The Variable Annuity Life Insurance Company (Valic) v. Laeng

Filing 52

ORDER denying 50 Motion in Limine. Signed by Judge Virginia M. Hernandez Covington on 8/2/2013. (CH)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF FLORIDA
TAMPA DIVISION
THE VARIABLE ANNUITY LIFE
INSURANCE COMPANY (VALIC),
Plaintiff,
v.

Case No. 8:12-cv-2280-T-33MAP

FAWN LAENG,
Defendant.
_______________________________/
ORDER
This cause comes before the Court in consideration of
Plaintiff

VALIC’s

Motion

in

Limine.

(Doc.

#

50).

Defendant Fawn Laeng filed a response in opposition to the
Motion on July 26, 2013.

(Doc. # 51).

For the reasons

that follow, the Motion is denied.
I.

Background
VALIC is a Texas corporation that markets financial

services to tax exempt organizations.
8).

(Doc. # 1 at ¶¶ 1,

Laeng is a former employee of VALIC.

(Id. at ¶ 2).

As a condition of employment with VALIC, Laeng was required
to

execute

a

“Registered

VALIC Financial Advisors.

Representative
(Id. at ¶ 25).

Agreement”

with

Pursuant to the

Agreement, “[i]n consideration of [Laeng’s] access to VALIC
trade

secrets,

proprietary

and

confidential

information

such as the customer base developed by VALIC and the other
benefits

and

opportunities

provided

to

her

by

VALIC,

[Laeng] promised that she would not disclose trade secrets
[or confidential and proprietary information] during the
term

of

the

termination.”

agreement

or

at

any

time

after

its

(Id. at ¶¶ 28-29).

Additionally,

Laeng

“agreed

to

a

non-solicitation

provision, promising for one year after leaving employment
not

to

solicit

business

from

VALIC

customers

who

were

within [Laeng’s] assigned territories and assigned to her
during the one year preceding her departure[.]”
31).

(Id. at ¶

Importantly, this provision does not prohibit Laeng

from competing with VALIC upon departure; VALIC describes
the non-solicitation provision as “very reasonable” in that
it permits Laeng “to work for a VALIC competitor [and sell]
competing products in the same region she worked before her
resignation.”

(Doc. # 5 at 2).

Laeng left VALIC on July 11, 2012, and began working
at LPL Financial, one of VALIC’s local competitors, the
next day.

(Doc. # 1 at ¶ 2).

VALIC alleges that Laeng is

“soliciting and attempting to solicit VALIC’s clients, and
otherwise improperly competing against VALIC in violation
of

the

restrictive

covenants
2

in

[Laeng’s]

employment

agreement.”
actions

(Id.).

“have

VALIC

resulted

further

in

more

claims

than

that

Laeng’s

$629,113.32

being

removed from the VALIC accounts of her former clients and
moved to accounts brokered by LPL Financial . . . .”

(Id.

at ¶ 6).
On

October

5,

2012,

VALIC

filed

the

operative

Complaint against Laeng, alleging five causes of action:
(1)

Misappropriation

Confidential

and

of

VALIC

Proprietary

Trade

Information;

Secrets
(2)

and

Breach

of

Contract; (3) Intentional Interference with Existing and
Prospective

Business

Relations;

(4)

Loyalty; and (5) Unjust Enrichment.

Breach

of

Duty

of

(Doc. # 1).

Also on October 5, 2012, VALIC filed a Motion for
Preliminary Injunction, alleging that Laeng was “actively
soliciting
accounts

her
away

former
from

VALIC
VALIC”

solicitation agreement.
VALIC’s

Motion

for

customers
in

transfer

violation

(Doc. # 5).

Preliminary

to

of

her

their
non-

Among other requests,

Injunction

sought

the

Court’s issuance of an order enjoining Laeng from “directly
or

indirectly

proprietary

disseminating

information

[and

VALIC’s
trade

confidential

secrets],”

and

and
also

prohibiting Laeng from “attempting to induce any Protected

3

Customer to end or alter his or [her] relationship with
VALIC . . . for a period of one year[.]”
This

Court

referred

the

(Id. at 15-16).

Motion

for

Preliminary

Injunction to Judge Pizzo for the issuance of a Report and
Recommendation.

(Doc. # 7).

Judge Pizzo held a hearing on

the Motion for Preliminary Injunction on November 16, 2012.
(Doc.

#

24).

