Amatuzio v. Gandalf Systems Corp.
| Citation | 994 F.Supp. 253 |
| Decision Date | 04 February 1998 |
| Docket Number | Civil Action No. 95-4808(JEI).,Civil Action No. 96-621(JEI). |
| Parties | Dolores AMATUZIO, et al., Plaintiffs, v. GANDALF SYSTEMS CORPORATION, et al., Defendants. William CHAMBERS, et al., Plaintiffs, v. GANDALF SYSTEMS CORPORATION, et al., Defendants. |
| Court | U.S. District Court — District of New Jersey |
Mattioni, Mattioni & Mattioni, LLP by Joseph F. Bouvier, Westmont, NJ, for plaintiffs.
Obermayer, Rebmann, Maxwell & Hippel by Stephen D. Schrier, James M. Penny, Jr., Marjorie H. Gordon, Haddonfield, NJ, for defendants.
This matter comes before this Court on defendants Gandalf Systems Corp. and Gandalf Technologies, Inc.'s motion for summary judgment as to all claims in this action, and plaintiffs' cross-motion for summary judgment as to all claims. The disputes in this action arise out of a severance pay plan covered by the Employee Retirement Income Security Act ("ERISA"), and defendants' obligation under the Worker Adjustment and Retraining Notification Act ("WARN"), to give affected employees notice of a mass layoff and/or plant closing. This Court has jurisdiction under 28 U.S.C. § 1331.
For the reasons that follow, this Court will: (1) find that Class One and Class Two plaintiffs have standing under ERISA, but that Class One Subclass "A" plaintiffs lack standing; (2) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to plaintiffs' claim that they are entitled to vested benefits; (3) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to all plaintiffs' equitable estoppel claims; (4) grant defendants' motion for summary judgment as to plaintiffs' claims that the severance plan modification is void because plaintiffs were not timely noticed of the severance plan modification and were not timely given a summary plan benefits description, and deny plaintiffs' cross-motion for summary judgment as to these claims; (5) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to plaintiffs' claim that the severance plan modification was invalid because defendants did not follow the plan's amendment procedure; (6) deny defendants' motion for summary judgment as to Class Two plaintiffs' WARN claim, and grant plaintiffs' cross-motion for summary judgment as to Class Two plaintiffs' WARN claim; and, (7) deny both defendants' motion for summary judgment and plaintiffs' cross-motion for summary judgment as to Class Three plaintiffs' WARN claim.
Plaintiffs Dolores Amatuzio et al. commenced this action by filing by the Complaint in Civil Action No. 95-4808 on September 19, 1995. On February 20, 1996, plaintiffs William F. Chambers et al. (Chambers) filed the Complaint in Civil Action No. 96-621. Chambers filed the Amended Complaint in No. 96-621 on April 25, 1996.
By Order dated June 4, 1996, this Court ordered the consolidation for all purposes of Civil Action Nos. 95-4808 and 96-621 under the lead case number of 95-4808. By Consent Order Concerning Class Certification dated June 17, 1996, the Magistrate Judge certified the three classes of plaintiffs described below in Part I.B. By Order dated October 18, 1996, the Magistrate Judge granted Chambers leave to file a second amended complaint. Chambers filed the Second Amended Complaint in No. 96-621 on October 21, 1996, carving out the subclass of plaintiffs as described below in Part I.B.
On June 7, 1996, defendants Gandalf Systems Corp. and Gandalf Technologies, Inc. ("defendants") filed a motion to dismiss and to strike. By Order dated July 5, 1996, this Court denied the motion to dismiss the First Count of the Complaint in No. 95-4808 and the First Count of the Amended Complaint in No. 96-621. By the same Order this Court granted defendants' motion to dismiss those portions of the Second Count of the Complaint in No. 95-4808 and the Second Count of the Second Amended Complaint in No. 96-621 that were brought pursuant to the Employment Retirement Income Security Act § 510, 29 U.S.C.A. § 1140.
Defendants filed the instant motion for summary judgment as to all remaining counts and claims in this consolidated action on October 24, 1997. On the same date plaintiffs filed the instant cross-motion for summary judgment as to all remaining counts and claims.
