On Appeal from the United States District Court for the District of New Jersey. (D.C. Civil No. 92-01708).
Before: Becker, Cowen and Garth Circuit Judges.
On March 9, 1994, the district court granted summary judgment in favor of Johnson & Higgins ("J & H"), the employer of appellant Burt Sempier. Sempier now appeals the district court's grant of summary judgment on his Age Discrimination in Employment Act (ADEA) claim, 29 U.S.C. § 263 (1988),*fn1 and the discretionary dismissal of his pendent state law claims. He also raises as error the district court's substitution of a "Bill of Particulars" in place of his interrogatories.
We have jurisdiction pursuant to 28 U.S.C. § 1291 to review the March 9, 1994 final order of the district court. Because the record reflects a genuine issue of material fact regarding whether J & H's asserted nondiscriminatory reasons for discharging Sempier are pretextual, we will reverse the summary judgment entered in favor of J & H. We also conclude that the district court abused its discretion in substituting its own "Bill of Particulars" for Sempier's interrogatories.
Sempier joined appellee J & H, an insurance brokerage and employee benefits consulting firm, in 1968.*fn2 Sempier worked as Comptroller until 1971 when he became Treasurer of J & H. In 1984, J & H created a new position of Chief Financial Officer ("CFO"), and the Board of Directors elected Sempier to that post. The parties dispute whether the J & H directors criticized Sempier's performance as CFO. Sempier avers that no one advised him that his performance was less than satisfactory nor did anyone bring to his attention any deficiencies in his performance of his functions. App. 300. Robert Hatcher, the firm's chairman who was Sempier's friend and had been instrumental in Sempier being elected as CFO, states that he was generally pleased with Sempier's work. At the same time, he acknowledges that other directors had criticized Sempier's performance. App. 363-65. Other J & H directors state in affidavits that they believed that Sempier performed below expectations. App. 727 (affidavit of Eric Johnson); App. 778-79 (affidavit of Kenneth Hecken).
In 1985, one year after Sempier assumed his duties as CFO, an outside audit of the Finance Department, requested by J & H director Eric Johnson, criticized the department's operations. App. 728-29. After further investigation, Johnson sought to have Sempier replaced. Despite Johnson's criticisms, J & H unanimously elected Sempier to the Board of Directors in 1986. Hatcher supported Sempier's election to the Board of Directors because he believed that this move would assist Sempier in improving the Finance Department's operations. When Sempier was elected, J & H required that he execute a letter of resignation that would become effective upon a two-thirds vote of the Board of Directors.
In May 1987, J & H removed Sempier from his responsibilities as CFO and made him Chief Administrative Officer ("CAO") in charge of Management Information Systems ("MIS"), Human Resources, Professional Development, and Real Estate and Facilities. Sempier was unanimously reelected to the Board in 1989. Both sides dispute how Sempier performed as CAO.
Due to the increasing importance of MIS services and the department's unsatisfactory record, J & H decided to elevate the MIS department's status by hiring a Chief Information Officer ("CIO"), thereby removing MIS from Sempier's supervision. Notwithstanding some lobbying by Hatcher, the firm denied Sempier the CIO position. In December 1989, J & H hired Alan Page, who is fourteen years younger than Sempier, as CIO. The directors elected Page to the board in 1990.
Three months later, J & H hired Thomas Carpenter, who is four years younger than Sempier, to assume responsibility for Human Resources and Professional Development, starting in May 1990. Carpenter's arrival left Sempier with significantly reduced responsibilities.
In May 1989, before either Page or Carpenter had been hired, J & H had instituted an early retirement program to retire "redundant" and "poorly performing" employees who were 55 years of age or older. App. 636-37. The firm intended to use the program either to "pull" employees into retirement through incentives or to "push" them into retirement through involuntary "terminations" which were to be characterized as downsizing. App. 637 (Exhibit 8).
