SECOND DIVISION

									June 4, 2002	 												

No. 1-01-2420

WILLIAM BRUCE HOFF, JR., and 

CATHERINE M. HOFF,

		Plaintiffs-Appellants,

	v.

MAYER, BROWN AND PLATT, an Illinois 

Partnership,

		Defendant-Appellee.

)

)

)

)

)

)

)

)

)

)

)

Appeal from the

Circuit Court of

Cook County.

No. 00 CH 12022

Hon. Bernetta D. Bush,

Judge Presiding.

	JUSTICE McBRIDE delivered the opinion of the court:

	On August 16, 2000, William Bruce Hoff, Jr. (Hoff), and

Catherine Hoff, his wife, filed a complaint for declaratory

judgment and other relief in the circuit court of Cook County

against Mayer, Brown & Platt (MBP), a Chicago law firm. 

Thereafter, MBP filed a motion to dismiss plaintiff's complaint

pursuant to section 2-615 of the Illinois Code of Civil Procedure 

(735 ILCS 5/2-615 (West 2000)).  On June 12, 2001, the trial court

granted defendant's motion.  Hoff now appeals.

	Hoff argues on appeal: (1) that the retirement provision in

MBP's restated plan is a restrictive covenant and is contrary to

Illinois public policy; (2) that the provision is unreasonably

broad; and (3) that under any circumstance, Hoff is entitled to a

trial on the issues of whether he has materially competed with MBP

and whether MBP can reasonably refuse to determine that any alleged damage caused by Hoff has ended.

	According to the complaint, Hoff resigned as a partner with

MBP on July 9, 1993.  At the time of his resignation, Hoff was 60

years old and had been with MBP for 36 years.  Hoff requested

retirement income from MBP.  MBP has refused to pay Hoff retirement

income based on its "Restated Partnership Agreement, Retirement,

Disability & Death Benefit Program" (Restated Plan or Plan).  In

his complaint, Hoff alleges that he should have been receiving in

excess of $94,000 per year in retirement income, plus additional

cost-of-living adjustments, pursuant to the Plan, since his

resignation in 1993.  From the record below, there is no dispute

that Hoff left MBP to become a founding partner in another Chicago

firm – Kasowitz, Hoff, Benson & Torres.  Additionally, Hoff received all earned fee income, capital shares, financial benefits 

and other revenue to which he was entitled, based on his

association with MBP and his years of service to the firm.  He

disputes only MBP's decision to deny him retirement benefits.

	A trial court ruling on a motion to dismiss under section 2-

615 interprets all pleadings and supporting documents in the light

most favorable to the nonmoving party.  Dial Corp. v. Marine Office of America, 318 Ill. App. 3d 1056, 1060, 743 N.E.2d 621 (2001).  The lower court should grant a motion to dismiss only where it

finds that no set of facts would support a cause of action.   Dial Corp., 318 Ill. App. 3d at 1060.  Because this approach does not require the trial court to weigh facts or determine the credibility of witnesses, the appellate court reviews the matter de novo. Dial Corp., 318 Ill. App. 3d at 1060.

	The dispute here centers around sections 3.1 and 3.2 of MBP's

Restated Plan, and Rule 5.6 of the Illinois Rules of Professional

Conduct (134 Ill. 2d R. 5.6).  MBP's Restated Plan states:  

		"3.1	In General.  If a member's membership in the firm is terminated by reason of his

or her retirement on a retirement date

(as described in subsection 3.2) on or

after January 1, 1987, he or she will be

provided with a retirement income in an

amount determined in accordance with the

provisions of subsection 3.3.

		3.2	Retirement Date.  The 'retirement date' for a member is the one of the following

dates that applies in his or her case:

			(a)	Normal Retirement Date.  The 'normal retirement date' for a

member shall be the first day

of the calendar month as of

which he or she elects to

retire or is retired by the

firm, provided in either event

that, as of such day, he or she

shall have also either (i) attained at least 65 years of

age or (ii) attained at least

62, but not yet attained 65,

years of age and completed at

least 20 years' associated with

the firm.

			(b)	Early Retirement Date. The 'early retirement date' for a

member shall be the first day

of the calender month as of

which he or she elects to

retire or is retired by the

firm, provided in either event

that, as of such day, he or she

shall have also attained at

least 60, but not yet 62, years

of age and completed at least

20 years' associated with the

firm.

		For purposes of this program, a member shall

not be deemed to have elected to retire prior

to attaining age 65 unless he or she

substantially ceases the active practice of

law on a permanent basis or his or her post-

retirement practice of law is determined by the firm to be consistent with his or her

status as a retiree."

