White v. Barrington Golf Club

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF OHIO

EASTERN DIVISION

KENNETH WHITE, ) CASE NO. 5:22-cv-130

)

)

PLAINTIFF, ) JUDGE SARA LIOI

)

vs. )

) MEMORANDUM OPINION

)

BARRINGTON GOLF CLUB, et al., )

)

)

DEFENDANT. )

On January 25, 2022, pro se plaintiff Kenneth White (“plaintiff” or “White”), a prisoner at

USP Thomson, filed this action in federal court seeking to recover damages associated with the

loss of a golf club membership. (Doc. No. 1 (Complaint).) On April 13, 2022, White filed an

amended complaint against defendants Barrington Golf Club (“Barrington”), BGC LLC (“BGC”),

Monte Ahuja (“Ahuja”), and Diane Ford (“Ford”) (collectively “defendants”), and this pleading is

now the operative complaint.1 (Doc. No. 6 (Amended Complaint).)

Now before the Court is defendants’ motion to dismiss the amended complaint. (Doc. No.

18 (Motion).) Plaintiff opposes the motion (Doc. No. 23 (Opposition)), and defendants have filed

a reply (Doc. No. 24 (Reply)). Because this Court lacks jurisdiction, defendants’ motion is

GRANTED, and this action is DISMISSED.

1 An amended complaint supersedes the original complaint and becomes the only “legally operative complaint[.]”

Parry v. Mohawk Motors of Mich., Inc., 236 F.3d 299, 306 (6th Cir. 2000); see Othen v. Ann Arbor Sch. Bd., 699 F.2d

309, 311 (6th Cir. 1983).

I. BACKGROUND

In 2006, White acquired an equity membership in Barrington from another member for the

purchase price of $30,000.00, which White alleges in conclusory fashion “was valued at

$50,000.00.” (Doc. No. 6 ¶ 1.) In 2011, he contacted Barrington to request that his membership be

placed into escrow. (Id. ¶ 2.) When White contacted Barrington again in 2012 to direct Barrington

to sell his membership, he was informed “that he could not sell his membership at that time due to

[Barrington] having financial troubles.” (Id.) He alleges that he has since attempted to determine

the status of his equity membership but has been “stonewall[ed]” by defendants by means of

“continuous ploys and stories of foreclosure filings and other legal actions[.]” (Id. ¶ 3.) He claims

that defendants acted “all without once giving any notice to” him that Barrington was “restructured

to BGC[.]” (Id. ¶¶ 3, 10.)

Though the amended complaint is not entirely clear, the pleading purports to raise the

following claims: breach of fiduciary duty (id. ¶ 4), breach of contract (id. ¶ 5), negligent

misrepresentation (id. ¶ 6), fraud (id. ¶ 7), misappropriation of funds (id. ¶ 8), conversion (id. ¶ 9),

dissolution of partnership (id. ¶ 11), and punitive damages (id. ¶ 12). (See id. ¶ 14 (listing claims).)

White seeks $72,000 in compensatory damages—representing the $50,000.00 alleged value of his

original investment, plus 9% interest—and $600,000.00 in punitive damages. He also requests

costs and attorney’s fees. (Id. at 11.2)

Defendants now move for dismissal, pursuant to Rule 12(b) of the Federal Rules of Civil

Procedure, maintaining that the amended complaint fails to state claims upon which relief may be

2 All page number references herein are to the consecutive page numbers applied to each individual document by the

Court’s electronic filing system.

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granted and that the claims are time-barred. Additionally, defendants posit that federal jurisdiction

is lacking, that White failed to perfect service upon them, and that White failed to show proof of

service as directed by the Court. Because it is a threshold issue, and because it is dispositive of

defendants’ motion, the Court begins by considering whether it has jurisdiction to hear this matter.

See Caudill v. N. Am. Media Corp., 200 F.3d 914, 916 (6th Cir. 2000) (holding that the presence

or absence of jurisdiction is the “first and fundamental question presented by every case brought

to the federal courts”).

