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The Journal of the DuPage County Bar Association

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Volume 24 Issue 7 April 2012 INSIDE: Restaurant Guidelines for 22 Paying Tipped Employees Mayhem Looming in the

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President’s Message 5 Volume 24, Issue 7 by Colleen M. McLaughlin April 2012

Eric R. Waltmire News & Events Editor-in-Chief Terrence Benshoof The 2012 State of the Courthouse 9 Associate Editor President’s Ball Set for April 27, 2012 13 John J. Pcolinski, Jr. Speaker Announced for Law Day Luncheon 13 News Editor Judges and Faculty Named for DCBA Trial Advocacy Program 14 Sean McCumber DCBA Mega Meeting Draws Over 250 Attendees 14 Editor, Profiles DuPage Inn of Court Renamed in Honor of Robert E. Jones 18 Mark J. Carroll Editor, Student Articles Anthony Abear Articles Erica L. Bertini Mark J. Carroll Restaurant Guidelines for Paying Tipped Jonathan P. Crannell Employees Under the Fair Labor Standards Act: Michael J. Davis Avoiding the Hook in the Bait 22 by Jeffry J. Knuckles and Nicholas R. Galasso Ted A. Donner Joseph F. Emmerth IV Mayhem Looming in the Music Industry in 2013 28 Glenn Gaffney by Michael A. Biederstadt William D. Goren A Requirement of Life Insurance to Jon D. Hoag Secure a Maintenance Award Raleigh D. Kalbfleisch Allowable Under New Law 32 Shawn S. Kasserman by Victoria C. Kelly and Leah D. Setzen Deborah Klein Jeffrey J. Kroll James F. McCluskey Special Feature Sean McCumber Timothy B. Newitt On the Flipside of This Issue: John J. Pcolinski, Jr. The DCBA Grief #6 (April 2012 Edition) Melissa M. Piwowar Arthur W. Rummler James L. Ryan The DCBA Brief is the Journal of the DuPage County Bar Association (“DCBA”). Unless otherwise stated, all content herein is the property of the DCBA and may not be reprinted in whole or in part without the David N. Schaffer express permission of the DCBA. ©2012 DCBA. Opinions and positions expressed in articles appearing Daniel Walker, Jr. the DCBA Brief are those of the authors and not necessarily those of the DCBA or any of its members. Editorial Board Neither the authors nor the publisher is rendering legal or other professional advice and this publication is not a substitute for the advice of an attorney. Publication Guidelines: All submitted materials are sub- Jacki Hamler ject to acceptance and editing by the Editorial Board of the DCBA Brief. Material submitted to the DCBA DCBA Liaison/Advertising Brief for possible publication must conform with the DCBA Brief’s Writers Guidelines which are available Mary Anne McManus at dcbabrief.org. Advertising and Promotions: All advertising is subject to approval. Approval and acceptance of an advertisement does not constitute an endorsement or representation of any kind by the Desktop Publisher DCBA or any of its members. Contact Information: All Articles, comments, criticisms and suggestions should be directed to the editors at [email protected]. Cover photo by Jeffrey Ross APRIL 2012 1

From the Editor Three Things in Legal Writing That Impact Readability

By Eric R. Waltmire

here are two things document is important because we terns and instead forces the reader to wrong with almost all recall information best when receiv- slow down and read individual letters. legal writing. One is its ing information in the form of images Instead of using all caps for titles style.“T The other is its content.” and “the words on a page represent a or headings of sections in legal docu- -Fred Rodell, typographic image.” The Seventh Cir- ments, writers should utilize the fea- Yale Law School Dean, 19361 cuit Appeals Court views the article tures of word processors, such as using with such high regard that the court bold for emphasis, changing the font While Mr. Roddell may be over provides a link to the article on the size, or using a different type of font. stating it somewhat, I’d like to re- court’s homepage. If you want to be sure a title, heading, view a few points on the issue of style, Avoid All Caps. MANY PLEAD- or section is read, never use all caps as which negatively impact readability. INGS AND LEGAL DOCUMENTS it is shown to make the opposite more On Levity. Before turning to the HAVE TITLES, CAPTIONS, likely. issue of writing style, I note that it is HEADINGS, AND WHOLE PAS- Avoid Block Quotes. Judge Paint- a tradition in this publication to dedi- SAGES WHERE ALL THE LET- er of Ohio’s First District Appeals cate the flip side of the April edition TERS OF THE WORDS ARE ALL Court says, “No one reads long block as the DCBA Grief. As Mr. Rodell CAPITALS. You likely skipped right quotes.” 6 Dense single spaced and said regarding law reviews, “I know over reading the previous sentence. long block quotes are difficult to read. no field of learning so vulnerable to Why? It was too difficult or too much When reviewing briefs as a Staff At- burlesque, satire, or occasional pokes work to read. Studies show that the torney, I recall one party’s brief, which in the ribs as the bombastic pompos- average reader takes 12-13% more provided a single spaced block quote ity of legal dialectic.”2 This too can be time to read all caps and 90% of one that continued for three pages. As that applied to the DuPage legal commu- study’s participants preferred lower brief writer knew, it is easy to cut and 5 nity. On the flip side we present the case type over all caps. Continued on Page 6 DCBA Grief to impart satirical come- Ironically, a lawyer will often put dic relief and to avoid the accusation the most important items in all caps— Eric Waltmire is a registered patent at- that as editors we “knit [our] brows to emphasize the importance of it be- torney at the Erickson Law Group in overtime to purge [our] publica- ing read—when the very act of put- Wheaton, where he handles matters in tions of every crack that might pro- ting something in all caps ensures that the areas of patents, trademarks, intel- duce a real laugh.”3 I look forward it will be less likely to be read. Most of lectual property strategy, brand protec- to your letters. the titles to pleadings, motions, con- tion strategy, and anti-counterfeiting On Writing. In this piece I draw tracts, and articles that I have read are on a few concepts from the article presented in all caps. This should be strategy. While handling a range of titled Paint with Print: Incorporating avoided. The Paint with Print article patent subject matter, he focuses on the Concepts of Typographic and Layout explains that legibility of text is de- areas of Internet, computer science, and Design into the Text of Legal Writing pendent on quickly seeing the ascend- electronic technologies. Eric is a member Documents.4 As the title imparts, the ing letters such as “b” and “t” which of the ISBA IP Section Council and has article explores the concepts of and protrude above the midline and help served as the chairman of the Internet & the science behind “artful and logi- us see the words as visual patterns. But Computer Law Subcommittee. Before cal document design” to enable legal the use of all caps prevents us from us- joining the Erickson Law Group, he writers to present a more visually ef- ing the ascending parts of letters to was a staff attorney for the judges of the fective document. A visually effective speed reading by viewing word pat- Eighteenth Circuit Court of Illinois.

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have always had the utmost respect other hand want to take away one of the fact that the substantive clauses for those incredibly intelligent, in- the very things that makes it such; an of that Constitution are enforced by sightful men who drafted our na- independent judiciary. individuals independent of and not tion’sI Constitution over 235 years ago. th Do you remember your big 8 grade beholden to the elected branches.” I have been fortunate enough in my Constitution Test? Do you recall how -Harold H. Greene 30+ years as an attorney to have been much time your teachers spent talking ontrol. “It matters enor- involved in a number of cases that di- about “checks and balances?” How Cmously to a successful demo- rectly dealt with constitutional law is- can anyone wanting to lead this great cratic society like ours that we have sues. Whenever I read or re-read a sec- nation seriously contemplate messing three branches of government, tion of the Constitution, I marvel at with that concept? In my opinion, each with some independence and the foresight our founding fathers had, such comments show an incredible some control over the other two. at how they managed to create such a lack of respect for our Constitution. That’s set out in the Constitution.” sustaining document. Since so many others have said it bet- -Sandra Day O’Connor As part of the DCBA’s new strate- ter than me, I’ll let them say it for me: est of time. “There is no more gic plan, we drafted new bylaws this reason to think that they ex- year - the DCBA’s “constitution,” if ules. “The United StatesT Continued on Page 6 you will. And let me tell you, this RConstitution has proved itself the was NOT an easy task; trying to pro- most marvelously elastic compilation Colleen is the 3rd woman to serve as vide sufficient guidelines for every of rules of government ever written.” conceivable contingency yet leave the - Franklin D. Roosevelt president of the DCBA in its 134 year flexibility needed to address any situ- xcept. “All the rights secured to the history. Her commitment to the legal ation that may have been overlooked Ecitizens under the Constitution profession is evidenced by her active or that, over time, changes in its focus are worth nothing, and a mere bubble, involvement and the leadership roles she or purpose. Our General Counsel, except guaranteed to them by an in- has undertaken in the DCBA, the ISBA Gerry Cassioppi, and our entire by- dependent and virtuous Judiciary.” and DAWL. Colleen has served as a laws committee deserves a lot of credit -Andrew Jackson member of the DCBA’s Board of Directors for the time they have devoted to mak- afeguard. “Don’t interfere with since 1999. She is a past president of ing these very necessary updates. Sanything in the Constitution. DAWL (1994-95) and a past chair of the Now, I am not suggesting the draft- That must be maintained, for it is ISBA’s Labor and Employment Section the only safeguard of our liberties.” ing of an organization’s bylaws comes Council and its Committee on Law - Abraham Lincoln anywhere close to the complexities Related Education to the Public. She is osterity. “The Constitution of the involved in drafting a nation’s consti- a current member of the ISBA Assembly United States was made not mere- tution. Going through that process P and Assembly Agenda Committee. After however, just made me appreciate our ly for the generation that then existed, serving 16 years as an Illinois Assistant Constitution all the more. So, I can’t but for posterity- unlimited, unde- Attorney General, Colleen started for the life of me understand how some fined, endless, perpetual posterity.” her own Wheaton law firm in 1996, of our presidential hopefuls, the very -Henry Clay men and women who want to hold a lected. “The real difference be- where she concentrates her practice on Constitutional office, can on the one Etween the United States and other employment law matters, representing hand rave about our Constitution as nations lies not in the words of the primarily employees in state and federal the bedrock of democracy and on the preamble to the Constitution, but in court and before administrative agencies.

