text:
    James CHERRY; Tom Leake; Dana S. Roberts; Andy Wilkins; Clarence Ward; Curtis Adams; Henry Aikens; Michael Garvey; and all others similarly situated, Plaintiffs, v. ROCKDALE COUNTY; David Farmer, Chief Jailer, Rockdale County Jail, Defendants.
    Civ. A. No. C83-1466A.
    United States District Court, N.D. Georgia, Atlanta Division.
    Dec. 20, 1984.

      Ralph Goldberg, Atlanta, Ga., Bensonetta Tipton Lane, College Park, Ga., for plaintiffs.
    Sidney L. Nation, Conyers, Ga., Marion O. Gordon, John C. Walden, Sr. Asst. Attys. Gen., William Davis Hewitt, Staff Asst. Atty. Gen., and Michael J. Bowers, Atty. Gen., Atlanta, Ga., for defendants.
   ORDER OF THE COURT

FORRESTER, District Judge.

This civil rights case challenging the conditions of confinement at the Rockdale County Jail is before the court for determination of attorney’s fees. For the reasons set out below, the court feels that it is not in a position to rule on the application and gives leave to the parties to amend their petitions.

Counsel for the plaintiffs have submitted a very detailed itemization of time spent and have submitted a very helpful brief in support of their application. The papers are deficient in only two regards. First, the application does not clearly set out enough information on the results obtained. The court is fairly certain that plaintiffs did not prevail on each and every claim raised in the original complaint. Second, the application asks for an enhancement of any award on account of the fact that the fee arrangement that counsel had with their clients was contingent.

Both under Johnson v. Georgia Highway Express, Inc., 488 F.2d 714 (5th Cir.1974) and also under Hensley v. Eckerhart, 461 U.S. 424, 103 S.Ct. 1933, 76 L.Ed.2d 40 (1983), the court must take into account the results obtained in calculating the appropriate fee award under 42 U.S.C. § 1988. It is clear from Hensley that the court should not generally award fees for work done on unsuccessful claims. Plaintiffs have made no effort that the court can discern to prorate the time spent between the successful and unsuccessful claims. Such pro ration should be addressed by plaintiffs’ counsel in their supplemental petition.

Further, as suggested above, the plaintiffs’ counsel are entitled to fees only for what was achieved by their work. Rock-dale County contends that some of the changes that are now being made and some of the things that they agreed to in the consent order were in the planning stages or underway before suit was filed. This averment in Rockdale County’s pleadings is not, however, supported by affidavit, deposition, or otherwise as is required by the Local Rules of the Court. If the County wishes the court to take those allegations seriously, it should in a supplemental response document its factual contentions.

The plaintiffs’ counsel also seek a 50% enhancement of any fee awarded. It seems clear to the court that this is not one of those “rare” cases which deserves enhancement because the quality of service rendered was superior to that one reasonably should expect in light of the hourly rate charged or because the success obtained was exceptional. Blum v. Stenson, — U.S. -, 104 S.Ct. 1541, 79 L.Ed.2d 891 (1984). Accordingly, the only cogent reason argued by the plaintiffs’ counsel for enhancement is the contingent nature of the fee. Several courts have suggested that this is a basis for enhancement. E.g., Johnson, supra; Jones v. Diamond, 636 F.2d 1364 (5th Cir.1981).

Contingent fee arrangements have a legitimate place in our society. The object of contingent fee arrangements (whether the fee comes out of the award or from the opposing party) is to make lawyers available in sufficient number so as to guarantee meaningful access to the courts for citizens who are in genuine need of legal assistance who cannot pay legal fees in advance or as they are incurred. It seems to the court that the plaintiffs’ civil rights bar is probably almost solely dependent on such fee arrangements. If their natural constituency is to have representation, the financial rewards must be sufficient to attract capable attorneys into that field. It seems to the court, however, that, like justifying an upward adjustment based on the quality of service rendered or the results obtained, such an award can only be made on the basis of specific evidence. Blum, supra, 104 S.Ct. at 1549. As Justice Powell noted in Blum, the legislative history of 42 U.S.C. § 1988 explains that Congress intended a reasonable fee which would attract competent counsel but not produce a windfall to attorneys. Blum, supra, 104 S.Ct. at 1548.

It is often said that the reason for a contingent fee enhancement factor is that the lawyer with such an arrangement is taking the risk that all of his efforts might come to naught. Of course, a free economy does compensate a risk-taker. The court suggests, however, that at least for these purposes an enhancement is justified only if it is needed to get overall compensation of attorneys representing the affected class to a sufficient level to attract capable advocates. Since there is no evidence before the court on what that level might be, the court does not believe that there is a sufficient evidentiary basis to assume that enhancement is necessary.

The court realizes that some other judges have used multipliers as high as three and four times the hourly rate found reasonable by the court. It is the court’s opinion that such figures are absolutely without rational quantifiable foundation.

By way of illustration only, consider the following. Mr. Goldberg, one of plaintiffs’ counsel, was admitted to practice in 1975 and Ms. Lane, the other plaintiffs’ counsel, was admitted in 1976. According to a national survey proffered to the court in another case, if these two attorneys were compensated at the upper quartile rate paid partners admitted to practice in the same years, they would earn respectively $89,800 and $77,800 per annum. If each was compensated at the upper quartile rate for associates with similar seniority, they would earn, respectively, $61,300 and $56,-800 per annum. These rates, presumably, are sufficient to attract capable attorneys. The same survey would suggest that practitioners in small firms have an average overhead of about $47,000 per attorney. A reasonably diligent attorney has available about 2,000 hours per year to do fee-producing work (50 weeks times 40 hours per week).

Affidavits offered by plaintiffs suggest that $100 per hour is a reasonable hourly rate for these attorneys. The table below illustrates the annualized income for an attorney based on different enhancement presumptions. The incomes are shown as a function of a one-third and one-half loss rate. The loss rate assumes that because of the vagaries of the practice, the attorney will be unsuccessful in obtaining compensation for one-third or one-half of his potential billable hours.

ANNUALIZED INCOME BASED ON DIFFERENT RATES OF ENHANCEMENT AND DIFFERENT RATES OF SUCCESS ASSUMING A RATE OF $100 PER HOUR

Potential No 50% 100% Enhancement Enhancement

Hours Lost Enhancement Enhancement Enhancement Multiple x 3 Multiple X 4

1/3 Loss Rate $85,000 $151,000 $217,000 $349,000 $481,000

1/2 Loss Rate $53,000 $103,000 $153,000 $253,000 $353,000

From this chart it can be seen that if the loss rate for the average capable civil rights lawyer is one-third of his potential billable hours, then his annualized income based on a rate of $100 per hour would be in line with the earnings of the top 25% of the lawyers with years of experience similar to that of plaintiffs’ counsel. If, on the other hand, the loss rate was higher, then some enhancement might be needed if counsel were a partner and not an associate. Under either loss rate assumption, a 50% enhancement begins being a windfall, and an enhancement at the four multiple rate might very well produce a shift in legal specialties which might be visually akin to the California gold rush.

The court does not mean to suggest any more by the above analysis than that the question of whether to enhance because of the contingent nature of the fee and if so, how much, cannot be fairly decided by a court’s merely taking a stab in the dark. The court understands that it might not have thought of all of the factors which come into play, and it realizes that there is no evidentiary basis for its assumption that a loss rate of between one-third and one-half is a reasonable expectation for capable attorneys. Further, the statistics relied on, of course, are not in evidence in this case, and neither side has had an opportunity to validate them. The court does mean to suggest, however, that absent some data which will put quantifiable parameters on enhancement multiples, the court will not grant any enhancement.

In addition to a request for attorney’s fees, plaintiffs’ counsel seek to recover costs for secretarial services, photocopying, postage and long distance telephone calls. The law in this circuit is that a civil rights attorney may obtain all costs and expenses with the exception of routine office overhead normally absorbed by the practicing attorney. Dowdell v. City Apopka, 698 F.2d 1181 (11th Cir.1983). It is not clear to the court that expenses of the types just listed should not be routinely absorbed in office overhead. Dowdell, supra, seems to assume that such costs are recoverable. Id. at 1191. The Dowdell court relies for that proposition on Miller v. Carson, 628 F.2d 346 (5th Cir.1980), where that panel found no abuse of discretion in the district court’s awarding expenses for such items. The decision in part relies upon the case of Cole v. Tuttle, 462 F.Supp. 1016 (N.D.Miss.1978). Contrary to the findings in the two appellate decisions which trace their origin to the district court decision, Judge Smith did not allow the plaintiff to recover for postage, clerical, or typing services or certain reproduction costs because the judge considered these to be overhead in the operation of a law office.

Actually, it seems to this court that the recoverability of these items ought to be determined more by reference to fact than to precedent. Plaintiffs rely upon customary fees in the area to establish a prevailing rate for an award of attorney’s fees. The attorney’s fee award in every case obviously anticipates that the attorney will have to pay for some overhead out of the award. It seems to the court that counsel for the plaintiffs are obliged to demonstrate whether the attorneys whose fees are being relied upon separately bill their clients for the kinds of things for which recovery is sought before such expenses may be recovered. Otherwise, there is a possibility that plaintiffs could obtain double recovery of costs.

Conclusion

Both parties are permitted thirty (30) days in which to file supplemental pleadings addressing the concerns raised in this order. Both parties will be allowed fifteen (15) days in which to reply to any supplement filed by the opposing party. Thereafter, the Clerk shall promptly resubmit the matter for decision by the court.

      . The affidavits are supplied by two attorneys whose principal practice may be plaintiffs’ work. It may be, therefore, that the rates quoted are adjusted, consciously or unconsciously, for the contingent nature of fee recovery in other work. A better bench mark might be the fees customarily charged by lawyers of equal experience who principally work on hourly rates and have good collection rates.


source: Caselaw Access Project

author: FORRESTER, District Judge.

license: Public Domain

text:
    UNITED STATES of America v. Ardis Lorraine BEESLEY, James Austin Beesley.
    Crim. No. CR84-368A.
    United States District Court, N.D. Georgia, Atlanta Division.
    Dec. 21, 1984.
    Larry Thompson, U.S. Atty., Anthony L. Cochran, Asst. U.S. Atty., Atlanta, Ga., for plaintiff.
    Mary Donovan, Federal Defender Program, Inc., Atlanta, Ga., for defendants.
   ORDER

FORRESTER, District Judge.

