IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF INDIANA

HAMMOND DIVISION

ROBERT HOLLAND )

)

Plaintiff, )

)

vs. ) No. 2:13-cv-00491

)

CERBERUS CAPITAL MANAGEMENT, )

et al., )

)

Defendants. )

OPINION AND ORDER

This matter is before the Court on the: (1) Defendants’

Cerberus Capital Management, LP, Stephen Feinberg, and Robert

Nardelli’s Motion to Dismiss Plaintiff’s Verified Complaint

Pursuant to Fed. R. Civ. P. 12(b)(6) and (b)(2), filed by

Defendants, Cerberus Capital Management, LP, Stephen Feinberg, and

Robert Nardelli, on June 17, 2014 (DE #28); (2) Motion for Oral

Argument on Cerberus Defendants’ Motion to Dismiss Plaintiff’s

Verified Complaint Pursuant to Fed. R. Civ. P. 12(B)(6) and (B)(2),

filed by Cerberus Capital Management, LP, Robert Nardelli, and

Stephen Feinberg, on July 23, 2014 (DE #65); (3) Defendants, Bosak

Motors Auto Dealership, et al.’s Motion to Dismiss, filed by

Defendants, Bosak Motors Auto Dealership, Mr. & Mrs. Skip Bosak,

John Schultheis, Jonathan Jeffries, and Mike Grzbowski, on July 14,

2014 (DE #57); (4) Defendants’ Motion to Dismiss, filed by

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Defendants, Kimberly Johnson and TD Auto Finance LLC, Successor in

interest to Chrysler Financial LLC, on July 24, 2014 (DE #69); (5)

Defendants’ Motion to Dismiss, filed by Defendants, Kimberly

Johnson and TD Auto Finance LLC, Successor in interest to Chrysler

Financial LLC, on July 24, 2014 (DE #70); (6) “Request for Default

Judgment Sum Certain by the Clerk of the Court,” filed by

Plaintiff, Robert Holland, on July 29, 2014 (DE #71); (7) “Request

for Clerk’s Entry of Default Judgment,” filed by Plaintiff, Robert

Holland, on June 19, 2014 (DE #37); (8) “Application for Judgment

by Default Sum Certain,” filed by Plaintiff, Robert Holland, on

November 10, 2014 (DE #99); (9) “Request for the Court to Issue an

Order for the Defendants to Remove Damaging Credit Information From

the Credit Reporting Agencies,” filed by Plaintiff, Robert Holland,

on November 10, 2014 (DE #100); and (10) “Brief on Treble Damages

Pursuant to State Law,” filed by Plaintiff, Robert Holland, on

November 10, 2014 (DE #101). 

For the reasons set forth below: (1) Defendants’ Cerberus

Capital Management, LP, Stephen Feinberg, and Robert Nardelli’s

Motion to Dismiss Plaintiff’s Verified Complaint Pursuant to Fed.

R. Civ. P. 12(b)(6) and (b)(2) (DE #28), is GRANTED. The Clerk is

ORDERED to DISMISS the federal claims against these defendants,

Cerberus Capital Management, LP, Stephen Feinberg, and Robert

Nardelli, WITH PREJUDICE and the state claims are DISMISSED WITHOUT

PREJUDICE. (2) The Motion for Oral Argument on Cerberus Defendants’

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Motion to Dismiss Plaintiff’s Verified Complaint Pursuant to Fed.

R. Civ. P. 12(B)(6) and (B)(2) (DE #65) is DENIED. (3) Defendants,

Bosak Motors Auto Dealership, et al.’s Motion to Dismiss (DE #57)

is GRANTED. The Clerk is ORDERED to DISMISS the federal claims

against these defendants, Bosak Motors Auto Dealership, Mr. and

Mrs. Skip Bosak, John Schultheis, Jonathan Jeffries, and Mike

Grzbowski WITH PREJUDICE and the state claims are DISMISSED WITHOUT

PREJUDICE. (4) Defendants’ Motion to Dismiss (DE #69) is GRANTED. 

The Clerk is ORDERED to DISMISS the federal claims against these

Defendants, Kimberly Johnson and TD Auto Finance LLC, Successor in

interest to Chrysler Financial LLC, WITH PREJUDICE and the state

claims are DISMISSED WITHOUT PREJUDICE. (5) Defendants’ Motion to

Dismiss (DE #70), is duplicative and therefore DENIED AS MOOT; (6)

The “Request for Default Judgment Sum Certain by the Clerk of the

Court,” (DE #71), is DENIED. (7) The “Request for Clerk’s Entry of

Default Judgment,” (DE #37), is DENIED. The Clerk is ALSO ORDERED

to DISMISS the federal claims against these defendants, Paul Davis,

Bull Dog Towing, and the CEO of Bull Dog Towing, WITH PREJUDICE and

DISMISS the state claims WITHOUT PREJUDICE. (8) The “Application

for Judgment by Default Sum Certain” (DE #99), is DENIED. (9) The

“Request for the Court to Issue an Order for the Defendants to

Remove Damaging Credit Information From the Credit Reporting

Agencies,” (DE #100), is DENIED. (10) The relief requested in the

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“Brief on Treble Damages Pursuant to State Law,” (DE #101), is

DENIED. Finally, the Clerk is ORDERED to CLOSE THIS CASE. 

BACKGROUND

Pro se Plaintiff, Robert Holland, filed his complaint against

multiple defendants on December 30, 2013 (DE #1). In his difficult

to read and rambling 35- page complaint, he sets forth several

different allegations of the Racketeer Influenced and Corrupt

Organizations Act (“RICO”) violations. Holland is no stranger to

the Court and has been accused by this Court before of filing cases

that are “fantastic,” “delusional,” and “malicious.” See, e.g.,

Holland v. City of Gary, No. 2:12-CV-62-TS, 2012 WL 974882, at *3

(N.D. Ind. Mar. 21, 2012). 

