author: JOHN GARRETT PENN, District Judge.

text:
    APARTMENT SPECIALISTS, INC., Plaintiff, v. PUROLATOR COURIER CORP., Defendant.
    Civ. A. No. 85-0969.
    United States District Court, District of Columbia.
    Jan. 3, 1986.

      John Sherlock, Washington, D.C., for plaintiff.
    Peter A. Greene, Washington, D.C., for defendant.
   MEMORANDUM

JOHN GARRETT PENN, District Judge.

The plaintiff charges the defendant with breach of contract, negligence, and alleges that the contract was unconscionable and that plaintiff entered into the contract due to fraud, misrepresentation and detrimental reliance. The case is now before the Court on defendant’s motion for summary judgment.

I

The underlying facts are as follows: The plaintiff is engaged in the manufacture and installation of commercial draperies and depends for a substantial part of its business on Federal Supply Schedule contracts let by the United States government pursuant to the Federal Property and Administrative Services Act of 1949, which is codified in various titles of the United States Code. Plaintiff alleges that it was a successful bidder under the Federal Supply Schedule for each of the four years prior to 1983 and received orders totaling 1.5 million dollars on contracts awarded as the result of a 1982 solicitation.

On or about October 13, 1983, the United States General Services Administration (GSA) Procurement Division published a Notice of Solicitation Number BO/FS-K-00454(n) for the provision of draperies, drapery hardware, bedspreads and for optional measuring and installation services. In order to be considered for the solicitation, bids were to be received by GSA’s Procurement Division in Boston, Massachusetts, no later than 4:30 p.m. (Eastern Standard Time) January 12, 1984. On January 11, 1984, between 10:00 a.m. and 11:00 a.m. (Pacific Standard Time) the defendant’s messenger picked up the bid package for the subject solicitation from the plaintiff’s Los Angeles offices for delivery to GSA in Boston. Plaintiff alleges in its complaint that the box containing the bid package was clearly marked as a bid and bore the date and time of the bid opening. Plaintiff contends that a representative of the defendant was informed, prior to defendant’s acceptance of the package, that the package contained a government bid and that it was essential that the package be delivered to GSA in Boston no later than 4:30 p.m. January 12, 1984. The package was marked as “Urgent” and “Rush”. Unknown to the plaintiff, it had snowed in Boston on January 10, 1984, and January 11, 1984. The defendant did not advise the plaintiff that the delivery of the package might be delayed because the defendant was experiencing difficulties with its Boston operations which it attributed to the adverse weather conditions in the Boston area. The package was not delivered until January 13, 1984 at 9:20 a.m. and as a result, the bid was not accepted by GSA. It is not clear when the package actually arrived in Boston, but it is conceded by the defendant that the package was sent to the Purolator office in Boston and, from that office, was delivered to GSA which is within two blocks of the defendant’s Boston address.

II

The question of an air carriers’ limitations of liability is governed by federal law. See First Pennsylvania Bank v. Eastern Airlines, Inc., 731 F.2d 1113 (3d Cir.1984); Ragsdale v. Airborne Freight Corp., 173 Ga.App. 48, 325 S.E.2d 428 (1985).

At the time the package was delivered to the defendant, the parties executed a written contract of carriage, Bill of Lading (bill) No. 18363998, which was signed by Stan Nathanson on behalf of the plaintiff and by defendant’s carrier guard. The bill is addressed to the General Services Administration in Boston and indicates that it is from the plaintiff in Los Angeles. In the item provided for the declared value of - the contents of the package there appears the figure “0”. The plaintiff contends that “0” was written in by the defendant’s agent. Directly under the signature of Mr. Nathanson is a statement which reads “NEGOTIABLE BILL OF LADING SUBJECT TO CONDITIONS OF CONTRACT SET FORTH ON REVERSE SIDE OF SHIPPER'S COPY”. There is also a block for the “description of contents”, however, that block is blank. There is also on the front side of the bill a notation “unless greater value is declared hereon, the shipper hereby agrees and declares that the value of the property described herein is released to a value as specified on the reverse side of the shipper’s copy.” On the reverse side of the bill, there is a statement with respect to the limitation of liability which also includes a statement that, “[i]n no event will Purolator be liable for special or consequential damages including but not limited to loss of profits or income. In case of the loss or damage of a shipment with a number of pieces, the value of the shipment will be prorated over the number of pieces.” The bill also provides that “[d]ue to the nature of the business, Purolator cannot guarantee delivery by a stipulated date or by a stipulated time, nor shall Purolator be liable for the consequences of delay, misdelivery or the failure to deliver.” Finally, the bill of lading provides that “FOR ALL CURRENT RULES, REGULATIONS AND RATES, SEE PUROLATOR’S SERVICE GUIDE OR, IF APPLICABLE, ITS TARIFF AVAILABLE FROM ALL PUROLATOR OFFICES.” The defendant’s service guide in effect in January 1984 sets forth similar limitations of liability and clearly advises shippers that the defendant will not be liable for failure to deliver by a stipulated time or date, and that the defendant “in no event shall be liable for any consequential, incidential or special damages which may arise from loss, damage, nondelivery or delay of any shipment.” The guide also provides that “if the shipment involves a bid or other similar extremely time-sensitive material, the loss or delay of which might result in consequential, incidential or special damages, Purolator will accept such shipments, but subject to the limitations contained herein.” The guide contains additional limitations as to liability addressed to the failure to deliver or late delivery and acts of God such as inclement weather.

The plaintiff concedes that prior to January 13, 1984, it was never assured by anyone that the defendant Purolator would guarantee overnight delivery of the package or any package tendered to them. Nathanson Dep. at 162. Nathanson contends that such an assurance was made through defendant’s advertisement which reads “Overnight Not Overpriced”.

Plaintiff offers no evidence that the defendant engaged in fraud or misrepresentation since the bill of lading clearly sets forth the terms of the contract. Although the plaintiff contends that those terms are not clearly set forth in the bill, that argument is without merit. Directly under the signature of the shipper is a notation directing the shipper to the terms of a contract set forth on the reverse side of the bill. Moreover, the records reflect that the plaintiff had a copy of the defendant’s January 1984 service guide. Nathan-son Dep. at 143. The record further reflects that the plaintiff had made 49 shipments with the defendant prior to the shipment which is the subject of this action and therefore should have been familiar with the terms and conditions of shipment and the bill of lading which is a part of this action.

It is noted that in the affidavit of Mr. Nathanson filed in support of plaintiff’s opposition to the first motion for summary judgment, he states that “I was assured by defendant’s employees on January 11, 1984, that the bid package would be delivered on time on January 12, 1984.” Nathanson Affidavit 117. That affidavit was signed on August 6, 1985. However, on October 1,1985, Mr. Nathanson testified at his deposition, as indicated above, that he was never assured by anyone at Purolator, prior to January 13, 1984, that Purolator would guarantee overnight delivery of the package or any package delivered to them. Indeed, he further testified that he never personally contacted anyone at Purolator in an effort to obtain assurances of overnight delivery of the packages tendered to Purolator by the plaintiff. Finally in this regard, the Court notes that the contract entered into by the parties is complete in and of itself and the contract is unambiguous. The statement that the contract was somehow modified by oral representations of unknown persons employed by the defendant would not be admissible since it would violate the parol evidence rule. See District-Realty Title Insurance Corp. v. Ensmann, 767 F.2d 1018, 1022-1023 (D.C.Cir.1985).

The Court concludes that there are no genuine issues of material fact and that the defendant is now entitled to judgment as a matter of law. In sum, the terms of the contract are set forth in the written agreement between the parties and those terms cannot be modified by the alleged oral representations made by a representative of the defendant. Indeed, the record reflects that at no time did plaintiff receive a representation which guaranteed delivery of the package on or before the bid date.

The plaintiff made a business judgment. As Mr. Nathanson himself recognized, he could have delivered the bid directly himself but made a judgment to send the bid through Purolator. He must now live by that decision. In addition, as the defendant has demonstrated, the limitation of liabilities set forth by Purolator does not differ substantially from the limitation of liability utilized by other carriers in the same business. See reply to brief in opposition to summary judgment, Exhibit 1 (copies of bills of lading for Federal Express, DHL Worldwide Courier Express, and Airborne Freight Corp.)

Summary judgment will be entered for the defendant and this action will be dismissed. An appropriate Order has been issued.

      . In its original complaint filed on March 22, 1985, the plaintiff alleged only breach of contract. On September 20, 1985, after the defendant had moved for summary judgment, the plaintiff filed an amended complaint to assert the additional claims.

      . "When a motion for summary judgment is made and supported as provided in this rule, an adverse party may not rest upon the mere allegations or denials of his pleading”. Fed.R.Civ.P. 56(e).

      . At oral argument counsel appeared to agree that, while the bid package may have been clearly marked, that package was enclosed in a Purolator package which was not clearly marked as a bid. Nor was there any reference on the Bill of Lading that the package contained a bid.

      . Incorrectly stated in the complaint as January 10, 1985 and January 11, 1985. See First Amended Complaint ¶ 19.


source: Caselaw Access Project

author: POLOZOLA, District Judge:

license: Public Domain

text:
    Lewis W. HOLLOWAY, et al. v. COMBINED EQUITIES, INC., et al. Marguerite Leigh DIEFENBACH v. COMBINED EQUITIES, INC., et al.
    Civ. A. Nos. 83-359-B, 83-643-B.
    United States District Court, M.D. Louisiana.
    Jan. 9, 1986.
    John C. Anderson, Lemuel E. Hawsey, III, Anderson, Anderson, Hawsey, Rainach & Stakelum, Baton Rouge, La., for plaintiffs.
    James R. Austin, Boolus J. Boohaker, Baton Rouge, La., for Louisiana Nat. Bank of Baton Rouge.
    Andrew B. Ezell, Schott & Ezell, Baton Rouge, La., for David McCollister.
    Robert G. Jackson, Baton Rouge, La., in pro. per. and for Combined Equities, Inc., Combined Equity Securities, Inc., Combined Equity Services, Inc., Combined Equity Properties, Inc., Combined Equity Management, Inc., Combined Equity Real-ties, Inc., JSHB-80, A Louisiana Partnership, JSHB, Ltd., A Louisiana Ltd. partnership, Robert G. Jackson, Killearn, Ltd., a Louisiana partnership.

