United States District Court, E.D. Pennsylvania
March 31, 2004.
HAROLD L. CARE; LAWRENCE CLAAR; TREANTAFFELO KARAHALIAS; MICHAEL KLINE; GORDON KONEMANN; FRANCIS A. ROSSI; and LEE G. SMITH, Plaintiffs
THE READING HOSPITAL AND MEDICAL CENTER; JAKOB (JAPP) OLREE, Individually, and in His Capacity as Director of Facilities Management for The Reading Hospital and Medical Center, Inc.; MICHAEL FORBES, Individually, and in His Capacity as Assistant Director of Facilities Management for The Reading Hospital and Medical Center, Inc.; MARK BALATGEK, Individually, and in His Capacity as Maintenance Manager for The Reading Hospital and Medical Center, Inc.; RICHARD MABLE, Individually, and in His Capacity as Vice President of the Engineering Department for The Reading Hospital and Medical Center, Inc.; PAUL McCOY, Individually, and in His Capacity as the Former Chief Engineer for The Reading Hospital and Medical Center, Inc.; and JOHN AND JANE DOES 1 Through 20, Individually and in Their Capacities as Employees of The Reading Hospital and Medical Center, Inc., Defendants
The opinion of the court was delivered by: JAMES KNOLL GARDNER, District Judge
This matter is before the court on The Reading Hospital and Medical
Center, Inc.'s, Jakob Olree's, Michael Forbes', Richard Mable's and Paul
McCoy's Motion to Dismiss, which motion was filed July 21, 2003.
Plaintiff's Answer to Motion to Dismiss of Defendants Reading Hospital
and Medical Center, Inc., Jakob Olree, Michael Forbes, Richard Mable and
Paul McCoy was filed August 1, 2003. The Reading Hospital and Medical
Center, Inc.'s, Jakob Olree's, Michael Forbes', Richard Mable's and Paul
McCoy's Reply Memorandum in Support of their Motion to Dismiss was filed
October 6, 2003. For the reasons expressed below, we grant in part and
deny in part defendants' motion to dismiss.
Specifically, we deny defendants' motion to dismiss Counts I through
VII and a portion of Count XIII of Plaintiffs' Complaint alleging
invasion of privacy relating to incidents occurring prior to January 22,
2002. We grant defendants' motion to dismiss Counts X, XI, XII, XIV, XV,
XVI, XVII and that portion of Count XIII alleging the January 22, 2002
incident involving invasion of privacy.
Jurisdiction is based upon federal question jurisdiction pursuant to
28 U.S.C. __ 1331 and 1441(b). Venue is proper pursuant to 28 U.S.C. ___
1391(b) because the events giving rise to plaintiffs' claims allegedly
occurred in this judicial district, namely, Berks County, Pennsylvania.
On June 16, 2003 Plaintiffs' Complaint ("Complaint") was filed in
the Court of Common Pleas of Berks County,
Pennsylvania. The Complaint alleges multiple violations of the
Pennsylvania Wire Tapping and Electronic Surveillance Control Act
("Wiretap Act")*fn1 (Counts I, II, III, V, VI, and VIII) and Title III
of the Omnibus Crime Control and Safe Streets Act of 1968 ("Title III")*fn2
(Counts IV, VII and IX), as well as state law claims for civil
conspiracy (Counts X, XI and XII), invasion of privacy (Count XIII),
negligent supervision (Counts XIV, XV and XVI) and respondeat superior
liability (Count XVII). On July 14, 2003 defendant The Reading Hospital
and Medical Center together with individual defendants Jakob (Japp)
Olree, Michael Forbes, Richard Mable and Paul McCoy, with the concurrence
of defendant Mark Balatgek,*fn3 removed this action to this court.*fn4
not contested removal.
Based upon the allegations in Plaintiffs' Complaint and the exhibit
attached thereto, which we must accept as true for purposes of this
motion, the operative facts are as follows.
Plaintiffs Harold L. Care, Lawrence Claar, Treantaffelo Karahalias,
Michael Kline, Gorden Konemann, Francis A. Rossi and Lee G. Smith are
each employees of defendant The Reading Hospital and Medical Center
("RHMC") and worked in its engineering department.
Defendant Richard Mable is the Vice-President of the Engineering
Department for RHMC. Defendant Jakob Olree is the Director of Facilities
Management for RHMC and reported to defendant Mable. Defendant Michael
Forbes is the Assistant Director of Facilities Management for RHMC and
reported to defendant Olree. Defendant Mark Balatgek was the former
Maintenance Manager for RHMC and oversaw certain day and night shift
supervisors. Finally, defendant Paul McCoy was the Chief Engineer for
RHMC until his retirement in 1997.
Since prior to defendant McCoy's retirement in 1997 there have been
allegedly unlawful interceptions of plaintiffs' oral communications by
one or more of the
defendants. The last such interception occurred on January 22, 2002
during a meeting conducted by labor/management consultant Sue McQuen and
the Engineering Department employees, which included plaintiffs.
