River Breeze, LLC v. Granholm

2022 IL App (2d) 210704No. 2-21-0704
Opinion filed December 1, 2022
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
SECOND DISTRICT
______________________________________________________________________________
RIVER BREEZE, LLC, In Its Individual ) Appeal from the Circuit Court
Capacity and Derivatively on Behalf of Aurora ) of Kane County.
Downtown, )
)
Plaintiff-Appellant, )
)
v. ) No. 20-CH-376
)
KIM GRANHOLM, GINA SALAMONE, )
and AURORA DOWNTOWN, ) Honorable
) Kevin T. Busch,
Defendants-Appellees. ) Judge, Presiding.
______________________________________________________________________________
JUSTICE SCHOSTOK delivered the judgment of the court, with opinion.
Presiding Justice Brennan and Justice Hudson concurred in the judgment and opinion.
OPINION
¶1 The plaintiff, River Breeze, LLC, brought suit both on its own behalf and on behalf of
Aurora Downtown, a not-for-profit organization of which it is a member, against the defendants
Kim Granholm and Gina Salamone, who are directors of Aurora Downtown, and against Aurora
Downtown itself. Counts I and II of the amended complaint sought the removal of Granholm and
Salamone from the board pursuant to the General Not for Profit Corporation Act of 1986 (Act)
(805 ILCS 105/108.35 (West 2016)). Count III alleged that Aurora Downtown violated the
Freedom of Information Act (FOIA) (5 ILCS 140/11 (West 2016)). The trial court dismissed the
complaint, and the plaintiff appeals that dismissal. We vacate the trial court’s dismissal and remand
for further proceedings.
2022 IL App (2d) 210704¶2 I. BACKGROUND
¶3 The following facts are drawn largely from the amended complaint’s allegations, which
we accept as true to consider whether the trial court correctly dismissed the complaint. See Bryson
v. News America Publications, Inc., 174 Ill. 2d 77, 86 (1996).
¶4 The City of Aurora created Special Service Area Number One (SSA No. 1), permitting it
to levy taxes on property owners within that area to provide for the economic benefit of the area,
a business district in Aurora. Aurora Downtown is a not-for-profit corporation organized under the
Act. The complaint alleges that “Aurora Downtown was created pursuant to the SSA No. 1 and,
through its elected Board of Directors, *** is charged with utilizing the SSA No. 1 tax revenue in
order to advise the City of Aurora” on combatting community deterioration, improving and
redeveloping the SSA, and aiding businesses within the SSA. The complaint further alleges that
“SSA No. 1 specifically identifies Aurora Downtown as an agency of the City of Aurora,” that
Aurora Downtown has openly acknowledged that it serves as an advisory body to the city, and that
Aurora Downtown derives all of its powers from the city and must seek the city’s approval for its
projects and actions. Aurora Downtown has an appointed FOIA officer to respond to FOIA
requests and has previously responded to such requests. The plaintiff is a limited liability company
that owns three parcels within the SSA. As a property owner of such parcels, the plaintiff is
required to pay special taxes and is a member of Aurora Downtown.
¶5 During the relevant time, Granholm served as a director on the board of Aurora Downtown
and as the board chair. Salamone was another director. The organization’s by-laws required it to
hold an annual meeting and choose directors in December. Although some directors were required
to be drawn from designated organizations (e.g., the public library, the convention and visitors’
bureau), members could nominate and vote upon the other directors. The board chair was charged
with preparing ballots for the election and making them available to members before the annual
-2-
2022 IL App (2d) 210704meeting. Members were required to return their completed ballots to the chair five days before the
annual meeting. Under section 5.8 of the by-laws, the chair could appoint one or more inspectors
to
“ascertain and report the number of votes represented at the meeting, based on their
determination of the validity and effect of proxies; count all votes and report the results;
and do such other acts as are proper to conduct the election and voting with impartiality
and fairness to all the Members.”
The report of the votes and election results was required to be in writing and signed either by the
inspector or, if there was more than one, by a majority of them.
¶6 The plaintiff alleged that, in preparation for the 2017 annual meeting, Granholm prepared
the ballots and distributed them with the instruction that they must be returned by 5 p.m. on
December 1, 2017. Granholm then began counting the ballots in the presence of Salamone and the
manager of Aurora Downtown. Granholm had not formally appointed the latter two as inspectors.
