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Gracia v. Sigmatron International, Inc.

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

March 21, 2017

MARIA N. GRACIA, Plaintiff,
v.
SIGMATRON INTERNATIONAL, INC., GARY FAIRHEAD, and LINDA FRAUENDORFER, Defendants.

          MEMORANDUM OPINION AND ORDER

          John Z. Lee United States District Judge.

         Plaintiff Maria N. Gracia has brought this suit against her former employer, SigmaTron International, Inc. (“SigmaTron”), as well as Gary Fairhead and Linda Frauendorfer in their capacity as corporate officers of SigmaTron. Plaintiff's claims arise from statements made by Defendants in disclosures mandated by the Securities and Exchange Commission (SEC). Plaintiff alleges (1) retaliation by SigmaTron in violation of Title VII of the Civil Rights Act of 1964 as amended (Title VII), 42 U.S.C. § 2000e-3(a), and the Illinois Human Rights Act (IHRA), 775 Ill. Comp. Stat. 5/6-101(a); (2) defamation per se against all Defendants; and (3) false light invasion of privacy against all Defendants. For the reasons stated herein, the motion [17] is granted in part and denied in part.

         Factual Background

         SigmaTron is a Delaware corporation with its principal place of business in Elk Grove, Illinois. Compl. ¶ 2, ECF No. 1. It manufactures circuit board assemblies. Id. ¶ 6. Plaintiff began her employment at SigmaTron in 1999. Id. ¶ 5. In 2008, Plaintiff filed a charge of discrimination against SigmaTron with the Equal Employment Opportunity Commission (EEOC). Id. ¶ 8. SigmaTron received a copy of this charge on November 19, 2008, and Plaintiff was fired sixteen days later. Id. ¶ 10.

         In the litigation that ensued (“Gracia I”) Plaintiff claimed, inter alia, that SigmaTron violated Title VII by terminating her employment in retaliation for filing of the EEOC charge. Id. ¶ 13. At trial, Greg Fairhead, executive vice president of SigmaTron and the brother of Defendant Gary Fairhead, testified that Plaintiff was fired for intentionally permitting an assembler working under her supervision to use lead-free solder instead of leaded solder and being indifferent when confronted about it. Id. ¶ 14. For her part, Plaintiff asserts that she did not knowingly allow the assembly line to run, nor did she openly admit that she had done so, but rather she claims she stopped the employee as soon as the error came to her attention. Id. ¶ 31. On December 18, 2014, a jury returned a verdict in favor of Plaintiff against SigmaTron and, eventually, after several post-trial motions by SigmaTron, the court entered a judgment in Plaintiff's favor in the amount of $374, 478.14, which was affirmed on appeal. Id. ¶¶ 16, 21; Gracia v. SigmaTron Int'l, Inc., 842 F.3d 1010 (7th Cir. 2016).

         SigmaTron is a publicly traded corporation and, therefore, is required to make regular disclosures to the SEC. Compl. ¶ 2. From November 2008 to December 2014, while Gracia I was being litigated, SigmaTron included language in their quarterly disclosures that the company did not expect the legal proceedings with Plaintiff to have any material adverse impact on share values; it did not refer to the Plaintiff by name. Id. ¶ 24. However, in a July 2015 filing signed by Fairhead and Frauendorfer, SigmaTron for the first time identified Plaintiff by name, stating, “[o]n December 5, 2008, Ms. Gracia's employment . . . was terminated after she knowingly permitted an assembly line to run leaded boards in a lead-free room with lead-free solder, contrary to the customer's specifications and prohibited by Company policy. . . . Ms. Gracia openly admitted to permitting this to take place.” Id., Ex. E.

         The case before this Court (Gracia II) arises not from Plaintiff's termination, but from Defendants' SEC disclosures. Plaintiff filed an EEOC charge forming the basis of this complaint on September 2, 2015, asserting SigmaTron had retaliated against her by publishing the above statements regarding her professional competence-which she claims are false-in its SEC disclosures. Id. ¶ 36. Plaintiff further alleges that Defendants, after learning of these charges on September 3, 2015, repeated the statements regarding her termination in another SEC disclosure on September 14, 2015, in response to the charges she filed. Id. ¶ 39; id., Ex. H.

         On November 23, 2015, Plaintiff's counsel sent a cease-and-desist letter to Greenberg Traurig, the law firm that oversees SigmaTron's SEC filings, insisting SigmaTron stop publishing the statements that Plaintiff claims are false, but SigmaTron never responded. Id. ¶¶ 42-45. Subsequently, on December 15, 2015, and March 15, 2016, SigmaTron again referenced Plaintiff by name in its SEC disclosures. Id. ¶¶ 46, 49.

         Plaintiff asserts that SigmaTron's SEC disclosures, as authorized by Fairhead and Frauendorfer, falsely described her actions with regard to the assembly-line events that gave rise to Gracia I. Accordingly, Plaintiff claims Defendants defamed her and invaded her privacy by portraying her in a false light, and in doing so, SigmaTron retaliated against her for engaging in activities protected under Title VII and the IHRA.

         Legal Standard

         A motion under Rule 12(b)(6) challenges the sufficiency of the complaint. Christensen v. Cty. of Boone, 483 F.3d 454, 457 (7th Cir. 2007). Under federal notice pleading standards, “[a] plaintiff's complaint need only provide a short and plain statement of the claim showing that the pleader is entitled to relief, sufficient to provide the defendant with fair notice of the claim and its basis.” Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir. 2008) (internal quotation marks omitted); see also Fed R. Civ. P. 8(a)(2). When considering a motion to dismiss under Rule 12(b)(6), the Court must “accept[ ] as true all well-pleaded facts alleged, and draw[ ] all possible inference in [the plaintiff's] favor.” Tamayo, 526 F.3d at 1081.

         Additionally, a complaint must allege “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) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). For a claim to be facially plausible, the plaintiff must plead facts allowing the court to draw the reasonable inference that the defendant is liable for the misconduct alleged in the complaint. Id. Accordingly, “[t]hreadbare recitals of the elements of the cause of action, supported by mere conclusory statements, do not suffice.” Id. Finally, the plausibility standard is not akin to a probability requirement but, rather, asks for more than a sheer possibility that a defendant acted unlawfully. Id.

         Analysis

         I. ...


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