Waldner v. Boade
| Decision Date | 10 July 2013 |
| Docket Number | Civ. 10-4056-LLP |
| Parties | ROGER D. WALDNER, Plaintiff, v. ALLISON BOADE, M.D.; KAREN SNOW; WARNER TRUCK CENTER OF UTAH; ACTION CARRIER, INC.; MICHAEL L. WALSH; WENDY L. WALSH; GALLEY W. SMITH; BRADLEY HARTKE; DOUGLAS HARTKE; JACK MAKLER; RICHARD D'MARTINI; JANE DOES 1-14; JOHN DOES 1-14; ROBERT THOMAS MOORE; and A. THOMAS POKELA, Defendants. |
| Court | U.S. District Court — District of South Dakota |
GALLEY W. SMITH, BRADLEY
HARTKE, AND DOUGLAS HARTKE'S
MOTION FOR JUDGMENT ON THE
Plaintiff Roger D. Waldner is an inmate at the Federal Prison Camp in Duluth, Minnesota. Docket 1 at 1. On May 20, 2010, Waldner filed a pro se lawsuit against more than sixty named defendants, alleging that defendants engaged in a broad conspiracy to defraud him in violation of the Racketeer Influenced and Corrupt Organizations Act ("RICO"). Id. On September 23, 2011, after receiving and considering various dispositive motions, the Court dismissed Waldner's claims against the majority of the named defendants. Docket 281. The Court dismissed two more defendants on May 25, 2012 (Docket 344), and another defendant on March 15, 2013 (Docket 362). Waldner's claims against Galley W. Smith, Bradley Hartke, andDouglas Hartke, however, remain. Accordingly, Smith, B. Hartke, and D. Hartke move for judgment on the pleadings (Docket 357) and assert that Waldner not only failed to state a claim upon which relief may be granted, but failed to do so in a timely manner (Docket 358). Waldner opposes the motion. Docket 360. For the reasons set forth herein, the Court grants defendants' motion for judgment on the pleadings.
In the light most favorable to Waldner, the facts are as follows:
In 2002, Waldner initiated bankruptcy proceedings on behalf of H&W Motor Express Company, his solely owned corporation. See In re H & W Motor Express Co., 343 B.R. 208 (Bankr. N.D. Iowa 2006). After the close of the bankruptcy proceedings, numerous creditors filed state-court lawsuits against Waldner in Iowa and South Dakota alleging that Waldner violated various contracts. In 2007, Waldner pleaded guilty to having made false statements during the federal bankruptcy proceedings. See United States v. Waldner, 564 F. Supp. 2d 911 (N.D. Iowa 2008). Consequently, Waldner was sentenced to ten years in prison.
The instant case arose out of a dispute between Waldner, William Rush, and their respective business entities. Rush is the majority shareholder and chief executive officer of North American Truck & Trailer, Inc. ("NATT"), and at the outset of this case, Waldner accused Rush of conspiring with a multitude of lawyers, accountants, financial institutions, corporations, and federal prisoners to defraud Waldner. Docket 9. Galley Smith, Bradly Hartke, and Douglas Hartke are three such individuals accused of conspiring with Rush to defraud Waldner. Each of these defendants worked with or for Waldner—Smith was the President ofH&W Smith and B. Hartke served on the board of directors of H&W and D. Hartke was a dispatcher for Solace Transfer, a company owned by Waldner. Docket 9 at ¶¶ 50-52.
Waldner alleges that Smith, B. Hartke, and D. Hartke "were former business associates with William R. Rush and the Rush Criminal Enterprise Companies prior to their meeting and become [sic] involved with Waldner." Docket 9 at ¶ 225. According to Waldner, defendants "agreed to join to 'bleed out' Waldner's business assets by falsifying checks and wire transfers1 in interstate commerce drawn on Waldner's and H&W accounts as a apart [sic] of the Rush Criminal Enterprise Companies conspiracy to destroy H&W and Waldner." Id. at ¶ 227. A portion of the monies from such transactions were paid to the Rush Criminal Enterprise Companies, and some of the monies "were paid to unknown, fake, dummy persons or corporations, or accounts, set up by [Smith, B. Hartke, and D. Hartke]." Id. at ¶ 228. Therefore, because Smith, B. Hartke, and D. Hartke "were aware of the existence of the Rush Criminal Enterprise Companies and its plan to destroy H&W and Waldner's business reputation," Waldner asserts that defendants conspired to and did engage in a pattern of racketeering activities in violation of 18 U.S.C. §§ 1962(c) and (d). Id. at ¶¶ 1, 226.
