Stewart v. Mut. Wheel Co.

EUGENE STEWART, Plaintiff,

v.MUTUAL WHEEL COMPANY, Defendant.

No. 09-CV-1050-LRR

UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF IOWA

EASTERN DIVISION

DATED: March 17, 2011

ORDER

TABLE OF CONTENTS

I. INTRODUCTION....................................... 2

II. RELEVANT PROCEDURALHISTORY........................ 2

III. SUBJECT MATTERJURISDICTION......................... 2

IV. SUMMARY JUDGMENTSTANDARD......................... 3

V. RELEVANT FACTUALBACKGROUND....................... 3

A. Players.........................................4

B. 2002 Golf Outing...................................4

C. 2007 Scrap MetalConflict............................. 6

D. Reimbursement Conflict.............................. 7

E. First AnonymousLetter.............................. 8

F. Second AnonymousLetter.............................9

G. Plaintiff's Meetings with Butler BenefitServices..............9

H. Engstrom Brothers'Investigation....................... 10

I. Plaintiff's Termination.............................. 11

J. Mutual Wheel's Prior TheftExperience................... 12

VI. ANALYSIS.......................................... 12

A. Remaining Evidentiary Issue.......................... 12

B. ADEA and ICRA.................................. 13

C. Plaintiff's Prima FacieCase.......................... 15

D. Mutual Wheel's Legitimate Non-DiscriminatoryReason........ 17

E. Pretext......................................... 18

1. ADEA claim................................ 19

2. ICRA claim................................. 19

VII. CONCLUSION....................................... 20

I. INTRODUCTION

The matter before the court is Defendant Mutual Wheel Company's ("Mutual Wheel") "Motion for Summary Judgment" ("Motion") (docket no. 18).

II. RELEVANT PROCEDURAL HISTORY

On October 13, 2009, Plaintiff Eugene Stewart filed a Petition and Jury Demand ("Complaint") (docket no. 4) in the Iowa District Court for Dubuque County, case no. 0311LAC056273. Plaintiff alleges that Mutual Wheel discriminated against him by "terminating his employment because of his age, " in violation of the Age Discrimination in Employment Act of 1967 ("ADEA"), 29 U.S.C. § 621, et seq., and the Iowa Civil Rights Act of 1965 ("ICRA"), Iowa Code § 216.1, et seq. Complaint at ft 15, 23.

On November 9, 2009, Mutual Wheel removed the action to this court on the basis of both federal question and diversity jurisdiction. On November 30, 2009, Defendant filed an Answer (docket no. 9). On November 30, 2010, Mutual Wheel filed the Motion. On January 10, 2011, Plaintiff filed a Resistance (docket no. 22). On January 19, 2011, Mutual Wheel filed a Reply (docket no. 24). Plaintiff requests oral argument on the Motion. The court finds that oral argument is unnecessary. The Motion is fully submitted and ready for decision.

III. SUBJECT MATTER JURISDICTION

The court has diversity subject matter jurisdiction over Plaintiff's claims because complete diversity exists among the parties and the amount in controversy exceeds $75,000. See 28 U.S.C. § 1332 ("The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000... and is between citizens of different States"). The court also has federal question subject matter jurisdiction over Plaintiff's claim arising under the ADEA. See 28 U.S.C. § 1331 ("Thedistrict courts shall have original jurisdiction of all civil actions arising under the Constitution, laws or treaties of the United States.").

IV. SUMMARY JUDGMENT STANDARD¹

Summary judgment is appropriate "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." Fed. R. Civ. P. 56(a). "An issue of fact is genuine when 'a reasonable jury could return a verdict for the nonmoving party' on the question." Woods v. DaimlerChrysler Corp., 409 F.3d 984, 990 (8th Cir. 2005) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). A fact is material when it "might affect the outcome of the suit under the governing law." Anderson, 477 U.S. at 248. "[T]o establish the existence of a genuine issue of material fact, 'a [non-moving party] may not merely point to unsupported self-serving allegations.'" Anda v. WickesFurniture Co., 517 F.3d 526, 531 (8th Cir. 2008) (quoting Bass v. SBC Commc'ns, Inc., 418 F.3d 870, 872 (8th Cir. 2005)). Rather, the nonmoving party "'must substantiate [its] allegations with sufficient probative evidence that would permit a finding in [its] favor.'" Anda, 517 F.3d at 531 (quoting Bass, 418 F.3d at 873). The court must view the record in the light most favorable to the nonmoving party and afford it all reasonable inferences. Baer Gallery, Inc. v. Citizen's Scholarship Found. of Am., Inc., 450 F.3d 816, 820 (8th Cir. 2006) (citing Drake ex rel. Cotton v. Koss, 445 F.3d 1038, 1042 (8th Cir. 2006)).

