Peck v. NGM Insurance CV-94-90-B 06/21/95 UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Kathleen Peck

v. Civil No. 94-90-B

NGM Insurance Co., et al

O R D E R

Plaintiff, Kathleen Peck, filed this action against the

defendants, NGM Insurance Company ("NGM") and several of its

employees, alleging violations of both federal and state law.

Peck alleges that NGM violated the Egual Pay Act,

(d) (West 1978) and its New Hampshire counterpart,

(1987) (Count I), and the Fair Labor

Standards Act,

(a) (West Supp. 1995) (Count II).

She also alleges that NGM is liable for wrongful discharge (Count

III) and negligent supervision (Count VI ) . Finally, she claims

that several NGM employees1 intentionally interfered with her

contractual relations with NGM (Count IV), and that NGM is

liable for the individual defendants' actions under the doctrine

1The individual defendants are Samuel DeYoung, Robert Buchholz, and John Schwartz. of respondeat superior (Count VII).2 Defendants filed a motion

for summary judgment with respect to all of Peck's allegations.

For the following reasons I grant defendants' motion in part and

deny it in part.

I. FACTUAL BACKGROUND3

NGM is an insurance company that underwrites both commercial

and personal insurance lines. Its Risk Inspection Department

performs inspections of commercial properties and verifies basic

information of insured parties' businesses. NGM hired Peck in

1977 as a secretary in the Risk Inspection Department. Samuel

DeYoung, a risk manager, was her initial supervisor.4 At that

time, the department included DeYoung, two male field inspectors

and Peck. In 1984, the department was downsized to include only

DeYoung, whose title was changed to risk inspection supervisor,

and Peck whose title was changed to risk inspection assistant.

2Peck withdrew Count V of her complaint, alleging intentional infliction of emotional distress, in her objection to defendants' motion for summary judgment.

31hese facts are stated in the light most favorable to Peck.

4DeYoung ceased to be Peck's supervisor in the mid-1980's and, as discussed infra, he later resumed a supervisory role over her.

2 DeYoung was categorized as a pay grade 22 while Peck was a grade

15.

As a risk inspection supervisor, DeYoung was responsible for

identifying liability exposures of applicants for commercial

lines insurance who operated their businesses from a specific

location (e.g., office buildings, light manufacturing plants,

apartments, stores, and restaurants). DeYoung performed this

responsibility both by making on-site inspections and by

interviewing business owners. After completing an investigation,

DeYoung prepared a detailed narrative report that included a

description of the site, the business's operations, and any

potential liability hazards. His reports also included diagrams,

photographs, and recommendations for corrective action.

Peck's duties as a risk inspection assistant changed during

the time she was employed at NGM. Initially, she was responsible

for (i) acting as liaison between NGM and independent contractors

who performed risk inspections for NGM; (ii) assisting DeYoung

with his field inspections; (iii) using information obtained by

DeYoung to determine the value of an insured's buildings; and

(iv) providing clerical and technical support to underwriters.

At some point, she also began to perform "telephone inspections"

of contracting operations such as plumbers, electricians, general

3 contractors, or landscapers who were seeking to purchase

insurance from NGM. By 1989, she was performing telephone

inspections almost exclusively. At that time, she was assigned a

split shift of four hours in the morning and four hours in the

evening. In 1989, she was allowed to perform the telephone

inspections from her home.

Peck's telephone inspections were essentially interviews of

the business owners that followed a prescribed format. She was

reguired to determine the nature and extent of an applicant's

business by collecting information such as: (i) a description of

the business; (ii) its yearly sales figures and annual payroll

numbers; (iii) the names and numbers of its employees; (iv) a

description of the business's eguipment; (v) the average price of

a job; (vi) whether the insured used subcontractors; (vii) the

number of vehicles used by the business; (ix) any risks

associated with the business's buildings; (x) whether the

business had underground storage tanks on its premises; (xi)

whether the business performed any ultra-hazardous activities;

and (xii) whether the business had suffered any losses within the

previous three years. Peck recorded the information she obtained

on a one-page form and used additional pages to supplement the

form where necessary.

4 Peck prepared approximately thirty-five to forty reports per

week and it took her approximately forty-five minutes to conduct

each interview and prepare a report. Although she spent most of

her time conducting telephone interviews. Peck was also reguired

to attend six staff meetings per year and to assist NGM's

underwriters with "rush" jobs at a minimum of once per week. If

Peck was not on the telephone performing these other tasks or at

company meetings, she considered herself to be actively waiting

for work. Peck estimated that her typical work day lasted from

6:00 a.m. until 8:00 p.m. if this waiting-to-work time were

included.

