XXIII. December 21, 1992-May 12, 1993: How the defendants “bought the case from the plaintiff” so that, in Judge Zagel’s view, they could remove all but a handful of the 90c5009 records from the courthouse before those records were docketed.

  1. December 21-28: Grove Fresh’s decision to support the Coalition’s appeal.
  2. January 4: The Coalition’s motion regarding the record on appeal.
  3. January 4: The defendants’ motion to dismiss the Coalition’s appeal.
  4. January 15: Grove Fresh’s Memorandum opposing the motion to dismiss the Coalition’s appeal.
  5. January 21, 1993: The letter that “relieved” me “of all responsibility” for the litigation but reaffirmed my right to a contingent fee.
  6. The legal significance of Grove Fresh’s reaffirmation of my right to a contingent fee.
  7. January 27: The first settlement conference with Judge Zagel.
  8. February 1: The mysterious disappearance of the 90c5009 case file.
  9. February 1-12 : The exclusion of Grove Fresh’s papers from the re-created record for the Coalition’s appeal.
  10. Rivkin Radler & Kremer’s acquiescence in the incomplete record
  11. February 12: My retention of Frederick Brace and David Lee.
  12. February 18: The related criminal case against Marshall, Kohlbach, et al.
  13. February 19-20: My agreement, in principal, to a consulting arrangement with the defendants.
  14. Radler’s conflict between his duty to his client and his fiduciary duty to his co-counsel.
  15. February 22-March 24: The three consumer class action cases.
  16. March 5: The Seventh Circuit’s request for an explanation from Judge Zagel of the grounds on which he granted the Coalition leave to intervene.
  17. Early March: The discovery that the “missing” 90c5009 case file was in Judge Zagel’s chambers.
  18. March 9-10: The settlement documents.
    1. Radler’s concessions regarding the 90c5009 records and Grove Fresh’s role in the Coalition’s appeal.
    2. The ramifications of Radler’s concessions.
    3. The consulting fees as hush money.
  19. March 12-24: The non-negotiability of the Consulting Agreement.
    1. Defendants’ confirmation that my executing the Consulting Agreement was a non-negotiable condition of settlement.
    2. The demand that I subscribe to untrue representations about my state of mind.
    3. The Consulting Agreement’s ethically dubious fee structure, and the disclosure that the defendants had no intention of using my services.
    4. The impasse.
  20. The conference in chambers on March 25, 1993.
  21. Radler’s request that I sign the Consulting Agreement in exactly the form proposed by the defendants.
  22. Escrowing the initial $50,000 installment of the consulting fee.
  23. April 29 1993: Dismissal of the Grove Fresh litigation and authorization to remove the 90c5009 records.
  24. May 5-11: Judge Zagel’s declaration that “[t]he defendant bought the case from the plaintiff.”
  25. May 12, 1993: The clerk of court’s unexplained omission to create a docket for 90c5009.

A. December 21-28: Grove Fresh’s decision to support the Coalition’s appeal. 

During the week of December 21, I had a lengthy conversation with Dale Crider, a Rivkin Radler & Kremer partner, about the pros and cons of Grove Fresh participating in the Coalition’s appeal.  We agreed that Grove Fresh should participate.  I then discussed the subject with Mr. Troy.  He authorized us to participate in the appeal.

On December 28, 1992, I filed my appearance for Grove Fresh in the Seventh Circuit. 

B. January 4: The Coalition’s motion regarding the record on appeal.

The Coalition filed its brief on the merits on January 4, 1993.  That same day it filed two motions:

  • Motion to Include the Sealed District Court Case File in 90c5009 as Part of the Record in this Appeal and to Direct the District Court Clerk to Transmit the Sealed Record in 90c5009 to the Court of Appeals (“Motion to Perfect the Record”). 
  • Motion to Expedite Appeal.

According to the Motion to Perfect the Record (¶2), the district court clerk would not transmit the 90c5009 case file to the Seventh Circuit “unless it is directed to do so by court order.” 

The Motion to Perfect the Record was still unresolved as of April 13, 1993, the date the Grove Fresh litigation was formally settled.

C. January 4: The defendants’ motion to dismiss the Coalition’s appeal. 

On January 4, 1993, the defendants moved to dismiss the Coalition’s appeal, arguing that the 11/20/92 Order was an interlocutory ruling that did not meet the criteria for appeal under the collateral order doctrine.  Four days later, the Court of Appeals issued a scheduling order—it would defer consideration of the Coalition’s Motion to Perfect the Record until after it ruled on the defendants’ motion to dismiss the appeal. 

D. January 15: Grove Fresh’s Memorandum opposing the motion to dismiss the Coalition’s appeal. 

On Tuesday, January 12, Crider told me that the Seventh Circuit had set January 15 as the date for responding to the motion to dismiss the appeal.  We agreed that Grove Fresh should file papers opposing this motion. 

Over the next two days I drafted an 18-page memorandum styled Plaintiff Grove Fresh’s Memorandum in Opposition to Defendants’ Motions to Dismiss Appeal, and in Support of Intervenor’s Various Motions (“Grove Fresh’s Memorandum on Appealability”).  The draft included a nine-page procedural history covering the following subjects:

  • The five lawsuits that attorney Jeffrey Hines filed for Grove Fresh in February 1989.
  • Hines’s knowledge of Everfresh’s and Home Juice’s illegal practices dating back to mid-1970s.
  • Grove Fresh’s discharge of Hines in November 1989, after learning that he was bound by covenants barring him from suing Everfresh or Home Juice for illegal acts prior to mid 1988. 
  • The information Grove Fresh collected during a nine-month search of public records, and which was incorporated into the 90c5009 complaint. 
  • The events leading to the emergency motion for a seal on the 90c5009 complaint.
  • The evidence regarding the defendants’ use of an unsafe and illegal additive to extend shelf life. 

