Wiehoff v. GTE Directories Corp., Civ. No. 3-91-770.
| Decision Date | 27 December 1993 |
| Docket Number | Civ. No. 3-91-770. |
| Citation | 851 F. Supp. 1322 |
| Parties | James W. WIEHOFF, Plaintiff, v. GTE DIRECTORIES CORP., GTE Directories Sales Corp., and GTE Directories Service Corp., d/b/a GTE Sun Community Directories, Defendants. |
| Court | U.S. District Court — District of Minnesota |
Joseph W. Hammell and Catherine R. Landman, Dorsey & Whitney, Minneapolis, MN, for plaintiff.
John W. Polley and Patricia K. Oakes, Faegre & Benson, Minneapolis, MN, for defendants.
Before the Court is defendant GTE Directories Corporation, GTE Directories Sales Corporation and GTE Directories Service Corporation's (collectively "GTE") Motion for Judgment as a Matter of Law, pursuant to Rule 50(b) of the Federal Rules of Civil Procedure, on plaintiff Wiehoff's claims under the Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. (1988) ("ADEA" or "Act") and the Minnesota Human Rights Act, Minn.Stat. § 363.01 et seq. (1992) ("MHRA"). These claims were tried to a jury from November 1 to November 10, 1993.1 At the close of the plaintiff's case, GTE moved for judgment as a matter of law on both the federal and state law claims. The Court granted the motion with regard to claims of retaliation under the ADEA and MHRA; the motion was denied in all other respects. At the close of all the evidence, GTE renewed its motion for judgment as a matter of law, pursuant to Rule 50(b); that motion was denied and the matter was submitted to the jury. Following three days of deliberation, the jury unanimously declared that it was deadlocked; the Court accordingly declared a mistrial and discharged the jury on November 15, 1993. GTE timely filed this motion, which will be decided on the papers, without oral argument.
GTE moves for judgment as a matter of law on two grounds: With respect to Wiehoff's age discrimination claim under the ADEA, GTE argues that the plaintiff has only adduced evidence to support a claim for a "willful" violation; therefore, his ADEA claim is barred by the statute of limitations.2 GTE also contends that Wiehoff failed to adduce sufficient evidence at trial to allow a jury to find that GTE discriminated against him on the basis of his age, and that GTE is entitled to judgment in its favor on the federal and state law claims as a matter of law.
Plaintiff James Wiehoff is a 68-year-old resident of Minnesota. From 1981 to April of 1987, Wiehoff worked for Sun Community Directories ("Sun"), a division of Cowles Media. Wiehoff travelled to businesses in the Twin Cities metropolitan area and sold them yellow page advertising space in community directories. In 1987, defendant GTE Directories, Inc. acquired Sun from Cowles; Sun became GTE's Minneapolis Division. At the time of the acquisition, GTE retained all of the sales representatives on the Sun payroll. For the remainder of 1987, business was conducted as it had been under Sun's management. In 1988, however, GTE began to implement a number of changes.
In January of 1988, GTE terminated five former Sun sales representatives (but not Wiehoff) as part of a reduction in force. GTE then brought a new Division Manager, Kathleen Buffington, to the Minneapolis Division for the purpose of bringing that division into compliance with GTE's policies and procedures. GTE organized the Minneapolis Division into two units: a premise sales unit, in which representatives went into the community to contact clients; and a telephone sales unit, in which representatives stayed in the office and contacted clients and prospective clients by telephone.
Most notably, GTE changed the manner in which sales representatives worked and were paid. Under Sun, sales representatives were paid strictly on commission; they received a commission whether an account increased its advertising or merely renewed. Furthermore, Sun sales representatives had tremendous latitude to develop accounts. They were allowed to "follow themselves," — i.e., return to the same customers each year to seek their renewals. Under GTE's policy, each community directory represented a "market;" each market was broken into "territories" of equal dollar revenue. Sales representatives received a base salary and earned commissions only if they increased their territories by a predetermined amount, known as a "budget."
