United States District Court, N.D. Illinois, Eastern Division
November 4, 2004.
MICHAEL C. MADDIE, Plaintiff,
SIEBEL SYSTEMS, INC., a Delaware Corporation, and DONALD O'SHEA, Defendants.
The opinion of the court was delivered by: AMY J. ST. EVE, District Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Michael Maddie filed a complaint against his former
employer, Siebel Systems, Inc. and his former supervisor, Donald
O'Shea, alleging: defamation (Count I); tortious interference
with a contract (Count II); civil assault (Count III); tortious
supervision, retention, and investigation (Count IV); breach of
contract (Count V); and intentional infliction of emotional
distress. (Count VI). Defendants move to dismiss all claims under
Federal Rule of Civil Procedure 12(b)(6) for failure to state a
claim. For reasons stated herein, the Court denies Defendants'
motion to dismiss Counts I, II, III, and V, grants in part and
denies in part their motion to dismiss Count IV, and grants their
motion to dismiss Count VI.
The purpose of a motion to dismiss pursuant to Rule 12(b)(6) is
to test the legal sufficiency of a complaint not the merits of
the case. Triad. Assocs, Inc. v. Chicago Hous. Auth.,
892 F. 2d 583, 586 (7th Cir. 1989). The well-plead allegations of a
complaint must be accepted as true. Thompson v. Illinois Dep't
of Prof'l Regulation, 300 F.3d 750, 753 (7th Cir. 2002). The courts construe ambiguities in favor of the plaintiff. Id.
Plaintiff can plead conclusions and need not allege all or any
facts entailed by the claim. Shah v. Inter-Continental Hotel
Chicago Operating Corp., 314 F.3d 278, 282 (7th Cir. 2003).
For the purpose of this Opinion, the following facts are
accepted as true. Siebel Systems, in Rosemont, Illinois, is
engaged in the business of developing customer relationship
management software and providing consulting services to
implement software. Michael Maddie began working as a consultant
for Siebel Systems in June of 2000. (R. 1-1, Pl's Comp. ¶ 7.)
Donald O'Shea was one of Maddie's supervisors. (Id. at ¶ 21.)
In October or November of 2002, Maddie expressed an interest in
transferring into another group within the company the Customer
Relationship Management Strategy Group ("CRM"). (Id. at ¶ 20.)
CRM offered Maddie a position pending approval of management
including Donald O'Shea. (Id. at ¶¶ 20-21.) When O'Shea learned
of Maddie's possible transfer he was furious and told another
manager, "I don't like this guy. I'm not going to transfer him,
I'm just going to fuck with him and use him until he leaves."
(Id. at ¶ 22.) O'Shea allegedly thereafter denied Maddie's
transfer request and told representatives of the CRM Strategy
Group that, "[Maddie] was a performance issue and being counseled
and therefore was not eligible for transfer." (Id. at ¶ 23.)
In January of 2003, Maddie attempted to transfer into the
Automotive Product Marketing Group ("APM") and APM offered him a
position. APM advised Plaintiff that they would "coordinate
approval of the transfer with O'Shea." (Id. at ¶¶ 26-27.)
O'Shea allegedly did not approve the transfer and APM eventually
froze all transfers into the group. (Id. at ¶¶ 28-29.) O'Shea
told Plaintiff that he "only transfer[s] the right people out of
the group." (Id. at ¶ 29.) On or about April, 28, 2003, Maddie alleges that O'Shea
confronted him about arriving late to work. (Id. at ¶ 31.)
Allegedly O'Shea acted in a manner that caused Maddie to think he
was about to be physically attacked. (Id. at ¶¶ 31-37.) The
altercation ended with O'Shea demanding Maddie's resignation.
(Id. at ¶ 31.)
Maddie contacted Cynthia Erickson, the Director of Human
Resources, to complain. (Id. at ¶¶ 39-40.) Erickson told Maddie
to stay away from O'Shea and "await her call while she contacted
O'Shea and the Project Manager to get their side of the story."
(Id. at ¶ 39.)
On April 30, 2003, Plaintiff contacted Erickson to inquire
about the status of her investigation. (Id. at ¶ 40.) During
the call, Erickson allegedly told Plaintiff that the company
Human Resources Department was processing his resignation.
(Id.) Erickson said that O'Shea informed her that Maddie had
resigned. (Id. at ¶ 41.) Erickson said her investigation was
ongoing. (Id. at ¶¶ 41-42.) Plaintiff advised Erickson that he
had not resigned. (Id. at ¶ 40.)
