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Paolillo v. Dresser Industries Inc.

decided: January 4, 1989.


Appeal from judgment entered after a jury trial by the United States District Court for the District of Connecticut, Alan H. Nevas, J., in favor of employer in age discrimination action.

Feinberg, Meskill and Kearse, Circuit Judges.

Author: Feinberg

FEINBERG, Circuit Judge.

This case is before us for the second time. The ultimate issue is whether defendant-appellee Dresser Industries, Inc., through its Whitney Chain Division, violated the Age Discrimination in Employment Act, 29 U.S.C. ยงยง 621-634 (ADEA), by implementing an "elective termination program," pursuant to which plaintiffs-appellants Dominic Paolillo, Lucy Wadsworth and Robert Grady ended their employment with Whitney Chain. On the prior appeal, in June 1987 we reversed a grant of summary judgment by the United States District Court for the District of Connecticut, and remanded for trial. In our prior opinion, with which we will assume the reader is familiar, we made clear that the key issue at trial should be whether plaintiffs had retired voluntarily. 821 F.2d 81. On this appeal from a judgment for defendant, after a trial, we reluctantly again reverse for reasons given below.


The relevant facts are as follows. In October 1982, in the midst of a significant business decline, Whitney Chain, a unit of Dresser Industries' Power Transmission Division of its Industrial Equipment Group, offered an elective termination program to all its employees age 60 and over. Whitney Chain instituted the program as a means of reducing costs and offered severance pay and other benefits to employees who agreed to retire early. The program was first announced on Tuesday, October 12, 1982, at a meeting between James Fiorino, Whitney Chain's Operations Manager, and employees eligible for the program. It was called on five minutes notice. Appellants Wadsworth and Grady attended this meeting. Appellant Paolillo was not at work that day and did not meet with Fiorino until the next day, at which time Paolillo apparently was given the same information that the other eligible employees had received.

At the October 12 meeting, Wadsworth and Grady were presented with a letter stating that Whitney Chain was instituting an overall cost reduction plan because of its economic problems and outlining the basic options available under the elective termination program. The letter stated that participation in the program was "totally voluntary" and emphasized to the employees that "you must return your election form . . . by October 18," six days later. Whitney Chain concedes that important insurance and financial information was not provided at the meeting. The letter stated that "meetings will be held to answer any questions and review pension options." Grady met with company representatives on the afternoon of Friday, October 15 to discuss how the program would affect him individually and signed the election form on Monday, October 18, the final day for decision.

There is some dispute over whether Whitney Chain representatives ever met with Paolillo and Wadsworth to discuss relevant pension and insurance information. Appellants claim that the two employees never had a meeting and were forced "to make their decisions on Monday, the 18th, without knowing what their retirement benefit or pension options were." Whitney Chain contends that a representative of the company met with all eligible employees to review the pension information and, in any case, all eligible employees were given printed individualized pension information along with an explanation booklet. Paolillo signed the election form on Monday, October 18, and the election form signed by Wadsworth was dated October 15 and stamped received on October 18.

By accepting early retirement Paolillo received severance pay of $608.88 per month for two years, Wadsworth $388.75 per month for two years and Grady a lump sum of $13,390. At the time, they were earning $29,226, $18,660 and $26,757 a year, respectively. Appellants claim that they would have been better off if they had remained on the company payroll and received their salaries rather than accepting a retirement into which they were unduly pressured. The retirements became effective on November 1, 1982. Paolillo had been employed by Whitney Chain for about 16 years, Wadsworth 15 years and Grady 31 years. The Whitney Chain plant ultimately shut down on October 31, 1984.

After our remand, the case was tried to a six-person jury in May 1988 before Judge Alan H. Nevas of the United States District Court for the District of Connecticut. Before trial, the district court granted two motions in limine. The first excluded appellants' proposed expert testimony on the coercive nature of the elective termination program, and the second excluded appellants' proposed evidence concerning lost unemployment compensation and social security benefits. The court also denied a motion by appellants to exclude evidence relating to the permanent closing of the Whitney Chain plant on October 31, 1984.

After the denial of these motions, the district court gave its charge to the jury, using the familiar McDonnell Douglas standard.*fn1 The jury deliberated for one and a half hours and returned a verdict for Whitney Chain. The court thereafter entered judgment in favor of appellee, and this appeal followed.


In our prior opinion, we held that summary judgment for Whitney Chain had been improper because the combination of the shortness of time given to appellants to make a decision, the reason for the compressed time period, the length of service of appellants with Whitney Chain and the apparent complexity of the options open to them raised a material issue as to whether appellants were given sufficient time to make a considered choice. 821 F.2d at 84. We recognized, however, that "on a full record Whitney Chain may ultimately be successful on the issue of whether appellants in fact acted voluntarily." Id. at 85. We also noted some of the facts called to our attention by Whitney Chain that, if proved at trial, might persuade a jury to reach that result, such as "appellants' failure to ask for additional time and to express their dissatisfaction with the short deadline, and their signature on a statement affirming that the choice to retire was freely made," along with the possibility that the pressure appellants felt "was caused by the uncertain future of Whitney Chain," rather than by "the method of implementation" of the retirement plan. Id. at 84.

A jury has now heard all the evidence and has found for Whitney Chain. However, we conclude that we cannot simply affirm, although we are tempted to do so because we do not want to put the parties to the expense and effort of another trial in a case whose outcome seems reasonably predictable. Nevertheless, we believe that we must ...

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