1020-00005 · Greenfield Agricultural Partners · Discovery

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PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT

CALDERWOOD & HARKNESS LLP INTEROFFICE MEMORANDUM

TO: Francesca Morano, Partner

FROM: Hannah Brinkley, Associate

DATE: September 20, 2022

RE: discovery Strategy — Greenfield Agricultural Partners LLC v. Prairie Basin Grain Co. et al., Circuit Court of Cook County, Illinois, Case No. 2022-L-004831

MATTER NO.: C&H Matter No. 1020-00005

PRIVILEGE DESIGNATION: This memorandum is protected by the attorney-client privilege and the work product doctrine. It is prepared in anticipation of litigation and for the purpose of providing legal advice to our client, Greenfield Agricultural Partners LLC. This memorandum contains mental impressions, conclusions, opinions, and legal theories of counsel. Do not distribute outside of the Calderwood & Harkness LLP engagement team without prior authorization from Francesca Morano.

I. Purpose and Summary

The purpose of this memorandum is to set forth a comprehensive discovery plan for the above-referenced litigation following two significant procedural developments: (1) the August 22, 2022 ruling by the Honorable Patricia Delacroix granting Greenfield Agricultural Partners LLC's ("GAP") Motion to Strike the force majeure and commercial impracticability affirmative defenses asserted by Prairie Basin Grain Co. ("PBGC"); and (2) the September 12, 2022 Case Management Conference at which Judge Delacroix established the discovery schedule and related case management deadlines. Together, these developments substantially narrow the contested issues and create a clear pathway toward resolution of this matter, provided that our discovery efforts are targeted and efficient.

The discovery plan outlined herein is designed to serve three primary objectives:

First, establishing the full amount owed under the Master Grain Purchase and Off-Take Agreement dated March 15, 2019 (the "Off-Take Agreement") and defeating PBGC's sole surviving affirmative defense — failure to mitigate damages. With the force majeure and commercial impracticability defenses eliminated by the court's August 22 ruling, the failure-to-mitigate defense is the only remaining obstacle to establishing PBGC's liability on all claims. Our discovery must foreclose this defense both factually and legally.

Second, developing a thorough understanding of PBGC's financial condition and asset base, as well as the personal financial condition of co-defendant Darren K. Musgrave, for purposes of judgment enforcement. Given the significant sums at issue — $4,870,050.00 in unpaid principal, plus contractual interest accruing at 1.5% per month — and the indications that PBGC is under severe financial distress, early assessment of enforcement prospects is essential to advising our client on whether to pursue an aggressive litigation timeline, consider settlement, or both.

Third, building the evidentiary foundation necessary to support a motion for summary judgment on all counts. The nature of GAP's claims — breach of a written contract for the price of goods delivered and accepted, breach of a written personal guaranty, and account stated — is well-suited to summary disposition if the factual record is properly developed through admissions, authenticated documents, and uncontested evidence.

As noted below, written discovery was served on September 30, 2022 (Plaintiff's First Set of Interrogatories to PBGC and Plaintiff's First Request for Production of Documents to PBGC), and Plaintiff's Requests for Admission to PBGC were served on October 14, 2022. This memorandum outlines the strategic framework behind those discovery vehicles, identifies anticipated additional discovery directed at Musgrave individually and at relevant third parties, and sets forth the recommended timeline for depositions, summary judgment preparation, and related next steps.

II. Current Procedural Posture

A. Pleadings Status

GAP filed its Verified Complaint on May 9, 2022, asserting four counts arising from PBGC's failure to pay for grain delivered under the Off-Take Agreement:

Count I — Breach of Contract (Off-Take Agreement) against PBGC. GAP alleges that PBGC breached Sections 4.1 and 7.1 of the Off-Take Agreement by failing to pay for grain duly delivered and accepted at PBGC's elevator facilities. The principal amount owed is $4,870,050.00, representing five unpaid invoices issued between September 28, 2021 and January 19, 2022. GAP further seeks contractual interest at the rate of 1.5% per month (18% per annum) on all overdue amounts pursuant to Section 7.3 of the Off-Take Agreement, which provides that "[a]ll amounts not paid when due shall bear interest at the rate of one and one-half percent (1.5%) per month from the date due until the date paid in full."

Count II — Breach of Personal Guaranty against Darren K. Musgrave. As an inducement to GAP's entry into the Off-Take Agreement, Musgrave executed a Personal Guaranty of Payment (attached to the Off-Take Agreement as Exhibit D) guaranteeing PBGC's payment obligations up to an aggregate cap of $2,000,000. GAP alleges that Musgrave's obligations under the Guaranty have been triggered by PBGC's failure to pay amounts due under the Off-Take Agreement, and that Musgrave has failed to honor his guaranty obligations despite demand.

Count III — Account Stated against PBGC. GAP alleges that PBGC received and retained the five invoices without objection, and that Musgrave's February 3, 2022 email acknowledging the debt and requesting forbearance constitutes an acknowledgment of the account stated. The amounts due on the account stated are identical to the amounts claimed under Count I.

Count IV — Unjust Enrichment (Alternative) against PBGC. Pleaded in the alternative, GAP alleges that PBGC received the benefit of the grain delivered by GAP and has been unjustly enriched by its failure to pay.

Service of process was completed on May 24, 2022. PBGC was served through its registered agent, Ridgeline Corporate Services LLC, in accordance with 735 ILCS 5/2-204. Musgrave was personally served at his residence at 1188 Windermere Lane, Champaign, Illinois 61822, by a Cook County process server.

Defendants, through their counsel Bartlett, Reyes Linley CPAs LLP & Harkin LLP (Douglas M. Harkin, lead partner; Nadia C. Petrov, associate), filed their Answer and Affirmative Defenses on June 27, 2022. The Answer largely denied the material allegations of the Complaint, though notably it did not deny the existence or authenticity of the Off-Take Agreement itself. Defendants asserted three affirmative defenses:

First Affirmative Defense — Force Majeure. PBGC alleged that the October 17, 2021 fire at its Macon County grain elevator facility constituted a force majeure event under Section 9.1 of the Off-Take Agreement, excusing PBGC's performance obligations.

Second Affirmative Defense — Commercial Impracticability. PBGC alleged that the combined effect of the Macon County fire, disruptions in the grain market, and the resulting financial strain rendered its performance commercially impracticable within the meaning of Section 2-615 of the Uniform Commercial Code as adopted in Illinois.

Third Affirmative Defense — Failure to Mitigate. PBGC alleged that GAP failed to take reasonable steps to mitigate its damages, including by failing to resell undelivered grain at market prices and by failing to accept partial payment in lieu of the full amounts due.

B. Motion to Strike Ruling — August 22, 2022

On July 15, 2022, GAP moved to strike all three affirmative defenses pursuant to 735 ILCS 5/2-615, arguing that none stated a legally sufficient defense. Following full briefing and oral argument on August 18, 2022, Judge Delacroix issued her ruling on August 22, 2022, granting GAP's motion in part and denying it in part.

The court struck the force majeure defense on two independent grounds. First, the court held that the force majeure clause in Section 9.1 of the Off-Take Agreement, by its plain terms, excuses only delays or failures in the physical delivery or receipt of grain — not payment obligations. The court cited the limiting language in Section 9.1 that references "performance of delivery or receipt obligations" and noted the absence of any language extending force majeure relief to payment obligations. Second, the court found that even if the clause could be read to apply to payment obligations, PBGC failed to allege facts showing that the Macon County fire rendered payment impossible or impracticable, given that the fire affected only one of PBGC's six grain elevator facilities and that PBGC continued to operate its remaining five facilities during the relevant period.

The court struck the commercial impracticability defense on the ground that financial difficulty, standing alone, does not constitute commercial impracticability under Illinois law. The court cited Kel Kim Corp. v. Central Markets, Inc., 70 N.Y.2d 900 (1987), and the Restatement (Second) of Contracts § 261, cmt. d, both of which have been adopted by Illinois courts, for the proposition that mere increases in cost or financial hardship do not excuse contractual obligations absent supervening impossibility of performance. The court noted that PBGC's allegations amounted to financial difficulty caused by a combination of factors — the elevator fire, hedging losses, and market conditions — none of which rendered payment impossible as opposed to merely burdensome.

The court denied GAP's motion as to the failure-to-mitigate defense, finding that PBGC had adequately pleaded facts suggesting that GAP may have had opportunities to reduce its damages by reselling undelivered grain or taking other steps to minimize losses. While the court did not express any view on the merits of this defense, it held that the defense was not facially insufficient at the pleading stage and could be tested through discovery and, if appropriate, summary judgment.

This ruling is of critical importance. The elimination of the force majeure and commercial impracticability defenses means that PBGC has no viable defense to liability for its failure to pay for grain that was delivered and accepted. The sole remaining issue is whether GAP failed to mitigate its damages, and as discussed in Section III.B below, this defense is factually weak and may be legally inapplicable given the nature of GAP's claims.

C. Case Management Conference — September 12, 2022

At the September 12, 2022 Case Management Conference, Judge Delacroix established the following discovery schedule by written order:

The schedule provides approximately six months for fact discovery and an additional three months for expert discovery. For the reasons set forth herein, we believe that the nature of this case — a straightforward claim for the contract price of goods delivered, supported by written agreements and invoices — may allow us to complete discovery well in advance of these deadlines and move for summary judgment on or before the July 28, 2023 dispositive motions deadline. An accelerated timeline is particularly desirable given the concerns regarding PBGC's financial condition and the risk of asset dissipation.

III. Discovery Objectives

A. Objective 1: Establish the Debt and Eliminate Remaining Defenses

The first and most fundamental objective of our discovery plan is to confirm, through binding admissions and documentary evidence, the core elements of GAP's breach of contract claim: the existence of the Off-Take Agreement, GAP's performance (delivery and acceptance of grain), PBGC's breach (non-payment), and the amount of damages.

Authentication of the Off-Take Agreement and Related Documents. Our Requests for Admission seek to confirm the authenticity and due execution of the Master Grain Purchase and Off-Take Agreement dated March 15, 2019, including all exhibits thereto. The most critical exhibits for our purposes are Exhibit B (the quarterly basis differential schedule, which governs pricing), and Exhibit D (the Musgrave Personal Guaranty of Payment, which is the foundation of Count II). While Defendants' Answer did not deny the existence of the Off-Take Agreement, they did not affirmatively admit its authenticity, and we need binding admissions or other authenticated copies to support summary judgment.

Confirmation of Delivery and Acceptance. Our discovery seeks to confirm through admissions, documents, and testimony that PBGC received and accepted all grain shipments underlying the five unpaid invoices. The invoices, amounts, and key details are as follows:

Each of these invoices was issued in accordance with Section 7.1 of the Off-Take Agreement, which provides for payment within thirty (30) days of the invoice date. GAP's records reflect that each delivery was made to the specified PBGC elevator facility and that PBGC issued weight tickets or receiving receipts acknowledging receipt and quality grade. Our document requests seek production of PBGC's own receiving records, scale tickets, and any internal communications confirming receipt and acceptance.

Confirmation of Non-Payment and Interest. Our Requests for Admission directly ask PBGC to admit that no payment has been made on any of the five invoices. Our interrogatories ask PBGC to identify any payments made and the dates thereof. The contractual interest rate of 1.5% per month (18% per annum) under Section 7.3 is a significant component of the total recovery. Patrick Gallagher and Diane K. Velasquez have prepared an interest calculation spreadsheet showing accrued interest from each invoice's due date through the anticipated date of judgment. As of October 1, 2022, the accrued interest exceeds $600,000 and continues to grow at approximately $73,000 per month.

Attorneys' Fees Provision. Section 12.4 of the Off-Take Agreement provides that "[i]n any action or proceeding arising out of or relating to this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees, costs, and expenses." This provision will be significant at the judgment stage. Our Requests for Admission seek confirmation of the existence and terms of this provision. Our discovery into PBGC's financial condition is also relevant to assessing whether an award of attorneys' fees will be collectible.

B. Objective 2: Defeat the Failure-to-Mitigate Defense

The failure-to-mitigate defense is PBGC's sole remaining affirmative defense, and it is, in our assessment, both legally questionable and factually unsupported. Nevertheless, it must be addressed comprehensively through discovery to foreclose any argument at the summary judgment stage.

Identifying PBGC's Theory. As a threshold matter, our interrogatories require PBGC to state with specificity the factual basis for its failure-to-mitigate defense, including: (a) what actions PBGC contends GAP should have taken to mitigate; (b) when GAP should have taken those actions; (c) what damages would have been avoided had GAP acted as PBGC contends it should have; and (d) the identity of all persons with knowledge of facts supporting this defense. PBGC's Answer offered only conclusory allegations, and we need to force PBGC to commit to a specific theory that can be tested and refuted.