      John Dale Powers, Downing, Cazedessus & Powers, Baton Rouge, La., for American Bank of Lafayette.
    Claude F. Reynaud, Jr., Breazeale, Sachse & Wilson, Baton Rouge, La., for John Doe Ins. Co.
    Fred A. Palmer, III, Strain, Dennis, Palmer, Paul West, Roy & Kiesel, Baton Rouge, La., for Capital Bank & Trust of Baton Rouge and David McCollister.
   POLOZOLA, District Judge:

This matter is before the court on the motion of defendants Combined Equities, Inc., Combined Equities Securities, Inc., Combined Equity Services, Inc., Combined. Equity Realties, Inc., Combined Equity Properties, Inc., JSHB-80, Ltd., Killearn, Ltd., and Robert G. Jackson to dismiss for failure to state a claim upon which relief can be granted.

Plaintiffs allege that the defendants have violated 15 U.S.C. § 77e(a) and 111 (1) by-using the mails to sell unregistered securities. Plaintiffs contend that: (1) the securities in question were offered for sale in March of 1981; (2) the sales were made; and, (3) the purchase price of each unit consisted of a cash down payment, two installment notes, and a letter of credit. Plaintiffs further allege that payments were made on the installment notes in September and December of 1982.

The defendants contend in their motion to dismiss that plaintiffs’ claims under § 77e(a) and § 77Z (1) are time barred. The applicable statute of limitations is set forth at 15 U.S.C. § 77m, which provides in pertinent part:

No action shall be maintained to enforce ... a liability created under section 12(1) [15 U.S.C. § 111 (1) ], unless brought within one year after the violation upon which it is based.

This suit was filed on March 23, 1983. Combined Equities contends that the sale of the securities was complete more than one year prior to date suit was filed. In response to defendants’ motion, plaintiffs argue that the date from which the statute of limitations runs in this case is the date the last payment was made on the promissory note given in payment for the securities.

For reasons which follow, the court finds that the prescriptive period in this suit runs from the date of sale and not from the date the last payment is made on an installment note. Since this suit was filed more than one year from the date of the sale, plaintiffs’ suit is timed barred. Thus, defendants’ motion to dismiss must be granted.

Section 111 (1) provides a civil cause of action for violation of § 77e(a). Section 77e(a) states:

Unless a registration statement is in effect as to a security, it shall be unlawful for any person, directly or indirectly—
(1) to make use of any means or instruments of transportation or communication in interstate commerce or of the mails to sell such security through the use or medium of any prospectus or otherwise; or
(2) to carry or cause to be carried through the mails or in interstate commerce, by any means or instruments of transportation, any such security for the purpose of sale or for delivery after sale.

A cause of action based on § 77l accrues at the time that statute is violated. Folse v. Combined Equities, 592 F.Supp. 559, 562 (W.D.La.1984); Bryant v. Uland, 327 F.Supp. 439, 443 (S.D.Tex.1971). A “violation” for purposes of § 77l is committed “if the seller uses the mails or an instrument of interstate commerce to effectuate any one of the stages of the sales transaction or for delivery after sale____” Bryant, 327 F.Supp. at 444. For purposes of the limitation period in § 77m, the court must look to “which of the defendant’s activities —offer, sale, or delivery — occurred last.” Doran v. Petroleum Management Corp., 576 F.2d 91, 93 (5th Cir.1978).

The courts have broadly construed the terms “sale” and “delivery” as used in § 77e(a). Certain principles have been established by the jurisprudence. Thus, transactions such as mailing a confirmation of a sale or mailing certificates of ownership after a sale has been completed have been held by the courts to be violations of the securities act. However, the issue of whether the receipt of a payment on a promissory note given as part of the purchase price for a security constitutes a violation of the Securities Act appears to be res nova.

A careful review of the complaint reveals that delivery has not been pleaded. Therefore, plaintiffs’ claims under § 111 are timely only if all or part of the sales transaction occurred during the one year period prior to March 23,1983. It is uncontroverted that the only transactions which took place during this period were the installment payments on the promissory notes. Thus, the pertinent question which must be determined by the court is whether those payments completed the sale, as alleged by plaintiffs, or whether the payments were simply the fulfillment of an obligation separate and apart from the sale, as contended by the defendants.

The definition of “sale” provided in the Securities Act is of little help. 15 U.S.C. § 77b(3) simply provides: “The term ‘sale’ or ‘sell’ shall include every contract of sale or disposition of a security or interest in a security, for value.” Plaintiffs cite cases in which other district courts have held that a sale of a security on an installment contract is not complete for the purpose of § 77m until the final payment is made. Plaintiffs then attempt to analogize payments on the promissory notes in this case to payments on an installment contract. Plaintiffs’ argument is without merit and is unsupported by Louisiana law. In Louisiana a sale is complete when there is an agreement between the parties as to the object and the price. Unlike an installment contract, which is not perfected until the final payment is made, a contract of sale in Louisiana is perfected between the parties even if “the object has not yet been delivered, nor the price paid.” Louisiana Civil Code article 2456.

The court could only find one other case which has considered the issue now before the court. In Ingenito v. Bermec Corp., 376 F.Supp. 1154 (S.D.N.Y.1974), the court held that payments on a promissory note given as part of the purchase price did not constitute a sale. The plaintiffs in Ingénito contended, as do the plaintiffs in this case, that payments on promissory installment notes constituted sales and, therefore, were violations of the Act. However, the court held that the security interest “was purchased at the time of the initial sale and the rights and obligations of the parties were fixed at the time of the making of the note. Each payment represented not the creation or assumption of new obligations but the fulfillment of those previously created.” Ingenito, 376 F.Supp. at 1184. This court fully agrees with the analysis and decision made in Ingenito.

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. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957). In this case, plaintiffs have failed to plead facts sufficient to overcome the statute of limitations set forth in 15 U.S.C. § 77m.

Therefore:

IT IS ORDERED that the motion of Combined Equities, Inc., Combined Equity Securities, Inc., Combined Equities Services, Inc., Combined Equity Realties, Inc., Combined Equity Properties, Inc., JSHB80, Ltd., Killearn, Ltd., and Robert G. Jackson to dismiss plaintiffs’ claims under 15 U.S.C. § 77l (1) be, and it is hereby GRANTED.

      . The defendants will sometimes be collectively referred to as "Combined Equities.”

      . Paragraph 19 of the original complaint.

      . Paragraph 20 of the original complaint.

      . Paragraph 28 as amended in the fourth amended complaint.

      . See e.g., United States v. Wolfson, 405 F.2d 779, 785 (2d Cir.1968); Folse v. Combined Equities, 592 F.Supp. 559 (W.D.La.1984); United States v. Kane, 243 F.Supp. 746, 750 (S.D.N.Y.1965).

      . Plaintiffs cite four cases involving installment contracts, each of which can easily be distinguished factually from the instant case. In S.E.C. v. Royal Hawaiian Management Corp., Fed.Sec.L.Rep. (CCH) P 91,982 (D.C.Cal.1967), the title to the property was held by the seller as security for the full purchase price. This is a conditional sale which is prohibited in Louisiana. In Morrison v. Pelican Land Development, Fed.Sec.L.Rep. (CCH) P 98,863 (N.D.Ill.1982), the sale was deliberately structured so that it was not complete until the last payment was made. The court did not answer the question of when the sale was completed in Pfohl v. Pelican Landing, 567 F.Supp. 134, 139 (N.D.Ill.1983). Finally, Gross v. Independence Shares Corp., 36 F.Supp. 541, 543 (D.C.Penn.1941), involved a question of whether monthly installment payments on a savings plan was a sale so as to give the court jurisdiction under the Securities Act.

      . Louisiana Civil Code article 2456. A conditional sale in which title does not pass until the final payment is made is a legal impossibility in Louisiana. Wallace Lincoln-Mercury Co. v. Gentry, 469 F.2d 396, 402 (5th Cir.1972); Fisher v. Bullington, 223 La. 368, 65 So.2d 880, 882 (1953).

      . Although Ingénito was a case under § 10(b) of the Securities Exchange Act of 1934, the Fifth Circuit Court of Appeals has held that the definitions of the term "sale” under the 1933 and 1934 Securities Acts can be treated as functional equivalents. North Bank of Commerce v. All American Assurance, 583 F.2d 1295, 1298 (5th Cir.1978).


author: DIAMOND, District Judge.

text:
    John J. OBITKO, Plaintiff, v. OHIO BARGE LINE, INC., Defendant.
    Civ. A. No. 82-1856.
    United States District Court, W.D. Pennsylvania.
    Jan. 10, 1986.

      John M. Golden, Thomas J. Cordaro, Pittsburgh, Pa., for plaintiff.
    Anthony J. Polito, Leonard Fornella, Corcoran, Hardesty, Ewart, Whyte & Polito, Pittsburgh, Pa., for defendant.
   MEMORANDUM OPINION

DIAMOND, District Judge.

Plaintiff, John J. Obitko, commenced this action under the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. § 621 et seq. and the Pennsylvania Human Relations Act, 43 Pa.S.A. § 951 et seq. Presently before the court is the defendant’s motion for summary judgment which for the reasons set forth below will be denied.

I. BACKGROUND.

The following facts are stipulated by the parties in a pretrial stipulation. Plaintiff, John J. Obitko, was first hired by defendant, Ohio Barge Line, Inc., (“OBL”), on April 22, 1952; Obitko continued to work for OBL until it suspended Obitko from his job as a fleet watchman on December 20, 1980, and terminated his employment on January 5, 1981. Obitko was 57 years of age when he was terminated from his employment with the defendant. OBL filled the position of fleet watchman which previously had been held by the plaintiff with George Harden, age 58.

