Proctor v. McNeil

• Decision Date: 03 February 2014
• Docket Number: Case No. 13 C 7519
• Citation: 14 F.Supp.3d 1108
• Parties: Theresa Proctor, et. al, Plaintiffs, v. Siimone McNeil, Acting Director of Central Management Services of the State of Illinois, et al., Defendants.
• Court: U.S. District Court — Northern District of Illinois

14 F.Supp.3d 1108

Theresa Proctor, et. al, Plaintiffs,

v.Siimone McNeil, Acting Director of Central Management Services of the State of Illinois, et al., Defendants.

Case No. 13 C 7519

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

Filed February 3, 2014

Motion granted. John Daniel Carr, IGAM, Western Springs, IL, Matthew Robison, Barrido & Robison, LLC, Michael Lee Maduff, Walker R. Lawrence, Aaron Benjamin Maduff, Maduff & Maduff LLC, Chicago, IL, for Plaintiffs, Theresa Proctor, Robert Brown, Sandra Little, Kathleen Hahn, Charles McKinney, John Andrews, Dennis McManus, Cheryl Sigsbee, Zarel Lambert, Shiela Howard, Max Pierson, Janet Forgy, Roslyn Wylie, Oliver Dorsch, Mary Vitt, Marilyn Byers, Robert Heldman, Oliver Clark, Charles M. Evans, Celia Evans, Gregory Otten, Shirley Lodes, William Schowalter, Jeanine Benetier, Marcus Ahmed.

Long Xuan Truong, Richard Scott Huszagh, Office of the Illinois Attorney General, Chicago, IL, for Illinois Department of Central Management Services, State Universities Retirement System of Illinois.

MEMORANDUM, OPINION, AND ORDER

AMY J. ST. EVE, District Court Judge:

On December 5, 2013, Plaintiffs, who are retired employees of the Illinois State University System, filed the present one-count Amended Class Action Complaint alleging a Fourteenth Amendment due process claim in relation to their monthly retirement annuities and health insurance premiums. See 42 U.S.C. § 1983. Before the Court is Defendants' motion to dismiss Plaintiffs' Amended Class Action Complaint as a matter of law pursuant to Federal Rule of Civil Procedure 12(b)(6). For the following reasons, the Court grants Defendants' motion and dismisses this lawsuit in its entirety.

LEGAL STANDARD

“A motion under Rule 12(b)(6) tests whether the complaint states a claim on which relief may be granted.” Richards v. Mitcheff, 696 F.3d 635, 637 (7th Cir.2012). Under Rule 8(a)(2), a complaint must include “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). The short and plain statement under Rule 8(a)(2) must “give the defendant fair notice of what the claim is and the grounds upon which it rests.” Bell Atlantic v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citation omitted). Under the federal notice pleading standards, a plaintiff's “factual allegations must be enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555, 127 S.Ct. 1955. Put differently, a “complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009) (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955). “In reviewing the sufficiency of a complaint under the plausibility standard, [courts] accept the well-pleaded facts in the complaint as true.” Alam v. Miller Brewing Co., 709 F.3d 662, 665–66 (7th Cir.2013). A plaintiff “can plead himself out of court by pleading facts that show that he has no legal claim.” Atkins v. City of Chicago, 631 F.3d 823, 832 (7th Cir.2011).

1. 40 ILCS 5/15–135 sets forth the relevant conditions for retirement annuities. Section 15–136 sets forth the relevant calculations for retirement annuities.

Although the statute's language makes the election of the retirement annuity calculation irrevocable, there is no other language in the statute that even suggests a contractual right, such as asking for an acceptance of an offer or the word “contract.” See Unterschuetz, 346 Ill.App.3d at 73, 803 N.E.2d 988, 281 Ill.Dec. 367 . Indeed, Illinois courts have repeatedly held that “statutes governing wages, working conditions and benefits of public employees do not create any vested rights in their continued existence.” Gaiser v. Village of Skokie, 271 Ill.App.3d 85, 92, 648 N.E.2d 205, 211, 207 Ill.Dec. 749, 755 (1st Dist.1995). This is because the Illinois “legislature must be free to exercise its constitutional authority without concern that each time a public policy is expressed contractual rights may thereby be created.” Fumarolo, 142 Ill.2d at 106, 566 N.E.2d 1283, 153 Ill.Dec. 177; see also Pittman v. Chicago Bd. of Educ., 64 F.3d 1098, 1104 (7th Cir.1995) (“To treat statutes as contracts would enormously curtail the operation of democratic government. Statutes would be ratchets, creating rights that could never be retracted or even modified without buying off the groups upon which the rights had been conferred”). Based on Illinois law, Plaintiffs do not have a protected property interest for due process purposes because they do not have a contract with the State of Illinois as they allege.

