Tri-State Disposal, Inc. v. The Village of Riverdale et al

Filing 82

OPINION AND ORDER. Signed by the Honorable Sara L. Ellis on 9/21/2020. Mailed notice(rj, )

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
TRI-STATE DISPOSAL, INC.,
an Illinois corporation,
Plaintiff,
v.
THE VILLAGE OF RIVERDALE,
a municipal corporation; and
LAWRENCE JACKSON,
Mayor of the Village of Riverdale,
Defendants.

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No. 18 C 2138
Judge Sara L. Ellis

OPINION AND ORDER
Before the Court is Plaintiff Tri-State Disposal, Inc.’s (“Tri-State”) motion for leave to
file a third amended complaint (“TAC”) pursuant to Federal Rule of Civil Procedure 15(a). TriState seeks to amend its complaint to add additional factual allegations, request punitive
damages, and request attorneys’ fees. Defendants Mayor Lawrence Jackson and the Village of
Riverdale (“the Village”) argue that Tri-State’s amendments are untimely and unduly prejudicial.
The Court grants Tri-State’s motion because Defendants were on notice of the claims that the
new factual allegations elaborate upon and there is no reason that Tri-State cannot request
punitive damages and attorneys’ fees at this stage.
BACKGROUND 1
After the Village passed an ordinance granting Riverdale Materials, LLC a special use
permit to operate a waste collection business in Riverdale, Illinois, where Tri-State also operated
a waste-collection business, Tri-State filed this lawsuit against Defendants. The Court later

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The Court presumes familiarity with the factual background set forth in its January 28, 2020 opinion,
Doc. 67, and does not recount all of the factual allegations here.

dismissed Tri-State’s first amended complaint (“FAC”) in part. Doc. 45. The Court dismissed
Tri-State’s due process claims for failure to allege deprivation of a protected property interest.
The Court also dismissed Tri-State’s equal protection claim because the FAC and exhibits
demonstrated a conceivable rational basis for the Village’s decision to pass the ordinance.
Finally, the Court dismissed Tri-State’s claim for common law certiorari review of the
ordinance, as the zoning decision involved a legislative, rather than administrative, action.
Notwithstanding, the Court concluded that Tri-State sufficiently pleaded its political retaliation
and breach of contract claims. Tri-State subsequently filed a second amended complaint
(“SAC”). In the SAC, Tri-State made minor changes to the FAC, realleged due process, breach
of contract, and political retaliation claims against Defendants, and did not plead any new claims.
The Court again dismissed Tri-State’s due process claims with prejudice but found that Tri-State
could proceed on its claims for political retaliation and breach of contract. Doc. 67. On May 15,
2020, Tri-State filed a motion seeking leave to file its TAC. Although fact discovery was
scheduled to close on March 31, 2020, on March 17, the parties filed a joint motion to extend
fact discovery due to the challenges of taking depositions at the beginning of the COVID-19
pandemic. The Court extended discovery until October 31, 2020.
LEGAL STANDARD
Rule 15(a)(2) provides that amendments to the pleadings are allowed “only with the
opposing party’s written consent or the court’s leave,” with the Court instructed to “freely give
leave when justice so requires.” Fed. R. Civ. P. 15(a)(2). This is a liberal standard that the
Supreme Court has held “to require a district court to allow amendment unless there is a good
reason—futility, undue delay, undue prejudice, or bad faith—for denying leave to amend.” Life

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Plans, Inc. v. Sec. Life of Denver Ins. Co., 800 F.3d 343, 357–58 (7th Cir. 2015) (citing Foman v.
Davis, 371 U.S. 178, 182 (1962)).
ANALYSIS
Tri-State seeks leave to add factual allegations to its retaliation claims, request punitive
damages against Mayor Jackson, and add a prayer for attorneys’ fees if it succeeds on its
retaliation claims. The TAC also removes the due process claims that this Court previously
dismissed. Defendants respond that the Court should deny the requested leave because Tri-State
has unduly delayed pleading factual allegations that it has been aware of since at least 2018.
Defendants also contend that Tri-State’s additional factual allegations would be prejudicial
because they amount to three new theories of political retaliation two years into the litigation.
Although Defendants broadly challenge all amendments together, the Court separately addresses
each category of amendments for clarity.
I.