This case is pending before the court on defendant’s motion, pursuant to 18 U.S.C. § 3145(b) (amended October 12, 1984) for review of an order of United States Magistrate Harper which ordered defendant detained pending trial pursuant to 18 U.S.C. § 3142(e) (amended October 12, 1984). The threshold question before this court is what standard of review is to be applied to Magistrate Harper’s order. The government has argued that that order is subject to review only under the clearly erroneous standard. The basis for this allegation is the government’s argument that the recent amendment by Congress, in the Comprehensive Crime Control Act of 1984, Public Law No. 98-473, of 28 U.S.C. § 636(a)(2) has changed the standards for review. Section 636(a)(2) formerly provided that magistrates had the general power to “impose conditions of release under section 3146 of Title 18.” The new amendment provides that magistrates shall have jurisdiction to “issue orders pursuant to section 3142 of Title 18 concerning release or detention of persons pending trial.” However, the clearly erroneous standard of review found in section 636 applies only to matters decided under section 636(b)(1)(A), so an amendment to section 636(a) should have no effect on the standard of review. Section 636(b)(1)(A) provides that magistrates may hear any pretrial matter, with certain enumerated exceptions, and that when a magistrate does so reconsideration by the district court is subject to the clearly erroneous standard. 28 U.S.C. § 636(b)(1)(A). Congress, in amending subsection (a) of section 636 did not include any language from which this court could infer that Congress intended to engraft a clearly erroneous standard of review onto magistrates’ decisions made under that provision. Rather, the amendment by Congress to section 636(a)(2) was apparently designed, to make the language of that statute conform to the new provisions found in the Bail Reform Act of 1984. The court therefore concludes that nothing in the amendment by Congress, codified as the Bail Reform Act of 1984, changed the standard of review of magistrates’ determinations regarding pretrial release. The clearly erroneous standard of review applies only to matters decided by magistrates under subsection (b) of section 636, not to matters decided under subsection (a) of section 636.

The question then becomes what is the appropriate standard of review. 18 U.S.C. § 3145(b) of the new Bail Reform Act provides that:

If a person is ordered detained by a magistrate, or by a person other than a judge of a court having original jurisdiction over the offense and other than a Federal appellate court, the person may file, with the court having original jurisdiction over the offense, a motion for revocation or amendment of the order. The motion shall be determined promptly-

Since this court has determined that the new Bail Reform Act provides no statutory guidance as to the appropriate standard of review to be applied by the district court in this situation, the court considers itself constrained to apply the standards which have developed under the cases decided prior to the Bail Reform Act of 1984. The court finds particularly persuasive the decision of the Fifth Circuit in United States vs. Thibodeaux, 663 F.2d 520 (5th Cir.1981). This case, which constitutes persuasive rather than binding authority, explains that the appropriate standard by which a district court should review a magistrate’s denial of bail is one of discretion which is “as unfettered as it would be if the district court were considering whether to amend its own action.” 663 F.2d at 522. Indeed, the court held that it was the responsibility of the district court to reconsider the magistrate’s decision fully, and not feel constrained by an abuse of discretion standard or a standard of deferring to the judgment of the magistrate. Id.

In reviewing Magistrate Harper’s decision as if this court had been asked to amend a decision of its own, the court notes that although there was evidence to support Magistrate Harper’s decision, it was not clear and convincing. 18 U.S.C. § 3142(e) (as amended) provides that detention is appropriate only where the court finds that no condition or combination of conditions will reasonably assure the appearance of the person as required and the safety of any other person or the community. This court believes something short of confinement in a jail-type institution will be sufficient to insure this defendant’s presence at any trial of this case, pursuant to 18 U.S.C. § 3142(c). In particular, the court believes that the combination of the factors of the defendant’s age, her lack of resources, her lack of prior record, and, especially, the fact that her partner in these alleged crimes is incarcerated under a detention order and she will not have him available to her as a resource to assist her in flight, make a less restrictive means than detention in a jail-like setting the appropriate treatment for this defendant. The evidence adduced before Magistrate Harper and this court concerning the weight of the evidence, lack of roots in any community, offense conduct, use of aliases and harboring and traveling with her husband who was an escapee, do warrant the imposition of the most restrictive non-custodial conditions. The court finds that the following restrictions constitute the least restrictive measures which will reasonably assure the appearance of the defendant and the safety of other persons or the community during the time pending trial. See 18 U.S.C. § 3142(c)(2). The conditions of release are:

(1) Defendant shall not commit a federal, state, or local crime during the period of release;
(2) defendant is released to the custody of the Dismas House;
(3) defendant shall not travel outside the Northern District of Georgia without pri- or court permission; and
(4) defendant shall not be allowed overnight furloughs from the Dismas House, but shall instead be retained in custody there each night.

The court having made its findings pursuant to 18 U.S.C. § 3142, and § 3145, this matter is REMANDED to the United States Magistrate for preparation and execution of a bond which is not inconsistent with this order.


author: SHADUR, District Judge.

text:
    U.S. HOME CORPORATION, Plaintiff, v. GEORGE W. KENNEDY CONSTRUCTION COMPANY, INC., et al., Defendants.
    No. 82 C 7775.
    United States District Court, N.D. Illinois, E.D.
    Dec. 21, 1984.
    Arthur DeBofsky, Mark D. DeBofsky, DeBofsky & DeBofsky, Ronald S. Fishman, Fishman & Fishman, Chicago, 111., for defendant Kennedy.
    Thomas M. Grisham, Edward M. Crane, Hinshaw, Culbertson, Moelmann, Hoban & Fuller, Chicago, 111., for defendants.
   MEMORANDUM OPINION AND ORDER

SHADUR, District Judge.

George W. Kennedy Construction Company, Inc. (“Kennedy”) has moved to dismiss Count I of the recently-filed Cross-claim (the “Cross-claim”) by Mackie Consultants, Inc. (“Mackie”) and William Lorek (“Lorek”) (collectively “Mackie-Lorek”), two of Kennedy’s codefendants to the First Amended Complaint (the “Complaint”) of U.S. Home Corporation (“U.S. Home”). For the reasons stated in this memorandum opinion and order, Kennedy’s motion is granted.

Facts

In light of the limited nature of the current motion, only a bare bones outline of the setting for the motion is required. This summary statement is drawn from U.S. Home’s Complaint, of course with no implication of any findings as to the Complaint’s accuracy.

U.S. Home, a real estate developer, suffered more than $450,000 in damages when the sanitary sewer installation for its major single-family residence development in Lindenhurst, Illinois proved defective and actually collapsed in part. Mackie had designed the system (its employee Lorek was the responsible professional engineer) and Kennedy had installed it, each under a separate contract with U.S. Home.

U.S. Home sues Kennedy on four theories:

1. for breach of contract (including Kennedy’s nonconformity to Mackie’s plans and specifications for the sewer system) (Complaint Count I);
2. for breach of warranty of workmanship (Complaint Count II);
3. for negligence (including Kennedy’s (a) nonconformity to Mackie’s plans and specifications and (b) faulty workmanship) (Complaint Count III); and
4. for another, much smaller and separate breach of contract claim (Complaint Count IV).

U.S. Home sues Mackie on two theories, the second of which charges Lorek as well:

1. for Mackie’s breach of contract (including its provision of improper plans and specifications for the sewer system and its failures of consultation, technical assistance and supervision) (Complaint Count V); and
2. for Mackie-Lorek’s professional negligence (in the same respects charged in Count V) (Complaint Count VI).

Mackie-Lorek’s Cross-claim Count I asserts the familiar “active-passive” dichotomy as the predicate for Kennedy’s claimed obligation of indemnity to Mackie-Lorek. Its Paragraph 8 says:

In the alternative and without prejudice to their denials and other statements in their pleadings, these defendants contend that in the event they are found liable to the plaintiff, U.S. HOME CORPORATION, then and in such event their liability will be technical, minor or passive fault for their failure to detect installation and construction errors made by GEORGE W. KENNEDY CONSTRUCTION COMPANY and therefore they are entitled to indemnity with [sic] GEORGE W. KENNEDY CONSTRUCTION COMPANY, INC.

Paragraph 9 alleges the “active primary or major fault” was Kennedy’s, attributable to its noncompliance with Mackie’s plans and specifications. Accordingly Paragraph 10 asserts if Mackie-Lorek are found liable to U.S. Home, they will be entitled to 100% indemnification from Kennedy.

Implied Indemnity in Illinois

At the outset it must be observed Mackie-Lorek do not accurately characterize all U.S. Home’s claims. At least some of those claims are totally inconsistent with an active-passive distinction: for example, the claims that Mackie-Lorek began the chain of defective performance by generating faulty plans and specifications (Complaint Count V 1117(a) and (b) and Count VI 1118(a) and (b)). Others would appear to place Kennedy and Mackie-Lorek on a parity (or at least independently liable) in terms of fault. Thus even if Mackie-Lorek could sustain an implied indemnity claim, it would likely involve at least a complex factual determination to parse out the extent of indemnification. Indeed, given the fact that any claimed right of indemnity necessarily presupposes Mackie-Lorek’s liability to U.S. Home on the facts pleaded in the Complaint, this Court’s opinion in Winfield Design Associates, Inc. v. Quincy Jefferson Venture, 569 F.Supp. 748, 749 (N.D.Ill. 1983) (ironically called on by Mackie-Lorek in their own support) points up the dubiousness of any indemnity claim in this case.

But Mackie-Lorek fail to state a cause of action for more basic reasons. Within the past few months Morizzo v. Laverdure, 127 Ill.App.3d 767, 83 Ill.Dec. 46, 469 N.E.2d 653 (1st Dist.1984) has specifically held Illinois’ common-law cause of action for active-passive indemnity has not survived passage of the Illinois Contribution Among Joint Tortfeasors Act (the “Act”), Ill.Rev.Stat. ch. 70, 1111301-305. Under Erie v. Tompkins principles this Court is bound to follow Morizzo.

It is true, as Mackie-Lorek Mem. 3 points out, that an earlier First Appellate District case had held the Act had not extinguished indemnity in Illinois. Van Jacobs v. Parikh, 97 Ill.App.3d 610, 52 Ill.Dec. 770, 422 N.E.2d 979 (1st Dist.1981). It is also true, as Morizzo itself pointed out, that post-Van Jacobs opinions “have interpreted it as authority for the principle that implied indemnification in tort cases is still a viable concept” (Morizzo, 127 Ill.App.3d at 774, 83 Ill.Dec. at 51, 469 N.E.2d at 658). And because Lindenhurst is in the Second Appellate District, whose branch of the Appellate Court has not spoken to the issue, this Court would not be required to follow Morizzo slavishly because of what this Court has termed the Thorpe-Garcia doctrine. See Commercial Discount Corp. v. King, 552 F.Supp. 841, 848, 851 n. 8 (N.D.Ill. 1982).

In this case, though, Morizzo has not created a true conflict of authority. Instead it has defined the scope of Van Jacobs and the doctrine of implied indemnity (Morizzo, 127 Ill.App.3d at 774, 83 Ill.Dec. at 51, 469 N.E.2d at 658):

However, none of [Van Jacobs or the later] cases addressed the question raised by the failure of the legislature to provide for the specific preservation of the right of express or implied indemnity. As we interpret Van Jacobs, this court held that implied indemnity is not extinguished by the passing of the Contribution Act for cases involving some pre-tort relationship between the parties which gives rise to a duty to indemnity, e.g., in cases involving vicarious liability (lessor-lessee; employer-employee; owner and lessee; master and servant). In Lowe [v. Norfolk and Western Ry. Co., 124 Ill.App.3d 80, 79 Ill.Dec. 238, 463 N.E.2d 792], this court held that implied indemnity was still viable with respect to “upstream” claims in a strict liability action. Except possibly for those causes of action based on the theories of indemnity just enumerated, it is our opinion that the Contribution Act extinguished a cause of action for active-passive indemnity in Illinois.

