Linda Construction Inc., et al v. City of Chicago et al

Filing 64

MEMORANDUM Opinion and Order Signed by the Honorable Harry D. Leinenweber on 3/15/2016:; Civil case terminated. Mailed notice(wp, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

LINDA CONSTRUCTION INC.,
LINDA McGEE and JESSE McGEE,
Plaintiffs,

Case No. 15 C 8714

v.

Judge Harry D. Leinenweber

CITY OF CHICAGO, et al.,
Defendants.

MEMORANDUM OPINION AND ORDER
Before

the

Court

are

three

Motions

to

Dismiss

filed

by

Defendants Seng LLC (“Seng”) and John Doe (collectively the “the
Seng Defendants”); Defendants City of Chicago (“the City”) and
Jamie L. Rhee (“CPO Rhee”) (collectively “the City Defendants”);
and Defendants Republic Services Inc. (“Republic”), Allied Waste
Transportation Inc. (“Allied”), Mark Riley, and Brian Holcomb
(collectively “the Republic Defendants”) [ECF Nos. 28, 32, 33].
In

addition,

Preliminary

the

Court

Injunction,

considers

Motion

for

Plaintiffs’

for

Hearing,

Evidentiary

Motion

and

Motion for Leave to Present New Evidence [ECF Nos. 17, 56, 60],
as

well

as

the

Seng

Defendants’

Motion

for

Sanctions

[ECF

No. 42].
For the reasons stated herein, the Motions to Dismiss are
granted.
Evidentiary

The

Motion

Hearing,

for
and

Preliminary

Injunction,

Motion

Leave

for

to

Motion

for

Present

New

Evidence are, in turn, denied as moot.

The Motion for Sanctions

is also denied.
I.

BACKGROUND

The following facts are contained in Plaintiffs’ Complaint
and documents attached to, referenced in, and critical to, the
Complaint.

Geinosky v. City of Chicago, 675 F.3d 743, 745 n.1

(7th Cir. 2012).

Because Plaintiffs chose not to provide the

Court with a statement of the relevant facts in their responsive
briefing, the following is the Court’s best attempt to cobble
together from the disjointed allegations in the Complaint the
facts pertaining to the Motions presently before the Court.
On November 9, 2009, the City, through its Department of
Procurement Services (“DPS”), advertised for bids on a contract
for “Operation and Maintenance of City-Owned Materials Recycling
and

Recovery

Facilities”

(the

“MRRF

contract”).

In

its

solicitation for bids for the MRFF contract the City specified a
minimum

goal

participation

of

Business

Enterprises

(“MBEs”)

Business

Enterprises

16.9
and

(“WBEs”).

The

percent
4.5

Minority-Owned

percent

winning

Women-Owned

contractor

was

required to list the utilization percentages of MBEs and WBEs in
its bid proposal to the City.
On or about December 11, 2009, Defendant Allied submitted
its

sealed

bid

to

provide

handling,

treatment,

storage,

transportation, hauling, and disposal of Municipal Solid Waste

- 2 -

for

a

thirty-six

month

period

from

March

February 14, 2013 (“Contract No. 21472”).
2010,

the

City

accepted

No. 21472 to Allied.

Allied’s

bid

9,

2010

through

In the spring of

and

awarded

Contract

(Compl. Ex. A; City Def.’s Mem. Ex. A, ECF

No. 32-1).
Plaintiffs allege that Contract No. 21472 between Allied
and the City “required [Allied] to enter into a ‘joint venture’
with

a

minority

owned

contractor”;

that

Plaintiff

Linda

Construction Inc. (“LCI”) — an African-American owned business —
was that contractor; that the contract gave LCI a three-year
probationary

period

to

prove

it

was

capable

of

doing

the

required work; and that if LCI succeeded during the probationary
period it would be eligible to bid for the City contract as
prime

contractor.

After

thoroughly

examining

Contract

No. 21472, the Court is unable to find any of these allegations
to be true.
and

the

In ruling on a 12(b)(6) motion, “[w]here an exhibit

complaint

conflict,

the

exhibit

typically

controls.”

Forrest v. Universal Sav. Bank, F.A., 507 F.3d 540, 542 (7th
Cir.

2007).

Therefore,

the

Court

“is

not

bound

by”

LCI’s

characterization of the exhibit and “may independently examine
and form its own opinions about the document.”
From

the

terms

of

Contract

No.

21472,

Id.
it

appears

that

Allied identified LCI as one of several MBE entities that it
would serve as a subcontractor if Allied won the bid with the

- 3 -

City.

