Webb Katharine V Playmonster Group Llc

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN

KATHARINE E. WEBB,

Plaintiff,
OPINION and ORDER
v.

25-cv-231-jdp
PLAYMONSTER GROUP, LLC,

Defendant.

This court previously granted default judgment to plaintiff Katharine Webb on claims
that Playmonster LLC (Webb’s former employer) fired her because she was pregnant and
because it did not want to give her medical leave, in violation of Title VII of the Civil Rights
Act of 1964 and the Family and Medical Leave Act (FMLA). The court awarded Webb
approximately $173,000 in damages, attorney fees, and costs. See Webb v. Playmonster LLC,
No. 23-cv-442-jdp, 2024 WL 1675062 (W.D. Wis. Apr. 18, 2024). Now Webb is suing a
different entity, Playmonster Group LLC, and she seeks to enforce the default judgment against
the new defendant under a theory of successor liability, alleging that Playmonster Group
acquired Playmonster LLC’s assets, continued it operations, and employed most of the same
people.1
Playmonster Group moves to dismiss, contending that there is no federal cause of action
for successor liability, so the court does not have subject matter jurisdiction, and the complaint

1 The original defendant in case no. 23-cv-442-jdp was Playmonster Group, LLC, but Webb
amended her complaint to substitute Playmonster LLC, stating that “[t]he Defendant advised
Plaintiff of the incorrect party and the need for the correction from Playmonster, Group, LLC
to Playmonster LLC.” Case no. 23-cv-442-jdp, Dkt. 7, at 2. Neither party contends that the
alleged advice Webb received is relevant to the motion to dismiss, so the court will not consider
that issue.
also fails to state a claim upon which relief may be granted. The court has jurisdiction regardless
of any federal claims in this case because Webb has alleged the requirements for diversity
jurisdiction under 28 U.S.C. § 1332. But the court agrees with Playmonster Group that federal
law does not recognize an independent cause of action for enforcing a judgment under Title

VII or the FLMA against a successor in interest. A successor can be sued under Title VII and
the FMLA, but the plaintiff must prove the elements of those claims against the successor. This
may seem unfair, but controlling precedent on this issue leaves no room for debate. Wisconsin
common law may recognize a cause of action for enforcing a judgment against a successor, but
Webb does not contend that she can meet the requirements for a state-law claim.
The court will dismiss the complaint for failure to state a claim. But Webb may amend
her complaint to either assert a state-law cause of action for successor liability or to sue
Playmonster Group for violating Title VII and the FMLA.

ANALYSIS
Playmonster Group’s motion to dismiss raises two issues: (1) does the court have
jurisdiction over the case? and (2) does Webb state a claim under federal or state law for
successor liability. The court will address each issue in turn.
A. Subject matter jurisdiction
Webb asserts two bases for subject matter jurisdiction in her complaint: (1) Section
1331, which applies to cases “arising under” federal law; and (2) Section 1332, which applies
when the parties are citizens of different states and the amount in controversy is more than

$75,000. For the reasons discussed in the next section, the court agrees with Playmonster
Group that Webb’s claims do not arise under federal law, so the court cannot exercise
jurisdiction under § 1331.
But Playmonster Group simply ignores Webb’s alternative basis for exercising
jurisdiction under § 1332. At the pleading stage, it is enough if the plaintiff has plausible

allegations that the jurisdictional requirements are satisfied. Silha v. ACT, Inc., 807 F.3d 169,
173 74 (7th Cir. 2015).
As for diversity of citizenship, Webb alleges that she is a citizen of Illinois, Dkt. 1, ¶ 7;
and she alleges that Playmonster Group is a limited liability company whose sole member is a
citizen of Massachusetts, id. ¶ 5. See Cosgrove v. Bartolotta, 150 F.3d 729, 731 (7th Cir. 1998)
(citizenship of limited liability company is the citizenship of its members). So Webb has alleged
diversity of citizenship.
As for the amount in controversy, the judgment Webb seeks to enforce was for

