Court Opinion

ID: 9349426
Source: CourtListenerOpinion
Date Created: 2022-12-21 21:02:34.811724+00
Date Added: 2024-06-11T16:44:54.418471
License: Public Domain

2022 IL App (1st) 211352-U
                                            No. 1-21-1352
                                    Order filed December 21, 2022
                                                                                       Third Division

 NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the
 limited circumstances allowed under Rule 23(e)(1).
 ______________________________________________________________________________
                                     IN THE
                         APPELLATE COURT OF ILLINOIS
                                 FIRST DISTRICT
 ______________________________________________________________________________

 ANDREW J. FILIPOWSKI, LARRY J. FREEDMAN,                       )
 MICHAEL CULLINANE, PAUL HUMENANSKY,                            )   Appeal from the
 PAUL TATRO, and ANDREW WRIGHT,                                 )   Circuit Court of
                                                                )   Cook County.
           Plaintiffs-Appellants,                               )
                                                                )   No. 14 CH 20819
     v.                                                         )
                                                                )   Honorable
 MORGAN, LEWIS & BOCKIUS, LLP,                                  )   Eve M. Reilly,
                                                                )   Judge Presiding.
           Defendant-Appellant.                                 )

           JUSTICE BURKE delivered the judgment of the court.
           Justices McBride and D.B. Walker concurred in the judgment.

                                              ORDER

¶1        Held: We affirm the judgment of the circuit court granting defendant’s motion for
                summary judgment. We reject plaintiffs’ contention that the court erred in finding
                that their claims were time-barred and we find that plaintiffs failed to demonstrate
                that defendant fraudulently concealed the cause of action to toll the running of the
                limitations period.

¶2        This case arises following the circuit court’s grant of summary judgment in favor of

defendant Morgan, Lewis & Bockius, LLP on the claims of plaintiffs, Andrew J. Filipowski, Larry
No. 1-21-1352

J. Freedman, Michael Cullinane, Paul Humenansky, Paul Tatro, and Andrew Wright, for

conspiracy and aiding and abetting. Plaintiffs’ claims were based on a nationwide tax fraud scheme

conducted by accounting firm BDO Seidman, LLP (n/k/a BDO USA, LLP) (“BDO”) in the early

2000s. BDO marketed a tax shelter strategy directed at high-income clients, like plaintiffs. At the

time BDO executives were marketing and implementing the tax scheme, however, the tax

executives knew that the strategy was likely illegal. Plaintiffs purchased these tax solutions from

BDO in 1999. In the following years, plaintiffs were investigated by the IRS and suffered various

losses based on their reliance on BDO’s illegal tax strategy. BDO was also investigated by the

Internal Revenue Service (“IRS”) and the United States Department of Justice (“DOJ”), and

several BDO executives were indicted for their role in the tax scheme.

¶3     Plaintiffs alleged that while BDO was marketing and implementing this illegal tax strategy,

BDO executives retained defendant to provide them with a falsified legal “opinion” that the tax

shelters were valid and that BDO executives would not be subject to civil or criminal liability for

implementing the tax solutions. Plaintiffs maintained that from the outset defendant knew that

BDO’s tax scheme was illegal and could subject BDO executives to criminal liability. Plaintiffs

alleged that defendant also knew that BDO clients, like plaintiffs, could suffer injuries. Plaintiffs

contended that defendant nonetheless continued to aid BDO in providing legal cover for its

executives and failed to inform plaintiffs of the likely illegal nature of their transactions.

¶4     Plaintiffs filed suit against defendant in December 2014 alleging that defendant aided and

abetted BDO’s breach of fiduciary duty, and that defendant and BDO conspired to conceal the

criminal and fraudulent actions of BDO executives. Defendant filed a motion for summary

judgment contending that plaintiffs’ claims were time-barred by the statute of limitations and the

statute of repose because the complained-of conduct occurred more than a decade before plaintiffs

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No. 1-21-1352

filed their complaint. Plaintiffs responded that the limitations period should be tolled because

defendant fraudulently concealed plaintiffs’ cause of action. The circuit court granted defendant’s

motion finding that plaintiffs knew or should have known of their cause of action in 2005 or 2006,

but waited until December 2014 to file this complaint, and that defendant did not fraudulently

conceal the cause of action such that the limitations period could be tolled. For the reasons that

follow, we affirm the judgment of the circuit court.

¶5                                       I. BACKGROUND

¶6                                     A. Plaintiffs’ Complaint

¶7     On December 30, 2014, plaintiffs filed their complaint, and subsequently filed an amended

complaint. In their amended complaint, plaintiffs alleged that defendant knowingly aided, abetted,

and conspired with BDO partners who engaged in a criminal fraud scheme with BDO’s tax

planning business. Plaintiffs contended that BDO retained defendants to advise them concerning

their exposure to criminal liability as a result of a tax strategy BDO marketed to clients, including

plaintiffs. In 1999, BDO’s Tax Solutions Group sold plaintiffs the “Sentinel Transaction,” which

was a type of tax shelter. In 2000, BDO issued tax opinion letters to plaintiffs confirming the

legitimacy of the Sentinel Transaction. Plaintiffs maintain that at the time BDO issued these letters,

BDO and the Tax Solutions Group knew the Sentinel Transaction was an illegal tax shelter scheme.

In October 2000, BDO prepared 1999 tax returns for each plaintiff, which claimed losses based on

the use of the Sentinel Transaction.

¶8     Plaintiffs contended that in February 2000, BDO executives contacted defendant to

investigate BDO’s tax solutions “and to provide some sort of cover to use to minimize or eliminate

their civil and criminal exposure when the IRS and clients eventually learned what BDO was

doing.” Plaintiffs asserted that while investigating BDO’s potential liability, defendant concealed

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No. 1-21-1352

the truth by conferring only with select BDO executives. Plaintiffs maintained that defendant

quickly discovered that BDO’s Sentinel Transaction would likely be disallowed and expose clients

to tax penalties. Nonetheless, defendant did not inform BDO leadership of this finding, and instead

drafted a “legal opinion” with a “pre-determined conclusion of ‘no guilt’—in an attempt to

whitewash the Tax Solutions Group Partners’ actions regarding the Sentinel Transaction.”

Plaintiffs contended that defendant’s wrongful conduct exposed plaintiffs to liability for back

taxes, penalties, interest, and associated fees and costs, as well as substantial legal fees.

¶9      The IRS, a United States Senate subcommittee, and the DOJ all began investigating BDO

in the early 2000s. In December 2000, the IRS notified BDO that it was investigating BDO’s

promotion of tax shelters like the Sentinel Transaction. In 2002, the IRS issued audit notices to

each plaintiff with respect to their 1999 tax returns prepared by BDO. The IRS also notified each

plaintiff that it had disallowed the losses that were created as part of the Sentinel Transaction,

resulting in an increase in the 1999 taxes for each plaintiff, as well as potential penalties. In 2002

and 2003, the IRS commenced two different investigations of BDO’s tax shelter activities,

including the Sentinel Transaction.

¶ 10    Plaintiffs asserted that they did not know that BDO knew its “tax solutions” were illegal

until BDO’s partners were indicted and began pleading guilty in 2009. On December 30, 2009,

BDO brought suit against defendant for, among other things, breach of fiduciary duty and fraud.

Plaintiffs contended that it was at this point that they first learned of defendant’s role in BDO’s

tax scheme.

¶ 11    Plaintiffs raised two claims in their complaint. The first count was for aiding and abetting

a breach of fiduciary duty. In this count, plaintiffs alleged that BDO owed them a fiduciary duty

as their accountant and trusted advisor. Plaintiffs contended that defendant was aware of BDO’s

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No. 1-21-1352

fiduciary duties to plaintiffs, and knew that BDO was violating these duties. Plaintiffs maintained

that defendant knew that BDO was marketing the Sentinel Transaction to clients at the time they

were advising BDO executives regarding their exposure to criminal liability with respect to the

Sentinel Transaction. Plaintiffs further alleged that defendant helped BDO “cloak[] the Sentinel

Transaction in particular and BDO’s tax shelter practice in general with an aura of legitimacy,”

which allowed BDO executives to continue to market and implement the Sentinel Transaction and

other similar transactions. Plaintiffs contended that defendant benefitted from this arrangement by

collecting substantial fees from BDO. Plaintiffs maintained that defendant could have avoided

liability if it had not given misleading advice to BDO executives regarding the legitimacy of the

Sentinel Transaction or if it had disclosed the illegal and fraudulent nature of BDO’s tax shelter

practice to other BDO executives who were not part of the Tax Solutions Group. Plaintiffs asserted

that defendant’s failure to do so caused injury to plaintiffs and other BDO clients.

