Chicago Business Litigation Lawyer Blog

Latest from Chicago Business Litigation Lawyer Blog

There are countless stories of a rock band’s members fighting over music and money, but this time it’s the widow of a band’s recently deceased member who’s fighting with the remaining members of the band over the band’s value. When the singer Chris Cornell died, his widow, Vicky Cornell, inherited his share of the interest in the band, Soundgarden. The other members have offered to buy Cornell’s share for $278,000, but she alleges that amount represents just a fraction of what her share in the band is worth. Cornell is suing the remaining members of Soundgarden for allegedly devaluing her…
A company that provided administrative and payroll services was acquired by a bank under a stock purchase agreement. The agreement provided for the escrow of $2 million dollars, that was to be released to the sellers after a period of time had passed after the sale. Several months after the sale, a former employee came forward to reveal potentially fraudulent practices on the part of the administrative company. After an investigation by an outside law firm, the bank demanded indemnification from the sellers, but the sellers refused. The bank then sued in an attempt to recover money it had paid…
For producers and manufacturers alike, supply contracts have many advantages. For manufacturers, it ensures a steady supply of raw goods for manufacturing, and for producers, it secures a steady stream of revenue. All contracts though come with the risk that one of the parties will breach them. In a recent decision, the Seventh Circuit provided guidance for interpreting the “adequate assurances” provision of Section 2-609 of the Uniform Commercial Code. The dispute at issue is nearly a decade old. In 2009, BRC Rubber & Plastics Inc., a designer, and manufacturer of rubber and plastic products primarily for the automotive industry…
Two inventors who were entitled to royalties on the sales of products sued the purchaser of their former company over their royalty rights. The litigation and arbitration took years, and after the third round of arbitration, the arbitrator determined that the inventors were not entitled to compensation from the company they sued. Despite this finding, the two continued to engage in litigation against the firm. After their final suit was dismissed in the district court, the company sought sanctions for bringing a groundless lawsuit. The district court granted the motion, finding that the suit had been barred by the doctrine…
Statutory fee-shifting is usually meant to incentivize plaintiffs to bring claims involving important rights but relatively low monetary damages. Some statutes provide for fee-shifting not only to successful plaintiffs but also to successful defendants. As the recent decision in the case of Multimedia Sales & Marketing, Inc. v. Marzullo illustrates, plaintiffs considering bringing trade secret misappropriation claims in Illinois courts would be wise to review their claims before filing so to ensure that their claims are not meritless. The plaintiff in the lawsuit, Multimedia Sales & Marketing, Inc., is a radio advertiser who sued a competitor, Radio Advertising, Inc., along…
A disgruntled investor sued the organization that regulates registrations for certain securities brokers after he lost his investment. The investor argued that the securities broker had a history of misconduct dating back more than 30 years and should have had his membership revoked under the organization’s bylaws. The investor claimed that because the organization violated its own bylaws, it was liable for the actions of the securities broker. The district court determined that the organization did not violate the bylaws because the conduct of the broker had not led to the expulsion of an associated organization, only a voluntary withdrawal.…
An AI company harvested publicly available photographs from social media sites across the internet and then used those photographs to derive a biometric facial scan of each individual in the photograph. The company sold this database to law enforcement agencies to use in identifying persons of interest or unknown individuals. A woman sued in a class action, arguing that the harvesting of biometric data violated Illinois’ Biometric Information Privacy Act. The company removed the case to federal court, and the federal court ruled that the plaintiffs’ claims lacked standing under Article III. The appellate court agreed with the district court…
A plastics company purchased ingredients from a producer of rubber products for many years under a series of short-term agreements. A few years after signing a long-term agreement, the rubber producer attempted to unilaterally raise the price of the products it was selling to the plastics company. When the plastics company protested that this was not allowed under the agreement, the rubber producer failed to make scheduled deliveries on time. The plastics company then sought an alternate source of rubber and sued the producer for the difference in cost it paid. The district court determined that the rubber company failed…
