Opinion ID: 2994519
Heading Depth: 1
Heading Rank: 4

Heading: request in the alternative

Text: In the alternative, plaintiffs request that they be permitted to amend their complaints to more specifically allege a claim against the individual defendants, Merritt and Cowles, under Title IX, or, in the alternative, to state a claim against the individual defendants, Merritt and Cowles, pursuant to 42 U.S.C. sec. 1983. Amendments to pleadings should be freely given when justice so requires. They also wanted to amend their pleading against defendant Giles in the event the court granted Giles’s motion for judgment on the evidence. The district court denied the motions, because they did not comply with District Rule 7.1, which states [e]ach motion shall be separate; alternative motions filed together shall each be named in the caption on the face. The district court noted that the Does failed to explain in their request precisely how they planned to amend their complaints, they did not demonstrate good cause to amend the pleadings after the deadline, nor more generally did they show why justice required such amendments. Whether the grant or denial of leave to amend was proper is a question we review for abuse of discretion. Bisciglia v. Kenosha Unified Sch. Dist. No. 1, 45 F.3d 223, 226 (7th Cir. 1995). Fed. R. Civ. P. 15(a) provides that, with the exception of amendments made before the answer is served, a party may amend the party’s pleading only by leave of court or by written consent of the adverse party; and leave shall be freely given. Although this is a liberal standard, under which leave to amend shall be freely granted when justice so requires, justice may require something less in post-judgment situations than in pre-judgment situations. Twohy v. First Nat’l Bank, 758 F.2d 1185, 1196 (7th Cir. 1985), quoted in Diersen v. Chicago Car Exchange, 110 F.3d 481, 489 (7th Cir. 1997). In this case, the district court did not abuse its discretion in denying the Does’ motions to amend the pleadings. As the judge observed, the motions did not state what specifically the Does planned to allege in their amended pleadings. See Glatt v. Chicago Park Dist., 87 F.3d 190, 194 (7th Cir. 1996) (holding motion to amend or supplement the complaint, unlike an original complaint, requires more to compel acceptance than the fact that the pleading sought to be added states a claim). With respect to the Title IX claim, the Does argue that it was clear that the requested amendments went to the issue of whether plaintiffs should have known of their causes of action earlier, because that was the issue raised by defendants’ motions. A quick glance at the motion, which we have set forth above, shows that this is not the case. District courts do not have to engage in guessing games about proposed amendments, and the judge here was well within his discretion to deny this motion. The Does did state something more specific with regard to their desire to bring a sec. 1983 action. But they could have alleged a sec. 1983 violation in their original or amended complaints. They provide no reason why this new claim could only be brought at the last moment. If there were facts warranting the delay, the Does should have brought them to the court’s attention. See Glatt, 87 F.3d at 194 (stating court should consider the probable merit of the claim sought to be added, as well as whether the claim could have been added earlier and the burden on the defendant in trying to meet it). Furthermore, as Giles points out, it would have been futile to have allowed the Does to amend their complaints to assert a sec. 1983 action, because such an action would also have been time- barred under Indiana’s two-year statute of limitations. See Stevens v. Northwest Indiana Dist. Council, United Brotherhood of Carpenters, 20 F.3d 720, 726 (7th Cir. 1994). At bottom, the Does wanted another shot in the event their claims were dismissed. But pleading is not like playing darts: a plaintiff can’t keep throwing claims at the board until she gets one that hits the mark. See id. C. Summary Judgment on Jane C.’s Fraud Claim Jane C. filed an additional claim (count VIII) alleging actual and constructive fraud. The essence of her claim was that Howe officials, Merritt and Cowles, intentionally misrepresented the conditions at Howe in order to induce her to attend the school. She claimed that the officials told her she would be protected at Howe; she also claims that the school’s promotional materials implicitly represented that she would be safe and protected from harm. The district court granted summary judgment on both theories, and so our review is once again de novo. L.R.J. Ryan v. Wersi Electronic GmbH and Co., 59 F.3d 52, 53 (7th Cir. 1995). Under Indiana law, to prove an actual fraud claim, a plaintiff must demonstrate: (1) a material misrepresentation of past or existing fact which (2) was untrue, (3) was made with knowledge of or in reckless ignorance of its falsity, (4) was made with the intent to