An appeals panel has ruled two former partners of McNabola Law in Chicago didn't breach any duties to their old law partners by allegedly stealing away clients and staff when they left to start their own firm, saying McNabola's lawsuit against the ex-partners was built on "speculation."
The decision was delivered Sept. 19 by Justice Mary Ellen Coghlan, with concurrence from justices Aurelia Pucinski and Michael Hyman of the Illinois First District Appellate Court. The decision was filed under Illinois Supreme Court Rule 23, which may limits its use as precedent.
The ruling favored Cogan & Power in an action brought against it by McNabola Law Group. Both firms advertise themselves as handling personal injury suits. McNabola Law is now run by Mark McNabola. His brother, Edward "Ted" McNabola, who once was associated with the McNabola Law Group, now runs a separate firm, McNabola & Associates, of Chicago.
Michael Cogan and John Power resigned from McNabola Law (previously known as Cogan & McNabola), where they had been partners, in 2012 to set up their own firm.
In 2015 in Cook County Circuit Court, McNabola sued Cogan and Power, alleging they breached their fiduciary duty by soliciting 75 McNabola clients while they were still with McNabola. The suit further claimed Cogan solicited Power to leave, and together they solicited a number of other employees to also depart. The suit included other defendants, but they were not part of the appeal.
Cogan & Power moved to have the fiduciary duty allegations tossed. Cook County Judge Daniel Kubasiak agreed, determining there was no evidence behind the allegations.
On appeal, Justice Coghlan approved Kubasiak's findings.
"The record does not reflect that Cogan solicited Power to leave McNabola Law Group. On the contrary, there is ample evidence that Power independently decided to leave after being dissatisfied with the firm for years," Coghlan pointed out.
Coghlan went on to note that two years before Power left the firm, he described the McNabola firm as "toxic" and "dysfunctional," with Power also saying "he didn't know whether he was in for the long run."
In addition, Power testified he stopped talking to Mark McNabola after Mark allegedly "cheated" him out of a $60,000 bonus, according to court papers.
The McNabola brothers also argued Cogan had a duty to tell them Power was thinking of leaving, but Coghlan noted there is no Illinois law requiring such notification.
As far as allegations Cogan or Power drew away other lawyers and support staff, Coghlan said she simply found inadequate evidence.
In a similar vein, Coghlan ascertained there was little to support McNabola's claim Cogan and Power lured away clients while the pair of lawyers were still with McNabola. In this connection, Coghlan pointed out 33 ex-McNabola clients submitted affidavits attesting they were not solicited before Cogan and Power resigned.
McNabola cited two clients who followed Cogan and Power as parts of a "mosaic" that showed a pattern of solicitation. However, Coghlan found no proof in the cases of these two clients, so she did not see them as showing a pattern.
"Speculation, conjecture, or guess is insufficient to withstand" a motion to dismiss the suit, according to Coghlan.
The suit continues in circuit court on counts against other defendants. A status hearing is Oct. 24.
McNabola Law Group has been represented by attorney Edward Feldman, of Miller, Shakman, Levine & Feldman, of Chicago.
Cogan & Power has been defended by James Figliulo, of Figliulo & Silverman, of Chicago.