Burruss et al v. Cook County Sheriff's Office et al
Filing
297
MEMORANDUM Opinion and Order Signed by the Honorable Rebecca R. Pallmeyer on 7/15/2013: Mailed notice (etv, )
UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
WILLIAM BURRUSS, et al.,
)
)
Plaintiffs,
)
)
v.
)
)
COOK COUNTY SHERIFF’S OFFICE,
)
COUNTY OF COOK, SHERIFF TOM DART, )
SCOTT KURTOVICH, DENNIS ANDREWS,
)
MICHAEL HOLMES, SALVADOR GODINEZ, )
and GILBERTO ROMERO, JR.,
)
)
Defendants.
)
No. 08 C 6621
Judge Rebecca R. Pallmeyer
MEMORANDUM OPINION AND ORDER
Plaintiffs, 21 correctional officers employed by the Cook County Sheriff’s Office, once worked
as part of a specialized unit, the Special Operations Response Team (“SORT”), in the Cook County
Jail. SORT was disbanded in 2006. In this lawsuit, Plaintiffs allege that Defendants—the Cook
County Sheriff’s Office, and several officials of that office—disbanded SORT to retaliate against
Plaintiffs for having supported Richard Remus in his unsuccessful 2006 primary bid against Tom Dart,
the Cook County Sheriff. Plaintiffs brought this action under 42 U.S.C. § 1983, charging that
Defendants violated their First Amendment rights by disbanding SORT.
At the conclusion of a three-week trial last year, the jury found for Plaintiffs against the Cook
County Sheriff’s Office (“the County” or “Cook County”) and a single individual Defendant—Scott
Kurtovich, who worked temporarily as Acting Executive Director of the County’s Department of
Corrections and then as its First Assistant Executive Director. The jury awarded more than $1.3
million in total compensatory damages as well as $210,000 in punitive damages against Defendant
Kurtovich. (Minute Entry 9/4/12 [189].) Defendants Cook County and Kurtovich now move for
judgment notwithstanding the verdict under Rule 50(b). (Defs.’ Mot. & Mem. of Law in Support of
J. Notwithstanding the Verdict [192], hereinafter “Defs.’ Mot.”, at 2.) Defendants argue that
(1) Plaintiffs did not prove that their support for Remus in the primary election was a motivating
factor in Defendants’ decision to disband SORT; (2) even if the decision was politically motivated,
Defendants are not liable because SORT would have been disbanded anyway; and (3) the
evidence was insufficient to support an award of punitive damages against Kurtovich. Defendants
also contend that certain Plaintiffs lacked standing because they failed to disclose their interests
in this case in bankruptcy. For the reasons explained below, Defendants’ motion [192] is granted
in part and denied in part.
Plaintiffs’ motions to join Plaintiff Ross’s and Plaintiff Vlahos’s
bankruptcy Trustees [242 and 243] are granted.
FACTUAL BACKGROUND
SORT was created in the mid-1990’s and consisted of a cadre of specially-trained officers
who were assigned a variety of specialized tasks in the County’s Department of Corrections
(“DOC”), including transporting high-risk inmates to other correctional facilities and court hearings,
conducting “shake-downs” of prison cells for contraband, serving as firearms instructors at the
training academy, assisting the Chicago Police Department during protests, and patrolling the DOC
compound perimeter. SORT was known within the DOC as a close-knit group whose members
supported each other personally.
Burruss v. Cook Cnty. Sheriff’s Office, No. 08 C 6621,
2011 WL 856635, *1 (N.D. Ill. Mar. 9, 2011).
While working as SORT members, Plaintiffs engaged in various political activities in support
of Richard Remus’s candidacy for Cook County Sheriff in the 2006 Democratic primary election.
Plaintiffs testified at trial that their support for Remus—who headed SORT for a time—was
well-known throughout the Department of Corrections. Plaintiffs also testified that several County
command staff members who were potentially involved with the decision to disband SORT
commented unfavorably to Plaintiffs about their support for Remus. Among other allegations,
Plaintiffs asserted that (1) DOC Superintendent Michael Holmes asked certain Plaintiffs about their
2
support for Remus at a SORT picnic and told Gilberto Romero, the DOC Assistant Executive
Director of Security, that the SORT unit was “not loyal”; (2) Kurtovich told Plaintiff Paul Castellano
that by backing Remus, Plaintiffs were “betting on the wrong horse”; (3) a supervisor told Plaintiff
Chuck Canada that he could be disciplined for collecting signatures for Remus on election-related
petitions at Morraine Valley College while Canada was off-duty; (4) a captain at the DOC warned
Plaintiffs to “be careful supporting Remus – they [Defendants] are watching you guys”; and
(5) DOC Superintendent Thomas Snooks informed Plaintiff Anthony Lordo that Kurtovich had
expressed his desire in command staff meetings before SORT’s disbandment to “get rid of all
things Remus.”
After SORT was disbanded, Defendants created a new specialized unit in the DOC, the
Emergency Response Team (“ERT”). Plaintiff Matt Vlahos asserted that, after the formation of ERT
in 2007, an ERT lieutenant told him that SORT members would not be admitted to the ERT unit
because of their previous political support for Remus. (Pls.’ Resp. to Defs.’ Rule 50(b) Mot. [237],
hereinafter “Pls.’ Resp.”, at 6-8; Vlahos Testimony, Ex. 3 to Pls.’ Resp., at 42:4-24.) Plaintiff Lordo
also testified that then-DOC Assistant Executive Director of External Operations Dennis Andrews,
who was present in conversations among command staff about disbanding SORT, told SORT
members sometime during the three-month period before the unit was officially disbanded that SORT
was being disbanded for political reasons. (Lordo Dep., Ex. M to Pls.’ Mot. to File Pls.’ Resp. to Defs.’
Mot. for Summ. J. [87], hereinafter “Pls.’ Summ. J. Resp.”, at 15:16-24, 16:1-9.)
The record provides little detail about Remus, but it is undisputed that he was once himself
a SORT officer and that he commanded the loyalty of most of his fellow SORT members. The
2006 Democratic primary election for Cook County Sheriff was held on March 21, 2006. Remus
lost. Remus’s opponent in the election, Tom Dart, became Sheriff after the general election in
November 2006. At some point after the primary election, Kurtovich—who served as the DOC’s
Acting Executive Director from November 2004 to June 2006 before becoming the DOC’s First
3
Assistant Executive Director1—recommended disbanding SORT. (Defs.’ 56.1 [64-3] ¶ 5.) The
record does not specify when or to whom Kurtovich allegedly first made this recommendation
beyond testimony from Plaintiffs that they heard rumors that he had expressed an intention to make
this recommendation to other DOC managers. The decision to disband SORT was the central
focus of Plaintiffs’ claim; they asserted that the decision was made to retaliate against them for
backing Remus in the primary and that Kurtovich was a key player in that decision. Despite this
focus, there was limited evidence at trial about when and how the decision was made.
It is undisputed that SORT was officially disbanded on November 19, 2006 under the
direction of DOC Executive Director Salvador Godinez. (Defs.’ Mot. at 4.) The parties do dispute
the extent of Godinez’s role as decision-maker in disbanding SORT. Godinez became the
Executive Director in June 2006, and had been in his post for just five months when SORT was
disbanded. He testified at trial that (1) he was not aware of Plaintiffs’ political affiliation; (2) he
decided to disband SORT because of DOC operational needs and SORT’s “counterproductive”
culture; and (3) his decision was not influenced by any improper considerations. Defendants view
this testimony as unrebutted. (Defs.’ Mot. at 8; Def. Scott Kurtovich’s Supplement to the Rule
50(b) Mot. [234], hereinafter “Kurtovich’s Supp.”, at 1; Defs.’ Am. Reply Brief [254-1], hereinafter
“Defs.’ Reply”, at 2-6.) As Plaintiffs emphasize, however, Godinez’s testimony on this score was
effectively impeached, as he admitted in his deposition that the decision to disband SORT
“absolutely” was made before he became Executive Director, though he was “prepared to go
forward with it.” (Pls.’ Resp. at 10.) No documentary evidence sheds light on the nature of
Godinez’s involvement in the decision.
At the conclusion of the evidence, the court gave instructions about liability under the First
1
The record does not specify why Kurtovich was named Acting Executive Director.
4
Amendment in language substantially proposed by Plaintiffs. (8/27/12 Minute Entry [178].)2 On
the third day of deliberations, the jury sent a note in which they expressed concern that the
instructions appeared to permit the “guilty individual(s) . . . to politically discriminate at will so long
as SORT would have been disbanded anyway” and asked for confirmation of whether that was
accurate.
(8/30/12 Jury Note [192-1].)
