Court Opinion

ID: 2996100
Source: CourtListenerOpinion
Date Created: 2015-09-24 19:25:16.634035+00
Date Added: 2024-06-11T11:45:28.105148
License: Public Domain

In the
 United States Court of Appeals
               For the Seventh Circuit
                          ____________

No. 02-1003
BHUPENDRA SHAH,
                                                   Plaintiff-Appellant,
                                  v.

INTER-CONTINENTAL HOTEL CHICAGO OPERATING CORP.,
                                                  Defendant-Appellee.
                          ____________
             Appeal from the United States District Court
        for the Northern District of Illinois, Eastern Division.
                No. 01 C 6015—Ruben Castillo, Judge.
                          ____________
      ARGUED JULY 9, 2002—DECIDED DECEMBER 23, 2002
                          ____________

  Before POSNER, RIPPLE, and WILLIAMS, Circuit Judges.
  POSNER, Circuit Judge. The district judge dismissed Shah’s
suit for failure to state a claim, precipitating this appeal,
which presents a number of procedural issues. According
to the allegations of the complaint, stripped of extraneous
detail, the plaintiff and a partner had leased space from the
defendant for the operation of two gift shops in hotels
owned by the defendant in Chicago. The defendant de-
cided to merge the two hotels, which were next door to
each other at 505 and 535 North Michigan Avenue in
Chicago, and convert the two gift shops into a single,
larger gift shop to serve the merged facility. Under the
2                                                 No. 02-1003

lease, which continued despite the merger, the lessee
was required to pay for the renovation necessary to create
the new store. When the lease (which had been renewed
once) expired, the plaintiff (who had broken with his
partner and become the sole lessee) informed the de-
fendant that he wanted to renew it. The defendant did
not respond, and instead “contracted with Caucasian
individuals, who had no prior relationship with Defen-
dant and who had no knowledge of the store’s func-
tions . . . . Defendant’s decision to select less qualified and
knowledgeable Caucasian individuals to lease it’s [sic]
business premises when other non-Caucasian individ-
uals [viz. the plaintiff] were available with more qualifica-
tions is clearly discriminatory when based on race and
national origin” and “is in violation of Illinois Public Pol-
icy,” which “dictates that such corporate decisions as
the one set forth and described in this complaint should
not be based solely on race or national origin.” As a detail
we note that the reference to racial discrimination is inac-
curate, since Shah is an Indian (from India—not an Amer-
ican Indian) and Indians are Caucasians. But we take the
complaint to be alleging that his national origin is differ-
ent from that of the Caucasians to whom the space he
had renovated was let.
  The complaint was originally filed in an Illinois state
court, and was removed to federal district court by the
defendant on the basis of diversity of citizenship. Four
days later the district judge dismissed the complaint on
his own initiative without a statement of reasons except
to remark that the dismissal was “without prejudice to
the filing of any appropriate amended federal complaint.”
Shah’s lawyer took this to mean that he should recaption
the complaint to indicate that his suit was now in federal
court and to include federal jurisdictional allegations to
help the court satisfy itself that the case was indeed re-
No. 02-1003                                               3

movable. This was a curious reaction, since it is the de-
fendant’s burden to establish that a case is removable to
federal court, Workman v. United Parcel Service, Inc., 234
F.3d 998, 999 (7th Cir. 2000), and Shah, the plaintiff, pre-
sumably wanted to remain in state court, having filed his
suit there. But anyway he did what he thought the judge
wanted him to do and filed his amended complaint.
The defendant moved to dismiss it for failure to state
a claim, arguing that a complaint must include “allega-
tions concerning all material elements” of the “cause of
action” and that Shah had failed to “plead sufficient facts”
to provide a basis for concluding that the defendant had
engaged in discrimination and had failed to cite any stat-
utory authority or to indicate the “type” of discrimination
charged. The defendant noticed its motion for the district
judge’s September 25, 2001, call. Rule 5.3(b) of the U.S.
District Court for the Northern District of Illinois re-
quires all motions to be accompanied by a “notice of
presentment” indicating the date and time at which and
the judge to whom the motion will be presented in open
court; this is to assure that motions are brought to the
judge’s attention for decision promptly and don’t get lost
in the flood of papers that get filed in district courts.
Goss Graphics Systems, Inc. v. DEV Industries, Inc., 267
F.3d 624, 627 (7th Cir. 2001). Rule 78.2 authorizes the dis-
trict court to deny a motion that does not comply with
Rule 5.3(b).
  Shah’s lawyer told the defendant’s lawyer he wouldn’t
be able to attend the September 25 motion call and asked
the lawyer to ask the judge to set a briefing schedule for
the 12(b)(6) motion. When the motion was called on Sep-
tember 25, the defendant’s lawyer duly relayed the re-
quest for a briefing schedule. The judge responded by
ordering the complaint dismissed, though without preju-
dice. He gave no reason for the dismissal, or for making
4                                                No. 02-1003

