Madison County Associate Circuit Judge Clarence Harrison denied motions to dismiss in a case filed by owners of a railroad museum in California who allegedly lost hundreds of thousands of dollars after multiple entities conspired to deprive them of money they received in a lawsuit settlement.
Feather Rail Society sued Gateway Rail Services, Mid-America Rail Services, Illinois Transit Assembly Corp., Leslie M. Kasten, Mark Greve, Phillip Sheridan, John Giganti, Benjamin Butterworth, Roger V. Verbeeren Jr., Frank Dziama, Clyde Hentz and Robert Jackson in Madison County last year.
Harrison denied the Gateway and Mid-America groups on their motions to dismiss after their attorneys appeared in court.
The judge, however, did grant motions to dismiss for defendants Greve, Sheridan, Giganti, Butterworth, Verbeeren, Jr., Dziama, Hentz and Jackson.
The plaintiff was granted 30 days to re-file an amended complaint.
Feather River Rail claims it filed a lawsuit in 2000 against the Illinois Transit Assembly Corp. and Kasten, alleging breach of contract, conversion and fraud.
On June 19, 2003, Madison County Circuit Court entered a judgment in favor of Feather River Rail Society and ordered the ITAC and Kasten to pay $75,284 in compensatory damages and $750,000 in exemplary damages, according to court records.
ITAC and Kasten appealed the judgment multiple times, but lost every attempt, the suit states.
Since then, ITAC and Kasten have made several efforts to avoid paying the judgment, the complaint says.
For example, ITAC and Kasten transferred $1.625 million in property to Gateway on Sept. 25, 2007, after the judgment was entered in favor of Feather River Rail Society, the suit claims.
Following the transfer, Kasten received a home in Minneapolis valued at $400,000 and Gateway secured a $700,000 mortgage for the home, according to the complaint.
On July 11, 2008, ITAC was dissolved, yet it had not satisfied the judgment against it, the suit states.
"All defendants stood to gain financially if a judgment in favor of Feather River could not be collected from ITAC or Kasten," the complaint says.
Feather River Rail Society wants to see the court invalidate the ITAC's and Kasten's transfer of property to Gateway. In addition, it seeks compensatory damages of $241,334 interest at 9 percent per annum, punitive damages of $750,000, attorneys' fees and other relief.
Richard E. Boyle and Michael C. Hermann of Boyle Brasher in Belleville will be representing them.
Madison County Circuit Court case number: 11-L-919.