Terhune v. Board of Education of Zion Elementary School Distric 6 et al

Filing 25

MEMORANDUM Opinion Signed by the Honorable Samuel Der-Yeghiayan on 2/20/2013: Mailed notice (mw, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
RICHARD TERHUNE,

)
)
Plaintiff,
)
)
v.
)
)
THE BOARD OF EDUCATION OF ZION)
ELEMENTARY SCHOOL DISTRICT 6, )
et al.,
)
)
Defendants.
)

No. 12 C 7865

MEMORANDUM OPINION
SAMUEL DER-YEGHIAYAN, District Judge
This matter is before the court on Defendants’ motion to dismiss and motion to
strike. For the reasons stated below, the motion to dismiss is granted in part denied
in part and the motion to strike is stricken as moot.

BACKGROUND
Plaintiff Richard Terhune (Terhune) alleges that he was hired by Defendant
The Board of Education of Zion Elementary School District 6 (Board) in 2005 as an
Assistant Superintendent of Business Services for one-year renewable contracts.

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Terhune contends that he reported directly to Defendant John Ahlgrim (Ahlgrim), the
Superintendent of Zion Elementary School District 6 (District). Terhune claims that
he acquired tenure in 2009. According to Terhune, each year his employment
contract was renewed until the contract for the 2011-12 school year. Terhune claims
that Ahlgrim, in an attempt to justify not renewing Terhune’s contract, falsely alleged
performance deficiencies by Terhune. Ahlgrim allegedly recommended to the Board
that Terhune’s contract not be renewed. Subsequently, Terhune allegedly requested
that he be reassigned to a classroom for the 2011-12 school year, but Ahlgrim
suggested that Terhune take a new administrator position instead of being reassigned
to the classroom. Terhune contends that, as a tenured teacher, he was entitled to a
reassignment in a classroom position as a physical education teacher. On March 21,
2011, the Board allegedly issued to Terhune a notice of non-renewal, informing him
that due to a reduction in force (RIF), he would not be re-employed for the 2011-12
school year. Terhune contends that he was the only employee subjected to the RIF
and that such action violated the seniority rights provided in the school code.
Terhune brought the instant action and includes in his complaint an age
discrimination claim brought against the Board pursuant to the Age Discrimination in
Employment Act (ADEA), 29 U.S.C. § 621 et seq. (Count I), a tortious interference
with contract claim brought against Ahlgrim (Count II), a tortious interference with

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prospective economic advantage claim brought against Ahlgrim (Count III),
retaliatory discharge claims brought against Ahlgrim and the Board (Count IV), and
claims brought against Ahlgrim and the Board pursuant to 42 U.S.C. § 1983 (Section
1983), alleging a violation of Terhune’s due process rights (Count V). Defendants
move to dismiss the claims in the complaint and move to strike certain portions of
the complaint.

LEGAL STANDARD
In ruling on a motion to dismiss brought pursuant to Federal Rule of Civil
Procedure 12(b)(6) (Rule 12(b)(6)), the court must draw all reasonable inferences
that favor the plaintiff, construe the allegations of the complaint in the light most
favorable to the plaintiff, and accept as true all well-pleaded facts and allegations in
the complaint. Appert v. Morgan Stanley Dean Witter, Inc., 673 F.3d 609, 622 (7th
Cir. 2012); Thompson v. Ill. Dep’t of Prof’l Regulation, 300 F.3d 750, 753 (7th Cir.
2002). A plaintiff is required to include allegations in the complaint that “plausibly
suggest that the plaintiff has a right to relief, raising that possibility above a
‘speculative level’” and “if they do not, the plaintiff pleads itself out of court.”
E.E.O.C. v. Concentra Health Services, Inc., 496 F.3d 773, 776 (7th Cir.
2007)(quoting in part Bell Atlantic Corp. v. Twombly, 127 S.Ct. 1955, 1965 (2007));

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see also Morgan Stanley Dean Witter, Inc., 673 F.3d at 622 (stating that “[t]o survive
a motion to dismiss, the complaint must contain sufficient factual matter, accepted as
true, to state a claim to relief that is plausible on its face,” and that “[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”)(quoting Ashcroft v. Iqbal, 556 U.S. 662 (2009))(internal quotations
omitted). Pursuant to Federal Rule of Civil Procedure 12(f), “[t]he court may strike
from a pleading an insufficient defense or any redundant, immaterial, impertinent, or
scandalous matter.” Fed. R. Civ. P. 12(f).

