ALLSTATE LIFE INSURANCE COMPANY v. STILLWELL et al

Filing 120

OPINION filed. Signed by Judge Anne E. Thompson on 7/24/2019. (km)

NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

ALLSTATE LIFE INSURANCE
COMPANY,
Civ. No. 15-8251
Plaintiff,
OPINION
v.
JEFFREY STILLWELL, STILLWELL
FINANCIAL ADVISORS, LLC, and
THERESA FRANCY,
Defendants.
JEFFREY STILLWELL,
Counter Claimant,
v.
ALLSTATE LIFE INSURANCE
COMPANY,
Counter Defendant.
THOMPSON, U.S.D.J.
INTRODUCTION
This matter comes before the Court upon the Motion for Reconsideration filed by
Defendants Jeffrey Stillwell; Stillwell Financial Advisors, LLC (“SFA”); and Theresa Francy
(collectively, “Defendants”). (ECF No. 114.) Plaintiff Allstate Life Insurance Company
(“Plaintiff”) opposes. (ECF No. 118.) The Court has decided the Motion on the written
submissions of the parties, pursuant to Local Rule 78.1(b). For the reasons stated herein, the
Motion for Reconsideration is denied.

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BACKGROUND
The facts of this case are familiar to the parties and will not be fully recited here. (See Op.
at 2–13, ECF No. 112 (providing extensive factual background).) Plaintiff is a life insurance
company for whom Defendants Stillwell and Francy previously worked. (Id. at 2.) In September
2015, Defendants Stillwell and Francy terminated their relationship with Plaintiff and began
working at Defendant SFA. (Id. at 5.) Plaintiff accuses Defendants of breaching their noncompete and non-solicitation agreements, misusing confidential information after their
termination, and refusing to return money owed. (See id. at 5–13.) Defendant Stillwell filed
Counterclaims accusing Plaintiff of, among other things, withholding money owed to him. (Id. at
2, 11–13; see also Answer & Countercls. at 23–27, ECF No. 9.)
On May 16, 2019, the Court granted in part and denied in part the parties’ Motions for
Summary Judgment. (See Op. at 14–28; Order & J., ECF No. 113.) On May 30, 2019,
Defendants filed the present Motion for Reconsideration of the Court’s Summary Judgment
Opinion and Order. (ECF No. 114.) After receiving extensions of time (ECF Nos. 115–16),
Plaintiff opposed the Motion on July 8, 2019 (ECF No. 118), and Defendants replied on July 15,
2019 (ECF No. 119). The Motion is presently before the Court.
LEGAL STANDARD
“The purpose of a motion for reconsideration is to correct manifest errors of law or fact
or to present newly discovered evidence.” Harsco Corp. v. Zlotnicki, 779 F.2d 906 (3d Cir.
1985). Reconsideration is an extraordinary remedy that is to be granted “very sparingly.” E.g.,
Friedman v. Bank of Am., N.A., No. 09-2214, 2012 WL 3146875, at *2 (D.N.J. Aug. 1, 2012).
Filed pursuant to Rule 59(e) of the Federal Rules of Civil Procedure and Local Civil Rule 7.1(i),
a motion for reconsideration may be based on one of three separate grounds: (1) an intervening
change in controlling law, (2) new evidence not previously available, or (3) to correct a clear
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error of law or to prevent manifest injustice. N. River Ins. Co. v. CIGNA Reins. Co., 52 F.3d
1194, 1218 (3d Cir. 1995) (internal citation omitted).
A motion for reconsideration is not an opportunity to raise new matters or arguments that
could have been raised before the original decision was made. E.g., Bowers v. NCAA, 130 F.
Supp. 2d 610, 613 (D.N.J. 2001). Nor is it an opportunity to ask the Court to rethink what it has
already thought through. E.g., Oritani S & L v. Fidelity & Deposit, 744 F. Supp. 1311, 1314
(D.N.J. 1990). Rather, a motion for reconsideration may be granted only if there is a dispositive
factual or legal matter that was presented but not considered that would have reasonably resulted
in a different conclusion by the court. E.g., Champion Labs., Inc. v. Metex Corp., 677 F. Supp.
2d 748, 750 (D.N.J. 2010). “Mere disagreement with a court’s decision normally should be
raised through the appellate process and is inappropriate on a motion for reargument.” United
States v. Compaction Sys. Corp., 88 F. Supp. 2d 339, 345 (D.N.J. 1999).
DISCUSSION
Defendants seek reconsideration based on several alleged instances of clear error by the
Court. First, Defendants argue that summary judgment in favor of Plaintiff on Count II (a breach
of contract claim based on a bonus payment) was improper because Plaintiff never moved for
summary judgment on that Count. (Mot. Recons. at 4–5.) In a formal sense, Plaintiff did move
for summary judgment on this Count. (See Pl.’s Summ. J. Mot. at 2, ECF No. 85 (“Plaintiff . . .
moves for partial summary judgment as to liability on its claims against Defendants Jeffrey
