Opinion
Civil 02-1920 (PG) (JA).
October 5, 2004
OPINION AND ORDER
This matter is before the court on motion to dismiss and/or for summary judgment filed by co-defendants Me Salvé Ponce, Inc., Me Salvé Río Piedras, Inc., Me Salvé Cantón, Inc., Me Salvé Isabela, Inc., Me Salvé, Inc., (hereinafter "Me Salvé") and Batas Textiles, Inc. ("Batas") (collectively referred to all as "defendants") on October 30, 2002. (Docket No. 7.) An opposition to defendants' motion was filed by the plaintiffs, César García Miranda (hereinafter "García"), his wife Elsie Trinidad Tolléns, and the conjugal partnership formed by them, on December 11, 2002. (Docket No. 16.) A reply to the opposition was filed by the defendants on February 14, 2003. (Docket No. 21.) The plaintiffs then submitted a "Supplemental Motion to Opposition to Defendant's [sic] Motion to Dismiss and/or for Summary Judgment" on February 18, 2003. (Docket No. 23.)
Subsequently, on March 18, 2004, the court issued an order compelling the parties to inform within 30 days whether they consented to have the case assigned to a magistrate judge for all remaining proceedings. (Docket No. 30.) The court admonished that the failure of any party to inform the court on the matter would be treated as an implied consent to the magistrate's jurisdiction. (Id.) In compliance, the defendants consented to have the case assigned to a magistrate judge (Docket No. 31); the plaintiffs however, did not respond to the court's order. On May 19, 2004, the court issued its order of referral. (Docket No. 33.) On the same date, the case was randomly assigned to me for all further proceedings. (Docket No. 34.)
Having considered the arguments of the parties, the evidence in the record and for the reasons set forth below, defendants' motion to dismiss will be DENIED.
I. STATEMENT OF THE CASE
García brings the present action against the defendants including Lazoff Brothers, Inc. (hereinafter "Lazoff") for the alleged violation of his civil rights and for retaliation. (Docket No. 1.) The central allegation in the complaint is that defendants discriminated against him because of his opposition to an unlawful employment practice and because he was going to participate as a witness on behalf of his father in a separate age discrimination action filed against the same defendants. (Id.) García alleges that this court has jurisdiction over his claims pursuant to the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. § 621 et seq. and section 704(a) of Title VII of the Civil Rights Act, 42 U.S.C. § 2000e et seq. This court's supplemental jurisdiction is invoked to also assert state law claims specifically pursuant to Law 80 of May 30, 1976, 29 P.R. Laws Ann. § 185e et seq.; Article 1802 of the Puerto Rico Civil Code, 31 P.R. Laws Ann. § 5141; and 32 P.R. Laws Ann. § 3141-49.
The complaint alleges that García began working for the defendants in or around August of 1987. He worked at defendants' warehouse occupying several positions. The last position he held was that of Warehouse Supervisor. García maintains that part of the reasons he began working for the defendants was the fact that his father, Mr. Julio García Rosabal, had worked for the defendants for many years. Mr. García Rosabal was the most senior employee of the defendants prior to being discharged. Plaintiff García was himself one of the most senior employees working for the defendants having worked for them since he was 15-years old. It is alleged that García was at all times a hard working and dedicated employee who never received a negative evaluation or warnings, except those received after his father filed a complaint against the defendants.
It is further stated in the complaint that Mr. García Rosabal was terminated by the defendants on December 22, 2000. As a result, he filed a discrimination charge with the Anti-discrimination Unit of the Puerto Rico Department of Labor and Human Resources. Mr. García Rosabal claimed that he was harassed, discriminated against and eventually terminated by reason of his age. Soon thereafter, García informed his employer that he would be serving as a witness in his father's case since he had witnessed many instances of harassment and discriminatory actions taken by the defendants against his father. The crux of García's testimony on behalf of his father was that the latter was discriminated against by reason of his age and that the reasons given by the defendants to justify his termination were false and pretextual.
