The Rookery Cornice

Firm News and Recent Decisions

TDR Prevails in Arbitration Capping Lengthy Family Dispute

December 9, 2011

On December 9, 2011, TDR partners Gino DiVito and Mark Horwitch obtained a complete defense victory on behalf of the managing partner of an investment partnership sued by six of the partnership’s minority partners for breach of fiduciary duty. At the American Arbitration Association hearing, the claimants requested almost $1 million in compensatory damages, plus punitive damages and attorney fees. After a five-day hearing, the three-member AAA panel unanimously awarded the claimants less than $74K, which was substantially the same amount that TDR’s client stipulated to be due (i.e., less than 1/10th of what the claimants demanded). The panel also denied in full the claimants’ request for punitive damages and attorney fees.

TDR Successfully Represents Client In A Petition for Rehearing in the Illinois Appellate Court

Daher, et al. v. Horizon Consulting Group, Inc.

December 7, 2011

TDR attorney Karina Zabicki DeHayes successfully represented TDR's clients in the Illinois Appellate Court, Second District, in a case involving anticipatory breach of a contract. After the appellate court had entered a judgment against the clients in the original appeal, during which they were represented by a different law firm, TDR successfully petitioned the appellate court to rehear the case, resulting in the appellate court affirming the original trial court judgment and reinstating damages in favor of the clients.

Illinois Supreme Court Grants TDR Client’s Petition for Leave to Appeal

November 30, 2011

Today the Illinois Supreme Court granted the petition for leave to appeal of TDR client Westfield America, Inc. and its affiliates to review an important decision of the Illinois Appellate Court concerning waivers of the attorney-client privilege in Illinois. Westfield is a well-known owner and operator of high end shopping malls throughout the United States and abroad.

In August 2011, on appeal from a contempt order of the circuit court, the Illinois Appellate Court ruled that by discussing legal issues during the negotiation of a complex business transaction, Westfield and its co-defendants in subsequently filed litigation had waived the attorney-client privilege, not just with respect to those communications that Westfield shared with the other parties to the transaction, but with respect to all of Westfield's confidential and undisclosed attorney-client privileged communications concerning the transaction.

In its petition for leave to appeal, TDR urged the Supreme Court to review the case on the grounds that it represented a significant departure from established precedent, both in Illinois and elsewhere, that it lacked reasoned policy support, and that it would have important negative consequences for Illinois attorneys and their clients. On November 30, 2011, the Illinois Supreme Court agreed to hear the case. The case is Center Partners v. Urban, Case No. 113107, consolidated with 113128).

TDR attorneys Gino L. DiVito, Karina Zabicki DeHayes, and Brian C. Haussmann have worked on the appeal for Westfield.

Tim Hudson Presents Update on New Federal Pleading Standards at PLI’s Continuing Legal Education Seminar in Chicago

October 6, 2011

Partner Tim Hudson served as a faculty member for the Practicing Law Institute's October, 2011 continuing legal education seminar entitled "Federal Civil Practice 2011: A Practical Guide to New Developments, Procedures, and Strategies." Mr. Hudson's panel presentation discussed "New Pleading Standards and Best Practices in Motion Practice"and the implications of the United States Supreme Court's rulings in Bell Atlantic Corp. v. Twombly and Ashcroft v. Iqbal. Other panelists included the Hon. James F. Holderman (Chief Judge of the United States District Court for the Northern District of Illinois) and the Hon. Morton Denlow.

TDR Resolves Case Against Industrial Real Estate Developer

June 1, 2011

In May 2011, TDR partners Caesar Tabet and Mark Horwitch reached a confidential settlement on behalf of the owner of a freezer/cooler facility pursuing breach of contract claims against a developer of industrial real estate. The case settled before jury selection after the trial judge granted TDR’s motion to bar the developer's liability expert from testifying at trial. In getting the case to the trial stage, Caesar and Mark defeated the developer’s motion to compel arbitration, motion to dismiss and motion for summary judgment on the breach of contract claims.

TDR Successfully Resolves Toxic Water Class Action Against Illinois Municipality

Marzano, et al. v. Village of Crestwood, et al.

June 1, 2011

TDR attorneys Caesar Tabet, Jeff Patton, Daniel Stanner, and Reema Kapur successfully defended the Village of Crestwood, Illinois and one of its elected officials in a class action in the Circuit Court of Cook County alleging that the Village supplied chemically contaminated and carcinogenic tap water to more than 11,000 Village residents over the course of more than two decades. Class counsel had sought millions of dollars in compensation and a variety of additional relief, but the Village was able to resolve the class-action claims for $500,000 in water-bill refunds and certain prospective water-quality monitoring expenses.

Supreme Court Resolves Defamation Case in Favor of TDR Client

May 25, 2011

On May 25, 2011, the Illinois Supreme Court resolved the defamation and punitive damages case of Leyshon v. Diehl Controls North America, Inc., et al. in favor of TDR’s client, the former President and CEO of a North American subsidiary of a German conglomerate and against Diehl Controls and one of its executives. 949 N.E.2d 1098, 2011 Ill. LEXIS 865 (Ill. 2011). This followed our 2010 victory in the Illinois Appellate Court which affirmed TDR’s resounding victory at trial on behalf of our client, Leyshon v. Diehl Controls North America, Inc., 407 Ill. App. 3d 1, 946 N.E.2d 864, 349 Ill. Dec. 368 (1st Dist. 2010).

