1 

NOTICE

Decision filed 08/09/06. The text of 

this decision may be changed or 

corrected prior to the filing of a 

Petition for Rehearing or the 

disposition of the same.

 NO. 5-05-0270 

 IN THE 

 APPELLATE COURT OF ILLINOIS 

 FIFTH DISTRICT 

________________________________________________________________________ 

LOUIE HOUSMAN and ALBERT ) Appeal from the 

JOHNSON, JR., ) Circuit Court of 

) Alexander County. 

 Plaintiffs-Appellants, ) 

) 

v. ) No. 02-CH-021 

) 

DANA ALBRIGHT, DEBORAH ) 

GUETTERMAN, DAVID JACKSON, ) 

and GEOFFREY SMITH, ) 

) 

 Defendants-Appellees, ) 

) 

and ) 

) 

WATERFRONT SERVICES COMPANY, ) Honorable 

) William J. Thurston, 

 Nominal Defendant-Appellee. ) Judge, presiding. 

________________________________________________________________________ 

JUSTICE HOPKINS delivered the opinion of the court: 

The plaintiffs, Louie Housman and Albert Johnson, Jr., appeal from an order of the 

circuit court of Alexander County dismissing the shareholders' derivative complaint that they 

filed against the defendants, Dana Albright, Deborah Guetterman, David Jackson, and 

Geoffrey Smith, the president of the board of directors and the chief executive officer of 

Waterfront Services Company (Waterfront), in their capacities as Waterfront's board of 

directors (Board). For the following reasons, we reverse the circuit court's dismissal of the 

plaintiffs' complaint and remand for further proceedings consistent with this opinion. 

 FACTS 

Housman worked for Waterfront, a Delaware corporation, from June 1973 to June 
2 

2002. Johnson worked for Waterfront from September 1984 to January 2002. In June of 

2002, Smith fired Housman and other employees in retaliation for their support for and 

activities on behalf of the Laborers' International Union of North America, Local 773, AFLCIO (Union). Housman, other discharged Union employees, and the Union filed suit against 

Smith and Waterfront for unfair labor practices in violation of the National Labor Relations 

Act (29 U.S.C.'151 et seq. (2000)). An administrative law judge heard the case and ordered 

that Housman and other discharged employees be reinstated to their former positions and be 

compensated for lost wages. Waterfront Services Co., No. 14-CA-27001 (N.L.R.B. Div. of 

Judges December 12, 2002). On December 19, 2003, a three-member panel of the National 

Labor Relations Board affirmed the decision. Waterfront Services Co., 340 N.L.R.B. 1305 

(2003). 

Housman and Johnson participated in Waterfront's "Employee Stock Ownership Plan" 

(ESOP). Each participant received an annual "Individual Report of Benefits Statement" 

showing his account balance and the number of shares allocated to his account. The most 

recent statement provided to this court shows that on May 31, 2003, Housman's stock 

account had a balance of $521,387.56. The report stated: 

"The stock portion represents 120.02476 shares of Waterfront Services 

Company Stock. You are 100% vested in your total account balance ***. This means 

you have a vested interest of $521,387.56. Your shares represent participation in the 

ownership and success of Waterfront Services Company." 

On the same date, Johnson's statement showed an account balance of $34,828.15 and noted: 

"The stock portion represents 8.01753 shares of Waterfront Services Company 

Stock. You are 100% vested in your total account balance ***. This means you have 

a vested interest of $34,828.15. Your shares represent participation in the ownership 

and success of Waterfront Services Company." 
3 

The ESOP's assets were placed in a trust and invested primarily in shares of 

Waterfront common stock. The ESOP gave the trustee, who was appointed and could be 

removed by the Board, the authority to administer the trust. The trustee was responsible for 

holding and investing the trust assets in shares of company stock. 

In 1991, the ESOP's trustee purchased all the stock from the company's stockholders. 

