Same Condition, LLC v. Codal, Inc.

2021 IL App (1st) 201187

187 N.E.3d 1147

453 Ill.Dec. 409

SAME CONDITION, LLC, an Illinois Limited Liability Company, Plaintiff and Counterdefendant-Appellant,

v.CODAL, INC., an Illinois Corporation, Defendant and Counterplaintiff-Appellee

(Munish Kumar, a/k/a Munish Kumar Raizada, Counterdefendant-Appellant).

No. 1-20-1187

Appellate Court of Illinois, First District, Third Division.

Filed June 21, 2021

Munish Kumar, of Same Condition, LLC, of Chicago, appellant pro se.

Bryan Sugar, William Mauke, and Siobhán M. Murphy, of Lewis Brisbois Bisgaard & Smith LLP, of Chicago, for appellee.

JUSTICE BURKE delivered the judgment of the court, with opinion.

¶ 1 After a business relationship between Codal, Inc. (Codal), and Same Condition, LLC (Same Condition), soured, Same Condition sued Codal for breach of contract, among other claims. Codal then countersued Same Condition and its president, Munish Kumar, raising various claims, including ones sounding in defamation based on critical comments and reviews that Same Condition and Kumar had posted online. As the litigation progressed, Same Condition and Kumar continued posting critical comments and reviews online about Codal and its chief executive officer, Keval Baxi, which resulted in Codal filing motions for a preliminary injunction and temporary restraining order to have Same Condition and Kumar cease their online campaign. Although the circuit court denied those motions, it utilized its inherent authority to manage its cases and prohibited Same Condition and Kumar from making any additional posts online about Codal.

¶ 2 Same Condition and Kumar have appealed the circuit court's order as an unconstitutional abridgment on their right to free speech under both the first amendment of the United States Constitution ( U.S. Const., amend. I ) and article I, section 4, of the Illinois Constitution ( Ill. Const. 1970, art. I, § 4 ). Because we agree that the court's order is unconstitutional, we vacate that order.

¶ 3 I. BACKGROUND

¶ 4 Codal is a corporation that provides personnel with expertise in the fields of systems integration, information technology consulting, and systems development. Same Condition is a company that intended on creating a web-based, medical patient-centered software application. In June 2017, Same Condition hired Codal to develop that software application. According to Same Condition's interpretation of their agreement, Codal was supposed to deliver the software application to it by January 2018. But, by January 2018, Codal had failed to deliver the application. And, in July 2018, when Codal had delivered the software application, Same Condition believed the application was incomplete, substandard, rife with errors and bugs, and inadequate to be released publicly. According to Same Condition, by October 2018, Codal indicated that it needed at most 100 more hours of work to complete the application to Same Condition's specifications.

¶ 5 Eventually, in May 2019, after the software application allegedly did not meet Same Condition's standards, it sued Codal for breach of contract, fraud, and unjust enrichment. Two months later, Codal answered Same Condition's complaint and denied the chief allegations therein. Codal also raised several affirmative defenses and brought counterclaims, including breach of contract for Same Condition's failure to pay an invoice of $30,750.

¶ 6 In August 2019, Codal, with leave from the circuit court, filed its first amended counterclaims. Codal added claims for defamation per se , defamation per quod , a violation of the Uniform Deceptive Trade Practices Act (Deceptive Practices Act) ( 815 ILCS 510/1 et seq. (West 2018)) and commercial disparagement against Same Condition and Kumar, Same Condition's president. All four counterclaims were based on online posts from Kumar and Same Condition about Codal's performance and business integrity. Codal attached these posts as exhibits to its first amended counterclaims.

¶ 7 One exhibit showed a comment on a post from Codal's LinkedIn page, where Kumar stated that he hired Codal to build an "ambitious" software platform and "gave them a huge sum" but the project was not completed on time and the platform that was completed was defective. Kumar added that he had to hire a third-party quality assurance tester to test Codal's platform and remarked that it was:

"more than clear that Codal lacks the technical expertise to build the software or our specifications. It was not a small platform (technically, but then we hired Codal because they assured that have the required skill sets to accomplish the kind of work it requires. And they asked is premium cost, which we kept paying as bills kept coming). But Codal has not been able to hand over the platform to us now. Harassed and frustrated by Codal's highly unethical business practices, we had to drag them to court in Chicago in 2019."

