Lahr v. Brigadoon Financial, Inc. et al

Filing 28

OPINION AND ORDER: DENYING 19 RULE 12(f) MOTION to Strike 15 Answer to Complaint, Counterclaim (Preliminary Statement only) by Plaintiff Marilyn K Lahr, and DENYING 20 RULE 12(f) MOTION to Strike 15 Answer to Complaint, Counterclaim (Settlement negotiations only) by Plaintiff Marilyn K Lahr. Signed by Magistrate Judge Susan L Collins on 9/9/2015. (lhc)

UNITED STATES DISTRICT COURT
NORTHER DISTRICT OF INDIANA
FORT WAYNE DIVISION
MARILYN K. LAHR,
Plaintiff/Counter-Defendant,
v.
BRIGADOON FINANCIAL, INC., and
R . BRUCE DYE,
Defendants/Counter-Claimants.

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CASE NO. 1:15-cv-00106-JD-SLC

OPINION AND ORDER
Before the Court are two motions to strike (DE 19; DE 20) filed by Plaintiff Marilyn K.
Lahr pursuant to Rule 8(a)(2), (b)(1)(A), and (d)(1), and Rule 12(f) of the Federal Rules of Civil
Procedure, seeking to strike a portion of the Answer, Other Defenses, Counterclaims, and
Demand for Jury Trial (“Answer”) (DE 15) filed by Defendants Brigadoon Financial, Inc., and
R. Bruce Dye. Lahr’s first motion seeks to strike Defendants’ six-page Preliminary Statement
from the Answer on the basis that it is verbose and alleges immaterial, impertinent, and
scandalous matter. (DE 19). The second motion seeks to strike a paragraph in both the
Preliminary Statement and Counterclaim I for the reason that it improperly reveals details
concerning the parties’ confidential settlement negotiations. (DE 20). The motions are now ripe
for ruling. (DE 22; DE 24; DE 25; DE 26).
For the following reasons, Lahr’s motions to strike will both be DENIED.
A. Factual and Procedural Background
On May 1, 2015, Lahr filed a 43-page complaint against Defendants, alleging a claim of
assault and battery against Dye in Count I; claims of negligent supervision and training,

negligent retention, breach of contract, sexual harassment, and sexual retaliation against
Brigadoon in Counts II through VI; and intentional infliction of emotional distress against both
Dye and Brigadoon in Count VII. (DE 1). On July 27, 2015, Defendants filed a 66-page
Answer, containing the six-page Preliminary Statement at the outset.1 (DE 15). In Counterclaim
1, Dye and Brigadoon advance an abuse of process claim against Lahr, and in Counterclaim 2,
Dye sues Lahr for breach of contract claim. (DE 15 at 63-65). That same day, Lahr filed a
motion to dismiss Defendants’ abuse of process counterclaim (DE 18), which remains pending,
together with the two instant motions to strike (DE 19; DE 20).
B. Applicable Legal Standard
Federal Rule of Civil Procedure 8(a)(2) requires that a pleading contain “a short and
plain statement of the claim showing that the pleader is entitled to relief[,]” and Rule 8(b)(1)(A)
provides that in responding to a pleading, a party must “state in short and plain terms its
defenses to each claim asserted against it[.]” In general, “[e]ach allegation must be simple,
concise, and direct.” Fed. R. Civ. P. 8(d)(1).
Federal Rule of Civil Procedure 12(f) states that the Court “may strike from a pleading
an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.”
“Generally speaking, motions to strike portions of pleadings are disfavored as they consume
scarce judicial resources and may be used for dilatory purposes.” Silicon Graphics, Inc. v. ATI
Techs. ULC, No. 06-C-611-C, 2007 WL 5312633, at *1 (W.D. Wis. Mar. 12, 2007) (citing
Custom Vehicles, Inc. v. Forest River, Inc., 464 F.3d 725, 727 (7th Cir. 2006); Heller Fin., Inc.

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Local Rule 10-1 requires that a responsive pleading “restate verbatim the paragraphs from the pleading
they respond to . . . .” N.D. Ind. L.R. 10-1(a)(1). Therefore, much of the length of Defendants’ Answer is consumed
with restating the lengthy allegations in Lahr’s complaint.