Peck's flexibility in responding to calls during off hours

was considered a major strength by NGM. Further, a supervisor

indicated that she was doing an excellent job and that NGM's

insureds were fortunate because she was available at their

convenience. She was also cited as having a good work ethic and

"a passion for doing everything right."

Peck inguired about becoming a field inspector several times

during her employment. She was told both that due to downsizing

there were no positions available and that she lacked the

reguisite experience and training. DeYoung indicated to her that

he did not think it would be appropriate for a woman to perform

5 field inspections because of the areas where the inspections were

conducted. Peck also applied for other positions, including mail

room supervisor, but was unsuccessful in securing a new position.

In January 1993, Peck expressed to Thomas Aldrich, a human

resources representative, that she felt overwhelmed and that she

was working all the time, fourteen hours per day. Previously,

Peck had expressed similar concerns to other supervisors and

managers at NGM. According to Peck, no one at NGM ever told her

she should not be working those hours. She also did not believe

she could work a split shift since she was reguired to be

available during business hours to underwriters and agents.

Peck, however, never indicated on her time slips or evaluations

that she worked any overtime.

In February 1993, Robert Buchholz became the New England

Regional Underwriting Manager and managed both DeYoung and Peck.

At this time. Peck began working part-time at Friendly's in

addition to her work for NGM. During a conversation with

Buchholz after he became one of her supervisors. Peck stated that

she was "burnt out" and she did not like being in the house all

day waiting for insured parties to call her back. Thereafter,

Buchholz assigned a task force to reformulate the verification

6 forms Peck was using and after Peck left NGM, the forms were

revised so that they could be sent directly to insureds.

Buchholz also expressed concern about Peck's hours in a memo to

DeYoung and instructed him to monitor Peck's phone activity to

determine when she was experiencing the most "no hits" in order

to revise her schedule.

Pursuant to Buchholz's instructions, DeYoung reguested the

master pages of Peck's phone bill to verify that she was

deducting all her personal calls from the bill. He asked more

than once for the pages and Peck explained to him each time why

she could not give him past pages. Peck felt that his repeated

reguests were "nit-picky." After completing his review, DeYoung

made recommendations to Buchholz as to the most productive times

for making calls. Previously, Peck had been told to take Friday

afternoons off, but beyond that modification, no one assisted

Peck in restructuring her schedule.

On September 22, 1993, at 9:25 a.m., DeYoung again asked

Peck for the master page of her phone bill. Peck again explained

why she could not provide the master page and again asked DeYoung

why he was being so "nit-picky" lately. She also asked him if he

7 was doing to her what another worker used to do to his "girls."5

She further asked whether NGM wanted her to resign. DeYoung told

Peck that he would find out for her and get back to her that day.

At this time, DeYoung had no authority to accept a resignation,

hire, or fire employees. Peck called DeYoung back at 11:30 a.m.,

but he told her he had not yet spoken to Buchholz.

Eventually DeYoung told Buchholz that Peck had resigned.

Specifically, DeYoung stated that Peck became upset and said:

"Just take the phone out of my house, I quit." Two meetings took

place concerning Peck's alleged resignation and whether a verbal

resignation was valid. After consulting with his manager, John

Schwartz, Buchholz determined that he had the discretion to

accept a resignation over the phone and declined to discuss the

issue with Peck at all. At about 2:00 p.m., DeYoung, at

Buchholz's direction, called Peck to confirm her resignation

which Peck continued to deny making. Peck called the Human

Resources Department twice that day contesting her "resignation."

Later, Aldrich called Peck to inform her that the resignation was

effective at the end of the day. No one followed up on Peck's

5 Another worker at NGM apparently had the reputation of harassing his employees to the point that they would quit. allegations that she had not resigned.

II. DISCUSSION

A. Standard of Review

It is axiomatic that a court does not find facts in ruling

on a motion for summary judgment. Instead, the court construes

the evidence in the light most favorable to the nonmovant and

determines whether the moving party is entitled to judgment as a

matter of law. Oliver v. Digital Equip. Corp.,

(1st Cir. 1988); accord National Amusements, Inc. v. City of

Dedham, No. 91-1176, slip op. at 27 (1st Cir. Jan. 4, 1995)

(reasonable inferences are those that indicate an acceptable

level of probability based on common sense and human experience).