That opinion — not at war with but consistent with Van Jacobs — is controlling in Erie v. Tompkins terms. When Winfield Design was issued, this Court would have been duty-bound to follow the then-existing statement of Illinois law. It must do the same now, responsive to Morizzo's current announcement of that law.

In Morizzo terms, Mackie-Lorek and Kennedy do not stand in “some pre-tort relationship ... which gives rise to a duty to indemnify____” Their independent contracts with U.S. Home, based on which Kennedy was obligated to implement the designs thereafter produced by Mackie-Lorek, are not at all akin to the exemplified lessor-lessee, employer-employee, owner-lessee and master-servant relationships. Morizzo plainly requires dismissal of Cross-claim Count I.

Mackie-Lorek Mem. 4 asks alternatively for deferral of this Court’s ruling until the Illinois Supreme Court has had the opportunity to review Morizzo. There is of course no assurance of such review (see Abbott Laboratories v. Granite State Insurance Co., 573 F.Supp. 193, 198 (N.D.Ill. 1983), describing a direct and wide-open conflict among all five Appellate Districts, which had then gone unresolved by the Supreme Court for more than four years despite ample opportunity for it to take one of the later cases — and to this Court’s knowledge still remains unresolved more than a year later). It would be irresponsible for this Court to leave the parties here in suspense, awaiting a decision that might not come at all. If and when the Illinois Supreme Court were to act in the future, and were it then to disavow the Morizzo principle, it would be time enough for Mackie-Lorek to revive that part of their Cross-claim.

One final comment is in order, related to the observation at the beginning of this section. Both the Act and common-law indemnity are loss-shifting concepts applicable to tortfeasors. At least to the extent U.S. Home sues Mackie for breach of its separate contract with U.S. Home, a contract admittedly not subcontracted by Mackie to Kennedy, neither the Act nor any notion of active-passive fault should come into play in any case.

Conclusion

Kennedy’s motion is granted, and Cross-claim Count I is dismissed. Kennedy is ordered to answer Cross-claim Count II on or before January 2, 1985.

      . In fact Kennedy has labeled its motion as one to dismiss the Cross-claim itself. Because the motion challenges only the viability of indemnity claims, while Cross-claim Count II sounds in contribution under the Illinois statute, Mackie-Lorek are clearly right in saying no challenge is made to Count II.

      . One of those opinions is a purely arguendo assumption to that effect by this Court — by way of dictum — in Winfield Design Associates, Inc. v. Quincy Jefferson Venture, 569 F.Supp. at 748, 749 n. 4 (N.D.Ill.1983).

      . This is far from the first time this Court has echoed Professor William Winslow Crosskey’s perception of the bizarre workings of Erie v. Tompkins — placing, as it does, federal courts in a less independent position than lower Illinois courts, quite at odds with the entire concept of the Supremacy Clause. See National Can Corp. v. Whittaker Corp., 505 F.Supp. 147, 148-49 n. 2 (N.D.Ill.1981).

      . This Court is aware of a division of opinion among Illinois appellate judges (expressed informally and not in formal opinions) as to the soundness of the Thorpe-Garcia doctrine. Instead it has been suggested by some judges that because the Illinois Constitution establishes only one Appellate Court, all Appellate District decisions throughout the state have equal standing with all trial courts throughout the state, with the most recent Appellate Court decision (wherever rendered) being binding upon all trial courts. Even if that alternative approach were taken, the end result here would be the same: adherance to Morizzo.


author: SHOOB, District Judge.

text:
    Herbert C. BROADFOOT, II, Trustee in Bankruptcy of Ace Contracting Company, Plaintiff, v. RELIANCE INSURANCE COMPANY, Defendant.
    Civ. A. No. C83-404A.
    United States District Court, N.D. Georgia, Atlanta Division.
    Dec. 24, 1984.

      A.L. Mullins, Jr., Atlanta, Ga., for plaintiff.
    John D. Jones, Atlanta, Ga., for defendant.
   ORDER

SHOOB, District Judge.

This is an action on an insurance contract. Plaintiff alleges breach of contract in count one, bad faith in count two, and fraud in count three. Defendant Reliance Insurance Company has brought a renewed motion for summary judgment on the ground that suit was not commenced within twelve months of discovery of the loss, as required in the contract.

Ace Contracting Company, insured by Reliance under policy Ml 41 90 90, suffered a loss during the period between January 12 and January 16, 1982, and had knowledge of the loss by January 19, 1982. After Ace filed a claim for the loss, Reliance investigated the claim; on June 3, 1982 Reliance denied that the claim was covered under the policy. On March 2, 1983, Ace filed its original complaint against Reliance for the loss.

Policy Ml 41 90 90 includes, among other provisions, the following condition:

7. Suit. No suit, action or proceeding for the recovery of any claim under this Policy shall be sustainable in any court of law or equity unless the same be commenced within twelve (12) months next after discovery by the Insured of the occurrence which gives rise to the claim____

Reliance seeks summary judgment because Ace did not institute suit within twelve months of January 19, 1982. Plaintiff contends that the time limitation on suit was waived and that any limitation period was tolled until Reliance denied the claim.

Plaintiff relies chiefly upon Nicholson v. Nationwide Mutual Fire Insurance Co., 517 F.Supp. 1046 (N.D.Ga.1981), in his contentions about tolling. The court in Nicholson found no Georgia cases on point on the issue of tolling; it then proceeded to draw upon decisions of other states in concluding that a Georgia court would hold that a contractual limitation period is tolled between the insured’s notice of loss and the insurer’s formal denial of liability. 517 F.Supp. at 1051.

The Georgia Court of Appeals, in General Insurance Co. of America v. Lee Chocolate Co., 97 Ga.App. 588, 590, 103 S.E.2d 632 (1958), flatly rejected an argument that the contractual limitation period ran from the insurer’s final denial of the claim. The court relied instead on the clear statement of the contract that the one-year limitation began to run from the date of the loss. Id.

In Modern Carpet Industries, Inc. v. Factory Insurance Association, 125 Ga. App. 150, 186 S.E.2d 586 (1971), the Georgia Court of Appeals upheld the dismissal of an action on the basis of a contractual limitation. The limitation clause required an action on the policy to be filed within a period of twelve months following the inception of the loss. The insurer accepted a late proof of loss, and it denied the claim 5V2 months later; the insured filed suit 11 months after denial. The court noted that “there was a final denial well within the period and absolutely no evidence or explanation from plaintiff as to why it waited another 11 months to bring suit.” 125 Ga.App. at 151, 186 S.E.2d 586. By upholding the dismissal, the court negated any rule that the contractual limitation begins to run from the date of the denial of coverage.

Likewise, in Pennsylvania Millers Mutual Insurance Co. v. Thomas Milling Co., 137 Ga.App. 430, 431, 224 S.E.2d 55 (1976), the court stated:

Where parties make by agreement a fixed and unqualified limitation that no suit or action on the policy shall be sustainable unless commenced within 12 months next after the incident giving rise to the claim, statutory limitations do not apply and the parties are bound to their contract as written. Under such a stipulation and limitation, the time is computed to begin from the date the incident occurred, and not from the accrual of the right of action under other stipulations of the policy.

Even though later decisions of the court of appeals seem to leave the question open, see e.g., Holland v. Independent Fire Insurance Co., 168 Ga.App. 761, 762, 310 S.E.2d 297 (1983); Looney v. Georgia Farm Bureau Mutual Insurance Co., 141 Ga.App. 266, 267, 233 S.E.2d 248 (1977), this Court must follow the expressions of that court in General Insurance, Modern Carpet Industries, and Pennsylvania Millers Mutual until contrary authority appears. Accordingly, this Court holds that, unless defendant waived the contractual limitation, that period began to run by January 19, 1982 and ended one year later.

Waiver of a contractual limitation on suit requires some affirmative promise, statement, or other act, or some actual or constructive fraud, to lead plaintiff into believing that defendant intended to enlarge on the limitation period contained in the contract. Johnson v. Georgia Farm Bureau Mutual Insurance Co., 141 Ga. App. 859, 861, 234 S.E.2d 693 (1977). Waiver is found where there are “investigations, negotiations, or assurances by the insurance company up to and past the period which would have led the insured to believe the limitation would not apply.” Modern Carpet Industries, supra, 125 Ga.App. at 151, 186 S.E.2d 586.

Plaintiff claims that there are questions of material fact as to whether Ace’s reliance on its relationship with its insurer may have lulled Ace into sleeping on its rights with regard to the suit limitation provision. Although the record reveals that negotiations were made to attempt a resolution, there is nothing to support any contention that Reliance made any affirmative statement or act to lead plaintiff to believe the limitation was waived; nor did investigations or negotiations continue near to the end of the period. There is therefore no issue of material fact as to waiver of the contractual limitation. Because there is no genuine issue of material fact that plaintiff failed timely to file suit on the policy, defendant is entitled to summary judgment on counts one and two.

In the third count plaintiff alleges fraud in the insurance transaction. Specifically, plaintiff claims fraud in Reliance’s use of ambiguous language, misrepresentations, and dissembling concerning the nature of coverage afforded under the policy, and in Reliance’s denial of benefits from the policy. Reliance argues that plaintiff has failed to state a claim upon which relief may be granted and that the fraud count is barred by the contractual limitation.

A suit for fraud that induced a contract is not governed by the contractual limitation of suit “for the recovery of any claim under this policy”: recovery for fraud is different from recovery on a contract claim.

Even though the fraud count is timely, the claim is barred by Parris & Son, Inc. v. Campbell, 128 Ga.App. 165, 196 S.E.2d 334 (1973). In that case the Georgia Court of Appeals stated that

representations alleged to have been made by the agent of the insurer, whether prior to or after the loss, to the effect that the insured was “fully covered” can amount to no more than an opinion as to coverage or a legal opinion as to the effect of the contract, which does not give rise to actionable fraud.

Id. at 168-169, 196 S.E.2d 334. Furthermore, use of ambiguous language in the contract and a denial of the claim, by themselves, do not constitute fraud. Reliance is therefore entitled to summary judgment on count three.

For the reasons stated above, the Court GRANTS the motion of defendant Reliance for summary judgment.

      . Ace Contracting Company instituted this action but was replaced as plaintiff by its trustee in bankruptcy.


author: MEREDITH, District Judge.

text:
    Ronald D. SCHIEFFER, et al., Plaintiffs, v. John BLOCK, Secretary of the United States Department of Agriculture, Defendant.
    No. 84-0541C(C).
    United States District Court, E.D. Missouri, E.D.
    Dec. 28, 1984.

