author: ROVNER, District Judge. '

text:
    Lydia HORBACZEWSKY, Plaintiff, v. SPIDER STAGING SALES COMPANY and Eric M. Roemish, Defendants.
    No. 84 C 1109.
    United States District Court, N.D. Illinois, E.D.
    July 17, 1985.
   MEMORANDUM OPINION AND ORDER

ROVNER, District Judge. '

Presently pending before this Court is defendant’s motion to dismiss Counts I and IV of plaintiffs complaint. Plaintiff alleges, inter alia, that she was sexually harassed by her supervisor in violation of Title VII, 42 U.S.C. § 2000e, et seq. The motion to dismiss Count I is based on the plaintiffs failure to plead that the corporate defendant knew of the alleged sexual harassment, which the plaintiff argues is an essential element of a Title VII claim founded on the supervisor’s sexual harassment. This argument has been soundly rejected by the Seventh Circuit in Horn v. Duke Homes, 755 F.2d 599, 604-605 (7th Cir.1985), in which the Seventh Circuit stated that “[e]very circuit that has reached the issue has adopted the EEOC’s rule imposing strict liability on employers for the acts of sexual harassment committed by their supervisory employees____” Accordingly, defendant’s motion to dismiss Count I is denied.

Plaintiff asserts that Count IV, although pled on the theory of breach of an implied covenant of good faith in an employment contract, in fact asserts a cause of action for retaliatory discharge based on the Illinois Supreme Court’s decision in Palmateer v. International Harvester Co., 85 Ill.2d 124, 52 Ill.Dec. 13, 421 N.E.2d 876 (1981). This Court agrees that a common law cause of action for retaliatory discharge might be available to plaintiff as a violation of clearly mandated public policies against sexual discrimination if the plaintiff had no other means of legal redress. Here, however, the plaintiff has alleged violations of both Title VII and of the Illinois Human Rights Act. Both of these statutes provide “comprehensive mechanisms for the enforcement of their substantive provisions.” McCluney v. Joseph Schlitz Brewing Co., 489 F.Supp. 24, 26 (E.D.Wisc.1980). This Court, like the court in McCluney, declines to “imply a private cause of action to uphold a public policy when [Congress] and the state legislature have already provided enforcement mechanisms to vindicate such policies.” Id. Accordingly, defendant’s motion to dismiss Count IV is granted because it is duplicative of plaintiff’s federal and state statutory remedies.

It is so ordered.


source: Caselaw Access Project

author: SENTER, Chief Judge.

license: Public Domain

text:
    H.G. and Florence McCULLOUGH, Plaintiffs, v. The SECRETARY OF The TREASURY and the United States of America, Defendants.
    No. EC 84-408-LS-D.
    United States District Court, N.D. Mississippi, E.D.
    July 18, 1985.

      H.G. and Florence McCullough, pro se.
    Glen H. Davidson, U.S. Atty., Thomas W. Dawson, Asst. U.S. Atty., Oxford, Miss., Gregory L. Nelson, Atty., Tax Div., U.S. Dept. of Justice, Washington, D.C., for defendants.
   MEMORANDUM OPINION GRANTING DEFENDANTS’ MOTION TO DISMISS

SENTER, Chief Judge.

Presently before the court is defendants’ motion to dismiss the complaint for failure to state a claim upon which relief may be granted. In 1981, plaintiffs filed an income tax return for the year ended 1980 on which was computed their tax liability for that year. On August 25, 1983, plaintiffs filed an amended income tax return claiming an error in the taxable income reported on the tax return filed in 1981. The plaintiffs contend that they received no income or gain because their services rendered and the compensation received constituted an equal exchange of value. Plaintiffs also contend that the penalty assessed to plaintiffs for filing a frivolous income tax return is unconstitutional in several respects. Defendants argue that all of plaintiffs’ claims are meritless, and move to dismiss the complaint for failure to state a claim upon which relief may be granted and to be awarded attorneys’ fees and related expenses incurred in responding to this action.

Upon reviewing the pleadings and memoranda of the parties and being otherwise fully advised, the court concludes that all of plaintiffs’ contentions are without merit, and hereby grants defendants’ motion to dismiss. The court also awards to defendants the costs of having to respond to this suit, including attorneys’ fees.

The plaintiffs name the Unitec States and the Secretary of the Treasury as co-defendants in this action. As an officer or employee of the United States, the Secretary is not a proper party in an action for the recovery of any penalty claimed to have been wrongfully collected. 26 U.S.C. § 7422(f)(1) (Supp.1985). Therefore, this action is properly against only the United States. Id.; see Tibbetts v. Secretary of the Treasury, 577 F.Supp. 911, 913 (W.D. N.C.1984); Drefchinski v. Regan, 589 F.Supp. 1516, 1520 (W.D.La.1984).

Plaintiffs challenge on several constitutional grounds the penalty imposed by defendants. First, it is claimed that the penalty violates the separation of powers doctrine by granting to the executive branch — the I.R.S. — the judicial power of assessing penalties, This contention, however, is groundless because the Commissioner’s action is subject to judicial review. Stamp v. C.I.R., 579 F.Supp. 168, 171 (N.D. Ill.1984). Every court that has addressed this issue has rejected it, and this court now joins them. See, e.g., United States v. Eagan, 587 F.2d 338, 339 (6th Cir.1978); Vaughn v. United States, 589 F.Supp. 1528, 1533 (W.D.La.1984); Brennan v. C.I.R., 581 F.Supp. 28, 30 (E.D.Mich.), aff'd, 752 F.2d 187 (6th Cir.1984); Tibbetts v. Secretary of the Treasury, 577 F.Supp. 911, 915 (W.D.N.C.1984).

Also without merit is plaintiffs’ contention that the penalty process violates the due process provisions of the United States Constitution. The situation here is similar to that addressed' by the United States Supreme Court in Bob Jones University v. Simon, 416 U.S. 725, 94 S.Ct. 2038, 40 L.Ed.2d 496 (1974), in which the Court held that a tax may be assessed without a prior hearing as long as the taxpayer can sue for a refund after paying the assessment. This ruling has been specifically applied to assessments of income tax. See, e.g., Googe v. Secretary of the Treasury, 577 F.Supp. 758 (E.D.Tenn.1983); Milazzo v. United States, 578 F.Supp. 248 (S.D.Cal.1984). The proceeding in which these plaintiffs are now engaging is sufficient to protect their guarantees of due process. This action may be appealed, if the parties desire. Accord Drefchinski v. Regan, 589 F.Supp. 1516, 1524 (W.D.La. 1984); Stamp v. C.I.R., 579 F.Supp. 168, 171 (N.D.Ill.1984); Kloes v. United States, 578 F.Supp. 270, 273 (W.D.Wisc.1984).

Plaintiffs also complain that the penalty process violates the agency’s delegated powers. It is clear that the Secretary of the Treasury may assess penalties. See 26 U.S.C.A. § 6701 (Supp.1985). This authority may be delegated to the district directors and the directors of regional service centers of the Internal Revenue Service. 26 C.F.R. 301.6201-1; see also Googe v. Secretary of the Treasury, 577 F.Supp. 758, 760 (E.D.Tenn.1983).

The claim that the penalty assessment violates the First Amendment guarantees of free speech and right to petition the government for a redress of grievances need not detain- us long. The taxpayers here were not penalized for expressing their ideas on tax planning; the penalty was based exclusively on the filing of a frivolous income tax return. See Drefchinski v. Regan, 589 F.Supp. 1516, 1526 (W.D.La.1984); Beard v. United States, 580 F.Supp. 881 (E.D.Mich.1984). Furthermore, the compelling governmental interest of maintaining a revenue system is sufficient to override the fundamental right of freedom of expression. This regulation is narrowly drawn to avoid unnecessary intrusion on freedom of expression. United States v. O’Brien, 391 U.S. 367, 377, 88 S.Ct. 1673, 1679, 20 L.Ed.2d 672 (1968); see Drefchinski v. Regan, supra at 1526-27; Franklet v. United States, 578 F.Supp. 1552, 1556-57 (N.D.Cal.1984); see also United States v. Malinowski, 472 F.2d 850, 857-58 (3rd Cir., cert. denied, 411 U.S. 970, 93 S.Ct. 2164, 36 L.Ed.2d 693 (1973).

Section 6702 does not infringe upon plaintiffs’ right to petition the government for redress of grievances. That the plaintiffs are before this court conclusively shows that their First Amendment rights have been adequately protected. Accord Brennan v. C.I.R., 581 F.Supp. 28, 30 (E.D. Mich.1984); Stamp v. C.I.R., 579 F.Supp. 168, 171 (N.D.Ill.1984); Franklet v. United States, 578 F.Supp. 1552, 1556 (N.D.Cal. 1984); Milazzo v. United States, 578 F.Supp. 248, 253 (S.D.Cal.1984).

The taxpayers here also demand a trial by jury pursuant to the Seventh Amendment. This issue was recently addressed by the Court of Appeals for the Fifth Circuit. Parker v. C.I.R., 724 F.2d 469, 472 (5th Cir.1984), was an action in which a taxpayer intentionally provided insufficient information on his income tax return. As to the jury question, the court quoted from one of its previous decisions, and we now adopt that holding:

The seventh amendment preserves the right to jury trial “in suits at common law.” Since there was no right of action at common law against a sovereign, enforceable by jury trial or otherwise, there is no constitutional right to a jury trial in a suit against the United States. [Citations omitted.] Thus, there is a right to a jury trial in actions against the United States only if a statute so provides. Congress has not so provided when the taxpayer elects not to pay the assessment and sue for a redetermination in the Tax Court. For a taxpayer to obtain a trial by jury, he must pay the tax allegedly owed and sue for a refund in district court. 28 U.S.C. §§ 2402 & 1346(a)(1).

Parker, 724 F.2d at 472 (quoting Mathes v. C.I.R., 576 F.2d 70, 71 (5th Cir.1978)) (emphasis added); accord Davis v. United States, 742 F.2d 171, 173 (5th Cir.1984) (right to jury trial not violated by granting of summary judgment).

The plaintiffs explained on their amended income tax return that their reason for amendment was because their income was “compensation for services rendered. There was an equal exchange of value and no income or gain was derived from the source in either case.” Since there was “no taxable income,” it is argued, then no deductions may be claimed.

