Lowis & Gellen LLP | Current News

Lowis & Gellen Attorney to be Panelist at CBA Business Acquisition Seminar

2007-02-05T08:23:00.000-08:00

Robert Leavitt, a member of Lowis & Gellen’s Corporate Practice Group, will be participating as a panelist in the Chicago Bar Association seminar, Negotiating The Asset Purchase Agreement For The Sale Of A Business. The seminar will be held on February 8, 2007, at the CBA’s headquarters at 321 S. Plymouth Court, from 3 pm to 6 pm.

The seminar is about how to successfully negotiate an Asset Purchase Agreement for a client who is selling or buying a business. Mr. Leavitt and five other panelists will conduct an improvised mock negotiation using a hypothetical sale of a privately-held business. In the course of three hours, the seminar will highlight the key issues commonly raised during such a negotiation and practical ways to resolve them.

Lowis & Gellen’s Corporate Practice Group represents public and private companies in connection with a wide variety of transactions, including mergers, stock purchases and asset acquisitions, divestitures, leveraged buyouts, restructurings and other transactions involving changes in corporate control. For more information on the CBA seminar or Lowis & Gellen’s Corporate Practice Group, please contact Robert Leavitt at rleavitt@lowis-gellen.com or (312) 628-7199.

Retired Judge Joins Lowis & Gellen

2007-01-25T14:36:00.000-08:00

Judge David R. Donnersberger (Retired) joins the firm after 20 years on the bench in Cook County. He was a civil and criminal trial attorney and Assistant State’s Attorney prior to his term in the judiciary and will counsel clients in commercial litigation and in the settlement of arbitration and mediation actions.

Three Lowis & Gellen Attorneys Named Illinois “Super Lawyers 2007”

2007-01-18T13:44:00.000-08:00

Partners Pam Gellen, Gerald Haberkorn and Joan M. Kubalanza were recently announced to be among the top 5% of Illinois attorneys and are honored with the designation of “Super Lawyers 2007.” In independent research conducted by Law & Politics, 47,000 Illinois attorneys statewide were polled for their recommendations of colleagues in the law having outstanding skill as legal counselors and advocates.

Ms. Gellen has previously been named by Chicago Lawyer magazine as one of Chicago's top twenty tort defense lawyers and was first selected as an Illinois “Leading Lawyer” in 2005.

Mr. Haberkorn was a finalist in Fast Company magazine’s 2005 “Fast 50,” as one of the U.S.’s “high impact legal leaders” and was also one of Illinois’ “Leading Lawyers” in 2005.

Ms. Kubalanza is a former Associate Judge of the Circuit Court of Cook County, and a senior litigator and appellate attorney in the commercial litigation group at Lowis & Gellen, LLP.

Lowis & Gellen Real Estate Practice Group attorneys to speak at March seminar

2007-01-18T09:31:00.000-08:00

David L. Grobart and David C. Ansani, attorneys in Lowis & Gellen’s Real Estate Practice Group, will be presenters at an upcoming continuing education seminar on the complex and multifaceted business of real estate development.

“Real Estate Development from Beginning to End,” sponsored by Lorman Education Services, will be held on Friday, March 23, 2007 at 1801 N. Naper Boulevard, Naperville, IL.

Seminar highlights will include:

· Deal terms in the letter of intent
· Preconstruction leasing
· Development and redevelopment opportunities
· A financing primer
· Shopping center redevelopment

This program is designed for attorneys, business owners, lenders, surveyors, project managers, real estate agents and brokers and other professionals involved in the commercial real estate development process.

The Lowis & Gellen Real Estate Practice Group represents clients in all aspects of complex commercial real estate transactions. If you would like more information, please contact David Grobart at dgrobart@lowis-gellen.com or by phone at (847) 282-1201.

EARLY AGGRESSIVE WORKUP LEADS TO AN EARLY DISMISSAL FOR LOWIS & GELLEN CLIENTS

2006-11-14T08:48:00.000-08:00

Lowis & Gellen Partners Pamela Gellen and Scott Wolfe recently represented several psychiatrists and other healthcare professionals at a Chicago teaching hospital. The clients were accused of committing psychiatric malpractice. Moreover, the plaintiff in the case is a psychiatrist at another psychiatric teaching hospital in Chicago. The plaintiff alleged that the mistreatment, including the administration of electroconvulsive therapy a/k/a shock therapy, caused him to loose his psychiatric practice, teaching appointment, led to licensure and regulatory problems and other damages. Lowis & Gellen aggressively worked up the case performing internal investigations, interviews with staff, a comprehensive investigation into the plaintiff's background and analysis of employment records and medical records for the plaintiff psychiatrist. Based on the investigation, firm Partners Pam Gellen and Scott Wolfe filed Motions challenging the adequacy of the lawsuit on several grounds. After multiple briefs and hearings, the Judge agreed with Pam and Scott and dismissed the lawsuit before their clients even had to give a deposition.

For more information regarding the case or for general information on psychiatric malpractice, please contact Scott Wolfe at swolfe@lowis-gellen.com.

TRIAL VICTORY FOR LOWIS & GELLEN PARTNERS BEFORE ANY EVIDENCE

2006-11-14T08:26:00.000-08:00

On October 18, Judge Carol Pearce McCarthy of Cook County, Illinois dismissed a lawsuit during trial but before any evidence was presented to the jury. Lowis & Gellen partners Mark Smith and Scott Wolfe represented a Family Practitioner accused of failing to diagnose lymphoma, a cancer of the lymphatic system. The plaintiff alleged that the doctor was her primary care physician and had failed to properly evaluate abnormalities on mammograms which would have lead to the diagnosis of her lymphoma. During the course of discovery before trial, firm Partners Mark Smith and Scott Wolfe retained world renown experts in the fields of family practice and oncology, and obtained supportive testimony from the plaintiff's treating physicians. During motions at the beginning of the case Judge McCarthy found Lowis & Gellen's defense so overwhelming she would not allow the trial to proceed any further and dismissed the case on the day of opening statements.

For further information in this case or on Lowis & Gellen's professional malpractice defense group, please contact Mark Smith at msmith@lowis-gellen.com or Scott Wolfe at swolfe@lowis-gellen.com.

Another appellate victory for Lowis & Gellen LLP's Appellate Lawyers.

2006-10-31T07:19:00.000-08:00

In the trial court, Lowis & Gellen partner Mark Smith represented a physician in a case tried to verdict involving the death of a two year old girl. A pharmacy, named as co-defendant, settled prior to trial, paying $90,000. At trial, the girl's mother testified that she had administered viscous lidocaine to her daughter by mouth. The issue in the case was whether the defendant doctor had properly instructed the mother on how the medication was to be administered. The doctor testified that he had told the mother to administer the medication by applying it to the sores in the girl’s mouth with a Q-Tip. The mother testified that she received no such instruction, even though the first time she administered the medication, she administered it using a Q-Tip. A verdict was returned in favor of the plaintiff with the jury finding that the defendant doctor and mother were both 50% negligent. A judgment was entered in favor of the plaintiff in the amount of $75,000, but this amount was subject to a set off in the amount of the co-defendant's prior settlement, resulting in a net obligation of $0 for Mark Smith's client. This award was not based on any evidence as to economic damages but was solely for the loss of society suffered by the parents and three siblings.

The plaintiff was dissatisfied with the jury's award of damages and moved for a new trial. Joan M. Kubalanza, also a partner at Lowis & Gellen, wrote the Defendant's Response to the Plaintiff's Motion for a New Trial and won in the trial court. The plaintiff appealed and Joan along with Mehreen S. Sherwani wrote the Appellee's Brief. The Appellate Court affirmed the trial court's denial of the request for a new trial on October 27, 2004.

Reaching Abroad to Maintain an Edge

2006-09-26T08:40:00.000-07:00

Lowis & Gellen Associate Patrick Moran was recently invited by the British American Business Council to take a five-day seminar offered by the University of Chicago's Executive Education program at the school's London campus. The course, “Financial Analysis for Non-financial Managers,” focused on interpreting data from financial reports, understanding financial principles and using financial language to communicate with others. Although the course covered a variety of topics relevant to corporate managers, it also provided an excellent foundation of the accounting and financial principles often involved in commercial litigation which comprises a large part of Pat’s practice. Partner Gerald Haberkorn says, “We continue to be proud of Pat’s accomplishments and his continuing efforts to cement exisitng cross-border relationships for Lowis & Gellen clients.”

L&G gets TRO Against Former Employee of Client

2006-09-11T09:17:00.000-07:00

Rob Smeltzer and Kevin Clancy recently obtained a temporary restraining order and then a preliminary injunction: (1) precluding a former employee from soliciting the prospective customers of its client (a national insurance brokerage); and (2) compelling the former employee to return to our client all of information in his possession regarding customers or actual customers. The litigation also included the former employee's new employer (a competitor of our client), which terminated him shortly after the suit was initiated. The case was brought under the federal Computer Fraud and Abuse Act and the California Trade Secrets Act and, in addition, based on certain restrictive covenants the former employee made to our client. This victory is of particular note because the restraining order and injunction were obtained in the U.S. District Court for the Northern District of California and California is notorious for its refusal to enforce employee non-solicitation clauses.

The key to success was performing a fast computer forensic analysis of the former employee's laptop, which showed that he had, immediately prior to his resignation, deleted all of the prospective customer information on the laptop and then "defragmented" its hard drive so that our client could not recover it. Further analysis revealed that the employee had ceased entering prospect information into the employer's databases several weeks prior to resignation, which suggested that he had planned to quit and deprive his employer of the fruits of his labor well in advance thereof. Messrs. Smeltzer and Clancy were also able to obtain certain emails the former employee had sent to his future employer while still employed by our client. These emails showed that the former employee had, while still employed by our client, communicated sensitive information about it to its competitor. The former employee attempted to argue that because he personally developed and paid for the information about prospective customers, he had a legal right to take it upon resignation. We were able to get the Court to reject that argument on the basis that all information developed by an employee on the employer's time belongs to the employer. For more information about this case, please contact Rob Smeltzer at (312) 456-7952.

