United States District Court, N.D. Illinois, Eastern Division
NEJLA K. LANE and LANE LEGAL SERVICES, P.C., an Illinois Professional Corporation, Plaintiffs/Counter-Defendants,
STEPHEN KENJI LE BROCQ, Defendant/Counter-Plaintiff.
MEMORANDUM OPINION AND ORDER
Castillo Chief Judge.
K. Lane ("Lane") and her law firm Lane Legal
Services, P.C. ("LLS") (collectively
"Plaintiffs") bring this action against Stephen
Kenji Le Brocq ("Defendant"), a former employee,
alleging violations of federal privacy laws, breach of
contract, fraud, and related claims. (See R. 48,
Mem. Op. & Order.) Defendant, in turn, asserts
counterclaims for breach of contract, fraud, intentional
infliction of emotional distress, defamation, and unpaid
wages under the Illinois Wage Payment and Collection Act
("IWPCA"), 820 ILL. Comp. Stat. 115/5 et
seg. (R. 51, Answer & Countercl.) Plaintiffs move to
dismiss Defendant's counterclaims under Federal Rule of
Civil Procedure 12(b)(6). (R. 65, Mot.) For the reasons
stated below, the motion is granted in part and denied in
facts underlying the parties' dispute were fully set
forth in a prior opinion and are repeated here only as is
necessary to resolve the present motion. See Lane v. Le
Brocq, 15 C 6177, 2016 WL 1271051 (N.D. Ill. Mar. 28,
2016). Lane and Defendant are both attorneys licensed to
practice law in Illinois. Id. at *1. In May 2013,
when Defendant was still a law student, he began working for
Plaintiffs. Id. In May 2014, Defendant became a
licensed attorney and continued working for Plaintiffs in
that capacity. Id. On February 18, 2015, the parties
entered into an employment agreement, which contained terms
governing Defendant's salary, vacation time, entitlement
to fees, use of the firm's financial accounts, and other
matters. (R. 51-1, Agreement.) The agreement further provided
that "[e]ither party may terminate this agreement at any
time with reasonable cause." (Id. ¶ 8.) In
May 2015, Defendant left the firm to start his own law firm.
Lane, 2016 WL 1271051, at *2. Plaintiffs then filed
this action, alleging that when Defendant left the firm he
stole information and clients and breached various aspects of
the parties' written employment agreement. Id.
at *4. The Court granted in part and denied in part
Defendant's motion to dismiss the complaint under Rule
12(b)(6). Id. at *5-15.
Defendant answered the complaint and asserted six separate
counterclaims, claiming that it was Plaintiffs who
acted wrongfully and breached the parties' employment
agreement. (R. 51, Answer & Countercl. ¶¶
7-58.) In Count I, he alleges that Plaintiffs breached the
parties' agreement by failing to pay him wages and
vacation pay in the amount of $12, 750. (Id.
¶¶ 7-11.) In Count II, he alleges that
Plaintiffs' failure to pay him his unpaid wages
constituted a violation of the IWPCA. (Id.
¶¶ 12-27.) In Count III, he alleges that Plaintiffs
breached the parties' agreement by failing to pay him his
portion of fees generated in cases he worked on while
employed at LLS. (Id. ¶¶ 28-36.) In Count
IV, he alleges that Plaintiffs engaged in fraud when Lane
told him he was free to leave the firm at any time and that
she would be "happy" for him to open his own law
practice-statements he claims were patently false.
(Id. ¶¶ 37-44.) In Count V, Defendant
alleges intentional infliction of emotional distress against
Lane, claiming that she "has done everything possible to
attempt to sabotage and otherwise destroy Defendant's
life" since he left the firm, including telling law
enforcement agencies, state bar regulators, and others that
he is "untrustworthy, a thief, [and] not fit to practice
law." (Id. ¶¶ 45, 48.) In Count VI,
Defendant alleges that Lane defamed him during her
"crusade of vilification" after he left the firm,
making negative statements about him to "a host of
individuals and entities." (Id. ¶ 53.) He
seeks an award of actual damages, attorneys' fees, and
other relief. (Id.) Lane moves to dismiss all of
Defendant's counterclaims under Rule 12(b)(6). (R. 65,
Mot.; R. 66, Mem.) The motion is now fully briefed. (R. 71,
Resp.; R. 73, Reply.)
