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MARYONOVICH v. MARKET DATA RETRIEVAL

June 26, 1989

THERESA MARYONOVICH, Plaintiff,
v.
MARKET DATA RETRIEVAL, INC., MDR LIQUIDATING CORPORATION, and HERBERT LOBSENZ, Defendants


James B. Moran, United States District Judge.


The opinion of the court was delivered by: MORAN

JAMES B. MORAN, UNITED STATES DISTRICT JUDGE

 Plaintiff, a former executive secretary at National Business Lists ("NBL"), brings this action against Market Data Retrieval ("MDR") (NBL's successor), MDR Liquidating Corporation, and its former president. In her complaint plaintiff seeks damages for wrongful denial of severance pay benefits (count I), breach of fiduciary duties (count II) and failure to provide documents in violation of federal law (count III). Federal jurisdiction is predicated on the Employee Retirement Income Act of 1974 (ERISA), 29 U.S.C. ยง 1001 et seq.

 Currently before the court are cross-motions for summary judgment on count I and defendants' motion to dismiss counts II and III. For the following reasons, we deny all motions.

 NBL and MDR were both in the business of compiling and selling mailing lists. Plaintiff began working for NBL on January 20, 1969, and continued in its employ for approximately 15 years as an executive secretary to NBL's president, Leo Ganz.

 In 1984 NBL started down a staggered path to dissolution. MDR's president, Herbert Lobsenz, entered into negotiations for the purchase of NBL, and in June 1984 NBL Acquisition Corporation, a wholly-owned subsidiary of MDR, purchased almost all of NBL's stock. Soon thereafter NBL Acquisitions Corporation and NBL merged. The newly-formed NBL remained a subsidiary of MDR, although it is unclear to what extent it retained a separate existence. For example, at some point after the sale employee paychecks were paid out of MDR's bank account and the business telephones were answered "NBL-MDR," rather than "NBL."

 On June 10, 1986, MDR entered into a purchase agreement to sell substantially all of its assets to Dun & Bradstreet ("D&B"). The proceeds from the sale were placed in MDR Liquidating Corporation, which was later converted to its successor, MDR Liquidating Trust.

 Plaintiff continued to work as Ganz's secretary for approximately six months after the sale of NBL's stock to MDR. When Ganz ceased working plaintiff worked as an executive secretary for MDR at the same salary, although the parties dispute whether the benefits remained substantially the same (pl. stmt. of mat. facts at 3, n.2). The parties also dispute whether plaintiff's responsibilities remained the same as they were prior to the sale of NBL to MDR. Plaintiff contends that with MDR, and certainly later with D&B, she ceased working as an executive secretary for the president of the company and began working for a variety of people in capacities for which she was over-qualified. After the sale to D&B she reported for work at a new address once, merely to protest her new assignment and to see whether she would be placed in a position to her liking. On October 27, 1986, she ceased working because matters had not improved.

 Plaintiff subsequently applied for unemployment benefits. A claims adjudicator of the Illinois Department of Labor denied her claim, finding that she had voluntarily quit her job with MDR without cause. This decision was based on written submissions by plaintiff and defendant, and no evidentiary hearing was held. Plaintiff later failed to appear at an appeal of this denial. *fn1"

 NBL had a tradition of providing a number of its valued long-term employees with pensions or severance pay upon termination of their employment. Although there was no written NBL policy on these matters prior to its sale to MDR, Ganz had a practice of rewarding some retiring or departing employees with pensions based upon their length of service and devotion to NBL (Ganz dep. at 71-74). This concern for NBL employees was present during the negotiations for sale of NBL to MDR. Ganz contacted the personnel director at NBL to obtain a list of all employees who had served more than five years (Ganz dep. at 32). After some negotiations with Lobsenz, Ganz inserted into the purchase agreement a provision of rights to a lifetime pension and severance pay for a select group of NBL employees *fn2" (Lobsenz dep. at 89).

 The severance pay policies provide normal severance pay to anyone employed with NBL for more than two years who is "terminated for normal business reasons." The policies also provide special benefits to three named employees -- plaintiff included -- if "terminated within five years after date of sale." It provides for normal severance pay plus a "lifetime pension" at "20% of her highest annual salary earned while working for NBL" if she is "terminated for any reason except cause" (cplt., exh.1). The plan does not further define the term "terminated." *fn3" Ganz states that he informed his employees of this policy. It is undisputed that MDR did not provide plaintiff with a copy, a summary or any other documents regarding this policy prior to the present litigation.

 On April 24, 1987, counsel for plaintiff wrote Lobsenz requesting severance pay pursuant to the policy, asserting that the sale of the company constituted a termination of plaintiff's employment. *fn4" the letter states, in clear terms, that the law firm represents plaintiff in her claim for benefits; it describes the facts under which she believes she is entitled to payment and requests arrangement for payment.

 Defendants' actions after receiving this letter are somewhat confusing. Lobsenz stated in his deposition that MDR had an informal claims procedure, yet it is evident from his testimony that MDR had no claims procedure at all, either initially or for review of claim denials. Indeed, Lobsenz refused to recognize counsel's letter as a claim for severance pay, and when pressed to admit that at some point plaintiff's claim was denied, he refused to take responsibility for the decision. The relevant deposition testimony is too lengthy to reproduce here in its entirety. See generally Lobsenz dep. at 74-82. However, some excerpts provide the tenor of Lobsenz's testimony during those proceedings:

 
Q. Who made the decision on behalf of MDR or MDR Liquidating Corporation whether to provide [plaintiff] with the benefits?
 
A. Which claim for severance benefits are you talking about?
 
Q. Well, you received the letter on April 24, 1987; is that right?
 
A. Right.

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