Goldberg v. 401 N. Wabash Venture LLC

• Decision Date: 11 March 2013
• Docket Number: Case No. 09 C 6455
• Parties: JACQUELINE GOLDBERG, Plaintiff, v. 401 NORTH WABASH VENTURE LLC and TRUMP CHICAGO MANAGING MEMBER LLC, Defendants.
• Court: U.S. District Court — Northern District of Illinois

JACQUELINE GOLDBERG, Plaintiff,

v.401 NORTH WABASH VENTURE LLC and TRUMP CHICAGO MANAGING MEMBER LLC, Defendants.

Case No. 09 C 6455

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

DATED: March 11, 2013

MEMORANDUM OPINION AND ORDER

AMY J. ST. EVE, District Court Judge:

On October 16, 2012, the Court granted summary judgment in favor of Defendants 401 North Wabash Venture LLC and Trump Chicago Managing Member LLC (collectively, the "Trump Defendants") on Count IV of Plaintiff Jacqueline Goldberg's ("Goldberg") Amended Complaint. (R. 169.) The Court denied summary judgment as to Count I - violations of the Illinois Condominium Property Act (the "Condominium Act"); Count II - violations of the Illinois Consumer Fraud and Deceptive Business Practices Act ("ICFA"); Count III - violations of the Federal Interstate Land Sales Full Disclosure Act ("Interstate Land Sales Act"); and Count V - Breach of Contract. (R. 48, Amend. Compl.) The Court set the case for trial on May 13, 2013. (R. 174.) The Trump Defendants now move to strike Goldberg's demand for a jury trial, arguing that Goldberg is not entitled to a jury trial based on the relief she seeks under these counts. (R. 190, Mot.) For the following reasons the Court grants the motion as to Count I, but denies it as to the remaining counts.

BACKGROUND

This action arises out of a dispute over the sale of two hotel condominium units in the Trump International Hotel and Tower in Chicago, Illinois. Goldberg "claims that the Trump defendants unlawfully lured her into signing Purchase Agreements by misrepresenting that [hotel condominium units] included the ownership and control of [] condominium common elements the hotel property and business operations, such as the ball rooms and food beverage operation." (R. 178, Pl.'s Resp. at 1.) The Court presumes familiarity with the factual and procedural background of this litigation, and incorporates herein by reference the background information set forth in the Court's written opinions dated August 24, 2012 (R. 160) and October 15, 2012 (R. 170).

LEGAL STANDARD

"The right to a jury trial in federal court hinges on federal procedural law." Dexia Credit Local v. Rogan, 629 F.3d 612, 625 (7th Cir. 2010) (citing Int'l Fin. Servs. Corp. v. Chromas Techs. Canada, Inc., 356 F.3d 731, 735 (7th Cir. 2004)). Federal Rule of Civil Procedure 38(a) preserves a party's right to a jury trial as provided by the Seventh Amendment to the Constitution or as otherwise provided by federal statute. Id; see also Fed. R. Civ. P. 38(a) ("The right of trial by jury as declared by the Seventh Amendment to the Constitution-or as provided by a federal statute-is preserved to the parties inviolate.") The Seventh Amendment provides that "[i]n Suits at common law, where the value in controversy shall exceed twenty dollars, the right of trial by jury shall be preserved . . .." U.S. Const., Amdt. 7. To determine whether a particular action will resolve legal rights and thus give rise to a jury trial right, the Court must examine both the nature of the claim for relief and the remedy sought. Id. (citing MarseillesHydro Power, LLC v. Marseilles Land & Water Co., 299 F.3d 643, 648 (7th Cir. 2002)). Specifically, the Seventh Circuit employs a two-part test. Id. First, the Court must "compare the . . . action to 18th-century actions brought in the courts of England prior to the merger of the courts of law and equity. Second, [the Court must] examine the remedy sought and determine whether it is legal or equitable in nature." Id; see also Tull v. U.S., 481 U.S. 412, 417-18, 107 S. Ct. 1831, 1835, 95 L. Ed. 2d 365 (1987). The second inquiry, regarding the nature of the remedy sought, is more important than the search for an 18th Century analogue. Id; see also Chauffeurs, Teamsters & Helpers Local No. 391 v. Terry, 494 U.S. 558, 565, 110 S. Ct. 1339, 108 L. Ed. 2d 519 (1990); Marseilles, 299 F.3d at 648.