On May 1, 2003, Erickson e-mailed Plaintiff stating that "Don
[O'Shea] is under the impression that he accepted your
resignation effective Monday 4/28 and the HR Operations dept has
processed paperwork to that effect. I have not been able to reach
Don today to discuss this further. I can confirm today that you
no longer work for Siebel . . ." (Id. at ¶ 44.)
On July 25, 2003, Siebel Systems' Senior Corporate Counsel
advised Plaintiff that Siebel had completed its investigation of
his allegations. She concluded that Plaintiff "was an at-will
employee who was terminated lawfully by Siebel Systems, Inc."
(Id. at ¶ 55.) In August of 2003, another Corporate Counsel
concluded that O'Shea "was not responsible for [Plaintiff's]
ultimate departure and supported him during his tenure." (Id.
at ¶ 58.) On May 17, 2004, Plaintiff filed this lawsuit. ANALYSIS
I. Defamation (Count I)
Plaintiff argues that in October or November of 2002, O'Shea
made a defamatory statement that Plaintiff was a performance
issue and being counseled and therefore was not eligible to
transfer. (R. 1-1, Pl's Comp. at ¶ 23.) Defendants argue that:
(1) the one year statute of limitations bars Plaintiff from
bringing this action; (2) the alleged statement did not contain
an objectively verifiable fact and was therefore a
constitutionally protected opinion; and (3) Siebel Systems cannot
be held liable for a defamation tort committed by O'Shea. (R.
6-1, Def. Mot. to Dis. ¶ 2).
A. Statute of Limitations
Courts should only grant a motion to dismiss based on statute
of limitations if the plaintiff can prove no set of facts that
would support a cause of action. See 735 ILCS 5/2-619.
Defendants correctly points out that Illinois has a one-year
statute of limitations in defamation actions. See
735 ILCS 5/13-201. In certain defamation actions, however, courts have
applied the discovery rule. Tom Olesker's Exciting World of
Fashion, Inc. v. Dun & Bradstreet, Inc., 61 Ill.2d 129,
334 N.E.2d 160, 161 (1975); Schweihs v. Burdick, 96 F.3d 917, 920
(7th Cir. 1996). Specifically, if the confidential nature of
the defendant's publication prohibits the plaintiff from early
discovery of the defamation, then the statute of limitations
commences when the plaintiff knew or should have known of the
defamatory statements, not from the date of publication. Id.
Courts have applied this reasoning to oral statements as well as
written communications when the plaintiff was not present at the
time of the statement and the statement was not made publicly.
See Luttrell v. O'Conner Chevrolet, Inc., No. 01 C 0979, 2001
WL 1105125, at *6-7 (N.D. Ill. Sep. 19, 2001). Plaintiff has alleged that he was not present
when the alleged statement was made in 2002, that he did not
learn of the statement until April of 2004, and had no reason to
know of it earlier (R.1-1, Pl's. Comp. at ¶ 61.) Plaintiff has
alleged facts that, if true, could trigger the use of the
discovery rule. Accordingly, the Court cannot conclude at this
stage that Plaintiff's defamation claim is time-barred.
B. The Allegedly Defamatory Statement
The Court is not persuaded by Defendants' argument that
O'Shea's alleged statements amount to constitutionally protected
opinions. The Illinois Supreme Court has held that statements are
only constitutionally protected when they cannot reasonably be
interpreted as stating actual facts. Bryson v. News Am. Publ'ns,
Inc., 174 Ill.2d 77, 100, 220 Ill. Dec. 195, 672 N.E.2d 1207,
1220 (Ill. 1996). Plaintiff has alleged that O'Shea said that
Plaintiff was a performance issue and being counseled and
therefore not eligible for transfer. Whether Plaintiff was "being
counseled" can reasonably be interpreted to be an objectively
verifiable fact. Similarly, whether Plaintiff was ineligible for
transfer can also be interpreted as an objective fact. The
statement, therefore, is not a constitutionally protected
C. Siebel's Liability
Plaintiff argues that Siebel Systems is vicariously liable for
O'Shea's defamatory statements. In order to hold an employer in
Illinois vicariously liable for an employee's torts under the
doctrine of respondeat superior, the employee must have committed
the torts within the scope of his employment. Pyne v. Witmer,
129 Ill.2d 351, 359, 135 Ill. Dec. 557, 543 N.E.2d 1304, 1308
(Ill. 1989). An employer is subject to liability for defamatory
statements made by an employee acting within the scope of
employment. Gianforte v. Elgin Riverboat Resort, No.
