Management Ass'n of Illinois, Inc. v. Board of Regents of Northern Illinois University
| Decision Date | 18 June 1993 |
| Docket Number | No. 1-92-0476,1-92-0476 |
| Citation | 188 Ill.Dec. 124,618 N.E.2d 694,248 Ill.App.3d 599 |
| Parties | , 188 Ill.Dec. 124, 85 Ed. Law Rep. 157 The MANAGEMENT ASSOCIATION OF ILLINOIS, INC., Plaintiff-Appellee, v. BOARD OF REGENTS OF NORTHERN ILLINOIS UNIVERSITY, Mary Rose Hennessy, John Conrath, Daniel Hochstetter, David Murray, Sandra Pater, and Sharon Young, Defendants-Appellants. |
| Court | United States Appellate Court of Illinois |
Gessler, Flynn, Fleischmann, Hughes & Socol, Ltd., Chicago (George W. Gessler, Michael J. Flaherty, of counsel), for appellants.
Sidley & Austin, Chicago (Stephen C. Carlson, Gloria R. Mitka, of counsel), George M. Shur, Lowden Hall, Northern Illinois University, DeKalb, for appellees.
Plaintiff, The Management Association of Illinois, Inc., appeals from the order of the circuit court of Cook County granting defendants' 2-619 motion to dismiss plaintiff's action for damages, injunction, and other relief against defendants, the Board of Regents of Northern Illinois University, Mary Rose Hennessy, John Conrath, Daniel Hochstetter, David Murray, Sandra Pater and Sharon Young. The issue on appeal is whether the circuit court of Cook County has subject matter jurisdiction over plaintiff's claims.
On appeal, plaintiff contends that, as to all counts other than the Trade Secrets Act count, the various forms of relief sought against the Board of Regents of Northern Illinois University (injunction, accounting, constructive trust) do not affect the State's legitimate actions or subject the State to liability for damages so as to make this a suit against the State within the meaning of the Court of Claims Act. (Ill.Rev.Stat.1991, ch. 37, par. 439.1 et seq.). Although plaintiff seeks money damages from the Board of Regents in its Trade Secrets Act count, plaintiff contends that by the language of the Illinois Trade Secrets Act, (Ill.Rev.Stat.1991, ch. 140, par. 351 et seq.), the State has expressly consented to be sued for damages on claims under that Act; therefore, the count seeking damages is expressly excepted from Court of Claims jurisdiction.
Defendants contend in their brief that the language of the Trade Secrets Act does not expose the State of Illinois to suit in the circuit court and that the nature of each of plaintiff's other claims or the relief sought is such that the suit is encompassed within the jurisdiction of the Court of Claims as a suit against the State of Illinois. Therefore, defendants contend that the Court of Claims has exclusive jurisdiction over all counts of the complaint.
We affirm the trial court's order of dismissal on the grounds that the Court of Claims has exclusive subject matter jurisdiction.
The complaint alleges the following facts which for purposes of the 2-619 motion are not disputed. Plaintiff, the Management Association of Illinois, Inc. (the Association), is a not-for-profit corporation with its principal place of business in Cook County. The Association provides educational and training services to member companies and non-member companies and assists companies in securing grants to pay for Association services. The Association contracts with independent contractors who serve as instructors.
Prior to August 19, 1991, defendant Mary Rose Hennessy was a senior vice president for the Association. She was in charge of providing educational and training services to businesses on behalf of the Association. Prior to August 19, 1991, defendants John Conrath, Daniel Hochstetter, David Murray, Sandra Pater and Sharon Young were Association employees working under Ms. Hennessy's supervision. Conrath, Hochstetter, and Murray held management positions. The six individual defendants (Hennessy, Conrath, Hochstetter, Murray, Pater and Young) will be referred to collectively as "the Hennessy Group."
The Hennessy Group, on behalf of the Association, individually or collectively prepared and distributed workshop and course catalogs; initiated and maintained proposals and contracts for educational and training services; designed, priced and scheduled customized on-site training and other programs; and arranged for grants to clients to fund the Association's services. In the course of their duties, the Hennessy Group had access to lists of members, clients and prospective clients and to other confidential and proprietary marketing, sales and customer information.
Defendant Board of Regents of Northern Illinois University (NIU) is charged by statute with the management, control, operation, and maintenance of NIU. (Ill.Rev.Stat.1991 1991, ch. 144, par. 301.) The Business and Industry Services Department of NIU competes directly with the Association in providing educational and training services to businesses.
The complaint further alleges that on August 19, 1991, the Hennessy Group notified the Association that they intended to resign from the Association to become employed by the Business and Industry Services Department of NIU. The Association then ordered the Hennessy Group to vacate the Association premises and not to remove any confidential or proprietary information. The Hennessy Group vacated the premises. Soon afterwards, the Hennessy Group began employment at NIU where they continue to be employed.
On February 4, 1992, the Association filed suit alleging that the Hennessy Group removed from the Association its membership list, lists of clients and prospective clients, course descriptions and catalogs, contracts between the Association and its clients, education and training proposals for existing and potential clients, files concerning funding efforts by the Association on behalf of clients, and files concerning Association programs (collectively referred to as "Association Property"). According to the complaint, these acts were for the benefit of the Hennessy Group's new employer, NIU.
