author: NORTHROP, Senior District Judge.

text:
    Evora A. ROBINSON v. VITRO CORPORATION, et al.
    Civ. A. No. N-85-2672.
    United States District Court, D. Maryland.
    Oct. 10, 1985.

      David L. Moore, Marianna I. Burt, and Kenneth C. Montague, Baltimore, Md., for plaintiff.
    George W. Johnston, Peter S. Saucier, and Venable, Baetjer & Howard, Baltimore, Md., for defendants.
   MEMORANDUM

NORTHROP, Senior District Judge.

Plaintiff filed suit in this Court on June 24, 1985, against her former employer (Vi-tro) and fellow employee (Ortega). She alleges that the defendants committed various acts against her, including employment discrimination and retaliatory discharge, in violation of 42 U.S.C. § 1981, and pendent state claims of false light invasion of privacy, and intentional infliction of emotional distress. The defendants timely moved for dismissal, or in the alternative for summary judgment, on all the claims. After reviewing the pleadings and affidavits, the Court concludes that no hearing is necessary for decision in this matter. Local Rule 6, D.Md. For reasons hereinafter set forth, the motion is granted in part and denied in part.

FACTS

The plaintiff, Evora A. Robinson, began working for the defendant, Vitro Corporation (“Vitro”) on or about January 15,1979. Her principal responsibility was that of a projectionist, and as such, she made audiovisual presentations to various groups assigned to her by her supervisors. The plaintiff contends that during her employment with Vitro, she was on numerous occasions required to make visual presentations to a group of people headed by Frank Ortega, and that each time she made a presentation before Mr. Ortega, he unfairly complained about her work to her supervisor, making racially derogatory remarks in the process. Ms. Robinson asserts that upon consulting with her supervisor about Mr. Ortega’s conduct, the supervisor alerted the employee relations office and Vice President of Industrial Relations to the fact that Ms. Robinson was being subjected to racially motivated harassment. Despite this notice, the company did nothing to terminate Ortega’s conduct.

Ms. Robinson filed charges of race, sex and age discrimination with the Maryland Human Relations Commission on March 20, 1984. That charge is still pending before the Commissioner. The plaintiff was subsequently notified on May 21,1984 that she was being laid off as part of a reduction in force effective June 1, 1984, and in fact did end her employment with Vitro on that date.

For purposes of clarity, the Court will deal with each of defendants arguments separately.

I.Specificity of Pleading under Federal Rule 8(a)(2)

The defendants first argue that the entire complaint lacks the specificity required by FED.R.CIV.P. 8(a)(2) and, therefore, should be dismissed. They contend that since the complaint fails to identify sufficient dates, witnesses, and surrounding facts, the defendants are unable to respond effectively to the allegations. While the Court notes that the complaint is not replete with specific information regarding each count, it does adequately inform the defendants of the nature and basis of the complaint. The complaint clearly states the following: Throughout the plaintiff’s employment, defendant Ortega constantly complained about Ms. Robinson’s work to her supervisor; these criticisms were unfounded and motivated by racial prejudice; Ortega claimed that Ms. Robinson was deficient because she was black; Ortega called her “Nigger” in the presence of others; even after the defendant Vitro learned of the wrongful conduct by its employee Ortega, it failed to take any action to stop the abuse and harassment directed toward the plaintiff.

Federal Rule of Civil Procedure 8(a) does not require that a claimant set forth in detail all the facts upon which she bases her claim. The rule simply requires a short and plain statement of the claim that will give the defendant notice of the nature of the claim and its grounds. The opportunity for discovery will enable the defendant to ascertain additional necessary facts. Conley v. Gibson, 355 U.S. 41, 47-48, 78 S.Ct. 99, 102-03, 2 L.Ed.2d 80 (1957). In Conley, the court succinctly ruled that “A complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Id. at 45-46, 78 S.Ct. at 101-102.

II.The Statute of Limitations under § 1981

The defendants have requested the Court to dismiss all claims of discrimination resting upon 42 U.S.C. § 1981. They contend that the plaintiff’s complaint does not identify specific dates upon which the alleged discriminatory conduct took place. Since the applicable statute of limitations for a § 1981 suit is three years and all but the last three months of plaintiff’s employment is barred by limitations, then the claim should be dismissed as a matter of law.

The defendants correctly have identified the applicable three-year statute of limitations. Burnett v. Grattan, 468 U.S. 42, 104 S.Ct. 2924, 82 L.Ed.2d 36 (1984). However, the plaintiff has asserted in her complaint that acts of racial discrimination occurred all throughout her employment with the defendant company. The plaintiff was employed by Vitro from January 15, 1979 until June 1, 1984. Therefore, the Court is not prepared to rule at this time that none of the alleged racially discriminatory acts occurred within three years prior to her filing suit.

III.Retaliatory Discharge under § 1981

As further grounds for dismissal, the defendants argue that the plaintiff may not maintain a § 1981 cause of action based on retaliation for filing a Title VII charge. The Court, however, disagrees and adopts the position in Evans v. Chesapeake & Potomac Tel. Co. of Maryland, 518 F.Supp. 1074 (D.Md.1981). Judge Miller ruled that when a plaintiff has alleged that an employer has taken retaliatory measures against an employee because the employee has filed Title VII charges alleging racial discrimination, then the plaintiff presents a cognizable claim for retaliation under 42 U.S.C. § 1981.

If an employer retaliates against the former employee with the intent to perpetuate the original act of discrimination, or with some other racially discriminatory motive in mind, then interference with rights protected by § 1981 has occurred, and that section must come into play.

Id. at 1078.

In the present case, Ms. Robinson asserts that she was discharged as a result of her filing a claim of racial discrimination with the Maryland Commission on Human Relations. She has thus satisfied the elements of a retaliation claim under § 1981.

The defendants next contend that the claim of retaliation must be rejected because the decision to lay off Ms. Robinson occurred before the defendant learned of her filing charges. Ms. Robinson, however, has asserted in her complaint as well as her affidavit that she filed her complaint with the Maryland Human Relations Commission on March 20, 1984, and on May 21, 1984, she was notified of her impending lay-off. Her complaint states that her discharge was due to “ill will towards the plaintiff in retaliation against her for filing her complaint.” Plaintiffs Complaint at 7-8. If this allegation were proven, it would certainly support a decision in her favor for retaliatory discharge under § 1981. Therefore, the Court cannot rule with certainty that Ms. Robinson’s termination from Vitro was unrelated to her filing charges with the Maryland Commission. Discovery will be most helpful in ascertaining when Vitro first learned of her claim with the Maryland Commission.

