author: AGUILAR, District Judge.

text:
    Vivian JOHNSON, Plaintiff, v. Margaret M. HECKLER, Secretary of Health and Human Services, Defendant.
    No. C 84-20065 RPA.
    United States District Court, N.D. California, Ninth Division.
    May 6, 1985.

      Jeffrey Preefer, San Jose, Cal., for plaintiff.
    Gary Hall, Asst. U.S. Atty., San Francisco, Cal., for defendant.
   OPINION AND ORDER

AGUILAR, District Judge.

Plaintiff brings this action pursuant to section 205(g) of the Social Security Act, 42 U.S.C. § 405(g), to obtain judicial review of a final decision of the Secretary of Health and Human Services denying her application for widow’s disability benefits under §§ 202(e) and 223 of the Act, 42 U.S.C. §§ 402(e), 423. Pursuant to the special order governing Social Security review cases, this matter has been submitted without oral argument on cross-motions for summary judgment. This Court concludes that the administrative law judge (“AU”) used improper legal standards in weighing the evidence presented. The case is therefore remanded to the Secretary for reconsideration in accordance with this opinion.

Plaintiff claims that she has a continuing disability that began in September 1980. Plaintiff was employed from March 1982 to May 1982, but urges that this employment be viewed as an unsuccessful work attempt rather than as a period of gainful employment. Plaintiff bases her claim for disability on psychiatric difficulties, including a somatization disorder that allegedly causes her disabling pain. The AU concluded that because plaintiff demonstrated no physical or psychological impairments that met or equalled those in the listing of impairments in Appendix 1 of subpart P of the regulations, a finding of “not disabled” was mandated.

LEGAL STANDARDS

Proof of disability in a widow’s benefits case requires a showing that the widow has an impairment with specific clinical findings that are the same as or medically equivalent to those in the listing of impairments in Appendix 1 of the regulations, or that she has one or more unlisted impairments that singly or in combination are the medical equivalent of a listed impairment. 20 C.F.R. §§ 404.1578, 404.1522. An “impairment” for purposes of this definition “results from anatomical, physiological, or psychological abnormalities which are demonstrable by medically acceptable clinical and laboratory diagnostic techniques.” 42 U.S.C. § 423(d)(3). The impairment must be expected to result in death or have lasted or be expected to last for a continuous period of not less than 12 months. 42 U.S.C. § 423(d)(1)(A), 20 C.F.R. § 404.1577.

On judicial review, the Secretary’s determination that a plaintiff is not disabled will be upheld if the findings of fact are supported by substantial evidence, 42 U.S.C. § 405(g), and if the Secretary applied the proper legal standards. Kail v. Heckler, 722 F.2d 1496, 1497 (9th Cir.1984); Delgado v. Heckler, 722 F.2d 570, 572 (9th Cir.1983). Where the proper legal standards are not applied by the AU in weighing the evidence, the decision should be set aside even if the findings are supported by substantial evidence. Benitez v. Califano, 573 F.2d 653, 655 (9th Cir.1978); Lebus v. Harris, 526 F.Supp. 56, 59 (N.D.Cal.1981).

DISCUSSION

I

Plaintiff contends that the AU erred in failing to consider plaintiff’s allegations of pain in determining whether or not she was disabled. Severe pain can be disabling and can provide a basis for the grant of benefits. See, e.g., Embry v. Secretary of Health, Education, and Welfare, 626 F.2d 93, 94 (9th Cir.1980). However, the regulations require that there be medical signs or findings showing that there is a medical condition that could reasonably be expected to produce the pain symptoms. 20 C.F.R. § 404.1529. Thus, the AU can disregard a plaintiff’s self-serving allegations of pain if they are unsupported by objective evidence. Maounis v. Heckler, 738 F.2d 1032 (9th Cir.1984); Coats v. Heckler, 733 F.2d 1338, 1340 (9th Cir.1984).

The requirement of objective evidence and medically acceptable clinical techniques is not, however, a requirement for a proven physical etiology of pain. To the contrary, a plaintiff’s subjective symptoms of pain are a significant factor to be weighed in determining whether a disability, as defined in the Act, exists. Gallant v. Heckler, 753 F.2d 1450, 1456 (9th Cir. Dec. 6, 1984) (citing Mark v. Celebrezze, 348 F.2d 289, 292 (9th Cir.1965); Karp v. Schweiker, 539 F.Supp. 217, 219 (N.D.Cal.1982). This is true even when examining physicians are unable to pinpoint specific organic causes for the pain. Stewart v. Harris, 509 F.Supp. 31, 33 (N.D.Cal.1980); see Duns v. Heckler, 586 F.Supp. 359, 363-64 (N.D.Cal.1984). It is sufficient that the clinical tests establish the existence of medical conditions sufficiently serious so as to be capable of causing the pain. Duns, supra, 586 F.Supp. at 364; Karp v. Schweiker, supra, 539 F.Supp. at 220).

Psychological conditions, as well as physical conditions, are “medical conditions” within the meaning of the Act. See Appendix 1, 20 C.F.R. 401.100 (listing of impairments). In both cases, a determination that there is an impairment that is medically equivalent to a listed impairment must be supported by medically acceptable clinical and laboratory diagnostic techniques. 20 C.F.R. § 404.1526. However, the techniques used to establish the existence of a disabling condition differ in physical and psychological cases. Thus,

“[w]hen mental illness is the basis of a disability claim clinical and laboratory data may consist of the diagnoses and observations of professionals trained in the field of psychopathology. The report of a psychiatrist should not be rejected simply because of the relative imprecision of the psychiatric methodology or the absence of substantial documentation, unless there are other reasons to question the diagnostic technique.”

Lebus v. Harris, 526 F.Supp. 56, 60 (N.D.Cal.1981).

Plaintiffs primary treating psychiatrist stated that, despite the lack of physical findings, plaintiff experiences very severe, “real pain” as great as or greater than that caused by a verifiable physical illness, and that the existence of multiple sites of pain without apparent organic cause is a common symptom of somatization disorder. There is, therefore, objective medical evidence, albeit not physical evidence, that plaintiff in fact experiences severe pain.

Plaintiffs allegations of severe pain must therefore be considered in determining whether or not she is disabled. If the pain is determined to be related to plaintiffs somatization disorder, as appears from the record, the Secretary must determine whether the medical findings are equivalent to those listed in Appendix 1 of the regulations. If the pain is not related to plaintiffs other impairments, either because it results from a separate psychological or separate physical impairment, the Secretary must consider the combined effect of the unrelated impairments. 20 C.F.R. § 404.1522; Stewart, supra, 509 F.Supp. at 35. She must also make a specific and well-articulated finding as to the effect of the combination of impairments. Id. The AU erred in finding, without considering plaintiffs complaints of pain, that there was no proof of a consistent severe psychiatric disorder that meets the requirements of the listing of impairments.

II

Plaintiff further contends that the AU erred in according insufficient weight to the determinations of plaintiffs treating physicians that she was disabled. Although the AU must make his own determination of disability based on the medical findings, 20 C.F.R. § 404.1527, the opinion of a claimant’s treating physician is entitled to great or substantial weight. Duns, su pra, 586 F.Supp. at 363; Stewart, supra, 509 F.Supp. at 34. Moreover, the courts have been wary of conclusions drawn by physicians who make a determination as to disability on the basis of a review of records alone, and have found that the testimony of such physicians cannot alone constitute substantial evidence. Gallant, supra, at 6; Justice v. Schweiker, 587 F.Supp. 648, 652 (N.D.Cal.1984); Karp, supra, 539 F.Supp. at 219. The ALJ apparently, and improperly, gave conclusive weight to the determinations of the reviewing physicians in this case, who based their conclusions only on a review of the records.

The ALJ based his finding of “no disability” in part on his observations of plaintiff at the hearing. An AU’s observation of the claimant at a hearing, at least in cases involving alleged psychological disability, does not provide a sufficient reason to reject otherwise uncontroverted medical evidence. Montijo v. Secretary of Health and Human Services, 729 F.2d 599, 602 (9th Cir.1984); see Rhodes v. Schweiker, supra, 660 F.2d 722 at 724; see also Day v. Weinberger, 522 F.2d 1154, 1156 (9th Cir.1975).

If the AU wishes to disregard the opinion of the treating physician, he or she must make findings setting forth specific, legitimate reasons for doing so that are based on substantial evidence in the record. Murray v. Heckler, 722 F.2d 499, 502 (9th Cir.1983); see Stewart, supra, 509 F.Supp. at 34 (AU should state why certain evidence was accepted and other evidence was rejected). Similarly, although the AU has discretion to determine that the plaintiffs complaints of pain are not credible, he must make a specific finding to that effect, must articulate his reasons for the finding, and must indicate the amount of weight given to various items of evidence. Rhodes v. Schweiker, 660 F.2d 722, 724 (9th Cir.1981); Lewin v. Schweiker, 654 F.2d 631, 635 (9th Cir.1981). The AU in this case made no findings as to the reasons for rejecting either the opinions of plaintiffs treating physicians or plaintiffs own allegations regarding her pain.

Ill

Plaintiff also argues that the AU applied improper legal standards by not considering whether plaintiffs employment from March 1982 to May 1982 was an unsuccessful work attempt. The Secretary argues that because plaintiff was in fact briefly employed, she must necessarily be found “not disabled.”

42 U.S.C. § 423(d)(2)(B) provides that a widow or widower shall not be found disabled unless her impairment is of a level of severity which under regulations pre scribed by the Secretary is deemed to be sufficient to preclude an individual from engaging in any gainful activity. 20 C.F.R. § 404.1577 repeats this definition of widow’s disability. However, 20 C.F.R. § 404.1578, encaptioned “how we determine disability for widows,” provides in subpart (b) that “we will not find you disabled if you are doing substantial gainful activity” (emphasis added). Section 404.1579 provides that a disability will be found ended in the earlier of 1) the month the claimant’s impairments fail to meet or equal one of the listed impairments, or 2) in the month the claimant does substantial gainful activity. The regulations therefore specify that, in determining whether plaintiff’s employment from March through May 1982 constituted an end to an earlier period of disability, assuming a disability were found in the earlier period, the substantial gainful activity standard must apply.

