author: STAKER, District Judge.

text:
    Fred O. NORRIS, Plaintiff, v. ACF INDUSTRIES, INCORPORATED, a corporation, Defendant.
    Civ. A. No. 83-3142.
    United States District Court, S.D. West Virginia, at Huntington.
    March 12, 1985.
    On Motion to Reconsider April 23, 1985.

      Charles M. Kincaid, Huntington, W. Va., George Howell, Ashland, Ky., for plaintiff.
    John S. Haight, Charleston, W. Va., for defendant.
   MEMORANDUM OPINION AND ORDER

STAKER, District Judge.

This action has been brought by the plaintiff to recover for injuries allegedly caused by the defendant’s wilful, wanton, reckless, and malicious intent. Mandolidis v. Elkins Industries, Inc., 161 W.Va. 695, 246 S.E.2d 907 (1978). Plaintiff has moved to strike the defenses of contributory negligence, assumption of the risk, and injury by fellow servant asserted by the defendant in its answer. He contends that these defenses are inapplicable to a Mandolidis action as a matter of law. Defendant has conceded that the defense of comparative-contributory negligence is inapplicable. Because the issues involved herein are purely questions of law the court will not relate the facts alleged in the complaint which give rise to this action.

Inasmuch as this court has jurisdiction over this action solely because of the diversity of citizenship of the parties, 28 U.S.C. § 1332(a)(1), we must apply the law of the state wherein we sit. Erie Railroad v. Tompkins, 304 U.S. 64, 58 S.Ct. 817, 82 L.Ed. 1188 (1938). The West Virginia Supreme Court of Appeals held in Mandolidis, supra, that “an employer loses [its workmen’s compensation] immunity from common law actions [under W.Va.Code § 23-4-2 (1981 Replacement Vol.)] where such employer’s conduct constitutes an intentional tort or wilful, wanton, and reckless misconduct.” 246 S.E.2d at 914 (footnote omitted) (citations omitted). The portion of that statute relied upon by the Supreme Court of Appeals states that:

If injury or death result to any employee from the deliberate intention of his employer to produce such injury or death, the employee, the widow, widower, child or dependent of the employee shall have the privilege to take under this chapter, and shall also have cause of action against the employer, as if this chapter had not been enacted, for any excess of damages over the amount received or receivable under this chapter.

W.Va.Code § 23-4-2 (1981 Cum.Supp.). It has been interpreted as not creating a new cause of action but as preserving the common law cause of action against an employer as though the immunity therefrom for employers covered by the Workmen’s Compensation Fund, W.Va.Code § 23-2-6 (1981 Replacement Vol.), did not exist. Parsons v. Shoney’s, Inc., 580 F.Supp. 129, 131 (S.D.W.Va.1983). The issue before this court is whether or not the common law defenses of assumption of the risk and injury by a fellow servant are also preserved. The West Virginia Supreme Court of Appeals has not decided these questions and, therefore, it is the task of this court to predict how that court would rule if these issues were presented to it.

It is a general rule of law that an employee may not recover damages from his employer for an injury caused by the negligence of a fellow employee. 12B Michie’s Jurisprudence Master and Servant § 65 (1978). However, if the injury is caused by concurrent acts of negligence by the employer and the fellow employee then the employer may be held liable. Simpson v. Carter Coal Co., 79 W.Va. 365, 91 S.E. 1085 (1917); Reilly v. Nicoll, 72 W.Va. 189, 77 S.E. 897 (1913). In Mandolidis, supra, the West Virginia Supreme Court of Appeals allowed the employer’s workmen’s compensation statutory immunity to be overcome only upon a showing of “an intentional tort or wilful, wanton, and reckless misconduct” which the court explained was a higher form of misconduct than negligence. 161 W.Va. at 703-04, 246 S.E.2d at 913-14. This was because the court felt that an employer should not be able to conduct itself with impunity no matter how egregious its conduct. Id. at 913. This court believes that if the West Virginia Supreme Court of Appeals would not allow an employer to avoid liability under the “fellow servant” doctrine if it were guilty of simple negligence, Simpson, supra; Reilly, supra, it would certainly not allow that doctrine to serve as an escape for an employer who is directly guilty of “an intentional tort or wilful, wanton, and reckless misconduct.” Therefore, we hold that the defense of injury by a fellow servant is inapplicable in a Mandolidis action.

The harder question is whether the defense of assumption of the risk has any place in this type of action. Can an employee assume the risk that his employer will inflict an injury on him with deliberate intention to do so, as that term is defined in Mandolidis, supra ?

The doctrine of assumed or incurred risk is based upon the existence of a factual situation in which the act of the defendant alone creates the danger and causes the injury and the plaintiff voluntarily exposes himself to the danger with full knowledge and appreciation of its existence. In 65A C.J.S. Negligence § 174(4), with reference to the doctrine of the assumption of risk, the text contains these statements. “In its simplest and primary sense, it means that plaintiff had consented to relieve defendant of an obligation of conduct toward him, and to take his chance of injury from a known risk. By entering freely and voluntarily into any relation or situation which presents obvious danger, plaintiff may be taken to accept it, and to agree that he will look out for himself, and relieve defendant of responsibility. The result is that defendant is simply under no legal duty to protect plaintiff. In other words, it is in the nature of a waiver and may be subject to rules relating to waiver.” It has been said that the doctrine applies when a person brings about a condition or situation obviously dangerous to himself by voluntarily exposing himself to a hazard created by another. See Matthews v. Cumberland and Allegheny Gas Company, 138 W.Va. 639, 77 S.E.2d 180; Hunn v. Windsor Hotel Company, 119 W.Va. 215, 193 S.E. 57; 13 M.J., Negligence, Section 43.

Hollen v. Linger, 151 W.Va. 255, 151 S.E.2d 330, 335 (1966); accord, Davis v. Fire Creek Fuel Co., 144 W.Va. 537, 109 S.E.2d 144, 151-52 (1959). It “is available as a defense only where one places himself in a posture of known danger with an appreciation of such danger____ It involves the taking of a risk without regard to the care taken after he is in danger.” Korzun v. Shahan, 151 W.Va. 243, 151 S.E.2d 287, 292 (1966) (citation omitted).

The doctrine is one of the main defenses relied upon by an employer when sued at common law by an employee for injuries suffered in the course of his employment. The rule in West Virginia is that:

“When an employee is not placed by his employer in a position of undisclosed danger, but is a mature man, doing the ordinary work which he has been engaged to do and the risks of which are obvious to any one, he assumes the risk of the employment, and no negligence can be imputed to the employer for an accident to him therefrom. In the relation between master and servant, the prinicple of waiver has wide scope and operation. In the abstract, the master is under an absolute duty to furnish the servant a reasonably safe place in which to work and reasonably safe appliances with which to work, but the servant, having knowledge of the failure in these respects, is deemed to have waived performance or rather to have assented to the conditions the master has made.

Davis, 144 W.Va. at 546, 109 S.E.2d at 151. Based upon these decisions, it might appear that assumption of the risk is a valid defense in the case at bar since the common law governs. Parsons, supra.

However, assumption of the risk is not avaliable as a defense when the defendant is charged with wilful and wanton misconduct. Stone v. Rudolph, 127 W.Va. 335, 32 S.E.2d 742, syl. pt. 6 (1945). Stone’s definition of wilful, wanton, and reckless misconduct was heavily relied upon by the Supreme Court of Appeals in Mandolidis in defining what the phrase “deliberate intent to produce such injury or death” in § 23-4-2 meant. 161 W.Va. at 703-04, 246 S.E.2d at 913-14. In fact, a showing of wilful, wanton, or reckless misconduct on the part of the employer is one of the two ways of establishing deliberate intent. 161 W.Va. at 705, 246 S.E.2d at 914. Because Stone was so vital to the decision in Mandolidis, this court believes that the West Virginia Supreme Court of Appeals would also adopt its rule denying the applicability of the assumption of the risk defense for Mandolidis actions. Cf. Santiago v. Clark, 444 F.Supp. 1077, 1079 (N.D.W.Va.1978) (assumption of risk would not be a defense where there is specific intent to injure or cause an accident).

The only argument that this court can see in favor of allowing the defense of assumption of the risk in a Mandolidis action is by analogy from Peneschi v. National Steel Corp., 295 S.E.2d 1 (W.Va. 1982). In Peneschi, the Supreme Court of Appeals, relying upon Restatement (Second) of Torts § 526 (1976), held that an employee employed to work in an abnormally dangerous activity assumes the risk of being injured while engaged in that activity. 295 S.E.2d at 12. The argument could be made that because the court followed the Restatement in allowing the assumption of the risk defense in Peneschi it would also follow the Restatement in regard to the applicability of that defense in a Mandolidis action because of the court’s reliance on § 500 of the Restatement (Second) of Torts “Reckless Disregard of Safety” (1965), which sanctions the application of that defense, in reaching its decision in Mandolidis. First of all, it should be noted that the Supreme Court of Appeals mainly relied on its own prior decisions in reaching its decision in Mandolidis, supra. Section 500 was used as authority to support its case law. The principal argument against invoking § 503(4)’s assumption of the risk of reckless misconduct is that the Restatement itself states that the defense is inapplicable to the employer/employee relationship because of the disparity in the economic and bargaining powers of the parties. Restatement (Second) of Torts § 496B, Comment / and § 496C, Comment j (1965). This court believes the West Virginia court, if faced with this argument, would adopt the Restatement’s employer/employee exception. We base our prediction on that court’s statements in Mandolidis with regard to not allowing a person to escape liability for actions likely to result in injury. 161 W.Va. at 704, 246 S.E.2d at 913. Further support for our position is found in the Supreme Court of Appeals’ discussion of the facts of the lead case in Mandolidis wherein the plaintiff was clearly aware of' the danger to him created by his employer’s conduct and yet proceeded to encounter the risk. Id. at 915; accord, Cline v. Joy Mfg. Co., 310 S.E.2d 835, 840 n. 8 (W.Va.1983). Although this appears to be a perfect example of assumption of the risk, Hollen v. Linger, supra; Davis v. Fire Creek Fuel Co., supra; Restatement (Second) of Torts § 496A-496E (1965), the court did not even mention the possible application of that defense. Mandolidis, 161 W.Va. at 705-09, 246 S.E.2d at 914-16; accord, Cline, 310 S.E.2d at 840 n. 8. Therefore, this court declines to adopt this line of argument. As a result, we hold that the defense of assumption of the risk is inapplicable, as a matter of law, in an action brought pursuant to Mandolidis v. Elkins Industries, Inc., 161 W.Va. 695, 246 S.E.2d 907 (1978).

For the reasons stated above in this memorandúm opinion, it is hereby ORDERED that plaintiffs motions to strike the defenses of contributory negligence, assumption of the risk, and injury by fellow servant be, and the same hereby are, SUSTAINED and GRANTED.