The complaint further alleges that the Hennessy Group encouraged other Association employees and instructors to leave the Association to work instead for NIU; that the Hennessy Group intentionally deleted certain courses from Association catalogs and failed to reserve space for some courses which were listed in the catalogs; that they held in abeyance some Association service proposals so that the proposals could be executed on behalf of NIU; that NIU assumed some contracts between the Association and its clients; that funding which the Association helped clients obtain for Association services was instead used to fund NIU services to those same clients.
The complaint also states the Hennessy Group made representations which they knew to be false to clients, potential clients and instructors of the Association concerning discontinuance of certain programs and reductions in pay to instructors. The complaint further alleges that the Hennessy Group used the Association's telephones and other facilities on the Association premises to solicit business for NIU.
The complaint avers that the acts of the Hennessy Group were wilfully designed to injure the Association and to benefit NIU and that the wrongful acts began in May, 1991 and were discovered sometime after August, 1991. The complaint does not delineate between acts and damages which occurred while the Hennessy Group was still employed by the Association and acts and damages which occurred later.
The complaint concludes that, as a result of the Hennessy Group's wrongful acts, plaintiff has suffered, and continues to suffer, loss of customers, loss of repeat business and referrals from those customers, damage to the Association's business reputation and loss of income. Plaintiff claims NIU is the direct recipient of much of the business lost by the Association.
Count I seeks injunctive relief. As to the Hennessy Group, their agents, and anyone acting in concert with them, plaintiffs request that these persons be enjoined from the following activities: retaining, or using without the Association's written permission, any of the Association Property; soliciting or accepting business from Association clients; encouraging Association employees to compete with the Association. In count I plaintiff also seeks restitution from the Hennessy Group members for compensation and benefits paid to them by the Association during their breach of fiduciary duty to the Association.
In count I plaintiff also requests that "defendants," encompassing NIU as well as the Hennessy Group, be enjoined from: using or destroying Association Property; inducing clients or prospective clients to do business with NIU instead of the Association; providing any services for, receiving any payments from, or maintaining any business relationship with any customer wrongfully taken from the Association making representations concerning the business of the Association; and unfairly competing with the Association. Also, plaintiff asks that defendants be required to tender Association Property to the court.
Count II seeks an accounting by NIU of all income received by NIU as a result of the Hennessy Group's wrongful acts and application of a constructive trust as to that income.
Count III claims an intentional breach, by those in the Hennessy Group, of fiduciary duties owed to the Association by virtue of their employment. Plaintiff seeks an injunction against "all of the defendants", prohibiting them from using Association Property, and damages of not less that $1,000,000 from the Hennessy Group.
Counts IV, V, and VI allege the torts of unfair competition, misappropriation, and tortious interference with business relations, respectively. These counts allege that the Hennessy Group acted intentionally with the purpose of unlawfully injuring the Association and its business, property and reputation, and that the Hennessy Group "intentionally, maliciously and wilfully engaged in unfair competition by taking and misappropriating for commercial advantage the Property of the Management Association...
To continue reading
Request your trial
-
Fenje v. Feld
...174 Ill.2d 597, 227 Ill.Dec. 18, 686 N.E.2d 1174 (1997); Management Association of Illinois, Inc. v. Board of Regents of Northern Illinois University, 248 Ill.App.3d 599, 188 Ill.Dec. 124, 618 N.E.2d 694, 704-06 (1st Dist.1993); Sarpolis v. Board of Trustees of University of Ill., 52 Ill.Ct......
-
Hobbs v. Cappelluti
...N.E.2d 1187, 1195, 322 Ill.App.3d 345, 256 Ill.Dec. 350 (Ill.App.Ct.2001); Mgmt. Ass'n of Ill., Inc. v. Bd. of Regents of N. Ill. Univ., 618 N.E.2d 694, 705, 248 Ill.App.3d 599, 188 Ill.Dec. 124 (Ill.App.Ct.1993). In Patterson v. Burge, the plaintiff alleged that prosecutors acted intention......
-
Rockford Memorial Hosp. v. Department of Human Rights
...ILCS 505/1 et seq. (West 1992)). (See 745 ILCS 5/1 (West 1992); Management Association of Illinois, Inc. v. Board of Regents of Northern Illinois University (1993), 248 Ill.App.3d 599, 606, 188 Ill.Dec. 124, 618 N.E.2d 694.) Under the Court of Claims Act, the Court of Claims has exclusive j......
-
Leetaru v. Bd. of Trs. of the Univ. of Ill.
...University must “be considered a unit of State government”); Management Ass'n of Illinois, Inc. v. Board of Regents of Northern Illinois University, 248 Ill.App.3d 599, 607, 188 Ill.Dec. 124, 618 N.E.2d 694 (1993) ; Raymond v. Goetz, 262 Ill.App.3d 597, 605, 200 Ill.Dec. 13, 635 N.E.2d 114 ......
-
Secrets, Sovereigns, and States: Analyzing State Government's Liability for Trade Secret Misappropriation
...Jean De La Bruyere, Les Caracteres, ch. V, para. 81 (1688)).2. Id.3. Id.4. E.g., Mgmt. Ass'n of Ill. v. Bd. Of Regents of N. Ill. Univ., 618 N.E.2d 694, 699 (1993) (holding that a company hired to train university employees could not recover against the State in district court for trade sec......