The draft memorandum made the following arguments in opposing the motion to dismiss the appeal:

  1. The appeal from the order denying relief from the 89c1113 Confidentiality Order was ripe for appeal because a final order adjudicating the merits of that case had been entered.
  2. The claim for relief in 90c5009 was ripe for appeal because the sealing order was an unconstitutional prior restraint that would escape review unless the Coalition’s appeal went forward. 
  3. The court of appeals should grant the Coalition’s motion to include the 90c5009 case file in the record on appeal. 
  4. Grove Fresh’s Memorandum should be maintained in the public files. 

On Thursday, January 14, I faxed Crider a draft of Grove Fresh’s Memorandum on Appealability.  He approved.  I finalized the memorandum and filed it the next day. 

E. January 21, 1993: The letter that “relieved” me “of all responsibility” for the litigation but reaffirmed my right to a contingent fee.

The defendants were unhappy with the contents of Grove Fresh’s Memorandum on Appealability.  The following Monday (January 18), they threatened to terminate settlement negotiations unless Grove Fresh withdrew it.  Radler and I disagreed over how to respond to this demand.  He gave Troy an ultimatum: he and his firm would withdraw from the litigation unless they were given complete control over all aspects of Grove Fresh’s claims. 

Troy acceded to this demand.  On January 21, 1993, he signed a letter dictated by Radler that stated as follows:

This confirms our meeting today at Rivkin, Radler & Kremer.  You are hereby relieved of all responsibility in the handling of this matter.  Warren S. Radler and Dale R. Crider will act as our sole attorneys and trial lawyers.

We very much appreciate all of your effort in getting this ready for trial and we are optimistic that the matter will be resolved favorably. 

This will also advise you that you will continue to be entitled to receive 20% of any amount received by way of settlement or verdict.  [emphasis added.]

When Radler dictated the affirmation that I would “continue to be entitled to receive 20% of any amount received by way of settlement or verdict,” he was aware of the Illinois Supreme Court’s decision in In re Estate of Callahan, 144 Ill. 2d 32, 578 N.E.2d 985 (1991), which holds that a discharged attorney loses his right to a contingent fee.[1] 

By explicitly reaffirming my right to a contingent fee, Radler implicitly affirmed that I continued to enjoy an attorney-client relationship with Grove Fresh after January 21, 1993. 

F. The legal significance of Grove Fresh’s reaffirmation of my right to a contingent fee.

By having me “relieved of all responsibility” for the Grove Fresh litigation, rather than having me discharged as a Grove Fresh lawyer, Radler avoided a controversy that would have detracted from the effort to settle the litigation. 

Dismissing me without cause would have triggered my right to an immediate payment in quantum meruit.[2]  Because Grove Fresh did not have the funds to make a quantum meruit payment, I could have asserted a possessory lien over my litigation files.[3]  A fight between Grove Fresh and me over possession of litigation files would have weakened Grove Fresh’s bargaining position with the defendants. 

In any event, I construed Grove Fresh’s reaffirmation of my right to the contingent fee as implying that I continued to have an attorney-client relationship with Grove Fresh after January 21, 1993.  Judge Zagel agreed with this view in December 1994, when he denied defendants’ motion to compel discovery of communications that took place after January 21, 1993, between Grove Fresh and me, and between Rivkin Radler & Kremer and me.  See XXVII-I, below.

G. January 27: The first settlement conference with Judge Zagel.

Judge Zagel held two settlement conferences in chambers.  The first conference was for attorneys only; it was held on January 27, 1993.  Radler did not permit me to attend; no one has ever told me what was said at the conference. 

The next conference was held on Friday, February 19, 1993.  See §M, below.

H. February 1: The mysterious disappearance of the 90c5009 case file. 

As of February 1, 1993, there were more than 200 pleadings, motions, briefs, orders, and other papers in the 90c5009 case file, but none of those papers had been transmitted to the Seventh Circuit.  On that date the Seventh Circuit issued an order implying that the 90c5009 case file couldn’t be transmitted because it had disappeared:

Due to the unavailability of certain documents, the clerk of the district court was unable to transmit a complete record on appeal for this court’s review.  Counsel shall tender copies of all previously “unavailable” documents to the clerk of the district court by no later than 3:00 pm on Thursday, February 4, 1993.  These copies shall be accompanied by the stipulation of counsel as to the accuracy of the copies tendered.

The clerk of the district court shall transmit these documents as a supplemental record by no later than February 5, 1993. (emphasis added)[4] 

After receiving this order Elson investigated the order’s reference to “the unavailability of certain documents.”  Eventually, a deputy clerk in the district court told him that the 90c5009 file had been lost and couldn’t be found.  

I. February 1-12 : The exclusion of Grove Fresh’s papers from the re-created record for the Coalition’s appeal. 

On February 3, the Coalition tendered to the district court clerk copies of the four sets of papers it had filed in the district court.  See §§XIX-A-1, 3, 8, above.

