Carpenter v. Exelon Enterprises Company, LLC

State: Illinois

Court: 1st District Appellate

Docket No: 1-09-1222 Rel

Case Date: 03/18/2010

Preview:FOURTH DIVISION March 18, 2010

No. 1-09-1222 TIMOTHY J. CARPENTER, MERVIN G. SCHAEFER, JAMES P. MALONEY, HENRY JACKSON, DAVID REINDL, HENRY C. HESS, DAVID FALLDORF, and JANE P. KOTH, Plaintiffs-Appellees, v. EXELON ENTERPRISES COMPANY, LLC, and EXELON CORPORATION, Defendants-Appellants. )) )) )) )) ) ) ) ) )

Appeal from the Circuit Court of Cook County No. 08 L 006480 Honorable Brigid Mary McGrath, Judge Presiding.

JUSTICE O'MARA FROSSARD delivered the opinion of the court: This matter appears before this court on interlocutory appeal to consider a question certified by the circuit court, pursuant to Supreme Court Rule 308 (155 Ill. 2d R. 308). Plaintiffs, Timothy J. Carpenter, Mervin G. Schaefer, James P. Maloney, Henry Jackson, David Reindl, Henry C. Hess, David Falldorf, and Jane P. Koth, were formerly minority shareholders of InfraSource, Inc., a Delaware corporation (InfraSource). InfraSource's majority and controlling shareholder was defendant Exelon Enterprises Company, LLC, a subsidiary of defendant Exelon Corporation. Both entities were Pennsylvania corporations, with their principal places of business in Illinois, and they are hereinafter referred to as Exelon Corp. or Exelon Enterprises, and/or collectively as "Exelon." In 2003, Exelon divested itself of most of its interest in InfraSource by entering into a merger agreement with a third party and directly

No. 1-09-1222 acquiring InfraSource's remaining business units. As part of this transaction, the minority shareholders each received a pro rata share of the net proceeds of the merger and acquisition of InfraSource's assets. The plaintiffs filed the instant suit against Exelon in 2007, asserting that the defendants abused their position as majority shareholders of InfraSource in such a way that the rights of the minority shareholders were violated and their interests were not fairly represented in the merger and sale transactions. Exelon filed a motion to dismiss this suit on the grounds that it was barred by the three-year statute of limitations contained in the Illinois Securities Law of 1953 (815 ILCS 5/13(D) (West 2008)). The trial court ultimately denied Exelon's motion to dismiss, determining that the Illinois Securities Law limitations period was inapplicable and the plaintiffs' suit was therefore timely filed within the residual five-year limitations period found in section 13

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