A similar claim was raised by the taxpayers in Lonsdale v. C.I.R., 661 F.2d 71 (5th Cir.1981). There the taxpayers argued, inter alia, that the United States Constitution forbids taxation of personal services. Their rationale was that the exchange of services for money is an equal exchange of value, containing no element of profit. Id. at 72 (emphasis in original). The court rejected this argument on the grounds that “income” has been defined as all “accessions to wealth,” see C.I.R. v. Glenshaw Glass Co., 348 U.S. 426, 431, 75 S.Ct. 473, 477, 99 L.Ed. 483 (1955), which is within the Sixteenth Amendment’s power to tax incomes. Because the taxpayers were pro se plaintiffs, the court declined to apply Fed. R.App.P. 38 sanctions, but gave explicit notice that such sanctions would be appropriate in future suits litigating these same, long-settled issues. Lonsdale, 661 F.2d at 72; Lonsdale v. Smelser, 709 F.2d 910, 911 (5th Cir.1983) (assessing double costs and attorneys’ fees against same litigant making same frivolous arguments).

Davis v. United States, 742 F.2d 171 (5th Cir.1984), involved a situation similar to the one in the case sub judice. The taxpayers in Davis had filed an income tax return reporting no income from wages, salaries, or tips, even though the accompanying W-2 forms showed that they had received in excess of $60,000 in wages and other compensation. The taxpayers argued, inter alia, that “an individual receives no taxable gain from the exchange of labor for money because the wages received are offset by an equal amount of ‘costs of labor’.”

The court affirmed its Lonsdale holding that such a claim was totally without merit. Id. at 172. Because of this and other groundless claims, the court enforced Fed. R.App.P. 38 and assessed double costs to the taxpayers, despite the fact that they maintained the status of pro se plaintiffs. Id.; see also Wright v. C.I.R., 752 F.2d 1059, 1063 (5th Cir.1985) (awarding to Commissioner attorneys’ fees, damages, and double costs for frivolous appeal by taxpayer despite pro se status); accord Tilbetts v. Secretary of the Treasury, 577 F.Supp. 911, 915 (W.D.N.C.1984) (awarding to defendant travel expenses plus attorneys' fees of $50 per hour (41 hours)).

A taxpayer in Parker v. C.I.R., 724 F.2d 469 (5th Cir.1984), had filed an income tax return which contained only his name, address, social security number, and signature. The Commissioner determined tax liability and assessed a penalty for negligent or willful refusal to file an appropriate tax return. Because the taxpayer had raised on appeal arguments against the tax system that were long-settled, the court assessed the taxpayer with double costs and warned that the entire spectrum of Rule 38 sanctions would be enforced against future frivolous appeals. Id. at 472.

Furthermore, the taxpayers in the action sub judice have filed the amended return in bad faith. The proper filing of the original tax return indicates that they were well aware of the requirements of the income tax laws. Subsequent filing of the amended return displays a bad faith effort to challenge well-settled income tax laws and decisions. See Parker, 724 F.2d at 471.

The court thus finds that defendants’ motion to dismiss should be granted and that defendants be awarded costs of' this action, including attorneys’ fees. An order in conformity with this opinion shall issue.


author: RAYMOND J. BRODERICK, District Judge.

text:
    Todd TITUS, et al. v. NEWTOWN TOWNSHIP, Chief of Police Martin Duffy, and Officer Stephen Myers.
    Civ. A. No. 84-3692.
    United States District Court, E.D. Pennsylvania.
    July 24, 1985.

      Theodore Q. Thompson, Ambler, Pa., for plaintiffs.
    Michael M. Mustokoff, Duane, Morris & Heckscher, Philadelphia, Pa., for defendants.
   MEMORANDUM

RAYMOND J. BRODERICK, District Judge.

Plaintiff Todd Titus (a minor) has filed, through his parents, this civil rights action pursuant to 42 U.S.C. § 1983 against defendants Newtown Township, Newtown Police Chief Martin Duffy, and Newtown police officer Stephen Myers. Although the complaint also appears to include a claim brought by plaintiff’s parents in their own right for racially-motivated “harassment” by Newtown police officers (evidently in violation of 42 U.S.C. § 1981), the parties previously stipulated to the dismissal of the plaintiffs’ § 1981 claims. The complaint alleges that Todd Titus sustained injuries to the head and groin after being stopped, searched, and handcuffed by defendant Myers, who apparently believed he was arresting the plaintiff’s brother, Robert Titus. The complaint alleges that after another officer informed defendant Myers that Myers had mistakenly detained Todd Titus rather than Robert Titus, the plaintiff was released and no charges were filed. The complaint alleges that the arrest, search, and detention of Todd Titus were unlawful and violated his Fourth Amendment rights.

The allegations against the Township and Chief Duffy are not clearly stated. In Paragraph 2 of the complaint the plaintiffs “challenge the practice of defendants New-town Township and Chief Duffy in failing and/or refusing to discipline Defendant Officer [Myers] for misconduct until criminal charges ... are resolved.” In Paragraph 9 the plaintiffs allege that Chief Duffy was “commanding officer of Defendant Officer Myers, and was responsible for the training and conduct of said defendant.” Presently before the Court is the defendants’ motion to dismiss the complaint against the Township and Chief Duffy. For the reasons that follow the Court has determined that this motion will be granted.

Complaint Against the Township

As noted above, the complaint alleges no facts showing the existence of a policy or a custom attributable to the Township which deprived the plaintiff of any constitutional right. See Monell v. New York City Dept. of Social Services, 436 U.S. 658, 98 S.Ct. 2019, 56 L.Ed.2d 611 (1978). The Township cannot be held liable under § 1983 on the basis of respondeat superior. Id. The only allegation against the Township relevant to the § 1983 claim is the Township’s alleged failure to discipline defendant Myers, following the incident involving the plaintiff, until after the resolution of unspecified “criminal charges”. There is no allegation that this “policy” caused or contributed in any way to the deprivation of the plaintiff’s constitutional rights described in the Complaint. Furthermore, as the Supreme Court has recently pointed out:

Proof of a single incident of unconstitutional activity is not sufficient to establish liability under Monell, unless proof of the incident includes proof that it was caused by an existing unconstitutional policy, which policy can be attributed to a municipal policymaker.

City of Oklahoma City v. Tuttle, — U.S. -, -, 105 S.Ct. 2427, 2436, 85 L.Ed.2d 791, (1985) (emphasis added). The complaint against Newtown Township will be dismissed.

Complaint Against Chief Duffy

The complaint against Chief Duffy consists of a conclusory allegation that he was defendant Myers’ commanding officer and was “responsible” for Myers’ “training and conduct”. It is well-settled that a civil rights complaint must contain sufficient factual specificity to identify the particular conduct of the named defendant which has injured the plaintiff. Ross v. Meagan, 638 F.2d 646, 650 (3d Cir.1980). The allegations in this complaint against Chief Duffy lack the requisite specificity. Furthermore, it is quite clear that liability under § 1983 is personal, and may not be imposed vicariously or upon a theory of respondeat superior. Hampton v. Holmesburg Prison Officials, 546 F.2d 1077 (3d Cir.1976). The plaintiff must allege direct, personal involvement by the defendant in the alleged unconstitutional conduct, or active knowledge and acquiescence on the defendant’s part to such conduct. Bracey v. Grenoble, 494 F.2d 566 (3d Cir.1973); Mitchell v. Henderson, 431 F.Supp. 1295, 1301 (E.D. Pa.1977). No such allegations against Chief Duffy are set forth in this complaint.

Finally, to the extent that individual supervisory officials may be held liable under § 1983 for knowing acquiescence in procedures which result in constitutional violations (e.g., a grossly inadequate training program) a plaintiff must identify incidents of unconstitutional conduct by subordinates and show an “affirmative link” between the incidents of misconduct and the complained-of policy or procedure. See Rizzo v. Goode, 423 U.S. 362, 371, 96 S.Ct. 598, 604, 46 L.Ed.2d 561 (1976); Skevofilax v. Quigley, 586 F.Supp. 532, 544 (D.N.J. 1984). No causal connection between any policy or procedure implemented by Chief Duffy and any constitutional deprivation allegedly suffered by the plaintiff has been set forth in the complaint. Accordingly, the complaint against Chief Duffy will be dismissed.


author: EDGAR, District Judge.

text:
    CHATTANOOGA CORPORATION, Plaintiff, v. Dale H. KLINGLER, Harlan B. Jensen, Thomas H. Church, Richard Wilkins, Lewis C. Duncan, and James W. Sander, Defendants.
    Civ. No. 1-81-145.
    United States District Court, E.D. Tennessee, S.D.
    July 26, 1985.

      John B. Phillips, Jr., John Seymour, Stophel, Caldwell & Heggie, Chattanooga, Tenn., Ronald T. Lindsay, Charles B. Park, III, Bell, Seltzer, Park & Gibson, Charlotte, N.C., for plaintiff.
    Hugh J. Moore, Jr., Geoffrey G. Young, Witt, Gaither & Whitaker, Chattanooga, Tenn., V’Frank Asaro, Asaro & Associates, San Diego, Cal., for defendants.
   MEMORANDUM

EDGAR, District Judge.

This matter presently appears before the Court on defendants’ motion to dismiss, pursuant to Rules 12 and 56 of the Federal Rules of Civil Procedure and pursuant to 28 U.S.C. § 2201. Plaintiff seeks a declaratory judgment that certain patents assigned to it were not infringed by the plaintiffs. Defendants claim that plaintiff has failed to state a cause of action upon which relief may be granted and that the present matter is not appropriate for declaratory judgment. Subject matter jurisdiction is invoked pursuant to 28 U.S.C. § 1331 (federal question), 28 U.S.C. § 1332 (diversity), and 28 U.S.C. § 1338 (civil action relating to patents).

This matter has been before the Court for more than four years. A motion to dismiss was previously filed which was granted by then Judge Frank W. Wilson, but which was reversed and remanded by the Sixth Circuit Court of Appeals on the issue of personal jurisdiction. Defendants now come to the Court seeking a dismissal on the basis of the inappropriateness of the declaratory action because, as defendants characterize the suit, the present action is actually one for breach of contract and not for patent infringement.

Defendant Dale H. Klingler was President of Vari-Temp Manufacturing Company, and the other defendants are former stockholders of that company.' Defendant James W. Sauder obtained two U.S. letters patent and some corresponding form patents covering devices manufactured by Vari-Temp. Mr. Sauder assigned these patents to the corporation. Mr. Sauder also filed and assigned to Vari-Temp applications for two additional U.S. letters patent. In July of 1977, Vari-Temp and Chattanooga Pharmaceutical Company (plaintiff’s prior name) entered into negotiations with each other concerning the latter’s purchase of the assets of Vari-Temp, included among which were the U.S. letters patent. On August 31, 1977, the parties executed a Memorandum of Sale and Bill of Sale and Assignment conveying the assets of VariTemp to Chattanooga Corporation. VariTemp was liquidated prior to sale and the assets were actually conveyed to Chattanooga Corporation by the individual stockholders to whom the assets had been distributed in liquidation. Under the agreement, Chattanooga Corporation was required to make certain royalty payments to defendants and these payments were made for approximately three and one-half years.