APRIL 2012 5 TY BAR A UN S O SO C C E IA G T A I P O

u N D President’s Message DCBA Continued from Page 5 S ince 879 1 pected the world to remain static are damn fools. Even Anton Scalia, one of the most conservative judges The DCBA Brief is a publication of the than there is to think that any of us DuPage County Bar Association holds a crystal ball. The only way on the Supreme Court has warned against changing our Constitution 126 South County Farm Road to create a foundational document Wheaton Illinois 60187 so that right thinking people control that could stand the test of time was (630) 653-7779 our nation’s government. He has to build in enough flexibility that stated in laying out a hypothetical: later generations would be able to Colleen McLaughlin “If we’re picking people to draw out adapt it to their own needs and uses“ President of their own conscience and experi- -Diane Wood Sharon Mulyk ence a ‘new’ Constitution, we should President-Elect The best quote by far is by John not look principally for good lawyers. We should look to people who agree Patrick B. Hurley Ciardi who stated “The Constitution with us.” He then rejected that ap- Second Vice President gives every American the inalienable right to make a damn fool of himself.” proach stating, “When we are in that Lynn C. Cavallo This is just one woman’s opinion, mode, you realize we have rendered the Third Vice President but, if you ask me, those candidates Constitution useless.” I suggest we all

Steven M. Ruffalo who want to eviscerate the judiciary chew on that for awhile. □ Past President Gerald A. Cassioppi General Counsel From the Editor Continued from Page 3 Bradley Pollock Assoc. Gen’l Counsel paste into your writing excerpts from ticeably slow reading speed. John A. Pleviak court opinions or other sources. But if Conclusion. There are numerous Secretary/Treasurer you want the content of the quote to other recommendations that I do not Arthur W. Rummler be read, you are better off paraphras- have space here to discuss, but which Assistant Treasurer ing or breaking the quote into mul- are well explained in the Paint with tiple one sentence quotes beginning Print article, such as, avoid centered Leslie Monahan successive quotes with transitions headings, use only one space between Executive Director such as “The court continued” or “The sentences not two, and reduce or elim- Angela M. Aliota court further provided.” In my view, inate the use of paragraph indents. Dion U. Davi the best way to ensure something will Lawyers use writing to persuade and Chantelle Porter not be read—other than putting it in convey information and we should James J. Laraia all caps—is to put it in a single spaced take every opportunity to use writing Timothy P. Martin block quote. styles that do this most effectively. □ Michelle L. Moore Emphasize with Bold and Ital- Terence C. Mullen John J. Pcolinski, Jr. ics not Underlining. The Paint with 1 Rodell, Fred, Goodbye to Law Reviews, Virginia Print article notes that the use of ital- Law Review, 23 Va. L. Rev. 38 (1936). Elizabeth A. Pope 2 Goodbye to Law Reviews at 40. Angel M. Traub ics and underlining both decrease 3 Id. reading speed and thereby decrease 4 Robbins, Ruth Anne, Paint with Timothy P. Whelan Print:Incorporating Concepts of Typogrphic Directors readability. The use of underlining and Layout Design into the Text of Legal appears worse than italic use because, Writing Documents, J. Assoc. of Legal Writing James F. McCluskey Directors, 2 JALWD 108 (Fall 2004). like the use of all caps, underlining ISBA Liaison 5 Id. at 11. also skews the visual pattern of words. 6 Painter, Mark P., Legal Writing 201, (March A. John Pankau 2002), at http://www.plainlanguagenetwork. Yet, the use of boldface does not no- org/legal/legalwriting.pdf Legislative Liaison

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News & Events Plus: President’s Ball Set For Chief Judge April 27, 2012 John Elsner 13 Speaker Announced Delivers His First for Law Day Luncheon Annual State of 13 Faculty Named for the Courthouse Trial Advocacy Program Address 14 Inn of Court Renamed For Bob Jones 18

Each year, at the DCBA’s Mega Meeting, the Chief Judge of the Eighteenth Judicial Circuit presents the State of the Courthouse Address, bringing members of the bench and bar up to date on what has happened and is happening in the courthouse. The following is a transcript of Chief Judge John T. Elsner’s address in January, 2012: became the 17th Chief Fiscella and Chuck Hoffman, and the like. The last item on Judge about a month and I inherited perhaps the the agenda was a flowchart. a half ago. I view my task finest court administrator in Dewey started by addressing Ias following the course that Illinois, John Lapinski. what happens when a traffic has been set by outstanding Shortly after becoming ticket is sent to the clerk’s chief judges like Steve Chief Judge, I met with office.After five minutes, I Culliton, Anne Jorgensen, the Clerk of the Court, stopped Dewey. He wanted Bob Kilander, Tom Callum Chris Kachiroubas, and his to know if I needed more and Mike Galasso. Just as deputy, Dewey Hartman. detail. Quite the opposite, those Chief Judges were We went over points of I told him. I only want to aided by excellent court business, including the need know that when documents administrators like Bob for clerks on pretrial days, Continued on Page 11

Photo by Jeffrey Ross APRIL 2012 9

Will County need additional court civil cases or about 22, 500 cases in- Judge Elsner space. We have adequate space to volve E-Filing. The benefit to lawyers Continued from Page 9 grow. In some counties the Clerks to be able to file a case or a civil mo- are filed, they are accurately stored, and the County Board are at odds and tion electronically is self evident. The and can be retrieved electronically or even have expensive court battles. In advantage to our court is that it lessens in hard copy by the judges, lawyers or DuPage, our officials act in the spirit the parking needs and reduces lines at members of the public. The compli- of cooperation. the clerk’s office. We have to keep en- cated flow chart and abundant figures We also have an excellent Bar As- couraging attorneys to take advantage were not necessary. sociation that provides outstanding of E-Filing. A natural extension of E- To prepare for today’s talk, the CLE programs and supports vari- Filing is scheduling a court date and Clerk and my staff have given me a ous judicial programs such as Night time for the presentation of a motion lot of complicated flow charts and Court and the Domestic Relations electronically. I am currently working abundant figures. I know that you’re Help Desk. This positive and sup- with the Clerk of the Court to imple- no more interested in listening to a lot portive relationship only enhances ment E-Scheduling. This would allow of figures than I am in reading them. and improves our judicial system. I attorneys to schedule cases over the Most court calls have a small re- internet. duction in the number of new fil- Criminal cases are not cur- ings over the past year with two rently approved by the Su- major exceptions. The number of preme Court to be part of traffic cases is down more than E-Filing. The Administrative 30,000 tickets, while the numbers Office of the Illinois Courts of foreclosure and forcible filings has confirmed that there is no have increased to record levels. In- prohibition against E-Schedul- stead of focusing on numbers and ing of presentment of motions charts I want to focus on the State in criminal cases. I am working of the 18th Judicial Circuit. The with the Clerk of the Court to State of our Circuit is excellent make this idea a reality. and I believe that our relationship E-Signature is a program with the Bar is also excellent. where an order is drafted elec- When I tell you that the State tronically. The trial judge then of the Courthouse in DuPage enters the order. The benefits of County is the best of all the cir- E-Signature are that the order cuits, some of you think that this is automatically entered into statement is hyperbole. I assure DUCS which makes it instant- you that it is not. Many of you know urge all judges and lawyers to be in- ly available to all the attorneys autho- that the Illinois Constitution of 1970 volved in the DuPage County Bar As- rized to use DUCS, eliminates paper establishes the Conference of Chief sociation. I want to address our use and streamlines the Clerk’s Office. Judges. In this capacity, all of the to technology, Specialty Courts and The E-Signature project has been Chief Judges in the State of Illinois some recent changes at the Court- a success in felony. The project will meet each month. house. soon proceed to the misdemeanor During the two meetings that I Technology. Those of you who courts. The assistant state’s attorneys have attended, it was apparent that have read the DCBA Brief know and local prosecutors have already DuPage County suffers from an em- that I never owned a cell phone be- been trained on E-Signature. Once barrassment of riches. The County of fore becoming Chief Judge. Although E-Signature is established, in criminal DuPage has always exceeded its statu- I don’t often use a cell phone, I keep cases, then the Clerk can make a case tory and Constitutional obligations to current with technology and embrace for it being used in other divisions. adequately fund the court. The Coun- it when it makes our jobs easier and I’m not sure whether E-Signature will ty Board, through the leadership of more efficient. ever be appropriate for Domestic Re- Bob Schillerstrom and Dan Cronin, The ability to file a case and sum- lations or the Civil Division. We will has always funded the necessary per- mons or a motion in a civil action, not expand this technology if it cre- sonnel positions and programs. electronically has existed for over four ates more work instead of being labor Lake County, Kane County and years. Currently about 65 % of the Continued on Page 16 APRIL 2012 11

