Lamothe-Farwell v. Cmty. Health Ctrs. of the Rutland Region

• Docket Number: 23-CV-02746
• Decision Date: 09 October 2023
• Citation: 2023 Vt Super 100901
• Parties: Lynn Lamothe-Farwell, Plaintiff v. Community Health Centers of the Rutland Region, Inc., Defendant
• Court: Superior Court of Vermont

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2023 Vt Super 100901

Lynn Lamothe-Farwell, Plaintiff v. Community Health Centers of the Rutland Region, Inc., Defendant

No. 23-CV-02746

Superior Court of Vermont, Civil Division, Rutland Unit

October 9, 2023

DECISION ON MOTION

Megan J. Shafritz, Superior Court Judge

RULING ON DEFENDANT'S PARTIAL MOTION TO DISMISS

This is an employment case. Plaintiff Lynn Lamothe-Farwell brings this action against her former employer, Defendant Community Health Centers of the Rutland Region, Inc., alleging that the termination of her employment breached the parties' implied employment contract and constituted unlawful retaliation and discrimination under the Vermont Fair Employment Practices Act. Ms. Lamothe-Farwell also asserts a claim under the Vermont Consumer Protection Act ("CPA"), alleging that she was induced into employment by Community Health's unfair and deceptive promises, namely, that it would provide her with a respectful and professional workplace environment and afford her fair employment practices. Pursuant to Rule 12(b)(6) of the Vermont Rules of Civil Procedure, Community Health moves to dismiss the CPA claim for failure to state a claim upon which relief may be granted. Defendant is represented by Andrew H Maass, Esq., and Plaintiff is represented by Kaveh S. Shahi Esq. For reasons that follow, Defendant's motion is GRANTED.^[1]

Factual Background

For purposes of deciding the instant motion, the Court accepts the following facts as true. Community Health is engaged in the business of providing healthcare services to patients in the Rutland region. Compl. ¶ 2. On February 22, 2021 Ms. Lamothe-Farwell began employment with Community Health as a front office manager in one of its facilities. Id. ¶ 3. She received an annual salary and benefits for performing this job. Id. According to Lamothe-Farwell, in order to induce her into accepting employment, Community Health made promises and representations that it would afford a good, fair, and professional workplace, and also take responsibility for its actions and follow its own rules of conduct. Compl. ¶ 48. Lamothe-Farwell accepted employment with Community Health "[a]s a result of" these promises and representations. Id. ¶ 51.

As it turned out, Community Health's promises and representations were false, deceptive, and unfair, because in reality, its "workplace was a toxic environment with favoritism, backbiting, divisiveness, power plays, bullying incompetence, and cliques." Id. ¶ 49. Additionally, on October 6, 2022, Community Health terminated Lamothe-Farwell's employment, citing her "lack of appropriate behavior within the workplace." Id. ¶ 28 (quoting Community Health's statement). Lamothe-Farwell disputes the accuracy and truthfulness of this stated cause, and asserts that her termination was actually retaliatory and discriminatory, as well as contrary to Community Health's stated own code of conduct and promises of fair treatment. Id. ¶¶ 37, 48-49, 58-75. She alleges that as a result of Community Health's "deceptive and unfair practices," her "career as a manager particularly in healthcare, was ruined." Id. ¶ 52.

Discussion

In reviewing a motion to dismiss, the Court accepts "all facts alleged in the complaint as true and in the light most favorable to the nonmoving party." Coutu v. Town of Cavendish, 2011 VT 27, ¶ 4; see also Winfield v. State, 172 Vt. 591, 593, 779 A.2d 649, 652 (2001) (mem.) (when considering a motion to dismiss under Rule 12(b)(6), the court must "assume that all well pleaded factual allegations in the complaint are true, as well as all reasonable inferences that may be derived therefrom"). However, to the extent a party asserts "conclusory allegations or legal conclusions masquerading as factual conclusions," the Court is not required to accept them as true. Rodrigue v. Illuzzi, 2022 VT 9, ¶ 33 (quotation omitted). "The purpose of a motion to dismiss for failure to state a claim upon which relief can be granted is to test the law of the claim, not the facts that support it." Samis v. Samis, 2011 VT 21, ¶ 9. Dismissal is proper when there is no set of facts and circumstances alleged in the complaint which, if proved would entitle the plaintiff to relief. Id.; see also Montague v. Hundred Acre Homestead, LLC, 2019 VT 16, ¶ 11 ("[W]here the plaintiff does not allege a legally cognizable claim, dismissal is appropriate.").

