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November 20, 1992


The opinion of the court was delivered by: LECHNER

LECHNER, District Judge

 This employment discrimination action *fn1" is brought by plaintiff John Bermingham ("Bermingham") against Sony Corporation of America, Inc. ("Sony America"), Sony U.S.A., Inc. ("Sony USA"), Sony Corporation ("Sony Japan") *fn2" (collectively, the "Sony Corporation") and Shinichi Takagi ("Takagi") (collectively, the "Defendants"), pursuant to section 1981 ("Section 1981") of the Civil Rights Act of 1866 (the "Civil Rights Act"), as amended, *fn3" 42 U.S.C. § 1981 et seq., 42 U.S.C. § 2000e et seq., as amended ("Title VII"), the New Jersey Law Against Discrimination (the "NJLAD"), N.J.S.A. 10:5-1 et seq., and New Jersey common law. Jurisdiction appears to be appropriate pursuant to 28 U.S.C. §§ 1331, 1343 and 1367.

 Count I is a claim for violation of section 1981 under both the Civil Rights Act and the 1991 Civil Rights Act. Id., P 218. Count II is a claim for breach of an employment-at-will contract which also is alleged to violate the NJLAD and the federal public policy of Title VII. *fn4" Id., P 225-228. Count III is a claim for tortious discharge which is alleged to violate the public polices of both the NJLAD and Title VII. *fn5" Id., P 232. Count IV is a claim for breach of contract. Id., P 237. Count V is a claim for knowing and malicious defamation and slander. Id., PP 241-243. Count VI is a claim for prima facie tort. Id., PP 247-250. Count VII is a claim for intentional and malicious infliction of emotional harm. Id., P 253. Count VIII is a claim against Takagi for tortious interference with contract. Id., P 258.

 Bermingham seeks fifteen million dollars in compensatory damages and one hundred million dollars in punitive damages on each of Counts I through VII. With regard to Count VIII, Bermingham seeks thirty million dollars in compensatory damages and thirty million dollars in punitive damages. *fn6"

 Currently before the court is the motion of the Defendants to dismiss the Amended Complaint pursuant to Fed. R. Civ. P. 12(b)(6). *fn7" For the reasons set forth below, the Defendants' motion is granted; the Amended Complaint is dismissed.


 The Parties

 Bermingham is a forty-seven-year old caucasian. Amended Complaint, PP 15, 45. He resides in Kinnelon, New Jersey. Id., P 45. He was first employed by Sony Corporation in 1982 *fn9" and contends he developed an "impeccable employment history." Id., P 4. He received numerous commendations from superiors, who expressed expectations of his promotion. Id. He received numerous salary increases, bonuses and promotions stemming from his first position at Sony Corporation as Vice President of Sony Tape Sale Company ("Sony Tape") in 1982. Id. He became the President of Sony Tape in 1989. *fn10" Id. Presently, Bermingham's position at Sony Corporation is Executive Vice President of Sony Electronics Group ("Sony Electronics"). Id., PP 4, 5.

 Sony Corporation is a Japanese corporation with its principal place of business in Tokyo, Japan. Id., P 16. Sony U.S.A. is a wholly owned subsidiary of Sony Corporation. It is organized and exists under the laws of Delaware and has its principal place of business in New York City. Id., PP 17, 20. Sony America is a wholly owned subsidiary of Sony U.S.A. It is organized and exists under the laws of Delaware and has its principal place of business in Park Ridge, New Jersey. Id., PP 18, 19. Although Sony Tape and Sony Magnetic are not named in the Amended Complaint, they are mentioned. Id., P 21.

 The top senior management of Sony Corporation is allegedly Japanese and the senior corporate structure of Sony Corporation is predominately Japanese. Id., PP 22, 23. Sony Corporation is alleged to be comprised of "Japanese" companies. Id., P 24.

 Takagi, the only individual named in this action, "is an employee and agent of" Sony Corporation. Id., P 25. He is the president of Domestic Sales and Marketing of Sony Recording Media of America ("Sony Media America") and is the president and Chief Operating Officer of Sony Media America. *fn11" Id., P 25. Takagi is Japanese. Id., P 26.

 The following individuals are mentioned in the Amended Complaint. Masaaki Morita ("M. Morita") is Chairman of the Board and Chief Executive Officer of Sony America, Sony Engineering and Manufacturing of America ("Sony Engineering and Manufacturing") and Sony Media America. Id., P 27. He is also the Vice Chairman of the Board of Sony USA. Id. M. Morita is Japanese. Id., P 28. Norio Ohga ("Ohga") is the Chairman of the Board of Sony USA. Id., P 29. Ohga is Japanese. Id., P 30. John Stern ("Stern") is the Executive Vice President of Human Resources at Sony America. Id., P 31. Stern's race is not alleged. Akio Morita ("A. Morita") is Chairman of the Board of Sony Corporation and an officer and director of Sony USA and Sony America. Id., P 32. A. Morita is Japanese. Id., P 33. Before 1 April 1989, John Hollands ("Hollands") was president of Sony Magnetic Products Group (the "SMPC"). Hollands' race is not alleged. Before 1 January 1992 Neil Vander Dussen ("Vander Dussen") was the Vice Chairman of Sony America, Sony Engineering and Manufacturing and Sony Media America. Id., P 35. His race is not alleged. Dr. T. Aoki ("T. Aoki") is Managing Director of Sony Recording Media Group ("Sony Recording Media"). Id., P 36. T. Aoki is Japanese. Id., P 37.

 Employment With Sony Corporation12

 In 1982, Sony Corporation hired Bermingham as a Vice President of Sales and Marketing for Sony Tape, a division of Sony America. *fn13" Id., P 55. Bermingham contends that "it is precisely because of (his) proven talents and history of successful employment that he was hired by Sony [Corporation]." Id., P 54. During the nine years of his employment with Sony Corporation, Bermingham contends he was responsible at different times for the "sales, marketing, and distribution of magnetic media . . . in the United States and, for a significant portion of that time, was also responsible for finance and operations." Id., P 85. Bermingham asserts he developed Sony Corporation's magnetic products business from a thirty million dollar business to a seven hundred and fifty million dollar business. Id., P 87.

 In 1986 he "redeveloped Sony [Corporation's] professional video and audio tape business" turning it into the number one market share holder and "greatest profit producer for Sony [Corporation] in the Magnetic Products Group in the United States." Id., P 90.

 In 1991 Bermingham further established strategic plans for Sony Corporation's entry into the American market for alkaline, lithium and rechargeable batteries. Id., P 91. Bermingham's contends his employment record with Sony Corporation indicates exceptional performance and he provides the following table for support: Areas of Performance 1982 1990 Sales $ 30 M $ 750 M Constant $ 2.8B Audio Tape 1% 23% Video Tape 3% 15% Pro Tape Single Digit 24%-80% Data Media 0% 20%-45%

 Id., P 92. To further evidence his track record at Sony Corporation, Bermingham refers to his salary increases, employment reviews and promotions.

