Beaulac, et al. v. All Systems Satellite Distr., et al.

2017 DNH 227

• Court: District Court, D. New Hampshire
• Decided: October 19, 2017
• Docket: 17-cv-162-LM
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NEW HAMPSHIRE

Deborah Beaulac and Nicholas Beattie

v. Civil No. 17-cv-162-JD Opinion No. 2017 DNH 227 All Systems Satellite Distributors, Inc., et al.

O R D E R

Deborah Beaulac and Nicholas Beattie brought suit against

their former employers: All Systems Satellite Distributors,

Inc.1; Richard Logiudice, an owner and officer of All Systems;

and Gene’s Electronics, Inc. Beaulac and Beattie allege claims

against All Systems, Logiudice, and Gene’s that arose from

events that occurred after Beaulac left All Systems and Gene’s

hired and then fired Beaulac and Beattie. Gene’s moves to

dismiss the claims brought against it.

Standard of Review

In considering a motion to dismiss, the court accepts all

well-pleaded facts as true, disregarding mere legal conclusions,

and resolves reasonable inferences in the plaintiff’s favor.

Galvin v. U.S. Bank, N.A., 852 F.3d 146, 155 (1st Cir. 2017).

Taken in that light, the complaint must state sufficient facts

1 All Systems identifies itself both as “All Systems” and “All System’s.” It appears that All Systems is the correct spelling. to support a plausible claim for relief. In re Curran, 855 F.3d

19, 25 (1st Cir. 2017). The plausibility standard is satisfied

if the factual allegations in the complaint “are sufficient to

support the reasonable inference that the defendant is liable.”

In re Fidelity ERISA Float Litig., 829 F.3d 55, 59 (1st Cir.

2016) (internal quotation marks omitted). The complaint need

not include “a high degree of factual specificity” but “must

contain more than a rote recital of the elements of a cause of

action.” Carcia-Catalan v. United States, 734 F.3d 100, 103

(1st Cir. 2013) (internal quotation marks omitted).

As in their objection to the motion to dismiss filed by

Logiudice and All Systems, Beaulac and Beattie fault Gene’s for

moving to dismiss before discovery has begun. The court

explained in the prior order that Beaulac and Beattie, who are

represented by counsel, misunderstand the purpose of a motion

under Rule 12(b)(6). Gene’s has not violated any procedural

rule by moving to dismiss.

Background

Beaulac worked at All Systems beginning in 2006 and was

promoted to the position of director of sales in New York and

New England in 2008. Her job involved selling satellite

television services. Logiudice was the principal owner and

chief executive officer of All Systems.

2 In 2012, Logiudice imposed new conditions on Beaulac that

she found onerous. Beaulac believed that the new conditions

were intended to force her to leave All Systems. Beaulac

resigned, which was effective October 14, 2016.

Soon after her resignation, Beaulac received job offers

from Gene’s Electronics and Perfect 10, another satellite

distribution company. Beaulac negotiated with the principals of

Gene’s, Stephanie and Darnell Oliver, explaining that she needed

a guarantee of employment for at least six months and wanted a

job offer for her fiancé, Beattie. Gene’s offered Beaulac and

Beattie jobs in a letter dated October 26, 2016, and they

accepted.

In the letter, Gene’s explained the salary offered, the

computation of commissions, Beaulac’s and Beattie’s

responsibilities in the job, and how their expenses would be

handled. As part of the description of their commissions, the

letter stated: “Gene’s Electronics will provide a $5000 sign-on

bonus with the agreement that they both will work full time for

a minimum of 6 months.”

In late November of 2016, the Olivers told Beaulac and

Beattie that Logiudice had threatened to stop doing business

with Gene’s unless they terminated Beaulac’s employment. The

Olivers proposed that they would change the employment

relationship to an independent contractor relationship. The

3 next day, however, the Olivers said that they could not offer

the independent contractor positions because of a conflict with

All Systems. Gene’s then terminated Beaulac and Beattie.