Establishing GAP's Reasonable Mitigation Efforts. The documentary record already in GAP's possession demonstrates that GAP acted promptly and reasonably in response to PBGC's non-payment. The timeline of relevant events is as follows:

January 25, 2022: Caleb Jennings, GAP's Director of Grain Operations, sent a formal written demand to PBGC for payment of the first three invoices (GAP-2021-3187, GAP-2021-3244, and GAP-2021-3301), totaling $3,053,250.00. The demand letter was sent by certified mail and email to Darren K. Musgrave at PBGC's principal office in Champaign, Illinois.

February 3, 2022: Musgrave responded to Jennings by email, acknowledging the debt and the amounts owed. Musgrave stated that PBGC was "experiencing temporary cash flow difficulties" and requested a 90-day forbearance, explaining that PBGC was "in active negotiations with Heartland Prairie Bank for additional financing that [would] allow [PBGC] to bring all accounts current." This email is highly significant for multiple purposes: it constitutes an admission of the debt (supporting Count III, Account Stated), it negates any claim that GAP failed to communicate or cooperate with PBGC, and it provides context for GAP's decision to extend limited forbearance.

February 14, 2022: GAP, through Caleb Jennings, agreed to a 60-day forbearance (not the 90 days Musgrave requested) conditioned on PBGC making a partial payment of Invoice GAP-2021-3187 ($892,500.00) by March 1, 2022. This conditional forbearance was confirmed in writing and demonstrates GAP's willingness to work with PBGC to resolve the situation — the opposite of a party failing to mitigate.

March 1, 2022: PBGC failed to make the required partial payment. No payment was received on March 1, 2022 or at any time thereafter.

March 8, 2022: Less than one week after PBGC's failure to make the required partial payment, GAP suspended further deliveries under Section 8.2 of the Off-Take Agreement (Adequate Assurance of Performance). Section 8.2 provides that "[i]f reasonable grounds for insecurity arise with respect to the performance of either party, the other party may in writing demand adequate assurance of due performance and may, if commercially reasonable, suspend any performance for which it has not already received the agreed return until such assurance is received." GAP's suspension of deliveries on March 8 demonstrates that GAP acted promptly to cut its losses and prevent further unpaid deliveries — which is the very essence of mitigation.

April 11, 2022: Francesca Morano sent a formal demand letter on behalf of GAP to PBGC and Musgrave, demanding payment of all five unpaid invoices totaling $4,870,050.00 plus accrued interest, and notifying Musgrave of GAP's intent to enforce the Personal Guaranty.

May 9, 2022: GAP filed the present action.

discovery Directed at the Mitigation Defense. In addition to the interrogatories requiring PBGC to specify its theory, our document requests seek production of any communications between PBGC and third parties regarding alternative grain sourcing, or any evidence that GAP could have resold undelivered grain at comparable or near-comparable market prices to reduce its damages. We also seek production of any market data or analysis PBGC may have relied upon in formulating its mitigation defense. If PBGC cannot produce any such evidence — and we believe it is unlikely that such evidence exists — the defense will be unsupported and subject to disposition on summary judgment.

Strategic Assessment. The failure-to-mitigate defense is weak for several reasons. Most fundamentally, GAP's claim is for the contract price of goods already delivered and accepted — not for lost profits on prospective future deliveries. Under Illinois law, the duty to mitigate generally requires a plaintiff to take reasonable steps to minimize losses from a breach, but that duty does not require a seller to seek out alternative buyers for goods that have already been delivered to and accepted by the breaching party. See Midland Hotel Corp. v. Reuben H. Donnelley Corp., 118 Ill.2d 306, 317 (1987). The five invoices at issue all represent grain that was physically delivered to PBGC's elevator facilities, weighed, inspected, accepted, and placed into PBGC's storage or processing operations. There is simply nothing for GAP to "mitigate" with respect to those completed transactions.

Even if the duty to mitigate is somehow found to apply, GAP's conduct was objectively reasonable. GAP demanded payment, agreed to limited forbearance conditioned on a partial payment, and when PBGC failed to make even that partial payment, GAP suspended further deliveries within one week. GAP then made a formal demand through counsel and filed suit within approximately two months. No reasonable argument can be made that GAP was dilatory or failed to act to protect its interests.

Finally, the burden of proving failure to mitigate rests on PBGC as the party asserting the defense. See Siegel v. Levy Organization Development Co., 153 Ill.2d 534, 543 (1992). If PBGC cannot identify, through discovery, any specific action GAP should have taken or any specific amount of damages that would have been avoided, the defense fails as a matter of law.

C. Objective 3: Assess PBGC's Financial Condition and Asset Base (Enforcement)

Even before obtaining judgment, discovery into PBGC's financial condition and asset base is critical for multiple reasons. First, it allows us to assess the realistic prospects for collecting on a judgment against PBGC and to determine whether the Musgrave Guaranty represents a more viable path to recovery. Second, it informs our advice to the client regarding settlement — if PBGC is effectively judgment-proof due to Heartland Prairie Bank's senior secured position, a negotiated resolution that captures available value may be preferable to incurring the costs of trial. Third, it allows us to identify any potential fraudulent transfer or asset dissipation issues that might warrant additional claims or emergency relief.

Interrogatories Regarding Financial Condition. Our interrogatories directed at PBGC seek the following categories of financial information:

(a) Identification of all bank accounts held by PBGC at any financial institution, including the name and address of each institution, account numbers, and current balances as of the most recent statement date.

(b) Identification of all real property owned or leased by PBGC, including the six grain elevator facilities located in Champaign, Macon, and Piatt Counties. For each property, we seek the legal description, current fair market value, any mortgages or liens encumbering the property, and the identity of any tenants or sublessees.

(c) All outstanding secured and unsecured indebtedness, with particular emphasis on the Heartland Prairie Bank Revolving Credit and Term Loan Agreement dated June 1, 2018. Based on information available from public filings and our client's knowledge, the HPB facility has an aggregate commitment of approximately $45 million, and the outstanding balance as of April 2022 (when HPB reportedly declared a default) was approximately $31.4 million. The terms, collateral, and current status of this facility are critical to assessing whether any unencumbered assets exist against which a GAP judgment could be enforced.

(d) A list of all pending litigation and claims against PBGC, including any actions by Heartland Prairie Bank to enforce its security interest, any actions by other creditors, and any regulatory proceedings.

(e) The status of PBGC's insurance claim with Triton Mutual Insurance Co. arising from the October 17, 2021 fire at the Macon County grain elevator facility. The estimated loss from the fire is approximately $3.2 million. Our understanding is that coverage under the property insurance policy may be disputed due to an alleged lapse in premium payments — a fact that, if true, would further confirm PBGC's severe financial distress. Any insurance proceeds recovered by PBGC would potentially be available to satisfy creditor claims, although the priority of such proceeds relative to Heartland Prairie Bank's security interest must be analyzed.

(f) Details regarding PBGC's Q4 2021 hedging losses. Based on information provided by our client and from industry sources, PBGC sustained estimated losses of approximately $6.8 million in mark-to-market losses on short corn futures positions during the fourth quarter of 2021, when corn prices spiked due to supply chain disruptions and strong export demand. These hedging losses appear to be the primary cause of PBGC's liquidity crisis and its inability to pay GAP and other creditors.

Document Requests Regarding Financial Condition. Our document requests seek:

(a) PBGC's audited financial statements for fiscal years 2020 and 2021. These statements were prepared by Mercer Tidwell & Associates PC (engagement partner Joan F. Tidwell), a Champaign-based accounting firm. If PBGC fails to produce these statements, we will subpoena them directly from Mercer Tidwell.

(b) Monthly or quarterly internally prepared financial statements for 2022, including balance sheets, income statements, and cash flow statements.

(c) All loan agreements, security agreements, promissory notes, and related documents evidencing the Heartland Prairie Bank credit facility, including any amendments, modifications, or forbearance agreements. We also seek all UCC financing statements filed by Heartland Prairie Bank with the Illinois Secretary of State.

(d) All communications between PBGC (including Musgrave, Lydia R. Musgrave, and Victor P. Novotny) and any representative of Heartland Prairie Bank, including Kenneth W. Aldrich (SVP, Agribusiness Lending), regarding PBGC's default under the credit facility, any workout discussions, and any enforcement actions taken or threatened.

(e) All insurance policies issued by Triton Mutual Insurance Co. to PBGC, and all correspondence, claim submissions, adjusters' reports, coverage determinations, and related documents regarding the Macon County elevator fire.

(f) All hedging account statements, brokerage agreements, margin call notices, and related records for PBGC's commodity hedging accounts for Q3 and Q4 2021.

Assessment of Enforcement Prospects. The purpose of this financial discovery is to enable us to provide GAP with a realistic assessment of its recovery prospects. The preliminary picture is concerning. If Heartland Prairie Bank holds a prior perfected security interest under UCC Article 9 that effectively blankets all of PBGC's assets — including accounts receivable, inventory, equipment, and general intangibles — then GAP may find that even after obtaining a judgment, there are insufficient unencumbered assets to satisfy it. The outstanding balance on the HPB facility ($31.4 million) against aggregate assets that we estimate at approximately $35–40 million suggests that the equity cushion may be thin or nonexistent, particularly after accounting for the Macon County fire losses, hedging losses, and other creditor claims.

The Musgrave Guaranty as an Alternative Recovery Path. If PBGC is effectively judgment-proof due to Heartland Prairie Bank's senior secured position, recovery under the Musgrave Personal Guaranty — capped at $2,000,000 — may represent the most viable path to meaningful recovery for GAP. Discovery into Musgrave's personal financial condition will be necessary to assess this avenue. His residence at 1188 Windermere Lane, Champaign, Illinois 61822 may have significant equity, and he may have other personal assets (investment accounts, other real property, interests in other entities) that could be reached to satisfy a guaranty judgment. Separate discovery directed to Musgrave individually, as discussed in Section IV.B.1 below, will be essential.

D. Objective 4: Foundation for Summary Judgment

The discovery plan is specifically designed to build the evidentiary record necessary to support a motion for summary judgment on all four counts. Given the straightforward nature of the breach of contract and account stated claims, and the weakness of the sole remaining affirmative defense, this case is well-suited for summary disposition.

Requests for Admission as the Cornerstone. The Requests for Admission served on October 14, 2022 are the most critical component of our summary judgment strategy. They are carefully drafted to establish, if admitted or deemed admitted, each element of the breach of contract, breach of guaranty, and account stated claims:

(a) The Off-Take Agreement is a genuine and authentic document executed by Darren K. Musgrave on behalf of PBGC and by Caleb Jennings on behalf of GAP.

(b) Exhibit D to the Off-Take Agreement — the Musgrave Personal Guaranty of Payment — is a genuine and authentic document executed by Darren K. Musgrave in his individual capacity.

(c) Each of the five invoices identified in the Complaint (GAP-2021-3187, GAP-2021-3244, GAP-2021-3301, GAP-2021-3358, and GAP-2022-0042) was issued by GAP to PBGC and received by PBGC.

(d) The grain described in each of the five invoices was delivered by GAP to PBGC's designated elevator facility and accepted by PBGC.

(e) The amounts stated on each invoice are accurate and reflect the contract price for the grain delivered.

(f) No payment has been made by PBGC or Musgrave on any of the five invoices.

(g) Section 7.3 of the Off-Take Agreement provides for interest on overdue amounts at the rate of 1.5% per month.

(h) Section 12.4 of the Off-Take Agreement provides for recovery of attorneys' fees by the prevailing party.

Deemed Admissions Under Illinois Supreme Court Rule 216. Under Illinois Supreme Court Rule 216(a), a party served with Requests for Admission must respond within 28 days. If PBGC fails to respond by the November 11, 2022 deadline, all requests are deemed admitted. Deemed admissions under Rule 216 are conclusive and cannot be withdrawn except by leave of court upon a showing of good cause. Given PBGC's apparent financial distress — and the possibility that its counsel may be experiencing difficulty securing payment for legal fees — there is a meaningful possibility that PBGC will fail to respond timely or at all.

Combined Effect with the August 22 Ruling. If the Requests for Admission are admitted or deemed admitted, and combined with the court's August 22, 2022 ruling striking the force majeure and commercial impracticability defenses, all elements of Counts I (breach of contract), Count II (breach of guaranty), and Count III (account stated) will be established by undisputed evidence. The only remaining issue for summary judgment briefing would be the failure-to-mitigate defense, which, as discussed in Section III.B, is both legally and factually deficient.

