author: KANE, District Judge.

text:
    Chris L. BOREN, By and Through his next best friends and parents, James BOREN and Toni Boren, James Boren and Toni Boren, Plaintiffs, v. CITY OF COLORADO SPRINGS, a Municipal corporation, Neal Stratton, Chief of Police, City of Colorado Springs, Officers Cecil E. Hutcheson, Jerry Lee Steckler, and Michael W. Grys, City of Colorado Springs Police Department, other unknown officers and supervisors of the City of Colorado Springs Police Department, Defendants.
    Civ. A. No. 85-K-1643.
    United States District Court, D. Colorado.
    Dec. 31, 1985.

      Robert C. Erler, Barash & LeHouillier, Colorado Springs, Colo., for plaintiffs.
    Gary R. Cowan, Colorado Springs, Colo., for defendants.
   ORDER OF DISMISSAL

KANE, District Judge.

This civil rights action, filed against three Colorado Springs police officers, the City of Colorado Springs, the chief of police, and other unknown officers and supervisors, is brought pursuant to 42 U.S.C. §§ 1983 and 1988. Jurisdiction lies under 28 U.S.C. §§ 1343 and 1331. Plaintiffs seek monetary damages for alleged deprivation of Chris Boren’s constitutional rights.

Defendants have moved to dismiss the complaint for failure to state a claim upon which relief can be granted. They argue that none of the allegations amount to a violation of plaintiff Chris Boren’s constitutional rights. They also maintain that the court should decline to exercise jurisdiction over counts two and three under the doctrine of pendent jurisdiction, and that the claims of negligence against the City of Colorado Springs are not actionable under 42 U.S.C.' § 1983.

I.

Background

The amended complaint alleges that on January 25, 1985, about 9:00 p.m., Chris Boren left a store with a can of soda in his hand and drove off on his three-wheeled motorcycle. Three police officers in an unmarked police van pursued him without identifying themselves and without probable cause. When plaintiff, saw a marked, unoccupied police cruiser parked in front of a house, he ran up to the front porch in an attempt to find the police officer. When he saw one of the officers, dressed in civilian clothes, step out of the van, he jumped over the porch in fear, injuring his left knee and left leg.

The first cause of action asserts that the acts of the officers in chasing Chris Boren without identifying themselves and without probable cause violate his constitutional rights. Plaintiffs also charge that the failure of the city, chief of police, and supervisors properly to train and select police officers and establish procedures and guidelines caused the violation of Chris Boren’s constitutional rights. The second cause of action charges (1) that all defendants were negligent in not using reasonable care before the initiation of the chase, and (2) that all defendants except the three officers were negligent in not establishing the proper guidelines, training, and supervision for police officers which could have prevented Chris Boren’s injuries. The third cause of action complains that the three officers, in chasing and harassing plaintiff Chris Boren, acted in willful and wanton disregard of his rights and feelings. Plaintiffs seek compensatory damages of $500,000.00 and punitive damages in a like amount.

II.

Plaintiffs’ § 1983 Claims

The complaint attempts to set forth both § 1983 claims (in the first cause of action) and negligence claims (in the second cause of action) against all parties. The § 1983 claim against the three named officers centers around the chase. The § 1983 claim against the City of Colorado Springs, the chief of police, and the supervisors, alleges they are responsible for the selection and training of the three named officers and that they were in a position to establish procedures and guidelines which could have been utilized to prevent violation of plaintiff Chris Boren’s constitutional rights. I must examine the § 1983 claims against each defendant to determine whether any claims can withstand defendants’ motion to dismiss.

A § 1983 claim should not be dismissed unless it clearly appears that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. See Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957); Kennedy v. Meacham, 540 F.2d 1057, 1060 (10th Cir.1976); Holder v. Claar, 459 F.Supp. 850, 852 (D.Colo.1978); Smith v. Ricker, No. 82-K-1499 (D.Colo. July 11, 1984) (Kane, J.). Two elements are required to state a claim for relief under § 1983: (1) the defendant acted under color of state law, and (2) the defendant’s actions deprived the plaintiff of some right, privilege or immunity secured by the constitution or the laws of the United States. See Wise v. Bravo, 666 F.2d 1328, 1331 (10th Cir.1981).

A. , Plaintiffs § 1983 claims against the three named officers.

Defendants do not dispute that the three named officers were acting in their capacity as Colorado Springs police officers. Thus, the first element for a § 1983 claim is met. Defendants maintain, however, that plaintiff was not deprived of any right secured by the constitution or laws of the United States.

The gist of plaintiffs’ complaint is repeated in their written response to the defendants’ motion to dismiss, viz., that certain officers, “in an unmarked van, without a warrant, without probable cause, without identifying themselves, stalked, chased, blocked the path of the Defendant (sic), and by their actions put the Defendant (sic) in fear of his life, which caused him to flee and to seek help from another police officer, and in doing so the Defendant (sic) fell and injured himself seriously.” Even as stated, and taking the allegations as true and in a light most favorable to the plaintiffs as I am obliged to do, it is obvious that the proximate cause of Chris Boren’s injuries was his fall from a porch which was caused by his flight from a situation in which he became frightened. It is stated that he became frightened because of the actions of the police officers. As best I am able to determine, the plaintiffs are asserting that a minor child has the constitutional right not to be put in fear by the actions of police officers; that Chris Boren was so put in fear and that he suffered injuries as a result thereof. There are no allegations of contact, assault or battery.

In Baker v. McCollan, 443 U.S. 137, 99 S.Ct. 2689, 61 L.Ed.2d 433 (1979), the Supreme Court made two points which have endured beyond its decision in Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981). First, the threshold question in § 1983 cases is whether a Fourteenth Amendment violation exists. Second, § 1983 creates no new substantive rights; it simply augments the enforcement of the Fourteenth Amendment.

The Fourteenth Amendment protects against deprivation of life, liberty, or property without due process of law. Although the Supreme Court has never attempted to define with exactness the term “liberty,” the case law has summarized a variety of interests which can be characterized as liberty interests. See generally Annot., 47 L.Ed.2d 975 (1976). It is settled that the liberty interest protected by the Fourteenth Amendment is not limited to freedom from physical or bodily restraint, and includes liberty of mind as well as liberty of action. Id. at 982 (citing Benton v. Maryland, 395 U.S. 784, 89 S.Ct. 2056, 23 L.Ed.2d 707 (1969). For example, the freedom to go about one’s business is a liberty interest protected by the Constitution. See Shapiro v. Thompson, 394 U.S. 618, 629-30, 89 S.Ct. 1322, 1328-29, 22 L.Ed.2d 600 (1969). Perhaps the most expansive view of liberty is set forth in Meyer v. Nebraska, 262 U.S. 390, 43 S.Ct. 625, 67 L.Ed. 1042 (1923):

Without doubt, it denotes not merely freedom from bodily restraint but also the right of the individual to contract, to engage in any of the common occupations of life, to acquire useful knowledge, to marry, establish a home and bring up children, to worship God according to the dictates of his own conscience, and, generally to enjoy those privileges long recognized at common law as essential to the orderly pursuit of happiness by free men.

262 U.S. at 399, 43 S.Ct. at 626, 67 L.Ed. at 1045.

The Supreme Court, however, has not sanctioned indiscriminate expansion of the scope of § 1983 actions. In Paul v. Davis, 424 U.S. 693, 96 S.Ct. 1155, 47 L.Ed.2d 405 (1976), the Court cautioned:

[Plaintiff] apparently believes that the Fourteenth Amendment’s Due Process Clause should ex proprio vigore extend to him a right to be free of injury wherever the State may be characterized as the tortfeasor. But such a reading would make of the Fourteenth Amendment a font of tort law to be superimposed upon whatever systems may already be administered by the States. We have noted the “constitutional shoals” that confront any attempt to derive from congressional civil rights statutes a body of general federal tort law, [citation omitted]; a fortiori the procedural guarantees of the Due Process Clause cannot be the source for such law.

Id. at 701, 96 S.Ct. at 1160.

It is undisputed that a plaintiff must point to “some specific constitutional guarantee safeguarding the interest he asserts has been invaded.” Paul v. Davis, 424 U.S. at 700, 96 S.Ct. at 1160, 47 L.Ed.2d at 413. Of course, the issue of whether the three police officers were reasonable in pursuing plaintiff may very well be decided in a state caúsé of action for negligence, but there is no overwhelming reason why a federal court should be involved. I have searched the case reports and did not find a single case, nor was one cited to me by the parties, which supports plaintiffs’ contention that a Fourteenth Amendment violation occurred.

It is not necessary in this case to venture into the uncertainties in the relationship between negligence and § 1983 liability. In Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981), Justice Rehnquist indicated that negligence can be actionable under § 1983, but only when it is relevant to the constitutional violation asserted. He concluded that the due process clause was not violated by the defendants’ conduct. For one thing, there was an adequate tort remedy under state law which the plaintiff could use to seek redress for his loss of property. For another, the plaintiff’s loss was not caused by a formal and established procedure, but rather by “random and unauthorized” acts of state employees. Justice Rehnquist emphasized that this due process result was sensible. Otherwise, every injury caused by a state official under color of state law would constitute a due process violation thereby rendering § 1983 a “font of tort law.”

Closer to this case is Judge Logan’s opinion in Major v. Benton, 647 F.2d 110 (10th Cir.1981). That case involved an inmate’s death resulting from alleged negligence by prison officials in failing to formulate safety measures and safe conditions for digging a ditch. I quote from Judge Logan’s opinion at length:

Analogizing from Baker v. McCollan, it is clear that a death resulting from the negligent action of a state official does not in itself raise a constitutional claim. In Paul v. Davis, 424 U.S. 693, 96 S.Ct. 1155, 47 L.Ed.2d 405 (1976), plaintiff claimed that the circulation of his photograph by police as a potential shoplifter deprived him of his liberty without due process of law. The Supreme Court noted that if this postulate were accepted “it would be very difficult to see why the survivors of an innocent bystander mistakenly shot by a policeman or negligently killed by a sheriff driving a government vehicle, would not have claims equally cognizable under § 1983.” 424 U.S. at 698, 96 S.Ct. at 1159. It quoted with approval Justice Douglas’ observation in Screws v. United States, 325 U.S. 91, 65 S.Ct. 1031, 89 L.Ed. 1495 (1945), that although a prisoner has been assaulted or even murdered by state officials it does not necessarily mean he has been deprived of any constitutional rights. 424 U.S. at 699, 96 S.Ct. at 1159. The Court held that the Due Process Clause does not extend a right to be free from the torts of state officials. Instead, specific constitutional guarantees must be implicated to give rise to due process protection. 424 U.S. at 700-02, 96 S.Ct. at 1160-61.

