Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-88-02478/USCOURTS-ca10-88-02478-0/pdf.json

Nature of Suit Code: 790
Nature of Suit: Other Labor Litigation
Cause of Action: 

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FI LED 

United Stares Court of Appeals 

Tenth Cirruit 

SEP 2 8 1989 

IN THE UNITED STATES COURT OF APPEALS 

ROBERT L. HOECKER 

FOR THE TENTH CIRCUIT Clerk 

DANIEL N. LILLY, ) 

) 

Plaintiff/Appellant, ) 

) 

V • ) 

) 

DELTA DISTRIBUTORS, INC., ) 

formerly known as Delta ) 

Solvents & Chemicals Company, ) 

) 

Defendant/Appellee. ) 

No. 88-2478 

(W.D. Oklahoma) 

(D.C. No. CIV-88-89-R) 

ORDER AND JUDGMENT* 

Before MOORE, ANDERSON, and BRORBY, Circuit Judges. 

After examining the briefs and appellate record, this panel 

has determined unanimously that oral argument would not materially 

assist the determination of this appeal. See Fed. R. App. P. 

34(a); 10th Cir. R. 34.1.9. 

submitted without oral argument. 

The cause is therefore ordered 

Appellant, Daniel N. Lilly, became a sales representative for 

Delta Distributors, Inc. on May 1, 1985, at the age of 57. As a 

salaried representative Lilly's salary was $30,000 per year, plus 

a commission on the gross profit from his sales. The relationship 

* This order and judgment has no precedential value and shall 

not be cited, or used by any court within the Tenth Circuit, 

except for purposes of establishing the doctrines of the law of 

the case, res judicata, or collateral estoppel. 10th Cir. R. 

36.3. 

Appellate Case: 88-2478 Document: 01019974029 Date Filed: 09/28/1989 Page: 1 
' 

between Lilly and Delta was troubled in many respects almost from 

the outset. In his brief, Lilly outlines his contacts with Delta 

in June, July, August, and November of that year, expressing 

dissatisfaction with respect to a lack of confirmation of the 

terms of his employment, the amount of gross sales with which he 

was being credited, Delta's alleged failure to pay commissions in 

timely and adequate amounts, and an alleged later misstatement by 

Delta of the terms of his employment. There is no dispute that on 

January 22, 1986 Lilly was called to a meeting with representatives of Delta in Oklahoma City. There is also no dispute that 

following that meeting Lilly's relationship with Delta was 

substantially altered. Lilly concedes in his brief that after 

February 1, 1986 he ceased to receive any salary, his company car 

was taken away, and he ceased receiving any other benefits 

attendant to his position as an employee. Brief of Appellant at 

8, 16. Delta regarded Lilly's position as an employee as having 

terminated at that time, with Lilly continuing solely as an 

independent commissioned sales agent. 

Lilly continued to remain in a sales representative capacity 

for more than a year and a half, although friction and grounds for 

dissatisfaction continued at a high level between him and Delta. 

Delta employees began calling directly on Lilly's customers and in 

late August 1987, Lilly observed advertisements placed by Delta in 

a local newspaper seeking a chemical sales person. Thereafter, on 

September 11, 1987, Lilly filed a complaint with the Equal Employment Opportunity Commission ("EEOC") accusing Delta of discriminating against him on the basis of age. The content of Lilly's 

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affidavit in connection with the complaint is important to the 

issue of the timeliness of that complaint. Lilly's sworn statement includes the following: 

"Specifically, in Jan. 1986, Robert Nicka, Division 

Mgr (about 46 years old) told me that the company could 

not afford to keep two men as sales reps in the State of 

Oklahoma. By that time I had generated over $600,000 in 

increases [sic] sales for the company, and that projects 

out to over $1 million annually. Nicka also said that 

he 'wanted a younger man' to work in Tulsa. 

Mr. Nicka offered to put me on a Commission basis 

doing sales for the company, but he also wanted me to 

sell [illegible] their permission. I basically 

considered the removal from my salaried sales position 

to a commission sales position as a termination from the 

company. I had been getting paid $30,000.00/year plus 

5% Commission on gross profits, but Nicka wanted me to 

be off the company's salaried payroll and working for 

the company stricty [sic] in a commission position. In 

effect, I have not been an employee of the company since 

January 1986. 

I have been working for the company as a sales rep 

since then. I have gotten orders for the company on 

which I have earned commissions." 

R. Vol. II, tab 48, Def. Ex. B, p.l. On January 21, 1988 Lilly 

commenced this action in the district court. In his complaint 

Lilly alleged that Delta demoted, terminated, and failed to rehire 

him because of his age, in violation of the Age Discrimination in 

Employment Act 29 u.s.c. § 621, et. ~ ("ADEA"), and further 

alleged a variety of other unlawful acts by Delta in relation to 

the termination of Lilly's employment. Lilly was allowed to amend 

his complaint once, but the district court refused to permit a 

second amendment and subsequently entered summary judgment in 

Delta's favor on the causes of actions which are the subject of 

this appeal. The court also dismissed a portion of the complaint 

from which no appeal has been taken. 

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On appeal Lilly presents four issues. First, Lilly contends 

that the district court abused its discretion in denying Lilly 

leave to file a second amendment to his complaint. Second, Lilly 

contends that the district court erred when it determined that 

Lilly's charge with the EEOC was untimely on the ground that "it 

is undisputed that at least by February 19, 1986, plaintiff knew 

that he had been terminated as a salaried employee of Delta and 

demoted to a commission position." R. Vol. I, tab 68 at 11. 

