HomeMy WebLinkAbout01-0315 CivilTHOM LEWIS,
Plaintiff
Vo
THE SMITH AGENCY,
INC. and WILLIAM J.
SMITH,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
NO. 01-0315 CIVIL TERM
IN RE: DEFENDANTS' PRELIMINARY OBJECTIONS
TO PLAINTIFF'S SECOND AMENDED COMPLAINT
BEFORE BAYLEY and OLER, JJ.
OPINION and ORDER OF COURT
OLER, J., August 2, 2001.
In this action arising out of a business relationship between an entertainer
and a booking agency and its president, the entertainer has sued the agency and the
president. Plaintiff's complaint consists of claims against the agency for breach of
contract and unjust enrichment and claims against both the agency and the
president for violation of Pennsylvania's Wage Payment and Collection Law,
misappropriation of the right of publicity, violation of the federal Lanham
Trademark Act, and tortious interference with prospective business relations.
For disposition at this time are preliminary objections filed by Defendants
to Plaintiff's second amended complaint. The preliminary objections consist of (a)
a motion to dismiss all claims against the agency's president on personal
jurisdiction grounds, (b) a demurrer to the claims against the president for
misappropriation of the right of publicity, violation of the federal Lanham
Trademark Act, and tortious interference with prospective business relations, and
(c) a demurrer to the claim against both the agency and the president for violation
of Pennsylvania's Wage Payment and Collection Law.
The motion to dismiss on personal jurisdiction grounds is based upon lack
of proper service upon the agency's president. However, Defendants have advised
that this preliminary objection is to be deemed withdrawn. ~
The demurrer to the claims against the president for misappropriation of the
right of publicity, violation of the federal Lanham Trademark Act, and tortious
interference with prospective business relations is based upon the fact that the
president was not a party to the transaction between Plaintiff and the agency. The
demurrer to the claim against the agency and the president for violation of
Pennsylvania's Wage Payment and Collection Law is, as to the president, based
upon the fact that the president was not a party to the transaction between Plaintiff
and the agency, and, as to both the agency and the president, based upon the
argument that the transaction was not within the purview of the act.
The matter was argued on July 25, 2001. For the reasons stated in this
opinion, Defendants preliminary objections will be deemed withdrawn or denied.
STATEMENT OF FACTS
The allegations of Plaintiff's second amended complaint may be
summarized as follows. Plaintiff is Thom Lewis, an adult resident of
Mechanicsburg, Cumberland County, Pennsylvania, and a musician.2 Defendant
Smith Agency, Inc., is a Michigan corporation engaged in the business of booking
musical performances at various colleges.3 Defendant William J. Smith is an adult
individual who is the owner, operator, president, agent and representative of the
4
agency.
By a contract dated March 12, 1999, Defendant Smith Agency, Inc., and
Plaintiff entered into an agreement whereby the agency agreed to book Plaintiff
for at least 27 performances per year at colleges during the period from March 15,
Defs.' Br. Supp. Prelim. Objections Second Am. Compl. at 2.
Pl.'s Second Am. Compl. paras. 1, 5.
Pl.'s Second Am. Compl. paras. 2, 5.
Pl.'s Second Am. Compl. paras. 3-5; Pl.'s Second Am. Compl. Ex. A at 2.
2
1999, until March 15, 2001.5 With respect to compensation for the performances,
the contract provided as follows:
Payment by the AGENCY to the ARTIST will be 80% of the
gross contract fee 10 days following receipt of payment from
COLLEGE. AGENCY commission will be 20% of gross
contract fee.6
The contract was executed on behalf of Defendant Smith Agency, Inc., by
Defendant William J. Smith, in his capacity as president of the corporation.7
Count I of Plaintiff's complaint is for breach of contract against Defendant
agency. It alleges that Plaintiff performed at six colleges pursuant to the contract
during the months of October, November and December, 2000, that he was not
compensated for the performances by the agency following demand therefor, and
that payment for the performances had been received by the agency from the
colleges.8 Damages in the amount of $3,315.00 are demanded.9
Count II is for unjust enrichment against Defendant agency, based upon the
agency's alleged failure to make proper disposition of the money received,l°
Damages in the amount of $3,315.00 are demanded.~
Count III is for violation of Pennsylvania's Wage Payment and Collection
Law against both defendants. It alleges that Defendant William J. Smith met the
criteria of an "employer" under the act, and that the failure of the defendants to
forward the money due Plaintiff represented a violation of the act.~2 Damages in
Pl.'s Second Am. Compl.
Pl.'s Second Am. Compl.
Pl.'s Second Am. Compl.
Pl.'s Second Am. Compl.
Pl.'s Second Am. Compl.
l0 Pl.'s Second Am. Compl.
~ Pl's. Second Am. Compl.