Id. at 113.

. It is not, of course, up to me to make law or determine policy. Under some circumstances negligence can trigger a § 1983 violation; under others intent is required and, under some, state of mind is wholly immaterial. .My reading of the authorities leads me to conclude that some kind of conduct must be a cause of a constitutional violation and that while specific intent to deprive one of a constitutional right is never required, there must be a nexus between the wrong done and the purpose for which the statute was intended. The statute was enacted, according to Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961), overruled by Monell v. Department of Social Services of City of New York, 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978), because of the lack of enforcement by states of Fourteenth Amendment rights because of prejudice, intolerance, neglect or otherwise. Clearly, its intent was not to extend federal jurisdiction to every tort committed by any state official. Defendants’ motion to dismiss for failure to state a claim under § 1983 is granted.

B. Plaintiffs’ § 1983 claims against the City of Colorado Springs and the Police Department.

The city’s police department is merely a vehicle through which the city government fulfills its policing functions and is not a proper party defendant. See, e.g., Martinez v. Winner, 771 F.2d 424 (10th Cir.1985); Shelby v. City of Atlanta, 578 F.Supp. 1368 (N.D.Ga.1984). The police department, therefore, is dismissed from the case.

In examining plaintiffs’ § 1983 claim against the city, we begin with the same two elements discussed above: (1) the defendant acted under color of state law; and (2) those actions deprived plaintiff of some right secured by the constitution or laws of the United States. As with the three police officers, the first element is undisputed; the city was acting under color of state law.

The liability of municipalities and supervisors, however, requires a more detailed analysis than the liability of the offending officers in this case. The courts have developed various approaches to standards for § 1983 liability. The various approaches all require the initial proof that there has been a deprivation of a plaintiff’s constitutional right; the failure to meet that requirement has already been addressed in the section regarding § 1983 liability of the officers. Nonetheless, I think it is important to rule on the issues implicit in the concept of vicarious liability.

The Supreme Court has made it clear that municipal liability cannot be premised on the mere fact that a municipality employs an offending official or on theories akin to respondeat superior. Municipal liability can be imposed only if the injuries are inflicted pursuant to government “policy or custom.” Monell v. New York City Department of Social Services, 436 U.S. 658, 694, 98 S.Ct. 2018, 2037, 56 L.Ed.2d 611 (1978). The addition of this requirement that the policy be “the moving force of the constitutional violation,” id. at 694, 98 S.Ct. at 2038, is the critical additional factor in determining municipal liability under § 1983.

Even the Supreme Court, however, has had difficulty in defining the term “policy,” as evidenced by City of Oklahoma City v. Tuttle, — U.S. -, 105 S.Ct. 2427, 85 L.Ed.2d 791 (1985):

To establish the constitutional violation in Monell no evidence was needed other than a statement of the policy by the municipal corporation, and its exercise; but the type of “policy” upon which the respondent relies, and its causal relation to the alleged constitutional violation, are not susceptible to such easy proof. In the first place, the word “policy” generally implies a cause of action consciously chosen from among various alternatives; it is therefore difficult in one sense even to accept the submission that someone pursues a “policy” of “inadequate training,” unless evidence adduced which proves that the inadequacies resulted from conscious choice — that is, proof that the policymakers deliberately chose a training program that would prove inadequate. And in the second place, some limitation must be placed on establishing municipal liability through policies that are not themselves unconstitutional____ At the very least there must be an affirmative link between the policy and the particular constitutional violation alleged.

— U.S. at-, 105 S.Ct. at 2436.

Although the Supreme Court left no doubt regarding the affirmative link requirement, “there may be many ways of proving the existence of a municipal policy or custom that can cause a deprivation of a constitutional right.” Tuttle, — U.S. at -, 105 S.Ct. at 2441 (Brennan, J., concurring). A policy can be implied from the city's actions or inactions before the alleged misconduct took place, although “the scope of § 1983 liability does not permit such liability to be imposed merely on evidence of the wrongful actions of a single city employee not authorized to make city policy.” Id. See also Rymer v. Davis, 754 F.2d. 198, vacated — U.S. -, 105 S.Ct. 3518, 87 L.Ed.2d 646, affirmed on remand, 775 F.2d 756 (6th Cir.1985). A custom or policy may include a municipality’s failure to train, supervise, or discipline its police force. Varela v. Jones, 746 F.2d 1413, 1418 (10th Cir.1984). Monell also indicated that a custom may be inferred when gross negligence in the training of a police force is found, as long as the causal relationship between the failure to train and the conduct of police officers is demonstrated. See Rymer v. Davis, 754 F.2d at 201; Leite v. Providence, 463 F.Supp 585, 590-91 (D.R.I.1978).

The majority opinion in Tuttle has thrown into doubt whether harm allegedly caused by gross negligence in training can meet § 1983’s standard of causation. Oklahoma v. Tuttle, — U.S. -, 105 S.Ct. 2427. As the majority states in that case:

We express no opinion on whether a policy that itself is not unconstitutional, such as the general “inadequate training” alleged here, can ever meet the “policy” requirement of Monell. In addition, even assuming that such a “policy” would suffice, it is open to question whether a policymaker’s “gross negligence” in establishing police training practices could establish a “policy” that constitutes a “moving force” behind subsequent unconstitutional conduct, or whether a more conscious decision on the part of the policymaker would be required.

Id. at-, n. 7, 105 S.Ct. at 2436, n. 7. After careful analysis of Tuttle, the First Circuit, in a chase culminating in a shooting death, has considered whether lack of guidance for undertaking an automobile chase provides evidence showing a policy of inadequate training. The case, however, involved ten officers and three separate shootings. The court laid heavy emphasis on the widespread activity which distinguished this case from Tuttle. See Kibbe v. City of Springfield, 777 F.2d 801 (1st Cir.1985).

An official policy can be inferred from a municipality’s omissions as well as from its acts. Wellington v. Daniels, 717 F.2d 932 (4th Cir.1983). It can be inferred, for example, where officials had knowledge of a pattern of constitutionally offensive acts by subordinates but failed to take remedial steps. Turpin v. Mailet, 619 F.2d 196 (2nd Cir.) cert. denied 449 U.S. 1016, 101 S.Ct. 577, 66 L.Ed.2d 475 (1980). Such omissions, however, are actionable only if they constitute “deliberate indifference” or “tacit authorization” of constitutional injuries. Id. at 202. See also Lenard v. Argento, 699 F.2d 874 (7th Cir.1983), cert. denied 464 U.S. 815, 104 S.Ct. 69, 78 L.Ed.2d 84 (1983); Popow v. City of Margate, 476 F.Supp. 1237 (D.N.J.1979); Smith v. Ambrogio, 456 F.Supp. 1130, 1136 (D.Conn.1978). In effect, the misconduct is such cases is ratified.

Where a municipality completely fails to train its police force or trains its officers in a reckless or grossly negligent manner such that police misconduct is almost inevitable, some courts have found an implicit authorization of § 1983 violations. See, e.g., Leite v. Providence, 463 F.Supp. 585 (D.R.I.1978). The courts are generally agreed, however, that inaction or failure to train requires a higher standard than mere negligence in order to meet the § 1983 requirements. Mere failure by a municipality to supervise its employees does not set forth a cause of action under § 1983, unless such failure is so severe as to reach a level of gross negligence or deliberate indifference to plaintiffs constitutional rights. Owens v. Haas, 601 F.2d. 1242 (2nd Cir.), cert. denied 444 U.S. 980, 100 S.Ct. 483, 62 L.Ed.2d 407 (1979). See also Grandstaff v. City of Borger, Texas, 767 F.2d 161 (5th Cir.1985).

In Grandstaff, the Fifth Circuit specifically addressed the question of inadequate training as cause of the constitutional violation and “doubt[ed] that a finding of ‘gross’ negligence in that training will always be the ticket to municipal liability.” Id. at 170. In the next section of its opinion, however, the court addressed the affirmative link question from a different angle:

(b) The city policy/custom of dangerous recklessness: If there is a reckless disregard for human life and safety prevalent among the city’s police officers which threatens the life and security of those whom they encounter, and if that recklessness is attributable to the instruction or example or acceptance of or by the city policymaker, the policy itself is a repudiation of constitutional rights. Where police officers know at the time they act that their use of deadly force in conscious disregard of the rights and safety of innocent third parties will meet with the approval of city policymakers, the affirmative link/moving force requirement is satisfied.

Id. The Grandstaff court, while uncertain about liability based on gross negligence, held that where “[cjonscious indifference to widespread incompetence or misbehavior [is] more than a matter of extreme negligence and more than a failure to instruct or train,” liability should be imposed. Id.

It is apparent that the courts have not reached agreement on the imposition of Monell liability. It is incumbent upon a pleader to show that some standard can be met. Plaintiffs’ claim, however, alleges only that the city is liable in failing properly to train, supervise, and establish guidelines for its police officers, which omission caused plaintiffs’ constitutional rights to be violated. Mere negligence is not enough. Where a constitutional violation is not alleged to be part of a pattern of past conduct, a supervisor or a municipality may be held liable only where there is essentially complete failure to train a police force, or training so grossly negligent that future misconduct is almost inevitable. Hays v. Jefferson County, Kentucky, 668 F.2d 869 (6th Cir.), cert. denied 459 U.S. 833, 103 S.Ct. 75, 74 L.Ed.2d 73 (1982); Owens v. Haas, 601 F.2d 1242 (2nd Cir.), cert. denied 444 U.S. 980, 100 S.Ct. 483, 62 L.Ed.2d 407 (1979). Further, it clearly appears from the allegations made that plaintiffs can prove no set of facts which would entitle them to relief against the City of Colorado Springs. For this reason, as well as plaintiffs’ failure to prove the violation of a constitutional right, the motion to dismiss plaintiffs’ claims against the city is granted.

C. Plaintiffs’ § 1983 claims against the police chief and supervisors.

Plaintiffs claim that the supervisors of the three named officers breached a duty to plaintiff Chris Boren, which breach was the proximate cause of his injuries, and, therefore, this § 1983 action may be maintained against the supervisors. Generally, liability of supervisors and police chiefs under § 1983 requires the same causation as municipal liability, but the causation need not be due to a “policy or custom.” “The law clearly allows actions against supervisors under section 1983 as long as a sufficient causal connection is present and the plaintiff was deprived under color of law of a federally secured right.” McClelland v. Facteau, 610 F.2d 693 (10th Cir. 1979).