12(b)(6) motion "challenges the viability of a complaint
by arguing that it fails to state a claim upon which relief
may be granted." Firestone Fin. Corp. v. Meyer,
796 F.3d 822, 825 (7th Cir. 2015) (citation omitted). In
deciding a Rule 12(b)(6) motion, the Court views the
complaint in the light most favorable to the plaintiff,
accepts all well-pleaded factual allegations as true, and
draws all reasonable inference in the plaintiffs favor.
Vesely v. Armslist LLC, 762 F.3d 661, 664-65 (7th
Cir. 2014). The Court can consider the "allegations set
forth in the complaint itself, documents that are attached to
the complaint, documents that are central to the complaint
and are referred to in it, and information that is properly
subject to judicial notice." Willamson v.
Curran, 714 F.3d 432, 436 (7th Cir. 2013). To survive
dismissal, a complaint "must contain sufficient factual
matter ... to 'state a claim to relief that is plausible
on its face.'" Ashcroft v. Iqbal, 556 U.S.
663, 678 (2009) (quoting Bell Atl. Corp. v. Twombly,
550 U.S. 544, 570 (2007)). "A claim has facial
plausibility when the plaintiff pleads factual content that
allows the court to draw the reasonable inference that the
defendant is liable for the misconduct alleged."
Id. Because federal courts employ notice pleading,
rather than fact pleading, a plaintiff is not required to
include "detailed factual allegations" to survive
dismissal. Alexander v. United States, 721 F.3d 418,
422 (7th Cir. 2013). Instead, "the plausibility
requirement demands only that a plaintiff provide sufficient
detail to present a story that holds together."
Id. (citation and internal quotation marks omitted).
Claims of fraud are an exception to this rule, as they must
be pled "with particularity." Fed.R.Civ.P. 9(b).
This means that the party alleging fraud must describe the
"who, what, when, where, and how" of the fraud.
Wigod v. Wells Fargo Bank, N.A, 673 F.3d 547, 569
(7th Cir. 2012) (citation omitted).
Breach of Contract (Counts I and III)
Count I, Defendant alleges that Plaintiffs' breached the
parties' February 2015 agreement by failing to pay him
wages and vacation pay he is owed. (R. 51, Answer &
Countercl. ¶¶ 7-11.) Under Illinois law, a party
asserting breach of contract must plead four elements: (1)
the existence of a valid and enforceable contract; (2)
performance of the contract by the claimant; (3) a breach by
the other party; and (4) injury to the claimant. Hess v.
Bresney, 784 F.3d 1154, 1158 (7th Cir. 2015) (citing
Henderson-Smith & Assocs. v. Nahamani Family Serv.
Ctr., 752 N.E.2d 33, 43 (Ill.App.Ct. 2001)). Contracts
"must be construed as a whole, viewing each provision in
light of the other provisions." United States v.
Rogers Cartage Co., 794 F.3d 854, 861 (7th Cir. 2015)
(quoting Thompson v. Gordon, 948 N.E.2d 39, 47 (Ill.
2011)). The Court's "primary objective in construing
a contract is to give effect to the intent of the
parties." Gallagher v. Lenart, 874 N.E.2d 43,
58 (Ill. 2007). "Unambiguous contract terms must be
given their plain and ordinary meaning." QuickClick
Loans, LLC v. Russell, 943 N.E.2d 166, 172 (Ill.App.Ct.
2011). A contract is considered ambiguous if it is unclear or
susceptible to more than one meaning. Gallagher, 874
N.E.2d at 58. "[W]hether a contract is ambiguous is a
question of law." Cent. III. Light Co. v. Home Ins.
Co., 821 N.E.2d 206, 214 (Ill. 2004). If a contract term
is ambiguous, the Court can consider extrinsic evidence to
determine the parties' intent, but this becomes a
question of fact that cannot be decided on a motion to
dismiss. Bank of Am., N.A. v. Oberman, Tivoli &
Pickert, Inc., 12 F.Supp.3d 1092, 1100 (N.D. Ill. 2014)
(citing Quake Constr., Inc. v. Am. Airlines, Inc.,
565 N.E.2d 990, 994 (Ill. 1990)).
alleges that a valid contract exists between the parties, and
he includes the agreement as an exhibit. (R. 51, Answer &
Countercl. ¶ 8; R. 51-1, Agreement.) He further alleges
that he performed his obligations under the agreement, and
that Plaintiffs breached the agreement by failing to pay him
certain wages and vacation pay. (R. 51, Answer &
Countercl. ¶¶ 10, 25.) He claims that he has been
damaged in the amount of $12, 750, which by his calculation
is the amount he is owed under the agreement. (R. 51, Answer
& Countercl. ¶ 10.) Taking these allegations as
true, Defendant has adequately alleged a breach of contract
claim. See Hess, 784 F.3d at 1158-59.
