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Cordova v. City of Chicago (In re Emelida Cordova)

19bk06255, 19ap00684
Upon the motion to dismiss the plaintiffs’ complaint, brought by the defendant for failure to state a claim upon which relief can be granted under Federal Rule of Civil Procedure 12(b)(6), held:  the motion to dismiss is largely predicated on the belief that the Supreme Court’s ruling in City of Chicago v. Fulton, — U.S. —, 141 S. Ct. 585 (2020), forecloses the plaintiffs’ claims for violation of the automatic stay under sections 362(a)(4), (6) and (7) of the Bankruptcy Code.  Fultonwas, however, expressly limited to section 362(a)(3) of the Bankruptcy Code.  As a result, Fulton does not directly foreclose claims under sections 362(a)(4), (6) and (7) and the court declines to extend Fulton as requested by the defendant.

As to the sufficiency of the counts pled, the plaintiffs have sufficiently alleged violation of sections 362(a)(4), (6) and 542(a), but have failed to do so with respect to section 362(a)(7).  As a result, the plaintiffs’ claim under section 362(a)(7) will be dismissed as insufficiently pled but without prejudice and with leave to amend, while claims under sections 362(a)(4), (6) and 542(a) survive the motion.

The motion to dismiss also raises the propriety of imposing punitive damages against a municipality.  In this regard, the motion is well taken and the plaintiffs’ request for punitive damages is dismissed.  Section 106(a)(3) of the Bankruptcy Code governs, and the abrogation of sovereign immunity contained therein expressly omits immunity from punitive damages.  The motion to dismiss will be granted in this respect.

Finally, the defendant seeks to dismiss the plaintiffs’ request for class certification.  Class certification is a matter of consideration in a separate motion and not properly the subject of a motion to dismiss.  The defendant’s motion to dismiss is thus denied in this respect.  The court will set a separate deadline for a motion to certify the class and any opposition thereto.

The defendant’s motion to dismiss is, therefore, GRANTED IN PART AND DENIED IN PART.

Monday, December 6, 2021