Chicago City Wire

The City of Chicago has engaged Edelson PC as Special Assistant Corporation Counsel on a contingency basis to represent the city in lawsuits against Marriott over a data breach and Hyundai/Kia for vehicle security failures, according to records obtained through the Freedom of Information Act (FOIA).

Edelson PC, a plaintiffs’ law firm based in Chicago, Illinois, specializes in consumer class actions, data privacy, and technology litigation. The firm has experience representing government entities and individuals in high-profile data breach and privacy cases. The City of Chicago has retained Edelson PC for litigation related to both the Marriott data breach and Hyundai/Kia vehicle security issues.

According to the retention agreements acquired via FOIA, Edelson PC is representing the City on a contingency-fee basis, covering all litigation costs upfront. The fee structure for the Marriott case ranges from 12% to 25% of any recovery depending on the stage of litigation, while fees for the Hyundai/Kia case range from 15% to 25%. Both agreements stipulate that the City will only reimburse reasonable out-of-pocket costs if there is a recovery.

The agreements appoint Edelson PC as Special Assistant Corporation Counsel for Chicago. However, the City retains all significant decision-making powers, including whether to file, settle, or terminate litigation. It also maintains authority over strategic decisions. Edelson PC must adhere to Chicago’s Outside Counsel Guidelines and coordinate with city officials as outlined in their engagement letters.

A white paper by former Nebraska Attorney General Doug Peterson from the Washington Legal Foundation examines legal and policy issues concerning municipalities hiring private law firms on a contingency-fee basis for public-interest lawsuits. The paper addresses concerns about public oversight, transparency, and delegating litigation strategy to outside counsel while exploring statutory authority and constitutional questions regarding these arrangements.

The Marriott retention agreement specifies that Edelson PC will be compensated only if Chicago achieves financial recovery through settlement or judgment. It also requires advance written approval from the City for any litigation expense exceeding $5,000 and enforces strict confidentiality requirements for all city data shared with the firm. If no recovery is made, Chicago is not liable for attorneys’ fees or costs.