Supporting Documentary Evidence. Even apart from the Requests for Admission, GAP's own records provide robust documentary support for summary judgment:

• The executed Off-Take Agreement and all exhibits, including the Musgrave Guaranty.

• Copies of all five invoices with delivery tickets and PBGC receiving receipts.

• The January 25, 2022 demand letter from Caleb Jennings.

• The February 3, 2022 email from Darren Musgrave acknowledging the debt.

• The February 14, 2022 conditional forbearance agreement.

• The March 8, 2022 suspension notice under Section 8.2.

• The April 11, 2022 demand letter from Francesca Morano.

Caleb Jennings, GAP's Director of Grain Operations, can provide an affidavit authenticating all of GAP's business records under the Illinois business records exception to the hearsay rule (735 ILCS 5/8-401) and attesting to the facts of performance, delivery, invoicing, demand, forbearance, and suspension. Patrick Gallagher and Diane K. Velasquez have prepared an interest calculation spreadsheet that can be incorporated into Jennings' affidavit or submitted as an exhibit with a separate supporting declaration.

IV. Discovery Plan — Specific Vehicles

A. Written discovery Already Served

1. Plaintiff's First Set of Interrogatories to PBGC (served September 30, 2022). The First Set of Interrogatories contains twenty-five interrogatories (the maximum permitted under Cook County Local Rule 206(a) without leave of court) directed at PBGC. The key interrogatories are organized around the following subject areas:

Financial Condition and Assets (Interrogatories 1–8): These interrogatories require PBGC to identify all bank accounts and financial institutions, all real property owned or leased (including the six grain elevator facilities in Champaign, Macon, and Piatt Counties), all outstanding secured and unsecured indebtedness, all pending litigation and claims, and all material changes in financial condition since December 31, 2021. Interrogatory No. 5 specifically addresses the Heartland Prairie Bank Revolving Credit and Term Loan Agreement, including the original terms, outstanding balance, default status, and any workout or forbearance arrangements. Interrogatory No. 6 addresses the Triton Mutual Insurance Co. claim for the Macon County elevator fire, including the date of the claim submission, the current status, any coverage disputes, and the amount of any proceeds received or expected. Interrogatory No. 7 addresses PBGC's hedging activities in Q3 and Q4 2021, including the nature and size of positions, the identity of the brokerage firm, the amount of realized and unrealized losses, and any margin calls.

Off-Take Agreement and Performance (Interrogatories 9–14): These interrogatories require PBGC to identify all persons involved in the negotiation and execution of the Off-Take Agreement, all persons with knowledge of PBGC's performance or non-performance thereunder, all communications between PBGC and GAP regarding the Off-Take Agreement, all payments made by PBGC on any invoices issued by GAP, and the reasons for PBGC's failure to pay the five invoices at issue.

Failure-to-Mitigate Defense (Interrogatories 15–19): These interrogatories are specifically designed to require PBGC to articulate its failure-to-mitigate theory with precision. Interrogatory No. 15 asks PBGC to identify with specificity each action that GAP allegedly should have taken to mitigate its damages. Interrogatory No. 16 asks PBGC to state when each such action should have been taken. Interrogatory No. 17 asks PBGC to state the amount of damages that would have been avoided had GAP taken each identified action. Interrogatory No. 18 asks PBGC to identify all evidence — documentary or testimonial — that supports the failure-to-mitigate defense. Interrogatory No. 19 asks PBGC to identify any communications between PBGC and third parties regarding alternative grain sourcing that would suggest GAP had available opportunities to resell undelivered grain.

Witnesses and Experts (Interrogatories 20–25): These interrogatories require PBGC to identify all fact witnesses with knowledge of the matters alleged in the Complaint and Answer, all persons who participated in communications with GAP or Heartland Prairie Bank regarding PBGC's financial condition, and any experts PBGC intends to retain.

PBGC's responses are due 28 days from service — i.e., on or about October 28, 2022.

2. Plaintiff's First Request for Production of Documents to PBGC (served September 30, 2022). The First Request for Production contains thirty-two document requests organized into the following categories:

Category A — Contract Documents (Requests 1–5): The Off-Take Agreement and all exhibits, schedules, amendments, and modifications; all correspondence and communications between GAP and PBGC relating to the Off-Take Agreement; all purchase orders, confirmations, and related transactional documents; all invoices issued by GAP and received by PBGC; and all delivery tickets, scale tickets, receiving receipts, and quality inspection records.

Category B — Payment Records (Requests 6–9): All records of payments made by PBGC to GAP, including cancelled checks, wire transfer confirmations, and ledger entries; all internal communications regarding PBGC's decision to withhold payment on the five invoices; all communications with GAP regarding payment, forbearance, or settlement; and all accounts payable records reflecting amounts owed to GAP.

Category C — Financial Statements and Records (Requests 10–16): PBGC's audited financial statements for FY 2020 and FY 2021 as prepared by Mercer Tidwell & Associates PC; monthly or quarterly internally prepared financial statements for January through September 2022; tax returns for FY 2020 and FY 2021; general ledger and chart of accounts; accounts receivable aging reports; and any budgets, forecasts, or financial projections prepared in 2021 or 2022.

Category D — Heartland Prairie Bank (Requests 17–21): All loan agreements, promissory notes, security agreements, and related documents evidencing the revolving credit and term loan facility; all UCC financing statements filed by Heartland Prairie Bank; all correspondence with Kenneth W. Aldrich or any other HPB representative regarding PBGC's financial condition, default, or workout; any forbearance or standstill agreements; and any appraisals of PBGC's assets prepared for or at the request of Heartland Prairie Bank.

Category E — Triton Mutual Insurance Co. (Requests 22–25): All property insurance policies issued by Triton Mutual to PBGC; all claim submissions and supporting documentation relating to the October 17, 2021 Macon County elevator fire; all coverage determination letters, adjuster reports, and related correspondence; and all premium payment records for the two-year period preceding the fire.

Category F — Hedging and Brokerage Records (Requests 26–28): All brokerage account agreements and statements for PBGC's commodity hedging accounts for Q3 and Q4 2021; all margin call notices and related correspondence; and all internal communications regarding PBGC's hedging strategy and losses.

Category G — Mitigation and Miscellaneous (Requests 29–32): All documents relating to or supporting PBGC's failure-to-mitigate defense; all communications between PBGC and any third party regarding alternative grain sourcing or the availability of grain from sources other than GAP; all organizational documents for PBGC (articles of organization, operating agreement, amendments); and all documents relating to any distributions, dividends, or transfers of assets from PBGC to any member, officer, or affiliate since January 1, 2021.

PBGC's responses are due 28 days from service — i.e., on or about October 28, 2022.

3. Plaintiff's Requests for Admission to PBGC (served October 14, 2022). As discussed in Section III.D above, the Requests for Admission contain twenty-two individually numbered requests targeting the core elements of each claim. The key admissions sought are:

(a) Authenticity and due execution of the Off-Take Agreement by Darren K. Musgrave on behalf of PBGC (Requests Nos. 1–3).

(b) Authenticity and due execution of the Musgrave Personal Guaranty of Payment (Exhibit D) by Darren K. Musgrave individually (Requests Nos. 4–5).

(d) Delivery of the grain described in each invoice to PBGC's designated elevator facility (Requests Nos. 11–15).

(e) Acceptance of the grain by PBGC and the accuracy of the amounts stated on each invoice (Requests Nos. 16–17).

(f) Non-payment — admission that no payment has been made by PBGC or Musgrave on any of the five invoices (Request No. 18).

(g) That Section 7.3 of the Off-Take Agreement provides for interest at 1.5% per month on overdue amounts (Request No. 19).

(h) That Section 12.4 of the Off-Take Agreement provides for the prevailing party to recover reasonable attorneys' fees (Request No. 20).

(i) That Musgrave received the April 11, 2022 demand letter from Francesca Morano (Request No. 21).

(j) That the Musgrave Guaranty guarantees payment of PBGC's obligations under the Off-Take Agreement up to $2,000,000 (Request No. 22).

The deadline for PBGC's responses is November 11, 2022. As noted, failure to respond within 28 days results in deemed admissions under Illinois Supreme Court Rule 216(a).

B. Anticipated Additional discovery

1. Interrogatories and Document Requests Directed to Darren K. Musgrave Individually. We recommend serving a separate set of interrogatories and document requests on Musgrave in his individual capacity as a co-defendant and the obligor under the Personal Guaranty. This discovery should focus on the following areas:

Personal Financial Condition and Assets: Musgrave should be required to identify all personal bank and brokerage accounts, all real property owned individually or jointly with his spouse (including the residence at 1188 Windermere Lane, Champaign, IL 61822, and any other properties), all retirement accounts and investments, all sources of personal income (including salary and distributions from PBGC), all personal indebtedness and obligations, and any transfers of personal assets exceeding $10,000 made since January 1, 2021.

Enforceability of the Guaranty: While we do not anticipate a serious challenge to the enforceability of the Guaranty, we should request documents confirming that the Guaranty was executed voluntarily and with full understanding of its terms. We should also seek production of any communications in which Musgrave acknowledged or discussed his obligations under the Guaranty.

This discovery should be prepared and served promptly. I recommend a target service date of no later than October 31, 2022, to allow sufficient time for responses within the fact discovery period.

2. Subpoenas to Third Parties. We recommend issuing subpoenas duces tecum to three third parties whose records are critical to assessing PBGC's financial condition and enforcement prospects:

Heartland Prairie Bank, N.A. (300 East Main Street, Decatur, IL 62521). We should subpoena the following from HPB: all loan agreements, promissory notes, security agreements, guarantees, and related documents evidencing the PBGC credit facility; all UCC financing statements and continuation statements filed with the Illinois Secretary of State; all correspondence regarding PBGC's default, including any default notices, demand letters, and forbearance agreements; all appraisals or valuations of PBGC's assets prepared for or at the request of HPB; and all communications between HPB (including Kenneth W. Aldrich) and PBGC regarding PBGC's financial condition and workout discussions. These records are directly relevant to assessing the extent of HPB's security interest, the value of its collateral, and whether any equity exists above HPB's secured claim that would be available to satisfy a GAP judgment.

Triton Mutual Insurance Co. (820 South Neil Street, Champaign, IL 61820). We should subpoena the following from Triton Mutual: the complete claim file for the Macon County elevator fire (claim date: October 17, 2021), including all claim submissions, adjusters' reports, damage assessments, and coverage analyses; the property insurance policy under which the claim was submitted; all correspondence between Triton Mutual and PBGC regarding the claim, including any coverage denial or reservation of rights letters; and all premium payment records for the 24 months preceding the fire. The key issue is whether Triton Mutual has denied coverage based on an alleged premium lapse. If coverage was denied, the fire loss reduces PBGC's asset base by approximately $3.2 million. If coverage is upheld and proceeds are paid, those proceeds may be subject to Heartland Prairie Bank's security interest (which typically covers insurance proceeds as part of the collateral package).

Mercer Tidwell & Associates PC (112 West Church Street, Champaign, IL 61820). We should subpoena PBGC's audited financial statements for FY 2020 and FY 2021, together with any management letters issued by the auditors. This subpoena serves as a backstop in the event PBGC fails to produce its audited financial statements in response to our direct document requests. Management letters may contain observations or warnings about PBGC's financial condition, internal controls, or going-concern issues that would be relevant to our enforcement analysis.

All three subpoenas should be issued pursuant to Illinois Supreme Court Rule 204 and served promptly. We will need to provide the required notice to PBGC and Musgrave's counsel under Rule 204(c) prior to service.

3. Depositions. We anticipate taking the following depositions during the fact discovery period:

Darren K. Musgrave — President, sole director, and 72% shareholder of PBGC, and the individual guarantor under the Musgrave Guaranty. Musgrave is the single most important witness in this litigation and his deposition should be comprehensive. Key topics include: his role in negotiating and executing the Off-Take Agreement; PBGC's decision to cease paying GAP; PBGC's financial condition, including the Heartland Prairie Bank default, the Macon County fire, and the hedging losses; the February 3, 2022 email acknowledging the debt and requesting forbearance; his understanding of and intent regarding the Personal Guaranty; any communications with Heartland Prairie Bank regarding the HPB default; the status of the Triton Mutual insurance claim; any transfers of PBGC assets or personal assets since January 1, 2021; and any alleged failure by GAP to mitigate its damages. This deposition will likely require a full day.

Lydia R. Musgrave — Secretary, Treasurer, and 18% shareholder of PBGC. Lydia Musgrave (Darren Musgrave's spouse, based on publicly available records) is the individual responsible for PBGC's financial records and accounting functions. Key topics include: PBGC's financial records and accounts payable procedures; PBGC's receipt and processing of GAP invoices; PBGC's payment history with GAP and other vendors; PBGC's current financial condition and liquidity; and any knowledge of the Off-Take Agreement and the circumstances of non-payment. This deposition will likely require a half day.