The plaintiff alleged that all three “shared a common hostility towards certain Members” and
“intended to ‘block’ those Members’ nominations [sic] for Director.” Thus, the plaintiff alleged,
the presence of these hostile noninspectors was improper and cast doubt on the integrity of the
election. Granholm later announced the outcome of the election. No certification of the votes was
made.
¶7 On January 31, 2018, Daniel Hites, the sole managing member of the plaintiff, submitted
a FOIA request to Aurora Downtown, seeking—among other things—copies of all nominating
petitions, the ballots (redacted as to all information except the actual vote), the voter signature and
parcel number section of each ballot (redacted as to the actual vote), and all e-mails, letters,
documents, and minutes relating to the 2017 election. In response, Granholm stated that 41 ballots
were counted and 2 rejected, and 35 ballots were unavailable for inspection. Granholm also stated
-3-
2022 IL App (2d) 210704that the ballots were counted by unnamed “appointed inspectors,” although she did not produce
any written report of such inspectors. Granholm included with her response an altered section of
the by-laws that “redacted key portions.” The plaintiff alleged that she did so with the intent to
deceive and to induce the plaintiff to rely on her false representations.
¶8 The plaintiff submitted additional FOIA requests, and Granholm responded to the second
one. No response was made to the third request. Salamone, signing herself as Aurora Downtown’s
FOIA officer, responded to the fourth and fifth requests.
¶9 The plaintiff alleged that the responses to the FOIA requests “revealed additional
irregularities in the 2017 election process.” The complaint alleged that, on information and belief,
Granholm accepted and counted invalid ballots, accepted and counted ballots after the December
1, 2017, deadline, allowed certain members to vote twice, and (either herself or with others) altered
or forged nine ballots. The complaint also alleged that Salamone participated in some or all of
Granholm’s misconduct. This misconduct constituted a breach of Granholm’s and Salamone’s
fiduciary duty as directors, and was “detrimental to Aurora Downtown because it *** damaged
the fairness, impartiality, and integrity of Aurora Downtown’s elections” as well as public
confidence in the city and its agencies. Further, on information and belief, this misconduct had
jeopardized Aurora Downtown’s financing and contract with the city.
¶ 10 Citing section 108.35(d) of the Act, count I sought the removal of Granholm from the
board, and count II sought Salamone’s removal. Section 108.35(d) provides that a circuit court
may remove directors of not-for-profit corporations
“in a proceeding commenced either by the corporation or by members entitled to vote
holding at least 10 percent of the outstanding votes of any class if the courts finds (1) the
director is engaged in fraudulent or dishonest conduct or has grossly abused his or her
-4-
2022 IL App (2d) 210704position to the detriment of the corporation, and (2) removal is in the best interest of the
corporation.” 805 ILCS 105/108.35(d) (West 2016).
Section 108.35(d) further provides that, “[i]f such a proceeding is commenced by a member
entitled to vote, such member shall make the corporation a party defendant.” Id.¶ 11 Count III asserted that Aurora Downtown’s FOIA responses were incomplete and, in some
instances, falsified, which violated FOIA and demonstrated bad faith. The plaintiff sought the
assessment of a statutory civil penalty for this bad faith and to recover its attorney fees and costs.
¶ 12 The defendants filed a combined motion to dismiss the amended complaint pursuant to
section 2-619.1 of the Code of Civil Procedure (Code) (735 ILCS 5/2-619.1 (West 2020)). The
motion argued that, as to counts I and II, the complaint did not state a claim because the allegations
of fraudulent conduct by Granholm and Salamone were insufficiently pled and the complaint did
not adequately plead any actual detriment to Aurora Downtown arising from their conduct. As to
count III, the motion contended that Aurora Downtown could not be considered a “public body”
required to respond to FOIA requests because it was an “independent” body organized as a not-
for-profit corporation under the Act. As relevant here, the motion also argued that the plaintiff was
required to identify the documents it believed the defendants were wrongfully withholding.
¶ 13 The plaintiff responded that, given Granholm’s and Salamone’s fiduciary duties toward
Aurora Downtown and its members, it had adequately pled grounds for their removal under the
Act. It also argued that Aurora Downtown met the legal test to determine whether an organization
is considered a subsidiary “public body” under the Act and disputed that FOIA required the
complaint to identify the documents that the plaintiff believed still had not been produced. In their
reply, the defendants repeated their earlier arguments and added a new argument—that counts I
and II were moot because they alleged wrongdoing only in connection with the 2017 election, but
-5-
2022 IL App (2d) 210704there were three annual board elections since 2017 where Granholm and Salamone were reelected
.