	Rule 5.6(a) of the Illinois Rules of Professional Conduct,

entitled "Restrictions on Right to Practice," provides: "A lawyer

shall not participate in offering or making: (a) a partnership or

employment agreement that restricts the rights of a lawyer to

practice after termination of the relationship, except an agreement

concerning benefits upon retirement***."  134 Ill. 2d R. 5.6(a).

	Hoff first claims that MBP's Restated Plan is basically a

restrictive covenant and is contrary to Illinois public policy. 

Hoff argues that whether MBP's Plan comports with Rule 5.6(a)

depends on whether the "benefits" under the Plan constitute

"retirement benefits" under Rule 5.6(a).

	Hoff correctly points out in his brief that under Rule 5.6(a),

a lawyer may not participate in an agreement that "restricts the

rights of a lawyer to practice" after a relationship between the

lawyer and firm has ended.  134 Ill. 2d R. 5.6(a).  Illinois public

policy has consistently discouraged law firm employment agreements

that contain noncompetition clauses or restrictive covenants. 

Stevens v. Rooks Pitts & Poust, 289 Ill. App. 3d 991, 998, 682 N.E.2d 1125 (1997). Historically, these provisions have been strictly scrutinized by the courts as they can result in restraints

on trade.  Williams & Montgomery, Ltd. v. Stellato, 195 Ill. App. 3d 544, 553, 552 N.E.2d 1100 (1990).  "The rule is designed both to

afford clients greater freedom in choosing counsel and to protect lawyers from onerous conditions that would unduly limit their

mobility."  Dowd & Dowd, Ltd. v. Gleason, 181 Ill. 2d 460, 481, 693 N.E.2d 358 (1998).    Noncompetition clauses are especially discouraged in the legal profession where the lawyer is not selling

or promoting a commodity but rather his or her personal service. 

Rule 5.6 was also designed to protect lawyers and clients from

"illegitimate anti-competitive practices that will distort the

market and ultimately drive up the price of legal services."  2 G. 

Hazard & W. Hodes, The Law of Lawyering §5.6:101, at 823 (1992

Supp.). 

	Rule 5.6(a), however, provides for an exception to the rule

that noncompetition provisions are generally unenforceable.  The

rule states that an agreement concerning benefits upon retirement 

is exempt from the general rule.  It has been noted that "[t]he purpose and meaning of the exception for 'benefits upon retirement'

* * * is not crystal clear."  2 G. Hazard & W. Hodes, The Law of

Lawyering §5.6:201, at 824 (1992 Supp.).  The Annotated Model Rules

of Professional Conduct interprets the retirement benefits

exception to mean that 

		"when a lawyer is retiring or winding up his

or her affairs with a firm, the lawyer's

receipt of full retirement benefits entails an

assumption that he or she is truly retiring

from practice.  This further suggests that the

lawyer may be required to agree to 'stay retired' as a condition of the settlement." 

Annotated Model Rules of Professional Conduct

466-67 (4th ed. 1999).  

We find this interpretation instructive.

	The parties have noted, and we agree, that no Illinois case

directly addresses this issue.  Hoff does, however, draw our

attention to Illinois cases that he argues provide guidance.  Hoff

cites a United States District Court, Northern District, case for

the proposition that a broad reading of the retirement benefits

exception to Rule 5.6(a) is flawed.  Prior to oral argument, Hoff

cited Cummins v. Bickel & Brewer, No. 00 C 3703 (N.D. Ill. February 6, 2002), as additional authority.  Before its summary judgment

order of February 6, 2002, the district court filed a motion to

dismiss order in Cummins v. Bickel & Brewer, No. 00 C 3703 (N.D. Ill. March 1, 2001).  In that set of cases, Cummins, a former

partner with the law firm of Bickel & Brewer, sued his former firm

for refusing to pay him interest in the partnership upon his

withdrawal from the firm.  The Cummins court relied on Dowd & Dowd, Ltd.  Cummins, slip op. at 4 (N.D. Ill. March 1, 2001).  In Dowd & Dowd, Ltd., the law firm sought relief from the Illinois Supreme Court, contending that the appellate court erred in refusing to

uphold the noncompetition clause in its employment contracts.  The

noncompetition clause in that case stated that an employee of the

law firm was prohibited from handling any client of the firm for

two years following termination of employment with the firm.  The court held that that provision was in direct violation of Rule 5.6

and held it to be unenforceable.  Dowd & Dowd, Ltd., 181 Ill. 2d at 480.  In Cummins, the district court stated that the facts in Dowd & Dowd, Ltd. were "almost identical" to the facts in Cummins.  Cummins, slip op. at 4 (N.D. Ill. March 1, 2001).  We find that the facts in Dowd & Dowd, Ltd., together with the limited precedential value of Cummins, make these cases unpersuasive.  Because the rules committee found it important to include a specific retirement

benefits exception to the noncompetition provisions of law firm

agreements, we are obligated to base our decision on the plain

language of the rule as it applies to the facts of the matter

before us.   

