Opinion
No. 1-17-2860
12-07-2018
ALEX GU, Plaintiff-Appellant, v. ST. FRANCIS HOSPITAL, Defendant-Appellee.
NOTICE: This order was filed under Supreme Court Rule 23 and may not be cited as precedent by any party except in the limited circumstances allowed under Rule 23(e)(1). Appeal from the Circuit Court of Cook County. No. 16 M2 2218 Honorable Jeffrey L. Warnick, Judge Presiding. JUSTICE CUNNINGHAM delivered the judgment of the court.
Justices Connors and Harris concurred in the judgment.
ORDER
¶ 1 Held: We affirm the dismissal of plaintiff-appellant's complaint under the doctrine of res judicata. However, we reverse the circuit court's entry of sanctions against plaintiff. ¶ 2 Plaintiff Alex Gu (plaintiff) appeals from the order of the circuit court of Cook County dismissing his complaint on the basis of res judicata, as well as from the circuit court's subsequent award of Rule 137 sanctions to defendant-appellee, Presence Chicago Hospitals Network d/b/a Presence Saint Francis Hospital (defendant). For the following reasons, we affirm the dismissal of plaintiff's complaint, but we reverse the imposition of Rule 137 sanctions.
Plaintiff's complaint erroneously identifies defendant as "St. Francis Hospital."
¶ 3 BACKGROUND
¶ 4 Plaintiff formerly served as a surgical assistant at Presence Saint Francis Hospital in Evanston (St. Francis), as well as Presence Saint Joseph Medical Center in Joliet, Illinois (St. Joseph). ¶ 5 Prior to the instant action, plaintiff filed three pro se lawsuits in the United States District Court for the Northern District of Illinois (the district court), related to the termination of his privileges at St. Francis and St. Joseph. We summarize those actions, to the extent they are relevant to the instant lawsuit. ¶ 6 In 2011, plaintiff filed a lawsuit in the district court against "Provena St. Joseph Medical Center Joliet IL" and two individual defendants (the 2011 lawsuit.) The 2011 lawsuit was based on the termination of his privileges at St. Joseph in August 2009. The corresponding complaint alleged that the termination of privileges followed an April 2009 surgery, for which the patient's insurer had paid only $269 of the $1230 billed by plaintiff. Plaintiff contacted the patient directly about the bill, and asked the patient to contact the insurer to request a "reasonable payment, then [plaintiff] would write off all outstanding balance $960.04." The patient allegedly responded by threatening to seek plaintiff's termination from St. Joseph. Plaintiff alleged that his surgical privileges were later revoked, without any written explanation. ¶ 7 Plaintiff's complaint in the 2011 lawsuit alleged violation of his due process rights under the Fifth and Fourteenth Amendments to the United States Constitution; wrongful termination; and unlawful discrimination in violation of Title VII of the Civil Rights Act of 1964. In March 2012, the district court entered summary judgment in favor of the defendants and dismissed the 2011 lawsuit. The United States Court of Appeals for the Seventh Circuit affirmed that dismissal. ¶ 8 In 2012, plaintiff filed another action (the 2012 lawsuit) against "Resurrection Health Care Saint Francis Hospital," as well as two individual defendants. The 2012 lawsuit (like the lawsuit at issue in this appeal) was based on the termination of plaintiff's privileges at St. Francis. As alleged in the 2012 pro se complaint, plaintiff was scheduled to assist in two surgeries on the same date in July 2011. The first was a morning heart surgery at St. Francis and the second was an afternoon surgery at a different hospital. The morning surgery at St. Francis was delayed, and so plaintiff "had to get other Medical Staff to t[ake]over that job." Plaintiff alleged that, only after he had obtained permission from the operating surgeon and "charge nurse" at St. Francis did he leave. However, he left before the completion of the first surgery, in order to attend the second