Cori v. Schlafly , 2021 IL App (5th) 200342-U ( 2021 )

NOTICE
2021 IL App (5th) 200342-UNOTICE
Decision filed 11/17/21. The
This order was filed under
text of this decision may be
NO. 5-20-0342 Supreme Court Rule 23 and is
changed or corrected prior to
the filing of a Petition for not precedent except in the
Rehearing or the disposition of IN THE limited circumstances allowed
the same. under Rule 23(e)(1).
APPELLATE COURT OF ILLINOIS
FIFTH DISTRICT
________________________________________________________________________
ANNE SCHLAFLY CORI and EAGLE ) Appeal from the
FORUM, ) Circuit Court of
) Madison County.
Plaintiffs-Appellees, )
)
v. ) No. 16-MR-111
)
JOHN F. SCHLAFLY, ) Honorable
) David W. Dugan,
Defendant-Appellant. ) Judge, presiding.
________________________________________________________________________
JUSTICE CATES delivered the judgment of the court.
Presiding Justice Boie and Justice Welch concurred in the judgment.
ORDER
¶1 Held: The trial court did not abuse its discretion in finding defendant John Schlafly
in indirect civil contempt for failing to comply with provisions of an
amended temporary restraining order that directed him to deliver (a) specific
contacts lists, and (b) Eagle Forum corporate records. The trial court’s order
finding John Schlafly in statutory contempt for filing an affidavit in bad faith
was not immediately appealable under Supreme Court Rule 304(b)(5) where
the contempt order did not impose a penalty. The appellate court lacked
jurisdiction under Supreme Court Rule 304 to consider Eagle Forum’s cross-
appeal in the absence of a Rule 304(a) finding.
¶2 Defendant John F. Schlafly appeals from orders of the trial court finding him in
indirect civil contempt for failure to comply with provisions in a temporary restraining order
and in statutory contempt for filing an affidavit in bad faith and for purposes of delay. For
1
the reasons that follow, the appeal from the order finding John Schlafly in statutory civil
contempt is dismissed for lack of appellate jurisdiction under Illinois Supreme Court Rule
304(b)(5) (eff. Mar. 8, 2016), and the order finding John Schlafly in indirect civil contempt
is affirmed in part and vacated in part. Eagle Forum’s cross-appeal is dismissed for lack of
appellate jurisdiction under Illinois Supreme Court Rule 304(a) (eff. Mar. 8, 2016).
¶3 I. BACKGROUND
¶4 This case arose out of a dispute over the ownership and control of the assets of Eagle
Forum. Eagle Forum is a not-for-profit, tax-exempt organization under § 501(c)(4) of the
Internal Revenue Code (26 U.S.C. § 501(c)(4) (2016)). It was founded by Phyllis Schlafly
to advance conservative causes. The first four years of this litigation have been contentious,
and the record on appeal is lengthy, containing over 25,000 pages. This appeal is limited
to the propriety of the trial court’s rulings on motions for indirect civil contempt against
defendant John F. Schlafly. A discussion of the facts and procedural history are centered
on those rulings.
¶5 When this litigation commenced in 2016, the plaintiffs, Anne Schlafly Cori (Cori),
Eunie Smith, Cathie Adams, Carolyn McLarty, Rosina Kovar, and Shirley Curry, were
serving as Directors of Eagle Forum. 1 Defendant John F. Schlafly (John) was the Treasurer
and a Director of Eagle Forum. Defendant Edward R. Martin Jr. (Martin)2 was the
President of Eagle Forum. Martin was also the President of the Eagle Forum Education and
1
These plaintiffs, collectively, are also referred to as the “Majority Directors.”
2
For clarity, we refer to Anne Schlafly Cori as “Cori,” John F. Schlafly as “John,” and Edward
Martin Jr. as “Martin” throughout this disposition.
2
Legal Defense Fund (EFELDF). 3 Phyllis Schlafly, a nonparty, served as a Director,
Chairman, and Chief Executive Officer of Eagle Forum until her death on September 5,
2016.
¶6 A. The Rift in Eagle Forum’s Leadership
¶7 According to the allegations in the original complaint, Martin was elected as
President of Eagle Forum on January 31, 2015. During Martin’s tenure as President,
discord developed among Eagle Forum’s national organization, its state affiliates, and its
membership base, and a rift arose within the leadership of Eagle Forum. On March 29,
2016, Cathie Adams, Shirley Curry, and Eunie Smith mailed a notice to all of the directors
of Eagle Forum, advising them that a meeting would be held by teleconference on April
11, 2016.
¶8 On April 9, 2016, Martin emailed more than 41,000 individuals, using a “contacts
list” that Eagle Forum often used for its mass mailings. In the email, Martin claimed that
six directors of Eagle Forum were going to hold a “rogue meeting.” He implored the email
recipients to urge those directors not to “hijack” Eagle Forum for their own purposes. That
same day, the plaintiffs received a letter, ostensibly from Phyllis Schlafly, asking them to
resign their positions immediately. On April 10, 2016, the plaintiffs received a letter from
the Runnymede Law Group. Runnymede stated that it had been retained as legal counsel
3
Eagle Forum Education and Legal Defense Fund is a not-for-profit, tax-exempt entity under
§ 501(c)(3) of the United States Code (26 U.S.C. § 501(c)(3) (2016)). This organization was referred to as
“EFELDF” in the trial court and that designation will be retained in this disposition for consistency.
3
for Eagle Forum, and it directed the plaintiffs to stop acting in violation of their fiduciary
duties to Eagle Forum.
