L'Annuziata and Abilgard Ruling: Motions to amend complaints
CHRO No. 0210153
Fed No. 16aa200012
Commission on Human Rights and Opportunities ex rel. Paul L'Annunziata
CHRO No. 0110495
Fed No. 16aa11326
Commission on Human Rights and Opportunities ex rel.William Abildgaard
New Horizons Computer Learning Center
August 7, 2003
Ruling re: Motions to amend complaints
By motions dated April 2, 2003, the Commission on Human
Rights and Opportunities ("commission") moves to amend the complaints.
At the request of one or more of the parties, continuances were granted to file
responses to the motions. New Horizons Computer Learning Center ("Learning
Center") filed its opposition to the proposed amendments on June 20, 2003.
New Horizons Worldwide, Inc. ("Worldwide") filed its objection on July
8, 2003. An evidentiary hearing was held on July 23, 2003. The transcript
("Tr.") was filed on August 6, 2003.
For the reasons set forth herein, the commission's proposed amendments are found
to be reasonable. The motions are granted and Learning Center's and Worldwide's
("respondents") objections are overruled. The respondents shall file
and serve their answers to the amended complaints on or before August 21, 2003.
With respect to the complaint filed by William Abildgaard ("Abildgaard"),
the commission proposes: to (1) correct Abildaard's address; (2) amend the first
sentence of paragraph 3 to say that on his first day of employment he was asked
his age; (3) amend the first sentence of paragraph 8 to change an interview date
from December of 2000 to the fall of 2000; and (4) add Worldwide as a
With respect to the complaint filed by Paul L'Annunziata ("L'Annunziata"),
the commission proposes to: (1) amend the first sentence of paragraph 7 to
change an interview date from December of 2000 to the fall of 2000; and (2) add
Worldwide as a respondent.
In its amendments to both complaints, the commission proposes to pierce Learning
Center's "corporate veil" in order to hold Worldwide also liable for
Learning Center's allegedly discriminatory termination of the complainants. The
commission further alleges that both Learning Center and Worldwide violated
General Statutes §§ 46a-60(a)(1) and 46a-60(a)(5), and the Age Discrimination
in Employment Act of 1967, as amended, 29 U.S.C. 621 et seq.
General Statutes § 46a-84(g) provides in part that "[t]he presiding
officer … shall permit reasonable amendment to the complaint or answer …."
Further, section 46a-54-79a(e) of the Regulations of Connecticut State Agencies
provides in part that "[t]he presiding officer shall permit reasonable
amendment of any complaint and shall allow the parties and intervenors
sufficient time to prepare their case in light of the amendment." In
determining the reasonableness of the amendment, "[f]actors to be
considered include the timeliness of the application, the possibility of
prejudice to the other party and whether the applicant's presence will enable
the court to make a complete determination of the issues." (Citation
omitted.) A. Secondino and Son, Inc. v. Anthony LoRicco, 19 Conn. App. 8, 14
(1989); Commission on Human Rights and Opportunities ex rel. Maria S. Rountree
v. Seafood Peddler, CHRO No. 9830387, Memorandum of decision on motion to amend
(May 14, 1999).
Piercing a corporate veil for purposes of liability and damages is distinct from
determining the reasonableness of a proposed amendment to add a respondent.
However, to determine the reasonableness of the commission's amendments to add a
parent corporation with the intention of piercing the corporate veil at public
hearing, some consideration should also be given to the criteria for piercing a
corporate veil. To determine whether piercing the corporate veil is proper, the
Connecticut Supreme Court and previous commission decisions have endorsed two
tests: the instrumentality rule and the identity rule. "The instrumentality
rule requires, in any case but an express agency, proof of three elements: (1)
Control, not mere majority or complete stock control, but complete domination,
not only of finances but of policy and business practice in respect to the
transaction attacked so that the corporate entity as to this transaction had at
the time no separate mind, will or existence of its own; (2) that such control
must have been used by the defendant to commit fraud or wrong, to perpetuate the
violation of a statutory or other positive legal duty, or a dishonest or unjust
act in contravention of plaintiff's rights; and (3) that the aforesaid control
and breach of duty must proximately cause the injury or unjust loss complained
of." (Internal quotation marks omitted; citations omitted.) Tomasso v.