Even if Plaintiffs had a protected property interest, CMS' rulemaking procedure afforded them sufficient procedural due process. “Procedural due process rights guarantee that the state not deprive an individual of his or her property without providing adequate procedural safeguards against the erroneous deprivation thereof.” Markadonatos v. Village of Woodridge, 739 F.3d 984 (7th Cir.2014). “The fundamental requirement of due process is the opportunity to be heard ‘at a meaningful time and in a meaningful manner.’ ” Mathews v. Eldridge, 424 U.S. 319, 333, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976) (citation omitted). More specifically, “the Fourteenth Amendment's Due Process Clause affords state citizens with the right to notice and an opportunity to be heard before being deprived of ‘property’ as defined by state law.” Taake v. County of Monroe, 530 F.3d 538, 543 (7th Cir.2008). “[D]ue process is flexible and calls for such procedural protections as the particular situation demands.” Morrissey v. Brewer, 408 U.S. 471, 481, 92 S.Ct. 2593, 33 L.Ed.2d 484 (1972).

It is well-settled that “[g]overning bodies may enact generally applicable laws, that is, they may legislate, without affording affected parties so much as notice and an opportunity to be heard.” Pro–Eco, Inc. v. Board of Com'rs of Jay County, Ind., 57 F.3d 505, 513 (7th Cir.1995); see also Dawson v. Milwaukee Housing Auth., 930 F.2d 1283, 1286 (7th Cir.1991) ( “the due process clause does not require individual hearings before a governmental body takes decisions that affect the interests of persons in the aggregate”); Philly's v. Byrne, 732 F.2d 87, 92 (7th Cir.1984) (“notice and opportunity for a hearing are not constitutionally required safeguards of legislative action”); see also Goros v. County of Cook, 489 F.3d 857, 859–60 (7th Cir.2007) (“it has been understood for a long time that the due process clauses do not require hearings to resolve disputes about the meaning and effect of laws, regulations, and contracts”). Simply put, “[w]here a rule of conduct applies to more than a few people it is impracticable that every one should have a direct voice in its adoption.” Muscarello v. Winnebago County Bd., 702 F.3d 909, 914 (7th Cir.2012) (quoting Bi–Metallic Investment Co. v. State Board of Equalization, 239 U.S. 441, 445, 36 S.Ct. 141, 60 L.Ed. 372 (1915) (Holmes, J.)).

“The fact that a statute (or statute-like regulation) applies across the board provides a substitute safeguard” because “the across-the-board character of legislation provides some protection against the use of the legislative process to single people out for adverse governmental action.” Philly's, 732 F.2d at 92–93 (citing United States v. Florida East Coast Ry. Co., 410 U.S. 224, 246, 93 S.Ct. 810, 35 L.Ed.2d 223 (1973)).² As the Seventh Circuit teaches:

An important reason for not requiring notice and an opportunity for a hearing when legislative action is at issue is that legislation normally is general in its scope rather than targeted on a specific individual, and its generality provides a safeguard that is a substitute for procedural protections. The greater the number of people burdened by a proposed law, the easier it is to mobilize political resistance, and the likelier moreover that the burdened class includes constituents of the legislators proposing to impose the burden. If a legislature can focus burdens laser-like on a hapless individual, he has no political remedy, while if it has to place an equal burden on many others he has a political remedy in concert with the others.

Indiana Land Co., LLC v. City of Greenwood, 378 F.3d 705, 710 (7th Cir.2004). In short, “[a] statute, unlike a judicial decision, applies directly to a whole class of people, and it is this attribute that makes democratic checking feasible, though it is far from perfect.” Coniston Corp. v. Village of Hoffman Estates, 844 F.2d 461, 469 (7th Cir.1988).

In response to Defendants' motion, Plaintiffs argue that they have a different interest at stake than the other Illinois state retirees affected by the Illinois Administrative Code at issue—such as Illinois' retired school teachers—because as retired employees of the Illinois State University System they had the option to accept a reduction in their monthly retirement annuities in exchange for premium-free health insurance pursuant to 40 ILCS 5/15–135.1. Accordingly, they claim that they are not “equally concerned” with the other retirees subject to Section 2200.520. See Bi–Metallic, 239 U.S. at 445, 36 S.Ct. 141 (assuming “that the property owners in the county all stand alike”, the “question, then, is whether all individuals have a constitutional right to be heard before a matter can be decided in which all are equally concerned”). More specifically, Plaintiffs contend that they comprise approximately 3,000 to 6,000 individuals, and that relative to the purported “hundreds of thousands” of retirees subject to Section 2200.50, they are a “tiny class of people.” See Philly's, 732 F.2d at 93 (“More may be required especially in a case like this where the legislation affects only a tiny class of people—maybe a class with only one member.”). As the Seventh Circuit clarifies, “the tinier the...