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Monumental Life Insurance Company, An Iowa Corporation v. Illinois Mutual Life Insurance Company

November 19, 2012

MONUMENTAL LIFE INSURANCE COMPANY, AN IOWA CORPORATION, PLAINTIFF,
v.
ILLINOIS MUTUAL LIFE INSURANCE COMPANY, AN ILLINOIS COMPANY; JACK BUTTACAVOLI, AN HON. HARRY D. LEINENWEBER INDIVIDUAL;
GLADSTON DUSSARD, AN INDIVIDUAL; LESLIE HUGHEY, AN INDIVIDUAL; AND
CHARLENE MCCOY, AN INDIVIDUAL, DEFENDANTS.



The opinion of the court was delivered by: Harry D. Leinenweber, Judge United States District Court

MEMORANDUM OPINION AND ORDER

Before the Court are Defendant Jack Buttacavoli's ("Buttacavoli") Motion for Partial Judgment on the Pleadings and Plaintiff Monumental Life Insurance Company's ("Monumental" or "Plaintiff") Motion for Sanctions (contained in its response to Defendant's motion). For the reasons stated herein, both motions are denied.

I. BACKGROUND

Buttacavoli became a District Manager for Monumental in 2002, signing a District Manager's Agreement (the "Manager's Agreement") at that time. The Manager's Agreement, drafted by Monumental, contained restrictive covenants limiting Buttacavoli's ability to disseminate confidential company information, to work for competitors and to entice Monumental employees to leave the company. According to Monumental's Complaint, Buttacavoli retired from Monumental on December 31, 2010. However, after his retirement, he again worked for Plaintiff and signed a new agreement (the "Sales Associate Agreement") with Monumental on January 11, 2011. (The record is not crystal clear on whether there was any break in service between his retirement and his work as a Sales Associate.) The Sales Associate Agreement contained restrictive covenants similar to the Manager's Agreement.

Plaintiff fired Buttacavoli in June 2011, allegedly because he was selling Defendant Illinois Mutual Life Insurance Company's policies in violation of the contract. Buttacavoli denies this.

Plaintiff alleges several counts of action against Buttacavoli and other Defendants, but the Motion for Judgment concerns only Defendant Buttacavoli and deals only with Count I of the Complaint. Count I alleges breach of both the Manager's Agreement and the Sales Associate agreement. Specifically, the Complaint alleges Buttacavoli violated the contracts by misusing confidential information while employed and by poaching customers both before and after his employment terminated. Buttacavoli clarified in his Reply that his Motion for Judgment concerns only those alleged violations occurring after his retirement of December 31, 2010.

II. LEGAL STANDARD

Under Federal Rule of Civil Procedure 12(c), "a party can move for judgment on the pleadings after the filing of the complaint and answer." Supreme Laundry Serv., LLC v. Hartford Cas. Ins. Co., 521 F.3d 743, 746 (7th Cir. 2008). The Seventh Circuit has held that for purposes of Rule 12(c), the pleadings consist of the "complaint, the answer, and any written instruments attached as exhibits." Langone v. Miller, 631 F.Supp.2d 1067, 1070 (N.D. Ill. 2009).

A motion for judgment on the pleadings pursuant to Rule 12(c) is subject to the same standard as a motion to dismiss for failure to state a claim pursuant to Rule 12(b)(6). Spearman Industries, Inc. v. St. Paul Fire and Marine Ins. Co., 109 F.Supp.2d 905, 906 (N.D. Ill. 2000). This means that the court must accept all well-pleaded allegations in the complaint as true and draw all reasonable inferences in favor of the plaintiff. Id.

A motion for judgment on the pleadings should only be granted where "the moving party demonstrates that there are no material issues of fact to be resolved." Supreme Laundry, 521 F.3d at 746.

III. ANALYSIS

A. Enforceability of the Manager's Agreement

Buttacavoli argues the post-employment restrictive covenants of the Manager's Agreement do not apply because the contract specifies that it is automatically terminated in the event of Buttacavoli's retirement. Since the post-employment restrictive covenants have no explicit savings clause indicating they survive the termination of the contract, Buttacavoli argues that the restrictive covenants also terminated upon his retirement. Monumental argues, first, that Buttacavoli did not retire. Second, Monumental argues that even if Buttacavoli did retire, his interpretation would ...


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