Riley v. Dow Corning Corp.

• Citation: 767 F. Supp. 735
• Decision Date: 24 July 1991
• Docket Number: No. C-89-486-G.,C-89-486-G.
• Court: United States District Courts. 4th Circuit. Middle District of North Carolina
• Parties: Harold Gene RILEY, Plaintiff, v. DOW CORNING CORPORATION; Hubert F. (Joe) Brooks; Hilda Garris; Bennett Keith Wagoner; B. Matthew Petcoff; and Gary T. Berner, Plan Administrator of Dow Corning Corporation Employee Retirement Plan, Defendants.

767 F. Supp. 735

Harold Gene RILEY, Plaintiff, v. DOW CORNING CORPORATION; Hubert F. (Joe) Brooks; Hilda Garris; Bennett Keith Wagoner; B. Matthew Petcoff; and Gary T. Berner, Plan Administrator of Dow Corning Corporation Employee Retirement Plan, Defendants.

No. C-89-486-G.

United States District Court, M.D. North Carolina, Greensboro Division.

July 24, 1991.

COPYRIGHT MATERIAL OMITTED

Harry G. Gordon, Greensboro, N.C., for plaintiff.

Frank P. Ward, Jr., Maupin, Taylor, Ellis & Adams, P.A., Raleigh, N.C., for defendants.

MEMORANDUM OPINION

ERWIN, Chief Judge.

This matter comes before the court upon the defendants' summary judgment motion, pursuant to Rule 56 of the Federal Rules Civil Procedure. Both sides have briefed the issues, and the matter is now ripe for a ruling. The court hereby rules that defendants' summary judgment motion as to the plaintiff's ERISA, age discrimination, wage and overtime compensation, negligence, intentional infliction of emotional distress, and libel and slander claims is granted. The court also grants defendants Garris and Berner's motion as to the tortious contract interference claim and Garris's motion on the civil conspiracy issue. The defendants' motion on all remaining issues is denied.

Factual Summary

On July 15, 1987, one of the defendants, Dow Corning Corporation (Dow Corning), terminated plaintiff Harold Gene Riley (Riley) from employment. His termination occurred after an internal investigation determined that Riley had failed to perform product tests and that he falsified records to show that he had in fact performed these tests.

Plaintiff Riley denied the findings of the internal investigation. He sued his employer and several Dow Corning employees who allegedly contributed to his termination. Plaintiff's complaint included nine claims against the defendants: (1) tortious contract interference, (2) libel and slander, (3) intentional infliction of emotional distress, (4) tortious conspiracy, (5) negligence, (6) wrongful discharge, (7) age discrimination in violation of the Age Discrimination in Employment Act of 1967 (ADEA), 29 U.S.C. §§ 621, et seq. (West 1985 & Supp.1991), (8) failure to pay wage and overtime compensation in violation of the Fair Labor Standards Act of 1938 (FLSA), 29 U.S.C. §§ 201, et seq. (West 1965 & Supp.1991), and (9) failure to disclose information on employment benefits pursuant to the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001, et seq. (West 1985 & Supp. 1991). The defendants moved for summary judgment on all causes of action, arguing that no material facts existed and that they should receive judgment as a matter of law.

Legal Discussion

Summary Judgment Standard

The grant or denial of the defendants' summary judgment motion hinges on two factors. One, it depends upon the existence or nonexistence of undisputed relevant facts. "Summary judgment is proper only when it is clear that there is no dispute concerning either the facts of the controversy or the inferences to be drawn from those facts." Pulliam Invest. Co. v. Cameo Properties, 810 F.2d 1282, 1286 (4th Cir.1987) (emphasis added). See Birdwhistle v. Kansas Power and Light Co., 723 F.Supp. 570, 574 (D.Kan.1989) ("Where different ultimate inferences may be drawn from the evidence presented by the parties, the case is not one for summary judgment.").

Two, the defendants must be entitled to judgment as a matter of law. A summary judgment motion should be granted "against a party who fails to make a showing sufficient to establish the essential elements of that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). In this discussion, the nine claims of plaintiff Riley will be addressed in turn.

Tortious Contract Interference

The plaintiff contended that defendants Hubert F. Brooks (Brooks), Hilda Garris (Garris), Bennett Keith Wagoner (Wagoner), B. Matthew Petcoff (Petcoff), and Gary T. Berner (Berner), all Dow Corning employees, tortiously interfered with his Dow Corning employment contract. In order to prove this claim under North Carolina law, Riley must show:

(1) a valid contract between the plaintiff and a third person which confers upon the plaintiff a contractual right against a third person; (2) the defendant knows of the contract; (3) the defendant intentionally induces the third person not to perform the contract; (4) and in doing so acts without justification; (5) resulting in actual damage to plaintiff.