IV. False Light Invasion of Privacy

The defendants assert two grounds for dismissing the false light invasion of privacy claim. First, they contend that the complaint does not satisfy the elements of the tort; secondly, they argue that the claim is barred by the statute of limitations.

False light invasion of privacy requires publicity. The Court of Appeals of Maryland in Hollander v. Lubow, 277 Md. 47, 57, 351 A.2d 421, 426 (1976), cert. denied, 426 U.S. 936, 96 S.Ct. 2651, 49 L.Ed.2d 388 (1976) held: “The disclosure of the private facts must be a public disclosure, and not a private one; there must be, in other words, publicity....” The tort is distinguished from defamation which requires only publication, and can be completed upon communication to only one person. The defendants contend that the plaintiffs pleading fails to allege the requisite publicity, but, at this point, the record remains unclear as to the extent of any disclosure. The complaint simply states that defendant Ortega made his remarks in the presence of others. Hence, dismissal of the claim is premature.

In addition, the defendants state that any claim of false light invasion of privacy in now barred by the statute of limitations. Although the Maryland Court of Appeals has yet to rule on the applicable period of limitations for this tort, the Court concurs with Judge Miller of this District when he held in Smith v. Esquire, 494 F.Supp. 967, 970 (D.Md.1980) (Miller, J.) that the applicable time of limitations for false light invasion of privacy is one year. The Court agrees with Judge Miller’s reasoning that the tort of false light invasion of privacy is so similar to defamation that the one-year statute of limitations governing defamation is to be applicable in false light cases as well. As Judge Miller stated: “To hold otherwise would severely undercut the policy considerations which led to the enactment of the one-year statute governing defamation cases.” Id. at 970. The plaintiff alleges in her complaint that the false light invasion of privacy occurred during her employment at Vitro. She ended her working relationship with the defendants on June 1, 1984. Since her complaint was not filed with the Court until June 24, 1985, the claim of invasion of privacy is untimely and will be dismissed.

V. Intentional Infliction of Emotional Distress

The plaintiff has alleged that during her years of employment with the defendant, Vitro, the defendant Ortega subjected her to derogatory and disparaging remarks about her race and intelligence. The complaint further states that despite Vitro’s knowledge of the harassment, the company failed to take appropriate action. As a result of the defendants’ conduct, Ms. Robinson has suffered great emotional distress, mental pain, anguish, and irreparable harm. The defendants counter by suggesting that even if all the allegations are true, the complaint fails to allege conduct sufficient to be considered “extreme and outrageous” as required by the tort. In Dick v. Mercantile Safe Deposit & Trust Co., 63 Md.App. 270, 275-76, 492 A.2d 674, 677 (1985), the intermediary court approved the language of comment I to § 46 Restatement (Second) of Torts.

Liability has been found only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious and utterly intolerable. [Liability does not extend, however] to mere insults, indignities, threats, annoyances, petty oppressions or other trivialities. The rough edges of our society are still in need of a good deal of filing down, and in the meantime plaintiffs must necessarily be expected and required to be hardened to a certain amount of rough language, and to occasional acts that are definitely inconsiderate and unkind....

While the Court does recognize the language cited in Dick, it is not prepared to state at this time that the complaint as a matter of law lacks sufficient allegations to establish the requisite extreme and outrageous conduct necessary for the tort. Discovery will be helpful to ascertain the extent, magnitude and severity of the defendants’ alleged racial harassment.

Next, the defendants argue that notwithstanding the establishment of a claim for intentional infliction of emotional distress, such claim must be dismissed as to defendant Vitro because the Maryland Workers’ Compensation Act provides the exclusive remedy for that claim.

In Schatz v. York Steak House Sys., 51 Md.App. 494, 444 A.2d 1045 (1982), the Maryland Court of Special Appeals ruled that employees are not subject to vicarious liability for intentional torts committed by their servants. “No Maryland court has held that intentional acts of a vice-principal can be attributed to the employer. The majority of jurisdictions that have considered the question have held that absent express authorization by the employee, the agent must be the ‘alter ego’ of the employer in order for his intentional misconduct to be attributed to the employer.” Id. at 496-97, 444 A.2d at 1047. It is true that there is nothing in the complaint to suggest that Mr. Ortega held a position so important in the Vitro Company to infer that he acted as the alter ego of the company. However, the complaint, together with Ms. Robinson’s affidavit, clearly suggests that various persons in the company intentionally disregarded Ms. Robinson’s protestations and therefore directly participated in the wrongful conduct. The question which remains, and cannot be resolved at this time, is whether Ms. Robinson’s immediate supervisor, the employee relations office of Vitro, or the Vice President of Industrial Relations, all of whom, according to Ms. Robinson, learned of Mr. Ortega’s conduct, had sufficient authority to be considered the alter ego of the defendant Vitro.

Federal Rule of Civil Procedure 56(c) provides that summary judgment shall be rendered forthwith if “there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” The movant bears the burden “to demonstrate clearly that there is no genuine issue of fact, and any doubt as to the existence of such an issue is resolved against him.” Phoenix Savings and Loan, Inc. v. Aetna Casualty & Sure ty Co., 381 F.2d 245, 249 (4th Cir.1967); accord Cole v. Cole, 633 F.2d 1083, 1089-91 (4th Cir.1980); 10A C. Wright and A. Miller, Federal Practice & Procedure: Civil, § 2727 (1983). With this principle in mind, the Court must rule against the motion for summary judgment on the basis of worker compensation exclusivity.

The Court rules against dismissal against defendant Ortega because the Maryland Workmen’s Compensation Law contains no exclusivity rule for tort actions between employees. Hutzell v. Boyer, 252 Md. 227, 249 A.2d 449 (1968).

Finally, the defendants have asserted that any claim for intentional infliction of emotional distress is barred by limitations.

MD. [CTS. & JUD.PROC.] CODE ANN. § 5-101 states that Maryland subscribes to a three-year limitation unless another provision of the Code provides a different period of time within which an action shall be commenced. Section 5-105 does mandate a one-year limitation of action for assault, battery, libel, or slander.