¶ 12   In their second count, plaintiffs raised a claim for conspiracy. Similar to their first count,

plaintiffs alleged that defendant knowingly concealed criminal and fraudulent acts by BDO

executives. Plaintiffs contended that if defendant had revealed the liabilities arising from BDO’s

tax practices to BDO’s board of directors, BDO would have stopped marketing and implementing

the illegal transactions, and would have notified BDO clients, including plaintiffs.

¶ 13                            B. Defendant’s Motion to Dismiss

¶ 14   Defendant filed a motion to dismiss plaintiffs’ complaint pursuant to section 2-615 of the

Illinois Code of Civil Procedure (Code) (735 ILCS 5/2-615 (West 2014)). In its motion, defendant

contended that plaintiffs’ claims should be dismissed because they were barred by the six-year

statute of repose under section 13-214.3(c) of the Code (735 ILCS 5/13-214.3(c) (West 2014)).

That section provides that any “action for damages based on tort, contract, or otherwise (i) against

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No. 1-21-1352

an attorney arising out of an act or omission in the performance of professional services” must be

commenced within six years after the date on which the act or omission occurred. 735 ILCS 5/13-

214.3(b), (c) (West 2014). Defendant contended that, in their complaint, plaintiffs alleged that

defendant rendered legal advice to BDO in 2000. Defendant asserted that plaintiffs were therefore

required to file their lawsuit against defendant by 2006. Defendant maintained that plaintiffs’

claims were therefore time-barred where plaintiffs initiated this lawsuit in 2014.

¶ 15      Defendant further contended that plaintiffs’ claims were also barred by the two-year statute

of limitations of section 13-213.3(b) of the Code. 735 ILCS 5/13-214.3(b) (West 2014). That

section provides that an action against an attorney must be commenced within two years from the

time the person bringing the action knew or reasonably should have known of the injury for which

the damages are sought. Id. Defendant contended that plaintiffs were put on notice that BDO’s tax

products were problematic in 2000, and plaintiffs admitted that in 2009 they knew BDO had filed

a lawsuit against defendant. Defendant maintained that plaintiffs’ claims were therefore time-

barred.

¶ 16                            1. Plaintiffs’ Second Amended Compliant

¶ 17      Plaintiffs subsequently filed a second amended complaint. The second amended complaint

largely maintained the facts and allegations from plaintiffs’ previous complaints, but added

allegations to address the arguments made in defendant’s motion to dismiss. Plaintiffs alleged that

they could not have reasonably discovered defendant’s role is BDO’s unlawful conduct until 2012

at the earliest. Plaintiffs contended that in December 2009, new BDO executives caused BDO to

file suit against defendants in the superior court of the District of Columbia. The suit was based

on, among other things, defendant’s concealment of the liabilities for the Tax Solutions Group.

Plaintiffs asserted that in June 2012, the superior court entered an order of summary judgment in

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No. 1-21-1352

favor of defendant finding that BDO “ ‘knew’ ” of defendant’s “true views concerning criminal

exposure” from BDO’s tax business before 2007, and that BDO’s claims were therefore time-

barred. Plaintiffs contended that: “In fact, none of the plaintiffs knew, or could reasonably

discover, [defendant’s] role in BDO’s now-admitted ‘unlawful and fraudulent’ conduct until

sometime in 2012 at the earliest.”

¶ 18   Plaintiffs also alleged that the statute of repose and statute of limitations under section 13-

214.3 should not apply because defendant’s advice to BDO did not constitute “legal advice or

professional services” under that section. Plaintiffs contended that defendant’s assistance in

furthering BDO’s criminal and fraudulent enterprise could not be considered the provision of legal

services. Plaintiffs also alleged that defendant participated in efforts to “fraudulently conceal” its

“true views” from other BDO executives, the government, and BDO clients.

¶ 19             2. Defendant’s Motion to Dismiss the Second Amended Complaint

¶ 20   Defendant filed a motion to dismiss plaintiffs’ second-amended complaint. Defendant

again asserted that plaintiffs’ claims were barred by both the six-year statute of repose and the two-

year statute of limitations under section 13-214.3 (735 ILCS 5/13-214.3(b), (c) (West 2014)).

Defendant contended that plaintiffs’ claims that defendant was not rendering professional services

to BDO did not have any basis in law. Defendant maintained that by plaintiffs’ own admissions,

defendant performed substantial legal services for BDO, including performing a risk analysis for

the Sentinel Transaction and drafting a written opinion concerning potential criminal liability for

BDO executives. Defendant asserted that the nature of the services provided determines whether

the services were legal services, and the services defendant provided to BDO were, by their very

nature, legal services.

                                                -7-
No. 1-21-1352

¶ 21   Defendant therefore contended that plaintiffs’ claims were extinguished by the six-year

statute of repose. Defendant maintained that the events giving rise to plaintiffs’ claims occurred in

2000, or at the latest in 2003. Defendant asserted that therefore when plaintiffs filed their complaint

in December 2014, their claims were time-barred. Defendants also contended that plaintiffs’

claims were barred by the two-year statute of limitations. Defendants maintained that by plaintiffs’

own admissions, they discovered defendant’s role in BDO’s fraud scheme at the latest in December

2009 when BDO filed suit against defendant alleging claims of legal malpractice. Defendant

asserted that at a minimum this filing put plaintiffs on notice that their injuries may have been

wrongly caused by defendant.

¶ 22   Defendant also contended that plaintiffs had failed to sufficiently plead a claim for

fraudulent concealment to toll the statute of limitations or statute of repose. Defendant asserted

that plaintiffs could not allege that a fiduciary duty existed between them and defendant, and

therefore defendant had no duty to disclose anything to plaintiffs. Defendant stated that plaintiffs

were “complete strangers” and defendant did not owe them a duty of care. Defendant also

maintained that plaintiffs failed to plead any affirmative acts by defendant that were designed to

prevent plaintiffs’ discovery of their cause of action.

¶ 23   Finally, defendant contended that plaintiffs’ complaint should be dismissed pursuant to

section 2-615 of the Code (735 ILCS 5/2-615 (West 2014)) because plaintiffs failed to adequately

state a claim for civil conspiracy or aiding and abetting.

¶ 24                      3. Plaintiffs’ Response to the Motion to Dismiss

¶ 25   In response, plaintiffs contended that their claims should not be dismissed under section

13-214.3 because defendant’s participation in and assistance of an “ ‘unlawful and fraudulent’ ”

criminal conspiracy was not the provision of “ ‘professional services.’ ” Plaintiffs maintained that

                                                 -8-
No. 1-21-1352

section 13-214.3 was therefore inapplicable. Plaintiffs also contended that they adequately pled

fraudulent   concealment.     Plaintiffs   asserted   that   BDO    made     numerous     fraudulent

misrepresentations to plaintiffs and BDO owed a fiduciary duty to plaintiffs. Plaintiffs contended

defendant was liable for BDO’s fraudulent concealment because they participated in or aided and

abetted the fraudulent concealment.

¶ 26   Plaintiffs maintained that because section 13-214.3 was inapplicable, and because plaintiffs

adequately alleged fraudulent concealment, the time limitation of section 13-215 would apply to

their claims. See 735 ILCS 5/13-215 (West 2014). Under that section, plaintiffs asserted that they

had five years from the “discovery” of their claims to bring the cause of action. Plaintiffs alleged

that they discovered their claims on December 30, 2009, when BDO brought its suit against

defendant. Plaintiffs maintained that this action, filed on December 30, 2014, was therefore timely.

¶ 27   Finally, plaintiffs contended that they adequately stated claims for aiding and abetting and

civil conspiracy.

¶ 28                    4. The Trial Court’s Ruling on the Motion to Dismiss

¶ 29   Following a hearing, the court denied defendant’s motion to dismiss. The court first

rejected plaintiffs’ contention that the limitations period of section 13-215 should apply, and found

that the limitation periods under section 13-214.3 applied. The court relied on the supreme court’s

ruling in Evanston Insurance Co. v. Riseborough, 2014 IL 114271 and this court’s ruling in Ritchie

Capital Management, LLC v. Fredrickson & Byron, PA, 2015 IL App (1st) 142067-U (unpublished

order under supreme court rule 23) in finding that the attorney statute of limitations of section 13-

214.3 applied to a wide variety of actions, including those brought by non-clients. The court found,

however, that plaintiffs had adequately alleged fraudulent concealment in the complaint and

adequately stated causes of action for conspiracy and aiding and abetting. The court stated that it

                                                -9-
No. 1-21-1352

was uncertain whether plaintiffs’ claims would ultimately be successful, but found that there were

“factual issues that can’t be decided on a motion to dismiss.” The court therefore denied

defendant’s motion to dismiss the complaint.

