author: ASPEN, District Judge:

text:
    Lonnie S. WILLIAMS, Stanley Vivian and Hope Fair Housing Center, Plaintiff, v. Dennis ADAMS, a/k/a Dennie Adams, Mrs. Dennis Adams and Harry Bartlett, Defendant.
    No. 85 C 6358.
    United States District Court, N.D. Illinois, E.D.
    Nov. 14, 1985.

      Jeffrey L. Taren, Kinoy, Taren, Geraghty & Potter, Michael J. Kaufman/Fay Clayton, Sachnoff, Weaver & Rubenstein, Chicago, 111., for plaintiff.
    Harry S. Weber, Chicago, 111., for defendant.
   MEMORANDUM OPINION AND ORDER

ASPEN, District Judge:

This case involves alleged racial discrimination on the part of the owner of two rooming houses and his agents. Individual plaintiffs Lonnie Williams (“Williams”) and Stanley Vivian (“Vivian”) and corporate plaintiff Hope Fair Housing Center (“Hope”) filed this suit under provisions of the Fair Housing Act of 1968, 42 U.S.C. § 3604 (1982) and the Civil Rights Act of 1866, as amended, 42 U.S.C. § 1982 (1982). They complained that defendant Dennis Adams (“Adams”), the owner of two rooming houses, and his agents, Mrs. Dennis Adams (“Mrs. Adams”) and Harry Bartlett (“Bartlett”), wrongfully refused to rent available housing to Vivian and refused to continue renting to Williams on the basis of race. Vivian and Williams are black citizens. The matter currently pending before this Court is the defendants’ motion to dismiss the complaint. For the following reasons, the motion is granted in part and denied in part.

I. Factual Allegations

For the purposes of this motion, we assume that the facts alleged are true and view them, along with all reasonable inferences to be drawn from them, in the light most favorable to the plaintiffs. Powe v. City of Chicago, 664 F.2d 639, 642 (7th Cir.1981). Furthermore, we cannot grant the motion to dismiss for failure to state a claim unless it appears beyond doubt that the plaintiffs can prove no set of facts which would entitle them to relief. Hishon v. King & Spalding, 467 U.S. 69, 104 S.Ct. 2229, 2233, 81 L.Ed.2d 59 (1984); Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957). With these standards in mind, we turn to the complaint.

The complaint states that on or about February 7, 1985, two of the defendants, Mr. and Mrs. Adams, provided false information to Vivian about housing availabilities at their properties. They also refused to rent, refused to negotiate for the rental of housing and otherwise made housing unavailable to Vivian because of his race. On June 2, 1985, or thereabout, defendant Adams, through his agent, Bartlett, refused to continue renting a room to Williams, also on the basis of his race. At all times during this period, housing was available at both of the rooming houses owned and operated by defendants, and the individual plaintiffs were ready, willing and able to rent rooms at the defendants’ rental price. In carrying out these actions, it is charged that defendants acted intentionally and maliciously with willful and wanton disregard for the plaintiffs’ rights and feelings.

The third plaintiff, Hope Fair Housing Center (“Hope”), is an Illinois not-for-profit corporation with offices in Lombard, Illinois, a western suburb of Chicago. It alleges, as discussed in further detail below, that it, too, has an interest in the outcome of this litigation and thus should be conferred standing to sue along with the individual plaintiffs, Williams and Vivian.

II. The Motion to Dismiss

A. Hope’s Standing

This case presents the Court with the interesting issue of the extent to which an organization must allege an injury to establish standing to sue. Defendants have moved to have plaintiff Hope dismissed from this case for lack of standing. They assert that Hope has not alleged that it has personally suffered any actual or threatened injury caused by the defendants’ alleged discriminatory conduct with regard to plaintiffs Williams and Vivian.

The issue of standing is a central question of jurisdiction, involving basic notions of the justiciability of a particular plaintiff’s claim in the federal court system. Its constitutional underpinnings are in the “case or controversy” requirement of Article III of the Constitution. Warth v. Seldin, 422 U.S. 490, 498, 95 S.Ct. 2197, 2205, 45 L.Ed.2d 343 (1975). The constitutional element of the standing requirement necessitates an inquiry into whether the plaintiff has alleged a sufficient personal stake in the outcome of the controversy to warrant his or her invocation of federal jurisdiction which would justify the exercise of the court’s remedial powers on the plaintiff’s behalf. Id.; Baker v. Carr, 369 U.S. 186, 204, 82 S.Ct. 691, 703, 7 L.Ed.2d 663 (1962).

Given these general standards, we now explore their application to the plaintiff Hope. The federal courts have often been asked to define the extent to which organizations with an interest in the outcome of particular litigation may maintain standing. In fact, groups organized to oppose housing discrimination often have been, as here, at the heart of the litigation. See, e.g., Havens Realty Corp. v. Coleman, 455 U.S. 363, 377, 102 S.Ct. 1114, 1123, 71 L.Ed.2d 214 (1982); Hope, Inc. v. County of Du-Page, 738 F.2d 797 (7th Cir.1984). An organization such as Hope may assert standing for itself, or in its representative capacity in behalf of its members. Warth, 422 U.S. at 511, 95 S.Ct. at 2211.

In the present case, Hope has pled that its purpose:

is to promote the formation and continuation of an integrated community, the provision of housing on a nondiscriminatory basis and the building of low-income housing in the Western suburbs [sic] of Chicago. Plaintiff organization has an interest in the outcome of this litigation in that the maintenance of a policy of racial discrimination by the defendants, as alleged, is essential to the aims and policies of its organization and creates barriers for housing to many of its clients.

Plaintiffs’ Complaint, If 5. However, no further allegations regarding the effect of the defendants’ conduct on Hope appear anywhere in the complaint. Furthermore, Hope has not pled whether it seeks standing in its own behalf or in a representative capacity in behalf of its clients.

Despite its lack of clarity, the complaint seems to convey the idea that the harm alleged to have resulted from the defendants’ discriminatory practices was that those practices countered Hope’s goals and policies and, in addition, limited the availability of housing to Hope’s clients. The question in this case is whether an injury to these interests is sufficient to establish standing.

It is clear that standing can be conferred on an organization based purely on non-economic interests which are being harmed in some way by the defendants. Sierra Club v. Morton, 405 U.S. 727, 734, 92 S.Ct. 1361, 1366, 31 L.Ed.2d 636 (1972). However, the organization still must be subjected to some “distinct and palpable injury” linked to the defendants’ behavior, Warth v. Seldin, 422 U.S. 490, 501, 95 S.Ct. 2197, 2206, 45 L.Ed.2d 343 (1975), and the injury alleged must be more than the mere abstract injury to social interest rejected by the Supreme Court as insufficient to confer standing in Sierra Club v. Morton. Furthermore, the injury must be such that it “is likely to be redressed by a favorable decision” by the court. Simon v. Eastern Kentucky Welfare Rights Organization, 426 U.S. 26, 38, 96 S.Ct. 1917, 1924, 48 L.Ed.2d 450 (1976).

The standards set forth by the Supreme Court in its standing cases were applied to an organization quite similar in function to Hope in Havens Realty Corp. v. Coleman, 455 U.S. 363, 377, 102 S.Ct. 1114, 1123, 71 L.Ed.2d 214 (1982). Havens involved a lawsuit brought by individuals and an organization called “HOME” against the owner of an apartment complex who had allegedly engaged in the practice of racial steering. HOME, as alleged in the complaint in Havens, was a non-profit Virginia corporation dedicated to making “equal opportunity in housing a reality in the Richmond Metropolitan Area.” Havens, 455 U.S. at 368, 102 S.Ct. at 1119 (citing plaintiffs’ complaint). HOME operated a housing counseling service and investigated complaints of housing discrimination. Id.

In asserting an injury for the purposes of fulfilling the standing requirement, HOME alleged that the defendants’ steering practices “frustrated” HOME’S counseling and referral services, causing a drain on its resources. Justice Brennan, writing for a unanimous Court, upheld HOME’S standing to sue, declaring that:

If, as broadly alleged, petitioners’ steering practices have perceptibly impaired HOME’S ability to provide counseling and referral services for low- and moderate-income homeseekers, there can be no question that the organization has suffered injury in fact. Such concrete and demonstrable injury to the organization’s activities — with the consequent drain on the organization’s resources — constitutes far more than simply a setback to the organization’s abstract social interests ____

Havens, 455 U.S. at 379, 102 S.Ct. at 1124.

With respect to claims of standing in its own behalf, it is not enough that an organization allege that a particular defendant’s conduct is against the policies or goals of that organization. It is precisely this type of broad organizational interest which the Supreme Court rejected in Sierra Club v. Morton, 405 U.S. 727, 739-40, 92 S.Ct. 1361, 1368, 31 L.Ed.2d 636 (1972), since it is too abstract to represent a meaningful basis for standing. If this type of interest were all that is necessary to establish standing, Hope would have standing in every individual case of alleged housing discrimination in DuPage County, or perhaps in an even broader geographical area.