On January 22, 2002 plaintiffs found a tape recorder in defendant
Balatgek's locker. One of the employees (not a plaintiff) telephoned
defendant Olree to report the finding of the tape recorder. Shortly
thereafter defendants Olree, Forbes and Mable, together with defendant
Balatgek and the hospital security supervisor Michael Resch, arrived at
the meeting location and retrieved the tape recorder and tape; and
defendant Mable took possession of the items.
Several employees, including all plaintiffs, filed a criminal complaint
in West Reading, Berks County, Pennsylvania. On January 24, 2002 West
Reading police executed a search warrant and seized the tape and
recording device. Thereafter, on January 25, 2002 defendant Balatgek gave
a formal Statement to police.
Plaintiffs contend that the meeting with the labor/management
consultant was supposed to be confidential. Specifically, they contend
that while the consultant was going to report back to management certain
concerns raised by the employees, the names of the employees expressing
would be kept confidential.
Moreover, in his Statement to the West Reading police, defendant
Balatgek stated that he had been told by a management level employee,
Rich Pavanarias, that defendants Olree and McCoy had performed this type
of surveillance of employees often in the past and that defendant Olree
had in the past specifically asked Balatgek to do this. Thus, Plaintiffs'
Complaint asserts that the alleged interception of oral communications
was a continuing course of conduct by defendants.
STANDARD OF REVIEW
A Rule 12(b)(6) motion to dismiss examines the sufficiency of the
Complaint. Conley v. Gibson, 355 U.S. 41, 45, 78 S.Ct. 99, 102, 2 L.Ed.2d
80, 84 (1957). In determining the sufficiency of the Complaint the court
must accept all plaintiffs' well-pled factual allegations as true and
draw all reasonable inferences there from in favor of plaintiffs. Graves
v. Lowery, 117 F.3d 723, 726 (3d Cir. 1997).
[T]he Federal Rules of Civil Procedure do not
require a claimant to set out in detail the facts
upon which he
bases his claim. To the contrary, all the Rules
require is "a short and plain statement of the claim"
that will give the defendant fair notice of what the
plaintiff's claim is and the grounds upon which it
Conley, 355 U.S. at 47, 78 S.Ct. at 103, 2 L.Ed.2d at 85. (Internal
footnote omitted.) Thus, a court should not grant a motion to dismiss
unless it appears beyond a doubt that the plaintiffs can prove no set of
facts in support of his claim which would entitle them to relief.
Graves, 117 F.3d at 726 citing Conley, 355 U.S. at 45-46, 78 S.Ct. at
102, 2 L.Ed.2d at 84.
In deciding motions to dismiss pursuant to Rule 12(b)(6), courts
generally consider only the allegations in the Complaint, exhibits
attached to the Complaint, matters of public record, and documents that
form the basis of the claim.
Lum v. Bank of America, No. 01-4348, 2004 U.S. App. LEXIS 4637 at *9,
n.3 (3d Cir. Mar. 11, 2004).
Statute of Limitations
Initially, defendants assert that certain of plaintiffs' claims are
barred by the statute of limitations. Specifically, defendants contend
that plaintiffs' claims for invasion of privacy are governed by a
one-year statute of limitations.*fn5 Defendants aver that the most
recent allegations of invasion of privacy occurred on January 22, 2002;
and plaintiffs did not file their Complaint until June 16, 2003, more
than one year later. Thus, defendants argue that the statute of
limitations on this incident has expired and that Count XIII of
Plaintiffs' Complaint should be dismissed.
Moreover, defendants assert that plaintiffs' claim for conspiracy to
invade their right to privacy is also time-barred because the time period
for the statute of limitations on a conspiracy is controlled by the
substantive offense alleged to be the object of the conspiracy.
Defendants rely on Chappelle v. Case, 487 F. Supp. 843 (E.D. Pa. 1980)
for this proposition.
Defendants cite McKeeman v. Corestates Bank, N.A., 751 A.2d 655, 660
(Pa. Super. 2000) for the proposition that absent a civil cause of action
for a particular act, there can
be no cause of action for civil conspiracy. Hence, defendants assert that
because plaintiffs' underlying cause of action for invasion of privacy is
time-barred, any conspiracy to commit that offense is also time-barred.
Thus, defendants contend that Count XII of Plaintiffs' Complaint must be
Next, defendants assert that all claims for unlawful interception,
attempted interception, or procuring under either the Pennsylvania
Wiretap Act or Title III occurring prior to June 16, 2001 should be
dismissed because they are outside the two-year statute of limitations
for such actions. Specifically, defendants assert that Pennsylvania law
provides a two-year statute of limitations for all other intentional or
negligent wrongs pursuant to 42 Pa. C.S.A. _ 5524. Moreover, in Bristow
v. Clevenger, 80 F. Supp.2d 421 (M.D. Pa. 2000) United States District
Judge Sylvia H. Rambo determined that the two-year statute of limitations
applied to a Wiretap Act cause of action.