¶ 30                           C. Defendant’s Affirmative Defenses

¶ 31   Defendant also filed an answer and raised numerous affirmative defenses to plaintiffs’

complaint. As relevant here, defendant alleged that plaintiffs’ claims were barred by the doctrine

of in pari delicto, that the statute of repose and the statute of limitations barred plaintiffs’ claims

and there was no fraudulent concealment by defendant, and that plaintiffs’ claims were barred by

contracts or agreements they entered into with BDO.

¶ 32                       D. Defendant’s Motion for Summary Judgment

¶ 33   Defendant subsequently moved for summary judgment on those three affirmative defenses.

In its motion, defendant noted that the court had previously found in denying defendant’s motion

to dismiss that the applicable limitations periods for plaintiffs’ claims were the statute of repose

and statute of limitations in section 13-214.3(b), (c). Defendant alleged that it did “limited legal

work” for BDO in 2000, and thus plaintiffs’ claims, filed 14 years later, were time-barred by that

section. Defendant further contended that plaintiffs’ allegations of fraudulent concealment were

flawed because plaintiffs admitted that defendant was a “complete stranger” to them and therefore

defendant could not have concealed anything from them. Defendant maintained that fraudulent

concealment was also inapplicable because plaintiffs should have known that their tax shelters

were invalid before the limitations period expired in 2006. Defendant noted that plaintiffs had

ample evidence that BDO’s tax shelter business was under investigation by the United States

government in the early 2000s, and three plaintiffs even entered into settlement agreements with

BDO in 2005. Defendant further noted that fraudulent concealment extends the time for a party to

                                                - 10 -
No. 1-21-1352

file suit by five years after the discovery of the concealed cause of action. Defendant asserted that

plaintiffs “discovered” the alleged fraudulent concealment by BDO before December 30, 2009,

based on their numerous correspondences with BDO and the ongoing investigation of BDO by the

federal government.

¶ 34   Defendant also contended that plaintiffs’ claims were barred by the settlement agreements

that they entered into with BDO. Defendant alleged that these settlement agreements purported to

release all of plaintiffs’ claims against BDO and all of plaintiffs’ claims against BDO’s agents or

counsel, which included defendant. Finally, defendant asserted that plaintiffs’ claims were barred

by the doctrine of in pari delicto because plaintiffs knew the tax shelters were shams when they

entered into the transactions.

¶ 35                   1. Plaintiffs’ Response to the Motion for Summary Judgment

¶ 36   Plaintiffs initially filed affidavits pursuant to Supreme Court Rule 191(b) (eff. Jan. 4, 2013)

in response to defendant’s motion for summary judgment. However, the court struck plaintiffs’

affidavits and ordered them to file a response to defendant’s motion. In their response, plaintiffs

contended that their claims were timely filed because BDO and defendant fraudulently concealed

the illegal nature of BDO’s tax shelter transactions until at least December 30, 2009. Plaintiffs

asserted that BDO made numerous misrepresentations to plaintiffs including that the Sentinel

Transaction was valid and legal and that the IRS notices did not apply to plaintiffs’ transactions.

Plaintiffs further contended that BDO, who owed plaintiffs a fiduciary duty, failed to disclose

material facts to plaintiffs including that BDO executives had knowingly created, marketed, and

implemented illegal tax shelters as part of a criminal conspiracy. Plaintiffs alleged that defendant

participated in and assisted BDO’s fraudulent concealment by, inter alia, drafting false and

misleading communications that were sent to BDO’s clients, including plaintiffs, providing BDO

                                               - 11 -
No. 1-21-1352

executives with a legal opinion that falsely claimed that BDO’s tax shelters did not create criminal

liability for BDO and its executives, and concealing material documents from the IRS. Plaintiffs

further asserted that defendant’s actions violated the Rules of Professional Conduct for attorneys.

¶ 37    Plaintiffs maintained that they could not have learned of defendant’s identity until

December 30, 2009, when BDO filed suit against defendant, which was the “first public disclosure

of [defendant’s] identity as a participant in BDO’s illegal and fraudulent tax shelters.” Plaintiffs

further contended that the IRS notices and legal proceedings against BDO did not demonstrate that

plaintiffs discovered or could have discovered their claims against defendant sooner. Plaintiffs

asserted that these factors may have been relevant to their claims against BDO, but had no bearing

on any potential claims they could have against defendant who was unknown to them at the time.

¶ 38    Plaintiffs further contended that their settlement agreement with BDO did not also release

defendant from liability because releases are construed to include only claims contemplated by the

parties to the release and defendant was not specifically identified in the release. Finally, plaintiffs

asserted that their claims were not barred by the doctrine of in pari delicto because defendant’s

superior knowledge and direct participation in the criminal conspiracy meant the parties were not

equally at fault.

¶ 39            2. The Trial Court’s Ruling on the Motion for Summary Judgment

¶ 40    Following a hearing, the court denied defendant’s motion with regard to defendant’s claim

that plaintiffs’ settlement agreement with BDO also released defendant from liability and with

regard to defendant’s claim that in pari delicto barred plaintiffs’ claims. The court stated, however,

that it was going to take the statute of limitations issue under advisement.

¶ 41    The court subsequently issued its ruling in an oral order, which it supplemented with a

written judgment order. In its order, the court found that defendant did not make any

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No. 1-21-1352

misrepresentations to plaintiffs with the intent to deceive them. The court observed that there was

no fiduciary relationship between defendant and plaintiffs that would require them to speak. The

court noted that there was a fiduciary relationship between plaintiffs and BDO, and plaintiffs’

claims were based on defendant’s participation in, and aiding of, BDO’s breach of duty and

criminal tax scheme. The court stated, however, “you cannot aid somebody in concealing that to

which is known.” The court found that plaintiffs were aware of the sham nature of their tax shelters,

by their own admissions, sometime between 2002 and 2006, but certainly by the time they received

notice from the IRS in 2006.1 The court observed that several plaintiffs settled with BDO in 2005.

The court found that even if plaintiffs were not aware of defendant’s existence at this time, they

still had the responsibility to conduct inquiry based on the circumstances known to them at the

time.

¶ 42    The court further stated that fraudulent concealment applies only to fraudulent concealment

of the cause of action, but does not apply to concealment of the identity of the tortfeasor. Relying

on this court’s ruling in Pratt v. Sears Roebuck & Co., 71 Ill. App. 3d 825 (1979), the court found

that when the tortfeasor fraudulently conceals the identity of the tortfeasor, the tortfeasor does not

conceal the fact that the plaintiff suffered an injury, and therefore does not allow the plaintiff an

extension of the limitations period.

¶ 43    The court continued that even if fraudulent concealment applied, it would toll the statute

of limitations only until 2011, but plaintiffs did not file suit until 2014. The court therefore found

that plaintiffs’ claims were time-barred. This appeal follows.

        1
         The court appeared to be referring to the IRS notices that plaintiffs received in 2005, which are
discussed in more detail below.

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No. 1-21-1352

¶ 44                                       II. ANALYSIS

¶ 45   On appeal, plaintiffs contend that the court erred in finding that their claims were barred

by the statute of limitations and the statute of repose and in granting defendant’s motion for

summary judgment. Plaintiffs contend that the statute of limitations and statute of repose in section

13-214.3 apply only to the performance of professional services. Plaintiffs maintain that

defendant’s role in aiding and abetting BDO’s criminal tax scheme could not be considered the

performance of professional services. Plaintiffs assert that therefore the five-year “catch-all”

statute of limitations of section 13-205 of the Code (735 ILCS 5/13-205 (West 2014)) should apply

to their claims, rather than the limitations periods in section 13-214.3.

¶ 46   Plaintiffs further contend that even if the limitations periods in section 13-214.3 apply,

defendant’s fraudulent concealment of plaintiffs’ cause of action tolls the limitations periods.