Taking Control: Managing Your Malpractice Lawsuit.

2006-09-08T07:23:00.000-07:00

On September 7, 2006 Partner Vito Masciopinto participated as a panel member for a seminar for physicians entitled Taking Control: Managing Your Malpractice Lawsuit. The seminar was designed to help the physicians understand the litigation and claims management process as well as to assist them in dealing with the emotion aspect of being a defendant in a lawsuit. If you would like information about any of the above topics please contact Vito Masciopinto at vito@lowis-gellen.com.

London Colleague Visits Chicago Office

2006-09-07T07:41:00.000-07:00

Ensuring superior legal services for our clients with international commercial interests, Lowis & Gellen maintains a close working relationship with Wragge & Co., a well-respected, London-based law firm. Paula Laird, a Wragge & Co. partner, recently visited L&G and some Chicago-area clients. Ms. Laird’s practice focuses on asset based financing in the UK and Europe, which compliments our expertise. She is particularly expert in advising companies interested in cross-border loan transactions in Europe, or requiring assistance with corporate finance issues in UK or Europe.

For more information on how Lowis & Gellen can assist your company with the finance or commercial matters in the U.S., U.K. or Europe, please contact our partner Gerald Haberkorn at 312-456-2701 or gerald@lowis-gellen.com. For more information about Wragge & Co., click here.

Lowis & Gellen Conducts Seminars on Pitfalls and Issues on Taking Security for Loans in Europe and the U.S.

2006-08-24T14:29:00.000-07:00

On August 15, 2006, Lowis & Gellen conducted a catered one-hour lunch seminar for LaSalle Bank’s International Corporate Banking group. Speakers at the seminar included Robert Leavitt, Of Counsel to Lowis & Gellen, who talked about the pitfalls and issues on taking security for loans in the U.S., Kevin Clancy, Associate Attorney with Lowis & Gellen, who talked about lender liability in loans with junior lenders, and Paula Laird, Partner with the U.K. firm, Wragge and Co., who spoke about pitfalls and issues on taking security in European loans. The well-attended seminar was held at LaSalle Bank’s Chicago headquarters.

Two days later, Lowis & Gellen hosted another catered one-hour lunch seminar, this time for the Cross Border Finance Group of LaSalle Business Credit, LLC, a LaSalle Bank affiliate. Mr. Leavitt and Ms. Laird both spoke at this seminar on the same topics as at the prior seminar. This second seminar, also well attended, was held at Lowis & Gellen’s Chicago office in their new conference facilities.

For more information, or if you would be interested in having Lowis & Gellen conduct a similar seminar for your business’ personnel, please contact:

Gerald Haberkorn
(312) 456-2701
geraldh@lowis-gellen.com

Documentation Workshop

2006-07-21T13:57:00.000-07:00

On July 18, 2006 firm partner Vito Masciopinto and Dr. John Hobbs an obstetrician at Northwestern Medical Center led a workshop on physician documentation at Seven Bridges conference center in Woodrige Illinois. The workshop was focused on documentation techniques for physicians in an effort to reduce the risk of malpractice claims.

ICSC

2006-07-19T14:29:00.000-07:00

Firm Partner, David Grobart, will lead a roundtable discussion during the International Council of Shopping Centers Law Conference this October 25-28, in Orlando, Florida. David will be discussing Redevelopment Issues for Existing Retail Properties: Evaluating and Solving Potential Issues. The Lowis & Gellen Real Estate Practice Group represents clients in all aspects of complex commercial real estate transactions. If you would like more information on this upcoming event or regarding the firm’s Real Estate Practice Group, please contact David Grobart at dgrobart@lowis-gellen.com or by phone at (847) 282-1201.

LOWIS & GELLEN LLP WELCOMES PETER S. YUH AS AN ASSOCIATE IN THE DEERFIELD OFFICE

2006-07-18T07:13:00.000-07:00

Lowis & Gellen LLP announces that Peter S. Yuh has joined the firm’s Real Estate Department as an associate in its Deerfield office. His practice focuses on commercial real estate matters. Prior to joining Lowis & Gellen LLP, Mr. Yuh worked for the City of Chicago where he was involved in, among other work, municipal prosecutions, ordinance compliance enforcement, and consumer fraud investigations.

Mr. Yuh received his undergraduate degree (B.A., 1997) from Northwestern University and his law degree (J.D., 2005) from Loyola University Chicago, School of Law, where he was managing editor of and published in the Loyola University Chicago, International Law Review. He is admitted to practice in Illinois, as well as before the U.S. District Court for the Northern District of Illinois.

Verdict in favor of all defendants in Will County!

2006-07-10T12:19:00.000-07:00

Partner Robert H. Smith, assisted by attorney Megan Inskeep, recently scored a victory in Joilet, following a two-week trial before Judge O'Leary. Mr. Smith and Ms. Inskeep represented a radiologist in a wrongful death action, involving the tragic death of a 2-month old from heart disease. Two other pediatricians were also sued. Plaintiff sought $2 million in damages, but the jury returned a verdict in favor of all defendants. An offer of settlement had been made prior to the trial, but was declined by the family. Congratulations to Bob and Megan!

Brian Levin Obtains Not Guilty Verdict for Hospital Client

2006-07-07T10:15:00.000-07:00

Firm Partner, Brian Levin, recently obtained a not guilty verdict for one of the firm's hospital clients, following a 2 week jury trial in a medical malpractice action brought against the hospital and a co-defendant cardiologist. The case involved allegations that, after suffering a heart attack, the patient was prematurely discharged from the hospital and given inappropriate discharge instructions. The jury, after 7 days of testimony and after deliberating for almost five hours, found in favor of both defendants. Brian Levin and the firm routinely represent hospitals, physicians, medical service providers and their insurer's in complex medical malpractice defense claims. For more information on this matter or regarding the firm's medical malpractice defense practice, please contact Brian Levin at blevin@lowis-gellen.com or by phone at 312-456-8774.

Another Milestone

2006-07-05T09:00:00.000-07:00

Lowis & Gellen LLP is celebrating the first anniversary of our Deerfield office and the rapid growth it has enabled our Real Estate Practice Group to experience. In particular, we are excited about the addition of two very capable attorneys to our real estate group, Peter Yuh and Melissa Dakich, both formerly attorneys for the City of Chicago. It continues to be our goal to provide responsive and superior service, creative solutions to closing deals, and effectively getting things done on time and within budget. For more information about our commercial real estate legal services and Real Estate Practice Group, please contact David L. Grobart at dgrobart@lowis-gellen.com or (847) 282-1201.

Lowis & Gellen Client Sells its Business

2006-06-20T12:29:00.000-07:00

Lowis & Gellen represented the sellers (the "Sellers") in the sale of their educational services business located in Illinois to the nation's leading provider of on-demand digital media solutions for schools. This all cash transaction involved the sale of the Seller's stock in the business. Additional details of the sale are included in the buyer's press release, viewable by clicking here.

A leader in K-12 educational media publishing for more than 85 years, the Sellers' business has won numerous awards for its products, which include videos, DVDs, CD-ROMs, and its media-on-demand internet-based system. With standards-based programs in all core disciplines - language arts, social studies, math, science, guidance, health, art, and music - the business provides content in a full range of formats tailored for use in today's classroom.

The Lowis & Gellen team consisted of Gerald Haberkorn, Robert Leavitt, and Mehreen Sherwani, who exclusively handled for the Sellers all legal aspects of the transaction including the structuring, drafting and negotiating of the sale, escrow, consulting and non-competition documentation.

For more information, please contact:
Gerald Haberkorn, (312) 456-2701
Geraldh@lowis-gellen.com

Snapshot of First Quarter Deals Concluded

2006-04-20T14:08:00.000-07:00

Lowis & Gellen Corporate Transactions attorneys continue to close significant deals. Here's a sampling of the types of transactions closed between December 2005 and April 2006:

Spinning Off Assetts

Restructured Ownership

Selling the Company

Rail Line Acquisition

Client Purchases Eleven Locomotives

Florida Client Sells Diverse Business

Amending Contract Creates Surprising Problem

2006-03-31T13:25:00.000-08:00

Joan M. Kubalanza and Kevin J. Clancy, two of Lowis & Gellen's senior litigators and appellate attorneys, have published an article in the March issue of the Illinois Bar Journal that carries a strong admonition for practicing attorneys and business clients. The article discusses the case of Nebel, Inc. v. The Mid-City National Bank of Chicago, decided by the First District of the Illinois Appellate Court. The case dealt with a substantive amendment to an existing contract and the trial court's finding that the act of amending the 99-year lease revived a dormant clause requiring the payment of rent in gold. The legal moral of the story is that attorneys should familiarize themselves with the contract being amended in every instance, and specifically exclude any unwanted provisions from the original contract. Copies of the article can be obtained by contacting Amy Bockman at 312-364-2500.

Client and Community Elated With Outcome

2006-03-24T10:19:00.000-08:00

David Grobart, Partner in charge of the firm's Real Estate Practice Group, recently obtained unanimous approval from a suburban Chicago municipality to not only keep, but expand the presence of his client, one of the nation's leading "big-box" retailers, within their principal regional shopping center. Mayor Kyle Hastings of Orland Hills, IL declared the agreement and project to be "one of the biggest economic developments in the village's history." The community will receive the continuing benefits of substantial sales tax and property tax revenues from a revitalized shopping center development and a newly constructed facility with a building containig over 200,000 square feet. The development also currently includes Circuit City, PetSmart and World's Finest Chocolate, as well as outparcel restaurants and other users.

APPELLATE VICTORY

2006-03-24T09:32:00.000-08:00

Lowis & Gellen appellate attorneys recently prevailed on behalf of a doctor, his medical practice and his staff, when the First District Court of Appeals affirmed the trial court's ruling that a minor plaintiff's medical malpractice claim was barred by an eight year statute of repose. The claim, brought by parents on behalf of their son, alleged that the boy was injured in utero when his mother ingested a toxic dose of a dietary supplement provided to her by the defendants. Plaintiff alleged that the defendant doctor prescribed L-glutamine protein powder to treat the mother's allergies, but erroneously provided her with Selenium in a bottle marked L-glutamine, which the mother ingested during her pregnancy.