II. FEDERAL JURISDICTION

A. Standard of Review

Defendants challenge the Court’s jurisdiction pursuant to Fed. R. Civ. P. 12(b)(1). A

motion under Rule 12(b)(1) may be brought as a facial attack—that is, a challenge to the

sufficiency of the complaint—or a factual attack—taking in evidence beyond the pleadings.

Cartwright v. Garner, 751 F.3d 752, 759 (6th Cir. 2014). Courts entertaining a factual attack have

“wide discretion” to consider affidavits and documents “to arrive at the factual predicate that

subject-matter [jurisdiction] does or does not exist.” Gentek Bldg. Prods., Inc. v. Sherwin-Williams

Co., 491 F.3d 320, 330 (6th Cir. 2007). The Court may also take judicial notice of its own records,

in addition to other matters. See Fed. R. Evid. 201(b)(2); United States v. Doss, 563 F.2d 265, 269

n.2 (6th Cir. 1977). Regardless of which sort of attack is presented, the plaintiff has the burden to

prove the jurisdictional facts, Cartwright, 751 F.3d at 760, but all parties should have the

opportunity to present evidence on the issue. The Court “has the power to weigh [that] evidence

and determine the effect of that evidence on the court’s authority to hear the case.” Id. at 759–60.

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B. Law and Discussion

“Federal courts are courts of limited jurisdiction.” Kokkonen v. Guardian Life Ins. Co. of

Am., 511 U.S. 375, 377, 114 S. Ct. 1673, 128 L. Ed. 2d 391 (1994). In other words, federal courts

“have only the power that is authorized by Article III of the Constitution and the statutes enacted

by Congress pursuant thereto.” Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541, 106 S.

Ct. 1326, 89 L. Ed. 2d 501 (1986). “There are two types of subject matter jurisdiction bestowed

upon the federal district courts: federal question jurisdiction and diversity jurisdiction.” Lee v.

Money Gram Corp. Off., No. 15-cv-13474, 2016 WL 3524332, at *1 (E.D. Mich. May 23, 2016),

report and recommendation adopted, 2016 WL 3476704 (E.D. Mich. June 27, 2016). Federal

question jurisdiction exists when the civil action “aris[es] under the Constitution, laws, or treaties

of the United States.” 28 U.S.C. § 1331. Diversity jurisdiction exists in civil actions between

citizens of different states where the matter in controversy exceeds “the sum or value of $75,000,

exclusive of interest and costs[.]” 28 U.S.C. § 1332(a)(1).

1. There is No Federal Question Jurisdiction

In order to invoke the Court’s federal question jurisdiction pursuant to 28 U.S.C. § 1331,

a plaintiff must allege facts showing the cause of action involves an issue of federal law. See Metro.

Life Ins. Co. v. Taylor, 481 U.S. 58, 63, 107 S. Ct. 1542, 95 L. Ed. 2d 55 (1987). While the amended

complaint identifies federal question jurisdiction as the basis for this Court’s jurisdiction (see Doc.

No. 6, at 4), White cites no federal statutes, laws, or treaties giving rise to federal question

jurisdiction. The amended complaint is also devoid of any factual allegations that would otherwise

give rise to any federal statutory or constitutional provisions sufficient to invoke the Court’s

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jurisdiction under § 1331. Instead, the amended complaint merely lists White’s state law claims.3

(Id.) Further, White abandoned any argument that the amended complaint raises a federal question

by failing to respond to defendants’ argument that federal question jurisdiction is lacking. (See

Doc. No. 18, at 18–20.) He has, therefore, waived any argument that federal question jurisdiction

exists and, in any event, the Court finds no evidence that the amended complaint satisfies the

requirement for federal jurisdiction under § 1331.4 See Humphrey v. U.S. Att’y Gen. Off., 279 F.