 On 1 September 1983, 1 September 1984 and 17 September 1985, he received "substantial salary increases." Id., PP 59, 60, 61. On 2 September 1986, Hollands reviewed his employment progress and stated: "Mr. Bermingham's general performance is 'very good, he normally achieves objectives, budgets, sales, etc. leading to high rate of success, and his special success was [the] 1986 national sales meeting.'" Id., P 62. Hollands listed Bermingham's "major strengths" in the following way: "1. - product knowledge; 2 - managing people; 3- presenting ideas and concepts; 4 - interface with Japan; 5 - enthusiasm." Id., P 63. Hollands stated with regard to Bermingham's overall performance that he "meets targets; performed all assigned responsibilities and, accomplished all job objectives since the last review, [and] made effective contributions to the unit." Id. Bermingham alleges that, as a consequence of this review, he received an eight-thousand dollar salary increase in September 1986. Id., P 64. He also received another "substantial" salary increase one month later and a promotion to Senior Vice President of Sony Tape. Id., PP 65, 66.

 On or about 1 October 1987, Hollands again reviewed Bermingham's employment status. Id., P 67. It is alleged Hollands stated: "[Bermingham] consistently performs at high levels." Id., P 68. Hollands' review isolated Bermingham's major strengths as interfacing well with customers, other departments and Japan. Id., P 69. Bermingham was also considered to be excellent in dealing with human resource situations and with marketing programs. Id. Hollands concluded that Bermingham's next position "would logically be company or division President." Id. Hollands' 1987 review gave Birmingham the highest rating. Id., P 70. Bermingham's salary was again increased in 1987 and 1988. Id., PP 71, 72.

 Hollands next reviewed Bermingham's employment performance, on 11 November 1988. Id., P 73. Hollands stated: "Overall effectiveness very high; Sales are up; Cost are down; [and] Profits are up." Id., P 74. Hollands could describe no weaknesses in Bermingham's performance. Id., P 75. It is alleged Hollands also stated: "Within two years [he] should become a division or company head." Id., P 76. Bermingham contends that he was given the overall highest possible rating. Id., P 77. On 1 January 1989 and 1 April 1989, Bermingham's salary was increased. Id., PP 78, 79.

 On 1 October 1989, Bermingham's salary was raised for the third time in that year accompanied by a promotion to Executive Vice President of Sony Tape. Id., P 80. In 1989, Bermingham was promoted to President of Sony Tape with the approval of M. Morita and Vander Dussen. *fn14" Id., P 81.

 On 1 April 1991, Bermingham received a seven percent salary increase and on 14 June 1991 he received an employment compensation bonus at ninety-five percent of the incentive plan, allegedly as an acknowledgment of his performance. Id., PP 83, 84.

 The Alleged Discrimination

 In January 1991, Bermingham was asked by Takagi to represent Sony Corporation and two divisions of Sony Corporation, Sony Energy Tech and Sony Magnetic, during the negotiations of a contract dispute with Time Craft Industry, Inc. ("Time Craft"). Id., P 93. In July 1991, a settlement was entered with Time Craft for five hundred and sixty thousand dollars. Id., P 94. The Japanese managers who caused the dispute with Time Craft were retained by Sony Corporation without demotion. Id., P 95.

 As a result of the dispute with Time Craft, Bermingham contends he unknowingly became subject to a "secret scheme" instituted by Takagi to "destroy Bermingham's position, reputation, prestige and authority with Sony [Corporation]. . . ." Id. The scheme allegedly stemmed from the racially motivated activities of Takagi and Sony Corporation. Id. Bermingham asserts he discovered the scheme in August 1991. Id.

 To evidence the alleged discriminatory scheme, Bermingham contends that for the first six of his nine years with Sony Corporation, when he reported to Hollands, he never experienced an employment problem. Id., PP 96-97. Bermingham again contends that prior to 1 April 1989 through 31 March 1990, when he reported to H. Akita, he never experienced an employment problem. Id., P 98. However, Bermingham contends that when Takagi became his supervisor in April 1990, his employment problems began. *fn15" Id., P 99.

  Bermingham contends: "Virtually from the first moment . . . Takagi, became . . . Bermingham's . . . supervisor, [Takagi] began a secret campaign to destroy Bermingham's career and position . . . [and] . . . his reputation, all premised upon . . . [Takagi's] demonstrated history for racial intolerance with his caucasian subordinates and associates." Id., P 100. Takagi allegedly engaged in a pattern and scheme of defaming Bermingham. Id., P 101. Allegedly, Takagi questioned Bermingham's loyalty and capabilities by making defamatory statements *fn16" to Bermingham's associates, subordinates and superiors. Apparently, Takagi conducted himself in this manner without informing Bermingham or offering him counseling, as Bermingham contends is required by the Employment Guidelines. Id.

 On 11 June 1991, Bermingham, while attending a meeting at a Sony Corporation plant in Dothan, Alabama, was told "he had a major problem with . . . Takagi . . . and [was] asked whether [he] was aware of the problem." Id., PP 103, 104. He responded that he was not aware of a problem; however, he contends "the entire Japanese management of the company was aware of Takagi's secret campaign and his past history in this regard." Id., P 105.

 On 14 June 1991, Bermingham and Takagi met. Id., P 106. At this meeting, Takagi told Bermingham that Sony Corporation, other Japanese management and "he were disappointed with Bermingham's management style and his ability to manage the business." Id., P 107. Takagi also stated: "As far as Japanese management was concerned, Bermingham had no future" with Sony Magnetic or Sony Corporation. Id., PP 106, 108. Bermingham's management style was apparently problematic *fn17" for the Defendants because he "had an inability to supervise his employees, . . . failed to bring problems to his Japanese superior's attention," had an intimidating management style and developed extreme loyalty from his subordinates. Id., P 107. Bermingham, however, contends that Takagi's statements are belied by Bermingham's record at Sony Corporation. Id., P 114.

 Bermingham further contends that, at the 14 June 1991 meeting, Takagi "physically demonstrated" contempt for him by sitting with his feet on his desk, looking out the window, playing on his computer and reading his mail during the conversation. Id., P 112.

 Bermingham was "taken aback" by Takagi's statements during the 14 June 1991 meeting and alleges the statements were racially motivated and were designed to intimidate and humiliate Bermingham. Id., PP 110, 111. Bermingham contends, "then and there, [they] actually and constructively terminated his position of authority . . . because he was not Japanese." *fn18" Id., P 111.

  On 17 June 1991 Bermingham again met with Takagi to attempt to resolve the issues raised at the 14 June 1991 meeting. Id., P 138. Bermingham suggested a three to six month trial period and "assured Takagi . . . he was ready to go forward in a positive manner." Id., P 140. Takagi merely reiterated the feeling he expressed at the 14 June 1991 meeting. Id., P 141.

