Scherer v. Balkema

• Decision Date: 09 February 1988
• Docket Number: No. 87-1240,87-1240
• Citation: 840 F.2d 437
• Parties: Anthony J. SCHERER, Jr., Plaintiff-Appellant, v. David J. BALKEMA, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 437

840 F.2d 437

Anthony J. SCHERER, Jr., Plaintiff-Appellant, v. David J. BALKEMA, et al., Defendants-Appellees.

No. 87-1240.

United States Court of Appeals Seventh Circuit.

Argued Oct. 29, 1987.

Decided Feb. 9, 1988.

Carl M. Walsh, Chicago, Ill., for plaintiff-appellant.

William F. Murphy, Asst. U.S. Atty., Anton R. Valukas, U.S. Atty., Chicago, Ill., for defendants-appellees.

Before BAUER, Chief Judge, and CUDAHY and POSNER, Circuit Judges.

BAUER, Chief Judge.

Anthony J. Scherer, Jr. was a federally licensed firearms dealer in the 1960s and early 1970s. The subject of government surveillance for a number of those years, he was convicted in 1974 for violating federal laws and regulations governing firearms dealers. See United States v. Scherer, 523 F.2d 371 (7th Cir.1975), cert. denied, 424 U.S. 911, 96 S.Ct. 1108, 47 L.Ed.2d 315 (1976). During and since that period, Scherer persistently challenged in federal court his treatment by government officials, particularly by agents of the United States Department of the Treasury's Bureau of Alcohol, Tobacco, and Firearms (BATF). ¹ This action is Scherer's latest challenge. Scherer's amended complaint ² alleges that forty-nine federal agents, most from the BATF, conspired from 1963 to 1979 to deprive him of his constitutional rights by engaging in a pattern of attempted entrapment, illegal searches and seizures, perjury, the destruction of evidence, and the withholding of documents. Scherer seeks compensatory and punitive damages under 42 U.S.C. Secs. 1983, 1985(3), and 1986, and the second, fourth, fifth, eighth, ninth, and fourteenth amendments.

The district court, after reviewing various defendants' motions to strike or dismiss Scherer's allegations, along with Scherer's responses, dismissed the entire suit. The court dismissed Scherer's claims under 42 U.S.C. Secs. 1983, 1985(3), and 1986, and 28 U.S.C. Sec. 1343 because he failed to allege sufficiently any state action or racial or class discrimination. The court also dismissed Scherer's Bivens claims. ³ It first held that, because damages in a civil conspiracy action run separately from each overt act (and not from the mere continuance of the conspiracy) and that each overt act therefore triggers its own limitations period, the applicable statute of limitations barred most of Scherer's allegations. ⁴ It next held that Scherer failed to allege sufficiently that the defendants fraudulently concealed information from him, an allegation which, if successful, would have tolled the statute of limitations. Finally, the court held that Scherer's remaining timely allegations failed to allege sufficiently that the defendants conspired to deprive him of his constitutional rights.

Scherer contends on appeal that the district court erred in dismissing most of his Bivens allegations as time-barred, and in holding that his remaining allegations failed to allege sufficiently a conspiracy on the part of defendants. We reject the former argument, accept the latter, yet affirm the dismissal of his timely allegations on other grounds.

I.

A.

Scherer's first argument is that a civil conspiracy action accrues in its entirety upon the occurrence of the last act in furtherance of the conspiracy. He claims that because he alleged some overt acts in furtherance of defendants' conspiracy within the limitations period, he can recover damages for alleged constitutional violations occurring before this period, even though recovery would be time-barred if those violations were sued upon individually.

The Ninth Circuit recently rejected this argument in Gibson v. United States, 781 F.2d 1334 (9th Cir.1986), cert. denied, --- U.S. ----, 107 S.Ct. 928, 93 L.Ed.2d 979 (1987), a civil conspiracy action similar to this one. Applying what it called the "last overt act doctrine" to the plaintiff's "farrago of allegations against numerous federal and local officials," id. at 1340, the court in Gibson held that

"[i]njury and damage in a civil conspiracy action flow from the overt acts, not from 'the mere continuance of a conspiracy.' " Kadar Corp. v. Milbury, 549 F.2d 230, 234 (1st Cir.1977) (quoting Hoffman v. Halden, 268 F.2d 280, 303 (9th Cir.1959). Consequently, the cause of action runs separately from each overt act that is alleged to cause damage to the plaintiff, Lawrence v. Acree, 665 F.2d 1319, 1324 (D.C.Cir.1981) (per curiam), and "[s]eparate conspiracies may not be characterized as a single grand conspiracy for procedural advantage." Fitzgerald v. Seamans, 553 F.2d 220, 230 (D.C.Cir.1977). Accordingly, plaintiffs may recover only for the overt acts ... that they specifically alleged to have occurred within the ... limitations period. Multidistrict Vehicle Air Pollution, 591 F.2d 68, 71 (9th Cir.), cert. denied, 444 U.S. 900, 100 S.Ct. 210, 62 L.Ed.2d 136 (1979).