Federal Rule of Civil Procedure 12(f) provides that a district court "may strike from a pleading an insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed. R. Civ. P.12(f); see also Delta Consulting Grp., Inc. v. R. Randle Const., Inc., 554 F.3d 1133, 1141 (7th Cir. 2009). Motions to strike pursuant to Rule 12(f) are usually discouraged. See Smith v. Bray, 681 F.3d 888, 903 (7th Cir. 2012). Motions to strike are appropriate, however, if they serve to expedite litigation, which can include striking jury demands. See, e.g., Talbot v. Robert Matthews Distrib. Co., 961 F.2d 654, 664 (7th Cir. 1992) (allegations may be stricken if the matter bears no possible relation to controversy); see also DeliverMed Holdings, LLC v. Medicate Pharm. Inc., Nos. 10-cv-684-JPG-DGW, 10-cv-685-JPG-DGW, 2012 WL 345380, at *2 (S.D. Ill. Feb. 1, 2012) (finding that the "pending motion to strike, if meritorious, may expedite the case by removing unwarranted jury demands."). The party moving to strike bears the burden of proof. See Otero v. Dart, No. 12 C 3148, 2012 WL 5077727, at *2 (N.D. Ill. Oct. 18, 2012) (citing E & J Gallo Winery v. MorandBros. Beverage Co., 247 F. Supp. 2d 979, 982 (N.D. Ill. 2003)).

ANALYSIS

As noted above, the Seventh Circuit has held that the "nature of the remedy" inquiry is the more important part of the test for whether a plaintiff's claims entitle her to a jury. Dexia, 629 F.3d at 625. In other words, "whether the remedy sought is equitable or legal in nature" will determine Goldberg's right to a jury trial on most of her claims. (Id.) The Trump Defendants argue that Goldberg's claims do not support her jury demand because she seeks "entirely equitable relief - for which the right of trial by jury does not exist." (R. 191. Def.'s Mem. at 2.) Specifically, Defendants claim that Goldberg merely seeks the equitable remedies of rescission and restitution damages to return to the status quo before Goldberg entered into the Purchase Agreements with the Trump Defendants. The Trump Defendants also argue that the Court should strike the jury demand for Count II because there is no right to a jury trial under the ICFA and Goldberg's punitive damages claims are frivolous. (Id. at 7-14.)

Goldberg does not contest that rescission is an equitable remedy or that she has no right to a jury trial if she seeks only equitable remedies. According to Goldberg, however, she seeks legal remedies, such as compensatory and punitive damages, in addition to, or as an alternative to, rescission. (R. 198, Resp. at 5-6.) In addition to rescission and an injunction, Goldberg's prayers for relief include "compensatory damages including, but not limited to, the return of her $516,487.40 in deposit monies . . . plus interest on such monies . . . and any other monetary damages available under applicable law." (See Amend. Compl. at Counts I, II, III, V.) Goldberg also argues that she can seek alternative remedies and then, after trial, pick which remedy to pursue, which she intends to do. (Resp. at 3.)

Notably, Goldberg does not directly address Defendants' arguments regarding the Condominium Act (Count I) and thus has waived any argument specifically relating to Count I. See, e.g., U.S. v. Foster, 652 F.3d 776, 792 (7th Cir. 2011) ("Failure to respond to an argument results in waiver.") Based on Goldberg's failure to address Defendants' argument that money damages are not available under the Condominium Act¹ , and the fact that Goldberg did not seek punitive damages under Count I, the Court grants Defendants' motion as to Count I because the only relief available under the Condominium Act is equitable in nature. The Court addresses the remaining counts in turn.

I. Count III (Interstate Land Sales Act) and Count V (Breach of Contract)

The prayers for relief in Count III and Count V seek an order enjoining the closing on Goldberg's HCUs; allowing Goldberg to rescind the Purchase Agreements; awarding compensatory damages including her deposit and interest "and any other monetary damages available under applicable law;" and awarding attorney's fees and costs. (Amend. Compl. at 28, 33.) The Trump Defendants acknowledge that Goldberg references "compensatory" and "other monetary damages" in her Amended Complaint, but argue that these labels are "wrong" and "irrelevant" because the only damages Goldberg has sought are those restoring the status quo, specifically, returning her deposit and any interest due on that money. (Def.'s Mem. at 4.)

Defendants note that, in her required initial Rule 26(a) disclosures, and two subsequent amendments to those disclosures, Goldberg does not provide any computation or description ofmonetary damages other than her earnest money deposit and related interest. (Reply at 3; R. 199-4, Reply Ex. B at ECF 3, 8; R. 199-4 at ECF 7 (stating that her "claims for damages include, but are not limited to, the approximately $561,000 in earnest money deposits that [she] made under the terms of the Purchase Agreements, including the interest on such deposits as well as any statutory interest allowed under the law, punitive damages, and statutory attorney's fees and costs.").) This lack of detail is not dispositive, however, as Goldberg does state in her Rule 26(a) disclosures that some of the witnesses will testify about her potential actual and compensatory damages. Moreover, whether she can prove these damages with sufficient certainty is an issue for trial, not for this motion.

Furthermore, Goldberg also seeks monetary damages explicitly in both Count III and Count V of the Amended Complaint. In Count III, she alleges that she

has been damaged through, among other things, the loss of her deposit monies, the interest on such monies, the value of her HCUs, the loss of monies and benefits she was to derive from the purchase of her HCUs, including but not limited to, her proportionate share of the revenue and commissions from the Trump Tower Meeting/function Ballrooms, unlimited use of her HCUs without impingement of her

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