The court sustained Defendants’ objection to any
substantive response to this question, instead directing the jury to re-read and consider the
instructions it had been given and to continue deliberations. (Defs.’ Mot. at 2; Pls.’ Emergency Mot.
for Clarification [184] at 1-2.) Several days later, the jury found in favor of Plaintiffs and against the
County and Kurtovich, but entered findings in favor of Godinez and two other DOC officials.
Defendants moved for a directed verdict under Federal Rule of Civil Procedure 50(a) before
the jury verdict. They now renew their request in a Rule 50(b) motion for judgment notwithstanding
the verdict. Defendants offer a variety of arguments for overturning the verdict, including that
(1) Kurtovich is entitled to qualified immunity; (2) no rational jury could find that Defendants
retaliated against Plaintiffs for their political support for Remus; and (3) the punitive damages
awarded against Kurtovich are inappropriate. In addition, Defendants argue that six of the Plaintiffs
lack standing to seek any recovery because they failed to properly disclose their claims in
bankruptcy filings. The court examines each argument in turn.
DISCUSSION
Standard for a Rule 50(b) motion
Judgment as a matter of law is appropriate when a party has been fully heard on an issue
2
The jury instructions stated: “Plaintiffs must show by a preponderance of the
evidence: (1) Plaintiffs supported . . . Remus during the [election]; (2) Plaintiffs’ political support . . .
for Richard Remus was a reason, alone or with other reasons, that the Defendants relied on when
they disbanded [SORT] or that moved the Defendants toward the decision to disband [SORT]; and
(3) Plaintiffs suffered harm.” Jury Instructions [191], at 20. The instructions added: “If you find that
the Defendants would have disbanded [SORT] even in the absence of Plaintiffs’ political support
or perceived political support for Richard Remus, then your verdict should be for Defendants.” Id.
5
and there is “no legally sufficient evidentiary basis for a reasonable jury to find for that party.”
Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 149 (2000) (quoting FED. R. CIV. P. 50(a)).
A Rule 50(b) motion renews a pre-verdict Rule 50(a) motion, and is considered under the same
standard. The court “construe[s] the facts strictly in favor of the party that prevailed at trial” by
“drawing all reasonable inferences in that party’s favor and disregarding evidence favorable to the
moving party that the jury is not required to believe.” May v. Chrysler Group, LLC, 716 F.3d 963,
971 (7th Cir. 2013) (affirming denial of defendant’s motion for judgment as a matter of law)
(citations and internal quotation marks omitted). The court’s assessment of the nonmoving party’s
evidence should be “highly charitable.” Id. The court will set aside the jury’s verdict for Plaintiffs
only if “no rational jury” could have found in their favor. Waite v. Bd. of Trs. of Ill. Cmty. Coll. Dist.
No. 508, 408 F.3d 339, 343 (7th Cir. 2005) (citations and internal quotation marks omitted).
I.
Defendants’ Liability
A.
Qualified Immunity
Defendants first argue that Plaintiffs did not show that Kurtovich—the only individual Defendant
found liable by the jury—violated any of Plaintiffs’ clearly established rights.3 In support, Defendants
cite Hernandez v. Sheahan, a case involving a challenge by other SORT members to the County’s
decision to investigate them after six inmates escaped from a special unit of the Cook County Jail
in 2006. (Defs.’ Mot. to Supplement Its Rule 50(a) and 50(b) Mots. [283], hereinafter “Defs.’ Supp.”,
at 2, 6, citing Hernandez, 711 F.3d 816 (7th Cir. 2013).) The Hernandez plaintiffs argued that they were
investigated in retaliation for their political support for Remus in the 2006 Democratic primary election.
3
The County (which is not eligible for qualified immunity) was the first to contend that
Kurtovich is entitled to qualified immunity [283], but Kurtovich later adopted that argument in his
own motion [290]. See Owen v. City of Independence, 445 U.S. 622, 657, 100 S. Ct. 1398, 1418
(1980) (holding that municipalities have no immunity from damages for constitutional violations
under section 1983); Hernandez v. Sheahan, 455 F.3d 772, 776 (7th Cir. 2006) (“[U]nits of
government are not entitled to [qualified] immunity in suits under § 1983.”).
6
Rejecting this contention, the Seventh Circuit concluded that the six violent felons’ escape from custody
gave the County probable cause for investigating the SORT members. Because it was “objectively
reasonable to investigate officers implicated in a multi-felon jailbreak,” the Seventh Circuit observed, the
defendants were shielded by qualified immunity. Hernandez, 711 F.3d at 818.
In reaching its decision, the Seventh Circuit noted that one of the officers who was
investigated confessed to having assisted the inmates’ escape and implicated the other plaintiffs
in a signed statement that a state court ruled was voluntary. In light of the fact that the defendants
in Hernandez had probable cause to investigate the SORT officer plaintiffs, the court was “less
concerned about other possible motivations for [defendants’] treatment [of plaintiffs].” Id. In the
case before this court, Kurtovich contends that the inmate escape discussed in Hernandez similarly
provided an objective and reasonable basis for disbanding SORT in 2006. (Defs.’ Supp. at 3.) In
Kurtovich’s view, Hernandez establishes that there was an objectively reasonable justification for
disbanding SORT—the jail break—and he is therefore shielded by qualified immunity. (Id.)
Hernandez does not provide a basis on which this court can set aside the jury’s verdict,
however, for several reasons. Most significantly, the evidence discussed in Hernandez was not
admitted at trial in this case because Plaintiffs moved in limine [154] to bar it, and the court granted
that motion. In support of barring the evidence, Plaintiffs noted that “[n]one of the Plaintiffs . . .
were on duty during the escape;” that “Defendants have not asserted as a defense that SORT was
disbanded due to the escape;” that “Defendants have not produced any documents relating the
escape to the disbanding of SORT;” and that “[n]one of the Plaintiffs were charged with any
misdeeds relating to the escape.” (Motion in Limine No. 2 [154-1] at 2.) As Defendants did not
disclose the escape as a basis for their decision during discovery, they may not raise the matter
now, post-trial, as a basis for overturning the jury’s verdict.
In any event, even if evidence about the escapes had been admitted, the circumstances
in this case are distinguishable.
After a major breach of security and inmate escape, the
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Hernandez defendants decided to investigate SORT members identified by a fellow officer as
having been involved. The Hernandez defendants had a direct and specific explanation for their
investigation—in marked contrast to this case, where Defendants have offered no documentary
evidence of their reasons for disbanding the entire SORT unit, or the process by which that
decision was made. Nor does Godinez’s general testimony that he disbanded SORT because of
“operational needs” and SORT’s “counterproductive” culture rise to the same level of objective
reasonableness as the facts in Hernandez. (Defs.’ Supp. at 4.) The Seventh Circuit’s recent
decision in Hernandez does not entitle Kurtovich or any other Defendant to qualified immunity.4
B.
Evidence of Retaliation
Defendants next contend that Plaintiffs failed to establish that their support for Remus was
a motivating factor in Defendants’ decision to disband SORT. (Defs.’ Mot. at 4.) A “motivating factor”
is one that is a “sufficient condition” for an adverse action. Greene v. Doruff, 660 F.3d 975, 978
(7th Cir. 2011) (discussing causation in First Amendment cases).5 In pressing their insufficiency-ofthe-evidence argument, Defendants characterize the evidence of a political motivation as no more
than “numerous random incidents and occurrences taking place subsequent to [Plaintiffs’] political
activities.” (Defs.’ Mot. at 4.) These “miscellaneous occurrences” of Defendants’ perceived
negative treatment of Plaintiffs are unrelated to the disbandment of SORT, Defendants insist,
4
In light of this disposition, the court does not address Plaintiffs’ contention that
Defendants waived their qualified immunity argument by failing to raise it in motions after summary
judgment. The court also declines to address Defendants’ contention that Plaintiffs have not shown
that they suffered an adverse action within the meaning of section 1983 because Defendants only
argued it in a reply brief [249] they have since withdrawn. (3/5/13 Minute Entry [263].)
5
In Univ. of Tex. Sw. Med. Ctr. v. Nassar, 133 S. Ct. 2517 (2013), the Supreme Court
held that retaliation claims brought under Title VII must be proved according to traditional principles
of but-for causation. First Amendment retaliation claims in this Circuit remain governed by the Mt.
Healthy test. See Mt. Healthy, 429 U.S. at 287; see generally Smith v. Wilson, 705 F.3d 674 (7th
Cir. 2013); Peele v. Burch, No. 12-3562, ___ F.3d ___, 2013 WL 3455705, *3 (7th Cir. July 9,
2013) (reversing summary judgment for defendant where detective alleged he was transferred for
political reasons). .
