Swick v. Liautaud

• Decision Date: 18 January 1996
• Docket Number: No. 78313,78313
• Parties: , 215 Ill.Dec. 98, 11 IER Cases 646 Andrew C. SWICK et al., Appellees, v. James LIAUTAUD et al., Appellants.
• Court: Illinois Supreme Court

Page 1238

662 N.E.2d 1238

169 Ill.2d 504, 215 Ill.Dec. 98, 11

IER Cases 646

Andrew C. SWICK et al., Appellees, v. James LIAUTAUD et al., Appellants.

No. 78313.

Supreme Court of Illinois.

Jan. 18, 1996.

Rehearing Denied April 1, 1996.

Kimball R. Anderson, Christopher S. Canning and David E. Koropp, Winston & Strawn, Chicago, for James Liautaud.

Amy L. Silvestri, Rockford, for Trial Lawyers Association.

James L. Donnelly, Marc A. Primack, Rooks, Pitts & Poust, Chicago, for Illinois Manufacturers.

Brady, McQueen, Martin, Collins & Jensen (Alfred Y. Kirkland, Jr., of counsel), Willard B. Widerberg, Law Offices of Willard B. Widerberg, Elgin, for Andrew C. Swick.

Justice HEIPLE delivered the opinion of the court:

Plaintiffs, Andrew Swick and Dianne Swick, brought an action in the circuit court of Kane County against Gabriel, Inc., Capsonic Group, James Liautaud and Prabhudas Patel alleging malicious prosecution, interference with prospective advantage, interference with lawful competition through malicious intimidation, false light, libel, and intentional infliction of emotional distress. The trial court granted defendants directed verdicts on the interference with prospective advantage, interference with lawful competition and false light counts. The jury returned a verdict in favor of Swick on the malicious prosecution count and awarded Swick punitive damages. The jury found in favor of defendants on the libel and intentional infliction of emotional distress counts. The appellate court affirmed the jury verdict and the directed verdicts. (No. 1-93-1099 (unpublished order under Supreme Court Rule 23).) We granted defendants' petition for leave to appeal (145 Ill.2d R. 315).

BACKGROUND

The following facts are not in dispute. Swick became an employee of Capsonic in 1985. Gabriel is the parent company of Capsonic. Liautaud is the sole owner and chairman of Gabriel and Patel is president of Capsonic. When Swick began his employment with Capsonic, he signed a document which acknowledged that Capsonic owned proprietary information and which confirmed that this information would be kept confidential. The document further stated that if at any time Swick left Capsonic, Swick would deliver to Capsonic any Capsonic documents and drawings in his possession and that Swick could not enter into direct competition with Capsonic for a period of two years.

In October 1988, Swick accepted a position with Altair/Augat, a competitor of Capsonic. On November 5, 1988, prior to leaving Capsonic and prior to telling Liautaud or Patel of his new position, Swick photographed machinery at the firm. At this time, Swick also had Capsonic parts, designs and documents in his personal possession outside of Capsonic offices. When approached about the photographs, parts, designs and documents, Swick agreed to return them to Capsonic.

On November 9, Swick returned the photographs to Capsonic, but he kept a second set for himself. Swick did not return the parts, designs and documents at this time. During several meetings between Swick, Patel and Liautaud, Swick denied having accepted another position.

On November 10, Patel contacted the Elgin police department regarding the materials in Swick's possession. That day a trial court issued a search warrant for Swick's home and the warrant was executed in the evening. The police found blueprints, drawings, and parts pertaining to Capsonic machinery and materials in Swick's home. The police were unable to recover all of the documents, which Swick later destroyed.

Several days later, the State's Attorney charged Swick with theft of property over $300. On January 3, 1989, Swick began work at Altair. On January 23, 1989, the criminal charges against Swick were nol-prossed. In March of 1991, Swick filed a multicount complaint against Gabriel, Capsonic, Liautaud and Patel. ¹

At trial, the parties offered different versions of the facts. Swick claimed that after the police searched his home, he met with Liautaud and Patel. Swick told them that he had accepted another job. Swick alleged that Liautaud then threatened him and Liautaud said that Swick would never work in the industry again, that Swick would not be able to get a job, and that Swick's name would be in the press. Swick claimed that Liautaud was angry at him for taking another job. Swick stated that in retaliation for his accepting the job with Altair, Liautaud and Patel ordered that the police search his home and demanded that the State's Attorney pursue the theft charge. Swick also stated that Liautaud forced him to sign a confession of sorts, wherein he stated that he took the photographs without authorization, while knowing that the equipment he was photographing represented trade secrets and intellectual property.