LCI was identified as a certified MBE subcontractor that

would provide Hauling Services to Allied, as prime contractor,
and be rewarded equivalent to 3 percent of all net payments made
to Allied under the contract.

Moreover, LCI was required to

“enter into a formal written agreement for the above work with
[Allied]

as

Prime

Contractor,

conditioned

upon

[Allied’s]

execution of a written contract with the City of Chicago. . . .”
On March 19, 2010, after Allied was awarded Contract No. 21472,
LCI indeed entered into a formal written subcontractor agreement
with

Allied.

But

that

contract

is

not

attached

to

the

Complaint, nor do Plaintiffs purport to base their claims on the
terms of that agreement.
Instead,
No. 21472,

Plaintiffs

the

contract

center
between

their
Allied

claims
and

on

the

Contract

City.

They

allege that the City and Allied were not happy that LCI was
awarded

the

MBE

contract,

and

therefore

set

about

doing

“whatever was possible to cause [LCI] to fail . . . so that
[LCI]

would

contracts.”

not

become

eligible

(Compl. ¶ 5).

to

bid

for

any

[future]

Plaintiffs allege that Allied and

its parent company, Republic, with the help and participation of
the

City,

recruited

other

named

Defendants

to

treat

LCI

“differently than they treated white owned contractors” and “to
ensure that LCI failed . . . by obstructing LCI’s operations”,
(id. at ¶ 6), and rendering it insolvent.

- 4 -

(Id. at ¶ 50).

In

support of this accusation, Plaintiffs point to the following
occurrences:
1.
Republic and Allied — who operated the transfer
station —
refused
to
load
LCI’s
trucks
and
intentionally delayed the loading process to ensure
LCI was unable to complete the required number of
daily loads. (Id. at ¶¶ 35, 42).
2.
Republic instructed Local Union 731 not to allow
LCI employees to sign membership applications, and
then Allied attempted to terminate its agreement with
LCI because LCI employees were not members of the
Union. (Id. at ¶ 35).
3.
Even after resolving this dispute with the Union,
LCI was prohibited from bringing any disciplinary
actions
against
its
employees
for
any
reason.
Specifically, LCI contends that the Union leaders
encouraged LCI employees to misbehave and obstruct
LCI’s operations, and then consistently sided with
LCI’s employees despite their obvious misconduct. (Id.
at ¶¶ 36, 37).
LCI filed a grievance with the Union
to no avail. (Id. at ¶ 36).
4. The Union filed frivolous lawsuits against LCI for
unpaid dues, and then reportedly threatened LCI’s
attorneys retained to defend against the suits. (Id.
at ¶ 39).
5.
CPO
Rhee
paid
Republic
and
Allied
without
obtaining signed approvals from LCI, in violation of
the City’s express policy. (Id. at ¶ 41).
6.
Brian Holcomb, of Allied, promised to pay LCI
$800,000 towards a $1.6 million invoice, but failed to
do so. (Id. at ¶ 43).
Later, Holcomb told LCI that
Allied could only pay $400,000 towards the invoice.
(Id.). But to date, no funds have been paid. (Id.).
7.
LCI brought the aforementioned concerns to the
attention of CPO Rhee (in fact, they made at least 24
complaints in 16 months), but she did nothing to
remedy the situation. (Id. at ¶¶ 42, 44, 47).

- 5 -

8.
On
March
29,
2012,
Allied
attempted
unsuccessfully to terminate LCI by claiming lack of
performance. (Id. at ¶ 45).
9.
Allied allowed TC Transportation, a white-owned
company, to utilize sites that were contractually
exclusive to LCI. (Id. at ¶ 46).
10. In December 2013, Republic refused to pay LCI on
a $1.4 million invoice because it claimed LCI had
failed to meet its daily load requirement (it is
unclear from the pleadings whether this invoice is
different than the $1.6 million invoice discussed
previously). (Id. at ¶ 48).
11. Seng, a creditor of LCI, claimed it was owed
money and seized LCI’s trucks.
LCI contends that it
had already paid Seng and therefore Seng’s claim
against it was false and the seizure of the trucks was
improper. (Id. at ¶ 50).
12. In March 2014, Allied accused LCI of violating
the terms of its agreement by allowing garbage to
build up at the transfer station, but withdrew the
allegation once it was disclosed that the garbage
build-up was due to Allied shutting down the transfer
station for a day and a half. (Id. at ¶ 52).
Ultimately,

on

April

7,

2015,

Allied

terminated

its

agreement with LCI claiming that LCI was insolvent and unable to
perform

at

the

required

level.

