R.J. VanSwol obtained the affirmance of summary judgment on the issue of whether a property owner could deselect its own policy in an underlying slip-and-fall case and seek coverage under a policy issued to the contractor that had agreed to clear snow and ice from the property. The contractor’s insurer argued that the claims against the property owner did not come within the scope of coverage, but the trial court found that the insurer had to defend under its additional-insured endorsement, and the First District of the Illinois Appellate Court affirmed. P&W therefore successfully shifted the risk away from the property owner’s policy. Pekin Ins. Co. v. AP POB Bannockburn, LLC, 2017 IL App (1st) 163159-U.
Tom Underwood and Mike Sanders successfully defeated an appeal from the dismissal of the claims against their client, an attorney, in a suit alleging that he and another attorney had caused an insurer to settle a suit alleging bad-faith failure to settle. P&W’s client had represented the driver of a vehicle involved in an accident, and the other attorney had represented the driver’s employer. After trial in the accident case, the employer assigned its rights against the insurer to the plaintiff, and the insurer settled the bad-faith suit that the plaintiff brought against the insurer. The trial court held, and the appellate court affirmed, that P&W’s client was not the proximate cause of the insurer’s damages because his client had not assigned any rights against the insurer to the underlying plaintiff. Century-Nat’l Ins. Co. v. Schoen, 2017 IL App (1st) 163261-U.
R.J. VanSwol is published in the Fall 2017 issue of the Family Advocate, the magazine of the ABA Section of Family Law with an article on professional liability insurance for family law attorneys.
You can read the article here.
Kingshuk Roy and Dustin Karrison obtained the dismissal of a lawsuit brought by a towing company seeking to recover towing costs from the owner of cargo onboard a tractor that wrecked on an Illinois highway. P&W argued that the plain language of the Illinois Vehicle Code did not include cargo owners, but only vehicle owners, operators, or other persons legally entitled to possession of the vehicle. The trial court agreed and dismissed the claim against the cargo owner with prejudice.
Tom Underwood, Mike Sanders, and R.J. VanSwol obtained the dismissal of a federal action alleging that a number of law firms and their clients had conspired with a state-court judge to violate the plaintiff’s due-process and equal-protection rights in an underlying wrongful-death case. After nearly fifteen years of litigation, the parties in the underlying case had reached a multimillion-dollar settlement, and the state-court judge made the rulings on dependency and allocation that were required for distribution of the settlement. The federal plaintiff, a potential beneficiary of the estate, disputed the state court’s jurisdiction over him and refused to participate in those proceedings. P&W moved to dismiss the federal plaintiff’s action because the Rooker–Feldman doctrine precludes parties from filing collateral attacks in federal court against state-court judgments. The U.S. District Court for the Northern District of Illinois dismissed the plaintiff’s claims, holding that the plaintiff’s remedies, if any, were in the state-court system.
Brad Purcell gave a presentation in Michigan on September 7 for an insurance client regarding changes in the Federal Rules of Evidence. Amendments to the rules that take effect on December 1, 2017, will make self-authentication of data copied from electronic devices easier. With a growing number of cases involving amateur cell phone video, surveillance video, and bodycam or dashcam video, it is important for attorneys and clients to be prepared for these changes.
Tom Underwood and R.J. VanSwol obtained summary judgment in favor of a general contractor’s insurer and against a subcontractor’s insurer in a declaratory action concerning allocation of an underlying construction injury settlement. The subcontractor’s insurer had argued that its policy language reduced the liability limits available to the general contractor as an additional insured and had claimed that the insurance requirements in the subcontract were ambiguous. The Cook County court rejected the arguments of the subcontractor’s insurer, holding that the subcontract imposed “a floor, not a ceiling” when calling for “not less than” a given amount of coverage. This judgment continues a recent streak of recovering over $15 million in judgments and settlements for insurers that have been forced to step in and protect their insureds when other carriers are reluctant to acknowledge coverage.
R.J. VanSwol obtained judgment on the pleadings in favor of a restaurant’s insurer on the grounds that it owed no coverage to a delivery driver in an underlying suit based on an auto accident with a pedestrian. The DuPage County court agreed with P&W’s arguments that the restaurant’s auto liability policy did not apply because the driver was not an insured under the policy while using a car that he or a member of his household owned, and that even if he had qualified as an insured under the restaurant’s general liability policy, the auto exclusion in that policy would have precluded coverage for the alleged accident.