App’x 328, 331 (6th Cir. 2008) (stating that “where, as here, plaintiff has not raised arguments in

the district court by virtue of his failure to oppose defendants’ motions to dismiss, the arguments

have been waived” (citations omitted)).

2. There is No Diversity Jurisdiction

This leaves diversity jurisdiction. Under 28 U.S.C. § 1332, federal district courts “have

original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value

of $75,000, exclusive of interest and costs, and is between . . . citizens of different States.” 28

U.S.C. § 1332(a). For diversity to lie, diversity must be complete, meaning that the citizenship of

the plaintiff must be “diverse from the citizenship of each defendant.” Caterpillar Inc. v. Lewis,

3 Plaintiff makes no argument that his claims arise out of federal common law, and case law would not support such

an argument. See Musson Theatrical, Inc. v. Fed. Exp. Corp., 89 F.3d 1244, 1249–52 (6th Cir. 1996) (noting that there

are no federal common law claims for fraud and negligent misrepresentation). Moreover, while pro se pleadings are

entitled to a liberal construction, see Haines v. Kerner, 404 U.S. 519, 520, 92 S. Ct. 594, 30 L. Ed. 2d 652 (1972), the

district court is not required to “conjure allegations” on behalf of a pro se litigant or guess at the nature of his claims.

Martin v. Overton, 391 F.3d 710, 714 (6th Cir. 2004) (quotation marks and citation omitted); Wells v. Brown, 891

F.2d 591, 594 (6th Cir. 1989) (citing cases).

4 In response to a show cause order, filed more than five months before defendants’ motion to dismiss, White suggested

that he has pled a federal claim under the Investment Company and Advisers Act of 1940 (the “Act”), 18 U.S.C. §

80a-1(b). (See Doc. No. 11 (“Motion to Oppose” Dismissal for Want of Prosecution/Failure to Prosecute) ¶ 9.) The

amended complaint, however, does not allege any facts that would support a claim under the Act or, if believed, would

demonstrate that any of the defendants fall within the definition of “investment companies” or “investment advisers”

under the Act. See 15 U.S.C. §§ 80a-3(a)(1) and 80a-2(a)(20).

5

519 U.S. 61, 68, 117 S. Ct. 467, 136 L. Ed. 2d 437 (1996); see Owen Equip. & Erection Co. v.

Kroger, 437 U.S. 365, 373, 98 S. Ct. 2396, 57 L. Ed. 2d 274 (1978) (noting that “diversity

jurisdiction does not exist unless each defendant is a citizen of a different State from each plaintiff”

(emphasis in original)).

a. The Parties are Not Diverse

The amended complaint alleges that both White and Ford are citizens of Ohio. (Doc. No.

6, at 4.) The amended complaint makes no representations regarding the citizenship of any other

party. This should end the inquiry as—by his own admission—White shares the same citizenship

of at least one of the defendants. Still, because the amended complaint lists as White’s residence

the address of the federal penitentiary in Bradford, Pennsylvania where, until recently, White was

housed (see id. at 2), and White argues in his opposition that he “has not actually lived in Ohio for

many years[,]” the Court finds that it must comment briefly on diversity law as it relates to

prisoners.5 (See Doc. No. 23, at 8.)

A person’s citizenship for purposes of diversity jurisdiction is his “domicile.” See Certain

Interested Underwriters at Lloyd’s, London, Eng. v. Layne, 26 F.3d 39, 41 (6th Cir. 1994); Stifel

v. Hopkins, 477 F.2d 1116, 1120 (6th Cir. 1973). “Domicile” is determined by physical presence

in the state and either an intention to reside there indefinitely or the absence of an intention to

reside elsewhere. Stifel, 477 F.2d at 1120. “[T]here is a rebuttable presumption that a prisoner

retains his former domicile [during] incarceration.” Johnson v. Corr. Corp of Am., No. 00-4439,

2001 WL 1298982, at *2 (6th Cir. Aug. 8, 2001) (citing Stifel, 477 F.2d at 1124); see Smith v.

5 According to the Bureau of Prison’s website, White is currently serving a federal sentence at USP Thomson, in

Thomson, Illinois. White’s anticipated release date is February 1, 2028. (See https://www.bop.gov/inmateloc/, last

visited June 21, 2023.)

