Thomason v. Mitsubishi Elec. Sales America, Inc.
| Decision Date | 19 December 1988 |
| Docket Number | Civ. A. No. 1:88-CV-1901-MHS. |
| Citation | 701 F. Supp. 1563 |
| Parties | Edward THOMASON, Plaintiff, v. MITSUBISHI ELECTRIC SALES AMERICA, INC., et al., Defendants. |
| Court | U.S. District Court — Northern District of Georgia |
William J. McKenney, McKenney & Froelich, Atlanta, Ga., for plaintiff.
John G. Creech, Haynsworth Baldwin Miles, Johnson Breckenridge & Harper, Jacksonville, Fla., Richard A. Whiting, Mark D. Whitener, Steptoe & Johnson, Washington, D.C., D. Barclay Edmundson, Paula L. Lehmann, Munger Tolles & Olson, Los Angeles, Cal., for defendants.
Presently before the Court are defendants' motion for additional time to answer plaintiff's complaint, defendants' motion for judgment on the pleadings on plaintiff's first cause of action, and defendants' motion to dismiss plaintiff's second, third and fourth causes of action. The Court will grant the motion for an extension of time nunc pro tunc. The remaining motions will be discussed below.
Plaintiff Edward Thomason ("Thomason") served as regional sales manager in the Atlanta office of defendant Mitsubishi Electric Sales America, Inc. ("Mitsubishi") from August 1, 1982, until December 31, 1986. Mitsubishi, a Delaware corporation with headquarters located in Cypress, California, develops, manufactures, markets and distributes consumer electronic products throughout the United States and Europe. Although Thomason never had a formal contract with Mitsubishi, he claims Mitsubishi promised him lifetime employment when he was hired.
In December 1986, Mitsubishi's Southeast Regional Vice President Henry Dekker ("Dekker") fired plaintiff from his position with Mitsubishi. Dekker acted with the concurrence of Mitsubishi's Senior Regional Sales Manager for the Southeast Region, William Jennings ("Jennings"). According to Dekker and Jennings, Thomason was terminated because of dissatisfaction with his performance as Mitsubishi's regional sales manager for Atlanta.
On March 18, 1987, Thomason filed a complaint in the United States District Court for the Northern District of Georgia seeking damages for antitrust violations under the Sherman and Clayton Acts and for wrongful discharge and breach of contract. In essence, Thomason claimed that his termination occurred because of his refusal to enforce illegal price maintenance policies promulgated by Mitsubishi. Thomason asserted that Mitsubishi Vice Chairman Sterling Saake ("Saake") and Mitsubishi Executive Vice President Terry O'Flynn ("O'Flynn") adopted the illegal pricing scheme and that Dekker and Jennings were responsible for its enforcement in the Southeast region. All four were named as defendants along with Mitsubishi.
Mitsubishi sought dismissal of most of Thomason's claims based upon lack of standing under the antitrust laws, failure to state a claim under Georgia law, and lack of personal jurisdiction over California defendants Saake and O'Flynn. On October 26, 1987, while these motions were pending before United States District Court Judge Robert L. Vining, Jr., Thomason voluntarily dismissed his complaint without prejudice.
On December 16, 1987, plaintiff filed the current action in the United States District Court for the Central District of California. In his complaint, Thomason sought damages for violation of the Sherman and Clayton Acts, wrongful discharge, breach of the covenant of good faith and fair dealing, and intentional infliction of emotional distress.1 As he had alleged in the earlier action, plaintiff claimed that he was fired because he refused to continue enforcing Mitsubishi's price maintenance policies and because Mitsubishi feared that his continued employment would prompt detection of its illegal activity. Defendants moved to transfer the action to the United States District Court for the Northern District of Georgia based on improper venue pursuant to 28 U.S.C. § 1406(a) or under the doctrine of forum non conveniens pursuant to 28 U.S.C. § 1404(a). The motion to transfer for improper venue became moot when plaintiff voluntarily dismissed Georgia defendants Dekker and Jennings on March 10, 1988.
On July 29, 1988, United States District Court Judge William D. Keller granted defendants' motion to transfer the case to the United States District Court for the Northern District of Georgia under 28 U.S.C. § 1404(a). The Court found that the action could have been brought in this district and that judicial economy would be promoted by transfer because a similar suit had previously been filed here and, under California choice of law rules, plaintiff's state law claims probably would be decided according to Georgia law. The Court also noted that Atlanta appeared to be a more convenient forum for the witnesses as well as for plaintiff.
Along with their motion to transfer, defendants filed a motion to dismiss plaintiff's claims of wrongful discharge, breach of the covenant of good faith and fair dealing and intentional infliction of emotional distress that is now before the Court. Defendants claim that under California choice of law rules, Georgia law governs these claims. Because Georgia law does not recognize tort or contract claims for wrongful termination, defendants contend that plaintiff's second and third causes of action must be dismissed. Plaintiff argues that under California choice of law rules, California law applies to this case. If plaintiff is correct in that assertion, he has stated claims under California wrongful termination law.