approximately $173,000. The complaint does not say whether Webb has recovered any portion
of the judgment from Playmonster LLC. But Webb alleges that Playmonster Group acquired
all of Playmonster LLC’s assets and that Playmonster LLC cannot satisfy the judgment, Dkt. 1,
¶¶ 17, 24, so it is reasonable to infer that more than $75,0000 is in controversy.
It is plausible to infer from Webb’s allegations that the court can exercise jurisdiction
under § 1332, so the court will not dismiss the case for lack of jurisdiction.
B. Claim for successor liability

The remaining question is whether Webb states a claim under federal or state law for
successor liability. As for federal law, there is a threshold question whether federal law gives
her a right to sue. Federal common law alone is not enough to create a cause of action for
successor liability; the plaintiff must point to a federal statute or an implied cause of action
that gives her the right to sue. E. Cent. Illinois Pipe Trades Health & Welfare Fund v. Prather
Plumbing & Heating, Inc., 3 F.4th 954, 956, 961 (7th Cir. 2021). Webb contends that the FMLA
and Title VII create causes of action for successor liability. The court will consider both
statutes, along with a potential claim under state law.

1. The FMLA
As for the FMLA, Webb contends that two provisions collectively give her the right to
enforce her prior judgment against a successor. First, she cites 29 U.S.C. § 2617(a)(2), which
states that “any employer who violates § 2615 of [the FMLA] shall be liable to any eligible
employee for damages.” Second, she cites 29 U.S.C. § 2611(4)(A), which defines “employer”
to include successors in interest of an employer.
The cited provisions do not help Webb. They allow an employee to sue a successor in

interest for violations of the FMLA. They do not allow a plaintiff to enforce a judgment against
a successor. The importance of that distinction was explained in Prather Plumbing & Heating, 3
F.4th 954. The plaintiffs in that case were attempting to enforce a judgment under the
Employee Retirement Income Security Act (ERISA) against a successor in interest. The
plaintiffs relied on 29 U.S.C. § 1132, which is ERISA’s general enforcement provision. But that
provision was not sufficient because the plaintiffs were not suing the successor for violating a
substantive provision in ERISA. The plaintiffs needed a provision that “authorize[d] a lawsuit
to hold a successor liable for a prior ERISA judgment,” Prather Plumbing & Heating, 3 F.4th at

961, but ERISA does not contain such a provision. The court acknowledged that it had
“recognized the successor doctrine as a means of holding one party liable when the lawsuit
contains some independent federal cause of action.” Id. But the court was “aware of no case . . .
recognizing a standalone federal right of action to collect an ERISA judgment against an alleged
successor, and [the court] decline[d] to create a private right of action where the statute has
not.” Id.
Prather Plumbing & Heating controls this case. Like ERISA, the FMLA does not include
a provision authorizing a cause of action to enforce a judgment against a successor in interest.

It is true that the FMLA includes a provision allowing successors to be sued. But that provision
is simply a codification of the federal common law rule recognized in Prather Plumbing & Heating
allowing successors to be sued for the predecessor’s statutory violations. Webb is not asserting
a claim that Playmonster Group violated a substantive provision of the FMLA, so she cannot
rely on § 2617(a)(2) and § 2611(4)(A).
Webb ignores Prather Plumbing & Heating in her brief, even though that case is a focus
of Playmonster Group’s brief. Webb relies instead on Anderson v. Abbott, 321 U.S. 349 (1944),
but that case is not instructive. In Anderson a receiver sued a bank’s shareholders to hold them

liable for a judgment against the bank. The Supreme Court allowed that, not because of
successor liability or similar doctrine, but because “a federal law, 12 U.S.C. §§ 63,
64 . . . specifically made shareholders of an undercapitalized federal bank liable up to the par
value of their stock, regardless of the amount actually invested.” Peacock v. Thomas, 516 U.S.
349, 354 (1996) (discussing Anderson). In other words, the plaintiffs in Anderson relied on a
statute that expressly authorized their claim. As already explained, Webb does not cite a
comparable FMLA provision, so the court will dismiss Webb’s successor liability claim under
the FMLA.

