United States: Fox Rothschild Wins Rule 12 Dismissal For U.S. Bank
Last Updated: February 2 2017

A team of Fox Rothschild LLP litigators secured a significant victory for a banking client in a complex dispute involving more than $130 million in funding for a chemical manufacturing facility.

Christine N. Lindblad and Peter D. Stiteler of Fox's Minneapolis office won dismissal of all claims against their client, U.S. Bank, which was named as a third-party defendant in a lawsuit brought by Cargill and Cargill Financial Services International against HF Chlor-Alkali LLC (HFCA).

The case stemmed from a relationship that Cargill and HFCA formed to build a manufacturing facility in Iowa, financed partially through $80 million in bonds and $52 million in financing from CFSI.

U.S. Bank issued a letter of credit to secure the bonds that obligated HFCA to reimburse U.S. Bank for payments made under the letter of credit. U.S. Bank also entered a put agreement with Cargill obligating Cargill to purchase the rights and obligations of U.S. Bank under the reimbursement agreement should HFCA default on its obligations.

Ultimately, HFCA defaulted on its obligations, leading U.S. Bank to notice a default under the reimbursement agreement and, after paying off the bonds, assign its rights to Cargill. Cargill then filed suit against HFCA alleging breach of the reimbursement agreement, among other claims.

In response to the suit, HFCA brought counterclaims against Cargill alleging tortious interference with the reimbursement agreement between U.S. Bank and HFCA. The counterclaim was premised on the theory that HFCA was effectively prevented from making payments to U.S. Bank due to Cargill's failure to make payments to HFCA that it purportedly owed under various other contracts.

HFCA also claimed that U.S. Bank had aided and abetted and conspired with Cargill to interfere with its contract and had breached the duty of good faith and fair dealing.

The Fox team immediately moved for dismissal of all claims against U.S. Bank, arguing that none of HFCA's theories of liability were valid.

In a 16-page order, the U.S. District Court for the District of Minnesota dismissed all of HFCA's claims, holding that the tortious interference claim failed because it was solely based on Cargill's purported breach of contract, and thus the aiding and abetting and conspiracy claims must also fail. The court also concluded that U.S. Bank had not breached the duty of good faith and fair dealing, holding the language of the contract vindicated U.S. Bank.

Notably in regards to the good faith and fair dealing claim, the court concluded the claim must be dismissed because U.S. Bank had merely exercised its contractual rights after HFCA had already defaulted, reasoning a "party does not act in bad faith when it exercises its legal and contractual rights." Although HFCA argued that U.S. Bank had previously provided HFCA time to cure any past potential defaults, the court concluded that "U.S. Bank did not act in bad faith by declaring default even though it had previously chosen not to do so. The agreement specifically states that a delay in exercising rights does not waive those rights."

The court granted both Cargill's and U.S. Bank's motions to dismiss and dismissed the counterclaim and third-party complaint with prejudice.

For nearly 20 years, Lindblad, a partner at Fox, has adeptly represented banks, leasing companies and financial institutions in complex commercial litigation. She has extensive experience with insurance recovery lawsuits, receiver and foreclosure actions, fraudulent transfer litigation and vendor leasing disputes. A veteran trial attorney, she is particularly skilled at cross examination and has tried 15 cases to verdict. In addition, Lindblad regularly employs her effective communication skills and aggressive litigation techniques to prepare early, critical case evaluations to efficiently resolve disputes.

Stiteler, an associate with Fox, advises clients in a wide range of complex business and commercial disputes. He has successfully handled civil litigation cases in state and federal court involving professional negligence claims, construction disputes, employment litigation, product liability and insurance coverage. A former clerk for the Minnesota Court of Appeals, Stiteler has also worked on appeals to the Minnesota Court of Appeals and the U.S. Court of Appeals for the Eighth Circuit.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Press Releases from this Firm
Recent Content from this Firm
By GlobeSt .com
By National Real Estate Investor
By Melissa Lyon
By Jessica Diamond
By Mark Tabakman
By William Levinson
By Melissa Lyon
By Alexander Radus
By James Singer
By Carl Neff
Font Size:
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Check to state you have read and
agree to our Terms and Conditions

Terms & Conditions and Privacy Statement

Mondaq.com (the Website) is owned and managed by Mondaq Ltd and as a user you are granted a non-exclusive, revocable license to access the Website under its terms and conditions of use. Your use of the Website constitutes your agreement to the following terms and conditions of use. Mondaq Ltd may terminate your use of the Website if you are in breach of these terms and conditions or if Mondaq Ltd decides to terminate your license of use for whatever reason.

Use of www.mondaq.com

You may use the Website but are required to register as a user if you wish to read the full text of the content and articles available (the Content). You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these terms & conditions or with the prior written consent of Mondaq Ltd. You may not use electronic or other means to extract details or information about Mondaq.com’s content, users or contributors in order to offer them any services or products which compete directly or indirectly with Mondaq Ltd’s services and products.


Mondaq Ltd and/or its respective suppliers make no representations about the suitability of the information contained in the documents and related graphics published on this server for any purpose. All such documents and related graphics are provided "as is" without warranty of any kind. Mondaq Ltd and/or its respective suppliers hereby disclaim all warranties and conditions with regard to this information, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. In no event shall Mondaq Ltd and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use or performance of information available from this server.

