Robert William Gettleman

In this case, twenty foreign individuals and corporations who held futures trading accounts with defendant Alaron Trading Corporation alleged that Alaron, its Miami branch, and three Florida-based employees operated a Ponzi scheme with a Guatemalan introducing broker that defrauded plaintiffs of at least $11 million between 2005 and 2008, in violation of the Commodity Exchange Act and various state laws including fraud and breach of fiduciary duty. The defendants moved to dismiss the second amended complaint under Federal Rules of Civil Procedure 12(b)(6), 8, 9(b), and related provisions, arguing insufficient particularity in the fraud allegations. The court denied the motions to dismiss filed by Alaron, Tarafa, and Alvarez in full, and denied Ortega’s motion except as to Counts III and X, which were dismissed with prejudice as to him. The core reasoning was that the second amended complaint remedied prior deficiencies by providing specific details such as account numbers, dates, and individual defendants’ roles in meetings and guarantees, thereby satisfying Rule 9(b)’s heightened pleading standards and stating plausible claims.

business & regulatoryproceduretorts & liability

Plaintiff Albert Palacz, a former police officer and K-9 handler for the Village of Harwood Heights, sued the Village after his termination, bringing claims under Title VII for sex and disability discrimination and retaliation, the Fair Labor Standards Act for unpaid overtime, breach of a K-9 contract, and the Illinois Whistleblower Act for providing an affidavit in a related state-court lawsuit about the unauthorized spaying of the police dog. Defendant moved to dismiss only the whistleblower count under Rule 12(b)(6), arguing that the complaint failed to allege that Palacz reasonably believed the spaying violated a state or federal law rather than just a contract, and that the affidavit was not disclosed "in a court." The court denied the motion, concluding that the facts alleged permitted a plausible inference of reasonable belief in a legal violation and that supplying the affidavit for use in the lawsuit satisfied the Act's disclosure requirement via its catch-all "or in any other proceeding" language.

labor & employmentprocedure

The case involved twenty foreign plaintiffs suing Alaron Trading Corporation, its Miami branch, and three Florida-based employees for allegedly participating in a futures and options Ponzi scheme with a Guatemalan introducing broker from 2005 to 2008, asserting four counts under the Commodity Exchange Act plus state-law claims for fraud, breach of fiduciary duty, and unjust enrichment. Defendants moved to dismiss under Rule 12(b)(6) for failure to state a claim, with one defendant also seeking dismissal under Rules 12(b)(2) and (b)(3) for lack of personal jurisdiction and improper venue. The court denied in part and granted in part the 12(b)(6) motion and denied the jurisdictional and venue motion, holding that the complaint sufficiently alleged knowing participation in deceptive practices, excessive trading, and concealment of losses to support several CEA and state claims while dismissing others, and that the CEA provided a basis for jurisdiction over the out-of-state defendant.

business & regulatoryprocedure

In this case, plaintiff Clausen Miller, P.C. sued defendant Citibank, N.A. under 810 ILCS 5/4-302, alleging that Citibank failed to timely return or provide notice of dishonor for a $372,640 counterfeit check that the plaintiff had deposited, making the bank accountable for the amount. The parties filed cross-motions for summary judgment after establishing undisputed facts about the check's receipt on July 16, 2008, and its handling. The court denied the plaintiff's motion and granted the defendant's, ruling that Citibank complied with the statute by dispatching the physical check to the Federal Reserve Bank of Philadelphia via courier before midnight on July 17, 2008, and sending electronic notice the same day, as returning banks like the Fed qualify under the UCC rule requiring action by the midnight deadline. The decision turned on the legal definition of a timely 'return' for purposes of the banking provision, with no genuine issues of material fact remaining.

business & regulatoryprocedure

In Turek v. General Mills, Inc., plaintiff Carolyn Turek sued General Mills and Kellogg under the Illinois Consumer Fraud and Deceptive Practices Act, alleging that the companies' marketing of products like Fiber One bars and yogurt failed to disclose the presence of non-natural fiber (inulin from chicory root extract) and that current science did not show it provided the same health benefits as natural fiber. Defendants moved to dismiss for lack of subject-matter jurisdiction, arguing the claims were preempted by the federal Nutrition Labeling and Education Act (NLEA). The court granted the motion, holding that the NLEA expressly preempts state-law requirements that are not identical to its food-labeling rules, which permit inulin to be labeled simply as fiber without additional disclosures about its type or relative benefits. The court reasoned that the plaintiff's proposed labeling mandates would impose non-identical obligations on manufacturers and that the NLEA's strong preemptive language overcame the usual presumption against preemption in areas of traditional state regulation like food labeling.