~2 Pl.'s Second Am. Compl.
para. 5; Pl.'s Second Am. Compl. Ex. A.
para.5; Pl.'s Second Am. Compl. Ex. A at 1.
para. 5; Pl.'s Second Am. Compl. Ex. A at 2.
paras. 12-13, 18-19.
at 3 (Count I, ad damnum clause).
paras. 20-23.
at 4 (Count II, ad damnum clause).
paras. 24-28.
3
the amount of $4,143.75 (125% of the money due), and attorney's fees, are
demanded. ~ 3
Count IV is for misappropriation of the right of publicity against both
defendants. It alleges that Defendants falsely advertised to colleges that the
agency represented Plaintiff, after the term of the contract had expired.~4 Punitive
damages in an unliquidated amount are demanded.~5
Count V is for violation of the federal Lanham Trademark Act against both
defendants. It alleges that Defendants' misappropriation of Plaintiff's name as
alleged in the preceding count was violative of the act.~6 Punitive damages in an
unliquidated amount are demanded. ~7
Count VI is for tortious interference with prospective business relations
against both defendants. It alleges that, when certain colleges contacted
Defendant William J. Smith and other employees of the agency for purposes of
booking Plaintiff, they were maliciously told that Plaintiff was no longer giving
performances,la Compensatory and punitive damages in unliquidated amounts are
demanded. ~ 9
Defendants' preliminary objections raising the issues of personal
jurisdiction and legal sufficiency discussed above were filed on May 3,2001.
DISCUSSION
Statement of Law
Demurrer "The test on preliminary objections [which would result in
dismissal of a claim] is whether it is clear and free from doubt from all of the facts
~ Pl.'s
~4 Pl.'s
~5 Pl.'s
16 PI.'s
17 PI.'s
~8 PI.'s
19 PI.'s
Second Am. Compl.
Second Am. Compl.
Second Am. Compl.
Second Am. Compl.
Second Am. Compl.
Second Am. Compl.
Second Am. Compl.
para. 28, at 5 (Count IV ad damnum clause).
paras. 30-33.
at 6 (Count IV ad damnum clause).
para. 35.
at 6 (Count V ad damnum clause).
paras. 37-41.
para. 41, at 7 (Count VI ad damnum clause).
4
pleaded that the pleader will be unable to prove facts legally sufficient to establish
his right to relief." Bowery. Bower, 531 Pa. 54, 57, 611 A.2d 181, 182 (1992). In
determining whether to grant such a preliminary objection, a "[c]ourt must
consider as true all of the well-pleaded material facts set forth in [the pleading
challenged] and all reasonable inferences that may be drawn from those facts." Id.
at 57, 611 A.2d at 182. Moreover, such "preliminary objections will only be
sustained if clear and free from doubt." Triage, Inc. v. Pa. Dept. of Transp., 113
Pa. Commw. 348, 354 n.7, 537 A.2d 903,907 n.7 (1988).
Liability of agent. An individual acting as an agent for a disclosed principal
is not personally liable on a contract between the principal and a third party unless
the agent specifically agrees to liability. Rossi v. Pa. State Univ., 340 Pa. Super.
39, 56, 489 A.2d 828, 837 (1985).
Pennsylvania Wage Payment and Collection Law. Under Pennsylvania's
Wage Payment and Collection Law,2° an employee may maintain a civil action
against an employer for unpaid wages. Act of July 14, 1961, P.L. 637, §9.1, as
amended, 43 Pa. C.S. §260.9a. An employer, for purposes of the act,
[i]ncludes every corporation . . . and any . . . officer of any
[corporation] employing any person in this Commonwealth.
Act of July 14, 1961, P.L. 637, §2.1, 43 Pa. C.S. §260.2a (emphasis added). Thus,
in appropriate circumstances a corporate officer will be deemed an employer
under the act. Mohney v. McC/ure, 390 Pa. Super. 338, 343-45, 568 A.2d 682,
685-86 (1990), aff'd, 529 Pa. 430, 604 A.2d 1021 (1992).
Wages, for purposes of the act,
[i]ncludes all earnings of an employe, regardless of whether
determined on time, task, piece, commission or other method
of calculation. The term "wages" also includes fringe benefits
or wage supplements whether payable by the employer from
his funds or from amounts withheld from the employes' pay by
the employer.
20 Act of July 14, 1961, P.L. 637, as amended, 43 Pa. C.S. §§ 260.1-.12 (2000).
5
43 Pa. C.S. §260.2a.
Misappropriation of right of publicit~v. Under Section 46 of the
Rcstatcmem (Third) of Unfair Competition, a "right of publicity" has been
described as follows:
One who appropriates the commercial value of a person's
idemity by using without consem the person's name, likeness,
or other indicia of idemity for the purposes of trade is subject
to liability ....
Restatemem (Third) of Unfair Competition §46 (1995). A cause of action based
upon this right has been deemed by a federal court to be consistem with
Permsylvania law. Sealev. Gramerc~v Pictures, 964 F. Supp. 918, 929 (E.D. Pa.
1997), afl'd, 156 F.3d 1225 (3d Cir. 1998).
