In the realm of defamation law, the distinction between public and private figures holds significant weight. Public figures have a higher burden of proof when pursuing defamation claims due to their assumed access to media platforms and the assumed public interest in their lives or opinions. However, what happens when someone becomes an involuntary public figure, particularly in the context of Illinois law?

In Illinois, as in many other jurisdictions, individuals may become involuntarily thrust into the public eye due to circumstances beyond their control. The legal concept of involuntary public figures was established in the famous case of involving a well known Illinois lawyer Elmer Gertz. This case sets out the framework for the doctrine: Justice Mikva in DC federal  appeals decision, Dameron v. Washington Magazine, Inc., 779 F.2d 736, 742 (D.C. Cir. 1985) provides a very good description of the doctrine:

By sheer bad luck, Dameron happened to be the controller on duty at the time of the Mt. Weather crash. As in Gertz, Dameron “assume[d a] special prominence in the resolution of [a] public question[ ].” Gertz at 351, 94 S.Ct. at 3012. He became embroiled, through no desire of his own, in the ensuing controversy over the causes of the accident. He thereby became well known to the public in this one very limited connection. The numerous press reports on the Mt. Weather crash introduced by the defendants in their motion for summary judgment amply demonstrate this. Dameron’s name and likeness were often used in these reports. See R.E. at 134–49 (reproducing articles from The Washington Post, The Star-News, UPI and the PATCO Newsletter). It was in that same very limited connection that The Washingtonian’s brief and oblique reference to him surfaced years later.
Paradoxically, the magazine article never mentions Dameron’s name or other identifying characteristics. If Dameron had not been previously linked with accounts of the tragedy, no magazine reader could tie the alleged defamation to Dameron. Indeed, it was partly because of the defendant’s public notoriety that he was identifiable at all from the oblique reference in The Washingtonian.
There is a marked contrast between the controlling facts of this case and the facts of Time, Inc. v. Firestone, 424 U.S. 448, 96 S.Ct. 958, 47 L.Ed.2d 154 (1976), a case Dameron claims shows that he was not a public figure. Indeed, Firestone butresses our conclusion that Dameron is a public figure for the limited purpose of discussion of the Mt. Weather crash. In Firestone the scion of a prominent family of industrialists was sued for divorce. The charges and countercharges in the suit were sensational and the press displayed a great deal of interest in the proceedings. The Court, however, declined to find Mrs. Firestone even a limited-purpose public figure merely because of her much-publicized divorce trial. The Court found that Mrs. Firestone’s resort to the judicial process to arrange her marital affairs was, for all practical purposes, involuntary and that the controversy, if any, over her marriage and divorce was a private one. Id. at 454–55, 96 S.Ct. at 965–66. The Court said that “even though the marital difficulties of extremely wealthy individuals may be of interest to some portions of the reading public” a divorce proceeding was not a public controversy. Id. at 454, 96 S.Ct. at 965. That is, public interest in a controversy does not make a public controversy. The newsworthiness of an event is not the measuring stick for identifying public controversy. Nor is a voyeuristic interest in someone’s private affairs an appropriate substitute. Dameron’s situation, however, is far removed from that of Mrs. Firestone. Dameron was at the center of a controversy involving the loss of many lives in a mishap involving a public carrier. At issue was the management of a program administered by the FAA, an arm of the government. Another governmental agency—the NTSB—conducted an extensive, public investigation into the events surrounding the Mt. Weather Crash. Dameron appeared at these hearings and testified for many hours about his role in the crash. The hearings, and Dameron’s role in them, were widely publicized. We think that, like it or not, Dameron was embroiled in a public controversy.

The Illinois courts or federal courts interpreting Illinois law, like other courts around the country, have recognized that some individuals, despite being private citizens, can become involuntarily involved in public controversies or discussions. In these situations, they may temporarily take on the role of a public figure for the limited context of that particular controversy. For instance, someone who becomes part of a widely covered news story or controversy, such as a victim of a high-profile crime or a witness to a significant event or a reputed mobster who has a high profile and been indicted but not convicted, might be considered an involuntary public figure for the duration or context of that particular issue.