In September, 1982, plaintiff filed a complaint under the ADEA and the Pennsylvania Human Relations Act wherein he alleges that his discharge from OBL’s employment was “wrongful, willful and in bad faith.” In support of these allegations, the plaintiff asserts that: (1) he was discharged because of his age; (2) he was discharged prior to complete vesting of his pension benefits; (3) his discharge was a breach of his employment relationship with the defendant and did not comport with the reasonable expectations of the parties; and (4) OBL made no attempt to investigate allegations which were made against the plaintiff prior to his discharge.

Defendant maintains that it is entitled to summary judgment because the plaintiff has failed to demonstrate that he can produce sufficient evidence to establish a prima facie case of age discrimination under the ADEA. Specifically, defendant contends that while a prima facie case is not necessarily foreclosed when an employee is replaced by an older individual, replacement by an older employee creates an inference of non-discrimination; to overcome this inference the plaintiff must point to some other highly probative evidence of age discrimination to succeed. In this regard, the defendant asserts that the plaintiff has failed to produce any persuasive or probative evidence which can overcome the inference of non-discrimination created by the fact that he was replaced by an older person.

II. APPLICABLE LAW.

In a motion for summary judgment, the moving party must demonstrate that there is no genuine issue as to any material fact and that he is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c). In considering a motion for summary judgment, the court must determine whether the record indicates any issues of material fact, assume the resolution of any issue in favor of the non-movant and determine whether the movant is entitled to judgment as a matter of law. First Jersey National Bank v. Dome Petroleum Ltd,., 723 F.2d 335 (3d Cir.1983). See, e.g., Hollinger v. Wagner Mining Equipment Co., 667 F.2d 402, 405 (3d Cir.1981).

In order to dispose of the defendant’s motion for summary judgment, we must determine what the elements of a prima facie case and the proper allocation of the burden of proof are in cases brought under the ADEA. Our inquiry begins with McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), wherein the Supreme Court stated that in order to establish a prima facie case of disparate treatment under Title VII, the plaintiff must show:

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

McDonnell Douglas, at 802, 93 S.Ct. at 1824.

Although these guidelines arose in a Title VII case, they have been deemed applicable to cases arising under the ADEA. See, Smitkers v. Bailar, 629 F.2d 892, 894 (3d Cir.1980). Indeed, in Loeb v. Textron, Inc., 600 F.2d 1003 (1st Cir.1979), the First Circuit adapted McDonnell Douglas to cases where the plaintiff alleges that his employer’s decision to discharge him was motivated by age discrimination. In this type of case, the plaintiff must prove the following four elements to establish a prima facie case of age discrimination:

1. That he was in the protected age group; i.e., between 40 and 70;
2. That he was performing his job at a level that met his employer’s legitimate expectations;
3. That he nevertheless, was fired; and,
4. That after his discharge the position remained open and was filled by someone with similar qualifications.

Loeb, at 1013.

In the proof cycle in an employment discrimination case, making this type of prima facie showing is the first step in the proof of the ultimate issue of intentional discrimination. Whack v. Peabody & Wind Engineering Co., 595 F.2d 190, 193 (3d Cir.1979).

After a plaintiff has established a prima facie case of age discrimination; i.e., produced evidence sufficient to raise the rebuttal presumption of unlawful discrimination, the burden shifts to the defendant to come forward and articulate “some legitimate, non-discriminatory reason for the employee’s rejection.” Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 253, 101 S.Ct. 1089, 1093, 67 L.Ed.2d 207 (1981). If the defendant sufficiently articulates a non-discriminatory reason for the employee’s discharge, “the ultimate burden remains with the plaintiff to prove to the trier of fact that the defendant intentionally discriminated against the plaintiff.” Duffy v. Wheeling Pittsburgh Steel Corp., 738 F.2d 1393, 1395 (3d Cir.1984), cert. denied, — U.S. -, 105 S.Ct. 592, 83 L.Ed.2d 702 (1984).

We recognize that in Furnco Construction Corp. v. Waters, 438 U.S. 567, 98 S.Ct. 2943, 57 L.Ed.2d 957 (1978), the Supreme Court cautioned “that the McDonnell Douglas methodology should never be applied in a ‘rigid, mechanized, ritualistic’ manner.” Id. at 577, 98 S.Ct. at 2949. Indeed, in Furnco, supra, the Supreme Court explained that:

It is merely a sensible, orderly way to evaluate the evidence in light of common experience as it bears on the critical question of discrimination. A prima facie case under McDonnell Douglas raises an inference of discrimination only because we presume these acts, if otherwise unexplained, are more likely than not based on the consideration of impermissible factors____
To dispel the adverse inference from a prima facie showing under McDonnell Douglas, the employer need only “articulate a legitimate, nondiscriminatory reason for the employee’s rejection.” Citing, McDonnell Douglas.

Furnco, at 577-578, 98 S.Ct. at 2950-51.

A. Plaintiff’s Prima Facie Case.

Plaintiff contends that he has developed by deposition and answers to interrogatories a prima facie case sufficient to withstand defendant’s motion for summary judgment. It appears to be undisputed that plaintiff has established the first three factors outlined in Loeb v. Textron, supra, —1) that he was within the protected age group — he was 57 years old; 2) that he was qualified for the position he held; and 3) that he was involuntarily discharged. See, Loeb, at 1013.

However, it is the fourth requirement that provides the basis for the defendant’s motion for summary judgment. OBL does not deny that after Obitko’s termination OBL replaced the plaintiff with someone of similar qualifications. OBL, however, would have this court read into the McDonnell Douglas standard an implicit requirement that a plaintiff be replaced by a person younger than the plaintiff. In Maxfield v. Sinclair International, 766 F.2d 788 (3d Cir.1985), the Third Circuit addressed what was required to satisfy the fourth element of the McDonnell Douglas standard. Judge Sloviter, writing the opinion of the Court, stated:

In Elliott v. Group Medical & Surgical Service, 714 F.2d 556, 562 (5th Cir.1983), cert. denied, 467 U.S. 1215, 104 S.Ct. 2658, 81 L.Ed.2d 364 (1984), the Court [sic] that the fourth element of the McDonnell Douglas test could be satisfied by proof of either replacement by someone outside the protected class or by someone younger or by other proof that the discharge was because of age. That court had earlier recognized that age, unlike race or gender, is not an immutable characteristic, and that the realities of the workplace may demand that the replacement be experienced, thereby increasing the risk that the replacement might be over 40. McCorstin v. United States Steel Corp., 621 F.2d 749, 753-54 (5th Cir.1980)....
The probative value of the age of the replacement as evidence of discrimination will depend on the circumstances of the case. Although replacement by someone younger, without more, will not give rise to an inference of age discrimination, it has been noted that a substantial difference in the ages may be circumstantial evidence that gives rise to that inference, (citations omitted).

Maxfield, at 792. (emphasis supplied).

Because Fumco, supra, and Max-field, supra, reject the concept of a rigid prima facie formula under the ADEA, we conclude that although the McDonnell Douglas standard provides an appropriate starting point for the analysis of an age discrimination case, it cannot be viewed as establishing per se rules that all plaintiffs must meet.

Having rejected the application of a rigid prima facie test with respect to Obitko’s replacement, we must address OBL’s other contention that, even assuming that a prima facie case under the ADEA is not necessarily foreclosed when an employee is replaced by an older individual, the plaintiff has failed to produce any evidence which can overcome the inference of non-discrimination created by the fact that he was replaced by an older person.

However, we note the following excerpts from the deposition testimony of Obitko wherein he alleges that age was a factor in the defendant’s decision to terminate his employment:

Q What was the nature of the harassment? Was it harassment because of your age?
A Well, he was always riding me, telling me about my age and that, yeah
Q What sort of comments would he make?
A He said: You’re an old man. He said — and he told me plain right down on the landing boat: You’d do me a favor if you quit. I said: No, I’m not going to quit for nobody. Q Did he say: You would do me a favor if you would quit because you’re too old?
A He said I’m getting to be an old man, and he said that ... [t]here’s a new regime in down .there. And he said: It’s altogether different. I said: I know it is. I can’t see — I can read between the lines of what was going on !..
Q Are you saying the new regime wants younger people?
A Well, I don’t know whether they wanted younger people. I guess they did from the way it was told, harassing me. It looked like they wanted younger people in down there.
Q What attempts did they make to put younger people in?
A Well, I don’t know.
Q Do you have any evidence that they made any attempts to put younger people in?
A They put other people on the jobs down there.
Q I said younger people, not other.
A Younger fellows were hired.

Obitko’s deposition at pp. 19, 20 and 21.

Q What indications do you have, or from what can one infer the company’s motive and intent in discharging you was to discriminate on the basis of age?
A I don’t know; to me it looks like from the way [plaintiff’s supervisor] would harass me about my age or that. I figured they wanted to get rid of me.

Obitko’s deposition at p. 40.

We believe that under the Loeb standard, these allegations, if substantiated by proof at trial, establish a prima facie case of age discrimination. The plaintiff has shown sufficient evidence which indicates that age could have been a factor in the defendant’s decision to terminate the plaintiff.

Although the plaintiff did not specifically cite to Obitko’s deposition, we note that in In re Japanese Electronic Products, 723 F.2d 238 (3d Cir.1983), the Court recognized that either party can rely in a Rule 56 proceeding on the contents of the entire record. In re Japanese Electronic Products, at 259. And, since the plaintiff has not submitted any affidavits or cited to any other deposition, we assume that he is relying on the statements made in his deposition. Accordingly, if “there is any evidence in the record from any source from which a reasonable inference in the respondent’s favor may be drawn, the moving party simply cannot obtain a summary judgment, no matter how many affidavits are filed. E.g., Coastal States Gas Corp. v. Department of Energy, 644 F.2d 969, 979 (3rd Cir.1981). The ‘burden’ then is insurmountable.” In re Japanese Electronic Products, at 258.

For all the reasons set forth above, OBL’s motion for summary judgment will be denied.

