Ccp Golden / 7470 LLC v. Kevin Breslin

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 24-2731
CCP GOLDEN / 7470 LLC, et al.,
Plaintiffs-Appellees,
v.
K EVIN BRESLIN ,
Defendant-Appellant.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 1:21-cv-04081 — Sara L. Ellis, Judge.
____________________
A RGUED F EBRUARY 26, 2025 — DECIDED D ECEMBER 3, 2025
____________________
Before R OVNER , S CUDDER , and K OLAR , Circuit Judges.
K OLAR , Circuit Judge. In this contract dispute, Plaintiffs
leased four buildings to licensed skilled nursing facilities. De-
fendant Kevin Breslin and others guaranteed the nursing fa-
cilities’ obligations under the leases. When the tenants
breached their leases and a separate purchase-option agree-
ment, Plaintiffs sued Breslin and his co-guarantors under the
court’s diversity jurisdiction to enforce the guaranties. Later,
Plaintiffs discovered that one of the defendants’ presence in

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2 No. 24-2731
the suit destroyed complete diversity. They moved to dismiss
him to keep the case in federal court. The district court
granted the motion, which Breslin never contested. The par-
ties then proceeded to summary judgment, where Breslin pre-
sented no evidence. Plaintiffs prevailed, and the district court
awarded them nearly $22 million in damages.
Breslin appealed.1 He argues the district court improperly
dismissed his non-diverse former co-defendant—an indis-
pensable party, in his view—and that the case must thus be
dismissed for lack of subject matter jurisdiction. Alternatively,
Breslin seeks reversal of the district court’s grant of summary
judgment on damages. We find our jurisdiction secure and af-
firm in part on damages, but reverse the district court’s order
as to two narrow categories of damages and remand accord-
ingly.
I. Background
In reviewing the district court’s grant of summary judg-
ment to Plaintiffs, we construe all facts and draw all justifiable
inferences in the light most favorable to Breslin. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Plaintiffs are four
property-specific limited liability companies that each owned
real estate in Wisconsin. Breslin, through KBWB Operations,
LLC, operated four licensed skilled nursing facilities on Plain-
tiffs’ properties. Breslin’s relationship with Plaintiffs was gov-
erned by two guaranties of the leases applicable to the four
properties.
1 Breslin is the lone appellant; his co-defendants have been dismissed,
failed to appear, or had default judgments entered against them.

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No. 24-2731 3
A. Breslin’s Guaranties
In June 2003, one of the Plaintiffs entered a lease with a
tenant entity for its property in Chilton, Wisconsin. In August
2014, a limited liability company of which Breslin was a mem-
ber purchased that tenant’s equity. Plaintiffs consented to the
purchase on the condition that Breslin and his co-defendants
would jointly and severally guarantee the tenant’s obligations
under the lease. In December 2014, Breslin and his co-defend-
ants executed the requested guaranty in Plaintiffs’ favor (the
“Chilton Individual Guaranty”), which unconditionally guar-
anteed payment of all amounts and the performance of all
other obligations owed under the tenant’s lease.
In a similar arrangement, the other three Plaintiffs’ prop-
erties (in Appleton, Neenah, and Weston, Wisconsin) were
governed by a master lease executed by those Plaintiffs and
three property-specific tenant entities. In December 2015,
Breslin and his co-defendants executed a guaranty of that
lease in Plaintiffs’ favor (the “Master Lease Individual Guar-
anty”). As before, Breslin and his co-defendants uncondition-
ally guaranteed payment of all amounts and the performance
of all other obligations owed under the master lease. And
again, Breslin and his fellow guarantors were jointly and sev-
erally liable for performance of the guaranty.
B. Tenants’ Events of Default
Failure to make a minimum rent payment within five days
of the due date constituted a default under the governing
leases. The master-lease and Chilton tenants failed to pay rent
beginning in August 2018 and September 2018, respectively.
Thereafter, the tenants made no further payments and were
in default.