Lilly contends that there is a fact issue in this regard, and that 

Delta engaged in a series of acts, constituting a continuing 

violation, from June 1985 through 1987. Brief of Appellant at 17. 

Third, Lilly contends that Delta's personnel handbook constituted 

a unilateral contract although he never did see or rely upon the 

personnel manual in question during his employment with Delta. He 

argues that the district court erred in granting summary judgment 

against him on that count on the ground that reliance on a 

personnel handbook is required. And, fourth, Lilly contends that 

the district court erred in granting Delta summary judgment on 

Lilly's charge that Delta's conduct breached an implied covenant 

of good faith and fair dealing. We review the grant of summary 

judgment by the district court under the principles set out in 

Celotex Corp. v. Catrett, 477 U.S. 317 (1986); and Anderson v. 

Liberty Lobby, Inc., 477 U.S. 242 (1986). 

With respect to the first issue, we have stated many times 

that a district court has broad discretion in determining whether 

or not to permit amendments to a complaint, and we will not 

disturb the exercise of that discretion unless the records shows 

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. ' 

it has been abused. See Federal Ins. Co. v. Gates Learjet Corp., 

823 F.2d 383 (10th Cir. 1987); First City Bank v. Air Capitol 

Aircraft Sales, Inc., 820 F.2d 1127, 1133 (10th Cir. 1987). We 

have reviewed the record in this case and determine that the 

district court did not abuse its discretion. 

Lilly's second contention on appeal, relating to the 

timeliness of his complaint to the EEOC, was analyzed by the 

district court in detail. We reject Lilly's continuing violation 

theory, and substantially adopt the reasoning and conclusion of 

the district court. A copy of the district court's opinion is 

attached and incorporated herein for that purpose. 

The remaining two issues raised by Lilly on appeal are 

largely controlled by our opinion in Williams v. Maremont Corp., 

875 F.2d 1476 (10th Cir. 1989), and the decision of the Oklahoma 

Supreme Court in Burk v. K-Mart Corp., 770 P.2d 24 (Okla. 1989). 

In Maremont we held that under Oklahoma law no contract was 

created under the circumstances of that case by an employee manual 

which the employee never saw or relied upon. That holding is 

consistent with that of the district court in this case. Lilly 

concedes that he had no knowledge of and did not rely upon Delta's 

handbook. Brief of Appellant at 19-20. Under the circumstances 

the Delta handbook did not create a contract with Lilly. 

In Burk the Oklahoma Supreme Court held that "there is no 

implied obligation of good faith and fair dealing in reference to 

termination in any employment at will contract." Burk v. K-Mark 

Corp., 770 P.2d at 29. The record supports the district court's 

conclusion that Lilly's relationship with Delta was "at will." 

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The district court indulged Lilly's alternative argument that 

there was a breach of an implied obligation arising from an agency 

relationship similar to the insurance agent situation in Hall v. 

Farmers Ins. Exchange, 713 P.2d 1027 (Okla. 1986), and found no 

genuine issue in Lilly's favor on that point as well. The court 

noted the critical distinction that Lilly was not deprived of 

commissions arising in the future as fruits of past labor. We 

agree with and adopt the district court's reasoning and holding on 

that issue. 

In summary, we have carefully reviewed the record in this 

case and all of the arguments and the authorities cited to us by 

Lilly, and c9nclude that the district court was correct. The 

judgment of the district court is, therefore, AFFIRMED. The 

mandate shall issue forthwith. 

ENTERED FOR THE COURT 

Stephen H. Anderson 

Circuit Judge 

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V 

• 

IN TBE UNITED STATES DISTRICT COURT FOR THE 

WESTERN ·DISTRICT OF OKLAHOMA 

DANIEL N. LILLY, ) 

) 

Plaintiff, ) 

) 

-vs- ) 

) 

DELTA DISTRIBUTORS, INC. , ) 

formerly known as DELTA ) 

SOLVENTS & CHEMICALS co., ) 

) 

Defendant. ) 

0 R D E R 

D0£KETED 

FILED 

AUG 2 2 88 

Before the Court are two motions filed by 

Defendant Delta .Distributors, Inc., formerly known as Delta 

Solvents & Chemicals Company ( "Delta 11 ) • The first is a 

motion to dismiss Counts S and 6 of Plaintiff• s Amended 

Complaint and that portion of Count 4 of the Amended 

Complaint which seeks damages for humiliation, embarrassment 

and loss of reputation, for failure to state claims on which 

relief can be granted. In that motion, Delta also seeks its 

costs and attorneys• fees incurred in bringing the motion, 

apparently pursuant to F.R.Civ. P. 11, although Delta does 

not state the basis for this aspect of its motion. The 

second motion is for summary judgment on the Amended 

Complaint. In support of this motion, which was filed 

approximately two weeks after the motion to dismiss was 

filed, Delta adopts the arguments in support of its motion 

to dismiss and requests that the Court either ciismiss or 

grant swnmary judgment on those claims which are the subject 

of the motion to dismiss. 