The First District Appellate Court did not allow oral argument on the matter, but relied instead upon the strength of the appellate briefs. Joan Kubalanza and Deborah O'Brien argued in the defendants' brief that the medical malpractice statute of repose, rather than the ordinary negligence statute, applied because the plaintiff's claim arose out of patient care. Defendants argued further that the statute of repose barred the action because the minor plaintiff's mother ingested the allegedly harmful substance more than eight years before the minor's claim was filed.

The appellate court rejected the plaintiff's argument that the minor was under a legal disability sufficient to toll his cause of action while a fetus, holding that the statute of repose was not tolled because the minor was not under any legal disability at the time that his cause of action accrued (at birth).

European Review

2006-03-24T09:19:00.000-08:00

Industry experts agree that 2005 was a vintage year for the markets and deal-makers alike. The good news is that many see no reason why this shouldn't contine in 2006.

Click here to read full article

Rob Smeltzer Successfully Obtains Temporary Restraining Order

2006-03-24T09:12:00.000-08:00

"Rob Smeltzer successfully obtained a temporary restraining order ("TRO") in Cook County Circuit Court on behalf of an insurance brokerage client in a restrictive covenant case. The TRO precludes our client's (an insurance brokerage) former employee from soliciting his former customers. The former employee argued that the insurance brokerage did not have a "protectible interest" in or "near permanent relationship" with the customers that the former employee had brought to the brokerage. The former employee also argued that the restrictive covenant lacked consideration and that the existence of a liquidated damage provision in the employment contract containing the restrictive covenant meant that injunctive relief was inappropriate and that there was an adequate monetary remedy for breach of the covenant. In rejecting this argument, the Court held that the insurance brokerage did have a protectible interest in its confidential information and trade secrets (e.g. premium information, amount of commission, policy expiration and renewal information) concerning those customers, such that the former employee would be able to unfairly compete with the insurance brokerage in the absence of an injunction. The Court further found that the restrictive covenant was narrowly drawn to promote this protectible interest."

Appellate Victory

2006-03-07T09:45:00.000-08:00

Lowis & Gellen Appellate Practice attorneys recently prevailed on behalf of three Will County Correctional Officers. A Department of Corrections inmate brought a federal civil rights action against the three officers alleging violations of his civil rights under the First, Fourth, Eighth and Fourteenth Amendments, as well as state law claims of assault and battery. The plaintiff alleged that when he was a pre-trial detainee the defendants illegally searched his mail and used excessive force against him. The trial court dismissed the claims on the basis that the plaintiff had failed to demonstrate that he had exhausted his administrative remedies. The Third District Appellate Court did not allow oral argument on the matter but relied entirely on the strength of the appeal briefs. Joan M. Kubalanza and Melissa Dakich argued in the officers' brief that the plaintiff could not cure on appeal the defects in his underlying complaint and the Court subsequently affirmed the trial court's decision.

Defense Argument Defeats Motion for New Trial in Medical Negligence Case

2006-02-23T08:46:00.000-08:00

Lowis & Gellen partner Mark Smith represented the defendant physician in a case tried to verdict involving the death of a two year old girl. A pharmacy, named as co-defendant, settled prior to trial, paying $90,000. At trial, the girl's mother testified that she had administered viscous lidocaine to her daughter by mouth. The issue in the case was whether the defendant doctor had properly instructed the mother on how the medication was to be administered. The doctor testified that he had told the mother to administer the medication by applying to it to the sores in the girl’s mouth with a Q-Tip. The mother testified that she received no such instruction, even though the first time she administered the medication, she administered it using a Q-Tip. A verdict was returned in favor of the plaintiff with the jury finding that the defendant doctor and mother were both 50% negligent. A judgment was entered in favor of the plaintiff in the amount of $75,000, but this amount was subject to a set off in the amount of the co-defendant's prior settlement, resulting in a net obligation of $0 for Mark's client. This award was not based on any evidence as to economic damages but was solely for the loss of society suffered by the parents and three siblings.

The plaintiff was dissatisfied with the jury's award of damages and moved for a new trial. Joan M. Kubalanza, also a partner at Lowis & Gellen, wrote the Defendant's Response to the Plaintiff's Motion for a New Trial. Joan argued that in a case involving the award of non-economic damages, such as involved in this case, the award of damages is peculiarly a question of fact for the jury and that the jury's decision in such cases should not be disturbed, especially when there are no allegations of improper jury instructions or other trial errors. The trial court agreed with the arguments made in the defendant's response brief and denied the plaintiff's motion for a new trial.

2006-02-14T14:34:00.000-08:00

Kevin Clancy recently obtained a preliminary injunction in the Federal District Court for the Northern District of Illinois for one of Lowis & Gellen, LLP's financial institution clients. The Court enjoined two defendants from filing a fraudulent U.C.C. Financing Statement in any U.S. jurisdiction , which the defendants threatened to file and which would have reflected falsely that defendants had a $128 million security interest and judgment against our client. The complaint that was filed in the case contains allegations of fraud and violations of the RICO statute. Kevin was assisted in this matter by Dan Marko, an associate at Lowis & Gellen, LLP and Joan Kubalanza, a partner with the firm.

24th Annual Nurse Attorneys Association Conference

2006-02-14T14:30:00.000-08:00

Lowis & Gellen health law attorney Shellie Karno led two sessions of the 24th Annual Nurse Attorneys Association Conference held recently in Chicago. Shellie organized, coordinated, and moderated a panel of health care professionals presenting their perspectives on the volatile issue of tort reform. The program was titled "A View From All Sides" and the commentators included Max Brown, General Counsel of Rush-Presbyterian-St. Lukes Medical Center, for the hospital side of the issue, Theresa Hoban, General Counsel of Northwest Community Hospital, on policy perspective, and Robert Stalker of Hub International presenting the insurance industry perspective. Mark Smith, a Lowis & Gellen partner, presented the defensive perspective, and Allen Schwartz presented the plaintiff's perspective.

In an additionional presentation, Shellie addressed the Advanced Practice Nurse Section of the Association on the hearing and appeals provisions of the Illinois Nursing and Advanced Practice Nursing Act entitled "Defending Your License." Advanced Practice nurses are RNs with additional certification who work under the aegis of corroborating agreements and physicians. Shellie's programs were both CLE and NEC certified for attendees.

New Attorneys: Daniel Marko, Jamie Field, and Elizabeth Smith

2006-02-14T14:13:00.000-08:00

Lowis & Gellen is growing again with the hire of three attorneys. Dan Marko, a commercial litigation lawyer with five years of practice experience and one year as a Judicial Extern to the US. District Court for the Northern District of Illinois, joins the Corporate Transactions and Litigation Practice. Jamie Field worked with L&G as a law clerk and is now an associate attorney in the Medical Malpractice Litigation Group, following her graduation from The John Marshall Law School (J.D., June 2005); and, Elizabeth Smith, a 2005 graduate of the DePaul University College of Law, who also joins the MedMal Litigation Group.

Please see their bios in the "Our Attorneys" section of the website.

The Decalogue Society of Lawyers' "Award of Merit"

2006-02-14T14:07:00.000-08:00

Lowis & Gellen attorney Shellie Karno presided over the Decalogue Society of Lawyers "Award of Merit" Dinner on November 29. As President of the bar association, it was her honor to have Judge William D. Maddux, Presiding Judge Law Division, Circuit Court of Cook County, present the Merit Award to Illinois Supreme Court Chief Justice Robert R.Thomas. Approximately 200 guests were in attendance, and at least half of that number were judges and other dignitaries or special guests, including retired Illinois Supreme Court Justice Seymour Simon.

In his response, Chief Justice Thomas spoke about the recent Supreme Court rule requiring mandatory Continuing Legal Education for Illinois attorneys, and recognized the Decalogue Society of Lawyers for the Legal Education Series that the Society has been providing for over 50 years. He also addressed the Court's recent establishment of a permanently appointed Commission on Professionalism, and added a few comments about his years with the Chicago Bears.

Chief Justice Thomas joins a prestigious group of national and international luminaries to whom this award has been given in the past. Previous recipients include U.S. Supreme Court Justice Ruth Bader Ginsberg, former President Harry S. Truman, Dr. Jonas Salk, Sir Georg Solti, Saul Bellow, and Albert Einstein.

Scott Wolfe and the DuPage County Medical Society

2006-02-14T14:05:00.000-08:00

Scott Wolfe recently spoke at a seminar sponsored by the DuPage County Medical Society on liability theories plaintiff attorneys may use to circumvent the new Illinois tort reform statute. The seminar, held at Central DuPage Healthcare in Winfield, Illinois, was attended by physicians and practice managers from throughout the west suburbs of Chicago.

For more information regarding the presentation, please contact Scott Wolfe at: 312-456-2709.

Focus on Transatlantic Deal-Making

2005-12-20T15:35:00.000-08:00

An upturn in the global M&A market means that cross-border transactions are becoming more and more frequent. ACQ explores the legal technicalities involved in completing a deal of this nature.

Read More:
Page 1

Page 2

US News & World Report

2005-12-20T15:25:00.000-08:00

Congratulations are in order for our litigation partner Joan M. Kubalanza who teaches legal writing and appellate advocacy as a member of the Adjunct Faculty at The John Marshall Law School in Chicago. US News & World Report just named The John Marshall legal writing program as tied for third best of all accredited U.S. law school writing programs. John Marshall shared this third place honor with Stetson University, out-ranking Michigan, Northwestern, Villanova, Brooklyn and Boston College in the Top 10 list of law schools. We are pleased to congratulate John Marshall on this honor and particularly commend Molly Lien, who leads the writing program at John Marshall. Molly has advised and counseled several Lowis & Gellen associates on effective legal writing.

