Brown v. Fifth Third Bank
MEMORANDUM Opinion and Order. Signed by the Honorable James F. Holderman on 12/20/12. Notice mailed by judge's staff (ntf, )
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
FIFTH THIRD BANK,
No. 12 C 2981
MEMORANDUM OPINION AND ORDER
JAMES F. HOLDERMAN, Chief Judge:
Pending before the court are plaintiff Shameka Brown’s motion to remand this case to state
court (Dkt. No. 13) and defendant Fifth Third Bank’s motion to dismiss (which was pending at the
time of removal, and can be found at Dkt. No. 1, Ex. C). To attempt to resolve several evidentiary
disputes related to the motions, the court began to hold an evidentiary hearing on December 19,
2012. In preparation for the hearing, the court ordered counsel for both sides to submit “any agreed
factual findings, a list of witnesses with a brief summary of what they will testify to, any relevant
documents, and pertinent law” by December 14, 2012. (Dkt. No. 40.) Fifth Third Bank submitted
the required materials on December 14, 2012 (Dkt. No. 41-43), and indicated that although it had
proposed agreed factual findings to Brown on December 11, 2012 (Dkt. No. 43, at 1 n.1.), Brown
had not responded. Brown did not submit any materials to the court before December 19, 2012.
Richard Zachary, counsel for Brown, appeared fifteen minutes late to the hearing on
December 19, 2012. Upon his arrival, Mr. Zachary attempted to tender to the court his exhibits and
witness list for the hearing. Because neither Fifth Third Bank nor the court had an opportunity to
review the exhibits Brown’s counsel tendered prior to the hearing, the court stated that it may be
necessary to continue the hearing. Because one of Fifth Third Bank’s witnesses had traveled from
Delaware and another was soon leaving the country for an extended period, however, the court heard
the testimony of those two witnesses before continuing the hearing for January 9, 2013, at 9:30 am.
Because of several representations by Brown’s counsel during and after the testimony of the two
witnesses on December 19, 2012, however, the court determines that the pending motions can be
resolved without further testimony, and without any further evaluation by the court of the
outstanding factual disputes. Accordingly, the court denies Brown’s motion to remand (Dkt. No. 13)
and grants Fifth Third Bank’s motion to dismiss (Dkt. No. 1, Ex. C). The evidentiary hearing set for
January 9, 2013, at 9:30 am is cancelled.
On June 29, 2011, plaintiff Shameka Brown filed a retaliatory discharge complaint in the
Circuit Court of Cook County against her former employer Fifth Third Bank, alleging that Fifth
Third Bank terminated her in violation of the Illinois Human Rights Act, 775 ILCS 5/2-102, and
state common law. (See Dkt. No. 20, Ex. A.) Brown had been an employee at the Deerfield Banking
Center Branch at 240 Skokie Blvd. in Northbrook, Illinois, which is operated by Fifth Third Bank.
(Dkt. No. 33 ¶ 1).
Fifth Third Bank asserts that Brown never properly served it with the summons and
complaint. Yet, Fifth Third Bank apparently learned of the suit from some other source and filed an
appearance in state court on February 6, 2012. (Id.) Thereafter, on February 13, 2012, Fifth Third
Bank filed a motion to dismiss the complaint. (Dkt. No. 1., Ex. C.) The motion to dismiss contended,
first, that the complaint should be dismissed for lack of diligence in service of process under Illinois
Supreme Court Rule 103(b). Second, it contended that Brown filed the wrong document when she
attempted to file the complaint in the state court record. According to Fifth Third Bank, the first page
and the prayer for relief of the document Brown filed referenced Brown’s complaint against Fifth
Third Bank, but the intervening six pages refer to an unrelated lawsuit and never mention Brown.
(Dkt. No. 1, Ex. C., at 2.) Fifth Third Bank attached a copy of that document, which the court will
refer to as the “Wrong Complaint,” to its motion. (Dkt. No. 1, Ex. C, Ex. A.)
In its response to Fifth Third Bank’s motion to dismiss, Brown disputed the factual premise
of both of Fifth Third Bank’s arguments. First, Brown attached three affidavits from its process
server, Lisa Connolly, indicating that Brown served Fifth Third Bank on September 27, 2011. (Dkt.