In a nutshell, the allegations of the complaint are as

follows. In October 2007, Holland purchased a 2006 Chrysler 300

plus an extended warranty from Defendant, Bosak Motors in

Merrillville, Indiana, and obtained financing for the purchase

through Defendant, Chrysler Financial, LLC. (Compl. ¶¶ 53, 61.) 

Holland alleges he relied on “express representations and

warranties” made by Defendant, Mike Grzbowski (a Bosak salesman)

about the financial condition of Chrysler and the dependability of

the Chrysler 300 and that it did not have any problems and/or major

manufacturing defects. (Id. ¶¶ 54-55, 61.) Plaintiff alleges

that Bosak knew at the time of sale that the vehicle “had numerous

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repeated mechanical problems under normal driving conditions . . .

.” (Id. ¶ 62.)

Holland claims on February 27, 2009, his Chrysler 300 was

towed to Bosak for repair to its ignition switch, and after Bosak’s

repair department was unable to secure a new ignition switch part

after the car had been in the shop for a month, one was retrieved

from the junk yard and used to fix his car on March 27, 2009. (Id.

¶¶ 81, 105-06.) Plaintiff alleges he was “not compensated for the

manufacturing problems and had to pay for the repairs.” (Id. ¶

113.) He also alleges that on July 3, 2010, Chrysler Financial

directed that his Chrysler 300 be repossessed by Defendant, Bull

Dog Towing, despite Plaintiff’s claim that he made his monthly car

payment the day before his car was towed. (Id. ¶¶ 125, 129.) 

Finally, he alleges the Chrysler 300 was sold at auction without

compensation to him. (Id. ¶¶ 146-47.) These facts basically

comprise Plaintiff’s claim that he financed the purchase of a car,

the car had mechanical problems, and it was repossessed for

nonpayment despite the fact that he allegedly made payment the day

before his car was towed. (Id. ¶¶ 61, 78, 131.)

Plaintiff’s theory of recovery is much more convoluted. To

support his RICO claims, Plaintiff has alleged that in May 2007,

Cerberus acquired a majority stake in Chrysler, an investment he

conclusorily asserts was made to “establish . . . illegal

fraudulent strong arm policies and practices with [Chrysler’s]

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customers, dealers and suppliers, etc. in order to increase cash

flows and reduce expenses.” (Id. ¶¶ 28, 31.) Plaintiff also

alleges that the $7.4 billion acquisition was not for any

legitimate business purpose, but “to establish and/or maintain[] an

entirely new business with new aggressive illegal operational

policies and procedures” and that Cerberus “used the Chrysler and

Chrysler Financial Enterprises (and their appearance of legitimacy

to perpetrate more, and less easily discovered, criminal acts than

it could do on it[s] own) to obtain money, property and other

assets generated by a pattern of racketeering activity.” (Id. ¶¶

37-38.) 

Holland also alleges that after it acquired Chrysler,

Cerberus, along with all the other Defendants, comprised an

unlawful association-in-fact and “seized influence and/or control

of Chrysler and Chrysler Financial Assets and utilized the

companies as a criminal enterprise to further its criminal

objectives.” (Id. ¶ 42.) In furtherance of the supposed scheme,

Plaintiff suggests that Defendant Stephen Feinberg, the CEO of

Cerberus, installed Defendant Robert Nardelli “to head Chrysler .

. . and implement Cerberus’ new policies and practices” and that

those policies and practices led to “considerable pressure from

Chrysler and Chrysler Financial CEO Robert Nardelli through . . .

Cerberus to increase performance through its illegal collections

activities, cost reductions, through directives to its dealerships

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to help increase revenues, decrease expenses (and costs) and

efforts to obtain favorable financing for operations.” (Id. ¶¶ 44,

50.)

Supposedly acting in concert, Plaintiff claims Defendants

committed the following alleged predicate acts of racketeering

activity giving his to his RICO claims: (1) making “materially

false deceptive misrepresentations” to induce Plaintiff to buy a

car (id. ¶ 52); (2) holding his car hostage, in bad faith, for a

month to make repairs to his ignition switch (id. ¶¶ 68, 106-07);

(3) committing extortionate trespass, wrongful repossession and

theft/conversion by repossessing the car despite Plaintiff’s

assurances he was not delinquent in his payment (id. ¶¶ 119, 132);

and (4) unlawful collection of a debt, defamation and damage to

credit resulting from the repossession (id. ¶ 155). Plaintiff

further asserts Defendants participated in a wide-ranging

conspiracy because they “were NOT acting in the course and scope of

their employment in the traditional rendering of their services but

were acting in concert committing predicate acts of racketeering

that all occurred in a related concerted fashion in connection to

the Chrysler 300, its repairs and warranties.” Id. ¶ 179 (emphasis

in original).

The instant motions to dismiss were filed by Defendants,

Cerberus Capital Management, LP, Stephen Feinberg, and Robert

Nardelli (hereinafter “Cerberus Defendants”) (DE #28) pursuant to

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Federal Rule of Civil Procedure 12(b)(6) and (b)(2)1; Defendants,

Bosak Motors Auto Dealership, Mr. and Mrs. Skip Bosak, John

Schultheis, Jonathan Jeffries, and Mike Grzbowski (hereinafter

“Bosak Defendants”) (DE #57) pursuant to Rule 12(b)(6); and

Defendants, Kimberly Johnson and TD Auto Finance, LLC, Successor in

interest to Chrysler Financial LLC (hereinafter “TDAF”) (DE #69)

pursuant to Rule 12(b)(6).2

 They move to dismiss all the claims

in the complaint: Count I for violation of RICO, 18 U.S.C. §

1962(a) and Indiana Civil Rico; Count II for violation of RICO, 18

U.S.C. § 1962(c) and Indiana Civil RICO; and Count III for

violation of RICO 18 U.S.C. § 1962(d) and Indiana Civil RICO. The

motions to dismiss are fully briefed and ready for adjudication.3

Three parties in this case have not appeared. Defendants,

Paul Davis, “CEO Bull Dog Towing,” and Bull Dog Towing. The Clerk

made an entry of default as to Paul Davis. (DE #60.) 