 Bermingham contends the 17 June 1991 meeting only repeated the humiliation and "utter defiance on the part of . . . Takagi, for his caucasian subordinate. . . ." Id., P 143. Takagi concluded the meeting by stating to Bermingham that "he would continue to think about the situation for a few days and get back" to him by 20 June 1991. Id., P 144.

 At a 20 June 1991 meeting between Bermingham and Takagi, Takagi reiterated his earlier assessment of Bermingham's work. Id., P 163. Takagi concluded the meeting by telling Bermingham to find another position. Id., P 164.

 Bermingham contends that despite these meetings, Sony Corporation failed to comply with the Employment Guidelines. Id., PP 127, 142-43. Bermingham had asked for annual employment reviews from Takagi in March 1991, mid-April 1991, and early June 1991, but the reviews were put off by Takagi. Id., PP 128, 130-31. He asserts that prior to the 14 June 1991 meeting, he was not informed in either verbal or written communications that there was any criticism of his performance or quality or quantity of the work he produced. Id., PP 125, 126, 127, 143.

 Allegations of Takagi's Racial Intolerance

 Takagi allegedly has a history of eliminating Americans from senior management and replacing them with Japanese management. Id., P 132. The conduct was allegedly based upon racial intolerance which had no expressed or implied intent to further a corporate goal. Id., P 133.

 Bermingham contends Takagi treated Japanese managers differently than caucasian managers. Id., P 134. He specifically states that when there was a problem with a Japanese Vice President, Takagi reviewed the problem with the employee and specifically followed the Employment Guidelines. Id. In virtually every case involving a Japanese employee, it is asserted that the Japanese employee remained in his position. *fn19"

  Allegations of Continuing Violation Through Ratification

 Bermingham contends the discrimination practiced by the Defendants is continuing. Id., P 135. The continuation of the discrimination is allegedly evidenced by the failure of the other Defendants to rectify the situation with Takagi despite Bermingham's willingness to continue to work with Takagi. Id., PP 135, 137. The substance of the following meetings with various Sony Corporation people is offered to evidence this contention.

 In June 1991 Vander Dussen contacted Bermingham and expressed how "upset" he was over the situation with Takagi. Id., P 136. In later conversations, Vander Dussen stated he did not agree with Takagi and that it was a "Japanese thing." Id., P 157. He further told Bermingham he "felt . . . Bermingham had done a great job at Sony [Corporation] and . . . that what was happening . . . was totally unfair" and was "at the hands of Japanese management." Id., P 169. Vander Dussen stated he could not change the minds of Japanese management. Id. Vander Dussen also stated he would attempt to protect Bermingham's family and Bermingham financially; however, he recommended Bermingham look for another position. Id., P 158.

 On 17 June 1991, Bermingham met with Stern. Id., P 145. Stern informed Bermingham that Takagi, six to eight months earlier, had expressed dissatisfaction about Bermingham's work and that it was not something recent. Id., P 146. Allegedly, Stern further informed Bermingham that he was in "total disagreement with Takagi's assessment." Id., P 147.

 Bermingham then met with M. Morita on 24 June 1991 and Bermingham sought to present to senior Japanese management his perception of the Takagi situation. Id., P 165. M. Morita allegedly expressed how "upset he was for the situation," and that he did not understand the reasoning behind Takagi's conduct. Id., P 166. It is also contended M. Morita further stated he did not understand the factual basis for Takagi's expressed problems with Bermingham's management style. Id., PP 166, 167. Bermingham complains that despite these statements, M. Morita was "either unable (or unwilling) to change Takagi's mind in this matter" and he gave Bermingham the impression he would not intercede to halt the alleged "illegal and improper action." Id., P 166. It is asserted these meetings apparently demonstrate that "not only did Sony [Corporation] management take no steps to halt the . . . improper actions, they specifically ratified and perpetuated" it. Id., P 161.

 Takagi, it is further asserted, is "allied with the Tokyo inner circle and, in particular, . . . Ohga, Chairman of the Board of Sony [Corporation] . . . and, thus, Bermingham [did] not anticipate that Takagi's actions would be reversed." Id., P 150. Bermingham contends that other Japanese managers supported Takagi. Id., P 151.

 Bermingham also contends the ratification of the actions taken by Takagi is further evidenced by the following alleged offers by Sony Corporation to enter into what Bermingham terms new contractual relationships with him. Id., P 135. On 15 July 1991, Vander Dussen announced that Bermingham was taking a corporate staff position as an Executive Vice President. Id., P 172. A corporate release read:

 SONY STATEMENT - July 16, 1991


Effective July 15, . . . Bermingham has assumed a new position of Executive Vice President in the Sony Electronics Group on an interim basis. He will be handling a variety of assignments for top management while evaluating potential new operational responsibilities for Sony [Corporation].


Also effective July 15, the responsibilities for sales and marketing for Sony Magnetic . . . will be assumed to . . . Takagi, President.


. . . Bermingham joined Sony [Corporation] in 1982 as Vice President, [of] Sony Tape . . ., [and has] risen to Senior Vice President in 1986 and was appointed President in 1989. During this nine year period his efforts have contributed significantly to the growth of magnetic products business.

 Id. (the "16 July Corporate Release"). It is alleged that by making this assignment, the Japanese executive management ratified the conduct of Takagi. Id., P 183.

 Bermingham, however, contends that the new position, as Executive Vice President, had no subordinates, no authority, no mission and no agenda. Id., P 173. The assignment was allegedly a humiliating demotion and a constructive termination and a discharge which gave Bermingham at most "an empty desk, a secretary, and no future." Id., PP 175, 189. Significantly, however, notwithstanding all of the voluminous allegation in the sixty-three page, two hundred and sixty-one paragraph Amended Complaint, Bermingham does not allege either that he is no longer employed by Sony Corporation or that he has suffered financially as a result of the change.

 Bermingham states he was qualified for the position from which he was removed and that Takagi was not qualified to replace him because of Takagi's racial bias and discrimination. Id., PP 190, 206. Bermingham contends the decision to replace Bermingham with Takagi "speak[s] volumes" of the alleged history of Japanese discrimination by Takagi and Sony Corporation. Id., P 196.

 It is further asserted that an offer to transfer (the "Transfer Offer") Bermingham to California, made on 2 March 1992, also evidences the ratification of the discriminatory actions taken by Takagi. Id., PP 210, 211. Accordingly, Bermingham asserts Sony Corporation engaged in continuing racially discriminatory conduct. Id., P 214.