      . Defendant cites Loeb v. Textron, Inc., supra, wherein the First Circuit noted that while replacement by someone older would suggest no age discrimination it would also not disprove it conclusively. Indeed, by way of example, the court suggested that an older replacement could be hired to ward off a threatened discrimination suit. Loeb at 1014 n. 9. In the case sub judice, defendant alleges that the plaintiff has made no such allegation here.


author: REGAN, District Judge.

text:
    John SHEAHAN, Plaintiff, v. FRED S. JAMES & COMPANY OF MISSOURI, INC., a Missouri corporation, and Asbestos Workers St. Louis Welfare Fund, Defendants.
    No. 85-2056C(B).
    United States District Court, E.D. Missouri, E.D.
    Jan. 14, 1986.

      Mark Bronson, Newman & Bronson, St. Louis, Mo., for plaintiff.
    Donald Bird, Husch, Eppenberger, Donohue & Cornfeld, St. Louis, Mo., for defendants.
   ORDER

REGAN, District Judge.

This matter is before the Court on motion of defendants for summary judgment.

We have jurisdiction of this action under ERISA. By his first amended complaint, plaintiff seeks to recover health benefits allegedly due him by Asbestos Workers St. Louis Welfare Fund under its Plan document. He also seeks $100,000 in punitive damages against Fred S. James & Co. to which certain fiduciary duties have been delegated by the Fund, based on its refusal to authorize payment to plaintiff.

The Fund was established by the Master Insulators Association of St. Louis and the union of which plaintiff is a member to provide health benefits for the union employees. It is administered by a Board of Trustees, two selected by the employers and two by the union. Fred S. James & Co. performs certain administrative responsibilities on behalf of the Trustees, subject to their directions and to the terms of the Plan. Plaintiff has been employed in the insulation industry since 1954, working with asbestos products. He has a eon-firmed primary diagnosis of asbestosis.

The claims in question are for medical care, treatment, hospitalization, and surgical procedures which plaintiff alleges were necessary to determine if there was a lung or other cancer condition (which may have been caused by his asbestosis). The claims were denied by defendant Fred S. James & Co. in conformity to the policy of the Trustees to deny all claims which appear to be related to the claimant’s employment, including those related to a diagnosis of asbestosis, an occupational disease. Plaintiff was notified that the submission of his claims to workers’ compensation was a prerequisite to processing them by the Fund. However, plaintiff has adamantly refused to file a worker’s compensation claim.

The Plan provides (Article IV, Section G) that benefits shall not be payable for or in connection with sickness covered by workers’ compensation law, occupational disease law, or laws of a similar character, or employment for which the covered individual is eligible for benefits under such laws. In addition, said Article IV, Section G specifically provides:

Under no circumstances is the Plan intended to provide benefits in addition to those provided by any state workers’ compensation law. The Administrator may require any Covered Individual to file a claim with the appropriate workers’ compensation carrier if the Administrator believes in good faith that the benefits claimed are or may be covered by applicable workers’ compensation law. In any such case, the claim will not be processed further by the Plan until the claimant has pursued his remedies under workers’ compensation.

After Fred S. James & Co. refused to process the claims involved in this case until plaintiff filed a claim therefor under the applicable workers’ compensation law, and plaintiff appealed that ruling to the Trustees, they agreed to and did review all of plaintiff’s medical and hospital records. The records were confirmatory of the diagnosis of asbestosis, and the Trustees sustained the action of Fred S. James & Co. and so notified plaintiff and his attorney.

The issue here presented is not whether plaintiffs claims are in fact payable by the Fund, but whether defendants believe in good faith that the claims are related to or in connection with asbestosis and as such may be covered under workers’ compensation (including occupational disease) and on that basis require plaintiff to file a workers’ compensation claim as a condition to further processing his claims under the Plan.

In our judgment, there is no controverted issue of fact which would preclude summary judgment. We are aware that plaintiff has filed a nine page “affidavit” of Harry J. Nichols, an attorney who represented him, but is not an attorney of record in the present suit. Virtually all of this document (which purports to be made on information and belief rather than on personal knowledge, and fails to show affirmatively that the affiant is competent to testify to all the matters stated therein, in violation of Rule 56(e) FRCP) is an argument with citations, attempting to persuade the Court that if a workers’ compensation claim were filed it would be unsuccessful. The controversy between Mr. Nichols and the Trustees has continued since at least September, 1983 and would long since have been resolved had plaintiff followed the request of defendants.

It is clear to us that there is no genuine issue as to the good faith belief of defendants that plaintiff’s claims may be covered under the workers’ compensation law. There is no evidence (and the Nichols’ “affidavit” submits none) controverting defendants’ good faith. The mere fact that Nichols may believe that defendants’ decisions were “arbitrary” because they disagreed with him does not suffice to create a genuine issue of fact as to defendants’ good faith belief.

It follows that defendants’ motion for summary judgment should be and it is HEREBY SUSTAINED. •


author: MATSCH, District Judge.

text:
    UNITED STATES of America, Plaintiff, v. Joseph V. PIGNATIELLO, Juan Carlos Schidlowski, and Arlan I. Preblud, Defendants.
    Crim. No. 85-CR-106.
    United States District Court, D. Colorado.
    Jan. 23, 1986.

      Robert Hackman, William Pharo, Asst. U.S. Attys., Office of the U.S. Atty., Denver, Colo., for plaintiff.
    Lee D. Foreman, Haddon, Morgan & Foreman, P.C., Denver, Colo., for defendant Pignatiello.
    Kevin Michael Shea, Holme, Roberts & Owen, Colorado Springs, Colo., for defendant Schidlowski.
    Edward W. Nottingham, Sherman & Howard, Denver, Colo., for defendant Preblud.
   MEMORANDUM OPINION AND ORDER

MATSCH, District Judge.

The indictment, filed May 21, 1985, charges these defendants with several federal law violations arising out of the operations of OTC Net, Inc., a Colorado corporation which engaged in the business of acting as broker and dealer in securities. The first count charges all of the defendants and two unindicted co-conspirators with an extensive conspiracy operating from 1980 to the time of indictment, in violation of 18 U.S.C. § 371. A number of defense motions were heard and considered by this court, resulting in an order on motions entered August 20, 1985, requiring extensive disclosure by the government concerning the conduct of the investigation leading to this indictment.

The same defendants were previously before this court on substantially the same charges alleged in an indictment filed on October 19, 1983 (No. 83-CR-334), and dismissed by this court’s Memorandum Opinion and Order of Dismissal of March 28, 1984. United States v. Pignatiello, 582 F.Supp. 251 (D.Colo.1984). The basis for the dismissal was a violation of F.R.Crim.P. 6(d), resulting from the presence of an SEC attorney in the grand jury room when the first witness in the investigation was questioned on August 24, 1982. Other defense motions were before the court at the time of that order of dismissal, but the order made them moot. The second indictment has regenerated those motions and has raised some new issues.

The defendants have moved to suppress much of the evidence upon which the government relies in this prosecution because of an adjudicated violation of Colorado law governing grand jury proceedings in the state court. The basic facts underlying this contention are not in dispute. The first federal grand jury investigation relating to this matter began in August, 1982. The District Attorney for the Second Judicial District of the State of Colorado had previously been presenting evidence to a grand jury in the District Court, City and County of Denver, Colorado.

C.R.S. § 16-5-204(4)(f) requires the reporting by an authorized reporter of all grand jury proceedings and testimony, and prohibits the release of transcripts without prior court approval. Rule 6.2 of the Colorado Rules of Criminal Procedure directs that all grand jury investigations and functions shall be secret. Colorado Criminal Rule 6.9 governs the procedure for obtaining court approval for releases of grand jury material.

The Denver District Attorney authorized the release of transcripts of the testimony of state grand jury witnesses and documents obtained through state grand jury subpoenas to the federal prosecutors working on the federal investigation, as well as two agents from the Internal Revenue Service, beginning as early as September, 1982. Those releases were without prior court approval. The state court indictment was not returned until May 24, 1983. In the state criminal proceeding, the state judge ordered suppression of any and all materials released in violation of state grand jury secrecy requirements, and any evidence derived therefrom. That order was entered March 23,1984 as a result of a hearing held on March 9,1984, with a stipulation of facts entered into by the district attorney and counsel for the defendants. A second state court order was entered June 22, 1984, nunc pro tunc May 30, 1984. That June order was based on detailed findings concerning the releases made without prior court approval. Those findings referred specifically to releases made to Assistant United States Attorney William Pharo in October, 1983. Because this matter had been raised by defense motions in the earlier federal prosecution, government counsel submitted evidence to a different federal grand jury, and attempted to avoid direct use of the transcripts of testimony and documents which had been made subject to the state court suppression orders.

The government seeks to minimize the violation of state grand jury secrecy requirements. First, it is contended that the material released to Mr. Pharo in October, 1983 was pursuant to a court order which the state court ruled invalid because of procedural irregularity. Second, the government contends that most of the material was already known to the federal attorneys and investigators, and that which was not then known would' inevitably have been discovered. Finally, it is asserted that the transcripts and documents were not submitted to the second federal grand jury.

The defendants sought to counter these assertions at an evidentiary hearing held in this court on November 26, 1985. From that hearing, this court concludes that if there is a legal basis for suppression of the use of the material obtained in violation of state law in this federal prosecution, the government would have an extraordinarily difficult burden of showing attenuation, inevitable discovery, or any other avoidance of the impact of the rule prohibiting derivative use of tainted evidence. Accordingly, the legal question is presented squarely— does the United States Constitution or any federal law require suppression of evidence obtained in this violation of state law?

The defendants urge that this court give full faith and credit to the state court orders and apply them to this prosecution pursuant to 28 U.S.C. § 1738. That is too simplistic. The state court suppression orders are based on the same prophylactic rule which both state and federal courts have used to exclude evidence obtained from unreasonable searches and seizures. There has been no final adjudication of a controversy which comes within the scope of the full faith and credit clause. Thus, this court has accepted the findings made by the state court in support of that suppression order, but the remedy is a matter of federal law. No federal constitutional or federal statutory rights were violated by the disclosure of the state grand jury materials. In Elkins v. United States, 364 U.S. 206, 80 S.Ct. 1437, 4 L.Ed.2d 1669 (1959), the Supreme Court held that a state court ruling suppressing evidence does not bar the use of such evidence in a federal proceeding, and used the following language:

In determining whether there has been an unreasonable search and seizure by state officers, a federal court must make an independent inquiry, whether or not there has been such an inquiry by a state court, and irrespective of how any such inquiry may have turned out. The test is one of federal law, neither enlarged by what one state court may have countenanced, nor diminished by what another may have colorably suppressed.