As soon as the Equal Employment Opportunity Commission issued a right to sue letter, García's father filed a complaint in this court under the ADEA against the defendants (Civil No. 01-1441(DRD)). Once again, García informed the defendants of his intention to testify in his father's lawsuit. It is alleged by García that almost immediately, the defendants engaged in a harassment and discrimination campaign against him because of his role in his father's case. Allegedly, one of defendants' owners summoned García to a meeting to inquire about the nature of the testimony he would offer. A defendants' official also told García that whatever he testified in his father's case, that it should favor the defendants or otherwise he would also be terminated from employment. García replied that he would tell the truth about the harassment and discrimination his father was subjected to.
Other allegations in the complaint include the hiring of an employee with less seniority and experience to supervise García; the gradual stripping and reduction of functions and duties to force his resignation; and his exclusion from all meetings in which he participated prior to his father filing the complaint. Similarly, the defendants stopped requesting reports and information regarding the warehouse that García managed or the employees that he supervised. García was the only employee who was ordered to take a drug test and was the subject of derogatory remarks. He complained about the situation to the defendants but nothing was done to remedy the same.
On July 19, 2001, García's father reached a settlement in the case filed against the defendants. On the same date that the court entered judgment dismissing the case — July 31, 2001 — the defendants terminated García from employment. No explanation or reason was given, according to García, for the termination. García claims that the only reason for the termination was his involvement or announced involvement in his father's case and that defendants' unlawful employment actions have caused him and his wife considerable damages.
II. STANDARD OF REVIEW
A. Summary Judgment Standard
Both parties submit materials outside the pleadings in relation to the matter currently before the court. Therefore, I consider defendants' motion under Federal Rule of Civil Procedure 56(c) and will dispose of it accordingly. Sloan Constr. Co. v. Am. Renovation Constr. Co., 313 F. Supp. 2d 24, 30 (D.P.R. 2004) (quoting Garita Hotel Ltd. P'shp. v. Ponce Fed. Bank, F.S.B., 958 F.2d 15, 18 (1st Cir. 1992)) ("If, on a motion to dismiss, pursuant to Fed.R.Civ.P. 12(b)(6), `matters outside the pleadings are presented to and not excluded by the Court, the motion may be treated as a motion for summary judgment and disposed of as provided in Rule 56.'").
Summary judgment is appropriate when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). To succeed on a motion for summary judgment, the moving party must show that there is an absence of evidence to support the nonmoving party's position. Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986). Once the moving party has properly supported its motion, the burden shifts to the nonmoving party to set forth specific facts showing there is a genuine issue for trial and that a trier of fact could reasonably find in its favor. Santiago-Ramos v. Centennial P.R. Wireless Corp., 217 F.3d 46, 52 (1st Cir. 2000). The party opposing summary judgment must produce "specific facts, in suitable evidentiary form," to counter the evidence presented by the movant.López-Carrasquillo v. Rubianes, 230 F.3d 409, 413 (1st Cir. 2000) (quoting Morris v. Gov't Dev. Bank of P.R., 27 F.3d 746, 748 (1st Cir. 1994)). A party cannot discharge said burden by relying upon "conclusory allegations, improbable inferences, and unsupportable speculation." Id.; see also Carroll v. Xerox Corp., 294 F.3d 231, 236-37 (1st Cir. 2002) (quoting J. Geils Band Employee Benefit Plan v. Smith Barney Shearson, Inc., 76 F.3d 1245, 1251 (1st Cir. 1993)) ("`[N]either conclusory allegations [nor] improbable inferences' are sufficient to defeat summary judgment.").
The court must view the facts in light most hospitable to the nonmoving party, drawing all reasonable inferences in that party's favor. See Patterson v. Patterson, 306 F.3d 1156, 1157 (1st Cir. 2002). A fact is considered material if it has the potential to affect the outcome of the case under applicable law. Nereida-González v. Tirado-Delgado, 990 F.2d 701, 703 (1st Cir. 1993).