At Last: Physician Credentialing and Malpractice Risk Evaluation for Hospitals

2005-12-20T15:19:00.000-08:00

While advising her client, Northwest Community Hospital, this fall, Shellie Karno, an attorney with Lowis & Gellen who is an R.N., lawyer, and former legal counsel to one of the largest teaching hospitals in the country, constructed a risk evaluation method that objectively considers the potential legal liability of any given physician.

Health care providers acknowledge that it is often difficult for hospital credential committees to objectively investigate and assess the potential for institutional liability incurred in granting physician privileges. Each hospital governing board has their own process and few instill confidence -- with the hospital board, medical peer review boards or the all-powerful Joint Commission on Accreditation. As a consequence, "negligent credentialing" has become a claim that juries are asked to consider more and more frequently in medical malpractice cases seeking additional damages from health care facilities that granted privileges to a defendant physician. Theresa Hoban, NHC General Counsel, extols the practical utility and objectivity of the process developed by Ms. Karno, as well as its virtue as a proactive rebuttal to claims of negligent credentialing should law suits ensue.

The proposed Malpractice Risk Evaluation Report utilizes the findings of research in medical malpractice liability including the Harvard Medical Practice Studies (involving a representative sample of 31,000 hospitalized patients from a group of over 2 million patients in New York State in 1984), a Health Policy Center study, and a retrospective cohort study of over 12,000 physicians sued in New Jersey between 1977 and 1991. It also integrates regulatory and corporate governance issues raised by the National Practitioner Data Bank, The Health Care Quality Improvement Act of 1986, and provisions and standards promulgated by the Joint Commission on Accreditation of Healthcare Organizations. Finally, and of equal importance, the process takes into consideration medical staff bylaws and hospital threshold criteria.

The methodology of malpractice risk evaluation that Ms. Karno has developed draws on independent data sources to provide basic legal history and licensure information about each physician and measures it against the objective criteria established in the academic research cited above. These criteria include classification of the risk of each area of specialty medicine; the physician's history of claims and years of practice; the resolution of past claims and the severity of the claimed disability, as well as other factors.

For additional details on the process, please contact Shellie Karno at 312-628-7856.

Commercial Lending Requirements and Loan Documentation in Illinois

2005-10-14T15:27:00.000-07:00

David Ansani, one of our veteran commercial real estate attorneys in the Deerfield office, spoke again last month in a seminar for lenders and attorneys on "Commercial Lending Requirements and Loan Documentation in Illinois." The program was hosted by Lorman Educational Services. David's well-attended presentation addressed security interests under the Uniform Commercial Code, security agreements, pledge agreements, control agreements, loan subordination and landlord/tenant issues.

Interested parties can contact David (847-282-1203) for information on additional up-coming presentations on commercial real estate development and management that are open to the public.

David Grobart to Speak at Chicago Bar Association Meeting

2005-09-12T15:21:00.000-07:00

David Grobart, partner with the firm Lowis & Gellen, LLP, addressed the Chicago Bar Association's Commercial Finance and Transaction Committee at its monthly luncheon meeting on September 15, 2005. Mr. Grobart spoke on how to assess restrictive covenants on the use of commercial real property when representing clients in the purchase or financing of such property.

For more information on the meeting or the topic discussed, please feel free to contact Mr. Grobart directly at:

(847) 282-1201
dgrobart@lowis-gellen.com

Robert Smeltzer elected as one of the "40 Under 40"

2005-08-29T15:13:00.000-07:00

Rob Smeltzer was recently selected as one of the "40 Attorneys Under Forty in Illinois to Watch" and profiled in the Chicago Daily Law Bulletin's sixth annual edition. This is quite an honor. Over 1200 nomination forms were scrutinized to find attorneys who had accomplished a lot in a short amount of time. Judges, attorneys from firms other than the nominee's own firms and clients were eligible to nominate, and only 40 made the final cut. Congratulations Rob!!!

Click here to read the article

ADDITIONAL OFFICE AND THREE NEW ATTORNEYS

2005-08-22T15:32:00.000-07:00

Chicago

Lowis & Gellen LLP, the corporate transactions, litigation and professional liability defense law firm, announced the opening of their Deerfield office with the addition of three senior real estate transaction and litigation attorneys. Previously forming the core of the commercial real estate boutique Grobart & Levick, LLC, David Grobart, Susan Eleff and David Ansani are now members of the real estate department of Lowis & Gellen. David Grobart joins the firm as a partner. He was senior counsel at Walgreens and has 20 years' experience in commercial and "big box" real estate development, acquisitions, leasing and construction lending.

Lowis & Gellen LLP, headquartered in Chicago, maintains an active practice throughout Cook County and the "collar counties," as well as Florida and London. All offices represent diverse business clients in domestic and cross-border commercial and finance transactions, negotiations and complex commercial litigation. The new Deerfield office is located at 500 Lake Cook Road, Suite 260. Phone is 847-282-1100.

According to David Grobart, "We have the same commitment to outstanding, extremely responsive, client service. Our ability to provide sophisticated commercial real estate representation, along with the existing expertise and varied practice areas at Lowis & Gellen, made this a perfect fit."

Gerald Haberkorn, head of Lowis & Gellen's corporate department said, "We had been looking for quality experienced real estate attorneys to serve both our national and international clients who are looking to expand throughout the U.S. Dave and his group fit that need perfectly."

Contact:
David Grobart: (847) 282-1201
Email: dgrobart@lowis-gellen.com

Gerald Haberkorn: (312) 364-2500
Email: gerladh@lowis-gellen.com

New President for The Decalogue Society of Lawyers

2005-07-11T15:26:00.000-07:00

Shellie Karno, a senior Lowis & Gellen health care lawyer, was installed as the 2005-2006 president of The Decalogue Society of Lawyers on June 21 st. The Society, founded 70 years ago to maintain high standards of conduct and legal education, has approximately 1000 members. The bar society sponsors a broad range of programs for practicing attorneys and law students, awards law school scholarships and an annual Merit Award to internationally renowned people for outstanding personal and professional achievements. In the Chicago area, The Decalogue Society is socially active in a number of pro bono publico and charitable projects and supports a variety of causes, including filing amicus briefs in cases which address public practices which are anti-social, discriminatory, or oppressive of human rights, minority interests and individual freedoms.

Ms. Karno has served The Decalogue Society as Second Vice President, First Vice President and as a member of the Executive Committee over the past four years. "Decalogue has a long tradition of promulgating ethical and non-discriminatory practices within the profession of law and society at large. These values are the cornerstones of our faith, as well as our society of lawyers," Ms. Karno said recently in an interview.

Board Appointment for Joan Kubalanza

2005-07-11T15:23:00.000-07:00

Litigation partner, Joan M. Kubalanza, was recently invited to join the prestigious Board of Directors of Literacy Chicago (www.literacychicago.org). A significant presence in the city, Literacy Chicago is dedicated to improving the literacy skills of Chicago-area adults and families through a variety of tuition-free classes and tutoring in reading, math, grammar and more. The Board is committed to providing their expertise and guidance to Literacy Chicago's organizational activities.

Not Guilty Verdict Obtained for Internal Medicine Physician

2005-06-14T07:24:00.000-07:00

On May 3, 2005, Mark Smith and Linda Lu obtained a not guilty verdict for an internal medicine physician and the physician corporation. The Plaintiff, a 49 year old female, went to an urgent care center with complaints of coughing, yellow phlegm, low grade fever, and shortness of breath for 2-3 days. She was diagnosed by the ER physician with acute asthmatic bronchitis and prescribed Zithromax (antibiotic) and Prednisone (steroid for asthma), with instructions to follow up with her physician in a few days. A few days later, the plaintiff saw the Defendant who was her internist. She told the Defendant about the urgent care visit, reported complaints of coughing, yellow phlegm, headache, and low grade fever, and reported she was "feeling better." Defendant diagnosed her with bronchitis. Because she did not know her dosage of Prednisone, the Defendant told the Plaintiff to finish her Prednisone and call his office if her symptoms recurred so that he could order a new prescription for tapering dosages of Prednisone. She finished her Prednisone and a few days later, the Plaintiff called the Defendant's office, as planned, and reported the same symptoms as her prior visit. Defendant ordered tapering dosages of Prednisone. Nine days later, the Plaintiff was admitted to the hospital with complaints of difficulty breathing for 3 days and rectal bleeding for 6 days. While in the hospital, Plaintiff developed endocarditis and died.

Plaintiff alleged Defendant was negligent in failing to prescribe an antibiotic when she called after her visit and received tapering dosages of Prednisone. Plaintiff alleged that an antibiotic could have prevented or cured her ongoing upper respiratory infection, which allegedly lead to pneumonia. Plaintiff contended pneumonia caused her endocarditis which caused her death. Defendants contended
the standard of care did not require a prescription of an antibiotic at that time. Plaintiff had a long history of chronic asthma and bronchitis, which was last successfully treated with a steroid in the absence of antibiotics. Her current complaints were consistent with a non-infectious bronchitis. Defendants further contended that Plaintiff never had community acquired pneumonia. Rather, Defendants
argued that she suffered a flare up of her underlying diverticulitis. The source of the infection causing her endocarditis and death was her GI tract problem, rather than pneumonia.

Judge Lynn Egan presided over the trial. The Plaintiff asked for $4 million in damages. The jury deliberated for less than three hours.

Not Guilty Verdict Obtained for ER Physician

2005-05-02T05:57:00.000-07:00

On March 21, 2005, Vito Masciopinto achieved a not guilty verdict for an emergency room physician and the physician corporation. The plaintiff, a 54 year-old man, presented to the Northwest Community Hospital Department on December 28, 2000 with complaints of numbness in his right arm, tingling of lips, and, by history, left arm and left shoulder pain. He denied chest pain or shortness of breath. The physician defendant examined the decedent, ordered a CT scan of the brain, and an EKG to rule out atrial fibrillation as cause of a potential transischemic attack. The EKG did not reveal atrial fibrillation, but was abnormal and suggestive of a prior myocardial infarction.

