Free Brief - District Court of Colorado - Colorado

Case 1:03-cv-02073-WDM-KLM

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLORADO Civil Action No.03-WM-2073 (PAC) ROBERTA PULSE, TONYA HOUSE, Plaintiffs, v. THE LARRY H. MILLER GROUP, Defendant.

SUBMISSION REGARDING THE STATUS OF DEFENDANT THE LARRY H. MILLER GROUP AS AN "EMPLOYER" UNDER TITLE VII

Based on this Court's request at the December 22, 2005 Final Trial Preparation Conference, Defendant submits this brief as to whether The Larry H. Miller Group is an "employer" for purposes of Title VII. Defendant did not employ 15 or more employees for each working day in each of 20 or more calendar weeks in the same calendar year or the year prior to when discrimination is alleged to have occurred. See 42 U.S.C. § 2000e(b). Therefore, this case should be dismissed. ARGUMENT A. This Court Lacks Subject Matter Jurisdiction Over Defendant The Larry H. Miller Group To establish their Title VII claims, Plaintiffs must prove, inter alia, that the sole remaining Defendant, The Larry H. Miller Group, is an "employer" for purposes of Title VII. A party is an "employer" under Title VII if it had 15 or more employees for

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each working day in each of 20 or more calendar weeks in the same calendar year or the year prior to when discrimination is alleged to have occurred. 42 U.S.C. §2000e(b); see also, Blagg v. The Tech. Group, Inc., et al., 303 F.Supp.2d 1181, 1187 (D. Colo. 2004, Miller, J.) (finding lack of subject matter jurisdiction in Title VII action because defendant did not employ 15 or more persons). In this case, the following facts are undisputed: · The Larry H. Miller Group has never been issued a Certificate of Good Standing or an Entity ID number by the State of Colorado. (Defendant's Motion to Dismiss or, in the alternative, for Motion Summary Judgment ("Motion") at ¶12 1; Plaintiffs' Response to Motion to Dismiss/Summary Judgment ("Response") at ¶12). The Larry H. Miller Group is not a holding company, does not transact business of any type, has not been issued a business name, trademark, or trade name by the State of Colorado. (Motion at ¶¶13-14; Response at ¶¶13-14). The Larry H. Miller Group has never applied to or received from the IRS an Employer Identification Number and has never hired employees. (Motion at ¶17; Response at ¶17). The Larry H. Miller Group has never issued W-2 Statements to the Plaintiffs or to anyone else, and Plaintiffs have never filled out W-4 forms listing their employer as "The Larry H. Miller Group." (Motion ¶18; Response at ¶18). The Larry Miller Corporation--Denver, hired Tonya House and on June 1, 1999, she herself filled out a W-4 form listing her employer as "Larry Miller Toyota". (Motion at ¶23; Response at ¶23, and Ex. 18). The Larry H. Miller Group has never been required to file, and has never filed a Federal or State income tax return, nor is it required to. (Motion at ¶19; Response at ¶19). Plaintiffs have admitted that The Larry H. Miller Corporation--Denver was Plaintiffs' true employer. (Motion at ¶8; Response at ¶¶1-10).

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All references to the paragraphs of the respective briefs are to the Statement of Undisputed Facts set forth by Defendant and to the corresponding response to it by Plaintiffs.

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Against this fusillade of undisputed facts, Plaintiffs have offered no evidence of a single person, much less 15 persons, being employed by Defendant The Larry H. Miller Group for any number of weeks at any time; no evidence that The Larry H. Miller Group actively operated or engaged in any business; and no evidence that The Larry H. Miller Group even had agents through which to engage in any activity whatsoever. 1. Capacity to be Sued Does Not Confer Subject Matter Jurisdiction Over The Larry H. Miller Group as an "Employer"

