United States District Court, D. New Mexico
Stephen P. Curtis, Attorney at Law, P.C., Albuquerque, New
Mexico, for Plaintiff.
Franse and Krystle A. Thomas, Rodey Dickason Sloan Akin &
Robb P.A., Albuquerque, New Mexico, for Defendant Heartland
Payments Systems LLC.
MEMORANDUM OPINION AND ORDER GRANTING DEFENDANT
HEARTLAND PAYMENT SYSTEMS LLC'S MOTION FOR SUMMARY
KELLY, JR. UNITED STATES CIRCUIT JUDGE.
MATTER is before the court on Defendant Heartland Payment
Systems LLC's (Heartland) Motion for Summary Judgment
(ECF No. 29). Upon consideration thereof, the court finds the
motion is well taken and should be granted.
2003, Tonya Sutton was hired by Heartland, a company that
offers payment processing, payroll, and other financial
services. Compl. at 2 (ECF No. 1-1); About Us,
Heartland Payment Systems,
visited May 2, 2019). Before joining Heartland, Ms. Sutton
worked for what was then Morgan Stanley Dean Witter's
Discover Card business selling various financial services
products. Compl. at 1. She accepted an early retirement
package from Morgan Stanley, but one condition of her
retirement was a noncompete agreement. Id. According
to Ms. Sutton, she was then hired by Heartland with the
expectation that she would train one of Heartland's
existing employees, Joseph Rigsby, Sr., and use her knowledge
of the financial industry from Morgan Stanley to acquire
clients for Heartland. Id. at 2. By pairing Ms.
Sutton with Mr. Rigsby, Heartland was able to solicit Ms.
Sutton's Morgan Stanley clients without triggering her
noncompete agreement. Id She claims that this
arrangement continued throughout her three years at Heartland
and was so successful that Mr. Rigsby was promoted to
Division Manager for New Mexico. Id. Ms. Sutton
retired from Heartland in 2006, but she says that she
continued to be involved in Heartland business by assisting
Mr. Rigsby (who was still a Heartland employee) in bringing
in new clients. Id.
time she retired from Heartland, Ms. Sutton claims she was
the owner of a “Heartland Portfolio Account.”
Id. This account was a form of deferred income and
performance compensation tied to the number of clients she
had recruited - the amount in the portfolio account was tied
to the number of clients, retention of clients, length of
time as a client, and each client's volume of services
used. Final Decree of Dissolution of Marriage at 5,
⁋⁋46-51 (ECF No. 29-1, Ex. A) (“Divorce
Decree”); Pl.'s Resp. Mot. Summ. J. at 5 n.1 (ECF
No. 38). Ms. Sutton states that at the time of her retirement
she was the owner of and “fully vested” in her
portfolio account. Compl. at 2-3, ¶¶ 16-17.
2004, Ms. Sutton married Mr. Rigsby, but by 2009 the couple
had separated and begun divorce proceedings. Id. at
2; Divorce Decree at 1, ⁋4. A final decree of
dissolution of their marriage was entered in New Mexico state
court on May 16, 2011. Divorce Decree at 1. The final decree
made a number of findings, including a tally and division of
their individual and marital assets. See generally
id. The divorce court also entered a Qualified Domestic
Relations Order (QDRO), within the meaning of the Employee
Retirement Income Security Act of 1974 (ERISA), that named
Ms. Sutton an alternate payee of Mr. Rigsby's 401(k)
retirement account managed by Heartland. Qualified Domestic
Relations Order at 38-39, ⁋⁋2, 7-9 (ECF No. 1-1,
of the divorce proceedings, Ms. Sutton says she discovered
that Heartland and Mr. Rigsby had stolen the value of her
Heartland portfolio account from her. Compl. at 3. At some
time after her marriage to Mr. Rigsby, she claims that
Heartland merged her portfolio account with Mr. Rigsby's
portfolio account without her knowledge. Id. She
claims Mr. Rigsby was aware of the merger of their accounts,
and she claims that her portfolio account was worth more than
$300, 000 at the time. Id. at 3, 5. According to Ms.
Sutton, Heartland allowed Mr. Rigsby to cash in the portfolio
account and receive funds that rightly belonged to her.
Id. at 3. In addition to merging her portfolio
account, Ms. Sutton also claims that Heartland failed to pay
benefits from Mr. Rigsby's 401(k) account as required by
the QDRO. Id. at 4-5.
10, 2018, Ms. Sutton sued Heartland and Mr. Rigsby in New
Mexico state court for (1) breach of contract, (2)
conversion, (3) unjust enrichment, and (4) conspiracy.
See Compl. Heartland removed the case on the ground
that Ms. Sutton's claims regarding Mr. Rigsby's
401(k) account were completely preempted by ERISA §
502(a). See Notice of Removal (ECF No. 1). Ms.
Sutton moved to remand, but this court denied that motion.
See Mem. Op. & Order Denying Pl.'s Mot.
Remand, Sutton v. Heartland Payment Sys. LLC, No.
1:18-cv-00723-PJK-KK, 2019 WL 1795536 (D.N.M. Apr. 24, 2019)
(ECF No. 44) (“Remand Order”). Heartland also
moved for summary judgment on the ground that all of Ms.
Sutton's claims against it are barred by limitations and
that it is entitled to judgment as a matter of law on the
undisputed material facts. Def.'s Mot. Summ. J. Mr.
Rigsby, meanwhile, has not appeared in this
motion for summary judgment should be granted when there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a).
The court views the factual record and reasonable inferences
that may be drawn from it in the light most favorable to the
nonmoving party. Banner Bank v. First Am. Title Ins.
Co., 916 F.3d 1323, 1326 (10th Cir. 2019). The court
already determined that ERISA governs Count II of Ms.
Sutton's complaint. Remand Order at *2. The parties
appear to agree that New Mexico law governs the remaining
state-law claims. See, e.g., Def.'s Mot. Summ.
J. at 9-11; Pl.'s Resp. at 4-5.
Count I: Claims Against Heartland for the Portfolio
Sutton's complaint alleges that Heartland committed the
tort of conversion when it merged her portfolio account with
Mr. Rigsby's portfolio account without her permission or
knowledge. Compl. at 2-4. She seeks damages in the amount of
the account's worth at the time it was converted, or
$300, 000. Id. at 3. Heartland responds that Ms.
Sutton is time barred because she knew or should have known
that she had no separate portfolio account by May 16, 2011.
Def.'s Mot. Summ. J. at 9-10. New Mexico has a four-year
statute of limitations for conversion of personal property,
N.M. Stat. Ann. § 37-1-4 (West 1978), so the ...