Halprin v. Prairie Single Family Homes

• Decision Date: 02 July 2002
• Docket Number: No. 01 C 4673.,01 C 4673.
• Citation: 208 F.Supp.2d 896
• Court: U.S. District Court — Northern District of Illinois
• Parties: Robyn HALPRIN and Rick Halprin, both individually and derivatively, as members of the Prairie Single Family Homes of Dearborn Park Association, an Illinois corporation, on its behalf, Plaintiffs, v. THE PRAIRIE SINGLE FAMILY HOMES OF DEARBORN PARK ASSOCIATION, an Illinois Corporation; Mark Ormond, individually and as an officer, director, and agent of The Prairie Single Family Homes of Dearborn Park Association; John Hooker, individually and as an officer, director, and agent of The Prairie Single Family Homes of Dearborn Park Association; Downs, Mohl & Company, an Illinois corporation; and David Mohl, individually and as an officer and agent of Downs, Mohl & Company and as an agent of The Prairie Single Family Homes of Dearborn Park Association, Defendants.

208 F.Supp.2d 896

Robyn HALPRIN and Rick Halprin, both individually and derivatively, as members of the Prairie Single Family Homes of Dearborn Park Association, an Illinois corporation, on its behalf, Plaintiffs, v. THE PRAIRIE SINGLE FAMILY HOMES OF DEARBORN PARK ASSOCIATION, an Illinois Corporation; Mark Ormond, individually and as an officer, director, and agent of The Prairie Single Family Homes of Dearborn Park Association; John Hooker, individually and as an officer, director, and agent of The Prairie Single Family Homes of Dearborn Park Association; Downs, Mohl & Company, an Illinois corporation; and David Mohl, individually and as an officer and agent of Downs, Mohl & Company and as an agent of The Prairie Single Family Homes of Dearborn Park Association, Defendants.

No. 01 C 4673.

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

July 2, 2002.

Thomas M. Peters, Kevin R. Peters, Chicago, IL, for Plaintiffs.

Mark Daniel Roth, Diana M. Kenney, Orum & Roth, Chicago, IL, for Defendants.

MEMORANDUM OPINION AND ORDER

ALESIA, District Judge.

Before the court are (1) defendants' motion to dismiss Counts I-III, V, and VII of plaintiffs' second amended complaint, and (2) defendants' motion to quash a subpoena seeking billing for Prairie Homes from September 1999 to the present. The court grants in part and denies in part defendants' motion to dismiss as follows. The court grants defendants' motion to dismiss Counts I-III, involving the Fair Housing Act. On its own motion, the court dismisses without prejudice Counts IV-VII, the remaining state law claims in plaintiffs' amended complaint. The court denies as moot defendants' motion to dismiss Counts V and VII and defendants' motion to quash.

I. BACKGROUND

The following facts are taken from plaintiffs' second amended complaint and are assumed to be true for the purposes of defendants' Rule 12(b)(6) motion to dismiss. Plaintiff Robyn Halprin ("Robyn") owned a home in a subdivision known as The Prairie Single Family Homes of Dearborn Park ("the Subdivision") in Chicago, Illinois. Robyn was engaged or married to Plaintiff Rick Halprin ("Rick"), who is Jewish. On or after January 8, 2001, Rick became a co-owner of the home.

Defendant The Prairie Single Family Homes of Dearborn Park Association (the "Association") was a not-for-profit corporation organized under the laws of the State of Illinois for the purpose of managing and providing services for the benefit of persons owning homes in the Subdivision. Defendant Mark Ormond ("Ormond") was a resident of the Subdivision, and a member and officer of the Association. Defendant Downs, Mohl & Company ("Downs, Mohl") was a business corporation organized under the laws of the State of Illinois, whose business activities included the provision of management services to the Association. Defendant David Mohl ("Mohl") was the President and an employee of Downs, Mohl.

Problems began around November 2, 2000, when Robyn was not elected to one of two vacant Director seats on the Association's Board and Ormond refused to inform Robyn how many proxy votes had been cast in the election. Robyn believed that Ormond strategically used proxies to maintain control of Association elections. The Association also refused Robyn's December 2000 requests for documents pertaining to matters such as the Association's spending practices and conduct of its Board elections.

At some time between December 20, 2000 and January 10, 2001, Ormond vandalized Robyn's home by writing with a red marking pen on a stone wall the phrase "H-town property." Plaintiffs allege that "H-town" is a shorthand version of the derogatory slang term "Hymie Town," which refers to places where Jewish persons reside. Ormond further vandalized their home by damaging plants and trees and cutting down strings of holiday lights. Shortly after the vandalism incident, Robyn posted flyers offering a reward for information identifying the vandals. She posted the flyers on light poles and trees which comprised public, non-Association property. Ormond removed or destroyed the reward notices and instructed the Association's lawyer to exert pressure on the City of Chicago Departments of Streets and Sanitation to demand removal of the signs. Also, on January 8, 2001, Ormond blocked Robyn's attempt to address the Board regarding Association management.

