The opinion of the court was delivered by: Hillman, District Judge
This matter has come before the Court on plaintiff's motion for partial summary judgment on its breach of contract claim against defendants William Kwasnik, Michael W. Kwasnik, Michael Erhard, and OPIS Management Fund LLC, as well as plaintiff's motion to dismiss defendants' counterclaims. For the reasons expressed below, plaintiff's motions will be granted.
In June 2009, plaintiff Westdale Construction Company, Ltd. commenced a breach of contract action in this Court against Liberty State Benefits of Pennsylvania, Inc. ("Liberty Benefits") and Liberty State Financial Holdings Corporation ("Liberty Financial"), captioned Westdale Construction, Ltd. v. Liberty State Benefits of Pennsylvania, Inc. et al., Civ. Action No. 09-2973 (NLH)(JS). There, Westdale claimed that it had entered in a contract to loan Liberty Benefits $2,306,120.00 in order to purchase the beneficial interests in certain irrevocable life insurance trusts ("ILLTs"). The loan was to be repaid at 5% interest per month, no later than March 2009. By the end of March 2009, however, Liberty Benefits had failed to repay Westdale's loan. Westdale then filed suit against the Liberty defendants.
After several hearings, the appointment of an independent trustee to investigate the irrevocable life insurance trusts at issue, a referral of the matter to the United States Attorney's Office, and the imposition of a prejudgment writ of attachment, this Court granted Westdale's motion for summary judgment on its breach of contract claim against Liberty Benefits, and entered judgment in its favor in the amount of $4,151,016.00. During the pendency of the remaining claims, the parties reached a global settlement, and the case was closed.
In this instant matter, Westdale claims that defendants have failed to honor their obligations under the settlement agreement in the prior case. According to Westdale's complaint, under the parties' written settlement agreement, the parties agreed to a $2.9 million settlement, which the settling defendants would pay in installments within 90 days. The settlement payments were personally guaranteed by individual guarantors--defendants William Kwasnik, Michael Kwasnik, and Michael Erhard--who agreed to the entry of a consent judgment against them in the amount of $4,100,000 in the event of a default on the settlement payment terms. OPIS Management Fund LLC also pledged four million shares of its stock in Nutra Phrama Corporation as collateral for payment under the settlement agreement.
Westdale now claims that the settling defendants failed to pay it more than $2 million of the $2.9 settlement by the payment deadline.*fn1 Westdale also claims that OPIS failed to pledge its collateral stock. Westdale claims that the settling defendants are now in default, and it is owed $4.1 million plus the collateral stock, along with various fees and costs.
Because the Liberty defendants have since filed for bankruptcy protection, Westdale filed suit against the individual guarantors and OPIS for breach of contract, among other claims.*fn2
The individual guarantors and OPIS filed counterclaims against Westdale for fraudulent inducement, fraud and civil conspiracy.
Through its current motions, Westdale seeks the entry of its consent judgment against the individual guarantors, and the dismissal of defendants' counterclaims. The defendants have opposed Westdale's motions.*fn3
This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1332 because there is complete diversity of citizenship between the parties and ...