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BORECKI v. EASTERN INTL. MGMT. CORP.

August 2, 1988

JOSEPH BORECKI, Plaintiff,
v.
EASTERN INTERNATIONAL MANAGEMENT CORPORATION, et al., Defendants



The opinion of the court was delivered by: COHEN

 Plaintiff, Joseph Borecki, commenced this action against his former employers, Eastern International Management Corporation ("Eastern") and Aetna Insulated Wire Company ("Aetna"), and two of their officers, Louis Goodfarb and James Fallon, alleging he was wrongfully terminated in August, 1984. He asserts claims for wrongful discharge (Count I), intentional interference with an economic relationship (Count II), intentional infliction of emotional distress (Count III), and violations of the Age Discrimination in Employment Act, 29 U.S.C. ยง 621 et seq. (the "ADEA") (Count IV). Defendants Eastern and Aetna now move for summary judgment as to Counts II and III and defendant Goodfarb moves for summary judgment as to all Counts. *fn1" For the reasons which follow, the corporate defendants' motions shall be granted and defendant Goodfarb's motion shall be granted in part and denied in part.

 FACTS

 Plaintiff was employed by Eastern and/or Aetna from 1959 until August 22, 1984. *fn2" In 1976, plaintiff was promoted to Vice President in charge of sales, a position he held until his employment relationship with the defendant corporations ended. He was then sixty-one years of age.

 In 1980, the federal government investigated Eastern, Aetna, and other companies owned and/or controlled by defendant Goodfarb for fraudulent practices in the sale of insulated wire and cable. As a result of this investigation, Eastern pled no contest to a 38 count federal indictment and agreed to pay a fine of one and a half million dollars. Defendant Fallon, then Vice President of Finance, pled guilty to obstruction of justice and was sentenced to 179 days in jail. Defendant Goodfarb, then President and principal stockholder of Eastern and Aetna, pled guilty to obstruction of justice and perjury and was sentenced to seven years in prison.

 Both individual defendants entered the Allenwood Federal Penitentiary in August, 1983. Fallon remained incarcerated until January, 1984, at which time he returned to his prior employment. Goodfarb was not released from prison until 1987. Apparently, however, he continued to receive compensation from the corporations. His federal income tax returns indicate he was employed as an "Executive" with Eastern Management Corp. and had wage income of $ 299,719 in 1984 and $ 549,486 in 1985. Eastern's corporate tax returns list Goodfarb as an "officer" and state he devoted one hundred percent of his time to business.

 Plaintiff alleges he met with Fallon on August 22, 1984 and was informed his employment was being terminated. *fn3" He was replaced with Robert Hall, who was then thirty-eight years old and whose compensation was allegedly far less than the plaintiff's.

 Plaintiff thereupon filed two complaints with the New Jersey Division on Civil Rights and the Equal Employment Opportunity Commission ("EEOC"), one against Eastern and Aetna, and one against Aetna alone. The complaints contain no reference to any actions by defendant Goodfarb, but the EEOC did mail copies of the complaints to the Chief Executive Officer of the named respondents. The defendant corporations responded through their attorney, A. Martin Herring, Esquire, who apparently was also Goodfarb's personal attorney. On October 23, 1985, the EEOC notified Herring that it was terminating its investigation. The record contains no evidence that the EEOC held any conciliation discussions.

 Plaintiff then instituted the instant action. He alleges he was terminated in retaliation for his refusal to assist the individual defendants in destroying or altering documents sought by the government during its investigation and that Fallon acted with the authorization and acquiescence of Goodfarb. Complaint paras. 11 and 12. He further claims the individual defendants' actions "constitute a willful and intentional interference with the economic relationship between plaintiff and defendant corporation," id. at para. 16, and that defendants' conduct amounts to the intentional infliction of emotional distress. Id. at para. 20. Finally, he claims his discharge violated the ADEA.

 All defendants move for summary judgment on plaintiff's claim for interference with an economic relationship. They contend that liability may not be imposed on either a corporation, a corporate employee acting within the scope of his employment, or a corporate officer for interfering with an individual's employment and contractual relationship with that corporation. Defendants also urge that a wrongful termination, standing alone, cannot constitute the intentional infliction of emotional distress. The corporate defendants do not seek summary judgment on plaintiff's claims of age discrimination and wrongful discharge.

