[UPDATED THROUGH September 12, 2016]
Illinois Supreme Court Civil Issues Pending: Civil Procedure
[UPDATED THROUGH September 6, 2016]
J & J Ventures Gaming, LLC v. Wild, Inc.
Supreme Court Case Number: 119870
Appellate Court: Fifth District
Appellate Court Case Number: 5-14-0092
Issues Presented: (1) Is the dispute between the plaintiff, defendant and intervenor regarding whether or not the plaintiff has a valid “written use agreement” within the meaning of the Video Gaming Act within the exclusive jurisdiction of the Gaming Board? (2) If not, does the plaintiff have a valid “written use agreement” granting the right to place video gaming terminals in the defendant’s establishment even though the agreement was created and assigned to the plaintiff by two entities which were never licensed to operate video gaming terminals under the Act?
Summary of Facts and Lower Court Holdings: Following enactment of the Video Gaming Act and before the Gaming Board established rules for implementing the Act, certain unlicensed persons and entities entered into agreements with establishments hoping to become licensed establishments under the Act. These agreements purported to grant the unlicensed entity the right to place video gaming terminals in the establishment once both sides became licensed entities under the Act. The defendant entered into such an agreement. The initial entity which signed the contract with the defendant never became a licensed entity. Instead, it assigned its rights under the contract to another entity which did intend to become licensed. Pursuant to the contract, the assigning entity was entitled to additional compensation once the video gaming terminals were installed and operating. The assignee was subsequently denied a license under the Act. It then entered into an asset purchase agreement with the plaintiff, including sale of its rights under the contract. That asset purchase agreement provided that the assigning party would also receive additional compensation once the video gaming terminals were operating. The plaintiff filed a declaratory judgment action, seeking a declaration that it had the exclusive right to place video gaming terminals in the defendant’s establishment. The Circuit Court granted the judgment, relying upon Triple 7 Illinois, LLC v. Gaming & Entertainment Management-Illinois, 2013 IL App (3d) 120860. The Appellate Court reversed, holding that whether or not the parties’ assignment was valid and enforceable was a matter within the exclusive jurisdiction of the Gaming Board.
Illinois Supreme Court Civil Issues Pending: Arbitration
[UPDATED THROUGH September 6, 2016]
Illinois Supreme Court Civil Issues Pending: Insurance
[UPDATED THROUGH September 12, 2016]
Illinois Supreme Court Civil Issues Pending: Government Law
[UPDATED THROUGH September 12, 2016]
Stone Street Partners, LLC v. City of Chicago Department of Administrative Hearings
Supreme Court Case Number: 117720
Appellate Court: First District, Division One
Appellate Court Case Number: 123645
Issue Presented: What is the proper remedy where an administrative notice of building code violations was served upon the property itself, not the business address or registered agent of the owner of the property?
Summary of Facts and Lower Court Holdings
Beggs v. Board of Education of Murphysboro Community Unit School District No. 186
Supreme Court Case Number: 120236
Appellate Court: Fifth District
Appellate Court Case Number: 150018
Issue Presented: How deferential is the standard of review govering downstate boards of education reviewing the decisions of hearing officers in connection with disciplinary proceedings for teachers?
Summary of Facts and Lower Court Holdings
Grimm v. Calica
Supreme Court Case Number: 120105
Appellate Court: Second District
Appellate Court Case Number: 2-14-0820
Issue Presented: Is the date on a business letter sufficient notice of service of an administrative decision to start the clock ticking on the deadline for filing a petition for administrative review?
Summary of Facts and Lower Court Holdings
Village of Bartonville v. Lopez
Supreme Court Case Number: 120643
Appellate Court: Third District
Appellate Court Case Number: 3-15-0341
Issue Presented: Are all disciplinary actions against public employees, up to and including termination, subject to a rebuttable presumption of arbitrability absent an express carve-out in the parties’ collective bargaining agreement?
