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Gerrard v. Andrews International Inc.

September 16, 2010


The opinion of the court was delivered by: Joe Billy McDADE United States Senior District Judge


This matter is before the Court on Defendant's Motion to Dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and/or 12(b)(6), and Memorandum in Support (Docs. 12 & 13). Plaintiff has filed his Response in opposition to the Motion. (Doc. 16). Also before the Court is a Report and Recommendation ("R&R") from Magistrate Judge Cudmore on the Motion to Dismiss, in which he recommends that the Motion be denied. (Doc. 17). Defendant has timely filed Objections to the R&R and a Memorandum in Support, and Plaintiff has filed a Response to Defendant's Objections. (Docs. 18, 19 & 20). For the reasons stated below, the Motion to Dismiss is denied, and the R&R is adopted.


On May 14, 2009, Plaintiff filed charges against Defendant with the EEOC alleging sexual discrimination and retaliatory action. The EEOC issued a Right to Sue Letter, pursuant to which Plaintiff filed the instant suit on August 10, 2009. (Doc. 1). Plaintiff's Complaint was filed 88 days after the issuance of the Right to Sue Letter, which was two days prior to the expiration of the applicable statute of limitations. (Doc. 17 at 2). Plaintiff had previously filed a defamation suit against Defendant in April 2008, which was removed to this Court on June 23, 2008. (Doc. 17 at 2; 1:08-cv-01146 Doc. 1). Counsel for the parties is the same in both actions.

On August 20, 2009, in connection with the instant litigation, Defendant's counsel informed Plaintiff's counsel that he had been notified of this second lawsuit and offered to sign a waiver of service on Defendant's behalf. (Doc. 13 Exhb. 1).*fn1

Plaintiff's counsel acknowledged receipt of this e-mail, however she never sent the agreed upon waiver request. (Doc. 13 at 3). On January 4, 2010, Magistrate Judge Cudmore issued a text order noting that the record did not reflect service upon Defendant within the 120-day period provided by Federal Rule of Civil Procedure 4(m) ("Rule 4(m)"), and directing Plaintiff to file a status report showing cause why the case should not be dismissed. (1/04/2010 Text Order). Plaintiff's counsel responded by admitting fault in failing to send the waiver and asked the Court to allow time for a waiver to be sent. (Doc. 5). Magistrate Judge Cudmore granted the request for additional time to send the waiver, which was sent by Plaintiff on February 9, 2010. (1/15/2010 Text Order; Doc. 7). Defendant executed the waiver of service, and subsequently moved to dismiss this action as time-barred by the applicable statute of limitations. (Doc. 12).

Defendant argued that although the statute of limitations tolled during the 120 days for service, because service was not perfected within this time period the clock resumed on December 8, 2009 and expired 2 days later, on December 10, 2009. In the alternative, Defendant argued that Magistrate Judge Cudmore should not have allowed Plaintiff to serve process outside of the 120-day window. In his R&R issued on July 28, 2010, Magistrate Judge Cudmore rejected Defendant's arguments and recommended that its Motion to Dismiss be denied. (Doc. 17). Magistrate Judge Cudmore first found that Plaintiff's Complaint was timely filed and, because, it was never dismissed for failure to serve, could not become untimely due to late service. (Doc. 17 at 5). Thus, he construed Defendant's motion as a motion to dismiss under Rule 12(b)(4) and/or 12(b)(5) based on an argument that the Court should not have extended Plaintiff's time for service under Rule 4(m). (Doc 17 at 5). However, after finding that the district court has wide discretion to grant an extension of time for service under 4(m), Judge Cudmore determined that doing so under the circumstances of this case was warranted. (Doc. 17 at 9). On August 11, 2010, Defendant filed its Objection to the R&R and Memorandum in Support. (Docs. 18 & 19). On August 24, Plaintiff filed its Response. (Doc. 20).


"In ruling on Rule 12(b)(6) motions, the court must treat all well-pleaded allegations as true and draw all inferences in favor of the non-moving party." In re marchFIRST Inc., 589 F.3d 901, 904 (7th Cir. 2009) (citing Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir.2008)). To survive a motion to dismiss under 12(b)(6), a plaintiff's complaint must "plead some facts that suggest a right to relief that is beyond the 'speculative level.'" EEOC v. Concentra Health Svcs., Inc., 496 F.3d 773, 776-77 (7th Cir. 2007) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 560-63 (2007)). Though detailed factual allegations are not needed, a "formulaic recitation of a cause of action's elements will not do." Twombly, 550 U.S. at 547. "The complaint must contain 'enough facts to state a claim to relief that is plausible on its face.'" Bissessur v. Indiana University Bd. of Trustees, 581 F.3d 599, 602 (7th Cir. 2009) (quoting Twombly, 550 U.S. at 557; Tamayo, 526 F.3d at 1084). In addition, a complaint may be dismissed "for failure to state a claim if the allegations, taken as true, show that the plaintiff is not entitled to relief," for example, if the allegations "show that relief is barred by the applicable statute of limitations." Jones v. Bock, 549 U.S. 199, 215 (2007).

A district court reviews de novo any portion of a Magistrate Judge's R&R to which a "specific written objection has been made." FED. R. CIV. P. 72(b)(3). "The district judge may accept, reject, or modify the recommended disposition; receive further evidence; or return the matter to the magistrate judge with instructions." Id.


I. Impact of Untimely Service of Process Upon Statute of Limitations

Defendant does not contest that Plaintiff's claim was originally filed within the applicable statute of limitations, rather it argues that the claim became barred on December 10, 2009, two days after the 120-day period for service of process had expired. (Doc. 19 at 1-2). In its Objection to the R&R, Defendant argues that Magistrate Judge Cudmore was mistaken in his finding that the statute of limitations did not begin to run again after Plaintiff failed to serve Defendant within 120 days. (Doc. 19 at 2). Defendant first argues that this mistake was based upon a misreading of Frasca v. United States, 921 F.2d 450 (2d Cir. 1990), and a failure to address several other cases which held that "a timely filed claim becomes untimely for statute of limitations purposes because of late service." (Doc. 19 at 5).

Defendant is correct that in Frasca, the Second Circuit held "that the filing of a complaint does not toll the applicable statue of limitations beyond the 120-day period for service provided by Rule 4(j)" even though an order of dismissal is not yet entered. 921 F.2d at 451. However, Frasca was decided before the 1993 Amendments to Federal Rule of Civil Procedure 4(m). This is important because prior to the amendments, the rules established that dismissal for untimely service was mandatory unless plaintiff could show good cause, id. at 453, whereas after them courts were given the discretion to enlarge the 120 day period even if no good cause was shown. Panaras v. Liquid Carbonic Indus. Corp., 94 F.3d 339, 341 (7th Cir. 1996).*fn2 Further, in the Advisory Committee Notes to the 1993 amendments to Rule 4, the Committee states that one of the reasons a district court may use its discretion to enlarge the time for service is "if the applicable statute of limitations would bar the refiled action." FED. R. CIV. P. 4 Advisory Committee's Notes. The Frasca holding is at odds with this provision. It would be nonsensical to say that a court may use its discretion to extend plaintiff's time to serve process with the goal ...

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