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because Plaintiffs “provide nothing to connect Kurtovich to any of their complaints.” (Id. at 5.) For
example, Defendants argue that statements made by County employees other than Kurtovich are
“irrelevant” and do not qualify as evidence of Kurtovich’s retaliatory motivation. (Id. at 7, citing
Aungst v. Westinghouse Elec. Corp., 937 F.2d 1216, 1221 (7th Cir. 1991) (“Statements by inferior
employees are not probative of an intent to discriminate by the decisionmaker” under the ADEA)
and Jardien v. Winston Network, Inc., 888 F.2d 1151, 1155 (7th Cir. 1989) (actions and comments
by employees not involved in a discharge decision do not evidence discrimination in that decision).)
With respect to statements made by Kurtovich himself, Defendants contend that those
statements are insufficient evidence of retaliation because they are too “isolated” and “attenuated”
to establish an intent to retaliate against Plaintiffs for their political activities. (Defs.’ Mot. at 8, citing
Williams v. Seniff, 342 F.3d 774, 790 (7th Cir. 2003) (isolated comments are probative of unlawful
intent only if they are contemporaneous with or causally related to the challenged decision).)
Plaintiffs assert, for example, that Kurtovich told Plaintiff Castellano that he was backing “the wrong
horse” by supporting Remus. (Pls.’ Resp. at 6-8.) Defendants reply that the statement, if Kurtovich
actually made it, was not connected to the decision to disband SORT. (Defs.’ Mot. at 8.)
Castellano testified that he told Kurtovich during conversations in December 2005 and March 2006
outside the SORT command post that he (Castellano) was supporting Remus in the election for
Sheriff, and Kurtovich responded to those comments only by saying that Castellano was “betting
on the wrong horse, that [Remus] didn’t stand a chance.” Trial Tr. 8/22/12 1731:1-4, 1732:14-15.
Castellano did not perceive the comment as a threat or a warning at the time, and characterized
the conversation as “no big deal.” Id. at 1732:15-16. Plaintiff Michael O’Connell similarly testified
that, in a conversation just one week before the election, Director Andrews said SORT members
were “backing the wrong horse” by supporting Remus.
Trial Tr. 8/22/12 1758:22-1759:5.
O’Connell perceived that statement not as a threat but as “just out of pity.” Id. at 1779:23-24.
Plaintiffs note other comments about Remus that they deem more troubling evidence of
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retaliatory intent. Plaintiff Lordo testified that Superintendent Snooks acknowledged, years later,
that Kurtovich had wanted “to get rid of” everything associated with Remus. (Pls.’ Resp. at 6-8.)
Specifically, in a conversation in Superintendent Snooks’s office early in 2010, Lordo asserted,
Superintendent Snooks “ma[de him] aware” that during the course of monthly superintendent
meetings before SORT was disbanded, “Kurtovich was adamant about getting rid of SORT.”
Trial Tr. 8/15/12 886:22-888:7. Lordo also testified that on August 15, 2010, Superintendent
Snooks reported to him that, during those superintendent meetings before SORT’s disbandment,
“Kurtovich [had been] yelling and screaming about how he wanted to get rid of SORT and
everything that Remus had anything to do with.” Id. at 918:18-23.
This evidence is insufficient to establish an intent to retaliate, Defendants contend. They
cite Brown v. Cnty. of Cook, where the Seventh Circuit held that a statement by a Sheriff’s
Department employee that another employee should “call [his] clout” was not enough evidence for
a political affiliation retaliation claim because the context did not make clear that the statement
referred to impermissible political clout. 661 F.3d 333, 336 (7th Cir. 2011). In Defendants’ view,
neither Kurtovich’s alleged statements regarding SORT and the 2006 primary election, nor the fact
that SORT was disbanded after the primary election is sufficient to support an inference of
retaliation. They urge that Plaintiffs presented neither a “pattern of political discrimination” nor any
“direct testimony showing that the decisionmaker was looking to get rid of a political opponent.”
(Defs.’ Mot. at 4.) Even if the jury did not believe the reasons Defendants offered for disbanding
sort, Defendants believe the verdict is flawed because Plaintiffs did not provide enough evidence
of their own. (Defs.’ Am. Reply Brief in Supp. of J. Notwithstanding the Verdict [261], hereinafter
“Cnty.’s Reply to Pls.’ Resp.”, at 11.)
A reasonable jury could have reached a different result on this record, but the court is not
inclined to disturb the verdict on that basis. The evidence surrounding the decision-making process
was murky, but the jury reasonably could have interpreted statements by Kurtovich and other County
10
employees involved in it as evidence of a retaliatory intent. Particularly given the dearth of evidence
about when, how, or by whom the decision to disband SORT was made, the jury could reasonably
have concluded that, in disbanding SORT, Defendants intended to retaliate against Plaintiffs for
supporting Remus.
See Cloe v. City of Indianapolis, 712 F.3d 1172, 1184 (7th Cir. 2013)
(Hamilton, J., concurring) (noting the troubling “absence of an identified decision-maker and reason”
for defendant employer’s decision to discipline and terminate disabled employee). The jury weighed
considerable testimony from Plaintiffs that (1) their support for Remus was well-known at DOC,
including by Kurtovich; (2) Kurtovich himself supported Remus’s opponent, Tom Dart; and (3)
Kurtovich subjected Plaintiffs to negative treatment—most notably the disbandment of SORT—soon
after that primary election. (See, e.g., Kurtovich Dep., Ex. BB to Pls.’ Summ. J. Resp. at 128:9-22
(Kurtovich learned through “scuttlebutt” that SORT members supported Remus); Defs.’ Resp. to Pls.’
Addn’l Facts [102] ¶ 26 (Kurtovich financially supported Dart’s campaign); Lordo Dep. 9:13-24,
16:1-13 (DOC Assistant Executive Director of External Operations Andrews told SORT members that
the disbandment of SORT was political).) In essence, Defendants now ask the court to disregard the
jury’s findings about the credibility and weight of the parties’ evidence. The court declines. While
arguably limited and imperfect, the evidence at trial here was sufficient for a reasonable jury to
conclude that impermissible political motivations undergirded the statements Plaintiffs described
hearing about their support for Remus from County employees and the decision to disband SORT.
C.
Evidence of Alternative Causes for SORT’s Disbandment
Defendants argue that, even if Plaintiffs established a prima facie case, the verdict must
be overturned because SORT would have been disbanded regardless of any retaliation against
Plaintiffs for their political affiliation with Remus. See Greene, 660 F.3d at 979 (citing Mt. Healthy
Bd. of Educ. v. Doyle, 429 U.S. 274, 287, 97 S.Ct. 568, 576 (1977) (burden-shifting analysis)). As
support, Defendants cite Brown v. Cnty. of Cook, where the Seventh Circuit considered a claim
11
brought by a Sheriff’s sergeant that Cook County failed to promote him because of his political
affiliation. In Brown, the Seventh Circuit upheld summary judgment for the defendant because the
plaintiff failed to provide adequate evidence that he was denied promotion because of his political
affiliation. The Seventh Circuit noted, however, that even if the plaintiff had met his initial burden,
the defendant could have prevailed by showing that the plaintiff “would have been denied promotion
[anyway] for some other reason . . . [so] his political affiliation had no causal significance.” (Defs.’
Mot. at 3, citing 661 F.3d 333, 335 (7th Cir. 2011).) Here, too, Defendants urge, any political
motivations had no causal significance because there were sufficient “nonpolitical ground[s]” for
disbanding SORT. (Defs.’ Mot. at 8-9, citing Brown, 661 F.3d at 337 (“[A]ny nonpolitical ground
that the defendant can prove would have caused the discrimination regardless of the presence of
political hostility will preclude liability.”) (emphasis in original).)
Defendants insist that Godinez’s authority as Executive Director to reverse any disbandment
plan and his testimony that he was not influenced by Plaintiffs’ political activities shows that SORT
would have been disbanded regardless of Plaintiffs’ support for Remus. (Defs.’ Mot. at 8-9.)
According to Defendants, Godinez, who testified he was unaware of Plaintiffs’ political inclinations,
was the true decision-maker because, as Executive Director, he “could have stopped the process
of disbanding SORT, but did not.” (Id. at 9.) As Defendants interpret the evidence, Plaintiffs did
not rebut Godinez’s testimony that he made an independent decision to disband SORT that was
not based on Kurtovich’s retaliatory suggestions. (Kurtovich’s Supp. at 1; Defs.’ Reply at 2-6,
Defs.’ Mot. at 8.) Defendants emphasize Godinez’s trial testimony that he disbanded SORT
because of “efficiency and safety” concerns and that he “never saw SORT team members doing
much of anything.” (Kurtovich’s Supp. at 6.) Defendants argue, in short, that they should prevail
on their motion because Godinez was not aware of Plaintiffs’ political loyalties and disbanded
SORT for valid reasons unrelated to Plaintiffs’ First Amendment activities.
