157 F. Supp. 3d 788
N.D. Ill.2016Background
- Plaintiffs allege Defendants (Pushpin, Lease Finance, and Cohen) ran a scheme using forged lease agreements to extract monthly payments, send deceptive collection demands, and obtain default judgments in court proceedings.
- Plaintiffs previously pleaded breach of contract and ICFA claims; they withdrew the breach claim in the Second Amended Complaint and proceed on an Illinois Consumer Fraud Act (ICFA) claim.
- Defendants moved to dismiss the Second Amended Complaint on statute-of-limitations grounds, arguing many alleged deceptive acts occurred outside ICFA’s three-year limitations period.
- Plaintiffs invoked the discovery rule and the continuing-violation doctrine, arguing their claims did not accrue until they discovered the forgery and that the alleged scheme produced ongoing injuries into the limitations period.
- The court considered the motion under Rule 12(b)(6), taking all well-pleaded facts and reasonable inferences in Plaintiffs’ favor.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| When did ICFA claim accrue (statute of limitations)? | Accrual delayed by discovery rule—claim accrued when plaintiffs learned of forged leases and related wrongful conduct. | Accrual occurred when plaintiffs first suffered monetary injury from the credit‑card machines (years earlier). | Court: Discovery rule plausibly alleged; claim not time‑barred at pleading stage. |
| Applicability of continuing‑violation doctrine | Plaintiffs contend the scheme was ongoing (forgeries, misleading letters, suits, judgments) so later acts toll earlier ones. | Defendants say earlier discrete injuries are independently actionable and cannot be linked to toll the period. | Court: Doctrine applies; alleged acts form a cumulative ongoing scheme, so claim survives. |
| Whether statute‑of‑limitations defense is proper on Rule 12(b)(6) where not previously raised | Plaintiffs emphasize factual disputes about notice and discovery that preclude dismissal. | Defendants raised the limitations defense now despite not raising it earlier. | Court: Although defense could have been waived, court reached merits and found defense fails on pleadings. |
| Motion to strike allegations about arbitration clause | Plaintiffs say arbitration clause allegations are relevant to show deception (suits filed despite arbitration provisions). | Defendants request striking as immaterial because breach claim withdrawn. | Court: Denied without prejudice; premature to strike arbitration allegations now. |
Key Cases Cited
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for pleadings)
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standards and drawing inferences)
- Knox College v. Celotex Corp., 88 Ill.2d 407 (Ill. 1981) (discovery rule—accrual when plaintiff knows injury and wrongful cause)
- Kovacs v. United States, 614 F.3d 666 (7th Cir. 2010) (continuing‑violation doctrine delays accrual until last injury)
- Rodrigue v. Olin Employees Credit Union, 406 F.3d 434 (7th Cir. 2005) (continuing violation applies to repeated/continued injuries)
- Filipovic v. K & R Express Sys., Inc., 176 F.3d 390 (7th Cir. 1999) (continuing‑violation links time‑barred acts to timely acts)
- Superior Bank FSB v. Golding, 152 Ill.2d 480 (Ill. 1992) (forgery context supports postponing accrual to date of discovery)