This Court ruled that The Larry H. Miller Group has capacity to be sued. See Order on Recommendation of Magistrate Judge, Sept. 20, 2005 (Doc. 132) at p. 4 ("Under both the federal and Colorado versions of Rule 17(b), LHM Group has the capacity to be sued in this case."). Rule 17(b), C OLO . R. C IV . P. provides, in part: "A partnership or other unincorporated association may sue or be sued in its common name for the purpose of enforcing for or against it a substantive right." (emphasis added) Similarly, Rule 17(b), F ED . R. C IV . P. provides, in part: The capacity of a corporation to sue or be sued shall be determined by the law under which it was organized. In all other cases, capacity to sue or be sued shall be determined by the law of the state in which the district court is held, except (1) that a partnership or other unincorporated association, which has no capacity by the law of such state, may sue or be sued in its common name for the purpose of enforcing for or against it a substantive right existing under the Constitution or laws of the United States...(emphasis added) This Court did not specifically identify which procedural rule applied, but determined under either rule, The Larry H. Miller Group has capacity to be sued. More importantly, the Court left open the question whether The Larry H. Miller Group was an

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"employer" under Title VII. Thus, any argument by Plaintiffs that the Court's Order on Recommendation of Magistrate constituted a finding that the Larry H. Miller Group was an "employer" is patently false. A procedural rule that allows a "common name" to be sued is not probative of and does not establish that the "common name" is an "employer" under Title VII. 2. Neither the Facts Nor Plaintiffs' Alternative Theories Supports a Finding that The Larry H. Miller Group is an "Employer"

Although the Court granted Plaintiffs leave to add "The Larry H. Miller Corporation -- Denver" as a defendant in this civil action, Plaintiffs voluntarily chose not to file or serve a summons or Amended Complaint to assert any claims against that entity. 2 They did so with the knowledge that The Larry H. Miller Corporation--Denver was their "employer." (Motion at ¶8; Response at ¶¶1-10). Later, Plaintiffs sought to add two additional defendants, Larry H. Miller Management Co. ("LHM Management Co.") and The Larry H. Miller Group of Companies ("LHM Group of Companies"). The Magistrate-Judge denied Plaintiffs' Motions based upon, inter alia, the determination that Plaintiffs had knowledge at the time they filed their EEOC charge that Tony Schnurr, senior vice president for Larry Miller Management Co. participated in the decision to terminate Plaintiff Pulse, that Plaintiffs knew that the "LHM Group of Companies," to the extent it was a legal entity capable of being sued, was a potential defendant because it was identified in the Employee Handbook. Plaintiffs did not appeal the Magistrate-Judge's recommendation.
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Instead, Plaintiffs merely added The Larry H. Miller Corporation -- Denver as a Defendant in the caption of the pleadings, without the due process of serving a summons and complaint.

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This Court affirmed that ruling. See Order on Recommendation of Magistrate Judge, Sept. 20, 2005 (Doc. 132) at p. 5. In addition to its refusal to allow the inclusion of LHM Management Co. and LHM Group of Companies, this Court, in its Order on Recommendation of Magistrate Judge granted Defendant's request to dismiss The Larry H. Miller Corporation-- Denver: Because Plaintiffs did not serve LHM Corp. with summons and an amended pleading, this court is not authorized to assert jurisdiction over LHM Corp. . . . The motion to dismiss LHM Corp. for lack of personal jurisdiction will be granted. See Order on Recommendation of Magistrate Judge, Sept. 20, 2005 (Doc. 132) at p. 3. Despite their failure to properly assert claims against their true employer, Plaintiffs have asserted a smorgasbord of liability theories--identity of interest, integrated and/or joint employer, alter ego, agency, and economic realities--although these theories were not specifically pled in the Complaint. Before Plaintiffs can assert any theory that would result in the imposition of liability on another entity, however, that entity must be named in the Complaint and served with appropriate process. See e.g. · Sandoval v. City of Boulder, Colorado, 388 F.3d 1312, 1317 and 1322-24 (10th Cir. 2004). Plaintiff named the City of Boulder, Colorado and the Boulder Regional Communications Center and alleged that the two entities were an integrated enterprise or single-employer. Bristol v. Bd. of Co. Comm'r of Co. of Clear Creek, 312 F.3d 1213, 1216 (10th Cir. 2002). Plaintiff named both the Clear Creek County Board of County Commissioners and the Clear Creek Sheriff in this official capacity and alleged joint employer liability.