Scenes from the 2011 President’s Ball President’s Ball Set For April 27, 2012 By Terrence Benshoof

he DCBA’s annual recogni- back nearly 100 years, to the days of some accommodations to the present) tion of the contributions to speak-easies, zoot suits, flappers and will be cool. Our outgoing President, the Association and the legal feathers: a Roaring 20s theme. Colleen McLaughlin, promises that communityT by our former presidents The night starts with cocktails (but this will be a fun-filled night to be will take place at the Medinah Coun- all the hootch will be perfectly legal!), enjoyed by all. Seating for the Presi- try Club on April 27, 2012. Now cel- and hors d’oeuvres at 6:00 p.m., fol- dent’s Ball is limited, and tickets will th ebrating its 19 year, the black tie op- lowed by a plated dinner at 7:00 p.m. sell out quickly. For more informa- tional event borrows a bit on last year’s Then it’s into the casino, where the tion, contact the DCBA at (630) 653- President’s Ball, with casino night fun, dice are hot, and the dancing to the 7870, or go online at dcba.org. □ but adding the twist of taking things music (spun by a DJ- we have to make Speaker Announced for Annual Law Day Luncheon By Arthur W. Rummler

espite the mild winter, it still represents several detainees housed at and Mock Trials. Ask a Lawyer Day may be hard to imagine that the U.S. military base in Guantanamo is where lawyers take over the phones spring is actually only a few Bay, Cuba. at the DCBA and answer legal ques- Dweeks away. Yes, the glorious green Ms. Gorman’s work has been in- tions from the general public. Ask a of spring means longer, warmer days strumental in the area of constitution- Lawyer Day is set for Saturday, April and of course, the Annual DCBA al law as it applies to the ongoing war 28, 2012. Law Day Luncheon which will take on terror. Her position on the front The successful Mock Trial program place on May 3, 2012 at Cantigny. lines of civil liberty will enable her to introduces students in grades 6 – 12 The theme of Law Day 2012 is “No share insights and experiences that to the courthouse and the inner work- Courts, No Justice, No Freedom.” will be of interest to lawyers, judges or ings of a hypothetical trial. Mock This year, the DCBA is building on anyone interested in the protection of Trials are set for Friday, May 4th. If past Law Day successes with another the freedoms guaranteed by the Unit- you are interested in volunteering for timely, relevant and locally connected ed States Constitution. either Ask a Lawyer Day or for Mock speaker for our event. The keynote In addition to the annual lun- Trials, please contact Liz Whitney at speaker will be H. Candace Gor- cheon, DCBA Law Day activities the DCBA (630-653-7779). □ man, a Chicago based attorney who will also include Ask a Lawyer Day

APRIL 2012 13 Judges and Faculty Named for DCBA Trial Advocacy Program

he DCBA will hold the Keith Bledsoe. Judges for the program pects of trial practice including jury E. Roberts, Sr. Trial Advocacy include Hon. Bonnie Wheaton, selection, opening statements, clos- Program on four consecutive Hollis Webster, Ronald Sutter, ing arguments, direct and cross ex- SaturdayT mornings starting on April Dorothy French, Patrick Leston, aminations and making and preserv- 28, 2012 at the DuPage County and William Ferguson. ing a proper record for appeal will be Courthouse. The program is to The tuition of $385.00 includes covered through a combination of develop and train the trial skills of all books and materials. The program demonstrations, hands on exercises lawyers of all levels of experience. texts will be Trial Techniques and and will conclude with a mock trial. Instructors for the program include Materials in Trial Advocacy by re- The program will admit 40 lawyers so Angelo Spyratos, Chuck Roberts, nowned trial expert Thomas Mauet. space is limited. For more informa- Jamie Lane, John Gilligan, Tom Sessions will be held from 8:00 am tion contact Leslie Monahan at 630- Knight, Julie Cibulskis and Susan until 12:00 pm on each day. All as- 653-7779. □

Scenes from Mega Meeting 2012 Photos by Jeffrey Ross DCBA Mega Meeting Draws Over 260 Attendees

his year the Mega Meeting presentations on family law, estate Company; ATG Guaranty Fund, Inc. was held on January 28, 2012 planning & probate law, or civil and ; Illinois Investigative Solutions; Wolf at the Lisle Hilton. Over 260 appellate law. The afternoon sessions & Company; Minnesota Lawyers TDCBA members and guests attended included presentations on real estate Mutual; ISBA Mutual Insurance this year’s Mega Meeting. ARDC law, criminal law, and employment Company; Pearl Insurance; Reason Chief Counsel James Grogan gave a and business law. The DCBA Financial Advisors, Inc. ; CourtCall ; lively presentation on professional thanks the following exhibitors and ADR Systems; Fidelity National Title responsibility and ethics. Chief Judge sponsors for their support of this Insurance Company; Bold Steps, Inc. John Elsner presented his State of important event: Richard M. Ferrari ; Alpha Graphics; Keffer Financial the Courthouse Address over lunch. of Edward Jones Investments; Mila Planning; DiGiovine Hnilo Jordan & The morning sessions includedCarlson & Associates; ATG Trust Johnson Ltd.; and Family Solutions. □

14 Dcba BRIEF APRIL 2012 15 jury. The policy also prohibits media lected in fines, restitution and fees. Judge Elsner coverage of juvenile, divorce, adop- The recidivism rate of graduates since tion, and evidence suppression or 2007 is 8.02%. This compares to a Continued from Page 11 trade secret cases. If we become part 25% recidivism rate after only 2 years saving. I will look to the Bar for its in- of this pilot program, we can plan for for Non-Drug Court drug offenders. put prior to implementing this tech- the future. It seems readily apparent Veteran’s Track is a program which nology in those divisions. that the Supreme Court is moving will fall squarely into the existing Even the Appellate Court, as you in the direction of allowing cameras. programs and promote the same heard this morning, as a result of the I feel that it is important to have the goals. Anyone who has been gener- efforts of our own Justice, Anne Jor- input of attorneys in this decision. ally or honorably discharged from the genson, is seeking to become paper- Therefore, I am requesting the cre- United States Armed Services, and less. Once this project is accepted by ation of a Bench/Bar/Media Commit- who otherwise qualifies under the the Supreme Court, we will no longer tee to investigate and make specific respective statutes is eligible. Except have to send the paper records to El- recommendations on implementing for identifying an applicant as a quali- gin. Isn’t this why they invented the cameras in the courtroom. Judge Kin- fied Veteran, the application process is internet? sella will be our lead judicial represen- nearly identical. This program recog- Court Reporters. Earlier this tative. nizes the incidence of traumatic brain week, Judge Creswell told me that the Specialty Courts. Throughout Il- injury, post-traumatic stress disorder, court reporters have one computer linois, there are courts springing up substance abuse and mental illness terminal and one e-mail address. This known as “specialty courts”. In Du- in this population. It seeks to reduce causes delays in the use of DUCS by Page County, we simply call it “Judge crime through judicial and therapeu- reporters, as well as delays in transmit- Mitton’s Call”. Her call includes tic intervention utilizing the resources ting transcripts electronically. The so- MICAP, Drug Court and Veteran’s provided through the Veterans Ad- lutions to these problems are simple. Court. MICAP is a diversionary pro- ministration. This specialty court is Add more terminals and get each re- gram for persons who suffer from new, however, Judge Mitton is enthu- porter her own address. This will be mental illness. It is intended to re- siastic about its addition. accomplished within weeks. duce the stigma of a criminal record Chancery. There is a physical I assume all of you know that of- for persons with mental illness and change in the Chancery Division as ficial court reporters can provide daily improve the participants’ overall qual- well as a change in caseload. There was copy. Also, you can receive transcripts ity of life. It aids our system in that a problem occupying the first cham- electronically. I hope more attorneys it increases their productivity, reduces bers in the Chancery Division. Any- will take advantage of these options. the time and cost of incarceration and one was allowed in that part of the Pilot Program for Cameras in psychiatric hospitalization. The court hallway. The amount of traffic made Courtrooms. Earlier this week, the structure in this program is designed the chambers highly undesirable. Supreme Court entered an order es- to be non-adversarial. Since 2007, When I asked why all these persons tablishing a pilot program for cameras there have been 237 graduates of this were doing business in the secured in the courtroom. It allows the Chief program with a recidivism rate of only hallway, I was told that this is the Judge of each circuit to decide wheth- 9.7%. way Judge Teschner wanted it, twenty er or not to apply to be part of the Drug Court’s primary goal is to re- years ago. Just because this is the way pilot program. duce the incidence of drug use, addic- that we have always done it, does not If the Chief Judge requests to be tion, and crime through judicial inter- mean our systems cannot be improved part of the program, then the news vention coupled with close monitor- upon. Small changes were made to the media can request extended media ing and psychological guidance. The reception area. The chambers is now coverage at least 14 days prior to a drug court program is defined by stat- quiet and the secretaries have more proceeding. Extended media coverage ute. Our Drug Court Team utilizes room. can be denied by the Chief Judge or rewards and sanctions on a progres- I’ve tried to make a point of not the trial judge. This decision is not ap- sive basis to reinforce positive behav- speaking about judges because, if you pealable. ior and deter negative behavior. This talk about some, those not mentioned Limitations on coverage include is an effort to encourage, support and will be offended. I want to make an the prohibition of coverage of a sexual monitor individuals’ recovery from exception to that rule. Custom has it abuse victim testifying and the selec- drug addiction. There have been 226 Continued on Page 18 tion or coverage of any member of a graduates. $306,440 has been col-

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To help your clients evaluate their options and understand our role, John T. Miller call us to set a time to meet: Cammy Corso CPA, CFP, CDFA CPA, CFP, CDFA 630-420-1360 [email protected] [email protected] there were two choices; contract with our associate judges. The associate Judge Elsner Kane County and budget $1.6 mil- judges handle the largest court calls Continued from Page 16 lion or fully fund the Youth Home with some of the most difficult liti- that Circuit Judges have a choice of at about $3.2 million. The County gants. calls. When Bob Gibson was appoint- chose to close the Youth Home and Our associates have to resolve is- ed Circuit Judge, he asked to be as- contract with Kane County to house sues that have been raised without signed to the most difficult call in the our youths. warning. They can be called upon to courthouse, foreclosures and forcibles. I believe that the combined re- do multiple calls on a moment’s no- This is the only call to grow in the sources will allow for one better fa- tice. In my opinion, they are simply, number of cases filed. As you know, cility than two lesser facilities. The the best. foreclosures are at a record level. Supervising Judge of Juvenile, Judge We recently interviewed applicants Judge Gibson has done a fantastic Anderson, toured the Kane County for associate judge. There were a large job showing patience and compas- facility. I’m sure that Judge Anderson number of excellent candidates. Based sion, yet following the law. I noticed will keep fully informed on Youth on this applicant pool, I can tell you that the volume in his court was sig- Home issues. that the future of our Circuit is secure. nificantly larger than any other court, Judicial Internships. Today in- We think the new Associate Judge will even though he never complained. I ternships are a necessary part of a be join us in early March and be as- decided to take action. strong resume. There are good intern- signed to traffic court. [Since this pre- Starting the first of the year, forc- ships and bad internships. I think that sentation was given, Robert Douglas ible cases were taken from chancery. the hallmarks of a good internship is has been given the appointment]. On Wednesdays, forcibles will be one that is thought out, makes the New Judges. I join you in welcom- heard in small claims. On Thursdays, maximum use of the interns’ time ing Judge McGimpsey as our [then] forcibles will be heard in arbitration. and gives the intern insights he or she newest judge. Also, Judge Orel is do- Domestic Relations. In the inter- would not otherwise experience. ing a tremendous job in arbitration, est of equal time, I want to mention We should start now if we want to while Judge Coco is helping Judge Judge McKillip in Domestic Rela- implement a judicial internship pro- Anderson in Juvenile Court. Judge tions. As the attorneys on the third gram this spring or summer. I suggest- Else was volunteered to handle the floor can attest, he is one of our fined putting together a program and Domestic Violence Call. est and most hard working associate checklist to be used in that program. Conclusion. I expect DuPage will judges. Judge Brennan, Judge Marchese and remain the finest circuit in Illinois as You have no doubt read about the Judge Fullerton have been coerced it partners with the DuPage Bar Asso- decision to close our Youth Home. into putting this program together. ciation and the County of DuPage in This was a topic which Judge An- Credit to Associates. If you agree providing justice for all who use our derson was very passionate about. with me that DuPage is the premier circuit. Thank you for your kind atten- Judge Culliton told the County that Circuit in Illinois, the credit goes to tion. □