Id. at 223-24, 80 S.Ct. at 1447.

The purpose of the Colorado court’s exclusionary order was the protection of the integrity of the state grand jury proceedings. The defendants contend that this purpose would be frustrated by admitting the evidence in this court. There is no merit to that argument. The information was lawfully obtained by state law enforcement officials using appropriate procedures in connection with the state grand jury. If appropriate state court orders had been first obtained, nothing would have precluded the use of that evidence in the federal investigation and prosecution. The error was with the staff of the state district attorney, and did not involve misconduct by the federal lawyers and investigators. The state prosecutor has already been sanctioned by the suppression order which resulted in ultimate dismissal of his case. There is no basis for any belief that future unauthorized releases by Colorado state officials would be deterred by the exclusion of this evidence in the federal prosecution.

The Supreme Court has consistently recognized that the exclusionary sanction must be applied selectively to avoid impeding unacceptably the truth-finding functions of judge and jury by the suppression of probative but tainted evidence. United States v. Payner, 447 U.S. 727, 734, 100 S.Ct. 2439, 2445, 65 L.Ed.2d 468 (1980). In this court’s view, the defendants’ motion to suppress the first indictment in this case would have been denied, and it follows that the motion must be denied as to the second indictment.

The defendants have moved to dismiss this indictment for prosecutorial misconduct. The unauthorized use of the state grand jury materials is one of the grounds for this motion. An additional ground is the allegation that the prosecutors elicited testimony before the grand jury in violation of the marital privilege because Mr. Pignatiello’s former wife, Richalie Cranmer, testified before the state grand jury and, also, the first federal grand jury which returned the indictment in case 83-CR-334. Ms. Cranmer was not called before the grand jury which returned the subject indictment. Under Rule 501 of the Federal Rules of Evidence, the privilege of any witness is governed by federal law, and under Trammel v. United States, 445 U.S. 40, 100 S.Ct. 906, 63 L.Ed.2d 186 (1980), the witness-spouse, alone, holds the privilege to refuse to testify. Without now ruling on the admissibility of any testimony of the former spouse at trial in this case, particularly with respect to confidential communications, there is no basis for a finding that any fundamental rights of any of the defendants in this indictment were violated by the calling of this witness before the prior grand juries.

The defendants also contend that AUSA Pharo violated an order entered by Chief Judge Finesilver requiring that Mr. Pharo discontinue appearing before the grand jury in this investigation because of Mr. Pharo’s action in misrepresenting his identity in a telephone communication during the course of this investigation. This court conducted an evidentiary hearing on this matter, and it is clear that Mr. Pharo appeared before the same grand jury in connection with matters concerning customers and brokers of OTC Net, Inc. which related to, but did not involve directly, the allegations made against these defendants. Mr. Pharo’s conduct could well be considered to be in violation of Chief Judge Finesilver’s order, but this court makes no finding in that regard because the appropriate remedy for such a violation would be a contempt, proceeding before Judge Fine-silver rather than a dismissal of the indictment.

The Tenth Circuit Court of Appeals has made it very clear in United States v. Pino, 708 F.2d 523 (10th Cir.1983), that the drastic remedy of court dismissal of an indictment for prosecutorial misconduct must be limited to a showing of some significant infringement on the grand jury’s ability to exercise independent judgment. Nothing before this court indicates that the independent judgment of the grand jury returning the subject indictment was influenced or affected by any inappropriate conduct of the federal prosecutors now before this court. The Pino case was very recently strongly reaffirmed in United States v. Anderson, 778 F.2d 602, 604-605 (10th Cir.1985).

The defendants Pignatiello and Schidlowski have moved to dismiss Count VI and Count VII, respectively, for prosecutorial vindictiveness. The assertion is that these charges were added because of the aggressive challenge to the prosecutors’ conduct in the second grand jury investigation. There is no evidence of vindictiveness. The new grand jury indictment has changes in the counts, including the addition of new counts. The possible fine which could be levied against each defendant has been increased, but the exposure to possible prison sentences remain the same. Because evidence was presented to a new grand jury, and because the second indictment is not grossly disproportionate to the dismissed indictment, there has been no threshold showing of vindictiveness.

The defendants have moved to dismiss the indictment on the contention that the government is using a civil action, SEC v. OTC Net, Inc., No. 82-Z-877, as an improper means to discover evidence for this criminal prosecution. That civil action is pending before Judge Weinshienk of this court, and the discovery cutoff date has been set for July 3, 1986. The defendants’ concern about the possible use of civil discovery for criminal purposes has been expressed only in general terms. The grand jury provides significantly greater discovery opportunities than is available under the rules of civil procedure, and if there is any inappropriate use of civil discovery for purposes of this prosecution, the appropriate action is to move for a stay of discovery or for protective orders from the judge presiding over the civil action.

Finally, the defendants have moved for severance under F.R.Crim.P. 14. The general rule in this circuit is that individuals charged with a conspiracy should be tried together, especially where the proof is based on the same evidence and acts. United States v. Hines, 696 F.2d 722, 732 (10th Cir.1982). The defendants contend that the defendant Arlan Preblud served as legal counsel for Schidlowski and Pignatiello, and that a joint trial would result in a conflict between Preblud’s right to give exculpatory evidence and the other defendants’ attorney-client privilege.

The attorney-client privilege does not extend to disclosures made in furtherance of a crime. The question of whether the communications are privileged can be determined at trial. The question of admissibility is not affected by the number of trials.

The defendants also contend that only one defendant may choose to testify, and that his lawyer may be forced to comment on the other defendants’ silence. As the government notes, this is not a reason for severance where the defenses are not antagonistic. United States v. Herring, 582 F.2d 535, 542 (10th Cir.1978). In addition, the fact that a defendant cannot secure the testimony of his co-defendants at trial is insufficient to require severance. The defendants must first show that when called at a separate trial, the co-defendant would give exculpatory testimony.

The defendants have failed to show sufficient prejudice or other grounds for severance.

Upon the foregoing, it is

ORDERED that the defendants’ motions to suppress; to dismiss and to sever, as discussed above, are denied, and it is

FURTHER ORDERED that all counsel and the defendants will be present for a pre-trial conference in Courtroom A, Second Floor, Post Office Building, 18th and Stout Streets (use 19th Street Entrance), Denver, Colorado on Friday, February 14, 1986 at 1:30 p.m.


text:
    BREWERY AND BEVERAGE DRIVERS LOCAL 67, Plaintiff, v. CANADA DRY POTOMAC CORPORATION, Defendant.
    Civ. A. No. 85-2932.
    United States District Court, District of Columbia.
    Jan. 23, 1986.

      John R. Mooney, Washington, D.C., for plaintiff.
    Richard H. Nicolaides, Washington, D.C., for defendant.
   MEMORANDUM

JOHN GARRETT PENN, District Judge.

The plaintiff seeks to have the Court modify or vacate in part an arbitration award signed on June 18, 1985. Complaint Exhibit E. The arbitration award was entered pursuant to the terms of the collective bargaining agreement (CBA) entered into by the parties for the period February 27, 1983 to February 27, 1986. Complaint Exhibit A. On September 16, 1985, the plaintiff filed the complaint in this case pursuant to 29 U.S.C. § 185 and the matter is now before the Court on cross-motions for summary judgment.

I

Very briefly, the underlying facts are as follows: The defendant bottles and distributes Canada Dry brand products, Hires Root Beer, Rock Creek brand products and Perrier water to accounts in the Washington, D.C. metropolitan area. In 1974, the defendant introduced a 64 ounce glass bottle into its product line. These 64 ounce bottles were always packaged six to a case. In 1979, the defendant replaced the 64 ounce glass bottles with two-litre plastic bottles and continued to package them six to a case. In August 1984 the defendant began to package eight two-litre bottles to a case. Article XI of the CBA provides that “During the life of this Agreement, there shall be no reduction in rates of pay or other benefits that were in effect prior to the signing of this contract for any employee.” Complaint Exhibit A at 22. Pursuant to Article IV of the CBA, the plaintiff filed a grievance on September 19, 1984 objecting to defendant’s action in unilaterally changing the package size of its two-litre bottle case from a six bottle case to an eight bottle case while continuing to pay its employees the same commission rate per case. Complaint Exhibits A at 14-15 and B. After the parties’ efforts to resolve the dispute were unsuccessful, the matter was submitted to arbitration under the terms of the CBA.

The arbitrator found that the grievance was arbitrable as provided in CBA, Article IV, and that the “change in the case size resulted in a reduction in the rate of commission paid for the sale and delivery of two-litre size product.” He further found that “Article XI provides in specific terms that there shall be no reduction in rates of pay and such a reduction has, in fact, occurred.” Complaint Exhibit E at 6 (emphasis the Court’s). But, notwithstanding this finding, the arbitrator concluded that he did not have the authority to add a specific method to the CBA for increasing commission rates in the event of an increase in the size of a case. Id. As a result, he declined to direct the increase of commissions to be paid on the eight bottle case but, instead, directed the parties to establish the rate through collective bargaining.

Plaintiff contends that, while the arbitrator found that the defendant breached the CBA, he failed to fashion a remedy for the breach. Plaintiff requests that the arbitrator, or another arbitrator, devise an appropriate remedy for the defendant’s breach.

The defendant contends that the Court lacks jurisdiction to entertain this action under 29 U.S.C. § 185(a), that the arbitrator’s decision is final and conclusive, and that the “final and binding” provision in the CBA bars reconsideration of the dispute.

The defendant requested an oral hearing on the motions, but that request is denied in view of the time limitations involved in this case; the present CBA is to expire on February 27, 1986. Moreover, the Court concludes that oral arguments would not be helpful since the issue is relatively simple and limited and the parties have had a full opportunity to file written briefs. See Local Rule l-9(g).

