Chidester-Roesch, Jennifer v. Camp Douglas Farmers Cooperative et al
Filing
53
ORDER granting in part and denying in part 26 Motion to JOIN PLAINTIFFS JEFFREY AND NICOLE CHIDESTER'S (CASE NO.: 13-cv-520) MOTION TO STRIKE AFFIRMATIVE DEFENSES OF DEFENDANTS CAMP DOUGLAS FARMERS COOPERATIVE & TRIANGLE INSURANCE COMPANY Signed by District Judge Barbara B. Crabb on 12/9/2013. (voc)
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
JEFFREY CHIDESTER and NICHOLE
CHIDESTER, Individually and as Parents and
Next Friends of SYDNEY CHIDESTER, a Minor,
Plaintiffs,
v.
OPINION AND ORDER
13-cv-520-bbc
CAMP DOUGLAS FARMERS COOPERATIVE,
TRIANGLE INSURANCE COMPANY, INC.
and HEALTH CARE SERVICE CORPORATION
ILLINOIS STATE PAC, NFP, d/b/a BLUE
CROSS BLUE SHIELD OF ILLINOIS.
Defendants.
v.
CHS, INC. and ZURN PEX, INC.,
Third-Party Defendants.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -JENNIFER D. CHIDESTER-ROESCH,
individually and as independent executor
of the ESTATE OF DENNIS J. CHIDESTER
and the ESTATE OF CAROLYN CHIDESTER,
OPINION AND ORDER
Plaintiffs,
13-cv-521-bbc
v.
CAMP DOUGLAS FARMERS COOPERATIVE,
TRIANGLE INSURANCE COMPANY, INC.
and UNITED HEALTHCARE SERVICES, INC.,
Defendants,
v.
C.H.S., INC. and ZURN PEX, INC.,
Third Party Defendants.
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Several matters are before the court in these related negligence cases. First, plaintiffs
have responded in both cases to the court’s order to show that subject matter jurisdiction is
present. Second, plaintiffs in case no. 13-cv-520-bbc have filed a motion for leave to amend
their complaint to substitute Chicago Regional Council of Carpenters Health and Welfare
Fund for Health Care Service Corporation Illinois d/b/a Blue Cross Blue Shield of Illinois.
Third, plaintiffs in both cases have moved to strike various affirmative defenses that
defendants asserted in their answers.
With respect to subject matter jurisdiction in case no. 13-cv-520-bbc, plaintiffs have
alleged that each of them is a citizen of Illinois, defendant Triangle Insurance Company is
a citizen of Oklahoma and defendant Camp Douglas Farm Cooperative is a citizen of
Wisconsin, so diversity of citizenship is present among plaintiffs and these defendants for
the purpose of jurisdiction under 28 U.S.C. § 1332. Plaintiffs allege that proposed new
defendant Chicago Regional Council of Carpenters Health and Welfare Fund is a citizen of
Illinois. Although plaintiffs are citizens of Illinois as well, I agree with plaintiffs that, as a
subrogated insurer, the fund’s interests are aligned with plaintiffs’, so it should be realigned
as a plaintiff for the purpose of § 1332. Accordingly, I will grant plaintiffs’ motion for leave
to amend their complaint with the condition that plaintiffs move to realign the fund as a
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plaintiff promptly after service.
With respect to subject matter jurisdiction in case no. 13-cv-521-bbc, plaintiffs allege
that Jennifer Chidester-Roach is a citizen of Illinois, Carolyn Chidester and Dennis
Chidester were citizens of Illinois at the time they died, defendant Triangle Insurance is a
citizen of Oklahoma, defendant Camp Douglas Cooperative is a citizen of Wisconsin and
defendant United Healthcare Services, Inc. is a citizen of Minnesota. Although United
Healthcare’s citizenship is diverse from all the other parties, I will grant plaintiffs’ request
in their response to realign United Healthcare as a plaintiff.
Although I conclude that plaintiffs’ allegations of diversity are sufficient at this stage
of the case, defendants remain free in the context of a motion for summary judgment to
challenge the way in which plaintiffs have characterized the citizenship of any party.
Further, although most of the evidence plaintiffs’ cite to show the parties’ citizenship seems
to satisfy the Federal Rules of Evidence, there is one exception. In case no. 13-cv-520-bbc,
plaintiffs acknowledge that the citizenship of the fund is determined by the domicile of each
of its trustees. Grede v. Bank of New York Mellon, 598 F.3d 899, 901 (7th Cir. 2010).