DuPage Inn of Court Renamed in Honor of Robert E. Jones By John J. Pcolinski, Jr. he DuPage American Inn ciation for his many years of service The local Inn is chapter affiliated of Court was renamed in to the legal profession and friendship with a national organization, the honor of Robert E. Jones on to our members,” said Inn President, American Inns of Court. The orga- TWednesday, January 25, 2012. The Brad Pollock, of Walsh, Knippen, nization is designed to improve the new name is The Robert E. Jones Knight & Pollock. Tom Ryerson ad- skills, professionalism, and ethics of American Inn of Court. “Bob was dressed the entire Inn at the begin- the bench and bar. The local Inn is an involved with our organization at its ning of its program and explained, amalgam of DuPage County lawyers inception in the 1990s, and was the “This renaming is not intended as a and judges which meets approximate- moving force behind its reorganiza- memorial or a gift to Bob; it is a gift ly once a month both to “break bread” tion after a period of inactivity. We from Bob to the Inn.” The Inn’s mem- and to hold programs and discussions thought it only fitting to recognize his bership unanimously approved the re- on matters of ethics, skills, and profes- contributions and express our appre- naming in honor of Bob Jones. sionalism. □

18 Dcba BRIEF Articles Restaurant Guidelines for Paying Tipped Employees Under the Fair Labor Standards Act: Avoiding the Hook in the Bait 22 by Jeffry J. Knuckles and Nicholas R. Galasso

Also: Mayham Looming in the Music Industry in 2013 28 by Michael A. Biederstadt

A Requirement of Life Insurance to Secure a Maintance Award Allowable Under New Law 32 by Victoria C. Kelly and Leah D. Setzen

APRIL 2012 19

From This Month’s Articles Editor

Maintenance, Tips, © REP3.com photo and The Village People By Sean McCumber

s we roll past the yuck that Victoria Kelly and Leah Setzen is winter in Illinois (even have written an article about the though we got off light this changes in the Illinois Marriage Articles from Awinter), it is time to start thinking and Dissolution of Marriage Act as Lawyers & Paralegals of warmer weather, funny articles to maintenance and how support is in the Grief, and the usual changes calculated. The changes under the The articles published in this mag- to the law that sneak up on us as we new law went into effect on January azine are generally contributed by lawyers and paralegals who are venture into the new year. Some of 1, 2012. Turn to their article for members of the DCBA. If you are the changes are actually in new laws, changes to the Illinois Marriage and interested in submitting an article while others changes long anticipated Dissolution of Marriage Act that to be considered for publication in (or feared), yet slightly forgotten till allow the court to order a party to the DCBA Brief, please contact the they arrive. purchase life insurance to secure a magazine’s Editor, Eric Waltmire, Jeffry Knuckles Nicholas R. at [email protected]. Our pub- and maintenance award. lication guidelines for author sub- Galasso have written a primer for But while maintenance, tipping missions appear at dcbabrief.org/ restaurant owners regarding tipped your waitresses, and the Village submissions.html. Practicing at- employee and minimum wage credits People are important topics, this torneys whose articles are selected under the Fair Labor Standards Act. issue is filled with very important for publication in the DCBA Brief The article reviews new regulations announcements for the upcoming are qualified to receive CLE credit under the applicable Illinois rules. by the U.S. Department of Labor months, case law and legislative regarding the hourly wage paid updates, and of course, the Grief. As to tipped employees. The article a final aside, I disavow all knowledge Student Articles provides a step-by-step compliance of the Grief edition, unless you The DCBA Brief has a long stand- checklist to ensure employers can laughed furiously. Then I claim full ing commitment to providing a legally pay tipped employees below credit. □ forum for law students in the Chi- normal minimum wage by taking cago metropolitan area. If you are credit for tips that will be received. a law student who attends one of Michael Biederstadt these schools or otherwise has an analyzed a Sean McCumber is a partner at interest in the practice of law in new development in copyright law Sullivan Taylor & Gumina, P.C. in DuPage County, you can join the that has been brewing for 35 years, Wheaton, Illinois and a long-time DCBA for no charge and are then the termination of copyright grants resident of DuPage County. He con- eligible to contribute articles to be considered for publication. If by authors and artists under the centrates his practice in family law – Copyright Act of 1976. This means you have interest in submitting a divorces, paternity cases, child custody student article, please contact our that some artists may be able to disputes, domestic partnerships, guard- Student Articles Editor, Mark Car- recover from their record companies ianships, adoptions, and juvenile law. roll at [email protected]. copyrights in music the artist created. He is active in the Family Law, Child Michael provides interesting case Advocacy, and Legal Aid Committees reviews involving musicians such as of the DCBA. Bob Marley and the Village People. APRIL 2012 21 Restaurant Guidelines for Paying Tipped Employees Under the Fair Labor Standards Act: Avoiding the Hook in the Bait

By Jeffry J. Knuckles and Nicholas R. Galasso

his article is designed to highlight cases which have recently interpret- ed various sections of the Fair Labor Standards Act, 29 U.S.C. §§ 201 et seq. (the “FLSA”), as it applies to tipped employees in the restaurant Tindustry (wait staff, bartenders, etc.). The law itself, of course, is not industry specific, and applies across the board to virtually every business or enterprise. However, with the advent of class actions and an aggressive plaintiff’s bar of talented attorneys, restaurants and their owners have become “targets” in litigation. A few simple examples from cases in the federal courts may serve to re- mind the restaurant industry of its federally mandated obligations to its hourly/tipped employees. In that regard, a “self audit” of internal policies, record keeping, and compensation models may insulate the enterprise from liability. The internal, or self-audit, is vital for another, more (regardless of the outcome) will certainly have an adverse practical reason: claims and/or losses, and the defense local impact on customers, and revenue. Since both for- thereof, are not insurable risks. As a consequence, the cost mer and current employees may be part of a plaintiff’s opt- of defense, payment of any adverse judgment, and pay- in class against the employer/entity, a natural and often re- ment of plaintiff’s attorney’s fees should the plaintiff “pre- sentful attitude will result that will continue the downward vail”, comes from the pocket of the company and/or its spiral of the enterprise. owner-officers, not its insurer. Hence, a small investment This Article also includes a simple and important check- now, to tidy up policies and compensation matters, is a list that serves as a guideline to compliance for your inter- certain hedge against future, and more profound, losses nal policy audit—a shield, if you will, against the barba- due to claims under the FLSA. rous consequences of litigation. Finally, the negative publicity generated by litigation Legislative History. In order to give historical perspec- 22 Dcba BRIEF tive to the following discussion, it’s important to appreci- The original bill contemplated that enforcement of the ate the environment that existed at the time of the 1938 bill’s provisions would be vested in a labor board (e.g., the legislation that, after dozens of amendments, became the setting of minimum wages, causing suits to be filed on be- Fair Labor Standards Act, in particular its minimum wage half of employees against employers, etc.). However, the aspects that pertain to “tipped” employees. final version of the originally-enacted FLSA sought to de- The 1930s was a tumultuous period that endured the fray the cost to the government, and thus the taxpayers, of Great Depression and the challenges that came with it. enforcing the FLSA’s provisions by allowing employees to Also at this time, employers had significant leverage over (i) file suit on their own and (ii) recover attorney’s fees for their workforce. There were no successfully demonstrating a viola- 2 minimum wages, and so the “com- Jeffry J. Knuckles tion of the FLSA by an employer. petition” in the free market of labor is Of Counsel to Thus, the purpose of the attorney’s was the only mechanism by which the firm Nyberg & fees provision was to shift the bur- wages were calculated. Similarly, Cassioppi, LLC, lo- den and cost of (meritorious) suits the number of hours worked in a away from the government (i.e., cated in Naperville. given week was also unregulated, taxpayers) and employees, and to Jeff graduated from again with the demands of employ- the employer. It seems fairly clear ers generally dictating labor stan- the University of based on the Congressional Record dards. This formula, combined Illinois in 1968 that Congress envisioned a suc- with a struggling and rebuilding with a Bachelor of Arts degree in Medieval cessful suit to mean some demon- economy that garnered more de- Literature. Jeff received his Juris Doctor stration by the employee that the mand for jobs than the supply of from the University of Illinois in 1973. employer committed a grave, egre- work, lead to nationwide unfair gious, systematic or willful viola- treatment of the labor force, espe- tion of the FLSA. cially in manufacturing and indus- Nicholas R. Galasso Over time, the FLSA has been trial-type enterprises. Despite the is an Associate with expanded to include nearly every employers’ argument that any min- the firm Nyberg type of industry in any locale do- imum wage or maximum hours- & Cassioppi, ing any type of business (and not worked standards would drive up LLC, located in just manufacturing/industrial busi- costs for employers and businesses, Naperville. Nick nesses engaged in interstate com- thereby decreasing output and graduated from merce). This expansion is attrib- stalling the economy, the Congress utable to both legislative amend- Illinois Wesleyan thought better of it and laid the ments and nearly 75 years of case University in 2007 with a Bachelor of groundwork for the wage and hour law interpreting the FLSA. Arts degree in Accounting and Economics. system as we know it today. Minimum Wage and the The general purpose of the origi- Nick received his Juris Doctor from The Tipped Employee. Federal Regu- nal bill was threefold: (1) To pro- John Marshall Law School in 2010. lations allow a restaurant a credit vide a method of obtaining mini- against paying the full minimum mum wages and maximum work- wage, so long as the employee cus- ing hours in industries engaged in the transportation of tomarily and regularly receives more than $30 per month goods in interstate commerce. (It is interesting to note that in tips.3 The commonly understood prerequisites for the the original bill specifically excluded local businesses and employer to pay less than the minimum wage (take ad- the services industries from any minimum wage or maxi- vantage of the tip credit) require compliance with section mum hours standards.); (2) to provide for (legal) action 203(m) of the Act: “In determining the wage of a tipped against those businesses/employers engaged in, or having employee, the amount paid such employee by his employ- a substantial effect on, interstate commerce and violating er shall be deemed to be increased on account of tips by the bill’s provisions; and (3) to prohibit the transportation an amount determined by the employer, but not by an of goods produced by children in interstate commerce.1 amount in excess of 50% of the applicable minimum wage It is clear that each of the three aims of the original bill rate.”4 required the involvement of interstate commerce in order To take advantage of the credit, the following must occur: for the bill’s provisions to apply. 2 83 Cong. Rec. 9264 (June 14, 1938). 3 29 U.S.C. § 203(t); 29 CFR §§ 531.50, 531.56, 531.59. 1 81 Cong. Rec. 7648 (July 27, 1937). 4 29 U.S.C. §203(m); 29 CFR §§ 531.50, 779.17.