Since defendants have not relied on materials outside the pleadings, e.g. depositions, answers to interrogatories, admissions on file, or affidavits, the Court will treat the pending motion as a motion for judgment on the pleadings. "The applicable standard of review on a motion for judgment on the pleadings pursuant to Fed. R. Civ. P. 12(c) is the same as that on amotion to dismiss under Fed. R. Civ. P. 12(b)(6)." Cain v. Ark. Dep 7 of Corr., No. 5:05CV00053HLJ, 2006 WL 2547401, at *1 (E.D. Ark. Sept. 1, 2006) (citations omitted); see also Westcott v. City of Omaha, 901 F.2d 1486, 1488 (8th Cir. 1990) (). "Judgment on the pleadings is appropriate when there are no material facts to resolve and the moving party is entitled to judgment as a matter of law." Mills v. City of Grand Forks, 614 F.3d 495, 497-98 (8th Cir. 2010) (citation omitted). "The facts pleaded by the non-moving party must be accepted as true and all reasonable inferences from the pleadings should be taken in favor of the non-moving party." Id. (citation omitted). 'The court may consider the pleadings themselves, materials embraced by the pleadings, exhibits attached to the pleadings, and matters of public record." Id. (citation omitted); see also Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1371, at 276 (2004) ().
Pro se complaints, " 'however inartfully pleaded,' [are] held to 'less stringent standards than formal pleadings drafted by lawyers.' " Estelle v. Gamble, 429 U.S. 97,106 (1976) (quoting Haines v. Kerner, 404 U.S. 519, 520 (1972)). Nonetheless, a pro se complaint must comply with the minimal requirements set forth in the Federal Rules of Civil Procedure, which specifically require pleadings to contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). Although a pro se complaint need not contain detailed factual allegations, it must contain "more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v.Twombly, 550 U.S. 544, 555 (2007). A pro se complaint must "allege facts sufficient to support the claims advanced." Stone v. Harry, 364 F.3d 912, 914 (8th Cir. 2004). The Court is not required to "supply additional facts, nor will [it] construct a legal theory that assumes facts that have not been pleaded." Id. (citing Dunn v. White, 880 F.2d 1188, 1197 (10th Cir. 1989)). If the complaint does not contain these bare essentials, dismissal is appropriate. Beavers v. Lockhart, 755 F.2d 657, 663 (8th Cir. 1985).
"To recover in a civil suit for a violation of RICO, a plaintiff must prove: (1) that the defendant violated 18 U.S.C. § 1962; (2) that the plaintiff suffered injury to business or property; and (3) that the plaintiff's injury was proximately caused by the defendant's RICO violation." Fogie v. THORN Americas, Inc., 190 F.3d 889, 894 (8th Cir. 1999) (citations omitted). In the instant case, Waldner has alleged that Smith, B. Hartke, and D. Hartke violated subsections (c) and (d) of 18 U.S.C. § 1962. Docket 1 at ¶¶ 1, 230.
Under subsection (c), it is "unlawful for any person employed by or associated with any enterprise engaged in, or the activities of which affect, interstate or foreign commerce, to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity or collection of unlawful debt." To state a claim under § 1962(c), "a plaintiff must establish (1) the existence of an enterprise; (2) defendant's association with the enterprise; (3) defendant's participation in predicate acts of racketeering; and (4) defendant's actions constitute a pattern of racketeering activity." United Healthcare Corp. v. Am. Trade Ins. Co., 88 F.3d 563, 570 (8th Cir. 1996). Moreover, "the plaintiff must demonstrate that 'he hasbeen injured in his business or property by the conduct constituting the violation.' " Id. (quoting Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479,496 (1985)).
Subsection (d) incorporates the conduct prohibited in subsection (c) by making it "unlawful for any person to conspire to violate any of the provisions of subsection (a), (b), or (c) of [§ 1962]." To establish that a defendant engaged in a conspiracy to violate RICO, a plaintiff must present "additional evidence2 that the defendant entered into an agreement to breach the statute." Handeen v. Lemaire, 112 F.3d 1339, 1354 (8th Cir. 1997) (citations omitted).
Defendants Smith, B. Hartke, and D. Hartke assert that they are entitled to judgment in their favor because Waldner has (1) failed to allege an "enterprise" within the meaning of § 1962(c); (2) failed to allege a continuous pattern of racketeering activity as required by § 1962(c); (3) failed to allege facts supporting a tacit understanding of the underlying § 1962 violation; and (4) failed to file his RICO claim within the applicable statute of limitations. Docket 358. The Court will address each of defendants' arguments in turn.
To state a claim pursuant to § 1962(c), a plaintiff must first allege the existence of an enterprise. An enterprise must possess three characteristics: "[a] common or shared purpose, some continuity of structure3 and personnel, and an ascertainable structure distinct from thatinherent in a...
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