Calabotta v. Phibro Animal Health Corp.

• Citation: 213 A.3d 210,460 N.J.Super. 38
• Decision Date: 27 June 2019
• Docket Number: DOCKET NO. A-1576-17T3
• Parties: David F. CALABOTTA, Plaintiff-Appellant, v. PHIBRO ANIMAL HEALTH CORPORATION, Dean J. Warras, and Daniel A. Welch, Defendants-Respondents.
• Court: New Jersey Superior Court – Appellate Division

460 N.J.Super. 38

213 A.3d 210

David F. CALABOTTA, Plaintiff-Appellant,

v.PHIBRO ANIMAL HEALTH CORPORATION, Dean J. Warras, and Daniel A. Welch, Defendants-Respondents.

DOCKET NO. A-1576-17T3

Superior Court of New Jersey, Appellate Division.

Argued May 13, 2019

Decided June 27, 2019

Kathryn Kristine Mc Clure and Mary Anne Sedey (Sedey Harper Westhoff, PC) of the State of Missouri bar, admitted pro hac vice, argued the cause for appellant (Smith Eibeler, LLC, and Mary Anne Sedey, attorneys; Kathryn K. Mc Clure and Mary Anne Sedey, of counsel and on the briefs; John D. Lynn (Sedey Harper Westhoff, PC) of the State of Missouri bar, admitted pro hac vice, of counsel and on the briefs).

Martin Warren Aron argued the cause for respondents (Jackson Lewis PC, attorneys; Martin Warren Aron, of counsel and on the briefs; Mary L. Moore and Katerina Rose Mantell, on the briefs).

James Edward Burden argued the cause for amicus curiae NELA-NJ (Smith Mullin, PC, attorneys; James Edward Burden, on the brief).

James Patrick Flynn argued the cause for amicus curiae ANJMA (Epstein Becker & Green PC, attorneys; James Patrick Flynn, of counsel and on the brief; David Wayne Garland, on the brief).

James R. Michael, Deputy Attorney General, argued the cause for amicus curiae the Attorney General of New Jersey (Gurbir S. Grewal, Attorney General, attorney; Jason Wade Rockwell, Assistant Attorney General, of counsel; James R. Michael, on the brief).

Before Judges Sabatino, Sumners and Mitterhoff.

The opinion of the court was delivered by

SABATINO, P.J.A.D.

This lawsuit is brought by an Illinois resident against his New Jersey-based former employer. Plaintiff alleges the company wrongfully denied him a promotion to a position in New Jersey and thereafter wrongfully terminated him from his job with its subsidiary in Illinois.

Plaintiff claims the company engaged in "associational" discrimination against him, in violation of the New Jersey Law Against Discrimination ("NJLAD"), based on the fact that his wife was then terminally ill with cancer. The company maintains it treated plaintiff fairly, that he never applied for the promotion, and that it justifiably discharged him for engaging in inappropriate conduct at a trade show.

The appeal raises two important and novel questions of law.

First, under principles of statutory construction, can the NJLAD protect nonresident workers and job applicants, despite the fact that the statute's preamble refers to "inhabitants" of this state?

Second, even if the NJLAD can extend to certain out-of-state plaintiffs, do choice-of-law principles weigh in favor of applying the law of Illinois instead to plaintiff's respective failure-to-promote and wrongful discharge claims?

The trial court concluded that Illinois law, rather than the NJLAD, must apply to plaintiff's claims of discrimination because he lived in Illinois and worked for defendants' subsidiary in Illinois. Given that Illinois law has yet to recognize a cause of action for associational discrimination, the court granted defendants' motion to dismiss plaintiff's claims with prejudice.

For the reasons that follow, we conclude that the NJLAD, notwithstanding the solitary reference to "inhabitants" in its preamble, can extend in appropriate circumstances to plaintiffs who reside or work outside of this state. However, whether the NJLAD applies to a particular nonresident's claims turns upon a weighing of the multiple choice-of-law factors set forth in the Restatement (Second) of Conflicts of Laws (Am. Law Inst. 1971) (the "Second Restatement"), as adopted and construed by the New Jersey Supreme Court.

We hold that New Jersey law, and specifically the NJLAD's ban against associational discrimination, applies to defendants' alleged failure to give plaintiff fair consideration for a promotion to a position in New Jersey. The Second Restatement factors strongly weigh in favor of applying New Jersey law, not Illinois law, to this failure-to-promote claim. We therefore reverse the trial court's dismissal of that discrete claim.