In each of the cases on which plaintiff Hope relies, there is a more particularized allegation of injury directly linked to the defendant’s conduct. In Havens, for example, the plaintiff organization alleged that it had devoted significant resources in identifying and attempting to counteract the defendants’ racially discriminatory steering practices. Havens, 455 U.S. at 379, 102 S.Ct. at 1124. Hope also cited two cases from the Northern District of Illinois in which it was permitted standing to sue along with individual plaintiffs in housing discrimination actions. In Ross v. Palco Construction Co., No. 83 C 4029, slip op. (N.D.Ill. Oct. 4, 1983), there was a specific allegation that Hope Fair Housing Center was injured in its business since substantial amounts of funding for the organization were dependent on its success in placing clients in housing, and the defendants’ discriminatory policies inhibited that success. The other district court case cited by plaintiff Hope, Coleman v. Chateaux Lorraine Apartments, No. 84 C 2433, slip op. (N.D. Ill. Sept. 4, 1984), is also distinguishable. There, as in Ross, Hope Fair Housing Center alleged that its public funding was dependent on its success in housing placement of minority clients. Furthermore, it was clear that the individual plaintiffs in Coleman were clients of Hope. Coleman, slip op. at 2. Therefore, Hope could easily have established standing either in an individual or a representative capacity in the Coleman case.

The Seventh Circuit Court of Appeals dealt with the issue of group standing in Hope, Inc. v. County of DuPage, 738 F.2d 797 (7th Cir.1984). In that case, ten individuals and Hope, Inc. (we assume that is the same organization as the present plaintiff) brought an action against DuPage County, members of its board and specific private landowners alleging that these defendants had unlawfully engaged in exclusionary housing practices. The district court granted standing to Hope in its representative capacity since it was determined that some of its directors were low- or moderate-income persons who alleged a distinct and palpable injury. On appeal, the defendants challenged the standing of both the individual plaintiffs and Hope. Hope argued that it had standing in its representative capacity, or in the alternative, that it had standing to sue in its own behalf.

The Seventh Circuit rejected both of Hope’s standing claims and reversed the district court. In denying Hope’s claim with respect to standing to sue in its own behalf, the Seventh Circuit held that Hope’s inability to show any causal connection between the defendants’ actions and the alleged injury to its corporate purpose was a fatal defect in its standing claim. The court distinguished Havens by pointing out that Havens involved “specific and particular discriminatory activity in violation of the plaintiffs’ rights.” Hope, Inc., 738 F.2d at 815. The Seventh Circuit noted that:

[T]he very problem with the plaintiffs’ allegations and proof in the present case (both the individual plaintiffs and HOPE) is that they fail to allege specific and particular discriminatory acts such as denial of zoning variations and special-use permits for low and moderate income housing projects.

Id.

However, the problem that presented itself in the Seventh Circuit Hope, Inc. decision does not appear here. In this case, there is clearly an allegation of specific and particular discriminatory activity sufficient to establish standing for the individual plaintiffs. The problem here is that nowhere in the complaint has Hope articulated how it or any of its members have been harmed by the defendants’ actions.

The Seventh Circuit also reversed the district court’s finding that Hope had standing to sue as a representative of its members. The Supreme Court had declared in Warth v. Seldin, 422 U.S. 490, 511, 95 S.Ct. 2197, 2211-12, 45 L.Ed.2d 343 (1975), that in order to establish standing in a representative capacity, an organization must allege that one or more of its members is suffering a real or threatened injury such that the member or members would have standing independently. See also Hunt v. Washington State Apple Advertising Commission, 432 U.S. 333, 343, 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1977); International Union v. Johnson, 674 F.2d 1195, 1200 (7th Cir.1982). Following this standard, the Seventh Circuit held that the individual plaintiffs did not have standing in their own right, and that Hope did not have standing in a representative capacity as a result. Hope, Inc., 738 F.2d at 814. In the present case, while Hope made a reference in the complaint to injury to its clients there is no indication that the two individual plaintiffs are clients of Hope such that standing in a representative capacity could be maintained. Nor is there a particular allegation of specific injury to any other clients or members of Hope.

In applying the standards set forth by the Supreme Court and the Seventh Circuit in this area, we cannot uphold Hope’s standing in the present case. Accordingly, we grant defendants’ motion to dismiss Hope.

B. Sufficiency of the Pleadings

Defendants’ second ground for dismissal is based on a contention that the allegations in the complaint are merely conclusions and should be stricken from the pleadings as without merit. It is elementary to most practitioners that pleadings in federal court need only comply with the “notice pleading” standard. Notice pleading means simply that in order to state a claim for relief, the plaintiff need only notify the defendant of the theory behind the claims alleged and the basic grounds which support those claims. See Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 103, 2 L.Ed.2d 80 (1957); Maclin v. Paulson, 627 F.2d 83, 86 (7th Cir.1980). Fed.R.Civ.P. 8(a)(2) requires only a short and plain statement of the claim showing that the pleader is entitled to relief. That the plaintiffs in the present case have met these requirements is apparent from even a cursory reading of the complaint. In Paragraphs Nine and Ten of the complaint, plaintiffs have set out the type of conduct alleged, the persons involved and the dates of the alleged incidents leading to the discrimination claims. Defendants here clearly have fair notice of the claims filed against them. Their motion is meritless. Their efforts and resources would be more wisely spent in establishing their defense.

C. Punitive Damages

The defendants’ third basis for their motion is an assertion that plaintiffs’ plea for $100,000 in punitive damages should not be allowed since provisions of the Fair Housing Act limit such relief to $1,000. 42 U.S.C. § 3612(c) (1982). However, plaintiffs bring this suit not only under the Fair Housing Act, but also under the Civil Rights Act of 1866, as amended, 42 U.S.C. § 1982 (1982), which has no limit on recovery for punitive damages. Where a plaintiff brings suit under both statutes in conjunction with the same defendant, the limitation on punitive damages does not apply. Phillips v. Hunter Trails Community Association, 685 F.2d 184, 191 (7th Cir.1982).

Defendants are also mistaken in asserting that plaintiffs have failed to plead malice or willful and wanton misconduct as a prerequisite to the punitive damages claim. In Paragraph 12 of their complaint, plaintiffs alleged that the defendants “acted intentionally and maliciously and were guilty of willful and wanton disregard for the rights and feelings of plaintiffs.” Without further discussion, we disagree with defendants on this ground.

III. Rule 11 Sanctions

In their response to the defendants’ present motion, the plaintiffs have requested this Court to impose sanctions on the defendants for their assertedly frivolous motion. Since we have granted one of the defendants’ three claims, we cannot agree that “[njot one of the arguments presented ... is warranted by existing law or by a good faith argument for the reversal, modification or extension of existing law.” Plaintiffs’ Response to Defendants’ Motion to Strike and Dismiss Complaint at 5. And, while we agree that the other two claims by the defendant are unfounded, we decline to exercise our discretion in imposing sanctions against the defendants pursuant to Fed.R.Civ.P. II.

IV. Conclusion

The defendants’ motion to dismiss plaintiff Hope Fair Housing Center from the complaint is hereby granted. Defendants’ motions are denied in all other respects. Plaintiffs’ motion for the imposition of Rule 11 sanctions is denied. It is so ordered.

      . That provision states in pertinent part:
      As made applicable by section 3603 of this title and except as exempted by sections 3603(b) and 3607 of this title, it shall be unlawful—
      (a) To refuse to sell or rent after the making of a bona fide offer, or to refuse to negotiate for the sale or rental of, or otherwise make unavailable or deny, a dwelling to any person because of race, color, religion, sex, or national origin.
      (b) To discriminate against any person in the terms, conditions, or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of race, color, religion, sex, or national origin.
      (c) To make, print, or publish, or cause to be made, printed, or published any notice, statement, or advertisement, with respect to the sale or rental of a dwelling that indicates any preference, limitation, or discrimination based on race, color, religion, sex, or national origin, or an intention to make any such preference, limitation, or discrimination.
      (d) To represent to any person because of race, .color, religion, sex, or - national origin that any dwelling is not available for inspection, sale, or rental when such dwelling is in fact so available.
      (e) For profit, to induce or attempt to induce any person to sell or rent any dwelling by representations regarding the entry or prospective entry into the neighborhood of a person or persons of a particular race, color, religion, sex, or national origin.

      . That provision states:
      All citizens of the United States shall have the same right, in every State and Territory, as is enjoyed by white citizens thereof to inherit, purchase, lease, sell, hold, and convey real and personal property.

      . Defendants’ motion was formally predicated on Fed.R.Civ.P. 12(f) as a motion to strike "from any pleading, any insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” Fed.R.Civ.P. 12(f). However, this Court notes that motions to strike are generally disfavored and rarely granted. See 5 C. Wright & A. Miller, Federal Practice and Procedure, § 1380 (1969). Moreover, a motion to strike is “neither an authorized nor a proper way to procure the dismissal of all or part of a complaint____” Id. (Footnote omitted). Notwithstanding defense counsel’s mislabeling of this motion, we will entertain this motion as a motion to dismiss for failure to state a claim under Fed.R.Civ.P. 12(b)(6), which is how it properly should have been filed.

