In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 15‐1538
CARLOS G. ROCHA,
Plaintiff‐Appellant,
v.
J. GORDON RUDD, JR., ANNE T. REGAN, PATRICIA A.
BLOODGOOD, ZIMMERMAN REED PLLP, GREGORY J. MEYERS,
SUSAN ELLINGSTAD, and LOCKRIDGE GRINDAL NAUEN PLLP
Defendants‐Appellees.
____________________
Appeal from the United States District Court for the
Northern District of Illinois, Eastern Division.
No. 14 C 4857 — Milton I. Shadur, Judge.
____________________
ARGUED NOVEMBER 4, 2015 — DECIDED JUNE 22, 2016
____________________
Before KANNE, ROVNER, and SYKES, Circuit Judges.
KANNE, Circuit Judge. Defendants, a group of law firms
and several of their attorneys, had previously represented
Plaintiff Carlos Rocha and other FedEx delivery drivers in an
employment misclassification case against FedEx. The em‐
ployment misclassification case ultimately settled, but Rocha
was excluded from the settlement. Just before the settlement
2 No. 15‐1538
was finalized, Rocha retained Johnson, his current spouse,
and discharged Defendants as his counsel. Rocha later sued
Defendants in federal district court, alleging several theories
of harm, including legal malpractice and fraud, in associa‐
tion with the case against FedEx. The district court dismissed
Rocha’s amended complaint, and Rocha appealed. We af‐
firm.
I. BACKGROUND
Although not a party here, much of this case’s back‐
ground involves FedEx, which includes FedEx Corporation
(“FedEx Corp.”) and its subsidiary FedEx Ground Package
System, Inc. (“FedEx Ground”), a business that provides
package delivery and pick‐up service.
From late 2005 until November 2010, “Rocha delivered
packages for FedEx’s Chicago terminal, acting at various
times as an employee and an independent contractor.” Rocha
v. FedEx Corp., 15 F. Supp. 3d 796, 800 (N.D. Ill. 2014). Rocha
is also the owner of Arize 11, an Illinois corporation formed
in 2008, through which he contracted with FedEx. Id.
A. Fluegel v. FedEx Ground Package Sys., Inc.
On April 20, 2005, a group of FedEx delivery drivers,
represented by Defendants, filed a putative class action law‐
suit against FedEx in the Northern District of Illinois. Fluegel
v. FedEx Ground Package Sys., Inc., No. 1:05‐cv‐02326, (N.D.
Ill. dismissed Sept. 17, 2012). Their key allegation was that
FedEx had misclassified them as independent contractors,
thereby denying them protections under the Illinois Wage
Payment and Collection Act (“IWPCA”), 820 ILCS 115/1 et
seq.
No. 15‐1538 3
Later that year, Fluegel was consolidated with other cases
in a multidistrict litigation (“MDL”) proceeding in the
Northern District of Indiana. In Fluegel, the MDL court de‐
nied class certification but granted partial summary judg‐
ment in favor of the plaintiffs, holding that they were em‐
ployees under the IWPCA. In re Fedex Ground Package Sys.,
Inc. Emp. Practices Litig., 2010 WL 2243246 at *1 (N.D. Ind.
2010). In the fall of 2010, the MDL court remanded Fluegel to
the Northern District of Illinois, and litigation on the case
continued.
On July 20, 2011, Rocha joined the Fluegel action. His re‐
tainer agreement with Defendants expressly limited the
scope of Defendants’ representation because he was pursu‐
ing other claims against FedEx on behalf of Arize 11, with
separate representation by Johnson (his spouse). The reten‐
tion agreement also affirmed Rocha’s “absolute right to ac‐
cept or reject any settlement” with FedEx negotiated by De‐
fendants.
By 2012, over 100 additional plaintiffs had joined the
Fluegel action. In April 2012, the parties in Fluegel agreed to
mediation. A month later, on May 25, 2012, the parties noti‐
fied the court that they had reached a tentative settlement.
Soon after, Defendants were notified by Rocha, through
Johnson, that he would object to the settlement if it required
release of his Arize 11 claims.