Plaintiffs must provide some evidence of an “affirmative link” between the misconduct complained of and any action by officials. Id. at 696. As discussed above, there are several ways to demonstrate the “affirmative link.” Some courts have required that the causal link between official inaction and a constitutional violation “be established from the fact that the subordinate’s actions are an implementation of policies or practices endorsed by the supervisor.” Wilkinson v. Ellis, 484 F.Supp. 1072, 1086 (E.D.Pa.1980) (citation omitted). Others have held that if the police chief or the supervisors failed to perform some duty, and that failure caused the deprivation of a protected right, plaintiffs may recover on their § 1983 claim against the supervisors and police chief. See Dewell v. Lawson, 489 F.2d 877 (10th Cir.1974) (cause of action under § 1983 was stated when a complaint alleged the chief of police was liable because of his failure to establish proper procedures or adequately train or supervise personnel, which failure led to the deprivation of plaintiff’s constitutional right); Soto v. City of Sacramento, 567 F.Supp. 662 (E.D.Cal.1983) (a police chief’s liability in a case alleging excessive force by police officers centered around the chief’s alleged failure to train officers in the use of dogs).

At a minimum, a plaintiff must show that the official at least implicitly authorized, approved, or knowingly acquiesced in the unconstitutional conduct of the offending officers. Lenard v. Argento, 699 F.2d 874 (7th Cir.1983); Kite v. Kelley, 546 F.2d 334 (10th Cir.1976). If the defendant was in a position of responsibility, knew or should have known of the misconduct, and yet failed to act to prevent future harm, a cause of action would be stated under § 1983. McClelland v. Facteau, 610 F.2d 693 (10th Cir.1979). A supervisor or police chief, however, is not an insurer of liability for those under his command.

Again, plaintiffs' allegations against the supervisors and police chief are insufficient as a matter of law. The complaint against the police chief and supervisors is dismissed.

III.

Plaintiffs’ Negligence and Punitive Damages Claims

The second cause of action complains that (a) all defendants were negligent insofar as they did not use reasonable care before initiating the chase, and (b) that the supervisors, police chief, police department, and city were negligent in not establishing the proper guidelines, training, and supervision to prevent injuries to plaintiff Chris Boren. The substance of this charge of failure to train is very similar to the first cause of action, but it is couched in terms of negligence rather than a § 1983 violation. The allegations amount to nothing more nor less than state law negligence claims.

When a federal court’s subject matter jurisdiction is based upon a federal question, the court possesses the power to exercise pendent jurisdiction over state law claims if two conditions are met. First, “[t]he federal claim must have substance sufficient to confer subject matter jurisdiction on the court.” Second, “[t]he state and federal claims must derive from a common nucleus of operative facts, ... such that [plaintiff] would ordinarily be expected to try them all in one judicial proceeding.” United Mine Workers v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 1138, 16 L.Ed.2d 218 (1966). See also Garcia v. Wyckoff, 615 F.Supp. 217 (D.Colo.1985); Christiansen v. Phelan, 607 F.Supp. 470 (D.Colo. 1985).

In this case, the first condition for pendent jurisdiction is not met. Because the federal statutory claims are dismissed, there is no basis for pendent jurisdiction over plaintiffs’ state negligence claims. Further, because of probable jury confusion, I would not be inclined to exercise pendent jurisdiction even if there were a viable federal claim. The state claims are properly addressed in a state court. Plaintiffs’ second cause of action, therefore, is dismissed.

The third cause of action seeks punitive damages for defendants’ willful and wanton disregard for the rights and feelings of plaintiffs. Punitive damages are allowed in § 1983 actions. In this case, however, there is no § 1983 action in which punitive damages can be recovered. Plaintiffs’ third cause of action is dismissed.

It is therefore ORDERED that:

1) defendants’ motion to dismiss plaintiffs’ first cause of action for failure to state a claim under § 1983 is granted;

2) plaintiffs’ second cause of action is dismissed under the doctrine of pendent jurisdiction; and

3) plaintiffs’ third cause of action is dismissed.

      . 42 U.S.C. § 1983 provides:
      Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State ..., subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress____
      By its terms, of course, the statute creates no substantive rights; it merely provides remedies for deprivations of rights established elsewhere.

      . 42 U.S.C. § 1988 provides for attorney fees in civil rights cases brought to enforce the 14th Amendment.

      . Section 1 of the Fourteenth Amendment provides in pertinent part:
      nor shall any State deprive any person of life, liberty, or property, without due process of law;

      . Shapiro held that there was no need to ascribe the source of the right to travel throughout the land, without interruption, to a particular constitutional provision.

      . The majority was comprised of four Justices, Justices Rehnquist, Burger, White, and O’Con-nor. (Justices Brennan, Marshall and Black-mun concurred in part with the majority opinion, and concurred in the judgment.)


source: Caselaw Access Project

author: MOYE, Chief Judge.

license: Public Domain

text:
    PSYCHOLOGICAL RESOURCES SUPPORT SYSTEMS, INC., Plaintiff, v. Maurice R. GERLEMAN, Psychological Systems, Inc., Defendants.
    Civ. A. No. C85-3541A.
    United States District Court, N.D. Georgia, Atlanta Division.
    Dec. 31, 1985.
    James B. Middleton, Decatur, Ga., for plaintiff.
    Anne S. Infinger, Arnold, Golden & Gregory, Atlanta, Ga., Michael A. O’Neil, Herbert J. Hammond, Gardere & Wynne, David H. Judson, Dallas, Tex., for defendants.
   ORDER

MOYE, Chief Judge.

The plaintiff’s suit, seeking monetary and injunctive relief for copyright infringement and for unfair competition is here on the defendants’ motion to dismiss for lack of personal jurisdiction and improper venue pursuant to Federal Rule of Civil Procedure 12(b)(2) and (3). The defendants are Maurice R. Gerleman, a citizen of Texas, and Psychological Systems, Inc. (“PSI”), which is incorporated in Delaware and has its principal place of business in Dallas, Texas. The plaintiff invokes the jurisdiction of this Court under 28 U.S.C.A. § 1330(a), (b) (West 1976).

I. Factual background

In mid-1982, Mr. Gerleman met Dr. David G. Hubbard in Dallas, Texas. Dr. Hubbard at that time owned a company named Personality Profiles, Inc., which was doing business in Dallas providing computerized psychological testing services. The testing services included the administration of a battery of standardized psychological tests and the processing of those tests by a computer software program to generate a clinical-language narrative.

This test battery was developed and used primarily in clinical applications. Mr. Gerleman determined that if a nonclinical language narrative could be generated from the test battery, then computerized psychological testing services could be successfully marketed to the business community at large. Mr. Gerleman incorporated PSI in July 1983 with the intention of offering computerized psychological testing services to the business community.

Mr. Gerleman learned that Dr. Herbert Eber, of the plaintiff, had done some development work on the computer software program used by Personality Profiles, Inc. to process the test battery. On August 12^ 1983, Mr. Gerleman traveled to Atlanta, Georgia to meet Dr. Eber for the purpose of discussing his plans to provide computerized psychological testing services to the business community through PSI. Mr. Gerleman was accompanied on this visit by Ms. Joanne Borger, who assisted him in his negotiations there and who later incorporated PSI. The parties’ versions of what went on at this meeting differ.

After returning to Dallas, Mr. Gerleman began negotiating with Dr. Hubbard for the acquisition of the assets of Personality Profiles, Inc. On August 24, 1983, Dr. Hubbard and Mr. Gerleman executed an “Agreement for Purchase and Sale of Assets” in Dallas under which PSI acquired certain assets and rights and also assumed certain obligations of Personality Profiles, Inc.

It is undisputed that PSI sent two checks to the plaintiff in 1983. The plaintiff characterizes these as “royalty” payments. It is further undisputed that PSI received certain other services from the plaintiff, which the plaintiff describes as characteristic of its services for other licensees of its copyrighted software program. Some time after PSI’s acquisition of Personality Profiles, Inc., which had apparently leased the computer program in question, the plaintiff obtained a copyright registration on this software.

II. Personal jurisdiction

(a) Waiver

As a preliminary matter, the plaintiff argues that the defendants have, by failing to answer the complaint within twenty days of the date of service of the complaint, waived any objection to venue. This argument is meritless. The twenty-day period for serving an answer, and thus for serving a motion under Rule 12, begins on the date the acknowledgement of service is signed. Madden v. Cleland, 105 F.R.D. 520, 525 (N.D.Ga.1985). The acknowledgement of service in this action was executed on August 2, 1985, and the defendants’ motion to dismiss was timely filed twenty days thereafter.

(b) The foreign tort

This Court may exercise personal jurisdiction over a nonresident defendant to the extent permitted under the Georgia long-arm statute, O.C.G.A. § 9-10-91 (Supp. 1985). Hayes v. Irwin, 541 F.Supp. 397, 416-17 (N.D.Ga.1982), aff'd, 729 F.2d 1466 (11th Cir.), cert. denied, — U.S. -, 105 S.Ct. 185, 83 L.Ed.2d 119 (1984). In addition, the nonresident defendant must have established such minimum contacts with the forum that the exercise of jurisdiction is consistent with traditional notions of fair play and substantial justice. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. 286, 300, 100 S.Ct. 559, 568, 62 L.Ed.2d 490 (1980). The plaintiff must allege the jurisdictional prerequisites. If these allegations are controverted, the “plaintiff has the burden of going forward with sufficient factual evidence to establish a prima facie showing of the jurisdictional allegations.” National Egg Co. v. Bank Leumi le-Israel B.M., 504 F.Supp. 305, 309 (N.D.Ga.1980).