DISCUSSION
I. ADEA Claim (Count I)
Defendants argue that Terhune has not presented sufficient facts to state a
valid ADEA claim. Defendants contend that the court should dismiss the ADEA
claim because Terhune has not pled facts for a prima facie case under the McDonnell
Douglas burden-shifting method. (Mot. 3); (Reply 2). However, the McDonellDouglas burden-shifting method is applied at the summary judgment stage, not at the
pleading stage. Swierkiewicz v. Sorema N. A., 534 U.S. 506, 510-11 (2002). The
Supreme Court has explained in an ADEA case that “[t]he prima facie case under

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McDonnell Douglas . . . is an evidentiary standard, not a pleading requirement,” and
that the “Court has never indicated that the requirements for establishing a prima
facie case under McDonnell Douglas also apply to the pleading standard that
plaintiffs must satisfy in order to survive a motion to dismiss.” Id. In fact, in the
opinion cited by Defendants in support of the proposition that a plaintiff must plead a
prima facie case in the complaint to defeat a motion to dismiss, the Seventh Circuit
was reviewing a ruling by the district court granting the defendant’s motion for
summary judgment, not a motion to dismiss. Atanus v. Perry, 520 F.3d 662, 666-67,
670-71 (7th Cir. 2008).
Although Terhune does not have to establish a prima facie case, as indicated
above, he still must allege sufficient facts to plausibly suggest that he was
discriminated against because of his age. Terhune’s own allegations indicate that
while he was over 50, he worked for the District and that the Board renewed his
contract for five straight years, and that he received a pay increase each year.
(Compl. Par. 7, 9, 15, 16, 17). Terhune also alleges that Ahlgrim offered to place
Terhune in an administrator position if the Board did not decide to renew his contract
for the 2011-12 school year. (Compl. Par. 59). Such actions do not suggest that the
Board had an animus against Terhune because of his age.
Terhune also lays out in his complaint an extensive series of allegations

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relating to Terhune’s involvement with a contract for technology services (Net56
Contract). Terhune contends that “he spoke to [Ahlgrim] about [his] concerns
regarding the Net56 contract,” which led to an audit, and to a significant loss of
funds to the District. (Compl. Par. 31-35). Terhune alleges that after his expression
of concern regarding the Net56 Contract led to the financial loss to the District, “[i]n
Terhune’s evaluation, Superintendent Ahlgrim discussed the Net56 contract at
length, blaming Terhune for problems with the contract and services.” (Compl. Par.
40). Terhune further alleges that Ahlgrim’s accusations” relating to the Net56
Contract “were false and that Ahlgrim “intentionally used [the] allegations to deflect
blame for the New56 problem.” (Compl. Par. 40). It is the unsatisfactory
performance evaluation that Terhune contends then led to other false statements
about his performance and ultimately led to the non-renewal of his contract and the
notice of the RIF. Thus, Terhune’s own allegations, which the court must accept as
true at this stage of the proceedings, suggest that adverse actions were allegedly
taken against him by Defendants based on an animus relating to the Net56 Contract,
not based on an animus against Terhune because of his age. Based on the above,
Terhune has failed to present allegations that plausibly suggest that he was
discriminated against because of his age. Therefore, Defendants’ motion to dismiss
the ADEA claim is granted.

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II. Tortious Interference with Contract Claim (Count II)
Defendants argue that Terhune has failed to allege facts to state a tortious
interference with contract claim. For a tortious interference with contract claim
brought under Illinois law, a plaintiff must establish: (1) “that he had a valid and
enforceable contract with” a party, (2) that the defendant “was aware of the
contractual relationship” with the party, (3) that the defendant “intentionally and
without justification induced [the party] to breach the contract,” (4) that “the
subsequent breach was caused by” the defendant, and (5) that the plaintiff “sustained
damages.” Nation v. American Capital, Ltd., 682 F.3d 648, 651 (7th Cir. 2012).

A. Breach of Contractual Obligation
Defendants argue that Terhune does not allege facts that suggest that the terms
of any contract he entered into with the Board were breached by the Board.

1. Renewable Written Contract
Terhune argues that Ahlgrim interfered with the renewal of his contract as an
Assistant Superintendent for the 2011-12 school year. However, as Defendants
correctly point out, according to Terhune’s own pleadings, he entered into a new

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contract for the Assistant Superintendent position with the Board each year.
Terhune’s own allegations indicate that he never entered into a contract with the
Board for the 2011-12 school year for the Assistant Superintendent position. Thus,
Ahlgrim could not have interfered with a contractual relationship that never existed.
Nor are there allegations that the Board breached any term of any contract it entered
into with Terhune in regard to the Assistant Superintendent position.