On June 5, 2012, Defendants explained in a letter to Ro‐
cha the material terms of the proposed settlement, including
the total settlement amount, each individual plaintiff’s por‐
tion, and attorney’s fees. Furthermore, this letter stated that
for the settlement, FedEx required “from every Plaintiff a
release of all claims against FedEx both individually and on
4 No. 15‐1538
behalf of any associated corporation.” This letter concluded
by reiterating Rocha’s ability to make the final determination
of whether to join the settlement. Throughout the summer of
2012, on multiple occasions, Defendants discussed with Ro‐
cha the proposed settlement terms, including the required
release of all claims by Rocha and Arize 11 against FedEx.
The parties in Fluegel filed a joint motion to approve the
settlement agreement, and on August 7, 2012, the district
court approved it.
On September 10, 2012, Johnson filed a notice of appear‐
ance as counsel for Rocha in Fluegel. On September 14, 2012,
Defendants filed a motion to withdraw as counsel for Rocha,
and on September 17, 2012, the district court granted this
motion, stating, “Ms. Johnson has informed Plaintiffs’ Coun‐
sel on behalf of Mr. Rocha, that she does not oppose their
withdrawal from representation of Mr. Rocha.” Also on Sep‐
tember 17, 2012, the Fluegel court dismissed the case with
prejudice for all named plaintiffs except Rocha, whose case
was voluntarily dismissed without prejudice. Defendants
confirmed that Rocha would not have to pay any attorney’s
fees or other expenses.
B. Rocha’s Lawsuits against FedEx in Federal and State
Court
On October 30, 2012, Rocha and Arize 11, represented by
Johnson, filed a 518‐paragraph, 16‐count complaint against
FedEx and numerous FedEx executives, which included al‐
legations of violations of the Racketeer Influenced and Cor‐
rupt Organizations Act (“RICO”), the Sherman and Clayton
Acts, and Illinois law. Rocha eventually amended the com‐
No. 15‐1538 5
plaint to 17 counts. In response, FedEx filed a motion to
dismiss.
The district court dismissed Rocha’s amended complaint
on January 17, 2014, finding it to be “an egregious violation
of Rule 8(a).” Rocha, 15 F. Supp. 3d at 805 (internal quotation
omitted). The dismissal of Rocha’s amended complaint was
without prejudice, and Rocha was granted leave to file an
amended federal complaint if he “can address the funda‐
mental deficiencies set forth in this opinion in no more than
300 clear paragraphs that are not repetitive, speculative, or
conclusory.” Id. at 813. The court suggested, alternatively,
that Rocha “proceed in state court instead of trying to estab‐
lish federal jurisdiction for this dispute where none may ex‐
ist.” Id.
On January 16, 2015, Rocha and Arize 11, represented by
Johnson, filed a complaint in state court against FedEx, alleg‐
ing breach of contract, fraud, promissory estoppel, Illinois
statutory violations, conspiracy to defraud and aiding and
abetting of fraud, unjust enrichment, and conversion. Rocha
v. FedEx Corp., No. 2015‐L‐00506 (Ill. Cir. Ct. filed Jan. 16,
2015). This action is still ongoing.
C. Rocha’s Lawsuit against Defendants
Before filing his state‐court complaint against FedEx, on
June 27, 2014, Rocha brought the present action by way of an
amended complaint against Defendants, claiming breach of
contract, breach of fiduciary duties, fraud, and violation of
the Illinois Consumer Fraud and Deceptive Business Practic‐
es Act (“ICFA”), and legal malpractice. Defendants moved
to dismiss this lawsuit for failure to state a claim, pursuant
to Rule 12(b)(6).
6 No. 15‐1538
Over the next several months, the court held multiple
hearings in which it repeatedly asked Rocha to provide evi‐
dence on what it deemed to be a dispositive issue—to show
that his Fluegel claims against FedEx were not viable at the
time that he substituted Johnson for Defendants as his coun‐
sel.
Rocha failed to make such a showing, and on February
11, 2015, the district court granted Defendants’ motion and
dismissed Rocha’s amended complaint with prejudice. In
doing so, the court found that Rocha had chosen to be ex‐
cluded from the 2012 Fluegel settlement. (Sent. Tr. 9–10, Feb.
11, 2015.)
