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Amoroso v. Schuh

United States District Court, W.D. Wisconsin

September 30, 2017




         In this lawsuit, plaintiff Vince Amoroso asserts defamation claims against four former colleagues at Sentry Insurance, a Mutual Insurance Company, arising out of a memorandum circulated among Sentry's Board of Directors ("the Board"). The memorandum purported to apprise the Board of potential issues arising under the attorney-client privilege using three different "scenarios, " each involving an unnamed "Director X." Defendants have moved to dismiss on three grounds: (1) the statements forming the basis for plaintiff's defamation claims are incapable of having defamatory meaning; (2) the statements at issue are subject to the common interest privilege; and (3) plaintiff's alleged injury is not cognizable under defamation law. (Dkt. #24.) Although a close question in light of the context and arguably innocuous indirect nature of the defamatory statements, the court will nevertheless deny defendants' motion for the reasons set forth below.


         A. The Parties

         Plaintiff Vince Amoroso is a citizen of Florida, where he resides. From 2003 until 2014, Amoroso served as a member on the Board of Directors of Sentry Insurance, which has its principal place of business in Stevens Point, Wisconsin.

         Defendants Dale R. Schuh, Kenneth Erler and Peter McPartland all reside in and are citizens of Wisconsin, as well as officers of Sentry Insurance during the times relevant to this lawsuit. Schuh was the Chief Executive Officer of Sentry and Chairman of its Board; Erler was Sentry's Senior Vice President, Chief Administrative Officer and General Counsel; McPartland was Sentry's President, later succeeding Schuh as Chief Executive Officer and Chairman of the Board. Finally, defendant James Pearson is a citizen of Illinois and was Chairperson of Sentry's Governance Committee during the times relevant to this lawsuit.[1]

         B. Board Membership

         Amoroso was a member on Sentry's Board from 2003 until 2014, for which he received about $200, 000 per year in compensation. Between 2003 and 2012, Amoroso was elected to consecutive three-year terms, consistent with Sentry's Governance Committee customary practice of recommending to re-elect a Board member whose term is expiring at a regularly scheduled Board meeting in November. At a meeting in the following February, the Board would then "perfunctorily adopt[] the recommendation of the Governance Committee." (Compl. (dkt. #1) ¶ 53.) Finally, during a meeting the following April, the Board's selections are typically re-elected.[2] (Id.)

         With respect to his own qualifications, Amoroso has been a practicing actuary for more than 40 years. He became a member of Sentry's Audit Committee in 2003, chairing it between 2006 and 2011. Amoroso further asserts that until his removal in 2014, Sentry's Board of Directors had consistently included an actuary as a member since the early 1980s.

         C. The Attorney-Client Privilege Memorandum

         After a Board meeting on February 26, 2012, Amoroso alleges that defendants Schuh or Erler developed three "scenarios, " each involving a director referred to only as "Director X." Those scenarios were then set forth in a memorandum titled "Application of the Attorney-Client Privilege, " which was attached to another a memorandum titled "Overview of the Attorney-Client Privilege and Work Product Doctrine." (Defs.' Opening Br. Ex. A (dkt. #25-1) ECF 2.) An accompanying cover letter explains that the two memoranda were being circulated in response to requests by "a number of Directors" after the February 26 Board meeting for "updated information relating to the handling of sensitive information, and the Attorney-Client Privilege." (Id.) The cover letter further explains that "[t]he second memo applies these concepts in specific situations and is self explanatory." (Id.)

         Despite the expressly stated purposes of the memoranda, plaintiff nevertheless asserts that the three scenarios "were prepared with false statements of fact in order to disparage [him] and with the purpose . . . [of] inducing members of the Governance Committee and Board of Directors to remove or not re-nominate [him] to the Board[.]" (Compl. (dkt. #1) ¶ 17.) Although the second memorandum only named a generic "Director X, " plaintiff further asserts that the recipients knew he was the individual to whom the memorandum referred. (Id. at ¶ 16.)

         D. The Three Scenarios

         In the opening scenario set forth in the second memorandum, Director X "uses unfortunate terminology describing [an] actuarial methodology" in emails sent to auditors outside of the company, which is involved in litigation with the IRS. (Compl. (dkt. #1) ¶ 18.) Plaintiff alleges that when he complained this scenario was inaccurate, Erler informed him that Director X's use of "unfortunate terminology" is actually referring to Amoroso's use of the term "cushion" in a first draft of a memo. (Id. at ΒΆ 19.) Plaintiff asserts that this first scenario is still misleading because (1) "cushion" was removed in the final version of ...

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