source: Caselaw Access Project

author: FORRESTER, District Judge.

license: Public Domain

text:
    James Thomas PATTERSON, Sr., Plaintiff, v. Lawrence L. AIKEN, et al., Defendants.
    Civ. A. No. C85-3501A.
    United States District Court, N.D. Georgia, Atlanta Division.
    July 31, 1985.

      James Thomas Patterson, Sr., pro se.
    Jeffrey R. Nickerson, June Ann Kirkland, Troutman, Sanders, Lockerman & Ashmore, Atlanta, Ga., for defendants.
   ORDER

FORRESTER, District Judge.

This civil action, filed pro se by the plaintiff informa pauperis, is before the court for a frivolity determination pursuant to 28 U.S.C. § 1915(d). While it is the customary practice for this court to forward in forma pauperis lawsuits to the Magistrate for a determination of indigency, and then forward the file to a district judge for a determination of frivolity, prior to authorizing the service of process, in the instant case this procedure was not followed. The Clerk brought the error to the court’s attention immediately after summonses were issued to all of the defendants named in this lawsuit, and the court determined that in the interest of avoiding needless cost and expense to those defendants so served, it would undertake the frivolity determination immediately. Having done so, the court concludes that this complaint must be dismissed as frivolous.

The factual allegations on which this complaint is based consist of an extensive recitation of the various grievances which plaintiff has with respect to the way other judges of this court handled four prior lawsuits filed by this plaintiff. This court has taken judicial notice of its own records, and has reviewed the progress of plaintiff’s prior lawsuits through this court. See Duhart v. Carlson, 469 F.2d 471 (10th Cir.1972), cert. denied, 410 U.S. 958, 93 S.Ct. 1431, 35 L.Ed.2d 692 (1973). The earliest lawsuit on which plaintiff bases his complaints in the action presently before this court was Civil Action No. C75-1631A, an antitrust action, in which plaintiff’s corporation, Southway Theatres, sued several film distributors and theater chains. That action was dismissed in its entirety for want of prosecution by Judge Freeman of this court on March 22, 1985. Appeal was taken on April 15, 1985, and the action is presently pending before the United States Court of Appeals for the Eleventh Circuit. The second lawsuit which plaintiff filed in this court was brought in his own name, and in the name of the National Independent Theatre Exhibitors, Inc., and was also an antitrust lawsuit against certain motion picture industry companies. The Civil Action No. on that case was C78-2060A. That action was concluded after a lengthy trial held before Judge Shoob of this court in August and September of 1982. Judgment was duly entered, pursuant to the jury verdict, in favor of the defendants and against the plaintiff, and the judgment was affirmed by the United States Court of Appeals for the Eleventh Circuit on March 7, 1984. Civil Action No. C81-618A was a related case to Civil Action No. C78-2060A, was also an antitrust lawsuit, and was concluded when Judge Shoob granted summary judgment against the plaintiff and in favor of the defendants on grounds of res judicata from the issues resolved in C782060A. The judgment in C81-618A was also affirmed on appeal by the United States Court of Appeals for the Eleventh Circuit. The fourth case filed by plaintiff in this court, also an antitrust action, was also a lawsuit against several film distributors. The named plaintiff in that action, Civil Action No. C80-445A, was the Screen Advertising Film Fund Corporation. That action was dismissed for want of prosecution by Judge Charles A. Moye, Jr., of this court on July 8, 1985. Plaintiff’s appeal time on that action has not yet run.

The complaint presently before the court was filed by the plaintiff on July 15, 1985. In it, plaintiff has sued fifteen attorneys, some of whom represented him in the four above-referenced actions, some of whom represented defendants in the above-referenced actions, and some of whom turried down plaintiff's case when he offered it to them. The plaintiff has additionally sued eleven film distribution companies, motion picture manufacturers, or executives in those fields, all of whom were named defendants in one or more of the above-referenced lawsuits. Additionally named defendants are the state of Georgia, the state bar of Georgia, and three United States District Judges from this court: Richard C. Freeman, Charles A. Moye, Jr., and Marvin H. Shoob. The complaint prays for damages in the amount of $350,000,000.00.

The facts on which the plaintiff predicates the alleged liability of these 40 defendants consist in the main of allegations that plaintiff’s lawyers abandoned him and otherwise committed malpractice in the other four suits he filed (pages 15, 16, 19, 24, 25, 27, 28-29, 30-31). The plaintiff additionally complains of witnesses or lawyers in these four lawsuits who lied, suborned perjury, or otherwise abused discovery, allegedly to his prejudice (pages 18-19, 20-21, 21-22). With respect to the defendant judges, the complaint contains numerous references to acts on the part of those officers taken in the course of granting or denying motions, ruling on the admissibility of evidence, ruling on motions for change of venue and the like, and ruling on motions to disqualify. The final paragraph of the factual allegations of this complaint consist of plaintiff’s complaints regarding the manner in which the state of Georgia handled his complaints against his own attorneys and opposing counsel. The complaint alleges that plaintiff is entitled to relief on seven theories. Count I is a complaint for breach of the contract of representation between plaintiff and his attorneys in Civil Action No. C75-1631A. The defendants in that count are not of diverse citizenship with the plaintiff, and therefore that count has no independent basis for federal jurisdiction. The same is true of Count II, in which plaintiff asserts a claim for breach of the contract of representation against his attorneys in Civil Action Nos. C78-2060A, C80-445A, and C81-618A. Those defendants are not of complete diversity with the plaintiff, and therefore there is no independent ground of federal jurisdiction. In Count III, the plaintiff attempts to assert an antitrust violation on the part of all 40 of these defendants for conspiring to preclude him from representing other people before this court, and to deny him legal representation. Count IV of the complaint names the state of Georgia, and seeks to impose liability on the state for having been involved in the licensing of attorneys, which plaintiff alleges has created a monopoly. Count V of the complaint alleges that all of the defendants have combined to “obstruct justice” in all four of plaintiffs lawsuits. This count does not allege that plaintiff has recently discovered anything that had any bearing on any of the four lawsuits he has had in this court; rather, Count V consists of a re-hash of complaints plaintiff made during the course of litigation of those four lawsuits. Count VI of the complaint alleges that the three federal judges, together with five of the named attorney-defendants, have committed the tort of interference with plaintiff’s contract with his own attorneys. Finally, Count VII alleges that the three federal judges named in the complaint conspired to deprive Patterson of due process of law by influencing each other to bias against him, and by inducing his attorneys to abandon his cases.

The only two bases of federal jurisdiction present in this complaint are: first, plaintiff’s claims in Counts VI and VII that federal officers (to wit, the federal judges) have deprived him of due process, were biased, and induced his attorneys to break their contract with him; and second, the antitrust claims purported to be encompassed by Counts III and IV of the complaint. Because the court concludes that the named federal judges are entitled to absolute judicial immunity for the acts as alleged in this complaint, and because the court has concluded that plaintiff lacks standing to assert the antitrust injuries which the complaint purports to contain, there is no basis for federal jurisdiction over this complaint, and it will be dismissed as frivolous.

First, with respect to the immunity of the defendant judges, the court notes that such immunity has been part of our common law for many years. See, e.g., Bradley v. Fisher, 13 Wall. 335, 80 U.S. 335, 20 L.Ed. 646 (1872). There are many policy reasons why the law of this country confers absolute immunity upon judges from liability for damages in civil lawsuits. First, and foremost, is that it is in the public interest for judges to be able to conduct themselves in an independent manner, without fear of the consequences which may result if they are liable to be sued later. In Butz v. Economou, the Supreme Court noted that “absolute immunity is ... necessary to assure that judges ... can perform their respective functions without harassment or intimidation.” 438 U.S. 478, 512, 98 S.Ct. 2894, 2913, 57 L.Ed.2d 895 (1977). In Dennis v. Sparks, the Court stated the rationale even more clearly:

Judicial immunity arose because it was in the public interest to have judges who were at liberty to exercise their independent judgment about the merits of a case without fear of being mulcted for damages should an unsatisfied litigant be able to convince another tribunal that the judge acted not only mistakenly but with malice and corruption.

Dennis v. Sparks, 449 U.S. 24, 31, 101 S.Ct. 183, 188, 66 L.Ed.2d 185 (1980). The second policy reason for immunity, related to the first, is to spare the decision-maker the diversion of attention created when, every time he rules against a litigant, he may be made to answer civilly for the ruling. See Butz, supra. The third policy reason favoring absolute immunity for judges is that there is a value to repose in resolving a controversy. As the Court noted in Butz, supra, “Controversies sufficiently intense to erupt in litigation are not easily capped by a judicial decree. The loser in one forum will frequently seek another, charging the participants in the first with unconstitutional animus____” 438 U.S. at 512, 98 S.Ct. at 2913. See also Mason v. Melindez, 525 F.Supp. 270, 277 (W.D.Wis.1981).

In the seminal case on the question of judicial immunity, Pierson v. Ray, 386 U.S. 547, 87 S.Ct. 1213, 18 L.Ed.2d 288 (1967), the Court noted that the fourth reason for judicial immunity is that there are courts of appeal in this country to provide an avenue to review the actions of judges which are alleged to be erroneous, biased, or otherwise corrupt:

[Ijmmunity applies even when the judge is accused of acting maliciously and corruptly, and it is not for the protection or benefit of a malicious or corrupt judge, but for the benefit of the public, whose interest it is that the judges should be at liberty to exercise their functions with independence and without fear of consequences____ It is a judge’s duty to decide all cases within his jurisdiction that are brought before him, including controversial cases that arouse the most intense feelings in the litigants. His errors may be corrected on appeal, but he should not have to fear that unsatisfied litigants may hound him with litigation charging malice or corruption. Imposing such a burden on judges would contribute not to principled and fearless decision-making but to intimidation.