However, the only support that plaintiffs provide for the proposition that each trustee is
domiciled in Illinois is a conclusory affidavit from the fund’s administrator, dkt. #49, who
does not provide any foundation for her belief about the domicile of the trustees. In a
footnote, plaintiffs suggest that the fund’s citizenship is irrelevant because the fund is
properly aligned as a plaintiff, dkt #46 at 3 n.3, but that is mistaken. If the fund is aligned
as a plaintiff, it means that the fund’s citizenship need not be diverse from the plaintiffs’
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citizenship, but it is still necessary to determine whether its citizenship is diverse from
defendants’ citizenship. Thus, before this court can issue a decision on the merits in this
case, plaintiffs will have to come forward with more specific evidence regarding the fund’s
citizenship. However, because the case is only at the pleading stage, I may accept plaintiffs’
allegations of diversity of citizenship as true for now. United Transportation Union v.
Gateway Western Railway Co., 78 F.3d 1208, 1210 (7th Cir. 1996) (at pleading stage, court
must accept “well-pleaded factual allegations as true and draw reasonable inferences from
those allegations in the plaintiff's favor”).
This leaves plaintiffs’ motion under Fed. R. Civ. P. 12(f) to strike the affirmative
defenses that defendants Camp Douglas and Triangle Insurance raised in both 13-cv-520-bbc
and 13-cv-521-bbc.
First, plaintiffs argue that the following issues are not properly
characterized as affirmative defenses:
•
defendants’ denial that they are “liable to Plaintiff under any theory of
law and/or facts as set forth in Plaintiff’s Complaint”;
•
defendants’ denial that any negligence by them “was not the direct and
proximate cause or causally related to any injury alleged by Plaintiff”;
•
“Plaintiff’s Complaint fails to state claims upon which relief can be
granted, and thus, should be dismissed pursuant to Federal Rule of
Civil Procedure 12(b)(6)”;
•
“Plaintiff’s claims are barred because [defendants] complied with all
applicable statutes, codes and regulations”;
•
“No action or inaction by [defendants] was the proximate cause of the
plaintiff’s damages, if any”;
•
defendants’ denial that “Plaintiff is entitled to punitive damages,
interest, attorney’s fees, costs or any other expenses or damages from”
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defendants;
•
“Plaintiff failed to join necessary parties.”
I agree with plaintiffs that these allegations are denials of the elements of plaintiffs’
claims rather than affirmative defenses, but I see no reason to strike them. Plaintiffs do not
identify any prejudice that they will suffer as a consequence of allowing defendants to allege
affirmatively that they believe that plaintiffs cannot prove their claims.
With respect to the remaining issues that defendants raise as affirmative defenses,
plaintiffs argue that defendants have failed to allege enough facts under Fed. R. Civ. P. 8 to
give plaintiffs notice of the defense. These defenses are laches, waiver, estoppel, contributory
negligence, unclean hands, assumption of risk, failure to mitigate damages, open and obvious
dangers, unjust enrichment, statute of limitations, real party in interest, personal
jurisdiction, venue, failure to comply with conditions precedent to suit, damage caps and
“any or all affirmative defenses contemplated by Wisconsin law.” In response, defendants
do not deny that they failed to include facts supporting their defenses, but they argue that
the federal rules do not require them to include those facts.
The parties cite dueling district court decisions on the question whether the
plausibility requirement for complaints articulated in Ashcroft v. Iqbal, 556 U.S. 662
(2009), and Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007), apply to affirmative
defenses. Compare FDIC v. Vann, 11 C 3491, 2013 WL 704478 (N.D. Ill. Jan. 23, 2013)
(applying plausibility standard to affirmative defenses); Massenberg v. A & R Security
Services, Inc., 10 C 7187, 2011 WL 2909364 (N.D. Ill. July 18, 2011) (same) with
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Chiancone v. City of Akron, 5:11CV337, 2011 WL 4436587 (N.D. Ohio Sept. 23, 2011)
(declining to apply Twombly and Iqbal to affirmative defenses); Leon v. Jacobson
Transportation Co., Inc., 10 C 4939, 2010 WL 4810600 (N.D. Ill. Nov. 19, 2010) (same).
The Court of Appeals for the Seventh Circuit has not addressed this issue.
In support of their view, defendants argue that the pleading of affirmative defenses
is governed by Fed. R. Civ. P. 8(b) while claims are governed Fed. R. Civ. P. 8(a). Unlike
Rule 8(a), Rule 8(b) does not include a requirement that the pleading “sho[w] that the
pleader is entitled to relief.” Rather, the only requirement is to “state in short and plain
terms its defenses to each claim asserted against it.” Fed. R. Civ. P. 8(b)(1)(A). In addition,
defendants say that because affirmative defenses cannot be used to extract a settlement and
do not expose a plaintiff to expensive discovery to the same extent that claims do, it is less
important to insure that defenses have factual support at the outset. Finally, defendants say
that requiring them to plead facts in support of their affirmative defenses would prevent
them from raising the defenses with their answer in many cases.