The court disagrees. In arguing that Godinez was unaware of Plaintiffs’ political loyalties
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and disbanded SORT for valid non-political reasons, Defendants merely re-state evidence
considered by the jury and contend that no reasonable jury could have rejected that evidence. But
Plaintiffs were not required to rebut Godinez’s testimony in order for the jury to find in their favor.
Neither party is entitled to judgment as a matter of law when a case turns on credibility. Payne v.
Milwaukee Cnty., 146 F.3d 430, 433 (7th Cir. 1998) (“When a case turns on credibility, neither side
is entitled to judgment as a matter of law unless objective evidence shows that it would be
unreasonable to believe a critical witness for one side.”) (citations and internal quotation marks
omitted). In this case, the jurors certainly understood that valid independent reasons for disbanding
SORT would defeat Plaintiffs’ case: they expressed their discomfort with that principle in a note
during their deliberations.6 Defendants did not convince the jury that SORT would have been
disbanded regardless of any political affiliation retaliation, and Plaintiffs were not required to rebut
each piece of evidence offered by Defendants in order to prevail.
To the contrary, the jury was free to discredit Godinez’s testimony even if that testimony had
been uncontested. See, e.g., Kasper v. Saint Mary of Nazareth Hosp., 135 F.3d 1170, 1173
(7th Cir. 1998) (jurors are not compelled to credit even uncontroverted testimony); EEOC v. G-K-G,
Inc., 39 F.3d 740, 746 (7th Cir. 1994) (a jury has the prerogative “to disbelieve uncontradicted
testimony unless other evidence shows that the testimony must be true”). Given the jury’s verdict,
it is not “pure speculation,” as Defendants claim, to conclude that the jury chose not to believe all
of Godinez’s testimony. (Cnty.’s Reply to Pls.’ Resp. at 6.) Defendants argue that this case is like
Passananti v. Cook Cnty., where there was “simply no evidence” to support the plaintiff’s claims
that her position was eliminated because of gender discrimination. 689 F.3d 655, 675 (7th Cir.
6
As described earlier, the instructions told the jurors: “If you find that the Defendants
would have disbanded [SORT] even in the absence of Plaintiffs’ political support or perceived
political support for Richard Remus, then your verdict should be for Defendants.” Jury Instructions
[191], at 20. In their note, the jurors observed that the instructions appeared to permit the “guilty
individual(s) . . . to politically discriminate at will so long as SORT would have been disbanded
anyway.” 8/30/12 Jury Note [192-1].
13
2012). In this case, in contrast, the process Defendants used to disband SORT was largely
unexplained—Defendants offered no evidence of any meetings, discussions, formal plans, or even
post-hoc documentation of their decision—and Plaintiffs presented testimonial evidence of possible
retaliatory intent. See Lust v. Sealy, Inc., 383 F.3d 580, 583 (7th Cir. 2004) (affirming that if a
plaintiff in a discrimination suit offers evidence, the jury is free to disbelieve the defendant’s
contrary evidence).
Kurtovich also contends that there is no causal connection between his own conduct and
the disbandment of SORT because “[t]he appointment of Godinez to take over for Kurtovich
severed the causal link because [disbanding SORT] was Godinez’s decision alone to implement.”
(Kurtovich’s Supp. at 5.) Kurtovich urges that harm to Plaintiffs from SORT’s disbandment was
only possible after “someone other than . . . Kurtovich made an independent assessment and
enacted the recommendation [to disband SORT].” (Def. Kurtovich’s Reply In Support of the
Rule 50(b) Mot. [278], hereinafter “Kurtovich’s Reply”, at 3.) Again, the court disagrees. First, as
noted earlier, Godinez testified at his deposition that the decision was made prior to his tenure, and
he merely carried it out. Even if the jury credited his trial testimony that he did make the decision,
the jury could reasonably have concluded that Kurtovich’s encouragement contributed to SORT’s
demise. See, e.g. Schandelmeier-Bartels v. Chi. Park Dist., 634 F.3d 372, 381 (7th Cir. 2011)
(citing “cat’s paw” theory of liability). In any event, the fact that the allegedly unbiased Godinez
possessed the authority to alter or reverse the plan to disband SORT does not require the
conclusion that Defendants are absolved of liability. If unconstitutionally-conceived plans could be
corrected by simply bringing in a neutral supervisor to implement them, then constitutional
protections would be spineless. The jury could well have concluded that even if Godinez had the
authority to reverse or modify the disbandment plan, SORT would not have been disbanded absent
a political motivation.
For similar reasons, the court is not moved by Defendants’ interpretation of the jury’s
14
August 30, 2012 note. As Defendants interpret the message, the jury’s request for confirmation
that Defendants would not be liable for retaliation if SORT would have been disbanded anyway
shows that the jury “understood the law with respect to the First Amendment claim . . . [but] chose
to ignore the law and the instruction by the Court.” (Cnty.’s Reply to Pls.’ Resp. at 9.) According
to Defendants, the jury’s verdicts in favor of Godinez but against Kurtovich and the Sheriff’s Office
are in “obvious conflict” with each other and therefore “cannot stand.” (Defs.’ Mot. at 14.) Plaintiffs
presented evidence that the plan to disband SORT was originally Kurtovich’s idea, however; a
reasonable juror could decide that Godinez’s execution of the disbandment plan was not enough
to subject him to liability, but that Kurtovich’s actions were sufficient to impose liability on him as
well as the County. See Lust v. Sealy, Inc., 277 F. Supp. 2d 973, 979 (W.D. Wis. 2003) aff’d as
modified 383 F.3d 580 (7th Cir. 2004) (“If a reasonable view of the evidence—not necessarily the
most reasonable—supports the jury’s findings, a Rule 50(b) motion must be denied.”).
The County is liable under section 1983, just as Kurtovich is individually, because the jury
found that the County made an official decision to disband SORT in retaliation against Plaintiffs.
See Monell v. Dep't of Soc. Servs. of N.Y.C., 436 U.S. 658, 690-91, 98 S. Ct. 2018, 2035-36 (1978)
(“Local governing bodies” can be held liable for unconstitutional actions that implement “a policy
statement, ordinance, regulation, or decision officially adopted and promulgated by that body's
officers.”); Owen v. City of Independence, 445 U.S. 622, 657, 100 S. Ct. 1398, 1418 (1980)
(municipalities are not immune from liability for damages flowing from constitutional violations under
section 1983). The court therefore will not set aside the jury’s liability findings against Defendants.7
7
Since the court rejects Defendants’ request to set aside the jury’s liability finding,
it does not respond to Plaintiffs’ contention that Defendants waived their argument that Godinez’s
decision-making was an independent cause of SORT’s disbandment or that the burden-shifting
analysis for retaliation cases is irrelevant after trial. (Pls.’ Resp. at 2.)
15
II.
Punitive Damages Against Kurtovich
As noted, the jury awarded more than $200,000 in punitive damages against Defendant
Kurtovich individually. Punitive damages are appropriate when a defendant acted wantonly and
willfully or was motivated by ill-will or a desire to injure. Hendrickson v. Cooper, 589 F.3d 887, 894
(7th Cir. 2009) (citations and internal quotation marks omitted). Kurtovich argues that the court
should vacate the jury’s award of punitive damages because his actions do not meet this standard.
Alternatively, he argues that Plaintiffs have not proved that his actions meet the standard for
punitive damages in regard to each individual Plaintiff. In assessing these challenges, the court
addresses, first, the propriety of an award of punitive damages in this case and, second, the size
of the award.
A.
Appropriateness of Punitive Damages
Defendants first argue that Kurtovich is not liable for punitive damages because SORT was
disbanded by Godinez, not Kurtovich. (Kurtovich’s Supp. at 7.) Because he did not make the
ultimate decision to disband SORT, Kurtovich urges, he did not have the requisite involvement for
punitive damages. (Kurtovich’s Reply at 4.) This argument effectively repeats Defendants’
challenge to the verdict itself, a challenge the court has already addressed. As explained earlier,
though Godinez was in charge when the decision was implemented, the jury was entitled to find that
Kurtovich acted willfully when he suggested, as the interim Executive Director, that SORT be
disbanded. At a minimum, if Kurtovich did not make the final decision to disband SORT, there was
evidence at trial that he facilitated or encouraged it. (Pls.’ Resp. to Defs.’ Supplemental Rule 50(b)
Mots. [260], hereinafter “Pls.’ 2d Resp.”, at 11.) In light of the paucity of evidence about how and
by whom the decision to disband SORT was made, a rational jury could conclude that Kurtovich
played enough of a role in the decision to disband SORT for political reasons to support an award
for punitive damages.
16
Defendants next argue that there was insufficient evidence that Kurtovich’s actions were
wanton or willful. (Defs.’ Mot. at 14.) Punitive damages are appropriate only when “the defendant’s
culpability, after having paid compensatory damages, is so reprehensible as to warrant the
imposition of further sanctions to achieve punishment or deterrence.” State Farm Mut. Auto. Ins.
