The Employees' Retirement System of The State of Hawaii v. Clarion Partners, LLC
2017 IL App (1st) 161480
| Ill. App. Ct. | 2017Background
- Stephen Jackson, an Illinois real estate broker, filed a qui tam suit under the Hawaii False Claims Act on behalf of the Hawaii Employees’ Retirement System (HERS) and the State of Hawaii against Clarion Partners, LLC (CP) and ING Clarion Realty Services (CRS), alleging CP performed unlicensed broker activities for HERS’s Northbrook property.
- Jackson previously pursued essentially the same qui tam theory on behalf of the State of Illinois against CP and related ING entities in an earlier Cook County action (Jackson I), where the court dismissed his qui tam claim and later he obtained a jury verdict on unrelated promissory estoppel claims against his former employer.
- CP moved for summary judgment in Jackson II arguing res judicata barred the claim; the circuit court found the elements of res judicata satisfied but denied res judicata on procedural grounds and instead granted summary judgment on the merits and as time-barred.
- CP sought costs under Illinois law but attempted to recover the broader categories of costs available under Hawaii law; the trial court awarded only $936 under Illinois procedure and denied Hawaii-cost recovery.
- On appeal, the Illinois Appellate Court affirmed summary judgment but upheld res judicata as an alternative ground; it also affirmed the denial of Hawaii-based costs, holding Illinois procedural rules govern cost awards in Illinois courts.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Jackson's suit is barred by res judicata | Jackson argued prior dismissal did not bar new suit; relied on Piagentini acquiescence theory | CP argued the prior dismissal of the qui tam claim involved same cause and parties, so res judicata bars relitigation | Court held res judicata applies; prior involuntary dismissal was a final judgment on the merits and the claims arise from same operative facts |
| Whether Jackson proved CP violated Illinois Real Estate License Act (substantive claim) | Jackson alleged CP performed licensed activities for HERS without a broker license | CP denied it violated the Act | Court did not reach merits after affirming res judicata (trial court had also found no violation) |
| Timeliness (statutes of limitations/repose) | Jackson contended claims were timely or otherwise actionable | CP argued most claims were time-barred | Court affirmed summary judgment on timeliness as alternative ground but relied on res judicata principally |
| Proper measure of taxable costs (Hawaii vs Illinois law) | Jackson opposed broader Hawaii costs; implicitly argued Illinois controls | CP argued section 5-109 allows recovery “by like process,” meaning costs a prevailing party would get under the foreign substantive statute (Hawaii) | Court held “by like process” refers to procedural mechanism; Illinois law governs costs in Illinois court, so Hawaii’s broader cost statute did not apply |
Key Cases Cited
- Outboard Marine Corp. v. Liberty Mut. Ins. Co., 154 Ill. 2d 90 (discussing de novo review of summary judgment)
- Rein v. David A. Noyes & Co., 172 Ill. 2d 325 (res judicata elements and scope)
- River Park, Inc. v. City of Highland Park, 184 Ill. 2d 290 (same cause of action defined by single group of operative facts)
- Piagentini v. Ford Motor Co., 387 Ill. App. 3d 887 (addressed defense acquiescence; court treated acquiescence discussion as dicta)
- Gillen v. State Farm Mut. Auto. Ins. Co., 215 Ill. 2d 381 (discussing horizontal stare decisis in Illinois Appellate Court)
- Murneigh v. Gainer, 177 Ill. 2d 287 (noting res judicata is equitable doctrine)
- Rodriguez v. Sheriff’s Merit Comm’n, 218 Ill. 2d 342 (affirming judgment may be sustained on any correct basis supported by record)
- People v. Williams, 204 Ill. 2d 191 (distinguishing obiter dicta from binding judicial dicta)
- Relf v. Shatayeva, 2013 IL 114925 (statutory construction reviewed de novo)