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DIBIASE v. SMITHKLINE BEECHAM CORP.

September 27, 1993

JOHN DIBIASE
v.
SMITHKLINE BEECHAM CORP.



The opinion of the court was delivered by: BY THE COURT; JOHN R. PADOVA

 Padova, J.

 September 27, 1993

 I. FACTS

 Plaintiff's amended complaint alleges the following facts, which I must accept as true for purposes of the motion to dismiss. SmithKline is a corporation that manufactures and markets prescription and over-the-counter pharmaceutical and consumer products. Plaintiff was hired by a predecessor of SmithKline in 1964, and was employed until February 2, 1992, when his job was terminated as part of a workforce reduction. At the time of his termination, plaintiff was fifty-one years old and was a computer shift supervisor at SmithKline's corporate data center.

 SmithKline offered its terminated employees a separation benefit plan that included a lump sum payment *fn1" and three months continued health and dental benefits. The plan also offered enhanced benefits to terminated employees who signed a general release of all claims against SmithKline. *fn2" The enhanced benefits included a larger lump sum payment and six months continued health and dental coverage. Under the plan, plaintiff was entitled to a lump sum payment equal to fifteen months salary if he signed the release, or twelve months salary if he declined to sign the release. Plaintiff did not sign the general release.

 Plaintiff's amended complaint sets forth two counts alleging age discrimination in violation of ADEA. Count I states that SmithKline terminated plaintiff's employment because of his age. Count II alleges that SmithKline's separation benefit plan offers enhanced benefits in exchange for a surrender of rights, but requires that older employees surrender more rights than younger employees for the exact same enhanced benefits. *fn3"

 II. MOTION TO DISMISS

 In determining a motion to dismiss, all assertions in the complaint are assumed to be true, and all reasonable inferences are drawn from the complaint in favor of the non-moving party. Kehr Packages, Inc. v. Fidelcor, Inc., 926 F.2d 1406, 1410 (3d Cir.), cert. denied, 115 L. Ed. 2d 1007, 111 S. Ct. 2839 (1991). The complaint can be dismissed only if plaintiff has alleged no set of facts upon which relief can be granted. Id.

 ADEA prohibits employers from "discriminating against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age." 29 U.S.C.A. § 623(1) (West 1985). Count II of plaintiff's amended complaint alleges that SmithKline's separation benefit plan discriminates based on age. Although Count II asserts a novel legal issue, it clearly states a claim for relief under ADEA. Yet SmithKline vigorously insists plaintiff has failed to state a valid claim, and has set forth essentially four arguments in favor of its motion to dismiss. I am not persuaded by any of these arguments.

 First, SmithKline cites sections of ADEA and Third Circuit precedent addressing the validity of signed waivers. This support is completely inapposite, as plaintiff never executed the general release, and does not now challenge the validity of a signed waiver. *fn4" Rather, Count II alleges that the separation benefit plan violates ADEA because it offers enhanced benefits in a manner that discriminates based on age. SmithKline has cited no authority directly addressing this issue. *fn5"

 Second, SmithKline contends that its separation benefit plan does not discriminate because all employees are required to release all claims against the company, regardless of each individual employee's legal rights. The effect of the release, however, is that persons age forty and older are required to release more than that required of persons under age forty in order to receive the same enhanced benefits. SmithKline has not shown, therefore, that the plan is not discriminatory as a matter of law. Cf. Massarsky v. General Motors Corp., 706 F.2d 111, 120 (3d Cir.), cert. denied, 464 U.S. 937, 78 L. Ed. 2d 314, 104 S. Ct. 348 (1983) (disparate impact analysis requires showing that facially neutral employment practice had a significantly discriminatory impact); E.E.O.C. v. Governor Mifflin School District, 623 F. Supp. 734, 741 (E.D. Pa. 1985) (holding that disparate impact analysis may be applied in ADEA cases).

 Third, SmithKline asserts that under plaintiff's theory, an employer could never secure a release of ADEA claims. The plaintiff does not, however, claim that it is always unlawful to seek a waiver of ADEA claims. Rather, plaintiff argues that an employer could secure a release of ADEA claims by offering additional consideration beyond that offered for a release of all claims except ADEA claims. SmithKline has not demonstrated, therefore, that ...


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