Armor Construction & Paving, Inc., 187 Conn. 544, 553 (1982); Commission on
Human Rights and Opportunities ex rel. Robert Henry v. Edwards Super Food
Stores, CHRO No. 9510617, Ruling on Respondents' Motion to Dismiss and
Commission's Motion for Stay, 3 (September 1, 1999).
"The identity rule has been stated as follows: If plaintiff can show that
there was such a unity of interest and ownership that the independence of the
corporations had in effect ceased or had never begun, an adherence to the
fiction of separate identity would serve only to defeat justice and equity by
permitting the economic entity to escape liability arising out of an operation
conducted by one corporation for the benefit of the whole enterprise."
(Internal quotation marks omitted; citations omitted.) Tomasso, 187 Conn. 554;
CHRO ex rel. Robert Henry, 4.
In its motions, the commission proposes, inter alia, to add Worldwide as a
respondent. Although objecting to adding Worldwide as a respondent, Learning
Center identifies no prejudice to it if Worldwide is added.
Worldwide also objects to being added as a respondent. Worldwide claims that the
amendment is untimely because "[a]ll information in support of the motion
to amend was known to the Complainants and the Commission during the
investigation of this matter." However, the commission contends that the
motion is timely because Worldwide's role did not become clear until after the
production of documents and related problems in obtaining the documents.
Worldwide contends that becoming a respondent at this late date would be
prejudicial. However, the Connecticut Supreme Court has upheld an amendment
belatedly adding a subsidiary corporation's parent corporation. Wroblewski v.
Lexington Gardens, Inc., 188 Conn. 44 (1982). Specifically, Worldwide asserts
that it would be prejudiced because there is no factual or legal basis for it to
be named as a respondent, it was not the complainants' employer and it did not
participate in the decisions to terminate the complainants' employment. These
are factual issues relating to the merits of the complaints to be resolved at
the public hearing.
Worldwide further claims it would be prejudiced because it would not have had
the benefit of the investigative stage of the commission's process. The purpose
of the investigative stage is for "determining if there is reasonable cause
for believing that a discriminatory practice has been or is being committed as
alleged in the complaint." General Statutes § 46a-83(c). Worldwide offers
no evidence that a finding of reasonable cause would not have been made had it
been named as a respondent in the original complaint.
Worldwide also contends that being added as a respondent at this time would
deprive it of the ability to make a timely defense and subject it to the
unnecessary costs of appearing in Connecticut where it has no presence. The
public hearing can be continued if Worldwide can demonstrate that it actually
requires more time to prepare its defense. However, since the commission served
its motion on Worldwide in April, Worldwide already has had over three months to
prepare for a public hearing that is still over a month away. Also, Worldwide
is, indeed, effectively present in Connecticut if at the public hearing the
commission and the complainants establish that the corporate veil between
Learning Center and Worldwide should be pierced.
According to Worldwide, its presence is not necessary to make a complete
determination of the issues in these cases. However, if liability is found, if
the corporate veil is pierced and even if Learning Center has sufficient assets
to pay a damage award, the commission would still have an interest in seeking
relief against Worldwide, such as a cease and desist order. General Statute §
The consideration of other factors also supports the conclusion that the
amendments are reasonable. Learning Center is a wholly owned subsidiary of
Worldwide (CHRO Ex. 2, p. 66/67), and the two corporations share officers and
directors. Despite the claim that William T. Daniels ("Daniels") was
the president of Learning Center (Respondents' Exs. 1 and 2; Tr. 108), more
credible are the documents filed with the state and federal governments by
Learning Center and Worldwide. In its 1999, 2000 and 2001 filings with
Connecticut's Secretary of the State, Learning Center identified Thomas J.
Bresnan ("Bresnan") as Learning Center's president, chairman of the
board and chief executive officer; Robert S. McMillan ("McMillan"), as
chief financial officer; and Stuart O. Smith ("Smith"), as secretary.