Additionally, this Court made an entry of default as to the CEO of

1

 The Cerberus Defendants argue that to the extent that a claim based

upon the Indiana RICO might survive, the Court lacks personal jurisdiction

over the Cerberus Defendants, and the Court should dismiss under Rule

12(b)(2). As elucidated later in this Order, the Court finds that Plaintiff

failed to properly state federal RICO claims, thus all the federal claims have

been dismissed prior to trial. It is this Court’s practice to dismiss without

prejudice state supplemental claims whenever all federal claims have been

dismissed. See Groce v. Eli Lilly & Co., 193 F.3d 496, 501 (7th Cir. 1999). 

Thus, the Court need not address this argument under Rule 12(b)(2), and this

case will be analyzed under the 12(b)(6) standard. 

2

Defendants, Kimberly Johnson and TD Auto Finance, LLC, Successor in

interest to Chrysler Financial LLC (“TDAF”) filed another motion to dismiss,

also dated July 24, 2014 (DE #70). It appears to be word for word the same as

the document at DE #69, and is therefore denied as moot.

3 Plaintiff also filed a “Rico Case Statement,” on July 31, 2014 (DE

#78), and this Court has given it the weight to which it is entitled. 

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Bull Dog Towing and Bull Dog Towing on October 8, 2014 (DE #94). 

Plaintiff filed a motion for default judgment as to Defendants, the

CEO of Bull Dog Towing and Bull Dog Towing on June 19, 2014 (DE

#37). He also filed a motion for default judgment against Paul

Davis on July 29, 2014 (DE #71). In support of these motions,

Plaintiff filed a lengthy affidavit with attachments detailing his

alleged damages. (DE #32.) Plaintiff stated he was seeking

$41,833,455 in total punitive damages against the various

defendants. Id. On November 4, 2014, this Court held a hearing

that was set aside for Plaintiff to prove his damages for the

defaulted defendants, at which Plaintiff appeared but Paul Davis,

the CEO of Bull Dog Towing, and Bull Dog Towing did not appear. 

However, the Court informed Plaintiff at this hearing that it

believed the allegations of the complaint were not sufficient to

establish legal claims. Plaintiff then filed another application

for default judgment on November 10, 2014, this time seeking

damages in the amount of $66,123,878.90. (DE #99.)

DISCUSSION

Motion to Dismiss for Failure to State a Claim

Federal Rule of Civil Procedure 12(b)(6) provides for the

dismissal of a complaint, or any portion of a complaint, for

failure to state a claim upon which relief can be granted. “To

survive a motion to dismiss, a complaint must contain sufficient

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factual matter, accepted as true, to state a claim to relief that

is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678

(2009) (internal quotations omitted); see also Ray v. City of

Chicago, 629 F.3d 660, 662-63 (7th Cir. 2011) (citation omitted)

(“While the federal pleading standard is quite forgiving . . . the

complaint must contain sufficient factual matter, accepted as true,

to state a claim to relief that is plausible on its face.”).

A complaint should not be dismissed for failure to state a

claim “unless it appears beyond doubt that the plaintiff can prove

no set of facts in support of his claim which would entitle him to

relief.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 561 (2007)

(quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). Plus, Iqbal

requires that a plaintiff plead content which allows this Court to

draw a reasonable inference that the defendant is liable for the

alleged misconduct. 556 U.S. at 678.

In ruling on a motion to dismiss brought pursuant to Federal

Rule of Civil Procedure 12(b)(6), the court must draw all

reasonable inferences that favor the plaintiff, construe the

allegations of the complaint in the light most favorable to the

plaintiff, and accept as true all well-pleaded facts and

allegations in the complaint. Thompson v. Ill. Dep't of Prof'l

Regulation, 300 F.3d 750, 753 (7th Cir. 2002); Perkins v.

Silverstein, 939 F.2d 463, 466 (7th Cir. 1991). In order to

withstand a motion to dismiss, a complaint must allege the

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“operative facts” upon which each claim is based. Kyle v. Morton

High Sch., 144 F.3d 448, 454-55 (7th Cir. 1998); Lucien v. Preiner,

967 F.2d 1166, 1168 (7th Cir. 1992). A plaintiff is required to

include allegations in the complaint that “plausibly suggest that

the plaintiff has a right to relief, raising that possibility above

a ‘speculative level’ ” and “if they do not, the plaintiff pleads

itself out of court.” E.E.O.C. v. Concentra Health Servs., Inc.,

496 F.3d 773, 776 (7th Cir. 2007) (quoting in part Twombly, 550

U.S. at 569 n. 14 (2007)). “Factual allegations must be enough to

raise a right to relief above the speculative level, on the

assumption that all the allegations in the complaint are true (even

if doubtful in fact).” Twombly, 550 U.S. at 555 (quotation marks,

ellipsis, citations and footnote omitted). Thus, a “plaintiff must

do better than putting a few words on paper that, in the hands of

an imaginative reader, might suggest that something has happened to

her that might be redressed by the law.” Swanson v. Citibank,

N.A., 614 F.3d 400, 403 (7th Cir. 2010) (emphasis in original).

The Court notes that Plaintiff is appearing pro se in this

matter. Generally, although "pro se litigants are masters of their

own complaints," and "[d]istrict judges have no obligation to act

as counsel or paralegal to pro se litigants," Myles v. United

States, 416 F.3d 551, 552 (7th Cir. 2005), a document filed pro se

is to be liberally construed, and a pro se complaint, however

inartfully pleaded, must be held to less stringent standards than

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formal pleadings drafted by lawyers. Erickson v. Pardus, 551 U.S.

89, 94 (2007). However, “on a motion to dismiss, courts are not

bound to accept as true a legal conclusion couched as a factual

allegation.” Twombly, 550 U.S. at 555 (citing Papasan v. Allain,

478 U.S. 265, 286 (1986) (quotation marks omitted)). In this case,

the Court notes that Holland was a former attorney and purports to

have been “an attorney that practices law in the state of Indiana”

“at all material time relevant in [his] complaint.” (Compl. ¶ 6.) 