02-02-1390, 2003 WL 22208916, at *3 (Ill.App. Ct. Sept. 17, 2003), citing
Restatement (Second) of Agency § 247 (1958). The question of
whether an act falls within the scope of an employee's employment
generally lies with the jury. Gaffney v. City of Chicago,
302 Ill.App.3d 41, 49, 236 Ill. Dec. 40, 706 N.E.2d 914 (Ill.App.
Plaintiff has alleged that O'Shea made defamatory statements in
response to a request for a transfer from one department to
another within the Siebel Corporation. (R. 1-1, Pl's Comp. at ¶
23.) Plaintiff also has alleged that O'Shea's supervisory duties
included approving or denying transfers. (Id. at ¶ 22.) Because
O'Shea supported his denial of Plaintiff's transfer with the
alleged defamatory statement, the Court cannot conclude at this
stage that the defamatory statement falls outside the scope of
his employment. Accordingly, the Court denies Defendants' motion
to dismiss Count I.
II. Intentional Interference with Plaintiff's Employment
Expectancy (Count II)
Plaintiff alleges that Donald O'Shea intentionally interfered
with Plaintiff's employment expectancy with Siebel Systems.
O'Shea claims that as an employee of Siebel Systems he is a party
to the contract and a party cannot tortiously interfere with its
In order to succeed on a claim of tortious interference with an
employment expectancy, a plaintiff must show: (1) the existence
of a contract or a reasonable expectation of a continued business
relationship; (2) the defendant's knowledge of the contract or
expectancy; (3) an intentional and unjustified interference by
the defendant that induced or caused a breach of the contract or
prevented the expectancy from ripening; and (4) damage resulting
from the interference. See Cook v. Winfrey, 141 F.3d 322, 329
(7th Cir. 1998); Anderson v. Vanden Dorpel, 172 Ill.2d 339,
217 Ill. Dec. 720, 667 N.E.2d 1296, 1299 (Ill. 1996). Plaintiff
has sufficiently alleged these four elements in his complaint.
Defendants point out that it is settled law that a party cannot
tortiously interfere with his own contract. The tortfeasor must
be a third party to the contractual relationship. Quist v. Board
of Trs., 258 Ill. App.3d 814, 821, 196 Ill. Dec. 262,
629 N.E.2d 807 (Ill.App. Ct. 1994); IK Corp. v. One Fin. Place
Partnership, 200 Ill. App.3d 802, 819, 146 Ill. Dec. 198,
558 N.E.2d 161 (Ill.App. Ct. 1990). In response, Plaintiff cites
Mittleman v. Witous which states that a defendant employee and
a defendant company are not one in the same for purposes of the
tortuous interference analysis if the defendant employee acted on
his own behalf and not in the company interest. Mittleman v.
Witous, 135 Ill.2d 220, 250, 142 Ill. Dec. 232, 552 N.E.2d 973
(Ill. 1990), abrogated on other grounds, Kuwik v. Starmark Star
Mktg. Admin., Inc., 156 Ill.2d 16, 118 Ill. Dec. 765,
619 N.E.2d 129 (Ill. 1993). Plaintiff has alleged that Defendant O'Shea
intentionally and willfully interfered with Plaintiff's
employment expectancy solely for his own benefit and/or to injure
Plaintiff. This sufficiently alleges that O'Shea was acting on
his own behalf and not in the company's interest.
Defendants' contention that Plaintiff cannot claim that O'Shea
acted independently of Siebel in one count and claim vicarious
liability of Siebel for O'Shea's actions in other counts is
erroneous. Under the federal rules, "a party may state as many
claims as the party has, regardless of consistency." Fed.R.Civ.P.
8(e)(2). Plaintiff is "entitled to plead in the alternative."
Alper v. Altheimer & Gray, 257 F.3d 680, 687 (7th Cir.
2000). Accordingly, the Court denies the motion to dismiss Count
III. Civil Assault (Count III)
In Count III, Plaintiff claims civil assault against both
Defendants. Plaintiff alleges that O'Shea "made an intentional, unlawful offer of corporal injury by
force to Plaintiff under circumstances which create a
well-founded fear of imminent peril to Plaintiff coupled with
O'Shea's apparent present ability to effectuate the injury." (R.