The defendants suggest that the tort of intentional infliction of emotional distress is so closely analagous to the torts enumerated in § 5-105 that the Court should apply the one-year limitation for this tort. The defendants further contend that this Court should apply the same rationale as did Judge Miller in Smith v. Esquire in which Judge Miller held that the one-year statute of limitations under § 5-105 was to be extended to false light invasion of privacy because of its close similarity to libel and slander. While this Court concurs with the holding in Smith, it does not believe that the tort of intentional infliction of emotional distress is so closely analagous to that of assault as to warrant inclusion under § 5-105.

An assault is any unlawful attempt to cause a harmful or offensive contact with the person of another or to cause apprehension of such a contact. Continental Cas. Co. v. Miralile, 52 Md.App. 387, 398, 449 A.2d 1176, 1183. The tort of assault is designed to protect a person’s interests to be free from apprehension of intentional physical contact.

On the other hand, the tort of intentional infliction of emotional distress was recognized to protect persons from any extreme and outrageous conduct calculated to cause serious mental distress. Harris v. Jones, 281 Md. 560, 564, 380 A.2d 611, 613, 86 ALR 3d 441 (1977). The interests being protected are thus distinct.

In Stewart v. Thomas, 538 F.Supp. 891 (D.D.C.1982), Judge Green of the District Court for the District of Columbia dealt with the same issue and found that the tort of intentional infliction of emotional distress was not to be included among the torts enumerated in the D.C.Code having a one-year statute of limitations (libel, slander, assault, battery, mayhem, and false imprisonment). The Court agrees with that holding.

MD. [CTS & JUD.PROC.] CODE ANN. 5-101 states that “A civil action at law shall be filed within three years from the date it accrues unless another provision of the Code provides a different period of time within which such an action shall be commenced.” The Maryland Court of Appeals has further cautioned that “where the Legislature has not made an exception in express words in the Statute of Limitations, the Court cannot allow any implied and equitable exception to be engrafted upon the Statute merely on the ground that such exception would be within the spirit or reason of the statute.” McMahan v. Dorchester Fert. Co., 184 Md. 155, 160, 40 A.2d 313, 316 (1944).

The Court therefore concludes that it lacks sufficient reason for engrafting the tort of intentional infliction of emotional distress onto MD. [CTS. & JUD.PROC.] CODE ANN. § 5-105.

VI. Staying the Action

The defendants contend that since the basis of the plaintiff’s complaint is that she suffered discriminatory treatment while employed at Vitro, and since this is the same issue which she has brought before the Maryland Commission on Human Relations, it would be logical, efficient and economical to allow the Commission first to address, investigate and, hopefully, to conciliate her complaint.

Although the plaintiff opposes such a stay on the grounds that such a stay would be prejudicial to her case, the Court is persuaded by the possible benefits of such a stay, and on balance finds that the potential advantages of allowing the Human Relations Commission to complete its investigative and eoncliatory function far exceeds any potential prejudice to the plaintiff.

VII. Attorney’s Fees

Finally, the plaintiff has claimed attorney’s fees for her § 1981 actions, as permitted under 42 U.S.C. § 1988. The Court concludes that there is little justification for permitting the award of attorney’s fees at this time. Therefore, the request will be denied pending litigation on the merits of the § 1981 claim.

A separate Order will be entered confirming the rulings made herein.

      . The parties are in dispute over the existence of other possible claims. The defendants assert that the plaintiff attempted to bring actions solely under the Thirteenth and Fourteenth Amendments to the United States Constitution. The plaintiff, in her memorandum in opposition to dismissal, has indicated no such intent. The Court finds that the complaint could be read to infer such an allegation, but that any such claims must be dismissed under FED.R.CIV.P. 12(b)(6). The parties are additionally in conflict over whether the plaintiff has alleged defamation. The plaintiff, in her memorandum, indicates that she made no such allegation. The Court rules without further discussion that any action for defamation is hereby dismissed, since any defamation must have occurred outside the one-year statute of limitations. MD. [CTS. & JUD.PROC.] CODE ANN. § 5-105. In addition, the plaintiff, in her memorandum, has outlined an argument in favor of a claim for abusive discharge. Upon careful reading of the complaint, however, the Court finds no such claim. Therefore, no discussion on the matter or ruling will be considered by the Court.

      . The defendants have asserted in their memorandum in support of dismissal that Vitro had decided to lay off Ms. Robinson on or about April 25, 1984 and that the company received notice of Ms. Robinson’s charges by mail from the Commission on May 10, 1984. Thus, the decision to lay off the plaintiff could not have been motivated by any desire to retaliate. The argument, however, rests on the assumption that Vitro could only have learned of Ms. Robinson’s Title VII action by mail from the Commission itself. The Court cannot accept this assumption with legal certainty.

      . In Hector v. Weglein, 558 F.Supp. 194, 207 n. 7 (D.Md.1982) (Kaufman, C.J.), Chief Judge Kaufman of this District suggested in dicta that in Maryland, the torts of false imprisonment and malicious prosecution appeared to be subject to the general three-year limitations period provided by MD. [CTS. & JUD.PROC.] CODE ANN. 5-101.


source: Caselaw Access Project

author: WARREN, District Judge.

license: Public Domain

text:
    BOXHORN’S BIG MUSKEGO GUN CLUB, INC., Plaintiff, v. ELECTRICAL WORKERS LOCAL 494, INTERNATIONAL BROTHERHOOD OF ELECTRICAL WORKERS, Local 494 International Brotherhood of Electrical Workers, AFL-CIO, Its Officers and Members, et al., Defendants.
    No. 79-C-609.
    United States District Court, E.D. Wisconsin.
    Oct. 11, 1985.

      Thomas P. Krukowski, Krukowski, Chaet, Beck & Loomis, Milwaukee, Wis., for plaintiff.
    David Leo Uelmen, Goldberg, Previant, Uelmen, Milwaukee, Wis., for defendants.
   DECISION AND ORDER

WARREN, District Judge.

