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March 10, 2000


The opinion of the court was delivered by: McMAHON, District Judge.


Plaintiff, Nancy Kosakow, was an x-ray technologist employed by Defendant, New Rochelle Radiology Associates, P.C. ("Practice"), from 1978 to 1997. In March 1997, while Plaintiff was on medical leave from her job, the Practice notified her that it was terminating her position. Plaintiff brings this suit against her former employer claiming: (1) that failure to reinstate her in her job or one similar upon the end of her medical leave was in violation of Section 102 the Family and Medical Leave Act of 1993 ("FMLA"), 29 U.S.C. § 2615; and in the alternative, (2) even if the termination did not violate FMLA, Defendant is liable for severance pay under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1132(a)(1)(B).

Defendant moves for summary judgment to dismiss both claims on the grounds that (1) Ms. Kosakow was not an "eligible employee" within the meaning of FMLA (as construed through application of "hours worked" standards of the Fair Labor Standards Act ("FLSA")) and was therefore not entitled to the benefits of FMLA; or, in the alternative (2) the Practice did not violate FMLA because it eliminated Ms. Kosakow's position for legitimate business reasons; and (3) that Ms. Kosakow's ERISA claim must be dismissed because the Practice does not have an ERISA Severance Plan, and is therefore not subject to ERISA liability.

Ms. Kosakow argues that the Practice's motion for summary judgment should be denied. She claims that she meets eligibility requirements of FMLA as incorporated from the FLSA "hours worked" standards, and argues that are material issues of facts concerning whether the Practice terminated her in violation of her right to be reinstated to her job following medical leave. She further argues that material issues of fact exist as to whether the Practice maintained an ERISA Severance Plan.

For the reasons stated below, Defendant's motion for summary judgment dismissing the FMLA claim is granted. Because I hold that the Practice maintained an Severance Plan within the meaning of ERISA, I remand the severance claim back to the Practice for a ruling by the Plan Administrator.

I. Factual Background

The following are the undisputed facts, viewed in a light most favorable to the Plaintiff:

Defendant New Rochelle Radiology Associates, P.C. ("Practice"), is a professional medical corporation that provides a wide range of radiological services, (including MRI, radiation oncology, ultrasound, x-ray, mammography and CT-scans) to patients in the upper Bronx and lower Westchester County area of New York state. It provides services at two separate offices in New Rochelle: 150 Lockwood Avenue and at 175 Memorial Highway.

Plaintiff Nancy Kosakow began employment at the Lockwood Avenue office of the Practice as a licensed x-ray technologist in 1978. Ms. Kosakow was note certified to perform any other perform any other procedures, although in the mid-1970s, prior to her work at the Practice, she had performed some mammography. The Practice classified her position as part time, and she worked, on average, 28 hours per week.

On June 6, 1996, Ms. Kosakow underwent an ultrasound administered by Dr. Leonard Cutler, a physician/shareholder of the Practice. The ultrasound revealed a pathological cystic mass on her left ovary. Follow-up exams on July 12 and November 13, 1996 revealed that the mass had not diminished. On November 13, 1996, Dr. Isaiah Seligman, also a physician/shareholder of the Practice, advised Ms. Kosakow that the mass was potentially dangerous and that she would require surgery to remove it. A few days after her consultation with Dr. Seligman, Ms. Kosakow arranged to have surgery performed on January 14, 1997.

After she scheduled the surgery, Ms. Kosakow informed Gale Gluss, Office Manager for the Practice since 1991, that she required medical leave for the surgery. January 10, 1997, was Ms. Kosakow's last day of scheduled work at the Practice. On January 14, the surgery was performed and Ms. Kosakow began her recovery.

On March 7, 1997, while she was still on leave, Ms. Kosakow was informed by a letter from Adele Gargano, the Practice Administrator, that her x-ray technologist position at the Practice's 150 Lockwood Avenue office was "being eliminated due to overstaffing." (Def's Exh. 1.) In the same letter, the Practice offered to Ms. Kosakow the opportunity to continue working as a technologist on a per diem "as needed" basis. (Id.)

