Meier v. Musburger

Decision Date08 December 2008
Docket NumberNo. 08 C 216.,08 C 216.
Citation588 F.Supp.2d 883
CourtU.S. District Court — Northern District of Illinois
PartiesGarry MEIER, Plaintiff, v. Todd W. MUSBURGER, individually, and d/b/a as a non-existent entity known as "Law Offices Of Todd W. Musburger, Ltd.", Todd W. Musburger, Ltd., an Illinois corporation, and Brian Musburger, Defendants.

Walter Peter Maksym, Jr., Chicago, IL, for Plaintiff.

Carlin R. Metzger, Richard T. Greenberg, McGuirewoods, LLP, Susan E. Groh, Chicago, IL, for Defendants.

MEMORANDUM OPINION AND ORDER

JEFFREY COLE, United States Magistrate Judge.

INTRODUCTION

This case began five years ago with a dispute between Garry Meier, a popular radio talk show host in Chicago, and his attorney, Todd Musburger. Unfortunately, their falling-out came in the middle of contract negotiations between Mr. Meier and the radio station for which he worked, and it had the effect of scuttling any deal that might have been made. That left Mr. Meier without a show or income, and left Mr. Musburger without that portion of the fees he otherwise would have earned had he been able to negotiate a new contract for Mr. Meier. Each felt badly used by the other, and as inevitably occurs when people quarrel over money and perceived wrongdoing, the parties found themselves in litigation. Mr. Musburger sued for the fees he said he had earned in connection with the unsuccessful negotiation for the new contract; Mr. Meier responded with a counter claim for negligence and breach of fiduciary duties. The case was ultimately tried to a jury, which found for Mr. Musburger. An appeal followed in the Illinois Appellate Court.

Rather than awaiting the outcome of the appeal—the case remains pending—Mr. Meier sued Mr. Musburger in this court charging that he violated the Racketeer Influenced and Corrupt Organization Act ("RICO"). 18 U.S.C. § 1961 et seq. The 64-page First Amended Complaint ("Complaint")—much of which is single-spaced— contains two RICO counts and 26 claims under Illinois law. The first 133 paragraphs of the 181-paragraph complaint span 40 pages and purport to set forth the operative facts on which all the counts are based. They are the same facts that underlay the state court complaint. Without the RICO count there would be no federal jurisdiction since the parties are both citizens of Illinois. See Lincoln Property Co. v. Roche, 546 U.S. 81, 89, 126 S.Ct. 606, 163 L.Ed.2d 415 (2005).

Mr. Musburger has moved to dismiss the complaint, arguing, inter alia, that: (1) because the jury's verdict in the state court had settled the underlying dispute in his favor, the complaint was barred by either or both the Rooker-Feldman doctrine and the doctrine of res judicata, and (2) Mr. Meier had failed to adequately state a claim under RICO. As we shall see, the Rooker-Feldman doctrine is inapplicable, and the question of whether res judicata applies eludes easy answer for, as the Seventh Circuit has said, "[t]o be blunt, we have no idea what the law of Illinois is on the question whether a pending appeal destroys the claim preclusive effect of a judgment." Rogers v. Desiderio, 58 F.3d 299, 302 (7th Cir.1995).1 But no matter, because the unanswerable argument is that the RICO claims are deficient and constitute an attempt to fabricate federal jurisdiction, and an action will not lie in federal court if the federal claims are made solely for the purpose of obtaining jurisdiction or where such claims are wholly insubstantial and frivolous. Arbaugh v. Y & H Corp., 546 U.S. 500, 513, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006); Jagla v LaSalle Bank, 253 Fed.Appx. 597, 599 (7th Cir.2007).

But there is one more wrinkle. In response to the motion to dismiss, Mr. Meier's counsel did an odd thing: he moved to stay the case under the Colorado River abstention doctrine, Colorado River Water Conservation Dist. v. United States, 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976), and the Seventh Circuit's decision in Rogers, supra, because of the pending appeal of the state court judgment. That's a curious move from a plaintiff who filed the federal lawsuit and initially insisted that it proceed while his state appeal was pending. One reason might have been to avoid the state court judgment's possible immediate preclusive effect in the hope the case would be reversed during the stay. But during a hearing on the motion, Mr. Meier's counsel expressed the view that the outcome of the appeal was irrelevant to the outcome of this case.

It was his position that if the state court case were reversed, this case could still proceed, and if it were affirmed, this case would proceed apparently in tandem with a new trial in the state court. Given that theory—which seems wrong2—no purpose would be served by a stay. In any event, the Colorado River doctrine is inapplicable here. Under the doctrine, there are limited circumstances where a federal court may abstain from exercising its jurisdiction over a case where there is a parallel state court suit. See Colorado River Water Conservation Dist., 424 U.S. at 813-17, 96 S.Ct. 1236; Tyrer v. City of South Beloit, Ill., 456 F.3d 744, 747 (7th Cir.2006). As Mr. Meier's RICO claims are deficient, there is no jurisdiction to abstain from exercising. See infra at 898.

