Articles Posted in Business Disputes

The First District Appellate Court of Illinois recently affirmed the entry of summary judgment against the plaintiff in a commercial breach of contract and mechanic’s lien dispute. In upholding the grant of summary judgment, the Court found that the plaintiff’s discovery responses doomed its mechanic’s lien claim, providing yet another example of why it is crucial for a party to carefully review its discovery responses – something the best commercial litigation attorneys make painstaking efforts to do.

The case stems from a dispute arising over an alleged verbal contract between the plaintiff, MEP Construction, LLC, and defendant, Truco MP, LLC, to build out the defendant’s restaurant. According to the plaintiff’s complaint, under the oral contract, it agreed to provide “construction management and other related services” to the defendant for a cost of $791,781.16 (though the parties later agreed to have the plaintiff do an additional $80,000.00 of work). The plaintiff further alleged that it “fully performed” its contractual obligations, but the defendant only made partial payment of $612,447.15 and refused to pay anything further. The plaintiff later recorded a mechanic’s lien naming the defendant and others and claiming an amount of $251,870.45 was owed to it.

In August 2017, the plaintiff filed a three-count complaint against the defendant alleging breach of contract and seeking to foreclose on the mechanic’s lien. In the course of discovery, the defendant issued a document request to the plaintiff asking for all documents showing all payments that the plaintiff had made for work performed either “by MEP or at the direction of MEP.” The plaintiff’s response to the document request stated that all “contractors, subcontractors and material were paid directly by Truco.” The defendant also sought production of all contracts between the plaintiff and “any and all contractors, sub-contractors or other persons with whom MEP contracted for purposes of performing work” at the property. The plaintiff responded to this request by stating that all contractors and subcontractors “contracted directly with Truco” and were paid directly by Truco. Continue reading ›

An electrical subcontractor sued the general contractor after the general contractor withheld $58,000. The general contractor claimed that it was owed a setoff for work performed by other electricians, but the trial court found that the money spent by the general contractor was not within the scope of the original agreement, and the electrical contractor had performed additional work and worked overtime to complete the project, despite delays caused by other contractors. The Illinois appellate court affirmed, finding that the trial court had not made a determination against the manifest weight of the evidence.

Hunter Construction Services entered into a general contract to construct a Buffalo Wild Wings restaurant in Dickinson, North Dakota. Hunter had built 14 similar stand-alone Buffalo Wild Wings prior to the North Dakota project. Hunter reached out to Mormat Electrical & Construction Services, LLC to be the electrical subcontractor on the project. Mormat had worked on other Buffalo Wild Wings projects and understood the general scope and labor requirements, even though the North Dakota project was larger than most. Mormat agreed, and Hunter and Mormat entered into an oral subcontract for electrical work. The electrical budget was $135,000, and Mormat was responsible for all the electrical labor and wiring over 120 volts, including the wiring and installation of all light fittings and fixtures as well as the equipment connections related to heating and cooling, kitchen appliances, and mechanical equipment. The scope of work necessitated a four to five man electrical crew.

Prior to entering into the contract, Mormat, a nonunion contractor, informed Hunter that it could not acquire a North Dakota electrical permit because it did not employ an electrician capable of being licensed in North Dakota. Hunter and Mormat agreed that a local contractor would need to be present on site to pull the necessary permits and perform inspections. Integrity Electrical was hired directly by Hunter on a time and material basis to provide the permit and supervision for the project. Continue reading ›

(July 28, Chicago) – DiTommaso Lubin, PC announced it has joined Nextlaw Referral Network, enabling it to connect its clients to high-quality lawyers around the world. Nextlaw Referral Network is the largest legal referral network in the world, with more than 650 member firms, 30,000 lawyers covering 200+ countries.

Peter Lubin of DiTommaso Lubin said, “By joining Nextlaw Referral Network, we can now provide our clients with the best of all worlds by continuing to serve them where we currently have offices, while also being able to direct them to top tier lawyers in other jurisdictions where they need legal counsel and business advice.  We can build on our trusted relationships with our clients by putting the full resources of the global, legal powerhouse at their disposal.”

Jeff Modisett, Nextlaw Referral Network CEO said, “We’re proud to have DiTommaso Lubin, PC as part of our network. We’re only as good as the quality of our member firms and DiTommaso Lubin makes us stronger and better able to meet the needs of our other members’ clients in the Chicago metropolitan area and Illinois.”

If you recently received money as part of a settlement or award for a lawsuit, have you thought about how that settlement or award will affect your taxes? Depending on the nature of your claim, you’ll probably have to pay taxes on that money, just like you would on any other form of income. Whether you’ve already received your award, or you’re thinking of settling a legal dispute, here’s what you need to know:

The Origin of the Claim

Not all awards come in the form of monetary payment. For example, if you sue your employer for loss of income, for whatever reason, then any award you receive will be taxed as wages. If, on the other hand, you bought a car that turned out to be defective and you sue the manufacturer, you might be able to treat any award you receive as a reduction in the price you paid for the car.