2. Title VII
Webb does not cite any statutory provisions in Title VII that authorize a cause of action
for successor liability. Instead, she cites Musikiwamba v. ESSI, Inc., 760 F.2d 740 (7th Cir.
1985), in which the court held that an employee could sue an employer’s successor in interest
for Title VII violations under certain situations. But Musikiwamba is simply a federal common
law version of the successor liability doctrine recognized by statute in the FMLA. Prather
Plumbing & Heating forecloses any argument that federal common law creates a cause of action

to enforce judgments against successors in interest. The court stated: “All told, it does not
matter that this dispute involves the application of a federal common law doctrine and
indirectly concerns obligations under ERISA.” 3 F.4th at 962. Rather, the plaintiff must
identify a federal statute or an implied cause of action. Id. Webb has not done that, so the
court must also dismiss Webb’s claim for successor liability under Title VII.
3. State law
This leaves the question whether Webb could sue Playmonster Group for successor

liability under Wisconsin law, which may recognize claims for successor liability in a narrow
set of circumstances. See Veritas Steel, LLC v. Lunda Construction Company, 2020 WI 3, ¶ 18,
389 Wis. 2d 722, 937 N.W.2d 19.2 But Webb did not assert a state-law successor liability
claim in her complaint, even though she asks the court to exercise diversity jurisdiction under
§ 1332. In fact, Webb implies that she cannot meet the requirements for successor liability
under state law, stating that the test under Wisconsin law is more onerous than federal law.
Dkt. 14, at 9. As one example, Webb cites the requirement that there be a common identity
of officers, directors and stockholders between the two companies. Veritas Steel, 2020 WI 3, at

¶ 31.

2 Neither party conducts a choice-of-law analysis, but Webb assumes, and Playmonster Group
does not dispute, that Wisconsin law would apply to a state-law successor liability claim. See
FutureSource LLC v. Reuters Ltd., 312 F.3d 281, 283 (7th Cir. 2002) (“[T]here’s no discussion
of choice of law issues, and so we apply the law of the forum state.”).
Regardless of whether Webb believes she can satisfy the state-law test, she has neither
included allegations in her complaint under that test nor explained in her brief why she satisfies
the test. So the court cannot allow Webb to proceed on a state-law claim.
C. Conclusion

The court must dismiss the complaint because Webb has not identified a federal cause
of action for successor liability, and she has not stated a claim under state law. But the general
rule is that the court should give the plaintiff an opportunity to amend her complaint before
the court enters judgment. L. Offs. of David Freydin, P.C. v. Chamara, 24 F.4th 1122, 1133 (7th
Cir. 2022). In this case, it would be futile for Webb to reassert federal claims for successor
liability. But it is possible that Webb could state a claim for successor liability under state law,
or she could assert claims for violations of Title VII and the FMLA, as she did in her previous

case. The court does not determine in this order whether such a claim would be untimely or
otherwise precluded or if Playmonster Group could be estopped from asserting such defenses
because it misled Webb into suing the wrong entity in the previous lawsuit.
ORDER
IT IS ORDERED that:
1. Defendant Playmonster Group, LLC’s motion to dismiss, Dkt. 11, is GRANTED,
and the complaint is DISMISSED for failure to state a claim.
2. Plaintiff Katharine E. Webb may have until August 12, 2025, to file an amended
complaint. If she fails to respond by then, the clerk of court is directed to enter
judgment in Playmonster Group’s favor and close this case.
Entered July 22, 2025.
BY THE COURT:

/s/
________________________________________
JAMES D. PETERSON
District Judge