No. 1, Ex. E, Exs. B-D.) Connolly states that she first attempted to serve Fifth Third Bank at the
Deerfield Banking Center Branch on July 29, 2011, but was turned away by the receptionist and told
that she must serve Fifth Third Bank at its registered agent, Illinois Corporate Service Co. (“CSC”),
at 801 Adlai Stevenson Drive in Springfield, Illinois. (Dkt. No. 1, Ex. E, Ex. D.) After obtaining an
alias summons, she then left the alias summons with the receptionist at CSC on September 27, 2011.
Second, Fifth Third Bank attached a copy of another complaint which refers to Brown
throughout (and which the court will refer to as the “Correct Complaint”), and asserted that the
Correct Complaint had been served on Fifth Third Bank on September 27, 2011, and was the only
complaint in the state court record. (Dkt. No. 1, Ex. E, Ex. A.) To complicate matters further, Brown
stated that, unbeknownst to Brown’s attorneys, the envelope that was served on Fifth Third Bank
included an “unrelated bunch of pages stapled together due to the inadvertent oversight of an
unidentified employee in [their] office”—the Wrong Complaint. (Dkt. No. 1, Ex. E, at 2 n.4.)
According to Brown, Fifth Third Bank was thus served on September 27, 2011, with both the Wrong
Complaint and the Correct Complaint, but Fifth Third Bank chose to ignore the Correct Complaint
and responded by filing a motion to dismiss the Wrong Complaint.
After receiving a copy of Brown’s response on April 11, 2012, Fifth Third Bank learned
from the Correct Complaint that the amount in controversy exceeded $75,0000. (Dkt. No. 1 ¶¶ 6-7.)
Because Fifth Third Bank is an Ohio corporation and Brown is a citizen of Illinois, on April 23,
2012, Fifth Third Bank removed the case to federal court on the basis of diversity of citizenship.
(Dkt. No. 1.) While in federal court, the parties completed the briefing on Fifth Third Bank’s motion
to dismiss. (See Dkt. Nos. 8, 23, 29.) In addition, on May 23, 2012, Brown filed a motion to remand
the case to state court on the procedural ground that Fifth Third Bank removed the case outside of
the 30-day time limit allowed by 28 U.S.C. § 1446(b).
The briefing on the motion to dismiss left two key factual issues outstanding. First, Fifth
Third Bank submitted two affidavits from Andrew Gachaiya, a Customer Service Specialist at CSC,
contesting Connolly’s statement that she served a summons on Fifth Third Bank at CSC on
September 27, 2011. (Dkt No. 6, Ex. F; Dkt. No. 33, Ex. F.) According to Gachaiya, CSC has no
record of any summons served on that date directed to Fifth Third Bank or any related entity. (Dkt.
No. 33, Ex. F ¶ 7.) Gachaiya’s affidavit thus directly contradicts Connolly’s affidavit about her
efforts to serve Fifth Third Bank at CSC in Springfield.
Second, the parties continued to dispute the contents of the state court record. Following
removal, the court ordered Fifth Third Bank to file a certified copy of the state court record. (Dkt.
Nos. 11, 19.) The first document in the certified state court record that Fifth Third Bank filed is the
Correct Complaint, stamped June 29, 2011, at 4:35 p.m. (Dkt. No. 20, Ex. B.) Moreover, the Wrong
Complaint never appears as a pleading in the state court record. (Id.)1 Nonetheless, Fifth Third
Bank’s attorney persisted in her assertion by affidavit that the Wrong Complaint was in the state
court record at the time she checked it before filing an appearance in the state court case. (Dkt. No.
9, Ex. G ¶¶ 2-3.) According to her statement submitted with the certified state court record:
When Fifth Third’s counsel was obtaining the certified copies [of the state court
record], one other pleading was missing from the court file: the complaint Fifth Third
has referred to as the “Initial” Complaint [aka the Wrong Complaint] was not in the
state court file. This was the first time, in the several occasions in which Fifth Third
looked at the state court file, that the Initial Complaint was not in the file.
