November 7, 2014:
The Law Offices of Joshua N. Garick, P.C. filed a Complaint against Pepperidge Farm, Inc. alleging numerous causes of action including misclassification of an employee as an independent contractor in violation of the Massachusetts Independent Contractor Statute.
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Hathaway v. Pepperidge Farm, Inc.
U.S.D.C., D.Mass, C.A. No. 1:14-cv-14111-GAO
Pepperidge Farm sends deliverymen to distribute and stock supermarkets and convenience stores with baked goods such as cookies and breads. The Complaint alleges that distribution routes are sold to Pepperidge Farm employees who pay significant amounts, including finance charges, for the right to be employed by Pepperidge Farm. In this case, the distribution route was taken away without any compensation whatsoever to the employee. The Complaint, in part, alleges as follows:
Pepperidge Farm took the position that its classification of distributors like Hathaway as “independent contractors” was based on the element of a Consignment Agreement it entered into with its consignees that granted them a distributorship that Pepperidge Farm called a “valuable asset . . . akin to real estate or a similar market-based investment.” Pepperidge Farm, through unlawful, improper and malicious means took the one thing away from Hathaway that could (according to Pepperidge Farm) plausibly make the relationship that of an independent contractor. Pepperidge Farm unilaterally and unlawfully confiscated a portion of Hathaway’s distributorship, and forced him to sell the remaining portions of his now-devalued distributorship. This conduct, which was purposefully designed to sever Hathaway’s employment relationship with Pepperidge Farm the only way it believed it could, also deprived Hathaway of the benefits of the bargain of both the contract to purchase the distributorship and the Consignment Agreement.
The Complaint seeks $350,000 in damages, and includes counts of employment misclassification (G. L. c. 149, § 148B), breach of contract, breach of the duty of good faith and fair dealing, interference with contractual/advantageous relations, unjust enrichment, intentional infliction of emotional distress, and unfair and deceptive business practices (G. L. c. 93A). The lawsuit is pending in the United States District Court for the District of Massachusetts. Only time will tell which way the cookie will crumble.