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Gary Ganzi and his sister, Claire Ganzi Breen, sued their cousins back in 2012 for allegedly cheating them out of millions of dollars in royalties over the course of more than 40 years. A state court judge in Manhattan sided with the Ganzi siblings, saying the actions of the defendants, Walter Ganzi Jr. and Bruce Bozzi Jr., constituted a breach of fiduciary duty in which they prioritized their own financial wellbeing above the responsibility they bore their shareholders.

The defendants are the grandsons of the original founders of the iconic Palm steakhouse, and together they own a controlling share of the company, Just One More Restaurant Corp., which owns the chain of restaurants. They have opened more than 20 Palm restaurants across the U.S. and have licensed intellectual property related to the restaurant, including the right to use the name, logo, and the look and feel of the original Palm. The Ganzi siblings own all that intellectual property and the defendants allegedly licensed that property from them every time they opened a new Palm restaurant.

The price of licensing that intellectual property was set at a flat rate more than four decades ago, and as a result, the Ganzi siblings have been paid $6,000 in licensing fees for every new Palm restaurant that opens, but they claim that it’s worth much more. Continue reading ›

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Although e-cigarettes were first marketed as a way for smokers to quit smoking, not only has it been proven that they are not an effective way to quit smoking, but e-cigarette companies, like Juul, have actually gotten young people addicted to nicotine by targeting teens and young adults who had not previously been smokers.

Despite the fact that vaping has been marketed as a safe alternative to smoking, the reality is that it has contributed to thousands of cases of lung cancer. In addition to nicotine, many e-cigarettes also contain THC, which is a psychoactive ingredient.

Dr. Ngozi Ezik, the Director of the Illinois Department of Public Health, has reported that 201 cases of lung illnesses in Illinois alone have been confirmed as vaping-related illnesses. The youngest patient was just 13 years old. Five deaths in Illinois have been linked to vaping.

Juul is the most popular e-cigarette company by far, and it is now facing a consumer fraud lawsuit by the state of Illinois for having targeted teens. Among other things, the lawsuit alleges Juul has been instrumental in undoing decades of work by both government agencies and anti-tobacco activists towards reducing smoking rates among teens. Despite the initial success of those efforts, which saw teen use of nicotine drop from 36% in 1997 to 5% in 2017, new data shows that the use of e-cigarettes among both teens and middle school students is currently on the rise. Continue reading ›

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Hudson’s Bay (HBC), the Canadian retail company that owns Saks, among other high-end stores, has been sued by lenders who claim the reorganization of the company that happened earlier this year was conducted in an attempt to set up a secret corporate shell game that has robbed the credit that exists as insurance on the $850 million loan the plaintiffs have invested in the company.

The lawsuit centers around the fact that, as the owner of stores like Saks and Lord & Taylor, HBC was responsible for guaranteeing payment on all loans for the stores, including making sure the rent was paid if the stores themselves were in financial distress or unable to make rent for any other reason.

Earlier this year, HBC formed a new Bermuda corporation, which is owned by shareholders with a controlling interest in HBC, as well as executives at the highest levels of HBC’s corporate hierarchy. According to the plaintiff, Situs Holdings, this transfer of assets is not only improper but also violates the loan agreement and puts at risk the company’s ability to repay the loan.

HBC denies all the allegations, claiming the restructuring amounted to little more than a change in name and some paper shuffling. It also alleges that Situs never had any claim on the assets of HBC that were reassigned in the course of the restructuring process. The Canadian retail company insists that Situs’s reaction to the restructuring is far beyond what the restructuring actually accomplishes and that the plaintiff’s claims that HBC allegedly conducted this restructuring in secret, deliberately keeping it concealed from Situs, are likewise false. Continue reading ›

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If someone is accused of defrauding investors in one city, does that mean that person can’t do business with another company in another city? Especially before the allegations of fraud have been determined by a court of law?

That’s the question James “Woody” Dillard’s attorneys and business partners are asking as investors who were allegedly defrauded by Dillard try to claim potential vendors for Dillard and his business partners should have all their facts in order before signing on the dotted line.