386 U.S. at 554, 87 S.Ct. at 1218 (cites omitted) (emphasis added).

Given the value of absolute immunity, it remains for this court to determine whether the conduct which this complaint alleges on the part of the defendant judges falls within the scope of immunity. In Stump v. Sparkman, 435 U.S. 349, 98 S.Ct. 1099, 55 L.Ed.2d 331 (1978), the Supreme Court established a two-part test for determining whether a judge enjoys absolute immunity for his conduct. The first question is whether the judge, in performing the acts in question, was dealing with the parties in his judicial capacity, and whether the acts were of the sort normally performed by judicial officers. 435 U.S. at 362, 98 S.Ct. at 1107-08. If the answer to this first question is no, then the court must determine that the judge’s conduct is not immune. If the answer is yes, then the court must determine the second prong of the test set out in Stump: Whether the judge’s conduct fell clearly outside his subject matter jurisdiction. 435 U.S. at 359-64, 98 S.Ct. at 1106-08. See also Emory v. Peeler, 756 F.2d 1547, 1553 (11th Cir.1985). The complaint in this case makes no allegation that any of the defendant judges acted without subject matter jurisdiction. The complaint additionally does not allege that any of the parties had any contact with the defendant judges in anything other than the judge’s judicial capacity. In other words, there is no allegation that the judges’ actions in these cases were prompted by personal motivation, or constituted the use of the office of judge as an offensive weapon despite the fact that no party had invoked the judicial machinery. Compare Harper v. Merckle, 638 F.2d 848 (5th Cir.), cert. denied, 454 U.S. 816, 102 S.Ct. 93, 70 L.Ed.2d 85 (1981). Thus, the sole question for the court to determine in deciding whether the judges are immune for the conduct alleged in this complaint is whether the actions alleged are those usually performed by judges. As noted above, immunity is not waived even if the actions on the part of the judge were grievously erroneous, or prompted by malice or corruption. Pierson v. Ray, supra; see also Dennis v. Sparks, supra, 449 U.S. at 31, 101 S.Ct. at 188. In determining the question of whether the act undertaken was a “judicial act,” then, the court focuses on the act itself and not the motivation behind the judges’ conduct. The Stump case, from the Supreme Court, phrases the test as follows: “whether it is a function normally performed by a judge.” 435 U.S. at 362, 98 S.Ct. at 1107. See also McAlester v. Brown, 469 F.2d 1280 (5th Cir.1972).

Applying this standard to the actions alleged in the instant complaint, the court finds that plaintiff’s claims that the defendant judges have obstructed justice, have induced his attorneys to breach their contract with him, and have deprived him of due process of law, are frivolous, since the judges are immune. In the complaint, the factual recitation on which plaintiff rests his claim of liability contains the following alleged actions by the defendant judges:

1. On September 22, 1982 Judge Shoob made “extrajudicial” derogatory remarks to defendant Flint (plaintiff’s attorney at the time) about plaintiff Patterson.

2. During 1983 and the first month of 1984, Judge Shoob held “extrajudicial conversations” with Judges Moye and Freeman, “the effect of which was to prejudice defendants Moye and Freeman against litigation associated with Patterson.”

3. Judge Freeman, in Civil Action No. C75-1631A, denied plaintiff’s motions for substitution, to appear pro se, and for default judgment, doing so by “ignoring” plaintiff’s argument that the defendants in that action were interfering with his efforts to obtain new counsel.

4. Judge Freeman, in Civil Action No. C75-1631A, denied Patterson’s motion for a change of venue based upon bias.

5. In March 1985 Judge Freeman dismissed case number C75-1631A for failure to prosecute.

6. In 1980 Judge Shoob, in Civil Action No. C78-2060A, denied plaintiff’s motion to add parties.

7. Judge Shoob, despite being advised that certain discovery materials were perjurious, and despite being advised that certain of the defense counsel in Civil Action Nos. C78-2060A and C81-618A had failed to comply with discovery requests, granted sanctions against plaintiff Patterson and in favor of the defendants, in open court on April 2, 1982.

8. ’ Judge Shoob did not respond to a letter sent by plaintiff to him on April 5, 1982 in which he complained of perjury, concealment of evidence, and various other alleged acts of wrongdoing by opposing counsel in the case.

9. During the trial of Civil Action No. C78-2060A, Judge Shoob allegedly:

a) Refused to admit certain documents plaintiff wanted admitted;

b) Refused to allow certain witnesses to be impeached;

c) Allowed the defendants to introduce irrelevant and prejudicial evidence;

d) Prejudiced the conspiracy evidence and harassed plaintiff’s lawyer;

e) “Blessed” the introduction of allegedly perjurious testimony;

f) Permitted a witness to make false statements under oath;

g) Refused to permit impeachment of a witness;

h) Directed a verdict on certain of the counts.

10. Judge Shoob declined to disqualify himself on plaintiffs motion in Civil Action No. C78-2060A and C81-618A.

11. Judge Shoob granted summary judgment in Civil Action No. C81-618A on the basis of collateral estoppel and res judicata from Civil Action No. C78-2060A.

12. Judge Moye dismissed two of the named plaintiffs in Civil Action No. C80445A on the basis of lack of standing.

13. Judge Moye reopened the discovery period in Civil Action No. C80-445A, on motion of the defendants.

14. Judge Moye denied plaintiff’s motions to substitute himself as plaintiff to proceed pro se in Civil Action No. C80445A.

15. Judge Moye “ignored” plaintiff's motion for judgment by default in Civil Action No. C80-445A.

16. Judge Moye granted summary judgment for certain of the defendants in Civil Action No. C80-445A, and after remand by the court of appeals allegedly told the plaintiff that he planned to direct a verdict for the defendants at trial of the case.

17. On April 1, 1985, Judge Moye told plaintiff Patterson in chambers that Patterson must locate counsel by May 15, 1985, or face dismissal for want of prosecution.

18. Judge Moye denied plaintiff's motion for a change of venue on the basis of the judge’s alleged bias.

19. Judge Moye dismissed Civil Action No. C80-445A for want of prosecution.

It is abundantly clear to this court that those acts contained in this complaint, numbered one through nineteen, above, are beyond any doubt judicial acts on the part of the defendant judges. The only acts alleged in this complaint which require any discussion at all are those numbered one and two above, in which the plaintiff alleges that Judges Shoob, Freeman, and Moye held “extrajudicial” conversations in which they spoke in a derogatory manner about the plaintiff, such that plaintiff’s attorneys later withdrew from the case. In view of the fact that this complaint does not allege that any of these judges had any contact with this plaintiff except through the lawsuits before them, the court has concluded that the conversations in question were “judicial acts” and therefore the judges are immune from liability.

As noted above, it is the nature of the act and not the intention with which it was done which resolves the question of whether it was a “judicial” act. Therefore, even if the judges conspired together to force plaintiff’s attorneys to withdraw, in the hope of eliminating the lawsuits, the issue is whether having discussions with counsel, and commenting to counsel about their clients are “judicial” acts. The role of a judge, particularly in the federal system, is much more wide-ranging than merely presiding at trial. Judges supervise discovery, often participate in settlement negotiations if the parties request it, and are charged with the general responsibility for management of their case loads and the lawsuits which are before them. Discussing a client, or a party, with an attorney is an integral part of that process. A judge may make a remark about a client which the client could construe as “derogatory” merely by telling the attorney that he does not believe the client has a claim, and that the jury is unlikely to find in his favor at trial. However, such statements are quite common in settlement negotiations. When judges undertake to discuss with lawyers the cases or parties before them, such discussions are clearly judicial acts, where, as here, there is no connection between the judge and the litigants except through the case.

The case books are rife with cases in which, accepting plaintiff’s allegations as true, what society would consider reprehensible conduct on the part of the judge has nonetheless been held to be an immune judicial act. In Dennis v. Sparks, the Supreme Court held that a judge was entitled to full judicial immunity even if he had collaborated with the opposing side to violate the plaintiff's civil rights. 449 U.S. 24, 101 S.Ct. 183, 66 L.Ed.2d 185 (1980). A similar holding is found in Scott v. Dixon, 720 F.2d 1542 (11th Cir.1983), rehearing denied, 729 F.2d 1468, cert. denied, — U.S. -, 105 S.Ct. 122, 83 L.Ed.2d 64 (1984). In Snead v. Kirkland, 462 F.Supp. 914 (E.D.Pa.1978), the court held that even if the defendant judge had conspired with the prosecutors and witnesses to frame the plaintiff in a previous criminal action, the judge was entitled to immunity, for he had acted in his judicial capacity. Finally, in a case very similar to this one, the Southern District of Florida held that judges were immune even if they, had conspired to have the plaintiff’s previous civil court case dismissed. Rothschild v. Ferris, 577 F.Supp. 298 (S.D.Fla.1983) (judges immune even if induced by bias to conspire to have plaintiff’s case dismissed and deny him access to the court). See also Ammons v. Baldwin, 705 F.2d 1445 (5th Cir.1983), cert. denied, 465 U.S. 1006, 104 S.Ct. 999, 79 L.Ed.2d 232 (1984) (judge immune for inducing a citizen to swear out a warrant to arrest the plaintiff); Keating v. Martin, 638 F.2d 1121 (8th Cir.1980) (judge immune even if met ex parte with prosecutor to arrange for denial of admission of some of plaintiff’s evidence); Birch v. Mazender, 678 F.2d 754 (8th Cir.1982) (judge immune even if directed appointed counsel for indigent defendant to enter a guilty plea against defendant’s wishes).

In light of the foregoing, the court concludes that plaintiff’s complaint in this case does not set out facts from which this court could conclude that the defendant judges are not immune. Even construing the complaint entirely in plaintiff’s favor, the complaint alleges that the judges conspired to force the dismissal of plaintiff’s case by inducing his attorneys to resign; and then denied him due process by being biased in their rulings in the cases. No personal motivation is alleged; under the standard set out by the Supreme Court in Stump v. Sparkman, and the other numerous cases cited above, the court concludes that to the extent the complaint attempts to assert a claim against federal judges, in any manner, and in any count, the judges are entitled to immunity and the complaint is frivolous.

The other basis of federal jurisdiction in this complaint is plaintiff’s antitrust claim. It need not detain this court for long. The complaint alleges that the effect of the alleged conspiracy on the part of these 40 defendants has been one of two: either (1) plaintiff has been prevented from acting as an attorney, giving legal advice or representation, due to the existence of state-authorized restraints on the practice of law; or (2) the defendants’ concerted refusal to take Patterson’s case has deprived him of legal advice and representation, in violation of the Constitution. Neither allegation states a claim for relief under Section 1 of the Sherman Act, and although the plaintiff alleges that Section 2 of the Sherman Act, and the Clayton Act, are bases of jurisdiction in this case, no attempt is made in the complaint to state a claim under those provisions.