(Dkt. No. 20 ¶ 4.) Brown’s attorney submitted a competing affidavit indicating that the only
complaint he ever filed was the Correct Complaint, and that he checked the state court record and
confirmed that the Correct Complaint was on file sometime between February 14, 2012, and April
11, 2012. (Dkt. No. 1, Ex. E, Ex. E ¶¶ 2, 8.)
In light of those factual disputes, the court set the December 19, 2012, evidentiary hearing
to allow the parties to present evidence and argument on the questions of which complaint was in
the state court record, which complaint is currently operative, and whether the court should believe
Connolly’s assertions that she attempted to serve a summons on Fifth Third Bank at CSC on
September 27, 2011, or Gachaiya’s assertions that CSC received no summons related to this case
on that date. (See Dkt. No. 34.)
Normally, federal courts presume state court records are sufficiently reliable to be judicially
noticed. See Ennenga v. Starns 677 F.3d 766, 773-74 (7th Cir. 2012) (“Here, the court took judicial
notice of the dates on which certain actions were taken or were required to be taken in the earlier
state-court litigation—facts readily ascertainable from the public court record and not subject to
reasonable dispute.”); Henson v. CSC Credit Servs., 29 F.3d 280, 284 (7th Cir.1994) (finding public
court documents judicially noticeable). Here, however, the parties’ contradictory factual assertions
about the state court record precluded the court from taking judicial notice of its contents. (See Dkt.
No. 34, at 3.)
Fifth Third Bank’s submissions in preparation for the hearing and the statements of Brown’s
counsel at the hearing are sufficient to allow the court to resolve the outstanding motions without
further inquiry into the remaining factual disputes. The court will address each pending issue in turn.
Motion to Remand
Under federal law, a defendant in state court may remove a case to federal court only if it
files the notice of removal in federal court “within 30 days after the receipt by the defendant,
through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon
which such action or proceeding is based.” 28 U.S.C. § 1446(b). According to Brown, Fifth Third
Bank was served with the complaint on September 27, 2011, so the removal on April 23, 2012, was
outside the 30-day limit. In this court’s order of September 26, 2012, however, the court determined
that Connolly’s attempt to serve Fifth Third Bank at CSC on September 27, 2011, even accepting
that it happened, was not successful under Illinois law. (Dkt. No. 34, at 3.) The court noted that
although the proper defendant in this case is “Fifth Third Bank” (the operator of the Deerfield
Banking Center Branch (Dkt. No. 33 ¶ 1)), the summons that Connolly says she served on
September 27, 2011, is addressed to “Fifth Third Asset Management” (Dkt. No. 32, Ex. A), a wholly
owned subsidiary of Fifth Third Bank (Dkt. No. 33, Ex. B). Illinois law establishes that “[t]he mere
fact that a corporation is owned by another corporation does not render the subsidiary a proper agent
for service of process upon the parent.” Rymal v. Ulbeco, Inc., 338 N.E.2d 209, 212 (Ill. App. Ct.
1975). Instead, Illinois courts will disregard corporate formalities only “[w]here the facts indicate
that one corporation so controls the affairs of another corporation that the two entities are essentially
one.” Id. at 213. The court determined that Brown had presented no facts indicating that the court
should treat Fifth Third Bank and Fifth Third Asset Management as the same entity, and that the
summons addressed to Fifth Third Asset Management thus failed to effectuate lawful service on
Fifth Third Bank.
At this point the factual concession by Brown’s counsel, Mr. Richard Zachary, at the hearing
on December 19, 2012, becomes relevant. In response to the court’s inquiry, Mr. Zachary stated that
Fifth Third Bank has not been served since the failed attempt at service on September 27, 2011.
Moreover, as Fifth Third Bank points out, the 30-day time limit for removal cannot begin to run until
formal service of the complaint. Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344,
347-48 (1999) (“[A] named defendant’s time to remove is triggered by simultaneous service of the
summons and complaint, or receipt of the complaint, through service or otherwise, after and apart
from service of the summons, but not by mere receipt of the complaint unattended by any formal
service.” (emphasis added)). Accordingly, Fifth Third Bank’s removal of the case on April 23, 2012,
was timely.2 Brown’s motion to remand (Dkt. No. 13) is denied.