Plaintiff, Boxhorn’s Big Muskego Gun Club, Inc. (“Boxhorn’.’) commenced this action on August 2, 1979, alleging violations of Sections 1 and 2 of the Sherman Act, 15 U.S.C. §§ 1, 2 (1976) and Section 303 of the Labor Management Relations Act, 29 U.S.C. § 187 (1976). Named as defendants were various labor unions and individuals associated therewith. On December 10, 1982, the Court dismissed Boxhorn’s Sherman Act claims and on January 25, 1983, the Court dismissed the individual defendants from this action. The remaining issues were tried to this Court on May 23-27, 1983. The following constitutes the Court’s Findings of Fact and Conclusions of Law.

I. Background

Dick and Lois Bennett purchased Box-horn in 1971. Boxhorn is a trapshooting facility and retail store providing trapshooting equipment and supplies. The facility consists of numerous trap fields, a clubhouse, a recreation area and a restaurant and tavern. Boxhorn patrons participate in recreational and competitive trapshooting throughout the year.

Boxhorn’s business rapidly grew in the seventies necessitating an expansion of facilities. On two separate occasions, in 1974 and again in 1978, the Bennetts expanded Boxhorn’s facilities to accommodate the increased business. The 1978 expansion consisted of remodeling and expanding Box-horn’s restaurant, tavern and clubhouse. To perform this project, the Bennetts employed Gerald Glancey as general contractor who performed most of the carpentry work, but who subcontracted certain other work. A portion of this subcontracted work was performed by nonunion contractors who had union contractor competitors.

Glancey and the subcontractors used their own tools and materials in performing the construction. Boxhorn paid Glancey on a lump-sum basis and these payments contained no deductions for taxes, social security or worker’s compensation. Upon receiving payment for services rendered, Glancey and the subcontractors gave lien waivers to Boxhorn. Boxhorn employees did not perform any construction work and it was not involved in hiring or firing any employees of Glancey or the subcontractors. It is clear that there was not an employer/employee relationship between Boxhorn and Glancey or between Boxhorn and any of the subcontractors.

One of the nonunion subcontractors was Durski Electrical Contractors Co., Inc. (“Durski”). In early July, 1978, Durski’s electrical work on the expanded clubhouse was nearly complete when Ralph Gondek, business agent for the International Brotherhood of Electrical Workers, Local 494, met with Mr. Bennett and requested that he use only union labor. Bennett refused this request. At that time construction work on the clubhouse was nearly completed and work had begun on the tavern-restaurant.

Subsequent to this meeting, Gondek orchestrated a public appeal by the Milwaukee County Labor Council (MCLC) and the Milwaukee Building Construction Trades Council (MBCTC) to not patronize Boxhorn. Gondek was on the MCLC Board and was a delegate to MCLC and MBCTC. This public appeal concerned the nonunion electrical work performed by Durski at the Boxhorn construction project. The apparent purpose was to force Boxhorn to cease doing business with Durski and, instead, to employ union electrical contractors. The dispute centered entirely upon Durski’s nonunion status. Thus, the dispute was between Durski and the defendant.

The defendants took other actions to force Boxhorn into using only union contractors on its expansion project. First, on July 17, 1978, MCLC prematurely ended its trapshooting league at Boxhorn. Second, on July 19, 1978, Boxhorn was indefinately placed on MCLC’s “Do Not Patronize” list which requested that union affiliated persons cease patronizing Boxhorn. Finally, MCLC sent Mr. Bennett a letter stating that none of its members would patronize Boxhorn until it complied with their request. These tactics failed to influence the Bennetts.

The defendants then undertook bolder methods of influence. During portions of four days in late July or early August, 1978, Gondek, along with three other persons, distributed approximately 2,000 handbills to Boxhorn patrons at the club entrance. The handbills read as follows:

PLEASE DO NOT PATRONIZE BIG MUSKEGO GUN CLUB

The Milwaukee County Labor Council has withdrawn 42 teams in protest against Mr. Bennett’s decision to use non-union construction workers.
Our request to use Union Workers was scoffed at by Mr. Bennett.
You can help by withdrawing your team from Big Muskego Gun Club.

Electricians Local Union 494 IBEW The handbill distribution process consisted of one of the above-mentioned distributors positioning himself at the Boxhorn entrance thereby forcing an incoming vehicle to slow down or to stop. The distributor would then approach the driver’s side of the vehicle holding a handbill and conveying his intention to offer it to the driver. Upon accepting or refusing the handbill, the driver could proceed through the Box-horn entrance unhindered.

The defendant published the handbill in the July-August edition of its newspaper. Furthermore, a picture of the handbill held by the defendants’ agents appeared in the August 24, 1978 edition of the AFL-CIO Milwaukee labor press. These publications reached approximately 200,000 persons.

The parties dispute whether picketing occurred in conjunction with the handbilling. At trial, plaintiff presented four disinterested witnesses who testified that they observed picketing and the posting of picket signs at the Boxhorn entrance where the aforedescribed handbilling occurred. However, defendants presented one disinterested witness who testified that he did not observe any picketing or the display of picket signs on the days when handbilling occurred. The persons who conducted the handbilling also testified that no picketing transpired.

Boxhorn alleges that it suffered substantial monetary loss directly resulting from decreased business pursuant to defendants’ successful dissuasion of Boxhorn patronization. Boxhorn alleges that this dissuasion constituted unlawful secondary activities and that defendants should be held liable for the resulting damages. Defendants assert that their activities were protected by the publicity proviso to 29 U.S.C. § 158(b)(4). For the reasons stated below, the Court finds that the defendants’ activities violated 29 U.S.C. § 158(b)(4) and were not protected by the publicity proviso.

II. Whether Boxhorn Was A Primary Or Secondary Employer

Boxhorn’s cause of action is based on 29 U.S.C. § 158(b)(4) (1976). This section restricts a labor organization and its agents from using economic pressure where an object of it is to force an employer or other person to boycott someone else. NLRB v. Denver Bldg. Council, 341 U.S. 675, 687, 71 S.Ct. 943, 950, 95 L.Ed. 1284 (1950). This proscribed tactic is labeled a “secondary boycott.” Thus, a union is prohibited from striking or boycotting, or attempting to induce or encourage such action, “against employer A for the purpose of forcing that employer to cease doing business with employer B” with whom the union is engaged in a dispute. Id. Employer A is termed the “secondary employer” and employer B is termed the “primary employer.”