deceive, (5) was rightfully relied upon by the complaining party, and (6) which proximately caused the injury or damage complained of. Lawyers Title Ins. Corp. v. Pokraka, 595 N.E.2d 244, 249 (Ind. 1992), quoted in Lycan v. Walters, 904 F.Supp. 884, 897 (S.D. Ind. 1995). [A]ctual fraud may not be based on representations regarding future conduct, or on broken promises, unfulfilled predictions or statements of existing intent which are not executed. Lycan, 904 F.Supp. at 897, citing Biberstine v. New York Blower Co., 625 N.E.2d 1308, 1315 (Ind. Ct. App. 1993). There are several problems with Jane C.’s allegations of actual fraud. First, Jane C. did not state in her deposition that either defendant Cowles or Merritt personally misrepresented any facts to her. She said only that she saw Cowles and Merritt from time to time around the school and that her only personal contact with both defendants was when she went to them to appeal some demerits. She met with neither of these defendants prior to enrolling in the school. Second, the sorts of statements on which Jane C. seeks to hang her fraud claim relate generally to the school’s objectives for students’ education upon enrollment. For example, when Jane C. visited the school for an initial interview, she and her parents met with the admissions director, Mr. Cox, for about an hour. Mr. Cox explained how everything at the school worked, including the disciplinary system, and he said that she would be protected and safe from harm. (Jane C. could not remember precisely what she understood she would be protected from.) Jane C. also pointed to Howe promotional brochures and the school’s rules and regulations to support her fraud claim. The Howe brochures contain broad statements of the school’s goals and objectives for its students’ education (e.g., complete preparatory training . . . can only be achieved with a limited number of serious minded cadets. Therefore selection of new students must be carefully made; Howe will consider any student for admission who demonstrates average to above average academic ability, is of good moral character and proven conduct, and who shows a willingness to attend.). The rules and regulations contain more information about Howe’s philosophy and objectives and explain the school’s disciplinary system in detail. This kind of promise of future conduct or objectives does not amount to actionable fraud under Indiana law, and the district court was therefore correct to grant summary judgment on the actual fraud claim. Although promises of future conduct do not give rise to claims of actual fraud, they can, in some instances, give rise to a claim of constructive fraud. Estates of Kalwitz v. Kalwitz, 717 N.E.2d 904, 913 (Ind. Ct. App. 1999). Constructive fraud arises by operation of law when there is a course of conduct which, if sanctioned by law, would secure an unconscionable advantage, whether or not there is actual intent to defraud. Wells v. Stone City Bank, 691 N.E.2d 1246, 1250 (Ind. Ct. App. 1998). The elements of constructive fraud under Indiana law are: (1) a duty existing by virtue of the relationship between the parties; (2) representations or omissions made in violation of that duty; (3) reliance on the deceptive statements or omissions by the complaining party; (4) injury as a result of this reliance; (5) the gaining of an advantage by the defrauding party over the complaining party. Id. at 1250-51. See also Paulson v. Centier Bank, 704 N.E.2d 482, 490-91 (Ind. Ct. App. 1998). Any breach of a duty arising from a confidential or fiduciary relation, whereby the party at fault without any actual fraudulent intent gains an advantage at the expense of any one to whom he owes such duty, amounts to a constructive fraud. Hall v. Indiana Dept. of State Revenue, 351 N.E.2d 35, 38 (Ind. Ct. App. 1976), quoting Gorham v. Gorham, 103 N.E. 16, 18 (Ind. Ct. App. 1913). Jane C. claims that the defendants failed to inform her that the conduct of students and employees could be inappropriate and even dangerous, that the defendants did not provide her with this information out of their desire to induce her to attend the school (as part of a plan to increase female enrollment to bring in more tuition dollars), and that this omission of material fact amounted to constructive fraud. The problem with Jane C.’s claim is that prior to her enrollment, the defendants probably owed her no duty, see Wickey v. Sparks, 642 N.E.2d 262, 266 (Ind. Ct. App. 1994), and so she cannot establish the first element of a constructive fraud claim. Even if Indiana would recognize the potential student - private school recruitment relationship as the kind that gives rise to a duty, her claim still cannot succeed. It would then be analyzed exactly as her post-enrollment claim is. For purposes of the post-enrollment claim, we assume that the school did owe her a duty to supervise and protect her while she was a student. See Miller v. Griesel, 308 N.E.2d 701, 706 (Ind. 1974). At the same time, however, Indiana