author: HODGE, J.,

text:
    Lee v. Booher

      Jean K. Perkins, for plaintiffs

      Norman J. Barilla, for defendant Gloria Brothers
    August 7, 2013
   HODGE, J.,

This opinion is issued pursuant to Rule 1925(a) of the Pennsylvania Rules of Civil Procedure in support of the order of court dated June 18, 2013.

The plaintiffs, Christina Ann Lee and Marvin Ezra Lee (hereinafter, “plaintiffs”) initiated the instant action by filing a complaint for custody in the Court of Common Pleas of Lawrence County, Pennsylvania on April 8,2013. Plaintiffs are the paternal aunt and uncle of the minor child, Charity Demure Booher, bom November 15, 2007. In their custody complaint, plaintiffs named Clifford Dari Booher, Tashina Chanel Booher and Gloria Brothers as defendants. Clifford Dari Booher (hereinafter, “father”) is the natural father of the minor child. Tashina Chanel Booher (hereinafter, “mother”) is the natural mother of the minor child. Gloria Brothers (hereinafter, “maternal grandmother”) is the maternal grandmother of the minor child.

Maternal grandmother was served with a copy of the complaint on April 11, 2013. Forty-eight days later, on May 29, 2013, maternal grandmother filed preliminary objections challenging venue and the legal sufficiency of the pleadings. A custody conciliation conference was subsequently held on June 3, 2013. Following the conference, this court entered an order on June 18, 2013, which provided Plaintiffs with temporary primary custody and sole legal custody of the minor child. Mother and maternal grandmother were awarded partial custody rights on two weekends out of every three weekends. Father is currently incarcerated at the Allegheny County Jail in Pittsburgh, Pennsylvania. Father was not awarded custody for this reason.

On June 7, 2013, maternal grandmother presented a petition for emergency relief asking this court to stay further proceedings in Lawrence County, Pennsylvania pending a erred in granting plaintiffs standing in the instant case, without an evidentiary hearing to determine whether plaintiffs can established in loco parentis status.

Section 5324 of the Pennsylvania Domestic Code sets forth the requirements to obtain standing in a custody contest. Section 5324 provides:

The following individuals may file an action under this chapter for any form of physical custody or legal custody:
(1) A parent of the child.
(2) A person who stands in loco parentis to the child.
(3) A grandparent of the child who is not in loco parentis to the child:
(i) whose relationship with the child began either with the consent of a parent of the child or under a court order;
(ii) who assumes or is willing to assume responsibility for the child; and
(iii) when one of the following conditions is met:
(A) the child has been determined to be a dependent child under 42 Pa.C.S. Ch. 63 (relating to juvenile matters);
(B) the child is substantially at risk due to parental abuse, neglect, drug or alcohol abuse or incapacity; or
(C) the child has, for a period of at least 12 consecutive months, resided with the grandparent, excluding brief temporary absences of the child from the home, and is removed from the home by the parents, in which case the action must be filed within six months after the removal of the child from the home.

23 Pa.C.S.A. §5324.

As a general rule, third parties (other than grandparents) do not have standing to participate in child custody actions. Morgan v. Weiser, 923 A.2d 1183, 1186 (Pa. Super. 2007). An exception exists, however, which permits a third party to maintain an action for custody, where the third party stands in loco parentis to the child. Id. at 1002.

“The phrase Hn loco parentis’ refers to a person who puts oneself in the situation of a lawful parent by assuming the obligations incident to the parental relationship without going through the formality of a legal adoption. The status of in loco parentis embodies two ideas; first, the assumption of a parental status, and, second, the discharge of parental duties.”

T.B. v. L.R.M., 786 A.2d 913, 916-17 (Pa. 2001).

Our courts have recognized that the child’s best interest requires that one who is in loco parentis be granted standing so as to have the opportunity to fully litigate the issue of whether that relationship should be maintained, even over a natural parent’s objections. J.A.L. v. E.P.H., 682 A.2d 1314, 1320 (Pa. Super. 1996). Standing will be found where the child has established strong psychological bonds with a person who, although not a biological parent, has lived with the child and provided care, nurture, and affection, assuming in the child’s eye a stature like that of a parent. Id.; see also, J.A.L. v. E.P.H., 682 A.2d 1314, 1319-20 (1996)).

Upon review of the record, the court concludes that maternal grandmother has filed a notice of appeal to the Superior Court of Pennsylvania before this court, which could hold an evidentiary hearing to address maternal grandmother’s second preliminary objection, challenging plaintiffs’ standing in the instant action. In the Court of Common Pleas of Lawrence County, upon filing the initial complaint in custody, a custody conciliation conference is promptly scheduled before the custody conciliation officer, pursuant to Rule 1915.4 (a) and 1915.4-3. Plaintiff’s complaint was filed on April 8,2013, and a conference was scheduled for June 3,2013. As previously stated, maternal grandmother filed her preliminary objections on May 29, 2013. Although maternal grandmother’s preliminary objections are untimely, the court acknowledges the issue of standing cannot be waived and scheduled argument for August 9, 2013. Pending argument on maternal grandmother’s preliminary objections, this court entered a temporary custody order that reflected the status quo established between the parties.

For the reasons set forth above the court believes that maternal grandmother’s appeal is premature. The temporary custody order issued on June 18, 2013 should remain in effect until this court has the opportunity to address the merits of maternal grandmother’s objections.

ORDER OF COURT

And now, this 7th day of August, 2013, with the court having received plaintiffs’ concise statement of errors complained of on appeal and issuing a supplemental opinion in support of the order of court issued on June 18, 2013, pursuant to Pa.R.App.P. 1925(a)(2)(h), the court hereby directs the Prothonotary of Lawrence County to assemble the record and transmit the same to the prothonotary of the Superior Court as required by the applicable rules of appellate procedure.

The prothonotary is further directed to file the attached correspondence of record and serve notice said correspondence along with a copy of this order of court and attached opinion upon counsel of record for the parties and upon any unrepresented party at their last known address as contained in the court’s file.


source: Caselaw Access Project

author: HIGGINS, J.,

license: Public Domain

text:
    Leibig v. Leibig

      Jane Roach Maughan, for plaintiff.

      Brian J. Cali, for defendant.
    August 7, 2013
   HIGGINS, J.,

This matter is before the court on defendant Steven C. Leibig’s (hereinafter referred to as “defendant”) exceptions from the support master’s determination for an award of alimony pendente lite (APL). Previously, defendant’s income was established at $8,395.27 per month. Plaintiff Ardis L. Leibig (hereinafter referred to as “plaintiff’) was previously imputed an income of $3,064.66 per month which resulted in a monthly APL payment to plaintiff of $2,132.24. APL was terminated on April 30,2012, pursuant to the February 24, 2012 order of court. On November 9,2012, plaintiff filed a petition for modification of support order. After a support conference, a support master’s hearing was requested and held on January 31, 2013. This court made the support master’s recommendations an order of court, which was filed on March 4, 2013. Defendant filed exceptions to the support master recommendations on March 15,2013. Oral arguments were heard by the court on May 6,2013 and we are now prepared to dispose of defendant’s exceptions.

The parties were married on September 18, 2007, and no children were bom of the marriage. In January of 2011, the parties separated. Plaintiff filed a divorce complaint on April 6, 2011. A prior order for APL was issued in this matter which terminated on April 30, 2012. A hearing was held before the support master, after which a second order for APL was entered requiring defendant to pay the sum of $996.00 per month to plaintiff until a final decree in divorce is entered or September 1, 2013, whichever occurs first.

When evaluating the merits of the parties’ exceptions, we must first examine the master’s report. Our function is to review the master’s factual findings to determine if the recommendations are appropriate. Ewing v. Ewing, 843 A.2d 1282, 1286 (Pa. Super. 2004) (citation omitted). In Pennsylvania, a “master’s report and recommendation, although only advisory, is to be given the fullest consideration, particularly on the question of credibility of witnesses, because the master has the opportunity to observe and assess the behavior and demeanor of the parties .” Moran v. Moran, 839 A.2d 1091, 1095 (Pa. Super. 2003). However, a master’s report “is advisory only... and the reviewing court is not bound by it and it does not come to the court with any preponderate weight or authority which must be overcome.” Rothrock v. Rothrock, 765 A.2d 400, 404 (Pa. Super. 2000) (citation omitted). We will, however, affirm the master if his recommendations are supported by the record.

In his exceptions, defendant argues that the support master erred in reinstating APL and, if properly re-instated, plaintiff’s imputed income is res judicata. At the outset, we note that a person’s support obligation is determined primarily by the parties’ actual financial resources and their earning capacity. Hoag v. Hoag, 435 Pa. Super. 428, 646 A.2d 578 (1994). Although a person’s actual earnings usually reflect his earning capacity, where there is a divergence, the obligation is determined more by earning capacity than actual earnings. See DeMasi v. DeMasi, 408 Pa. Super. 414, 597 A.2d 101 (1991). Earning capacity is defined as the amount that a person realistically could earn under the circumstances, considering his age, health, mental and physical condition, training, and earnings history. Gephart v. Gephart, 164 A.2d 613 (Pa. Super. 2000).

The Uniform Support Guidelines (“the Guidelines”) are found in Rules 1910.16-1 et. seq. of the Pennsylvania Rules of Civil Procedure. The Pennsylvania Supreme Court has made clear that the amount of support recommended by the Guidelines is strongly favored:

Rule 1910.16-1 explicitly states that the amount of support, whether it be child support, spousal support or alimony pendente lite, shall be determined in accordance with the support guidelines which consist of not only the grids set forth in Rule 1910.16-2 and the formula set forth in Rule 1910.16-3, but also Rule 1910.16-5 which discusses in detail the operation of the guidelines.

Ball v. Minnick, 648 A.2d 1192, 1195-96 (Pa. 1994). “APL is based on the need of one party to have equal financial resources to pursue a divorce proceeding when, in theory, the other party has major assets which are the financial sinews of domestic warfare.” DeMasi v. DeMasi. 597 A.2d 101, 104 (Pa. Super. 1991). “An award of alimony pendente lite may be modified or vacated by a change in circumstances.... It is the burden of the party seeking to modify an order of support to show by competent evidence that a change of circumstances justifies a modification.” Id. at 388.