¶9 On April 11, 2016, the Eagle Forum Board of Directors met via teleconference. The
plaintiffs were on the call. Phyllis Schlafly and John were also present, but the other three
directors, Andy Schlafly, Kathleen Sullivan, and LaNeil Wright Spivy, were absent. Martin
was also on the call. According to the Eagle Forum Bylaws, the presence of 6 of the 11
directors constituted a quorum. When the Board moved into executive session, Martin was
not allowed to participate because he was not a director. During the executive session, a
majority of the Board members approved a motion to immediately terminate Martin as
President of Eagle Forum. The majority members also approved motions to terminate the
Runnymede Law Group as legal counsel for Eagle Forum, revoke all signatories on Eagle
Forum financial accounts, and conduct an audit of Eagle Forum assets. All motions passed
by a margin of 6-2, with the plaintiffs voting in favor of each motion, and John and Phyllis
Schlafly objecting to and opposing each motion. Immediately after the Board meeting,
Runnymede Law Group was notified that it no longer represented Eagle Forum, and Martin
and the Eagle Forum staff were notified that Martin had been terminated from his role as
President of Eagle Forum.
¶ 10 On April 22, 2016, the plaintiffs filed a verified complaint against defendants John,
Martin, and Eagle Forum. 4 The plaintiffs alleged that John and Martin refused to
4
Eagle Forum was sued as a nominal defendant. Eagle Forum was later realigned as a party plaintiff
and was given leave to file its own complaint in this action. Eagle Forum Education and Legal Defense
Fund, Eagle Trust Fund, Phyllis Schlafly’s American Eagles, the Estate of Phyllis Schlafly, Andrew
Schlafly, Bruce Schlafly, and Kathleen Sullivan were added as party defendants.
4
acknowledge Martin’s termination as President of Eagle Forum, and that John and Martin
prevented the plaintiffs from gaining access to Eagle Forum documents, financial accounts,
contact lists, websites, and related passwords. The plaintiffs further alleged that Martin
used Eagle Forum social media accounts to disseminate disinformation about the April 11,
2016, meeting of the Eagle Forum Board of Directors. The plaintiffs claimed that
defendants’ actions harmed the name and reputation of Eagle Forum.
¶ 11 The complaint contained counts alleging that John and Martin breached their
fiduciary duties to Eagle Forum, its members, donors, and officers (counts I and II), and
colluded to prevent the Majority Directors from fulfilling their fiduciary duties to Eagle
Forum (count III). The complaint also contained a count for accounting of Eagle Forum’s
property (count IV) and a count for a judgment declaring that the April 11, 2016, meeting
of the Eagle Forum Board of Directors was properly noticed and that all motions approved
during the meeting were valid and lawful (count V). Finally, the plaintiffs sought to enjoin
John and Martin from interfering with the plaintiffs’ efforts to perform their obligations to
Eagle Forum (count VI).
¶ 12 John and Martin filed an answer and denied the main allegations of the plaintiffs’
complaint. They also filed affirmative defenses, asserting that the April 11, 2016, meeting
of the Eagle Forum Board violated the organization’s bylaws and that any actions taken by
the Majority Directors were ultra vires and a breach of their fiduciary duties. Martin and
John also filed a counterclaim seeking declaratory and injunctive relief.
¶ 13 B. The Amended TRO and Contempt Proceedings
5
¶ 14 On April 25, 2016, the plaintiffs filed a motion for a temporary restraining order
against John and Martin. Following a hearing on April 29, 2016, the trial court issued a
temporary restraining order (TRO). The TRO was issued to restrain John and Martin from
blocking the plaintiffs’ access to “the Illinois Headquarters and any and all property of
Eagle Forum 501(c)(4) located thereon or elsewhere.” The court also revoked all prior
signatories on Eagle Forum accounts. The court placed signatory authority for those
accounts with Cori, Smith, and Phyllis Schlafly, and required all three to sign any
instrument of deposit or withdrawal.
¶ 15 On September 29, 2016, the plaintiffs filed an emergency motion to amend the TRO.
The plaintiffs claimed that changes had been made to content on Eagle Forum’s website
and that the registered owner of Eagle Forum’s domain name had been changed without
their authorization. While awaiting a hearing date, the plaintiffs filed a supplemental
pleading alleging that John and Martin continued to deny the plaintiffs access to Eagle
Forum property, and thereby threatened the status quo.
¶ 16 Following a hearing on October 20, 2016, the trial court issued an amended
temporary restraining order (Amended TRO). The court found that John and Martin
continued to deny the plaintiffs access to the property and assets of Eagle Forum, including
membership lists, mailing lists, and databases or other lists used by Eagle Forum for mass
mailings, emails, and robocalls. The court also found that John and Martin made changes
to the content on the Eagle Forum website and changed the registered owner of Eagle
Forum’s domain name to Eagle Trust Fund, and then to Roger Schlafly, without the
knowledge or authorization of the Eagle Forum Board. The court further found that John
6
and Martin had demonstrated an unwillingness or incapacity to serve the best interests of
Eagle Forum. The court concluded that allowing John and Martin “to continue to use,
access, control, transfer and or modify Eagle Forum property and resources” was
detrimental to the status quo and contrary to the court’s desire to protect and preserve the
assets of Eagle Forum pending a resolution of the case on the merits.