That same day, a McDermott Will & Emery lawyer tendered to the district court clerk a duplicate set of the papers that the Coalition was tendering.  McDermott Will & Emery did not tender any of the other 200+ papers that were “unavailable” to the Seventh Circuit, not even the three sets of papers it had filed in opposition to the Coalition’s claims. 

On February 10 the Seventh Circuit issued another order requiring Everfresh to tender by 3 p.m. on February 11 only one document—its memorandum in opposition to the Coalition’s motion to intervene.  Everfresh complied; the memorandum was transmitted to the Seventh Circuit on February 12.

As of February 12, only five of the 200+ records in the 90c5009 file had been transmitted to the Seventh Circuit—the four sets of papers filed by the Coalition, and one of the sets of papers filed by Everfresh in opposition to the Coalition’s claims. 

None of the three sets of papers Grove Fresh had filed regarding the Coalition’s claims[5] had been included.  

J. Rivkin Radler & Kremer’s acquiescence in the incomplete record. 

At some point between February 1-12, I asked Crider why Grove Fresh had not submitted to the Seventh Circuit copies of the papers we had filed in support of the Coalition’s access claims.  He informed me that after I had been “relieved of all responsibility” for the Grove Fresh litigation, Radler had assured the defendants that Grove Fresh would not participate any further in the Coalition’s appeal. 

K. February 12: My retention of Frederick Brace and David Lee. 

On February 12, I retained Frederick Brace and David Lee for advice on any settlement proposals that were intended to restrict my right to practice law. 

L. February 18: The related criminal case against Marshall, Kohlbach, et al.

On February 18, 1993, a federal grand jury in Michigan issued a 33-count indictment charging Flavor Fresh, Peninsular, Marshall, Kohlbach, and seven other individuals with a scheme to sell consumers adulterated orange juice.  United States v. Peninsular Products Co., et al., 93 CR 21 (W.D. Mich.). 

The indictment accused the defendants of using large amounts of low-cost inferior ingredients like sugar, citric acid and amino acids and falsely labeling the product as orange juice from concentrate.  The indictment also alleged a scheme to extend shelf life using Oleum 320/IDEA.  The indictment covered juices that were distributed under at least 23 different labels nationwide in 1979-91.[6]

M. February 19-20: My agreement, in principal, to a consulting arrangement with the defendants. 

The second settlement conference, held on February 19, was attended by the parties and their counsel, except that Radler again did not permit me to attend.  That evening Troy called to tell me that the conference had ended with a settlement, but that there was a twist involving me that he did not want to discuss over the phone.  He asked me to meet him at Radler’s office the next morning.  I did. 

The meeting with Troy and Radler lasted about twenty minutes.  Radler, speaking first, summarized the previous day’s conference in chambers.  My best recollection of what Radler told me is set forth in a letter I sent to attorney Brace on Monday, February 22, 1993.  That letter stated in pertinent part as follows:

On Saturday, February 20, 1993, I had a 20-minute meeting with my co-counsel, Mr. Radler, and my client, Mr. Troy.  I was given a report on the previous day’s settlement conference with Judge Zagel.  In brief, this is what Mr. Radler told me: 

The conference lasted about four hours and was attended by the parties and some of the attorneys.  There were no face-to-face negotiations.  Each side’s positions were communicated through Judge Zagel.  The defendants would not change their previous offer of $2,000,000.  Mr. Troy, after some initial resistance, acceded to the defendants. [emphasis added]

The defendants told Judge Zagel that they would not settle even at their $2,000,000 figure unless they were able to “tie me up” for the next two years.  Through Judge Zagel, the defendants proposed a two-year, $200,000 Consulting Agreement.  The consulting fee would be paid into an interest-bearing escrow account, with $50,000 payable shortly after closing, and the balance payable in three installments of $50,000 each at eight months, sixteen months, and twenty-four months after closing.  No Consulting Agreement was offered to or sought by Rivkin Radler & Kremer. [emphasis added]

[Parenthetical comments about the value of the settlement are omitted.] 

Mr. Radler told Judge Zagel that the defendants’ terms were acceptable to him and to Mr. Troy, subject to my approval.  Judge Zagel told him to contact the court if there were any problems.

After Radler finished speaking Troy pleaded with me to accept the defendants’ demand that I execute a consulting agreement.  He reminded me that he had just turned 78, that his overall health was not good, and that he was under a physician’s care for the after-effects of several strokes.  He said that Grove Fresh had lost $100,000 in 1992 and that he wanted to settle the litigation before he was “pushing up daisies.”  He asked me to agree to the consulting agreement so that he could put the litigation behind him.  I said I would, subject to an acceptable writing. 

The following Tuesday, February 23, 1993, Radler sent the following letter to Judge Zagel:

I simply want to advise you that, subject to working out the terms and conditions of the settlement agreement and consulting agreement in this matter, this case has been settled for the total sum of $2,200,000.  This includes $200,000 allocable to the consulting agreement with Mr. Messina

We are very appreciative of your efforts in helping us to resolve this complex matter.  I know you put a great deal of time into it. (emphasis added) 

The statements Radler made at the twenty-minute meeting on February 20, and the carbon copy of his February 23rd letter to Judge Zagel, are all that I ever learned from Radler about the discussions in Judge Zagel’s chambers. 