In plaintiff’s petition for modification of support order she avers that she filed her petition to effect collection of arrears and re-instate the APL order. Plaintiff did not allege a change in circumstances and therefore, we believe that her imputed income should remain at the higher rate. After plaintiff voluntarily left her higher paying employment, she then accepted lower paying employment. Accordingly, we believe her earning capacity is properly set at the higher paying level. Although plaintiff argues that she should not be imputed this income indefinitely, research of caselaw has not revealed any precedent which establishes any time period for imputing an income. We are not concerned why plaintiff left her position as service manager at Abeloff Nissan, however, we believe that her voluntary resignation in conjunction with the short term of the marriage leads us to conclude that plaintiff should be imputed a higher income for purposes of APL. Additionally, we find no competent evidence that plaintiff experienced a change of circumstances.

In regard to the award of additional APL, we see no error by the support master in continuing APL to allow plaintiff to pursue the divorce action. After reviewing the evidence submitted at hearing we find that the master’s conclusion regarding plaintiff’s income is not supported by the record and applicable law. Accordingly, defendant’s exception will be granted and this matter will be remanded back to the Domestic Relations Office for calculations of APL using the imputed income for plaintiff

ORDER

And now, this 7th day of August 2013, upon consideration of defendant’s exceptions to the master’s support recommendation and the response thereto, it is hereby ordered that defendant’s exceptions are granted. It is further ordered that this matter is remanded back to the Domestic Relations Office for calculations of APL using the imputed income for plaintiff.


author: MCINERNEY, J.,

text:
    Wooden v. Highmark, Inc.

      David S. Senoff, Lauren C. Fantini and William R. Caroselli, for plaintiffs.

      Samantha L. Southall, Jack M. Stover, Jayson R. Wolfgang and Craig D. Mills, for defendant.
    August 8, 2013
   MCINERNEY, J.,

Plaintiffs, Herman Wooden and Thomas Logan, are former corporate members of defendant, Highmark, Inc., a Pennsylvania non-profit, Blue Cross/Blue Shield corporation. In this action, plaintiffs ask the court to find that Highmark’s accumulation of $1.2 billion in profits over the period 2005-2009 was improper in light of its nonprofit status. Plaintiffs’ argument is logical and compelling. However, the judiciary is not the proper arm of government to restrain this particular charity’s acquisitiveness. The legislature, which enacted the statutes governing nonprofits and insurance companies, and the executive branch, which regulates such entities under the statutes, are the ones who must say whether the accumulation of substantial profits by a nonprofit health insurer is improper.

According to its Articles of Incorporation, Highmark was incorporated to do the following:

establish, maintain and operate one or more nonprofit hospital plans, professional health service plans, health maintenance organizations, preferred provider organizations or other health care or employee benefits services, plans or organizations and to provide subscribers and customers of such services, plans or organizations with hospitalization, medical, health care and other benefits and services.

The articles also contemplate that Highmark will participate in the federal Medicare Program, which provides healthcare to older and disabled Americans. The articles further state that “[t]he Corporation does not contemplate pecuniary gain or profit, incidental or otherwise, to its members or other individuals.”

Highmark operates both a nonprofit hospital plan, or Blue Cross Plan, and a nonprofit professional health service plan, or Blue Shield Plan. In order to operate such Blue Plans, Highmark must satisfy the criteria of the national Blue Cross/Blue Shield organization, as well as local state insurance statutes. According to the parties, the national organization no longer requires that its licensees be nonprofit entities. However, the Commonwealth of Pennsylvania still does. Specifically, the state’s Health Plan Corporations Act (“HPCA”) provides:

A corporation not-for-profit incorporated for the purpose of establishing, maintaining and operating a nonprofit hospital plan shall not commence business until it shall have received from the [Insurance] department a certificate of authority authorizing the corporation to establish, maintain and operate such a nonprofit hospital plan.
* * *
A corporation not-for-profit incorporated for the purpose of establishing, maintaining and operating a nonprofit professional health service plan, nonprofit dental service plan or nonprofit optometric service plan shall not commence business until it shall have received from the [Insurance] department a certificate of authority authorizing the corporation to establish, maintain and operate a nonprofit professional health service plan, a nonprofit dental service plan or a nonprofit optometric service plan, as the case may be.

In other words, only a nonprofit corporation is eligible to receive the requisite certificate of authority to operate a Blue Plan in this state. For-profit corporations are excluded because, in Pennsylvania, Blue Cross/Blue Shield entities are viewed as “charitable and benevolent institutions” and are afforded tax exempt status, as follows:

Every hospital plan corporation holding a certificate of authority under this chapter is hereby declared to be a charitable and benevolent institution, and all its funds and investments shall be exempt from taxation by the Commonwealth and its political subdivisions.
Every professional health service corporation holding a certificate of authority under this chapter is hereby declared to be a charitable and benevolent institution, and all its income, funds, investments and property shall be exempt from all taxation by the Commonwealth or its political subdivisions.

Furthermore, the Legislature has made clear in HCPA that it views nonprofit Blue Plan entities like Flighmark as providers of necessary social services:

It is hereby declared to be the purpose and intent of this chapter and the policy of the General Assembly to authorize qualified persons to provide adequate professional health services for residents of this Commonwealth who are unable to provide such services for themselves or their dependents at their own cost without depriving themselves or their dependents of such necessaries of life as food, clothing and shelter, and provide persons of over-income with the limited professional health services benefits set forth in this chapter.

Nonprofit entities that offer Blue Plans, such as Highmark, are subject to regulation and supervision by the Pennsylvania Insurance Department, the Department of Health, and the Department of State. Specifically, Highmark must submit annual financial reports to the Insurance Department, and it is subject to financial examination by the Insurance Department eveiy three years.

In addition to operating Blue and Medicare Plans directly, Highmark also owns several for-profit subsidiaries that are engaged in providing health related services. During the five years at issue here, 2005-2009, plaintiffs claim that Highmark and its subsidiaries planned for and generated more than $1.2 billion in net profits. During this same period, Highmark paid approximately $58 million to its top twelve executives, which amount included substantial profit-based bonuses. Highmark retained the remainder of its profits and invested them in its for-profit subsidiaries and its traditional investment portfolio. Plaintiffs object that a nonprofit should not be permitted to accumulate and distribute excess profits in these ways, but should instead use them for socially beneficial purposes.

In making this argument, plaintiffs point to several provisions of the Nonprofit Corporation Law (“NCL”), which applies to Highmark because HCPA requires that Highmark be a nonprofit corporation. Under the NCL, a nonprofit corporation or “corporation not-for-profit” is defined as “[a] corporation not incorporated for a purpose or purposes involving pecuniary profit, incidental or otherwise.” It does not appear from Highmark’s Articles of Incorporation, that Highmark was formed for the purpose of generating profits. However, Highmark does appear to have deliberately evolved into a very profitable enterprise. It also appears that Highmark’s executive officers planned, throughout the period at issue here, to make substantial profits, and they exceeded their own expectations for Highmark and shared in that purposeful profit-making when they received bonuses tied to those profits.

Plaintiffs claim that such intentional profit mongering exceeds the powers granted to nonprofit corporations under the NCL because the law allows them to make only “incidental” profits:

A nonprofit corporation whose lawful activities involve among other things the charging of fees or prices for its services or products, shall have the right to receive such income and, in so doing, may make an incidental profit. All such incidental profits shall be applied to the maintenance and operation of the lawful activities of the corporation, and in no case shall be divided or distributed in any manner whatsoever among the members, directors, or officers of the corporation.

The plaintiffs focus their argument on the Legislature’s choice of the word “incidental,” which the plaintiffs interpret as meaning “small” or at least “not substantial.” However, the important limiting language in the above provision of the statute is not the phrase “incidental profit,” but rather the phrase “the charging of fees or prices for its services or products.” While the NCL allows Highmark to charge fees for the socially beneficial health services its provides directly to members of the public, it is not permitted to make sizeable profits from such charitable endeavors. The above provision does not prohibit Highmark from earning substantial profits from activities other than the sale of its Blue Plan services.

Highmark charges fees for its primary Blue Plan services, and it may even make some profit from the sale of such services. However, plaintiff did not produce evidence showing that the bulk of Highmark’s profits came from the fees it charged Blue Plan participants. Instead, it appears that Highmark obtained its substantial profits from its investment in its for-profit subsidiaries and from its investment portfolio. Such investments are permitted by the Nonprofit Law:

Subject to the limitations and restrictions imposed by statute and, except as otherwise provided in paragraph (4), subject to the limitations and restrictions contained in its articles, every nonprofit corporation shall have [the] power:
* * *
(4) To acquire, own and utilize any real or personal property .. .regardless of any limitation set forth in its articles prior to January 1, 1972 ...as to the amount of income derived therefrom.
* * *
(6) To ...acquire, own and dispose of ...capital stock and other securities.
* * *
(8) To invest its funds .. .

In other words, Highmark is permitted to generate income by investing its funds in the market and in its subsidiaries, and the NCL does not expressly limit the profits it may make from such investments.

In fact, as a health insurer, Highmark is required to invest its funds and to maintain reserves and a surplus, so that it can pay claims and remain viable. Under HPCA, the Commonwealth specifies the manner in which Highmark may invest its reserves and surplus:

Any statute to the contrary notwithstanding, funds of any hospital plan corporation, equal to its reserves, shall be invested in compliance with the requirements of law for the investment of the capital and reserves of life insurance companies. The funds of any such corporation, equal to its surplus, shall be invested in compliance with the requirements of law for the investment of the surplus of life insurance companies.
Any statute to the contrary notwithstanding, funds of any professional health service corporation, equal to its reserves, shall be invested in compliance with the requirements of law for the investment of the capital and reserves of life insurance companies. The funds of any such corporation, equal to its surplus, shall be invested in compliance with the requirements of law for the investment of the surplus of life insurance companies

Furthermore, under HPCA, the Department of Insurance is charged with regulating the amount of such investments:

A professional health service corporation shall at all times while engaged in business maintain reserves, in such form and amount as the [Insurance] department may determine, to insure its subscribers against loss through the failure of the corporation to provide the services agreed to in its contracts.

In order to determine whether Highmark is financially healthy, the Insurance Department looks at Highmark’s percentage of risk based capital (“RBC”). Apparently, under the Affordable Care Act, an RBC of only 250% is deemed sufficient, and the national Blue Cross/Blue Shield Association requires an RBC of only 375%. However, the Insurance Department has expressly determined “that an appropriate sufficient operating surplus range ...is 550% — 750% for ...Highmark.” For the years 2005-2009, when Highmark was accumulating profits of $1.2 billion, Highmark’s RBC was between 662% — 734%, well within the range set by the Insurance Department.

