Hawks v. Ballantine Communications, Inc.
ORDER; Defendant' 6 Motion to Dismiss is GRANTED in part and DENIED in part. The Motion is granted to the extent that Plaintiffs claim of intentional interference with prospective business relations is DISMISSED without prejudice. The Motion is DENIED to the extent it seeks dismissal of Plaintiffs claims under the ADEA and CADA, by Magistrate Judge Kristen L. Mix on 10/23/15.(morti, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLORADO
Civil Action No. 15-cv-01298-KLM
KIMBERLY K. HAWKS, an individual,
BALLANTINE COMMUNICATION, INC., a Colorado corporation doing business as
ENTERED BY MAGISTRATE JUDGE KRISTEN L. MIX
This matter is before the Court on Defendant’s Motion to Dismiss [#6].1 Plaintiff
filed a Response [#8] in opposition to the Motion [#6],2 and Defendant filed a Reply [#11].
The Court has reviewed the Motion, Response, Reply, the entire case file, and the
applicable law, and is sufficiently advised in the premises.3 For the reasons set forth below,
the Motion [#6] is GRANTED in part and DENIED in part.
I. Summary of the Case
“[#6]” is an example of the convention the Court uses to identify the docket number
assigned to a specific paper by the Court’s case management and electronic case filing system
(CM/ECF). This convention is used throughout this Order.
In a footnote in the Response, Plaintiff states that Defendant’s Motion, filed on August 11,
2015, was untimely. [#8] at 4 n.1. The deadline to file the Motion was August 4, 2015, because
service of the Summons and Complaint was completed on July 14, 2015. [#8] at 4 n.1. However,
“Plaintiff’s counsel . . . agreed via email to [Defendant’s] request for an extension of time on August
4, 2015.” Id. Although Defendant failed to comply with D.C.COLO.LCivR 6.1 by filing a motion or
stipulation for extension of time on the electronic docket, the Court will not deny the Motion on this
technicality given Plaintiff’s prior agreement to the extension of time.
The case has been referred to the undersigned for all purposes [#13] pursuant to the
Court’s Pilot Program and 28 U.S.C. § 636(c), upon consent of the parties [#12].
Defendant is a publishing company incorporated in the State of Colorado. Compl.
[#1] ¶ 2. Plaintiff is a former employee of Defendant who worked there for approximately
two years before being laid off in March 2013. Id. ¶¶ 6, 10. In connection with the
circumstances underlying her termination, Plaintiff asserts three claims: (1) violation of the
Age Discrimination in Employment Act (“ADEA”), (2) violation of the Colorado AntiDiscrimination Act (“CADA”), and (3) a state law claim of intentional interference with
prospective economic relations. Id. ¶¶ 39-51.
Plaintiff was born in 1962. Id. ¶ 5. On February 24, 2011, Plaintiff was hired by
Defendant as a Newsroom Assistant for the newspaper Cortez Journal. Id. ¶ 6. Plaintiff
asserts that she had no disciplinary or other problems while employed by Defendant and
that she received positive performance evaluations from two separate supervisory
Managing Editors, two merit-based raises, and a promotion. Id. ¶¶ 7-8.
In March 2013, Plaintiff was recovering from an unspecified major surgery and was
absent from work on pre-approved leave pursuant to the Family Medical Leave Act
(“FMLA”). Id. ¶ 11. On March 14, Defendant announced that it was initiating a reduction
in force and that eleven employees would be laid off effective March 29, 2013. Id. ¶ 9-10.
Despite being on FMLA leave, Plaintiff was notified by Karen Hornbaker, at the time serving
in Human Resources at the Cortez Journal, that Plaintiff needed to come to work on March
15 for a mandatory staff meeting. Id. ¶¶ 11-12. Plaintiff states that she was physically
unable to attend the staff meeting, so Defendant forced her to participate in a conference
call with General Manager Ken Amundson, HR Director Danielle Kirkpatrick, Publisher
Suzy Meyer, and then-CEO/Owner Richard Ballantine. Id. ¶ 13. Plaintiff was informed
during the call that her position was eliminated because Defendant was undergoing
financial difficulties and needed to reduce staffing. Id. ¶ 14. Plaintiff was also informed
during the call that the elimination of her position was not performance-related. Id. ¶ 15.