surgery. ¶ 9 According to plaintiff, on July 14, 2011, St. Francis terminated his privileges, claiming violations for "Jeopardizing Patient" and "Leav[ing] Working Area Without Permission." Plaintiff alleged that he contacted the "director of HR" to request "Board Review for this Wrongful Termination" but was told that Board Review was available only for employees but "not applicable for Register Position." He alleged that he "believed this case involved some Age and National Origin Discrimination." ¶ 10 Plaintiff's initial complaint in the 2012 lawsuit alleged violation of his due process rights under the Fifth and Fourteenth Amendments of the United States Constitution, as well as "wrongful termination" and "unlawful discrimination" in violation of Title VII of the Civil Rights Act of 1964. In October 2012, plaintiff filed an amended complaint containing claims for (1) "racial discrimination in improper[] discharge" under section 1981 of the United States Code (42 U.S.C. § 1981); (2) a claim under Title VII of the Civil Rights Act of 1964 for "Nation[al] Origin Discrimination"; (3) violation of the "The Age Discrimination in Employment Act of 1967"; and (4) "Conspiracy to Interfere with Civil Rights" under section 1985 of the United States Code (42 U.S.C. § 1985). ¶ 11 On October 16, 2012, the district court dismissed the 2012 lawsuit sua sponte, having "determine[d] that plaintiff has not plead[ed] a federal case." That dismissal was subsequently affirmed on appeal. ¶ 12 In August 2013, plaintiff filed a third pro se complaint (the 2013 lawsuit) against the same defendants that he had sued in the 2011 lawsuit. Like the 2011 lawsuit, the 2013 lawsuit was based on the August 2009 termination of his privileges at St. Joseph after he contacted a patient about a bill. The 2013 lawsuit included claims for racial discrimination under 42 U.S.C. § 1981 and "Conspiracy to Interfere With Civil Right[s]" under 42 U.S.C. § 1985. ¶ 13 In October 2013, the district court dismissed the 2013 lawsuit on the basis of res judicata, finding that "the present lawsuit is based on the exact same facts as Plaintiff's 2011 lawsuit." The district court noted that although plaintiff had "changed his theories of liability" from the 2011 lawsuit, this was "of no moment because '[c]laim preclusion prohibits litigants from relitigating claims that were or could have been litigated during an earlier proceeding.' [Citation.]" ¶ 14 In the same order dismissing the 2013 lawsuit, the district court declined defendant's request to impose sanctions against plaintiff under Rule 11 of the Federal Rules of Civil Procedure, explaining:
"Although pro se litigants have the same duty under Rule 11 as licensed attorneys, because Plaintiff did not understand that the first lawsuit barred his different theories of liability in the second lawsuit, the Court cannot conclude that Plaintiff knew his position was groundless. [Citation.] The Court, however, puts Plaintiff on notice that if he continues to file lawsuits based on these same facts against these same Defendants, sanctions—such as attorney's fees and costs—may be deemed appropriate."¶ 15 In June 2016, plaintiff commenced the action that is the subject of this appeal, filing a pro se complaint that named "St. Francis Hospital" as the sole defendant. Like the 2012 lawsuit, the instant lawsuit is based on the July 2011 termination of his privileges from St. Francis in July 2011. Similar to his 2012 lawsuit, his complaint in this action alleges that his termination occurred after he was scheduled to assist in two surgeries on the same day:
"The Event on July 7, 2011, [plaintiff] had scheduled two Surgical Service in different Hospital, First case 7:30 a.m. in St[.] Francis Hospital and Second case 1:30 p.m. in McNeal Hospital. For reasons, first case was started to delay, after [plaintiff] finished major procedure, then got permission from performed surgeon -- Dr. Deboer, then left for second hospital.
