Frank James McGarr

The case involved a dispute over enforcement of a 1973 General Indemnity Agreement (GIA) that Windowmaster Corporation and the Walbergs signed as indemnitors in exchange for Safeco issuing construction performance bonds on a subcontract with Morse/Diesel. After Morse/Diesel declared Windowmaster in default on the Rush Presbyterian project, Safeco arranged via letter agreement for the work to continue with Windowmaster's involvement and later sought to recover its expenses from the indemnitors under the GIA. The Walbergs moved for summary judgment, arguing Safeco had violated the GIA by using a remedy outside the three options expressly listed, while Safeco moved for summary judgment on liability, contending the remedies were not exclusive. The court denied the Walbergs' motion and granted Safeco's, holding that the GIA contained no exclusivity clause, the letter agreement was a permissible additional remedy, and no genuine issues of fact existed as to the contract's existence or Safeco's incurrence of expenses.

business & regulatoryprocedure

This case involves the Chicago Pacific Corporation (CPC), successor to the Chicago, Rock Island and Pacific Railroad, petitioning for an injunction to stop George and Delores Furry from prosecuting their personal injury lawsuit in Nebraska federal court alleging asbestos exposure during George Furry's employment with the railroad from 1957 to 1979. The court granted the injunction, barring the Furrys from pursuing their claim. The core reasoning was that the railroad's Section 77 reorganization under the Bankruptcy Act of 1898 amounted to a liquidation, as the company ceased operations, discharging all claims not timely filed by the April 12, 1984 bar date established in the consummation order. The court followed precedent from In re Erie Lackawanna Railway Company, noting that no debtor entity remained against which to proceed, and rejected the due process argument because the plaintiffs were not known creditors entitled to personal notice beyond publication.

proceduretorts & liabilitybusiness & regulatory

This case involves Soft Sheen Products, Inc. suing Revlon, Inc. and its subsidiary for trademark and trade dress infringement regarding hair care products targeted at the black community, specifically the "Care Free Curl" line with its distinctive bright yellow and red packaging. The court found a likelihood of confusion with Revlon's "Creme of Nature" shampoo and instant moisturizer, which adopted similar packaging in 1984-1985, while Soft Sheen had established secondary meaning through extensive sales and promotion. Based on these findings, the court granted a preliminary injunction prohibiting Revlon from using the infringing trade dress, concluding that the balance of harms and public interest favored protection of Soft Sheen's rights.

business & regulatoryproperty

The case involved an appeal from a bankruptcy court's denial of a motion to compel the trustee of a defunct non-profit community action agency to abandon grant funds and property provided by state and federal agencies. The district court affirmed the bankruptcy court's order, holding that the assets were property of the bankruptcy estate under section 541 and that the trustee could sell the property and use the proceeds to pay pre-petition creditors and administrative expenses. The court reasoned that the debtor held legal and equitable interests in the funds with no trust relationship excluding them from the estate, and that payments to creditors for goods and services were consistent with the grant purposes, so no equitable liens in favor of the grantors applied. It further concluded that the trustee's fees were intertwined with fulfilling those purposes and could be paid from the funds.

business & regulatoryfederal powerproperty

This case involves a patent infringement dispute in which plaintiffs Water Technologies Corporation and others sued defendants Calco, Ltd., William J. Gartner, and Robert Kalnitz over the validity and infringement of several patents related to water treatment technology. Following an earlier ruling that the patents were valid and infringed, with an award of $1.04 million in damages plus attorneys' fees and interest, the court addressed post-trial motions including defendants' requests to substitute a reasonable royalty for lost profits damages and to limit Gartner's personal liability, plaintiffs' petitions for costs, fees, and prejudgment interest, and Kalnitz's motion for Rule 11 sanctions. The court denied the motions to alter the judgment, finding sufficient evidence supported the lost profits measure and Gartner's significant role in the infringement, granted plaintiffs $5,055.16 in costs, $150,000 in attorneys' fees, and $221,102 in prejudgment interest, and denied sanctions against Kalnitz, concluding the claims were reasonably based under the applicable rules.

business & regulatoryprocedure

This case involves a patent infringement lawsuit brought by Water Technologies Corp., its subsidiary, and Kansas State University Research Foundation against Calco, Ltd. and William J. Gartner over four patents for demand bactericide resins used to disinfect water. The plaintiffs alleged that the defendants' Pocket Purifier straws infringed the patents through manufacture, use, and sale. The court found the patents valid and willfully infringed, based on evidence that the defendants examined the patented resins and patents before producing and selling their competing products. The court awarded $1,040,000 in damages (including doubling for willfulness), prejudgment interest, attorneys' fees, and a permanent injunction against further infringement by the defendants.

business & regulatory

This case is an appeal from a bankruptcy court order dismissing an adversary complaint filed by Suburban Bank of Cary-Grove against debtor Caryl W. Riggsby. The bank sought to prevent discharge of a $130,000 debt, alleging Riggsby obtained the loan through a materially false financial statement, but filed the complaint after the July 15, 1983 bar date set by the court. The district court affirmed the dismissal, holding that the new Federal Bankruptcy Rules (effective August 1, 1983) required any extension request to be made before the original deadline, and even under the superseded rules allowing excusable neglect, the bank's reliance on the trustee's statements did not qualify as excusable neglect due to prejudice to the debtor. The court further found no injustice in applying the new rules because the result would be the same under the old rules.

