Greer v. Advanced Equities
2012 IL App (1st) 112458
Ill. App. Ct.2012Background
- Plaintiffs Greer and Floyd bought Pixelon stock from defendants in 1999.
- They signed a subscription agreement containing a nonreliance clause stating they relied only on the PPM and independent investigations.
- The PPM provided details about the investment; the clause disclaimed reliance on any oral representations outside the PPM.
- Plaintiffs later alleged material oral misrepresentations by defendants and filed common-law fraud claims after prior federal litigation.
- The circuit court dismissed the fraud claim under a 2-619 motion, and the case was appealed via Rule 308 certified question.
- The appellate court answered the certified question in the affirmative, holding the nonreliance clause bars justifiable reliance on oral misrepresentations in this scenario.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does a nonreliance clause bar justifiable reliance on oral misrepresentations? | Greer argues Adler should not universally apply; reliance may exist absent contradiction. | Daubenspeck/Badger contend nonreliance clauses automatically preclude justifiable reliance for oral statements. | Yes; nonreliance clause bars justifiable reliance on oral misrepresentations. |
Key Cases Cited
- Adler v. William Blair & Co., 271 Ill. App. 3d 117 (1995) (nonreliance clause defeats justifiable reliance on oral misrepresentations)
- Tirapelli v. Advanced Equities, Inc., 351 Ill. App. 3d 450 (2004) (reaffirms Adler; nonreliance clause fatal to reliance)
- Benson v. Stafford, 407 Ill. App. 3d 902 (2010) (nonreliance clause defeats reliance; Adler rule reaffirmed)
- Rissman v. Rissman, 213 F.3d 381 (2000) (federal precedent discussed; nonreliance context)
- Extra Equipamentos E Exportacao Ltda. v. Case Corp., 541 F.3d 719 (2008) (Seventh Circuit on nonreliance clause; limits in fraud context)