Then, the court ruled that under Illinois law, “Rocha los‐
es as a matter of law, not of fact. The flaw that I think exists
here is non‐curable, and that is that there is no showing and
no potential showing of a but‐for cause when, as here, the
claims are viable, were viable.” (Id. 13.) The court concluded
by stating that “your claim against FedEx in the State Court
system, … you are entitled to do that … I make no comment
on that.” (Id. 16.) Rocha’s appeal followed.
II. ANALYSIS
“This court reviews a dismissal under Rule 12(b)(6) for
failure to state a claim de novo,” and it “may affirm on any
ground contained in the record.” Brooks v. Ross, 578 F.3d 574,
578 (7th Cir. 2009).
On appeal, Rocha makes a number of scattered factual
and legal arguments. We elect to examine what we under‐
stand to be Rocha’s three primary contentions: that the dis‐
trict court erred by (1) dismissing his legal malpractice claim,
(2) dismissing his fraud claim, and (3) dismissing his
No. 15‐1538 7
amended complaint with prejudice. Because we find these
sufficient to resolve the case, we need not address Rocha’s
other arguments. See id. at 578.
A. Legal Malpractice Claim
To state a claim for legal malpractice under Illinois law, a
plaintiff must plead the following elements: “(1) an attorney‐
client relationship that establishes a duty on the part of the
attorney; (2) a negligent act or omission constituting a breach
of that duty; (3) proximate cause establishing that ‘but for’
the attorney’s malpractice, the plaintiff would have prevailed
in the underlying action; and (4) actual damages.” Mitchell v.
Schain, Fursel & Burney, Ltd., 773 N.E.2d 1192, 1193–94 (Ill.
App. Ct. 2002).
“[I]n assessing the damage inflicted by legal malpractice,
prime consideration must be given to the situation in which
the client was placed at the time of the termination of the le‐
gal services.” Id. at 1194. This is because an attorney’s duty to
his client ceases upon the attorney’s discharge. Land v.
Greenwood, 478 N.E.2d 1203, 1206 (Ill. App. Ct. 1985). If “[t]he
cause of action was viable at the time of [the attorney’s] dis‐
charge,” then a plaintiff suing for legal malpractice “can
prove no set of facts which connect [the attorney’s] conduct
with any damage sustained by plaintiff.” Mitchell, 773
N.E.2d at 1194 (quotation marks omitted).
In this case, if Rocha’s Fluegel claims were viable when he
discharged Defendants, then he cannot establish legal mal‐
practice as a matter of law.
Under Illinois law, if a plaintiff voluntarily dismisses a
claim, “then, whether or not the time limitation for bringing
such action expires during the pendency of such action, the
8 No. 15‐1538
plaintiff … may commence a new action within one year or
within the remaining period of limitation, whichever is
greater.” 735 ILCS 5/13‐217 (West 1994).1 The Illinois Su‐
preme Court has held that “[s]ection 13‐217 operates as a
limitations savings statute, with the purpose of facilitating
the disposition of litigation on the merits and avoiding its
frustration upon grounds unrelated to its merits.” Richter v.
Prairie Farms Dairy, Inc., 2016 IL 119518, ¶ 44 (Ill. 2016). Fur‐
thermore, it has held that “section 13‐217 … [is] remedial in
nature and should be liberally construed in favor of hearing
the plaintiff’s claim.” Bryson v. News Am. Publ’ns, Inc., 672
N.E.2d 1207, 1223 (Ill. 1996).
In the present case, Rocha’s Fluegel claims were still via‐
ble in September 2012, when Defendants were discharged.
As an initial matter, Rocha retained Johnson as counsel before
discharging Defendants in September 2012.2
On September 17, 2012, the Fluegel court voluntarily dis‐
missed Rocha’s claims without prejudice. At that time, Rocha
had already retained Johnson, and he had an absolute right
to refile his Fluegel claims as a new action until, at least, Sep‐
1 “This version of section 13–217 is currently in effect because it preceded
the amendments of Public Act 89–7, § 15 (eff. Mar. 9, 1995), which this
court found unconstitutional in its entirety in Best v. Taylor Machine
Works, 689 N.E.2d 1057 (Ill. 1997).” Richter v. Prairie Farms Dairy, Inc.,
2016 IL 119518, ¶ 44 n.1 (Ill. 2016).
2 Johnson filed a notice of appearance as counsel for Rocha on September
10, 2012. Defendants filed a motion to withdraw as counsel for Rocha on
September 14, 2012, and the district court granted Defendants’ motion to
withdraw on September 17, 2012.