The Insurance Department is charged with overseeing Highmark’s financial health and necessarily has greater expertise in insurance matters than this court. Since the department has found Highmark’s RBC percentages “appropriate” and “sufficient”, and not “inefficient,” the court must defer to the department’s findings that Highmark has not accumulated excessive capital surplus as a result of its generation and investment of substantial profits during the 2005-2009 period.

Plaintiffs also challenge Highmark’s payment of substantial, profit based, bonuses to its top executives. The NCL specifically provides that “[a] nonprofit corporation shall not pay dividends or distribute any part of its income or profits to its members, directors, or officers.” However, in the next breath, the Legislature provided that “[a] nonprofit corporation may pay compensation in a reasonable amount to members, directors, or officers for services rendered.” The statute also gives nonprofit corporations the power:

(14) To pay pensions and establish pension plans, pension trusts, profit sharing plans, share bonus plans, share option plans, incentive and deferred compensation plans and other plans or trusts for any or all of its present or former representatives and, after their death, to grant allowances or pensions to their dependents or beneficiaries, whether or not the grant was made during their lifetime.
* * *
(16) To elect or appoint and remove officers, employees and agents of the corporation, define their duties, fix their reasonable compensation and the reasonable compensation of directors, to lend any of the foregoing money and credit and to pay bonuses or other additional compensation to any of the foregoing for past services.

Plaintiffs have offered no evidence, expert or otherwise, to show that the salaries and benefits, including substantial profit-based bonuses, that were paid to Highmark executives were unreasonable. Instead, the evidence shows that the Insurance Department examined the bonuses and other compensation earned by Highmark executives for the years 2004-2008 and found them to be to be reasonable.

Although plaintiffs and the public may look aghast at the high level of compensation paid to the executives of this supposedly “nonprofit” corporation, the court cannot find such payments to be unreasonable based upon outrage alone. The only evidence presented in this case indicates that Highmark’s executive compensation, including substantial profit-based bonuses, is reasonable, at least among the rarified ranks of health insurance executives. Therefore, plaintiffs cannot proceed to trial on their claim that Highmark has improperly distributed its profits to its executives by paying them such bonuses.

CONCLUSION

For all the foregoing reasons, the court must deny plaintiffs’ motion for summary judgment and grant highmark’s motion for summary judgment.

ORDER

And now, this 8th day of August, 2013, upon consideration of the parties’ cross-motions for summary judgment, the responses thereto, and all other matters of record, after hearing oral argument thereon, and in accord with the opinion issued simultaneously, it is ordered as follows:

1. Plaintiffs’ motion for partial summary judgment is denied;
2. Defendant’s motion for summary judgment is granted;
3. Judgment is entered for defendant and against plaintiffs on plaintiffs’ claims; and
4. The parties’ motions in limine are dismissed as moot.

      . Plaintiffs ceased to be members of Highmark in May, 2009, when the members voted to limit membership to just directors of Highmark. Since the directors of Highmark previously approved Highmark’s accumulation of profits, they are unlikely to bring any challenge similar to plaintiffs’ in the future.

      . Articles of Incorporation of Highmark, Inc., Art. Ill, (3)(a), attached to plaintiffs’ motion for partial summary judgment as exhibit B.
      A Highmark PPO Insurance Plan is available to many employees of the Commonwealth of Pennsylvania, including the undersigned and other members of the judicial, legislative, and executive branches.
        See www.pebtf.org/Active/PlanMap (Website of the Pennsylvania Employees Benefit Trust Fund, which administers health care benefits to eligible Commonwealth of Pennsylvania employees, retirees and their dependents.)

      . Articles of Incorporation of Highmark, Inc., Art. Ill, (3)(d).

      . Id., Art. IV.

      . These plans were originally operated by separate entities that merged, in 1996, to form Highmark. See Capital BlueCross v. Pennsylvania Ins. Dep’t, 937 A.2d 552 (Pa. Commw. 2007)

      . 40 Pa. Cons. Stat. § 6102(a).

      . 40 Pa. Cons. Stat. § 6304(a).

      . See Capital BlueCross, 937 A.2d at 572 (“Blue plans are required to be nonprofit corporations.”)

      .40 Pa. Cons. Stat. § 6103(b).

      . Id. § 6307(b).

      . Id. § 6303(b).

      . See 40 Pa. Cons. Stat. §§ 6125, 6307(a), 6329, 6331, 6332. See also Capital BlueCross, 937 A.2d at 572 (Nonprofit Corporation Law, which governs Blue Plans, is “administered by the Department of State, not by the Department of Insurance.”)

      .40 Pa. Cons. Stat. §§ 6125, 6331.

      . In arriving at this rough figure, the court relied upon Highmark’s executive compensation charts for 2004-2008 contained in the Insurance Department’s 2009 Report of Limited-Scope Examination of Independence Blue Cross Philadelphia, PA and Highmark Inc. Pittsburgh, PA Executive Compensation (hereinafter “Insurance. Department’s 2009 Report”), which is attached to Highmark’s motion for summary judgment as exhibit 29.

      . Expert report of Stephen J. Scherf, CPA, p. 10 (February 24, 2013) (hereinafter “First Scherf Report”), which is attached to plaintiffs’ response to Highmark’s motion for summary judgment as exhibit 5. For the purposes of deciding the parties’ cross-motions for summary judgment, the court has relied upon those facts that are undisputed and has accepted as true plaintiffs’ version of disputed facts, including those set forth in its experts’ reports.

      . It is not entirely clear from their pleadings and other papers what plaintiffs would like Highmark to do with its extra profits, but the court will assume plaintiffs’ motives here are pure.

      . 15 Pa. Cons. Stat. Ann. § 5103. By contrast, a “Corporation for profit” is “A corporation incorporated for a purpose or purposes involving pecuniary profit, incidental or otherwise, to its shareholders or members.” Id.

        . Id. at § 5545.

      . “Incidental” has several meanings; it can be something “accidental,” “unpredictable,” or “minor, casual, or subordinate.” American Heritage Dictionary, p. 912 (3d ed. 1992).

      . For the years 2005 — 2009, Highmark claims that it made a profit from the sale of its insurance products and services the first two years and sustained losses the last three years, for a combined total loss of over $93 million. See Highmark’s Motion for Summary Judgment, ¶¶ 25-26.

      . 15 Pa. Cons. Stat. Ann. § 5502(a).

      . See Insurance Department’s determination and order of February 9, 2005, at p. 10, which is attached to Highmark’s motion for summary judgment as exhibit 23 (hereinafter “Insurance Department’s 2005 Determination”) (“At its most basic level, surplus represents a backstop of capital to ensure that unforeseen contingencies do not render a Blue Plan unable to meet its obligations to its policyholders. Surplus also funds the growth needs of Blue Plans.”)

      .40 Pa. Cons. Stat. § 6123.

      . Id. § 6330.

      . Id. §6321.

      . See First Scherf Report, p. 8.

      . Insurance Department’s 2005 Determination, p. 37.

      . See First Scherf Report, p. 8. During the 2005-2009 period, the Insurance Department regularly found Highmark to be operating “sufficiently,” which means it was well-capitalized, but not overcapitalized. See Insurance Department’s Annual Statements of Surplus Levels for Blue Plans, which are attached to Highmark’s Motion for Summary Judgment at Exhibit 24.

      . See Insurance Department’s 2005 Determination and order, p. 9 (“In enacting HPCA, the General Assembly recognized that the. Department is uniquely qualified to assess the reserve and surplus levels of the Blue Plans in Pennsylvania, a qualification upheld by our courts.”)

      . See id. at p. 37 (“When a Blue Plan is above its sufficient surplus operating range, and thus outside the continuum of efficient levels of surplus, it has accumulated surplus at an economically inefficient level that is likely inconsistent with the Blue Plans’ status as statutory nonprofit, charitable and benevolent institutions.... In such instances, the Department will require the Blue Plan to justify its surplus level, or if its surplus level is excessive, provide a plan to the Department illustrating how it will reduce its surplus level back to within its sufficient surplus operating range over a reasonable period of time.”)

      . See Pennsylvania Human Relations Comm’n v. Norristown Area Sch. Dist., 473 Pa. 334, 349, 374 A.2d 671, 679 (1977) (“An administrative agency has available two methods for formulating policy that will have the force of law. An agency may establish binding policy through rulemaking procedures by which it promulgates substantive rules, or through adjudications which constitute binding precedents.”) Since the Insurance Department’s 2005 Determination and order constitutes binding precedent, this court must follow it.

      . 15 Pa. Cons. Stat. Ann. § 5551 (a).

      . Id. at § 5551(b).

      . 15 Pa. Cons. Stat. Ann. § 5502(a).

      . While the years at issue here are 2005-2009, there is no evidence that executive earnings during that period were substantially different than during the 2004-2008 period.

      . Insurance Department’s 2009 Report, p. viii (“Because the annual compensation of the Highmark and IBC executives is similar to that paid to executives of other Blue Cross companies of similar size, that compensation is reasonable. The compensation of the Highmark and IBC CEOs is substantially less than the compensation of the CEOs of the leading for-profit health insurers.”)


author: HERTZBERG, J.,

text:
    Murry v. Curotola

      Susan E. Mahood, for plaintiff.

      Daniel P Buzará, for defendants.
    August 20, 2013
   HERTZBERG, J.,

Plaintiff Susan Murry (“Ms. Murry”) paid defendant Lawrenceville Motors $1,500 for a used car, but three months later the police seized the car from her because it had been reported as stolen. Defendant Joseph Curotola (“Mr. Curotola”), agent for Lawrenceville Motors, signed the application to transfer title to Ms. Murry, certifying that Lawrenceville Motors could sell the car. Mr. Curotola now appeals to the Superior Court of Pennsylvania from my non-jury verdict against him in the amount of $2,411.50, and this opinion provides the reasons for my verdict. See Pa. R.A.P. No. 1925(a).

This confusing story begins in August of 2006 when Evelyn Stanton (“Ms. Stanton”) purchased the car, a 1996 Buick Regal, from Roland’s Auto Sales (“Roland’s”) via an installment payment plan. When Ms. Stanton did not make payments, Roland’s sued her in December of 2006 and repossessed the car. The State Police listed the car as stolen on January 5, 2007, but Roland’s assigned possession and title to Lawrenceville Motors on February 8,2007. See Exhibit A. The lawsuit between Roland’s and Ms. Stanton concluded in May of2007 withRoland’s being ordered to return the car to Ms. Stanton. Lawrenceville Motors, however, maintained possession of the car, and Ms. Murry attempted to buy the car, then driven at least 140,110 miles, from Lawrenceville Motors on January 4, 2008. The police contacted Ms. Murry and informed her the car had been stolen from a previous owner, and on March 27,2008 the police came to Ms. Murry’s home and towed the vehicle away. Ms. Murry contacted Mr. Curotola and told him what had happened, but Mr. Curotola said “there was nothing they could do about it.” Transcript of non-jury trial of May 20,2013 (“T.” hereafter), p. 33.

