any other right,

remedy or security and this Guaranty shall be

enforceable against Guarantor, without the necessity

for any suit or proceedings on Landlord's part of any

kind or nature whatsoever against Tenant, and without

the necessity of any notice of non-payment, nonperformance or non-observance or the continuance of

any such default or of any notice of acceptance of this

Guaranty or of Landlord's intention to act in reliance

hereon or of any other notice or demand to which

Guarantor might otherwise be entitled, all of which 

Guarantor hereby expressly waives; and Guarantor hereby

expressly agrees that the validity of this Guaranty and

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 3 of 15 PageID #:1682
- 4 -

the obligations of Guarantor hereunder shall in nowise

be terminated, affected or impaired by reason of the

assertion or the failure to assert by Landlord against

Tenant, of any of the rights or remedies reserved to

Landlord pursuant to the provisions of the Lease.

This Guaranty shall be a continuing Guaranty, and 

(whether or not Guarantor shall have notice or 

knowledge of any of the following) the liability and 

obligation of Guarantor hereunder shall be absolute 

and unconditional and shall remain in full force and 

effect without regard to, and shall not be released, 

discharged or in any way impaired by, and shall not 

be subject to any reduction, imitation, termination, 

defense, offset, counterclaim or recoupment as a 

result of (a) any amendment or modification of, or

supplement to, or extension or renewal of, the Lease 

or any assignment or transfer thereof; (b) any 

exercise or non-exercise of any right, power, remedy 

or privilege under or in respect of the Lease or this 

Guaranty or any waiver, consent or approval by

Landlord with respect to any of the covenants, terms, 

conditions or agreements contained in the Lease or 

this Guaranty or any indulgences, forbearances or 

extensions of time for performance or observance 

allowed to Tenant or Guarantor from time to time and 

for any length of time; (c) any increase in, addition 

to, exchange or release of, or non-perfection of any 

lien on or security interest in, any collateral or any 

release or amendment or waiver of or consent to any 

departure from or failure to enforce any other 

guarantee, for all or any of the Obligations; (d) any 

bankruptcy, insolvency, reorganization, arrangement,

readjustment, composition, liquidation, dissolution or 

similar proceeding relating to Tenant, or its

properties, or Guarantor including, without limitation, 

rejection of the Lease or guaranteed Obligations in

such bankruptcy; . . .

(Corporate Guaranty at 1–2, Compl., Ex. 4, Dkt. No. 1-4.) 

In April 2017, Saks executed a Guarantor Estoppel 

Certificate that provides “To the best of Guarantor’s knowledge 

the Corporate Guaranty . . . is in full force and effect.” (DSOF 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 4 of 15 PageID #:1683
- 5 -

¶ 32.) Less than a year later in February 2018, Carson’s immediate 

parent company, Bon-Ton Stores, filed for bankruptcy protection in 

Delaware Bankruptcy Court. (Id. ¶ 33.) At that time Carson’s

discontinued payment of all rent and later rejected the lease in 

the bankruptcy proceeding. (Id. ¶¶ 36–37.) Pursuant to the 

Corporate Guaranty, WEC notified Saks of Carson’s default and 

demanded that Saks honor its obligations. (Id. ¶ 34.) Saks did not 

make any payments to WEC in response to these communications.

In September 2018, TOCU commenced a mortgage foreclosure 

proceeding on the Riverside shopping center in the Circuit Court 

of Cook County. (Id. ¶ 39.) In connection with the foreclosure 

proceedings, TOCU sought and received the appointment of a receiver 

for the premises. (Id. ¶ 40.) The Cook County Court later granted 

TOCU a judgment of foreclosure. (Id. ¶ 42.)

In July 2020 WEC filed a Complaint in this Court against Saks 

for unpaid rent. (Dkt. No. 1.) In October 2020, the Court allowed 

TOCU to intervene to sue Saks on the Guaranty. (Dkt. No. 22.) In 

December 2020, the Court denied Saks’s Motions to Dismiss the 

Complaint and the Complaint in Intervention. (Dkt. No. 32.) In 

March 2021, the Court denied Saks’ Motion for Certification of an 

Interlocutory Appeal. (Dkt. No. 42.) TOCU now moves for summary 

judgment. (Dkt. No. 43.) Saks in response asks the Court to refuse 

to grant summary judgment or continue its ruling pending further 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 5 of 15 PageID #:1684
- 6 -

discovery, pursuant to Federal Rule of Civil Procedure 56(d). (Dkt. 