Plaintiffs maintain that defendant’s identity and role in BDO’s criminal tax scheme was

“unknowable” until BDO filed suit against defendant in December 2009. Plaintiffs contend that

despite the circuit court’s finding to the contrary, the IRS notices and federal government

investigation of BDO in 2005 and 2006 did not put them on inquiry notice of their claims against

defendant because these matters solely concerned BDO and did not mention defendant.

¶ 47                                  A. Summary Judgment

¶ 48   Summary judgment is proper where the pleadings, depositions, admissions, and affidavits

on file, when viewed in a light most favorable to the nonmoving party, reveal that there is no

genuine issue of material fact and that the moving party is entitled to judgment as a matter of law.

General Casualty Insurance Co. v. Lacey, 199 Ill. 2d 281, 284 (2002) (citing 735 ILCS 5/2-1005(c)

(West 2000)). “In determining whether a genuine issue as to any material fact exists, a court must

construe the pleadings, depositions, admissions, and affidavits strictly against the movant and

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No. 1-21-1352

liberally in favor of the opponent.” Gilbert v. Sycamore Municipal Hospital, 156 Ill. 2d 511, 518

(1993). “A triable issue precluding summary judgment exists where the material facts are disputed,

or where, the material facts being undisputed, reasonable persons might draw different inferences

from the undisputed facts.” Adams v. Northern Illinois Gas Co., 211 Ill. 2d 32, 43 (2004). We

review the trial court’s grant of summary judgment de novo. Lacey, 199 Ill. 2d at 284.

¶ 49                          B. Performance of Professional Services

¶ 50   We must first determine whether the services defendant rendered on BDO’s behalf in 2000

constitute the performance of professional services. Section 13-214.3 provides, in pertinent part,

that “[a]n action for damages based on tort, contract, or otherwise (i) against an attorney arising

out of an act or omission in the performance of professional services” must be commenced within

two years from the time the person bringing the action knew or reasonably should have known of

the injury for which damages are sought. (Emphasis added.) 735 ILCS 5/13-214.3(b) (West 2014).

Plaintiffs maintain that this section should not apply in this case because defendant’s conduct

should not be characterized as the performance of professional services. Plaintiffs contend that the

record shows that defendant was not acting as a provider of legal services, but was instead an

active participant in a criminal tax fraud scheme. Plaintiffs assert that under these circumstances

the five-year limitation period of section 13-205 should apply.

¶ 51   Here, the record shows that plaintiffs’ claims against defendant are clearly based on actions

or omissions that arose out of defendant’s performance of professional services for BDO. Our

supreme court has instructed that we should interpret the terms of section 13-214.3 “broadly.”

Riseborough, 2014 IL 114271, ¶ 23. As such, this court has found that the two-year statutory

limitation of section 13-214.3(b) applies even where a plaintiff alleges that an attorney aided and

abetted a third party’s breach of fiduciary duty. See Janousek v. Katten Muchin Rosenman LLP,

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No. 1-21-1352

2015 IL App (1st) 142989. By plaintiffs’ own admissions, BDO executives retained defendant to

evaluate the legality of its tax shelter business, particularly the Sentinel Transaction, which it had

marketed to plaintiffs and other clients. BDO executives desired an opinion from defendant

regarding whether BDO could face criminal or civil liability for having marketed and implemented

the transactions. Defendant also drafted correspondences to BDO clients on BDO’s behalf and

defendant represented BDO in proceedings with the IRS. These undertakings clearly constitute the

provision of professional services.

¶ 52   We find this court’s ruling in Shrock v. Ungaretti & Harris Ltd., 2019 IL App (1st) 181698

instructive. In Shrock, the plaintiff sued the defendant law firm and two of its attorneys for aiding

and abetting one of the firm’s clients in violating an injunction the plaintiff had obtained against

the client. Id. ¶ 1. The circumstances giving rise to the plaintiff’s claims were known to plaintiff

on November 7, 2014, but the plaintiff did not file his complaint against the law firm until

November 18, 2016. Id. ¶¶ 38, 40. The circuit court granted the law firm’s motion to dismiss the

complaint finding that it was barred by the two-year statute of limitations of section 13-214.3. Id.

¶¶ 41-42.

¶ 53   On appeal, the plaintiff contended, inter alia, that section 13-214.3(b) did not apply

because the defendant’s “acts or omissions” were tortious, and were not “ ‘professional services’

“ that the law firm was “ ‘reasonably expected to perform.’ “ Id. ¶ 46. The plaintiff asserted that

the law firm’s acts or omissions included making false representations to the court and the plaintiff.

Id. This court, relying on Riseborough, found that the statute of limitations of section 13-214.3(b)

applied regardless of whether the plaintiff styled the allegations as malpractice or fraud or

conspiracy because the complained-of conduct arose out of the defendants’ performance of their

professional services. Id. ¶ 48.

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No. 1-21-1352

¶ 54     Likewise, federal courts analyzing this statute have found that section 13-214.3(b) “applies

where law firms are alleged to have aided and abetted their client’s malfeasance” and “where law

firms are alleged to have acted fraudulently.” D.A.N. Joint Venture III, L.P. v. Touris, 2020 WL

1445623 at 4 (N.D. Ill. 2020) (citing Schrock, 2019 IL App (1st) 181698); Salon Grp., Inc. v.

Salberg, 2002 WL 1058120, at 2 (N.D. Ill. 2002) (claim based on law firm’s submission of

allegedly fraudulent applications for visas was subject to two-year limitation under section 13-

214.3(b))); see also Kroll v. Cozen O'Connor, 2020 WL 919005, at 4 (N.D. Ill. 2020) (claims

against law firm for malpractice, aiding and abetting fraud, aiding and abetting breach of fiduciary

duty, and fraudulent concealment were subject to two-year limitation under section 13-214.3(b)).

Simply put, BDO retained defendant law firm in its capacity as a law firm. Defendant’s attorneys

performed work for BDO executives in their capacity as attorneys. Plaintiffs may not circumvent

the time limitations of section 13-214.3 simply by stylizing their claims as fraud or conspiracy

where those claims clearly concern the legal work performed by defendant on behalf of BDO.

Schrock, 2019 IL App (1st) 181698, ¶ 48. Accordingly, we find that the limitations periods under

section 13-214.3(b) govern plaintiffs’ claims against defendant here.

¶ 55                      C. Statute of Limitations and Statute of Repose

¶ 56     Having found that plaintiffs’ claims concern the performance of professional service, we

must next determine whether plaintiffs’ claims are time-barred by either the two-year statute of

limitations or the six-year statute of repose of section 13-214.3. 735 ILCS 5/13-214.3(b), (c) (West

2014).

¶ 57     A statute of repose and a statute of limitations are separate statutes that place a limitation

on the time in which a plaintiff has to file his lawsuit. Wisniewski v. Diocese of Belleville, 406 Ill.

App. 3d 1119, 1150 (2011)). “The purpose of a statute of limitation is to discourage the

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No. 1-21-1352

presentation of stale claims and to encourage diligence in the bringing of actions.” Sundance

Homes, Inc. v. County of DuPage, 195 Ill. 2d 257, 265-66 (2001). Generally, a limitations period

begins to run when facts exist that authorize one party to maintain an action against another, i.e.,

when the cause of action accrues. Id. at 266; Wisniewski, 406 Ill. App. 3d at 1150. A statute of

repose, as distinguished from a statute of limitations, extinguishes a cause of action after a fixed

period of time, regardless of when the action accrued. DeLuna v. Burciaga, 223 Ill. 2d 49, 61

(2006). A statute of repose is intended to terminate liability after a defined period of time,

regardless of a potential plaintiff’s lack of knowledge of his or her cause of action. Id.

¶ 58   We observe that plaintiffs do not contend before this court, that their claims were filed

within either the two-year or six-year limitations periods of section 13-214.3. Rather, they contend

that the limitations periods were tolled by BDO and defendant’s fraudulent concealment of their

cause of action. Accordingly, we will address whether plaintiffs’ claims are not time-barred

because fraudulent concealment tolled the limitations periods.