The purchased stock was held in a special account known as the "ESOP Suspense Account" 

and was used as collateral for the ESOP's promise to pay the selling stockholders the agreedupon purchase price. As the selling stockholders were paid, the ESOP suspense account 

released shares of the company stock and allocated them to the individual ESOP accounts for 

all the active participants. The company made cash contributions to the ESOP trust, which 

held all the assets of the ESOP, in amounts sufficient to permit the trustee to make 

installment payments due to the selling stockholders. The amount of company stock released 

from the ESOP suspense account was proportional to the payments made during the year to 

the selling stockholder. Each year, an independent appraiser valued the company stock that 

was held in the ESOP. The account was adjusted to reflect allocations of company stock 

income (including dividends or other credits paid with respect to the shares of stock credited 

to each account), expenses, and losses. Trust income was allocated, and losses were charged, 

to each account in the proportion that the value of the account had to the value of all the 

participants' accounts. 

The ESOP specifically stated that a participating employee's interest in the ESOP was 

invested in shares of company stock held for the employee's benefit by the trustee. The 

"Committee" had the right to vote and exercise other rights of a company stockholder. In the 

event of a corporate matter involving a merger or consolidation, recapitalization, 

reclassification, liquidation, dissolution, or sale or transfer of substantially all the assets of 

the company, the participating employee was entitled to direct the trustee how to vote the 
4 

company stock allocated to his or her account. The ESOP allowed the participating 

employees to sell their stock to the company if they notified the company in writing. 

On October 3, 2002, the plaintiffs filed the initial verified shareholders' derivative 

complaint alleging that Smith had engaged in a scheme of systematic corporate looting and 

self-dealing by using Waterfront's assets to purchase items for himself and his friends. The 

plaintiffs made the following allegations against Smith: (1) he awarded a substantial contract 

to a personal friend to construct Waterfront's new corporate headquarters without seeking 

competing bids and without regard for the fact that the friend's construction company had 

never built a structure of the type that Waterfront needed, (2) he used corporate funds to 

purchase a four-wheel vehicle for his personal use, (3) he used corporate funds to purchase 

exercise equipment for a gym that only Smith and his friends could use, and (4) he used 

corporate funds to purchase season tickets for St. Louis Blues hockey games and St. Louis 

Cardinals baseball games that only Smith and his friends used. The complaint alleged that 

Smith accomplished this wrongdoing by stacking the Board with his personal friends and 

Waterfront employees that were loyal to him. The complaint claimed that due to the 

foregoing events, Waterfront suffered financial injury. 

On October 12, 2002, only nine days after the plaintiffs' initial complaint was filed, a 

letter was sent to all Waterfront ESOP participants, alternate payees, and beneficiaries 

receiving benefits, informing them that effective April 1, 2002, the company had converted 

from subchapter C corporate status to subchapter S corporate status. The notice stated that 

all distributions from the plan made on or after April 1, 2002, would be made in cash only 

and that no distributions of company stock would be made. 

In November of 2002, the defendants filed a notice of removal, seeking to remove this 

case to federal court. On February 14, 2003, the United States District Court entered an 

order remanding this case to the state circuit court for a lack of jurisdiction. 
5 

On June 16, 2003, the defendants filed a motion to dismiss the plaintiffs' amended 

shareholders' derivative complaint pursuant to section 2-619 of the Illinois Code of Civil 

Procedure (Code) (735 ILCS 5/2-619 (West 2002)). On February 2, 2004, the circuit court 

dismissed the plaintiffs' amended complaint without prejudice and granted leave to file an 

amended pleading. The court based the dismissal on the plaintiffs' lack of standing as 

equitable stockholders and specifically stated that Delaware law applied to that issue. The 

circuit court also determined that the plaintiffs' claims were not preempted by the Employee 

Retirement Income Security Act of 1974 (ERISA) (29 U.S.C. '1001 et seq. (2000)). 

On March 11, 2004, the plaintiffs filed a verified second amended shareholders' 

derivative complaint, which the circuit court dismissed without prejudice. 

