United Central Bank v. KMWC 845, LLC, 800 F.3d 307

In 2005 Mutual Bank made loans to appellees secured by three mortgages (Mortgages I, II, III) on Wisconsin properties; the borrowers defaulted in 2008.
Mutual Bank was closed in 2009; FDIC, as receiver, sold the notes and mortgages to United Central Bank (UCB).
UCB sued in 2011 to foreclose the three mortgages. Appellees moved for summary judgment on all three counts; cross-motions were filed.
The district court applied Illinois law to Mortgage I and Wisconsin law to Mortgages II and III; it granted summary judgment for appellees on Count I (Mortgage I) and for UCB on Counts II and III.
The district court held Illinois’s “single refiling” rule barred UCB from enforcing the promissory note underlying Mortgage I, and Illinois precedent prevents foreclosure when the underlying note is barred.
UCB’s motion for reconsideration argued Wisconsin law governed Mortgage I (relying on the original mortgage’s choice-of-law clause); the court denied reconsideration as UCB waived the choice-of-law argument by not raising it earlier.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the district court abused its discretion by denying UCB’s motion for reconsideration of choice-of-law for Mortgage I	UCB: Mortgage I is governed by Wisconsin law because the original mortgage contains a Wisconsin choice-of-law clause (the court should apply that clause rather than a later amendment selecting Illinois)	Appellees: UCB failed to raise choice-of-law before summary judgment; it acquiesced to application of Illinois law	Denied: no abuse of discretion — UCB waived the choice-of-law challenge by not presenting it during summary judgment proceedings
Whether Illinois’s single-refiling rule bars UCB from foreclosing Mortgage I	UCB: Even if the single-refiling rule bars actions on the note, a foreclosure is a distinct cause of action and thus should not be barred	Appellees: Illinois law treats the mortgage as incident to the debt; if action on the note is barred, foreclosure is barred too	Affirmed: Illinois single-refiling rule bars enforcement of the note; Illinois precedent forbids foreclosure when the underlying debt action is barred, so summary judgment for appellees on Count I is proper

Caisse Nationale de Credit Agricole v. CBI Indus., Inc., 90 F.3d 1264 (7th Cir.) (standard of review for motions for reconsideration)
Cincinnati Life Ins. Co. v. Beyrer, 722 F.3d 939 (7th Cir.) (deferential standard for review of discretionary rulings)
Bloch v. Frischholz, 587 F.3d 771 (7th Cir.) (argument first raised in motion to reconsider is waived)
Brooks v. City of Chicago, 564 F.3d 830 (7th Cir.) (arguments raised first in reconsideration are waived)
Lott v. Levitt, 556 F.3d 564 (7th Cir.) (litigant cannot wait to see adverse law application then seek a different jurisdictional rule)
Carr v. Tillery, 591 F.3d 909 (7th Cir.) (interpretation of Illinois single-refiling rule)
Timberlake v. Illini Hosp., 676 N.E.2d 636 (Ill.) (Illinois precedent that a mortgage is incident to the debt and is barred when the underlying debt is barred)
Hibernian Banking Ass’n v. Commercial Nat. Bank, 41 N.E. 919 (Ill.) (longstanding Illinois rule treating mortgage as incident to the debt)