ON MOTION TO RECONSIDER

Defendant has asked the court to reconsider our decision striking the doctrine of assumption of the risk as a defense in this Mandolidis action. It bases this motion on the Fourth Circuit Court of Appeals’ recent decision in Haverty v. Norris Industries, Inc., 758 F.2d 647 (1985), in which that court upheld the district court’s instruction to the jury that the plaintiff would be barred from recovery if he, as well as the defendant, were guilty of wanton, wilful, and reckless misconduct which proximately caused his injuries. Defendant argues that, since both the doctrines of assumption of the risk and wanton, wilful, and reckless misconduct have as an essential element knowledge of the risk of injury and since the Fourth Circuit has held that wanton, wilful, and reckless misconduct is chargeable against a plaintiff, this court should reverse our prior decision and allow assumption of the risk to likewise be chargeable against a plaintiff. Alternatively, defendant asks the court to hold that if a plaintiff encounters a danger fully appreciating the risk of injury to himself created thereby, this would be reckless misconduct. Thus, assumption of the risk would be a form of wanton, wilful, and reckless misconduct and evidence thereof would be admissable at trial and chargeable against the plaintiff under the latter doctrine.

Assumption of the risk arises as a defense to a negligence, action when “the act of the defendant alone creates the danger and causes the injury and the plaintiff voluntarily exposes himself to the danger with full knowledge and appreciation of its existence.” Hollen v. Linger, 151 W.Va. 255, 151 S.E.2d 330, 335 (1966); accord, Powell v. United States Steel Corp., 305 F.Supp. 645, 649 (S.D.W.Va.1969). The nature and extent of the risk must be fully appreciated and then the plaintiff must voluntarily expose himself to the risk or danger. Cross v. Noland, 156 W.Va. 1, 190 S.E.2d 18, 22 (1972). What must be remembered is that the risk or danger of injury is brought about by the actions of the defendant. Plaintiff’s fault lies in exposing himself to the danger. By this action, the plaintiff relieves the defendant of any responsibility for his wrongful conduct. Hollen v. Linger, supra.

Wilful, wanton and reckless conduct arises when a person “conscious of his conduct, and conscious, from his knowledge of existing conditions, that injury [will] likely or probably result from his conduct, and ... with reckless indifference to [the] consequences ... consciously and intentionally [does] some wrongful act or [omits] some known duty which [produces] the injurious result.” Stone v. Rudolph, 127 W.Va. 335, 32 S.E.2d 742, 749-50 (1945) ((citation omitted). The person who engages in such misconduct can not be relieved of responsibility therefor by the contributory negligence of or the assumption of the risk by the aggrieved party. Id., 127 W.Va. at 347, 32 S.E.2d at 749.

The court believes that these two doctrines are substantially different: assumption of the risk involves knowledge of a risk of injury to oneself created by the wrongful conduct of another while wilful, wanton and reckless misconduct involves knowledge of risk of injury to another created by one’s own conduct. See, Mandolidis v. Elkins Industries, Inc., 161 W.Va. 695, 246 S.E.2d 907, 914 (1978). The court holds, therefore, that, in a Mandolidis action, encountering a danger created by the misconduct of another with knowledge of a risk of injury to oneself created thereby is not wilful, wanton and reckless misconduct as defendant contends in its alternative argument in support of its motion.

Nor is the court convinced that the decision in Haverty, supra, requires us to reverse our prior decision striking the defense of assumption of the risk. In Haverty, the plaintiff consciously engaged in misuse of the machine involved with knowledge of the risk of injury to himself created thereby. It was his own conduct which was wilful, wanton and reckless because he did a wrongful act with reckless indifference to the consequences to himself. This court’s previous holding was that a plaintiff does not assume the risk of his employer’s wilful, wanton and reckless misconduct as those terms are applied in a Mandolidis action. We are not persuaded that that decision was erroneous. Therefore, defendant’s motion for reconsideration is denied.

The defendant has also moved for permission to amend its answer to include the defense of plaintiff’s wilful, wanton and reckless misconduct should its motion for reconsideration be denied. Fed.R.Civ.P. 15(a). The decision in Haverty v. Norris Industries, Inc., supra, announced a new defense to a Mandolidis action and this court believes that justice requires that defendant be allowed the opportunity to plead and to prove this defense. The motion to amend the answer, therefore, will be granted.

For the reasons stated above in this memorandum opinion, it is hereby ORDERED that defendant’s motion for reconsideration be, and the same hereby is, OVERRULED and DENIED. It is hereby ORDERED that defendant’s motion for leave to file an amended answer be, and the same hereby is, SUSTAINED and GRANTED. Defendant shall, within seven days of the date of entry of this order, file with this court and serve upon the plaintiff its amended answer.

      . Section 23-4-2 was substantially amended by the West Virginia Legislature in 1983 in response to the Mandolidis decision. W.Va.Code § 23-4-2 (1984 Cum.Supp.). However, because plaintiffs cause of action accrued before the date of the amendment this action is not affected or governed by the amendment. W.Va.Code § 23-4-2(d) (1984 Cum.Supp.).

        . Section 503, Restatement (Second) of Torts (1965), "Plaintiffs Conduct”, states: “(4) A plaintiff who assumes the risk arising from the defendant's reckless disregard of his safety is barred from recovery for such harm.” The Reporter’s Comment d on this subsection refers to § 496A for determining assumption of the risk. Id.


source: Caselaw Access Project

author: ASPEN, District Judge:

license: Public Domain

text:
    ROTHERY STORAGE AND VAN COMPANY, Major Van Line, Inc., and Carver Mallory, Plaintiffs, v. ATLAS VAN LINES, INC., Defendant.
    No. 84 C 8687.
    United States District Court, N.D. Illinois, E.D.
    March 12, 1985.

      Thomas L. Trinley, Robert F. Briskman, Patrick Lamb, Goldstein, Simon, Briskman, Briskman, Trinley, Lamb, Chicago, Ill., for plaintiffs.
    Theodore R. Tetzlaff, Jenner & Block, Chicago, Ill., for defendant.
   MEMORANDUM ORDER

ASPEN, District Judge:

Defendant’s motion to dismiss is granted.

Plaintiffs allege that the Court has jurisdiction over this case under 28 U.S.C. § 1332. Section 1332 authorizes civil suits in federal courts when there exists complete diversity between the opposing parties and the matter in controversy exceeds $10,000, exclusive of interest and costs. In a case such as this one, where the plaintiffs seek only declaratory and other non-monetary relief, the plaintiffs must present “substantial proof” of “facts justifying the conclusion that the action involves ‘value’ in the necessary amount.” Breault v. Feigenholtz, 380 F.2d 90, 92 (7th Cir.), cert, denied, 389 U.S. 1014, 88 S.Ct. 591, 19 L.Ed.2d 660 (1967). The existence of such “value” is to be measured by that which the plaintiffs seek to gain by their action— the pecuniary consequence to them. Id.

Plaintiffs have not provided proof that each of their claims involves a value greater than $10,000. The only reference in the complaint to the dollar value of the stock at issue is the redemption price of $105 per share; thus, each plaintiff’s stock is alleged to have been worth (at least at some time in the past) $3,150. However, redemption of their stock is not what plaintiffs seek in this suit. To the contrary, the complaint requests a declaration that defendant’s attempts to redeem the stock were illegal. Plaintiffs also seek a declaration that their stock is still extant or, in the alternative, that it is equivalent to some number of shares of an existing class of defendant’s stock. Although the complaint alleges that defendant has converted old classes of stock into a new class of common stock and has declared various stock splits and dividends on the stock, it fails to provide any facts demonstrating that the value of each plaintiff’s stock exceeds $10,000. Thus, the complaint must be dismissed.

Plaintiffs have tried to bolster their jurisdictional amount allegations through their response to defendant’s motion to dismiss and an affidavit. Even if the additional facts alleged in the response and affidavit are incorporated into the complaint, however, plaintiffs still have failed to prove substantially that the amount in controversy is more than $10,000. Most importantly, the footnote in the June 17, 1980 Offering Circular simply does not support the plaintiffs’ claim that defendant declared that shares of Class AB stock could be exchanged for shares of the new common stock.

The complaint will be dismissed without prejudice in case plaintiffs can somehow show other facts supporting their general claim that the matter in controversy exceeds $10,000. However, plaintiffs will not be permitted to include a count seeking an equitable bill of discovery. Although this discovery device may “have been long known in the law,” as plaintiffs claim, it was superseded decades ago by the adoption of the Federal Rules of Civil Procedure. See 4 J. Moore, J. Lucas & G. Grotheer, Jr., Moore’s Federal Practice ¶¶26.03[1] and [3]. Moreover, even a bill of discovery would not permit a party to engage in the type of “fishing expedition” sought by plaintiffs. Although plaintiffs properly are reluctant to make allegations without knowledge of their truth, the Federal Rules of Civil Procedure do allow allegations based on information and belief as well as general averments of an adversary’s state of mind. See, e.g., Tankersley v. Albright, 514 F.2d 956, 964-65 n. 16 (7th Cir.1975); Fed.R.Civ.P. 9(b). Thus, rather than seeking a bill of discovery, plaintiffs should file a complaint containing any claim they can state in good faith and then proceed with discovery as provided in the Federal Rules.

Accordingly, defendant’s motion to dismiss is granted. It is so ordered.

      . Because each of the plaintiffs has a distinct claim against the defendant, the value of their claims may not be aggregated to satisfy the jurisdictional amount requirement. Zahn v. International Paper Co., 414 U.S. 291, 294-95, 94 S.Ct. 505, 508-09, 38 L.Ed.2d 511 (1973).

      . As defendant points out, other sections of the Offering Circular indicate that only Class A and Class AA stock were converted under the company’s recapitalization plan and that the "exchange” upon which plaintiffs base their claim is no more than a hypothetical calculation made to facilitate comparison of certain financial data.

      . In particular, plaintiffs should seek inspection of defendant's corporate records in the manner established by Delaware law. See Del.Code Ann. tit. 8, § 220.


author: ZAMPANO, Senior District Judge.

text:
    Frederick CARPENTINO, Plaintiff, v. TRANSPORT INSURANCE COMPANY, Defendant.
    Civ. A. No. N-84-141 (RCZ).
    United States District Court, D. Connecticut.
    March 13, 1985.

      Joseph J. Kempf, Jr., Pearson, Baum & Weinstein, Hartford, Conn., for plaintiff.
    Stephen I. Traub, Lynch, Traub, Keefe and Snow, New Haven, Conn., for defendant.
   RULING ON MOTION TO DISMISS

ZAMPANO, Senior District Judge.

Pending before the Court is a motion to dismiss that raises interesting issues of federal diversity jurisdiction and Connecticut state law. For the reasons that follow, the motion to dismiss is denied.

I. FACTS

Accepting the factual allegations of the complaint as true, as the Court must, Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974), the following facts are relevant for the purposes of the motion to dismiss.

