Glass v. Kemper Corp.
| Citation | 133 F.3d 999 |
| Decision Date | 04 February 1998 |
| Docket Number | No. 97-1261,97-1261 |
| Parties | 135 Lab.Cas. P 58,407, 4 Wage & Hour Cas.2d (BNA) 658 Gregory GLASS, Plaintiff-Appellant, v. KEMPER CORPORATION, et al., Defendants-Appellees. |
| Court | United States Courts of Appeals. United States Court of Appeals (7th Circuit) |
Alan J. Mandel (argued), Chicago, IL, for Plaintiff-Appellant.
Bennett L. Epstein, John F. Zabriskie (argued), Hopkins & Sutter, Chicago, IL, for Kemper Corporation.
Robert N. Hermes (argued), Butler, Rubin, Saltarelli & Boyd, Chicago, IL, for Prime Group, Incorporated.
Robert N. Hermes (argued), Butler, Rubin, Saltarelli & Boyd, Chicago, IL, for Prime International, Incorporated.
Bennett L. Epstein, John F. Zabriskie (argued), Hopkins & Sutter, Chicago, IL, for Steven Timbers and John Neal.
Before POSNER, Chief Judge, and MANION and DIANE P. WOOD, Circuit Judges.
This diversity suit charges breach of an employment contract and related violations of rights conferred by the common law of Illinois, and also violation of Illinois' Wage Payment and Collection Act, 820 ILCS 115. The district court dismissed the statutory claim, holding the wage payment act inapplicable to the facts alleged in the complaint, 920 F.Supp. 928 (N.D.Ill.1996), and granted summary judgment for the defendants on the remaining counts, holding that there was no contractual or other basis for the plaintiff's common law claims. 949 F.Supp. 1341 (N.D.Ill.1997).
The dismissal of the statutory claim was clearly correct. The act "applies to all employers and employees in this State." 820 ILCS 115/1. The plaintiff is not, and at no time relevant to this suit was he, a resident of Illinois. Nor did he perform any work in Illinois; all the work that he did for the defendants was done in Spain. Although the employer defendants have their principal places of business in Illinois, and are therefore "employers ... in this State," we do not think the statute has an extraterritorial reach. Its evident purpose is to protect employees in Illinois from being stiffed by their employers; to this end it imposes heavy sanctions on employers who fail to pay wages that have accrued. 820 ILCS 115/14; Mueller Co. v. Department of Labor, 187 Ill.App.3d 519, 135 Ill.Dec. 135, 543 N.E.2d 518, 521 (1989). It is inconceivable that the framers of the statute meant to extend its protection to employees abroad, who would usually not even be U.S. citizens, let alone residents of Illinois. Even federal statutes presumptively lack extraterritorial reach. EEOC v. Arabian American Oil Co., 499 U.S. 244, 248, 111 S.Ct. 1227, 1230, 113 L.Ed.2d 274 (1991).
True, the Illinois statute authorizes the state's department of labor to make agreements with other states by which Illinois will enforce those states' wage payment acts against employers in Illinois of those states' residents in exchange for reciprocal enforcement by those states of Illinois' act against employers of Illinois residents in those states. 820 ILCS 115/7. But this provision does not help Glass. It suggests that Illinois' law does not protect even its own residents when they are working in another state. This makes it highly unlikely that it would protect a resident of another state who is working in a foreign country--especially since a state's attempt to regulate a transaction wholly in foreign commerce would violate the "negative" commerce clause. "A state cannot regulate sales that take place wholly outside it." In re Brand Name Prescription Drugs Antitrust Litigation, 123 F.3d 599, 613 (7th Cir.1997). See also Healy v. Beer Institute, 491 U.S. 324, 336, 109 S.Ct. 2491, 2499, 105 L.Ed.2d 275 (1989); Brown-Forman Distillers Corp. v. New York State Liquor Authority, 476 U.S. 573, 581-84, 106 S.Ct. 2080, 2085-87, 90 L.Ed.2d 552 (1986); National Solid Wastes Management Ass'n v. Meyer, 63 F.3d 652, 656-61 (7th Cir.1995); K-S Pharmacies, Inc. v. American Home Products Corp., 962 F.2d 728, 730 (7th Cir.1992).
We move on to the contract claim. Although the evidence bearing on the question whether the plaintiff had a contract with the defendants is almost entirely documentary, he is correct to point out that when the existence of a contract depends on inference from a series of documents, the inference is to be drawn by the trier of fact. Coplay Cement Co. v. Willis & Paul Group, 983 F.2d 1435, 1438-39 (7th Cir.1993); Western Industries, Inc. v. Newcor Canada Ltd., 739 F.2d 1198, 1205 (7th Cir.1984); Meyers v. Selznick Co., 373 F.2d 218, 222-23 (2d Cir.1966) (Friendly, J.). Summary judgment on the contract count was proper therefore only if no reasonable judge or jury could infer from the evidence that there was a contract. So let us see.
