Court Cases

When a homeowner fails to pay property taxes, Illinois counties can offer third-party investors an opportunity to purchase the outstanding tax debt. Most residential owners are given up to 30 months to repay delinquent tax debts and penalties, with interest. Unlike a mortgage foreclosure, where a homeowner can keep the money left over after their debts are paid, tax buyers can confiscate the property and keep the entire value above what was owed for the taxes and related charges. Legal Action Chicago – along with its partners at Guin, Stokes & Evans, LLC and Reed Smith LLP – have brought a lawsuit on behalf of a class of Cook County homeowners to recover this lost equity value. Additional plaintiffs include Chicago-based non-profit organizations Palenque LSNA and the Southwest Organizing Project (SWOP), who serve communities that have been harmed by the County’s failure to promptly, fully compensate those affected by these practices. The lawsuit alleges that the County’s equity seizures, in addition to being discriminatory, violates the constitutional rights of all homeowners who have had their equity seized without just and fair compensation.

A copy of the lawsuit filed in U.S. District Court for the Northern District of Illinois can be found here. The case has been captioned Bell, et al. v. Pappas, et al., Case No. 1:22-cv-07061.

Legal Action filed its first class action lawsuit on behalf of clients Tracey Calhoun and Venancio Orozco, both of whom lost their jobs at the start of the pandemic and fell behind on their car payments. Then, their cars were remotely disabled by Chicago–based Overland Bond & Investment Corporation by activating “kill switches” previously installed by its car dealer partner Car Credit Center. These kill switches prevented the cars from starting and rendered them useless, causing the vehicles to sit idle for years while losing value. State law prohibits such conduct, and deprives consumers of what is often their only mode of transportation, and therefore their only way to sustain jobs that allow them to pay their bills. After Overland Bond disabled the Calhoun’s and Orozco’s vehicles, it sued them for the amount due on the loans – but Legal Action filed counterclaims against Overland Bond and Car Credit Center and has asked a court to allow Calhoun and Orozco to proceed as named plaintiffs in a class action lawsuit against the companies.

For more information, see the proposed class action counterclaims, as well as coverage of the lawsuit in the Chicago Sun-Times. The case is now pending in the Circuit Court of Cook County, under the caption Overland Bond v. Calhoun, et al., Case No. 2021-M1-108114.

When the owner of a mobile home park failed to pay a water bill of more than $850,000, the City of Blue Island threatened to punish the innocent tenants by shutting off their water service three days before Thanksgiving 2023. Legal Action stepped in and convinced the court to enjoin the City from disconnecting the tenants’ water service pending resolution of the lawsuit. The City of Blue Island appealed the Circuit Court’s decision, but was rejected by the Illinois Appellate court.

You can view a copy of the complaint in Hammer v. City of Blue Island here, and a copy of our motion for a preliminary injunction here. You can read the Appellate Court’s decision upholding the Circuit Court’s grant of a preliminary injunction here.

Henry Horner Mothers Guild vs. Chicago Housing Authority is an old case that originated with Legal Aid Chicago (then the Legal Assistance Foundation) and resulted in a consent decree in the 1990s. It involved the failure of CHA to maintain the buildings in the Henry Horner Homes, formerly surrounding the United Center on the west side. The consent decree called for the demolition and re-building of the whole project area – now a mixed income community called West Haven – for the rights of the Horner residents to return to the new community, and for the maintenance of the buildings in the new community.

The long supervision of the relief under the decree is still ongoing. CHA recently moved to terminate the decree, although they have not finished the building of new units. (The last of the construction projects is now contracted for but has not started.) Further, CHA is deeply out of compliance on the maintenance mandates included in the consent decree.  Legal Action Chicago has now appeared in the case to ensure that the consent decree is fully and properly enforced.

In 2023, Legal Action Chicago – working with Community Organizing and Family Issues, represented by the National Consumer Law Center – obtained groundbreaking discount rates for gas utility customers through administrative advocacy in front of the Illinois Commerce Commission. The ICC adopted Legal Action’s/COFI’s proposals for robust discount rates for three Illinois gas utilities (Peoples Gas, North Shore Gas, and Nicor Gas) while also adopting a similar discount rate proposed by the Illinois Attorney General in a fourth case, that of Ameren Illinois Company.

While Peoples, North Shore, and Nicor accepted the ICC’s decision, Ameren has chosen to appeal and is attempting to have the much-needed discount rates ordered by the Commission thrown out. Legal Action/COFI has filed an amicus brief in the Fifth District Appellate Court urging the Court to reject the Company’s arguments and keep the ordered discount rate in place. The stakes are high: as Legal Action/COFI argue in their brief, a decision in Ameren’s favor could risk upending the discount rate programs ordered for the other three gas utilities, which are set to take affect on October 1, 2024.

Read a copy of the brief filed by Legal Action Chicago and Community Organizing and Family Issues here.