Finally, defendants assert that there is a two-year statute of
limitations pursuant to Title III.*fn6 Defendants aver that because
plaintiffs did not file this action until June 2003, any alleged
violations of Title III prior to June 2001 are time-barred. Thus,
defendants assert that the
statute of limitations bars all claims contained in Counts I through VII
and the conspiracy counts in X and XI of Plaintiffs' Complaint asserted
prior to June 16, 2001.
Initially, plaintiffs concede*fn7 that their invasion-of-privacy claim
based upon the January 22, 2002 incident is barred by the statute of
limitations. Accordingly, we grant defendants motion to dismiss this
portion of Count XIII of Plaintiffs' Complaint.
Next, plaintiffs contend that their cause of action for invasion of
privacy should not be dismissed regarding alleged incidents occurring in
the past because plaintiffs assert that they did not discover the prior
instances of potential claims for invasion of privacy, or for that matter
earlier alleged claims under either the Wiretap Act or Title III, until
they obtained a copy of defendant Balatgek's "confession"*fn8 on October
10, 2002. Plaintiffs aver that they were unaware of defendants' alleged
continuing course of conduct in surreptitiously using electronic
surveillance devices to intercept or attempt to intercept the oral
communications or conversations of plaintiffs and others until they were
in receipt of defendant Balatgek's Statement.
Plaintiffs further aver that they were not aware that defendant
Balatgek made a Statement to the police until his arraignment on criminal
charges on October 2, 2002. Plaintiffs rely on the decision of the late
United States District Judge Robert S. Gawthrop, III, in Doe v. Kohn,
Graf, P.C., 866 F. Supp. 190, 195 (E.D. Pa. 1994) for the proposition
that under Pennsylvania's discovery rule, a statute of limitations does
not begin to run until such time as the plaintiff has discovered his
injury, or in the exercise of reasonable diligence, should have
discovered the injury. Thus, plaintiffs contend that the statute of
limitations did not begin to run until October 10, 2002 on all claims for
invasion of privacy or claims pursuant to Title III or the Wiretap Act
because that is the date that they came into possession of the
Finally, plaintiffs concede that there is a two-year statute of
limitations in a Title III case. However, plaintiffs contend that there
is a six-year statute of limitations in Wiretap Act cases pursuant to the
Commonwealth Court of Pennsylvania's decision in Boettger v. Miklich,
142 Pa. Commw. 136, 142, 599 A.2d 713, 716 (1991). Hence, notwithstanding
their discovery rule argument, plaintiffs assert that they can seek
damages regarding any alleged violation of the Wiretap Act for six years
preceding the filing of their Complaint.
Initially, we address plaintiffs' assertion that the statute of
limitations on the state law causes of action for
invasion of privacy and for alleged violations of the Pennsylvania
Wiretap Act are tolled pursuant to the Pennsylvania discovery rule.
In Pocono International Raceway Inc., v. Pocono Produce, Inc.,
503 Pa. 80, 468 A.2d 468 (1983), the Supreme Court of Pennsylvania
analyzed the application of the Pennsylvania discovery rule as follows:
As a matter of general rule, a party asserting a
cause of action is under a duty to use all reasonable
diligence to be properly informed of the facts and
circumstances upon which a potential right of recovery
is based and to institute suit within the prescribed
statutory period. Thus, the statute of limitations
begins to run as soon as the right to institute and
maintain a suit arises; lack of knowledge, mistake or
misunderstanding do not toll the running of the
statute of limitations, even though a person may not
discover his injury until it is too late to take
advantage of the appropriate remedy, this is incident
to a law arbitrarily making legal remedies contingent
on mere lapse of time. Once the prescribed statutory
period has expired, the party is barred from bringing
suit unless it is established that an exception to the
general rule applies which acts to toll the running of
The "discovery rule" is such an exception, and
arises from the inability of the injured, despite the
exercise of due diligence, to know of the injury or
its cause. Thus, in the case of a subsurface injury in
which, unknown to the plaintiff, the defendant removes
coal from his land via access originating on the
land, the inability of the plaintiff, despite the
exercise of diligence, to know of the trespass, tolls
the running of the statute, for "no amount of
vigilance will enable him to detect the approach of a
trespasser who may be working his way through the coal
seams underlying adjoining lands," and until such time
as the plaintiff discovers, or reasonably should have
discovered, the trespass, the running of the statute
is tolled. Likewise, in a case of medical malpractice
involving the failure of a surgeon to remove an
implement of surgery, it is the inability of the
plaintiff to ascertain the presence of the offending
implement which prevents the commencement of the
running of the statute, for "[c]ertainly he could not
open his abdomen like a door and look in; certainly he
would need to have medical advice and counsel." The
salient point giving rise to the equitable application
of the exception of the discovery rule is the
inability, despite the exercise of diligence by the
plaintiff, to know of the injury. A court presented
with an assertion of applicability of the "discovery
rule" must, before applying the exception of the
rule, address the ability of the damaged party,
exercising reasonable diligence, to ascertain the fact
of a cause of action.