Factual Allegations
Tri-State seeks to add numerous factual allegations to its retaliation claims and

categorizes them as follows: (1) additional facts regarding the spring clean-up; (2) additional
facts regarding Tri-State not having the opportunity to bid for the garbage contract; (3) additional
facts regarding the Village’s interference with Tri-State’s contracts with multi-family residences;
and (4) additional facts regarding the Village’s refusal to pay Tri-State and delay in payments to
Tri-State. Defendants argue that Tri-State has been on notice and aware of these allegations
since at least 2018 and therefore has unduly delayed pleading these allegations. Defendants also
contend that they will be prejudiced by these allegations because they have already deposed TriState’s representatives and these allegations increase litigation costs.

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“Undue prejudice occurs where the amendment ‘brings entirely new and separate claims,
adds new parties, or at least entails more than an alternative claim or a change in the allegations
of the complaint and where the amendment would require expensive and time-consuming
additional discovery.’” Barwin v. Vill. of Oak Park, No. 14 C 6046, 2020 WL 136304, at *7
(N.D. Ill. Jan. 13, 2020) (quoting Lanigan v. LaSalle Nat’l Bank, 108 F.R.D. 660, 662 (N.D. Ill.
1985)). Defendants, as the non-moving party, have the burden of establishing undue prejudice.
See id. (citing Parker v. EMC Mortg. Corp., No. 11-CV-05682, 2014 WL 7205474, at *3 (N.D.
Ill. Dec. 18, 2014)). Here, Tri-State does not seek to add new claims or parties; instead, Tri-State
seeks to add supplemental facts that further support its claims. Specifically, Tri-State has added
more information about the spring clean-up, including the Village’s payment to the Flood
Brothers and communications with customers about the clean-up. Doc. 74-1 ¶¶ 69–74.
Additionally, Tri-State includes additional allegations about correspondence it received from the
Village regarding accepting proposals from other companies and ultimately not renewing TriState’s contract. Id. ¶¶ 75–79. The new allegations also reflect the Village’s ultimate decision to
retain another company and the relevant resolution authorizing such agreement. Id. ¶¶ 80–81.
These allegations all relate to Tri-State’s claim that Defendants retaliated against it for exercising
its First Amendment rights and filing a lawsuit. Although Tri-State could have added these
particular allegations in support of their claims earlier, Defendants have been on notice of TriState’s claims. Moreover, Defendants are included on the correspondence that Tri-State seeks to
add allegations about and will therefore not be prejudiced by the amendments. See Barwin, 2020
WL 136304, at *7 (rejecting the defendants’ argument that they would be prejudiced by a new
theory of liability where the original complaint asserted a similar, general claim); Parker, 2014
WL 7205474, at *4 (“Because these new allegations would merely provide additional support for

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a legal theory of which Defendants have been on notice for almost three years, the Court finds
that Defendants would suffer no prejudice from these amendment[s].”).
Moreover, although Plaintiffs have amended their complaint to state that “[t]he motion to
terminate the Village’s agreement with Tri-State and subsequent decision to retain Flood
Brothers on a no-bid contract were made in retaliation for Plaintiff’s free speech,” this does not
significantly alter the underlying retaliation claims but instead provides additional facts in
support of retaliation. Doc. 74-1 ¶ 82 (emphasis added to indicate new language). Similarly,
Tri-State’s new factual allegations relating to the Village’s refusal to pay relate to the allegations
in Tri-State’s previous complaints. Tri-State previously asserted that that the Village was
obligated to pay Tri-State’s outstanding invoices. See Doc. 49 ¶ 73(d). Tri-State asserts that it
learned during discovery that the Village paid Flood Brothers while Tri-State’s invoices were
outstanding, which also indicates that these amendments are permissible. Kitchen v. Burge, No.
10 C 4093, 2011 WL 4974350, at *1 (N.D. Ill. Oct. 13, 2011) (“In fact, because [the plaintiff]
recently discovered the new facts he now proposes to add to his complaint, allowing amendment
is appropriate.”). Additionally, although Defendants claim that they will incur additional costs
due to these new factual allegations, the Court cannot see why these allegations would impose
additional costs on the parties. Defendants have been on notice of such claims, only some
depositions have occurred based on the parties’ briefing, and Defendants do not specify what
additional discovery is now necessary. Barwin, 2020 WL 136304, at *7 (no undue prejudice
where the defendant did “not show that any expensive or time-consuming additional discovery
will be required because of the proposed amendments”).
The new factual allegations regarding Defendants’ interference with Tri-State’s business
with multi-family residences present a closer question. Doc. 34-1 ¶¶ 84–96. Those allegations

