Algie v. RCA Global Communications, Inc.

• Citation: 891 F. Supp. 875
• Decision Date: 22 November 1994
• Docket Number: No. 89 Civ. 5471 (MJL) (MHD).,89 Civ. 5471 (MJL) (MHD).
• Parties: Thomas ALGIE, et al., Plaintiffs, v. RCA GLOBAL COMMUNICATIONS, INC. and MCI Communications Corporation, Defendants.
• Court: U.S. District Court — Southern District of New York

891 F. Supp. 875

Thomas ALGIE, et al., Plaintiffs, v. RCA GLOBAL COMMUNICATIONS, INC. and MCI Communications Corporation, Defendants.

No. 89 Civ. 5471 (MJL) (MHD).

United States District Court, S.D. New York.

November 22, 1994.

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John C. Lankenau, Lankenau, Kovner & Kurtz, New York City, for plaintiffs.

Christine H. Purdue, Hunton & Williams, Fairfax, VA, for defendants.

MEMORANDUM AND ORDER

DOLINGER, United States Magistrate Judge.

The twenty-three plaintiffs in this case were all long-term employees of defendant RCA Global Communications, Inc. ("RCAG"). They have sued to recover severance benefits allegedly denied them under a plan sponsored by RCAG.

Plaintiffs were each advised that their employment was being terminated one to three days after the stock sale of RCAG to MCI Communications Corporation ("MCIC") on May 16, 1988. They were later paid severance benefits under the MCIC plan rather than under the more generous RCAG plan. In explaining this decision, defendants have claimed that the RCAG plan was terminated as of the closing, and alternatively have asserted that plaintiffs ceased to be RCAG plan participants at that time because they became employees of MCIC's subsidiary MCI International, Inc. ("MCII").

As a result of several pre-trial decisions, plaintiffs were left with one triable claim, under section 502(a)(1)(B) of the Employee Retirement Income Security Act, 29 U.S.C. § 1132(a)(1)(B), for the denial of benefits. (See Algie v. RCA Global Communications, Inc., 1994 WL 132358 (S.D.N.Y. April 12, 1994)). However, the court also granted plaintiffs partial summary judgment on that claim, holding that they had established beyond triable dispute that the RCAG severance plan had not been terminated by the time that they were fired in late May 1988. (Id. at *22-24). Accordingly, the court defined two issues for trial:

1. Did the plaintiffs remain RCAG employees until their post-closing termination?

2. If not, was their departure from RCAG a "layoff" within the meaning of the RCAG severance benefit plan?

(Id. at *32). Thus, at trial the first issue to be determined was whether plaintiffs continued as RCAG employees for the few days between the stock purchase of RCAG by MCIC and their termination or else became employees of defendant MCII in that intervening time.

The court conducted a jury trial on these two questions from July 18 to 26, 1994. At the conclusion of the trial the jury returned a verdict for plaintiffs on the first question, finding that they were still RCAG employees at the time of termination. In view of this finding, the jurors were not required to reach the second question.

In the wake of the trial, defendants have moved for judgment as a matter of law or alternatively for a new trial. Plaintiffs in turn have moved for an award of attorney's fees and expenses and for pre-judgment interest. For the reasons that follow, defendants' motions are denied and plaintiffs' motions are granted.

I. Defendants' Motions

As noted, defendants seek judgment as a matter of law. This application is based principally on their contention that the trial evidence demonstrates that the RCAG plan was replaced by the MCIC severance plan just prior to the termination of the plaintiffs. Alternatively, defendants seek a new trial based on their contention that the court erred in three respects in its jury charge. I address these issues in the order presented.

A. The Rule 50(a) Motion

Defendants' motion for judgment rests on two grounds. First, they assert that the RCAG plan was no longer in effect when the plaintiffs were terminated shortly after the closing in which MCIC purchased the stock of RCAG. In support of this contention defendants point principally to evidence that they introduced at trial indicating that in late June 1988 the MCIC Board of Directors had issued a consent that, in substance, authorized the extension of MCIC's severance plan to all employees of RCAG, effective retroactively to the date of the closing. (Tr. 974-77 & Defs.' Exh. 131). Defendants argue that this evidence demonstrates that MCIC intended to replace the RCAG plan with the MCIC plan even for RCAG employees, and therefore, even if plaintiffs remained RCAG employees until their severance — as found by the jury — they were not entitled to be paid under the RCAG plan. This argument fails for both procedural and substantive reasons.¹

Second, defendants argue that the decision of the RCAG plan administrators to deny severance benefits to plaintiffs must be judged under an "arbitrary and capricious" standard. So viewed, defendants assert, that decision must be upheld. This argument cannot be sustained in view of both the wording of the severance plan and the grounds stated by the administrators for denial of benefits.

