In the

United States Court of Appeals

For the Seventh Circuit

No. 08-3420

VALERIE MCCANN and LESLIE LINDBERG,

Plaintiffs-Appellants,

v.

IROQUOIS MEMORIAL HOSPITAL, et al. 

Defendants-Appellees.

Appeal from the United States District Court

for the Central District of Illinois.

No. 06-2176—Harold A. Baker, Judge.

ARGUED MARCH 31, 2009—DECIDED SEPTEMBER 13, 2010

Before FLAUM, MANION, and ROVNER, Circuit Judges.

ROVNER, Circuit Judge. Behind a closed office door,

two co-workers at Iroquois Memorial Hospital, Valerie

McCann and Dr. Leslie Lindberg, had a conversation

in which they criticized hospital administration. Unbeknownst to them, their conversation was recorded by a

dictation machine, transcribed, and handed to those

they criticized. Believing that the recording was illegally
2 No. 08-3420

obtained, disclosed, and used against them, they sued

another employee, Susan Freed, along with the hospital,

its Board of Trustees, and its Chief Executive Officer,

Stephen Leurck, under the Wiretap Act, 18 U.S.C.

§§ 2511, 2520. McCann and Lindberg believe that Freed

came into Lindberg’s office while they were talking, and

that while she was out of their line of sight picking

up papers next to Lindberg’s dictation machine, she

deliberately turned on the machine to record their conversation. Freed responds that she interrupted a conversation of theirs once but not on the date of the

taped conversation, and posits that Lindberg forgot to

turn off his dictation machine when McCann entered

his office. The district court granted summary judgment

for the defendants, based largely on inferences drawn

from the recording itself. But because the parties presented two different but plausible stories, an issue of fact

remains. We conclude that the claims against Freed and

the hospital boil down to a swearing contest and should

not have been resolved on summary judgment. Even

if Freed acted unlawfully, however, the evidence

does not show that CEO Leurck knew that, and the

only trustee who might have known did not use or

disclose the recording, so we affirm the summary judgment of the claims against Leurck and the trustees.

I. Background

This saga begins with McCann’s termination from

the hospital, which she resented. McCann was formerly

the director of physicians’ services, but in early Feb-
No. 08-3420 3

ruary 2006, she and several other employees were given

a week to resign and told that if they resigned by February 10 they could apply for new positions. McCann

thought that this reorganization was really a way for

the then new CEO Stephen Leurck to get rid of people

he did not like, and she thought she was a target.

McCann tried to meet with Leurck to discuss the possibility of a new position, but he did not meet with her

until February 10. The upshot of the meeting was that

she no longer had a job at the hospital and would not

be considered for a new one.

Around the same time, Leurck and the Board of

Trustees were also reorganizing the radiology department. This put Lindberg’s radiology services to the

hospital at risk. The hospital used the services of

Lindberg along with another group of doctors, but it

voted to use only one provider in the future. They

asked Lindberg and others to submit proposals if they

wished to be considered for the position of exclusive

provider, but Lindberg’s proposal would have required a second, unnamed provider along with him.

Lindberg disapproved of the way the administration

was handling things, and the administration was not

particularly happy with him either. Freed, who oversaw the staff who transcribed the radiologists’ dictated

reports, emailed Leurck and another administrator,

Susan Berg, complaining about Lindberg’s dictation

habits—apparently he began late in the day—and their

effect on her staff and patient care. Berg added that

Lindberg “let ‘politics’ get in the way of patient care

and safety.”
4 No. 08-3420

On the afternoon of February 24, 2006, McCann went

to visit Lindberg in his office. She no longer worked

for the hospital, but she still worked for the Independent

Physicians Association, of which Lindberg was president, and she needed Lindberg to sign some checks for

the Association. When McCann arrived, Lindberg was

dictating a radiology report into his dictation machine.