      Susan Hais, Clayton, Mo., for plaintiffs.
    Wesley D. Wedemeyer, Asst. U.S. Atty., St. Louis, Mo., for defendant.
   MEMORANDUM

MEREDITH, District Judge.

This matter is before the court upon defendant’s motion to dismiss, or, in the alternative, for summary judgment. As grounds for such motion defendant states that this court lacks subject matter jurisdiction, that plaintiffs have failed to state a claim upon which relief can be granted, and that the defendant is entitled to judgment as a matter of law. For the reasons set forth below the defendant’s motion to dismiss will be granted.

The relevant facts follow. In December, 1978, plaintiffs borrowed $286,000.00 from the Farmers Home Administration, secured by plaintiffs’ farm in Lincoln County, Missouri. Plaintiffs were unable to make the required payments under the loan agreement and subsequently “voluntarily” delivered the deed to the farm to the defendant in February, 1982. The FmHA did not inform the plaintiffs that they were qualified to seek relief pursuant to 7 U.S.C. section 1981(a). Plaintiffs’ claims are based on defendant’s failure to alert the plaintiffs to their section 1981(a) rights.

In Harlow v. Fitzgerald, 457 U.S. 800, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982), the court set out the test for qualified or good faith immunity for government officials. The court held that “government officials performing discretionary functions generally are shielded from liability for. civil damages insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known.” Id. at 818, 102 S.Ct. at 2738.

Prior to Allison v. Block, 723 F.2d 631 (8th Cir.1983), the district courts in the Eighth Circuit were split on the interpretation of 7 U.S.C. section 1981(a). Compare Allison v. Block, 556 F.Supp. 400, 403-04 (W.D.Mo.1982) (notice) with Neighbors v. Block, 564 F.Supp. 1075, 1079-81, 1083 (E.D.Ark.1983) (no notice).

The first case litigating the meaning of the provisions of 7 U.S.C. section 1981(a) was not decided until four months after the Schieffer’s deed to FmHA. See Curry v. Block, 541 F.Supp. 506 (S.D.Ga.1982) The cases which came after Curry were split until the Eighth Circuit decision in Allison, supra, in December, 1983. Therefore, the state of the law was not “clearly established” as required by Harlow by the time the property was delivered to FmHA. Since all of the plaintiffs’ claims arise out of the defendant’s mistaken interpretation of 7 U.S.C. section 1981(a) and since the defendant cannot reasonably be expected to have anticipated subsequent legal developments, no cause of action lies. Therefore, plaintiffs’ claims as to damages must be dismissed for failure to state a claim upon which relief can be granted.

Furthermore, any injunctive or declaratory relief should not be considered by this court since there is no actual case or controversy. The FmHA is no longer litigating in federal courts their obligations under section 1981(a). The court in Coleman v. Block, 580 F.Supp. 194 (D.C.N.D. 1984), required that FmHA establish procedures to inform borrowers of their right to a hearing to contest a proposed acceleration and liquidation determination. The Coleman permanent injunction order has not been appealed by the government, and procedures are being drafted and implemented according to that order. In addition, plaintiffs could no longer benefit from the relief they seek. Plaintiffs’ requests are therefore moot.

For the aforementioned reasons, defendant’s motion to dismiss will be granted. The claims against defendant Block in his secretarial capacity will be dismissed with prejudice. See, e.g., Serbus v. Hoffman, 450 F.2d 296, 297 (8th Cir.1971); Rachuy v. Murphy Motor Freight Lines, Inc., 663 F.2d 57, 58 (8th Cir.1981).


author: FILIPPINE, District Judge.

text:
    Mary Ann FITZGERALD and Ernest Fitzgerald, Plaintiffs, v. Louis WILLIAMSON, et al., Defendants.
    No. 84-800C(2).
    United States District Court, E.D. Missouri.
    Dec. 31, 1984.
    Ross Harry Briggs, St. Louis, Mo., for plaintiffs.

      Jerry L. Short, Asst. Atty. Gen., Jefferson City, Mo., for defendants.
   MEMORANDUM

FILIPPINE, District Judge.

This matter is before the Court on defendant’s motion for summary judgment pursuant to Fed.R.Civ.P. 56.

This action is brought pursuant to 42 U.S.C. § 1983 and the principles of pendent jurisdiction. Plaintiffs maintain that their substantive and procedural due process rights were violated because they were denied custody of their daughter Wisa Rowland. Wisa Rowland is the natural daughter of plaintiff Mary Ann Fitzgerald, and the stepdaughter of plaintiff Ernest Fitzgerald. Plaintiffs also seek relief for the state common law tort of unlawful interference with the custody of a child.

Plaintiffs have sued six natural persons, all of whom are employees or former employees of the Missouri Division of Family Services (DFS). Plaintiffs maintain that defendants have systematically set about to terminate plaintiffs’ parental relationship with their daughter. This action arises from a state judicial proceeding styled “In the Interest of Wisa A. Rowland,” No. JU380-25J, Circuit Court of Dent County, Missouri, Juvenile Division. Plaintiffs allege that defendants circumvented the judicial process and, thereby, denied plaintiffs their constitutional rights to care for their child.

Specifically plaintiffs maintain that Wisa Rowland ran away from the home and lawful custody of plaintiffs on November 19, 1980. Later that same day Ms. Rowland appeared at the Salem Police Department and reported that plaintiff Ernest Fitzgerald had struck her with a tennis shoe on or about November 18, 1980. Following this report the police summoned defendant Michael Dye, a social service worker from the Dent County office of DFS. After conversing with Ms. Rowland and the police officer who took Ms. Rowland’s report, defendant Dye requested the juvenile court of the Forty-Second Circuit to initiate child protection proceedings. Ms. Rowland was thereafter placed in a foster home by defendant Dye.

Dye then met with plaintiffs on the evening of November 19, 1980. At this interview, plaintiffs denied that Ms. Rowland had been spanked or punished in any way on November 18, Í980. Furthermore, plaintiff Mary Fitzgerald informed Dye that she believed her daughter was emotionally unstable and possibly suicidal. Mary Ann Fitzgerald stated that Ms. Rowland had been giving the family trouble for some time, and, on one occasion, had pointed a loaded .38 caliber revolver at her sister and brother and threatened to kill them.

Plaintiffs allege that Dye believed they were lying regarding the occurrences of November 18, 1980, and the misbehavior of their daughter. Defendant Dye’s conclusion was, according to plaintiffs, based upon his unproven suspicions that plaintiffs had abused other children on prior occasions. According to plaintiffs, defendant Dye also assuméd that plaintiffs were deliberately refusing to tell the truth because they feared DFS would remove the plaintiffs’ remaining three children.

On November 21, 1980, the Honorable William Seay, Judge of the Juvenile Court for the Forty-Second Circuit of Missouri, gave oral approval to an order placing temporary legal custody of Ms. Rowland with the Dent County DFS. The order was entered ex parte. Thereafter followed further judicial proceedings. On November 25, 1980, a petition was filed by the Dent County Juvenile Officer, Roger Barr, alleging that Ms. Rowland had been abused by her stepfather. Plaintiffs, through counsel, filed a request for a hearing. The case was set for a hearing, but was continued with the consent of plaintiffs. On December 8, 1983, the Honorable Dorman L. Steelman, Juvenile Court Judge for the Forty-Second Judicial Circuit of Missouri “so ordered” a “Stipulation to Amendment of Judgment and Modification of Disposition” which states that:

Now comes Roger L. Barr, Chief Juvenile Officer of Dent County, Missouri and Mary and Ernest Fitzgerald, natural parent and stepfather of Wisa A. Rowland, who are in agreement that the “FINDING OF DISPOSITION AND ORDER OF EIGHTEEN MONTH DISPOSITION” entered in this cause does not reflect the understanding reached between the juvenile officer and said parents. The parties join in together and move this Court to amend its judgment by striking the phrase “environment of Wisa A. Rowland is injurious to her welfare” and inserting in lieu thereof, “child has disobeyed the reasonable and lawful directions of her parents____”
The parties also join in together and seek modification of the disposition to reflect the agreement reached among them. The parties therefore move this court to order the Division of Family Services of Dent County, Missouri to place said child in a licensed foster home in Dent County, Missouri. It is further ordered that all efforts shall be made to reunite Wisa A. Rowland in her natural home within 30 days of this order and that Mary and Ernest Fitzgerald shall be afforded rights of visitation of at least twice a week during this period of foster home placement.

On January 3, 1984, Judge Steelman found that Ms. Rowland had reached the age of seventeen and was, therefore, no longer in need of the care and treatment which the juvenile court could provide. Judge Steel-man ordered the jurisdiction of the juvenile court over Ms. Rowland terminated. Ms. Rowland, at the time this suit was instituted, resided with one Brenda Pasken.

The gravamen of plaintiffs’ complaint is that “[a]s a result of the defendants’ acts and omissions and due to their enticement and encouragement to Wisa A. Rowland not to return home, plaintiffs have been denied the natural and lawful custody of their child for over thirty-seven months.” In addition, plaintiffs claim that “[t]he failure of defendants James Moody and Louis Williamson to train defendants Dye, Kellog, Edgar, Mugel and Swanson respecting the plaintiffs’ family rights under the constitution and VAMS § 210.110-210.165 was the proximate cause for plaintiffs’ deprivation.”

Defendants have all moved for summary judgment. Summary judgment is appropriate when there is no genuine issue as to any material fact and the moving party is entitled to a judgment as a matter of law. Fed.R.Civ.P. 56(c). All facts must be viewed in the light most favorable to the party opposing summary judgment, and that party must receive the benefit of all reasonable inferences drawn from the facts. Portis v. Folk Const. Co., 694 F.2d 520, 522 (8th Cir.1982); Howard v. Russell Stover Candies, Inc., 649 F.2d 620, 623 (8th Cir.1981). Although summary judgment is an extreme remedy, it is also a useful tool whereby needless trials may be avoided, and it should not be withheld in an appropriate case. United States v. Porter, 581 F.2d 698, 703 (8th Cir.1978); See also Bellflower v. Pennise, 548 F.2d 776, 778 (8th Cir.1977).

Each of the defendants in this action is either an employee or a former employee of DFS. DFS is a state agency within the Department of Social Services, and its officers and employees are not part of the judicial branch of the State of Missouri. Section 211.031, R.S.Mo. provides that the juvenile court shall have exclusive jurisdiction for the commitment and care of children. Under § 211.251-2 the parent of any child committed to the custody of an institution or state agency may at any time petition the juvenile court for a modification or order relative to the child custody or the rights of the parents. Plaintiffs are thus afforded a panoply of procedural due process rights under the Missouri Juvenile Courts System. Only a juvenile court judge can transfer the custody of a child from a natural parent to another person or agency. See R.S.Mo. §§ 211.031, 211.041, 211.090, 211.101, 211.171, and 211.181. See also Mo.Sup.Ct.R. 111-119. Plaintiffs do not challenge the constitutionality of the Missouri procedures but rather seek to hold the defendants liable for their asserted enticement of Ms. Rowland from her parents.