503 Pa. at 84-85, 468 A.2d at 471. (Emphasis in original.) (Citations
In this case, based upon the Statement of defendant Balatgek given to
the West Reading Police Department, plaintiffs contend that they were
unaware that defendants had been allegedly surreptitiously recording the
oral communications of the employees of the Engineering Department
since prior to Paul McCoy's retirement in 1997. Furthermore, plaintiffs
contend in their response to defendants' within motion that they could
not have known about these alleged recordings until they received a copy
of defendant Balatgek's Statement after his October 2, 2002 arraignment
on the criminal charges related to the January 22, 2002 incident.
Also, in the alternative, plaintiffs assert that even if the court
determines that January 22, 2002 is the earliest date that plaintiffs
should have been aware of defendants perpetration of additional incidents
of allegedly illegal interceptions, all of the causes of action under
either the Wiretap Act or Title III survive pursuant to the discovery
We note that the two traditional areas where the discovery rule
previously has been applied are the two circumstances reviewed by the
Supreme Court of Pennsylvania in Pocono Raceway. Traditionally, the
discovery rule has been applied where the injury involves either a
subsurface injury or in a medical malpractice action.
However, in Doe Judge Gawthrop held that the discovery rule applied in
an invasion-of-privacy case where plaintiff alleged that his former
employer was, while plaintiff was an employee, secretly opening and
personal mail, without notifying him. Plaintiff did not find out about his
employer opening his mail until after the litigation had commenced.
There, the court held that the discovery rule applied to toll the statute
of limitations until plaintiff was aware of the alleged invasion of
privacy. 866 F. Supp. at 195. We find that decision persuasive in our
determination of whether to apply the discovery rule in this case.
If the Supreme Court of Pennsylvania has not addressed a precise
issue, a prediction must be made taking into consideration "relevant
state precedents, analogous decisions, considered dicta, scholarly
works, and any other reliable data tending convincingly to show how the
highest court in the state would decide the issue at hand." Nationwide
Mutual Insurance Company v. Buffetta, 230 F.3d 634, 637 (3d. Cir. 2000)
(citation omitted). "The opinions of intermediate state courts are `not
to be disregarded by a federal court unless it is convinced by other
persuasive data that the highest court in the state would decide
otherwise.'" 230 F.3d at 637 citing West v. American Telephone and
Telegraph Co., 311 U.S. 223, 61 S.Ct. 179, 85 L.Ed. 139 (1940).
We are unaware of any appellate decision from either
the Supreme Court of Pennsylvania or any Pennsylvania intermediate
appellate court where the discovery rule has been applied to either a
cause of action for invasion of privacy or to a violation of the Wiretap
The only decision of which we are aware is the Doe case where Judge
Gawthrop applied the discovery rule to an invasion of privacy claim. For
the following reasons, we predict that the Supreme Court of Pennsylvania
would permit the application of the discovery rule to either a cause of
action for invasion of privacy or pursuant to the Wiretap Act.
Plaintiffs' allegations of surreptitious recording of conversations by
defendants constitute the type of conduct that belies easy detection.
Absent someone involved in the scheme revealing the activity as defendant
Balatgek did in his Statement to the West Reading Police Department, or
being caught in the act as Mr. Balatgek was on January 22, 2002, there
would be no way for plaintiffs to know that their conversations were
being recorded in violation of their rights.
We find this type of conduct analogous to the causes of action where
the discovery rule has been traditionally applied. In a case where a
trespasser is removing coal from under the ground, the landowner would
ordinarily have no
reason to know or believe that his rights are being violated. In
addition, a patient who has a sponge or some other surgical device left
in his body after surgery would ordinarily have no reason to know that
such an incident has occurred.
In this case, we conclude that plaintiffs would have had no reason to
believe that agents of their employer were secretly recording their
conversations in the workplace. Thus, it would not be until someone was
caught perpetrating this activity or admitted such conduct, that
plaintiffs would have any reason to know, or in the exercise of due
diligence have reason to believe, that such conduct was occurring.
As noted by former Chief United States District Judge for the Eastern
District of Pennsylvania Edward N. Cahn,
We recognize the particular difficulties plaintiffs
face in presenting evidence to support wiretap
claims. "The fact that most of the plaintiffs have no
personal, first-hand knowledge that any particular
[oral communication was recorded] is not remarkable
. . . [T]he intentional [torts] of wiretapping [and
invasion of privacy] created [under Pennsylvania law
are] obviously [ones] which by [their] very nature
[are] unknown to the [plaintiffs]."
Gross v. Taylor, No. Civ. A. 96-6514, 1997 U.S. Dist. LEXIS 11657 at *16
(E.D. Pa. Aug. 5, 1997). (Citation omitted.)