6

Cummings, 445 F.3d 1254, 1260 (10th Cir. 2006) (noting that it is generally presumed that a

prisoner remains “a citizen of the state of which he was a citizen before his incarceration, even if

he is subsequently incarcerated in another state” (citing Sullivan v. Freeman, 994 F.2d 334, 337

(7th Cir. 1991)); see also Stifel, 477 F.2d at 1121) (noting that “a person cannot acquire a domicile

of choice in a place if he is there by virtue of physical or legal compulsion”).

Although at the time this motion was being briefed, White was incarcerated in

Pennsylvania, in May 2023, White was relocated and is now serving his sentence at USP Thomson,

a BOP facility in Thomson, Illinois. (Doc. No. 28.). White makes no allegations that Pennsylvania

(or, now, Illinois) was his pre-incarceration domicile, that he considers Pennsylvania (or Illinois)

to be his current domicile, or that he intends to remain in Pennsylvania (or Illinois) after his

incarceration. Rather, as previously indicated, White concedes that he previously lived in Ohio,

and even lists it as the place of his citizenship.6 (See Doc. No. 6, at 4; Doc. No. 23, at 8.) Based

upon this record, the Court cannot find that diversity jurisdiction is satisfied. See, e.g., Cornell v.

Fox News Network, No. 1:19-cv-698, 2020 WL 4530598, at *1 (S.D. Ohio Aug. 6, 2020) (noting

“[p]laintiff makes no allegations that he considers New Jersey to be his current domicile, or that

he intends to remain in New Jersey after he is released from prison”); Caesar v. Rosstead, 593 F.

Supp. 2d 91, 94 (D.D.C. 2009) (plaintiff-prisoner did not establish that his state of incarceration

6 In response to the Court’s show cause order, White alleged that he a “resident and citizen of the State of

Pennsylvania.” (Doc. No. 11, at 4.) White offers no facts (other than the place in which he was then incarcerated) in

support of this conclusory statement. See, e.g., Hawkins v. Bruner, No. 1:12-cv-1359, 2012 WL 4919811, at *1 (N.D.

Ohio Oct. 16, 2012) (rejecting prisoner’s argument that his citizenship was in the state in which he was housed where

he made no allegations in support). White’s internally inconsistent filings fail to satisfy his burden of demonstrating

this Court’s jurisdiction. See generally Kokkonen, 511 U.S. at 377 (holding that the party seeking to invoke a federal

court’s jurisdiction bears the burden of demonstrating the existence of federal jurisdiction (citation omitted)).

Moreover, that White has recently been relocated by the BOP to a facility in a different state (Illinois) further illustrates

White’s shortcoming in failing to satisfy his burden.

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was his domicile).

White argues, however, that “the Court still has jurisdiction over this matter because the

defendant BGC[] is an entity out of Delaware.” (Doc. No. 23, at 8 (citing Doc. No. 23-2

(Promissory Note).) This argument fails as a matter of law. Initially, the Court notes that, for

purposes of diversity jurisdiction, “a limited liability company is not treated as a corporation and

has the citizenship of its members.” Homfeld II, L.L.C. v. Comair Holdings, Inc., 53 F. App’x 731,

732 (6th Cir. 2002). White offers no information regarding the citizenship of the members of BGC.

Accordingly, White has not carried his burden with respect to this defendant. Even if he had, and

each of the members of the limited liability company was diverse from White, the argument would

still fail because White must prove that he is diverse from each and every defendant. See Owen

Equip. & Erection Co., 437 U.S. at 373. As previously observed, White concedes that defendant

Ford is a citizen of Ohio. (See Doc. No. 6, at 4.)