It is beyond dispute that freedom of personal choice in matters of family life is a fundamental liberty interest protected by the Fourteenth Amendment. Santosky v. Kramer, 455 U.S. 745, 753, 102 S.Ct. 1388, 1394, 71 L.Ed.2d 599 (1982). This right includes the interest of a parent in the “companionship, care, custody and management of his or her children.” Stanley v. Illinois, 405 U.S. 645, 651, 92 S.Ct. 1208, 1212, 31 L.Ed.2d 551 (1972). Thus, plaintiffs have a protectable liberty interest, and the issue before this Court is whether that liberty was deprived without due process of law.

If the defendants had “barged into [plaintiffs’] home, seized their children, sequestered them in a secret place, and put them up for adoption without notifying the [plaintiffs] they would be guilty of violating 42 U.S.C. § 1983, no matter how regular the adoption proceeding on its face.” Ellis v. Hamilton, 669 F.2d 510, 512 (7th Cir.1982) (opinion by Judge Posner). However, in the case at bar Ms. Rowland came to the police herself and reported that she had been struck, whereupon defendants instituted appropriate legal action in the juvenile court system. Now plaintiffs allege that defendants acted with reckless or callous indifference to plaintiffs’ rights.

The Court is of the opinion that the due process procedures established by the juvenile court system of the State of Missouri, if followed, provide plaintiffs with all the due process protection to which they are entitled. If the defendants acted in substantial compliance with the procedures of the juvenile court system, then the due process rights of the plaintiffs have been adequately safeguarded. “[T]here is no denial of due process if the state provides reasonable remedies for preventing families from being arbitrarily broken up by local domestic relations officers such as the defendants in this case.” Ellis v. Hamilton, 669 F.2d at 515.

Plaintiffs allege that they filed a “Request for a Detention Hearing” which was never held. However, this detention hearing was set and continued with the consent of all parties including plaintiffs. In addition plaintiffs on July 8, 1983, signed a notarized acknowledgment and waiver of an eighteen month dispositional hearing. Furthermore, plaintiffs also consented to Wisa Rowland being made a temporary ward of the juvenile court.

Plaintiffs complain that they were denied an administrative hearing by the DFS. However, only the juvenile court has authority to award custody, and thus the denial of any administrative DFS hearing could not be the proximate cause of plaintiffs being deprived of their child provided that defendants substantially complied with the procedures of the juvenile court system. The general principles of tort causation apply in § 1983 actions, Martinez v. California, 444 U.S. 277, 285, 100 S.Ct. 553, 559, 62 L.Ed.2d 481 (1980); Lossman v. Pekarske, 707 F.2d 288, 291 (7th Cir. 1983), and thus plaintiffs may not hinge § 1983 liability on the failure to grant an administrative hearing.

The cases relied upon by the plaintiff to establish a § 1983 cause of action under the facts of this case are inapposite to the case at bar. Duchesne v. Sugarman, 566 F.2d 817 (2d Cir.1977) involved a case where domestic relations officers removed two children from the custody of the plaintiff, and did not seek judicial authorization for some twenty-seven months after separating the children from plaintiff. The defendants in that case, thus, usurped the established due process procedures of the juvenile court system and brought upon themselves § 1983 liability. Similarly, defendants in Elam v. Montgomery County, 573 F.Supp. 797 (E.D.Mo.1983) were sheriffs who were accused of coercively removing a child from the plaintiff without the benefit of a court order or determination. Id. at 800. In these two cases the defendants were accused of acting in a manner that did not substantially comply with the due process procedures of the juvenile court system. The factual circumstances in the case at bar differs markedly from the two aforementioned cases. In the instant action defendants substantially complied with the juvenile court procedures, and thus plaintiffs were not deprived of any liberty interest without due process of law. Finally Morrison v. Jones, 607 F.2d 1269 (9th Cir.1979) simply stands for the proposition that domestic relations officers can be liable under § 1983 for their actions. Id. at 1275-76. Moreover, Morrison did not specifically address the issue of § 1983 liability when the state has established due process procedures.

After careful consideration the Court finds that defendants have shouldered their burden and have established that they are entitled to summary judgment. The Court in the exercise of its discretion will also dismiss plaintiffs’ pendent state law claims. United Mine Workers v. Gibbs, 383 U.S. 715, 726-27, 86 S.Ct. 1130, 1139-40, 16 L.Ed.2d 218 (1966).


author: HATFIELD, District Judge.

text:
    Robert O. ORDAHL, Plaintiff, v. UNITED STATES of America, Defendant.
    No. CV-84-27-GF.
    United States District Court, D. Montana, Great Falls Division.
    Jan. 2, 1985.
    Randall O. Skorheim, Great Falls, Mont., for plaintiff.
    Byron H. Dunbar, U.S. Atty., Carl E. Rostad, Asst. U.S. Atty., Great Falls, Mont., for defendant.
   MEMORANDUM AND ORDER

HATFIELD, District Judge.

Presently before the court are defendant’s motions to reduce the ad damnum clause of plaintiff’s complaint and to dismiss this action. Defendant alleges that this court lacks subject matter jurisdiction over the plaintiff’s claim, which was filed under the Federal Tort Claims Act (hereinafter “FTCA”), 28 U.S.C. § 1346(b) and 2671 et seq., and that plaintiff’s complaint violates § 2675(b) of the FTCA.

On March 5, 1982, plaintiff was allegedly struck in the eye by a dart blown from a blowgun fired by Airman First Class Don A. Harvey. The blowgun is alleged to have been owned by Senior Airman Gregory L. Bucher. Plaintiff allegedly suffered serious physical injuries as well as loss of earning capacity and interference with his normal course of living. At the time of the incident, plaintiff was stationed at Malmstrom Air Force Base (“the Base”), and lived in a barracks building on Malmstrom Air Force Base, a military reservation. Plaintiff alleges that the defendant negligently or intentionally allowed the presence of the blowgun in the barracks; that the presence of such a weapon violates Air Force Regulations; and that the result of said negligence was injuries to plaintiff’s eye.

On February 28, 1983, plaintiff filed his claim with the Claims Department, United States Air Force, wherein he alleged injuries to his person in the amount of $750,-000. 00..The claim was denied. Shortly thereafter, this action was commenced, in which plaintiff requested total damages of $1,000,000.00.

MOTION TO REDUCE AD DAMNUM

On March 23, 1984, defendant moved that the ad damnum clause of plaintiff’s action be reduced to $75,000.00 on the bases of 28 U.S.C. § 2675(b) and Rule 8(a) Federal Rules of Civil Procedure. On April 2, 1984, defendant was allowed to amend his motion to reduce the ad damnum to read $750,000.00, rather than $75,-000.00.

The federal courts have consistently held that unless the plaintiff establishes new evidence or intervening facts, that the ad damnum clause may not allege damages in excess of the amount claimed in the administrative action. Kielwien v. United States, 540 F.2d 676 (4th Cir.), cert. den., 429 U.S. 979, 97 S.Ct. 491, 50 L.Ed.2d 588 (1976); Schwartz v. United States, 446 F.2d 1380 (3rd Cir.1971).

In this case, the plaintiff has not responded to the United States’ motion to reduce the ad damnum clause. Under the facts which now exist, no newly discovered evidence or intervening fact are apparent. In accordance with the Federal Tort Claims Act, the ad damnum clause of plaintiff’s complaint must be reduced to $750,000.00.

MOTION TO DISMISS

The motion to dismiss filed by the United States is based on allegations that plaintiff has failed to state a claim upon which relief can be granted, in that plaintiff was serving on active duty in the military at the time of the injury, and that the injury was “incident to service,” thus barring recovery through the FTCA under the Feres doctrine. Feres v. United States, 340 U.S. 135, 146, 71 S.Ct. 153, 159, 95 L.Ed. 152 (1950). A review of the briefs and relevant case law leads the court to conclude that, under the particular facts of this case, plaintiff’s injuries were not incident to service, and that his suit is not barred by the FTCA.

A. THE FTCA

The FTCA was passed in order to waive the traditional sovereign immunity of the Federal Government in actions for

injury or loss of property, or personal injury or death caused by the negligent or wrongful act or omission of any employee of the government while acting within the scope of his office or employment, under circumstances where the United States, if a private person, would be liable to the claimant in accordance with the law of the place where the act or omission occurred.

28 U.S.C. § 1346(b). Additionally, it is provided by the FTCA that members of the armed forces are employees of the federal government. Id. at § 2671. Although the FTCA contains 12 exceptions to the general waiver of immunity, no exception bars suits by members of the military, except for claims arising out of “combatant activities ... during a time of war.” Id. at § 2680(j).

B. BROOKS — FERES—BROWN

Between 1949 and 1954, the United States Supreme Court considered the issue of whether injured military personnel are barred from recovering under the FTCA where injuries are caused by employees of the federal government. See, e.g., Feres, Id., Brooks v. United States, 337 U.S. 49, 69 S.Ct. 918, 93 L.Ed. 1200 (1949); United States v. Brown, 348 U.S. 110, 75 S.Ct. 141, 99 L.Ed. 139 (1954). In Brooks, the first case to consider the issue, Welker Brooks, his brother Arthur, both members of the. armed forces, and their father James, were involved in an automobile accident with a vehicle driven by a civilian employee of the Army. Arthur was killed, and Welker and James were injured. The court held that the accident had no relationship to the Brooks’ army careers, that the injuries were not caused by their status in the service, and that the claim was cognizable under the FTCA. In dicta, the court conceded that permitting some claims by service members may interfere with military discipline, but stated that it found no Congressional intent to exclude every tort claim by service members regardless of the circumstances of the injury. Id. 337 U.S. at 51-52, 69 S.Ct. at 919-920.

The court next considered the issue in the Feres case, which was a consolidation of three cases brought by service members: Feres, brought by the executrix of Feres’ estate for his death caused by a fire in his barracks, allegedly negligently caused by a defective heating plant, while he was on active duty; Jefferson, a medical malpractice action brought for injuries caused by Army doctors in an Army hospital by negligently leaving a 30-inch towel in plaintiff’s stomach during an operation; and Griggs, another medical malpractice action brought by the executrix of Griggs’ estate for negligent treatment by Army surgeons. The court held, in all three cases, that the injuries involved were incident to military service. Brooks and Feres were distinguished by the court, which noted that “Brooks did not arise out of or in the course of military service.” Feres 340 U.S. at 146, 71 S.Ct. at 159.

The last case in which the court considered the issue, involved a discharged veteran who was suing for damages caused by negligent treatment by an Army doctor in a Veteran’s Administration (“VA”) hospital. Brown, Id. The court there held, consistent with Brooks and Feres, that because the injury occurred at a time while the injured party was not on active duty, the fact that his military service had entitled him to medical benefit did not constitute close enough nexus to render the injury “incident to service.” Therefore, recovery under the FTCA was allowed. Id.