holds that schools are not insurers of the safety of their pupils, nor are they strictly liable for any injuries that occur. See Norman v. Turkey Run Community School Corp., 411 N.E.2d 614, 617 (Ind. 1980). Jane C. claims that the school should have told her that the conduct of its students and employees was inappropriate, that she ran a substantial risk of harm from physical or mental abuse if she attended, that she would need counseling to avoid or remedy that harm from her first day forward, and that the school would in other ways be wanting. It omitted to make these statements, she continues, because it wanted to induce female cadets to attend the school in order to get their tuition payments. The record, however, does not support Jane C.’s assertions that the school’s omission to communicate these alleged risks to her was deceptive. To the contrary, the school had rules forbidding abusive behavior, and the exhibits that Jane C. attached to her motion in opposition to summary judgment show that the school took disciplinary action where it was aware that school rules had been violated. Its alleged omissions therefore cannot support the hypothesis of the type of deceitful and sadistic behavior that Jane C. accuses Howe of engaging in. Following Turkey Run, we believe that Indiana would not require a school to outline the worst case scenario that a potential or actual student could confront, since its duty is only to exercise reasonable care. In addition, to the extent that the unconscionable advantage factor of the Indiana constructive fraud tort is an independent factor rather than a conclusion from the first four, we doubt that the institution’s alleged desire to enroll more female cadets is the sort of unconscionable advantage that supports a claim. In Wells v. Stone City Bank, supra, for example, the court found an unconscionable advantage when a bank created a sham transaction that generated interest income for itself but no benefit for its customer. See also Swain v. Swain, 576 N.E.2d 1281, 1283-84 (Ind. Ct. App. 1991) (finding unconscionable advantage where plaintiff borrowed money for defendant based upon defendant’s repeated promises to make payments on the debt and to marry plaintiff); McDaniel v. Shepherd et al., 577 N.E.2d 239 (Ind. Ct. App. 1991) (holding that jury could find constructive fraud where agent for insurance company told accident victim she would do better without an attorney and then paid her $1000 in exchange for a release from liability for all known and unknown injuries). Recruiting female students with literature and statements that have not been shown to be intentionally deceptive, and then collecting normal tuition payments from them in exchange for instruction, falls short of this standard. D. Discovery Rulings It is apparent from the parties’ briefs and the court’s rulings that discovery in these cases was protracted and ugly. It went on for more than four years. The plaintiffs apparently asked for nearly every file in Howe’s possession, and Howe was uncooperative. Going through the record exhaustively to determine whether the district court abused its discretion is, however, unnecessary (and in any event an exercise that would be inconsistent with that standard of review). Notwithstanding Jane C.’s claim to the contrary, the contested discovery rulings did not make a difference in the disposition of the plaintiffs’ claims. All claims except Jane C.’s fraud claim were dismissed as time barred; discovery could not have changed that fact. Nor could it have changed the fact that the allegations of fraud are legally insufficient: the allegedly fraudulent statements were promises of future conduct, and therefore not actionable as actual frauds; and there was no constructive fraud because Howe had no unconscionable advantage over her. The district court’s discovery rulings therefore do not amount to reversible error, no matter how plaintiffs think they should have been handled. E. Rule 59(e) Motion Jane C. filed a motion to alter or amend the judgment and for relief from judgment under Fed. R. Civ. P. 59(e) and 60(b)(3); because she filed it within 10 days of entry of the final judgment, the court properly construed it as a Rule 59(e) motion. See Helm v. Resolution Trust Corp., 43 F.3d 1163, 1166 (7th Cir. 1995). Jane C.’s motion urged the court to reconsider its grant of summary judgment because she maintained that Merritt and Cowles had not produced all of the evidence she had requested. Her discussion of the missing evidence did not convince the court that the grant of summary judgment was improper. The district court did not abuse its discretion in denying Jane C.’s motion. See Britton v. Swift Trans. Co., Inc., 127 F.3d 616 (7th Cir. 1997) (grant or denial of Rule 59(e) motion reviewed for abuse of discretion). The court had all of the evidence before it and was intimately familiar with the defendants’ conduct during discovery. We see no reason to overturn the district court’s considered judgment.