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MIHAILOVIC v. SOLDATO

March 17, 2004.

ALEKSANDAR MIHAILOVIC and SOCCER MADE IN AMERICA, INC., Plaintiffs,
v.
CARMEN SOLDATO, Mayor of Darien, MAGGIE KRONIEK, NANCY CAMPAGNOLO, AL CIMAGLIA, KURT MACH, and DARIEN DYNAMO SOCCER CLUB Defendants



The opinion of the court was delivered by: MATHEW KENNELLY, District Judge

MEMORANDUM OPINION AND ORDER

Plaintiffs Aleksandar Mihailovic and Soccer Made in America have filed suit against Carmen Soldato; the Mayor of Darien; Nancy Compagnolo, a member of the Darien Park District Board; the Darien Dynamo Soccer Club; Kurt Mach, president of the club; Al Cimaglia, a club board member; and Maggie Kroniek, a Darien resident. Plaintiffs allege that the defendants conspired to violate their due process and equal protection rights in relation to their employment contract with the Darien Park District. Plaintiffs also assert several state law claims, including defamation, intentional interference with business, conspiracy, and breach of contract. Plaintiffs settled with Campagnolo, and she has been dismissed from the case. Soldato, Mach, Cimaglia, and Kroniek have moved to dismiss pursuant to Rule 12(b)(6). For the reasons stated below, the motions are granted except as to Count 2, which remains as to defendant Soldato only. Page 2

Facts

  The following facts are taken from plaintiff's amended complaint, which the Court accepts as true for the purposes of defendants' motions to dismiss.

  In the year 2000, Mihailovic and SMIA (which we will collectively refer to as Mihailovic) entered into a contract with the Darien Park District to act as the director of soccer operations and marketing director for the Darien Sportsplex. Mihailovic also entered into a contract with the Darien Dynamo Soccer Club, a private not for profit entity which sponsors youth soccer teams, to provide services as the director of coaching.

  Starting in 2002, Mach and Cimaglia began to publicly criticize Mihailovic for "bringing in Mexicans" to the soccer club. In March 2003, Kroniek and Cimaglia made statements to the Darien Park District Board and to the public that Mihailovic was engaging in a "conflict of interest" and claiming that he had engaged in other inappropriate or unlawful acts. Shortly thereafter, Kroniek expressed concerns publicly and to the Park District Board about the financial future and community reputation of the Sportsplex. In doing so, Kroniek made several negative statements regarding Mihailovic, including allegations that he had been banned from the NCAA for foul play and bringing in players from other countries; was kicked out of another park district for "cheating them out of money"; was not playing by the rules; was engaging in a "conflict of interest;" and doing things that "were not proper."

  Soldato made negative statements about Mihailovic at the April 2003 Park District Board meeting, specifically that the payments Mihailovic had received were "in question" and that he should be "looked into," that "we all know about his background," "that there was all kinds of double dipping going on," that Mihailovic was violating the rules, and that "we cannot have Page 3 people dealing with kids that have any question about his background." In May 2003, Soldato made statements to the Park District Board to the effect that Mihailovic was "feathering his nest." Shortly thereafter, Soldato made statements to the Board and the public that the Park District "had hired a guy that was thrown out of college for violations" and "has conflicts all over the place." Soldato told the Board that he was going to keep coming to the meetings until they "let the professionals run [the Sportsplex]" and that "you will think I am harassing you." Around June 2003, Soldato began airing videotapes on the local cable television channel from the Park District Board meetings in which he and the other defendants made the previously referenced statements regarding Mihailovic.

  Mihailovic alleges that because of Soldato's position with the City of Darien, and due to the defendants' statements (all of which Mihailovic says were false), the Park District decided to terminate plaintiffs' contract. Plaintiffs also allege that the Park District acted as it did due to Mihailovic's national origin (Yugoslavian) and his attempt to diversify the club by bringing in minorities. Plaintiffs filed the instant suit alleging that because of defendants' actions they have essentially been blackballed from the community, and have been unable to pursue their chosen occupation.

  Discussion

  Dismissal under Rule 12(b)(6) is appropriate only if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46 (1957); Kennedy v. Nat'l Juvenile Del. Ass'n, 187 F.3d 690, 695 (7th Cir. 1999). In considering the motion, the court accepts as true all well pleaded facts alleged in the complaint and draws reasonable inferences from those facts in favor of the plaintiff. Page 4 Jackson v. E. J. Brach Corp., 176 F.3d 971, 977 (7th Cir. 1999); Zemke v. City of Chicago, 100 F.3d 511, 513 (7th Cir. 1996).

 Count 1 (procedural due process)

  Mihailovic claims that the defendants deprived him of both liberty and property without due process of law. The former claim is that the allegedly defamatory statements by Soldato, Mach, Cimaglia, and Kroniek, combined with the Park District Board's termination of his contract, deprived him of a liberty interest by stigmatizing him in a way that prevents him from obtaining future employment in his chosen field.

  A person does not have a protectible liberty interest in his reputation, see Paul v. Davis, 424 U.S. 693, 701 (1976), and thus simple defamation by the government does not deprive a person of liberty within the meaning of the Due Process Clause, even when it impairs one's future employment prospects. See, e.g., Siegert v. Gilley, 500 U.S. 226, 234 (1991); Paul, 424 U.S. at 697. Rather, the constitution's procedural safeguards — in this context, the right to a name-clearing hearing — are invoked only when the injury resulting from the defamation is combined with the alteration of the person's legal status, such as the termination of public employment. Paul, 424 U.S. at 708-09, 710; see also, e.g., Hojnacki v. Klein-Acosta, 285 F.3d 544, 548 (7th Cir. 2002).

  Conversely, a termination of employment is actionable under the Fourteenth Amendment as a deprivation of liberty only "if it is accompanied by a publicly announced reason that impugns the employee's moral character or implies dishonesty or other job-related moral turpitude." Omosegbon v. Wells, 335 F.3d 668, 675 (7th Cir. 2003) (quoting Hedrich v. Bd. of Regents of Univ. of Wis. Sys., 274 F.3d 1174, 1184 (7th Cir. 2001)). In other words, the Page 5 defamation must be "incident to the termination of [the plaintiff's] employment." Siegert v. Gilley, 500 U.S. 226, 234 ...


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