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4 No. 24-2731
In September 2018, an unrelated lender sued the tenants
in Wisconsin state court for defaulting on loan payments. In
response, the court appointed a receiver to operate the nurs-
ing facilities. The receiver relocated the facilities’ residents,
which caused the facilities to lose their licenses and operating
permits. Because the leases required the tenants to continu-
ously use and occupy the premises as skilled nursing facili-
ties, that amounted to a separate event of default.
Meanwhile, both leases had granted the tenants the option
to purchase the respective properties. In April 2017, before de-
faulting on the rent payments, the tenants had entered into an
agreement to exercise those options (the “Purchase Option
Exercise Agreement”). Under that agreement, the tenants
agreed to pay Plaintiffs liquidated damages upon default (i.e.,
their failure to close). The parties classified the liquidated
damages obligation as a monetary obligation of the tenants.
Liquidated damages would be calculated as the earnest
money deposit amounts provided for in the leases, less a
$105,278 reduction for the master lease. In connection with the
Purchase Option Exercise Agreement, Breslin and his co-
guarantors reaffirmed the Master Lease Individual Guaranty
and the Chilton Individual Guaranty, and they agreed to the
liquidated damages obligation.
After extending the closing date to March 2019, the tenants
failed to close on the purchase of the properties—an event of
default that triggered the liquidated damages obligation. In
December 2019, Plaintiffs sold the properties to an unrelated
buyer for $1 million.

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No. 24-2731 5
C. District Court Proceedings
In July 2021, Plaintiffs sued Breslin, Breslin’s limited liabil-
ity company KBWB Operations, LLC, and Breslin’s co-guar-
antors (all members of KBWB Operations) to enforce the Mas-
ter Lease Individual and Chilton Individual Guaranties.
Plaintiffs sought to recover millions of dollars in alleged
losses.
1. Diversity Jurisdiction
In their July 2021 complaint, Plaintiffs alleged that the de-
fendant-guarantors were each citizens of New York or New
Jersey. Plaintiffs themselves are Delaware limited liability
companies, each with the same Delaware-organized entity—
Sabra Health Care Limited Partnership—as its sole member.
Sabra’s general partner is Sabra Health Care REIT, Inc. (“Sa-
bra REIT”), a Maryland corporation with its principal place of
business in California; its limited partner is a Delaware lim-
ited liability company whose sole member is Sabra REIT. So,
Plaintiffs are deemed citizens of both Maryland and Califor-
nia for purposes of diversity jurisdiction. See Qin v. Deslong-
champs, 31 F.4th 576, 579 (7th Cir. 2022) (limited liability com-
panies and limited partnerships are deemed citizens of every
state in which their members or partners are citizens).
In January 2022, Plaintiffs moved to dismiss one of Bres-
lin’s co-guarantors, William G. Burris III, under Federal Rule
of Civil Procedure 21. When drafting the complaint, Plaintiffs
believed that Burris III resided with his father William G. Bur-
ris Jr. (another defendant) in New Jersey. But when serving
the complaint, they learned that Burris III was a California cit-
izen. Since Plaintiffs were also California citizens, Burris III’s
presence in the suit destroyed complete diversity. To preserve

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6 No. 24-2731
federal jurisdiction, Plaintiffs sought to dismiss Burris III.
They contended he was not a necessary and indispensable
party because the executed guaranties provided that each in-
dividual guarantor was jointly and severally responsible for
all obligations under the agreements. Breslin did not oppose
the motion. The district court granted the motion and dis-
missed Burris III, permitting the suit to remain in federal
court.
2. Liability and Damages
After discovery, Plaintiffs moved for summary judgment
on liability and damages. Plaintiffs sought nearly $22 million
in damages for unpaid rent, accelerated rent due through the
end of the leases, the premises’ lost value, real estate taxes,
late fees, utilities and maintenance costs, and liquidated dam-
ages under the Purchase Option Exercise Agreement.
Breslin did not specifically contest his liability for breach
of the guaranties. Rather, he opposed Plaintiffs’ motion for
summary judgment under Rule 56(d), arguing that he was un-
der criminal indictment and could not effectively defend him-
self without compromising his right against self-incrimina-
tion.2 He invoked his Fifth Amendment privilege in response
to the entirety of Plaintiffs’ Rule 56.1 statement. He otherwise
2 Breslin has since pled guilty to health care fraud and conspiracy to
commit an offense against the United States, violations of 18 U.S.C. §§ 1347
and 371, in connection with his operation of skilled nursing and assisted
living facilities. See United States v. Breslin, No. 3:23-cr-00010 (W.D. Wis.).
He was sentenced to 90 months’ imprisonment and three years’ super-
vised release, plus over $146 million in restitution and $8 million in forfei-
ture, and has appealed his sentence to this court.