Amazon claims it fired Chris Smalls, a management associate, in March for violating safety procedures by continuing to come to work after having been exposed to COVID-19, despite the fact that the company says it offered to pay him to stay home for 14 days after the exposure. Smalls, who is suing his former employer in the Eastern District of New York for discrimination and retaliation, tells a different story. According to Smalls, Amazon failed to take several safety precautions related to the pandemic, including taking employees’ temperatures before allowing them on the premises; providing hand sanitizer or personal protective…
Everyone knows who Sherlock Holmes is. Even if you haven’t read one of Sir Arthur Conan Doyle’s short stories featuring the famous detective, you’ve no doubt seen, or at least heard of, one of the many adaptations of Holmes and his adventures into other works of fiction, from other books and short stories, to movies and TV shows. He is known as the cold, calculating detective who sees clues everywhere, but is either incapable of taking into consideration the feelings of the people around him, or just lacks the patience to do so. That is the Sherlock Holmes of the…
If you think you’d be better off leaving your job to start your own company that does the same thing as your employer, you’d better check the terms of your employment contract first. A swimming coach based in New Jersey, John Alaimo, worked for NYS Aquatics Inc. of Goshen, which has run the “New York Sharks” swim team since 2003. Although Alaimo renewed his contract with NYSA in the fall of 2019, less than a year later, in the summer of 2020, he started his own swimming company that likewise had a shark-themed name: Shark Swimming, LLC. NYSA responded by…
An Illinois Appellate Court breathed new life into a petition by Chicago Bears legend Richard Dent to learn the identities of the anonymous individuals who he claims published defamatory statements about him. According to Dent’s Illinois Supreme Court Rule 224 petition, these defamatory statements ultimately cost Dent and his business a marketing contract with the energy supplier Constellation NewEnergy. Dent played as a defensive end in the NFL from 1983-1997, including 12 seasons with the Chicago Bears. He was the MVP in the Bears’ 1985 Super Bowl victory, and was elected to the Pro Football Hall of Fame in 2011.…
When a class action settles, class members generally have three options: (1) remain a part of the class, (2) opt-out of the settlement, or (3) object to the settlement. Many courts have bemoaned a perceived rise in the abuse of the third option by class members using a technique commonly referred to as “objector blackmail.” Objector blackmail involves class members filing frivolous objections to a class settlement, appealing decisions approving the settlement over such objections, and then seeking to obtain a side payment from the defendant in exchange for dismissal of their appeals. A recent Seventh Circuit opinion may spell…
After a non-profit discovered some alleged invoicing irregularities it sued its founders and former directors and the companies that submitted the allegedly fraudulent invoices. The trial court dismissed the complaint. An Illinois appellate court reversed the trial court’s dismissal with regard to several of the fraud claims but affirmed the lower court’s dismissal of the remaining claims. In 2002, Nancy Morgan and Donna Sardina formed and incorporated the National Alliance of Wound Care (NAWCO), a non-profit corporation that provides education and credentials for medical personnel in wound injuries. At its founding, Morgan and Sardina were NAWCO’s sole directors but were…
After discussions about going public, Promega Corp., a privately-held biotech company based in Wisconsin, decided instead to remain a privately held company back in 2014 and tried to buy back the stock owned by its minority shareholders and regain a controlling interest in the company. Those minority shareholders claimed the price at which Promega wanted to buy back their shares was deeply discounted, and when they tried to negotiate for a higher price point, Promega allegedly refused, which ultimately led to the massive lawsuit between the company and its minority shareholders that dragged on for about five years. The team…
Terminating an employee can be a difficult thing for an employer. It can become even more difficult if the former employee decides to sue her former employer. An Illinois appellate court recently addressed such a situation and ultimately found that the trial court had properly granted summary judgment in favor of the employer on the former employee’s claims of retaliatory discharge and intentional infliction of emotional distress. The plaintiff, Rita DiPietro began working for GATX Corporation, a Chicago-based equipment finance company, in July 2016 as a customer service representative. During her employment, the plaintiff took sick leave occasionally to…