On January 16, 1981, plaintiff Frederick Carpentino, a Connecticut citizen, was injured while working for the Perkins Trucking Company (“Perkins”). He received worker’s compensation benefits from Perkins’ insurance carrier, defendant Transport Insurance Company (“Transport”), under a “voluntary agreement.” Transport is an Iowa corporation with its principal place of business outside Connecticut.

After an unspecified period of time, Transport unilaterally stopped making payments as required by the voluntary agreement, in violation of the procedures set forth under the Connecticut Worker’s Compensation Act, Conn.Gen.Stat. § 31-296. As discussed subsequently, the act requires state agency approval before “voluntary agreement” benefits may be discontinued.

Plaintiff states in his memorandum in opposition to this motion that he submitted a claim for past due benefits following the termination with the Compensation Commissioner. The Court has not been informed as to the status of those proceedings. This separate action was commenced in two counts on March 1, 1984, seeking unspecified “consequential damages” for 1) the bad faith breach of contractual obligations grounded on the defendant’s unilateral discontinuance of benefits; and 2) a violation of the Connecticut Unfair Trade Practices Act, Conn.Gen.Stat. § 42-110b, based on the alleged “unfair” treatment of the plaintiff by the defendant.

Defendant moves to dismiss the complaint in its entirety for lack of jurisdiction, and to dismiss either one or both of the causes of action for failure to state a claim on which relief may be granted.

II. JURISDICTION

Although the defendant concedes there is diversity of citizenship between the named parties, it contends that the action must be dismissed under 28 U.S.C. § 1332(c), which provides in pertinent part:

[I]n any direct action against the insurer of a policy or contract of liability insurance, whether incorporated or unincorporated, to which action the insured is not joined as a party-defendant, such insurer shall be deemed a citizen of the State of which the insured is a citizen, as well as of any State by which the insurer has been incorporated and of the State where it has its principal place of business.

The plaintiff has neither joined the insured, Perkins, as a party nor submitted proof of Perkins’ citizenship. Therefore, defendant argues, the Court lacks jurisdiction over the plaintiff’s “direct action” against the insurer of Perkins.

In 1964, Congress enacted § 1332(c) “to eliminate from diversity jurisdiction tort claims in which both parties are local residents, but which under a state direct action statute, are brought against a foreign insurance company without joining the local insured as a defendant.” Velez v. Crown Life Ins. Co., 599 F.2d 471, 473 (1 Cir.1979) (citing White v. United States Fidelity and Guaranty Co., 356 F.2d 746, 747 (1 Cir.1966)). See also Irvin v. Allstate Ins. Co., 436 F.Supp. 575, 576-77 (W.D.Okla. 1977); Bourget v. Government Employees Ins. Co., 313 F.Supp. 367, 370-71 (D.Conn. 1970), rev’d on other grounds, 456 F.2d 282 (2 Cir.1972). Thus, on the state of the present record, the defendant’s motion must be granted unless the Court determines that this lawsuit is not a “direct action” against the insurer.

It is well established that the term “direct action” as used in § 1332(c) is defined “as those cases in which a party suffering injuries or damage for which another is legally responsible is entitled to bring suit against the other’s liability insurer without joining the insured or first obtaining a judgment against him.” Beck- ham v. Safeco Ins. Co. of America, 691 F.2d 898, 902 (9 Cir.1982). See also Irvin, 436 F.Supp. at 575. The gravamen of the plaintiffs complaint here concerns the conduct of the insurer and not the insured. Monetary relief is sought for Transport’s wrongful termination of plaintiff’s benefits; no unlawful acts are alleged to have been committed by Perkins. Therefore, because Transport’s liability is grounded on its own conduct and not Perkins’, the Court is satisfied that § 1332(c) is not applicable to the case sub judice.

III. WRONGFUL TERMINATION OF BENEFITS

Count one of the complaint alleges that the defendant acted tortiously and in bad faith by terminating plaintiff’s compensation benefits contrary to the procedures mandated by the Workers Compensation Act (the “Act”), Conn.Gen.Stat. § 31-296. In challenging the viability of this cause of action in a judicial forum, the defendant asserts that the grievance falls within the exclusive subject matter jurisdiction provision of the Act. Therefore, it is argued, the plaintiff is bound to follow the administrative procedures set forth in the Act to remedy the alleged wrong, and may not obtain redress through this independent tort action.

As with most states, Connecticut has adopted a comprehensive and detailed statutory scheme for the filing and enforcement of workers’ compensation claims against employees. Section 31-284(a) of the Act, the general exclusivity provision, broadly prescribes in relevant part that “[a]ll rights and claims between employers and employees ... arising out of the personal injury or death sustained in the course of employment as aforesaid are abolished other than rights and claims by this chapter.”

The Act expressly provides for the filing of a voluntary agreement between an injured employee and the employer (or the insurance carrier) for the payment of compensation benefits. Id. § 31-296. Upon approval of the agreement by the Compensation Commissioner, it has the same legal effect as a compensation award and may not be discontinued without notice and stated reasons to the Commissioner and the employee. Id. § 31-300. A discontinuance of benefits does riot become effective until approved by the Commissioner in writing. Id.. § 31-296. Because the Commissioner has jurisdiction over “any proper action” concerning a voluntary agreement “during the whole compensation period applicable to the injury in question,” id. § 31-315, it seems clear that disputes directly relating to the modification or discontinuance of benefits under a voluntary agreement must be resolved by the Commissioner under the procedures set forth in the Act. In addition, should there be a unilateral discontinuance of benefits without proper notice and approval, the Commissioner is empowered to levy a penalty against the employer or insurer of “a reasonable attorney’s fee together with interest at a rate of six percent per annum on the discontinued payments.” Id. § 31-300.

The Court is convinced that, if the plaintiff in the instant action was seeking a recovery measured by loss of compensation payments under the voluntary agreement, the exclusivity provisions of the Act would preclude independent relief here, and the motion to dismiss would of necessity be granted. But, as emphasized by the plaintiff, he seeks no such relief. Rather, he seeks redress for the “bad faith” conduct on the part of the insurer which, he argues, is a tort separate and apart from any wrong covered by the Act. Damages would not be assessed by the value of the compensation benefits withheld, but by the injury proximately caused by the insurer’s intentional acts.

Hence, the precise issue presented is whether the exclusivity provisions of the Act bar an employee’s action at law for “consequential damages” caused by the intentional “bad faith” conduct of an employer’s insurer in terminating voluntary compensation payments under the Act. No reported case by the Connecticut Supreme Court has addressed the question; therefore, this Court “must make an estimate of what the state’s highest court would rule to be its law.” Cunningham v. Equitable Life Assurance Soc. of the United States, 652 F.2d 306, 308 (2 Cir.1981).

The Court’s research discloses that the jurisprudence on the issue which has evolved in other states has resulted in conflicting decisions. In at least seven states, statutes that contain either an exclusive remedy provision or a penalty clause have been construed to bar a tort action against an insurer for wrongful termination or delay of compensation payments. See Escobedo v. American Employers Ins. Co., 547 F.2d 544, 545 (10 Cir.1977) (applying New Mexico law); Whitten v. American Mutual Liability Ins. Co., 468 F.Supp. 470, 475 (D.S.C.1977) (applying South Carolina law), affd mem., 594 F.2d 860 (4 Cir.1979); Hixon v. State Compensation Fund, 115 Ariz.. 392, 393, 565 P.2d 898, 899 (1977); Old Republic Ins. Co. v. Whitworth, 442 So.2d 1078, 1979 (Fla.App.1983); Bright v. Nimmo, 253 Ga. 378, 320 S.E.2d 365, 368 (1984); Robertson v. Travelers Ins. Co., 95 Ill.2d 441, 448 N.E.2d 866, 871 (1983); Jadofsky v. Iowa Kemper Ins. Co., 355 N.W.2d 550, 552 (Wisc.App.1984). California and Alabama would apparently bar an independent action in cases that merely allege “bad faith” on the part of the insurer, although perhaps in outrageous cases of insurance company misconduct an independent action would be allowed. See Palmer v. R.L. Kautz & Co., 141 Cal.App.3d 155, 190 Cal. Rptr. 139, 144 (1983); Everfield v. State Compensation Ins. Fund, 115 Cal.App.3d 15, 171 Cal.Rptr. 164, 165-66 (1981); Bearden v. Equifax Servs., 455 So.2d 836, 836 (Ala.1984).

The reasoning of these cases was summarized in Robertson, 448 N.E.2d at 870, as follows:

The rationale of these cases has typically been that the legislature, anticipating that bad faith in delaying payment of benefits would occur on occasion, provided a “quick, simple and readily accessible method” of resolving disputes over such payments without “the proof and defenses incident [to a common law action], the intolerable delay in resolution of a lawsuit, economic waste to all and expense to the worker” [citations omitted], or the specter of “multiple jurisdictions' being engaged in the resolution of the same basic questions with the possibility of conflicting results” [citations omitted].

Id. See also Whitworth, 442 So.2d at 1079 (“intentional nonperformance of a statutory duty” may be remedied before workers’ compensation board); Hicks v. Board of Education, 77 Ill.App.3d 974, 33 Ill.Dec. 683, 397 N.E.2d 16, 19-20 (1979) (50 percent penalty in cases of wrongful termination of compensation payments implies legislative intent to bar tort action at law).

On the other hand, at least eight states have permitted independent tort actions in cases involving wrongful termination or delay of benefits, or in other situations similar to the ease at bar. See Hollman v. Liberty Mutual Ins. Co., 712 F.2d 1259, 1261 (8 Cir.1983) (applying South Dakota law); Reed v. Hartford Accident and Indemnity Co., 367 F.Supp. 134, 135 (E.D.Pa. 1973) (applying Pennsylvania law); Stafford v. Westchester Fire Ins. Co., 526 P.2d 37, 43 (Alaska 1974), overruled on other grounds, Cooper v. Argonaut Ins. Co., 556 P.2d 525 (Alaska 1976); Savio v. Travelers Ins. Co., 678 P.2d 549, 552 (Colo.App.1983), cert, granted, No. 83 FC 316 (Colo. Mar. 5, 1984); Gibson v. National Ben Franklin Ins. Co., 387 A.2d 220, 222 (Me.1978); Broaddus v. Ferndale Fastener Div., 84 Mich.App. 593, 269 N.W.2d 689, 693 (1978); Birkenbuel v. Montana State Compensation Ins. Fund, 687 P.2d 700, 702 (Mont. 1984); DeMarco v. Federal Ins. Co., 99 A.D.2d 114, 472 N.Y.S.2d 464, 466-67 (1984). Cf. Baker v. American States Ins. Co., 428 N.E.2d 1342, 1346-47 (Ind.App. 1981); Massey v. Armco Steel Co., 652 S.W.2d 932, 933-34 (Tex.1983). As noted above, California and Alabama would apparently allow an independent action only if the insurer’s conduct is particularly outrageous. Compare Unruh v. Truck Ins. Exchange, 7 Cal.3d 616, 102 Cal.Rptr. 815, 498 P.2d 1063 (1972), with Everfield, 171 Cal.Rptr. at 165-66. Bearden, 455 So.2d at 836. It is also appropriate to mention that the First Circuit has ruled that an independent tort action against the insurer is not barred by an exclusivity provision in the federal Longshoremen’s and Harbor Workers Compensation Act, 33 U.S.C. §§ 901-950. Martin v. Travelers Ins. Co., 497 F.2d 329, 331 (1 Cir.1974).

