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Chicago Options Associates

From Alfawiki
Chicago Options Associates
Company typePrivate
IndustryFinancial services
Founded1987
FounderOliver R. W. Pergams, Michael E. Davis
Headquarters
Chicago, Illinois
,
United States
ProductsOptions and futures contracts trading

Chicago Options Associates (COA) is a financial firm headquartered in Chicago, Illinois, concentrating on the trading of options and futures contracts. Established in 1987 by Oliver R. W. Pergams and Michael E. Davis, the company appointed then-graduate student Jimmy Wales as research director in 1994 during Davis's tenure as CEO; Wales remained in this position until 1998.

Both COA and Davis were parties to notable litigation that culminated in a 2007 decision by the Illinois Supreme Court. In the case Dowling v. Chicago Options Associates, plaintiff Brian Dowling secured a judgment totaling US$817,830.45 against the defendants. To safeguard his assets, Davis transferred funds to the law firm DLA Piper, which had assisted him with a property acquisition in Florida. Among these funds was a $100,000 retainer paid to DLA Piper, which Dowling claimed was rightfully his. Although lower courts ruled in favor of Dowling, the Illinois Supreme Court overturned those rulings, siding with DLA Piper.

This precedent-setting judgment represented Illinois’ initial acknowledgment of the "advance payment retainer" concept and prompted regulatory changes in 2009 affecting legal practice statewide. The Illinois State Bar Association and Chicago Bar Association submitted amicus briefs endorsing the law firm's stance in this matter.

Trading in options and futures

Incorporated in Chicago, Illinois, Chicago Options Associates specializes in options and futures contract trading. The firm was founded in 1987 by Michael E. Davis (MBA, University of Chicago, 1983) alongside Oliver R. W. Pergams (BA, 1981), initially operating offices in both Chicago and Philadelphia. By 1994, with Davis as CEO, the company had gained a solid foothold within Chicago’s financial sector.

Davis recruited Jimmy Wales, then pursuing a Ph.D. in economics at Indiana University, to develop pricing model analyses; Wales left his doctoral studies to serve as research director from 1994 through 1998. Under Davis’s mentorship, Wales refined his skills in predicting foreign exchange and interest rate fluctuations while adopting more assertive trading strategies.

In 1996, Davis collaborated with Wales and Tim Shell to establish the Internet venture Bomis. Subsequently, when Wales founded the Wikimedia Foundation in 2003 to oversee Wikipedia operations, Davis, Shell, and Wales constituted its original three-member Board of Trustees.

As of 2013, Chicago Options Associates continued operations from its office located on LaSalle Street in Chicago.

Dowling v Chicago Options Associates, Inc

In 2007, the Illinois Supreme Court ruled favorably for law firm DLA Piper concerning a dispute over retainer fees following plaintiff Brian Dowling’s $817,830.45 judgment against Chicago Options Associates and Michael E. Davis. To protect his assets, Davis transferred funds into a trust account managed by DLA Piper that included a $100,000 advance payment retainer. While lower courts initially ordered that this retainer be returned to Dowling, the Supreme Court reversed those decisions, holding that advance payment retainers become the attorney’s property immediately upon payment.

This ruling clarified the legal distinction of advance payment retainers—fees paid upfront for anticipated services—as separate from traditional or security retainers. Traditional retainers secure an attorney-client relationship for a defined period or purpose; security retainers are deposits held in trust distinct from an attorney’s own funds. This decision was Illinois’ first formal recognition of advance payment retainers.

The Illinois State Bar Association and Chicago Bar Association filed amicus curiae briefs supporting the law firm’s position during the case. The verdict established important guidelines for defining retainer types within Illinois legal practice and influenced subsequent professional conduct regulations.

Effective January 1, 2010, these definitions were codified by the Illinois Supreme Court under Rule 1.15(c), enacted on July 1, 2009. This rule incorporated the principles outlined in Dowling and shaped ethical standards governing legal fee arrangements across business and commercial law practices within Illinois.

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External links

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