On April 20, 1981, Chattanooga Corporation wrote to each of the defendants repudiating the Memorandum of Sale. Plaintiff then immediately filed a declaratory action seeking a declaration that the U.S. letters patent were not infringed by plaintiff and that the Memorandum of Sale was null and void. Defendants filed a motion to dismiss and Judge Frank Wilson entered an order on December 3, 1981 dismissing the case based on the following rationale:

[T]he lack of jurisdiction over five of the defendants, the superiority of California as an appropriate forum, the lack of a strong public policy urging resolution of patent validity in this instance, the appearance of forum shopping, the venue problems, and the preemption of the parties’ arbitration agreement all militate against this Court’s exercise of its power to render a declaratory adjudication. While no one factor is controlling, the Court believes the combination argues in favor of the dismissal of this case.

Chattanooga Corp. v. Klingler, 528 F.Supp. 372, 381, (E.D.Tenn.1981).

The Sixth Circuit, on appeal, reversed and remanded the case, concluding that the District Court did have personal jurisdiction over all defendants. Chattanooga Corporation v. Klingler, 704 F.2d 903 (6th Cir.1983). It is unclear to what extent the Sixth Circuit considered the other grounds which Judge Wilson gave in support of the dismissal. After the remand the defendants moved to dismiss or to transfer the case to the Southern District of California on venue grounds. That motion was denied by Judge H.. Ted Milburn. The defendants counterclaimed alleging that the plaintiff had engaged in fraud; had breached the Memorandum of Sale agreement; and had violated the Clayton and Sherman Acts. The Court, on motion of the plaintiff, bifurcated the trial, ordering that the antitrust issue posed by the defendant’s counterclaim be separated from the patent/ contract part of the case, with the antitrust issue to be tried immediately following the trial of the contract and patent issues.

Defendant’s current motion to dismiss is premised on its assertion that the present action is one grounded in contract and not in patent law and is therefore inappropriate for declaratory action. Defendants contend that the plaintiff, as owner of the patents, cannot obtain a declaratory judgment concerning possible patent infringement since the defendants have raised no claim of infringement nor have they implied any intention to do so, nor are they empowered to do so. Plaintiff responds that the defendants maintained a reversionary interest in the patents and therefore, pursuant to plaintiff’s abridgment of the Memorandum of Sale, plaintiff has exposed itself to a possible infringement action. Plaintiff points to provisions in the Memorandum of Sale which permit defendants to reclaim the patents upon failure of the plaintiffs to abide by the terms of the contract.

The parties in this case characterize the payments to be made under the Memorandum of Sale in different ways. On the one hand, plaintiff claims that defendants are attempting to exact continuing royalty obligations under the original assignment of the patent. On the other hand, defendants characterize their demands as damages for breach of contract under the Memorandum of Sale. In essence, the parties are talking about the same matter since the contract is the embodiment of the assignment of the patents. Thus, this Court must determine whether the determination of the patent issue is of such import at this juncture to justify the parties proceeding on a declaratory action.

Only cases actually arising under the patent laws, not cases which merely may tangentially involve patent questions, are within the jurisdiction of the federal courts under 28 U.S.C. § 1338(a). Milprint, Inc. v. Cunoood, Inc., 562 F.2d 418, 420 (7th Cir.1977). Furthermore, while plaintiff is correct in asserting that there is a strong policy interest in assessing the validity of patents, see Lear, Inc. v. Adkins, 395 U.S. 653, 89 S.Ct. 1902, 23 L.Ed.2d 610 (1969), declaratory actions require an actual controversy which is within the court’s jurisdiction in order for a court to undertake a proceeding. Robin Products Company v. Tomecek, 465 F.2d 1193, 1195 (6th Cir.1972). To constitute an actual controversy, an actual charge of infringement must exist or there must be sufficient conduct or action by the putative defendant in order to justify a declaratory action. Goodrich-Gulf Chemicals, Inc. v. Phillips Petroleum Co., 376 F.2d 1015, 1018 (6th Cir.1967); see also Super Products Corp. v. DP Way Corp., 546 F.2d 748, 753 (7th Cir.1977). The courts’ authority to declare a patent invalid under the Declaratory Judgment Act is grounded on there existing a controversy concerning infringement of the patent. Thiokol Chemical Corp. v. Burlington Industries, Inc., 313 F.Supp. 253, 255 (D.Del.1970), aff'd, 448 F.2d 1328 (3rd Cir.1971), cert. denied, 404 U.S. 1019, 92 S.Ct. 684, 30 L.Ed.2d 668 (1972).

The applicable standard for ascertaining the existence of a controversy under the Declaratory Judgment Act is whether there is a “[w]ell grounded fear that should [the plaintiff] continue or commence the activity in question, he faces an infringement suit or the damaging threat of one to himself and his customers. The touchstone is a reasonable apprehension.” Japan Gas Lighter Association v. Ronson Corp., 257 F.Supp. 219, 237 (D.N.J.1966) (emphasis in original). See also Sweetheart Plastics, Inc. v. Illinois Tool Works, Inc., 439 F.2d 871, 874 (1st Cir.1971); Societe de Conditionnement en Aluminum v. Hunter Engineering Co., 655 F.2d 938 (9th Cir.1981). Even a refusal by a patent holder to grant a request for patent clearance does not give rise to a sufficient controversy. See International Harvester Co. v. Deere & Co., 623 F.2d 1207, 1214 (7th Cir.1980).

Plaintiff contends that the defendants’ demand for damages, characterized as contract damages by the defendant and royalty payments by the plaintiff, indicate that the defendants are seeking to hold the plaintiff liable for infringement of patent. In essence, plaintiff contends there is a federal patent question while defendants argue that the matter is solely one of state contract law. Nonetheless, the Court must look to the defendants’ actions and deeds in order to ascertain whether the controversy is one of patent or contract. International Harvester Co., 623 F.2d at 1211. Milprint, Inc. v. Curwood, Inc. is instructive as to determining the appropriateness of a declaratory action. In Milprint, the controversy was between a licensor and a licensee of a patent. The licensee sought a declaration that the patent which was the subject of the license was invalid and that no further royalty payments were due to the licensor. While the case is somewhat complex in its procedural setting, the court in Milprint declared:

But where the licensor stands on the license agreement and seeks contract remedies, even an allegation of infringement will not create federal jurisdiction for the existence of the license precludes the possibility of infringement. 562 F.2d at 420.

What the court sought to avoid was a party using the Declaratory Judgment Act as an affirmative means of promulgating what should solely be a defense in a state law matter. Id. at 422. The court went on to hold that:

[W]here diversity is lacking, a patent licensee’s declaratory complaint which asserts patent invalidity simply to avoid the obligations of the license does not state a claim arising under the patent laws within the meaning of 28 U.S.C. § 1338(a). Id.

The dispute in this case rages over who owes whom money under a contract to which all parties ascribe their signatures. Nowhere in the pleadings does it appear that the defendant has charged the plaintiff with infringement. Rather, the defendant seeks to collect under a contract to which one possible defense is the invalidity of the patent. It is noteworthy that the District Court determined in this case long ago that it is an “inescapable conclusion” that the cause of action “arose under the contract and not because of infringement per se.” 528 F.Supp. at 381. This determination was not overturned by the Sixth Circuit. 704 F.2d 903 (1983). Because this case is in contract and not in patent, the concerns of Lear, Inc. v. Adkins, supra, do not come into play. Furthermore, since the plaintiff still owns the patent here, the issue of licensee estoppel is not relevant. Finally, the infirmities present here concerning the declaratory action distinguish this case from Lear.

This Court determines that the challenge to the assigned patents is simply an affirmative defense and that there has been no indication that the defendants intend to charge the plaintiff with infringement. Therefore, this Court concludes that 28 U.S.C. § 1331 and 28 U.S.C. § 1338 do not grant this Court subject matter jurisdiction over plaintiffs claim, and further, that plaintiffs claim is inappropriate for relief under the Declaratory Judgment Act. The defendants’ motion to dismiss will be GRANTED.

We are thus left with the defendants’ counterclaim for fraud, for breach of contract, and for antitrust law violations. The Court has independent subject matter jurisdiction of these claims under 28 U.S.C. § 1332 (diversity of citizenship), and under 28 U.S.C. § 1331 and 1337 (federal question/antitrust). The Court also has personal jurisdiction over the parties. This counterclaim will proceed to trial, even though the plaintiffs case has been dismissed. Rule 13(i) Federal Rules of Civil Procedure. The case will proceed to a bifurcated trial before a jury, with the fraud contract claims being tried first, and the antitrust issues being tried second.

An appropriate order will enter.

ENTER.

      . The possibility that defendants may repossess the patents and sue for infringement seems very remote. Plaintiffs emphasis upon this appears to be an attempt to create a patent issue where such does not really exist.


author: TOM S. LEE, District Judge.

text:
    Bennie L. EARVIN, Plaintiff, v. MISSISSIPPI EMPLOYMENT SECURITY COMMISSION; James Dawson, Individually and in his Official Capacity as Metropolitan Manager of the MESC, Meridian Center Office: John Windham, Individually and as Area Supervisor, MESC, Area IV; Mary Lawrence Gervin, Director, Mississippi State Personnel Board, Defendants.
    Civ. A. No. E83-0010(L).
    United States District Court, S:D. Mississippi, E.D.
    July 30, 1985.

      Lynda Carol Robinson, Jackson, Miss., for plaintiff.
    Fred J. Lotterhos, Jackson, Miss., for defendants.
   MEMORANDUM OPINION

TOM S. LEE, District Judge.

This cause came before the court for trial and the court heard testimony from witnesses and reviewed exhibits admitted into evidence. The plaintiff, Bennie Earvin, initiated this action pursuant to 42 U.S.C. §§ 2000e-5(f) and (g), 1981 and 1983, alleging that the defendants, James Dawson, John Windham and the Mississippi Employment Security Commission (MESC), had failed to promote him because of his race, had utilized promotion procedures which had a disparate impact on blacks and had retaliated against him for filing a charge of discrimination with the Equal Employment Opportunity Commission.

In McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973) and Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 101 S.Ct. 1089, 67 L.Ed.2d 207 (1981), the United States Supreme Court set out the burdens of proof to be sustained by each party in a Title VII action. The plaintiff has the burden of establishing a prima facie case which involves

(i) that he belongs to a racial minority; (ii) that he applied and was qualified for a job for which the employer was seeking applicants; (iii) that, despite his qualifications, he was rejected; and (iv) that, after his rejection, the position remained open and the employer continued to seek applicants from persons of complainant’s qualifications.

McDonnell Douglas, 411 U.S. at 802, 93 S.Ct. at 1824. The defendant then has the burden of articulating “some legitimate, non-discriminatory reason” for the allegedly discriminatory action. Id. If the defendant is successful in satisfying the burden of production, the burden shifts to the plaintiff who must then establish that the reasons set out by the defendant are mere pretext. Id. at 804, 93 S.Ct. at 1825. In Jackson v. City of Killeen, 654 F.2d 1181 (5th Cir.1981), the. Fifth Circuit held that when sections 1981 and 1983 are used as companion causes of action to a Title VII claim, as they are here, the Title VII burdens of proof apply.

The defendant MESC is an official agency of the State of Mississippi which coordinates and supervises various state and federal employment services and is an employer within the scope of Title VII of the Civil Rights Act of 1964. Defendants Windham and Dawson were, until their retirement, employees of the MESC serving as Area Supervisor of MESC, Area IV and Metropolitan Manager of MESC, Area IV, respectively, at the time of the alleged discrimination.

The promotion procedure to be followed by the MESC is established by the Mississippi State Personnel Board (MSPB). All employees of the state are allowed and encouraged to take examinations and thereby, upon passing the test, be listed on the state register and eligible for promotion. When a local office has a vacancy, the state director of MESC requests from MSPB a certificate of eligibles, which is a list of the top ten scorers on the examination, relevant to the vacant position. The MSPB verifies the vacancy and forwards the certificate of eligibles to the local office which then recommends one of the persons listed on the certificate to the state MESC Director. The local office may request a supplemental certificate if the position cannot be filled from the original.

Plaintiff challenges five promotions in the Meridian office. In 1980, Bob Barnett and Ben Harper were appointed to the position of Supervising Interviewer and, in 1979, Harold Wright was appointed to the position of Manager II. Plaintiff was an Employment Counsellor III at this time and charges that he had a higher score than either Harper or Barnett. He testified that he was on the certificate of eligibles for the Manager II position with a score only 5 points lower than that of Wright. Harper, Barnett and Wright, however, were not actually promoted to the higher positions; rather, the positions which they previously held were upgraded statewide. The situation was not one in which the office sought a certificate of eligibles in order to fill an actual vacancy. The office apparently obtained the certificates to establish that the men were qualified for the positions by reason of being on the certificates. After the changes, Harper, Barnett and Wright each continued to have their same work responsibilities with only a change in title. Therefore, defendants have effectively set forth a “legitimate, non-discriminatory reason” which was not shown by the plaintiff to be mere pretext.

Plaintiff also argues that he, instead of William D. Newell, should have received a promotion to Manager I in April 1980. Plaintiff testified at trial that he had been performing the duties of that position during the time it was vacant since December 1979. Plaintiff, however, was not eligible for the promotion because his name was not on the certificate of eligibles. The scores on the certificate ranged from that of Newell at 97 to a low score of 90; plaintiff had scored 82. Again, plaintiff has failed to establish that the defendants’ articulated reason is mere pretext. The same is true of the promotion in February 1979 given to Ken Swager. Plaintiff was not on the certificate of elig’bles and was, therefore, not eligible for the promotion. Accordingly, this court is of the opinion that plaintiff has failed to satisfy his burden in regard to his claims regarding defendants’ failure to promote.

Following his initial EEOC charge, plaintiff filed another, stating that he was the subject of retaliation which allegedly included downgrading of his evaluation, decrease of his work responsibilities and rerouting of his phone calls. Windham and Dawson, as well as other employees of the Meridian office, denied that they knew of or participated in any action in retaliation against plaintiff. Plaintiff’s employment file, which was admitted into evidence, contained no indication that plaintiff’s job description was changed in any way soon after the filing of the initial charge. Plaintiff testified that during this time he had temporarily assumed the responsibilities of a vacant management position in his office. This court is of the opinion that any change in plaintiff’s work was the result of filling the vacant position and not retaliation. Accordingly, plaintiff’s •etaliation claim must also fail for reason of failing to satisfy his burden of proof.

Plaintiff also alleges that MESC’s promotion practices have a discriminatory impact on blacks. According to the plaintiff, blacks are channeled into the Employment Counselor positions and persons in these positions are never further promoted to management jobs such as Supervising Interviewer or Manager. Royal Gober, Employment Services Director, testified, however, that approximately one-half of the Supervising Interviewers in the state are black and one-third of the Manager I’s in the state are black. Additionally, employees such as Newell have been promoted from the Employment Counselor position to that of Manager. Since 1980, plaintiff has been considered for promotions to the positions of Employment Superviser I and II; he refused because he was unwilling to move to Jackson to accept the jobs. The plaintiff further argues that blacks are placed in federally funded program positions which, according to the plaintiff, are less secure than employment services positions. Royal Gober testified that all jobs with MESC, both employment services positions and program positions, are dependent on federal funding. The plaintiff, in 1980, was offered a position in the employment services program which he turned down because he saw it as a lateral transfer and not a promotion. Accordingly, the court finds no merit in plaintiffs claims of disparate impact.

It is, therefore, the opinion of this court that judgment should be entered in favor of the defendants on all claims. A separate judgment shall be entered according to the local rules.

      . Reference to the Mississippi State Personnel Board will hereafter refer to that entity as well as its predecessor, the Mississippi Classification Commission. MSPB is not a defendant in this action and, accordingly, the court does not entertain challenges to that agency's promotional practices. The court, therefore, considers only the actions of MESC which are not attributable to compliance with MSPB procedures.

      . Apparently, MESC’s affirmative action program includes encouragement of blacks to take examinations with no special consideration given to minorities in actual hiring decisions.

      . When additional persons have the same score as the tenth person on the certificate, their names are added.

      . MSPB regulations indicate that all persons whose names appear on the certificate should be polled, or contacted concerning their availability. Testimony at trial, however, indicated that this was not the usual course of conduct and, in fact, was useless when the local office had already received a positive response from the person listed on the certificate whom it considered to be the most qualified.

      . At trial, Windham testified that a supplemental certificate was requested for promotion to the position of Employment Counselor III when Helen Fuller, a Meridian office employee, informed him that she should have been on the certificate and was not. The supplemental certificate then was actually a corrected certificate.

      . According to Windham, the position of Supervising Interviewer entails different responsibilities, generally of either an administrative or technical nature, depending on the circumstances in a particular office.

      . Defendants produced no documentation to establish that these positions were actually upgraded statewide; Windham, however, testified that all employees in his area in these positions were upgraded.

      . Plaintiff argues that he was already doing the job and, therefore, should have received the promotion, just like Barnett, Harper and Wright, who were given new appointments for work they were then doing. At trial, Dawson, whose testimony the court credits, stated that, during the time that the managerial position was vacant, plaintiff did perform some of the duties of the position but only subject to the supervision and direction of Dawson. Assuming that plaintiff was doing the job, the two sets of situations are distinguishable in that Newell filled a vacancy whereas Harper, Barnett and Wright benefited from statewide upgrading of their positions.

      . Plaintiff argued that the agency was free to request supplemental certificates containing lower scores so that it could, in effect, hire anyone it chose. It was not established that the agency could in fact request supplemental certificates unless the promotion was rejected by all those listed on the original. See supra note 5.

      . Plaintiff filed a third charge on April 25, 1983 which stated that Kenneth Swager had been promoted to the position of Manager of the Career Development Unit on October 18, 1982, in retaliation against plaintiff for filing his previous charges. Defendants object to consideration of this charge, contending that it is not timely filed. The plaintiff did not present any evidence of this incident other than the charge and did not meet his burden on this issue.

      . Plaintiff was graded as a satisfactory employee. Newell, who contributed to the evaluation, has never rated any employee as outstanding.

      . Plaintiffs allegation that the hiring of Sam Neal, a black, as Manager III in May 1985 was retaliation against plaintiff for filing charges of discrimination is without merit. Plaintiff has set forth no evidence showing that he was qualified for the position or that he was on the certificate of eligibles and defendants certainly are not required to hold the position open until plaintiff becomes qualified.

      . The court reserved ruling on defendants’ objections to admission of testimony regarding past discrimination. The court overrules that objection because such evidence is probative of the disparate impact issue.


author: KEETON, District Judge.

text:
    Carol PALLAZOLA, Administratrix of the Estate of Betty Ann Michaud, Plaintiff, v. Carolyn RUCKER, Michael Schwartz, Eugene Smith, Charles Peters, Guenther Herpfer, June Pickering Nurses Registry, and Lynn Hospital, Defendants.
    Civ. A. No. 80-2605-K.
    United States District Court, D. Massachusetts.
    Aug. 1, 1985.
    As modified Nov. 8, 1985.

      Ann Marie Maguire, Andrew C. Meyer, Jr., Lubin & Meyer, Boston, Mass., for plaintiff.
    Raymond Kenney, Jr., Clement McCarthy, and Daniel Griffin, Boston, Mass., for Eugene Smith, M.D.
    Barbara Buell, Somerville, Mass., for Michael Schwartz.
    Richard L. Fox and John Britt, Carragher, Fox & Lampert, Chelmsford, Mass., for Carolyn Rucker.
    John Kane, Ropes & Gray, Boston, Mass., for June Pickering Nurses Registry.
    Edward McCarthy, McCarthy & Keane, Cambridge, Mass., for Guenther Herpfer, M.D. and Lynn Hosp.
    Craig M. Brown, Melick & Porter, Boston, Mass., for Charles Peters, M.D.

      Wilson D. Rogers, Jr., Dunn & Rogers, P.C., Boston, Mass., for Lynn Hosp.
   OPINION

KEETON, District Judge.

