IN THE UNITED STATES DISTRICT COURT 

FOR THE NORTHERN DISTRICT OF ILLINOIS

EASTERN DIVISION

40 West Hubbard, LLC, )

Plaintiff, )

) No. 20 C 4909

v. )

) Judge Ronald A. Guzmán

RCSH Operations, Inc., d/b/a Ruth’s Chris )

Steak House, and Ruth’s Hospitality )

Group, Inc., )

Defendants. )

MEMORANDUM OPINION AND ORDER

For the reasons stated below, Defendants’ motion for judgment on the pleadings [28] is 

denied. 

 STATEMENT

Defendant Ruth’s Chris Steak House (“Ruth’s Chris”), a restaurant, stopped paying rent 

in April 2020, asserting that its space was untenantable due to COVID-19, thus relieving it of its 

obligation to pay rent. Plaintiff sued for breach of contract and breach of guaranty.

1

 Defendants 

now move for judgment on the pleadings under Federal Rule of Civil Procedure (“Rule”) 12(c). 

Facts

For purposes of a motion under Rule 12(c), the Court assumes all well-pleaded facts are 

true. On June 2, 1992, the predecessors in interest of Hubbard and Ruth’s Chris entered into a 

written lease. According to the lease, Ruth’s Chris “shall use and occupy the Premises for the 

following uses and purposes ONLY and for NO other use or purpose without the express prior 

written consent of Lessor: typical “RUTH’S CHRIS STEAK HOUSE” as shown by Lessee’s 

business data presented to Lessor immediately prior to the execution of this Lease.” (Compl., 

Ex. 1, Lease, § 13.) Section 13 of the lease is entitled “FIRE OR CASUALTY,” and the first 

subsection is entitled “Untenantability,” which states in relevant part as follows:

A. . . . . ‘[T]otal untenantability’ or ‘totally untenantable’ shall mean: . . . the 

Premises are ordered closed by relevant governmental authorities through no 

fault of Lessee . . . . Any lesser or other damage or destruction resulting from 

any such cause which allows the Premises or any substantial portion thereof to 

 1

 According to the complaint, Ruth’s Hospitality Group, Inc. is the guarantor while Ruth’s Chris 

is a party to the lease. The Court refers primarily to Ruth’s Chris in this order, but Ruth’s 

Hospitality Group, Inc. is a co-defendant in the case and also moves for judgment on the 

pleadings. 

Case: 1:20-cv-04909 Document #: 45 Filed: 04/20/21 Page 1 of 4 PageID #:534
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remain open for business, in the business judgment of the Lessee reasonably 

exercised, shall be deemed ‘partial untenantability’ or ‘partially untenantable.’

. . . 

B. Rent shall abate during untenantability. If there has been total untenantability, 

Rent shall abate in full . . . . In the case of partial untenantability, Rent shall 

abate equitably as Lessor and Lessee reasonably may agree, with Lessor and 

Lessee left with the right to seek such loss of rents or business interruption 

coverage as each may have available in such case.

(Id.) Ruth’s Chris stopped paying rent as of April 1, 2020, asserting that the premises were

untenantable pursuant to the following governmental orders, which are attached to its motion:

• On March 9, 2020, Governor Pritzker issued a COVID-19 disaster 

proclamation; 

• On March 16, 2020, Governor Pritzker issued Executive Order 2020-07, which, 

in part, required restaurants to “suspend service for and may not permit onpremises consumption” through March 30, 2020; 

• On April 1, 2020, Governor Pritzker issued Executive Order 2020-18, which, in 

part, extended the suspension of on-premises consumption at restaurants through 

April 30, 2020; 

• On April 30, 2020, Governor Pritzker issued Executive Order 2020-32, which 

provided that restaurants could operate for delivery, drive-through, curbside pickup and carry out only; 

• On May 29, 2020, Governor Pritzker issued Executive Order 2020-38, which, 

in part, prohibited “on-premises consumption, except as permitted by DCEO 

guidance”; 

• On October 29, 2020, Governor Pritzker issued Executive Order 2020-64, 

which, in part, required all Chicago restaurants to close at 11 p.m. and “suspend 

indoor on-premises consumption”; 

• On November 18, 2020, Governor Pritzker issued Executive Order 2020-73, 

which, in part, provided that restaurants “may not allow in-person indoor 

consumption,” which was extended through January 9, 2021 by Executive Order 

2020-74.