I (t 

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( 2 ( 

• 

On the basis of the pleadings, the Court cannot 

say that Plaintiff can prove no facts entitling him to 

relief under Count 5. The Court cannot ascertain from the 

face of the Amended Complaint that Plaintiff cannot bring _ 

himself within the rule of Hall v. Farmer Insurance 

E:tchange, 713 P.2d 1027 (Okla. 1986), "that an agent may 

recover from the principal when the latter has, in bad 

faith, deprived him of the fruit of his own labor." Hinson 

v. Cameron, 742 P.2d 549, 552 (Okla. 1987) (footnote 

omitted). As Plaintiff points out, it does not app~ar on 

the face of his pleading that he is an at-will employee, 

i.e., that he does not have an employment contract 

specifying the duration of his employment. Although it 

appears that Plaintiff ' is invoking the theory of an 

implied-in-fact contract limitation on at-will employment 

status in Count 4, since a plaintiff may plead inconsistent 

theories, the Court cannot say that Plaintiff can prove no 

set of facts entitling him to relief on Count 5. 

Count 6 of the Amended Complaint must be 

dismissed. Plaintiff contends that a willful violation of 

the Age Discrimination in Employment Act (ADEA), 29 u.s.c. 

S 621 !! seg., in reckless disregard of Plaintiff's rights 

and interest would entitle him to liquidated damages which 

are punitive in nature. The Court agrees that such damages 

are punitive in nature. ~ Trans World Airlines, Inc. v. 

Thurston, 469 u.s. lll, 125-26, 10s s.ct. 013, _, 83 

L,Ed,2d 523-536 (1985). However, Plaintiff alleges in Count 

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( 3 

• 

l the willful violation of the ADEA, ~ Amended Complaint 

at 1 (11), prays for liquidated damages, see Amended 

Complaint, Prayer at 'iI (3), and specifically invokes this 

court's pendent jurisdiction for Count 6. See Amended - Complaint at 1 (27). Accordingly, Count 6 either does not 

relate to the ADEA claim at all, or to the extent it does, 

is redundant. Plaintiff concedes that violations of the 

Oklahoma civil rights act as it relates to discrimination in 

employment, Okla. Stat. tit. 25, S 1301 !! !!S• (Count 3) do 

not afford a basis for recovery of punitive damages. 

Response Brief at 6. Plaintiff argues that certain contract 

breaches can and do amount to tortious conduct and if 

accompanied by malice, fraud or oppression, could justify 

punitive damages, citing· Storck v. Cities Service Gas Co., 

634 P.2d 1319, 1323 (Okla. App. 1981). While this is true, 

Plaintiff has pleaded no facts showing or from which it 

could be inferred that the alleged breach of contract 

resulted in some independent wrong separate from and in 

addition to the breach of contract. See z.o. Howard Co. v. 

Cartwright, 537 P.2d 345, 347 (Okla. 1975)7 Burton v. 

Juzwik, 524 P.2d 16 (Okla. 1974); Hall Jones Oil Corp. v. 

Claro, 459 P.2d 858, 861-63 (Okla. 1969); Woods Petroleum 

Corp. v. Delhi Gas Pipeline Corp,, 700 P.2d 1023, 1027 

(Okla. App. 1983) • .§.!!~Norman's Heritage Real Estate 

Co. v. Aetna Casualty & Surety Co., 727 F.2d 911, 914 & 916 

(10th Cir. 1984)1 _§_paeth v. Union Oil Company of California, 

710 Jr,2d 1455, 1459-60 (10th Cir. 1983); Order, Rainbow 

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Travel Service, Inc. v. Hilton Hotels Corp., CIV-86-2525-R 

(W.D. Okla. Nov. 30, 1987). Order, Bartel v. Texas Oil & 

Gas Corp., CIV-86-2789-R (W.D. Okla. Feb. 20, 1987). The 

only other basis for recovery of punitive damages for "acts" 

and "breaches" alleged to be "wanton, oppressive and in 

reckless disregard of Plaintiff's rights and interest in his 

employment with Defendant," Amended Complaint at 1 (29), to 

which Plaintiff points is Defendant's alleged breach of the 

covenant of good faith. Assuming that Plaintiff could, as 

noted above, bring himself within the rule of Hall v. 

Farmers Insurance Exchange as explained in Hinson v. 

Cameron, punitive damages are not authorized under that 

rule. After Hinson a duty of good faith, "if it exists at 

all, must be derived from the intentions of the parties to 

their agreement and thus, a breach of this duty more 

appropriately constitutes a breach of implied contract." 

Order, Emrick v. Verex Corp., CIV-87-1225-W (W.D. Okla. Nov. 

30, 1987) at p. s. As the Court in Hinson noted, even those 

jurisdictions which recognize an implied-in-law covenant of 

good faith in all employment contracts ground a cause of 

action for breach of that covenant on contract, not on tort. 

742 P.2d 554 n. 12. Moreover, assuming that a covenant of 

good faith may ·exist in an employment contract for a term of 

years, or more doubtfully, in an implied-in-fact contract 

created by an employer's personnel manual, the breach 

thereof does not amount to an independent, wil!ful tort for 

which punitive damages are recoverable, absent allegations 

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5 

• 

of a separate tort such as slander or conversion, see above. 

Accord, Order, Emrick v. Verex Corp1⁄4., CIV-87-1225-W,· at p. 

5. Accordingly, Defendant Delta's motion to dismiss Count 6 

of Plaintiff's Amended Complaint must be granted. An 

additional reason that Count 6 must be dismissed is that a 

claim for punitive damages does not constitute a separate 

and independent cause of action under Oklahoma law but is 

only incidental to a claim for actual damages. Gilbreath v, 

Phillips Petrolewn co., 526 F. Supp. 657, 659 (W,D, Okla. 