Legal Action Chicago has intervened in the ongoing rate proceeding filed by Illinois American Water Company at the Illinois Commerce Commission, after the Company announced plans to request a rate hike that would likely cause a $24 per month per household increase that consumers can scarcely afford. Legal Action Chicago is working to stop or reduce the size of this rate hike, and also to ensure that the Company adopts a meaningfully robust low-income discount rate that actually makes its water and sewer service affordable for those with the greatest need.

Public housing residents typically pay a reduced rent equal to a percentage of their income, but when that percentage falls below a certain amount federal law authorizes CHA to charge a minimum rent of $75 per month. CHA charges more than 1,400 public housing families the minimum rent. Legal Action Chicago, together with lawyers from the National Housing Law Project and McDermott Will & Emery, recently filed a motion in federal court seeking approval of a proposed settlement regarding CHA’s implementation of the hardship exemption to the minimum rent requirement on behalf of a proposed class of CHA public housing residents. As part of the proposed resolution, CHA will provide residents with improved notice of the hardship exemption and provide additional training for property managers. Upon approval of the settlement, CHA will also erase from each resident’s ledger all unpaid minimum rent charges imposed since July 2016, and provide eligible residents with rent credits for minimum rent payments they actually made since April 2020.

For more information, to read the class action complaint and proposed settlement.

• • Aug 5, 2022 Update – Oliver v. CHA Receives Preliminary Approval of Settlement Agreement – In a written order, U.S. District Judge Matthew F. Kennelly of the Northern District of Illinois tentatively approved a settlement agreement designed to ensure that CHA public housing residents are aware that they can seek a hardship exemption if they cannot afford the minimum rent.
  • April 10, 2023 Update – U.S. District Judge Matthew F. Kennelly granted final approval of the parties’ settlement agreement.

In the wake of the economic crisis created by the pandemic, families that had lost their jobs looked to the state for help in the form of unemployment insurance benefits. Unfortunately, the state could not keep up with the number of claims, and families faced long waiting lists and extended periods during which they received no income, driving many into poverty. Legal Action and its advocacy partners prepared a class action lawsuit to address the problem, and the threat of litigation led to productive settlement negotiations. The Department of Employment Security produced concrete and meaningful improvements, including increased staffing to shorten waiting lists and creative troubleshooting techniques to resolve bottlenecks in the system. This progress continued through 2021, and we are continuing our efforts to make further improvements.

Legal Action Chicago represented a group of more than 100 public interest organizations, grassroots community groups, not-for-profits, faith leaders, and elected officials in an amicus brief filed in the First District Appellate Court after a judge in the Circuit Court of Cook County issued an injunction barring votes from being counted on the “Bring Chicago Home” referendum. The referendum proposes to pay for new housing for the unhoused (and related services) by moving Chicago’s real estate transfer tax from a flat 0.75% rate to a new, progressive rate, where sales under $1M will have a lower tax rate and sales of $1M or more will pay more. The Appellate Court ultimately ruled against a building owner group and allowed the referendum to proceed on schedule.

Read the amicus brief in BOMA, et al. v. Chicago Board of Elections, et al., here. Read coverage of the Appellate Court’s decision here.

Illinois law and Chicago’s Welcoming City Ordinance protect the rights of undocumented immigrants in Illinois and limit local law enforcement’s ability to work with U.S. Immigration and Customs Enforcement (ICE). However, this has not stopped LexisNexis Risk Solutions – a data aggregator that claims to have unique data profiles on 276 million Americans – from putting immigrants and activists at risk of harassment and deportation. Pursuant to a lucrative contract with ICE, LexisNexis has provided the agency with access to a massive database of public and private data in order to aid the agency’s enforcement efforts. In support of our partners at Just Futures Law, Legal Action Chicago acted as local counsel to help Chicago-based immigration activists and organizations prosecute a lawsuit against LexisNexis. The lawsuit aimed to permanently end the company’s relationship with ICE, and compensate those who have been harmed by this data-sharing arrangement.

For more information, see the lawsuit filed in the Circuit Court of Cook County, as well as coverage of the lawsuit by the Associated Press and Law360. While a federal judge ultimately dismissed the case, Legal Action Chicago is proud to have helped draw further attention to this critical issue impacting untold numbers of immigrants and immigration activists nationwide.

In the case Grant’s Pass, Oregon v. Johnson, the U.S. Supreme Court took an appeal from an appellate court decision holding that it is a violation of the U.S. Constitution’s Eighth Amendment for municipalities to fine or punish homeless people camping on public land if there is nowhere indoors for them to stay. Legal Action Chicago was among principal drafters of an amicus brief in support of the 9th Circuit’s ruling. Unfortunately, on June 28, 2024, the U.S. Supreme Court reversed the 9th Circuit, holding that Grant’s Pass’ anti-homelessness ordinance did not violate the Eighth Amendment.