Henderson v. Skyview Satellite Networks, Inc.

• Decision Date: 24 July 2020
• Docket Number: CIVIL ACTION NO. 3:18-CV-00528-JRW-RSE
• Citation: 474 F.Supp.3d 893
• Parties: Karen HENDERSON, Plaintiff v. SKYVIEW SATELLITE NETWORKS, INC., Defendant
• Court: U.S. District Court — Western District of Kentucky

474 F.Supp.3d 893

Karen HENDERSON, Plaintiff

v.SKYVIEW SATELLITE NETWORKS, INC., Defendant

CIVIL ACTION NO. 3:18-CV-00528-JRW-RSE

United States District Court, W.D. Kentucky.

Signed July 24, 2020

Filed July 27, 2020

Carmen D. Caruso, William B. Whitner, Carmen D. Caruso Law Firm, Gary D. Abrams, Gary D. Abrams & Associates, Chicago, IL, Lindsay A. Cordes, Thomas Law Offices, PLLC, Louisville, KY, for Plaintiff.

Amy Abdo, Jennifer L. Clyde, Jessica L. Post, Fennemore Craig, P.C., Phoenix, AZ, D. Duane Cook, John M. Sosbe, Jason M. Obermeyer, Cook & Watkins, PLC, Georgetown, KY, for Defendant.

ORDER

Justin R Walker, District Judge

1. The Court DENIES Skyview's Motion to Dismiss (DN 40).

2. The Court GRANTS Skyview's Motion for Summary Judgment (DN 59) and DISMISSES Henderson's claims for defamation per se , defamation per quod , breach of contract, and tortious interference.

3. The Court GRANTS IN PART and DENIES IN PART Henderson's Motion for Summary Judgment and Rule 37 Relief (DN 79). Skyview cannot pursue the equitable remedy of disgorgement but can seek damages for lost profits.

4. The Court DENIES AS MOOT Skyview's Motion to Strike Plaintiff's Post-Deposition Affidavit (DN 88).

MEMORANDUM OPINION

This matter is before the Court on Defendant's Motion to Dismiss (DN 40), Defendant's Motion for Summary Judgment (DN 59), Plaintiff's Motion for Summary Judgment and Rule 37 Relief (DN 79), and Defendant's Motion to Strike Plaintiff's Post-Deposition Affidavit (DN 88). These issues are now ripe for adjudication.

I. BACKGROUND

A. Statement of Facts

In September 2014, Karen Henderson began working as a National Audio Sales Manager for Skyview Satellite Networks, Inc. (DN 35, ¶ 13). Henderson sold advertisements for Skyview and reported to Jeanne-Marie Condo, Skyview's Executive Vice President & General Manager. In October 2016, Henderson notified Skyview of her intention to go to work for a competitor. The parties negotiated new employment terms in order to entice Henderson to remain with Skyview. (Id. at ¶¶ 18-20). The resulting Employment Agreement outlined Henderson's salary base, commission structure, and guaranteed annual income from 2017-2019. It provided that Henderson would not "entertain or engage in any employment offers during the three year agreement." (Id. at ¶¶ 20-21; DN 40-1).

In early 2017, Henderson became concerned that Skyview was overbilling a client. (DN 35, ¶ 24). Upon review, Skyview discovered a system error, which prompted Skyview President Ken Thiele to issue an apology and rebate credit to the client. (Id. ). Henderson claims that shortly after the overbilling incident, she was denied access to information concerning advertisements she sold and was stripped of many of her duties as vice-president. (Id. at ¶¶ 27-28). She says that Skyview then began to systematically cause financial harm to her by forcing her to share commissions and by pulling her from several lucrative accounts, including the Starcom account, without compensating her for the lost income. (Id. at ¶¶ 29, 31-32).

Beginning in February 2018, Henderson began communicating with Fred Bennett, an executive at Entercom—a direct competitor of Skyview. (DN 59, 5). During the next few months, Henderson met with Bennett, spoke with him regularly, and then proceeded to meet with several high-level executives of Entercom. (Id. at 6-8).

In July 2018, Henderson was summoned to Arizona for a meeting with Thiele and other Skyview executives to discuss Henderson's meetings with Entercom executives. At this meeting, Henderson was placed on "administrative leave" and was required to relinquish her laptop computer to Skyview. (DN 35, ¶¶ 34-35).

On July 16, 2018, Condo sent the following email to Henderson's entire email contacts list:

Good morning,

Karen Henderson will be on administrative leave and unavailable the next three weeks. We will have an update for you on Tuesday August 7th. Her fellow sales team is by your side and ready to do a great job. A Skyview executive will reach out by the end of tomorrow so you have a direct contact for care.

You of course, have my contact information below and all of us are by your side.

We ask that you do not contact Karen during this time.

