Mary Carroll v. Merrill Lynch

In the
United States Court of Appeals
For the Seventh Circuit
No. 12-1076
M ARY C ARROLL,
Plaintiff-Appellant,
v.
M ERRILL L YNCH, JIM K ELLIHER, and
P AT K ELLIHER,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 07-CV-01575—Rebecca R. Pallmeyer, Judge.
A RGUED S EPTEMBER 24, 2012—D ECIDED O CTOBER 16, 2012
Before B AUER, F LAUM, and H AMILTON, Circuit Judges.
F LAUM, Circuit Judge. On Thanksgiving Day at about
9:00 PM , Mary Carroll telephoned one of her co-workers,
Jim Kelliher. Hearing Ms. Carroll loudly yelling at her
husband over the phone, Jim Kelliher’s wife Pat Kelliher
began listening in on the call and decided to record the
conversation. The call ultimately cost Carroll her job, and
she sued under the Illinois eavesdropping statute for
the recording and re-playing of the call. The district
2 No. 12-1076
court granted defendants’ motion for summary judg-
ment, concluding that the recording fell within the
statute’s fear of crime exemption. Because Ms. Carroll
offers no evidence creating a genuine issue of material
fact and defendants are entitled to judgment as a matter
of law, we affirm.
I. Background
A. Factual Background
In 2005, Mary Carroll and Jim Kelliher were co-workers
at Merill Lynch. That same year, Ms. Carroll lodged a
complaint with human resources that led to the firing
of two other Merrill Lynch employees. Restructuring of
employment responsibilities followed and a super-
visory position opened up. Although Carroll said she
was not interested in the position and did not apply,
she nevertheless felt “overlooked” when Merrill Lynch
hired someone else.
In October 2005, Ms. Carroll felt that Jim Kelliher—who
apparently was not involved with Carroll’s previous
human resources complaint—was performing some of
her job duties. Around 9:00 PM on Thanksgiving in
2005, Ms. Carroll called Jim Kelliher on his home phone
to confront him about this perceived encroachment.
As Carroll later admitted, she was “all riled up,” “angry,”
and “enraged.” She also described her behavior as “inap-
propriate[]” and “irrational[],” explaining to co-workers
that she had “fucking snapped.” Carroll even recognized
the startling nature of her call, admitting that, if she
No. 12-1076 3
had received a similar call, she would have felt “threat-
ened.”
Pat Kelliher overheard Carroll’s loud accusations
blaring from the phone. Becoming concerned, she began
listening in on the phone call from another receiver in
a different room. As Ms. Carroll’s rant continued, Pat
Kelliher became increasingly concerned and upset. She
pushed the “record” button on her answering machine
and recorded the rest of the call. Pat Kelliher later ex-
plained why she made the recording:
Because I was scared. You know, it was late on
Thanksgiving night. It was past 9:00 o’clock at night.
There’s somebody on the other end yelling at my
husband and using profanity, and I hear my
husband saying, “I don’t know what you’re talking
about.” “Can you please explain?” I hear him,
you know, in a calm voice. I hear an escalation in
the voice of the person who was calling. I had no
clue who this person was. I got scared that some-
body was very angry for an unknown reason that
I could tell in the part that I listened to, and I felt
that, you know, this person was going to come to
our house, throw a brick through our window, that
they were going to do something that night. And I
got scared. And I wanted—that if we had to involve
the police that I could say “You know what? This
person, I don’t know who they are, but this is
what’s scaring me.”
When the call finally ended, Pat Kelliher told her hus-
band, “I’m scared and I think we should call the police.”
4 No. 12-1076
Despite Pat Kelliher’s concerns, the Kellihers did not
call the police that night. Jim Kelliher did call his super-
visor at Merrill Lynch, though, and reported Ms. Carroll’s
phone call. The next day, at his supervisors’ request,
Jim Kelliher played the recording. After work that day,
the Kellihers reported Carroll’s call to the police.
