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United States District Court, E.D. Pennsylvania

January 23, 2004.


The opinion of the court was delivered by: JACOB HART, Magistrate Judge


I. Introduction

In this action, James Beverly ("Beverly"), originally alleged that the Desmond Hotel and Conference Center, (the "Desmond"), was liable to him under Title VII of the Civil Rights Act, 42 U.S.C. § 2000e et seq., for racial and religious discrimination, and under the ADEA, 29 U.S.C. § 621 et seq., for discrimination on the basis of age. The Honorable Stewart Dalzell, to whom this case was originally assigned, classified Beverly's claims as follows: (a) for hostile work environment on the basis of race religion and age; (b) for failure to promote on the basis of race, religion and age; (c) for discriminatory discharge on the basis of race, religion and age; and (d) for retaliatory discharge. Order, of July 2, 2003, at ftn. 1.

  However, in two orders entered on the Desmond's motion for summary judgment, dated July 2, 2003, and September 25, 2003, Judge Dalzell dismissed all of Beverly's claims except for the claim of failure to promote on the basis of age, in violation of the ADEA. This case was subsequently transferred here by consent of the parties, and in accordance with 28 U.S.C. § 636(c). Page 2

  Trial in this case was scheduled for the afternoon of Tuesday, January 20, 2004, with the jury to be chosen that morning. On Friday, January 16, 2004, however, I informed the parties in a telephone conference that I would hear argument on the morning of January 20, before jury selection, as to whether summary judgment should be entered in favor of the Desmond because of Beverly's inability to prove damages.

  On the morning of January 20, 2004, I heard oral argument on this issue. After this, I stated on the record my intention to grant summary judgment in favor of the Desmond. Transcript of January 20, 2004, Hearing at 15-18. I issued a written order to that effect on the same day. Order of January 20, 2004, Docketed as Document No. 42. I specified in court, and in my written order, however, that I would issue an opinion fully explaining my holding. I now set forth that opinion.

 II. Factual Background

  Beverly worked at the Desmond between July 1999 and April, 2000. Pretrial Stipulation at 1-2 ¶¶ 1, 10. He claimed that he expressed to the Desmond his interest in a job as a busboy in the dining room, and was told that he would be trained for this position. Pretrial Stipulation at 2-3, ¶¶ 5-6, 9. However, he was never trained or selected as a busboy. Beverly claimed that, in a conversation which took place shortly after he left the Desmond, General Manger Michael Chain told him that he had never been made a busboy because he was too old. Judge Dalzell's Order of July 2, 2003, at 4, ¶ (m), citing Beverly Deposition at 124-125.

  The parties agreed that the salary for a busboy was actually lower than the salary for a kitchen worker. Pretrial stipulation at 1, ¶¶ 3-4. Nevertheless, Beverly maintains that he viewed the job change as a promotion because it offered more prestige, better working conditions, and Page 3 was a stepping stone to a waiter position which would have been well-paid. Pretrial Stipulation at 2-3, ¶¶ 7-8.

 III. Legal Standards

 A. Summary Judgment

  Summary judgment is warranted where the pleadings and discovery, as well as any affidavits, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law. Fed.R.Civ.Pr. 56. A court may grant summary judgment sua sponte to a non-moving party in appropriate circumstances. Gibson v. City of Wilmington, No. 02-3952, 2004 WL 36059 at * 4 (3d Cir. Jan. 8, 2004); Chambers Development Company v. Passaic County Utilities Authority, 62 F.3d 582, 584 n. 3 (3d Cir. 1995).

  In Gibson, the Court of Appeals for the Third Circuit pointed to a quote from an earlier Third Circuit case which held that a sua sponte grant of summary judgment was inappropriate where the party against which it was granted was not afforded the ten days notice required by Fed.R.Civ.Pr. 56(c). 2004 WL 36059 at *5, quoting Otis Elevator Company v. George Washington Hotel Corporation, 27 F.3d 903, 910 (3d Cir. 1994).

  The Gibson court held, however, that sua sponte summary judgment could also be granted immediately before trial, even without ten-days notice, where (a) the point at issue is purely legal; (b) the record is fully developed and (c) the failure to give notice does not prejudice the party against whom summary judgment was granted. 2004 WL 36059 at * 1.