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No. 24-2731 7
argued without evidence that Plaintiffs failed to fully mitigate
their damages.
The district court rejected Breslin’s Rule 56(d) request and
granted Plaintiffs’ motion for summary judgment. It awarded
Plaintiffs $21,941,829.35 in total damages: (1) $7,324,881.59 in
unpaid rent; (2) $10,305,302.24 in lost value of the premises;
(3) $340,811.85 in real estate and property taxes; (4)
$1,098,670.93 in liquidated damages for failure to close on the
purchase option; (5) $2,611,938.17 in late fees and interest; and
(6) $260,224.57 in utility and maintenance costs.
Breslin appealed. He argues the district court lacked juris-
diction because Burris III was a necessary and indispensable
party under Rule 19. On the merits, he does not dispute liabil-
ity but challenges the district court’s damages calculations.
II. Discussion
We start, as we must, with jurisdiction. Finding jurisdic-
tion secure, we then turn to the district court’s damages de-
termination.
A. Mandatory Joinder
We address Breslin’s mandatory joinder argument first, as
it implicates our jurisdiction.3 Page v. Democratic Nat'l Comm.,
3 Plaintiffs argue that Breslin waived his mandatory joinder argument
in failing to oppose their motion to voluntarily dismiss Burris III, meaning
that it was never presented to the district court. But if Burris III is a neces-
sary and indispensable party, the district court lacked subject matter juris-
diction, and jurisdictional issues of this nature generally may be presented
for the first time on appeal. Int’l Travelers Cheque Co. v. BankAmerica Corp.,
660 F.2d 215, 225 (7th Cir. 1981); cf. Republic of Philippines v. Pimentel, 553
U.S. 851, 861 (2008) (holding, in a case involving the failure to join an alleg-
edly indispensable party, that “[a] court with proper jurisdiction may also

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8 No. 24-2731
2 F.4th 630, 634 (7th Cir. 2021). Federal diversity jurisdiction
requires that no plaintiff be a citizen of the same state as any
defendant. Id. at 636; see 28 U.S.C. § 1332(a)(1). We ordinarily
assess this complete-diversity requirement as of the time the
complaint is filed. Perez v. Staples Contract & Com. LLC, 31
F.4th 560, 567 (7th Cir. 2022). But the district court may later
cure jurisdictional defects by dismissing nondiverse parties
“if their interests are severable and a decree without prejudice
to their rights may be made” should the action continue in
their absence. Grupo Dataflux v. Atlas Global Grp., L.P., 541 U.S.
567, 572 (2004) (citing Horn v. Lockhart, 84 U.S. 570, 579 (1873)).
There is no dispute that California citizen Burris III’s pres-
ence in the suit destroyed complete diversity. Whether the
district court rightly dismissed him under Rule 21 to preserve
subject matter jurisdiction turns on whether—as Breslin con-
tends—Burris III was indispensable under Rule 19.4 Thomas v.
United States, 189 F.3d 662, 667 (7th Cir. 1999). Rule 19’s pur-
pose is “to permit joinder of all materially interested parties
to a single lawsuit so as to protect interested parties and avoid
waste of judicial resources.” Davis Cos. v. Emerald Casino, Inc.,
268 F.3d 477, 481 (7th Cir. 2001) (internal quotation omitted).
If Burris III was indispensable, the parties may not litigate this
consider sua sponte the absence of a required person and dismiss for failure
to join”).
4 We have repeatedly left open whether joinder determinations under
Rule 19 are reviewed de novo or for abuse of discretion. See In re Veluchamy,
879 F.3d 808, 819 (7th Cir. 2018) (collecting cases). We do so again today,
as the result here would not differ under either standard. And Breslin does
not raise any factual disputes about Burris III’s citizenship that would be
subject to clear-error review. Id.

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No. 24-2731 9
controversy in his absence, and we must dismiss for lack of
subject matter jurisdiction.
The Rule 19 analysis has two steps: (1) whether Burris III
is a “necessary” party who “should be joined if feasible” un-
der Rule 19(a); and (2) if so, whether “there is no way to struc-
ture a judgment” in his absence “that will protect both [his]
own rights and the rights of the existing litigants,” making
him “indispensable” under Rule 19(b) and rendering the ac-
tion “subject to dismissal upon a proper motion[.]” Thomas,
189 F.3d at 667.
As an initial matter, we are doubtful Burris III would even
qualify as a necessary party under Rule 19(a), whether his
presence destroyed complete diversity or not. Since Burris III
was jointly and severally liable with his co-obligors, complete
relief could be granted to Plaintiffs in his absence. See Fed. R.
Civ. P. 19(a)(1)(A); Janney Montgomery Scott, Inc. v. Shepard
Niles, Inc., 11 F.3d 399, 406 (3d Cir. 1993). And disposing of the
action in Plaintiffs’ favor would not necessarily impair or im-
pede Burris III’s ability to protect his interest.5 See Fed. R. Civ.
P. 19(a)(1)(B)(i). As an absent party, he had no “full and fair
opportunity to litigate” the case, and we cannot see how he
would be bound by a judgment against Breslin as a matter of
5 Breslin does not contend that Burris III’s absence would create the
risk of “inconsistent obligations” under Rule 19(a)(1)(B)(ii); nor could he,
as the co-guarantors’ liability is joint and several. Pasco Int'l (London) Ltd.
v. Stenograph Corp., 637 F.2d 496, 503 (7th Cir. 1980).

