Vesprini v. Shaw Industries, Inc., CIV.A. 00-11311-NG.
| Decision Date | 03 May 2002 |
| Docket Number | No. CIV.A. 00-11311-NG.,CIV.A. 00-11311-NG. |
| Parties | Armando VESPRINI, Plaintiff, v. SHAW INDUSTRIES, INC. and Shaw Contract Flooring Services, Inc., Defendants. |
| Court | U.S. District Court — District of Massachusetts |
Richard L. Yospin, Simons & Marcus, Brighton, MA, for Armando Vesprini, Plaintiff.
Allison B. Kaplan, Allison K. Romantz, Morgan, Brown & Joy, Boston, MA, for Shaw Contract Flooring Services Inc, Shaw Industries Inc., Defendants.
MEMORANDUM AND ORDER RE: SUMMARY JUDGMENT
Plaintiff Armando Vesprini ("Vesprini") brings this case under the federal Age Discrimination in Employment Act ("ADEA"), 42 U.S.C. § 621 et seq., the Massachusetts Fair Employment Practices Act, Mass. Gen. Laws ch. 151B ("ch. 151B"), Massachusetts1 law of breach of contract, and Massachusetts common law of constructive discharge. The case raises important questions concerning the meaning of "direct evidence" of age discrimination — what kinds of comments qualify, by whom, when?
In 1997, Vesprini sold his company, Circle Floors, Inc. ("Circle") to the defendants, Shaw Industries ("Shaw") and Shaw Contract Flooring Services ("SCFS"), and received an Employment Agreement which he believed protected his position and compensation as head of Circle Floors for a three-year period. At the time of the sale Vesprini was seventy-one years old.
The three-year period following that sale, however, was difficult for Vesprini. According to him, after the Circle Floors purchase, and particularly after Shaw merged Circle with another flooring company, Continental, Shaw executives marginalized and humiliated him because of his age. They made comments about his age and limited future with the company, even though he was a vigorous seventy-one-year-old and his company had been successful. After the sale, they refused to give him his due as CEO of Circle Floors, and effectively forced him out of the office. As a result, he claims to have lost bonuses and suffered emotional distress.
The defendants tell a different story: Shaw purchased Circle with an eye to integrating it into a larger network of flooring contractors. Consistent with this plan, Vesprini's employment contract was a short-term one, only three years in duration. As in the case of any purchase of an ongoing business, the old employees had to adjust to the new regime. Vesprini simply refused to acclimate to his necessarily more limited role as part of a larger organization or to take direction from Shaw. His failure to adapt to the changes gave rise to employee complaints that Shaw executives could not ignore, culminating in an episode in which Vesprini used profanity and was disruptive. Even then, Shaw did not formally terminate him or invoke the punitive provisions of the contract: They just let his contract run out.
Defendants have moved for summary judgment, claiming that Vesprini has failed to create a triable issue of material fact as to any of his claims. For the reasons stated below, Defendants' Motion for Summary Judgment [docket entry # 29] is hereby GRANTED.
The following are the facts, viewed in the light most favorable to Vesprini: Vesprini opened and incorporated Circle Floors, Inc. ("Circle Floors"), a commercial flooring business, as its president and sole shareholder in 1960. His son, Michael Vesprini ("Michael"), came to work for Circle Floors in 1985, and Vesprini eventually made Michael a vice president of the company; in 1996, Vesprini gave Michael 40% of the company's shares.
Also in 1996, Jay Houston ("Houston"), on behalf of defendant Shaw, approached Vesprini to inquire as to whether he would be interested in selling Circle Floors to Shaw. Both Vesprini and his son testified that they understood that the sale would have little to no impact on how they ran the business; Shaw told them that they would be allowed to continue conducting what had been a profitable and successful business in the same manner as before. Accordingly, Vesprini and Houston eventually agreed on a purchase price of approximately $7.2 million, to be paid in the form of Shaw stock, and the sale was concluded in early April 1997. At the time of the sale, as discussed above, Vesprini was seventy-one years of age.
