22 A 00128, 22 B 02890
Margaret Burke filed an adversary complaint against Leonard S. DeFranco, seeking a determination that a debt owed to her by DeFranco by virtue of a state court judgment was not dischargeable pursuant to §§ 523(a)(2)(A), (a)(4), and (a)(6). Subsequently, Burke filed a motion for partial summary judgment on the claims under § 523(a)(4) in Count II of her complaint. No material facts were in dispute. Burke argued that DeFranco was precluded from re-litigating the factual issues decided by the state court under the doctrine of collateral estoppel. DeFranco contended that collateral estoppel was not applicable because the state court findings did not establish any of the elements necessary for nondischargeability under § 523(a)(4). The Court found that the factual issues sought to be precluded precisely aligned with those that came before the state court for purposes of collateral estoppel and that the state court’s findings of fact, as well as DeFranco’s admissions, established, as a matter of law, all of the elements required for nondischargeability under § 523(a)(4). Accordingly, the Court granted Burke’s motion on Count II and entered judgment in her favor on that count.