Articles Posted in Business Litigation

Tire Services Co. and AA Truck & Trailer Repair entered into an agreement that called for plaintiff Tire Services to sell approximately $450,000 worth of tires to AA Truck. AA Truck agreed and took delivery, but paid just $231,142 of that amount before it stopped making payments in December 2009. 

When the payments stopped, Tire Services filed suit in the Circuit Court of Cook County against AA Truck for the balance remaining unpaid, — $223,326 pursuant to the parties’ contract.

AA Truck claimed that it stopped making payments because the sales terms were confusing and that allegedly Tire Services changed the prices of the tires it sold to AA Truck. 

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Conxall Corp. was the supplier of custom cables and connectors to its customer, Mine Safety Appliances Co. (MSA), the third-party defendant in this case. 

MSA later provided drawings and 3-D (3-dimensional) models to the defendant ICON Systems to enable it to offer a quote and supply the same product.

The plaintiff Conxall contended that the drawings were trade secrets. ICON argued that the drawings and files contained no information that was actually secret or otherwise unknown in the industry. In furtherance of that argument, it maintained that the drawings and models were not needed to create ICON’s product, that ICON’s product was an improvement on Conxall’s product and that MSA had no duty to keep the materials confidential.

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Hubert Walker represented a class of truck owner-operators who sued Trailer Transit Inc., a broker of trucking services, for breach of contract. The lawsuit was filed in an Indiana state court. The underlying lawsuit concerned a lease agreement between Walker, who owned and operated a long-haul truck and trailer transit. Under the contract, Trailer Transit leased Walker’s equipment and Walker picked up and delivered shipments arranged by Trailer Transit. 

The parties’ agreement required Trailer Transit to pay Walker 71% of the gross revenues derived from the use of the truck, less all items intended to reimburse trailer transit for special services.

Walker alleged in his complaint that Trailer Transit violated the lease agreement with him and hundreds of other truckers by charging “add-on fees” to customers that exceeded the costs of special services. Because the overcharge fees were not intended to be reimbursed to Trailer Transit, Walker maintained that the truckers were entitled to a portion of those fees under the lease agreement. The complaint alleged that the truckers would be entitled to 71% of the overcharge.

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In April 2009, the plaintiffs brought a lawsuit against James W. Hall, Cassandra McCord, JWH Management Inc. and JWH Family Partnership Ltd. Right after the lawsuit was brought, another group of plaintiffs filed a separate lawsuit naming some of the same defendants and then others. 

In the first litigation — the Bernstein litigation — the defendants were sued for breach of four promissory notes in the amount of $450,000. 

In the second lawsuit, the BMD litigation, Heiman and Sussex were defendants in the second lawsuit, but not in the Bernstein litigation. The defendants in the BMD litigation moved to consolidate the two cases pointing out that in both, James W. Hall and the JWH Family Partnership were being sued for failing to honor promissory notes;  in both cases, these defendants were moving for dismissal, claiming lack of personal jurisdiction. 

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In January 2003, Michael Henderson, the defendant, wanted to rehabilitate real estate he owned. He submitted a loan application to the plaintiff, National Lending Services Inc. National Lending approved Henderson’s loan. The loan provided for an adjustable rate interest in which the interest only was paid until the loan matured on June 1, 2004. 

Henderson signed a trust agreement providing that National Lending would distribute the loan funds as necessary to Chicago Title & Trust, which would then pay the construction companies that were doing the rehab work on the property.

Every month, Henderson would pay $185.83 as the interest payment required on the note. When the note matured in June 2004, rather than paying the remainder of the $322,983.41 that was due, he continued to make monthly interest payments. Finally, on Dec. 2, 2010, National Lending filed a lawsuit against Henderson for the unpaid balance of the note, plus per diem additional charges. Henderson appeared pro se in the case. 

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The 7th Circuit Court of Appeals in Chicago has affirmed a ruling by the federal district court judge over a copyright lawsuit involving a song. Guy Hobbs composed a song entitled “Natasha” while working on a Russian cruise ship.  This song was registered as a copyright in the United Kingdom in 1983.  His attempts to publish the song were unsuccessful. 

