McDonald's Corp. v. Levine

439 N.E.2d 475, 108 Ill. App. 3d 732, 64 Ill. Dec. 224, 1982 Ill. App. LEXIS 2697
CourtAppellate Court of Illinois
DecidedSeptember 24, 1982
Docket81-151
StatusPublished
Cited by54 cases

This text of 439 N.E.2d 475 (McDonald's Corp. v. Levine) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McDonald's Corp. v. Levine, 439 N.E.2d 475, 108 Ill. App. 3d 732, 64 Ill. Dec. 224, 1982 Ill. App. LEXIS 2697 (Ill. Ct. App. 1982).

Opinions

JUSTICE LINDBERG

delivered the opinion of the court:

This is an appeal from the dismissal by the circuit court of Du Page County of a six-count complaint brought by McDonald’s Corporation (McDonald’s) and two of its employees, Noel Kaplan and Dean Canterbury. Plaintiffs sought damages from William S. Levine, Gene Himmelstein, and Stephen Haberkorn, McDonald’s franchisees in Arizona and their Illinois attorney, W. Yale Matheson for violation of the Illinois eavesdropping act (Ill. Rev. Stat. 1977, ch. 38, par. 14 — 1 et seq.).

Plaintiffs allege they discovered the eavesdropping and theft of documents from McDonald’s corporate offices in March 1978 when, during discovery being conducted in a proceeding before the Federal District Court for the District of Arizona, tape recordings and documents were produced. The Arizona action, William S. Levine et al. v. McDonald’s Corporation, et al., filed in August 1977, alleged that McDonald’s and 27 other defendants violated the Sherman Antitrust Act, Arizona antitrust laws, and certain trademarks and breached various contractual obligations. Matheson, an Illinois attorney, was one of the attorneys representing plaintiffs in the Arizona action.

The instant complaint alleges that the surreptitious recording of telephone conversations and meetings in violation of the Illinois eavesdropping act occurred in 1976 and 1977. These conversations were among 21 surreptitiously recorded conversations of McDonald’s employees which were made by defendants in Illinois, California, and Arizona during the period of August 1973 to February 1978. Among the conversations recorded was a meeting held in August 1976 attended by Kaplan, Canterbury, Levine, and Haberkorn, a telephone conversation between Kaplan and Himmelstein in November 1976, a telephone call between Kaplan and Haberkorn in February 1977, and a March 1977 telephone conversation between Kaplan and Haberkorn. The complaint alleges that on each occasion the recording was made secretly by defendants without the knowledge or consent of Kaplan, Canterbury, or McDonald’s. In each instance the surreptitious recordings were given to Matheson for his use and publication.

The photocopied documents comprising 386 separate documents constituted a total of 1,088 separate pages. McDonald’s alleges that one-half of the documents were physically stolen from the offices of McDonald’s. McDonald’s alleges that the other half were obtained by covert photocopying of the originals which were located in McDonald’s offices and that the originals were then returned to their place in the files. The documents which were allegedly stolen and secretly photocopied were maintained by McDonald’s in locked file cabinets which, in most cases, were located in secure areas and private offices. Only authorized personnel were permitted access to the documents.

McDonald’s maintains that the stolen documents deal with the corporate business, finances and business relationships, and communications between officers, employees, and attorneys of McDonald’s. Of the 1,088 allegedly stolen documents only 168 pages have any relationship to the instant defendants or to their franchises, and the balance would appear to have no relation to the instant defendants.

In its six-count complaint the plaintiffs alleged the following: Count I alleges that defendants violated the Illinois eavesdropping act (Ill. Rev. Stat. 1977, ch. 38, par. 14 — 1 et seq.), which prohibits the use of any eavesdropping device to hear or record any conversation unless done with the consent of all parties to the conversation. Specifically, Levine, Haberkorn and Himmelstein, each a McDonald’s franchisee operating in Arizona are accused of surreptitiously tape recording the plaintiffs’ meeting and telephone conversations by using concealed tape recorders and telephone devices. After the tape recordings were made, the defendants Levine, Haberkorn and Himmelstein turned them over to Matheson, an Illinois attorney, for his use and publication. The plaintiffs did not discover the existence of the tape recordings and transcripts until early 1978.

Count II alleges that the defendant Matheson violated the eavesdropping act in that he used and divulged the information contained in the tape recordings and transcripts of the recordings when he knew or should have known that the tapes and transcripts were obtained by illegal eavesdropping. The plaintiffs allege the defendants fraudulently concealed their activities of making the recordings and using the contents and they seek compensatory damages, injunctive relief prohibiting further eavesdropping and punitive damages, all as provided for under the eavesdropping act.

Count III alleges that the defendants Levine, Haberkorn and Himmelstein, conspired to steal and did steal from the offices of McDonald’s numerous privileged, secret and confidential documents. The court further alleges that in furtherance of the conspiracy these three defendants conspired with Matheson to turn the stolen documents and copies therof over to Matheson for his use and publication. The plaintiffs allege the defendants agreed and conspired with each other to fraudulently conceal from McDonald’s the fact that they stole and copied the documents. In count IV therefore defendants are charged with receiving, possessing and using the documents stolen from McDonald’s when they knew or should have known the documents were stolen. Counts III and IV seek compensatory damages and punitive damages.

Count VI alleges that the theft and use of privileged communications between McDonald’s and its attorneys violated McDonald’s attorney-client privilege. No appeal is taken from that portion of the circuit court’s order dismissing count V of the complaint alleging a violation of McDonald’s right to privacy.

The issues before us are: (1) whether counts I and II alleging violatlions of the Illinois eavesdropping act are barred by the running of the statute of limitations found in sections 13 and 14 of the Limitations Act (Ill. Rev. Stat. 1977, ch. 83, par. 14 and 15) and if not, whether a violation occurred of the eavesdropping act (Ill. Rev. Stat. 1977, ch. 38, par. 14 — 1 et seq.); (2) whether the circuit court erred in dismissing counts I and II which were the claims of Noel Kaplan and Dean Canterbury, on the basis that as employees of McDonald’s they are not real parties in interest in and action pursuant to a violation of the eavesdropping statute; (3) whether the court erred in dismissing counts III and IV on the ground that they are compulsory counterclaims under the Federal Rules of Civil Procedure; (4) whether the court erred in ruling that the count VI allegations of tortious interference with the attorney-client privilege failed to state a cause of action; and (5) as to defendant Matheson, whether the court’s dismissal of counts II, III, IV, and VI may be sustained on the ground that an attorney has immunity for using or divulging illegally obtained materials in the course of representation of his client in litigation. We affirm the order of the circuit court of Du Page County dismissing counts II, III, IV, and VI, and reverse and remand as to count I.

COUNTS I AND II: LIMITATIONS ISSUE

Defendants argue that the claims in counts I and II alleging violations of the eavesdropping act (Ill. Rev. Stat. 1977, ch. 38, par.

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Bluebook (online)
439 N.E.2d 475, 108 Ill. App. 3d 732, 64 Ill. Dec. 224, 1982 Ill. App. LEXIS 2697, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mcdonalds-corp-v-levine-illappct-1982.