Nelson v. Long Lines Ltd.
| Decision Date | 15 September 2004 |
| Docket Number | No. C02-4083-MWB.,C02-4083-MWB. |
| Citation | 335 F.Supp.2d 944 |
| Parties | Philip NELSON, Plaintiff, v. LONG LINES LTD., a South Dakota Corporation, and Charles Long, in his individual capacity, Defendants. |
| Court | U.S. District Court — Northern District of Iowa |
Michael J. Carroll, Coppola, Sandre, McConville & Carroll, PC, West Des Moines, IA, Steve G. Heikens, Minneapolis, MN, for Plaintiff.
Margaret M. Prahl, Heidman Redmond Fredregill Patterson Plaza Dykstra & Prahl, Sioux City, IA, for Defendants.
TABLE OF CONTENTS
I. INTRODUCTION AND BACKGROUND ..........................................950
A. Procedural Background .............................................950
B. Factual Background ................................................951
II. LEGAL ANALYSIS .......................................................954
A. Standards For Summary Judgment ....................................954
1. Requirements of Rule 56 ........................................954
2. The parties' burdens ...........................................954
3. Summary judgment in employment discrimination cases.............955
B. Nelson's ADEA Claim ...............................................956
1. The direct evidence paradigm ...................................956
2. Nelson's direct evidence .......................................958
a. The speaker .................................................959
b. The content .................................................959
c. The causal link .............................................960
3. The circumstantial evidence paradigm ...........................960
a. Nelson's prima facie case ...................................962
b. Nelson's showing of pretext .................................963
C. Nelson's Fair Labor Standards Act Claim ...........................964
1. Requirements of FSLA ...........................................965
2. Single enterprise under FSLA ...................................965
a. Related activity ............................................965
b. Common control or unified operations ........................966
c. Common business purpose .....................................966
D. Breach Of Implied Covenant Of Good Faith And Fair Dealing..........967
E. Promissory Estoppel ...............................................968
F. Unjust Enrichment .................................................971
III. CONCLUSION ...........................................................972
On September 19, 2002, Philip Nelson filed a complaint in this court against his former employer, defendant Long Lines, Ltd. ("Long Lines") and Charles Long, the owner of Long Lines, alleging five causes of action: (1) a claim of age discrimination in violation of the Age Discrimination in Employment Act of 1967 ("ADEA"), 29 U.S.C. § 621 et seq.,; (2) a claim for unpaid overtime compensation under the overtime pay provisions of the Fair Labor Standards Act ("FLSA"), 29 U.S.C. § 201 et seq.; (3) a pendent state law claim for breach of the covenant of good faith and fair dealing; (4) a pendant state law claim for promissory estoppel; and (5) a pendent state law claim for unjust enrichment.
Defendants have filed a Motion for Summary Judgment on all of Nelson's claims. First, in their motion, defendant Long contends that the ADEA claim against him must be dismissed because there is no individual liability for age discrimination under the ADEA. Defendant Long Lines contends that Nelson's ADEA claim must be dismissed because Nelson cannot establish a prima facie case of age discrimination and there is no evidence of pretext sufficient to create a jury issue. With respect to Nelson's FLSA claim, defendant Long Lines asserts that the underlying entity which employed Nelson, Manhattan Beach, Inc., is not an "enterprise engaged in commerce" under the FLSA and therefore the overtime requirements of the FLSA do not apply to it. Alternatively, defendant Long Lines asserts that because of Nelson's supervisory role at the resort, he was not entitled to receive overtime pay. Defendants also seek summary judgment on Nelson's claim of breach of the covenant of good faith and fair dealing during his employment on the ground that this claim is not recognized by Iowa law. Alternatively, defendants contend that the conduct complained of was not bad faith conduct required for such a claim. With regard to Nelson's claim of promissory estoppel, defendants assert that Nelson's proof on this issue must fail as a matter of law because the alleged promise was not sufficiently definite and Nelson's reliance occurred prior to the making of any promise. Finally, defendants seek summary judgment on Nelson's unjust enrichment claim found in Count V on the ground that Nelson was told not to use his personal equipment in the performance of his work duties. Nelson has filed a timely resistance to defendants' Motion for Summary Judgment, arguing that there are genuine issues of material facts in dispute regarding all of his claims.