N. Radler’s conflict between his duty to his client and his fiduciary duty to his co-counsel. 

There was one circumstance of the February 19th negotiations that was not disclosed to me until the summer of 1994.  This circumstance illustrated Radler’s conflict of interest between his duties to Grove Fresh and his duties to me as his joint venturer under a contingent fee contract.[7] 

What I learned in the summer of 1994 is that after Grove Fresh and the defendants agreed on a final settlement figure of $2,200,000, Radler proposed that the amount allocable to the Consulting Agreement be reduced from $200,000 to $100,000.  The defendants rejected Radler’s proposal; the fee for the consulting agreement remained at $200,000. 

If lawyers were allowed to rank their conflicting interests and then to act for the benefit of a higher ranking interest at the expense of a lower ranking one, then Radler acted properly by seeking to reallocate the proceeds of the $2,200,000 settlement package.  His duty to Grove Fresh, the client, outranked his duty to me, his co-counsel.  By seeking to increase the amount of Grove Fresh’s settlement (which, of course, would increase the yield of his 20% contingent fee) at the expense of the consulting fee that was to be paid to me alone, he was promoting a higher interest (his client’s) at the expense of a lower-ranked one (his co-counsel’s).  However, lawyers are not allowed to act in this fashion, at least not without the informed consent of the lesser interest, which Radler did not have. 

In any event, regardless of whether Radler was wrong to negotiate the terms of the Consulting Agreement as part of the Grove Fresh settlement, his attempt to reduce the amount of the consulting fee gave clear notice to the defendants and the court that he was not representing me, and that he was acting against my financial interests. 

As a result, neither Judge Zagel nor the defendants could reasonably have relied on any statements that Radler might have made at the February 19th conference about my alleged views on the Consulting Agreement.

O. February 22-March 24: The three consumer class action cases. 

On February 22, 1993, attorney Lawrence Walner filed a consumer class action complaint in the Circuit Court of Cook County, styled Donley v. Marshall, et al., 93 CH 1610.  The Donley complaint tracked the allegations in the related criminal case against Flavor Fresh, Peninsular Products, and the others.

Two days later, Walner filed two more consumer class actions.  Shore v. Powell, et al., 93 CH 1753, tracked the allegations of 89c1113 and alleged claims against Everfresh and Labatt.  Scorzo v. Lang, et al., 93 CH 1754, tracked the allegations of 89c1117 and alleged claims against American Citrus and Lang. 

All three complaints alleged breaches of warranties and violations of RICO and consumer fraud statutes.  The complaints did not allege any conspiracy among the defendants in the three cases.  Because the complaints were filed as three separate, unrelated cases, they were assigned to three different judges. 

Because Walner’s complaints did not allege a conspiracy, he had no grounds for holding the deep-pocket defendant (Labatt) jointly and severally liable for the tens of millions of dollars in damages that could be proved against Flavor Fresh and Peninsular,[8] which had become insolvent. 

The summonses and complaints were served on or about March 24, 1993.

P. March 5: The Seventh Circuit’s request for an explanation from Judge Zagel of the grounds on which he granted the Coalition leave to intervene. 

On March 5, the Court of Appeals issued an order finding that it was “unable to ascertain the basis upon which the district court allowed the [Coalition] to intervene,” so it remanded the appeal “for the limited purpose of allowing Judge Zagel to issue a memorandum opinion on this issue.  We ask that Judge Zagel issue this opinion within 30 days of the date of this order,” i.e., by April 4.

April 4 came and went without any word from Judge Zagel. 

Judge Zagel issued his explanation on May 5.  By then, the case had settled, and he had authorized the defendants to remove the 90c5009 records from the courthouse.  See §§W-X, below.

Q. Early March: The discovery that the “missing” 90c5009 case file was in Judge Zagel’s chambers. 

Around the time that the Seventh Circuit remanded the case for a clarification on the standing issue, John Elson, the Coalition’s lawyer, spoke to Don Walker, Judge Zagel’s courtroom deputy, regarding the 90c5009 case file. 

Walker told Elson that the 90c5009 file was in Judge Zagel’s chambers, but that he (Walker) was not authorized to release the file to the clerk of court. 

Elson told me about this conversation a day or two after it occurred.

R. March 9-10: The settlement documents.

On March 9, McDermott Will & Emery delivered two documents to Rivkin Radler & Kremer: the initial draft of the settlement contract between Grove Fresh and the defendants, and the initial draft of a Legal Services and Consulting Agreement (“Consulting Agreement”) between two of the defendants (Labatt and American Citrus) and me. 

I received the settlement documents on March 10.  That same day I learned that Radler had made yet another concession affecting the Coalition’s appeal.[9]  If carried out, Radler’s concessions would leave me defenseless in the Seventh Circuit if, as expected, the defendants repeated there the defamatory arguments they had presented to Judge Zagel in opposing the Coalition’s claims for access to the 90c5009 records. 

1. Radler’s concessions regarding the 90c5009 records and Grove Fresh’s role in the Coalition’s appeal. 

The draft of the settlement contract was unremarkable except for these two sentences in §1:

[A]ll parties and their respective attorneys will sign an Agreed Motion to Withdraw All Pleadings filed with the United States District Court for the Northern District of Illinois in civil action Nos. 89 C 1113; 89 C 1117; and 90 C 5009.  The parties will then jointly present these agreed motions to the court.

In a letter to defense counsel dated March 10, Crider explained that, while he and his firm would not join in a motion to withdraw pleadings, they would “agree not to oppose such a motion should you determine that one should be made.”

Until I read the March 9th draft and Crider’s March 10th letter, I did not know that the defendants were demanding to remove pleadings from the courthouse.  I asked Crider whether this demand was new; it wasn’t, he said.  The defendants had made the demand during the settlement conferences with Judge Zagel; Radler had agreed to accommodate it. 

