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RICK NOLAN'S AUTO BODY SHOP v. ALLSTATE INS. CO.

May 11, 1989

RICK NOLAN'S AUTO BODY SHOP, INC., an Illinois corporation; and RICHARD T. NOLAN, Plaintiffs,
v.
ALLSTATE INSURANCE COMPANY, an Illinois corporation, Defendant



The opinion of the court was delivered by: BUA

 NICHOLAS J. BUA, UNITED STATES DISTRICT JUDGE

 Plaintiffs in this action filed suit under 42 U.S.C. sections 1981 and 1982 against defendant Allstate Insurance Company ("Allstate"). In response to plaintiffs' allegations, Allstate has filed a motion to dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons stated herein, Allstate's motion to dismiss is granted in part and denied in part.

 FACTS

 Plaintiff Richard T. Nolan is the sole shareholder, president, and manager of plaintiff Rick Nolan's Body Shop, Inc. ("Nolan's Body Shop"), an Illinois corporation doing business as a motor vehicle body repair shop. In 1984, plaintiffs entered into an agreement with Allstate whereby Allstate designated Nolan's Body Shop as a "direct repair" shop for the damaged vehicles of Allstate's insureds. Under Allstate's direct repair program, an Allstate insured can bring his damaged vehicle to any designated direct repair shop for both appraisal and repair of damages. In this manner, the insured can avoid the delay caused by waiting for an Allstate claims adjuster to review the damaged vehicle and approve the necessary repairs. Thus, as an Allstate direct repair shop, Nolan's Body Shop could provide body repair service more quickly and conveniently to Allstate insureds.

 Nolan's Body Shop maintained its designation as an Allstate direct repair shop until March 30, 1985, at which time Allstate terminated the designation. *fn1" According to the amended complaint, Allstate informed plaintiffs that the designation of Nolan's Body Shop was being terminated because the body shop was located outside the permitted location for designated direct repair shops in the area. However, plaintiffs allege that the true reason for the termination is racial discrimination on the part of Allstate. Plaintiffs maintain that Allstate terminated the direct repair shop status of Nolan's Body Shop for the sole reason that Richard T. Nolan and all others operating Rick Nolan's Body Shop are black. Plaintiffs allege that such racial discrimination constitutes a violation of their civil rights and forms a basis for their claims under sections 1981 and 1982.

 DISCUSSION

 Allstate's motion to dismiss challenges both claims in plaintiffs' amended complaint. With respect to plaintiffs' § 1982 claim, Allstate argues that plaintiffs fail to allege a property interest protected under § 1982. Regarding plaintiffs' § 1981 claim, Allstate maintains that plaintiffs failed to raise the claim within the applicable statute of limitations. Therefore, Allstate requests the court to dismiss the amended complaint in its entirety.

 I. Plaintiffs' § 1982 Claim

 Section 1982 provides:

 
All citizens of the United States shall have the same right, in every State and Territory, as is enjoyed by white citizens thereof to inherit, purchase, lease, sell, hold and convey real and personal property.

 To state a claim under § 1982, a party must allege an impairment of the type of property interest protected by the statutory language. City of Memphis v. Greene, 451 U.S. 100, 123-24, 67 L. Ed. 2d 769, 101 S. Ct. 1584 (1981). Since § 1982 only protects real and personal property interests, numerous courts have held that § 1982 does not apply to employment discrimination claims. See Schirmer v. Eastman Kodak Co., 1987 U.S. Dist. LEXIS 2800, No. 86-3533 (E.D. Pa. April 9, 1987), aff'd, 869 F.2d 591 (3d Cir. 1989); Jurado v. Eleven-Fifty Corp., 630 F. Supp. 569, 572 (C.D. Cal. 1985), aff'd, 813 F.2d 1406 (9th Cir. 1987); Abel v. Bonfanti, 625 F. Supp. 263, 269 (S.D.N.Y. 1985); Tate v. Hills-McCanna Co., 42 Fair Empl. Prac. Cas. (BNA) 138, 29 Empl. Prac. Dec. (CCH) para. 32,944 at 26,463 (N.D. Ill. June 16, 1982); Johnson v. Duval County Teachers Credit Union, 507 F. Supp. 307, 310 (M.D. Fla. 1980). The basis for these holdings is that employment rights are not "property" within the meaning of § 1982. See Schirmer, supra. Therefore, an employee cannot sue his employer under § 1982 to enforce a purported "right to labor." See Tate, supra.

 Although the instant case does not involve an employment discrimination claim, it presents an analogous situation. Essentially, the amended complaint alleges that when Allstate designated Nolan's Body Shop as a direct repair shop, Allstate authorized plaintiffs to act as Allstate's agents. Plaintiffs argue that the creation of this agency relationship gave them a property interest in the designation of Nolan's Body Shop as a direct repair shop. In other words, plaintiffs claim they held a property interest in their status as Allstate's agents. Plaintiffs' suit seeks to enforce their alleged right to maintain their agency status.

 The court finds that plaintiffs never held a property interest protected by § 1982. Plaintiffs' purported interest in their status as Allstate agents is not protected by § 1982 for the same reason that an employee's interest in his status as an employee is not protected under § 1982. Such "interests" are simply not the type of real or personal property interests on which a § 1982 claim ...


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