The ALJ must be guided by section 404.-1573 of the regulations in making findings on this point. Particular emphasis should be given to section 404.1573(b), which provides:

“[w]e consider how well you do ■ your work when we determine whether or not you are doing substantial gainful activity. If you do your work satisfactorily, this may show that you are working at the substantial gainful activity level. If you are unable, because of your impairments, to do ordinary or simple tasks satisfactorily without more supervision or assistance than is usually given other people doing similar work, this may .show that you are not working at the substantial gainful activity level.”

The AU apparently did not consider the evidence in the record regarding plaintiff’s lack of success in her employment. He noted only that the claimant “did perform at some level at least with certain subsidies.” This indicates that the AU was applying an “any gainful activity” rather than a “substantial gainful activity” standard in making his determination.

An additional factor is relevant to the determination of whether this period of employment provides evidence that plaintiff is not disabled. While in cases involving physical impairments a finding of disability may be negated by the presence of symptom-free periods, “symptom-free intervals do not necessarily compel such a finding when a mental disorder is the basis of the claim.” Lebus v. Harris, 526 F.Supp. 56, 61 (N.D.Cal.1981). The relevant inquiry in cases involving psychiatric disorders is whether a claimant can engage in any substantial gainful employment during the symptom-free intervals, given the likelihood, frequency, and severity of relapses in his or her mental illness. Id. It is not clear from the record if plaintiff was symptom-free during this period, or if she had continuing symptoms which contributed to the lack of success in her work attempt. However, the necessary inquiry is even more relevant in such periods than in completely symptom-free periods.

The AU noted that there was strong evidence in February 1982 that the criteria, of the listing of impairments were met. However, he stated that because plaintiff was certified to return to work, the duration requirement of the Act was not met. The statement indicates that the AU was improperly guided by the rule for physical rather than psychological disability cases' in determining whether or not plaintiff’s three-month period of employment demonstrated that she was not in fact disabled.

.CONCLUSION

Having reviewed the AU’s decision, the Court concludes that improper legal standards were applied to determine plaintiff’s eligibility for widow’s disability benefits. The case must be remanded to the Secretary for reconsideration of the evidence in accordance with the standards presented in this opinion. If, on reconsideration, the AU rejects the opinions of plaintiff’s treating physicians and the credibility of her own allegations of pain, he or she must provide clear and convincing reasons for such findings. Accordingly,

IT IS HEREBY ORDERED that plaintiffs motion for summary judgment is DENIED;

Defendant’s motion for summary judgment is DENIED;

This case is REMANDED to the Secretary for reconsideration in accordance with this Order and Opinion.

IT IS SO ORDERED.

      . The Lebus court recognized, however, that "certain objective tests have and are being devel- , oped to facilitate the diagnosis and verification of certain mental disorders, and therefore, this opinion should not be construed as relaxing the requirement of objective data wherever it is possible to obtain such data.” Id. at 61. There is no indication in the record that this type of data is available in this case.

        . Dr. Snider, plaintiff's treating psychiatrist throughout most of the period in question, concluded that the somatization disorder, in combination with plaintiff's generalized anxiety disorder and depression, prevented her from being gainfully employed. He found that she was disabled from September 1980 through March 1982, and from June 1, 1982, through November 29, 1982, at which time plaintiff began treatment with another psychiatrist. Dr. DeFino, one of plaintiff's treating physicians, noted on March 8, 1983, that she "cannot hold a job, etc.” Her subsequent psychiatrist, although unwilling to enumerate her difficulties because he found this futile and likely to perpetuate the disability, noted that “her past complaints have been very real ones in my opinion, and ones that in many situations produce lasting disability.”

      . The ALJ stated that "Regulation 4, section 404.1505 specifically states that a finding of equivalency must be made on ‘medical judgment furnished by one or more physicians designated by the Secretary.’ ” The ALJ was apparently referring to section 404.1526, which states that, in determining whether there is medical equivalence based on medical findings, “[w]e will also consider the medical opinion given by one or more physicians designated by the Secretary in deciding medical equivalence.” The plain meaning of the section is that the finding of the physician designated by the Secretary is a factor in the determination of medical equivalency, not that it is the sole basis for this judgment.

      . The findings of plaintiffs physicians as to the reality of her pain are uncontradicted. The reports of the two reviewing physicians for the Secretary who examined plaintiff’s records contain no evaluation of the reality of plaintiffs pain. They note only that there was no physical etiology for her complaints (except at extremes of movement) and that the objective physical evidence did not indicate an impairment that would preclude claimant from performing her normal daily activities. As already discussed, such objective physical evidence is not required in cases such as this, in which the clinical psychiatric evidence provides an explanation for the claimant’s complaints.


source: Caselaw Access Project

author: FULLAM, District Judge.

license: Public Domain

text:
    Virginia PARKER, Executrix of the Estate of Arthur W. Parker, Deceased, and Virginia Parker in her own right v. BELL ASBESTOS MINES, LTD., et al. Leroy HALL v. LAC D’AMIANTE DU QUEBEC, LTD., et al. Edward O. COOK and Barbara Cook, his wife v. CAREY CANADA, INC., et al.
    Civ. A. Nos. 83-3289, 84-130 and 83-1516.
    United States District Court, E.D. Pennsylvania.
    May 6, 1985.
    Robert E. Paul, Philadelphia, Pa., for plaintiffs.

      Daniel Segal, Philadelphia, Pa., for Charter.
    Vincent McGinness, Philadelphia, Pa., for Lac D’Amiante.
   MEMORANDUM AND ORDER

Before FULLAM, BECHTLE and SHAPIRO, District Judges.

FULLAM, District Judge.

The three judges to whom the captioned cases are assigned have jointly heard argument on the pending motions of defendants Charter Consolidated, P.L.C. and Charter Consolidated Investment, P.L.C. for summary judgment. The motions raise essentially identical issues in the three cases, issues which may have significant impact upon a great many pending asbestos-related cases. This Memorandum expresses the views of the three judges involved, and disposes of the summary judgment motions in all three cases. The differences among the three cases, in their facts and the precise details of the pleadings, have no bearing on the pending motions. Where necessary for purposes of illustration, the record in the Parker case will be utilized.

Plaintiffs, citizens and residents of Pennsylvania, seek to recover damages occasioned by their, or their decedents’, exposure to asbestos in the course of their employment, during various periods between 1941 and 1981. The ultimate issue presented by the pending Motions for Summary Judgment is whether plaintiff may have a legal basis for imposing liability upon the moving defendants, Charter Consolidated, P.L.C. (“Charter”), Charter Consolidated Investments, P.L.C. (CCI) (hereinafter sometimes jointly referred to as “the Charter defendants”).

Plaintiffs allege, in substance, that the Charter defendants “mined, manufactured, produced and/or sold asbestos fiber and/or asbestos products either directly or indirectly to the plaintiff’s employer” (Parker Complaint, II 2(e), (f)). Actually, as all parties acknowledge, the Charter defendants have never themselves mined or sold or supplied asbestos or asbestos products; their involvement in this litigation is predicated upon their relationship with Cape Industries, an English holding company which, in turn, through its wholly owned subsidiaries, was engaged in the mining and sale of asbestos in South Africa, during the relevant period. Charter owns CCI, which is operated essentially as the investment division or department of Charter; CCI owns 67.3% of the stock of Cape Industries which, until June 1979, was extensively engaged in asbestos mining and sale, through wholly owned subsidiaries.

For many, many years, asbestos mined and sold by Cape Industries was marketed extensively in this country; indeed, Cape Industries had an American subsidiary, North American Asbestos Corp., which handled the marketing and distribution of its products throughout this country.

Cape Industries, North American Asbestos, and various other subsidiaries of Cape Industries, were named as defendants in a great many asbestos-related lawsuits in this country. In the latter part of 1977, the Cape Industries interests paid $1.1 million as their share of a settlement of certain asbestos-related litigation in Texas. On the very day when this occurrence came to the attention of the Cape Industries Board, the Board agreed promptly to implement a

re-organisation of the Group’s asbestos selling arrangements, particularly in the U.S.A., which in future would be more closely controlled from South Africa. As part of this re-organisation it is proposed that North American Asbestos Corporation should be wound up. -n,

Ex. 3 to supplemental brief of Lac D’Ami-ante du Quebec, Ltd., at p. 3. The dissolution of North American Asbestos Corporation was completed as of May 1978.

At about the same time, acting on the basis of extensive legal advice from both English and American lawyers, Cape adopted, and has since carried out, a firm policy of simply ignoring litigation against it in courts in the United States, on the theory (which, at least for present purposes, must be deemed valid) that default judgments against it in American courts cannot be enforced against it in England or elsewhere (see, e.g., Charter’s annual report for 1982, quoted in LAQ’s supplemental brief at p. 5 n. 5). Apparently, Cape has also instructed its insurers not to defend any such lawsuits (id. p. 4 & n. 3).

In June 1979, Cape completely divested itself of its asbestos-mining subsidiaries. The mines were sold to Transvaal Consolidated Land and Exploration Company (TCL), a South African concern. Cape obligated itself to indemnify the purchaser against valid and enforceable judgments arising out of asbestos litigation then pending or instituted within three years after the sale; but it was a condition of the indemnity agreement that the purchaser would not appear in, defend, or otherwise participate in any such litigation in the United States (i.e., TCL would continue the policy of allowing default judgments to be entered).

Plaintiffs and the other parties opposed to the Charter defendants’ motions contend that the Charter defendants exercised direct control over these decisions and actions by Cape Industries, and that the circumstances warrant imposition of liability directly upon the Charter defendants, without regard to the formalities of the corporate structure. That is, they argue that the Charter defendants represent merely the alter ego of Cape Industries, and that the corporate veil should be pierced.

In support of their summary judgment motions, the Charter defendants advance a host of arguments: the corporate structure was adopted for perfectly legitimate reasons having nothing to do with asbestos litigation; the evidence establishes that the Charter defendants did not in fact exercise the required degree of control over Cape Industries; the eomplained-of actions by Cape Industries were neither fraudulent, illegal, nor contrary to public policy, but merely self-protective; and there is no precedent for imposing alter- ego liability except in the ease of closely held corporations.