Crider also confirmed, again, that Radler had assured the defendants that Grove Fresh would not participate in the Coalition’s appeal.

2. The ramifications of Radler’s concessions. 

The defendants’ only chance at defeating the Coalition’s appeal was if they reiterated in the Seventh Circuit the arguments they had submitted to Judge Zagel.  Those arguments presented a version of events that, if accepted as true, would justify affirming the seal order in accordance with Nixon v. Warner Communications, 435 U.S. 589, 598 (1978).  Nixon held that trial courts can seal files that “have become a vehicle for improper purposes” such as to “promote public scandal” or “to serve as reservoirs of libelous statements for press consumption.”

The defendants’ anti-access arguments were, however, untrue; their untruths slandered me.  Leaving those arguments unanswered in the Seventh Circuit would invite the court to accept them as true and affirm the sealing order.  If reiterated in a published opinion, the untruths would defame me;[10] if reported in the press, they would trigger an investigation by the Attorney Registration and Disciplinary Commission.[11] 

Grove Fresh had rebutted those untruths in the district court (see §§XIX-A-4, 9, 11, above), but Radler’s concessions[12]—withdrawing Grove Fresh from the appellate process, and allowing the defendants to permanently remove Grove Fresh’s district court papers from the courthouse—ensured that those rebuttals would not see the light of day in the Seventh Circuit. 

3. The consulting fees as hush money.

I received the draft of the Consulting Agreement on March 10, the day after it was tendered to Rivkin Radler & Kremer.  Before this draft arrived I had held out hope that I might negotiate a legitimate consulting arrangement with the defendants—one where I would actually render services in exchange for the $200,000 they would be paying me.  Rendering actual services was important to me—the ethics of the consulting arrangement could not plausibly be questioned if I performed a reasonable amount of services in exchange for the fees I’d be receiving. 

Moreover, actively representing my new clients (Labatt and American Citrus), either in court or in business transactions, would help me re-build my practice, as I would be meeting corporate officers and lawyers whom I might otherwise not meet; through them, I might find business opportunities that otherwise might not come my way. 

The draft I received on March 10 jolted me out of that reverie.  The draft made clear that the defendants were paying $200,000 to have me sit still and keep quiet; they had no interest in my services.  The clues to their intent were embedded in provisions that:

  • Barred me from any “communications or dealings with third parties on behalf of the [defendants].”[13]
  • Barred me from telling anyone anything that I knew about the defendants’ past or present activities.[14]
  • Required me to turn over to the defendants every scrap of paper I had “relating in any way to [their] businesses.”[15]
  • Barred me from telling anyone that I was under contract to the defendants.[16] 

Colloquially speaking, the Consulting Agreement was nothing more than a covert mechanism for delivering $200,000 in hush money. 

S. March 12-24: The non-negotiability of the Consulting Agreement. 

Attorney David Lee represented me in my efforts to negotiate over the terms of the Consulting Agreement.  Radler had previously told me that the amount of the consulting fee and the length of the arrangement were non-negotiable items, so I instructed Lee not to discuss these issues with defense counsel, and he did not. 

Lee’s negotiations were limited to boilerplate provisions in the defendants’ draft, such as those purporting to express the parties’ respective states of mind.  The provisions regarding my state of mind became major points of contention; by March 24, we were at an impasse.

1. Defendants’ confirmation that my executing the Consulting Agreement was a non-negotiable condition of settlement. 

On March 12, Lee sent defense counsel a markup of their draft of the Consulting Agreement.  His transmittal letter put the defendants on notice that I did not want to enter into a consulting agreement with them:

Here is my markup of your draft Agreement.  Mr. Messina understands that your clients require this Agreement as part of the Grove Fresh settlement.  If that is not correct, please conclude the Grove Fresh settlement without this Agreement and the $200,000 that would be payable thereunder. 

On March 16 and 19, 1993, Lee discussed the Consulting Agreement with Lazar Raynal, one of Everfresh’s attorneys.  In one or both conversations Raynal confirmed that I was required to sign the Consulting Agreement as a condition of settlement.

2. The demand that I subscribe to untrue representations about my state of mind. 

Lee’s March 12th mark-up struck items from the defendants’ draft of the Consulting Agreement that were not acceptable to me.  One of the stricken items was the false recital that “Messina seeks to be employed by the Hiring Parties.”  Another was Section 4, which Lee struck in its entirety because it included three representations that were not true: 

[i] Messina and the Hiring Parties each warrant and represent that each has relied upon its own judgment and on the advice of its/his own attorneys, and not on any advice, statement or representation of any other party or its counsel, regarding the proper, complete and agreed upon consideration and as to the propriety of and basis for its/his decision to enter into this Agreement and for the language of this Agreement.  [ii] Each party further agrees that no statements or representations made by any of the parties, or any of their agents, employees or counsel, have influenced or induced it to execute this Agreement.  [iii] In addition, Messina specifically acknowledges and represents that he has reviewed the applicable ethical rules and restrictions that apply to attorneys in the State of Illinois, and that he has concluded that this consulting agreement is consistent with and is not in violation of any of those ethical rules or restrictions. 

The defendants, through Raynal, objected to the deletion of Section 4.  Raynal insisted that Section 4 had to be included in the executed version of the Consulting Agreement. 