      . Certain non-constitutional limits on standing also have been imposed by the United States Supreme Court, even where the minimum Article III standing requirements have been met. These limits reflect the Court’s concerns that the judicial branch of the government confine its inquiries to particularized grievances rather than "abstract questions of wide public significance." Warth, 422 U.S. at 500, 95 S.Ct. at 2206. As summarized by the Court in Warth, these standards direct that, in order to establish standing, (1) the plaintiff's harm must be more than a generalized grievance shared "in substantially equal measure" by all or a large class of citizens; and (2) the plaintiff generally must assert his or her own legal rights and interests, and not merely those of third parties. 422 U.S. at 499, 95 S.Ct. at 2205. Because defendants have framed their arguments in terms of the constitutional question, we deal only peripherally with these nonconstitutional issues.

      . The plaintiffs seem to have inadvertently omitted some words from the last sentence of this paragraph of the complaint. We assume that the plaintiffs complain not that defendants’ "maintenance of a policy of racial discrimination ... is essential to the aims and policies of its organization” but that such a policy undermines those aims and policies.

      . Racial steering is the practice by certain real estate brokers and agents of preserving and encouraging racial segregation in housing by "steering” members of different racial groups to buildings or neighborhoods already predominantly occupied by members of the same group.

      . HOME’S complaint stated that:
      Plaintiff HOME has been frustrated by defendants' racial steering practices in its efforts to assist equal access to housing through counseling and other referral services. Plaintiff HOME has had to devote significant resources to identify and counteract the defendant’s [sic] racially discriminatory steering practices.

        Havens, 455 U.S. at 379, 102 S.Ct. at 1124.

      . While we decline to impose formal sanctions, we do wish to address language used in defendants' reply memorandum, which reads in part:
      In conclusion, Defendant notes that plaintiff has termed defendants’ Motion to Strike as frivolous, the [sic] only thing frivolous here is plaintiffs’ assertions that plaintiff, Lonnie Williams, was rented to even though he was black and refused continued rental because he is black. Maybe, Lonnie Williams performed some black magic.

        Defendants' attempts at humor are both inappropriate and unhelpful in resolving this controversy. In our view, racial discrimination is a serious subject deserving serious treatment.


source: Caselaw Access Project

author: SWEET, District Judge.

license: Public Domain

text:
    Albert P. ABEL, Plaintiff, v. Albert L. BONFANTI, III, Fast Food Operators, Inc., d/b/a Popeyes Famous Fried Chicken and Biscuits, Hyman Schifrin, Alan Altman, Stanley Ratner and Steven Roman, Defendants.
    No. 84 Civ. 9161 (RWS).
    United States District Court, S.D. New York.
    Nov. 22, 1985.

      Rundle-Britton, New York City, for plaintiff; Katharine A. Rundle, Ruth H. Schlesinger, of counsel.
    Shea & Gould, New York City, for defendants (Except Altman); Mark E. Davidson, of counsel.
    Moskowitz, Altman & Frankel, New York City, for defendant Alan Altman; Hyman Frankel, of counsel.
   OPINION

SWEET, District Judge.

The defendants in this action, Albert L. Bonfanti III (“Bonfanti”), Fast Food Operators, Inc., d/b/a Popeyes Famous Fried Chicken and Biscuits (“FFO”), Hyman Schifrin (“Schifrin”), Alan Altman (“Altman”), Stanley Ratner (“Ratner”) and Steven Roman (“Roman”) have moved for summary judgment dismissing the complaint pursuant to Fed.R.Civ.P. 56. For the following reasons defendants’ motion will be granted in part and denied in part.

Pleadings and Facts

Plaintiff Albert P. Abel (“Abel”) filed this action in December, 1984 after being fired from his position as vice president of FFO. Abel, who is a white male employee, alleges in his complaint the violation of his civil rights, 42 U.S.C. §§ 1981, 1982, conspiracy to violate his civil rights, 42 U.S.C. § 1985, illegal wiretapping, 18 U.S.C. §§ 2511, 2520, breach of contract, fraud, defamation and tortious interference with his business and occupation.

Abel’s complaint is based on the following set of facts drawn from the affidavits submitted with this motion. The facts, of course, must be construed in a manner most favorable for the party resisting summary judgment.

In January, 1984, the then-president of FFO, Aaron R. Fodiman (“Fodiman”), resigned. The Board of Directors of FFO hired Bonfanti to replace Fodiman as president and chief financial officer of FFO. Abel was then, as he had been since April, 1982, FFO’s Director of Operations. As such, Abel was responsible for the daily operation of the ten Popeyes’ Fried Chicken restaurants, and the hiring, firing and training of all management and supervisory personnel.

1. Alleged discriminatory acts

Around January 6, 1984 Bonfanti met with FFO’s managers and supervisors to discuss his position as president of the corporation and the policies he intended to implement. Bonfanti stated to those managers and supervisors that FFO would no longer permit the hiring of individuals whose religious beliefs required the wearing of head coverings or beards. While this policy had not been enforced by the previous management, it was required under the pre-existing FFO Employee Guide. Abel contends that Bonfanti stated privately to him that FFO should cease the practice of hiring non-Americans.

Abel asserts that FFO’s Middle Eastern managers were extremely upset at this new discriminatory policy that attacked their religious beliefs and wrote a letter to the Board of Directors expressing their fears and their support for Abel. These letters, however, do not include any indication of Bonfanti’s alleged discrimination or of any discriminatory practices at FFO. Instead, they establish, at most, a strong personal allegiance to Abel and disappointment that Abel was not selected to become president of FFO.

On February 3, 1984, just two weeks after Bonfanti joined FFO, Abel tendered his written resignation to the entire Board of Directors of FFO, allegedly because he objected to Bonfanti’s racially discriminatory policies regarding the Middle Eastern and other non-white managers and supervisors. The other reason cited by Abel for his tendered resignation was his frustration with overseeing Bonfanti’s expenses in his duty to act as a comptroller over the FFO operations. At a meeting with Schifrin and Altman, Abel was persuaded to remain with FFO and was allegedly promised that he could be terminated only for cause.

In March and April of 1984, Abel alleges that Bonfanti discriminatorily ordered the firing of three Sikh Indians. With regard to these three Indian managers, Messrs. Dhawan, Singh and Chawla, the uncontradicted evidence establishes that each of these managers’ personnel records contained reprimands by store supervisors which requested that the managers be terminated. Mr. Ajit Dhawan was fired on March 8, 1984 after verbal and written reprimands from his store supervisor, Beverly Levinson. Mr. Gucharran Singh was reprimanded by his supervisor Malek Sulaiman on May 7, 1984 and after several more reprimands, quit voluntarily on June 11, 1984. Finally, Mr. Surinder Singh Chawla was reprimanded in several occasions by supervisors Vikvam Bhalla and Malek Sulaiman and was finally fired on July 30, 1984.

It is further uncontested that after Bonfanti began working as president of FFO and throughout the time period of Abel’s complaint, FFO continued to hire a very high percentage of minority management employees. Thus, out of 27 management employees hired between January 26 and October 1, 1984, four were white Americans, six were black, six were from Latin America or the Caribbean, and eleven were from Pakistan or India.

Abel asserts that three of the white Americans and two light-skinned Latin Americans were hired as a result of Bonfanti’s preference and favoritism of “whites” over “non-whites”. However, each of these employee candidates were previously associated with Bonfanti in the food business which he operated prior to joining FFO. Moreover, several of those forced hires were soon fired either by Abel or Bonfanti. Abel has also submitted evidence that the minority management employees earned on average approximately $100 less per week than the white and Hispanic managers. At the same time, however, it has been established that, within the small sample examined by Abel, the white and Hispanic employees had almost eight years of prior experience in the food services business while the minority employees had only about four years of prior experience.

2. Alleged wiretapping acts

Around February, 1984, Bonfanti installed a voice activated tape recorder which could continuously record all calls on one of FFO’s four telephone lines. The recorder was concealed beneath Bonfanti’s office desk, and he did not reveal its existence to any subordinates. Bonfanti indiscriminately taped conversations placed on that telephone line. In April, 1984, Abel learned of the existence of this tape recording device from another employee and having found the device under Bonfanti’s desk, removed one tape. Abel brought the tape recording to FFO’s inhouse counsel, Altman, who destroyed the tape recording and advised Bonfanti that he should discontinue his practice of tape recording calls placed over that line. Upon the uncontradicted affidavit of Bonfanti, it appears that Bonfanti immediately disconnected the tape recorder. Abel made no further complaints about any wiretapping, but claims to have seen the recording device in Bonfanti’s office on October 2, 1984, the day of his dismissal.

3. The dismissal

Over the months following the withdrawal of his resignation in February, 1984, Abel allegedly discovered numerous blatantly illegal practices and acts by Bonfanti including deliberate misrepresentations on an SEC filing, fraudulent insurance claims, fraudulent expense vouchers and the recruitment of an employee of FFO’s franchise to engage in industrial espionage. Abel reported all of these events to FFO’s Board of Directors, including Schifrin and Altman.