Victor P. Novotny — Vice President of Operations and 10% shareholder of PBGC. Novotny is responsible for PBGC's grain elevator operations, including the receipt, grading, weighing, and storage of grain at PBGC's facilities. Key topics include: the receipt and acceptance of GAP's grain shipments at PBGC's elevator facilities; the procedures for issuing scale tickets and receiving receipts; the October 17, 2021 Macon County elevator fire (cause, extent of damage, impact on operations); and PBGC's continued operations at its remaining five elevator facilities after the fire. Novotny's testimony will be particularly important in confirming delivery and acceptance of the grain underlying the five unpaid invoices. This deposition will likely require a half day.

Kenneth W. Aldrich (Heartland Prairie Bank, SVP Agribusiness Lending) — This deposition should be conducted only if needed and would require a subpoena under Illinois Supreme Court Rule 204. Aldrich is the senior HPB officer responsible for the PBGC lending relationship. Key topics would include: the terms and current status of the HPB credit facility; the nature and extent of HPB's security interest in PBGC's assets; the timeline of PBGC's default and HPB's enforcement actions; any appraisals of PBGC's assets; and HPB's assessment of PBGC's financial condition and ability to satisfy its obligations. We should evaluate the need for this deposition after reviewing the documents obtained through the HPB subpoena. If the documents are sufficiently informative, the deposition may be unnecessary.

Caleb Jennings (GAP, Director of Grain Operations) — While Jennings is our client's witness, we should prepare him for a deposition by defense counsel, which we anticipate will be noticed. Jennings is the individual at GAP who had primary responsibility for the GAP-PBGC relationship, including performance under the Off-Take Agreement, invoicing, the demand and forbearance timeline, and the decision to suspend deliveries on March 8, 2022. We should also prepare Jennings as a potential affiant for the summary judgment motion, as his testimony will be central to establishing GAP's performance and mitigation efforts. I recommend scheduling a preparation session with Jennings in early November 2022 to review the relevant documents and anticipated areas of examination.

Deposition scheduling should begin promptly. I recommend sending deposition notices for Darren Musgrave, Lydia Musgrave, and Victor Novotny by November 15, 2022, with target deposition dates in December 2022 or January 2023. This timeline allows sufficient time to review written discovery responses before conducting depositions, while leaving ample time for follow-up discovery and summary judgment preparation.

V. Defense Counsel Status and Implications

An important tactical consideration that warrants ongoing attention is the status of defense counsel. Bartlett, Reyes Linley CPAs LLP & Harkin LLP (Douglas M. Harkin, lead partner; Nadia C. Petrov, associate) is currently counsel of record for both PBGC and Musgrave as of the date of this memorandum. However, given the indications of PBGC's severe financial distress — including the Heartland Prairie Bank default, the disputed insurance claim, and the hedging losses — there is a meaningful risk that PBGC may be unable to continue paying its litigation counsel's fees.

Under Illinois law, a corporation cannot appear pro se and must be represented by a licensed attorney. See Holzrichter v. Yorath, 2013 IL App (1st) 110287. If Bartlett, Reyes Linley CPAs LLP & Harkin withdraws as counsel for PBGC and PBGC is unable to retain substitute counsel, PBGC would be effectively unable to participate in the litigation — unable to respond to discovery, appear at hearings, oppose motions, or defend at trial.

We should monitor the situation closely for any signs that a withdrawal may be forthcoming. Potential indicators include: delayed or incomplete discovery responses, requests for extensions of deadlines, missed court appearances, or a formal motion to withdraw. If defense counsel does withdraw and PBGC fails to retain substitute counsel within a reasonable time, we should consider the following courses of action:

(a) Accelerating the summary judgment timeline. If PBGC is unrepresented and unable to oppose a summary judgment motion, the motion would be unopposed, substantially increasing the likelihood of a favorable ruling.

(b) Seeking entry of default. If PBGC fails to appear by counsel at scheduled proceedings, we may seek entry of default pursuant to 735 ILCS 5/2-1301(d) for failure to appear or otherwise prosecute its defense. A default judgment on Counts I, III, and IV could be entered without the need for a dispositive motion.

(c) Separate treatment of Musgrave. Note that Musgrave, as an individual, may continue to appear pro se even if PBGC cannot. However, if Bartlett, Reyes Linley CPAs LLP & Harkin withdraws as to both defendants, Musgrave's pro se participation may be limited in scope and effectiveness.

We should not, of course, take any action to induce or accelerate counsel's withdrawal, but we should be prepared to act promptly if the situation develops. This is a matter I will continue to monitor and report on as developments warrant.

VI. Summary Judgment Preparation Timeline

The discovery plan is designed to build toward a motion for summary judgment that can be filed well in advance of the July 28, 2023 dispositive motions deadline. The following is a preliminary timeline for summary judgment preparation:

Phase 1: Receipt and Analysis of discovery Responses (October–November 2022). Following receipt of PBGC's responses to our First Set of Interrogatories and First Request for Production (due on or about October 28, 2022) and Requests for Admission (due November 11, 2022), we will analyze the responses for completeness, sufficiency, and substantive content. If responses are deficient, we will prepare and serve deficiency letters and, if necessary, file a motion to compel under Illinois Supreme Court Rule 219. If the Requests for Admission are not responded to by the November 11, 2022 deadline, they will be deemed admitted, and we should move promptly to capitalize on the deemed admissions.

Phase 2: Depositions and Third-Party discovery (December 2022–February 2023). We will conduct the depositions of Darren Musgrave, Lydia Musgrave, and Victor Novotny, and review documents obtained through third-party subpoenas. The deposition testimony will serve dual purposes: confirming the factual record for summary judgment and developing the financial condition/enforcement record.

Phase 3: Summary Judgment Drafting (February–April 2023). Following completion of key depositions and receipt of third-party subpoena responses, we will begin drafting the summary judgment motion, supporting memorandum of law, and Rule 191 statement of undisputed material facts. The motion will address Counts I, II, III, and IV, supported by the following evidence:

(a) The Off-Take Agreement and all relevant exhibits, including the Musgrave Guaranty (Exhibit D), authenticated through admissions or affidavit.

(b) The five unpaid invoices, authenticated through admissions or the Jennings affidavit.

(c) Delivery and acceptance records from GAP, including delivery tickets, scale tickets, and receiving receipts, authenticated through the Jennings affidavit.

(d) Demand correspondence: the January 25, 2022 Caleb Jennings demand letter and the April 11, 2022 Francesca Morano demand letter, authenticated through the Jennings affidavit and the Morano declaration, respectively.

(e) The February 3, 2022 Musgrave email acknowledging the debt and requesting forbearance, authenticated through production in discovery or through the Jennings affidavit as a business record received in the ordinary course.

(f) The interest calculation spreadsheet prepared by Patrick Gallagher and Diane K. Velasquez, showing accrued interest at 1.5% per month from each invoice due date through the anticipated date of judgment, authenticated through the Jennings affidavit or a separate supporting declaration.

(g) The affidavit of Caleb Jennings, Director of Grain Operations for GAP, attesting to GAP's performance under the Off-Take Agreement, the delivery and acceptance of grain, the invoicing and demand timeline, GAP's forbearance offer and PBGC's failure to make the required partial payment, GAP's suspension of deliveries on March 8, 2022 under Section 8.2, and GAP's mitigation efforts.

Addressing the Failure-to-Mitigate Defense. The summary judgment memorandum will include a section specifically addressing and seeking to dispose of the failure-to-mitigate defense. We will argue:

First, that the duty to mitigate is inapplicable to GAP's claim because GAP seeks recovery of the contract price for goods already delivered and accepted — not damages for lost profits on prospective future deliveries. Under UCC § 2-709 (action for the price) and Illinois case law, a seller who has delivered goods that have been accepted by the buyer is entitled to the contract price without any obligation to mitigate. The concept of mitigation applies where a plaintiff could have reduced its loss by, for example, covering or reselling undelivered goods. Here, the grain was delivered, accepted, and consumed or stored by PBGC, and there is nothing for GAP to resell or cover.

Second, that even if the duty to mitigate applies, GAP satisfied it. The undisputed record establishes that GAP demanded payment, offered forbearance conditioned on partial payment, and promptly suspended further deliveries when PBGC failed to make even the required partial payment. GAP acted within one week of the missed March 1, 2022 deadline to cut its losses. No reasonable juror could find that GAP failed to take reasonable steps to minimize its damages.

Third, that PBGC has failed to identify any specific action GAP could have taken to reduce its damages or any specific amount of damages that would have been avoided. Under Illinois law, the burden of proving failure to mitigate rests on the defendant, and a defendant that cannot identify specific mitigation opportunities and quantify the damages that would have been avoided cannot sustain this defense. See Siegel v. Levy Organization Development Co., 153 Ill.2d 534, 543 (1992).

Phase 4: Filing and Briefing (April–July 2023). We anticipate filing the motion for summary judgment in April or May 2023, well in advance of the July 28, 2023 deadline. This allows sufficient time for PBGC's response and GAP's reply under the applicable briefing schedule, and positions the motion for ruling before the September 15, 2023 pretrial conference.

If the Requests for Admission are deemed admitted due to PBGC's failure to respond by the November 11, 2022 deadline, we should consider accelerating this timeline significantly and filing the motion for summary judgment as early as December 2022 or January 2023.

VII. Budget and Staffing Considerations

The following staffing assignments and budget considerations apply to the discovery phase and summary judgment preparation:

Staffing.

Hannah Brinkley and Patrick Gallagher will handle the bulk of day-to-day discovery work, including reviewing and analyzing discovery responses, preparing follow-up discovery, drafting subpoenas, and preparing deposition outlines. Francesca Morano will provide strategic oversight, attend key depositions (primarily Darren Musgrave), interface with the client, and supervise the summary judgment briefing. Diane K. Velasquez and Ryan T. Marbury will manage document organization, assist with deposition preparation (including preparing exhibit binders), and handle logistical matters such as subpoena service, deposition scheduling, and court filings.

Estimated Additional discovery Costs. In addition to attorney and paralegal time, we anticipate the following hard costs:

• Deposition reporter fees: estimated $2,500–$4,000 per deposition (three to five depositions anticipated), for a total of approximately $7,500–$20,000.

• Subpoena service costs: estimated $200–$400 per subpoena (three subpoenas anticipated), for a total of approximately $600–$1,200.

• Expert fees: We do not anticipate retaining an expert on damages or interest calculation, as the claim is for a straightforward contract price with contractual interest, and the interest calculation can be presented through a lay witness (Caleb Jennings) or through counsel's summary exhibit. If PBGC retains a damages expert in connection with its mitigation defense, we may need to reconsider this assessment.

• Copying, messenger, and filing costs: estimated $500–$1,500.

Budget Discussion with Client. I recommend that we schedule a client update call or meeting with GAP (likely Caleb Jennings and GAP's in-house counsel, if any) to discuss the current status of the case, the discovery plan, the estimated budget for the discovery and summary judgment phases, and the enforcement outlook. We should provide GAP with a candid assessment of the recovery prospects given PBGC's financial distress and Heartland Prairie Bank's senior secured position. Total fees billed to date and projected additional fees through summary judgment should be reviewed at that time. GAP should also be consulted on its appetite for pursuing settlement versus full litigation, as the enforcement analysis may significantly affect this calculus.

VIII. Recommended Next Steps

Based on the foregoing analysis, I recommend the following action items, in approximate chronological order:

1. Monitor Response Deadlines. Calendar and monitor PBGC's deadlines to respond to the First Set of Interrogatories and First Request for Production (on or about October 28, 2022) and the Requests for Admission (November 11, 2022). Assign Diane K. Velasquez to confirm that all deadlines are properly calendared in the firm's docketing system and to send reminder alerts at 14 days and 7 days prior to each deadline.

2. Prepare Follow-Up discovery. Following receipt and review of PBGC's discovery responses, prepare deficiency letters identifying any incomplete, evasive, or otherwise insufficient responses. If deficiencies are not cured within a reasonable time (14 days), prepare and file a motion to compel under Illinois Supreme Court Rule 219, seeking an order compelling complete responses and, if warranted, sanctions for discovery abuse.