On February 24, 2005, the plaintiffs filed a third amended shareholders' derivative 

complaint, which the circuit court dismissed with prejudice on the ground that the plaintiffs 

lacked standing to sue under Delaware law because they were not equitable stockholders. 

The plaintiffs filed a timely notice of appeal. 

 ANALYSIS 

On appeal, the plaintiffs initially argue that the circuit court erred in dismissing their 

third amended complaint on the basis that they lacked standing as equitable stockholders to 

bring a shareholders' derivative suit. We agree. 

Motions to dismiss pursuant to section 2-619 of the Code (735 ILCS 5/2-619 (West 

2002)) attack the legal sufficiency of the complaint by raising affirmative matter that avoids 

the legal effect of or defeats the claim. Illinois Graphics Co. v. Nickum, 159 Ill. 2d 469, 485 

(1994). The question on a review of a dismissal pursuant to section 2-619 is "whether there 

is a genuine issue of material fact and whether [the] defendant is entitled to judgment as a 

matter of law." Nickum, 159 Ill. 2d at 494. The defendant has the burden of proving the 

affirmative defense relied upon in a section 2-619 motion, and that motion should only be 
6 

granted if the record establishes that no genuine issue of material fact exists. Streams 

Condominium No. 3 Ass'n v. Bosgraf, 219 Ill. App. 3d 1010, 1013-14 (1991). All wellpleaded facts and reasonable inferences are accepted as true. In re Marriage of Diaz, 363 Ill. 

App. 3d 1091, 1094 (2006). However, conclusions of law are not accepted as true. In re 

Marriage of Sullivan, 342 Ill. App. 3d 560, 563 (2003). Thus, the standard of review for a 

dismissal based on section 2-619 is de novo. Feret v. Schillerstrom, 363 Ill. App. 3d 534, 

538 (2006). 

To determine whether the plaintiffs have standing to sue, we must first determine 

whether Illinois law or Delaware law applies. 

Waterfront is a Delaware corporation, and Illinois courts apply the law of the state of 

incorporation. See Spillyards v. Abboud, 278 Ill. App. 3d 663, 667 (1996). Delaware law 

governs any derivative claims brought on the corporation's behalf or any individual claims 

brought by its stockholders. See Seinfeld v. Bays, 230 Ill. App. 3d 412, 420 (1992). 

According to Delaware law, "In any derivative suit instituted by a stockholder of a 

corporation, it shall be averred in the complaint that the plaintiff was a stockholder of the 

corporation at the time of the transaction of which such stockholder complains or that such 

stockholder's stock thereafter devolved upon such stockholder by operation of law." Del. 

Code Ann. tit. 8, '327 (2002). Pursuant to Delaware law, for purposes of instituting a 

derivative action, an "equitable" owner is considered a stockholder with standing to sue. Del. 

Code Ann. tit. 8, '327 (2002); see Harff v. Kerkorian, 324 A.2d 215 (Del. Ch. 1974), 

modified on other grounds, 347 A.2d 133 (Del. 1975). An "equitable owner" or "beneficial 

owner" is defined as follows: 

"1. One recognized in equity as the owner of something because use and title 

belong to that person, even though legal title may belong to someone else; esp., one 

for whom property is held in trust. B Also termed equitable owner. 2. A corporate 
7 

shareholder who has the power to buy or sell the shares, but who is not registered on 

the corporation's books as the owner." (Emphasis in original.) Black's Law 

Dictionary 1130 (7th ed. 1999). 

Although Delaware has not defined "equitable stockholder," the chancery court in 

Delaware, a court with solely equity jurisdiction, has conferred equitable or beneficial 

ownership onto numerous plaintiffs, enabling them to institute shareholders' derivative 

proceedings. See Jones v. Taylor, 348 A.2d 188 (Del. Ch. 1975) (a contract to receive half of 

the stock or the proceeds thereof in a will not yet in effect was sufficient to confer equitable 

standing); Brown v. Dolese, 154 A.2d 233 (Del. Ch. 1959) (the beneficiaries' shares were 

held in the name of a trustee who refused to sue on behalf of the trust), aff'd, 157 A.2d 784 