According to the Seventh Circuit, “[a]s a former attorney,

[Holland] has only the most tenuous claim to the more forgiving

pleading standards we afford typical pro se plaintiffs.”). Weston

v. Illinois Dep’t Of Human Services, 433 Fed. Appx. 480, 482 n.1

(7th Cir. 2011). No matter what, even a liberal construction of

the complaint is not “an invitation to apply RICO to new purposes

that Congress never intended.” Reves v. Ernst & Young, 507 U.S.

170, 183 (1993).

This Court recently noted that “RICO was never intended to

turn garden-variety state law fraud claims into federal RICO

actions.” Evan v. JP Morgan Chase Credit Cards, No. 2:10-CV-246,

2011 WL 2946134, at *3 (N.D. Ind. July 21, 2011) (citing Jennings

v. Auto Meter Prods., Inc., 495 F.3d 466, 472 (7th Cir. 2007)). 

Yet, Defendants argue that Plaintiff has done exactly that. 

Plaintiff Fails To State a Claim Under 1962(c) Because There 

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 12 of 31
Are No Adequately Pled Predicate Acts of Racketeering 

Activity

It appears from the complaint that Plaintiff has charged all

Defendants in Count II with violations of 18 U.S.C. § 1962(c),

which makes it “unlawful for any person employed by or associated

with any enterprise engaged in, or the activities of which affect,

interstate or foreign commerce, to conduct or participate, directly

or indirectly, in the conduct of such enterprise’s affairs through

a pattern of racketeering activity or collection of unlawful debt.” 

18 U.S.C. § 1962(c). The necessary elements of a RICO claim under

section 1962(c) are: “(1) conduct (2) of an enterprise (3) through

a pattern (4) of racketeering activity.” Vicom, Inc. v. Harbridge

Merchant Servs., Inc., 20 F.3d 771, 778 (7th Cir. 1994) (quotation

omitted); see also Crissen v. Gupta, No. 2:12-CV-00355, 2014 WL

301615, at *6 (S.D. Ind. Jan. 28, 2014) (reciting same elements). 

Additionally, a plaintiff must allege and prove the existence of

two distinct entities: (1) a person; and (2) an enterprise. Cedric

Kushner Promotions, Ltd. v. King, 533 U.S. 158, 161 (2001).

First, Defendants argue that this count must be dismissed due

to Plaintiffs' failure to adequately plead acts of mail fraud or

any predicate acts of racketeering activity.4 Not every alleged

4 The Court pauses to note that the three counts of action are contained

in 2 pages of the 35-page complaint. (Compl., pp. 33-34.) Plaintiff merely

recites the statutory language of RICO, and incorporates hundreds of earlier

paragraphs of the complaint (for example, paragraphs 1 - 190 are incorporated

in Count II) (Compl. ¶ 191). This is simply insufficient under Rule 8(a)(2)

and Rule 9(b)’s requirement of particularity regarding fraud. See, e.g.,

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bad act constitutes racketeering activity under RICO - the federal

RICO statute enumerates an exclusive list of specific offenses that

qualify as predicate acts of “racketeering activity” for purposes

of RICO liability. See 18 U.S.C. § 1961(1); McDonald v. Schencker,

18 F.3d 491, 495 (7th Cir. 1994) (affirming dismissal of RICO claim

where plaintiff failed to plead a racketeering activity under

Section 1961(1)). 

Regarding the Cerberus Defendants, Plaintiff has failed to

plead that any of them committed even a single predicate act of

racketeering activity themselves, thus they cannot be liable as

RICO defendants. (Pls.’ Mem., pp. 8-12.) See Pringle v. Garcia,

No. 2:09-cv-022-PPS-PRC, 2014 WL 1651976, at *4 (N.D. Ind. Apr. 23,

2014) (dismissing RICO claim where plaintiff failed to plead that

defendant personally committed requisite predicate acts). 

In response, Plaintiff merely states that his predicate acts

were “clearly stated in the Complaint. . . and included mail fraud,

wire fraud, bank fraud, extortion, intimidation, unlawful

collection of debt, harassment, fraud, conversion, etc.” and

contends “Indiana Civil RICO requir[es] less stringent claims.” 

Arnold v. Alphatec Spine, Inc., No. 1:13-cv-714, 2014 WL 2896838, at *11 n.15

(S.D. Ohio June 26, 2014) (“incorporation into a single claim of approximately

100 incoherently pled paragraphs wholly fails to provide ‘a short and plain

statement of the claim;’” citing Fed. R. Civ. P. 8(a)(2)); Sterling Nat’l

Mortg., Co., Inc. v. Infinite Title Solutions, LLC, No. 10-22147, 2011 WL

1303225, at *5 (S.D. Fla. Mar. 4, 2011) (“even if [the Court] were able to

find the makings of a conspiracy somewhere within the 217 paragraphs

[plaintiff] incorporates by reference in [the RICO conspiracy count], it would

be insufficient to satisfy [plaintiff’s] obligations under Rule 9(b).”).

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(Pl.’s Resp., DE #58, pp. 12-13.) Nevertheless, both federal (and

Indiana Civil) RICO still only include specific listed offenses as

racketeering activity giving rise to predicate acts. See 18 U.S.C.

§ 1961(1); Ind. Code § 35-45-6-1(e). Moreover, Plaintiff’s

allegations of claims sounding in extortion, intimidation, unlawful

collection of a debt, harassment, general fraud, and conversion

against Defendants TDAF are either not in the defined terms under

the statutes, or they are inadequately pled and give no notice for

the basis of the claim. 

The allegations of mail fraud, wire fraud and bank fraud, are

among the enumerated racketeering activities in § 1961(1); however,

they are subject to the heightened pleading standard set forth in

Rule 9(b) of the Federal Rules of Civil Procedure, which requires

a plaintiff to plead all allegations of fraud with particularity.5

See Slaney v. Int’l Amateur Athletic Fed’n, 244 F.3d 580, 597 (7th

Cir. 2001) (“allegations of fraud in a civil RICO complaint are

subject to the heightened pleading standard of Fed. R. Civ. P.

