Chicago Business Litigation Lawyer Blog

Plaintiff in Class Action Bears the Burden of Proving Case Belongs in State Court 7th Circuit Rules

November 11, 2014 | Peter S. Lubin and James V. DiTommaso

Under the Class Action Fairness Act (CAFA), defendants in a class action lawsuit are able to have the case moved to federal court. This law was enacted to prevent plaintiffs from “forum shopping”, or filing their lawsuit in the court that they knew would be most favorable to their side. There are limits to the law though. If the claims of a class action lawsuit amount to less than $5 million, or if at least two thirds of the class members are residents of one state, then the lawsuit can proceed in a district court of that state.

According to a recent ruling by the Seventh Circuit Court of Appeals, the plaintiff bears the burden of providing evidence that allows the court to determine the citizenship of the putative class members as of the date that the case was removed to federal court. The ruling came out of a class action lawsuit that was filed against an Illinois insurance company for allegedly violating relevant state laws when it pulled out of the market in 2002 and cancelled all of its policies. The defendants had the case removed to federal court, but the plaintiffs argued that it belonged in Illinois state courts under the home-state exemption.

The plaintiffs argue that the lawsuit belongs in Illinois state court based on the fact that the defendants’ policy was offered only to people who represented that they lived in Illinois or, for group policies, to employers who represented that most of their beneficiaries lived in Illinois. The plaintiffs assert that, assuming that former policyholders left Illinois at the normal rate of 2% per year since 2002, about 87% of the putative class members were Illinois residents when the case was removed to federal court. Continue reading ›

Consumer Fraud Claims Brought as Class Action Against Templeton Rye in Chicago

November 3, 2014 | Peter S. Lubin and James V. DiTommaso

Companies know the importance of advertising. Many people are attracted by a particular label or claims that a product is associated with a certain time in history or perceived social standing. This is especially true of alcohol where, aside from the taste, many people make their purchasing decisions based on a sense of prestige. Breweries and distilleries often try to given their brand a pretigious image and use that image in their advertising, including the producers of Templeton Rye Whiskey.

According to a recent class action lawsuit against the company, Templeton Rye allegedly violated consumer protection laws by allegedly misleading consumers with stories of the whiskey’s origins. Marketing material released by the company claims that its founders were inspired by the Prohibition-era recipe of Alphonse Kerkhoff, which was handed down through his family on a scrap of paper. The label on the whiskey bottle also bears an old black-and-white photo, which is reminiscent of America in the 1920s when Prohibition was in effect. The label matches the whiskey maker’s claims to a recipe that has been handed down through the generations, and reinforces the belief that the whiskey is made using a recipe that is almost 100 years old. Continue reading ›

DiTommaso Lubin’s Oak Brook and Chicago Attorneys Patrick Austermuehle and Andrew Murphy Named 2015 Illinois Super Lawyers/Rising Stars as Class-Action, Business Litigation and Consumer Rights Attorneys

October 31, 2014 | Peter S. Lubin and James V. DiTommaso

Super Lawyers named Chicago and Oak Brook business trial attorneys Patrick Austermuehle and Andrew Murphy Super Lawyers/Rising Stars in the Categories of Class Action, Business Litigation, and Consumer Rights Litigation. DiTommaso Lubin’s Oak Brook and Chicago business litigation lawyers have over a quarter of a century of experience in litigating complex class action, consumer rights, and business and commercial litigation disputes. We handle emergency business lawsuits involving injunctions, and TROS, covenant not to compete, franchise, distributor and dealer wrongful termination and trade secret lawsuits and many different kinds of business disputes involving shareholders, partnerships, closely held businesses and employee breaches of fiduciary duty. We also assist businesses and business owners who are victims of fraud.

Peter S. Lubin

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DiTommaso Lubin’s Oak Brook and Chicago Attorney Peter Lubin Named 2015 Illinois Super Lawyers as Class-Action, Business Litigation and Consumer Rights Attorney

October 30, 2014 | Peter S. Lubin and James V. DiTommaso

Super Lawyers named Chicago and Oak Brook business trial attorney Peter Lubin a Super Lawyer in the Categories of Class Action, Business Litigation and Consumer Rights Litigation. DiTommaso Lubin’s Oak Brook and Chicago business trial lawyers have over a quarter of century of experience in litigating complex class action, consumer rights and business and commercial litigation disputes. We handle emergency business law suits involving injunctions, and TROS, covenant not to compete, franchise, distributor and dealer wrongful termination and trade secret lawsuits and many different kinds of business disputes involving shareholders, partnerships, closely held businesses and employee breaches of fiduciary duty. We also assist businesses and business owners who are victims of fraud.