Where the nonmovant bears the burden of proof at trial, summary

judgment should be denied if the nonmovant produces "more than a

scintilla" of supporting evidence which, if believed, would be

sufficient to convince a reasonable fact finder that the

nonmovant's claim has been proved. Milton v. VanDorn Co.,

(1st Cir. 1992). Similarly, when the moving party

bears the burden of proof at trial, summary judgment is warranted

only if the movant is entitled to judgment as a matter of law on

the undisputed material facts. Fitzpatrick, 2 F.2d at 1116.

With these standards in mind I address the defendants' motion. B. The Equal Pay Act Claim

To establish a violation of the Equal Pay Act ("EPA") a

plaintiff must prove that

(1) she was performing work which was substantially equal to that of the male employees considering the skills, duties, supervision, effort, and responsibilities of the jobs; (2) the conditions where the work was performed were basically the same; and (3) the male employees were paid more under such circumstances.6

Tidwell v. Fort Howard Corp.,

(10th Cir. 1993);

Waters v. Turner, Wood & Smith Ins. Agency, Inc.,

(11th Cir. 1989) (per curiam) (quoting Corning Glass Works v.

Brennan,

(1974)); Brownlee v. Gav & Tavlor,

Inc.,

(D. Kan. 1985), aff'd ,

(10th Cir. 1988). While the compared jobs need not be identical,

the plaintiff must prove that the jobs require substantially

equal skill, duties, supervision, effort, and responsibilities.

Forsberq v. Pacific Northwest Bell Tel. Co.,

,

6 The New Hampshire statute uses similar language as the EPA. See

. Although there are no cases from the New Hampshire Supreme Court indicating the standard to be used under the statute, both parties rely on federal law as it is developed under the EPA. Because the parties do not argue that the state law standards differ from the federal precedents cited, I assume that state law provides no greater protection. See Mesnick v. General Flee. Co.,

, 829 n.ll (1st Cir. 1991), cert. denied,

(1992).

10 modified,

37,996 (9th Cir. 1988);

accord Corning Glass,

; Lex K. Larson, Employment

Discrimination, § T51.42 (2d ed. 1995). Further, in assessing

whether the jobs are substantially equal [t]he controlling

factor ... is job content--the actual duties of the respective

employees are called upon to perform'" Waters,

(quoting Pearce v. Wichita City,

(5th Cir.

1979)). This inquiry is a fact based determination and therefore

should be assessed on a case-by-case basis. Forsberq,

. But c f . Smith v. Stratus Computer, Inc.,

(1st Cir. 1994) (failure of proof of essential element by

nonmovant renders all other facts immaterial and summary judgment

should be granted), cert. denied,

(U.S. 1995).

If a plaintiff proves her prima facie case, the defendant

may escape liability by proving that the unequal pay is caused

by: (1) a seniority system; (2) a merit system; (3) a system

which measures earnings by quantity or quality of production; or

(4) a differential based on any other factor other than sex.

(d)(1); Winkes v. Brown Univ.,

(1st Cir. 1984) (citing Corning Glass,

).

Peck bases her Equal Pay Act claim on the disparity between

her pay and DeYoung's pay. NGM argues that it is entitled to

11 summary judgment on the claim both because Peck has not offered

enough evidence to support her claim that the compared jobs

involve substantially egual work, and because the undisputed

facts establish that the pay differential was due to factors

other than sex. Reviewing the evidence in the light most

favorable to Peck, I find that neither argument entitles NGM to

the relief it seeks. First, while Peck's evidence that the

compared jobs involve substantially the same skill, duties,

supervision, effort, and responsibility is far from compelling,

it is not so weak that it falls below the "more than a scintilla"

standard that this circuit employs when reviewing summary

judgment claims against the party with the burden of proof. See

Milton,

. Second, I agree with Peck that the

facts material to NGM's claim that the differential is based on

factors other than sex remain sufficiently murky so as to

preclude summary judgment on that basis. Thus, I deny

defendants' motion for summary judgment on the Egual Pay Act

claim.7

7 NGM remains free to renew its summary judgment arguments in a motion for judgment as a matter of law at the conclusion of the plaintiff's case. See Fed. R. Civ. P. 50.

