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Hay v. Burns Cascade Co.

February 18, 2009

WENDY J. HAY, PLAINTIFF,
v.
BURNS CASCADE CO., INC, DAVID S. BURNS, DAVID MONAHAN, DAVID DOING, AND TIMOTHY MURPHY, DEFENDANTS.



The opinion of the court was delivered by: Norman A. Mordue, Chief U.S. District Judge

MEMORANDUM-DECISION AND ORDER

INTRODUCTION

Plaintiff Wendy J. Hay was employed by defendant Burns Cascade Co., Inc. ("Burns Cascade") from 1980 until she was terminated on July 26, 2005. In the complaint, plaintiff seeks damages claiming that defendants violated Title III of the Omnibus Crime Control and Safe Streets Act of 1968, 18 U.S.C. § 2510-2520, the federal wiretapping statute. Specifically, plaintiff alleges that defendants illegally intercepted, disclosed and used plaintiff's private and personal telephone communications. Plaintiff also alleges that she was wrongfully terminated from her employment with Burns Cascade due to the unlawful use of information derived from illegal wiretapping and eavesdropping.*fn1 Presently before the Court is defendants' motion (Dkt. No. 25) pursuant to Fed. R. Civ. P. 56(c) seeking summary judgment and dismissal of plaintiff's complaint.

FACTUAL BACKGROUND*fn2

I. The Parties

The facts in this case, unless otherwise noted, are undisputed.*fn3 Burns Cascade was a distributor of manual, actuated and control valves, as well as instruments, pipe and related products. Burns Cascade's headquarters was located at 400 Leavenworth Avenue, Syracuse, New York. Defendant David S. Burns ("Burns") was the Chief Executive Officer and principal shareholder of Burns Cascade. Defendant David Monahan ("Monahan") was President of Burns Cascade.*fn4 Defendant David Doing ("Doing") was the IT Manager for Burns Cascade.

Defendant Timothy Murphy ("Murphy") was Director of Customer Service.*fn5

From 1980 until July 26, 2005, plaintiff was employed by Burns Cascade. Plaintiff was originally employed in the contracting department and later became a Customer Service Representative in the Syracuse office.*fn6 As a customer service representative, plaintiff reported to Jane Catchpole (previously known as Jane Hammerstedt)*fn7 , David Pollock*fn8 and Murphy.*fn9

In February 2005, plaintiff requested a change in her schedule and asked Lynn Stacjer if she could work "flextime". Plaintiff testified that Ms. Stacjer made the request but that it was denied. Plaintiff conceded that she was unhappy with the decision. In April 2005, Burns Cascade announced a series of organizational and managerial changes. Of relevance to plaintiff was the promotion of her former co-worker, Murphy, to the position of Customer Service Manager. With that transition, plaintiff became one of Murphy's direct reports. Plaintiff was unhappy with that change and made negative comments about defendants and its management team, specifically Murphy and Monahan. Plaintiff communicated her concerns to Lynn Stajcer and Mr. Pollock. Plaintiff also made derogatory comments about Murphy to Renee Leggett, the Human Resource Manager. Some of plaintiff's derogatory comments were made during telephone calls from plaintiff's office telephone. At the time plaintiff was terminated, plaintiff reported to Murphy.

II. The Telephone System

In 1995, Burns Cascade purchased a new central telephone system, known as the AXXESS system, to upgrade telecommunications. Burns Cascade retained EC Hunter & Associates to provide consultation in connection with the new system. The telephone system was manufactured by Inter-Tel, Inc. and purchased from Internal Telecommunications System, Inc. (also known as ITS). The system contained features entitled UCD (Uniform Call Distribution) Hunt Groups and ACD (Automatic Call Distribution) Hunt Groups. With these features, Burns Cascade could create "hunt groups" to segregate personnel and customer service by product family. The hunt group divisions routed telephone calls in a manner so that each employee received the same amount of calls. Moreover, if a call came into the office when a employee was not logged onto the telephone system, the call would automatically transfer to the next available agent in that assigned hunt group. Burns Cascade created hunt groups for customer service, the warehouse and purchasing.

The AXXESS system also contained a built-in call monitoring feature which permitted hunt group supervisors to monitor the telephone calls of individuals in a specified hunt group. The AXXESS Installation and Maintenance Manual, Issue 5.3, June 2001 provided as follows*fn10

UCD Hunt Group Supervisors and Station Monitoring

6.32 The Station Monitor feature allows hunt group supervisors to monitor the calls of anyone in a specified hunt group. It can be useful in training or in evaluating the performance of hunt group members.

NOTE: As a courtesy, hunt group members should be notified in advance that their calls may be monitored. In addition, a programmable option can be enabled that sends a tone to the station being monitored whenever the hunt group supervisor joins an ongoing call. (Note that call monitoring may be illegal in some locations. It is up to the end user to ensure that use of this feature is in compliance with local laws).