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relate to Village Ordinance 2018-22, which required multi-family residences to utilize Flood
Brothers’ refuse services. The SAC does not mention this ordinance or any agreements with
multi-family residences. Instead, Tri-State seeks to assert allegations regarding its independent
contracts with residents with which the Village allegedly interfered. Although Tri-State did not
include these allegations in its SAC, these allegations do not assert a new theory of liability. TriState puts forth these factual allegations to demonstrate that Defendants retaliated against it by
interfering with Tri-State’s contracts with multi-family residences. Because these allegations
again relate to Tri-State’s retaliation claims, of which Defendants have been on notice, and lend
additional support for these claims, the Court does not find them unduly prejudicial. Xerox Fin.
Servs. Life Ins. Co. v. Salomon Bros. Inc., No. 92 C 1767, 1993 WL 78721, at *2 (N.D. Ill. Mar.
18, 1993) (no prejudice where the amendment “merely puts a slightly different spin on legal
theory and conduct the amended complaint already alleges”).
Additionally, Defendants’ reliance on Hukic v. Aurora Loan Services to show undue
prejudice is not persuasive. 588 F.3d 420 (7th Cir. 2009). There, the plaintiffs sought to add
eleven new claims against the existing defendants and add another defendant. Id. at 432. The
court explained that the plaintiff sought leave to amend his complaint three days before the close
of fact discovery, and the parties had already conducted discovery on the other claims. Id. Here,
Tri-State does not seek to add additional claims but only includes facts that support its
underlying claims. Additionally, Tri-State moved to amend its complaint with over five months
remaining of discovery. The Court finds that for the reasons previously discussed, these
additional factual allegations do not unduly prejudice Defendants.
Finally, Defendants make much of the fact that Tri-State seeks to add factual allegations
two years into the litigation. However, “delay is an insufficient basis for denying a motion to

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amend unless this delay results in undue prejudice to the opposing party.” Tragarz v. Keene
Corp., 980 F.2d 411, 432 (7th Cir. 1992) (citation omitted); see also George v. Kraft Foods
Glob., Inc., 641 F.3d 786, 791 (7th Cir. 2011) (“Plaintiffs point out that delay alone is not a
reason to deny a proposed amendment, and that delay must be coupled with some other reason,
such as prejudice to the defendants.”). Again, here, the Court cannot find that Defendants would
be prejudiced, especially where the factual allegations seek to provide additional clarity to claims
of which Defendants have been on notice. Cf. Shefts v. Petrakis, 954 F. Supp. 2d 769, 789 (C.D.
Ill. 2013) (addition of legal theories based on the same alleged injury “do[es] not fundamentally
change the complaint, and cannot be considered an unfair surprise to a defendant” (internal
quotation marks omitted)).
II.

