Kelly v. Bank Midwest, N.A.
| Decision Date | 27 July 2001 |
| Docket Number | No. 00-2042-JWL.,00-2042-JWL. |
| Citation | 161 F.Supp.2d 1248 |
| Parties | Dederick KELLY, Plaintiff, v. BANK MIDWEST, N.A., Defendant. |
| Court | U.S. District Court — District of Kansas |
John W. Kurtz, Hubbard & Kurtz, L.L.P., Kansas City, MO, for plaintiff.
Daniel D. Crabtree, Stinson, Mag & Fizzell, P.C., Leawood, KS, Brian R. Markley, Stinson, Mag & Fizzell, P.C. Kansas City, MO, for defendant.
Plaintiff filed suit against defendant alleging false arrest, negligent and intentional infliction of emotional distress, and race discrimination arising out of plaintiff's visits to defendant's branch in Kansas City, Kansas for purposes of obtaining a loan. This matter is presently before the court on defendant's motion for summary judgment (doc. # 35) with respect to plaintiff's claim of race discrimination pursuant to 42 U.S.C. § 1981. As set forth in more detail below, defendant's motion with respect to this claim is denied. Moreover, while the court previously granted defendant's motion with respect to plaintiff's state law claims during a telephone conference, the court elaborates on its rulings with respect to those claims below.
On January 5, 2001, the court held a telephone conference during which it granted defendant's motion for summary judgment with respect to plaintiff's claims of false arrest and negligent and intentional infliction of emotional distress. The court retained under advisement defendant's motion with respect to plaintiff's section 1981 claim pending the appeal of Hampton v. Dillard Dep't Stores, Inc., 985 F.Supp. 1055 (D.Kan.1997) and 18 F.Supp.2d 1256 (D.Kan.1998), a case which concerned, in part, the proper scope of section 1981. The Tenth Circuit has now issued its order, Hampton v. Dillard Dep't Stores, Inc., 247 F.3d 1091 (10th Cir.2001), and the court is prepared to rule on defendant's motion with respect to plaintiff's section 1981 claim. Moreover, because the court granted summary judgment on plaintiff's state law claims during a telephone conference, the court, for the benefit of the parties, will use this opportunity to explain in more detail its analysis concerning plaintiff's state law claims.
The following facts are either uncontroverted or related in the light most favorable to plaintiff, the nonmoving party. Defendant Bank Midwest is a bank which operates branches in northern Missouri and eastern Kansas. One of defendant's branches is located at 78th Street and State Avenue in Kansas City, Kansas. Plaintiff Dederick Kelly, an African American male, visited this location on three consecutive days in February 1999. His claims in this suit arise out of certain events occurring at the bank over this three-day period in connection with plaintiff's efforts to obtain a loan.
On February 17, 1999, plaintiff and his brother, Willie Kelly,1 went to defendant for the purpose of securing a loan. Specifically, both plaintiff and his brother intended to purchase a certificate of deposit (CD) for $1000 and, at the same time, borrow $1000 using the CD as collateral. According to plaintiff, the purpose of this transaction was to allow plaintiff and his brother to reestablish their credit. To purchase the CD, plaintiff and his brother each presented a document entitled "Official Check." The checks reflected that they were issued by Mercantile Bank on the previous day, February 16, 1999. One of the two checks was purchased by plaintiff and made payable to his brother. The other check was purchased by Willie Kelly and made payable to plaintiff.
Upon entering the bank, plaintiff and/or his brother advised the receptionist of the type of transaction they wanted to complete. The receptionist advised them that they would be helped by the next available person. After waiting for approximately 15 or 20 minutes, one of defendant's customer service representatives, Kellie Hunt, approached the brothers and stated that she could help either of them. Willie Kelly then followed Ms. Hunt to her desk. Approximately 5 to 10 minutes later, plaintiff was assisted by Cathy Turner, the supervisor of the customer service representatives.