That same day, Plaintiff received a package of materials via overnight mail,
requesting a release of claims against the company in exchange for two weeks of
severance pay and one month of employer-funded COBRA benefits. Id. ¶ 16. The packet
of materials also included a two-page document titled “Criteria for Reduction in Force,”
which included a list of job titles and ages of employees who were and were not selected
for elimination. Id. ¶¶ 18, 20. Plaintiff asserts that at the time she received this packet of
materials, she had no reason to disbelieve Defendant’s statements that the elimination of
her position was due solely to the financial difficulties facing the company. Id. ¶ 19. At the
time Plaintiff received the materials, due to her recovery from surgery, she was not able to
stand without assistance or wear anything except pajamas, and was on multiple prescribed
pain medications and muscle relaxants. Id. ¶ 17.
Approximately six days later, on March 21, Defendant’s HR Director drove to
Plaintiff’s house to obtain a signed copy of the waiver and severance agreement. Id. ¶ 24.
Because of Plaintiff’s physical condition and the medications she was taking, Plaintiff was
unable to stand without assistance when the HR Director arrived. Id. ¶ 26. Plaintiff asserts
that having the HR Director come to her house constituted heavy pressure by Defendant
to sign the waiver and agreement. Id. ¶ 23. Plaintiff asserts that she was not afforded
proper time to review the agreement or to have it reviewed by an attorney. Id. ¶ 25.
Regardless, she signed the agreement. Id. ¶ 22. She was told she would receive a signed
copy but was never provided with one. Id. ¶ 27.
On March 29, 2013, following the official last day of work for employees of
Defendant who were subject to the reduction in force, Defendant began including classified
ads in the “Help Wanted” section of the Durango Herald newspaper for several of the
eliminated positions, including Plaintiff’s. Id. ¶ 28. In June 2013, Plaintiff learned that her
position had not been eliminated after all, and that her duties had been assumed by a
twenty-five-year-old former co-worker, Amanda Maestas (“Maestas”). Id. ¶ 29. On June
17, 2013, the “Staff Listing” section of the Cortez Journal website listed Ms. Maestas as
having Plaintiff’s former job title, i.e., Newsroom Assistant. Id. ¶ 30. On January 6, 2014,
the Cortez Journal ran a story about the changes at the newspaper and listed Ms. Maestas
as an “Assistant” with identical job responsibilities to those assigned to Plaintiff when she
was employed there. Id. ¶ 31. Ms. Maestas was also described as the Newsroom
Assistant of the Cortez Journal on the newspaper’s official twitter page as late as January
30, 2014. Id. ¶ 32. On information and belief, Defendant’s staffing levels have increased
significantly since the March 2013 reduction in force. Id. ¶ 33. Based on this later-acquired
knowledge, Plaintiff asserts that her signing of the release of claims was neither knowing
nor voluntary. Id. ¶ 34.
II. Standard of Review
Rule 12(b)(6) tests “the sufficiency of the allegations within the four corners of the
complaint after taking those allegations as true.” Mobley v. McCormick, 40 F.3d 337, 340
(10th Cir. 1994). To survive a Rule 12(b)(6) motion, “[t]he complaint must plead sufficient
facts, taken as true, to provide ‘plausible grounds’ that discovery will reveal evidence to
support plaintiff’s allegations.” Shero v. City of Grove, Okla., 510 F.3d 1196, 1200 (10th
Cir. 2007) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “[P]lausibility refers
to the scope of the allegations in a complaint: if they are so general that they encompass
a wide swath of conduct, much of it innocent, then the plaintiff[ ] [has] not nudged [her]
claims across the line from conceivable to plausible.” Khalik v. United Air Lines, 671 F.3d
1188, 1190 (10th Cir. 2012) (internal quotations and citations omitted).
“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.” Ashcroft v. Iqbal, 556 U.S. 662, 677 (2009). However, “[a] pleading that offers
‘labels and conclusions’ or a formulaic recitation of the elements of a cause of action will
not do. Nor does the complaint suffice if it tenders ‘naked assertion[s]’ devoid of ‘further
factual enhancement.’” Id. (citation omitted). That said, “[s]pecific facts are not necessary;
the statement need only give the defendant fair notice of what the . . . claim is and the
grounds upon which it rests;” the 12(b)(6) standard does not “require that the complaint
include all facts necessary to carry the plaintiff’s burden.” Khalik, 671 F.3d at 1192 .
“The plausibility standard is not akin to a ‘probability requirement,’ but it asks for
more than a sheer possibility that defendant has acted unlawfully.” Id. (citation omitted).
As the Tenth Circuit has explained, “the mere metaphysical possibility that some plaintiff
could prove some set of facts in support of the pleaded claims is insufficient; the complaint
must give the court reason to believe that this plaintiff has a reasonable likelihood of
mustering factual support for these claims.” Ridge at Red Hawk, LLC v. Schneider, 493
F.3d 1174, 1177 (10th Cir. 2007) (emphasis in original). “Where a complaint pleads facts
that are ‘merely consistent with’ a defendant’s liability, it ‘stops short of the line between
possibility and plausibility of entitlement to relief.’” Iqbal, 556 U.S. at 678 (citation omitted).
