McHan v. Grandbouche

99 F.R.D. 260, 36 Fed. R. Serv. 2d 1227, 1983 U.S. Dist. LEXIS 18160
CourtDistrict Court, D. Kansas
DecidedMarch 29, 1983
DocketNo. 79-4257
StatusPublished
Cited by18 cases

This text of 99 F.R.D. 260 (McHan v. Grandbouche) is published on Counsel Stack Legal Research, covering District Court, D. Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
McHan v. Grandbouche, 99 F.R.D. 260, 36 Fed. R. Serv. 2d 1227, 1983 U.S. Dist. LEXIS 18160 (D. Kan. 1983).

Opinion

MEMORANDUM AND ORDER

ROGERS, District Judge.

This is a diversity action in which plain- ' tiff claims that he was defrauded by the defendants. This matter is presently before the court upon the following motions: (1) plaintiff’s motion for class action certification (Doc. # 67); (2) defendants’ motion for a more definite statement (Doc. # 72); and (3) plaintiff’s motion for sanctions (Doc. # 76). The court has heard oral argument on these motions and is now prepared to rule. In addition, the court shall consider whether defendant John Grandbouche should be held in contempt for failure to comply with this court’s order of March 24, 1981. Further, the court shall consider defendant John Grandbouche’s motion for review (Doc. # 135).

[262]*262We shall first consider plaintiff’s motion for class action certification. The requirements for class action certification are contained in F.R.Civ.P. 23. Before a suit may proceed as a class action, it must be shown that all four prerequisites contained in Rule..23(a) have been met and that at least one of the subdivisions of Rule 23(b) has been satisfied. Peterson v. Oklahoma City Housing Authority, 545 F.2d 1270, 1273 (10th Cir.1976); Albertson’s Inc. v. Amalgamated Sugar Co., 503 F.2d 459, 463 (10th Cir.1974). The burden is, of course, always upon the party seeking class action certification to demonstrate, under a strict burden of proof, that their request for class action status should be granted. Rex v. Owens, 585 F.2d 432, 435 (10th Cir.1978); Redhouse v. Quality Ford Sales, Inc., 511 F.2d 230, 236 (10th Cir.1975).

The Tenth Circuit has held that “if there is to be error made, let it be in favor and not against the maintenance of the class action.” Esplin v. Hirschi, 402 F.2d 94, 99 (10th Cir.1968), cert. denied, 394 U.S. 928, 89 S.Ct. 1194, 22 L.Ed.2d 459 (1969). However, this statement should not be read to unduly limit discretion of the trial judge in class certification matters, since discretion may well be the “key to a realistic administration of Rule 23 particularly with respect to a determination of the most fair and efficient procedure.” Wilcox v. Commerce Bank of Kansas City, 474 F.2d 336, 344 (10th Cir.1973). In making the determination whether a class action is appropriate, it is generally held that the probability of success on the merits is irrelevant and should not be considered. Eisen v. Carlisle & Jacquelin, 417 U.S. 156, 177-178, 94 S.Ct. 2140, 2152-2153, 40 L.Ed.2d 732 (1974). With these basic legal principles of Rule 23 in mind, the court shall turn to the factual and procedural background of this action.

This case was filed by plaintiff on December 26, 1979. An amended complaint was filed on January 2, 1980. The essence of plaintiff’s complaint is contained in the preliminary statement to his complaint wherein it is stated:

This is a diversity action by a Kansas citizen who was defrauded by Defendants pursuant to a wrongful and unlawful interstate scheme whereby Defendants purport to offer legal advice and services while disavowing that they are attorneys, upon the pretense that Defendants can counsel, advise, suggest, instruct, and otherwise prepare American taxpayers, including Plaintiff, in such a way as to relieve Plaintiff and others similarly situated from the duty to file income tax returns, and from the legal consequences of any income tax violation charges which might be brought by the federal authorities; and that Defendants would counsel Plaintiff in a promised successful defense of pending criminal charges in this Court; all upon the pretended grounds (according to Defendants) that the Constitution of the United States and the Bill of Rights thereto forbids the enforcing of income tax payments upon the citizens of this country except in times of war and for four (4) years thereafter, and that this Court had no jurisdiction in the pending criminal action against Plaintiff. Defendants are engaged in a very large, unlawful and lucrative conspiracy whereby Defendants prey upon those who find themselves in difficulty with the federal taxing authorities, bilking said persons of huge sums of money. This Plaintiff was thus victimized by Defendants. If the Court deems class action treatment an appropriate vehicle for doing justice herein, Plaintiff will fairly and adequately represent those similarly victimized by Defendants. '

Specifically, plaintiff alleges the following regarding his individual claim in his amended complaint: On December 4, 1979, plaintiff, along with nineteen other fellow employees of Daniel International at the Wolf Creek power plant near New Strawn, Kansas, was charged by the government with violating 26 U.S.C. § 7205. Further, the United States Attorney let it be known that his office was investigating potential similar charges against other employees at the project. These happenings were widely reported by the media. Defendants learned [263]*263of these activities and contacted the clerk of the court in an effort to discover plaintiff’s address and telephone number. After obtaining plaintiff’s telephone number, defendants contacted the plaintiff. Thereafter, defendants John Grandbouche and Rex S. “Barry” Taylor, by prearrangement, met with the plaintiff and approximately eighty others from the Wolf Creek project at Emporia, Kansas, to further develop their scheme in this case. This meeting took place on December 8, 1979. At that meeting, defendants told plaintiff that if he would provide them with money and collect money from others for them, they would prepare plaintiff so he would not have to pay income taxes or even file income tax returns. Defendants further promised plaintiff that in return for his money that he and those similarly situated could avoid the need for attorneys and could prevail by following the advice of the defendants. Defendants further indicated that they had successfully defended other cases similar to plaintiff’s case and his co-workers at the Wolf Creek project and that they had “never lost a case.” Defendants further told plaintiff and his fellow employees that they had not filed a federal income tax return for five or six years. Plaintiff contends that such promises and representations were false, were known to be false by defendants when made, and were made by the defendants for the purpose of inducing plaintiff to rely on them. Thereafter, plaintiff did rely on these representations by paying money to the defendants and collecting money for them. On December 18, 1979, before Magistrate Crow, plaintiff thought better of his predicament and decided to seek legal counsel, and thereupon learned of the fraud of the defendants. Plaintiff alleges he has sustained actual damages in excess of $10,000.00, and further requests punitive damages in excess of $10,000.00.

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Bluebook (online)
99 F.R.D. 260, 36 Fed. R. Serv. 2d 1227, 1983 U.S. Dist. LEXIS 18160, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mchan-v-grandbouche-ksd-1983.