Wilson v. The Department of Financial and Professional Regulation
2013 IL App (1st) 121509
Ill. App. Ct.2013Background
- Wilson, a mortgage loan originator, was licensed in 2005 and renewed through 2006 while facing federal tax-fraud convictions.
- Wilson pled guilty in 2006–2001 federal cases; he paid restitution, paid fines, and was placed on probation.
- In 2007 the Department disciplined Wilson under prior law; renewals for 2008–2009 occurred with probation and conditions.
- A 2009 amendment to 205 ILCS 635/7-3(2) prohibited issuance of licenses to anyone convicted of a felony involving fraud or dishonesty, effective July 31, 2009.
- The Department denied Wilson’s 2010 license renewal based on the 2009 amendment; Wilson challenged, leading to administrative review and ensuing circuit and appellate proceedings.
- The appellate court applied de novo review to constitutional challenges and affirmed the Department’s decision to refuse renewal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the 2009 felony-conviction provision apply to renewals as to Wilson? | Wilson argues the provision governs issuance, not renewal. | Department contends the statute governs all licensees, including renewals. | Statute governs renewals; no distinction between issuance and renewal under the act. |
| Is retroactive application of the 2009 act ex post facto or due process barred? | The law retroactively increases punishment for past conduct, violating due process and ex post facto. | statute is civil, not punitive; retroactivity issue resolved by prospective application. | Not an ex post facto violation; factors show lack of punitive effect and forward-looking operation. |
| Does the denial of renewal constitute a taking requiring just compensation? | License denial is a taking of property interest in the license. | No vested property interest in a license; state may amend licensure requirements. | No protected property interest; no taking under the takings clause. |
| Does res judicata bar applying the 2009 law to Wilson due to prior orders? | Earlier disciplinary orders preclude new denial under the 2009 act. | Different issues and statutes; prior orders do not apply to the new provision. | Res judicata does not apply; 2007 and 2010 orders address different issues under different statutes. |
| Is the 2009 provision punitive under the seven Kennedy factors for ex post facto analysis? | Provision is punitive and retrospective. | Civil regulation aimed at protecting consumers and deterring unethical conduct. | Seven-factor test supports non-punitive, prospective legislative objective. |
Key Cases Cited
- Consiglio v. Department of Financial & Professional Regulation, 2013 IL App (1st) 121142 (2013 IL App (1st)) (not retroactive; license revocation analyzed as future effect on practice)
- Landgraf v. USI Film Products, 511 U.S. 244 (1994) (retroactivity and fair warning principles guiding ex post facto analysis)
- Smith v. Doe, 538 U.S. 84 (2003) (Kennedy factors for ex post facto analysis; not decisive alone)
- Fletcher v. Williams, 179 Ill. 2d 225 (1997) (due process and retroactivity considerations in state law)
- Hudson v. United States, 522 U.S. 93 (1997) (debarment and civil sanctions not always punitive for double jeopardy)
- Lavariega v. Illinois, 175 Ill. 2d 153 (1997) (license-related suspensions viewed as civil under public-protection rationale)
- John v. Department of Professional Regulation, 305 Ill. App. 3d 964 (1999) (vested rights doctrine in licensing context)
- Wineblad v. Department of Registration & Education, 161 Ill. App. 3d 827 (1987) (legislature may amend licensure requirements after issuance)
- Kansas v. Hendricks, 521 U.S. 347 (1997) (relevant to punitive/predictive analysis in ex post facto)
- United States v. Leach, 639 F.3d 769 (2011) (not retroactive solely because it applies to prior convictions)