Peter S. Lubin

online at

Wage Theft on the Rise — Our Chicago Class Action Lawyers Sue for Unpaid Overtime

October 29, 2014 | Peter S. Lubin and James V. DiTommaso

The courts of the United States have seen an exponential rise in the number of wage and hour lawsuits that get filed every year, but the cause of this rise is unclear. Worker advocates allege that “wage theft” has become far too prevalent in our nation’s current economy. Many blame the recent recession, which pressured employers to cut corners in order to save costs. At the same time, employees were afraid of losing their jobs and being unable to find new employment. The result was that employers took advantage of the situation to get more work out of their employees while paying them less. It is only since the job market started to stabilize that employees have felt confident enough to file lawsuits against their employers.

Business advocates tell a different story. They assert that government officials are creating large numbers of wage and hour lawsuits, mostly so they can score points with the unions. They point to the fact that the recent wage and hour lawsuit against Schneider Logistics coincided with unions pressuring Walmart to raise wages. Although Schneider does store merchandise for Walmart, it is not owned by Walmart, and Walmart is not responsible for Schneider’s employment practices. Despite this fact, the lawyers and labor groups involved in the lawsuit against Schneider have sought to make Walmart jointly liable in the labor violations.

Business groups also claim that the onslaught of wage and hour lawsuits against McDonald’s has been coordinated with the recent movement by fast-food workers demanding a $15 minimum wage. Continue reading ›

Walgreens’s Former CFO Files Defamation Suit in Chicago — Our Chicago Defamation, Libel and Slander Attorneys Handle Similar Claims

October 26, 2014 | Peter S. Lubin and James V. DiTommaso

No one likes being the scapegoat in a messy situation. Unfortunately, when large companies lose a lot of money, or don’t make as much as they had anticipated, their first recourse is often to find someone to blame. In the case of Walgreens’s recent $1 billion alleged forecasting error, the company’s CFO at the time, Wade Miquelon, became the alleged scapegoat.

According to reports, Miquelon made an alleged forecasting error that required Walgreens to cut its forecast of pharmacy unit earnings for the year 2016 from $8.5 billion down to $7.4 billion. After the alleged forecasting error, Miquelon and another executive at Walgreens lost their jobs, but Miquelon tells a different alleged story which Walgreens denies.

According to the former CFO, he was not fired from his position. In fact, he claims he was offered a promotion and told that, if he accepted it, he would be in line to succeed Gregory Wasson as Walgreens’s CEO. Instead of taking that opportunity, Miquelon says he left his position “to pursue opportunities outside of Walgreens”. Thanks to accusations made by Wasson and other Walgreens executives though, Miquelon’s opportunities outside of Walgreens have allegedly been severely restricted. Continue reading ›

Missouri Appeals Court Holds that Employee Who Quits Rather Than Sign a Non-Compete Agreement Can Collect Unemployment

October 25, 2014 | Peter S. Lubin and James V. DiTommaso

Unemployment benefits were designed to help those who lose their job through no fault of their own. As a result, most employers don’t expect former workers who resign their position to receive unemployment benefits, but a Missouri appellate court recently ruled that, in some instances, an employee who resigns can do just that.

The case that prompted the ruling was David Darr, a former life-insurance salesperson for Robertsville Marketing Group, based in Wentzville, MO. A few months after Darr began working for Robertsville, the company sent out a notice to all of the employees, telling them they would be required to sign a non-compete agreement as a condition of continued employment with the company. Continue reading ›

Some Courts Come up With Restrictions to Block Class Actions

October 21, 2014 | Peter S. Lubin and James V. DiTommaso

When a consumer feels she has been cheated by someone she bought a product or service from, the amount of her claim is often too small to warrant suing the seller. In that case, the consumer’s best bet is to collect a group of other consumers who have similarly been allegedly cheated and file a class action lawsuit. In order to successfully pursue a class action lawsuit though, a judge must grant the plaintiffs class action status, and in order for the judge to do that, the class of plaintiffs must fulfill certain requirements. These requirements include a class that is sufficiently large to warrant a class action, plaintiffs who can adequately represent the class, and complaints from class members that are sufficiently similar to warrant combining them into one action.

