Iverson v. Deco Prods. Co.

STEVEN IVERSON, Plaintiff, v. DECO PRODUCTS COMPANY, LLLP, Defendant.

No. 19-CV-2008-KEM

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF IOWA EASTERN DIVISION

January 22, 2020

MEMORANDUM OPINION AND ORDER

Plaintiff Steven Iverson brought suit against his former employer, Defendant Deco Products Company, LLLP, (Deco Products) after Deco Products terminated Iverson's employment the same day that a female employee made a sexual-harassment complaint against him. Doc. 5. He alleged several causes of action, including breach of contract based on an employee handbook and age and sex discrimination in violation of Iowa and federal law. Id. Deco Products now moves for summary judgment on all of Iverson's claims. Docs. 17, 19, 23. Iverson resists. Doc. 18. I find that Deco Products is entitled to summary judgment on all of Iverson's claims and thus grant the motion (Doc. 17).

I. BACKGROUND

The following facts are recited in the light most favorable to Iverson, the nonmoving party. Deco Products is a hot injection molding company that makes specialty molded parts for its customers. Def. App. 18.¹ Iverson worked for Deco Products in the early 1980s as an inspector, and after taking classes in mechanical engineering at a community college, he began working for Deco Products in 1989 building and repairing molds. Def. App. 18, 29; Pl. App. 41.

In 2014, a female coworker made a complaint to Deco Products about Iverson. See Def. SOF ¶ 10; Pl. Resp. SOF ¶ 10.² According to Iverson, he and the coworker were friendly, and he saw that she was having a bad day toward the end of the day on a Friday, so he walked up to her, put his hands on her hips, and said something along the lines of, "hang in . . . there, we're almost done." Pl. App. 23-25. After discussing the incident with her mother over the weekend, the female coworker complained to the Human Resources department. Pl. App. 26. Iverson was called in for a meeting with Human Resources and management about the incident, and he was told to keep his hands to himself. Pl. App. 27. He was given a written Employee Warning Notice, which categorizes the violation as "misconduct" and "harassment" and describes the incident as follows: "Swatted female employee on the bottom when she was at fountain. Unwelcome verbal or physical conduct of condescending nature - harassment. Employee has found this to be offensive along with witnesses." Def. App. 5. Iverson signed the notice sheet. Id.; Pl. App. 27. The notice indicates it is the "1^st + Final" warning and states that "Failure to correct violation may result in termination." Id. There is also a handwritten notation on the notice that Iverson was told that "if he ever touched inappropriately again[,] he would be terminated," (id.) but Iverson testified at his deposition he did not remember being told that during the meeting or reading that when he signed the notice (Def. App. 28).

On July 19, 2017, another female coworker made a complaint about Iverson. Def. SOF ¶ 12; Pl. Resp. SOF ¶ 12. She told Human Resources that when she was in the break room washing her hands around 11:00 a.m., Iverson came up behind her to get his food out of the microwave and "swatted her behind." Id.; Def. App. 15. She stated thatthis was not the first time Iverson "had done this same thing to her." Def. App. 15. That same day at around 1:30 p.m., Iverson met with two of his supervisors and a woman from Human Resources in a conference room. Def. App. 21; Pl. App. 41. When he walked into the room, Iverson saw a pink slip of paper on the table that he recognized as a termination slip, and the sexual harassment complaint that had been made against him earlier in the day was discussed. Def. App. 20-21. Iverson explained that he had touched the woman by accident: when he was reaching for the microwave door, she took a step back, and his hand accidentally brushed her rear end. Def. App. 20-21; Pl. App. 41. Iverson had never seen the woman before that day, and neither of them said anything when he accidentally touched her. Pl. App. 19-20, 28, 41. Iverson explained his side of the story at the meeting "several times," and he testified at his deposition that there was nothing else he wished he would have said.³ Def. App. 28; Pl. App. 20-22. He asked whether he could be suspended for three days instead of terminated, and he was informed that the decision to terminate him had already been made. Pl. App. 42. When he left the meeting, Iverson knew that his employment had been terminated and that his termination was "because of th[e] incident" with the female coworker. Pl. App. 21.