Before turning to plaintiff's encounter with Ms. Turner, it is helpful to review the circumstances surrounding Willie Kelly's encounter with Ms. Hunt. As per her standard procedure, Ms. Hunt initially copied Willie Kelly's driver's license and contacted Chex Systems to inquire whether Willie Kelly had had any closed accounts due to insufficient funds. She discovered that Willie Kelly had bounced at least one check drawn on an Oklahoma bank. Under defendant's policy, this prevented Ms. Hunt from opening an account for Willie Kelly and this was apparently communicated to Willie Kelly. Ms. Hunt then contacted defendant's fraud and forgery officer, Bill Hall, because she was apparently "concerned" about Willie Kelly, primarily because he presented an Oklahoma driver's license with a Kansas City, Missouri address and because Ms. Hunt did not believe that Willie Kelly looked like the picture on the driver's license. Mr. Hall proceeded to run a criminal background check on Willie Kelly.2 The check revealed two outstanding warrants for Willie Kelly's arrest. One of the warrants was followed by an asterisk. Mr. Hall had apparently never seen an asterisk following a warrant during any of the checks he had performed. Mr. Hall told Ms. Hunt about the warrants, their nature and his "concern" about the asterisk. Mr. Hall then asked Ms. Hunt to notify the bank's security guard about "what was going on." He also asked her to send him copies of any identification information and copies of the Official Checks. After receiving a copy of the checks, Mr. Hall called the security fraud department at Mercantile Bank to ask whether Mercantile issued an instrument called an "Official Check." At the request of Mercantile, he faxed to Mercantile a copy of the two checks. After reviewing the fax, Mercantile agents believed that the Official Checks were in fact issued by Mercantile. Mr. Hall then asked Mercantile to verify that the Official Checks were not stolen. Mercantile indicated that it would contact the customer (presumably one or both of the Kelly brothers) to find out the answer and would report back to Mr. Hall.
In the meantime, before contacting the security guard, Ms. Hunt telephoned Ms. Turner, who was assisting plaintiff with his loan application. Ms. Hunt told Ms. Turner about everything that she had learned up to that point. At some point during the phone call, Ms. Turner told Ms. Hunt that plaintiff was seeking the same transaction as Willie Kelly. Despite some apparent concerns with plaintiff's transaction (namely, the fact that each of the Kelly brothers had purchased one check made payable to the other and that plaintiff did not look like his driver's license picture), Ms. Turner helped plaintiff complete a loan application. She also photocopied his driver's license and the Official Check. Ms. Turner then advised plaintiff that the bank would contact him the next day regarding the status of his application. At that point, Ms. Turner gave plaintiff's application materials to Ms. Hunt for further processing.
In the meantime, Ms. Hunt "explained everything" to the bank's security guard on duty, Victor Grabbe. Mr. Grabbe, for whatever reason, also looked at the pictures on both plaintiff's and Willie Kelly's driver's licenses. He determined that the Kelly brothers did not look like the pictures on their respective licenses. Mr. Grabbe was also concerned that the requested transaction resembled a form of fraud called a "split deposit"—when a individual deposits a check and withdraws some portion of the deposit in cash before it is discovered that the deposited check is worthless for some reason. Mr. Grabbe contacted his supervisor and explained his concerns. He also expressed concern to his supervisor that the brothers were in separate areas of the bank and that each of the brothers was "larger" than Mr. Grabbe. Mr. Grabbe's supervisor advised Mr. Grabbe that he "might want to call the police for assistance as there were two of them." Mr. Grabbe called the police to request assistance. No police officer ever responded or appeared at the bank on that day and the Kelly brothers left the bank without incident. After the Kelly brothers left the bank, Mr. Grabbe wrote a Branch Activity Report and Memorandum—a form that security guards regularly complete about events that happen at the branch while they are on duty.
On the morning of February 18, 1999, plaintiff called Ms. Turner to inquire about the status of his loan. Ms. Turner apparently indicated that the bank would be unable to process his loan because some of the information he presented to the bank made the bank personnel "uncomfortable." When pressed for details, Ms. Turner told plaintiff that one of the loan officers had driven by a property that plaintiff had identified on his loan application and that the officer had reported that the property was a vacant lot. Plaintiff informed Ms. Turner that his property was not a vacant lot. She also mentioned that plaintiff's social security number did not match his driver's license number. Plaintiff advised Ms. Turner that he purposefully used a different number on his driver's license for security and privacy reasons. Plaintiff then asked to speak to whomever was in charge at the branch. He was put in touch with Bart Nill, the branch manager. Mr. Nill apparently reiterated Ms. Turner's concerns. Plaintiff advised Mr. Nill that he would bring to the bank additional documentation to verify the information in his loan application. Plaintiff gathered additional materials, including real property appraisals, and returned to the bank.
During this same time frame, a representative from Mercantile contacted Mr. Hall and allegedly stated that she had spoken to the customer ...
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