DISCUSSION

The parties agree that Pennsylvania law is applicable in this diversity litigation. In Pennsylvania, as in most jurisdictions, it is permissible to disregard corporate formalities only in exceptional circumstances. See, e.g., Zubik v. Zubik, 384 F.2d 267 (3d Cir.1967), cert. denied, 390 U.S. 988, 88 S.Ct. 1183, 19 L.Ed.2d 1291 (1968). The corporate entity being disregarded must be so controlled as to have essentially no “mind” of its own; but this alone is insufficient. There must also be a showing that the corporate entity is being used “to defeat public convenience, justify wrong, protect fraud or defend crime”. Sams v. Redevelopment Authority, 431 Pa. 240, 244, 244 A.2d 779, 781 (1968). More recently, the Pennsylvania Supreme Court has observed that the “legal fiction of a separate corporate entity was designed to serve convenience and justice, ... and will be disregarded whenever justice or public policy demand and when the rights of innocent third parties are not prejudiced nor the theory of the corporate entity rendered useless.” Ashley v. Ashley, 482 Pa. 228, 237, 393 A.2d 637, 641 (1978).

The test is the same when the corporate relationship involves a parent and subsidiary. Like a majority shareholder in any corporation, the corporate parent is not liable for the acts of the corporate subsidiary unless the parent actually exercises control of the subsidiary. See Botwinick v. Credit Exchange, Inc., 419 Pa. 65, 213 A.2d 349 (1965); 1 C.V. Swearingen, Fletcher Cyclopedia of the Law of Private Corporations, § 43 at p. 474 (rev. ed. 1983). The decision in each case is fact-specific. As indicia of control, courts tend to look to such matters as shared officers and directors, and the extent of the parent’s domination of the subsidiary’s policies, practices, and finances. See, e.g., In re Penn Central Securities Litigation, 335 F.Supp. 1026 (E.D.Pa.1971); Fletcher, supra, § 43 at p. 472 and supplement § 43.20 at p. 34. No one factor is alone dispositive.

An appropriate starting point on the issue of control is the decision in Barber v. Pittsburgh Corning Corp., 317 Pa.Super. 285, 464 A.2d 323 (1983), allocatur denied, Dec. 27, 1983, cert. denied, — U.S. -, 104 S.Ct. 2387, 81 L.Ed.2d 346 (1984). It was there held that Pennsylvania courts could properly exercise personal jurisdiction over Charter in an asbestos case arising out of Cape’s activities in the state. Reviewing a record much the same as the record now before us, the court found that Charter’s relationship with Cape was one of “total involvement.” 464 A.2d at 329.

The Charter defendants argue that the standard applied by the Barber court in reaching its jurisdictional decision is less stringent than the one to be applied on the issue of control in the veil-piercing context. We disagree. The jurisdictional question is resolved by looking to the control issue only. While this does not resolve the broader issue of disregard of corporate entity, it satisfies the first aspect of the test for veil-piercing. Indeed, many of the cases relied upon by all parties to describe the control necessary to pierce the corporate veil are cases concerned with the threshold issue of personal jurisdiction. See, e.g., Botwinick, supra; Hargrave v. Fibreboard Corp., 710 F.2d 1154 (5th Cir.1983).

The Barber court’s discussion of Charter’s control over Cape reflected but one of two alternative bases for its decision and, arguably, may be dictum; but it is nevertheless persuasive. Our own independent review of the voluminous record in this case persuades us that, at the very least, there are substantial issues of material fact as to whether Charter’s control of Cape is sufficiently pervasive to satisfy the first prong of the veil-piercing test. On this record, the Charter defendants are not entitled to summary judgment on that issue.

Upon its formation, Charter owned, by virtue of the involvement with Cape of one of Charter’s forerunners, Central Mining & Investment Corp. (CMIC), 16.8% of the shares of Cape’s stock. One to two CMIC executives sat on Cape’s Board before the merger, and this practice was continued by Charter. Gradually, Charter began increasing its ownership of Cape. In 1969, Charter successfully attempted a “takeover” (so-called by Cape’s chairman and managing director at the time, Ronald Dent — see Dent Deposition at 48-49), of Cape, as a result of which it acquired nearly 63% of Cape’s common stock, and all of its preferred shares. At present, Charter’s share of Cape’s common stock has increased to 67.3%.

In making its 1969 tender offer, Charter advised Cape’s shareholders that Charter’s business

is allied to the building and light engineering activities of Cape and it is in the opinion of Charter desirable to make use of the wide experience of Cape’s management to expand and develop this side of the Charter group’s activities.
However, Charter’s present holding of 25.3 percent in Cape is clearly not sufficient if that company is to be the main channel for the expansion of Charter’s industrial activities; it was, therefore, considered necessary to acquire a considerably larger holding which would give Charter control of Cape.

Rudland Ex. A at 1493; see also Rudland Ex.B at 1434.

Cape thus became Charter’s “principal industrial subsidiary”. See Ex. 8, Appendix to LAQ’s supplemental brief, at 2198. Not surprisingly, Charter then increased its representation on the Cape Board to three directors. (Dent testified that he assured Charter’s managing director Sidney Spiro that two directors would be sufficient since the Cape Board voted by consensus; nevertheless, Spiro demanded three and Dent acquiesced. Dent at 70.) These directors were members of the Charter Board’s Executive Committee — a committee composed of Charter Board members who also typically functioned as department or division heads; the Executive Committee, which met two to three times each week, was responsible for Charter’s day-to-day operations and for the oversight of Charter’s investments. See Stopford-Sackville at 29, 35.

Charter is careful to point out that its nominees to Cape’s Board were non-executive directors, meaning that they served “only” on Cape’s Board, but not on its executive committee. Nevertheless, one may not ignore the fact that these non-executive directors typically served Cape as deputy chairman (whose duties included membership in the committee which set the salary and remuneration of all of the directors) and as chairman of the Board, and that Cape did not even have an executive committee until some time after the Charter Board suggested that one be formed in 1967. Rudland Ex.B at 1426. And, quite obviously, the role of the nominees was not simply to “mind” the Cape investment, but to convey to Cape the views of the parent and see to their implementation. The minutes of the meeting of Charter’s Executive Committee on October 29, 1970, for example, contain the following reference to Cape:

Discussions have taken place with Cape directors concerning the future management of that group. It has been decided that Mr. R.H. Dent should continue as Chairman but the position of Managing Director, which he has held hitherto, will be filled by Mr. G.A. Higham from the 1st January 1971. Mr. F.P. Parks will be Assistant Managing Director.

Rudland Ex.B at 1454. At this meeting, inter alia, were Sidney Spiro, Managing Director of Charter and Deputy Chairman of Cape’s Board, and Lionel G. Stopford-Sackville, also a member of Cape’s Board.

Stopford-Sackville recalled a luncheon meeting attended by Charter’s nominees to the Cape Board and the other non-Charter non-executive Board members, at which it was decided that Higham should replace Dent, subject to Spiro’s “canvassing” the executive directors, except for Higham and Dent. Stopford-Sackville at 124. Dent testified that he too was at this meeting and had suggested Higham and Parks for the position. Dent at 128, 136. Spiro remembered that Dent himself determined who his successor should be. Spiro at 38.

But the question is not simply one of succession; a determination was being made as to how Cape should be run. Dent testified that it was Spiro who initiated the idea of a change in the structure of Cape’s leadership, asking Dent to think about giving the role of managing director to someone else and to suggest possible successors. Dent at 127-28. Nor did this occur, as Spiro suggested, shortly before Mr. Dent’s retirement. Spiro at 38. Dent remained as chairman of Cape until 1979, when he was replaced by Stopford-Sack-ville of Charter and then by Higham. Dent did, however, begin to draw his pension when he gave up his position as an executive director in 1975, five years after the luncheon meeting. Dent at 6.

Moreover, shortly after Charter’s acquisition of its majority interest in Cape in 1969, Spiro asked Dent to take on the chairmanship of three wholly owned industrial subsidiaries. Dent at 124-25. (It would thus appear that Spiro’s repeated assertions that this was done after Dent stepped down as managing director of Cape in January of 1971 may be erroneous. See Spiro at 15-16.) And, notwithstanding Spiro’s statement that Dent’s service in this role was only “a very short-lived experience” (Spiro at 35), Dent testified that he served in this capacity for three years and then stepped down voluntarily (Dent at 125).

As noted above, Dent remained on the Charter Board until he retired as chairman of Cape in 1979. One year later, Higham assumed that role (he was still managing director of Cape) and was appointed to the Charter Board. That same year, Higham was “seconded” by Charter, the result being that he spent half his time with Cape and half with Charter. In so doing, he relinquished his role as managing director of Cape but retained Cape’s chairmanship and his benefits with the company. At the same time, he assumed the leadership of Charter’s Industrial Division and is thus on Charter’s Executive Committee. He is paid by Charter (Cape is apparently debited for its. share, of him), and he testified: “I normally go to Cape on Monday and Tuesday each week and I go to Charter on Wednesday and Thursday each week and on Friday I do whatever is necessary.” Higham (April 8, 1981) at 177.

There is more — more Charter Executive Committee minutes evincing Charter’s desire to impose certain policies on Cape’s management (see, e.g., Rudland, Ex. B at 1459, 1464, 1465, 1469) and, as Stop-ford-Sackville noted, Cape usually fulfilled Charter’s desires (Stopford-Sackville at 80-81); Charter’s role as registrar for Cape and underwriter of two rather large share issues by Cape (see, e.g., Rudland Ex. A at 1487, Ex. B at 1444,1451); Charter’s consolidation, in compliance with English law, of Cape’s profits with its own; and so on — but in light of the foregoing, it is not necessary to describe the corporate interconnections in any greater detail. Making every inference in favor of the party moved against, as we are required to do at this stage, it is clear that the evidence of Charter’s control of Cape presents a genuine issue of fact.

We thus proceed to the second part of the test for disregarding the corporate veil. As noted above, the equitable doctrine quite logically provides that the corporate entity may be disregarded where it is being used in an inequitable fashion.

Charter makes much of the fact that the courts of Pennsylvania and elsewhere require illegality or fraud in order to pierce the corporate veil, and that none of Cape’s activities, even if they are attributed to Charter, constitute such egregious behavior. We assume, however, that when the Pennsylvania Supreme Court repeatedly states that the corporate entity may not be used “to defeat public convenience, justify wrong, protect fraud or defend crime,” and that the form will be disregarded “whenever justice or public policy demand....,” the court means exactly what it says. See Ashley, supra, 482 Pa. at 237, 393 A.2d at 641; Sams, supra, 431 Pa. at 244, 244 A.2d at 781.

