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Quick takes on Wednesday's Illinois Supreme Court Civil opinions - Court voids $10 billion Philip Morris verdict

Our panel of leading appellate attorneys review Wednesday's Illinois Supreme Court opinions in the civil cases Price v. Philip Morris, Inc., The Henderson Square Condominium Association v. LAB Townhomes LLC and Folta v. Ferro Engineering.

Price v. Philip Morris, Inc.

By Michael T. Reagan, Law Offices of Michael T. Reagan

Holding that 735 ILCS 5/2-1401 does not authorize a circuit court to vacate the judgment of a reviewing court, the supreme court vacated the judgments of both the circuit and appellate courts in this latest of many rounds following the entry of a judgment for compensatory and punitive damages in the amount of $10.1 billion following a bench trial in Madison County in March, 2003. Previously, that money judgment of the circuit court was reversed by the supreme court upon a direct review under SCR 302(b). That plurality opinion found that the Federal Trade Commission had specifically authorized the use of descriptors for light cigarettes, thereby effectively barring plaintiffs’ complaint by operation of Section 10b(1) of the Consumer Fraud Act.  There, the supreme court remanded to the circuit court with instructions to dismiss the case, which was done.

Intervening procedural steps occurred which will not be fully summarized here. The relevant history is that plaintiffs filed a petition for relief from judgment under Section 2-1401 in the circuit court, asserting that new evidence existed, primarily consisting of an amicus brief filed by the FTC in the Supreme Court of the United States which was said to reflect the opinion of the FTC on the use of such descriptors. Ultimately, the circuit court considered the merits of plaintiffs’ Section 2-1401 petition and denied it, deciding that plaintiffs failed to show that the Illinois Supreme Court would have decided the case differently if it had had the new evidence contained in plaintiffs’ petition. The appellate court reversed the circuit court, stating that it was “easy to see” how the supreme court’s analysis “would have been changed.” The appellate court found that plaintiffs were entitled to relief and, in effect, directed the circuit court to reinstate the original $10.1 billion judgment.

The supreme court traced the origin of Section 2-1401 back to the writ of coram nobis. In 1871 the writ was abolished and the predecessor to Section 2-1401 was enacted. The supreme court emphasized that relief under both the writ and the statute had to be sought from the court in which the error was committed.  Here, the court held that a litigant cannot file a Section 2-1401 petition in the circuit court to vacate the judgment of a reviewing court because it would not be filed in the same court in which the judgment being challenged was entered. The court also found support for its decision in the hierarchy of courts established by Article VI of the Illinois Constitution.

This opinion states that a litigant seeking relief from a reviewing court’s judgment under these circumstances is not without remedy, noting that “appellate courts ‘are recognized to have an inherent power to recall their mandates.’ ” The court further noted that such a power is one that “can be exercised only in extraordinary circumstances.”  Although there is no supreme court rule which generally addresses the power of a court to recall its mandate, the court noted instances of where that has been done. 

The court stated that it was expressing no opinion on the merits of a motion to recall the mandate, “should such a motion be filed in this court at a future date.”

Justice Freeman dissented at length, joined by Justice Kilbride. The dissent stated that plaintiffs had properly invoked section 2-1401 and that the appellate court had properly applied it in this case. The dissent focused on the purpose of the petition as being to promote “justice and fairness.” The dissent disagreed with the majority's statutory interpretation, and further disagreed that the constitution imposed a limitation on the circuit court’s power with respect to the judgment of a reviewing court.

The Henderson Square Condominium Association v. LAB Townhomes, LLC

By Alyssa M. Reiter, Williams, Montgomery & John Ltd.

The plaintiffs, a condominium association and its board of managers, sued the defendants who had developed and managed a real estate project. Defendants began selling units of the project in 1996. After the owners began occupying units, certain units began experiencing water seepage and damage.

In 2009, an expert issued a report concluding that the water problems were a result of poor construction workmanship. Plaintiffs filed suit in 2011 alleging five separate counts, including Count IV for breach of the Chicago Municipal Code’s prohibition against misrepresenting material facts in the course of marketing and selling real estate, and Count V for breach of a fiduciary duty.

The trial court dismissed the complaint. On appeal, the appellate court reversed the dismissal as to Counts IV and V. The Supreme Court agreed with the appellate court.  The Court found that the many fact issues precluded the case from being dismissed at its early stage. 

Plaintiffs survived a statute-of-limitations challenge because they had alleged sufficient facts to invoke fraudulent concealment and to raise a fact issue as to the date of discovery of their cause of action. The Court emphasized that determining the date when a person reasonably should know of his injury and that it was wrongfully caused is a question of fact for the trier of fact and not properly determined on a motion to dismiss.

Plaintiffs also survived a section 2-615 challenge. The Municipal Code violation allowed recovery for “any” false statement, including statements regarding future conduct. And, on the count for breach of fiduciary duty, it was premature for defendants to rely on the business judgment rule as it also raised fact questions.

Folta v. Ferro Engineering

By Michael T. Reagan, Law Offices of Michael T. Reagan

Plaintiff was exposed to products containing asbestos in the course of his employment with defendant 41 years before he was diagnosed with mesothelioma. He filed this civil action one month after his diagnosis. The defendant employer’s motion to dismiss based upon the exclusive remedy provisions of the Occupational Diseases Act was granted. The appellate court reversed that dismissal, accepting plaintiff’s argument that his disease “was not compensable under the Act” because of the operation of the 25 year period of repose in the Act, so that he had never had an opportunity to recover any benefits under the Act. That an injury “was not compensable under the Act” is one of the four categories of exceptions to the operation of exclusive remedy recognized in Meerbrey v. Marshall Field & Co., 139 Ill.2d 455 (1990). This opinion is devoted to a scholarly analysis of that exception.

Here, the injury was indisputably the type of work-related injury which fell within the purview of the Act, and therefore the employer’s liability is governed exclusively by the Act. “The litmus test is not whether there is an ability to recover benefits.”

The court said it was aware of the “harsh result” in the case. However, whether a different balance concerning the historic bargain under the Workers’ Compensation Act is a question for the legislature, and not the courts. “It is not our role to inject a compromise but, rather, to interpret the acts as written.”

Justice Freeman dissented, joined by Justice Kilbride, as was also so in Price v. Philip Morris, Inc., issued this same day.

Posted on Nov 04, 2015 by Chris Bonjean | Comments (2)
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Mr. Reagan's comment on Price says "there is no supreme court rule which generally addresses the power of a court to recall its mandate." Yet the majority opinion in Price states: "As we have explained, plaintiffs and other similarly situated litigants have a remedy: they may file a motion, pursuant to Illinois Supreme Court Rule 361 (eff. Jan. 1, 2015), to recall the mandate in the reviewing court in which the contested judgment was rendered." In addition, Rule 368(c) addresses the power of reviewing courts to recall a mandate.

Mr. Reagan's response: The statement in the summary which Mr. Park appears to take issue with is a direct restatement of this sentence from the opinion, which begins: “Although no Illinois Supreme Court rule addresses the general power of a reviewing court to recall its mandate…” The court then immediately footnoted SCR 368(c), which Mr. Park relies on, and described it as providing for such motions until either the time for seeking review from the Supreme Court has expired (in the case of appellate opinions) or the time for seeking review by SCOTUS has expired (in the case of Illinois Supreme Court opinions). Neither of those conditions was met here, which is likely why the rule was mentioned in a footnote. SCR 361, also mentioned by Mr. Park, deals generally with all motions in all reviewing courts, and does not mention mandates.


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