¶ 17 In the Amended TRO, the court directed that the plaintiffs, as Majority Directors of
Eagle Forum, “shall immediately assume temporary sole control and possession over all
Eagle Forum property,” including but not limited to:
• (1) the eagleforum.org domain name and website;
• (2) all email addresses using the domain name “@eagleforum.org”;
• (3) all Eagle PayPal and social media accounts;
• (4) all usernames, passwords, passcodes, identification numbers, software and/or
information used to obtain access to and/or control of any Eagle Forum property,
accounts, and software;
• (5) the contact list of 14,000 active members of Eagle Forum, the contact list of
41,000 emails used by Eagle Forum for purposes of mass emails, in a useable
electronic format, and any other lists used by Eagle Forum in its day-to-day
operations prior to April 11, 2016;
• (6) all Eagle Forum electronic and hard copy files, books, records, or other
documents, including records of the names and contact information for all Eagle
Forum donors and members, including the history and amounts of donation;
7
• (7) all life insurance policies and related documentation;
• (8) all stock, investment, savings, checking, credit, and lending accounts; and
• (9) all credit cards, check books, and blank checks associated with the accounts.
In the Amended TRO, the court referred to the enumerated items collectively as “Eagle
Forum Property.”
¶ 18 The court further ordered that Eagle Forum should continue to transact business
with Eagle Trust Fund (ETF) and EFELDF, as it had in the past, provided that such
transactions did not violate Illinois and federal law, Eagle Forum Bylaws, or orders of the
court. The court directed that within 48 hours of its order, the defendants and all those
acting in concert with them “shall complete the transfer of all Eagle Forum Property” to
the plaintiffs and “cooperate in good faith” with the plaintiffs’ efforts to assume immediate
control and possession of all Eagle Forum Property. The court enjoined the defendants, and
those acting in concert with them, from “using, accessing, controlling, transferring,
copying, destroying or modifying any Eagle Forum Property” without the prior written
authorization of the plaintiffs.
¶ 19 The court also suspended Martin from his position as President of Eagle Forum and
John from his position as Treasurer of Eagle Forum. Phyllis Schlafly was removed as a
signatory on all Eagle Forum accounts. John and Martin were ordered to reverse any
changes made to the Eagle Forum website and to restore Eagle Forum as the registered
owner of the Eagle Forum domain name. The court authorized the plaintiffs to terminate
Eagle Forum’s legal counsel and retain independent legal counsel for Eagle Forum. The
court named Eunie Smith as acting President of Eagle Forum and Cori as acting Chairman
8
of Eagle Forum, and gave them exclusive authority to communicate with any third party
about the Eagle Forum® mark and Eagle Forum® registration. The Amended TRO was
signed and filed on October 20, 2016.
¶ 20 On October 24, 2016, with the ink barely dry on the Amended TRO, the plaintiffs
filed a motion seeking an order to show cause why John and Martin should not be held in
contempt. The plaintiffs alleged that John and Martin had failed to transfer any Eagle
Forum property to them within 48 hours after the Amended TRO was issued. The plaintiffs
asked the court to find John and Martin in contempt and to order appropriate sanctions
against them.
¶ 21 On December 15, 2016, Eagle Forum filed a motion for civil contempt against John
and Martin, alleging a failure to comply with the Amended TRO. Specifically, Eagle
Forum alleged that John and Martin failed to transfer a single piece of Eagle Forum
property to the plaintiffs; failed to turn over access, materials, and information regarding
the Washington, D.C., office; and failed to turn over financial information necessary to
Eagle Forum’s compliance with Federal Election Commission filings. Eagle Forum also
alleged that John and Martin sent mass correspondence to Eagle Forum members without
Eagle Forum’s authorization. Eagle Forum asked the court to impose sanctions on John
and Martin under Illinois Supreme Court Rule 219(c) (eff. July 1, 2002), including striking
their pleadings and awarding attorney fees to Eagle Forum. On January 26, 2017, Eagle
Forum filed a supplemental motion for contempt against Martin and John and alleged
additional violations of the Amended TRO.
9
¶ 22 On February 9, 2017, the court entered an order, as agreed to by the parties, directing
that the electronic version of Eagle Forum’s QuickBooks accounts, board minutes,
corporate records, and tax records for all years available be delivered to plaintiffs that day
(February 9, 2017). The court further ordered that all Eagle Forum checks and checkbooks,
all financial and bank statements, all board minutes and corporate records, and all mail
addressed to Eagle Forum be delivered to the plaintiffs on or before February 10, 2017.
Computer equipment and credit cards records were to be delivered to the plaintiffs within
14 days of the order.
¶ 23 On April 18, 2017, Eagle Forum filed second and third supplemental motions for
civil contempt against John. Eagle Forum asserted that John failed to return Eagle Forum
property in violation of the Amended TRO and the order of February 9, 2017, and that John
continued to represent that he was associated with Eagle Forum. Eagle Forum also filed a
second supplemental motion for civil contempt against Martin, and asserted that in media,
letters, and emails, Martin continued to represent that he was associated with Eagle Forum.
¶ 24 All pending motions for contempt were called for hearing on June 19, 2018, and
June 20, 2018. Following two days of testimony, the parties agreed to an order regarding
some of the disputed property, and the contempt proceedings were continued. The agreed
order was approved by the trial court and issued on August 22, 2018. Under the order,
Eagle Forum would obtain possession of and/or access to various items of property which
had been the subject of the contempt proceedings. The parties expressly agreed that nothing
contained within the order “was intended or should be construed as ruling on the pending
contempt motions or requests for sanctions,” and no party was “giving up, waiving, or
10
relinquishing any rights they may have” under any pending motions, including the
contempt motions.
¶ 25 C. Cori’s Motion for Statutory Contempt
¶ 26 On January 10, 2020, Cori filed a motion for partial summary judgment as to count
XX of the fifth amended complaint brought against John, Bruce Schlafly, and EFELDF.
Cori sought a judgment declaring that the April 8, 2016, meeting of the EFELDF Board of
Directors was held in violation of the notice requirements of the EFELDF’s Bylaws, and
that any actions taken during the meeting were invalid. 5 In support of the motion, Cori
attached a copy of the EFELDF Bylaws and an email, dated April 7, 2016, indicating that
a special meeting of the EFELDF’s Directors would be held on April 8, 2016.