Around September 27, 1984, Bonfanti requested a private meeting with Abel in which he demanded either the full personal commitment of Abel or else his resignation. Abel reported the content of this meeting to Schifrin. Around October 1, Bonfanti and Abel had another private meeting during which Abel expressed his commitment only to FFO rather than to Bonfanti personally, and during which Bonfanti accused Abel of “bugging” his office to obtain evidence of any damaging information. Finally, on October 2, 1984, Abel was summoned to a meeting with Bonfanti and Schifrin at which time Schifrin also accused Abel of bugging Bonfanti’s office. While there is no evidence that Abel actually “bugged” Bonfanti’s office, he apparently admitted to Schifrin that he had told Bonfanti about such activity. Accompanied by an obscenity, Schifrin yelled at Abel, “You’re fired.”

Discussion

I. Retaliatory discrimination under 42 U.S.C. § 1981

Section 1981 provides a federal remedy against discrimination in private employment on the basis of race and states that:

All persons within the jurisdiction of the United States shall have the same right in every State and Territory to make and enforce contracts, to sue, be parties, given evidence, and to the full and equal benefit of all laws and proceedings for the security of persons and property as is enjoyed by white citizens, and shall be subject to like punishment, pains, penalties, taxes, licenses, and exactions of every kind, and to no other.

This Circuit has held that a white person who has been punished for trying to vindicate the rights of minorities may bring an action under § 1981, DeMatteis v. Eastman Kodak Company, 511 F.2d 306, reh’g on other grounds, 520 F.2d 409 (2d Cir.1975). More recently, the Second Circuit has set forth the standard for employment discrimination claims under § 1981. Choudhury v. Polytechnic Institute of New York, 735 F.2d 38 (2d Cir.1984). The same elements required for a claim for discrimination under Title VII are sufficient to state a claim under § 1981. Id. at 44. In turn, the elements which state a Title VII retaliation suit have been set forth in Grant v. Bethlehem Steel Corp., 622 F.2d 43 (2d Cir.1980). Thus Abel must show that:

(1) he engaged in an activity protected under Title VII, of which defendant employer had knowledge,
(2) that defendant employer harmed plaintiff in his employment, and
(3) that a causal connection between the first two elements exists, that is, a retaliatory motive played a part in the employer’s adverse employment actions.

With regard to the first element of a prima facie case for retaliation, Abel is not required to show that the underlying challenged activity was in fact illegal discrimination. In Choudhury, supra, 735 F.2d at 43, the Court stated that “[a]n employee who is punished for seeking administrative or judicial relief, regardless of the merits of his initial claim, has failed to secure the right to equal treatment which constitutes the fundamental promise of § 1981.” In this action, of course, Abel did not seek any administrative or judicial remedies for the alleged discrimination to FFO’s minority employees, but merely complained to his immediate superior. In these circumstances of “informal” protected activity, a plaintiff must demonstrate a good faith, reasonable belief that the underlying challenged actions of the employer violated the law. Francoeur v. Corroon & Black Co., 552 F.Supp. 403, 412 (S.D.N.Y.1982). See Parker v. Baltimore & Ohio Railroad, 652 F.2d 1012, 1020 (D.C.Cir.1981).

Without deciding whether the actions taken by FFO during Bonfanti’s tenure actually represent discriminatory practices which violate the law, those facts do not support the inference that Abel had a good faith belief that there existed discriminatory employment practices at FFO. The February speech by Bonfanti requiring of clean-shaven employees is racially neutral, and while Abel asserts that the requirement was intended to discriminate against Sikh Indians, such religious discrimination is irrelevant for the purposes of a § 1981 claim. See Catholic War Veterans of U.S., Inc. v. City of New York, 576 F.Supp. 71, 74 (S.D.N.Y.1983). Moreover, such a requirement was entirely consistent with a long-standing employee rule at FFO and the health guidelines of the City of New York. Abel has brought forth no evidence to show that this requirement was a mere pretext.

With regard to the alleged dismissal of three Indian employees and the forced hiring of white employees, the record indicates an absence of discriminatory treatment. The majority of new employees hired after Bonfanti became president were from minority groups; each of the Indians were dismissed or resigned for legitimate business reasons, and the white employees were recommended by Bonfanti because they were formerly employed by him at another company. Finally, the $100 differential in white and minority salaries was not mentioned in Abel’s complaint and, therefore, it is highly unlikely that this evidence, brought forth in the process of this litigation, was ever noticed by Abel when he was actively employed by FFO.

Finally, Abel offers nothing but conclusory allegations that he was engaged in “protected activity” under Title VII. His affidavit merely states that “[ejveryone knew that I was trying to get Bonfanti to back off from his racial discrimination.” Despite this claim, Abel has not submitted any supporting affidavits from alleged victims of discrimination nor any contemporaneous evidence of his efforts to prevent the alleged discriminatory actions of Bonfanti. Therefore, the basis for Abel’s claim of good faith objection to discriminatory practices rests solely on unspecific and unsupported allegations and “such conclusory allegations of discrimination are insufficient to satisfy the requirements of Rule 56(e).” Meiri v. Dacon, 759 F.2d 989, 998 (2d Cir.), cert. denied, — U.S.-, 106 S.Ct. 91, 88 L.Ed.2d 74 (1985).

Even assuming that Abel did engage in a protected activity and complained about perceived discriminatory practices, his § 1981 claim must be dismissed for another reason. There is no evidence on the record to suggest that Schifrin’s decision to fire Abel on October 2, 1984 was in any way connected to Abel’s alleged resistence to Bonfanti’s speech to the employees in February, 1984 or the termination of the Indian managers during March and July of 1984. There is abundant evidence in Abel’s own complaint and affidavits that his personal struggle with Bonfanti revolved around his duties as comptroller and the accusation that Abel bugged Bonfanti’s office. While it is true that this Circuit recently rejected the requirement of “but for” causation in retaliatory discrimination cases, see Grant, supra, 622 F.2d at 46; Sims v. Mme. Paulette Dry Cleaners, 580 F.Supp. 593, 596 (S.D.N.Y.1984), Abel must nevertheless set forth some evidence that the “adverse action was at least in part because [he] engaged in protected activities.” Sims, supra, 580 F.Supp. at 596.

Abel asserts that the failure of defendants to discuss the bugging charge at greater length indicates it was a mere pretextual reason to obscure the strong discriminatory animus against Abel. The case cited in support of this proposition, however, is distinguishable. See Francoeur, supra, 552 F.Supp. at 410-11. In the Francoeur case, the plaintiff had filed a formal EEOC charge barely one month pri- or to her dismissal. The pretextual incident proffered by the defendant was a single personnel dispute which arose in plaintiff’s department. The court found very significant the fact that defendant’s representatives failed even to mention this personnel dispute to the plaintiff, although they spoke with her the day before she was fired. The present case does not remotely resemble the Francoeur case. Here, as opposed to the situation in Francoeur, the allegedly pretextual reason was referred to at the time of firing. The facts alleged are insufficient to support the conclusory allegations of discriminatory retaliation. Therefore, Abel’s first cause of action under 42 U.S.C. § 1981 must be dismissed.

Since there is nothing to indicate that the defendants, collectively or individually, intended to dismiss Abel because of his resistance to their alleged discriminatory practices, Abel’s third cause of action alleging a conspiracy under 42 U.S.C. § 1985(3) must also be dismissed.

II. Abel’s property rights under 42 U.S.C. § 1982

In his second cause of action, Abel contends that defendants violated 42 U.S.C. § 1982 by terminating his employment agreement and interfering with his business interests and employment. Section 1982 provides that:

All citizens of the United States shall have thé same right, in every State and Territory, as is enjoyed by white citizens thereof to inherit, purchase, lease, sell, hold, and convey real and personal property.

42 U.S.C. § 1982. Abel’s claim is not well-founded because § 1982 applies to racial discrimination with respect to transactions in real and personal property but not to employment discrimination claims. See Johnson v. Duval Country Teachers Credit Union, 507 F.Supp. 307, 310 (M.D.Fla.1980); Foreman v. General Motors Corp., 473 F.Supp. 166, 177 (E.D.Mich.1979).

While the Supreme Court has recognized, under some circumstances, a property right m continued employment, Board of Regents v. Roth, 408 U.S. 564, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1971), such a property interest has not been recognized as protected by § 1982. Tate v. Hills-McCanna Co., 29 Empl.Prac.Dec. (CCH) ¶ 32,944 at 26,463 (N.D.Ill.1982). In Tate, supra, the Court stated:

“While employment discrimination claims are not expressly excluded from section 1982, the wording of that provision clearly limits its application to transactions in real and personal property, such as leasing, selling and conveying such property.”

Whatever property rights Abel may be able to establish regarding his alleged right to continued employment at FFO, these rights are not those than can be inherited, purchased, leased, sold or conveyed, and, therefore, are not covered by § 1982.