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10 No. 24-2731
collateral estoppel.6 People v. Pawlaczyk, 189 Ill. 2d 177, 189
(2000); see Janney, 11 F.3d at 409–10.
Breslin argues otherwise based on the specific language of
the Guaranties, which make all co-guarantors “conclusively
bound” by any judgment in Plaintiffs’ favor regardless of
whether they were “entered as a party or participate[d] in
such Action.” But this language does not in and of itself carry
the force of a binding judgment; it would merely provide an
additional contractual remedy against Burris III in a separate
action, which he would have the opportunity to litigate. Cf.
Pasco Int'l (London) Ltd. v. Stenograph Corp., 637 F.2d 496, 503
(7th Cir. 1980) (analyzing the prejudicial effect of an “unfavor-
able judgment” under Rule 19).
We need not, however, definitively reach the question of
whether Burris III is a necessary party under Rule 19(a). For
even assuming he was, he would not be indispensable under
Rule 19(b). Rule 19(b) lists four factors to consider in deter-
mining indispensability: (1) the prejudice a judgment in the
person’s absence might cause; (2) the extent to which that
prejudice could be lessened through the relief awarded; (3)
the adequacy of such a judgment; and (4) whether the plaintiff
would have an adequate remedy if the case were dismissed
for nonjoinder. Fed. R. Civ. P. 19(b).
The Supreme Court has made clear that these factors do
not render jointly and severally liable co-guarantors indispen-
sable and that they may be dismissed to preserve jurisdiction.
Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826, 838 (1989)
6 A court would apply the law of the forum state—here, Illinois—to
determine the preclusive effect of the federal-court judgment in this diver-
sity case. See Taylor v. Sturgell, 553 U.S. 880, 891 n.4 (2008).

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No. 24-2731 11
(“[G]iven that all of the guarantors (including [the party to be
dismissed]) are jointly and severally liable, it cannot be ar-
gued that [that party] was indispensable to the suit.”); see also
Bio-Analytical Servs., Inc. v. Edgewater Hosp., Inc., 565 F.2d 450,
452–53 (7th Cir. 1977). Our sister circuits, too, have held that
co-obligors under a contract “are not indispensable parties in
contract disputes that do not … challenge the validity of the
contract” as a whole, which no party does here. In re Olympic
Mills Corp., 477 F.3d 1, 10 (1st Cir. 2007) (collecting cases).
A contrary rule would render contractual joint and several
liability largely irrelevant. Where parties have agreed to share
responsibilities for damages, “[a] victim of wrongdoing is not
generally required to sue all the wrongdoers” to obtain relief,
in contract as in tort. Rhone-Poulenc Inc. v. Int'l Ins. Co., 71 F.3d
1299, 1301 (7th Cir. 1995); see also 7 Charles A. Wright et al.,
Federal Practice and Procedure § 1613 (3d ed. Sept. 2025 update)
(“Today the joinder of obligors is left to plaintiff’s discretion
by many courts and plaintiff may select defendants without
being concerned about dismissal because of nonjoinder.”).
And whatever hypothetical prejudice Burris III might suffer
from a future action against him, “the prospect of later litiga-
tion … is not sufficiently significant to make [him] an indis-
pensable party” under these circumstances. Pasco, 637 F.2d at
505. Rather, we should be “reluctant to dismiss for failure to
join where doing so deprives the plaintiff of his choice of fed-
eral forum.” Askew v. Sheriff of Cook County, 568 F.3d 632, 634
(7th Cir. 2009) (citing Davis Cos., 268 F.3d at 481).
Breslin advocates for a bright-line rule that parties to a
contract are indispensable to suits on the contract. True, we
observed in Davis Companies that “a contracting party is the
paradigm of an indispensable party.” 268 F.3d at 484. But