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v. Midwhey Powder Co., 883 F.2d 1286, 1294 (7th Cir. 1989)). Thus, motions to strike
pleadings “will generally be denied unless the portion of the pleading at issue is prejudicial.”
U.S. Liab. Ins. Co. v. Bryant, No. 3:10-cv-129, 2011 WL 221662, at *1 (S.D. Ill. Jan. 21, 2011)
(citing Heller, 883 F.2d at 1294; Tektel, Inc. v. Maier, 813 F. Supp. 1331, 1334 (N.D. Ill. 1992)).
The decision whether to strike material under Rule 12(f) is within the discretion of the district
court. Delta Consulting Grp., Inc. v. R. Randle Constr., Inc., 554 F.3d 1133, 1141 (7th Cir.
2009); Talbot v. Robert Matthews Distrib. Co., 961 F.2d 654, 665 (7th Cir. 1992).
C. Analysis
1. Lahr’s Motion to Strike the Preliminary Statement in its Entirety
Lahr’s first motion seeks to strike Defendants’ six-page Preliminary Statement in its
entirety for the reason that it is verbose and does not conform with Rule 8, which provides that a
pleading must consist of a short and plain statement of the claim or defense and be simple,
concise, and direct. See Fed. R. Civ. P. 8(a)(2), b(1)(A), (d)(1). Lahr also contends that the
Preliminary Statement should be stricken because it alleges immaterial, impertinent, or
scandalous matter.
With respect to Lahr’s verbosity argument, Defendants generally attribute the length of
their Answer to the fact that Lahr filed a 43-page complaint. Defendants explain that they
included the Preliminary Statement in their Answer to provide the reader with a plain and
concise description of their defenses and counterclaims at the outset of the lengthy document.
(DE 24 at 2).
In support of their approach, Defendants cite Fox v. Will County, in which the plaintiff
began its complaint with a narrative section entitled “Nature of the Claim.” No. 04 C 7309,