¶ 27 On January 23, 2020, EFELDF filed a response in opposition to Cori’s motion for
partial summary judgment, and John and Bruce Schlafly joined in that response. EFELDF
asserted that Cori had been removed during the annual meeting of the Board of Directors
on September 18, 2016. EFELDF stated that it had never taken the position that Cori had
been removed from the Board during an informal telephone conversation on April 8, 2016.
EFELDF attached a supporting affidavit from John. In the affidavit, John averred:
5
According to count XX of the fifth amended complaint, Martin sent an email on April 7, 2016,
scheduling a meeting of the EFELDF Board of Directors for the following morning. On April 8, 2016, the
EFELDF Board of Directors convened a meeting via teleconference. Cori, then an EFELDF Director, was
on the call and objected because the meeting was convened without seven days’ notice as required by the
EFELDF Bylaws. Cori’s objection was noted, but the Board proceeded to conduct business, including
voting for Cori’s replacement on the Board of Directors.
11
“3. On April 8, 2016, certain members of the Board of EFELDF, myself
included, engaged in informal conversation amongst themselves.
4. EFELDF understood that the April 8, 2016, informal conversation did not
constitute a meeting of the Board of the Directors of EFELDF, and thus EFELDF
has taken no subsequent actions following and relying upon the April 8, 2016,
conversation.”
¶ 28 On January 27, 2020, Cori filed a reply with supporting documents. Cori attached
an audio recording and typed transcript of the Board meeting on April 8, 2016.
¶ 29 On February 10, 2020, the trial court granted Cori’s motion for partial summary
judgment. In its order, the court declared that the EFELDF meeting on April 8, 2016, was
“deemed” to have been conducted in violation of EFELDF’s then-existing bylaws, that the
actions taken during the April 8, 2016, meeting were deemed invalid actions, and that Cori
remained a director of EFELDF “at least until September 18, 2016.”
¶ 30 On February 20, 2020, Cori filed a motion asking the court to find John and
EFELDF in statutory contempt pursuant to section 2-1005(f) of the Code of Civil
Procedure (Code) (735 ILCS 5/2-1005(f) (West 2018)), for filing an affidavit in bad faith
and for purposes of delay. Cori alleged that John’s affidavit, filed in support of EFELDF’s
opposition to her motion for partial summary judgment, contained false and misleading
statements regarding the nature of the EFELDF meeting on April 8, 2016. She sought an
award of attorney fees and expenses pursuant to the terms of the statute.
¶ 31 D. The Contempt Order
¶ 32 From August 3, 2020, through August 10, 2020, the trial court conducted additional
evidentiary hearings on the show cause and contempt motions filed by the plaintiffs, Eagle
Forum, and Cori. After considering six days of sworn testimony, more than 600 pages of
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deposition testimony, and more than 2000 pages of exhibits, the court issued a 28-page
order (Contempt Order) containing the trial court’s rulings and reasoning.
¶ 33 The trial court initially addressed the show cause motion filed by the plaintiffs on
October 24, 2017. The court found that John and Martin failed to turn over Eagle Forum
property to the plaintiffs within 48 hours after the entry of the Amended TRO, but
concluded that their inaction was excusable. The court pointed to testimony indicating that
John and Martin believed that the attorneys who represented them in their capacities as
officials of Eagle Forum intended to seek a stay of the Amended TRO. Subsequently, those
attorneys, who also represented Eagle Forum, did not seek a stay or an appeal of the
Amended TRO. The court concluded that John and Martin offered a reasonable excuse for
their initial noncompliance and denied the plaintiffs’ show cause motion.
¶ 34 The trial court next addressed Eagle Forum’s pending contempt motions against
John and Martin. 6 After reviewing the evidence, the court found John in indirect civil
contempt because of his willful and inexcusable failure (a) to produce to Eagle Forum the
list of 14,000 Eagle Forum members and the contact list of 41,000 emails used by Eagle
Forum for mass emails; (b) to timely produce Eagle Forum’s tax returns, financial
statements, checks, and bank records; and (c) to turn over the keys and a garage door opener
to the office in Washington, D.C. The court concluded that there was insufficient evidence
6
These included the motion for contempt against John and Martin filed December 15, 2016; the
supplemental motion against John and Martin filed January 26, 2017; the second supplemental motion
against Martin filed April 18, 2017; the second supplemental motion against John filed April 18, 2017; and
the third supplemental motion against John filed April 18, 2017.
13
to find that John violated the Amended TRO pertaining to Eagle Forum’s domain name,
website, and associated email addresses.
¶ 35 After finding John in indirect civil contempt, the court ordered that “John Schlafly,
consistent with the Court’s Order of October 20, 2016, shall within twenty-one (21) days
of the date of this order:
1. Provide and cause to be delivered to Anne Cori as a member of the Board of
Directors of Eagle Forum, an electronic (in a common format such as .pdf)
or hard copy of any and all of the approximately 14,000 Eagle Forum
members’ contact, leader, and donor lists referred to in this Court’s Order of
October 20, 2016. This paragraph should not be construed or interpreted to
mean that this Order determines that Eagle Forum, Eagle Trust Fund or
EFELDF has an interest in any such list or information contained therein that
is superior to that of any other person or entity.
2. Provide and cause to be delivered to Anne Cori as a member of the Board of
Directors of Eagle Forum any all corporate records for Eagle Forum
including any and all financial accounting records, tax returns and associated
and supporting documents, bank account statements, checks (including
uncancelled instruments), financial statements, by-laws, and other corporate
documents in his actual or constructive possession regardless of whether
such item of property is held or is claimed by to be held by him personally,
as a trustee of Phyllis Schlafly Revocable Trust or as a member of Eagle
Trust Fund.
