Atchison v. Sears, Civil Action No. 08-3257.

• Decision Date: 07 October 2009
• Docket Number: Civil Action No. 08-3257.
• Citation: 666 F.Supp.2d 477
• Parties: Gerard W. ATCHISON, Sr., Plaintiff, v. SEARS, Sears Holdings Corporation, Sears Holdings, Sears, Roebuck and Co., and Sears Home Improvement Products, Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

666 F.Supp.2d 477

Gerard W. ATCHISON, Sr., Plaintiff, v. SEARS, Sears Holdings Corporation, Sears Holdings, Sears, Roebuck and Co., and Sears Home Improvement Products, Defendants.

Civil Action No. 08-3257.

United States District Court, E.D. Pennsylvania.

October 7, 2009.

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Sharon Ann Ziegler, Kingsport, TN, John Neumann Hickey, Law Offices of John N. Hickey, Media, PA, for Plaintiff.

Todd A. Ewan, Michael R. Galey, Fisher & Phillips, Radnor, PA, for Defendants.

MEMORANDUM

ROBERT F. KELLY, Senior District Judge.

Presently before the Court are the Motions for Summary Judgment filed by Defendants Sears, Sears Holding Corporation, Sears Holdings, Sears, Roebuck and Co., and Sears Home Improvement (collectively "Defendants" or "Sears"). For the following reasons, Sears's Motions will be granted.¹

I. BACKGROUND

A. Introduction

Gerard Atchison, Sr. ("Atchison" or "Plaintiff") is a former employee of Sears. In September 2007, while he was employed at Sears, Atchison was diagnosed with rheumatoid arthritis. As a result, in or around November 8, 2007, he applied and was approved for short-term disability benefits and leave pursuant to the Family and Medical Leave Act, 29 U.S.C. § 2601 ("FMLA"). On November 27, 2007, Atchison received a letter from Sears informing him that he was terminated pursuant to a Reduction-In-Force ("RIF") at the company.

On July 11, 2008, Atchison filed a Complaint against Defendants in this Court. Atchison's three-count Complaint set forth claims against Sears for violation of ERISA (29 U.S.C. § 1140), FMLA interference, and FMLA retaliation. During the course of discovery, Atchison learned that Sears's short-term disability plan was self-funded and was not governed by ERISA. As a result, pursuant to this Court's August 17, 2009 Memorandum and Order, Plaintiff was permitted to amend his Complaint to withdraw his ERISA claim and add a breach of contract claim. Atchinson v. Sears, No. 08-3257, 2009 WL 2518440 (E.D.Pa. Aug. 17, 2009). On August 21, 2009, Atchison filed his Amended Complaint where he makes the following claims: FMLA interference in Count I; FMLA retaliation in Count II; and breach of contract in Count III.

B. Atchison's Re-employment at Sears

Atchison is a licensed refrigeration and air conditioning repairman. He has been employed off and on by Sears entities throughout his employment history. Most recently, Sears Home Improvement Products'² ("SHIP") employed Atchison as a HVAC Project Coordinator at its office in Sharon Hill, Pennsylvania.

Atchison was hired for the Project Coordinator position in July 2005. In that role, his duties included scheduling projects, material management, supervising ongoing projects, and addressing customer service issues. Prior to being hired for this position, Atchison had not worked for a Sears entity since May 2004. Thus, per SHIP's 2007 Associate Handbook, Atchison did not receive credit for his prior service time because he was re-employed after more than a ninety-day gap in service. (Defs.' Mem. Supp. First Summ. J. Mot., Atchison 4 to Ex. B at 12.)

Significantly, when Atchison rejoined Sears in July 2005 he signed an "All-In-One Acknowledgment Form" which stated:

I understand as an associate of SHIPS I am employed under the Employment-At-Will doctrine. This means SHIPS does not offer, guarantee, contract, or promise employment for any specific length of time. I have the right to leave the Company at any time and the Company has the right to terminate the employment relationship at any time, with or without notice and with or without cause.... No supervisor, department head, or other member of management, except for the Senior Leadership Team acting at the direction of the VP/GM, has the authority to bind the company to any employment contract for any specific period of time with any associate, either verbally or in writing.

(Defs.' Mem. Supp. Second Summ. J. Mot., Ex. E (emphasis added).) Atchison signed this document on July 20, 2005, and initialed the section containing this language.

C. Atchison's FMLA Leave

There are two different time frames in 2007 when Atchison requested and was granted FMLA leave. First, from January 18, 2007 through February 12, 2007, Atchison was on FMLA leave because he underwent surgery for a tumor near his head and neck region ("January/February leave"). Second, on or around November 8, 2007, Atchison formally requested and was granted additional FMLA and short-term disability leave due to his rheumatoid arthritis. The FMLA leave granted in November is the one primarily at issue in this case.