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12 No. 24-2731
Breslin’s maximalist reading of one line from Davis Compa-
nies—which he reads to imply that all contracting parties are
by definition necessary and indispensable—is unfounded in
our precedent, which calls for a case-specific inquiry. Provi-
dent Tradesmens Bank & Tr. Co. v. Patterson, 390 U.S. 102, 118
(1968) (under Rule 19, “[w]hether a person is ‘indispensable’
… can only be determined in the context of particular litiga-
tion”); Bio–Analytical, 565 F.2d at 452 (“Generally, Rule 19 en-
tails a pragmatic approach, focusing on realistic analysis of
the facts of each case.”); see also Est. of Plott v. Dep't of Health &
Hum. Servs., 151 F.4th 848, 854 (6th Cir. 2025) (“Because dis-
trict courts must conduct a Rule 19 analysis on a case-by-case
basis, a party to a contract is not per se necessary and indis-
pensable to litigation involving that contract.”).
Moreover, that sweeping statement from Davis Companies
was dicta since the party at issue in that case was not a con-
tracting party. 268 F.3d at 484. And it was quoted from a dif-
ferent case even further afield from the facts here, considering
the total rescission of the contracts at issue. See United States
ex rel. Hall v. Tribal Dev. Corp., 100 F.3d 476, 479 (7th Cir. 1996)
(deciding whether a tribe was indispensable to a qui tam suit
seeking to void contracts between the tribe and gaming-re-
lated vendors under federal statutes). It thus has little rele-
vance to this action, in which Plaintiffs seek not to set aside
the Guaranties but to enforce them. And of course, Davis Com-
panies must also be read against our earlier and more specific
holdings—and the Supreme Court’s in Newman-Green—that
joint and severally liable guarantors are not indispensable un-
der Rule 19(b). Bio-Analytical, 565 F.2d at 453; Newman-Green,
490 U.S. at 838.

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No. 24-2731 13
Because Burris III was not indispensable to the litigation,
the district court did not err in dismissing him to maintain di-
versity jurisdiction over the suit. With jurisdiction secure, we
turn to Breslin’s appeal of the district court’s judgment as to
damages.
B. Damages
Although Breslin does not contest liability on appeal, he
argues that the district court’s damages award was erroneous.
In his view, Plaintiffs failed to mitigate their losses, and their
requested damages were improper, speculative, and punitive.
We note at the outset that Breslin did not put up much of a
fight on damages before the district court. He did not dispute
Plaintiffs’ facts about damages in his responses to their Rule
56.1 statement, instead refusing to answer based on his Fifth
Amendment privilege. He did not offer any alternative dam-
ages calculations. Nor did he provide any contrary evidence.
Goodman v. Nat'l Sec. Agency, Inc., 621 F.3d 651, 654 (7th Cir.
2010) (summary judgment is the “‘put up or shut up’ moment
in litigation” in which “the non-moving party is required to
marshal and present the court with the evidence []he con-
tends will prove h[is] case”).
That alone does not resolve this appeal, though: we must
still confirm that Plaintiffs’ evidence entitles them to judg-
ment as a matter of law. LaSalle Bank Lake View v. Seguban, 54
F.3d 387, 391–92 (7th Cir. 1995). In doing so, we review sum-
mary judgment issues and the damage-computation method-
ology de novo but review the award amount only for clear er-
ror. Rexam Beverage Can Co. v. Bolger, 620 F.3d 718, 727 (7th Cir.
2010).

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14 No. 24-2731
In this diversity suit, we apply the damages rules of Illi-
nois—the state whose law governs the substantive issues in
the case. See Arpin v. United States, 521 F.3d 769, 776 (7th Cir.
2008). Under Illinois law, “[t]he party seeking damages must
prove its damages to a reasonable degree of certainty, and ac-
cordingly the evidence it presents must not be remote, specu-
lative, or uncertain.” Doornbos Heating & Air Conditioning, Inc.
v. Schlenker, 403 Ill. App. 3d 468, 485 (1st Dist. 2010). Damages
determinations do not require absolute certainty; “all that the
law requires is that there be an adequate basis in the record
for the court’s determination.” First Nat. Bank & Tr. Co. of Ev-
anston v. J.P. Schermerhorn & Co., 192 Ill. App. 3d 1057, 1062
(1st Dist. 1989).
We conclude that there is an adequate basis in the record
supporting Plaintiffs’ mitigation efforts and diminution-in-
value damages. But we must vacate the district court’s deter-
mination of Plaintiffs’ accelerated-rent damages under the
leases and their liquidated damages under the Purchase Op-
tion Exercise Agreement, as discussed below. We note, in do-
ing so, that the district court faced a challenging and unique
set of questions and tackled these with little help from Breslin.
1. Failure to Mitigate
Under Illinois law, “[a] party being damaged cannot stand
idly by and allow the injury to continue and increase without
making reasonable efforts to avoid further loss.” Nancy's
Home of the Stuffed Pizza, Inc. v. Cirrincione, 144 Ill. App. 3d 934,
941 (1st Dist. 1986).7 To support their mitigation efforts,
7 The Guaranties each include a waiver-of-defenses clause that might
be construed to waive Breslin’s failure-to-mitigate defense. See WEC 98C-
3 LLC v. SFA Holdings Inc., 99 F.4th 961, 969 (7th Cir.) (construing the plain