Summary of Facts and Lower Court Holdings
The Hertz Corporation v. City of Chicago
Supreme Court Case Number: 119945
Appellate Court: First District, Second Division
Appellate Court Case Number: 1-12-3210
Issue Presented: Is the extension of the City of Chicago’s use tax on leased personal property to all rental car transactions occurring within three miles of the city’s border facially unconstitutional?
Summary of Facts and Lower Court Holdings: The Chicago Municipal Code imposes an 8% use tax on the rental of personal property within the city, or the use of personal property within the city that is rented outside the city. The Department of Revenue issued a second amended ruling, pursuant to authority granted in the applicable ordinance, explaining the application of the tax to car rental locations within three miles of the City’s border, where the locations are owned by companies which also do business in the city. The ruling states that the Department will not audit rental locations more than three miles from the city border (except for O’Hare field). The Department assumes that vehicles rented by drivers with city addresses on their licenses will be used more than 50% of the time in the city, and are thus subject to the tax. Where the driver’s license does not bear an in-city address, there is a rebuttable presumption that the use of the vehicle is not taxable. The ruling further provides that lessors may obtain a check-box response from lessees stating whether or not the vehicle will be used more than 50% of the time inside the city, the Department will accept the statement as sufficient proof of use. The plaintiffs sought declaratory and injunctive relief to stop enforcement of the ordinance, arguing that (1) the amended ruling was an extraterritorial exercise of Chicago’s home rule authority; (2) the ruling was beyond the scope of the ordinance; and (3) the ruling violates the due process and commerce clauses. The trial court granted summary judgment in favor of the plaintiffs, holding the ordinance and ruling unconstitutional. The Appellate Court reversed. As for the notion that the tax was extraterritorial, the Court held that the tax was on the use of the vehicle, not on the rental transaction which took place outside of the city limits. Since the ruling was limited to car rental companies which did business within the city, the city was permitted to task those companies with the duty to collect the tax, where applicable. The Court rejected the plaintiffs’ due process and commerce clause challenges on the grounds that the tax was levied on the use of the vehicles in the city, not on the rental transactions.
Bueker v. Madison County, Illinois
Supreme Court Case Number: 120024
Appellate Court: Fifth District
Appellate Court Case Number: 5-14-0473
Issue Presented: Did the plaintiffs, individuals allegedly injured by the official misconduct of the former treasurer and collector of Madison County, have standing to directly sue the issuer of the former treasurer’s public official bond?
Summary of Facts and Lower Court Holdings: The plaintiffs filed a multi-count complaint, seeking redress for injuries they allegedly suffered from the official misconduct of the former treasurer and collector of Madison County. Count VII of the plaintiffs’ complaint was brought directly against the issue of the former treasurer’s public official bond. The trial court granted a motion to dismiss with respect to Count VII, holding that the plaintiffs lacked standing to sue directly on the bond. The Appellate Court affirmed. The Court noted that the statutes requiring both the treasurer’s and collector’s bonds require that the bonds be drawn in the name of “the People of the State of Illinois.” However, the former treasurer’s bond was actually drawn in the name of “Madison County Government.” The Court held that although public official bonds are drawn to protect the interests of those injured by official misconduct, standing to sue must be found in the express language of the bond or the authorizing statute. The Court held that the statutory reference to “the People of the State of Illinois” referred to the body politic, not to individual citizens of the county. Accordingly, neither the bond itself nor the underlying statute created a private right of action, and the dismissal of the claim against the bond issuer was affirmed.
Bremer v. City of Rockford
Supreme Court Case Number: 119889
Appellate Court: Second District
Appellate Court Case Number: 2-13-0920
Issue Presented: Is Section 10 of the Public Safety Employee Benefits Act, which provides that when a covered employee sustains a “catastrophic injury,” the employee is entitled to the additional benefit of having his or her health insurance premiums, as well as those of his or her partner and/or dependent children, paid by the employer, triggered when a firefighter is awarded an occupational disease disability pension?
