The opinion of the court was delivered by: Robert L. Carter, District Judge.
Plaintiffs in this employment discrimination case make claims
under the Age Discrimination in Employment Act ("ADEA"),
29 U.S.C. § 623, and the New York Human Rights Law, N.Y.Exec.Law §
296(1)(a) (McKinney 1982), as well as claims for breach of
contract and tortious interference with business relations.
Plaintiff Bernard H. Frishberg ("Frishberg") is president and
sole shareholder of plaintiff Dee Bee Sales Corporation ("Dee
Bee Sales"), which employed Frishberg and several other people
as sales representatives marketing merchandise for defendant
Esprit de Corp. ("Esprit"). Jurisdiction is based both on the
presence of a federal question and diversity of citizenship of
the parties.*fn1 Defendant Esprit has moved for summary
judgment on all of plaintiffs' claims.
The undisputed facts relevant to the present motion are as
follows. In 1978, Frishberg met with Leon C. Rosenberg
("Rosenberg"), national sales manager for Esprit, to discuss
selling Esprit merchandise. Their eventual agreement that
Frishberg would sell women's wear for Esprit as a commissioned
salesperson was memorialized in a letter from Rosenberg to
Frishberg, dated October 9, 1978. Esprit claims that this
letter embodied the entirety of the agreement between the
parties, while Frishberg maintains that his agreement with
Rosenberg, and therefore with Esprit, was partly written and
The letter agreement stated the terms of Frishberg's
engagement as follows: his sales territory included all of New
Jersey, Long Island, upstate New York, and the New York
metropolitan region, less certain accounts; his remuneration
would be a commission of eight percent (8%) of net shippings;
he was to sell only Esprit merchandise; and he was to hire two
salespeople to work for him in selling Esprit products.
Initially, Frishberg was paid directly by Esprit, as were the
two salespeople he hired to work with him. During this period
Esprit deducted payroll taxes from the commissions it paid to
Frishberg. However, in 1981 Frishberg formed Dee Bee Sales, a
New York corporation of which he was sole shareholder and
through which he sold Esprit goods. From that date forward,
Frishberg and the salespeople he hired were paid by Dee Bee
Sales, which deducted payroll taxes on their behalf, and Esprit
paid commissions on the merchandise sold by all these people
directly to Dee Bee Sales.
Frishberg d/b/a Dee Bee Sales employed several salespeople
and assistants from 1981 to 1989, including two that covered
the upstate New York sales territory for Dee Bee Sales. Esprit
provided these salespeople with drawing accounts, but only on
the condition that Frishberg d/b/a Dee Bee Sales guarantee
them. On at least one occasion, Frishberg had to pay Esprit
$5,000 to cover the overdrafts of a Dee Bee Sales salesperson.
Frishberg d/b/a Dee Bee Sales kept two offices, one in the
basement of Frishberg's house in East Meadow, New York, and the
other a condominium showroom in Atlantic City, New Jersey.
Frishberg purchased and maintained these two offices at his own
expense. Frishberg d/b/a Dee Bee Sales also paid a fee to
Esprit for the use of an Esprit showroom in New York City.
Frishberg d/b/a Dee Bee Sales paid many of its own business
expenses, including rental space for displaying merchandise,
automobile expenses, hotel rooms, telephone bills, and other
travel costs. Esprit, however, paid all expenses when Frishberg
and the salespeople employed by Dee Bee Sales attended
quarterly Esprit sales meetings. Frishberg and the employees of
Dee Bee Sales received no traditional employee benefits from
Esprit. Dee Bee Sales paid for Frishberg's pension plan,
medical expenses, disability insurance, life insurance, and
vacations.*fn2 Frishberg also worked largely on his own,
without daily supervision by Esprit. Frishberg set his own
schedules and appointments with clients. He did, however,
report at least weekly to Esprit officials regarding the sales
Dee Bee Sales had produced in his territory.
Beginning in 1983, Esprit reduced the commission rate
applicable to commissioned sales representatives several times.
That year the rate was reduced from 8% to 6%, in 1984 it was
reduced to 5%, and then in 1988 it was further reduced to 4%.
These commission reductions all affected Frishberg and Dee Bee
Sales. In 1988, Esprit also moved the United States Navy
account, a large account that had been very profitable for
Frishberg, from Dee Bee Sales to the Esprit regional office in
New York. Throughout this period Frishberg and Dee Bee Sales
continued their relationship with Esprit.
In 1989, Esprit management continued the change in its sales
approach. It pulled "in-house," i.e. into the closest regional
sales office, most of the remaining major store accounts that
were still being sold to by commissioned sales representatives.
In accordance with this plan, Richard Baker ("Baker"),
president of Esprit's women's wear division, called Frishberg
on October 27, 1989, to inform him that the Stern's account, to
which Frishberg had been selling and which constituted a large
part of his business, was being reassigned to the regional
office in New York.
A letter to Frishberg dated October 31, 1989, explained the
restructuring and confirmed the removal of the Stern's account.
The letter did not terminate Frishberg, but expressed Esprit's
wish "to help you refocus your attention on the many other
accounts and potential customers in your area. . . ." Baker
sent another letter to Frishberg on December 4, 1989, once
again confirming the restructuring and the removal of Stern's
from his charge. In a letter dated December 6, 1989, Frishberg
requested that airline tickets for the upcoming national sales
meeting in Phoenix be forwarded to him, in accordance with past
practice. No tickets were sent, and Frishberg did not attend
the sales meeting. Various negotiations and this lawsuit
Esprit has moved for summary judgment on all of plaintiffs'
claims. To prevail on such a motion, the moving party must
establish that "there is no genuine issue as to any material
fact and that [it] is entitled to judgment as a matter of law."
Rule 56(c), F.R.Civ.P. The court is not to "determine the truth
of the matter but to determine whether there is a genuine
[factual] issue" which must be reserved for trial. Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 249-50, 106 S.Ct. 2505,
2510-11, 91 L.Ed.2d 202 (1986). All evidence submitted must be
viewed in a light most favorable to the party opposing the
motion, Matsushita Elec. Industrial Co. v. Zenith Radio Corp.,
475 U.S. 574, 587, 106 S.Ct. 1348, 1356, 89 L.Ed.2d 538 (1986),
and the court must resolve all doubts, ambiguities and
inferences in the non-movant's favor. United States v. Diebold,
Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176
The summary judgment hurdle is not insurmountable, however.
The Supreme Court has noted that "[i]f the evidence [submitted
by the party opposing summary judgment] is merely colorable .
. . or is not significantly probative . . . summary judgment
may be granted." Liberty Lobby, supra, 477 U.S. at 249-50, 106
S.Ct. at 2510-11. The Court has explained that "[o]ne of the
principal purposes of the summary judgment rule is to isolate
and dispose of factually unsupported claims or defenses, and we
think it should be interpreted in a way that allows it to
its purpose." Celotex Corp. v. Catrett, 477 U.S. 317, 323-24,
106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). Thus, once the
movant has pointed out to the court the absence of a fact
issue, the "opponent must do more than simply show that there
is some metaphysical doubt as to ...