At the conclusion of his January/February leave, Atchison was provided with a "FMLA LEAVE EXPIRATION NOTICE" ("FMLA Notice") that: 1) advised him that his FMLA leave entitlement expired on February 12, 2007; 2) notified him that although his rights under the FMLA ceased on February 12, 2007, he was eligible for additional leave under "[s]tate-specific leave as outlined in the Associate Rights Under Sears' Family & Medical Leave Policies"; and 3) advised him that he "will be entitled to job protection for additional leave." (Defs.' Mem. Supp. Second Summ. J. Mot., Ex. G.) The notice identified Atchison by name, was signed by company representative Sarah Frank, and was dated February 13, 2007. (Id.)

Atchison returned to his Project Coordinator position after the January/February leave. Notably, at his deposition, Atchison testified that he did not suffer any consequences at his job from taking this leave in early 2007. (Defs.' Mem. Supp. First Summ. J. Mot., Ex. B at 76:13-76:15.) In September 2007, Plaintiff was diagnosed with the rheumatoid arthritis. Subsequently, on or around November 8, 2007, Atchison again requested and was granted both FMLA leave and short-term disability leave due to his condition.³

D. SHIP's Reduction in Force

On November 27, 2007, Atchison received a letter advising him that he was terminated because his position had been eliminated pursuant to a SHIP company-wide RIF. Specifically, the letter stated: "Due to current business conditions, we have made some adjustments in our staffing to better fit our current structure. Consequently, we have made the decision to eliminate several positions. This impact has affected you, and your position was eliminated effective November 15, 2007." (Pl.'s Mem. Opp. First Summ. J. Mot., Ex. M.) In connection with the RIF, approximately seventy SHIP employees were laid off or demoted.⁴ (Defs.' Reply Mem. Supp. First Summ. J. Mot., Ex. 3; Defs.' Mem. Supp. First Summ. J. Mot., Ex. G at 10:2-10:5.)

As explained by SHIP's Director of Human Resources, Teige McShane ("McShane"), the "November 2007 reduction in force was precipitated by Sears' business needs including the need to save money during a period of reduced revenues" and was "economically motivated." (Defs.' Mem. Supp. First Summ. J. Mot., Ex. H at ¶¶ 6-7.) McShane stated that there were specific criteria established to determine which employees would be laid off according to the RIF. In sum, it was determined that "offices whose headcount supporting a product was greater than necessary would eliminate unnecessary positions managing the products that were overstaffed." (Id. ¶ 15; see also Defs.' Mem. Supp. First Summ. J. Mot., Ex. J at 28:23-29:4.) Further, "[i]f there was more than one individual managing an overstaffed product, the individual with the most recent service date was subject to inclusion in the reduction in force." (Defs.' Mem. Supp. First Summ. J. Mot., Ex. H ¶ 16; Ex. J at 28:23-29:4.)

The detailed criteria for the RIF were outlined in a SHIP document produced in this case entitled "Headcount Reduction Selection Criteria." (Defs.' Mem. Supp. First Summ. J. Mot., Ex. 2 to Ex. H.) The criteria dictated that "[p]roduct volume" established which offices and individuals managing the products in these offices were within the scope of a headcount reduction. (Id.) Next, the criteria stated that "[s]ervice" determined which individuals managing a product in a specific office were targeted for termination. (Id.) Specifically, the document stated: "If Criteria # 1 is met, the subordinate role managing the product is selected. If there are two in the same job title in the subordinate role, the one with the least service is targeted." (Id.) Finally, the outlined criteria mandated that "[p]erformance" could be considered in the determination. (Id.) The document stated: "If Criteria # 1 is met and there is a documented performance issue for the positions in scope, the individual with the performance issue is selected regardless of title or service." (Id.)

Based on the staffing of the HVAC product line at the SHIP office in Sharon Hill, Atchison's position was identified for inclusion in the RIF. Lawrence Hoerner ("Hoerner"), SHIP's Regional Director of Operations for the area covering the Sharon Hill office, made the ultimate decision to include Atchison in the RIF. According to Hoerner, Larry McDowell ("McDowell"), SHIP's Vice President of Operations and Hoerner's superior, directed him to implement the RIF in certain locations. In accordance with the aforementioned criteria, Hoerner determined that it was necessary to eliminate one HVAC Project Coordinator position in the Sharon Hill office.

The timing of the decision to include Atchison in the RIF is significant in this case. According to Hoerner, he made the decision to include Atchison in the RIF in September or early October 2007. Hoerner testified that he conferred with Robert Iandoli ("Iandoli"), SHIP's Metro Installation Manager and Atchison's direct supervisor, prior to making the decision. (Defs.' Mem. Supp. First Summ. J. Mot., Ex. L at 22:3-22:11.) Subsequently, Hoerner notified McDowell of his decision to include Atchison in the RIF. On October 17, 2007, McShane (SHIP's Director of Human...