Gregory Glass, the plaintiff, is a real estate developer who in 1992 was hired by one of the defendants, The Prime Group, Inc., to manage the development of a retail shopping mall in Barcelona. The land for the mall was owned by a Spanish company, Kepro, that was indirectly controlled by Prime. The mall project itself was financed by defendant Kemper Corporation, which was granted an option to buy a controlling interest in Kepro. The terms of Glass's employment were set forth in a letter agreement of October 1, 1992, signed by an official of Prime on behalf of both Prime and Kepro. The letter specified an annual salary of $360,000 and extensive fringe benefits. Although the letter recites that the proposal in it is subject to ratification by the boards of directors of Prime and Kepro, the proposal was never submitted to either board, yet the defendants concede that it was a binding contract; and they honored its terms.
In May of 1994 Kemper, which now had three seats on the six-member board of directors of Kepro, including the chairman's, assumed control of the mall project and placed a Kemper vice-president, Michael Oberst, in charge. Kemper was eager to retain Glass and the four other Americans who were employed on the project. It directed Oberst to work out new contracts with the five "expatriates" that would keep them with the project; the agreement of October 1, 1992, with Glass, and, we assume, the parallel agreements with the other four expatriates as well, were terminable by either party on thirty days' notice. Oberst wrote Glass, who responded in June with a set of proposed terms for a new contract for himself and the others. Oberst responded with his own set of terms, which included increasing Glass's annual salary to $400,000. Although the response contained the notation "Revised terms and conditions to be approved by Kemper/Kepro Board," Oberst told Glass that Kepro's chairman had given him full authority to make all decisions necessary to the management of the project. Formally, Glass remained employed by Prime, but it was understood that his "real" employer was Kemper and Kepro; none of the negotiations over his continued employment were with Prime.
After further oral and written exchanges, Oberst on September 14 sent Glass and the other expatriates a "summary of expatriate compensation and benefits." The cover memo states that a summary of the compensation and benefits "being 'offered' to you" is enclosed and that the terms in the summary have been The summary that was enclosed, it should be noted, was a summary not of an actual employment agreement but merely of the salary and other benefits that Oberst proposed to include in the agreements.
Glass wrote Oberst on September 16 expressing satisfaction with the "new compensation/benefit package" and adding,
Kepro's board did not discuss Oberst's proposal at the September 21 meeting. Glass was fired on October 20, for reasons that are in dispute and do not bear on the issues in the case.
Glass contends that Oberst's memo to him and the other expatriates of September 14 was an offer and that his response two days later was the acceptance, creating a binding contract for the pay and other benefits summarized in the enclosure with the memo of September 14, 1994, but not part of the original contract of October 1, 1992. Glass points to cases which hold that letters of intent and other informal understandings can be treated as legally enforceable contracts even if some of the details of the parties' agreement have been left to further negotiation--that is, even if the agreement is not final. E.g., Magallanes Investment, Inc. v. Circuit Systems, Inc., 994 F.2d 1214, 1218 (7th Cir.1993); Dawson v. General Motors Corp., 977 F.2d 369, 374 (7th Cir.1992); Quake Construction, Inc. v. American Airlines, Inc., 141 Ill.2d 281, 152 Ill.Dec. 308, 565 N.E.2d 990 (1990). We have no quarrel with those cases. They reflect a realistic awareness that the parties to contractual negotiations often intend to be bound before all the details of their deal have been worked out, in order to encourage a prompt start on performance of the contract. E.g., id. at 997; Borg-Warner Corp. v. Anchor Coupling Co., 16 Ill.2d 234, 156 N.E.2d 513, 517 (1958); Channel Home Centers v. Grossman, 795 F.2d 291, 299-300 (3d Cir.1986). But they have no direct bearing on whether one of the parties to a proposed contract, namely Kepro, was bound by the actions of its agent, Oberst.
This question has, potentially at least, two parts. The first is whether Oberst was in fact authorized to approve the terms of a new contract with Glass without getting board...
To continue reading
Request your trial
-
United States v. Hijazi
...1 L.Ed.2d 709 (1957)(Labor Management Relations Act did not apply to dispute between foreign ship and foreign crew); Glass v. Kemper Corp., 133 F.3d 999 (7th Cir.1988)(Illinois Wage Payment and Collection Act did not apply to employee working in Spain for employer who had principal place of......
-
In re Lois/USA, Inc., Bankruptcy No. 99 B 45910(REG)
...would have to be based on information as it was then known.130 But that does not end the analysis. Green Tree observes that each of Glass and Gruen Industries likewise addressed representations made before the contradictory contract was entered into,131 and points out language in each quest......
-
Hirst v. Skywest, Inc.
...for hours worked in a given workweek but also must allege that the plaintiffs worked those hours in Illinois. Cf. Glass v. Kemper Corp., 133 F.3d 999, 1000 (7th Cir. 1998) (holding that Illinois Wage Payment and Collection Act did not apply where the plaintiff's work was outside the state).......
-
Risinger v. SOC LLC
...SOC entities operate principally in Nevada does not make the alleged misconduct arise out of Nevada. See, e.g., Glass v. Kemper Corp., 133 F.3d 999, 1000–01 (7th Cir.1998) (holding that Illinois wage law did not apply to nonresident employee who worked outside the state, even though employe......