Dillard has recently partnered with Streamline Boats of Hialeah, Florida, which makes semi-custom fishing boats. Although the company is only a couple years old, it has already changed locations several times and is currently looking to sign a lease for warehouse space at the Port of Pensacola. The city of Pensacola has put the lease on hold while they investigate.

Specifically, the city is worried about styrene, a foul-smelling by-product from working with fiberglass, which is a prominent material used to make all kinds of boats these days. Having made strides in reducing their emissions and their impact on the environment, the city is concerned that having a boat manufacturer in their warehouse district will undo much of the work they’ve done towards making and maintaining a more eco-friendly city.

Sanchez, one of the managers of Streamline Boats, claims they use very little styrene in the production of their boats, and that they invest heavily in the warehouse space they use to make sure they don’t stink it up. Essentially, they strive to become ideal tenants.

But two investors who invested in another of Dillard’s business ventures claim emissions should be the least of the city’s concerns when deciding whether to approve the lease. Continue reading ›

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Last fall, Alden Shoe Co. realized its CFO had allegedly been embezzling millions of corporate funds and transferring them to his own, personal accounts. More than half of what he allegedly stole from the shoe company he is claimed to have used to pay for gifts he gave to Bianca de la Garza, including a car, diamond jewelry, designer clothes and handbags, and investing in her production company, Lucky Gal Productions.

Unfortunately, Lucky Gal Productions according to news reports has never turned a profit in the six years since it was founded, making it unlikely the former CFO will ever see a return on his investment.

Richard Hajjar was hired by the shoe company back in 1987. His two brothers already worked for the company and his father had been the CPA for Arthur S. Tarlow Jr., Alden’s current president. No one questioned Hajjar’s loyalty until last fall when Tarlow realized Hajjar had allegedly been moving funds from the company’s bank account into family trusts. When he approached Hajjar about it, Hajjar allegedly dodged the question but assured Tarlow the funds would be transferred back into the company’s bank account.

Hajjar then according to news reports stopped showing up for working, texting Tarlow to say he wasn’t feeling well. When the funds didn’t show up in the bank account, Hajjar allegedly stopped responding to Tarlow’s text messages, and Tarlow went to his Santander bank branch, where the shoe company had accounts. Tarlow then discovered that $10 million in retained earnings was allegedly missing from the account. Continue reading ›

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E-commerce and tech behemoth, Amazon, has filed a lawsuit against the former vice president of marketing for its Amazon Web Services division, Brian Hall, alleging that his new role at Google Cloud violates the terms of his non-compete agreement. In its complaint, Amazon alleges that Hall’s employment with Google threatens to cause irreparable harm and risks exposing valuable competitive information to one of its biggest rivals. Amazon seeks both money damages and injunctive relief, requesting that the court enjoin Hall from working for Google for the remainder of the 18-month non-compete period set forth in the agreement.

This lawsuit is the latest in a series of lawsuits filed by Amazon to enforce non-compete clauses in employment contracts. In 2017, Amazon sued another former vice president who left Amazon Web Services to take a job with a Seattle-area software company but dropped the suit shortly after filing it. In 2019, Amazon filed a similar suit against a former Amazon Web Services sales executive after he too left the company to take a job with Google Cloud. A judge ultimately agreed to partially limit certain aspects of that employee’s role at Google but did strike down certain portions of the restrictive covenant as “unreasonable” and took Amazon to task for taking a one-size-fits-all approach to its non-compete agreement. This latest lawsuit comes after Washington state enacted a new law last year that severely restricted the use of non-compete agreements within the state. We previously wrote about that new law here. Continue reading ›

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After a disgruntled client posted a review on Yelp page of his former attorney, and the attorney responded, the attorney sued the client for defamation. The client responded by filing counterclaims for defamation, breach of fiduciary duty, and legal malpractice. The district court dismissed the client’s counterclaims for breach of fiduciary duty and malpractice while denying the attorney’s motion to dismiss the defamation counterclaim. The court then denied cross-motions for summary judgment, finding that genuine disputes of fact remained.