The claims alleged sound in tort. Porter v. United States, 473 F.2d 1329, 1337 (5th Cir.1973) (copyright infringement); Donsco, Inc. v. Casper Corp., 587 F.2d 602, 606 (3rd Cir.1978) (unfair competition). Subsection (1) of the Georgia long-arm statute applies only to claims based on contract and not those sounding in tort. Lutz v. Chrysler Corp., 691 F.2d 996, 997 (11th Cir.1982) (relying on Whitaker v. Krestmark of Alabama, Inc., 157 Ga.App. 536, 537-38, 278 S.E.2d 116 (1981)). When the claims sound in tort, jurisdiction must be premised upon subsections (2) or (3) of the long-arm statute, and the court seeking to exercise personal jurisdiction must satisfy three requirements:

(1) The nonresident must purposefully avail himself of the privilege of doing some act or consummating some transaction with or in the forum. It is not necessary that the defendant or his agent be physically within the forum, for an act or transaction by mail may suffice. A single event may be a sufficient basis if its effects within the forum are substantial enough to qualify under Rule 3; (2) The plaintiff must have a legal cause of action against the nonresident, which arises out of, or results from, the activity or activities of the defendant within the forum; and (3) If (and only if) the requirements of Rules 1 and 2 are established, a ‘minimum contact’ between the nonresident and the forum exists; the assumption of jurisdiction must be found to be consonant with the due process notions of ‘fair play’ and ‘substantial justice.’ In other words, the exercise of jurisdiction based upon the ‘minimum contact’ must be ‘reasonable.’

Shellenberger v. Tanner, 138 Ga.App. 399, 404-05, 227 S.E.2d 266 (1976).

The defendants neatly summarize the various “contacts” allegedly supporting the assertion of personal jurisdiction here: (1) Mr. Gerleman’s visit to Atlanta for the “sole purpose of negotiating a license agreement” (plaintiff’s response, filed September 4, 1985, at 10); (2) the license agreement allegedly entered into in Georgia (Eber Affidavit ¶ 16); (3) the defendants’ payment of “royalty checks” to the plaintiff in Georgia (plaintiff’s response, supra, at 11); (4) Ms. Borger’s alleged solicitation of business on behalf of PSI from Fuqua Industries in Atlanta (Borger Affidavit ¶ 17); (5) the mailing of a card reader to Georgia for repair (plaintiff’s response, supra, at 12); and (6) the alleged providing of supplies and continued technical assistance to PSI following its acquisition of Personality Profiles, Inc. (Morrow Affidavit n 8-9).

It is apparent that the defendants had numerous contacts with the forum. It is undisputed that at one point Mr. Gerleman was physically present within the forum in his capacity as representative for PSI. Although the parties disagree on the purpose of Mr. Gerleman’s visit, the Court holds that this and other contacts with the forum were sufficient to permit the exercise of jurisdiction over PSI.

Much of the defendants’ argument in opposition to this holding rests on the imagined distinction between subsections (2) and (3) of the long-arm statute. The defendants’ own authorities suggest that no substantial distinction exists between the two subsections. Because of a judicial gloss on the statute, a tort committed outside the state will suffice to confer jurisdiction under subsection (2), even though its language refers to a tort committed within the state. Shellenberger, 138 Ga.App. at 409-10, 227 S.E.2d at 271. The requirements of subsection (3), i.e., that the tortfeasor who commits a “tortious injury in this state caused by an act or omission outside this state ... regularly does or solicits business, or engages in any other persistent course of conduct, or derives substantial revenue from goods used or consumed or services rendered in this state ____”, are obviously narrower than those of subsection (2), which imposes no such restrictions. O.C.G.A. § 9-10-91(3). The similarity between the two sections does not, as the defendants suppose, mean that the restrictions of subsection (3) are to be imposed on subsection (2).

The fact that jurisdiction may be obtained under both subsections for a tort committed outside the state requires only that jurisdiction under subsection (2) be imposed consistent with the constitutional requirements of due process. Thus, “minimum contacts” may be present under subsection (2) and jurisdiction thereunder may be appropriate even when it could not be achieved under the more stringent statutory requirements of subsection (3). The Georgia Supreme Court implied as much in Clarkson Power Flow, Inc. v. Thompson: “we note that limitations similar to those present in subsection ... [3] are constitutionally mandated under subsection [2]....” 244 Ga. 300, 301, 260 S.E.2d 9 (1979) (emphasis added). The possibility of looser jurisdictional requirements is not merely hypothetical, since this very result obtained under subsection (b) of the long-arm statute in Value Engineering Co. v. Gisell, 140 Ga.App. 44, 46, 48, 230 S.E.2d 29 (1976) (now subsection (2)). That case involved a shipment of radioactive material on a plane carrying the plaintiff as a passenger. The shipment originated in Washington and was en route to Louisiana. The defendant had no business dealings or other contacts with Georgia. Moreover, it had no control over the routing executed by the air carrier. The court held that because the defendant purposefully introduced an allegedly defective and dangerous item into the stream of commerce within the forum, it was subject to jurisdiction under subsection (b). The court disposed of the defendant’s argument that subsection (c) rather than subsection (b) should control in the following language:

[T]he General Assembly adopted subsection (c) ... not to restrict the applicability of subsection (b) but rather to liberalize the interpretation that this court had made of ‘tortious act or omission within this State.’ Since the adoption of subsection (c) the Supreme Court has reversed this court’s previously limited interpretation of subsection (b) and extended the exercise of jurisdiction over nonresident parties ‘to the maximum extent permitted by procedural due process.’

Id. at 46, 230 S.E.2d at 32 (quoting Coe & Payne v. Wood Mosaic Corp., 230 Ga. 58, 60, 195 S.E.2d 399 (1973)). Since the Georgia long-arm statute is thus co-extensive with the constitutional requirements of due process, this Court may exercise in person-am jurisdiction over a nonresident tortfeasor for committing a foreign tort whenever those requirements are satisfied, even when it may not be possible to sustain jurisdiction under the language of subsection (c). See also Shellenberger, 138 Ga. App. at 406 n. 13, 227 S.E.2d at 267 n. 13 (referring to the proposition that subsection (3) has been “swallowed up” by subsection (2)). But see Note, The Georgia Long-Arm Statute, 11 Ga.L.Rev. 149, 176-81 (1976) (arguing that subsection (2) should not be construed to reduce the requirements of subsection (3) to unnecessary surplusage). See generally Ellington, Trial Practice and Procedure, 29 Mercer L.Rev. 265, 265-69 (1977).

The claims alleged are, in addition, adequately related to this defendant’s activities in Georgia. When there is a battle of affidavits placing different constructions on the facts, the Court is inclined to give greater weight, in the context of a motion to dismiss, to the plaintiff’s version. See Marine Midland Bank, N.A. v. Miller, 664 F.2d 899, 904 (2d Cir.1981) (when the court elects not to conduct an evidentiary hearing, plaintiff need only make a prima facie showing of jurisdiction through its own affidavits and supporting materials, “notwithstanding any controverting presentation by the moving party____”). See Jean v. Nelson, 711 F.2d 1455, 1487 (11th Cir. 1983) (“The prima facie case ... is based solely on evidence presented by the plaintiff____”). This seems especially desirable when, as herein, the jurisdictional questions are apparently intertwined with the merits of the case. See generally 2A J. Moore & J. Lucas, Moore’s Federal Practice II 12.07[2.-2], at 12-56 to -58 (2d ed. 1985).

The Court thus accepts the plaintiffs version of the purpose and consequences of Mr. Gerleman’s visit, its version of Ms. Borger’s solicitation activities in Atlanta, and its version of the nature of the payments involved. On this basis, the “minimum contacts” standard of due process is met, since it is apparent that the defendant PSI purposefully availed itself of the resources of the forum. Furthermore, PSI’s continuing course of conduct and connection with Georgia, as alleged, are such that it should reasonably expect being haled into court here. World-Wide Volkswagen Corp. v. Woodson, 444 U.S. at 297, 100 S.Ct. at 562. The claims alleged must arise out of or be “connected with” the defendant’s activities in this state. International Shoe Co. v. Washington, 326 U.S. 310, 319, 66 S.Ct. 154, 159, 90 L.Ed. 95 (1945). It is undisputed that they are. Nor can it be said that the exercise of jurisdiction offends traditional notions of “fair play” and “substantial justice.” It has not been made clear that the burden on the defendant of defending this suit would be excessive, it would seem that Georgia has a significant interest in adjudicating cases involving the infringement of license agreements under the federal copyright laws entered into on its territory, and the plaintiff has a substantial interest in “ ‘obtaining convenient and effective relief.’ ” Burger King Corp. v. Rudzewicz, — U.S. -, -, 105 S.Ct. 2174, 2184, 85 L.Ed.2d 528 (1985) (quoting World-Wide Volkswagen Corp., 444 U.S. at 292, 100 S.Ct. at 564). The defendant is not precluded, as a result of these findings, from litigating the issue of jurisdiction at trial.

Jurisdiction over Mr. Gerleman in his personal capacity is another matter. Nothing in the record indicates that Mr. Gerleman may be sued in this forum for actions taken here on his own behalf, nor would any such actions appear to be related to the subject matter of the lawsuit. The plaintiff has not attempted to demonstrate that the exercise of jurisdiction over Mr. Gerleman himself would be appropriate and has, consequently, failed to make a prima facie showing of jurisdiction. While the motion to dismiss must be denied as to PSI, it must be granted as to Mr. Gerleman in his individual capacity.

Finally, the defendants move to dismiss this action because of improper venue. The basis of this contention is that because personal jurisdiction cannot be maintained, venue may not lie in this district. In light of the foregoing discussion, this argument is without merit.

Accordingly, the defendants’ motion to dismiss is GRANTED in part and DENIED in part.

      . -Subsection (2) reads: "A court of this state may exercise personal jurisdiction over any nonresident ... if in person or through an agent, he: ... (2) commits a tortious act or omission within this state, except as to a cause of action for defamation of character arising from the act; ____" O.C.G.A. § 9-10-91 (Supp. 1985).


author: KEETON, District Judge.

text:
    James CROSBY, Plaintiff, v. NEW ENGLAND TELEPHONE AND TELEGRAPH COMPANY, Defendant.
    Civ. A. No. 83-0354-K.
    United States District Court, D. Massachusetts.
    Dec. 31, 1985.
    Carroll E. Ayers, Ayers & Conley, Wake-field, Mass., for plaintiff.
    F. Barry Maher, William J. McDonald, New England Tel. & Tel. Co., Boston, Mass., for defendant.
   MEMORANDUM

KEETON, District Judge.

Plaintiff, a career employee of defendant, applied for and was granted, effective February 12, 1982, a Company Service Pension at age 62. In 1983, he filed this action under the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621, et seq., alleging that but for defendant’s engaging in practices prohibited by 29 U.S.C. § 623(a)(1) and (a)(2) he would have remained an active employee until his 65th birthday, October 14,1984. With the objective of aiding the parties in determining whether the case can be settled, the court invited memoranda of law on the applicable measure of recovery in the event plaintiff prevails. After further conferences in July and August, the submissions are now before the court for determination of one of the principal issues in dispute.

