United States District Court, S.D. New York
March 18, 2004.
STEVEN A. ENNIS, Plaintiff, -against- TYCO INTERNATIONAL LTD., SONITROL MANAGEMENT CORPORATION, and MID-ATLANTIC SECURITY, INC., Defendants
The opinion of the court was delivered by: THOMAS GRIESA, Senior District Judge
This is an action by plaintiff Steven A. Ennis against his former
employer alleging discrimination on the basis of age and religion, and
retaliatory termination, in violation of Title VII of the Civil Rights
Act of 1964, 42 U.S.C. § 2000e, et seq., the Age Discrimination in
Employment Act, 29 U.S.C. § 621, et seq., and state and city civil rights
laws. There are three defendants: Tyco International Ltd., Sonitrol
Management Corporation, and Mid-Atlantic Security, Inc.
Now before the Court is a motion by Tyco. to dismiss the complaint for
failure to state a cause of action against Tyco. Tyco's position is that
it was not Ennis's employer, and that its personnel had nothing to do
with the alleged wrongdoing. It is conceded for purposes of this motion
that Sonitrol and Mid-Atlantic are closely enough related for both to be
considered employers of Ennis.
For the reasons set forth below, the motion is granted.
In the course of briefing on this motion to dismiss, the parties
submitted, and had the opportunity to respond to, matters outside the
pleadings. Because these matters were not excluded by the Court, the
motion shall be treated as one for summary judgment. Fed.R.Civ.P.
12(b). Therefore, the facts are taken from the pleadings and the
affidavits submitted on the motion.
Ennis is a 57-year-old man of the Jewish faith. The complaint states
that Ennis began working for Sonitrol, a provider of security products,
on March 8, 1990, and was terminated from Sonitrol's employment on
January 29, 2002. Although it is not entirely clear, it appears from the
complaint that Ennis was employed at Sonitrol's New York City office,
located in Manhattan.
The complaint states that on September 5, 2001 Sonitrol hired Jim
Wright as General Manager for the Metro New York area, which included the
New York and New Jersey offices. Wright mainly worked out of the New
Jersey office. Wright was reportedly a minister, and was referred to as
The complaint alleges that over the course of the approximately
eighteen months between Wright's arrival and Ennis's termination,
numerous events occurred to create a hosfile work environment. In about
October of 2001 the first of these
events occurred, when Wright allegedly left two voice messages for
Ennis "screaming that he had an attitude problem" after Ennis accidently
hung up on Wright during a cell phone conversation. The complaint alleges
that when Ennis relayed this incident to a co-worker, the co-worker
stated, "Jim hates Jews."
The complaint alleges that, over time, Wright created a "cult-like
working environment" by hiring young "followers from his church," who
were unqualified for their positions at Sonitrol and lived with Wright in
his home in New Jersey. Wright and the young employees allegedly made
various displays of religion in Ennis's presence, including praying and
singing hymns. Wright is also alleged to have made derogatory remarks
about Jewish holidays.
The complaint alleges that Ennis communicated with Sonitrol management
regarding his problems with Wright on November 11, 2001. On this date
Ennis wrote to John Rausch, Director of Sales for Sonitrol, informing him
that a telephone conversation between Ennis and Wright had occurred, in
which Wright had verbally abused Ennis. Ennis stated in the letter that
he found the behavior intolerable and desired some action on the part of
The complaint further alleges that on January 15, 2002 Ennis wrote to
Phil Adams, Director of Human Resources at Sonitrol, stating that Ennis
felt that Wright was discriminating against
him because Ennis was Jewish. The letter also stated that Wright
had hired primarily young workers and had displayed hostility toward
older workers, and that this constituted age discrimination. According to
the complaint, on January 17 Ennis made a follow-up phone call to Rausch
and informed him of the complaint Ennis had sent to Adams. Ennis also
told Rausch in that conversation that Wright "had a problem with" Ennis
because Ennis was Jewish.
Ennis was absent from work between January 21 and January 28, 2002 due
to the death of his mother. The complaint alleges that on January 29
Ennis discovered that his cell phone had been disconnected by Sonitrol.
When Ennis arrived at his office that day, he discovered that Wright, a
co-worker, and a locksmith had entered the office, removed the
documents, and changed the lock on the door. When Ennis was able to enter
his office later that day, he found a letter from Rausch stating,
"Effective immediately, your employment with Sonitrol of Metro New York
is terminated." The letter cited Ennis's ongoing conflict with Wright as
the reason for the termination.
