Court Opinion

ID: 73805
Source: CourtListenerOpinion
Date Created: 2010-04-26 08:23:33+00
Date Added: 2024-06-11T09:39:24.632845
License: Public Domain

[PUBLISH]

                      IN THE UNITED STATES COURT OF APPEALS

                              FOR THE ELEVENTH CIRCUIT

                                 ________________________

                                        No. 97-8483
                                 ________________________

                              D. C. Docket No. 96-CV-1584-JOF

ROBERT E. MCANDREW,

                                                                  Plaintiff-Counter-
                                                                  Defendant-Appellant,

                                            versus

LOCKHEED MARTIN CORPORATION,
Successor in Interest to LOCKHEED-AERONAUTICAL
SYSTEMS COMPANY, a division of LOCKHEED
CORPORATION, et al.,
                                                                  Defendant-Counter-
                                                                  Claimant-Appellee,

J. A. BLACKWELL, JR., T. A. GRAHAM, et al.,

                                                                  Defendants-Appellees.

                                 ________________________

                         Appeal from the United States District Court
                            for the Northern District of Georgia
                              _________________________

                                        (June 18, 1999)

Before BARKETT, Circuit Judge, GODBOLD and GOODWIN*, Senior Circuit Judges.
GODBOLD, Senior Circuit Judge:

       *
         Honorable Alfred T. Goodwin, U.S. Senior Circuit Judge for the Ninth Circuit, sitting
by designation.
      Plaintiff alleges that his employer Lockheed Martin Corporation and various

of its officers conspired: (1) to deter him from testifying before a federal grand jury

investigating the sale of aircraft by Lockheed to Egypt and (2) to fire him in

retaliation for having testified. He sued under 42 U.S.C. § 1985(2), 42 U.S.C. §

1986, the United States and Georgia constitutions, and Georgia intentional

infliction of emotional distress common law. Lockheed filed counterclaims

asserting that plaintiff breached his fiduciary duties to Lockheed and committed

fraud in connection with the sale at issue in the investigation.

      The district court dismissed: (1) plaintiff’s § 1985 claim because the

intracorporate conspiracy doctrine destroyed plaintiff’s allegation of conspiracy;

(2) his § 1986 claim because it is derivative of the § 1985 claim and because the

one-year statute of limitations had run; (3) his constitutional claims because he

failed to allege state action; and (4) his intentional infliction of emotional distress

claim because the statute of limitations had run. The court entered a Rule 54(b)

certificate pursuant to which the counterclaims remain pending in the district court.

      Plaintiff’s appeal questions the court’s ruling on the § 1985 claim and the

intentional infliction of emotional distress claim. He does not appeal the dismissal

of his § 1986 claim or his constitutional claims. We reverse the district court on

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the § 1985 claim and affirm the decision on the intentional infliction of emotional

distress claim.

                                  I. Section 1985 Claim

       The intracorporate conspiracy doctrine holds that acts of corporate agents

are attributed to the corporation itself, which negates the multiplicity of actors

necessary for a conspiracy. Defendants contend plaintiff cannot show a

conspiracy under 42 U.S.C. § 1985(2) because the doctrine applies in the civil

rights context. The district court accepted defendants’ argument and dismissed the

§ 1985 claim for failure to allege an actionable conspiracy. The court relied upon

Nelson Radio & Supply Co. v. Motorola Inc., 200 F.2d 911, 914 (5th Cir. 1952), an

anti-trust case which appears to have been first to apply the intracorporate

conspiracy doctrine.