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No. 24-2731 15
Plaintiffs submitted a sworn declaration from their parent
company’s Executive Vice President of Asset Management
and a deal tracker spreadsheet outlining their attempts to sell
the properties.8 These submissions—unrebutted by Breslin—
show that Plaintiffs made reasonable efforts to mitigate their
damages.
The declaration and deal tracker detail how, in October
2018, Plaintiffs engaged a marketing agent and broker to as-
sist them in reletting or selling the properties occupied by the
nursing facilities. They establish that from October 2018 to
March 2019, Plaintiffs’ agent prepared an offering memoran-
dum, worked on underwriting, marketed the facilities to over
a hundred prospects, and (after those efforts proved unsuc-
cessful) identified a local real estate agent to market the prop-
erties. After the nursing facilities lost their licenses, Plaintiffs
accepted the best available offer. These measures provide am-
ple support for the district court’s finding that Plaintiffs miti-
gated their damages.
language of a guaranty and finding that a party waived the right to assert
any defenses), cert. denied sub nom. SFA Holdings, Inc. v. 4 Stratford Square
Mall Holdings, LLC, 145 S. Ct. 287 (2024); Takiff Props. Grp. Ltd. #2 v. GTI
Life, Inc., 2018 IL App (1st) 171477, ¶¶ 25–29 (enforcing a contractual pro-
vision waiving a statutory defense). But Plaintiffs never made this argu-
ment before the district court, and given the evidence of mitigation, we
see no reason to resolve this issue.
8 While “a party’s affidavit can serve as a vehicle for introducing facts
at summary judgment, the party cannot rest upon conclusory statements
in affidavits; [it] must go beyond the pleadings and support [its] conten-
tions with proper documentary evidence.” FTC v. Day Pacer LLC, 125 F.4th
791, 802–03 (7th Cir. 2025) (internal citation and quotation omitted). Here
there is no issue: Plaintiffs’ deal tracker supports the declaration.

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16 No. 24-2731
2. Diminution in Value
The district court awarded $10,305,302.24 for diminution
in value, and we find no error in either its methodology or
computation. “Damages for breach of contract are intended to
place the nonbreaching party in the same position as if the
contract had been performed.” Union Tank Car Co. v. NuDevco
Partners Holdings, LLC, 2019 IL App (1st) 172858, ¶ 44. Here,
the leases required the tenants to maintain the properties in
good condition and continue to operate them as nursing facil-
ities. But as a result of their breach, the value of Plaintiffs’
properties was foreseeably diminished by the nursing facili-
ties’ loss of their operating licenses after being placed into re-
ceivership. Plaintiffs were thus entitled to seek damages plac-
ing them in the financial position they would have attained at
the conclusion of the lease terms but for those events of de-
fault. Midland Hotel Corp. v. Reuben H. Donnelley Corp., 118 Ill.
2d 306, 318 (1987) (“[A]ll damages which naturally and gen-
erally result from a breach are recoverable[.]”).
Breslin avers that Plaintiffs failed to prove their damages
to a reasonable degree of certainty. We disagree. To determine
the diminution in value, the district court relied on Plaintiffs’
calculation of the annual amount for which the properties
could be leased by operators of skilled nursing facilities, di-
vided by a 9.5% capitalization rate. The district court then ap-
plied an 8% discount rate to that figure to determine the net
present value of the premises, subtracted the $1 million Plain-
tiffs received when the properties sold, and added in the costs
they were forced to pay in connection with the sale to arrive
at the $10,305,302.24 diminution-in-value amount.
Breslin does not dispute that Plaintiffs are entitled to their
expectation damages, nor does he challenge the various rates