APRIL 2012 23 (1) The employee must be informed by the employer of the re v. Outback Steakhouse of Florida, Inc8 sought to answer provisions of section 203(m); and (2) 29 C.F.R. § 516.28 two questions: What information must the employer pass requires that the employer also maintain and preserve the along to the employee and how may the employer convey following records for a tipped employee: (a) A symbol or that information.9 letter placed on the pay records identifying each employee In Kilgore, the defendant-employer had provided its whose wage is determined in part by tips; (b) Weekly or employees with a “file folder” containing various written monthly amount reported by the employee; (c) Amount by materials, including a statement describing the employer’s which wages of each tipped employee have been deemed tip policy. This written statement fully quoted § 203(m) to be increased by tips as determined by the employer; and expressly informed the reader that “tips will be used as (d) Hours worked each workday…in which the employee a credit against the minimum wage as permitted by fed- does not receive eral and/or state tips, and a total law.”10 The Sixth daily or weekly Circuit held that straight-time Since both former and current the written ma- payment made terials provided by the employer employees may be part of a plaintiff’s by the defendant for such hours; adequately in- (e) Hours worked opt-in class against the employer/ formed the em- each workday… entity, a natural and often resentful ployees of the in which the tip credit, and employee re- attitude will result that will continue therefore satisfied ceives tips, and the employer’s § the total daily or the downward spiral of the enterprise. 203(m) notice weekly straight requirement as to time earnings those employees for such hours; who actually re- (3) The tipped employee retains all tips received (though ceived these materials.11 29 U.S.C. § 203(m) does not prohibit the pooling of tips The Sixth Circuit held that an employer “must inform among employees who customarily receive tips). the employee that it intends to treat tips as satisfying part Conversely, failure to inform the employee that the res- of the employer’s minimum wage obligation.”12 The Sixth taurant would be receiving a tip credit to offset its mini- Circuit explained: “[W]e conclude that an employer must mum wage obligation voids the credit, makes the restau- provide notice to the employees, but need not necessar- rant liable for the full minimum wage. In other words, the ily ‘explain’ the tip credit…. The statute requires that the tip credit does not turn on whether the employee actually employee be ‘informed’ of the tip credit.” 13 There court received the tips, but on whether the restaurant statutorily continued, “‘[I]nform’ requires less from an employer than met its notice requirements. In Richard v. Marriott Corp.5 the word ‘explain’ would.”14 the court noted that the statute allows a restaurant em- The U.S. District Court for the Northern District of ployer a tip credit only if it precisely followed the language Indiana in Davis v. B & S, Inc.15 stated, “The Kilgore de- of section 203(m). cision demonstrates that an employer may meet the no- To qualify for the tip credit, an employer must dem- tice requirement simply by providing conforming written onstrate, among other requirements, that the “employee materials to its employees.”16 The court continued, “This has been informed by the employer of the [tip credit] holding is supported by dicta from other decisions indicat- provisions….”6 However, there is conflicting authority on ing that an employer can satisfactorily convey notice of whether the employer must not only notify the employee but also explain the tip credit.7 The Sixth Circuit in Kilgo- 8 160 F.3d 294 (6th Cir. 1998). 9 Id. at 298. 10 Id. at 299. 11 Id. 5 549 F.2d 303, 305 (4th Cir. 1977). 12 Id. at 298; see also Davis v. B & S, Inc., 38 F.Supp.2d 707, 718-19 6 29 U.S.C. § 203(m). (N.D. Ind. 1998). 7 Kilgore v. Outback Steakhouse of Florida, Inc., 160 F.3d 294 (6th 13 Kilgore, 160 F.3d at 298. Cir. 1998) (explanation not required); Brennan v. Haulover Shark 14 Id. and Tarpon Club, Inc., 1986 WL 587 (S.D. Fla. 1986) (explanation 15 38 F.Supp.2d 707. required). 16 Id. at 719.

24 Dcba BRIEF the tip credit by way of a poster, if the content of the poster Opt-In Class Actions. Assuming that an employee can is otherwise sufficient and it is prominently displayed.”17 allege that the restaurant has, in some manner, violated the The court in Davis went on to extend the acceptable means FLSA, then the single employee suddenly gains clout by by which notice may occur: “[I]f an employer can satisfac- filing a motion under section 216(b) asking the court to torily meet the notice requirement of § 203(m) by sim- conditionally certify a class, consisting of all current and ply providing its employees with a file folder containing former (going back up to three years) employees. the relevant information or by prominently displaying a In short, the single employee now has the ability to con- poster, then it follows that the notice can also be conveyed vert a seemingly small claim into a far-reaching class rep- to employees through an individual co-worker regardless resenting himself…and other similarly situated employees. of whether that individual meets the technical definition There is a two-tiered approach applied: (1) The court must of “employer” under the FLSA.”18 make a preliminary decision (the “notice” stage) whether a Therefore, a prominently displayed poster or file folder notice of the pending action should be sent to other cur- given to employees containing the relevant portions of the rent/former employees, giving them an opportunity to tip credit provision of the FLSA would likely satisfy the “opt-in” to the class; (2) After this conditional certification notice requirement under Kilgore and Davis. (which is leniently granted), the case proceeds through dis- On May 5, 2011, the Department of Labor issued regu- covery (depositions, etc.) and then a final determination is lations which aim to clarify the meaning of “inform” as made by the court as to the size of the class. well as the employer’s requirements regarding notice. The Imagine the consequences of each of your current, and new regulations19 provide that the employer must, in order former employees, receiving a written notice, describing to take the tip credit, inform its employees of the follow- the allegations against your restaurant, and giving them a ing: (1) The amount of the cash wage to be paid by the written consent form to “opt in”, along with the name and employer to the tipped employee; (2) The amount of tips phone number of their law firm. Since most of the plain- to be credited as wages toward the minimum wage; (3) tiffs’ cases are prosecuted on a contingent fee, there aren’t That all tips received by the employee must be retained even cost barriers to the employees, who’ve experienced by the employee except for tips contributed to a valid tip similar wage problems, from opting into the case. The case pool limited to employees who customarily and regularly of Flores v. Lifeway Foods, Inc.21 notes that a named plaintiff receive tips; (4)That the tip credit shall not apply to any can show that others were similarly situated “by making a employee who has not been informed by the employer modest factual showing sufficient to demonstrate that they of the provisions for a tip credit; and (5) For employers and potential plaintiffs together were victims of a common that require tip pools, any required tip pool contribution policy or plan that violated the law.” amount or percentage, including notice that the tip credit Given such a low bar, courts will routinely permit simi- may be taken only as to the amount the server actually larly situated current and former employees to join the ac- receives, and that the employer may not retain any of the tion. server’s tips for any other purpose. 20 While employers may Attorney’s Fees. Once the case proceeds to either settle- give the foregoing notice orally, it is highly advisable to do ment or trial, one of the overriding financial issues restau- so in writing and obtain each employee’s signature affirm- rants must deal with relate to attorney’s fees. Keep in mind ing his/her understanding of the notice’s provisions. that the defendant restaurant must engage its own counsel to defend the case. The “hook in the bait”, as we call it, 17 Id. (emphasis added) (citing Marshall v. Gerwill, Inc., 495 F.Supp. is simply that the plaintiff is also entitled to have his/her 744, 753 (D.Md. 1980) (“There was no credible evidence proved attorney’s fees paid by the defendant restaurant if plaintiffs or proffered as to what exactly had been told to the drivers concerning the tip credit provisions or even if any information are deemed to be the prevailing party under the statute: “A was contained in any poster or bulletin provided to the drivers.”) court shall, in addition to any judgment awarded to the (emphasis added); Bonham v. Copper Cellar Corp., 476 F.Supp. plaintiff, or plaintiffs, allow a reasonable attorney’s fee to 98, 101, n. 8 (E.D. Tenn. 1979) (noting that a poster containing 22 information relevant to the FLSA notice provision was displayed be paid by the defendant….” The Seventh Circuit had in the workplace, but holding that the poster did not satisfy the said, “While the award of fees is mandatory [under the notice requirement because it was not prominently displayed, FLSA], the district court has ‘wide latitude’ in determining employees were not directed to it, and its contents were not 23 introduced at trial). Cf. Martin v. Tango’s Restaurant, Inc., 969 the amount of the fee.” F.2d 1319, 1322 (1st Cir. 1992) (“[section 203(m)] could easily be The criteria for the award to plaintiff’s counsel of their read to require more – for example, notice of ‘the amount… determined by the employer’ to constitute wages….”). 18 Davis, 38 F.Supp.2d at 719. 21 289 F. Supp. 2d 1042 (N.D. Ill. 2003). 19 29 CFR §§ 531.59(b), 531.54. 22 29 U.S.C. § 216(b). 20 Id. 23 Uphoff v. Elegant Bath, Ltd., 176 F.3d 399 (7th Cir. 1999).

