Hollander, Jacque v. Brown, James

In the

United States Court of Appeals

For the Seventh Circuit

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No. 05-3176

JACQUE HOLLANDER,

Plaintiff-Appellant,

v.

JAMES BROWN and BROWN ENTERPRISES,

INCORPORATED,

Defendants-Appellees.

____________

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 05 C 57—Sidney I. Schenkier, Magistrate Judge.

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ARGUED FEBRUARY 23, 2006—DECIDED AUGUST 9, 2006

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Before EASTERBROOK, RIPPLE and WOOD, Circuit Judges.

RIPPLE, Circuit Judge. Jacque Hollander appeals the

dismissal, on statute of limitations grounds, of a personal

injury action that she brought against James Brown and

Brown Enterprises for an alleged 1988 incident of sexual

assault. Ms. Hollander submits that the limitations period

should not have begun until 2003, when she was informed

by her physicians that the 1988 sexual assault had caused

her to suffer from a condition known as Graves’ disease. For

the reasons set forth in this opinion, we affirm the judgment

of the district court.

2 No. 05-3176

I

BACKGROUND

A. Facts

The complaint alleges the following facts; we must accept

them as true in reviewing a Rule 12(b)(6) dismissal. See

Moranski v. Gen. Motors Corp., 433 F.3d 537, 539 (7th Cir.

2005).

In the late 1980s, James Brown Enterprises, Inc. (“Brown

Enterprises”), hired the plaintiff, Ms. Hollander, as a public

relations assistant. Some time in April 1988, there was a

meeting between Mr. Brown and Ms. Hollander at the

offices of Brown Enterprises in Augusta, Georgia. As the

meeting was wrapping up, Mr. Brown invited Ms. Hol-

lander to take a ride with him to see a car that he was

having customized. Ms. Hollander agreed, and the two

drove to a nearby car dealership.

On the way back from the dealership, Mr. Brown alleg-

edly began driving erratically and exited the highway

onto a deserted piece of land in South Carolina. There,

according to Ms. Hollander’s complaint, he proceeded to

beat, rape and psychologically torture her over the course of

several hours. Mr. Brown then returned Ms. Hollander to

Augusta and threatened to have her killed if she told

anyone what had happened.

Ms. Hollander alleges that, some twelve years later, she

was diagnosed with a condition known as Graves’ disease,

an auto-immune deficiency that affects the thyroid gland

and causes low energy, depression and mood swings. Three

years later, in 2003, Ms. Hollander was informed by a

physician that the cause of her Graves’ disease was the rape

and torture allegedly perpetrated by Mr. Brown in 1988.

No. 05-3176 3

B. District Court Proceedings

On January 5, 2005, invoking the district court’s diversity

jurisdiction, Ms. Hollander brought this action against

Mr. Brown and Brown Enterprises in the Northern District

of Illinois. Counts I through III asserted claims against

Mr. Brown for false imprisonment, intentional infliction

of emotional distress, sexual assault and battery. Count IV

alleged negligence against both Mr. Brown and Brown

Enterprises. Count V claimed that Brown Enterprises

was vicariously liable for Mr. Brown’s actions under the

doctrine of respondeat superior.

On February 16, 2005, Mr. Brown and Brown Enterprises

joined in filing a motion to dismiss under Federal Rule of

Civil Procedure 12(b)(6). The district court granted the

motion, holding that Ms. Hollander’s action was barred by

the two-year statute of limitations that governs tort claims

for personal injury in Illinois.1 See 735 ILCS 5/13-202. Under

that statute, the two-year limitations period begins when the

“cause of action accrued.” Id. In determining the accrual

1

It is, of course, “irregular” to dismiss a claim as untimely under

Rule 12(b)(6). United States v. N. Trust Co., 372 F.3d 886, 888 (7th

Cir. 2004). Under Federal Rule of Civil Procedure 8, a complaint

need not anticipate or overcome affirmative defenses such as the

statute of limitations. See Xechem, Inc. v. Bristol-Myers Squibb Co.,

372 F.3d 899, 901 (7th Cir. 2004). As a result, a federal complaint

does not fail to state a claim simply because it omits facts that

would defeat a statute of limitations defense. However, as the

district court observed, dismissal under Rule 12(b)(6) on the basis

of a limitations defense may be appropriate when the plaintiff

effectively pleads herself out of court by alleging facts that are

sufficient to establish the defense. See United States v. Lewis, 411

F.3d 838, 842 (7th Cir. 2005). The district court concluded that this

was such a case.

