21 B 11947, 22 A 8
Plaintiffs invested in a company for which Defendant was a managing member.  They have not received any return on their investment and brought a four count complaint seeking to except their claim from Defendant’s discharge.  HELD: Plaintiffs did not plead sufficient allegations to establish a plausible claim for relief under § 523(a)(2), although they will be allowed to amend the complaint to do so.  Among other issues, a document on which Plaintiffs allegedly relied was not provided to them by Defendant, and the complaint did not allege that the employee who did provide it was Defendant’s agent.  The complaint does state a claim under § 523(a)(4), but only with respect to actions taken after Plaintiffs had already invested in the company, and not for securities fraud.  Finally, the complaint does not state a claim for relief under § 523(a)(6).  Plaintiffs did not respond to Defendant’s argument that the § 523(a)(6) claim should be dismissed.