United States District Court, N.D. Illinois, Eastern Division
September 22, 2004.
ANGIE CHEN, Plaintiff,
MAYFLOWER TRANSIT, INC., Defendant.
The opinion of the court was delivered by: GERALDINE SOAT BROWN, Magistrate Judge
MEMORANDUM OPINION AND ORDER
Defendant Mayflower Transit, Inc. ("Mayflower") has moved to
have the statements in its Local Rule 56.1 Statement to which
plaintiff Angie Chen ("Chen") responded either "undisputed," or
"disputed in part," be deemed as admissions by Chen to be read to
the jury at the trial of this case. For the reasons set out
below, Defendant's Motion to Deem Additional Matters Admitted
[dkt 140] is denied. However, pursuant to Federal Rule of Civil
Procedure 56(d), this order identifies a number of facts that
appear to be both material and without substantial controversy.
Chen shall file and serve an objection by September 27, 2004 if
Chen objects to any of those facts being read to the jury as
In connection with its earlier motion for summary judgment on
Chen's RICO claim, Mayflower served a Statement of Material Facts
pursuant to Northern District of Illinois Local Rule 56.1. [Dkt 103.] As required by that Local Rule, Chen served a
response to that statement which, in a number of instances,
responded that facts stated by Mayflower were either "undisputed"
or "disputed in part." (Pl.'s 56.1(B) Resp. & Stmt. Add'l Facts.)
[Dkt 105.] Mayflower's motion for summary judgment was denied
[dkt 119], and the case is now set for trial. Mayflower's present
motion states that Mayflower sought to have those statements
submitted as stipulations of fact in the draft pretrial order,
but Chen refused to agree to do so. (Def.'s Mot. at 1.) Mayflower
has asked that the court determine those facts to be deemed
admitted by virtue of Chen's Local Rule 56.1 response, and permit
them to be read to the jury. (Id.)
I. Mayflower's motion is denied.
Local Rule 56.1 sets out a procedure that parties must follow
in connection with a motion for summary judgment. The moving
party must file a statement of material facts as to which the
moving party contends there is no genuine issue; the opposing
party must file a response to the statement that includes, "in
the case of any disagreement, specific references to the
affidavits, parts of the record, and other supporting materials
relied upon, . . ." L.R. 56.1(a)(3) and (b)(3)(A). The Local
Rule expressly states, "All material facts set forth in the
statement required of the moving party will be deemed to be
admitted unless controverted by the statement of the opposing
party." L.R. 56.1(b)(3)(B).
The Seventh Circuit has emphasized the importance of compliance
with Local Rule 56.1 for purposes of facilitating the decision on
summary judgment. See, e.g., Ammons v. Aramark Uniform Servs.,
Inc., 368 F.3d 809, 817-18 (7th Cir. 2004) (citing cases).
The Seventh Circuit has not determined whether Local Rule 56.1 responses may be used for any
purpose if the motion for summary judgment does not terminate the
case. Mayflower cites Zander v. Continental Casualty Co., No.
02-2696, 2003 WL 1545200 (7th Cir. Mar. 24, 2003), in support
of its position. (Def.'s Mot. at 1.) However, that decision is an
unpublished order that may not be cited as authority. 7th Cir. R.
More appropriately, Mayflower cites a decision by another judge
of this District holding that a Local Rule response could be used
as an admission at trial. In Frymire v. Peat, Marwick, Mitchell
& Co., No. 85 C 10460, 1991 WL 66381 at *1 (N.D.Ill.April 22,
1991) (Lindberg, J.), the court held that:
where an admission in a document required to be filed
in proceedings on a motion for summary judgment has
such potentially serious consequences as a Rule 12(N)
[the predecessor to Local Rule 56.1] response does,
the admission is of sufficient quality to permit it
to be used at trial.
Other judges of this District have held otherwise. In TIG Ins.
Co. v. Giffin, Winning, Cohen & Bodewes, P.C., No. 00 C 2737,
2002 WL 31870528 at *5 (N.D.Ill. Dec. 20, 2002) (Plunkett, J.),
the court refused to hold a defendant bound to admissions it
effectively made by failing to respond to the plaintiff's Local
Rule statement. The defendant in that case had moved for summary
judgment. Id. The plaintiff filed a Local Rule 56.1(b)(3)(B) statement of
additional facts supporting the denial of summary judgment. Id.
The defendant did not file a response to that statement. Id.