Ms. Murry’s complaint in the captioned proceedings contains a negligence claim against the defendants for not determining that the vehicle they sold to her was stolen. The defendants filed and served Ms. Stanton with a complaint against additional defendant that averred Ms. Stanton was exclusively responsible for Ms. Murry’s damages because she falsely reported to the police that the car was stolen, when it had actually been repossessed.

I presided over the non-jury trial of the dispute on May 20, 2013. Ms. Stanton did not file a response to the complaint against additional defendant and she did not appear at trial. Five witnesses testified at trial and afterwards I entered a verdict against Lawrenceville Motors, Mr. Curotola and Ms. Stanton for $2,411.50. Lawrenceville Motors and Mr. Curotola filed a motion for post-trial relief, which I denied. Ms. Murry then entered judgment on the verdict. Mr. Curotola then filed a timely notice of appeal from the verdict and a concise statement of the errors complained of on appeal. I will address these alleged errors in chronological order rather than the order in which they appear in Mr. Curotola’s concise statement of the errors complained of on appeal.

Because Ms. Stanton failed to respond to the defendants ’ complaint against her that alleged she falsely reported the car was stolen, Mr. Curotola argues I made an error by not holding her exclusively responsible for Ms. Murry’s damages. See concise statement per PA.R.A.P. 1925(b), fno. 2. I interpret this as an argument that it was Ms. Stanton rather than Mr. Curotola who caused Ms. Murry’s losses. However, my verdict against her was based exclusively on default from her failure to file a written response or to appear at trial. The only evidence against Ms. Stanton was the official record from Roland’s Auto Sales v. Evelyn Stanton, No. AR07-001640 in the Court of Common Pleas of Allegheny County, which fails to establish that Ms. Stanton falsely reported to the police that the car was stolen.

That record shows Ms. Stanton purchased the car from Roland’s in August of 2006 with Roland’s retaining the title as lien holder. Roland’s filed suit against Ms. Stanton with a magisterial district judge in December of2006, then appealed to the court of common pleas from judgment of $332 in its favor. Roland’s averred that Ms. Stanton had not made any installment payments that were due, it had repossessed the car and she owed it $1,445. Ms. Stanton averred in response that Roland’s did not make repairs to the car that it had contracted to make and she was entitled to get possession of the car back from Roland’s. The compulsory arbitration award dated May 21, 2007 is in favor of Ms. Stanton. It states that Roland’s did not appear at the hearing and provides Ms. Stanton with possession of the car. Neither party appealed this award, therefore it is a final judgment giving Ms. Stanton legal title to the car. 75 Pa.C.S. §§1114(a) and 1106(c).

Mr. Curotola established that the Department of Transportation entered the stolen status on to its record of the car on January 5, 2007, the car was towed from Ms. Murry’s residence on March 27,2008 and the Department of Transportation listed the car as recovered on March 27, 2008. Only a police department may report to the State Police that a car was stolen, which results in the Department of Transportation recording it as stolen. See 75 Pa. C.S. §7113. But, there was no evidence presented at the trial of any communication by Ms. Stanton to the City of Pittsburgh Police, hence no evidence that when Roland’s repossessed the car she falsely reported to the police that it was stolen. See testimony of Corporal Scott, T., pp. 65-67. There are ways other than Ms. Stanton making a false report for the car to have been listed by the Department of Transportation as stolen. For example, the police or Ms. Stanton’s insurer may have decided to make the stolen car report. Therefore, Mr. Curotola’s claim that Ms. Stanton’s false report to the police that the car was stolen was the exclusive cause of Ms. Murry’s loss has no merit.

Mr. Curotola’s argument that Ms. Stanton was the exclusive cause of Ms. Murry’s losses also requires analysis of the “factual cause” of harm. See Restatement (Third) of Torts, Chapter 5. Assuming the liability by default of Ms. Stanton establishes that she was a cause of harm, Mr. Curotola’s conduct also is a factual cause if the harm would not have occurred absent his conduct. Id., section C. If Mr. Curotola had complied with Pennsylvania law and applied for a certificate of title to the car within six months of Lawrenceville Motors purchasing it (further explained below), he would have found the vehicle was reported stolen and known he could not sell it to Ms. Murry. Since Ms. Murry would then not have been harmed absent Mr. Curotola’s conduct, it is a factual cause sufficient to impose liability. It is Ms. Stanton’s allegedly improper conduct, occurring eleven months before Ms. Murry dealt with Mr. Curotola, that is more remote from the harm than the conduct of Mr. Curotola. Therefore, if any conduct could be argued as “too far removed from the transaction,” (Salvatore v. State Farm, 2005 PA Super 63, 869 A.2d 511, 515), it is that of Ms. Stanton. Accordingly, Ms. Stanton is not exclusively responsible for Ms. Murry’s damages, and I made no error by finding Mr. Curotola also responsible.

Mr. Curotola also alleges I made an error in my verdict because Ms. Murry did not provide evidence to support the averment in the complaint that Mr. Curotola was an owner, officer, stock-holder and/or managing agent of Lawrenceville Motors. See concise statement per PA. R.A.P. 1925(b), ¶]10. 1. Mr. Curotola testified that he was an independent contractor for Lawrenceville Motors, but I find this testimony is not credible. Ms. Murry testified credibly that she did not know Mr. Curotola’s position with Lawrenceville Motors, but that he was the individual she dealt with when she purchased the car. T.pp. 33 and 47. Mr. Curotola’s real position with Lawrenceville Motors, however, does not matter, because he was the authorized agent of Lawrenceville Motors who signed the Temporary Registration that contained this statement: “1/ WE CERTIFY THAT I/WE HAVE EXAMINED AND SIGNED THIS FORM AFTER ITS COMPLETION AND THAT THE INFORMATION GIVEN IS TRUE AND CORRECT.” Exhibit P-2.

This certification by Mr. Curotola was incorrect as the temporary registration listed Lawrenceville Motors as the Seller when only the true owner, Evelyn Stanton, could sell the car. Had Mr. Curotola abided by the Pennsylvania Motor Vehicle Code and applied for a certificate of title to the car six months after its purchase (see 75 Pa.C.S. § 1113), he would have known it was reported by the police as a stolen car. While Dominic Curotola, Mr. Curotola’s father, testified that Mr. Curotola had no responsibility for title issues, this testimony was not credible. In fact, neither Mr. Curotola nor Dominic Curotola, the owner of Lawrenceville Motors, ever identified an individual who had responsibility for title issues. Because Mr. Curotola was the only individual identified as responsible for preparing the paperwork for Lawrenceville Motors that is required by the Department of Transportation for transferring car titles, I find Mr. Curotola was responsible for title issues. In any event, by signing the temporary registration containing the certificate quoted above, Mr. Curotola accepted responsibility for title issues. If Mr. Curotola had exercised reasonable care by applying for a certificate of title six months after its purchase, he would have been notified the car was stolen. See 75 Pa.C.S. §§7113, 7114 and 1104, testimony of Pennsylvania State Police Corporal Fred Alex Scott at T., pp. 61-62 and testimony of Penndot representative Craig comp at T., pp. 97-98.

By signing the certification in the temporary registration, Mr. Curotola also warranted that “the title conveyed shall be good, and its transfer rightful....” 13 Pa. C.S. §2312(a) (l). This warranty of good title to personal property is the same as that given by warrantors of title to real estate. Frank v. McCafferty Ford Company, 192 Pa. Super 435, 161 A.2d 896 (1960). Mr. Curotola breached this warranty because the car was not owned by Lawrenceville Motors.

Mr. Curotola argues, citing Estate of Duran, 692 A.2d 176 (Pa. Super. 1997), that as an agent for a disclosed principal, he is not personally liable on a contract between the principal and a third party. The liability of Mr. Curotola, however, is not based upon him being a party to a contract. It is based on his negligence or his breach of warranty. Under either of these theories, Mr. Curotola does not escape liability because he was acting as an agent for a disclosed principal. Mr. Curotola’s entire argument is premised on the distinction between him being an agent versus an employee of Lawrenceville Motors. This argument could be made against Lawrenceville Motors being vicariously liable for Mr. Curotola’s actions. See, e.g., Juarbe v. City of Philadelphia, 431 A.2d 1073 at 1075-76 (Pa. Super. 1981). However, since Lawrenceville Motors has not appealed from the verdict against it, whether it is vicariously liable for Mr. Curotola’s actions is meaningless. Since there is no issue of vicarious employer liability and no breach of contract claim, Mr. Curotola’s allegation that he was an agent for a disclosed principal does not shield him from liability.

In summary, my verdict against Mr. Curotola was not erroneous as there was abundant evidence of his participation in the sale of the car to Ms. Murry.

      . This was the total paid by Ms. Murry for the car’s purchase price, sales tax, title fee, registration fee and repair expenses.

      . I am puzzled about why a portion of the car’s title history shows Ms. Stanton signing to transfer title back to Roland’s on January 5, 2007. See Exhibit A. With Roland’s listed on the certificate of title as first lien holder and repossession of the car, Roland’s did not need Ms. Stanton’s signature for a transfer. 69 RS. §623D; 13 Pa.C.S. §§9609 and 9610. On January 5, 2007, Roland’s and Ms. Stanton were engaged in litigation over the car, and it is not logical that Ms. Stanton would fight (and ultimately win) Roland’s repossession in court and at the same time voluntarily sign the title to Roland’s..

      . The defendants also held the car for resale but did not provide a notice (form MV 27-A or B) to the Department of Transportation within seven days, which is an additional violation of 75 Pa.C.S.§1113. Pennsylvania State Police Corporal Fred Alex Scott testified that he did not know whether the filing of a form MV 27-A or B by Lawrenceville Motors would have resulted in a notice to Lawrenceville Motors that the car was reported stolen. X, pp. 59-62. Therefore, there is not enough evidence that this additional violation of 75 Pa.C.S. §1113 caused any loss to Ms. Murry.
      The defendants argue 75 Pa.C.S.§ 1113 is inapplicable because the car was “repossessed upon default....” 75 Pa.C.S.§113(d). The defendants, however, are incorrect because this exception from the coverage of 75 Pa.C.S.§1113 applies only to the dealer who repossessed the car, which was not Lawrenceville Motors.