(Id.

at

¶

53).

Plaintiffs

contest these allegations and contend that their circumstances
were the product of Defendants’ actions.

As a result of the

foregoing conduct, LCI was unable to bid on the November City
contracts. (Id. at ¶ 54).
Plaintiffs

filed

the

instant

against the various Defendants:

suit

raising

five

counts

violation of 42 U.S.C. § 1981

(Count I); violation of 42 U.S.C. § 2000e (Count II); violation

- 6 -

of

42

U.S.C.

§

1983

(Count

III);

violation

of

42

U.S.C.

§ 1985(3) (Count IV); and tortious interference with contract
(Count VI).
Allied

Plaintiffs also allege that the City, Republic and

committed

breach

of

contract

(Count

V).

The

Seng

Defendants, the City Defendants, and the Republic Defendants now
bring three separate Motions to Dismiss.

The City and Republic

Defendants both argue that Plaintiffs Linda and Jesse McGee lack
standing to maintain any of the alleged causes of action.
Court will address this argument first.

The

The Court will then

discuss the viability of each of Plaintiffs’ claims in light of
the numerous interrelated and independent reasons for dismissal
cited by Defendants.
II.

LEGAL STANDARD

A motion to dismiss for failure to state a claim under
Rule 12(b)(6) challenges the legal sufficiency of a complaint.
Hallinan v. Fraternal Order of Chi. Lodge No. 7, 570 F.3d 811,
820 (7th Cir. 2009).

A complaint must contain “enough facts to

state a claim to relief that is plausible on its face.”

Bell

Atlantic

When

Corp.

considering

a

v.
Rule

Twombly,
12(b)(6)

550

U.S.

motion

544,

to

570

dismiss,

(2007).
a

court

must

accept the plaintiff’s allegations as true, and view them in the
light most favorable to the plaintiff.
821 F.2d 408, 410 (7th Cir. 1987).

Meriwether v. Faulkner,

A court need not accept as

true “legal conclusions, or threadbare recitals of the elements

- 7 -

of a cause of action, supported by mere conclusory statements.”
Brooks

v.

Ashcroft

Ross,
v.

578

F.3d

574,

556

U.S.

Iqbal,

581

(7th

662,

Cir.

678

2009)

(2009))

(quoting
(internal

quotations and alterations omitted).
III.

ANALYSIS

A. Standing as to Linda and Jesse McGee
The
Linda

and

City

and

Jesse

Republic

McGee

lack

Defendants
standing

argue

to

that

maintain

Plaintiffs
any

of

the

alleged causes of action because they did not suffer any injury
separate

and

apart

from

those

allegedly

suffered

by

LCI.

Although the Complaint alleges that Linda McGee is the president
and majority shareholder of LCI and that Jesse McGee is the Vice
President of the company, well-established precedent holds that
“shareholders

do

not

have

standing

to

sue

for

harms

to

the

corporation, or even for the derivative of harm to themselves
that might arise from a tort or other wrong to the corporation.”
Hammes v. AAMCO Trans., Inc., 33 F.3d 774, 777 (7th Cir. 1994).
For Linda and Jesse McGee to have standing, they must be
able to allege an injury that affects their own legal rights,
not those of their company, LCI.

J.F. Shea Co. v. City of

Chicago, 992 F.2d 745, 749 (7th Cir. 1993); see also, Southwest
Suburban Bd of Realtors, Inc. v. Beverly Area Planning Assoc.,
830

F.2d

officers,

1374

(7th

stockholders,

Cir.
and

1987)

(corporation’s

creditors

- 8 -

had

no

employees,

injury

distinct

from

corporation

and

lacked

standing

to

maintain

antitrust

suit); Pitchford v. Pepi, Inc., 531 F.2d 92, 97 (3d Cir. 1975)
(corporate

president

lacked

standing

to

sue

either

in

his

capacity as a stockholder or as an officer because injuries were
derivative of the company’s injuries), cert. denied, 426 U.S.
935 (1976), 440 U.S. 981 (1979).
Linda

nor

Jesse

was

party

to

They fail to do so.
either

contract

Neither

cited

in

the

complaint, and the alleged discriminatory behavior upon which
Plaintiffs base their claims was directed entirely at LCI.

The

Complaint contains no allegation of conduct that was personally
directed at, or resulted in distinct personal injury to, Linda
and Jesse McGee.

Without such allegations, Plaintiffs Linda and

Jesse McGee lack standing and the Court dismisses all claims
brought by them.

