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Monday, March 02, 2015

Ind. Decisions - 7th Circuit decides one Indiana case today, a reversal

In Mir Iqbal v. Tejaskumar Patel (ND Ind., Moody), a 5-page opinion, Judge Easterbrook writes:

Through a closely held cor poration, Mir Iqbal bought a gasoline service station. (He al so guaranteed its debts, so we need not mention the corpora tion again.) Iqbal contracted with S-­‐‑Mart Petroleum for gaso line. Iqbal then hired Tejaskumar Patel to conduct the busi ness, ceding operational control to him. He chose Patel on the recommendation of Warren Johnson, S-Mart’s president. Patel ran the business but did not pay for the gasoline, lead ing S-­Mart to sue on the contract in an Indiana court. The court entered a judgment of more than $65,000 against Iqbal as guarantor. He did not pay, and a settlement was reached. Iqbal gave S-­Mart a note, secured by a mortgage on the business premises. When he still did not pay, a state court entered a second judgment against him, and the property was sold in a foreclosure auction.

Iqbal alleges in this federal suit that Patel and Johnson acted in cahoots to defraud him out of his business. The complaint accuses the defendants of racketeering and seeks treble damages under 18 U.S.C. §1964, part of the Racketeer Influenced and Corrupt Organizations Act (RICO). The dis trict court dismissed the complaint for want of jurisdiction, however, ruling that it is barred by the Rooker-­Feldman doc trine because it challenges the state court’s judgments. 2014 U.S. Dist. LEXIS 45385 (N.D. Ind. Mar. 27, 2014). * * *

Because Iqbal seeks damages for activity that (he alleges) predates the state litigation and caused injury independently of it, the Rooker-­Feldman doctrine does not block this suit. It must be reinstated. * * *

The judgment is reversed, and the case is remanded for further proceedings consistent with this opinion.

Posted by Marcia Oddi on March 2, 2015 01:17 PM
Posted to Ind. (7th Cir.) Decisions