Trefethen v. Liberty Mutual

2013 DNH 148

Opinion

Trefethen v . Liberty Mutual 11-CV-225-SM 11/7/13 UNITED STATES DISTRICT COURT

DISTRICT OF NEW HAMPSHIRE

Margaret Trefethen, Plaintiff

v. Case N o . 11-cv-225-SM Opinion N o . 2013 DNH 148 Liberty Mutual Group, Inc., Defendant

O R D E R

As it did in the substantially similar case of Bryant v .

Liberty Mutual Group, Inc., 2013 DNH 142 (D.N.H. Oct. 2 4 , 2013),

Liberty Mutual has filed a motion for sanctions under Rule 11 of

the Federal Rules of Civil Procedure.1 That motion is denied.

The imposition of sanctions under Rule 11 is reserved for

cases in which a party or an attorney has made arguments for an

“improper purpose,” advanced “frivolous” claims, or asserted

factual allegations without “evidentiary support” or the “likely”

prospect of such support. See, e.g., Citibank Global Mkts., Inc.

1 Three former employees of Liberty Mutual brought independent, but substantially similar, suits against their former employer, asserting that they were the victims of wrongful termination and, in some cases, unlawful workplace discrimination. Each of those plaintiffs was represented by the same counsel and each raised similar legal arguments in an effort to invalidate the Severance Agreement and General Release they had signed upon their separation from Liberty Mutual. See Bryant v . Liberty Mut. Group, Inc., 11-cv-217-SM, Trefethen v . Liberty Mut. Group, Inc., 11-cv-225-SM, and Stevens v . Liberty Mut. Group, Inc., 11-cv-218-PB. v . Rodriguez Santana, 573 F.3d 1 7 , 32 (1st Cir. 2009). See also

CQ Int’l C o . v . Rochem Int’l, Inc., USA, 659 F.3d 5 3 , 60 (1st

Cir. 2011). This is not such a case.

Like the plaintiff in Bryant, Trefethen recognized that her

wrongful termination claims against Liberty Mutual would be

barred if the Severance Agreement and General Release she signed

was valid and enforceable against her. Indeed, Liberty Mutual

moved for summary judgment on that very ground, asserting that

Trefethen’s employment-related claims were precluded by the

Severance Agreement. Accordingly, Trefethen’s initial efforts

were focused on invalidating that agreement.

Trefethen’s efforts to overcome the contractual bar

ultimately proved unavailing. But, as was the case in Bryant,

Trefethen’s arguments were not so weak, or frivolous, or lacking

in factual or legal support as to warrant the imposition of

sanctions under Rule 1 1 . See generally Young v . City of

Providence, 404 F.3d 3 3 , 39-40 (1st Cir. 2005) (“[C]ourts ought

not invoke Rule 11 for slight cause; the wheels of justice would

grind to a halt if lawyers everywhere were sanctioned every time

they made unfounded objections, weak arguments, and dubious

factual claims.”). Nor is there evidence that those arguments

were advanced for an improper purpose or that counsel conducted a

2 culpably inadequate investigation prior to filing suit. And, of

course, Liberty Mutual is not entitled to an award of sanctions

under Rule 11 simply because some of Bryant’s claims proved

unsuccessful. See, e.g., Protective Life Ins. C o . v . Dignity

Viatical Settlement Partners. L.P., 171 F.3d 5 2 , 58 (1st Cir.

1999).

Conclusion

For the foregoing reasons, as well as those discussed in

greater depth in Bryant, the court concludes that Trefethen’s

legal arguments supportive of her view that the Severance

Agreement was unenforceable on grounds of fraudulent inducement

were consistent with existing law, there was adequate factual

support for at least some of the arguments she pressed, and there

was no evidence that those arguments were advanced for an

improper purpose.

Defendant’s Motion for Rule 11 Sanctions (document n o . 65)

is denied.

SO ORDERED.

Steven J. McAuliffl' / r ^ .; J- ^ J o -i- -, -i- ^ ^ r^ -; ,-, -i- e Jnited States District Judge

November 7, 2013

3 cc: John E . Lyons, Jr., Esq. Douglas J. Hoffman, Esq. Martha Van Oot, Esq. Debra W . Ford, Esq. K. Joshua Scott, Esq.