The former head of human resources at Chicago's St. Anthony Hospital is asking a federal appeals court to allow her to revive her lawsuit accusing the hospital of firing her in retaliation for opposing a "pay-to-play" scheme that involved state contracts and criminally indicted former Illinois House Speaker Michael Madigan.
Stella Wolf filed her lawsuit in June 2021, alleging illegal retaliation, violations of the Whistleblower Act and gender and age discrimination and other claims. Wolf, who was then 66 years old and an Oakbrook Terrace resident, said she served as chief human resources officer at the West Side hospital from 2016 to June 2020.
Wolf alleged her relationship with St. Anthony President and Chief Executive Officer Guy Medaglia soured in 2019 when she began receiving complaints about “hostile behavior” by Medaglia “towards his female subordinates.” Wolf alleged she confronted Medaglia, reaching no resolution, after which Medaglia allegedly “undermined, marginalized and belittled Wolf.”
Gail Schnitzer Eisenberg
| Loftus Eisenberg
According to the complaint, the relationship took another turn when Wolf objected to Medaglia’s alleged decision to create new hospital jobs for three people related to former Illinois State Sen. Martin Sandoval.
Sandoval, a Chicago Democrat, later resigned from office and pleaded guilty to charges he took bribes from a red light camera company to promote legislation on its behalf. Sandoval had not yet been sentenced when he died at the age of 56 from Covid.
Wolf accused Medaglia of going over her head to create positions for Sandoval’s son, daughter and his daughter’s boyfriend; in exchange, Sandoval allegedly secured a $5.5 million state grant for the hospital.
Wolf also said Medaglia later ordered her to help Andrew Madigan, the son of then-House Speaker Michael Madigan, undercut competitors to secure the contract to serve as St. Anthony’s insurance broker. However, she said she secured three competitive bids and ultimately retained the prior broker.
Among other allegations, Wolf said St. Anthony terminated her on June 18, 2020, the day before she was return to work from protected medical leave. According to the complaint, the hospital claimed her position was eliminated under a workforce reduction program, but she alleged her replacement was a “substantially younger woman who had not pushed back against Medaglia’s instructions and behavior.”
In an opinion filed Nov. 14, U.S. District Judge Manish Shah granted the hospital’s motion to end Wolf’s lawsuit. He said Wolf’s complaint has no evidence Medaglia asked her to break a law, no evidence she refused such a request and couldn’t show retaliation due to protected activity.
“Wolf characterizes Medaglia’s request as an instruction to bribe Speaker Madigan with a no-bid contract to his son in exchange for state funding,” Shah wrote. “But there is no evidence to support an inference of either side of that quid pro quo.”
Shah noted Wolf’s complaint alleged Medaglia acknowledged a “pay to play” culture, but said she had no evidence Madigan would support state funding for St. Anthony based on hiring his son’s insurance firm. He further noted Madaglia only asked the firm, Mesirow Group, be given a chance to compete for the hospital’s business, which appeared to be in line with standard procedure for contract bidding, and saw no evidence of Wolf refusing to participate in illegal conduct.
“Even assuming Medaglia invited Wolf to participate in illegal activity and Wolf’s choice to complete an RFP constituted a refusal, Wolf does not present facts that would allow a jury to find a causal link between her alleged refusal and the hospital’s alleged retaliatory actions,” Shah wrote.
As part of her retaliation arguments, Wolf claimed she was targeted in what she called a sham investigation by an outside firm into whether she was abusive toward a formal employee. Shah said a reasonable jury wouldn’t find a link between that investigation and her choice to take the insurance contract into a competitive bid process, and also noted that “even when the investigation found serious problems with Wolf’s leadership style, the hospital did not discipline Wolf.”
Wolf also said she didn’t get a merit pay raise at a time the rest of executive team received increases, but she didn’t have evidence those colleagues did see salary bumps and “admits that she voluntarily requested that Medaglia redirect any raise she may receive elsewhere in the hospital given its dire financial status and the fact that several of her peers’ salaries were under market standards.”
Shah said Wolf likewise failed to offer compelling evidence her termination — nine months after her alleged whistleblowing — fell outside the hospital choosing to eliminate several other positions at a time when Covid affected operations. He said her retaliatory discharge claims failed on similar grounds. Although that pleading standard is reduced, Shah said Wolf’s claims of her good faith belief that hospital leadership was engaged in “shady dealings is not the same as a good faith belief in illegality.”
Regarding a claim the hospital violated the Family Medical Leave Act by terminating her on the last day of a 12-week leave, Shah said Wolf had no evidence she was cleared to return to work at that time, which means she was not entitled to be reinstated to her position. He also rejected her FMLA retaliation claim, saying it relied on circumstantial evidence.
Attorney Gail Schnitzer Eisenberg, of the Chicago firm Loftus Eisenberg, represented Wolf in the matter.
She did not respond to a request for comment.
However, on Nov. 27, Eisenberg filed a notice of appeal on Wolf's behalf, asking the U.S. Seventh Circuit Court of Appeals to reverse Shah's ruling.
St. Anthony Hospital has been represented by attorneys Heather A Bailey and Allison Sues, of the firm of Amundsen Davis, of Chicago.