Dix v. Edelman Financial Services, LLC et al
Filing
89
OPINION and Order. Signed by the Honorable Charles R. Norgle, Sr on 2/28/2018. Mailed notice. (sxb, )
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
GERALD DIX,
Plaintiff,
No. l7 CV 6561
v.
Hon. Charles R. Norgle
EDELMAN FINANCIAL SERVICES, LLC Et AI.,
Defendants.
OPINION AND ORDER
Pro se Plaintiff Gerald Dix ("Plaintiff') brings this action against thirteen separate
defendants, including Edelman Financial Services, LLC ("Edelman") and its alleged agents, Jane
Doe
#l
("Doe #1") and Jane Doe #2 ("Doe #Z").The Court, sua sponte, struck PlaintifPs original
Complaint, finding that it was o'replete with redundant, impertinent, and scandalous allegations."
October 3,2017 Order, Dkt. 12. Thereafter, Plaintiff filed his First Amended Complaint ("FAC"),
totaling forty-four pages' and alleging nineteen separate claims.
Plaintiff s FAC
asserts the
following claims against Edelman and its alleged agents: Count V,
Conspiracy to Defraud; Count VI, Fraudulent Misrepresentation; Count
Trespass to Chattels; Count X, Negligence; Count
and Count
VIII, Conversion
and
XVII, Intentional Infliction of Emotional Distress;
XVIII, Vicarious Liability. Before the Court is Edelman's motion to dismiss pursuant to
Federal Rules of Civil Procedure 9(b) and l2(bX6). For the reasons that follow, the motion is
granted.
' Plaintiffs original Complaint totaled thirfy-three pages. After the Court instructed Plaintiff that his Complaint was
replete with redundant, impertinent, and scandalous allegations, he filed his First Amended Complaint, containing
an additional eleven pages, exclusive ofexhibits.
I. BACKGROUND
Plaintiff s FAC revolves around what he views
as a
"wrongful eviction" from a residence in
Lisle, Illinois, owned by Defendant Theresa Miller ("Miller"). According to Plaintiff, he was
engaged in a "platonic relationship" with
Miller. He also claims Miller was his landlord. FAC flfl 21,
26. As previously noted by the Court in its October 3,2017 Order, Plaintiff s case "smacks of a
domestic dispute," given that all of his claims are related in some way to his relationship with Miller.
The FAC asserts that after Miller lost her job in May 2017 , she met with an Edelman
financial advisor, Doe #1, in order to withdraw funds from her investment portfolio. Plaintiff asserts
that Doe
#l
refused to release funds from Miller's portfolio, and instead advised Miller to "steal
financial funds from the Plaintiff' and "convince the Plaintiff that he should obtain full-time
employment" in order to replace her lost income. Id. fll[ 36, 45. Plaintiff further asserts that Doe # I
advised Miller that she should "sell her Lisle home and go live in the ghetto with her mother and
stepfather." Id. 1T39. Plaintiff also asserts that after Miller decided to move from her home in Lisle,
Doe
#l
recommended Doe #2 as a "moving professional," when Doe #2 was actually a"lazy elderly
woman" who assisted Miller in destroying and stealing Plaintiff s personal property. Id.flfl 87-88,
252.
II. DISCUSSION
A. Standard of Review
Under Rule 9(b), a plaintiff alleging fraud "must state with particularity the circumstances
constituting fraud." Fed. R. Civ. P. 9(b). The complaint must allege "the 'who, what, when, where,
and how' of the
fraud-'the first
paragraph of any newspaper story."' Pirelli Armstrong Tire Corp.
Retiree Med. Benefits Trust v. Walgreen Co., 631 F.3d 436, 44142 (7th Cir.20l l ) (quoting U.S. ex
rel. Lusby v. Rolls-Royce Corp., 570 F.3d 849, 854 (7th Cir. 2009)). "Rule 9(b) applies to
oaverments
of fraud,' not [only] claims of fraud, so whether the rule applies will depend on the
[plaintiffls] factual allegations." Borsellino v. Goldman
Sachs Group.
Inc.,477 F.3d 502,507 (7th
Cir.2007).
"Although aparty need not plead 'detailed factual allegations' to survive a [Rule l2(b)(6)]
motion to dismiss, mere 'labels and conclusions' or'a formulaic recitation of the elements of a cause
of action will not do."' Berger v. Nat'l Collegiate Athletic Ass'n, 843 F.3d 285,290 (7th Cir. 2016\
(quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544,555 (2007)). "lnstead, [t]o survive a motion
to dismiss, a complaint must contain sufficient factual matter, accepted as true, to state a claim for
relief that is plausible on its face." Id. (citing Ashcroft v. Iqbal, 556 U.S. 662,678 (2009)) (internal
quotation marks omitted). Complaints that fail to state a plausible basis for relief must be dismissed.