12 C. The Fair Labor Standards Act Claim

Peck claims that she is entitled to relief under the Fair

Labor Standards Act ("FLSA") because she was required to work

uncompensated overtime. The FLSA provides in pertinent part that

no employer shall employ an employee for more than forty hours

per week unless the employee receives compensation for the

overtime at a rate of one and one half times their regular rate.

(a). To prove that an employer has violated the

FLSA, an employee must show that: (1) she actually worked

overtime; (2) the amount and extent of overtime was shown by

justifiable and reasonable inference; and (3) the defendant had

knowledge, actual or constructive, of her work. Davis v. Food

Lion,

(4th Cir. 1986) . NGM argues that

summary judgment should be granted because Peck cannot meet her

burden on any of these elements.

1. Whether Peck actually worked the overtime

An employee is entitled to overtime pay under the FLSA only

if she actually worked the overtime and not if she merely was

waiting to be engaged in work.8 Kelly v. Hines-Rinaldi Funeral

At oral argument. Peck agreed that the time necessary to fill out her reports would amount only to twenty to thirty hours per week. Therefore, as counsel agreed at oral argument, in

13 Home, Inc.,

(4th Cir. 1988) (no overtime for

waiting time), cert. denied,

(1989). "Work" means

"physical or mental exertion (whether burdensome or not)

controlled or required by the employer and pursued necessarily

and primarily for the benefit of the employer ... ." Tennessee

Coal, Iron & R. Co. v. Muscoda Local No. 123,

(1944). Waiting or down time may be work because " [r]efraining

from other activity often is a factor of instant readiness to

serve ..." an employer. Armour & Co. v. Wantock,

(1944). Therefore, whether an employee is actually working

or is merely waiting to be engaged in work depends upon whether

the time in question is spent for the employer's rather than the

employee's benefit. Id.; accord Martin v. Ohio Turnpike Comm'n,

(6th Cir. 1992) (per curiam), cert. denied, 113

S. C t . 979 (1993); Shamblin v. City of Colchester,

(C.D. 111. 1992);

. If an employee

could not utilize her spare time effectively for normal pursuits,

then the time is compensable and is not waiting time.

. This does not mean, however, that an employee's

order for Peck to show she actually worked the overtime, she must demonstrate that she was engaged to wait, not merely waiting, during the time she was not completing forms or performing the other tasks.

14 flexibility during waiting time must be identical to that during

non-waiting time because to allow such a rule would enable nearly

all waiting time to be compensable. Owens v. Local No. 169,

, 350-51 (guoting Brown v. Houston N.W. Medical Ctr.

Survivor, Inc.,

(5th Cir. 1991) (en banc),

cert. denied,

(1992)), modified,

(9th Cir. 1992). There is no bright line test;

rather the determination is a guestion of degree, taking into

account all the circumstances. Armour,

; accord

Skidmore v. Swift & Co.,

(1944); Berry v.

County of Sonoma,

(9th Cir. 1994) (predominant

factors are agreement between parties and freedom to engage in

personal activities), cert. denied, 115 S. C t . 1100 (1995);

Owens,

(same); Birdwell v. City of Gadsen,

(11th Cir. 1992) (same plus practical agreement of

parties by conduct and relation of nature of services to waiting

time).

Peck contends that she could not leave her house from 6 a.m.

until 8 p.m. because she was reguired to be available to

underwriters and agents during regular business hours as well as

to insureds who may need to return her calls either before or

after regular business hours. Further, she alleges that she was

15 required to remain in her home in order to keep her "no hit"

ratio below one percent, a fact she was commended for by NGM.

Drawing all reasonable inferences in her favor and accepting her

testimony as true. Peck was unable to leave her home during

periods of inactivity, which is an indication that she was

engaged to wait rather than merely waiting to be engaged. See

Lurvev v. Metropolitan Dade Ctv. ,

(S.D.

Fla. 1994);

Peck also received rush requests quite often, at least once,

but sometimes three to four times per week. Her ability to

respond quickly to these requests was cited as a strength on her

evaluations. The frequency of these requests and NGM's

requirement that she respond to the rush requests immediately

restricted her ability to utilize the waiting time for her own

pursuits. Compare Kelly,

(three calls per month

not frequent enough to be unduly restrictive on employee's time)

with Renfro v. City of Emporia,

(10th Cir.

1991) (four to five calls per day unduly restricted fire fighters

waiting time), cert. dismissed,

(1992).

In addition, because Peck was the only person doing

telephone inspections on a regular basis, these responsibilities

could not easily be shifted or traded to other employees at NGM.

