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Appeals panel: Ex-judge, state senator doesn't get fee for economic incentive law to boost Joliet intermodal project

State Court

By Dan Churney | Feb 28, 2020

Centerpoint joliet
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An Illinois appeals court has ruled a real estate company did not shortchange former Democratic state senator and judge Thomas A. Dunn, whom the company hired to grease the skids for a Joliet distribution center, saying Dunn failed to show he qualified for a special fee beyond the pay spelled out in his consulting contract.

The Feb. 25 ruling was authored by Justice Robert Carter, with concurrence from Justices Daniel Schmidt and Tom Lytton, of Illinois Third District Appellate Court in Ottawa. The ruling was issued under Supreme Court Rule 23, which means it may not be cited as precedent except under the circumstances allowed by the rule.

The decision favored Centerpoint Properties and former Chief Executive Officer Michael M. Mullen, in a suit filed in 2014 in Will County by Dunn. Centerpoint is a logistics real estate company in suburban Oak Brook.

Dunn was a state senator for the Joliet area from 1986 to 1997, when he stepped down to become a Will County judge. He retired in 2005, then was appointed in 2015 to the Illinois Gaming Board; he is no longer on the board.

Dunn was a political consultant with Centerpoint from 2008 to 2009, hired to smooth the way for a rail and trucking intermodal facility in Joliet. He was paid $10,000 per month, with a “success fee” to be added if he secured tax increment financing from the city for Centerpoint, according to court papers. As it turned out, such financing was not available. 

However, Dunn claimed Centerpoint still owed him the success fee for suggesting Centerpoint should push for legislation in Springfield, which would create a fund to offset Centerpoint’s $150 million infrastructure costs in setting up the center. The fund’s money would come from state income taxes generated from jobs created by the new facility. The Illinois General Assembly approved the idea, called the "three percent proposal," passing the Intermodal Facilities Promotion Act in 2009.

Centerpoint was reimbursed $1.8 million through the legislation, which also allowed Centerpoint to receive annual grants of as much as $3 million for seven years to cover the project's cost, according to court papers.

Centerpoint refused to pay Dunn a fee following the enactment of the legislation, prompting Dunn to sue in Will County Circuit Court. Dunn lost and appealed.

Justice Carter found Dunn did not deserve the fee.

“There is very little evidence to suggest that plaintiff did very much work on the proposal, other than possibly coming up with the initial idea,” Carter said.

Carter further said what work Dunn did perform on the proposal, was part of the general work he was contracted to do and for which he was paid, not special work for which Centerpoint was obliged to pay the success fee. 

Carter pointed out Dunn’s own tongue worked against him.

“Plaintiff’s testimony could not be any clearer — defendants never promised or told plaintiff that they would pay him a success fee for his work on the three percent proposal,” Carter noted.

In addition, Dunn didn’t lay out in his lawsuit what should have been the fee's amount, Carter said.

According to court documents, Centerpoint hired Dunn largely based on the recommendation of Kelly Tyrrell, a lobbyist for Centerpoint. Tyrrell said he had known Dunn for 40 years and Dunn was well-regarded in the legal community. More importantly, Tyrrell said Dunn told him he believed he could secure TIF financing for Centerpoint through his relationships with important local officials. In particular, Dunn said he believed he could persuade the Joliet mayor and an alderman to provide the TIF. 

Dunn repeated these boasts to Centerpoint. However, Centerpoint eventually learned Dunn was not as "interactive" with city officials as he had led Centerpoint to believe, according to court documents.

Tyrell later said Dunn made him look bad in Centerpoint's eyes, court papers said.

Mullen admitted in a deposition he initially praised Dunn for the three percent proposal, but did so only because he thought Dunn was "down on his luck" and felt sorry for him. Otherwise, Mullen believed the proposal was little more than a warmed over version of the Illinois EDGE development tax credit program, which, at that time, had been in place for several years.

Dunn has been represented by Leonard Law Offices, of Chicago.

Centerpoint and Mullen have been defended by Castle Law, of Joliet.

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Organizations in this Story

City of JolietCastle LawLeonard Law Offices Inc.CenterPoint PropertiesIllinois' Third District Appellate CourtCounty of Will

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