Williams v. Katz, No. 93-3332

CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)
Writing for the CourtBefore POSNER, Chief Judge, and COFFEY and ROVNER; POSNER
Citation23 F.3d 190
PartiesJerry G. WILLIAMS and Theresa Williams, Plaintiffs-Appellees, v. Allen B. KATZ and Goldberg, Fohrman, Weisman & Cairo, Limited, Defendants-Appellees. Appeal of UNITED AIRLINES, INCORPORATED, Intervening Petitioner, Appellant.
Decision Date08 June 1994
Docket NumberNo. 93-3332

Page 190

23 F.3d 190
29 Fed.R.Serv.3d 339
Jerry G. WILLIAMS and Theresa Williams, Plaintiffs-Appellees,
v.
Allen B. KATZ and Goldberg, Fohrman, Weisman & Cairo,
Limited, Defendants-Appellees.
Appeal of UNITED AIRLINES, INCORPORATED, Intervening
Petitioner, Appellant.
No. 93-3332.
United States Court of Appeals,
Seventh Circuit.
Argued Feb. 22, 1994.
Decided May 5, 1994.
Rehearing Denied June 8, 1994.

Mark S. Grotefeld (argued), Aneta B. Sunaitis, Robins, Kaplan, Miller & Ciresi, Chicago,

Page 191

IL, John P. Borman, Robins, Kaplan, Miller & Ciresi, St. Paul, MN, for plaintiffs.

Elliot R. Schiff, Craig Wynn Church (argued), Kevin F. Donohue, O'Connor, Schiff & Myers, Chicago, IL, for defendant-appellee.

Erica Nan Goldmann, John Francis O'Reilly, Thomas W. Weber (argued), Wiedner & McAuliffe, Chicago, IL, for appellant.

Before POSNER, Chief Judge, and COFFEY and ROVNER, Circuit Judges.

POSNER, Chief Judge.

We are asked to decide whether under the law of Illinois an employer that pays workers' compensation benefits to an injured employee may ever assert a lien in a judgment or settlement obtained by the employee in a suit for legal malpractice. The issue, a novel one in Illinois, has divided the other appellate courts to consider it. Compare Toole v. EBI Cos., 314 Or. 102, 838 P.2d 60 (1992); McDowell v. LaVoy, 63 A.D.2d 358, 408 N.Y.S.2d 148 (1978), aff'd, 47 N.Y.2d 747, 417 N.Y.S.2d 255, 390 N.E.2d 1179 (1979); and Tallerday v. Delong, 68 Wash.App. 351, 842 P.2d 1023 (1993), all answering "yes," with Sladek v. K Mart Corp., 493 N.W.2d 838 (Ia.1992); Travelers Ins. Co. v. Breese, 138 Ariz. 508, 675 P.2d 1327, 1331-32 (App.1983); Soliz v. Spielman, 44 Cal.App.3d 70, 118 Cal.Rptr. 127 (1974), and Wausau Ins. Cos. v. Fuentes, 215 N.J.Super. 476, 522 A.2d 440 (App.1986), all answering "no." The court in Sladek acknowledged, however, that its interpretation was contrary to the policy of the statute, 493 N.W.2d at 841; and in Fuentes the language of the statute was stronger for the plaintiff than it is in our case.

Jerry Williams, a baggage handler for United Airlines, injured his arm at work. Two doctors failed--negligently, we may assume--to diagnose a ruptured biceps tendon. Williams claims to have suffered severe and permanent injury as a result of this failure. He obtained workers' compensation benefits in the amount of $226,000 from United. He asked the lawyers who were representing him in the workers' compensation case whether he might have a medical malpractice claim against the doctors. The lawyers are alleged to have dithered until the statute of limitations expired, so Williams (and his wife, who would have been a coplaintiff in his medical malpractice suit had one been filed, seeking damages for loss of consortium) filed with the aid of a new lawyer this diversity suit charging legal malpractice and seeking $3 million in damages. Pre-trial discovery is under way.

United Airlines moved to intervene in the legal-malpractice suit, as of right, under Fed.R.Civ.P. 24(a), claiming a lien of $226,000 against any judgment or settlement received by Mr. Williams (but not his wife) in the suit. The basis of this claim is section 5(b) of the Illinois workers' compensation statute, 820 ILCS 305/5(b), which provides that "where the injury or death for which compensation is payable under this Act was caused under circumstances creating a legal liability for damages on the part of some person other than his employer to pay damages," suit may be brought against such person; and if the suit is brought by the employee or his representative, "the employer may have or claim a lien upon any award, judgment or fund out of which such employee might be compensated from such third party." The district court denied the motion to intervene, holding that the lawyers whom Williams has sued are not the sort of third party to whom the Act refers, so United has no lien and hence no basis for intervening. United has appealed from this order. We must consider first whether it is appealable.