Because we conclude that this case presents issues of the exact type
which requires application of the Pennsylvania discovery rule, we predict
that the Supreme Court of Pennsylvania, if given the opportunity under a
case alleging similar facts, would apply the discovery rule to toll the
statute of limitations in a matter involving either an invasion of
privacy claim or a claim pursuant to the Wiretap Act.
In Title III cases, there is a built-in discovery rule pursuant to the
statute. "A civil action under this section may not be commenced later
than two years after the date upon which the claimant first has a
reasonable opportunity to discover the violation." 18 U.S.C. _ 2520(e).
Thus, we do not have to determine whether the discovery rule applies
under federal law because it is written into the applicable statute.
In addition to the foregoing, while a determination of whether the
statute of limitations has run is usually a question of law for the judge
to decide, where the issue involves a factual determination, that
determination is for the jury. Resolution Trust Corporation v. Farmer,
865 F. Supp. 1143, 1158 (E.D. Pa. 1994).
Moreover, Pennsylvania courts have extended this
concept to include a determination by a jury of whether plaintiffs knew,
or with the exercise of diligence, should have known, about a cause of
action for purposes of applying the discovery rule. See Crouse v. Cyclops
Industries, 560 Pa. 394, 745 A.2d 606 (2000); Gallucci v. Phillips &
Jacobs, Inc., 418 Pa. Super. 306, 614 A.2d 284 (1992).
Finally, if a jury determines that in the exercise of diligence,
plaintiffs could not have known about their causes of action until
October 10, 2002,*fn9 then we would not have to decide whether a
two-year or six-year statute of limitations applies to plaintiffs' cause
of action pursuant to the Wiretap Act. This is because the statute of
limitations for plaintiffs' causes of action for invasion of privacy, the
Wiretap Act and Title III would all be tolled until October 10, 2002
(based upon the discovery rule) as the result of such a jury finding. The
filing of Plaintiffs' Complaint on June 16, 2003 (eight months after
October 10, 2002) would be well within a one-, two-, or six-year statute
If on the other hand, the jury determines that plaintiffs should have
known about their causes of action
under the Wiretap Act, or could have discovered it in the exercise
of reasonable diligence, we would then make a determination regarding the
length of the applicable statute of limitations in a Wiretap Act case.
Thus, it is not free and clear from doubt whether the discovery rule
permits plaintiffs' causes of action for incidents of invasion of privacy
which occurred prior to January 22, 2002. Nor is it free and clear from
doubt whether the discovery rule permits plaintiffs' causes of action for
alleged violations of the Wiretap Act and Title III which occurred prior
to the statute-of-limitations period. And because it appears that such
determinations are required to be made by the jury, we deny defendants'
motion to dismiss Counts I, II, III, IV, V, VI, VII and XIII of
Plaintiffs' Complaint, which motion is based on defendants' contentions
that these counts are barred by the statute of limitations.
Moreover, we conclude that, at this time, plaintiffs are not limited to
incidents occurring after June 16, 2001 based upon either the Wiretap Act
or Title III. Furthermore, it will be for the jury to determine what
date either January 22, 2002 (the discovery of a tape recorder in
defendant Balatgek's locker), October 10, 2002 (when plaintiffs allegedly
first come into possession of Mr.
Balatgek's Statement to the police), or some date in between that
plaintiffs first discovered the basis for their claims for invasion of
privacy and for violations of Title III and the Wiretap Act. (As noted
above, the invasion of privacy claim relating to the January 22, 2002
incident is barred by the statute of limitations.)
"Oral communication" is defined under the Wiretap Act as: "Any oral
communication uttered by a person possessing an expectation that such
communication is not subject to interception under circumstances
justifying such expectation." 18 Pa.C.S.A. ___ 5702. The expectation of
non-interception must be analyzed by considering whether the speaker
possessed a reasonable expectation of privacy. The standard for analysis
is objective and the subjective expectation of plaintiffs is irrelevant.
Agnew v. Dupler, 533 Pa. 3, 40-41, 717 A.2d 519, 523 (1998).
"Oral communication" is similarly defined under Title III as: "any oral
communication uttered by a person exhibiting an expectation that such
communication is not subject to interception under circumstances
justifying such expectation. . . ." 18 U.S.C. ___ 2510(2).
In this case, defendants contend that the
allegations contained in Plaintiffs' Complaint negate any reasonable
expectation of privacy in the January 22, 2002 meeting. Defendants assert
that plaintiffs were told on numerous occasions that the communications
made by them to the labor/management consultant would be reported back to
On the contrary, plaintiffs assert in their response to defendants'
motion that they had a reasonable expectation of privacy with respect to
their meeting with the labor/management consultant because they had been
assured by management that only legitimate concerns would be forwarded to
management, but that the identities of any employee who made a specific
comment or concern during the meeting would not be revealed.
In paragraphs 35, 36, 37, 38, 40 and 42 of Plaintiffs' Complaint, it is
alleged that the meeting with the labor/management consultant was a
"confidential meeting". Moreover, in paragraph 59 of the Complaint,
plaintiffs allege that they had a reasonable expectation of privacy
regarding their oral conversations not only at the January 22, 2002
meeting, but in all other meetings and conversations while they were
working inside defendant hospital.