9(b), which requires a plaintiff to plead all averments of fraud

with particularity.”); Emery v. American General Finance, Inc.,71

F.3d 1343, 1348 (7th Cir. 1995) (stating to prevail in a RICO case,

where the acts are of fraud, “the circumstances of each act must be

pleaded with particularity.”). In other words, a plaintiff is

5 The complaint alleges “racketeering activity” of “mail fraud, wire

fraud, and bank fraud.” (Compl. ¶ 174.)

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required to explain how the predicate act of mail fraud, wire

fraud, or bank fraud constitutes "racketeering activity." Williams

v. Aztar Indiana Gaming Corp., 351 F.3d 294, 298 (7th Cir. 2003). 

This is done by explaining how each element of the predicate act is

satisfied. Id. at 299. 

The elements of mail and wire fraud, 18 U.S.C. sections 1341

and 1343, are: "(1) the defendant's participation in a scheme to

defraud; (2) defendant's commission of the act with intent to

defraud; and (3) use of the mails or wire communication in

furtherance of the fraudulent scheme." United States v. Walker, 9

F.3d 1245, 1249 (7th Cir. 1993). In order to satisfy this

standard, a RICO plaintiff must allege “the identity of the person

who made the representation, the time, place and content of the

misrepresentation, and the method by which the misrepresentation

was communicated to the plaintiff." Slaney, 244 F.3d at 599

(citation omitted); Windy City Metal Fabricators & Supply, Inc. v.

CIT Technology Financing Services, Inc., 536 F.3d 663, 668 (7th

Cir. 2008) (reciting the required circumstances of fraud);

Hefferman v. Bass, 467 F.3d 596, 601 (7th Cir. 2006) (also listing

facts that must be alleged in detail). In a case involving

multiple defendants, like this one, "the complaint should inform

each defendant of the nature of his alleged participation of the

fraud." Vicom, 20 F.3d at 778 (quotation omitted).

In response to all the defendants’ arguments that he failed to

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plead mail and wire fraud with the requisite particularity,

Plaintiff argues he met his burden because he “gave his personal

knowledge of the mail and wire fraud” and could not provide more

specifics because “[o]bviously, a person does not keep information

about every person they communicate with.” (Resp., DE #67, p. 11.) 

Even pleading the entirety of one’s personal knowledge may not be

enough. See, e.g., Cox v. Sherman Capital, LLC, No. 1:12-cv-01654-

TWP-KJD, 2014 WL 1328147, at *5 (S.D. Ind. Mar. 31, 2014) (“One of

the purposes of the heightened pleading requirements in Rule 9(b)

is to prevent ‘fishing expeditions,’ so to excuse [a plaintiff’s]

failure to include the requisite information in the Complaint

because [he] lack[s] information that would otherwise be unearthed

in discovery would defeat the purpose behind the rule.”).

This Court finds that Plaintiff has failed to plead the

alleged mail and wire fraud claims with particularity as required

by Rule 9(b). Sweeping generalizations that “mail [and] wire . .

. fraud occurred” (Compl. ¶¶ 65, 116, 174) are insufficient without

identifying exactly which defendant engaged in the alleged fraud. 

See, e.g., Vicom, 20 F.3d at 777-78 (finding allegations that

misrepresentations made “at the direction, under the supervision,

or with the knowledge and consent” of all the defendants not

specific enough); see also Sears v. Likens, 912 F.2d 889, 893 (7th

Cir. 1990) (holding complaint properly dismissed where it “lump[ed]

all the defendants together and [did] not specify who was involved

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in what activity”). There are no specific allegations that any of

the defendants used the mail or wires in connection with this

action (with the exception of Plaintiff’s purported receipt of

“Chrysler Marketing and Advertising materials”) (Compl. ¶ 65), and

Plaintiff failed to specify the date, sender, or content of any

such mailing. Without specifying when he received the mailing, who

sent it, and what statements in the mailing were allegedly false or

fraudulent, such assertions cannot support a mail or wire fraud

claim. Slaney, 244 F.3d at 599-600; see also Catlin v. Hanser, No.

1:10-CV-0451, 2011 WL 1002736, at *5 (S.D. Ind. Mar. 17, 2011)

(finding “conclusory allegations . . . are not enough to plead the

requisite pattern of fraud.”). Plaintiff alleges he spoke to some

individuals on the phone, like Defendant Kimberly Johnson (Compl.

¶¶ 142-43), but again, he has failed to give the requisite detail

about the alleged conversations or show how they contained any

statements that constituted alleged fraudulent representations. 

See Jepsen, Inc. v. Makita Corp., 34 F.3d 1321, 1328 (7th Cir.

1994) (“loose references to mailing and telephone calls in

furtherance of a purported scheme to defraud will not do.”). 

As noted by TDAF, in addition to an adequacy of pleading

problem, Holland also has a standing issue with respect to any

allegation that any of the Defendants committed bank fraud. 18

U.S.C. § 1344 specifically defines bank fraud as defrauding “a

financial institution.” 18 U.S.C. § 1344. Holland has not, and

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cannot, allege that he is a financial institution. See, e.g.,

Whitehead v. Gateway Chevrolet, No. 03 C 5684, 2004 WL 316413, at

*6 (N.D. Ill. Feb. 2, 2004) (only financial institutions have

standing to allege violations of the financial institution fraud

statute as predicate acts for RICO).