I. FACTUAL BACKGROUND3
A. The Negotiations For The 2004 Renewal Of The 1999 Contract Begin

For several years prior to 2003, Mr. Meier had co-hosted a radio talk show with Roe Conn on WLS-AM in Chicago. Beginning in 1998, he was represented in his contract negotiations with the station by Mr. Musburger, an attorney licensed to practice in the State of Illinois. (Complaint, ¶¶ 6-12). Mr. Musburger's professional corporation was Todd W. Musburger, Ltd., which was registered with the Illinois Secretary of State, but not with the Illinois Supreme Court under Rule 721. Neither Mr. Musburger nor Todd W. Musburger, Ltd. was licensed as an employment agency under the Illinois Private Employment Agency Act. (Complaint, ¶¶ 74, 160). Mr. Musburger was operating his law practice under the name, "The Law Offices of Todd W. Musburger, Ltd." (Complaint, ¶¶ 8,109-130).

For many years prior to 1998, Mr. Musburger had been Mr. Meier's "agent and exclusive legal representative for the negotiating and drafting of [his] agreements in the entertainment fields of radio and television, in exchange for a fee of five percent (5%) of the gross amount of any employment compensation and income payable to [him] under each such agreement." (Complaint, ¶ 12). In 1999, after Mr. Musburger had handled negotiations on plaintiff's behalf, plaintiff signed a new contract with WLS-AM, which was set to expire in February 2004.

Things went well until the summer of 2003 when it was time to negotiate a new deal. The plaintiffs co-host, Roe Conn, was represented by a different agent, and had a separate contract with the station. But it occurred to Mr. Meier and Mr. Musburger that they could secure the best terms in a new pact if plaintiff and Mr. Conn "present[ed] a unified front" in the upcoming negotiations. (Complaint, ¶ 16). Mr. Musburger drew up a proposed agreement to that effect for Mr. Conn's approval and sent it to his agent. Mr. Conn never signed the agreement, but whenever plaintiff asked Mr. Musburger about it, he assured him it "had been `taken care of." (Complaint, ¶¶ 19-20).

On August 6, 2003, WLS-AM submitted a written proposal for a contract renewal for plaintiff, but he and Mr. Musburger concurred that the offer from Mr. Jones, the President and General Manager of WLS, was "truly insulting." (Complaint, ¶ 35). They also agreed that part of their strategy going forward would be to avoid contact with Mr. Jones. (Complaint, ¶¶ 23-22). Within two months, the plaintiff and Mr. Musburger were not to see eye-to-eye on anything.

B. A Rift Develops Between Mr. Meier And Mr. Musburger

On September 4th, Mr. Musburger submitted a new fee agreement to plaintiff. It included several new provisions, the most troubling for the plaintiff being the following:

(a) We may render similar services to others, including persons of the same general qualifications and eligibility for similar employment, and such representation shall not constitute a violation of our fiduciary or other obligations hereunder.

(Complaint, ¶ 25). Plaintiff refused to sign the new fee agreement. In fact, he left a voice mail for Mr. Musburger saying he "want[ed] to put everything on hold right now" and take a week or so to think things over. (Complaint, ¶¶ 26-27). He instructed Mr. Musburger not "to meet with anyone or have any further conversations with anyone," and to cancel any meetings regarding the WLS contract renewal that he might have scheduled. The plaintiff proposed that the two meet on September 23, 2003, to discuss things. (Complaint, ¶ 27). Plaintiffs wife also sent Mr. Musburger an email to the same effect. He later learned that, during the negotiations, Mr. Musburger was also representing another talk show host, from another Chicago station, whom he suspects Musburger was attempting to seat in the plaintiffs chair beside Mr. Conn. (Complaint, ¶¶ 65-72).

Mr. Musburger responded to plaintiffs voice mail the next day with two letters, which he sent by messenger to the plaintiff. In the first, he reminded the plaintiff that he had a previously scheduled meeting about the new pact with Mr. Jones and Mike Packer, operations director at WLAM, that day and said that it was "evident that ABC is poised to finalize an agreement with us in the financial range that Garry is seeking. This would take the program to the highest level ever reached in Chicago radio." (Complaint, ¶ 29). He cautioned against the two-week delay proposed by Mr. Meier, but said he would be happy to meet on the 23rd of September. (Id.).

In the second letter, Mr. Musburger wrote that he was "mystified as to the reasons for...

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