      . My finding that Dominic Curotola is not credible is based on his general demeanor and several instances of credibility problems during his testimony. For example, while his son testified Lawrenceville Motors sends all car title paperwork to the Department of Transportation through a messenger, Dominic Curotola testified sometimes he just mails the paperwork himself. T., pp. 76 and 106. Dominic Curotola also testified that Lawrenceville Motors bought the car at Tri-State Auto Auction, and the Auction runs all cars through an auto check to determine whether the caris stolen. X, pp. 100-101. However, had Tri-State Auto Auction done so when title was assigned to Lawrenceville Motors on February 8,2007, it would have discovered the car was reported stolen on January 5, 2007 and called the State Police. Finally, when asked how the car had about 148.000 miles on it when Lawrenceville Motors bought it, but about 140.000 miles on it when sold to Ms. Muny about a year later (X pp. 109-110 and 118-120), Dominic Curotola’s excuses that the speedometer was broken or there was a typographical error, were not believable.

      . While Ms. Murry’s complaint does not contain a breach of warranty claim, she is not obligated to identify the legal theory underlying the complaint, that being the job of the judge. See Weiss v. Equibank, 313 Pa. Super. 446 at 453, 460 A.2d 271 at 275 (1983) citing Delconte v. Stefonick, 268 Pa. Super. 572, 408 A.2d 1151 (1979).


author: MCINERNEY, J,

text:
    First Senior Financial Group v. Suib

      Neil E. Jokelson, for plaintiff.

      Daniel P. McCarrery, for defendants American Tax & Advisory Corp. and Steven Suib.

      A. Jordan Rushie, for defendant Louis Aarons.
    August 26, 2013
   MCINERNEY, J,

I. BACKGROUND

Plaintiff First Senior Financial Group (“First Senior”) appeals from an order entered on March 8, 2011 by the late Honorable Albert Sheppard, Jr. In that order, Judge Sheppard sustained, in part, preliminary objections that: (1) dismissed Steven Suib (“Suib”) from the case in his individual capacity; (2) dismissed counts III and IV against Suib and his company, American Tax & Advisory Corp. (“ATAC”), for tortious interference with existing contractual relations and tortious interference with prospective contractual relations pursuant to the “gist of the action” doctrine; and (3) struck First Senior’s demands for punitive damages. First Senior complains Judge Sheppard erred in regard to the second and third aspects of his order. In particular, First Senior argues Judge Sheppard erred in striking counts III and IV against Suib and ATAC pursuant to the gist of the action doctrine and erred in striking First Senior’s claims for punitive damages against Suib and ATAC by striking its demands therefore at counts III and IV.

On December 23, 2010, First Senior commenced the instant action by filing a complaint against Suib, ATAC, Louis Aarons (“Aarons”), Lisa Romansichov (“Romansichov”), and William Midler (“Midler”). In the complaint, First Senior made the following averments. First Senior is in the extremely competitive industry of “educating seniors and retired individuals with regard to their personal financial savings, investments and retirement options and needs.” (Compl. ¶ 12.) Suib is the President of ATAC and a registered financial consultant. (Compl. ¶ 43.) By and through ATAC, Suib is one of First Senior’s competitors. (Compl. ¶¶ 44-45.)

Prior to and including Aarons, Romansichov, and Midler’s association with First Senior, First Senior has required all of its employees and independent contractors to sign certain agreements that contain non-compete and non-solicitation clauses. (Compl. ¶ 18.) Aarons signed such agreements in 2006 when he became an independent contractor and again in 2009 when he became an employee. (Compl. ¶¶ 19-20,25-26.) Midler signed such agreements in 2009 when he became an independent contractor and Romansichov signed such agreements in 2009 when she became an employee. (Compl. ¶¶ 21-22, 28-29.)

In February 2010, Aarons resigned from his employment with First Senior effective immediately. (Compl. ¶ 40.) In July 2010, Romansichov resigned from her employment with First Senior effective immediately. (Compl. ¶ 41.) And in November 2010, Midler terminated his relationship with First Senior effective immediately. (Compl. ¶ 42.)

After terminating their relationships with First Senior, Aarons, Romansichov, and Midler each at some point went to work for Suib and ATAC. (Compl. ¶ 46.) And based upon information and belief, it was Aarons who first went to work for ATAC and thereafter solicited Romansichov and Midler to work for ATAC at Suib’s behest while they (Romansichov and Midler) were still working for First Senior. (See Compl. ¶ 48.) Suib, however, knew or should have known that hiring Aarons, Romansichov, and Midler would result in them breaching non-solicitation and non-compete convenants they had with First Senior. (Compl. ¶ 45.)

Base on the above averments, First Senior asserted causes of action against Aarons, Romansichov, and Midler for breach of contract (count I), tortious interference with existing contractual relations (count II), and misappropriation of trade secrets (count V) and causes of action against Suib and ATAC for tortious interference with existing contractual relations (count III) and tortious interference with prospective contractual relations (count IV).

On January 31, 2011, Aarons, Suib, and ATAC filed preliminary objections to First Senior’s complaint. The preliminary objections included an objection in the nature of a demurrer based on the gist of the action doctrine. By heading, this objection sought dismissal of counts II and III. (See, e.g., defs.’ prelimin. objections mem. p. 11.) In substance, however, this objection sought dismissal of counts II, III, and IV. (See, e.g., defs.’ prelimin. objections mem. p. 12.)

Regarding the gist of the action doctrine, these defendants asserted the gist of the action doctrine precludes a party from recasting an ordinary breach of contract action into a tort action. (Defs.’ prelimin. objections mem. p. 11.) These defendants then argued: “Herein, [First Senior] alleges Aarons breached [his] employment contract by establishing a business relationship with ATAC. [First Senior’s] tortious interference claims arise out of the breach of contract claim. As such, said claims are barred by the [g]ist of the [a]ction [d]octrine.” (Defs.’ prelimin. objections mem. pp. 11-12.)

Aarons, Suib, and ATAC’s preliminary objections also included an objection in nature of a demurrer to First Senior’s requests for punitive damages. (See, e.g., defs.’ prelimin. objections mem. pp. 10-11.) In the complaint, First Senior asserted Suib and ATAC’s wrongful conduct at counts III (tortious interference with existing contractual relations) and IV (tortious interference with prospective contractual relations) was “outrageous and demonstrate[d] a reckless indifference to the interests of First Senior.” (Compl. ¶¶ 72, 76.) First Senior further asserted the conduct was “so egregious that punitive damages must be assessed...as a penalty and deterrent against such conduct in the future.” (Compl. ¶¶ 72, 76.)

In the preliminary objections, Suib and ATAC argued First Senior’s demands for punitive damages should be stricken because the complaint “[s]et[] forth no facts or circumstances alleging that the conduct of the Defendants was ‘outrageous’ because of...‘evil motive’ or that any Defendant acted with reckless indifference to the rights of [First Senior].” (Defs.’ prelimin. objections mem. p. 11.) To the contrary, Suib and ATAC asserted First Senior’s complaint “set[] forth a run of the mill business dispute between competing business interests whereby a former employee/independent contractor is now working for a competing business.” (Defs.’ prelimin. objections mem. p. 11.)

On February 22, 2011, First Senior filed a response in opposition to the preliminary objections. Regarding the gist of the action doctrine and the count against Aarons for tortious interference with existing contractual relations, First Senior argued it (count II) should not be precluded because “Aarons’ obligations to neither compete nor solicit are breaches of social policy as well [as breaches of contract] because his enticement of [First Senior’s] former employees, [Romansichov] and Midler, at the behest of [] Suib, was so reckless that contract principles are collateral.” (Pl.’s Resp. Mem. p. 15.) Regarding the counts against Suib and ATAC, First Senior argued count III for tortious interference with existing contractual relations should not be precluded “because [First Senior] has no contract with [] Suib and ATAC.” (Pl.’s Resp. Mem. p. 15.) First Senior further argued “Count III is essentially grounded and based on social policy, and not any contractual obligations owed by [] Suib/ATAC to [First Senior].” (Pl.’s resp. mem. p. 16.) First Senior made no specific response in opposition to the objection to count IV, likely because of the way the defendants had raised their objection based on the gist of the action doctrine (e.g., only including counts II and III in the heading for the objection).

Regarding punitive damages, First Senior argued “the complaint does include facts which should make the Court infer that Suib acted in such a way to make punitive damages appropriate.” (Pl.’s resp. mem. p. 12.) Specifically, First Senior pointed to its allegations that “Suib knew of the contracts which Aarons, [Romansichov], and Midler had with [First Senior]” and with that knowledge: (1) “enticed Aarons to be employed with ATAC” and (2) “directed Aarons to recruit [] [Romansichov] and Midler.” (Pl.’s Resp. mem. p. 12.) First Senior then argued:

When competitors play by the “rules of the road,” and one competitor recruits the services of another competitor’s employees, there is no foul play if that recruiting competitor has no knowledge of contractual restrictions applying over his recruits. However, when a competitor knows of such covenants, and acts contrary to the agreements between his competitor and its former employees, that conduct is reckless.

(Pl.’s resp. mem. p. 12.)

By order dated March 8,2011, Judge Sheppard disposed of the preliminary objections as discussed above. On April 2, 2013, a praecipe to settle, discontinue, and end was filed as to all the remaining defendants; that is, Aarons, Romansichov, and Midler. On April 30,2013, First Senior filed a notice of appeal from the March 8,2011 order issued by Judge Sheppard, which had ended the case as to Suib and ATAC. Following Judge Sheppard’s untimely death, the case was last assigned to this court. Accordingly, it was this court that ordered First Senior to file a Pa. R. App. P. 1925(b) statement. First Senior timely complied and makes the following complaints of error:

1. Judge Sheppard erred in his order dated March 8,2011 in dismissing count III and count IV of the complaint (which allege, respectively, a tortuous interference with existing contractual relations and a tortuous interference with prospective contractual relations) “pursuant to the ‘gist of the action’ doctrine” in that: (a) the plaintiff had no contract with defendant Steven Suib (“Suib”) and defendant American Tax & Advisory Corp. (“ATAC”); (b) count III and count IV did not arise from a contract and the duties allegedly breached were not created in any contract between plaintiff and defendants Suib and ATAC; (c) count III and count IV do not duplicate any breach of contract claim and their success does not depend on the success of any contract claim; (d) count III and count IV are not a recast of count I of the Complaint; (e) count III and count IV are essentially grounded and based on social policy and not any contractual obligations by defendants Suib/ATAC to plaintiff; and (f) the gist of the action doctrine has not been adopted by the Pennsylvania Supreme Court and as such, it is contended that it is not an appropriate doctrine under Pennsylvania law.
2. Judge Sheppard[] erred in his order of March 8,2011 striking the plaintiff’s demand for punitive damages. Punitive damages were properly pled in count III and count IV of the complaint based upon the intentional conduct alleged in those counts in the complaint. It is acknowledged that counts III and IV provide the exclusive basis for the imposition of punitive damages with respect to defendants Suib and ATAC.