The complaint states that Tyco, Sonitrol, and Mid-Atlantic "are a
single employer, with interrelated corporations, centralized control of
labor relations common management and common ownership." The complaint
also alleges, in each of its five counts, that "each of the defendants
was an `employer'"
within the meaning of the relevant statute. These statements are
the only allegations that the complaint makes with specific reference to
Tyco. or Mid-Atlantic.
Both Tyco. and Ennis have submitted employee manuals allegedly received
by Ennis. Tyco. submitted a manual titled "Employee's Policy Guide and
Benefits Program," bearing the name of Sonitrol and Mid-Atlantic
Security, Inc. The first page of the manual indicates that it is provided
to all new and existing employees of Mid-Atlantic Security, Inc.,
Sonitrol of Atlanta, Sonitrol of Baltimore, and Sonitrol of New York,
Ennis submitted an employee manual published by Tyco, titled, "Standards
of Conduct." According to a form dated April 9, 2001, Ennis received the
Tyco. manual and agreed to abide by the standards "as a condition of my
employment and continued employment at Tyco." The form also stated that
if Ennis had questions regarding the standards, he should consult with
his immediate supervisor, local human resources representative, the
general manager of his unit, or any other member of senior management.
Alternatively, the document stated that Ennis could contact Tyco's
toll-free "ConcerLine," or Tyco's Corporate Human Resources Department or
Ennis has submitted an affidavit stating that during his employment he
considered himself to be a Tyco. employee, that he was covered by a Tyco
medical plan and Tyco. 401(k) plan, and that
he participated in a Tyco. stock purchase plan, all administered by
Tyco's human resources department in Texas. Ennis's affidavit also states
that his business card denoted that he worked for a Tyco. company, that
during sales pitches for Sonitrol products employees were encouraged to
mention Sonitrol's relationship with Tyco, and that during his employment
he received various Tyco-related publications and promotions.
Ennis has provided two e-mail classified advertisements for employment
at Tyco, and print-outs from Tyco's website, all stating that Tyco
employs more than 200,000 employees worldwide. It is assumed for purposes
of this motion that this number refers to employees of all Tyco
subsidiaries, including Sonitrol and Mid-Atlantic.
Tyco. has submitted the declaration of Wesley L. France, Vice President
and Chief Operating Officer of Sonitrol Management Corporation. France
states that Tyco. International, Ltd. is a Bermuda-based holding company
with fewer than fifteen employees, none of whom resides in the United
States or is engaged in the day-to-day management of Sonitrol. France
also states that Tyco. does not control the labor functions of Sonitrol
and that Ennis was not an employee of Tyco.
Also in the record are submissions from Tyco. of correspondence from
Ennis, Rausch, and Adams on the Sonitrol letterhead. Rausch and Adams
both, in their signature lines,
identify themselves as Mid-Atlantic employees. Also printed on the
stationery, at the bottom of the cover page, is a statement that Sonitrol
is "a Tyco. company." The deposition testimony of Rausch similarly states
that Rausch and Ennis were employees of Mid-Atlantic, a subsidiary of
Sonitrol, which is in turn a subsidiary of Sonitrol, Inc., which is
itself in turn either a subsidiary of or in another way related to ADT
Inc., and that Tyco. was somewhere higher "in the food chain." It should
be noted that Tyco. has not offered a more specific or technical
description of Tyco's precise relationship to Sonitrol or Mid-Atlantic.
Additionally, Tyco. submitted copies of Ennis's 1999, 2000, 2001, and
2002 W-2 forms, which list "Mid-Atlantic Security, Inc." as Ennis's
employer. Finally, a copy of Ennis's resume, also submitted by Tyco,
lists Ennis's employer as "Sonitrol of Metro New York (a subsidiary of
As a general matter, the law treats the employees of a corporate entity
as the employees of a related entity only under extraordinary
circumstances. See Murray v. Miner, 74 F.3d 402, 404 (2d Cir. 1996). The
Second Circuit has enunciated a four-part test for determining when two
entities are sufficiently interrelated for an employee to hold both
liable as a "single employer" under Title VII. There must be evidence of
control of labor relations, interrelation of operations between the two
entities, common management, and common ownership or financial control.
