Opinion
No. 1: 00cv280-T.
February 23, 2001
MEMORANDUM AND RECOMMENDATION
THIS MATTER is before the court upon defendant's Motion for Partial Dismissal. Having carefully considered that motion and reviewed the pleadings, the undersigned enters the following findings, conclusions, and recommendation.
FINDINGS AND CONCLUSIONS
I. Background
Plaintiff filed this action in state court on November 6, 2000, and alleged causes of action for breach of contract, unlawful termination in violation of public policy, unfair and deceptive trade practices, and a violation of the Employee Retirement Security Act ("ERISA"). Defendant timely removed the action to this court under the original jurisdiction of this court, due to the presence of a federal question. Plaintiff's complaint surrounds his August 24, 1998, termination after 28 years of employment with Sears. Plaintiff contends that defendant did not follow its own well-established employment and discipline policies. Defendant has moved to dismiss the third and fourth causes of action. Plaintiff has not contested defendant's Motion to Dismiss the third cause of action (breach of contract), leaving the fourth cause of action (unfair and deceptive trade practices) for substantive decision.
II. Standard
Defendant has moved for dismissal pursuant to Rule 12(b), Federal Rules of Civil Procedure, contending that plaintiff has failed to state a cognizable claim. Rule 12(b) authorizes dismissal based upon a dispositive issue of law. Neitzke v. Williams, 490 U.S. 319, 109 S.Ct. 1827, 1832 (1989); Hishon v. King Spalding, 467 U.S. 69, 73 (1984); Conley v. Gibson, 355 U.S. 41 (1957). As the Court discussed in Neitzke:
This procedure [for dismissal], operating on the assumption that the factual allegations in the complaint are true, streamlines litigation by dispensing with needless discovery and fact finding. Nothing in Rule 12(b)(6) confines its sweep to claims of law which are obviously insupportable. On the contrary, if as a matter of law "it is clear that no relief could be granted under any set of facts . . . a claim must be dismissed, without regard to whether it is based on outlandish legal theory. . . . What Rule 12(b)(6) does not countenance are dismissals based on a judge's disbelief of a complaint's factual allegations.Id., at 1832 (citation omitted). For the limited purpose of ruling on defendant's motion, the court has accepted as true the facts alleged by plaintiff in the complaint and viewed them in a light most favorable to plaintiff.
III. Discussion
A. Dismissal of the Third Cause of Action
The undersigned has considered defendant's Motion to Dismiss plaintiff's third cause of action. Review of plaintiff's response reveals that plaintiff has presented no reasons why the proposed relief should not be granted. The undersigned, therefore, will recommend that plaintiff's third cause of action be summarily dismissed with prejudice for the reasons provided in defendant's supporting memorandum of law.
B. Dismissal of the Fourth Cause of Action
Defendant has moved to dismiss plaintiff's claim for unfair and deceptive trade practices, contending that plaintiff has failed to state a cause of action under current state law. N.C. Gen. Stat. § 75-1.1. Plaintiff's claim is based upon alleged deviation from written policies or a claimed course of conduct in relation to employee discipline procedures.
In Buie v. Daniel International Corp., 289 S.E.2d 118 (N.C.App. 1982), the North Carolina Court of Appeals held that "employer-employee relationships do not fall within the intended scope of 75-1.1," but, instead, "[e]mployment practices fall within the purview of statutes adopted for that express purpose." Id. at 120; accord Ausley v. Bishop, 515 S.E.2d 72 (N.C.App. 1999). North Carolina courts have, subsequent toBuie, found Section 75-1.1 applicable in only two situations:
(1) where restrictive covenants are made between the employer and employee, United Laboratories, Inc. v. Kuykendall, 370 S.E.2d 375 (N.C. 1988); and
(2) where an employee engages in business practices involving self-dealing that are against the interests of his employer, Sara Lee Corp. v. Carter, 519 S.E.2d 308 (N.C. 1999).
Plaintiff's argument that Sara Lee invalidated the decision in Buie is not supported by a close reading of that case. Indeed, the North Carolina Supreme Court specifically distinguished its holding from Buie finding that Buie was "neither applicable nor instructive in deciding the case before us." Id. at 312. The Sara Lee court found that because defendant's self-dealing occurred in a commercial transaction between defendant/employee and plaintiff/employer as buyer and seller, the defendant/employee could not use his employment status as a shield to a Chapter 75-1.1 claim related to the commercial transaction. Id.
Relying upon Johnson v. First Union Corp., 496 S.E.2d 1 (N.C.App. 1998), plaintiff further contends that anything less than abolition ofBuie would mean that employees who have workers' compensation claims, but continue employment, would have substantially fewer remedies. TheJohnson decision cited is no longer valid law, inasmuch as the appellate court substituted Johnson v. First Union Corp., 504 S.E.2d 808 (N.C.App. 1998), which granted summary judgment for the employer and held that the Workers' Compensation Act was a comprehensive regulatory scheme, preventing collateral attack even by former employees under Chapter 75-1.1. The undersigned must find that plaintiff has not stated a cause of action under current North Carolina law and will recommend dismissal of such claim with prejudice.
RECOMMENDATION
IT IS, THEREFORE, RESPECTFULLY RECOMMENDED that defendant's Motion for Partial Dismissal be ALLOWED and that plaintiff's third and fourth causes of action be DISMISSED with prejudice for the reasons discussed above.
The parties are hereby advised that, pursuant to 28, United States Code, Section 636(b)(1)(C), written objections to the findings of fact, conclusions of law, and recommendation contained herein must be filed within ten (10) days of service of same. Failure to file objections to this Memorandum and Recommendation with the district court will preclude the parties from raising such objections on appeal. Thomas v. Arn, 474 U.S. 140 (1985), reh'g denied, 474 U.S. 1111 (1986); United States v. Schronce, 727 F.2d 91 (4th Cir.), cert. denied, 467 U.S. 1208 (1984).
This Memorandum and Recommendation is entered in response to defendant's Motion for Partial Dismissal (#5).