In its post-trial brief, defendants imply that Boxhorn was a primary employer since non-union contractors were hired to construct its expansion project. Defendants’ failure to steadfastly pursue this contention is warranted. The holding in Denver Building, supra, compels finding that Boxhorn was a secondary employer. That case involved a dispute between a union and a subcontractor at a construction site. The union engaged in a strike to force the site’s general contractor to terminate its contract with the subcontractor. The Supreme Court found that such action was unlawful secondary activity since the general contractor was a secondary employer.

The instant case presents even stronger reasons for finding that the union conducted secondary activities. In Denver Building the subcontractor was the primary employer and the general contractor was the secondary employer. The present case similarly involves a general contraetor/subeontractor relationship and the union’s dispute is with the subcontractor. However, the object of the union’s activities is not the general contractor (Glancey), rather it is Boxhorn. Therefore, the nexus between the dispute and the union’s activities is more remote than in Denver Building. Moreover, Boxhorn lacked any supervisory control over Durski. The Court therefore finds that Boxhorn was a secondary-neutral employer and it will proceed to determine whether the defendants’ activities directed against Boxhorn were unlawful.

III. The Legality of

Defendants’ Activities

A. Whether Defendants’ Activities

Constituted Coercion

Section 8(b)(4)(ii)(B) of the National Labor Relations Act, as amended, 29 U.S.C. § 158(b)(4)(ii)(B) (1976), prohibits coercion where the purpose thereof is to force or require any person “to cease doing business with any other person.” By handbill-ing, publishing a copy of the handbill, picketing (discussed infra) and placing Box-horn on its “Do Not Patronize” list, defendants advocated a consumer boycott of Box-horn. As stated above, these activities were undertaken to force Boxhorn into terminating the use of non-union subcontractors on its expansion project. This Court finds that the defendants’ actions constituted coercion within the broad scope of 29 U.S.C. § 158. Building Trades Councel (DeBartolo Corp.), 273 N.L.R.B. 172 (1985); Edward J. DeBartolo Corp. v. NLRB, 662 F.2d 264, 271, (4th Cir.1981), rev’d on other grounds, 463 U.S. 147, 103 S.Ct. 2926, 77 L.Ed.2d 535 (1982); see, Longshoremen v. Allied International, Inc., 456 U.S. 212, 225, 102 S.Ct. 1656, 1664, 72 L.Ed.2d 21 (1981).

B. Whether Defendants Are Protected By The Publicity Proviso

Initially, the Court must resolve Box-horn’s contention that defendants are precluded from asserting the protection of the publicity proviso because they failed to plead such protection as an affirmative defense. Boxhorn relies on NLRB v. Teamsters, Local 126, 435 F.2d 288 (7th Cir.1970) wherein the Seventh Circuit found that the existence of an “ally relationship” is an affirmative defense which the unions had the burden of proving. Boxhorn cites no precedent that labels the publicity proviso an affirmative defense. Similarly, the Court is unaware of any requirement, either precedential or statutory, that a defendant must plead the protection of the publicity proviso. The Court will impose no such requirement in this case.

Defendants contend that their activities are exempted from 29 U.S.C. § 158(b)(4) pursuant to the publicity proviso contained therein. Defendants are protected by the proviso if the following factors were present.

(1) Defendants’ actions constituted publicity other than picketing;
(2) there was a producer-distributor relationship between the non-union subcontractors and Boxhorn;
(3) the publicity was truthful; and
(4) the effect of the publicity did not result in the interference with deliveries or work stoppage of any employees of any person other than those employed by the employer with whom the union has a primary dispute.

It is undisputed that the fourth factor existed. Thus, analysis of the remaining three factors must be undertaken.

1. Picketing

At trial, Boxhorn presented four witnesses who testified that they observed picketing at the Boxhorn entrance on the days when defendants’ agents were present there. From a distance, these witnesses observed individuals pacing at the Boxhorn entrance while holding picket signs approximately 18" by 20" in size. One witness testified that the signs stated “AFL-CIO, Job Action, Local 494.” These witnesses were disinterested and indeed some of them were members of unions other than the defendants. The Court considers such testimony highly credible.

The defendants presented testimony supporting their position that they did not picket. One witness, Mr. Leo Bednarski, testified that he observed no picketing at the Boxhorn entrance on the four days when defendants’ agents were handbilling. However, Mr. Bednarski did not testify that he constantly observed the defendants’ agents the entire time that they were present at the Boxhorn entrance. The Court finds Mr. Bendarski’s testimony credible. Furthermore, at trial the defendants’ handbillers testified that no picketing occurred at the Boxhorn entrance.

Analyzing conflicting credible testimony to ascertain a factual finding is an extremely difficult task. Defendants urge the Court to discredit the testimony of Box-horn’s four disinterested witnesses because of various tangential inconsistencies in their accounts. The Court is not persuaded. It is more likely that these apparent inconsistencies exist because the observations occurred at different times; persons’ perceptions and subsequent descriptive accounts thereof naturally differ as to minor details; and over time peoples’ memories of minor details become blurred.

The Court finds that the defendants did perform picketing at the Boxhorn entrance. There may not have been constant picketing during defendants’ presence at the Boxhorn entrance, however some picketing did occur.

2. Producer-Distributor Relationship

Defendants assert that there existed a producer-distributor relationship between Durski and Boxhorn. That is, the labor performed by Durski composed a portion of the final product — trapshooting—which Boxhorn distributed, thereby establishing the relationship. Defendants’ position is on firm ground. Circumstances similar to the present existed in Edward J. DeBartolo Corp. v. NLRB, 463 U.S. 147, 103 S.Ct. 2926, 77 L.Ed.2d 535 (1982). That case involved a building contractor who was retained to construct a department store in a shopping center. There, plaintiff conceded that the department store was a distributor of products produced by the contractor. However, the Supreme Court stated in dicta that “[i]ndeed, we may assume here that the [publicity] proviso’s coverage ... is broad enough to include almost any primary dispute that might result in prohibited secondary activity.” DeBartolo, 463 U.S. at 155, 103 S.Ct. at 2932. This dicta carries the strong implication that the Supreme Court would have found a producer-distributor relationship regardless of the plaintiff’s concession. Moreover, International Brotherhood of Teamsters, Local 537 (Lohman Saks Co.), 132 N.L.R.B. 901 (1961), cited by the Supreme Court in conjunction with this dicta supports this position.