APRIL 2012 25 fees, from the defendant, include: (1) Evidence that the client or the circumstances; (11) the experience, reputa- plaintiff has, in some measure, prevailed; (2) Calculation tion, and ability of the attorneys; (12) the undesirability of of the “lodestar” (hourly rate times hours) as the base of the case; and (13) the nature and length of the professional the determination; (3) Other criteria applied by the court relationship with the client. The most important factor to to determine the final fee award.24 consider is the degree of success obtained.30 In order for a party to obtain “prevailing party” status, “Even if plaintiff is a prevailing party, the district court there must be some alteration in the legal relationship be- may deny attorney’s fees – on the ground that no amount tween or among the parties that arises from judicial impri- of fees would be reasonable – if plaintiff’s recovery is mere- matur.25 In plainer English, the court must affirmatively ly technical or de minimis.”31 Recoveries deemed de mini- weigh in on the case by, for example, entering a judgment mis include awards of nominal damages, however awards against a party. Settlement may also give rise to “prevailing of actual or compensatory damages – however small – are party” status. not de minimis. The most useful starting point for determining the Compliance Checklist. In order to simply avoid the amount of a reasonable award of attorneys’ fees under Hook (cost of attorney’s fees) in the Bait (settlement or fee-shifting statutes, such as the FLSA, is calculated by trial), restaurants who engage “tipped” employees may multiplying the number of hours reasonably expended on consider the following as a part of the internal audit: (1) the litigation by a reasonable hourly rate.26 This calcu- Each employee receives, and signs for, a company policy/ lation, referred to as the “lodestar” figure, is intended to handbook which includes a clearly highlighted notice that provide an “objective basis” by which to value a lawyer’s the restaurant is taking a credit against the minimum wage services. The lodestar figure is the presumptively reason- for the tips the employee will receive. A copy of section able fee.27 However, the Supreme Court stated, “[i]f…a 203(m) from the statute should be attached. (2) A notice plaintiff has achieved only partial or limited success, the from the Dept. of Labor (as required by local law) is posted product of hours reasonably expended on the litigation as as to the employees rights under the prevailing Minimum a whole times a reasonable hourly rate may be an excessive Wage Law. (3) A statement in writing is provided about amount.”28 The Supreme Court further stated: your overtime policy, for example, “Overtime is and will There is no precise rule or formula for making [modifi- be discouraged. Scheduling is management’s responsibility cations to the lodestar figure]. The district court may at- and will be carefully assessed to avoid overtime. However, tempt to identify specific hours that should be eliminated, in the event that you are asked to work overtime, you’ll or it may simply reduce the award to account for the lim- be paid in accordance with the then prevailing law.” (4) A ited success. The court necessarily has discretion in making statement is provided in your policy regarding scheduling, this equitable judgment.29 for example that they will be expected to work from clock- Once the lodestar figure is calculated, the district court in to clock-out; that they will not be paid for time they are has wide latitude to make adjustments to the lodestar figure not scheduled to work. to arrive at a more appropriate award under the particular Conclusion. Avoiding FLSA claims may be difficult in facts and circumstances of each case. There are a number today’s litigious environment, particularly from disgrun- of factors a court may consider: (1) the degree of success tled, terminated employees. On the one hand, having a obtained; (2) the proportionality of fess to damages; (3) simple severance agreement with a Release (one week’s pay, awards in similar cases; (4) the time and labor required; for example) may avoid the issues we’ve outlined here. On (5) the novelty and difficulty of the questions; (6) the skill the other hand, should you find your company on the de- requisite to perform the legal service properly; (7) the pre- fense of such a FLSA claim, having these internal audit clusion of employment by the attorney due to acceptance procedures may go far to protecting the company, and its of the case; (8) the customary fee; (9) whether the fee is owners. □ fixed or contingent; (10) time limitations imposed by the

24 See, e.g., Uphoff, supra. 30 Id. at 433-36. 25 Dionne v. Floormasters Enterprises, Inc., 647 F.3d 1109 (11th 31 Garcia v. R.J.B. Properties, Inc., 756 F.Supp.2d 911, 916 (N.D. Ill. Cir. 2011) (citing Buckhannon Board & Care Home, Inc. v. West 2010) (quoting Fisher v. Kelly, 105 F.3d 350, 352 (7th Cir. 1997)). Virginia Department of Health & Human Resources, 532 U.S. See also Farrar v. Hobby, 506 U.S. 103, 113 S.Ct. 566 (1992) 598, 605-10 (2001)). (“[W]hen a plaintiff’s victory is purely technical or de minimis, 26 Hensley v. Eckerhart, 461 U.S. 424, 433 (1983). a district court need not go through the usual complexities 27 Heder v. City of Two Rivers, 255 F.Supp.2d 947, 953 (E.D. Wis. involved in calculating attorney’s fees…. Instead, it is enough 2003). for a court to explain why the victory is de minimis and 28 Hensley, 461 U.S. at 436. announce a sensible decision to award low fees or no fees at 29 Id. all.”) (O’Connor, J., concurring).

26 Dcba BRIEF

The Law Firm of Momkus McCluskey, LLC has served the DuPage County community for the past twenty years. The firm accepts referrals and co-counsel relationships in the following areas:

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By Michael A. Biederstadt

n 2010, a New York trial court determined that the five albums created, written, and recorded by Bob Marley during his lifetime were not actually owned by Marley. Instead, the District Court determined that the “largest recordI company in the world” was actually the legal “author” of Marley’s music. Throughout history, many musicians have been admired for their ability to bring about change, including Bob Marley. Surprisingly, through litigation that is currently ongoing it may now be a member of the Village People’s turn to pave the way for artists throughout the United States to regain “authorship” of their music and potentially, forever change how courts interpret certain aspects of copyright law. 12Historically, courts have provided unbridled power to 1976 will be limited to material created after January 1, major record companies over their artists based upon the 1978.4 If an artist is lucky enough to fall into this category, common law that has evolved pursuant to the Copyright the age-old power-struggle between the artist and the re- Act of 1909. Yet, as a result of the Copyright Act of 1976, cord company may begin to dramatically swing in favor of the long-standing traditions of our common law may soon our most influential musicians, whose music has the ability change. On January 1, 2013, the floodgates will be opened to endure the test of time. and the entertainment industry in the United States will Copyright Ownership within the Entertainment In- face a phenomenal challenge. Pursuant to §203(a) of the dustry. On September 10, 2010, the United States Dis- Copyright Act of 1976, an individual artist will now be trict Court for the Southern District of New York issued capable of terminating the record companies’ copyright an opinion that denied Bob Marley’s widow and nine of ownership of their music thirty-five years after signing the his children the ability to regain copyright ownership over contract.3 Unfortunately for artists, the protections cre- five albums created by the prolific reggae artist from 1972 ated in support of authorship under the Copyright Act of until his death in 1981.5 In that decision, the Court classified Bob Marley’s creation of said music as works “made 1 Fifty-Six Hope Road Music Ltd. v. UMG Recordings, Inc., No. 08 Civ. 6143 DLC, 2010 WL 3564258 (S.D.N.Y Sept. 10, 2010). 2 Id. at *1 and *11. 4 Id. 3 17 U.S.C.A. §203 (West 2010). 5 Fifty-Six Hope Road Music Ltd., 2010 WL 3564258 at *1.