1980), cited in Norman's Heritage Real Estate v. Aetna 

£_asualty & Surety co., 727 F.2d at 915. 

Count 4 of Plaintiff's Amended complaint, for 

breach of contract, must also be dismissed to the extent 

that it seeks damages for embarrassment, loss of reputation 

and humiliation not connected with any physical injury, See 

- Seidenbach's Inc. v. Williams, 361 P.2d 185, 187-88 (Okla, 

1961). Even in tort actions for infliction of emotional 

distress, Oklahoma courts have required that a plaintiff 

allege tangible, organic physical damage connected with his 

or her mental distress in order to recover for the latter. 

~ Richardson v. J. C, Penney Co,, Inc., 649 P.2d 565, 

566-67 (Okla. App. 1982) and cases cited therein. Plaintiff 

has not alleged any physical injury connected with the 

humiliation or mental distress he alleges was caused by 

Defendant's conduct. Thus, Plaintiff cannot recover 

therefor even if the breach of contract amounted to the 

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6 

independent tort of negligent infliction of emotional 

distress. Id. 

The Court cannot say that Counts 6 and 4 were not 

warranted by existing law or a good faith argument for the 

extension or modification of existing law or that those 

claims were interposed for an improper purpose. F.R.Civ. P. 

11. count 6 may be viewed as merely incidental to and 

redundant to Count 1. Plaintiff's counsel may have merely 

inadvertently failed to allege physical injury connected 

with Plaintiff's mental distress in Count 4. Defendant's 

motion for attorneys fees and costs incurred in bringing its 

motion to dismiss is denied, 

In its motion ·for summary judgment, Del ta asserts 

that the uncontroverted facts establish that 1) Plaintiff's 

claims under the ADEA (Counts 1 and 2) are barred because 

Plaintiff failed to timely file a charge of discrimination 

with the EEOC1 2) Defendant is additionally entitled to 

summary judgment on Plaintiff's ADEA claim for a pattern and 

practice of age discrimination against employees (Count 2) 

because Plaintiff has no competent evidence of same; 3) 

Plaintiff's claim under the Oklahoma civil rights act 

prohibiting discrimination in employment, Okla, Stat. tit. 

25, S 130 ~ !!S• (Count 3) is barred because the Plaintiff 

did not file a charge of discrimination with the Oklahoma 

Human Rights Commission and is not, in any event, legally 

cognizable because the Oklahoma act does not · authorize a 

private cause of action; and 4} Plaintiff did not rely on 

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7 

• 

Defendant's personnel manual and the manual does not 

delineate all grounds for termination, by reason of which no 

implied in fact contract (Count 4) between Plaintiff and 

Defendant can have arisen. Additionally, Delta reurges its 

arguments in support of its motion to dismiss as basis for 

its asserted entitlement to summary judgment on Counts 4 and 

s. 

It is undisputed that Plaintiff filed his charge 

of discrimination with the EEOC and the Oklahoma Human 

Rights Commission on September 11, 1987. Delta additionally 

asserts that the undisputed facts show that Plaintiff's 

demotion and termination occurred January 31, 1986 when the 

decision was made, or, at the latest, in February 1986, when 

Plaintiff knew he was no longer a salaried employee of 

Delta, citing Plaintiff's EEOC affidavit and his deposition 

testimony, Exhibits "C" and "E" to Defendant's Brief. Thus, 

according to Del ta, Plaintiff's claim under the ADEA for 

discriminatory demotion and termination (but not for not 

rehiring) 1 is barred by either the 180-day or 300 day 

limitation periods set forth in 29 U.S.C. S 626(d), citing 

Delaware State College v. Ricks, 449 u.s. 250, 101 s.ct. 

498, 66 L.Ed.2d 431 (1980). 

Plaintiff seeks to avoid the bar of the statutory 

time limitation by invoking the continuing violation theory, 

1. Defendant has not moved for summary judgment on 

Plaintiff I s ADEA claim in Count 1 for failure to rehire 

Plaintiff. 

Appellate Case: 88-2478 Document: 01019974029 Date Filed: 09/28/1989 Page: 13 
( 8 

relying on Bruno v. Western Electric Co., 829 F.2d 957, 960 

(10th Cir. 1987) and ·valentino v. United States 0 Postal 

service, 674 F.2d 56, 65 (D.C. Cir. 1982). It is difficult 

to ascertain what facts Plaintiff is relying on to support 

his continuing violation theory. He points to conduct 

beginning in June of 1985 when Delta purportedly attempted 

to increase his gross profit goal, extending to December of 

1985 with Delta's refusal to pay commissions and then 

states: 

There can be no question that Lilly 

timely filed his complaint after Del ta 

advertised in the Daily Oklahoman for a 

chemical salesperson. The.date of March 

15, 1987 would have been under 180 days 

preceding September 11, 1987 and 

November 15, 1986 would have been 300 

days preceding Lilly's filing of the 

complaint with· the EEOC. Paul Herman, 

the 26 year old salesperson with one 

year of experience was hired in November 

or December of 1986. He went into the 

field after a one month training 

program. Thereafter, he called on 

certain of Lilly's accounts. In 

addition, on December 19, 1986 Lilly 

wrote Nicka confirming a telephone 

conversation and again requesting 

commissions due for the preceding 

months. In January or early February of 

1987 Nicka and Lilly discussed Lilly's 

commissions and Lilly confirmed this by 

letter of February 2, 1987. 

