![]() ![]() The SRA contained provisions in which plaintiff agreed that it had received the information it deemed necessary to decide whether to sell the stock defendants had not made any representations outside the SRA the SRA contained the complete agreement between the parties and plaintiff was to release and discharge defendants from known and unknown claims. This offer was made at $1.20 per share.Īfter two months of negotiations, plaintiff entered into a stock repurchase agreement (SRA). The opinion relates that Rajaram told plaintiff that Mu Sigma would no longer experience explosive growth, would have to rely on acquisitions to replace organic growth, that a large customer would be lost and that it was “time for plaintiff to sell,” warning that there was “no upside left” for the company. A second approach was made about six months later. The first such attempt was to repurchase at 67 cents per share, which implied a valuation for the corporation 61 percent less than a then-recent stock transaction. Plaintiff alleges that after Mu Sigma and its founder, CEO and chair of its board of directors, Dhiraj Rajaram, reaped the benefits of plaintiff’s “reputational capital,” including acquiring prominent tech companies as customers, he made two approaches to plaintiff, seeking to repurchase plaintiff’s shares. This plaintiff investment company, acting on behalf of a prominent Chicago family, purchased $1.5 million of preferred stock in the defendant privately held data analytics company, Mu Sigma, Inc. (The Public Law Library free account required.Our panel of leading appellate attorneys reviews the Illinois Supreme Court opinions handed down Monday, November 28. I believe the trial court abused its discretion when it denied the defendants’ motion to compel arbitration.” The dissent also was concerned that “the plaintiffs are trying to slip out of their contractual duty to arbitrate. The dissent saw the more important policy as encouraging arbitration. All of that would defeat an important purpose of arbitration – saving the costs of litigation. This opinion stated that overlooking waiver might result in heavier costs for the parties to resolve the dispute parties would be motivated to take discovery in the lawsuit, to which they might not be entitled in the arbitration, then demand arbitration. ![]() The primary opinion discussed some of the policy considerations involved in waiver of a claim to arbitrate: “Illinois courts disfavor a finding of waiver … However, the right to compel arbitration of a dispute can be waived as with any other contractual right … Illinois courts will find waiver of a party’s right to compel arbitration when a party’s conduct is inconsistent with an arbitration clause, thus indicating an abandonment of the right to arbitration … Additionally, a party waives its right to arbitrate by submitting arbitrable issues to a court for decision … Illinois courts also consider the delay in a party’s assertion of its right to arbitrate and any prejudice the delay caused the plaintiff …” Two of the opinions agreed with the trial court so the waiver ruling was affirmed. The appeal evoked three separate opinions from the three-judge panel. The First District Illinois Appellate Court ruled that “a motion to compel arbitration is analogous to a motion for injunctive relief,” and that the standard of review is “abuse of discretion.” The appeal was pursuant to Illinois Supreme Court Rule 307(a), which permits interlocutory appeals as of right from an order granting, modifying, refusing, dissolving, or refusing to dissolve or modify an injunction. The law firm appealed the denial of its attempt to compel the arbitration. The trial court ruled that the law firm waived its right to compel arbitration because it participated so heavily in Woods’s lawsuit. In the malpractice case, the law firm raised an affirmative defense that its agreement with Woods required arbitration of “ny controversy, dispute or claim arising out of or relating to our fees, charges, performance of legal services …” But the firm also made two motions to dismiss the case, filed a demand for a bill of particulars, served interrogatories on plaintiff, and issued a subpoena for documents to a third-party.Īfter all that, the firm asked the court to compel arbitration of the dispute. The law firm sued for the fees, but voluntarily dismissed its case. ![]() owed $47,000 for legal fees Woods claimed the law firm committed legal malpractice. Jeffrey Woods and three associated parties had a dispute with the Patterson Law firm. ![]()
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