Pengobo Fu v. Yongxiao Fu

2017 Ill. App 162958 (2017)

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Pengobo Fu v. Yongxiao Fu

Illinois Appellate Court
2017 Ill. App 162958 (2017)

Facts

Pengobo Fu (plaintiff), a citizen of the People’s Republic of China (PRC), gave his son, Yongxiao Fu (defendant), also a citizen of the PRC, a gift of $590,000. Under the gift agreement, which was written in Chinese and contained a choice-of-law clause selecting PRC law, Pengobo’s gift was free and unconditional, but the gift’s intended purpose was for Yongxiao to obtain an EB-5 visa. To obtain an EB-5 visa, an alien had to invest $500,000 in certain businesses. Yongxiao twice attempted to invest $500,000 in projects in the Chicago area. As part of his second attempt to invest, Yongxiao transferred the funds to the Lake 1 LLC EB-5 Escrow Account at the International Bank of Chicago. After the United States denied approval for the second project, Yongxiao signed an agreement for another investment in a project in New York. However, a few weeks later, Pengobo’s attorneys wrote to the International Bank of Chicago to inform the bank that the funds were under dispute. Pengobo then filed suit in a court in the PRC, seeking to revoke the gift. The PRC court entered an order freezing the funds in the escrow account. Pengobo then filed suit in Illinois state court seeking the return of the funds, claiming that under PRC law, Pengobo had never relinquished control over the money, Yongxiao had failed to meet the requirements of the gift agreement by not obtaining an EB-5 visa, and Yongxiao was not supporting his parents, refused to talk to them, and was inconsiderate toward them. Pengobo further argued that PRC law permitted a party to revoke a gift agreement if the donee failed to fulfill an obligation to provide for the donor, and that Yongxiao had violated the PRC Marriage Law by not supporting his parents. In support of his claims, Pengobo merely attached translations of two PRC cases that were not directly relevant, and he did not explain how the cases supported his claims. Yongxiao filed a motion to dismiss, arguing that Pengobo’s complaint failed to adequately plead PRC law and failed to state a claim under Illinois law, and that Yongxiao was meeting the terms of the agreement. The trial court granted Yongxiao’s motion to dismiss, holding that Pengobo had failed to provide any evidence to support his interpretation of PRC law and that his complaint did not state a claim under Illinois law.

Rule of Law

Issue

Holding and Reasoning (Howse, J.)

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