No. 15‐1538 9
tember 2013, one year after the voluntary dismissal.3 Rocha
exercised that right on October 30, 2012, by including his
Fluegel claims in his voluminous 16‐count complaint against
FedEx.
Because Rocha’s Fluegel claims were still viable when De‐
fendants were discharged as his counsel, he cannot establish
legal malpractice as a matter of law. See Mitchell, 773 N.E.2d
at 1195 (applying section 13‐217 to determine that “plaintiff’s
cause of action was viable, as a matter of law, well after [pri‐
or counsel] were discharged and successor counsel was re‐
tained”).
B. Fraud Claim
Rocha also argues that his fraud claim was improperly
dismissed. From the record, it appears that the district court
did not explicitly discuss Rocha’s fraud claim. Therefore, we
address it now on de novo review. See Brooks, 578 F.3d at 578
(affirming a dismissal under 12(b)(6) after examining a stat‐
ute of limitations argument raised on appeal that the “dis‐
trict court did not explicitly address”).
In his amended complaint, Rocha makes the following al‐
legations of fraud against Defendants: (1) failure to disclose
a promise by FedEx to pay “unrecoverable fees in exchange
3 Rocha contends that his Fluegel claims include claims that the Defend‐
ants should have, but did not, assert in Fluegel, including common law
fraud, breach of contract, and promissory estoppel. However, these unal‐
leged claims were also viable under section 13‐217 because they arose
from the “same transaction” as the alleged claims in Fluegel. See Richter,
2016 IL 119518, ¶ 48 (allowing new claims in a refiled action under sec‐
tion 13‐217 that arose from the “same transaction” alleged in the prior
action).
10 No. 15‐1538
for releases from a sufficient number of contractors” during
July 2010 and July 2011 communications with Rocha; (2)
failure to disclose the “amounts [they] would be paid under
the final settlement agreement” in Fluegel; (3) misrepresenta‐
tion of the “basis for [the] allocation of settlement amounts
and fees” in the settlement in Fluegel; (4) misrepresentation
and concealment of the “terms of the settlement” in Fluegel;
and (5) concealment of the “terms of the documents” pre‐
sented to the Fluegel court for approval. (Am. Compl. ¶ 113.)
“In alleging fraud … a party must state with particularity
the circumstances constituting fraud.” Fed. R. Civ. P. 9(b).
This court has held that under the Rule 9(b) particularity re‐
quirement, plaintiffs must plead the “who, what, when,
where, and how: the first paragraph of any newspaper sto‐
ry” of the alleged fraud. United States ex rel. Lusby v. Rolls‐
Royce Corp., 570 F.3d 849, 853 (7th Cir. 2009) (internal quota‐
tion marks omitted). This requirement includes “the identity
of the person making the misrepresentation, the time, place,
and content of the misrepresentation, and the method by
which the misrepresentation was communicated to the
plaintiff.” Uni*Quality Inc. v. Infotronx, Inc., 974 F.2d 918, 923
(7th Cir. 1992) (internal quotation marks omitted).
Additionally, because fair notice is the “most basic con‐
sideration underlying Rule 9(b),” in a case involving multi‐
ple defendants, “the complaint should inform each defend‐
ant of the nature of his alleged participation in the fraud.”
Vicom, Inc. v. Harbridge Merch. Servs., 20 F.3d 771, 777–78 (7th
Cir. 1994) (citations and internal quotation marks omitted).
In the instant case, we find that Rocha’s fraud claim, as
pleaded in his amended complaint, must be dismissed be‐
cause his allegations fall far short of the heightened pleading
No. 15‐1538 11
standards required under Rule 9(b). For each of his allega‐
tions, Rocha fails to provide the specific names, dates, times,
or content of the misrepresentations or omissions that give
rise to the alleged fraud. Furthermore, even though his suit
is against multiple Defendants, Rocha also fails to provide
fair notice to each individual Defendant concerning the na‐
ture of his or her alleged participation in the fraud. In the
context of fraud, this court has previously “rejected com‐
plaints that have ‘lumped together’ multiple defendants,”
and we do so again here. Id. at 778.