In November 1980, the plaintiff, Carol Pallazola, administratrix of the estate of Betty Ann Michaud, filed this malpractice action on behalf of that estate against Carolyn Rucker and June Pickering Nurses Registry. After repeated deferrals of court action at the joint request of counsel, plaintiff filed an amended complaint in 1983 naming several additional defendants. Since that time some limited discovery has occurred and the parties have engaged in extensive proceedings concerning the role of the state malpractice tribunal and the posting of bonds by the plaintiff. See Pallazola v. Rucker, 602 F.Supp. 459 (D.Mass. 1984). Now, some four and one-half years after the initiation of this action in federal court and after the state statute of limitations for refiling this action in state court, unless tolled, has long ago run (indeed, having done so even before the filing of the amended complaint), some of the defendants challenge the diversity of citizenship on which the jurisdiction of this court is based. This court having previously entered an interlocutory order, on February 20, 1985, dismissing the action as to defendants Peters, Schwartz, and June Pickering Nurses Registry, these defendants have not participated in this challenge to jurisdiction. One defendant (Rucker), had included in her answer a challenge to jurisdiction, but without specifying why she contended that no diversity of jurisdiction existed. The defendants who now participate in this challenge claim that diversity was “manufactured” for the purpose of this action by the appointment of plaintiff Pallazola as administratrix, and that federal jurisdiction is thus barred under 28 U.S.C. § 1359 (1982). Of course, this court cannot act without jurisdiction and must be open to jurisdictional challenge at any and every point during the proceedings. Therefore, despite any hardship that may result from this holding, either to plaintiff or to any of the defendants (either those who have participated in this challenge or those who have not done so), I am constrained, based on the evidence presented to me at the hearing on June 5, 1985, to conclude that diversity was “improperly” created within the meaning of § 1359, and federal jurisdiction does not exist in this case.

I.

Under 28 U.S.C. § 1332(a) (1982), “The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $10,000, exclusive of interest and costs, and is between ... citizens of different states.” Because the plaintiff Pallazola is a citizen of California and the defendants are citizens of Massachusetts and various other states not including California, diversity jurisdiction would appear to exist. The defendants, however, contend that the plaintiff was appointed administratrix for the purpose of creating diversity and that such “manufactured” diversity is barred by 28 U.S.C. § 1359 (1982). That statute prevents a district court from assuming jurisdiction of an action “in which any party, by assignment or otherwise, has been improperly or collusively made or joined to invoke the jurisdiction of such court.” Id.

Early judicial interpretations of § 1359 permitted jurisdiction even where an administrator admittedly had been chosen solely for the purpose of creating jurisdiction. See Corabi v. Auto Racing, Inc., 264 F.2d 784 (3d Cir.1959) (holding that the appointment of an administrator in order to create diversity was not “improper” or “collusive”); Lang v. Elm City Construction Company, 324 F.2d 235 (2d Cir.1963) (following Corabi); Todd County v. Loegering, 297 F.2d 470 (8th Cir.1961) (following Corabi with respect to trustees).

In 1968, however, the Court of Appeals for the Third Circuit overruled its Corabi decision in McSparran v. Weist, 402 F.2d 867 (3d Cir.1968). In McSparran the Court concluded that § 1359 barred jurisdiction where a nominal party, whether a guardian, administrator or executor, “who has no real or substantial interest in the dispute or controversy” is designated “simply for the purpose of creating diversity of citizenship jurisdiction.” 402 F.2d at 873.

Shortly after McSparran was decided, the Supreme Court held that an assignment made for the purpose of creating diversity jurisdiction is improper and collusive. See Kramer v. Caribbean Mills, Inc., 394 U.S. 823, 89 S.Ct. 1487, 23 L.Ed.2d 9 (1969). The Court concluded that such “ ‘manufacture of Federal jurisdiction’ ” falls within the “very core” of the prohibition of § 1359. 394 U.S. at 829-30, 89 S.Ct. at 1490-91. The Court reserved decision on the issue as to whether manufacture of diversity jurisdiction was barred for administrators and guardians as well as for assignees. 394 U.S. at 828 n. 9, 89 S.Ct. at 1490 n. 9. It noted that court-appointed representatives such as administrators differ from assignees in some respects because they hold their position pursuant to a decree of a state court rather than merely to the action of the parties. But the Court declined to decide whether “these distinctions amount to a difference for purposes of § 1359.” Id.

Although the First Circuit has not specifically addressed the question, the various Courts of Appeals have held “with one voice,” C. Wright, Law of Federal Courts § 31, at 168 (4th ed. 1983), that in the context of the appointment of an administrator these distinctions are not sufficient to warrant departure from the Kramer rule. These courts have held that jurisdiction is barred by § 1359 as improper or collusive where an administrator has been chosen for the purpose of creating diversity jurisdiction. See Bass v. Texas Power and Light Company, 432 F.2d 763 (5th Cir.1970), cert. denied, 401 U.S. 975, 91 S.Ct. 1194, 28 L.Ed.2d 324 (1971); O’Brien v. AVCO Corp., 425 F.2d 1030 (2d Cir. 1969); Lester v. McFaddon, 415 F.2d 1101 (4th Cir.1969).

In light of the weight of this authority and the underlying purpose of § 1359, to protect diversity jurisdiction against misuse by parties where there is no danger of discrimination against an out-of-state party in state court, I conclude that the McSparran interpretation is the proper one to be applied in this case. The question therefore is whether plaintiff Pallazola was appointed for the purpose of creating diversity jurisdiction in the malpractice action. This question is factual, McSparran, 402 F.2d at 876.

Plaintiff, as the party invoking federal diversity jurisdiction, has the burden of proving diversity of citizenship. Thomson v. Gaskill, 315 U.S. 442, 446, 62 S.Ct. 673, 675, 86 L.Ed. 951 (1942); Hawes v. Club Ecuestre El Comandante, 598 F.2d 698, 702 (1st Cir.1979); McSparran, 402 F.2d at 875-6. Because statutes conferring federal jurisdiction are to be strictly construed, the plaintiff retains the burden at all times to support the allegations of jurisdictional facts. That the jurisdictional challenge is based on defendants’ allegation that the plaintiff “manufactured” diversity does not shift that burden from the plaintiff. Whether or not this usual rule applies in the present case, however, I conclude that there is no federal jurisdiction, because my findings, stated below, are made on a preponderance of the evidence and not on the basis that the burden of proof is decisive.

The decedent Betty Ann Michaud died on December 31, 1977, following surgery and while under the medical care of defendants. She was survived by her mother, her sister Dorothy Waselchuk, and her son and sole heir, Donald Michaud. Ms. Michaud had been a resident of Massachusetts as were her mother, sister, and son at the time this action was filed. Plaintiff Carol Pallazola, a citizen of California at the time this action was filed, was appointed administratrix on October 28, 1980, and the malpractice action was filed in this court in November 1980.

Dorothy Waselchuk, the sister of the decedent, has in many respects been the principal actor in handling the malpractice action and other aspects of the estate of her sister thus far. She headed the household and handled the finances of her sister, her sister’s son and their mother before the death of Betty Ann Michaud, and she has continued to do so since that time. Ms. Waselchuk, an airline stewardess, supported and continues to support the family, paying the rent, health insurance, and other household expenses. With respect to the estate of the decedent, Ms. Waselchuk discovered and paid all debts, including the costs of the funeral, disposed of what assets there were and made the claim on a small life insurance policy held by Ms. Michaud. Having decided to pursue the possibility of a malpractice action, Ms. Waselchuk approached the law firm, Lubin and Meyer, that is now representing the plaintiff in this action. Ms. Waselchuk engaged that firm to handle the malpractice claim in 1980. Later that same year she asked plaintiff Pallazola to become the administratrix. Since the filing of this action in November 1980, Ms. Waselchuk has been in continuous contact with Lubin and Meyer and has assisted in answering interrogatories.

There is evidence that, during the three years between her sister’s death and the appointment of Ms. Pallazola, Ms. Waselchuk suffered physical and emotional trauma from a variety of causes. She suffered from continuing back pain that prevented her from working for a number of months. Her mother experienced serious heart trouble; her father died during this period and, of course, she had lost her sister. The distress that these events caused Ms. Waselchuk is more than understandable. Nonetheless, her performance of every task required to handle the estate of Betty Ann Michaud before the appointment of the plaintiff in 1980, including the engagement of counsel for the present action, renders unpersuasive her claim that she chose the plaintiff because she felt incapable herself of serving as administratrix for purposes of this action (a role that Ms. Pallazola has demonstrated is rather nominal).

Donald Michaud was seventeen years of age at the time of his mother’s death, and twenty in 1980 when the administratrix was appointed. He suffered considerable emotional distress after his mother’s death. I need not decide whether, as plaintiff claims, his distress was of such magnitude as to incapacitate him from acting as administrator. There is ample evidence in the record to convince me that whether or not Donald Michaud was a viable candidate for the position, Ms. Pallazola was chosen for her out-of-state citizenship.

Carol Pallazola was a long-time friend of Ms. Waselchuk and a sister stewardess. She had never met the decedent and has met the decedent’s sole heir, Donald Michaud, only once or twice. She has never discussed this action or his mother’s estate with Mr. Michaud. In ascertaining whether there were any debts or assets of the estate, Ms. Pallazola relied solely on the verbal assurances of Ms. Waselchuk. When Ms. Pallazola agreed to become the administratrix she understood that her only act as administratrix would be to administer the malpractice action. Her involvement in this litigation has consisted primarily of periodic phone consultations with the office of Lubin and Meyer. She took no part in engaging the firm; she never visited its office nor met any of its lawyers until the day of the evidentiary hearing on jurisdiction. She has kept no written records pertaining to the estate or to this litigation, and she has no authority to settle the malpractice claim without the consent of the beneficiary Donald Michaud.

In light of these facts I find that the choice of Carol Pallazola as administratrix was made for the purpose of creating diversity. Thus, under 28 U.S.C. § 1359, federal jurisdiction is barred.

Plaintiff urges that I give only prospective effect to my ruling that diversity jurisdiction is barred by § 1359 where the administrator is appointed for the purpose of creating jurisdiction. In support of her position plaintiff points to Lester v. McFaddon, 415 F.2d at 1106-8, in which prospective effect was given to an identical holding. That case is inapposite, however, because it was decided immediately after the McSparran decision overruling Corabi. The Court considered the inequity of applying the McSparran rule to parties who had commenced their action before that holding and had relied on the long-established Corabi interpretation. Here no such inequity is present. The McSparran rule and the various opinions of the Courts of Appeals approving McSparran and extending the Kramer rule of the Supreme Court to administrators have been reported for well over a decade. The holding as to § 1359 should thus come as no surprise to the plaintiff, and I conclude that a prospective ruling is not warranted.

II.