III. Defendants’ alleged illegal wiretapping

Abel has asserted that Bonfanti violated 18 U.S.C. §§ 2511 and 2520 by tape recording telephone calls placed on one of FFO’s telephone lines. Section 2511 establishes criminal liability for any person who “wilfully intercepts ... any wire or oral communication ____” Section 2520 provides a private right of action for actual and punitive damages to “[a]ny person whose wire or oral communication is intercepted, disclosed or used in violation of this chapter....”

Bonfanti argues that Abel’s wiretapping cause of action must be dismissed for two reasons. He relies first upon 18 U.S.C. § 2510(5)(a) which provides an exemption to n on-consensual overhearing of communications over an extension phone which is being used in the ordinary course of business. See Anonymous v. Anonymous, 558 F.2d 677, 678-79 & n. 5 (2d Cir.1977). Section 2510(5)(a)(i) provides the so-called extension phone exemption from the federal wiretapping laws. It states that:

(5) “electronic, mechanical, or other device” means any device or apparatus which can be used to intercept a wire or oral communication other than—
(a) any telephone or telegraph instrument, equipment or facility, or any component thereof, (i) furnished to the subscriber or user by a communications carrier in the ordinary course of business and being used by the subscriber in the ordinary course of its business____

The Anonymous opinion apparently is the only interpretation of the extension phone exemption in this Circuit. It is of limited usefulness in the present case since the Court in Anonymous was faced with a purely domestic conflict in which the defendant husband had instructed his son to tape record all incoming telephone calls from his wife. The Court held that the defendant’s eavesdropping and recording of his wife’s and daughter’s conversations from an extension phone were in the ordinary course of business since the legislative history explicitly stated that such personal conversations overheard by family members were not intended to be punishable under the wiretapping statute. Moreover, the Court held that the use of a tape recording device to preserve a conversation on an extension phone in the absence of the husband did not make that eavesdropping unlawful.

The defendant in Anonymous tape recorded the conversations by means of an automatic answering machine purchased from a local retail store. While such a device appears not to be an instrument furnished to the subscriber by a communications carrier as required by the statutory exemption, the Court nevertheless found the extension phone exemption applicable. Therefore, it appears that the means of intercepting the communication, as long as the device is attached to an extension phone outlet, is irrelevant except insofar as it relates to whether the interception is in the ordinary course of business. The other aspect of the statute which was not directly addressed in the Anonymous opinion was the clause “being used by the subscriber or user in the ordinary course of its business ____”

By distinguishing several cases decided in other Circuits, the Anonymous opinion provided a tentative outline of the extension phone exception. The Court expressed approval of the holdings in United States v. Jones, 542 F.2d 661 (6th Cir.1976), and United States v. Schrimsher, 493 F.2d 848 (5th Cir.1974), which upheld the applicability of the wiretap statistics in situations where the defendants indiscriminately taped all incoming and outgoing calls of their wife or lover and thus “invaded the privacy of innumerable persons, known and unknown.” Id. at 679. At the same time, the Court rejected the broader holding of United States v. Harpel, 493 F.2d 346 (10th Cir.1974), that no eavesdropping over an extension phone without one party’s consent would be in the ordinary course of business. Id. at 679 n. 6. Therefore, the Anonymous case suggests that the extension phone exemption is not to be applied or rejected in a wholesale fashion, but rather the circumstances of the eavesdropping and the content of the overheard conversations must be examined to determine whether the eavesdropping constitutes a use in the ordinary course of business.

The recent cases from the Fifth and Eleventh Circuits provide more direct precedents for Abel’s wiretapping cause of action. Briggs v. American Air Filter Co., Inc., 630 F.2d 414 (5th Cir.1980); Watkins v. L.M. Berry & Co., 704 F.2d 577 (11th Cir.1983). Each of these cases examined the elements of a private wiretapping cause of action against an employer or fellow employee for alleged wrongful interception of telephone calls made and overheard on office telephones.

In the Briggs case, the Court explored the legislative history of the ordinary course of business clause and found little evidence which would clarify the intent behind the phrase. The Briggs case arose after a company supervisor listened to and tape recorded part of a conversation between an employee and his friend who worked for a competing firm. This eavesdropping occurred after the employee had been admonished not to discuss business with the friend because of suspicions regarding the disclosure of confidential information. The taped conversation was conceded to be a business conversation.

The Briggs opinion discussed one possible definition of “use in the ordinary course of business.” One obvious distinction is between eavesdropping by those persons who have authorization to have access to the phone and the same eavesdropping by one who had no business authorization to be in the office or use the phone. Ultimately, however, the Court relied on the close business relationship between the content of the telephone call and the reason behind the supervisor’s monitoring.

In the Watkins case, the intercepted telephone call was of a personal rather than business nature. The Court held that in the context of a business office, “a personal call may not be intercepted in the ordinary course of business ... except to the extent necessary to guard against unauthorized use of the telephone or to determine whether a call is personal or not.” 704 F.2d at 583.

Without deciding whether Abel will ultimately succeed on his wiretapping claim, it at least appears that his claim cannot be dismissed on summary judgment. Abel has asserted that his personal calls were intercepted without his consent or knowledge through Bonfanti’s use of a tape recorder on his office extension. While Bonfanti has proffered a business purpose for using the recorder and has claimed that he minimized his intrusions on personal calls, these rationales are sharply disputed by affidavits submitted by Abel. Therefore, a factual dispute is present as to whether Bonfanti’s recording of Abel’s telephone calls was in the ordinary course of business.

Defendant’s second ground for opposing Abel’s wiretapping charge is based on the requirement that a defendant must act “willfully” before any criminal or civil liability attaches. Citron v. Citron, 722 F.2d 14 (2d Cir.1983), cert. denied, 466 U.S. 973, 104 S.Ct. 2350, 80 L.Ed.2d 823 (1984). The Citron case establishes that the stringent definition of willfulness applies to both civil and criminal actions under Title III of the Omnibus Crime Control and Safe Streets Act of 1968. By using the term willfully, Congress intended to require “at least a voluntary, intentional violation of, and perhaps also a reckless disregard of, a known legal duty....” Citron, 72 F.2d at 16. See also United States v. Murdock, 290 U.S. 389, 394-95, 54 S.Ct. 223, 225, 78 L.Ed. 381 (1933) (“when used in a criminal statute, [willful] generally means an action done with a bad purpose; without justifiable excuse; stubbornly, obstinately, perversely. The word is also employed to characterize a thing done without ground for believing it is lawful, or conduct marked by careless disregard whether or not one has the right so to act”).

Bonfanti’s actions, when construed in a light most favorable for Abel, may establish that he intercepted taped conversations in reckless disregard of the legal duties required by the federal wiretapping laws. The facts in this case are far different from those underlying the Citron case, where the wife of the plaintiff became apprehensive about the legality of her conduct after recording a few calls and requested the advice of counsel. 722 F.2d at 15. Therefore, it would be inappropriate to dismiss Abel’s wiretapping cause of action at this stage of the proceedings on the grounds that the required standard has not been met. See Watkins, supra, 704 F.2d 577.

IV. Breach of contract

Defendants’ notice of motion has only requested summary judgment with regard to the federal law claims raised by Abel. However, they have also requested an order pursuant to Buie 12(b)(6) dismissing the complaint, and in connection therewith have submitted affidavits and arguments requesting the dismissal of Abel’s breach of contract claim. Since matters outside the pleading have been presented for the court’s consideration, it is appropriate to treat this motion to dismiss as a motion for summary judgment. See Fed.B. Civ.P. 12(b)(6). Summary judgment on Abel’s breach of contract claim will be denied because Abel has properly stated a claim as required by the case of Weiner v. McGraw-Hill, Inc., 57 N.Y.2d 458, 457 N.Y.S.2d 193, 443 N.E.2d 441 (1982). The Weiner case requires that the “totality of all ... the attendant circumstances” be examined to determine whether an employer has agreed not to terminate an employee except for cause. Id., 457 N.Y.S.2d at 198, 443 N.E.2d at 446. In this action, as in Weiner, there is sufficient evidence of a contract for Abel to maintain his cause of action. Abel claims that he submitted his resignation in February, 1984 and considered offers from other employers at that time. He states that, in reliance on defendants’ express promise not to terminate him except for cause, he withdrew his resignation. Finally, Abel supports his contract claim by evidence of FFO’s employment policies regarding termination. Each of these allegations raises factual issues which cannot be dismissed on summary judgment.

The cases cited by defendants do not compel a different conclusion. This case presents the question of an express rather than implied contract analyzed in Murphy v. American Home Products Corp., 58 N.Y.2d 293, 461 N.Y.S.2d 232, 237, 448 N.E.2d 86, 91 (1983). The case of Gicaney v. Prudential Bache Securities, Inc., N.Y.L.J., Feb. 4, 1985, at 14 (S.Ct.N.Y. Co.), which discusses the requirement that an employee rely on his employer’s promise is only relevant to Abel’s initial hiring but does not foreclose inquiry into the facts surrounding the February, 1984 withdrawal of resignation. Finally, the dictum in Leahy v. Federal Express Corp., 609 F.Supp. 668, 672 (E.D.N.Y.1985), that “even an oral representation that employees could not be fined without just cause do not satisfy the panoply of requirements set forth in Weiner” seems to be an overstatement. Such a promise is alone not enough to establish a claim, but when coupled with an employee’s reliance, it is sufficient to raise triable issues of fact.