I.

Plaintiff seeks an award of back pay pursuant to the following provisions of the Act:

Amounts owing to a person as a result of a violation of this chapter shall be deemed to be unpaid minimum wages or unpaid overtime compensation for purposes of sections 216 and 217 of this title: Provided, That liquidated damages shall be payable only in cases of willful violations of this chapter. In any action brought to enforce this chapter the court shall have jurisdiction to grant such legal or equitable relief as may be appropriate to effectuate the purposes of this chapter, including without limitation judgments compelling employment, reinstatement or promotion, or enforcing the liability for amounts deemed to be unpaid minimum wages or unpaid overtime compensation under this section.

29 U.S.C. § 626(b). The references to “unpaid minimum wages” and “unpaid overtime compensation” have been construed to allow aggrieved employees to recover “lost wages.” Lorillard v. Pons, 434 U.S. 575, 579, 98 S.Ct. 866, 869, 55 L.Ed.2d 40 (1978).

As I understand the contentions of the parties, further clarified in written submissions and conferences, the contrasting ways that plaintiff and defendant propose to calculate the award, should plaintiff succeed on his basic claim under ADEA, are shown in the following table:

Foregone Compensation to Age 65 Plaintiffs Defendant’! Calculation Calculador

1. Foregone Wages (age 62 to age 65) $78,900.00 $78,900.00

2. Less Pension Payments Plaintiff Received (age 62 to age 65) 26,792.50 26.792.50

3. $52,107.50 $52,107.50

4. Less Social Security Benefit Payments Plaintiff Received (age 62 to age 65) 0 34.284.50

5. $52,107.50 $17,823.00

6. Less Any Deduction Incident to Plaintiff’s Obligation to Mitigate His Damages 0 to be determined

7. Proposed Award for Foregone Compensation to Age 65 $52,107.50 to be determined

Foregone Future Compensation:

8. Plaintiff’s Current Monthly Pension $ 886.19 $ 886.19

9. Plaintiffs Monthly Pension Had He Not Retired Until Age 65 995.67 995.67

10. Monthly Difference $ 109.48 $ 109.48

11. Present Value of Monthly Difference for Life Expectancy $ 8,000.00 $ 8,000.00

Plaintiff’s Foregone Future Compensation: Calculation Defendant’s Calculation

12. Present Value of Difference in Wife’s Monthly Survivor Annuity $ 900.00 $ 900.00

Total $ 8,900.00 $ 8,900.00

13. Proposed Award for Foregone Future Compensation 8,900.00 8,900.00

TOTAL AWARD $61,007.50 to be determined (not more than $26,723.00)

II.

The central issue addressed by the memoranda of the parties concerns line 4 of the calculations recited above, relating to the social security benefits received by the plaintiff up to age 65.

Defendant calls attention to the fact that they were exceptionally high in this instance because, during part or all (the submissions are not clear as to which) of this period plaintiff had a minor child and therefore received some amount (not made clear) in addition to his normal retirement benefit, which he would never have received had he retired at age 65.

Both the normal benefit and the addition by reason of minority of a child are benefits that plaintiff would not have received but for his early retirement. If these benefits are not deducted in calculating the ADEA award, he receives more than compensation for his loss from “unpaid wages” and — absent assumptions of economic loss in some other way not disclosed by evidence — more than enough to restore him to the economic position he would have occupied if defendant’s alleged violations of ADEA had not occurred. Should part or all of the $34,284.50 in social security benefits received between ages 62 and 65 be deducted in calculating an ADEA award to plaintiff if it is determined that plaintiff is entitled to such an award?

The First Circuit has not answered this question, nor has it ruled upon any closely analogous question. Decisions of other circuits that are arguably in point or closely analogous include several conflicting strands of authority.

The Third Circuit has held that as a rule of law and not as a matter of discretion, neither social security benefits nor unemployment benefits should be deducted. E.g., Maxfield v. Sinclair International, 766 F.2d 788, 793-95 (3d Cir.1985) (social security benefits are collateral and should not be deducted from an ADEA back pay award); McDowell v. Avtex Fibers, Inc., 740 F.2d 214, 215-17 (3d Cir.1984), vacated and remanded on other grounds, — U.S. -, 105 S.Ct. 1159, 84 L.Ed.2d 312 (1985) (unemployment benefits may not be deducted from an ADEA back pay award).

One may also read decisions of the Fourth and Sixth Circuits as supporting a firm rule of law against deduction of benefits such as social security and unemployment compensation. See Rasimas v. Michigan Dept. of Mental Health, 714 F.2d 614, 627 (6th Cir.1983) (“unemployment compensation also should not be deducted from [Title VII] backpay awards”), and EEOC v. Ford Motor Co., 645 F.2d 183, 195-96 (4th Cir.1981) (back pay awards under Title VII should not be affected by unemployment compensation, citing Abron v. Black & Decker Manufacturing Co., 439 F.Supp. 1095, 1115 (D.Md.1977), aff'd in part and vacated in part, 654 F.2d 951 (4th Cir. 1981)). In one case presented for decision shortly after the Third Circuit adopted a like rule for Title VII cases, I applied that rule in a Title VII sex discrimination context, relying on the weight of authority at that time. Ryan v. Raytheon, 601 F.Supp. 243, 254 (D.Mass.1985), citing Craig v. Y & Y Snacks, Inc., 721 F.2d 77, 81-85 (3d Cir.1983) and the cases there cited.

The reasoning of the Third Circuit is that the employee, who may have suffered noncompensable losses, should get the benefit of “collateral” funds, not the employer who wrongfully discharged the employee.

This reasoning is vulnerable to the criticism that neither social security nor unemployment benefits are entirely “collateral,” since the employer was required by law to make contributions to support the social security and unemployment benefit systems. Harper and James, in discussing the appropriate use of the collateral benefit rule to cases involving social security legislation, noted that

[T]he double recovery result in the accident insurance cases is hard indeed to justify on principle though perhaps it has done little harm in practice for, as practical claim men know, the beneficiary of an accident policy is usually willing to settle his tort claim for less than he otherwise would.
The implications of the foregoing discussion for the problem of social insurance seem fairly clear. To the extent that welfare legislation is concerned with compensation or indemnity, accident insurance furnishes a weak analogy, and there seems to be no basis for double recovery to the claimant whether the legislation is one providing for a contribution on his part or not. Presumably such schemes are not intended to provide windfalls. Certainly there is little if any trace of such intent in the philosophy of the American legislation, and it is submitted that the courts should be exceedingly reluctant to find it.

2 F. Harper & F. James, The Law of Torts, § 25.22 at 1354 (1956) (citations omitted). But cf. EEOC v. Sandia Corp., 639 F.2d 600, 625 (10th Cir.1980), and Restatement (Second) of Torts, § 920A, comment c(4) (1979). Thus, the Third Circuit rule, rather than being clearly analogous to the collateral source rule of tort law, is arguably an extension beyond that rule. And such an extension is the more striking in view of other recent developments in the law manifesting a public policy, at least in some contexts, in favor of coordination of benefits and avoidance of duplicative or “windfall” benefits through public and private insurance and compensation systems. See, e.g., Cody v. Connecticut General Life Insurance Co., 387 Mass. 142, 439 N.E.2d 234, 238-39 (1982) (“coordination-of-benefits clauses [in insurance contracts] serve the public purpose of avoiding duplicate recoveries for the same injuries.”) (citations omitted).

Both the Third Circuit and other courts have carved an exception to the Third Circuit rule for cases in which a governmental body rather than a private entity is the party seeking the offset. E.g., Dillon v. Coles, 746 F.2d 998, 1007 (3d Cir.1984). Cf. EEOC v. Wyoming Retirement System, 771 F.2d 1425, 1432 (10th Cir.1985), which, however, also treats the issue of offset as one for the exercise of discretion. The recognition of this exception somewhat undercuts the force of any argument for further extensions, by analogy, of a rule of law, and not merely an exercise of discretion, against offsetting benefits.

Another current of authority, outside the Third Circuit, treats issues of offset as matters for discretionary determination. E. g., EEOC v. Wyoming Retirement System, 771 F.2d at 1432; Syvock v. Milwaukee Boiler Mfg. Co., 665 F.2d 149, 161-62 (7th Cir.1981); Naton v. Bank of California, 649 F.2d 691, 700 (9th Cir.1981); Marshall v. Goodyear Tire & Rubber Co., 554 F. 2d 730, 736 (5th Cir.1977). See also EEOC v. Sandia Corp., 639 F.2d 600 (10th Cir.1980).

An invariably applicable rule of law such as the Third Circuit has adopted serves the interests of predictability and certainty, but at the same time necessarily sacrifices the ability of the courts to tailor relief more sensitively to the circumstances of each particular case. It elects predictable, rough justice over less predictable but more sensitively refined outcomes.

In addition to this array of conflicting strands of authority, I take account of the First Circuit’s declarations that back pay awards are aimed at restoring the plaintiff to the economic position the plaintiff would have occupied had no wrong occurred. Kolb v. Goldring, Inc., 694 F.2d 869, 872 (1st Cir.1982) (“Damages are meant to put the plaintiff in the economic position he would have occupied but for the discrimination. Loeb v. Textron, Inc., 600 F.2d 1003 (1st Cir.1979); ...”). I conclude that the First Circuit is more likely to adopt a view providing for an exercise of discretion than a rule such as the Third Circuit has adopted. This probability is strengthened by the availability of the ADEA provision for liquidated damages where willful discrimination is proved.

I will defer formal ruling on this issue until entering judgment in this case, at which time I can take into account any intervening developments in the law as well as any additional facts that may be offered in evidence. The parties are advised, however, that in the absence of evidence beyond that now before the court in the present submissions, I expect to rule, in the exercise of discretion, that the $34,-284.50 plaintiff received in social security benefits from age 62 to 65 should be deducted in determining any award of back pay for that period.


author: YOUNG, District Judge.

text:
    UNITED STATES of America, Plaintiff, v. ONE 1978 BMW VIN NUMBER 5391202, Defendant.
    Civ. A. No. 84-2968-Y.
    United States District Court, D. Massachusetts.
    Dec. 31, 1985.
    Asst. U.S. Atty. Jeffrey R. Martin, Boston, Mass., for plaintiff.
    Henry F. Owens, III, Ellen K. Wade, Owens & Associates, Boston, Mass., for defendant.
   MEMORANDUM AND ORDER

YOUNG, District Judge.