There has been some suggestion by the plaintiff that, should I find no diversity on the basis of her citizenship, I should look to the citizenship of the sole beneficiary Donald Michaud, that I should find him to have been a citizen of New York, and that I should therefore conclude that there is diversity. Some courts, having discounted the “manufactured” diverse citizenship of the nominal plaintiff, have indeed attributed the citizenship of the beneficiary to the plaintiff for the purpose of that action, see, e.g., Vaughan v. Southern Ry. Co., 542 F.2d 641, 643-4 (4th Cir.1976), though ordinarily for the purpose of defeating rather than finding diversity. I need not decide whether similar attribution would be appropriate in a case such as this in order to create diversity because it is clear from the evidence adduced at the hearing that Donald Michaud was a citizen of Massachusetts and not of New York in November 1980, the time of the filing of this action. Although it is undisputed that Mr. Michaud was a student at a college in New York during the academic year 1980-1981, it is also undisputed that he lived in a school dormitory, returned home to Massachusetts for school vacations, registered his car in Massachusetts, and registered to vote in Massachusetts. Although the citizenship of college students is often problematic, I find, based on the above evidence, that Donald Michaud was a citizen of Massachusetts at the time this action was filed. Thus, even were I to conclude that Mr. Michaud’s citizenship was relevant to the jurisdictional question, I would have to conclude there was no diversity jurisdiction.

III.

Having concluded that there is no federal subject matter jurisdiction, I turn now to the disposition of this case. This action was filed over four and one-half years ago in this federal district court. The jurisdictional issue was not raised by any defendant before defendant Rucker’s answer in 1983, and not specifically on the grounds of “manufactured” diversity until May 1985, well after the statute of limitations on any potential action in state court had run, if not tolled. I am thus faced with the distressing and inequitable possibility that, should I dismiss this case, it may never be heard on its merits in any court, unless the state court accepts it or on other grounds holds that an action newly filed in state court is not barred by the statute of limitations. Because of the potentially drastic results of federal dismissal, several alternative possibilities for disposition have been raised.

First, the suggestion that I “remand” the case to the state court pursuant to 28 U.S.C. § 1447(c) (1982) must fail. Such remand is authorized only where the action was originally filed in state court and then “improvidently” removed to federal court. Here, this action was not filed in state court; it originated in federal court.

Second, 28 U.S.C. § 1631 (1982) likewise provides no alternative disposition. According to that section, a district court finding itself without jurisdiction may transfer a case. The section applies, however, only to transfers within the federal court system and not to a transfer from federal to state court. McLaughlin v. ARCO Polymers, Inc., 721 F.2d 426 (3d Cir.1983); see 28 U.S.C. § 610 (1982) (defining “court” to which an action may be transferred pursuant to § 1631 as a court of appeals or district court of the United States or one of the various other federal courts such as the United States Claims Court).

The final suggestion, advanced by plaintiff, that I refer this case to state court, warrants more serious consideration. A court always has jurisdiction to determine whether it has jurisdiction over a case. Inherent in the former jurisdiction is the power to order an appropriate disposition of the ease after the latter jurisdiction is found wanting. Disposition may be to dismiss or, in an appropriate case, to transfer the case — for example, pursuant to a federal statute such as § 1631. I conclude that referral to a state court willing to accept the case as a matter of state law is another available alternative. Cf. Weaver v. Marine Bank, 683 F.2d 744 (3d Cir.1982) (ordering a district court, as to a case based on a state law claim, originally brought pendant to a federal claim, to transfer the case to a state court pursuant to a state statute that specifically approved such a transfer).

In Massachusetts there is no statute, to my knowledge, that expressly provides for acceptance by the state court of cases from a federal court. There is, however, a “saving statute” that provides for the refiling of actions dismissed for various reasons after the statute of limitations has run. Mass.Gen.Laws Ann. ch. 260, § 32 (West 1984). Whether a state court can and will accept this case — relying on the saving statute, or on the powers inherent in its general jurisdiction, or on some other basis in state law — is a question of state law. I conclude that it is inappropriate for a federal court, in the circumstances of this case, even to purport to decide that question. It is appropriate, however, and indeed necessary, that I take account of the various ways that issue might be decided and avoid entering a form of order that might in any way be thought to restrain or limit the freedom of the state court to accept the case, if it should choose to do so. State law may, for example, authorize the state court to take account of the fact that the case has actually been before it already on referral by this court for state malpractice tribunal proceedings. Rather than addressing such an issue of state law, I ruled on August 1, 1985, that as a matter of comity I should postpone the entry of a final disposition in this case for a reasonable period of time to allow the plaintiff an opportunity to obtain a ruling from a state court as to its willingness to accept the case either by transfer of the case now pending in this court or by the filing of a new complaint.

Because of the late stage at which the jurisdictional challenge was raised in this case, it may be argued that the difference between referral to the state court and dismissal would be significant. First, if the case is dismissed, the plaintiff may be barred from filing a new action in state court because the statute of limitations has run. Second, even if a new case were to be allowed under the saving statute or some other provision, years of litigation effort, including the extensive proceedings before the state malpractice tribunal, might be lost. Thus, it is particularly important that the state be given an opportunity to decide whether, as a matter of state law, it can and will accept the ease from this court.

The defendants contend that this court may take no action other than dismissal because of lack of inherent power to transfer. The First Circuit has indeed held that where there is a lack of subject matter jurisdiction there is no inherent power to transfer. See Dantes v. Western Foundation Corporation Association, 614 F.2d 299, 301 (1st Cir.1980). That holding is not controlling as to the issue at hand, however. An inherent power to transfer, as examined in the context of that case, implied authority not only to remove the case from the court’s own docket, but also to place it on another court’s docket — thus requiring the other court to take judicial action to dispose of the case, even if not on the merits. It was a claim of that power that the First Circuit rejected. Here the proposal is not that this court order the state court to accept transfer of the case, but only that this court offer to refer the case if a state court is willing to accept it. I conclude that if, as a matter of state law, a state court is willing to accept a case, a federal court may refer it in the exercise of the federal court’s authority to make an appropriate disposition of a case after a want of jurisdiction has been noted.

A second objection to such a disposition is suggested by the dissent in Weaver, see 683 F.2d at 751-2 (Sloviter, J., dissenting), which reasoned that federal referral pursuant to state law was constitutionally prohibited. It characterized such referral as relying on an unconstitutional state creation of federal court authority. Even if the First Circuit were to adopt this argument, however, I conclude that it would apply only to purported state assertions that a federal court must act. The dissenting opinion in Weaver did not address the constitutionally significant distinction between a purported state mandate of federal court action and a state declaration of receptivity to action initiated by the federal court. Here, even if the state would be willing to accept the case, it in no way would be forcing this court to refer it. The state court would not be requiring this court to take any action, nor could it do so consistently with the mandate of Article III that only Congress can grant authority to the federal courts. The state court would merely be expressing its receptiveness to taking the case should the federal court choose, on the basis of its own power to dispose of cases over which it has no jurisdiction, to refer it.

The functioning of the medical malpractice tribunal system, both in this case and in malpractice cases more generally, has illustrated both the propriety and the utility of acts of comity between state and federal courts. Under that system neither court purports to order actions by the other but each invites and gives effect to the other’s actions pursuant to the state malpractice tribunal statute, to state decisions construing it, and to federal law, both statutory and decisional, bearing upon diversity cases. See generally Feinstein v. Massachusetts Gen. Hosp., 643 F.2d 880 (1st Cir.1981) (holding that the Erie doctrine requires federal district court sitting in a diversity action to refer malpractice cases arising under the Massachusetts statute to the malpractice tribunal, the state having manifested its willingness to accept such referrals); Clarke v. Heisey, 16 Mass.App. 976, 452 N.E.2d 1174 (1983) (holding that determination of applicability of malpractice tribunal statute to case pending before federal court was to be made by the federal court, not the state court).

IV.

On October 8, 1985, the Superior Court Department of the Trial Court of the Commonwealth of Massachusetts entered an Order allowing plaintiff’s motion for acceptance of the case. After considering further submissions of the parties, oral and written, received after entry of the Order of October 8, 1985, I conclude that judgment shall be entered in the form attached as an appendix to this Opinion.

APPENDIX

Judgment

November 8, 1985

For the reasons stated in the Opinion of August 1, 1985, as modified this date, it is ORDERED:

The Clerk shall forthwith forward a certified copy of the docket entries and all pleadings in this action to the Clerk of the Essex Division of the Superior Court Department of the Trial Court of the Commonwealth of Massachusetts for acceptance pursuant to the Order of that court of October 8, 1985.

Such certified copy having been forwarded and accepted, this action is dismissed for want of subject matter jurisdiction of this court to take further action in this case.


author: ROYNER, District Judge.

text:
    STANLEY GUDYKA SALES CO., INC., Plaintiff, v. LACY FOREST PRODUCTS COMPANY, an Oregon Partnership, et al., Defendants.
    No. 84 C 5165.
    United States District Court, N.D. Illinois, E.D.
    Aug. 9, 1985.
   MEMORANDUM OPINION AND ORDER

ROYNER, District Judge.

Presently pending before this Court is the defendant’s motion for summary judgment. The plaintiff, Stanley Gudyka Sales Co., Inc. (“Gudyka”) and the defendant, Lacy Forest Products Company (“Lacy”) entered into an employment agreement whereby Lacy hired Gudyka as a sales representative in July, 1981. The agreement provided that Gudyka could be terminated only “for just cause.” It also provided that Gudyka would be paid a commission of 50% of the net margin realized by Lacy on any sales generated by Gudyka.

The dispute centers over commissions from a particular account. In December, 1982, a change was made in this account regarding the method of payment. Instead of paying a commission to Lacy directly, the supplier decided to send commission checks directly to Gudyka, 50% of which Gudyka was then to remit to Lacy. Thirteen checks totalling $5,839.42 were sent to Gudyka from December 13, 1982 to May 7, 1983. Lacy received no information from Gudyka or from the supplier regarding the amounts of commission Gudyka received on the account despite Lacy’s repeated phone requests to Gudyka for the amounts and despite Gudyka’s prior agreement to provide such information. In early June, 1983, after learning that Gudyka had been paid commissions in excess of $5,800, Lacy decided to terminate Gudyka because he had not accounted for 50% of this amount and because Lacy felt that he could no longer be trusted.

Lacy argues that it is entitled to summary judgment dismissing the complaint first because Gudyka was terminated for just cause as a matter of law, and second because, under Illinois law he was an employee at will terminable for any cause or for no cause at all.

Forjjhe latter proposition, Lacy cites several cases which are distinguishable from this case. In those cases continued employment was conditioned on “satisfactory performance.” Here, the employee may not be discharged except “for good cause.” See, e.g., Buian v. J.L. Jacobs and Company, 428 F.2d 531 (7th Cir.1970); Gordon v. Matthew Bender & Co., Inc., 562 F.Supp. 1286 (N.D.Ill.1983); Payne v. AHFI/Netherlands, B. V., 522 F.Supp. 18 (N.D.Ill. 1980). As the court stated in Scaramuzzo v. Glenmore Distilleries Co., 501 F.Supp. 727, 732 (N.D.Ill.1980) “[a] contract that fails to specify the length of the term of employment, but that does set conditions upon which termination may be based, is not terminable at will — it is terminated upon the existence of those conditions.”