 DISCUSSION

 Under Federal Rule of Civil Procedure 56(c), summary judgment may only be granted where the materials of record "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Hersh v. Allen Prods. Corp., Inc., 789 F.2d 230, 232 (3d Cir. 1986). Once the moving party has directed our attention to that portion of the record which it believes demonstrates the absence of a genuine issue of material fact, the burden shifts to the non-moving party to "go beyond the pleadings and by her own affidavits, or by the 'depositions, answers to interrogatories and admissions on file' designate 'specific facts showing that there is a genuine issue for trial.'" Celotex Corp. v. Catrett, 477 U.S. 317, 324, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986) (quoting Fed. R. Civ. P. 56(e)). If the non-moving party then fails "to make a showing sufficient to establish the existence of an element essential to that party's case, and on which the party will bear the burden of proof at trial" summary judgment must be entered. Sorba v. Pennsylvania Drilling Co., 821 F.2d 200, 202 (3d Cir. 1987), cert. denied, 484 U.S. 1019, 108 S. Ct. 730, 98 L. Ed. 2d 679 (1988). In determining if such a showing has been made, "the evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S. Ct. 2505, 2513, 91 L. Ed. 2d 202 (1986) (citing Adickes v. S. H. Kress & Co., 398 U.S. 144, 158-59, 90 S. Ct. 1598, 1608-09, 26 L. Ed. 2d 142 (1970)).

 We consider first Goodfarb's contention that he had no involvement in the decision to terminate the plaintiff's employment. While he offers additional reasons why he may not be found liable under any of the theories posited by the plaintiff, he claims his lack of participation in the decision entitles him to summary judgment on all counts.

 At the time of the decision, Goodfarb was incarcerated and he states in his affidavit that he had no input in the day-to-day operations of Aetna or Eastern. Goodfarb Affidavit para. 2. This is consistent with the scenario drawn by Fallon, who states he assumed all of Goodfarb's responsibilities, Fallon Deposition, p. 20, and had the authority to hire and fire Vice Presidents of the corporations. Id. at 19. Both Fallon and Goodfarb have specifically denied any involvement by the latter in the decision to terminate plaintiff's employment. Thus, Fallon testified at his deposition:

 
Q: Did Mr. Goodfarb make any decisions regarding Mr. Borecki's termination?
 
A: No, he did not.
 
Q: So any decisions that were made were totally made by either you or Joe Borecki. Is that correct?
 
A: That's correct.

 Fallon Deposition, p. 43. Similarly, Goodfarb maintains he did not participate in any such decision and did not even learn the plaintiff had ceased working for Eastern and Aetna until after the fact. Goodfarb Affidavit para. 2; Goodfarb Deposition, pp. 54-55. Finally, Goodfarb relies on plaintiff's deposition testimony that Fallon told the plaintiff that he alone had made the decision. Borecki Deposition, pp. 176-77.

 In response, plaintiff first points to Goodfarb's historical control of the defendant corporations. Thus, he avers that Goodfarb made all major decisions affecting Eastern and Aetna prior to his incarceration, as well as many minor decisions, Borecki Affidavit para. 5, a view shared by other employees. See Urbanelli Affidavit para. 6; Tumulo Affidavit para. 3. Moreover, plaintiff states that "during the years I worked for Mr. Goodfarb, he specifically told me that the hiring and firing of all sales and managerial personnel must first be approved by him. In practice, I always got Mr. Goodfarb's approval before I hired or fired anyone." Borecki Affidavit para. 6.

 Next, plaintiff offers evidence tending to show Goodfarb's continuing relationship with the corporation during his incarceration. Plaintiff notes that Goodfarb admits that, while incarcerated, he fired Fallon and hired his replacement. Goodfarb Deposition, p. 39. Plaintiff also produces Eastern's telephone records from September, 1983 to December, 1984, which indicate Eastern frequently accepted collect calls from a single number in the town where Goodfarb was incarcerated. *fn4" As evidence of the calls' contents, plaintiff presents the affidavit of Louis Tumulo, a former Vice President of Eastern, who avers that on several occasions "I was in Mr. Fallon's office when Mr. Goodfarb called him from prison and I heard Mr. Fallon discuss Aetna's business decisions with him." Tumulo Affidavit para. 6. *fn5" Eastern's former receptionist also states that between January, 1984 and May, 1986, she received and delivered to Fallon at least three letters a week bearing Goodfarb's return address. Conway Affidavit para. 5. Lastly, plaintiff notes that both Goodfarb's and Eastern's tax returns show the payment of substantial wages to Goodfarb during his incarceration for work as an "executive" or "officer," and that according to Eastern's tax return Goodfarb devoted all of his time to corporate business in 1984 and 1985.

 Finally, plaintiff claims various inconsistencies in Fallon's statements undermine his assertion that Goodfarb did not participate in the decision. Thus, plaintiff notes that while Fallon maintained he assumed Goodfarb's responsibilities during the latter's incarceration, he also stated:

 
Q: During the period of time I understand that you were acting president of Eastern International Management.
 
A: No, I was not.
 
Q: You were never acting president?
 
A: No.
 
Q: So your position, vice-president of finance, ...

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