Various analyses have been employed to justify the refusal to limit the scope of the courts’ jurisdiction in the cited cases. Most of the authorities rely heavily on the determination that the various workers’ compensation acts were not intended or designed to compensate for the type of harm alleged. See, e.g., Gibson, 387 A.2d at 222 (injury from wrongful termination of benefits does not “arise out of employment,” therefore action not prohibited by exclusivity clause); Hayes v. Aetna Fire Underwriters, 187 Mont. 148, 609 P.2d 257, 261 (Mont.1980) (injury not in course of employment and legislature did not foresee intentional misconduct by insurers in enacting penalty provision). As stated in the recent leading case in New York, DeMarco, 472 N.Y.S.2d at 466:

[T]he gravamen of plaintiffs’ cause of action lies in intentional tort and/or fraudulent breach of an insurer’s duty of good faith and fair dealing; many of the damages claimed are clearly outside of the purview of awardable workers’ compensation benefits. It was never intended that injuries thus caused were to be exclusively the province of the Workers’ Compensation Board.

Id. An important factor in these decisions appears to be the relatively low statutory penalties for wrongful delay. A leading commentator in the field appears to support this line of decisions, at least in cases that allege more than a “simple delay in payments” or mere “termination of treatment.” 2A Larson, Workmen’s Compensation Law § 68.34(c), at 13-76 (1983).

While not free from doubt, this Court believes that the Connecticut Supreme Court, when confronted with the issue, will conclude that actions, grounded on rather unusual allegations of intentional tortious acts as in the instant case, survive the Act’s exclusivity provisions. On balance, several factors preponderate in support of this conclusion. First, the Act speaks only to compensation for personal injury or death “arising out” of “employment.” It does not purport to provide redress for an otherwise cognizable tort that occurs outside the “natural and necessary incident or consequence of the employment,” Dennison v. Connecticut Good Humor, Inc., 130 Conn. 8, 10—11, 31 A.2d 332 (1943), nor does it authorize damages for a wrong to an employee unless “it occurs within the period of his employment, at a place where he may reasonably be, and while he is reasonably fulfilling the duties of his employment____” Davis v. Goldie Motors, Inc., 129 Conn. 240, 242, 27 A.2d 164 (1942). In the instant case, these criteria for the Commissioner to have jurisdiction under the Act are not present; the plaintiff’s cause of action is predicated on a wrong committed by the insurer long after his original work-related injury and the termination of his employment at Perkins.

Second, the Act should not be an impervious barrier, insulating a wrongdoer from the payment of just and fair damages for intentional tortious acts only very tenuously related to workplace accidents. The public interest requires that wrongs be redressed, that unlawful conduct be discouraged and punished, and that an innocent victim be compensated for his injuries.

Third, it is reasonable to infer that, because the penalty provision in the Act provides only for attorney’s fees and six percent interest, the legislature contemplated that additional remedies could be sought in an action at law for tort damages to compensate fully claimants for the insurer’s actions unrelated to workplace accidents. The penalties prescribed, which in the overwhelming majority of the cases will be triggered by an insurer’s mere inadvertence, negligence, or mismanagement of the employee’s personal injury claim, seem hardly sufficient to remedy an insurer’s intentional tortious conduct.

Fourth, it is questionable whether an “exclusivity” provision in the Act can be constitutionally sustained if it results in an aggrieved person being deprived of his due process rights to full redress for another’s willful misconduct. Finally, the Court is not persuaded that the effect of its holding will open the floodgates to lawsuits against insurers by every injured employee who may be dissatisfied with the processing or the amount of his compensation benefits. Very special factual allegations and narrow circumstances are required to institute the action. Moreover, prompt resolution of the meritless action is readily available by a motion for summary judgment.

For the foregoing reasons, the defendant’s motion to dismiss count one of the complaint is denied.

IV. UNFAIR TRADE PRACTICE

The second count of the complaint alleges that defendant’s actions constitute an unfair trade practice under the Connecticut Unfair Trade Practices Act (“CUTPA”), Conn.Gen.Stat. § 42-110b, which provides in pertinent part that “[n]o person shall engage in unfair methods of competition and unfair or deceptive acts or practices in conduct of any trade or commerce.” Id. § 42-110b(a). In addition to its position that the exclusivity provision of the Act is a bar to count one, which the Court has rejected, the defendant moves to dismiss count two on the ground that the instant private dispute does not embody any claim cognizable under CUTPA.

The defendant’s argument is premised on the lack of a “specific and substantial” public interest involved in the plaintiff’s lawsuit, and that; even if relief is granted, it would merely provide the plaintiff with a redress of a private wrong rather than be an effective sanction “to deter unfair trade practices that injure the general consuming public.” Ivey, Barnum & O’Mara v. Indian Harbor Properties, 190 Conn. 528, 540, 461 A.2d 1369 (1983).

The defendant cites correctly the criteria enunciated in Ivey, Barnum to sustain an award under CUTPA. However, on June 8, 1984, the effect of Ivey, Barnum was annulled when the legislature enacted Public Act 84-468, which states in part: “Proof of public interest shall not be required in any action brought under [CUTPA].” Id. § 2. No sound reason is apparent not to apply the amendment retroactively in this action. In any event, the Court is satisfied that, even under the Ivey, Barnum standards, the cause of action should stand.

While there appears to be no published Connecticut decision applying CUT-PA to the facts alleged, it is generally accepted that three factors should be considered in determining the viability of a claim for an unfair trade practice under CUTPA: “(1) whether the practice injures consumers; (2) whether it violates established public policy; (3) whether it is unethical or unscrupulous.” Federal Trade Commission Statement of Policy on the Scope of Consumer Unfairness Jurisdiction (“Unfairness Statement”), [1969-1983 Transfer Binder] Trade Reg.Rep. (CCH) ¶ 50,421, at 55,937. See FTC v. Sperry & Hutchinson Co., 405 U.S. 233, 244-45, 92 S.Ct. 898, 905-06, 31 L.Ed.2d 170 (1972); Conaway v. Prestia, 191 Conn. 484, 492-93, 464 A.2d 847 (1983). See also McLaughlin Ford v. Ford Motor Co., 192 Conn. 558, 568, 473 A.2d 1185 (1984).

On the present record, the injury factor is evident: the plaintiff seeks monetary relief for damages incurred as a result of Transport’s intentional misconduct. The misconduct is not outweighed by any countervailing benefits to the public. Moreover, the injury, caused by an insurer not chosen by the plaintiff, could not have been reasonably avoided by the plaintiff. See Unfairness Statement at 55,949; McLaughlin Ford, 192 Conn, at 569-70, 473 A.2d 1185. Second, unilateral discontinuance of the voluntary agreement, expressly prohibited by statute, may be deemed to violate public policy. Unfairness Statement at 55,-949 (conduct that violates public policy “as it has been established by statute, common law, industry practice, or otherwise” contributes to finding of unfairness). The third test, unscrupulous behavior, is “largely duplicative” of the other two criteria, id., but nevertheless would certainly be present here if the proof supports the plaintiff’s allegations of wrongdoing by the insurer.

For these reasons, the motion to dismiss count two for failure to state a claim on which relief may be granted is denied.

Finally, defendant requests that the Court abstain-from ruling on the CUTPA claim, citing as authority Naylor v. Case and McGrath, Inc., 585 F.2d 557, 564-65 (2 Cir.1978). The Court declines the invitation. See Bailey Employment System, Inc. v. Hahn, 655 F.2d 473, 477 n. 6 (2 Cir.1981).

IV. ORDER

For the foregoing reasons, the motion to dismiss is denied. Counsel shall file a stipulated proposed scheduling order for further proceedings in this lawsuit within 30 days.

      . The plaintiff states in his reply brief that Perkins was organized under New York law and had its principal place of business in New York. His failure to submit an appropriate affidavit or to seek an amendment of the complaint on the issue is difficult for the Court to understand.

      . Wisconsin formerly recognized the right to an independent action, Coleman v. American Universal Ins. Co., 86 Wisc.2d 615, 273 N.W.2d 220, 221 (1979), but the legislature amended the state’s workers compensation act to remove such right, Wisc.Stat.Ann. § 102.18(1)(bp) (West Supp. 1984-1985).

      . The prevailing rules in California are reviewed in Kornblum, Extracontract Actions Against Insurers: What’s Ahead in the Eighties?, 20 Forum 58 (Sept. 1983).

      . As a whole, the states that do not recognize independent tort actions for “bad faith" delay or termination of benefits tend to provide for relatively harsh administrative penalties if payments are wrongfully delayed or terminated, usually in addition to attorney's fees. Ala.Code § 25-5-8(e) (1975) (civil penalty of double amount payable plus injunctive relief); Ariz. Rev.Stat.Ann. § 23-966(A) (West Supp.1983-1984) (employee entitled to immediate payment from state, then state may recover against carrier); Cal.Lab.Code § 5815 (West 1971) (award increased 10%); Fla.Stat.Ann. § 440.20(8)-(9) (West 1984) (award increased by up to 20% plus 12% interest); Ga.Code § 34-9-221 (1982) (award increased up to 20%); Ill.Ann.Stat. ch. 48, § 138.19(k) (Smith-Hurd Supp.1984-1985) (award increased 50%); S.C.Code Ann. § 42-9-260 (Law Co-op.1976) (25% increase in award); Wisc.Stat.Ann. § 102.18(l)(bp) (West Supp. 1984-1985) (award increased by lesser of $15,-000 and 200% of total compensation).

      . Gibson is noted in Tortious Withholding of Insurance Benefits: Gibson v. National Ben Franklin Ins. Co., 30 Me.L.Rev. 308 (1978).

      . See Alaska Stat. § 23.30.030(7) (1984) (carriers' licenses may be revoked, no express penalty in favor of employee); Colo.Rev.Stat. § 8-52-110 (1973) (no express penalty in favor of employee); Maine Rev.Stat.Ann. tit. 39, § 104-A (Supp.1984-1985) (award may be increased up to $25 per day); Mich.Comp.Laws Ann. § 418.-631(1) (West Supp.1984-1985) (possible revocation of license for repeated or unreasonable failure to pay, no provision for increased award to employee); Mont.Code Ann. § 39-71-611 (1983) (provision for costs and attorney’s fees); N.Y.Work.Comp.Law § 25(3)(c) (McKinney Supp.1984-1985) (20% increase in award to employee); Pa.Stat.Ann. tit. 77, § 1059 (West Supp. 1984-1985) (provision for 5% penalty to state); S.D.Comp.Laws Ann. §§ 62-5-1 to 62-5-9 (1978) (no express penalty).