As to plaintiff's wrongful discharge claim, we vacate its dismissal and remand the choice-of-law issue pertaining to that claim to the trial court for further analysis. We do so to enable the further development of critical facts bearing on the Second Restatement factors. Among other things, the record needs to be developed more fully and definitively concerning such things as: the location(s) of the person(s) within the company who took part in the decision to terminate plaintiff; the sole or dominant place, if any, that the decision was made; and the location(s) of plaintiff's conduct that precipitated his discharge. After those and other facts pertinent to the choice-of-law analysis are more fully developed, the trial court shall reassess which state has the "most significant relationship" overall to plaintiff's wrongful discharge claim.

I.

We glean the following facts and allegations from plaintiff's complaint and related pleadings, mindful that discovery has not yet been conducted and credibility determinations have not been made.

A.Plaintiff's Work in Illinois for Phibro's Subsidiary

Defendant Phibro Animal Health Corporation ("Phibro"), a company headquartered in Teaneck, New Jersey, develops and sells animal food additives. Prince Agri Products Incorporated ("Prince Agri"), a subsidiary of Phibro, handles marketing, product management, research, development, and technical support. Prince Agri's office is located in Quincy, Illinois, where plaintiff resided at all times relevant to this case.

In 2008, Phibro hired plaintiff to serve as a Vice President of Marketing and Technology Deployment at Prince Agri's office. He worked in that position at Prince Agri in Illinois until his termination in 2016.

When plaintiff was hired, he signed three employment-related form agreements: a Noncompetition and Nonsolicitation Agreement, an Employee Invention Agreement, and a Confidentiality and Nondisclosure Agreement. All three agreements contained the following provision:

THIS AGREEMENT WILL BE GOVERNED BY THE LAWS OF THE STATE OF NEW JERSEY WITHOUT REGARD FOR CONFLICTS OF LAW PRINCIPLES. I EXPRESSLY CONSENT TO VENUE IN, AND THE PERSONAL JURISDICTION OF, THE STATE AND FEDERAL COURTS LOCATED IN NEW JERSEY FOR ANY LAWSUIT ARISING FROM OR RELATING TO THIS AGREEMENT.

[ (Emphasis added).]

Each agreement further stated: "This Agreement does not alter the status of my employment as an at-will employee of [Phibro]."

Defendant Dean J. Warras, the President of Prince Agri, was plaintiff's direct supervisor. Defendant Daniel A. Welch worked as Phibro's Senior Vice President of Human Resources.

Plaintiff maintains that Warras's and Welch's offices were located at Phibro's headquarters in Teaneck. However, in connection with defendants' motion to dismiss the complaint, Warras certified that his own employment was based out of Prince Agri's office in Illinois, the state where Warras maintained a primary residence until approximately August 2016.

While at Prince Agri, plaintiff supervised a team of approximately forty employees who managed existing product portfolios, identified new products, conducted research on product use and development, and provided customer and technical support. According to plaintiff, he consistently received excellent annual performance reviews. Among other accolades, the reviews reportedly stated that plaintiff worked "extremely hard," did an "excellent job," "significantly strengthened" his team over the years, and generated "new credibility and cache in the industry and academic community" for Phibro's products. According to plaintiff, Phibro never placed him on any type of "Performance Management Plan" or "formally counseled [him] for performance or conduct issues."

B.Disabling Health Issues of Plaintiff's Wife

Plaintiff's wife, Beth Calabotta, was diagnosed with breast cancer in 2008. Following a period of remission, Beth's breast cancer recurred in 2014 and spread to other parts of her body.

Plaintiff contends he openly discussed Beth's health issues and prognosis with his co-workers and supervisors. According to plaintiff, between 2014 and 2016 Warras periodically asked him questions about Beth's medical condition. Plaintiff believed that Warras shared the information about his wife's condition with Welch. Additionally, in May and June 2016, the Quincy Herald-Whig and the Wall Street Journal featured Beth in prominent news stories that discussed her terminal illness.¹

C.Company Reorganization and the New Jersey Position

In June 2016, Warras informed plaintiff that Phibro was reorganizing its operations and his responsibilities would be reduced significantly. Under the reorganization, plaintiff would no longer be responsible for marketing and project management, and ten to fifteen people would be cut from his staff. Moreover, plaintiff's title would change to Vice President, Research and Technical Support.

Warras told plaintiff that Phibro had created a new position based at Phibro's headquarters in New Jersey for a Senior Vice President of Marketing and Product Management. According to plaintiff, he inquired about who would be considered for the new position, and Warras responded that an independent recruiting firm would begin interviewing candidates "in the very near future." When plaintiff asked whether he would be considered for the new position, Warras allegedly replied, "I did not think that you would be interested. The job is in New Jersey and with Beth's situation and all ...."

Plaintiff claims he informed Warras and Welch on multiple occasions between June and July 2016 that he "should get serious consideration" for the new Senior Vice President position, given his marketing and product management experience at Prince Agri. At one point, Welch allegedly responded, "I don't know if that is going to happen." Plaintiff requested from Warras the job description for the new position. According to plaintiff, Warras assured him that he...