The Court finds that a producer-distributor relationship existed between Durski and Boxhorn.

3. Handbills’ Truthfulness

Boxhorn alleges that the handbills distributed by defendants were untruthful within the meaning of the publicity proviso since they failed to identify Boxhorn’s true relationship to the primary dispute. Defendants contend that absent an intent to deceive or a substantial departure from fact, a handbill failing to identify the primary employer by name does not lose its publicity proviso protection.

There appears to be a dispute between the Fourth and Ninth Circuits as to whether handbills distributed at the secondary employer’s premises must state the secondary employer’s relationship to the primary dispute. The Court is aware of no Seventh Circuit pronouncement on this matter. In Edward J. DeBartolo v. NLRB, 662 F.2d 264, 268, (4th Cir.1981), rev’d on other grounds, 463 U.S. 147, 103 S.Ct. 2926, 77 L.Ed.2d 535 (1982), the Fourth Circuit held that omission in the handbill of the secondary employer’s relationship to the primary dispute is, standing alone, not evidence of the union’s intent to deceive. There must also be an intent to deceive and a substantial departure from fact. To the contrary, the Ninth Circuit in Hospital & Service Employees Union v. NLRB, 743 F.2d 1417 (9th Cir.1984) found that the publicity proviso requires that publicity advise the public of the primary dispute’s nature and the secondary employer’s relation to it. In that case, handbills solely urging consumers to not patronize the secondary employer because it was unfair to organized labor were held unprotected by the publicity proviso.

The Court believes that it can resolve the present case without necessarily violating the mandates of either the Fourth or Ninth Circuit. The defendants distributed handbills at the Boxhorn entrance which requested that the public not patronize Box-horn. Furthermore, the handbills strongly imply, if not assert, that the defendants’ dispute is with Boxhorn’s owner, Mr. Bennett. There is no mention of the non-union subcontractors with whom defendants were engaged in the primary dispute. The Court finds that these handbills violated the Ninth Circuit’s requirement that handbills advise the public of the primary dispute’s nature and the secondary employer’s relation to it.

The Court also finds that pursuant to the Fourth Circuit’s test the handbills are not protected by the publicity proviso. The defendants intended to deceive the public with the handbills. Their agents attempted to make Boxhorn’s business suffer because of its involvement with the primary employer. Towards this end, the defendants’ handbilling exploited the pro-union sympathies of Boxhorn customers by dissuading their patronization of Boxhorn. Achieving this result hinged on the customers understanding that Boxhorn was responsible for hiring the non-union construction workers. The Court refuses to accept defendants’ contention that Boxhorn patrons would know that the handbilling was secondary activity simply because Boxhorn was not a construction firm. The handbills’ clear import is that Boxhorn hired non-union workers; the public could reasonably believe that Boxhorn was capable of such a hiring decision. Therefore, there was an intent to deceive. Moreover, this deception was material since it involved erroneously identifying the secondary employer as the primary employer.

The Court finds that the defendants’ handbills were untruthful and therefore are not protected by the publicity proviso. Likewise, publishing a copy of the handbill in two separate newspapers is not protected by the publicity proviso.

The Court finds that defendants’ placement of Boxhorn on its “Do Not Patronize” list constitutes an unlawful secondary activity. This action was done for the purpose of forcing Boxhorn to cease its business relationship with the primary employer — Durski. For the reasons stated above, this activity was not protected by the publicity proviso.

C. First Amendment Protection

The defendants contend that even if their activities were not protected by the publicity proviso they were protected by the first amendment. This Court initially finds that the defendants’ picketing was not protected by the first amendment. Longshoremen v. Allied International, Inc., 456 U.S. 212, 102 S.Ct. 1656, 72 L.Ed.2d 21 (1982).

The Court finds that the handbilling and reproducing the handbill in publications were also not protected by the first amendment. As stated above, the handbills’ contents were untruthful and were therefore not protected by the publicity proviso. To find that the handbills were however protected by the first amendment the Court would have to find the “truthfulness” aspect of the publicity proviso unconstitutional. The Court will not so rule. There is no persuasive reason or authority, and indeed the defendant has offered none, which compels finding that the first amendment protects untruthful communication designed to place economic pressure on a secondary employer. In enacting the publicity proviso, Congress has balanced the competing interests at stake. The Court defers to that balancing.

D. Summary of Findings

The Court finds that Boxhorn was a secondary employer. Furthermore, the defendants’ secondary activities directed towards Boxhorn constituted coercion and thus are covered by 29 U.S.C. § 158(b)(4). The Court finds that the defendants’ picketing, handbilling, publications depicting a picture of a handbill and placement of Box-horn on its “Do Not Patronize” list are not protected by the publicity proviso to Section 158(b)(4). Likewise, the first amendment does not protect these activities. Therefore, the Court finds that the defendants violated 29 U.S.C. § 158(b)(4) and the sole remaining issue concerns damages.

IV. Damages

Boxhorn seeks compensatory damages pursuant to 29 U.S.C. § 187(b) which states in pertinent part “[wjhoever shall be injured in his business or property by reason of [Section 8(b)(4) ] ... shall recover the damages by him sustained and the cost of the suit.” In a case such as the present the injured party is not required to establish its monetary damages to a degree of absolute certainty. Moreover, defendants here bear the risk of any uncertainty. Story Parchment Co. v. Paterson Co., 282 U.S. 555, 51 S.Ct. 248, 75 L.Ed. 544 (1931).

Relying on Teamsters Local 20 v. Morton, 377 U.S. 252, 84 S.Ct. 1253, 12 L.Ed.2d 280 (1964) and United Mine Workers v. Gibbs, 383 U.S. 715, 84 S.Ct. 1130, 16 L.Ed.2d 218 (1965), defendants contend that in a situation where both legal and illegal union activity took place, Boxhorn’s recovery, if any, must be limited to losses proximately caused only by the illegal activity. But, Morton and Gibbs involved situations where the legal and illegal activity could be separated in a reasonable and logical fashion. The present case’s circumstances involve such an intertwining of legal and illegal activity and their resulting effects that similar separation is rendered impossible. The Court is similarly unpersuaded by defendants’ argument that the “unlawful objective” discussion in Mead v. Retail Clerks Int. Ass’n., Etc., 523 F.2d 1371, 1379 (9th Cir.1975), is controlling here. In Mead, the Ninth Circuit discussed a requirement that the unlawful objective, standing alone, must have caused the injury. Id. However, the Mead court went on to add that evidence supporting a “just and reasonable inference” that the unlawful activity caused the harm sufficiently establishes damages in a secondary boycott case. Id. The Court finds in the present case that there is a “just and reasonable inference” that the Union’s unlawful activity caused Boxhorn’s damages.