He says that he turned the machine off, and the two

exchanged greetings. According to McCann and Lindberg,

while they were talking Freed entered the office without knocking. Freed crossed out of their line of sight,

picked up some requisition forms that were next to

Lindberg’s dictation machine, and left. According to

Freed, she wanted to minimize her interruption and left

the office as quickly as she could. She generally remembered the same sequence of events, but contended that

it occurred on February 10 rather than February 24. Freed

denied being in Lindberg’s office on the 24th.

Somehow, the dictation machine was turned on in midconversation between Lindberg and McCann. The timestamp on the tape—which the parties acknowledge

cannot be changed—shows that Lindberg last entered

the bar code for a new patient at 3:17p.m. on February 24.

He dictated into the machine for just under two minutes. After Lindberg’s last sentence of medical dictation, there is a clicking sound, and the recording picks

up again in the middle of a sentence in which McCann

is discussing the checks she brought for Lindberg to

sign. McCann and Lindberg say that some preliminary

pleasantries to their conversation were not captured on

the recording.
No. 08-3420 5

The conversation eventually turned to events at the

hospital of which the two were critical. The two discussed the reorganization in radiology and what it

would mean for Lindberg, and he asked McCann how

she thought the other doctors would fare under the

reorganization. McCann described what she saw as

Leurck’s “pecking order”—a sort of hit list —and Lindberg

was at the top. Both McCann and Lindberg criticized the

trustees and especially Leurck. During the conversation

McCann received a call on her cell phone and spoke

briefly about an event she was attending later that day.

The call was from her home, and phone records show

it was placed at 3:24p.m. At the end of the conversation,

McCann noted that she was running late and needed

to leave, and the tape reflects the sound of a door closing.

Soon thereafter, Lindberg’s dictated reports, along

with the recorded private conversation, made their

way to another department for transcription. The transcriptionist who listened to the recording emailed Freed,

explaining that a conversation critical of the administration had been recorded. The transcriptionist assumed

that Lindberg had forgotten to turn off his dictation

machine. (The defendants point out that Lindberg had

occasionally failed to turn off the machine when he finished dictating, although he says that happened only

when his dictation microphone was broken.)

Freed listened to the conversation, advised the

transcriptionist to transcribe it, and, because she thought

it inflammatory, contacted Leurck. Freed told Leurck

that Lindberg had accidentally left on his dictation ma-
6 No. 08-3420

chine and advised Leurck to listen to the recording.

Leurck then read the transcript and listened to the recording. At a board meeting he informed the trustees

about the conversation. He also gave a copy of the transcript to one trustee while another was present in the

room. But the day after plaintiffs’ counsel sent the

hospital a letter accusing Leurck of illegally intercepting

the conversation (saying nothing of Freed), Leurck

emailed the two trustees and asked them to return the

transcript if they had it. Leurck testified that he asked

for the transcript’s return as a matter of routine business.

In an email, Leurck told the Chairman of the Board that

he thought a strong response would be appropriate,

and that Lindberg and McCann “need[ed] to be put in

their respective places.” The chairman added that the

recording “may be the crack in the door that maybe

[Lindberg] has talked once too much.” Not long afterwards, Lindberg’s privileges at the hospital were terminated, and he remains there only by virtue of an injunction entered by the Illinois state court in a separate

lawsuit. His business is down, because, he says, Leurck

told physicians not to send their radiology work to

him. As for McCann, Leurck thought she was meddling

and spending too much time hanging around the hospital. He banned her from entering the hospital for anything other than healthcare for herself or a loved one.

Lindberg and McCann sued Freed, Leurck, the

hospital, and the members of the hospital’s Board of

Trustees under the Federal Wiretap Act and various

state laws. They asserted that Freed intentionally inter-
No. 08-3420 7

cepted their conversation, in violation of 18 U.S.C.