Stillwell . . . for breach of contract . . . .”).) Although Plaintiff did not provide any argument for
summary judgment on Count II in its moving brief, the claim involves the same subject matter as
Defendant Stillwell’s Counterclaim (Op. at 18), and the parties did extensively argue the
Counterclaim (see Defs.’ Summ. J. Mot. at 36–39, ECF No. 89-5; Pl.’s Summ. J. Opp’n at 29–
32, ECF No. 100; Defs.’ Summ. J. Reply at 3–6, ECF No. 110). Count II was litigated in both
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form and substance, and a finding of summary judgment on that Count was proper.
Defendants also claim that the Court granted summary judgment on Count II “on grounds
not raised by a party” without “giving notice and a reasonable time to respond” as required by
Rule 56(f)(2) of the Federal Rules of Civil Procedure. The Court, interpreting Section 4.2 of the
Supplement to an agreement between Plaintiff and Defendant Stillwell, found that,
Defendant Stillwell was entitled to the LPB [Life Production Bonus] payment
only if he was active at the end of the bonus period. The bonus period ended at the
end of 2015, after Defendant Stillwell had terminated. Therefore, Defendant
Stillwell was not entitled to the LPB payment and is required to repay it.
(Op. at 26.) Defendants, in their Motion for Reconsideration, state that Plaintiff “[n]ever ma[d]e
the argument, ultimately adopted by the Court, that Stillwell was not entitled to retain the
Accelerated LPB because Section 4.2 of the Supplement states that the ‘EFS must be active at
the end of the bonus period to receive credit for that period.’” (Mot. Recons. at 5.) At the time of
their Summary Judgment Motion, however, Defendants had a different view: “[Plaintiff] ALIC
relies on Sections 4.2 and 4.3 of the Supplement and Section XV.C of the EFS Agreement its
position [sic].” (Defs.’ Summ. J. Mot. 38.) Moreover, Defendants themselves cited to the
relevant contract language (Pl.’s Stmt. of Material Facts ¶ 120, ECF No. 89-1) and argued in
their Motion for Summary Judgment for their preferred reading of the contract (Defs.’ Summ. J.
Mot. at 38–39). This is not the kind of situation contemplated by Rule 56(f)(2) where a party had
summary judgment sprung upon it without the opportunity to argue its side of the case.
LPB benefits accrue from credits earned over time. (See Supplement § 4.2, ECF No. 89-2
(Tab 10).) Defendants argue that Defendant Stillwell’s LPB bonus for the 2015 bonus period was
based entirely on credits earned in 2014, and since Defendant Stillwell left Plaintiff in 2015 he
was active at the end of the bonus period in 2014, entitling him to the LPB. (Mot. Recons. at 5–
8.) The issue here is how to define the “bonus period” and when it ends. The contract does not
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define the term, but it does provide language lending plausibility to the Court’s original ruling
that the bonus period ended at the end of 2015, when Defendant Stillwell was no longer active.
(Supplement §§ 4.1 (“Qualification for the Life Production Bonus credits is based on current
year net production credit . . . .”), 4.2 (“In January of the following year, 25% of the accumulated
credits are paid out in an annual bonus. The bonus will be paid each year there is a credit
balance, even if an EFS [Exclusive Financial Specialist] does not qualify for additional bonus
credits in that calendar year.”).) The Court’s determination was therefore not clear error. 1
Next, Defendants claim that the Court erred by assuming that a list of client contact
information (the “Database List”) came from Plaintiff’s database. (Mot. Recons. at 8–12; see Op.
at 7.) At summary judgment, Plaintiff represented to the Court that the Database List was
“generated from [Plaintiff’s] database.” (Resp. to Defs.’ SMF ¶¶ 65, 67.) Defendants did not
contest that statement at the time (see Defs.’ Reply at 8 n.3 and accompanying text (purporting to
identify “only some of [Plaintiff] ALIC’s more egregious misrepresentations” and not including
the statement at issue here)), but they now claim that “[t]hat determination is not supported by
the record facts and is, in fact, untrue” (Mot. Recons. at 8–9). Defendants also reiterate their
argument that the Database List and the identical Announcement List may have been generated
from memory and public sources. (Mot Recons. at 10)—an argument that the Court previously
considered and rejected (Op. at 17). Whatever can be made of all this, the Court did not commit
clear error in its determination, and reconsideration on this front is denied.
Defendants Stillwell and Francy entered into agreements with Plaintiff that they would