All three defendants moved to dismiss the claims brought by

Beaulac and Beattie. In response, Beaulac and Beattie filed

objections and also filed an amended complaint. As a result,

the motions to dismiss the original complaint were dismissed

without prejudice. Gene’s now moves to dismiss the claims

alleged against it in the amended complaint.2

Discussion

In their amended complaint, Beaulac and Beattie bring

claims against Gene’s for promissory estoppel, Count II; breach

of contract, Count III, and violation of the New Hampshire

Consumer Protection Act, RSA Chapter 358-A, Count V. Gene’s

moves to dismiss all claims against it. Beaulac and Beattie

object, contending that they have adequately alleged their

claims against Gene’s.

A. Promissory Estoppel

In support of their promissory estoppel claim, Beaulac and

Beattie allege that Gene’s promised to employ them for at least

The court previously granted in part and denied in part the 2

motion to dismiss the amended complaint filed by Logiudice and All Systems.

4 six months. They allege that based on that promise they

accepted the offer from Gene’s and rejected an offer from

another prospective employer. Gene’s contends that Beaulac and

Beattie cannot bring a claim for promissory estoppel because

there is a written employment agreement.

Promissory estoppel is a doctrine used “to enforce promises

when consideration is lacking, . . . to enforce promises

underlying otherwise defective contracts and promises made

during the course of preliminary negotiations.” Great Lakes

Aircraft Co., Inc. v. City of Claremont, 135 N.H. 270, 290

(1992). The doctrine “serves to impute contractual stature

based upon an underlying promise, and to provide a remedy to the

party who detrimentally relies on the promise.” Id. “[I]n all

instances, application of promissory estoppel is appropriate

only in the absence of an express agreement.” Id.

Gene’s contends that the employment letter is an express

agreement for at-will employment, which precludes the promissory

estoppel claim. Beaulac and Beattie assert that they have

alleged sufficient facts to support a claim of promissory

estoppel and that the employment agreement does not allow Gene’s

to violate the promise of six months of employment. Beaulac and

Beattie rely on Panto v. Moore’s Business Forms, 130 N.H. 730

(1988), to show that their promissory estoppel claim is not

barred by the employment agreement.

5 In Panto, the defendant hired the plaintiff as an at-will

employee. Id. at 732. Eleven years later, facing the need to

reduce its workforce, the defendant issued a written policy

statement to employees, including the plaintiff, which was

titled “Layoffs and Returns” and provided certain benefits. Id.

When the defendant then reorganized the plaintiff’s department,

the plaintiff decided not to accept the revised position and

resigned. Id. He claimed to have been laid off and to be

entitled to the deferred compensation benefits provided in the

“Layoffs and Returns” policy statement. Id.

After making some preliminary findings, the court

considered “whether the defendant’s statement of terms of

employment, unilaterally promulgated to someone who is already

an at-will employee, is or can become enforceable by the

employee.” Id. at 734. The court found that the circumstances

supported a unilateral contract. Id. at 735. The policy

statement was deemed to be an offer that was subject to

acceptance by the employee through continued performance of his

duties, which then formed an enforceable contract. Id. The

court did not consider a promissory estoppel theory. Id. at 738

(“Because we do not understand Panto’s pleadings to raise an

estoppel claim, we will say no more here about this theory of

enforcement.”).

6 Beaulac and Beattie attempt to use Panto to support their

promissory estoppel theory even though Panto addressed a

different issue, modification of an at-will employment

relationship through a subsequent unilateral contract, rather

than promissory estoppel. The facts and holding in Panto do not

support the promissory estoppel claim raised here. Beaulac and

Beattie accepted Gene’s written employment offer in the letter,

and there are no allegations of a later unilateral offer of

different terms, which is what occurred in Panto.