business & regulatoryprocedure

This case is an appeal from a bankruptcy court's denial of Elscint's motion for distribution of funds held in escrow from proceeds of accounts receivable in the Chapter 11 reorganization of the Xonics Group of companies. The district court affirmed the ruling that the bankruptcy court lacked jurisdiction over the dispute between Elscint and FWFC, as the debtor had no remaining interest in the escrowed funds and the matter involved only a disagreement between two creditors. The court explained that the dispute was neither a core proceeding arising under the Bankruptcy Code nor a related proceeding, since resolution was not necessary for administering the estate and the funds were no longer under the trustee's control. It further noted that even if related, the bankruptcy court could not enter a final order without consent from all parties, which was not given here.

procedurebusiness & regulatory

The case concerned an appeal by the United States from a bankruptcy court order that preliminarily enjoined the IRS from collecting a responsible person penalty assessed under I.R.C. § 6672 against the principal officer and shareholder of the debtor company for unpaid federal withholding taxes. The district court reversed the injunction, ruling that the bankruptcy court lacked jurisdiction because the officer's § 6672 liability is separate and distinct from the debtor's corporate tax obligations and does not involve property of the estate. The court further held that the United States had not waived sovereign immunity under 11 U.S.C. § 106(a), as the requested injunctive relief did not arise from the same transaction as the government's claim against the debtor, and that the Anti-Injunction Act barred the suit with no applicable exception.

taxesbusiness & regulatoryprocedurefederal power

This case involves a dispute between Trak Microcomputer Corporation and its investors, including Singapore-based Wearne entities, arising from failed negotiations and investments, with claims of fraud, RICO violations, breach of an employment agreement, and related counterclaims. The court addressed multiple motions, including plaintiffs' request to compel Wearnes Tech to answer the complaint and cross-motions to dismiss the counterclaim and portions of the amended complaint. It granted the motion to compel, finding that mail service was effective under Federal Rule of Civil Procedure 4 because the returned envelope marked "refused" provided sufficient evidence of delivery to the addressee, especially given the defendant's actual notice through counsel. The court denied the motions to dismiss, holding that the fraud allegations met Rule 9(b) particularity requirements by detailing the time, nature, and parties involved in the misrepresentations, that a RICO pattern of racketeering activity was adequately pled through continuous and related acts, and that the breach of contract count stated a viable claim based on the defendants' alleged majority shareholder status and authority to enter employment agreements.

business & regulatoryproceduretorts & liability

This case involved plaintiff Sally Beauty seeking reimbursement from defendant Nexxus for the costs of formal service of process after Sally mailed the summons and complaint with a request for acknowledgment, which Nexxus's counsel refused unless granted an extension of time to respond. The court ordered Nexxus to reimburse Sally $307.32 within thirty days for the expense of hiring a special process server to complete service. The court reasoned that the amended federal rule on mail service is designed to eliminate the costs of formal service when responsible parties acknowledge receipt without conditions, and no authority exists under the rule to impose such conditions as an extension of time.

procedure

This case involved a class action lawsuit by women eligible for free inpatient delivery services under Chicago's Project 502, a federally funded program under Title V of the Social Security Act for high-risk pregnancies. The plaintiffs, assigned to Cook County Hospital, sued the City of Chicago and Board of Health after the defendants refused to pay their medical bills, citing an alleged agreement with the hospital. The court denied the defendants' motion to implead additional parties and granted summary judgment to the plaintiffs. It reasoned that federal law and regulations require states and localities to pay reasonable costs for such services to eligible low-income participants, and any internal disputes with the hospital did not affect the plaintiffs' rights to reimbursement.

healthcarecivil rightsfederal powerprocedure

In this case, plaintiff William O'Young sued his former employer Hobart Corporation and supervisor James Frenchy, alleging race and national origin discrimination in violation of Title VII of the 1964 Civil Rights Act, 42 U.S.C. § 1981, and Article I, § 17 of the Illinois Constitution. The defendants moved to dismiss the claims, primarily arguing that the plaintiff failed to timely file his discrimination charge with the EEOC within the required 180 days (or 300 days in deferral states) and did not meet the Illinois Department of Human Rights' 180-day filing deadline. The court dismissed the Title VII counts (I and IV) because the plaintiff's untimely state filing precluded the extended 300-day federal period, and dismissed the Illinois Constitution counts (III and VI) on the grounds that the Illinois Human Rights Act provides the exclusive enforcement mechanism with its 180-day limit, preempting direct constitutional claims. The court denied dismissal of the § 1981 counts (II and V), allowing those federal claims to proceed.

