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MUNN v. MARINE MIDLAND BANK

September 13, 1996

LAWRENCE A. MUNN, Plaintiff,
v.
MARINE MIDLAND BANK, N.A., Defendant.



The opinion of the court was delivered by: HECKMAN

 This case has been referred to the undersigned by Hon. Richard J. Arcara for all pretrial matters and to hear and report on dispositive motions, pursuant to 28 U.S.C. § 636(b). Defendant moves for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. For the reasons that follow, it is recommended that defendant's motion be granted in part and denied in part.

 BACKGROUND

 The complaint in this action was filed on April 15, 1993 seeking damages and injunctive relief based on the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. § 621 et seq., New York Human Rights Law, N.Y. Exec. Law § 290 et seq., and common law theories of breach of employment contract and fraudulent inducement. Plaintiff alleges that, on January 27, 1992, defendant Marine Midland Bank ("Marine") discharged him from his position as Executive Vice President, Real Estate Industries Division ("REID"), because of his age.

 The following facts are not in dispute. Plaintiff was born on June 9, 1942. He worked at Citicorp/Citibank from approximately 1972 through early 1991, eventually attaining the title of Executive Vice President and Senior Credit Officer at a salary of approximately $ 125,000.00 annually (Item 15, Ex. A). In approximately October, 1990, plaintiff authorized Brooks Griffin, an executive recruiter (or "headhunter"), to make inquiries about the availability of employment at a financial institution in the Buffalo area (Item 17, P 3). Mr. Griffin eventually contacted Simon Martyn, Marine's Executive Vice President for Group Human Resources, and negotiations took place during February and March of 1991 concerning plaintiff's possible employment at Marine (id., PP 4-6).

 On March 26, 1991, Mr. Martyn faxed Mr. Griffin a draft "offer letter" in which various proposals for the terms of plaintiff's employment were set forth as "a basis for discussion only . . ." (Item 13, Ex A). The cover memorandum accompanying the draft letter stated:

 
It is definitely our intention to engage [plaintiff] on a longterm career basis, and if our future real estate portfolio does not provide sufficient scope for someone of [his] talents and experience, we shall seek to progress him by building on his general credit and managerial expertise. We are not however prepared to offer a formal "golden parachute" arrangement; our intention is to become the most successful regional bank in the USA, and [plaintiff] must buy into that vision, accepting the inevitable residual risk which is inherent in any business venture.

 (id.).

 By letter dated April 5, 1991, Mr. Martyn extended a formal offer to plaintiff for the position of Executive Vice President, Loan & Asset Management, at a base salary of $ 190,000.00 (Item 13, Ex. B). The offer letter contained essentially the same terms as the March 26, 1991 draft letter, along with additional terms regarding facilitation of plaintiff's relocation from Plano, Texas to the Buffalo area. The formal offer letter also contained the following paragraph:

 
In the event your employment with Marine is terminated through no fault of your own, before you are vested in the Marine Midland Pension Plan, the bank will purchase an annuity or otherwise guarantee a benefit for the period of time you were with Marine based on the pension benefit formula in effect at the time of your termination. This is in addition to any severance benefit you would be entitled to under the policy at the time of your termination.

 (id.).

 By letter dated April 10, 1991, plaintiff accepted Mr. Martyn's formal offer of employment "as outlined in [the] letter dated April 5, 1991" (Item 13, Ex. C). Thereafter, by letter dated April 12, 1991, Mr. Martyn advised plaintiff that an addendum to the April 5, 1991 offer letter had been authorized by which defendant agreed "that in the event [plaintiff's] employment with Marine is terminated for reasons other than cause, [plaintiff] will be entitled to receive a severance benefit of a minimum of six months pay" (Item 13, Ex. D).

 Subsequently, as a result of a recently created vacancy, Mr. Martyn offered plaintiff the position of Executive Vice President, REID, at a base salary of $ 200,000.00 (Item 13, Ex. E). In a memorandum dated May 2, 1991 to David Penketh, Marine's Chief Credit Officer, Mr. Martyn recommended that plaintiff be accepted for employment in this position (Item 13, Ex. F). The recommendation memorandum also noted that plaintiff would report directly to Brian Robertson, Executive Vice President, Special Credits (id.).

 Plaintiff commenced his employment at Marine on June 3, 1991, six days prior to his 49th birthday. During the time he was employed by Marine, the United States Office of the Comptroller of the Currency ("OCC") conducted an audit of REID. In an internal memorandum dated October 18, 1991, from Mr. Penketh and Marine's Executive Director Keith R. Whitson, the general conclusions of the OCC audit were reported as "positive" (Item 15, Ex. F). According to the memorandum, several of REID's previous problems had been "effectively addressed by management" (id.).

 Thereafter, in an internal memorandum to Mr. Penketh dated January 24, 1992, Mr. Robertson expressed his "concerns over plaintiff's performance to date and [his] conclusion that [plaintiff] is the wrong man for the job" (Item 14, Ex. E). Mr. Robertson stated:

 
In essence, plaintiff's impact upon the division has been, at best, neutral, and he has failed to live up to expectations. I question whether his contribution to the institution has been, or ever will be, commensurate with his cost to it. Whilst he is a likeable fellow and I have absolutely nothing against him personally, I must conclude that we made a mistake employing him and should now let him go.

 (id.).

 A similar recommendation was made by Mr. Martyn in an internal memorandum dated January 24, 1992, to Mr. Whitson. Mr. Martyn stated:

 
Your final approval is now needed to . . . terminate plaintiff's employment. This is obviously a hard decision in view of the career sacrifices and domestic upheaval he incurred to join us last year, but at his seniority/salary level we simply cannot afford to carry "dead wood."
 
* * *
 
Under the terms of plaintiff's engagement we shall have to pay him 6 month's severance. This is quite usual in the case of mid-career recruitment at this level, in view of the obvious risks to the executive concerned. I believe we should proceed as we are contractually obliged to do, and not seek to avoid payment on performance grounds; this is not what is locally termed a severance "for cause."

 (Item 20, Ex. B).

 In the same memorandum, Mr. Martyn also recommended the appointment of "Bob Engel as plaintiff's successor in REID" (id.). Following some discussion about "the controversial area" of this appointment with respect to Mr. Engel's history with Marine and his ability to "meet the very demanding managerial requirements" of the position, Mr. Martyn recommended the following:

 
Appoint Engel to the post, but re-evaluate it at the Grade H (SVP) level. This is realistic in view of the general structure of REID and its status as a gradually self-liquidating business. It also avoids some of the problems of perception which would otherwise surround a rather controversial appointment.

 (id.). At the bottom of this memorandum, Mr. Whitson wrote the following note to Mr. Martyn:

 
Thanks for laying this out so succinctly. Although deeply regrettable I believe Robertson's/your recommendations are the correct ones and accordingly give my approval.

 (id.).

 On January 27, 1992, slightly less than eight months after commencing his employment with Marine, plaintiff's employment was terminated. He was 49 years old. *fn1"

 Marine moves for summary judgment dismissing the age discrimination, fraudulent inducement and breach of employment contract claims against it. Oral argument on this motion was held before the undersigned on June 3, 1996. For the reasons that follow, it is recommended that the motion be granted to the extent it ...


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