On April 4, 1997, Vesprini entered into an Employment Agreement with Circle Floors, now owned by Shaw. The agreement provided that Vesprini would be employed as president of Circle Floors for a period of three years, or until April of 2000. It also provided, inter alia, that Vesprini would be paid annual compensation of $207,000; that he would be eligible to participate in the normal benefit programs of Circle Floors, in accordance with the terms and requirements of each plan or program; and that he would also be eligible to receive an incentive bonus payment in accordance with a bonus plan currently in effect and attached to the agreement.2
The agreement did not enumerate Vesprini's duties with any specificity. All it said was that during his three-year term of employment, Vesprini "shall devote his entire time and effort, during assigned working periods, to the tasks Circle shall assign him." The Agreement also contained a covenant not to compete, which provided that Vesprini would not engage in business activities competitive with Circle Floors during the period of his employment by Circle.
Finally, the Employment Agreement contained provisions regarding termination. Specifically, it provided that Circle Floors had the right to terminate Vesprini prior to the termination of the three-year contract, either for good cause3 or otherwise. If Vesprini were to be terminated for good cause, he would forfeit all rights to any further compensation, payments, or benefits under the contract, and Circle would have no further obligations under the contract. If Circle were to terminate Vesprini for reasons other than good cause, however, Vesprini would be entitled to continue to receive his base salary, but not the bonus for the fiscal year (or portion thereof) during which the termination occurred.
In addition to the Employment Agreement and the attached Bonus Agreement, Vesprini later signed a Standards of Ethical Conduct Agreement.4 This agreement provided, in relevant part, that "[a]ny use of vulgar or unprofessional language on company premises or at any time while engaged in the performance of company duties is strictly prohibited," and that "failure to abide by this Agreement may be grounds for the termination of my employment without any further notice and without any requirement for progressive discipline."
From Shaw's perspective, the Circle Floors acquisition was only one part of a larger plan to acquire commercial flooring businesses in the Boston area, with a view to building up a national network of flooring contractors that would function on a region-by-region basis. In 1997, Houston hired 41-year-old Scott Mahan ("Mahan") to, inter alia, analyze the Boston flooring market and assess how Shaw should proceed. After spending some time on research in the Boston area, Mahan reported that there was counterproductive competition between two flooring companies that Shaw had acquired: Circle Floors, the company employing Vesprini, and Continental Carpets ("Continental"), which it had purchased around the same time. Accordingly, sometime in the fall of 1997, Shaw assigned Mahan the task of overseeing the merger of the two companies, along with Shaw's regional mill-based operation. That merger plainly had the potential to affect the responsibilities of employees in each company, including Vesprini.
In October 1997, Vesprini and his son, Michael, were invited to attend a meeting at Shaw's headquarters in Dalton, Georgia, at which Mahan and Houston were also present. The meeting is significant for Vesprini because of what he claims was said to him about his role. Houston informed Vesprini and his son about the forthcoming merger between Circle Floors and Continental. Houston explained that Mahan would come to Boston to serve as the president of the consolidated business, Shaw Contract Flooring Services/New England ("SCFS/New England"), and would be responsible for its day-to-day operations, that Michael Vesprini would serve as its vice president, and that Vesprini would continue to serve as Chief Executive Officer of Circle Floors.
The parties agree that Houston told Vesprini that he envisioned Vesprini's role as that of a mentor/advisor to Michael and Mahan, helping them to learn the business and providing them with the benefit of his years of experience and contacts. Vesprini and Houston also agree that, when Vesprini asked Houston to clarify who would be "the boss," Houston told him repeatedly that he, Vesprini, would be.5
The parties disagree, however, as to what else was said. Specifically, Vesprini claims that in the course of describing his new role as mentor to Mahan and Michael, Houston told him, that he should step back and "let the young stallions run the business" and that it was "time to smell the flowers". Vesprini also claims that Houston and Mahan told him that he was "not going to be here much longer," and that they suggested that he spend more time at his house in Florida6 "taking it easy" and playing golf. Houston and Mahan testified that they did not recall making these statements. Vesprini testified that he interpreted these comments as not-too-subtle hints that he should retire because of his age.
In the period of time between this meeting and January 1998, the defendants claim that various Shaw employees reported complaints and rumors regarding Vesprini to Mahan, including allegations that Vesprini was speaking negatively about Shaw and Mahan, that he was interfering with the Continental merger, and that he had told various sales people, vendors, and customers that he was considering opening up his own business to compete with Shaw. Mahan reported these problems to Houston....
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