Thank you,

Jeanne-Marie

(Id. at ¶ 36). This email went out to over 100 people, many of whom were Henderson's friends, family members, neighbors, and other non-work-related professional contacts. (Id. at ¶¶ 37-38). Henderson alleges that she made repeated requests for Skyview to retract the email or provide her with a complete distribution list so she could attempt to mitigate the damage, all of which were ignored. (Id. at ¶ 39). Skyview then excluded Henderson from Skyview's 2018 national sales conference, even though she was still an employee with high sales volume. (Id. at ¶ 40).

In August 2018, Henderson received a letter terminating her employment with Skyview. The letter stated that Henderson was fired because:

(i) [she] had been pursuing job opportunities with other companies in breach of [her] employment agreement; (ii) [she] had encouraged Skyview personnel to work for a competitor in violation of the Non-Solicitation and Confidentiality Agreement that [she] signed; (iii) [she] had disclosed multiple confidential documents to a third-party[,] also in violation of [her] Non-Solicitation and Confidentiality Agreement; and (iv) [she] had made disparaging statements about [her] supervisor to third-parties and co-workers.

(DN 40-2, 1). The termination letter further stated: "As a reminder, you promised for a period of twelve months following date of termination not to solicit Skyview customers or Skyview employees." (Id. ; DN 35, ¶ 43).

Condo then sent out another email to Henderson's email contacts, this time stating, in relevant part, that:

Karen Henderson is no longer employed with Skyview Networks. We appreciate her efforts in sharing with you one of the most dynamic portfolios in network radio. We wish her the best of luck in her future endeavors.

(DN 35, ¶ 44). Skyview admits that Condo sent the identified emails but also contends that it believed that all the email recipients were "clients or prospective clients[.]" (DN 39, ¶¶ 32-34, 41-44).

B. Procedural History

Henderson initiated the present action against Skyview. (DN 1). Through a Second Amended Complaint, Henderson pleaded claims for: defamation per se , defamation per quod , breach of contract, declaratory relief, tortious interference, and wrongful discharge. (DN 35). Skyview responded with an Answer and Amended Counterclaim asserting claims for breach of contract and breach of the duty of loyalty. (DN 39). Skyview also moved to dismiss Henderson's wrongful discharge claim. (DN 40). Later, Skyview moved for summary judgment on Henderson's claims for breach of contract, defamation, and tortious interference. (DN 59). Henderson also moved for summary judgment and Rule 37 Relief on two of Skyview's grounds for damages. (DN 79). Finally, Skyview moved to strike a declaration attached by Henderson to her response to Skyview's motion for summary judgment. (DN 88).

II. DISCUSSION

A. Skyview's Motion to Dismiss: Wrongful Discharge

A motion to dismiss under Fed. R. Civ. P. 12(b)(6) considers the sufficiency of the complaint. "[A] complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ " Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly , 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). "[A] district court must (1) view the complaint in the light most favorable to the plaintiff and (2) take all well-pleaded factual allegations as true." Tackett v. M & G Polymers, USA, LLC , 561 F.3d 478, 488 (6th Cir. 2009) (citation omitted). Even so, the Court need not accept a party's "bare assertion of legal conclusions." Columbia Nat. Res., Inc. v. Tatum , 58 F.3d 1101, 1109 (6th Cir. 1995) (citation omitted). This inquiry is a "context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Iqbal , 556 U.S. at 679, 129 S.Ct. 1937.

Henderson alleges that Skyview wrongfully terminated her in violation of public policy because she opposed fraudulent billing practices. Skyview contends that Henderson fails to state a claim for wrongful discharge.

Kentucky¹ generally follows the employment-at-will doctrine, under which "an employer may discharge an at-will employee for good cause, for no cause, or for a cause that some might view as morally indefensible."²

Wymer v. JH Props., Inc. , 50 S.W.3d 195, 198 (Ky. 2001) (citation omitted). The tort of wrongful discharge creates a "narrow public policy exception" to this rule when the employee is fired for a reason that undermines a "most important public policy." Hill v. Ky. Lottery Corp. , 327 S.W.3d 412, 420 (Ky. 2010), as modified on denial of reh'g (Dec. 16, 2010) (quoting Firestone Textile Co. Div. v. Meadows , 666 S.W.2d 730, 734 (Ky. 1983) ). The Kentucky Supreme Court has clarified that in the absence of "explicit legislative statements prohibiting the discharge," a claim may still be actionable in two situations: "First, where the alleged reason for the discharge of the employee was the failure or refusal to violate a law in the course of employment. Second, when the reason for a discharge was the employee's exercise of a right conferred by well-established legislative enactment." Grzyb v. Evans , 700 S.W.2d 399, 402 (Ky. 1985) (citation and internal quotation marks omitted).

Henderson claims she was discharged in retaliation for refusing to violate the law. This exception generally requires an employer to make an affirmative request that the employee violate the law. See, e.g., Charles v. Print Fulfillment Servs., LLC , No. 3:11-CV-00553, 2015 WL 5786817, at *7 (W.D. Ky. Sept. 30, 2015) ("To sustain a cause of action under the refusal exception, [the employee] must show that [the employer] made an...