Pearson v. Rohn Indus., Inc.

Charles Pearson, Appellant, v. Rohn Industries, Inc., et al., Respondents.

A15-0477

STATE OF MINNESOTA IN COURT OF APPEALS

December 21, 2015

This opinion will be unpublished and may not be cited except as provided by Minn. Stat. § 480A.08, subd. 3 (2014).

Affirmed

Cleary, Chief Judge

Stearns County District Court

File No. 73-CV-12-7130

Nicholas G. B. May, Jenny M. Helling, Fabian May & Anderson, PLLP, Minneapolis, Minnesota (for appellant)

Susan D. Thurmer, Robyn K. Johnson, Cousineau McGuire Chartered, Minneapolis, Minnesota (for respondents)

Considered and decided by Cleary, Chief Judge; Connolly, Judge; and Johnson, Judge.

UNPUBLISHED OPINION

CLEARY, Chief Judge

Appellant Charles Pearson seeks review of the district court's denial of his motion for post-trial relief. Appellant asserts that the district court erred by (1) applying incorrect legal standards to his claims of age discrimination and reprisal under the Minnesota Human Rights Act (MHRA); (2) denying his constitutional right to a jury trial; (3) denying his motion to compel discovery of recorded statements; and (4) considering evidence that was not properly admitted at trial. Appellant further argues that the cumulative effect of these errors requires a new trial. We affirm.

FACTS

Pearson's claims of age discrimination and reprisal are associated with his period of employment at respondent Rohn Industries, Inc., a business that provides document and IT destruction and recycling services. Pearson was hired in March 2009 as a salesperson for Shred Right, Rohn's shredding-and-destruction-services division. He had previously worked in sales for over ten years at Shred-It, one of Rohn's competitors in the shredding-services industry.

The parties dispute some key facts surrounding Pearson's hiring at Rohn's Shred Right division. The district court found that after he left his job at Shred-It, Pearson contacted respondent James R. Beran, a sales manager for Rohn. The district court found that Pearson told Beran that "he was bored with his retirement and he wanted to sell shredding services again." Pearson met with Beran and respondent Ronald V. Mason Jr., the sole owner of Rohn, on multiple occasions to discuss the possibility of being hired at Rohn. The district court found that, during these discussions, Pearson stated that he would generate $1 million in annual sales for Shred Right. As a result of Pearson's representation, Mason offered Pearson a base salary guarantee of $96,000, which was substantially higher than salaries of other non-management-level sales staff at Shred Right. In a pre-trialmotion, Pearson denied saying that he would generate $1 million in sales if hired at Shred Right. Pearson also denies telling Beran and Mason that he had retired from Shred-It, when in fact he was fired from his job there. The district court credited the testimony of respondents Mason and Beran, who testified that Pearson said only that he had retired.

In 2009, Pearson fell substantially short of generating $1 million in sales. In the spring of 2010, Mason told Beran that Rohn would have to fire Pearson unless Pearson substantially increased his sales. Beran met with Pearson in April 2010 for Pearson's first annual review and stated that Pearson needed to improve his job performance. In September 2010, respondent Donald Drapeau became President of Shred Right. Mason tasked Drapeau with reforming the division's compensation structure in order to increase Rohn's profitability. To that end, Drapeau developed a Points System Plan that would reduce employees' base-salary guarantees. Management implemented the Points System Plan on January 1, 2011, resulting in a 30% reduction in Pearson's base salary. But by September 2011, Drapeau and Mason determined they were not satisfied with the plan. Beran and Drapeau began working on a new plan to be implemented in 2012. As of December 2011, Mason, Beran, and Drapeau had decided to decrease Pearson's salary to $50,000, effective March 1, 2012, in order to better align Pearson's salary with the sales revenue he was generating. The district court credited testimony that the standard base-salary guarantee in the shredding industry is 10% of sales revenue generated.

On January 5, 2012, Drapeau asked Pearson out to lunch with the intent to ask Pearson about his retirement plans, as Drapeau knew that Pearson's 65th birthday was approaching. At this time, Pearson did not know that respondents had decided to reducehis salary to $50,000. Drapeau testified that he had known Pearson since 1999, from working with him before they were both at Rohn, and that by asking Pearson about his retirement plans, he was hoping to get information he could use to potentially "soften[ ] the blow" of the pay cut. Drapeau stated that he thought that management might be able to avoid cutting Pearson's salary if Pearson were intending to retire soon, or if he wanted to opt for a part-time position.

