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THOMAS G. PENNIE, Defendant.

The opinion of the court was delivered by: DAVID COAR, District Judge


Plaintiff United Parcel Service, Inc. ("UPS") has filed a complaint against defendant Thomas G. Pennie ("Pennie") pursuant to the Declaratory Judgment Act, 28 U.S.C. §§ 2201, et seq. ("the DJA"). In it, UPS requests a determination that Pennie is estopped by his wage differential settlement with UPS under § 8(d)(1) of the Illinois Workers Compensation Act, 820 ILCS 305/1, et seq. ("the IWCA"), from asserting any right to resume employment with UPS.

Pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, Pennie has moved to dismiss the complaint on several grounds. For the reasons set forth below, this court grants Pennie's motion to dismiss and dismisses UPS's complaint.

  I. Standards on a Rule 12(b)(6) Motion to Dismiss

  "The purpose of a motion to dismiss is to test the sufficiency of the complaint, not to decide the merits." Triad Assocs., Inc. v. Chicago Hous. Auth., 892 F.2d 583, 586 (7th Cir. 1989). In reviewing a motion to dismiss for failure to state a claim, the court accepts as true all well-pleaded facts in the complaint and draws all reasonable inferences therefrom in favor of the plaintiff. See Ameritech Corp. v. McCann, 297 F.3d 582, 585 (7th Cir. 2002). A complaint should be dismissed only if there is no set of facts in support of the claim that would entitle the plaintiff to relief. See Ledford v. Sullivan, 105 F.3d 354, 356 (7th Cir. 1997).

  II. Background*fn1

  UPS is an Ohio corporation with its principal place of business in Atlanta, Georgia. Pennie is an individual and a citizen of Illinois. In the complaint, UPS alleges that this court has subject matter jurisdiction on the basis of the parties' diverse citizenship and its contention that the amount in controversy exceeds $75,000.

  In 2001 and 2002, Pennie asserted various claims against UPS at the Illinois Industrial Commission ("ICC"), pursuant to the IWCA. The claims were based upon alleged injuries that occurred in the course and scope of Pennie's employment with UPS. On January 30, 2002, a functional capacity evaluation ("FCE") was conducted, and a written report was generated ("FCE report"). The FCE report identified certain physical limitations and work restrictions resulting from Pennie's on-the-job injuries.

  On May 3, 2003, Pennie's attorney sent a letter to UPS's insurance carrier requesting $214,375.60 based upon Pennie's wage differential claim. This request was premised upon Pennie's alleged work restrictions and his allegation that UPS did not wish to accommodate those restrictions. Subsequently, UPS assented to a wage differential settlement with Pennie pursuant to section 8(d)(1) of the IWCA. The settlement agreement provided for Pennie to receive an immediate cash payment of $85,000 and periodic payments of $3,300 per year for ten years (totaling $112,314 in payments to Pennie). The agreement also stated that the settlement "includes all claims for benefits past, present, and future under Section 8(d)(1)" of the IWCA. (Cmplt., Exh. D). On or about May 15, 2003, the ICC approved the settlement agreement, and UPS subsequently paid the full settlement amount to Pennie.

  The same month, Pennie "demanded" reinstatement to his prior position with UPS, asserting that he was under no disability or restriction and was capable of holding the position. (Cmplt., ¶ 11). Approximately six months later, in November 2003, UPS filed the instant action, seeking a declaratory judgment under the DJA. Specifically, UPS contends that Pennie's alleged acquiescence in UPS's wish not to accommodate his work restrictions (through his request for a settlement), his assertion of a wage differential claim under section 8(d)(1) of the IWCA, and his acceptance of $112,000 in satisfaction and settlement of his claim estop him from asserting any right to resume employment with UPS, and, particularly, in either his former position or any job whose demands exceed the restrictions identified in the FCE report. Along these lines, UPS seeks a determination and adjudication of the rights and obligations of the parties vis a vis the section 8(d)(1) settlement agreement.

  Pennie bases his Rule 12(b)(6) motion to dismiss upon several arguments. He contends that dismissal is appropriate because: (1) UPS has failed to adequately allege an actual case in controversy, injury in fact, or legally recognized interest; (2) UPS has failed to adequately allege the necessary elements of judicial estoppel; and (3) UPS's claim is not ripe.

  III. Analysis

  The DJA provides that, in "a case of actual controversy," federal courts "may declare rights and other legal relationships of any interested parties . . . whether or not further relief is or could be sought." 28 U.S.C. § 2201(a). The purpose of the DJA is "to avoid accrual of avoidable damages to one not certain of his rights and to afford him an early adjudication, without waiting until his adversary should see fit to begin suit, after damage had accrued." Nucor Corp. v. Aceros y Maquilas de Occidente, S.A. de C.V., 28 F.3d 572, 577 (7th Cir. 1994) (internal quotations and citations omitted).

  "Declaratory judgment actions serve an important role in our legal system insofar as they permit prompt settlement of actual controversies and establish the legal rights and obligations that will govern the parties' relationship in the future." Hyatt Intl Corp. v. Coco, 302 F.3d 707, 711 (7th Cir. 2002). Critically, the requirement of an "actual controversy" is contained within the text of the DJA, itself, and it is jurisdictional. ...

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