B. Local Rule 56
I note that the parties in this case failed to comply with the procedures set forth in the local rules of this district with respect to the proper way to present motions for summary judgment and their respective oppositions. In the District Court of Puerto Rico, Local Rule 56(b), previously 311(12), requires a motion for summary judgment to be accompanied by a separate, short and concise statement of material facts that supports the moving party's claim that there are no genuine issues of material fact in dispute. These facts are then deemed admitted until the nonmoving party provides a similarly separate, short and concise statement of material fact establishing that there is a genuine issue in dispute. Local Rules of the United States District Court for the District of Puerto Rico, Local Rule 56(e) (2004);Morales v. A.C. Orssleff's EFTF, 246 F.3d 32, 33 (1st Cir. 2001); Ruiz Rivera v. Riley, 209 F.3d 24, 26 (1st Cir. 2000); Domínguez v. Eli Lilly Co., 958 F. Supp. 721, 727 (D.P.R. 1997); see also Corrada Betances v. Sea-Land Serv., Inc., 248 F.3d 40, 43 (1st Cir. 2001). These facts must be supported by specific reference to the record, thereby pointing the court to any genuine issues of material fact and eliminating the problem of the court having to "ferret through the Record." Domínguez v. Eli Lilly Co., 958 F. Supp. at 727; see Stepanischen v. Merchants Despatch Transp. Corp., 722 F.2d 922, 930-31 (1st Cir. 1983);Carmona Ríos v. Aramark Corp., 139 F. Supp. 2d 210 (D.P.R. 2001); Velázquez Casillas v. Forest Lab., Inc., 90 F. Supp. 2d 161, 163 (D.P.R. 2000). Failure to comply with this rule may result, where appropriate, in judgment in favor of the opposing party. Morales v. A.C. Orssleff's EFTF, 246 F.3d at 33; Stepanischen v. Merchants Despatch Transp. Corp., 722 F.2d at 929. This co-called "anti-ferret" rule was designed to aid the court in the daunting task of searching the record for genuine issues of material fact. García-Sánchez v. Román-Abreu, 270 F. Supp. 2d 255, 258 (D.P.R. 2003).
In their memorandums, however, the parties make reference to facts and include citations to evidence in the record. Consequently, I reluctantly excuse the parties' failure to comply with the anti-ferret rule.
III. DISCUSSION
A. The Positions of the Parties
The defendants move for dismissal and/or for summary judgment arguing, inter alia, that they were not García's employers. They further assert that of all the parties named as defendants in the complaint, only Lazoff was plaintiff's employer. Accordingly, the defendants maintain that plaintiff cannot seek relief against any party other than Lazoff since such relief is unavailing against parties that do not qualify as employers under the ADEA or Title VII.
García responds to defendants' motion arguing that the defendants are a single employer for purposes of ADEA and Title VII liability. García further contends that although different corporations, the defendants all constitute a single entity with common ownership and management. In addition, García maintains that the labor relations and personnel functions were centralized among the defendants and controlled by the same owners. Specifically, García submits that he provided services to all of the defendant corporations, was transferred from one to another without any formalities or paperwork, and supervised employees from the other corporations at the warehouse where he worked. It is also asserted that all the corporations were interrelated and treated as one by their owners and managers. Finally, García claims that the defendants created the many corporations and the complex corporate structure in part to avoid their obligations and responsibilities toward the union. Therefore, it is plaintiffs' position that as a matter of law, all the named defendants acted as his employer under the "single employer" doctrine.
In their reply to García's opposition, the defendants contend that plaintiffs' submission is unsupported by admissible evidence inasmuch as it has become apparent that García's affidavit (Ex. 1 to the opposition) contains false and incorrect statements. In fact, García has allegedly admitted that he signed the document without reading it carefully. As to the merits, the defendants maintain that García has not been able to show, given the unsupported nature of his allegations, that the separate entities constitute a single employer.
B. The Single Employer Doctrine
The question before the court is whether the appearing defendants were García's employers as defined the ADEA and Title VII. The issue specifically requires application of the "single employer" doctrine.
Under Title VII and the ADEA, a corporation is not liable for discriminatory acts unless it qualifies as an "employer." These two Acts define employer in the same manner. The ADEA defines employer as "a person engaged in an industry affecting commerce who has twenty or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year. . . ." 29 U.S.C. § 630(b). Title VII in turn defines employer as "a person engaged in an industry affecting commerce who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year. . . ." 42 U.S.C. § 2000e(b). Such definitions provide little guidance in employer status.
