Hapaniewski v. City of Chicago Heights

• Decision Date: 28 June 1989
• Docket Number: No. 88-1960,88-1960
• Citation: 883 F.2d 576
• Parties: William P. HAPANIEWSKI and Edward Janski, Plaintiffs-Appellants, v. CITY OF CHICAGO HEIGHTS, a municipal corporation; et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 576

883 F.2d 576

14 Fed.R.Serv.3d 786

William P. HAPANIEWSKI and Edward Janski, Plaintiffs-Appellants, v. CITY OF CHICAGO HEIGHTS, a municipal corporation; et al Defendants-Appellees.

No. 88-1960.

United States Court of Appeals, Seventh Circuit.

Submitted June 28, 1989. ^*

Decided Aug. 25, 1989.

Edward L. Janski, Chicago, Ill., Steve H. Tokarski, Schererville, Ind., for plaintiffs-appellants.

Linley E. Pearson, Atty. Gen., Office of the Atty. Gen., Indianapolis, Ind., for defendants-appellees.

Before MANION and KANNE, Circuit Judges, and PELL, Senior Circuit Judge.

PELL, Senior Circuit Judge.

Plaintiffs-appellants William Hapaniewski ("Hapaniewski") and Edward Janski ("Janski") appeal the district court's denial of their motion to transfer venue and extend time to perfect service of process. They also appeal the district court's dismissal of their complaint, entry of sanctions against them pursuant to Fed.R.Civ.P. 11, and denial of their emergency Fed.R.Civ.P. 60(b) motion to reconsider their request to transfer venue and extend time to perfect service.

I.

On April 13, 1981, Hapaniewski filed suit against the City of Chicago Heights ("City") in Illinois state court, claiming violations under state and federal statutory law (42 U.S.C. Sec. 1983) and under the state and federal constitutions. ¹ On City's motion, the Illinois trial court dismissed Hapaniewski's claims as time-barred by a two-year statute of limitations. The Illinois Appellate Court affirmed, and a subsequent petition for rehearing and motion for leave to appeal to the Illinois Supreme Court were denied.

On February 12, 1987, Hapaniewski filed a complaint in federal district court reciting the same four counts from the state court action but adding two new counts against the judges in the state trial and appellate courts. Although the complaint recited "Northern District of Illinois--Eastern Division" as its heading, the complaint was actually filed in the "Northern District of Indiana--Hammond Division." (Civil No. 87-C-105). In April of 1987, Hapaniewski filed a petition for a writ of certiorari to the United States Supreme Court. On July 28, 1987, the United States District Court for the Northern District of Indiana--Hammond Division issued a Rule 36(b) Notice which indicated that the complaint would be dismissed unless good cause could be shown why service of process had not been made on the defendants within the required 120-day period. See N.D.Ind. Local Rule 36(b).

On August 5, 1987, both Hapaniewski and Janski (who are brothers and attorneys) filed responses in the Northern District of Indiana--Hammond Division, asking for an additional thirty days to perfect service of process. Two weeks later, Janski obtained approval to act as counsel until local counsel could be retained. At the granting of this motion, the court directed that Hapaniewski had until September 16, 1987 to perfect service. On September 14, 1987, however, Hapaniewski filed a motion seeking to have the court transfer venue "in the interest of justice" under 28 U.S.C. Sec. 1406(a), and also requesting an additional thirty-day extension to perfect service of process. On October 5, 1987, while the motion to transfer was pending, the United States Supreme Court vacated the Illinois Appellate Court's judgment which had affirmed the dismissal of Hapaniewski's state court case on statute of limitation grounds. Hapaniewski v. City of Chicago Heights, 484 U.S. 806, 108 S.Ct. 53, 98 L.Ed.2d 17 (1987) (remanded in light of Goodman v. Lukens Steel Company, 482 U.S. 656, 107 S.Ct. 2617, 96 L.Ed.2d 572 (1987)).

On April 17, 1988, the United States District Court for the Northern District of Indiana--Hammond Division filed its judgment denying the motion to transfer venue, dismissing the action, and imposing sanctions on both Hapaniewski and Janski. 684 F.Supp. 1011 (N.D.Ind.1988). The court denied the motion to transfer venue because it found: (1) the plaintiffs easily could have filed their complaint in an Illinois federal district court; (2) the plaintiffs conceded and the court could not disagree that the court could not assert personal jurisdiction in any way over the defendants; (3) the plaintiffs as attorneys should have known that venue was improperly laid; and (4) this error, surfacing seven months after the initial filing of the complaint and five months after the statute of limitations had run, was not the kind of innocent "mistake" found in Goldlawr, Inc. v. Heiman, 369 U.S. 463, 467, 82 S.Ct. 913, 916, 8 L.Ed.2d 39 (1962). The district court also noted that the defendants would "be greatly prejudiced because the statute of limitations ha[d] run and defendants ha[d] not received notice of the suit...."

