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Yates v. H&M International Transportation Inc.

United States District Court, N.D. Illinois, Eastern Division

July 9, 2019

TROY YATES, MIKE WILLS, and OTHER SIMILARLY SITUATED INDIVIDUALS, Plaintiffs,
v.
H&M INTERNATIONAL TRANSPORTATION, INC, DAVE TURBYFILL, and other UNNAMED PERSONS, Defendants.

          MEMORANDUM OPINION & ORDER

          ROBERT M. DOW, JR. UNITED STATES DISTRICT JUDGE.

         Plaintiffs Troy Yates and Mike Wills, on behalf of themselves and all other persons similarly situated, bring this putative class-action against H&M International Transportation, Inc. (“H&M”), Dave Turbyfill, and unknown Officers and Directors of H&M for racial discrimination under various sections of the Civil Rights Act of 1866, specifically, 42 U.S.C. § 1981 (Count I), § 1985 (Count II), and § 1986 (Count III). Currently before the court is H&M's partial motion to dismiss [9] Counts II and III as well as its supplemental motion to dismiss [17] Count I, both pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons explained below, the Court grants both motions. Count I is dismissed with prejudice as to Yates and Wills. Counts II and III are dismissed without prejudice. Pursuant to the Seventh Circuit's instructions in Matz v. Household Int'l Tax Reduction Inv. Plan, 774 F.3d 1141, 1144-45 (7th Cir. 2014), and Robinson v. Sheriff of Cook Co., 167 F.3d 1155, 1157-58 (7th Cir. 1999), purported-class counsel is given until August 16, 2019 to file a motion to substitute plaintiffs as to Count I and/or an amended complaint as to all counts consistent with this opinion. The case is set for further status on August, 21, 2019 at 9:00 a.m.

         I. Background [1]

         Yates and Wills are African-American men employed, or formerly employed, by H&M. [1, ¶ 4.] H&M employed Yates from 2015 to early 2016. [Id. ¶ 5.] Wills joined H&M in September 2014 and continues to work there today. [Id. ¶ 6.] Defendant Turbyfill is an Assistant Terminal Manager for H&M. [Id. ¶ 16.]

         Plaintiffs allege that H&M engaged in a “pay-to-play” scheme-overseen by Turbyfill- in which H&M employees offered jobs to African-American men in exchange for payments of between $1, 000 and $2, 500. [Id. ¶¶ 11, 16.] No. non-African-Americans were allegedly required to pay to gain employment at H&M. [Id. ¶ 28.] In fact, Plaintiffs allege, H&M has a history of such schemes. For example, prior to the one overseen by Turbyfill, a different H&M employee offered African-American men jobs for cash and then fired those hired one day shy of their ninetieth work day, thus preventing their union rights from vesting. [Id. ¶¶ 11-13.]

         With regard to the current scheme, Plaintiffs allege that in December 2014, Mr. Gartnez Lowe approached Yates and invited him to apply for employment at H&M. [Id. ¶¶ 17, 18.] At that time, Lowe told Yates that Turbyfill required a $1, 000 payment to get the job: a $500 deposit with his application and $500 at his start date. [Id. ¶ 19.] Yates then submitted his application and the $500 deposit to Lowe “one week before Christmas 2014.” [Id. ¶ 20.] Yates subsequently reported for work at H&M on January 6, 2015 without ever having had an interview. [Id. ¶ 21.] Plaintiffs allege that other individuals applied with Yates, but none of them either paid Lowe or were hired. [Id. ¶ 22.] After Yates complained about this practice, H&M allegedly fired him. [Id. ¶ 23.] Yates subsequently filed a Charge of Discrimination with the Equal Employment Opportunity that remains pending. See [9-1].

         Wills allegedly suffered a similar experience. See generally [1]. In late summer 2014, an unnamed acquaintance of Turbyfill approached Wills. [1, ¶ 24.] That individual informed Wills that he could get Wills a job at H&M for $2, 000. [Id. ¶ 25.] Wills paid the money along with his application and H&M subsequently hired him on September 24, 2014. [Id. ¶ 27.]

