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Gaskey v. Fulton Bellows

March 20, 2007

CALVIN GASKEY, ET AL., PLAINTIFFS,
v.
FULTON BELLOWS, LLC., ET AL., DEFENDANTS.



The opinion of the court was delivered by: Thomas W. Phillips United States District Judge

(Phillips)

MEMORANDUM OPINION

Plaintiffs are former employees of the defendants and bring this action alleging age discrimination in violation of the Age Discrimination in Employment Act (ADEA), 29, U.S.C. § 621 et seq. Plaintiffs allege that defendant Fulton Bellows, LLC, engaged in employment practices that, while neutral on their face, resulted in a disparate impact on individuals age 40 and over.

Defendants deny plaintiffs' claims and assert that a review of the workforce Fulton Bellows, LLC hired shows that it did not use age to reject applicants, and that plaintiffs cannot show a statistically significant disparity in the hire rate of older applicants. Thus, defendants move for summary judgment asserting that there are no genuine issues as to material facts, and that they are entitled to judgment as a matter of law on all of plaintiffs' claims. For the reasons which follow, defendants' motion for summary judgment will be granted, and this action will be dismissed.

Factual Background

The 138 plaintiffs are grouped into four groups based on their differing statuses with respect to the date of their separation from Fulton Bellows & Components, Inc., and based upon the alleged reason for their continued separation from the company. Group 1 employees are those employees who were released from employment by the company on or about August 2, 2004 and later unsuccessfully sought employment with Fulton Bellows, LLC. Group 2 employees are those employees who were released from employment by the company on or about August 2, 2004, and did not later seek employment with Fulton Bellows, LLC. Group 3 employees are those employees whose employment with the company was terminated prior to August 2, 2004, and later unsuccessfully sought employment with Fulton Bellows, LLC. Group 4 employees are those employees whose employment with the company was terminated prior to August 2, 2004 and did not later seek employment with Fulton Bellows, LLC.

Defendant Fulton Bellows, LLC (FBLLC) is a Delaware limited liability company. Defendant Fulton Bellows & Components, Inc. (FBCI) is also a Delaware corporation. FBCI filed a voluntary petition for relief under Chapter 11 of the Bankruptcy Code on June 10, 2003, in the United States Bankruptcy Court for the Eastern District of Tennessee, Northern Division. An order was entered by the Bankruptcy Court on July 29, 2004, authorizing the sale of assets of FBCI to FBLLC. FBCI laid off all of its remaining employees on or about August 2, 2004. FBLLC acquired the assets of FBCI on or about August 3, 2004. The bankruptcy case of FBCI was converted from Chapter 11 to Chapter 7 of the Bankruptcy Code by order of the Bankruptcy Court on October 6, 2004.

Defendant Morris Capital Management, LLC is a Tennessee limited liability company. Morris is the sole general partner of Special Situations Fund, L.P. (SSF), a Tennessee limited partnership. SSF owns ninety-six percent (96%) of the membership interests of FBLLC. Morris states it has never owned any interest in either FBLLC or FBCI, and neither FBLLC nor FBCI has ever owned any interest in Morris. Morris has never made or participated in the hiring or termination decisions made with respect to employees of either FBLLC or FBCI. Morris has never participated in, or been a part of, a business enterprise with either FBLLC or FBCI.

Through articles and job postings in the Knoxville News Sentinel, FBLLC invited all former FBCI employees, as well as the public at large, to apply for employment. Through the initial start-up phase of FBLLC, applications for employment were accepted and screened through the State Career Office of the Tennessee Department of Employment Security (DES). Applicants completed a general/generic employment application form used by DES.

After the initial start-up phase, applications were accepted and screened directly at the FBLLC facility. FBLLC used its own application for employment form. Neither the DES's employment application nor FBLLC's application requested information concerning an applicant's age, prior union membership or history of healthcare insurance costs.

Plaintiffs applied for employment during August, September and October of 2004. During those months, 507 individuals applied for employment with FBLLC. 170 of the 507 applicants were under age 40. The other 337 applicants (which included 48 plaintiffs) were 40 years or older. FBLLC hired 45 of the 170 applicants under age 40. FBLLC hired 76 of the 337 applicants age 40 and older. FBLLC hired15 individuals who had been in a job position included in a bargaining unit represented by either the United Steel Workers of America, Local 5431 or the International Association of Machinists and Aerospace Workers, Local 555, when they were employed by FBCI.

TSI is one of the employment agencies hired by FBLLC. TSI first asked any person calling about employment at FBLLC whether that person had worked for FBCI. The potential employee was then told that FBLLC would be contacted to determine whether the employee should fill out an application with TSI. Plaintiffs state that former workers of FBCI were told they would not be hired at FBLLC. Plaintiffs contend that this employment practice by FBLLC intended to not only discourage plaintiffs from applying with the company but also made such application futile.

Linda Knight, Human Resources Manager of FBLLC, stated, via affidavit, that upon hearing about the situation with TSI, she promptly contacted the agency to stress that "they were supposed to treat any prior employee, the contact, same as any non-Fulton Bellows and Components employee, go through the exact same hiring process." She further stated that TSI only was authorized to check on whether former employees were considered good workers at FBCI or not, while still directing these individuals to apply for employment. FBLLC later terminated TSI's services when it heard of potential confusion in the process.

Defendants have moved for summary judgment on all plaintiffs' claims, and have moved to strike portions of plaintiffs' affidavits filed in opposition to defendants' motion for summary judgment.

Motion to Strike

Defendants move to strike certain paragraphs from plaintiffs' affidavits filed in support of plaintiffs' response to defendants' motion for summary judgment on the grounds that the affidavits contain statements which do not meet the standards of Rule 56(e) of the Federal Rules of Civil Procedure. Specifically, defendants state the affidavits contain (1) testimony not based on facts personally known to the affiant, (2) conclusions or opinions without supporting evidence, and (3) hearsay. Plaintiffs respond that the affidavits are not offered as proof that the defendant was discriminating in its hiring policy, but to show the former employees' belief that applying for employment with the new company would be futile. Yet, to defeat summary judgment plaintiffs must show evidence of pervasive discrimination in all aspects of [the employer's] internal employment practices, and [that] . . . any application would have been futile and perhaps ...


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