argue, however, that Defendant's claim fails because he
is not entitled to the number of vacation days that he
claims. (R. 66, Mem. at 2; R. 73, Reply at 1-2.) They argue
that under Illinois law, employees earn vacation pay pro rata
as they render services to their employer, and by their
count, Defendant is entitled to at most seven days of
vacation. (R. 66, Mem. at 2.) Plaintiffs cite to Arrez v.
Kelly Servs., Inc., 522 F.Supp.2d 997, 1002 (N.D. Ill.
2007), but that case does not support Plaintiffs'
position. (See R. 73, Reply at 2.) The contract in
Arrez was a "length-of-service" plan,
meaning that the employee's vacation time was guaranteed
only if he rendered services for a certain period.
Arrez, 522 F.Supp.2d at 1002; see also Golden
Bear Family Rests., Inc. v. Murray, 494 N.E.2d 581, 582
(Ill.App.Ct. 1986) (employees earned vacation pay pro rata
where defendant's vacation policy provided that accrued
vacation pay would not be paid to employees terminated within
the calendar year).
case, by contrast, the parties' agreement states in plain
language that Defendant is "entitled to take
twenty-eight (28) days for personal paid vacation time during
the fiscal year." (R. 51-1, Agreement ¶ 4.) This
provision does not contain any qualification as to how the
days accrue or may be used, nor does it contain a
length-of-service provision like the policy at issue in
Arrez. (Id.) At best the language is ambiguous, and
determining what the parties intended when they drafted this
provision is an issue of fact that cannot be resolved on a
motion to dismiss. Bank of Am., 12 F.Supp.3d at
1100. Accordingly, the Court declines to dismiss on this
also argue that Defendant's allegations in Count I are
inconsistent because he lists two different totals of the
number of days he is owed. (R. 66, Mem. at 2.) It is true
that in paragraph ten Defendant states that he is owed for 36
days, whereas in paragraph 19 he alleges that he is owed for
34 days. (R. 51, Answer & Countercl. ¶¶ 10,
19.) Defendant clarifies in his response brief that he meant
to claim payment for 34 days; presumably the other number was
a scrivener's error. (See R. 71, Resp. at 3.) In
any event, this type of minor discrepancy is immaterial. At
the pleading stage, Defendant only needs to allege a
plausible breach of contract claim, and exact calculations of
the damages he is owed under the contract are not required.
See Traffic Tech, Inc. v Kreiter, No. 14-cv-7528,
2016 WL 4011229, at *3 (N.D. Ill. July 27, 2016) (rejecting
defendant's attack on plaintiffs "arithmetic"
used to calculate how much he was owed under the parties'
agreement, because "[w]hose calculation is correct is a
disputed issue of fact that cannot be resolved at the motion
to dismiss stage"); Martin v. Asset Acceptance,
LLC, No. 11 CV 6256, 2012 WL 3042524, at *2 (N-D. Ill.
July 25, 2012) (observing that when courts decide a Rule
12(b)(6) motion, "the issue is not whether [plaintiff]
could prove her damages, but whether she stated a proper
claim for relief). Defendant has plausibly alleged that he is
owed money under the parties' agreement for work and
vacation, and therefore, the motion is denied as to Count I.
relatedly argue that Defendant fails to state a claim in
Count III, which seeks unpaid fees under this same agreement.
(R. 66, Mem. at 5-6.) In Plaintiffs' view, Defendant is
not entitled to any fees that were received after he left the
firm. (Id.) Defendant disagrees with this
interpretation. (R. 71, Resp. at 7.) The parties'
agreement provides in pertinent part:
Any Personal Injury settlements/judgments/verdicts shall be
allocated in gross within Lane Legal Services, P.C. as
follows: 50% to Lane Legal Services, P.C. and 1/3 to NEJLA K.
LANE and STEPHEN LE BROCQ, respectively, remainder shall be
given to other attorneys ...