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Merrilees v. Merrilees

Court of Appeals of Illinois, First District, Sixth Division

September 27, 2013

PAMELA MERRILEES, Plaintiff-Appellant,

Held [*]

In an action arising from the dissolution of plaintiff’s marriage to defendant, the trial court properly dismissed with prejudice plaintiff’s amended complaint for civil violations of the Racketeer Influenced and Corrupt Organizations Act, fraud, civil conspiracy, and legal malpractice based on the conduct of her former husband, his attorneys, her attorneys and her ex-fiancé in connection with the settlement of the dissolution action, since plaintiff failed to sufficiently plead any of the causes of action she alleged.

Appeal from the Circuit Court of Cook County, No. 10-L-50345; the Hon. Kathy M. Flanagan, Judge, presiding.

Law Office of Nishay K. Sanan (Nishay K. Sanan, of counsel) and Thompson Coburn LLP (J. David Duffy, Susan M. Lorenc, and Brittany E. Kirk, of counsel), both of Chicago, for appellant.

Much Shelist, P.C., of Chicago (Warren Lupel and Jonathan L. Loew, of counsel), for appellees Robert Merrilees, James Rubens, and Davis Friedman, LLP.

Hinshaw & Culbertson LLP, of Chicago (Stephen R. Swofford, Thomas P. McGarry, and Terrence P. McAvoy, of counsel), for appellees Donald Casey, Gary Dienstag, and Springer, Casey & Dienstag, P.C.

Kralovec Meenan, LLP, of Chicago (Daniel C. Meenan, Jr., of counsel), for appellee Stuart Litwin.

Erin S. Sander, of Morton Grove, for appellee Matthew Casey.

Presiding Justice Rochford and Justice Hall concurred in the judgment and opinion.



¶ 1 After reaching a negotiated settlement with her ex-husband in their dissolution of marriage case, plaintiff Pamela Merrilees sued her former attorneys, her ex-husband, her ex-husband's attorneys, and her ex-fiancé for alleged damages arising out of the settlement of that case. After the trial court gave plaintiff five chances to state a cause of action against any of the defendants, the trial court, pursuant to section 2-615 of the Code of Civil Procedure (Code) (735 ILCS 5/2-615 (West 2010)), dismissed with prejudice plaintiff's fourth amended complaint.

¶ 2 Plaintiff appeals the dismissal of her complaint, contending she has pled factually and legally sufficient claims of civil violations of the Racketeer Influenced and Corrupt Organizations Act (RICO) (18 U.S.C. § 1962 (2006)), fraud, civil conspiracy, and legal malpractice against the defendants.

¶ 3 For the reasons that follow, we affirm the judgment of the trial court.


¶ 5 Plaintiff and defendant Robert Merrilees were married in 1993 and had three children. In 1999, Robert formed Spot Trading, LLC (Spot). In 2005, plaintiff filed a petition for dissolution of marriage. During the parties' negotiations concerning their marital settlement agreement (MSA), Robert argued that Spot constituted nonmarital property because his investment in Spot was traceable back to his premarital property, his share of the current book value of Spot grew out of his nonmarital stake in Spot without the addition by Robert of further contributions, and the marital estate was more than adequately compensated for his marital work by distributions to Robert from Spot and its predecessors.

¶ 6 In February 2009, plaintiff and Robert executed an MSA that allocated to plaintiff $18 million and the marital home valued at more than $1 million tax free. In the MSA, plaintiff and Robert stipulated that they had disputed the value of Spot, but plaintiff was advised by her own expert concerning that expert's opinion of the value of Spot, and she was satisfied with the valuation she received. The MSA allocated Spot to Robert, and plaintiff disclaimed any interest she had in the firm in exchange for the $18 million cash payment. After plaintiff gave sworn testimony at the prove-up hearing, the trial court approved the terms of the MSA and incorporated the MSA into a judgment for dissolution of marriage. Robert had sought sole custody of the children but, in April 2009, plaintiff and Robert executed a joint parenting agreement that provided for joint custody.

¶ 7 In June 2009, plaintiff reached a settlement agreement with some of her divorce attorneys, i.e., Litwin, Dienstag, and Dienstag's firm, concerning their legal fees in the divorce proceeding. The parties agreed to readjust the total sum of attorney fees from $3 million to $1.5 million. Plaintiff released and discharged Litwin, Donald Casey, Dienstag, and Springer, Casey & Dienstag, P.C., from all claims and damages of whatever nature or kind to date arising out of or in any way connected to the attorneys' compensation for legal fees and costs in connection with the representation of plaintiff in the divorce proceedings, including, but not limited to, claims for negligence or wrongdoing of any kind, misconduct related to the attorneys' compensation, or claims for refunds of money previously paid by plaintiff, who had not yet asserted any claim of professional negligence against the attorneys arising out of their legal services performed in the divorce proceedings.

¶ 8 In January 2010, plaintiff filed a petition to vacate the judgment for dissolution and the MSA pursuant to section 2-1401 of the Code (735 ILCS 5/2-1401 (West 2008)). Plaintiff alleged that her attorneys, her ex-fiancé, her ex-husband and his attorneys colluded to get her to sign the MSA and joint parenting agreement in order to enrich themselves, deprive plaintiff of her equitable share in the marital estate, and exclude her from the lives of her children. Specifically, she alleged that the defendants engaged in deception and fraud by understating the value of Spot and falsely informing her that Spot was nonmarital property. Robert's motions to dismiss plaintiff's section 2-1401 petition were granted, but the trial court granted plaintiff leave to amend. In December 2010, the trial court granted plaintiff's motion for a voluntary dismissal of her section 2-1401 petition, without prejudice.

¶ 9 Meanwhile, in February 2010, plaintiff filed the case at issue in this appeal against defendants: plaintiff's former divorce attorneys Donald Casey, Gary Dienstag, Springer, Casey & Dienstag, P.C., and Stuart Litwin; her ex-husband Robert and his attorneys James Rubens and Davis Friedman, LLP; and her ex-fiancé Matthew Casey. Defendants' section 2-615 motions to dismiss for insufficient pleading were granted, but the trial court gave plaintiff four opportunities to amend her original complaint. In March 2012, plaintiff filed against the defendants a 10-count fourth amended complaint seeking damages arising out of the handling of her divorce. She alleged the defendants conspired together to defraud her out of a higher divorce settlement and her attorneys' negligence caused her to receive a lower divorce settlement.

¶ 10 Specifically, plaintiff alleged civil RICO violations against all defendants (counts I and II); fraud in the inducement against Robert, Rubens and Davis Friedman, LLP (count III); fraud in the inducement against Litwin, Donald Casey, Dienstag and Springer, Casey & Dienstag, P.C. (count IV); fraud against Matthew and Donald Casey (count V); conspiracy against all defendants (count VI), and legal malpractice against Litwin, Dienstag, Donald Casey and Springer, Casey & Dienstag, P.C. (counts VII through X). The fourth amended complaint alleged the defendants knew that the statements in Robert's asset list and other documents were false, but defendants used them to defraud plaintiff and induce her to accept the MSA. She alleged that her own lawyers asked Robert's lawyers to prepare documents which indicated that Spot was not marital property and that she was not entitled to any proceeds from Spot.

ΒΆ 11 Defendants filed separate but similar section 2-615 motions to dismiss, contending that plaintiff failed to add any factual allegations to her fourth amended complaint and, thus, failed to correct any deficiencies in her prior pleadings. They argued that the fourth amended complaint continued to fail to properly allege the claims for RICO violations, fraud, civil conspiracy, and legal malpractice. In addition, several defendants argued the pleading was ...

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