it without prejudice, saying only that the plaintiff had
“until October 17, 2001 to file a motion for reconsideration
with case authority” and that failure to do so would result
in the dismissal’s becoming a dismissal with prejudice.
On October 17 the plaintiff’s lawyer filed a motion for re-
consideration in which he stated that discrimination in
a real estate transaction violates the Illinois Human Rights
Act. 775 ILCS 5/3-102. But he failed to file the required
notice of presentment, though he had been warned by the
defendant’s lawyer that failure to file such a notice was
a ground under Rule 78.2 for “striking” (actually for
denying, but that is what he meant) the motion. The defen-
dant moved to “strike” the motion for reconsideration
on that ground, and the district court granted the motion.
  The order granting the motion to strike was docketed
on November 29 and the notice of appeal was filed on
December 28. The defendant argues that the appeal, inso-
far as it seeks to challenge the dismissal of the suit back
in September rather than just the denial of the motion
for reconsideration, is untimely because the notice of ap-
peal was filed more than 30 days after the dismissal was
docketed (which was on September 26). But an order
dismissing a suit without prejudice is not a final, appeal-
able order unless it is apparent that the district court
has finished with the case. Strong v. David, 297 F.3d 646,
648 (7th Cir. 2002); Davis v. Ruby Foods, Inc., 269 F.3d 818,
819 (7th Cir. 2001); Hunt v. Hopkins, 266 F.3d 934, 936 (8th
Cir. 2001); see also Smart v. International Brotherhood of
Electrical Workers, Local No. 702, No. 02-1102, 2002 WL
31545466, at *3 (7th Cir. Nov. 15, 2002). Here on the contrary
it was apparent that the judge had dismissed the suit
without prejudice because he thought the plaintiff might
persuade him to rescind the grant of the defendant’s mo-
tion to dismiss. That possibility vanished only when the
No. 02-1003                                                 5

judge struck the motion to reconsider, at which point the
dismissal ripened into a final judgment pursuant to his
order of September 26. In effect, then, the docketing of
the order to strike was the docketing of the final judgment
and started the 30-day period for filing a notice of appeal
running, and the appeal from the final judgment brings
up to the appellate court all interlocutory rulings that
the appellant cares to challenge that are not moot. Weiss
v. Cooley, 230 F.3d 1027, 1031 (7th Cir. 2000); Greer v. St.
Louis Regional Medical Center, 258 F.3d 843, 846 (8th Cir.
2001). Yet as this case and many other cases show, “spring-
ing” judgments (judgments that become final automati-
cally upon the occurrence of some condition specified
in an earlier order) should be avoided because they are a
potent source of confusion concerning the timeliness
of appeals. Otis v. City of Chicago, 29 F.3d 1159, 1163 (7th
Cir. 1994) (en banc); Baltimore & Ohio Chicago Terminal
R.R. v. Wisconsin Central Ltd., 154 F.3d 404, 408 (7th Cir.
1998); Adams v. Lever Bros. Co., 874 F.2d 393, 396 (7th Cir.
1989).
  The striking of the motion for reconsideration was a
harsh sanction, possibly unreasonably so, see Goss Graphics
Systems, Inc. v. DEV Industries, Inc., supra, 267 F.3d at 627;
cf. Davis v. Ruby Foods, Inc., supra, 269 F.3d at 821, as no
harm was done anybody by the failure to file a notice of
presentment. The judge’s action was also precipitate; he
granted the motion to strike without giving the plaintiff
an opportunity to respond and argue for lenity. Id. at 821.
But the issue is academic, since the motion to reconsider
was a clear nonstarter. The Illinois Human Rights Act,
the ground for the motion, is enforceable only in admin-
istrative proceedings and not by an original suit in court,
whether state or federal. Manley v. City of Chicago, 236 F.3d
392, 397 (7th Cir. 2001); Village of Maywood Board of Fire &
6                                                No. 02-1003