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No. 24-2731 17
used in their damages calculation. And he failed to offer any
evidence undermining the district court’s determination of
Plaintiffs’ damages. Absent any contrary evidence that this
award is improper, we affirm. Hanover Ins. Co. v. N. Building
Co., 751 F.3d 788, 795 (7th Cir. 2014).
3. Accelerated Rent
The district court awarded $7,324,881.59 in unpaid rent
under the Guaranties: $1,528,614.55 in unpaid rent through
December 2019 (when Plaintiffs sold the nursing facilities)
and $5,796,267.04 in accelerated rent through January 2026
(the anticipated lease term). Breslin now argues that the accel-
erated-rent portion of this award operates as an impermissi-
ble penalty.
Illinois does not recognize a common-law right to future
rent in the event of a breach, unless the parties have agreed as
much through a rent-acceleration clause. Union Tank, 2019 IL
App (1st) 172858, ¶ 44. Where these clauses appear—as they
do in both leases at issue in this case—they are usually treated
as a form of liquidated damages. See, e.g., 2460-68 Clark, LLC
v. Chopo Chicken, LLC, 2022 IL App (1st) 210119, ¶¶ 29, 33;
Slyce Coal Fired Pizza Co. v. Metro. Square Plaza, LLC, 2025 IL
App (1st) 221279, ¶ 184; see also Baird & Warner Residential
Sales, Inc. v. RXHST Naperville, LLC, 2025 WL 2044017, at *4
(N.D. Ill. July 21, 2025) (applying Illinois law).9 Under Illinois
9 We note that both Slyce Coal Fired Pizza Co. and Baird & Warner Resi-
dential Sales were decided after the district court issued its decision below,
as well as the close of briefing and argument in this appeal. Neither party
submitted a notice of supplemental authority under Federal Rule of Ap-
pellate Procedure 28(j) on these cases; in any event, they are persuasive
but not controlling as to our ultimate decision here.

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18 No. 24-2731
law, liquidated-damages clauses are only valid where “(1) the
parties intended to agree in advance to the settlement of dam-
ages that might arise from the breach; (2) the amount of liqui-
dated damages was reasonable at the time of contracting,
bearing some relation to the damages that might occur; and
(3) actual damages would be uncertain in amount and diffi-
cult to prove.” Smart Oil, LLC v. DW Mazel, LLC, 970 F.3d 856,
863 (7th Cir. 2020) (citing Karimi v. 401 N. Wabash Venture, 2011
IL App (1st) 102670, ¶ 16).
We do not question that some amount of damages to com-
pensate Plaintiffs for forgone rent is appropriate. As discussed
above, Plaintiffs should be placed in the position they would
have been had there been no breach. The diminution-of-value
award does not account for the additional lost rent over the
lease term; but for the breach, Plaintiffs could have rented the
properties through January 2026 and subsequently sold them
for a higher value. Plaintiffs also applied an 8% discount to
their accelerated rent calculation to reduce it to present value,
and Breslin offers nothing to suggest this method is inappro-
priate.
Rather, Breslin contends that accelerated-rent clauses
must also offset the fair rental value of the premises to avoid
giving Plaintiffs a double recovery by collecting both acceler-
ated rent and a new tenant’s rent. See Slyce Coal Fired Pizza,
2025 IL App (1st) 221279, ¶ 185 (citing 2336 North Clark, LLC
v. Hair Fairies, Inc., 2022 IL App (1st) 211597-U). Plaintiffs re-
tort that there was, in fact, no such double recovery here: they
were unable to relet the properties and ultimately sold them
at a substantial loss well before the end of the lease term. But
under Illinois law, whether a contractual damages term oper-
ates as a penalty turns on the reasonableness of the term “at

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No. 24-2731 19
the time of contracting,” not after the fact. Karimi, 2011 IL App
(1st) 102670, ¶ 24.
Here, one of the two leases—the master lease—accounted
for a potential offset, discounting any accelerated rent by “any
net amounts that Landlord has received that mitigate Land-
lord’s damages.” This clause was enforceable: it reflected the
parties’ intent, appropriately predicted Plaintiffs’ likely dam-
ages at the time of contracting, and accounted for the likeli-
hood that Plaintiffs’ actual damages “from lost future rent in
the event [the tenants] breached the lease … would be uncer-
tain and difficult to prove.” Slyce Coal Fired Pizza Co., 2025 IL
App (1st) 221279, ¶ 179.
But the other lease—the Chilton lease—had no such offset
provision, providing only that “Landlord … [may] collect …
the acceleration of all minimum rent which would have ac-
crued after [the lease’s] termination” upon any “Event of De-
fault[.]” It is not clear, therefore, that this term reasonably an-
ticipated the applicable Plaintiff’s potential damages at the
time of contracting.
Recently, Illinois courts appear to have reached conflicting
results on whether accelerated-rent clauses must include this
offset language to be enforceable as a matter of law. Compare
Slyce Coal Fired Pizza, 2025 IL App (1st) 221279, ¶ 185 (“[A]
provision … that demands payment of all remaining rent for
the remainder of the lease term, without accounting for the
landlord’s ability to relet the premises … is a penalty.”), with
Chopo Chicken, 2022 IL App (1st) 210119, ¶¶ 29, 33 (finding ac-
celerated-rent clause without any offset language enforcea-
ble).

