Kartheiser v. American Nat. Can Co.

• Decision Date: 03 December 1999
• Docket Number: No. 4-98-CV-90339.,4-98-CV-90339.
• Citation: 84 F.Supp.2d 1008
• Parties: John KARTHEISER, Plaintiff, v. AMERICAN NATIONAL CAN COMPANY, Defendant.
• Court: U.S. District Court — Southern District of Iowa

84 F.Supp.2d 1008

John KARTHEISER, Plaintiff, v. AMERICAN NATIONAL CAN COMPANY, Defendant.

No. 4-98-CV-90339.

United States District Court, S.D. Iowa, Central Division.

December 3, 1999.

Pamela J. Prager, Des Moines, IA, for Plaintiff.

Thomas W. Foley, Kathryn Atkinson Overberg, Des Moines, IA, for Defendant.

ORDER RE: MOTION FOR SUMMARY JUDGMENT

PRATT, District Judge.

Now before the Court is Defendant American National Can Company's ("American Can") Motion for Summary Judgment of Plaintiff John Kartheiser's ("Kartheiser") action alleging breach of an agreement to pay him overtime and violation of the Iowa Wage Payment Collection Act. Plaintiff resisted the Motion and Defendant filed a reply brief; the matter is considered fully submitted. This case, before the Court on diversity jurisdiction, is controlled by Iowa law. See Frideres v. Schiltz, 113 F.3d 897, 898 (8th Cir.1997).

I. Statement of Facts¹

Kartheiser was employed by Defendant American Can beginning on September 12, 1985. He commenced his employment for Defendant as a Maintenance Mechanic. His duties in that position included repairing equipment and general maintenance, and he was paid an hourly wage. In 1987, he was promoted to Maintenance Foreman and began to directly supervise a crew of hourly employees. For this reason, he was eligible to receive, and did receive, additional compensation for certain overtime hours he worked. He received overtime compensation as provided for in the Engineering Office Manual's overtime policy, which provides that employees who are classified as exempt under the Fair Labor Standards Act may receive overtime under certain conditions if they directly supervise hourly employees.

On October 15, 1990, Kartheiser was promoted again, this time to the position of Supervisor of the Maintenance Department at American Can's Des Moines plant. The promotion included a 9% salary increase and a pay grade increase from 36 to 39. Kartheiser later became eligible for a bonus program, which earned him additional income. This position did not require Kartheiser to supervise any hourly employees.

On November 1, 1993, American Can instituted a mass discharge at the Des Moines facility, terminating, among others, all its foremen, including maintenance foremen. Kartheiser had supervised the maintenance foremen until this time. The mass discharge was part of a plan to institute a new "team concept," whereby foremen would not be necessary and employees would make more decisions on their own, with only minimal supervision. After the layoff, however, Kartheiser again became responsible for the supervision of hourly employees, directly supervising hourly maintenance crews and machinists. Neither Kartheiser nor any other department supervisor in the Des Moines plant who lost foremen regularly received overtime compensation after 1993. However, American Can at certain times paid overtime to other individuals who held positions similar to Kartheiser. These included Fred Tiernan, Extrusion Department Supervisor at the Des Moines facility, and Emil Bagulki, Maintenance Department Supervisor at the Neenah, Wisconsin plant. Tiernan, however, only received overtime after demanding it in return for extra work in 1996.

At some point after the November 1, 1993 mass layoff, Kartheiser spoke with Plant Manager Dave Kowalski or Engineering Manager Steve Jonjak to request that he be paid overtime. In April or May, 1994 and thereafter, American Can informed Kartheiser he was not eligible for overtime compensation as a Department supervisor. In part because of this dispute regarding overtime pay, Kartheiser resigned his position with American Can on August 2, 1996.

American Can maintained at least three different policy manuals at its Des Moines plant during Kartheiser's employment. The first, known as the Human Resources Standard Practice Manual ("H.R.Manual"), is maintained by American Can in the Human Resources Office. At page 1, the H.R. Manual states that:

The employment of all employees covered by these policies is not pursuant to any contract (either written or oral, express or implied), and is not for any set period or upon any set conditions, and is terminable at any time for any reason. Any Company manuals, handbooks, or other personnel-related material which employees or supervisory personnel may receive, such as this manual, are for information purposes only.

Kartheiser never received a copy of the H.R. Manual or this disclaimer, nor was he ever aware that the manual existed. Although maintained in the human resources office, the H.R. Manual was never distributed to Kartheiser or other employees.