1. The Asserted Termination of the RCAG Plan

Federal Rule of Civil Procedure 50(a)(1) provides as follows:

If during a trial by jury a party has been fully heard on an issue and there is no legally sufficient evidentiary basis for a reasonable jury to find for that party on that issue, the court may determine the issue against that party and may grant a motion for judgment as a matter of law against that party with respect to a claim or defense that cannot under the controlling law be maintained or defeated without a favorable finding on that issue.

The standards for applying this rule are the same as under the predecessor rule, which governed motions for a directed verdict and for a judgment notwithstanding the verdict. See, e.g., Piesco v. Koch, 12 F.3d 332, 340 (2d Cir.1993). As the Second Circuit has recently summarized, "when faced with such a motion, the trial court must consider the evidence in the light most favorable to the nonmoving party and must `give that party the benefit of all reasonable inferences that the jury might have drawn in his favor from the evidence.'" Toltec Fabrics, Inc. v. August Inc., 29 F.3d 778, 782 (2d Cir.1994) (quoting Smith v. Lightning Bolt Prods., Inc., 861 F.2d 363, 367 (2d Cir.1988)). In doing so, "the court is not allowed to weigh conflicting evidence, or assess the credibility of the witnesses, or substitute its judgment for that of the jury." Id. Judged by these standards, the motion must be denied "unless ... `the evidence is such that, without weighing the credibility of the witnesses or otherwise considering the weight of the evidence, there can be but one conclusion as to the verdict that reasonable persons could have reached.'" Cruz v. Local Union No. 3 of the IBEW, 34 F.3d 1148 (2d Cir.1994) (quoting Simblest v. Maynard, 427 F.2d 1, 4 (2d Cir. 1970)).

As is evident from the text of the rule and its elaboration by the courts, the Rule 50(a) remedy is addressed to issues that were the subject of the trial. Defendants' motion, however, insofar as it rests on trial evidence concerning the alleged termination of the RCAG plan, is mislabelled since the question of whether the RCAG plan had been terminated prior to plaintiffs' departure was not an issue at the trial. As noted, that question was determined as a matter of summary judgment three months before the trial. Indeed, there can be no question as to this matter since the summary judgment decision explicitly held that the defendants had failed to demonstrate a triable dispute on this issue and then proceeded to limit the trial to two other factual issues, as to which the parties' summary judgment motion papers demonstrated triable questions.

Viewed in context, it is evident that defendants' application is, in substance, a motion for reconsideration of the court's prior summary judgment ruling based upon evidence received for different purposes at trial. There are obvious procedural problems with this effort, and in any event there is no substantive justification for the relief that is sought.

The initial hurdle is that defendants' motion, properly characterized, is both untimely and otherwise in violation of the local rule that governs such motions. The relevant provision is Rule 3(j) of the Civil Rules of this court, which provides that a motion for reconsideration "shall be served within ten (10) days after the docketing of the court's determination of the original motion." Although this time limit may not be jurisdictional Hershfang v. Citicorp, 1991 WL 197699, at *1 (S.D.N.Y. Oct. 1, 1991), it is enforced absent adequate justification for ignoring it. See, e.g., Blanco v. United States, 775 F.2d 53, 55-56 (2d Cir.1985); see also Donahue v. Pendleton Woolen Mills, 719 F.Supp. 149, 150 (S.D.N.Y.1988) (although motion was untimely, "in the interest of justice" court did not dismiss motion). In this case defendants offer no justification for their failure to meet the time limit or even to come remotely close to it. Indeed, defendants' motion papers are silent on this problem, and at oral argument their counsel conceded that, until shortly before the trial, defendants had simply overlooked the evidence on which they now rely. Since both the facts underlying the Board of Directors' decision and the documentation of it were uniquely in the control of defendants, this omission has not been explained and can hardly be justified. Indeed, if we assumed arguendo that the evidence otherwise might justify the relief sought, then the delay in producing it would be inexcusable since it resulted in an unnecessary seven-day trial.

Defendants' motion also fails to satisfy a second part of Rule 3(j). A motion for reargument is ordinarily limited to errors assertedly made by the court in its original decision, and it is not the vehicle for the losing party to submit additional evidence. See Ades v. Deloitte & Touche, 843 F.Supp. 888, 891-92 (S.D.N.Y.1994); Collins Development Corp. v. Marsh & McLennan, Inc., 1991 WL 135605, at *4 (S.D.N.Y. July 18, 1991). Cf. Transaero, Inc. v. La Fuerza Aerea Boliviana, 38...