46 Fair Empl.Prac.Cas. 824,
3 Indiv.Empl.Rts.Cas. 380
Marvin BERNSTEIN, Plaintiff-Appellant,
v.
AETNA LIFE & CASUALTY; Aetna Casualty and Surety Company, a
Connecticut corporation; Aetna Casualty and Surety Company
of America, a Connecticut corporation; Aetna Casualty and
Surety Company of Illinois, a Connecticut corporation;
Aetna Fire Underwriters Insurance Company, a Connecticut
corporation; Aetna Life Insurance and Annuity Company, a
Connecticut corporation; Aetna Life Insurance Company, a
Connecticut corporation; Aetna Life Insurance Company of
Illinois, an Illinois corporation; Greg M. Fischer,
husband; Jane Doe Fischer, wife, Defendants-Appellees
No. 86-2358.
United States Court of Appeals,
Ninth Circuit.
Argued and Submitted Dec. 16, 1987.
Decided March 31, 1988.
Grace McIlvain, Miller & Pitt, P.C., Tucson, Ariz., for plaintiff-appellant.
David J. Hamilton, O'Melveny & Myers, Los Angeles, Cal., for defendants-appellees.
Appeal from the United States District Court for the District of Arizona.
Before FLETCHER, WIGGINS and NOONAN, Circuit Judges.
WIGGINS, Circuit Judge:
Marvin Bernstein appeals partial summary judgment for Aetna Life & Casualty ("Aetna") and summary judgment for Greg Fischer. Bernstein was fired by Aetna, and he sued the company and his immediate supervisor, Fischer. Bernstein claimed (1) age discrimination under the Age Discrimination in Employment Act (ADEA), 29 U.S.C. Secs. 621-634 (1982), and the Arizona Civil Rights Act (ACRA), Ariz.Rev.Stat.Ann. Secs. 41-1461-1465 (1985 & Supp.1987), (2) religious discrimination under Title VII, 42 U.S.C. Secs. 2000e et seq., and the ACRA, (3) wrongful discharge, (4) breaсh of an implied employment contract, and (5) tortious interference with a business relationship. The district court granted summary judgment to defendant Fischer on all counts, and to Aetna on counts 3, 4 and 5. We reverse and remand.
BACKGROUND
Bernstein worked for Aetna 24 years. His last position was as the District Manager of the Tucson District Office of the Phoenix Career General Agency. Bernstein claims he was told when he joined Aetna that it was a lifetime career аnd there would always be a position at Aetna for someone who did well. These alleged promises were reinforced by later statements by superiors and others. Since Bernstein had previously held a supervisory position with Aetna, he claimed to know of Aetna's personnel policies and practices. He alleged it was Aetna's policy or practice that long-term employees who encountered performanсe difficulties would be counseled, transferred, or offered a demotion, but would not be terminated unless they were guilty of wrongdoing such as embezzling or misallocating funds. Bernstein claims he relied on Aetna's written personnel policies setting forth detailed procedures for warning and probation periods.
In May, 1980, Greg Fischer became the General Agent in Phoenix and thus Bernstein's supervisor. Bernstein claims Fischer was prejudiced against him as a Jew and as аn older employee. In October, 1982, Fischer put Bernstein on written warning. This was, Aetna claims, prompted by Bernstein's failure to meet certain standards in the years 1980, 1981, and the first half of 1982. After the warning period, Bernstein was put on probation. He was again given a ninety-day goal to meet. Bernstein was fired on April 29, 1983.
On October 11, 1983, Bernstein filed a charge of age and religious discrimination with the Equal Employment Opportunity Commission ("EEOC") and the Arizona Civil Rights Division ("ACRD"), naming Aetna as the sole respondent and alleging that John Michael, a vice-president of Aetna, was responsible for his termination. Greg Fischer was not mentioned by name or title. The ACRD investigated the matter and found that there was "no cause" to believe that Aetna had discriminated against Bernstein.