Plaintiffs are granted fourteen (14) days from

the date of this Opinion to file an Amended Complaint.
B.

Count I - Discrimination on the Basis of Race,
Violation of 42 U.S.C. § 1981

Under section 1981, “[a]ll persons within the jurisdiction
of the United States shall have the same right in every State
and territory to make and enforce contracts . . . and to the
full

and

security

equal
of

persons

citizens. . . .”
the

“making,

contracts,

benefit

and

of

and

all

laws

property

and
as

proceedings

is

enjoyed

for
by

the

white

The term “make and enforce contracts” includes

performance,
the

modification,

enjoyment

of

- 9 -

all

and

termination

benefits,

of

privileges,

terms, and conditions of the contractual relationship.”
§ 1981(b).

Id. at

To state a claim under 42 U.S.C. § 1981, Plaintiffs

must allege that:

(1) they are members of a racial or ethnic

minority; (2) Defendants intended to discriminate against them
on the basis of race or ethnicity; and (3) the discrimination
concerned the making and enforcing of a contract.

Pourghoraishi

v. Flying J, Inc., 449 F.3d 751, 756 (7th Cir. 2006).

Thus, a

successful section 1981 claim depends upon the existence of a
contract.
1025,

Gonzalez v. Ingersoll Milling Mach. Co., 133 F.3d

1034

(7th

Cir.

1998);

Stone

v.

Am.

Fed’n

of

Gov’t

Employees, 135 F.Supp.2d 873, 875 (N.D. Ill. 2001).
Plaintiffs allege that Defendants treated LCI differently
to ensure that they did not qualify to bid for City contracts,
and that this was done because of Plaintiffs’ race.
¶ 61).

(Compl.

Plaintiffs do not base their section 1981 claim on any

existing

contract

to

which

they

were

a

party,

instead,

they

claim that Defendants interfered with “the making” of a contract
between LCI and the City.

But a claim for interference with the

right to make and enforce a contract “must allege the actual
loss of a contract interest, not merely the possible loss of
future contract opportunities.”
F.3d

411,

414

(7th

Cir.

Morris v. Office Max, Inc., 89

1996)

(allegation

that

defendant

interfered with “prospective” contractual rights is “speculative
and insufficient to state a claim under § 1981”).

- 10 -

Plaintiffs

have pleaded themselves out of court by admitting that they did
not

bid

Because

on

the

“November

Plaintiffs

did

City

not

contracts.”

attempt

to

(Compl.

obtain

the

¶ 54).

November

contracts by placing bids, they never sought to enter into a
contractual relationship with the City.
contractual
Plaintiffs

interest

in
only

suffered

which
the

As such, there was no

Defendants
possible

could

loss

interfere.

of

a

future

plaintiff

cannot

contractual opportunity, which is insufficient.
Moreover,
maintain

a

it

is

section

well

1981

settled

claim

terminating the transaction.

that

when

a

she

is

responsible

for

Bagley v. Ameritech Corp., 220

F.3d 518, 521 (7th Cir. 2000); Morris v. Office Max, Inc., 89
F.3d 411, 414 (7th Cir. 1996); Hart v. Wal-Mart Stores, Inc.,
No. 09-CV-2125, 2010 WL 2663081, at *6 (C.D. Ill. July 1, 2010).
Plaintiffs terminated the transaction with the City by failing
to

bid

on

the

November

contracts.

In

doing

so,

they

extinguished any possible claim of racial discrimination under
section 1981.
as

a

matter

Therefore, Plaintiffs’ section 1981 claim fails
of

law

and

the

Court

dismisses

Count

I

with

prejudice as to all Defendants.
C.

Count II - Discrimination on the Basis of Race,
Violation of 42 U.S.C. § 2000e (“Title VII”)

Title VII prohibits discrimination in employment. 42 U.S.C.
§ 2000e-2. Plaintiffs’ Title VII claim fails because they have
not

set

forth

any

facts

alleging
- 11 -

that

they

applied

for

employment with, or were ever employed by, any of the named
Defendants.

See, e.g., Alam v. Miller Brewing Co., 709 F.3d

662, 667 (7th Cir. 2013) (affirming dismissal of Title VII claim
where

plaintiff

employment

failed

to

relationship

plead

facts

existed

establishing

between

that

plaintiff

an
and

defendant); Mays v. BNSF Ry. Co., 974 F.Supp.2d 1166, 1177 (N.D.
Ill.

2013)

(dismissing

plaintiff’s

Title

VII

claim

where

plaintiff admitted that he “was never employed by [defendant]”).
The

closest

Allied.