(Del. 1960); Gamble-Skogmo, Inc. v. Saks, 122 A.2d 120 (Del. 1956) (a stockholder holding 

stock in a margin account was considered an equitable owner); Taormina v. Taormina Corp., 

78 A.2d 473 (Del. Ch. 1951) (the executors and administrators of an estate had equitable 

standing); Rosenthal v. Burry Biscuit Corp., 60 A.2d 106, 112 (Del. Ch. 1948) (equitable 

standing was conferred on the holders of stock represented by street certificates in the names 

of brokers). Additionally, several state and federal jurisdictions, including Delaware, have 

recognized the standing of trust beneficiaries to pursue corporate derivative claims. Silling v. 

Erwin, 881 F. Supp. 236 (S.D. W. Va. 1995); Cassata v. Cassata, 148 A.D.2d 944, 538 

N.Y.S.2d 960 (1989); Edgeworth v. First National Bank of Chicago, 677 F. Supp. 982 (S.D. 

Ind. 1988); Pearce v. Superior Court of Kern County, 149 Cal. App. 3d 1058, 197 Cal. Rptr. 

238 (1983); Jones, 348 A.2d at 191. 

We decline to support an inflexible basis for stockholder identity where the equitable 

owner of the stock is seeking to protect corporate interests, as in the instant case. See 

Rosenthal, 60 A.2d at 112. 

In the case at bar, we find the West Virginia Supreme Court's State ex rel. Elish v. 
8 

Wilson, 189 W. Va. 739, 434 S.E.2d 411 (1993), decision instructive. In Wilson, active 

participants of Weirton Steel's ESOP filed a shareholders' derivative action against the 

corporation and its officers and directors for the breach of fiduciary duties. The defendants 

argued that the plaintiffs lacked standing because West Virginia, the situs of Weirton Steel, 

like Illinois in the instant case, required that the plaintiffs in a derivative suit be stockholders 

of record. The Wilson court determined that Delaware law applied to the controversy due to 

the fact that Weirton Steel was a Delaware corporation and the battle over who could 

participate in a shareholders' derivative suit was a struggle peculiar to the corporation itself. 

The Wilson court then decided that the ESOP beneficiaries were equitable stockholders with 

standing to sue pursuant to Delaware law even if the ESOP trustee also had standing. 

In the instant case, the ESOP specifically stated that a participating employee's interest 

in the ESOP was invested in shares of company stock, which were held for the employee's 

benefit by the trustee. Both Housman and Johnson owned several shares of stock that were 

fully vested and credited to their ESOP accounts. Although the "Committee" had the right to 

vote and exercise other rights of a company stockholder, in the event of a corporate matter 

involving a merger or consolidation, recapitalization, reclassification, liquidation, dissolution, 

or sale or transfer of substantially all the assets of the company, the participating employee 

was entitled to direct the trustee how to vote the company stock allocated to his or her 

account. Moreover, all of Waterfront's stock is owned through the ESOP plan. If the ESOP 

participants are not permitted to participate in a shareholders' derivative suit, no one can sue 

other than the trustee, who refused to sue. We agree with Wilson that the Delaware 

legislature could not have intended such an absurd result. ESOP stockholders must be left 

with some type of recourse if the trustee is unable or unwilling to sue the officers of the 

corporation for a breach of their fiduciary duties. Hence, the ESOP participants in the 

present case are equitable stockholders and have standing to maintain a shareholders' 
9 

derivative suit pursuant to Delaware law. 

The defendants counter that ERISA (29 U.S.C. '1001 et seq. (2000)) preempts state 

law and provides a proper recourse for the ESOP participants in the instant case. We 

disagree. 

According to ERISA's preemption clause, "[ERISA] shall supercede any and all State 

laws insofar as they may now or hereafter relate to any employee benefit plan ***." 29 

U.S.C. '1144(a) (2000). The United States Supreme Court has stated that a state law "relates 

to" an employee benefit plan " 'if it has a connection with or reference to such a plan.' " 

Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 139, 112 L. Ed. 2d 474, 484, 111 S. Ct. 