¶ 14 The trial court issued its ruling on November 2, 2021, after hearing oral argument. No
transcript of the hearing is included in the record on appeal, but the order entered that day contains
some of the trial court’s reasoning. Rather than ruling on the arguments raised and briefed by the
parties, the trial court dismissed counts I and II on the basis that the plaintiff lacked standing to
bring those counts because section 108.35 did not permit the plaintiff to bring a derivative claim
on behalf of the members of Aurora Downtown seeking to remove Granholm and Salamone and
the plaintiff had failed to plead that it held at least 10% of the outstanding votes of any class, “as
required by” section 108.35. Although the trial court purported to dismiss counts I and II without
prejudice, the order made clear that the trial court would again dismiss those counts unless the
plaintiff could plead that it held a voting interest equal to 10% of the outstanding votes—a fact
that the plaintiff admitted it could not plead. As to count III, the trial court dismissed it with
prejudice, finding that Aurora Downtown was not a “subsidiary body” of the City of Aurora and
thus was not subject to FOIA. This appeal followed.
¶ 15 II. ANALYSIS
¶ 16 On appeal, the plaintiff argues that the trial court erred in dismissing counts I and II because
the Act does not bar bringing a derivative suit to remove a director and those counts were
sufficiently pled. It also contends that Aurora Downtown is, in fact, a “subsidiary body” subject to
FOIA. Before addressing these arguments, we pause to consider our own jurisdiction to hear this
appeal.
¶ 17 A. Jurisdiction to Review the Dismissal of Counts I and II
¶ 18 Although none of the parties questions our jurisdiction over the issues raised in this appeal,
a reviewing court has a duty to consider sua sponte whether it has jurisdiction and to dismiss an
-6-
2022 IL App (2d) 210704appeal (or a portion of an appeal) if it lacks jurisdiction. Lebron v. Gottlieb Memorial Hospital,
237 Ill. 2d 217, 251-52 (2010). Here, the trial court’s order purported to dismiss counts I and II
“without prejudice,” allowing the plaintiff 28 days to replead those counts. A dismissal without
prejudice generally is not a reviewable final order but rather is an interim order that may become
final if the plaintiff fails to file an amended pleading or if the issue is finally resolved in some other
manner. See In re V.S., 2022 IL App (2d) 210667, ¶ 16. As the plaintiff elected to stand on its
complaint and appeal rather than replead counts I and II, the dismissal became final and we have
jurisdiction to review it. 1 Id.¶ 19 Although the defendants do not dispute our jurisdiction to hear the appeal from the
dismissal of counts I and II, they contend that, because the plaintiff lacked standing under the Act
to seek their removal from the board, the trial court itself lacked the power to hear those claims at
all. This argument borders on the frivolous, as it is based on the concept of limited statutory
jurisdiction, which has been defunct for 20 years. As we noted in Nationstar Mortgage, LLC v.
Canale, 2014 IL App (2d) 130676, ¶ 12, the supreme court rejected this concept in Belleville
Toyota, Inc. v. Toyota Motor Sales, U.S.A., Inc., 199 Ill. 2d 325 (2002). The supreme court
explained that, although this view of limited statutory jurisdiction was correct under the old
1
We note that jurisdiction would also exist because the trial court’s dismissal of counts I
and II is more properly categorized as a dismissal based on an affirmative defense under section
2-619 of the Code (735 ILCS 5/2-619 (West 2020)), not a dismissal for failure to state a claim
I
under section 2-615 of the Code (id. § 2-615). The trial court dismissed counts I and II on the basis
that the plaintiff lacked standing to bring them. Lack of standing to bring an action is an affirmative
defense (Lebron, 237 Ill. 2d at 252), and thus a plaintiff generally need not plead that it has
standing.
-7-
2022 IL App (2d) 210704constitution of 1870, “under our present constitution, ‘[w]ith the exception of the circuit court’s
power to review administrative action, which is conferred by statute, a circuit court’s subject matter
jurisdiction is conferred entirely by our state constitution.’ ” Canale, 2014 IL App (2d) 130676,
¶ 12 (quoting Belleville Toyota, 199 Ill. 2d at 334). Because a circuit court’s jurisdiction now
extends to all “justiciable matters” (Ill. Const. 1970, art. VI, § 9), a complaint need not demonstrate
perfect compliance with all statutory prerequisites; it need only present a justiciable matter.
