Gary/Chicago Int'l Airport Auth. v. Zaleski

• Decision Date: 17 November 2015
• Docket Number: CAUSE NO. 3:15–CV–50–RLM–CAN
• Parties: Gary/Chicago International Airport Authority, Plaintiff & Counter–Defendant v. Anthony Zaleski, Jr., Trust A–878, and Indiana Land Trust Company (formerly Lake County Trust Company as Successor Trustee of Trust A–878, Defendants, Counter–Plaintiffs, & Third–party Plaintiffs v. Oxy USA, Inc., Third Party Defendant
• Court: U.S. District Court — Northern District of Indiana

144 F.Supp.3d 1019

Gary/Chicago International Airport Authority, Plaintiff & Counter–Defendant
v.
Anthony Zaleski, Jr., Trust A–878, and Indiana Land Trust Company (formerly Lake County Trust Company as Successor Trustee of Trust A–878, Defendants, Counter–Plaintiffs, & Third–party Plaintiffs
v.
Oxy USA, Inc., Third Party Defendant

CAUSE NO. 3:15–CV–50–RLM–CAN

United States District Court, N.D. Indiana, South Bend Division.

Signed November 17, 2015

144 F.Supp.3d 1020

Bradley R. Sugarman, Melissa A. Gardner, Frank J. Deveau, Taft Stettinius & Hollister LLP, Indianapolis, IN, for Plaintiff & Counter–Defendant.

Adam John Sedia, Rubino Ruman Crosmer & Polen, Dyer, IN, for Defendants, Counter–Plaintiffs, & Third–Party Plaintiffs.

Karl A. Karg, IV, Michael J. Nelson, Latham & Watkins LLP, Chicago, IL, for Third Party Defendant.

OPINION and ORDER

Robert L. Miller, Jr., Judge, United States District Court

Third-party defendant OXY USA, Inc. (“OXY”) moved to dismiss the third-party complaint brought by defendants/third-party plaintiffs Anthony Zaleski, Jr., Trust A–878, and Indiana Land Trust Company (collectively, “defendants”). (Doc. No. 43). For the reasons that follow, the court grants the motion and dismisses the third-party complaint with prejudice.

144 F.Supp.3d 1021

I. Background

This case began in 2012 when the Gary/Chicago Airport Authority acquired two plots of land from the defendants, one from Trust A–878 and one from Mr. Zaleski. The Airport Authority brought this suit against the defendants in January 2015, alleging that the land it acquired from them is contaminated and seeking damages and declaratory relief under various state and federal statutes.

In response, the defendants filed the third-party complaint at issue here. The defendants allege that the Trust acquired the land in question in 1976, and that before 1976 the land was owned by OXY's predecessor, Cities Service Oil Company. Between acquiring the land in 1976 and transferring it to the Airport Authority in 2012, the defendants didn't cause or contribute to the discharge of oil or other contaminants on the land. Rather, throughout this period OXY's predecessors owned and operated oil and gas pipeline easements across the property in question. Accordingly, the defendants insist that any contamination—whether arising before or after they acquired the land from Cities Service—was caused by OXY and its predecessors and so is OXY's responsibility. The third-party complaint seeks contribution from OXY for any liability the defendants owe to the Airport Authority, as well as declaratory judgment to the same effect.

II. Standard of Review

OXY moves to dismiss the third-party complaint in its entirety for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). To state a claim, a complaint need only contain a short and plain statement showing that the plaintiff is entitled to relief. See EEOC v. Concentra Health Servs., Inc., 496 F.3d 773, 776 (7th Cir.2007). When deciding a Rule 12(b)(6) motion, a court must accept as true all well-pleaded factual allegations in the complaint and draw all reasonable inferences in the non-moving party's favor. See Hecker v. Deere & Co., 556 F.3d 575, 580 (7th Cir.2009).

A complaint survives a motion to dismiss under Rule 12(b)(6) if it contains sufficient factual allegations to “state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (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.” Adams v. City of Indianapolis, 742 F.3d 720, 728 (7th Cir.2014) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ). “Specific facts are not necessary; the statement need only give the defendant fair notice of what the ... claim is and the grounds upon which it rests.” Erickson v. Pardus, 551 U.S. 89, 93, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (ellipsis in original).