Summary of Facts and Lower Court Holdings
Board of Education of Springfield School District No. 186 v. Attorney General of Illinois
Supreme Court Case Number: 120343
Appellate Court: Fourth District
Appellate Court Case Number: 4-14-0941
Issue Presented: Did the members of the defendant Board take “final action” within the meaningof the Open Meetings Act when (in a closed meeting) they signed a contract with the outgoing superintendent, but did not date their signatures, when the entire agreement was subsequently posted on the Board’s website prior to a public meeting, when the agreement was called for a vote and publicly approved?
Summary of Facts and Lower Court Holdings
Zahn v. North American Power & Gas, LLC
Supreme Court Case Number: 120526
Appellate Court: Certified Question from U.S. Court of Appeals for the Seventh Circuit
Appellate Court Case Number: Seventh Circuit No. 15-2332
Issue Presented: Does the Illinois Commerce Commission have exclusive jurisdiction over a reparation claim, as defined by the Illinois Supreme Court in Scheffler v. Commonwealth Edison Co., 353 Ill.Dec. 299 (2011), brought by a residential consumer against an Alternative Retail Electric Supplier, as defined by 220 ILCS 5/16-102?
Summary of Facts and Lower Court Holdings: The plaintiff allegedly began purchasing her electricity from the defendant after receiving an offer promising lower electricity rates. Plaintiff filed a class action complaint against defendant in late 2014, alleging violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, breach of contract, and unjust enrichment. The defendant moved to dismiss for lack of subject matter jurisdiction and failure to state a claim, arguing that the Illinois Commerce Commission had exclusive jurisdiction over any claim like the plaintiff’s seeking damages in connection with rates charged. The district court granted the motion to dismiss, and the plaintiff appealed to the Seventh Circuit.
Illinois Supreme Court Civil Issues Pending: Employment Law
[UPDATED THROUGH September 12, 2016]
Bayer v. Panduit Corporation
Supreme Court Case Number: 119553
Appellate Court: First District, Division One
Appellate Court Case Number: 1-13-2252
Issues Presented: (1) Did the trial court properly hold that a settlement with plaintiff’s employer in a case involving a workplace injury was in good faith for purposes of the Contribution Act where the employer agreed to continue workers’ compensation payments throughout the pendency of the employee’s tort case against other defendants, including any possible appeals? (2) Was the settlement in good faith where, because of the size of the ultimate verdict in the tort action, the plaintiff’s employer stood to recover its entire workers compensation payments, thus effectively shifting liability to the third party defendants? (3) Was the plaintiff’s employer liable under Section 5(b) of the Workers Compensation Act for attorneys fees in connection with suspended future medical payments?
Illinois Supreme Court Civil Issues Pending: Contract Law
[UPDATED THROUGH June 13, 2015]
U.S. Supreme Court Adopts Nerve Center Test for Corporate Citizenship in Diversity
A corporation’s citizenship for purposes of Federal diversity jurisdiction is governed by 28 U.S.C. 1332(c)(1): a corporation is a citizen of the state of its incorporation, and the state where its principal place of business is found. This morning, in a decision certain to have a major impact on the day-to-day functioning of the Federal courts — and attorneys’ analysis of whether removal is available in a particular case — a unanimous Supreme Court adopted a bright-line test for determining a corporation’s "principal place of business." Friend v. Hertz Corporation, [pdf] No. 08-1107.
Until today, the circuits had been badly split on the proper test under Section 1332(c)(1). The Ninth Circuit — which decided Friend — applied a "place of operations" test, ignoring the corporate headquarters and considering where a company’s plants, employees, retail locations and assets are located. Since California is the most populous state in the nation, the Court’s test has meant, in practice, that national retailers — even corporations strongly identified with other states — are routinely deemed California citizens, making it impossible for many corporations sued in California state courts to seek removal to Federal court.
