Falk v. UHH Home Services Corp., No. 92 C 1079.

• Decision Date: 18 October 1993
• Docket Number: No. 92 C 1079.
• Parties: Cynthia G. FALK, Plaintiff, v. U.H.H. HOME SERVICES CORP. d/b/a Kimberly Quality Care, Inc., Defendant.
• Court: U.S. District Court — Northern District of Illinois

835 F. Supp. 1078

Cynthia G. FALK, Plaintiff, v. U.H.H. HOME SERVICES CORP. d/b/a Kimberly Quality Care, Inc., Defendant.

No. 92 C 1079.

United States District Court, N.D. Illinois, E.D.

October 18, 1993.

Herbert H. Victor, Chicago, IL, for plaintiff.

Guy P. Tully, Joan Ackerstein, Jackson, Lewis, Schnitzler & Krupman, Boston, MA, for defendant.

MEMORANDUM OPINION AND ORDER

NORDBERG, District Judge.

Plaintiff, Cynthia G. Falk, sued her former employer, Kimberly Services, Inc. ("Kimberly") in Cook County Circuit Court. Kimberly removed the claim to this Court on diversity grounds. Kimberly now files a Motion to Dismiss, pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). For the reasons stated below, the Motion is GRANTED in part and DENIED in part.

BACKGROUND

In ruling on the Defendant's Motion to Dismiss, the Court is required to accept as true all facts alleged in the Plaintiff's complaint and to draw all reasonable inferences from the pleadings in favor of the Plaintiff. Gillman v. Burlington N.R., 878 F.2d 1020, 1022 (7th Cir.1989). Therefore, the Court sets out the facts of this case as they are alleged in the Plaintiff's complaint.

Cynthia Falk enjoyed a successful career at Kimberly Services, a company that provides employment placement services for hospitals. She began working for Kimberly in 1980 as Branch Manager of its Cincinnati, Ohio office. In August of 1981 she was promoted to Regional Director for the Boston, Massachusetts area. From 1981 to 1987 she significantly expanded the sales territory served by the Boston office. By 1988 Falk was earning in excess of $100,000 per year, had eliminated her travel responsibilities, and had purchased a condominium in Boston which she shared with her boyfriend.

In 1990 Falk was contacted by the C.E.O. of Kimberly, Lawrence Stuesser. Stuesser stated that, based on Falk's success in Boston, she would be the perfect person to expand Kimberly's Staffing Division in the Chicago metropolitan area. Stuesser told Falk that, although the job would entail more travel and administrative duties than her Boston position, it would also offer her greater financial opportunity. Falk decided to accept the new position. She then met with Kimberly's Senior Vice-President, Paul Touchton, to negotiate the responsibilities, salary, bonus, and authority of the Chicago position. The two agreed that Falk would market Kimberly's services in the greater Chicago area and that Kimberly would supply her with an office and transportation budget. On January 18, 1991, Falk left her position in Boston and moved to Chicago.

Falk soon encountered difficulties with other Kimberly employees in Chicago. Falk found that Kimberly's Chicago staff viewed her as potential competition which would cause them loss of income. On February 15, 1991 Don Camp, Kimberly's Senior Vice President of its Central Division, contacted Falk. He informed Falk that she was on his "turf" and that she reported to him.

On April 8, 1991 the Branch Manager of Kimberly's Skokie, Illinois office complained that Falk was taking away potential business from the Skokie office and that she should be stopped. That same day, Camp notified Falk that her sales activities were to be strictly confined to the city limits of Chicago. When Camp was informed that this restriction was in violation of Falk's agreement with Kimberly, he threatened to close her office if she violated his directive. Falk then complained to Touchton about Camp's limitations. Touchton responded that, because of a restructuring at Kimberly, Falk came under Camp's direction and Touchton was powerless to intervene. In 1992, Falk's office was closed for lack of business and her employment at Kimberly was terminated.

Falk now sues Kimberly under Illinois's law of promissory estoppel. She argues that Kimberly promised her a certain type of employment in the Chicago area. In reliance on that promise she gave up an established and highly profitable position, left friends and family, and vacated an expensive condominium. Kimberly then broke its promise by giving her an inferior position within Chicago's city limits. Under Illinois law, she argues, Kimberly should now be made liable for her lost wages, fringe benefits, attorney's fees, other costs, and punitive damages.

In response to Falk's complaint, Kimberly files this motion to dismiss. Kimberly argues that, even if all of the facts as alleged are true, the company is not liable for any of the claimed relief. Kimberly contends that in Illinois an employee invoking promissory estoppel against an employer must allege that the employer promised to employ him or her for a certain duration of time. Kimberly argues that it never made any promises to Falk concerning the duration of her employment with the company. As a result, she was an employee at will who could be terminated at any time without cause.

ANALYSIS

Promissory estoppel is an equitable doctrine that may be invoked in both contractual and noncontractual settings. Geva v. Leo Burnett Co., 931 F.2d 1220, 1223 (7th Cir.1991). Illinois's law of promissory estoppel has four elements. To establish a claim a plaintiff must allege that (1) defendant made an unambiguous promise to plaintiff; (2) plaintiff relied on such promise; (3) plaintiff's reliance was expected and foreseeable by defendant; and (4) plaintiff relied on the promise to its detriment. Quake Const., Inc. v. American Airlines, Inc., 141 Ill.2d 281, 152 Ill.Dec. 308, 322, 565 N.E.2d 990, 1004 (Ill.1990). In the present case only the first element is in dispute. Kimberly does not contest that Falk's actions created a detrimental reliance interest if taken pursuant to a promise, or that those actions were foreseeable to Kimberly. Kimberly only argues that Falk did not, and cannot, allege the existence of an unambiguous promise.

In order to allege an unambiguous promise for the purposes of a promissory estoppel claim, an express promise is not required. First Nat'l Bank v. Sylvester, 196 Ill.App.3d 902, 144 Ill.Dec. 24, 31, 554 N.E.2d 1063, 1070 (Ill.App.Ct.), appeal denied, 133 Ill.2d 555, 149 Ill.Dec. 320, 561 N.E.2d 690 (Ill.1990). A promise may be inferred from conduct and words. Id. In First Nat'l Bank the Illinois Appellate Court considered a promissory estoppel claim made by a construction company against a bank. The bank had repeatedly extended the company credit over a long period of time. The construction company entered a subcontract in reliance on obtaining further financing from the bank. The bank refused to extend credit causing the company to default on it's contract. The Court held that the bank's past practice could estop it from refusing to extend credit and, as a matter of law, it could be held liable for the company's reliance expenses. Id.

In employment relationships, however, promises concerning the duration of employment must be alleged with more specificity. Illinois courts have traditionally adhered to the presumption of employment at will. An overly permissive operation of the promissory estoppel doctrine in an employment setting could undermine that presumption. Goldstick v. ICM Realty, 788 F.2d 456, 465 (7th Cir.1986); Lamaster v. Chicago & N.E. Ill.Dist. Council, 766 F.Supp. 1497, 1505 (N.D.Ill.1991). In Simmons v. John F. Kennedy Medical Center, 727 F.Supp. 440 (N.D.Ill.1989), a federal district court considered an employee's claim that her employer had promised to employ her for a certain duration. The Court found that under Illinois law the company's...