The fact that the Pennsylvania courts have not had occasion to elaborate on what is meant by inconvenience (the cases deal primarily with fraud), does not rob the term of its common meaning, nor deprive it of its legal effect. Long ago, the Supreme Court took note of the need to provide an American citizen with a forum in this country when the fund in dispute was located in England. See Phelps v. McDonald, 99 U.S. (IX Otto) 298, 25 L.Ed. 473 (1878). The Court asked: “[W]hy should not this question of paramount right be settled in this case, rather than that the American claimant should be subjected to the delay, expenses, and other inconveniences of a suit before a foreign tribunal?” Id. at 308. While we now possess methods superior to those existing in 1878 for crossing the Atlantic, most asbestos plaintiffs are ill-equipped to undertake the sort of trans-Atlantic, if not trans-global, litigation, neces-' sitated by Cape’s apparently evasive maneuvers. The expense alone supplies the inconvenience in this case. Add to that the ill-health and age of many of these plaintiffs, and there simply can be no doubt.

Nor can we ignore the state court’s admonition that the corporate form must be disregarded “whenever justice and public policy demand.” Thus, although limitation of liability is a legitimate benefit of incorporation, that benefit is lost where the corporate form is resorted to “deliberately, with specific intent to escape liability for a specific tort or class of torts.... ” Zubik, supra, 384 F.2d at 273. And there is no rational basis for distinguishing between formation of a corporation for these purposes and use of an already existing entity to achieve them. See Fletcher Supp. § 43.20 at 34. In either event, a distinction may be drawn between (1) carrying out the everyday affairs of corporate business {e.g., the mining and sale of asbestos) — the sort of activity which traditionally merits the privilege of limitation of liability bestowed by the protective corporate form; and (2) carrying out legal maneuvers aimed at maximizing the limitation of liability to a point of near invulnerability to responsibility for injury to the public. In our view, the latter, which may well be the situation here, constitutes an abuse of privilege, which in an equitable analysis of competing public policy considerations must surely fail.

As mentioned previously, the record reveals that on the same day that the Cape Board was advised of its $1.1 million contribution to a settlement of asbestos litigation in Texas, the Board proposed a

re-organisation of the Group’s asbestos selling arrangements, particularly in the U.S.A., which in future would be more closely controlled from South Africa. As part of this re-organisation it is proposed that North American Asbestos Corporation should be wound up.

Appendix to LAQ’s supplemental brief, Ex. 3 at 3. Present at this meeting were all three Charter executives who were nominees to Cape’s Board, including Cape’s deputy chairman. North American Asbestos Corp. (NAAC), a wholly owned subsidiary of Cape, was dissolved in May 1978.

Thereafter, acting on English and American legal advice, Cape’s management resolved that it would not appear in any asbestos suits brought against it in the United States (see Higham (July 5, 1984) at 62-63), the prevailing corporate belief being that default judgments entered against Cape in the United States could not be enforced against it in England. See 1982 Charter Annual Report, quoted in LAQ’s supplemental brief at 5 n. 5. Cape also appears to have instructed its insurers not to defend any such suits. See LAQ’s supplemental brief at 4 & n. 3.

In June 1979, Cape completely divested itself of its South African asbestos mines; the mines were sold to Transvaal Consolidated Land and Exploration Co. (TCL), a South African firm. The Cape-Charter board members recalled that negotiations for the sale originated perhaps as early as the mid-1970s for various reasons, including the decline in the profitability of asbestos ventures and the political obstacles involved in doing business with South African firms. See, e.g., Richardson at 28; Higham at 68; Dent at 82. None of these gentlemen could recall the sale being primarily motivated by a desire to be rid of liability-rich assets. As noted above, however, the agreement of sale indemnified TCL for any judgment arising out of asbestos claims existing at the time of sale or instituted within three years thereafter. The terms of the indemnification included the condition that the purchaser not appear to defend actions instituted in the United States; i.e., this protection was conditioned on TCL defaulting in American lawsuits. See Appendix to LAQ’s Supplemental Brief, Ex. 4 at C1000142-143. Thus, although as Higham observed, TCL was not thereby absolutely precluded from defending suits in this country, it was effectively deprived of whatever incentive it may have had to do so.

In our view, the issue whether Cape management, by these acts deliberately sought to escape liability is a second disputed issue of material fact which precludes the entry of summary judgment.

We do not, of course, hereby attach liability to Charter. It is clear, however, that if the plaintiff and LAQ can prove that Charter controls Cape, and that Cape has deliberately avoided liability to American plaintiffs, it will be fair to ask Charter to stay and defend Cape’s position. Motions denied.

      . Although plaintiffs do oppose the Motions for Summary Judgment, the most strenuous opposition comes from co-defendants, spearheaded by counsel for Lac D’Amiante du Quebec, Ltd.

      . On remand, the trial court in Barber granted Charter's Motion for Summary Judgment, without filing an opinion. Barber v. Pittsburgh Corning Corp., No. G.D. 79-21544 (Pa.C.P.Ct. Oct. 11, 1984); see also Westerby v. Raymark Industries, Inc., No. 83-61 (D.N.J. Jan. 22, 1985) (order granting Charter defendants' summary judgment motion).

      . Charter cites the opinion of Judge Takiff of the Philadelphia Court of Common Pleas, denying its Motion for Summary Judgment (because the record was incomplete), as support for its theory that a different standard applies. See Figueroa v. Charter Consolidated P.L.C., March Term 1983, No. 4351 (2123) (Phila.Com.P.C. June 12, 1984). A close reading of Judge Tak-iff's memorandum opinion reveals that he concluded only that Barber alone could not be used by the Figueroa plaintiffs to estop Charter from defending on the corporate veil theory; in so doing, he reasoned that "the corporate veil cannot be pierced merely by a showing of control"; rather, "it must be specifically proven that ‘one in control of a corporation uses that control, or uses the corporation assets, to further his or her own personal interests.'" Id. at 3 (citations omitted). The court left open the question whether Charter had sufficient control over Cape to pierce the corporate veil, and allowed plaintiffs further discovery on this issue.

      . By virtue of the name, it is difficult to accept the puzzling contention of Charter (and its many directors) that "none of the Charter nominees can identify NAAC as a Cape subsidiary which allegedly sold asbestos in the United States.” Charter Reply Memorandum at 48.

      . By necessary implication, we have rejected Charter's contention that post-tort (asbestos exposure) activities may not constitute the basis for piercing the corporate veil. See, e.g., Morgan. v. Burks, 93 Wash.2d 580, 611 P.2d 751 (1980) (post-tort fraudulent corporate conveyances were properly considered by the jury); Fletcher, supra, § 45 at 533. In any event, there is evidence that Charter was effectively in control of Cape by mid-1969, well before the events complained of occurred, and well within plaintiffs decedent’s exposure period.


author: OWENS, Chief Judge:

text:
    Jacqueline L. MADDOX, Plaintiff, v. GRANDVIEW CARE CENTER, INC., Defendant.
    Civ. A. No. 83-75-ATH.
    United States District Court, M.D. Georgia, Athens Division.
    May 6, 1985.
    Janet E. Hill, Athens, Ga., for plaintiff.
    Curtis L. Mack, Atlanta, Ga., for defendant.
   OWENS, Chief Judge:

. This is an employment discrimination action commenced under Title VII of the Civil Rights Act, 42 U.S.C.A. §§ 2000e et seq. (West 1981), wherein plaintiff alleges that she was forced to resign from her employment with defendant on account of her pregnancy. A nonjury trial was held on November 27-28, 1984. This order constitutes the court’s findings of fact and conclusions of law.

FINDINGS OF FACT

1. Defendant Grandview Care Center, Inc. operates a nursing home for elderly residents in Athens, Georgia. The Center normally cares for approximately 100 residents, and employs between sixty and sixty-five employees over three eight-hour shifts, thereby providing twenty-four hour care. The nursing staff consists of an RN Supervisor, LPN charge nurses, and nursing assistants.

2. Plaintiff Jacquelin Maddox was employed as a nursing assistant from December 22, 1981, until her termination on December 6, 1982. She worked on the night shift, from 11:00 p.m. to 7:00 a.m., for which she was paid $3.55 an hour, slightly more than minimum wage. In a June, 1982, performance evaluation, defendant rated her as an “excellent” and “dependable” employee.

3. In 1980, Mrs. Maddox became pregnant with her first child. Due to complications, the infant was born prematurely and died only fifteen hours after an emergency caesarean section delivery.

4. Mrs. Maddox learned that she was pregnant again in September of 1982. She was advised by her physician that she could expect complications with this pregnancy as well.

5. Mrs. Maddox indeed began experiencing illnesses related to her pregnancy. Upon advice from her physician, she requested and received a week of sick leave in early November, 1982.

6. Mrs. Maddox continued to experience complications with her pregnancy. Her physician advised against any strenuous activity, and a note to this effect was received by Mrs. Maddox’s supervisor.

7. On November 30, 1982, plaintiff met with her supervisor, Mr. Edwards, the Director of Nursing. She expressed her concerns for the health and safety of her unborn child, as well as her physician’s orders against strenuous employment. She then requested a leave of absence, without pay, to begin immediately and to extend through the duration of her pregnancy, approximately six months. Mr. Edwards told her that company policy only permitted a three month maternity leave of absence. He further advised her that even this three month leave of absence required the approval of Mrs. Williamson, the administrator, who at that time was out of town attending a sorority convention. Mr. Edwards was not authorized to act on plaintiff’s leave request; Mrs. Williamson had not authorized anyone to so act in her absence. Mrs. Maddox formally filed her request for a six month leave of absence on November 30th and did not return to work because of complications arising from her pregnancy.

8. The defendant’s leave of absence policies in effect in November and December of 1982 stated: “Maternity leave is limited to three months per employee.” For illnesses other than pregnancy, defendant’s policy provided that “leave of absence for illness may be granted on a doctor’s recommendation and with the administrator’s approval....” While defendant’s officers testified that an employee could request an extended leave of absence at the expiration of three months upon proof of an illness arising from pregnancy, this “policy” was not expressly set forth in the personnel manual, and neither Mrs. Williamson nor Mr. Edwards could name a single employee who had obtained such an extended maternity leave under the policy in effect in 1982. Trial Transcript Vol. II at 26; Vol. I at 74.

9. Defendant also had a policy which provided that an employee who failed to report to work for three consecutive workdays without calling and arranging a substitute would be subject to termination.

10. Mrs. Williamson did not review plaintiffs leave request until December 6, 1982. By this time, plaintiff had missed three consecutive workdays. She was called into the office and advised that she was being terminated for violating the three day rule. She was given the option to resign, which she accepted. Mrs. Williamson never ruled on her leave request.