The First Circuit, as well as courts in other circuits, have held that, in some circumstances, the term employer may be broadly interpreted to include "superficially distinct entities that are sufficiently interrelated to constitute a single, integrated enterprise." Lusk v. Foxmeyer Health Corp., 129 F.3d 773, 777 (5th Cir. 1997); see also Romano v. U-Haul Int'l, 233 F.3d 655, 662 (1st Cir. 2000),cert. denied, 534 U.S. 815 (2001) ("[T]wo entities may be sued as a `single employer' under title VII."). Although the First Circuit has not addressed whether the "single employer" doctrine applies specifically to actions under the ADEA, most other circuits have held that it does. See, e.g., Lusk v. Foxmeyer Health Corp., 129 F.3d at 776-77; Swallows v. Barnes Noble Book Stores, Inc., 128 F.3d 990, 992-93 (6th Cir. 1997);Schweitzer v. Advanced Telemarketing Corp., 104 F.3d 761, 762 (5th Cir. 1997); Herman v. United Bhd. of Carpenters Joiners of Am., Local Union No. 971, 60 F.3d 1375, 1383 (9th Cir. 1995); Rogers v. Sugar Tree Prods., Inc., 7 F.3d 577, 582 (7th Cir. 1993); York v. Tenn. Crush Stone Ass'n, 684 F.2d 360, 362 (6th Cir. 1982). The doctrine unquestionably applies to Title VII actions. Romano v. U-Haul Int'l, 233 F.3d at 662. The parties do not dispute the applicability of the "single employer" doctrine to the facts of these cases. They disagree as to who should be favored. In Romano v. U-Haul Int'l, 233 F.3d at 662, the court analyzed under the plain error standard (since the defendant failed to object to the jury instruction) the correctness of a jury charge instructing the application of the "integrated enterprise" test in the context of the single employer doctrine. The co-defendant U-Haul International maintained throughout the litigation that it was not Romano's (plaintiff) employer for purposes of Title VII liability. Id. at 662. It argued that it was not responsible for hiring, supervising or firing Romano; that those responsibilities fell entirely upon U-Haul Company of Maine, its subsidiary, and that the court erred in not applying the common-law agency test outlined in the Supreme Court's decision in Kolstad v. Am. Dental Ass'n, 527 U.S. 526 (1999). Romano v. U-Haul Int'l, 233 F.3d at 662.
The Romano court concluded that it was not plain error for the district court to instruct the jury on the integrated enterprise test instead of the common-law agency test. Id. at 665. The court explained that it has declined in the past to reach the issue of what is the proper standard for determining employer status under Title VII but that it has "identified three `recognized' methods for determining whether a single employer exists under Title VII: the integrated-enterprise test, the corporate law `sham' test, and the agency test." Id. (citingMás Marques v. Digital Equip. Corp., 637 F.2d 24, 27 (1st Cir. 1980)). The First Circuit has neither explicitly adopted nor excluded any of these formulas. Romano v. U-Haul Int'l, 233 F.3d at 665. However, the court acknowledged that the integrated enterprise test appears to be the test applied by a majority of the circuits presented with the issue. Romano v. U-Haul Int'l, 233 F.3d at 665.