	Hoff also notes that in Stevens, the court found the law firm's employment agreement violative of public policy.  The

agreement limited compensation payable to any withdrawing partner

if the partner competed with the firm in a certain geographical

area.  The firm unsuccessfully argued that their employment

agreement did not violate Rule 5.6 because it merely provided a

"modest measure of recoupment to [the firm] for the economic harm

caused by the departure and subsequent competition of one of its

partners."  Stevens, 289 Ill. App. 3d at 995.  The firm did not argue and the Stevens court did not address the retirement benefits exception to Rule 5.6.  Therefore, we do not find that the case

provides guidance.

	As MBP has pointed out in its brief, courts in other states have addressed the public policy considerations of Rule 5.6 and

have upheld retirement benefits provisions in law firm employment

contracts similar to the one at issue here.  In Neuman v. Akman, 715 A.2d 127 (D.C. App. 1998), Neuman left his former law firm to

engage in private practice and sued his former firm alleging that

their partnership agreement violated Rule 5.6(a) of the District of

Columbia Rules of Professional Conduct.1  The agreement provided that a partner leaving the firm would be eligible for capital

contributions and a share of the net partnership profits but would

be denied an "Additional Amount" linked to the future earnings of

the firm if the partner retired and engaged in the private practice

of law anywhere in the United States.  The trial court held that

the "Additional Amount" constituted a retirement benefit and, as

such, fit within the exception under Rule 5.6(a).  The appellate

court affirmed and held that the "Additional Amount comes entirely

from firm profits that post-date the withdrawal of the partner. ***

It is only future firm revenues that Neuman will be deprived of,

and only because he is at least potentially competing with the firm

and effecting a depression of those revenues."  Neuman, 715 A.2d at 136.  As we find the facts in Neuman to be on point, we are persuaded by that court's reasoning and holding.  From the record

below, Hoff is requesting that MBP provide him with future firm

revenues through his retirement benefits while he competes against MBP in the same city.  Like Neuman, we find that Rule 5.6(a) was designed specifically to address and correct this situation.

	The Neuman court notes that the leading case interpreting Rule 5.6(a) or its equivalent is Cohen v. Lord, Day & Lord, 75 N.Y.2d 95, 550 N.E.2d 410 (1989).  We, too, find this case helpful.  In

Cohen, the New York court held that a law firm partnership agreement which conditioned payment of earned but uncollected

partnership revenues upon the withdrawing partner's obligation to

refrain from competing with the firm was unenforceable.  The court

found the provision to be a significant monetary penalty and an

impermissible restriction on the practice of law.  The Cohen court distinguished financial disincentives and penalties from the 

retirement exception in the applicable rule.  Specifically, the

court found that retirement benefits are separate and distinct from

the financial penalties at issue, otherwise the exception would

swallow the rule.  "[T]o treat departure compensation as a

retirement benefit would invert the exception into the general

rule, thus significantly undermining the prohibition against

restraints on lawyers practicing law."  Cohen, 75 N.Y.2d at 100, 550 N.E.2d at 412.  Gray v. Martin, 63 Or. App. 173, 663 P.2d 1285 (1983), cited by both parties here and the Cohen court, holds similarly.  Like Cummins, the Gray court held that the law firm partnership agreement which required a forfeiture of financial

benefits if the withdrawing attorney practiced law in competition

with the firm was in violation of the noncompetition clause restrictions found in the professional conduct rules.  The

provision in the partnership agreement did not discriminate between

retiring and withdrawing partners.  The Gray court noted that, but for the distinction, "[e]very termination of a relationship between

law partners would be a retirement, and agreements restricting the

right to practice would always be allowed."  Gray, 63 Or. App. at 179, 663 P.2d at 1290.  The provision in the partnership agreement

at issue here addresses retirement only.  The distinction between

this provision and one found in Cohen, Gray and Cummins is important.  

	MBP also draws our attention to Donnelly v. Brown, Winick, Graves, Gross, Baskerville, Schoenebaum & Walker, P.L.C., 599 N.W.2d 677 (Iowa 1999).  In Donnelly, the Iowa Supreme Court held that the benefits under the law firm's retirement plan could be

conditioned on an attorney remaining out of the practice of law. 

