Cause No. IP99-0276-C-M/S
September 29, 2000
ORDER ON MOTION TO DISMISS
Plaintiffs Robert and Judy Willits (the "Willits") filed an amended complaint adding Wal-Mart employees Sandy Woodard, Kevin Grizzle, Greg Ledbetter, Jeff Dunn, Wendell Steen, Tom DeWitt, Bill Jeffries, Mike McCarthy, Steve Hackmeyer, and Amy Workmen ("Workers") as defendants to this proceeding. The Workers have filed a Rule 12(b)(6) motion to dismiss, claiming that the Willits' claims against them are time-barred. The Willits have also filed a motion requesting the Court to convert the motion to dismiss to a motion for summary judgment. The Court has fully considered the parties' arguments and, for the reasons discussed below, GRANTS the Workers' motion to dismiss. The Court DENIES the Willits' motion to convert the Workers' motion to a motion for summary judgment.
On July 24, 2000 the Court allowed the Willits leave to file additional information within 10 days from receiving the deposition transcripts of Indiana State Police officers. The Court also agreed to stay ruling on the Workers' motion until the names of all Wal-Mart employees have been disclosed. Over two months have elapsed since that Order, and the Willits have submitted no additional information in support of their opposition. Accordingly, the Court finds the Workers' motion is ripe for ruling.
I. FACTS AND PROCEDURAL HISTORYThe Willits owned and operated a bait and tackle shop in Greenfield, Indiana. (Pl.'s Amended Complaint ¶ 9). Tim Sculling, who sometimes sold items to the Willits for resale in the tackle shop, was caught stealing from Wal-Mart. (Id. ¶¶ 11, 13). Sculling then became an informant for the Indiana State Police and assisted them in a sting operation. (Id. ¶ 15). During the sting operation, Sculling allegedly sold stolen goods that had been marked with ultraviolet liquid to the Willits' son in exchange for cash and controlled substances. (Id. ¶ 16). As a result of a sting operation, Hancock Superior Court II issued a search warrant authorizing the search of the tackle shop and seizure of fishing tackle or related items, either stolen or purported to be stolen. (Id. ¶ 19). On September 17-18, 1997, the Workers participated with the Indiana State Police in the execution of a search warrant at the Willits' Tackle Town. (Id. ¶ 20). The execution of the warrant began at approximately 11:00 p.m. on September 17 and continued until approximately 1:30 a.m. on September 18th. (Id. ¶ 21). The Workers resumed the seizure at approximately 8:30 a.m. on September 18th and concluded it later that same day. According to the Willits, the collection of inventory by the Indiana State Police and Workers resulted in the deliberate seizure of property that the warrant had not authorized to be seized. (Id. ¶¶ 23, 24). The Willits also allege that fishing-related merchandise and business records were illegally seized from their garage in violation of Judy Willits' Consent to Search. According to the Willits, the collection of inventory by the Indiana State Police and Workers resulted in the deliberate seizure of property that the warrant had not authorized to be seized. (Id. ¶¶ 26-30).
In a hearing on October 31, 1997 in Hancock County Superior Court No. 2, Judge Richard Culver denounced all searches as far exceeding what was authorized by the terms of the warrant. According to the Willits, the collection of inventory by the Indiana State Police and Workers resulted in the seizure of property that the warrant had not authorized to be seized. (Id. ¶ 33). Although the search warrant was only for very specific items of property which were previously marked with ultraviolet liquid or bar codes in the sting operation, approximately 94,000 pieces of property were seized. For example, some of the illegally-seized property included unopened boxes that appeared to be shipped directly from manufactures, and were clearly not Wal-Mart products. (Id. ¶ 34).
The Willits allege that Judge Culver ordered the property to be returned and that defendants did not return it until November 24, 1997. They also claim that a considerable amount of their property was either returned in a damaged condition or not returned at all. The Willits cite to an affidavit of David L. Sylvester for these factual assertions, but they did not attach the affidavit to their opposition brief or their surreply brief. Accordingly, the Court will not consider these alleged facts. The Court notes that if it had considered any affidavits, it would have converted the Workers' motion to a motion for summary judgment under Fed.R.Civ.P. 56.
The Willits alleged that the actions of the Workers constituted an unlawful search and seizure in violation of the Fourth and Fourteenth Amendments to the United States Constitution. (Id. ¶ 49).
The Willits allege that during the seizure the Workers did not maintain adequate inventory controls over the seized merchandise. (Id. ¶ 59). The Willits claim that much of the merchandise was either damaged or not returned, and that such conduct constitutes the tort of conversion. (Id. ¶ 58).
The Willits also claim that the Workers owed a duty of care to conduct a lawful search and seizure within a reasonable time frame and within the bounds of the law. (Id. ¶ 67). The Willits allege that the Workers breached this duty and committed the tort of interference with a prospective business advantage. (Id. ¶¶ 68, 75). Additionally, the Willits claim that the Workers illegally seized their property in violation of Indiana common law and unspecified statutory law. (Id. ¶ 83).