In an effort to investigate the vandalism, plaintiffs asked Mohl for copies of Association records that could be handwriting exemplars for Ormond. Mohl agreed but delayed the availability of the records with the intent to destroy or fabricate documents. Also, one or more of defendants altered Board minutes and destroyed a tape recording of a September 25, 2000 board meeting to hide the fact that Ormond threatened to "make an example" of Robyn.

On February 6, 2001, Mohl notified plaintiffs that they would be charged at a February 13, 2001 Board meeting with violating the Association's Declaration of Easements, Restrictions and Covenants by posting a notice of reward and request for information concerning the vandalism incident. The notice stated that plaintiffs had already been found guilty and the Board was to consider legal sanctions and fines. Then, on February 13, 2001, in front of fifteen members of the Association, the Board's representative threatened to force plaintiffs to sell their home if they did not remove the reward sign. After the meeting, the Association President, defendant John Hooker ("Hooker"), wrote a letter thanking the members who attended the meeting for supporting the threats made against plaintiffs.

In addition, defendants have applied chemicals to plaintiffs' yard despite plaintiffs' request not to do so and despite having been informed of the effects the chemicals were having on Robyn's health and peace of mind. The defendants have also enacted or purported to enact several new rules targeted solely at restricting the freedom of plaintiffs to enjoy the use of their home—for example, defendants passed new rules prohibiting plaintiffs from storing firewood in their yard or building a deck on their property, and displacing Robyn's garden.

As a result of these disputes, plaintiffs filed a seven-count second amended complaint against defendants. Count I is a claim for violation of the Fair Housing Act ("FHA"), 42 U.S.C. §§ 3604(b), 3604(c) and 3617 (" § 3604" and " § 3617"). Count II is a claim for conspiracy to violate §§ 3604 and 3617. Count III is a claim for aiding and abetting acts prohibited by § 3604, in violation of § 3617. Count IV is a claim for violation of the Illinois Hate Crimes Act, 720 ILL. COMP. STAT. 5/12-7.1. Count V is a claim for breach of fiduciary duty under 805 ILL. COMP. STAT. 105/107.75 and 765 ILL. COMP. STAT. 605/18.5. Count VI is a claim for trespass, conversion, and damage to property. Count VII is a claim for return of fees paid and damages.

Before the court are (1) defendants' motion to dismiss Counts I-III, V, and VII of plaintiffs' second amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), and (2) defendants' motion to quash a subpoena seeking billing for Prairie Homes from September 1999 to the present. This court has jurisdiction over plaintiffs' FHA claims in Counts I-III under 28 U.S.C. § 1331 as they arise under federal law. The court has supplemental jurisdiction over plaintiffs' state law claims in Counts IV-VII, pursuant to 28 U.S.C. § 1367(a).

II. DISCUSSION

A. Standard for deciding a rule 12(b)(6) motion to dismiss

In addressing defendants' motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the court must accept all factual allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. Gomez v. Illinois State Bd. of Educ., 811 F.2d 1030, 1039 (7th Cir.1987); Cromley v. Bd. of Educ. of Lockport, 699 F.Supp. 1283, 1285 (N.D.Ill. 1988). The purpose of a motion to dismiss is not to decide the merits of the challenged claims but to test their sufficiency under the law. Gibson v. City of Chicago, 910 F.2d 1510, 1520 (7th Cir.1990). In deciding a motion to dismiss, the court reads the complaint liberally, dismissing the complaint only if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which entitles him to relief. Conley v. Gibson, 355 U.S. 41, 45, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). "[I]f it is possible to hypothesize a set of facts, consistent with the complaint, that would entitle the plaintiff to relief, dismissal under Rule 12(b)(6) is inappropriate." Sanville v. McCaughtry, 266 F.3d 724, 732 (7th Cir.2001) (quoting Veazey v. Communications & Cable of Chi., Inc., 194 F.3d 850, 854 (7th Cir.1999)). Nevertheless, in deciding a motion to dismiss for failure to state a claim, the court need not ignore allegations that undermine the plaintiff's complaint, or assign any weight to unsupported conclusions of law. See N. Ind. Gun & Outdoor Shows, Inc. v. City of South Bend, 163 F.3d 449, 452 (7th Cir. 1998). Also, although the Federal Rules of Civil Procedure provide a liberal notice pleading standard, the complaint must include either direct or inferential allegations with respect to all material elements of the claims asserted. Perkins v. Silverstein, 939 F.2d 463, 466 (7th Cir.1991). With these standards in mind, the court assesses defendants' motion to dismiss.

B. Federal claims

Counts I-III of plaintiffs' second amended complaint are brought under Title VIII of the Civil Rights Act of 1968, 42 U.S.C. §§ 3601-3619 (the FHA), particularly §§ 3604(b), 3604(c) and 3617. Title VIII is designed to root out discrimination in the housing market. N.A.A.C.P v. Am. Family Mut. Ins. Co., 978 F.2d 287, 298 (7th Cir.1992). See South-Suburban Hous. Ctr. v. Greater S. Suburban Bd. of Realtors, 935 F.2d 868, 882 (7th Cir.1991) ("The Fair Housing Act is concerned with both the furtherance of equal housing opportunity and the elimination of...