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Callis, Papa, Jackstad & Halloran, P.C. v. Norfolk and Western Railway Company

April 19, 2001

CALLIS, PAPA, JACKSTADT & HALLORAN, P.C., APPELLEE,
v.
NORFOLK AND WESTERN RAILWAY COMPANY, APPELLANT.



The opinion of the court was delivered by: Justice Freeman

Docket No. 88306-Agenda 16-September 2000.

Plaintiff, Callis, Papa, Jackstadt & Halloran, P.C. (hereinafter, the law firm), sought injunctive relief in the circuit court of Madison County against defendant, Norfolk and Western Railway Company *fn1 (hereinafter, the railroad). The circuit court granted a preliminary injunction, and the railroad appealed. In a summary order, the appellate court affirmed the circuit court's judgment. No. 5-98-0756 (unpublished order under Supreme Court Rule 23). The railroad then filed a petition for leave to appeal (177 Ill. 2d R. 315(a)), which this court granted. For the reasons that follow, we now reverse the judgment of the appellate court.

BACKGROUND

The parties do not dispute the essential facts in this matter. The railroad is a corporation that operates trains and maintains track, rolling stock, and equipment in the southern Illinois region. Thomas R. Rush is a conductor in defendant's employ. Rush is a member of the United Transportation Union (UTU), and his employment is governed by a collective-bargaining agreement between the railroad and the UTU, as well as by the provisions of the federal Railway Labor Act (45 U.S.C. §151 et seq. (1994)). Under the terms of the collective-bargaining agreement, the railroad may only discipline a covered employee such as Rush after first conducting a fair and impartial investigation. In accordance with the agreement, an accused employee must be given written notice of the charges against him. The employee has the right to a hearing, at which he may have witnesses appear and testify on his or her behalf. At the hearing, the employee is permitted to be represented by a union official, but both the employee and the railroad are barred from having attorneys participate in the proceedings. The employee may appeal any discipline imposed through the established grievance procedure. If such an appeal is not resolved to the employee's satisfaction, the employee or the union representative may submit the dispute to arbitration as provided under the Railway Labor Act.

While on duty on August 12, 1998, Rush fell, landing on his right buttock and right leg. He declined the medical treatment offered by defendant's personnel and continued with his work. Several days later, Rush informed M.J. Wheeler, the railroad's assistant superintendent of terminals, that he was experiencing occasional pain. Rush requested to see a doctor and was transported to a health care center, where he was examined by Dr. Cheryl Patterson, who diagnosed the injury as a bruise to the right buttock and a strain to the right hamstring. Dr. Patterson prescribed over-the-counter ibuprofen and released Rush for return to full work duty.

On September 1, 1998, at approximately 3:40 p.m., the railroad's superintendent of terminals, D.L. Williams, spoke with Rush over the telephone. Williams asked Rush how he was feeling. Rush stated that he had not gotten any better. Rush explained that he was limping around on the job and was not able to perform his assignments. Williams told Rush that the railroad had scheduled a doctor's appointment for him at 10 a.m. the following day.

Approximately one hour after the phone conversation between Williams and Rush, Assistant Superintendent Wheeler observed Rush on duty from 5 to 6:15 p.m. During this period, Rush apparently was unaware of Wheeler's presence. Wheeler observed Rush throw approximately 10 to 12 switches and walk back and forth between switches at a brisk pace. Wheeler also saw Rush set and release handbrakes by mounting and dismounting tank cars. Wheeler watched Rush perform these tasks without any apparent difficulty and without any noticeable limp. At approximately 6:45 p.m., Wheeler saw Rush once more, with Rush again apparently unaware of Wheeler's presence. Rush performed tasks without a discernible limp and without difficulty. As Rush rounded the front of a locomotive, he saw Wheeler. At that point, he began to walk with a limp. Wheeler asked Rush how he felt. Rush stated that his leg was not getting any better. Wheeler thereafter reported his observations to Williams.

On the next day, September 2, Williams spoke with Rush at the clinic following the scheduled doctor visit. Rush limped and walked very slowly in Williams' presence. At the conclusion of the conversation, at 10:30 a.m., Williams informed Rush that he was taking Rush out of service because Williams had reason to believe that Rush was being dishonest about the extent of his physical condition and his ability to perform his duties. Williams intended that a complete factual record on this issue be developed so that the railroad could determine whether Rush had, in fact, engaged in conduct unbecoming a railroad employee and whether it would be appropriate to discipline him if such conduct were to be found to have occurred. The investigation was to be conducted pursuant to, and in accordance with, the collective-bargaining agreement.

At some point after the 10:30 a.m. conversation, Rush contacted the law firm. Later that afternoon, Lance Callis of the law firm wrote a letter to the railroad informing it that the firm had been retained by Rush to represent him "in a claim for damages" as a result of the August 12 accident. The letter advised the railroad that the law firm was claiming a reasonable contingent fee of any sums recovered by Rush. The letter closed by asking the railroad to "have no further contact with [Rush]."