Finding no acute process, the physician discharged the decedent with a diagnosis of anxiety and parasthesias and instructed him to follow up with his physician. The decendent died on February 21, 2001, and autopsy revealed severe (95% blockage of major coronary arteries) coronary artery disease. Plaintiff alleged negligence for failure to consider a cardiac etiology of decedent's complaints (in light of the abnormal EKG) and for failure to arrange for cardiac monitoring before discharge. The defense argued that plaintiff was appropriately worked up for his presenting complaint, was not in acute distress and did not require a cardiac workup.

The trial, presided over by Judge Thomas Hogan lasted ten days. The plaintiffs asked for $3.9 million in damages. The jury was out for less then two hours.

Robert Leavitt Speaks at Chicago Bar Association Meeting

2005-03-18T07:51:00.000-08:00

March 17, 2005. Robert Leavitt addressed the Chicago Bar Association's Commercial Finance and Transaction Committee at its monthly luncheon meeting today. Mr. Leavitt spoke about the Uniform Commercial Code requirements for perfecting security interests in deposit accounts and the key issues raised in the control agreements necessary to perfect such security interests. The well-attended meeting included both in-house attorneys from a number of local area banks, as well as outside attorneys representing financial institutions and their customers. Attendees received Mr. Leavitt's topic outline along with a copy of the latest draft ABA model control agreement.

To receive a complementary copy of the outline or the model control agreement, or to discuss any issues relating to the subject of Mr. Leavitt's talk, please feel free to contact him directly at:

(312) 628-7199
rleavitt@lowis-gellen.com

Lowis & Gellen Client Acquires Two Railroads in Single Transaction

2005-03-18T07:40:00.000-08:00

Lowis & Gellen represented the buyer in its acquisition of two short line railways, one located in Texas and one in Arizona, from one of the largest short line and regional rail service providers in the US. The two lines, representing over 230 miles of track, sold for a total of $8.05 million in cash and notes.

Simultaneously with the purchase of the railroads, the client refinanced both its existing senior and subordinated debt. The combined value of all these transactions (the refinancing and the acquisition of the railway lines) totaled $9.65 million.

The Lowis & Gellen team consisted of Gerald Haberkorn, Robert Leavitt and Jim Lechowicz, who exclusively handled all legal aspects of the transaction including the structuring, drafting and negotiating of the purchase and finance documentation.

For more information, please contact:

Jerry Haberkorn, (312) 456-2701

geraldh@lowis-gellen.com

Lowis & Gellen Client purchases Chicago Landmark Delicatessen

2005-03-18T07:33:00.000-08:00

Lowis & Gellen represented the buyer in its acquisition of a Chicago landmark delicatessen. The delicatessen, a fixture on Chicago's north side for over 50 years, sold in an all cash deal involving bank and SBA financing.

The transaction consisted of a combination stock and real estate purchase, with the real estate being placed separately into a limited liability company especially created for that purpose.

The Lowis & Gellen team consisted of Gerald Haberkorn, Robert Leavitt and Jim Lechowicz, and exclusively handled all legal aspects of the transaction including the creation of the special purpose real estate LLC, and the structuring, drafting and negotiating of the purchase and finance documentation.

For more information, please contact:

Jerry Haberkorn, (312) 456-2701

geraldh@lowis-gellen.com

The Criminal Prosecution of a Medical Malpractice Case

2005-03-11T09:14:00.000-08:00

Shellie Karno, Law Firm of Lowis & Gellen

Suffering from chronic headaches, a thirty-five year old Michigan woman sought medical treatment at United Memorial Hospital, a 105-bed community hospital in Greenville, Michigan. Dr. Jeffrey Askanazi, Chief of the Anesthesiology Department at the Hospital, treated her for pain management. Utilizing the Racz procedure, Dr. Askanazi injected pain medication directly into the epidural space of the spinal column. The procedure was performed on 21 separate occasions without event. During the 22nd treatment, the patient arrested, could not be resuscitated, and died. An autopsy revealed that the needle had punctured the cervical spine. A malpractice lawsuit was filed against Askanazi and the anesthesiologist, and was settled out of court. This was only the beginning of Dr. Askanazi's legal battles.

Medical License Suspension by State

The Michigan Office of Health Services opened an investigation based on several complaints regarding Dr. Askanazi's clinical treatment. In addition to the death of the Greenville woman, two other patients suffered permanent paralysis post injection by Dr. Askanazi. A hearing was held and expert testimony was presented regarding the Racz procedure. Dr. Askanazi testified that he realized he had inadvertently punctured the cervical spine, but denied that the puncture caused her death. Dr. Askanazi testified that the anesthesiologist providing sedation during the procedure administered too much anesthesia, and failed to properly resuscitate. His testimony was supported by expert opinion. Nonetheless, the Michigan Attorney General's Office suspended Dr. Askanazi's medical license, citing ten cases of improper care.

State Criminal Investigation for Involuntary Manslaughter

Concurrent with the license proceedings, the Attorney General for the State of Michigan conducted a criminal investigation as to whether Dr. Askanazi could be charged with involuntary manslaughter. To maintain a conviction for involuntary manslaughter, Michigan law requires that the state prove gross negligence, rather than mere negligence. The State Attorney General decided not to prosecute Dr. Askanazi for involuntary manslaughter, being unable to produce an expert willing to testify that Dr. Askanazi's treatment was grossly negligent.

Federal Criminal Investigation for Fraud

At the same time, the United States Attorney's Office initiated a criminal investigation leading to the filing of felony charges against Dr. Askanazi for fraudulently billing Medicare, Medicaid, and private insurers. Askanazi was charged with thirty-four counts of fraud for upcoding patient office visits and billing for medically unnecessary procedures with intent to defraud. The issues at trial were strictly related to billing practices, and not to medical negligence or the quality of care. However, the local newspaper repeatedly vilified Dr. Askanazi, and blamed him for multiple patient injuries and deaths. His attorney urged the judge to order a change of venue. Despite concern regarding the salacious nature of the newspaper articles, the judge denied the request.

At trial, the prosecutor portrayed Dr. Askanazi as a greedy and reckless physician who was only concerned about making money. The defense argued that Dr. Askanazi was a pioneer in an emerging specialty and disagreements about the proper course of treatment are a fact of medicine. With regard to billing irregularities, defense counsel argued that the defendant was a research scientist who tried to bill properly in a new field while faced with conflicting advice. The jury deliberated for seven hours and convicted Dr. Askanazi on thirty-three of the thirty-four counts. Dr. Askanazi was ordered to pay restitution of $411, 060, in addition to a $25,000 fine, and 600 hours of community service. Dr. Askanazi was also sentenced to three years in prison. On appeal, the conviction was confirmed, and Dr. Askanazi served his complete sentence.

Federal Prosecution of the Hospital and CEO

Several months after Dr. Askanazi's trial, a federal grand jury indicted United Memorial Hospital for conspiracy to commit fraud by submitting claims for unnecessary facility fees. The government's theory was that the Hospital was on notice that Dr. Askanazi was performing unnecessary procedures, but ignored the problem and instead focused on the favorable financial impact of the lucrative facility fees he generated. A conviction on a single count involving a Medicare or Medicaid claim could have resulted in exclusion of the Hospital from participation in federal health care programs for five years. A trial would involve catastrophic risk for United Memorial Hospital.

In its case, the government intended to offer testimony about the Greenville woman's death as evidence of the Hospital’s criminal intent and knowing submission of the claims. Evidence that United Memorial Hospital continued to submit bills for facility fees even after the patient's death would indicate that the Hospital knowingly and voluntarily agreed to cooperate with Dr. Askanazi to defraud the government. When the Greenville woman died, the United Memorial Hospital took no immediate action with regard to Dr. Ashkenazi's privileges. The Hospital continued to submit bills for payment of facility fees, including eighteen bills for procedures performed after her death. At the height of Dr. Askanazi's pain practice, the Hospital's net income grew from less than a half million dollars to over two million dollars. Dr. Askanazi's pain practice had become responsible for approximately one third of the Hospital's bottom line. Prior to trial, United Memorial Hospital pled guilty, and agreed to pay full restitution, fines, and the costs of the prosecution. An order was subsequently entered permitting the hospital to allocate approximately half of its $1.05 million criminal fine to indigent care.

Meanwhile, the Hospital's CEO's income had spiraled, as his annual bonuses were tied to hospital revenues. The CEO was concurrently exploring an employment opportunity with Dr. Askanazi's new biotech firm. In addition to the charges brought by the government against United Memorial Hospital, the prosecutor charged the Hospital CEO with perjury. This charge stemmed from his grand jury testimony regarding his relationship with Dr. Askanazi, and the Hospital's anesthesia contract with Dr. Askanazi. On the second day of his trial, federal prosecutors dropped the charges against him.

Federal Prosecution of the Medical Staff President and Department Chair

Pursuant to the provisions of its bylaws, the Hospital Board had relied upon the Medical Executive Committee and its peer review subcommittee for oversight of quality of care issues and physician credentialing. The Medical Staff President and Emergency Medicine Chief were both members of the Medical Executive Committee and its peer review subcommittee. Several physicians, nurses, and operating room staff complained repeatedly to medical staff leadership and Hospital administration about Dr. Askanazi's practice patterns, long before the Greenville woman's death. These complaints eventually reached the Board of Directors, and that Board requested that the Medical Executive Committee initiate a peer review of Dr. Askanazi's practice. The peer review subcommittee retained an outside physician to review Dr. Askanazi's cases for indications of medical necessity. The consultant concluded that Dr. Askanazi's patient assessments were inadequate, and Dr. Askanazi's findings in support of diagnoses were consistently absent, with "an apparent routine overuse of invasive techniques without clear indications". The resultant peer review recommendation of counseling and monitoring for improved documentation was never carried out. Dr. Askanazi continued to perform pain management procedures for another 11 months, until he voluntarily resigned from the medical staff one month after the death of the Greenville woman.