None of these people have Connecticut residence or business addresses. (CHRO Exs.
5, 6 and 7.)
Bresnan, McMillan and Smith also appear in Worldwide's documents. In its 2000
and 2001 filings with the federal government, Worldwide identifies Bresnan as
its president, chief executive officer and a director; McMillan as its vice
president, treasurer, chief financial officer and a director; and Smith as its
vice chairman of the board, secretary and director. (CHRO Ex. 2, p. 33/67, p.
35/67; CHRO Ex. 3, p. 36/61, p. 38/61.)
On the complainants' 2000 W-2 form, Learning Center gives an address in Windsor,
Connecticut. But, on the 2001 W-2 forms, Learning Center's address is in
Anaheim, California. (CHRO Exs. 11 and 13.) Learning Center's California address
is the same street number, suite number, city and state as Worldwide's principle
executive office. (CHRO Exs. 3 and 4.)
There is unrebutted testimony that (1) Worldwide published and distributed to
Learning Center detailed manuals of policies and procedures for Learning
Center's required use. Mandatory hiring and termination procedures were included
in these manuals. (CHRO Exs. 8 and 9; Tr. 34-37, 39, 43, 47-48, 81-83, 88-91,
94); (2) Learning Center provided detailed information to Worldwide on a weekly
basis (CHRO Ex. 12; Tr. 41-43, 51-52); and (3) Daniels, one of the
decision-makers involved in the complainants' terminations, spent three out of
four weeks per month at Worldwide's California office. (Tr. 44, 98.)
I note that this is a ruling on the reasonableness of motions to amend two
complaints, not a ruling that the corporate veil is pierced as to liability and
damages. Although these additional factors alone may not be sufficient for
piercing the corporate veil to impose liability and damages at the public
hearing, these factors do contribute to the reasonableness of the commission's
proposed amendments to the complaints. As this is simply a ruling on the
reasonableness of motions to amend, the commission and the complainants will
still need to prove liability and damages at the public hearing and that the
corporate veil should be pierced. The respondents retain the opportunity at the
public hearing to present evidence disputing liability and damages and that,
even if liability is found, the corporate veil should not be pierced.
In its motions, the commission also proposes to correct Abildgaard's address, to
amend paragraphs 3 and 8 of Abildgaard's complaint and to amend paragraph 7 of
L'Annunziata's complaint. While these changes probably could have been made more
timely, neither Learning Center nor Worldwide identifies any prejudice resulting
from these proposed amendments. The correction of Abildgaard's address is simply
ministerial. The change to paragraph 3 of Abildgaard's complaint appears
reasonably related to paragraph 13b of the complaint. After reviewing the
complaints and answers, the proposed identical amendments to paragraph 8 of
Abildaard's complaint and paragraph 7 of L'Annuziata's complaint appear
reasonable. These amendments are granted.
In summary, it is ordered:
1. The commission's motions to amend are granted.
2. The respondents, Learning Center and Worldwide, shall file and serve their
answers to the amended complaints on or before August 21, 2003.
3. As previously ordered:
a. Exhibit and witness lists shall be filed and served on or before August 14,
2003. Also on or before August 14, 2003, the parties shall serve copies of
proposed exhibits other than those proposed exhibits protected by the protective
order. The exhibit list shall indicate which proposed exhibits are protected by
the protective order.
b. The prehearing conference remains scheduled for September 4, 2003 at 10:00 AM
in the Small Hearing Room, 4th Floor, 21 Grand Street, Hartford, CT.
c. The public hearing remains scheduled for September 16-19, and 23-26, 2003
commencing at 9:30 AM at 21 Grand Street, Hartford, CT.
4. Supplemental witness and exhibit lists may be filed and served, and proposed
exhibits served, on or before September 2, 2003.
5. Exhibit lists and supplemental lists shall include the number of pages of the
6. Exhibits not served because they are claimed to be protected under the
protective order shall be brought to the prehearing conference.
Hon. Jon P. FitzGerald
Presiding Human Rights Referee
Mr. P. L'Annunziata
Mr. W. Abildgaard
D. Metzger, Esq.
A. Simonetti, Esq.