Swick also claimed that he had told several of his co-workers of his job with Altair and that they did not see any problems with his continuing to work at Capsonic while waiting for the new job at Altair. Swick further testified that there was not a company policy or rule which prevented him from taking the pictures and, in any event, the pictures were worthless. Swick stated that employees routinely took home drawings and other documents. There was no company procedure to keep track of who had which documents.

The defendants argued that the materials recovered from Swick's home had a significant monetary value and related directly to Capsonic's proprietary designs and manufacturing processes. Liautaud claimed that if a competitor gained access to the materials, Capsonic could lose over a million dollars. The defendants argued that they feared that Swick would reveal Capsonic secrets to Altair if they did not obtain the photos, documents and parts.

Lieutenant Carl Olsen of the Elgin police department, who investigated the allegations made by Patel and Liautaud, also testified at trial. Olsen testified that the State's Attorney contacted him to determine if he objected to the entry of the nolle prosequi. Olsen also stated that a nolle prosequi is a voluntary dismissal which allows the State's Attorney to reopen the case at a later time, but it is not a finding that the defendant is either guilty or not guilty. Olsen did not state the reasons for the nolle prosequi. The court order nol-prossing the criminal charges was entered into evidence, but neither party provided any additional evidence as to why the order was entered.

At the close of evidence, the trial court granted a directed verdict in favor of defendants on all counts of Swick's complaint except those alleging libel and intentional infliction of emotional distress. The court determined that Swick failed to prove an essential element of the malicious prosecution count, namely, that the underlying criminal charge was terminated in a manner favorable to Swick, and that a directed verdict in favor of defendants was proper. The court noted that it had heard no evidence on why the nolle prosequi was entered. However, prior to the start of jury deliberations and upon Swick's motion for reconsideration, the trial court changed its decision regarding the malicious prosecution count and found that the jury could consider this claim. The jury instructions read that "A nolle prosequi dismissal of a criminal proceeding is a termination in favor of the plaintiff."

The jury returned a verdict in favor of Swick on the malicious prosecution count and awarded Swick $5,000 in compensatory damages. The jury further assessed punitive damages against Liautaud in the amount of $400,000 and against Gabriel, including Capsonic, in the amount of $250,000. The defendants requested both a judgment notwithstanding the verdict and a new trial on the malicious prosecution claim. The trial court denied both requests.

The jury found against Swick and in favor of the defendants on the libel and intentional infliction of emotional distress counts. Further, the jury found in favor of the defendants on all counts involving Dianne Swick.

The appellate court affirmed. The court stated that by presenting the nolle prosequi order, Swick "offered sufficient evidence from which a jury could conclude that the theft case was terminated in his favor." The court also approved the jury instruction on the effect of a nolle prosequi. Finally, the court rejected Swick's cross-appeal, which claimed error in the grant of the directed verdicts and in the exclusion of certain evidence.

On appeal to this court, defendants argue that: (1) Swick failed to satisfy his burden of proof on the malicious prosecution count, in that bare evidence of the nolle prosequi did not establish that the underlying criminal proceeding was terminated in Swick's favor; (2) the trial court erred in giving the limited instruction on the effect of a nolle prosequi; (3) the punitive damages award was excessive, duplicative and in violation of their rights; and (4) Swick failed to prove compensable damages. Swick has filed a cross-appeal in which he claims that the trial court erred in granting directed verdicts on the invasion of privacy, interference with prospective advantage and interference with lawful competition counts and in excluding evidence in support of the libel and intentional infliction of emotional distress counts.

MALICIOUS PROSECUTION ACTION

Defendants contend that the bare offering of the nolle prosequi order, without any additional testimony as to why the order was entered, did not establish that the criminal proceedings were terminated in Swick's favor. Defendants note that Swick alleged in his complaint that the criminal charges were nol-prossed because of the "absence of any showing of evidence indicating Swick's guilt." Defendants argue that since Swick did not offer evidence of the State's Attorney's reasons for the nolle prosequi, Swick failed to establish an essential element of his malicious prosecution claim.

In order to establish a malicious prosecution action, the plaintiff must allege facts...