CONCLUSIONS OF LAW

Defendant Grandview Care Center, Inc. is an employer subject to the requirements of Title VII. That act provides that “[i]t shall be an unlawful employment practice for an employer ... to discharge any individual ... because of such individual’s ... sex....” 42 U.S.C.A. § 2000e-2(a)(1) (West 1981). The act further provides:

The terms “because of sex” or “on the basis of sex” include ... because of or on the basis of pregnancy, childbirth, or related medical conditions; and women affected by pregnancy, childbirth, or related medical conditions shall be treated the same ... as other persons not so affected but similar in their ability or inability to work....

Id. § 2000e(k).

Defendant’s leave policy, as it existed in November of 1982, was discriminatory on its face. It expressly stated “[mjaternity leave is limited to three months per employee” (emphasis added), while a leave of absence for “illness” could be granted for an indefinite duration.

Defendant argues that its policy was' not facially discriminatory because a pregnant employee could obtain a three month maternity leave and then apply for an extended “illness” leave. However, the written policy is silent as to such a “possibility”; on its face it clearly states that any leave related to pregnancy and childbirth is limited to three months. Moreover, neither Mrs. Williamson nor Mr. Edwards could name a single instance in which such an extended leave had been granted to an employee already out on maternity leave. Trial Transcript Vol. II at 26; Vol. I at 74. Most importantly, when Mr. Edwards explained the leave policy to plaintiff on November 30th, he stated that maternity leave was limited to three months, and he did not volunteer any information about the possibility of an extension. Trial Transcript Vol. II at 58; 72. The court rejects defendant’s contention that the possibility of an extended leave cured the facially discriminatory treatment set forth in defendant’s policies; the contention is simply not credible in light of the actual application of those policies. The policy as presented to plaintiff was quite clear: as of November 30th, she was ineligible for a leave of absence for. the duration of her pregnancy, even though an absence of similar length was available to male employees for other health reasons. The facially discriminatory leave policy constitutes direct evidence of unlawful discrimination on account of pregnancy. See Trans World Airlines v. Thurston, — U.S. -, -, 105 S.Ct. 613, 620, 83 L.Ed.2d 523 (1985). The Same Decision Test

Defendant argues that plaintiff was terminated for violating the three day absence rule, not because she was pregnant. Therefore, defendant argues, the same decision to terminate would have been made regardless of the facially discriminatory leave policy. Because plaintiff has established direct evidence of discriminatory intent, i.e., the facially discriminatory leave policy, the defendant can prevail on this claim only by proving by a preponderance of the evidence that the same decision would have been reached despite the discriminatory leave policy. Lee v. Russell County Bd. of Education, 684 F.2d 769, 774 (11th Cir.1982).

On November 30, 1982, defendant, through its agent, Mr. Edwards, knew plaintiff was pregnant, it knew plaintiff’s physician had warned against strenuous exertion, and it knew that plaintiff, upon submitting her leave request, would not be reporting to work thereafter because of her pregnancy and her physician’s advice. Therefore, defendant was in fact advised by plaintiff that she would be absent during the three days in question. Thus, there was no basis for terminating plaintiff pursuant to the three day rule.

Defendant suggests that “[n]one of the medical evidence demonstrates that the plaintiffs pregnancy-connected condition was sufficiently egregious to justify her failure to report for duty on the [three] days_” Defendant’s Proposed Findings of Fact and Conclusions of Law, ¶ 6 at 10. This is absurd. Plaintiff had lost her first child because of complications during pregnancy. Then, in the midst of her second term, she began to experience the same complications. Her physician warned against working strenuously. The court is aware of no evidence more compelling than as presented by Mrs. Maddox. Defendant was fully aware of these circumstances, and knew that plaintiff would not return to work after November 30th. The defendant was totally unjustified in terminating Mrs. Maddox pursuant to the three day rule. The same decision to terminate would not have been made absent the discriminatory leave policy. Without the invalid leave policy limiting maternity leave to three months, plaintiff would have been granted a leave of absence for the duration of her pregnancy, just as any male employee would have received a leave of equal duration upon presentation of similarly compelling medical evidence. Defendant has not established by a preponderance of the evidence that the same decision would have been reached in the absence of its unlawful leave policy.

CONCLUSION

In summary, this court finds that plaintiff was terminated because of a facially discriminatory leave policy. When plaintiff was told that she could not receive a leave of absence for the duration of her pregnancy, she was faced with the untenable choice of losing her job or the risk of losing her baby. Because defendant would have allowed a leave of absence of an equivalent duration for any other health condition of comparable severity, plaintiff was the victim of unlawful discrimination because of her pregnancy. Defendant’s claim that she was terminated for failing to report to work for three consecutive days without prior notice is without any possible merit. This is a case that cries out for justice. The Pregnancy Amendment to Title VII provides a remedy for the injustice sustained by plaintiff. It is hereby ORDERED, ADJUDGED and DECREED that defendant Grandview Care Center, Inc. terminated plaintiff Jacqueline L. Maddox’s employment in violation of Title VII of the Civil Rights Act, 42 U.S.C.A. § 2000e-2 (West 1981). The parties are directed within fifteen days to advise the court if it will be necessary for the court to resolve the issue of damages in this case.

SO ORDERED, this 6th day of May, 1985.

      . Defendant’s leave policy provided no compensation during the period of absence. The only benefit extended was the assurance of a position with the company upon return, and a continuation of health insurance coverage (partially funded by the employee) during the absence.

      . In the alternative, even if defendant’s leave policies do not constitute "direct” evidence of discrimination, this court would not hesitate to find that plaintiff satisfied a burden of persuasion in establishing that defendant’s purported nondiscriminatory reason for terminating her was a mere pretext, and that plaintiff was unlawfully discharged because of her pregnancy.


author: VUKASIN, District Judge.

text:
    UNITED STATES of America, Plaintiff, v. $831,160.45 UNITED STATES CURRENCY, Defendant. Philip A. DeMassa, Valai Kraitamchitkul, Claimants.
    No. C-83-0363 JPV.
    United States District Court, N.D. California.
    May 6, 1985.

      Charles B. Burch, Asst. U.S. Atty., Joseph P. Russoniello, U.S. Atty., San Francisco, Cal., for the U.S.
    Robert A. Van Nest, Kathryn E. Ma, Keker & Brockett, San Francisco, Cal., for claimant Philip DeMassa.
    Robert E. Carey, Jr., Carey & Carey, Palo Alto, Cal., for claimant Valai Kraitam-chitkul.
   AMENDED ORDER OF FORFEITURE

VUKASIN, District Judge.

The present forfeiture action results from the seizure of a large sum of unreported currency by agents of the Department of Customs [Customs] as the money was being transported out of this country via San Francisco International Airport. The currency’s possessor having died in the interim, the remaining claimants contest the constitutional propriety of both the initial seizure and the ensuing forfeiture proceding, and have now moved for summary judgment on their claims. The United States, in turn, has filed a motion for summary judgment of forfeiture. These matters came on regularly for hearing before this Court, the Honorable J.P. Vuka-sin, Jr., presiding. Having considered the arguments of counsel, both written and oral, and all the pleadings submitted, the Court now issues this Amended Order of Forfeiture.

Facts

The material facts of this case are undisputed. On September 4, 1981, at shortly after one o’clock p.m., Sunthorn Kraitam-chitkul, a Thai national, presented himself at the Pan American ticket counter at San Francisco International Airport [SFO] and, using a ticket which had been purchased in his name the previous August 22 in Bangkok, Thailand, registered for a Pan American Airways flight scheduled to depart for Hong Kong at 2:30, little more than one hour hence. After an examination of his international travel documents, Kraitam-chitkul checked through to Hong Kong one piece of luggage and received his boarding pass. He then proceeded to the departure area, taking with him various pieces of carry-on baggage.

Prior to entering the departure gate in preparation for boarding, Kraitamchitkul was obliged to pass through a security checkpoint. For international travelers, this is located at the entrance to Pier G, the foreign departure concourse at SFO. The checkpoint consists in part of an X-ray machine used to scan passengers’ baggage. It is manned not by Customs agents, but by airport security guards, and is not a point at which one may obtain from or submit forms to Customs officials. The only Customs facility in the entire airport at that time was located at a substantial distance away from and — in the ordinary course of passenger transit — before the entrance to Pier G. There was no such facility beyond the security checkpoint.

Once having passed through the checkpoint, one may leave the concourse in only one of two ways: by doubling back through the checkpoint itself, or by boarding a flight.

Kraitamchitkul approached the security checkpoint and presented his carry-on bags for inspection. The X-ray examination disclosed the presence inside of several large dark masses. Following standard airport security policy designed to locate weapons or hazardous materials, the guards opened his baggage in order to identify the source of his obnubilation. This revealed a large amount of United States currency.

The security guards then called airport police; agents of Customs and of the Drug Enforcement Administration [DEA] were eventually summoned. Although not completely fluent in the language, Kraitamchit-kul conversed intelligently with the agents in English, and Customs Inspector John Martelli ascertained that he was scheduled to depart immediately for Hong Kong without having filed the required currency report pursuant to 31 U.S.C. § 5316(a). In response to questioning by Martelli about the money, Kraitamchitkul initially stated that the sum amounted to two hundred thousand dollars. Customs agents thereupon informed Kraitamchitkul of the requirement that he report to Customs any amount in excess of five thousand dollars being transported into or out of the United States. In order that the large quantity of cash could be counted in a less public arena, Kraitamchitkul voluntarily accompanied the agents to a nearby DEA station. There he admitted that he had not two hundred, but a total of eight hundred thousand dollars in his carry-on bags. A subsequent pat-down search disclosed an additional thirty-one thousand dollars on his person. In all, Kraitamchitkul was carrying with him the sum of $831,160.45.

Questioning by Customs agents elicited several statements. Kraitamchitkul first indicated that, while he was aware of the reporting requirement, he had not intended to comply with respect to the subject currency. He further informed the agents that he had entered this country the previous August 23 by way of Honolulu, Hawaii, when he claimed to have been carrying the currency’s value in gold. A computer check of government records revealed that Kraitamchitkul had not in fact filed the required currency report at the time of his entry into the United States. Kraitamchitkul was then arrested and the money in his possession seized.

Kraitamchitkul immediately contacted his attorney, Philip A. DeMassa, a claimant here. Late the same evening he wrote out in Thai an instrument purporting to assign three hundred thousand dollars of the seized currency to DeMassa, allegedly as consideration for the latter’s services in any prospective litigation arising out of the arrest and seizure.