Additionally, TDAF is the only Defendant which Plaintiff

alleges conducted money laundering. (Compl. ¶ 152.) The

applicable statute narrowly defines money laundering as a person

who “knowing that the property involved in a financial transaction

represents the proceeds of some form of unlawful activity, conducts

or attempts to conduct such a financial transaction which in fact

involves the proceeds of specified unlawful activity . . . .” 18

U.S.C. § 1956. The statute goes on to define “specified unlawful

activity” to include criminal activities like kidnapping, smuggling

of goods, etc., but does not cover the alleged criminal activity in

this case (money obtained from an auction house after a

repossession sale of a car). Because the facts alleged do not

constitute “specified unlawful activity” under the money laundering

statute, they are not actionable as a predicate act of racketeering

activity. See, e.g., Starfish Inv. Corp. v. Hanson, 370 F.Supp.2d

759, 773-74 (N.D. Ill. 2005) (dismissing RICO count where complaint

failed to allege defendants engaged in activities constituting

“specified unlawful activity” within meaning of the money

laundering statute).

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Plaintiff Also Fails To State A Claim Under 1962(c) Because

There Is No Pattern of Racketeering

Plaintiff has also failed to allege sufficient facts to

demonstrate there was a pattern of racketeering activity. The

compensable harm in a cause of action under 1962(c) “is the harm

caused by predicate acts sufficiently related to constitute a

pattern, for the essence of the violation is the commission of

those acts in connection with the conduct of an enterprise.” Anza

v. Ideal Steel Supply Corp., 547 U.S. 451, 457 (2006) (quoting

Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 497 (1985)). A

“pattern” of racketeering activity has at least two predicate acts

of racketeering committed within a ten-year time period. 18 U.S.C.

§ 1961(5). Those “predicate acts” must all be violations of the

specified list of criminal laws, as noted in section 1961. 

Moreover, Plaintiff must allege a pattern of racketeering activity

for each RICO defendant. See Defalco v. Bernas, 244 F.3d 286, 306

(2d Cir. 2001). The test recognizes that, in enacting RICO,

“Congress was concerned . . . with long term criminal conduct.” 

Vicom, 20 F.3d at 780.

Plaintiff has not made any cognizable or plausible allegations

that the Cerberus Defendants or the Bosak Defendants committed any

single specific predicate act of racketeering activity, much less

a pattern of racketeering activity. RICO was never intended to

allow plaintiffs to turn garden-variety state law fraud claims into

20

case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 20 of 31
federal RICO actions. Jennings, 495 F.3d at 472. Regarding all

the alleged wrongful activity by TDAF, the allegations allege fraud

against one victim, for one single injury arising out of one

specific event (the repossession of Plaintiff’s vehicle) - thus no

pattern of activity has been alleged for RICO purposes. See Brandt

v. Schal Assocs., Inc., 854 F.2d 948, 952 (7th Cir. 1988)

(plaintiff’s “allegations posit only multiple acts in furtherance

of a single episode of fraud . . . against a single victim . . .

[S]uch a scheme cannot constitute a RICO pattern.”); Lipin Enters.,

Inc. v. Lee, 803 F.2d 322, 323-24 (7th Cir. 1986) (upholding

dismissal of a complaint alleging racketeering acts all designed to

defraud one victim on one occasion). 

Additionally, Plaintiff Fails to State a Claim Under 1962(c) 

Because There Is No Properly Pled RICO Enterprise

Count II of the complaint fails for another reason, which is

that Plaintiff failed to adequately allege a RICO enterprise. An

enterprise “includes any individual, partnership, corporation,

association, or other legal entity, and any union or group of

individuals associated in fact although not a legal entity.” 18

U.S.C. § 1961(4). Thus, an enterprise is not merely a conspiracy,

even if it involves multiple, sometimes unrelated parties. See

Fitzgerald v. Chrysler Corp., 116 F.3d 225, 228 (7th Cir. 1997). 

Here, it seems that Plaintiff is alleging an association in

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fact enterprise. (Compl. ¶ 42.) The Supreme Court in Boyle v.

United States, 556 U.S. 938, 946 (2009), held that an association

in fact enterprise must have a “structure” and must have “at least

three structural features: a purpose, relationships among those

associated with the enterprise, and longevity sufficient to permit

these associates to pursue the enterprise’s purpose.” Id. The

complaint in this case does not identify a purpose, relationship,

or longevity sufficient to pursue a specific purpose by the

Defendants. The allegations do not show how the different actors

(from Chrysler, to owners of a motor dealership, to the owner of a

towing company) are associated, any plausible structure whatsoever,

or what common course of conduct they had. Dismissal is therefore

warranted. See, e.g., Stachon v. United Consumers Club, Inc., 229

F.3d 673, 676 (7th Cir. 2000) (affirming dismissal where members

failed to adequately allege existence of an “enterprise,” finding

“[W]e cannot accept Appellants’ vague allegations of a RICO

enterprise made up of a string of participants, known and unknown,

lacking any distinct existence and structure.”); Fitzgerald, 116

F.3d at 228 (“where a large, reputable manufacturer [Chrysler

Corp.] deals with its dealers and other agents in the ordinary way,

so their role in the manufacturer’s [alleged] illegal acts is

entirely incidental, differing not at all from what it would be if

these agents were the employees of a totally integrated enterprise,

the manufacturer plus its dealers and other agents (or any subset

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 22 of 31
of the member of the corporate family) do not constitute an

enterprise within the meaning of the statute.”); United Food &

Commercial Workers Unions & Emp’rs. Midwest Health Benefits Fund v.

Walgreen Co., 719 F.3d 849, 855 (7th Cir. 2013) (finding no

enterprise where allegations were “only that the defendants had a

commercial relationship, not that they had joined together to

create a distinct entity. . . .”). Here, Plaintiff has made no

allegations of organization between the defendant individuals and

corporations, with no set of specific goals to be reached outside

of the alleged frauds committed against Plaintiff. The allegations

simply do not rise to the definition of “enterprise” in 18 U.S.C.

§ 1961(4). See, e.g., Holland v. Lake Cnty. Mun. Gov’t., No. 2:13-

CV-179-TLS, 2013 WL 5230242, at *4 (N.D. Ind. Sept. 16, 2013)

(finding same Plaintiff’s RICO claims failed to state claims upon

which relief can be granted because Plaintiff failed to plausibly

plead the existence of a criminal enterprise under 18 U.S.C. §

1962(c)). 