Plaintiffs

But

that

come

is

in

relationship

their

is

relationship,

relationship

best

is

not

as

an

independent

contractor

Title VII.

Knight v. United Farm Bureau Mut. Ins. Co., 950 F.2d

377, 380 (7th Cir. 1991).

which

described

with

covered

by

Because Plaintiffs cannot cure this

defect by amending their pleadings, the Court dismisses Count II
with prejudice as to all Defendants.
D.

To

state

Count III - Violation of the Fourteenth
Amendment, 42 U.S.C. § 1983
a

cause

of

action

under

42

U.S.C.

§

1983,

a

plaintiff must allege that “some person has deprived him of a
federal right” and “that the person who has deprived him of the
right acted under color of state . . . law.”

Gomez v. Toledo,

446 U.S. 635, 640 (1980).

Plaintiffs allege Defendants deprived

them

under

of

equal

Fourteenth
accrues

protection

Amendment.

whenever

a

An

state

the

equal

in

protection

“den[ies]
- 12 -

law

to

any

violation
cause
person

of

of

the

action

within

its

jurisdiction the equal protection of the laws.”
Amend. XIV, § 1.

U.S. Const.

To state an equal protection claim, a section

1983 plaintiff must allege that a state actor or a person acting
under the color of state law purposefully discriminated against
him

because

of

his

identification

with

a

particular

group.

Sherwin Manor Nursing Ctr., Inc. v. McAuliffe, 37 F.3d 1216,
1220 (7th Cir. 1994).
Because the viability of a section 1983 equal protection
claim depends upon the defendant’s classification as a state
actor or a person acting under state law, the Court will discuss
the

liability

of

the

City

Defendants

before

turning

to

the

claims against the Republic Defendants and the Seng Defendants.
1.
A
U.S.C.

local

The City Defendants

governmental

§ 1983.

But

unit

respondeat

is

subject

superior

impose Section 1983 liability on the City.

to

will

suit
not

under

42

suffice

to

Monell v. New York

City Dep’t of Soc. Servs., 436 U.S. 658, 690–91 (1978); Moore v.
Bd. of Educ. of City of Chgo, 300 F.Supp.2d 641, 645 (N.D. Ill.
2004).

Instead, for liability to follow, a City policy must be

the source of the discrimination.

Monell, 436 U.S. at 694;

Small v. Chao, 398 F.3d 894, 898 (7th Cir. 2005).
state

a

claim

against

the

City

allege the existence of either:
when

enforced,

causes

a

Defendants,

Plaintiffs

must

(1) an express policy that,

constitutional

- 13 -

Thus, to

deprivation;

(2)

a

widespread practice that, although not authorized by written law
or express municipal policy, is so permanent and well settled as
to constitute a custom or usage with the force of law; or (3) an
allegation that the constitutional injury was caused by a person
with final policymaking authority.

Moore, 300 F.Supp.2d at 645;

see also, Kentucky v. Graham, 473 U.S. 159, 165 (1985) (the
entity’s

“policy

or

custom”

must

have

played

a

part

in

the

violation of federal law).
Plaintiffs have not alleged that their civil rights were
violated by an express policy or that CPO Rhee was a final
policymaker

for

purposes

of

imposing

liability

on

the

City.

Instead, Plaintiffs essentially allege that the City acquiesced
in, or ratified, the misbehavior of the other Defendants and CPO
Rhee.

But

“widespread

such

allegations

practice”

that,

do

not

though

rise

not

to

the

level

officially

of

a

authorized,

“is so permanent and well settled as to constitute a custom or
usage with the force of law.”

Moore, 300 F.Supp.2d at 645.

Plaintiffs’ allegation that the City of Chicago has never
contracted with a minority-owned business to haul garbage does
not cure this deficiency.

This statistic could be due to many

causes — most of which are completely innocent.
alleged
improper

with
City

any

particularity

policy;

indeed

how

the

this

City’s

fact

Nowhere is it
reflects

express

policy

an
on

contracts not only prohibits discrimination against minorities,

- 14 -

but

actually

requires

the

City

contracts to MBEs and WBEs.

to

have

a

goal

of

granting

Therefore, Plaintiffs’ Section 1983

claim as to the City is dismissed with leave to amend within
fourteen (14) days of the date of this Opinion.
In their claim against CPO Rhee in her individual capacity,
Plaintiffs seek to impose personal liability upon CPO Rhee as a
government official for actions she took under color of state
law.
that

Graham, 473 U.S. at 165.
CPO

Rhee,

deprivation

of

acting
a

under

federal

To do so, they need only allege
color

right

of

because

state
of

law,
their

caused
race.

the
The

allegations in the complaint concerning CPO Rhee are that she
“participated in disparate treatment,” (Compl. ¶ 34); that she
“enabled” and “permitted Republic and Allied to obstruct LCI,”
(id. at ¶ 41); that LCI complained to CPO Rhee and she “ignored
all the complaints,” (id.); and that CPO Rhee approved payments
to Allied without obtaining signed approvals from LCI, (id.).
It is without dispute that, in taking the complained-of actions,
CPO

Rhee

was

acting

under

the

color

of

state

law.