ADEA and CADA
For purposes of this Motion [#6], the parties do not appear to dispute that, if the
release of claims signed by Plaintiff is valid,4 Plaintiff may not assert her ADEA and CADA
However, Plaintiff argues that the release of claims is one of Defendant’s
affirmative defenses, and therefore she does not need to provide allegations sufficient to
withstand dismissal on this basis. The Court disagrees. In Snyder v. Embarq Mgmt. Co.,
No. 11-2271-JAR, 2011 WL 4452526, at *3 (D. Kan. Sept. 26, 2011), the court held:
Plaintiff next suggests that he is not required to plead that the waiver is
invalid because it is an affirmative defense for which defendant bears the
burden of proof. The Court agrees with defendant, however, that the
question on a motion to dismiss is whether the complaint states a claim for
relief, not whether plaintiff is able to muster evidentiary support for his claim.
The Court is required to determine whether the factual allegations, when
assumed true, “plausibly give rise to an entitlement to relief.” And if an
affirmative defense “appears plainly on the face of the complaint itself, the
motion may be disposed of under this rule.” Plaintiff concedes in the
Complaint that he signed a release of his ADEA claims, therefore, the Court
finds that it is appropriate to consider this affirmative defense on a motion to
(footnotes omitted). The same circumstances exist here.
Plaintiff argues that Defendant’s “supposed basis for her termination was false and
fraudulent, that she signed the release she was provided under duress, and that, under the
totality of the circumstances she neither knowingly nor voluntarily waived her rights under
the ADEA, and the release is [therefore] void . . . .” Response [#8] at 7-9 (citing and
summarizing Compl. [#1] ¶¶ 11-34); see also Compl. [#1] ¶ 34 (“The purported waiver
signed by Plaintiff was neither knowing nor voluntary, and is therefore void . . . .”). The
Court begins with Plaintiff’s assertion that she was fraudulently induced into signing the
release of claims.
Defendant argues that Plaintiff failed to comply with the particularity requirements
To resolve the Motion, the Court need not examine the release of claims referenced by
Plaintiff in the Complaint and attached by Defendant to the Motion. See [#6-1]. The Court therefore
does not reach the issue of whether it may do so without converting the Motion into one for
summary judgment. See Jackson v. Integra Inc., 952 F.2d 1260, 1261 (10th Cir. 1991).
of Fed. R. Civ. P. 9(b), which provides that “[i]n alleging fraud or mistake, a party must state
with particularity the circumstances constituting fraud or mistake.” “[A] complaint alleging
fraud [must] . . . ‘set forth the time, place and contents of the false representation, the
identity of the party making the false statements and the consequences thereof.’” Koch v.
Koch Indus., Inc., 203 F.3d 1202, 1236 (10th Cir. 2000) (quoting Lawrence Nat’l Bank v.
Edmonds (In re Edmonds), 924 F.2d 176, 180 (10th Cir. 1991)). “The purpose of Rule 9(b)
is to afford defendant fair notice of plaintiff’s claims and the factual ground upon which
[they] are based.” Schwartz v. Celestial Seasonings, Inc., 124 F.3d 1246, 1252 (10th Cir.
1997) (internal quotations omitted) (citations omitted).
Under Colorado law, fraud consists of the following five elements: (1) “the defendant
made a false representation of a material fact;” (2) “the party making the representation
knew it was false;” (3) “the party to whom the representation was made did not know of the
falsity;” (4) “the representation was made with the intent that it be acted upon;” and, (5) “the
representation resulted in damages.” Bennett v. Coors Brewing Co., 189 F.3d 1221, 122930 (10th Cir. 1999). Here, Plaintiff has alleged that: (1) Defendant represented during a
meeting held on March 15, 2013, that Plaintiff and her position were being eliminated
because Defendant “was undergoing financial difficulties and needed to reduce staffing;”
(2) on March 29, 2013, the day after the last official day of work for the employees who
were released due to the asserted staff reduction, “Defendant began including classified
ads in the ‘Help Wanted’ section of the Durango Herald newspaper for several of the
eliminated positions, including Plaintiff’s;” (3) Plaintiff “had no reason to disbelieve
Defendant’s statements that the elimination of her position was due solely to the financial
difficulties facing the Defendant;” (4) the document titled Criteria for Reduction in Force was
included with the packet containing the release of claims as information to consider when
signing the release of claims, and she was pressured to sign when the HR Director drove
to Plaintiff’s house to obtain the waiver on March 21, 2013; and (5) the allegedly fraudulent
reasons for her dismissal caused her to give up legal claims, including those under the
ADEA and CADA, she may have otherwise had. Compl. [#1] ¶¶ 14-28.