Sunthorn Kraitamchitkul died on March 23, 1982, leaving as an additional claimant his widow, Valai. His death brought an end to criminal proceedings stemming from the alleged reporting violation upon his entry via Hawaii. Prior to his death, however, civil forfeiture proceedings were commenced on September 22, 1981, when the District Director of Customs in San Francisco issued a Notice of Seizure and Forfeiture. This notice advised Kraitamchitkul of his right to petition for administrative remission of the seized currency within sixty days, or to opt for prompt referral of the matter to the United States Attorney for initiation of judicial forfeiture proceedings. On October 26, 1981, DeMassa waived his client’s right to the latter option, requesting instead that the matter be handled administratively. At this time the money was being held as evidence in the pending criminal trial. By letter of the same date De-Massa further indicated that he did not want Kraitamchitkul interviewed until after conclusion of the criminal proceedings.

On the following November 5, Customs attorney Carl Cammarata notified DeMas-sa that, as counsel for Kraitamchitkul, he needed to submit a petition for remission on behalf of his client — and, if he so chose, on his own behalf as well — and that he could elect to await the end of the criminal trial before making the submission. No petition was submitted after receipt of this letter. On June 11, 1982, Cammarata wrote to notify DeMassa that the administrative forfeiture was proceeding and that, as the criminal case had recently been dismissed due to Kraitamehitkul’s death, a petition for remission should be submitted directly. On the following July 20, DeMas-sa submitted a “supplemental” petition, forty-one pages in length, containing numerous and varied allegations.

The case was extensively investigated over the next several months, and on January 7, 1983, the Secretary of the Treasury’s designee issued a decision denying the petition for remission. A January 21, 1983, letter from DeMassa demanding prompt referral to the United States Attorney for judicial forfeiture was received on January 24, and the subject forfeiture action was filed the following day.

Discussion

1 Claimants’ Motion for Summary Judgment

This motion is grounded on the theory that the government’s delay in filing its proceeding for judicial forfeiture violated claimants’ rights to due process of law.

The United States Supreme Court addressed virtually the identical claim in a factually similar situation in the recent case of United States v. Eight Thousand Eight Hundred and Fifty Dollars ($8,850) in United States Currency, 461 U.S. 555, 103 S.Ct. 2005, 76 L.Ed.2d 143 (1983) [$8,850], ruling that the appropriate test for determining whether delay in initiating judicial forfeiture proceedings constituted a due process violation was furnished by the earlier case of Barker v. Wingo, 407 U.S. 514, 92 S.Ct. 2182, 33 L.Ed.2d 101 (1972). The Barker tests requires the Court to assess and consider four factors:

(1) Length of delay;
(2) Reason for the delay;
(3) The [claimant’s] assertion of his right; and
(4) Prejudice to the [claimant].

Id., 407 U.S. at 530, 92 S.Ct. at 2192; $8,850, supra, 103 S.Ct. at 2012. Applying these factors, the Court in $8,850 determined that an eighteen month delay, although “quite significant,” id., did not violate due process. Id., 103 S.Ct. at 2015. Two aspects of the situation in $8,850 recommended themselves to the Court as permissible reasons for delay, i.e., the initiation and determination of a petition for remission, and the subsequent pendency of criminal proceedings. The Court endorsed the District Court’s perception that the government had proceeded with “all due speed,” id., 103 S.Ct. at 2014. Finally, the Court relied on the claimant’s failure to request initiation of judicial proceedings, and her failure to make a showing of prejudice to her ability to challenge the propriety of the forfeiture on the merits. Id.

In the present case the United States delayed approximately sixteen months before the commencement of judicial forfeiture proceedings. While shorter than the eighteen-month delay in $8,850, this period nonetheless appears quite substantial: the deprivation of funds over such a length of time, doubtless a significant burden to the rightful owner, must be well justified in order to survive a constitutional challenge. However, this first Barker factor — length of delay — is obviated in this case by a consideration of the second factor, the reason therefor.

The government has provided the Court with several convincing explanations for the filing delay in this case. The criminal proceeding in Honolulu, in which DeMassa vigorously defended Kraitamchitkul, was pending for the first nine of the sixteen months. Though the pendency of a criminal action does not in itself justify the delay, it is one factor among others which may be considered. $8,850, supra, 103 S.Ct. at 2013-2014. Depending on the outcome of the criminal case, the necessity of continuance of the civil proceedings could potentially have been nullified. This period of time, therefore, prejudiced neither the United States nor the claimants, in that the result of that trial might have eliminated the need for institution of the action now at bar. This possibility was, of course, mooted by Kraitamchitkul’s death during prosecution of the criminal case.

The pendency of that proceeding is significant for a second reason: during those nine months DeMassa refused to allow an interview of his client concerning the seizure. In order for the Secretary of the Treasure to properly exercise the discretion accorded him by, and yet be consistent with the spirit of the forfeiture provision, the government must determine, among other things, the source of the funds, the purpose in physically transporting them, their intended disposition, the reason for the failure to report them, and any involvement of the currency in illegal activity. Id., 103 S.Ct. at 2013-2014. The effective unavailability of Kraitamchitkul during the criminal proceeding could not but hobble the administrative forfeiture investigation, and a fortiori delayed institution of the concomitant civil action.

Even given this obstacle, the United States has presented uncontroverted affidavits attesting to its diligence in investigating this matter both during and subsequent to the criminal action. Inaugurated shortly after the September 4, 1981, arrest and seizure, the government’s inquiries reached points as far afield as Bangkok, Hong Kong, and the Grand Cayman Islands. Though a dispute exists as to whether the October 26, 1981, request for administrative forfeiture acted as a petition for remission, a formal petition spanning forty-one pages was submitted the following July. An administrative investigation is inherently time-consuming, id., 103 S.Ct. at 2014, and one examining so extensive a petition must necessarily involve a prolonged period of time. The government’s affidavits establish that the months following submission of the petition were spent in a thorough evaluation of the various allegations contained therein. Concurrent with this, the United States was further obliged to investigate a second petition submitted by the Kingdom of Thailand. There is no evidence to indicate that the government acted with other than due diligence in either investigation.

The third factor to be considered in the Barker analysis is the claimant’s assertion of his right to a judicial hearing. Claimants may generally trigger the rapid filing of a forfeiture action if such is their desire. All they need do is request referral of the matter to the United States Attorney for institution of such proceedings. In the instant case, however, claimant DeMassa waived such referral in writing, requesting instead that the case be handled administratively. There is no evidence that Valai Kraitamchitkul ever sought institution of judicial forfeiture. When DeMassa finally did request judicial forfeiture, the proceedings were commenced immediately. In light of this, the present assertion of unconstitutional delay in the filing of the judicial action is somewhat ironic.

The final Barker factor is whether the delay has resulted in prejudice to the claimant, ' chiefly with regard to his ability to present a defense on the merits. In this case, claimants have asserted as prejudice the sole fact that they have been denied access to the seized currency for an extended period of time. In view of this Court’s ruling that the United States was entitled to confiscate the subject currency, this argument is rendered moot, see discussion infra. In any event, they have not demonstrated that their ability to challenge forfeiture on the merits has been affected by the denial of access.

Thus, a review of the situation here in light of the Barker factors, as developed in $8,850, leads to the conclusion that the government’s delay in filing the judicial forfeiture action has not violated claimants’ due process rights. The length of the delay was substantial, but the United States diligently pursued an investigation of the matter throughout that period; the delay occurred in part because, at counsel’s request, the government postponed interviewing Kraitamchitkul; claimants initially waived the right to have the judicial forfeiture proceed expeditiously, thereby accounting for at least a significant measure of delay; and there has been no showing of prejudice to claimants as a result of the delay. It is therefore the Court’s opinion that claimants’ motion for summary judgment must be denied.

2 Government’s Motion for Summary Judgment

The government’s second cause of action alleges that Sunthorn Kraitamchitkul attempted to transport the subject currency out of the United States without filing a customs report, a violation of 31 U.S.C. § 5316(a) [formerly § 1101(a)], which provides in pertinent part that

(a) ... a person ... shall file a report under subsection (b) of this section when the person ...
(1) transports or has transported monetary instruments of more than $5,000 at one time—
(A) from a place in the United States to or through a place outside the United States....

Id. The statute further provides that the subject reports shall be filed “at such time and place ... as the Secretary of the Treasury may require.” Id. at § 5316(b). The civil penalty for failure to comply with § 5316 is detailed in 31 U.S.C. § 5317(b), which specifically provides:

(b) A monetary instrument being transported may be seized and forfeited to the United States Government when a report on the instrument under section 5316 of this title has not been filed....

These two sections provide the statutory authority upon which the government bases the instant motion for summary judgment of forfeiture.

In opposition to forfeiture, claimants set forth two arguments. These will be discussed serially.

(A) “Time of Departure”

Claimants’ initial contention is that Krai-tamchitkul had not progressed far enough toward departure to violate § 5316. Seizure and forfeiture of the currency at the security checkpoint was improper, they argue, because Kraitamchitkul could have complied with the statutory scheme by reporting the currency after passing through the checkpoint.

The central question here is whether Kraitamchitkul had physically proceeded far enough in his attempt to remove the currency from this country to trigger the reporting requirements of § 5316. The relevant regulation interpreting this section provides that the point of filing the report is “the time of departure from the United States.” 31 C.F.R. § 103.25(b). The few cases which have construed the operative, yet admittedly ambiguous phrase “time of departure” are consistent in their endorsement of the proposition that this point may be reached well before one actually crosses the international border, and even before taking a seat on an aircraft destined for a foreign port. See United States v. Gomez-Londono, 553 F.2d 805 (2d Cir.1977); United States v. Cutaia, 511 F.Supp. 619, 624-625 (E.D.N.Y.1982). No set rule has emerged, however, for divining at what precise physical point in the departure process the nascent duty to report matures; this has been evaluated on a case-by-case basis.

In United States v. Rojas, 671 F.2d 159, 163 (5th Cir.1982), the Court held that the “time of departure” had been reached when, the flight having been called for boarding, the defendant stepped onto the jetport preparing to board the plane. Fearing that it might engender myriad enforcement problems, the Fifth Circuit refused to fix as the “time of departure” a latter point in time. To construe this phrase as meaning the actual boarding of the aircraft, the Court stated, “would require having a customs officer on board every international flight departing the United States.... ” Id., 671 F.2d at 163. On the other hand, the Court declined equally to overrule the possibility that an earlier stage of the departure process might in some instances represent the critical point. Id., citing United States v. Gomez-Londono, supra, 553 F.2d 805, 810. Rather, the Court indicated that the “time of departure” is when one “unequivocally manifests] an intention to leave the United States.... ” Rojas, supra, 671 F.2d at 163.