3. Provide and cause to be delivered to Anne Cori as a member of the Board of
directors of Eagle Forum any and all passwords, usernames, passcodes,
identification numbers and necessary access information in any format
relative to or otherwise necessary to access or control Eagleforum.org, its
website, or email accounts associated with or pointed to by Eagleforum.org.
4. Provide and cause to be delivered to Anne Cori as a member of the Board of
directors of Eagle Forum any and all passwords, usernames, passcodes,
identification numbers and necessary access information relative to
Eagleforum.org’s domain registration and renewal with any hosting service
provider including, but not limited to, GoDaddy, Host Monster, and Network
Solutions.
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5. Provide and cause to be delivered to Anne Cori as a member of the Board of
Directors of Eagle Forum any and all letters, emails, correspondence,
certificates, and any and all other documents relative to the Eagle Forum®
mark.”
¶ 36 The court also directed John to file an affidavit attesting to his compliance with the
order. The Contempt Order included the following penalty provision in the event John
failed to comply:
“It is further ordered that for each day that John Schlafly shall fail to timely
comply with as [sic] aspect of this order, John Schlafly shall be personally assessed
a sanction of $250.00 per day. In the event that John Schlafly shall fail to comply
with this order for a period of thirty (30) days from the date of this Order, he may
be thereafter confined in the Madison County Jail and remain in the custody of the
Madison County Sheriff until he complies with this Order.”
¶ 37 The trial court then considered the contempt allegations against Martin. The court
found Martin in contempt of the Amended TRO because of his use of the list of the 14,000
active Eagle Forum members and the contact list of 41,000 emails used by Eagle Forum
for mass emails. The court did not find Martin in contempt for his refusal to turn over
domain names, domain hosts, and associated email lists. The court also determined that the
evidence was not sufficient to show that Martin held himself out as a representative of
Eagle Forum, as alleged.
¶ 38 The court indicated that it would order John and Martin to pay the reasonable
attorney fees and expenses that Eagle Forum incurred in preparing and presenting those
motions in which contempt was established. Eagle Forum was directed to file its claim for
fees and expenses, along with supporting documentation, within 21 days of the order.
¶ 39 The trial court next considered Cori’s motion to find John and EFELDF in statutory
civil contempt for filing a false affidavit. The court examined the transcript of the April 8,
15
2016, meeting and concluded that the descriptions in John’s affidavit, depicting the
meeting as an “informal conversation,” were “at odds” with the transcript. The court noted
that Phyllis Schlafly had thanked the EFELDF Directors for “coming to our first time ever
telephone board meeting,” that roll call was taken, and that motions were made and voted
upon, including a motion to replace Cori as Treasurer of EFELDF. The court further noted
that the activities of the EFELDF Directors on April 8, 2016, were nothing like those
typically witnessed during “informal conversations.” The court found that John’s
characterization of the April 8, 2016, meeting, as set forth in his affidavit, was not “simply
bad judgment or negligence,” but rather “the conscious doing of a wrong because of a
dishonest purpose.” The court concluded John’s affidavit “was made for the purpose of
delay and was, in fact, made in bad faith.” The court adjudged John in civil contempt as
authorized by section 2-1005(f) of the Code (735 ILCS 5/2-1005(f) (West 2018)) and
indicated that it would order John to pay the reasonable expenses, including attorney fees,
that Cori incurred in filing and prosecuting her motion.
¶ 40 All other contempt allegations not specifically discussed in the Contempt Order
were denied. Cori filed her motion for attorney fees and expenses on October 2, 2020.
Eagle Forum filed its petition for attorney fees and expenses on October 13, 2020.
¶ 41 On October 15, 2020, John filed an affidavit averring that he “fully and completely
complied” with the Contempt Order by causing to be delivered all of the items that were
in his actual or constructive possession as of the date he signed the affidavit. Specifically,
John stated that he caused to be delivered the lists described in paragraph 1, the records
and documents described in paragraph 2, and the documents and communications
16
described in paragraph 5. John further stated that he did not “actually or constructively
possess, nor have access to,” any of the items described in paragraphs 3 and 4 of the
Contempt Order.
¶ 42 On October 19, 2020, John filed his notice of appeal from the Contempt Order
pursuant to Illinois Supreme Court Rule 304(b)(5) (eff. Mar. 8, 2016). On October 29,
2020, Eagle Forum and Cori filed separate motions to dismiss John’s appeal for lack of
appellate jurisdiction under Rule 304(b)(5). Eagle Forum also filed a notice of cross-appeal
in the event its motion to dismiss the appeal was denied.
¶ 43 II. ANALYSIS
¶ 44 On appeal, John claims that the trial court abused its discretion in finding him in
indirect civil contempt for noncompliance with the Amended TRO. John also claims the
court erred in finding him in statutory contempt under section 2-1005(f) of the Code (735
ILCS 5/2-1005(f) (West 2018)), because the affidavit he filed in opposition to Cori’s
motion for partial summary judgment was not submitted in bad faith or for purposes of
delay.
¶ 45 A. Appellate Jurisdiction
¶ 46 In this case, the Contempt Order did not fully dispose of the proceedings and the
case remains pending in the trial court. John filed this appeal pursuant to Illinois Supreme
Court Rule 304(b)(5) (eff. Mar. 8, 2016). Cori and Eagle Forum filed separate motions to
dismiss the appeal. Each argues that appellate jurisdiction is lacking under Rule 304(a)(5)
because the trial court did not impose a penalty after finding John in contempt.