C. AFTER FERES

Since Brooks, Feres, and Brown, federal circuit and district courts have wrangled with the definition of the scope of the term, “incident to service”. A general rule which has been adopted in many courts is that where the activity in which the plaintiff was involved at the time of the alleged negligence is one which is dependent on the plaintiff’s status in the military, recovery will not be allowed.

The general analysis which has evolved in the interpretation of the term “incident to service” in determining whether to allow recovery, hinges on the activity in which the plaintiff or injured service member was involved at the time of the injury. In a recent case, the Ninth Circuit has considered the issue and has more clearly defined the factors it considers in reaching a conclusion. Johnson v. United States, 704 F.2d 1431 (9th Cir.1983).

In Johnson, the court considered four factors in determining whether the injured service member’s activities at the time of the injury are such as to provoke the operation of Feres. Johnson, Id. First, the court considers the place where the negligent act allegedly occurred, noting that “government negligence on a military base should not absolutely bar recovery.” Ids. at 1436. With this analysis, the court expressly rejected a rationale it had used in a 1979 case, in which it distinguished between acts which occur “on-base” and those which occur “off-base.” Troglia v. U.S., 602 F.2d 1334, 1339 (9th Cir.1979). See, e.g., Bryson, Id.; Downes v. U.S., 249 F.Supp. 626 (E.D.N.C.1965); Rich v. U.S., 144 F.Supp. 791 (E.D.Pa.1956); Nowotny v. Turner, 203 F.Supp. 802 (M.D.N.C.1962). Instead, the court mandated that the circumstances surrounding the actual activity of the injured party must be considered. Johnson at 1437.

The second factor considered is the duty status of the plaintiff at the time of the injury. Id. While the court conceded that duty status is not dispositive, it is a mandatory consideration to the extent that it relates to the nexus between the activity and military service. Id., see, e.g., Troglia, Id.; Woodside, Id. In Johnson, a case first heard in U.S. District Court for the District of Montana, the injured service member was off duty at the time of the injury; there was no relationship between his service and the activity. Johnson, Id.

Third, the court considered the benefits of military service which accrue to the service member because of his status. Id. at 1439. The critical concern with this factor is whether the plaintiff was enjoying a purely military benefit at the time of the injury. Id. In Johnson, the service member was working at a second job which, although it was in a military club, he could have held as a civilian. Military status did not relate to this entitlement to participate in this employment.

Finally, the fourth factor considered in Johnson was the nature of the plaintiff’s activities at the time of the negligent act. Id. The court viewed this factor as significant because of the concern expressed by the Supreme Court in Feres of eroding military discipline. Feres, Id. The court, consistent with Feres, was cautious in its approach to issues which may allow an injured service member to “second-guess” the judgment of his superiors. Johnson, Id. To allow an action which would amount to second-guessing of military decisions could easily affect the future willingness of service members to obey orders.

In light of the above four factors, the Johnson court considered all allegations by the plaintiff that his injuries were caused by government negligence in that it had allowed an NCO club to be open after hours in violation of Air Force Regulations. It held that plaintiff’s activities at his second job were “purely personal”, and “only in the remotest sense subject to military discipline.” Johnson at 1439. In fact, with regard to the concern in some cases about the potential erosion of military discipline, the court in Johnson held:

We are not dealing with a case where the government’s negligence occurred because of a decision requiring military expertise or judgment. Rather, the government is negligent precisely because it failed to follow established military rules and procedures____

Id. at 1440.

D. JOHNSON AND ORDAHL

This case must be analyzed with respect to the Johnson factors. First, the alleged act of negligence {i.e., allowing a blowgun in the barracks) occurred on base. As noted above, this fact does not bar recovery. Johnson, Id. Second, the duty status of the plaintiff Ordahl is that he was on active duty in an “off-duty” status. The relevant issue is whether his activities at the time of the injuries related in any way to his military duties. It is unknown what specific activity the plaintiff was involved in at the time of his injury, but it is conceded by both parties that he was off duty at the time. It appears that plaintiff’s activities were not related to his military duties; he was in the barracks socializing with another service member who happened to live there.

Third, the benefits which accrue to plaintiff Ordahl because of his status in the military must be considered. The United States’ position is that the plaintiff was taking advantage of a uniquely military benefit at the time of the injury in that he would not have been in the barracks were he not in the military. This court takes a contrary view; there is nothing which would preclude a civilian from visiting a service member at his barracks. As in Johnson, the plaintiff’s military status did not bear a significant relationship to the activity. Regardless, the activity in this case is not the sort contemplated by the court as a government-sponsored “benefit” which would bar recovery. See, e.g., Woodside, Id.; Chambers v. U.S., 357 F.2d 224, 229 (8th Cir.1966); Hass, Id.

Finally, the fourth Johnson factor must be considered, i.e., the nature of plaintiff’s activities at the time of the alleged negligent act. As in Johnson, it seems clear in the present case that the plaintiff was involved in a “purely personal” activity. Additionally, the government in this case was allegedly negligent because it failed to follow its own rules and regulations. Consequently, the court is unable to conclude that military discipline would be endangered by allowing the present action to proceed.

E. CONCLUSION AND ORDER

For the reasons set forth above, IT IS HEREBY ORDERED AND ADJUDGED that defendant’s motion to reduce the ad damnum clause in plaintiff’s complaint to $750,000.00 be, and the same hereby is, GRANTED; and that defendant’s motion to dismiss be, and the same hereby is, DENIED.

      . See Tab 8, Declaration of Col. Ramutis R. Semeta. 28 U.S.C. § 2675 mandates that, as a prerequisite to filing suit under the FTCA, a claimant must file a claim with the "appropriate Federal agency.”

      . 28 U.S.C. § 2675(b) provides that:
      Action under this section shall not be instituted for any sum in excess of the amount of the claim presented to the federal agency, except where the increased amount is based upon newly discovered evidence ... or upon allegations of proof of intervening facts, relating to the amount of the claim.

      . See, e.g., Chambers v. U.S., 357 F.2d 224 (8th Cir.1966) (death of active duty airman in swimming pool on base); Woodside v. United States, 606 F.2d 134 (6th Cir.1979) (wrongful death action by widow of officer killed in plane crash where plane belonged to aero club of which he was a member by virtue of his military status); Hass v. United States, 518 F.2d 1138 (4th Cir. 1975) (Marine injured riding horse owned by Marine Corps); Richardson v. United States, 226 F.Supp. 49 (E.D.Va.1964) (Marine NCO on weekend liberty injured as he tried to escort an enlisted Marine from the NCO Club was incident to service because the Club was operated for the benefit of soldiers and because the NCO acted pursuant to a perceived duty as a Marine); Henninger v. U.S., 473 F.2d 814 (9th Cir.1973) (action for malpractice of Navy doctor barred); Bryson v. U.S., 463 F.Supp. 908 (E.D.Pa.1978) (action of administratrix of estate of Army private allowed where decedent’s actions were "in no significant way a consequence of his use or benefits ... available because of his status.”)


author: PEREZ-GIMENEZ, Chief Judge.

text:
    Angel M. COSME-NIEVES, et al., Plaintiffs, v. COLONEL ROBERT C. DESHLER, CO., Fort Buchanan, et al., Defendants.
    Civ. No. 83-0196(PG).
    United States District Court, D. Puerto Rico.
    Jan. 8, 1985.

      Samuel C. Vázquez Matías, San Juan, P.R. & Hector L. Marquez, Hato Rey, P.R., for plaintiffs.
    Francisco A. Besosa, Asst. U.S. Atty., Hato Rey, P.R., for defendants.
   OPINION AND ORDER

PEREZ-GIMENEZ, Chief Judge.

Present before the Court is defendants’ motion to dismiss the claims of plaintiffs Angel M. Cosme-Nieves, Secundino Machado, Tomás García, and Lorraine Gorski, non-appropriated fund employees of the Fort Buchanan Installation Club System.

Plaintiffs commenced this action in the Superior Court of Puerto Rico, San Juan Part, on October 13, 1982. They seek to recover allegedly unpaid wages in the amount of $58,508.66 and liquidated damages in an equal amount. Plaintiffs also seek an unspecified amount in interest, costs, expenses and attorney’s fees. Plaintiffs base their claims on the Fair Labor Standards Act, 29 U.S.C. § 201, et seq., (hereafter “FLSA”) and all laws of the Commonwealth of Puerto Rico providing greater benefits to employees. The defendants are Robert C. Deshler, Commanding Officer, Fort Buchanan; Colonel Clarence H. Wolliver, Commanding Officer, Fort McPherson, Georgia; the Fort Buchanan Installation Club System, a non-appropriated fund instrumentality of the Government of the United States and the Non-Commissioned Officer’s Open Mess and Officer’s Open Mess, both subdivisions of the Installation Club System.

On February 4, 1983, the defendants filed a Petition removing the case to this Court. On February 15, 1983, plaintiffs, by motion, requested remand to the Commonwealth Court. The Court denied plaintiffs’ request to remand. 561 F.Supp. 1173.

Plaintiffs base this action on 29 U.S.C. § 218, 29 U.S.C. § 216(b) and the "more beneficial” laws of Puerto Rico. The government moves to dismiss this action on the grounds that plaintiffs fail to state a claim upon which relief may be granted and because the Court lacks subject matter jurisdiction.

The government alleges that plaintiffs have failed to state a claim upon which relief may be granted for two reasons. First, the government submits that plaintiffs have failed to name a proper defendant. Second, the government challenges the applicability of the “more beneficial” laws of the Commonwealth of Puerto Rico concerning overtime compensation.

Both plaintiffs and the government agree that the proper defendant is the employer. The critical question is who is the employer under the FLSA. Plaintiffs repeatedly argue that under the FLSA, they have the option of choosing either the United States or the non-appropriated fund instrumentality, the Installation Club System, as the defendant. Plaintiffs also argue that the United States cannot be the defendant in this case. These diverse positions are inherently contradictory and not credible.

It is absolutely contradictory for plaintiffs to assert that under the same statutory provision the United States can and cannot be the employer and a proper defendant. Additionally, adding to the contradiction, plaintiffs further assert that the Installation Club System is also the employer under the FLSA. This means that plaintiffs had separate employers while performing identical duties and receiving one paycheck. This is not realistically or logically supportable.

Plaintiffs contend that this Court’s decision in Morales v. Senior Petty Officer’s Mess, 366 F.Supp. 1305 (D.P.R.1973), supports the position that the Installation Club System is the proper defendant. Plaintiffs’ reliance on Morales is clearly misplaced. Plaintiffs’ action here is based on 29 U.S.C. § 218(a). The Court in Morales was only concerned with 29 U.S.C. § 218(b)(2) and whether the United States had waived sovereign immunity for non-appropriated fund instrumentalities of the Armed Forces. More significantly, when Morales was decided in 1973, the United States was specifically excluded from the definition of the term “employer” under 29 U.S.C. § 203(d). Unquestionably, the 1974 amendments to the FLSA include the Government of the United States within the definition of “employer”.