3. Prepare and Serve discovery to Musgrave. Prepare and serve Plaintiff's First Set of Interrogatories and First Request for Production of Documents directed to Darren K. Musgrave individually, focusing on personal financial condit

PRIVILEGED AND CONFIDENTIAL — ATTORNEY WORK PRODUCT
CALDERWOOD & HARKNESS LLP INTEROFFICE MEMORANDUM
TO: Francesca Morano, Partner
FROM: Hannah Brinkley, Associate
DATE: September 20, 2022
RE: discovery Strategy — Greenfield Agricultural Partners LLC v. Prairie Basin Grain Co. et al., Circuit Court of Cook County, Illinois, Case No. 2022-L-004831
MATTER NO.: C&H Matter No. 1020-00005
PRIVILEGE DESIGNATION: This memorandum is protected by the attorney-client privilege and the work product doctrine. It is prepared in anticipation of litigation and for the purpose of providing legal advice to our client, Greenfield Agricultural Partners LLC. This memorandum contains mental impressions, conclusions, opinions, and legal theories of counsel. Do not distribute outside of the Calderwood & Harkness LLP engagement team without prior authorization from Francesca Morano.
I. Purpose and Summary
The purpose of this memorandum is to set forth a comprehensive discovery plan for the above-referenced litigation following two significant procedural developments: (1) the August 22, 2022 ruling by the Honorable Patricia Delacroix granting Greenfield Agricultural Partners LLC's ("GAP") Motion to Strike the force majeure and commercial impracticability affirmative defenses asserted by Prairie Basin Grain Co. ("PBGC"); and (2) the September 12, 2022 Case Management Conference at which Judge Delacroix established the discovery schedule and related case management deadlines. Together, these developments substantially narrow the contested issues and create a clear pathway toward resolution of this matter, provided that our discovery efforts are targeted and efficient.
The discovery plan outlined herein is designed to serve three primary objectives:
First, establishing the full amount owed under the Master Grain Purchase and Off-Take Agreement dated March 15, 2019 (the "Off-Take Agreement") and defeating PBGC's sole surviving affirmative defense — failure to mitigate damages. With the force majeure and commercial impracticability defenses eliminated by the court's August 22 ruling, the failure-to-mitigate defense is the only remaining obstacle to establishing PBGC's liability on all claims. Our discovery must foreclose this defense both factually and legally.
Second, developing a thorough understanding of PBGC's financial condition and asset base, as well as the personal financial condition of co-defendant Darren K. Musgrave, for purposes of judgment enforcement. Given the significant sums at issue — $4,870,050.00 in unpaid principal, plus contractual interest accruing at 1.5% per month — and the indications that PBGC is under severe financial distress, early assessment of enforcement prospects is essential to advising our client on whether to pursue an aggressive litigation timeline, consider settlement, or both.
Third, building the evidentiary foundation necessary to support a motion for summary judgment on all counts. The nature of GAP's claims — breach of a written contract for the price of goods delivered and accepted, breach of a written personal guaranty, and account stated — is well-suited to summary disposition if the factual record is properly developed through admissions, authenticated documents, and uncontested evidence.
As noted below, written discovery was served on September 30, 2022 (Plaintiff's First Set of Interrogatories to PBGC and Plaintiff's First Request for Production of Documents to PBGC), and Plaintiff's Requests for Admission to PBGC were served on October 14, 2022. This memorandum outlines the strategic framework behind those discovery vehicles, identifies anticipated additional discovery directed at Musgrave individually and at relevant third parties, and sets forth the recommended timeline for depositions, summary judgment preparation, and related next steps.
II. Current Procedural Posture
A. Pleadings Status
GAP filed its Verified Complaint on May 9, 2022, asserting four counts arising from PBGC's failure to pay for grain delivered under the Off-Take Agreement:
Count I — Breach of Contract (Off-Take Agreement) against PBGC. GAP alleges that PBGC breached Sections 4.1 and 7.1 of the Off-Take Agreement by failing to pay for grain duly delivered and accepted at PBGC's elevator facilities. The principal amount owed is $4,870,050.00, representing five unpaid invoices issued between September 28, 2021 and January 19, 2022. GAP further seeks contractual interest at the rate of 1.5% per month (18% per annum) on all overdue amounts pursuant to Section 7.3 of the Off-Take Agreement, which provides that "[a]ll amounts not paid when due shall bear interest at the rate of one and one-half percent (1.5%) per month from the date due until the date paid in full."
Count II — Breach of Personal Guaranty against Darren K. Musgrave. As an inducement to GAP's entry into the Off-Take Agreement, Musgrave executed a Personal Guaranty of Payment (attached to the Off-Take Agreement as Exhibit D) guaranteeing PBGC's payment obligations up to an aggregate cap of $2,000,000. GAP alleges that Musgrave's obligations under the Guaranty have been triggered by PBGC's failure to pay amounts due under the Off-Take Agreement, and that Musgrave has failed to honor his guaranty obligations despite demand.
Count III — Account Stated against PBGC. GAP alleges that PBGC received and retained the five invoices without objection, and that Musgrave's February 3, 2022 email acknowledging the debt and requesting forbearance constitutes an acknowledgment of the account stated. The amounts due on the account stated are identical to the amounts claimed under Count I.
Count IV — Unjust Enrichment (Alternative) against PBGC. Pleaded in the alternative, GAP alleges that PBGC received the benefit of the grain delivered by GAP and has been unjustly enriched by its failure to pay.
Service of process was completed on May 24, 2022. PBGC was served through its registered agent, Ridgeline Corporate Services LLC, in accordance with 735 ILCS 5/2-204. Musgrave was personally served at his residence at 1188 Windermere Lane, Champaign, Illinois 61822, by a Cook County process server.
Defendants, through their counsel Bartlett, Reyes Linley CPAs LLP & Harkin LLP (Douglas M. Harkin, lead partner; Nadia C. Petrov, associate), filed their Answer and Affirmative Defenses on June 27, 2022. The Answer largely denied the material allegations of the Complaint, though notably it did not deny the existence or authenticity of the Off-Take Agreement itself. Defendants asserted three affirmative defenses:
First Affirmative Defense — Force Majeure. PBGC alleged that the October 17, 2021 fire at its Macon County grain elevator facility constituted a force majeure event under Section 9.1 of the Off-Take Agreement, excusing PBGC's performance obligations.
Second Affirmative Defense — Commercial Impracticability. PBGC alleged that the combined effect of the Macon County fire, disruptions in the grain market, and the resulting financial strain rendered its performance commercially impracticable within the meaning of Section 2-615 of the Uniform Commercial Code as adopted in Illinois.
Third Affirmative Defense — Failure to Mitigate. PBGC alleged that GAP failed to take reasonable steps to mitigate its damages, including by failing to resell undelivered grain at market prices and by failing to accept partial payment in lieu of the full amounts due.
B. Motion to Strike Ruling — August 22, 2022
On July 15, 2022, GAP moved to strike all three affirmative defenses pursuant to 735 ILCS 5/2-615, arguing that none stated a legally sufficient defense. Following full briefing and oral argument on August 18, 2022, Judge Delacroix issued her ruling on August 22, 2022, granting GAP's motion in part and denying it in part.
The court struck the force majeure defense on two independent grounds. First, the court held that the force majeure clause in Section 9.1 of the Off-Take Agreement, by its plain terms, excuses only delays or failures in the physical delivery or receipt of grain — not payment obligations. The court cited the limiting language in Section 9.1 that references "performance of delivery or receipt obligations" and noted the absence of any language extending force majeure relief to payment obligations. Second, the court found that even if the clause could be read to apply to payment obligations, PBGC failed to allege facts showing that the Macon County fire rendered payment impossible or impracticable, given that the fire affected only one of PBGC's six grain elevator facilities and that PBGC continued to operate its remaining five facilities during the relevant period.
The court struck the commercial impracticability defense on the ground that financial difficulty, standing alone, does not constitute commercial impracticability under Illinois law. The court cited Kel Kim Corp. v. Central Markets, Inc., 70 N.Y.2d 900 (1987), and the Restatement (Second) of Contracts § 261, cmt. d, both of which have been adopted by Illinois courts, for the proposition that mere increases in cost or financial hardship do not excuse contractual obligations absent supervening impossibility of performance. The court noted that PBGC's allegations amounted to financial difficulty caused by a combination of factors — the elevator fire, hedging losses, and market conditions — none of which rendered payment impossible as opposed to merely burdensome.
The court denied GAP's motion as to the failure-to-mitigate defense, finding that PBGC had adequately pleaded facts suggesting that GAP may have had opportunities to reduce its damages by reselling undelivered grain or taking other steps to minimize losses. While the court did not express any view on the merits of this defense, it held that the defense was not facially insufficient at the pleading stage and could be tested through discovery and, if appropriate, summary judgment.
This ruling is of critical importance. The elimination of the force majeure and commercial impracticability defenses means that PBGC has no viable defense to liability for its failure to pay for grain that was delivered and accepted. The sole remaining issue is whether GAP failed to mitigate its damages, and as discussed in Section III.B below, this defense is factually weak and may be legally inapplicable given the nature of GAP's claims.
C. Case Management Conference — September 12, 2022
At the September 12, 2022 Case Management Conference, Judge Delacroix established the following discovery schedule by written order:
The schedule provides approximately six months for fact discovery and an additional three months for expert discovery. For the reasons set forth herein, we believe that the nature of this case — a straightforward claim for the contract price of goods delivered, supported by written agreements and invoices — may allow us to complete discovery well in advance of these deadlines and move for summary judgment on or before the July 28, 2023 dispositive motions deadline. An accelerated timeline is particularly desirable given the concerns regarding PBGC's financial condition and the risk of asset dissipation.
III. Discovery Objectives
A. Objective 1: Establish the Debt and Eliminate Remaining Defenses
The first and most fundamental objective of our discovery plan is to confirm, through binding admissions and documentary evidence, the core elements of GAP's breach of contract claim: the existence of the Off-Take Agreement, GAP's performance (delivery and acceptance of grain), PBGC's breach (non-payment), and the amount of damages.
Authentication of the Off-Take Agreement and Related Documents. Our Requests for Admission seek to confirm the authenticity and due execution of the Master Grain Purchase and Off-Take Agreement dated March 15, 2019, including all exhibits thereto. The most critical exhibits for our purposes are Exhibit B (the quarterly basis differential schedule, which governs pricing), and Exhibit D (the Musgrave Personal Guaranty of Payment, which is the foundation of Count II). While Defendants' Answer did not deny the existence of the Off-Take Agreement, they did not affirmatively admit its authenticity, and we need binding admissions or other authenticated copies to support summary judgment.
Confirmation of Delivery and Acceptance. Our discovery seeks to confirm through admissions, documents, and testimony that PBGC received and accepted all grain shipments underlying the five unpaid invoices. The invoices, amounts, and key details are as follows:
Each of these invoices was issued in accordance with Section 7.1 of the Off-Take Agreement, which provides for payment within thirty (30) days of the invoice date. GAP's records reflect that each delivery was made to the specified PBGC elevator facility and that PBGC issued weight tickets or receiving receipts acknowledging receipt and quality grade. Our document requests seek production of PBGC's own receiving records, scale tickets, and any internal communications confirming receipt and acceptance.
Confirmation of Non-Payment and Interest. Our Requests for Admission directly ask PBGC to admit that no payment has been made on any of the five invoices. Our interrogatories ask PBGC to identify any payments made and the dates thereof. The contractual interest rate of 1.5% per month (18% per annum) under Section 7.3 is a significant component of the total recovery. Patrick Gallagher and Diane K. Velasquez have prepared an interest calculation spreadsheet showing accrued interest from each invoice's due date through the anticipated date of judgment. As of October 1, 2022, the accrued interest exceeds $600,000 and continues to grow at approximately $73,000 per month.
Attorneys' Fees Provision. Section 12.4 of the Off-Take Agreement provides that "[i]n any action or proceeding arising out of or relating to this Agreement, the prevailing party shall be entitled to recover its reasonable attorneys' fees, costs, and expenses." This provision will be significant at the judgment stage. Our Requests for Admission seek confirmation of the existence and terms of this provision. Our discovery into PBGC's financial condition is also relevant to assessing whether an award of attorneys' fees will be collectible.
B. Objective 2: Defeat the Failure-to-Mitigate Defense
The failure-to-mitigate defense is PBGC's sole remaining affirmative defense, and it is, in our assessment, both legally questionable and factually unsupported. Nevertheless, it must be addressed comprehensively through discovery to foreclose any argument at the summary judgment stage.