      . Professor Larson notes in discussing cases involving insurance carrier harassment during claim investigation, which are somewhat similar to the type of case sub judice, that it could be argued that any damages the claimant incurred as a result of wrongful conduct of the carrier were merely an "aggravation" of the first injury. However, he sharply criticized that view, arguing that "[t]o say that the second injury was only an aggravation or extension of the first injury, one would have to accept a kind of but-for theory that could lead to preposterous results." 2A Larson, supra § 68.34(b), at 13-67.

      . CUTPA prohibits any "person" from engaging in unfair acts or practices in the conduct of any "trade or commerce.” Conn.Gen.Stat. § 42-110b(a). Transport does not argue that it is not a "person," nor does it suggest that the activity involved in this matter is not “trade or commerce," therefore the Court does not address the issues.

      . As in all CUTPA cases, the Court must “be guided by” interpretations of the Federal Trade Commission Act (“FTC Act”), 15 U.S.C. § 45(a)(1). Conn.Gen.Stat. § 42-110b(b).
      Most "unfairness” cases arising under the FTC Act and CUTPA concern sales practices. However, the Court considers the quoted factors above highly useful in the analysis of the case sub fudice, which does not involve advertising. See Unfairness Statement at 55,947 n. 10 ("These standards for unfairness are generally applicable to both advertising and nonadvertising cases.”).
      It should be noted briefly that these factors were not intended to be applied in cases alleging "unfair methods of competition," which are also proscribed by § 5(a)(1) of the FTC Act and by CUTPA. See Unfairness Statement at 55,947. Nor are they intended to apply to cases alleging "deceptive” acts or practices, in which an entirely different set of factors is applied. See Bailey & Pertschuk, The Law of Deception: The Past as Prologue, 33 Am.U.L.Rev. 849 (1984).

      . Analysis of recent Connecticut CUTPA cases may be found in Bartlett & Romano, Connecticut Unfair Trade Practices Act and Connecticut Unfair Insurance Practices Act: Expanding Legal Horizons, 58 Conn.B.J. 302, 302-11 (1984). Federal cases construing § 5 of the FTC Act are reviewed in Averitt, The Meaning of Unfair Acts on Practices in § 5 of the Federal Trade Commission Act, 70 Geo.LJ. 225 (1981).


author: BILLINGS, District Judge.

text:
    UNITED STATES of America v. Kenneth Lee ESTES.
    Crim. No. 84-55-1.
    United States District Court, D. Vermont.
    March 15, 1985.
    As Amended April 8, 1985.

      Christopher Baril, Asst. U.S. Atty., Rutland, Vt., for plaintiff.
    Richard I. Rubin, Barre, Vt., for defendant.
   FINDINGS OF FACT, OPINION AND ORDER

BILLINGS, District Judge.

Introduction

This matter came before the Court for a hearing on all pending motions on February 4, 1985. The defendant was present and represented by Richard Rubin, Esq. Present on behalf of the Government were Assistant U.S. Attorneys Peter Hall and Chris Baril.

Defendant stands charged by a three-count indictment with violations of 18 U.S.C. § 2113(b) (bank robbery) and 18 U.S.C. § 1623 (false declarations before a grand jury). The following pretrial motions have been filed on defendant’s behalf:

1. Motion to Dismiss Indictment;
2. Motion for Disclosure of Grand Jury Testimony;
3. Motion to Suppress Taped Communications;
4. Motion to Suppress Evidence Obtained Pursuant to Search; arid
5. Motion in Limine.

After setting forth the facts surrounding the case, as found from the evidentiary hearing, the Court will address each of the pending motions seriatim. For purposes of the motions now before the Court, we must assume the truth of the evidence admitted at the hearing.

Findings of Fact

On or about February 24, 1982, employees at the Federal Reserve Bank in Boston, Massachusetts discovered that approximately $55,000.00 was missing from a money shipment that had been shipped via the Purolator Armored car service from the Vermont National Bank in Rutland, Vermont. On or about the same day defendant, an employee of Purolator residing in Manchester, Connecticut, arrived home with a motorcycle saddlebag full of money. Defendant’s then wife, now Mrs. Lydia Turbert, observed defendant arrive home and noticed he had a strange look on his face. She asked defendant what was wrong and he then showed her the money in the saddlebag. Defendant told his wife he stole the money from Purolator. The couple then proceeded upstairs to their bedroom and defendant poured the money out of the saddlebag and onto the couple’s bed.

At first, Mrs. Turbert was surprised and asked defendant if he could return the money to Purolator. She then decided it would be nice to keep the money, as she and her husband were so poor they could not adequately provide for their three children. Accordingly, Mrs. Turbert decided to assist her husband with the money.

Defendant told his wife that he used a “crimper” to open and, then, reseal the canvas bags from which he removed the money. Mrs. Turbert had earlier observed the crimping device used by defendant hidden in a closet in their home.

Mrs. Turbert observed defendant take the first and last bill from each stack of bills, tear them into small pieces and place them in a jar of carpet cleaning solution so that the torn-up bills would dissolve. He then hid the rest of the money in a closet. The next day, defendant, while in his wife’s presence, placed as much money as would fit in a plastic cooler. He then covered the cooler with a plastic garbage bag. Defendant took the money, the crimper and the cleaning solution to the Portland Reservoir. He buried the money and threw the crimper and cleaning solution in the reservoir.

While defendant was at the reservoir, Mrs. Turbert removed a front panel from one of the steps in the stairway of their home. This was done in an effort to find a place to hide the money that would not fit in the cooler, estimated by Mrs. Turbert to be approximately $15,000.00. Mrs. Turbert placed the money in a hollow space behind the stair. She then replaced the front panel.

With the money that was hidden behind the stairs, the couple purchased several items for their home, including a television, a stereo, mattresses and linens for their childrens’ beds and kitchen supplies. Defendant also purchased a used van with the stolen money. The money used to buy the van was “laundered” by Mrs. Turbert who made trips to several different Hartford banks for the purpose of exchanging smaller, stolen bills for larger bills.

During the course of time, the money supply behind the stairway depleted, so the couple made several trips to the reservoir to unearth and use more of the stolen money that defendant had hid there.

During the summer months of 1982, Mrs. Turbert moved out of the couple’s home and moved into a friend’s house. During the time they were separated, Mrs. Turbert made several drug purchases on defendant’s behalf. These purchases consisted largely of cocaine. Mrs. Turbert made approximately six purchases on defendant’s behalf and the cost of each purchase was approximately $2,500.00. Mrs. Turbert felt compelled to buy the drugs, as her husband threatened to file a claim for desertion if she did not.

Mrs. Turbert and defendant were divorced on December 6, 1983. Mrs. Turbert married Mark Turbert on April 14, 1984.

In early July of 1984, Special Agent Callahan, an FBI agent stationed in Waterbury, Connecticut, received a call from Agent Millen, an FBI agent in Hartford, Connecticut, who stated that Mrs. Turbert had information regarding a Purolator robbery. Thereupon, Agent Callahan contacted Mrs. Turbert and arranged to meet with her.

On July 18,1984, Agent Callahan went to Mrs. Turbert’s home in Torrington, Connecticut to meet and discuss with her the information she had regarding the robbery. During the meeting, which lasted approximately three hours, Mrs. Turbert explained that she was defendant’s ex-wife and that, in February of 1982 when they were still married, defendant robbed a substantial sum of money from Purolator.

Before detailing the events surrounding the robbery, Mrs. Turbert expressed concern that she would be prosecuted for her involvement with the crime and that she would lose her children as a result. Mrs. Turbert reiterated this concern several times during the course of the meeting. She also explained that she decided to come forward with information about the crime because defendant’s present wife’s ex-husband, David Nailon, threatened to reveal the information if she (Mrs. Turbert) did not. Accordingly, in exchange for her cooperation and information, Mrs. Turbert wanted assurances from the Government that she would not be prosecuted. Agent Callahan explained that, although he could not give Mrs. Turbert advice as to whether she was privileged from testifying against her former husband or as to what her rights were in general, he could give her verbal assurances that, if she cooperated, she would not be prosecuted.

After receiving the necessary assurances, Mrs. Turbert gave Agent Callahan information regarding the crime. At the end of the meeting, the parties decided to tape a telephone conversation between Mrs. Turbert and defendant. Mrs. Turbert explained that the conversation would have to take place at a public phone, as defendant believed that both his phone and Mrs. Turbert’s phone were tapped. At the original meeting, no date was set for taping the conversation, rather, it was decided that Mrs. Turbert would contact Agent Callahan when she was ready.

Subsequently, Mrs. Turbert contacted Callahan to arrange a time to tape the conversation. The parties agreed to do the taping on July 24, 1984. During that conversation, Mrs. Turbert again expressed her desire to receive assurance of immunity before going forward. Agent Callahan told Mrs.-Turbert that she would receive a letter of immunity from the United States Attorney’s office in Vermont before the date set for the phone call to defendant.

On July 24, 1984, Agent Callahan and Agent John Hooks arrived at Mrs. Turbert’s residence for the purpose of taping the conversation. At that time, Mrs. Turbert asked about the letter of immunity and Mr. Callahan again reassured her that she would not be prosecuted and explained that the letter was forthcoming. In exchange for these assurances, Mrs. Turbert agreed to sign a consent form which stated that she “voluntarily and without threat or promise” consented to tape the conversation. If Mrs. Turbert did not receive these assurances, she would not have made the phone call. The parties then proceeded to a public telephone booth and Mrs. Turbert placed a call to her former husband. However, the phone was malfunctioning and the parties were forced to go to another public phone booth in a different part of town. Mrs. Turbert placed a second call to defendant. The defendant then called her back and the ensuing conversation was taped. During the taping, Agents Callahan and Hooks and Mr. Turbert were all standing a few feet away from Mrs. Turbert. At no time during the course of the phone calls did Mrs. Turbert expressly or impliedly withdraw her consent to tape the conversation with defendant.

On September 15, 1984, Mrs. Turbert recorded another conversation with defendant. This conversation was recorded at Mrs. Turbert’s residence in Torrington on a Radio Shack home taping device. Mrs. Turbert voluntarily turned over the tape to Agent Callahan, who had no prior knowledge of this second taping.

On or about October 10, 1984, Mrs. Turbert received a letter of immunity from prosecution from Assistant U.S. Attorney Peter Hall. Thereafter, Mrs. Turbert testified against defendant before the’ Grand Jury investigation of this matter. At no time during the course of her dealings with authorities regarding this matter was Mrs. Turbert advised that she could not claim a privilege against giving testimony about her marital communications with ■ defendant.

Discussion

A. Motion To Dismiss Indictment

Defendant moves to dismiss the indictment, claiming that it is tainted by Mrs. Turbert’s incompetent testimony before the Grand Jury and that it was obtained through gross prosecutorial misconduct. The government denies that Mrs. Turbert’s testimony amounted to incompetent evidence and further contends that there has been no showing of prosecutorial misconduct in this case.

