United States District Court, S.D. Indiana, Indianapolis Division
ERIC S. TESLER, Plaintiff,
MILLER/HOWARD INVESTMENTS, INC., a Delaware Corporation, Defendant.
ENTRY ON DEFENDANT'S MOTION TO DISMISS
PLAINTIFF'S SECOND AMENDED COMPLAINT
WALTON PRATT, JUDGE United States District Court
matter is before the Court on Defendant Miller/Howard
Investment Inc.'s (“Miller/Howard”) Motion to
Dismiss Plaintiff Eric Tesler's (“Tesler”)
Second Amended Complaint. (Filing No. 42.) Tesler, a
former employee of Miller/Howard raises multiple claims
against Miller/Howard concerning unpaid compensation.
(Filing No. 35.) Specifically, Tesler is asserting
claims of violation of Indiana's Wage Claim Statute, Ind.
Code § 22-2-9 et seq. (Count I); violation of
Indiana's Wage Payment Act, Ind. Code § 22-2-5 et
seq. (Count II); unjust enrichment (Count III); conversion,
Ind. Code § 35-43-4-1 (Count IV); negligence (Count V);
breach of fiduciary duty (Count VI), fraud (Count VII) and
for breach of contract (Count VIII).
reasons that follow, the Court grants in part and denies in
part the Motion to Dismiss.
following facts are not necessarily objectively true. But as
required when reviewing a motion to dismiss, the Court
accepts as true all factual allegations in the Second Amended
Complaint and draws all reasonable inferences in favor of
Tesler as the nonmoving party. See Bielanski v. County of
Kane, 550 F.3d 632, 633 (7th Cir. 2008).
is a financial investment management corporation that sells
securities. On October 27, 2010, Tesler accepted
Miller/Howard's offer of employment as a Regional Sales
Director, which involved selling management investment
portfolios in his assigned geographic area, the “Middle
United States.” (Filing No. 35 at 3.)
Tesler's compensation package included, among other
terms: (1) a commission of “25%-10-%-5%-3%
ongoing” for each non-institutional account
(“SMA”) originally opened by Tesler; (2) a
commission of “15%-10%-5%” for each institutional
account (“UMA”) serviced by Tesler; and (3) a 3%
“ongoing” trail commission for current accounts
“to service existing business in territory.”
(Filing No. 1-1 at 3.) According to its written
Employee Policies, Miller/Howard would pay employees for all
earned, accrued, and unused vacation time upon separation of
employment. (Filing No. 35 at 4.)
opened numerous SMA accounts and managed numerous UMA
accounts during the course of his employment, which yielded
substantial and lucrative management fees for Miller/Howard.
(Filing No. 35 at 4.) However, by April 2012, he
became concerned that the commission amounts being paid to
him were not accurate or consistent with the Terms of
Compensation. (Filing No. 35 at 5.) Miller/Howard
never explained how Tesler's commission payments were
calculated, and Miller/Howard refused his repeated requests
for an accounting which would allow him to verify the
payments. (Filing No. 35 at 5.) Miller/Howard never
provided Tesler with any type of accounting of the fees
generated from these accounts, and thereby concealed their
true values. (Filing No. 35 at 4-5.)
March 7, 2014, Tesler's employment was terminated.
(Filing No. 35 at 3.) He alleges that Miller/Howard
failed to pay him for his unused vacation time, outstanding
reimbursable expenses, commissions that were due to him for
UMA and SMA accounts, and his ongoing 3% commission.
(Filing No. 35 at 6.)
about April 14, 2014, Miller/Howard's auditor notified
Tesler that due to an “accounting error, ” he was
underpaid for commissions in the third quarter of 2013 in the
amount of $2, 096.28. (Filing No. 35 at 6.) On or
about July 18, 2014, Miller/Howard notified him of another
“error” in his commission payments, resulting in
an underpayment of $12, 389.00 for 2013 and the first quarter
of 2014. (Filing No. 35 at 7.) And on July 29, 2014,
Miller/Howard provided an amended accounting. (Filing No.
35 at 7.) Tesler alleges that this accounting shows that
he was underpaid in the amount of $39, 365.25. (Filing
No. 35 at 7.) Miller/Howard has refused to pay any of
these amounts. (Filing No. 35 at 7-8.)
continues to refuse to provide Tesler with a complete and
accurate accounting of all the management fees earned from
SMA or UMA accounts for the fourth quarter of 2010, and for
2011 and 2012. (Filing No. 35 at 8.) Due to
Miller/Howard's conduct, Tesler has lost past, present,
and future income, vacation benefits, and reimbursement for
expenses incurred during his employment; he has suffered
damage to his career; and he has incurred additional
financial losses, including the costs associated with
claiming his unpaid wages. (Filing No. 35 at 8.)
filed an initial Complaint in this Court on March 21,
(Filing No. 1), and the operative Second Amended
Complaint on October 19, 2016, (Filing No. 35),
alleging eight causes of action: violation of Indiana Code
Section 22-2-9, the Indiana Wage Claims Act
(“IWCA”), violation of Indiana Code Section
22-2-5, the Indiana Wage Payment Act (“IWPA”),
unjust enrichment, conversion, negligence, breach of
fiduciary duty, fraud, and breach of contract. (Filing
No. 35 at 9-14.) Miller/Howard filed a Motion to
Dismiss, (Filing No. 41), raising challenges to each
of Tesler's eight causes of action. The Court will
address each argument in turn.
Rule of Civil Procedure 12(b)(6) allows a defendant to move
to dismiss a complaint that has failed to “state a
claim upon which relief can be granted.” Fed.R.Civ.P.
12(b)(6). When deciding a motion to dismiss under Rule
12(b)(6), the Court accepts as true all factual allegations
in the complaint and draws all reasonable inferences in favor
of the plaintiff. Bielanski v. County of Kane, 550
F.3d at 633 (7th Cir. 2008). However, courts “are not
obliged to accept as true legal conclusions or unsupported
conclusions of fact.” Hickey v. O'Bannon,
287 F.3d 656, 658 (7th Cir. 2002).
complaint must contain a “short and plain statement of
the claim showing that the pleader is entitled to
relief.” Fed.R.Civ.P. 8(a)(2). In Bell Atlantic
Corp. v. Twombly, the Supreme Court explained that the
complaint must allege facts that are “enough to raise a
right to relief above the speculative level.” 550 U.S.
544, 555 (2007). Although “detailed factual
allegations” are not required, mere “labels,
” “conclusions, ” or “formulaic
recitation[s] of the elements of a cause of action” are
insufficient. Id.; see also Bissessur v. Ind. Univ. Bd.
of Trs., 581 F.3d 599, 603 (7th Cir. 2009) (“it is
not enough to give a threadbare recitation of the elements of
a claim without factual support”). The allegations must
“give the defendant fair notice of what the . . . claim
is and the grounds upon which it rests.”
Twombly, 550 U.S. at 555. Stated differently, the
complaint must include “enough facts to state a claim
to relief that is plausible on its face.” Hecker v.
Deere & Co., 556 F.3d 575, 580 (7th Cir. ...