4 No. 05-3176

date of Ms. Hollander’s claim, the district court began by

noting two basic principles of Illinois law: (1) that a cause of

action accrues at the time a plaintiff’s interests are invaded;

and (2) that, under the “discovery rule,” a plaintiff also must

know, or be on reasonable notice, that her interests have

been invaded before the limitations period begins to run.

R.21 at 4.

In rejecting Ms. Hollander’s claim that the discovery rule

should extend the statute of limitations in this case, the

court distinguished between the late realization of one’s

injury from the late realization of the extent of that injury. In

the district court’s view, Ms. Hollander’s allegations

described a sudden, traumatic injury that was, or should

have been, obvious to her at the moment it occurred. The

court therefore ruled that her discovery of the full extent of

her injury, some fifteen years later, did not provide a basis

for extending the statute of limitations.

The court also rejected Ms. Hollander’s claim that the

statute of limitations should have been tolled because she

feared retaliation from Mr. Brown.

II

DISCUSSION

A.

We first address whether the district court erred in

concluding that Ms. Hollander’s action was time-barred.

Under the familiar rule of Erie Railroad Co. v. Tompkins, 304

U.S. 64 (1938), we apply Illinois2 substantive law to resolve

2

The parties do not contend in this appeal that any other

(continued...)

No. 05-3176 5

this question. See Guaranty Trust v. York, 326 U.S. 99, 110

(1945) (holding that statutes of limitations are considered

substantive matters for purposes of the Erie doctrine).

Further, as a consequence of our obligation under Erie, we

shall not anticipate changes to state law in the absence of

concrete evidence that the state court would adopt that

position today. See Birchler v. Gehl Co., 88 F.3d 518, 521 (7th

Cir. 1996). Indeed, we have warned litigants that those who

seek to base their claims on an innovation in state law

would be well-advised to file their claims in state court. See

id.; Shaw v. Republic Drill Corp., 810 F.2d 149, 150 (7th Cir.

1987) (per curiam).

Under the Illinois Code of Civil Procedure, the statute of

limitations for personal injury claims requires that an action

be commenced within two years of the date on which the

cause of action accrued. See 735 ILCS 5/13-202. As a general

rule, a cause of action for personal injury accrues when the

plaintiff suffers the injury. To alleviate the harshness that

would flow from literal application of this general principle,

Illinois courts also recognize a “discovery rule.” See, e.g.,

Parks v. Kownacki, 737 N.E.2d 287, 294 (Ill. 2000). The effect

of the discovery rule “is to postpone the commencement of

the relevant statute of limitations until the injured plaintiff

knows or reasonably should know that he has been injured

and that his injury was wrongfully caused.” Golla v. Gen.

Motors Corp., 657 N.E.2d 894, 898 (Ill. 1995).

In determining when a plaintiff reasonably should have

discovered her injury, Illinois courts distinguish between

injuries caused by sudden, traumatic events and those that

have a late or “insidious” onset. See Hauk v. Reyes, 616

2

(...continued)

state’s law should govern the dispute.

6 No. 05-3176

N.E.2d 358, 360 (Ill. App. Ct. 1993). For limitations purposes,

a “sudden, traumatic event” is one that, because of its force

or violence, permits the law to presume that the event

immediately placed the plaintiff on notice of her injury and

a right of action. See Golla, 657 N.E.2d at 899. When a

plaintiff suffers this type of injury, her cause of action

accrues on the date of the traumatic event, and the limita-

tions period does not begin anew simply because a latent

condition later may arise from the same occurrence. See id.

The rationale is that “the nature and circumstances sur-

rounding the traumatic event are such that the injured party

is thereby put on notice that actionable conduct might

be involved.” Id.

In insidious onset cases, by contrast, the nature of the

event does not permit the plaintiff to learn of her injury, or

of the causal link between the defendant’s conduct and her

injury, until some time after the event. For example, a

plaintiff who has been exposed unknowingly to asbestos

may not discover until years later that she now has cancer

and that the exposure was its cause. See, e.g., Nolan v.

Johns-Manville Asbestos, 421 N.E.2d 864, 866 (Ill. 1981). In

such situations, the discovery rule starts the statute of

limitations from the date when the plaintiff discovers, or

reasonably could discover, both her injury and the causal

connection between her injury and the tortious conduct. See

id. at 868.