§ 2511(a)(1), and that she disclosed the recording to

Leurck, who disclosed it to the trustees, in violation of

18 U.S.C. § 2511(c). They claimed that Freed and Leurck

acted within the scope of their employment and that

the hospital was liable for their actions. In addition,

they asserted that Leurck and the trustees used the recording’s contents to justify sanctioning Lindberg and

McCann, in violation of 18 U.S.C. § 2511(d). And they

alleged that all of the defendants knew or had reason to

know that the recording was made unlawfully, as required for liability under subsections (c) and (d). Finally,

they brought various state law claims not at issue in

this appeal.

The defendants filed for summary judgment, arguing

that Lindberg and McCann lacked evidence that Freed

had entered Lindberg’s office on the date in question.

The defendants’ argument rested largely on the plaintiffs’ initial confusion about the date of the recorded conversation: before the plaintiffs had access to the recording and its date stamp, they thought that the recorded conversation may have occurred on February 10,

and had said in their initial depositions that they

thought Freed came in that day. However, the plaintiffs

responded to the summary judgment motion with additional affidavits, noting that based on new evidence and

refreshed recollection—e.g., the date on the recording,

as well as the checks Lindberg signed and McCann’s

phone records—they realized that the conversation they

remembered, along with Freed’s interruption, occurred

on the 24th rather than the 10th. The defendants moved
8 No. 08-3420

to strike the new affidavits, contending that they were

improper attempts to rehabilitate deposition testimony.

The district court did not explicitly rule on the motion

to strike, but it found the dispute about the dates immaterial. The court granted summary judgment for the

defendants on the Wiretap Act counts and declined to

exercise supplemental jurisdiction over the remaining

state law counts. The court’s order on summary judgment was based largely on inferences drawn from the

recording itself. The district court explained that although the recording did not reflect the pleasantries

that Lindberg and McCann said they exchanged

before discussing the checks, as one would expect it to

if Lindberg had simply failed to turn off the dictation

machine when McCann entered, that did not prove that

Freed turned on the machine. Instead, it deemed the

plaintiff’s inferences “metaphysical doubt.” The district

court concluded that the recording supported Freed’s

testimony that she did not turn on the machine, and thus

that there was no intentional interception, an element

necessary to support the Wiretap Act claims against all

of the defendants.

The plaintiffs moved for reconsideration, which the

district court denied. The court reiterated that the

absence of McCann and Lindberg’s greetings was insignificant, speculating that Lindberg could have resumed

dictating while McCann produced the checks but then

failed to turn off the machine a second time. The court

also noted the absence of any sound reflecting Freed’s

exit after she purportedly turned on the machine, ob-
No. 08-3420 9

serving that when McCann left, the closing door was

audible. Finally, it thought that the interruption in recording between Lindberg’s dictation and McCann’s

voice in mid-sentence did not support the plaintiffs’

argument that there was a break between the recorded

dictation and the recorded private conversation. McCann

and Lindberg appealed.

II. Analysis

The plaintiffs’ first, and most significant, argument on

appeal is that a material issue of fact precluded summary judgment on whether Freed intentionally recorded

their conversation. In short, they contend that they

know the date and time when the recording of the private

conversation started, they know the three people who

were in the room during the different parts of the conversation, and since all three of them deny turning on

the machine, there is an issue of fact as to who did so.

The defendants raise a preliminary question: whether

we can consider the affidavits from McCann and Lindberg

suggesting that three people were in the room. They

argue that the only evidence of Freed’s presence on the

24th, as opposed to the 10th, are the affidavits that the

plaintiffs submitted in response to summary judgment.

In their view those affidavits should be disregarded

as contradicting earlier deposition testimony. The defendants point to cases saying that a plaintiff cannot

manufacture an issue of fact by submitting an affidavit

that contradicts prior sworn testimony. The rule defendants seek to apply is designed to avoid sham factual
10 No. 08-3420

issues and prevent parties from taking back concessions

that later prove ill-advised. Bank of Illinois v. Allied Signal

Safety Restraint Sys., 75 F.3d 1162, 1168-70 (7th Cir. 1996);

see Commercial Underwriters Ins. Co. v. Aires Envir. Servs.