II

The Court has jurisdiction over this action pursuant to 29 U.S.C. § 185. The plaintiff is not seeking to have the Court review the merits of the dispute. Nor does the plaintiff seek to have the Court reconsider the issue of whether the dispute is arbitrable. Rather, the plaintiff accepts the decision by the arbitrator and asks only that, having decided the case on the merits in favor of the plaintiff, the arbitrator fashion a remedial order to bring the defendant into conformity with the terms of the CBA.

It is clear that Section 185 may be the basis for a complaint that the arbitrator exceeded his authority. See Local 369, Bakery and Confectionary Workers International Union of America, AFL-CIO v. Cotton Baking Co., Inc., 514 F.2d 1235 (5th Cir.1975), rehearing denied 520 F.2d 943, cert. denied 423 U.S. 1055, 96 S.Ct. 786, 46 L.Ed.2d 644 (1976); Proctor & Gamble Manufacturing Co. v. Independent Oil and Chemical Workers, 386 F.Supp. 213, 215 (D.Md.1974). It is equally clear that an arbitrator, acting under the authority granted to him by virtue of the CBA and the issue presented for arbitration, having determined that a party has breached the CBA, must then fashion an appropriate remedy absent a provision in the CBA which would prevent such relief. See Local 369, supra at 1237.

When an arbitrator is commissioned to interpret and apply the collective bargaining agreement, he is to bring his informed judgment to bear in order to reach a fair solution of a problem. This is especially true when it comes to formulating remedies. There is a need for flexibility in meeting a wide variety of situations.

United Steel Workers of America v. Enterprise Wheel and Car Corp., 363 U.S. 593, 597, 80 S.Ct. 1358, 1361, 4 L.Ed.2d 1424 (1960) (emphasis this Court’s). The fact that a remedy is not specifically set forth in the CBA should not deter the arbitrator from effecting remedial relief.

Furthermore, the arbitrator must also be left free to decide more than which party is right or which party is wrong. Having found a contract violation, he must fashion a remedial order to bring the parties’ actions in conformity with the contract and make reparation for past infringements. A collective bargaining agreement may not specify the relief required for every conceivable contractual violation, so the arbitrator must often rely on his own experience and expertise in formulating an appropriate remedy. In view of the variety and novelty of many labor-management disputes, reviewing courts must not unduly restrain an arbitrator’s flexibility.

Local 369, supra at 1237 (citations omitted) (emphasis this Court’s).

Here, the arbitrator has found that the defendant breached the CBA when it increased the number of two-litre bottles in a case from six to eight without increasing the amount of commission to be paid per case. Having made that determination, it is now the duty of the arbitrator to fashion an appropriate remedy; a matter which may possibly be performed by simple calculation together with any adjustments the arbitrator feels may be warranted. “Unlike a judge or jury, an arbitrator may reach a compromise verdict on damages and set the award accordingly, especially if the contract can reasonably be so interpreted.” 48 A Am.Jur.2d, Labor and Labor Relations, Section 1988 (2d ed. 1979).

The defendant’s argument that the arbitrator’s decision is final and conclusive misses the point; the fact is that the arbitrator, after having made his determination did not direct a remedy. Moreover, the defendant’s argument that the “final and binding” provision in the CBA bars reconsideration of the dispute in this case also misses the mark since'the plaintiff does not seek reconsideration of the dispute; the plaintiff has already prevailed on the issue presented to the arbitrator; rather, the plaintiff seeks relief.

In view of the above this Court concludes that plaintiff’s motion for summary judgment should be granted and that defendant’s motion for summary judgment should be denied. This matter is to be remanded to the arbitrator so that he may direct appropriate relief pursuant to the finding he has made in this case.

An appropriate order has been issued.

      . The plaintiff argued that if a driver delivered 400 cases of identical two litre bottles in August 1984 and May 1985, he would lose approximately $34.58. Complaint Exhibit C (plaintiffs brief before the arbitrator) at 5.


author: SENTER, Chief Judge.

text:
    UNITED STATES of America, Plaintiff, v. M.L. McREYNOLDS, Defendant.
    No. EC 84-264-LS-D.
    United States District Court, N.D. Mississippi, E.D.
    Jan. 24, 1986.
    Robert Q, Whitwell, U.S. Atty., Patricia D. Rogers, Asst. U.S. Atty., Oxford, Miss., for plaintiff.
    H. J. Davidson, Jr., Carter & Davidson, Columbus, Miss., for defendant.
   MEMORANDUM OPINION GRANTING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT

SENTER, Chief Judge.

I. Introduction.

The United States commenced this action on July 21, 1984, for and on behalf of the Small Business Administration (SBA) against defendant to collect an amount due on a loan, now in default, which had been assigned to the SBA by the original lender. For the reasons stated hereinbelow, the court is of the opinion that there are no genuine issues of material fact, that plaintiff is entitled to judgment as a matter of law, and that defendant’s motion for summary judgment should be denied.

II. The Facts.

On March 27, 1981, defendant signed, executed, and delivered a promissory note for the original principal amount of $300,-000. 00.payable to the order of the National Bank of Commerce of Mississippi, a Mississippi banking corporation domiciled and having its principal place of business in Starkville, Mississippi. This was an installment note to be paid over a period of fifteen years, with interest to accrue at the rate of 12% per annum for the first three months and then subject to quarterly adjustments, upward or downward, as of January 1, April 1, July 1, and October 1 each year, to a rate of 2Va% over the New York prime rate as reported by The American Banker, but not in excess of the maximum allowed by law. The monthly installments of $4,103.00 were to be applied first to interest accrued to date of receipt of the installment, and the balance, if any, to principal. The note also contained a provision which stated that if the borrower defaulted in payment due on the indebtedness and the SBA subsequently purchased the indebtedness, the rate of interest on both the guaranteed and unguaranteed portions would become fixed at the rate in effect as of the date of the default. In conjunction with the execution of the note and as security therefor, McReynolds and Daniel, d/b/a Sureway Supermarket, executed and delivered a deed of trust on the Sureway property to a trustee for the use and benefit of the National Bank of Commerce.

Shortly after execution of the note and deed of trust, default occurred, and on November 12, 1981, the note and deed of trust were assigned to the SBA. A substituted trustee was appointed four months later, and foreclosure proceedings were begun. On May 25, 1982, the substituted trustee conveyed by warranty deed the property after proper foreclosure proceedings had been completed. The United States initiated this suit to collect the deficiency on July 21, 1984, over two years after the foreclosure proceedings had been completed. Each party has moved for summary judgment in its favor, each claiming that there is no genuine issue of material fact and that it is entitled to judgment as a matter of law.

III. The Contentions of the Parties.

In support of its motion, plaintiff alleges that the action was timely brought pursuant to the six-year statute of limitations codified at 28 U.S.C. § 2415(a) (Supp.1985), which provides the time limit for commencing actions by the United States in actions for money damages founded upon any contract. Plaintiff further alleges that there remains due and owing the principal amount of $221,520.38, plus interest accrued through May 31, 1985, in the amount of $114,814.76, and, thereafter, interest at the contractual rate of 22V2% per annum, or $136.55 per day.

In his response to plaintiff’s motion and in his cross-motion for summary judgment, defendant asserts that the statute of limitations provided by Miss.Code Ann. § 15-1-23 (1972), and not by 28 U.S.C. § 2415(a) (Supp.1985), is applicable to this action. That state statute requires that any action on an installment note secured by a deed of trust be commenced within one year from the date of the foreclosure or sale of the property pledged as security for the note. Defendant argues that since foreclosure proceedings were brought and concluded on May 25, 1982, and suit was not brought by the United States until July 23, 1984, two years after the foreclosure proceedings had been completed, then this suit is barred by Mississippi’s one-year statute of limitations. In the alternative, defendant contends that the rate of interest fixed as of the date of default (22V2%), pursuant to the terms of the note, is in excess of the maximum rate allowed by law and is, therefore, usurious. Accordingly, he argues, the entire amount of principal and interest should be forfeited or, at least, all payments made toward interest since 1981 should be applied exclusively to the principal, and the interest should be forfeited.

IV. Discussion.

A. Statute of Limitations.

Defendant argues, in effect, that state law preempts federal law. He contends that Mississippi’s one-year statute of limitations applies instead of the six-year limitations period provided in 28 U.S.C. § 2415(a) (Supp.1985). This argument is meritless and must fail.

The pertinent provision of 28 U.S.C. § 2415(a) (Supp.1985), entitled “Time for Commencing Actions Brought by the United States,” provides that “every action for money damages brought by the United States ... which is founded upon any contract express or implied in law or fact, shall be barred unless the complaint is filed within six years after the right of action accrues____” 28 U.S.C. § 2415(a) (Supp.1985).

The Small Business Act, 15 U.S.C. § 631, et. seq., which created the Small Business Administration, imposes no statute of limitations upon that organization. The legislative history of 28 U.S.C. § 2415(a) declares the purpose of the Act to be the establishment of limitations on contract actions brought by the United States. See 1966 U.S.Code Cong. & Admin.News, pp. 2502-14. Accordingly, the action sub judice is controlled by the federal six-year limitations period. This result is consistent with the long settled rule that the United States is not subject to local statutes of limitations in enforcing its rights unless it has consented to the application of those statutes. See United States v. John Hancock Mut. Ins. Co., 364 U.S. 301, 308, 81 S.Ct. 1, 5, 5 L.Ed.2d 1 (1960); United States v. Summerlin, 310 U.S. 414, 416, 60 S.Ct. 1019, 1020, 84 L.Ed. 1283 (1940); United States v. Kellum, 523 F.2d 1284, 1286 (5th Cir.1975) (action brought to collect unpaid balance of loan from SBA); United States v. Kurtz, 525 F.Supp. 734, 740-41 (E.D.Pa.1981), aff'd without opinion, 688 F.2d 827 (3rd Cir. 1982) (same). Congressional intent to waive governmental immunity from state statutes of limitation must be clearly manifested. Kellum, 523 F.2d at 1286. There is no such waiver in the action sub judice. Accordingly, the federal six-year limitations period, and not Mississippi’s one-year proscriptive period, applies in this action, and plaintiff is not time-barred.