Two months later, in January 2006, Ms. Carroll filed
her own police report, accusing the Kellihers of vio-
lating the Illinois eavesdropping statute. The following
month, Merrill Lynch fired Carroll for her conduct on
the call, and she then filed this suit against Jim Kelliher,
Pat Kelliher, and Merrill Lynch. Among other claims,
her complaint alleged civil violations of the eaves-
dropping statute arising from Pat Kelliher’s recording
of the call and the subsequent use of the recording by
Jim Kelliher and Ms. Carroll’s supervisors at Merrill
Lynch.1
B. Procedural Background
Before the district court, defendants moved for
summary judgment. They also moved to strike Carroll’s
response to the statement of undisputed facts and
her statement of additional facts. The district court recog-
1
Ms. Carroll’s other claims included sex discrimination,
hostile work environment, and retaliation claims under
Title VII; breach of contract; violations of the Illinois Wage
and Payment Collection Act; tortious interference; intrusion
upon seclusion; and intentional infliction of emotional distress.
No. 12-1076 5
nized deficiencies in these filings, which did not
conform to Local Rule 56.1(b)(3), but nevertheless
refused to strike the deficient pleadings and instead
“attempted to identify disputes of fact.” Carroll v. Merrill
Lynch, No. 1:07-cv-01575, 2011 WL 1838563, at *1 n.1 (N.D.
Ill. May 13, 2011). Where Ms. Carroll did “not offer a
statement responsive to Defendants’ facts,” though, the
district court accepted defendants’ version as true. Id.Reaching the merits of the summary judgment
motion, the district court held for defendants on all
claims, finding no genuine dispute as to material fact. Id.
at *24. Ms. Carroll now appeals only the district court’s
grant of summary judgment on her claim that Pat
Kelliher’s recording violates the Illinois eavesdropping
statute.
II. Discussion
Defendants are entitled to summary judgment on the
eavesdropping claims. We review motions for sum-
mary judgment de novo. Bennett v. Roberts, 295 F.3d
687, 694 (7th Cir. 2002). Summary judgment is proper
when, viewing all facts and inferences in favor of the non-
moving party, no genuine dispute as to material fact
exists, and the moving party is entitled to judgment as
a matter of law. Fed. R. Civ. P. 56(a); Hudson Ins. Co. v.
City of Chi. Heights, 48 F.3d 234, 237 (7th Cir. 1995).
Illinois law prohibits recording a telephone con-
versation without the consent of all parties. 720 ILCS
5/14-2(a)(1). It also prohibits the subsequent use or dis-
6 No. 12-1076
semination of any information obtained through an
unauthorized recording. Id. at § 2(a)(3). The fear of crime
exemption, however, allows unconsented recordings
when: (1) the recording is made by or at the request of
a person who is a party to the conversation; (2) under a
reasonable suspicion that another party to the conversa-
tion is committing, is about to commit, or has committed
a criminal offense against that person or a member of
his or her immediate household; and (3) the recording
may yield evidence of that criminal offense. Id. at § 3(i).
On appeal, Ms. Carroll principally challenges only
the second element—whether Pat Kelliher had a rea-
sonable suspicion to believe that Carroll was committing,
was about to commit, or had committed a criminal
offense against Pat Kelliher or someone in her immedi-
ate household.2 She argues both that genuine disputes
2
The fear of crime exemption only authorizes recordings
made by or at the request of a “party to the conversation.” 720
ILCS 5/14-3(i). Arguably, Pat Kelliher was not a party to the
conversation because she did not participate vocally. See id.
at § 1(d) (defining conversation as an “oral communication
between 2 or more persons”). Nevertheless, Ms. Carroll did not
raise this argument before the district court or in her opening
brief. When she finally did raise this argument in her reply
brief, she cursorily did so in only one sentence. As a conse-
quence, this argument is waived. See Coleman v. Hardy, 690
F.3d 811, 818 (7th Cir. 2012) (argument not raised before
district court waived); Crawford v. Countrywide Home Loans,
Inc., 647 F.3d 642, 650 (7th Cir. 2011) (“underdeveloped argu-
(continued...)