On October 4, 1984, Bernstein and his wife filed a five-count complaint against Aetna, as well as against Greg Fischer and his wife. The district court later dismissed the wives from this action. The district court also dismissed the age and religious discrimination claims against Greg Fischer, under both Arizona and federal law. The court also dismissed the common law claims (counts 3, 4, and 5) against Fischer for lack of pendent jurisdiction. Upon motion, the district court permitted Bernstein to amend his complaint to allege diversity jurisdiction in addition to federal question jurisdiction, thus, in effect, reinstating the state-law claims against Fischer. Bernstein filed an amended complaint tо this effect. Thereafter, the district court granted summary judgment to Aetna and Fischer on counts 3, 4, and 5, and to Fischer alone on counts 1 and 2. The district court entered final judgment, pursuant to Fed.R.Civ.P. 54(b), on these counts. As a result, only the age and religious discrimination claims against Aetna remain in the district court. Bernstein timely appeals.
ANALYSIS
A. Standard of Review.
A district court's grant of a motion for summary judgment is reviewed by the appellate court de novo. The general standard an aрpellate court applies in reviewing the grant of such a motion is the same as that employed initially by the district court under Fed.R.Civ.P. 56(c). Allen v. A.H. Robins Co.,
B. Failure to Name Fischer in the Administrative Charge.
The district court granted Fischer's motion to dismiss on counts 1 and 2 for lack of subject matter jurisdiction. The basis for this dismissal was that Bernstein's charge of discrimination filed with the ACRD did not name Fischer. There is no question that Fischer is not mentioned by name in the charge.
The court below ruled that Bernstein had failed to allege facts in the charge from which the court could infer that the unnamed party violated Title VII or the ADEA. See Chung v. Pomona Valley Community Hosp.,
We rule that even using the standard employed by the district court, Fisher's dismissal was not warranted because even though not named in the administrative charge, the facts alleged therein make out a claim against him.
C. Retroactivity of Arizona Court Decisions Allowing Common Law Actions for At-Will Employees.
The district court granted summary judgment on counts 3, 4, and 5 on two rationales. The first ground was that each of these counts was erroneously premised on two Arizona Supreme Court cases, Leikvold v. Valley View Community Hosp.,
In Arizona, there is a presumptiоn that decisions relating to civil matters have retroactive effect. Hawkins v. Allstate Ins. Co.,
The parties vigorously dispute whether the decisions in Wagenseller and Leikvold were foreshadowed in previous decisions by Arizona courts. Aetna suggests that the previous rule of an at-will employer's complete freedom to discharge employees, established in Dover Copper Mining Co. v. Doenges,
Even if the foreshadowing prong of the Chevron Oil test is not decisive, Bernstein has persuasively argued that the purpose and inequity factors also weigh against a finding of solely prospective effect. While Aetna has suggested that application of the old rule to discharges occurring before Wagenseller "will more faithfully serve the goals of predictability and order than would be the case if [the court] retroactively imposed the new [rules]" (quoting Wiltshire v. Standard Oil Co.,
Morеover, Arizona courts have already decided that Leikvold and Wagenseller be given retroactive effect. Indeed, the Arizona Supreme Court in Wagenseller specifically applied Leikvold 's grant of a cause of action for breach of an implied employment contract, based on the terms of a personnel manual, to a cause of action which arose five years before Leikvold was decided. Wаgenseller,
The court below apparently substituted its own analysis of the issue of retroactivity for that of the Arizona courts. This ground for the district court's grant of summary judgment on counts 3, 4, and 5 was, therefore, error.
D. ACRA Preemption of Bernstein's Wrongful Discharge Count.
The district court also ruled that the Arizona Civil Rights Act preempts Bernstein's wrongful discharge count. To decide this issue, we must determine what the Arizona Supreme Court would rule. See American Triticale, Inc. v. Nytco Serv., Inc.,
Bernstein argues, however, that the Arizona Supreme Court's recent decision in Ford v. Revlon, Inc.,
The ruling in Ford, that it is permissible to bring an action in both state and federal courts based upon two separate and distinct causes of action does, however, have some bearing on this issue. Arizona courts have ruled that the ACRA is "substantially identical" with federal legislation, that the "Arizona legislature intended to accomplish the same objectives" and that federal precedent under Title VII is "instructive and apposite." Civil Rights Div. v. Superior Court,
It is well-established that Title VII doеs not preempt state common law remedies. See Cancellier v. Federated Dep't Stores,
Bernstein argues that the ACRA did not create the rights which he relies on for this action. After all, Title VII, the ADEA and the Civil War-Era Civil Rights Acts, 42 U.S.C. Secs. 1981, 1983, 1985 (1982), all predated the enactment of the ACRA. Aetna responds that prior tо the ACRA there were absolutely no rights or remedies under Arizona law regarding age or religious discrimination in employment. But the rule of preemption does not seem to discriminate between remedies available under state law and those offered by federal law. Moreover, the clear ruling of the Arizona Supreme Court in Ford is that neither Title VII nor the ADEA preempts state common law causes of action.