A few years later, Elton John and Bernie Taupin released a song entitled “Nikita.”  “Nikita” was released through a publishing company; Hobbs had sent a copy of “Natasha”  to the same company. Hobbs believed that “Nikita” was a knock-off of his song “Natasha” and demanded compensation from John and Taupin. 

Hobbs was unsuccessful, and he filed suit in 2012 asserting copyright infringement. The U.S. District Court dismissed Hobbs’ suit for failure to state a claim;  Hobbs appealed. 

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The Illinois Appellate Court has affirmed the decision of a Cook County Circuit Court judge in a dispute that arose over a rental property. Randy Franks entered into a commercial lease agreement with Sheldon Broder. Franks was leasing a property to use as a retail store. Franks paid Broder a security deposit of $4,012 and monthly rent of $2,300 plus one-third of the real estate taxes for the property. The lease agreement was made on March 30, 1996. The rent was raised to $3,900 in 2004. Franks made his rent payments on time for the entire term of the lease.

On Nov. 28, 2006, Franks sent a letter to Broder stating that he planned to end the lease on Jan. 15, 2007. Franks also asked if Broder would allow the use of his security deposit ($4,012) to cover the remaining 1 ½ months of rent. Broder responded that the lease stated that the security deposit could not be applied toward the rent and required Franks to pay the rent for the remaining part of the lease. 

Franks paid Broder the December 2006 rent and then informed Broder that he would be out of the country in January. Franks and Broder agreed to allow the use of the space for storage through Feb. 15, 2007. 

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Archon Construction Co. was hired by the defendant U.S. Shelter to install a sewer system for a development, which was a small residential subdivision in Elgin. The contract between the parties was signed on June 5, 2005 and specified the types and quantities of material to be used by Archon. 

For example, PVC piping was specified. Any additional work beyond the original scope was, according to the contract, to be completed at an agreed upon price, time and materials. The City of Elgin was to review the work done by Archon within a year after completion of the work. U.S. Shelter hired a civil engineering firm to oversee Archon’s installation of the sewer system.  This was to make sure that it met with both the contract’s specifications and the City of Elgin’s legal requirements.

After Archon completed the installation, the engineering company reported that the work was done satisfactorily and complied with the contract and Elgin’s requirements.

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Cathy Stackhouse obtained a $4.5 million jury verdict against Lakemoor Golf Course and Royce Realty for an accident that took place on Lakemoor’s golf course. The golf course and Royce Realty were insured by Indiana Insurance Co.

Royce Realty was the manager of several golf courses, shopping centers and apartment buildings. Because of the need for protection, it purchased a commercial general liability policy from Indiana Insurance Co. But Indiana Insurance Co. attempted to severely restrict its own liability by attaching an endorsement that limited the policy’s coverage to claims “arising out of the ownership, maintenance or use of Royce’s headquarters in Oak Brook and operations necessary or incidental to those premises.”  After the Stackhouse verdict against Lakemoor and Royce, Indiana Insurance sued in the Chancery court for a declaratory judgment that the Stackhouse judgment was not covered. 

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Slawomir Lubowicki and his wife, Agnieszka Lubowicka, held a mortgage from the plaintiff, CitiMortgage (Citi) in the amount of $329,000 for their home in Mount Prospect, Ill. In August 2009, Citi filed a lawsuit alleging that Lubowicki and his wife were in default in the payment of their mortgage and sought a writ of foreclosure on the property.

The special process server hired to deliver service of summons on the Lubowicki family testified that he served Lubowicki’s wife on Aug. 18, 2009, though his description of the time at which he served it was inconsistent with his affidavits. Further, the process server claimed that he mailed a copy of the summons and complaint in a sealed envelope, addressed to Lubowicki at his residence in Mount Prospect. 

On Aug. 30, 2009, the court found that Lubowicki and his wife were in default for failing to appear or plead and entered a judgment for foreclosure and sale of the property. Subsequently, the property was sold in a judicial foreclosure sale that was confirmed by the trial judge on March 10, 2011.

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