TDR’s client, a highly respected electronics executive, sued Diehl Controls and the company’s Chairman for their breach of an executive employment agreement and for defamation. After an eight-day jury trial, the jury found in favor of TDR’s client on all counts and awarded him over $13 million in compensatory and punitive damages. The jury’s award is believed to be the largest in this type of case in U.S. history. The trial court denied the defendants’ post-trial motion but granted their request to reduce the punitive damages award to $6 million.

On appeal, the defendants challenged the jury’s finding of liability on the defamation claim and the amount of damages awarded. They argued that the “for cause” statement was protected under the “innocent-construction rule,” because it could reasonably be innocently interpreted. The defendants also argued that they were protected by the “invited-defamation” defense, because the plaintiff “invited” the defendants’ defamatory statements. The defendants conceded, however, that they did not raise the invited-defamation defense until their post-trial motion.

The appellate court upheld the lower court’s decision. The court found that the “for cause” statement fell within the definition of defamation per se, because it was a statement “imputing an inability to perform or want of professional integrity in performing employment duties,” and “imputing a lack of ability or … otherwise prejudic[ing the plaintiff] in his profession or business.” The court held that, given the context in which the statement was made, it could not reasonably be construed as having an innocent construction. The appellate court further held that the defendants’ failure to raise the defense of invited-defamation prior to the jury verdict denied TDR’s client the opportunity to respond to a defense that, if proven, would have been a complete defense to his defamation claim. Therefore, the court found that the defendants had forfeited the invited-defamation defense. The appellate court went on to uphold the $2 million in compensatory damages and $6 million in punitive damages awarded by the trial court.

TDR partners Caesar A. Tabet and Mark Horwitch represented TDR’s client throughout the entire case, including during the two-week jury trial.

Leyshon v. Diehl Controls North America, Inc., et al.

49 N.E.2d 1098, 2011 Ill. LEXIS 865 (Ill. 2011)

TDR Wins Important Insurance Coverage Dispute

April 28, 2010

On April 28, 2010, Judge Peter Flynn of the Circuit Court of Cook County, Illinois, Chancery Division, awarded summary judgment to our client Walsh Construction Company in an insurance coverage lawsuit against it filed by Scottsdale Insurance Company. Walsh was represented by TDR attorneys Daniel L. Stanner, Michael J. Grant, and John M. Fitzgerald. Judge Flynn's ruling requires Scottsdale Insurance to provide a defense to Walsh, a general contractor, in a personal injury lawsuit filed by a subcontractor's employee. Judge Flynn's ruling addressed an emerging area in insurance coverage litigation regarding sole-negligence exclusions in additional insured endorsements. The Court rejected Scottsdale's arguments that the sole negligence exclusion applied to bar coverage and granted Walsh's cross motion for summary judgment.

Scottsdale Insurance Co. v. Walsh Construction

Case No. 09 CH 33074

Verdict for Hospira in ERISA Class-Action Lawsuit

April 23, 2010

On April 23, 2010, the United States District Court for the Northern District of Illinois found in favor of our client Hospira, Inc. and Abbott Laboratories on all counts of an ERISA class-action lawsuit filed against both companies in 2004. In the lawsuit, representatives of an 8,000-employee class claimed that Hospira and Abbott intended to interfere with their retirement benefits through Abbott’s spin off of its Hospital Products Division, which established Hospira as an independent company, and the implementation of a two-year reciprocal no-hire policy. The suit, in which the plaintiff class sought over $300 million in lost employee benefits, was tried over a period of three weeks in 2009.

In a 97-page opinion, the Court found that neither Hospira nor Abbott violated ERISA in connection with the spin off or the no-hire policy. Of critical importance to the Court’s decision was the testimony of the defendants’ witnesses, including Hospira’s CEO and COO, which the Court found was "highly credible, internally consistent, and amply corroborated by the unquestionably authentic documentary evidence." In ruling in favor of the defendants, the Court also vindicated Abbott’s and Hospira’s strategic decisionmaking and human resource policies relating to the spin off. The Court explained that "Hospira has been a successful, profitable enterprise in the years since the spin, no doubt in large part because it retained the talent it had at the time it became independent of Abbott."

Hospira was represented in this matter by TDR partners Christopher Liguori and Daniel Konieczny, associate Brian Haussmann, and legal assistant Diane Tasic.

Nauman v. Abbott Laboratories and Hospira, Inc.

Case No. 04-cv-07199 (N.D. Ill.)

DeHayes Selected as 2nd VP of the Women’s Bar Association of Illinois

March 23, 2010

Karina DeHayes was selected to be the second vice president of the Women's Bar Association of Illinois ("WBAI") beginning in June 2010. From that position, Karina will automatically ascend to the presidency in 2012-13, becoming the organization's 98th president. DeHayes recently co-chaired the WBAI's Judicial Reception, attended by nearly 170 judges practicing in the state and federal courts of Illinois. DeHayes has been a board member of the WBAI since 2003 and has served as a board member of the Women's Bar Foundation since 2007.

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