In United States v. Cutaia, supra, the District Court for the Eastern District of New York phrased the test somewhat differently. In that case the Court held that the critical point was attained when defendants had checked their baggage, obtained their boarding passes, and were sitting in the departure area awaiting takeoff an hour hence: all that remained was for them to walk through the departure gate and present tickets and boarding passes. In reaching this determination, the Court defined the “time of departure” as that time reasonably close to the moment of the carrier’s actual departure when the passenger has manifested a definite commitment to leave the country.... Id., 511 F.Supp. at 625. The Ninth Circuit has cited this case with approval, United States v. Duncan, 693 F.2d 971 (9th Cir.1982), and the Second Circuit has implicitly applied a similar test. Gomez-Londono, supra. The general principle which may be gleaned from these cases is that the “time of departure” from the country is reached when one is reasonably close, both spatially and temporally, to the physical point of departure itself, and manifests a definite commitment to leave.

Considering the instant situation in light of this principle, the Court determines that Kraitamchitkul reached the “time of departure” without properly filing a currency report. This conclusion is based on the uncontroverted facts that he arrived at the last security checkpoint in advance of his departure gate without exhibiting the least intention to comply tlvith the reporting requirement (of which he subsequently indicated he was indeed aware); that he arrived there approximately one hour before his scheduled flight; and that he had previously registered for the flight, checked his baggage, and received his boarding pass— all that thus remained for him to do was to walk to the gate, present his pass, and board the aircraft. Therefore, when Krai-tamchitkul approached the security checkpoint shortly before the flight he satisfied the requirements of proximity in space and time and this — in conjunction with his seeming determination to leave the United States — situated him at the “time of departure.” Inasmuch as he reached this point without having filed a currency report, the Court concludes that Kraitamchitkul violated 31 U.S.C. § 5316.

(B) Kraitamchitkul’s Actual Knowledge of the Reporting Requirement

Claimants’ other argument is that scien-ter is an element which must be established in a civil forfeiture proceeding under § 5317, and that because Kraitamchitkul was unaware of the reporting requirement the government’s motion should be denied. This argument is both factually and legally unmeritorious. Based on affidavits submitted by the United States, the Court is satisfied that Kraitamchitkul was conversant in English and that he stated to agents in that language that he indeed knew of the currency reporting requirement. While claimants’ opposing affidavits impugn Kraitamchitkul’s fluency they are insufficient to disturb the Court’s finding: it was unnecessary for Kraitamchitkul to have been endowed with a flawless command of idiomatic English in order to acknowledge his awareness of the relevant Customs requirements.

The Court makes the further determination that scienter is not, as claimants contend, an essential element of a civil forfeiture proceeding. The term “knowingly” in § 5316 refers only to the knowing transportation of currency, not to specific knowledge of the reporting requirements. United States v. $4,255,625.29, 528 F.Supp. 969, 971-972 (S.D.Fla.1981); see also One Lot Emerald Cut Stones and One Ring v. United States, 409 U.S. 232, 234, 93 S.Ct. 489, 492, 34 L.Ed.2d 438 (1972) (forfeiture action under a similar statute, 19 U.S.C. § 1497, required no proof of knowledge of reporting requirement.) Claimants’ theory must therefore be rejected. Since scienter is not required, what Kraitamchitkul actually knew of the Customs requirement is irrelevant. Even were the theory advanced by claimants accepted, that he did know of the requirement indicates with even greater force the existence of a violation of § 5316.

In accordance with the above discussion, the Court has determined that summary judgment on the second cause of action must be granted in favor of the United States.

Conclusion

In consideration of the foregoing, and for good cause shown, the currency is hereby adjudged forfeited.

SO ORDERED.

      . The Cutaia definition also includes elements of knowledge of the filing requirement and an intention not to comply. Cutaia is a criminal case, however, and as discussed below knowledge and intent are not elements essential to a civil forfeiture action under § 5316.

      . Given this disposition, the Court need not rule on the question of the validity of the assignment to DeMassa.


author: KANE, District Judge.

text:
    TAVERN TALENT, International Entertainment Consultants, Inc., and MJL, Inc., Plaintiffs, v. Alan CHARNES, in his official capacity as Executive Director of the Colorado Department of Revenue, Defendant.
    Civ. A. No. 84-K-2050.
    United States District Court, D. Colorado.
    May 6, 1985.
    Dennis W. Hartley, Hartley, Obernesser, Vagilica, Bailey & Robinson, Colorado Springs, Colo., for plaintiffs.
    Robert L. Patterson, Asst. Atty. Gen., Denver, Colo., for defendant.
   ORDER OF DISMISSAL

KANE, District Judge.

Jurisdiction is asserted on the basis of 28 U.S.C. § 1331 which grants original jurisdiction of all civil actions arising under the Constitution, laws or treaties of the United States to the district courts.

The plaintiffs are purveyors of exotic dancers. Their respective businesses of supplying, consulting and providing exotic dancers have bottomed out, so to speak, because of the defendant revenue director’s insistence on enforcing a Colorado Code of Regulation provision which prohibits establishments that serve alcoholic beverages from permitting employees to appear in the nude or in such state of dress that certain enumerated portions of the anatomy are exposed to view. The plaintiffs opine that the adamantine enforcement of this regulation puts unnecessary fringes on the freedom of employees to express themselves; that such expression is enshrouded in the protective veil of the First Amendment cannot be doubted.

The defendant’s view of the plaintiffs’ position is girdled by procedural objections to plaintiffs’ standing and their failure to exhaust remedies provided by the state for review of the enforcement of the regulation. The plaintiffs claim that they are being deprived of revenue which would otherwise be theirs if live, nude dancing were permitted in licensed premises. I find that plaintiffs do have standing by virtue of their claimed economic “injury in fact.” See, e.g., Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970).

Because the Supreme Court of Colorado has already ruled that the very same regulation which is subject to such stripping analysis in this case does not violate the First Amendment, the exhaustion of remedies requirement is obviated. See Citizens for Free Enterprise v. Department of Revenue, 649 P.2d 1054 (Colo.1982).

Meatier matters concern us, however, when directing our attention right to the nub of the controversy. In California v. LaRue, 409 U.S. 109, 93 S.Ct. 390, 34 L.Ed.2d 342 (1972), the United States Supreme Court upheld the constitutionality of a California provision which is identical to the Colorado regulation. Although I get nervous when anyone starts to fondle the First Amendment, it is recognized by our highest court that the Twenty-First Amendment confers more than usual police power on the states, including the right to prohibit activity in liquor licensed establishments which would otherwise be deemed protected activity under the blanket of the First Amendment. In other words, the defendant has full authority to abjure callipygian exposition in establishments subject to his regulation.

For these reasons, the motion to dismiss is granted. The case is dismissed. Each party shall bear his or its own costs.

      . The ecdysiasts are not themselves before the court. Were they to be, another question would be addressed, viz,, Whether the application of the regulation is overly broad. I think not since the dancers are free to express themselves in places other than licensed premises. Such a matter is more a question of geography than choreography.


author: SPRIZZO, District Judge:

text:
    CITY OF YONKERS and Yonkers Community Development Agency, Plaintiffs, v. OTIS ELEVATOR COMPANY and United Technologies Corporation, Defendants.
    No. 83 Civ. 5944 (JES).
    United States District Court, S.D. New York.
    May 6, 1985.

      Vito J. Cassan, Attorney for Plaintiffs New York City, for plaintiffs; John D. Calamari, Joseph M. Perillo, Peter M. Levine, New York City, of counsel.
    Waehtell, Lipton, Rosen & Katz, New York City, for defendants; Robert B. Ma-zur, Barry A. Weprin, New York City, of counsel.
   OPINION & ORDER

SPRIZZO, District Judge:

Defendants move for summary judgment against plaintiffs, raising an assortment of defenses including among others the New York Statute of Frauds, N.Y. Gen.Obl.Law § 5-701(a)(l). The contract alleged in the complaint, requires defendant Otis Elevator Company to stay in Yonkers for a reasonable period, but not less than sixty years. See Complaint, ¶ 24 (“The period of time for performance by Otis and United of these obligations due to Yonkers and the Development Agency is for a reasonable time to be set by law, and is alleged to be at least sixty years.”). That contract, therefore, by its terms cannot be performed within a year.

The Court has been directed to no memo-randa signed or prepared by the defendants even arguably sufficient to satisfy the statute of frauds with respect to that agreement, although the Court has been provided with an extensive amount of documentation with respect to defendants’ motion. It follows that the complaint, as presently drafted, must be dismissed and the defendants’ motion must be granted.

There has, however, been some confusion as to exactly what the plaintiffs now contend the contract to be. Both in the papers, and especially on oral argument of the motions, counsel for the plaintiffs maintained that the contract was for a reasonable time, that its duration was indefinite and that the Court could determine its length through appropriate proof.

The vague and elusive nature of these claims makes it difficult, if not impossible, for the Court to adequately assess the sufficiency of the defenses made and the applicability of the parol evidence rule. There also seems to be some confusion as to what plaintiffs presently claim the precise terms and obligations of the alleged contract are. Therefore, in the interest of justice and to afford the plaintiffs the opportunity to clarify these issues in a new pleading, the Court directs that the dismissal of the plaintiffs’ complaint be without prejudice.

The plaintiffs shall file an amended complaint on or before June 18, 1985, specifying the nature of the contract which they claim to exist, the terms and obligations of each party thereunder, whether that contract was oral or written, and its alleged duration. The defendants shall then file a motion to dismiss and/or for summary judgment on or before July 18, 1985; the plaintiffs shall respond to that motion on or before August 19, 1985; the defendants shall reply on or before October 1, 1985, and a Pre-Trial Conference shall be held on January 17, 1986 at 10:00 A.M. Plaintiffs’ cross-motion for partial summary judgment is denied.

It is SO ORDERED.