This is an action for judgment of forfeiture for property seized on land and subject to the provisions of 49 U.S.C. §§ 1345 and 1355. The United States has moved for judgment by default. The matter was scheduled for hearing on September 18, 1985, but when neither the BMW nor its counsel appeared, the government agreed to submit the question on briefs.

The complaint in this case was filed on September 19, 1984. On October 9, 1984, the Clerk of the Court issued a Warrant and Monition directing, inter alia, service of the complaint on one Mai Johnson, the owner of record of the defendant BMW. The proof of service provided this Court indicates that Johnson was served on October 18, 1984. On November 13,1984, Johnson filed an “Answer” contending the seizure was unlawful and demanding return of the property along with compensatory damages. The United States has moved to strike this Answer and enter judgment by default.

Proceedings in forfeiture cases involving property seized on land may be enforced by a libel action conforming as nearly as possible to a proceeding in admiralty. 28 U.S.C. § 2461(b). Rule C(6) of the Supplemental Rules For Certain Admiralty and Maritime Claims provides that “[t]he claimant of property that is the subject of an action in rem shall file his claim within 10 days after process was executed, ... and shall serve his answer within 20 days after the filing of the claim.” The Rule makes plain that the “filing of a claim is a prerequisite to the right to file an answer.” United States v. Fourteen Handguns, 524 F.Supp. 395, 397 (S.D.Tx.1981). In addition, the Rule requires that a claim “shall be verified on oath or solemn affirmation.”

In this case, Johnson’s first response to the complaint — the “Answer” — was filed more than two weeks beyond the claim period provided by Rule C(6). Moreover, it was not until April 16, 1985 that Johnson filed a properly verified claim. Johnson argues that this delay should be excused because the government waited to bring this action until a time when it knew “Johnson and his attorneys were much more urgently concerned with his impending sentencing and probable incarceration.” The Court rejects the invitation to create an “inconvenient timing” exception to Rule C(6). Cf. United States v. Fourteen Handguns, 524 F.Supp. at 397 (where no proper claim preceded answer, motion to strike answer granted). Simply as an empirical matter, it is difficult to see how a concern over a pending criminal conviction would prejudice a claimant’s ability to respond to the notice. So long as one is able to obtain paper, pencil and a stamp, the effort required to submit a notice of claim is minimal. The failure of Johnson to timely respond is inexcusable on the facts of this case.

Accordingly, the motions of the United States to Strike Johnson’s Answer and for Default Judgment are ALLOWED. Johnson’s motions are DENIED. The Clerk shall enter default judgment in favor of the United States.


author: SCHWARZER, District Judge.

text:
    FEDERAL ELECTION COMMISSION, Plaintiff, v. SAILORS’ UNION OF THE PACIFIC POLITICAL FUND, et al., Defendants.
    No. C-84-7763-WWS.
    United States District Court, N.D. California.
    Jan. 3, 1986.

      Robert W. Bonham, III, Office of the Gen. Counsel, Federal Election Com’n, Washington, D.C., for plaintiff.
    Fred H. Altshuler, Altshuler & Berzon, San Francisco, Cal., for Seafarers’ Political Activity Donation.
    John F. Henning, Henning, Walsh & Ritchie, San Francisco, Cal., for Sailors’ Union & Marine Firemen’s Union.
   MEMORANDUM OF OPINION AND ORDER

SCHWARZER, District Judge.

This is an action for declaratory, injunctive and other relief brought by the Federal Election Commission (“FEC”) against three political action committees (“PACs”), each of which is connected with a different labor organization. The issue is whether the FEC properly can treat these three PACs as related organizations whose campaign contributions must be aggregated for the purpose of determining compliance with the limitation on such contributions in the Federal Election Campaign Act of 1971, as amended, 2 U.S.C. § 431 et seq. (“FECA” or “Act”).

Defendant Seafarers’ Political Activity Donation (“SPAD”) is a multicandidate PAC established by the Seafarers International Union of North America, Atlantic, Gulf, Lakes and Inland Waters District (“SIUAG”). Defendant Marine Firemen’s Union Political Action Fund (“Firemen’s Fund”) is a multicandidate PAC established by the Marine Firemen’s Union (“MFU”). Defendant Sailors’ Union of the Pacific Political Fund (“Sailors’ Fund”) is a multicandidate PAC established by the Sailors’ Union of the Pacific (“SUP”). Each of the connected labor organizations of each defendant PAC — ¿e. SIUAG, SUP and MFU — is a member of the Seafarers International Union of North America (“Seafarers”).

Section 441a(a)(2)(A) prohibits a multicandidate PAC from contributing more than $5,000 to any particular candidate for federal office. Section 441a(a)(5) further specifies that contributions made by PACs connected with organizations having a certain relationship to each other must be aggregated for the purpose of determining whether this $5,000 limit has been exceeded. This provision states, in relevant part:

For purposes of the limitations provided by ... [2 U.S.C. § 441a(a)(2) ], all contributions made by political committees established or financed or maintained or controlled by any corporation, labor organization, or any other person, including any parent, subsidiary, branch, division, department, or local unit of such corporation, labor organization, or any other person, or by any other group of such persons, shall be considered to have been made by a single political committee ... In any case in which a corporation and any of its subsidiaries, branches, divisions, departments or local units, or a labor organization and any of its subsidiaries, branches, divisions, departments or local units establish or finance or maintain or control more than one separate segregated fund, all such separate segregated funds shall be treated as a single separate segregated fund for purposes of the limitations provided by [2 U.S.C. § 441a(a)(2)].

On May 6, 1981, SPAD contributed $5,000 to the Brown for U.S. Senate Committee (“Brown Committee”), the authorized principal campaign committee of Governor Edmund G. (Jerry) Brown, Jr., during the 1982 Democratic primary election for U.S. Senator from California. On June 24, 1981, on its own behalf and without consulting with Seafarers, SPAD or SIUAG, the Sailors’ Fund contributed $500 to the Brown Committee. On October 31, 1981, on its own behalf and without consulting with Seafarers, SPAD or SIUAG, the Firemen’s Fund contributed $500 to the Brown Committee. On March 9, 1982, under similar circumstances, the Firemen’s Fund contributed $750 to the Brown Committee. On March 11, under similar circumstances, the Sailors’ Fund contributed $750 to the Brown Committee.

Acting on a complaint filed by Representative Robert K. Doman (R-Calif.), the FEC found reason to believe that defendants had violated § 441a(a)(2)(A), and initiated an investigation. Following administrative proceedings, the FEC brought this action for a declaratory judgment that defendants had violated the Act, for civil penalties, and for an injunction against future violations. As the material facts are not in dispute, all parties have moved for summary judgment.

The FEC contends that the defendant PACs are all controlled by a single labor organization within the meaning of § 441a(a)(5), i.e., Seafarers. In the alternative, the FEC argues that each of the three unions that control the defendants is a division, department or local unit of a single labor organization within the meaning of § 441a(a)(5). On either ground, it contends, the contributions made by defendants must be treated as having been made by a single political committee.

Defendants contend that they are not commonly controlled organizations whose contributions may be aggregated, and that the unions’ independent histories, structures and management demonstrate that none of them is a division, department or local unit of the same labor organization.

The Anti-Proliferation Amendments

Congress passed the Act in 1971 to limit the actuality and appearance of corruption resulting from large individual financial contributions. See Buckley v. Valeo, 424 U.S. 1, 26, 96 S.Ct. 612, 638, 46 L.Ed.2d 659 (1976). The Act imposed limits on the amount of money any person or group may contribute to any one political candidate, party, or committee. See § 441a(a)(l), (2) & (3). Because the Act did not limit the number of political committees any person or group could establish, however, the contribution limits could be evaded by having each of a number of political committees contribute the statutory maximum. To close this loophole, Congress in 1976 adopted Section 441a(a)(5), known as the “antiproliferation amendment,” which requires contributions by political committees under common control to be aggregated. See House Conference Report No. 94-1057, reprinted in 1976 U.S.Code Cong. & Admin. News, 94th Cong., 2d Sess., 929, at 973.

Under the antiproliferation amendment, contributions made by separate political committees such as defendants are treated as having been made by a single political committee if they meet either of the following two tests: First, if they are “established or financed or maintained or controlled” by the same person or group of persons; or second, if they are “divisions, departments or local units” of a single labor organization.

1. The Control Test

The FEC argues, first, that the defendant committees are controlled by Seafarers. It relies on its regulations, which provide that indicia of control include

(B) Provisions of bylaws, constitutions or other documents by which one entity has the authority, power or ability to direct another entity; 11 CFR § 100.-5(g)(ii).

In support of its argument, the FEC points to the provisions of the Seafarers’ constitution that (i) require its members to abide by it, (ii) empower it to appoint a custodian to take possession of a member’s assets when its dues are in arrears, and (iii) permit it to conduct non-binding grievance procedures involving its members.

The Commission’s argument, however, misses the mark. Seafarers is an association of independent unions, none of which was created by Seafarers. Member unions may affiliate and disaffiliate with Seafarers at will. Other than having power to collect dues, Seafarers has no power over the affairs of its member unions. It has no power to adjudicate disputes among them. It has no control over the position taken by them on legislative or political issues or candidates and, in fact, its positions have at times been opposed by its members.

In sum, the relevant indicia establish the autonomy of Seafarers’ member unions. The constitution embodies the rules that govern the relationship of these unions and those rules preserve their independence, a fact confirmed by the undisputed evidence of their past conduct.

2. The Division, Department or Local Unit Test

Alternatively, the FEC argues that regardless of whether actual control is established, the defendants’ contributions must be aggregated because they were made by labor organizations that are divisions, departments or local units of Seafarers. It contends that labor organizations that are a part of an international union must be treated as affiliated for purposes of § 441a(a)(5) regardless of the internal organization scheme adopted.

As discussed in the preceding section, the Seafarers’ constitution preserves the essential elements of autonomy of its members. Nothing in it suggests a relationship making its members divisions, departments or local units. The relationship it creates differs fundamentally from that between an international union and its locals, which are its subordinate creatures and operate under its control. The distinction is illustrated by the statement of Representative Wayne Hays, Chairman of the House Administration Committee, who, in introducing the proposal that would become 2 U.S.C. § 441a(a)(5), emphasized that the aggregation requirement of that provision would not apply to members of a voluntary association such as the AFL-CIO:

.... [A]n international union can set up a PAC and all of its local unions, state unions, etc., would be treated as a single political committee____ Then the AFL-CIO which is a voluntary conglomerate and all its state and central bodies should be treated as a single political committee and they could give up to $5,000 in any fragments they wanted to____
[Transcript of Hearings Before the Committee on House Administration, March 8, 1976 at 43] (emphasis added).