No. 12-1076 7
of material fact exist and that defendants are not en-
titled to judgment as a matter of law. Additionally, she
argues that the fear of crime exemption does not apply
to the statute’s ban on use or dissemination of unautho-
rized recordings.
A. No Genuine Disputes of Material Fact Exist to Pre-
clude Summary Judgment.
Not all disputes of fact preclude summary judgment.
Such factual disputes must be both material and genuine.
Fed. R. Civ. P. 56(a). The underlying substantive law
governs whether a factual dispute is material: “irrelevant
or unnecessary” factual disputes do not preclude
summary judgment. Anderson v. Liberty Lobby, Inc., 477
U.S. 242, 248 (1986). And a factual dispute is genuine
when “the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.” Id. Once the
moving party puts forth evidence showing the absence
of a genuine dispute of material fact, the burden shifts
to the non-moving party to provide evidence of specific
facts creating a genuine dispute. Hudson Ins. Co., 48 F.3d
at 237. Mere “metaphysical doubt as to the material
facts” is not enough. Matsushita Elec. Indus. Co. v. Zenith
Radio Corp., 475 U.S. 574, 586 (1986).
Ms. Carroll accuses the district court of making
improper credibility determinations and failing to
2
(...continued)
ment” waived); Dye v. United States, 360 F.3d 744, 751 n.7
(7th Cir. 2004) (argument first raised in reply brief waived).
8 No. 12-1076
construe all factual disputes in her favor. According
to Carroll, the district court improperly credited Pat
Kelliher’s testimony that a fear of crime motivated her
to record the conversation. But nothing requires the
district court to disbelieve defendants’ proffered
evidence simply because Ms. Carroll—without proof—
asserts it is false. See Argyropoulos v. City of Alton, 539
F.3d 724, 732 (7th Cir. 2008) (noting inferences “sup-
ported by only speculation or conjecture” do not create
genuine issue of fact (citation omitted)); see also
Koclanakis v. Merrimack Mut. Fire Ins. Co., 899 F.2d 673,
675 (7th Cir. 1990). Indeed, the law requires just the
opposite: Ms. Carroll cannot rest on “metaphysical
doubt” that Pat Kelliher lied but must produce evidence
so showing. See Matsushita Elec. Indus. Co., 475 U.S. at
586. She has not done so.
Instead, all Ms. Carroll offers is the suggestion of an
economic motive behind the recording. True, Pat Kelliher
expressed some worry that Carroll might jeopardize
her husband’s job. This evidence does not contradict
her testimony that she feared commission of a crime so
it does not create a genuine issue of material fact. See Bd.
of Trs. of Univ. of Ill. v. Ins. Corp. of Ir., Ltd., 969 F.2d
329, 334-35 (7th Cir. 1992) (no genuine issue of material
fact where non-moving party’s evidence did not contra-
dict that of moving party); see also Unterreiner v.
Volkswagen of Am., Inc., 8 F.3d 1206, 1212 (7th Cir. 1993)
(no genuine issue of material fact when non-moving
party’s evidence is “merely colorable, or is not sufficiently
probative”). As Carroll’s counsel admitted at oral argu-
No. 12-1076 9
ment, these two fears are not mutually exclusive.3 Thus,
in granting summary judgment, the district court simply
relied on Pat Kelliher’s unrebutted testimony that she
feared “any number of” crimes and that this fear
motivated her recording. Ms. Carroll’s argument other-
wise is nothing more than a “mere unsupported de-
nial[]” of Pat Kelliher’s testimony and does not create
a genuine dispute of material fact. See Koclanakis, 899
F.2d at 675.