1-1, Pl's Comp. at ¶ 69.) Defendants argue that Plaintiff has
pled himself out of court by stating facts in his complaint that
even if true do not establish a claim for assault. The Court
Viewing the complaint in the light most favorable to the
Plaintiff, the Court cannot conclude that no jury would find
Defendants' actions sufficient to establish an assault cause of
action. As Defendants point out, the critical question is whether
the totality of the circumstances words, past conduct, and
surrounding circumstances can support a well-founded fear of
imminent peril during the alleged instance of assault. (R. 6-1,
Def. Memo in Support of Mot. to Dismiss ¶ 9). Count III stands.
IV. Tortious Investigation, Supervision & Retention (Count
A. Tortious Investigation
Plaintiff premises Count IV on a claim for tortious
investigation, supervision, and retention. In essence, Plaintiff
alleges that Siebel's investigation of him was a complete sham.
Illinois, however, does not recognize a cause of action for
negligent or tortious investigation. Jones v. Britt Airways,
Inc., 622 F.Supp. 389, 394 (N.D. Ill. 1985). Federal courts have
no power to create state law. Lexington Ins. Co. v. Rugg &
Knopp, Inc., 165 F.3d 1087, 1093 (7th Cir. 1999).
Plaintiff's assertion that the Court can equate negligent
investigation with "negligent undertaking" under Illinois common
law is without merit. A "negligent undertaking" claim in Illinois
concerns primarily voluntary undertakings that result in bodily
harm to a plaintiff. Kohn v. Laidlaw Transit, Inc.,
347 Ill. App.3d 746, 755, 283 Ill. Dec. 598, 605, 808 N.E.2d 564, 571 (Ill.App. Ct. 2004). Count IV does not allege facts to support a
B. Tortious Supervision and Retention
Plaintiff's complaint alleges "[f]rom the start of Plaintiff's
employment with Siebel through Siebel's investigation of O'Shea
to the present, Siebel knew or should have known that O'Shea had
a propensity for engaging in the types of wrongful and violent
conduct described hereinabove . . ." (R 1-1, Pl's Comp. ¶ 73.)
Defendants assert that because Plaintiff made Siebel aware of
O'Shea's unfitness after Plaintiff's injury occurred, Plaintiff
has in effect shown that Siebel had no knowledge of O'Shea's
unfitness before the injury. Defendants' argument is
unpersuasive. Plaintiff can assert that he informed Siebel of
O'Shea's misconduct while still maintaining that Siebel knew or
should have known of O'Shea's unfitness. Plaintiff has properly
put Defendants on notice that it is his intent to show that
Siebel should have known about O'Shea's behavior and his
propensity to engage in wrongful conduct. Accordingly, the Court
grants the motion to dismiss the tortious investigation portion
of Count IV and denies the tortious supervision and retention
V. Breach of Contract and the Covenant of Good Faith and Fair
Dealing*fn1 (Count V)
To prevail on a breach of contract claim under Illinois law, a
plaintiff must establish (1) the existence of a valid and
enforceable contract, (2) his own performance under the terms of
the contract, (3) a breach of the contract by the defendant, and
(4) an injury suffered as a result of the defendant's breach.
Chandler v. Southwest Jeep-Eagle, Inc., 162 F.R.D. 302, 311
(N.D. Ill. 1995); Aardvark Art, Inc. v. Lehigh/Steck-Warlick,
Inc., 284 Ill.App.3d 627, 220 Ill.Dec. 259, 672 N.E.2d 1271, 1275 (Ill.App. Ct. 1996). Federal court is a
notice pleading jurisdiction, therefore, complaints need not
contain elaborate factual recitations. Sanjuan v. American Bd.
of Psychiatry & Neurology, Inc., 40 F.3d 247, 251 (7th Cir.
Plaintiff alleges that Siebel and Plaintiff entered an
employment contract and agreed to abide by certain rules,
policies, and procedures. (R 1-1, Pl's Comp. ¶¶ 7-15.) Plaintiff
also alleges that he complied with the rules and regulations set
forth by Siebel. (Id. at ¶ 78.) Plaintiff further alleges that
Siebel breached that contract and Plaintiff suffered as a result.
(Id. at ¶¶ 79-80.) These allegations sufficiently state a
Although Defendants urge the Court to consider statements in
its employment handbook, the Court cannot consider such materials
on a Rule 12(b)(6) motion. See Albany Bank & Trust Co. v. Exxon
Mobil Corp., 310 F.3d 969, 971 (7th Cir. 2002) ("documents
that are neither included in the Plaintiff's complaint nor
central to the claim should not be considered on a motion to
dismiss.") The Court also notes that the handbook is dated June
15, 2004 more then one year after Plaintiff alleges Defendants
terminated him. The Court denies the motion to dismiss Count V.