Because White has not alleged facts that would establish that all defendants are citizens of

a state other than Ohio, White has not established the existence of diversity jurisdiction.

b. The Jurisdictional Amount is Not Satisfied

The Court also finds that White has failed to demonstrate that he has satisfied the

jurisdictional amount of $75,000.00. While he states that he paid $30,000.00 for the golf club

membership, he alleges in conclusory fashion that it “was valued at $50,000.00.” (Doc. No. 6 ¶ 1.)

White fails to allege any facts that would support this conclusion, and his “subjective belief that

[the golf club membership] was worth [considerably more than he paid], without more, is

insufficient to establish the statutory jurisdictional amount.” See Randall v. Pitzer, 23 F. App’x

532, 534 (6th Cir. 2001) (citation omitted). Of course, to the extent his $50,000.00 valuation was

8

sufficient (and it was further assumed that the Court could factor in White’s inflated estimation of

interest), the purported estimated current value of $72,000.00 (see Doc. No. 1, at 11) would not

satisfy the $75,000.00 threshold amount.

White’s unsupported request for $600,000.00 in punitive damages (id.) does not bring him

any closer to satisfying the jurisdictional amount. While a good faith request for punitive damages

can support the jurisdictional amount necessary to establish diversity jurisdiction, the allegations

in the amended complaint fall short of establishing his right to these damages under Ohio law.

Punitive damages are not available for breach of contract in Ohio. Ketchman v. Miller, 136 N.E.

145, 146 (Ohio 1922). This is true “irrespective of the motive on the part of the defendant and no

matter how willful the breach[.]” Kruse v. Vollmar, 614 N.E.2d 1136, 1141 (Ohio Ct. App. 1992)

(citation omitted).

“An exception to this general rule is when the actions which constitute the breach of

contract also amount to an independent, willful tort.” Spalding v. Coulson, 661 N.E.2d 197, 207

(Ohio Ct. App. 1995). Even where a defendant’s actions amount to a willful tort, however, a

plaintiff in Ohio must demonstrate the existence of actual malice in order to recover punitive

damages. Berge v. Columbus Cmty. Cable Access, 736 N.E.2d 517, 542 (Ohio Ct. App. 1999)

(citations omitted). “Actual malice consists of either a state of mind characterized by hatred, ill

will or a spirit of revenge or a conscious disregard for the rights and safety of others which results

in a strong probability of substantial harm to the affected persons.” Spalding, 661 N.E.2d at 207.

Even in cases of fraud, a plaintiff must demonstrate “that the fraud is aggravated by the existence

of malice or ill will, or must demonstrate that the wrongdoing is particularly gross or egregious”

in order to recover punitive damages. Elderlite Exp., Inc. v. Capitol City Trailers, Inc., No. 2:06-

9

cv-737, 2009 WL 891762, at *4 (S.D. Ohio Mar. 31, 2009) (quotations marks and citation

omitted).

Applying even the most liberal construction to White’s allegations, the Court finds the

amended complaint fails to set forth any facts showing actual malice, ill will, or gross or egregious

fraud to justify an award of punitive damages. It appears, therefore, to a legal certainty that White

cannot in good faith claim the jurisdictional amount because there is no basis in Ohio law for the

recovery of punitive damages in this case. For this additional reason, the Court finds that it lacks

subject matter jurisdiction on the basis of diversity of citizenship. Accordingly, the Court cannot

hear White’s state law claims, and the amended complaint is subject to dismissal.7

III. STATUTES OF LIMITATIONS

Even if diversity jurisdiction were found to exist, White’s claims are time-barred. “Statutes

of limitations foster important public policies: ensuring fairness to the defendant, encouraging

prompt prosecution of causes of action, suppressing stale and fraudulent claims, and avoiding the

inconvenience engendered by delay and by the difficulty of proving older cases.” Cundall v. U.S.