Canale, 2014 IL App (2d) 130676, ¶¶ 12-15. This justiciability requirement is met so long as “the
alleged claim falls within the general class of cases that the court has the inherent power to hear
and determine.” In re Luis R., 239 Ill. 2d 295, 301 (2010).
¶ 20 Here, there is no dispute that the complaint sought the removal of directors under the Act
or that the trial court had the power to consider and resolve such claims. (The defendants argue
only that the plaintiff was not a proper party to bring such claims.) Thus, the complaint raised a
justiciable matter, and the trial court had jurisdiction over counts I and II. See Canale, 2014 IL
App (2d) 130676, ¶ 18 (foreclosure complaint raised a justiciable matter despite failing to allege
the plaintiff’s interest in the mortgage as required by the foreclosure statute). We therefore reject
the defendants’ argument that the plaintiff’s purported lack of standing under the Act affected the
trial court’s jurisdiction and turn to the substance of that standing issue.
¶ 21 B. Dismissal of Counts I and II—Standing Under the Act
¶ 22 When we review the dismissal of claims, we are guided by certain standards. Although the
defendants’ motion to dismiss raised arguments under both section 2-615 (attacking the sufficiency
of the complaint) and section 2-619 of the Code (raising certain affirmative defenses), the trial
court based its dismissal solely on the latter arguments, finding that affirmative defenses barred
the plaintiff’s claims. Further, on appeal, the defendants do not argue that the allegations of the
complaint were insufficient to state a claim. Thus, we apply the standards for evaluating a dismissal
-8-
2022 IL App (2d) 210704under section 2-619. A section 2-619 motion to dismiss assumes the allegations of the complaint
are true but asserts an affirmative defense or other matter that would defeat the plaintiff’s claim as
a matter of law. 735 ILCS 5/2-619 (West 2020); Nielsen-Massey Vanillas, Inc., v. City of
Waukegan, 276 Ill. App. 3d 146, 151 (1995). Such a motion admits well-pleaded facts but does
not admit conclusions of law and conclusory factual allegations unsupported by allegations of
specific facts alleged in the complaint. Better Government Ass’n v. Illinois High School Ass’n
[IHSA], 2017 IL 121124, ¶ 21. We review the dismissal of a complaint under section 2-619
de novo. Wallace v. Smyth, 203 Ill. 2d 441, 447 (2002).
¶ 23 The issue of whether the plaintiff had standing under the Act to seek the removal of
Granholm and Salamone as directors of Aurora Downtown requires us to interpret that statute. In
construing a statute, our task is to “ascertain and give effect to the legislature’s intent.” Lieb v.
Judges’ Retirement System, 314 Ill. App. 3d 87, 92 (2000). The best indicator of the legislature’s
intent is the plain language of the statute. Lee v. John Deere Insurance Co., 208 Ill. 2d 38, 43
(2003). “When the statute’s language is clear, it will be given effect without resort to other aids of
statutory construction.” Id. “One of the fundamental principles of statutory construction is to view
all provisions of an enactment as a whole,” and thus “words and phrases must be interpreted in
light of other relevant provisions of the statute.” J.S.A. v. M.H., 224 Ill. 2d 182, 197 (2007). “A
court may also consider the reason for the statute, the problems it seeks to remedy, the purposes to
be achieved, and the consequences of interpreting the statute one way or another.” Sperl v. Henry,
2018 IL 123132, ¶ 23.
¶ 24 Under section 108.35(d) of the Act, an action to remove the director of a not-for-profit
corporation may be brought “either by the corporation or by members entitled to vote holding at
least 10 percent of the outstanding votes of any class.” 805 ILCS 105/108.35(d) (West 2016). The
plaintiff concedes that it does not hold at least 10% of the members’ votes, so it may only proceed
-9-
2022 IL App (2d) 210704if it is suing “by the corporation.” The plaintiff posits that, by bringing a derivative suit on behalf
of all the members of Aurora Downtown, it has asserted a claim “by” the corporation. This position
is supported by the common understanding of the term “by,” as one of the definitions of that term
is “on behalf of.” Merriam-Webster Online Dictionary, https://www.merriam-
webster.com/dictionary/by (last visited Nov. 18, 2022) [https://perma.cc/QA5M-VVUJ].