Summary judgment was apparently denied. The plaintiff then filed
a motion in limine seeking to exclude from trial evidence
inconsistent with the plaintiff's Local Rule 56.1(b)(3)(B)
statement. Id. at *1, 5. The court held that the defendant's
failure to respond to the plaintiff's Local Rule 56.1(b)(3)(B)
statement was not binding on the defendant because it was not an
admission, "in a pleading." Id. at *5. The court further stated
that, even if the failure to respond was an admission, the court
had the discretion to decide whether or not to accept a judicial
admission. Id. (quoting Singer v. State Farm Mut. Auto Ins.
Co., 116 F.3d 373, 376 (9th Cir. 1997)). The court also
observed that the failure to respond would be an admission only
as to the facts that were material to the motion for summary
judgment, and the plaintiff had made no effort to cull the
material facts from its Local Rule 56.1(b)(3)(B) statement,
arguing instead that the entire statement should be deemed
The TIG decision illustrates one of the practical problems
with using Local Rule statements for any purpose other than as
intended.*fn2 A more fundamental issue is whether a local
rule procedure designed to facilitate the court's ruling on summary judgment
should, after its purpose has been served, be elevated to the
same status as a procedure specifically established by the
Federal Rules of Civil Procedure. This court believes that it
First, it is unnecessary. Each paragraph of a Local Rule
statement must be supported by "affidavits, parts of the record,
and other supporting materials relied upon to support the facts
set forth in that paragraph." L.R. 56.1(a). Thus, by definition,
the party filing the Local Rule statement already has the
evidence necessary to prove the fact at trial.
Second, it is redundant in light of the request to admit
procedure expressly established in Rule 36 of the Federal Rules
of Civil Procedure. That rule provides a process for simplifying
proof at trial or on dispositive motion by identifying facts that
cannot reasonably be disputed. The conclusive effect of an
admission pursuant to that rule is expressly stated. See
Fed.R. Civ. P. 36(b). In the present case, a specific deadline was
set for the serving of requests to admit, well before the motions
for summary judgment were filed. (Nov. 1, 2002 Order.) [Dkt 89.]
The court has serious reservations about creating a local rule
alternative to the request to admit process, especially where the
local rule does not expressly state that it has any other use
except on a motion for summary judgment.
Third, deeming Local Rule 56.1 responses as admissions for
purposes of trial may hinder the original purpose of the local
rule. Undoubtedly, Local Rule 56.1 responses can have serious
consequences, as observed by the court in the Frymire case and
illustrated by the Ammons case. On the other hand, they may
have no effect on the motion for summary judgment if, even with
the admission, the movant has not presented the evidence
necessary to obtain summary judgment. A party may decide that a factual matter is inconsequential to the
decision on summary judgment, but may not want to be bound by
that fact if the matter goes to trial. If failing to dispute a
matter in a Local Rule 56.1 statement forecloses presenting any
evidence on that point at trial, parties will be very reluctant
to acknowledge that any fact, even the most trivial, is
Fourth, Federal Rule of Civil Procedure 56(d) sets out a
procedure by which the responses can be put to use in the trial,
in the control and discretion of the judge. That section of Rule
56 provides that, if a motion for summary judgment is denied, the
by examining the pleadings and the evidence before it
and by interrogating counsel, shall if practicable
ascertain what material facts exist without
substantial controversy and what material facts are
actually and in good faith controverted. It shall
thereupon make an order specifying the facts that
appear without substantial controversy. . . . Upon
the trial of the action the facts so specified shall
be deemed established, and the trial shall be
Fed.R. Civ. P. 56(d). The judge is thereby authorized, in the
court's discretion, to determine what is really contested.
Presumably, the Local Rule responses will be a significant part
of that decision.
For the foregoing reasons, the court concludes that the
parties' Local Rule 56.1 responses cannot be used as admissions
in the trial of the case. Mayflower's motion is denied.
II. Pursuant to Federal Rule of Civil Procedure 56(d), certain
facts appear to be without substantial controversy.
Although Mayflower's motion is denied, Mayflower correctly
points that the trial would be expedited by allowing facts not
disputed to be submitted to the jury as stipulated. Chen objects
that many of the undisputed statements are selected passages from
Mayflower's tariff, which should be read in the context of the
entire tariff, pursuant to Federal Rule of Evidence 106. (Pl.'s
Resp. at 3-4.) The court agrees that the tariff passages should
not be read as stipulated facts, both pursuant to the logic of Rule 106 and because it is unlikely that the jurors will
be able to make much sense out of them read as stipulated facts.
However, reviewing Chen's Local Rule 56.1 response, the court
concludes that the following facts appear to be both material and
without substantial controversy:
1. Mayflower is federally licensed as an interstate motor
carrier and has been for over 75 years.