Under the FLSA, non-appropriated fund employees are employees of the Government of the United States. The plain language of 29 U.S.C. § 203(e) cannot be interpreted otherwise. The United States as the employer is the proper defendant. Plaintiffs have failed to name the United States as the defendant.

The government has also presented two exhibits with its Motion to Dismiss. These exhibits are letters from the Department of Labor and Human Resources for the Commonwealth of Puerto Rico concerning the applicability of Act No. 379 of 1948 and the mandatory decrees promulgated by the Minimum Wage Board under the authority of Act No. 96 of 1956 (Minimum Wage Law). In both letters, it was the Department of Labor and Human Resources’ position that the aforementioned Acts are not applicable to federal employees in Puerto Rico. The provisions of the laws of the Commonwealth of Puerto Rico concerning minimum wages specifically exclude persons employed by the Government of the United States and the Commonwealth of Puerto Rico. Act No. 379, which contains the provisions establishing overtime and rates of overtime compensation, excludes employees of the Commonwealth Government and other governmental bodies. When the Commonwealth Government excludes itself and other entities from the application of Act No. 379 and twice expresses the opinion that Act No. 379 does not apply to federal employees, there is no justifiable basis for plaintiffs’ assertion that the so-called “more beneficial” laws apply to federal employees. A responsible reading of the “more beneficial” laws, buttressed by the unequivocal opinion of the Department of Labor and Human Resources, leads the Court to the inescapable conclusion that plaintiffs do not have a cause of action under 29 U.S.C. § 218(a).

The government also contends that the Court lacks subject matter jurisdiction because the proper jurisdictional basis for this action is the Tucker Act, 28 U.S.C. § 1346(a)(2). This Court agrees.

As previously addressed, the proper defendant is the Government of the United States. Each plaintiff’s claim is in excess of $10,000 in backpay and damages. Plaintiffs admit that this case arises under an Act of Congress. The Court’s jurisdiction is limited under 28 U.S.C. § 1346(a)(2) to claims not exceeding $10,000 in amount.

The United States Claims Court, under 28 U.S.C. § 1491, has exclusive jurisdiction over all non-tort claims against the United States for money damages in excess of $10,000. Graham v. Henegar, 640 F.2d 732, 734, nn. 5, 6 (5th Cir.1981). It should be noted that plaintiffs admit the United States Claims Court has exclusive jurisdiction if plaintiffs “elected” to choose the United States as the defendant. It is particularly disturbing that plaintiffs’ counsel have extensively engaged the resources of the Court on the baseless conception that under the same statute plaintiffs can “elect” both defendants and forums.

In view of the above, the Court ORDERS that the Government's motion be and is hereby GRANTED and that this action be and is hereby DISMISSED.

The Court FURTHER ORDERS costs against plaintiffs.

IT IS SO ORDERED.

      . Since the inception of this suit, Colonel Deshler and Colonel Wolliver have been reassigned from their respective duty positions. They were both named as defendants in their official capacities.

      . Plaintiffs sought a Writ of Mandamus or Certiorari from the United States Court of Appeals for the First Circuit to reverse the decision not to remand. It was denied. (1st Cir. August 22, 1983) (No. 83-1351). Plaintiffs requested the First Circuit to reconsider its decision, which was also denied. (1st Cir. October 7, 1983) (No. 83-1351).

      . 29 U.S.C. § 218 provides:
      (a) No provision if this chapter or of any order thereunder shall excuse noncompliance with any Federal or State law or municipal ordinance establishing a minimum workweek established under this chapter, and no provision of this chapter relating to the employment of child labor shall justify noncompliance with any Federal or State law or municipal ordinance establishing a higher standard than the standard established under this chapter. No provision of this chapter shall justify any employer noncompliance with any Federal or State law or municipal ordinance establishing a higher standard than the standard established under this chapter. No provision of this chapter shall justify any employer in reducing a wage paid by him which is in excess of the applicable minimum wage under this chapter, or justify any employer in increasing hours of employment maintained by him which are shorter than the maximum hours applicable under this chapter.
      (b) Notwithstanding any other provision of this chapter (other than section 213(f) of this title) or any other law—
      (1) any Federal employee in the Canal Zone engaged in employment of the kind described in section 5102(c)(7) of Title 5, or
      (2) any employee employed in an nonappropriated fund instrumentality under the jurisdiction of the Armed Forces, shall have his basic compensation fixed or adjusted at a wage rate that is not less than the appropriate wage rate provided for in section 206(a)(1) of this title (except that the wage rate provided for in section 206(b) of this title shall apply to any employee who performed services during the workweek in a work place within the Canal Zone), and shall have his overtime compensation hourly rate not less than the overtime rate provided for in section 207(a)(1) of this title.

      . 29 U.S.C. § 216(b) provides:
      Any employer who violates the provisions of section 206 or section 207 of this title shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages. Any employer who violates the provisions of section 215(a)(3) of this title shall be liable for such legal or equitable relief as may be appropriate to effectuate the purposes of section 215(a)(3) of this title, including without limitation employment, reinstatement, promotion, and the payment of wages lost and an additional equal amount as liquidated damages. An action to recover the liability prescribed in either of the preceding sentences may be maintained against any employer (including a public agency) in any Federal or State court of competent jurisdiction by any one or more employees for and in behalf of himself or themselves and other employees similarly situated.

      . The "more beneficial” laws which plaintiffs submit are applicable are 29 L.P.R.A. §§ 273, 274.

        . In the alternative, the government contends that the statute of limitations as found in 29 U.S.C. § 255, barred all claims prior to October 13, 1980. Plaintiffs submit that there is a ten-year statute of limitations under 29 L.P.R.A. § 246d(a)-(e). This issue need not be addressed in light of the Court's decision.

      . 29 U.S.C. § 203(e) provides in part:
      (e)(1) Except as provided in paragraphs (2) and (3), the term "employee" means any individual employed by an employer.
      (2) In the case of an individual employed by a public agency, such term means—
      (A) any individual employed by the Government of the United States—
      (i) as a civilian in the military departments (as defined in section 102 of Title 5),
      (ii) in any executive agency (as defined in section 105 of such title),
      (iii) in any unit of the legislative or judicial branch of the Government which has positions in the competitive service,
      (iv) in a nonappropriated fund instrumentality under the jurisdiction of the Armed Forces, or
      (v) in the Library of Congress;

      . The first letter is dated July 23, 1980, and is signed by the then Secretary for the Department of Labor and Human Resources, Carlos S. Quirós. The second letter is dated June 4, 1984, and is signed by Julio Cruz Rodriguez for the Solicitor of Labor.

      . 29 L.P.R.A. § 246e provides in part:
      (a) This act shall not apply to:

      (1) ...
      (2) Persons employed by the Government of the United States of America or by the Government of the Commonwealth of Puerto Rico, with the exception of those agencies or instrumentalities of the latter which operate as private businesses or enterprises; ...

      . 29 L.P.R.A. § 285 provides in part:
      The provisions of this Act shall not apply to the employees of the Commonwealth Government, the Municipal governments, the Government of the Capital, or of the agencies or instrumentalities of said governments, excepting such agencies or instrumentalities as are devoted to agricultural, industrial, commercial or public-service enterprises.

      . 28 U.S.C. § 1346(a) provides in pertinent part:
      (a) The district courts shall have original jurisdiction, concurrent with the Court of Claims, of:
      (2) Any other civil action or claim against the United States, not exceeding $10,000 in amount, founded either upon the Constitution, or any Act of Congress, or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or unliquidated damages in cases not sounding in tort...

      . Plaintiffs’ state in their voluminous opposing brief, at pp. 42, 43:
      Should the employees elect this option [suit against the United States]; then, they [plaintiffs] would be required to file with the Court of Claims. This is an option which plaintiffs did not elect for obvious reasons.
      Plaintiffs’ counsel also asserted that they did not sue the United States because they were not inclined or willing to do so. Such a cavalier attitude in bringing judicial actions is totally unacceptable.


author: TASHIMA, District Judge.

text:
    CALIFORNIA CHAMBER OF COMMERCE, etc., et al., Plaintiffs, v. C. Robert SIMPSON, etc., Defendant.
    No. CV 84-4692 AWT.
    United States District Court, C.D. California.
    Jan. 8, 1985.

      Richard J. Simmons, Thomas E. Hill, Mu-sick, Peeler & Garrett, Los Angeles, Cal., Robert L. Thompson, Thomas A. Pogue, Elarbee, Thompson & Trapnell, Atlanta, Ga., for plaintiffs.
    Louis Giannini, Chief Counsel, H. Thomas Cadell, Jr., Div. of Labor Standards Enforcement, San Diego, Cal., for defendant.
   MEMORANDUM OPINION

TASHIMA, District Judge.

This is an action for declaratory and injunctive relief against the Labor Commissioner of the State of California. At issue is whether or not the enforcement of state law and procedures with respect to severance benefit plans has been preempted by the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq. Plaintiffs have moved for summary judgment. Defendant has moved to dismiss as against plaintiff California Chamber of Commerce (“CCC”) for its lack of standing.

CCC’S STANDING

Defendant challenges CCC’s standing because it does not allege that it is itself a participant, beneficiary or fiduciary under ERISA who are the only classes of persons (in addition to the Secretary of Labor) to whom Congress has granted the right under ERISA to enforce the act. 29 U.S.C. § 1132. See Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1, 103 S.Ct. 2841, 2852, 2854, 77 L.Ed.2d 420 (1984). Defendant, however, completely ignores the doctrine of associational standing, a doctrine that Construction Laborers did not address.

CCC is a non-profit corporation. It is a statewide membership trade association made up of business members. It advises its members on state and federal legislative and judicial developments of interest to the business community. Through publications and seminars, it informs its members of their obligation under state and federal laws. It engages in litigation to protect its members’ interests. It and its members are ERISA “employers.” 29 U.S.C. § 1003. A number of its members, including plaintiff Scovill, Inc., sponsor and administer severance pay benefit plans, funds and programs (collectively “severance benefit plans”).

In these circumstances, CCC has associational standing to sue. Its members have standing to sue in their own right. Indeed, the standing of plaintiff Scovill, a CCC member, is unchallenged. The interests CCC seeks to protect here are germane to its purpose. Individual member participation is not required by either the nature of the claim asserted or the relief requested. Hunt v. Washington State Apple Advertising Comm ’n, 432 U.S. 333, 343, 97 S.Ct. 2434, 2441, 53 L.Ed.2d 383 (1977); Black Faculty Ass’n v. San Diego Community College Dist., 664 F.2d 1153, 1156 (9th Cir. 1981). I have heretofore implicitly held that the doctrine of associational standing applies in ERISA cases. Council of Hawaii Hotels v. Agsalud, 594 F.Supp. 449, 450 n. 1 (D.Hawaii 1984). I now do so expressly.