478, 483 (1990) (quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 97, 77 L. Ed. 2d 490, 

501, 103 S. Ct. 2890, 2900 (1983)). The United States Supreme Court has repeatedly 

acknowledged the reach of the language in order to reinforce Congress's intent to establish an 

area of exclusive federal concern. See California Division of Labor Standards Enforcement 

v. Dillingham Construction, N.A., Inc., 519 U.S. 316, 324, 136 L. Ed. 2d 791, 799, 117 S. Ct. 

832, 837 (1997). The Court has stated: 

"We have long acknowledged that ERISA's pre[]emption provision is 'clearly 

expansive.' [Citation.] It has 

'a "broad scope" [citation] and an "expansive sweep" [citation]; and ... it is 

"broadly worded" [citation], "deliberately expansive" [citation], and 

"conspicuous for its breadth" [citation].' Morales v. Trans World Airlines, Inc., 

504 U.S. 374, 384[, 119 L. Ed. 2d 157, 167, 112 S. Ct. 2031, 2037] (1992)." 

Dillingham Construction, N.A., Inc., 519 U.S. at 324, 136 L. Ed. 2d at 799, 117 S. Ct. 

at 837. 

However, ERISA's preemption provision does not foreclose every state action that 

affects ERISA plans. Atlantis Health Plan, Inc. v. Local 713, 258 F. Supp. 2d 284, 290 
10 

(S.D.N.Y. 2003). In New York State Conference of Blue Cross & Blue Shield Plans v. 

Travelers Insurance Co., 514 U.S. 645, 655, 131 L. Ed. 2d 695, 705, 115 S. Ct. 1671, 1677 

(1995), the United States Supreme Court acknowledged as follows: 

"If 'relate to' were taken to extend to the furthest stretch of its indeterminacy, then for 

all practical purposes pre[]emption would never run its course, for 'really, universally, 

relations stop nowhere' [citation]. But that, of course, would be to read Congress's 

words of limitation as mere sham, and to read the presumption against pre[]emption 

out of the law whenever Congress speaks to the matter with generality." 

Preemption must have its limits because otherwise it would effectively drag into federal court 

"many ordinary state common law causes of action that rightfully fall within the purview of 

adjudication by state courts, as well as state law claims that implicate federal law as ancillary 

issues or defenses that state courts are suitably equipped and concurrently empowered to 

resolveBlitigation that need not add its incremental burden to the federal docket." Atlantis 

Health Plan, Inc., 258 F. Supp. 2d at 291. 

In the instant case, the defendants bear the burden of overcoming the presumption that 

Congress, in enacting ERISA, did not intend to supplant state law, especially traditional areas 

under state control, such as corporate law. See In re World Trade Center Disaster Site 

Litigation, 270 F. Supp. 2d 357, 367 (S.D.N.Y. 2003), aff'd on other grounds, 414 F.3d 352 

(2d Cir. 2005). As long as a state law " ' "does not affect the structure, the administration, or 

the type of benefits provided by an ERISA plan, the mere fact that the [law] has some 

economic impact on the plan does not require that the [law] be invalidated." ' " Airparts Co. 

v. Custom Benefit Services of Austin, Inc., 28 F.3d 1062, 1065 (10th Cir. 1994) (quoting 

Hospice of Metro Denver, Inc. v. Group Health Insurance of Oklahoma, Inc., 944 F.2d 752, 

754 (10th Cir. 1991) (quoting Rebaldo v. Cuomo, 749 F.2d 133, 139 (2d Cir. 1984))). 

As stated in section 1001(b) of ERISA (29 U.S.C. '1001(b) (2000)), Congress enacted 
11 

ERISA to "protect interstate commerce and the interests of participants in employee benefit 

plans and their beneficiaries, *** by establishing standards of conduct, responsibility, and 

obligation for fiduciaries of employee benefit plans, and by providing for appropriate 

remedies, sanctions, and ready access to the Federal courts." ERISA imposes high standards 

of fiduciary duty upon those responsible for administering an ERISA plan and investing and 

disposing of its assets. The ERISA fiduciary is subject to a strict standard of care (29 U.S.C. 