business & regulatoryfederal power

Freedom Mortgage Corporation sued Burnham Mortgage, Exeter Title Company, Ticor Title Insurance Company, attorney John Jeffrey Hlava, and others, alleging a mortgage fraud scheme involving nine properties and asserting claims including fraud, negligent misrepresentation, civil RICO, breach of fiduciary duty, negligence, and civil conspiracy. Hlava and Exeter moved to dismiss the claims against them, while Ticor moved to dismiss all claims except breach of contract and for partial summary judgment regarding three properties. The court granted Hlava’s and Exeter’s motions as to the civil RICO counts but denied them as to the remaining claims; granted Ticor’s motion to dismiss the listed claims against it; granted Ticor’s partial summary judgment motion; and struck requests for attorney’s fees and prejudgment interest from certain counts. These rulings were based on pleading sufficiency under Federal Rules of Civil Procedure 12(b)(6) and 9(b), the economic loss doctrine, the elements required for RICO and fiduciary duty claims, and prior district court and Seventh Circuit decisions on the scope of the action.

business & regulatoryproceduretorts & liability

In Federal Trade Commission v. Trudeau, the FTC sought sanctions after the defendant was found in contempt of a 2004 consent order that settled an earlier contempt finding and barred deceptive infomercial advertising for books and publications. Following remand from the Seventh Circuit, the district court addressed the FTC's renewed motions for a compensatory monetary remedy and to modify the injunction. The court granted the motions in part, imposing a sanction of roughly $37.6 million measured by consumer losses from sales induced by the deceptive infomercials for the Weight Loss Cure book and modifying the injunctive relief. The court reasoned that consumer loss was an appropriate measure of civil contempt sanctions given the difficulty of calculating Trudeau's profits due to his conduct, the pattern of contemptuous behavior, and the broad discretion courts have to fashion remedies that deter future violations.

business & regulatoryprocedure

This case involved a lender suing three defendants to enforce their personal guaranties on a defaulted $34.8 million loan made to a real estate partnership for property acquisition in Texas. The plaintiff sought summary judgment on claims for breach of a limited joinder agreement and breach of guaranty under Illinois law. The court granted the motion, finding no genuine dispute of material fact because the defendants did not contest the loan default, their execution of the guaranties, or the lender's performance, and their affirmative defenses were unsupported or barred. The court deemed the motion to strike the defenses moot as a result.

business & regulatory

This case is an appeal from a bankruptcy court judgment in an adversary proceeding brought by the Chapter 7 Trustee of CMGT, Inc., against Spehar Capital, LLC, to determine the validity and priority of Spehar's claimed lien on estate assets arising from a domesticated California judgment and citations to discover assets. Spehar had entered a post-petition financing agreement with the Trustee to fund litigation, which the bankruptcy court approved in a Financing Order that recognized Spehar's lien; Spehar later counterclaimed for breach when the Trustee sought to void related liens. After a bench trial, the bankruptcy court ruled for the Trustee on all claims and denied Spehar relief from the judgment under Rule 60(b). On appeal, the district court held that the bankruptcy court lacked authority to entertain the adversary proceeding because doing so effectively vacated the prior Financing Order without proper grounds under Rule 60(b), and therefore vacated the judgment and remanded for further proceedings.

business & regulatoryprocedure

This case was a class action securities fraud lawsuit brought by shareholders against Sears Roebuck & Co., its CEO, and ESL Partners and its controlling person, alleging violations of §§ 10(b) and 20(a) of the Exchange Act and Rule 10b-5 by failing to disclose merger negotiations between Sears and Kmart and by ESL's failure to timely file a Schedule 13D. After denying a motion to dismiss and certifying a class of investors and options traders, the court granted the defendants' motions for summary judgment after striking the plaintiffs' Local Rule 56.1 responses for noncompliance. The core reasoning was that undisputed facts showed no ongoing merger negotiations during the class period that would trigger disclosure duties, the originally discussed deal would not have required a new filing, and any ESL involvement occurred after the class period began with timely filing once required.