(PL’s 1925(b) statement, ¶¶ 1-2.)

II. DISCUSSION

In the opinion of this court, Judge Sheppard properly struck First Senior’s demands for punitive damages against Suib and ATAC by striking its demands therefore in counts III and IV. This court, however, would not have dismissed counts III and IV pursuant to the gist of the action doctrine as there was no contractual relationship between First Senior and either Suib or ATAC.

A. Standards and Scopes of Review

“Preliminary objections in the nature of a demurrer test the legal sufficiency of the complaint.” Hykes v. Hughes, 835 A.2d 382, 383 (Pa. Super. Ct. 2003) (quotations I omitted). “The court may sustain preliminary objections only when, based on the facts pleaded, it is clear and free from doubt that the complainant will be unable to prove facts legally sufficient to establish a right to relief.” Mazur v. Trinity Area Sch. Dist., 961 A.2d 96, 101 (Pa. 2008). “For the purpose of evaluating the legal sufficiency of the challenged pleading, the court must accept as true all well-pleaded, material, and relevant facts alleged in the complaint and every inference that is fairly deducible from those facts.” Id. When an appellate court reviews an order sustaining preliminary objections in the nature of a demurrer, “the standard of review is denovo and the scope of review is plenary.” Id.

B. Punitive Damages

In Pennsylvania, “’[pjunitive damages may be awarded for conduct that is outrageous, because of the defendant’s evil motive or his reckless indifference to the rights of others.’” Hutchison v. Luddy, 870 A.2d 766, 770 (Pa. 2005), quoting Feld v. Merriam, 485 A.2d 742, 747 (Pa. 1984), quoting Restatement (Second) of Torts § 908(2) (1979). “As the name suggests, punitive damages are penal in nature and are proper only in cases where the defendant’s actions are so outrageous as to demonstrate willful, wanton or reckless conduct.” Hutchison, 870 A.2d at 770. The purpose of punitive damages is twofold. Id. The first purpose is to punish a tortfeasor for outrageous conduct. Id. The second is to deter the tortfeasor or others like him or her from similar conduct in the future. Id.

While this court would not characterize First Senior’s allegations as merely “a run of the mill business dispute between competing business interests whereby a former employee/independent contractor is now working for a competing business” as was done by Suib and ATAC, (Defs.’ prelimin. objections mem. p. 11), neither would this court say Judge Sheppard erred in striking First Senior’s demands for punitive damages against Suib and ATAC as the conduct First Senior pointed to in opposition to the preliminary objection was merely that Suib and ATAC intentionally (i.e., tortiously) interfered with the contractual relationships it had with two former employees and one former independent contractor. If First Senior’s argument was to be accepted, punitive damages would be appropriate any time a subsequent employer tortiously interferes with a non-compete or non-solicitation covenant between an employee and his or her previous employer without any individualized consideration of whether the subsequent employer’s conduct was outrageous.

In response to the objection to punitive damages, First Senior argued:

When competitors play by the “rules of the road,” and one competitor recruits the services of another competitor’s employees, there is no foul play if that recruiting competitor has no knowledge of contractual restrictions applying over his recruits. However, when a competitor knows of such covenants, and acts contrary to the agreements between his competitor and its former employees, that conduct is reckless.

(Pl.’sresp. mem. p. 12.) To be liable fortortious interference with an existing contractual relationship, one must be found to have intentionally and improperly interfered with the performance of a contract between another and a third person by inducing or otherwise causing the third person to not perform the contract. Walnut St. Associates, Inc. v. Brokerage Concepts, Inc., 982 A.2d 94, 98 (Pa. Super. Ct. 2009), citing Rest. 2d Torts § 766 (1979). That is all First Senior argued: that Suib and ATAC intentionally interfered with the contracts between First Senior and three of its former employees. But “a court may not award punitive damages merely because a tort has been committed.” McClellan v. Health Maint. Org. of Pennsylvania, 604 A.2d 1053, 1061 (Pa. Super. Ct. 1992). “Additional evidence must demonstrate willful, malicious, wanton, reckless or oppressive conduct.” Id. Such additional evidence, however, was not cited to in this case.

Moreover, this is not a case where intentional fraud has been adequately alleged. Cf. McClellan, 604 A.2d at 1061 (stating “it is difficult to picture a fact pattern which would support a finding of intentional fraud without providing proof of ‘outrageous conduct’ to support an award of punitive damages.”). Rather, this is a case where intentional interference with contractual relationships has been alleged, but no other facts have been cited as to why that conduct was reckless.

“’Reckless indifference to the interests of others’, or as it is sometimes referred to, ‘wanton misconduct’, means that ‘the actor has intentionally done an act of an unreasonable character, in disregard to a risk known to him or so obvious that he must be taken to have been aware of it, and so great as to make it highly probable that harm would follow.’” Id. (citation omitted)(emphasis added). The fact that it has been alleged a subsequent employer knows of non-compete and non-solicitation covenants between an employee and his or her previous employer, but acts contrary to them, does not in and of itself rise to the level of reckless indifference to the interests of others as that act in and of itself is not so great as to make it highly probable that harm would follow. The cited conduct just lacks that element of outrage necessary to make punitive damages appropriate. See generally Restatement (Second) of Torts § 908 cmt. b (stating that “[s]ince the purpose of punitive damages is not compensation of the plaintiff but punishment of the defendant and deterrence, these damages can be awarded only for conduct for which this remedy is appropriate — which is to say, conduct involving some element of outrage similar to that usually found in crime.”)

In sum, while an underlying tort may have been sufficiently alleged, facts sufficient to show the extreme or outrageous conduct necessary for an award of punitive damages were not cited. Accordingly, Judge Sheppard’s decision to strike First Senior’s demands for punitive damages against Suib and ATAC should be affirmed.

C. Gist of the Action Doctrine

First Senior also complains Judge Sheppard erred in dismissing the counts against Suib and ATAC for tortious interference with existing contractual relations and tortious interference with prospective contractual relations pursuant to the gist of the action doctrine primarily because First Senior had no contract with Suib or ATAC. (Pl.’s 1925(b) statement ¶ 1.) This court would not have dismissed these counts (counts III and IV) pursuant to gist of the action for that reason.

The gist of the action doctrine “is designed to maintain the conceptual distinction between breach of contract claims and tort claims.” eToll, Inc. v. Elias/Savion Adver., Inc., 811 A.2d 10, 14 (Pa. Super. Ct. 2002). To maintain this conceptual distinction, the doctrine will preclude a party from raising a tort claim “where the essence of the claim actually lies in a contract that governs the parties’ relationship.” Sullivan v. Chartwell Inv. Partners, LP, 873 A.2d 710, 718 (Pa. Super. Ct. 2005). Thus, the gist of the action doctrine will act to bar tort claims: “ 1) arising solely from the contractual relationship between the parties; 2) when the alleged duties breached were grounded in the contract itself; 3) where any liability stems from the contract; and 4) when the tort claim essentially duplicates the breach of contract claim or where the success of the tort claim is dependent on the success of the breach of contract claim.” Reardon v. Allegheny Coll, 926 A.2d 477, 486 (Pa. Super. Ct. 2007).

In this case, while the gist of the action doctrine could have served as a bar to the count against Aarons, Romansichov, and Midler for tortious interference with existing contractual relations (count II) because there were contractual relationships between these defendants and First Senior, there was no contractual relationship between First Senior and either Suib or ATAC. As such, there was no basis upon which the gist of the action doctrine would bar the claims against them for tortious interference with existing contractual relations count III) or tortious interference with prospective contractual relations (count IV), and this court would not have dismissed those counts based on gist of the action.

      . The complaint stated Midler terminated his relationship with First Senior in November 2009. A reasonable inference, however, is that First Senior meant to say November 2010 because, as will be discussed, the complaint also goes on to state that after Aarons went to work for Suib and ATAC, Aarons wrongfully solicited Midler for employment with ATAC while Midler was still an independent contractor for First Senior. (See Compl. ¶¶ 40,42,48.)

      . First Senior did not challenge Judge Sheppard’s dismissal of Suib from the action. Accordingly, any liability for count III or IV would be against ATAC only. For ease of discussion, however, we will continue to reference both Suib and ATAC below.


text:
    Penn-Hilbert v. Lehigh County Prison

      Donald P. Russo, for plaintiff

      Thomas M. Caffrey, for defendant
    September 3, 2013
   REICHLEY,«/.,

The defendant has filed a motion for summary judgment seeking demurrer on all counts of plaintiff’s complaint. This is an employment discrimination case. For the reasons set forth herein, defendant’s motion for summary judgment is granted.

Findings of Fact

Plaintiff was hired by defendant as a corrections officer on or about March 15, 1989. On January 2,2005, plaintiff was involved in an automobile accident unrelated to her employment. She suffered injuries to her shoulders and neck which caused her to be unable to return to work. According to the complete and authoritative timeline provided in the affidavit of Jane Fischer, Lehigh County Human Resources Director, from January 3,2005 through March 3, 2005, plaintiff was out of work on paid sick leave. From March 3, 2005 through March 25, 2005, plaintiff was out of work on no-pay status. On January 26, 2005, plaintiff submitted a family Medical leave request form, which was received by defendant’s human resources department on or about April 7, 2005. Under the Family Medical Leave Act (FMLA), plaintiff was entitled to twelve weeks of family medical leave for each twelve month period of active employment. Entitlement is calculated by measuring backward over a twelve month period. The FMLA request was granted and backdated to March 28, 2005. From March 25, 2005 through June 17, 2005, plaintiff was out of work on family medical leave.

According to the Lehigh County personnel policy then in effect, employees were permitted to request an annual unpaid leave of absence for up to six months. Plaintiff submitted two leave of absence requests, one on March 22, 2005, and a second on September 1, 2005. Both requests were granted. Plaintiff was out of work on a consecutive ten-month leave of absence from March 3, 2005 through Januaiy 25, 2006. For a portion of this period, plaintiff’s FMLA leave ran concurrently with the ten-month unpaid leave.