Moore v. Mahone, 652 F.3d 722,725 (7th Cir. 201 l).
B. Plaintif?s FAC Fails to Comply with the Court's October 3,2017 Order
Edelman first argues that the FAC should be dismissed because it essentially recites the same
allegations as the original Complaint that the Court struck in its October 3,2017 Order. Under Rule
l2(f;, "the court may strike from
a pleading any redundant, immaterial, impertinent, or scandalous
matter." Edelman is correct that Plaintiff has failed to comply with the Court's October 3,2017
Order. Despite Plaintiff s amendments, the FAC is stillreplete with redundant, immaterial,
impertinent, and scandalous allegations. Perhaps the most egregious example is Plaintifls use of
nearly an entire page of the FAC to dispute the Seventh Circuit Order in Case No. I 4-30 I 5, wherein
the Seventh Circuit warned Plaintiffthat further frivolous appeals may result in sanctions. Plaintiff
s
blatant refusalto comply with the Court's October 3,2017 Order is sufficient alone to dismiss his
claims against Edelman with prejudice. See Salata v. Weyerhaeuser Co. ,757 F.3d 695" 699 (7th Cir.
2014)
("A court may dismiss
an action with prejudice
'if
the plaintifffails to...comply with [the
Federal Rules of Civil Procedure] or any court order."'(quoting Fed. R. Civ. P.
al(b));
see also
Stanard v. Nygren, 658 F.3d 792, 801 (7th Cir. 2011) ("The principle that leave to amend should be
freely granted does not require district judges to repeatedly indulge flitigants] who show little ability
or inclination to comply with the rules."). Further, the Court reminds Plaintiffthathis pro se status
does not shelter him from sanctions pursuant to Rule
1445 (7th
11
. Vukadinovich v.
McCarthy,90l F .2d 1439,
Cir. 1990).
C. Plaintiff Fails to State
a Claim
for Conspiracy to Defraud
Next, Edelman argues that Plaintiff s allegations of fraud failto satisfy the heightened
pleading standards under Rule 9(b). In Count V, Plaintiff asserts that Miller, Edelman, and Doe
"conspired together to defraud financial funds from... Plaintiff." FAC
nn4.
#l
Under Illinois law,
"[t]he elements of a cause of action for conspiracy to defraud are: (1) a conspiracy; (2) an overt act of
fraud in furtherance of the conspiracy; and (3) damages to the plaintiffas a result of the fraud."
Bosak v. McDonough, 549 N.E.2d 643,646
(lll. App.
1989).
Here, despite the voluminous nature of the FAC, Plaintiff fails to set forth with particularity
the facts and circumstances constituting the claimed conspiracy to defraud. Although the FAC claims
Plaintiff has in depth knowledge of certain investment advice given to Miller by Doe #1, the FAC
fails to provide any significant details regarding the identity of Doe #1. Further, Plaintiff
conclusory allegation that that Miller, Edelman, and Doe
#l
s
conspired together to defraud him is
inconsistent with numerous other allegations in the FAC. Most notably, Plaintiff asserts that Doe
#l
instructed Miller to convince Plaintiff to obtain full-time employment to replace Miller's lost income
and that Doe
#l
advised Miller to force Plaintiff to finance her while she was unemployed. Put
differently, the FAC attempts to contort Doe
#l's
alleged advise to Miller into an agreement to
defraud Plaintiff. In short, Plaintiff s sparse, conclusory, and inconsistent allegations are insufficient
to support a plausible claim for conspiracy to defraud, let alone state the claim with requisite
particularity. Ackerman v. N.W. Mut. Life Ins. Co. , 172 F .3d 467, 469 (7th Cir. 1999) (stating that
the purpose of Rule 9(b) is to dissuade claims of fraud brought "irresponsibly by people who have
[allegedly] suffered a loss and want to find someone to blame for it"). Accordingly, Plaintiff s claim
against Edelman for conspiracy to defraud is dismissed.