28 Dcba BRIEF for hire” and determined that Universal Music Group to comprehend the level of success and multi-billions of (UMG) was the statutory author and owner of both the dollars that said material would generate over the next cen- initial and renewal copyrights for each of the five albums tury. Hence, why each of these individuals or their heirs created.6 Due to the fact that each of the recordings were are currently in the process of attempting to terminate copyrighted and published prior to January 1, 1978, the their copyright assignments pursuant to the Copyright Act Copyright Act of 1909 applied and dictated the judicial of 1976 or have recently concluded litigation associated outcome in favor of UMG. 7 therewith. Commencing January 1, 2013, a songwriter, a cartoon- The Copyright Act of 1976.After reviewing the top ist, an author, or other artist of a creative work, who ex- selling albums of the late 1970’s, few would have guessed ecuted an agreement to transfer or the artist to valiantly be leading the grant a copyright license after Janu- Michael Biederstadt public charge to exercise their right ary 1, 1978, may regain ownership is a graduate of Val- to terminate their copyright license and control of their copyright, re- paraiso University based upon the fast-approaching gardless of the deal they may have date of January 1, 2013. Yet, it School of Law and entered into thirty-five years ago.8 turned out to be the original lead received his under- The intent behind such legislation singer of “The Village People.” was to protect the disadvantaged graduate degree Victor Willis (the Cop and oc- artist, who licensed their music, from Loyola Uni- casionally, the Sailor) has filed for character, novel or logo to a cor- versity Chicago. Michael is an associate at termination of his personal grant porate media giant when they were Abear Law Office and his practice is pri- of copyright credit for 33 of the young and unknown, possessed marily concentrated in family law. As an band’s songs, including the hits little to no bargaining power, and avid music lover and someone who has “Y.M.C.A.,” “Macho Man,” and may have simply been ecstatic to dabbled in entertainment law throughout “In the Navy.”12 Although it is pub- receive any compensation whatso- his career, Michael continues to pursue his licly known that many artists from ever to pursue their dream. interest in the field of entertainment law. the late 70’s and early 80’s have Consider the deal struck in 1938 filed the required notice of termi- when two young men from Cleve- nation pursuant to the Copyright land, Ohio, Jerome Siegel and Joseph Schuster, signed Act of 1976, none have received as much media-attention over all of their rights to the character of Superman for as the Village People’s front man. The litigation resulting $130.9 After taking into account the astronomical amount from Willis’ attempt to terminate is quickly bringing the of money generated from decades of comic sales, movies, looming issue surrounding the Copyright Act of 1976 into video games, toys, clothes, costumes, parade floats and cor- the spotlight. porate licensing, no one can reasonably argue that $130 The Honorable Judge Barry Moskowitz, who is oversee- was reasonable compensation for this character. Likewise, ing Willis’ case, acknowledges that this is one of the first consider the unbelievable contribution of Jack Kirby to cases regarding the termination of copyright grants to be our current string of CGI summer box-office blockbusters. litigated in Federal Courts.13 As a result, the Court has Kirby is credited as a co-author and creator of the original taken an unconventional approach in permitting amicus comic book characters “The Fantastic Four,” “Spiderman,” briefs from the Songwriters Guild of America and various “X-men,” “The Incredible Hulk,” and “Thor.”10 In addi- other associations at a very early stage in the litigation.14 tion, when John Steinbeck sold the publishing rights to Termination Provisions of Section 203. Section “The Grapes of Wrath” and “Of Mice and Men,” could 203(a) of the Copyright Act of 1976 provides, “In the case he have contemplated the long-term success and influence 11 that these novels would have upon American society? It 12 Larry Rohter, A Village Person Tests the Copyright Law, The is undeniable that each of these artists and authors failed New York Times, August 16, 2011., at http://www.nytimes. com/2011/08/17/arts/music/village-people-singer-claims- rights-to-ymca.html?pagewanted=all. 6 Id. at *11. 13 Eriq Gardner, Judge in “Y.M.C.A.” Copyright Termination Battle 7 Id. at *1, *7. Asks to Hear More Information, The Hollywood Reporter, 8 17 U.S.C.A. §203. December 19, 2011, at http://www.hollywoodreporter.com/ 9 Siegel v. Warner Bros. Entertainment Inc., 658 F.Supp.2d 1036 thr-esq/ymca-village-people-lawsuit-judge-copyright-275293. (C.D.Cal. 2009). 14 “The Songwriters Guild of America asked for permission 10 Marvel Worldwide, Inc. v. Kirby, 777 F.Supp.2d 720 (S.D.N.Y. to submit an amicus brief that argued that recipients of 2011). termination notices shouldn’t be permitted to engage in 11 Penguin Group (USA) Inc. v. Steinbeck, 537 F.3d 193 (2nd Cir. protracted litigation and legal gamesmanship to block the 2008). effect of clearly meritorious termination claims by creators.” Id.

APRIL 2012 29 of any work other than a work made for hire, the exclusive of termination.19 Termination of the grant may be effected or nonexclusive grant of a transfer or license of copyright notwithstanding any agreement to the contrary, including or of any right under a copyright, executed by the author an agreement to make a will or to make any future grant.20 on or after January 1, 1978, otherwise than by will, is sub- Work Made for Hire. The definition of a “Work Made ject to termination under certain conditions.15 In the case for Hire” is at the center of the controversy over copyright of a grant executed by one author, termination of the grant termination. Under Section 101 of the Copyright Act of may be effected by that author or their heirs. In the case of 1976, a “work made for hire” is defined as “(1) a work a grant executed by two or more authors of a joint work, prepared by an employee within the scope of his or her termination may be effected by a majority of the authors employment (2) a work specially ordered or commissioned who executed it.16 Termination of the grant may be ef- for use as a contribution to a collective work: as a part of a fected at any time during a period of five years beginning motion picture or other audiovisual work, as a translation, at the end of thir- as a supplemen- ty-five years from tary work, as a the date of execu- compilation, as tion of the grant; On January 1, 2013, the floodgates an instructional or, if the grant text, as a test, covers the right will be opened and the entertainment as answer mate- of publication of rial for a test, or the work, the pe- industry in the United States will face a as an atlas; if the riod begins at the parties expressly end of thirty-five phenomenal challenge. agree in a writ- years from the ten instrument date of publica- signed by them tion of the work under the grant or at the end of the forty that the work shall be considered a work made for hire. . years from the date of execution of the grant, whichever . .”21 If the copyrighted material is deemed to be a “work term ends earlier.17 made for hire,” then the legal “author” of that material is As a result of sections 203, January 1, 2013 has become the employer and not the artist for all copyright purposes. the focal point associated with termination rights governed Termination rights are specifically exempted from a work by the Copyright Act of 1976. In the event that artists ex- that is deemed to be a “work made for hire” and the em- ecuted a copyright transfer or grant with a record label on ployer will retain all copyright ownership of what is created January 1, 1978 (the first eligible date for protection under by their employees. the Copyright Act of 1976), they are entitled to effectively From the major record labels’ perspective, they have ex- terminate that copyright transfer or grant on January 1, clusive ownership and recording rights to music that is cre- 2013, which is thirty-five years after executing the grant, ated by the artist. The courts have traditionally supported provided that they have fulfilled all of the statutory notice the major labels’ position and justified their decisions by requirements. finding that the labels as “employers” have the ability to However, the Act provides additional requirements be- control when and where an artist records; they have in- yond the passage of time. The termination shall be ef- vested all of the capitol to create, publish and market the fected by serving an advance notice in writing, signed by music that is created; and they have the right to object to the number and proportion of required owners of termi- certain lyrics or decline publishing any song or album that nation interests, or by their duly authorized agents, upon may be submitted by the artist. Therefore, it is the posi- the grantee or the grantees successor in title.18 The notice tion of the RIAA and all major record labels that they are must state the effective date of termination and the notice in a position to contractually deem themselves to be the shall be served not less than two or more than ten years author of music created by the artists on their label. By before the date termination. A copy of the notice shall be virtue of the terms of their contractual relationship, the recorded in the Copyright Office before the effective date artists have historically been deemed to be employees of the label. As a result, the master recordings created by

15 17 U.S.C.A. § 203 (2010). 16 Id. at § 203(a)(1). 19 Id. 17 Id. at § 203(a)(3). 20 Id. at § 203(a)(5). 18 Id. at § 203(a)(4). 21 Id. at § 101.

30 Dcba BRIEF the label during the term of the recording contract then which the work is carried out (even if the employer does belong to the company in perpetuity. not direct or supervise its creation) in order to attain work- Where the System Failed the Marley’s, the Village’s for-hire status. The Second Circuit acknowledged in this Cop May Triumph. Over the course of the past centu- holding “that its jurisprudence concerning the status of ry, application of copyright law within the United States commissioned works under the 1909 Act has created an has supported the record companies in defining a “work almost irrebuttable presumption that any person who paid made for hire.” The well established common law con- another to create a copyrightable work was the statutory cerning copyright “authorship” is clearly laid out in the author under the work for hire doctrine.”29 case of Fifty-Six Hope Road Music Ltd., v. UMG Recordings, Although the court’s decision was correct under the Inc.22 This decision, discussed in brief at the beginning of Copyright Act of 1909, the reasoning behind the Second this article, centered around the definition of an “author” Circuit’s decision is not consistent with the intent clearly and a “work made for hire” in determining whether the set forth in the Copyright Act of 1976. Bob Marley is an heirs of Bob Marley were entitled to claim ownership of independent contractor in the most general sense of an the renewal term copyrights in Bob Marley’s recordings by independent contractor, as opposed to an employee. Bob virtue of reversion after Bob Marley’s death. The Court Marley is the “author” of his artistic musical creations. Re- determined that Universal Music Group (UMG), as the gardless, UMG properly renewed their grant of copyright successor-in-interest of Island Records, is the statutory au- after twenty-eight years and as a result, UMG will retain thor and owner of the initial and renewal term copyrights copyright ownership until another termination period of said music.23 Universal Music Group argued that based should arise. Pursuant to §304(c) of the Copyright Act of upon the executed recording agreements, Marley’s records 1976, the Marley family will be entitled to seek termina- were “works made for hire” and that they are therefore tion of the copyright grant to UMG fifty-six years after it entitled to the financial rewards copyright law tradition- was originally secured, which will occur in 2028.30 ally grants upon corporations to encourage such efforts.24 Conclusion. The arguments in the Marley decision The heirs of Bob Marley argued that the recordings were and the pending litigation involving Victor Willis of the not traditional commissioned works and therefore, should Village People are eerily similar. Counsel for each of the not be considered “works made for hire.” 25 Further, Bob record companies argue that termination rights do not ap- Marley’s heirs argued that he would have created his music ply to the disputed sound recordings because the master even if he had not entered into a contractual agreement recordings belong to the record companies in perpetuity with Island Records. as they were “works made for hire” and the company is In making its decision, the Southern District of New the “author” for copyright purposes. Further, the Village York’s District Court determined that because the record- People were a concept group formed and created by the ings in dispute were recorded prior to January 1, 1978, record company. The record company controlled what, they are governed by the 1909 Act.26 Under the 1909 Act, when, and where the group recorded. So in turn, from the the work made for hire definition of §101 of the Copyright record company’s perspective, the master recordings were Act of 1976 does not strictly apply. If a work is determined “works made for hire,” with the label as the statutory au- to be a “work made for hire,” the employer is legally re- thor, and not subject to termination rights. garded as the “author,” and the creator of the work is not.27 The Copyright Act of 1976 may be the linchpin to a In making its determination, the court applied the Second new approach in defining and understanding copyright Circuit’s common-law “Instance and Expense Test.”28 On law. The distinction of an employee and an independent its face, that test does not consider whether the work was contractor within the entertainment industry will no lon- created by a traditional “employee” or an “independent ger be grounded in common law and subject to the “In- contractor.” Under the “Instance and Expense Test,” an stance and Expense Test.” Instead Federal Courts will need employer merely needs to induce the creation of the work to establish a sound foundation to justify the decisions and possess the right to direct and supervise the manner in that will be made concerning termination rights under the Copyright Act of 1976. Victor Willis’ case may lead to 22 Fifty-Six Hope Road Music Ltd., 2010 WL 3564258. precedent that re-defines the definition of a “work made 23 Id. at *11. for hire” or joint authorship and effectively change the way 24 Id. at *6. our legal system views various nuances of copyright law. □ 25 Id. at *9. 26 Id. at *7. 27 Id. 29 Id. at *8. 28 Id. 30 17 U.S.C.A. §304.