Ms. Carroll’s reliance on her account of Jim Kelliher’s
conduct on the call fares no better in creating a genuine
issue of material fact. Even assuming Carroll truthfully
recalled that Jim Kelliher also yelled on the call, no rea-
sonable jury could find that Pat Kelliher did not fear
criminal activity given Ms. Carroll’s own admissions
that she yelled and cursed at Jim Kelliher. See Outlaw
v. Newkirk, 259 F.3d 833, 838 (7th Cir. 2001) (no genuine
issue of fact when “defendants would be entitled to
summary judgment even assuming the truth of [plain-
tiff’s] version of the incident”). Thus, while this testi-
3
Ms. Carroll’s assertion that the district court applied a “mixed
motive” standard to this question is equally without merit—
it merely recasts from a different mold her argument that the
district court made credibility determinations. Additionally,
Carroll also asserts in her reply brief that, without trial,
she could not present evidence contradicting Pat Kelliher’s
deposition testimony. She could have proffered this evidence
as a sworn statement attached to her papers opposing the
summary judgment motion, though. See Fed. R. Civ. P. 56(c)(4);
cf. Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986).
10 No. 12-1076
mony creates a factual dispute, it does not generate a
genuine dispute of material fact that precludes sum-
mary judgment.
Finally, citing Glinski v. City of Chicago, Ms. Carroll
suggests that her inability to cross-examine Pat Kelliher
creates a genuine issue of material fact. Glinski v. City of
Chi., No. 99 C 3063, 2002 WL 113884, at *7-8 (N.D. Ill.
Jan. 29, 2002). But this places on Glinski an analytical
load too heavy for that case to bear. Glinski did, as
Carroll correctly asserts, recognize that the reasonable
suspicion determination in that case “depend[ed] on the
credibility of [the recorder’s] testimony.” Id. at *8. The
reasonable suspicion determination in this case, how-
ever, does not hinge on Pat Kelliher’s credibility:
Ms. Carroll’s own testimony corroborates Pat Kelliher’s
account of Carroll’s conduct on the call. Moreover,
“neither a desire to cross-examine an affiant nor an un-
specified hope of undermining his or her credibility
suffices to avert summary judgment.” Nat’l Union Fire
Ins. Co. of Pittsburgh, Pa. v. Argonaut Ins. Co., 701 F.2d 95,
97 (9th Cir. 1983). And an unspecified hope of under-
mining Pat Kelliher’s credibility is all Carroll offers—she
provides no evidence of specific facts suggesting that
Pat Kelliher lied about her fear of crime or that Pat Kelliher
otherwise lacks credibility.4 Consequently, Ms. Carroll’s
bare desire to cross-examine Pat Kelliher does not
defeat defendants’ summary judgment motion.
4
As explained below, Carroll’s suggestion that Pat Kelliher
suffered from psychological issues predisposing her to fearful-
ness completely lacks factual support.
No. 12-1076 11
At bottom, defendants have proffered evidence that
a fear of crime motivated Pat Kelliher’s recording of the
phone call.5 Carroll offers no evidence of specific facts
contradicting or undermining this conclusion so no
genuine dispute of material fact exists. The district court
properly resolved this case on summary judgment.
B. Defendants Are Entitled to Judgment as a Matter
of Law Because the Undisputed Facts Show That
the Fear of Crime Exemption Applies.
The Illinois eavesdropping statute exempts certain
recordings made with a reasonable suspicion that the
caller is committing or may commit a crime against
the person requesting the recording or someone in that
person’s immediate household. 720 ILCS 5/14-3(i). Thus,
the exemption requires (1) a subjective suspicion that
criminal activity is afoot, and (2) that the suspicion be
objectively reasonable. Cf. People v. Allen, 950 N.E.2d
1164, 1177 (Ill. App. Ct. 2011) (requiring objective rea-
sonableness for reasonable suspicion in criminal case);
see also Ornelas v. United States, 517 U.S. 690, 696-97
5
Ms. Carroll also asserts that Pat Kelliher “presented not a
single fact to support ANY of her Affirmative Defenses” and
that “summary judgment is proper Against [sic] P. Kelliher
in ALL of her pled Affirmative Defenses including the exemp-
tion defense.” (Emphasis in original.) Setting aside that this
statement badly distorts the record, Ms. Carroll never moved
for summary judgment so her request on appeal for sum-
mary judgment against defendants lacks merit.
