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Steines v. Menrisky

United States District Court, N.D. Illinois, Eastern Division

December 2, 2016

THOMAS J. STEINES, Plaintiff/Counter-Defendant,
v.
SUSAN MENRISKY, Defendant, and DONALD W. MENRISKY, Defendant/Counter-Plaintiff/Third-Party Plaintiff,
v.
SHERYL STEINES, Third-Party Defendant.

          MEMORANDUM OPINION AND ORDER

          Gary Feinerman Judge.

         Thomas Steines brought this suit against his former business partner, Donald Menrisky, and Menrisky's wife, Susan Menrisky. Doc. 1. The Menriskys have moved to disqualify attorney Thomas Griffin, and his firm, Walker Wilcox Matousek LLP (“WWM”), from representing Steines in this suit. Doc. 30. The motion is denied.

         Background

         No party requested an evidentiary hearing, so the Menriskys' motion may be resolved on the papers. See Cannon v. U.S. Acoustics Corp., 532 F.2d 1118, 1119-20 (7th Cir. 1976).

         In 1994, Steines-either alone or together with Donald-founded Simplesoft Solutions, Inc. Doc. 26 at 5 ¶ 8. Steines and the Menriskys were extensively involved with the company's operations and occupied seats on its board. Id. at 7 ¶¶ 14-15, 51-52 ¶¶ 14-15. Steines and Donald each own 50% of the company's shares. Id. at 3 ¶ 3, 4 ¶ 4.

         In 2010, Simplesoft sued Collier Computer Company and obtained a favorable settlement. Id. at 9 ¶ 24. WWM and Griffin represented Simplesoft in that suit. Id. at 25-26 ¶ 84. After the settlement, Griffin took Steines and Donald to dinner and drinks. Ibid.

         At some point, the relationship between Steines and the Menriskys soured. One disagreement concerned whether and, if so, on what terms the Menriskys would buy Steines out of his Simplesoft shares. Id. at 10 ¶¶ 28-29, 11 ¶ 31, 23 ¶ 75, 58 ¶ 36. Another concerned the Menriskys' access to the company's QuickBooks file. Id. at 17-20 ¶¶ 54-63. At some point, Donald terminated Steines's health insurance. Id. at 24-25 ¶¶ 80-83. This action prompted Griffin to send Donald this email on June 13, 2016:

As you may recall, my firm acts as outside legal counsel for Simplesoft. We represented Simplesoft, for example, in connection with the lawsuit Simplesoft filed against Collier Computing Company in the United States District Court for the Northern District of Illinois. You and I met in person when I took you and Tom Steines out for dinner and drinks after we obtained a favorable settlement for Simplesoft in that action.
Mr. Steines, in his capacity as president of Simplesoft, has asked me to provide an opinion to Simplesoft regarding your threats to cause Simplesoft to terminate his medical insurance coverage.
Mr. Steines also has us looking into some other issues on behalf of Simplesoft, including your and Susan Menrisky's representations and reports that Simplesoft has not been generating any sales or collecting its outstanding receivables. Mr. Steines and Simplesoft have reason to believe those representations by you and Susan Menrisky are false. We are in the process of finalizing a Complaint for Injunctive and Other Relief to enjoin diversions of Simplesoft's sales and receipts, as well as to obtain an accounting and other relief for such misconduct.

Id. at 25-26 ¶ 84.

         Shortly thereafter, Steines and Simplesoft filed this suit against the Menriskys. Doc. 1. The Menriskys answered, and Donald counterclaimed against Steines and filed a third-party claim against Steines's wife, Sheryl Steines. Doc. 26. The Menriskys then moved to disqualify Griffin and WWM as counsel for Steines and Simplesoft. Doc. 30. This prompted the voluntary dismissal of Simplesoft as a plaintiff, Doc. 36, and Griffin later confirmed on the record that he no longer represented Simplesoft. The Menriskys' motion to disqualify Griffin and WWM as counsel for Steines remains for disposition.

         Discussion

         Disqualification is “a drastic measure which courts should hesitate to impose except when absolutely necessary.” Freeman v. Chi. Musical Instrument Co., 689 F.2d 715, 721 (7th Cir. 1982); see also Schwartz v. Cortelloni, 685 N.E.2d 871, 877 (Ill. 1997) (“Attorney disqualification is a drastic measure because it destroys the attorney-client relationship by prohibiting a party from representation by counsel of his or her choosing.”); Storino, Ramello, and Durkin v. Rackow, 45 N.E.3d 307, 314 ( Ill. App. 2015) (same). The movant bears the burden of showing that disqualification is warranted. See Gov't of India v. Cook Indus., Inc., 569 F.2d ...


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