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12/09/97 ALAN P. JACOBSON v. KNEPPER AND MOGA

December 9, 1997

ALAN P. JACOBSON, PLAINTIFF-APPELLEE,
v.
KNEPPER AND MOGA, P.C., DEFENDANT-APPELLANT.



Appeal from the Circuit Court of Cook County. Honorable Kenneth Gillis, Judge Presiding.

Released for Publication January 22, 1998.

The Honorable Justice McNULTY delivered the opinion of the court. Tully and Frossard, JJ., concur.

The opinion of the court was delivered by: Mcnulty

The Honorable Justice McNULTY delivered the opinion of the court:

Plaintiff-appellee, Alan P. Jacobson (Jacobson), an attorney licensed to practice in the State of Illinois, brought this action against the law firm of Knepper and Moga, P.C. (Knepper), seeking damages for injuries resulting from his wrongful discharge from the firm. The one-count complaint sought compensatory and punitive damages.

Jacobson's complaint alleged that on July 14, 1994, he was hired as an associate of Knepper, and in August of that year he discovered the firm was filing consumer debt collection actions in Cook County, Illinois, in violation of the venue provisions of the Fair Debt Collection Practices Act, (15 U.S.C. ยง 1692i(a)(2)(B) (1988)) and the Illinois Collection Agency Act (225 ILCS 425/9(20) (West 1994)). He further alleged that in August of 1994, he spoke with James Knepper, one of the law firm's principal partners, about this problem and was advised it would be corrected.

The complaint further recited that in April of 1995, he was promoted to the position of office manager, reporting directly to the firm's partners. In his new position Jacobson was placed in charge of training and supervising the law firm's collection department. Additionally, as a licensed attorney, Jacobson was asked to review all draft complaints filed in consumer debt collection cases and sign them for filing purposes. Shortly thereafter, Jacobson learned that the firm was continuing to file debt collection actions in violation of the venue provisions of the acts referred to above. He again brought the matter to the attention of Mr. Knepper, who again told him the matter would be rectified. Within a short while, Jacobson was relieved of his responsibility to review and sign complaints in these cases.

About 10 weeks later Jacobson learned that the improper venue filing practices had not ceased and that complaints he had previously refused to sign had been filed. For the third time he brought the matter to Mr. Knepper's attention and was again told that the matter would be taken care of. About two weeks later Jacobson was terminated, resulting in this cause of action for retaliatory discharge, alleging on information and belief that he had been terminated in retaliation for his insistence that the law firm cease violating the venue provisions of the Fair Debt Collection Practices Act.

After Knepper filed an answer to Jacobson's complaint and a motion to dismiss, the trial court certified the following question of law pursuant to Supreme Court Rule 308 (134 Ill. 2d R. 308):

"Do the holdings in Herbster v. North American Co. for Life & Health Insurance, 150 Ill. App. 3d 21, 501 N.E.2d 343, 103 Ill. Dec. 322 (1st Dist. 1986) and Balla v. Gambro, Inc., 145 Ill. 2d 492, 584 N.E.2d 104, 164 Ill. Dec. 892 (1991) prevent an attorney licensed to practice in the State of Illinois from maintaining a cause of action for the tort of retaliatory discharge against his non-client law firm employer due to the pre-eminence of the Rules of Professional Conduct?"

Defendant's petition for leave to appeal to the appellate court pursuant to Rule 308 was denied. Defendant then filed an affidavit of intent to seek leave to appeal to the Supreme Court of Illinois pursuant to Supreme Court Rule 315 (134 Ill. 2d R. 315).

The supreme court denied defendant's petition for leave to appeal, but in so doing issued a supervisory order directing this court to allow defendant's previously filed petition for leave to appeal pursuant to Rule 308 and to consider the appeal on its merits. It is pursuant to that order that we review this matter.

We conclude that neither the holding in Herbster, as interpreted by the supreme court in Balla, nor the holding in Balla itself, precludes an action for retaliatory discharge by Jacobson against his employer, Knepper, on the facts alleged in the complaint. We therefore affirm the trial court.

Knepper asserts that Balla precludes an attorney from bringing an action for retaliatory discharge against his law firm employer for its actions in continuing to file law suits that he alleged violated the venue provisions of both federal and state debt collection statutes. Knepper claims that the public interest could adequately be protected by reporting such practices to the Attorney Registration and Disciplinary Commission (ARDC) as the Code of Professional Responsibility (107 Ill. 2d R. 1-103) requires. At oral argument counsel for Knepper asserted that the in-house counsel status of the discharged lawyers in Herbster and Balla was of no legal consequence and that any attorney was ...


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