Consistent with that statement, the FEC has never aggregated contributions made by committees of the AFL-CIO with those of committees of its member unions. The relation between Seafarers and its members is more nearly analogous to that between the AFL-CIO and its members than to that between international and local unions.

The decision in Walther v. FEC, 468 F.Supp. 1235 (D.D.C.1979), has no bearing on the issue before this Court. In that case, Judge Richey simply denied the FEC’s motion to dismiss a complaint under the Act, rejecting the FEC’s argument that contributions by the AFL-CIO’s committee could never be aggregated with those of one of its member unions. The opinion seems to imply that even if per se aggregation based on the division, department or local unit language were inappropriate, aggregation would be proper if actual control were proved.

For the reasons stated, the Court finds and concludes on undisputed facts that the FEC has failed to show that defendants, as committees established by voluntary members of Seafarers, are divisions, departments or local units of or are otherwise controlled by Seafarers. In reaching that conclusion the Court is mindful of the Supreme Court’s assessment of the Act as a restriction upon rights protected by the First Amendment:

A restriction on the amount of money a person or group can spend on political communication during a campaign necessarily reduces the* quantity of expression by restricting the number of issues discussed, the depth of their exploration, and the size of the audience reached. This is because virtually every means of communicating ideas in today’s mass society requires the expenditure of money. The distribution of the humblest handbill or leaflet entails printing, paper, and circulation costs. Speeches and rallies generally necessitate hiring a hall and publicizing the event. The electorate’s increasing dependence on television, radio, and other mass media for news and information has made these expensive modes of communication indispensable instruments of effective political speech.

Buckley v. Valeo, 424 U.S. 1, 19, 96 S.Ct. 612, 635, 46 L.Ed.2d 659 (1976). An interpretation of the Act under which contributions independently made by voluntarily associated labor organizations are aggregated, thereby severely restricting the exercise of first amendment rights, would raise serious constitutional questions. Such an interpretation should be avoided if possible. Machinists v. Street, 367 U.S. 740, 749-50, 81 S.Ct. 1784, 1790, 6 L.Ed.2d 1141 (1961); Murray v. The Charming Betsy, 6 U.S. (2 Cranch) 64, 2 L.Ed. 208 (1804).

Accordingly, defendants’ motion for summary judgment is granted and plaintiff’s motion is denied.

IT IS SO ORDERED.

      . FECA prohibits labor unions and corporations from directly making contributions or expenditures in connection with certain federal elections, 2 U.S.C. § 441b(a), but it permits unions and corporations indirectly to make such contributions or expenditures through "separate segregated funds”, 2 U.S.C. § 431(4), or PACs. A “multicandidate political committee” is a political committee that has received contributions from more than 50 persons and that has made contributions to 5 or more candidates for federal office. 2 U.S.C. § 441a(a)(4). The labor union or corporation that establishes a political committee is described by FECA as its "connected organization.” 2 U.S.C. § 431(7).


author: DORSEY, District Judge.

text:
    SERVICE ROAD GULF, INC. v. GULF OIL CORP., Irwin B. Singer, Trustee.
    Civ. No. H-84-1247 (PCD).
    United States District Court, D. Connecticut.
    Jan. 3, 1986.
    Lawrence S. Hillman, Law Offices of Donald E. Weisman, Hartford, Conn., for plaintiff.

      David A. Reif, Reif & Manke, New Haven, Conn., for defendant Gulf Oil.
    Philip L. Steele, Rogin, Nassau, Caplan, Lassman & Hirtle, Hartford, Conn., for defendant Singer, trustee.
   RULING ON PENDING MOTIONS

DORSEY, District Judge.

Facts

Plaintiff was a franchisee of defendant Gulf Oil Corporation (“Gulf”) within the meaning of the Petroleum Marketing Practices Act (“PMPA”), 15 U.S.C. §§ 2801-2806.

On November 22, 1983, representatives of Gulf met with plaintiff and a representative of Atlas Oil Co. (“Atlas”) to discuss an assignment of the franchise from Gulf to Atlas.

On November 28, 1983, Gulf executed a Quit Claim Deed transferring its rights, title and interest in and to the premises located at 51 West Service Road, Hartford — the site of plaintiffs service station — to defendant Irwin B. Singer, as trustee for his children. The deed contained the following covenant:

In accepting this conveyance, and as part of the consideration therefor, Releasee [Irwin B. Singer, Trustee] acknowledges that Service Road Gulf, Inc. has a franchise, as defined in the [PMPA], with respect to the property covered by this conveyance. Releasee agrees that Releasee will, in all matters, act as though Releasee were a franchisor under the [PMPA], and Releasee shall not terminate or fail to renew the franchise or franchise relationship with Service Road Gulf, Inc. except as provided in the [PMPA].

Plaintiffs Complaint at 6.

On December 9, 1983, Gulf assigned the leases and accounts of certain customers, including plaintiff, to Elmwood Distributors, Inc. (“Elmwood”). Mr. Singer is president of Atlas and Elmwood. The assignment included the following:

Assignee [Elmwood] acknowledges that the Contracts and Agreements are franchises, as defined in the [PMPA], with respect to the sale of motor fuels. Assignee agrees that he shall not terminate or fail to renew the Contracts or Agreements covering the sale of motor fuels, except as provided in the [PMPA]. Assignee agrees to indemnify and hold Assignor harmless from any and all claims ... asserted by the purchasers named in or represented by the attached Contracts and Agreements arising out of, or in any way connected with, the failure of Assignee to strictly comply with the provisions of the [PMPA]____

Third Party Complaint of Gulf at 2.

On December 21, 1983, Elmwood assigned its agreement with Gulf to Atlas. Plaintiffs rent for December 1983 was split between Gulf and Atlas.

On March 16, 1984, Atlas notified plaintiff that it was terminating plaintiffs franchise effective June 18, 1984.

Pending are defendant Singer’s motions to dismiss, for attorney’s fees, and for summary judgment.

Discussion

The pending motions raise a single issue: is Irwin B. Singer, Trustee, the plaintiff’s “franchisor” within the meaning of the PMPA?

The PMPA defines “franchisor” as “a refiner or distributor ... who authorizes or permits, under a franchise, a retailer or distributor to use a trademark in connection with the sale, consignment, or distribution of motor fuel.” 15 U.S.C. § 2801(3). The word “franchise” means “any contract” between a refiner (or distributor) and a retailer (or distributor) “under which a refiner or distributor (as the case may be) authorizes or permits a retailer or distributor to use, in connection with the sale, assignment, or distribution of motor fuel, a trademark which is owned or controlled by such refiner____” Id. at § 2801(1)(A). The term “franchise” specifically includes “any contract under which a retailer or distributor ... is authorized or permitted to occupy leased marketing premises, which premises are to be employed in connection with the sale, consignment, or distribution of motor fuel under a trademark which is owned or controlled by such refiner,” id. at § 2801(l)(B)(i), and “any contract pertaining to the supply of motor fuel which is to be sold, consigned, or distributed [under a trademark owned or controlled by a refiner].” ' Id. at § 2801(l)(B)(ii).

Mr. Singer asserts that his relationship with plaintiff is clearly not that of franchisor/franchisee. There was no contract between Mr. Singer (in his capacity as trustee) and plaintiff for the sale or distribution of motor fuel sold under a trademark. See Abadjian v. Gulf Oil Corp., 602 F.Supp. 874 (C.D.Cal.1984). There was no franchise fee imposed upon plaintiff by Mr. Singer, or a marketing plan for plaintiff, both of which are “essentially components of a franchise agreement.” Id. at 879. Mr. Singer is neither a refiner nor distributor and has not acted as a refiner or distributor with respect to plaintiff. See generally Farm Stores, Inc. v. Texaco, Inc., 763 F.2d 1335 (11th Cir.1985) (“Unless the parties meet the statutory definition of one of these terms [i.e., “refiner,” “distributor,” or “retailer”], there is no coverage under the PMPA”). Mr. Singer claims that the Quit Claim Deed executed in his favor by Gulf merely made him the owner of the premises where the plaintiff conducts its retail gasoline operations and that the franchise plaintiff had with Gulf — defined to include the original lease between plaintiff and Gulf as well as the agreements relative to the marketing of gasoline— passed from Gulf to Atlas (via Elmwood) by virtue of the respective assignments described in the statement of facts, supra.

Plaintiffs position is that, irrespective of the statutory definition, Mr. Singer became a “franchisor” on November 28, 1983, when he signed the Quit Claim Deed. The deed required Mr. Singer to “act as though” he were a franchisor, and in it Mr. Singer also agreed “not [to] terminate or fail to renew the franchise or franchise relationship with Service Road Gulf, Inc., except as provided in the [PMPA].” Plaintiffs Complaint at 6. Plaintiff asserts that neither Gulfs attempted assignment of the franchise agreements to Elmwood on December 9, 1983, nor Elmwood’s attempted assignment of same to Atlas on December 21, 1983, were legal or binding in light of Gulf’s prior agreement with Mr. Singer that he would act as plaintiff’s “franchisor.” Plaintiff, therefore, claims that the notice of non-renewal of its franchise was ineffective under the PMPA because the notice was given by Atlas, not Mr. Singer, Trustee.

The language in the Quit Claim Deed was not effective in creating a franchise relationship between plaintiff and Mr. Singer, Trustee. The limited purpose of the restrictive covenant insured that the new owner of the premises, Mr. Singer, would not be able to evict plaintiff for any reason not provided for in the PMPA. It is well established, for example, that termination of a master lease between a PMPA franchisor and the actual owner of the land upon which the service station is built, constitutes valid ground for non-renewal of the franchise agreement between the franchisor (sub-lessor) and the franchisee (sub-lessee). Hifai v. Shell Oil Co., 704 F.2d 1425 (9th Cir.1983); Veracka v. Shell Oil Co., 655 F.2d 445 (1st Cir.1981). Gulf, in the instant case, was trying to protect plaintiff to the extent of requiring Mr. Singer to take title to the premises subject to plaintiff’s franchise rights, so that Singer could not take action as the property owner which would interfere with plaintiff’s rights as defined in the PMPA. In the same way that a contract cannot exempt a franchisor from PMPA obligations, neither can a contract create them.