Pursuant to the standard of review, we are required
to accept all plaintiffs' well-pled facts as true and may not dismiss a
cause of action unless it is clear and free from doubt that plaintiffs
cannot prevail under any set of facts presented. In applying this
standard, we conclude that plaintiffs adequately assert that they had a
reasonable expectation of privacy and non-interception in the January
22, 2002 meeting and that plaintiffs adequately assert that their
conversations at work prior to January 22, 2002 were subject to a
reasonable expectation of privacy and non-interception.
Accordingly, we deny defendants' motion to dismiss Counts I, II, III,
IV, V, VI and VII, which motion is based upon defendants' assertion that
the conversations of plaintiffs were not "oral communications" pursuant
to either the Wiretap Act or Title III.
A civil conspiracy exists pursuant to Pennsylvania law when: (1) a
combination of two or more persons act with a common purpose to do an
unlawful act or to do a lawful act by unlawful means or for an unlawful
purpose; (2) an overt act is done in pursuit of the common purpose; and
(3) actual legal damage results. Moreover, absent an underlying cause of
action for a particular act, there can be no separate cause of action for
civil conspiracy. McKeeman v. Corestates Bank, N.A., 751 A.2d 655, 660
(Pa. Super. 2000).
Defendants contend that plaintiffs fail to assert a cause of action for
conspiracy because they have not pled an underlying cause of action*fn10
for an invasion of privacy, or pursuant to either the Wiretap Act or
Title III. In addition, defendants assert that because Plaintiffs'
Complaint alleges that all defendants were acting in their official
capacity as agents of defendant RHMC, there can be no conspiracy claim
because acts of agents are acts of the entity itself, and a corporation
cannot conspire with itself.
On the other hand, plaintiffs contend that they have properly pled a
cause of action for civil conspiracy. Specifically, plaintiffs aver that
they have set forth a cause of action for invasion of privacy based upon
events occurring prior to, but not including, the January 22, 2002
incident. In addition, they assert that they have set forth causes of
action under both the Wiretap Act and Title III. Finally, plaintiffs
concede that they have pled that all the individual defendants have acted
as agents of RHMC.
However, plaintiffs assert that defendants will contend that defendant
Balatgek was acting on his own in an ultra vires fashion regarding the
January 22, 2002 incident. Plaintiffs rely on the case of Tyler v.
O'Neill, 994 F. Supp. 603 (E.D. Pa. 1998) for the proposition that
when agents or employees are acting outside the scope of their duties for
the corporation, for personal reasons, and one of the parties to the
conspiracy is not an agent or employee of the corporation, a cause of
action for civil conspiracy exists.
Moreover, plaintiffs rely on Tyler for the proposition that this rule
has been liberally construed so as to allow a civil conspiracy claim to
proceed where agents or employees act outside their corporate roles, even
in the absence of a co-conspirator from outside the corporation. For the
following reasons, we agree with plaintiffs in part; we agree with
defendants in part; and we dismiss plaintiffs' claims for civil conspiracy
in Counts X, XI and XII of Plaintiffs' Complaint.
Initially, based upon our analysis articulated above, we conclude that
plaintiffs have sufficiently pled
causes of action based upon a claim of invasion of privacy and claims
brought pursuant to the Wiretap Act and Title III. Accordingly, we deny
defendants' motion to dismiss on those grounds. However, for the
following reasons, we agree with defendants that a corporation cannot
conspire with its own agents. Thus, we grant defendants' motion to
dismiss on that ground and dismiss Counts X, XI and XII of Plaintiffs'
"A single entity cannot conspire with itself and similarly, agents of a
single entity cannot conspire among themselves." Rutherfoord v.
Presbyterian-University Hospital, 417 Pa. Super. 316, 333-334,
612 A.2d 500, 508 (1992). In this case, plaintiffs allege that all the
individual defendants acted in the course and scope of their employment.*fn11
We find unpersuasive plaintiffs' argument that defendants will assert
that defendant Balatgek was acting in an ultra vires manner and
outside the scope of his employment regarding his activities on January
22, 2002 or before. This contention is belied by Mr. Balatgek's Statement
to the West Reading Police Department which is attached as Exhibit A to
In his Statement, Mark Balatgek contends that he was instructed by
Jakob Olree to record the meeting on January 22, 2002 and that he had
done similar recording in the past at the direction of Mr. Olree. Mr.
Balatgek stated that he knew that the recording was morally wrong, but
that he did not know it was a crime. Moreover, he stated that the reason
that he did this was because he was concerned for his own job at the
Thus, we conclude Mr. Balatgek's Statement supports plaintiffs'
contention in the Complaint that defendant Balatgek was acting in the
course of his duties for the hospital at the direction of Mr. Olree.