'1104(a)(1) (2000)), is liable for known breaches by cofiduciaries (29 U.S.C. '1105 (2000)), 

and may not engage in prohibited transactions (29 U.S.C. '1106 (2000)). One of the primary 

purposes for the enactment of ERISA was to establish " 'standards of conduct, responsibility, 

and obligation for fiduciaries of employee benefit plans.' " (Emphasis added.) Ellis v. 

Hollister, Inc., Nos. S-05-559 & S-05-1726, slip op. at 6 (E.D. Cal. April 14, 2006) (quoting 

29 U.S.C. '1001(b) (2000)). 

In Hickman v. Tosco Corp., 840 F.2d 564, 566 (8th Cir. 1988), the defendants, who 

were both company executives and plan fiduciaries, refused to allow the plaintiffs to remain 

on the payroll after the plant was sold so they could become eligible for early retirement 

benefits. The plaintiffs sued and argued that the defendants had a duty as plan fiduciaries to 

act in a manner that was most beneficial to the plan participants. In Hickman, the court 

determined that the defendants were not subject to ERISA's fiduciary duty requirements 

because their action was a " 'day-to-day corporate business transaction' " made in their 

capacity as corporate officers, not as plan administrators. Hickman, 840 F.2d at 566 (quoting 

Phillips v. Amoco Oil Co., 614 F. Supp. 694, 718 (N.D. Ala. 1985), aff'd, 799 F.2d 1464 

(11th Cir. 1986)). The Hickman court held, "ERISA does not prohibit an employer from 

acting in accordance with its interests as employer when not administering the plan or 

investing its assets." Hickman, 840 F.2d at 566; see also Adams v. LTV Steel Mining Co., 

936 F.2d 368, 370 (8th Cir. 1991); Berger v. Edgewater Steel Co., 911 F.2d 911, 918-19 (3d 
12 

Cir. 1990); Amato v. Western Union International, Inc., 773 F.2d 1402, 1416-17 (2d Cir. 

1985); United Paperworkers International Union v. Jefferson Smurfit Corp., 771 F. Supp. 

992, 999 (E.D. Mo. 1991), aff'd, 961 F.2d 1384 (8th Cir. 1992); Moehle v. NL Industries, 

Inc., 646 F. Supp. 769, 779 (E.D. Mo. 1986), aff'd, 845 F.2d 1027 (8th Cir. 1988). 

In Martin v. Feilen, 965 F.2d 660, 666 (8th Cir. 1992), the court concluded that the 

Hickman analysis applied with equal force when the ERISA plan was an ESOP. The Martin

court stated that virtually all of an employer's significant business decisions affect the value 

of its stock and the benefits that ESOP plan participants will ultimately receive. Martin, 965 

F.2d at 666. However, pursuant to section 1104 of ERISA (29 U.S.C. '1104 (2000)), 

ERISA's fiduciary duties attach only to transactions that involve investing the ESOP's assets 

or administering the plan. Martin, 965 F.2d at 666; accord Canale v. Yegen, 782 F. Supp. 

963, 967 (D.N.J. 1992). In fact, the Martin court correctly noted that a broader rule would 

make ESOP fiduciaries virtual guarantors of the financial success of the plan. 

In the instant case, the complaint's allegations do not implicate fiduciary duties arising 

pursuant to ERISA. The complaint did not allege that the defendants mismanaged the 

ERISA plan or that the trust was directly involved in any improper transactions. 

