Teniket et al v. City of Benld
Filing
25
OPINION entered by Judge Sue E. Myerscough on 3/20/2019. The Report and Recommendation, d/e 19 is ACCEPTED IN PART and MODIFIED IN PART. The City's Renewed Motion to Dismiss, d/e 13 is GRANTED, and Plaintiff's Motion to Amend, d/e [17 ] is DENIED. Plaintiffs' Motion to Bifurcate, d/e 22 is DENIED AS MOOT. If Plaintiffs choose to file an amended complaint in this Court, Plaintiffs shall file said amended complaint on or before April 3, 2019. An amended complaint supersedes and replaces the original complaint. If Plaintiffs do not file an amended complaint, the Court will close the case. (SEE WRITTEN OPINION) (MAS, ilcd)
E-FILED
Thursday, 21 March, 2019 03:20:49 PM
Clerk, U.S. District Court, ILCD
IN THE UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF ILLINOIS
SPRINGFIELD DIVISION
JOHN TENIKET II, and
SHERYL TENIKET,
Plaintiffs,
v.
CITY OF BENLD,
Defendant.
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No. 18-cv-03037
OPINION
SUE E. MYERSCOUGH, U.S. District Judge:
On February 22, 2019, Magistrate Judge Tom SchanzleHaskins filed a Report and Recommendation (d/e 19)
recommending that this Court grant Defendant City of Benld’s
Renewed Motion to Dismiss and deny Plaintiffs John Tenikat II and
Sheryl Tenikat’s Motion to Amend. On March 7, 2019, Plaintiffs
filed their Objection to the Report and Recommendation and a
Motion for Bifurcation1 (d/e 22). The City has filed a response (d/e
24).
Plaintiffs filed a separate Motion to Show Cause (d/e 20) and asked this Court
to bifurcate and allow that Motion to proceed separately from Plaintiffs’
Complaint. The Court denied the Motion to Show Cause on March 20, 2019.
Therefore, this request is moot.
1
Page 1 of 9
The Report and Recommendation (d/e 19) is ACCEPTED IN
PART and MODIFIED IN PART, the Motion to Dismiss (d/e 13) is
GRANTED, and Motion to Amend (d/e 17) is DENIED. Plaintiffs’
due process, equal protection, Fourth Amendment claims are
dismissed with prejudice for failure to state a claim. Plaintiffs’
request to add a claim for a violation of the federal Fair Debt
Collection Practices Act is denied because the proposed amendment
would be futile. The civil RICO claim is dismissed without prejudice
and with leave to replead. Plaintiffs may also refile their state law
Fair Debt Collection Practices Act and Consumer Fraud and
Deceptive Business Practices Act claims should Plaintiffs state a
federal claim for relief.
I. LEGAL STANDARD
Pursuant to Federal Rule of Civil Procedure 72(b)(3), this Court
determines “de novo any part of the magistrate judge’s disposition
that has been properly objected to.” Although this Court does not
need to conduct a new hearing on the entire matter, the Court must
give “fresh consideration to those issues to which specific objections
have been made.” 12 Charles Alan Wright, Arthur R. Miller, & Mary
Kay Kane, Federal Practice and Procedure § 3070.2 (2d ed. 1997);
Wasserman v. Purdue Univ. ex rel. Jischke, 431 F. Supp. 2d 911,
914 (N.D. Ind. 2006).
If no objection is made, or if only a partial objection is made,
the Court reviews the unobjected to portions for clear error.
Johnson v. Zema Sys. Corp., 170 F.3d 734, 739 (7th Cir. 1999).
This Court may “accept, reject, or modify the recommended
disposition; receive further evidence; or return the matter to the
magistrate judge with instructions.” Fed. R. Civ. P. 72(b)(3).
II. BACKGROUND
In February 2018, Plaintiffs filed a Complaint (d/e 1) against
the City alleging the City imposed a defective lien on Plaintiffs’
property for payment of charges for cutting an excessive growth of
grass and weeds on the property. Plaintiffs alleged that the sums
sought by the City were excessive. According to Plaintiffs, the City
violated Plaintiffs’ rights to due process, equal protection, and to be
free from unreasonable searches and seizures. Plaintiffs also
alleged that, by entering the land without permission, claiming to
have performed certain acts, charging grossly excessive fees, filing
unperfected liens, and using interstate commerce, the city attorney,
the mayor, and each council member, in advisement and
consultation with each other, along with the City, engaged in an
enterprise in violation of 18 U.S.C. §1964, the Racketeer Influenced
and Corrupt Organizations Act (RICO). Finally, Plaintiffs alleged a
supplemental claim for violation of the Illinois Consumer Fraud and
Deceptive Practices Act, 815 ILCS 505/1 et seq.
The City filed a Renewed Motion to Dismiss (d/e 13). In
response, Plaintiffs objected to dismissal and sought to amend their
Complaint to add claims for violation of the federal Fair Debt
Collection Practices Act, 15 U.S.C. § 1692 et seq. and the Illinois
Fair Debt Collection Practices Act, 225 ILCS 425/1. See (d/e 17).
Plaintiffs’ response attached the state court’s order on the
City’s complaint to enforce a mowing lien. See d/e 17 at 5-13. This
Court may take judicial notice of matters of public record when
ruling on a motion to dismiss. See Olson v. Champaign Cnty., Ill.,
784 F.3d 1093, 1096 n.1 (7th Cir. 2015). The state court found
that the lien was not properly perfected and the City did not
properly serve Plaintiffs. The state court ruled in favor of Plaintiffs
and ordered the City to release the lien and pay the Plaintiffs $465
in costs and fees.