¶ 59                                E. Fraudulent Concealment

¶ 60   Section 13-215 of the Code provides: “[i]f a person liable to an action fraudulently conceals

the cause of such action from the knowledge of the person entitled thereto, the action may be

commenced at any time within 5 years after the person entitled to bring the same discovers that he

or she has such cause of action, and not afterwards.” (Emphasis added.) 735 ILCS 5/13-215 (West

2014). In order to prove a claim for fraudulent concealment, the plaintiff must show:

                “(1) concealment of a material fact, (2) intent to induce a false belief where there

       exists a duty to speak, (3) that the other party could not have discovered the truth through

       reasonable inquiry and relied upon the silence as an indication that the concealed fact did

       not exist, (4) that the other party would have acted differently had it known of the concealed

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No. 1-21-1352

       information, and (5) that its reliance resulted in its injury.” Ashby v. Pinnow, 2020 IL App

       (2d) 190765, ¶ 34 (citing Vandenberg v. Brunswick Corp., 2017 IL App (1st) 170181, ¶

       31).

Plaintiffs’ claim of fraudulent concealment thus raises two questions for this court. First, whether,

as plaintiffs maintain, defendant fraudulently concealed plaintiffs’ cause of action such that the

limitations period should be tolled. Second, if defendant did fraudulently conceal the cause of

action, whether plaintiffs knew or should have known of their cause of action within the limitations

period despite the fraudulent concealment. We will address each of these questions in turn.

¶ 61            A. Whether Defendant Fraudulently Concealed the Cause of Action

¶ 62   Plaintiffs contend that the record shows that BDO made numerous misrepresentations to

plaintiffs that delayed plaintiffs’ ability to discover their cause of action against defendant.

Plaintiffs maintain that these misrepresentations can be imputed to defendant as a coconspirator in

BDO’s scheme. Plaintiffs assert that defendant actively participated in BDO’s fraudulent

concealment by providing BDO executives with knowingly false legal opinions to use as cover for

BDO, drafting misleading communications to BDO clients, and concealing relevant material from

the federal government during the government’s investigation of BDO.

¶ 63   We must first address whether BDO’s alleged fraudulent concealment can be imputed to

defendant. Plaintiffs acknowledge that defendant had limited, if any, contact with plaintiffs prior

to this lawsuit, and therefore could not have made any representations to plaintiffs in order to

prevent them from discovering their cause of action. Plaintiffs also acknowledge that no “special

relationship” existed between defendant and plaintiffs such that defendant’s mere silence would

be sufficient to toll the limitations period. See Wisniewski, 406 Ill. App. 3d at 1154 (explaining

that there is an exception to the general rule that mere silence on the part of the defendant does not

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No. 1-21-1352

amount to fraudulent concealment where there is a “fiduciary or trust or other confidential

relationship between” the parties.).

¶ 64   In support of their contention that defendant is liable for BDO’s fraudulent concealment,

plaintiffs chiefly rely on the supreme court’s ruling in Chicago Park District v. Kenroy, Inc., 78

Ill. 2d 555 (1980). In Kenroy, the plaintiff Chicago Park District sought to acquire a parcel of land

through eminent domain. Id. at 558. In response to a petition filed by the defendants, the Chicago

City Council rezoned the property, driving up the compensation for the taking of the property. Id.

at 558-59. Throughout the eminent domain proceeding and settlement negotiations, the defendants

represented that the property had been properly rezoned. Id. at 559. However, two officers of the

defendant later testified that the rezoning had been secured by means of bribery and fraud,

including paying a city alderman $50,000. Id. The Park District sought damages based on the

improper rezoning, and one of the issues on appeal to the supreme court was whether the Park

District’s complaint was barred by the applicable statute of limitations. Id. at 560.

¶ 65   In addressing the statute of limitations, the supreme court considered whether the Park

District’s cause of action had been tolled by the defendants’ fraudulent concealment of the cause

of action. Id. at 561. The court noted that the alderman who accepted the bribe, who was not a

defendant in the case, owed a fiduciary duty to the Park District. Id. The court recognized that

fraudulent concealment by a person other than the defendant will not generally serve to toll the

statute of limitations. Id. at 563. However, the court found that the alderman was in privity with

the defendants, such that their knowledge or approval of the concealment would be sufficient to

toll the limitations period. Id. at 563-54. The court found that the defendants “intentionally and

deliberately induced” the alderman’s breach of fiduciary duty through bribery. Id. at 564. The court

also found that the defendants actively participated in the fraudulent concealment by making

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No. 1-21-1352

misrepresentations to municipal agencies and departments. Id. The court concluded that the

defendants were therefore “in no better position than [the alderman] to use the statute of limitations

to protect their allegedly ill-gotten gains.” Id.

¶ 66    Here, there is no suggestion that defendant induced BDO’s breach of fiduciary duty.

Rather, by plaintiffs’ allegations, BDO retained defendant in order to help provide cover for

BDO’s alleged ongoing breach of fiduciary duty. Plaintiffs do suggest, however, that defendant

actively participated in BDO’s fraudulent concealment as part of a conspiracy between the parties.

The court in Kenroy found that the plaintiff had sufficiently alleged “the existence of an agency

relationship, privity, or even an actual conspiracy” between the defendants and the alderman. Id.

Under those circumstances, the court found that the alderman’s fraudulent concealment as a

fiduciary could be imputed to the defendants.

¶ 67    Here, plaintiffs likewise allege a conspiracy between defendant and BDO. It is unclear,

however, if Kenroy only applies to the narrow circumstances where a third party induces another’s

breach of fiduciary duty. Plaintiffs do not allege that defendant induced BDO’s breach of fiduciary

duty. Indeed, based on plaintiffs’ allegations, BDO seemed to be the driving force behind the

conspiracy and its own breach of fiduciary duty, with defendant merely a participant in the

conspiracy. We find, however, that in this case it is unnecessary for us to resolve the extent of the

holding in Kenroy. As discussed below, even assuming each misrepresentation made by BDO may

be imputed to defendant, plaintiffs’ claims are nonetheless time-barred by section 13-214.3

because the record shows that plaintiffs should have discovered their cause of action against

defendant through the exercise of ordinary diligence well before December 30, 2009.

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No. 1-21-1352

¶ 68                            B. Whether Plaintiffs Should Have
                                Discovered Their Cause of Action Before
                                December 30, 2009

¶ 69    Plaintiffs maintain that the earliest they could have discovered their cause of action against

defendant was on December 30, 2009, when BDO filed suit against defendant and thus “publicly

disclosed (for the first time) [defendant’s] identity and role in the conspiracy.” Plaintiffs assert that

defendant and BDO’s fraudulent concealment extended up until that date. Plaintiffs therefore

contend that the five-year limitations period of section 13-215 (735 ILCS 5/13-215 (West 2014)

began to run on December 30, 2009, and their complaint in this case, filed exactly five years later

on December 30, 2014, was therefore timely. The operative determination therefore is whether

plaintiffs knew or should have known of their cause of action before December 30, 2009.

¶ 70    In order to prove fraudulent concealment, plaintiffs must show affirmative acts or

representations by defendant that were “designed to prevent and, in fact, did prevent,” plaintiffs

from discovering their claims. Gredell v. Wyeth Laboratories, Inc., 346 Ill. App. 3d 51, 60 (2004).

“As a general rule, mere silence on the part of the defendant and a failure by the plaintiff to learn

of the cause of action are not enough to establish fraudulent concealment.” Wisniewski, 406 Ill.

App. 3d at 1154 (citing Kenroy, 78 Ill. at 555, 561 (1980)). There is an exception to this general

rule, however, where there is a fiduciary or other special relationship between the plaintiff and the

defendant. Id. “[W]hen such a relationship exists, the person occupying the position of fiduciary

or of confidence is under a duty to reveal the facts to the plaintiff, and his silence is as fraudulent

as an actual affirmative false representation or act.” Id. Stated another way, “[s]ilence by a person

in a position of trust concerning the facts giving rise to a cause of action amounts to fraudulent

concealment.” Id. at 1155.

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No. 1-21-1352

¶ 71   Courts will not apply fraudulent concealment to toll the statute of repose, however, where

“ ‘the claimant discovers the fraudulent concealment, or should have discovered it through

ordinary diligence, and a reasonable time remains within the remaining limitations period.’ ”

Mauer v. Rubin, 401 Ill. App. 3d 630, 649 (2010) (quoting Smith v. Cook County Hospital, 164 Ill.

App. 3d 857, 862 (1987)). Accordingly, where the plaintiff has been put on “inquiry” as to a

defendant’s fraudulent concealment before the expiration of the limitations period, he cannot later

use fraudulent concealment “as a shield in the event that he does not file suit within the statutory

period.” Id.

