Scarinci Hollenbeck, LLC, LLCScarinci Hollenbeck, LLC, LLC

Firm Insights

Yellow Cab Owner Files For bankruptcy Following $26 Million Verdict

Author: Joel R. Glucksman

Date: April 2, 2015

Key Contacts

Back

The company that owns and operates Yellow Cab filed for bankruptcy March 18, after a jury in Cook County, Illinois, awarded a nearly $26 million verdict to a plaintiff who pursued legal action following a car accident in 2005.

Yellow Cab presents itself as the oldest and largest taxi cab company in North America, according to WLS. While its drivers are all independent contractors, the court system found the company liable for a tollway accident that took place a decade ago.

The day after the Cook County jury verdict, which totaled $25.9 million and was handed down on the evening of March 17, The Yellow Cab Company filed for Chapter 11 bankruptcy. The cab operator’s president has stated his company’s liabilities surpass its assets following the verdict.

Auto accident

The jury made this decision after finding the driver at fault in the high-speed crash, in which the taxi cab entered a drainage area after careening out of control when exiting southbound I-294 at Ogden Avenue, according to Chicago Tribune. The vehicle next flew through the air, before colliding with a concrete barrier.

Before the incident, Marc Jacobs worked as a real estate partner at Barack Ferrazzano Kirschbaum & Nagelberg, the media outlet reported. However, his lawyers have claimed that because of the accident, the plaintiff has suffered permanent brain damage and memory loss after a car accident that has left him incapable of working at the same level as before, even after undergoing surgeries and rehabilitation.

Lawsuit filing

In the aftermath of this event, Jacobs filed a lawsuit naming cab driver Cornelus Ezeagu as a defendant, claiming negligence, according to the news source. In addition, the legal action named Yellow Cab Affiliation Inc. and Matthew Ezeagu, who owned the vehicle, as defendants.

The plaintiff hired Robert Clifford, founder and senior partner at Clifford Law Offices, as well as Timothy Tomasik, who founded Tomasik Kotin & Kasserman and now serves as a partner at the firm.

After a two-week trial, the jury, which deliberated before Cook County Circuit Court Judge Daniel Lynch at the Daley Center, decided in favor of awarding almost $25 million in damages to Jacobs and another $4.5 million to his wife, Deborah Jacobs, for loss of consortium. Over the last decade, she has been his primary caretaker.

Fate of verdict

Because of the plaintiff’s negligence, these amounts were lowered by 12 percent to $22 million and $4 million. However, because The Yellow Cab company filed for Chapter 11 bankruptcy, how much of the verdict Marc and Deborah Jacobs will receive is uncertain, Clifford told the Chicago Tribune.

Companies frequently seek this protection from creditors if they are granted a large judgment by the court system, because taking this legal action protects their assets from seizure by the plaintiff while an appeal is pending, Robert Fishman, founder of Chicago bankruptcy law firm Shaw Fishman, told Crain’s Chicago Business.

The Yellow Cab stated in bankruptcy documents that it has assets worth between $1 million and $10 million, the media outlet reported. In addition, these papers failed to state whether any secured creditors have claims against the cab operator’s assets, according to Chicago Tribune.

At least for now, the married couple is unable to collect on the award until the court system resolves the bankruptcy situation, Douglas Baird, a bankruptcy expert at the University of Chicago Law School, told the news source.

Appeal planned

Following the legal decision, Yellow Cab has indicated it plans to appeal the verdict and continue to operate its taxis during its Chapter 11 bankruptcy proceedings, according to WLS.

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Scarinci Hollenbeck, LLC, LLC

Related Posts

See all
Why Secured Transactions Are Important post image

Why Secured Transactions Are Important

Secured transactions form the backbone of a wide range of business dealings, including business loans, mortgages, and inventory financing. Because the stakes are often high and relatively minor oversights can have drastic consequences, lenders and borrowers should thoroughly understand how to form an enforceable security agreement that protects their legal rights. What Is a Secured […]

Author: Dan Brecher

Link to post with title - "Why Secured Transactions Are Important"
Don’t Cash a “Paid in Full” Check Without Understanding the Legal Implications post image

Don’t Cash a “Paid in Full” Check Without Understanding the Legal Implications

Cashing a check marked “paid in full” can be a risky endeavor, particularly if you don’t fully understanding the legal implications. If you are owed more than the amount of the check you accept and deposit, you may waive your right to collect the full disputed amount. That is why you should consider either rejecting […]

Author: Dan Brecher

Link to post with title - "Don’t Cash a “Paid in Full” Check Without Understanding the Legal Implications"
Changes to Qualified Small Business Stock Will Benefit Startup Founders and Investors post image

Changes to Qualified Small Business Stock Will Benefit Startup Founders and Investors

The One Big Beautiful Bill Act of 2025 (OBBBA) significantly impacts federal taxes, credits, and deductions. A key change relating to Qualified Small Business Stock (QSBS) allows greater tax-free gains for investments in startups and other qualifying small businesses. Company founders and other investors should understand how the enhanced tax strategy works or risk missing […]

Author: Dan Brecher

Link to post with title - "Changes to Qualified Small Business Stock Will Benefit Startup Founders and Investors"
Corporate Consolidation and Antitrust Issues in Mergers post image

Corporate Consolidation and Antitrust Issues in Mergers

Corporate consolidation involves two or more businesses merging to become a single larger entity. The result is often a stronger and more competitive company that can better navigate today’s competitive marketplace. What Is Corporate Consolidation? Corporate consolidation closely resembles a basic merger transaction. The primary difference is that a consolidation creates an entirely new business […]

Author: Dan Brecher

Link to post with title - "Corporate Consolidation and Antitrust Issues in Mergers"
What is Business Law and Why Is it Important? post image

What is Business Law and Why Is it Important?

Business law plays a critical role in nearly every aspect of running a successful enterprise, from negotiating a commercial lease to drafting employee policies to fulfilling corporate disclosure obligations. Understanding what is business law and your legal obligations can help your business run smoothly and build productive relationships with clients, business partners, regulators, and others. […]

Author: Dan Brecher

Link to post with title - "What is Business Law and Why Is it Important?"
Corporate Transactions: Best Practices for Successful Deals post image

Corporate Transactions: Best Practices for Successful Deals

Corporate transactions can have significant implications for a corporation and its stakeholders. For deals to be successful, companies must act strategically to maximize value and minimize risk. It is also important to fully understand the legal and financial ramifications of corporate transactions, both in the near and long term. Understanding Corporate Transactions The term “corporate […]

Author: Dan Brecher

Link to post with title - "Corporate Transactions: Best Practices for Successful Deals"

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Sign up to get the latest from our attorneys!

Explore What Matters Most to You.

Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.

Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.

Let`s get in touch!

* The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form. By providing a telephone number and submitting this form you are consenting to be contacted by SMS text message. Message & data rates may apply. Message frequency may vary. You can reply STOP to opt-out of further messaging.

Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!