The foregoing facts reveal that 

Delta implemented its plan to eliminate 

Lilly and hire a younger salesman in 

November of 1986 and the impact was felt 

thereafter when he began calling on 

Lilly's accounts, As the undisputed 

documented facts indicate, as late as 

December of 1986 Lilly was still having 

extreme difficulty getting his 

commission checks on any sort of a 

timely basis, This was a problem that 

existed since August of 1985. 

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9 ( 

The foregoing represents 

without question a series of related 

acts, one or more of which falls within 

either limitations period. Bruno, 

supra; Valentino v. United States Postal 

Serv., 674 F,2d 56, 65 (D,C, Cir. 1982). 

Plaintiff's Brief at pp. 

12-13. 

The Court has searched all three of the statements 

of facts in Plaintiff's Brief and all of the evidence 

submitted by both Plaintiff and Defendant and cannot 

ascertain the significance of the date "March 15, 1987" in 

the statement quoted above. The evidence submitted by 

Plaintiff does show that Delta ran an ad for a salesperson 

in !h!, Dail~ Oklahoman on August 30, 1987. See Exhibit "R" 

to Plaintiff's Brief and Deposition of Daniel N. Lilly, 

Exhibit "A" to Plaintiff's Brief, at p. 357. Plaintiff has 

submitted 2 other undated ads by Delta in ~ Dail__y 

Oklahoman, one for a salesperson in an unspecified area and 

one for a salesperson in the Dallas/Ft. Worth area. See 

Exhibit ttR" to Plaintiff's Brief. Plaintiff testified that 

when he called Mr. Nicka in the Tulsa office in response to 

one of the ads, Nicka told him "We don't have a sales 

position open. We didn't run any ad." Lilly Deposition at 

p. 357. Plaintiff also sent a letter and his resume to 

Delta, responding to the ad in the August 30, 1987 paper, 

g. at p. 374, but Plaintiff never received a reply. ~. at 

3S8. The evidence submitted by Plaintiff further shows that 

Paul Herman was hired in November of 1986 as a·salesman for 

Delta to work out of the Tulsa office and handle the 

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\ 10 

., 

"eastern part of the territory, including the Tulsa 

metropolitan area," Deposition of Robert Nicka, Exhibit "Q" 

to Plaintiff's Brief, at pp. _ (illegible). Herman was 

under the age of forty when he was hired. Id, Herman 

"called on" some of Plaintiff's customers, although he was 

told by Mr. Nicka, division manager for Delta, that those 

accounts were the Plaintiff's. Id. Herman was not 

con$idered by Mr. Nicka, who hired Herman, to be a 

replacement for the Plaintiff; rather, he was an addition to 

the Tulsa sales staff for the expansion of the Tulsa 

district." g. at 369-70. Mr. Nicka further testified that 

Delta's changing of the Plaintiff's compensation or status 

with Delta in January of 1986 had nothing to do with its 

intention to hire Paul Herman, 19.. at 372. There is also 

evidence that in approximately September of 1986, Delta 

hired Al June as a commissioned salesman for Delta in 

Oklahoma City. Lilly Deposition at p. 350, Plaintiff 

objected to Nicka, saying that it was highly irregular to 

expect two commissioned sales people to work the same market 

area and not "crisscross" and cause confusion to customers 

as to who was representing Del ta, Id, at 351. Nicka's 

response was that by keeping records, he would see that 

having two salesmen worked and that Mr. June wouldn't 

interrupt or call on Plaintiff's customers. Id. at 351. In 

spite of this, June did call on several of Plaintiff• s 

customers, according to Plaintiff, ,!i!, at 352.· 

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11 

• 

Viewing the foregoing in a light most favorable to 

the Plaintiff, as the Court must, Plaintiff has failed to 

sustain its burden of proving a series of related 

d!scriminatory acts, one or more of which falls in the 

limitation period. Plaintiff is correct that Oklahom~ is a 

"deferral state," see Okla. Stat. tit. 25, S 1302; Okla, 

Stat. tit. 25, § 1502(a), such that the 300-day period of 29 

u.s.c. S 626(d) (2) applies. Indeed, Defendant concedes that 

the 300-day period applies to Plaintiff's ADEA claim, See 

Defendant's Reply Brief at p. 2. It is undisputed that at 

least by February of 1986, Plaintiff knew that he had been 

terminated as a salaried employee of Delta and demoted to a 

commission position. See Lilly Oeposi tion, Exhibit .. E" to 

Defendant's Brief, at pp. 281-82, 386-88 & 396; Exhibit "C" 

to Defendant's Brief. Moreover, it is undisputed that the 

Plaintiff knew at least by that time that he was being 

terminated or demoted because of his age. Plaintiff 

testified that in a meeting in January of 1986 Mr. Nicka 

told him that Delta wanted to hire a younger man to work in 

Tulsa. See Lilly Deposition at p. 3877 Exhibit "C". Based 

on these undisputed facts, Delta is entitled to summary 

judgment on Plaintiff's ADEA claim not based on a pattern or 

practice of discrimination because the discriminatory acts 

of termination and demotion occurred more than 300 days 

before Plaintiff filed his EEOC charge, unless Plaintiff has 

submitted evidence from which a jury could find·a continuing 

violation. 

Appellate Case: 88-2478 Document: 01019974029 Date Filed: 09/28/1989 Page: 17 
12 

• 

The "continuing violation" theory requires a 

showing that a violation of the ADEA, and not just the 

effects of the violation, extended into the statutory 

period. Bruno v. Western Electric Co., 829 F.2d 957, 960 

(10th Cir. 1987). 