At trial the plaintiff proffered evidence to prove its damages by two different approaches in an effort to provide the Court with a reasonably certain means of approximating the losses suffered by plaintiff as a result of the violation of Section 8(b)(4).

The first approach involved the direct calculation of damages based on the testimony of Dick and Lois Bennett. After purchasing the club in 1971 they made extensive efforts to expand club membership. Mr. Bennett testified that prior to the boycott in 1978 they had 1,892 members (Tr. p. 104). He further stated that in their business planning current members were considered the best form of advertising and calculated that, given their constant promotional activity and word-of-mouth advertising, Boxhorn could expect a 15% annual gain in total membership. This rate of growth had been realized before July, 1978, but after the picketing there was a precipitous drop. Based on the number of team withdrawals, an examination of the trap shooting score cards and their personal knowledge of the reasons causing others to drop out, the Bennetts calculated that they lost 416 members because of the Union’s illegal activity. Mr. Bennett testified that in his experience each shooter was worth approximately $450.00 in gross sales per year. This figure consisted of sales of targets, shells, reloading components, guns, clothing, membership fees, and related equipment and accessories. Cost of goods sold took approximately 79.39% of Boxhorn’s gross sales (Tr. pp. 108, 109). He also testified that within limits, fixed operating costs were not increased when membership increased. Finally, Mr. Bennett testified that there was a net profit of 20.61% of gross sales.

Under a condition where incremental operating expenses are nominal, gross profits from the sales may properly be considered in assessing damages. Trabert & Hoeffer, Inc. v. Piaget Watch Corp., 633 F.2d 477 (7th Cir.1980). Plaintiff calculated its loss of revenue based on the 416 members who withdrew or dropped out, the 15% increment per year in members thereon, its gross sales per member, and its costs of goods sold rate of 79.39% of sales. The calculation encompassing these factors resulted in the net profit figure. Plaintiff then applied an interest factor to this net profit figure because these funds were not available for investment. Calculation by this formula resulted in a 1978 damage estimate of $42,766.00. (See Appendix A to Plaintiffs Post Trial Brief). Adjusted for the occurrence in mid-summer (the 1978 figure multiplied by .45833 or 11/24), plaintiffs arrive at a loss of retail sales of $19,601.00 for 1978. Boxhorn applies similar methodology to succeeding years. (The calculations ignore approximately $300,000.00 in gross wholesale sales at salvage which Bennett calculated were lost.)

The Court concurs with the general formula utilized above as leading to a “just and reasonable approximation,” Rodgers v. Musicians Local 8, 403 F.Supp. 870 (E.D.Wis.1975), or as “circumstantial evidence based on reasonable assumptions,” Spray-Rite Service Corp. v. Monsanto Co., 684 F.2d 1226 (7th Cir.1982) providing it is not extended excessively far into the future. The impact of loss of members will dwindle with each passing year. This Court cannot accept Boxhorn’s projection that damages will run for nine or ten years into the future. (Plaintiffs Post-Trial Brief Appendix A.)

The other method of assessing damages used at trial was the testimony of Dr. Richard Kaimann, a Professor in the College of Business at Marquette University and the head of Kaimann & Associates, a management consulting firm. He used a regression analysis technique wherein he examined the financial performance of Box-horn at various pivotal periods during its history and determined a projected rate of growth for the period from March of 1971 to July of 1978. Dr. Kaimann then compared this rate to the actual growth after the Union’s unlawful activities in the summer of 1978. Using this method, Dr. Kaim-ann testified that between 1971 and 1978 plaintiff had growth in gross sales of $2,168.00 per month but between July 1978 and 1980 the sales growth rate flattened out to the point where the demonstration chart (Ex. 35A) shows a virtually horizontal line subsequent to July 1978. The witness further testified that as additional data points were calculated after October, 1980, based on the financial statements and computer calculations therein (Exhibits 35B, C & D), this growth line actually turned negative (Tr. 262). Dr. Kaimann calculated the difference between the two growth lines, applied an interest factor of 10.845% (which he said was the average for 3-month treasury bills for the period 1979 to 1980) calculated a discount figure of 7%, and arrived at a total damage figure for year 4 (1986) of $827,223.00 (Ex. 35D). His calculations of damages to the year of 1983 (year 1 on Ex. 35D) was $410,910.00. The year 1986 was when Kaimann calculated that plaintiff would go out of business based on the projected sales line turning negative. (Dr. Kaimann’s analysis did not exclude wholesale figures.)

The testimony of Dr. Kaimann was contradicted by that of Joseph Butala. According to Mr. Butala’s analysis total sales did not decline in 1978 or 1979. Defendants argue that both the net income before and after taxes increased over the years and they contend that there is great doubt that plaintiffs suffered any loss to their business during the period 1978-1980.

The Court is satisfied that the plaintiff was in fact damaged by a concerted campaign to “get Bennett” which was orchestrated by defendants. Further, plaintiff has suffered a substantial loss. The Court has determined that some of the activity of the unions was protected but some clearly violated Section 303. As indicated above, the Court concludes that there is no feasible way of precisely separating the results of legal activity from the results of the illegal activity. The plaintiffs having been damaged by the violations of 29 U.S.C. § 187(a), the Court concludes the direct approach to the calculation of damages represented by the Bennetts’ testimony is more precise than that employed by the least squares regression approach of Dr. Kaim-ann. It does note that on the critical issue regarding the extent to which damages' should be projected into the future even Dr. Kaimann testified that it would be “difficult and conceptually erroneous” to project damages beyond four years. The Court agrees. Considering the imprecise nature of damage calculations in secondary boycott cases, the Court is convinced that the Bennett calculations projected over four years and adjusted for interest is “just and reasonable.” Mead, supra. This just and reasonable approximation can appropriately be used to set damages in this case since the risk of uncertainty “should be thrown upon the wrongdoer instead of upon the injured party.” Story Parchment Co. v. Paterson Co., 282 U.S. 555, 563, 51 S.Ct. 248, 250, 75 L.Ed. 544 (1930).