According to Defendant, Ms. Kosakow's position was eliminated as a result of a recommendation from the Practice's independent accountant, Roger Berman, that the Practice should look for ways to reduce unnecessary payroll expenses. (Berman Decl. ¶. 5-8.) Mr. Berman made this recommendation following a severe cash flow crisis in the Practice in September 1996, which he believed would create serious operational problems for the Practice. (Id. at 8-12.)

In October 1996, Ms. Gargano and Ms. Gluss started looking at the needs of the Practice at its Lockwood Avenue location and the responsibility of each employee at that office, with an eye to cutting costs. After reviewing that information, Ms. Gargano determined that Ms. Kosakow was the least essential technologist in the office. Her conclusion was based on three factors: (1) Ms. Kosakow was one of only two part-time technologists; (2) Ms. Kosakow was restricted to performing x-ray procedures and was not cross-trained for any other radiology modality (i.e. mammography and bone density radiology); and (3) Ms. Kosakow's performance evaluation was inferior to the other part-time technologist's evaluation. (Gargano Decl. at ¶ 14-19; Gluss Decl. at ¶ 31-45.)

Ms. Gargano reported her recommendations at an Executive Meeting of the Practice on November 14, 1996. Ms. Gargano averred that her recommendation to the Practice's shareholders, and the shareholders' subsequent decision to eliminate Ms. Kosakow's position, was made without any knowledge of Ms. Kosakow's need for surgery or her intent to take medical leave. She delayed informing Ms. Kosakow of the job termination, as the shareholders decided to make staff reductions after the new year in order to avoid staff morale problems. After the holidays, out of her stated concern for Ms. Kosakow's well being, Ms. Gargano decided to delay notifying Ms. Kosakow until after her recovery. (Gargano Decl. ¶¶ 21, 21.) As soon as she learned that Ms. Kosakow was ready to return to work, she wrote to her notifying her that the position had been eliminated. (Id.)

Ms. Kosakow rejected the Practice's offer of per diem work. She filed disability and discrimination claims with the New York State Department of Human Rights ("SDHR") and the Federal Equal Employment Opportunity Commission ("EEOC"). The gravamen of her complaint to the SDHR was that the Practice eliminated her position as a result of her medical disability in violation of the Americans with Disabilities Act of 1990 ("ADA"), 42 U.S.C. § 12101, et seq. and the New York human Rights Law ("NYHRL"), N Y Exec. Law § 296. In response to her complaints with these two offices, the Practice filed an Answer and Narrative Reply defending its decision as based on the economic factors discussed above. Ms. Kosakow filed a rebuttal, in which she admitted that the financial reasons were part of the decision, but that other, impermissible considerations — namely, her surgery — had also prompted the elimination of her position.

The SDHR reviewed the case and determined that there was "no probable cause to believe that [the Practice] has engaged in or is engaging in the unlawful discriminatory practice complained of." (Def's Exh. 6.) The SDHR determination was grounded in three express findings of fact: (1) "Because of financial losses incurred by [the Practice] measures were taken to reduce expenses including a reduction in force"; (2) the Practice's only other part-time technologist employee "was cross-trained in bone density and was working on her own towards her Mammography Certification [and] was retained [instead of Ms. Kosakow], although she had less seniority, because of her qualifications"; and (3) Ms. Kosakow "was only certified as an x-ray Technician and was the only employee in both offices who was not cross-trained." (Id.) The SDHR thus concluded that "the record does not support complainant's charge that she was terminated because of her disability." (Id.)

The SDHR's finding was adopted by the EEOC on October 13, 1998 as part of its "right to sue" letter. (Def's Exh. 7.) Ms. Kosakow's 90-day time period for filing federal lawsuit based on the EEOC letter expired on January 1999. Ms. Kosakow failed to file such an action. Ms. Kosakow also chose not to appeal the SDHR's decision by bringing an Article 78 proceeding in New York State Supreme Court.

After the time to file a disability suit under the EEOC "right to sue" letter and to file an appeal under Article 78 had expired, Ms. Kosakow commenced the instant action, alleging that her termination violated FMLA and ERISA. (Id. at Exh. 8).