2. Reduction in Force
Terhune also argues that he had a right to be reassigned to a class room
teaching position. Terhune alleges that the RIF violated Terhune’s seniority rights
set forth in 105 ILCS 5/24-12. (Compl. Par. 68). However, Terhune does not offer
facts to suggest that the statutory rights identified by Terhune were part of a written
contract with the Board. Terhune’s argument concerning the RIF fails to relate to a
contractual relationship that would support a tortious interference with contract
claim.

3. Future Expectations
Terhune also argues in his response to the instant motion that he “had an
enforceable expectation of contract renewals and continued employment with the”

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Board. (Ans. 7). However, according to Terhune’s own allegations, at the end of the
2010-11 school year when his contract expired, he became an at-will employee. The
allegations concerning Terhune’s future expectations and Ahlgrim’s alleged
interference with the future relationship between Terhune and the Board would only
be relevant to the tortious interference with prospective economic advantage claim,
not the tortious interference with contract claim. See Del Monte Fresh Produce,
N.A., Inc. v. Kinnavy, 2010 WL 1172565, at *2 (N.D. Ill. 2010)(stating that “under
Illinois law, an action for tortious interference with a contract that is terminable at
will is properly classified as a claim of intentional interference with prospective
economic advantage”).

B. Inducement to Breach Contractual Obligations
Terhune contends that Ahlgrim “intentionally induc[ed] the Board to not
renew its contract with” Terhune. (Ans. 9). Terhune also alleges that Ahlgrim
“falsely alleged performance deficiencies as the reason for not renewing his
contract,” and that Ahlgrim told Terhune that if he did not accept a position as an
administrator, Ahlgrim would “remove Terhune through a reduction-in-force.”
(Compl. Par. 59). Terhune does not, however, allege facts that suggest that Ahlgrim
somehow misled or persuaded the Board that Terhune had a poor work performance

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or that the RIF was appropriate. Instead, Terhune alleges that the Board was fully
aware that Ahlgrim allegedly gave false reasons for recommending that Terhune’s
contract not be renewed and that in “[i]mposing the RIF, the Board knowingly
violated Terhune’s seniority rights. . . .” (Compl. Par. 47, 68). Such facts do not
suggest that Ahlgrim induced the Board to breach any contractual rights.

C. Third Party
Defendants argue that Terhune has failed to state a tortious interference with
contract claim because Ahlgrim is an agent of the Board. Generally, a tortious
interference with contract claim will not stand against an agent of the third party that
has formed the contractual relationship with the plaintiff unless the agent was acting
solely in his own self interests. See Muthuswamy v. Burke, 646 N.E.2d 616, 621 (Ill.
App. Ct. 1993)(stating that “[a] corporate employee will not be liable for wrongful
interference where he is acting on behalf of the interests of the employer”). Terhune
alleges facts that suggest that Ahlgrim was an agent of the Board. Terhune argues in
response to the instant motion in a conclusory fashion that, although Ahlgrim was an
agent of the Board, Ahlgrim was acting in his own self interests “and against the
interests” of the his employer, and that Ahlgrim was therefore acting outside the
scope of his employment. (Ans. 8). However, as indicated above, Terhune’s own

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allegations state that the Board was fully aware that the poor performance reviews
may not have been justified and that the RIF may have been improper. In spite of
such knowledge, the Board allegedly decided not to renew Terhune’s contract and to
approve the RIF. Thus, Terhune has not alleged facts that suggest that Ahlgrim was
acting against the interests of his employer. Therefore, based on the above,
Defendants’ motion to dismiss the tortious interference with contract claim (Count
II) is granted.

III. Tortious Interference with Prospective Economic Advantage Claim (Count III)
Defendants argue that Terhune has failed to allege sufficient facts to state a
tortious interference with prospective economic advantage claim. For a tortious
interference with prospective economic advantage claim brought under Illinois law, a
plaintiff must establish: (1) “a reasonable expectancy of entering into a valid
business relationship,” (2) “the defendant’s knowledge of the expectancy,” (3) “an
intentional and unjustified interference by the defendant that induced or caused a
breach or termination of the expectancy,” and (4) “damage to the plaintiff resulting
from the defendant’s interference.” Borsellino v. Goldman Sachs Group, Inc., 477
F.3d 502, 508 (7th Cir. 2007)(quoting Voyles v. Sandia Mortgage Corp., 751 N.E.2d
1126, 1133-34 (Ill. 2001)(internal quotations omitted); Botvinick v. Rush University