LTD, 259 F.3d 792, 799 (7th Cir. 2001). But it applies

when the change is incredible and unexplained. Patton v.

MFS/Sun Life Fin. Distrib., Inc., 480 F.3d 478, 488 (7th

Cir. 2007). In contrast, when the change is plausible and

“the party offers a suitable explanation such as ‘confusion, mistake, or lapse in memory,’ ” a change in testimony affects only its credibility, not its admissibility.

Commercial Underwriters, 259 F.3d at 799 (quoting

Maldonado v. U.S. Bank, 186 F.3d 759, 769 (7th Cir. 1999));

Patton, 480 F.3d at 488.

We agree with the district court to the extent that it

found the confusion about the dates to be immaterial.

The affidavits do not contradict the substance of the

prior testimony—that Freed entered the office during

the plaintiffs’ conversation—and even if they are contradictory, the plaintiffs have offered a suitable explanation. The contradiction is only as to the specific date

that these events occurred, a matter that naturally

might be difficult to pinpoint without access to the recording itself. More importantly, McCann, Lindberg,

and even Freed all remembered that at some point in

February, Freed walked into Lindberg’s office while he

was talking to McCann and picked up papers from his

desk. The plaintiffs initially thought that these events

occurred February 10, the day McCann lost her job, but

when they were deposed both became uncertain and noncommittal about the date and thought they might have
No. 08-3420 11

Neither party has raised or addressed the issue of whether the 1

federal Wiretap Act requires proof that the interception or

(continued...)

talked on February 22. After they learned that the

timestamp on the recording showed that it was made

on February 24, that the checks discussed in the recording were signed on the 24th, and that the phone call

McCann took was placed on the 24th, it was reasonable

for them to conclude that they had been mistaken about

the date of the conversation, and the date of the interruption as well. Indeed, Freed herself also had trouble

recalling the date she walked into Lindberg’s office;

she first said it was February 3 and then, after consulting the obituary of her grandfather (who passed

away around that time), changed her mind and said

the date was February 10. At base, there is nothing remarkable about having difficulty remembering, or remembering incorrectly, the date that an event occurred,

and nothing inherently unbelievable about correcting

it after consulting other evidence.

Accepting the plaintiffs’ affidavits, we turn to the

question whether an issue of material fact precluded

summary judgment on any of the Wiretap Act claims.

The Wiretap Act prohibits intentionally intercepting an

oral conversation, 18 U.S.C. § 2511(a), as well as intentionally disclosing or using the contents of such a conversation while having reason to know that it was unlawfully intercepted, 18 U.S.C. § 2511(c), (d); see Nix v. O’Malley, 160 F.3d 343, 348 (6th Cir. 1998) . Necessary to all of

1
12 No. 08-3420

(...continued) 1

disclosure occurred in or through the means of interstate

commerce. It seems that it would. See Doe v. Smith, 429 F.3d 706,

709 (7th Cir. 2005). If the Lanier dictating system (the system

Lindberg used) transmits data through the internet or telephone lines, for example, or if Freed transmitted the recording

via mail or e-mail to the CEO of the hospital, the Board of

Directors, or anyone else, the interstate commerce requirement will have been met. The defendants have not questioned

the use of the Wiretap Act nor its constitutionality. (Note that

if Freed wishes to challenge the constitutionality of the Act,

she would need to alert the district court and arrange for

notice to be given to the Attorney General so that the federal

government may intervene to defend the legislation if it so

desires. See id.; 28 U.S.C. § 2403(a); Fed. R. Civ. P. 25(c)). As

neither party has raised the issue before us, we need not

resolve it here, but flag it for resolution on remand.

the plaintiffs’ claims, then, is an intentional interception. But the plaintiffs need not produce direct evidence

of the intentional interception; for often the only way

to prove that a stealthy interception occurred is through

circumstantial evidence. See DirectTV v. Webb, 545 F.3d

837, 844 (9th Cir. 2008).