Bank, 909 N.E.2d 1244, 1249 (Ohio 2009). In determining the appropriate statute of limitations

7 Dismissal would be appropriate for the additional reason that White failed to timely perfect service upon defendants.

On November 10, 2022, the Court entered an order directing White to serve defendants in accordance with Fed. R.

Civ. P. 4(c)(1) & m and imposed a deadline of January 5, 2023 to perfect service and show proof. (Doc. No. 13

(Order).) The show cause order cautioned White that failure to timely comply could result in dismissal of any

defendant who has not been properly served. (Id. at 2.) On December 27, 2022, White filed a notice purporting to

show that he served defendants. (Doc. No. 16.) Attached to the notice are certified mail return receipts addressed to

each defendant. (Doc. No. 16-1.) Each return receipt identifies White as the sender. (Id. at 2–9.) This does not comply

with the rules governing service. White’s purported attempt to effectuate certified mail service himself is contrary to

the Federal Rules of Civil Procedure and the Court’s local rules. Only a non-party may serve a summons and

complaint. See Fed. R. Civ. P. 4(c)(2). Additionally, Local Rule 4.2(a) allows service by certified mail when the Clerk

causes it to be mailed and then, only after the Clerk is able to inspect the service from an unsealed envelope beforehand

to “verify the contents prior to mailing.” LR 4.2(a). Further, Local Rule 4.2(b) requires the Clerk to “enter the fact of

mailing on the appearance docket and make a similar entry when the return receipt is returned.” LR 4.2(b). The docket

does not reflect that White complied with these local rules.

10

for a given case, the Ohio Supreme Court has directed courts to look to the “essential character”

of the plaintiff’s claims. Id. (quotation marks and citation omitted).

“Ohio law recognizes that a cause of action accrues ‘when the right to prosecute it begins.’”

Kanally v. Ameritech Ohio Co., No. 87472, 2008 WL 4068185, at *3 (Ohio Ct. App. Sept. 4, 2008)

(quoting Singh v. ABA Publ’g/Am. Bar Assoc., No. 02AP-1125, 2003 WL 21027897, at *4 (Ohio

Ct. App May 8, 2003)); see Lutz v. Cheasapeake Appalachia, L.L.C., 717 F.3d 459, 473 (6th Cir.

2013) (holding that, generally, a cause of action accrues when the wrongful act is committed (citing

Ohio law)). Where appropriate, however, Ohio courts invoke the “discovery rule,” which provides

that “a cause of action accrues for purposes of the governing statute of limitations at the time when

the plaintiff discovers or, in the exercise of reasonable care, should have discovered the complained

of injury.” Investors REIT One v. Jacobs, 546 N.E.2d 206, 209 (Ohio 1989) (citations omitted).

Here, White’s claims for fraud and breach of fiduciary duty are governed by the four-year

statute of limitations set forth in Ohio Rev. Code § 2305.09. Cundall, 909 N.E.2d at 1249 (holding

that “[c]laims for fraud and breach of fiduciary duty based on fraud are governed by the four-year

statute of limitations set forth in [Ohio Rev. Code] § 2305.09, unless the claim is not discovered

despite reasonable diligence” (citing Investors REIT One, 546 N.E.2d at 209)). White’s conversion

and misappropriation claims are also barred by the four-year statute of limitations set forth in §

2305.09. See Hambleton v. R.G. Barry Corp., 465 N.E.2d 1298, 1301 (Ohio 1984) (finding

misappropriation and conversion claims untimely because plaintiff “possessed knowledge

sufficient to lead a reasonably prudent person to make inquiry and had such inquiry been made

with reasonable care and diligence, it would have led to the discovery of the wrongdoing” within

the four-year statute of limitations specified in Ohio Rev. Code § 2305.09(B)). White’s breach of

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contract claim is governed by an eight-year statute of limitations set forth in Ohio Rev. Code §