Another requirement that has caused much controversy in the courts lately is ascertainability, meaning there must be a way to identify all of the members of the class. This can be an issue in class actions filed against food producers or retailers, especially those who produce cheap food, for which consumers rarely keep their receipts. In Carrera v. Bayer, the plaintiff, Gabriel Carrera, sued Bayer on behalf of all consumers who had purchased Bayer’s One-A-Day WeightSmart diet supplement. According to the complaint, Bayer falsely advertised its diet supplement as having metabolism-boosting effects, based on the fact that it contained green tea extract. Continue reading ›

Mass Mutual Agrees to Pay $1.6 Million SEC Fine and Whistleblower Receives $400,000 of the $1.6 Million Fine

October 20, 2014 | Peter S. Lubin and James V. DiTommaso

A lot of people lost money in the recent economic downturn. Stocks plummeted, 401K accounts shrank overnight, and for most people, there was nothing that could have been done to prevent it. In some instances, though, an investor’s loss was a direct result of negligence or fraud on the part of the company that was supposed to be protecting their money.

According to the Securities and Exchange Commission (S.E.C.) that is exactly what allegedly happened to investors who trusted their money to MassMutual Financial Group, an insurance company based in Springfield, Massachusetts. Bill Lloyd worked for MassMutual for 22 years and allegedly had a reputation for being a straight arrow. Unlike the stereotypical agent who is interested only in making money for himself, Lloyd truly cared about his customers. As a result, when he encountered a situation in which his customers were allegedly getting ripped off, Lloyd could not let it slide.

In 2007, when money was gushing into variable annuities, MassMutual added two income guarantees: Guaranteed Income Benefit Plus 6 and Guaranteed Income Benefit Plus 5. The idea behind these products was that they would guarantee that the annuity income stream would grow to a predetermined cap regardless of how the investment itself performed.

When the investors retired, they could take six percent (or five percent, depending on which product they bought) of the cap for as long as they wanted or until it ran out of money, and still be able to annuitize it at some point. In theory, the money would never run out, and that is how agents like Lloyd were allegedly told to sell the product to customers. Before long, investors had put $2.5 billion into these products.

In 2008 it allegedly became evident that the products did not work they way customers had been told they would work. As a result of the market’s fall, it was according to Lloyd all but certain that thousands of customers were going to run through their income stream within seven or eight years of withdrawing the money. Continue reading ›

Big Companies are Allegedly Requiring Some Hourly Workers to Sign Non-Compete Agreements — Our Chicago Non-Compete Agreement Attorneys Prosecute and Defend Covenant Not to Compete Lawsuits

October 17, 2014 | Peter S. Lubin and James V. DiTommaso

Non-compete agreements have been in use in the top tiers of American companies for several years now. The idea is to protect the interests of the company by making sure that executives or other employees with trade secrets and confidential information don’t take those secrets to a competitor, where they can be used against the company. Non-compete agreements began in the big tech companies, where keeping the company’s latest developments was of the utmost importance in order for the company to be able to effectively compete in the marketplace.

Non-compete agreements impose restrictions on when and where an employee can work after leaving the company. Usually, the employee cannot go to work for a direct competitor within a certain reasonable geographical radius of the company and within a certain reasonable time frame after leaving the company. This means that an employee is generally allowed to go work for a company’s competitor, only if the competitor is located in a different city or state from the company. Often, employees can work for whomever they want wherever they want within six months to a year after leaving the company. The lag time is usually sufficient to render useless any trade secrets the employee might have.

For executives or employees who are working with trade secrets, helping to develop new products for the company, etc., it may makes sense that the company would want to protect their investment by preventing those employees from going to work for a competitor. It does not make sense for companies to require hourly employees making sandwiches to sign a non-compete agreement, yet that is allegedly the case for certain Jimmy John’s employees.

It is hard to believe that the people making sandwiches, on the bottom rung of the proverbial ladder, have any valuable trade secrets that Jimmy John’s would not want shared. Other cases of hourly, minimum-wage employees have been reported, but it is rare for a company to enforce the non-compete agreements of these employees. Jimmy John’s, on the other hand, according to the New York Times has allegedly taken steps to actively restrict the alternate employment options of its sandwich makers. The Time’s blog does say that there is no reported case of Jimmy John’s actually seeking to enforce this provision.