B. Rate of Interest.

Defendant asserts that the maximum rate of interest that could have been charged on this loan was 19% per annum, the sum of 14%, the Federal Reserve discount rate in effect on June 27, 1981, the date of default, and 5%, the contractual rate of interest permitted to be charged in excess of the discount rate. He asserts that the rate charged by defendant and its assignor bank, 22%% per annum, is 3%% in excess of the maximum rate allowed by law and is, therefore, usurious. Accordingly, he argues, the entire amount of principal and interest should be forfeited, or at least all payments made towards interest since 1981 should be applied solely toward the principal and the interest should be forfeited.

Plaintiff argues that the maximum rate of interest allowed by law at the time in issue was 23% per annum, calculated by adding the 14% discount rate, the 5% permitted in excess of the discount rate, plus a surcharge of 4%. Since the rate charged was 22V2% per annum, a half-point below the maximum permitted by law, plaintiff contends that the rate was not usurious. The court finds that plaintiffs argument is supported by the law and that defendant’s contentions are meritless.

The dispute of the amount of the maximum allowable rate centers around whether a surcharge on the loan is permissible. If it is, then the maximum rate of interest permitted by law would be 23% per annum (14% plus 5% plus 4%). If it is not permissible, then the maximum rate of interest is 19% per annum (14% plus 5%), and the rate charged by the lender (22%%) is in excess of the legally allowable rate.

Section 86a of Title 12 of the United States Code, entitled “Interest on business and agricultural loans of $1,000 or more,” permits a lender on such a loan to “take, receive, reserve, and charge on any such loan, interest at a rate of not more than 5 per centum in excess of the discount rate, including any surcharge thereon____” 12 U.S.C. § 86a (Supp.1985) (emphasis added). In support of its argument, plaintiff attached the affidavit of Joel Crews Clements, Executive Vice President of the National Bank of Commerce of Mississippi, who is responsible for credit administration. The affiant stated that a 4% surcharge is permitted on loans of this kind, and that the maximum legal rate that could have been charged was 23%, the sum of the 14% discount rate, the 4% surcharge, and the 5% permitted over the discount rate. Incorporated into his affidavit was a copy of the bank’s loan rates in effect at the time in question. Defendant submitted the affidavit of Joan P. Cronin, Vice President and Deputy General Counsel of the Federal Reserve Bank of St. Louis, in support of his motion. However, the interest rate schedule attached thereto as an exhibit shows that the discount rate was 14% per annum and that a surcharge of four percentage points was applicable. Furthermore, a memorandum from the president of the Federal Reserve Bank of St. Louis to its district financial institutions expressly states that a surcharge of four percentage points will apply to certain borrowings. Defendant’s Ex. E to Response. It is undisputed that the borrowing in issue falls into this category. Accordingly, even defendant’s affidavit and supporting memoranda support plaintiff’s position that the maximum allowable rate of interest was 23% per annum at the time in issue. Consequently, subsection (c) of section 86a, which provides the penalties for charging a rate in excess of § 86a(a), is not applicable since the rate did not exceed the legally allowable rate.

A grant of summary judgment is appropriate only where it appears from the record, considered in the light most favorable to the party opposing the motion, that there is no genuine issue of material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Galindo v. Precision American Corp., 754 F.2d 1212, 1216 (5th Cir.1985). Rule 56(c) permits summary judgment only when the underlying facts are undisputed and the record reveals no evidence from which reasonable persons might draw conflicting inferences about those facts. Richoux v. Armstrong Cork Corp., 777 F.2d 296, 297 (5th Cir.1985); Prinzi v. Keydril Co., 738 F.2d 707, 709 (5th Cir.1984).

The underlying facts in the action sub judice are not in dispute. The only disputes herein involve the appropriate statute of limitations and interest rate, both issues of law which may be resolved by the court. Although the court is, well aware that summary judgment must be granted with care, we are also aware that “in cases where there is no genuine issue of fact it is appropriate, indeed demanded, by the Federal Rules of Civil Procedure and the efficient administration of justice.” Rayborn v. Miss. State Bd. of Dental Examiners, 776 F.2d 530, 531 (5th Cir.1985).

The court is of the opinion that the federal six-year statute of limitations is applicable to the action sub judice. ' Since plaintiff brought this action well within that six-year period, this suit is not time-barred. Furthermore, the maximum rate of interest allowable by law at the time in issue was 23% per annum, the sum of the 14% discount rate, the 4% surcharge, and the 5% rate contractually allowed over the discount rate. Since the rate charged defendant was 22x/2% per annum, defendant was not charged a rate in excess of that allowed by law. The court is, therefore, of the opinion that plaintiffs motion for summary judgment should be granted and that defendant’s motion for summary judgment should be denied. Judgment is to be entered against defendant in the amount of $221,520.38 in principal, plus interest accrued through November 26, 1985, in the amount of $139,257.21, and thereafter at the contractual rate of 22x/2% per annum or $136.55 per day.

An order in conformance with this opinion shall this day issue.

      . Both Defendant McReynolds and John H. Daniel signed the note, becoming jointly and severally liable for the debt. This action was brought only against McReynolds.

      . The amounts due were submitted by John E. Lagos, Director of the Office of Accounting Operations, Office of the Comptroller, SBA. In that capacity, Lagos has direct supervision and custody of the official financial records of the SBA. Plaintiff attached to its motion a certificate of indebtedness signed by Lagos and certifying the amount of indebtedness on the loan in issue.

      . Of course, § 2415(a) does not apply to a cause of action until the federal government has been assigned the right to sue. That occurred on November 12, 1981, here. Where the government acquires a derivative claim, as by assignment, and that claim is not then time barred by the state statute of limitations, the state statute ceases to run against the government at the time of such acquisition. United States v. Sellers, 487 F.2d 1268, 1269 (5th Cir.1974) (citations omitted). Here, the government acquired the claim well within the state statute of limitations: default occurred on June 27, 1981, and the SBA was assigned the note on November 12, 1981.
      Section 2415(a) requires the six-year statute of limitations to begin running at the time the right of action “accrues.” Since the note was executed on March 27, 1981, and default occurred shortly thereafter, both well within the six-year limitations period, the court need not address, and the parties did not raise, the issue of precisely when the right of action accrued. See United States v. Cardinal, 452 F.Supp, 542, 544-48 (D.Vt.1978) (determining when cause of action accrued under § 2415(a) in action by FHA to recover-on promissory note which had been defaulted upon).

      . The surcharge is the charge made by the Federal Reserve Bank to institutions borrowing therefrom. Affidavit of Joel Crews Clements, Executive Vice President of NBC of Mississippi.


author: LEVAL, District Judge.

text:
    Luis DE VILLAR; Marco Rodriguez; Carmen Pietri, Joseph Pietri and Pedro Pietri as representatives of the Estate of William Pietri, decedent; Carmen Valette; Constance Hotaling; Angela Hariri as representative of the Estate of Betty Bonilla, decedent; Eric Hotaling; Sylvia Vega; Hector Lopez; and Steven Jones, Plaintiffs, v. The CITY OF NEW YORK; Anthony Gliedman, individually and in his capacity as Commissioner, Department of Housing Preservation and Development of the City of New York; and Milton Silverman, individually and in his capacity as a Real Property Manager of the Office of Property Management of the Department of Housing, Preservation and Development of the City of New York, Defendants.
    No. 83 Civ. 1768(PNL).
    United States District Court, S.D. New York.
    Jan. 27, 1986.

      Debevoise & Plimpton by John Kieman, New York City, for plaintiffs.
    Frederick A.O. Schwarz, Jr., Corp. Counsel of the City of New York, New York City by Daniel L. Schneider, Asst. Corp. Counsel, for defendants.
   OPINION AND ORDER

LEVAL, District Judge.

Defendants move for summary'judgment dismissing charges brought by squatters and illegal occupants at 126 La Salle Street, a city-owned building. These plaintiffs allege that their eviction from the building without notice by the New York City Department of Housing Preservation and Development and by the New York City Police violated their constitutional rights. Their action is brought under 42 U.S.C. § 1983. A motion for judgment on the pleadings was previously denied. Summary judgment is now granted.

Background

Defendants are the City of New York; Anthony Gliedman, individually and as Commissioner of HPD; and Milton Silver-man, individually and as the Real Property Manager of the Office of Property Management of the HPD.

Six plaintiffs are implicated in this motion. Carmen Valette, Constance Hotaling, Eric Hotaling, and Sylvia Vega were squatters who entered the building without permission or authority in the Fall of 1981. Luis del Villar and Marco Rodriguez, having been hired as superintendents at 126 La Salle in January 1981, were terminated in August 1981, after which time they continued to live in the building illegally without paying rent.

Title to the building vested in the City of New York in 1977 through in rem tax foreclosure. In May 1981, the building was placed in a Consolidation Program, pursuant to which the building was to be closed down because it was underutilized and too expensive to repair. On June 15, 1981, HPD ordered the immediate relocation of the residents remaining in the nine occupied apartments at 126 La Salle (PI. Affid., Ex. B). Eve Lampert, the Area Director of HPD, ordered on August 31, 1981, that the burner for the heating system and all other salvageable materials be removed from the building.

In October 1981, defendant Milton Silver-man, an assistant to Eve Lampert, went to 126 La Salle to attempt to persuade squatters to leave the building and to direct legal tenants to find other apartments (Def s Affid. 113 & 4). He returned to the building for the same purpose on November 9, 1981 (Complaint, ¶ 28). At both times, Mr. Silverman was accompanied by police officers (Complaint ¶ 27 & 28).

On December 7, 1981, HPD posted a vacate order in 126 La Salle informing the occupants that they must vacate the premises within thirty days (Complaint, ¶ 30). On December 8,1981, twelve HPD officials accompanied by approximately thirty police officers entered the building under the direction of defendant Milton Silverman (Complaint, 1133). The officers ordered all residents to vacate or face arrest for criminal trespass (Complaint It 34). All plaintiffs abandoned their apartments except Constance Hotaling who was arrested and held for an hour (Complaint, 11 35). The occupants were not allowed to gather their belongings that day (Complaint, 1135). The next day they were permitted to remove their personal property from the building.