"To establish a continuing violation [a 

plaintiff] would have to show 'a series 

of related acts, one or more of which 

falls within the limitations period, or 

the maintenance of a discriminatory 

system both before and during the 

[limitations period.'" Valentino v. 

United States Postal Serv., 674 F.2d 56, 

65 (D.C. Cir. 1982) (emphasis 

added) (quoting B Schler & P. Grossman, 

Employment Discrimination Law 232 (Supp. 

1979)). The continuing violation can be 

either a company-wide policy of 

discrimination or a series of related 

acts taken against a single individual. 

Bruno v. Western Electric 

~, 829 F.2d at 961. 

Since Plaintiff has alleged a pattern and practice of 

discrimination as a separate ADEA count (Count II), which 

the Court addresses separately below, the Court will first 

confine its inquiry to whether Plaintiff has submitted 

evidence of a series of related discriminatory acts against 

Plaintiff, o~ly, to determine whether Defendant is entitled 

to summary judgment on Count I. 

Initially, the Court notes that completed acts 

such as terminations are not considered to be of a 

continuing nature. §.!!_ Welty v. s.F. & G., Inc., 605 F. 

Supp. 1548, 1559-60 (N.O. Ala. 1985) (ADEA and Title VII, 

S 706 (<l), as amended, 42 u.s.c. S 2000e-5 (e)); Quillen v. 

U.S. Postal Service, 564 F. Supp. 314, 319-20 (E. D. Mich. 

Appellate Case: 88-2478 Document: 01019974029 Date Filed: 09/28/1989 Page: 18 
l 13 

.. 1983) (Title VlI, § 717, as amended 42 u.s.c. § 2000e-l6). 

But assuming that a continuing violation might nevertheless 

be found, Plaintiff's evidence of the hiring of a younger 

man, Paul Herman, in the Tulsa office, was merely a 

consequence or effect of the alleged discriminatory act -

the termination and demotion of Plaintiff - and not itself a 

discriminatory act. see Delaware State College v. Ricks, 

4 4 9 U. S • 2 5 O , 2 5 8 , 1 O 1 S • Ct. 4 9 8 , , 6 6 L. Ed • 4 31 , 4 4 0 

(1980). And there is no evidence that Paul Herman did not 

call on customers of other Delta sales representatives and 

thus compete with them. §.!! id,, 449 U.S. at 258, 101 

s.ct. at _, 66 L. Ed. 2d at 439 (no evidence that Ricks' 

termination, an effect of denial of tenure, "differed 

discriminatorily" from the manner in which other non-tenured 

professors were terminated) • Similarly, there is no 

evidence that Al June did not compete with younger 

commissioned salesmen for Delta or that Delta knew that June 

was competing with Plaintiff nor is there any evidence that 

Delta was not late in paying younger salespersons' 

commissions. With respect to Delta's failure to hire 

Plaintiff in the early fall of 1987, there is no evidence 

that the position for which Delta was advertising was one 

for the Oklahoma territory as opposed to, for example the 

Dallas/Ft. Worth area, in which Plaintiff was not interested 

in working, or more importantly, that Delta hired a younger 

person for the position, which would be necessary to show 

that the failure to hire Plaintiff was a discriminatory act, 

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(, 14 

• 

absent direct evidence of discrimination. Finally, this is 

not a case where Plaintiff has alleged that the acts of 

Defendant were part of a plan to get rid of Plaintiff 

altogether. Compare with Bruno v. Western Electric Co., 829 

F, 2d at 961. Accordingly, Plain ti£ f's evidence fails to 

show a related discriminatory act taken against him within 

the limitation period and there is no evidence from which 

reasonable jurors could find a continuing ADEA violation 

against Plaintiff, Defendant's motion for summary judgment 

as to Count 1 of the Amended Complaint must, therefore, be 

granted. 

In Count 2, Plaintiff alleges a patte~n and 

practice of age discrimination against employees within the 

protected class: 

Defendants [sic] have, by the use 

of facially neutral employment practices 

and on other occasions, by the use of 

excessively subjective standards for the 

selection of those to be demoted, 

dismissed, or denied reinstatement, 

caused a significant, adverse and 

discriminatory impact upon persons over 

the age of forty. Plaintiff is one of 

the victims of the aforesaid practices. 

Amended Complaint at 1 14. 

When a claim of age discrimination is based on a 

continuing pr~ctice of discrimination, as is Count 2 of 

Plaintiff's Amended Complaint, a plaintiff may rely upon a 

discriminatory act di~ected at another individual to 

establish that the pattern or practice continued to within 

the limitations period for filing a discrimination charge. 

