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Schau v. The Board of Education of Peoria Public School District No. 150

United States District Court, C.D. Illinois

May 1, 2014

PAMELA SCHAU, Plaintiff,


JAMES E. SHADID, Chief District Judge.

Defendant's Motion in Limine No. 1

Defendant has moved in limine for an order barring the introduction of any evidence or information from the Illinois Department of Employment Security ("IDES") at trial. Specifically, Plaintiff seeks to offer a determination made by the IDES concerning her eligibility for unemployment insurance benefits following her termination for purposes of establishing that her employer believed that she had engaged in conduct warranting termination.

Illinois law provides that "information obtained from any individual or employing unit during the administration of this Act shall... not be used in any court in any pending action or proceeding, [and] not be admissible in evidence in any action or proceeding other than one arising out of this Act." 820 ILCS 405/1900(A). The same prohibitions apply to any "finding, determination, decision, ruling or order (including any finding of fact, statement or conclusion made therein) issued pursuant to this Act...." 820 ILCS 405/1900(B). Although state privileges such as this are not binding as such in federal litigation pursuant to Fed.R.Evid. 501, the Seventh Circuit has held that the uniqueness of such proceedings counsels against the use of those proceedings in subsequent litigation. McLendon v. Indiana Sugars, Inc., 108 F.3d 789 (7th Cir. 1997); Wagoner v. J.P. Morgan Chase Bank, 2014 WL 185759, at *4 (S.D.Ind. Jan. 15, 2014); Twilley v. International Bedding Corp., 2010 WL 1652960, at *9 (N.D.Ind. April 23, 2010); Smith v. G.M.G. Partners, LLC, 2002 WL 31749184 at *1 (N.D.Ill.Dec. 3, 2002);. Thus, it is clear that the IDES determination itself is inadmissible at trial in this matter, and Defendant's Motion in Limine No. 1 is granted in this respect.

That being said, if the purpose of seeking to introduce the IDES document is to establish that Defendant took the position that Plaintiff was terminated for cause, it will be admissible for that limited purpose in redacted form if the parties do not otherwise stipulate.

Plaintiff's First Motion in Limine

Plaintiff asks the Court to bar Defendant from offering evidence refuting or contradicting:

(1) that the District objected to her claim for unemployment benefits; (2) that at the time the District objected to her claim, it believed it had cause to discharge her; and (3) that the District terminated Plaintiff from employment based upon its belief that she had engaged in conduct warranting her discharge. Specifically, Plaintiff argues that these admissions were made in Defendant's Answer to the Complaint and have never been withdrawn. Therefore, she contends that they are binding judicial admissions for purposes of trial.

Defendant concedes that the first issue is not in dispute, but suggests that the issues are nevertheless irrelevant, as the Court has held that Defendant was not prohibited from using the non-causal termination provision of the employment agreement to dismiss any employee even if the District has reason to dismiss for cause. While this is an accurate statement of a portion of the Court's 2/28/14 Order, Defendant attempts to preclude this evidence by ignoring the remainder of the opinion, wherein the Court notes that Plaintiff can demonstrate a denial of due process based on a showing that the District purportedly terminated her under the non-causal provision and then later took a position inconsistent with that decision in order to deprive her of her right to a hearing. In other words, for what it's worth, Plaintiff will be allowed to try to show that her removal under the non-causal provision was merely a pretext to avoid a due process proceeding for the Plaintiff. Plaintiff's First Motion in Limine is therefore granted.

Defendant's Motion in Limine No. 2

Assuming Plaintiff makes a separate claim for breach of contract at trial, Defendant argues that its damages on the breach of contract claim are limited to the amount of liquidated damages payable upon dismissal without cause pursuant to Dunlap v. Alcuin Montessori School, 298 Ill.App.3d 329; 698 N.E.2d 574 (1998). Defendant maintains that Dunlap stands for the proposition that in a breach of contract claim, where a contract allows for dismissal without cause, any damages arising from a breach of contract are limited to those specified in the without-cause provision. Id., at 578-79.

Plaintiff responds that the District's interpretation of the contract language would turn the contract into an at-will employment agreement. As interpreted by state and federal courts reviewing substantially similar contract provisions, this is essentially true. The language has been held to be an enforceable early termination provision that allows the district to terminate the contract "for whatever reason" as long as it paid the specified damages. In fact, the Court has previously stated that had Defendant not subsequently taken inconsistent positions, it would likely have been entitled to summary judgment in its favor. See McArdle v. Peoria School District No. 150, 705 F.3d 751, 755 (7th Cir. 2013) (finding that termination "for whatever reason" pursuant to an early termination clause with payment as specified in the contract does not constitute a breach of contract); Jones v. Chicago State University, ___ N.E.2d ___, 2009 WL 9438996, at *2 (Ill.Ct.Cl. Sept. 9, 2009).

Generally, the proper measure of damages in a breach of contract action is "the amount of money that will place the injured party in as satisfactory a position as he would have been in had the contract been performed." Cress v. Recreation Services, Inc., 795 N.E.2d 817, 850 (2nd Dist. 2003). However, the rights of parties to a contract are limited by the terms of the contract itself, and under Illinois law, parties to a contract can limit remedies and damages for breach if their understanding is reflected in the agreement. Cress, 795 N.E.2d at 850-51, citing Klemp v. Hergott Group, Inc., 641 N.E.2d 957 (1994). Where a contract specifically provides for an early termination provision, those provisions will determine the measure of damages reasonably related to the breach. Dunlap, 698 N.E.2d at 336-37. Section 3(e) of the amended agreement states that in the event of early termination, Plaintiff is entitled to "ten (10%) percent of the Comptroller-Treasurer's unpaid annual salary computed from the effective date of the notice of termination to June 30 of that Contract year, but in no event less than $5, 000.00." The Court agrees with Defendant that this limits the damages available to Plaintiff on her breach of contract claim in the event that the jury finds that there was a breach by the Board.

Defendant next argues that the multi-year contract at issue is void because it didn't comply with the Illinois School Code's requirement that multi-year contracts for school district administrators contain goals and indicators of student performance as required by 105 ILCS § 5/10-23.8a. This argument is without merit. The plain language of § 10-23.8a applies to the contracts of principals, assistant principals, and other administrators whose responsibilities and duties involve student performance and academic improvement through instructional leadership and the planning, operation, and evaluation of the educational program at the school. Plaintiff was the comptroller/treasurer, and nothing in the record suggests in any way that ...

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