Defendants make a persuasive case in support of a view that the requirements for
pleading affirmative defenses are not as rigorous as pleading claims. However, a conclusion
that the standards are less rigorous is not the same as a conclusion that a defendant need not
plead any facts in support of a defense. In Heller Financial, Inc. v. Midwhey Powder Co.,
Inc., 883 F.2d 1286, 1295 (7th Cir. 1989), the court affirmed a decision to grant a motion
to strike affirmative defenses that were “nothing but bare bones conclusory allegations” and
that “omitted any short and plain statement of facts.” Heller is the only case that either side
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cites in which the Court of Appeals for the Seventh Circuit considered the sufficiency of an
affirmative defense and neither side cites any authority undermining Heller. This is a
problem for defendants because they make no attempt to show that their affirmative
defenses are anything other than “bare bones conclusory allegations.”
There is some force to an argument that requiring parties to plead facts with their
affirmative defenses makes it difficult for them to plead defenses before discovery. However,
the alternative rule suggested by defendants would allow parties simply to bombard their
opponent with a laundry list of affirmative defenses without making any individualized
inquiry into whether a particular defense actually applies to the facts of the case. Under that
system, it is not clear how the affirmative defense provides any helpful notice to the other
side. Rather, it seems to serve no purpose except to reserve the defendant’s rights to the
maximum extent possible.
Further, by asking the court for permission to plead a defense before having any idea
whether it applies, defendants in essence are asking the court for permission to violate Fed.
R. Civ. P. 11, which requires a party to conduct “an inquiry reasonable under the
circumstances” before asserting any claim or defense to a court and to determine whether
any “factual contentions have evidentiary support or, if specifically so identified, will likely
have evidentiary support after a reasonable opportunity for further investigation or
discovery.” Fed. R. Civ. P. 11(b). Rule 11 applies to any document filed with the court, not
just complaints. Thus, regardless whether Twombly and Iqbal apply to affirmative defenses,
Rule 11 prohibits a party from listing an affirmative defense without any factual basis for
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doing so.
Accordingly, I am granting plaintiffs’ motion to strike the affirmative defenses of
laches, waiver, estoppel, contributory negligence, unclean hands, assumption of risk, failure
to mitigate damages, open and obvious dangers, unjust enrichment, statute of limitations,
real party in interest, personal jurisdiction, venue, failure to comply with conditions
precedent to suit, damage caps and “any or all affirmative defenses contemplated by
Wisconsin law.” Of course, defendants are free to file a timely amendment to their answers
to reassert any of the stricken affirmative defenses once they have factual support.
ORDER
IT IS ORDERED that
1. The motion filed by plaintiffs Jeffrey Chidester, Nicole Chidester and Sydney
Chidester in case no. 13-cv-520-bbc for leave to amend their complaint to substitute Chicago
Regional Council of Carpenters Health and Welfare Fund for Health Care Service
Corporation Illinois d/b/a Blue Cross Blue Shield of Illinois, dkt. #36, is GRANTED.
2. Plaintiffs may have until January 10, 2014, to file and serve their amended
complaint on Chicago Regional Council of Carpenters Health and Welfare Fund and move
to realign the fund as a plaintiff.
3. Defendant United Healthcare Services, Inc. is REALIGNED as a plaintiff in case
no. 13-cv-521-bbc.
4. Plaintiffs’ motions to strike the affirmative defenses asserted by defendants Camp
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Douglas Farmers Cooperative and Triangle Insurance Company in case no. 13-cv-520-bbc,
dkt. #19, and case no. 13-cv-521-bbc, dkt. #26, are GRANTED with respect to the
following affirmative defenses: laches, waiver, estoppel, contributory negligence, unclean
hands, assumption of risk, failure to mitigate damages, open and obvious dangers, unjust
enrichment, statute of limitations, real party in interest, personal jurisdiction, venue, failure
to comply with conditions precedent to suit, damage caps and “any or all affirmative
defenses contemplated by Wisconsin law.” These affirmative defenses are STRICKEN
without prejudice to defendants’ refiling a timely amended answer once it is determined
whether the defenses have factual support. The motion is DENIED in all other respects.
Entered this 9th day of December, 2013.
BY THE COURT:
/s/
BARBARA B. CRABB
District Judge
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