Lawrence Hess v. Kanoski & Associat
668 F.3d 446
| 7th Cir. | 2012Background
- Hess, hired May 9, 2001, worked on medical malpractice cases under an employment agreement with salary and bonuses; contract later increased to 40% of fee revenue; Hess was fired Feb. 14, 2007 and several of his cases were reassigned to Blan, who led settlements including a June 2008 $1.25 million case; Hess sought bonuses for post-termination work and filed liens in Illinois; he then sued in federal court asserting state-law and other claims; district court granted summary judgment based on collateral estoppel from state court decisions; court concludes state decisions did not resolve post-termination bonus rights and remands for contract interpretation; other counts (consumer fraud, wrongful discharge, fiduciary duty, unjust enrichment, etc.) are largely dismissed; only Counts I (IWPCA) and IV (breach of contract) are reversed and remanded for merits, with Counts V–XI largely affirmed or dismissed as applicable; costs to be borne by each side.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Hess is entitled to post-termination bonuses under the employment agreement. | Hess contends contract entitles bonuses on post-termination settlements. | Firm argues no post-termination bonus absent clear contract terms. | Remanded for contract interpretation; not decided on merits. |
| Whether state-court lien decisions collaterally estopped Hess from seeking post-termination bonuses in federal court. | Hess argues prior proceedings did not resolve his contract rights. | State decisions foreclose his claims. | Not precluded; remand for contract interpretation. |
| Whether Hess’s tortious-interference and related claims against Blan and the firm survive. | Claims arise from alleged inducement of breach of Hess’s contract. | Interference claims fail under Illinois law as no “other” contract; no causation for Blan. | Counts V and VI affirmed as to Blan and the firm; others dismissed. |
Key Cases Cited
- Outboard Marine Corp. v. Liberty Mut. Ins. Co., 607 N.E.2d 1204 (Ill. 1993) (undefined terms and contract interpretation grounded in ordinary meaning; extrinsic evidence allowed to determine intent)
- Henderson-Smith & Assoc., Inc. v. Nahamani Family Serv. Ctr., Inc., 752 N.E.2d 43 (Ill. App. Ct. 2001) (elements of contract claim require contract formation and breach)
- Thompson v. Gordon, 947 N.E.2d 39 (Ill. 2011) (extrinsic evidence to determine contract intent when language is ambiguous)
- Egan v. Freedom Bank, 659 F.3d 639 (7th Cir. 2011) (summary judgment review requires inferences in favor of nonmovant)
- Holmes v. Potter, 552 F.3d 536 (7th Cir. 2008) (independent review in contract interpretation)