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ARMBRUSTER v. ERIE CIVIC CTR. AUTH.

September 30, 1995

JAY M. ARMBRUSTER, Plaintiff,
v.
ERIE CIVIC CENTER AUTHORITY, Defendant.



The opinion of the court was delivered by: MCLAUGHLIN

 McLAUGHLIN, J.

 Plaintiff Jay M. Armbruster was employed as managing director for Defendant, the Erie Civic Center Authority ("ECCA" or the "Civic Center"), until his termination on April 28, 1992 at the age of 60. Following his termination, Armbruster filed this action against ECCA, alleging that Defendant's actions violated the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. §§ 621 et seq., and the Pennsylvania Human Relations Act ("PHRA"), 43 Pa. Stat. §§ 951 et seq.. This Court has jurisdiction pursuant to 29 U.S.C. § 626(c) (1) and 28 U.S.C. §§ 1331, 1343(a) (4) and 1367.

 Presently before the Court is Defendant's motion for summary judgment on both counts. For the reasons set forth below, Defendant's motion will be granted.

 I. BACKGROUND

 The ECCA is a municipal authority created by the City of Erie. Over the years, the Civic Center has frequently operated with a deficit, requiring partial funding by the City pursuant to a contract between the two entities. Every fall the ECCA presents a preliminary budget to the Erie City Council members for approval.

 In the fall of 1991, Plaintiff and various members of the ECCA's Board of Directors submitted a proposed budget to the City Council. The budget projected an operating deficit for the year 1992. By Plaintiff's own account, the encounter with City Council went "disastrously." (Armbruster Depo. Tr. at 39-40.) Because the City was experiencing financial difficulties at that time, City Council rejected ECCA's budget and indicated that the Civic Center would need to submit a new budget showing a substantially lower operating deficit. Laura Eaton, who would begin as the new Chairperson of ECCA's Board in January of 1992, stated she was embarrassed by this incident. She also developed "concerns about what was going on at the Civic Center." (Eaton Depo. Tr. at 16-17.)

 Following this meeting with City Council, the budget was revised and efforts were made to reduce ECCA's deficit by increasing revenues and decreasing expenses. In January of 1992, the Board significantly reduced its projected deficit by, among other things, making two important changes: (1) laying off several employees and imposing a hiring freeze; and (2) raising the service charge on tickets from $ 0.25 to $ 0.75 per ticket. These changes were incorporated into the Civic Center's 1992 budget as finally adopted by the Board. Plaintiff himself acknowledged that in early 1992 the budget was "the big thing on everybody's mind." (Armbruster Depo. at 46.) Laura Eaton described the increased surcharge as "critical for us to help balance the budget," because "City Council had told us that they were not going to give us more money" and "it was up to us to make changes and balance the budget," because "the taxpayers could no longer afford to subsidize us with large amounts of money." (Eaton Depo. Tr. at 24-25.)

 In early 1992, several new Board members were elected and the Board took a different direction than in years past. In January, Eaton requested that Sean Sullivan, a local certified public accountant, undertake a review of the Civic Center's financial condition and make recommendations. Upon review of the ECCA's records and information systems and discussions with employees about the Civic Center's finances, Sullivan concluded that "the place was just bleeding to death." (Sullivan Depo. Tr. at 50.)

 Sullivan then prepared a memorandum summarizing his findings. Gery Nietupski, a then thirty-two year old member of the Board, requested that Sullivan's memorandum be converted into a "performance evaluation" of Armbruster. *fn1" (Sullivan Depo. at 32.) That evaluation, in its entirety, provided as follows:

 
(1) Jay did not display the management skills needed to lead the Center through its financial difficulties:
 
(a) lack of recognition to the City of Erie's direction toward defunding the Center.
 
(b) Lack of management control to effectuate cost savings measures in light of prospective cash flow deficits.
 
(c) Lack of management initiative to review and revise pricing structure of facilities in order to cover fixed costs.
 
(d) Implementation of personnel policies which were not uniformly applied to all employees.
 
(e) Lack of personnel skills relating to effective use of Center part-time personnel to effectively generate the maximum return to the Center.
 
(f) Lack of management skills relating to establishment of an effective and timely information recovery system which could be utilized for financial analysis.
 
(2) Jay did not consistently apply Center rentals to events as evidence by varying rentals for similar events.
 
(3) Jay did not effectively carryout [sic] the specific directions of the Authority's Board:
 
(a) Implementation of revised ticket surcharge was undertaken by Jay on a selective basis.
 
(b) Implementation of ticket surcharge was not controlled by Jay which resulted in the Center losing surcharge income of numerous ticket sales.
 
(c) Hiring of part-time accounting personnel when such hirings were specifically suspended by the Board.
 
(d) Numerous requests for insurance and other financial information of the Center, requested by Authority Board members, were never fulfilled by Jay.
 
(4) Jay did not display the financial knowledge of Center event or operating breakeven levels needed to effectively price events and maintain a steady and consistent stream of cash flow. Again, Jay's approach was the City of Erie would cover any and all operating deficits. The motivation to minimize Center operating deficits was not consistently displayed by Jay.
 
(5) Jay did not display the ability to maintain the lowest possible operating costs for the Center. Insurance contracts, professional fees and other costs were not regularly reviewed and competitively bid to ensure maximum utilization of resources.

 (Def.'s Append. Ex. 8.)

 Sullivan later summarized the message behind this evaluation: "I felt that Jay did not have the skills to function as the managing director of the Civic Center financially." (Sullivan Depo. at 38.) The contents of Sullivan's memorandum were discussed at the Board's March, 1992 meeting. Defendant avers that Board members at that time believed, and discussed the fact, that Plaintiff had violated the Board's directives to increase the ticket service charge to $ 0.75 and to suspend hiring of employees. At this meeting, the Board decided to place Armbruster on forced vacation status. Following the meeting, the Board requested Armbruster's resignation, but he refused to resign. Consequently, at the Board's next meeting on April 28, 1992, the Board voted seven to two to terminate Plaintiff's employment. Two members dissented on the ground that they believed Armbruster should have been given more of an opportunity to ameliorate the problems concerning the Board.

 Following Plaintiff's termination, the Board appointed the operations manager, John "Casey" Wells, as acting managing director in Armbruster's place. At the time, Wells was less than 40 years of age. There is unrebutted evidence that, following Wells' appointment, the Civic Center implemented any of Sullivan's recommendations. There is further unrebutted evidence that, at the end of 1992, the Center showed a net income of $ 34,919.00 as opposed to a net ...


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