On July 14, 2011, director of Surgical Service Abraham, Aney called [plaintiff] for conference, [t]hen presented "Resurrection Health Care Employee Discipline Notice" for termination, [that] alleged that Plaintiff Alex Gu violated "RHC
3.10 - Jeopardizing Patient" and 'RHC 4.12-Leave working area without permission' ***."Plaintiff alleges that he requested application of St. Francis' "grievance procedure" and he "tried to present[] his own evidence ***, but St. Francis Hospital denied and deprived Gu's right, but this policy has been applied in other employee[s] except [plaintiff.]" Unlike his 2012 lawsuit, the complaint in this action does not assert any claims under federal law. Rather, it claims that defendant committed "fraudulent misrepresentation" and "conspiracy" in connection with his termination. ¶ 16 On February 27, 2017, defendant moved to dismiss the complaint under section 2-619.1 of the Code of Civil Procedure (Code) (735 ILCS 5/2-619.1 (West 2016)), setting forth alternative arguments for dismissal. Defendant's motion first argued that dismissal was proper under section 2-619 of the Code (735 ILCS 5/2-619 (West 2016)), because res judicata barred the lawsuit in light of the district court's dismissal of the 2012 lawsuit, which arose from the same underlying facts. Defendant otherwise argued that dismissal was warranted by section 2-615 of the Code (735 ILCS 5/2-615 (West 2016)) because plaintiff failed to state a cause of action for fraudulent misrepresentation or conspiracy. ¶ 17 In conjunction with its motion to dismiss, defendant also sought sanctions against plaintiff under Illinois Supreme Court Rule 137 for plaintiff's "aggressive pursuit of baseless litigation." Defendant emphasized that plaintiff "was previously advised" about the application of res judicata and potential sanctions by the district court's order dismissing the 2013 lawsuit. Defendant argued that "[plaintiff]'s behavior can be reasonably construed only as vexatious and harassing" and requested that plaintiff be required to reimburse defendant's fees and costs in defending the instant lawsuit. ¶ 18 On March 27, 2017, the trial court granted defendant's motion to dismiss, with prejudice, on the basis of res judicata. At the same time, the court directed defendant to submit a Rule 137 petition and supporting affidavit by June 1, 2017, directed plaintiff to respond by July 14, 2017, and set a corresponding hearing for July 25, 2017. ¶ 19 On June 1, 2017, defendant filed a petition for attorneys' fees supported by an affidavit attaching itemized bills from its counsel, Seyfarth Shaw, LLP. The petition sought $14,795.76 in legal fees and costs incurred in defending the instant lawsuit. ¶ 20 On July 13, 2017, (the day before his response was due), plaintiff moved for an extension of time to respond to defendant's Rule 137 petition, claiming that he had been out of the country from late May until July 12, 2017. Plaintiff noticed that motion for July 25, 2017, the date previously scheduled as the hearing date on the petition for sanctions. ¶ 21 On July 25, 2017, the trial court entered an order denying plaintiff's motion to extend the deadline for his response, finding that "plaintiff waived his right to respond to Defendant's motion for sanctions and petition for fees." The same order reflected that the trial court "heard full and complete argument on Defendant's motion for sanctions and petition for attorneys' fees" and would issue a subsequent decision. ¶ 22 On August 21, 2017, plaintiff filed a "Motion to Re-Hearing in Post-Judgment" (motion for re-hearing), arguing that the trial court erred in applying res judicata to dismiss his lawsuit. ¶ 23 On September 19, 2017, the trial court issued an order granting defendant's petition for Rule 137 sanctions. The trial court remarked that the instant lawsuit was "plaintiff's fourth bite at the same parties." The trial court stated: "All four of plaintiff's lawsuits arose out of a single set of operative facts, i.e., the termination of [plaintiff]'s privileges after he walked out of open heart surgery." The trial court also noted that, in dismissing the 2013 lawsuit, the district court "warned plaintiff *** about the risk of future sanctions should he pursue this further." Finding that the defendant's attorneys' fees were "customary and reasonable," the trial court awarded $14,795.76 in attorneys' fees and costs as Rule 137 sanctions against plaintiff. ¶ 24 On October 18, 2017, the trial court denied plaintiff's August 2017 motion for rehearing, specifying that it was a final and appealable order. On November 6, 2018, plaintiff filed a timely notice of appeal. Accordingly, this court has jurisdiction. Ill. S. Ct. R. 303 (eff. July 1, 2017).
In 2011, the former owners of St. Francis and St. Joseph combined to form Presence Health.
The name ascribed to the defendant in that complaint was erroneous, since by that time, St. Francis was already part of the Presence Health system.