Identifying PBGC's Theory. As a threshold matter, our interrogatories require PBGC to state with specificity the factual basis for its failure-to-mitigate defense, including: (a) what actions PBGC contends GAP should have taken to mitigate; (b) when GAP should have taken those actions; (c) what damages would have been avoided had GAP acted as PBGC contends it should have; and (d) the identity of all persons with knowledge of facts supporting this defense. PBGC's Answer offered only conclusory allegations, and we need to force PBGC to commit to a specific theory that can be tested and refuted.
Establishing GAP's Reasonable Mitigation Efforts. The documentary record already in GAP's possession demonstrates that GAP acted promptly and reasonably in response to PBGC's non-payment. The timeline of relevant events is as follows:
January 25, 2022: Caleb Jennings, GAP's Director of Grain Operations, sent a formal written demand to PBGC for payment of the first three invoices (GAP-2021-3187, GAP-2021-3244, and GAP-2021-3301), totaling $3,053,250.00. The demand letter was sent by certified mail and email to Darren K. Musgrave at PBGC's principal office in Champaign, Illinois.
February 3, 2022: Musgrave responded to Jennings by email, acknowledging the debt and the amounts owed. Musgrave stated that PBGC was "experiencing temporary cash flow difficulties" and requested a 90-day forbearance, explaining that PBGC was "in active negotiations with Heartland Prairie Bank for additional financing that [would] allow [PBGC] to bring all accounts current." This email is highly significant for multiple purposes: it constitutes an admission of the debt (supporting Count III, Account Stated), it negates any claim that GAP failed to communicate or cooperate with PBGC, and it provides context for GAP's decision to extend limited forbearance.
February 14, 2022: GAP, through Caleb Jennings, agreed to a 60-day forbearance (not the 90 days Musgrave requested) conditioned on PBGC making a partial payment of Invoice GAP-2021-3187 ($892,500.00) by March 1, 2022. This conditional forbearance was confirmed in writing and demonstrates GAP's willingness to work with PBGC to resolve the situation — the opposite of a party failing to mitigate.
March 1, 2022: PBGC failed to make the required partial payment. No payment was received on March 1, 2022 or at any time thereafter.
March 8, 2022: Less than one week after PBGC's failure to make the required partial payment, GAP suspended further deliveries under Section 8.2 of the Off-Take Agreement (Adequate Assurance of Performance). Section 8.2 provides that "[i]f reasonable grounds for insecurity arise with respect to the performance of either party, the other party may in writing demand adequate assurance of due performance and may, if commercially reasonable, suspend any performance for which it has not already received the agreed return until such assurance is received." GAP's suspension of deliveries on March 8 demonstrates that GAP acted promptly to cut its losses and prevent further unpaid deliveries — which is the very essence of mitigation.
April 11, 2022: Francesca Morano sent a formal demand letter on behalf of GAP to PBGC and Musgrave, demanding payment of all five unpaid invoices totaling $4,870,050.00 plus accrued interest, and notifying Musgrave of GAP's intent to enforce the Personal Guaranty.
May 9, 2022: GAP filed the present action.
discovery Directed at the Mitigation Defense. In addition to the interrogatories requiring PBGC to specify its theory, our document requests seek production of any communications between PBGC and third parties regarding alternative grain sourcing, or any evidence that GAP could have resold undelivered grain at comparable or near-comparable market prices to reduce its damages. We also seek production of any market data or analysis PBGC may have relied upon in formulating its mitigation defense. If PBGC cannot produce any such evidence — and we believe it is unlikely that such evidence exists — the defense will be unsupported and subject to disposition on summary judgment.
Strategic Assessment. The failure-to-mitigate defense is weak for several reasons. Most fundamentally, GAP's claim is for the contract price of goods already delivered and accepted — not for lost profits on prospective future deliveries. Under Illinois law, the duty to mitigate generally requires a plaintiff to take reasonable steps to minimize losses from a breach, but that duty does not require a seller to seek out alternative buyers for goods that have already been delivered to and accepted by the breaching party. See Midland Hotel Corp. v. Reuben H. Donnelley Corp., 118 Ill.2d 306, 317 (1987). The five invoices at issue all represent grain that was physically delivered to PBGC's elevator facilities, weighed, inspected, accepted, and placed into PBGC's storage or processing operations. There is simply nothing for GAP to "mitigate" with respect to those completed transactions.
Even if the duty to mitigate is somehow found to apply, GAP's conduct was objectively reasonable. GAP demanded payment, agreed to limited forbearance conditioned on a partial payment, and when PBGC failed to make even that partial payment, GAP suspended further deliveries within one week. GAP then made a formal demand through counsel and filed suit within approximately two months. No reasonable argument can be made that GAP was dilatory or failed to act to protect its interests.
Finally, the burden of proving failure to mitigate rests on PBGC as the party asserting the defense. See Siegel v. Levy Organization Development Co., 153 Ill.2d 534, 543 (1992). If PBGC cannot identify, through discovery, any specific action GAP should have taken or any specific amount of damages that would have been avoided, the defense fails as a matter of law.
C. Objective 3: Assess PBGC's Financial Condition and Asset Base (Enforcement)
Even before obtaining judgment, discovery into PBGC's financial condition and asset base is critical for multiple reasons. First, it allows us to assess the realistic prospects for collecting on a judgment against PBGC and to determine whether the Musgrave Guaranty represents a more viable path to recovery. Second, it informs our advice to the client regarding settlement — if PBGC is effectively judgment-proof due to Heartland Prairie Bank's senior secured position, a negotiated resolution that captures available value may be preferable to incurring the costs of trial. Third, it allows us to identify any potential fraudulent transfer or asset dissipation issues that might warrant additional claims or emergency relief.
Interrogatories Regarding Financial Condition. Our interrogatories directed at PBGC seek the following categories of financial information:
(a) Identification of all bank accounts held by PBGC at any financial institution, including the name and address of each institution, account numbers, and current balances as of the most recent statement date.
(b) Identification of all real property owned or leased by PBGC, including the six grain elevator facilities located in Champaign, Macon, and Piatt Counties. For each property, we seek the legal description, current fair market value, any mortgages or liens encumbering the property, and the identity of any tenants or sublessees.
(c) All outstanding secured and unsecured indebtedness, with particular emphasis on the Heartland Prairie Bank Revolving Credit and Term Loan Agreement dated June 1, 2018. Based on information available from public filings and our client's knowledge, the HPB facility has an aggregate commitment of approximately $45 million, and the outstanding balance as of April 2022 (when HPB reportedly declared a default) was approximately $31.4 million. The terms, collateral, and current status of this facility are critical to assessing whether any unencumbered assets exist against which a GAP judgment could be enforced.
(d) A list of all pending litigation and claims against PBGC, including any actions by Heartland Prairie Bank to enforce its security interest, any actions by other creditors, and any regulatory proceedings.
(e) The status of PBGC's insurance claim with Triton Mutual Insurance Co. arising from the October 17, 2021 fire at the Macon County grain elevator facility. The estimated loss from the fire is approximately $3.2 million. Our understanding is that coverage under the property insurance policy may be disputed due to an alleged lapse in premium payments — a fact that, if true, would further confirm PBGC's severe financial distress. Any insurance proceeds recovered by PBGC would potentially be available to satisfy creditor claims, although the priority of such proceeds relative to Heartland Prairie Bank's security interest must be analyzed.
(f) Details regarding PBGC's Q4 2021 hedging losses. Based on information provided by our client and from industry sources, PBGC sustained estimated losses of approximately $6.8 million in mark-to-market losses on short corn futures positions during the fourth quarter of 2021, when corn prices spiked due to supply chain disruptions and strong export demand. These hedging losses appear to be the primary cause of PBGC's liquidity crisis and its inability to pay GAP and other creditors.
Document Requests Regarding Financial Condition. Our document requests seek:
(a) PBGC's audited financial statements for fiscal years 2020 and 2021. These statements were prepared by Mercer Tidwell & Associates PC (engagement partner Joan F. Tidwell), a Champaign-based accounting firm. If PBGC fails to produce these statements, we will subpoena them directly from Mercer Tidwell.
(b) Monthly or quarterly internally prepared financial statements for 2022, including balance sheets, income statements, and cash flow statements.
(c) All loan agreements, security agreements, promissory notes, and related documents evidencing the Heartland Prairie Bank credit facility, including any amendments, modifications, or forbearance agreements. We also seek all UCC financing statements filed by Heartland Prairie Bank with the Illinois Secretary of State.
(d) All communications between PBGC (including Musgrave, Lydia R. Musgrave, and Victor P. Novotny) and any representative of Heartland Prairie Bank, including Kenneth W. Aldrich (SVP, Agribusiness Lending), regarding PBGC's default under the credit facility, any workout discussions, and any enforcement actions taken or threatened.
(e) All insurance policies issued by Triton Mutual Insurance Co. to PBGC, and all correspondence, claim submissions, adjusters' reports, coverage determinations, and related documents regarding the Macon County elevator fire.
(f) All hedging account statements, brokerage agreements, margin call notices, and related records for PBGC's commodity hedging accounts for Q3 and Q4 2021.
Assessment of Enforcement Prospects. The purpose of this financial discovery is to enable us to provide GAP with a realistic assessment of its recovery prospects. The preliminary picture is concerning. If Heartland Prairie Bank holds a prior perfected security interest under UCC Article 9 that effectively blankets all of PBGC's assets — including accounts receivable, inventory, equipment, and general intangibles — then GAP may find that even after obtaining a judgment, there are insufficient unencumbered assets to satisfy it. The outstanding balance on the HPB facility ($31.4 million) against aggregate assets that we estimate at approximately $35–40 million suggests that the equity cushion may be thin or nonexistent, particularly after accounting for the Macon County fire losses, hedging losses, and other creditor claims.
The Musgrave Guaranty as an Alternative Recovery Path. If PBGC is effectively judgment-proof due to Heartland Prairie Bank's senior secured position, recovery under the Musgrave Personal Guaranty — capped at $2,000,000 — may represent the most viable path to meaningful recovery for GAP. Discovery into Musgrave's personal financial condition will be necessary to assess this avenue. His residence at 1188 Windermere Lane, Champaign, Illinois 61822 may have significant equity, and he may have other personal assets (investment accounts, other real property, interests in other entities) that could be reached to satisfy a guaranty judgment. Separate discovery directed to Musgrave individually, as discussed in Section IV.B.1 below, will be essential.
D. Objective 4: Foundation for Summary Judgment
The discovery plan is specifically designed to build the evidentiary record necessary to support a motion for summary judgment on all four counts. Given the straightforward nature of the breach of contract and account stated claims, and the weakness of the sole remaining affirmative defense, this case is well-suited for summary disposition.
Requests for Admission as the Cornerstone. The Requests for Admission served on October 14, 2022 are the most critical component of our summary judgment strategy. They are carefully drafted to establish, if admitted or deemed admitted, each element of the breach of contract, breach of guaranty, and account stated claims:
(a) The Off-Take Agreement is a genuine and authentic document executed by Darren K. Musgrave on behalf of PBGC and by Caleb Jennings on behalf of GAP.
(b) Exhibit D to the Off-Take Agreement — the Musgrave Personal Guaranty of Payment — is a genuine and authentic document executed by Darren K. Musgrave in his individual capacity.
(c) Each of the five invoices identified in the Complaint (GAP-2021-3187, GAP-2021-3244, GAP-2021-3301, GAP-2021-3358, and GAP-2022-0042) was issued by GAP to PBGC and received by PBGC.
(d) The grain described in each of the five invoices was delivered by GAP to PBGC's designated elevator facility and accepted by PBGC.
(e) The amounts stated on each invoice are accurate and reflect the contract price for the grain delivered.
(f) No payment has been made by PBGC or Musgrave on any of the five invoices.
(g) Section 7.3 of the Off-Take Agreement provides for interest on overdue amounts at the rate of 1.5% per month.
(h) Section 12.4 of the Off-Take Agreement provides for recovery of attorneys' fees by the prevailing party.
Deemed Admissions Under Illinois Supreme Court Rule 216. Under Illinois Supreme Court Rule 216(a), a party served with Requests for Admission must respond within 28 days. If PBGC fails to respond by the November 11, 2022 deadline, all requests are deemed admitted. Deemed admissions under Rule 216 are conclusive and cannot be withdrawn except by leave of court upon a showing of good cause. Given PBGC's apparent financial distress — and the possibility that its counsel may be experiencing difficulty securing payment for legal fees — there is a meaningful possibility that PBGC will fail to respond timely or at all.
Combined Effect with the August 22 Ruling. If the Requests for Admission are admitted or deemed admitted, and combined with the court's August 22, 2022 ruling striking the force majeure and commercial impracticability defenses, all elements of Counts I (breach of contract), Count II (breach of guaranty), and Count III (account stated) will be established by undisputed evidence. The only remaining issue for summary judgment briefing would be the failure-to-mitigate defense, which, as discussed in Section III.B, is both legally and factually deficient.