See Cook v. Arrowsmith Shelburne, Inc., 69 F.3d 1235, 1240 (2d Cir.
1995). The most important is the first factor, with the critical question
being what entity made the final decisions regarding employment matters
related to the plaintiff. See id. at 1240; Herman v. Blockbuster
Entertainment Group, 18 F. Supp.2d 304, 309 (S.D.N.Y. 1998).
As to the first factor, it is undisputed that the only individuals
involved in the circumstances leading up to Ennis's termination were
Wright, Rausch, and Adams. Wright is alleged to have been hired by
Sonitrol to serve as General Manager for the New York metro area. Rausch
is identified in the complaint as being Director of Sales for Sonitrol,
and Adams is identified as Director of Human Resources for Sonitrol. No
allegations of wrongdoing have been made by Ennis against Tyco personnel.
Moreover, Ennis was at all times dealing exclusively with management and
human resources personnel from Sonitrol and/or Mid-Atlantic.
Also with regard to the question of centralized control of labor
relations, Ennis alleges that the employee benefit plans in which he
participated were all Tyco-administered. This fact, however, is not
probative of the level of day-to-day control over employment matters
required by single employer doctrine.
Numerous other courts have similarly noted that administration by a
parent of a subsidiary's benefit plans is neither uncommon nor probative
of the employment control factor. See, e.g., Duffy v. Drake Beam Morin,
96 Civ. 5606, 1998 WL 252063, at *5 (S.D.N.Y. May 19, 1998); Kellett v.
Glaxo Enterprises, Inc., 91 Civ. 6237, 1994 WL 669975, at *5 (S.D.N.Y.
Nov. 30, 1994).
It is true that Tyco. had an employee manual and that Ennis signed a
form agreeing to abide by the manual's guidelines as a condition of
employment. However, Mid-Atlantic also issued an employment manual from
its own human resources department. Cf. Darden v. Daimler Chrysler North
America Holding Corp., 191 F. Supp.2d 382, 396 (S.D.N.Y. 2002); Schade v.
Coty, Inc., No. 00 Civ. 1568, 2001 WL 709258 at *8 (S.D.N.Y. Jun. 25,
2001); Herman, 18 F. Supp.2d at 310. The mere fact that Ennis agreed to be
bound by certain standards of conduct set forth by Tyco. does not
indicate that Tyco. exercised control over or made final decisions
regarding the employment of Ennis or anyone else at Sonitrol or
Mid-Atlantic. Moreover, the fact that Tyco advertised itself as an
employer of more than 200,000 people worldwide, presumably including
Sonitrol and Mid-Atlantic employees, does not, in and of itself, show
Tyco's control over the employees of the subsidiary.
With respect to interrelation of operations the second factor
courts consider whether the parent was involved directly
in the subsidiary's daily business decisions; whether the two entities
shared employees, services, records, or equipment; and whether the
entities commingled assets or finances to any extent. Herman, 18 F.
Supp.2d at 309. In this regard Ennis points to the fact that his business
cards and the Sonitrol letterhead indicated that Sonitrol was a Tyco.
company, and the fact that Ennis was encouraged to mention Sonitrol's
Tyco. affiliation in the course of sales pitches. These circumstances do
not demonstrate a significant level of interrelation among Tyco,
Sonitrol, and Mid-Atlantic. There is nothing rising to the level of
control over regular business decisions contemplated by the single
The final two factors are considerations of the degree of common
management and common ownership. These are considered less important in
determining single employer status, owing to the fact that "they
represent ordinary aspects of the parent-subsidiary relationship." Meng,
73 F. Supp.2d at 403. Thus, in the absence of a meaningful showing of
control by the parent over employment decisions of the subsidiary or the
existence of interrelation of operations, a demonstration of common
management or ownership between the two entities will not tip the scale.
See Schade, 2001 WL 709258 at *9. It is true that Sonitrol and
Mid-Atlantic were subsidiaries of Tyco, however attenuated the
relationship may have been. However, there is no evidence that
Tyco. shared common management or, as already described, that there
was any control over or interrelationship with Sonitrol and Mid-Atlantic.
The Court concludes, in light of the evidence presented on the motion
regarding the relevant factors, that Tyco. was not an employer of Ennis.
This has been shown beyond any triable issue of fact.
Treating Tyco's motion to dismiss as one for summary judgment the
motion is granted and the action is dismissed as to Tyco.
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