In determining if there was an issue of material fact

on the intentional interception element, the court views

the record in the light most favorable to the non-moving

party, and draws all reasonable inferences in that party’s

favor. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255

(1986); Antonetti v. Abbott Labs., 563 F.3d 587, 591 (7th

Cir. 2009). The court may not weigh the evidence or
No. 08-3420 13

decide which testimony is more credible. Anderson, 477

U.S. at 255; Kodish v. Oakbrook Terrace Fire Protection

Dist., 604 F.3d 490, 507 (7th Cir. 2010); Payne v. Pauley, 337

F.3d 767, 770 (7th Cir. 2003). Even if one side’s story

is more believable, the court must “avoid[ ] the temptation to decide which party’s version of the facts is more

likely true.” Payne, 377 F.3d at 770; Kodish, 604 F.3d at

507. “As we have said many times, summary judgment

cannot be used to resolve swearing contests between

litigants.” Payne, 377 F.3d at 770.

Here, the plaintiffs testified that they did not turn on

the dictation machine that recorded their private conversation, but that during their conversation Freed

walked in and picked up papers adjacent to the machine, giving her easy access to it. That testimony,

when coupled with the facts that the machine was

turned on in actual mid-conversation, and that Freed

disliked Lindberg’s work at the hospital and therefore

had reason to discredit him, provides circumstantial

evidence that Freed deliberately turned on the recording

equipment to capture the unflattering conversation.

Freed does not dispute some elements of this story—she

recalls entering Lindberg’s office while he was speaking

to McCann and picking up a stack of forms immediately

next to Lindberg’s dictation machine. Freed just denies

that it happened on the 24th, and denies that she intentionally turned on the dictation machine while she was

there. But that leaves us with conflicting testimony on a

central issue—in other words, a swearing contest.

Furthermore, the recording does not contradict the

plaintiffs’ version of the story, and, viewed most fav-
14 No. 08-3420

orably to the plaintiffs, provides some support for it. The

district court thought the recording favored Freed’s

story in part because the recording reflects the sound of

a door closing when McCann left, but not when Freed

would have left. But nothing in the record tells us

whether the door could have been closed silently;

McCann said she was in a hurry when she left and may

have let the door slam, whereas Freed, who was conscious that she was intruding (and, perhaps, that she

was being taped) may have closed the door softly to be

inconspicuous. Viewed in the light most favorable to the

plaintiffs, the absence of sound does not prove Freed

correct. In addition, the plaintiffs point out that if

Lindberg had accidentally left the machine on, as the

defendants suggest, it presumably would have caught

their conversation from the beginning. But instead it

picks up in the middle of the conversation, so one

could infer that it was off but then someone turned it on

during the conversation. That is a reasonable inference,

and one we must credit on summary judgment.

When reasonable inferences are drawn in the plaintiffs’ favor, there is an issue of material fact as to

whether Freed intentionally intercepted the plaintiffs’

conversation under 18 U.S.C. § 2511(a)(1). That issue of

fact precludes summary judgment on the § 2511(a)(1)

claim against Freed. It also precludes summary judgment on the § 2511(b) claim against her—that she “disclosed” or “used” the contents of the conversation—

because Freed admitted that she distributed the transcript and recording. As for the claim against the

hospital based on Freed’s conduct, since the hospital
No. 08-3420 15

does not argue on appeal that respondeat superior is

inapplicable, that claim is available on remand as well.

The claims against the remaining defendants are

another matter. Even if Freed illegally made the

recording, Leurck and the trustees could be liable only

if they had reason to know the recording was made

illegally and they used or disclosed the recording.

The district court did not address the defendants’ arguments on those points, but that does not preclude us

from sustaining the judgment based on those arguments.

See Wisconsin Cent., Ltd. v. Shannon, 539 F.3d 751, 761

(7th Cir. 2008).