The documents and related graphics published on this server could include technical inaccuracies or typographical errors. Changes are periodically added to the information herein. Mondaq Ltd and/or its respective suppliers may make improvements and/or changes in the product(s) and/or the program(s) described herein at any time.


Mondaq Ltd requires you to register and provide information that personally identifies you, including what sort of information you are interested in, for three primary purposes:

  • To allow you to personalize the Mondaq websites you are visiting.
  • To enable features such as password reminder, newsletter alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our information providers who provide information free for your use.

Mondaq (and its affiliate sites) do not sell or provide your details to third parties other than information providers. The reason we provide our information providers with this information is so that they can measure the response their articles are receiving and provide you with information about their products and services.

If you do not want us to provide your name and email address you may opt out by clicking here .

If you do not wish to receive any future announcements of products and services offered by Mondaq by clicking here .

Information Collection and Use

We require site users to register with Mondaq (and its affiliate sites) to view the free information on the site. We also collect information from our users at several different points on the websites: this is so that we can customise the sites according to individual usage, provide 'session-aware' functionality, and ensure that content is acquired and developed appropriately. This gives us an overall picture of our user profiles, which in turn shows to our Editorial Contributors the type of person they are reaching by posting articles on Mondaq (and its affiliate sites) – meaning more free content for registered users.

We are only able to provide the material on the Mondaq (and its affiliate sites) site free to site visitors because we can pass on information about the pages that users are viewing and the personal information users provide to us (e.g. email addresses) to reputable contributing firms such as law firms who author those pages. We do not sell or rent information to anyone else other than the authors of those pages, who may change from time to time. Should you wish us not to disclose your details to any of these parties, please tick the box above or tick the box marked "Opt out of Registration Information Disclosure" on the Your Profile page. We and our author organisations may only contact you via email or other means if you allow us to do so. Users can opt out of contact when they register on the site, or send an email to unsubscribe@mondaq.com with “no disclosure” in the subject heading

Mondaq News Alerts

In order to receive Mondaq News Alerts, users have to complete a separate registration form. This is a personalised service where users choose regions and topics of interest and we send it only to those users who have requested it. Users can stop receiving these Alerts by going to the Mondaq News Alerts page and deselecting all interest areas. In the same way users can amend their personal preferences to add or remove subject areas.


A cookie is a small text file written to a user’s hard drive that contains an identifying user number. The cookies do not contain any personal information about users. We use the cookie so users do not have to log in every time they use the service and the cookie will automatically expire if you do not visit the Mondaq website (or its affiliate sites) for 12 months. We also use the cookie to personalise a user's experience of the site (for example to show information specific to a user's region). As the Mondaq sites are fully personalised and cookies are essential to its core technology the site will function unpredictably with browsers that do not support cookies - or where cookies are disabled (in these circumstances we advise you to attempt to locate the information you require elsewhere on the web). However if you are concerned about the presence of a Mondaq cookie on your machine you can also choose to expire the cookie immediately (remove it) by selecting the 'Log Off' menu option as the last thing you do when you use the site.

Some of our business partners may use cookies on our site (for example, advertisers). However, we have no access to or control over these cookies and we are not aware of any at present that do so.

Log Files

We use IP addresses to analyse trends, administer the site, track movement, and gather broad demographic information for aggregate use. IP addresses are not linked to personally identifiable information.


This web site contains links to other sites. Please be aware that Mondaq (or its affiliate sites) are not responsible for the privacy practices of such other sites. We encourage our users to be aware when they leave our site and to read the privacy statements of these third party sites. This privacy statement applies solely to information collected by this Web site.

Surveys & Contests

From time-to-time our site requests information from users via surveys or contests. Participation in these surveys or contests is completely voluntary and the user therefore has a choice whether or not to disclose any information requested. Information requested may include contact information (such as name and delivery address), and demographic information (such as postcode, age level). Contact information will be used to notify the winners and award prizes. Survey information will be used for purposes of monitoring or improving the functionality of the site.


If a user elects to use our referral service for informing a friend about our site, we ask them for the friend’s name and email address. Mondaq stores this information and may contact the friend to invite them to register with Mondaq, but they will not be contacted more than once. The friend may contact Mondaq to request the removal of this information from our database.


This website takes every reasonable precaution to protect our users’ information. When users submit sensitive information via the website, your information is protected using firewalls and other security technology. If you have any questions about the security at our website, you can send an email to webmaster@mondaq.com.

Correcting/Updating Personal Information

If a user’s personally identifiable information changes (such as postcode), or if a user no longer desires our service, we will endeavour to provide a way to correct, update or remove that user’s personal data provided to us. This can usually be done at the “Your Profile” page or by sending an email to EditorialAdvisor@mondaq.com.

Notification of Changes

If we decide to change our Terms & Conditions or Privacy Policy, we will post those changes on our site so our users are always aware of what information we collect, how we use it, and under what circumstances, if any, we disclose it. If at any point we decide to use personally identifiable information in a manner different from that stated at the time it was collected, we will notify users by way of an email. Users will have a choice as to whether or not we use their information in this different manner. We will use information in accordance with the privacy policy under which the information was collected.

How to contact Mondaq

You can contact us with comments or queries at enquiries@mondaq.com.

If for some reason you believe Mondaq Ltd. has not adhered to these principles, please notify us by e-mail at problems@mondaq.com and we will use commercially reasonable efforts to determine and correct the problem promptly.