Alisa Levin is an attorney licensed in Illinois. Paul Abramson is a resident of California Abramson hired Levin to assist a different attorney with writing services in an Illinois lawsuit. Abramson alleged that he hired Levin as a ghostwriter, and her name was not to be included in any filings. Abramson paid Levin a $4,000 retainer and signed a written retainer agreement specifying that Levin would charge $315 an hour for her time.

In December 2015, Levin sent Abramson an invoice for 37.5 hours of her time, which resulted in fees of $9,167 over and above the $4,000 retainer. Abramson responded and disputed the amount, but Levin charged Abramson’s credit card later that day. Abramson then terminated Levin shortly after that by asking her to stop work in an email. Abramson then made complaints to the Chicago Bar Association and Illinois Attorney Registration and Disciplinary Committee. Abramson also initiated a chargeback dispute with his bank, but after an investigation the bank returned the funds to Levin in June 2016. In 2017, Abramson began invoicing Levin’s firm and had a collection agency make calls to Levin. Continue reading ›

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The ARDC Hearing Board recommended a two-year suspension for attorney Joel Brodsky due in large part to a case where his own attorney Joe “the Shark” Lopez admitted that Brodsky engaged in “Rambo” tactics. The Hearing Board found based on clear and convincing evidence that Brodsky harrassed opposing counsel and the Plaintiff’s expert witness with baseless claims.  It held:

We find the Administrator proved a violation of Rule 3.1 by clear and convincing evidence. Moreover, we concur with the district court’s view of Respondent’s actions as “wildly inappropriate” and the Seventh Circuit’s opinion that his conduct was “beyond the pale.”

As to Brodsky’s failure to provide any meaningful apology or show true remorse the Hearing Board had this to say:

Continue reading ›

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After CEO and Chairman of closely held company was removed by board of directors, he sued, requesting specific performance of the removal of the other members of the board. The Chancery Court dismissed several claims in the complaint for want of personal jurisdiction, and also denied the CEO’s motion for summary judgment, finding that each side of the litigation alleged disputed facts and complex legal theories not appropriate for resolution on summary judgment.

In 2016, Craig Bouchard founded Braidy Industries, Inc., a Delaware corporation with principal places of business in Kentucky and Massachusetts whose purpose is to manufacture efficient and eco-friendly aluminum alloys. Bouchard served as CEO, Chairman of the board of directors, and Secretary. The board also consisted of John Preston, Charles Price, Michael Porter, and Christopher Schuh. All members of the board were Braidy stockholders.

In 2018, Bouchard and the other directors entered into an Amended and Restated Voting Agreement. The directors and Bouchard executed the agreement in their capacity as stockholders. The board unanimously approved the agreement, and the agreement was referenced throughout the Braidy bylaws. The agreement specified that only persons who were nominated in accordance with the agreement were eligible for election as directors. The agreement also contained provisions regarding the removal of directors. Continue reading ›

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Over the coming weeks and months, employees will begin returning to work in increasing numbers across the state. As they do, employers will find themselves facing unique challenges created by the risk of workplace exposure to COVID-19. Potential transmission of COVID-19 by employees can create liability concerns for employers. The primary concern for employers is whether they will be entitled to the tort immunity typically provided by workers’ compensation laws in light of the unique nature of the COVID-19 pandemic. Far from being just a hypothetical concern, the first workplace COVID-19 exposure case in Illinois was filed a few weeks ago by the estate of an employee who passed away from complications of COVID-19.

Under many states’ workers’ compensation statutes, a claim under the state workers’ compensation system is the exclusive remedy for an employee who suffers a work-related injury. This is often referred to as the “workers’ compensation bar” or “exclusivity bar” and represents a trade-off for employers and employees. For employees, workers’ compensation laws make it easier for employees to recover from employers for workplace injuries. Many workers’ compensation laws are no-fault laws, meaning the employer must cover the employee’s injury even if it was not at fault for causing the injury. In exchange for lowering the threshold for recovery, the workers’ compensation laws usually prevent employees from suing their employer for additional compensation under a different legal theory for workplace injuries. Continue reading ›

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