However, meeting the criteria for involuntary public figure status is not a simple task. The courts evaluate various factors, such as the extent of media coverage, the person’s role in the events, and whether the individual has voluntarily sought public attention. Additionally, the Illinois courts consider whether the allegedly defamatory statements are related to the public controversy that led to the individual’s involuntary public figure status.

Despite being classified as an involuntary public figure, individuals in Illinois are not stripped of all protection against defamation. They still possess the right to seek legal recourse if defamatory statements are made about them. However, the burden of proof or the elements needed to be proved (i.e. wilful or intentional disregard of the truth) may be higher compared to that of a private individual due to the limited-purpose public figure status they’ve acquired.

It’s essential to understand that defamation law can be intricate, and each case is evaluated on its unique circumstances. If you believe you’ve been the subject of defamatory statements in Illinois, seeking legal counsel to assess your situation is crucial. Understanding the nuances of involuntary public figure status and how it pertains to defamation law can significantly impact the outcome of a case.

In conclusion, Illinois recognizes the concept of involuntary public figures and provides certain protections in defamation cases. The courts carefully analyze the circumstances surrounding an individual’s involvement in a public controversy to determine their status. If you find yourself in such a situation, consulting a legal professional who specializes in defamation law is advisable to navigate these complexities effectively.

You can read an interesting law review article on the topic here.

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In the digital age, where information spreads rapidly across various platforms, businesses are susceptible to reputational harm through false statements or misleading information. Business libel, a form of defamation, can significantly impact a company’s reputation, credibility, and ultimately, its bottom line. Understanding what constitutes business libel and how to protect your business is crucial in safeguarding its reputation.

What is Business Libel?

Business libel refers to false and damaging statements or representations made about a business, its products, services, or practices. This defamation can occur through various mediums such as online reviews, social media posts, articles, or spoken statements. These false statements can negatively impact the company’s brand image, customer trust, and even its relationships with stakeholders.

Elements of Business Libel:

For a statement to be considered libelous against a business, it typically must fulfill the following criteria:

  1. False Statement: The statement in question must be untrue or misleading.
  2. Publication: The false statement must be communicated to a third party, whether through written, spoken, or digital means.
  3. Harm: The false statement must have caused or have the potential to cause harm to the business’s reputation or financial standing.
  4. Negligence or Intent: In some cases, proving that the false statement was made either negligently or with malicious intent can strengthen a business’s libel claim.

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The duty of oversight, often referred to within the context of corporate governance, is a critical aspect of the responsibilities of a corporation’s board of directors. This duty is essentially the requirement that board members are attentive to and oversee the business and affairs of the corporation, including its compliance with the law and its risk management processes. The duty of oversight is a component of the fiduciary duties that directors owe to the corporation and its shareholders.

The case In re McDonald’s Corp. S’holder Deriv. Litig., 2023 WL 387292, C.A. No. 2021-0324-JTL, at *1, *9 (Del. Ch. Jan. 26, 2023) is centered around allegations that the McDonald’s directors overlooked signs of a corporate culture permitting sexual harassment and misconduct from 2015 to 2020. The plaintiffs, who are shareholders, contend that this resulted in harm to the company due to subsequent employee lawsuits, loss of employee trust, and a damaged reputation. Nine directors who served during this period were named as defendants.

David Fairhurst, who served as Executive Vice President and Global Chief People Officer of McDonald’s from 2015 until his termination in 2019, was among the defendants. The plaintiffs argued that Fairhurst, as a fiduciary, was aware of potential issues with sexual harassment and misconduct in the company. They claimed that under his leadership, a culture of sexual misconduct and harassment was allowed to develop, leading to coordinated Equal Employment Opportunity Commission (EEOC) complaints, a 30-city walkout, and a second round of coordinated EEOC complaints, followed by a second one-day strike in 10 cities.