6.33 In database programming, each hunt group can have one or more stations assigned as the hunt group supervisor(s). The supervisor must reside on the same node as the hunt group members. The supervisor is usually not a member of the hunt group. If the supervisor is a member of the hunt group, the Hunt Group Remove/Replace feature can be used at any time without affecting the Station Monitor ability. If desired, one station can be assigned as the supervisor for more than one hunt group.

6.34 To monitor a hunt group member's call, the supervisor enters the Station Monitor feature code (321) and dials an extension number. The supervisor is then connected to the call and can hear both parties, but cannot be heard by either one.

If the monitored call is terminated, transferred, or placed on hold by the hunt group member, the monitor function is terminated.

Defendants' employees did not receive a copy of the manual. The employees were not told by defendants or any supervisors/managers that their telephone calls could be or would be monitored.

Ms. Catchpole, the Corporate Manager for Customer Service and Procurement, and David Doing provided testimony with regard to the telephone system. Ms. Catchpole was part of a selection committee that examined different telephone companies and systems. After the system was installed, Doing became the telephone systems administrator.*fn11 Doing testified that as the telephone system administrator, he was responsible for adding and moving phone extensions, troubleshooting, programming the auto attendant feature, adding/removing individuals from hunt groups and running reports. Doing testified that when he assumed those duties, Ms. Catchpole was the only hunt group supervisor with station monitoring capability.

According to Doing, the system contained programming software which permitted him to add or delete hunt group supervisors. The software allowed him to open a hunt group icon that displayed the various hunt groups, members of the group and their extensions. From this icon, Doing could add or remove individuals. The software for station monitoring was located in an unlocked closet on the first floor in the purchasing area. Doing also had the programming software for monitoring on his office computer. Doing testified that he was the only person in the company who knew how to utilize the station monitoring software. There was no pre-recorded message indicating that a call "may be monitored for quality control purposes" and no tone or other signal indicating that a call was being monitored.

Doing testified that while he was employed with Burns Cascade, the only individuals with station monitoring capability, at various times, were himself, Ms. Catchpole and Monahan. Ms. Catchpole testified that she was capable of listening to employee telephone calls from the time the system was installed until she was terminated in 2002. Ms. Catchpole stated that she could only monitor calls from her office and that she only monitored the customer service hunt group. Ms. Catchpole claimed that she monitored "dozens" of plaintiff's personal and business calls. Ms. Catchpole could not recall when those calls were intercepted or the sum and substance of any of those calls. In 2002, Doing monitored two or three telephone calls between Ms. Catchpole and Mr. Pollock. Monahan utilized the monitoring system on one occasion, July 21, 2005.

The witnesses disagree on the purpose of the monitoring system. Ms. Catchpole testified that she was directed to monitor employee calls by Mr. Pollock, "to uncover activities or conversations that could be harmful to Burns Cascade, professionally or personally". Doing testified that the monitoring feature was not for quality control but used for "specific instances", e.g., whether certain individuals were conspiring or whether an employee was being sexually harassed. Both Monahan and Mr. Pollock testified that the purpose of the monitoring was to ensure customer service effectiveness.

III. Code of Conduct

On February 28, 2000, Burns Cascade distributed a document to their employees entitled "Code of Conduct & Sexual Harassment Policy".*fn12 The Code of Conduct reads, in pertinent part:

The following is an outline of Burns Bros. policies and procedures:

9. For business purposes, management reserves the right to enter, search and/or monitor the private company voice mail, email system, the files/transmission of any employee without advance notice. All information in the Voice mail, E-Mail and electronic data base system is the property of the Company and should not be considered private or secure for any employee.

The Code of Conduct also contains the following clause:

I agree to abide by Burns Bros. policies and procedures. I understand that neither this communication nor any other written or verbal communications by a management representative is intended to, in any way, create a contract of employment. I also understand that Burns Bros. abides by employment-at-will, which permits the Company or the employee to terminate the employment relationship at any time, for any reason. Burns Bros. will not modify their policy of employment-at-will in any case.

The Code was distributed to employees with an accompanying Memorandum from Renee Leggett, the Human Resources Manager. The Memorandum read as follows:

In an effort to avoid any misunderstanding, the Company has developed a Code of Conduct. Under cover is your copy of Burns Bros. Code of Conduct and Sexual Harassment Policies. Please complete the bottom of this memo, with your signature and date. This will acknowledge, that you have received and read both the Code of Conduct and Sexual Harassment Policies. Please return this Memo to me, after you have signed and date it, as soon as possible. If you have any questions regarding the above, please contact me.

Ms. Leggett testified that the purpose of the Code was to inform the employees that the telephones and the internet were for business purposes. On March 2, 2000, ...


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