No. 52.) 

II. LEGAL STANDARD

Summary judgment is appropriate if there is “no genuine 

dispute of material fact and the movant is entitled to judgment as 

a matter of law.” FED. R. CIV. P. 56(a). A fact is “material” when 

identified by substantive law as affecting the outcome of the suit. 

Bunn v. Khoury Enters., Inc., 753 F.3d 676, 681 (7th Cir. 2014). 

An issue is genuine when the evidence presented is such that a 

reasonable jury could return a verdict for the nonmoving party. 

Id. at 681–82. When reviewing the record on a summary judgment

motion, the Court must view the facts and draw reasonable 

inferences in the light most favorable to the nonmoving party. 

Scott v. Harris, 550 U.S. 372, 378 (2007). If, however, the factual 

record cannot support a rational trier of fact to find for the 

non-moving party, summary judgment is appropriate. Bunn, 753 F.3d 

at 682.

Rule 56(d) also provides that if the non-movant “shows by 

affidavit or declaration that, for specified reasons, it cannot 

present facts essential to justify its opposition” the Court may 

defer its consideration of the motion for summary judgment, allow 

time for proper discovery or issue any other appropriate order. 

FED. R. CIV. P. 56(d). “The mere fact that discovery is incomplete 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 6 of 15 PageID #:1685
- 7 -

is not enough to prevent summary judgment.” Smith v. OSF HeathCare 

Sys., 933 F.3d 859, 864 (7th Cir. 2019). Instead the non-moving 

party must present an affidavit or declaration setting out the 

“specific reasons discovery should be extended, which requires 

more than a fond hope that more fishing might net some good 

evidence.” Id. The decision to grant or deny discovery is committed 

to the Court’s discretion. Becker v. Internal Revenue Serv., 34 

F.3d 398, 405 (7th Cir. 1994).

III. DISCUSSION

TOCU’s Complaint in Intervention alleges a single count of 

breach of contract against Saks. (Intervention Compl. at 6, Dkt. 

No. 23.) The Court evaluates TOCU’s Motion for Summary Judgment 

and Sak’s Rule 56(d) Motion in two parts, first on the issue of 

liability and then damages. For the reasons set forth below the 

Court grants TOCU’s motion for summary judgment on the issue of 

liability. As to damages, the Court grants summary judgment in 

favor of TOCU on the issue of rent due, but grants Saks’ Rule 56(d) 

Motion on the issue of damages other than unpaid rent.

A. Liability Under the Contract

At the outset, TOCU contends that Saks violated Federal Rule 

of Civil Procedure 8(b) and Local Rule 56.1 in its Answer to TOCU’s 

Complaint in Intervention and its Answers to TOCU’s Rule 56.1 

statement of facts by taking the position that these allegations 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 7 of 15 PageID #:1686
- 8 -

and statements called for the admission of legal conclusions and 

thus there was no obligation to admit or deny them. Saks’ position 

on this thorny issue is one that this Court and others have 

wrestled with many times. Unfortunately, there is no decision from 

the Court of Appeals to guide the lower courts, and there are 

District Court decisions going both ways. Compare Fetzer v. Walmart 

Stores, Inc., 2016 WL 792296, at *8 (N.D. Ill. Mar. 1, 2016)

(disregarding legal arguments and conclusions in Rule 56.1 

statements)with State Farm Mut. Ins. Co. v. Riley, 199 F.R.D. 276, 

278–79 (N.D. Ill. 2001) (holding that parties must respond to legal 

conclusions in pleadings).

The Court does not need to decide the appropriateness of Saks’ 

responses. The Motion for Summary Judgment filed in this case will 

be decided on legal conclusions the Court will draw from the

language employed in the Corporate Guaranty because Saks admits 

that “the language of the Guaranty is not in dispute.” (Opp’n at 

3, Dkt. No. 47.) Saks may present arguments regarding the 

interpretation of the Corporate Guaranty, but the contract’s 

interpretation, including whether there is any ambiguity in its 

terms, is a legal conclusion for the Court to make.

