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Jones v. W.S. Darley & Co.

United States District Court, N.D. Illinois, Eastern Division

July 7, 2015

JOSHUA V. JONES, Plaintiff,
v.
W.S. DARLEY & CO., JAMES LONG, and GEORGE McCULLOUGH, Defendants.

MEMORANDUM OPINION AND ORDER

SHARON JOHNSON COLEMAN, District Judge.

Plaintiff, Joshua V. Jones ("Jones"), filed a ten-count pro se complaint against defendants, W.S. Darley & Co. ("Darley"), James Long, and George McCullough, alleging wrongful discharge, breach of contract, breach of the covenant of good faith and fair dealing, intentional misrepresentation, fraudulent concealment, negligent misrepresentation, intentional infliction of emotional distress, negligent infliction of emotional distress, civil conspiracy, and punitive damages, all stemming from Jones' employment at Darley. Defendants move to dismiss the complaint pursuant to Federal Rule of Civil Procedure 12(b)(6), arguing that Jones fails to state a claim under Illinois law [13]. For the reasons that follow, this Court grants the motion.

Background

In his complaint, Jones alleges that Darley extended an offer of employment on October 5, 2012, which provided Jones the option of two compensation packages. (Dkt. 1, at ¶5b). One option provided for a higher base salary with the possibility of bonuses based on sales performance, and the other option provided a lower base salary with a percentage of sales commission. (Dkt. 14-1, Ex. 1, Offer Letter).[1] Jones requested option one, the bonus structure. Darley allegedly advised Jones that it was reviewing its bonus compensation structure and would inform him of the changes once the review was complete. (Dkt. 1 at ¶5c). Jones accepted Darley's offer of employment and began work on October 19, 2012. Id. at ¶5d. Jones alleges that after several requests for sales bonus compensation, Darley terminated his employment on September 24, 2014. Id. at ¶5f. Jones also alleges that, in an email exchange between Jones and defendant James Long on September 24, 2014, Jones stated he was considering resigning to which Long responded that his resignation would be accepted immediately. Id. at ¶5g(xvii), (xx). Plaintiff asserts that he was terminated without proper compensation and by false accusations that he violated company policy.

Plaintiff initially filed the instant Complaint in the U.S. District Court for the Eastern District of California. The California court transferred the case to this district as the proper venue. (Dkt. 4).

Legal Standard

To survive a motion to dismiss under Rule 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim has facial plausibility when the complaint's factual content allows the Court to draw a reasonable inference that the defendants are liable for the misconduct alleged. Id. The Court draws all reasonable inferences in favor of the nonmoving party. Pisciotta v. Old Nat. Bancorp, 499 F.3d 629, 633 (7th Cir. 2007). Under Rule 9(b), a plaintiff must plead all allegations sounding in fraud or mistake with specificity, including who, what, where, and when of the claim. Fed.R.Civ.P. 9(b); Windy City Metal Fabricators & Supply, Inc. v. CIT Tech. Fin. Servs., Inc., 536 F.3d 663, 669 (7th Cir. 2008).

Discussion

1. Choice of Law

As a threshold matter, this Court must determine what substantive law applies the Complaint before the Court. Plaintiff makes all his allegations pursuant to California law. However, as defendants point out, the Offer Letter from Darley is the only "employment agreement" on which Jones bases his allegations and the Offer Letter contains an express choice of law clause. ( See Dkt. 14-1, Ex. 1).

"As a general rule, [i]n diversity cases, [such as here], we look to the substantive law of the state in which the district court sits, Erie R. Co. v. Tompkins, 304 U.S. 64, 78, 58 S.Ct. 817, 82 L.Ed. 1188 (1938), including choice of law rules, Klaxon Co. v. Stentor Elec. Mfg., 313 U.S. 487, 496-97, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941)." Jackson v. Payday Fin., LLC, 764 F.3d 765, 774 (7th Cir. 2014) (quoting Wachovia Sec., LLC v. Banco Panamericano, Inc., 674 F.3d 743, 751 (7th Cir. 2012) (parallel citations omitted)). However, if the case is transferred from one federal district to another, such as here, the court applies the choice of law rules of the original district, i.e., California. Cromeens, Holloman, Sibert, Inc. v. AB Volvo, 349 F.3d 376, 383 (7th Cir. 2003). Under California law, the court must determine whether the chosen state has a substantial relationship to the parties or their transaction, or whether there is any other reasonable basis for the parties' choice of law. Nedlloyd Lines B.V. v. Superior Court, 3 Cal.4th 459, 466, 834 P.2d 1148, 1152 (Cal. 1992). If either test is met, and there is no conflict with California policy, then the Court shall enforce the parties' choice of law. Id.

Here, although Jones argues that California law should apply to his claims, there is a clause stipulating that Illinois law shall apply in the Offer Letter that forms the basis of the employment relationship at issue. No one is disputing the validity of the Offer Letter, rather Jones asserts that California law should apply because that is where he resides. While Jones may currently reside in California, Darley is headquartered in Illinois, the individual defendants are Illinois residents, and, as the transferring court in California found, a substantial portion of the events took place in Illinois.[2] Enforcing such a choice of law provision in a contract is clearly not against California policy since California courts have enforced such provisions. "[W]hen a rational businessperson enters into an agreement establishing a transaction or relationship and provides that disputes arising from the agreement shall be governed by the law of an identified jurisdiction, the logical conclusion is that he or she intended that law to apply to all disputes arising out of the transaction or relationship." Washington Mutual Bank v. Superior Court, 24 Cal.4th 906, 916, 50 P.3d 1071, 1078 (Cal. 2001) (internal citation omitted). It appears from the complaint that Jones is an experienced salesperson and, thus, this Court will enforce the parties' choice of Illinois law to govern the claims in the Complaint.

2. Sufficiency of the Complaint under Illinois Law

Turning to the issue of whether this Court should dismiss the complaint for failure to state a claim pursuant to Rule 12(b)(6), the Court notes that Jones does not make any argument responsive to defendants' assertion that none of his claims are sustainable as stated under Illinois law. ( See Dkt. 18, Pl. Resp. Br.). "[W]hen presented with a motion to dismiss, the nonmoving party must proffer some legal basis to support his cause of action." Stransky v. Cummins Engine Co., 51 F.3d 1329, 1335 (7th Cir. 1995). Jones has failed to do so here and this Court could grant defendants' ...


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