 Bermingham also contends that the failure to remove Takagi and send him back to Japan for retraining evidences ratification of Takagi's actions. Id., P 207. Bermingham was advised that other people wanted Takagi to return to Japan for management retraining because of his particular problem in dealing with caucasian subordinates. Id., P 152. Takagi apparently refused to return for retraining. Takagi was allegedly "designated [the] 'hatchet man' to systematically eliminate targeted caucasian managers." Id., P 153. The Japanese executive management allegedly ratified the conduct of Takagi because of their alleged awareness of Takagi's inability to fulfill his managerial duties without expressing racial bias and discrimination. Id., P 202, 203, 207. Bermingham, therefore, contends that the failure of Japanese management to remove Takagi and reinstate Bermingham to his "rightful" position also constitutes ratification of Takagi's actions. Id., P 210. Bermingham does not allege in the Amended Complaint that any racially biased statements were made or that such documents exist. At best, he alleges his feelings and beliefs. In substance, it appears Bermingham experienced a personality conflict with Takagi.

 Additional Allegations

 Bermingham further asserts that the assignment to the new position of Executive Vice President was defamatory of his reputation both in and out of Sony Corporation. Id., P 177. Bermingham maintains that the assignment to the new position was intentional, malicious and purposeful and, as a result, it caused him great humiliation and embarrassment. Id., PP 197, 198. He allegedly suffered a loss of business reputation and esteem in both Sony Corporation and the electronics industry. Id., P 198. Bermingham contends he suffered emotional trauma and expense to vindicate himself. Id.


 The Defendants argue the Amended complaint should be dismissed pursuant to Rule 12(b)(6). Moving Brief at 10.

 A. Standard of Review

 A court may dismiss a complaint for failure to state a claim where it appears beyond doubt that no relief could be granted under any set of facts which could be proved consistent with the allegations. Hishon v. King & Spalding, 467 U.S. 69, 73, 81 L. Ed. 2d 59, 104 S. Ct. 2229 (1984); Conley v. Gibson, 355 U.S. 41, 45-46, 2 L. Ed. 2d 80, 78 S. Ct. 99 (1957); Unger v. National Residents Matching Program, 928 F.2d 1392, 1395 (3d Cir. 1991); Markowitz v. Northeast Land Co., 906 F.2d 100, 103 (3d Cir. 1990); Ransom v. Marrazzo, 848 F.2d 398, 401 (3d Cir. 1988). In deciding such a motion under Fed. R. Civ. P. 12(b)(6), all allegations in the complaint must be taken as true and viewed in the light most favorable to the plaintiff. Gomez v. Toledo, 446 U.S. 635, 636 n.3, 64 L. Ed. 2d 572, 100 S. Ct. 1920 (1980); Markowitz, 906 F.2d at 103; Melikian v. Corradetti, 791 F.2d 274, 277 (3d Cir. 1986), petition for cert. filed (6 June 1990); Robb v. Philadelphia, 733 F.2d 286, 290 (3d Cir. 1984). Nevertheless, legal conclusions made in the guise of factual allegations are not given the presumption of truthfulness. See Papasan v. Allain, 478 U.S. 265, 286, 92 L. Ed. 2d 209, 106 S. Ct. 2932 (1986); Haase v. Webster, 257 U.S. App. D.C. 63, 807 F.2d 208, 215 (D.C. Cir. 1986); Briscoe v. LaHue, 663 F.2d 713, 723 (7th Cir. 1981), aff'd, 460 U.S. 325, 75 L. Ed. 2d 96, 103 S. Ct. 1108 (1983); Western Mining Council v. Watt, 643 F.2d 618, 626 (9th Cir.), cert. denied, 454 U.S. 1031, 70 L. Ed. 2d 474, 102 S. Ct. 567 (1981).

 A federal court reviewing the sufficiency of the complaint has a limited role. "The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support his claims." Scheuer v. Rhodes, 416 U.S. 232, 236, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974); see also Estate of Bailey v. County of York, 768 F.2d 503, 506 (3d Cir. 1985).

 B. Employment Discrimination

 A plaintiff bringing an employment discrimination suit may bring suit under both Title VII and Section 1981. See Johnson v. Railway Express Agency, Inc., 421 U.S. 454, 459, 44 L. Ed. 2d 295, 95 S. Ct. 1716 (1975).

 Bermingham's Title VII claims are not clearly set forth in Counts II and III. See supra notes 4-5. However, his Section 1981 claim is explicitly set forth as Count I. Even though it appears he is not alleging Title VII claims, it will be assumed that he has and such Title VII claims will be addressed.

 1. Title VII

 Title VII prohibits an employer from discriminating "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. . . ." *fn20" 42 U.S.C. § 2000e2(a).

 It is settled that the statutory scheme of Title VII favors the voluntary resolution of employment discrimination disputes. Waiters v. Parsons, 729 F.2d 233, 237 n.9 (3d Cir. 1984) (per curiam) ("The favored means of resolving employment discrimination disputes is a mutually acceptable resolution, worked out informally under the aegis of the EEOC [Equal Employment Opportunities Commission (the "EEOC")]."); see also Alexander v. Gardner-Denver Co., 415 U.S. 36, 44, 39 L. Ed. 2d 147, 94 S. Ct. 1011 (1974) ("Cooperation and voluntary compliance were selected [by Congress] as the preferred means for achieving" the goal of elimination of employment discrimination.).

 Title VII's statutory scheme "reflects an attempt to balance the competing values" of protecting employees from discrimination and of avoiding the cost of litigating employment decisions that might be resolved voluntarily. Waiters, 729 F.2d at 237 n.9. Title VII establishes a "comprehensive scheme" for resolving complaints of employment discrimination. Johnson, 421 U.S. at 457-58.

 A plaintiff commencing an action under Title VII "must file a timely charge with the EEOC . . . before initiating suit in federal court." Howze v. Jones & Laughlin Steel Corp., 750 F.2d 1208, 1210 (3d Cir. 1984) (citing Love v. Pullman, 404 U.S. 522, 532, 30 L. Ed. 2d 679, 92 S. Ct. 616 (1972)); Lewis v. Swindell Dressler Int'l Co., No. 91-1580, 1992 U.S. Dist. LEXIS 7830 (W.D.Pa. 23 May 1992); Miller v. Beneficial Management Corp., 776 F. Supp. 936, 959 (D.N.J. 1991), rev'd on other grounds, 977 F.2d 834, No. 91-5930, slip op. (3d Cir. 21 Oct. 1992).

 Despite Bermingham's references in Counts II and III of the Amended Complaint to the public policies of the Federal Government as expressed in Title VII, Bermingham fails to allege any facts that he, as required under Title VII, filed a charge with the EEOC within three hundred days of "the alleged unlawful practice." 43 U.S.C. § 2000e-5(e); see Miller., 776 F. Supp. at 959 . Because there is no mention or discussion at all in the Amended Complaint about Bermingham having filed charges with the EEOC, his claims under Title VII, if any, are premature. Accordingly, Bermingham fails to state a claim under Title VII. Any Title VII claims which may be raised in counts II and III are dismissed.