D. Plaintiff Fails to State a Claim for Fraudulent Misrepresentation
In Count VI, Plaintiff attempts to set forth a claim for fraudulent misrepresentation alleging
that Doe
#l
represented Doe #2 as a professional mover and that Doe #2 represented herself as a
professional mover, when it was known that Doe #2 was not a professional mover. Under lllinois
law, the elements for a cause of action for fraudulent misrepresentation are:
"(l)
a false statement
of
material fact; (2) known or believed to be false by the person making it; (3) an intent to induce the
plaintiffto act; (4) action by the plaintiff
in justifiable reliance on the truth of the statement; and (5)
damage to the plaintiff resulting from such reliance." Doe v.
Dilling, 888 N.E.2d24,35-36 (lll.
2008).
Here, similar to the Court's analysis above, Plaintifffails to allege with particularity the
identity of Doe #2.The FAC claims that Plaintiff was present when Doe #2 came to Miller's home in
Lisle on August 22,2017. However, the FAC contains no details regarding the identity of Doe #2
other than the scandalous allegation that she was a"lazy elderly woman." FAC fl 88. Further, the
FAC states that Doe
#l
recommended Doe #2 as a professional mover to Miller, not to Plaintiff. But
the FAC is silent as to how Doe
#
I
intended to induce Plaintiff into hiring Doe #2 or how Plaintiff
came to rely on the recommendation made to
Miller alone. Rather, the FAC asserts in conclusory
fashion that "Plaintiff and Miller relied on Doe #2 as a professional mover." ld.1124l. Miller's
reliance is irrelevant however, because she is a defendant in this case. The FAC also emphasizes that
Doe #2 was readily identifiable as someone who was not a professional mover. Id. u 88-91. Thus,
taking Plaintiff s allegations as true, he could not have justifiably relied on Doe #l 's
recommendation of Doe#2to Miller. Accordingly,
Plaintifls claim against Edelman for fraudulent
misrepresentation is dismissed.
E. Plaintiff Fails to Allege Doe#2 was Edelman's Agent and Otherwise Fails to State
for Conversion or Trespass to Chattels
a Claim
Count VII of the FAC asserts claims for conversion and trespass to chattels. Plaintiff
contends that Doe #2, along with Miller, destroyed and stole Plaintiff s personal property, while Lisle
Police Officers Rob Sommer ("Sommer") and Sean McKay ("McKay") restrained Plaintiff outside of
Miller's Lisle home during what he refers to as a "wrongful eviction." Edelman argues that to the
extent Plaintiffseeks relief against Edelman in Count
Edelman in Count
VIII-he
VIIl-Plaintiff
does not specifically refer to
fails to adequately allege that Doe #2 was Edelman's agent. The Court
agrees.
The FAC fails to even plausibly suggest Edelman exercised control over Doe #2. Chemtool.
Inc. v. Lubrication Techs..lnc., 148 F.3d 742,745 (7th Cir. 1998) (Under Illinois law, "[t]he testto
determine whether a principal-agent relationship exists is whether the alleged principal has the right
to control the agent, and whether the alleged agent can affect the legal relationships of the
principal."). Further, the FAC fails to allege that Edelman acted in a manner which would lead a
reasonably prudent person to believe Doe #2 was authorizedto act on behalf of Edelman. Thus,
Plaintiff fails to allege that Doe #2 was an agent of Edelman under the doctrine of apparent authority.
Gilbert v. Sycamore Mun. Hosp. , 622N.8.2d 788, 795
(lll.
1993) (Apparent authority is "the
authority which a reasonably prudent person, exercising diligence and discretion, in view of the
principal's conduct, would naturally suppose the agent to possess.").
Plaintiff also fails to properly allege the requisite elements for his claims of trespass to
chattels and conversion. Under Illinois law, the common law tort of trespass to chattel "provides
redress for unauthorized use of or intermeddling with another's physical property." Barnes v. N.W.
Repossession. LLC, 210 F. Supp. 3d
a claim
954,971(N.D. Ill. 2016) (emphasis added). Further, to establish
of conversion under Illinois law, the plaintiff must prove, inter alia, that "he has an absolute
and unconditional right to the immediate possession of the property." Zissu v. IH2 Prop. Illinois.
L.P., 157 F. Supp.3d797,803 (N.D. I11.2016).
6
Here, the FAC asserts that Doe #2was authorized by officers Sommer and McKay to remove
Plaintiff s personal property from Millers home, and that Plaintiff was not permitted to enter the
home. FAC
fl l22.Thus, the FAC concedes that Doe #2's actions
were authorized and that
did not have the right to immediate possession of his personal property. Accordingly,
Plaintiff
Plaintiff
s
claims against Edelman for trespass to chattels and conversion are dismissed.
