Mack v. Detroit, City of et al
Filing
47
OPINION and ORDER Granting Defendants' Motion to Enforce Settlement 38 , Dismissing the Case Without Prejudice, and Denying Plaintiff's Motion to Compel 39 as Moot Signed by District Judge Mark A. Goldsmith. (CHad)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
RICHARD MACK,
Plaintiff,
vs.
Case No. 12-cv-10300
HON. MARK A. GOLDSMITH
CITY OF DETROIT, et al.,
Defendants.
__________________________________/
OPINION AND ORDER GRANTING DEFENDANTS’ MOTION TO ENFORCE
SETTLEMENT (Dkt. 38), DISMISSING THE CASE WITHOUT PREJUDICE, AND
DENYING PLAINTIFF’S MOTION TO COMPEL (Dkt. 39) AS MOOT1
Plaintiff Richard Mack filed the instant action against Defendants City of Detroit, Mia
Nikolich, and R. Nill on January 24, 2012, alleging constitutional violations, as well as state
claims for assault and battery, intentional infliction of emotional distress, and malicious
prosecution. Compl. (Dkt. 1).
The parties appeared for a settlement conference before the Court on July 8, 2013. At
that conference, the parties agreed — subject to approval by the Detroit City Council and
Emergency Manager — to undergo binding high/low arbitration, and this agreement was placed
on the record. See 7/8/2013 Tr. (Dkt. 38 at 18-27 of 28 (cm/ecf pages)).2 Counsel examined
Plaintiff on the record to ensure that he understood and agreed to the terms of the agreement. As
relevant here, the following line of questioning occurred with Plaintiff:
1
The Court concludes that oral argument would not assist with resolution of the instant motions.
See E.D. Mich. LR 7.1(f)(2).
2
In high/low arbitration, the parties agree on the minimum and maximum amounts that are
recoverable in the binding arbitration. See Alan S. Gutterman, Business Transactions Solutions
§ 101:21 (Apr. 2015).
MR. MUELLER: The settlement, let me just go through some of the
parameters of what we’ve discussed before. Obviously we’re all aware of
the dire financial condition of the City of Detroit.
MR. MACK: Yes.
MR. MUELLER: As are you?
MR. MACK: Yes.
*
*
*
MR. MUELLER: You have agreed to a binding arbitration agreement and
I’ll run through these parameters with you and make sure that we are all
on the same page, okay?
MR. MACK: Sure.
MR. MUELLER: It would be binding arbitration subject to City Council
and emergency manager approval. You understand?
MR. MACK: Yes.
*
*
*
MR. MUELLER: . . . Mr. Mack, you understand that by, by entering into
this agreement for binding arbitration, you’re taking the case out of the
court system and waiving your right to go to a jury trial?
MR. MACK: Umm, yes.
MR. MUELLER: You understand we could still proceed to trial, but then
we’d have all those considerations that we had talked about if we receive a
verdict, the potential of appeal and a time issue with respect to potential
bankruptcy by the City. You understood that and that’s why you’re
entering into this arbitration arrangement?
MR. MACK: Yes.
*
*
*
MR. DeJONGH: . . . Mr. Mack, I just want to make it abundantly clear
that this is a final settlement in resolution of your case in its entirety; that
if you leave this courtroom today and reconsider, for all intents and
purposes this is a final settlement. Do you understand that?
2
MR. MACK: Yes.
*
*
*
THE COURT: All right. So Mr. Mack, you’re in agreement then with
this manner of resolving your lawsuit by going into the arbitration with the
high and the low figures that the attorneys mentioned on the record?
You’re okay with that?
MR. MACK: Yes, sir.
Id. Before the Detroit City Council and the Emergency Manager approved the settlement,
however, the City of Detroit filed for bankruptcy. The Court stayed the case while bankruptcy
proceedings were ongoing. See 7/31/2013 Order (Dkt. 33).
Following the City of Detroit’s emergence from bankruptcy, Defendants filed a motion to
enforce the settlement (Dkt. 38). Defendants asserted that the agreement had been submitted to
the Detroit City Council on March 3, 2015 for approval, and that the City Council approved the
agreement on March 24, 2015.
See Defs. Mot. at 4-5.
Defendants also argued that the
requirement of the Emergency Manager’s approval had been rendered moot, because the
Emergency Manager had resigned and “the authority remanded to the executive and legislative
branches of local government in the City of Detroit.” Id. Defendants further noted that Plaintiff
had not dismissed the City of Detroit from the lawsuit, that the bankruptcy proceedings did not
remove the City of Detroit from the lawsuit, and that the City of Detroit remained obligated to
represent and indemnify the individual-officer Defendants per the Detroit City Council’s
approval on October 30, 2012. Id. at 5. Accordingly, Defendants requested that the Court
enforce the agreement, and require binding arbitration. Id.
Plaintiff filed a two-paragraph conclusory response that contained no citation to case law.
The entirety of Plaintiff’s response is set forth below:
3
On July 8, 2013, the parties in this lawsuit agreed, in open court, to
place the case into binding arbitration, with certain “high/low”
parameters. Ten days later, the City of Detroit filed the largest
municipal bankruptcy filing in the history of the United States.
Now, after the City was ruled to be protected from direct
obligation to the Plaintiff by virtue of bankruptcy protection, the
remaining individual Defendants seek to enforce the original
agreement.
