Seaman v. Arvida Realty Sales, Inc.

910 F. Supp. 581, 1995 U.S. Dist. LEXIS 19587, 1995 WL 775028
CourtDistrict Court, M.D. Florida
DecidedNovember 15, 1995
DocketNo. 89-999-CIV-T-17
StatusPublished

This text of 910 F. Supp. 581 (Seaman v. Arvida Realty Sales, Inc.) is published on Counsel Stack Legal Research, covering District Court, M.D. Florida primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Seaman v. Arvida Realty Sales, Inc., 910 F. Supp. 581, 1995 U.S. Dist. LEXIS 19587, 1995 WL 775028 (M.D. Fla. 1995).

Opinion

ORDER ON MOTION FOR SUMMARY JUDGMENT

KOVACHEVICH, District Judge.

This cause is before the Court on Defendants’ Motion for Summary Judgment, Memorandum in Support thereof (Docket Nos. 86 and 87), and response thereto (Docket No. 99). This ease is here on remand from the Eleventh Circuit Court of Appeals.

STANDARD OF REVIEW

This circuit clearly holds that summary judgment should only be entered when the moving party has sustained its burden of showing the absence of a genuine issue as to any material fact when all the evidence is viewed in the light most favorable to the nonmoving party. Sweat v. Miller Brewing Co., 708 F.2d 655 (11th Cir.1983). All doubt as to the existence of a genuine issue of material fact must be resolved against the moving party. Hayden v. First National Bank of Mt. Pleasant, 595 F.2d 994, 996-7 (5th Cir.1979), quoting Gross v. Southern Railway Co., 414 F.2d 292 (5th Cir.1969). As the district court in Coghlan v. H.J. Heinz Co., 851 F.Supp. 808 (N.D.Tex.1944), so summarized:

“Although a court must ‘review the facts drawing all inferences most favorable to the party opposing the motion,’ ... the nonmovant may not rest on mere allegations or denials in its pleadings; in short, ‘the adverse party’s response ... must set forth specific facts showing that there is a genuine issue for trial.’ FED.R.CIV.P. 56(e). However, merely colorable evidence or evidence not significantly probative will not defeat a properly supported summary [583]*583judgment ... The existence of a mere scintilla of evidence will not suffice ...”
(cites omitted) at 810-811.

The Supreme Court of the United States held, in Celotex Corp. v. Catrett, 477 U.S. 317, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986):

“In our view the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to establish the existence of an element essential to that party’s ease, and on which that party will bear the burden of proof at trial.” Id. [477 U.S. at 332, 106 S.Ct. at 2552, 91 L.Ed.2d] at 273.

The Court also said, “Rule 56(e) therefore requires that nonmoving party to go beyond the pleadings and by her own affidavits, or by the ‘depositions, answers to interrogatories, and admissions on file,’ designate ‘specific facts showing there is a genuine issue for trial.’ ” Celotex Corp., [477 U.S. at 323, 106 S.Ct. at 2553, 91 L.Ed.2d] at 274.

FACTS

The following is a summary of the relevant facts asserted by the Defendant’s Motion for Summary Judgment and not controverted by Plaintiffs response.

1. Defendant, Arvida, is a developer of residential and commercial communities: It purchases tracts of undeveloped land on which it builds and sells properties and develops communities. The Court is using the singular “Defendant Arvida” to refer to all Defendant Arvida entities.

2. Plaintiff, Ms. Seaman, worked at the Defendant’s Sarasota office.

3. Prior to 1989 all of the sales agents were employed as employees. Defendant paid all job-related expenses including the payroll taxes, licensing fees. More importantly, Defendant permitted them to participate in the company sponsored health insurance plans and 401 (k) plan.

4. In 1989, Defendant decided to change all sales agents employed as employees to independent contractors. As independent contractors, the sales agents would be responsible for most of the job-related expenses, including the cost of benefits previously provided by Defendant.

Defendant argues that the eliminating benefits was not the reason for its decision to change its sales agents to independent contractors. Defendant asserts that it was concerned with its inability to compete with the other developers whose sales agents were independent contractors.

Plaintiff argues that the reason for the reclassification was to save the cost of benefits. As such, Plaintiff asserts that Defendant violated Section 510. Section 510 provides that an employer cannot [fire] a participant or beneficiary for exercising a right to which they are entitled to under an employee benefit plan. 29 U.S.C. 1140 (1995).

Plaintiff also asserts a claim under RICO, and two state causes of action.

DISCUSSION

Count I

I. Violation of Section 510 29 U.S.C. 1140 (E.R.I.S.A.)

Defendant argues that the motivating factor for the conversion of its sales staff from employees to independent contractors was to increase revenue and to become competitive with the other real estate developers. Defendant alleges that preventing the sales agents from participating in Arvida’s benefit plans was not a motivating factor in its decision to convert, although loss of benefits was an incidental result.

In addition, Defendant asserts that Arvida was one of the few real estate developers that employed its sales agents as employees. As such, Defendant argues it was operating at a significant disadvantage financially, losing about 500,000-800,000 in revenue at the Boca Raton office. Defendant argues that to increase its revenues, it had to attract high producing sales agents. It is Defendant’s contention that the only way to do this was to offer a compensation package which mirrored the competition.

Furthermore, Defendant alleges that, after a great deal of study, it concluded that to change its sales agents from employees to [584]*584independent contractors was the way to achieve this goal. Defendant argues that this is conclusive evidence that saving benefit costs was not the motivating factor behind the conversion. Defendant argues summary judgment should be granted.

Finally, Defendant asserts that its offer to Seaman to stay on as a manager with full benefits, and her rejection, disproves her contention that Defendant wanted to deprive her of the opportunity to receive employee benefits.

Plaintiff opposes the Motion for Summary Judgment pertaining to Count I. Plaintiff argues that Defendant’s motivation for the conversion of the sales staff from employees to independent contractors was to deprive the sales associates continued participation in Arvida’s insurance programs and in the company-sponsored 401k plans. Plaintiff urges that in-house memoranda prove that benefit costs were the motivating factor.

Plaintiff asserts that competition was not the motivating factor for the conversion. Plaintiff argues that Arvida could have increased commission splits at any time. However, Defendant concedes that the reason why Arvida could not raise commissions in the past was because of the cost of running the business.

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910 F. Supp. 581, 1995 U.S. Dist. LEXIS 19587, 1995 WL 775028, Counsel Stack Legal Research, https://law.counselstack.com/opinion/seaman-v-arvida-realty-sales-inc-flmd-1995.