Rhoads v. Jones Financial Companies
| Decision Date | 11 February 1997 |
| Docket Number | No. 4:95CV836 FRB.,4:95CV836 FRB. |
| Citation | 957 F.Supp. 1102 |
| Parties | Patricia M. RHOADS, Plaintiff, v. The JONES FINANCIAL COMPANIES, et al., Defendants. |
| Court | U.S. District Court — Eastern District of Missouri |
Mary Anne O. Sedey, President, William E. Moench, Associate, Jon A. Ray, Sedey and Moench, St. Louis, MO, for Patricia M. Rhoads.
Fred A. Ricks, Jr., Associate, McMahon and Berger, St. Louis, MO, John F. Kuenstler, Franczek and Sullivan, Chicago, IL, for Jones Financial Companies and Edward D. Jones & Co., L.P.
Presently pending before the Court is defendants The Jones Financial Companies and Edward D. Jones & Co., L.P.'s Motion to Dismiss or for Summary Judgment with Respect to Plaintiff's Complaint (filed August 7, 1995/Docket No. 7). All matters are pending before the undersigned United States Magistrate Judge, with consent of the parties, pursuant to 28 U.S.C. § 636(c).
In this action, plaintiff claims that her employers, The Jones Financial Companies and Edward D. Jones & Co., L.P., unlawfully discriminated against plaintiff on account of her age and gender. In Count I of her Complaint, plaintiff claims that her employment was terminated by defendants on account of her gender, in violation of Title VII of the Civil Rights Act of 1964 (Title VII), 42 U.S.C. §§ 2000e, et seq. In Count II, plaintiff claims that her termination was also on account of her age, in violation of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621, et seq. In Count III, plaintiff claims that throughout her employment with defendants, she received wages lower than those paid to comparable male employees for equal work, in violation of the Fair Labor Standards Act (FLSA), 29 U.S.C. §§ 201, et seq., as amended by the Equal Pay Act, 29 U.S.C. § 206(d). Finally, in Count IV, plaintiff claims that defendants' actions as alleged in Counts I and II of the Complaint violated the Missouri Human Rights Act (MHRA), Mo.Rev.Stat. §§ 213.010, et seq.
Defendants now move to dismiss plaintiff's Complaint or, in the alternative, move for summary judgment claiming that there are no genuine issues of material fact and that they are entitled to judgment as a matter of law. Specifically, defendants argue that plaintiff lacks standing to invoke the protections of Title VII, the ADEA, FLSA, or MHRA for the reason that plaintiff was at all relevant times a general partner of the corporation and not an employee. In response, plaintiff claims that although she was labelled a "general partner," the circumstances of her employment show her to have been an employee rather than an actual general partner. Because matters outside the pleadings will be considered in determining the instant motion, the undersigned will proceed with defendants' motion as one for summary judgment. See Rule 12(b), Federal Rules of Civil Procedure.
Pursuant to Rule 56(c), Federal Rules of Civil Procedure, a court may grant summary judgment if the information before the court shows that there are no material issues of fact in dispute and that the moving party is entitled to judgment as a matter of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The burden of proof is on the moving party to set forth the basis of its motion, Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986), and the court must view all facts and inferences in the light most favorable to the non-moving party, Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986). Once the moving party shows there are no material issues of fact in dispute, the burden shifts to the adverse party to set forth facts showing there is a genuine issue for trial. Id. The non-moving party may not rest upon its pleadings, but must come forward with affidavits or other admissible evidence to rebut the motion. Celotex, 477 U.S. at 324, 106 S.Ct. at 2553.
Summary judgment is a harsh remedy and should not be granted unless the movant "has established his right to judgment with such clarity as to leave no room for controversy." New England Mutual Life Ins. Co. v. Null, 554 F.2d 896, 901 (8th Cir.1977). The Eighth Circuit has noted, however, that "summary judgment can be a tool of great utility in removing factually insubstantial cases from crowded dockets, freeing courts' trial time for those that really do raise genuine issues of material fact." City of Mt. Pleasant, Iowa v. Associated Elec. Coop., Inc., 838 F.2d 268, 273 (8th Cir.1988).