¶ 25 ANALYSIS
¶ 26 At the outset, we note that plaintiff's pro se briefing in this court (like his trial court submissions) is repetitive, lacks clarity or cohesiveness, and contains numerous stylistic, grammatical and typographical errors. Many of his contentions are overlapping and, at times, difficult to comprehend. Nevertheless, from the numerous assertions in his briefs, we are able to discern the thrust of his two central challenges to the trial court's rulings. First, plaintiff contends that the trial court erred in dismissing his action on the basis of res judicata, as he claims that the elements of that doctrine were not satisfied, notwithstanding the district court's dismissal of his 2012 lawsuit. Second, he challenges the imposition of Rule 137 sanctions, as he claims that he acted in good faith and without any improper purpose. He otherwise claims that the court deprived him of "due process" when it denied his motion to extend his time to file his response to the petition for sanctions. ¶ 27 We first address the propriety of the dismissal of plaintiff's complaint. We note that defendant moved to dismiss the complaint under section 2-619.1 of the Code, which permits "combined motions" stating separate grounds for dismissal under sections 2-615 and 2-619 of the Code. Reynolds v. Jimmy John's Enterprises, LLC, 2013 IL App (4th) 120139, ¶ 20. Although defendant sought dismissal under either section 2-615 or 2-619, the trial court 9 premised dismissal in this case only upon section 2-619, under which "a defendant may file a motion for dismissal of the action on the grounds 'the claim asserted against defendant is barred by other affirmative matter avoiding the legal effect of or defeating the claim.' [Citation.]" Id. ¶ 30. "A motion for involuntary dismissal under section 2-619(a)(9) of the Code admits the legal sufficiency of the complaint, *** and asserts [that] an affirmative matter outside the complaint bars or defeats the cause of action. [Citations.]" Id. An affirmative matter is "something in the nature of a defense which negates the cause of action completely." Id. ¶ 33. "A section 2-619(a)(9) motion dismissal is reviewed de novo." Id. ¶ 31. ¶ 28 Application of res judicata may support dismissal under section 2-619. See Hudson v. City of Chicago, 228 Ill. 2d 462 (2008). "[W]hether a claim is barred by res judicata comprises a question of law, which also mandates de novo review by our court. [Citation.]" Agolf, LLC v. Village of Arlington Heights, 409 Ill. App. 3d 211, 218 (2011). ¶ 29 "The doctrine of res judicata provides that a final judgment on the merits rendered by a court of competent jurisdiction bars any subsequent actions between the same parties or their privies on the same cause of action. [Citation.] Res judicata bars not only what was actually decided in the first action but also whatever could have been decided. [Citation.] Three requirements must be satisfied for res judicata to apply: (1) a final judgment on the merits has been rendered by a court of competent jurisdiction; (2) an identity of cause of action exists; and (3) the parties or their privies are identical in both actions. [Citation.]" Hudson, 228 Ill. 2d at 467. "Once res judicata is established, its bar extends to all matters that were offered to sustain or defend the claim or demand, as well as to any and all other matters which may have or could have been offered for that purpose. [Citations.] Accordingly, while it is true that every plaintiff is entitled to his day in court and res judicata should not be applied to create fundamental 10 unfairness [citation], the critical nature of this doctrine operates to prevent repetitive lawsuits and protects parties from being forced to bear the burden of relitigating essentially the same claim over and over [citation.]" Agolf, 409 Ill. App. 3d at 218. ¶ 30 In this case, the trial court agreed with defendant that res judicata barred the instant lawsuit, in light of the district court's dismissal of the 2012 lawsuit. Plaintiff's appellate briefing does not dispute that the instant lawsuit arises from the same factual background as the 2012 lawsuit, i.e., the termination of his privileges at St. Francis after he allegedly left a surgery without permission. However, he contends that the dismissal of the federal claims in the 2012 lawsuit in federal court, could not preclude his pursuit of state law claims in the instant lawsuit. Although his argument is not entirely coherent, he repeatedly cites section 1367 of the United States Code, 28 U.S.C. § 1367, which affords a district court discretion to exercise supplemental jurisdiction over state law claims asserted in a federal court action. Plaintiff suggests that in his 2012 federal lawsuit, the district court exercised that discretion and declined to hear his state law claims, but preserved his right to pursue state law claims in state court. He claims that the "Federal Judge, pursuant to 28 USC [§]1367 (c) remanded State Issue 'Fraudulent Misrepresentation & Wrongful Termination' to