To fully grasp how this case has impacted Delaware Law concerning the duty of oversight, it is essential to understand the concept of a Caremark claim. This type of “failure of oversight” theory is observed to be one of the most challenging theories in corporation law upon which a plaintiff might hope to win a judgment. Under Delaware law, plaintiffs must plead with particularity that there were so-called ‘red flags’ that put the directors on notice of problems with their systems, but which were consciously disregarded. Continue reading ›

In today’s digital age, where information spreads at the speed of light and opinions are shared freely, libel, defamation, and internet slander have become increasingly common issues. When your reputation is at stake, it’s crucial to understand the complexities of libel law and the defenses available to protect your rights. This blog post aims to shed light on this intricate area of law and the importance of seeking expert legal counsel, exemplified by Lubin Austermuehle, a law firm with decades of experience in handling libel and defamation cases for a diverse range of clients.

The First Amendment: Balancing Rights and Responsibilities

At the heart of libel law in the United States lies the First Amendment to the Constitution, which protects freedom of speech. This fundamental right, however, is not without limits. While individuals have the right to express their opinions, they are also responsible for the consequences of their words, particularly when they cause harm to someone’s reputation. Continue reading ›

In 2023, there were several significant developments in Illinois civil case law.

The case of “PPP-SCH Inc. v. SVAP Hoffman Plaza, L.P.” clarified that a voluntary dismissal disposing of all remaining claims in a case makes appealable those orders preceding the voluntary dismissal that were “final in nature”. However, this ruling was later modified and superseded on denial of rehearing by the same case.

In “Disability Services of Illinois v. Department of Human Services”, the court allowed the transfer and consolidation of a civil rights case and an administrative review case for the sake of convenience and efficiency due to the similarity of legal and factual issues in both cases.

“Wilson v. Estate of Burge” highlighted that claims under Illinois law for intentional infliction of emotional distress and civil conspiracy were subject to a one-year statute of limitations under the Illinois Local Governmental and Governmental Employees Tort Immunity Act. Furthermore, the court found that a suspect who was wrongfully convicted based on a confession procured by torture, sufficiently pleaded that an assistant state’s attorney engaged in extreme and outrageous conduct, as required to state a claim for intentional infliction of emotional distress.

The “City of Chicago v. SBR Revocable Living Trust” case was notable for the dismissal of an appeal as moot due to a subsequent order.

Additionally, the court’s interpretation of jurisdiction in “In re K.F.” gave clarity on appeals from final judgments in civil cases and cases arising under the Juvenile Court Act. In “Hernandez v. Illinois Institute of Technology”, the court provided guidance on how to apply Illinois law to unprecedented circumstances like the disruption of traditional university operations caused by the COVID-19 pandemic.

Finally, “Doe v. Burke Wise Morrissey & Kaveny, LLC” resulted in the reversal of an appellate court judgment and affirmation of a circuit court judgment, demonstrating the Supreme Court’s role in shaping Illinois civil case law. Continue reading ›

In Illinois, damages for inconvenience and aggravation can be claimed in cases of fraud and consumer fraud, but there are important conditions to consider. Under the Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA), plaintiffs can assert damages stemming from the defendant’s conduct, which can include emotional damages such as aggravation and inconvenience. These types of damages are recoverable under the ICFA only if they are part of a total award that includes actual economic damages.

The Act primarily provides remedies for economic injuries. Actual damages under the ICFA encompass the diminished value of goods or services such as the car was worth far less than the purchase price because it was a rebuilt wreck.  Such damages as in any tort or breach of contract case cannot be based on mere speculation or conjecture but if the defendant’s wrongdoing makes it difficult to calculate more leeway is permitted and damages can always be based on a reasonable valuation or estimate which is data or information driven. The plaintiff must demonstrate that the fraud proximately caused these damages. Hence, if inconvenience, aggravation, and inconvenience damages are the only damages alleged, they are generally not recognized.

In the context of fraud claims, damages for emotional distress, including “aggravation and inconvenience”, are recognized only when the inflicted distress would mean that it would cause a reasonable person under the circumstances such damages.