 2. Section 1981

 With regard to Section 1981, the Defendants argue Count I of the Amended Complaint should be dismissed because Bermingham's allegations fail to state claims upon which relief can be granted. Moving Brief at 11. The Defendants further argue the 1991 Civil Rights Act should not be retroactively applied and the standard set forth in Patterson v. McLean Credit Union, 491 U.S. 164, 105 L. Ed. 2d 132, 109 S. Ct. 2363 (1989), should control the analysis of this case. Id.

 Bermingham argues he has set forth a cognizable claim under Section 1981 of the pre-1991 Civil Rights Act and under the 1991 Civil Rights Act. Opp. Brief at 1, 15. He argues he was discriminatorily denied a promotion, terminated *fn21" and entered into a new contractual relationship with Sony Corporation. Id. He further argues he was denied the right to enforce his contract because he was denied access to the procedures set forth in the Employee Guidelines. Id. at 1, 13. As to the viability of his claims under the 1991 Civil Rights Act, he argues Sony Corporation's alleged maintenance of the "status quo" constitutes a continuing violation which is presently actionable because it relates back to the alleged discrimination by Takagi. Id. at 1, 16-17. He further argues the Transfer Offer is a present distinct violation of Section 1981. Id. at 16.

 Before Bermingham's alleged Section 1981 discrimination claim can be addressed it must be determined if the 1991 Civil Rights Act should be applied retroactively. *fn22"

 a. Retroactivity

 The Senate passed its version of the 1991 Civil Rights Act on 30 October 1991 and the House of Representatives passed the Senate's version of the 1991 Civil Rights Act on 7 November 1991. On 21 November 1991, the President signed the 1991 Civil Rights Act *fn23" into law. It amended Section 1981 *fn24" of the Civil Rights Act of 1866. See Tyree v. Riley, 783 F. Supp. 877 (D.N.J. 1992).

 Prior to the 21 November 1991 amendments, application of Section 1981 to employment discrimination claims was governed by Patterson, 491 U.S. at 164. Patterson limited the application of Section 1981 to racial discrimination arising out of the making and enforcing of contracts. 491 U.S. at 179, 185. The petitioner in Patterson was harassed, not promoted and terminated from her employment because of her race. "This type of conduct," the Supreme Court stated, "reprehensible . . . if it be true, is not actionable under [Section] 1981, which covers only conduct at the initial formation of the contract and conduct which impairs the right to enforce contract obligations through legal process." Id. at 179-180. See, e.g., Bennun v. Rutgers State University, 941 F.2d 154, 168 (3d Cir. 1991) ("Patterson limited Section 1981's reach to racial discrimination in the making and enforcing of contracts."), cert. denied, U.S. , 117 L. Ed. 2d 124, 112 S. Ct. 956 (1992); Hayes v. Community General Osteopathic Hospital, 940 F.2d 54, 56 (3d Cir. 1991) (Patterson applies to the making and enforcing of contracts), cert. denied, U.S. c, 117 L. Ed. 2d 110, 112 S. Ct. 940 (1992); Fray v. Omaha World Herald Co., 960 F.2d 1370, 1372-73 (8th Cir. 1992) (Patterson limits Section 1981 to claims showing refusal to enter employment contracts on the basis of race); Revis v. Slocomb Industries, Inc., 765 F. Supp. 1212, 1213-14 (D.Del. 1991) (Patterson narrows reach of Section 1981 to employment discrimination suits involving rights to make and to enforce contracts); Thompson v. Johnson & Johnson Management Info. Ctr., 725 F. Supp. 826, 826-27 (D.N.J. 1989) (Patterson delineates parameters of Section 1981 with respect to employment discrimination where the protections of Section 1981 redress discrimination in the making and enforcement of contracts).

 The 1991 Civil Rights Act was in part a response to this interpretation of the scope of Section 1981. See Fray, 960 F.2d at 1373. Relevant to this case is Section 1981(b), *fn25" of the 1991 Civil Rights Act, which expands the definition of "making and enforcing contracts" to include post-formation conduct, including the modification and termination of contracts and the enjoyment of all terms and conditions of the contractual relationship. 42 U.S.C. § 1981(b).

 Critical in the analysis of this case is whether the expanded definition of "making and enforcing contracts" applies retroactively to cases instituted after the enactment of the 1991 Civil Rights Act which are based on conduct that occurred prior to the amendments enactment.

 The 1991 Civil Rights Act has engendered debate regarding whether it should be applied retroactively. See, e.g., Johnson & Johnson, 783 F.Supp. at 893-94. Although the Third Circuit has not addressed whether the 1991 Civil Rights Act should have retroactive effect in pending or post-enactment cases arising from pre-enactment conduct, it has been determined at the District Court level that it should not. See Tyree, 783 F. Supp. 877 ; see also Newark Branch, NAACP v. West Orange, 786 F. Supp. 408, 430 n.25 (D.N.J. 1992).

 Tyree determined that prospective application of the 1991 Civil Rights Act is the preferred approach in cases which were pending when the Act was enacted. 783 F. Supp. at 892 ; see also Johnson & Johnson, 783 F.Supp. at 898-99; Thomas v. Frank, 791 F. Supp. 470 (D.N.J. 1992); Thompson v. Prudential Ins. Co. of America, 795 F. Supp. 1337 (D.N.J. 1992). Tyree also noted, that the "same rationale and holding would apply to cases instituted after the enactment of the 1991 Civil Rights Act based on conduct that occurred prior to its enactment." Tyree, 783 F. Supp. at 878 n.3; see also Crumley v. Delaware State College, 797 F. Supp. 341 (D.Del. 1992).

 Johnson & Johnson involved a plaintiff's efforts to have the 1991 Civil Rights Act applied retroactively to a Section 1981 wrongful termination claim. 783 F. Supp. 893 . The plaintiff commenced his first action on 26 January 1986. Id. That action was dismissed on 20 November 1989 pursuant to the rule articulated in Patterson, "that Section 1981 'covers only conduct at the initial formation of the contract and conduct which impairs the right to enforce contract obligations through legal proceedings.'" Id. at 894 (quoting Patterson, 491 U.S. 179-80). Following the enactment of the 1991 Civil Rights Act, the plaintiff reinstituted the action, seeking to have the 1991 Civil Rights Act retroactively applied. In denying the plaintiff's request, the Johnson & Johnson court stated:


The Third Circuit has made clear . . . that "when application of the new law would affect rights or obligations existing prior to the change in law," the rule of nonretroactivity applies. In the instant case, plaintiff's claim pursuant to 42 U.S.C. § 1981 addresses conduct that the section did not proscribe at the time the conduct occurred. Thus, the rights and obligations in this case were predicted on the pre-amendment statute. Therefore, . . . this court . . . find[s] against retroactive application.