3. The Consulting Agreement’s ethically dubious fee structure, and the disclosure that the defendants had no intention of using my services.

Raynal also discussed with Lee proposed changes to Section 5, which provided for the payment of a $200,000 fee. 

Lee proposed to clarify the defendants’ language so as to provide that the $200,000 fee was “in consideration of Messina’s making himself available to the Hiring Parties to perform legal services.”  This modification was intended to establish that the fee was for an option on my services that was intended to prevent others from retaining me, and to preclude any claim that the consulting fee was a non-refundable, advance retainer, which is improper if no services are ever rendered.  See G. Hazard & W. Hodes, The Law of Lawyering §1.5:201 (2d ed. 1966).  Lee also proposed to add the following provision to Section 5:

Should the Hiring Parties request Messina to provide any legal services during the term of this agreement, then Messina will bill the Hiring Parties for such services at his normal hourly rate, as it may increase from time to time, and the Hiring Parties will pay such bills in full within 15 days after Messina mails such bills. 

Raynal told Lee that the proposed procedures for billing the defendants for my services were irrelevant because the defendants had no intention of actually using my services.

4. The impasse. 

On March 21, 1993, I contacted defense counsel myself and faxed them a Revised Draft that included the proposed changes from the first draft (the “Original Draft”) on which Lee and Raynal had agreed.  Since I still would not subscribe to the untrue representations in Section 4 of the Original Draft, the Revised Draft deleted that Section.  My transmittal letter stated in pertinent part:

As you know, I did not solicit a consulting agreement, nor did I participate in any of the discussions leading up to the proposal that was made at the settlement conference on February 19, 1993.  The terms proposed by your clients were described to me by Warren Radler on February 20, 1993.  My February 20th conversation with Mr. Radler is the only source of my understanding of your clients’ proposed terms.

The Original Draft included material terms [such as the representations in Section 4] that were not described to me by Mr. Radler [and to which I never agreed].  Therefore, these terms have been deleted from the Revised Draft. 

....

Please let me know by 4 p.m. on Tuesday, March 23, 1993, whether your clients require the terms from the Original Draft that have been deleted from the Revised Draft.  If they insist on having those terms, there can be no agreement.  I have advised Rivkin Radler & Kremer that if there is no agreement on the consulting arrangement by 4 p.m. on March 23, they are free to take all steps necessary to enforce Grove Fresh’s rights to the $2,000,000 settlement with your clients.  (emphasis added) 

Radler called me on the afternoon of March 23 to say that he had discussed my March 21st letter with defense counsel.  He reported that the defendants would not back off from their demands, and that if I continued to reject Section 4, the defendants would call off the settlement.  I told Radler that I would not subscribe to Section 4

On March 24, 1993, Radler and defense counsel met with Judge Zagel and discussed my refusal to subscribe to Section 4.  The meeting was off-the-record.  Neither I nor my counsel was invited to attend.  At the conclusion of the meeting Judge Zagel ordered me to appear in his chambers the following day at 9 a.m.

T. The conference in chambers on March 25, 1993.

The March 25th conference dealt with two issues.  First, Jeffrey Stone, one of Everfresh’s lawyers, announced that the previous afternoon Larry Walner had served Labatt and Everfresh with the summons and complaint in a class action lawsuit.  Stone said that his clients were putting the Grove Fresh settlement on hold so that they could determine whether I had instigated Walner’s suits. 

I informed the defendants and the court that in 1992, Walner had solicited me to work with him on orange juice class actions against Everfresh and Home Juice, but that I had declined his solicitation.  Subsequently, I gave the defendants an affidavit regarding Walner’s contacts with me.  Judge Zagel gave the defendants the right to take my deposition, but they waived that right after receiving my affidavit. 

The other issue addressed at the March 25th conference was my refusal to subscribe to the untrue representations in Section 4 of the defendants’ draft.  Defense counsel made a presentation to Judge Zagel on this issue from which I was excluded.  I was then brought in for a private meeting with Judge Zagel, without a court reporter. 

Judge Zagel told me that the Consulting Agreement did not violate the Rules of Professional Conduct, but he did not explain the basis for this opinion.  He then described what might happen if the settlement failed to close because of my objections to the Consulting Agreement, and the case went to trial.  While Grove Fresh’s evidence on liability was strong, Judge Zagel said, its evidence on causation and damages was less so.  If the jury returned a verdict for less than the $2,000,000 now being offered by the defendants, or if the jury found that Grove Fresh had not proven damages, Grove Fresh would have a malpractice claim against me for the difference between $2,000,000 and the jury's verdict.  If Grove Fresh sued and obtained a judgment against me, the judgment would be a personal liability that could be executed against my personal assets. 

I did not reply directly to Judge Zagel’s statements about my exposure to a malpractice claim.  Instead, I told him that for the sake of settlement I had been willing to go along with the concept of a consulting agreement, but that the form of agreement tendered by the defendants contained several provisions that were unacceptable to me. 

To underscore my readiness to honor my February 20th commitment to Mr. Troy that I would sign a consulting agreement to facilitate a settlement, I tendered to Judge Zagel a two-page consulting contract that I had already signed, and which omitted the objectionable provisions from the defendants’ March 9th draft.  I stated that if the defendants' only objective was to preclude me from representing other orange juice claimants, they could accomplish their objective by executing this two-page agreement and then immediately putting me to work on an orange juice matter.  I then would have a conflict of interest that would preclude me from representing other orange juice claimants against the defendants.  