See Furr v. AT&T Technologies, Inc~, 824 F.2d 1537, 1544-45 

Appellate Case: 88-2478 Document: 01019974029 Date Filed: 09/28/1989 Page: 20 
15 

• 

(10th Cir. 1987). Thus, as to this claim, Plaintiff's 

evidence of the termination of Ms. Shardell Abernathy -may be 

considered to determine whether a discriminatory pattern and 

practice continued to within the statutory charge-filing 

period. However, the evidence concerning the asserted 

termination of Ms. Abernathy is insufficient to establish a 

discriminatory act or application of a "facially neutral 

practice" or "subjective standard" for the demotion or 

dismissal of persons over the age of forty. Compare with 

furr v. AT&T Technolo3ies, Ine., 824 F.2d at 1543, 

Plaintiff testified that Ms, Abernathy, an office manager, 

had been fired by Delta and that she told him that she had 

filed a claim with the Oklahoma Human Rights Commission and 

had initiated litigation ·for violations of the wage and hour 

law. Lilly Deposition at p. 390. He testified that her 

termination "would have had to have been in the fall of '87 

sometime" and both that "[s]he was in her forties" and that 

"he didn't know her age." Id, Plaintiff has wholly failed 

to point to or submit any evidence of a facially neutral 

employment practice or a subjective standard of demotion or 

termination of persons over the age of forty or submit any 

evidence showing that application of such facially neutral 

or subjective standards was the reason for Ms. Abernathy's 

termination. Indeed, the record is completely silent on 

what Delta's asserted reason for terminating Ms. Abernathy 

was. Even if, viewing the evidence in a· light most 

favorable to Plaintiff, the Court infers therefrom that the 

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16 

facially neutral practice to which Plaintiff refers is the 

reduction of expenses in the Tulsa office, ~ Plaintiff's 

Brief, "Statement of Material Facts as to which a Genuine 

Issue Exists," 1 3 and Lilly Deposition at pp. 143-49, 

Plaintiff has offered no evidence that application of this 

"reduction in force" practice was the purported basis for 

Ms. Abernathy's termination. 

Even if Plaintiff's Amended Complaint could be 

read to allege a pattern and practice of intentional age 

discrimination - of terminating older employees by reason of 

their age, i.e. a pattern or practice of disparate 

treatment, which is doubtful, again the Court finds that 

Plaintiff has failed to submit evidence from which a jury 

could find a discrimina·tory act within the charge-filing 

period, which is necessary to show that the pattern or 

practice continued until that time. See Furr v. AT&T - Technologies, Inc., 824 F.2d at 1544. ~ ~ Bruno v. 

Western Electric Co., 829 F.2d at 960-61. Plaintiff has 

offered no direct. evidence that Mrs. Abernathy was 

terminated because of her age. And Plaintiff has failed to 

submit any evidence of two of the elements necessary to 

establish indirectly, through the McDonnell Douglas prirna 

facie case,

2 that the employment decision to terminate Ms. 

Abernathy was a discriminatory act within the charge-filing 

period. There is no evidence that she was qualified to 

2. See McDonnell Douglas Corp. v. Green, 411 u.s. 792, 802, 

93 t:ic!.2d l8l7,' _, j7 L,Ed.2d 668, 677 (1973). 

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17 

perform the work she was doing or that she was replaced by 

someone younger. Compare with Furr v. AT&T Technologies, 

.!n.S_, 8 24 F. 2d at 1542 ( four part test for failure to 

promote). 

The Plaintiff having failed to submit direct or 

indirect evidence from which a jury could find a 

discriminatory act or application of a "facially neutral 

practice" or "subjective standard" for demotion or dismissal 

within the charge-filing period, Defendant is entitled to 

summary judgment on Plaintiff's pattern-or-practice AOEA 

claim, Count II, because the EEOC charge was untimely. 

Moreover, Plaintiff's statistical evidence, though relevant 

to his pattern-or--practice claim, ~ McAlester v. United 

Air Lines, Inc,, Nos, 86-1088 & 86-1130, slip op. at pp. 

15•20 (10th Cir. July 14, 1988), would not assist the 

Plaintiff in establishing a requisite discriminatory 

incident within the 300-day limitations period. 

It is unnecessary for the Court to determine 

whether the Oklahoma civil rights act, Okla. Stat, tit, 25, 

S 1101 _!! !!_g,, specifically Sections 1301 through 1311 and 

Section 1502, provides a private cause of action for 

discrimination in employment on the basis of age because 

even if such a private cause of action is provided therein, 

Plaintiff's age discrimination claims brought thereunder 

(Count 3) are untimely. The express purpose of the Oklahoma 

civil rights act is "to provide for execution within the 

state of the policies embodied in . • • the federal Age 

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18 

• 

Discrimination in Employment Act of 1967 II Okla. 

Stat. tit. 25, § llOl(a). Thus, assuming the creation or 

implication of a state-law based private right of action, 

courts should interpret the statute in a manner consistent 

with the ADEA and case law developed under the ADEA is 

persuasive. Thus assuming, without deciding, that the 

continuing violation and pattern and practice theories would 

be viable under the Oklahoma act, Plaintiff's state law 

claims for age discrimination are time barred for the same 

reason that his federal law claims are barred: he has 

failed to submit evidence from which a jury could find a 

discriminatory act or incident of application of a facially 

neutral practice having a disparate impact within the 

charge-filing or complaint-filing period, which in this 

instance is within one hundred eighty (180) days of the 

filing of the complaint. 

S 1502 (a). 

§!! Okla, Stat. tit. 25, 

The undisputed evidence herein establishes that 

Plaintiff never saw Defendant's personnel manual during his 

employment with Delta. Lilly Deposition at p. 380, 385-386, 

He did not see the handbook until May of 1988, 4 months 

after he filed this lawsuit. Id. at p. 385-86. 

Accordingly, Plaintiff could not, as a matter of logic and 

law, have relied on the personnel manual. Plaintiff doesn't 

dispute this conclusion, but argues that Defendant's 

interpretation of language in Langdon v. Saga Cor2_., 569 

P.2d 524 (Okla. App. 1976) is unreasonable and impractical 

Appellate Case: 88-2478 Document: 01019974029 Date Filed: 09/28/1989 Page: 24 
l 19 ( . 

in that it requires that a party to a unilateral contract 

rely on every term to thereafter have recourse for breach. 