The Defendants have set forth other arguments for why the

complaint fails to properly set forth any federal RICO claims under

18 U.S.C. § 1962(c). Having already found the complaint is

deficient because it fails to plead predicate acts, the mail/wire

fraud claims are not pled with particularity, Plaintiff lacks

standing to bring a bank fraud claim, there is no pattern of

racketeering, and a RICO enterprise has not been sufficiently

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alleged, the Court declines to elaborate upon other reasons why the

complaint fails to state a claim upon which relief may be granted. 

However, the Court notes that Plaintiff has also failed to properly

plead the collection of an unlawful debt and that all Defendants

conducted the affairs of a RICO enterprise, which constitute

additional reasons to dismiss the federal RICO claims under section

1962(c).

Plaintiff Has Also Failed to State a Claim Under § 1962(a)

Count I of the complaint alleges violation of 18 U.S.C. §

1962(a), which prohibits use of income derived from a pattern of

racketeering activity to be used in the furtherance of activity and

further allows redress if injury is caused by the use or investment

of racketeering income in the enterprise. Again, the complaint

fails to identify a “pattern” of racketeering activity, and fails

to allege any facts supporting the speculation that proceeds from

any racketeering activity were used or invested in the acquisition

of an enterprise, and further that Plaintiff sustained any injury

proximately caused by the use or investment. See RAO v. BP Prods.

N.A., 589 F.3d 389, 399 (affirming dismissal of claim where

complaint merely restated the elements of section 1962(a) “in

boilerplate fashion and contains no suggestion that money was used

or invested in the operation of an enterprise or that he suffered

an injury caused by the use or investment of racketeering

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 24 of 31
income.”); Vicom, 20 F.3d at 778. Consequently, Count I is also

dismissed. 

Plaintiff Failed to Plead Any Agreement to Conspire Under 18

U.S.C. § 1962(d)

Plaintiff’s claims under 18 U.S.C. § 1962(d) in Count III of

the complaint also fail. To state a RICO conspiracy claim under

section 1962(d), a plaintiff must allege “(1) that each defendant

agreed to maintain an interest in or control of an enterprise or to

participate in the affairs of an enterprise through a pattern of

racketeering activity and (2) that each defendant further agreed

that someone would commit at least two predicate acts to accomplish

those goals.” Lachmund v. ADM Investor Servs., Inc., 191 F.3d 777,

784 (7th Cir. 1999) (quotation omitted). There are no allegations

in the complaint demonstrating Defendants made an agreement to

commit RICO violations. Although he generally alleges the

Defendants “agreed, as alleged and evidenced by their concerted

false statements, false representations, ‘activities’ and omissions

to act that all have a common goal and purpose to injure Robert

Holland in his person” (Compl. ¶ 196), Plaintiff fails to provide

specific facts indicating each Defendant entered into an agreement

to violate RICO. See Goren v. New Vision Int’l, Inc., 156 F.3d

721, 732-33 (7th Cir. 1998)(dismissing where “complaint is utterly

devoid of allegations indicating either a specific agreement by

these defendants to participate in the affairs of the enterprise or

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 25 of 31
an agreement to the commission of two specific predicate acts”). 

Moreover, “[s]ince [Plaintiff] fail[s] to establish a violation of

section 1962(c), [his] 1962(d) claim based on the same facts must

fail as well.” Stachon v. United Consumers Club, Inc., 229 F.3d

673, 677 (7th Cir. 2000). Consequently, Count III is also

dismissed.

Indiana State RICO Claims And Any Other Remaining State 

Claims

The complaint also states claims for violation of the Indiana

Civil RICO statute. (DE #1, pp. 33-34.) Upon due consideration,

the state law claims are DISMISSED WITHOUT PREJUDICE because the

federal claims have been dismissed prior to trial. 28 U.S.C. §

1367(c)(3); Groce, 193 F.3d at 501 (“[I]t is the well-established

law of this circuit that the usual practice is to dismiss without

prejudice state supplemental claims whenever all federal claims

have been dismissed prior to trial.”). 

Default Judgment

Plaintiff has moved for default judgment against Defendants,

Paul Davis, the CEO of Bull Dog Towing, and Bull Dog Towing, first

seeking $41,833,455.00 (DE #32) in damages, then requesting

$66,123,878.90 (DE #99). This Court acknowledges the Seventh

Circuit’s well established rule that “the well-pleaded allegations

of the complaint relating to liability are taken as true[.]” 

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 26 of 31
Merrill Lynch Mortg. Corp. v. Narayan, 908 F.2d 246, 253 (7th Cir.

1990)(quotation omitted). However, pleadings that are “nothing

more than conclusions” are not entitled to the assumption of truth. 

Iqbal, 556 U.S. at 678-79. This includes legal conclusions couched

as factual allegations, see Bonte v. U.S. Bank, N.A., 624 F.3d 461,

465 (7th Cir. 2010), and “[t]hreadbare recitals of the elements of

a cause of action, supported by mere conclusory statements.” 

Iqbal, 556 U.S. at 678. The entry of default judgment lies within

the sound discretion of the trial Court and is not automatic. 

Duling v. Markun, 231 F.2d 833, 836 (7th Cir. 1956). “In

determining whether to enter a default judgment, the court may

consider a number of factors including whether there is a material

issue of fact, whether the default is largely technical, whether

the plaintiffs were substantially prejudiced, and how harsh an

effect a default judgment might have.” Wolf Lake Terminals, Inc.

v. Mut. Marine Ins. Co., 433 F. Supp. 2d 933, 941 (N.D. Ind.

2005)(citation omitted). Plaintiffs seeking default judgment must

demonstrate they are entitled to judgment as a matter of law. Cass

Cnty. Music Co. v. Muedini, 55 F.3d 263, 265 (7th Cir. 1995). 