Id. Other circuits, as the district court below noted, also apply this rule in civil conspiracy actions, see e.g., Lawrence, 665 F.2d at 1324 (D.C.Cir.1981) (per curiam); Singleton v. City of New York, 632 F.2d 185, 192-93 (2d Cir.1980), cert. denied, 450 U.S. 920, 101 S.Ct. 1368, 67 L.Ed.2d 347 (1981); Kadar Corp., 549 F.2d at 234-35 (1st Cir.1977); Mizell v. North Broward Hospital Dist., 427 F.2d 468, 475 (5th Cir.1970), and district courts in still other circuits have done the same, see McKelvey v. Marriot Corp., 488 F.Supp. 345, 346 (D.Md.1980); Safeguard Mutual Insurance Co. v. Miller, 477 F.Supp. 299, 308 (E.D.Pa.1979); see also Creative Environments, Inc. v. Estabrook, 491 F.Supp. 547, 554 (D.Mass.1980), aff'd., 680 F.2d 822 (1st Cir.), cert. denied, 459 U.S. 989, 103 S.Ct. 345, 74 L.Ed.2d 385 (1982).

Unfortunately, some courts have used the phrase "last overt act" in different contexts and Scherer, as he did in the district court, claims these cases support his interpretation of the "last overt act" doctrine. For example, Scherer professes to find an ally in Baker v. F & F Investments, 420 F.2d 1191 (7th Cir.1970), a civil conspiracy action in which we stated that "the limitations periods commence to run from the last overt act of the conspiracy, permitting plaintiffs to recover 'for damages suffered within the damage period as a result of an overt act repetitious of the unlawful pre-[limitation] period acts occurring in the damage period.' " Id. at 1200 (quoting Hazeltine Research, Inc. v. Zenith Radio Corp., 418 F.2d 21, 25 (7th Cir.1969)). In Baker, however, we focused on a series of continuing contractual relationships between the plaintiffs and defendants. Because of the "continuing nature" of the installment purchase contracts involved there, we held that the termination, not the execution, of the contracts was the last overt act for limitations purposes. We still applied the limitations period to each individual contract. See id. Baker, therefore, does not support Scherer's position, nor, as the district court concluded, do any of the other cases he offers. ⁵

A rule allowing plaintiffs in civil conspiracy actions to recover only for overt acts alleged to have occurred within the applicable limitations period makes sense. The function of statutes of limitations is " 'to pull the blanket of peace over acts and events which have themselves already slept for the statutory period, thus barring proof of wrongs imbedded in time-passed events.' " In re Multidistrict Vehicle Air Pollution, 591 F.2d 68, 72 (9th Cir.1979) (quoting Poster Exchange, Inc. v. National Screen Service Corp., 517 F.2d 117, 127 (5th Cir.1975), cert. denied, 423 U.S. 1054, 96 S.Ct. 784, 46 L.Ed.2d 643 (1976)). Thus, characterizing the defendants' separate wrongful acts as having been committed in furtherance of a "continuing" conspiracy should not postpone accrual of damage claims based on individual wrongful acts. ⁶ As the Second Circuit has noted,

the crucial time for accrual purposes is when the plaintiff becomes aware that he is suffering from a wrong for which damages may be recovered in a civil action. To permit him to wait and toll the running of the statute simply by asserting that a series of separate wrongs were committed pursuant to a conspiracy would be to enable him to defeat the purpose of the time bar, which is to preclude the resuscitation of stale claims.

Singleton, 632 F.2d at 192. ⁷ We agree.

B.

Scherer next argues that the statute of limitations was tolled with respect to his otherwise time-barred allegations because the defendants fraudulently concealed information from him and thereby prevented him from realizing he was injured. He claims that until he obtained documents under the Freedom of Information Act (FOIA), he did not know that certain letters mailed to him were from BATF agents, that undercover BATF agents offered to buy guns from him in an illegal manner, and that documents were withheld from him.

The district court found that Scherer's amended complaint failed to allege adequately the necessary elements of a fraudulent concealment claim, ⁸ and we agree with its analysis and conclusion that

[Scherer's] assertions ... are not specific enough to merit relief under the fraudulent concealment doctrine. Plaintiff fails to allege any affirmative misconduct by defendants. Nor does his general statement that he still seeks information, without particular facts showing, for instance, that he has exhausted his remedies under the Freedom of Information Act, demonstrate concealment. Furthermore, plaintiff admits that he knew "certain of the acts" of defendants before the limitations period had expired, Plf. Responses at 8; presumably, he could have litigated them then. The four later-discovered incidents, since they merely amplify the dozens of other allegations in the amended complaint, would not have changed the litigation. Therefore, concluding that plaintiff could have sued on each claim while it was timely, we shall not consider any acts that occurred beyond the limitations period.

We find no error in the district court's dismissal of Scherer's...