Stack suggests splitting class in two for dueling law firms

Steve Korris Jun. 28, 2007, 11:00am

Madison County Circuit Judge Daniel Stack, handling a suit with plaintiffs whose attorneys have sued each other, suggested splitting the case in two.

For the moment the case offers another arena for the struggle between the Lakin Law Firm and former Lakin attorney Richard Burke.

At a June 12 hearing in a proposed class action, Burke and Jon Piper of the Lakin firm argued different claims for their clients.

Stack said, "Is it appropriate that these be together in two subclasses or would it be more appropriate for them to be separate lawsuits?"

Neither Burke nor Piper responded.

"It almost appears to me as though we are really gumming up," Stack said. "I mean, these are complicated cases anywhere.

"We have these two plaintiffs in the same lawsuit where we are going to say it is one big class but these are two huge subclasses.

"I'm not sure if they shouldn't be two separate classes, assuming you reach the point where they are certified."

Burke responded that parties don't all agree.

Burke left the Lakin firm last year. He sued the firm in U.S. District Court this year, claiming he did not receive fees he earned.

Burke opened an office in St. Louis. He has associated with a Chicago class action firm, Freed & Weiss.

While Burke switched from the Lakins to Freed & Weiss, Piper did the opposite. He left Freed & Weiss to join the Lakins.

The firms worked together in Madison County for seven years but this year they sued each other for control of suits they filed together.

Freed & Weiss has withdrawn from many suits at the request of Lakin clients, while reserving the right to seek remedies.

In the case that came before Stack, lead plaintiff Sallie Lewis chose the Lakins and plaintiff Maria Hernandez chose Freed & Weiss.

They both claim businesses of Farmers Insurance cheated on medical bills from injuries they suffered in accidents.

At the hearing defense attorney Marci Eisenstein asked Stack to dismiss all the claims of Burke's client but not all the claims of Piper's client.

"Unlike plaintiff Hernandez, plaintiff Lewis actually asserted a breach of contract claim against a party to this case, the party who issued her policy, Mid-Century," Eisenstein said.

She said plaintiff lawyers brought Farmers Insurance Exchange back into the case six years after they voluntarily dismissed it.

"Here Farmers Exchange returns but as an improper defendant," she said.

She said Evette Shemwell started the suit in 1999, Lewis joined it in 2000, and Barbara DeManuele replaced Shemwell in 2001.

"Hernandez did not attempt to join this rotating band of plaintiffs until 2004, when she dropped her Texas case filed by the same lawyers," Eisenstein said.

She said Hernandez challenged a decision to submit three bills to a computer review.

She said Lewis challenged a decision to send her records to an orthopedist for review.

"Mr. Burke filed a brief last week which, as Mr. Burke always is, is very creative," Eisenstein said.

Burke said, "Sounds so nice, coming from you."

Stack, always quick to dispel tension, said, "Such an artist."

Eisenstein said, "It ultimately blows up a lot of smoke because it is based upon a whole series of non sequiturs."

Stack said, "That's a cartoon in the paper."

Burke said, "That's the creative part."

Eisenstein said Burke argued that Farmers Insurance Exchange became her insurer because of its status as an inter company exchange.

She said Texas Farmers, which issued the policy to Hernandez, was not a subscriber of Farmers Insurance Exchange.

She said Texas Farmers was a subsidiary of Farmers Insurance Exchange.

Burke said, "Farmers Insurance Exchange is the source of all the conduct that gave rise to the complaints."

"Texas Farmers has no employees and no assets. Illinois Farmers has no employees and no assets," Burke said.

"You want to know why we sued Farmers Insurance Exchange? It's because Farmers Insurance Exchange is the company that does everything.

"They are the ones that paid the doctors the amount they got paid. It's out of their bank account.

"Do you go after the company that really controls the conduct that was the basis of the lawsuit or do you chase the shells like some kind of three card monte?"

He said the exchange had headquarters in California.

Stack asked why the case was in Illinois instead of California.

Burke said, "Well you know it's got to be somewhere. You know, I used to have an office here. I guess that's okay. Jon's got one now."

He said Eisenstein might prevail but she was stuck in the pleading.

"Her clever phrase which I'm sure I will read somewhere, which is the rotating -," Burke said.

Eisenstein added, "Band of plaintiffs."

Burke said, "Band of plaintiffs. So I get to quote Henry the Fifth, you know? History shall woe remember this blessed few, okay?"

Eisenstein said, "He said a lot of things but virtually none of them are actually in his complaint."

Stack said, "Richard, in paragraph 30 you're saying defendant Farmers Insurance Exchange is a corporate parent. And yet you tell me it's not a corporation."

Burke said, "It is a reciprocal insurance exchange."

Stack said, "So it's not a corporation?"

Burke said, "I would have to say it's not a corporation. Can it be a parent of a corporation? I mean I don't know."

He said he attached the Texas complaint to his motions.

Stack asked if the attachment was in the allegations.

Burke said, "It's not in the complaint, no."

Stack told him he could amend the complaint to allege the things Eisenstein said he argued but did not allege.

Stack asked if the claims of Lewis and Hernandez were different.

Burke said, "There are subclasses, yes."

Stack said he wondered why Lewis, an Illinois resident, could not cover Hernandez as class representative.

Burke said they had different kinds of review.

Stack brought up the possibility of separate suits but did not get far.

After a recess Eisenstein said, "Sallie Lewis has been around a long time in this case and she proceeded for many years without Farmers Insurance Exchange as a defendant.

"This is the first time that the complaint has been amended to add this statutory fraud claim," she said.

"I'm not really sure as I sit here today what the origin of all that is. These folks were together. Now they're apart."

She said both plaintiffs sued Mid-Century but with different arguments.

She said Lewis never raised the point of the inter company exchange.

"They sued the exchange but they didn't interpose the corporate structure as a reason for arguing that the exchange should stay in the case," Eisenstein said.

"Maybe they will jump on that band wagon too."

Eisenstein said Lewis did not allege what she lost or what she would have done differently.

Stack said, "What did she lose?"

Piper said, "She lost a thousand dollars that they withheld under false pretenses."

Eisenstein said, "There is no allegation that she paid that amount. It just isn't there. We challenged that for years."

Stack said, "Did she pay it or did the doctor eat it?"

Piper said, "The doctor ate it but she incurred the liability for that."

Stack asked if Lewis claimed to represent strictly Illinois consumers.

Piper said, "As pled it is all persons."

Stack denied the motion to dismiss some of Lewis's claims.

He said, "When we come to this point we will probably have to pick how you are going to plead, which of these kinds of counts you're going on or plead them in the alternative or whatever."

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