Co. v. Campbell, 538 U.S. 408, 422-23, 123 S. Ct. 1513, 1523 (2003) (noting punitive damages
to punish or deter conduct bearing no relation to plaintiffs’ harm are invalid; punitive damages are
not warranted merely for “being an unsavory individual or business”). A jury may award punitive
damages in a section 1983 action “when the defendant’s conduct is shown to be motivated by evil
motive or intent, or when it involves reckless or callous indifference to the federally protected rights
of others.” Alexander v. City of Milwaukee, 474 F.3d 437, 453 (7th Cir. 2007). Plaintiffs contend
that Kurtovich met the punitive damages standard because he knew it was unlawful to retaliate
against Plaintiffs for their political activities, yet did so anyway. (Pls.’ Resp. at 14.)
As evidence, Plaintiffs cite Plaintiff Castellano’s testimony that Kurtovich said he didn’t “care
if they [SORT members] sue me.” (Pls.’ 2d Resp. at 10.) The court notes that this comment was
made during a conversation at the command post in 2004 in reference to Kurtovich’s refusal to
reimburse SORT members for missing previously scheduled vacations, not to the disbandment of
SORT in 2006. Trial Tr. 8/22/12 1730:8-14. As additional evidence of unlawful intent, Plaintiffs point
to their testimony that other command staff told them that Kurtovich intended to “get rid of all things
Remus.” (Pls.’ 2d Resp. at 10.) The evidence of Kurtovich’s specific intent was limited, but the same
evidence that supports the jury’s verdict is sufficient for a finding that Kurtovich knowingly violated the
law by encouraging the disbandment of SORT in retaliation for Plaintiffs’ support of Remus.
As Defendants correctly point out, however, there was little evidence of actual harm to any
of the Plaintiffs as a result of the actions of Kurtovich or the County.8 Plaintiffs did not lose their
8
Defendants have not challenged the jury's award of compensatory damages, despite
(continued...)
17
jobs or suffer any demotion or loss in base pay. (Defs.’ Mot. at 14.) Kurtovich urges that punitive
damages “should not be awarded because of perceived slights or a plaintiff’s self imposed [sic]
sense of persecution.” (Kurtovich’s Reply at 4.) Punitive damages are aimed at the conduct of a
Defendant, however, not merely the losses suffered by Plaintiffs. A jury can award punitive
damages “to further a State’s legitimate interests in punishing unlawful conduct and deterring its
repetition.” BMW of N. Am., Inc. v Gore, 517 U.S. 559, 568, 116 S. Ct. 1589, 1595 (1996);
Farfaras v. Citizens Bank & Trust of Chi., 433 F.3d 558, 567 (7th Cir. 2006) (punitive damages may
be used to dissuade defendants who are unaffected by compensatory damages from the
misapprehension that they are beyond the reach of civil penalties).
Here, Plaintiffs urge, punitive damages are warranted to deter political retaliation by
Kurtovich in the future. (Pls.’ Resp. at 15; Pls.’ 2d Resp. at 10.) Plaintiffs contend there is a risk
of such misconduct because Kurtovich still possesses “power to have them disciplined,
investigated, harassed, and to make sure that they never advance beyond picking up trash,
passing out bologna sandwiches, and washing inmates underwear.” (Pls.’ Resp. at 14.) The court
does not share Plaintiffs’ apparent belief that an award of punitive damages will (or should)
influence work assignments in the manner Plaintiffs suggest; some of the responsibilities Plaintiffs
disparage are the very jobs for which Plaintiffs, who remain employed as Cook County Correctional
8
(...continued)
the fact that this case appears to be a good candidate for remittitur. Courts review compensatory
damages awards to examine whether (1) they are monstrously excessive; (2) there is no rational
connection between the award and the evidence; and (3) the award is roughly comparable to
awards made in similar cases. Schandelmeier-Bartels, 634 F.3d at 388 (reducing excessive jury
award in Title VII case). Cases involving significant emotional distress damages for lost work
responsibilities often hinge on the credibility of the plaintiffs. See, e.g., Deloughery v. City of
Chicago, 422 F.3d 611, 620 (7th Cir. 2005) (affirming award of significant compensatory damages
for mental and emotional suffering to a police lieutenant who was denied a promotion in retaliation
for filing discrimination complaints because of the district court’s assessment of her demeanor).
After observing the Plaintiffs during trial, this court has grave doubt that their altered work
responsibilities justify awards reaching as much as $350,000 for a single Plaintiff and more than
a million dollars in total compensatory damages. As Defendants have not asked for remittitur,
however, the court need not address the matter further.
18
Officers, were hired and are being paid. Without endorsing Plaintiffs’ hyperbolic assertions, the
court observes simply that a rational jury could conclude that targeted retaliation against Plaintiffs
for their political activity warranted punitive damages and that Kurtovich would be deterred by
having to pay punitive damages in his individual capacity. The court will not set aside the jury’s
decision to award punitive damages against Kurtovich.
Kurtovich also argues that punitive damages should not be awarded against him because
“[u]nder the instructions used by the jury, every individual defendant should have been liable for
punitive damages.” (Kurtovich’s Reply at 4.) Once again, the court disagrees. The jury found in
favor of all of the other individual Defendants on liability. Moreover, whether or not the Defendants
and the court are convinced by the evidence, enough was provided for a reasonable juror to find that
Kurtovich acted with a disregard for Plaintiffs’ rights not shared by the other individual Defendants.
Testimony at trial identified Kurtovich as a leader in the effort to retaliate against Plaintiffs for their
support for Remus in a way that distinguishes him from the other individually named Defendants.
Finally, Kurtovich argues that Plaintiffs did not present evidence of Kurtovich’s mental state
as to each individual Plaintiff. (Kurtovich’s Reply at 5.) This argument plainly fails. Plaintiffs provided
evidence that Kurtovich contributed to disbanding SORT, a single decision which harmed each of the
Plaintiffs individually. Defendants did not move to sever the cases, and both parties litigated the case
as a challenge to a single decision—to disband SORT—rather than a series of decisions that affected
the Plaintiffs individually. By convincing the jury that Kurtovich acted in callous disregard of Plaintiffs’
rights, Plaintiffs proved that each Plaintiff was entitled to punitive damages as a member of SORT
who was harmed by the decision.
B.
Amount
The jury has primary responsibility for determining an appropriate punitive damages award,
but courts have a duty to review awards to make sure that they are not unjustly arbitrary. See
19
Honda Motor Co. v. Oberg, 512 U.S. 415, 432 (1994) (emphasizing the importance of judicial
review in preventing unjust punitive awards that violate the Due Process Clause). In assessing the
reasonableness of a punitive damages award and deciding whether it violates due process, courts
weigh (1) the reprehensibility of defendants’ conduct; (2) the disparity between the harm suffered
by the plaintiff and the award; and (3) penalties authorized in comparable cases. State Farm, 538
U.S. at 418. The first prong of this test—the reprehensibility of the defendant’s conduct—is the
most important factor for assessing the reasonableness of a punitive damages award, and under
it courts consider whether the harm caused was physical or economic; whether the target of the
conduct was financially vulnerable; whether conduct was repeated or an isolated incident; whether
the tortious conduct showed indifference to or reckless disregard of the health or safety of others;
and whether the harm resulted from intentional malice, trickery, or deceit, rather than accident. Id.
at 419.
In this case, the harm caused by Kurtovich was not physical, nor were Plaintiffs financially
vulnerable. Plaintiffs’ complaints about Kurtovich focused largely on the decision to disband SORT,
and a handful of other alleged personnel actions, none of which appeared to impinge on the health
or safety of others in any direct way. Plaintiffs did provide evidence that Kurtovich acted out of
malice, but the reprehensibility of Kurtovich’s conduct provides little support for a punitive damages
award of $210,000.
Looking to the second prong of the punitive damages test—the disparity between the harm
suffered and the award—Plaintiffs contend that “Kurtovich’s actions in disbanding the SORT unit
. . . destroyed Plaintiff’s lives, careers, family relationships, and futures” because they lost their
special status as SORT members. (Pls.’ Resp. at 14.) They urge that the $210,000 in punitive
damages awarded against Kurtovich are therefore justified. (Id. at 9.) The court disagrees.