Because Plaintiffs' Complaint alleges activity of all the individual
defendants involved acting in an official capacity on behalf of RHMC, we
conclude that absent an allegation of conduct outside of their corporate
roles, Tyler, supra, and absent a third party co-conspirator, plaintiffs
fail to set forth a claim for civil conspiracy.
Accordingly, we grant defendants' motion to dismiss Counts X, XI and
XII of Plaintiffs' Complaint.
Counts XIV,*fn12 XV*fn13 and XVI*fn14 of Plaintiffs' Complaint
all aver causes of action sounding in negligent supervision. Defendants
argue that these three claims should be dismissed because they are
preempted by the Pennsylvania Workmen's Compensation Act.*fn15 We agree.
That Act provides, in pertinent part, that "the liability of an
employer under this act shall be exclusive and in place of any other
liability to such employees . . . in any action at law or otherwise on
account of any injury or death defined in [§ 411] or occupational
disease in [§ 27.1]."
The Act provides a single narrow exception to preemption, known as the
personal animus exception, for "employee injuries caused by the
intentional conduct of third parties for reasons personal to the
tortfeasor and not directed against him as an employee or because of his
employment." Durham Life Insurance Company v. Evans, 166 F.3d 139, 160
(3d Cir. 1999).
Plaintiffs aver two theories why the Workmen's Compensation Act does
not bar their claims for negligent supervision against RHMC. First,
plaintiffs contend that defendants are precluded from raising the
Workmen's Compensation Act defense because defendants removed this action
to federal court. Specifically, plaintiffs rely on the language of
28 U.S.C. _ 1445 which provides: "A civil
action in any State court arising under the workmens' compensation
laws of such state may not be removed to any district court of the United
States." 28 U.S.C. _ 1445(c).
Second, relying upon the decision of the Supreme Court of Pennsylvania
in Martin v. Lancaster Battery Company,
530 Pa. 11, 606 A.2d 444 (1992), plaintiffs assert that the Workmen's
Compensation Act is not the exclusive remedy where fraudulent
misrepresentation occurs. For the following reasons, we agree with
defendants, disagree with plaintiffs, and grant defendants' motion to
dismiss Counts XIV, XV and XVI of Plaintiffs' Complaint.
Initially, we find unpersuasive plaintiffs' reliance on the language of
28 U.S.C. _ 1445(c). That statutory section is designed to preclude
removal of actions which "arise under" a state's workmen's compensation
laws. Plaintiffs' claims for negligent supervision do not "arise under"
the Pennsylvania Workmen's Compensation Act. Rather, they are negligence
claims (which may be precluded by the exclusivity provisions of the
Workmen's Compensation Act). Because we conclude plaintiffs' negligent
supervision claims are precluded by the exclusivity provisions of the
Act, plaintiffs would not have been able to maintain these negligence
claims in Pennsylvania state court, where they were
originally filed, because they must be brought, if at all, as a workmen's
Accordingly, we conclude that defendants did not remove an action
"arising under" a state's workmen's compensation law.
Next, we find unpersuasive plaintiffs' contention that the Workmen's
Compensation Act does not bar their negligent supervision claims because
a fraudulent misrepresentation has occurred. Specifically, plaintiffs
contend that defendants fraudulently misrepresented the confidentiality
of communications made during the January 22, 2002 meeting. Plaintiffs
reliance on Martin in support of this theory is misplaced.
In Martin the Supreme Court of Pennsylvania held that where the
employer fraudulently misrepresented a safety condition which resulted in
the aggravation of a pre-existing work-related injury, the suit was not
barred by the exclusivity provision of the Workmen's Compensation Act.
There, defendant manufactured automotive and truck wet storage
batteries. The manufacturing process involved extensive employee exposure
to lead dust and fumes that required employees to be regularly tested
pursuant to federal safety regulations for lead content in their blood.
Plaintiff, in Martin, along with other employees, had his blood tested
regularly. However, one of the defendants intentionally withheld, and
altered test results which would have alerted plaintiff to a heightened
level of lead in his blood. Plaintiff was eventually diagnosed with lead
toxicity, lead neuropathy and other ailments which would have been
substantially reduced if his employer had not perpetrated the fraudulent
The Pennsylvania Supreme Court distinguished Martin as an exception to
the general rule enunciated in Poyser v. Newman & Co., 514 Pa. 32,
522 A.2d 548 (1987) (that an employee's claim against his employer for a
work-related injury caused by an employer's fraudulent misrepresentation
is barred by the exclusivity provision of the Workmen's Compensation
We conclude that the fraudulent misrepresentations alleged by
plaintiffs in the case before this court (that plaintiffs' communications
would be kept confidential) are more closely related to the general rule
than to the rare exception enunciated in Martin. We conclude this is
because plaintiffs here do not allege, as alleged in Martin, that
defendants withheld and distorted information which substantially
threatened plaintiffs' health, when advising
plaintiffs of the truth may have saved them from serious health problems.