 783 F. Supp. at 897 (citations omitted).

 Thomas concerned an action commenced on 7 January 1991 for violation of Title VII of the Civil Rights Act of 1964 on the basis of gender, religion and retaliatory discrimination. 791 F. Supp. at 471 . The plaintiff later moved for leave to amend her complaint to include demands for a jury trial and compensatory damages as provided by the 1991 Civil Rights Act. Id. The Thomas court determined that the retroactive application of the 1991 Civil Rights Act "would infringe upon the established, recognized rights of the Defendant . . ." and "impose new, unanticipated obligations upon the Defendant." Id. at 475-76. Because the court determined the retroactive application of the 1991 Civil Rights Act was inappropriate, the request for leave to amend the complaint was denied.

 In Crumley the court consolidated three actions which raised the issue of whether the 1991 Civil Rights Act would be retroactively applied to conduct occurring prior to its enactment. 797 F. Supp. at 343 . The Crumley court held that the 1991 Civil Rights Act would not be retroactively applied "to cases involving conduct occurring prior to the enactment of the 1991 [Civil Rights] Act irrespective of whether suit was filed in federal court prior to or subsequent to the Act's enactment." Id. In reaching this determination the court stated:


Passage of the 1991 Act does not alter a plaintiff's right to be free from discrimination . . ., . . . passage of the Act does, however, impose a new obligation on a defendant to pay compensatory and punitive damages. Accordingly, the court concludes that to apply the 1991 Act retroactively would impact substantially on defendant's previous rights. . . . Moreover, retroactive application of the 1991 Act can not deter discriminatory conduct which occurred prior to the passage of the act.

 Id. at 352. Accordingly, the court declined to apply the 1991 Civil Rights Act retroactively.

 Section 1981(b) of the 1991 Civil Rights Act will not be applied retroactively because this case is based on conduct which occurred prior to the enactment of the 1991 Civil Rights Act.

 b. Continuing Violation and the 1991 Civil Rights Act

 Bermingham contends that Sony Corporation's continuing approval and ratification of the prior discriminatory actions practiced by Takagi constitute a continuing violation which makes his Section 1981 claim presently actionable under the 1991 Civil Rights Act. Opp. Brief at 16-17. In the Amended Complaint, the Transfer Offer made on 2 March 1992 is alleged to be the most recent evidence of the continuing violation of Section 1981. Bermingham alternatively argues the Transfer Offer constitutes a distinct present act of discrimination actionable under the 1991 Civil Rights Act. Id. at 16.

  When confronted with a continuing violation claim, the district court must "identify precisely the 'unlawful employment practice' of which [plaintiff] complains." Bronze Shields, Inc. v. N.J. Dept. of Civil Serv., 667 F.2d 1074, 1083 (3d Cir. 1981) (Title VII claim) (quoting Delaware State College v. Ricks, 449 U.S. 250, 257, 66 L. Ed. 2d 431, 101 S. Ct. 498 (1980), cert. denied, 458 U.S. 1122 (1982)). The Third Circuit has stated:


To prevail on a continuing violation theory, however, the plaintiff must show more than the occurrence of isolated or sporadic acts of intentional discrimination.

  Jewett v. International Telephone and Telegraph Corp., 653 F.2d 89, 91-92 (3d Cir.) (Title VII claim) (quoting Teamsters v. United States, 431 U.S. 324, 52 L. Ed. 2d 396, 97 S. Ct. 1843 (1977), cert. denied, 454 U.S. 969 (1981); see also Ricks, 449 U.S. at 257 (statute of limitations may be tolled by continuing violation, but "mere continuity of employment, without more, is insufficient to prolong the life of a cause of action for employment discrimination."); James v. International Business Machines Corp., 737 F. Supp. 1420, 1424 (E.D.Pa. 1990) (Title VII claim).

  "The plaintiff may not base his or her claim upon conclusory allegations [that a continuing violation exists]." Miller, 776 F. Supp. at 953 . The plaintiff must instead provide factual support "demonstrating a pattern or practice of discrimination that has continued into the present." Cuffy v. Getty Refining & Marketing Co., 648 F. Supp. 802, 810 (D.Del. 1986) (Section 1981 claim). "The continuing violation theory does not cover 'isolated instances of discrimination concluded in the past, even though the effects persist into the present,'" there must be a present violation. Cuffy, 648 F. Supp. at 810 (quoting E.E.O.C. v. Westinghouse Elec. Co., 725 F.2d 211, 218 (3d Cir. 1983) (emphasis in original)); see Shafford v. Chicago Board of Ed., No. 91-3559, 1992 WL 274510 (7th Cir. 8 Oct. 1992) (lingering effects of illegal act insufficient for continuing violation in Section 1981 and 1983 cases).

  Bermingham does not allege that he has repeatedly applied for new positions and been denied. See Miller, F.2d at , No. 91-5930, slip op. at 24. He alleges, instead that racial discrimination continues because he has remained in a position of no responsibility since he was appointed Executive Vice President in July 1991. However, "mere continuity of employment" does not constitute a continuing violation. Ricks, 449 U.S. at 257. Any reduction of authority experienced by Bermingham is a "lingering effect" of the allegedly discriminatory change of position in July 1991.

  Bermingham points to the failure of other management level employees to intercede on his behalf as evidence of ratification and perpetuation of Takagi's improper actions. Amended Complaint, P 161. He specifically refers to conversations in June 1991 with Vander Dussen, id., PP 157-58, 169, Stern, id., PP 145-47, and Morita, *fn26" id., PP 165-67, as well as the 16 July Corporate Release. Id., P 172. Bermingham does not allege that he suffered additional injury as a result of management's failure to act, rather he acknowledges their inaction culminated in Bermingham's appointment to a new position in July 1991. Id., P 170. However, even if the conduct of Vander Dussen, Stern and Morita or the 16 July Corporate Release could be construed as evidence of continuous racial discrimination, the conversations and 16 July Corporate Release occurred in June and July 1991, prior to the enactment of the 1991 Civil Rights Act on 30 October 1991.

  Bermingham also argues that Sony Corporation's failure to send Takagi back to Japan for retraining, in light of his difficulty dealing with caucasians, evidences ratification of Takagi's improper actions toward Bermingham. Id., P 207. Sony Corporation's treatment of Takagi does not, however, constitute discriminatory conduct toward Bermingham. Bermingham does not allege he has suffered any additional discrimination as a result of Takagi's retention of position. The impact on Bermingham appears to be only that his position as Executive Vice President in the Sony Electronic Group remains unchanged. As stated above, effects which persist after a violation is concluded do not constitute a continuing violation. Cuffy, 648 F. Supp. at 810 .

  Bermingham argues that the Transfer Offer evidences a continuing violation which "relates back" to encompass the original act of discrimination by Takagi. Opp. Brief at 17. The Transfer Offer, made in March 1992, is Bermingham's only allegation of improper conduct occurring since July 1991 and after the enactment of the 1991 Civil Rights Act. However, "isolated or sporadic acts" of discrimination do not constitute a continuing violation. Jewett, 653 F.2d at 91-92

  With regard to his second assertion that the Transfer Offer also constitutes a distinct discriminatory act apart from the conduct of Takagi, the allegations in the Amended Complaint nonetheless fail to state a claim under Section 1981, as amended by the 1991 Civil Rights Act. As discussed earlier, Section 1981 provides all citizens with the right to "make and enforce contracts . . . ." 42 U.S.C. § 1981. Congress, through the 1991 Civil Rights Act, expanded the meaning of "make and enforce contracts" to make actionable pre- and post-formation conduct which is racially discriminatory.