Subject matter jurisdiction over Nelson's federal claim is proper pursuant to 28 U.S.C. § 1331 (federal question). The court has jurisdiction over the state law claim alleging violations of Iowa common law pursuant to 28 U.S.C. § 1367(a), which confers "supplemental jurisdiction over all claims that are so related to the claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution." 28 U.S.C. § 1367(a).
The summary judgment record reveals that the following facts are undisputed. Philip Nelson was born on October 3, 1939. In the Spring of 1996, Nelson was hired by Charles ("Chuck") Long to work at Manhattan Beach Resort. At the time, Nelson worked for Village West Resort at Lake Okoboji, Iowa. Nelson had been originally hired by Long Lines, Inc. to work at Village West Resort, which Long Lines owned. Long Lines also owned another resort in the same area, Manhattan Beach Resort. Long Lines is an Iowa corporation whose function is to own the stock of its subsidiary corporations and to handle some administrative functions for them. Long Lines is the sole shareholder of Manhattan Beach, Inc., which was incorporated on November 30, 1999. Prior to that date, Manhattan Beach Resort had been operated as a division of Long Lines. Manhattan Beach, Inc. is a separate corporation from Long Lines and is located at Wapheton, Iowa, about 100 miles from Sergeant Bluff, Iowa, where Long Lines is located. Manhattan Beach, Inc. has never had more than $500,000 in total annual income. Long Lines provided payroll services for Manhattan Beach, Inc. under an arrangement whereby Manhattan Beach reimbursed Long Lines for such services.
In 1996, Long Lines sold Village West Resort. Nelson was told by Long that when the ownership of Village West Resorts was separated from Manhattan Beach Resort that Nelson could work at Manhattan Beach Resort. Manhattan Beach Resort is a resort whose business is to provide recreational housing by renting units to customers. Manhattan Beach Resort is owned by Manhattan Beach, Inc. All of the houses and units at Manhattan Beach Resort were part of the resort property including those occupied by Mr. and Mrs. Chuck Long and his sister. On February 16, 2000, Nelson signed an Employee Acknowledgment Form in which he indicates that he was an at will employee of Long Lines.
Nelson was responsible for taking care of the entire facility. Nelson was designated the resort supervisor, worked without direct supervision, and no one told him what work to do at the resort on a day-to-day basis. Nelson made hiring decisions and determined the number of employees that were needed. He arranged for the placement of advertisements for summer help. Nelson hired two or more employees for the summer season and directed their work by telling them what to do and where he wanted them to work on a daily basis. Nelson kept track of the workers' time and sent the time sheets to the corporate office for processing but he did not fax his hours to Long Lines. Nelson contacted, hired and supervised the cleaning service. He told the cleaning service where they needed to clean. Nelson also monitored the facilities and arranged for service people to make repairs where needed. Nelson contacted the carpet cleaning service each year and obtained towels and bedding from a laundry service. He also made arrangements with a plumber for the installation of drains. In addition, Nelson obtained quotes from contractors for the repair of sidewalks at the resort. On a few occasions, Nelson contacted a tree service to remove trees from the resort. Nelson also looked into the costs for housekeeping staff as part of management's consideration of changing the basis of rentals to nightly or weekly. No one ever told Nelson that he had to work more than eight hours a day and he never requested authorization to hire additional help. Chuck Long believes that he never asked Nelson to do anything that he would not have done himself.
Chuck Long made the decision to fire Nelson, in consultation with his Chief Financial Officer, Tom Grimsley. Charles Long was 58 years of age when he decided to fire Nelson. Grimsley carried out the task of telling Nelson that he was fired. Nelson was 61 years of age at the time of his termination on May 2, 2001. Long's stated reason for firing Nelson was because the resort did not need a manager and because of poor work performance. Nelson remembers that...
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