2. Mayflower enters into Agency Agreements with independently
owned moving and storage companies located in all 50 states.
Currently, there are approximately 400 Mayflower agents. To
become an agent of Mayflower, the independent moving and storage
company must enter into Mayflower's standard agency contract. By
signing the Agency Agreement the agents agree to abide by
Mayflower's policies, procedures, tariffs and applicable federal
and state laws and regulations.
3. In its interstate household goods business, Mayflower itself
does not own trucks, does not employ drivers, and does not
directly perform the physical work associated with any aspect of
transporting the goods in interstate commerce. That work is
performed by drivers provided by the agents and trucks that are
leased to Mayflower by its agents. All Mayflower agents execute a
standard lease providing that, when their trucks and trailers are
engaged in rendering any services relating to the interstate
transportation of goods under Mayflower's federal operating
authority, they are leased to Mayflower.
4. While it is the Mayflower agent who employs the drivers and
owns or leases the equipment used to service a Mayflower
interstate household goods shipment, Mayflower is responsible for
qualifying the drivers and equipment pursuant to the Federal
Motor Carrier Safety Regulations and Mayflower's policies. It is
a violation of Mayflower policy for agents to use unqualified
drivers or equipment for shipments moving under Mayflower's
federal operating authority. Agents who deviate from Mayflower's policy in this way are subject to
disciplinary action, up to and including termination of the
5. For Mayflower shipments moving under Mayflower authority,
when a credit card is used to pay for transportation services,
the merchant account used is the one held by Mayflower. For moves
registered with Mayflower and moving under Mayflower's authority,
Mayflower's policies require that the shipper's card be processed
through Mayflower's merchant account. This means that the
customer's payment is received by Mayflower, and not by the
agent. It also means that Mayflower is the one dealing with the
credit card issuer, under Mayflower's contract with the issuer.
6. Credit card billings are collected directly by Mayflower.
When cash is collected by the hauling agent at delivery, the
funds are retained by the agent, but the agent enters into the
Mayflower system the amount collected and it is posted as a debit
against the agent's account when distribution takes place. When
Mayflower distributes the revenue for a given shipment to the
agents providing the service, the revenue is posted to the
hauling agent's statement as a credit, which results in a partial
offset. The accrued net statement balance between Mayflower and
the agent is cleared on a weekly basis. When the week's
transactions result in a net credit balance, Mayflower transfers
the credit amount to the agent's bank account by electronic funds
transfer. When the week's transactions result in a net debit
balance, because the agent collects more money on Mayflower
orders than it received credits for services provided, the agent
is required to remit payment of the debit amount to Mayflower.
7. Once the funds are collected for a given interstate
shipment, Mayflower distributes them in accordance with a
predetermined formula. The "line haul" charges, constituting the
charges for actual transportation of the shipment, are
distributed on average (the exact percentage varies with the weight of the shipment and the distance it is transported) as
follows: Mayflower retains 13%; the agent booking the shipment is
paid 14%; the origin agent (which is usually, but not always, the
same as the booking agent) receives 3%; and the balance is paid
to the hauling agent. The hauling agent is the one that
transports the shipment from origin to destination, and who
provides the equipment and the driver. The origin agent is the
one that provides services at the origin including estimating and
packing, and when required, picks up the shipment from the
residence and holds it at the warehouse. The booking agent is
responsible for registering the shipment in the Mayflower system.
The shipper is not charged for an estimate, and the booking agent
receives no payment for providing an estimate to the shipper.
8. Charges for services rendered at the point of origin are
distributed 100% to the agent that provides the service, except
for packing, of which Mayflower retains 10% with the agent
receiving the rest, excluding the cost of containers. Valuation
charges are retained by Mayflower in their entirety, because
Mayflower has the financial liability for any cargo loss or
damage to the shipment. Charges for services rendered at
destination are distributed 100% to the agent that provides the
service. Thus Mayflower derives no revenue from any additional
services performed incident to the delivery of shipments.
9. Mayflower contracts to perform up to 400 interstate moves
Because the parties were not advised that the court would enter
an order pursuant to Rule 56(d), Chen will be given an
opportunity to file an objection to any of those ninestatements
being read to the jury as an uncontested fact. Conclusion
For the reasons discussed above, Mayflower's motion is denied.
However, as further set forth above, a number of facts appear to
be both material and without substantial controversy. If Chen has
any objection to any of those nine statements being read to the
jury as uncontested facts, she must file an objection identifying
the specific proposed fact(s) to which she objects, and serve
Mayflower's counsel with a copy of her objections, by 4:30 p.m.
on September 27, 2004.
IT IS SO ORDERED.