¶ 8 Another exhibit showed that, in July 2019, Same Condition's Twitter account replied to various tweets from Codal's Twitter account. In some of these replies, Same Condition remarked that Codal had "cheated" the company, delivered a "half-cooked buggy platform," provided a "nightmare experience," and overall exhibited "[v]ery unethical business practices." In addition to Codal being tagged in the replies, other companies’ Twitter accounts were as well. Additional exhibits showed that, in July 2019, Kumar left similarly negative reviews on Codal's Google page, its Better Business Bureau page, and its Clutch page.

¶ 9 Same Condition and Kumar subsequently filed their own answer and affirmative defenses to Codal's counterclaims. In that filing, Same Condition and Kumar admitted that the referenced social media posts had been posted by them, but they denied that any of the posts contained false statements. As the litigation proceeded from 2019 to 2020, the parties conducted discovery.

¶ 10 In February 2020, Same Condition and Kumar filed a motion for an extension of time to answer Codal's requests to admit. The next month, Codal filed a response opposing their motion for an extension of time and to expedite the circuit court's ruling on the motion. In Codal's response, it observed that Same Condition and Kumar had "embarked on an extensive campaign of posting new defamatory content on social media." Codal highlighted that Same Condition changed its Twitter biography to state that it was "[a] Global Health Community that failed to start because @GoCodal messed up our software product. Seeking justice from Chicago-based #Codal and its CEO @kevalbaxi." Additionally, Codal asserted that Same Condition and Kumar had contacted Codal's former clients, potential clients, past employees, and current employees in order to defame Codal and Baxi, its chief executive officer. Codal attached to its response a declaration from Baxi, who averred to the various actions allegedly taken by Same Condition and Kumar. Baxi pointed out that Same Condition and Kumar's social media campaign included them "making negative and disparaging comments on all of Codal's online postings." Baxi noted that Codal's "online presence [was] critical" to its business and asserted that Same Condition and Kumar's "actions have prevented Codal and [him]self from maintaining said online presence as we are unable to issue necessary press release, important marketing materials, or post even unrelated social media content as [Same Condition and Kumar] respond to any online post with negative and defaming comments." Baxi further highlighted a chronological list of the social media posts and comments from Same Condition and Kumar directed at Codal and Baxi that he and his company had created. According to that list, Same Condition and Kumar had commented about Codal and Baxi 69 times from February 17, 2020, to March 2, 2020, on Twitter, LinkedIn, and Google.

¶ 11 For example, in a two-day stretch from February 17 to February 18, 2020, Same Condition tweeted the following from its account:

"@gocodal @mobileappdaily We had a very bad experience with @Gocodal. They charged us hefty amounts and 3 years have passed, wanted to dump a buggy half cooked website on us. We refused and dragged them to court. #Codal"

"@gocodal @AppDevFirms Codal did not complete our project, whatever the software they built for us, was half cooked and full of problems. We had a horrible experience with them. #Codal"

"@AppDevFirms @gocodal @hyperlinkinfo @hashrocket @palantir @orbiteers @myplanet @prometsource @Realnets @educoweb @cre8inc Codal NOT only failed to develop our software platform properly, they usurped our money and refused to listen to our concerns. Left with no option, we had to drag #Codal to a Chicago court. Now Codal playing legal games rather than addressing the issues."

"@AppDevFirms @gocodal @hyperlinkinfo @hashrocket @palantir @orbiteers @myplanet @prometsource @Realnets @educoweb @cre8inc See how #Codal is playing out now! They Blocked us on Twitter. Sir @gocodal, you need to listen to the grievances of your customer rather than blocking. Bad business ethics!"

"My struggle with @goCodal company. They have failed to deliver my product. Codal is technically incompetent. @BuiltinChicago @CrainsChicago @Midwest_loT @1871Chicago @BigTimeSoftware Note: #Codal has blocked our twitter handle."¹

"@gocodal @Ontraport @buffer @SproutSocial @ahrefs @convertflow @GMktgPlatform @semrush @hotjar @ActiveCampaign Months have passed since we wrote this, but #Codal company of Chicago (@gocodal) refuses to accept that they were not able to provide IT solutions that agreed scope of work required. Surprised that unfair business practices continue. @ExecClubChicago @AnnCDwyer @ChiTribBiz"

Also on February 18, 2020, Kumar posted a Google Review about Codal stating the following:

"We are having a very bad experience with Codal company. We hired Codal about 3 years back to develop a healthcare platform. Time has passed, but Codal has not been able to develop our product so far in a satisfying manner. They

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