Punitive Damages
Tri-State also seeks leave to amend its SAC to request punitive damages against Mayor

Jackson. Although this proposed amendment is late in the litigation, Tri-State sought this
amendment with approximately five months of discovery remaining. At the end of July, TriState represented that the parties still had not deposed Mayor Jackson or Defendants’ agents,
which will likely be relevant for the punitive damages determination. See Doc. 80 at 6.
Therefore, discovery remains open and Defendants have adequate time to address Tri-State’s
punitive damages request. See King v. Chapman, No. 09 C 1184, 2014 WL 7450433, at *4
(N.D. Ill. Dec. 30, 2014) (rejecting the defendants’ argument that the court should not allow the
plaintiff to seek punitive damages where the plaintiff expressed such intent during the drafting of
the final pretrial order).
Additionally, Defendants have failed to show how the addition of punitive damages is
unduly prejudicial. Again, Tri-State has neither indicated that this amendment will require

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additional discovery nor that it will delay case proceedings. See Neal v. Target Corp., Home
Niches, Inc., No. 13 C 5907, 2015 WL 4021050, at *6 (N.D. Ill. July 1, 2015) (granting leave to
amend complaint after close of fact discovery to add punitive damages request in part because
amendment would not require additional discovery or delay case proceedings); see also Gonzalez
v. Pioneer Indus. Sys., LLC, No. 15-CV-11583, 2018 WL 1124419, at *3 (N.D. Ill. Mar. 1, 2018)
(allowing the plaintiff to amend complaint to seek punitive damages and explaining that the court
could decline a punitive damages jury instruction at trial if the evidence could not support a
punitive damages award). Further, Federal Rule of Civil Procedure 54(c) provides that every
final judgment, except a default judgment, “should grant the relief to which each party is entitled,
even if the party has not demanded that relief in its pleadings.” Fed. R. Civ. P. 54(c); see also
Back Drs. Ltd. v. Metro. Prop. & Cas. Ins. Co., 637 F.3d 827, 831 (7th Cir. 2011) (under
Rule 54(c), “juries can award damages not requested by the complaint”). This suggests that a
jury may award punitive damages even if the complaint does not specifically request them.
Soltys v. Costello, 520 F.3d 737, 742 (7th Cir. 2008) (“Rule 54(c) contemplates an award of
punitive damages if the party deserves such relief—whether or not a claim for punitive damages
appears in the complaint.”); see also King, 2014 WL 7450433, at *3 (“[P]laintiff would not be
barred from seeking [punitive damages] at trial” even if the complaint did not request them);
Curtis v. TransCor Am., LLC, 877 F. Supp. 2d 578, 595–96 (N.D. Ill. 2012) (granting the
plaintiff’s motion to allow punitive damage relief under Rule 54(c) thereby permitting the
plaintiff to pursue punitive damages at trial). The Seventh Circuit has not decided whether
punitive damages qualify as “special damages” that must be specifically pleaded in a complaint
under Rule 9(g), and Defendants have not argued that they should be considered as such. See

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Soltys, 520 F.3d at 742. Therefore, Rule 54(c) provides additional support for the Court’s
decision to grant Tri-State leave to request punitive damages in its TAC.
III.

Attorneys’ Fees
Tri-State also seeks leave to add an amendment requesting attorneys’ fees. A court has

discretion to award reasonable attorneys’ fees to a prevailing party in a § 1983 action. See 42
U.S.C. § 1988. Generally, a prevailing party moves for such costs once a court renders a
judgment. Defendants cite no cases indicating that a plaintiff must request attorneys’ fees in its
complaint in order to later move for an award of attorneys’ fees, and the Court cannot identify
any cases. Further, such requirement would not make sense in light of the fact that a prevailing
defendant can also move for attorneys’ fees. Therefore, the Court concludes that allowing TriState to add a request for attorneys’ fees would not prejudice Defendants or be untimely. If it
prevails, Tri-State can move for attorneys’ fees, and the Court will decide whether to grant such
fees at that time. The Court grants Tri-State’s request to amend its complaint to request
attorneys’ fees.
CONCLUSION
For the foregoing reasons, the Court grants Tri-State’s motion for leave to file a third
amended complaint [74].

Dated: September 21, 2020

______________________
SARA L. ELLIS
United States District Judge

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