The government also prosecuted the Medical Staff President and Emergency Medicine Chief. The prosecution's theory against these physicians was that they conspired to conceal staff complaints and obstruct peer review proceedings in order to allow Dr. Ashkenazi to continue his practice and generate fees. These physicians and the CEO partnered with Askanazi to purchase commercial property and build a surgery center. The physicians also served on the Board of Dr. Askanazi's professional medical corporation. Notwithstanding these mutual financial interests and recommendations from other medical staff members that that they recuse themselves, the Medical Staff President and Emergency Medicine Chief continued to serve on committees responsible for reviewing Dr. Askanazi's practice. Both physicians pled guilty and entered into separate agreements with the government involving restitution, fines, and community service.

Credentials: Sword and Shield

As part of its case against United Memorial Hospital, the government subpoenaed the Credentials and Peer Review files of Dr. Askanazi and two physicians who underwent peer review during the same time period. The Hospital objected to the disclosure of these files, but the Judge overruled the objection, and ordered the Hospital to produce the files. These two physicians were taken to peer review after they voiced concerns regarding Dr. Askanzi's pain practice. The hearings resulted in suspension of each physician. The peer review proceedings of the suspended physicians were compared to the proceedings against Dr. Askanazi, and the processes stood in stark contrast. The United States Attorney concluded that the Hospital used the peer review process as a shield to protect Dr. Askanazi, and a sword to remove the physicians who questioned him. The Hospital admitted that Dr. Askanazi’s application for privileges indicated he had no training or experience in pain management, and as Chairman of the Anesthesia Department at the Hospital, had approved his own clinical privileges. The government concluded that the files demonstrated the Hospital lacked oversight of the peer review and credentialing processes and failed to properly supervise Dr. Askanazi's hospital practice.

Conflicts and Compliance

It is clear that these financial conflicts should have been disclosed, and that the medical staff president and department chair should have recused themselves from any deliberations involving Dr. Askanazi. The potential conflicts you may confront as a member of the board, a medical staff officer, committee member, or department chairman, will probably not be this obvious. The post-Enron scrutiny of corporate boards by the government, media, and the public, extends to non-profit boards, including hospitals. Physicians need to be cognizant of the health care fraud and abuse guidelines that define compliant billing practices and business relationships. On January 31, 2005, the Department of Health and Human Services, Office of Inspector General released its Supplemental Compliance Program Guidance for Hospitals. This document supplements the OIG’s 1998 Compliance Program Guidance that addressed the fundamentals of establishing an effective compliance program. The two documents collectively consider the federal anti-kickback statute, the safe harbor regulations, and other OIG advisory guidance, and offer a set of guidelines for developing, implementing, and evaluating a compliance program. To familiarize yourself with these guidelines, visit the OIG’s website at www.oig.hhs.gov/fraud/docs/complianceguidance.

Lessons Learned

Is this case an aberration, or is it the first of many criminal
prosecutions of hospitals that fail to prevent a physician from delivering substandard care? Either way, government enforcement of fraud and abuse regulations yields a huge payback, and does not appear to be slowing down. The Department of Health and Human Services released its annual report to Congress on the progress of the OIG's initiatives to decrease fraud and abuse and limit the government's health care spending. The highlight of the report included a reported savings of over $23 billion for fiscal year 2003. This is good news for the majority of hospitals and physicians who are both dedicated to providing quality patient care and committed to understanding complying with the government regulations. Here are some lessons to be learned from the experiences of Dr. Askanazi and United Memorial Hospital.

Facilitate open discussions of issues relating to Board members' and medical staff leadership's professional and corporate responsibilities;
Review conflicts policy and situations that require recusal from participation in a committee or vote;
Implement policies that prohibit physicians with mutual financial interests from reviewing each other;
Develop a process for addressing approval of privileges for members of the Credentials Committee or Department Chairmen;
Develop objective criteria for granting privileges for new or novel clinical procedures and ongoing monitoring;
Know the institution's policy for review and investigation of clinical staff complaints;
Utilize quality indicators for reviewing medical necessity;
Apply medical staff policies consistently to all medical staff members;
Review billing and coding practices and investigate for possible patterns of unnecessary services;
Revisit the institution’s Compliance Program.

ARBITRATION AWARD EXONERATES CENTRAL ILLINOIS

2005-02-02T07:24:00.000-08:00

A lengthy arbitration with millions of dollars at stake has been resolved, with a decision that fully exonerates a prominent group of allergy and respiratory physicians charged with breach of contract and fraud in a participating provider agreement with a major Midwest health insurer. The award included recovery of wrongfully withheld "withholds" and attorneys' fees the physicians incurred in the four-year battle.

After four consecutive renewals of what was originally a one-year agreement, Health Alliance Medical Plans, Inc. filed a complaint that charged a group of prominent central Illinois physicians retained as contract service providers for the company's HMO members with having provided services that were "inappropriate and not medically necessary" and sought to recover an estimated $1.3 million. The physicians, Central Illinois Allergy and Respiratory Services, retained Lowis & Gellen attorneys Jerry P. Clousson and Mark J. Smith who successfully disproved those claims and presented a persuasive counterclaim documenting that Health Alliance Medical Plans had not honored its obligation to return withheld fees to the physicians.

A panel of arbitrators considered the evidence and arguments and found in favor of the physicians on all issues of all counts, with the exception of one minor counterclaim.

The arbitration was brought before the American Health Lawyers Association Alternative Dispute Resolution Service in accordance with Health Alliance's Participating Provider Agreement.

The physicians' counsel, Lowis & Gellen, provides corporate counsel and dispute resolution representation to the health care industry, including hospitals, provider groups and physicians, in arbitration, mediation, trial and appellate courts in several states. More information on the attorneys and practice of Lowis & Gellen can be found at www.lowis-gellen.com

FOR ADDITIONAL INFORMATION CONTACT:
JERRY P. CLOUSSON, Of Counsel
Lowis & Gellen
312-456-2714 312-364-8778
jclousson@lowis-gellen.com
MARK J. SMITH, Partner
Lowis & Gellen
msmith@lowis-gellen.com

Enforcement of Restrictive Covenant

2005-01-11T08:06:00.000-08:00

Gerald Haberkorn and Kevin J. Clancy successfully represented the owner of a fast-food restaurant franchise in an action seeking to enforce a restrictive covenant and enjoin the opening of another franchise within a restricted area. The client had purchased its franchise as well as a license to use certain trademarks from the defendants two years ago. The purchase agreement and the license agreement prohibited the defendants from opening another franchise within a 1.9 mile radius of the client's store, or from licensing the same trademarks to any business within that area. Upon learning that the defendants intended to open a competing restaurant within only 1.2 miles, Lowis & Gellen filed a motion for a temporary restraining order and preliminary injunction to prevent the opening. Mr. Haberkorn and Mr. Clancy not only obtained the requested injunction in favor of their client, but also secured an order requiring the defendants to pay 100% of their client's attorneys fees incurred in obtaining that injunction

Las Vegas Multi-Specialty Physician Orgaization

2005-01-11T07:59:00.000-08:00

Jerry Clousson and his team have just organized a multi-specialty physician orgaization in Las Vegas which is unique in offering a panel of board certified or board eligible physicians only to payors. The physician members also will be offering disease management programs designed to reduce cost of medical care.

Also, Mr. Clousson's team closed on the sale of Woodland SurgiCenter and accompanying real estate to St. Anthony Hospital in Michigan City for $4,000,000.

Appellate Victory

2005-01-04T13:33:00.000-08:00

Lowis & Gellen's Appellate Practice Group won for a third time in December, this time for a physician involved in a contract dispute. The physician had entered into a professional services agreement with a corporation (which was not a licensed hospital), to provide medical services in an area surrounding the corporation. After approximately one year, the physician ended the relationship, and the corporation sued to recover over $100,000.00 it had paid the physician. The trial court dismissed the claim on the basis that the professional services agreement between the physician and corporation was really an employment agreement that violated the corporate practice of medicine doctrine and was therefore illegal. The corporate practice of medicine doctrine prohibits employment agreements between physicians and corporations that are not licensed hospitals. The corporation appealed, claiming the professional services agreement was not an employment agreement, but rather a loan agreement, and therefore not subject to the corporate practice of medicine doctrine. The Second District Appellate Court rejected the corporation’s argument and affirmed the trial court's decision. Like Lowis & Gellen’s other appellate victories this month, the court did not take oral argument on the matter, which meant the case was won on the strength of the brief. The trial attorney was Jerry P. Clousson and the appellate attorney was Patrick R. Moran.

2004-12-16T08:22:00.000-08:00

Lowis & Gellen's Appellate Practice Group won two more victories this week for our clients. In a medical malpractice case alleging a failure to diagnose a brain tumor in a child that went to a jury trial in early 2002, verdicts were returned in favor of both Lowis & Gellen's clients, a pediatric neuroradiologist and a large Chicago area teaching hospital. The plaintiffs appealed, asserting that they were entitled to a new trial based on evidentiary errors committed by the trial court. The First District Appellate Court rejected the plaintiffs' arguments and affirmed the lower court decision. The court did not take oral argument on this matter, which meant the case was won on the strength of the trial record and the brief. The trial attorneys were Jennifer Lowis and Jenny Ostrom Blake and the appellate attorneys were Deborah O'Brien and Joan M. Kubalanza.

In the second case, an employee recovered a settlement amount in the Illiniois Industrial Commission and sought review of the Industrial Commission's order. Lowis & Gellen, on behalf of its client, a community hospital, moved to dismiss the complaint in the trial court arguing that the plaintiff had not timely filed his action for judicial review. The trial court agreed that the employee had waited too long to seek judicial review and dismissed the action. The plaintiff appealled. The Appellate Court affirmed the lower court's decision. Mike Code and Denise Siegel handled the matter in the trial court and Denise Siegel and Joan M. Kubalanza were the appellate attorneys. Again, the case was won on the record below and on the strength of the brief as the Appellate Court did not hear oral argument.

2004-12-10T14:37:00.000-08:00

Mergers and Acquisitions

Represented a UK company in structuring, negotiating and consummating an agreement to enable its US subsidiary to acquire a subsidiary of a regional bank that provides specialized global financial services. Our representation including assisting the client in conducting and completing due diligence and negotiation and preparation of all required acquisition documentation.