(Defs.’ Mot. J. Pleadings, Dkt. # 28, Exs. B-I.) 

Analysis

According to Ruth’s Chris, all three elements of untenantability under the lease have been 

satisfied: Both the State of Illinois and City of Chicago have ordered the dining room of Ruth’s 

Chris completely (and later partially) closed during various periods since March 2020; the State 

of Illinois and City of Chicago are “relevant governmental authorities” with authority over the 

Chicago location of Ruth’s Chris; and the orders were entered, and Ruth’s Chris was subject to 

them, through no fault of its own. According to Ruth’s Chris, whether the governmental orders 

constitute total or partial untenantability is irrelevant to the question presented on the instant 

motion because, in either circumstance, rent abates.

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From Plaintiff’s perspective, Ruth’s Chris made a business decision to permanently close 

its Chicago restaurant at the onset of the COVID-19 pandemic. Ruth’s Chris then failed to pay 

rent and later abandoned the premises and repudiated the lease. No fire or other physical 

casualty damaged or destroyed the leased premises such that it could not be occupied, and the 

Illinois Governor did not order the leased premises “closed.” According to Plaintiff:

The Orders never prohibited occupancy of any restaurant premises and 

specifically encouraged restaurants to continue to operate by providing delivery 

and take-out service. The Orders also specifically permitted customers to enter 

restaurant premises. In fact, the Orders deemed restaurants to be essential 

businesses that could continue operations throughout the pandemic lockdowns.

(Pl.’s Resp., Dkt. # 31, at 3) (citing Exec. Ord. 2020-32 § 12.l) (emphasis added by Plaintiff). 

The lease is governed by Illinois law. “In Illinois[,] a lease gives rise to the relationship 

of landlord and tenant,” and as “a type of contract . . . , it is governed by rules which govern 

contracts generally.” In re Consol. Med. Transp., Inc., 300 B.R. 435, 451 (Bankr. N.D. Ill. 2003)

(citation and internal quotation marks omitted). The “princip[al] function of the Court in 

construing a lease is to give effect to the intention of the parties as expressed in the language of 

the document when read as a whole.” Id. (citation and internal quotation marks omitted). 

Neither the terms of the lease nor the governmental orders upon which Ruth’s Chris relies 

dictate entry of judgment in its favor at this stage. As Plaintiff notes, while certain Executive 

Orders required cessation of on-premises dining, other Executive Orders allowed it to resume. 

Moreover, at least one of the orders allowed restaurants to operate for delivery, drive-through, 

curbside pick-up, and carry-out orders. See Exec. Ord. 2020-32. Given these orders, the Court 

cannot state as a matter of law on the current record that Ruth’s Chris restaurant was totally 

untenantable for the entire period starting April 1, 2020 to the present (or at least as of the date of 

the filing of the lawsuit). Ruth’s Chris contends in the alternative that the premises was partially 

untenantable, and that rent still abates during that period. But the lease provides that a 

determination of partial untentantability depends on the “business judgment of the Lessee 

reasonably exercised.” Was Ruth’s Chris’s decision to completely halt operations immediately 

at the outset of the pandemic and not engage in curbside pick-up, takeout or delivery, or inperson dining when allowed, a reasonable exercise of its business judgment? Further 

development of the record is required before that can be determined. Because these bases 

provide sufficient grounds for denying the motion, the Court need not address the other issues 

raised by the parties. 

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 Ruth’s Chris’s motion for judgment on the pleadings is denied. 

Date: April 20, 2021 

 

 ____________________________ 

 Ronald A. Guzmán 

United States District Judge

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