business & regulatory

The case involves a dispute between Majestic Star Casino, which sponsored self-funded employee health benefit plans, and its stop-loss insurer Trustmark over reimbursement for claims exceeding $100,000 per participant. Majestic asserted claims for declaratory judgment, breach of contract, unfair claims practices, bad faith, and breach of fiduciary duty arising from denied payments tied to an alleged 80% employee participation requirement and COBRA notice timing for employees on leave; Trustmark filed counterclaims seeking rescission for misrepresentation. The court addressed cross-motions for partial summary judgment, granting them in part and denying them in part after examining the insurance contracts, applications, and related documents under Nevada state law to determine what terms formed the entire agreement and whether policy conditions were satisfied.

business & regulatoryhealthcarelabor & employmentprocedure

This case involves a qui tam action under the False Claims Act in which relator Dimitri Yannacopoulos alleged that General Dynamics and Lockheed Martin submitted false claims and statements to the Defense Security Assistance Agency in connection with a contract to sell F-16 aircraft to Greece, including claims related to excess payments, debt maintenance, co-production, electronic measures work, spare parts, and failure to disclose contract modifications such as elimination of an Economic Price Adjustment Clause. The court had previously denied a motion to dismiss and granted partial summary judgment on some theories, including implied certification claims. On the renewed motions for summary judgment, the court granted judgment to both defendants on all remaining claims, finding that the relator failed to show any false claims or statements, that the EPA Clause was properly eliminated by agreement after negotiations and would not have affected invoice payments in any event, and that no violations of the certifications or DSAA requirements occurred.

criminal lawbusiness & regulatory

This case arose from failed business dealings involving software licensing and a dealer agreement between Facility Wizard Software, Inc. (FWS), Southeastern Technical Services, LLC d/b/a CPSS, and intervening plaintiff The CharlotteMecklenburg Hospital Authority (CMHA), leading to claims and counterclaims for breach of contract, trade secret misappropriation under Illinois and North Carolina statutes, deceptive trade practices, and unfair competition. The court granted CPSS's motion to dismiss FWS's North Carolina-based claims (Counts III-V) because the underlying contracts contained an Illinois choice-of-law provision. The court denied FWS's motion to dismiss CPSS's counterclaims for breach of contract and rescission, as well as CMHA's motion to dismiss FWS's breach-of-contract counterclaim, finding that the allegations satisfied federal pleading standards under Rule 8 and that contract ambiguities could not be resolved on a motion to dismiss. The rulings rested on application of the choice-of-law clause, sufficiency of notice pleading, and the principle that factual disputes over contract interpretation are inappropriate for resolution at this stage.

business & regulatoryprocedure

The case involved Daniel Isaacson suing SABA Commercial Services Corporation for violating the Fair Debt Collection Practices Act and related state law claims after SABA attempted to collect a debt from the rental of an RV that was towed and sold. The court granted summary judgment to the defendant on the FDCPA claim, finding that the debt arose from a business transaction on behalf of a non-profit organization rather than a personal, family, or household purpose, which is required for FDCPA protection. The court declined to exercise supplemental jurisdiction over the remaining state law claims and dismissed them without prejudice.

business & regulatoryprocedure

This case involves a class action lawsuit by shareholders of Inland REIT against the company, its advisors, directors, and related entities, alleging that a 2007 proxy statement contained material misrepresentations and omissions to secure approval of a $375 million internalization transaction acquiring affiliated management companies in a self-dealing deal. The court addressed motions to dismiss claims under Sections 14(a) and 20(a) of the Securities Exchange Act, as well as state-law claims for breach of fiduciary duty, aiding and abetting, and related counts. It granted dismissal of Count I in part (as to two specific proxy issues), denied it as to the remaining issues, denied dismissal of Count II, and dismissed Counts III through VII in full. The core reasoning for dismissing the fiduciary duty claims was that they asserted injuries to the corporation rather than distinct shareholder injuries, making them derivative actions requiring demand under Maryland law, while certain proxy claims failed to meet pleading standards under the PSLRA but others sufficiently alleged negligence or material misstatements.