Lanham Trademark ~Ict. Under the federal Lanham Trademark Act,2~ a
civil action may be brought against a person
who, on or in connection with any.., services,.., uses in
commerce any.., name ... or... false or misleading
description of fact, or false or misleading representation of fact
· .. which.., is likely to cause confusion, or to cause mistake,
or to deceive as to the affiliation, connection, or association of
such person with another person, or as to the origin,
sponsorship, or approval of his or her.., services, or
commercial activities by another person, or in commercial
advertising or promotion, misrepresents the nature,
characteristics, qualities, or geographic origin of his or her or
another person's.., services, or commercial activities.
15 U.S.C. § 1125(a)(1)(2001).
Tortious interference with prospective business relations· It has been held
in Pennsylvania "that a cause of action exists where a person imemionally and
improperly imerferes with another's prospective contractual relation," provided
that the imerference "induce[s] or cause[s] a third person not to emer imo the
prospective relationship." b]enness~v v. Santiago, 708 A.2d 1269, 1278 (Pa. Super.
2~ 15 U.S.C. §§ 1051 etseq.
6
Ct. 1998), quoting Yaindl v. Ingersoll-Rand Co., 281 Pa. Super. 560, 422 A.2d
611,624 (1980) (emphasis omitted).
Application of Law to Facts
Defendants' demurrer to Plaintiff's claims against Defendant William J.
Smith for misappropriation of the right of publicity, violation of the federal
Lanham Trademark Act, and tortious interference with prospective business
relations is based upon the fact that he was not a party to the alleged contract
between the agency and Plaintiff. in this regard, the demurrer rests upon the rule
in contract law that an agent who contracts on behalf of a disclosed principal will
not generally be personally liable on the contract.
However, a careful review of the complaint reveals that the causes of action
in question are not predicated upon contractual liability, instead, they are
premised upon allegedly wrongful conduct independent of the contract. For this
reason, the rule relied upon is not controlling and Defendants' demurrer cannot be
sustained on that ground.
Defendants' demurrer to Plaintiff's claim under Pennsylvania's Wage
Payment and Collection Law is (as to both defendants) based upon the argument
that any obligation under the contract to forward payment to Plaintiff for his
performances was not within the purview of the act and (as to Defendant William
J. Smith) based upon the argument that liability under the act cannot attach to a
corporate officer where the alleged employment contract was with the corporation.
However, the broad definitions under the act of "wages" and "employer" militate
against a holding that it is clear and free from doubt that Plaintiff can not recover
on his claim, particularly where issues of intent and trade practice may be involved
in the interpretation of Plaintiff's contract with the agency, and where the statute
expressly authorizes the imposition of liability upon corporate officers in
appropriate circumstances. For these reasons, Defendants' demurrer can not be
sustained on these grounds.
Based upon the foregoing, the following order will be entered:
7
ORDER OF COURT
AND NOW, this 2nd day of August, 2001, after careful consideration of
Defendants' preliminary objections to Plaintiff's second amended complaint, and
for the reasons stated in the accompanying opinion, it is ordered and directed as
follows:
1. Defendants' preliminary objection based upon lack of
personal jurisdiction over Defendant William J. Smith is
deemed withdrawn; and
2. Defendants' remaining preliminary objections are
denied.
BY THE COURT,
Mark K. Emery, Esq.
5115 East Trindle Road
Mechanicsburg, PA 17055
Attorney for Plaintiff
William A. Addams, Esq.
Law Office of Michael J. Hanft
19 Brookwood Avenue, Suite 106
Carlisle, PA 17013
Attorney for Defendants
/s/J. Wesley Oler, Jr.
J. Wesley Oler, Jr., J.
9
THOM LEWIS,
Plaintiff
Vo
THE SMITH AGENCY,
INC. and WILLIAM J.
SMITH,
Defendants
IN THE COURT OF COMMON PLEAS OF
CUMBERLAND COUNTY, PENNSYLVANIA
CIVIL ACTION - LAW
NO. 01-0315 CIVIL TERM
IN RE: DEFENDANTS' PRELIMINARY OBJECTIONS
TO PLAINTIFF'S SECOND AMENDED COMPLAINT
BEFORE BAYLEY and OLER, JJ.
ORDER OF COURT
AND NOW, this 2nd day of August, 2001, after careful consideration of
Defendants' preliminary objections to Plaintiff's second amended complaint, and
for the reasons stated in the accompanying opinion, it is ordered and directed as
follows:
1. Defendants' preliminary objection based upon lack of
personal jurisdiction over Defendant William J. Smith is
deemed withdrawn; and
2. Defendants' remaining preliminary objections are
denied.
BY THE COURT,
Mark K. Emery, Esq.
5115 East Trindle Road
Mechanicsburg, PA 17055
Attorney for Plaintiff
J. Wesley Oler, Jr., J.
William A. Addams, Esq.
Law Office of Michael J. Hanft
19 Brookwood Avenue, Suite 106
Carlisle, PA 17013
Attorney for Defendants