17
¶ 47 Illinois Supreme Court Rule 304 governs appeals from final judgments that do not
dispose of the entire case. Ill. S. Ct. R. 304 (eff. Mar. 8, 2016). Under Rule 304(a), “an
appeal may be taken from a final judgment as to one or more but fewer than all parties or
claims only if the trial court has made an express written finding that there is no just reason
for delaying either enforcement or appeal or both.” Ill. S. Ct. R. 304(a) (eff. Mar. 8, 2016).
Rule 304(b) contains exceptions to the special finding requirement in paragraph (a) of the
rule. Under Rule 304(b)(5), “[a]n order finding a person or entity in contempt of court
which imposes a monetary or other penalty” is appealable without a Rule 304(a) finding.
Ill. S. Ct. R. 304(b)(5) (eff. Mar. 8, 2016). An order that finds an individual in contempt
without imposing a penalty is not final and not reviewable. In re Estate of Hayden, 361 Ill.
App. 3d 1021, 1026 (2005); Vowell v. Pedersen, 315 Ill. App. 3d 665, 666 (2000).
¶ 48 The trial court found John in civil contempt under section 2-1005(f) of the Code
(735 ILCS 5/2-1005(f) (West 2018)) 7 for filing an affidavit in bad faith and for purposes
of delay. The court determined that Cori was entitled to recover reasonable attorney fees
and expenses associated “with countering the false affidavit” and prosecuting her motions
for contempt, but the court did not impose a specific penalty, and the court did not make a
Rule 304(a) finding. Cori filed a fee petition, and that petition was pending when John filed
his notice of appeal. Because the amount of the fees was to be assessed in the future and
7
Section 2-1005 provides that when “it appears to the satisfaction of the court at any time that any
affidavit presented pursuant to this Section is presented in bad faith or solely for the purpose of delay, the
court shall without delay order the party employing it to pay the other party the amount of reasonable
expenses which the filing of the affidavit caused him or her to incur, including reasonable attorney’s fees,
and any offending party may be adjudged guilty of contempt.” 735 ILCS 5/2-1005(f) (West 2018).
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because the contempt order imposed no specific fine or penalty, we do not have jurisdiction
under Rule 304(b)(5) to consider John’s appeal from the statutory civil contempt order.
Pedigo v. Youngblood, 2015 IL App (4th) 140222, ¶ 17. Therefore, John’s appeal from the
trial court’s finding of statutory contempt is dismissed for lack of jurisdiction.
¶ 49 Next, we consider whether we have jurisdiction under Rule 304(b)(5) to consider
the trial court’s findings of indirect civil contempt against John. According to the record,
the trial court found John in indirect civil contempt for failing to comply with provisions
in the Amended TRO. The court then ordered John to deliver several items of property to
Eagle Forum within 21 days of the order. The court further ordered that “for each day that
John Schlafly shall fail to timely comply” with any aspect of this order, he shall be assessed
a sanction of $250 per day. If John failed to comply with the order for a period of 30 days
from the date of the order, he could have been “confined” in the Madison County jail until
he complied. Thus, the trial court imposed a continuing and indefinite penalty of $250 per
day, and possible incarceration, but delayed enforcement for 21 days to allow John to purge
the contempt. 8 Accordingly, we have jurisdiction under Rule 304(b)(5) to consider that
portion of the contempt order.
¶ 50 In respective motions to dismiss, Cori and Eagle Forum sought sanctions under
Illinois Supreme Court Rule 375 (eff. Feb. 1, 1994), arguing that this appeal was not
justified under existing law. The imposition of sanctions under Rule 375 is a matter within
the discretion of the reviewing court. Henby v. White, 2016 IL App (5th) 140407, ¶ 28.
8
Based on an affidavit executed on October 15, 2020, John complied with the contempt order, but
he did so after the 21-day deadline had passed.
19
After reviewing the record and the arguments on appeal, we do not find that sanctions are
warranted. Therefore, the requests by Cori and Eagle Forum for Rule 375 sanctions are
denied.
¶ 51 B. Indirect Civil Contempt and the Amended TRO
¶ 52 On appeal, John claims that the trial court abused its discretion in finding him in
indirect civil contempt for noncompliance with the Amended TRO. John argues that the
Contempt Order should be vacated because it primarily served to punish him for past
noncompliance, rather than to coerce future compliance. John contends that the trial court
failed to consider whether there was a current need for enforcement of the Amended TRO,
and whether it was possible for him to purge the contempt. John claims that much of the
property identified in the Amended TRO was turned over before the Contempt Order was
issued. He claims that he was unable to turn over other property because it was not under
his control.
¶ 53 Civil contempt orders are designed to compel a contemnor to perform a specific act
or acts. In re Marriage of Betts, 200 Ill. App. 3d 26, 46 (1990). Civil contempt sanctions
are prospective in nature and invoked to coerce compliance with the court’s order. Betts,
200 Ill. App. 3d at 43. In civil contempt proceedings, the contemnor must be capable of
taking the action sought to be coerced, and no further contempt sanctions are imposed upon
the contemnor’s compliance with the pertinent order. Betts, 200 Ill. App. 3d at 43. A
sanction must be vacated when it becomes evident that the sanction is no longer fulfilling
its coercive function. Hayden, 361 Ill. App. 3d at 1029. The contemnor bears the burden to
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show that the sanction has lost its coercive effect and will not cause him to comply with
the order. Hayden, 361 Ill. App. 3d at 1029-30.
¶ 54 In a civil contempt proceeding, the burden of proving contempt is on the party
bringing the motion, and the contempt must be proven by a preponderance of the evidence.
Harper v. Missouri Pacific R.R. Co., 282 Ill. App. 3d 19, 28 (1996). Noncompliance with
an order is prima facie evidence of civil contempt. In re Estate of Baldassarre, 2018 IL
App (2d) 170996, ¶ 36. Once noncompliance is established, the burden shifts to the
contemnor to establish that he did not have the means or ability to comply with the order.