Conclusion

For the foregoing reasons, Counts I, II and III of Abel’s complaint are hereby dismissed.

IT IS SO ORDERED.


author: WINDER, District Judge.

text:
    Donald J. FREUND, Plaintiff, v. UTAH POWER & LIGHT, a Utah corporation; and Cablemain, Inc., a Texas corporation; Jones Intercable, Inc., a Colorado corporation; Cable TV Fund VIII-B, a Colorado partnership, and John Doe 1 through John Doe 25, Inclusive, Defendants. UTAH POWER & LIGHT COMPANY, a Utah corporation, and Cablemain, Inc., a Texas corporation, Defendant and Third-Party Plaintiff, v. JONES INTERCABLE, INC., CP National Corporation, Cable TV Fund VIII-B, Konocti TV, Inc., and Alexander and Alexander, Third-Party Defendants. Argonaut Insurance Company, Plaintiff in Intervention. UTAH POWER & LIGHT COMPANY, Plaintiff, v. CP NATIONAL CORP., et al., Defendants.
    Civ. Nos. C-82-0747W, C-84-0400W.
    United States District Court, D. Utah, C.D.
    Nov. 25, 1985.

      Ralph W. Bastían, Jr., San Francisco, Cal., Jackson Howard, D. David Lambert, Provo, Utah, for Donald J. Freund.
    Stephen B. Nebeker, Anthony B. Quinn, Jeffrey D. Eisenberg, Robert Gordon, David A. Westerby, Salt Lake City, Utah, for Utah Power & Light Co.
    Scott W. Christensen, Salt Lake City, Utah, for Home Ins. Co.
    Allan L. Larson, Salt Lake City, Utah, for Cablemain, Inc.
    Glenn C. Hanni, Paul M. Belnap, Gary A. Dodge, Salt Lake City, Utah, for Jones Intercable, Cable Fund and Konocti.
    Robert A. Auné, San Francisco, Cal., for Argonaut Ins.
    Robert W. Brandt, Robert G. Gilchrist, Salt Lake City, Utah, for CP Nat.
    Donald J. Purser, Salt Lake City, Utah, for Fireman’s Fund.
    Dale J. Lambert, Salt Lake, City, Utah, for Alexander & Alexander.
   MEMORANDUM DECISION AND ORDER

WINDER, District Judge.

This matter is before the court on opposing motions for summary judgment filed by Utah Power and Light, Jones Intercable, Inc., et al, and by CP National. In addition, a motion to dismiss was filed by defendant Home Insurance Company. Oral argument was made to the court on October 18, 1985. D. David Lambert, Ralph W. Bastían, Jr. and Robert E. Aune were present on behalf of plaintiff Freund. Robert W. Brandt and Michael P. Zaccheo appeared on behalf of defendant C.P. National. Glenn C. Hanni and Mark Taylor were present representing Jones Intercable, Konocti TV, Inc. and Cable TV Fund VIII-B. Stephen B. Nebeker, Anthony B. Quinn, Jeffery Eisenberg and David Westerby appeared on behalf of Utah Power and Light. Allan L. Larson and Jerry D. Fenn appeared on behalf of Cablemain Inc., while Scott W. Christensen appeared on behalf of Home Insurance. Gary Dodge was present representing Jones Intercable and Dale Lambert appeared on behalf of Alexander and Alexander. The court took the motions under advisement and has read carefully the various memoranda filed by the parties as well as pertinent sources cited therein. Being fully advised, the court now renders the following decision and order.

Factual Background

This lawsuit arises out of an accident on October 11, 1981, in which the plaintiff, Donald R. Freund, was injured when he came in contact with an electrical power line. When injured, Freund was splicing amplifiers into cable previously hung by Cablemain on utility poles owned by Utah Power & Light. Freund was working at the time of the accident for Jones and Fund VIII-B in the construction of a cable TV system in Washington City, Utah.

Mr. Freund has brought suit against Cablemain and Utah Power & Light. Utah Power and Light, in turn, has asserted claims against Jones Intercable based upon a written agreement between the parties known as the Facilities Attachment Agreement (hereinafter referred to as “FAA”). The FAA was originally negotiated between the predecessors-in-interest of Utah Power & Light and Jones Intercable, CP National and Summit Communications, respectively. Under the terms of the FAA, the cable TV companies may attach cables to utility poles provided they agree to indemnify the utility company for injuries which result from their activities and obtain liability insurance for the utility’s benefit.

The present motions raise a number of issues. Cablemain’s motion for summary judgment involves the issue of whether Jones, Fund VIII-B and Konocti were employers of Freund within the meaning of the Utah workmen’s compensation laws and whether they may be liable to Cable-main based on the theory of implied common law indemnity. Both Utah Power & Light and CP National in their motions claim that under the terms of the FAA they are entitled to complete indemnity from Jones with respect to Fruend’s personal injury claim. Utah Power & Light, in the alternative, claims that if it is found liable, it is entitled to recover an amount up to $500,000 based on Jones’ alleged breach of the FAA agreement to provide liability insurance. Jones, in its motion, seeks a determination that it was the employer of Freund and as such is not liable to any party in the suit based on claims arising from either implied or express indemnity provisions. It maintains that workmen’s compensation is the exclusive remedy here. After reviewing the record, and listening to the arguments, the court finds that there are no genuine issues of material fact so as to preclude the granting of summary judgment pursuant to Fed.Rule Civ.Pro. 56.

Jones, Cable VIII-B and Konocti as Statutory Employers

Cablemain contends that the record reveals a factual question regarding Freund’s employer at the time of the accident. Cablemain asserts that it is possible that Freund was employed by Konocti as opposed to Jones. The contradictory testimony of Ronald Schmitt in his two depositions provides the basis for Cablemain’s argument.

The court after reviewing the record, however, finds the facts regarding Freund’s employments are clear. Jones is a Colorado corporation, qualified to do business in Utah. Fund VIII-B is a limited partnership, whose general and managing partner is Jones. Konocti is a California corporation and a subsidiary of Jones. The record shows that Jones, as part of its management style, groups all its employees together in one system under its direct control rather than having its subsidiary or limited partner hire individually. Because of this organizational style, Jones moves its experienced employees from one system to another to perform technical tasks associated with the cable TV business. Cable Fund VIII-B and Konocti have no employees but reimburse Jones for the use of its employees. In the present case, Freund worked at the Konocti location but was transferred by the Jones’ management team to St. George to install components along the newly strung Fund VIII-B system cable.

The facts reveal that Freund was employed by and controlled by Jones during the time relevant to this action. That is evidenced among other things by the payroll checks and time sheets. It is also clear that Freund was working on the Fund VIII system at the time he was injured. There is no evidence that Konocti was in any way involved in the circumstances giving rise to this law suit. In the alternative, if Konocti was involved, it was as Freund’s employer. Utah law recognizes that there may be multiple employers of an employee and all may be entitled to the workmen’s compensation defense. Bambrough v. Bethers, 552 P.2d 1286. (Utah 1976). The court finds that Jones, Fund VIII-B and Konocti are statutory employers of Freund and are therefore entitled to claim the ex-elusive remedy provisions of the workmen’s compensation law.

Implied Indemnity

Cablemain urges the court to find that an implied agreement to indemnify exists between Jones and Cablemain. Cablemain contends that Jones or Cable Fund VIII-B directed Cablemain to install the cable and assured Cablemain that various problems relating to the cables’ proximity to the powerline would be rectified promptly. Those assurances and directions form the basis for Cablemain’s implied indemnity claim.

The Utah Supreme Court has not yet ruled on whether an agreement or promise to indemnify might be implied in certain circumstances thereby avoiding the exclusive remedy provision of the Workmen’s Compensation Act. See Shell Oil Company v. Brinkerhoff Signal Drilling Company, 658 P.2d 1187, 1191 n. 3 (Utah 1983). Cablemain argues that the Tenth Circuit Court of Appeals applying Utah law in Barr v. Brezina Construction Co., 464 F.2d 1141 (10th Cir.1972) cert. denied, Brezina Construction Co. v. U.S., 409 U.S. 1125, 93 S.Ct. 937, 35 L.Ed.2d 256 (1973), suggested that an implied promise to indemnify could have been found in that case under different facts.

At this point in time, however, the Utah Supreme Court has not concluded that an implied indemnity agreement may exist in spite of the exclusiveness of Workmen’s Compensation. Until the State court rules conclusively on this issue, this court will not second guess its conclusion. Cf. Bertoch v. Marriott Corporation, No. C826029 (Dist.Ct., Utah, March 13, 1984). Moreover, the Utah court has considered and rejected any constitutional challenge to the exclusive remedy provision. Morrill v. J & M Construction Co., 635 P.2d 88 (Utah 1981). Cablemain’s motion for summary judgment on the issue of common law indemnity is therefore denied.

