Carter-Shields v. Alton Health Institute, 2002 Ill. Lexis 622, Docket No. 90767 (9/18/02). A charitable, not-for-profit health services organization does not fall within the exception to the corporate practice of medicine doctrine. The organization’s employment agreement with a doctor was void and unenforceable. Dr. Carter-Shields signed an employment agreement with Alton Health Institute. AHI is a nonlicensed, general not-for-profit corporation, which has as its charitable mission the delivery of healthcare services to community residents, especially the poor. The employment agreement contained a non-compete clause that prohibited the doctor from practicing within 20 miles of the AHI clinic for two years after she left AHI’s employ. A number of disputes arose between Dr. Carter-Shields and AHI. She resigned her employment and began a practice within 20 miles of AHI. The doctor sought to have the employment agreement declared unenforceable while AHI sought to enforce the non-compete clause.

The supreme court ruled that the corporate practice of medicine doctrine governed the case. That doctrine, which has been recognized by Illinois courts since the 1930s, states that employment of physicians by corporations is illegal. An exception to the prohibition for licensed hospitals was created by the court in 1997. However, the court rejected the argument the exception should be enlarged for charitable, not-for-profit health care providers. The court stated: "Creating an exception to the corporate practice of medicine doctrine based exclusively upon the fact that an entity is nonprofit would not advance the public interest in safeguarding the physician’s professional judgment from lay interference or protecting the public’s general health and welfare."

Lyons v. Ryan, 2002 Ill. Lexis 625, Docket No. 92503 (9/19/02). (1) Taxpayers do not have standing to bring a suit to recover funds and benefits alleged to have been illegally received by a state officer and state employees. (2) Statute that allows citizen lawsuits to recover damages from persons who have defrauded the state is unconstitutional. This case grows from the licenses-for-bribes scandal in the Secretary of State’s office. The Better Government Association, on behalf and for the benefit of the State of Illinois, sued Governor Ryan and his campaign committee, and other employees of the state to impose a constructive trust on funds and benefits they allegedly received illegally. The BGA also sued under section 20-104(b) of the Code of Civil Procedure, which allows citizens lawsuits to recover damages from persons who have defrauded the state if the Attorney General, after notice, fails to file suit or take other action.

The supreme court held that the BGA did not have standing to sue to impose the constructive trust. The court ruled that the state was the real party in interest, and that "[p]laintiffs are bringing this case as a taxpayer derivative action, seeking to enforce on behalf of the state, a cause of action that belongs to the state . . . Where, as here, the state is the real party in interest, individual taxpayers have no standing to bring the cause of action." The court also held that a taxpayer action under section 20-104(b) of the Code of Civil Procedure, where the real party in interest is the state, is unconstitutional. The court ruled that the legislature may not "confer standing upon private citizens to commence and prosecute actions on behalf of the state . . . Section 20-104(b) improperly usurps the powers of the Attorney General and is invalid."

Stroger v. Regional Transportation Authority, 2002 Ill. Lexis 626, Docket No. 92473 (9/19/02). Statute for appointment of RTA board members is constitutional. John Stroger, the Cook County Board President, and a citizen of Chicago sued to have the statute that states the procedures for appointment of Regional Transportation Authority board members declared unconstitutional. They complained that the statute violated the principle of "one person, one vote," and the separation of powers doctrine. The supreme court held that the statute was constitutional.

Under the statute, certain county board members do not have a right to appoint an RTA board member, others do. The court ruled this did not violate the constitutional principle of "one person, one vote." Employing the rational basis test, the court concluded that citizens of the Cook County districts whose county board members do not have a right of appointment "are nonetheless served by those directors on the RTA board who are appointed by other commissioners . . . ."

In 1983, an amendment to the statute took away the appointment power of the Cook County Board President and placed it with County board members. Stroger claimed that the amendment constituted a violation of the separation of powers doctrine. He argued that the amendment deprived him of his "inherent appointment authority." The court rejected that argument, and pointed out that the Illinois Constitution does not "confer on the president of the Cook County board any specific powers." Further, the court stated that "It is well settled that the method of appointment, other than of constitutional officers, is a matter solely within the discretion of the legislative branch."

Marion Hospital Corp. v. Illinois Health Facilities Planning Board, 2002 Ill. Lexis 627, Docket Nos. 91426, 91479 (9/19/02). Appeal of an application approval by the Health Facility Planning Board was moot because the facility already was constructed. Southern Illinois Orthopedic Center filed an application with the Illinois Health Facilities Planning Board to construct a "limited specialty orthopedic ambulatory surgical treatment center" in Herrin, Illinois. Marion Hospital opposed Southern in hearings before the Board. The Board approved Southern’s application in May 1999. Two months later, Marion sought judicial review of the approval. The circuit court confirmed the Board’s decision, and Marion appealed. Meanwhile, Southern proceeded to build its facility. Construction was finished before the appellate court ruled in March 2001. Nevertheless, the appellate court reversed the circuit court’s decision to confirm the Board’s approval. Marion never sought a stay of the Board’s decision in the circuit court, nor of the circuit court’s judgment.

The supreme court held that the question of the propriety of the application approval was moot, and that the appellate court should not have ruled. ". . . [o]nce a capital expenditure is approved by the Board and made by the permit holder, any question concerning the propriety of that expenditure — which is the issue addressed by the permit application process — is moot. The capital expenditure has been made and cannot be undone. That was the case here."