The court additionally determined that the suit was "frivolous, vexatious and not warranted by existing law...." The court analyzed the three elements required for application of res judicata. See Torres v. Rebarchak, 814 F.2d 1219, 1222 (7th Cir.1987). The court reviewed Illinois case law and concluded that the dismissal by the Illinois state court on statute of limitations grounds "operate[d] as a dismissal on the merits." (citations omitted). The court reasoned that since the prior Illinois state proceeding had preclusively decided all "issues actually litigated" and also "those issues which could have been litigated," and since the state court judgment was a final adjudication of the matter, res judicata barred retrial in federal court.

Finally, the district court determined that both Hapaniewski and Janski violated Rule 11 for failing to properly inquire about the legal viability of their claims. The court specifically relied on the "established doctrines of full faith and credit" and res judicata in finding a violation of Rule 11 and imposing a $1,500.00 fine on each attorney. The local counsel, Steve H. Tokarski, was not fined because his name did not appear on any document of Hapaniewski's, but was warned by the court to "not take his position lightly...."

II.

Hapaniewski and Janski filed an emergency motion to reconsider the sanctions order and the denial of the motion to transfer venue, and a motion to stay the order pending appeal. The court denied the request, indicating that res judicata was a valid reason for imposing sanctions on the appellants despite the fact that the Supreme Court vacated the state court decision. The district court reasoned that the Supreme Court's action did not affect its decision but noted that pursuing the writ of certiorari was the proper method for redressing the state court's decision. The court also cited the appellants' failure to file in the proper forum and failure to allege jurisdiction over the defendants as proper reasons for invoking sanctions. Finally, the district court reviewed its decision to dismiss rather than transfer the case, and determined that that decision would not be disturbed. Hapaniewski and Janski timely appealed the district court's denial of the motion to reconsider pursuant to Fed.R.Civ.P. 60(b), and the prior judgment of the district court.

III.

Hapaniewski and Janski contend that the district court abused its discretion in rejecting their Fed.R.Civ.P. 60(b) emergency motion to vacate the judgment, stay the order imposing sanctions, and reconsider the motion to transfer venue. The standard for reviewing the denial of a Rule 60(b) motion is well-established. We will overturn such a denial only if the district court abused its discretion. See In re Wildman, 859 F.2d 553, 557 (7th Cir.1988) (citing Browder v. Director, Dep't. of Corrections, 434 U.S. 257, 263 n. 7, 98 S.Ct. 556, 560 n. 7, 54 L.Ed.2d 521 (1978); Mumford v. Bowen, 814 F.2d 328, 329 (7th Cir.1986)). This is the same standard that this court applies to review the denial of the motion to transfer venue pursuant to 28 U.S.C. Sec. 1406(a).

Under 28 U.S.C. Sec. 1406(a), a district court may "transfer a case brought in the wrong division or district if" it is "in the interest of justice" to do so. Saylor v. Dyniewski, 836 F.2d 341, 345 (7th Cir.1988). A district court must dismiss such a suit if it denies the transfer. 28 U.S.C. Sec. 1406(a). However, personal jurisdiction over the defendant is not a prerequisite for district courts to utilize the transfer provision in Sec. 1406(a). Saylor, 836 F.2d at 345 (citing Goldlawr, Inc., 369 U.S. 463, 82 S.Ct. 913; Cote v. Wadel, 796 F.2d 981, 985 (7th Cir.1986)). Nonetheless, our review on appeal of the district court's judgment not to transfer is limited to whether the district court clearly abused its discretion. Saylor, 836 F.2d at 345 (quoting Piper Aircraft Co. v. Reyno, 454 U.S. 235, 237, 102 S.Ct. 252, 256, 70 L.Ed.2d 419 (1981)); see also Cote, 796 F.2d at 985.

In the instant case, Hapaniewski and Janski have not demonstrated that the district court clearly abused its discretion. Collectively, the appellants claim first that they meant to file in Illinois federal court, as evidenced by the heading on the complaint itself, and claim that by some mistake, the document was filed in Indiana. We cannot conclude here that the error in filing was the kind envisioned by the United States Supreme Court in Goldlawr, Inc., 369 U.S. at 467, 82 S.Ct. at 916. Without even questioning their initial intent, the record reveals that Hapaniewski and Janski pursued the federal court action in Indiana despite the fact that two months remained under the statute of limitations for filing in Illinois federal court and despite the fact that they knew that all the parties were residents of Illinois. Hapaniewski and Janski obtained local counsel and sought extensions to attempt to serve process on the defendants. And as the district court noted, it was not until two days before the deadline for effecting service that Hapaniewski and Janski asked to have the action transferred to an Illinois federal court. These actions by the appellants do not reflect a need for a transfer of venue "in the ...