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Medical Center, 574 F.3d 414, 417 (7th Cir. 2009)(same).
Terhune argues that because of his status in the school and because his prior
contracts had been routinely renewed, he had a reasonable expectation of future
employment with the Board. Terhune further contends that Ahlgrim falsely
represented that Terhune’s work performance was poor in order to prevent the
fruition of what otherwise would have been a new one-year contractual relationship
between Terhune and the Board. However, as indicated above, Terhune’s own
allegations state that the Board knew that Ahlgrim allegedly gave false reasons to
support his recommendation that Terhune’s contract not be renewed, and further
knew that the RIF may have been improper. Thus, according to Terhune’s own
allegations, Ahlgrim’s alleged conduct did not prevent a contract from forming
between Terhune and the Board that otherwise would have formed. In addition, as
explained above in regard to the tortious interference with contract claim, the
allegations suggest that Ahlgrim was an agent of the Board, acting in the interests of
the Board instead of a third party. Therefore, Defendants’ motion to dismiss the
tortious interference with prospective economic advantage claim (Count III) is
granted.

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IV. Retaliatory Discharge Claims (Count IV)
Defendants argue that Terhune has not alleged sufficient facts to state a valid
retaliatory discharge claim. For a retaliatory discharge claim brought under Illinois
law, a plaintiff must establish: (1) that the plaintiff was “discharged,” (2) that the
plaintiff was discharged “in retaliation for h[is] activities,” and (3) that “the
discharge violated a clear mandate of public policy.” Redd v. Nolan, 663 F.3d 287,
295 (7th Cir. 2011). In the instant action, Terhune does not allege facts that indicate
that he was discharged from his employment. Terhune alleges that he entered into a
one-year contract for the 2010-11 school year and does not allege that he was
discharged prior to the term of that contract. Terhune also alleges that he received
the notice of the RIF and that he was not given a position for the 2011-12 school
year. Terhune’s allegations reflect that even after Ahlgrim recommended to the
Board that Terhune’s contract not be renewed, Ahlgrim suggested that Terhune take
an administrator position, but Terhune chose not to take the offer. Based on all of
the above, Terhune has not alleged facts that suggest that he was discharged or that
the discharge was in retaliation for any protected activity. Terhune has also failed to
allege a discharge in violation of a clear mandate of public policy. Although
Terhune contends that he made certain objections relating to the handling of the
Net56 Contract, the allegations indicate that Terhune was merely acting in his role as

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the Assistant Superintendent of Business Services. Nothing indicates that Terhune
was speaking out on a matter of public concern. An internal dispute on how certain
contract matters should be handled by the District does not raise concerns relating to
the violation of a clear mandate of public policy. Therefore, based on the above,
Defendants’ motion to dismiss the retaliatory discharge claims (Count IV) is granted.

V. Due Process Claim (Count V)
Defendants argue that Terhune has not named the proper Defendant for the
due process claim (Count V). Defendants argue that Terhune specifically seeks relief
on his due process claim against the District, which is not a defendant in this case.
Defendants argue that the due process claim must be dismissed because Terhune is
seeking relief from a non-party. Terhune indicates that he named the Board as a
Defendant since it is the governing body of the District. Defendants correctly point
out that Terhune seeks relief in Count V for alleged constitutional violations caused
by the District. (Compl. Par. 127). However, the body of Count V clearly indicates
that he is seeking relief against the Board, when Terhune indicates that the Board
deprived Terhune of his property right. (Compl. Par. 120). Terhune claims that he is
a tenured teacher and that he was denied his various rights as a tenured teacher in
violation of his due process rights. Even though the allegations by Terhune indicate

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that he was employed as an administrator, and not a teacher, since at the pleadings
stage, the court must accept as true Terhune’s allegations, Terhune has presented
sufficient allegations for his due process claim at this juncture. At the summary
judgment stage, Terhune will need to point to sufficient evidence to support his due
process claim and cannot rely on allegations. Therefore, Defendants’ motion to
dismiss the due process claim (Count V) is denied.

CONCLUSION
Based on the foregoing analysis, Defendants’ motion to dismiss Counts I, II,
III, and IV are granted and Defendants’ motion to dismiss Count V is denied.
Defendants’ motion to strike is stricken as moot.

___________________________________
Samuel Der-Yeghiayan
United States District Court Judge
Dated: February 20, 2013

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