  There are no allegations to support the assertion that the Transfer Offer was independently discriminatory. Rather, Bermingham alleges that the Transfer Offer constituted ratification by Sony Corporation of Takagi's earlier allegedly racially motivated conduct. Amended Complaint, PP 210-14. There are no allegations that Sony Corporation made the Transfer Offer because of racial animus against caucasians in general or Bermingham in particular or that it later refused to consummate the Transfer Offer because of racial animus against caucasians in general or Bermingham in particular. There are also no allegations that Bermingham accepted the transfer and was subsequently terminated because of racial animus against caucasians in general or Bermingham in particular. *fn27"

  Notably, Bermingham does not allege that at any time after the July 1991 change in position, he was fired, that he has been unemployed, that his salary has been decreased or that he has been deprived of benefits. Instead, he argues that his authority has not been restored. Bermingham's arguments indicate only the lingering effects of Takagi's allegedly illegal conduct. Bermingham's allegations support the conclusion that only isolated and sporadic acts occurred. He has failed to adequately plead a continuing discriminatory practice or a present violation. His continuing violation theory fails; the 1991 Civil Rights Act will not control the analysis of the acts which occurred prior to the statute's enactment.

  Accordingly, the Amended Complaint fails to adequately plead a continuing violation or to state a claim for discrimination under Section 1981 of the 1991 Civil Rights Act.

  3. Patterson and Pre-amendment Conduct

  Bermingham was hired by Sony Corporation in 1982; the alleged racially discriminatory conduct of Takagi occurred in June and July 1991; and the alleged failure to promote Bermingham occurred on 15 July 1991. As discussed earlier, Patterson makes actionable two types of discriminatory conduct under Section 1981: "conduct at the initial formation of the contract and conduct which impairs the right to enforce contract obligations through legal proceedings." 491 U.S. at 179-80. Section 1981, pre-amendment, did not extend to "problems that . . . arise later from the conditions of continuing employment . . ." and does not support a cause of action for potentially discriminatory "post[-]formation conduct" of contracting parties. Id. at 176-77.

  To determine the scope of Section 1981, the Supreme Court distinguished at great length the roles of Section 1981 and Title VII in remedying racial discrimination. The Court, observing that discrimination claims may simultaneously arise under both Section 1981 and Title VII, stated:


Refusal to enter into an employment contract on the basis of race . . . would be actionable under Title VII as a "refusal to hire" based on race, 42 U.S.C. § 2000e-2(a), and under § 1981 as an impairment of "the same right . . . to make . . . contracts . . . .'" 42 U.S.C. § 1981. But this is precisely where it would make sense for Congress to provide for the overlap. At this stage of the employee-employer relation Title VII's mediation and conciliation procedures would be of minimal effect, for there is not yet a relation to salvage.

  Patterson, 491 U.S. at 182. Prior to the 1991 Civil Rights Act, once the contractual relationship was formed, however, racial discrimination in the "course of employment [was] actionable [solely] under Title VII's prohibition against discrimination in the 'terms, conditions, or privileges of employment.'" Id. at 180. The Court held that Section 1981 precluded a cause of action for potentially discriminatory "post[-]formation conduct" of contracting parties. Id. at 177.

  Accordingly, in order to state a pre-amendment claim under Section 1981 for failure to enter into a non-discriminatory employment contract, a plaintiff must establish that the (1) the employer (2) at the time of the formation of the contract (3) intentionally refused to enter into a contract on racially neutral terms. Id. at 184; see also Carter v. Albert Einstein Medical Center, No. 89-9106, 1990 U.S.Dist. LEXIS 12548 *8-9 (E.D.Pa. 24 Sept. 1990).

  Here, Bermingham, hired in 1982, does not allege that there was discriminatory conduct by Sony Corporation at the time of the formation of the contract relationship; rather, he alleges that the conduct which took place in June and July 1991 was discriminatory. These allegations demonstrate Bermingham's ability to plead racial harassment and discriminatory working conditions. As the Court in Patterson stated:


The plaintiff's ability to plead that the racial harassment is 'severe or pervasive' should not allow him to bootstrap a challenge to the conditions of employment (actionable, if at all, under Title VII) into a claim under [section] 1981 that the employer refused to offer the petitioner the 'same right . . . to make' a contract.

  Id. As in Patterson, the conduct Bermingham alleges relates not to his "employer's refusal to enter a contract . . ., but rather to the conditions of employment." Id. at 185.

  a. Allegations of Discriminatory Harassment

  Significantly, the Third Circuit in Hayes28 affirmed its earlier decision in Matthews v. Freedman, 882 F.2d 83, 85 (3d Cir. 1989), *fn29" where the Circuit held that on-the-job racial harassment was not actionable under Section 1981. See Hayes, 940 F.2d at 56 n. 4. Under the Patterson standard, Takagi's alleged discriminatory treatment of Bermingham during the 14 June 1991 meeting, the 17 June 1991 meeting and the 20 June 1991 meeting is not actionable under Section 1981 because it relates solely to post-contract formation discriminatory working conditions and discriminatory harassment. Accordingly, the alleged harassment and abusive work environment will not support a Section 1981 claim.

   b. Discriminatory Termination

  In Hayes the Third Circuit also held that a racially motivated discharge is not actionable under Section 1981. *fn30" 940 F.2d at 56. In Hayes the plaintiff, an African-American, was an employee of the defendant for more than nineteen years. Id. at 55. He was discharged by the defendant for lying to his supervisor. Id. Thereafter the plaintiff commenced suit for wrongful termination on the basis of race and brought claims under both Section 1981 and Title VII. Id. The district court granted the defendant's Rule 12(b)6 motion in part. Later granted the defendant's motion for summary judgment under the standards set forth in Patterson that the conduct alleged was post formation conduct not actionable under Section 1981. The plaintiff appealed the discriminatory discharge issue and the Circuit affirmed the district court's holding. The Circuit explained that under Patterson, "job termination is clearly 'post-formation conduct' implicating performance of an existing employment contract, but not formation of a contract." Id. (quoting Patterson, 491 U.S. at 179).