In April 1990, Hatcher, who was still the Chairman of J & H, advised Sempier to retire early with certain enhancements to his existing retirement package. Hatcher stated that Sempier had "lost credibility" with unnamed senior managers. App. 301. Sempier refused to retire. Hatcher responded, using strong and unequivocal language, that Sempier had no choice but to retire or to be forced out. App. 302.
Between April 1990 and April 1991, J & H engaged in extended, and occasionally bitter, negotiations with Sempier seeking to obtain his retirement or resignation. In January 1991, David Olsen succeeded Hatcher as Chairman of J & H. When, in the spring of 1991, Sempier told Olsen that he had hired a lawyer, Olsen told Sempier that he could no longer return to J & H and should vacate his office. App. 81. At the same time, Olsen wrote the firm's general counsel that "it's obviously time for hardball." App. 80. After Sempier consistently refused to retire, the Board made effective Sempier's previously executed resignation in June 1991.
Sempier filed an age discrimination claim with the Equal Employment Opportunity Commission, received a right to sue letter, and instituted an ADEA suit in the District of New Jersey with pendent state law claims for breach of contract as well as violations of the New Jersey Law Against Discrimination and the New Jersey Business Corporations Act. J & H answered that Sempier had been discharged for poor performance.
At the outset of the litigation, Sempier served two sets of interrogatories and a series of document requests on J & H. When J & H refused to respond to a substantial portion of the discovery requested, Sempier sought an order from the magistrate Judge which would have compelled J & H to respond. The magistrate Judge denied Sempier's motion. On appeal, the district court Judge vacated the order of denial but remanded the dispute to the magistrate Judge without entering an order compelling discovery. On remand, the magistrate Judge relieved J & H from answering the original two sets of interrogatories and required that Sempier draft a third set of interrogatories. App. 563-64. After J & H refused to answer almost all of these interrogatories, Sempier again sought a second order compelling discovery. The magistrate Judge denied Sempier's motion to compel answers and ordered J & H to provide information responding to a "Bill of Particulars" drafted by the court. App. 576. On appeal, the district court affirmed the magistrate Judge's order and added one question of its own to the "Bill of Particulars."
Between November and December 1993, the parties disputed whether J & H had complied with the court's orders to answer the court's questions and to provide documents. In December, Sempier filed additional motions for an order to compel discovery and for partial summary judgment. J & H replied with its motion for summary judgment.
The district court granted J & H's summary judgment motion on the ADEA claim and dismissed the remaining pendent claims without prejudice. The district court expressed concern that Sempier had not made out a prima facie case because of an inability to show that he was a qualified employee or replaced by a sufficiently younger employee to raise an inference of age discrimination. Nonetheless, it turned to J & H's asserted nondiscriminatory reasons for Sempier's discharge and Sempier's evidence of pretext.
The district court found that J & H had come forward with two alleged reasons for Sempier's discharge: (1) that Sempier's reduced responsibilities did not justify his continued presence on the Board of Directors and (2) that Sempier's poor performance had justified the reduction in his responsibilities and eventual discharge. Moreover, the district court held that Sempier had not produced sufficient evidence to allow a jury to find that J & H's alleged nondiscriminatory reasons were a pretext for discrimination. Accordingly, the court entered a judgment in favor of J & H, denied Sempier's motion for partial summary judgment, and dismissed Sempier's pendent state law claims without prejudice.
Sempier filed a timely appeal.
When we review a grant of summary judgment, we apply the same test that the district court should have applied initially. Chipollini v. Spencer Gifts, Inc., 814 F.2d 893, 896 (3d Cir.) (en banc), cert. dism'd, 483 U.S. 1052 (1987). Summary judgment is appropriate only when the admissible evidence fails to demonstrate a dispute of material fact and the moving party is entitled to judgment as a matter of law. Id. ; see Fed. R. Civ. Proc. 56(c) (1994). When the moving party (here, J & H) does not bear the burden of persuasion at trial, the moving party may meet its burden on summary judgment by showing that the nonmoving party's (here, Sempier's) evidence is insufficient to carry its burden of persuasion at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). Thereafter, the nonmoving party ...