12 No. 12-1076
(1996). Pat Kelliher’s fears arising from Carroll’s conduct
on the phone call satisfy both of these requirements.6
First, Ms. Carroll continues arguing that Pat Kelliher
feared, not commission of a crime, but rather that Carroll
would report her dispute with Jim Kelliher to the
human resources department at Merrill Lynch. Because
such a report is not criminal, she argues, Pat Kelliher’s
recording falls outside the fear of crime exemption. But
Ms. Carroll ignores Pat Kelliher’s unrebutted testimony
that she feared the caller might vandalize her home
that night. Indeed, Carroll’s call itself may have been
criminal: Illinois criminalizes phone calls made “with
intent to abuse, threaten or harass any person at the
called number.” 720 ILCS 135/1-1(2). Thus, this case
differs from People v. Nestrock, where neither defendant
actually suspected or feared criminal activity.7 See 735
N.E.2d 1101, 1108 (Ill. App. Ct. 2000). Thus, defendants
6
Ms. Carroll also suggests that Pat Kelliher’s recording falls
outside the exemption because Carroll threatened Jim Kelliher,
not Pat Kelliher. The statute clearly forecloses this argument:
it permits a recording when the person reasonably suspects
the commission of a crime “against the person [recording
the conversation] or a member of his or her immediate household.”
720 ILCS 5/14-3(i) (emphasis added).
7
Ms. Carroll’s reliance on In re Marriage of Almquist, 704 N.E.2d
68, 70-71 (Ill. App. Ct. 1998), is also misplaced. The exemption
did not apply in that case because the subject of the recording
was not the person feared to commit the crime. Id. Here,
Carroll was both the person recorded and the person Pat
Kelliher feared might commit a crime against Jim Kelliher,
satisfying the exemption’s statutory requirements.
No. 12-1076 13
have offered sufficient evidence establishing that Pat
Kelliher subjectively feared criminal conduct against her
husband.
Next, Ms. Carroll launches a volley of arguments at-
tacking the reasonableness of Pat Kelliher’s fear. All
agree—even Carroll—on the threatening and abusive
nature of the call. Given this agreement, Pat Kelliher’s
fear of crime is reasonable. Carroll’s own testimony
establishes this: she acknowledges that she was “en-
raged,” “all riled up,” and had “fucking snapped”; and
that she used profanity. These facts parallel McWilliams
v. McWilliams, where the recorded individual made
“repeated threats” and showed “aggression” against
those who made the recording. No. 06 C 3060, 2007 WL
1141613, at *8 (N.D. Ill. Apr. 16, 2007). Ms. Carroll’s
attempt to distinguish McWilliams is unavailing. She
lists numerous factual differences that, in her view, set
McWilliams apart. These differences, however, have no
connection to the statutory text—they do not change
the fact that, however this case differs from McWilliams,
it still satisfies the elements of the fear of crime exemp-
tion.8 Moreover, that Carroll did not make death threats,
8
For example, in McWilliams, police were present during the
recording, the recording was based on prior unrecorded calls,
the caller was aware of the recording, the caller was arrested
and the recording used in subsequent criminal proceedings,
the recording was not used in making employment decisions,
and the recording was immediately turned over to the police.
2007 WL 1141613, at *1-2, 8. Applicability of the exemption,
(continued...)
14 No. 12-1076
as the caller in McWilliams did, 2007 WL 1141613, at *8,
is irrelevant. The exemption applies to any crime, not
just homicide.
Ms. Carroll next accuses Pat Kelliher of having
“personal mental problems” that predispose her to “fear-
fulness,” making her suspicion of crime unreasonable.
