Scott v. HOME CHOICE, INC.

316 F. Supp. 2d 1041, 2004 U.S. Dist. LEXIS 7908, 2004 WL 957657
CourtDistrict Court, D. Kansas
DecidedFebruary 18, 2004
DocketCIV.A.02-2112-CM
StatusPublished

This text of 316 F. Supp. 2d 1041 (Scott v. HOME CHOICE, INC.) is published on Counsel Stack Legal Research, covering District Court, D. Kansas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Scott v. HOME CHOICE, INC., 316 F. Supp. 2d 1041, 2004 U.S. Dist. LEXIS 7908, 2004 WL 957657 (D. Kan. 2004).

Opinion

MEMORANDUM AND ORDER

MURGUIA, District Judge.

Plaintiff James Scott filed this action bringing fraud, breach of contract and malicious use of process, abuse of process claims against defendant Home Choice, Inc. d/b/a RentWay (Rentway). This matter comes before the court on RentWay’s Motion for Summary Judgment (Doc. 54), Scott’s Motion for Partial Summary Judgment as to Liability but Not Damages (Doc. 58) and Scott’s Motion for Summary Judgment by Plaintiff or if Not Granted, for Partial Summary Judgment (Doc. 59).

I. Facts/Procedural History 1

RentWay is a corporation conducting business in the State of Kansas. Scott is a resident of the State of Missouri and a former employee of RentWay. After leaving his employment with RentWay in 1998, Scott filed a Charge of Discrimination with the Equal Employment Opportunity Commission (EEOC) asserting race discrimination and harassment claims against Rent-Way.

On May 14, 1999, Scott executed a confidential settlement agreement and general *1044 release (the settlement agreement) to resolve his EEOC Charge and any other claims that he had or may have had against RentWay and any of its affiliated companies. The settlement agreement contains a general release and waiver of Scott’s claims and a covenant not to sue RentWay. Pursuant to the settlement agreement, Scott agreed to fully and finally release and discharge RentWay from any and all actions, causes of action, suits and other similar actions, whether known or unknown, arising out of his employment with RentWay. Scott specifically agreed to never sue RentWay for any claims of discrimination, harassment, or retaliation under Title VII of the Civil Rights Act of 1964 (Title VII), or any other anti-discrimination and/or employment laws.

The settlement agreement also contains a confidentiality and non-disparagement provision, which states that Scott will “not make any statements or take any actions to disparage [RentWay], to place [Rent-Way] in a negative light or which are inconsistent with the interests of [Rent-Way].” Scott also agreed not to “instigate, cause, advise or encourage any other persons, groups of persons, corporations, partnerships or any other entity to file litigation or other claims or charges against [RentWay].” Scott was, at all times prior to executing the settlement agreement, represented by an attorney. RentWay paid Scott approximately $43,000 (in addition to attorneys’ fees) as consideration for executing the settlement agreement.

On July 12, 1999, Scott filed a lawsuit in this court entitled James Scott v. Home Choice, Inc. d/b/a Rentway, Case No. 99-2311-JWL (the first federal lawsuit). In the first federal lawsuit, Scott alleged that RentWay violated his rights under Title VII and 42 U.S.C. § 1981. Before even filing an answer, RentWay moved to dismiss Scott’s complaint, claiming that the allegations forming the basis of the first federal lawsuit were the subject of the settlement agreement and that by filing the first federal lawsuit, Scott breached the settlement agreement. On November 19, 1999, this court held that the settlement agreement executed between the parties is an enforceable contract and dismissed the first federal lawsuit.

On February 28, 2000, RentWay filed a lawsuit against Scott in the Circuit Court of Jackson County, Missouri, entitled Home Choice, Inc. d/b/a Rent Way v. James Scott, Case No. 00-CV-205272 (the Missouri action), alleging that Scott breached the settlement agreement when he filed the first federal lawsuit and that Scott had recruited potential plaintiffs against RentWay. The Missouri action also sought to enjoin Scott from breaching the non-disparagement clauses of the settlement agreement.

RentWay filed a motion for summary judgment in the Missouri action, seeking to enforce the terms of the settlement agreement, which the court granted on October 17, 2001. The Missouri court’s October 17, 2001, Order prohibited Scott from: 1) suing or bringing any other action against RentWay, whether federal, state, local or administrative, with respect to any claim arising from his employment with RentWay; 2) making any statements or taking any actions to disparage Rent-Way or to place RentWay in a negative light; or 3) instigating, causing, advising or encouraging any other person, groups of persons, corporations, partnerships or any other entity to file litigation or other claims or charges against RentWay. As part of ruling on RentWay’s motion for summary judgment, the Missouri court held that the settlement agreement executed between the parties constitutes a valid and enforceable contract.

*1045 On March 13, 2002, Scott filed the present lawsuit against RentWay alleging fraud, malicious use of process, abuse of process, and breach of contract claims. Subsequently, on April 1, 2002, RentWay filed a motion in the Missouri action to hold Scott in civil contempt of court for violating the Missouri court’s October 17, 2001, Order and the settlement agreement. In the contempt motion, RentWay alleged that Scott had disparaged RentWay, instigated other individuals to file litigation against RentWay, and filed another suit against RentWay in federal court. On August 20, 2002, the Missouri court held a hearing on the contempt motion, which included presentation of evidence by both Scott and RentWay. The Missouri court subsequently held Scott in contempt of court for violating its October 17, 2001, Order. On November 26, 2002, the Missouri court entered an order fining Scott $1000. Scott has requested that the Missouri court reduce the amount of the contempt fine, but did not appeal either the Missouri court’s summary judgment in favor of RentWay or the Missouri court’s November 26, 2002, contempt order.

In the meantime, on April 15, 2002, RentWay filed a motion to dismiss Scott’s complaint in the current lawsuit pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction and on grounds of “judicial economy.” Rent-Way argued that plaintiffs claims arose from the same set of facts forming the basis of litigation that was pending in Missouri state court in Jackson County at that time. RentWay also claimed the current lawsuit was an alleged violation of the settlement agreement.

In a February 20, 2003, Order, this court denied RentWay’s motion to dismiss on both grounds, holding that subject matter jurisdiction was appropriate pursuant to 28 U.S.C. § 1332, and that it could find no grounds for abstaining from hearing the case. In its February 20, 2003, Order denying RentWay’s motion to dismiss, this court noted:

The court is uncertain whether, in asking the court to dismiss plaintiffs complaint because it “arise[s] from the same set of facts” as the state court litigation, defendant Rent Way requests the court to abstain in light of the ongoing state proceeding, or to dismiss the case on grounds of res judicata or collateral es-toppel.

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Bluebook (online)
316 F. Supp. 2d 1041, 2004 U.S. Dist. LEXIS 7908, 2004 WL 957657, Counsel Stack Legal Research, https://law.counselstack.com/opinion/scott-v-home-choice-inc-ksd-2004.