Represented an Illinois company in acquiring the assets of a Minnesota competitor and establish a Minnesota division in a short time frame. Represented the Illinois company in negotiating the terms of a proposed sale of the company to a larger organization while closing the acquisition of the Minnesota transaction.

Bank Financings

Represented a US food processing company in negotiating and closing a multimillion-dollar term loan facility. The loan is being used to finance the acquisition of fixtures and equipment to complete the build out of a state of the art food warehouse complex. Negotiations included balancing the interests of the client and a special purpose entity leasing the facility with the interests of the senior term lender, a subordinated secured debt holders and the landlord.

Cross Border Activities

Represented a Canadian company and its US subsidiaries in connection with the closing of a multi-million dollar credit agreement by serving as the US counsel. Our representation included providing advice to the Canadian company on structuring its subsidiary’s capitalization and debt terms under the facility. Our representation also included providing the US law opinion to facilitate the closing and funding of the transaction.

2004-12-02T13:27:00.000-08:00

Correction: We apologize for the error in the following announcement, posted earlier this month, which read in part:

The attorneys of Lowis & Gellen announce with pride that our partner Gerald Haberkorn has been selected as one of the best commercial litigators by Leading Lawyers, based on a peer survey of Illinois attorneys. This honor is significant because fewer than 150 commercial litigators were selected from the more than 20,000 lawyers recommended.

In truth, Jerry was selected as one of Illinois' Leading Lawyers in two categories. Peers and colleagues also chose to recognize Jerry's work in Professional Malpractice Defense Litigation. He represents and counsels professional service partners and limited liability companies and partnerships in negotiations, contested and adversarial dissolutions, dispute resolution and professional malpractice litigation throughout the country. Clients include lawyers, physicians, engineers and architects.

And, this just in, Jerry is a finalist in Fast Company magazine's 2005 "Fast 50" competition, recognizing thought leaders and entrepreneurs (or just those doing traditional work - like the practice of law - in a way that departs from the traditional delivery of services) in 20-plus industries.

Additionally with Jerry, Bob Smith was also selected as one of the best in Professional Malpractice Defense Litigation. It is an incredible accomplishment for two of our attorneys to be selected into this elite group.

Too, Joan M. Kubalanza, one of our partners, just completed teaching first year law students at The John Marshall Law School the art of persuasive brief writing and appellate advocacy. The students were required to write one trial court brief and two appellate court briefs. They also were required to present oral arguments to a panel of three "judges" with regard to the appellate briefs. Kevin J. Clancy one of Lowis & Gellen's litigators and a former Seventh Circuit Court of Appeals Law Clerk served as a "judge" for the arguments and provided the students with insights into their oral advocacy skills.

Besides being busy with work and teaching, Joan also recently participated in a program sponsored by the Big Shoulders Fund. Joan had breakfast with Cardinal George and then went to Queen of Angels Catholic Elementary School to visit with students and staff. Joan spent the most of her visit working with the First Grade Class and thoroughly enjoyed the experience.

CHRPP Audio-Conference

2004-12-02T11:58:00.000-08:00

December 2, 2004
Robert Smith did an audio-conference today for 16 CHRPP hospitals. Mr. Smith spoke on "chain of command" issues affecting a hospital's liability. There were 160 participants.

Chicago Bar Association Christmas Spirits Play

2004-12-02T11:35:00.000-08:00

Our lovely, beautiful and talented associate, Jamie A. Leavitt will be performing in the Chicago Bar Association, Christmas Spirits play which will run each night from December 7, 2004 through December 11, 2004 at the Merle Reskin Theater located at 60 E. Balbo, Chicago.

"The Wolf at the Door"

2004-12-02T09:01:00.000-08:00

On November 19, 2004 Vito Masciopinto spoke to the Advocate Risk Management team in Oakbrook Illinois on current medical legal issues. The presentation entitled "The Wolf at the Door" focused on the challenges facing risk managers in the current litigation enviorment. Specifically, the talk addressed topics including the Medical Studies Act, apparrent agency, the Good Samaritan Act as well as an essay on current verdicts and settlements.

Rob Smeltzer Speaks at CBA meeting 12/2/04

2004-12-01T13:17:00.000-08:00

THE CHICAGO BAR ASSOCIATION
Committee Meeting Announcement

Thursday, December 2, 2004

Putting Overtime to the Test - the D.O.L. and Illinois Fight to Define Pay New regulations set forth by the Department of Labor have narrowed the exemptions to the Fair Labor Standard Act's overtime provisions. These new policies require almost every employer to review its payroll policies and practices to ensure compliance. Illinois has enacted legislation that promises to confuse rather than clarify federal Fair Labor Standards overtime rules for employers. In this informative meeting, the speaker will traverse the impact of these new amendments to Illinois employers including those with locations in multiple states. Also covered will be the considerable consequences of failing to pay employees overtime in accordance with state and federal law.

Rob Smeltzer, Esq.
Presenter Rob Smeltzer is a partner at Lowis and Gellan. He has federal and state court expertise in all phases of labor and employment litigation, counseling, non-patent intellectual property, commercial litigation, and municipal tort liability. He has handled over 100 Title VII, ADEA, ADA, FLSA, ERISA and FMLA matters before the EEOC, the Illinois Department of Human Rights, the Illinois Human Rights Commission, the Chicago Commission on Human Relations, the U.S. Department of Labor and state and federal courts. He is an Adjunct Professor at Loyola University School of Law. He has contributed to several major treatises including Holloway & Leech, Employment Termination -- Rights and Remedies (BNA 1993) and Tobias, Litigating Wrongful Discharge Claims, (Callahan, 1989).

Meeting Details
The meeting will start promptly at 12:15 p.m. and conclude promptly at 1:15 p.m. Please check the meeting room board on the first floor of the Chicago Bar Association for our room assignment.

Election of Judge to Illinois Supreme Court Bodes Well for Judicial Reform

2004-11-22T15:06:00.000-08:00

This past election day, voters in the southern portion of Illinois (the Fifth Appellate District) cast ballots for a new Illinois Supreme Court justice to represent that District. The bitterly contested election between Lloyd Karmeier (R), a circuit court judge from Washington County, and Gordon Maag, an appellate court justice from well-known Madison County was the single most expensive judicial election in the history of the United States. Maag is a well-known promoter of plaintiffs' rights, frequently issuing opinions that benefit plaintiffs’ class action attorneys, which have led to Madison County gaining national prominence as the class action capital of the country. Karmeier, on the other hand, is a conservative judge who strongly favors restrictions on the ability to bring far reaching national class actions. The Plaintiffs' bar donated millions to Maag and justice reform groups donated millions to Karmeier. In he end, Karmeier defeated Maag and will soon join the Court representing the Fifth District.

Notably, Maag was the author of the opinion upholding the $1.2B nationwide class action judgment in Avery v. State Farm, which is now on appeal to the Illinois Supreme Court. The oral argument was in May of 2003 but there is no decision yet. One of the crucial issues in that case was whether Illinois courts can apply the Illinois Consumer Fraud Act universally to parties from other states in nationwide class actions, so called extra-territorial application. This issue was previously before the Court in Oliveira v. Amoco Oil Co., 776 N.E.2d 151 (Ill. 2002), but the Court avoided the issue by deciding that case on other grounds. Because consumer fraud laws vary quite materially from state to state, unless Illinois courts can apply the Illinois act uniformly to parties from all 50 states, it becomes very difficult to certify a nationwide class for consumer fraud claims. One of our attorneys, Kevin Clancy, drafted an amicus curiae brief to the Court arguing against the nationwide application of the Act on behalf of a major insurance carrier. Though it remains to be seen how the Court will rule in the Avery decision, the addition of Justice Karmeier to the Court bodes well for some expectation of reform and limits on widespread litigation not just in Southern Illinois but also throughout the State.

If you have any questions or concerns about claims under the Illinois Consumer Fraud Act, or how those claims may affect your business, please feel free to contact either Gerald Haberkorn (312) 456-2701, Kevin J. Clancy (312) 628-7855, or Joan M. Kubalanza (312) 628-7194. We would be happy to discuss those matters with you.

PHYSICIAN SELF REFERRAL REGULATIONS

2004-11-22T08:46:00.000-08:00

PHYSICIAN SELF REFERRAL REGULATIONS: STARK II, PHASE II
IS THAT ALL THERE IS?

Shellie Karno,
Law Firm of Lowis & Gellen

SUMMARY

On July 26, 2004, Phase II of the interim final regulations of Stark II became effective.1 The regulations are the second of two phases of the final Stark regulations.2 The Center for Medicare and Medicaid Services (“CMS”) has clarified that the original regulations issued in 1995 are now superceded by these interim final rules.3 The Phase II regulations continue the trend of liberalizing interpretations and adding exceptions. This article provides a short overview of the federal physician self-referral statute and explores the recent significant changes.

CONCLUSION

The intent of the Phase II regulations is “to reduce the burden and prescriptive nature of the Stark law”. However, the physician self-referral regulations have been 15 years in the making and embody hundreds of pages of statute. Don’t try to sort this out yourself at home. The sanctions associated with a violation can be devastating to a provider. The public and private enforcement initiatives will continue their upward spiral. For questions about the Stark II Phase II regulations, or about self-referral issues in general, please contact Shellie Karno or Jerry Clousson at the law offices of Lowis & Gellen.

BACKGROUND

The physician self-referral rules prohibit a physician from referring patients to an entity for the furnishing of designated health services covered by Medicare, when the physician, or an immediate family member, has a financial relationship with the entity. 4 The regulations defined “designated health services” to include:

Clinical laboratory services
Physical therapy services
Occupational therapy services
Radiology services
Durable medical equipment
Prosthetics
Outpatient prescription medication
Home health services
Outpatient hospital services.

This means that a physician cannot refer a patient covered by Medicare for any of the above services to an entity wherein the physician has a financial interest. The law has carved out many exceptions to the self-referral prohibition. However, even when the transaction does fall within an exception, it is imperative that the amount of payment reflects fair market value and is not based on the volume or value of the referrals.