16 See Miner v. B & C Equip., Inc., No. 93-35401,

(9th Cir. May 18, 1994) (even though plaintiff did not often

trade, because he could have traded on call time easily, he was

not entitled to overtime compensation); Kelly,

(plaintiff not entitled to overtime where phone would be answered

by others if plaintiff did not respond). But see Bright,

(employee not entitled to overtime where only on-call

employee and required to respond to all calls because could go

anywhere while on-call with pager). In fact. Peck attempted to

have DeYoung do several telephone inspections to aid her in

dealing with her backlog, but most of these inspections were

returned to Peck incomplete.

Finally, Peck states that she did not engage in any personal

activities from 6 a.m. through 8 p.m. Instead, she claims that

she did all her grocery shopping, cleaning, eating, sleeping and

socializing on the weekends and after 8 p.m. during the week,

except for occasionally loading the dishwasher. She also stated

that if the phone rang while she was eating she would interrupt

her meal to answer the call. A reasonable jury, based on all of

the surrounding circumstances, could find that Peck's waiting

time was primarily for NGM's benefit. See, e.g., Kelly,

(employee effectively used waiting time because slept); 29

(not off duty if required to perform duties while

eating). Thus, Peck has offered sufficient evidence that she

actually worked overtime to overcome NGM's summary judgment

motion on this issue.

2. Whether the amount of overtime was shown by justifiable and reasonable inference

NGM argues that, based on plaintiff's production level and

the nature of her additional tasks, there is no reasonable basis

to infer that her job required any overtime. They point to

DeYoung's June 1993 report which indicated that the bulk of

Peck's calling occurred in the morning and in the late afternoon

leaving large gaps in her day unaccounted for. Absent a showing

that she was continuously working during this time, the

defendants contend that there is no basis for drawing the

reasonable inference that she actually worked the overtime.

In evaluations, however. Peck was lauded for her flexibility

in reaching insureds at off times and for maintaining a no hit

ratio of less than one percent. At the time of these

evaluations, the evaluator knew the Peck was concerned about the

amount of hours she spent working. Further, Peck informed NGM

staff that she was available to insured parties from 6:00 a.m.

until 8:00 p.m. and management confirmed this availability.

18 Finally, Peck's backlog and the managing of that backlog were of

great concern to NGM. Therefore, a reasonable jury could find

that Peck's proof demonstrates through justifiable and reasonable

inference that she worked uncompensated overtime. See Pforr v.

Food Lion, Inc.,

(4th Cir. 1988) (need only

show amount of uncompensated overtime by just and reasonable

inference) .

3. Whether NGM had actual or constructive knowledge that Peck was working the overtime

An employee must also demonstrate that her employer had

actual or constructive knowledge of the overtime. Newton v. City

of Henderson,

(5th Cir. 1995); Davis,

6 (where employer suffer or permits the overtime, it acts

with knowledge of the overtime) (citing

(g)).

In meeting this reguirement, an employee need not make a

contemporaneous reguest for overtime so long as the employee

establishes that the employer knows and permits the employee to

work the overtime. Forrester v. Roth's IGA Foodliner, Inc., 64

(9th Cir. 1981). Alternatively, even if the

employer has knowledge of the overtime, the employer may be

relieved of liability if it repeatedly instructs the employee not

to work the overtime. See Lindow v. United States,

1057, 1062 n.3 (9th Cir. 1984). Nevertheless, "[t]he mere

promulgation of a rule against such work is not enough.

Management has the power to enforce the rule and must make every

effort to do so."

.

Peck contends that NGM had actual knowledge of her overtime

because she told several supervisors and managers, including

Aldrich, Buchholz, and DeYoung, that she was working all day and

felt burnt out from the hours and her inability to leave her

home. In a memo to his files, Buchholz acknowledged that Peck

had made these comments. Both Mary Graves and Deborah Hannon,

Peck's former supervisors, also acknowledged that Peck had made

the comments. Drawing all reasonable inferences in Peck's favor,

a reasonable jury could find that NGM had knowledge of her

overtime hours.

Furthermore, Peck denies that anyone at NGM instructed her

not to work those hours, although NGM contends that several

individuals instructed her to only work a split shift. In

addition, despite some recommendations as to how to more

effectively organize her day, no one at NGM implemented or

enforced these recommendations. Thus, there are genuine issues

of material fact as to whether NGM promulgated a rule prohibiting

Peck from working the overtime and whether, even if they did, it

20 was enforced. Therefore, I deny NGM's motion for summary

judgment with respect to this claim. See Fed. R. Civ. P. 56.