The defendant claims that Mrs. Turbert’s testimony before the Grand Jury was incompetent because it pertained to confidential marital communications and, as such, was privileged from disclosure. Ordinarily, the marital communications privilege prevents the testifying spouse (or former spouse) from disclosing confidential communications between the spouses. United States v. Ammar, 714 F.2d 238, 258 (3rd Cir.), cert, denied sub nom., Stillman v. United States, — U.S. —, 104 S.Ct. 344, 78 L.Ed.2d 311 (1983). This privilege survives the marriage, Pereira v. United States, 347 U.S. 1, 6, 74 S.Ct. 358, 361, 98 L.Ed. 435 (1954), and is applicable in Grand Jury proceedings. F.R.E. 1101(c), (d). However, a number of courts have held that confidential marital communications concerning ongoing criminal activity are not protected by the privilege. United States v. Archer, 733 F.2d 354 (5th Cir. 1984); United States v. Broome, 732 F.2d 363 (4th Cir.1984); United States v. Ammar, supra, at 258; United States v. Mendoza, 574 F.2d 1373 (5th Cir.1978); United States v. Kahn, 471 F.2d 191 (7th Cir.1972), cert, denied, 411 U.S. 986, 93 S.Ct. 2271, 36 L.Ed.2d 964 (1973). This is likely to be the rule followed by the Second Circuit. See United States v. Cotroni, 527 F.2d 708 (2d Cir.1975), citing United States v. Kahn, supra. See also United States v. Shipp, 578 F.Supp. 980, 991 (S.D.N.Y.1984), citing United States v. Mendoza, supra.

In this case, all of Mrs. Turbert’s Grand Jury testimony related to defendant’s ongoing criminal activity. Moreover, Mrs. Turbert had made the conscious decision, almost from the start, to play an active role in the secreting and use of the stolen money. Therefore, since it related exclusively to ongoing criminal activity, Mrs. Turbert’s testimony does not fall under the confidential marital communications privilege.

Defendant claims that because Mrs. Turbert is not a co-defendant in this case and because she does not stand to be prosecuted for her involvement in the crime, the marital communications privilege should apply. However, the “criminal activity” exception to the privilege has not been so narrowly construed. S,o long as the conversations are made in the furtherance of criminal activity, the exception applies. See United States v. Ammar, supra, at 258. There need be no showing of culpability on the part of the testifying spouse. Accord United States v. Entrekin, 624 F.2d 597, 598 (5th Cir.1980). In this case, the record discloses that all the challenged conversations (and acts) were made in the furtherance of joint efforts to hide and use the stolen money.

The “criminal activity” exception evolved because it was determined that the need to attain justice is greater than the need to encourage domestic tranquility See Arrimar, supra, at 257. Other privileges, such as the attorney-client privilege have been similarly limited. This Court can divine no logical reason to limit the “criminal activity” exception to culpable spouses.

The fact that Mrs. Turbert’s Grand Jury testimony is not privileged per force vitiates defendant’s claim that Mrs! Turbert’s testimony was obtained through prosecutorial misconduct.

Accordingly, defendant’s motion to dismiss the indictment must be denied.

B. Motion for Disclosure of Grand Jury Testimony

The defendant seeks disclosure of the Grand Jury testimony of Lydia Turbert, defendant’s ex-wife, Robert Plikaitis and Donald Cowles, both employees of Purolator. The Government opposes the motion on the ground that the defendant has failed to show a “particularized” need therefor.

Ordinarily, minutes of Grand Jury investigations may not be disclosed. Fed.R. Cr.P. 6(e)(2). An exception to this rule exists where the court grants disclosure preliminarily to, or in connection with, a judicial proceeding or upon a showing by the defendant that grounds may exist to dismiss the indictment because of matters occurring before the Grand Jury. Id. at 6(e)(3)(C)(i) and (iii).

The disclosure of Grand Jury testimony prior to, or in connection with, judicial proceedings requires a showing by the defendant that there exists a “particularized” need for such disclosure. Dennis v. United States, 384 U.S. 855, 870, 86 S.Ct. 1840, 1849, 16 L.Ed.2d 973 (1966); United States v. Youngblood, 379 F.2d 365, 369 (2d Cir.1967).

The Supreme Court has recently restated this standard. In Illinois v. Abbott & Associates, Inc., 460 U.S. 557, 567, 103 S.Ct. 1356, 1361, 75 L.Ed.2d 281 (1983), the Court stated:

The court, however, is authorized by Rule 6(e)(3)(C) to permit certain disclosures that are .otherwise prohibited by the “General Rule of Secrecy.” The scope of that authority has been delineated in a series of cases setting forth the standard of “particularized need.”

Further, the Court pointed out that “particularized need” means more than mere relevance. Id. at 568, 103 S.Ct. at 1362. The party seeking disclosure must show: ,(1) that the need for the disclosure outweighs the need for secrecy; (2) that the materials are necessary to avoid injustice; and (3) that the request is structured to cover only those materials that are needed. Douglas Oil Co. v. Petrol Stops Northwest, 441 U.S. 211, 222, 99 S.Ct. 1667, 1674, 60 L.Ed.2d 156 (1979).

As presently framed, defendant’s motion for Grand Jury testimony is premised solely on the assertion that the requested material is needed to prepare an adequate defense. This claim is more akin to an assertion that the material is relevant, proscribed in Illinois, supra, 460 U.S. at 568,103 S.Ct. at 1362, than a showing of a particularized need for the material in order to prevent injustice to defendant.

Because defendant has failed to show a particularized need for the material under the three-prong test set forth in Douglas, supra, the motion for Grand Jury testimony must be denied.

C. Motion to Suppress Taped Statements

The defendant has moved to suppress tape recordings made by Mrs. Turbert of two, separate conversations she had with defendant over the telephone. As grounds for this motion, defendant claims that the tape recordings violate the provisions of 18 U.S.C. § 2511(2)(c), the so-called wiretap statute, because Mrs. Turbert did not voluntarily agree to make the tape recordings.

Under the wiretap statute, 18 U.S.C. § 2515, all evidence gathered in violation of § 2511, which makes it illegal to intercept any wire or oral communication, must be suppressed. Section 2511(2)(c) sets forth an exception to • this rule which provides that:

It shall not be unlawful under this chapter for a person acting under color of law to intercept a wire or oral communication, where such person is a party to the communication or one of the parties to the communication has given prior consent to such interception.

Bottomed on this particular section of the wiretap statute, the only issue raised by defendant’s argument is whether the two tapings, one recorded in the presence of Agents Callahan and Hooks on July 24, 1984 and the other recorded by Mrs. Turbert at home on September 15, 1984, were consensually intercepted by Mrs. Turbert.

Whether a person’s consent to intercept a conversation is valid depends upon whether it is voluntary and uncoerced. United States v. Kolodziej, 706 F.2d 590, 593 (5th Cir.1983). The Government has the.burden of proving the voluntariness of consent and, where there is a claim of coercion, the Government must show that there has been no “undue pressure, threats, or improper inducement.” Id. at 593. Here, the only possible facts from which this Court can infer coercion is Mrs. Turbert’s request for immunity in exchange for recording the conversations. However, it is well settled that “raised expectations and hopes for leniency do not amount to coercion or improper inducement.” Id. See also United States v. Salisbury, 662 F.2d 738, 739 (11th Cir. 1981), cert, denied, 457 U.S. 1107, 102 S.Ct. 2907, 73 L.Ed.2d 1316 (1982) (absent evidence that interceptor was overcome by threats or improper inducement, there can be no finding of involuntariness).

Contrary to defendant’s assertions, the facts of this case indicate that Mrs. Turbert freely entered into the agreement to tape the conversation with defendant on July 24, 1984. To be sure, Mrs. Turbert’s motives at that time were self serving, but her free will was not overborne by her decision to cooperate with the Government.

As for the conversation recorded on September 15, 1984, it cannot be said that Mrs. Turbert intercepted the conversation voluntarily or that she was acting under color of law at the time, as is required under the § 2511(2)(c) exception. The September 15 conversation was recorded accidentally and without the knowledge of law enforcement officials. The September 15 interception was not violative of the wiretap statute, however, because § 2511(2)(d) specifically exempts situations in which one party to the conversation is herself the interceptor. Having taped the conversation herself, and not in the presence of or at the direction of Agent Callahan, Mrs. Turbert was the sole interceptor of the conversation and, thus, the recording was not in violation of the statute. See United States v. Turk, 526 F.2d 654, 657 (5th Cir. 1976). Nor did Agent Callahan violate the statute by listening to the September 15, 1984 taped conversation. See id. at 658-59.

Accordingly, defendant’s motion to suppress the taped conversations must be denied.

D. Motion to Suppress Evidence Obtained Pursuant to Search

Defendant next claims that certain evidence obtained pursuant to execution of a search warrant at his home should be suppressed. Defendant argues that the information in the affidavit filed in support of the warrant was obtained in violation of federal law. According to defendant, since much of the information in the affidavit was privileged under the marital communications rule, it was obtained in violation of federal law. F.R.E. 1101(c) and (d). The Government, on the other hand, argues that even if the information in the affidavit is privileged, it was nevertheless obtained in good faith and, thus, suppression would be improper.

Without a doubt, the marital communications privilege applies to proceedings held for the issuance of search warrants. F.R.E. 1101(c) and (d). See also United States v. Lefkowitz, 618 F.2d 1313, 1317 n. 5 (9th Cir.1980). However, as noted previously, supra at p. 568, the privilege does not apply to communications about ongoing criminal activity. Since much, if not all, of the information supplied by Mrs. Turbert in the affidavit relates to criminal activity, it is not privileged. Moreover, even if the information were privileged, defendant has failed to produce any evidence that the information was obtained in reckless and dishonest disregard for its validity. See United States v. Leon, — U.S. —, 104 S.Ct. 3405, 82 L.Ed.2d 677 (1984); Franks v. Delaware, 438 U.S. 154, 98 S.Ct. 2674, 57 L.Ed.2d 667 (1978).

For the above-stated reasons, defendant’s motion to suppress the evidence obtained pursuant to execution of the search warrant must be denied.

E. Motion in Limine

Defendant’s final claim is that all of Mrs. Turbert’s testimony must be excluded from trial on the grounds that it is privileged under the marital communications rule. To be privileged, the marital communications must be confidential and they must have occurred during the marriage. Also, as stated earlier, see Discussion, supra, at pp. 568-569, the marital communications privilege does not apply to conversations made in the furtherance of criminal activity. Accordingly, Mrs. Turbert’s testimony will be excluded only to the extent that it relates to communications between herself and defendant that occurred during their marriage, that were intended to be confidential and that do not relate to ongoing criminal activity. This limitation applies equally to defendant’s communicative acts witnessed by Mrs. Turbert during their marriage.

ORDER

For the foregoing reasons, all of defendant’s motions must be and are DENIED.