Because we have concluded that any alleged misrepresentation in this case
does not overcome the exclusivity bar of the Act, plaintiffs' negligent
supervision claims are barred by the Act.
Finally, after reviewing the Complaint, we conclude that none of
plaintiffs' allegations involve the personal animus of any defendant which
would invoke that exception to the exclusivity provision of the Act.
There is nothing in the Complaint which suggests that defendants tape
recorded plaintiffs' conversations for reasons of personal animosity
unrelated to work. Rather, it appears that the conduct complained of
related to defendants seeking information for business reasons.
Therefore, the personal animus exception does not apply.
Accordingly, we grant defendants' motion to dismiss Counts XIV, XV and
XVI of Plaintiffs' Complaint.
Count XVII of Plaintiffs' Complaint asserts a cause of action for
respondeat superior liability. Defendants contend that there is no such
cause of action. Defendants assert that respondeat superior liability is
inferred from a Complaint based on certain alleged facts, but it is not a
separate cause of action.
Plaintiffs assert that in Willinger v. Mercy Catholic Medical Center,
241 Pa. Super. 456, 362 A.2d 280 (1976) the Superior Court of
Pennsylvania stated that there is a separate cause of action for
vicarious liability under the doctrine of respondeat superior. For the
following reasons, we agree with plaintiffs in part; we agree with
defendants in part; and we grant defendants' motion to dismiss Count
XVII. However, we determine that plaintiffs have sufficiently pled a
theory of liability (as opposed to a separate cause of action) concerning
Counts VI, VII, VIII and IX*fn16 based upon the doctrine of respondeat
Count XVII of Plaintiffs' Complaint attempts to assert a separate cause
of action for "respondeat superior". However, "[r]espondeat superior
merely connotes a doctrine of imputation once an underlying theory of
liability has been established. It is not a separate cause of action."
Simcox v. National Rolling Mills, Inc., No. Civ.A. 90-1295, 1990 U.S.
Dist. LEXIS 6757 at *7 (E.D. Pa. June 4, 1990).
Plaintiffs reliance on the decision of the Superior Court of
Pennsylvania in Willinger is misplaced. In Willinger defendant hospital
attempted to amend its third-party complaint against an additional
defendant doctor to allege
that a nurse-anesthetist was the additional defendant's employee in order
to render the additional defendant doctor liable for the negligence of
the nurse-anesthetist. The trial court in Willinger refused to allow the
amendment. In affirming the result, the Superior Court of Pennsylvania
stated: "There can be little dispute that vicarious liability as an
employer and liability for personal negligence are separate causes of
actions, and as such, would require significantly different trial
preparation." 241 Pa. Super. at 466, 362 A.2d at 285.
We agree that to permit an amendment of a cause of action at trial in
order to allow an additional theory of liability, namely vicarious
liability of an employer under the doctrine of respondeat superior,
should not normally be permitted because it would require significantly
different trial preparation. However, we do not read the decision in
Willinger as adopting a new "cause of action" of respondeat superior.
Rather, we conclude that respondeat superior remains what it has always
been: a means of imputing liability to an employer for the actions of its
agents, servants, or employees.
Accordingly, we grant in part and deny in part defendants' motion to
dismiss Count XVII. We grant
defendants' motion and dismiss Count XVII because Count XVII
inappropriately attempts to allege a separate and distinct cause of
action for respondeat superior. However, for the reasons expressed
above, we will treat Count XVII as a request to amend Counts VI, VII,
VIII and IX to allege that defendant RHMC is liable to plaintiffs for the
Wiretap Act and Title III violations alleged in those counts, based upon
the alleged acts of RHMC's employees, under the theory of respondeat
superior. In other words we engraft the allegation of vicarious liability
of defendant RHMC from Count XVII into the counts of Plaintiffs'
Complaint which remain but do not specifically name RHMC as a defendant.
To that extent, we deny defendants' motion to dismiss Count XVII.
Furthermore, while we are not bound by the decisions of the
Pennsylvania intermediate appellate courts, in the absence of clear
precedent from the Supreme Court of Pennsylvania, we should not disregard
the decisions of those intermediate appellate courts unless we are
convinced that the highest court of a state would rule otherwise.
Nationwide Mutual Insurance Company v. Buffetta, 230 F.3d 634, 637 (3d.
Cir. 2000). In this case, for the foregoing reasons, we predict that, if
presented with the question, the Supreme Court of Pennsylvania would
conclude that respondeat superior
does not constitute a separate cause of action. Rather, we predict
that the Pennsylvania Supreme Court would conclude, as we have, that
respondeat superior is a doctrine of imputation once an underlying theory
of liability has been established, and not a separate cause of action.
For all the foregoing reasons, we grant in part and deny in part
defendants' motion to dismiss. Accordingly, we dismiss Counts X, XI, XII,
XIV, XV, XVI, XVII and that portion of Count XIII which alleges an
invasion of privacy based upon the January 22, 2002 incident contained in
Plaintiffs' Complaint. In all other respects defendants' motion to
dismiss is denied.