A second policy manual, the Engineering Office Manual, was a compilation of various policies and procedures that American Can had adopted over the years. At least one copy of this manual was maintained in the Engineering Office where Kartheiser worked. This manual was made available for Kartheiser's use, and contained the overtime policy at issue in this action.² As Maintenance Department Supervisor, Kartheiser oversaw payment of employees under the overtime policy. The Engineering Office Manual does not contain a disclaimer. At some point, a third manual, known as the "Flexible Packaging Policies and Procedures Manual," was distributed to employees, including Kartheiser. This manual contains neither a disclaimer nor a policy regarding overtime premium pay.

II. Summary Judgment Standard

"[S]ummary judgment is an extreme remedy, and one which is not to be granted unless the movant has established his right to a judgment with such clarity as to leave no room for controversy and that the other party is not entitled to recover under any discernible circumstances." Robert Johnson Grain Co. v. Chemical Interchange Co., 541 F.2d 207, 209 (8th Cir. 1976) (citing Windsor v. Bethesda General Hospital, 523 F.2d 891, 893 n. 5 (8th Cir. 1975)). The purpose of the rule is not "to cut litigants off from their right of trial by jury if they really have issues to try," Poller v. Columbia Broad. Sys., Inc., 368 U.S. 464, 467, 82 S.Ct. 486, 7 L.Ed.2d 458 (1962) (quoting Sartor v. Arkansas Natural Gas Corp., 321 U.S. 620, 627, 64 S.Ct. 724, 88 L.Ed. 967 (1944)), but to avoid "useless, expensive and time-consuming trials where there is actually no genuine, factual issue remaining to be tried," Anderson v. Viking Pump Div., Houdaille Indus., Inc., 545 F.2d 1127, 1129 (8th Cir. 1976) (citing Lyons v. Board of Educ., 523 F.2d 340, 347 (8th Cir.1975)).

The plain language of Federal Rule of Civil Procedure 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. See Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Summary judgment is properly granted when the record, viewed in the light most favorable to the nonmoving party and giving that party the benefit of all reasonable inferences, shows that there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. See Fed. R.Civ.P. 56(c); Harlston v. McDonnell Douglas Corp., 37 F.3d 379, 382 (8th Cir. 1994). The Court does not weigh the evidence nor make credibility determinations; rather the Court only determines whether there are any disputed issues and, if so, whether those issues are both genuine and material. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986); Wilson v. Myers, 823 F.2d 253, 256 (8th Cir.1987) ("Summary judgment is not designed to weed out dubious claims, but to eliminate those claims with no basis in material fact.") (citing Weight Watchers of Quebec, Ltd. v. Weight Watchers Int'l, Inc., 398 F.Supp. 1047, 1055 (E.D.N.Y.1975)).

The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact based on the pleadings, depositions, answers to interrogatories, admissions on file, and affidavits, if any. See Celotex, 477 U.S. at 323, 106 S.Ct. 2548; Anderson, 477 U.S. at 248, 106 S.Ct. 2505. Once the moving party has carried its burden, the nonmoving party must go beyond the pleadings and, by affidavits or by the depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial. See Fed. R.Civ.P. 56(c), (e); Celotex Corp., 477 U.S. at 322-23, 106 S.Ct. 2548; Anderson, 477 U.S. at 257, 106 S.Ct. 2505. An issue is "genuine," if the evidence is sufficient to persuade a reasonable jury to return a verdict for the nonmoving party. See id. at 248, 106 S.Ct. 2505.

III. Analysis

Kartheiser claims in this suit that the overtime policy contained in the Engineering Office Manual constituted an enforceable contract between American Can and himself. American Can, on the other hand, claims in its Motion for Summary Judgment that the policy is not an enforceable contract. American Can further claims that a disclaimer contained in its H.R. Manual prevented the Engineering Office Manual overtime policy from becoming an enforceable contract. In evaluating whether the Engineering Office Manual overtime policy and the H.R. Manual disclaimer are binding on American Can and Kartheiser, this Court follows the Iowa courts in applying the theory of unilateral contract.

A. Whether the Overtime Policy Establishes an Enforceable Contract

Kartheiser claims that American Can's Engineering Department Manual established a contract that he would be compensated for overtime work. To establish a contract under Iowa law, a handbook or manual must meet the requirements for a unilateral contract. Thompson v. City of Des Moines, 564 N.W.2d 839, 844 (Iowa 1997); Anderson v. Douglas & Lomason Co., 540 N.W.2d 277, 283 (Iowa 1995); Hunter v. Board of Trustees, 481 N.W.2d 510,...