       The circuits are split as to whether the intracorporate conspiracy doctrine

should be applied outside the antitrust field. Some circuits have extended the

doctrine to apply in all types of civil actions including civil rights actions alleging

a conspiracy under § 1985.1 See Benningfield v. City of Houston, 157 F.3d 369,

       1
         However, most of these circuits have recognized an exception to the intracorporate
conspiracy doctrine where the employees of a corporation are alleged to have acted for their own
personal benefit. E.g., Johnson v. Hills & Dales Gen. Hosp., 40 F.3d 837, 839 (6th Cir. 1994).
The “personal stake” exception does not apply in this case because plaintiff alleged defendants

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378 (5th Cir. 1998), cert. denied, 119 S. Ct. 1457 (1999); Hartman v. Board of

Trustees, 4 F.3d 465, 469-70 (7th Cir. 1993); Hull v. Cuyahoga Valley Bd. of

Educ., 926 F.2d 505, 509 (6th Cir. 1991); Buschi v. Kirven, 775 F.2d 1240, 1252

(4th Cir. 1985); Cross v. General Motors Corp., 721 F.2d 1152, 1156 (8th Cir.

1983); Herrmann v. Moore, 576 F.2d 453, 459 (2nd Cir. 1978). Other circuits have

held that the doctrine does not extend to civil rights conspiracies under § 1985.

See Brever v. Rockwell Int’l Corp., 40 F.3d 1119, 1127 (10th Cir. 1994); Stathos v.

Bowden, 728 F.2d 15, 20-21 (1st Cir. 1984) (Breyer, J.); Novothy v. Great Am.

Fed. Sav. & Loan Ass’n, 584 F.2d 1235, 1256-59 (3rd Cir. 1978), vacated on other

grounds, 442 U.S. 366 (1979); see also Saville v. Houston Co. Healthcare Auth.,

852 F. Supp. 1512, 1539 (M.D. Ala. 1994).

       The Supreme Court has recognized the conflict between the circuits but

declined to resolve it. See Copperweld Corp. v. Independence Tube Corp., 467

U.S. 752, 775 n.24 (1984); Novothy, 442 U.S. at 372, n.11 (1979). However, the

Court has decided conspiracy cases against members of a single corporation

without applying the intracorporate conspiracy doctrine, which appears to indicate

it does not consider the doctrine an absolute. See U.S. v. Wise, 370 U.S. 405

(1962) (corporate officer subjected to prosecution under section one of the

were acting within the course and scope of their employment. Complaint ¶ 9.

                                              4
Sherman Act where indictment alleged conspiracy between officer and

corporation; no explanation why intracorporate conspiracy doctrine did not apply).

      Although the Eleventh Circuit has joined the majority of circuits in holding

that the intracorporate conspiracy doctrine does not apply to criminal conspiracies,

see U.S. v. Hartley, 678 F.2d 961, 970-72 (11th Cir. 1982), we have not ruled on

whether it applies in civil rights actions. We now align ourselves with the First,

Third and Tenth Circuits and decline to extend the doctrine to the civil rights area.

      The fiction of corporation personification originated to broaden the scope of

corporate responsibility by making corporations accountable for the acts of their

agents. See Hartley, 678 F.2d at 970-72 (refusing to apply intracorporate

conspiracy doctrine to criminal conspiracy and noting with approval that courts

have refused to apply doctrine in § 1985 context). The intracorporate conspiracy

doctrine’s shield of corporate responsibility derives from the special nature of

antitrust law. See Copperweld, 467 U.S. at 769; Stathos, 728 F.2d at 20-21;

Nelson, 200 F.2d at 914. Section one of the Sherman Act is aimed at preventing

entities that previously had been pursuing diverging goals from uniting their

economic power by, for example, fixing a price. An internal agreement to

implement a single corporation’s policies does not suddenly bring together

diverging economic power and so does not raise the antitrust dangers that section

                                          5
one was designed to police. Rather, joint internal decision-making is socially

useful and often necessary. By contrast, where civil rights are at issue

discrimination by an individual business is no less harmful than discrimination by

multiple businesses nor does internal discrimination confer any benefit on society.

See Strathos, 728 F.2d at 21.