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2011 WL 6206238, at *2 (N.D. Ill. Dec. 7, 2011). The defendant moved to strike the narrative
section on the basis that it was redundant, verbose, and prejudicial. Id. The Fox court rejected
the defendant’s arguments, noting that “provid[ing] an overview of [a party’s] case . . . is
common practice when filing complaints.” Id. The court explained: “The primary purpose of
[Rule 8] is rooted in fair notice: Under Rule 8, a complaint must be presented with intelligibility
sufficient for a court or opposing party to understand whether a valid claim is alleged and if so
what it is.” Id. (alteration in original) (quoting Vicom, Inc. v. Harbridge Merch. Servs., Inc., 20
F.3d 771, 775 (7th Cir. 1994)). The court denied the defendant’s motion to strike, concluding
that the narrative section of the complaint provided the defendant with fair notice of the
plaintiff’s claims. Id.; see also Field v. Kittlaus, No. 94 C 1114, 1994 WL 505403, at *1 (N.D.
Ill. Sept. 14, 1994) (denying defendant’s motion to strike a Preliminary Statement in plaintiff’s
complaint as violative of Rule 8(a), stating that “this Court has found that the Preliminary
Statement is useful in providing information about the nature of the claim advanced by
[plaintiff]”).
Defendants argue that, like the “Nature of the Claim” section in Fox, the Preliminary
Statement helps provide the reader with adequate notice of their defenses and counterclaims.
Lahr, however, emphasizes that the Fox court stated that a preliminary statement was a common
practice when filing complaints, not answers. 2011 WL 6206238, at *2. In comparison, Lahr
points to Ramos v. Playtex Prods., Inc., Nos. 08 CV 2703, 08 CV 2828, 08 CV 3352, 2008 WL
4066250, at *5 (N.D. Ill. Aug. 27, 2008), in which the court stated that “a preliminary statement
is generally unnecessary and improper in the context of a defendant’s answer to a complaint,”
and directed the defendants to limit their answers to numbered paragraphs that were responsive
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to each paragraph of the complaint.
Here, however, in light of Lahr’s lengthy complaint and her use of detailed allegations,
and considering that Defendants are advancing counterclaims against her, the Court declines to
strike the Preliminary Statement on the basis that it is lengthy or redundant. The Preliminary
Statement addresses the central disputes between the parties and provides fair notice to Lahr of
Defendants’ counterclaims. See Logan v. Krupp, No. 3:08-cv-869 WDS, 2009 WL 2929829, at
*1 (S.D. Ill. Sept. 10, 2009) (“Motions to strike under Federal Rule 12(f) are not favored, and
are usually denied unless the language in the pleading has no possible relation to the controversy
and is clearly prejudicial.” (quoting Tektel, Inc. v. Maier, 813 F. Supp. 1333, 1334 (N.D. Ill.
1992))). “Although Rule 8 does not require such detail, it also does not necessarily preclude it.”
Mink v. Barth Elec. Co., No. 1:08-CV-0561-SEB-JMS, 2008 WL 3914068, at *2 (S.D. Ind. Aug.
19, 2008).
Lahr also seeks to strike the Preliminary Statement on the basis that it contains
immaterial, impertinent, or scandalous matter. Lahr argues that the Preliminary Statement
inappropriately: (1) emphasizes Dye’s charitable and political involvement, which she purports
is wholly irrelevant to whether he committed assault, battery, and other egregious acts; (2)
discounts Lahr’s claims for employment discrimination and sexual harassment on the basis that
she handled these types of claims for plaintiffs in her law practice and personally suffered from
workplace harassment in the past; and (3) describes Lahr’s physical attire during a purported
assault identified in the complaint. (DE 19 ¶ 11).
But to succeed on her argument, Lahr must show that “the allegations being challenged
are so unrelated to [Defendants’ counter]claim[s] as to be void of merit and unworthy of any
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consideration and that the allegations are unduly prejudicial.” Ind. Ins. Co. v. Westfield Ins. Co.,
No. 10 C 2660, 2010 WL 3404971, at *3 (N.D. Ill. Aug. 26, 2010) (citation and internal
quotation marks omitted); see also Kaufman v. McCaughtry, No. 03-C-27-C, 2003 WL
23095690, at *1 (W.D. Wis. May 22, 2003). Here, Lahr put Dye’s political activities at issue in
her complaint (DE 1 ¶ 48), and Dye’s charitable and political activities are also connected to
Defendants’ abuse of process counterclaim (DE 15 Answer ¶ 48, Counterclaims ¶¶ 7, 10). Nor
is Lahr’s past experience as an employment lawyer immaterial or prejudicial, as she raises her
work as a practicing lawyer in her complaint several times (DE 1 ¶¶ 5-6, 11-13), and Dye
mentions it in the context of his abuse of legal process counterclaim (DE 15 at 5-6). Finally,
what clothing Lahr was wearing during a purported encounter may be an unnecessary detail, but
it is not so prejudicial that it must be stricken from the pleading.
Accordingly, in these particular circumstances, Lahr’s motion to strike the Preliminary
Statement on the grounds that it is verbose and contains immaterial, impertinent, or scandalous
matter will be DENIED.
2. Lahr’s Motion to Strike Allegations Concerning Settlement Negotiations
In her second motion, Lahr seeks to strike the following paragraph from Defendants’
Preliminary Statement and Counterclaim I on the basis that it refers to the parties’ confidential
settlement negotiations:
On November 6, 2014, Lahr’s legal counsel made a written demand that Dye (1)
forego a $500,000 debt Lahr owed Dye, and (2) “sell” his CNG business to Lahr
for $11,000,000 at a time when Dye had a firm offer from a buyer for
$14,000,000. In exchange, according to Allen’s demand, the three plaintiffs
would go away. When that demand failed, Lahr abused the legal process by
threatening to seek an injunction stopping the sale of the CNG business without
any legal basis for doing so.
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(DE 15 at 2; see also DE 15 Counterclaims ¶ 8). Lahr emphasizes that the communication
referenced in this paragraph was part of ongoing settlement negotiations between the parties, and
that such communications were repeatedly identified as privileged and confidential by her
counsel. (DE 20-1 at 1, 5, 7, 11). She contends that Defendants’ description of the settlement
offer in their counterclaim for abuse of legal process was “not good faith.” (DE 20 at 3).
“[S]tatements made during settlement negotiations are confidential.” Med. Assurance
Co. v. Weinberger, No. 4:06 cv 117, 2011 WL 2115662, at *2 (N.D. Ind. May 26, 2011) (citing
Fed. R. Evid. 408(a)(1), (a)(2); Estate of Sims ex rel. Sims v. Cty. of Bureau, 506 F.3d 509, 517
(7th Cir. 2007)). “There is a strong public policy in favor of promoting settlement.” Id. (citation
omitted). “Without confidentiality, the discussions and exchange of information necessary to the
settlement process may not occur.” Id. (citation omitted).
Defendants assert that they included the paragraph describing the parties’ settlement
negotiations because it contains “facts relevant to their abuse of process counterclaim.” (DE 22
at 2). But in federal court “pleadings are adjudged under the very liberal notice pleading
standard established in Rule 8 . . . .” Cordero v. Calvary SPV I., LLC, No. 04 C 1500, 2004 WL
1244107, at *2 (N.D. Ill. June 3, 2004); see Thomson v. Washington, 362 F.3d 969, 970 (7th Cir.
2004) (“The federal rules replaced fact pleading with notice pleading.”). Under this standard, all
that is required is “that the plaintiff set out in [his or her] complaint a short and plain statement
of the claim that will provide the defendant with fair notice of the claim.” Brooks v. Harding,
No. IP98-1200-C-T/G, 2001 WL 548098, at *5 (S.D. Ind. Mar. 30, 2001) (internal quotation
marks omitted) (quoting Anderson v. Simon, 217 F.3d 472, 474 (7th Cir. 2000)).