  In this case, Bermingham refers to the 15 July 1991 change in his position from president to Executive Vice President as a discharge, Amended Complaint, P 189, constructive termination, id., P 175-76, termination, id., P 222, and an assignment. *fn31" Id., PP 174-178. Significantly, Bermingham does not allege he is in fact no longer employed by Sony Corporation. It appears he remains employed by Sony Corporation in the capacity of Executive Vice President with the same salary and benefits he enjoyed in his prior position. The change in his position, regardless of what it is termed, constitutes post-formation conduct which is not actionable under Section 1981. See Patterson, 491 U.S. at 179.

  c. Right to Enforce Contracts

  Bermingham's allegations also fail to state a claim under Section 1981 with regard to his arguments that he was denied the right to enforce his employment contract rights. Being denied access to the procedures set forth in the Employee Guidelines concerns post-formation contractual rights. The alleged denial of access to the procedures set forth in the Employment Guidelines may be a breach of his employment contract; such conduct "is precisely what the language of [Section] 1981 does not cover." Patterson 491 U.S. at 183. These allegations, accordingly, relate to post-contract formation conduct and are not actionable under Section 1981.

  Discriminatory discharges, discriminatory breaches of employment contracts, discriminatory working conditions and discriminatory harassment implicate "performance of established contract obligations" and involved post-formation discrimination issues. Patterson, 491 U.S. at 177; see Hayes, 940 F.2d at 56. Section 1981 does not extend relief to post-formation contract-related claims and will not support claims of employment discrimination under Section 1981.

  d. Failure to Promote

  Patterson does not automatically preclude claims of discriminatory failure to promote. None the less, Bermingham fails to allege facts to support a failure to promote claim. The Supreme Court articulated the following factors that a plaintiff needs to demonstrate to show discriminatory failure to promote: (1) that he applied for and (2) was qualified for (3) an available position for which (4) he was rejected, and (5) that after he was rejected the employer either continued to seek applicants for the position, or, filled the position. Id. at 186-87. A plaintiff must also demonstrate that the position sought would rise to the level of a new and distinct relationship between the employer and employee as a result of the promotion. The Patterson Court stated:


The question whether a promotion claim is actionable under [Section] 1981 depends upon whether the nature of the change in position was such that it involved the opportunity to enter into a new contract with the employer. If so, then the employer's refusal to enter the new contract is actionable under [Section] 1981.

  Id. at 185. "Where the promotion rises to the level of an opportunity for a new and distinct relation between the employee and the employer . . . such a claim [is] actionable under [Section] 1981." Id.

  The Third Circuit in Bennun, 941 F.2d at 169, applied the Supreme Court's analysis in Patterson and explained when an alleged promotion constitutes a new contract which would be actionable under Section 1981.

  In Bennun, a Hispanic tenured associate professor, when denied a promotion to full professor, commenced an action against the defendant for violation of Section 1981 for failure to promote and for violation of Title VII for discrimination on the basis of national origin. The district court ruled in favor of the plaintiff on both claims. The defendant appealed and the Circuit reversed the district court's holding with respect to the Section 1981 failure to promote claim. The Circuit determined that the plaintiff's failure to promote claim was lacking because the position sought did not rise to the level of a new contractual relationship between the plaintiff and defendant.

  The factors the Circuit considered when making its determination of the viability of the allegation of the creation of the new contractual relationship were whether fundamental changes occurred in the rights, duties, responsibilities and compensation between the position maintained and the position sought. Id. at 169; see also James, 737 F. Supp. at 1423 .

  In Bennun, the plaintiff alleged that the change in his occupation from a tenured assistant professor to a full professor satisfied the requirements for a new contractual relationship. The Circuit determined such a change in position did not create a new contract within the meaning of Patterson because there was no fundamental change in the plaintiff's position. In Bennun the position sought by the plaintiff did not substantially change the level of responsibility or the duties to which he would be required to engage. The Circuit determined that the sole new duty as a full professor would permit the plaintiff to evaluate the candidacy of others for the full professor status. The Circuit determined that the duties and responsibilities as a full professor did not rise to a fundamental change sufficient to qualify as a new contractual relationship with the defendant. Bennun, 941 F.2d at 170. Because the position did not rise to a level that created a fundamental change in the duties and responsibilities of the plaintiff, the failure to promote claim was not viable under Section 1981.

  Here, Bermingham alleges the change in his position from President to Executive Vice President, in July 1991, constitutes a failure to promote claim actionable under Section 1981. *fn32" However, his allegations do not set forth the prima facie elements to support his claim. He does not allege that he applied for an available position for which he was rejected. On the contrary, his allegations demonstrate that he was moved to a different position and that Takagi assumed the responsibilities of Bermingham's prior position. Bermingham fails to set forth a claim under Section 1981. *fn33"

  Bermingham's allegations relate exclusively to conduct occurring after he was hired by Sony Corporation in 1982. Bermingham's ability to plead that Defendants' conduct is discriminatory, 'severe or pervasive,' does not state a claim under Section 1981 for refusing on a discriminatory basis to make a contract. See Patterson, 491 U.S. at 185. Count I of the Amended Complaint is dismissed for failure to state a claim upon which relief can be granted.

  C. State Law Claims: Counts II Through VIII

  The Defendants argue the remaining state law claims articulated in Count II through VIII should be dismissed for lack of supplemental (pendent) jurisdiction. Moving Brief at 23.

  The state law claims in Counts II through VIII of the exhaustively detailed sixty-five page Amended Complaint are brought before this court through the assertion of supplemental jurisdiction. Supplemental jurisdiction enables federal courts to hear state law claims over which there is no independent basis of jurisdiction. 28 U.S.C. § 1367; Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 349, 98 L. Ed. 2d 720, 108 S. Ct. 614 (1988). Supplemental jurisdiction depends upon the existence of subject matter jurisdiction over other claims in the action. Pursuant to 28 U.S.C. § 1367, "district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy. . . ." 28 U.S.C. § 1367(a); see also Sinclair v. Soniform, Inc., 935 F.2d 599, 603 (3d Cir. 1991).

  Section 1367(c) permits a court to decline to exercise supplemental jurisdiction when "the district court has dismissed all claims over which it has original jurisdiction." 28 U.S.C. § 1367(c)(3); see also Carnegie-Mellon, 484 U.S. at 350 ("when the federal-law claims have dropped out of the lawsuit in its early stages and only state-law claims remain, the federal court should decline the exercise of jurisdiction by dismissing the case without prejudice.") (footnote omitted); Fuentes v. South Hills Cardiology, 946 F.2d 196, 198 n.3 (3d Cir. 1991) (dismissal of "pendent state law claim[]" proper where federal claims dismissed for lack of subject matter jurisdiction).

  As discussed, Count I has been dismissed with regard to the Section 1981 claims. As well, there is no basis for a Title VII claim. Because no other ground for supplemental jurisdiction is alleged, *fn34" supplemental jurisdiction will no longer be exercised in this case. United Mine Workers v. Gibbs, 383 U.S. 715, 725, 16 L. Ed. 2d 218, 86 S. Ct. 1130 (1966); 28 U.S.C. § 1367(c)(3). The state law claims as set forth in Counts II through VIII are dismissed. *fn35"


  For the reasons set forth above, the motion of the Defendants is granted and the Amended Complaint is dismissed.

  Dated: 20 November 1992

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