Moreover, although neither party has raised the issue, it appears by virtue of a final judgment in another action that defendant is collaterally estopped from relitigating the issue of CCC’s standing. In a prior action, this court concluded that CCC had standing to bring an action for injunctive and declaratory relief under ERISA both on its own behalf and on behalf of its members. California Hosp. Ass’n v. Henning, 569 F.Supp. 1544, Conclusion of Law No. 3 (C.D.Cal.1983).

The doctrine of collateral estoppel “forecloses relitigation of those issues of fact or law that were actually litigated and necessarily decided by a valid and final judgment in a prior action between the parties.” In re Duncan, 713 F.2d 538, 541 (9th Cir.1983). The principles of collateral estoppel apply to jurisdictional issues, such as standing. Stewart Sec. Corp. v. Guaranty Trust Co., 597 F.2d 240, 241 (10th Cir.1979); Cutler v. Hayes, 549 F.Supp. 1341, 1343 (D.D.C.1982). Finally, although California Hosp. Ass’n is on appeal, the pendency of an appeal does not suspend the operation of an otherwise final judgment as collateral estoppel. Convergence Corp. v. Videomedia, 539 F.Supp. 760, 762 (N.D.Cal.1981); United States v. Abatti, 463 F.Supp. 596, 599 (S.D.Cal.1978).

I, therefore, conclude that CCC has associational standing to sue under ERISA.

PREEMPTION UNDER ERISA

ERISA expressly preempts “any and all State laws insofar as they may now or hereafter relate to any employee benefit plan described in section 1003(a) of this title and not exempt under section 1003(b)....” 29U.S.C. § 1144(a).. Defendant concedes that severance benefit plans are “employee benefit plans” within the meaning of ERISA. See Blau v. Del Monte Corp., 748 F.2d 1348 at 1352 (9th Cir.1984). As employee benefit plans, plaintiffs’ plans are covered by § 1003(a) since it is undisputed that the employers represented by CCC are engaged in commerce or in an industry affecting commerce. Id. at 1351.

The threshold inquiry here is whether the provisions plaintiffs seek to have declared preempted are “State laws” within the meaning of § 1144(a). Plaintiffs contend that the following provisions are state laws and, thus, are preempted by ERISA: (1) Section 10.65 of the Operations and Procedures Manual of the Division of Labor Standards Enforcement (the “Manual”); (2) Chapin v. Fairchild Camera & Instrument Corp., 31 Cal.App.3d 192, 107 Cal.Rptr. 111 (1973) {“Chapin”), a copy of which is provided in § 10.65 of the Manual; and (3) Cal.Labor Code §§ 98(a) & 96(h).

The term “State law” includes “all laws, decisions, rules, regulations, or other State action having the effect of law, of any State____” 29 U.S.C. § 1144. Chapin and CaLLabor Code §§ 96(h) and 98(a) are clearly state laws within this definition. See California Hosp. Ass’n v. Henning, 569 F.Supp. 1544, 1547 (C.D.Cal.1983) (Cal. Labor Code § 227.3 and the California case, Suastez v. Plastic Dress-Up Co., 31 Cal.3d 774, 183 Cal.Rptr. 846, 647 P.2d 122 (1982) are state laws within the meaning of ERI-SA). Defendant contends, however, that § 10.65 of the Manual is only an instructional tool and, thus, is not a state law. Insofar as § 10.65 attempts to provide a framework for deciding severance claims, for example by providing a copy of Chapin for guidance to Deputy Labor Commissioners as to the payment of severance benefits to employees who continue to be employed by a successor employer, it serves as an enforcement guide. As such, it is a “State law” within the meaning of ERISA. California Hosp. Ass’n, 569 F.Supp. at 1547 (“Internal Policy and Procedures Memorandum” regulating vacation plans was enforcement policy and, thus, fell within definition of state law).

In order to be preempted by ERISA, a state law must “relate to” an employee benefit plan. Under ERISA, a law relates to an employee benefit plan if it “has a connection with or reference to such a plan.” Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490 (1983). The state law need not, contrary to defendant’s contention, be inconsistent with specific ERISA provisions. Rather, Congress intended ERISA to have a broad preemptive scope, occupying the entire field of regulation of employee benefit plans. Id. at 2900-01; Standard Oil Co. v. Agsalud, 633 F.2d 760, 765 (9th Cir.1980), aff'd, 451 U.S. 801, 102 S.Ct. 79, 70 L.Ed.2d 75 (1981); California Hosp. Ass’n, 569 F.Supp. at 1546-47.

Clearly, § 10.65 of the Manual and Chapin “relate to” employee benefit plans since they directly regulate the payment of severance benefits to employees. However, Cal.Labor Code §§ 96(h) and 98(a) require a somewhat different analysis because neither directly regulates employee benefit plans; rather, each is part of a procedural scheme for the adjudication of, inter alia, severance benefit claims.

Section 98(a)

Section 98(a) provides that the Labor Commissioner may investigate and hold hearings as to severance benefit claims. It “relates to” employee benefit plans due to its interference with the adjudication of employee claims for severance benefits under ERISA. Under California’s statutory scheme, once an employee files a claim with the Labor Commissioner for severance benefits, the Commissioner may hold an administrative hearing to adjudicate the merits of that claim. Cal.Labor Code § 98(a). If the Commissioner sets a hearing on an employee’s complaint, judicial relief must await the Commissioner’s administrative order, decision or award, from which an appeal may be taken to a state court of competent jurisdiction for de novo review. Id. at § 98.2(a).

Section 98(a) relates to employee benefit plans in that it intrudes upon the Congressional scheme in at least three ways. First, under ERISA, the Secretary of Labor is the executive agency charged with its enforcement. He has the statutory authority to conduct investigations under ERISA. 29 U.S.C. § 1134. Congress did not contemplate that state labor commissioners should have parallel, equivalent investigatory authority over purported ERISA violations.

Second, ERISA does not contemplate that parties to a benefits dispute be required to undergo an administrative hearing and determination as a prerequisite to the civil action authorized by 29 U.S.C. § 1132(a). ERISA provides that state and federal courts have concurrent jurisdiction over benefit recovery actions. 29 U.S.C. § 1132(e)(1). If such actions are commenced in state court, the defendant has the right of removal to federal court. McConnell v. Marine Eng’rs Beneficial Ass’n, 526 F.Supp. 770 (N.D.Cal.1981); Lafferty v. Solar Turbines Int'l, 666 F.2d 408 (9th Cir.1982) (per curiam) (by implication). Under § 98(a), however, a defendant would have to await final determination of the administrative proceeding before the Labor Commissioner before exercising its right of removal. Thus, in this manner also, the provision relates to employee benefit plans.

Finally, the state statute mandates that attorney’s fees and costs be awarded against the party who seeks judicial review of the Labor Commissioner’s decision and is unsuccessful on appeal. Cal.Labor Code § 98.2(b). This provision clearly is intended to discourage appeal from the Labor Commissioner’s award and conflicts with ERISA’s provision for discretionary attorney’s fees and costs to either party. 29 U.S.C. § 1132(g)(1). See Hummell v. S.E. Rykoff & Co., 634 F.2d 446, 452-53 (9th Cir.1980).

Given the Congressional intent to totally preempt all state regulation of employee benefit plans, I hold § 98(a) to be invalid as it applies to severance benefit claims. See Shaw, 103 S.Ct. at 2900.

Section 96(h)

Section 96(h) at least authorizes and may require the Labor Commissioner to accept assignments of severance benefit claims, for the purpose of prosecuting such claims on behalf of the assignor-employee. Cal. Labor Code § 98.3. The issue is whether or not the taking of such assignments by the Commissioner and the prosecution of those ERISA claims before a competent state or federal court would affect the administration of employee benefit plans, or otherwise “relate to” such plans.

As discussed above, Congress intended ERISA to have a broad preemptive scope. ERISA has been held to preempt all state laws purporting to regulate the administration of employee benefit plans. See Carpenters Pension Trust v. Kronschnabel, 460 F.Supp. 978, 981 (C.D.Cal.1978), aff'd, 632 F.2d 745 (9th Cir.1980), cert. denied, 453 U.S. 922, 101 S.Ct. 3159, 69 L.Ed.2d 1004 (1981); Azzaro v. Harnett, 414 F.Supp. 473, 474-75 (S.D.N.Y.1976), aff'd, 553 F.2d 93 (2d Cir.), cert. denied, 434 U.S. 824, 98 S.Ct. 71, 54 L.Ed.2d 82 (1977).

Like § 98(a), § 96(h) intrudes on Congress’ delegation of the “parens patriae” function under ERISA to the Secretary of Labor. Under the act, the Secretary has plenary authority to bring civil actions including for equitable relief to redress any individual violation. 29 U.S.C. § 1132(a)(5). Again, the Congressional scheme does not contemplate that state labor commissioners should exercise a similar parens patriae function to redress asserted individual violations of ERISA’s benefits provisions by taking assignments of such claims and prosecuting them on behalf of employees.

CONCLUSION

While I recognize the salutary purpose of the disputed provisions of state law and the actions of the Labor Commissioner, I must recognize also what my brother Gadbois has aptly termed “the most sweeping preemption statute ever enacted by Congress.” California Hosp. Ass’n, 569 F.Supp. at 1546. For the reasons stated herein, I hold that § 10.65 of the Operations and Procedures Manual, Chapin v. Fairchild Camera & Instrument Corp. and Cal.Labor Code §§ 98(a) & 96(h) may not be applied to severance benefit plans of employers in or affecting commerce and to severance benefit claims arising under such plans by reason of ERISA’s broad preemption provision, 29 U.S.C. § 1144(a), by virtue of the Supremacy Clause, Const, art. VI § 2.

IT IS ORDERED that plaintiffs’ motion for summary judgment is granted and a declaratory judgment and permanent injunction in plaintiff’s favor shall be entered accordingly.

      . Patrick W. Henning was the predecessor of defendant C. Robert Simpson as Labor Commissioner of the State of California. Since defendant is being sued in his official capacity, the same party, i.e., the Labor Commissioner, is a party to both actions, as is the CCC.

      . Other aspects of this case are reported at 569 F.Supp. 1544.

      . Cal.Labor Code § 98(a) provides, in part:
      The Labor Commissioner shall have authority to investigate employee complaints. The Labor Commissioner may provide for a hearing in any action to recover wages, penalties, and other demands for compensation properly before the division or the Labor Commissioner ... and shall determine all matters arising under his or her jurisdiction ... Within 30 days of filing the complaint, the Labor Commissioner shall notify the parties as to whether a hearing will be held within a reasonable period of time, or whether action will be taken in accordance with Section 98.3, or whether no further action will be taken on the complaint. However, the Labor Commissioner may postpone or grant additional time before setting a hearing if the Labor Commissioner finds that such would lead to an equitable and just resolution of the dispute.

      . It is unnecessary to determine whether the Labor Commissioner is the functional equivalent of a "State court” under 28 U.S.C. § 1441(a) for removal purposes. See Floeter v. C. W. Transport, Inc., 597 F.2d 1100 (7th Cir.1979).

      . Cal.Labor Code § 15 ("shall” is mandatory).