      . The Court is not persuaded by plaintiffs' argument that the contract could have been performed within a year. What a contract is turns upon the expressed intent of the parties and here, if the allegations of the complaint are taken as true, the plaintiffs claim that the parties intended that the agreement would last for at least sixty years. The plaintiffs may not urge a theory of the contract for purposes of resisting a defense based upon the statute of frauds that is inconsistent with what the plaintiffs allege the contract to be in the complaint. Cf. Ginsberg Machine Co. v. J & H Label Processing Corp., 341 F.2d 825, 827 (2d Cir.1965) ("By the very terms plaintiff attributes to the agreement, it is not to be performed within one year of the making thereof and thus it falls within the New York statute of frauds....”).
      This is especially true where, as here, if this contract were one that could be performed within a year, there might well be no breach as a matter of law. It is undisputed that Otis has remained in Yonkers for more than a year since the contract was allegedly made. In fact, at oral argument counsel for the parties indicated that defendants have not yet totally left Yonkers.

      . There has been a suggestion throughout this litigation that the plaintiffs' action has been brought for political reasons, and for a vindictive purpose. See, e.g., Affidavit of Robert B. Mazur In Support of Defendants’ Motion for Summary Judgment, Exhibits A-I. The Court cannot presently assess the merits of that contention, although the shifting contours of plaintiffs' contractual assertions and the overall history of the case may lend this suggestion some credence. As one additional example, the Court notes that plaintiffs did not withdraw their fraud claim until after defendants had filed and served this summary judgment motion. Suffice it to say that if the Court later concludes that the action was brought in bad faith, the Court will not hesitate to impose whatever sanctions are appropriate under Rule 11.


author: WARRINER, District Judge.

text:
    Tilly AGUIAR v. Thomas R. EVANS, et al.
    Civ. A. No. 85-0253-R.
    United States District Court, E.D. Virginia, Richmond Division.
    May 6, 1985.
    Donna J. Katos, Bremner, Baber & Janus, Richmond, Va., for plaintiff.
    Harrison Bush, Richmond, Va., Cecelia T. Roudiez, Washington, D.C., for defendants.
   OPINION

WARRINER, District Judge.

Presently before the Court is plaintiff’s petition, filed with this Court on 27 March 1985, to remand this action to the State court. Defendants have filed a brief in opposition to remand. Plaintiff did not file a rebuttal. The matter is ripe for adjudication.

On 7 February 1985 plaintjff filed this action in the Circuit Court for the County of Henrico. On' 8 March 1985 defendant Chesapeake & Potomac Telephone Co. (C & P), pursuant to 28 U.S.C. § 1441, filed a petition for removal to this Court.

Contained in the petition was an allegation that jurisdiction in this action is based on a federal question and that the ease is brought under the Labor Management Relations Act, § 29 U.S.C. § 185.

Accepting defendant C & P’s allegation of jurisdiction as being true, this matter nevertheless must be remanded to the State court.

Section 1441(a) provides:

Except as otherwise expressly provided by Act of Congress, any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending.

28 U.S.C. § 1446 prescribes the procedures to be followed for removal. Section 1446(a) provides:

A defendant or defendants desiring to remove any civil action or criminal prosecution from a State court shall file in the district court of the United States for the district and division within which such action is pending a verified petition containing a short and plain statement of the facts which entitle him or them to removal together with a copy of all process, pleadings and orders served upon him or them in such action.
(b) The petition for removal of a civil action or proceeding shall be filed within thirty days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within thirty days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter. Section 1447(c) provides:
If at any time before final judgment it appears that the case was removed improvidently and without jurisdiction, the district court shall remand the ease, and may order the payment of just cost....

Both §§ 1441(a) and 1446(a) make reference to “defendant or defendants.” Cases interpreting that phrase “have uniformly interpreted these statutes as requiring that when there is more than one defendant in the State court action all the defendants must be joined or consent to the removal petition.” A.E. Staley Manufacturing Co. v. Fischback & Moore, Inc., 353 F.Supp. 578, 581 (E.D.Pa.1973) and the cases cited therein. See generally Baldwin v. Perdue, Inc., 451 F.Supp. 373 (E.D.Va.1978).

That all defendants, in a suit based on diversity jurisdiction, must join the petition for removal within thirty days is unquestioned. See, e.g., P.P. Farmers’ Elevator Co. v. Farmers Elevator Mutual Insurance Co., 395 F.2d 546, 547 (7th Cir.1968); Bradley v. Maryland Casualty Co., 382 F.2d 415, 419 (8th Cir.1967); Baldwin, 451 F.Supp. at 376; Orlikowski v. Mearns, 212 F.Supp. 37, 38-39 (E.D.Va.1962).

That the joining of all defendants in a federal question jurisdiction case has never been so clearly stated in any of the decisions I have researched. The removal statutes themselves, in requiring defendants to join in the petition for removal, make no distinction between cases based on diversity jurisdiction as opposed to federal question jurisdiction. Nor do Professors Wright, Miller and Cooper in their discussion of removal procedures distinguish between the defendants required to join in the petition when it is based on diversity or a federal question. See Wright, Miller and Cooper, Federal Practice and Procedure § 3731.

Professor Moore in discussing federal question removal procedures states “[a]s the statute treats plural defendants collectively, all must normally join in the removal petition.” See Moore’s Federal Practice ¶ 0.160[6] & n. 1. Yet, the cases cited therein do not stand for that specific proposition. See, e.g., id. (citing Bradley v. Maryland Casualty Co., 382 F.2d 415 (8th Cir.1967) (removal on diversity grounds); P.P. Farmers’ Elevator Co. v. Farmers Elevator Mutual Insurance Co., 395 F.2d 546 (7th Cir.1968) (removal on diversity grounds); Johnson v. General Motors Corp., 242 F.Supp. 778 (E.D.Va.1965) (removal on diversity grounds); Nowell v. Nowell, 272 F.Supp. 298 (D.Conn.1967) (removal on diversity grounds).

In the case at bar only defendant C & P filed a petition and only defendant C & P presented the bond required under 28 U.S.C. § 1446(d).

“Removal statutes are strictly construed.” Thompson v. Gillen, 491 F.Supp. 24, 26 (E.D.Va.1980) (citations omitted). See also Richmond, Fredericksburg & Potomac Railway Co. v. Intermodal Services, Inc., 508 F.Supp. 804 (E.D.Va.1981); Winters Government Securities Corp. v. Cedar Point State Bank, 446 F.Supp. 1123 (S.D.Fla.1978).

Because removal statutes are to be strictly construed, because the removal statutes do not distinguish between cases based on federal question or diversity jurisdiction, and because the cases have uniformly held that all defendants must join in the removal petition, I determine that all defendants must join in the petition to remove a ease to the federal court when jurisdiction is based on a federal question.

Because all defendants failed to petition for removal within the thirty day period required under the removal statutes, this action must be remanded to the State court pursuant to 28 U.S.C. § 1447(c).

And it is so ORDERED.

JUDGMENT

For the reasons set forth in the accompanying opinion this action is REMANDED to the Circuit Court for the County of Henri-co, Virginia.

And it is so ORDERED.


author: TELESCA, District Judge.

text:
    Christopher BREADS, Plaintiff, v. Ray ELLIS, Defendant.
    No. Civ-85-489T.
    United States District Court, W.D. New York.
    May 8, 1985.

      Christopher Breads, pro se.
   DECISION AND ORDER

TELESCA, District Judge.

Plaintiff, Christopher Breads, has instituted this civil rights action pursuant to 42 U.S.C. Section 1983 against Ray Ellis, a Deputy Sheriff for Livingston County, and has requested permission to proceed in for-ma pauperis. 28 U.S.C. Section 1915.

According to the complaint, plaintiff was arrested by the defendant less than three (3) months ago, on February 12, 1985, and is presently still in custody. Plaintiff alleges that he was not informed of his Miranda rights before he was coerced into making several incriminating statements. The complaint seeks only equitable relief, and asks this Court to dismiss the charges pending against the plaintiff in the Livingston County Courts.

It is .now settled that the federal anti-injunction statute, 28 U.S.C. Section 2283, does not absolutely foreclose a federal court in a Section 1983 suit from granting an injunction to stay a proceeding pending in a state court. Mitchum v. Foster, 407 U.S. 225, 92 S.Ct. 2151, 32 L.Ed.2d 705 (1972). In so concluding, however, Mitch-um did “not question or qualify in any way the principles of equity, comity, and federalism that must restrain a federal court wben asked to enjoin a state court proceeding”. Id., at 243, 92 S.Ct. at 2162. The Supreme Court has repeatedly stated that, “In view of the fundamental policy against federal interference with state criminal prosecutions”, such injunctive relief may only be obtained to avoid irreparable injury which is “both great and immediate”. Younger v. Harris, 401 U.S. 37, 46, 91 S.Ct. 746, 751, 27 L.Ed.2d 669 (1971).

It is clear that the allegations of plaintiffs complaint, liberally construed in his favor, could not possibly establish the irreparable injury required for federal in-junctive relief from his pending state criminal proceedings. As the Supreme Court has stated,

Certain types of injury, in particular, the cost, anxiety, and inconvenience of having to defend against a single criminal prosecution, could not by themselves be considered “irreparable” in the special legal sense of that term. Instead, the threat to the plaintiffs federally protected rights must be one that cannot be eliminated by his defense against a single criminal prosecution.

Younger, supra, 401 U.S. at 46, 91 S.Ct. at 751.

Accordingly, I must conclude that the allegations of plaintiffs complaint cannot establish the sort of irreparable injury required for federal injunctive relief. Plaintiff may (and should) raise his federal constitutional claims in his .defense in the state courts, before seeking federal equitable relief. As the Supreme Court has repeatedly emphasized, “nothing we have said would permit the derailment of a pending state proceeding by an attempt to litigate constitutional defenses prematurely in federal court”. Braden v. 30th Judicial Circuit Court of Kentucky, 410 U.S. 484, 493, 93 S.Ct. 1123, 1129, 35 L.Ed.2d 443 (1973); see also, United States, ex rel. Scranton v. State of New York, 532 F.2d 292 (2d Cir.1976).

This Court is empowered by 28 U.S.C. Section 1915(d) to dismiss sua sponte a pro se civil rights complaint which, when liberally construed, is conclusively foreclosed by statute or controlling precedent. Cameron v. Fogarty, 705 F.2d 676, 678 (2d Cir.1983). Such is the case here, and plaintiffs complaint is therefore dismissed.

SO ORDERED.

      . Although Braden involved the exhaustion requirement for federal habeas corpus relief, that doctrine has its roots in the same concerns for federalism which dictate my decision in this case.