Therefore, because Beaulac’s and Beattie’s employment is

governed by a written agreement, the promissory estoppel claim

is dismissed.

B. Breach of Contract

Beaulac and Beattie allege that Gene’s breached the

employment agreement by firing them before they had worked for

six months. Gene’s moves to dismiss the claim on the grounds

that the agreement did not include a term for the duration of

their employment, making Beaulac and Beattie at-will employees

who could be terminated at any time. Beaulac and Beattie argue

that the letter was not a complete integration of their

agreement and that the letter agreement provides for employment

for at least six months.

7 The meaning of a written contract is a question of law for

the court. Holloway Auto. Gr. v. Giacalone, 169 N.H. 623, 628

(2017). “When interpreting a written agreement, [the court

gives] the language used by the parties its reasonable meaning,

reading the document as a whole, and considering the

circumstances and the context in which the agreement was

negotiated.” Id. When an issue arises as to whether a writing

expresses the parties’ complete agreement, the court must first

decide whether the writing is a total integration of the

agreement. Behrens v. S.P. Constr. Co., Inc., 153 N.H. 498, 504

(2006); MacLeod v. Chalet Susse Int’l, Inc., 119 N.H. 238, 242-

43 (1979).

“Employment at will refers to an employment contract that

is for an indefinite period of time and is terminable at will.”

J & M Lumber & Constr. Co., Inc. v. Smyjunas, 161 N.H. 714, 725

(2011). “The prevailing rule in New Hampshire is that, absent

an agreement to the contrary, employment contracts are ‘at-

will’, meaning that both parties are free at any time to

terminate the employment relationship, with or without cause.”

Leeds v. BAE Sys., 165 N.H. 376, 379 (2013).

The letter agreement does not include an express duration

for employment or a provision that Beaulac and Beattie were at-

will employees. The agreement also lacks an integration clause.

8 Therefore, it does not expressly address the issues raised for

breach of contract.

Although the letter agreement required Beaulac and Beattie

to work for at least six months in exchange for the sign-on

bonus, it does not include a reciprocal provision requiring

Gene’s to employ Beaulac and Beattie for six months, or for any

specific amount of time. Ordinarily, that omission would result

in an at-will employment relationship.

Beaulac and Beattie allege in the amended complaint,

however, that Beaulac explained to the Olivers before they

accepted the jobs at Gene’s that “there had to be a guarantee of

employment for at least 6 months.” They also allege that

“Gene’s agreed that it would employ Ms. Beaulac and Mr. Beattie

for at least 6 months.”

Based on the circumstances alleged in the amended

complaint, along with the references to six months in the letter

agreement, the parties may have intended the six-month

employment commitment to be reciprocal. That is, the parties

may have intended that Beaulac and Beattie would promise to work

for six months and Gene’s would promise to employ them for six

months. If the agreement were interpreted to include a six-

month term of employment, Beaulac and Beattie would not have

been at-will employees, and Gene’s would have breached the

9 employment agreement by firing them less than six months after

they started work.

Therefore, the breach of contract claim based on a term of

employment should be addressed, if appropriate, in the more

factually developed context of a motion for summary judgment.

C. Implied Covenant of Good Faith and Fair Dealing

As part of their breach of contract claim, Beattie and

Beaulac allege that Gene’s breached the implied covenant of good

faith and fair dealing. Beaulac and Beattie allege only that

“Gene’s had an obligation of good faith and fair dealing with

respect to the contract it had with [them]” and that “Gene’s

violated its contractual obligations.” Gene’s contends that

those allegations are insufficient to state a claim of breach of

the implied covenant.

All contracts include an implied covenant of good faith and

fair dealing. J & M Lumber, 161 N.H. at 725; see also Porter v.

