District judge Phil Gilbert dismissed an inmate’s consumer fraud complaint for lack of jurisdiction, which alleged defective Haines t-shirts lose their shape after becoming stretched out.
Gilbert dismissed the suit on April 9 after concluding that plaintiff Firas Ayoubi failed to allege facts sufficient to plausibly suggest that the amount in controversy exceeds $75,000.
Gilbert wrote that Ayoubi’s amended complaint sought actual economic injuries for the price he paid for the products at issue, tort damages for fraud and deceptive business practices, and punitive damages of $5,000 per count against each defendant.
“Careful examination shows, however, that Ayoubi is wrong,” Gilbert wrote. “The maximum actual economic injury under a contract/quasi-contract theory suffered by Ayoubi was likely no more than around $380.
“Where there is no suggestion the products resulted in physical injury to Ayoubi, damage to his personal property, or consequential damages, and where the only tort injury alleged is consumer fraud from deception that resulted in his loss of about $380 at the most, damages under a fraud theory are likely to be the same.”
Gilbert added that even if an award for punitive damages was warranted, it would not be large enough to satisfy the required $75,000 threshold.
“Here, a punitive damages award would have to be more than $74,000 – an award greater than 196 times the $380 compensatory damages at issue – to get Ayoubi’s total countable damages over the jurisdictional threshold. Considering the defendants’ alleged consumer fraud – relatively run-of-the-mill consumer fraud in selling subpar apparel to vulnerable consumers – a punitive damages award of more than $74,000 is unthinkable,” Gilbert wrote.
Ayoubi also claimed the amount would be satisfied after adding new defective products following discovery and after seeking class certification.
However, Gilbert held that he cannot base his jurisdictional assessment on “such speculative future occurrences.”
Gilbert also concluded that Ayoubi’s complaint included defective pleadings regarding citizenship.
In Ayoubi’s original complaint, he failed to clarify if he claimed to be an Illinois citizen because it’s his state of incarceration or because he was an Illinois citizen before he was sent to prison and had no plans to live elsewhere upon his release. He also failed to specifically allege the state of principal place of business or state of incorporation for defendants Hanesbrands Inc. and Access Catalogue Company and failed to allege the citizenships of every member of defendant Keefe Group LLC.
Ayoubi filed an amended complaint attempting to correct the citizenship issues after Gilbert ordered him to show cause on Feb. 15.
However, Gilbert concluded that the plaintiff “is not completely successful in his efforts.”
Ayoubi’s amended complaint again failed to explain the basis for his claim to be an Illinois citizen. He also again failed to allege the state of the principal place of business or incorporation for Hanesbrands and Access Catalogue.
Ayoubi also attempted to list the citizenships of the Keefe Group members, but Gilbert wrote that the companies appear to be affiliates but not necessarily members.
It is also unclear whether the members are corporations, Gilbert held. Corporations would have citizenships of their principal places of businesses and states of incorporation. They could also include entities such as limited liability companies, partnerships or voluntary associations, which would have the citizenships of their members.
“In sum, Ayoubi’s amended complaint fails to cure all the citizenship pleading defects noted in the court’s order to show cause,” Gilbert wrote.
“Ordinarily the court would allow Ayoubi another chance to correct his defective pleading of the parties’ citizenships – he is, after all pro se – yet the court believes he will be utterly unable to add allegations plausibly raising his damages claim to the $75,000 jurisdictional threshold. Thus, it would be futile to allow him to amend the complaint when he could not possible allege facts plausibly suggesting an adequate amount in controversy,” Gilbert added.
Ayoubi also attempted to add Fila Sporting Goods Company as a new defendant in his amended complaint. He alleged the defendant sold defective shoes to Keefe Group and Access Catalogue, which then sold four of those pairs of defective shoes at a cost of $40 apiece to the plaintiff while he was incarcerated at Dixon Correctional Center.
Gilbert held that leave of court is required before a plaintiff can add new parties to a case, but Ayoubi was only authorized to correct jurisdictional defects.
Ayoubi filed his original complaint on Oct. 4, 2018.
In his complaint, Ayoubi claimed he was transferred to the Pinckneyville Correctional Center in January 2018, which provides commission for inmate that allows them to buy various items, such as food, clothing and hygiene products. Included in the clothing items for purchase is a Hanes t-shirt product, which consists of three white, tag-less t-shirts.
The suit stated that the t-shirts are sealed in original Hanes packaging and trademarked as "preshrunk cotton" and "cool comfort fabric."
Ayoubi alleged the packaging boasted that the shirts would not lose their shape and had a "perfect fit." However, the plaintiff claims that after washing the shirts, the shirt stretched, the collar lost its shape and the sleeve seems became defective.
"The package's markings were not consistent with the true nature and performance of the product," the suit stated.
The plaintiff alleged Keefe/Access sells the shirts to Pinckneyville Correctional Center at a high cost, which ends up being sold to inmates for $16 for the pack. The suit alleges the price for inmates is more than what they are sold to the general public.
"Hanes knew of their products defective design and factor reject nature and formulated a deal with Keefe/Access to sell the product anyway for the purpose of targeting it to inmate and prison populations," the suit stated.
Ayoubi claimed he continued buying the product in hopes of getting a "good batch and assumed it was an isolated incident."
"Defendants made profit off of plaintiffs detriment," the suit stated. "Being a consumer and having the right to know about the true nature of their product and his status as a prisoner and not having many choices."
U.S. District Court for the Southern District of Illinois case number 3:18-cv-1806