“Precedent supports the principle that default judgment is

only appropriate if the well-pleaded allegations, along with any

evidence submitted to the court, are sufficient to establish a

legal claim.” Rosenbaum v. Seybold, No. 1:06-CV-352-TLS, 2013 WL

2285946, at *5 (N.D. Ind. May 23, 2013) (citing, inter alia,

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 27 of 31
Wagstaff-EL v. Carlton Press Co., 913 F.2d 56, 57-58 (2d Cir. 1990)

(default judgment properly vacated where plaintiff’s claims were

facially invalid or utterly unsupported); Nishimatsu Constr. Co. v.

Houston Nat’l Bank, 515 F.2d 1200, 1206 (5th Cir. 1975) (“[A]

defendant’s default does not in itself warrant the court in

entering a default judgment. There must be a sufficient basis in

the pleadings for the judgment entered.”); Days Inn WorldWide, Inc.

v. Mayu & Roshan, LLC, No. 06-cv-1581, 2007 WL 1674485, at *4 (D.

N.J. June 8, 2007) (“Default judgment is inappropriate, even where

defendants have failed to appear, unless the plaintiff has provided

well pleaded facts sufficient to establish a claim.”); Terio v.

Great W. Bank, 166 B.R. 213, 218 (S.D.N.Y. 1994) (“The conclusion

that the complaint is subject to dismissal strongly militates

against granting [the] Plaintiff’s application for a default

judgment.”)). “Default judgment is appropriate only if the wellpleaded allegations of the complaint are sufficient to establish a

legal claim.” Franko v. All About Travel, Inc., No. 2:09-CV-233,

2014 WL 2803987, at *1 (N.D. Ind. June 19, 2014) (citing Gard v. B

& T Fin. Serv., No. 2:12-CV-5, 2013 WL 228816, at *1 (N.D. Ind.

Jan. 22, 2013); Marshall v. Baggett, 616 F.3d 849, 854 (8th Cir.

2010) (vacating default judgment)).

Here, as discussed earlier in this Order, Plaintiff has failed

to plausibly plead RICO claims against Defendants, including Bull

Dog Towing, the CEO of Bull Dog Towing, and Paul Davis, and he has

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 28 of 31
failed to show he has set forth a proper legal claim. Plaintiff

failed to properly plead predicate acts of racketeering activity,

there is no pattern of racketeering activity, Plaintiff failed to

adequately allege a RICO enterprise, and he has failed to properly

state a RICO conspiracy claim. Pleading requirements are to be

strictly enforced when default judgment is sought under RICO. Alan

Neuman Prods., Inc. v. Albright, 862 F.2d 1388, 1393 (9th Cir.

1988). The insufficiency of the complaint to state RICO claims

against the defendants that failed to appear warrants denial of the

motions for default judgment and dismissal of the federal claims

against them with prejudice. See, e.g., Hargrave v. Chief Asian,

LC, 479 Fed. Appx. 827, 2012 WL 1573632 (10th Cir. May 7, 2012)

(affirming denial of motion for default judgment and dismissing

suit with prejudice); Husain v. Casino Control Comm’n, 265 Fed.

Appx. 130, 2008 WL 449763, at *1 (3d Cir. Feb. 20, 2008) (affirming

district court’s denial of motion for default judgment and

dismissing complaint with prejudice). Like the other defendants,

the state claims against the defaulted defendants will be dismissed

without prejudice. 

CONCLUSION

For the reasons stated above, (1) Defendants’ Cerberus Capital

Management, LP, Stephen Feinberg, and Robert Nardelli’s Motion to

Dismiss Plaintiff’s Verified Complaint Pursuant to Fed. R. Civ. P.

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 29 of 31
12(b)(6) and (b)(2) (DE #28), is GRANTED. The Clerk is ORDERED to

DISMISS the federal claims against these defendants, Cerberus

Capital Management, LP, Stephen Feinberg, and Robert Nardelli, WITH

PREJUDICE and the state claims are DISMISSED WITHOUT PREJUDICE. (2)

The Motion for Oral Argument on Cerberus Defendants’ Motion to

Dismiss Plaintiff’s Verified Complaint Pursuant to Fed. R. Civ. P.

12(B)(6) and (B)(2) (DE #65) is DENIED. (3) Defendants, Bosak

Motors Auto Dealership, et al.’s Motion to Dismiss (DE #57) is

GRANTED. The Clerk is ORDERED to DISMISS the federal claims

against these defendants, Bosak Motors Auto Dealership, Mr. and

Mrs. Skip Bosak, John Schultheis, Jonathan Jeffries, and Mike

Grzbowski WITH PREJUDICE and the state claims are DISMISSED WITHOUT

PREJUDICE. (4) Defendants’ Motion to Dismiss (DE #69) is GRANTED. 

The Clerk is ORDERED to DISMISS the federal claims against these

Defendants, Kimberly Johnson and TD Auto Finance LLC, Successor in

interest to Chrysler Financial LLC, WITH PREJUDICE and the state

claims are DISMISSED WITHOUT PREJUDICE. (5) Defendants’ Motion to

Dismiss (DE #70), is duplicative and therefore DENIED AS MOOT; (6)

The “Request for Default Judgment Sum Certain by the Clerk of the

Court,” (DE #71), is DENIED. (7) The “Request for Clerk’s Entry of

Default Judgment,” (DE #37), is DENIED. The Clerk is ALSO ORDERED

to DISMISS the federal claims against these defendants, Paul Davis,

Bull Dog Towing, and the CEO of Bull Dog Towing, WITH PREJUDICE and

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case 2:13-cv-00491-RL-JEM document 103 filed 11/18/14 page 30 of 31
DISMISS the state claims WITHOUT PREJUDICE. (8) The “Application

for Judgment by Default Sum Certain” (DE #99), is DENIED. (9) The

“Request for the Court to Issue an Order for the Defendants to

Remove Damaging Credit Information From the Credit Reporting

Agencies,” (DE #100), is DENIED. (10) The relief requested in the

“Brief on Treble Damages Pursuant to State Law,” (DE #101), is

DENIED. Finally, the Clerk is ORDERED to CLOSE THIS CASE. 

DATED: November 18, 2014 /s/ RUDY LOZANO, Judge

United States District Court

 

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