2305.06 for written contracts.8

Defendants argue that, by his own admissions, White was aware of Barrington’s “financial

troubles” by no later than 2012. (Doc. No. 6 ¶¶ 2–3.) Further, the “stories” he alleges were

conveyed by defendants of “foreclosure filings and other legal actions” would have further

compelled the reasonable person in “White’s shoes” to investigate the matter in order to protect

his rights. (Doc. No. 18, at 8–9.) Defendants posit that “[t]he most obvious course of action of a

person in White’s position under similar circumstances would have been to conduct an in person

or online search of the foreclosure docket at the Portage County Court of Common Pleas or engage

counsel for that purpose.” (Id. at 9.) Such a search would have permitted White to confirm that

BGC did in fact initiate a foreclosure action against Barrington on September 26, 2011, ultimately

resulting in BGC acquiring Barrington’s assets at public auction, and further resulting in

Barrington formally dissolving on June 12, 2012. (Id. at 9–10.)9 According to defendants, any

8 In 2007, Ohio’s statute of limitations for breach of written contract claims was 15 years, but in September 2012, it

was shortened to 8 years. Ohio Rev. Code § 2305.06 (2007, 2012). It remained eight years until 2021, when it was

further shortened to a six-year period. § 2305.06 (2021). However, for claims accruing prior to September 28, 2012

(when the statute was shortened), the limitation period is 15 years from the date of accrual or 8 years from September

28, 2012, whichever is less. Lee v. Equity Trust Co., No. 1:21-cv-1052, 2021 WL 8342838, at *6 (N.D. Ohio Dec. 30,

2021) (report and recommendation (citing Ohio law)). Because it is unclear from the amended complaint when in

2012 White contacted defendants, and giving White every benefit of the doubt, the Court applies the longer, eight-

year limitations period applicable to claims accruing prior to September 28, 2012. Moreover, to the extent that White’s

claim of dissolution of partnership is a cause of action under Ohio law, it would be governed by the terms of the equity

agreement and would, therefore, be considered a contract claim and subject to the same 8-year period in § 2305.06.

The remaining claim—punitive damages—is not a claim that is recognized under Ohio law. See Moskovitz v. Mt. Sinai

Med. Ctr., 635 N.E.2d 331, 342 (Ohio 1994) (holding that an individual and separate claim for punitive damages is

not allowed under Ohio law).

9 In support, defendants append to their motion various documents from the foreclosure proceedings and from the

Ohio Secretary of State. (See Doc. No. 18-1 (Certificate of Dissolution); Doc. No. 18-2 (Complaint in Foreclosure).)

Defendants also reference the docket from the Portage County Court of Common Pleas in BGC, LLC v. Barrington

Golf Club, Inc., et al., No. 2011-cv-1259 (Portage Cnty. Ct. of Common Pleas 2011). It is well settled that the Court

may consider these public documents and take judicial notice of state court proceedings without converting

defendants’ motion to dismiss into a motion for summary judgment. See Bassett v. Nat’l Coll. Athletic Ass’n, 528 F.3d

426, 430 (6th Cir. 2008) (citing Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001)).

12

reasonable efforts by White to inquire would have equipped him with sufficient knowledge to

appreciate that his equity membership had been compromised or no longer existed, potentially

giving rise to his claims. (Id. at 10.) Given that White was aware of his claims sometime in 2012,

at the latest, defendants insist that all of his claims, filed ten years later, would be time-barred.

White disagrees. He argues that he was never “actually” put on notice by defendants of the

foreclosure action involving Barrington. (Doc. No. 23, at 6.) Rather, he did not actually become

aware of the foreclosure until December 2021, when Ford mailed White a copy of a letter sent to

members informing them BGC would be filing a foreclosure action against Barrington. (Id.; see

Doc. No. 6-3, at 1.)10 It is White’s position that the statute of limitations should begin to run from

the date of the letter (December 9, 2021). (Doc. No. 23, at 6; see Doc. No. 6-3, at 1.)