At this point I was sent from chambers while Judge Zagel met with defense counsel, Radler, and Crider.  I was ordered back into chambers about ten or fifteen minutes later.  By then defense counsel had received and reviewed my proposed, two-page form of agreement.  Defense counsel stated that my proposed form of agreement was not acceptable to them and ended the conference. 

Judge Zagel’s statement about malpractice was material to me because he had jurisdiction to adjudicate any dispute that might arise over my right to share in the proceeds of any recovery by Grove Fresh.  If I had persisted in my refusal to sign the Consulting Agreement and was then discharged by Grove Fresh, I would lose my right to collect my contingent fee.  See authorities discussed in §V-E, above.  Moreover, I would also have lost my right to a quantum meruit claim to share in the proceeds of Grove Fresh’s ultimate recovery if my discharge was deemed to be with cause.  Id.

U. Radler’s request that I sign the Consulting Agreement in exactly the form proposed by the defendants. 

Immediately after the March 25th conference in chambers was concluded I met with Troy, Radler and Crider. I reported to Radler and Crider Judge Zagel’s statements about my exposure to a malpractice claim of up to $2,000,000.  Troy reiterated his plea that I enter into the consulting agreement so that the case could be settled.

Radler proposed a strategy for countering the defendants' posture that the filing of the consumer class action was grounds for reconsidering whether to settle with Grove Fresh.  Invoking the principles of offer and acceptance, Radler proposed that Grove Fresh and I should accept without change the most recent forms of agreements submitted by the defendants.  In my case, this meant accepting the original, March 9th version of the Consulting Agreement.  Grove Fresh and I, Radler said, should execute those offers in exactly the form submitted by the defendants.  If the defendants failed to honor these acceptances, Radler stated, Grove Fresh would file a motion for specific enforcement of the settlement offer it had accepted. 

Radler asserted that I owed a professional duty to Grove Fresh to take whatever steps were necessary to ensure the closing of the settlement.  Radler did not make any explicit statements about malpractice.  Nevertheless, his assertion that I owed Grove Fresh a duty to execute the Consulting Agreement implied to me that if the settlement fell through, he would advise Grove Fresh to discharge me and then either to resist my claim for quantum meruit or else to sue me for malpractice. 

After Radler finished his speech, I laid out my concerns about the Coalition’s appeal, which are described above in §R-2.  Radler assured me that if the appeal resulted in a referral to the ARDC, he would defend me pro bono

I then signed the March 9th draft of the Consulting Agreement in exactly the form that it had been submitted by the defendants.  Troy signed the most recent version of the Settlement Agreement that he had received from the defendants.  Radler sent these executed documents to the defendants on the afternoon of March 25.  That same day Radler filed an emergency motion to enforce the settlement contract. 

The defendants eventually contacted Grove Fresh and negotiated further changes to the Settlement Agreement.  Troy signed the final draft on April 9; the defendants signed shortly afterwards.  The settlement was closed on or about April 13, 1993.  At the defendants’ insistence, however, the Settlement Agreement was dated “as of March 25, 1993”—the date on which I signed the Consulting Agreement 

V. Escrowing the initial $50,000 installment of the consulting fee.

The Consulting Agreement required the defendants to make four $50,000 payments to me over the course of two years.  I received the first $50,000 shortly after the Grove Fresh settlement closed.  On April 20, I gave those funds to attorney Lee and instructed him to deposit the funds into an interest-bearing trust account.  I did this for two reasons. 

First, I felt that my consent to the Consulting Agreement had been coerced, and I wanted to preserve my right to avoid the agreement.  I escrowed the funds in order to demonstrate my intention not to accept the benefits of the contract.  Demonstrating such an intent would be an essential element of my burden of proof if I were to sue for rescission. 

Second, as discussed above in §R-2, I anticipated that the defendants, in opposing the Coalition’s challenge to the seal, would repeat in the Seventh Circuit the slanderous arguments they had presented in the district court.  I was concerned that if I accepted any benefits under the Consulting Agreement, I would compromise the credibility of any response to those attacks if they, in fact, occurred. 

On July 14, 1993, the 90c5009 defendants did as I feared; their defamatory attacks are described below in §XXV-D.

W. April 29 1993: Dismissal of the Grove Fresh litigation and authorization to remove the 90c5009 records. 

On April 29, Judge Zagel dismissed 89c1113, 89c1114, 89c1117, and 90c5009 with prejudice in accordance with the settlement agreement. 

Without notice to the Coalition, the defendants presented a motion to withdraw from the 90c5009 court file all records except the amended complaint, the answers, and the stipulated order of dismissal.  Judge Zagel granted that motion. 

X. May 5-11: Judge Zagel’s declaration that “[t]he defendant bought the case from the plaintiff.”

On May 5, Judge Zagel issued a two-page Opinion Clarifying A Prior Order Of Court—sixty days after the Seventh Circuit asked for it, and 30 days after the issue date requested by the Seventh Circuit.  The Opinion explained the grounds on which he had allowed the Coalition to intervene.  The Opinion also disclosed that “the parties to this case have been given leave to withdraw from the file all papers other than the Amended Complaint, the Answer and the Judgment of Dismissal.”