         Plaintiffs initiated this lawsuit on August 31, 2018. See generally [1]. Plaintiffs assert that Defendants' alleged “pay-to-play” scheme targeting African-Americans violated federal antidiscrimination law, specifically 42 U.S.C. § 1981 (Count I). [1, ¶ 34.] Plaintiffs also assert that H&M employees and unnamed non-employees engaged in a conspiracy to deny African-American applicants and employees equal rights under the law in violation of 42 U.S.C. § 1985 (Count II). [1, ¶ 39.] Finally, Plaintiffs assert that the unnamed Officers and Directors of H&M had knowledge of the alleged scheme perpetuated by Turbyfill and that the unnamed H&M Officers and Directors neglected to prevent this scheme from occurring in violation of 42 U.S.C. § 1986 (Count III). [1, ¶¶ 44, 45.] In addition to their own claims, Plaintiffs seek to represent a class of similarly situated African-American H&M employees and applicants from August 2014 to present. [Id. ¶ 30.]

         H&M brought its partial motion to dismiss [9] on November 2, 2018 seeking to dismiss Counts II and III on statute of limitations grounds. See [9, at 3-5]. After reviewing Plaintiffs' response to that motion, H&M requested leave to file a supplemental motion to dismiss in its reply, arguing that Plaintiff had demonstrated that Count I was untimely as well. See [17, at 2]. Having granted that motion [24], the parties have briefed that issue as well and the Court now resolves both motions.

         II. Standard

         To survive a Rule 12(b)(6) motion to dismiss for failure to state a claim upon which relief can be granted, the complaint first must comply with Rule 8(a) by providing “a short and plan statement of the claim showing that the pleader is entitled to relief, ” Fed.R.Civ.P. 8(a)(2), such that the defendant is given “fair notice of what the * * * claim is and the grounds upon which it rests.” Bell Atl. Corp v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)) (alteration in original). Second, the factual allegations in the complaint must be sufficient to raise the possibility of relief above the “speculative level.” E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 776 (7th Cir. 2007) (quoting Twombly, 550 U.S. at 555). “A pleading that offers ‘labels and conclusions' or a ‘formulaic recitation of the elements of a cause of action will not do.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S at 555). Dismissal for failure to state a claim under Rule 12(b)(6) is proper “when the allegations” in a complaint, however true, could not raise a claim of entitlement to relief.” Twombly, 550 U.S. at 558. In reviewing a motion to dismiss pursuant to Rule 12(b)(6), the Court accepts as true all of Plaintiff's well-pleaded factual allegations and draws all reasonable inferences in Plaintiff's favor. Killingsworth v. HSBC Bank Nevada, N.A., 507 F.3d 614, 618 (7th Cir. 2007). Evaluating whether a claim is sufficiently plausible to survive a motion to dismiss is “a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” McCauley v. City of Chi., 671 F.3d 611, 616 (7th Cir. 2011) (quoting Iqbal, 556 U.S. at 679).

         III. Analysis [2]

         A. Count I

         Defendants argue the Court must dismiss Count I as untimely under the applicable statute of limitations. Settled Seventh Circuit law holds that a statute of limitations defense is an affirmative defense that a complaint need not anticipate or allege facts to defend against. U.S. Gypsum Co. v. Indiana Gas Co., Inc. et al.,350 F.3d 623, 628 (7th Cir. 2003); see also Barry Aviation, Inc. v. Land O' Lakes Mun. Airport Comm'n.,377 F.3d 682, 688 (7th Cir. 2004) (finding that the resolution of the statute of limitations comes after the complaint stage). The exception to this rule arises when the “allegations of the complaint itself set forth everything necessary to satisfy the affirmative defense.” Brooks v. Ross, 578 F.3d 574, 579 (7th Cir. 2009). In Brooks, for example, the Seventh Circuit concluded that it was appropriate to consider the statute of limitations at the motion to dismiss stage because “the relevant dates [we]re set forth unambiguously in the Complaint” and because the plaintiff's one substantive response to the defense was inapposite. Id. Here, while Plaintiffs note that courts generally address statutes of ...


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