This, however, does not end our discussion. Rocha ar‐
gues that he had attempted to cure the pleading defects in
his fraud claim by moving for leave to file a second amend‐
ed complaint, which the district court denied as moot. (Ro‐
cha Reply Br. 3). For completeness, we proceed and examine
Rocha’s fraud claims in his proposed second amended com‐
plaint, which is included in the record. We conclude that
these allegations cannot survive a motion to dismiss. Even if
these allegations were able to satisfy the pleading require‐
ments for fraud under Rule 9(b), they still fail to “state a
claim to relief that is plausible on its face.” Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007) (internal quotation marks omitted)).
Regarding whether a complaint states a plausible claim
of relief, the Supreme Court has articulated a two‐pronged
approach in which a court: (1) first identifies the well‐
pleaded factual allegations by discarding the pleadings that
are “no more than conclusions” and (2) then determines
whether the remaining well‐pleaded factual allegations
“plausibly give rise to an entitlement to relief.” Iqbal, 556
U.S. at 679.
12 No. 15‐1538
Here, after discarding all conclusory statements of
wrongdoing, it appears that Rocha’s proposed second
amended complaint merely alleges the following: that De‐
fendants engaged in fraud during communication with Ro‐
cha between June and August 2012 regarding the terms of
the Fluegel settlement. (Pl.’s Proposed Second Am. Compl.
¶¶ 140–53.) Not only do Rocha’s claims fail to “plausibly
give rise to an entitlement to relief,” but they are completely
undercut by his own pleadings and exhibits, which establish
Defendants’ honest and clear presentation of the settlement
terms, including FedEx’s requirement for release of all
claims by individuals and associated corporations. (Id.
¶¶ 140–53, Exs. A, B, C, D, E, G, H).
Accordingly, Rocha’s fraud claims must be dismissed.
C. Dismissal with Prejudice
Lastly, Rocha contends that the district court erred by
dismissing his amended complaint with prejudice, instead of
dismissing without prejudice for lack of subject matter juris‐
diction. We disagree.
Rocha mischaracterizes why the district court dismissed
his claim—it was for failure to state a claim, not lack of sub‐
ject matter jurisdiction. Regarding a district court’s dismissal
of a complaint for failure to state a claim, the Supreme Court
has unambiguously held the following:
Jurisdiction, therefore, is not defeated … by the
possibility that the averments might fail to state a
cause of action on which petitioners could actually
recover. For it is well settled that the failure to state
a proper cause of action calls for a judgment on the
merits and not for a dismissal for want of jurisdic‐
No. 15‐1538 13
tion. Whether the complaint states a cause of action
on which relief could be granted is a question of
law and just as issues of fact it must be decided af‐
ter and not before the court has assumed jurisdic‐
tion over the controversy. If the court does later ex‐
ercise its jurisdiction to determine that the allega‐
tions in the complaint do not state a ground for re‐
lief, then dismissal of the case would be on the mer‐
its, not for want of jurisdiction.
Bell v. Hood, 327 U.S. 678, 682 (1946).
In the present case, the district court correctly ruled that
Rocha could not establish a legal malpractice claim as a mat‐
ter of law because his Fluegel claims were still viable after he
discharged Defendants as his counsel. This constitutes a de‐
termination on the merits. The district court gave Rocha am‐
ple opportunity over several months—through supple‐
mental briefings and multiple hearings—to develop his
claims before making its ruling.
Furthermore, our analysis of Rocha’s fraud claim also
constitutes a determination on the merits. Neither Rocha’s
amended complaint, nor his proposed second amended
complaint could meet the requisite pleading standards. His
own pleadings and attached exhibits defeat any plausible
claim of fraud.
Therefore, the district court dismissal of Rocha’s amend‐
ed complaint with prejudice was proper.
III. CONCLUSION
For the foregoing reasons, the judgment of the district
court is AFFIRMED.