The Opinion Clarifying A Prior Order Of Court was the Coalition’s first notice that Judge Zagel would allow the defendants to remove the 90c5009 records from the courthouse.  On May 11, the Coalition moved in the district court for a stay of the removal of the records pending the outcome of its appeal.  Judge Zagel denied the motion with the following explanation:  

THE COURT:            There is as far as I am concerned no case.  The defendant bought the case from the plaintiff.  And absent some strong reason not to permit that, which nobody has brought to my attention, there is no case.  And the only decision – in fact, technically it is not, I think, a decision.  It simply confirmed what the parties have worked out.  And you are roughly in the same position as you were as if the case had never been filed in the first place

(5/11/93 Tr.6.)[emphasis added] 

Y. May 12, 1993: The clerk of court’s unexplained omission to create a docket for 90c5009. 

On May 12, the Coalition filed an emergency motion asking the Seventh Circuit to stay the removal of the records.  The Seventh Circuit granted the stay and set a briefing schedule on the merits of the appeal. 

For reasons that have never been explained, however, the clerk of the district court did not create a docket when he transmitted the 90c5009 records to the Seventh Circuit. 

[1] In November 1992 Dale Crider, Radler’s partner in the Grove Fresh litigation, had filed a brief in an unrelated case citing the Callahan holding that a contingent fee lawyer who is discharged without cause cannot recover his contingent fee, but, instead, is limited to a recovery in quantum meruit. See §XXII-E, above.

[2] In re Estate of Callahan, 144 Ill. 2d 32, 578 N.E.2d 985, 988 (1991).

[3] See Upgrade Corp. v. Michigan Carton Co., 87 Ill. App. 3d 662, 663, 410 N.E.2d 159, 161 (1st Dist. 1980). But see Annotation, Attorney’s Assertion of Retaining Lien as Violation of Ethical Code or Rules Governing Professional Conduct, 69 A.L.R. 4th 974, 984 (1989) (discussing ethical considerations in asserting lien where client has limited financial resources and files are vitally important to processing claim.)

[4] Apparently, attached to this order was a list of 34 “unavailable” documents that the court was seeking, but for unexplained reasons, that list was not attached to the copies of the order served on Grove Fresh or the Coalition.

[5] Grove Fresh’s papers in support of the Coalition’s claims are described above in §§XIX-A-4, 9, 11.

[6] For further information about the related criminal case, see Memorandum 3-A, §§IX-D, F, G; Memorandum 3-C, §XIX-H.

[7] As noted earlier, the May 1990 Retainer Agreement created a joint venture between Rivkin Radler & Kremer and me. As joint venturers Rivkin Radler & Kremer and I owed each other the duties of a fiduciary.  In re Johnson, 133 Ill. 2d 516, 525-26, 552 N.E.2d 703, 707 (1989); Holstein v. Grossman, 246 Ill. App. 3d, 616 N.E.2d 1224, 1236-37 (1st Dist. 1993).  As joint venturers Radler and I had a duty to deal with each other in good faith, to act for the benefit of the other as to matters within the scope of the contingent fee agreement, and also to make a complete disclosure to the other of all matters affecting the venture.  Each of us became entitled to a formal account as to the operations and affairs of the joint adventure.

[8] See §§XXV-C, XXVI-Q, below.

[9] If the settlement closed in accordance with the March 9th draft, as modified by Crider’s March 10th letter, the district court would dismiss all of the Grove Fresh cases with prejudice.  The final judgments in 89c1113 and 90c5009 would moot the motion to dismiss the Coalition’s appeal for lack of ripeness; that appeal would then go forward.

[10] In the late 1980s and early 1990s, the Seventh Circuit regularly published opinions which identified by name attorneys who had engaged in professional misconduct.  E.g., Smith v. Blue Cross & Blue Shield, 959 F.2d 655, 659 (7th Cir. 1992); Greening v. Moran, 953 F.2d 301, 306 (7th Cir. 1992); Maciosek v. Blue Cross & Blue Shield, 930 F.2d 536, 541 (7th Cir. 1991); Melrose v. Shearson/American Express, Inc., 898 F.2d 1209, 1217 (7th Cir. 1990); Hapaniewski v. City of Chicago Heights, 883 F.2d 576, 578-79 (7th Cir. 1989).

[11] The Commission monitors the press for reports of attorney misconduct. 

[12] Prior to the February 19th settlement conference the Seventh Circuit, believing that the 90c5009 case file was missing, ordered the parties to re-create the record by submitting certified copies of the missing papers.  Radler had allowed the defendants to exclude Grove Fresh’s papers from the re-created record on appeal. See §§H-J, above.

[13] This prohibition was embedded in §1 of the Consulting Agreement.

[14] This prohibition was also embedded in §1, which provided in pertinent part: “Messina will not disclose to anyone any information or documents relating to the business and activities of the Hiring parties and any of their present or former affiliated companies, officers, employees, agents, successors or assigns.”

[15] This requirement was embedded in §7, which provided that “at the [defendants’] request in [their] sole discretion, Messina agrees to deliver promptly to the [defendants] all manuals, letters and correspondence, notes, notebooks, reports, computer programs and similar items, memoranda, business records, and all other materials and all copies thereof relating in any way to the [defendants’] businesses and in any way obtained by Messina before or during the period of engagement with the [defendants] which are in his possession or under his control.” 

[16] This prohibition was embedded in §2, which provided: “Messina agrees that the existence or terms and conditions of this Agreement shall be considered confidential.  Messina specifically represents that he has not disclosed the existence or terms and conditions of this Agreement, and agrees that he will not disclose the terms and conditions of this Agreement unless required to do so by a court of competent jurisdiction.  Any breach of this confidence shall be a material breach of this agreement.”