Donnelly, a partner in Brown, Winick, left the firm after over 25

years of service to join a firm in the same city.  Donnelly's

length of time with Brown, Winick would have qualified him for

retirement benefits under the firm's plan.  The firm denied

Donnelly retirement benefits arguing that, under the plan, in order

to qualify for these benefits, Donnelly would have to "terminate

his...practice of law within the State of Iowa."  Donnelly, 599 N.W.2d at 679.  Donnelly countered by arguing that that provision

of the plan was a covenant not to compete and in violation of the

Iowa Code of Professional Conduct.  Donnelly, 599 N.W.2d at 679.  Iowa's rule addressing this issue, virtually identical to our Rule

5.6, states that covenants not to compete are a violation of the

rule except as a condition of payment of retirement benefits.  

Reviewing the firm's plan in that case, the court held that

"retirement benefits" under the Iowa Code of Professional Conduct

were required to be payments pursuant to a bona fide retirement plan.  The court found that the firm's retirement plan -- requiring

10 years of service and 60 years of age or 25 years of service --

qualified as a retirement plan and benefits under the firm's plan

could be conditioned on Donnelly remaining out of the practice of

law in Iowa, pursuant to the exception to the rule.  Donnelly, 599 N.W.2d at 680.  Like Donnelly, we find MBP's retirement plan to be a bona fide retirement plan.  Additionally, we find MBP's provision comports with Rule 5.6(a), and any retirement benefits offered by

MBP may be conditioned upon Hoff remaining out of the practice of

law.

	We recognize the concern that law firms may unfairly take

advantage of the exception in Rule 5.6(a).  Citing Cohen and Gray, the Annotated Model Rules of Professional Conduct opines: "in cases

when a law firm attempts to categorize a lawyer's departure from

the firm as a 'retirement' for purposes of restricting his or her

subsequent right to practice law, the courts have rejected such

retirement provisions."  Annotated Model Rules of Professional

Conduct 467 (4th ed. 1999).  Here, we do not find MBP's plan

characterized Hoff's departure from the firm as a retirement for purposes of restricting his right to practice law.  Rather,

"retirement" has been defined under the plan for purposes of

receiving future benefits.  As noted in the model rules, law firms

are restricted from using "retirement" for other such purposes. 

Annotated Model Rules of Professional Conduct 467 (4th ed. 1999). 

Here, Hoff was 60 years old and had been with MBP for 36 years when

he made the decision to resign from the firm and begin a new

partnership, and MBP provided Hoff with all fees and benefits due

and owing to him at the time of his resignation.  MBP denied Hoff

only future benefits under the firm's retirement provision.  In

interpreting the exception to Rule 5.6, the annotated rules explain

that receipt of retirement benefits would "entail[] an assumption

that [a lawyer] is truly retiring from practice *** [and] that a

lawyer may be required to agree to 'stay retired' as a condition of

the settlement."  Annotated Rules of Professional Conduct 466-67

(4th ed. 1999).    	

	The Connecticut Supreme Court addressed the issue of

postemployment benefits in Schoonmaker v. Cummings & Lockwood of Connecticut, P.C., 252 Conn. 416, 747 A.2d 1017 (2000).  In that case, Schoonmaker, a former partner with the defendant law firm,

argued that his former firm's decision to withhold compensation

upon his departure from the firm and decision to compete was a

violation of the public policy embedded in Rule 5.6.  The court

held that while it agreed that public policy favors a client's

access to an attorney of choice: 

		"It would be illogical to expect law firms to

pay out large sums of cash to departing

lawyers while fearing that their cash flow

will be threatened by competing lawyers and

the loss of potential clients.  Implicit in

the retirement benefits exception, therefore,

is the notion that the public's interest in

fostering liberal competition among

practitioners must be balanced against a law

firm's interest in maintaining a steady income

flow for the purpose of providing former

members with substantial remuneration upon

retirement."  Schoonmaker, 252 Conn. at 440, 747 A.2d at 1031.  

In the instant case, we find, reading and interpreting MBP's

Restated Plan regarding retirement benefits in light of Rule

5.6(a), the proper balance between the public's interest in choice

and a law firm's interest in maintaining income.  Keeping in mind

the public policy embodied in Rule 5.6, we cannot say that MBP

violated this policy by denying Hoff retirement benefits.  Hoff

relinquished retirement benefits from MBP by resigning from the

firm and continuing to practice law. 