But

Plaintiffs’ allegations as to CPO Rhee’s discriminatory motive
are general and conclusory and do not raise a plausible claim of
intentional discrimination on the basis of race.

Therefore, the

Court dismisses Plaintiffs’ Section 1983 claim against CPO Rhee
with leave to amend within fourteen (14) days.

- 15 -

2.
When

a

The Republic Defendants and Seng Defendants
plaintiff

defendant

who

is

plaintiff

must

not

show

color of state law.

brings
a

a

Section

government

that

the

1983

official

private

claim
or

entity

against

employee,

acted

under

a

the
the

Rodriguez v. Plymouth Ambulance Serv., 577

F.3d 816, 822 (7th Cir. 2009).

This requires that a court find

such

the

a

“‘close

nexus

between

State

and

the

challenged

action’ that the challenged action ‘may be fairly treated as
that

of

the

State

itself.’”

Id.

at

823

(quoting

Metro. Edison Co., 419 U.S. 345, 351 (1974)).
not

even

actions

attempted
of

the

to

plead

Republic

and

such

a

Seng

Defendants

Jackson

v.

Plaintiffs have

connection

between

and

the

the

City.

Therefore, Plaintiffs’ Section 1983 claim as to the Republic and
Seng Defendants is dismissed with leave to amend within fourteen
(14) days of the date of this Opinion.
E. Count IV - Conspiracy between Private Actors and
Government Officials, Violation of 42 U.S.C. § 1985(3)
A civil conspiracy under section 1985 is “a combination of
two or more persons acting in concert to commit an unlawful act,
or

to

commit

a

lawful

act

by

unlawful

means,

the

principal

element of which is an agreement between the parties to inflict
a wrong against or injury upon another, and an overt act that
results in damage.”

Lenard v. Argento, 699 F.2d 874, 882 (7th

Cir. 1983); Copeland v. Nw. Mem’l Hosp., 964 F.Supp. 1225, 1234
(N.D. Ill. 1997).

Thus, to establish a prima facie case of
- 16 -

civil conspiracy under Section 1985, a plaintiff must show an
express or implied agreement among the defendants to deprive the
plaintiff of his constitutional rights, and a deprivation of
those rights in the form of an overt act in furtherance of the
agreement.

Scherer v. Balkema, 840 F.2d 437, 441 (7th Cir.

1988).
It is not enough for a Section 1985 plaintiff to plead mere
conclusory allegations of a conspiracy.

Rather, the plaintiff

must plead specific material facts that show the existence of a
conspiracy.
257,

262

See, Winterland Concessions Co. v. Trela, 735 F.2d
(7th

Cir.

1984)

(“[c]onclusory

conspiracy must be dismissed”).

pleadings

of

a

To succeed, a plaintiff must

allege a “single plan, the essential nature and scope of which
is known to each person who is to be held responsible for its
consequences.”

Hoffman–LaRoche,

872, 875 (7th Cir. 1971).

Inc.

v.

Greenberg,

447

F.2d

Moreover, the alleged conspirators

must have intended to discriminate against the plaintiff and
deprive

him

of

equal

protection

immunities because of his race.

or

equal

privileges

and

Griffin v. Breckinridge, 403

U.S. 88, 102-03 (1983); see also, Jafree v. Barber, 689 F.2d 640
at 643 (“To sufficiently state a cause of action [under Section
1985] the plaintiff must allege some facts that demonstrate that
his race was the reason for the defendant’s [action].” (emphasis
added)).

This

type

of

allegation

- 17 -

also

must

be

supported

by

material facts, not conclusory statements.

Jafree, 689 F.2d at

644.
Plaintiffs have not alleged any facts indicating that the
City or its agent, CPO Rhee, entered into an agreement with any
of the other Defendants with the goal of depriving Plaintiffs of
their constitutional rights because of their race.