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Lowell Staats Min. Co. v. Pioneer Uravan, Inc., 878 F.2d 1259, 1261-62 (10th Cir. 1989). Plaintiff named each corporation to which it sought to pierce the corporate veil under the alter ego theory. Friedman & Sons, Inc. v. Safeway Stores, Inc., 712 P.2d 1128, 1129 and 1131 (Colo. App. 1985). Safeway and its alleged alter ego both named as defendants. LaFond v. Basham, 683 P.2d 367, 368-70 (Colo. App. 1984). Plaintiff named Colorado Builders of Englewood, Inc., and individuals alleged to be alter egos of corporation. Reader v. Detrina and Assoc. Marketing, Inc., 693 P.2d 398, 399 (Colo. App. 1984). Plaintiff named as defendants both a corporation and sole shareholder alleged to be its alter ego. Ward v. Cooper, 685 P.2d 1382, 1382-83 (Colo. App. 1984). Plaintiff named as defendants both corporation and the president of corporation who was alleged to be the corporation's alter ego. Blagg, 303 F.Supp.2d 1181, (D. Colo. 2004)(Miller, J.). The Technology Group, Inc. ("TTGI") and Millennium Technologies Consulting, Inc. ("MTCI") were parties to the suit. Blagg alleged that TTGI and MTCI were integrated enterprises.

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As this Court has held with regard to non-party Larry H. Miller Corporation--Denver, service of summons is the threshold issue for personal jurisdiction: the act which empowers the trial court to exercise jurisdiction over the defendant. See Order on Recommendation of Magistrate Judge, Sept. 20, 2005 (Doc. 132) at pp. 2-3, citing Omni Capital Int'l, Ltd. v. Rudolf Wolff & Co., Ltd., 484 U.S. 97, 104 (1987). Here, Plaintiffs have not named LHM Management Co. and LHM Group of Companies or served them with process, and the Court has no personal jurisdiction over them. Permitting Plaintiffs to assert claims against them now is inconsistent with Due Process. Further, to permit Plaintiffs to assert theories of liability against non-parties The Larry H. Miller Group of Companies and Larry H. Miller Management Company in an attempt to prove

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that either has an identity of interest with Defendant, is integrated or a joint employer of Defendant, or alter ego of Defendant is equally inconsistent with Due Process. These theories beg the question of whether personal jurisdiction exists over each of those nonparties. It does not. The failure to establish personal jurisdiction over those nonparties dooms Plaintiffs' claims under these theories also. CONCLUSION Plaintiffs are unable to meet the threshold jurisdictional requirement necessary to empower this Court to hear the claims in this case. Here, there is no evidence that Defendant The Larry H. Miller Group ever employed any person, for any length of time. Accordingly, the Court should dismiss Plaintiffs' Title VII claims and this action with prejudice.

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DATED: December 28, 2005. /s/ Steven M. Gutierrez Steven M. Gutierrez, H OLLAND & H ART LLP 555 Seventeenth St., Suite 3200 Denver, CO 80202 Telephone: 303-295-8000 Fax: 303-295-8261 E-mail: [email protected] Christopher M. Leh H OLLAND & H ART LLP 1800 Broadway, Suite 300 Boulder, CO 80302 Telephone: 303-473-2700 Fax: 303-473-2720 E-mail: [email protected] Judith H. Holmes J UDITH H OLMES & A SSOCIATES , LLC 7887 E. Belleview Suite 1100 Englewood, CO 80111 Telephone: 303-228-2267 Facsimile: 303-781-6877 Email: [email protected] ATTORNEYS FOR DEFENDANT

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CERTIFICATE OF SERVICE

I hereby certify that on December ___, 2005, I electronically filed the foregoing with the Clerk of Court using the CM/ECF system that will send notification of such filing to the following e-mail addresses: Kimberlie K. Ryan, [email protected] Judy Holmes, [email protected] Whitney Traylor, [email protected]

s/Steven M. Gutierrez

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