United States District Court, S.D. Illinois
SUE A. MEYERS, INC., Plaintiff,
DEBRA A. CLARK and BILL GRUNLOH, Defendants.
MEMORANDUM AND ORDER
Reona J. Daly United States Magistrate Judge
the Court is Defendants' Amended Motion to Dismiss (Doc.
40), Plaintiff's response (Doc. 43), and Defendants'
reply (Doc. 45). For the following reasons, the Motion is
to the First Amended Complaint (Doc. 28), in 2012, FH
Paschen, a construction company, was awarded a contract by
the State of Illinois for a road project in Marion, Illinois.
Paschen contracted with Plaintiff Sue A. Meyers, Inc.
(“Meyers”), a trucking company that qualified as
a Disadvantaged Business Enterprise (DBE), to perform
materials transportation for the project. The contract was
worth $1, 597, 340.00. Meyers began work on the project on
March 5, 2012.
of the following year, Paschen terminated its contract with
Meyers after receiving notification from the Illinois
Department of Transportation's (“IDOT”)
Bureau Chief, Debra A. Clark, that Meyers did not meet the
qualifications of a DBE. Shortly thereafter, on July 20,
2013, IDOT's Chief Procurement Officer, Bill Grunloh,
issued a Notice of Suspension, suspending Meyers'
participation in the DBE program. Meyers retained counsel and
spent the next couple of years attempting to resolve its
status. On July 24, 2017, IDOT's Bureau Chief of Claims,
Jim Sterr, indicated that the suspension would be removed.
filed its original Complaint in this Court on July 6, 2018
and a First Amended Complaint naming the current Defendants
on May 24, 2019 (Doc. 28). In the First Amended Complaint,
Meyers alleges that Defendants “abridged” its
“freedom under the U.S. Constitution” and its
liberty interests and “wrongfully interfered”
with its contractual relationship with Paschen. It claims
Defendants' actions resulted in at least $5, 000, 000 in
lost profits and revenues because it was prevented from
pursuing its business due to the suspension of its status as
survive a motion to dismiss for failure to state a claim
under Rule 12(b)(6), a Complaint must “state a claim to
relief that is plausible on its face.” Lodholtz v.
York Risk Servs. Group, Inc., 778 F.3d 635, 639 (7th
Cir. 2015) (quoting Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007)). “A claim has facial plausibility
when the plaintiff pleads factual content that allows the
court to draw the reasonable inference that the defendant is
liable for the misconduct alleged.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009). “[W]hen ruling on
a defendant's motion to dismiss, a judge must accept as
true all of the factual allegations contained in the
complaint.” Erickson v. Pardus, 551 U.S. 89,
94 (2007). The Court must also draw all reasonable inferences
and facts in favor of the plaintiff. See Vesely v.
Armslist LLC, 762 F.3d 661, 664 (7th Cir. 2014).
argue that Meyers' federal claim is barred by the statute
of limitations for “stigma-plus” due process
claims. Meyers, Inc. does not challenge Defendants'
characterization of its federal claim. A statute of
limitations defense is an affirmative defense that generally
would not be asserted in a motion to dismiss. Fed.R.Civ.P.
8(c). However, “the statute of limitations may be
raised in a motion to dismiss if ‘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) (quoting
United States v. Lewis, 411 F.3d 838, 842 (7th Cir.
order to plead a “stigma-plus” due process claim,
a plaintiff must sufficiently allege: “(1) that [it]
had a cognizable liberty interest under the Fourteenth
Amendment; (2) that [it] was deprived of that liberty
interest; (3) and that the deprivation was without due
process.” Mann v. Vogel, 707 F.3d 872, 877
(7th Cir. 2013). A plaintiff can show a liberty interest by
alleging that a defamatory statement resulted in a material
alteration of its legal status. Hannemann v. S. Door Cty.
Sch. Dist., 673 F.3d 746, 753 (7th Cir. 2012). Here,
Meyers alleges that Defendants cast doubt on its character by
stating that it violated Illinois law and is not a DBE, which
made it impossible for it to pursue its trucking/hauling
business. This is sufficient to assert a protected interest
under the “stigma plus” standard. Meyers further
alleges that it was deprived of its liberty interest when
IDOT revoked its DBE status and that it did so without
affording Meyers due process. These allegations state a
colorable due process claim. This does not end the
Court's inquiry however.
not mentioned in the First Amended Complaint, Meyers,
Inc.'s due process claim is brought pursuant to 42 U.S.C.
§ 1983. The statute of limitations for claims under
§ 1983 is borrowed from state law and is two years in
Illinois. Moore v. Burge, 771 F.3d 444, 446 (7th
Cir. 2014). In applying the statute of limitations, the Court
must first identify the injury and then “…must
determine the date on which the plaintiff could have sued for
that injury.” Hileman v. Maze, 367 F.3d 694,
696 (7th Cir. 2004). The date on which the claim accrues and
thus begins the running of the limitations period is a matter
of federal law and generally occurs when a plaintiff knows or
should know that his or her constitutional rights have been
violated. Moore, 771 F.3d at 447.
on the allegations in the First Amended Complaint (Doc. 28),
Meyers' contract with Paschen was terminated in response
to a letter Paschen received from Clark dated May 6, 2013,
stating that Meyers was not a DBE business. Id.
¶ 10. Meyers was informed of the contents of the letter
May 10, 2013 by correspondence from Douglas Pelletier of
Paschen. Id. ¶ 13. Meyers' DBE status was
subsequently suspended on July 20, 2013 by Grunloh.
Id. ¶¶ 15-16. As such, Meyers' claim
accrued on July 20, 2013 at the latest and the limitations
period expired on July 20, 2015.
did not commence the instant lawsuit until July 6, 2018 and
did not name the individual Defendants until it filed the
First Amended Complaint on February 7, 2019 (Doc. 21). Thus,
its due process claim appears untimely on its face. But
Meyers argues that Defendants' actions constituted a
continuing violation that was not complete until 2018.
“A continuing violation is one that could not
reasonably have been expected to be made the subject of a
lawsuit when it first occurred because its character as a
violation did not become clear until it was repeated during
the limitations period.” Dasgupta v. University of
Wisconsin Bd. Of Regents, 121 F.3d 1138, 1139 (7th Cir.
was no series of acts that led to the due process violation
Meyers alleges. Rather, the alleged violation was or should
have been clear to Meyers on May 10, 2013 when it was advised
that its Contract with Paschen was cancelled, or at the
latest, on July 20, 2013 when it was advised its DBE status
was suspended. Wallace v. Kato, 549 U.S. 384, 391
(2007) (“Under the traditional rule of accrual the tort
cause of action accrues, and the statute of limitations
commences to run, when the wrongful act or omission results
in damages. The cause of action accrues even though the full
extent of the injury is not then known or predictable.”
(quotation marks, editing ...