The Court should not enforce the original agreement
because the City of Detroit, a party to the original agreement, is no
longer a party in the case. The settlement agreement was reached
between Plaintiff and the City of Detroit, as well as the individual
Defendants. Since the City of Detroit is no longer directly
obligated to Plaintiff, by virtue of its bankruptcy protection, the
contract to place the case into binding arbitration should be ruled
unenforceable.
Pl. Am. Resp. at 1 (Dkt. 42).
Plaintiff — represented by counsel — has cited no authority in support of his conclusory
argument that the filing of bankruptcy by one party to an agreement should render that
agreement unenforceable in its entirety. Nor has he identified any prejudice resulting from the
Court’s enforcement of the agreement. It is not the Court’s function to find authority in support
of a party’s position or argument. This alone is grounds for rejecting Plaintiff’s argument. See
McPherson v. Kelsey, 125 F.3d 989, 995-996 (6th Cir. 1997) (“[I]ssues adverted to in a
perfunctory manner, unaccompanied by some effort at developed argumentation, are deemed
waived. It is not sufficient for a party to mention a possible argument in the most skeletal way,
leaving the court to . . . put flesh on its bones.”); Wholesale Petroleum Partners, L.P. v. S. Cent.
Bank of Daviess Cnty., Inc., 565 F. App’x 361, 366 (6th Cir. 2014) (declining to address an
issue, because the party “offer[ed] no citations to any legal authority in support of its position”);
Hensley v. Gassman, 693 F.3d 681, 687 n.6 (6th Cir. 2012) (same); Bishop v. Gosiger, Inc., 692
4
F. Supp. 2d 762, 774 (E.D. Mich. 2010) (deeming an argument abandoned due to the party’s
failure “to develop it with any discussion of facts or citation of authority”).
Furthermore, in general, settlement agreements are “final and cannot be modified.” See
Smith v. Smith, 823 N.W.2d 114 (Mich. Ct. App. 2011). These agreements will not be set aside
absent fraud, mutual mistake, or duress. Streeter v. Mich. Consol. Gas Co., 65 N.W.2d 760, 764
(Mich. 1954); see also Clark v. Progressive Ins. Co., No. 319454, -- N.W.2d --, 2015 WL
966035, at *3-4 (Mich. Ct. App. Mar. 5, 2015). But Plaintiff does not claim fraud, mutual
mistake, or duress. Indeed, the record clearly reflects that he understood and contemplated the
City of Detroit’s tenuous financial position when entering into the agreement, including the
possibility of bankruptcy by the City.
Plaintiff cannot now claim that the fact that the
bankruptcy came to fruition is a grounds for invalidating the agreement. Nor is the Court aware
of any authority stating that the bankruptcy of one party to an agreement necessarily renders that
agreement unenforceable as to the remaining parties. Cf. Harkless v. Husted, 06-cv-02284, 2011
WL 2149179, at *26 (N.D. Ohio Mar. 31, 2011) (concluding that a settlement agreement was
still enforceable, despite one plaintiff filing for bankruptcy).3
Accordingly, the Court grants Defendants’ motion to enforce the settlement (Dkt. 38).
Plaintiff is bound by his agreement to participate in binding high/low arbitration, given the City
3
Notably, Defendants dispute Plaintiff’s assertion that the City of Detroit is no longer a party to
the case in light of the bankruptcy. Defendants claim that the Chapter 9 Plan of Adjustment
simply “determined that the monetary liability of solely the City of Detroit would be subject” to
the Plan. Moreover, Defendants highlight that any award against the co-Defendant individual
officers will be paid by the City of Detroit outside of the bankruptcy, in light of the City’s
agreed-upon responsibility for defending and indemnifying these parties. Defs. Reply at 2-3
(Dkt. 43).
5
Council’s recent approval of the agreement.4 The Court, therefore, dismisses this case without
prejudice, as discussed by the parties on the record during the settlement conference. See
7/8/2013 Hr’g Tr. at 22 of 28 (cm/ecf page). The case will be subject to reopening for entry of a
judgment and conversion of the dismissal to one with prejudice. Id.
In light of the Court’s decision and dismissal of the case without prejudice, the Court also
denies as moot Plaintiff’s motion to compel the production of documents pertaining to the police
review board hearings (Dkt. 39). This motion was filed after the arbitration agreement in this
case was effectuated. Plaintiff did not seek to compel this discovery before entering into the
agreement, nor did he claim that the Court — as opposed to the arbitrators — needed to resolve
this discovery dispute. Accordingly, the Court denies the motion without prejudice to Plaintiff
raising this issue with the selected arbitrators.
SO ORDERED.
Dated: June 10, 2015
Detroit, Michigan
s/Mark A. Goldsmith
MARK A. GOLDSMITH
United States District Judge
CERTIFICATE OF SERVICE
The undersigned certifies that the foregoing document was served upon counsel of record and any
unrepresented parties via the Court's ECF System to their respective email or First Class U.S. mail
addresses disclosed on the Notice of Electronic Filing on June 10, 2015.
s/Carrie Haddon
Case Manager
4
Plaintiff does not dispute Defendants’ assertion that the requirement that the Emergency
Manager also grant approval has been rendered moot.
6
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