¶ 25 The defendants argue that a derivative action is not an action “by the corporation.”
However, the only authority they cite to support that argument is Goldberg v. Astor Plaza
Condominium Ass’n, 2012 IL App (1st) 110620, ¶ 53, which does not say anything of the kind.
Rather, Goldberg notes that a derivative suit is “ ‘one of the remedies which equity designed for
those situations where the management through fraud, neglect of duty or other cause declines to
take the proper and necessary steps to assert the rights which the corporation has’ ” (id. ¶ 52
(quoting Meyer v. Fleming, 327 U.S. 161, 167 (1946)), and that such a suit is “based upon the
corporate right that was allegedly violated” (id. ¶ 53). Goldberg supports the conclusion that, as
derivative suits are brought on behalf of the corporation to vindicate its rights, they are effectively
suits by the corporation.
¶ 26 The plaintiff’s position is also buttressed by the fact that a different provision of the Act
expressly permits the voting members of not-for-profit corporations to bring derivative suits just
as they were able to do at common law, stating that “[n]othing in this Act shall be construed to
affect any pre-existing common law right of a voting member to bring an action *** in the right
of such corporation.” 805 ILCS 105/107.80 (West 2016). The defendants argue that, by including
language in section 108.35 that members can only seek the removal of directors if they hold more
than 10% of the votes, the legislature meant to preclude members holding fewer votes from
bringing derivative suits to remove directors. Citing the maxim that when there is a conflict
between statutory provisions, the more specific provision should be applied, the defendants argue
- 10 -
2022 IL App (2d) 210704that, although section 107.80 protects members’ general right to bring derivative suits, section
108.35 is a more specific provision that restricts that right—or at least restricts the remedies
available in a derivative suit, which should not include the removal of directors.
¶ 27 This is a misreading of section 108.35. The legislature did not restrict the ability to sue for
removal of directors to only those members holding more than 10% of the votes, it also permitted
such actions to be brought “by the corporation”—a term that, as we have discussed, includes
derivative actions. Thus, the plain language of the statute permits the filing of such actions either
as derivative suits or by members on their own behalf, if the plaintiff members hold more than
10% of the votes. We note that the Business Corporation Act of 1983 has a similar provision stating
that suits to remove corporate directors can be brought either by the corporation or by shareholders
of a corporation holding at least 10% of the outstanding shares of any class. 805 ILCS 5/8.35(b)
(West 2016). While derivative suits by shareholders/members seeking to remove directors are rare,
they exist. See, e.g., Weis v. E.&G. Weis Farms, Inc., 2019 IL App (5th) 108503-U, ¶ 12 (minority
shareholder of for-profit corporation filed action seeking removal of directors, among other relief).
¶ 28 The plaintiff here could not bring suit to remove Granholm and Salamone on its own behalf
because it does not hold 10% of the votes. But nothing in the Act precluded it from filing a
derivative action to remove them. Accordingly, the trial court erred in concluding otherwise. 2
2
We also note that the trial court proceeded unwisely by basing its decision on an issue
that, so far as we can tell, it raised sua sponte at the hearing. Neither party had previously raised
or briefed the issue of whether the Act permits derivative suits to remove directors. Such
excursions into matters not raised or briefed by the parties run the risk of transforming a court from
an arbiter to an advocate (see People v. Rodriguez, 336 Ill. App. 3d 1, 14 (2002)), and may violate
- 11 -
2022 IL App (2d) 210704¶ 29 C. Dismissal of Counts I and II—Mootness
¶ 30 The defendants next argue that, even if the trial court’s determination that the Act did not
permit derivative suits was erroneous, we should uphold the trial court’s dismissal of counts I and
II because those claims are moot. They contend that, because there were three annual board
elections since 2017 as to which the plaintiff alleged no wrongdoing, and Granholm and Salamone
were reelected to the board each time, the claims seeking removal of those directors are moot. The
defendants fail to show that this is so, however.