Ms. Hollander submits that her injuries from the 1988

sexual battery were not sudden, but rather “slow and

cumulative.” Appellant’s Br. at 10. The thrust of Ms.

Hollander’s argument is that the psychological trauma of

the rape made discovery of her full injury a slow and

lengthy process. Notably, Ms. Hollander does not contend

either that she repressed memories of her encounter with

No. 05-3176 7

Mr. Brown or that she was unaware of the fact that she had

been sexually assaulted until she was diagnosed with

Graves’ disease. Additionally, Ms. Hollander does not

appear to be arguing that she ever was unaware of the false

imprisonment and intentional infliction of emotional

distress that she allegedly suffered at the hands of Mr.

Brown.

It may well be that Ms. Hollander, like many victims of

traumatic injury, only gradually came to understand the full

extent of the injuries that the rape caused. However, Illinois,

whose law we are obliged to apply under the Erie doctrine,

see Erie R.R. Co., 304 U.S. at 78, has made it clear that this

circumstance does not justify the application of the discov-

ery rule. In Clay v. Kuhl, 727 N.E.2d 217, 221 (Ill. 2000), the

Supreme Court of Illinois was asked to apply the discovery

rule and save an otherwise time-barred claim brought by

a woman who had been abused sexually as a child. The

plaintiff had alleged that the abuse began when she

was nine years old and continued until she was fifteen or

sixteen. She reached the age of majority in 1982, but did not

bring suit until 1996, when she was nearly thirty-two years

old. In urging the court to delay the running of the limita-

tions period, she contended that her injuries were latent and

did not manifest themselves fully until years after the abuse

had occurred. The court rejected this argument and held

that “[t]here is no requirement that a plaintiff must know

the full extent of his or her injuries before suit must be

brought under the applicable statute of limitations.” Id. at

222.

In the case before us, the allegations of the complaint

make clear that Ms. Hollander knew she had suffered at

least some injuries at the time of the incident in 1988. For

instance, she alleged that she did not consent to the sexual

8 No. 05-3176

intercourse with Mr. Brown, see R.1 at 6, and that she was

aware at the time of the incident that she was falsely

imprisoned, see id. at 5. Because Illinois law presumes a

resulting injury from unwanted touching and unlawful

restraint, see Doe By & Through Doe v. Montessori Sch. of Lake

Forest, 678 N.E.2d 1082, 1089 (Ill. App. Ct. 1997), these

allegations make clear that she could have filed suit within

the limitations period. Indeed, Ms. Hollander does not

contend that those immediate injuries were not actionable,

only that the development of the full injury occurred slowly.

In the words of the Supreme Court of Illinois, she is “not a

plaintiff who failed to discover any injury, but a plaintiff

who failed to discover the full extent of her injuries before

the statute of limitations expired.” Golla, 657 N.E.2d at 901

(emphasis in original). This type of plaintiff cannot benefit

from the Illinois discovery rule.

B.

In the alternative, Ms. Hollander asserts that Illinois’

doctrine of equitable estoppel should bar Mr. Brown from

taking advantage of her delay in filing suit. She explains

that she postponed her action for fear of retaliation by Mr.

Brown who, she alleges, threatened to kill her if she told

anyone of the incident.

Like the statute of limitations itself, rules that are

an “integral part of the statute of limitations,” such as

tolling and equitable estoppel, are treated as substantive for

purposes of the Erie doctrine. See Walker v. Armco Steel Corp.,

446 U.S. 740, 751-53 (1980); Wade v. Danek Med., Inc., 182

F.3d 281, 289 (4th Cir. 1999) (holding that “in any case in

which a state statute of limitations applies . . . the state’s

accompanying rule regarding equitable tolling should also

No. 05-3176 9

apply”). Thus, in addressing Ms. Hollander’s equitable

estoppel contention, we look to Illinois law for the applica-

ble rule of decision. See, e.g., Singletary v. Cont’l Ill. Nat’l Bank

& Trust Co. of Chicago, 9 F.3d 1236, 1241 (7th Cir. 1993)

(applying state principles of equitable estoppel in a diversity

action).

In Illinois, the doctrine of equitable estoppel suspends the

running of the statute of limitations during any period in

which the defendant took certain active steps to prevent the

plaintiff from suing.3 The Illinois courts apply this doctrine

most typically in situations where the defendant has

“lulled” the plaintiff into delaying suit, either by promising

not to plead a limitations defense or by concealing evidence

that the plaintiff needed to determine the existence of her

claim. See, e.g., Swann & Weiskopf, Ltd. v. Meed Assocs., Inc.,

711 N.E.2d 395, 401 (Ill. App. Ct. 1999); Beynon Bldg. Corp. v.

Nat’l Guardian Life Ins. Co., 455 N.E.2d 246, 252 (Ill. App. Ct.

