Madison - St. Clair Record

Friday, August 23, 2019

Cates pursues class action against BCBS similar to claims crafted by controversial attorney

By Record News | May 18, 2016

Attorney David Cates, son of Presiding Justice Judy Cates of the Fifth District appellate court, has filed a suit in St. Clair County that mirrors class action litigation crafted by controversial Chicago attorney David Novoselsky. 

Their target: Health Care Services Corp. as owner of Blue Cross and Blue Shield on behalf of 16 million policy holders. 

Novoselsky just spent six months on suspension for outrageous conduct. 

According to records of his discipline at the Illinois Attorney Registration and Discipline Commission (ARDC), Novoselsky constantly called a female adversary “bitch” and “whore,” among other epithets. 

In open court he falsely accused an adversary of snorting cocaine. 

He threatened to have the job of a sheriff’s deputy who told him to lower his voice. 

Novoselsky pointed him out to the judge and said, “Apparently every time I walk through a courtroom, I’m going to have to deal with a platoon of sheriff’s deputies who seem to think they run the courthouse.” 

The judge asked him to proceed on his motion. 

“I don’t know how we can, your honor, because if I don’t argue properly maybe they’ll haul me off in cuffs because they decide they don’t like my argument,” Novoselsky said. 

He asked for transfer and said, “I will probably be in on a federal civil rights action to find out why I have to deal with garbage like this every time I walk in because your sheriff’s upset.” 

The judge said that was an insult and Novoselsky said, “It should be, your honor.” 

Novoselsky faces further discipline on a separate complaint at the ARDC. 

The commission alleges he pursued barred claims, failed to investigate claims in a complaint, removed a case to federal court without merit, misrepresented facts at a hearing on sanctions, and filed meritless pleadings in a guardianship proceeding.   

Court records identify Novoselsky as a Wisconsin citizen with an Illinois law license and an office in Chicago. 

In 2014, when he sought protection from creditors at bankruptcy court in Milwaukee, bankruptcy judge Pamela Pepper quelled a verbal riot. 

She later wrote that many creditors were former clients who “felt that the debtor had engaged in misconduct and was not a good person.” 

“The court reminded the parties, however, that the Code allowed people to file for bankruptcy protection regardless of whether they were ‘good guys’ or ‘bad guys,’ and that it contained no provision for preventing ‘bad guys’ from filing bankruptcy petitions,” Pepper wrote. 

She wrote that she understood that creditors were angry and felt Novoselsky had done bad things, but she cautioned them to maintain a professional tone. 

For years Novoselsky specialized in citizen suits claiming Cook County politicians rob taxpayers. 

He often sued former circuit clerk Dorothy Brown over her collection of fees, and he sued her for defamation after she said unpleasant things about him. 

On May 10, appellate judges of the U.S. Seventh Circuit in Chicago granted Brown immunity against the defamation claim. 

In 2012, in Lake County court at Waukegan, Novoselsky filed suit on behalf of Harlan Berk against Health Care Services Corp. as owner of Blue Cross and Blue Shield in Illinois, Texas, New Mexico, Oklahoma and Montana. 

Seeking $25 million in damages, the suit claimed that Berk made coinsurance payments that did not reflect the actual rate of repayment to various providers. 

Novoselsky called for appointment of a receiver to replace the corporation’s board, claiming the directors approved the unlawful conduct. 

Michael Noonan of Waukegan also put his name on the complaint. 

Health Care Services removed the action to federal court in Chicago, and moved to dismiss it for failure to state a claim. 

Top class action lawyers Robert Clifford of Chicago and George Bellas of Park Ridge joined Novoselsky on the case in 2013, but they could not save it. 

District Judge Charles Norgle dismissed it with prejudice in 2014, finding Berk sought relief contrary to the express terms of the insurance plan for which his employer bargained. 

“While plaintiff may prefer to have his benefits calculated in another manner, it is simply not the agreement that his employer reached with defendant,” Norgle wrote. 

“Plaintiff has had numerous opportunities to properly plead his case in the last two years, but he has failed to do so.” 

Last September, Noonan filed suit in Lake County for Daryl Hedlin, claiming Health Care Services Corp.  improperly benefited from transactions of subsidiaries. 

James Hortsman of Chicago and Jonathan Novoselsky of Waukegan, son of David, placed their names on the complaint. 

David Novoselsky entered an appearance after completing his term of suspension. 

Circuit judge Luis Berrones plans a July 15 hearing on a motion to dismiss. 

Meanwhile, on Oct. 8, Cates filed a complaint with similar allegations in St. Clair County chancery court, on behalf of Chet Kelly. 

The first page and the last page identified Jonathan Novoselsky as plaintiff’s counsel. 

The first page identified Noonan’s firm and Horstman’s firm as plaintiff’s counsel, but their names didn’t appear on the last page. 

The day after the case was filed, Cates amended the complaint to remove their firms. 

In December, Health Care Services moved to substitute Circuit Judge Robert LeChien and Chief Judge John Baricevic assigned the case to Associate Judge Christopher Kolker. 

Cates amended the complaint in March, and Health Care Services counsel Michael Nester of Belleville moved in April to dismiss it. 

“The same parties have begun litigating the same issues related to the same set of facts in Lake County, and that litigation was filed first,” Nester wrote. 

On April 29 Baricevic entered an order telling the parties the court would hold oral argument at their request. 

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