Smith v. The Vanguard Group Inc., 129 N.E.3d 1216

JoAnn and Donald Smith were married and maintained several financial accounts, including a Vanguard IRA titled solely in Donald’s name; no beneficiary was listed before 2013.
While hospitalized in July–August 2013, a beneficiary designation naming JoAnn was entered; shortly after, Donald sued JoAnn seeking a TRO and preliminary injunction alleging she had withdrawn and converted his funds.
The parties entered a stipulated preliminary injunction (Aug. 8, 2013) that ordered restoration of withdrawn funds and provided that the spouses’ financial accounts were “closed to any transactions” without written agreement or further court order; the injunction and a later dissolution action remained pending and were consolidated.
On March 13, 2014, while the injunction was still in effect, Donald changed the Vanguard IRA beneficiary to his sons, Scott and Jeffrey.
The dissolution and injunction were dismissed by stipulation on Oct. 29, 2014; Donald died March 30, 2015. JoAnn sued for declaratory relief and alleged fraud, claiming the beneficiary change violated the injunction and was void.
The trial court dismissed JoAnn’s declaratory claim under section 2-619; the appellate court affirmed. The Illinois Supreme Court granted leave and affirmed, holding the beneficiary change did not violate the injunction because it did not effect an immediate change in account ownership while the injunction was in force.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Donald’s change of the Vanguard IRA beneficiary while a stipulated injunction was in effect violated the injunction and is void	JoAnn: The injunction’s ban on "transactions" and on transfers/withdrawals encompassed beneficiary changes, so the change violated the court order and is void	Scott and Jeffrey: "Transaction" as used in the injunction refers to actions that immediately affect account balances (withdrawals, trades, transfers); a beneficiary designation is a contingent expectancy and does not immediately alter ownership	The court held the injunction was aimed at preserving the immediate status and balances of accounts; a beneficiary designation is a contingent future interest and did not effect a change in ownership while the injunction was in effect, so the change did not violate the injunction and is valid

King v. First Capital Financial Services Corp., 215 Ill. 2d 1 (2005) (standard of review for section 2-619 dismissals).
Cummings-Landau Laundry Machinery Co. v. Koplin, 386 Ill. 368 (1944) (orders issued by a court with jurisdiction must be obeyed until set aside).
Hartlein v. Illinois Power Co., 151 Ill. 2d 142 (1992) (purpose of a preliminary injunction is to preserve the status quo).
New York Life Ins. Co. v. Sogol, 311 Ill. App. 3d 156 (1999) (life-insurance beneficiary change held to violate a stipulated injunction where death occurred while injunction remained in effect).
In re Marriage of Centioli, 335 Ill. App. 3d 650 (2002) (beneficiary designations viewed as expectancy interests not protected as present property by dissolution injunction).