The order does not of course wind up the suit in the district court, so it is not conventionally final. But it is final as to United, which having been denied the status of a party will never be able to appeal again in this proceeding unless the order denying intervention is reversed now. Marino v. Ortiz, 484 U.S. 301, 108 S.Ct. 586, 98 L.Ed.2d 629 (1988) (per curiam); United States v. City of Chicago, 870 F.2d 1256, 1258 (7th Cir.1989). An order denying intervention was held appealable on this ground in Brotherhood of Railroad Trainmen v. Baltimore & Ohio R.R., 331 U.S. 519, 524-25, 67 S.Ct. 1387, 1390, 91 L.Ed. 1646 (1947), without reference to the collateral order doctrine (on which see, e.g., Crist v. Miller, 846 F.2d 1143 (7th Cir.1988)), which had not yet crystallized.

Page 192

Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546-47, 69 S.Ct. 1221, 1225-26, 93 L.Ed. 1528 (1949). In Stringfellow v. Concerned Neighbors in Action, 480 U.S. 370, 377-78, 107 S.Ct. 1177, 1182-83, 94 L.Ed.2d 389 (1987), the Supreme Court, citing Railroad Trainmen, confirmed the continued validity...

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20 practice notes
  • Kleber v. CareFusion Corp., No. 17-1206
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • April 26, 2018
    ...of Internal Revenue , 74 F.3d 1528, 1532 (7th Cir. 1996) (appealing "denial of ‘innocent spouse’ status" in Tax Court); Williams v. Katz , 23 F.3d 190, 191 (7th Cir. 1994) (spurned intervenor permanently "denied the status of a party" in litigation); Lister v. Hoover , 655 F.2d 123, 124–25 ......
  • Haugenoe v. Workforce Safety and Ins., No. 20070099.
    • United States
    • United States State Supreme Court of North Dakota
    • April 22, 2008
    ...interest in legal malpractice proceeds. See Frazier v. N.J. Mfrs. Ins. Co., 142 N.J. 590, 667 A.2d 670 (1995); Williams v. Katz, 23 F.3d 190 (7th Cir.1994) (interpreting Illinois law); Nicholas v. Morgan, 58 P.3d 775 (Okla.2002); Tallerday v. Delong, 68 Wash.App. 351, 842 P.2d 1023 (1993); ......
  • Rhode Island v. U.S.E.P.A., No. 04-1513.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • August 3, 2004
    ...plainly satisfies the second prong of the test; the issue is separable from the merits of the underlying proceeding. Cf. Williams v. Katz, 23 F.3d 190, 192 (7th Cir.1994) (holding that the question of a putative intervenor's status was "entirely separate from" the underlying tort action). T......
  • Kleber v. Carefusion Corp., No. 17-1206
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • January 23, 2019
    ...of Internal Revenue , 74 F.3d 1528, 1532 (7th Cir. 1996) (appealing Tax Court’s "denial of ‘innocent spouse’ status"); Williams v. Katz , 23 F.3d 190, 191 (7th Cir. 1994) (spurned intervenor permanently "denied the status of a party" in litigation); Lister v. Hoover , 655 F.2d 123, 124–25 (......
  • Request a trial to view additional results
20 cases
  • Kleber v. CareFusion Corp., No. 17-1206
    • United States
    • U.S. Court of Appeals — Seventh Circuit
    • April 26, 2018
    ...of Internal Revenue , 74 F.3d 1528, 1532 (7th Cir. 1996) (appealing "denial of ‘innocent spouse’ status" in Tax Court); Williams v. Katz , 23 F.3d 190, 191 (7th Cir. 1994) (spurned intervenor permanently "denied the status of a party" in litigation); Lister v. Hoover , 655 F.2d 123, 124–25 ......
  • Haugenoe v. Workforce Safety and Ins., No. 20070099.
    • United States
    • United States State Supreme Court of North Dakota
    • April 22, 2008
    ...interest in legal malpractice proceeds. See Frazier v. N.J. Mfrs. Ins. Co., 142 N.J. 590, 667 A.2d 670 (1995); Williams v. Katz, 23 F.3d 190 (7th Cir.1994) (interpreting Illinois law); Nicholas v. Morgan, 58 P.3d 775 (Okla.2002); Tallerday v. Delong, 68 Wash.App. 351, 842 P.2d 1023 (1993); ......
  • Rhode Island v. U.S.E.P.A., No. 04-1513.
    • United States
    • United States Courts of Appeals. United States Court of Appeals (1st Circuit)
    • August 3, 2004
    ...plainly satisfies the second prong of the test; the issue is separable from the merits of the underlying proceeding. Cf. Williams v. Katz, 23 F.3d 190, 192 (7th Cir.1994) (holding that the question of a putative intervenor's status was "entirely separate from" the underlying tort action). T......
  • Kleber v. Carefusion Corp., No. 17-1206
    • United States
    • United States Courts of Appeals. United States Court of Appeals (7th Circuit)
    • January 23, 2019
    ...of Internal Revenue , 74 F.3d 1528, 1532 (7th Cir. 1996) (appealing Tax Court’s "denial of ‘innocent spouse’ status"); Williams v. Katz , 23 F.3d 190, 191 (7th Cir. 1994) (spurned intervenor permanently "denied the status of a party" in litigation); Lister v. Hoover , 655 F.2d 123, 124–25 (......
  • Request a trial to view additional results

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