Shah v. Inter-Continental Hotel Chicago Operating

• Decision Date: 23 December 2002
• Docket Number: No. 02-1003.,02-1003.
• Citation: 314 F.3d 278
• Parties: Bhupendra SHAH, Plaintiff-Appellant, v. INTER-CONTINENTAL HOTEL CHICAGO OPERATING CORP., Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

314 F.3d 278

Bhupendra SHAH, Plaintiff-Appellant, v. INTER-CONTINENTAL HOTEL CHICAGO OPERATING CORP., Defendant-Appellee.

No. 02-1003.

United States Court of Appeals, Seventh Circuit.

Argued July 9, 2002.

Decided December 23, 2002.

Herbert H. Victor (argued), Chicago, IL, for Plaintiff-Appellant.

David E. Kawala (argued), Swanson, Martin & Bell, Chicago, IL, for Defendant-Appellee.

Before POSNER, RIPPLE, and WILLIAMS, Circuit Judges.

POSNER, Circuit Judge.

The district judge dismissed Shah's suit for failure to state a claim, precipitating this appeal, which presents a number of procedural issues. According to the allegations of the complaint, stripped of extraneous detail, the plaintiff and a partner had leased space from the defendant for the operation of two gift shops in hotels owned by the defendant in Chicago. The defendant decided to merge the two hotels, which were next door to each other at 505 and 535 North Michigan Avenue in Chicago, and convert the two gift shops into a single, larger gift shop to serve the merged facility. Under the lease, which continued despite the merger, the lessee was required to pay for the renovation necessary to create the new store. When the lease (which had been renewed once) expired, the plaintiff (who had broken with his partner and become the sole lessee) informed the defendant that he wanted to renew it. The defendant did not respond, and instead "contracted with Caucasian individuals, who had no prior relationship with Defendant and who had no knowledge of the store's functions .... Defendant's decision to select less qualified and knowledgeable Caucasian individuals to lease it's [sic] business premises when other non-Caucasian individuals [viz. the plaintiff] were available with more qualifications is clearly discriminatory when based on race and national origin" and "is in violation of Illinois Public Policy," which "dictates that such corporate decisions as the one set forth and described in this complaint should not be based solely on race or national origin." As a detail we note that the reference to racial discrimination is inaccurate, since Shah is an Indian (from India—not an American Indian) and Indians are Caucasians. But we take the complaint to be alleging that his national origin is different from that of the Caucasians to whom the space he had renovated was let.

The complaint was originally filed in an Illinois state court, and was removed to federal district court by the defendant on the basis of diversity of citizenship. Four days later the district judge dismissed the complaint on his own initiative without a statement of reasons except to remark that the dismissal was "without prejudice to the filing of any appropriate amended federal complaint." Shah's lawyer took this to mean that he should recaption the complaint to indicate that his suit was now in federal court and to include federal jurisdictional allegations to help the court satisfy itself that the case was indeed removable. This was a curious reaction, since it is the defendant's burden to establish that a case is removable to federal court, Workman v. United Parcel Service, Inc., 234 F.3d 998, 999 (7th Cir.2000), and Shah, the plaintiff, presumably wanted to remain in state court, having filed his suit there. But anyway he did what he thought the judge wanted him to do and filed an amended complaint. The defendant moved to dismiss it for failure to state a claim, arguing that a complaint must include "allegations concerning all material elements" of the "cause of action" and that Shah had failed to "plead sufficient facts" to provide a basis for concluding that the defendant had engaged in discrimination, and had failed to cite any statutory authority or to indicate the "type" of discrimination charged. The defendant noticed its motion for the district judge's September 25, 2001, call. Rule 5.3(b) of the U.S. District Court for the Northern District of Illinois requires all motions to be accompanied by a "notice of presentment" indicating the date and time at which and the judge to whom the motion will be presented in open court; this is to assure that motions are brought to the judge's attention for decision promptly and don't get lost in the flood of papers that get filed in district courts. Goss Graphics Systems, Inc. v. DEV Industries, Inc., 267 F.3d 624, 627 (7th Cir.2001). Rule 78.2 authorizes the district court to deny a motion that does not comply with Rule 5.3(b).

Shah's lawyer told the defendant's lawyer he wouldn't be able to attend the September 25 motion call and asked the lawyer to ask the judge to set a briefing schedule for the 12(b)(6) motion. When the motion was called on September 25, the defendant's lawyer duly relayed the request for a briefing schedule. The judge responded by ordering the complaint dismissed, though without prejudice. He gave no reason for the dismissal, or for making it without prejudice, saying only that the plaintiff had "until October 17, 2001 to file a motion for reconsideration with case authority" and that failure to do so would result in the dismissal's becoming a dismissal with prejudice. On October 17 the plaintiff's lawyer filed a motion for reconsideration in which he stated that discrimination in a real estate transaction violates the Illinois Human Rights Act. 775 ILCS 5/3-102. But he failed to file the required notice of presentment, though he had been warned by the defendant's lawyer that failure to file such a notice was a ground under Rule 78.2 for "striking" (actually for denying, but that is what he meant) the motion. The defendant moved to "strike" the motion for reconsideration on that ground, and the district court granted the motion.

The order granting the motion to strike was docketed on November 29 and the notice of appeal was filed on December 28. The defendant argues that the appeal, insofar as it seeks to challenge the dismissal of the suit back in September rather than just the denial of the motion for reconsideration, is untimely because the notice of appeal was filed more than 30 days after the dismissal was docketed (which was on September 26). But an order dismissing a suit without prejudice is not a final, appealable order unless it is apparent that the district court has finished with the case. Strong v. David, 297 F.3d 646, 648 (7th Cir.2002); Davis v. Ruby Foods, Inc., 269 F.3d 818, 819 (7th Cir.2001); Hunt v. Hopkins, 266 F.3d 934, 936 (8th Cir.2001); see also Smart v. International Brotherhood of Electrical Workers, Local 702, 315 F.3d 721, 725-26 (7th Cir.2002). Here on the contrary it was apparent that the judge had dismissed the suit without prejudice because he thought the plaintiff might persuade him to rescind the grant of the defendant's motion to dismiss. That possibility vanished only when the judge struck the motion to reconsider, at which point the dismissal ripened into a final judgment pursuant to his order of September 26. In effect, then, the docketing of the order to strike was the docketing of the final judgment and started the 30-day period for filing a notice of appeal running, and the appeal from the final judgment brings up to the appellate court all interlocutory rulings that the appellant cares to challenge that are not moot. Weiss v. Cooley, 230 F.3d 1027, 1031 (7th Cir.2000); Greer v. St. Louis Regional Medical Center, 258 F.3d 843, 846 (8th Cir.2001). Yet as this case and many other cases show, "springing" judgments (judgments that become final automatically upon the occurrence of some condition specified in an earlier order) should be avoided because they are a potent source of confusion concerning the timeliness of appeals. Otis v. City of Chicago, 29 F.3d 1159, 1163 (7th Cir.1994) (en banc); Baltimore & Ohio Chicago Terminal R.R. v. Wisconsin Central Ltd., 154 F.3d 404, 408 (7th Cir.1998); Adams v. Lever Bros. Co., 874 F.2d 393, 396 (7th Cir.1989).

The striking of the motion for reconsideration was a harsh sanction, possibly unreasonably so, see Goss Graphics Systems, Inc. v. DEV Industries, Inc., supra, 267 F.3d at 627; cf. Davis v. Ruby Foods, Inc., supra, 269 F.3d at 821, as no harm was done anybody by the failure to file a notice of presentment. The judge's action was also precipitate; he granted the motion to...