Sharpe v. Am. Acad. of Actuaries
Sharpe v. Am. Acad. of Actuaries
Opinion of the Court
Plaintiff Timothy W. Sharpe is an actuary and voluntary member of defendant American Academy of Actuaries (the "Academy"), a professional accreditation association. Am. Compl. ¶¶ 26-27, 36. Mr. Sharpe's six-count complaint seeks damages and injunctive relief from the Academy's alleged unlawful dissemination of information regarding Mr. Sharpe's disciplinary proceeding within the organization. Id. 29-39. Pending before the Court is the Defendant's Motion to Dismiss the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). Def.'s Mot. to Dismiss Am. Compl. Having confirmed that jurisdiction and venue is proper in this Court,
I. BACKGROUND
Mr. Sharpe is an actuary who has been practicing the profession for nearly 30 years. Am. Compl. ¶ 6. Among his clients are municipalities in the state of Illinois, for which he provides services related to pension matters. Id. Throughout his professional career, Mr. Sharpe has been a voluntary member of the Academy, a professional organization of actuaries with over 18,500 members. Id. at ¶¶ 26-27. In March 2014, Mr. Sharpe was the subject of a complaint filed with the Academy by Tia Sawhney, also an actuary, who raised concerns about Mr. Sharpe's alleged failure to comply with actuarial communication standards. Id. at ¶ 92.
The Academy's Bylaws establishes an operating unit within the Academy, the Actuarial Board for Counseling and Discipline ("ABCD"), to consider complaints made against member actuaries and recommend discipline to the Academy. Id. at ¶¶ 36-40. While the ABCD is part of the Academy, it also follows its ABCD Rules of Procedure ("ABCD Rules") setting forth its disciplinary process, which was promulgated pursuant to, and consistent with, the Academy's Bylaws' enabling provision. See Am. Compl. Ex. 2, Art. X, § 1 (establishing the ABCD and authorizing it to establish Rules of Procedure); id. Ex. 3 (the *287ABCD Rules).
Both the Academy's Bylaws and the ABCD Rules contain provisions governing the confidentiality of disciplinary proceedings. In the Bylaws, Article Ten provides that "[e]xcept as otherwise provided in these Bylaws, all proceedings under this Article shall be kept confidential by the ABCD, its staff, investigators, and advisers." Am. Compl. Ex. 2, Art. X, § 9. In the ABCD Rules, Section Ten similarly provides that "[t]he ABCD will make a reasonable effort to keep confidential the facts and circumstances involved in any matter considered by the ABCD for possible counseling or recommendations for discipline or the services of a mediator." Id. Ex. 3, § 10. However, both governing documents are explicit that the ABCD can provide the complainant with information on the disciplinary proceedings. Both documents state that the "requirement as to confidentiality shall not preclude the ABCD from [ ] [a]dvising complainants and subject actuaries about the progress and outcome of matters under consideration". Id. ; id. Ex. 2, Art. X, § 9. There is no confidentiality requirement imposed upon complainants (or, for that matter, the subject of a complaint).
In Mr. Sharpe's case, the Academy held a hearing on December 7, 2015 to consider the allegations, which Mr. Sharpe was unable to attend due to a serious illness involving his mother. Id. at ¶ 110. On January 29, 2016, the ABCD issued a written report recommending that the Academy expel Mr. Sharpe from membership. Id. at ¶ 112. On February 9, 2016, an article appeared on a website, WirePoints, under the headline: "Illinois Fire and Police Pension Actuary Facing Actuarial Discipline-WP Exclusive." Id. Ex. 1. The article, authored by Mark Glennon, founder of WirePoints, stated that the ABCD had "recently recommended that Timothy Sharpe, actuary to dozens of troubled Illinois fire and police pension funds, be expelled from membership in the [Academy]," and that the "recommendation is the result of separate complaints by two actuaries, one by actuary Tia Goss Sawhney." Id.
Mr. Sharpe contends that the Academy and/or ABCD must have improperly disseminated the ABCD's recommendation of expulsion, and that this allegedly improper conduct has resulted in the loss of clients. Id. at ¶¶ 131, 139. Accordingly, Mr. Sharpe sued the Academy for breach of contract, negligence, publication of private facts, denial of due process and fair procedure, tortious interference with contract, and tortious interference with prospective business advantage. Id. at 29-38. The Academy responds that Mr. Sharpe fails to state a claim upon which relief can be granted. Def.'s Mot. to Dismiss Am. Compl. For the reasons that follow, I find that each count in the Amended Complaint fails to state a claim upon which relief can be granted, and dismiss the complaint in its entirety.