During their discussion at lunch, Pearson stated that he did not intend to quit working. Drapeau told Pearson that Mason believed Pearson's salary was too high. The district court found that Drapeau then asked Pearson whether Pearson could collect Social Security payments, and Pearson said he was not interested in taking the payments yet because he thought he would have to pay a penalty. The district court found that Drapeau then asked Pearson, "Well, you have enough money, don't you?"

On January 10, 2012, Beran notified Pearson that his base-salary guarantee would be reduced to $50,000, effective March 1, 2012. The district court found that Pearson was upset about the pay cut, that he exhibited hostility toward respondents in the workplace, that he told other employees that he would not accept the salary reduction, and that he was stunned and humiliated by the cut. The district court credited the testimony of respondents, several employees at Shred Right, and Pearson's wife on this point. During the week prior to February 6, 2012, Pearson went to Beran's office and confronted him about who would get commissions on a new account Pearson had been working on acquiring. In what became a heated exchange, Pearson brought up his salary reduction and Beran raised the issue of Pearson's claim that he would make $1 million in sales. After this interaction withPearson, Beran immediately went to Mason and the two agreed that Pearson should be fired. They decided to delay any action on it until Drapeau returned from vacation on February 6.

Pearson vigorously contests the facts the district court found regarding events of February 6, 2012. The parties agree that Pearson sent Mason an e-mail on the morning of February 6. The timestamp on the e-mail shows that Pearson sent it at 8:41 a.m. In the message, Pearson describes the conversation he had with Drapeau at lunch and states that he believes his salary has been unlawfully reduced on the basis of his age. Mason testified that he forwarded the e-mail to his attorney at 9:33 a.m. Mason and Beran met with Drapeau when he arrived at the office that morning and told him about the confrontation between Beran and Pearson that had occurred the week before. They told Drapeau that they had decided to fire Pearson. The district court credited respondents' testimony that they did not open Pearson's e-mail before the meeting and therefore did not consider it in their decision to fire Pearson.

On February 7, 2012, Beran and several Rohn staff members attended a meeting with Pearson to inform him that he was being fired. Beran provided Pearson with a termination letter stating that Pearson was being fired due to his failure to make the sales he had promised he would when he was hired, and because Pearson's salary was much higher than the salaries of comparable or higher-performing salespeople at the company. The letter also cited Pearson's negative reaction to the salary reduction as a reason he was being fired. Right after the meeting, Beran and the operations manager in attendance at the meeting both documented their recollection that when Pearson was told he was being fired,he said he was surprised it hadn't happened "last week." The majority of Pearson's accounts were transferred to Beran, who was 48 years old at the time.

Pearson commenced this action against respondents, alleging age discrimination in violation of MHRA, Minn. Stat. § 363A.08, subd. 2 (2012) and Minn. Stat. § 181.81 (2012), and reprisal in violation of MHRA, Minn. Stat. § 363A.15 (2012).¹ Pearson moved for a trial by jury on all claims and raised a constitutional question regarding enforcement of the MHRA bench-trial requirement. The district court found for respondents after a bench trial, and Pearson moved for amended findings of fact, conclusions of law, and judgment, or in the alternative, a new trial. The district court considered Pearson's argument concerning the right to a jury trial and his motion for post-trial relief, and subsequently denied his motion to amend or for a new trial. This appeal followed.

DECISION

Age discrimination and reprisal claims

Pearson argues that the district court's factual findings regarding his age discrimination and reprisal claims were clearly erroneous. Pearson also contends that the district court erred in applying the law to those facts.

No deference is given to a district court's determinations on questions of law. Modrow v. JP Foodservice, Inc., 656 N.W.2d 389, 393 (Minn. 2003). But this court givesgreat deference to a district court's findings of fact, and will not set them aside unless they are clearly erroneous. Minn. R. Civ. P. 52.01. "Findings of fact are clearly erroneous only if the reviewing court is left with the definite and firm conviction that a mistake has been made. If there is reasonable evidence to support the trial court's findings of fact, a reviewing court should not disturb those findings." Fletcher v. St. Paul Pioneer Press, 589 N.W.2d 96, 101 (Minn. 1999) (quotation and citations omitted). Appellate courts also...