State Court for further process - Without Full Hearing and Without Final Judgment." He thus claims there was "no final judgment" on his state law claims in the 2012 lawsuit, and so it cannot support res judicata to bar those claims in this action. ¶ 31 Plaintiff's argument is without merit. We acknowledge that plaintiff could have attempted to plead state law claims in his prior 2012 lawsuit in federal court. Had he done so, the district court could have potentially exercised supplemental jurisdiction. Further, we recognize that, where a federal court declines to exercise supplemental jurisdiction over state law 11 claims, its decision will not operate as res judicata barring the litigation of the state law claims in state court. Schandelmeier-Bartels v. Chicago Park District, 2015 IL App (1st) 133356, ¶¶ 30-31. However, plaintiff's argument is baseless, since there is nothing in the record suggesting that he ever sought to raise state law claims in his 2012 lawsuit. His 2012 pro se complaint simply did not plead any state law claims. Nor is there anything in the record to suggest that the federal court in the 2012 lawsuit ever suggested that plaintiff could bring state law claims arising from the same facts, either in that court or in a subsequent state court action. ¶ 32 Rather, we agree with defendant that all three elements of res judicata were established, supporting dismissal of the instant action. Regarding the first element, the district court's dismissal of the 2012 action was a final judgment on the merits rendered by a court of competent jurisdiction. See Nowak v. St. Rita High School, 197 Ill. 2d 381, 390 (2001) ("a dismissal of a complaint for failure to state a claim is an adjudication on the merits"). ¶ 33 As to the second element, there was an identity of cause of action between the 2012 lawsuit and the present lawsuit. "In order to determine whether there is an identity of cause of action, courts apply the 'transactional test.' [Citation.] '[P]ursuant to the transactional analysis, separate claims will be considered the same cause of action for purposes of res judicata if they arise from a single group of operative facts, regardless of whether they assert different theories of relief.' [Citation.]" Schandelmeier-Bartels, 2015 IL App (1st) 133356, ¶ 27. The 2012 lawsuit and the instant lawsuit are based on the same group of operative facts, as both actions arise from the termination of plaintiff's privileges at St. Francis in July 2011. 12 ¶ 34 Finally, plaintiff does not dispute that defendant in this case is in privity with the defendant he sued as "Resurrection Health Care Saint Francis Hospital" in the prior 2012 lawsuit. "[P]rivity exists between a party to the prior suit and a nonparty when the party to the prior suit 'adequately represent[ed] the same legal interests' of the nonparty." Agolf, 409 Ill. App. 3d at 220. "[P]rivity clearly exists between parties who share a mutual or successive relationship in property rights that were the subject of an earlier action. [Citation.]" Id. Defendant's submissions in the trial court explained that, as of November 2011, Resurrection Health Care Corporation and Provena Health joined to form Presence Health, which became the parent corporation of St. Francis. Plaintiff does not dispute those facts. Thus, all three elements of res judicata are present. In turn, plaintiff was precluded from asserting the state law claims in this case, that he could have, but failed to, assert in the 2012 lawsuit. ¶ 35 We agree with the trial court that res judicata constituted an affirmative matter that precluded the instant lawsuit. Thus, we affirm the trial court's dismissal pursuant to section 2-619 of the Code. ¶ 36 We now turn to a review of the trial court's subsequent decision to award defendant Rule 137 sanctions, in the amount of defendant's legal fees and costs. Plaintiff's brief argues that sanctions were inappropriate, because he acted with good faith in prosecuting this lawsuit, given his understanding of the applicable law and prior orders of the district court. Plaintiff's brief acknowledges that the district court's order dismissing his 2013 lawsuit against St. Joseph warned of sanctions if he "continued to file lawsuits based on the same facts against these same defendants." However, he argues that the district court's order only precluded further lawsuits against St. Joseph on the same facts, but did not preclude him from filing the current suit against defendant, St. Francis. 