Tom Underwood, Mike Sanders, and R.J. VanSwol obtained an appellate ruling in favor of an attorney who was alleged to have breached a fiduciary duty by representing his wife, who was also a lawyer, in a suit against the law firm she was leaving. The alleged successor to the firm and another partner claimed that P&W’s client had also represented the firm during its organization process. The trial court granted summary judgment to P&W’s client on the basis that the plaintiffs had not shown how his representation of his wife had proximately caused the plaintiffs damages, as any other attorney could have taken his wife’s case. The First District of the Illinois Appellate Court affirmed on the alternative ground, argued by P&W, that collateral estoppel precluded the plaintiffs’ argument that P&W’s client had ever had an attorney–client relationship with his wife’s former firm, and that the plaintiffs could not prevail on their claims because he had no duties to the firm. Depke v. Kitzinger, 2017 IL App (1st) 163336-U.
Defendants have long been wary of several counties in Illinois that have a reputation for plaintiff-friendly courts and juries. These venues include Cook County, home to Chicago and many of its suburbs, and Madison and St. Clair Counties, immediately across the Mississippi River from St. Louis. These three counties shared the dubious distinction of ranking #6 on the American Tort Reform Foundation’s 2016–17 Judicial Hellholes list.
But on September 21, 2017, the Illinois Supreme Court provided a new tool for out-of-state defendants seeking to avoid litigating cases in these counties (or any others in Illinois) where the facts of the litigation bear no relationship to the plaintiff’s chosen venue. In Aspen American Insurance Co. v. Interstate Warehousing, Inc., 2017 IL 121281, Aspen’s insured, Eastern Fish Company, stored fish products in Interstate’s refrigerated warehouse near Grand Rapids, Michigan. A portion of the warehouse roof collapsed, causing an ammonia leak that contaminated Eastern’s fish. Aspen paid Eastern for its lost fish and brought a subrogation suit against Interstate in Cook County, Illinois. Although Interstate had another warehouse in nearby Will County, Illinois, Interstate was incorporated and headquartered in Indiana.
The court explained the difference between specific personal jurisdiction, which exists when the plaintiff’s claims arise out of the defendant’s contacts with the forum state, and general personal jurisdiction, which can exist even if the defendant’s conduct at issue in the suit occurred entirely outside the forum state. Id. at ¶ 14. Aspen claimed that the Will County warehouse sufficed to subject Interstate to general personal jurisdiction in Illinois because it showed Interstate had “continuous and systematic” contacts with Illinois and was “doing business within” Illinois. But Interstate said the Will County warehouse did not establish that Interstate was “at home” in Illinois, citing the United States Supreme Court’s decision in Daimler AG v. Bauman, 134 S.Ct. 746 (2014).
The Illinois Supreme Court agreed with Interstate, reversing the denial of Interstate’s motion to dismiss. It noted that Interstate was “at home” in Indiana and did not have sufficient contacts to make it “essentially at home” in Illinois as well, or to make Illinois a “surrogate home.” As Daimler noted, “A corporation that operates in many places can scarcely be deemed at home in all of them.” Aspen at ¶ 19 (quoting Daimler, 134 S.Ct. at 762 n.20). The Illinois Supreme Court further held that under the Daimler test, the “doing business” section of the Illinois “long-arm” statute, 735 ILCS 5/2-209(b)(4), cannot constitutionally be applied to establish general jurisdiction where the defendant’s contacts have not rendered it “essentially at home” in Illinois. Aspen at ¶ 21. A corporation’s mere registration with the Illinois Secretary of State to transact business under 805 ILCS 5/13.05 or its maintenance of a registered agent in Illinois under § 5.05 likewise did not establish general personal jurisdiction. Id. at ¶¶ 23–27.
The United States Supreme Court has issued further decisions that confirm the Aspen court’s interpretation of Daimler, such as BNSF Railway Co. v. Tyrell, 137 S.Ct. 1549 (2017), holding that a Montana court could not exercise general jurisdiction over a railroad in a FELA suit based on injuries allegedly sustained outside Montana, and Bristol-Myers Squibb Co. v. Superior Court of California, San Francisco County, 137 S.Ct. 1773 (2017), holding that where a California court lacked general jurisdiction over the defendant, it also could not assert specific jurisdiction over nonresident plaintiffs’ products liability claims. The Aspen case indicates that such jurisdictional decisions may have lasting effects on plaintiffs’ attempts to take advantage of reputedly friendly venues with no real connection to the defendants or to the plaintiffs’ claims.