News & Events

Chicago, April 6, 2015

Recent Results Highlight Swanson, Martin & Bell, LLP’s Growing Strength in Commercial Litigation and Intellectual Property

Long known for its depth in tort defense and trial experience, Swanson, Martin & Bell, LLP’s success continues in other litigation areas.
Case 1
Recently attorneys Joseph P. Kincaid, Michael A. McCaskey and Julie D. Miller secured a nearly unprecedented retroactive compliance order from the Federal Communications Commission (FCC) on behalf of a client sued in a class action under the Telephone Consumer Protection Act (TCPA). The retroactive order enabled Magna Chek, a 44-year-old small business in suburban Detroit, to stay in business without the threat of bankruptcy.

The federal class action was brought by an Illinois chiropractor who received a faxed advertisement from the company and alleged that Magna Chek did not include particular language in its opt-out notice on faxes sent to current and potential customers. 

Swanson, Martin & Bell, LLP attorneys convinced a federal judge to stay their case so they could petition the FCC.  Magna Chek’s FCC petition said that the lack of certain phrasing in its opt-out notice was a “minor technical violation” that could force Magna Chek out of business and have repercussions for other businesses as well.

The FCC eventually ruled that that the law was unclear and granted Magna Chek a retroactive waiver on requiring opt-out notices on its fax advertisements. According to the FCC ruling, businesses must now include compliant opt-out notices on all faxes, even to current customers or those who granted consent to receive advertisement. The FCC also granted a six-month window to other businesses to file a petition to be granted a waiver. Companies have until April 30, 2015 to file that petition. Most importantly, the ruling provided Magna Chek with a strong defense against liability under the TCPA and yielded the eventual dismissal of the class action lawsuit.

Case 2

In a separate matter, last fall two Swanson, Martin & Bell, LLP attorneys obtained a record-setting near $10 million plaintiff’s property damage judgment against defendant Union Pacific Railroad Company in downstate Macoupin County, Ill. The judgment followed five years of litigation, including three trips to the Illinois Appellate Court and one to the Illinois Supreme Court. 

The Gillespie School District, represented by Swanson, Martin & Bell, LLP attorneys Thomas J. Verticchio and Matthew T. Kinst, and Gillespie, Ill. attorneys Rick and Gina Verticchio, prevailed in its lawsuit against Union Pacific, stemming from a March 2009 coal mine subsidence that destroyed the district’s elementary school. The judgment was premised upon Union Pacific’s merger partner, Chicago & North Western Railway Co., being the successor to an entity which assumed mine subsidence liability in 1956 concerning the land upon which the district’s elementary school was built in 2002.

The elementary school suffered structural damage when pillars of coal supporting the roof of the mines beneath the school collapsed, causing the land above to subside. The school building was condemned by the State of Illinois shortly after the incident, and then demolished.   The school district built a new elementary school in 2013. The $9,850,000 judgment proceeds will allow the school district to pay down debt incurred when building its new school. Union Pacific has appealed to the Fourth District Appellate Court. Brothers Thomas and Rick Verticchio are both graduates of Gillespie High School.

Case 3

Finally, Swanson, Martin & Bell, LLP client Business Logic Holding Corporation obtained a $61 million settlement last July in a complex trade secret misappropriation and breach of contract case against Ibbotson Associates and Morningstar, Inc. (MORN). The publicly reported settlement ranks as both one of the largest reported Illinois settlements in recent years and is now the #9 biggest disclosed trade secret settlement of all time, according to Orrick.[1]

Business Logic, a pioneer in the 401(k) retirement managed accounts software industry, sued Morningstar and its wholly owned subsidiary, Ibbotson, for violating the terms of their reseller agreement and misappropriating Business Logic's confidential information and trade secrets to design and develop its own 401(k) retirement account software in 2009. The lawsuit arose out of a 2003 contract wherein Ibbotson agreed to resell Business Logic's 401(k) financial retirement portfolio management software. In 2006, Morningstar acquired Ibbotson.

Business Logic had alleged that Morningstar software designers and developers obtained and accessed confidential and proprietary Business Logic software and documentation to create software that would ultimately be used to compete with Business Logic after 2009. In addition to the settlement figure, the parties jointly stated and acknowledged as part of the settlement agreement that the 401(k) managed accounts software currently marketed and sold by Morningstar was partially developed from Business Logic’s managed accounts software.

Business Logic was represented by Swanson, Martin & Bell, LLP Partners P. Stephen Fardy and Peter G. Skiko, along with R. Paul Yetter and Collin J. Cox of Yetter Coleman LLP in Houston.  

[1] UPDATE: A New Top 10 Disclosed Trade Secret Settlement, Last updated on July 18, 2014, last visited on April 2, 2015.

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