business & regulatoryprocedure

The case is a putative class action securities lawsuit brought by lead plaintiffs against Ulta Salon, Cosmetics & Fragrance, Inc., its CEO Lynelle Kirby, and its CFO Gregg Bodnar, alleging that the company's October 2007 IPO registration statement and prospectus contained material misrepresentations and omissions about rising SG&A expenses, sharply increased inventory levels contrary to historical trends, and problems with a new warehouse management software system. These claims were brought under §§ 11, 12(a)(2), and 15 of the Securities Act of 1933 and §§ 10(b) and 20(a) of the Securities Exchange Act of 1934, along with Rule 10b-5. The court denied the defendants' motion to dismiss all counts under Fed. R. Civ. P. 12(b)(6). The core reasoning was that plaintiffs adequately alleged material misrepresentations or omissions (with no scienter required for the Securities Act claims), and for the Exchange Act claims, the complaint pleaded particularized facts creating a strong inference of scienter based on defendants' access to internal information about the off-trend expenses, inventory buildup, and software issues.

business & regulatory

This case challenged the constitutionality of the Illinois Silent Reflection and Student Prayer Act, which requires public school teachers to observe a daily period of silence for reflection or prayer at the start of each school day, along with provisions allowing voluntary student-initiated prayer. The court granted the plaintiffs' motion for summary judgment and denied the defendants', holding the statute unconstitutional under the Establishment Clause of the First Amendment as applied to the states. Applying the Lemon test, the court determined that the law lacked a sincere secular purpose, as its legislative history and the shift from permissive to mandatory language revealed an intent to advance religion, while its implementation in the coercive school environment risked endorsing religious observance. The decision also addressed related claims of vagueness but focused primarily on the Establishment Clause violation.

religious libertyfree speechcivil rights

The case concerned plaintiff Thomas Davis's claim that defendants orchestrated a fraudulent scheme to induce him to sign documents he believed would refinance his home mortgage but instead conveyed title to a third party, with Count III seeking to construe the transfer as an equitable mortgage rather than an outright sale. Defendant NovaStar asserted affirmative defenses including that it and a related party were bona fide purchasers for value, as well as waiver and estoppel. The court granted partial summary judgment to the plaintiff on NovaStar's first and second affirmative defenses and granted the motion to strike the third and fourth defenses. The core reasoning was that the waiver and estoppel defenses were inadequately pleaded under Federal Rules of Civil Procedure 8 because they failed to identify specific conduct satisfying the elements of those defenses or to allege detrimental reliance for estoppel, leaving the court to speculate as to their basis.

propertyprocedure

In Frye v. L'Oreal USA, Inc., a plaintiff brought a putative class action against the cosmetics manufacturer alleging that certain lipstick products contained unsafe levels of lead, in violation of the Illinois Consumer Fraud and Deceptive Practices Act, implied warranties under state and federal law, strict liability, negligence per se, and unjust enrichment. The court granted the defendant's motion to dismiss the complaint in its entirety under Rule 12(b)(6). The core reasoning was that the plaintiff failed to allege any actual, concrete damages or injury, as required for each claim: she did not show pecuniary loss under the benefit-of-the-bargain rule, contractual privity for warranty claims, or personal harm sufficient for tort-based recovery, rendering the allegations speculative and insufficient under Twombly and Rule 9(b).

business & regulatoryproceduretorts & liability

In Portis v. City of Chicago, a class of plaintiffs sued the City alleging that its practice of detaining individuals arrested for non-jailable ordinance violations (punishable only by fine) for more than two hours after all administrative steps to determine their eligibility for release on an individual recognizance bond had been completed violated their Fourth Amendment rights. The court certified a class limited to those arrested from May 2000 through September 2004 who were not fingerprinted and were eligible for prompt release under Illinois Supreme Court Rule 553(d). Plaintiffs moved for summary judgment on liability, and after resolving factual disputes about the sequence of administrative steps, the court granted the motion. The court reasoned that once eligibility for release was established (at latest upon issuance of a Central Booking number), any further detention beyond the minimal time needed for non-discretionary ministerial acts was unreasonable under the Fourth Amendment.

criminal lawcivil rights