13 ¶ 37 Plaintiff otherwise reiterates his claim that he was permitted to bring state law claims in the circuit court, despite the prior dismissal of the 2012 lawsuit by the district court. Plaintiff reiterates his belief that the district court's discretion to exercise supplemental jurisdiction prevented the dismissal of his 2012 lawsuit from having res judicata effect in this subsequent action in the circuit court of Cook County. That is, he claims he "followed Federal Judge Gettleman and 28 [§]1367 (c) to remand State Issue to State Court for further processing." He asserts that Rule 137 is not applicable because he "has a Good-Faith Argument *** warranted by existing law" and denies that he acted with "any improper purpose" in pursuing the instant lawsuit. ¶ 38 Rule 137 provides, in relevant part: "The signature of an attorney or party constitutes a certificate by him that he has read the pleading, motion or other paper; that to the best of his knowledge, information, and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law or a good-faith argument for the extension, modification, or reversal of existing law, and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation." Ill. S. Ct. R. 137 (eff. Feb. 1, 1994). ¶ 39 "We review the trial court's imposition of Rule 137 sanctions under an abuse of discretion standard. [Citation.] *** The purpose of Rule 137 is to prevent the filing of false and frivolous lawsuits.' [Citation.] However, '[t]he rule is not intended to penalize litigants and their attorneys because they were zealous but unsuccessful in pursuing an action. [Citation.] 14 Further, Rule 137 requires that the trial court provide an explanation in imposing sanctions, and that a reviewing court may only affirm the imposition of sanctions on the grounds specified by the trial court. [Citation.] In reviewing the trial court's decision to impose sanctions, 'the primary consideration is whether the trial court's decision was informed, based on valid reasoning, and follows logically from the facts.' [Citations]." Nelson v. Chicago Park District, 408 Ill. App. 3d 53, 67-68 (2011). ¶ 40 Under the circumstances of this case, we find that the trial court offered an insufficient explanation to justify an award of sanctions, and thus the decision was an abuse of discretion. We acknowledge that there is no merit to plaintiff's arguments challenging the dismissal of this action, as the doctrine of res judicata clearly applied. The contents of plaintiff's submissions in the trial court and in this court make abundantly clear that plaintiff misunderstands many fundamental principles of civil procedure, including the doctrine of res judicata. Undoubtedly, much of his confusion is attributable to his pro se status. Indeed, this case exemplifies why people without legal training should hire lawyers to represent them in the courts. A competent attorney would have advised plaintiff that he could not simply refile a new action by pleading a new theory of relief on the same operative facts as a previously-dismissed lawsuit. ¶ 41 Nonetheless, although plaintiff's decision to proceed pro se was unwise, and this action was undoubtedly barred by res judicata, that does not mandate a conclusion that plaintiff lacked good faith. Significantly, in its order awarding sanctions, the trial court did not make any specific findings that plaintiff acted in bad faith or with intent to harass defendant. Further, the court's order was factually incorrect when it stated that "all four of plaintiff's lawsuit arose out of a single set of operative facts, i.e., the termination of Gu's privileges after he walked out of open heart surgery." Only the 2012 lawsuit and the instant lawsuit were based on that incident and the 15 resulting termination of his privileges at St. Francis. Plaintiff's other two lawsuits were based on the termination of his privileges at St. Joseph, after a separate incident involving patient billing. ¶ 42 We also note that the trial court's award of sanctions relied on the language from the district court's order dismissing the 2013 lawsuit, which warned plaintiff that he could be sanctioned "if he continued to file lawsuits based on these same facts against these same Defendants." As plaintiff's brief points out, the instant lawsuit actually did not involve "the same facts" or the "same defendants" as the 2013 action that was the subject of the district court's earlier warning. Especially considering plaintiff's pro se status, he has at least a good-faith argument that the 2013 order did not sufficiently apprise him of sanctions if he brought another action involving the termination of his privileges at St. Francis, which was not related to the 2013 lawsuit and the termination of his privileges at St. Joseph. ¶ 43 In short, we do not find that the trial court adequately explained why plaintiff's pursuit of this action exhibited such a lack of good faith or improper purpose, so as to warrant the sanctions imposed. Plaintiff, without the benefit of an attorney's advice, seems to have a genuine, though obviously incorrect, belief that he was entitled to pursue the instant action. Rule 137 seeks to punish bad faith conduct, not merely ill-informed decisions by pro se litigants. Accordingly, we reverse the trial court's award of sanctions. ¶ 44 For the foregoing reasons, we affirm the judgment of the circuit court of Cook County to the extent it dismissed plaintiff's complaint, but we reverse the circuit court's subsequent award of Rule 137 sanctions. ¶ 45 Affirmed in part; reversed in part.