Fayette County Associate Judge J. Marc Kelly granted Madison County’s motion to expedite the resolution of its dismissal from a seven-year-old bid-rigging class action alleging several tax buyers participated in a scheme with former Treasurer Fred Bathon.
In his July 13 order, Kelly granted Madison County’s motion for entry of Illinois Supreme Court Rule 304(a), finding that “there is no just reason for delaying either enforcement or appeal or both of the May 22, 2020 order granting Madison County’s motion to dismiss the third amended complaint.”
Madison County filed the motion for entry of Rule 304(a) on June 10 through attorneys Ann Barron, Patrick Cloud and Michael Schag of Heyl Royster Voelker & Allen PC in Edwardsville.
“In this case, the entry of a Rule 304(a) finding will expedite the resolution of this matter as to Madison County. The May 22, 2020 order will be appealable now and not require Madison County to wait until the end of this litigation for any appeal. This may reduce costs and conserve judicial resources in light of the current status of the case,” the motion states.
According to Illinois Supreme Court Rule 304(a), “’if multiple parties or multiple claims for relief are involved in an action, an appeal may be taken from a final judgment as to one or more but fewer than all of the parties or claims only if the trial court has made an express written finding that there is no just reason for delaying either enforcement or appeal or both.’”
Madison County was dismissed from the third amended complaint on May 22 after a complicated history in the suit.
The original lawsuit was filed on Feb. 13, 2013. After Madison County moved for dismissal, the trial court dismissed counts for conspiracy and respondeat superior for failure to state a cause of action.
Then in March 2013, two new class actions were filed against Madison County. The trial court entered a dismissal order in one of the cases for the same reasons on Oct. 28, 2013. The plaintiffs in the original case responded by filing a consolidated amended complaint on Feb. 24, 2014. Madison County was included as a defendant. The plaintiffs filed a second amended complaint under the theory of res judicata on July 11, 2014.
Madison County was eventually dismissed from the complaint again when the Fifth District Appellate Court concluded that the plaintiffs could not state a valid claim against the defendant.
Kelly granted the plaintiffs’ request to amend their complaint to rejoin Madison County and Treasurer Kurt Prenzler as defendants following Bathon’s May 2017 deposition.
During his deposition, Bathon testified that numerous Madison County officials knew of, and participated in, the alleged conspiracy.
In its newest motion to dismiss, Madison County argued that the complaint is barred by the doctrine of res judicata, the doctrines of waiver and collateral estoppel, and the statute of limitations. The motion was argued at a March 5 hearing.
Kelly determined that dismissal was proper on the doctrine of res judicata. For that reason, he did not take up the remaining arguments.
While Madison County was dismissed, claims against tax-buyer defendants and county officials remain pending.
Plaintiff attorney Nelson Mitten of St. Louis filed the amended bid-rigging complaint on Sept. 25, 2017, on behalf of the class after Kelly granted them leave to rejoin Madison County and former treasurer Kurt Prenzler as defendants.
In their complaint, the plaintiffs allege Bathon arranged for tax buyers to charge interest at the maximum legal limit of 18 percent at auctions of delinquent property taxes from 2005 to 2008.
The plaintiffs allege Bathon conspired with each tax purchaser defendant to establish a “no trailing bid” policy, meaning the process required one-time, simultaneous bidding. Rather than allowing a series of bids, all bidders had to bid at once, with the auctioneer accepting the lowest bid that was heard.
The defendants allegedly then made an agreement with Bathon to bid the maximum of 18 percent in the simultaneous bidding.
Mitten wrote that Bathon used a seating chart to ensure that the tax purchaser defendants would be recognized by the auctioneer and the Madison County employees conducting the sales as the winning bidders.
The plaintiffs allege Foley and non-party Patty Ward Stanley conducted the auctions and were supposed to “foster competition in order to obtain the lowest penalty percentage.” However, Mitten wrote that they agreed to act in concert with the conspiracy by accepting the bids at the maximum rate.
“The actions of Bathon, Foley, and Stanley were motivated in least in part to benefit not only themselves, but Madison County as well, by enticing the Tax Purchaser Defendants, as well as others, to purchase more tax certificates each year, such that the County would have more money in its treasury each year,” Mitten wrote.
The plaintiffs allege that as the actions of the tax purchaser defendants became evident, other purchasers also began bidding higher than they otherwise would have.
“Because there was no or virtually no competitive bidding, the bidding was rigged, prices were fixed, and almost every single property was sold at the statutory maximum penalty percentage of 18%,” Mitten wrote.
Then after Bathon resigned, every annual tax sale conducted has resulted in an average penalty bid of less than 5 percent, the suit states.
The plaintiffs allege that in return for rigging the tax sales, Bathon received campaign contributions and support from tax purchasers
Bathon was charged in February 2013 with violating the Sherman Antitrust Act. He pleaded guilty the same day. Defendants Scott McLean, Barrett Rochman and Joe Vassen also entered guilty pleas to federal antitrust charges in October 2013.
Madison County Circuit Court case number 13-L-276