¶ 31 “An appeal is moot if ‘no actual controversy exists or if events have occurred that make it
impossible for the reviewing court to grant the complaining party effectual relief.’ ” In re Marriage
of Eckersall, 2015 IL 117922, ¶ 9 (quoting In re Marriage of Peters-Farrell, 216 Ill. 2d 287, 291
(2005)). But the defendants have not cited a single legal authority suggesting that the passage of
time, or the fact of reelection in and of itself, makes it impossible for the court to order the removal
of directors pursuant to section 108.35. This lack of reasoned argument or pertinent legal authority
would justify our finding their argument forfeited. Ill. S. Ct. R. 341(h)(7) (eff. Jan. 1, 2016) (where
a party does not offer any argument or meaningful authority in support of that argument, the
argument is forfeited); People ex rel. Illinois Department of Labor v. E.R.H. Enterprises, Inc.,
2013 IL 115106, ¶ 56 (same). Even if it were not forfeited, though, their argument has no merit.
¶ 32 Section 108.35 of the Act provides that a court may order the removal of a board director
if the trial court finds that “(1) the director is engaged in fraudulent or dishonest conduct or has
grossly abused his or her position to the detriment of the corporation, and (2) removal is in the best
the parties’ due process rights to notice and an opportunity to be heard on the issues forming the
basis for decision (see Oak Grove Jubilee Center, Inc. v. City of Genoa, 347 Ill. App. 3d 973, 978-
79 (2004)).
- 12 -
2022 IL App (2d) 210704interest of the corporation.” 805 ILCS 105/108.35(d) (West 2016). Nothing in this section restricts
the court’s power to grant these remedies if the directors were reelected after their alleged
misconduct. Thus, we may not read such a limitation into the Act. J.S.A., 224 Ill. 2d at 197 (“[w]e
will not depart from the plain language of a statute by reading into it exceptions, limitations or
conditions that conflict with the express legislative intent”). Nor does a common-sense reading of
the statute require such a limitation. We can easily imagine that directors could take actions that
were such a betrayal of their fiduciary duties toward the corporation that their continuing fitness
to serve as directors could be justifiably questioned, despite their reelection by members who may
or may not have known of that misconduct.
¶ 33 For all of these reasons, we reject the defendants’ arguments regarding counts I and II. We
vacate the dismissal of counts I and II and remand for further proceedings.
¶ 34 D. Dismissal of Count III—“Subsidiary Body”
¶ 35 The trial court dismissed count III—the plaintiff’s claim that the defendants violated
FOIA—on the basis that Aurora Downtown was not a “subsidiary body” of a public body and thus
was not within the scope of FOIA. But the trial court lacked sufficient evidence at this stage for
this factual finding and its determination was premature. Accordingly, its dismissal of count III
cannot stand.
¶ 36 The legislature enacted FOIA to ensure that “[e]ach public body shall make available to
any person for inspection or copying all public records.” 5 ILCS 140/3(a) (West 2016). As defined
in FOIA, “public body” includes the following categories relevant here: “all legislative, executive,
administrative, or advisory bodies of *** cities *** and all other municipal corporations, boards,
bureaus, committees, or commissions of this State, [and] any subsidiary bodies of any of the
foregoing including but not limited to committees and subcommittees thereof.” Id. § 2(a). The
- 13 -
2022 IL App (2d) 210704plaintiff does not contend that Aurora Downtown falls within one of the enumerated bodies of
government, instead asserting that it is a “subsidiary body” of the City of Aurora.
¶ 37 A “subsidiary body” may be either public or private. Our supreme court has adopted the
following factors for determining whether a private entity is a “subsidiary body”: “(1) the extent
to which the entity has a legal existence independent of government resolution, (2) the degree of
government control exerted over the entity, (3) the extent to which the entity is publicly funded,
and (4) the nature of the functions performed by the entity.” IHSA, 2017 IL 121124, ¶ 26. The
supreme court continued, “We emphasize that no single factor is determinative or conclusive, but
as the definition indicates, the key distinguishing factors are government creation and control.” Id.¶ 38 The determination of whether a particular organization is a subsidiary body turns on the
evidence presented with respect to each factor. See id. ¶ 34 (“whether a private entity could be
deemed a subsidiary body under the FOIA requires a case-by-case consideration” of the four
factors). Such a factual inquiry generally should not be resolved at the pleading stage, where the
facts alleged in the complaint and any affirmative defenses have not yet been proven. This appeal
is an example of the problems created by proceeding in the absence of sufficient evidence.
¶ 39 In its complaint, the plaintiff alleges that “Aurora Downtown was created pursuant to the
SSA No. 1,” a special taxing district created by Aurora city ordinance, and “is charged with
utilizing the SSA No. 1 tax revenue.” The complaint further alleges that
“SSA No. 1 specifically identifies Aurora Downtown as an agency of the City of Aurora,
and at all relevant times Aurora Downtown openly acknowledged it operate[s] as an
advisory body to the City of Aurora with the purpose of implementing the projects of the
City as laid out in the SSA No. 1.”