SO ORDERED.


author: HARPER, District Judge.

text:
    PIPE SYSTEMS, INC., Plaintiff, v. AMERICAN MANUFACTURERS MUTUAL INSURANCE COMPANY, Defendant.
    No. 84-2584C(A).
    United States District Court, E.D. Missouri, E.D.
    March 19, 1985.

      Theodore F. Schwartz, Clayton, Mo., for plaintiff.
    Leritz, Reinert & Duree, Bernard A. Reinert, St. Louis, Mo., for defendant.
   MEMORANDUM AND ORDER

HARPER, District Judge.

This matter is before the Court on the defendant’s motion to dismiss .for lack of jurisdiction and improper venue pursuant to Rule 12(b)(1) and 12(b)(3) Federal Rules of Civil Procedure.

Plaintiff is a Missouri corporation engaged in the business of furnishing pipe and other materials for construction and maintains its principal place of business in St. Louis County, Missouri. Plaintiff alleges that defendant is a corporation organized and existing under the laws of a state other than Missouri and maintains its principal place of business in the State of Illinois.

In the complaint, plaintiff alleges that it sold materials and furnished equipment to a contractor who was constructing a sewage collection facility in Iberia Parish, Louisiana. The contractor had entered into a contract with Sewage District No. 1 of Iberia Parish, Louisiana for the construction of that project. As required by the Louisiana Public Works Act La.R.S. 38:2241 et seq., the contractor obtained a public works bond. Defendant, as surety, issued the bond in the amount of $607,-553.50. Defendant’s liability under the bond matures in the event that the contractor defaults on its obligation to finish the project and to pay for labor and materials used on the project.

Plaintiff alleges that the contractor is in default of its obligations and that defendant, therefore, is required to pay sums due and owing plaintiff pursuant to the terms of the bond. Defendant acknowledges plaintiff’s claim, but disputes the amount claimed by plaintiff.

Defendant’s brief supporting its motion to dismiss asserts that plaintiff’s action should be dismissed by this Court for lack of jurisdiction and improper venue because suit has not been filed “ * * * in the proper court of the parish where the work was done * * * ” as required by the Louisiana Public Works Act § 2243, La.R.S. 38:2243. Defendant asserts that the Louisiana Public Works Act proscribes an exclusive procedure for resolving claims against the statutorily required public works bond.

Plaintiff contends that the statutory procedure proscribed by § 2243 of the Act is not mandatory; and further, that the terms of the Louisiana statute are not incorporated into the bond because the bond did not specifically include a forum selection provision. It is plaintiffs position that the Louisiana statute is not controlling and that this Court, therefore, has jurisdiction in this diversity action.

The Louisiana Public Works Act was enacted to “protect persons doing work, performing labor or furnishing materials for the construction, erection, alteration or repair of * * * public works of any character.” La. Acts 1918, No. 224. The Act requires contractors performing work for the State or any political subdivision thereof to furnish a public works bond in the amount of no less than fifty percent of the contract price. The Act affords a “special remedy [to] a certain class of creditors for the concurrent enforcement of their claims and to regulate their rights as between themselves and against a contractor doing public work, and the surety on his bond.” Seal v. Gano, 160 La. 636, 107 So. 473 (1926).

La.R.S. 38:2243 provides in pertinent part:

“If at the expiration of the forty-five days and filed and recorded claims are unpaid, the governing authority shall file a petition in the proper court of the parish where the work was done, citing all claims and the contractor, subcontractor, and surety on the bond and asserting whatever claims it has against any of them, and shall require the claimants to assert their claims. If the governing authority fails to file the proceeding any claimant may do so.
“All the claims shall be tried in concursus and the claims of the claimants shall be paid in preference to the claims of the governing authority.” (Emphasis added.)

The purpose of this section was to provide a remedy to " * * * bring all parties concerned and having an interest together before one court and in one proceeding, to the end that their respective rights as between themselves and against the contractor and his surety might be recognized and adjusted.” Seal v. Gano, 107 So. at 475. The Louisiana legislature desired to prevent the multiplicity of suits that would arise when creditors enforced their individual claims against the principal and surety. The remedy created by § 2243 additionally enables all creditors to share ratably and in proportion to the amount of their respective claims in the common fund provided by the bond, therefore, eliminating the probability that some creditors would not recover because other creditors had exhausted the fund in prior suits.

Louisiana is not the only state to have enacted a bond statute that restricts the forum for suits to the state where the work was done. (See Appendix A, infra.) Plaintiff argues, however, that the Louisiana statute, unlike the Miller Act, 40 U.S.C. § 270b and other state statutes having forum restriction provisions, does not provide an exclusive procedure for recovery against the public works bond. It is pointed out that the other statutes use mandatory language, including the restrictive word “shall,” to proscribe the procedure for recovery, whereas the Louisiana statute provides that “ * * * any claimant may do so.” (Emphasis added.)

It is this Court’s opinion that plaintiff’s attempt to distinguish the Louisiana statute from other state statutes which provide forum restrictions on statutory public works bonds' is ill-conceived. The Louisiana Supreme Court in Seal v. Gano, supra, acknowledged that the purpose of the statute is to provide a “special” remedy for all parties concerned to adjudicate their respective rights in one proceeding. If plaintiff’s contentions are accepted as true, the statute’s effectiveness will be totally thwarted. Additionally, the statute provides that “[a]ll the claims shall be tried concursus * * A concursus action promotes the adjudication of all claimants’ rights in one proceeding, thereby eliminating multiplicity of suits and insuring that all claimants recover against the bonds. The procedure prescribed by the Louisiana statute is, therefore, found to be mandatory in light of Seal v. Gano, supra.

The next point which needs consideration is whether the special remedy created by the Louisiana Public Works Act restricts the jurisdiction of this Court in a diversity action. Plaintiff alleges that this Court has jurisdiction in the case at bar because all requisites of diversity have been met. “It is generally true that a transitory action * * * may be brought in any- court of competent jurisdiction where jurisdiction over the defendant can be obtained,” however, a local cause of action may be restricted to a particular jurisdiction. State ex rel. U.S. Fidelity and Guaranty Co. v. Mehan, 581 S.W.2d 837 (Mo.App.1979).

The Supreme Court implicitly recognized a state’s right to restrict a cause of action to a specific court in Tennessee Coal, Iron & R. Co. v. George, 233 U.S. 354, 34 S.Ct. 587, 58 L.Ed. 997 (1914) and Atchison, T. & S.F.R. Co. v. Sowers, 213 U.S. 55, 29 S.Ct. 397, 53 L.Ed. 695 (1909). In Tennessee Coal, supra, the Court held that a court was not obliged by the full faith and credit clause of the Constitution to give effect to a sister state’s statute, restricting the place of bringing suit to that state, where the cause of action created by that state is transitory. In Atchison, supra, the Supreme Court similarly held that a statutory cause of action created by the' Territory of New Mexico was transitory and, therefore, a federal court sitting in Texas was not required to adhere to the New Mexico statute’s forum restriction. Both Tennessee Coal and Atchison involved actions for personal injury characterized in Atchison as “universally held to be transitory.”

In Tennessee Coal, supra, the Court expressly recognized that an action is local where “the right and remedy are * * * so inseparably united as to make the right dependent upon its being enforced in a particular tribunal.” 233 U.S. at 359, 34 S.Ct. at 588. The Louisiana Public Works Act requires contractors, working on public works projects, to provide a bond “for the protection of [the State, Parish, city, town, village, public board or body having the work done], for the faithful performance of the contract and payment of all persons doing work, performing labor or furnishing materials therefor.” La. Acts 1918, No. 224. The Louisiana legislature has determined that the most effective manner for effectuating such protection is to require suit to be tried in concursus in the proper court of the parish where the work was done. As discussed previously, this limitation tends to maximize the convenience of the defendant, avoid multiplicity of suits and protect creditors. By allowing suits to be brought in jurisdictions other than the parish where the work was done, the defendant could be required to appear in any and all federal courts where personal jurisdiction over defendant could be obtained and where subject matter jurisdiction requirements are met. Additionally, one contractor’s default on a public works project could result in as many suits as there are claimants against the bond. Defendant has indicated that there may be as many as thirty-nine such claimants in this case. Finally, and most importantly, creditors would lose their right to recover against the bond once its funds were exhausted in prior suits. This Court, therefore, finds in accordance with the principles enunciated in Tennessee Coal, supra, that the cause of action created by the Louisiana Public Works Act is local in nature. This being the case, this Court does not have jurisdiction over the subject matter of the instant action.

Plaintiff argues that even if the jurisdictional limitation embodied in La.R.S. 38:2243 is found to be mandatory, the terms of that statute are not incorporated into the bond. In Orleans Parish School Bd. v. Pittman Const. Co., 244 So.2d 641 (La.App.1971), the Louisiana Court of Appeals stated:

“It is well settled that bonds furnished for public contracts are statutory bonds and the Court is required to look to the statute to find conditions of the bond, and whatever is written into the bond which is not required by the statute must be read out of the bond, and whatever is not expressed in it which ought to have been incorporated into the bond must be read into it, [Citations omitted].”
Id. at 642.

Plaintiff avers that Orleans Parish School Bd. does not reflect the current status of Louisiana law in that subsequent decisions of the Louisiana Supreme Court have not continued that construction of the Louisiana statute. For this proposition, plaintiff cites Construction Materials v. American Surety, 388 So.2d 365 (La.1980) and Valliant v. State Department of Louisiana, 437 So.2d 845 (La.1983).

In Construction Materials, supra, the court faced the issue of whether the Louisiana Public Works Act, La.R.S. 38:2241 et seq. limits who may recover under a contractor’s performance and payment bond where a surety company’s obligations, as specified in the bond, extend beyond those statutorily required. The court held that the Act does not prohibit a contractor’s surety from obligating itself to pay claims beyond those required, reasoning that § 2247 of the Act makes clear that the Act shall not be construed to deprive “any person * * * of his right of action on the contractor’s bond.” The court’s rationale supporting its holding is clearly contrary to plaintiff’s assertion that the court determined that prior construction given to the relationship of surety bonds to the statute requiring them were no longer to be applied. The decision in Construction Materials must only be read to hold that the Louisiana Public Works Act provides the minimum obligations a surety will incur on a public works bond. Plaintiff’s interpretation of that case would require that the terms of the bond dictate the rights of the creditors rather than the statute. This interpretation would thwart the purpose behind the statute.

The case at bar is also distinguishable from Construction Materials, supra, for two reasons. First, the Construction Materials decision was based on the construction of § 2247 of the Louisiana Public Works Act, whereas the present case involves § 2243 of the same Act. Second, the bond in the instant case does not make any reference to forum selection. Therefore, unlike Construction Materials, the bond’s terms do not conflict with the Act and this Court need not determine which provision is controlling. Additionally, it is unlikely that terms of a bond, abrogating the specific procedure contemplated by the Act, would be upheld because of the integral relationship of the statutory procedural remedy to the purposes of the Act.