On

January

2,

2013,

after

examining

the

evidence against the touchstone of Rule 65 of the Federal
Rules of Civil Procedure, Judge Pizzo entered a detailed
Report and Recommendation (Doc. # 28), finding that the
Motion for Preliminary Injunction should be denied.

On

February 11, 2013, this Court entered an Order accepting
and adopting Judge Pizzo’s Report and Recommendation to the
extent it found that VALIC had failed to demonstrate a
substantial likelihood of success on the merits.

(Doc. #

37).
On March 20, 2013, Laeng filed a counterclaim, with
leave of Court, in which Laeng accuses VALIC of (1) Sex
Discrimination and Harassment under Title VII; (2) Title
VII

Retaliation;

(3)

Sex

Discrimination

and

Harassment

under the Florida Civil Rights Act of 1992; (4) Retaliation
under

the

Supervision.

FCRA;

and

(5)

(Doc. # 42).
4

Negligent

Retention

and

In accordance with the Case Management and Scheduling
Order

(Doc.

#

27),

entered

on

December

19,

2012,

the

deadline for dispositive motions in this case was scheduled
for

June

14,

2013.

The

discovery

deadline,

initially

scheduled for May 10, 2013, was subsequently extended by
separate Order to August 30, 2013, in response to a joint
motion for extension by the parties, in which the parties
acknowledged and agreed that “any discovery conducted after
the

dispositive

motions

date

summary judgment purposes.”

will

not

be

available

for

(Doc. # 44 at 2-3).

Neither party filed a motion for summary judgment on
or before the deadline imposed by the Case Management and
Scheduling

Order.

On

July

instant Motion in Limine.

12,

2013,

(Doc. # 50).

VALIC

filed

the

Laeng filed a

response in opposition to the Motion on July 26, 2013.
(Doc. # 51).
the

The Court has carefully reviewed the Motion,

response,

and

is

otherwise

fully

advised

in

the

issue

of

premises.
II.

Legal Standard
“A

motion

in

limine

presents

a

pretrial

admissibility of evidence that is likely to arise at trial,
and as such, the order, like any other interlocutory order,
remains subject to reconsideration by the court throughout
5

the trial.”

In re Seroquel Prods. Liability Litigation,

Nos. 6:06-md-1769-Orl-22DAB, 6:07-cv-15733-Orl-22DAB, 2009
WL 260989, at *1 (M.D. Fla. Feb. 4, 2009).

“The real

purpose of a motion in limine is to give the trial judge
notice

of

the

movant’s

position

so

as

to

avoid

the

introduction of damaging evidence which may irretrievably
[a]ffect the fairness of the trial.

A court has the power

to exclude evidence in limine only when evidence is clearly
inadmissible

on

all

potential

grounds.”

Id.

(internal

quotation omitted).
A

motion

in

limine

is

not

the

proper

vehicle

to

resolve substantive issues, to test issues of law, or to
address or narrow the issues to be tried.

See LSQ Funding

Grp. v. EDS Field Servs., 879 F. Supp. 2d 1320, 1337 (M.D.
Fla. 2012) (citing Royal Indem. Co. v. Liberty Mut. Fire
Ins. Co., No. 07-80172-CIV, 2008 WL 2323900, at *1 (S.D.
Fla. June 5, 2008)).
The district court has broad discretion to determine
the admissibility of evidence, and the appellate court will
not disturb this Court’s judgment absent a clear abuse of
discretion.

United States v. McLean, 138 F.3d 1398, 1403

(11th Cir. 1998); see also United States v. Jernigan, 341
F.3d

1273,

1285

(11th

Cir.
6

2003)

(“Inherent

in

this

standard is the firm recognition that there are difficult
evidentiary rulings that turn on matters uniquely within
the purview of the district court, which has first-hand
access to documentary evidence and is physically proximate
to testifying witnesses and the jury.”).
III. Analysis
A.

Standing and Material Breach

VALIC argues that “the Court should preclude Defendant
from presenting evidence or otherwise eliciting testimony
that

VALIC

[Registered

is

not

a

third

beneficiary

Agreement]

or

to

the

that

VALIC

otherwise lacks standing to enforce the Agreement.”

(Doc.