Although Thomason maintains that jurisdiction in this Court exists because of the federal antitrust claims contained in his first cause of action, the Court must address his pendent state law claims according to the principles established for diversity cases in Klaxon Co. v. Stentor Electrical Manufacturing Co., 313 U.S. 487, 61 S.Ct. 1020, 85 L.Ed. 1477 (1941). Under Klaxon a federal court applies the state law of the courts in the state where it is located. Where a case is transferred to a more convenient forum based on 28 U.S.C. § 1404(a), however, the court is obligated to apply the state law that would have applied absent the change in venue. Van Dusen v. Barrack, 376 U.S. 612, 639, 84 S.Ct. 805, 820, 11 L.Ed.2d 945 (1964). As the Supreme Court stated in Van Dusen, "A change of venue under § 1404(a) generally should be, with respect to state law, but a change of courtrooms." Id. The Court must determine the applicable law in this case under California choice of law rules because those rules would have applied in the United States District Court for the Central District of California. See Roofing & Sheet Metal Services v. La Quinta Motor Inns, 689 F.2d 982, 989, 991-93 (11th Cir.1982).
California utilizes a "governmental interest" approach to choice of law problems. Ledesma v. Jack Stewart Produce, Inc., 816 F.2d 482, 484 (9th Cir.1987) (citations omitted). Under the governmental interests approach, the court must "find the proper law to apply based upon the interests of the litigants and the involved states." Reich v. Purcell, 67 Cal.2d 551, 553, 63 Cal.Rptr. 31, 432 P.2d 727 (1967). A "true conflict" exists only if the states involved have different laws and each state has a "legitimate but conflicting interest in applying its own law." Bernhard v. Harrah's Club, 16 Cal.3d 313, 319, 128 Cal. Rptr. 215, 546 P.2d 719 (1976). If a true conflict is present, California courts resolve the matter based on a "comparative impairment" analysis. "This analysis proceeds on the principle that true conflicts should be resolved by applying the law of the state whose interest would be the more impaired if its law were not applied." Id. at 320, 128 Cal.Rptr. 215, 546 P.2d 719.
The parties agree that Georgia and California law differ with regard to employment termination. Under Georgia law, "an indefinite hiring may be terminated at will by either party." O.C.G.A. § 34-7-1 (1988). As the Georgia Supreme Court held in Georgia Power Co. v. Busbin, 242 Ga. 612, 250 S.E.2d 442 (1978) (per curiam), at-will employment in Georgia "gives rise to no cause of action against the employer for alleged wrongful termination." Id. at 613, 250 S.E.2d 442. Georgia courts have not allowed any exceptions to this statutory rule. See, e.g., Goodroe v. Georgia Power Co., 148 Ga.App. 193, 251 S.E.2d 51 (1978). California, on the other hand, is one of a growing number of states where "courts have recognized that an employer's traditional broad authority to discharge an at-will employee `may be limited by statute ... or by considerations of public policy.'" Tameny v. Atlantic Richfield Co., 27 Cal.3d 167, 172, 164 Cal.Rptr. 839, 27 Cal.3d 167 (1980) (citations omitted).
Notwithstanding this clear divergence between Georgia and California law, Mitsubishi contends that a "true conflict" does not exist in this case. Defendants argue that because Thomason was employed at all relevant times in Georgia, California has no interest in providing him the benefits of its wrongful termination law. Defendants maintain that California's interest is limited to protection of California resident employees who are unexpectedly terminated. This argument ignores, however, the Supreme Court of California's holding in Tameny:
An employer's authority over its employee does not include the right to demand that the employee commit a criminal act to further its interests, and an employer may not coerce compliance with such unlawful directions by discharging an employee who refuses to follow such an order. An employer engaging in such conduct violates a basic duty imposed by law upon all employers....
Id. at 178, 164 Cal.Rptr. 839, 610 P.2d 1330. The Court finds that California has a significant interest in preventing California employers from violating duties imposed on them by California law. Defendants' argument that a "true conflict" is not present here lacks merit.
As stated previously, California courts resolve "true...
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...681 F.2d 514 (7th Cir.1982); Boisjoly v. Morton Thiokol, 706 F.Supp. 795, 804-05 (D.Utah 1988); Thomason v. Mitsubishi Electric Sales of America, Inc., 701 F.Supp. 1563, 1570 (N.D.Ga.1988); Reitz v. Canon USA Inc., 695 F.Supp. 552, 553-54 (S.D.Fla.1988), and Haigh v. Matsushita Electric Cor......