On May 10, 2019, the Illinois Appellate Court, First District, reversed the trial court's dismissal of an employer's two-count complaint for breach of fiduciary duty and tortious interference with prospective economic advantage. Advantage Marketing Group, Inc. v. Keane, 2019 IL App (1st) 181126 (First District May 10, 2019). The First District held that the employer's complaint stated causes of action against the employee for breach of fiduciary duty and tortious interference, even though the employee was not an officer or director of the company. The employer alleged that the employee breached his fiduciary duty to the employer when he allegedly failed to disclose and misappropriated a corporate opportunity to purchase a competing business. Under Illinois law, an employee owes fiduciary duties to his or her employer, which arise from the employment relationship. These include the duties of loyalty and fidelity as well as the duty to avoid self-dealing at the expense of the employer.
Employment Law Chicago Blog
On May 8, 2019, the 7th Circuit affirmed an order of summary judgment in favor of a hospital on Title VII employment discrimination claims brought by a physician whose practice privileges were terminated by the hospital. Levitin v. Northwest Community Hospital, No. 16-3774 (7th Cir. May 8, 2019). The physician sued the hospital, alleging that it terminated her hospital practice privileges on the basis of her sex, religion, and ethnicity, in violation of Title VII of the Civil Rights Act of 1964 ("Title VII"). The hospital argued that the physician was not an employee of the hospital and, therefore, her Title VII discrimination claims were precluded. The district court found that she was an independent physician with practice privileges at the hospital, not the hospital's employee.
On April 2, 2019, the Illinois Appellate Court, Second District, reversed the trial court's order of summary judgment in favor of the defendant-employer in an employment discrimination lawsuit under the Illinois Human Rights Act ("IHRA"), in which the plaintiff-employee claimed that her employer unlawfully discriminated against her because of her sex, race, national origin, and age, and unlawfully retaliated against her for complaining about it. Lau v. Abbott Laboratories, 2019 IL App (2d) 180456 (Second Dist. April 2, 2019). The IHRA is an Illinois anti-discrimination statute that contains the same employee protections as the federal anti-discrimination statutes (as well as some additional protected classifications that are not covered by the federal laws). Illinois courts interpreting the IHRA are guided by federal case law interpreting the federal anti-discrimination laws. The same legal standards and proof paradigms apply.
On March 29, 2019, the Illinois Appellate Court, First District, upheld the rule that continued employment for less than two years does not constitute adequate consideration to support noncompetition or nonsolicitation provisions contained in Illinois at-will employment contracts. Axion RMS, Ltd. v. Booth, 2019 IL App (1st) 180724 (First Dist. March 29, 2019). This is the so-called "two-year rule," established by the Illinois Appellate Court, First District, in its decision in Fifield v. Premier Dealer Services, Inc., 2013 IL App (1st) 120327, which remains fluid and controversial, because the Illinois Supreme Court has not decided the issue. Consequently, federal district court judges may, but are not required to follow the "two-year" rule when determining the enforceability of noncompetition or nonsolicitation agreements under Illinois law. Federal judges in the U.S. District Court for the Northern District of Illinois have split on the issue--some follow the bright-line "two-year rule," while others determine the enforceability of employment restrictive covenants based upon the totality of the circumstances.
On March 11, 2019, the Illinois Appellate Court, First District, held that under Illinois law, a successor business entity may be liable for an employment discrimination claim against an employer that transferred its assets to the successor in order to avoid liability for the employment discrimination claim. Illinois Department of Human Rights v. Oakridge Nursing & Rehab Center, et al., 2019 IL App (1st) 170806, March 11, 2019. The employee filed an age and disability discrimination charge (the "Charge") against his employer under the Illinois Human Rights Act ("IHRA"). After the employer received notice of the Charge, it transferred substantially all of its assets to a related but separate business entity. Subsequently, a judgment in the amount of $30,000 was awarded by the Illinois Human Rights Commission to the employee and against the employer, which the employer failed to pay.
On March 6, 2019, the U.S. Court of Appeals for the Seventh Circuit held that the district court did not err in its jury instruction about the legal consequences of an employee's failure to cooperate with her employer in identifying a reasonable accommodation. Sansone v. Brennan, Postmaster General of the United States, No. 17-3534 & No. 17-3632 (7th Cir. March 6, 2019). The plaintiff, a postal employee confined to a wheelchair, was for years provided by the Postal Service with a parking spot with room to deploy his van's wheelchair ramp, until it took that spot away and failed to provide him with a suitable replacement. He filed a lawsuit against the Postal Service, alleging that it failed to accommodate his disability. A jury returned a verdict in favor of the plaintiff, and he recovered compensatory damages, as well as back pay and front pay. The Service appealed on various grounds, including a jury instruction that it claimed was erroneous regarding the required interactive process between an employer and employee to find a reasonable accommodation.