D. The Wrongful Discharge Claim

To prevail on a claim for wrongful discharge, an employee

must prove that the employer (1) terminated the employment (2)

out of bad faith, malice or retaliation and (3) because the

employee performed acts which public policy would encourage or

because the employee refused to perform acts prohibited by public

policy. Short v. School Admin, Unit No. 16,

,

(1992). NGM argues that it is entitled to summary

judgment on Peck's wrongful discharge claim because Peck has not

established that NGM acted with malice directed at her and

because the acts Peck claims are encouraged by public policy

amount to nothing more than the guestioning of managerial policy.

1. Bad faith

Bad faith is the eguivalent of malice in the context of a

wrongful discharge claim. Centronics Corp. v. Genicom Corp.,

,

(1989); accord MacDonald v.

Tandy Corp.,

(D.N.H. 1992) (bad faith where

company knew that termination was unreasonable and still decided

to terminate employee), aff'd ,

(1st Cir. 1993);

Godfrey v. Perkin-Elmer Corp.,

, 1187 n.7

21 (D.N.H. 1992) (company's failure to investigate employee's sexual

harassment complaint or remedy discriminatory practices

sufficient evidence of bad faith). Specifically, the manner in

which an at will employee is discharged may support a conclusion

that the employer was motivated by bad faith or malice. Cloutier

v. Great Atl. & Pac. Tea Co.,

,

(1981) (employee of 36 years suspended after five minute

meeting and terminated in cursory manner supported conclusion

employer acted in bad faith). Peck worked for NGM for nearly

twenty years and received excellent evaluations. Despite many

years of good service. Peck was terminated after two short phone

calls with her supervisor regarding an issue that had already

been resolved the previous month. Further, Buchholz refused to

acknowledge her dispute with DeYoung's story despite learning she

had called human resources to dispute that she had resigned.

Under these circumstances. Peck has offered sufficient evidence

to survive a motion for summary judgment claiming the sufficiency

of her proof of bad faith.

2. Public Policy

"'Unless an employee at will identifies a specific

expression of public policy, he [or she] may be discharged with

or without cause.'"

,

(citations

22 omitted). Although a specific public policy must be identified,

the expression of that policy need not be found in a statute nor

must it be "so strongly stated that its existence would be

established ... as a matter of law." Bourque v. Town of Bow,

(D.N.H. 1990) (citing Cloutier,

). Nevertheless, "an employee's expression of

disagreement with a management decision is not an act protected

by public policy." Short,

,

(business reasons exception to prohibition against retaliatory

discharge in violation of public policy); accord Miesowicz v.

Essex Group, Inc., Civil No. 91-667-JD, slip op. at 4 (D.N.H.

Apr. 12, 1994) (termination for disagreement with management

policy not actionable even if discharge is harsh or unfair).

Whether a public policy exists is usually a guestion for the jury

unless the absence of a policy is so clear that the court can

rule as a matter of law. Short,

,

;

Cloutier,

,

(existence of public

policy reguires multifaceted balancing test properly left to

jury's determination).

Peck cites two acts that public policy would encourage: (1)

guestioning her status with NGM after becoming suspicious that

NGM was attempting to fire her; and (2) attempting to obtain

23 relief from her overtime obligations. Whether either of these

alleged public policies are sufficient to support her wrongful

termination claim involves a guestion of fact that must be left

to the jury to resolve. Therefore, I deny defendant's motion for

summary judgment on this claim. See Fed. R. Civ. P. 56(c) .

E. The Intentional Interference with Contractual Relations Claim

Peck claims that the individual defendants intentionally

interfered with her employment relationship with NGM. In order

to prove intentional interference with contractual relations, the

plaintiff must show: (1) the existence of an economic

relationship with a third party; (2) the defendant knew of that

relationship; (3) the defendant intentionally and improperly

interfered with this relationship; and (4) the plaintiff was

damaged by such interference. Soltani v. Smith,

(D.N.H. 1993). Whether an employer can be deemed a

third party where the defendants are employees of the employer,

depends upon whether the individual defendants acted within the

scope of their employment. See

at 12 97; see also Alexander

v. Fujitsu Business Communication Svs., Inc.,

(D.N.H. 1993); Gram v. Liberty Mutual Ins. Co.,

,

(1981) (freedom to effect corporate

24 purpose should not be curtailed by fear of individual liability).