At the time of his termination, Iverson was fifty-six years old. Pl. App. 41. He was replaced by a younger employee. Pl. App. 41. The only comment ever made to Iverson about his age occurred about a year before his termination. Pl. SOF ¶ 14; Def. Resp. SOF ¶ 14; Def. App. 30-31. A fellow toolmaker was showing two people around the tool room and told Iverson, "they're your replacements." Def. App. 30-31. The coworker who made this comment was on the same level as Iverson and not his supervisor, but he was good friends with Iverson's boss. Id. Iverson told his boss about the comment and asked if he was being replaced. Id. Iverson's boss made the coworkerapologize to Iverson, and the coworker explained that he had been kidding and did not mean anything by the comment. Id.

Over the years during his employment with Deco Products, Iverson received employee handbooks. Iverson signed a form indicating he had received the employee handbook in 1981 and 1989. Def. App. 6-7. Iverson testified at his deposition (in response to a question asking whether he had an opportunity to review an employee handbook while working at Deco Products) that "[i]f a person ever had a question, we were always given a handbook as they did updates." Def. App. 26; Pl. App. 29. He further stated that "[e]ach employee from what I believe got their own copy of any updated material." Def. App. 26. Iverson stated that he kept a copy of the employee handbook in his toolbox at work. Def. App. 26. The 2016 version of the employee handbook was in effect at the time of Iverson's termination. Def. App. 3. There is a place for an employee to sign and acknowledge receipt of the handbook (Def. App. 14), but no record of Iverson's signature exists. The general manager for Deco Products submitted an affidavit stating that Iverson was provided a copy of the 2016 version of the handbook and that he was not required to sign an acknowledgement of receipt of the handbook. Def. App. 3-4. Iverson did not cite to any evidence rebutting that he did not receive the 2016 version of the handbook. See Pl. Resp. SOF ¶ 3; Pl. App. 41-42 (Iverson does not deny receiving the 2016 version of the handbook in his affidavit).

Iverson initiated this lawsuit in December 2018. See Doc. 5. Iverson alleged five counts: (1) breach of contract based on the employee handbook; (2) age and sex discrimination under state and federal law; (3) "retaliatory discharge in violation of public policy"—for this count, Iverson did not allege that he engaged in any protected activity, but rather that Deco Products violated public policy by terminating him without following the procedure in the employee handbook, by failing to conduct a thorough investigation of the sexual-harassment complaint, by terminating his employment without good cause, and by discriminating against older male workers; (4) negligence based on Defendant'sfailure to follow the employee handbook and conduct a thorough investigation of the sexual-harassment complaint; and (5) disability discrimination under state and federal law. Id. Deco Products moves for summary judgment on all counts. Docs. 17, 23. Iverson concedes Deco Products is entitled to judgment as a matter of law on his disability-discrimination claim but resists summary judgment on all other counts. Doc. 18 at 2.

II. DISCUSSION

Under Federal Rule of Civil Procedure 56(a), "[t]he court shall grant [a motion for] summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." For the plaintiff to avoid summary judgment, sufficient evidence must exist "on which the jury could reasonably find for the plaintiff." Olmsted v. Saint Paul Pub. Sch., 830 F.3d 824, 828 (8th Cir. 2016) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986)). The court "view[s] the record in the light most favorable to the nonmoving party and draw[s] all reasonable inferences in that party's favor." Soo Line R.R. Co. v. Werner Enters., 825 F.3d 413, 418 (8th Cir. 2016) (quoting Bishop v. Glazier, 723 F.3d 957, 960-61 (8th Cir. 2013)).

A. Breach of Contract Based on the Employee Handbook

For his first cause of action, Iverson alleges breach of contract under Iowa law based on the provisions of an employee handbook. Under Iowa law, "employment relations are presumed to be at-will," and "if no employment contract exists, either party may terminate the relationship for any lawful reason at any time." Jones v. Lake Park Care Ctr., Inc., 569 N.W.2d 369, 374-75 (Iowa 1997). An exception to this general rule occurs "when an implied contract of employment is created by a handbook oremployee policy manual guaranteeing that discharge will occur only under certain circumstances." Id. at 375.

"The key to determining whether a contract has been created [by an employee handbook] is whether a reasonable employee upon reading the handbook would believe they had been guaranteed certain protections by their employer." Id. The existence of an offer (as required to form a unilateral contract) is determined objectively, not subjectively. Anderson v. Douglas & Lomason Co., 540 N.W.2d 277, 285 (Iowa 1995). Iowa courts consider the language of the provisions of the employee handbook when determining whether it constitutes an offer:

(1) Is the handbook in general and the progressive disciplinary

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