Plaintiffs’

contention that a conspiracy existed is a legal conclusion that
the Court need not accept as true, Brooks, 578 F.3d at 581, and
Plaintiffs offer only conclusory allegations in support of this
contention.
intended

Plaintiffs

to

“ensure

allege

that

LCI

repeatedly

failed

that

during

its

Defendants
probationary

period,” and would do “whatever was possible to cause [LCI] to
fail.”
any

These allegations simply are insufficient to show that

meeting

of

the

minds

occurred

between

the

City

and

the

various Defendants to deprive Plaintiffs of their constitutional
rights.
Furthermore,
indicate

that

conspiracy

Plaintiffs
racial

against

have

animus

LCI.

failed

underlay

Although

Linda

to

allege

facts

Defendants’
and

Jesse

to

alleged

McGee

are

African American and LCI is an African American-owned business,
Plaintiffs make no further allegations to demonstrate that the
alleged

actions

race.

Plaintiffs

Plaintiffs

Linda

of

the

various

simply
and

tack

Jesse

Defendants
on

McGee’s

the

- 18 -

were

phrases

race”

or

motivated

by

“because

of

“because

of

[Plaintffs’] race” to each of their contentions in Count IV.
Plaintiffs’ allegations in the body of the Complaint that they
were

“treated

differently

than

white

owned

contractors,”

and

that Defendants “were not happy about having [a] black-owned
contractor com[e] in and tak[e] their contract,” are conclusory
at best.

Plaintiffs fail to allege facts showing any kind of

racial animus on the part of the City or the other Defendants.
Finally, the Section 1985 claim against the City, like that
under Section 1983, must be dismissed because Plaintiffs cannot
hold

the

City

liable

for

constitutional

injury

under

Section 1985 unless an official custom, policy, or practice has
caused

the

deprivation.

Monell,

436

U.S.

at

694.

The

allegations in the Complaint show that Plaintiffs are attempting
to impose liability on the City not for its own policies, or for
the

acts

of

its

policymakers,

but

rather

conspiratorial acts of its agent, CPO Rhee.
simply

will

not

support

holding

the

for

the

alleged

Such allegations

City

liable

under

Section 1985(3).
Because Plaintiffs have not alleged the essential elements
of a Section 1985(3) claim, Count IV is dismissed as to all
Defendants.

However, because it is conceivable that Plaintiffs

can amend the Complaint to state a successful Section 1985(3)
claim, the dismissal is without prejudice.

Plaintiffs may amend

within fourteen (14) days of the date of this Opinion.

- 19 -

F.

Count V - Breach of Contract

Plaintiffs make a claim for breach of contract as to the
City, Republic and Allied.

Under Illinois law, only a party to

the contract, one in privity with a party to the contract, or a
third-party beneficiary of the contract has standing to sue on a
contract.

Haake v. Bd. of Educ. for Twp. High Sch. Glenbard

Dist. 87, 925 N.E.2d 297, 306 (Ill. App. Ct. 2010).

Plaintiffs

are not a party to Contract No. 21472, which is between Allied
and the City.

Nor have Plaintiffs alleged (nor could they in

good faith) that they are third-party beneficiaries to Contract
No. 21472.

See, Cronimet Holdings, Inc. v. Keywell Metals, LLC,

73 F.Supp.3d 907, 917 (N.D. Ill. 2014) (stating that to treat a
third

party

as

a

beneficiary

to

a

contract,

the

contracting

parties must intend to benefit directly the third party, and
such intention “must be shown by an express provision in the
contract identifying the third-party beneficiary by name or by
description
Thus,

of

a

Plaintiffs

class
do

not

to

which

have

the

third

standing

to

party

sue

for

belongs”).
breach

of

Contract No. 21472.
Although Plaintiffs were party to a separate contract with
Allied, they do not base their claims on that contract, nor does
that

relationship

Contract

No.

confer

21472.

privity
See,

on

Haake,

Plaintiffs
925

in

N.E.2d

regard
at

to

306-07.

Accordingly, Plaintiffs’ breach of contract claim against the

- 20 -

City,

Republic,

dismissed.
the

and

Allied

based

on

Contract

No.

21472

is

If Plaintiffs wish to replead this claim based on

contract

between

Plaintiffs

and

Allied,

they

must

do

so

within fourteen (14) days of the date of this Opinion.
G.