Plaintiffs lost no pay or employment benefits. They suffered no loss beyond a change in daily job
responsibilities—a change that arguably did nothing more harmful than returning an
20
otherwise-exalted set of officers to the rank and file. Awarding $10,000 per Plaintiff for Kurtovich’s
suggestion that Plaintiffs should suffer the indignity of having to perform general correctional officer
work rather than only “elite” tasks appears excessive. Whatever Plaintiffs may subjectively believe,
they did not establish that changes in their duties and a loss of the so-called “band of brothers”
esprit de corps were solely responsible for the reported loss of self-esteem or shattered personal
relationships described in their trial testimony.9
An award of $210,000 could also impair marginal deterrence. As the Seventh Circuit
reasoned in Lust v. Sealy, if a defendant must pay extensive punitive damages for a relatively
minor discriminatory act then he “has no monetary disincentive . . . to escalate minor into major
discrimination.” 383 F.3d at 591 (reducing punitive damages award in sex discrimination case
where plaintiff was denied a promotion for a mere two months).10 Finally, the court notes that
punitive damages are to be evaluated from the vantage point of the defendant, not that of the
plaintiffs. In the end, the court is unwilling to reinforce Plaintiffs’ unreasonable investment in their
status as SORT officers through an excessive punitive damages award. An award of $10,000 is
enough to sufficiently penalize Kurtovich—a public employee—for his role in disbanding SORT.
The court therefore adjusts the punitive damages award downward to $10,000.
III.
Standing and Judicial Estoppel
The Bankruptcy Code requires debtors to file a list of all assets and liabilities, including
9
Nor is the court fully convinced that the loss of the “band of brothers” mentality
among SORT members was wholly negative: Plaintiffs’ own testimony suggested that the team
ethos of SORT was not healthy for the work of correctional officers hoping to engender cooperation
from inmates.
10
For several reasons—including staffing shortages—maintaining a unit devoted solely
to elite tasks may well have been an abuse of County resources. Godinez testified about several
problems with SORT, though Defendants provided no contemporaneous evidence that any of those
concerns were the actual impetus behind the disbandment decision. The many good reasons why
Defendants might have disbanded SORT are not cause enough to overturn the jury’s verdict, but
they are reasons why, on the merits, disbanding SORT may well have been an appropriate course.
21
pending causes of action, along with a statement of financial affairs. See 11 U.S.C. §§ 521,
541(a)(1). Defendants contend that six Plaintiffs—Javier Rueda, Nelson Lewis, John Nawara,
Samuel Diaz, Glenn Ross, and Matt Vlahos (hereinafter “Bankruptcy Plaintiffs”)—should be barred
from benefitting from their claims because they failed to disclose their interests in this case as
assets in bankruptcy filings.11 Defendants ask the court to take judicial notice of these bankruptcy
filings (Cnty.’s Supp. at 3, citing In re Consol Indus. Corp., 397 F.3d 524, 527 (7th Cir. 2005)), and
argue that the Bankruptcy Plaintiffs’ failure to disclose their interests in this litigation means that
they lack standing or, alternatively, are judicially estopped from benefitting from the verdict.
(Kurtovich’s Supp. at 7-8; Defs.’ Mot. to Join and Supplement Def. Kurtovich’s Rule 50(b)
Mot. [246], hereinafter “Cnty.’s Supp.”, at 2-3; Defs.’ Resp. to Mots. to Join Trustees as Pls. [253],
hereinafter “Defs.’ Resp. to Mots. to Join Trs.”, at 2.)12
A.
Procedural History of Bankruptcy Filings
Plaintiffs initiated this lawsuit on November 18, 2008. (Compl. [1].) Four of the six Bankruptcy
Plaintiffs—Nawara, Ross, Rueda, and Vlahos—subsequently filed for bankruptcy but did not schedule
their interests in this case as assets. (Kurtovich’s Supp. at 9; Defs.’ Resp. To Mots. to Join Trs.
at 2-3.) One of the Bankruptcy Plaintiffs, Lewis, had already filed for bankruptcy when this lawsuit
was initiated. He did not subsequently schedule his interest in this case during the period between
11
Rueda’s case is No. 07-2187 and No. 09-00839. Lewis’s bankruptcy case is
No. 07-10266. Nawara’s bankruptcy case is No. 10-02331. Diaz’s bankruptcy case is
No. 12-37134. Ross’s bankruptcy case is No. 09-5421. Vlahos’s bankruptcy case is No. 09-28169.
12
Plaintiffs argue that Defendants’ bankruptcy arguments are waived because
Defendants did not raise them in their Rule 50(a) motion. (Pls.’ 2d Resp. at 12-13.) Defendants’
bankruptcy-related arguments are not a direct challenge to the verdict, however, so the law on
waiver as it relates to Rule 50 does not apply. Even if that law were relevant, Defendants did not
forfeit their challenge to the Bankruptcy Plaintiffs’ failure to disclose their interests because they
were not aware of that failure until several months after the trial. Defendants did question Plaintiff
Vlahos about his bankruptcy during trial, but they raised that issue only in the sense that they tried
to establish that nothing about their conduct was responsible for his bankruptcy. (Defs.’ Resp. to
Mots. to Join Trs. at 3-4.)
22
when this lawsuit was filed and when he was granted a discharge ten months later. (Kurtovich’s
Supp. at 9.) The final Bankruptcy Plaintiff, Diaz, filed for bankruptcy after Plaintiffs initiated this
lawsuit and disclosed his interest in the suit, but he valued that interest at just $5,000. (Defs.’ Reply
Mem. in Supp. of its Supplemental Rule 50(b) Mot. [279], hereinafter “Defs.’ 2d Reply”, at 10-11.)
Ross and Vlahos sought bankruptcy protection under Chapter 7 of the Code; the other four
Bankruptcy Plaintiffs filed under Chapter 13. (Defs.’ 2d Reply at 10-11; Defs.’ Resp. to Mots. to Join
Trs. at 2.) Vlahos’s bankruptcy case concluded when he received a discharge in November 2009,
but he filed a motion to reopen his bankruptcy in August 2012, three days before the trial in this case
began. (Defs.’ Resp. to Mots. to Join Trs. at 3.) Vlahos submitted amended schedules to the
bankruptcy court disclosing his interest in this suit on August 27, 2012, six days after being
questioned at trial about his bankruptcy. (Id. at 4.)
Rueda’s and Nawara’s bankruptcy cases were dismissed in 2009 and 2010. (Defs.’ 2d
Reply at 10-11.) By early February 2013, several months after trial, Defendants became aware of
the bankruptcy proceedings of Diaz, Rueda, Nawara, Ross, and Lewis and brought them to the
attention of Plaintiffs’ counsel. Diaz filed amended schedules in bankruptcy court to disclose the
verdict in this suit on February 6, 2013. (Kurtovich’s Supp. at 9.) On February 7, 2013, Defendant
Kurtovich submitted a supplemental memorandum in which he made a judicial estoppel argument.
The following day, Rueda moved to reopen his case to file amended disclosures. Nawara also filed
a motion to reopen his case on February 27, 2013. That motion was denied, but Nawara
nevertheless filed amended schedules on March 11, 2013. See In re Nawara, No. 10-02331
(Bankr. N.D. Ill. March 11, 2013). Ross’s Chapter 7 bankruptcy case was concluded on June 1,
2009, but was reopened during the trial on August 14, 2012, and he filed an amended disclosure
on February 11, 2013.
(Cnty.’s Supp. at 3.)
Lewis’s bankruptcy case was concluded on
September 17, 2009, but he moved to reopen it on February 8, 2013. (Id.) All of the Bankruptcy
Plaintiffs have therefore attempted in some fashion to remedy their earlier failures to accurately
23
disclose their interests in this case as assets.
B.
Standing of Plaintiffs Ross and Vlahos
Plaintiff Glenn Ross filed for bankruptcy before this lawsuit began and received a discharge
under Chapter 7 seven months after the suit was filed. Because he did not disclose his interest in
the suit prior to receiving his discharge, Defendants contend he lost standing to recover anything
in this case. (Cnty.’s Supp. at 9-10.) Plaintiff Matt Vlahos also received a discharge under
Chapter 7 while this suit was pending and before he disclosed his interest in it as an asset, though
unlike Ross he did not file for bankruptcy until eight months after this suit was filed. (Defs.’ Resp.
to Mots. to Join Trs. at 2-3.) Defendants contend that Vlahos also lacks standing to recover
anything here because he failed to timely disclose his interest in this suit. (Id. at 6.)
A Chapter 7 bankruptcy debtor’s property becomes the property of a bankruptcy estate, and only
a Trustee of the estate has standing to pursue claims on the estate’s behalf. Matthews v. Potter, 316 F.
App’x. 518, 521 (7th Cir. 2009) (“[I]f a legal claim is not scheduled . . . by the time the bankruptcy is
closed, it forever remains the property of the estate, and the trustee remains the real party in interest.”)
Ross’s and Vlahos’s claims in this case belong to their bankruptcy estates, Defendants urge, and must
now be dismissed because both men failed to list the claims as part of those estates. (Cnty.’s Supp.
at 9-10, citing Kunica v. St. Jean Financial, Inc., 233 B.R. 46, 53 (S.D.N.Y. 1999) (unscheduled claims
must be dismissed because debtor lacks standing to bring them even after emerging from bankruptcy);
Defs.’ Resp. to Mots. to Join Trs. at 6.) Dismissal of Ross’s and Vlahos’s claims is required, Defendants
argue, because standing is a matter that may be raised at any time during litigation.