On January 26, 2006, plaintiff returned to work as a correctional officer. She worked for defendant throughout most of 2006, but continued to receive treatment for her injuries from a doctor and a chiropractor.

On December 5, 2006, plaintiff was assigned to work a shift from 11:00 p.m. through 7:00 a.m. in Housing Unit 4C. At approximately 1:30 a.m. on December 6, 2006, plaintiff was ordered to report to the Admission & Discharge Department to assist other correctional officers in completing the booking of a new female inmate who was being uncooperative. Plaintiff failed to report as ordered. As a result, her supervisor, Sergeant Charles Bowman, ordered her to prepare an incident report detailing why she failed to report to assist the officers. Her incident report read as follows:

CO Nowicki arrived on unit asking me to go to A&D for an out of control female booking. My reply was due to a back injury I would not be able to go and my doctor telling me not to strain my back. My attorney asked if my job was accommodating my injury so no more injury occurred. My reply their (sic) is no light duty on my shift, and I am on nightshift. I was always told a CO is a CO. Their (sic) were plenty of male CO’s to handle the situation along with some females. I was also told the situation was under control. I have had to be in many situations where I had to deal with a male strip all in the line of duty.

(Brief in support of defendant’s motion for summary judgment, at 3.)

The uncooperative inmate was on drugs and throwing people around the room. Plaintiff advised Sergeant Bowman she was uncomfortable in dealing with that individual because someone — either herself or another officer — could have been injured as a result of her back and neck injuries preventing her from performing the physical acts needed to control and subdue the inmate.

Plaintiff’s supervisors told her she was not to return to work until she was able to perform all of the duties required of a correctional officer. These duties include the ability to move quickly up and down stairs, respond to emergencies, and to physically restrain combative inmates. Plaintiff’s injuries prevented her from performing these tasks. Plaintiff subsequently provided her supervisors with a note from Dr. Mitchell H. Baskin indicating she would receive therapy on her back and shoulder such that she would be “up to frill potential.” Plaintiff never returned to work as a correctional officer at Lehigh County Prison after the December 6, 2006 incident.

At this point, plaintiff was placed on a second family medical leave. She was out on FMLA leave from December 5, 2006 through February 26, 2007. On April 18, 2007, plaintiff submitted a leave of absence request acknowledging that her FMLA leave had expired on February 26, 2007 and requesting an additional six months of unpaid leave. That request was granted and made effective retroactive to February 27, 2007, with a scheduled expiration of August 26, 2007.

On August 15, 2007, defendant sent a letter to plaintiff advising her that her leave of absence was set to expire. It further indicated that if she planned on returning to work, she needed to provide medical certification releasing her to full duty with no restrictions, including the ability to work, go up and down stairs, run in emergency situations, and to subdue or control combative inmates. If she was unable to return to work fully able to perform the duties required of her position, defendant advised her that it would treat her failure to return to work as a voluntary termination of employment.

In response to the letter sent to plaintiff, attorney Clyde Bartel, on plaintiff’s behalf, wrote a letter to Director Edward Sweeney dated August 22, 2007 requesting that plaintiff be afforded additional time to meet the requirements from the August 15, 2007 letter. Specifically, attorney Bartel requested that plaintiff have until September 30, 2007 to provide defendant with the required documentation. Director Sweeney sent a responsive letter granting plaintiff an extra month of leave until September 27,2007 to be evaluated by a physician to verify her capacity to return to work.

On September 25, 2007, plaintiff tendered a letter to Director Sweeney from Dorna Armbrister, MD, (exhibit C-ll) indicating plaintiff had an MRI pending for persistent back and cervical pain. Her prognosis was “guarded.” Based on the indication from Dr. Armbrister that plaintiff continued to suffer from pain and was unable to perform essential functions of a correctional officer, defendant terminated plaintiff’s employment effective September 26, 2007.

Procedural History

On September 24, 2010, plaintiff filed a praecipe for writ of summons in the within matter. A complaint was filed on June 15, 2012, and an amended complaint was subsequently filed on August 10, 2012. The amended complaint included claims under the Pennsylvania Human Relations Act (PHRA), the Age Discrimination in Employment Act (ADEA), the Americans with Disabilities Act (ADA), Title VII, and the FMLA.

Defendant filed preliminary objections to each claim. On January 24, 2013, the Honorable William E. Ford struck the PHRA and ADEA claims. Judge Ford denied the demurrer to the ADA and Title VII claims, and granted leave for plaintiff to file a more specific FMLA claim.

The second amended complaint was filed on February 27, 2013. It asserted claims under the ADA, Title VII, and the FMLA. Defendant filed the instant motion for summary judgment on May 31,2013 seeking judgment as a matter of law on each of the three substantive counts of the second amended complaint.

Standard of Review

Before the court is a motion for summary judgment. The standard for summary judgment is well-established.

A court may grant a motion for summary judgment only when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. Bronson v. Horn, 830 A.2d 1092 (Pa.Cmwlth.2003), aff’d, 577 Pa. 653, 848 A.2d 917 (2004), cert. denied, 543 U.S. 944, 125 S.Ct. 369, 160 L.Ed.2d 257 (2004). The right to judgment must be clear and free from doubt. Id. In reviewing the granting of a motion for summary judgment, this Court must “view the record in the light most favorable to the non-moving party, and all doubts as to the existence of a genuine issue of material fact must be resolved against the moving party.” Pappas v. Asbel, 564 Pa. 407, 418, 768 A.2d 1089, 1095 (2001).

Lambert v. Katz, 8 A.3d 409, 413 n.3 (Pa. Cmwth. 2010).

Discussion and Conclusions of Law

Americans with Disabilities Act

Plaintiff’s first cause of action stems from an alleged violation of the ADA. Under the ADA, “[n]o covered entity shall discriminate against a qualified individual on the basis of disability in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment.” 42 U.S.C. §12112(a). Employers violate the ADA when they fail to make “reasonable accommodations to the known physical or mental limitations of an otherwise qualified individual with a disability who is an applicant or employee, unless such covered entity can demonstrate that the accommodation would impose an undue hardship on the operation of the business of such covered entity.” Id. §12112(b)(5)(A). A “qualified individual” is an individual “who, with or without reasonable accommodation, can perform the essential functions of the employment position that such individual holds or desires.” Id. §12111(8). Job functions are deemed “essential” when, inter alia, “the reason the position exists is to perform that function.” 29 C.F.R. §1630.2(n)(2). Evidence supporting a job function being qualified as essential includes an employer’s judgment as to what job functions are essential, the amount of time spent on the job performing that particular function, and the consequence of not requiring the job holder to perform the function. Imler v. Hollidaysburg American Legion Ambulance Service, 731 A.2d 169, 173 (Pa. Super. 1999) (citing 42 U.S.C. §12111(8)).

In order to make out a prima facie case under the ADA, [a plaintiff is] required to show (1) that [she] was an individual who had a disability within the meaning of the statute; (2) that the [employer] had notice of his disability; (3) that with reasonable accommodation [she] could perform the essential functions of the position...; and (4) that the [employer] refused to make such accommodations. An employer can defeat a prima facie claim if it shows (1) that making a reasonable accommodation would cause it hardship, and (2) that the hardship would be undue.

Mitchell v. Washingtonville Central School District, 190 F.3d 1, 6 (2d Cir. 1999) (citations omitted).

The ADA defines reasonable accommodations as including “job restructuring, part-time or modified work schedules, reassignment to a vacant position, acquisition or modification of equipment or devices, appropriate adjustment or modifications of examinations, training materials or policies, the provision of qualified readers or interpreters, and other similar accommodations for individuals with disabilities.” 42 U.S.C. §12111(9)(B). The burden is on a plaintiff to demonstrate that there was a reasonable accommodation, including “identifying an accommodation, the costs of which, facially, do not clearly exceed its benefits. Summary judgment may be granted for a defendant only in cases in which the plaintiff’s proposal is either clearly ineffective or outlandishly costly.” Skerski v. Time Warner Cable Co., 257 F.3d 273, 284 (3d Cir. 2001) (citations, internal quotation marks, and emphasis omitted). To determine an appropriate reasonable accommodation, “it may be necessary for the [employer] to initiate an informal, interactive process with the [employee] in need of accommodation.” 29 C.F.R. §1630.2(o)(3).

For purposes of the instant summary judgment motion, defendant does not appear to contest that plaintiff made out a case for the first two prongs: (1) that she was an individual with a disability, and (2) that defendant was aware of that disability. Defendant asserts plaintiff has not demonstrated that even with reasonable accommodation she could have performed the essential job functions of a corrections officer, and that defendant failed to make such accommodations.

According to an affidavit from Edward Sweeney,
In order to perform the essential job functions of a correctional officer at the Lehigh County Prison, the employee must be able to move quickly, up and down stairs, to respond to emergencies and/or pursue and physically restrain combative inmates. At any point in time in the course of each shift, every officer must be prepared to respond to facility emergencies. Even a control booth officer, when being relieved for breaks, assumes the duties of the relieving officer and must respond to declared emergencies. All officers on duty, regardless of post assignments, including control booth posts, are required to respond to spontaneously declared high level emergencies. This requirement is due to the responsibility of the Lehigh County Department of Corrections to maintain order and protect the public in the case of a riot situation as well as to protect inmates and staff from physical attacks.

(Defendant’s Exhibit C, at 1.)

On December 5,2006, plaintiff was ordered, along with other correctional officers, to report to the admissions and discharge department in order to assist in controlling a combative female inmate. Plaintiff failed to follow that order and acknowledged in her incident report that it was due to a back injury. She asserted her injury prevented her from assisting the other officers out of concern that they might be injured due to her physical inability to restrain the inmate. From the date of that incident onward until the date of her termination, plaintiff was never cleared by a doctor to perform all of the duties of a corrections officer. In fact, the communication from plaintiff’s doctor forwarded to defendant prior to her termination indicated that as of September 27, 2007, she was still suffering from persistent back and cervical pain with a guarded prognosis pending the results of an MRI. Plaintiff asserts she should not have been terminated before the results of that MRI were known. However, the termination occurred after plaintiff had already received a letter from defendant indicating she would be terminated if she could not perform the required functions of her position. Plaintiff was even granted an additional month’s leave in order for her to obtain medical clearance to return to work.