Baldassarre, 2018 IL App (2d) 170996, ¶ 36; County of Cook v. Lloyd A. Fry Roofing Co.,
59 Ill. 2d 131, 137 (1974). The defense of inability is unavailable, where a contemnor has
voluntarily created the inability to comply. Fry Roofing, 59 Ill. 2d at 137. It is the trial
court’s function to weigh the evidence, judge the credibility of the witnesses, and make
findings of fact. Harper, 282 Ill. App. 3d at 28-29. Whether a party’s conduct is
contemptuous is within the sound discretion of the trial court, and a reviewing court will
not reverse the trial court’s adjudication of contempt absent an abuse of discretion. People
v. Cole, 2017 IL 120997, ¶¶ 19-20.
¶ 55 The trial court found John in indirect civil contempt because of his willful and
inexcusable failure (a) to produce the list of 14,000 Eagle Forum members and the contact
list of 41,000 emails used Eagle Forum for mass emails; (b) to timely produce Eagle
Forum’s tax returns, financial statements, checks, and bank records; and (c) to turn over
the keys and a garage door opener to the Washington, D.C., office. In its order, the court
provided the factual basis and reasons for each finding of contempt.
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¶ 56 The trial court initially considered whether John complied with the order to turn
over the contact list of 14,000 Eagle Forum members and at least some of the contact lists
of 41,000 emails used by Eagle Forum for purposes of sending mass emails. During the
contempt proceedings, John admitted that he did not turn over the contact lists at issue.
John explained that there were no actual “lists,” but instead, a much larger database that
contained information regarding members, donors, and leaders. He testified that the Phyllis
Schlafly Revocable Trust (PSRT) had asserted ownership in the database, and that ETF
was the custodian of the database. John claimed that he was unable to comply with the
Amended TRO because he was neither the owner nor the custodian of the database and had
no control over it. John also claimed that extracting Eagle Forum information from the
larger database would be a difficult task.
¶ 57 The trial court was not persuaded by John’s contention that he could not comply
with the court’s order. The court observed that John was the sole trustee of PSRT and that
he was one of two members of ETF. John had not asked the trial court for relief due to an
inability to perform because of his fiduciary responsibilities to PSRT and his lack of control
over the database. John had not asked for additional time to complete the task of extracting
the Eagle Forum information from the larger database. The court pointed out that John and
Martin had submitted affidavits, dated April 26, 2016, in which they averred that Eagle
Forum and EFELDF jointly maintained proprietary membership, donor, contact lists. The
court concluded, therefore, that “John simply did not want to produce the list information
and data and was willing to withhold it” despite the directive in the Amended TRO. The
court found that John’s failure to comply with the order to produce the lists was “willful
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and without reasonable excuse,” and held him in indirect civil contempt. John was ordered
to deliver an electronic or hard copy of the contact lists of the members, donors, and leaders
referred to in the Amended TRO, and the court imposed a conditional sanction on John to
coerce his compliance.
¶ 58 In this case, John had the burden to demonstrate a legitimate inability to comply
with the Amended TRO. People v. Johnson, 2017 IL App (1st) 162876, ¶ 20; Killion v.
City of Centralia, 381 Ill. App. 3d 711, 715 (2008). After evaluating the credibility of the
witnesses and weighing the evidence, the trial court reasonably concluded that John failed
to demonstrate a legitimate inability to comply with that order. The trial court also
concluded there was a need to enforce the Amended TRO.
¶ 59 In this appeal, John argues that by the time the September 21, 2020, Contempt Order
was entered, the reason for ordering production of the lists had been resolved. John
contends that the trial court denied Eagle Forum’s claim to ownership of the lists in an
order entered August 4, 2020, and as a result, the provision in the Amended TRO requiring
delivery of the lists should have been deemed to have no further legal effect. He further
contends that once the provision requiring delivery of the lists expired, there was no basis
for holding him in indirect civil contempt. We disagree with John’s underlying premise. In
the order of August 4, 2020, the trial court found that Eagle Forum failed to meet the burden
of proof necessary to award a declaratory judgment or a summary judgment in its favor on
the issue of ownership of the lists. When the trial court ordered John to produce the lists in
the Contempt Order, the court specifically stated that its order should not be construed as
determining “that Eagle Forum, Eagle Trust Fund or EFELDF has an interest in any such
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list or information contained therein that is superior to any other person or entity.” In other
words, the trial court had not yet decided the issue regarding ownership of the lists. The
Amended TRO did not “expire.” John was required to comply with its terms. Our courts
have the power to preserve the status quo of the parties and the subject matter of the
litigation until a final determination is made. When John was ordered to deliver the contact
lists, the trial court had not made a final decision regarding ownership of the lists.
¶ 60 The purpose of the Contempt Order was to compel future compliance through the
production of the information in the above referenced contact lists. In an affidavit of
compliance dated October 15, 2020, and accompanying letter of transmittal, John indicated
that a flash drive containing the lists described in paragraph 1 of the Contempt Order had
been delivered to Eagle Forum. Thus, John’s contention that the Contempt Order failed to
identify any current contempt from which John could purge himself is not supported by the
record. After reviewing the record, we find that the trial court did not abuse its discretion
in finding John in indirect civil contempt for failing to produce the contacts list information.
¶ 61 The trial court also held John in indirect civil contempt for his failure to deliver the
Eagle Forum tax returns, financial statements, checks, and bank records in a timely manner.