EXCEPTIONS TO THE SELF-REFERRAL PROHIBITION

While the statute sets out a general prohibition against self-referral, the heart of the statute is the list of arrangements and relationships where the prohibition does not apply. Exceptions are generally categorized into three types: the ownership interest exception, the compensation arrangement exception, and the all purpose exception.

The ownership interest exception allows for physician ownership of investment securities that can be purchased on terms generally available to the public.6 For example, a physician does not violate the self-referral prohibition by ordering medications manufactured by a publicly owned pharmaceutical company that he or she owns stock in. The ownership interest exception also applies to providers in rural areas, and to hospitals located in Puerto Rico.7 The ownership interest exception extends to ownership interests in hospitals when the physician is on staff at the hospital and is authorized to perform services.8

Compensation arrangement exceptions include the rental of office space and equipment, provided that the physician does not share the space or equipment with the landlord.9 Bona fide employment agreements are excepted,10 as are personal services arrangements such as a medical director.11 Physician incentive and physician recruitment plans that meet certain criteria are excepted from the self–referral prohibition.12 The exception that allowed for a one time or isolated transaction has been expanded under the new regulations to permit multiple payments that are integrally related.13 Payments made by a physician to a laboratory for the provision of clinical lab services, or to an entity for other items or services, are allowed provided the items and services are furnished at fair market value. 14

The regulations carve out an exception for certain group practice arrangements between a hospital and a group practice if the arrangement is commercially reasonable, and otherwise qualifies for the exception.15 The group practice exception allows for referrals to physician services provided by another physician in the same group practice. In-office ancillary services, excluding durable medical equipment, that are furnished by the referring physician, or by a member of the group, or by individuals who are supervised by the referring physician or group member, fall within the in-office ancillary services exception. 16 Designated health services may be furnished in one of two places - a centralized building used by the group practice to provide designated health services, or in the same building that the referring physician or the group practice provided services unrelated to designated health services.

PHASE II EXCEPTIONS

The regulations create several new exceptions covering charitable donations by physicians,17 hospital referral services,18 obstetric malpractice insurance,19 professional courtesy discounts,20 payments made to retain physicians in underserved areas,21 and intra-family referrals in rural areas.22 The new regulations also provide a 90 day grace period for arrangements that have fallen out of compliance with an exception.23 The physician recruitment exception now allows for remuneration from a hospital in return for relocating to the geographic area served by a federally qualified health center.24 The employment relationship exception now permits the physician to be paid a productivity bonus based on personally furnished designated health services.25 Compensation arrangements based upon a percentage of the professional services provided can qualify for an exception, as long as the percentage itself is set in advance. The office and equipment exception has been liberalized to apply to any lease arrangement, including capital leases.26 This exception also allows for many sublease arrangements, provided that the tenant does not share the space or equipment with the lessor.

The earlier academic medical center exception was fraught with various conditions for the medical center and the physician. In Phase II, the CMS accommodated the many requests for a relaxation of several key definitions including expansion of the definition of a qualifying academic medical center.27

REPORTING AND SANCTIONS

The regulations require that each entity furnishing Medicare covered items or services provide the Department of Health and Human Services (“HHS”) with information regarding the entity’s ownership, investment and compensation arrangements.28 However, CMS is still developing a procedure for implementing the reporting requirements and does not currently require any reporting until such procedures are put in place.29 In the reporting requirements described in the Phase II regulations, an entity “may be required” to submit information upon request of the HHS or CMS. 30 Entities are given 30 days from the date of the request to provide the information.

Stark provides for two types of sanctions: 1) non-payment of improper claims for designated health services and recoupment of amounts already paid, and 2) civil monetary penalties of $15,000 for knowing violations. 31 In addition, violations of the self-referral prohibition may also be prosecuted by the Department of Justice under the False Claims Act.32 Violations under the False Claims Act can be pursued by whistleblower actions, and the monetary incentives of such lawsuits may obviate the need for government enforcement.

1. 69 Fed. Reg. 16053
2. 42 U.S.C. 1395 nn
3. www.cms.hhs.gov/media/press/release.asp. Accessed 3/29/04
4. Id at (a) (1)
5. Id at (a) (6) (A-K)
6. Id at (6) (1) (a) and (b)
7. Id at (d) (1) and (2)
8. Id at (d) (3)
9. Id at (e) (1) (A) and (B)
10. Id at (e) (2)
11. Id at (e) (3) (A)
12. Id at (e) (3) (B)
13. 69 Fed. Reg. 16098
14. 42 U.S.C. 1395 nn (e) (8)
15. Id at (e) (7)
16. Id at (b) (2)
17. 42 C.F.R. 411.357 (j)
18. Id at 411.357 (q)
19. Id at 411.357 (r)
20. Id at 411.357 (s)
21. Id at 411.357 (t)
22. Id at 411.355 (j)
23. 69 Fed. Reg. 16057
24. Id at 16139
25. Id at 16138
26. Id at 16086
27. Id at 16137
28. 42 U.S.C. 1395 nn (f)
29. 63 Fed. Reg. at 1703
30. 69 Fed. Reg. at 16142
31. Id at 16056
32. Id at 16126

LOWIS & GELLEN WINS TWO MAJOR LABOR ARBITRATIONS

2004-11-22T08:43:00.000-08:00

June 30, 2004

Lowis & Gellen's team of Robert Smeltzer and Patrick Moran recently delivered major victories for two clients in consecutive labor arbitrations.

In the first case, decided June 16, 2004, Mr. Smeltzer and Mr. Moran successfully defended their manufacturing client's right to train and assign employees to specific work, regardless of seniority. The Paper Allied Industrial Chemical and Energy Workers Union initiated the dispute against the company, a metal stamping manufacturer, alleging the company had violated the collective bargaining agreement by laying-off a tool and die maker with 36 years of seniority. The company had retained two other tool and die makers with much less seniority, because they were the only employees in the tool and die maker classification qualified to operate and maintain four specific machines on which the laid-off employee had not been trained. The company argued that the collective bargaining agreement recognized an exception to lay-offs by seniority to ensure that employees remaining in the affected classification possessed the qualifications to perform all of the work involved in that classification. The union argued that the employer's decisions about whom to train was a pretext to avoid the seniority provisions.

Mr. Smeltzer and Mr. Moran persuaded the arbitrator to uphold the company's right to exercise its discretion under the collective bargaining agreement to manage its workforce. The arbitrator also found that whether other workers who were not tool and die makers could operate the machines was irrelevant, because the collective bargaining agreement specifically permitted the employer to lay-off by classification.

On June 30, 2004, Mr. Smeltzer and Mr. Moran prevailed again in a labor arbitration involving a wage dispute. In this case, the union, Laborers' Local 309, claimed that the company, a supplier of traffic control devices for construction projects, violated the collective bargaining agreement by not paying its employees prevailing wages for "public works projects," covered by the Illinois Prevailing Wage Act. The Illinois Prevailing Wage Act requires construction employers to pay their employees prevailing wages, which are usually several dollars per hour more than normal, for work on "public works." The union claimed that state law required the company to pay prevailing rates for every single project on which the company supplied equipment. The company argued that the union failed to meet its burden of proving that all of the company's work invovled "public works" per the statutory definition. In finding for the company, the arbitrator noted that there was simply no evidence that the company had violated either the Illinois Prevailing Wage Act or the collective bargaining agreement.

Robert Smeltzer is a 13-year veteran of labor and employment arbitrations and federal and state court trials. Patrick Moran is a trial and arbitration attorney with significant experience in labor and employment claims.

For more information, please contact:
Robert Smeltzer(312) 456-7952
rsmeltzer@lowis-gellen.com

Lowis & Gellen Client acquires Aluminum Clad Steel Wire Manufacturing Business.

2004-11-22T08:41:00.000-08:00

March 1, 2004

Lowis & Gellen represented the buyer, ("Buyer") in its purchase of the assets of a California based aluminum-clad steel wire manufacturing company (the "Business"), a subsidiary of a large multinational company. The all cash acquisition successfully closed today.

Founded in 1912, and operating out of its plant in Illinois, Buyer is a leading manufacturer and marketer of bare and insulated copper and aluminum wire, ACSR, aluminum-clad steel, copper-clad steel, building wire, underground power cables, welding cables, ground rods, and medium voltage cables for the utility, telecommunication, electrical distribution, and OEM markets nationwide. The addition of the Business, which will operate as a division of Buyer, represents a strategic expansion of Buyer' product offering and customer base.

The Lowis & Gellen team consisted of Jerry Haberkorn, Bob Leavitt and Julie Herlien, and exclusively handled all legal aspects of the transaction for Buyer including negotiating and drafting the purchase and financing documentation.

For more information, please contact:
Jerry Haberkorn(312) 456-2701
geraldh@lowis-gellen.com

Lowis & Gellen Client sells its All Natural Food Businesses to National Food Conglomerate.

2004-11-22T08:38:00.000-08:00

August 15, 2003, Chicago - Lowis & Gellen represented the sellers (the "Sellers") in the sale of their all natural food businesses (the "Business") to a national food conglomerate (the "Buyer"). The transaction entailed a combination of cash, preferred equity and junior subordinated debt, and successfully closed today.

Headquartered in Chicago, Illinois, the Business offers a broad line of distinctive natural fresh and cooked sausages and other value added food products to customers nationwide under a nationally recognized brand name. The Buyer, a leading natural and organic meats company, owns interests in companies throughout the country producing organic and natural chicken and beef products. The addition of the Business greatly expands the depth and breadth of the Buyer's already extensive offerings of sausage products.

The Lowis & Gellen team consisted of Jerry Haberkorn, Bob Leavitt and Jim Lechowicz, and exclusively handled all legal aspects of the transaction for the Sellers including negotiating and drafting the purchase, debt and equity structures and documentation.

For more information, please contact:
Jerry Haberkorn(312) 456-2701
geraldh@lowis-gellen.com