Lastly, punitive damages, which are awarded in cases of wilful and egregious behavior by the defendant, are also available for a violation of the ICFA. Continue reading ›

Buying a used car, truck, or SUV should be an exciting experience, but all too often, consumers find themselves facing fraud and deceptive practices by unscrupulous auto dealers. When you’re caught in the web of auto dealer fraud, it’s crucial to have a skilled and experienced Illinois Consumer Rights Lawyer by your side. Why? Because these cases involve complex machines, intricate laws with numerous pitfalls, and a deep understanding of the Illinois Consumer Fraud and Deceptive Business Practices Act. At our Auto Dealer Fraud Firm, we possess the experience and knowledge you need, having successfully handled hundreds of auto fraud cases and even taken many Consumer Fraud Cases to federal and state appellate courts in Illinois and across the nation.

The Complexity of Auto Dealer Fraud Cases

Used vehicles are intricate machines with countless components and systems, making it challenging for the average consumer to detect hidden issues or fraudulent practices. This complexity is compounded by the fact that auto dealer fraud cases often involve a web of deceptive tactics, such as odometer rollbacks, undisclosed accidents, or hidden defects.

The Legal Pitfalls

Navigating auto dealer fraud cases requires a deep understanding of the legal landscape, including state and federal consumer protection laws. In Illinois, the Illinois Consumer Fraud and Deceptive Business Practices Act (ICFA) plays a central role in protecting consumers from unfair and deceptive practices. However, pursuing a claim under ICFA can be legally complex and rife with pitfalls.

Here are some of the legal challenges you may encounter:

  1. Proving Intent is Not Necessary for Misrepresentations: Intent is not needed for fraud claims under the ICFA involving misrepresentations and dealers are strictly liable for material misstatements even if they were for instance unaware of accident or flood damages.  However intent needs to be proven for material commissions and we have expert witnesses and other methods for establishing such intent including obtaining car auction records
  2. Establishing Material Misrepresentation: It’s not enough to show that a misrepresentation occurred; it must also be proven that the misrepresentation was material, meaning it had a significant impact on your decision to purchase the vehicle.
  3. Navigating Arbitration Clauses: Many dealer contracts include arbitration clauses, which can complicate the legal process. An experienced attorney can help you navigate these clauses to protect your rights.
  4. Statute of Limitations: There are strict deadlines for filing auto dealer fraud claims, and missing these deadlines can result in the loss of your right to pursue a case.

Why Our Auto Dealer Fraud Firm is the Right Choice

When facing auto dealer fraud, you need a legal team that not only understands the complexities of the vehicles but also has a proven track record in handling these cases. At our Auto Dealer Fraud Firm, we have the experience you can trust. Here’s why you should choose us:

  1. Extensive Experience: We have successfully handled hundreds of auto fraud cases, gaining invaluable insights and expertise along the way.
  2. Appellate Experience: We’ve taken Consumer Fraud Cases to federal and state appellate courts in Illinois and throughout the country, showcasing our dedication to achieving justice for our clients.
  3. In-Depth ICFA Knowledge: We are well-versed in the Illinois Consumer Fraud and Deceptive Business Practices Act, ensuring that your case is handled with precision and expertise.
  4. Proven Results: Our track record of securing favorable outcomes for clients speaks for itself.

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Recent Illinois law regarding the defense of officers and directors of corporations and LLCs encompasses several key factors:

1. Fiduciary Duties: Officers and directors of corporations and LLCs are fiduciaries, holding duties of good faith, loyalty, and honesty to the corporation. They are not permitted to enhance their personal interests at the expense of the corporation’s interests, and should not be in a position where their own individual interests might interfere with their duties to the corporation.

2. Business Judgment Rule: Under the business judgment rule, a presumption exists that corporate decisions made by an officer or director are made on an informed basis and with an honest belief that the action was in the corporation’s best interests. This presumption can be rebutted by allegations that a director acted fraudulently, illegally, or without sufficient information to make an independent business decision [3].

3. Contractual Obligations: Illinois law provides officers of a corporation with a qualified privilege against liability for tortious interference with a contract with the corporation. To overcome this privilege, the plaintiff must assert and plead that the corporate officers acted with malice and without justification.

4. Piercing the Corporate Veil: Generally, corporate officers and directors are not personally liable for the corporation’s actions, as corporations are considered distinct legal entities separate from their officers, shareholders, and directors. However, under certain circumstances, the corporate veil can be pierced to hold officers and directors personally responsible, such as when there is such unity of interest and ownership that the separate personalities of the corporation and the individual no longer exist, or adherence to the fiction of separate corporate existence would sanction fraud or promote injustice.