On the next day, September 3, 1998, Superintendent Williams wrote a letter to Rush on behalf of the railroad, informing Rush in writing of the charges under investigation. According to the letter, the purpose of the investigation was "to determine [Rush's] responsibility, if any, in connection with conduct unbecoming a [railroad] employee in that [Rush] made false statements concerning the extent of [his] physical condition subsequent to an alleged personal injury at approximately 3:45 p.m. on Tuesday, September 1, 1998." The railroad scheduled the hearing to be held on September 9, 1998. The letter further identified three persons as witnesses and advised that others might be called.

On September 8, 1998 the law firm filed a verified complaint for injunction and temporary restraining order. In the complaint, the law firm alleged that, on September 2, 1998, it had entered into a contractual relationship with Rush and had determined that Rush had a claim against the railroad under the Federal Employers' Liability Act (FELA) (45 U.S.C. §51 et seq. (1994)). The law firm further alleged that it had filed a complaint against the railroad in the circuit court of Madison County. *fn2 According to the law firm, the disciplinary hearing scheduled by the railroad would subject Rush to questioning by railroad representatives concerning the accident for which the law firm represented Rush. The law firm claimed that the railroad was "attempting to question Rush outside the presence of his attorneys concerning the subject matter for which [the law firm] represents Rush in a separate action filed under the FELA." The law firm alleged that, unless restrained by the court, the railroad would interfere with the contractual relationship between the law firm and Rush and would interfere with the law firm's prospective economic advantage by forcing Rush to either subject himself to questioning and provide information regarding his FELA suit, without the firm's assistance, or risk immediate dismissal for failure to do so. This action, the law firm alleged, would cause it immediate and irreparable harm.

The law firm further claimed that the railroad's action would subject the law firm to immediate and irreparable harm due to the fact that the law firm had an ethical and contractual duty to represent its client fully and zealously. According to the firm, if the railroad were allowed to question Rush, then the law firm would be subject to potential malpractice and ethical charges. The law firm stated that the railroad's actions would harm the law firm due to the fact that the firm "had a prospective economic advantage" because of its employment relation with Rush. Moreover, the firm claimed that the railroad's attempt to interrogate Rush outside the presence of, and without the law firm's counsel, "would interfere with the firm's prospective economic advantage by preventing the law firm's legitimate expectancy from ripening into a valid business relationship." The law firm requested that the circuit court enter a temporary restraining order against the railroad and that the order be made permanent upon a final hearing.

The circuit court entered a temporary restraining order on the same day the verified complaint was filed. The court also set the matter for a preliminary injunction hearing, to be held one week later.

The railroad filed a memorandum in opposition to the law firm's application for a preliminary injunction. In it, the railroad maintained that the law firm failed to meet the requirements for a preliminary injunction because the allegations in the verified complaint did not establish the likelihood of the tortious interference claim's success on the merits. In response, the law firm argued that the railroad's position was not supported by Illinois law. The law firm cited to a decision of the appellate court, Callis, Papa, Jensen, Jackstadt & Halloran, P.C. v. Norfolk Southern Corp., 292 Ill. App. 3d 1003 (1997) (Callis I), in support of its cause of action. In that case, a Fifth District panel of the appellate court considered facts similar to the those advanced in the instant case and concluded that, under the circumstances, injunctive relief, based upon tortious interference, was proper.

At the hearing, the circuit court took judicial notice of the entire circuit court file in Callis I, including the pleadings and transcripts. The court granted the law firm a preliminary injunction in an order dated October 21, 1998. The court found that the law firm had established a clearly ascertained right in need of protection, a likelihood of success on the merits, and a lack of privilege. The court ruled that the law firm would suffer irreparable harm if the injunction did not issue and that the law firm lacked an adequate remedy at law. The railroad appealed. The appellate court affirmed the circuit court's order in an unpublished summary order, holding that the case at bar was indistinguishable from the issues and facts previously addressed in Callis I.

As noted above, this court allowed the railroad's petition for leave to appeal. We subsequently granted the following organizations leave to submit briefs as amici curiae: the Association of American Railroads, the Academy of Rail Labor Attorneys, and the Illinois Trial Lawyers Association. 155 Ill. 2d R. 345. Prior to oral argument, but after briefing in the matter had been concluded, the law firm moved to dismiss the appeal as moot. In its motion, the law firm indicated that the FELA litigation between Rush and the railroad had been settled and that Rush's complaint had been dismissed with prejudice. As such, the law firm contended that a real controversy between the parties no longer existed and that none of the exceptions to the mootness doctrine existed so as to allow appellate review. See Madison Park Bank v. Zagel, 91 Ill. 2d 231 (1982). The railroad objected to the motion, arguing that the case should be reviewed notwithstanding the ...


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