When White received “actual” knowledge of the foreclosure is irrelevant to the present

inquiry. “[U]nder Ohio law, it is ‘constructive knowledge of facts’ that triggers the statute of

limitations for fraud-based claims under the discovery rule. That standard requires only ‘facts

sufficient to alert a reasonable person of the possibility of fraud.’” Joseph v. Joseph, No. 19-3350,

2022 WL 3536273, at *8 (6th Cir. Aug. 18, 2022) (quoting Cundall, 909 N.E.2d at 1250 (emphasis

in original)). The discovery rule “impose[s] upon the plaintiff a positive duty to use diligence in

discovering the existence of a cause of action.” Med. Mut. of Ohio v. K. Amalia Enters. Inc., 548

F.3d 383, 391 (6th Cir. 2008) (quoting Herm v. Stafford, 663 F.2d 669, 682 (6th Cir. 1981)). “When

10 In this correspondence, Ford informs White that she has “sent [him] several of the enclosed letters over the years.”

(Doc. No. 6-3, at 1.) Defendants complain that White conveniently does not attach the referenced enclosed letter from

2012. It argues that, had White attached the referenced letter to the amended complaint, it would be clear that White

received actual notice of the foreclosure plans in 2012. (Doc. No. 18, at 8.) White insists, however, that defendants

have not demonstrated that he actually received the referenced letter at any time before Ford’s correspondence in

December 2021. (Doc. No. 23, at 7.) The Court need not determine whether it may consider this undisclosed letter on

a motion to dismiss because it is clear from the existing record that the claims are time-barred.

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determining whether the exercise of reasonable diligence should have discovered a case of fraud,

the relevant inquiry is whether the facts known would lead a fair and prudent man, using ordinary

care and thoughtfulness, to make further inquiry[.]” Cundall, 909 N.E.2d at 1250 (quotation marks

and citations omitted).

Here, by his own admissions, White was on notice as early as 2012 that Barrington was

experiencing financial troubles that prevented the sale of his equity membership. (Doc. No. 6 ¶ 2.)

He also knew during this time period—again by his own admission—of possible foreclosure

proceedings. (Id. ¶ 3.) The Court finds that such knowledge would have led a fair and prudent

individual to use ordinary care and diligence to make further inquiry. Upon such an inquiry, White

would have discovered the foreclosure proceedings, the sale of Barrington’s assets, and

Barrington’s dissolution, providing him with everything he needed to timely bring his claims in

federal or state court. Accordingly, the Court finds that, to the extent it has jurisdiction, all of

White’s tort claims are time-barred.11

11 A cause of action for breach of contract accrues at the time “the complaining party suffers actual damages as a result

of the alleged breach.” Kincaid v. Erie Ins. Co., 944 N.E.2d 207, 210 (Ohio 2010) (quotation marks and citation

omitted). Because the discovery rule does not apply to Ohio breach of contract claims, the Court finds that White’s

breach of contract claim accrued when his equity membership was sold at public auction on February 13, 2012. See

Taylor-Winfield Corp. v. Huntington Bank, No. 2021-T-0015, 2021 WL 4477453, at *4 (noting that “no Ohio Court

has ever applied the discovery rule to a claim for breach of contract” (quotation marks and citations omitted)). (See

BGC, LLC v. Barrington Golf Club, Inc., et al., No. 2011-cv-1259 (Portage Cnty. Ct. of Common Pleas 2011)

(docket).) As a result, White’s contract claim is also untimely.

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IV. CONCLUSION

For the foregoing reasons, defendants’ motion to dismiss is GRANTED, and this case is

DISMISSED.

IT IS SO ORDERED.

Dated: June 22, 2023 bin me

HONORABLE SARA LIOI

UNITED STATES DISTRICT COURT

CHIEF JUDGE

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