The Facilities Attachment Agreement

CP National, Utah Power & Light and Cablemain claim Jones, Fund VIII-B, and Konocti breached the terms of the Facilities Attachment Agreement (hereinafter referred to as “FAA”). They premise their claims on the assertion that the Jones companies (“Jones”) assumed the FAA obligations of Summit Communications to CP National and its assignee, Utah Power & Light. Jones has asserted that it did not assume the obligations of the FAA when it entered into the Purchase and Sale Agreement with Summit Communications.

For purposes of this motion only and in order to decide the legal significance of various controverted portions of the FAA, the court will ignore the factual issue and will assume that the FAA is enforceable between Utah Power & Light and Jones.

Indemnification for Utah Power & Light’s Own Negligence

Assuming that Jones and Fund VIII-B have undertaken the obligations of the FAA, the court must determine first, whether those obligations require Jones to indemnify Utah Power & Light for Utah Power & Light’s negligence. Second, the court must determine whether the FAA would require Jones to reimburse Utah Power & Light based on Jones’ alleged failure to provide Utah Power & Light with liability insurance.

As mentioned previously, the FAA governed use of CP National’s utility poles by Summit Communications. Paragraphs 20 and 21 are indemnity provisions whose legal significance is in dispute. Those paragraphs state:

20. The Licensee shall indemnify, protect, and save harmless the Licensor from any cause of action, claim, or other legal proceeding by the Licensee’s subscribers or other third persons against the Licensor in the event the continued use of poles owned by the Licensor is denied to Licensee for any reason. In addition the Licensee shall, upon demand and at its own risk and expense, defend any and all such actions, claims, or other legal proceedings.
21. Licensee shall indemnify, protect, and save harmless Licensor from and against any and all claims, demands, causes of action, costs or other liabilities for damages to property and injury or death to persons which may arise out of or be connected with the erection, maintenance, presence, use or removal of Licensee’s equipment, or of structures, guys and anchors, used, installed or placed for the principal purpose of supporting Licensee’s equipment or by any act of Licensee on or in the vicinity of Licensor’s poles, including, but not by way of limitation, payments made under workmen’s compensation laws. Except for intentional wrongdoing or willful negligence on the part of Licensor, or any of its agents or employees, Licensee shall also indemnify protect and save harmless Licensor from and against any and all claims, demands, causes of action, costs, or other liabilities arising from any interruption, discontinuance or interference with Licensee’s service which may be occasioned or which may be claimed to have been occasioned by any action of Licensor pursuant to or consistent with this agreement. In addition, Licensee shall, upon demand and at its own sole risk and expense, defend any and all suits, actions or other legal proceedings which may be brought or instituted by third persons against Licensor or their successors or assigns on any such claim, demand or cause of action; shall pay and satisfy any said suit, action or other legal proceeding; and shall reimburse Licensor for any and all reasonable legal expenses incurred by Licensor in connection herewith.
This indemnification agreement by Licensee in favor of Licensor, shall provide Licensor with full and complete indemnification, including defense of any suits, actions or other legal proceedings resulting from any claims for damages to property and injury or death to persons and shall apply to all claims, demands, suits, and judgments of whatever nature which shall be made or assessed against Li-censor in furnishing such poles under the terms of this agreement or for any other thing done or omitted in conjunction with Licensor’s dealings with Licensee. (Emphasis added).

The first sentence of paragraph 21, underlined above, covers the present factual situation. Jones argues that the sentence does not contain the kind of explicit language required by Utah law in order to hold an indemnitor accountable for an indemnitee’s own negligence. Utah Power & Light, on the other hand, asserts that the first sentence must be read in conjunction with the following sentence. The first sentence is all inclusive, in contrast to the second which expressly excludes indemnification for the licensor’s wrongdoing. According to Utah Power & Light, the parties’ intention is clear: the utility company is to be indemnified under any and all situations which arise out of or are connected with “the erection, maintenance, presence, use, or removal” of Jones’ equipment and the indemnitor is to indemnify the indemnitee regardless of who is at fault. Utah Power & Light further argues that Utah law does not require “buzz words” in order to require an indemnitor to indemnify the indemnitee for the latter’s negligent acts.

The Utah Supreme Court has applied a strict interpretation standard when interpreting indemnity provisions similar to the one now before the court. The Court set forth the standard in clear terms in the case of Union Pacific Railroad Co. v. El Paso Natural Gas Co., 17 Utah 2d 255, 408 P.2d 910 (1965). The Court there was called upon to interpret an indemnity contract given by a gas company seeking the use of the railroads’ easements for a pipeline. Although some of the factors influencing the court’s deliberations in that case are not present here, the general tenor of the court’s decision and its guidelines for interpreting indemnity contracts are important. The court’s conclusion favoring the gas company rested in large measure on the proposition that “the law does not look with favor upon one exacting a covenant to relieve himself of the basic duty which the law imposes on everyone: that of using due care for the safety of himself and others.” Union Pacific R.R. v. El Paso, 408 P.2d at 913. The court then stated its understanding of the majority rule regarding the interpretation of covenants purporting to indemnify the indemnitee for its negligence:

The majority rule appears to be that in most situations, where such is the desire of the parties, and it is clearly understood and expressed, such a covenant will be upheld. But the presumption is against any such intention, and it is not achieved by inference or implication from general language such as employed here. It will be regarded as a binding contractual obligation only when that intention is clearly and unequivocally expressed.

408 P.2d at 914.

The Utah Supreme Court has continued to cite to its language in El Paso, quoted above, when interpreting indemnity contracts. See, e.g. Shell Oil v. Brinkerhoff, 658 P.2d 1187, (1983); Union Pacific Railroad Co. v. Intermountain Farmer’s Association, 568 P.2d 724, 725 (Utah 1977). Federal court decisions applying Utah law have stressed that the parties’ intention must be “clearly and unequivocally expressed.” Titan Steel Corp. v. Walton, 365 F.2d 542 (10th Cir.1966), Southern Pacific Transportation v. Nielsen, 448 F.2d 121, 123 (10th Cir.1971).

The question before the court, then is whether the indemnity provisions of the FAA express “clearly and unequivocally” the intention to indemnify Utah Power & Light from losses attributable to its own negligence. The court’s interpretation must be guided by the presumption against such intention and the understanding that indemnity agreements are strictly construed against the indemnitee. Union Pacific Railroad v. El Paso Natural Gas, 17 Utah 2d 255, 408 P.2d 910 (1965), Shell Oil Co. v. Brinkerhoff, 658 P.2d at 1189.

Jones has directed the court’s attention to only three situations where courts, applying Utah law, have concluded that the language of the contract requires an indemnitor to cover for losses caused by the indemnitee’s own negligence. Those cases are: Shell Oil v. Brinkerhoff, 658 P.2d 1187 (Utah 1983); Titan Steel Corp. v. Walton, 365 F.2d 542 (10th Cir.1966); Southern Pacific Transportation v. Nielsen, 448 F.2d 121 (10th Cir.1971).

An examination of the indemnity provision in each of the above cases reveals that each provision expressly states the scope of the agreed upon indemnity. Each makes explicit reference to the indemnitor’s obligation to indemnify the indemnitee except in situations where the injury has resulted from the sole negligence of the indemnitee. Each agreement discusses the effect of the indemnitee’s negligence.

The relevant language of the FAA, however, does not contain similarly explicit language. The first sentence of paragraph 21 provides in general language for the licensee to indemnify the- licensor for liability arising out of “the erection, maintenance, presence, use, or removal of licensee’s equipment____” Although the cause of Mr. Freund’s injuries comes clearly within the scope of this provision, the sentence makes no reference to the intention of the parties regarding whether the licensor would be indemnified for its own negligence. Under Utah law, the language is not sufficiently explicit. Moreover, the second sentence of paragraph 21, the construction of which Utah Power & Light relies on to interpret the first sentence, covers claims relating to the interruption of the licensor’s service. It does not relate to personal injury claims. Its usefulness as an aid in construing the intention of the first sentence is thereby limited.

The Utah court has made it plain that unless the contract clearly and unequivocally deals with the indemnitee’s negligence, the indemnitee will not be indemnified against its own negligence. This court reiterates the words of the Utah court in Union Pacific Railroad Company v. El Paso Natural Gas, 17 Utah 2d 255, 408 P.2d 910 (1965) in this regard:

If it had been the intent of the parties that the defendant should indemnify the plaintiff even against the latter’s negligent acts, it would have been easy enough to use that very language and to thus make that intent clear and unmistakable, which was not done here. Id., 408 P.2d pp. 913-914.

Nor is the language of the FAA sufficiently clear for this court to conclude that the parties intended that Jones contracted away its workmen’s compensation defense. The Utah Supreme Court in Shell Oil v. Brinkerhoff, 658 P.2d 1187 (1983), held that the exclusive remedy provision of the Workmen’s Compensation Act, Utah Code Ann. § 35-1-60, did not necessarily invalidate an agreement under which the employer agreed to indemnify a third-party for amounts paid to its employees. Id. at 1191. The court’s holding in Shell Oil was based on an analysis of a contract that stated expressly that the indemnitor would indemnify the indemnitee even for injuries caused to employees of the indemnitor. The contract in Shell Oil provided that the contractor would indemnify the operator from and against:

... all claims, demands and causes of action of every kind and character arising in favor of Contractor’s employees, Operators employees or third parties on account of bodily injuries, death or damage to property arising out of or in connection with the performance of this agreement ... Id. at 1189 n. 1.