Similar to defendant not contesting plaintiff’s disability, plaintiff does not contest that at the time she was terminated, she was unable to perform the essential job functions of a corrections officer. However, she asserts that given reasonable accommodations, she would have been able to continue in her job. Between her deposition and plaintiff’s brief opposing the instant summary judgment motion, the court notes two accommodations recommended by plaintiff. One is an additional period of unpaid leave and the second is a “light duty” assignment. Regarding the unpaid leave of absence recommendation, under the facts as presented in this matter, defendant gave plaintiff an unpaid leave of absence and in fact extended it an extra month. In that time, plaintiff had the opportunity to obtain necessary medical clearance to return to work if such clearance would have been provided. Under county personnel policy, she had used up her six months annual unpaid leave of absence from February 25, 2007 through August 25, 2007. She had also exhausted her 12-week FMLA leave from December 5, 2006 through February 25, 2007.

From the court’s perspective, the difficulty with plaintiff’s assertion that she requested reasonable accommodation is that plaintiff fails to identify exactly what reasonable accommodation she was requesting. It appears plaintiff designated the request for indefinite extended unpaid leave as a reasonable accommodation. Failing that, plaintiff appears to allege the reasonable accommodation was informal interaction between plaintiff and her employer.

The initiation of the informal interaction requirement was satisfied by the exchange of correspondence in August of 2007 between the defendant and plaintiff’s then-counsel. In terms of granting her indefinite leave, plaintiff fails to acknowledge she had already exhausted her paid leave, her FMLA leave, and her unpaid leave status under the county’s personnel policy, and had been granted an additional one month of unpaid leave to allow her to complete rehabilitation and medical treatment in order to return to work. In light of all this, the court is compelled to ask what more in terms of accommodation was she entitled?

Likewise, the court finds plaintiff’s light duty argument unpersuasive. As the Seventh Circuit Court of Appeals observed in a similar case,

The prison has to be able to call upon its full staff of correctional officers for help in putting down a prison riot, and therefore each officer must have experience in the positions, such as searching and escorting inmates, that provide the necessary training and experience for responding effectively to a riot, as well as the capability for such response. Obviously a prison riot is an extreme threat. But there are many other duties that include disciplining prisoners, inspections, intervening in disputes, and dealing with routine but sometimes tense situations that cannot be subtracted from the performance expectations of a correctional officer.

Dargis v. Sheahan, 526 F.3d 981, 986-87 (7th Cir. 2008) (citation omitted).

In this instance, the court agrees with defendant that there is no light duty option for a corrections officer at Lehigh County Prison. Under the collective bargaining agreement negotiated by her representative union during plaintiff’s employment, plaintiff was ineligible for light duty positions because her claimed injury or disability was not work-related and she still could not perform essential job functions. All corrections officers must be able to respond to situations that arise in dealing with combative inmates, riot situations, disciplinary matters, and intervention in disputes. These critical job functions are essential for the maintenance of security at the prison, along with the preservation of safety of the employees and the inmates. To that end, plaintiff has failed to demonstrate that the lack of a light duty option constitutes a failure on defendant’s part to offer a reasonable accommodation.

In sum, plaintiff has failed to present evidence sufficient for a jury to determine defendant violated the ADA by terminating her. She has failed to identify a reasonable accommodation which was rejected by defendant. Accordingly, summary judgment is granted in favor of defendant and against plaintiff on the ADA claim.

Title VII

Plaintiff’s Title VII claim is based on an allegation that she was treated differently by her superiors because she is an African American. Interestingly, plaintiff does not allege she was terminated on the basis of race.

Under Title VII of the Civil Rights Act of 1964, it is unlawful for an employer “to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual’s race, color, religion, sex, or national origin.” 42 U.S.C. §2000e-2(a).

Defendant brings up as a threshold matter an assertion that plaintiff is barred from seeking relief under Title VII at this time for failure to comply with the procedural requirements.

A plaintiff bringing an employment discrimination claim under Title VII must comply with the procedural requirements set forth in 42 U.S.C. §2000e-5. Before filing a lawsuit, a plaintiff must exhaust her administrative remedies by filing atimely discrimination charge with the EEOC. The EEOC will then investigate the charge, and the plaintiff must wait until the EEOC issues a right-to-sue letter before she can initiate a private action. The ensuing suit is limited to claims that are within the scope of the initial administrative charge. The purpose of requiring exhaustion is to afford the EEOC the opportunity to settle disputes through conference, conciliation, and persuasion, avoiding unnecessary action in court.

Barzanty v. Verizon PA., Inc., 361 Fed. Appx. 411, 413-14 (3d Cir. 2010) (internal quotation marks and citations omitted).

Accordingly, the initial requirement for a Title VII claim is that a plaintiff must timely file a charge of discrimination with the EEOC. The time period in this case is 300 days after the alleged unlawful employment practice. Burgh v. Borough Council of Borough of Montrose, 251 F.3d 465, 472 (3d Cir. 2001) (citing 42 U.S.C. §2000e-5(e)(l)).

On July 21, 2008, plaintiff filed a charge of discrimination with the EEOC. Accordingly, any alleged discriminatory acts must have taken place within the 300 days prior to July 21, 2008. That time period starts on September 25, 2007. Once a charge of discrimination is filed, plaintiff must await a right-to-sue letter from the EEOC authorizing the private suit. Reviewing the documentation, it appears plaintiff complied with these basic requirements. However, defendant asserts plaintiff is time-barred from raising any Title VII claims because of the 300 day requirement.

Plaintiff cites five separate incidents of alleged discriminatory practices ranging from 1989 through the early 2000s. These incidents include: (1) plaintiff being told she was being hired because she is a black female (1989); (2) plaintiff being disciplined for failing to attend required training sessions (1994); (3) plaintiff not being permitted to use a cane on duty to assist in walking (roughly 1999-2000); (4) plaintiff suspended for one day for having a Bible in her possession and allegedly reading it while on duty (the one-day suspension occurred in 2004); and (5) plaintiff allegedly being falsely accused of not conducting a proper inmate count (roughly September of 2006).

All of the foregoing are isolated incidents which took place outside the 300-day timeframe in which plaintiff would have needed to file a Title VII action. Plaintiff also references a newspaper article and a noose and black hood in the prison which she claims to be race-related. These items, however, are historical items relevant to the last time a person was executed by hanging at the prison over 100 years ago. Plaintiff is the only one who appears to affiliate these items with race.

For these reasons, the court finds that plaintiff cannot make out a violation of Title VII and her claim must be dismissed.

Family Medical Leave Act

Plaintiff’s final claim is unfair termination based on her employment being terminated while she was waiting for the results of her MRI. This gives rise to an “interference claim” under the FMLA. See Sommer v. The Vanguard Group, 461 F.3d 397, 399 (3d Cir. 2006).

The FMLA provides that it is “unlawful for any employer to interfere with, restrain, or deny the exercise of or the intent to exercise any right provided” in the FMLA. 29 U.S.C. §2615(a)(l). For a plaintiff to state an interference claim, she must show she was “entitled to benefits under the FMLA and that [she] was denied them.” Sommer, 461 F.3d at 399. To be entitled to benefits under the FMLA, a person must be an eligible employee. An eligible employee is one who was employed “for at least 12 months by the employer with respect to whom leave is requested” and worked “at least 1,250 hours of service with [her] employer during the previous 12-month period.” 29 U.S.C. §2611(2)(A)(i). Eligible employees are provided up to 12 weeks of unpaid leave during any 12-month period as a result of “a serious health condition that makes the employee unable to perform the functions” of her position. 29 U.S.C. §2612(a)(1)(C).

In this case, plaintiff was not an eligible employee. According to the evidence presented in conjunction with the instant summary judgment motion, plaintiff worked only 484.75 hours between September 26,2006 and September 26, 2007, the 12-month period leading up to the date of her termination. (Affidavit of Jane Fisher, defendant’s exhibit B, at 3.) Therefore, she is ineligible for relief under the FMLA because she does not meet the definition of an eligible employee. However, even assuming plaintiff was eligible, she was granted twelve weeks of FMLA leave from December 5, 2006 through February 26, 2007. The FMLA provides that eligible employees are entitled to up to 12 weeks of unpaid leave during any 12-month period. 29 U.S.C. §2612(a)(l)(D). Thus, in the 12-month period in question, plaintiff already received her requisite 12-week unpaid leave. Accordingly, plaintiff has failed to demonstrate entitlement to any rights under the FMLA and has therefore failed to assert a cognizable claim for relief under the same.

Conclusion

Plaintiff has failed to demonstrate defendant violated her rights under the ADA. She has also failed to set forth a prima facie case of discrimination or disparate treatment under Title VII of the Civil Rights Act and all of the incidents cited in support thereof are time-barred regardless. Finally, she has failed to demonstrate eligibility for relief under the FMLA. For the foregoing reasons, summary judgment is properly granted in favor of defendant Lehigh County Prison and against plaintiff, Deborah Penn-Hilbert.

      . The court also notes that light duty was abolished for Lehigh County Prison pursuant to a 2001 collective bargaining agreement.

      . Upon a review of the incidents described by plaintiff, the court finds that procedural bars notwithstanding, plaintiff’s claim lacks merit because these incidents do not establish a prima facie case of discrimination against plaintiff on the basis of race. See Iadimarco v. Runyon, 190 F.3d 151, 157-58 (3d Cir. 1999) (citations omitted) (plaintiff alleging Title VII violation must first establish a prima facie case of racial discrimination). The incidents cited are not evidence of any continuous or cumulative pattern of racial discrimination. See, e.g., Meritor Sav. Bank, FSB v. Vinson, 477 U.S. 57, 67, 106 S.Ct. 2399, 91 L.Ed.2d 49 (1986) (isolated incidents of racially discriminatory comments insufficient to establish violation of Title VII). Title VII has not been violated in this matter in defendant’s dealings with plaintiff.

      . Even if plaintiff was eligible under the FMLA, her claim still fails. Plaintiff asserts defendant should have waited for the MRI results before terminating her employment. However, defendant was under no obligation to do so. “In order for an employee to demonstrate entitlement to restoration, the employee must have been able to perform essential functions of the job without accommodation at the time [she] sought restoration.” McFarlan v. Ivy Hill SNF, LLC, 675 F.3d 266, 271-72 (3d Cir. 2012) (citation and internal quotation marks omitted). As was discussed in the ADA context, plaintiff was incapable of performing the essential job functions of a corrections officer upon the expiration of her leave. In fact, plaintiff has never asserted an ability to perform the essential job functions of that position. Defendant therefore did not violate her rights in terminating her.