F. Plaintiff Fails to State
a Claim for Negligence
In Count X, Plaintiff asserts a claim for negligence against Edelman and Doe
#l for their
purported breach of an "implied covenant of good faith and fair dealing," arising from Doe #1's
advice to Miller that she should take funds from Plaintiff rather than withdraw funds from her
investment portfolio. FAC fl 269. According to Plaintiff, the implied covenant of good faith and fair
dealing was part of an oral contract he formed with Miller goveming their landlord-tenant
relationship. FAC fl 42. Edelman argues that Count X should be dismissed because Plaintiff fails to
properly allege that Edelman owed Plaintiffa legal duty. The Court agrees. Under Illinois law, a
claim of negligence requires the Plaintiffto allege:
plaintiff by the defendant; (2)
"(l)
the existence of a duty of care owed to the
a breach of that duty, and (3) an injury proximately caused by that
breach." Guvenoz v. Target Corp., 30 N.E.3d 404, 422
(lll. App.
2015). "Whether a duty exists in a
particular case is a question of law to be determined by the court." Ward v. K Mart Corp., 554
N.E.2d 223,226 (ilI. 1990).
Here, the FAC claims that the oral contract was between Plaintiff and Miller alone. Thus,
even
if
such a contract existed, it would not give rise to a duty owed by Edelman to Plaintiff. Racky
v. Belfor USA Group. Inc., 83 N.E.3d 440, 468 (lll. App. 2017) ("a defendant's duty will not be
extended beyond the duties described in the contract" (internal quotations marks omitted)).
Moreover, "an alleged violation of the implied covenant of good faith cannot form the basis for an
independent tort action." Wilson v. Career Educ. Corp.,729 F.3d 665,673 (7th Cir. 2013). The FAC
also concedes that Plaintiff had no relationship with Edelman and that Plaintiff never even
communicated directly with Doe #1. Put simply, the FAC offers no facts under which Edelman owed
of care to Plaintiff. Accordingly, Plaintiff s claim against Edelman for negligence is
a duty
dismissed.
G. Plaintiff Fails to State
a Claim
for Intentional Infliction of Emotional Distress
In Count XVII, Plaintiff asserts a claim for intentional infliction of emotion distress against
all Defendants. Under Illinois law, "[i]n order to state a cause of action for intentional infliction of
emotional distress, a party must allege facts which establish that: (l ) the defendant's conduct was
extreme and outrageous; (2) the defendant either intended that his conduct should inflict severe
emotional distress, or knew that there was a high probability that his conduct would cause severe
emotional distress; (3) the defendant's conduct in fact caused severe emotional distress." Doe v.
Calumet City, 641 N.E.2d 498, 506
(lll.
1994). Liability for intentional infliction of emotion distress
"'does not extend to mere insult, indignities, threats, annoyances, peffy oppressions or trivialities'
and can attach 'only in circumstances where the defendant's conduct is so outrageous in character,
and so extreme in degree, as to go beyond all possible bounds of decency."' Hernandez v. Dart, 635
F. Supp. 2d798,813 (N.D.
Ill. 2009) (quoting Thomas v. Fuerst, 803 N.E.2d 619,625 (lll. App.
2004)).
Here, Plaintiff fails to allege that Edelman engaged in any "extreme and outrageous"
conduct. Chisholm v. Foothill Capital Corp., 940 F. Supp. 1273,1286 (N.D.
plaintiff
as
s
Ill.
1996) (dismissing
claim for intentional infliction of emotional distress because plaintiffls allegations, taken
true, did not rise to the level of outrageous conduct). Rather, Edelman's alleged conduct amounts
to de minimrs indignities or trivialities at worst. Accordingly, Plaintiff s claim against Edelman for
intentional infliction of emotional distress is dismissed.
H. Vicarious Liability
is Not an Independent Cause of Action
In Count XVIII, Plaintiff asserts a claim for vicarious liability against Edelman, based on
Doe
#l's
purported conduct as an agent of Edelman. However, under Illinois law, "vicarious liability
8
is not itself a claim or cause of action." Wilson v. Edward Hosp., 981 N.E.2d971,980
(Ill. 2012).
Accordingly, Count XVIII is dismissed.
III. CONCLUSION
For the foregoing reasons, Edelman's motion to dismiss is granted. Counts V, VI,
XVII,
and
XVIII of Plaintiffs FAC
VIII, X,
are dismissed with prejudice, to the extent that these counts
assert claims against Edelman, Doe #1, and/or Doe #2.
IT IS SO ORDERED.
CHARLES RONALD NORGLE,
United States District Court
DATE:February 28,2018
9
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