Defendant Gandalf Systems Corp. ("GSC") is a New Jersey-based company engaged in the design, marketing and sale of telecommunications products and services. Defendant Gandalf Technologies, Inc. ("GTI"), a Canadian corporation, is GSC's parent company. GSC was created in 1991 when Gandalf Data, Inc. ("GDI") merged with Infotron Systems Corporation ("Infotron"). At all times relevant to this action GSC was headquartered in a Cherry Hill, New Jersey, facility formerly occupied by Infotron. The majority of GSC's Cherry Hill employees were former Infotron employees who had remained with GSC following the 1991 Infotron/GDI merger.
Plaintiffs are former employees of GSC who worked in Cherry Hill and who ceased to be employed by GSC at various times between January 14, 1994, and August 31, 1994. Plaintiffs are divided into three classes and one subclass. Eight named plaintiffs ("the individual plaintiffs") — also members of Class One and Class Two — bring individual claims. Class One plaintiffs are former GSC employees who received notice from GSC on February 22, 1994, that they would be laid off on or after April 25, 1994, and WARN1 notice of a plant closing scheduled to take place on or after April 25, 1994. Class One Subclass "A" ("Subclass `A'") plaintiffs are seventeen former GSC employees who resigned between January and July of 1994. Class Two plaintiffs are former GSC employees who were laid off on or about February 22, 1994, and who were not given WARN notice. Class Three consists of former GSC employees who were laid off on or about January 14, 1994, and who were not given WARN notice.
Class One and Class Two plaintiffs claim they are entitled to vested severance pay earned pursuant to a severance plan initially established by Infotron ("the Manual plan"), as set forth in an Infotron managers' personnel manual, and maintained by GSC until February 17, 1994, when GSC announced a modified severance pay plan. Specifically, Subclass "A" plaintiffs received no severance pay. They maintain they are entitled to severance pay according to the terms of the Manual policy because their resignations were involuntary. The rest of the Class One and all Class Two plaintiffs received severance pay according to the terms of the modified plan. They claim they are entitled to severance pay according to the terms of the Manual plan. Class One and Class Two plaintiffs also seek to void GSC's severance plan modification, claiming it was implemented improperly. The individual plaintiffs, and all plaintiffs in Civil Action No. 95-4808, have brought claims of equitable estoppel based on alleged false representations made to them to the effect that the Manual plan would not be changed.
Class Two and Class Three plaintiffs also allege that defendants violated the Worker Adjustment and Retraining Notification Act, 29 U.S.C.A. §§ 2101-2107 ("WARN"), by terminating their employment without providing sixty-days' notice.
In or around 1984, Infotron developed a personnel policy and procedures manual entitled "Personnel Guidelines for the Manager" ("the Manual"). The Manual was kept in Infotron's Human Resources Department and was distributed to Infotron management employees for reference in handling day to day employee issues and questions. The introduction to the Manual states in pertinent part:
This manual is designed to be an overall guide for supervisory personnel in their day-to-day administration. Additions, revisions and deletions will be issued from time to time.... Provisions of these guidelines are not to be considered policies binding on Infotron. They may be changed at any time as management deems appropriate. They are not intended to and do not constitute expressed or implied contractual obligations to anyone.
Section 2, Guideline 2-5 of the Manual — entitled "Termination" — sets forth in desultory fashion a policy on resignation, discharge and severance pay. The Manual provides in pertinent part:
1.3.1 Voluntary Resignation
Voluntary resignation is initiated by the employee. Employees other than managers and directors are expected to give at least two weeks' notice of resignation; .... Severance pay is not given in cases of voluntary resignation.
1.3.2 Involuntary Resignation
... if the resignation is requested by the company for other than misconduct or cause:
— non-exempt = one week's pay for each full year of employment
— exempt = two weeks' pay for each full year of employment
— officers = three weeks' pay for each full year of employment ...
1.3.3 Discharge
Discharge is initiated by the Company....
1.3.4 Severance Allowance
The purpose of severance allowance is to provide an employee with income during a period of financial adjustment precipitated by the Company's termination of his/her employment.
Under no circumstances will severance allowance be paid in cases of discharge for misconduct (i.e., insubordination, embezzlement, misappropriation of funds, misrepresentation, etc.).
It is undisputed that rank and file employees were generally familiar with the Manual plan, though they were not given copies of the Manual. How they came to be familiar with the Manual plan, whether they knew it was housed in written form in the Manual or elsewhere, and to what extent, if at all, they understood the Plan's details and were aware of the Manual's contractual disclaimer and reservation of rights clause, are all much foggier matters. The evidence suggests...
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