When the Willits filed their initial complaint on March 4, 1999, they listed "unnamed John Doe Wal-Mart employees whose names are currently unknown to the Plaintiffs." The Willits believed 32 Wal-Mart employees were delegated a traditional state function of search and seizure. (Id. ¶¶ 6-7). In April 1999 the Willits served defendant Wal-Mart with their first set of interrogatories. Wal-Mart answered those interrogatories in August 1999. In its answers, Wal-Mart identified the Workers as employees that were involved in the allegations contained in the Willits' complaint. (Pl.'s Unopposed Motion for Leave to File Amended Complaint ¶¶ 5, 7, 8). Prior to that time, the names of those employees were unknown to the Willits. (Id. ¶ 2). On October 1, 1999, counsel for defendants agreed to allow the Willits until November 1, 1999 to amend the pleadings and/or to add additional parties. (Id. ¶ 4). The Willits filed their Unopposed Motion for Leave to Amend the Complaint on November 1, 1999. This Court granted the motion and the Willits filed their amended complaint on November 4, 1999. In the amended complaint the Willits added the Workers as defendants. The Workers have filed a Rule 12(b)(6) motion to dismiss because, according to the Workers, the claims are time-barred.
The Willits have filed a motion to convert the Workers' motion to dismiss to a motion for summary judgment under Fed.R.Civ.P. 56. If the court considers matters outside the pleadings when deciding a Rule 12(b)(6) motion to dismiss, the Court should treat the motion as one for summary judgment. Ninth Avenue Remedial Group v. Allis-Chalmers Corp., 195 B.R. 716, 721 (N.D.Ind. 1996). Courts can take judicial notice of matters of public record, however, without converting a motion to dismiss into a motion for summary judgment. Id., citing Henson v. C.S.C. Credit Services, 29 F.3d 280, 284 (7th Cir. 1994). Other than the amended complaint, the only documents the Court will consider in deciding this motion is the Willits' unopposed motion to amend their complaint and the appearances entered on behalf of the defendants. Because those documents are part of the public record, the Court will take judicial notice of them and refrain from converting this matter to a motion for summary judgment.
Federal Rule of Civil Procedure 12(b)(6) permits the dismissal of a claim for "failure to state a claim upon which relief may be granted." United States v. Clark County, Indiana, 2000 WL 1346851, *3 (S.D.Ind. September 18, 2000). When considering a motion under this rule, the Court must examine the sufficiency of plaintiffs' complaint, not the merits of the lawsuit. Id. Dismissal is appropriate only if it appears to a certainty that the plaintiffs cannot establish any set of facts which would entitle them to the relief sought. The Court shall accept as true all well-pleaded factual allegations and draw all reasonable inferences in favor of the plaintiff.
The parties are in agreement that all of the Willits' claims are subject to a two-year statute of limitations. The Willits assert several reasons, however, why their claims against the Workers should not be dismissed. The Court will now address those arguments.
A. ACCRUAL OF PLAINTIFFS' CLAIMS
The Willits first argue that their claims did not accrue until November 19, 1997, the date they first realized their property had been damaged or not returned at all. The Willits argue this is when they first learned they had been injured. As noted earlier, there is no evidence in the record of the date that the Willits' property was actually returned. The Willits refer to an affidavit by Mr. Sylvester, but it is not attached to any of their pleadings. Accordingly, the Court cannot consider this date and the Willits' argument is without merit. Even assuming the Willits did not learn until November that their property was damaged or had not been returned, however, this would not save their claim. Their claim accrued under federal law when they discovered they had been injured. Cada v. Baxter Healthcare Corp., 920 F.2d 446, 450 (7th Cir. 1991), cert. denied, 501 U.S. 1261 (1991). Similarly, their state law claims accrued when they knew, or in the exercise of ordinary diligence, could have discovered that an injury had been sustained as a result of the act of another. Doe v. United Methodist Church, 673 N.E.2d 839, 842 (Ind.App. 1997). The Willits' claims under Section 1983 and Indiana law therefore accrued no later than October 31, 1997, the date that they learned that the search and seizure of their property was unlawful.
The fact that they later learned that some of their property had been damaged has no effect on the accrual of their claim. Accordingly, unless the Willits can establish an equitable basis for modifying the statute of limitations, their claims against the Workers are time-barred.