II. LEGAL STANDARD
A party may move to dismiss a complaint on the ground that it "fail[s] to state *288a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). Federal Rule of Civil Procedure 8(a)(2) requires that a complaint contain "a short and plain statement of the claim showing that the pleader is entitled to relief." This requires the complaint to contain sufficient factual allegations that, if true, "state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly ,
In evaluating a motion to dismiss pursuant to Rule 12(b)(6), the Court must construe the complaint in the light most favorable to the plaintiff and accept as true all reasonable factual inferences drawn from well-pled factual allegations. See In re United Mine Workers of Am. Emp. Benefit Plans Litig. ,
III. ANALYSIS
As this matter is properly before the Court based on diversity of citizenship,
A. Breach of Contract
For the Plaintiff's breach of contract claim to survive a motion to dismiss *289based on Federal Rule of Civil Procedure 12(b)(6), he must sufficiently plead that there was: (1) a valid contract between the parties; (2) an obligation or duty arising out of the contract; (3) a breach of that duty; and (4) damages caused by the breach. Francis v. Rehman ,
1. Agreement on Joint Discipline and Article Nine of the Academy Bylaws
A plain reading of the Agreement on Joint Discipline and Article Nine, Section Six of the Academy Bylaws foreclose the possibility that these provisions give rise to a breach of contract claim. It is undisputed that Mr. Sharpe is a member only of the Academy and not of any other actuarial organization, and that the ABCD issued its recommendation on January 29, 2016. See Am. Compl. ¶¶ 43, 112. Therefore, the Agreement on Joint Discipline does not apply because the agreement effective at the time the ABCD rendered a decision in his case dictates,
If a Referring Body issues a recommendation to discipline a Subject Actuary who is a member of only one (1) of the Parties, such party shall proceed in accordance with its own individually established procedures for addressing such a recommendation, and this Agreement shall have no application to such proceeding.
2. Article Ten of the Academy Bylaws and Section Ten of the ABCD Rules
Turning to Article Ten, Section Nine of the Academy Bylaws and Section Ten of the ABCD Rules, neither of these provisions support a claim for breach of contract because both explicitly allow the ABCD to advise complainants "about the progress and outcome of matters under consideration." See id. Ex. 2, Art. X, § 9; id. Ex. 3, § 10. The Plaintiff makes several arguments about why this language is not fatal to his claim, but none meet Rule 12(b)(6)'s pleading standard.
The Plaintiff first argues that it is not clear who informed WirePoints about the ABCD's recommendation of expulsion. Id. at ¶¶ 140-142. But this is no whodunit. Based on the Amended Complaint and its attachments, the reasonable inference to draw is that the ABCD-per its policies-provided its recommendation to Ms. Sawhney, the complainant, who then disclosed the recommendation to further third parties.
The Plaintiff next argues that the ABCD flouted its responsibility to "make a reasonable effort to keep confidential the facts and circumstances involved in any matter considered by the ABCD for possible counseling or recommendations for discipline" because Ms. Sawhney made clear to the ABCD that she did not intend to keep its *291response to her complaint confidential. Pl.'s Mem. in Opp. to Def.'s Mot. to Dismiss Am. Compl. 36. This argument is unpersuasive because the ABCD's obligation with respect to making a reasonable effort to keeping information confidential is cabined by the very next sentence, which unequivocally states that the requirement "shall not preclude the ABCD from [ ] [a]dvising complainants and subject actuaries about the progress and outcome of matters under consideration." See
Last, the Plaintiff contends that the ABCD's recommendation was not an "outcome of [a] matter[ ] under consideration" and was therefore ineligible to be provided to the complainant under the Academy's Bylaws and the ABCD Rules. Pl.'s Mem. in Opp. to Def.'s Mot. to Dismiss Am. Compl. 30-31. Instead, the Plaintiff suggests that "matter" is a broad term that encompasses both the ABCD's investigative work and recommendation, as well as the Academy's determination on whether to implement the ABCD's recommendation.