Discussing the correctness of the instruction given, the court found that the district court accurately set out the four factors of the integrated enterprise test, namely (1) interrelation of operations; (2) common management; (3) centralized control of labor relations; and (4) common ownership. Id. at 665-66. The district court erred, however, in not giving proper emphasis to the most important factor, the centralized control of labor operations, i.e., control of employment decisions. Id. at 666. The court held, agreeing with other circuits in which there is near unanimity on the issue, that control of employment decisions is a primary consideration in determining employer status. Id. On the other hand, the circuits are not unanimous on the level of control required from a parent corporation in order to find that the two corporations are a single employer. Id. While circuits like the Fifth and Tenth Circuits have adopted a stringent interrelatedness requirement focusing primarily on the employment decisions prong, the First Circuit decided to apply a more flexible approach that focuses on employment decisions, "but only to the extent that [one corporation] exerts `an amount of participation [that] is sufficient and necessary to the total employment process, even absent total control or ultimate authority over hiring decisions.'" Romano v. U-Haul Int'l, 233 F.3d at 666 (quoting Cook v. Arrowsmith Shelburne, Inc., 69 F.3d 1235, 1240-41 (2nd Cir. 1995)). The reasoning of the court was that a more stringent requirement of inter-relatedness is based on the widely supported corporate law principle of limited liability precluding the imposition of liability on a parent for the action of a subsidiary unless the separateness is a sham (piercing the corporate veil). Id. Nevertheless, the court held that exclusive focus on the labor control prong would render the other three requirements of the test devoid of impact, effectively reducing the same to a one-question inquiry.Id. Finally, it must also be noted that the court in Romano observed that "factors such as sales, marketing, and advertising may be considered under the interrelation of operations prong insofar as they establish direct parental involvement in the subsidiary's daily decisions." Russell v. Enter. Rent-a-Car Co. of R.I., 160 F. Supp. 2d 239, 255 (D.R.I. 2001) (citing Romano v. U-Haul Int'l, 233 F.3d at 667).
This four-factor test has been applied to ADEA and Title VII cases even though originally adopted by the Supreme Court in labor dispute cases. Radio Television Broad. Technicians Local Union 1264 v. Broad. Serv. of Mobile, Inc., 380 U.S. 255, 257 (1965); Lusk v. Foxmeyer Health Corp., 129 F.3d at 777.
In sum, the test to be applied for a determination of whether the defendants and Lazoff are a "single employer" for purposes of the imposition of liability in this ADEA and Title VII case is the integrated-enterprise test. The court must analyze the issue mindful of the following four factors: interrelation of operations; common management; centralized control of labor relations; and common ownership. None of the factors is conclusive and all need not be met in every case. Pentech Papers, Inc. v. N.L.R.B., 706 F.2d 18, 25 (1st Cir. 1983);Swallows v. Barnes Noble Book Stores, Inc., 128 F.3d at 994 (citing Ambruster v. Quinn, 711 F.2d 1332, 1337-38 (6th Cir. 1983)). However, the control of labor relations remains the most important factor, to the extent that Lazoff or the defendants exert an amount of participation that is sufficient and necessary to the total employment process, even if none of the entities have total control or ultimate authority over employment decisions. Romano v. U-Haul Int'l, 233 F.3d at 666.
C. The Evidence in the Record
García asserts that the defendants indeed have interrelated operations since all of the corporations allegedly shared employees, facilities, resources, personnel and management, and also performed services to one another. (See García's Statement, Docket No. 16, Ex. I, ¶¶ 6-10.) Additionally, García submits that all the corporations are managed by its owners, which are the ones that create, impose, control and dictate, the terms and conditions of employment of all defendants' employees. (Id. ¶¶ 8-9.) It is further asserted that the same managers and owners were the ones in charge and in control of defendants' labor relations; namely hiring, training, discipline and termination. (Id. ¶ 10.) García also alleges that defendants' owners and managers indiscriminately assigned and transferred employees from one corporation to another without any formality of procedure. (Id. ¶ 6.) He himself was assigned to work at a different corporation (Batas Textiles, Inc.), and in this transfer, plaintiff was not asked to resigned to his previous position or to enter into a new employment contract. (Id. ¶¶ 11-12.) Moreover, García maintains that all the corporations were treated as one as evidenced by the fact that these corporations provided services to one another also without special formality or procedure. (Id. ¶ 6.)