Police Comm’rs v. Department of Human Rights, 695 N.E.2d
873, 881 (Ill. App. 1998).
  The most important question presented by the appeal is
whether the complaint stated a claim. The fact that the
judge dismissed the amended complaint on the basis of
the defendant’s 12(b)(6) motion that erroneously argued
that a complaint governed by the federal civil rules must
plead facts and offer statutory or other legal authority
suggests that the judge too may misconceive the plead-
ing requirements under these rules. And by failing to
explain the grounds for his action he violated 7th Cir. R. 50,
which requires a district judge to “give his or her reasons”
for resolving a claim on the merits or terminating a suit.
Members v. Paige, 140 F.3d 699, 701 (7th Cir. 1998).
  The civil rules, as both the Supreme Court and this
court have emphasized repeatedly, e.g., Swierkiewicz v.
Sorema N.A., 534 U.S. 506, 512 (2002); Beanstalk Group, Inc.
v. AM Gen. Corp., 283 F.3d 856, 863 (7th Cir. 2002); Jackson
v. Marion County, 66 F.3d 151, 153 (7th Cir. 1995), establish
a system of notice pleading. The plaintiff is not required
to plead facts or legal theories or cases or statutes, but
merely to describe his claim briefly and simply. In a suit
to collect on a promissory note, for example, all the
plaintiff has to allege is that he is holding the defendant’s
note to him and the defendant owes him $X dollars on it.
He doesn’t have to specify the statute or common law
principle that the defendant has violated by failing to
pay him. Bennett v. Schmidt, 153 F.3d 516, 518-19 (7th
Cir. 1998); Vidimos, Inc. v. Laser Lab Ltd., 99 F.3d 217, 222
(7th Cir. 1996); Bartholet v. Reishauer A.G. (Zurich), 953
F.2d 1073, 1078 (7th Cir. 1992).
  Shah’s complaint alleges that he had a lease with the
defendant pursuant to which he invested money in renovat-
ing space for a gift shop and the defendant refused to re-
No. 02-1003                                               7

new the lease, in effect confiscating the improvements that
the plaintiff had made through his renovations, because
of animosity to people born in India. If the complaint had
stopped there, it clearly could not have been dismissed
consistent with Rule 8 of the civil rules. True, the defen-
dant might be quite unsure what statute, state or federal,
or common law principle the conduct alleged in the com-
plaint might violate, but he could smoke out the plain-
tiff’s theory of the case by serving a contention interroga-
tory on him. Ryan v. Mary Immaculate Queen Center, 188
F.3d 857, 860 (7th Cir. 1999); Taylor v. FDIC, 132 F.3d 753,
762 (D.C. Cir. 1997). Or the judge, if skeptical that there
was any legal basis for such a complaint, could on his
own initiative have asked the plaintiff to file a supporting
legal memorandum. It is commendable rather than cen-
surable in a judge to review complaints as they are filed
and weed out the frivolous ones without putting the
defendant to the burden of responding, provided of
course that the review is conscientious and made by the
judge himself (or herself) rather than delegated to staff.
   The complication here is the plaintiff’s confusing refer-
ence to “Illinois Public Policy,” combined with the inapt
reference in the motion to reconsider (the motion the dis-
trict judge denied) to the Illinois Human Rights Act, and
the astonishing answer that the plaintiff’s lawyer gave us
at argument when asked what his legal theory was: his
answer was that it was fraud. Had the plaintiff alleged
not that the defendant had violated “Illinois Public Policy”
but that he had violated the Rule Against Perpetuities or
the Geneva Conventions, the district judge would have
been within his rights in dismissing the suit as frivolous.
The complaint would fail, in the most literal sense, to
state a claim upon which relief might be granted. But that
is not quite this case. The reference to “Illinois Public
Policy” could be intended to invoke Illinois statutory and
8                                                 No. 02-1003

common law principles (not necessarily limited to the
Human Rights Act) that would create a remedy for someone
denied a contractual advantage on grounds of national
origin, although we do not know whether such a remedy
is available under Illinois law. And with a little research
the plaintiff’s lawyer would have discovered 42 U.S.C.
§ 1982, which forbids discrimination against racial and
related minorities in the sale and lease of real estate. Shaare
Tefila Congregation v. Cobb, 481 U.S. 615, 616-18 (1987). The
complaint was not frivolous on its face, though it is an
open question whether the plaintiff’s lawyer will ever be
able to identify a legal basis for his claim. He may wish
to consult a specialist in discrimination litigation.
   But we think he should have an opportunity to try to
show that the complaint has a legal basis. The dismissal was
premature and the case must be remanded. But we empha-
size that the defendant is entitled to be supplied by the
plaintiff one way or another with a road map of the plain-
tiff’s suit so that he can know how to defend itself. We
have suggested that the simplest way to do this is either
for the judge to ask the plaintiff for a legal memorandum
or for the defendant to serve the plaintiff with a conten-
tion interrogatory.
                                  REVERSED AND REMANDED.

A true Copy:
        Teste:

                           _____________________________
                           Clerk of the United States Court of
                             Appeals for the Seventh Circuit

                    USCA-02-C-0072—12-23-02