5. Specifics for LLCs: In the context of LLCs, allegations that officers and directors disguised equity contributions as loans, enabling the company to make interest payments to insiders during a time when the company was either insolvent or undercapitalized, could be sufficient to state a claim for breach of fiduciary duty under Illinois law.

These principles form the foundation of a defense for corporate officers and directors in Illinois. Continue reading ›

In the case of “State Auto Property & Casualty Insurance Co. v. Bell & Arthur Condominium Association”, it was held that the insurer did not have a duty under Illinois law to defend the association, directors, and officers in an action regarding alleged defamation per se and property damage, as these alleged offenses occurred outside the policy period.

Regarding the duties of condominium associations, the “Westfield Insurance Company v. National Decorating Service, Inc.” case noted that under the Illinois Condominium Property Act, a condominium association may act in a representative capacity on behalf of its unit owners. However, the Act limits such representation to matters involving the common elements or more than one unit. This limitation precludes the Association from pursuing a legal remedy for damage caused to the individual unit owners’ furniture. Thus, these allegations were insufficient to invoke the insurer’s duty to defend.

The case of “Palm v. 2800 Lake Shore Drive Condominium Ass’n” highlighted that the Condominium Property Act regulates the creation and operation of Illinois condominium associations. The Act also defines “meeting of board of managers” and provides certain requirements for an association’s bylaws.

In “Truck Ins. Exchange v. Cassady”, the Condo Association sued the Developer and the officers for alleged construction defects. The court also discussed the insurance policy period about the claims.

The “Davis v. Dyson” case confirmed that unit owners in a condominium association could bring a derivative breach of fiduciary duty action against former directors. In contrast, the “Poulet” case found that causes of action for conversion and common law constructive fraud relating to an association’s account belong exclusively to that association, leaving unit owners with limited legal recourse.

In sum, the recent developments in Illinois law highlight the importance of insurance coverage periods in determining the duty to defend, restrictions on the representative capacities of condominium associations, the right of unit owners to bring lawsuits, and compliance with regulations under the Illinois Condominium Property Act. Continue reading ›

The legal landscape for Officers and Directors of Illinois corporations and LLCs is constantly evolving. Recent developments in laws, regulations, and court decisions have significant implications for the responsibilities and liabilities of board members. At Lubin Austermuehle, we are committed to staying ahead of these changes to provide our clients with the best possible defense. In this blog post, we’ll explore some of the recent developments in defending Officers and Directors of corporations and LLCs in Illinois.

1. Enhanced Scrutiny of Fiduciary Duties

In recent years, Illinois courts have heightened their scrutiny of the fiduciary duties owed by Officers and Directors of corporations and LLCs. These fiduciary duties include the duty of care and the duty of loyalty. Directors are expected to act in the best interests of the company and its shareholders, and any breaches of these duties can lead to legal action.

2. Clarifications on the Business Judgment Rule

The business judgment rule is a legal principle that provides some protection to Officers and Directors for their decisions made in good faith and in the best interests of the company. Recent developments in Illinois have clarified the application of this rule, emphasizing the importance of proper decision-making processes and documentation.

3. Increased Shareholder Activism

Shareholder activism is on the rise, and Directors and Officers are facing greater scrutiny from shareholders. In response, Illinois law has evolved to address the rights and powers of shareholders, particularly in closely held corporations and LLCs. It’s crucial for Officers and Directors to be aware of these changes and to engage in transparent communication with shareholders.

4. Cybersecurity and Data Privacy Concerns

The digital age has brought new challenges to the forefront, including cybersecurity and data privacy. Directors and Officers are now responsible for overseeing the protection of sensitive information and responding to data breaches appropriately. Failure to do so can result in legal action and regulatory penalties.

5. Environmental and Social Governance (ESG) Issues

ESG issues, such as environmental sustainability and social responsibility, are gaining prominence in the corporate world. Directors and Officers must consider these factors when making decisions, as they can impact the company’s reputation and risk exposure. Staying informed about ESG developments is vital. Continue reading ›

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