Robertson v. White
| Decision Date | 04 April 1986 |
| Docket Number | 85-2096,No. 85-2044,85-2155 and 85-2259.,85-2044 |
| Citation | 633 F. Supp. 954 |
| Parties | Thomas E. ROBERTSON, Jr., As Trustee of the Farmer's Co-Op of Arkansas and Oklahoma, Inc.; Bob Reves; Frances Graham; Robert H. Gibbs, individually; Robert H. Gibbs, as natural guardian of his minor children Thomas A. Gibbs and Robert H. Gibbs, Jr.; and Robert H. Gibbs, as Trustee of the Muskogee Internal Medicine Group Profit Sharing Funds, Plaintiffs, and Intervening Plaintiffs v. Jack E. WHITE; J.E.W., Inc.; Valley Feeds, Inc.; Gene Kuykendall and Fred Kuykendall, individually and d/b/a Kuykendall & Kuykendall, a partnership; Oran Moody, Jr. and Michael O. Moody, individually and d/b/a Moody & Moody, a partnership; Arthur Young & Company; Harry C. Erwin; Billy Joe Cabaniss, Jr.; Joseph F. Drozal, Jr.; Charles M. Hanson; Hal Brewer; Waldo Price; Truman O. Boatright; J.O. McClure; Hugh Winfrey, Jr.; M.V. Creech; Charles Bane; E.H. Pritchett, Jr.; Robert Plunkett; Ralph McClure; Jimmy Don Gooch; Jerry Metzger; W.J. Rimmer; Don Sebo; Joe Wayne Harris; James Willis; Dan Ray Core; Harold Davis; Jay Freeman; Jay Neal, Jr.; George Wagnon; Raymond (Jack) Clark; Carl Creekmore and Morril H. Harriman, Jr., individually and d/b/a Creekmore & Harriman, a partnership; E.J. Ball, Kenneth R. Mourton, and Stephen E. Adams, individually and d/b/a Ball, Mourton & Adams, a partnership; Kirit Goradia; Eddie Joe Smith; and John Does 1-20, Defendants. |
| Court | U.S. District Court — Western District of Arkansas |
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Gary M. Elden, Daniel A. Edelman, John R. McCambridge, Kevin J. Waite, Reuben & Proctor, Christopher J. Doherty, Isham, Lincoln & Beale, Chicago, Ill., for plaintiff, Thomas E. Robertson, Jr., As Trustee of the Farmer's Co-op of Arkansas and Oklahoma.
Robert R. Cloar, Fort Smith, Ark., for intervening plaintiffs: Bob Reves, Frances Graham, Robert H. Gibbs, as Natural Guardian of His Minor Children, Thomas A. Gibbs and Robert H. Gibbs, Jr., and Robert H. Gibbs, as Trustee of the Muskogee Internal Medicine Group Profit Sharing Funds, and Bob Reves, Frances Graham, and Robert H. Gibbs as Class and Subclass Representatives.
Carl Liggio, John Matson, New York City, for Arthur Young & Co., Harry C. Erwin, Billy Joe Cabaniss, Jr., Joseph F. Drozal, Jr., Charles M. Hanson.
James M. Roy, Jr., Roy, Mashburn & Lambert, Springdale, Ark., for Arthur Young & Co.
Fred H. Harrison, University of Arkansas, Little Rock, Ark., for W.J. Rimmer.
Fines F. Batchelor, Jr., Van Buren, Ark., for Truman O. Boatright, Hugh Winfrey, Jr., Jimmy Don Gooch, Ralph McClure, Joe Wayne Harris, James Willis, Dan Ray Core, Harold Davis, Jay Freeman.
Mr. Carl Creekmore, Mr. Morril H. Harriman, Jr., Van Buren, Ark., for Carl Creekmore and Morril H. Harriman, Jr., Ind. and d/b/a Creekmore & Harriman, a partnership.
Jerry Lee Canfield, Daily, West, Core, Coffman & Canfield, Fort Smith, Ark., for Citizens Bank & Trust Co.
Robert L. Jones, III, Jones, Gilbreath & Jones, Fort Smith, Ark., for Gene Kuykendall and Fred Kuykendall, Ind. and d/b/a Kuykendall & Kuykendall, a partnership.
Thomas B. Pryor, Pryor, Robinson and Barry, Fort Smith, Ark., for Oran Moody, Jr. and Michael O. Moody, Ind. and d/b/a Moody and Moody, a partnership.
Eddie N. Christian, Christian & Beland, Fort Smith, Ark., for Jack E. White, J.E.W., Inc., Valley Feeds, Inc.
Jim Jones, Sallisaw, Okl., for M.V. Creech, Charles Bane, Jerry Metzger.
Jerry D. Pruitt, Pruitt & Hodnett, Fort Smith, Ark., for Hal Brewer, Don Sebo, E.H. Pritchett, Jr.
Kenneth R. Mourton, Ball, Mourton and Adams, Fayetteville, Ark., for Ball, Mourton & Adams, a partnership.
Mark A. Grober, Sandlin, Payne & Grober, Muskogee, Okl., for Robert Plunkett.
S. Walton Maurras, Harper, Young, Smith & Maurras, Fort Smith, Ark., for George Wagnon, Raymond (Jack) Clark, Eddie Joe Smith, Waldo Price, J.O. McClure.