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20 No. 24-2731
Here, however, there is simply no evidence suggesting
that the parties reasonably contemplated Plaintiffs might be
unable to relet the Chilton premises for the entire remaining
lease term as a result of any breach, however minor, when en-
tering into their agreement. See GK Dev., Inc. v. Iowa Malls Fin.
Corp., 2013 IL App (1st) 112802, ¶ 54 (liquidated-damages
clause for “entire, present-day value of 20-year lease” was not
“reasonable prediction of damages” from delay in obtaining
permits); Hair Fairies, 2022 IL App (1st) 211597-U, ¶ 31; cf.
Penske Truck Leasing Co., L.P. v. Chemetco, Inc., 311 Ill. App. 3d
447, 455–56 (5th Dist. 2000) (finding liquidated-damages
clause enforceable after concluding that damages formula
reasonably approximated actual costs of breach).
Absent such evidence, we must vacate the portion of the
accelerated-rent damages award attributable to the Chilton
lease and remand to the district court for further considera-
tion of whether that lease’s accelerated-rent clause was a rea-
sonable prediction of Plaintiffs’ damages at the time of con-
tracting or an unenforceable penalty. While we are unsure
what further evidence or argument the parties might submit,
we leave it to the district court’s discretion whether to hold
additional proceedings on this issue or simply recalculate the
final damages figure with the Chilton lease’s accelerated rent
excluded.
4. Liquidated Damages for Breach of Purchase Option
Finally, the district court awarded Plaintiffs $1,098,670.93
in liquidated damages arising from the tenants’ breach of the
Purchase Option Exercise Agreement for the facilities. Again,
liquidated damages are valid if the parties agreed to them in
advance, they reasonably forecast the anticipated costs of
breach, and actual damages would be “uncertain in amount

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No. 24-2731 21
and difficult to prove.” Smart Oil, 970 F.3d at 863 (citing
Karimi, 2011 IL App (1st) 102670, ¶ 16). A clause that is unable
to pass this test is an unenforceable penalty. Id.
Liquidated damages for breach of a real estate purchase
agreement are meant to serve as a substitute, not a supple-
ment, to actual damages arising from the same breach.10 Mor-
ris v. Flores, 174 Ill. App. 3d 504, 506 (2d Dist. 1988) (“It would
be inconsistent to provide in the contract for liquidated dam-
ages and also allow a party to pursue other remedies for
money damages.”). And as discussed above, several of Plain-
tiffs’ other categories of compensatory damages—in particu-
lar, Plaintiffs’ diminution-in-value damages from selling the
premises at a loss—are far from uncertain and (as this litiga-
tion has shown) relatively easy to prove. Since “a determina-
tion of actual damages in the event of breach of contract
would not [have been] difficult” at the time of contracting,
and such a determination was in fact made here, we find the
purchase-option liquidated-damages clause unenforceable as
a matter of law. Hickox v. Bell, 195 Ill. App. 3d 976, 988 (5th
Dist. 1990). Thus, we reverse the district court’s liquidated-
damages award arising from the Purchase Option Exercise
Agreement.
III. Conclusion
For the reasons discussed herein, we VACATE the district
court’s award of $7,324,881.59 in unpaid minimum rent and
$1,098,670.93 in liquidated damages, and REMAND for pro-
ceedings consistent with this order. We stress that the scope
of this remand is narrow and limited solely to (1) revisiting
10 Plaintiffs’ counsel, to his credit, largely agreed with that assessment
at oral argument. Oral Argument at 24:57–25:10.

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22 No. 24-2731
the component of the accelerated-rent damages attributable to
the Chilton lease, and (2) eliminating the liquidated damages
from the Purchase Option Exercise Agreement. In all other as-
pects, the district court’s judgment is AFFIRMED.

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