VI. Intentional Infliction of Emotional Distress (Count VI)
Plaintiff alleges that O'Shea's conduct and Siebel's
acquiescence of that conduct inflicted severe emotional distress
on Plaintiff. Defendants argue that Plaintiff's allegations, even
if true, do not rise to the objective standard necessary to
sustain a claim of intentional infliction of emotional distress
("IIED") under Illinois law. The Court agrees with Defendants.
To state a cause of action for IIED, a plaintiff must plead:
(1) the defendant's conduct was extreme and outrageous; (2) the
defendant intended to inflict severe emotional distress or knew there was at least a high probability that his conduct would
inflict severe emotional distress; and (3) the defendant's
conduct caused severe emotional distress. See Honaker v. Smith,
256 F.3d 477, 490 (7th Cir. 2001). Recovery under this theory
does not extend to conduct which merely involves insults,
indignities, threats, annoyances, petty oppressions, or other
trivialities. McGrath v. Fahey, 126 Ill.2d 78, 86, 127 Ill.
Dec. 724, 533 N.E.2d 806, 809 (Ill. 1988). With respect to the
severity of Plaintiff's distress, "[t]he law intervenes only
where the distress inflicted is so severe that no reasonable man
could be expected to endure it." Public Fin. Corp. v. Davis,
66 Ill.2d 85, 90, 4 Ill. Dec. 652, 360 N.E.2d 765, 767 (Ill. 1976),
quoting Restatement (Second) of Torts § 46, comment j (1965).
The Seventh Circuit has held that even with liberal notice
pleading standards, Plaintiff must show that Defendants' actions
were objectively outrageous and the harm caused was very severe
to survive a motion to dismiss. Schroeder v. Lufthansa German
Airlines, 875 F.2d 613, 623 (7th Cir. 1989) (holding that
removing an innocent victim from her seat on a plan; confining
her to the cockpit; and accusing her of being a terrorist was not
outrageous enough to sustain a cause of action for IIED);
Harriston v. Chicago Tribune Co., 992 F.2d 697, 703 (7th
Cir. 1993) (conduct not extreme and outrageous where plaintiff
was not permitted to supervise white employees; was reprimanded
and falsely accused of poor performance; was excluded from office
activities and decisions; was forced out of a management position
and not given a promised promotion; and had her calls monitored
and her car vandalized). In a similar case, a defendant fired a
plaintiff based on an erroneous report that he had once been
convicted of a crime and subsequently repeated the false
information to third parties. Socorro v. IMI Data Search, Inc.,
No. 02 C 8120, 2003 WL 1964269, at *1 (N.D. Ill. April 28, 2003).
The court granted the motion to dismiss because the conduct involved did not rise to
the level of outrageous conduct necessary to state a claim. Id.
While Defendants' actions in blocking Plaintiff's transfers,
screaming at Plaintiff, and unfairly terminating his employment
are, if true, deplorable, they do not rise to the level of
outrageous conduct required by this tort. See Schwartz v. Home
Depot U.S.A., Inc., No. 00 C 5282, 2000 WL 1780245, at *5 (N.D.
Ill. Dec. 4, 2000) (pattern of discrimination, failure to
promote, and retaliation fell within the "unavoidable aspects of
employment relationship" that does not constitute extreme and
outrageous conduct), citing Van Stan v. Fancy Colours & Co.,
125 F.3d 563, 567 (7th Cir. 1997); see also Mustari v. New
Hope Acad., No. 03 C 4507, 2004 WL 1375530 (N.D. Ill. June 21,
2004). While losing one's job and having to relocate to find new
employment is stressful, it alone does not rise to the level of
severe emotional harm. Illinois has consistently denied claims
premised on facts stronger than what Plaintiff has pled in this
case. See, e.g., Miller v. Equitable Life Assurance Soc'y,
181 Ill.App.3d 954, 957, 130 Ill. Dec. 558, 537 N.E. 2d 887, 889
(Ill.App. Ct. 1989). Accordingly, the Court grants Defendants'
motion to dismiss Count VI. CONCLUSION
Defendants' motion to dismiss is granted in part and denied in
part. It is granted with respect to Counts IV (tortious
interference) and VI. It is denied with respect to Counts I, II,
III, IV (tortious supervision and retention), and V.