Ronald D. Harrison, Harrison and Hewett, Fort Smith, Ark., for Kirit Goradia.
James B. Blair, Springdale, Ark., for E.J. Ball, Kenneth R. Mourton and Stephen E. Adams, Ind. and d/b/a Ball, Mourton & Adams.
James A. Arnold, II, Shaw, Ledbetter, Hornberger, Cogbill & Arnold, Fort Smith, Ark., for Jay Neal, Jr.
Gary D. Corum, Wilson, Engstrom, Corum & Dudley, Little Rock, Ark., for Harry Erwin.
Defendants have filed numerous objections to Magistrate Ned A. Stewart, Jr.'s Proposed Findings and Recommendations denying their motions challenging the sufficiency of the plaintiffs' consolidated complaint, under Federal Rules of Civil Procedure (FRCP) Rule 12(b)(6). These objections are before this court pursuant to 28 U.S.C. Sec. 636(b)(1).
Plaintiffs in this action are Thomas Robertson, Jr., Trustee in bankruptcy for the Farmer's Co-op of Arkansas and Oklahoma, Inc., and Bob Reves, et al, a class of plaintiffs composed of Co-op members, distributees of unpaid Co-op patronage dividends and holders of Co-op demand notes.
There are 36 defendants, plus 1-20 "John Does", and, cumulatively, their motions cover the field, touching all 16 causes of action, whether asserted by the Trustee or by the class. The court has determined to address these questions collectively, and to address only those motions which question whether the complaint states a cause of action. Questions of limitations, etc., will be reserved for summary judgment should the parties wish to raise them.
Motions under rule 12(b)(6) of the Rules of Civil Procedure must accept all facts stated by the plaintiff to be true. Jenkins v. McKeithen, 395 U.S. 411, 421, 89 S.Ct. 1843, 1848-49, 23 L.Ed.2d 404 (1969). The court notes this elementary point for two reasons. First, in many cases, defendants' motions took extended issue with the truth of statements in the plaintiffs' complaint. In olden days, 12(b)(6) motions were called demurrers. A demurrer which took issue with matters raised by the complaint, or which sought to enlarge the complaint by pleading additional facts, was called a "speaking demurrer". It was customary for courts to deny such pleadings because they spake. In this case, if defendants' demurrers could talk, what tales they would tell! Defendants have invited the court to peruse argumentative exhibits consisting of publications from accounting societies, affidavits from parties, depositions, interrogatories, resumes, job descriptions, statements of witnesses, and you name it. Plaintiffs have filed responses including exhibits ranging from Business Week opinion pieces, affidavits from eminent accountants, letters from their clients, legal bills, newspaper articles about Capitol Hill doings, etc. As a consequence, the file of motions, briefs, and exhibits is some two feet thick. The primary reason, therefore, for stating such an elementary point at the head of this opinion is to express some measure of the court's irritation at the flouting of Rules of Civil Procedure by counsel on both sides in this case.
In addition, the court perceives that in this case a large percentage of parties on both sides are said to be relatively unsophisticated litigants, at least in the sense that they probably have had few contacts with the civil court system. The court desires that all parties reading this opinion be aware that in making a recital of the allegations of the plaintiffs' complaint, the court in no way indicates a belief in the statements, it rather assumes their truth for purposes of argument.
Conley v. Gibson 355 U.S. 41, 45, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957) established the standard this court must use in determining the validity of plaintiffs' claims, upon a defendant's Rule 12(b)(6) motion: "In appraising the sufficiency of the complaint we follow, of course, the accepted rule that a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." This standard is, of course, quite liberal. The court is obliged to construe the complaint so as to do substantial justice. FRCP Rule 8(f). The purpose of pleading is to facilitate a proper decision on the merits. Maty v. Grasselli Chemical Co., 303 U.S. 197, 58 S.Ct. 507, 82 L.Ed. 745 (1938). The Rules exist to "secure the just, speedy, and inexpensive determination of every action." FRCP, Rule 1. These are preliminary observations to a discussion to be undertaken later with respect to the sufficiency of the plaintiffs' fraud complaints. A too-strict, fine-toothed combapproach to the plaintiffs' complaint leads only to prolixity and delay. The court is not inclined to dismiss a complaint on pleading points. However, where the court is of the opinion that the complaint does not and cannot state a cause of action under state or federal law, then there is no point in passing the matter into discovery. As the saying goes, you should never try to teach a pig to sing: it can't be done, and it annoys the pig. This opinion will therefore only concern itself with whether the various counts can possibly state causes of action against the defendants under any view of the complaint.
In addition to motions brought under FRCP Rule 12(b)(6), several defendants have raised serious limitations issues. To the extent that the complaint obviously sets forth matter beyond the relevant period of limitations, the court feels that the plaintiff should have pleaded acts or circumstances which take the matter past the bar by limitations. Stewart Coach Indus. Inc. v. Moore, 512 F.Supp. 879 (D.Ohio, 1981). Because this was not done, the court prefers to take these questions up on summary judgment. Local Rule 29 requires summary judgment movants to append to their motion statements of facts not disputed. The court feels that a Rule 56 motion filed conformably with local rules will best determine questions of limitations as justly, speedily and efficiently as possible....
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