II Discussion of the Law

Plaintiff brings a claim against the Practice for its failure to return her to her same, or an equivalent, position following her protected medical leave of absence, in violation of Section 102 of FMLA, 29 U.S.C. § 2615. In the alternative, Ms. Kosakow alleges that the Practice failed to pay her severance benefits in violation of ERISA, 29 U.S.C. § 1132(a)(1)(B). She seeks injunctive relief in the form of reinstatement of her job and/or damages.

Summary judgment is appropriate where there are no genuine issues of material fact and the movant is entitled to judgment as a matter of law. See Fed. R.Civ.P. 56(c); see Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-50, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A genuine issue for trial exists if, based on the record as a whole, a reasonable jury could find in favor of the non-movant. See Liberty Lobby, 477 U.S. at 248, 106 S.Ct. 2505. In making its determination, the court must resolve all ambiguities and draw all reasonable inferences in favor of the non-movant. See id. at 255, 106 S.Ct. 2505. However, to defeat summary judgment, the non-moving party must go beyond the pleadings and "must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986).

A. Plaintiff's FMLA Claim

The FMLA was enacted because Congress believed "there is inadequate job security for employees who have serious health conditions that prevent them from working for temporary periods. . . ." 29 U.S.C. § 2601(a)(4). "Congress enacted substantive provisions entitling eligible employees to temporary leave, to certain continuing benefits, and to reinstatement . . . and made it `unlawful for any employer to interfere with, restrain, or deny the existence of or the attempt to exercise, any right provided under [subchapter I of the Act].'" Sarno v. Douglas-Elliman, 183 F.3d 155, (2d Cir. 1999) (quoting 29 U.S.C. § 2615(a)(1)). Employers may not "use the taking of FMLA leave as a negative factor in employment actions, such as hiring, promotions or disciplinary actions." 29 C.F.R. § 825.220(c). FMLA tries to accomplish these goals "in a manner that accommodates the legitimate interests of employers." 29 U.S.C. § 2601(b)(3). Any eligible employees affected by such unlawful conduct are entitled to a private right of action for damages or equitable relief. See 29 U.S.C. § 2617(a)(1).

In her Complaint, Plaintiff seeks relief under Section 2615 of the FMLA, which reads in relevant part:

(a) Interference with Rights

(1) Exercise of Rights

It shall be unlawful for any employer to interfere with, restrain, or deny the exercise of or the attempt to exercise, any right provided under this subchapter.

29 U.S.C. § 2615(a)(1).

FMLA thus creates an entitlement and, at the same time, "provides protection in the event an employee is discriminated against for exercising those rights." Hodgens v. General Dynamics Corp., 144 F.3d 151, 159 (1st Cir. 1998). Thus, if an employer denies an eligible employee the same or similar employment upon returning from FMLA leave, the employer is in violation of the FMLA. See 29 C.F.R. § 825.220(b).*fn1 Plaintiff's claim here is that by eliminating her job while she was on medical leave, her former employer violated, interfered with or denied her the exercise of her rights under FMLA. (Complaint ¶ 23.)

A prima facie case under FMLA requires Plaintiff to show that (1) she is an "eligible employee" as defined in 29 U.S.C. § 2611(2); (2) the Practice is an "employer;" (3) she was entitled to medical leave as a result of a serious health condition; and (4) she gave adequate notice to the Practice of her intention to take leave, as defined in 29 U.S.C. § 2612(e)(1). See Slaughter v. American Building Maintenance Co. of N.Y., 64 F. Supp.2d 319 (S.D.N.Y. 1999). In addition, a plaintiff must show that she is entitled to the benefit she is claiming was denied her. See Belgrave v. City of New York, 1999 WL 692034 at *43 (E.D.N Y 1999).

Here, the parties have stipulated that the Practice is an employer within the meaning of FMLA and that Ms. Kosakow was entitled to leave. (Frumkin Decl., ¶ 6, Exh. 15). As Defendants have failed to dispute the issue of notice, I assume for the purposes of this motion, that Ms. Kosakow gave adequate notice of her intent to take medical leave. (Kosakow Aff. ¶ 12). The only elements that are disputed are the questions of whether Ms. Kosakow is an "eligible employee" within ...

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