The defendants respond outlining the evidence that in their opinion demonstrate they are not a single employer for purposes of this action. As to interrelation of operations, the defendants adduce that Lazoff, all the Me Salvé corporations and Batas operated different types of businesses. (Statement of Sender Shub, Docket No. 29, Ex. B, ¶ 4.) Specifically, Me Salvé corporations were engaged in retail services while Lazoff was dedicated to wholesale distribution and Batas was in the business of apparel manufacturing. (Docket No. 29, Ex. B, ¶ 4.) In addition, while Lazoff distributed to Me Salvé, it was not an exclusive supplier. (Id. Ex. C D (Invoices).) Batas in turn, manufactures apparel, something that neither Lazoff nor Me Salvé did. Moreover, these three entities had different and separate employees under separate payrolls and with different operational schedules. (Shub's Statement, Docket No. 29, Ex. B, ¶ 5.) For instance, Lazoff's employees were unionized whereas Me Salvé and Batas employees did not have an employee union. (See García's Deposition, Docket No. 29, Ex. A, at 69.) These corporations used their own equipment, machinery, tools and trucks. (Shub's Statement, Docket No. 29, Ex. B, ¶ 6.)
With respect to common management, the defendants argue that different managing policies, rules, regulations and manuals applied individually to the different corporations. (Docket No. 29, Exs. E, G.) The defendants all had different managing structures. (Shub's Statement, Docket No. 29, Ex. B, ¶ 7.) As to the centralized control of labor relations, the defendants contradicted García's claim that he supervised employees of all the different corporations at the warehouse where he worked. At his deposition, García admitted that his supervision consisted of being present at the warehouse's door to ensure that the employees who came to pick up the merchandise arranged the same properly in the vehicles. (García's Deposition, Docket No. 29, Ex. A, at 23-24.) He further admitted that he had no authority over the employees of other corporations that came to pick up merchandise at Lazoff's warehouse. (Id. at 25-26.) He could not discipline or dismiss such employees. (Id.) Finally, with respect to the last factor — common ownership — the defendants candidly admit that, with few exception, they all had the same owners. (Defendants' Reply, Docket No. 21, at 10.)
D. Application
With the record as constituted, I cannot conclude as a matter of law that the defendants are not a plaintiff's employer under the "single employer" doctrine. As noted above, the parties disregard for the local rules of this district has made the court's task in analyzing this issue, a cumbersome exercise. I agree that plaintiff's attempt to create a factual controversy is deficient inasmuch as the only document that the court can weigh is García's "Unsworn Statement" and that such piece of documentary evidence has been seriously compromised by plaintiff's subsequent admissions regarding his personal knowledge. (See generally García's Deposition, Docket No. 29, Ex. A.) But defendants' attempt to establish the absence of a genuine issue of material fact is equally lacking in substance. The defendants submit some documentary evidence in support of their positions, specifically the unsworn statement of one of defendants' shareholders, Mr. Sender Shub. (Docket No. 29, Ex. B.) Such statement does little to satisfy defendants' burden on summary judgment. For instance, defendants' discussion of the control of labor relations factor of the doctrine is limited to controvert Garcia's statement that he supervised employees. And although the defendants allege that the different corporations had separate employees, under separate payrolls and with different schedules, there is nothing in the record from which I can conclude that the owners and managers of said corporations had no control whatsoever over labor and employment-related decisions, particularly after the defendants admit that their corporations are owned by the same persons.
García's sworn statement is the only document submitted in the English language. The court is precluded from considering documents submitted in Spanish. Local Rule 43; González-De Blasini v. Family Dep't, 377 F.3d 81, 88 (1st Cir. 2004).
The determination of whether two entities constitute a single employer involves a factual inquiry. Pentech Papers, Inc. v. N.L.R.B., 706 F.2d at 24-25; see also Lihli Fashions Corp. v. N.L.R.B., 80 F.3d 743, 747 (2nd Cir. 1996). Being factual in nature, the question should be left to the trier of fact unless there is no dispute between the parties. In this case I am in no position to decide whether or not the operations of this entities were interrelated and to what extend. Similarly and most important, I am in no position to determine the level of control, if any, that one corporation exerted over the labor relations of another. Absolute control or ultimate authority in the employment decisions is not required, only an amount of participation sufficient and necessary to the total employment process.Romano v. U-Haul Int'l, 233 F.3d at 666. Therefore, the determination is better left to the trier of fact. Defendant's motion for summary judgment is DENIED.
IV. CONCLUSION
In view of the above, I find that there are factual questions precluding summary judgment with respect to the single employer question. Therefore, defendants' motion is DENIED.
SO ORDERED