APRIL 2012 31 A Requirement of Life Insurance to Secure a Maintenance Award Allowable Under New Law

By Victoria C. Kelly and Leah D. Setzen

an a client’s maintenance award be secured by life insurance policy, in order to ensure that a spouse receiving maintenance obtains the full benefit of the maintenance obligation? Public Act 097-0608, effec- Ctive January 1, 2012, amended four sections of the Illinois Marriage and Dis- solution of Marriage Act (“IMDMA”) to, among other things, allow a court to require a party to obtain or maintain life insurance to secure an award of maintenance. This article will first look how the case law developed before the PA 097-0608 and then discuss the changes under the new law. Background. Several appellate court rulings highlight section nor any other section of the Act explicitly provides the varying past interpretations of the Illinois Marriage that a court may order the spouse paying maintenance to and Dissolution of Marriage Act (“IMDMA”) as to the designate the recipient spouse as the beneficiary of a life issue of ordering life insurance as security for support pay- insurance policy as security for the maintenance payment.3 ments. In the Third District case of In Re the Marriage of In further support of its opinion that the IMDMA did Ellinger, the appellate court found the trial court lacked not allow courts discretion in securing support payments authority under the IMDMA to order a party to obtain life through life insurance, the Third District looked at the dif- insurance to secure a maintenance obligation.1 In Ellinger, ferences in language between maintenance termination in the trial court required husband to pay wife monthly Section 5/510(c) of the Act versus the termination of child maintenance and the court ordered that he maintain her as support under Section 510(d). Section 510(c) states, “Un- the sole beneficiary of his life insurance policy for so long less otherwise agreed by the parties in a written agreement as he shall have an obligation to pay her maintenance.2 set forth in the judgment or otherwise approved by the On appeal, the Third District observed that while Section court, the obligation to pay future maintenance is termi- 504 of the IMDMA authorizes a trial court to order one nated by the death of either party.”4 In contrast, Section spouse to pay maintenance to another spouse, neither that 510(d) provides, “provisions for the support of a child are”

1 In re Marriage of Ellinger, 378 Ill.App.3d 497, 882 N.E.2d 692 (3d Dist. 2008) 3 Id. at 500, 882 N.E.2d at 814. 2 Id. at 498, 882 N.E.2d at 813. 4 750 ILCS 5/510(c)

32 Dcba BRIEF not terminated “by the death of a parent obligated to sup- DMA with respect to life insurance as security for main- port or educate the child.”5 Based upon these and other tenance payments culminated in In Re the Marriage of differences in language under the Act as to the treatment Walker,12 which created an official split between the Third of child support payments compared to maintenance pay- and Fourth District and laid the groundwork for the new ments, the appellate court found that the trial court erred amendments to the Act contained in Public Act 097-0608. as a matter of law by analogizing the use of life insurance to In Walker, the court ordered husband to maintain life in- secure child support payments with its use to secure main- surance naming wife as the sole beneficiary to secure the tenance payments. award of maintenance.13 On ap- Further, in In re the Marriage peal, husband argued that the trial 6 of Clarke, a Fourth District case, Victoria C. Kelly court erred in requiring him to the court held that a court does not is an associate with maintain a policy of insurance to have authority to order a spouse the family law secure the maintenance payment 14 or the estate of a spouse to make firm of Grunyk & in the event of his death. maintenance payments for a period In abrogating its prior hold- Associates, P.C. extending beyond the death of that ings, the Fourth District in Walker in Naperville, spouse or to require that spouse to stated that while the Act does not secure his maintenance obligation Illinois. She re- contain language specifically au- to the other spouse after his death.7 ceived her Bachelor thorizing a trial court to order se- The Clarke court observed that of Science Degree in Summa cum curity for maintenance, the legis- when the IMDMA was enacted, it laude from the Quincy University in lature did not specifically prohibit replaced earlier legislation that gave 2005, and her Juris Doctorate from such an order.15 The Walker court a trial court discretion to designate Northern Illinois University in 2008. also determined that ordering a life insurance as security for main- life insurance policy as security for tenance obligations.8 The appellate maintenance does not equate to court reasoned that the omission of Leah D. Setzen is payment after death but rather is a such a provision in the Act demon- an associate with guard against premature death and strated the intent of the legislature the family law therefore, the court would not pre- to change the law in this regard. firm of Grunyk & sume that the trial court violated However, years later, the Fourth Associates, P.C. the Act’s requirement that the ob- District again addressed the issue of in Naperville, ligation to terminate maintenance providing security for maintenance terminate upon the death of either Illinois. She re- obligations in In Re the Marriage party.16 The First, Second, and ceived her Bachelor of Vernon.9 In the Vernon case, the Fifth Districts also held similarly of Arts Degree in Summa cum laude and trial court held that that husband with respect to ordering life insur- was to pay maintenance to wife Phi Beta Kappa from the University of ance to secure a maintenance obli- and ordered him to keep his wife Illinois in 1997, and her Juris Doctorate gation. as a beneficiary on his life insur- from the University of Illinois in 2000, New Law. Public Act 097-0608, ance policy.10 On appeal, husband where she graduated cum laude. which took effect January 1, 2012, argued that the court improperly amended four sections of the Illi- ordered him to maintain his wife as nois Marriage and Dissolution of beneficiary on his life insurance policy.11 The Fourth Dis- Marriage Act (“IMDMA”): Section 503 - Disposition of trict questioned the holding in Clarke, relying on the IM- property; Section 504 - Maintenance; Section 505 - Child DMA’s own direction that the Act be “liberally construed” support; and Section 510 - Modification and termination to make reasonable provisions for spouses and children. of provisions for maintenance, support, educational ex- The Fourth District’s evolving interpretation of the IM- penses, and property disposition. The amendments now provide that a maintenance award ordered by a court may 5 750 ILCS 5/510(d) 6 In re the Marriage of Clarke, 125 Ill.App.3d 432, 465 N.E.2d 975 (4thd D 1984) 12 In re Marriage of Walker, 386 Ill.App.3d 1034, 899 N.E.2d 1097 7 Id. at 434, 465 N.E. 2d 975 at 976. (4th Dist. 2008) 8 Clarke, at 437, 465 N.E.2d 975 at 978. 13 Walker, at 1036, 899 N.E.2d 1097 at 1099. 9 In Re the Marriage of Vernon, 253 Ill.App.3d 783, 625 N.E.2d 823 14 Id. at 1045, 899 N.E.2d at 1106. 10 Id. at784, 625 N.E.2 at 825. 15 Id. at 1046, 899 N.E.2d at 1107 11 Id. at 788, 625 N.E.2 at 827. 16 Id. at 1047, 899 N.E.2d at 1108.

APRIL 2012 33 be secured by an existing or new policy of life insurance, to be resolved with respect to the death benefit coverage, and, if applicable, that a judgment for dissolution of mar- the proposed life insurance application for new insurance riage shall expressly set forth that payments for such insur- shall be reviewed in camera so as to protect the privacy of ance are excludable under the Internal Revenue Code from the obligor.20 the gross income of the maintenance payee.17 The final new amendment to 750 ILCS 5/504(f) is that Although courts now have discretion to secure an award unless otherwise stipulated, the death benefits paid under of maintenance with a life insurance policy, this author- the life insurance obtained to secure maintenance under ity is subject to certain limitations. With respect to exist- Section 504(f) of the IMDMA are excludable from the ing life insurance, provided that the court has sufficient gross income of the payee under Section 71(b)(1)(B) of the evidence and makes relative findings, the court may allo- Internal Revenue Code.21 This provision allows the court cate death benefits, the right to assign death benefits or to secure an award of maintenance upon the death of the the obligation for future premium payments between the payor notwithstanding the fact that maintenance termi- parties.18 The court also has the discretion to order a new nates upon the death of the payor or payee.22 Therefore, life insurance policy to be obtained to secure maintenance. practitioners must be aware that when dealing with life However, if the court orders a new life insurance policy, insurance to secure a maintenance obligation, that a final the payor spouse need only cooperate on all appropriate judgment specifically states the aforementioned provision steps for the payee spouse to obtain the policy of life insur- unless the parties agree otherwise. ance; the payee spouse would be responsible for the pay- Further, this new provision has implications for child ment of said premiums.19 Additionally, if an issue needs support. Section 505 of the IMDMA has also been amended to mirror new Section 504(f)(3) and now allows 17 750 ILCS 5/504(f). premiums paid for life insurance to secure child support, 18 750 ILCS 5/504(f)(1) 19 750 ILCS 5/504(f)(2) maintenance, or educational expenses for a non-minor child, to be deducted prior to calculating net income for child support purposes.23 This is important for family law practitioners, who must explain to clients that securing any support obligations with life insurance means those premium amounts will be deducted from the payor’s gross income prior to determining his or her net income for child support purposes. Therefore, like health insurance premiums, life insurance premiums must be taken into account when determining the actual amount of child support that the obligor shall pay. Conclusion. Just as Section 510 of the IMDMA provides certain termination events for the payment of maintenance, that section has been amended to now provide that upon the death of either party or remarriage of the party receiving maintenance, any obligation to maintain life insurance terminates as well.24 So accordingly, while the death benefit will not be affected, an estate of a de- ceased payor will not be obligated to maintain the insurance policy beyond the death of the payor. These changes require the family law attorney to be mindful of proper settlement of a case or proper drafting following a trial where maintenance is awarded or otherwise addressed. □

20 Id. 21 750 ILCS 5/504(f)(3). This article does not comment on, nor make any references to, the Internal Revenue Code, or any issues that may arise from this provision. 22 Id. 23 750 ILCS 5/505(f) 24 750 ILCS 5/510(c)

34 Dcba BRIEF Classifieds

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APRIL 2012 35