Finally, the complaint alleges that “Aurora Downtown derives all of its powers from the City of
Aurora, must seek the City’s approval for its projects and endeavors and is ultimately controlled
- 14 -
2022 IL App (2d) 210704by the City.” If proven, these allegations would establish facts supporting the conclusion that
Aurora Downtown is a subsidiary body subject to FOIA.3
¶ 40 The defendants object that the plaintiff “has presented no evidence or ordinance to
demonstrate” that its allegations are true. This misconstrues the plaintiff’s burden at this point,
however. Discovery has not yet occurred in this case. The trial court dismissed the FOIA claim
pursuant to section 2-619 of the Code (735 ILCS 5/2-619 (West 2020)). When considering a
motion to dismiss brought under that section, we must assume that well-pleaded allegations of fact
in the complaint are true, although we do not make the same assumption about conclusions of law
or conclusory factual allegations unsupported by allegations of specific facts alleged in the
complaint. IHSA, 2017 IL 121124, ¶ 21. The complaint here alleges specific facts, however, and
thus—at this pleading stage of the proceedings—we must take them as true, even if the plaintiff
has not presented evidence to back them up. In line with the reality that determining whether a
private body is a subsidiary body under FOIA is fact-dependent, the relevant case law reveals that
far more evidence was considered in those cases than was presented here. See, e.g., id. ¶ 11 (parties
presented not only organization’s governing documents but also detailed affidavit testimony of its
executive director and pertinent previous legal opinions concerning the nature of the organization);
Rushton v. Department of Corrections, 2019 IL 124552 (decided on summary judgment rather
than at the pleading stage); Chicago Tribune v. College of Du Page, 2017 IL App (2d) 160274(same); Board of Regents of the Regency University System v. Reynard, 292 Ill. App. 3d 968 (1997)
(appeal following bench trial); Hopf v. Topcorp, Inc., 256 Ill. App. 3d 887 (1993) (appeal of
summary judgment); Rockford Newspapers, Inc. v. Northern Illinois Council on Alcoholism &
Drug Dependence, 64 Ill. App. 3d 94 (1978) (appeal of summary judgment). Cf. Better
3
Of course, we are not making such a determination here.
- 15 -
2022 IL App (2d) 210704Government Ass’n v. Metropolitan Pier & Exposition Authority, No. 126790 (Ill. Mar. 24, 2021)
(supervisory order) (vacating the appellate court decision and directing the appellate court to
remand the case to the circuit court “to develop the evidentiary record necessary for a fact specific
inquiry” relating to coverage of a document request under FOIA). The trial court erred in
attempting to determine whether Aurora Downtown qualifies as a subsidiary body at the pleading
stage and on the sparse record presented.
¶ 41 The defendants argue that Aurora Downtown has an independent legal identity, as it is a
duly organized private not-for-profit corporation. But this fact alone cannot establish that it is not
a subsidiary body under FOIA. See, e.g., College of Du Page, 2017 IL App (2d) 160274, ¶ 50
(private not-for-profit corporation was performing a governmental function on behalf of a public
body and thus was subject to FOIA). As this fact is not dispositive, it cannot justify the trial court’s
entry of judgment on count III. The defendants also assert that the plaintiff was required to identify
the specific documents to which it was denied access, but they fail to cite any pertinent legal
authority and thus have forfeited this argument. We vacate the dismissal of count III and remand
for further proceedings.
¶ 42 III. CONCLUSION
¶ 43 The judgment of the circuit court of Kane County is vacated and the cause is remanded for
further proceedings consistent with this opinion.
¶ 44 Vacated and remanded.
- 16 -
2022 IL App (2d) 210704River Breeze, LLC v. Granholm, 2022 IL App (2d) 210704Decision Under Review: Appeal from the Circuit Court of Kane County, No. 20-CH-376;
the Hon. Kevin T. Busch, Judge, presiding.
Attorneys Colin W. Anderson, of Anderson & Uddin, P.C., of Aurora, for
for appellant.
Appellant:
Attorneys Elizabeth M. Bartolucci, of O’Hagan Meyer LLC, of Chicago,
for for appellees.
Appellee:
- 17 -