Similarly, two other decisions applying Utah law have found the language of the indemnity agreement in question sufficient to overcome the workman’s compensation defense because the agreement specifically mentioned indemnification for injury to the indemnitor’s employees. See Titan Steel Corporation v. Walton, 365 F.2d 542 (10th Cir.1966); Oregon Shortline Railroad Company v. Idaho Stockyards Co., 364 P.2d 826 (Utah 1961).

The requirement that an agreement state in express terms that an employer intends to indemnify third-parties for employee injuries serves an important public policy. The Workmen’s Compensation laws provide employees with expedited compensation for the loss of earning capacity in exchange for the relinquishment of their common law causes of action against the employer. The employer, in turn, gives up legal defenses and must pay into a compensation fund in return for freedom from employee suits. Any change in this arrangement should not be lightly inferred. Accordingly, an employer’s intention to waive its immunity must be clearly expressed in the agreement.

The language of the FAA does not clearly express an intention to contract away the employer’s (Jones) workman’s compensation immunity. There is no reference to Jones’ obligation to indemnify Utah Power & Light for injuries caused to Jones’ employees. The FAA is neither clear enough to overcome the presumption against an indemnitee contracting away liability for his own negligence nor to overcome the presumption against contracting away one’s employer immunity under Workmen’s Compensation.

Breach of Contract to Provide Liability Insurance

Finally, Utah Power & Light contends that Jones must reimburse it for all losses it might incur because Jones breached its contract to provide liability insurance for the licensor’s (UP & L) benefit. Utah Power’s contention is based on its interpretation of paragraph 22 of the FAA. That paragraph contains the following covenants respecting the licensee’s duty to insure for the licensor’s benefit.

Throughout the life of this agreement, Licensee shall, in addition to and consistent with the provisions of Paragraph 21, maintain in full force and effect with the carrier or carriers selected by Licensee and satisfactory to the Licensor: (1) Compensation insurance in compliance with all workmen’s compensation insurance and safety laws of the State of Utah and amendments thereto; and (b) Bodily injury insurance with limits of $500,000 for each person and $1,000,000 for each occurrence; and (c) Property damage liability insurance with limits of $250,000 for each accident and $300,000 aggregate.
The insurance described in (b) and (c) above shall also provide contractual liability coverage satisfactory to Li-censor with respect to all liabilities assumed by Licensee under the provisions of this agreement. Policies of insurance obtained in compliance with the requirements of this paragraph 22 shall name Licensor as an additional insured, and shall be sufficient to satisfy the indemnification provisions of Paragraph 21 and protect Licensor against any and all claims for personal injury, death, or property damage arising out of or resulting from this agreement. Licensee shall furnish to Licensor copies of all policies of insurance obtained in compliance with this agreement prior to the installation of any of Licensee’s equipment upon said poles and prior to the expiration of each policy year thereafter. In addition, the Licensee shall submit to Licensor certificates by each company insuring Licensee to the effect that it has insured Licensee under this agreement and that it will not cancel or change any policy of insurance issued to Licensee except after thirty (30) days notice to Licensor. (Emphasis added).

Utah Power & Light argues that the underlined clauses indicate that the parties to the FAA intended that the licensee’s obligation to insure was not limited to those obligations that arise under paragraph 21’s indemnity provisions. Rather, Utah Power & Light is to be insured against “any and all claims arising out of or resulting from this agreement” including those not covered by the indemnity provisions. In other words, Utah Power & Light contends that the insurance provisions should be construed so as to provide coverage for its own acts of negligence.

Utah law in this regard is clear. A requirement to provide insurance is governed by the same rule of construction as an indemnification provision which seeks indemnification for the indemnitee’s own negligence. Kennecott Copper Corp. v. General Motors Corp, 730 F.2d 1380 (10th Cir.1984). The intention of the parties regarding insurance coverage must be clearly and unequivocally expressed when the action on the insurance agreement sounds as an action for indemnification. Id. at 1382, citing Union Pacific Railroad v. Intermountain Farmers Ass’n., 568 P.2d 724, 726 (Utah 1977). If the actual effect of the insurance agreement is to indemnify, then the rules governing indemnification must be applied. The court in Kennecott Copper states clearly that there is no difference between an agreement to purchase insurance to cover the lessor’s own acts and an indemnification agreement. 730 F.2d at 1382. In either case, the presumption against insuring oneself against one’s own acts will govern.

When those standards are applied to the FAA agreement, it is clear that the insurance provisions of paragraph 22 can not be construed as providing coverage beyond that contemplated for indemnification under paragraph 21. The provisions do not state explicitly that the insurance to be provided should be such as to cover the lessor’s own negligent acts.

In summary, this court finds that Jones, Konocti and Cable TV Fund VIII-B are the employers of Freund, Bond, and Schmitt within the meaning of the Workmen’s Compensation statutes of Utah. Under Utah law, Cablemain is not entitled to assert a common law indemnity claim against Jones. The Facilities Attachment Agreement, when examined by the exacting standards of Utah law, does not require Jones to indemnify Utah Power & Light (or any other potential party to the FAA) for its own negligence nor does it indicate a waiver of Jones’ workmen’s compensation defense. Finally, the FAA provisions governing the acquisition of insurance by Jones on behalf of Utah Power & Light do not require that Jones provide insurance for Utah Power & Light’s own acts.

Accordingly,

IT IS HEREBY ORDERED that:

1. Cablemain’s motion for summary judgment is denied;

2. Utah Power & Light’s motion for summary judgment is denied; and

3. Jones Intercable, et al's motion for summary judgment is granted.

      . Because of the undisputed evidence regarding the organizational relationship between Jones, Fund VIII-B, and Konocti, and the manner in which employees were managed by Jones, the court concludes that Jones was also the employer of Bond and Schmitt.

      . The indemnity provision of the contract in Shell Oil Co. v. Brinkerhoff, 658 P.2d 1187 (Utah 1983) states in relevant portion:
      ... Contractor [Brinkerhoff] agrees to protect, indemnify and save Operator [Shell], its employees, and agents harmless from and against all claims, demands and causes of action of every kind and character arising in favor of Contractor's employees, Operator’s employees or third parties on account of bodily injuries, death or damage to property arising out of or in connection with the performance of this agreement, except where such injury, death or damage has resulted from the sole negligence of Operator, without negligence wilfull act on the part of the Contractor, its agents, servants, employees, or subcontractors. Id. at 1189 (Emphasis added).
      The factual situation presented in Shell Oil was similar to the one before the court. It also involved a controversy over an indemnity agreement between an employer covered by workmen’s compensation and a third party who was being sued by the employee.
      The pertinent language from the agreement at issue in Southern Pacific Transportation Co. v. Nielsen, 448 F.2d 121 (10th Cir.1971) states:
      Buyer ... agrees to indemnify and save harmless Railroad ... from and against ... all liability ... regardless of any negligence or alleged negligence on the part of any Railroad employee or agent. Id. at 124. (Emphasis added).
      The court in Titan Steel Corporation v. Walton, 365 F.2d 542 (1966) decided that the intention of the parties was revealed through two contracts. The court did not distinguish between the language of the two in its discussion. One contract stated:
      ... Contractor agrees to indemnify and hold Owner harmless from liability for all losses, ... which may arise out of, or in connection with, the performance of the Contract and which are caused by any act, or omission, of Contractor or subcontractors____ Id. at 548.
      Utah Power & Light points out that the above agreement does not explicitly delineate the scope of the indemnity obligations when the injury is caused by the Owner’s negligence. The other contract however, which the Court in Titan considered in tandem with the first, does use more explicit language. It states:
      The subcontractor agrees to indemnify, ... the Contractor and Owner against all claims ... except when caused by the sole negligence of the Contractor or Owner.

      . In Titan Steel v. Walton, 365 F.2d 542 (10th Cir.1966), the contract included a provision requiring the contractors to indemnify:
      for any and all claims arising from injury to employees of Contractor, or injury to any subcontractor or employees of such subcontractor arising from the performance of the Contract, and for any injury to employees of owner, or to third persons, or to the public, or to their property, caused by any act, or omission of Contractor or subcontractors ... Id. at 547-48.
      In Oregon Shortline Railroad Company v. Idaho Stockyard Company, 12 Utah 2d 205, 364 P.2d 826 (1961), the contract provided that the contractor would indemnify the railroad against all:
      ... claims, demands, losses, costs and expenses of whatsoever nature which may arise by reason of injury to or death of any of the representatives or employees of the Contractor, or by reason of damage to or loss of any property of the Contractor, or of his agents or employees, or of others when in the custody or control of the Contractor ... Id. 364 P.2d at 827.