Further, Plaintiff observes that in Wagenseller v. 

Scottsdale Memorial Hospital, 710 P.2d 1025 (Ariz. · 1985), 

one of the cases cited in Hinson in connection with another 

issue, the Court expressly rejected reliance as a sine gua 

non of a contractual modification of an at-will employment 

agreement. 710 P.2d at 1038. Plaintiff also maintains that 

Delta's interpretation of Langdon improperly ignores the 

distinction between a personnel manual as a unilateral offer 

to contract and the non-contractual theory of promissory 

estoppel. 

The Oklahoma Supreme Court neither expressly 

adopted nor expressly rejected the implied-in-fact contract 

limitation on the employment-at-will doctrine in Hinson. 

However, this Court has projected that the Oklahoma Supreme 

Court would, if confronted directly with the issue, adopt 

the implied contract exception to the at-will doctrine. See 

- above. Moreover, based on the Oklahoma Supreme Court's 

tacit or partial approval of Langdon in Hinson v. Cameron, 

!!!. 742 P.2d at 552, the Court is of the opinion that the 

Oklahoma Supreme Court, like the Oklahoma Court of Appeals 

in Langdo~, will require reliance on a personnel handbook in 

order for the handbook to constitute an offer for a 

unilateral contract and thus the basis for an implied in 

fact contract. Nor does the Court agree that· Defendant's 

interpretation of Lang4on would require an offeree/employee 

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---· ---- ,. __ _ 

l 20 ( 

.. to rely on each and every term of a personnel manual, but in 

the context of this case, that is a non-issue since . it is 

clear here that Plaintiff could not have relied on any of 

the terms of the manual, including those he now maintains 

limited Delta's right to terminate him, because he neve~ saw 

the manual while employed at Delta. Furthermore, utilizing 

a different analytical construct, knowledge of an offer of a 

handbook to modify an at-will relationship is legally 

necessary to Plaintiff's acceptance thereof so as to give 

rise to an implied in fact contract. See Okla. Stat. tit. 

15, S 2; Okla. Stat. tit. 15, S 66; Texas Co. v. Forson, 196 

Okla. 599, 167 P. 2d 877, 880 (1946) (mutual assent required 

in implied in fact contract) . The "offerlf of the handbook 

for a unilateral contract must have been communicated to 

Plaintiff for Plaintiff's continuing employment and 

foregoing his option of termination to constitute acceptance 

of that offer, ~ Langdon v. Saga Core., 569 P.2d at 527. 

As noted above, Defendant has reurged argument 

made in support of its motion to dismiss Count 5 of the 

Amended Complaint as grounds for its motion for summary 

judgment on Count 5. Plaintiff has made no responsive 

arguments, but the Court will examine the evidence submitted 

by Plaintiff to ascertain whether there is evidence from 

which reasonable jurors could find either that Plaintiff had 

an employment contract in which the duration of his 

employment was specified 2!. that Plaintiff was'an agent of 

Defendant and that hia principal, Delta, deprived him of 

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l. 21 

• 

earned income or commissions. ~ Hinson v. Cameron, 742 

P.2d at 552. There is no evidence of an employment contract 

specifying duration of employment. Indeed, Plaintiff 

disclaims that any employment agreement existed after 

January of 1986 and there is no evidence of an agreement 

concerning employment. While Plaintiff disputes that he was 

an agent for Delta, ~ Plaintiff's Brief at p. 5 and 

"Statement of Material Facts as to Which ·a Genuine Issues 

[sic] Exists" at i 5, there is evidence in the record from 

which a jury could find that after January of 1986, 

Plaintiff was an agent for Delta, but there is no evidence 

that Plaintiff has been deprived of c,ommissions or other 

"fruits of his labor" by some act of Del ta. Compare ~ 

Hall v. Farmers Insurance Exchange, 713 P.2d 1027, as 

explained and limited in Hinson v. Cameron, 742 P.2d at 552. 

There is evidence that Delta was late in paying Plaintiff's 

commissions in 1985 and 1986, but there is no evidence that 

Plaintiff is owed and has been deprived by Delta of 

commissions earned. Defendant is therefore entitled to 

summary judgment on Count 5 of Plaintiffi;s' Amended 

Complaint. 

In accordance with the foregoing, Defendant's 

motion to dismiss Count 5 is denied; its motion to dismiss 

Count 6 is granted; and its motion to dismiss that portion 

of Count 4 

embarrassment 

which 

and 

seeks 

loss of 

damages for humiliation, 

reputation .ts granted • 

Defendant's motion for attorneys' fees and costs is denied, 

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--.~----·~ 'r I 'fl!lllltM ""' • ....-.11!111!"!"--..._:.-~_.,._.!!"~~~-~-:""'.-. __ ~,--~· :::.'.'"'"• -=:-:-:---

l 22 

• 

Defendant's motion for summary judgment on the remaining 

counts of Plaintiff's Amended Complaint, Counts l through 5, 

except Count 1 as it pertains to Defendant's alleged failure 

to rehire Plaintiff (on which Defendant did not move for 

summary judgment) is granted. 

IT IS 50 ORDERED this ~day of August, 1988. 

~Lfluvut2 

UNITED STATES DISTRICT JUDGE 

ENTERED tN JUDGEMENT DOCKET ON cz .. -<~ ./f 

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