B. EQUITABLE TOLLING
The Willits also argue that the statute of limitations should be tolled until August 12, 1999 because that is the date they first "became aware of the names of the person(s) who caused their injuries." Pl.'s Opposition Brief at 12. The doctrine of equitable tolling permits a plaintiff to avoid the bar of a statute of limitations if despite all due diligence he is unable to obtain vital information bearing on the existence of his claim. Cada, 920 F.2d at 451. Under this doctrine, it is assumed that the plaintiff knew he was injured — so that the statute of limitations has begun to run — but that he cannot obtain information necessary to decide whether the injury is due to wrongdoing, and if so, wrongdoing by the defendant. Id. In this case, the Willits knew they had been injured no later than October 31, 1997, and they additionally knew the identities of the Workers by August 12, 1999. Yet they did not file an amended complaint until November 4, 1999, well more than two months after learning the identities of the Workers. Under these circumstances, the Court concludes that the Willits have not shown that despite due diligence they could not obtain vital information bearing on the existence of their claims. Accordingly, the Court concludes they are not entitled to the benefit a tolling of the statute of limitations.
The Willits alternatively argue that the statute of limitations should have been tolled until November 19, 1997 because that is the date that they first learned a possible violation had occurred. The November 19, 1997 date is nowhere in the pleadings, however, so the Court will not consider this argument. In any event, it appears to be another way of arguing that their claim did not accrue until November 19, 1997, an argument that the Court has already rejected.
C. CONTINUING VIOLATIONThe Willits alternatively argue that they suffered from a continuing wrong that concluded upon the return of their property in November 1997. Again, there is no evidence in the record of the date that the property was allegedly returned, so the Court will not consider this argument. Even assuming that were the case, however, the Willits' claim would fail. The Seventh Circuit has defined a "continuing violation" as "one that could not reasonably have been expected to be made the subject of a lawsuit when it first occurred because its character as a violation did not become clear until it was repeated during the limitations period." See Dasgupta v. University of Wisc. Bd. of Regents, 121 F.3d 1138, 1139 (7th Cir. 1997). That is not the case here. The Willits were aware no later than October 1997 that the search and seizure of their property was actionable. Accordingly, the continuing violation doctrine is inapplicable.
D. INDEPENDENT CAUSES OF ACTION
The Willits attempt to salvage their claims by arguing that the state law claims of conversion and interference with a prospective advantage actually did not occur until November 19, 1997 when they realized their property had been damaged or not returned at all. They also argue that the defendants' failure to return their property in November 1997 constituted a separate claim of illegal seizure under Section 1983. Even assuming the failure to return property would constitute a separate tort or constitutional violation, there is no evidence that these actions occurred in November 1997. Accordingly, the Court will not consider this argument.
E. EQUITABLE ESTOPPEL
Finally, the Willits argue that tolling should apply because defendants are preventing them from discovering the identity of Wal-Mart employees that participated in the search and seizure and because the Workers' counsel had no objection to extending the deadline for amending the pleadings to add additional parties. The Willits also allege that the Workers' counsel agreed not to plead the statute of limitations as a defense. These allegations appear to be a claim for equitable estoppel, as opposed to equitable tolling.
Equitable estoppel comes into play if the defendant takes active steps to prevent the plaintiff from suing in time, such as by promising not to plead the statute of limitations. Cada, 920 F.2d at 450-451. In the limitations setting it is sometimes referred to a fraudulent concealment, which presupposes that the plaintiff has discovered or should have discovered that the defendant injured him, but that defendant has taken efforts above and beyond the wrongdoing upon which plaintiff's claim is founded to prevent the plaintiff from suing in time. Id. at 451.
The Willits point to Wal-Mart's and the State Police's conduct, as opposed to the Workers' conduct, in an effort to preclude the Workers from asserting a statute of limitations defense. There are no allegations, however, that the Workers did anything to hamper the Willits' ability to discover their identities or otherwise took active steps to prevent them from being able to sue in time. Without such evidence, the doctrine of equitable estoppel is inapplicable.
The Willits argue that Wal-Mart's failure to oppose a motion to amend the complaint to add additional parties somehow equated to a promise not to plead the statute of limitations as a defense. First, the Court does not agree that allowing a party to amend their complaint to add parties amounts to an agreement not to plead the statute of limitations or any other possible defense. In addition, the Workers were not even parties to this proceeding at the time the alleged agreement was made. Although counsel for Wal-Mart had entered an appearance on behalf of the unidentified Wal-Mart employees, the Court will not hold the Workers bound by any representations of Wal-Mart's counsel not made specifically on their behalf — prior to the filing of an appearance by Wal-Mart's counsel on their behalf. Similarly, the fact that Wal-Mart did not assert the statute of limitations as an affirmative defense in its answer does not mean that the Workers — who have yet to file an answer — somehow waived that defense.
The Court has considered only the pleadings and matters of which it could take judicial notice in deciding this motion. Accordingly, the Willits' motion to convert the Workers' motion to a motion for summary judgment is DENIED. The Court further finds that the Willits' claims against the Workers are untimely and GRANTS the Workers' motion to dismiss. The Willits' claims against the Workers are dismissed with prejudice.