Plaintiffs filed an Article 78 Proceeding, New York Civil Practice Law and Regulations, in New York State Supreme Court, New York County. On December 28, 1981, the State Supreme Court ordered that certain of the plaintiffs be allowed to reenter their apartments in 126 La Salle (Complaint, Ex, 1). They were permitted to remain in their apartments until they were relocated by the City to other housing in 1983 and 1984. The City consented by stipulation on February 22, 1983 to civil suit in exchange for plaintiffs cancelling the scheduled hearing in the Article 78 proceeding (Complaint, Ex. 3).

On March 8, 1983, plaintiffs filed suit against defendants in New York State Supreme Court and in federal district court, alleging violation of their Fourteenth Amendment rights, pursuant to 42 U.S.C. § 1983, and the state tort claims of unlawful eviction, trespass, assault, false arrest and intentional infliction of emotional distress.

Discussion

Summary judgment is to be granted under Fed.R.Civ.P. 56(c) only if the competent evidence submitted demonstrates that there is no material issue of fact and that the moving party is entitled to judgment as a matter of law. See Adickes v. S.H. Kress & Co., 398 U.S. 144, 157, 90 S.Ct. 1598, 1608, 26 L.Ed.2d 142 (1970). The affidavits and exhibits submitted by the parties “must be viewed in the light most favorable to the party opposing the motion.” United States v. Diebold, 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962); Burtnieks v. City of New York, 716 F.2d 982, 985 (2d Cir.1983). However, when a party has made a showing sufficient to warrant summary judgment, the opposing party is obliged to come forward, with affidavits or other properly qualified evidence to demonstrate that there is a material issue of fact.

In the first two counts of their complaint, plaintiffs allege that their eviction by HPD officials acting under color of state law deprived them of their right to property without due process of law as well as of their substantive due process rights. Defendants concede that they were acting under color of state law. But there is no showing of any violation of constitutional rights. Plaintiffs have failed to submit evidence raising a material issue of fact as to the denial of any federal constitutional right. Moreover, even if plaintiffs had shown evidence of a constitutional violation, they have failed to submit evidence raising a material issue of fact as to the liability in damages of either the City or the individual defendants.

I.

Plaintiffs were trespassers, squatters and illegal occupants of the building. They had no constitutional property interest in the apartments they occupied. There was no legal bar to arresting them for criminal trespass if the City officials had decided to make a criminal complaint. Nor do trespassers/squatters possess a constitutional entitlement to notice and court proceedings before being arrested (or evicted). They have shown no deprivation of “rights, privileges or immunities secured by the Constitution or laws of the United States.” Parratt v. Taylor, 451 U.S. 527, 535, 101 S.Ct. 1908, 1912, 68 L.Ed.2d 420 (1981).

Four of the plaintiffs who entered the building illegally after it was placed in the consolidation program, and without ever paying rent to the City, claim to have acquired a property interest in their apartments. Quite clearly, the plaintiffs had no more of a property interest in those apartments than in any others in the City they might have trespassed into and encamped within, that is, none at all. See 272-4-8 East 7th Street Tenants Assn. v. City of New York, 117 Misc.2d 783, 459 N.Y.S.2d 346 (N.Y.Sup.Ct.1982) (post-Consolidation squatters have no right to enjoin the City from closing the premises). Bare possession is not constitutionally protected. Rosado v. Dudio, No. 83 Civ. 2407, slip op. at 7 (S.D.N.Y. Dec. 20, 1984).

Plaintiffs del Villar and Rodriguez acquired their apartments lawfully in return for their services as superintendents. Their employment was terminated in August 1981, however, four months prior to the evictions. As explained by a New York state court, “where landlord gave possession of apartment to an individual, hired as a superintendent, as an incident of such employment, ... no relationship of landlord-tenant arises.” Dobson Factor v. Dattory, 80 Misc.2d 1054, 364 N.Y.S.2d 723, 724 (N.Y.Civ.Ct.1975). Thus, on the undisputed facts, any interest del Villar and Rodriguez had in the property ceased with the termination of their employment as would any other form of compensation. After their termination, neither made any attempt to pay rent for the two apartments to the City.

Because the plaintiffs had no property interest in the apartments they were living in, their evictions did not implicate the Due Process Clause of the Fourteenth Amendment.

Plaintiffs next argue that New York law entitled them to ten days’ notice and that this entitlement is enforceable as *a constitutionally protected right in an action under § 1983. Their argument fails as a matter of New York law. Even if they were right as a matter of New York procedure, this would not make a constitutionally protected right.

The argument under New York law refers to N.Y. Real Prop. Acts., § 713(3), (McKinney’s 1979). Plaintiffs misread this statute. It does indeed provide a ten day notice period for a landlord to receive a judgment, evicting squatters through summary proceedings. The fact that a court will not issue a judgment of eviction without ten days notice in no way implies that an owner is barred by law from removing a trespasser or illegal occupant. The very argument is prepostrous and plaintiffs cite nothing to support it. Section 713(3) of the Real Property Law would not have prevented arresting plaintiffs for criminal trespass under the N. Y. Penal Law, § 140.-15 (McKinney’s 1975). Nor does it bar threatening to do so.

Plaintiffs further argue that the City has customarily followed the notice procedure under § 713(3) before evicting squatters. Regardless whether this is true, it does not confer a legal right, nor does it create a “mutually explicit understanding ... of entitlement.” Perry v. Sinderman, 408 U.S. 593, 601, 92 S.Ct. 2694, 2699, 33 L.Ed.2d 570 (1972). Even if plaintiffs could point to a procedural requirement under New York State law, this would not give them a constitutionally protected right. See Olim v. Wakinekona, 461 U.S. 238, 103 S.Ct. 1741, 1748, 75 L.Ed.2d 813 (1983); Davis v. Scherer, 468 U.S. 183, 104 S.Ct. 3012, 3020, 82 L.Ed.2d 139 (1984). Although the Constitution has been much trivialized, see Friendly, The Bill of Rights as a Code of Criminal Procedure, 53 Calif.L.Rev., 929 (1965), it has not progressed to the point where every notice provision of state real property law has become a matter of constitutional right, even when a municipality is landlord, having taken possession under a tax foreclosure.

Defendants have established that they are entitled to summary judgment dismissing plaintiffs’ action under § 1983 for failure to show any constitutionally protected right. Plaintiffs have shown no issue of material fact requiring trial. Accordingly, the first two counts of the complaint are dismissed as against all defendants.

II.

Even if the competent evidence showed a violation of § 1983, the actions against defendants Gliedman and Silver-man in their individual capacities would be precluded by their qualified immunity. It is well settled law that government officials acting within the course of their employment are entitled to a qualified immunity from civil damages; this protects them from liability in damages if their conduct did not violate clearly established federal statutory or constitutional rights of which a reasonable person would have known. Harlow v. Fitzgerald, 457 U.S. 800, 818, 102 S.Ct. 2727, 2738, 73 L.Ed.2d 396 (1982). Indeed, as established in Davis v. Scherer, 468 U.S. 183, 104 S.Ct. 3012, 3020, 82 L.Ed.2d 139 (1984), the defendants would not lose this immunity even if their conduct violated state law. In light of my determination discussed above (pp. 5-8) that defendants violated no constitutional right of plaintiffs, it follows that the individual defendants can have no personal liability for damages. But if it were held otherwise as to whether plaintiffs had shown a violation of the constitutional rights, no such rights were “clearly established” at the time of the events. See Harlow, supra 457 U.S. at 818, 102 S.Ct. at 2738. Gliedman and Silverman are therefore within their qualified immunity and are entitled to summary judgment dismissing the action.

III.

The claims against the officials in their “official capacity” seek damages against the governmental entity of which the officers are agents, in this case the City of New York. Brandon v. Holt, — U.S. -, 105 S.Ct. 873, 878, 83 L.Ed.2d 878 (1985); Monell v. New York City Dept. of Social Services, 436 U.S. 658, 690 n. 55, 98 S.Ct. 2018, 2035 n. 55, 56 L.Ed.2d 611 (1978).

In Monell, supra, the Supreme Court held for the first time that cities were liable to suit under § 1983. The Court did not extend this liability to all acts by City officials resulting in violations of federal law, but only to those acts which reflected an official policy or custom. Monell, supra, at 690-93, 98 S.Ct. at 2035-37. Kentucky v. Graham, — U.S. -, 105 S.Ct. 3099, 3106, 87 L.Ed.2d 114 (1985). As the Court of Appeals has explained: “Absent a showing of a causal link between an official policy or custom and the plaintiffs’ injury, Monell prohibits a finding of liability against the City.” Batista v. Rodriguez, 702 F.2d 393, 397 (2d Cir.1983). Plaintiffs, have failed to make this showing.

Plaintiffs neither contend nor submit evidence that it was the policy or custom of the City to evict squatters without notice and an opportunity to be heard. Indeed, plaintiffs concede the contrary in their 3(g) Statement (¶ 13). Consequently, there is not even an issue in this ease whether the City is liable in damages under Monell, and the City is entitled to summary judgment dismissing the claims under § 1983.

SO ORDERED.

      . The action also involves complaints of legal tenants. Those are not involved in this motion.

      . Plaintiffs’ papers advise that the correct spelling of plaintiff’s name is del Villar. The complaint spelled it as it appears in the caption; if plaintiffs wish to amend the caption, counsel should take the appropriate steps.

      . Constance Hotaling was placed under arrest and detained in a police van for an hour. Steven Jones, a plaintiff not implicated in this motion, was also placed under arrest, handcuffed and detained in a police van for two hours. The charges against Jones and Hotaling were subsequently dismissed. Complaint, ¶ 37.

      . As required, both individual defendants affirmatively pleaded their good faith in their affidavits before this court.

      . Plaintiffs allege in their 3(g) statement that: "The City had a regular and consistent policy and practice, breached only in the case of 126 LaSalle Street, of evicting squatters only through legal proceedings rather than forcible police action.” Plaintiffs’ 3(g) Statement, If 13.