¶ 72   Accordingly, there are several operative dates for this court to consider in addressing this

claim. Plaintiffs allege that BDO retained defendant in 2000, and had some interaction with BDO

in 2002. Thus, the two-year statute of limitations would expire in 2004 at the latest, and the six-

year statute of repose would expire in 2008. Thus, if plaintiffs knew or should have known of their

cause of action or defendant’s fraudulent concealment before 2008, fraudulent concealment would

not serve to toll the limitations period because plaintiffs would have been put on inquiry about

their claim and defendant’s fraudulent concealment before the expiration of the limitations period.

¶ 73   In addition, we must also keep in mind the five-year limitations period of section 13-215.

Plaintiffs alleged that they first learned of defendant’s role in BDO’s fraud and breach of fiduciary

duty on December 30, 2009, and filed their complaint in this case exactly five years later. Thus, if

plaintiffs knew or reasonably should have known before December 30, 2009, that BDO provided

them with fraudulent tax advice and solutions despite BDO’s affirmative misrepresentations or

silence, but failed to inquire further in order to discover if they had a cause of action against BDO

and defendant, who plaintiffs allege had been working with BDO on the conspiracy, then the five-

year limitations period would begin to run on that date. Plaintiffs’ claims would therefore be time-

                                               - 23 -
No. 1-21-1352

barred despite the existence of any fraudulent concealment. Here, the record clearly shows that

plaintiffs knew or should have known of BDO’s fraud and alleged fraudulent concealment for

years before BDO filed its suit against defendant on December 30, 2009.

¶ 74    A brief chronology of the events demonstrates that plaintiffs’ claims cannot be salvaged

simply by their allegations of fraudulent concealment. Plaintiffs entered into the Sentinel

Transaction with BDO in 1999. In 2000, BDO executives contacted defendant to determine

whether the use of the Sentinel Transaction exposed BDO to civil or criminal liability. Later that

year, the IRS issued a notice concerning the use of illegal tax shelters, like the Sentinel Transaction.

BDO executives assured plaintiffs that the notice had no legal impact and that the notice would

not affect them. Plaintiffs then filed their tax returns through BDO claiming illegitimate losses

through the use of the Sentinel Transaction. In 2002, the IRS began investigating BDO, and the

plaintiffs were notified that their 1999 and 2000 tax returns were under audit by the IRS. During

the next two years, multiple suits were filed against BDO for their tax practices, including a

national class action. In October 2002, BDO sent letters to plaintiffs regarding the IRS’s

investigation of tax shelters, including the ones plaintiffs entered into, and the summons

enforcement action the IRS had instigated against BDO in federal court. All plaintiffs hired or

contacted independent legal counsel by 2003.

¶ 75    In December 2004, plaintiffs Tatro, Humenansky, and Cullinane settled with the IRS

acknowledging that their 1999 tax shelters were illegitimate. Plaintiff Tatro testified at his

deposition that he knew in December 2004 that he had gotten a “raw deal” and that BDO had

wronged him. Plaintiff Cullinane testified that by December 2004, he knew the tax information

BDO had provided to him was “not accurate,” and at that time he wanted to investigate whether

he had any reason to file suit. Plaintiff Filipowski testified that in 2003 he had “some suspicions,”

                                                 - 24 -
No. 1-21-1352

but he did not recall precisely when his “concerns grew exponentially,” which may have happened

in 2004, 2005, or 2006. Each plaintiff testified that they ceased to rely on BDO’s advice by 2004

at the latest.

¶ 76    In 2004, plaintiffs entered into tolling agreements with BDO relating claims they may have

had against BDO related to the tax shelter transactions plaintiffs had entered into in 1999. In 2005,

plaintiffs Tatro, Humenansky, and Cullinane settled their claims against BDO as part of a nation-

wide class action. In September 2005, the IRS issued notices of Final Partnership Administrative

Adjustment (FPAA) to the plaintiffs. In the FPAAs, the IRS informed plaintiffs that it had

determined that their partnerships created in association with their use of the Sentinel Transactions

were “sham[s],” and were formed solely for the purpose of tax avoidance. Three plaintiffs filed

petitions in tax court challenging the IRS’s determination. Plaintiff Humenansky testified at his

deposition that he was considering legal action against BDO in 2005, after settling with the IRS.

Plaintiff Freedman testified that in May 2005 he discussed with plaintiffs Cullinane and Tatro their

potential recourse against BDO. Plaintiff Wright, who settled with the IRS in July 2007, testified

at his deposition that it was his belief in May 2008 that BDO had marketed illegal tax shelters to

him in 1999 and 2000. From 2005 through 2009, the plaintiffs discussed among themselves

whether to file suit against BDO. In June 2009, multiple BDO executives were indicted for their

role in a fraudulent tax scheme. On December 30, 2009, BDO filed suit against defendant.

¶ 77    Although there is some variation among the plaintiffs regarding when and whether they

settled their claims with BDO and the IRS, one thing is true of all plaintiffs, and that is that they

knew or should have known of any alleged fraudulent concealment and their cause of action well

before December 30, 2009. Plaintiffs knew that BDO had provided them with fraudulent tax advice

in 2004, and were aware by 2005 that the IRS considered their tax transactions shams. Plaintiffs

                                               - 25 -
No. 1-21-1352

were considering filing suit against BDO in 2004 and 2005. Multiple BDO executives were

indicted in June 2009, six months before BDO filed suit against defendant. Although plaintiffs

may not have known all of the facts giving rise to their cause of action against defendant in 2004

or 2005, the record shows that at this point plaintiffs had sufficient information such that they

reasonably should have discovered the alleged concealment through the exercise of ordinary

diligence. See Turner v. Nama, 294 Ill. App. 3d 19, 28 (1997) (holding that if the plaintiff should

have discovered the fraudulent concealment through due diligence and a reasonable time remains

within the limitations period, the fraudulent concealment exception cannot be invoked). At a

minimum, plaintiffs knew or should have known at this point that the assurances BDO had made

to them in the early 2000s that their tax shelter transactions were legitimate were false. Thus, even

assuming the fraudulent concealment statute applies here, plaintiffs knew or should have known

of their claims at the latest in 2005 or 2006. The five-year statute of repose would therefore have

expired in 2011, three years before plaintiffs filed suit. Even giving plaintiffs the extreme benefit

of the doubt that they could not have known of BDO’s fraudulent conduct until BDO executives

were indicted in June 2009, their complaint, filed in December 2014, was still filed outside of the

five-year limitations period of section 13-215.

¶ 78    We find plaintiffs’ reliance on DeLuna, 223 Ill. 2d 49 unpersuasive. In DeLuna, the

plaintiffs retained an attorney to pursue medical malpractice claims. Id. at 54. The plaintiffs did

not speak English and relied on their Spanish-speaking attorney for updates about their lawsuit.

Id. at 54-55. Without informing the plaintiffs, the attorney deliberately did not attach a necessary

affidavit to the complaint because he wanted to challenge the constitutionality of the affidavit

requirement. Id. at 54. The suit was eventually dismissed with prejudice based on the attorney’s

failure to attach the affidavit. Id.

                                               - 26 -
No. 1-21-1352

¶ 79    The dismissal was reversed on appeal, but upheld by the supreme court who affirmed the

constitutionality of the affidavit requirement and the dismissal of the plaintiffs’ action. Id. at 55.

After the supreme court’s ruling, and as the deadline for the statute of repose for medical

malpractice actions approached, the attorney met with the plaintiffs and assured them that the

medical malpractice case was going well. Id. The attorney then re-filed the case, this time attaching

the necessary affidavit, the action against the doctor was dismissed on the basis of res judicata,

and the supreme court affirmed that judgment on appeal. Id. The plaintiffs later settled with the

hospital. Id. The plaintiffs then filed a legal malpractice action against the attorney, but the attorney

moved to dismiss on the basis that the statute of limitations for filing the legal malpractice suit

based on his conduct nearly 10 years prior had expired. Id. at 55-56.

¶ 80    On appeal to the supreme court, the court found that the plaintiffs’ allegations were

sufficient to establish the attorney’s fraudulent concealment of facts supporting their legal

malpractice cause of action. Id. at 81. The court found that the attorney made continued

reassurances to the plaintiffs that there was no need for them to inquire further about their case,

and plaintiffs alleged that they relied on that representation. Id. The court also found that because

the plaintiffs could not speak English, they were not “required to conduct their own courthouse

investigation” and were “even less qualified than ‘most clients *** to undertake that type of

monitoring.’ ” Id. at 81-82 (quoting Horwitz v. Holabird & Root, 212 Ill. 2d 1, 17 (2004)). The

court further determined that based on the attorney’s assurances, the plaintiffs had no reason to

think that such investigation was necessary. Id. at 82. The court therefore found that the plaintiffs

had adequately pled fraudulent concealment to extend the limitations period for their legal

malpractice claim. Id.

