Davis v. First Nat. Bank of Killeen, Tex., 91-8666
| Decision Date | 09 November 1992 |
| Docket Number | No. 91-8666,91-8666 |
| Citation | 976 F.2d 944 |
| Parties | 60 Fair Empl.Prac.Cas. (BNA) 387, 60 Empl. Prac. Dec. P 41,861, 24 Fed.R.Serv.3d 235 JAMES B. DAVIS, Plaintiff-Appellee, Cross-Appellant, v. The FIRST NATIONAL BANK OF KILLEEN, TEXAS, Defendant-Appellant, Cross-Appellee. |
| Court | U.S. Court of Appeals — Fifth Circuit |
A.J. Harper, II, Paula M. Johnson, Teri L. Danish, Fulbright & Jaworski, Houston, Tex., for appellant.
Jon R. Ker, Hewitt, Tex., for appellee.
Appeals from the United States District Court for the Western District of Texas.
Before POLITZ, Chief Judge, WISDOM and WIENER, Circuit Judges.
In this case, implicating the Age Discrimination in Employment Act (ADEA), 1 Appellant/Cross-Appellee First National Bank of Killeen (the Bank) convinced the district court to grant part of the Bank's motion for judgment notwithstanding the verdict (j.n.o.v.) to the extent the jury found that the Bank willfully violated the ADEA by constructively discharging Davis. The jury had awarded Davis $75,000 in damages. The Bank appeals the court's refusal to grant the remaining part of the motion for j.n.o.v. for other amounts awarded by the jury in connection with the discharge of Davis by the Bank, which the jury found to be constructive and to be discriminatory on the basis of age. By cross appeal, Davis complains of the district court's j.n.o.v. reversing the jury's finding that the Bank knowingly violated the ADEA, and insists that the trial court erred in calculating the front pay awards in favor of Davis. Acknowledging that the facts present a close question but concluding nonetheless that the evidence is insufficient to supply the required nexus between the Bank's treatment of Davis and his age, we reverse the judgment of the district court and render judgment dismissing Davis's action.
Davis went to work for the Bank in 1955 and was employed there continuously until he resigned effective May 1, 1988, a period of approximately 33 years. In the course of his banking career, Mr. Davis rose to the position of Vice President in Charge of Commercial and Consumer Loans, a title he held at the time the present holding company owner acquired the Bank. He was also a voting member of the Loan Committee at that time, but was relieved of voting status following the change in ownership.
In July of 1987, Davis suffered a heart attack and was away from work for approximately five months. In November of that year, his doctor advised that Davis Prior to his heart attack, Davis had been a member of a task force organized to analyze dealer loans and make recommendations for improved procedures. Following his heart attack, Davis was replaced on the task force by Mr. Steve Mills, an executive employee transferred to the Bank from another bank owned by the same holding company. In his 30's, Mills also replaced Davis in the consumer loan department of the Bank.
could return to work, beginning on a half-day basis, but the Bank's president advised Davis to stay home until he could return on a full-time schedule. In mid-December Davis met with the Bank's president to discuss full-time return and was advised that when he did it would be as supervisor of the dealer department, at the same salary and with the title of Vice President
When Davis returned to work he found he was the only member of the dealer department and that there were no personnel there for him to supervise. He did not have a secretary or anyone under his direct supervision to assist him. Neither before his heart attack nor after his return was Davis advised as to his duties, functions or responsibilities in the dealer department. He was furnished no documentation regarding changes in policies or procedures in that department, and his letter to the Bank's president concerning goals for the department went unanswered. In the conduct of his new assignment he was criticized by voting members of the Loan Committee in ways that Davis considered inconsistent and unfair.