This Court also must reject Lacy’s argument that it can determine as a matter of law that Lacy terminated Gudyka for good cause. Although it is certainly correct, as Lacy points out, that in a proper case a court may apply the undisputed facts to the standard for termination and determine whether the standard has been met as a matter of law, this is not such a case. Here, Gudyka asserts that all requests of him by Lacy for the amounts of commission owing from the particular account were made in passing in telephone conversations that centered around other subjects; that he always assumed, and was never told otherwise, that Lacy was receiving paperwork from the supplier which indicated the commission amounts being paid directly to Gudyka; that Lacy knew that Gudyka was being paid commission amounts directly because Gudyka was always truthful; that Lacy never expressed any urgency about the matter and let it drag on for six months, thereby condoning his lackadaisical attitude toward the matter; and, most importantly, that this attitude was justified because Lacy itself at all times owed Gudyka more than Gudyka owed Lacy for commissions on other accounts and had not paid him. If this Court were to accept Gudyka’s account, as it must on a motion for summary judgment, it would be constrained to hold that Gudyka was not terminated for good cause and thus grant him judgment as a matter of law. As this case is presently postured, the existence of obvious issues of material fact and of various inferences to be drawn from the undisputed facts precludes the entry of summary judgment.

For the reasons stated above, Lacy’s motion for summary judgment is denied.


author: STAGG, Chief Judge.

text:
    Isie D. WYSINGER v. UNITED STATES of America.
    Civ. A. No. 84-1103.
    United States District Court, W.D. Louisiana, Shreveport Division.
    Aug. 14, 1985.
    Edward Chevallier, Burkett & Chevallier, Many, La., for plaintiff.
    Joseph S. Cage, U.S. Atty., and John R. Halliburton, Asst. U.S. Atty., Dept of Justice, Shreveport, La., for defendant.
   MEMORANDUM RULING

STAGG, Chief Judge.

This case involves the death of Lewis Wysinger on May 29, 1983 in a drowning accident at Red Hill Lake, a recreational area within the Sabine National Forest which is maintained by the Forest Service (an agency of the United States Department of Agriculture). Plaintiff, mother of the deceased, sued the United States of America under the Federal Tort Claims Act (FTCA) alleging negligence in the failure to provide adequate supervision and safeguards at a swimming facility open to the public.

The United States has filed a motion to dismiss or in the alternative for summary judgment. The United States urges that this court lacks subject matter jurisdiction, that the complaint fails to state a claim upon which relief can be granted, and that the government is entitled to summary judgment under the Texas Recreational Use Statute. Because this court concludes that it lacks subject matter jurisdiction over plaintiff’s claim, defendant’s alternative requests for dismissal under Rule 12(b)(6) and for summary judgment under Rule 56 are MOOT.

28 U.S.C. § 1346(b) grants the United States District Courts:

[EJxclusive jurisdiction of civil actions on claims against the United States, for money damages, ... for injury or loss of property, or personal injury or death caused by the negligent or wrongful act or admission of any employee of the Government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

This jurisdictional grant is limited, however, by “provisions of Chapter 171 of this title.” Id. The exception to jurisdiction involved in this case is 28 U.S.C. § 2680(a):

The provisions of this chapter and § 1346(b) of this title shall not apply to—
(a) Any claim based upon an act or omission of an employee of the Government, ... based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.

To the extent that any alleged act of negligence asserted under the FTCA falls within the exception delineated by § 2680(a), this court lacks subject matter jurisdiction and the claim must be dismissed. Dalehite v. United States, 346 U.S. 15, 73 S.Ct. 956, 97 L.Ed. 1427 (1953); Flammia v. United States, 739 F.2d 202 (5th Cir.1984).

The defendant correctly points to Dalehite, supra and United States v. S.A. Empresa de Viacao Aerea Rio Grandense (Varig Airlines), 467 U.S. 797, 104 S.Ct. 2755, 81 L.Ed.2d 660 (1984), as controlling jurisprudence for determining the discretionary or non-discretionary nature of a government agency or employee’s conduct. The Dalehite court declined to establish a formal definition of “discretionary function,” but held:

[T]he ‘discretionary function or duty’ that cannot form a basis for suit under the Tort Claims Act includes more than the initiation of programs and activities. It also includes determinations made by executives or administrators in establishing plans, specifications or schedules of operations. Where there is room for policy judgment and decision there is discretion. It necessarily follows that acts of subordinates in carrying out the operations of government in accordance with official directions cannot be actionable.

73 S.Ct. at 968.

The Supreme Court has recently reaffirmed the Dalehite standard in Varig Airlines. Varig Airlines also clarified Dalehite by listing factors to consider in assessing whether conduct is discretionary:

First, it is the nature of the conduct, rather than the status of the actor, that governs whether the discretionary function exception applies in a given case____ Thus the basic inquiry concerning the application of the discretionary function exception is whether the challenged acts of a Government employee — whatever his or her rank — are of the nature and quality that Congress intended to shield from tort liability. Second, whatever else the discretionary function exception may include, it plainly was intended to encompass the discretionary acts of the Government acting in its role as a regulator of the conduct of private individuals.

104 S.Ct. at 2765.

Applying the Varig Airlines and Dalehite standards, the defendant urges that the discretionary function exception to this court’s jurisdiction be applied in the case at bar. The plaintiff opposes this motion to dismiss on the grounds that when the government voluntarily assumes a duty it must be carried out in a non-negligent manner and that the decision not to have lifeguards at Red Hill Lake is an actionable tort because it was an operational decision made by the Forest Service concerning a revenue generating program.

The United States Department of Agriculture is granted by Congress the general authority to regulate the national forests. 16 U.S.C. §§ 472, 475, 528-531. The Forest Service Manual sets forth regulations regarding the designation, design, administration, and operation of swimming sites in the national forests. The Forest Service Manual lists guidelines to be followed by forest supervisors in determining the need for lifeguards at a particular swim site. Forest Service Manual § 2335.21. Applying these factors, the forest ranger in charge of the Sabine National Forest made the decision not to provide lifeguards at Red Hill Lake in fiscal year 1983. The plaintiff concedes that the failure to provide a lifeguard at Red Hill Lake in 1983 was the result of a decision made by the district ranger.

This decision not to employ lifeguards is the gravamen of plaintiff’s allegation of negligence on the part of the United States. Because the plaintiff’s complaint is based on the allegation of negligence in a policy choice not to provide lifeguards, it must be dismissed under the Dalehite and Varig Airlines analysis.

The Dalehite court, after an analysis of the legislative history of the FTCA, concluded that Congress had in mind a waiver of sovereign immunity only for ordinary torts (the classic example being an automobile accident). 73 S.Ct. at 964. On the other hand, Congress intended no waiver of sovereign immunity where no negligence was shown on the part of an individual government employee. Id. The purpose of this exception to the waiver of sovereign immunity was to prevent citizens from challenging the validity of discretionary acts through tort suits. Id. at 965. The federal employee is accorded complete discretion “to act according to [his] judgment of the best course.” Id. at 967.

The Varig Airlines decision made it clear that federal courts lack subject matter jurisdiction to review the decision of government agencies and employees in a suit for damages under FTCA:

Judicial intervention in such decisionmaking through private tort suits would require the courts to ‘second-guess’ the political, social, and economic judgments of an agency exercising its regulatory function. It was precisely this sort of judicial intervention in policy making that the discretionary function exception was designed to prevent.

104 S.Ct. at 2768.

That the decision made created risk of injury to individuals is immaterial. The Varig Airlines court found that where the government undertakes “certain calculated risks, ... encountered for the advancement of a governmental purpose and pursuant to the specific grant of authority in the regulations and operating manuals,” the decision to take such risks “falls squarely within the discretionary function exception of § 2680(a).” Id. at 2768-69. In light of the Varig Airlines case, the United States Court of Appeals for the Fifth Circuit recently reevaluated its approach to the discretionary function exception of § 2680, and specifically rejected the distinction between high level decisionmaking and specific operational decisions which the plaintiff urges this court to adopt. Flammia, 739 F.2d at 204. The Flammia court held “that the exemption of the Federal Tort Claims Act derived from this discretion extends to specific and individual applications as well as to broad policies.” Id.) See also Spencer v. New Orleans Levee Board, 737 F.2d 435 (5th Cir.1984).

The district ranger of the U.S. Forest Service made the decision not to employ lifeguards at Red Hill Lake. This court has no jurisdiction to second-guess the propriety of that decision. Plaintiff urges that the fact that the United States charges a fee at Red Hill Lake removes it from the § 2680 exception for discretionary function. Plaintiff cites no authority to support this proposition and this court has found none.

The United States has not waived its sovereign immunity in such a manner as to allow federal courts the opportunity (or the jurisdiction) to review the discretionary decisions of federal agencies or employees. For this reason, defendant’s motion to dismiss for want of subject matter jurisdiction must be GRANTED.

An Order consistent with the terms of this Ruling shall issue herewith.


author: JOHN GARRETT PENN, District Judge.

text:
    AMERICAN FEDERATION OF GOVERNMENT EMPLOYEES, AFL-CIO et. al., Plaintiffs, v. Constance J. HORNER, Office of Personnel Management, Defendants.
    Civ. A. No. 81-2210.
    United States District Court, District of Columbia.
    Aug. 15, 1985.
    Joseph Henderson, Washington, D.C., for plaintiffs.
    Robert Seldon, Asst. U.S. Atty., Washington, D.C., for defendants.
   MEMORANDUM

JOHN GARRETT PENN, District Judge.

The plaintiffs, the American Federation of Government Employees (AFGE) and a number of individuals employed by the defendant United States Air Force, filed this action seeking declaratory, injunctive and monetary relief. They challenge the defendants’ decision to classify their present jobs as Air Force Planners and Estimators under the General Schedule (GS) pay scales

as Engineering Technicians rather than under the Wage System Production Facilitation Pay Plan (WD/WN). Specifically, the plaintiffs challenge a September 18, 1978, decision by the Civil Service Commission (CSC), now the Office of Personnel Management (OPM), concerning the proper classification of certain engineering technician positions in the Department of the Air Force (Air Force) under the Classification Act (Act), 5 U.S.C. § 5101 et. seq. The case is now before the Court on cross-motions for summary judgment.