Motion to Dismiss for Failure to State a Claim
In its submissions to prepare for the hearing, Fifth Third Bank conceded that the Correct
Complaint is the currently operative pleading. (See Dkt. No. 41, at 6.) Thus, there is no further need
for the court to resolve the factual dispute about which of the complaints was in the state court
record. Fifth Third Bank’s pending motion to dismiss for failure to state a claim was based on the
premise that the Wrong Complaint was operative. Because Fifth Third Bank has presented no
The only federal circuit to address the issue has held that notice of removal may be filed
before proper service is completed. See Delgado v. Shell Oil Co., 231 F.3d 165, 170-171, 177 & n.23
(5th Cir. 2000). The court adopts the reasoning of the Fifth Circuit and holds that Fifth Third Bank’s
removal was timely even though it had not been properly served at the time of removal.
argument that the Correct Complaint fails to state a claim, its motion to dismiss Brown’s complaint
for failure to state a claim must be, and is, denied.
Motion to Dismiss for Lack of Diligence in Service of Process
The only remaining issue is Fifth Third Bank’s motion to dismiss for lack of diligence in the
service of process. Because the alleged service on Fifth Third Bank occurred before removal, the
court applies state procedural rules to determine the sufficiency of process. Romo v. Gulf Stream
Coach, Inc., 250 F.3d 1119, 1122-1123 (7th Cir. 2001) (state procedural rules apply to determine
if defendant was timely served before removal). Illinois Supreme Court Rule 103(b) provides that
(b) Dismissal for Lack of Diligence. If the plaintiff fails to exercise reasonable
diligence to obtain service on a defendant prior to the expiration of the applicable
statute of limitations, the action as to that defendant may be dismissed without
prejudice. If the failure to exercise reasonable diligence to obtain service on a
defendant occurs after the expiration of the applicable statute of limitations, the
dismissal shall be with prejudice as to that defendant only and shall not bar any claim
against any other party based on vicarious liability for that dismissed defendant’s
conduct. The dismissal may be made on the application of any party or on the court’s
own motion. In considering the exercise of reasonable diligence, the court shall
review the totality of the circumstances, including both lack of reasonable diligence
in any previous case voluntarily dismissed or dismissed for want of prosecution, and
the exercise of reasonable diligence in obtaining service in any case refiled under
section 13-217 of the Code of Civil Procedure.
Illinois courts consider a variety of factors to determine if a plaintiff has employed “reasonable
diligence to obtain service”:
Each case is decided on its own facts and circumstances, and while no absolute
standard exists, certain non-exclusive factors are to be considered, such as (1) the
length of time used to obtain service of process, (2) the activities of the plaintiff
during that time period, (3) the plaintiff’s knowledge of the defendant’s location; (4)
the ease with which the defendant’s whereabouts could have been ascertained, (5)
actual knowledge on the part of the defendant concerning the pendency of the action,
(6) any special circumstances affecting the plaintiff’s efforts at service, and (7) actual
service on the defendant.
Kole v. Brubaker, 759 N.E.2d 129, 134 (Ill. App. Ct. 2001). When setting the evidentiary hearing,
the court indicated that even though Connolly’s attempt to serve Fifth Third Bank at CSC in
Springfield failed (even accepting that it occurred) because the summons was addressed to the
wrong party (and CSC was, in any case, not Fifth Third Bank’s registered agent), the court would
consider as a factor whether Fifth Third Bank’s receptionist misled Connolly by instructing her that
Fifth Third Bank could be served at CSC. (Dkt. No. 34, at 3.) The court set the evidentiary hearing
to determine the factual question of whether Connolly actually attempted service at the Deerfield
Banking Center Branch and at CSC, as she asserted.
Once again, however, the factual concession by Mr. Zachary at the December 19, 2012,
hearing makes further inquiry unnecessary. As explained previously, the court’s order of September
26, 2012, held that Connolly’s attempt to serve Fifth Third Bank at CSC on September 27, 2011,
was legally insufficient to serve Fifth Third Bank. (Dkt. No. 34, at 3.) Brown has made no further
efforts in the almost three months since that order to effectuate proper service on Fifth Third Bank.