With respect to the allegation that the plaintiff has been prevented from acting as an attorney, that claim is foreclosed by recent Supreme Court precedent. In Hoover v. Ronwin, 466 U.S. 558, 104 S.Ct. 1989, 80 L.Ed.2d 590 (1984), the Court held that under the “state action” exception to antitrust liability, states and state bar associations are absolutely immune from antitrust liability for predicating admission to the practice of law upon satisfaction of certain criteria. The plaintiff in this case does not allege he meets those criteria as they are applied in Georgia, and therefore under the precedent of Hoover, there can be no antitrust liability for the mere existence of those criteria. See also Foley v. Alabama State Bar Association, 648 F.2d 355 (5th Cir.1981). Because the actions of the state in this case clearly fall within the valid state action exception from antitrust liability, no antitrust liability of any type, as to any defendant, may be predicated upon this prong of plaintiff’s complaint. See Feminist Women’s Health Center v. Mohammad, 586 F.2d 530 (5th Cir.1978), rehearing denied, 591 F.2d 1343, cert. denied, 444 U.S. 924, 100 S.Ct. 262, 62 L.Ed.2d 180 (1979). Therefore, to the extent that this complaint attempts to predicate antitrust liability as to any defendant on the fact that this plaintiff is not permitted to practice law for other people, the complaint fails to state a claim on which relief can be granted and must be dismissed as frivolous.

Plaintiff's other contention, that he could not find anyone willing to undertake to represent him in his lawsuits, also does not state a claim for relief under the antitrust laws. First, the court would note that there is no constitutional right to counsel in a civil case. See United States Constitution, Amendment 6. With respect to the antitrust element, this complaint does not even allege that there is any kind of “anti-competitive” effect achieved because these defendants would not take plaintiff’s case; or because they conspired so that no lawyer would take his case. The court concludes that plaintiff does not have standing to bring an antitrust action against these defendants on the facts as alleged in the complaint.

To have standing to bring an antitrust action a plaintiff must have suffered antitrust injury, which is injury of the type the antitrust laws were intended to prevent and which flows from that which makes a defendant’s acts unlawful. The injury must reflect the anti-competitive effect of either the violation of antitrust law or of the anti-competitive acts made possible by the violation, and it should be the type of loss which a violation of antitrust law would be likely to cause. Brunswick Corp. vs. Pueblo Bowl-O-Mat, Inc., 429 U.S. 477 [97 S.Ct. 690, 50 L.Ed.2d 701] (1977). To have standing a person must be one against whom anti-competitive activity is directed, and not one who has merely suffered indirect, secondary, or remote injury. Jeffrey vs. Southwestern Bell, 518 F.2d 1129 (5th Cir.1975). Incidental or consequential injury or injury remotely caused by an antitrust violation does not give a plaintiff standing to complain that he has been injured by reason of anything forbidden in the antitrust laws. Id.

Midwestern Waffles, Inc. v. Waffle House, Inc., 734 F.2d 705, 710-11 (11th Cir.1984) (emphasis added). In the present case, the plaintiff does not allege any injury to competition. See also Johnston v. Meyer, 413 F.Supp. 490 (N.D.Ind.1976) (allegation that no attorney would take case fails to state a claim under Sherman Act).

Even if the plaintiff’s loss of four lawsuits could be linked to the fact that he could not find an attorney to represent him in those cases, the plaintiff has not made out a claim for violation of the antitrust laws. In order for conduct to constitute an antitrust violation,

... the anti-competitive conduct must have an effect greater than its effect on the plaintiff’s business____ The conduct must have an adverse impact on the competitive conditions in general as they exist within the field of commerce in which the plaintiff is engaged.

Gough v. Rossmoor Corp., 585 F.2d 381, 386 (9th Cir.), cert. denied, 440 U.S. 936, 99 S.Ct. 1280, 59 L.Ed.2d 494 (1978) (emphasis added). In the present case, the complaint does not allege that the fact that plaintiff could not find an attorney to represent him has in any manner had an anti-competitive effect upon conditions in the field of commerce in which this plaintiff is engaged, which is operation of an independent theatre. For these foregoing reasons, the court concludes that this complaint is frivolous to the extent that it attempts to state a claim for violation of the antitrust laws.

From the foregoing discussion, it is readily apparent that Counts III, IV, VI, and VII of this complaint are frivolous, and are therefore DISMISSED. With respect to Count V of the complaint, the “obstruction of justice” count, the court concludes that all the claims attempted to be asserted therein are barred by the doctrines of collateral estoppel and res judicata. The arguments which plaintiff re-hashes now were arguments he raised in some or all of the other four lawsuits he has filed in this court. Judgments adverse to the plaintiff in those lawsuits have either been appealed, are on appeal, or the appeal time has not yet run. Plaintiff’s arguments respecting the use of perjured testimony, bias on the part of the judges, inability to conduct adequate discovery, and the like, are all arguments which either could have been or were raised during the course of those lawsuits. Therefore, the court concludes that, having taken judicial notice of its records, the claims contained in Count V of the complaint are also frivolous, since they are barred by reason of collateral estoppel and res judicata.

That leaves only Counts I and II of this complaint, in which plaintiff alleges breaches of contract by defendants who are not diverse from him, and additionally remaining is part of Count VI of the complaint, to the extent that the four attorneys named therein are not entitled to the judicial immunity of the three judges named therein. However, the four attorneys named in Count VI are of the same citizenship as the plaintiff, and therefore that count is also not diverse.

The court having determined that the alleged bases of federal jurisdiction in this complaint are without merit, since the counts on which they are based are frivolous, and given the fact that the remaining counts of the complaint are state law claims against non-diverse defendants, over which this court declines to exercise jurisdiction, this pro se action is hereby DISMISSED on the grounds of frivolity pursuant to 28 U.S.C. § 1915(d).


author: CURTIS, District Judge.

text:
    FLEXIVAN LEASING, INC., Genstar Container Corporation, Interpool Limited, Itel Containers International Corporations, Nautilus Leasing Services, Inc. and Transamerica ICS, Inc., Plaintiffs, v. M/V C.C. SAN FRANCISCO, her engines, tackle, apparel, furniture and fixtures, in rem, Defendants, The VESSEL C.C. SAN FRANCISCO, Garnishee.
    Nos. CV 84-6331-JWC, CV 84-6175-JWC, CV 84-6243-JWC and CV 84-6289-JWC.
    United States District Court, C.D. California.
    Aug. 20, 1985.
    Robert E. Hawkins, Overton, Lyman & Prince, Los Angeles, Cal., for Flexivan Leasing, Inc.

      Reed M. Williams, Graham & James, Long Beach, Cal., for Genstar Container Corp. and Itel Containers Intern. Corp.
    Ben Suter, Keesal, Young & Logan, Long Beach, Cal., for Nautilus Leasing Services, Inc. and Transamerica ICS, Inc.
    David S. Porter, Fisher, Porter & Kent, Long Beach, Cal., for Interpool, Ltd.
    David E.R. Woolley, Lillick, McHose & Charles, Los Angeles, Cal., for M/V C.C. San Francisco.
   ORDER RE PLAINTIFFS’ SUMMARY JUDGMENT MOTION TO ESTABLISH MARITIME LIEN

CURTIS, District Judge.

INTRODUCTION

On July 1,1985, in response to defendant Char Yigh Marine (Panama) S.A.’s Renoticed Motion to Compel Plaintiffs In Rem to Justify Maritime Arrests, this Court found that the in rem arrests of the vessell “CC San Francisco” by the container lessor plaintiffs were colorably valid, thereby validating this Court’s continued admiralty jurisdiction over the claims. The Court therefore ordered the matter to proceed, and requested that the container claimants submit motions for summary adjudication under FRCP 56 as to all issues regarding the in rem claims which are not subject to substantial controversy.

The Court now has before it summary judgment motions brought by the container claimants seeking to establish, as a matter of law, that the containers provided to “CC Lines” give rise to maritime liens. This opinion governs the motions of Flexi-van Leasing, Inc. (CV 84-6331), Genstar Container Corporation (CV 84-6175), Interpool Limited (CV 84-6243), Itel Containers International Corporation (CV 84-6175), Nautilus Leasing Services, Inc. (CV 84-6289), and Transamerica ICS, Inc. (CV 84-6289). Although the facts and contracts relied upon differ slightly from case to case, they each present this same question of law. Rather than discussing the specific facts of each case, this order respectively adopts and incorporates by reference the Statements of Uncontroverted Facts and Conclusions of Law submitted concurrently by each of the container claimants with their motions.

DISCUSSION

In this in rem action, plaintiffs seek to confirm that they have maritime liens for necessaries based on containers furnished to the vessel “CC San Francisco.” Plaintiffs further seek to establish that the lien encompasses all periods the containers served as the “functional equivalent” of the vessel’s hold, including incidental land uses.

The governing statute is the maritime lien statute, 46 U.S.C. § 971. It provides:

“Any person furnishing repairs, supplies, towage, use of dry dock or marine railway, or other necessaries, to any vessel, whether foreign or domestic, upon the order of the owner of such vessel, or of a person authorized by the owner, shall have a maritime lien on the vessel, which may be enforced by suit in rem, and it shall not be necessary to allege or prove that credit was given to the vessel.”

The first requirement for a maritime lien under § 971 is that the container or equipment be a “necessary.” A “necessary” is any item furnished to a vessel which is reasonably necessary for the venture in which that particular ship is engaged. Clubb Oil & Tools, Inc. v. M/V George Vergottis, 460 F.Supp. 835, 841 (S.D.Tex.1978). Containers are portable receptacles in which large numbers of smaller packages may be transported. They are the modern substitute for the hold of the vessel. Leather’s Best, Inc. v. Mormaclynx, 451 F.2d 800, 815 (2nd Cir.1971). It is clearly established that containers are necessary to a container ship’s operation. Nautilus Leasing Services, Inc. v. M/V Cosmos, et al., 1983 AMC 1483 (S.D.N.Y.1983); Transamerica ICS, Inc., v. M/V Panatlantic, 1984 AMC 489 (S.D.Fla.1983). Since the “CC San Francisco” carried only containerized cargo while in the service of the “CC Line,” containers were more than reasonably necessary for her operation.

The second requirement, and the one around which this controversy is centered, is that the containers be “furnished to” the “CC San Francisco.” It is undisputed by the parties that the containers were supplied by the container claimants to “CC Lines” for use in its transpacific shipping service between various ports in the Far East and the West Coast of the United States.

However, because the containers were not supplied to the “CC San Francisco” specifically, defendant argues that the “furnishing to any vessel” requirement has not been met. Plaintiffs, on the other hand, submit that by furnishing containers to “CC Lines” for exclusive use on board its fleet of container vessels, and by virtue of their actual use on board the “CC San Francisco,” plaintiffs furnished containers to the vessel within the meaning of 46 U.S.C. § 971. The Court agrees with plaintiffs.