The Vermont Consumer Protection Act provides a cause of action to any "consumer who contracts for goods or services in reliance upon false or fraudulent representations or practices . . . or who sustains damages or injury as a result of any false or fraudulent representations or practices prohibited by" the Act. 9 V.S.A. § 2561(b) (2020 repl. ed.). In Count III of her Complaint, Lamothe-Farwell asserts that her claim falls under this provision, as follows:

As a prospective employee and subsequently as an employee hired by defendant, plaintiff was a consumer in the labor market seeking to contract for services in return for income and benefits. In addition to the service of employment, defendant offered the services of HR to its employees such as the plaintiff. Plaintiff was therefore a consumer under CFA section 2451a(1).

Compl. ¶ 47. Community Health counters that Ms. Lamothe-Farwell was its employee, not a "consumer" of any "goods or services" it sold; that Lamothe-Farwell did not contract for any "goods or services" from Community Health; and that it was Lamothe-Farwell's employer not a "seller," within the meaning of the CPA. The Court agrees. Although the Vermont Supreme Court has not yet addressed whether the CPA applies to an alleged "unfair or deceptive act" committed by an employer during the inducement and formation of an employment contract, and/or by the employer's failure to treat an employee in a manner promised during the period of contract formation, the Court concludes that our Supreme Court is unlikely to extend the CPA's scope in such a manner, and therefore Lamothe-Farwell's claim must be dismissed.

First, the Complaint fails to allege facts that would show that Ms. Lamothe-Farwell and Community Health are a "Consumer" and "Seller" within the meaning of the CPA. The CPA defines a "Consumer" as "any person who purchases, leases, contracts for, or otherwise agrees to pay consideration for goods or services not for resale in the ordinary course of the person's trade or business but for the person's use or benefit." 9 V.S.A. § 2451a(1) (emphasis added). Here, Lamothe-Farwell does not assert that she agreed to pay any consideration to Community Health for its goods or services. Rather, she contends that "in return for" receiving income and benefits, she contracted "for" certain services from her employer Community Health. Compl. ¶ 47.^[2] Not only does this formulation fail to satisfy the CPA's definition of a "consumer," it is plainly twisted and nonsensical. It posits that the employer provides the employee not only income and benefits, but also certain "services," while the employee gives nothing to the employer in return. On the contrary, however, the typical employee receives income and benefits (not services) from her employer, as may be specified in the employment contract; and in return, the employee agrees to terms that obligate the employee to perform certain job duties or functions.^[3]

Moreover, under the CPA, a "Seller" means "a person regularly and principally engaged in a business of selling goods or services to consumers." 9 V.S.A. § 2451a(3). While Lamothe-Farwell argues that Community Health offers and sells to its prospective and current employees (such as herself) the "service of employment" and/or the "service of HR," Community Health is not in the business of offering or selling such services to anyone, including any employees. Rather, Community Health is regularly and principally engaged in offering or selling healthcare-related services to patients in the Rutland region. See Compl. ¶ 2; Pl.'s Surreply to Mot. to Dismiss Count III, at 4-5 (quoting a description of Community Health's business function and scope directly from its website); see also Foti Fuels, Inc. v. Kurrle Corp., 2013 VT 111, ¶ 21 (noting that, to be considered "'in commerce,' the transaction must take place in the context of an ongoing business in which the defendant holds himself out to the public" (quotation omitted)). Under the CPA, therefore, Community Health is a seller of healthcare services, not a seller of "services of employment" or "services of human resources" to anyone, including its employees. See Carter v. Gugliuzzi, 168 Vt. 48, 52-3, 716 A.2d 17, 21 (1998) (to "sell" under the CPA means "'to cause or further the sale of,' 'to deal in an article of sale; as, to sell groceries or insurance.'" (quoting Webster's New International Dictionary 2272 (2d ed. 1953)) cf. Foti Fuels, 2013 VT 111, ¶ 21 ("[T]ransactions resulting not from the conduct of any trade or business but rather from private negotiations between two individual parties who have countervailing rights and liabilities established under common law principles of contract, tort and property law remain beyond the purview of the statute." (quotation omitted)). Thus, the facts alleged by Lamothe-Farwell do not demonstrate that her employment relationship with Community Health falls within the concepts of "consumer" and "seller" under the CPA.

Second Lamothe-Farwell tellingly fails to cite a single case involving any state consumer protection law or the Federal Trade Commission Act in which an employer was found or considered to have sold or furthered the sale of "services of employment" or "services of human resources," to any of its employees. Cf. Carter, 168 Vt. at 52 ("In construing the Act, we look to the interpretations accorded...