United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
M. DOW, JR. UNITED STATES DISTRICT JUDGE.
matter is before the Court on Defendant Fluidmesh Networks,
LLC's motion  to dismiss Plaintiff Robert Huang's
complaint for lack of jurisdiction and for failure to state a
claim. For the reasons set forth below, Defendant's
motion  is granted. Plaintiff is given until August 18,
2017 to file an amended complaint consistent with this
case involves the termination of Plaintiff Robert Huang's
employment with Defendant Fluidmesh Networks, LLC over
alleged whistleblowing activities. The complaint invokes the
Court's diversity jurisdiction, alleging that Plaintiff
is a citizen of Taiwan, Defendant is a Delaware corporation with
its principal place of business in Illinois, and the amount
in controversy exceeds $75, 000. See  at ¶¶ 1-3.
to the complaint, Defendant sells certain products to Cisco
Systems, Inc. (“Cisco”)-a publicly traded
company-for resale. See id. at ¶¶ 6-7.
Plaintiff began working for Defendant in December 2011 as a
“Supply Chain and Manufacturing Manager, ” and he
performed his work “remotely from his homes in Taiwan
and California.” Id. at ¶ 5. Plaintiff
also asserts that he was a “subcontractor of Cisco,
” presumably at the same time he worked for Defendant,
although the complaint is not clear on the details of this
arrangement. Id. at ¶ 13.
February 2013, Defendant's Chief Executive Officer,
Umberto Malesci, wrote to Plaintiff at a Taiwan address,
offering him (1) a raise in salary, (2) a bonus, and (3) a 1%
profit interest in a new, wholly owned subsidiary of
Defendant-Bitlomat, LLC (“Bitlomat”). Malesci
stated that the interest “shall vest linearly over the
five years starting March 1, 2013 as long as you are engaged
as a full-time employee of the [Defendant].” The offer
letter noted that its terms were subject to approval by
Defendant's Board of Managers, and it was signed by both
Malesci and Plaintiff. See [1-1].
asserts that, following this letter, Defendant provided a
contract “detailing the terms and conditions” of
the profit interest.  at ¶ 22. The contract, which
Plaintiff attached to the complaint, see [1-2], is titled an
“Interest Grant Agreement”
(“Agreement”), and Bitlomat and Plaintiff are
listed as the contracting parties. The document appears to
have contemplated an effective date in November 2013; neither
Plaintiff nor an agent of Bitlomat executed the document. See
id. at 1, 12.
later, in January 2016, Plaintiff alleges that
Defendant's Chief Technology Officer, Alessandro Erta,
“told a third party that Cisco intended to
purchase” Defendant.  at ¶ 8. Believing the
information to be false and also having the potential to
influence Cisco's stock price, Plaintiff reported the
incident internally to his immediate supervisor, who happened
to be Erta. Plaintiff contends that he also reported the
incident to Erta's supervisor. According to Plaintiff, he
told both individuals that he believed the disclosure of
information about Cisco's purchase of Defendant was
“illegal” and he “indicated that he would
report the rule violation to the appropriate
authorities.”  at ¶ 11. Plaintiff does not
allege that he reported the incident to anyone else.
February 19, 2016, Defendant terminated Plaintiff's
employment. Plaintiff asserts that Defendant “provided
no basis for the termination, ” id. at
¶¶ 15-16; he alleges that he was fired for
“reporting securities law violations, ” and he
cites to 18 U.S.C. § 1514A, which he states prohibits
“retaliation against employees of public
companies” that report “certain types of
allegedly unlawful conduct.” See id. at
¶¶ 12, 17.
October 2016, Plaintiff filed a three-count complaint ,
asserting a violation of the Illinois Whistleblower Act, 740
ILCS 174/1 et seq. (Count I), id.
¶¶ 26-28; retaliatory discharge (Count II),
id. ¶¶ 30-32; and seeking a declaration
that his ownership interest in Bitlomat is fully vested
(Count III), id. ¶¶ 34-36. Defendant filed
a motion to dismiss all three claims pursuant to Federal
Rules of Civil Procedure 12(b)(1) and 12(b)(6), arguing that
(1) Plaintiff does not have standing to pursue his Illinois
employment law claims and (2) all three counts fail to state
a claim upon which relief can be granted. Defendant has
provided a declaration by Malesci as support for its 12(b)(1)
arguments. According to Malesci, who, along with Erta, is
based in Italy, Plaintiff was responsible for developing
Defendant's business relationships in China. Plaintiff
was not responsible for developing business relationships in
the United States, his employment was never based in
Illinois, and he never physically worked in or traveled to
Illinois as part of his employment with Defendant. In
addition, Malesci states that the “January 2016 meeting
referenced in the Complaint was held in Taiwan.” See
[24-3] (Declaration of U. Malesci) at ¶¶ 2-6.
purposes of a motion to dismiss under either Rule 12(b)(1) or
Rule 12(b)(6), the court accepts all well-pleaded factual
allegations as true and construes all reasonable inferences
in the plaintiff's favor.” Mutter v.
Madigan, 17 F.Supp.3d 752, 756 (N.D. Ill. 2014). A Rule
12(b)(1) motion challenges federal subject matter
jurisdiction. In ruling on the motion, the district court may
look beyond the jurisdictional allegations alleged in the
complaint and take into consideration whatever evidence has
been submitted on the issue to determine if subject matter
jurisdiction exists. County of Cook v. HSBC N. Am.
Holdings Inc., 136 F.Supp.3d 952, 957-58 (N.D. Ill.
2015). The burden is on the party asserting jurisdiction to
demonstrate that it exists. Id.
12(b)(6) motion challenges the legal sufficiency of the
complaint. To survive a motion to dismiss under Rule
12(b)(6), a plaintiff's complaint must allege facts
which, when taken as true, “‘plausibly suggest
that the plaintiff has a right to relief, raising that
possibility above a speculative level.'”
Cochran v. Ill. State Toll Highway Auth., 828 F.3d
597, 599 (7th Cir. 2016) (quoting EEOC v. Concentra
Health Servs., Inc., 496 F.3d 773, 776 (7th Cir. 2007)).
The Court reads the complaint and assesses its plausibility
as a whole. See Atkins v. City of Chicago, 631 F.3d
823, 832 (7th Cir. 2011). Still, “[t]hreadbare recitals
of the elements of a cause of action, supported by mere
conclusory statements, do not suffice.” Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (citing Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). In
deciding a Rule 12(b)(6) motion, the court may consider
documents attached to a complaint, such as contract
documents. Bible, 799 F.3d at 639.
Illinois Whistleblower Act
to Plaintiff, by firing him following his report of
“securities law violations, ” Defendant violated
the Illinois Whistleblower Act (“IWA”). The
purpose of the IWA is “to protect employees from
adverse employment actions in retaliation for reporting or
refusing to engage in unlawful conduct by their
employers.” Young v. Alden Gardens of Waterford,
LLC, 2015 ...