Supporting Documentary Evidence. Even apart from the Requests for Admission, GAP's own records provide robust documentary support for summary judgment:
• The executed Off-Take Agreement and all exhibits, including the Musgrave Guaranty.
• Copies of all five invoices with delivery tickets and PBGC receiving receipts.
• The January 25, 2022 demand letter from Caleb Jennings.
• The February 3, 2022 email from Darren Musgrave acknowledging the debt.
• The February 14, 2022 conditional forbearance agreement.
• The March 8, 2022 suspension notice under Section 8.2.
• The April 11, 2022 demand letter from Francesca Morano.
Caleb Jennings, GAP's Director of Grain Operations, can provide an affidavit authenticating all of GAP's business records under the Illinois business records exception to the hearsay rule (735 ILCS 5/8-401) and attesting to the facts of performance, delivery, invoicing, demand, forbearance, and suspension. Patrick Gallagher and Diane K. Velasquez have prepared an interest calculation spreadsheet that can be incorporated into Jennings' affidavit or submitted as an exhibit with a separate supporting declaration.
IV. Discovery Plan — Specific Vehicles
A. Written discovery Already Served
1. Plaintiff's First Set of Interrogatories to PBGC (served September 30, 2022). The First Set of Interrogatories contains twenty-five interrogatories (the maximum permitted under Cook County Local Rule 206(a) without leave of court) directed at PBGC. The key interrogatories are organized around the following subject areas:
Financial Condition and Assets (Interrogatories 1–8): These interrogatories require PBGC to identify all bank accounts and financial institutions, all real property owned or leased (including the six grain elevator facilities in Champaign, Macon, and Piatt Counties), all outstanding secured and unsecured indebtedness, all pending litigation and claims, and all material changes in financial condition since December 31, 2021. Interrogatory No. 5 specifically addresses the Heartland Prairie Bank Revolving Credit and Term Loan Agreement, including the original terms, outstanding balance, default status, and any workout or forbearance arrangements. Interrogatory No. 6 addresses the Triton Mutual Insurance Co. claim for the Macon County elevator fire, including the date of the claim submission, the current status, any coverage disputes, and the amount of any proceeds received or expected. Interrogatory No. 7 addresses PBGC's hedging activities in Q3 and Q4 2021, including the nature and size of positions, the identity of the brokerage firm, the amount of realized and unrealized losses, and any margin calls.
Off-Take Agreement and Performance (Interrogatories 9–14): These interrogatories require PBGC to identify all persons involved in the negotiation and execution of the Off-Take Agreement, all persons with knowledge of PBGC's performance or non-performance thereunder, all communications between PBGC and GAP regarding the Off-Take Agreement, all payments made by PBGC on any invoices issued by GAP, and the reasons for PBGC's failure to pay the five invoices at issue.
Failure-to-Mitigate Defense (Interrogatories 15–19): These interrogatories are specifically designed to require PBGC to articulate its failure-to-mitigate theory with precision. Interrogatory No. 15 asks PBGC to identify with specificity each action that GAP allegedly should have taken to mitigate its damages. Interrogatory No. 16 asks PBGC to state when each such action should have been taken. Interrogatory No. 17 asks PBGC to state the amount of damages that would have been avoided had GAP taken each identified action. Interrogatory No. 18 asks PBGC to identify all evidence — documentary or testimonial — that supports the failure-to-mitigate defense. Interrogatory No. 19 asks PBGC to identify any communications between PBGC and third parties regarding alternative grain sourcing that would suggest GAP had available opportunities to resell undelivered grain.
Witnesses and Experts (Interrogatories 20–25): These interrogatories require PBGC to identify all fact witnesses with knowledge of the matters alleged in the Complaint and Answer, all persons who participated in communications with GAP or Heartland Prairie Bank regarding PBGC's financial condition, and any experts PBGC intends to retain.
PBGC's responses are due 28 days from service — i.e., on or about October 28, 2022.
2. Plaintiff's First Request for Production of Documents to PBGC (served September 30, 2022). The First Request for Production contains thirty-two document requests organized into the following categories:
Category A — Contract Documents (Requests 1–5): The Off-Take Agreement and all exhibits, schedules, amendments, and modifications; all correspondence and communications between GAP and PBGC relating to the Off-Take Agreement; all purchase orders, confirmations, and related transactional documents; all invoices issued by GAP and received by PBGC; and all delivery tickets, scale tickets, receiving receipts, and quality inspection records.
Category B — Payment Records (Requests 6–9): All records of payments made by PBGC to GAP, including cancelled checks, wire transfer confirmations, and ledger entries; all internal communications regarding PBGC's decision to withhold payment on the five invoices; all communications with GAP regarding payment, forbearance, or settlement; and all accounts payable records reflecting amounts owed to GAP.
Category C — Financial Statements and Records (Requests 10–16): PBGC's audited financial statements for FY 2020 and FY 2021 as prepared by Mercer Tidwell & Associates PC; monthly or quarterly internally prepared financial statements for January through September 2022; tax returns for FY 2020 and FY 2021; general ledger and chart of accounts; accounts receivable aging reports; and any budgets, forecasts, or financial projections prepared in 2021 or 2022.
Category D — Heartland Prairie Bank (Requests 17–21): All loan agreements, promissory notes, security agreements, and related documents evidencing the revolving credit and term loan facility; all UCC financing statements filed by Heartland Prairie Bank; all correspondence with Kenneth W. Aldrich or any other HPB representative regarding PBGC's financial condition, default, or workout; any forbearance or standstill agreements; and any appraisals of PBGC's assets prepared for or at the request of Heartland Prairie Bank.
Category E — Triton Mutual Insurance Co. (Requests 22–25): All property insurance policies issued by Triton Mutual to PBGC; all claim submissions and supporting documentation relating to the October 17, 2021 Macon County elevator fire; all coverage determination letters, adjuster reports, and related correspondence; and all premium payment records for the two-year period preceding the fire.
Category F — Hedging and Brokerage Records (Requests 26–28): All brokerage account agreements and statements for PBGC's commodity hedging accounts for Q3 and Q4 2021; all margin call notices and related correspondence; and all internal communications regarding PBGC's hedging strategy and losses.
Category G — Mitigation and Miscellaneous (Requests 29–32): All documents relating to or supporting PBGC's failure-to-mitigate defense; all communications between PBGC and any third party regarding alternative grain sourcing or the availability of grain from sources other than GAP; all organizational documents for PBGC (articles of organization, operating agreement, amendments); and all documents relating to any distributions, dividends, or transfers of assets from PBGC to any member, officer, or affiliate since January 1, 2021.
PBGC's responses are due 28 days from service — i.e., on or about October 28, 2022.
3. Plaintiff's Requests for Admission to PBGC (served October 14, 2022). As discussed in Section III.D above, the Requests for Admission contain twenty-two individually numbered requests targeting the core elements of each claim. The key admissions sought are:
(a) Authenticity and due execution of the Off-Take Agreement by Darren K. Musgrave on behalf of PBGC (Requests Nos. 1–3).
(b) Authenticity and due execution of the Musgrave Personal Guaranty of Payment (Exhibit D) by Darren K. Musgrave individually (Requests Nos. 4–5).
(c) Issuance and receipt by PBGC of each of the five invoices identified by number (Requests Nos. 6–10).
(d) Delivery of the grain described in each invoice to PBGC's designated elevator facility (Requests Nos. 11–15).
(e) Acceptance of the grain by PBGC and the accuracy of the amounts stated on each invoice (Requests Nos. 16–17).
(f) Non-payment — admission that no payment has been made by PBGC or Musgrave on any of the five invoices (Request No. 18).
(g) That Section 7.3 of the Off-Take Agreement provides for interest at 1.5% per month on overdue amounts (Request No. 19).
(h) That Section 12.4 of the Off-Take Agreement provides for the prevailing party to recover reasonable attorneys' fees (Request No. 20).
(i) That Musgrave received the April 11, 2022 demand letter from Francesca Morano (Request No. 21).
(j) That the Musgrave Guaranty guarantees payment of PBGC's obligations under the Off-Take Agreement up to $2,000,000 (Request No. 22).
The deadline for PBGC's responses is November 11, 2022. As noted, failure to respond within 28 days results in deemed admissions under Illinois Supreme Court Rule 216(a).
B. Anticipated Additional discovery
1. Interrogatories and Document Requests Directed to Darren K. Musgrave Individually. We recommend serving a separate set of interrogatories and document requests on Musgrave in his individual capacity as a co-defendant and the obligor under the Personal Guaranty. This discovery should focus on the following areas:
Personal Financial Condition and Assets: Musgrave should be required to identify all personal bank and brokerage accounts, all real property owned individually or jointly with his spouse (including the residence at 1188 Windermere Lane, Champaign, IL 61822, and any other properties), all retirement accounts and investments, all sources of personal income (including salary and distributions from PBGC), all personal indebtedness and obligations, and any transfers of personal assets exceeding $10,000 made since January 1, 2021.
Enforceability of the Guaranty: While we do not anticipate a serious challenge to the enforceability of the Guaranty, we should request documents confirming that the Guaranty was executed voluntarily and with full understanding of its terms. We should also seek production of any communications in which Musgrave acknowledged or discussed his obligations under the Guaranty.
This discovery should be prepared and served promptly. I recommend a target service date of no later than October 31, 2022, to allow sufficient time for responses within the fact discovery period.
2. Subpoenas to Third Parties. We recommend issuing subpoenas duces tecum to three third parties whose records are critical to assessing PBGC's financial condition and enforcement prospects:
Heartland Prairie Bank, N.A. (300 East Main Street, Decatur, IL 62521). We should subpoena the following from HPB: all loan agreements, promissory notes, security agreements, guarantees, and related documents evidencing the PBGC credit facility; all UCC financing statements and continuation statements filed with the Illinois Secretary of State; all correspondence regarding PBGC's default, including any default notices, demand letters, and forbearance agreements; all appraisals or valuations of PBGC's assets prepared for or at the request of HPB; and all communications between HPB (including Kenneth W. Aldrich) and PBGC regarding PBGC's financial condition and workout discussions. These records are directly relevant to assessing the extent of HPB's security interest, the value of its collateral, and whether any equity exists above HPB's secured claim that would be available to satisfy a GAP judgment.
Triton Mutual Insurance Co. (820 South Neil Street, Champaign, IL 61820). We should subpoena the following from Triton Mutual: the complete claim file for the Macon County elevator fire (claim date: October 17, 2021), including all claim submissions, adjusters' reports, damage assessments, and coverage analyses; the property insurance policy under which the claim was submitted; all correspondence between Triton Mutual and PBGC regarding the claim, including any coverage denial or reservation of rights letters; and all premium payment records for the 24 months preceding the fire. The key issue is whether Triton Mutual has denied coverage based on an alleged premium lapse. If coverage was denied, the fire loss reduces PBGC's asset base by approximately $3.2 million. If coverage is upheld and proceeds are paid, those proceeds may be subject to Heartland Prairie Bank's security interest (which typically covers insurance proceeds as part of the collateral package).
Mercer Tidwell & Associates PC (112 West Church Street, Champaign, IL 61820). We should subpoena PBGC's audited financial statements for FY 2020 and FY 2021, together with any management letters issued by the auditors. This subpoena serves as a backstop in the event PBGC fails to produce its audited financial statements in response to our direct document requests. Management letters may contain observations or warnings about PBGC's financial condition, internal controls, or going-concern issues that would be relevant to our enforcement analysis.
All three subpoenas should be issued pursuant to Illinois Supreme Court Rule 204 and served promptly. We will need to provide the required notice to PBGC and Musgrave's counsel under Rule 204(c) prior to service.
3. Depositions. We anticipate taking the following depositions during the fact discovery period:
Darren K. Musgrave — President, sole director, and 72% shareholder of PBGC, and the individual guarantor under the Musgrave Guaranty. Musgrave is the single most important witness in this litigation and his deposition should be comprehensive. Key topics include: his role in negotiating and executing the Off-Take Agreement; PBGC's decision to cease paying GAP; PBGC's financial condition, including the Heartland Prairie Bank default, the Macon County fire, and the hedging losses; the February 3, 2022 email acknowledging the debt and requesting forbearance; his understanding of and intent regarding the Personal Guaranty; any communications with Heartland Prairie Bank regarding the HPB default; the status of the Triton Mutual insurance claim; any transfers of PBGC assets or personal assets since January 1, 2021; and any alleged failure by GAP to mitigate its damages. This deposition will likely require a full day.