The use of containers in shipping has been characterized as “one of the most important technological developments in the transportation of goods by sea since steam replaced sail.” Simon, The Law of Shipping Containers, 5 J.Mar.L. & Com. 507 (1974). See also CTI-Container Leasing v. Oceanic Operations, 682 F.2d 377, 380 (1982). The Supreme Court has recognized how containerization has revolutionized maritime cargo-handling techniques, noting that

“containerization permits the time-consuming work of stowage and unstowage to be performed onland in the absence of the vessel. The use of containerized ships has reduced the costly time the vessel must be in port and the amount of manpower required to get the cargo onto the vessel.”

Northwest Marine Terminal Co. v. Caputo, 432 U.S. 249, 270, 97 S.Ct. 2348, 2360, 53 L.Ed. 320 (1977) (footnote omitted).

One of the key advantages of containers is that they allow the use of several different modes of transportation — marine, motor, rail, or air — to transport goods on a door to door basis. See Tombari, Trends in Oceanbome Containerization and its Implications for the U.S. Liner. Industry, 10 J.Mar.L. & Com. 311 (1979). As the evidence in this case indicates, containers are routinely leased by shipping lines without specification as to the exact vessel on which they may be used. In fact, a container can be used on several different vessels during the duration of its lease. In light of today’s shipping practices, defendant’s contention that a container need be furnished to a specific vessel, rather than to a fleet of vessels, in order for a valid maritime lien to exist, is highly impractical. In addition, and most importantly, it is unsupported by the law.

The delivery of necessaries to a fleet of vessels gives rise to a maritime lien to the extent the necessaries in fact were placed on individual vessels in the fleet. Moreover, those necessaries can be supplied to a fleet pursuant to a single contract. Dampskibsselskabet Dannebrog v. Signal 011 & Gas Co. of California, 310 U.S. 268, 276-77, 60 S.Ct. 937, 941-42, 84 L.Ed. 1197 (1940); Brock v. SS Southhampton, 231 F.Supp. 280, 282 (D.Ore.1964); Jeffrey v. Henderson Bros., Inc. 193 F.2d 589, 593-94 (4th Cir.1951). In Transamerica ICS Inc. v. M/V Panatlantic, 1984 A.M.C. 489 (S.D.Fl.1983), the court found that defendant’s vessel’s containers were “necessaries,” and also noted that the requirement that such necessaries be “furnished to” a vessel does not require direct delivery on the basis of separate contracts for each vessel. The court stated:

“After reviewing the history and operation of the container leasing business as explained by plaintiffs, the Court is convinced that containers are “necessaries” within the meaning of 46 U.S.C. sec. 971. Furthermore, for purposes of creating a valid maritime lien, it may not be essential, and indeed may not be desirable, that the container be delivered directly to the vessel, be sold rather than leased, or be earmarked for a particular vessel. . . . [T]he Supreme Court has noted how the courts and Congress have accommodated maritime law to modern cargo-handling techniques. Northeast Marine Terminal Co., Inc. v. Caputo, 432 U.S. 249, 268-72, 97 S.Ct. 2348, 2359-61, 53 L.Ed.2d 320, 1977 AMC 1037, 1051-55 (1977).”

In light of the above authority, and consistent with modern shipping practices, the Court holds that the delivery of containers to a fleet of vessels, without specification as to a specific ship, does not defeat a maritime lien where the actual use of those containers aboard a specific ship can be proved.

Defendant also raises several additional arguments as to why plaintiffs should be denied their maritime lien. Suffice it to say, however, that at oral argument, defendant admitted that its main legal argument concerns lack of delivery to a specific ship, and that the rest of the arguments raised were “fluff.” Thus, without going into the specifics of those arguments for purposes of their rejection in this opinion, the Court hereby holds (1) that the plaintiffs’ container leases with “CC Line” are maritime contracts; (2) that plaintiffs’ containers served as the functional equivalent of the hold of the “CC San Francisco” and are therefore “necessaries” within the meaning of 46 U.S.C. § 971; (3) that plaintiffs “furnished” containers to the “CC San Francisco” within the meaning of 46 U.S.C. § 971; (4) that plaintiffs have valid maritime liens for necessaries against the vessel “CC San Francisco” for all containers carried aboard that vessel; and (5), that the maritime lien encompasses all periods plaintiffs’ containers served as the functional equivalent of the hold of the “CC San Francisco,” including incidental land use. Proof of plaintiffs actual damages under their maritime liens await further proceedings.


author: SKINNER, District Judge.

text:
    John T. SULLIVAN, et al., Plaintiffs, v. Erving M. MARSHALL, Sr., et al., Defendants.
    Civ. A. No. 80-0077-S.
    United States District Court, D. Massachusetts.
    Sept. 9, 1985.

      Bernard A, Dwork, Barron & Stadfield, Boston, Mass., for plaintiffs.
    George C. Deptula, Berlin, Clarey & Green, and Jack R. Pirozzolo, Willcox, Pirozzolo & McCarthy, Boston, Mass., for defendants.
   MEMORANDUM AND ORDER ON DEFENDANTS’ MOTIONS FOR SUMMARY JUDGMENT

SKINNER, District Judge.

In this action John T. Sullivan and Suzanne J. Sullivan (the “plaintiffs”) seek damages under 42 U.S.C. § 1983 against the Town of Townsend, Massachusetts (the “town”), Selectmen Robert Struthers and Jane Jackson (the “defendant selectmen”), Chief of Police Erving M. Marshall, Sr., and four police officers (together, the “police defendants”) for alleged deprivations of civil rights as well as Massachusetts statutory and common law causes of action. Their claims arise from John Sullivan’s arrest at Townsend police headquarters on August 14, 1978, and an alleged pattern of harassment of the plaintiffs by the police defendants thereafter. I have before me the motions of the various defendants for summary judgment on most of these claims.

It is undisputed that Townsend Police Chief Erving Marshall, Sr. arrested John Sullivan shortly after the latter entered police headquarters around 3:45 p.m. on August 14, 1978. Sullivan was unhappy with police efforts to investigate hit-and-run damage to his automobile. By Marshall’s account, Sullivan belligerently demanded to know what steps had been taken to investigate the damage to his vehicle, refused to leave the station when requested, and challenged Marshall to arrest him. When Sullivan failed to leave, Marshall arrested him and handcuffed Sullivan’s right wrist. He was unable to handcuff the left wrist. While Sullivan struggled to get away, Marshall radioed for assistance. The defendant police officers Christopher Struthers, Erving Marshall, Jr., Brown, and Kumpu arrived. They forced Sullivan against a wall and then to the floor in order to fasten his left arm in the handcuffs. Erving Marshall, Jr. then booked him for disorderly conduct and assault upon a police chief.

In Sullivan’s version, Marshall painfully forced the handcuff onto his right wrist, then yanked him about the office using the other handcuff as a lead. When the other police defendants arrived, they slammed him into two walls, punching and striking him.

Defendant Marshall, Jr. threatened the uncooperative plaintiff with a can of mace while booking him. Officers Struthers and Marshall, Jr. transported him to the Ayer lockup, from there to Nashoba Valley Community Hospital for treatment of numbness in his right hand and for several bruises, cuts and abrasions, and back to the Ayer lockup. About two hours after his arrest he was released. Suzanne Sullivan met him at the hospital and later picked him up at the Ayer lockup.

That evening John Sullivan met with the defendant selectmen at town hall. He showed them his injuries and described the events of the afternoon. They told him they could not take any action individually but advised him to make a formal complaint to the Board of Selectmen. The third selectman was Ronald Rajaniemi, who is not a defendant in the case. Sullivan did so, and the Board held a hearing on August 22, 1978, at which Sullivan and the police defendants each told their sides of the story. The affidavits of the defendant selectmen and their answers to interrogatories conflict on whether the Board took no further action or instead voted to deny John Sullivan’s claim.

The plaintiffs allege that the police defendants harassed them for several years after the incident of August 14 by parking cruisers immediately outside the plaintiffs’ home on the Townsend Common at all hours as many as fifty times from August 1978 and mid-1981, by making obscene gestures to the plaintiffs and their friends, and by tailgating the cars of the plaintiffs and their friends. John Sullivan identified Police Chief Marshall, Officer Marshall, Jr. and Officer Kumpu as the actors in these incidents. As a result of this harassment, Suzanne Sullivan testified on deposition that she suffered intense anxiety and fear. At the time of her husband’s arrest she was pregnant and suffering from preeclampsia diagnosed about two weeks before, a condition resulting in the stillbirth of her child in October 1978. The plaintiffs ascribe this loss, the subsequent deterioration of their marriage and their eventual divorce directly to the harassment they have alleged.

The plaintiffs also allege that the defendant selectmen, and through them the Town, encouraged or acquiesced in this harassment by failing to discipline the police defendants.

In addition to the meeting with Struthers and Jackson at Town Hall the evening of August 14, 1978, John Sullivan had several contacts with the defendant selectmen. Selectwoman Jane Jackson testified by affidavit that Sullivan once called her to complain about a cruiser parked in front of his house and she advised him to make a formal request for action by the Board of Selectmen. He did not do so. She declared that he also spoke with her on only one other occasion to tell her that his wife had had a stillbirth.

Sullivan spoke to Selectman Robert Struthers twice shortly after the hearing on August 22 to ask if the selectmen had made a decision on his complaint against the police, called to tell him the results of a medical examination concerning nerve damage done by the handcuffs he had worn, visited him to tell Struthers of the stillbirth of his child, visited him to demand that Struthers remove the police chief, and called to complain about a police cruiser parked across the street from his house. Struthers stated he consistently told Sullivan to raise Ms complaints formally before the Board of Selectmen. The plaintiffs also assert that Struthers approached John Sullivan shortly after the stillbirth and offered to have the criminal charges dropped if Sullivan would release the Town and officers from civil liability. Suzanne Sullivan never spoke directly with either of the defendant selectmen.

John Sullivan was acquitted of the criminal charges of assault and disorderly conduct on May 25, 1979. He asserts that the alleged harassment stopped early in 1981. He never formally lodged any further complaints with the Board of Selectmen after the hearing on August 22, 1978.