Plaintiff’s reliance on Valliant v. State Department of Louisiana, supra, is similarly misplaced and does not need to be analyzed in detail. The holdings in Construction Materials and Valliant are limited to their factual settings and should not be extended to apply to the instant case.

In conclusion, this Court finds that the Louisiana Public Works Act, La.R.S. 38:2241 et seq. specifies a remedy for claims against a public works bond that is local in nature. § 2243 of that Act requires suits to be brought in concursus “in the proper court of the parish where the work was done.”

This Court is thereby precluded from asserting jurisdiction over the action at bar, and accordingly it is ordered that plaintiff’s action be dismissed for lack of jurisdiction, without prejudice, at plaintiff’s costs.

APPENDIX A

UNITED STATES

Miller Act 40 U.S.C. § 270b

“(b) Every suit instituted under this Section shall be brought * * * in the United States District Court for any district in which the contract was to be performed and executed and not elsewhere, irrespective of the amount in controversy in such suit * * * ”

ARKANSAS

Arkansas Stats. § 51-636

“SUIT ON CLAIMS AGAINST BOND.— All persons, firms, associations and corporations who have valid claims against the bond may bring an action thereon against the corporate surety, provided that no action shall be brought on said bond after six (6) months from the date final payment is made on the contract, nor outside the State of Arkansas. ”

CONNECTICUT

Connecticut Stats. § 49-42

“(b) Every suit instituted under this section shall be brought in the name of the person suing, in the superior court for the judicial district where the contract was to be performed, * * * ”

DISTRICT OF COLUMBIA

District of Columbia Stats. § 1-1105(b)

“(b) Every suit instituted under this section shall be brought in the name of the District of Columbia for the use of the person suing, In the Superior Court of the District of Columbia, irrespective of the amount in controversy in such suit, * * * ”

ILLINOIS

Ill.Rev.Stat. Ch. 29 § 16

“RECOVERY ON BOND — NOTICE OF CLAIM — LIMITATION * * * Such suit shall be brought only in the circuit of this State in the judicial district in which the contract is to be performed.”

IOWA

Iowa Stats. § 573.16

“OPTIONAL AND MANDATORY ACTIONS — BOND TO RELEASE The public corporation, the principal contractor, any claimant for labor or material who has filed his claim, or the surety on any bond given for the performance of the contract, may, at any time after the expiration of thirty days, and not later than sixty days, following the completion and final acceptance of said improvement, bring action in equity in the county where the improvement is located to adjudicate all rights to said fund, or to enforce liability on said bond. ”

MICHIGAN

Michigan Stats. § 129.209

“Sec. 9. An action instituted on the payment bond shall be brought only in the appropriate court in the political subdivision in which the contract was to be performed. ”

NEVADA

Nevada Stats. § 339.055

“ACTIONS ON PAYMENT BONDS: VENUE; LIMITATION OF ACTIONS

1. Every action on a payment bond as provided in NRS 339.035 shall be brought in the appropriate court of the political subdivision where the contract for which the bond was given was to be performed. ”

NEW YORK

New York Stats. Art. 9, State Finance § 137

“BOND TO SECURE PAYMENT OF CERTAIN CLAIMS ARISING FROM A PUBLIC IMPROVEMENT; ENFORCEMENT * # *

4. (a) A payment bond required pursuant to this section may provide that the place of trial of an action on the bond shall be in the county in which the contract of the contractor who furnished the bond was to be performed or if such contract was to be performed in more than one county, then in any such county, and not elsewhere. ”

OREGON

Oregon Stats. § 279.536

“ACTION BY CLAIMANT ON CONTRACTOR’S BOND

(1) A person who has filed and served the notice or notices of claim, as required under ORS 279.526 and 279.528, or his assignee, may institute an action on the contractor’s bond, cashier’s check or certified check as provided for in ORS 279.029 in the circuit court of this state or the federal district court of this district. ”

SOUTH DAKOTA

South Dakota Stats. § 5-21-6

“ACTION BY LABORER OR MATERIAL-MAN ON PUBLIC CONTRACTOR’S BOND — LIMITATION OF ACTION — INTERVENTION BY OTHER CLAIMANTS —COSTS. * * * the person supplying the contractor with labor or material shall * * be authorized to bring suit in the name of the public corporation in the circuit court of the county in which such contract was to be performed and not elsewhere, for his use and benefit, against such contractor and his surety, and to prosecute the same to final judgment; * * * ”

TENNESSEE

Tennessee Stats. § 54-5-119

“CONTRACTORS MUST GIVE BONDS— ACTIONS — LIMITATIONS All contractors with whom contracts are made by the bureau shall enter into good and solvent surety bond * * *.

All actions on bonds furnished under this section shall name the director of highways as a party-defendant and may be instituted in any court of competent jurisdiction in this state, * * * ”

TEXAS

Texas Stats. Chap. 4 Art. 5160 G

“G. All suits instituted under the provisions of this Act shall be brought in a court of competent jurisdiction in the county in which the project or work, or any part thereof, is situated.”

UTAH

Utah Stats. § 63-56-38(4)

“CLAIMS FOR LABOR OR MATERIAL FURNISHED — SUIT ON CONTRACTOR’S PAYMENT BOND — PROCEDURE — LIMITATION * * * “Any suit instituted upon a payment bond shall be brought in the district court of the county in which the construction contract was to be performed.” Every suit instituted on the aforesaid payment bond shall be brought in the appropriate court in the political sub-division in which the contract was to be performed and not elsewhere; * * * ”

VIRGINIA

Virginia Stats. § 11-23

“BONDS ON PUBLIC CONTRACTS TO WHICH COUNTY, CITY, TOWN, SCHOOL BOARD, OR AGENCY THEREOF, IS PARTY: CONDITIONS OF SUCH BONDS. * * *

Every action brought under this section shall be brought in a Virginia court of competent jurisdiction and the venue therefor shall be specified in subdivision 6 of § 8.01-261, or in the United States District Court for the district in which the project, or any part thereof, is situated, and not elsewhere.”


author: AUBREY E. ROBINSON, Jr., Chief Judge.

text:
    Hannelore M. JONES, Plaintiff, v. MARRIOTT CORPORATION, Defendant.
    Misc. Action No. 84-316.
    United States District Court, District of Columbia.
    March 19, 1985.

      Courtney B. Wheeler, Marriott Corp., Bethesda, Md., for defendant.
    T. Rodney Oppmann, Washington, D.C., for plaintiff.
   MEMORANDUM AND ORDER

AUBREY E. ROBINSON, Jr., Chief Judge.

Plaintiff in this action has filed an application for relief under 28 U.S.C. § 1875, which is designed to protect the employment of those summoned to serve either on petit or grand juries in any court of the United States. Defendant filed an opposition, to which plaintiff replied, and a hearing was held before this Court on February 21, 1985. In consideration of the evidence received and arguments of counsel, the Court finds that the plaintiff was coerced and concludes that the defendant is liable to plaintiff in the sum of $200.00 for expenses she was forced to incur.

A. Facts

Plaintiff, Hannelore M. Jones, was hired as a cashier by defendant, Marriott Corporation, to work in a dining facility it operated in the Saudi Arabian Embassy in Washington, D.C. Shortly after entering on the job, plaintiff underwent a routine orientation program for new employees and was given, among other orientation materials, a copy of a document that explained that defendant granted paid leave for all permanent employees who were summoned for jury duty. .

On July 15, 1984, only two weeks after she had started to work at Marriott, plaintiff received a summons for jury service to run from August 15, 1984 until August 31, 1984. She notified her direct supervisor, Dennis Pavelka, of the summons and he requested that plaintiff secure an extension of her jury service for one year, at which time she would have accumulated two weeks of vacation time. Mr. Pavelka further indicated that he would have to hire a replacement in plaintiff’s absence and that he “wouldn’t know what to do” with two cashiers. Mr. Pavelka failed to reiterate to plaintiff Marriott’s policy of granting to permanent employees paid leave for jury service and failed to offer to plaintiff any other assistance.

Fearing she would lose her job if she obeyed the summons, plaintiff sought advice of counsel. Plaintiff’s lawyer contacted James F. Davey, Clerk of the Court, to request a postponement for plaintiff of her jury duty. Plaintiff’s lawyer also met with Mr. Pavelka, who repeated his request that plaintiff wait until she had accumulated vacation time before she served on a jury. Shortly thereafter, plaintiff’s lawyer was informed by the Clerk of the Court that the request for a postponement of jury duty service had been approved and that Ms. Jones had been given a one year extension. Plaintiff’s lawyer billed her for legal services in the sum of $200.00, which she paid in installments. Through Mr. Pavelka she sought and was refused reimbursement. In September, 1984, plaintiff procured a higher paying job working nights. According to the testimony of Betty Snow, a friend and coworker of Ms. Jones, plaintiff was unable to work both jobs and decided to resign from the employ of Marriott Corporation, which she did in late September, 1984.

On October 26, 1984, plaintiff’s counsel contacted Marriott and demanded that defendant reimburse plaintiff in the sum of $200.00 in legal fees that had been paid by plaintiff for obtaining a deferrment of her jury service. Marriott responded on November 7, 1984, denying liability or illegality and refusing to settle. One week later, however, defendant offered to settle the case for $200.00, without admitting any liability. Plaintiff returned the check to defendant, stating that settlement could not be reached until defendant agreed also to resolve other alleged improprieties relating to plaintiffs job and Marriott Corporation practices. On December 10, 1984, plaintiff applied to this Court for relief pursuant to the Jury System Improvements Act of 1978, 28 U.S.C. § 1875.

B. Analysis

28 U.S.C. § 1875 provides in pertinent part that “[n]o employer shall discharge, threaten to discharge, intimidate, or coerce any permanent employee by reason of such employee’s jury service or the attendance or scheduled attendance in connection with such service, in any court of the United States.” The statute provides for damages, attorney’s fees, a civil penalty and an injunction by way of sanctions for violations under the statute.

The facts found by the Court in this action lead the Court to conclude that Marriott Corporation, through its agent Dennis Pavelka, violated the provisions of 28 U.S.C. § 1875. Marriott had a duty to ensure that plaintiff was aware that she could report for jury duty without fear of reprisal and with full pay. Marriott attempted so to inform her through the orientation documents distributed to her upon her arrival at Marriott, but Pavelka failed to reiterate this policy when it was of most use to plaintiff. Rather, he asked her to postpone her service until she had accrued vacation time and at the very least implied that if she reported for jury service she may not have a job to which she could return. This action on the part of the employer is sufficient in the Court’s view to establish that Marriott “coerced” the plaintiff into unnecessarily hiring an attorney in order to protect her employment. See In re Grand Juror Ronnie Webb, 586 F.Supp. 1480 (N.D.Ohio 1984). See also Wiskotoni v. Michigan National Bank-West, 716 F.2d 378 (6th Cir.1983).

In addition, the Court awards to plaintiff $200.00 in attorney’s fees, as provided by the statute. The Court concludes that the other claims for relief prayed for in the application are without merit and therefore are denied.