City of Manchester, 151 N.H. 30, 38-39 (2004) (distinguishing

between contract and tort actions). The three categories of the

implied covenant address separate contractual functions: “(1)

contract formation; (2) termination of at-will employment

agreements; and (3) limitation of discretion in contractual

performance.” J & M Lumber, 161 N.H. at 724. The covenant to

act in good faith in terminating at-will employment agreements

10 is violated “‘by firing an employee out of malice or bad faith

in retaliation for action taken or refused by the employee in

consonance with public policy.’” Harper v. Healthsource N.H.,

Inc., 140 N.H. 770, 776 (1996) (quoting Centronics Corp. v.

Genicom Corp., 132 N.H. 133, 140 (1989)).

Gene’s moves to dismiss the claim on the ground that

Beaulac and Beattie have not alleged a violation of public

policy. Beaulac and Beattie do not address that omission.

As alleged in the amended complaint, Gene’s fired Beaulac

and Beattie because Logiudice of All Systems threatened to stop

doing business with Gene’s. Beaulac and Beattie do not allege

that they were fired in retaliation for any action they took or

refused to take in consonance with public policy. As a result,

Beaulac and Beattie have not stated a claim that Gene’s breached

the implied covenant of good faith and fair dealing that applies

to termination of at-will employment agreements. See, e.g.,

Kertanis v. Georgia-Pacific Gypsum, LLC, 2016 WL 3033706, at *6

(D.N.H. May 26, 2016); Isaacs v. Dartmouth-Hitchcock Med. Ctr.,

2014 WL 1572559, at *15 (D.N.H. Apr. 18, 2014).

In their surreply, however, Beaulac and Beattie raise for

the first time the third category of the implied covenant, which

imposes a limitation on the discretion used in contractual

performance. As alleged, however, the claim in this case

involves termination of employment in breach of the agreement,

11 not contractual performance. Beaulac and Beattie have not shown

that the third category of the implied duty would apply in the

circumstances of this case.

Therefore, that part of the breach of contract claim in

Count III that is based on the covenant of good faith and fair

dealing is dismissed.

D. New Hampshire Consumer Protection Act – RSA Chapter 358-A

Count V is titled: “UNFAIR BUSINESS PRACTICES (New

Hampshire RSA 358-A) All defendants.” Despite designating all

defendants, Beaulac and Beattie allege only that the conduct of

All Systems and Logiudice was unfair and deceptive and do not

mention Gene’s. Therefore, they do not allege a claim that

Gene’s violated RSA Chapter 358-A.

Beaulac’s and Beattie’s claim arises out of their employment

relationship with Gene’s. To the extent Beaulac and Beattie may

have intended to bring a claim against Gene’s in Count V, they

have not stated a viable cause of action. Claims arising from

employment disputes are not actionable under RSA Chapter 358-A.

See Gately v. Mortara Instrument, Inc., 2017 WL 3431964, at *7

(D.N.H. Aug. 9, 2017); Donovan v. Digital Equip. Corp., 883 F.

Supp. 775, 787 (D.N.H. 1994). Beaulac’s and Beattie’s efforts

to describe their dispute with Gene’s as something other than an

12 employment dispute and their reliance on Professional Staffing

Gr. v. Champigny, 2004 WL 3120093 (Mass. Super. Nov. 18, 2004),

are not persuasive in the context of this case.

Conclusion

For the foregoing reasons, Gene’s motion to dismiss

(document no. 24) is granted as to Count II, Count V, and that

part of Count III that is based on the implied covenant of good

faith and fair dealing.

The claims remaining in the case are Count I against All

Systems and Logiudice, Count III limited to the claim that

Gene’s breached the employment agreement by firing Beaulac and

Beattie without cause before they had worked there for six

months, Count IV against All Systems and Logiudice, and Count V

against All Systems and Logiudice.

SO ORDERED.

__________________________ Joseph DiClerico, Jr. United States District Judge

October 19, 2017

cc: Brian L. Champion, Esq. Talesha L. Saint-Mar, Esq. David P. Slawsky, Esq. Tyler Smith, Esq.