As Plaintiffs observe, however, Defendants’ challenge is better understood as directed at
Plaintiffs’ status as the real party in interest. (Pls.’ 2d Resp. at 13, citing Tate v. Snap-On Tools
Corp., No. 90 C 4436, 1997 WL 106275, *4 (N.D. Ill. Feb. 11, 1997) (“[S]tanding turns on whether
the plaintiff can show an injury . . . traceable to the . . . defendant and likely to be redressed by the
24
relief sought [while] designation of the real party in interest . . . identif[ies] the person who
possesses the particular right sought to be enforced [and] . . . protect[s] the defendant against a
subsequent action by the party actually entitled to recover.”) (citations and internal quotation marks
omitted).) The distinction is significant because, unlike standing, challenges to whether a plaintiff
is a real party in interest are not jurisdictional. RK Co. v. See, 622 F.3d 846, 850 (7th Cir. 2010).
Although Ross and Vlahos lost their direct interests in the outcome of this lawsuit through
bankruptcy, that process did not change the fact that Defendants injured them. See Rawoof v.
Texor Petroleum Co., 521 F.3d 750, 756 (7th Cir. 2008) (distinguishing standing from real party in
interest requirement), Inghram v. Taskin, Inc., No. 07-3056, 2008 WL 295078, *2 (C.D. Ill. Jan. 31,
2008) (discussing real party in interest requirement in bankruptcy case). On February 8, 2013, the
Trustee in Ross’s bankruptcy moved for appointment of Plaintiffs’ counsel in this action as special
counsel in Ross’s bankruptcy proceeding, and Ross moved to substitute his bankruptcy Trustee
[242], the real party in interest, in this suit on February 13, 2013. That same day, Vlahos similarly
moved to join his bankruptcy Trustee in this suit [243]. Ross and Vlahos are no longer the real
parties in interest in this case and will not benefit directly, but this does not require dismissal of their
claims.13
C.
Judicial Estoppel
The doctrine of judicial estoppel bars parties in litigation from taking positions that contradict
positions they successfully took in earlier proceedings. Johnson v. ExxonMobil Corp., 426 F.3d 887,
891 (7th Cir. 2005). Judicial estoppel “protect[s] the integrity of the judicial process by prohibiting
parties from deliberately changing positions according to the exigencies of the moment.” New
13
Plaintiff Ross has argued that an order dismissing the jury’s award to him would be
void because his claim is the property of an estate over which a Chapter 7 Trustee has exclusive
authority and which is protected by an automatic stay. (Pls.’ 2d Resp. at 14.) As Ross himself
initially failed to disclose his claim to the Trustee, this argument appears disingenuous, but in light
of the disposition outlined in text, the court need not address it further.
25
Hampshire v. Maine, 532 U.S. 742, 749-50 (2001) (citations and internal quotation marks omitted).
Enforcement of the doctrine of judicial estoppel is within the court’s discretion. In re Knight-Celotex,
LLC, 695 F.3d 714, 721 (7th Cir. 2012).
Defendants invoke this doctrine, reasoning that the
Bankruptcy Plaintiffs benefitted by failing to disclose this lawsuit and should be estopped now from
recovering on the verdict. The court addresses this argument first with respect to Plaintiff Diaz, who
did initially disclose his interest in this case, and then with respect to the remaining Bankruptcy
Plaintiffs, who did not.
1.
Plaintiff Diaz
Defendants admit that Diaz disclosed his interest in this suit in his initial bankruptcy petition
on September 2, 2010, but note that he estimated the value of his interest in the case at only
$5,000 (Defs.’ 2d Reply at 10-11)—far less than the verdict for him of $25,000 in compensatory
damages and $10,000 in punitive damages. (Minute Entry 9/4/12 [189].) Defendants contend that
Diaz should be judicially estopped from recovering on this verdict because he did not attempt to
amend his bankruptcy petition to reflect the actual value of his legal claim until he was confronted
by counsel for Defendants. (Defs.’ 2d Reply at 10-11.) Defendants offer no authority for this
argument, however. Diaz’s failure to better predict the value of his claim is not grounds for judicial
estoppel, as litigants can hardly be required to accurately estimate their ultimate recovery. Cf. In re
Doctors Hosp. of Hyde Park, Inc., 474 F.3d 421, 429-30 (7th Cir. 2007) (“Litigation outcomes are
uncertain, not reducible to mathematical formulas.”). Indeed, Diaz’s modest estimate of the value
of his claim is not at all surprising to the court, in light of the fact that he (like the other Plaintiffs)
did not prove any out-of-pocket economic harm from the disbandment of SORT. And, given the
pendency of Defendants’ own post-trial motions, the court declines to adopt their theory that Diaz
could avoid judicial estoppel only by submitting amended bankruptcy filings immediately after the
verdict was returned. Defendants’ judicial estoppel objection to Diaz’s recovery is overruled.
26
2.
Plaintiffs Rueda, Lewis, Nawara, Ross, and Vlahos
Defendants contend that the remaining Bankruptcy Plaintiffs are judicially estopped from
pursuing their claims because their original bankruptcy filings made no mention of these claims at
all. (Kurtovich’s Supp. at 10, citing Cannon-Stokes v. Potter, 453 F.3d 446, 448-49 (7th Cir. 2006)
(“[A] debtor in bankruptcy who denies owning an asset . . . cannot realize on that concealed asset
after the bankruptcy ends.”); Defs. Resp. to Mots. to Join Trs. at 7-9.) Defendants acknowledge
that Vlahos reopened his bankruptcy case to submit amended schedules in August 2012 and
Rueda, Lewis, Nawara, and Ross attempted to reopen their bankruptcy cases in February 2013
in order to list their interests in this case as assets. This is not enough to defeat judicial estoppel,
however, Defendants insist, because allowing parties who have deceived the court to amend their
filings without penalty “would diminish the incentive to provide truthful disclosures.” (Cnty.’s Supp.
at 5, citing Esparza v. Costco Wholesale Corp., No. 10 CV 5406, 2011 WL 6820022, *4 (N.D. Ill.
Dec. 28, 2011).)
Defendants acknowledge, further, that only Plaintiffs Lewis and Vlahos received a discharge
in bankruptcy, but nevertheless argue that all of the remaining Bankruptcy Plaintiffs are estopped
from benefitting from the verdict in this case. Defendants urge that a debtor can be subject to
judicial estoppel if he received significant financial benefits during bankruptcy proceedings, such
as the automatic stay that holds creditors at bay. (Cnty.’s Supp. at 6, citing Williams v. Hainje,
375 F. App’x 625, 626 (7th Cir. 2010) (automatic stay and reorganization plan that temporarily
relieved plaintiff of most of his debts were benefits barring him from proceeding on a civil rights
claim that arose pre-petition); see also Carnegie v. Household Int’l, 376 F.3d 656, 660
(7th Cir. 2004) (judicial estoppel applies where party received temporary benefit of an approved
class settlement).) Kurtovich similarly argues that he was prejudiced by not being able to challenge
the credibility of Plaintiffs at trial based on the Bankruptcy Plaintiffs’ “concealment of the claims in
this case” in bankruptcy. (Kurtovich’s Reply at 10.) He speculates that the jury would have
27
awarded lesser damages had they known that Plaintiffs “placed no value on their claims.” (Id.)
Plaintiffs offer several responses to these arguments. They suggest, first, that they did not
actually fail to disclose their interests in this lawsuit during bankruptcy because in each of the
Bankruptcy Plaintiffs’ cases “the Trustee was and/or is on notice of the claim.” (Pls.’ 2d Resp.
at 16-17, citing Matthews v. Potter, 316 F. App’x 512, 522 (7th Cir. 2009).) As noted, after
Defendants raised the issue, Ross and Vlahos each filed a motion to join their bankruptcy Trustees
as the real party in interest in this case [242 and 243] on February 13, 2013. In his motion, Vlahos
claimed, without detail, that he disclosed this suit as an asset at his Creditors’ meeting. (Pls.’ Mot.
to Join Trustee of Pl. Vlahos’s Chapter 7 Estate [243], at ¶ 2.) Two weeks after filing a motion to
join his bankruptcy Trustee, Ross also declared that he “believe[s]” that he informed the Trustee
of his interest (he does not say how) at his Creditors’ meeting. (Ross Decl. [260-1] at 38.) Nawara
similarly declared on March 1, 2013, without detail, that he had disclosed his interest at his
Creditors’ meeting. (Nawara Decl. [260-1] at 34.) (Plaintiffs Lewis and Rueda do not claim to have
disclosed their interests in this case.)