John Sullivan has stated viable claims under 42 U.S.C. § 1983 for false arrest, the use of excessive force and malicious prosecution. Landrigan v. City of Warwick, 628 F.2d 736 (1st Cir.1980). There is no need for abstention with respect to the claim of malicious prosecution, as in Landrigan, because the criminal proceeding has terminated in a finding of not guilty. In this circuit, the existence of state remedies does not preclude action under § 1983 for unconstitutional deprivation of liberty and excessive use of force, despite Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981) and Hudson v. Palmer, 468 U.S. 517, 104 S.Ct. 3194, 82 L.Ed.2d 393 (1984). Voutour v. Vitale, 761 F.2d 812, 818 n. 4 (1st Cir.1985). His claims under state law for assault and battery, false arrest and malicious prosecution arise out of the same operative facts and are within the pendent jurisdiction of the court. United Mine Workers v. Gibbs, 383 U.S. 715, 725-26, 86 S.Ct. 1130, 1138-39, 16 L.Ed.2d 218 (1966). John Sullivan has also stated a claim for emotional distress. To the extent this is alleged to be the result of the false arrest, excessive use of force and malicious prosecution, it is an element of damage, but not if it is the result of the alleged subsequent harassment, as stated hereinafter.

In my opinion, the Sullivans’ claim for damages for emotional distress for their alleged harassment by police officers following the arrest is not cognizable under 42 U.S.C. § 1983. It does not appear that the harassment was intended to dissuade the plaintiffs from complaining to the Board of Selectmen or as retaliation for filing a claim. While the plaintiffs may have alleged a tort under state law, the commission of a tort by a person acting under color of state law does not create liability unless there is also a violation of the United States Constitution or a federal law. Paul v. Davis, 424 U.S. 693, 700, 96 S.Ct. 1155, 1160, 47 L.Ed.2d 405 (1976). No federal statutes are involved; no deprivation of liberty or property is alleged under the Fourteenth Amendment. Plaintiffs apparently rely on a generalized right “to marry, establish a home and bring up children”. Meyer v. Nebraska, 262 U.S. 390, 399, 43 S.Ct. 625, 626, 67 L.Ed. 1042 (1923). The thrust of the protection afforded to such rights by the Constitution is the guarantee that freedom of choice with respect to those matters will not be circumscribed by state imposed restrictions. Zablocki v. Redhail, 434 U.S. 374, 384, 98 S.Ct. 673, 680, 54 L.Ed.2d 618 (1978). No such restrictions on freedom of choice were imposed on the plaintiffs. While it is true that harassment by police officers may impair the enjoyment of life in all its aspects, that is true of many torts with no constitutional implications.

The question then remains whether the court may retain jurisdiction of the plaintiffs’ state law tort of intentional infliction of mental and emotional distress. It seems clear that the claim of Suzanne Sullivan may not be retained, since she has no viable federal claim. She would be a “pendent party”. In Aldinger v. Howard, 427 U.S. 1, 14-16, 96 S.Ct. 2413, 2420-21, 49 L.Ed.2d 276 (1976), the Court ruled that pendent jurisdiction could not be exercised over a defendant against whom there was no federal claim, even though the claim under state law arose out of the same operative facts. The language in the opinion is directed to the status of the defendant who would not be otherwise in federal court and does not quite reach the case of a “pendent plaintiff”. Several district courts have reached the conclusion that there is similarly no jurisdiction over the case of a pendent plaintiff. In Leopold v. Birkett, 523 F.Supp. 525 (E.D.N.Y.1981), the plaintiff husband claimed damages for alleged police brutality under 42 U.S.C. § 1983 and state tort law. His wife sued for loss of consortium. Judge Nickerson dismissed the wife’s claim in reliance on Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 373, 98 S.Ct. 2396, 2402, 57 L.Ed.2d 274 (1978), Aldinger v. Howard, supra, and Zahn v. International Paper Co., 414 U.S. 291, 94 S.Ct. 505, 38 L.Ed.2d 511 (1973).

These three decisions leave the distinct impression that a majority of the Supreme Court would hold that ancillary jurisdiction does not exist over Sylvie Leopold’s claim. It is true that all the claims asserted in this case by both spouses will depend upon much the same proof and that judicial economy would be served if all of them were tried in one proceeding. But this factor was not enough to convince the Supreme Court in situations equally persuasive. Indeed, if one can distill any useful general principle from its recent opinions, it is that the Court does not look favorably on efforts to assert claims ancillary to federal cases, except perhaps in those instances where the argument of judicial economy and convenience can be coupled with the circumstance that only in a federal court may all the claims be tried together.

523 F.Supp. at 527. I agree. Accordingly, Suzanne Sullivan’s state law claims must be dismissed for lack of jurisdiction. It is arguable that the court could take pendent jurisdiction of John Sullivan’s claims arising out of the alleged harassment if these claims arose out of the same operative facts. This would be a very tenuous although arguable conclusion. In my view the alleged harassment arises out of a discrete set of facts which although connected to the arrest and other events of August 14 in terms of possible motivation and animus would require completely separate proof. In any case, retention of pendent jurisdiction is addressed to the sound discretion of the court, and one of the guiding factors is judicial economy. Because totally different evidence is required to sustain the claim of mental distress resulting from harassment, no judicial economy will result from retaining jurisdiction. On the contrary, since Suzanne Sullivan's claims arising out of harassment must be tried in state court (if at all), judicial economy requires that her husband’s claims arising out of the same facts be tried there also.

For the reasons stated above, Suzanne Sullivan’s claims for loss of consortium must also be dismissed. It doesn’t seem to me that the complaint states a claim for loss of consortium in any case. It appears that Mr. Sullivan was released approximately two hours after his arrest. It is not alleged that his injuries, physical or emotional, have in any way prevented him from being a companion to his wife and performing the usual connubial duties. To be sure, the marriage eventually ended in divorce, but it appears from the affidavits of the parties that Mrs. Sullivan decided she didn’t want any more consortium and walked out. My understanding of the state law claim for loss of consortium is that some substantial period of spousal absence or disability is required. I doubt that a two-hour absence is actionable. The complaint suggests that Mr. Sullivan is also claiming loss of consortium because of the emotional breakdown of his wife, but this arises out of the alleged harassment. His claim of loss of consortium is ancillary to his wife’s claim of a state tort. As I have indicated, both must be tried in state court.

Given my disposition of these claims on jurisdictional grounds, I will not discuss the issues of causation and foreseeability of the injuries alleged by the plaintiffs, although these issues have been extensively briefed by the parties, except to note that they are indeed serious questions.

The plaintiffs’ claims under M.G.L. c. 12, §§ 11H and 111 must be dismissed because the statute was not passed until a year after the alleged unlawful arrest.

There remains the claims against the selectmen and the town. These arise out of the alleged harassment. As indicated above, these claims are not founded on federal law, there is no pendent jurisdiction with respect to Suzanne Sullivan’s claim and as a matter of discretion I decline to exercise pendent jurisdiction over John Sullivan’s claim, assuming the doubtful proposition that any exists. Accordingly, the claims against the selectmen must be dismissed.

The ease against the Town of Townsend raises a novel question. Liability under § 1983 may only be predicated on a municipal policy. Monell v. New York City Department of Social Services, 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978). The Supreme Court has recently held that a policy of officially sanctioned use of excessive force cannot be inferred from a single instance. City of Oklahoma City v. Tuttle, — U.S. -, -, 105 S.Ct. 2427, 2435-37, 85 L.Ed.2d 791 (1985). In that case, and in the typical police case such as Voutour v. Vitale, supra, the action complained of is that of one or several policemen. In this case, the police defendants constitute the entire police force of Townsend, including the chief. If, as seems likely, the chief of police was for practical purposes the effective policymaker on police matters, then town policy was being made on the spot, and the Town should be liable notwithstanding City of Oklahoma City v. Tuttle, supra, which does not deal with this unique exurbian phenomenon.

Summary.

The defendants’ motions are DENIED with respect to John Sullivan’s claims against the police defendants and the Town under 42 U.S.C. § 1983 for the events of August 14, 1978 and related state common law causes of action, i.e., assault and battery, false imprisonment and malicious prosecution. The defendants’ motions for summary judgment are ALLOWED in all other respects and all of the plaintiffs’ other claims are DISMISSED.


author: SAFFELS, District Judge.

text:
    J.C. STOKES, Plaintiff, v. Verne ORR, Secretary of the Air Force, Defendant.
    Civ. A. No. 85-2170-S.
    United States District Court, D. Kansas.
    Sept. 13, 1985.
    C.W. Cade, Ed Schneeberger, Chartered, Leavenworth, Kan., John A. Dicke, Denver, Colo., for plaintiff.
    Benjamin L. Burgess, Jr., U.S. Atty., Julie Robinson Trice, Asst. U.S. Atty., Kansas City, Kan., Alexander S. Nicholas, Major, General Litigation Div., Office of The Judge Advocate General, United States Air Force, Washington, D.G., for defendant.
   MEMORANDUM AND ORDER

SAFFELS, District Judge.

This matter is before the court on defendant’s motion to dismiss pursuant to Rule 12(b)(1) and (6), Federal Rules of Civil Procedure, for failure to state a claim upon which relief can be granted and for lack of subject matter jurisdiction. This action involves an appeal of plaintiff’s conviction of felony counts by court-martial.

Defendant asserts that plaintiff has failed to state a claim upon which relief can be granted because the Secretary’s power to grant the requested relief has been removed by an act of Congress. Defendant also contends that to the extent that the complaint is construed as a money claim against the United States, pursuant to the Tucker Act, 28 U.S.C. §§ 1346(a)(2) and 1491, plaintiff’s claim should be dismissed for lack of subject matter jurisdiction.

Plaintiff asserts that the 1983 amendments to 10 U.S.C. §§ 1552 and 1553 are not to be applied retroactively. Further, plaintiff contends that if this legislation is applied retroactively, it would result in a violation of the ex post facto clause of the United States Constitution. Plaintiff bases his right to review based on his right to redress the alleged violations of his constitutional rights during his court-martial proceedings.

The court will initially address defendant’s claim that plaintiff has failed to state a claim upon which relief may be granted due to the 1983 amendments to 10 U.S.C. §§ 1552 and 1553. The court finds that the language and legislative history of the Military Justice Act supports defendant’s contention that the Secretary has no power to overturn court-martial convictions by “correcting the records.” It is therefore necessary to address plaintiff’s assertion that a retroactive application of the 1983 amendment to a prior court-martial conviction would be a violation of the ex post facto clause.