Additionally, the complaint shows that the plaintiffs' claim has nothing to do with regulating 

the type of benefits or the terms of the plan; it does not create reporting, disclosure, funding, 

or vesting requirements for the plan; it does not affect the calculation of benefits; and it is not 

a common law rule designed to rectify faulty plan administration. See Airparts Co., 28 F.3d 

at 1065. The plaintiffs in the instant case brought this action against the defendants in their 

separate capacities as the officers and directors of the corporation, not in their capacities as 

plan fiduciaries. See Sommers Drug Stores Co. Employee Profit Sharing Trust v. Corrigan 

Enterprises, Inc., 793 F.2d 1456, 1465 (5th Cir. 1986) (the court recognized that the fiduciary 

duties of a corporate director coexisted with the duties entrusted to an ERISA plan fiduciary 
13 

but also existed independently from the plan itself); Richmond v. American System Corp., 

792 F. Supp. 449 (E.D. Va. 1992) (the court recognized that even though the fiduciary duties 

of state corporate law and ERISA are parallel, they were independent in a shareholders' 

derivative action). 

In the instant case, the plaintiffs alleged that Smith diminished Waterfront's stock 

value through self-dealing and waste in the day-to-day operations of the company and that 

the remaining defendants did nothing to protect the stockholders. ERISA does not create 

fiduciary duties for day-to-day operations even though they inevitably affect the beneficiaries 

of the ESOP. See Martin, 965 F.2d at 665-66. In summary: 

"ERISA preempts state laws that impinge or encroach upon federal control 

over the regulation or administration of covered plans. [Citation.] But, curbing the 

breadth of the statute, preemption does not extend to state laws that have only a 

'tenuous, remote, or peripheral connection with covered plans, as is the case with 

many laws of general applicability.' [Citations.]" (Emphasis added.) Atlantis Health 

Plans, Inc., 258 F. Supp. 2d at 292. 

 CONCLUSION 

For the foregoing reasons, the judgment of the circuit court of Alexander County 

dismissing the plaintiffs' third amended shareholders' derivative complaint with prejudice is 

reversed, and the cause is remanded for further proceedings consistent with this opinion. 

Reversed; cause remanded. 

GOLDENHERSH and CHAPMAN, JJ., concur. 
 NO. 5-05-0270 

 IN THE 

 APPELLATE COURT OF ILLINOIS 

 FIFTH DISTRICT 

___________________________________________________________________________________

LOUIE HOUSMAN and ALBERT ) Appeal from the 

JOHNSON, JR., ) Circuit Court of 

) Alexander County. 

 Plaintiffs-Appellants, ) 

) 

v. ) No. 02-CH-021 

) 

DANA ALBRIGHT, DEBORAH ) 

GUETTERMAN, DAVID JACKSON, ) 

and GEOFFREY SMITH, ) 

) 

 Defendants-Appellees, ) 

) 

and ) 

) 

WATERFRONT SERVICES COMPANY, ) Honorable 

) William J. Thurston, 

 Nominal Defendant-Appellee. ) Judge, presiding. 

___________________________________________________________________________________

Opinion Filed: August 9, 2006 ___________________________________________________________________________________

Justices: Honorable Terrence J. Hopkins, J. 

Honorable Richard P. Goldenhersh, J. 

Honorable Melissa A. Chapman, J. 

Concur 

___________________________________________________________________________________

Attorneys Seth D. Rigrodsky, Jennifer K. Hirsh, Milberg Weiss Bershad & Schulman LLP, 

for One Pennsylvania Plaza, New York, NY 10119; Ralph N. Siammi, Milberg Weiss 

Appellants Bershad & Schulman LLP, 919 N. Market Street, Suite 411, Wilmington, DE 19801; 

Mark A. Kochan, Kochan & Kochan, 121 West Cherry Street, Herrin, IL 62948 

___________________________________________________________________________________

Attorneys Eric D. Martin, Blackwell Sanders Peper Martin LLP, Mark Twain Plaza One, 

for 101 W. Vandalia Street, Suite 320, Edwardsville, IL 62025; Jeffrey A. Goffinet, 

Appellees Brandon, Schmidt, Goffinet & Solverson, 916 West Main Street, P.O. Box 3898, 

Carbondale, IL 62902-3898 ___________________________________________________________________________________