In April, 1988, the president convened a meeting with Davis at which Mr. Rick Carlisle was present. Davis was advised that he had lost credibility with and the confidence of management and ownership. The president advised Davis to consider an early retirement resignation; that otherwise he would face being placed on probation. Carlisle, former President, CEO and Chairman of the Board of the Bank testified as to Davis's loyalty and competence but acknowledged that in light of Carlisle's impression that the new ownership group had decided to replace the previously existing management team with new employees more attuned to the style and policy views of the new ownership, Davis's future was bleak. It was Carlisle's opinion that the new ownership had decided to put their own people in to replace executives of the Bank whose tenure pre-dated the holding company's acquisition. Carlisle was satisfied that the officers from the previous regime who still remained at the Bank simply did not fit in with the new concepts brought in by the holding company after the acquisition. He speculated that new management could ease out members of the preexisting regime by making it difficult for them to get their loans approved. Carlisle observed that 15 officers from the former regime were no longer with the Bank; that only one was an active officer; and that a second was a member of the Board only. Even Carlisle admitted his disagreement with style and policy of the new management. According to Davis, Carlisle said nothing during the meeting with the Bank's president, and Davis himself gave no indication to the President whether he would resign as requested, effective May 1, 1988, or continue subject to probation. Davis stated that he knew, however, that the die was cast by the tone of the meeting and the statements about loss of confidence and credibility.
Another former officer, Mr. Jack Vernon, testified that in his opinion the holding company intentionally weakened the ability of the pre-existing officers to perform, and that new management preferred not to have members of the pre-acquisition officer corps, with their close ties to the community, involved in running the Bank. Vernon testified that he observed a pattern of replacing members of the pre-existing team with younger employees.
Still without advising of his decision, Davis asked the president on the day following the meeting with Carlisle, for permission to take three weeks' vacation which permission was granted. Despite Davis's postponement of making his decision, Carlisle wrote on that day (April 19, 1988) announcing to other bank personnel that Davis would retire, effective May 1. Thereafter, Davis wrote to Carlisle, the Davis testified that, following the effective date of his termination, he sought employment in and around Killeen, attempting to sell water purifiers, to obtain an insurance license, and to become a salesman for A.L. Williams Company. He further testified that efforts to obtain bank employment were fruitless given the condition of the banking industry in the Killeen area, as well as his age and physical condition but that he had remained willing to return to the Bank as Vice President in Charge of Commercial and Consumer Loans.
Bank president and other members of the Board, recounting his version of the April 18th meeting, his shock, his financial needs, and the inevitability of his termination by current management, concluding that he had no choice but to end his 33 years of service by resigning effective May 1, 1988. He was again replaced by Mills
According to witnesses for the Bank, new management determined on the basis of internal audits that some $5 million in loans had to be charged off and that significant changes were needed in the Bank's lending policy as well as other policies and procedures. Stricter Comptroller of the Currency guidelines and regulations as well as the chaos in the banking industry in Texas and surrounding states were other reasons attributed by the Bank's witnesses to the need for changes. There is no dispute but that drastic policy and philosophy changes were made and that the changes were shocking to employees whose service pre-dated the change in ownership. This was particularly true for loan officers whose procedures were changed most drastically. Also uncontested is the fact that when Mills was brought in from another bank following Davis's heart attack, he (Mills) was under the ADEA's triggering age of 40 years, and his salary was "slightly less" than Davis's.
Witnesses for the Bank also testified that Davis demonstrated a lack of adaptability to the new lending environment and that his deficiencies were pointed out to him but that, in the opinion of the Bank's president, Davis's performance did not improve, leading to the meeting of April 18, 1988. The president testified that his purpose in calling the April 18th meeting was to place Davis on probation, and that when the 90-day probation was announced to Davis he responded that he was not going to accept probation. The president testified that he was surprised by the reaction because probation was not offered as a choice; but that in light of the unexpected reaction, he told Davis he should consider early retirement and that the Bank would confect an early retirement package for Davis to consider. According to the president, he was informed by Davis the next day that he (Davis) would take early retirement after using his remaining vacation prior to the effective date of resignation. April 19, 1988, was Davis's last day at work.
The early retirement package proposed by the Bank was presented to and accepted by Davis on April 27, 1988. In addition, Davis received a lump sum distribution of $204,000 from the Bank's profit sharing plan, of which $179,340.74 represented the Bank's contributions, earnings and forfeitures.
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