                                                 - 27 -
No. 1-21-1352

¶ 81   Here, in contrast to DeLuna, plaintiffs cannot claim that they relied on BDO or defendant’s

representations in delaying in filing their suit until well after the statute of limitations and statute

of repose expired. By plaintiffs’ own admissions, they ceased relying on BDO’s advice in 2004 or

2005, and knew, at that time, that BDO had wronged them in some manner. BDO even entered in

settlement agreements with some of the plaintiffs. It was at that point that plaintiffs’ duty to

conduct ordinary diligence and investigate further began. This was not a situation, like DeLuna,

where plaintiffs were incapable of conducting further investigation because of a language barrier

or similar limitation. Indeed, each plaintiff acknowledged that they were represented by or

consulted with various attorneys in the early 2000s with regard to possible claims they could have

against BDO and in relation to the ongoing IRS investigation. Thus, as discussed, to the extent that

any fraudulent concealment occurred, the fraudulent concealment ceased in 2005 or 2006 when

defendants stopped relying on BDO’s representations and were on inquiry notice that BDO had

fraudulent concealed their cause of action and that they had a cause of action against BDO.

¶ 82                                   1. Defendant’s Identity

¶ 83   Plaintiffs nonetheless contend that section 13-215 should serve to toll their claims against

defendant because they were not aware of defendant’s identity until BDO filed suit against

defendant in December 2009. This argument, however, misunderstands the standard for fraudulent

concealment. For one, plaintiffs do not allege that either BDO or defendant took any action to

affirmatively prevent plaintiffs from discovering defendant’s identity. Nor do they assert that BDO

breached its fiduciary duty by failing to inform plaintiffs of defendant’s identity. Secondly, the

concern with fraudulent concealment is not plaintiffs’ knowledge of a particular defendant, but

plaintiffs’ knowledge of a cause of action.

                                                 - 28 -
No. 1-21-1352

¶ 84   As the circuit court recognized, “Illinois courts have consistently interpreted section 13-

215 to apply only to fraudulent concealment of causes of action,” and not the identity of the

defendant. Levine v. EBI, LLC, 2013 IL App (1st) 121049, ¶ 21 (citing Pratt, 71 Ill. App. 3d at

830); Guebard v. Jabaay, 65 Ill. App. 3d 255, 260 (1978) (“ ‘[u]nder the Limitations Act, the only

concealment which postpones the running of the statute of limitations is fraudulent concealment

by the defendant of the cause of action[;] *** [c]oncealment of the identity of a party liable is not

deemed the same’ ”). Therefore, where the plaintiff’s cause of action is not concealed, but the

identity of the tortfeasor is concealed, section 13-215 does not apply to allow the plaintiff an

extension of the limitations period for filling his claim. Id. Plaintiffs maintain that they did not

know of their cause of action in 2005 or 2006 due to defendant’s fraudulent concealment, but only

knew that they had received incorrect tax advice from BDO, and that the IRS was challenging their

transactions. As noted, however, even though plaintiffs may not have known of their cause of

action that this time—although plaintiffs’ deposition testimony and other contemporaneous actions

suggest that they may have—all that is necessary to defeat a claim of fraudulent concealment is to

show that plaintiffs were on inquiry such that they reasonably should have discovered their cause

of action or the fraudulent concealment through the exercise of ordinary diligence. Mauer, 401 Ill.

App. 3d at 649. In this case, the record shows that plaintiffs were on inquiry notice in 2004 or 2005

and therefore had the responsibility to investigate further. They cannot now use fraudulent

concealment as a “shield” where they failed to file suit within the statutory period. Id.

¶ 85   Plaintiffs finally contend that we should apply fraudulent concealment to toll the

limitations period where defendant’s identity was “unknowable” before December 30, 2009, when

BDO filed suit against defendant. Relatedly, plaintiffs assert that although they may have been

aware of their cause of action against BDO, they could not have known about their cause of action

                                               - 29 -
No. 1-21-1352

against defendant, who was unknown to them at the time. In support of these contentions, plaintiffs

rely on Doe v. Boy Scouts of America, 2016 IL App (1st) 152406 and Mitsias v. I-Flow Corp.,

2011 IL App (1st) 101126, ¶ 31. We find both cases distinguishable from the case at bar.

¶ 86   In Doe, a former Boy Scout joined an existing lawsuit against his former scoutmaster and

the Boy Scouts of America (“BSA”) alleging that he had been sexually abused by his scoutmaster. 2

Doe, 2016 IL App (1st) 152406, ¶ 1. The plaintiff alleged that the BSA knew that the scoutmaster

had sexually abused Boy Scouts before his abuse of the plaintiff, but they nevertheless allowed the

scoutmaster to continue to serve as the scoutmaster for the plaintiff’s troop. Id. ¶ 2. The BSA

moved for summary judgment on the basis that the plaintiff’s claim was time barred by the

applicable statute of limitations. Id. ¶ 3. In response, the plaintiff argued that his claim was timely

filed under the fraudulent concealment statute (735 ILCS 13-215 (West 2012)), where the BSA

had concealed their knowledge of the scoutmaster’s conduct, thereby concealing their liability for

the scoutmaster’s actions. Id. The trial court denied the defendants’ motion for summary judgment,

but certified a question for interlocutory review to the appellate court. Id. The question was:

                “Does the fraudulent-concealment statute of limitations permit a plaintiff to

       maintain an otherwise time-barred action for child sexual abuse when he testifies that he

       knew, before the action was time-barred, that he had sustained a physical injury from the

       abuser’s conduct and that the abuser had been arrested and tried for similar crimes?”

       (Internal quotation marks omitted) Id. ¶ 4.

¶ 87   This court answered the question in the affirmative finding if the defendants were in a

special relationship with the plaintiff, a jury could find that their silence amounted to fraudulent

       2
        The scoutmaster was eventually voluntarily dismissed from the lawsuit. Doe, 2016 IL App (1st)
152406, ¶ 1.

                                                - 30 -
No. 1-21-1352

concealment. Id. ¶¶ 7, 96. The court held that there was therefore a question of fact regarding

whether or not the defendants fraudulently concealed the plaintiff’s cause of action. Id. ¶ 97. As in

the case at bar, the defendants in Doe argued that the plaintiff could not invoke fraudulent

concealment because he knew or should have known of his cause of action when the abuse began,

and before the limitations period expired. Id. ¶ 104. The court rejected defendant’s argument

finding that merely because the plaintiff was aware of the scoutmaster’s wrongful conduct, that

did not mean that he was also on notice of the BSA’s negligence, especially where the plaintiff

alleged that he did not discover this cause of action because the BSA was fraudulently concealing

the facts giving rise to it. Id. ¶ 109. The court observed that the BSA fraudulently concealed the

cause of action going so far as to publicly disclaim knowledge of the scoutmaster’s conduct,

despite the fact that it had knowledge of the scoutmaster’s abuse for years. Id. ¶ 102. The court

found that the plaintiff had a “legitimate basis” for believing that the BSA did not know about the

scoutmaster’s history of abuse. Id. The court therefore held that the plaintiff was thus not on notice

of all facts relevant to his cause of action within the limitations period. Id. ¶ 111.

¶ 88   Plaintiffs contend that like the plaintiff in Doe, although they may have been aware of their

injury, and one party who was liable for their injury, BDO, they were not aware of another

potentially liable party, defendant, until after the limitations period expired. Here, however, unlike

in Doe, defendant did not make any affirmative representations to plaintiff in an effort to conceal

its knowledge of BDO’s criminal conduct from plaintiffs. To the contrary, plaintiffs acknowledged

that they had limited, if any, contact with defendant at all. Furthermore, there can be no question

here, unlike in Doe, that no special relationship existed between defendant and plaintiffs that would

require defendant to speak. Moreover, the decision in Doe was based in part on the BSA’s “unique

                                                 - 31 -
No. 1-21-1352

position of superiority and influence” over its youth members, like the plaintiff. Id. ¶ 92. Defendant

was not in a similar position with respect to plaintiffs in this case.