E. Summary Judgment on the Breach of Contract Claim.
Count 4 of Bernstein's complaint alleged two forms of breach of employment contract. The first ground argued by Bernstein was that Aetna's personnel policies were an implied-in-fact contract term. The second ground was that the contract included an implied-in-law covenant of good faith and fair dealing. The district court was correct in dismissing the second ground for this count, but erred in discounting the first theory.
The Arizona Supreme Court itself in Wagenseller,
Bernstein's breach-of-contract claim is also premised on Aetna's implied-in-faсt personnel policies and this theory is more firmly grounded. Nevertheless, the district court ruled that
Bernstein's reliance on the personnel manual is insufficient to bring him within Wagenseller. The mere fact that the manual existed standing alone with no evidence of representations by Aetna management to Bernstein regarding its contents, no reliance by Bernstein, and no evidence that the manual was used in the Fischer agency did not create an implied сontract arising from the manual.
But "[w]hether any particular personnel manual modifies any particular employment-at-will relationship and becomes part of the particular employment contract is a question of fact." Leikvold,
The district court's judgment on this issue was error. First, the court placed too much emphasis on the factual issue of Bernstein's reliance on the personnel policies. In Wagenseller, the Arizona Supreme Court said that "Leikvold does not require a plaintiff employee to show reliance in fact."
Aetna has argued that an implied-in-fact cоntract of the sort that Bernstein claims is barred by Arizona's Statute of Frauds, Ariz.Rev.Stat.Ann. Sec. 44-101(5) (1987). Aetna's argument is suspect. Aetna offers no precedent for Arizona's barring of an implied-in-fact contract by the Statute of Frauds. In California, the jurisdiction upon which Aetna relied, the case cited, Newfield v. Insurance Co. of the West,
Aetna has also suggested that even if an implied-in-fact contract were found to exist between Bernstein and Aetna, Aetna did not breach that contract. In short, Aetna alleges it followed its personnel procedures in firing Bernstein. This is also a question of fact. Moreover, the court below did not rule on this basis. It simply held that no implied contract arose from the manual. We reverse the district court's ruling of summary judgment on that part of Bernstein's breach-of-contract claim premised on Aetna's personnel policies.
F. Summary Judgment on Tortious Interference Claim.
The Arizona Supreme Court in Wagenseller clarified the elements of the tortious interference with an employment contract claim.
(1) The existence of a valid contractual relationship or business expectancy;
(2) knowledge of the relationship or expectancy on the part of the interferer;
(3) intentional interference inducing or causing a breach or termination of the relationship or expectancy;
(4) resultant damage to the party whose relationship or expectancy has been disrupted;
(5) "improper" interference as defined in the Restatement (Second) of Torts Sec. 766 (1979).
Antwerp Diamond Exch. v. Better Business Bureau of Maricopa County,
The court below based its summary judgment on Bernstein's сount 5 on his failure to show a valid contractual relationship or business expectancy. Because the court ruled as to count 4 that Bernstein did not have an implied-in-fact contract with Aetna, there could be no action for tortious interference. Disposition on this issue, therefore, is controlled by our decision above. Since we reverse the district court's decision that Bernstein did not have an implied contract with Aetna, we must reverse on this issue as well.
Aetna has argued that Fischer was a supervisor acting within the scope of his authority as an agent of Aetna, and that, therefore, Bernstein cannot claim interference because Aetna cannot be guilty of inducing a breach of its own alleged contract. This argument is meritless. It was specifically rejected in Wagenseller.
G. Attorneys' Fees.
Both Bernstein and Aetna have indicated that they will seek attorneys' fees if they prevail on this appeal. Given the current posture of this case, on appeal from summary judgment, attorneys' fees are denied at this time.
CONCLUSION
The decision of the district court is, therefore, REVERSED AND REMANDED.
Notes
Even if we were to apply the rule that Title VII charges can be brought against persons not named in an EEOC complaint as long as they were involved in the acts giving rise to the EEOC claims, Wrighten v. Metropolitan Hosp., Inc.,