To establish a violation of the ex post facto clause, two elements are required: the law in operation (1) “must apply to events occurring before its enactment;” and (2) “it must disadvantage the offender affected by it.” Johnson v. United States Parole Commission, 555 F.Supp. 461, 462 (D.Minn.1982), quoting Weaver v. Graham, 450 U.S. 24, 101 S.Ct. 960, 67 L.Ed.2d 17 (1981).

It is a well-settled rule of law that legislation is presumed to apply prospectively, and that it is a plaintiff’s burden of proof to show that the statute is to be given retroactive effect. Greene v. United States, 376 U.S. 149, 160, 84 S.Ct. 615, 621-22, 11 L.Ed.2d 576 (1964). After a careful examination of the statute, there can be little doubt that 1983 amendments to 10 U.S.C. §§ 1552 and 1553 were intended to apply retroactively. A review of the case law and legislative history clearly supports this proposition. It was the precise inadequacies and inexperience of the Board For The Correction Of Military/Naval Records [BCMRS] and Secretaries which prompted the passage of the 1983 amendment. Rep. No. 53, 98 Cong. 1st Sess. 11, 36 (1983).

Plaintiff; argues that if the Military Justice Act is applied retroactively, it violates his constitutional right to appeal.

Once it has been determined that the congressional intent of legislation is to apply it retroactively, the statute is presumed constitutional. United States v. Northeastern Pharmaceutical & Chemical Co., Inc., 579 F.Supp. 823, 840 (W.D.Mo.1984). The burden is then on the plaintiff to prove that Congress acted arbitrarily and irrationally. The court finds that plaintiff has not proffered sufficient evidence to state a claim of the unconstitutionality in applying 10 U.S.C. §§ 1552 and 1553 retroactively. The court finds that defendant’s motion pursuant to Rule 12(b)(6) for failure to state a claim upon which relief may be granted should be granted.

The court finds that it is unnecessary to rule on the merits of defendant’s motion to dismiss for lack of subject matter jurisdiction.

IT IS BY THE COURT THEREFORE ORDERED that defendant’s motion for failure to state a claim upon which relief may be granted should be granted. IT IS FURTHER ORDERED that defendant’s motion to dismiss for lack of subject matter subjection is hereby denied as moot.


author: BIGGERS, District Judge.

text:
    Leroy McGOWAN, Jr., Administrator of the Estate of and Personal Representative of Tommie Lee Tipton, also known as Tommie Lee Sullivan, Deceased, and on Behalf of the Heirs of the Deceased, and Persons Entitled to Recovery, Plaintiff, v. James Albert RILEY, Individually and in his Official Capacity as Deputy Sheriff of DeSoto County, Mississippi, et al., Defendants.
    No. DC83-282-NB-O.
    United States District Court, N.D. Mississippi, Delta Division.
    Sept. 30, 1985.
    Christian Goeldner, Southaven, Miss., Hayden D. Lait, Memphis, Tenn., for plaintiff.
    William W. Ballard, H.R. Gainer, Hernando, Miss., Ralph Chapman, Clarksdale, Miss., for defendants.
   MEMORANDUM OPINION

BIGGERS, District Judge.

This diversity cause of action came before the court on the motion to dismiss filed by defendants James Albert Riley and Howard Taylor, and on the motion to dismiss filed by defendants B.G. Allen, Joe A. Gates, Floyd S. Robertson, Wilbert Bates, and Eulo Loyd (the “supervisor defendants”). Being fully advised in the premises, the court is now in a position to rule on these motions.

This cause arose out of the apparent suicide by hanging of Tommie Lee Tipton, also known as Tommie Lee Sullivan, while in custody at the DeSoto County, Mississippi jail. The decedent had been taken into custody at the request of his family after he threatened to kill both them and himself. The plaintiff, who is the decedent’s half-brother and administrator, asserts causes of action against the defendants under 42 U.S.C. § 1983 (1981) for deprivations without due process, under U.S.Const. amend. VIII for cruel and unusual punishment, and under Miss.Code Ann. § 11-7-13 (Supp.1984) for wrongful death.

MOTION TO DISMISS OF RILEY AND TAYLOR

(a) 42 U.S.C. § 1983

The plaintiff alleges that Riley and Taylor, the Chief Deputy Sheriff and Jailer respectively of DeSoto County, Mississippi, negligently deprived the decedent of his life, liberty, and property without due process of law and thus are liable under 42 U.S.C. § 1983. Parratt v. Taylor, 451 U.S. 527, 535, 101 S.Ct. 1908, 1913, 68 L.Ed.2d 420, 428 (1981) sets forth the two essential elements of a § 1983 action: (1) whether the conduct complained of is committed by a person acting under color of state law; and (2) whether such conduct deprives a person of rights, privileges, or immunities secured by the Constitution or laws of the United States. Id. In the present case, defendants Riley and Taylor concede that they acted under color of state law; accordingly, this court must focus on the second requirement.

Parratt v. Taylor, 451 U.S. at 537, 101 S.Ct. at 1913-14, 68 L.Ed.2d at 430, emphasizes that a mere deprivation of property is not sufficient for a § 1983 action; rather, the deprivation must be without due process. Although due process generally requires a meaningful predeprivation hearing, an adequate postdeprivation hearing is sufficient in cases wherein the former is impractical. Id. at 538-41, 101 S.Ct. at 1914-16, 68 L.Ed.2d at 430-32. Predeprivation process obviously is impractical when the taking is the result of random and unauthorized conduct, whether such actions are negligent, see id., 451 U.S. at 541, 101 S.Ct. at 1916, 68 L.Ed.2d at 432, or intentional, see Hudson v. Palmer, 468 U.S. 517, -, 104 S.Ct. 3194, 3204, 82 L.Ed.2d 393, 407 (1984). Therefore, if an adequate postdeprivation remedy exists in such cases, the deprivation does not constitute a procedural due process violation. Thibodeaux v. Bordelon, 740 F.2d 329, 337 (5th Cir.1984).

In the present case, the plaintiff alleges that his decedent was negligently deprived of life, liberty, and property without due process, and that such deprivation constitutes a violation of 42 U.S.C. § 1983. Since the alleged deprivations were caused by negligent acts and omissions, the existence of postdeprivation remedies must be examined. Adequate relief exists under state law with regard to all alleged deprivations, see Miss.Code Ann. § 11-7-13 (Supp. 1984) (wrongful death statute); accordingly, the plaintiff cannot maintain a procedural due process action under 42 U.S.C. § 1983. The defendants’ motion to dismiss on this ground is well taken and should be granted.

(b) U.S. Const, amend VIII

U.S. Const. amend. VIII protects only those convicted of a crime, see Ingraham v. Wright, 430 U.S. 651, 664, 667, 671-72, 97 S.Ct. 1401, 1408-10, 1412-13, 51 L.Ed.2d 711, 724-25, 727-28 (1977), which does not include the decedent in the present case. Accordingly, the plaintiff cannot prevail on this claim and the defendants’ motion to dismiss should be granted.

(c) Miss.Code Ann. § 11-7-13

The plaintiff, a Tennessee resident, has asserted a wrongful death cause of action under Miss.Code Ann. § 11-7-13 (Supp.1984). There appears to be complete diversity of citizenship of the parties, see Strawbridge v. Curtiss, 7 U.S. (3 Cranch) 267, 2 L.Ed. 435 (1806), rev’d. on other grounds, Louisville, Cincinnati & Charleston Railroad Co. v. Letson, 43 U.S. (2 How.) 497, 11 L.Ed. 353 (1844) (requirement that all parties on one side of suit be citizens of different state than all parties on other side), and the amount in controversy exceeds $10,000.00; therefore, this cause of action appears proper. 28 U.S.C. § 1332(a) (1966). The defendants contend that the appointment of plaintiff as administrator violates Miss.Code Ann. § 91-1-27 (1972) (designation of heirs at law of intestate in chancery court of county in which decedent had realty; decedent in present case had only personalty), and that diversity jurisdiction should not exist. The defendants may be correct in asserting that the appointment was improper, but cf. Miss.Code Ann. § 91-7-63 (1972) (appointment of administrator by chancery court of county wherein intestate had personalty if intestate had no fixed residence); however, such appointment should be attacked in the Chancery Court of DeSoto County, Mississippi, which court appointed the plaintiff as administrator. Accordingly, the defendants’ motion to dismiss on this ground is not well taken and should be denied.

MOTION TO DISMISS OF SUPERVISOR DEFENDANTS

The supervisor defendants are sued only in their official capacity as members of the Board of Supervisors. Although suit under 42 U.S.C. § 1983 against persons in their official capacity is merely an alternative form of pleadings such suit against that entity, see Monell v. Department of Social Services, 436 U.S. 658, 690 n. 55, 98 S.Ct. 2018, 2036 n. 55, 56 L.Ed.2d 611, 635 n. 55 (1978); Van Ooteghem v. Gray, 628 F.2d 488, 496 (5th Cir.1980), it is the rule in this circuit that the municipal or government entity must also be joined as a defendant in a § 1983 suit in order for liability to be imposed. Hart v. Walker, 720 F.2d 1443, 1445 (5th Cir.1983). The plaintiff therefore has not stated a cause against the supervisor defendants upon which relief can be granted; therefore, the motion to dismiss is well taken and should be granted. Fed.R.Civ.P. 12(b)(6).

Let an order issue accordingly.

      . The plaintiff alleges deprivations of life, liberty, and property; however, the thrust of his complaint appears to concern only wrongful deprivation of life.

      . Most case law concerning postdeprivation remedies has dealt either with deprivations of property, see, e.g., Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981) (deprivation of hobby kit), or liberty, see, e.g., Thibodeaux v. Bordelon, 740 F.2d 329 (5th Cir.1984) (negligent incarceration); however, this court perceives no reason why a different standard should apply to a deprivation of life. See State Bank of St. Charles v. Camic, 712 F.2d 1140, 1147 (7th Cir.1983), cert. denied, 464 U.S. 995, 104 S.Ct. 491, 78 L.Ed.2d 686 (1983) (application of Parratt to alleged deprivation of life); Meshkov v. Abington Township, 517 F.Supp. 1280, 1285-86 (E.D.Pa.1981) (same).


author: McGARR, Chief Judge.

text:
    TRAK MICROCOMPUTER CORPORATION, and Dr. Prem S. Chopra, Plaintiffs, v. WEARNE BROTHERS, et al., Defendants.
    No. 84 C 7970.
    United States District Court, N.D. Illinois, E.D.
    Oct. 25, 1985.