TOCU argues that under the plain language of the Corporate 

Guaranty Saks is a guarantor and was obligated to assume Carson’s 

lease obligations. In response Saks argues that it is both a surety 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 8 of 15 PageID #:1687
- 9 -

and a guarantor and its liability under the Corporate Guaranty is 

measured by Carson’s liability, which is now zero following the 

company’s rejection of the Riverside shopping center lease in 

bankruptcy. The Illinois Supreme Court has recognized the 

difference between sureties and guarantors: “[a] surety is an 

insurer of the debt or obligation, while a guarantor is an insurer 

of the ability or the solvency of the principal.” JPMorgan Chase 

Bank, N.A. v. Earth Foods, Inc., 939 N.E.2d 487, 495 (Ill. 2010). 

The liability of a surety “is measured by the liability of its 

principal.” Village of Rosemont v. Lentin Lumber Co., 494 N.E.2d 

592, 602–03 (Ill. App. Ct. 1986). A guarantor’s liability on the 

other hand is “determined from the instrument of guaranty.” Du 

Quoin State Bank v. Daulby, 450 N.E.2d 347, 348 (Ill. App. Ct. 

1983). An action for recovery under a guaranty is separate from 

the remedies against the original debtor. Id.

This Court on two prior occasions, specifically the December 

7, 2020 Order denying Saks’ Motions to Dismiss and the March 2, 

2021 Order denying Saks’ Motion for Leave to Appeal, has held that 

under the clear and unambiguous terms of the Corporate Guaranty

Saks is a guarantor. WEC98C-4 LLC v. Saks Inc., 2020 WL 7183745, 

at *3 (N.D. Ill. Dec. 7, 2020) (“WEC98C-4 I”); see also WEC 98C4, LLC v. Saks, Inc., 2021 WL 5033463, at *2 (N.D. Ill. Mar. 2, 

2021) (“WEC98C-4 II”). Consistent with these prior opinions, the 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 9 of 15 PageID #:1688
- 10 -

Court continues to hold that Saks is a guarantor and any contrary 

holding flies in the face of the clear, unambiguous wording of the 

Corporate Guaranty and Illinois law. As the Court stated in its 

prior ruling denying Saks’ Motion to Dismiss:

To argue that a tenant’s release somehow releases the 

guarantor from an obligation to pay rent due completely 

misstates the role of the guarantor under the clear terms 

of the Lease Guaranty in this case. The main purpose of 

having a guarantor is to protect the holder of the 

guaranty in the event that the principal cannot make 

required payments.

WEC98C-4 I, 2020 WL 7183745, at *4. Whether the Corporate Guaranty 

also designates Saks as a surety and bestows another set of 

benefits and burdens does not alter its obligations to perform as 

a guarantor under the clear and unambiguous language of the 

contract. Carson’s default on the Riverside shopping center lease 

triggered Sak’s obligation to “pay such rent or other sums or 

charges to Landlord, and any arrears thereof.” (Corporate Guaranty 

at 1–2.) Saks’ failure to make such payments has therefore breached

the express terms of the Corporate Guaranty.

The Court’s ruling on Saks’ Motions to Dismiss also held that 

none of Saks’ asserted affirmative defenses, i.e., lack of 

standing, waiver, impossibility, and failure to mitigate were 

legitimate. WEC98C-4 I, 2020 WL 7183745, at *3–*4. Saks renews 

each of these affirmative defenses but fails in its Response Brief 

and Statement of Additional Facts to present any new arguments as 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 10 of 15 PageID #:1689
- 11 -

to why the Court’s prior reasoning should not continue to hold 

sway.

First Saks continues to pursue its claim that TOCU failed to 

mitigate its damages, a claim that this Court previously described 

as “dubious.” Id. In support of this argument Saks cites the 

Illinois statute, 735 ILCS 5/9-213.1, which requires a landlord to 

take reasonable measures to mitigate damages after it has taken 

possession of the leased premises. But Saks fails to cite any case 

in which this provision was held applicable against a guarantor.

Even if the statute applied to a guarantor, TOCU sought and was 

granted a receiver for the Riverside shopping center by the Cook 

County Court overseeing the foreclosure proceedings. There is no 

case law cited by Saks that holds that actions of a court-appointed 

receiver, who reports to the appointing court for approval of its 

activities, does not constitute mitigation under the Illinois 

statute.