United Laboratories, Inc. v. Kuykendall, 322 N.C. 643, 661, 370 S.E.2d 375, 387 (1988) (citations omitted). This claim for wrongful interference is not barred by Riley's at-will employment. Sides v. Duke University, 74 N.C.App. 331, 328 S.E.2d 818, disc. rev. denied, 314 N.C. 331, 333 S.E.2d 490 (1985).

The defendants maintained that the third and fourth prongs of this legal standard cannot be proved by Riley. They argued that the plaintiff offered no evidence that any defendant induced the nonperformance of his contract and that if such acts occurred, this inducement was justified. Under North Carolina law, the defendants will not be liable if the protection of a legitimate business interest prompted their actions. Privette v. University of North Carolina, 96 N.C.App. 124, 134, 385 S.E.2d 185, 190 (1989); Murphy v. McIntyre, 69 N.C.App. 323, 329, 317 S.E.2d 397, 401 (1984) (proof of actual malice insufficient to overcome legal justification). Defendants Brooks, senior quality assurance specialist and plaintiff's supervisor, and Petcoff, reliability engineer, suggested that they were legally justified in complaining to Greensboro Plant Manager Leonard about Riley's poor job performance and improper record keeping. They reported that he had not performed certain product tests and had falsified his testing records.

The other three defendants, Wagoner, Garris, and Berner, characterized their involvement in this controversy as minimal. According to them, Lab Technician Wagoner merely helped Brooks and Petcoff search for the missing test cups, and Personnel Administrator Garris stated that she only drafted Riley's termination letter and the letter informing him about employment benefits. Berner served as the plan administrator for the Dow Corning Employee Retirement Plan.

To the contrary, the plaintiff presents conflicting evidence which prevents a summary judgment ruling in favor of Brooks, Petcoff, and Wagoner. The court finds that important questions exist concerning the quality of Riley's work performance, the defendants' hostility toward him, and the circumstances surrounding his termination. For instance, the defendants argued that the plaintiff was a poor worker and received less than positive work reviews. Yet, two and one-half months before his termination, Riley received Dow Corning's 1987 Management Achievement Award. He was fired two weeks before the formal banquet recognizing him would have been held.

The plaintiff also noted that the defendants were hostile to him. Defendant Garris was hostile to Riley because Riley's wife reported the hiring of defendant Garris's son, a violation of company policy. He further alleged that Garris's daughter and her friend attacked plaintiff's daughter in a public place and beat her about the head and face. As for defendant Wagoner, Riley reported to his supervisor, Brooks, that Wagoner, Brooks' friend, failed to perform certain tests, and this created tensions between the plaintiff and defendants Wagoner and Brooks. After the incident between Riley and Wagoner, defendant Petcoff told the plaintiff, "Someone in the Department wants you out."

More importantly, the crucial events that led to the plaintiff's termination involved defendants Brooks, Petcoff, and Wagoner. In June 1987, Brooks and Petcoff, the plaintiff's supervisors, instructed him to throw out the test samples he usually retained. On July 13, 1987, the date of Riley's suspension, Brooks, Petcoff, and Wagoner went to plaintiff's work area and closely observed his work. He felt that they were "watching him like a hawk." He stated that after he ran the tests properly and threw the test samples in a trash can, defendant Brooks volunteered to throw out the trash. The trash can containing the test samples should have held twelve cups of tested product, but the defendants stated that it contained three. Brooks and Petcoff reported to Greensboro Plant Manager Leonard that Riley had not performed product tests properly and had falsified his testing records. The plaintiff was suspended later that day and terminated two days later.

Several weeks after Riley's dismissal, eight cups containing product sample were anonymously mailed to the plaintiff's legal counsel, Jonathan Harkavy. Riley examined these cups and suggested that these cups were the ones used in the tests he allegedly did not perform.

In light of the factual and legal support presented by Riley, the court finds that Riley's claim cannot justify a ruling that defendants Garris and Berner tortiously interfered with the contract between Riley and Dow Corning. Despite the hostilities between Riley and Garris and the alleged scuffle between their daughters, the plaintiff has not shown how Garris affected Dow Corning's decision to terminate him. Likewise, the court finds that Retirement Plan Administrator Berner did not affect the termination decision and should not be found liable for tortious contract interference.

Rule 56 does not, however, favor the other three defendants. Although both Brooks and Petcoff raised as defenses the protection of a legitimate business interest, this privilege "is conditional and qualified; that is, it is lost if exercised for a wrong purpose. In general a wrong purpose exists where the act is done other than as a reasonable and bonafide (sic) attempt to protect the interests of the defendant which is involved." United...