      Louis P. Buffardi, Oak Brook, Ill., John W. Conniff, Chicago, Ill., for plaintiffs.
    David L. Schiavone, James T. Nyeste, Wildman, Harrold, Allen & Dixon, Chicago, Ill., H. Van Sinclair, George R. Kucik, Arent, Fox, Kintner, Plotkin & Kahn, Washington, D.C., for defendants.
   MEMORANDUM OPINION AND ORDER

McGARR, Chief Judge.

Plaintiffs Trak Microcomputer Corporation (“Trak”) and Dr. Prem S. Chopra bring this action against defendants Wearne Bros. (“Wearne”), Wearnes (USA), Inc. (“Wearnes USA”), Wearnes Technology Pvt. Ltd. (“Wearnes Tech”), and Weltec Digital, Inc. (“Weltec”). Wearnes USA and Weltec have filed a counterclaim against Trak, Chopra, and James M. Rehnquist (even though the counterclaim, insofar as it applies to Rehnquist, who is not a plaintiff in this action, should be captioned a third-party complaint, it will hereinafter be referred to as the “counterclaim” and Rehnquist will be referred to as a counter-defendant). This cause is before this court on plaintiffs’ motion for an order compelling Wearnes Tech to answer, the motion of the counterdefendants to dismiss the counterclaim, and defendants’ motion to dismiss various aspects of plaintiffs’ amended complaint.

Plaintiffs’ Motion For an Order to Compel Wearnes Tech to Answer

Plaintiffs contend that Wearnes Tech, a Singapore corporation, was served with the complaint and summons in Singapore by mail, pursuant to Fed.R.Civ.P. 4(i)(1)(D). Rule 4(i)(l)(D) permits service in a foreign country to be made by any form of mail requiring a signed receipt, addressed and dispatched by the Clerk of the Court to the party to be served. Plaintiffs assert, and it is not disputed, that a summons and complaint were mailed to Wearnes Tech by the Clerk, return receipt requested. The summons and complaint, however, were returned to the Clerk. The envelope in which they had been sent was marked in a manner which reflected that the reason for the non-delivery of the package was that the package was refused. The package does not indicate by whom or for what reason the package was refused.

Rule 4(i)(2) provides that proof of service made pursuant to Rule 4(i)(l)(D) shall include a receipt signed by the addressee or other evidence of delivery to the addressee satisfactory to the court. By memorandum opinion and order dated February 15, 1985 (the “memorandum opinion”), this court granted Wearne Tech’s motion to dismiss on the basis that it had not been effectively served. This court held that Trak had not provided any proof of delivery to Wearnes Tech; Trak did not produce a receipt signed by the addressee or any other proof of delivery. Memorandum opinion at p. 8.

This court now finds, based on the evidence before it, that plaintiffs have presented sufficient evidence of delivery of the summons and complaint to satisfy Rule 4(i)(2). The manner in which the returned envelope was marked suggests that actual delivery of the summons and complaint was made to Wearnes Tech. On the envelope, the Postal Service provided a space for the mail carrier to mark the reason for not delivering the package. The possible reasons for non-delivery were “gone away,” “no such name,” “no such number,” or “refused.” The mail carrier only marked “refused.” It is reasonable to infer from this mark that the summons and complaint were delivered to Wearnes Tech at the address specified by the Clerk, but, for some unknown reason, a person who apparently spoke on behalf of Wearnes Tech refused to accept the package.

In addition to the evidence before this court which suggests that delivery of the summons and complaint was made on Wearnes Tech, this court also notes that Wearnes Tech has actual notice of the case at bar. Appearances have been filed by attorneys on behalf of Wearnes Tech. Thus, there is no danger that Wearnes Tech has not received notice of this action.

In light of the circumstances of this case, this court finds that sufficient proof of delivery of the summons and complaint has been made to satisfy Rule 4(i)(2). Wearnes Tech is ordered to file an answer to plaintiffs’ amended complaint within 20 days.

Plaintiffs’ Motion to Dismiss the Counterclaim

The counterclaim against Trak, Chopra, and Rehnquist seeks to recover damages allegedly resulting from the counterdefendants’ fraud and misrepresentations. The counterclaim alleges Chopra and Rehnquist were seeking an investor or partner to pour cash into Trak, which was experiencing financial difficulties. To that end, Chopra and Rehnquist initiated meetings in Singapore which led to discussions in May through August of 1984, between Weltec and Wearnes USA on the one hand and the counterdefendants on the other. Wearnes USA and Weltec allege that during these discussions, counterdefendants made a series of false representations and material omissions in order to induce Wearnes USA and Weltec to pursue negotiations with Trak.

Specifically, the counterclaim alleges that the counterdefendants falsified Trak’s March 31, 1984 financial statements, failed to disclose Trak’s business decline after March 31, failed to disclose problems with certain Trak products, and submitted other financial projections, marketing plans, and brochures which described Trak’s future in misleading glowing terms. Wearnes USA and Weltec allegedly relied upon the fraudulent misrepresentations and were misled by the material omissions, incurring damages in connection with their good faith negotiations and by pursuing the Trak venture to the exclusion of others.

Counterdefendants contend that the counterclaim should be dismissed because it fails to state the circumstances of the alleged fraud with the particularity required by Rule 9(b). Rule 9(b) requires a complaint for fraud to allege facts concerning the time period of the alleged misrepresentations, the nature of the alleged misrepresentations, and the individuals involved. Chicago Heights Venture v. Dynamit Nobel of America, Inc., 575 F.Supp. 214, 220 (N.D.Ill.1983). Although the allegations of fraud must be concrete and particularized enough to give notice to the defendants of the conduct complained of to enable the defendants to prepare a defense, Rule 9(b) does not require the plaintiff to plead evidentiary matters. D & G Enterprises v. Continental Illinois National Bank & Trust Co. of Chicago, 574 F.Supp. 263, 267 (N.D.Ill.1983).

This court finds that the counterclaim alleges fraud with sufficient particularity to withstand a motion to dismiss. The allegations notify the counterdefendants of the general time period in which the alleged misrepresentations were made. In addition, the allegations set forth the content of the alleged misrepresentations and the nature of the material which the counterdefendants omitted to reveal to Weames USA and Weltec. Finally, the allegations identify the persons who made the alleged misrepresentations. Because the allegations are sufficient to state a cause of action for fraud under Rule 9(b), counterdefendants’ motion to dismiss the counterclaim is denied.

Chopra and Rehnquist contend that the- counterclaim must nevertheless be dismissed as to them because it does not allege that they made any misrepresentations or material omissions as individuals. Rather, it merely alleges that they acted as officers and agents of Trak. It does not come as a surprise to this court that they fail to cite any authority in support of their argument. The law clearly holds a corporate officer individually liable for the fraudulent acts in which he participates. Citizens Savings & Loan Association v. Fischer, 67 Ill.App.2d 315, 322, 214 N.E.2d 612, 615 (5th Dist.1966). The counterclaim alleges Chopra and Rehnquist participated in the fraud. Hence, the counterclaim states a cause of action against them.

Motion to Dismiss Amended Complaint

Weame moves for the dismissal of the amended complaint on the ground that this court does not have jurisdiction over it. In the memorandum opinion, this court dismissed Weame on that basis because this court found that plaintiff failed to carry its burden of establishing a prima facie showing that the court had jurisdiction over Wearne. First, Trak failed to present to the court any contacts which Weame had with Illinois. Second, even though Trak argued that the jurisdictional acts of Weltec and Wearnes Tech, Wearnes’ subsidiaries, should be imputed to Weame, Trak failed to set forth any reason for this court to ignore the separate corporate existence of Wearne and its subsidiaries.

In the amended complaint, plaintiffs allege, upon information and belief, that Wearne controls Wearnes USA, Weltec, and Wearnes Tech by virtue Of stock holdings, management control, and influence in the day-to-day operation of the companies. Specifically, plaintiffs allege, upon information and belief, that Weame controlled Wearnes USA, Weltec, and Weames Tech by, inter alia, intermingling business transactions and records, not maintaining corporate formalities, and inadequately financing its subsidiaries. In short, plaintiffs allege Wearne is the alter ego of its subsidiaries and should be held responsible for their acts, including their acts in Illinois which give rise to this court’s jurisdiction over the subsidiaries.

Weame argues that plaintiffs’ amended complaint should be dismissed because this court already rejected Trak’s alter ego argument in the memorandum opinion. This court, however, did not categorically reject the contention that Wearne may be liable for the acts of its subsidiaries as their alter ego, but merely held that plaintiff had not demonstrated any basis for this court to find that Weame was the alter ego of its subsidiaries.

Taking plaintiffs’ allegations as true, which this court must do on a motion to dismiss, this court finds that plaintiffs allege a basis for this court to have jurisdiction over Wearne. Plaintiffs allege circumstances under which Weame might be found to be the alter ego of its subsidiaries. That is not to say that this court finds that Wearne is the alter ego of its subsidiaries. Rather, this court only holds that plaintiff has alleged a sufficient basis for this court to permit plaintiff to engage in discovery concerning the relationship between Wearne and its subsidiaries. This court will not determine whether it has jurisdiction over Wearne on the basis of the alter ego doctrine until the facts regarding the relationship between Wearne and its subsidiaries are before this court.

Defendants next attack Count VII of the amended complaint, which purports to state a cause of action under the Racketeer Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1961-1968. Count VII alleges that the defendants Wearne, Weames USA, Weltec, and Wearnes Tech constitute an enterprise within the meaning of § 1961(4). It further alleges that each of the four defendants are persons within the meaning of § 1961(3). Plaintiffs then allege that the four defendants have been employed or associated with the enterprise by a pattern of racketeering activity and each has conspired to violate §§ 1962(b) and (c). Plaintiffs also allege that the defendants committed at least two acts of mail fraud and wire fraud in furtherance of their scheme to defraud plaintiffs. The alleged fraudulent scheme was the defendants’ creation of the appearance of good faith contract negotiations supposedly aimed at legitimately obtaining microcomputer technology while failing to disclose that they had no interest in honoring any agreement. The alleged objective of the fraudulent scheme was to obtain the disclosure of valuable competitive information without paying for it.

Defendants first attack Count VII on the ground that plaintiffs’ fraud allegations fail to state a claim because plaintiffs merely allege reliance on statements regarding future actions, not misrepresentations of past or present fact. This court dismissed Trak’s original fraud claim because it merely alleged that Trak had relied on defendants’ statements regarding their future actions. Memorandum opinion at p. 10.