In March 1977, plaintiff began working for Edward D. Jones & Co. (EDJ) as a management trainee in securities processing operations. In January 1978, plaintiff became a supervisor of legal securities transfers. In July 1980, plaintiff became a manager of money market fund operations. (Rhoads Affid. at 1; Pope Affid. at 1.) Plaintiff received W-2 Wage and Tax Statements from EDJ for the years 1977 through 1983. In 1981, plaintiff became a limited partner in EDJ, and EDJ began reporting plaintiff's share of income, credits, contributions, and deductions on IRS Schedule K-1 forms. Schedule K-1 forms for the years 1981 through 1984 show plaintiff not to be a general partner in EDJ.
Effective January 1, 1984, plaintiff became a "general partner" in EDJ.1 (Rhoads Affid. at 1; Pope Affid. at 1.) At that time, plaintiff became responsible for all internal processes and procedures, including accounting, mutual funds and money market accounts. (Pope Affid. at 1.) Schedule K-1 forms for the years 1984 through 1986 denote plaintiff as a general partner in EDJ.
On July 15, 1987, a Reorganization Agreement was created by which The Jones Financial Companies, L.P. (JFC) was formed to become a limited partner in EDJ. (Pope Affid. at 1; Pltf.'s Response, Reorganization Agreement.) Under the Reorganization Agreement, the general partners in EDJ were to become general partners in JFC. (Reorganization Agreement at 4.) All general partners in EDJ who agreed to such reorganization were to sign the agreement. (Reorganization Agreement at 1.) Plaintiff signed the agreement as a general partner in EDJ. (Reorganization Agreement at 11, 13.) On July 17, 1987, plaintiff accepted an Exchange Offer made to limited and subordinated limited partners of EDJ whereby plaintiff's interest in EDJ was exchanged for an equal interest in JFC. On that same date, plaintiff executed a Power of Attorney naming the managing partner of the firm as attorney-in-fact on behalf of plaintiff's limited and subordinated limited partnership interest in JFC. (Pltf.'s Response, Letter of Acceptance and Assignment, and Power of Attorney.) On August 17, 1987, plaintiff assigned her general partnership interest in EDJ to JFC in exchange for general partners capital in JFC. (Pltf.'s Response, Assignment.) Thereafter, Schedule K-1 forms were issued for plaintiff by JFC and showed plaintiff's status and income as a general partner, limited partner and subordinated limited partner in JFC.
In January 1989, plaintiff became responsible for customer billing, new accounts and listed executions. (Pope Affid. at 2.) In September 1993, plaintiff was informed that effective December 31, 1993, her status as general partner would be terminated. (Rhoads Affid. at 3; Pope Affid. at 2.)
Under the Partnership Agreement,2 the general partners have exclusive right to manage the business of the partnership and are authorized to, inter alia, execute any instruments on behalf of the partnership, acquire or sell assets of the partnership, and enter into loans or guarantees in connection with the business of the partnership. (Agreement, art. IV § 4.1(C).)
Under the Partnership Agreement, a managing partner is designated by the general partners. (Agreement, art. IV § 4.1(B).) The managing partner possesses the absolute right to manage the business of the partnership or behalf of the general partners and controls the management and conduct of all of the business transacted by the partnership. (Agreement, art. IV § 4.1(B).) In addition, the managing partner is authorized to, inter alia, admit new general partners to the partnership, dismiss any general partner from the partnership, determine each general partner's adjusted capital contribution and related general partner percentage, determine the guaranteed draw to be paid to each general partner, and execute all documents on behalf of the partnership. (Agreement, art. IV § 4.1(B).) Consent of the general partners is not required for the managing partner to admit additional general partners to the partnership. (Agreement, art. III § 3.2(A).) The authority of the general partners to act as agents of the partnership and to execute instruments in the partnership's name is not restricted by the authority granted to the managing partner. (Agreement, art. IV § 4.1(D).)
The Partnership Agreement also provides for an executive committee of the partnership. The executive committee consists of the managing partner and nine additional general partners. (Agreement, art. IV § 4.4(A).) The general partners may vote to remove any member of the executive committee and elect a new member in his/her place. (Agreement, art. IV § 4.4(G).) The executive committee may vote to remove the managing partner and may vote to elect the managing partner when the office is vacant. (Agreement, art. IV § 4.4(D).) The managing partner may appoint and dismiss any member of the executive committee except those members elected by the general partners. (Agreement, art. IV § 4.4(F), (H).) The executive committee meets weekly to discuss the management of the firm. (Rhoads Affid. at 5.)
Under the Partnership Agreement, the general partners...
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