Defendant asserts that Yassan v. J.P. Morgan Chase & Co., 708 F.3d 963 (7th Cir.
2013), is on point and mandates that Plaintiff’s assertion of fraud under these
circumstances must be rejected. Reply [#11] at 7-8. Although the Court agrees that
Yassan is on point,5 the Court notes that this decision issued by the Seventh Circuit Court
of Appeals is persuasive, not binding, authority. See In re Korean Air Lines Disaster, 829
F.2d 1171 (D.C. Cir.1987), aff’d, 490 U.S. 122 (1989). At this early stage of the case, the
Court finds the Tenth Circuit Court of Appeals’ discussion in Bennett v. Coors Brewing Co.,
189 F.3d at 1229-30, to be more instructive:
Chase gave Yassan a severance package solely in return for his agreement to
waive all claims against Chase, including “claims he kn[e]w about and claims [he
did] not know about.” There was no other reason for Chase to pay Yassan six
months’ salary after his termination. Yassan knew this when he signed the release.
Chase may have misrepresented its reasons for terminating Yassan, and Chase
may have had ulterior motives for terminating Yassan. But Yassan explicitly
released Chase from all tort claims, including fraud. Yassan should have
considered the possibility that Chase was lying to him before he signed a release
waiving any claims that arose out of Chase lying to him. . . .
Chase gave Yassan forty-five days to consider the release, encouraged Yassan to
consult with an attorney, and made it clear that Yassan’s severance package hinged
on his signing the release. No matter what prior representations Chase had made
about its reasons for terminating Yassan, Chase was forthcoming with Yassan about
the terms of the release-severance package deal. Yassan had ample opportunity
to review and digest the terms of the deal before he agreed to it. . . .
. . . As a result, we have no trouble concluding that Yassan’s age discrimination,
wrongful discharge, and fraud claims all fail because Yassan explicitly waived his
right to make these claims when he agreed to sign a sweeping release in exchange
for a severance package.
708 F.3d at 974-75 (emphasis in original).
Under general contract principles, it is well established that a contract is void
and unenforceable if procured through fraud. . . . Appellants claim that when
Coors stated that it intended to downsize the security department by 9.36
personnel, the statement was false and Coors’ true intention was to keep the
same number of employees. . . . Thus, appellants argue, [this and other]
allegedly fraudulent statements were made either to induce them to take the
severance packages or, for those employees who had already signed a
release, to insure that those appellants would not revoke their acceptance
during the seven-day revocation period required by the [Older Worker
Benefits Protection Act].
When taken in the light most favorable to the non-moving party, the fact that
Coors began to advertise for new employees five days after appellants’
official termination date and the allegation that Coors re-hired the security
department to approximately the same number as before the downsizing is
sufficient on this record to support appellants’ allegations and establish a
prima facie claim of fraud. While appellants’ allegations concern future
events, appellants argue that, at the time Coors made these statements,
Coors knew they were false and had no intention of downsizing . . . . The
issue of fraud as it relates to the knowing and voluntary nature of the waiver
(including the disputed number of employees terminated and re-hired by
Coors) was not developed in this summary judgment record and, on the
factual record to this point, we cannot decide the issue of fraud as a matter
Here, similarly, Defendant told Plaintiff that she and others were being released due to
downsizing, but almost immediately, Defendant placed an advertisement to hire new
persons into at least some of those positions, including Plaintiffs. Compl. [#1] ¶¶ 14, 28.
Defendant attempts to distinguish Bennett. Reply [#11] at 8-9, 10 n.9. Citing to
Colorado law, Bennett states that “[a]s a general rule, actionable fraud cannot consist of
unfulfilled predictions or erroneous conjectures as to future events.” 189 F.3d at 1230. The
Court disagrees that the allegedly fraudulent statement here, i.e., that the staff reduction
was based solely on the financial difficulties of the company, consists of an “unfulfilled
prediction[ ] or erroneous conjecture[ ].” See id. Rather, the alleged statement is clearly
about a present circumstance of the company which was provided as the reason for
Plaintiff’s termination. Given the allegation that Plaintiff’s position (as well as the positions
of others) was advertised in a newspaper the day after her last official day of work, the
Court finds Bennett to be virtually indistinguishable on this point. See id. (“[T]he fact that
Coors began to advertise for new employees five days after appellants’ official termination
date and the allegation that Coors re-hired the security department to approximately the
same number as before the downsizing is sufficient on this record to support appellants’
allegations . . . of fraud.”).