In addition, Mr. Zachary provided no explanation for the failure, other than to indicate that he was
not aware that the court’s order had decided that the September 27, 2011, service was improper. The
court order had been docketed in the public court file upon issuance (Dkt. No. 34) and plainly stated
that “service on Fifth Third Bank’s subsidiary was insufficient to effectuate service on Fifth Third
Bank” and that “Fifth Third Bank thus did not receive the Correct Complaint on September 27,
2011.” (Dkt. No. 34, at 3.) The failure of Mr. Zachary to check the court docket at reasonable
intervals to stay abreast of the court’s orders is an extreme lack of diligence.
Moreover, even if somehow Mr. Zachary could be excused for not being aware of the court’s
holding, he has known for months that Fifth Third Bank contested the sufficiency of process and that
the court could decide that service was improper. Fifth Third Bank filed the first Gachaiya affidavit
with its reply in support of its motion to dismiss on May 10, 2012, providing ample notice to Mr.
Zachary of the dispute about the sufficiency of service on September 27, 2011. Any reasonably
diligent attorney would have corrected the potential error and caused Fifth Third Bank to be served
at that point, but Mr. Zachary did nothing at the time and has done nothing in the intervening
months. From those facts alone, regardless of the resolution of the remaining factual disputes, the
court determines that Brown and her attorney, Mr. Zachary, have not been reasonably diligent in
their efforts to obtain service.
But there is more. Fifth Third Bank’s attorney stated at the hearing that Fifth Third Bank can
be served at any of its banking locations in Illinois, or at its corporate offices at 222 S. Riverside
Plaza in Chicago. Moreover, Brown had knowledge of that fact because she served the Charge of
Discrimination underlying this case on Fifth Third Bank at 222 S. Riverside Plaza. (Dkt. No. 43, at
7; Dkt. No. 43, Ex. 15.) It thus should have been easy to determine Fifth Third Bank’s location for
the purpose of service. Brown’s failure to do so further bolsters the finding of a lack of diligence.
And finally, the behavior of Brown’s counsel, Mr. Zachary, at the hearing further supports
the court’s finding of a lack of reasonable diligence to obtain service. First, Mr. Zachary failed to
file a witness list, an exhibit list, and pertinent law with the court by December 14, 2012, as the court
had ordered. (Dkt. No. 40.) That failure in itself would justify a decision to bar Brown from
presenting any witnesses at the hearing. See Fed. R. Civ. P. 37(c)(1). After Mr. Zachary appeared
fifteen minutes late for the hearing, he produced for the first time, with no advance notice to Fifth
Third Bank, what he asserted was the original summons in this case that he had just recently “found”
in a file in his office. Mr. Zachary then attempted to tender exhibits to the court and to Fifth Third
Bank’s counsel, leaving little to no time for review of the exhibits. Then, after examination of Fifth
Third Bank’s witnesses began, Mr. Zachary inexplicably left the well of the courtroom and seated
himself in the public area of the courtroom. Despite the court’s admonition to him to remain in the
well of the courtroom, Mr. Zachary returned to the public area several more times during the
hearing. As the hearing proceeded, moreover, it became apparent that Mr. Zachary was not prepared
to address the disputed issues. Mr. Zachary’s lack of preparedness for the hearing, which was
scheduled to address the propriety and diligence of his attempts to serve process in this case, also
supports the finding that he has not been diligent in his attempts to obtain service.
The court is thus convinced that a further evidentiary hearing is unnecessary and would
merely waste the court’s and the parties’ resources. The court has seen more than enough to
conclude that Brown, through her counsel, Mr. Zachary, has not been diligent in seeking to
effectuate proper service of process on Fifth Third Bank in this case.
For the reasons explained above, Brown’s motion to remand (Dkt. No. 13) is denied, and
Fifth Third Bank’s motion to dismiss Brown’s complaint for lack of diligence in the service of
process (Dkt. No. 1, Ex. C) is granted. Because the statute of limitations has expired, the dismissal
of Brown’s complaint is a dismissal with prejudice. Ill. Sup. Ct. R. 103(b). The evidentiary hearing
the court set orally for January 9, 2013, at 9:30 am is cancelled. Fifth Third Bank’s “Motion to Bar”
(Dkt. No. 44) and its “Motion to Excuse” (Dkt. No. 47) are moot. This civil case is terminated.
JAMES F. HOLDERMAN
Chief Judge, United States District Court
Date: December 20, 2012
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