I

AFGE is a labor organization representing more than 750,000 federal employees worldwide. The individual plaintiffs are Air Force civilian employees holding engineering technician, GS-802, positions at the GS-7 grade level. All of the individual plaintiffs work as planners within Base Civil Engineering Squadrons located at various Air Force bases. Plaintiffs claim to represent a class composed of all individuals employed by the Air Force as GS-802, engineering technicians at the GS-7 grade level.

At the time this action was brought, the Air Force employed approximately 1,095 individuals in the engineering technician series, GS-802, in grade levels GS-7 through GS-9. They perform a variety of functions in a variety of organizational units and approximately 338 of those individuals are at the GS-7 grade level. Approximately 780 of the Air Force engineering technicians work in base civil engineering squadrons. 480 of these individuals perform in a function described by the Air Force as the “planner” function. Approximately 177 of these civil engineering planners, including all of the individual plaintiffs, are at the GS-7 level. The Air Force has developed a series of standardized position descriptions for the Engineering Technicians located in its Civil Engineering Squadrons and prescribed that its local activities follow the applicable position descriptions in assigning duties, responsibilities and qualifications for such positions. Duties, responsibilities and qualifications for the remaining Air Force Engineering Technicians are established at the local level.

The Department of the Navy (Navy) employs approximately 6,800 individuals under a prevailing rate wage system known as the Production Facilitating Pay Plan. These individuals work in various positions at approximately 130 Navy installations throughout the world. Approximately, 4300 of these individuals work at the WD-8 grade level, of whom a large but unspecified portion work in positions entitled “Planner and Estimator”. In addition, Navy has a small number of General Schedule positions which perform planning and estimating work. Duties, responsibilities and qualifications for employment for all the positions in the Navy are determined at the local activity level.

The Department of the Army (Army) has approximately 870 positions doing work in the nature of planning and estimating at approximately 75 Army installations. Of these, approximately 685 perform work in the facilities engineering area. Approximately 630 of these positions are currently classified under the Production Facilitating Pay Plan and the remaining 55 are classified under the General Schedule. Duties, responsibilities and qualifications for employment for all positions in the Army are determined at the local level.

On September 18, 1978, OPM’s Classification Appeals Office issued a classification decision concerning certain planner positions located in Air Force Base Civil Engineering Squadrons. The decision found that trade or craft experience was not the paramount requirement for such positions and that such positions were properly classified under the General Schedule in the Engineering Technician Series GS-802. In rendering its September 18, 1978 decision, OPM did not conduct a position-to-position comparison between the positions being considered and the allegedly similar positions in the Navy or Army.

By letter dated December 10, 1980, OPM requested the Department of Defense to review its planner positions and insure that they are classified consistently with OPM classification policies and principles, including the September 18, 1978 decision. In response to that letter, the Department of Defense instituted a study of its Production Facilitating positions to determine their proper classification.

II

The statutory basis for classification of positions in the General Schedule is stated in the Act. Section 5106 provides for placement of each position in its appropriate class and grade, and Section 5104 states the general standards for classification of positions from Grade GS-1 to Grade GS-18. Section 5105 directs OPM to prepare standards for placing positions in their proper classes and grades. Sections 5112 and 5346 provide the basis for appeal to OPM in classification matters. They authorize OPM to ascertain the facts as to the duties, responsibilities and qualification requirements of a position; decide whether a position is in the appropriate class, or occupation and grade; and change a position from one class, occupation or grade to another class, occupation or grade when the facts warrant. OPM’s decision concerning these classification issues are binding on other federal agencies. Section 5112 further provides that an affected employee or agency may request OPM to exercise its appellate authority concerning these issues. Finally, Section 5115 authorizes OPM to prescribe the regulations implementing these statutory provisions.

The plaintiffs contend that their positions are similar to related positions in the Army and the Navy and that the decision of OPM was in error. “[I]n reviewing a [OPM] determination that the employee’s duties are in fact identical or similar in all significant respects to the duties of others at the sought position, the district courts are engaged in a limited judicial review, and their decisions are to be based on the agency record.” Haneke v. Secretary of Health, Education, and Welfare, 175 U.S.App.D.C. 329, 337, 535 F.2d 1291, 1299 (1976) (citations omitted). The issue then is not whether the Court would have reached the same conclusion on the same facts, but rather, whether the administrative decision was arbitrary, capricious, or otherwise not in accordance with the law. See Haneke, supra. See also Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 414-416, 91 S.Ct. 814, 822-824, 28 L.Ed.2d 136 (1971).

Ill

The Act provides that in determining the rating of basic pay which an employee will receive, the principle of equal pay for substantially equal work will be followed. 5 U.S.C. § 5101(1)(A). Plaintiffs contend that in considering their complaint, OPM failed to follow the procedures mandated by the Act and relevant court decisions. Specifically, the plaintiffs feel that the defendants failed to follow the decision in Haneke, supra.

In Haneke, the plaintiff was a glass blower employed in the Instrument Shop of the Food and Drug Administration of the Department of Health, Education and Welfare. His position was classified under the “Wage Grade” system, and he sought conversion of his position to the General Schedule which would have given him a higher salary and greater fringe benefits. He asked the agency to compare his position with other workers in his own shop, all of whom worked on metal rather than glass, and with glass blowers in other named agencies, all of whom were classified under the General Schedule. The Court noted that the agency denied the reclassification request, “ruling that [plaintiff’s] position was properly classified under the Wage Grade Schedule, apparently without considering whether the other workers were, as alleged, doing identical work”. Haneke, 175 U.S.App.D.C. at 331, 535 F.2d at 1294 (footnotes omitted). Haneke appealed to CSC but his appeal was denied with a statement that, “[u]nder the law we must classify your position by comparing it with the applicable classification standard rather than any other position. A position-to-position classification system would be impossible to administer and would result in a never-ending classification process”. Id. The court held that the agency or CSC may not arbitrarily classify identical work differently. It further held that the decision does not require an agency or OPM to pursue a position-to-position comparison for initial classification, but that once a complaining employee identifies the comparison employees, then the agency or OPM should make a position-to-position comparison. 175 U.S.App.D.C. at 336, 535 F.2d at 1298. The Court also noted that such a comparison was not “impossible to administer” since Haneke had identified only a small number of employees. “All that is required [of the agency or OPM] is to identify those duties in the other position that qualify it for classification” and the complainant “can then attempt to show that his job meets all of those criteria, and" that [OPM’s] distinctions are without differences”. Id. Thereafter, the Court, after noting that “the district courts are engaged in limited judicial review” and that “their decisions are to be based on the agency record” went on to state the reasons for its review of Haneke, namely, “[f]or the purposes of the instant case, which presents purely a legal question of statutory construction, it is clear that the [CSC] was arbitrary and capricious in refusing even to consider whether it was applying two labels to the same work”. 175 U.S.App.D.C. at 337, 535 F.2d at 1299.

As a means of amplifying its decision, the Haneke court cited to the language of the Court of Claims in Testan v. United States, 499 F.2d 690, 205 Ct.Cl. 330 (1974), reversed on other grounds, 424 U.S. 392, 96 S.Ct. 948, 47 L.Ed.2d 114 (1976). The Testan court stated that

Ordinarily ... it is not arbitrary and capricious to refuse to consider the grade of employees other than the ones complaining ... Where, as here, employees all belong to a small readily manageable cadre, their jobs have a large nexus of duties shared in common, and the other employees are specifically pointed out by the complaining employees, we deem the case to be different. There may be a perfectly good explanation for the apparent discrepancy. We think as a reviewing court we are entitled to be informed by the CSC what it is, and not to have to take it on faith or speculate about it.

499 F.2d at 691.

In short, Haneke stands for the principle that when a federal employee can point to other federal employees who are doing the same work but receiving more pay, he has a right to complain under the Act. When he does, it is not enough for the agency or OPM to merely cite to the abstract definitions in the relevant regulations; rather, the agency or OPM must make, a meaningful comparison between the two positions and, if it is determined that there is a difference in the positions, be prepared to articulate the nature of those differences. Only in that manner can the agency or OPM insure that “the principle of equal pay for substantially equal work will be followed”. In Haneke, the agency and CSC did not follow that guideline, but chose instead to rest their determination upon the regulation or the applicable classification rather than on a position-to-position comparison. Such action was arbitrary and capricious under the facts of that case and therefore was subject to reversal by the court.

IV

Turning to the instant case, the Court notes that the defendants did not conduct a position-to-position comparison. Defendant’s Statement Of Material Facts As To Which There Is No Genuine Issue U16. Rather, OPM used a “core” summary and then sought to determine whether the plaintiffs’ position deviated from the “core”. The “core” purports to be a certificate.

The troubling aspect of this matter is that the defendants contended, and presumably still contend, that this case is not ripe for adjudication because, pursuant to OPM’s instruction of December 10, 1980, the Department of Defense (DOD) is investigating the positions of Planners and Estimators in the Army and the Navy. The defendants argue that this may answer the concerns the plaintiffs have raised with respect to similar positions in those departments, and it will result in more consistent classification among all Production Facilitating Positions in DOD. Thus, the defendants argue, this case is not ripe for adjudication. See Abbott Laboratories v. Gardner, 387 U.S. 136, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967). The Court had asked the parties whether they wish to file additional memoranda without specifically making reference to the above issue, but the parties have declined to do so. The Court assumes then that the agency is still conducting its survey.

The Court concludes, however, that it need not dwell on that issue in view of the decision in Barnhart v. Devine, 771 F.2d 1515 (D.C.Cir.1985). In that action, the plaintiffs requested that a position-to-position comparison be conducted to determine whether the plaintiff employees of the National Weather Service were performing substantially the same work as other National Weather Service employees classified at a higher pay level. OPM denied that request on the grounds that it was not required to make position-to-position comparisons and that it was only required to compare plaintiffs position to the pertinent classification standard promulgated under the Act. The Court of Appeals affirmed the dismissal of the action by the District Court noting that the plaintiffs were required to present their grievance to the Office of Special Counsel (OSC), since the complaint related to a “prohibited personnel practice”. That Court cited Haneke but noted the changes in administration of the government employment statute brought about by the Civil Service Reform Act of 1978, Pub.L. No. 95-457, 92 Stat. Ill (codified as amended in scattered sections of Title 5 of the United States Code).

The same rule should apply in the instant case since the plaintiffs, like those in Barnhart, have failed to use an alternative remedy which was available to them. Thus for these reasons this case must now be dismissed.

Although the Court dismisses this action, it must remind the defendants of their obligations under Haneke, as restated in Barnhart, that they, or the OCS, “might well be required to undertake a position-to-position comparison of the type contemplated by Haneke on the part of the old CSC”. Barnhart, at 1526, n. 20.

This action will be dismissed. An appropriate order has issued.