civil rightslabor & employment

This case involved plaintiffs who purchased original works of art in lithographic plate form from defendant corporations and alleged violations of federal and Illinois securities laws, common law fraud, breach of fiduciary duty, and negligence against the sellers, appraisers, and a law firm. The court considered motions to dismiss Counts I-III. The core issue was whether the transactions qualified as the sale of a 'security' under the Howey test for an investment contract. The court held that the transactions did not meet the 'common enterprise' requirement because they lacked horizontal commonality or pooling of investors' resources, as each sale involved unique artwork through separate contracts at different times and prices. Accordingly, the securities claims in Counts I and II were dismissed as to all defendants, and Count III was dismissed for lack of subject matter jurisdiction with leave to amend.

business & regulatoryprocedure

In Terson Co., Inc. v. Pension Benefit Guar. Corp., the plaintiff employer sought a preliminary injunction to prevent pension fund trustees from collecting approximately $3.5 million in withdrawal liability under the Multiemployer Pension Plan Amendments Act (MPPAA) following the sale of its bakery operations, where the buyer assumed the contribution obligations. The court denied the motion for a preliminary injunction. It reasoned that the plaintiff failed to demonstrate irreparable injury or the lack of an adequate remedy at law, as the MPPAA requires disputes over withdrawal liability to proceed first through compulsory arbitration before any judicial review, and that requiring arbitration does not violate the plaintiff's Seventh Amendment jury trial rights under Supreme Court precedent like Atlas Roofing.

labor & employmentbusiness & regulatory

The case involved the City of West Chicago challenging the Nuclear Regulatory Commission's (NRC) approval of a license amendment allowing Kerr-McGee to demolish buildings at a former thorium processing facility and issues with the agency's handling of the site's decommissioning plan. The city sought a preliminary injunction, claiming violations of NRC regulations, the Atomic Energy Act, due process, and the National Environmental Policy Act (NEPA), including lack of notice and hearing. The court decided it lacked subject matter jurisdiction because review of final NRC orders belongs exclusively to the court of appeals, and claims regarding the decommissioning plan were not yet ripe for review since no final order had been issued. The core reasoning was that specific statutory grants of jurisdiction to the appellate court superseded general federal question or mandamus jurisdiction, and premature claims could not be addressed until a final agency action.

environmentfederal powerprocedure

This case involved emotionally disturbed children attending private schools who challenged an Illinois rule excluding counseling and therapeutic services from state-funded special education or related services under the Education for All Handicapped Children Act, the Rehabilitation Act, constitutional provisions, and state law. The plaintiffs sought declaratory and injunctive relief against state education officials, alleging deprivation of appropriate public education and discrimination. The court granted in part and denied in part the defendants' motion to dismiss, finding that the plaintiffs had standing due to their direct interest in the services and that federal jurisdiction existed under relevant statutes. Core reasoning included distinctions from prior cases where alternative services were available and recognition that the rule directly impacted the children's access to benefits.

civil rightsfederal power

This case involves a contribution claim arising from a 1970s limited partnership formed to develop an apartment building, where partners including Norman and Kal guaranteed a letter of credit that was drawn upon after the project defaulted. Norman obtained a default judgment against Kal in Florida but later filed this equitable action in Illinois federal court after the Florida judgment was invalidated for lack of personal jurisdiction over Kal. Kal moved for summary judgment, arguing the claim was barred by Florida's four-year statute of limitations under Illinois' borrowing statute or by laches due to delay and faded memories. The court denied the motion, holding that the action was timely filed under both Illinois and Florida law and that Kal failed to show unreasonable delay or material prejudice sufficient to support laches. The decision applied Illinois choice-of-law rules in this diversity case and rejected the defenses based on the timing of the Florida proceedings and the absence of demonstrated prejudice.

business & regulatoryprocedure

The case involved a hospital that received federal construction funds under the Hill-Burton Act and was required to provide free care to indigents in return; it sought Medicare reimbursement for the net costs of that care during 1977 and 1978, but the fiscal intermediary and Provider Reimbursement Review Board disallowed the claim. The court granted summary judgment for the Department of Health and Human Services, affirming the denial. It held that the costs were not reimbursable because Medicare law bars payment for services where recipients have no legal obligation to pay and prohibits Medicare from bearing costs associated with non-Medicare patients. The court also noted statutory and regulatory provisions keeping the Medicare and Hill-Burton programs separate and rejected the argument that indirect benefits to Medicare patients justified reimbursement.

healthcarefederal power

The case involved the Federal Trade Commission seeking a preliminary injunction under Section 13(b) of the FTC Act to block Great Lakes Chemical Corporation's proposed acquisition of Velsicol Chemical Corporation's bromine-related assets, including a research facility, a plant, and bromine fields, on the ground that the deal would likely substantially lessen competition under Section 7 of the Clayton Act. After a four-day hearing with testimony, documents, and other evidence, the court denied the injunction. The court reasoned that Velsicol's bromine operations were already in a weakened, non-competitive condition with minimal activity and poor prospects, so the acquisition would not probably harm competition, while equities such as preserving assets for research and development, benefiting the local community, and allowing a struggling business to exit outweighed any potential harm; it further noted that divestiture would remain an effective remedy if the FTC later prevailed on the merits.

business & regulatory