Defendants are skeptical of these claims, and point out that they have not had “the
opportunity to test” the Plaintiffs’ declarations that they disclosed their interests in this case during
Creditors’ meetings. (Kurtovich’s Reply at 10.) Defendants note that Plaintiffs’ claims that the
Trustees were on notice of the Bankruptcy Plaintiffs’ interest in this suit are supported by nothing
more than the Bankruptcy Plaintiffs’ declarations. (Id.) Even if those declarations are accurate,
Defendants argue, informal verbal disclosures in Creditors’ meetings are not adequate because
bankruptcy schedules must be signed by the debtor under penalty of perjury. (Defs.’ 2d Reply
at 10.) The court agrees. The Bankruptcy Plaintiffs did not properly disclose their interests in this
case in their bankruptcy filings, and there is insufficient evidence that their interests were made
clear enough to put the Trustees on notice of their claims. The fact that some of the Plaintiffs may
have informally told their Trustees about their interests in this case does not change things.
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Plaintiffs next urge that their failure to properly list their interests in this case was
inadvertent, and that judicial estoppel is inappropriate when a party’s inconsistent positions are the
result of mistake. The Bankruptcy Plaintiffs maintain that they have worked to correct the errors
in their bankruptcy schedules, and that those errors were oversights, not deceptions. (Pls.’ 2d
Resp. at 16-17.) Plaintiffs cite Fairchild v. Touchtunes Music Corp., where the court permitted
discovery on the question of plaintiff’s intent in failing to disclose his employment discrimination
claim, observing that the judicial estoppel doctrine is aimed at “cold manipulation and not [at] an
unthinking or confused blunder.” No. 01 C 9699, 2002 WL 31833768, *2 (N.D. Ill. Dec. 12, 2002).
Defendants challenge Plaintiffs’ assertion that their failures to disclose their interests in this
case were inadvertent; in any event, Defendants argue, even an apparently innocent mistake is not
a defense to Plaintiffs’ failure to list a pending claim in bankruptcy. (Kurtovich’s Supp. at 10.)
There is case law on both sides of that argument. See Hawkins v. Securitas Sec. Svcs., No. 09
C 3633, 2011 WL 2837269, *1 (N.D. Ill. July 18, 2011) (plaintiff who received Chapter 7 discharge
after filing suit barred from pursing a fair pay claim even though she had reopened her bankruptcy
and claimed her failure to schedule the claim was an innocent mistake); Becker v. Verizon N., Inc.,
No. 06-2956, slip op., 2007 WL 1224039, *1 (7th Cir. Apr. 25, 2007) (“Becker intimates that her
failure to disclose this lawsuit in her sworn financial statement was unintentional, but her subjective
intent does not” prevent judicial estoppel.); but see Rainey v. United Parcel Serv., 466 F.
App’x 542, 545 (7th Cir. 2012) (no judicial estoppel when plaintiff re-opens bankruptcy case to
disclose inadvertently undisclosed interest); Fairchild, 2002 WL 31833768, *2 (permitting discovery
on the issue of plaintiff’s intent).) In this case, the notion that Plaintiffs’ omissions were inadvertent
or mistaken is not compelling. Plaintiffs testified that the injuries for which they seek a remedy in
this case were extensive and profound; they were actively litigating this claim at the time of their
filings; and they had sufficient motive to conceal the asset for their own gain.
Finally, Plaintiffs urge that dismissing their claims on judicial estoppel grounds would “work
29
an injustice” on Plaintiffs’ creditors by denying the creditors an asset. (Pls.’ 2d Resp. at 15, 21.)
At least some case law favors this position. See, e.g., Rainey, 466 F. App’x at 545 (vacating district
court’s judgment on the pleadings against plaintiff because plaintiff failed to disclose suit during
Chapter 13 bankruptcy when, on appeal, plaintiff had reopened his bankruptcy case to disclose the
suit) (“[Barring plaintiff’s claims would] undermine the interests of his creditors and defeat the
district court’s intent that [he] be able to pursue the discrimination claims if he reopened his
bankruptcy.”).) In Biesek v. Soo Line R. Co., the Seventh Circuit affirmed a district court’s grant
of summary judgment against a plaintiff because he had not disclosed his on-the-job injury claim
in his Chapter 7 bankruptcy schedules and the claim no longer belonged to him. The Seventh
Circuit noted, however, that judicial estoppel appears inappropriate when it would adversely affect
a plaintiff’s innocent third-party creditors. 440 F.3d 410, 413 (7th Cir. 2006) (“Judicial estoppel is
an equitable doctrine, and using it to land another blow on the victims of bankruptcy fraud is not
an equitable application.”). Plaintiffs contend that they have reopened their bankruptcy cases in
an honest attempt to help pay off their debts to their creditors. (Pls.’ 2d Resp. at 21.)14
The Seventh Circuit has held that a debtor in bankruptcy who denies owning an asset
cannot herself realize on that concealed asset after the bankruptcy ends. Cannon-Stokes,
453 F.3d at 448. In Cannon-Stokes, the plaintiff (1) filed for Chapter 7 bankruptcy; (2) denied
having any valuable legal claims even though she was pursuing an administrative claim against her
employer; (3) obtained a discharge; (4) subsequently filed a civil suit against her employer; and
(5) “never tried to make the creditors whole.” 453 F.3d at 449. Apart from belated efforts to make
their creditors whole, the Bankruptcy Plaintiffs are in the same circumstances. They similarly
14
Kurtovich responds that Plaintiffs fail to cite cases where a plaintiff attempted to
“redo” bankruptcy filings after winning a favorable jury verdict, so “the fairness arguments raised
by Plaintiffs are simply not applicable.” (Kurtovich’s Reply at 7.) The court does not agree that the
timing of the verdict here defeats the fairness concern; the Bankruptcy Plaintiffs’ efforts to “redo”
their filings after winning substantial verdicts do promote fairness to the creditors at this stage.
30
submitted statements under oath about their financial affairs that excluded information about their
interests in this suit, even though the suit was ongoing. By failing to list this suit as an asset, they
negligently or willfully deceived the bankruptcy court about their potential recovery. Attributing
responsibility for Plaintiffs’ failure to list their interests in this case to bankruptcy counsel does not
change the analysis. (Defs.’ 2d Reply at 10, citing Cannon-Stokes, 453 F.3d at 449 (“[B]ad legal
advice does not relieve the client of the consequences of her own acts.”).)15
The court concludes that because Nawara, Ross, Rueda, Vlahos, and Lewis failed to
disclose their interest in this suit during their bankruptcy proceedings, they personally may not
benefit from the verdict in this case. Their interests in this suit now belong to their bankruptcy
estates, so the most appropriate result is to permit those estates to intervene and seek recovery
here. The court therefore sustains Defendants’ judicial estoppel arguments against Plaintiffs
Rueda, Lewis, Nawara, Ross, and Vlahos as individuals, but will entertain motions during the next
30 days from any of their bankruptcy Trustees who wish to intervene and seek relief. See FED. R.
CIV. P. 17(a)(3) (allowing real parties in interest a “reasonable time” to ratify, join, or be substituted
into an action), FED. R. CIV. P. 25(c) (noting a court’s ability to move to substitute or join a
transferee with the original party). Ross’s and Vlahos’s respective motions to join their bankruptcy
Trustees as parties to this action [242, 243] are therefore granted.
CONCLUSION
Defendants’ motion [192] is granted in part and denied in part. The court overrules
Defendant Kurtovich’s qualified immunity defense and denies Defendants’ request for judgment
as a matter of law. The court denies Defendants’ motion to vacate the jury’s punitive damages
15
Kurtovich points out that Plaintiffs’ counsel in this action has also previously dealt
with this issue in another case. (Kurtovich’s Reply at 6, citing Lujano v. Town of Cicero, No. 07 C
4822, 2012 WL 4499326, *4 (N.D. Ill. Sept. 28, 2012) (“Attorney Kurtz submitted her own affidavit,
attesting that Lujano never informed her of the bankruptcy filing . . . ”).)
31
award against Kurtovich, but reduces that award to $10,000. The court denies Defendants’ motion
as to judicial estoppel against Plaintiff Samuel Diaz, but grants it as to Plaintiffs Javier Rueda,
Nelson Lewis, John Nawara, Glenn Ross, and Matt Vlahos to the extent that the court bars those
Plaintiffs from benefitting from this suit themselves. The court grants Ross’s and Vlahos’s motions
[242, 243] to join their bankruptcy Trustees and invites the bankruptcy Trustees of Rueda, Lewis,
Nawara, Ross, and Vlahos to move to intervene and seek relief within the next 30 days. Plaintiffs’
motion for clarification and objection to Defendants’ petition for appointment of additional counsel
[241] is stricken without prejudice as moot.
ENTER
Dated: July 15, 2013
_________________________________________
REBECCA R. PALLMEYER
United States District Judge
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