" [A]n individual [is] not acting within the scope of his

employment if his decision 'was motivated by actual malice',

where 'actual malice' is defined as 'bad faith, personal ill-

will, spite, hostility, or a deliberate intent to harm the

plaintiff.'" Soltani,

(emphasis omitted);

see also Daigle v. City of Portsmouth,

,

(1987) (act performed in furtherance of business is

within scope of employment).

Defendants argue that plaintiff's claim must fail because

the individual defendants were acting within the scope of their

employment, and therefore, NGM cannot be considered a third

party.9 In response. Peck contends that whether the individual

defendants were acting within the scope of their employment is a

factual determination for the jury.

9 Defendants also argue that this claim is deficient because plaintiff inconsistently contends in her respondeat superior count (Count VII) that the individual defendants were acting within the scope of their employment. I agree with plaintiff with respect to this portion of the defendants' argument. The statements in Count VII with respect to vicarious liability, although inconsistent with this count, are permissible under Fed. R.Civ. P. 8 (e) (2) .

25 1. DeYoung

Peck asserts that DeYoung acted in bad faith in fabricating

the story about her resignation in order to avoid his

responsibilities as her supervisor. In support of her claim.

Peck offers evidence that DeYoung's evaluations and raises

suffered because of his failure to properly undertake his

supervisory responsibilities and that he demonstrated an

unwillingness to either supervise or communicate with Peck. She

argues that a reasonable jury could infer from this evidence that

DeYoung acted with spite or hostility towards Peck in relaying

the false story that she had guit. I agree. Thus, DeYoung is

not entitled to summary judgment with respect to this claim.

2. Buchholz and Schwartz

Peck has failed to identify any evidence to support her

claim that Buchholz and Schwartz acted beyond the scope of their

employment. Thus, both defendants are entitled to summary

judgment with respect to these claims.

F. Other Claims

1. Negligent Supervision

Peck argues that NGM and Buchholz negligently failed to

supervise NGM's employees in such a way as to prevent them from

(1) unreasonably terminating other employees; (2) discriminating

26 against other employees; and (3) causing other employees to work

excessive hours without compensation. Although the New Hampshire

Supreme Court has recognized a tort of negligent supervision in

limited circumstances, see Cutter v. Town of Farmington,

(1985), plaintiff concedes that the court has never extended

the tort in the manner plaintiff suggests. Moreover, several

other jurisdictions have rejected efforts to expand the tort to

cover claims such as those that plaintiff seeks to raise. See,

e.g., Pulson v. Davis,

, 710 (10th Cir. 1990); Maxev

v. M.H.M., Inc.,

(D. Md. 1993); Chesapeake

& Potomac Tel. Co. v. Dowdy,

(Va. 1988); .

In the face of this conflicting precedent, I decline to recognize

a right of action that has not yet been authorized by the New

Hampshire Supreme Court. See Putnam Resources v. Pateman,

(1st Cir. 1992); Public Serv. Co. v. Hudson Light &

Power Dept.,

, 346 (1st Cir. 1991) . Accordingly, I

grant defendants' summary judgment motion with respect to this

claim.

2. Respondeat Superior/Vicarious Liability

In Count VII, Peck asserts that NGM is liable for the

actions of the individual employees based on the theory of

respondeat superior. Trahan-Laroche, slip op. at 3 (citations

27 omitted). Plaintiff's remaining claims do not assert that the

individual defendants engaged in any actionable conduct for which

NGM can be vicariously liable.10 Therefore, resort to theories

of indirect liability to recover from NGM are inapposite. Thus,

I grant defendants' motion for summary judgment with respect to

this claim.

III. CONCLUSION

For the foregoing reasons I grant in part (Counts IV

(against Buchholz and Schwartz), VI, and VII), and deny in part

(Counts I, II, III, IV (against DeYoung) defendants' Motion for

Summary Judgment (document no. 18).

SO ORDERED.

Paul Barbadoro United States District Judge June 21, 1995 cc: Gordon Rehnborg Joseph Hoppock

10 While Peck's claim against DeYoung for intentional interference with contractual relations survives, the basis for that claim is that DeYoung acted outside the scope of his employment. Therefore, even if respondeat superior liability were applicable in this case, it is not a basis to hold an employer liable if the employee acts outside the scope of his or her employment.

28