ADT Security Services, Inc. et al v. Lisle-Woodridge Fire Protection District, The et al

Filing 238

MEMORANDUM Opinion Signed by the Honorable Milton I. Shadur on 12/7/2011:Mailed notice(srn, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
ADT SECURITY SERVICES, INC.,
et al.,
Plaintiffs,
v.
LISLE-WOODRIDGE FIRE
PROTECTION DISTRICT, et al.,
Defendants.

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No.

10 C 4382

MEMORANDUM OPINION
On November 22, 2011 our Court of Appeals issued an order
(“Order”) that stayed the permanent injunction that this Court
had entered on August 16, 2011 (the “Permanent Injunction”),
explaining that the Court of Appeals “intends to issue an opinion
and judgment affirming the permanent injunction in part and
vacating it in part.”

In that connection the Court of Appeals

concluded that the Illinois Fire District Act (“Act”) gives the
Lisle-Woodridge Fire Protection District (the “District”) certain
regulatory authority but also concluded “that the Act does not
authorize the District to displace the competitive market for
fire alarm monitoring services by requiring all affected property
owners to contract with only the District for providing alarm
equipment and monitoring services,” so that injunctive relief
“somewhat narrower” than the Permanent Injunction is called for.
Under the Order, various specified provisions of the
Permanent Injunction remain in effect during the stay.

Relatedly, Order ¶2 provides in part:
Pending further order of this court, however, alarm
monitoring customers in the District may voluntarily
terminate their contracts with the District and/or its
exclusive provider and may transfer their business to
another alarm company. Alarm monitoring customers may
be notified of this option by plaintiffs or other
competing alarm companies.
This action has previously been set by this Court for a
status hearing on December 7 to address another phase of this
litigation.

But shortly before that hearing, counsel for the

plaintiff Alarm Companies have delivered to this Court an
informational copy of their December 5 motion directed to the
Court of Appeals, in which they request clarification of certain
aspects of the Order and have attached a number of exhibits.
That motion reflects in part some troubling conduct on the part
of the District and its counsel, including a communication sent
by the District to all the alarm system customers that appears
misleading because it communicates only one component of the
Court of Appeals’ Order and thus does not inform the customers of
the options available to them.
For that reason it seems appropriate to reiterate one aspect
of this Court’s July 20, 2011 memorandum opinion and order (the
“Opinion”) that granted partial summary judgment against the
District--an aspect that is relevant to the subject referred to
in the language quoted above from Order ¶2.

It will be recalled

that a major part of the dispute between the litigants stemmed

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from the District’s notices to customers of the plaintiff Alarm
Companies having contracts for alarm services in the area,
stating that those contracts were “null and void.”

Thereafter

this Court held that those notices were illegal--that it was the
notices themselves and not the previously-existing contracts that
were “null and void.”
This Court’s understanding is that most of those preexisting
contracts for security alarm systems contained a provision under
which each customer had the right to give a timely notice of
termination by a specified termination date, with the contract
being automatically renewed if no such notice were given.
Because of the District’s “null and void” notice and other
communications from the District, the customers were effectively
deprived of the opportunity to make such a free choice.
Under those circumstances and under the terms of the Court
of Appeals’ Order confirming the need for a “competitive market,”
it should remain a matter of free choice on the customers’ part
to determine whether in the absence of the District’s notice and
other actions, and given the option that had been available to
the customers before the District interfered with such free
choice, the customers would have elected to allow their
preexisting contracts to renew themselves or would instead have
voluntarily terminated those preexisting contracts.

In that

respect it is this Court’s view that the customers’ exercise of

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their free choice should not be influenced by the fact that they
have since entered into contracts for such services with another
company by reason of the District’s unauthorized decision “to
displace the competitive market for fire alarm monitoring
services by requiring all affected property owners to contract
with only the District for providing alarm equipment and
monitoring services.”
In that respect the customers should be made aware that
portions of the Permanent Injunction that remain in effect during
the current stay of other portions would permit any customer that
wishes to terminate the contract with the District or its
exclusive provider and to transfer its business to another alarm
company (whether its original provider or any other company) will
be assured that the protection it receives from its security and
alarm system will be uninterrupted.

It is hoped that the present

dispute between the litigants can give way to the transmittal of
a neutral statement to the customers that includes that
assurance.

________________________________________
Milton I. Shadur
Senior United States District Judge
Date:

December 7, 2011

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