Accordingly the Court finds damages to Boxhorn as follows:

1978 (11/24 of year) $19,601.00
1979 49,140.00
1980 56,542.00
1981 64,972.00
1982 (13/24 of year) 40,483.00
$230,738.00

Defendants are ordered to pay Boxhorn damages in said amount, said liability being joint and several.


author: WARRINER, District Judge.

text:
    GREAT AMERICAN INSURANCE COMPANY v. CAVALIER PRINTING INK COMPANY, INC.
    Civ. A. No. 85-0514-R.
    United States District Court, E.D. Virginia, Richmond Division.
    Oct. 11, 1985.

      R. Craig Jennings, Kevin L. Locklin, Slenker, Brandt, Jennings & Johnston, Fairfax, Va., for plaintiff.
    J.W. Morris, John M. Claytor, Carrie L. Camp, Browder, Russell, Morris & Butcher Richmond, Va., for defendant.
   ORDER

WARRINER, District Judge.

A fire occurred at the premises of Cavalier Printing Ink Company, Inc., on 4 June 1984. Surrounding premises were severely damaged or destroyed as the fire spread. Among the persons whose property was damages or destroyed by the spreading fire were R.W. and Mildred H. Harper, Saxony Shoes, Inc., S.G. Frantz Company, Inc., and Wilson Feed Company, Inc. Entities which are or may be legally liable for the damages caused by the fire are Cavalier Printing Ink Company, Inc., Wolff-Walsrode, A.G., Mobay Chemical Corporation, and Contract Marine Carriers, Inc.

In February of 1985, several of the injured plaintiffs filed their several actions against the four defendants in the Circuit Court of the City of Richmond. While there appears to have been substantial preparation for discovery, actual discovery has not been substantial and no trial date has been set. If a trial date were sought, it appears that the Court would set trial for the spring of 1986. The aggregate of damages sought by the several plaintiffs is over $4,000,000. Cavalier had insurance coverage of $1,500,000. It is not known what assets or insurance coverage the other defendants may have. It has been suggested that the damages to Saxony Shoes are relatively slight. The Harpers claim a loss of over a million dollars. They have been paid approximately $200,000 by their insurance carrier, Great American Insurance Company. Great American is subro-gated to the Harper’s claim pro rata. Rather than seek to recover the full amount of the loss in the Harper suit pending in State court, Great American in May of 1985 filed a claim in this Court for its subrogated share of the Harper claim.

Cavalier has asked this Court to stay the action on this subrogated portion of the claim. The motion was accompanied by an appropriate brief and exhibits to which plaintiff has filed its reply brief. Defendant’s rebuttal brief comes too late and will not be considered.

The parties agree that the decision is controlled by Colorado River Water Conservation District v. United States, 424 U.S. 800, 96 S.Ct. 1236, 47 L.Ed.2d 483 (1976) and Will v. Calvert Fire Insurance Co., 437 U.S. 655, 98 S.Ct. 2552, 57 L.Ed.2d 504 (1978). The Court believes these decisions must be interpreted in light of Moses H. Cone Memorial Hospital v. Mercury Construction Corporation, 460 U-S. 1, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983).

As Great American argues these cases the things to be considered by the Court in determining defendant’s motion are (1) comity, (2) promotion of judicial efficiency, (3) adequacy and extent of relief available in the alternative forum, (4) identity of the parties and of the issues in both actions, (5) likelihood of prompt disposition in the alternative forum, (6) convenience of parties’ counsel and witnesses, and (7) possible prejudice to a party as a result of the stay. I will consider the motion within the framework of plaintiff’s outline only adding that the granting of the motion must be based on extraordinary circumstances.

Comity is a two-way street but in this case the question of liability for causing the fire and the damages resulting from the fire were first presented to a State court. That court has taken jurisdiction and the processes of that court have been and are being used by the parties to move the suit along.

With respect to the promotion of judicial efficiency, it would be hard to imagine a less efficient way to have the insureds’ portion of the loss and the insurance com-party's portion of the loss litigated and determined. The one loss suffered by the Harpers has, by means of the parallel actions, been broken into two parts. One part will be heard by the State court and the other part by the federal court. Two juries will hear the identical evidence. Each will have to hear evidence as to the whole of the damages and each must establish liability on the basis of the same facts. The process chosen by Great American is the epitome of inefficiency.

The relief available in the State forum is the same as the relief available here. Indeed, if it be found that the other State court defendants shared in causing the fire or that one or the other of the other defendants is solely responsible for the fire, then the relief available in the State court would be measurably superior to the relief available here.

With respect to the Harper claim, Great American, as the Harpers’ carrier, stands in the shoes of the Harpers. Similarly, Great American stands in the shoes of Saxony. Hence there exists an identity of parties and issues.

This Court is setting cases currently in the winter and spring of 1986. The State court is setting cases in the late spring of 1986. The difference is insignificant.

There is no difference in the convenience of the two courts. They are located within four blocks of each other.

Plaintiff contends that there is a limited amount of money available to satisfy a judgment. By coming to federal court it hopes to obtain judgment more quickly and thus not be subjected to any sharing arrangement in settlement or otherwise which may grow out of the multiple contentions in the State court. In other words, plaintiff wants to grab its share and run.

Great American also claims that the State action may be more expensive. This claim has no moment. The work being done on behalf of the Harpers in State court is practically identical to the work that must be done here on behalf of Great American. By asserting their claims in a single action the expense to the litigants could be largely telescoped rather than duplicated.

Great American also asserts possible confusion in the State action. Confusion is generally a factor of poor preparation rather than of a multiplicity of parties. The question to be resolved is, who, if anyone, was culpable in starting the fire; what damages ensued. With all the plaintiffs and all the defendants present in one suit, this question can be answered authoritatively and lucidly. If the action be broken down into bits and pieces, as plaintiffs here seek to do, only confusion can be the result.

I consider the posture of the litigation extraordinary.

Plaintiffs motion for a stay is GRANTED. Upon a change of conditions the parties may move the Court to lift the stay at any time. In any event, the parties are to report to the Court on or before 30 June 1986 the status of the litigation in the State court.

And it is so ORDERED.