III. Discussion

OXY's motion is based on a document attached to the motion, which OXY claims is the written agreement by which Cities Service sold the property. OXY argues that the assumption of liabilities in this agreement precludes the defendants from seeking contribution from OXY for environmental contamination.

Before reaching the merits, the court must resolve two disputes about what material may be considered in ruling on OXY's motion to dismiss. At the motion to dismiss stage, a court typically considers only the facts alleged in the complaint or contained in exhibits attached to the complaint. See Forrest v. Universal Savings Bank, F.A., 507 F.3d 540, 542 (7th Cir.2007). OXY urges the court to consider facts offered in two documents that aren't part of the third-party complaint at

144 F.Supp.3d 1022

issue: the Airport Authority's original complaint against the defendants, and a purported copy of the 1975 agreement through which Cities Services transferred the land at issue.

A. The Airport Authority's Original Complaint

A court ruling on a motion to dismiss may consider documents not part of the complaint “if they are referred to in the plaintiff's complaint and are central to his claim.” Wright v. Assoc. Ins. Cos., Inc., 29 F.3d 1244, 1248 (7th Cir.1994). OXY urges the court to accept as true not only the facts alleged in the defendants' third-party complaint, but also the facts the Airport Authority alleged in its initial complaint against the defendants. OXY argues that the “Airport's allegations are the basis of and incorporated into the 3rd party complaint,” so the entirety of the Airport Authority's complaint must be accepted as true for purposes of this motion to dismiss. OXY relies on the Airport Authority's allegations in support of several arguments in the motion to dismiss.

To assume the truth of all the Airport Authority's allegations in evaluating the legal sufficiency of the third-party complaint would make little sense. Unlike in the typical incorporation-by-reference situation in which a plaintiff relies on the truth and validity of an external document to support its claims, the third-party complaint here neither admits nor depends on the truth of the Airport Authority's claims; it simply asserts that if the defendants are held liable to the Airport Authority, OXY should be liable for contribution. The third-party complaint avoids admitting many of the key allegations of the Airport Authority's complaint. (See, e.g., Third–Party Complaint, Doc. No. 41 at ¶ 8) (referring to “the alleged events giving rise to the Airport Authority's claims”) (emphasis added).

More significantly, in its answer to the Airport Authority's complaint, the defendants explicitly deny many of the same facts that OXY seeks to deem admitted. For example, OXY makes arguments related to Mr. Zaleski's alleged status as a general partner in a partnership called Lake Material Service. Yet while the Airport Authority's complaint alleged that Mr. Zaleski was a member of that partnership, the defendants' answer denies that allegation. (See Answer, Doc. No. 8 at ¶ 16).

Under OXY's understanding of the incorporation by reference doctrine, any defendant who files a third-party complaint would necessarily be deemed to admit all the allegations of the original complaint—a result that would force defendants to either defend themselves from the underlying claims or seek contribution, but never both. The authority OXY cites in support of such a dramatic proposition falls well short of proving the point. The case OXY primarily relies on, Williamson v. Curran, 714 F.3d 432 (7th Cir.2013), simply explains that written instruments attached to a complaint are typically considered part of the complaint—but this third-party complaint doesn't attach the original Airport Authority complaint. Moreover, Williamson made clear that even attachments to a complaint should only be assumed true for purposes of a motion to dismiss if the author of the complaint relies on their contents. See 714 F.3d at 436 (“What makes it appropriate for us to consider the documents that Williamson has attached to her complaint is that she has not only cited them in the body of her complaint, but she has, to some degree, relied on their contents as support for her claims.”). These defendants not only don't rely on the truth of the Airport Authority's allegations, they explicitly deny many of them.

The only other authority OXY offers in support of its argument are two out-of-

144 F.Supp.3d 1023

circuit district court cases which recited without elaboration that they would consider the allegations in both the underlying complaint and the third-party complaint when ruling on a motion to dismiss the latter. See Erie Ins. Exch. v. Danby Products, Inc., No. CIV.A. 10–1271, 2011 WL 2470608, at *2 n. 1 (W.D.Pa. June 21, 2011) ; Railey v. S. Ry. Co., 31 F.R.D. 519, 522 (E.D.S.C.1963). Neither case provides any authority for (or even discussion of) this practice, and neither makes clear whether the third-party plaintiff denied the relevant allegations of the original complaint...