Although the allegations provided by Plaintiff are not extensive, the Court finds that
Plaintiff has sufficiently satisfied Rule 9(b). See Schwartz, 124 F.3d at 1252 (“The
requirements of Rule 9(b) must be read in conjunction with the principles of Rule 8, which
calls for pleadings to be ‘simple, concise, direct, . . . and to be construed as to do
substantial justice.’” (quoting Fed. R. Civ. P. 8(e)); Williams Field Servs. Grp. LLC v. Gen.
Elec., No. 06-CV-0530-CVE-SAJ, 2008 WL 2809902 (N.D. Okla. July 21, 2008) (“Rule
9(b)’s particularity requirement, however, is not absolute or limitless; a plaintiff need not go
so far as to give the defendant a ‘pretrial memorandum containing all the evidentiary
support for plaintiff’s case.’” (quoting Schrag v. Dinges, 788 F. Supp. 1543, 1550 (D. Kan.
Accordingly, the Motion [#6] is denied to the extent Defendant seeks dismissal of
Plaintiff’s ADEA and CADA claims on this basis.6
Intentional Interference with Prospective Business Relations
Plaintiff also asserts a state law claim for intentional interference with prospective
business relations. Compl. [#1] ¶¶ 37, 48-51. In order to state this claim, Plaintiff must
allege that Defendant’s “improper and intentional interference prevented the formation of
Having found that dismissal is not warranted on this basis, the Court need not address
Plaintiff’s other arguments regarding duress and totality of the circumstances.
a contract between Plaintiff and a third party.” Jones v. Lehmkuhl, No. 11-cv-02384-WYDCBS, 2013 WL 6728951, at *23 (D. Colo. Dec. 20, 2013) (citing MDM Grp. Assocs., Inc.
v. CX Reinsurance Co., Ltd., 165 P.3d 882, 886 (Colo. App. 2007) (noting that
“[i]nterference with ‘another’s prospective contractual relation’ is tortious only if there is a
reasonable likelihood or reasonable probability that a contract would have resulted”)).
Plaintiff provides only vague, conclusory statements with respect to this claim and
no factual allegations which permit the Defendant and the Court to determine how
Defendant may have improperly and intentionally interfered with Plaintiff’s prospective
business relations. The entirety of Plaintiff’s allegations on this claim appear to consist of
the following statement: “[F]ollowing Plaintiff’s dismissal from the company and filing of
charges with the EEOC, Defendant BCI engaged in a calculated effort to undermine
Plaintiff’s future employment practices by providing false, incomplete, and/or misleading
information to potential employers, and/or failing to respond timely to potential employers
who called to verify Plaintiff’s former employment.” Compl. [#1] ¶ 37; see also id. ¶¶ 48-51.
No specific actions are attributed to Defendant and no third parties are named. This is
simply insufficient to put Defendant on notice of the grounds for this claim. See Shero, 510
F.3d at 1200. On the basis of these allegations, the Court cannot find that Plaintiff has
stated a claim for intentional interference with prospective business relations. See, e.g.,
Jones, 2013 WL 6728951, at *23 (“Even when liberally construed, [this claim] is devoid of
factual content. Apart from ‘reiterating each and every allegation’ contained in preceding
paragraphs, [the plaintiff] merely asserts that ‘Defendants intentionally interfered with the
business relations and prospective advantage of the Plaintiff through their actions.’”).
Accordingly, the Motion [#6] is granted to the extent Defendant seeks dismissal of
Plaintiff’s claim of intentional interference with prospective business relations, and this claim
is dismissed without prejudice. See, e.g., Preece v. Cooke, No. 13-cv-03265-REB-KLM,
2014 WL 6440406, at *1 (D. Colo. Nov. 17, 2014) (stating that “[a] dismissal under Rule
12(b)(6) is a determination on the merits . . . and presumptively is entered with prejudice,”
but that a case presenting “a scenario in which . . . [the plaintiff] might be able to replead
to state a viable claim if the facts were made clearer or expanded in some way” may be a
candidate for dismissal without prejudice).
For the foregoing reasons, the Motion [#6] is GRANTED in part and DENIED in
part. The Motion is granted to the extent that Plaintiff’s claim of intentional interference
with prospective business relations is DISMISSED without prejudice. The Motion is
DENIED to the extent it seeks dismissal of Plaintiff’s claims under the ADEA and CADA.
Dated October 23, 2015, at Denver, Colorado.
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