Even if Mr. Singer effectively assumed the status of a franchisor, the notice issued met the requirements of the PMPA. The notification of non-renewal, though sent on behalf of Atlas, was signed by Mr. Singer, as president of Atlas. Although the notice provisions of the PMPA are to be strictly construed, Escobar v. Mobil Oil Corp., 678 F.2d 398 (2d Cir.1982), to hold, as plaintiff argues, that Mr. Singer should have sent another notice to plaintiff, identical to the first, but without reference to Atlas, would elevate form over substance.

Accordingly, the motion to dismiss and the motion for summary judgment in favor of Irwin B. Singer, Trustee, are granted. The motion for attorney’s fees is denied.

SO ORDERED.


author: EDELSTEIN, District Judge:

text:
    UNITED STATES of America, v. Alvin SIGALOW, Defendant.
    No. 85 Cr. 315 (DNE).
    United States District Court, S.D. New York.
    Jan. 3, 1986.
    Rudolph W. Giuliani, U.S. Atty. for the S.D.N.Y., Viktor V. Pohorelsky, Asst. U.S. Atty., of counsel, for plaintiff.
    Stanley A. Teitler, P.C., New York City, Stanley A. Teitler and Jeffrey S. Gubernick, of counsel, for defendant.
   OPINION AND ORDER

EDELSTEIN, District Judge:

Defendant Alvin Sigalow (“Sigalow”) is charged with one count of conspiring to defraud the government in violation of Title 18, Section 371 of the United States Code and one count of using interstate facilities, including the mail, to promote, manage, establish and carry on the two prostitution enterprises in violation of Title 18, Section 1952 of the United States Code. Sigalow has moved to sever the two counts of the indictment pursuant to Rules 8, 12(b)(5), and 14 of the Federal Rules of Criminal Procedure. Defendant’s motion is hereby denied.

BACKGROUND

Sigalow is charged in Count One of the Indictment with conspiring to defraud the United States by impeding and obstructing the Internal Revenue Service from determining and collecting the tax obligations of two alleged prostitution enterprises. Count Two of the Indictment charges Sigalow with a violation of the “Travel Act.” Specifically, the defendant is charged with the use of interstate facilities, including the mail, to promote, manage, establish and carry on the two alleged prostitution enterprises.

Defendant moves to sever Counts One and Two claiming

1) that the charges in Counts One and Two are “completely unrelated”; and
2) that he will be prejudiced if both counts are tried together.

DISCUSSION

A. Relationship of Counts One and Two

Rule 8(a) of the Federal Rules of Criminal Procedure provides:

Two or more offenses may be charged in the same indictment ... in a separate count for each offense if the offenses charged ... are of the same or similar character or are based on the same act or transaction or on two or more acts or transactions connected together or constituting parts of a common scheme or plan.

Fed.R.Crim.P. 8(a). Defendant claims that the two counts are not connected and must be severed pursuant to the rule. Sigalow asserts that the crimes charged are of a different character, are based on distinct acts and in no way constitute a common plan. Defendant relies on United States v. Halper, 590 F.2d 422 (2d Cir.1978), and Deluca v. United States, 299 Fed. 741 (2d Cir.1924), to support this claim. Both of these cases are inapposite. In United States v. Halper, the court found that the joinder of two separate indictments, one charging several counts of Medicaid fraud and the other charging tax evasion, was improper. 590 F.2d at 428-31. In Halper, the sole basis for joinder was that the offenses were of the same or similar character. Id. at 430. This contention was rejected by the court. Id. The government in this case does not rely on this basis for joinder. Rather the government asserts that the two counts are “based on the same series of connected acts and transactions undertaken by ... Sigalow [and his alleged coconspirators], all of which related to the operation of the [two alleged prostitution enterprises].” Memorandum of Law in Opposition to Defendant’s Motion to Sever at 4-5. [hereinafter cited as Memo in Opposition].

Similarly, Deluca v. United States, offers little guidance. The court found that the evidence relating to a charge of conspiring to defraud the United States of import duties owed on shipments of opium was not the same as the evidence relating to a second charge for the illegal sale of opium. 299 Fed. at 745. This is not the situation presented by the two charges in the Indictment here.

The evidence against Mr. Sigalow involving the alleged prostitution enterprises relates to both counts in the Indictment. The conspiracy charged in the Indictment relates to the failure to report income derived by the defendant and others from the alleged prostitution enterprises. The source of the alleged unreported income would certainly be relevant to the government’s case on the conspiracy count. This same evidence would be relevant to the government’s case on the “Travel Act” count which charges the use of facilities in interstate commerce to “promote, manage, establish, carry on and facilitate the promotion, management, establishment and carrying on of” the same prostitution enterprises. See Indictment Count 2 at 112. These two counts can be deemed to based on the same series of acts and transactions and can be characterized as arising out of a common scheme. Accordingly, the two counts were properly joined pursuant to Rule 8(a). See United States v. Golomb, 754 F.2d 86, 88 (2d Cir.1985) (mail fraud charges properly joined with offenses relating to fencing operation even though different conduct was involved in two sets of offenses); cf. United States v. Gordon, 655 F.2d 478, 484-85 (2d Cir.1981) (consolidation of one indictment charging mail fraud and interstate transportation of stolen property with indictment charging the making of false statements in a loan application and interstate transportation of stolen property found to be proper under Fed. R. Crim.P. 13). See also United States v. Wirsing, 719 F.2d 859, 863 (6th Cir.1983); United States v. Shelton, 669 F.2d 446, 460 (7th Cir.), cert. denied, 456 U.S. 934, 102 S. Ct. 1989, 72 L.Ed.2d 454 (1982).

B. Prejudice from joinder of offenses

Defendant asserts that even should the court find that the joinder of the two counts is technically proper, trying the two counts together would prejudice the defendant’s right to a fair trial. The defendant must show that he would be so prejudiced by trying both counts that “in effect [he] would be denied a constitutionally fair trial.” United States v. Wheaton, 463 F.Supp. 1073, 1077 (S.D.N.Y.), aff'd mem., 614 F.2d 1293 (2d Cir.1979); accord United States v. Cody, 722 F.2d 1052, 1061 (2d Cir.1983), cert. denied, 467 U.S. 1226, 104 S.Ct. 2678, 81 L.Ed.2d 873 (1984); United States v. Aloi, 449 F.Supp. 698, 739 (E.D.N. Y.1977).

The defendant indicates that the inflamatory nature of the government’s proof on the prostitution charge may unfairly prejudice the defendant with respect to the tax conspiracy charge. See Fed.R.Crim.P. 14. Sigalow further contends that by trying the two counts together, the jury will possibly “transfer” intent from one charge to the other. Finally, the defendant contends that his right to testify on his own behalf will be prejudiced because he “might elect to testify to show an absence” of an agreement or intent on the conspiracy charge. Such testimony, it is suggested, would “jeopardize[ ] his defense on the unrelated charge.” Memorandum of Law in Support of Motion for Severance at 7-8.

Defendant’s arguments are unpersuasive. First, Sigalow contends that permitting evidence of the prostitution enterprise to be admitted during a trial on the tax charges would unfairly prejudice him. He contends that this would, in effect, permit the government to circumvent the limitations on “bad act” evidence contained in Rule 404. Defendant’s argument is based on an incorrect foundation. Evidence regarding the alleged prostitution enterprises would certainly be admissible at a separate trial on the tax conspiracy charge. These alleged enterprises constitute the source of the unreported funds alleged in the conspiracy count. Any prejudice comes from the nature of the source of the funds and cannot be deemed “unfair” prejudice. Thus, severance is not appropriate on this ground. United States v. Shelton, 669 F.2d at 461 (tax charges properly joined with mail fraud counts because tax charge related to failure to pay tax on proceeds of fraud); United States v. Treadwell, 566 F.Supp. 80, 86-87 (D.D.C.1983) (tax evasion and fraud related charges properly joined where fraud was source of unreported income); see United States v. Wilson, 715 F.2d 1164, 1171 (7th Cir.), cert. denied, 464 U.S. 986, 1049, 104 S.Ct. 434, 727, 78 L.Ed.2d 366, 79 L.Ed.2d 187 (1983). See also United States v. Brozyna, 571 F.2d 742, 747 (2d Cir.1977) (showing of substantial prejudice unlikely where proof at seperate trials would overlap). Compare United States v. Halper, 590 F.2d at 429 (funds obtained from alleged Medicaid fraud charge were not the same funds alleged to be unreported for the income tax charge).

Second, defendant argues that the jury may “transfer” intent from one count to the other. The government notes that “[t]his assertion could be made in virtually any trial where offenses are joined.” Memo in Opposition at 6. The court agrees with the government. Such a conclusory statement cannot provide a sufficient basis for severance. See United States v. Forrest, 623 F.2d 1107, 1115 (5th Cir.1980); United States v. Werner, 620 F.2d 922, 929 (2d Cir.1980); cf. United States v. McDonald, 576 F.2d 1350, 1355 (9th Cir.1978) (“Some prejudice necessarily inheres when defendants are joined for trial. However, ‘[i]f all that was necessary to avoid a joint trial were a showing of prejudice, there would be few, if any, multiple defendant trials.”) (quoting 8 J. Moore, W. Taggart & J. Wicker, Moore’s Federal Practice 1114.-04[1], at 14-14.1 (1977)). Further, problems of transferred intent may be cured by appropriate instructions. Cf. United States v. Olin Corp., 465 F.Supp. 1120, 1129 (W.D.N.Y.1979) (jury instructions enough to overcome any unnecessary prejudice regarding multiple defendant trial).

Finally, Sigalow’s assertion that he might testify at a separate trial on the conspiracy charge is inadequate to support a motion under Rule 14. The defendant must make a “convincing showing that he has important testimony concerning one count and a strong need to refrain from testifying on the other.” Baker v. United States, 401 F.2d 958, 977 (D.C.Cir.), cert. denied, 400 U.S. 965, 91 S.Ct. 367, 27 L.Ed.2d 384 (1970); accord United States v. Forrest, 623 F.2d at 1115; United States v. Werner, 620 F.2d at 930. Defendant has failed to make any showing in this regard.

CONCLUSION

Defendant’s motion for severance is denied.

      . The conspiracy to defraud the United States could be the subject of inquiry at a separate trial on the "Travel Act” count if the defendant were to testify. See Fed.R.Evid. 608(b), 609. If the defendant were to elect not to testify at a separate "Travel Act” trial, the conspiracy charge, likely would not be introduced. The defendant does not assert that the inclusion of the conspiracy charge unfairly prejudices him with respect to the “Travel Act” charge.