3

The Illinois cases appear, at times, to use “equitable estoppel”

interchangeably with the related principle of equitable tolling. See

Smith v. City of Chicago Heights, 951 F.2d 834, 839 n.5 (7th Cir.

1992) (recognizing the overlap in Illinois law). The cases of this

court have distinguished equitable tolling as a rule that “permits

a plaintiff to sue after the statute of limitations has expired if

through no fault or lack of diligence on his part he was unable to

sue before, even though the defendant took no active steps

to prevent him from suing.” Singletary v. Cont’l Ill. Nat’l Bank &

Trust Co. of Chicago, 9 F.3d 1236, 1241 (7th Cir. 1993). The Su-

preme Court of Illinois, by contrast, defines equitable tolling as

a rule that, like equitable estoppel, works to suspend the limita-

tions period when “the defendant has actively misled the

plaintiff, or if the plaintiff has been prevented from asserting his

or her rights in some extraordinary way.” Clay v. Kuhl, 727 N.E.2d

217, 221 (Ill. 2000).

10 No. 05-3176

1983) (“Although there is ordinarily no duty to apprise an

adversary of his rights, one cannot justly or equitably lull

his adversary into a false sense of security, causing him to

subject his claim to the bar of the statute, and then plead the

very delay caused by his course of conduct.”). Some Illinois

cases also appear to recognize equitable estoppel in a

broader sense as a doctrine that “prevents a party from

taking advantage of his own wrongdoing.” Neaterour v. Holt,

544 N.E.2d 846, 851-52 (Ill. 1989). As one Illinois appellate

court has stated: “The test is whether, considering all the

circumstances of the case, conscience and honest dealing

require that the defendant be estopped.” Franke v. Geyer, 568

N.E.2d 931, 934 (Ill. App. Ct. 1991).

Most recently, however, the Supreme Court of Illinois has

indicated that equitable estoppel is available only when the

defendant has used misrepresentations or

concealment—rather than threats of reprisal—to prevent the

plaintiff from suing. In Parks v. Kownacki, 737 N.E.2d 287 (Ill.

2000), a former parishioner brought an action claiming that

a parish priest had sexually abused her when she was a

minor. She did not file her complaint until twenty-two years

after she had reached the age of majority, and the defen-

dants pleaded the statute of limitations as a defense. In

response, the plaintiff contended that, because the priest

had threatened her and her family with violent retribution

if she were to sue, equitable estoppel should preclude the

defendants from invoking the statute of limitations. Reject-

ing this contention, the court held that the “[p]laintiff clearly

has not pleaded the elements of equitable estoppel.” Id. at

296. Continuing, the court reasoned:

She does not allege that any defendant misrepresented

or concealed any material fact. She alleges only that

defendants asked plaintiff to forgive them and to refrain

No. 05-3176 11

from suing them. In fact, at oral argument plaintiff

admitted that she could not demonstrate a misrepresen-

tation or concealment. Without the misrepresentation or

concealment of a material fact, equitable estoppel does

not apply.

Id.

The statements of the Supreme Court of Illinois in Parks

control this case. We express no view, of course, on whether

Parks announced the correct approach or on whether it

applied the doctrine of equitable estoppel correctly to the

facts before it. It suffices that Ms. Hollander’s theory of

equitable estoppel is materially identical to the one asserted

by the plaintiff in Parks. Like the Parks plaintiff, Ms. Hol-

lander claims that a threat of violence, rather than a misrep-

resentation, prevented her from filing suit. As Ms. Hol-

lander concedes in her appellate brief, this claim does not

conform to the equitable estoppel paradigm established by

the Illinois case law. She submits, nevertheless, that in

resolving her motion to dismiss we must assume that Mr.

Brown was lying when he threatened to kill her, and that his

statement therefore was technically a misrepresentation. The

court in Parks was unwilling to make that assumption.

Consistent with our obligations under Erie, neither may we.

Conclusion

For the foregoing reasons, the judgment of the dis-

trict court is affirmed.

AFFIRMED

12 No. 05-3176

A true Copy:

Teste:

_____________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit

USCA-02-C-0072—8-9-06