V. RELEVANT FACTUAL BACKGROUND

Construed in the light most favorable to Plaintiff, the undisputed facts are as follows.

A. Players

Mutual Wheel is a Delaware Corporation operating as a family-owned warehouse distributor of truck and trailer parts. Mutual Wheel's corporate headquarters is in Moline, Illinois. Plaintiff is an Iowa citizen and was born in 1938. On March 6, 1966, Plaintiff began working in an entry-level position at Mutual Wheel's Dubuque, Iowa, store. At that time, Donald Engstrom was Mutual Wheel's owner and President. Donald's wife, June Engstrom, and their three sons, David, Richard and Robert Engstrom (collectively, "the Engstrom brothers"), assisted Donald with Mutual Wheel's operations. In 1972, Mutual Wheel promoted Plaintiff to assistant manager of the Dubuque store.

In 1989, Donald retired from his position as Mutual Wheel's President. At the time of Donald's retirement, Donald and June were Mutual Wheel's majority shareholders. Upon Donald's retirement, Mutual Wheel's Board of Directors created the Office of the President, which is comprised of the Engstrom brothers. Every year, Donald and June gifted Mutual Wheel stock to the Engstrom brothers until they eventually owned the company. In 1993, the Engstrom brothers promoted Plaintiff to branch manager of the Dubuque store.

Although Donald, age 91, and June, age 86, are retired, they serve Mutual Wheel's management in an advisory capacity. Donald and June are Directors on Mutual Wheel's Board, and Donald currently serves as the Board Chairman. In May 2010, Mutual Wheel employed approximately 75 individuals, 41 of whom were over the age of 50. Mutual Wheel's oldest employee is 80 years old.²

B. 2002 Golf Outing

On June 5, 2002, Plaintiff, Donald, Richard and a Mutual Wheel employee, Maynard Winkler, attended a golf outing. After Plaintiff and Donald left for the day, Richard spoke privately with Winkler about Plaintiff's health problems.³ Specifically, Richard discussed the fact that Plaintiff was having back problems and was coming to work late. Richard told Winkler that Plaintiff looked like he was "in pretty good shape." Plaintiff's Appendix ("Pl. App'x") (docket no. 22-2) at 48. Richard then told Winkler, "We're thinking about making a change in management at the store." Id. at 49. Richard testified that the purpose of the discussion was "to find out if [Winkler] had a long-term interest in... being the manager of the Dubuque store." Id. at 36. Winkler later told Plaintiff about the discussion.

On June 20, 2002, Donald came to the Dubuque store and spent the day with Plaintiff. During the visit, neither Plaintiff nor Donald mentioned the June 5, 2002 discussion between Richard and Winkler. After Donald left, Plaintiff called David to notify him that Donald was on his way to Moline.⁴ Plaintiff brought up the June 5, 2002discussion between Richard and Winkler, and David told Plaintiff that he could work at Mutual Wheel until he was 80 years old.

Later in the summer of 2002, Robert asked Plaintiff if he knew why they had offered his job to Winkler. When Plaintiff stated that he did not know, Robert informed him that it was because they thought Plaintiff's health was worse than it was.⁵ Mutual Wheel and Winkler deny that anyone offered Plaintiff's job to Winkler in 2002.

C. 2007 Scrap Metal Conflict

Several of Mutual Wheel's stores have drive-in service shops which accumulate worn metal parts. Each store discards this material by selling it as scrap metal. For fifteen years, Plaintiff collected the money from the sale of scrap metal and maintained a scrap fund at the Dubuque store. Plaintiff used this fund to buy employees lunch on their birthdays and dinner during the holidays, to make donations to United Way on Mutual Wheel's behalf and to buy hats and pins for the salesmen to give to customers.

In 2007, the Engstrom brothers decided that the company would require each store to forward the money obtained from the sale of scrap metal to Mutual Wheel's Moline headquarters. On May 1, 2007, Robert held a meeting with all of the branch managers, including Plaintiff, and directed that all stores must send their scrap proceeds to corporate headquarters. Plaintiff did not want to send the scrap proceeds to corporate headquarters, so Plaintiff decided to wait until David visited the Dubuque store to discuss the matter with him. The next time David visited the Dubuque store, Plaintiff and David discussed the scrap fund. Plaintiff maintains that David agreed to allow Plaintiff to keep the fund in Dubuque. David denies telling Plaintiff that he could keep the fund in Dubuque, and instead states that he gave Plaintiff permission to use the money to purchase stocking caps before sending the money to corporate headquarters. Plaintiff continued to maintain the scrap fund at the Dubuque store until his termination.

D. Reimbursement Conflict

In October 2007, David raised concerns with Robert and Richard that Plaintiff was charging Mutual Wheel abnormally high mileage for the use of Plaintiff's personal vehicle and trailer. Although Plaintiff used his personal vehicle for work...