Physical Injuries and Illness vs. Emotional Distress

If you sue your employer for physical injuries sustained while on the job, or if you sue your doctor for medical malpractice, those awards are not subject to taxation. While you can also sue for “emotional distress” caused by the incident, any amount granted for that will be taxed. Continue reading ›

Worldwide, the impact of global change is being felt. While some people deny that climate change is even happening, the courts are, in fact, seeing the effects in the litigation scene. Suits concerning the issue are trending upwards. Jurisdictional restraints and distance are not stopping litigants from coming forward to file suit. Science, damages, and people being passionate about the cause have increased the number of people wanting to seek retribution, restraint or some form of way to mend harm done by being awarded damages and the cutting of carbon emissions. The biggest offenders? Large corporations. The Human Rights Commission in London is currently investigating the catastrophic effects of Typhoon Yolanda which affected those in the Philippines. The nexus between the polluting corporations with the effects on the environment is what will need to be established and whether the condition was exacerbated as a result of that pollution. The difficulty in being able to produce evidence to present this case and the distance of greater than six thousand miles is no bar.

One possible reason for the increase in lawsuits is the lack of response from governance. People are also more environmentally conscious and know of the impacts of gas emissions
when it comes to health, land and air quality. Successful litigation in this realm has not been as successful as environmentalists would like. However, the pendulum is shifting. Public
awareness and better-equipped machines with techniques to track results also tie in with that. A worldwide consensus is now there when it comes to damage. It is proving that a single
corporation is responsible and to what degree used to be more difficult than it is now. We also know that from a few prior posts on our blog, those actions have started in the USA
also. We discussed this when we looked at a suburban business in Chicago that is under scrutiny for implementation of a system in which the way they sterilized caused emissions of
a cancer-causing substance. The operational facility provided sterilization services to the medical, pharmaceutical and food industries. Ironically, the health damage by its emissions made locals
worse off. Continue reading ›

After a surgery went horribly awry at a private surgical center, and the center was sued by the patient, it could not recover the full amount of judgment against it from its insurer an appellate court found. The court found that the surgery center had urged its insurer, who was defending it in the patient’s lawsuit, not to settle, as it believed its case to be highly defensible. Because of this, the panel found that the insurer had behaved appropriately even though it eventually lost and the jury awarded damages that were more than quintuple the surgical center’s policy limit.

Surgery Center at 900 North Michigan Avenue, LLC is an outpatient surgical center that permits outside physicians to perform day surgery at its facility. American Physicians Assurance Corporation, Inc. is a medical malpractice insurance company that insured Surgery Center. The insurance policy that Surgery Center purchased from APA limited APA’s liability to $1 million per claim and provided that APA would defend and indemnify Surgery Center for claims that fell within the policy’s coverage. Continue reading ›

A class action lawsuit recently filed in a federal court in Washington accuses Getty Images, Inc. (“Getty”) of allegedly duping customers into paying for fictitious copyright licenses for images in the public domain that can be used freely.

The plaintiff in the case, Texas digital marketing company CixxFive Concepts LLC, claims that it was one of the victim’s of Getty’s wrongful conduct and alleges that Getty’s actions violated the RICO Act and state consumer protection laws. The wrongful conduct, according to the complaint, was not merely charging for the public domain images but rather deceiving customers into believing they needed to buy licenses for access to those images and purporting to restrict the use of those public domain images. The complaint concedes that “charging for public domain images is not illegal by itself,” but goes on to allege that “Getty’s and/or Getty US’s conduct goes much further than this… Using a number of different deceptive techniques, Getty and/or Getty US misleads its customers and potential customers into believing that it or one of its third-party contributors owns the copyright to all of the images available on its website, and that a license from Getty and/or Getty US is required to use all of the images on its website [when] [i]n truth, anyone is free to use public domain images, without restriction, and by definition in a non-exclusive manner, without paying Getty and/or Getty US or anyone else a penny.”

The complaint goes on to allege that “Getty and/or Getty US purport to restrict the use of the public domain images to a limited time, place, and/or purpose, and purport to guarantee exclusivity in the use of public domain images,” and that Getty’s license agreement currently “prohibits the use of licensed public domain works in on-demand products, such as ‘postcards, mugs, t-shirts, calendars, posters, screensavers or wallpapers,’ or in electronic templates, such as ‘website templates, business card templates, electronic greeting card templates, and brochure design templates.’” This conduct, the complaint alleges “deceptively purports to restrict the licensee’s preexisting right to free and unfettered use of public domain images.”

To add insult to injury, the complaint also alleges that Getty (through a company License Compliance Services, Inc. (“LCS”) which the complaint alleges Getty owns or controls) regularly sends copyright infringement letters to businesses using public domain images online “accusing them of infringing copyrights in public domain images.” The complaint gives an example alleging that “LCS sent a letter to Carol Highsmith, the noted American photographer who has donated tens of thousands of images to the Library of Congress, accusing her nonprofit foundation of copyright infringement for using one of her own public domain images.”

The lawsuit seeks to represent all licensees who have paid Getty for public domain images and seeks to recover treble damages, costs and attorney’s fees as well as an injunctive relief preventing Getty from “wielding a false claim of ownership of over intellectual property that is rightfully in the public domain.”

A copy of the complaint against Getty can be obtained here. Continue reading ›