The court noted that there was evidence to show that John was the Treasurer of Eagle
Forum from 2000 until 2016, and that as Treasurer, John had ready access to the financial
and corporate documents of Eagle Forum. The court further noted that during testimony,
John admitted that he failed to produce all of the documents in a timely fashion. In addition,
documentary evidence revealed that financial statements, tax returns, and electronic files
had not been provided to Eagle Forum until approximately 20 months after the Amended
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TRO was issued. Again, the trial court observed that John did not ask for additional time
to produce the documents or any other relief. The court concluded that John’s failure to
timely comply with its order “strongly” suggested that his conduct was willful. The court
found John in indirect civil contempt and ordered him to deliver to Eagle Forum any and
all corporate records of Eagle Forum, including financial, accounting records, and tax
records, in his actual or constructive possession.
¶ 62 Paragraph 2 of the Contempt Order required John to deliver all corporate, financial,
and tax records in John’s actual or constructive possession. In his affidavit of compliance
dated October 15, 2020, John stated that he turned over all of the documents and
communications described in paragraph 2 of the Contempt Order. Again, John’s contention
that the Contempt Order failed to identify any ongoing contempt from which John could
purge himself is incorrect. The purpose of the Contempt Order was to compel future
compliance through the production of the Eagle Forum records in John’s possession. After
reviewing the record, we do not find that the trial court abused its discretion in finding John
in indirect civil contempt for failing to deliver Eagle Forum’s corporate, financial, and tax
records to Eagle Forum.
¶ 63 The trial court also found John in indirect civil contempt for failing to provide Eagle
Forum with a garage door opener and keys to an office in Washington, D.C. During the
hearing, John testified that EFELDF and ETF were the leaseholders on the property, and
that an EFELDF employee delivered the keys and garage door opener to the landlord of
the property. John thought the keys should be given to the landlord, rather than to Eagle
Forum. The trial court found that Eagle Forum offered two documents that rebutted John’s
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testimony. These documents demonstrated that Eagle Forum was the leaseholder of the
property, and that Eagle Forum sublet a portion of that property to EFELDF and ETF.
¶ 64 John also argued that the trial court should not hold him in contempt for refusing to
provide access to the D.C. office, because it was no longer possible to purge the contempt.
John pointed out that the lease expired on January 31, 2017, more than 3½ years before the
contempt finding, and that Eagle Forum admitted that the D.C. office was “no longer leased
by Eagle Forum.” The trial court recognized that the refusal to return the keys and opener
to Eagle Forum was arguably of little importance at that point, except to illustrate an
ongoing disregard for the court’s orders and authority. The court found that John’s failure
to deliver the keys and opener, coupled with his delay in turning over other items of
property as required, demonstrated a “level of willfulness more than adequate to support
an order of contempt.” The court found John in willful contempt for failing to turn return
the keys and door opener to Eagle Forum as required.
¶ 65 Civil contempt is intended to provide a coercive penalty to compel future
compliance, and a valid purge condition is a necessary part of an indirect civil contempt
order. Felzak v. Hruby, 226 Ill. 2d 382, 391 (2007); Betts, 200 Ill. App. 3d at 46. The
contemnor must be capable of taking the action sought to be coerced, and the sanction must
be vacated when it is no longer fulfilling its coercive function. Hayden, 361 Ill. App. 3d at
1029. While we understand the trial court’s view that John’s conduct was an illustration of
his seeming disregard for the court’s authority, the record demonstrates that John did not
have the ability to purge himself of this violation of the Amended TRO. As a result, the
trial court erred in finding that John was in indirect civil contempt for failing to deliver the
26
keys and garage door opener to Eagle Forum, and that finding is hereby vacated. Felzak,
226 Ill. 2d at 391-92.
¶ 66 C. Eagle Forum’s Cross-Appeal
¶ 67 In a cross-appeal, Eagle Forum challenged the trial court’s finding that John was
not in indirect civil contempt for failing to turn over domain names, domain hosts, and
associated emails. Eagle Forum also challenged the trial court’s findings that defendant
Martin was not in indirect civil contempt of the Amended TRO relative to holding himself
out as an Eagle Forum representative and failing to deliver domain names, domain hosts,
and associated emails. These rulings are interlocutory in nature. They are not final and
appealable under Supreme Court Rule 304(b)(5), and absent an express written finding
under Supreme Court Rule 304(a), we are without jurisdiction to consider them.
Accordingly, Eagle Forum’s cross-appeal is dismissed for lack of appellate jurisdiction.
¶ 68 Finally, during the briefing of this appeal, John filed a motion to strike a separate
appendix filed by Eagle Forum, and Eagle Forum filed a response in opposition to the
motion to strike. The motion was taken with the case and is hereby denied.
¶ 69 III. CONCLUSION
¶ 70 In summary, we find that the trial court did not abuse its discretion in holding John
in indirect civil contempt for violating the Amended TRO by (a) failing to turn over the
contact list of 14,000 Eagle Forum members and at least some of the contacts lists of 41,000
emails used by Eagle Forum for purposes of sending mass emails, and (b) failing to
produce Eagle Forum corporate records. The trial court correctly concluded that there was
a current need to enforce the Amended TRO. The Contempt Order and the penalties were
27
imposed for the purpose of compelling future compliance through the production of the
aforementioned property. The trial court abused its discretion, however, in finding John in
indirect civil contempt for failing to deliver the keys and garage door opener for the office
in Washington, D.C., to Eagle Forum, and that finding is hereby vacated. Accordingly, the
trial court’s order finding John in indirect civil contempt is affirmed in part and vacated in
part. John’s appeal from the trial court’s finding of statutory contempt and Eagle Forum’s
cross-appeal are dismissed for lack of appellate jurisdiction.
¶ 71 Affirmed in part, vacated in part, and dismissed in part.
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