Even assuming that psychological propensities do influ-
ence the reasonableness determination, Carroll offers
no evidence that Pat Kelliher did, in fact, have personal
mental problems predisposing her to fearfulness. The
only record support to which Carroll points is Pat
Kelliher’s admission that she on occasion sought the
counseling of clergy. Such counseling in no way
suggests the presence of “personal mental problems,” a
condition that Pat Kelliher actually denied. Moreover,
the transcript excerpt on which Ms. Carroll relies does
not even mention fearfulness. In any event, as explained
above, Carroll’s own deposition testimony provides
sufficient factual support for the reasonableness of
Pat Kelliher’s suspicions of criminal conduct.
Finally, Ms. Carroll argues—for the first time in her
reply—that the state’s decision not to prosecute her for
the phone call shows that Pat Kelliher’s fear of crime
was unreasonable. See Blount v. Stroud, 915 N.E.2d 925,
950 n.6 (Ill. App. Ct. 2009) (noting absence of prosecu-
8
(...continued)
however, does not hinge on any of these facts. Thus, their
absence from the circumstances surrounding Pat Kelliher’s
recording, which independently satisfies the exemption’s
elements, does not distinguish McWilliams.
No. 12-1076 15
tion for eavesdropping in concluding fear of crime ex-
emption would likely apply). Because not raised in her
opening brief, Ms. Carroll has waived this argument.
See Dye, 360 F.3d at 751 n.7. Even so, the exemption
does not require proof beyond a reasonable doubt or
even the probable cause required for arrest or indict-
ment. Instead, it requires something far less—reasonable
suspicion. See Terry v. Ohio, 392 U.S. 1, 27 (1968). Thus, that
the district attorney did not charge Carroll with any
crime—either telephone harassment or something else—
does not preclude Pat Kelliher from reasonably believing
that Carroll was committing or would commit a crime
against Jim Kelliher.
Ultimately, the undisputed facts reveal that Pat
Kelliher worried that the unidentified, threatening caller
might commit a crime against her husband and that
fear was reasonable. Thus, her recording satisfies the
fear of crime exemption under the Illinois eavesdropping
statute, and summary judgment for the defendants is
proper.
C. Because the Fear of Crime Exemption Applies,
No Continued Use Violations Occurred.
In addition to making recordings without consent,
the eavesdropping act also prohibits “us[ing] or
divulg[ing] . . . any information which [a person] knows
or reasonably should know was obtained through the
use of an eavesdropping device.” 720 ILCS 5/14-2(a)(3).
Ms. Carroll now argues that the fear of crime exemption
does not apply to this provision of the eavesdropping
statute.
16 No. 12-1076
Section 5/14-3, which contains the fear of crime exemp-
tion, explains that the “following activities shall be
exempt from the provisions of this Article.” Thus, the
exemptions apply to all parts of the eavesdropping act,
including the prohibition on using and divulging re-
corded information. Ms. Carroll offers no Illinois author-
ity—and we have found none—permitting the disre-
gard for the plain text of the statute that her argument
requires. Senator Dillard’s floor statements, which reveal
one statutory purpose of allowing private individuals
to collect evidence to assist a future criminal prosecu-
tion, are not to the contrary. See 1996 Ill. Att’y Gen. Op.
No. 036 (quoting Senate Debates, 88th Ill. Gen. Assem.,
Apr. 21, 1994, at 139-40 (statement of Sen. Kirk
Dillard)). Nothing in this statement and—more impor-
tantly, nothing in the text—limits the fear of crime exemp-
tion to the particular use of re-playing the recording to
assist in a criminal prosecution. Consequently, because
the fear of crime exemption applies to all parts of the
eavesdropping act and because Pat Kelliher’s re-
cording falls within this exemption, Jim Kelliher and
other Merrill Lynch employees did not violate the eaves-
dropping act when they re-played the recording
of Ms. Carroll’s call for Carroll’s supervisors at
Merrill Lynch.9
9
Because defendants’ conduct falls within the fear of crime
exemption, we need not reach the district court’s conclusion
that Carroll suffered no damages from the recording.
No. 12-1076 17
III. Conclusion
For the foregoing reasons, we A FFIRM the district
court’s grant of summary judgment for defendants.
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