In contrast, the Third Circuit applied the "center of corporate activities" test, looking to the place where the corporation’s day-to-day activity and management is centered. The Seventh Circuit applied the "nerve center" test, asking merely where the "brain" of the corporation is located. Finally, the Fifth, Sixth, Eighth, Tenth and Eleventh Circuits applied a "totality of the circumstances" test, considering the character, business purpose, nerve center, management center and general operations of the corporation. As the Supreme Court noted, Moore’s Federal Practice treatise devotes fourteen pages to describing the circuits’ various tests.
California Supreme Court Provides New Guidance to Courts Making “Choice-of-Law”
Today, in a widely anticipated decision, the California Supreme Court held that California’s interest in protecting a current resident does not trump another state’s interest in having its laws applied. This occurred in the context of an asbestos case. The defendant’s conduct occurred in Oklahoma, at a time when plaintiff was present in and a resident of that state, and Oklahoma has its own substantive law – that differs from California’s – governing the defendant’s potential liability for its Oklahoma acts. (McCann v. Foster Wheeler LLC S162435). This decision should limit forum shopping and prevent California from becoming a litigation magnet for plaintiffs who seek to sue for injuries that might otherwise be time-barred.
Terry McCann was an Oklahoma resident in the 1950s. He claimed he was exposed to asbestos from a Foster Wheeler generator at a refinery in Tulsa in 1957. After his alleged exposure, he moved to California in 1975. He was diagnosed with mesothelioma in 2005. He filed suit against Foster Wheeler in California state court.
Oklahoma has a 10-year statute of repose applicable to McCann’s claim, which would bar McCann’s lawsuit had he filed it in Oklahoma. However, McCann’s suit was timely if measured by California’s statute of limitations.
Foster Wheeler sought summary judgment, arguing that the timeliness of the action should be governed by Oklahoma law, rather than California law, and that under Oklahoma law McCann’s cause of action against Foster Wheeler was barred by Oklahoma’s statue of repose. The trial court agreed, finding that Oklahoma law governed the action, and McCann’s claims were barred. The Court of Appeal reversed, concluding that McCann’s residence in California at the time of his diagnosis trumped Oklahoma’s interest in limiting liability embodied by its statute of repose.
The California Supreme Court disagreed: California’s interest in affording a remedy to a current resident was insufficient to justify the choice of forum law over the law of another much more significantly involved jurisdiction.
GOTCHA! Ninth Circuit Reluctantly Dismisses Appeal That Was Timely When Notice of Appeal Was Filed
The Ninth Circuit recently found itself in the difficult position of having to dismiss an appeal that under its own precedent, was timely when filed, but became untimely after an intervening Supreme Court decision.
The plaintiffs brought a qui tam action against a researcher who allegedly made false statements to obtain funding from the federal government. (United States ex rel. Haight v. Catholic Healthcare West, No. 07-16857 (9th Cir. Feb. 4, 2010).) Qui tam is a fancy Latin phrase for a private enforcement action alleging fraud on the government.
The United States has a statutory right to intervene in qui tam actions, but it declined to do so here. The district court entered judgment for defendants, and the plaintiffs filed a notice of appeal 51 days later. But, you say, the time to appeal in federal court is only 30 days? Ordinarily true. But when the federal government is a “party,” the appellant has 60 days – not 30 – within which to appeal. (FRAP 4(1)(1)(B).) Under then-existing Ninth Circuit precedent, the government was a “party” to a qui tam – thereby allowing appeal within 60 days – even if it had declined to intervene. (Haycock v. Hughes Aircraft Co., (9th Cir. 1996) 98 F.3d 1100.)
But the U.S. Supreme Court recently held otherwise. Resolving a circuit split, it concluded that when the government declines to intervene, the shorter, 30 day, time to appeal applies. (United States ex rel. Eisenstein v. City of New York, New York (2009) 129 S. Ct. 2230.) The high court, while sympathetic to those who had relied on jurisdictions adopting the longer limit, deemed itself compelled to decide the jurisdictional question “irrespective of the possibility of harsh consequences.” (129 S. Ct. at 2236 n.4.) The Ninth Circuit strove mightily to avoid what it called this “inequitable” result, before it finally, relucantly, bowed to the inevitable.