The fraudulent scheme alleged in Count VII differs, however, from the fraud count Trak alleged in its original complaint. Plaintiffs now allege that defendants’ false representations of their intentions regarding their future conduct were the scheme by which the defendants accomplished their fraud. As such, the allegations fall within the scope of Carroll v. National Bank of Lincolnwood, 413 F.2d 353, 358 (7th Cir.1969), where the court recognized that even though false representations regarding future conduct cannot state a cause of action for fraud generally, they may sustain a cause of action for fraud where the representations regarding future conduct are claimed to be the scheme used to accomplish the fraud.

Defendants next assert that plaintiffs’ allegations of mail and wire fraud are not pled with the requisite particularity. Plaintiffs specifically identify one mailing, the Stock Purchase and Sale agreement, which was made pursuant to the defendants’ alleged scheme, and further identify the contents of that mailing and the identity of the person from whom it originated. In addition, plaintiffs allege that a number of phone calls were made pursuant to the scheme. Plaintiffs provide the general time frame in which these calls were made and the nature of the content of the calls.

In order to hold an individual liable for mail fraud, it must merely be shown that the defendant participated in a scheme to defraud in which the use of the mails was foreseeable. United States v. Hasenstab, 575 F.2d 1035, 1039 (2d Cir.1978), cert. denied, 439 U.S. 827, 99 S.Ct. 100, 58 L.Ed.2d 120 (1979). Plaintiffs have met this standard with respect to both their mail fraud and wire fraud allegations. In addition, the plaintiffs’ description of the fraudulent scheme and their identification of the transactions by which the scheme was accomplished put defendants on fair notice of the time and place of the alleged false representations. See Haroco v. American National Bank & Trust Co., 747 F.2d 384, 405 (7th Cir.1984), aff'd, — U.S. -, 105 S.Ct. 3291, 87 L.Ed.2d 437 (1985).

Defendants next argue that plaintiffs fail to adequately allege an “enterprise” within the meaning of RICO. First, defendants contend that a group of corporations cannot be an “enterprise” within the meaning of § 1961(4). Section 1961(4) provides that 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. Although a group of corporations associated in fact is not expressly listed in § 1961(4), that section is not an exclusive list; it merely lists entities which are included in the RICO definition of “enterprise.” Thus, a group of corporations can constitute a RICO “enterprise.” United States v. Huber, 603 F.2d 387, 393-94 (2d Cir.1979), cert. denied, 445 U.S. 927, 100 S.Ct. 1312, 63 L.Ed.2d 759 (1980). See also Bunker Ramo Corp. v. United Business Forms, Inc., 713 F.2d 1272, 1285 (7th Cir.1983) (an enterprise includes the entities listed in § 1961(4) or any combination of them).

Second, defendants argue that a RICO “enterprise” must be a separate entity from the RICO defendants. In Haroco, the Seventh Circuit recognized § 1962(c) required that the liable person and the enterprise which has its affairs conducted through a pattern of racketeering activity must be separate entities. Haroco, 747 F.2d at 400. Plaintiff has pled as much. The alleged enterprise is the association in fact of the four corporate defendants and the alleged liable persons are each of the four individual corporate defendants. Thus, the persons allegedly liable for the § 1962(c) violation are distinct entities from the alleged enterprise. This conclusion is consistent with the Haroco court’s observation that in the association in fact situation, each participant in the enterprise may be a person liable under RICO, whereas the association itself cannot be liable. Id. at 401.

Defendants finally challenge plaintiffs’ RICO claim on the basis that it fails to allege a “pattern of racketeering activity.” As with many of the terms used in the RICO statute, the statute itself provides a definition. Section 1961(1) defines “racketeering activity” as any one of a number of specified illegal acts, including mail fraud and wire fraud. Section 1961(5) provides that “a pattern of racketeering activity” requires at least two acts of racketeering activity, one of which occurred after the effective date of the statute and the last of which occurred within 10 years after the commission of a prior act of racketeering activity.

Defendants ask this court to find that plaintiffs have failed to allege “a pattern of racketeering activity” in light of the rationale of National Trust Bank/O’Hare N.A. v. Inryco, Inc., 615 F.Supp. 828 (N.D.Ill.1985), wherein Judge Shadur explored the “pattern” component of a RICO claim. Judge Shadur began by examining language found in the recent Supreme Court case of Sedima, S.P.R.L. v. Imrex Co., — U.S. -, 105 S.Ct. 3275, 87 L.Ed.2d 346 (1985), where the Supreme Court suggested that one of the reasons for the “extraordinary” uses to which civil RICO has been put is the failure of the courts to develop a meaningful concept of “pattern.” Sedima, 105 S.Ct. at 3287. The Court stated:

As many commentators have pointed out, the definition of a “pattern of racketeering activity” differs from the other provisions in § 1961 in that it states that a pattern “requires at least two acts of racketeering activity,” § 1961(5) (emphasis added), not that it “means” two such acts. The implication is that while two acts are necessary, they may not be sufficient. Indeed, in common parlance, two of anything do not generally form a “pattern.” The legislative history supports the view that two isolated acts of racketeering activity do not constitute a pattern. As the Senate Report explained: “The target of [RICO] is thus not sporadic activity. The infiltration of legitimate business normally requires more than one ‘racketeering activity’ and the threat of continuing activity to be effective. It is this factor of continuity plus relationship which combines to produce a pattern.” S.Rep. No. 91-617, p. 158 (1969) (emphasis added). Similarly, the sponsor of the Senate bill, after quoting this portion of the Report, pointed out to his colleagues that “[t]he term ‘pattern’ itself requires the showing of a relationship____ So, therefore, proof of two acts of racketeering activity, without more, does not establish a pattern____” 116 Cong.Rec. 18940 (1970) (statement of Sen. McClellan). See also id., at 35193 (statement of Rep. Poff) (RICO “not aimed at the isolated offender”); House Hearings, at 665. Significantly, in defining “pattern” in a later provision of the same bill, Congress was more enlightening: “criminal conduct forms a pattern if it embraces criminal acts that have the same or similar purposes, results, participants, victims, or methods of commission, or otherwise are interrelated by distinguishing characteristics and are not isolated events.” 18 U.S.C. § 3575(e). This language may be useful in interpreting other sections of the Act. Cf. Iannelli v. United States, 420 U.S. 770, 789, 95 S.Ct. 1284, 1295, 43 L.Ed.2d 616 (1975). Sedima, 105 S.Ct. at 3285 n. 14.

Based upon his reading of this language in Sedima, Judge Shadur rejected the Seventh Circuit precedent which found the “pattern” element of RICO to be satisfied by the presence of at least two acts of “racketeering activity” taken in furtherance of a single criminal end. See, e.g. United States v. Starnes, 644 F.2d 673, 677-78 (7th Cir.1981); United States v. Weatkerspoon, 581 F.2d 595, 601-02 (7th Cir.1978). Judge Shadur held that the “continuity plus relationship” formula from Sedima required that plaintiff allege more than two acts of “racketeering activity”— there, the mailing of a subcontract and the mailing of a kickback check — to establish a “pattern.” Judge Shadur further observed, even though he need not decide the issue, that even if three additional kickback payments involved the mails, they still implemented the same fraudulent scheme— and the single scheme does not represent the necessary “pattern of racketeering activity.” 105 S.Ct. at 3281.

This court agrees with Judge Shadur’s analysis of RICO and Sedima insofar as it states that more than a mere counting of “racketeering activity” is necessary to determine whether a “pattern of racketeering activity” has been stated. The criminal acts must demonstrate both a continuity and a relationship. However, this court does not agree with the suggestion that a “pattern of racketeering activity” cannot be established with respect to a single fraudulent scheme.

In determining the meaning of a “pattern of racketeering activity,” this court is bound to the language of the RICO statute. That act defines what a “racketeering activity” is. The act does not suggest that a “pattern of racketeering activity” means a pattern of fraudulent schemes; it merely requires a pattern of “racketeering activity.” Sedima does not compel a contrary interpretation. Nothing in the language of Sedima suggests that in order to find a “pattern of racketeering activity” a pattern of fraudulent schemes must be pled. Rather, Sedima only requires that the racketeering activity be continuous and related.

This court finds that plaintiffs have alleged a “pattern of racketeering activity.” Plaintiffs allege that defendants engaged in numerous acts of “racketeering activity” which were continuous over an identified period of time and which were related to one another in furtherance of the alleged fraudulent scheme. These allegations satisfy the continuity plus relationship standard of Sedima.

This court finds that plaintiffs have pled a cause of action under RICO. This court recognizes, however, the ease with which one can state a cause of action under the liberal pleading rules in federal court. In the event plaintiffs’ cause of action is subsequently found to be not well-grounded in fact, this court will impose appropriate sanctions.

Defendants next seek the dismissal of Count VIII which alleges Wearnes USA and Wearnes Tech, as majority shareholders of Trak, entered into an employment agreement with Chopra which has allegedly been breached. Defendants first attack this count by arguing that the amended complaint has not alleged that Wearnes USA or Wearnes Tech are shareholders of Trak. This argument ignores plaintiffs’ allegation that the employment agreement stemmed from defendants’ “status as a majority shareholder of Trak.” Whether or not that allegation is true is not a determination appropriate for resolution on a motion to dismiss.

Defendants next argue that even if Wearnes USA was a majority shareholder of Trak, it would not have the authority to unilaterally enter into contracts on behalf of the company because the powers of management are vested in the board of directors, Ill.Rev.Stat. ch. 32, § 8.05. However, the selection of corporate officers is not a task reserved solely for the board of directors. See id. at § 8.50 (officers may be elected or appointed by the board of directors or in such manner as may be prescribed by the by-laws).

Defendants’ final argument for dismissing Count VIII is also without merit. Defendants contend that the agreement would only reaffirm Chopra’s continued position with Trak. This argument does not, however, address whether or not plaintiffs have stated a cause of action for breach of contract. Defendants’ motion to dismiss Count VIII is denied.

Because of this court’s ruling with respect to plaintiffs’ motion to compel Wearnes Tech to answer, Wearnes Tech’s motion to dismiss plaintiffs’ amended complaint for insufficiency of process is denied.

In sum, plaintiffs’ motion to compel Wearnes Tech to answer is granted, counterdefendants’ motion to dismiss the counterclaim is denied, and the defendants’ motion to dismiss portions of plaintiffs’ amended complaint is denied.