Count VI - Tortious Interference with Contract

To establish a claim of tortious interference with contract
a

plaintiff

must

plead:

(1)

the

existence

of

a

valid

and

enforceable contract between the plaintiff and another; (2) the
defendant’s awareness of the contractual relationship; (3) the
defendant’s intentional and unjustified inducement of a breach
of the contract; (4) a subsequent breach by the other caused by
the defendant’s wrongful conduct; and (5) damages.
Donegan, 700 N.E.2d 157, 160 (Ill. App. Ct. 1998).

Grund v.
Because

Plaintiffs have not alleged a viable breach of contract claim,
their claim for tortious interference with contract necessarily
fails.

See, Cohen v. Am. Sec. Ins. Co., 735 F.3d 601, 613 (7th

Cir. 2013).

The Court dismisses Count VI with leave to amend

within fourteen (14) days of the date of this Opinion.
H.

Seng Defendants’ Motion for Sanctions

Finally, the Court considers briefly the Seng Defendants’
Motion for Sanctions [ECF No. 42].

In general, Rule 11 grants

this Court the power to impose sanctions upon counsel and a
represented party, including reasonable attorneys’ fees.
CIV. PRO. 11.

FED. R.

Sanctions are appropriate when a pleading or motion

- 21 -

is neither well-grounded in fact nor warranted by existing law
or a good faith argument for the extension, modification, or
reversal

of

existing

law.

In

addition,

sanctions

are

appropriate in the event a pleading or motion is interposed for
any improper purpose, such as to harass, to cause unnecessary
delay, or to needlessly increase the cost of litigation.
Essentially,
impose

sanctions

the

Seng

against

Defendants

Defense

request

Counsel,

that

Maurice

filing a pleading for an improper purpose.

the

Court

Salem,

for

They argue that Mr.

Salem is attempting to litigate a version of the same claims
arising out of the same facts and against the same parties as a
case in Illinois state court.

The Seng Defendants claim the

Illinois state court case resulted in, among other things, a
judgment

against

LCI,

and

therefore

res

judicata

prevents

Plaintiffs from relitigating the matter in federal court.
Although the Seng Defendants raise this argument in their
Motion to Dismiss, they do so summarily without citing any case
law.

Moreover, application of res judicata turns on whether the

issues presented in this case are the same as the issues decided
by the Illinois state court in issuing its final judgment, yet
the

Seng

Defendants

neglected

to

provide

the

documentation of the state court’s decision.

Court

with

any

Although the Seng

Defendants cite to two exhibits (presumably concerning the state
court case) in their Motion for Sanctions, they actually failed

- 22 -

to attach the exhibits for the Court’s review.

The Court cannot

take judicial notice of the state court decision based entirely
on the Seng Defendants’ characterization of the case. This is
especially

true

because

Plaintiffs

contend

that

their

claims

against the Seng Defendants in the present case involve distinct
legal issues from those decided by the state court.
In

light

of

these

circumstances,

the

Court

declines

to

grant the Seng Defendants’ Motion for Sanctions at this time.
But

if

Plaintiffs

choose

to

continue

to

pursue

their

claims

against the Seng Defendants and the Seng Defendants can provide
some

documentary

proof

of

the

state

court

judgment

and

the

issues decided thereby, the Court may be open to revisiting the
request for sanctions.
IV.
For

the

reasons

CONCLUSION

stated

herein,

Defendants’

Dismiss [ECF Nos. 28, 32, 33] are granted.

Motions

to

The Court dismisses

with leave to amend all claims brought by Plaintiffs Linda and
Jesse

McGee

for

lack

of

standing.

counts of the Complaint as follows:

The

Court

dismisses

all

Count I and Count II of the

Complaint are dismissed with prejudice; Count III and Count IV
are

dismissed

without

prejudice;

Count

V

is

dismissed

with

prejudice as to the City, but without prejudice as to Republic
and Allied; and Count VI is dismissed without prejudice.

- 23 -

If

Plaintiffs do not amend the Complaint within fourteen (14) days,
these dismissals will convert into dismissals with prejudice.
In light of this conclusion, the Court also denies as moot
Plaintiffs’

Motion

Evidentiary

Hearing,

for
and

Preliminary
Motion

Injunction,

for

Leave

to

Motion

for

Present

New

Evidence [ECF Nos. 17, 56, 60].
The

Court

also

declines

to

grant

Motion for Sanctions at this time.

the

Seng

Defendants’

But if Plaintiffs choose to

continue to pursue their claims against the Seng Defendants and
the Seng Defendants can provide some documentary proof of the
state court judgment and the issues decided thereby, the Court
may be open to revisiting the request for sanctions.

IT IS SO ORDERED.

Harry D. Leinenweber, Judge
United States District Court
Dated:3/15/2016

- 24 -