      In addition, the language of the Sherman Act seems to require application of

the intracorporate conspiracy doctrine to section one claims. “Section one’s

reference to conspiracies ‘in restraint of trade’ implies a requirement of multiple

entities while section two’s prohibition of monopolies aims at a single

conglomerate. If section one's conspiracy charge was satisfied by a single

corporate entity, it would arguably render section two meaningless.” See Hartley,

678 F.2d at 971. By contrast, § 1985(2) requires simply that “two or more

persons” conspire and there is no indication to the contrary in the legislative

history. Moreover, the roots of § 1985 lie in the Civil Rights Act of 1871, the Ku

Klux Klan Act, and we doubt Congress intended for the Klan to be able to escape

liability by incorporating.

      Because plaintiff has adequately alleged a conspiracy under § 1985(2), the

                                          6
judgment of the district court is reversed as to the § 1985 claim.2

               II. Intentional Infliction of Emotional Distress Claim

       The statute of limitations governing a claim for intentional infliction of

emotional distress under Georgia law is two years. O.C.G.A. § 9-3-33. Filing a

complaint tolls the statute of limitations if (a) proper service of process is perfected

within five days of the filing of the complaint or (b) plaintiff diligently attempted

to perfect service. See O.C.G.A. § 9-11-4; Cambridge Mut. Fire Ins. Co. v.

Claxton, 720 F.2d 1230, 1232 (11th Cir. 1983); Webb v. Murphy, 236 S.E.2d 840,

841 (Ga. App. 1977). To perfect service under Georgia law, the plaintiff must

either personally serve defendants or obtain a waiver of personal service.

O.C.G.A. § 9-11-4. The district court found plaintiff’s state law claims barred by

Georgia’s statute of limitations because plaintiff did not perfect service on the

defendants within five days of filing the complaint nor did he diligently attempt to

perfect service.

       2
          Defendants also contend plaintiff can not meet the injury requirement of his § 1985
claim because he was an at will employee. See Morast v. Lance, 807 F.2d 926, 932 (11th Cir.
1987) (discharged at will employee had no constitutionally protected interest in continued
employment and therefore did not suffer actual injury). The court rejected defendants’ argument
and the Morast decision. The court was correct. Subsequent to the court’s decision, the
Supreme Court held that an at will employee was “injured in his person or property” and thus
could state a claim for damages under § 1985. Haddle v. Garrison, 119 S.Ct. 489, 492 (1998).

                                               7
      Whether plaintiff diligently attempted to perfect service is a question for the

trial court which must decide “whether the plaintiff showed that he acted in a

reasonable and diligent manner in attempting to ensure that a proper service was

made as quickly as possible.” Robinson v. Stuck, 390 S.E.2d 603, 604 (Ga. App.

1990). The court did not abuse its discretion in finding that plaintiff’s delay in

perfecting service was unreasonable. See Cambridge, 720 F.2d at 1233 (“trial

court is vested with discretion to determine the cause of the delay, and if the trial

court determines that the delay is attributable to the plaintiff and so dismisses the

complaint, the court of appeals will not intervene”); Robinson v. Green, 491 S.E.2d

95, 97 (Ga. App.1997) (perfecting service 40 days after filing of complaint

constitutes failure to exercise due diligence); Cantin v. Justice, 480 S.E.2d 250,

251-52 (Ga. App. 1997) (perfecting service 19 days after filing of complaint

constitutes failure to exercise due diligence). Plaintiff served the defendants by

mail within five days of filing his complaint but he never obtained a waiver of

personal service. He then waited 44 days before personally serving the first

defendant. The last defendant was not served until 65 days after the filing of the

complaint. Plaintiff’s contention that he was unaware of the Georgia requirements

or that they had anything to do with the statute of limitations is not a compelling

reason for the failure of timely service.

                                            8
       Because the statute of limitations expired, we affirm the judgment of the

district court on plaintiff’s intentional infliction of emotional distress claim without

considering whether defendants’ alleged conduct was sufficiently extreme,

outrageous and egregious as to give rise to a cause of action for intentional

infliction of emotional distress.

                                       III. Conclusion

       We REVERSE the district court on the § 1985 claim and AFFIRM the decision on the

intentional infliction of emotional distress claim. The case is REMANDED for consideration of

plaintiff’s § 1985 claim and Lockheed’s counterclaims.

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