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Berndt v. Kaiser Aluminum & Chemical Sales

May 6, 1986

CARL F. BERNDT
v.
KAISER ALUMINUM & CHEMICAL SALES INC., APPELLANT IN NO. 85-1488; CARL F. BERNDT V. KAISER ALUMINUM & CHEMICAL SALES INC. CARL F. BERNDT, APPELLANT IN NO. 85-1518



On Appeal from the United States District Court for the Eastern District of Pennsylvania (D.C. No. 82-3931)

Author: Mansmann

Before: HUNTER and MANSMANN, Circuit Judges and BROTMAN, District Judge*fn*

MANSMANN, Circuit Judge.

In these cross-appeals*fn1 after a jury verdict for the plaintiff in this case brought pursuant to Section VII of the Age Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et seq., we are asked to review, inter alia, two issues which have not yet been squarely dealt with by our court: 1) whether the district court is required to re-examine the elements of the plaintiff's initial prima facie case in ruling upon post-trial motions; and 2) whether unemployment compensation payments should be eliminated from the total amount of damages subject to pre-judgment interest. Because we find that the district court applied the correct legal standards in denying the post-trial motions and in including the unemployment compensation benefits in the amount subject to pre-judgment interest and finding no merit in any of the other allegations raised, we will affirm the district court in all respects.

I. Procedural and Factual Circumstances

The plaintiff, Carl F. Berndt (Berndt), filed an amended complaint in this action alleging that he was unlawfully discharged from Kaiser Aluminum & Chemical Sales, Inc. (Kaiser) on account of his age during a reduction in labor force by Kaiser and additionally, that his discharge constituted a breach of contract.

The district court severed the contract action from the ADEA claim for purposes of trial. The jury returned a verdict on liability in favor of Mr. Kaiser on the ADEA claim. The jury specifically found that age was a determinative factor in Kaiser's termination of the plaintiff and that the termination was willful. Summary judgment was granted by the court in favor of Kaiser on the contract claim.

By agreement of the parties, the issue of damages was submitted to the district court upon a stipulated set of facts which established the monetary value of certain items claimed as damages by Mr. Berndt. The court entered judgment for actual damages in the amount of $139,881.95. Deciding that the issue of willfulness had been improperly submitted to the jury, the district court did not award liquidated damages. The district court also determined that an award of prejudgment interest as well as an award of six months' front pay was appropriate. Berndt thereupon filed a Motion for Judgment Notwithstanding the Verdict or the New Trial which was denied.

According to the stipulated facts, Mr. Berndt was born on June 19, 1923. He was employed by Kaiser at age 50 as a sales representative and worked in Kaiser's Eastern Region of the Building and Construction Products Division from November 22, 1973 until his termination, effective August 31, 1981. In December 1980, Mr. Berndt became a senior sales representative with Kaiser.

Prior to August 1981, Kaiser sold three product line in its Eastern Region: Mobile Homes Products, Agricultural Roofing Products, and Highway Products. As a result of the difficult economic conditions existing in the industry, Kaiser made a decision to eliminate its Agricultural Roofing Product line, effective December 1981; to reduce its Mobile Homes Product line; and to close its Lancaster, Pennsylvania manufacturing plant. This cutback in products necessitated the reduction of the Eastern Region sales force from six to four salesmen.

During this time there were six salesmen in the Eastern Region who were assigned to specific product lines. The region was divided among the six by geographic territory. The men included Homer (Michael) Foote, assigned to Agricultural Roofing; Frank Papso, assigned to Mobile Home Products; Paul Dean, assigned to Highway Products, Mobile Home Products and Fabricated Products; Jack Fisher, assigned to Highway Products, Mobile Home Products and Agricultural Roofing Products; James C. Hannah, assigned to Highway Products and Agricultural Roofing; and Carl Berndt, assigned to Highway Products.

In May 1981, Michael Venie, Regional Sales Manager for Kaiser's Eastern Region of the Building and Construction Product Division recommended to George Novotny, Division Manager, that Mr. Berndt be terminated and not be considered for a transfer to another job. Mr. Novotny presented Mr. Berndt's name for layoff to the corporate Personnel Committee. On August 31, 1981, Mr. Berndt was terminated by Kaiser. At the time of his termination, Mr. Berndt was 58 years old and was the oldest Highway Products salesman in the Building and Construction Division of Kaiser's Eastern Region.

II. Kaiser's Appeal

A. Burden of Proof

Kaiser maintains that Mr. Berndt failed to sustain his burden of proof in several respects: namely, 1) that Mr. Berndt failed to prove that he was qualified for one of the four remaining sales positions following the acknowledged labor force reduction; 2) that Mr. Berndt failed to prove that he was less favorably treated than younger employees; 3) that Mr. Berndt failed to prove that age was a determinative factor in Kaiser's decision to terminate him; and 4) that Mr. Berndt failed to prove that Kaiser intentionally discriminated against him on account of his age.

The ADEA makes it unlawful for an employee "to discharge an individual . . . because of such individual's age." 29 U.S.C. § 623(1). In order to recover under the ADEA, a plaintiff must prove by a preponderance of the evidence that age was a determinative factor in the employer's decision. Duffy v. Wheeling Pittsburgh Steel Corp., 738 F.2d 1393, 1395 (3d Cir.), cert. denied, 469 U.S. 1087, 105 S. Ct. 592, 83 L. Ed. 2d 702 (1984). Because the allocation of proof in an ADEA case,*fn2 similar to the allocation of proof under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 200(e), McDonnell Douglas Corp. v. Green, 411 U.S. 792, 36 L. Ed. 2d 668, 93 S. Ct. 1817 (1973), has been set forth on numerous occasions by this court, we turn directly to the procedural problem this case presents.

The defendant's first two allegations regarding burden of proof focus upon whether or not Mr. Berndt has made out a prima facie case while his last two allegations are concerned with whether or not Mr. Berndt has met his ultimate burden of proving that age was "a determinative factor" in the employer's decision. See Smithers v. Bailar, 629 F.2d 892 (3d Cir. 1980).

Under the McDonnell Douglas approach, the plaintiff has the initial burden of establishing a prima facie case of unlawful discrimination by a preponderance of the evidence. This is accomplished in a reduction-in-force case, such as before us, by the plaintiff showing "that he is a member of the protected class and that he was laid off from a job for which he was qualified while others not in the protected class were treated more favorably." Massarsky v. ...


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