Lydia R. Musgrave — Secretary, Treasurer, and 18% shareholder of PBGC. Lydia Musgrave (Darren Musgrave's spouse, based on publicly available records) is the individual responsible for PBGC's financial records and accounting functions. Key topics include: PBGC's financial records and accounts payable procedures; PBGC's receipt and processing of GAP invoices; PBGC's payment history with GAP and other vendors; PBGC's current financial condition and liquidity; and any knowledge of the Off-Take Agreement and the circumstances of non-payment. This deposition will likely require a half day.
Victor P. Novotny — Vice President of Operations and 10% shareholder of PBGC. Novotny is responsible for PBGC's grain elevator operations, including the receipt, grading, weighing, and storage of grain at PBGC's facilities. Key topics include: the receipt and acceptance of GAP's grain shipments at PBGC's elevator facilities; the procedures for issuing scale tickets and receiving receipts; the October 17, 2021 Macon County elevator fire (cause, extent of damage, impact on operations); and PBGC's continued operations at its remaining five elevator facilities after the fire. Novotny's testimony will be particularly important in confirming delivery and acceptance of the grain underlying the five unpaid invoices. This deposition will likely require a half day.
Kenneth W. Aldrich (Heartland Prairie Bank, SVP Agribusiness Lending) — This deposition should be conducted only if needed and would require a subpoena under Illinois Supreme Court Rule 204. Aldrich is the senior HPB officer responsible for the PBGC lending relationship. Key topics would include: the terms and current status of the HPB credit facility; the nature and extent of HPB's security interest in PBGC's assets; the timeline of PBGC's default and HPB's enforcement actions; any appraisals of PBGC's assets; and HPB's assessment of PBGC's financial condition and ability to satisfy its obligations. We should evaluate the need for this deposition after reviewing the documents obtained through the HPB subpoena. If the documents are sufficiently informative, the deposition may be unnecessary.
Caleb Jennings (GAP, Director of Grain Operations) — While Jennings is our client's witness, we should prepare him for a deposition by defense counsel, which we anticipate will be noticed. Jennings is the individual at GAP who had primary responsibility for the GAP-PBGC relationship, including performance under the Off-Take Agreement, invoicing, the demand and forbearance timeline, and the decision to suspend deliveries on March 8, 2022. We should also prepare Jennings as a potential affiant for the summary judgment motion, as his testimony will be central to establishing GAP's performance and mitigation efforts. I recommend scheduling a preparation session with Jennings in early November 2022 to review the relevant documents and anticipated areas of examination.
Deposition scheduling should begin promptly. I recommend sending deposition notices for Darren Musgrave, Lydia Musgrave, and Victor Novotny by November 15, 2022, with target deposition dates in December 2022 or January 2023. This timeline allows sufficient time to review written discovery responses before conducting depositions, while leaving ample time for follow-up discovery and summary judgment preparation.
V. Defense Counsel Status and Implications
An important tactical consideration that warrants ongoing attention is the status of defense counsel. Bartlett, Reyes Linley CPAs LLP & Harkin LLP (Douglas M. Harkin, lead partner; Nadia C. Petrov, associate) is currently counsel of record for both PBGC and Musgrave as of the date of this memorandum. However, given the indications of PBGC's severe financial distress — including the Heartland Prairie Bank default, the disputed insurance claim, and the hedging losses — there is a meaningful risk that PBGC may be unable to continue paying its litigation counsel's fees.
Under Illinois law, a corporation cannot appear pro se and must be represented by a licensed attorney. See Holzrichter v. Yorath, 2013 IL App (1st) 110287. If Bartlett, Reyes Linley CPAs LLP & Harkin withdraws as counsel for PBGC and PBGC is unable to retain substitute counsel, PBGC would be effectively unable to participate in the litigation — unable to respond to discovery, appear at hearings, oppose motions, or defend at trial.
We should monitor the situation closely for any signs that a withdrawal may be forthcoming. Potential indicators include: delayed or incomplete discovery responses, requests for extensions of deadlines, missed court appearances, or a formal motion to withdraw. If defense counsel does withdraw and PBGC fails to retain substitute counsel within a reasonable time, we should consider the following courses of action:
(a) Accelerating the summary judgment timeline. If PBGC is unrepresented and unable to oppose a summary judgment motion, the motion would be unopposed, substantially increasing the likelihood of a favorable ruling.
(b) Seeking entry of default. If PBGC fails to appear by counsel at scheduled proceedings, we may seek entry of default pursuant to 735 ILCS 5/2-1301(d) for failure to appear or otherwise prosecute its defense. A default judgment on Counts I, III, and IV could be entered without the need for a dispositive motion.
(c) Separate treatment of Musgrave. Note that Musgrave, as an individual, may continue to appear pro se even if PBGC cannot. However, if Bartlett, Reyes Linley CPAs LLP & Harkin withdraws as to both defendants, Musgrave's pro se participation may be limited in scope and effectiveness.
We should not, of course, take any action to induce or accelerate counsel's withdrawal, but we should be prepared to act promptly if the situation develops. This is a matter I will continue to monitor and report on as developments warrant.
VI. Summary Judgment Preparation Timeline
The discovery plan is designed to build toward a motion for summary judgment that can be filed well in advance of the July 28, 2023 dispositive motions deadline. The following is a preliminary timeline for summary judgment preparation:
Phase 1: Receipt and Analysis of discovery Responses (October–November 2022). Following receipt of PBGC's responses to our First Set of Interrogatories and First Request for Production (due on or about October 28, 2022) and Requests for Admission (due November 11, 2022), we will analyze the responses for completeness, sufficiency, and substantive content. If responses are deficient, we will prepare and serve deficiency letters and, if necessary, file a motion to compel under Illinois Supreme Court Rule 219. If the Requests for Admission are not responded to by the November 11, 2022 deadline, they will be deemed admitted, and we should move promptly to capitalize on the deemed admissions.
Phase 2: Depositions and Third-Party discovery (December 2022–February 2023). We will conduct the depositions of Darren Musgrave, Lydia Musgrave, and Victor Novotny, and review documents obtained through third-party subpoenas. The deposition testimony will serve dual purposes: confirming the factual record for summary judgment and developing the financial condition/enforcement record.
Phase 3: Summary Judgment Drafting (February–April 2023). Following completion of key depositions and receipt of third-party subpoena responses, we will begin drafting the summary judgment motion, supporting memorandum of law, and Rule 191 statement of undisputed material facts. The motion will address Counts I, II, III, and IV, supported by the following evidence:
(a) The Off-Take Agreement and all relevant exhibits, including the Musgrave Guaranty (Exhibit D), authenticated through admissions or affidavit.
(b) The five unpaid invoices, authenticated through admissions or the Jennings affidavit.
(c) Delivery and acceptance records from GAP, including delivery tickets, scale tickets, and receiving receipts, authenticated through the Jennings affidavit.
(d) Demand correspondence: the January 25, 2022 Caleb Jennings demand letter and the April 11, 2022 Francesca Morano demand letter, authenticated through the Jennings affidavit and the Morano declaration, respectively.
(e) The February 3, 2022 Musgrave email acknowledging the debt and requesting forbearance, authenticated through production in discovery or through the Jennings affidavit as a business record received in the ordinary course.
(f) The interest calculation spreadsheet prepared by Patrick Gallagher and Diane K. Velasquez, showing accrued interest at 1.5% per month from each invoice due date through the anticipated date of judgment, authenticated through the Jennings affidavit or a separate supporting declaration.
(g) The affidavit of Caleb Jennings, Director of Grain Operations for GAP, attesting to GAP's performance under the Off-Take Agreement, the delivery and acceptance of grain, the invoicing and demand timeline, GAP's forbearance offer and PBGC's failure to make the required partial payment, GAP's suspension of deliveries on March 8, 2022 under Section 8.2, and GAP's mitigation efforts.
Addressing the Failure-to-Mitigate Defense. The summary judgment memorandum will include a section specifically addressing and seeking to dispose of the failure-to-mitigate defense. We will argue:
First, that the duty to mitigate is inapplicable to GAP's claim because GAP seeks recovery of the contract price for goods already delivered and accepted — not damages for lost profits on prospective future deliveries. Under UCC § 2-709 (action for the price) and Illinois case law, a seller who has delivered goods that have been accepted by the buyer is entitled to the contract price without any obligation to mitigate. The concept of mitigation applies where a plaintiff could have reduced its loss by, for example, covering or reselling undelivered goods. Here, the grain was delivered, accepted, and consumed or stored by PBGC, and there is nothing for GAP to resell or cover.
Second, that even if the duty to mitigate applies, GAP satisfied it. The undisputed record establishes that GAP demanded payment, offered forbearance conditioned on partial payment, and promptly suspended further deliveries when PBGC failed to make even the required partial payment. GAP acted within one week of the missed March 1, 2022 deadline to cut its losses. No reasonable juror could find that GAP failed to take reasonable steps to minimize its damages.
Third, that PBGC has failed to identify any specific action GAP could have taken to reduce its damages or any specific amount of damages that would have been avoided. Under Illinois law, the burden of proving failure to mitigate rests on the defendant, and a defendant that cannot identify specific mitigation opportunities and quantify the damages that would have been avoided cannot sustain this defense. See Siegel v. Levy Organization Development Co., 153 Ill.2d 534, 543 (1992).
Phase 4: Filing and Briefing (April–July 2023). We anticipate filing the motion for summary judgment in April or May 2023, well in advance of the July 28, 2023 deadline. This allows sufficient time for PBGC's response and GAP's reply under the applicable briefing schedule, and positions the motion for ruling before the September 15, 2023 pretrial conference.
If the Requests for Admission are deemed admitted due to PBGC's failure to respond by the November 11, 2022 deadline, we should consider accelerating this timeline significantly and filing the motion for summary judgment as early as December 2022 or January 2023.
VII. Budget and Staffing Considerations
The following staffing assignments and budget considerations apply to the discovery phase and summary judgment preparation:
Staffing.
Hannah Brinkley and Patrick Gallagher will handle the bulk of day-to-day discovery work, including reviewing and analyzing discovery responses, preparing follow-up discovery, drafting subpoenas, and preparing deposition outlines. Francesca Morano will provide strategic oversight, attend key depositions (primarily Darren Musgrave), interface with the client, and supervise the summary judgment briefing. Diane K. Velasquez and Ryan T. Marbury will manage document organization, assist with deposition preparation (including preparing exhibit binders), and handle logistical matters such as subpoena service, deposition scheduling, and court filings.
Estimated Additional discovery Costs. In addition to attorney and paralegal time, we anticipate the following hard costs:
• Deposition reporter fees: estimated $2,500–$4,000 per deposition (three to five depositions anticipated), for a total of approximately $7,500–$20,000.
• Subpoena service costs: estimated $200–$400 per subpoena (three subpoenas anticipated), for a total of approximately $600–$1,200.
• Expert fees: We do not anticipate retaining an expert on damages or interest calculation, as the claim is for a straightforward contract price with contractual interest, and the interest calculation can be presented through a lay witness (Caleb Jennings) or through counsel's summary exhibit. If PBGC retains a damages expert in connection with its mitigation defense, we may need to reconsider this assessment.
• Copying, messenger, and filing costs: estimated $500–$1,500.
Budget Discussion with Client. I recommend that we schedule a client update call or meeting with GAP (likely Caleb Jennings and GAP's in-house counsel, if any) to discuss the current status of the case, the discovery plan, the estimated budget for the discovery and summary judgment phases, and the enforcement outlook. We should provide GAP with a candid assessment of the recovery prospects given PBGC's financial distress and Heartland Prairie Bank's senior secured position. Total fees billed to date and projected additional fees through summary judgment should be reviewed at that time. GAP should also be consulted on its appetite for pursuing settlement versus full litigation, as the enforcement analysis may significantly affect this calculus.
VIII. Recommended Next Steps
Based on the foregoing analysis, I recommend the following action items, in approximate chronological order:
1. Monitor Response Deadlines. Calendar and monitor PBGC's deadlines to respond to the First Set of Interrogatories and First Request for Production (on or about October 28, 2022) and the Requests for Admission (November 11, 2022). Assign Diane K. Velasquez to confirm that all deadlines are properly calendared in the firm's docketing system and to send reminder alerts at 14 days and 7 days prior to each deadline.
2. Prepare Follow-Up discovery. Following receipt and review of PBGC's discovery responses, prepare deficiency letters identifying any incomplete, evasive, or otherwise insufficient responses. If deficiencies are not cured within a reasonable time (14 days), prepare and file a motion to compel under Illinois Supreme Court Rule 219, seeking an order compelling complete responses and, if warranted, sanctions for discovery abuse.
3. Prepare and Serve discovery to Musgrave. Prepare and serve Plaintiff's First Set of Interrogatories and First Request for Production of Documents directed to Darren K. Musgrave individually, focusing on personal financial condit

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