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In their Reply Brief, Defendants argue that the Supplement’s statement that “EFS must be
active at the end of the bonus period to receive credits for that period” means that an EFS who is
not active is unable to accumulate new credits but can still receive a bonus based on previous
years’ credits. (Reply at 2.) Though that reading is plausible, the provision could also mean that
an EFS is ineligible for a bonus based on any credits, new or previously accumulated. The
Court’s reading was not clear error.
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not solicit business within one mile of the location of their office with Plaintiff, and the Court
held that they breached those agreements by soliciting business at their previous office location.
(Op. at 16, 25.) Defendants argue that the Court should have analyzed whether the agreements,
as restrictive covenants, were enforceable under New Jersey law. (Mot. Recons. at 12–13.) A
restrictive covenant is enforceable if it is reasonable, and “[i]t will generally be found to be
reasonable where it simply protects the legitimate interests of the employer, imposes no undue
hardship on the employee, and is not injurious to the public.” Solari Industries v. Malady, 264
A.2d 53, 56 (N.J. 1970). An overbroad restrictive covenant may be enforced partially “to the
extent reasonable under the circumstances.” Id. at 61 (internal citations omitted). So even if the
Court were to find that the parties’ agreements were overbroad in preventing Defendants from
soliciting business within one mile of their previous office, the Court could certainly limit the
agreement so that Defendants would be disallowed from operating an insurance business in the
same location as their previous office. The Court will therefore not reverse its prior holding.
Finally, Defendants contest the Court’s finding that Defendants Stillwell and Francy
“solicit[ed]” business from their previous office location in violation of their contracts. (Mot.
Recons. at 13–14; see also Op. at 16, 25.) That conclusion was based on the following facts:
Defendant Stillwell contacted approximately fifty clients and informed them that
Defendant Stillwell was “a new member of the Ameriprise Financial team.” These
announcements listed Defendant Stillwell as Financial Advisor and President of
Defendant SFA and Defendant Francy as Operations Director, and they provided
Defendants Stillwell and Francy’s old Freehold, NJ office address.
(Op. at 6–7 (internal citations omitted).) Defendants argue that the Court failed to recognize a
genuine dispute of material fact as to whether these activities constituted solicitation under the
agreements. (Mot. Recons. at 14.) But the Court strains to imagine a reason why Defendants
would contact clients to provide the name of their new company and their business address, if
not to solicit business from those clients. It was not clear error to find that these actions
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constituted solicitation.
CONCLUSION
For the foregoing reasons, Defendants’ Motion for Reconsideration is denied. An
appropriate Order will follow.

Date:

7/24/19

/s/ Anne E. Thompson
ANNE E. THOMPSON, U.S.D.J.

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