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As such, Defendants could have advanced their claim, yet maintained some semblance of
confidentiality by omitting much of the factual details about the parties’ settlement negotiations.
That is, Defendants could have simply alleged that Lahr made a settlement offer, and that when
Defendants rejected it, she abused the legal process by threatening to seek an injunction to stop
the sale of Dye’s business without any legal basis for doing so. Nevertheless, the settlement
negotiations have now been disclosed, and requiring Defendants to file an amended complaint
for the sole reason of restating this paragraph would be inefficient.
A pleading “is not evidence; rather, it sets forth allegations.” BPI Energy, Inc. v. IEC
(Montgomery), LLC, No. 07-186-DRH, 2007 WL 3355363, at *1 (S.D. Ill. Nov. 13, 2007).
“Where the settlement negotiations and terms explain and are a part of another dispute they must
often be admitted if the trier is to understand the case.” Id. at *2 (internal quotation marks and
citation omitted) (quoting Central Soya Co. v. Epstein Fisheries, Inc., 676 F.2d 939, 944 (7th
Cir. 1982)).
Contrary to Lahr’s assertion (DE 26 ¶ 12), Defendants are not offering the settlement
communications to prove or disprove the validity or amount of a disputed claim. See Fox, 2011
WL 6206238, at *5. Rather, Defendants include the settlement negotiations as background for
their counterclaim that Lahr abused the legal process after Defendants rejected her settlement
offer. See id. Therefore, the Court will not strike the settlement negotiations from the Answer.
That is not to say, however, that the settlement negotiations will be accepted as evidence under
Federal Rule of Evidence 408 in relation to a dispositive motion or at trial; those evidentiary
rulings are not before the Court at this juncture. Id.; see Valley Forge Ins. Co. v. Hartford Iron
& Metal, Inc., No. 1:14-cv-6, 2015 WL 1825567, at *4-5 (N.D. Ind. 2015) (rejecting defendant’s
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argument that plaintiff’s motion to amend should be denied because the proposed amendment
included settlement materials, stating that defendant may renew its objection under Rule 408 if
and when plaintiff attempts to use any settlement materials as evidence).
Accordingly, Lahr’s motion to strike Defendants’ allegations concerning settlement
negotiations in the Preliminary Statement and Counterclaim I will also be DENIED.
D. Conclusion
For the foregoing reasons, Lahr’s Motion to Strike Preliminary Statement (DE 19) and
Motion to Strike Allegations Concerning Settlement Negotiations (DE 20) are both DENIED.
SO ORDERED.
Enter for this 9th day of September 2015.
S/ Susan Collins
Susan Collins
United States Magistrate Judge

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