Saks also renews its argument that the transformation of the 

Riverside shopping center has frustrated the purpose of Carson’s 

lease. The Court previously considered this argument and cited the 

2017 Guarantor Estoppel Certificate as foreclosing this argument.

WEC98C-4 I, 2020 WL 7183745, at *4. Saks issued the Guarantor 

Estoppel Certificate, expressly certifying to Plaintiff that the 

lease guaranty remained in full force and effect as of 2017, which 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 11 of 15 PageID #:1690
- 12 -

was long after the so-called transformation that Saks describes 

occurred. While additional alleged transformative events may have 

happened after the Guarantor Estoppel Certificate was executed, 

these occurrences do not change the Court’s conclusion that Saks 

has failed to establish even a prima facie case for the affirmative 

defenses of impossibility or frustration of purpose.

Saks’ last defense to TOCU’s Motion for Summary Judgment is 

its waiver argument. According to Saks, the failure of WEC and 

TOCU to make claims with the Bankruptcy Court for the defaulted 

rent after Carson’s was allowed to reject the lease constitutes a 

waiver of a claim for rent. The Court said in its previous ruling

that:

This argument also flies in the face of the clear 

language of the Lease Guaranty. The Lease Guaranty 

indicates, “the liability and obligation of Guarantor 

hereunder shall be absolute and unconditional . . . and 

shall not be released, discharged or in any way impaired 

by . . . (d) any bankruptcy . . . relating to Tenant . 

. . including, without limitation, rejection of the 

Lease . . ..” (Lease Guaranty at 2.) Under the clear 

terms of the Lease Guaranty, this argument fails.

Id. The Court has also noted that, under Seventh Circuit law, a 

creditor’s failure to file a claim in bankruptcy does not bar 

subsequent recovery from the bankrupt debtor’s insurers. WEC 98C4 II, 2021 WL 5033463, at *3 (citing Matter of Fernstrom Storage 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 12 of 15 PageID #:1691
- 13 -

& Van Co., 938 F.2d 731, 733 (7th Cir. 1991)). The Court reaffirms 

these conclusions.

For all these reasons, the Court concludes Saks’ failure to 

make the rental payments due under the Carson’s lease after the 

store defaulted constitutes breach of the Corporate Guaranty. 

Because there is no issue of material fact on this issue, the Court 

grants summary judgment in favor of TOCU on the issue of liability. 

B. Damages

Having determined that Saks is liable under the Corporate 

Guaranty, the Court turns to the issue of damages. Saks attempts 

to resist summary judgment by arguing that there is a question of 

fact regarding the proper beneficiary of the rights under the 

Corporate Guaranty. But the Court has already concluded that WEC 

“assigned all of its interest in the [Guaranty Contract] to TOCU.”

WEC98C-4 I, 2020 WL 7183745, at *4. The remaining question for 

WEC, which is not the subject of this Motion for Summary Judgement, 

is whether it is entitled to consequential damages incurred as a 

result of Carson’s lease default. Id.

The present Motion deals with the damages due pursuant to the 

Corporate Guaranty. Under the Corporate Guaranty TOCU is seeking 

over $6,527,454.50 in damages as of February 28, 2021 plus interest

on this sum. This amount is considerably higher than the amount of 

basis rent alleged to be due as of February 28, 2021 ($2,949,225). 

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 13 of 15 PageID #:1692
- 14 -

Saks does not dispute the calculation of basis rent from August 

31, 2018 through February 28, 2021. (DOSF ¶ 44.) The Court 

therefore concludes there is no issue of material on TOCU’s basic 

rent calculation. TOCU is therefore entitled to $2,949,225, as 

well as the additional months of basic rent due during the pendency 

of this motion. 

The remainder of TOCU’s damages claims are not liquidated. 

The Court agrees that additional discovery is needed to establish 

these amounts. The Court will therefore allow the Defendant to 

pursue discovery on the issue of the unliquidated damage claims.

V. CONCLUSION

For the reasons stated herein, TOCU’s Motion for Summary 

Judgment on the issue of liability is granted. Judgment is entered 

in favor of TOCU on the issue of basic rent due in the amount of 

$2,949,225.00, plus the additional months of basic rent due during 

the pendency of this motion.

The Motion pursuant to Rule 56(d) is denied in part and 

granted in part. Defendant is allowed discovery on the issue of 

damages other than rent due.

IT IS SO ORDERED.

Harry D. Leinenweber, Judge

United States District Court

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 14 of 15 PageID #:1693
- 15 -

Dated: 11/12/2021

Case: 1:20-cv-04363 Document #: 63 Filed: 11/12/21 Page 15 of 15 PageID #:1694