# 50 at 3).

Representative

party

Additionally, VALIC argues that “Laeng should

be precluded from arguing that her allegations of sexual
harassment

constitute

or

potentially

constitute

a

prior

material breach of the [Agreement],” because “[n]o Florida
court

has

held

that

allegations

of

sexual

harassment

constitute a material breach of the contract sufficient to
negate a contract’s restrictive covenants.”

(Id. at 4-5).

The Court finds VALIC’s arguments regarding standing
and breach to be nothing more than disguised bases for a
summary judgment motion, which is improper at this juncture

7

of the proceedings.1

The Case Management and Scheduling

Order in this case imposed a dispositive motions deadline
of June 14, 2013.
file

a

motion

(Doc. # 27).

for

summary

Neither party opted to

judgment

on

or

before

the

deadline, and the Court is not inclined to entertain a
motion in limine seeking resolution of arguments suitably
raised

in

a

summary

judgment

motion.

Accordingly,

the

Motion in Limine is denied as to the issues of standing and
material breach.
B.

FINRA

VALIC

“anticipates

Defendant

Laeng

will

seek

to

introduce evidence regarding [Financial Industry Regulatory
Authority, Inc.] rules and regulations, including without
limitation (a) that the Registered Representative Agreement
violates FINRA regulations and is therefore illegal; (b)
that Defendant’s conduct does not violate FINRA rules or
regulations;

or

(c)

that

rules or regulations.”

VALIC’s

conduct

(Doc. # 50 at 2).

1

violates

FINRA

VALIC argues

Notably, VALIC does not cite a single Federal Rule of
Evidence to support its argument that evidence relating to
the issues of standing and material breach should be
excluded as inadmissible at trial, and, with the exception
of the FINRA Rules discussed herein, VALIC neglects to
describe any particular items of evidence VALIC seeks to
exclude. It is thus apparent to the Court that the relief
VALIC seeks in this Motion exceeds the proper scope of a
motion in limine.
8

that “evidence regarding FINRA rules or regulations should
be precluded here because VALIC is not a FINRA member and
its rules are not applicable to VALIC,” thus rendering such
evidence “irrelevant to this case.”
addition

to

being

irrelevant,

VALIC

(Id. at 2-3).
argues

that

In
this

evidence would be “highly prejudicial to VALIC and will
potentially confuse the jury by suggesting that VALIC is
bound by rules or regulations” that are not controlling.
(Id. at 3).
In response to VALIC’s contention that evidence of the
FINRA rules should be excluded, Laeng argues that VALIC’s
Motion should be denied because:
(1) VALIC claims third party beneficiary status
pursuant to a contract where the named parties to
the contract are subject to FINRA Rules; (2) at
least one court previously held VALIC is subject
to FINRA Rules when VALIC raised the same
arguments; (3) VALIC fails to recognize and
acknowledge certain clients for which VALIC seeks
damages had accounts with both VALIC and VALIC
Financial Advisors, Inc. (“VFA”)[;] (4) the
Motion is premature because discovery remains
open until August 30, 2013[;] and (5) VALIC’s
counsel failed to confer with Laeng’s counsel
prior to filing its Motion, as required by Local
Rule
3.01(g)
and
the
Case
Management
and
Scheduling Order.
(Doc. # 51 at 1-2).
Because the relevance -- and thus the admissibility -of the FINRA rules appears to be related to the issue of
9

VALIC’s standing as a purported third party beneficiary to
the subject Agreement, the Court declines to determine the
admissibility of those rules at this time.

As explained

above, a motion in limine is not the proper vehicle to
resolve substantive issues, to test issues of law, or to
address or narrow the issues to be tried.
IV.

Local Rule 3.01(g) Certification
In

addition

to

improperly

presenting

substantive

issues, VALIC’s Motion is defective in that it lacks the
certification required by Local Rule 3.01(g).

That rule

requires a moving party to “confer with counsel for the
opposing party in a good faith effort to resolve the issues
raised

by

the

motion,”

and

statement

(1)

certifying

conferred

with

opposing

to

that

counsel

“file

with

the

moving

and

(2)

the

motion

counsel

stating

counsel agree on the resolution of the motion.”

a

has

whether
In light

of this defect, combined with the problems noted above, the
Court denies VALIC’s Motion in Limine.
Accordingly, it is
ORDERED, ADJUDGED, and DECREED:
VALIC’s Motion in Limine (Doc. # 50) is DENIED.
DONE and ORDERED in Chambers in Tampa, Florida, this
2nd day of August, 2013.
10

Copies: All Counsel of Record

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