¶ 89    We find Mitsias, 2011 IL App (1st) 101126 distinguishable for similar reasons. In Mitsias,

the plaintiff underwent shoulder surgery in 2001, and her doctor installed a pain pump in her

shoulder. Id. ¶ 6. Following surgery, the plaintiff experienced severe pain and reduced range of

motion in her shoulder. Id. In October 2003, the plaintiff filed her initial complaint against the

doctor and the hospital alleging claims of negligence and respondeat superior. Id. ¶ 7. During

discovery, the plaintiff learned that the pain pump that had been inserted in her shoulder had been

known to cause the type of injuries the plaintiff had suffered. Id. ¶¶ 8-9. This information was not

known at the time the plaintiff’s pain pump was inserted in 2001, but was discovered years later

in 2007.

¶ 90    The plaintiff subsequently voluntarily dismissed her initial suit, and in February 2009 filed

a products liability action against the manufacturer of the pain pump, as well as re-alleging her

medical malpractice claims against her doctor. Id. ¶ 10. The products liability defendants moved

to dismiss the plaintiff’s claims against them as time barred by the two-year limitations period of

section 13-213(d) of the Code (735 ILCS 5/13-213(d) (West 2008)). The trial court granted the

products liability defendants’ motion to dismiss. Id. ¶ 15.

¶ 91    On appeal, this court framed the central issue as “how the discovery rule is applied when a

plaintiff is aware that her injury might have been wrongfully caused by one source but is unaware

that her injury might have been caused by another source and, in fact, could not be aware of that

source because the causal link was as yet unknown to science.” Id. ¶ 19. The court found that the

discovery rule should serve to toll the plaintiff’s claims because the plaintiff filed a timely medical

malpractice action, and the only reason she delayed in filing the products liability suit was not “due

                                                 - 32 -
No. 1-21-1352

to any lack of diligence on her part but, rather, to the fact that the scientific community was not

aware of the dangers associated with pain pumps until the summer of 2007.” Id. ¶ 29. The court

concluded that “where a plaintiff knows or should reasonably know that her injury was caused by

one source, but remains unaware of another source that could not be discovered through the

exercise of diligent inquiry, the statute of limitations does not begin to run with regard to that

second source until such time as that second source would become discoverable through diligent

inquiry.” Id. ¶ 31.

¶ 92   Plaintiffs maintain that like the plaintiff in Mitsias, one source of their injury may have

been discoverable within the limitations period, but defendant’s identity and role in causing their

injury was not knowable. We first observe that Mitsias is a discovery rule case, rather than a

fraudulent concealment case, so its applicability in this case is questionable. Nonetheless, Mitsias

represents a unique set of circumstances where the plaintiff was unable to discover the second

source of her injury within the limitations period because the cause was “unknown to science.” Id.

¶¶ 19, 43. Therefore the plaintiff could not have discovered the second source of her injuries

regardless of the amount of diligence she employed; it was simply unknowable. Mitsias thus goes

beyond cases where the defendant’s identity was simply unknown to the plaintiff, but was for all

practical purposes, unknowable.

¶ 93   Defendant’s identity in this case was not similarly unknowable before the limitations

period expired. Rather, we find the circumstances in this case more akin to those present in Wells

v. Travis, 284 Ill. App. 3d 282 (1996). In that case, the plaintiff sued the defendant doctor for

medical malpractice. Id. at 284. The plaintiff subsequently filed an amended complaint adding a

second doctor to the lawsuit. Id. The second doctor filed a motion to dismiss the claims against her

in the complaint contending that the plaintiff’s claims were barred by the statute of limitations. Id.

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No. 1-21-1352

¶ 94    On appeal to the supreme court, the plaintiff argued that she had no knowledge of the

second doctor’s alleged malpractice until she began discovery on her initial malpractice suit. Id. at

286. The court distilled plaintiff’s argument as “a person is not charged with knowledge sufficient

to trigger the running of the limitations period as to any particular defendant until the person knows

or reasonably should know that the injury was wrongfully caused by the negligence of that

defendant.” (Emphasis in original.) Id. at 287. The court stated that it “expressly disavowed” that

interpretation of the discovery rule, holding instead that the statute of limitations begins to run

when “ ‘the injured person becomes possessed of sufficient information concerning his injury and

its cause to put a reasonable person on inquiry to determine whether actionable conduct is

involved.’ ” Id. (quoting Knox College v. Celotax Corp., 88 Ill. 2d 407, 416 (1981)). The court

continued that at that point the burden is on the injured party to inquire further as to the existence

of a cause. Id. Following Wells, this court has routinely held that where a plaintiff is aware that

their injury may be wrongfully caused, the limitations period begins to run and the plaintiff’s

responsibility to conduct a reasonable inquiry into the cause of the injury begins, even if the

plaintiff is not aware of a specific defendant’s tortious act. See, e.g., Castello v. Kalis, 352 Ill. App.

3d 736, 749 (2004) (“Like the plaintiff in Wells, the essence of plaintiff’s position here is that [the

plaintiff] should not have been charged with knowledge sufficient to trigger the running of the

limitations period as to any particular defendant until she knew or reasonably should have known

that her injury was caused by that defendant. As stated in Wells, our supreme court has expressly

disavowed any such interpretation of the discovery rule.” (Emphasis in original.)); Hoffman v.

Orthopedic Systems, Inc., 327 Ill. App. 3d 1004, 1011 (2002) (“Although [the plaintiff’s] suspicion

of wrongful causation was limited to an investigation as to whether medical malpractice was

committed, rather than whether a product liability action existed, *** the term ‘wrongfully

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No. 1-21-1352

caused,’ does not mean knowledge by a plaintiff of a specific defendant's negligent act. ****

Plaintiff’s failure to pursue a more thorough inquiry to find the cause of her injuries does not

excuse her from failing to comply with the statute of limitations.”).

¶ 95    In sum, plaintiffs here had ample notice of their injury in 2004 or 2005. At the very least,

they had sufficient information at that time to exercise ordinary diligence such that they reasonably

should have discovered the alleged fraudulent concealment. Accordingly, the limitations period

began to run at that point. This case does not present the same unique circumstances that were

present in Mitsias, but rather follows the traditional rule that the limitations period is not tolled

simply because plaintiffs were not aware of a specific defendant’s alleged tortious conduct. Simply

because defendant’s identity was unknown to plaintiffs at the time does not mean that defendant’s

identity was “unknowable” or that plaintiffs were somehow excused from their responsibility to

exercise ordinary diligence. Therefore, the fact that defendant’s identity was unknown to plaintiffs

within the limitations period is irrelevant under section 13-215. Accordingly, section 13-215

cannot serve to extend the time for plaintiffs to file this cause of action until December 2014. We

therefore affirm the circuit court’s entry of summary judgment in favor of defendant.3

        3
          We observe that plaintiffs attached to their reply brief a decision from the Florida District Court
of Appeal in a case involving allegations against defendant that are similar to the allegations plaintiffs
raise in this case. See Kent Logan & Lance Logan v. Morgan, Lewis & Bockius LLP, BDO Seidman, LLP,
and AIG International, Inc., No. 2D21-337, 2022 WL 12100591 (Fla. 2d DCA 2022). However, that
appeal arose from the trial court’s grant of defendant’s motion to dismiss the plaintiffs’ complaint. On
appeal, therefore, the court solely considered whether the allegations in the complaint were sufficient to
survive the motion to dismiss. The court’s review was therefore limited to the “four corners” of the
plaintiffs’ complaint. Id. at 3. Here, in contrast, this appeal concerns the circuit court’s grant of summary
judgment. We therefore have the benefit of affidavits, depositions, and hundreds of exhibits in
determining whether defendant is entitled to judgment as a matter of law, not whether plaintiffs’
complaint adequately stated a cause of action. The Florida District Court of Appeals also expressly did
not address the statute of limitations or statute of repose noting that those were affirmative defenses. Id. at
7. Notably, the circuit court in the case at bar denied defendant’s motion to dismiss the complaint,
rejecting many of the same arguments addressed by the Florida District Court of Appeal. We therefore

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¶ 96    Because we affirm the circuit court’s ruling on the basis that plaintiffs’ claims are time-

barred, we need not address defendant’s alternate theories of affirmance, including that plaintiffs’

claims are barred by their settlement agreements with BDO and that plaintiffs’ claims are barred

by the doctrine of in pari delicto.

¶ 97                                      III. CONCLUSION

¶ 98    For the reasons stated, we affirm the judgment of the circuit court of Cook County.

¶ 99    Affirmed.

find no discrepancies between the decision in this case and the judgment of the Florida District Court of
Appeal in Logan.

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