To be liable under § 2511(c) or § 2511(d), a defendant

must know or have reason to know “’sufficient facts

concerning the circumstances of the interception such

that the defendant[ ] could, with presumed knowledge

of the law, determine that the interception was prohibited in light of [the Wiretap Act].’ ” Nix, 160 F.3d at

349-50 (quoting Thompson v. Dulaney, 970 F.2d 744,

749 (10th Cir. 1992)). It is not enough to know that the

conversation was intercepted; the defendant must also

be able to tell that none of the statutory exceptions

apply. See Williams v. Poulos, 11 F.3d 271, 284 (1st Cir.

1993); Thompson, 970 F.2d at 749. If the defendant does

know the interception was illegal, then he is liable if

he “uses” or “discloses” to others the contents of the

recorded conversation. 18 U.S.C. §§ 2511(c), (d), 2520.

Leurck testified that Freed told him that the recording

was made because Lindberg forgot to turn off his

dictation machine (again), and if that is all Leurck

knew, then he had no reason to think that the recording
16 No. 08-3420

violated the statute, which does not cover inadvertent

interceptions. The plaintiffs argue that Leurck must have

known that the recording was unlawful because Leurck

asked two trustees to return the copy of the transcript

he had given them. But as the defendants point out, that

was after the plaintiffs’ counsel sent the hospital a

letter accusing Leurck of illegally intercepting the conversation. In light of the letter it is unsurprising that

Leurck asked for the transcript back: as a CEO faced

with an allegation of illegality, even one he may have

thought was unfounded, it was prudent for him to

avoid exposing the hospital to further potential liability

by ensuring that the transcripts were not disseminated

to anyone else. Inferring from this conduct that Leurck

must have known the recording was illegal would put

him on a razor’s edge: risking liability in the form of an

inference of guilt if he seeks to contain any damage,

and risking additional liability from the transcript’s

further distribution if he does not. See, e.g., Beck v.

Dobrowski, 559 F.3d 680, 684 (7th Cir. 2008); Armstrong

v. LaSalle Bank Nat’l Ass’n, 446 F.3d 728, 733 (7th

Cir. 2006); Flanagan v. Ashcroft, 316 F.3d 728, 730 (7th

Cir. 2003). That Leurck emailed the trustees this

request makes it even more far-fetched that he was

trying to cover his tracks—a presumably sophisticated

CEO would know better than to “cover up” a purportedly illegal recording by creating an electronic trail

of the cover-up. On summary judgment we make reasonable inferences in the plaintiffs’ favor, but Leurck’s

request for the transcript is too thin a reed on which to

base a reasonable inference that he knew the recording

was illegally obtained.
No. 08-3420 17

The plaintiffs also seem to suggest in their reply

brief that the letter itself gave Leurck a reason to know

that the recording was illegal. But the letter provides

only a bald allegation and no concrete facts, let alone

facts that Leurck was required to believe, to undermine

his belief that the recording was made accidentally. See

Nix, 160 F.3d at 349-50. Indeed, the letter accuses him

of intercepting the conversation, and since he knew that

he did not do so (no one suggests now that he was the

interceptor) it is difficult to see how he could have

gleaned that one of his employees surreptitiously turned

on Lindberg’s dictation machine.

As for the trustees, in their brief the plaintiffs identify

only one, Mohammed Razvi, who they contend had

reason to know the conversation was recorded illegally.

They explain that McCann testified that Razvi said to

her that the recording was illegal. But, as the defendants

point out, it is immaterial if Razvi knew, because the

plaintiffs agreed in their statement of undisputed facts

that Razvi did not use or disclose the transcript of the

conversation. Accordingly, Razvi could not be liable

under § 2511(c) or § 2511(d).

The grant of summary judgment for Leurck and the

trustees is AFFIRMED. The grant of summary judgment

for Freed and the hospital is VACATED, and the case is

REMANDED for further proceedings consistent with

this opinion.

9-13-10