Data generated by GTE's sales division indicated that Wiehoff experienced difficulty achieving his "budget." Evidence adduced at trial showed that Wiehoff received "field coaching" from his immediate supervisor, Tom Joseph, on several occasions in the first half of 1988; Wiehoff continued to experience problems achieving "budget." Ms. Buffington transferred Wiehoff from the premises sales unit to the telephone sales unit in July of 1988. After Wiehoff had worked a short time in telephone sales, Ms. Buffington decided to terminate Wiehoff's employment. Wiehoff was fired from GTE on or about August 26, 1988, and this action followed.
Omaha Employees Betterment Ass'n v. City of Omaha, 883 F.2d 650, 651 (8th Cir.1989) (citation omitted).
GTE argues that the Court must dismiss Wiehoff's ADEA claim as time-barred because the evidence adduced at trial is consistent only with a claim for a `willful' violation of the Act. Wiehoff responds that the defendant has confused the concepts of intentional conduct that violates the Act with knowledge or reckless disregard for whether such conduct violates the Act. Only the latter constitutes a "willful violation" of the Act.
The Court will consider, first, the definition of a "willful violation" and, second, the ramifications of that definition for the statute of limitations.
The concept of a "willful violation" of the ADEA arises in two contexts. First, the statute provides that an employee who is the victim of a "willful" violation of the ADEA is entitled to liquidated damages. 29 U.S.C. § 626(b). Second, the Act defines the limitations period in terms of whether a claim alleges a willful or non-willful violation; a claim for a "non-willful" violation of the ADEA must be commenced within two years after the cause of action accrued, while a claim for a "willful" violation must be filed within three years after accrual of the cause of action. 29 U.S.C. § 626(e) ().3 The term "willful" carries the same meaning in both contexts. See McLaughlin v. Richland Shoe Co., 486 U.S. 128, 132-35, 108 S.Ct. 1677, 1681-82, 100 L.Ed.2d 115 (1988) (); EEOC v. Chrysler Corp., 729 F.Supp. 1002, 1006 (S.D.N.Y.1990).4
The Supreme Court defined a "willful" violation of the ADEA as one in which the employer "knew or showed reckless disregard for the matter of whether its conduct was prohibited by the ADEA." Hazen Paper Co. v. Biggins, ___ U.S. ___, ___, 113 S.Ct. 1701, 1708, 123 L.Ed.2d 338 (1993) (quoting Trans World Airlines v. Thurston, 469 U.S. 111, 126, 105 S.Ct. 613, 624, 83 L.Ed.2d 523 (1985)). In Hazen Paper, the Supreme Court criticized a number of circuits, including the Eighth Circuit, for refusing to apply the Thurston standard and award liquidated damages in "an informal disparate treatment case where age has entered into the employment decision on an ad hoc, informal basis rather than through a formal policy."5 ___ U.S. at ___, 113 S.Ct. at 1709. These circuit courts reasoned that every employer who engages in informal age discrimination knows or recklessly disregards the illegality of its conduct; therefore, modification of the showing required to establish a "willful violation" was necessary to preserve the two-tiered system of liability identified in Thurston.6
The Hazen Paper Court found the circuits' concerns about the two-tiered liability system to be "misplaced;" the principle of two tiers of liability was "simply one interpretive tool among several" used to decide what Congress meant by "willful." Id. The Court concluded that the plain language of the statute requires an award of liquidated damages whenever a violation was "willful" under the definition set out in Thurston. The Court stated its belief that uniform application of the Thurston standard of "knowledge or reckless disregard" would continue to maintain two tiers of liability across the range of ADEA cases, and provided examples of situations in which an employer could "non-willfully" violate the ADEA.7 Id.
The Court held that the employer in Hazen Paper had committed a willful violation of the ADEA; the employee's age constituted "an undisclosed factor motivating the employer on an ad hoc basis." Id. The Court reasoned that "it would be a wholly circular and...
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Wiehoff v. GTE Directories Corp.
...if believed, showed only a willful violation of the ADEA, and thus, Wiehoff's age claim was time barred. Wiehoff v. GTE Directories Corp., 851 F.Supp. 1322, 1328 (D.Minn.1993). The court did not decide whether Wiehoff presented sufficient evidence to allow a reasonable jury to conclude that......