	Hoff next argues that the provision in MBP's Restated Plan is

unreasonably broad.  He argues that the noncompetition provision in

the Plan is overbroad in that it is worldwide in its application, is universal in both the nature of the law practice it prohibits

and the clients to which it applies, and is unlimited in time. 

Hoff contends that even assuming the general enforceability of the

provision in light of the retirement benefits exception, the

provision must still meet a "reasonableness requirement."

	Cited by Hoff, the Williams & Montgomery, Ltd. court addressed a law firm's strict noncompetition agreement.  Here, Hoff seems to

draw our attention to the portion of the opinion which addresses

whether the defendant acquired any confidential information from

his clients and whether that is protected under the firm's

noncompetition agreement.  Williams & Montgomery, Ltd., 195 Ill. App. 3d at 553-54.  We do not find Williams & Montgomery, Ltd. instructive or helpful.  Hoff has not provided this court with any

case addressing an overbroad retirement benefits provision in a law

firm employment agreement.  Furthermore, we are not persuaded by

Hoff's references to cases relied upon by MBP.  Hoff notes that

many of the cases, cited by both parties, dealt with noncompete

clauses and provisions that were limited in time and scope.  

	In his brief, Hoff states that the "discretion provided to

[MBP] in the Restated Plan, in effect, gives the firm the power to

control a withdrawing partner's practice of law and the clients'

right to choose counsel in violation of the public policy

underlying Rule 5.6(a)."  We find this to be a vast overstatement. 

MBP's Plan, in relevant part, states that in the event a partner

retires from the firm and chooses to continue to practice law, he or she will be denied retirement benefits.  A former partner is

free to practice law and clients are not restricted in their choice

of counsel.  The Plan gives the retiring partner the choice between

continuing to practice law and receiving retirement benefits. 

Because this provision is adequately protected by Rule 5.6(a), we

find it does not require restrictive language addressing time,

place or scope of future practice.  The cases that have

specifically addressed the issues of time, place and scope are

cases that interpret noncompetition provisions, not provisions

addressing retirement benefits.  See Stevens, 289 Ill. App. 3d at 998-99.  We find that the retirement provision in MBP's Restated

Plan is not unreasonably broad.

	Hoff's final argument is that he is entitled to a trial on the

issues of whether he has materially competed with MBP and whether

MBP can reasonably refuse to determine that any alleged damage to

it caused by Hoff has ended.

	First, Hoff asks us to read together sections 3.2 and 7.5(a)

of MBP's Restated Plan.  As discussed in some detail above, section 3.2 deals with retirement benefits.  Section 7.5(a) addresses

conditions and limitation relating to retirement benefits.  Section

7.5(a) was not argued before the lower court.  Nevertheless, Hoff

uses this section to present this court with hypothetical

circumstances that are meant, we believe, to illustrate how Hoff's

practice of law subsequent to his retirement from MBP may

constitute a "material competition" with the firm.  Hoff suggests that this analysis would be relevant to whether he should receive

retirement benefits from his former firm.  Hoff cites no case law

that addresses this issue.  Thus, the issue is waived.  Failure to

cite relevant authority is in violation of Supreme Court Rule 341

and results in waiver of the issue on appeal.  188 Ill. 2d R.

341(e)(7).  Sinclair v. Berlin, 325 Ill. App. 3d 458, 468, 758 N.E.2d 442 (2001).  Furthermore, we fail to see how this argument

is relevant to MBP's denial of Hoff's retirement benefits.

	Second, Hoff argues that a trier of fact should determine

whether any alleged damage to the firm by Hoff's law practice in

the same market as MBP has been cured by time.  Again, Hoff cites

section 7.5(a) of the Restated Plan.  Hoff notes in his brief that

under section 7.5(a), a former partner, collecting retirement

benefits, may have these benefits suspended in the event the firm

determines there the former partner is materially competing with

MBP.  If the prohibited activity of the former partner ends and

damage to the firm is cured, the firm may continue retirement

benefits to the former partner.  On appeal, Hoff argues that he is

entitled to a trial on the issue of whether any alleged damage he

has caused to the firm has now been cured.  Hoff cites no case law

to support his contention.  As pointed out above, the issue is

therefore waived.  Sinclair, 325 Ill. App. 3d at 468.  More importantly, Hoff was never granted retirement benefits in the

first place and section 7.5(a) is, therefore, inapplicable to him.

	The trial court's granting of MBP's motion to dismiss is affirmed.

	Affirmed.

	BURKE, P.,J., Anaand HOCAHILL, J., concur.