The Plaintiff's interpretation fares no better within the ABCD Rules, for the very provision on which he relies for his breach of contract claim, Section 10, clearly indicates that a "matter" is a case that results in the ABCD's disciplinary recommendation. Indeed, the section starts: "The ABCD will make a reasonable effort to keep confidential the facts and circumstances involved in any matter considered by the ABCD for possible counseling or recommendations for discipline .... The requirement as to confidentiality shall not preclude the ABCD from[ ] [a]dvising complainants and subject actuaries about the progress and outcome of matters under *292consideration".
Defining an "outcome of [a] matter[ ] under consideration" as the ABCD's disciplinary recommendation is also consistent with the ABCD's and Academy's roles in the disciplinary process. As previously established, the ABCD does not impose discipline on an actuary itself, but makes a recommendation of discipline to the Academy. Thus, the ABCD's role ends when it issues its recommendation and report, and the "outcome of [a] matter[ ] under consideration" by the ABCD is necessarily its disciplinary recommendation.
B. Negligence; Publication of Private Facts; Tortious Interference
Given the reasonable inference drawn from the facts pled in the Amended Complaint-namely, that the ABCD provided Ms. Sawhney, the complainant, with its disciplinary recommendation as permitted by the Academy's Bylaws and the ABCD Rules-the majority of the Plaintiff's other claims also fail. The Plaintiff's Amended Complaint fails to state a claim for negligence because even assuming, arguendo , that the Defendant owed a duty to the Plaintiff, there could not have been a breach of the Defendant's duty under these circumstances. See Aguilar v. RP MRP Washington Harbour, LLC ,
The Plaintiff's claim for publication of private facts fails to adequately allege critical elements of the tort: publication absent any waiver. See Wolf v. Regardie ,
Additionally, the Plaintiff's tortious interference with contract and tortious interference with prospective business advantage claims fail because he has not sufficiently alleged that the Defendant intentionally interfered with any business relationship or expectancy. See Onyeoziri v. Spivok ,
*293C. Denial of Due Process
The Plaintiff's remaining claim for denial of due process also fails to meet Rule 12(b)(6). Courts ordinarily do not interfere with the internal disciplinary process of voluntary, private associations absent a failure of the association to follow its own rules, see, e.g. , Levant v. Whitley ,
IV. CONCLUSION
For the foregoing reasons, it is hereby ORDERED that the Defendant's Motion to Dismiss is GRANTED. A separate order will issue.
SO ORDERED.
See
Where an actuary is a member of multiple actuarial professional organizations, an Agreement on Joint Discipline controls, which outlines the complaint review and disciplinary process as among the multiple professional organizations. Am. Compl. ¶¶ 44-53. Mr. Sharpe is a member only of the Academy,
The Defendant is an Illinois corporation with its principal place of business in Washington, District of Columbia. Mem. of P. & A. in Support of Def.'s Mot. to Dismiss Pl.'s Am. Compl. 21. Mr. Sharpe, although a citizen of Michigan, Am. Compl. ¶ 26, has provided services to Illinois pension funds since 1992 and has maintained a place of business in Illinois.
The Plaintiff argues that an earlier version of the agreement governs instead, Am. Compl. ¶¶ 160-166, but this, too, is countered by the explicit language of the document. The agreement dated December 10, 2015 specifies that it shall be effective for "cases in which a Referring Body recommends disciplinary action on or after December 10, 2015," and that "the terms and conditions of the Original Agreement shall have no further force and effect for any case in which a recommendation of disciplinary action is issued by a Referring Body on or after December 10, 2015."
The Defendant argues that I should only give effect to the Plaintiff's Original Complaint, wherein he alleged that the Academy "informed Ms. Sawhney of the ABCD's confidential recommendation" and that she, in turn, informed WirePoints of ABCD's recommendation. Compl. ¶¶ 98-99. In the Defendant's view, the apparent about-face in the Plaintiff's position means that I should only accept as true the factual inference that the Defendant disclosed the ABCD's recommendation to Ms. Sawhney. Def.'s Mot. to Dismiss Am. Compl. 25-26 (citing Hourani v. Mirtchev ,
Reference
- Full Case Name
- Timothy W. SHARPE v. AMERICAN ACADEMY OF ACTUARIES
- Cited By
- 7 cases
- Status
- Published