On February 22, 2019, Judge Schanzle-Haskins entered his
Report and Recommendation recommending that the Motion to
Dismiss be granted and the Motion to Amend be denied. Judge
Schanzle-Haskins found that Plaintiffs failed to state a claim that
they were deprived of property without due process because the
state court provided Plaintiffs with notice and an opportunity to be
heard. Plaintiffs failed to state a claim for a denial of equal
protection because they did not allege that the City treated them
differently than the way the City treated others similarly situated.
Plaintiffs failed to state a claim for a violation of their rights to be
free from unreasonable search and seizure because the City did not
search or seize Plaintiffs’ property.
Judge Schanzle-Haskins further found that allowing Plaintiffs
to add a claim for a violation of the federal Fair Debt Collection
Practices Act would be futile because the City was not a debt
collector under the Act. Finally, Magistrate Judge SchanzleHaskins recommended that the Court dismiss the state law claims
for lack of jurisdiction. Although Judge Schanzle-Haskins noted
that Plaintiffs and the City may be citizens of different states, the
amount in controversy--$8,350—did not exceed $75,000. Judge
Schanzle-Haskins did not address the RICO claim.
III. ANALYSIS
Plaintiffs object to the Report and Recommendation, noting
that Judge Schanzle-Haskins failed to address the RICO claim and
asserting that any dismissal should be a dismissal without
prejudice. The Court will review plaintiffs’ RICO claim de novo and
the remaining claims for clear error.
RICO provides a private cause of action for “[a]ny person
injured in his business or property by reason of a violation of
section 1962 of this chapter[.]” 18 U.S.C. § 1964(c). The provision
of §1962 that appears to be the basis of Plaintiffs’ claim makes it
“unlawful for any person employed by or associated with any
enterprise engaged in, or the activities of which affect, interstate or
foreign commerce, to conduct or participate, directly or indirectly, in
the conduct of such enterprise’s affairs through a pattern of
racketeering activity or collection of unlawful debt.” 18 U.S.C.
§ 1962(c). The RICO statute was “never intended to allow plaintiffs
to turn garden-variety state law fraud claims into federal RICO
actions.” Jennings v. Auto Meter Prod., Inc., 495 F.3d 466, 472
(7th Cir. 2007). To state a claim for civil RICO under 18 U.S.C.
§ 1964(c), Plaintiffs must allege (1) injury to their business or
property (2) by reason of (3) the defendant’s violation of §1962.
RWB Servs., LLC v. Hartfort Computer Grp., Inc., 539 F.3d 681,
685 (7th Cir. 2008).
Plaintiffs’ claim against the City, the sole defendant, must be
dismissed because “[m]unicipalities are not liable for civil RICO
claims.” Lathrop v. Juneau & Assocs., Inc. P.C., 220 F.R.D. 330,
334-35 (S.D. Ill. 2004) (citing Gentry v. Resolution Trust Corp., 937
F.2d 899, 914 (3rd Cir. 1991)). The Court further notes that, at the
very least, Plaintiffs have failed to allege injury to their business or
property. In fact, the state court decision of which this Court took
judicial notice shows that Plaintiffs succeeded in the state court
case. The state court ordered the liens released and ordered the
City to pay Plaintiffs’ costs totaling $465. As such, it appears that
Plaintiffs cannot allege an injury. See, e.g., Doe v. Roe, 958 F.2d
763, 767–68 (7th Cir. 1992) (noting that a “civil RICO action cannot
be premised solely upon personal or emotional injuries”).
Therefore, upon de novo review, the Court dismisses the RICO
claim against the City for failure to state a claim. Plaintiffs did not
raise specific objections to remaining claims addressed by the
Report and Recommendation. The Court finds no clear error in the
Judge Schanzle-Haskins findings, analysis, or conclusions on the
remaining claims, including Plaintiffs’ proposed amended claims.
The Court will, however, afford Plaintiffs an opportunity to
replead the civil RICO claim. If Plaintiffs choose to do so, Plaintiffs
may also replead their state law claims for violations of the Illinois
Fair Debt Collection Practices Act and the Illinois Consumer Fraud
and Deceptive Business Practices Act because the Court would
likely have supplemental jurisdiction of those state law claims if
Plaintiffs can plead a federal claim.
IT IS THEREFORE ORDERED THAT:
(1)
The Report and Recommendation (d/e 19) is ACCEPTED
IN PART and MODIFIED IN PART. The City’s Renewed Motion to
Dismiss (d/e 13) is GRANTED, and Plaintiffs’ Motion to Amend (d/e
17) is DENIED. Plaintiffs’ Motion to Bifurcate (d/e 22) is DENIED
AS MOOT.
(2)
Plaintiffs’ due process, equal protection, and Fourth
Amendment claims are dismissed with prejudice for failure to state
a claim. Plaintiffs’ request to amend their complaint to add a claim
for a violation of the federal Fair Debt Collection Practices Act is
denied because the proposed amendment would be futile. The civil
RICO claim and the state law Illinois Fair Debt Collection Practices
Act and the Illinois Consumer Fraud and Deceptive Business
Practices Act claims are dismissed without prejudice and with leave
to replead.
(3)
If Plaintiffs choose to file an amended complaint in this
Court, Plaintiffs shall file said amended complaint on or before April
3, 2019. An amended complaint supersedes and replaces the
original complaint. If Plaintiffs do not file an amended complaint,
the Court will close this case.
ENTER: March 20, 2019
FOR THE COURT:
s/ Sue E. Myerscough
SUE E. MYERSCOUGH
UNITED STATES DISTRICT JUDGE
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