  Here, although Beverly was not given the Rule 56(c) ten days notice, he was given five days notice, the opportunity to file briefing on the issue of damages (in fact, Beverly took advantage of this opportunity and submitted a memorandum of law), and the opportunity to argue Page 4 the issue at a formal hearing in open court at the end of the five days' notice. Clearly, he was not prejudiced by any lack of notice.

  Moreover, just as in Gibson, "because the Court's pronouncement came on the morning of the trial, full opportunity for discovery had already obtained." 2004 WL 36059 at * 5. Finally, the point at issue was purely legal, as required by Gibson. The parties agreed that Beverly could obtain no back pay, since he would actually have been receiving a lower salary as a busboy until the date of discharge. The issue was whether he was legally eligible for some other form of damages. It is apparent, therefore, that I had the authority to grant summary judgment in favor of the Desmond upon my own initiative.

  It is also apparent that summary judgment in an ADEA case is appropriate where no damages can be proven. Rivadeneira v. City of Philadelphia, Civ. A. No. 90-4979, 1994 WL 594122 at * 9 (E.D. Pa. Oct. 31, 1994), (a Title VII case citing Snair v. City of Clearwater, 817 F. Supp. 108, 112-13 (M.D. Fla. 1993), in which summary judgment was granted in an ADEA case for that reason).

 B. Damages Available Under the ADEA

  As to damages, the ADEA incorporates by reference the now-repealed damages section of the Fair Labor Standards Act, ("FLSA"), 29 U.S.C. § 216, which provided:

Any employer who violates . . . this title shall be liable to the employee or employees affected in the amount of their unpaid minimum wages, or their unpaid overtime compensation, as the case may be, and in an additional equal amount as liquidated damages.
29 U.S.C. § 626(b). Thus, relief available under the ADEA includes the recovery of lost wages, "and an additional equal amount as liquidated damages" in the case of a willful violation. Commissioner of Internal Revenue v. Schleier, 515 U.S. 323, 325 (1995). Page 5

  Compensatory damages are not available. In Commissioner of Internal Revenue v. Schleier, supra, the United States Supreme Court observed that "the Courts of Appeals have unanimously held . . . that the ADEA does not permit a separate recovery of compensatory damages for pain and suffering or emotional distress." 515 U.S. at 326; citing, inter alia, Rogers v. Exxon Research & Engineering Company, 550 F.2d 834 (3d Cir. 1977), cert. denied, 434 U.S. 1022 (1978) overruled on other grounds by Smith v. Jos. Schlitz Brewing Company, 584 F.2d 1231 (3d Cir. 1978).

  In Rogers v. Exxon, supra, the Court of Appeals for the Third Circuit reversed a trial court which had permitted the recovery of damages for pain and suffering in an ADEA case, on the basis that "the ADEA created a new tort." 550 F.2d at 839. After examining the language of the statute, and its legislative history, the Rogers court essentially decided that Congress permitted the recovery of liquidated damages in lieu of the recovery of compensatory damages. Id. It concluded that permitting an award for pain and suffering would thwart the recovery scheme planned by Congress, and would also present administrative problems. 550 F.2d at 839-842. See, also Rossi v. Sun Refining & Marketing Corp., Civ. A. No. 94-3037, 1995 WL 12056 at* 10 (E.D. Pa. Jan. 11, 1995).

  The Third Circuit has not considered whether nominal damages are available in an ADEA case. In Rivadeneira, supra, however, the Honorable Lowell A. Reed, Jr., found that nominal damages were not available in a Title VII case applying the pre-1991 statute, because "the fact that Title VII does not provide for compensatory or punitive damages [as it did not, pre-1991] indicates that Congress did not intend for nominal damages to be available under Title VII." 1994 WL 594122 at *9, brackets supplied. I believe that the same reasoning applies to the Page 6 ADEA, which does not permit compensatory or punitive damages. The restrictions placed by Congress on the damages available in an ADEA case signal its intention to make only direct economic losses recoverable.*fn1

 IV. Discussion

  Crucial to this discussion is the fact that Judge Dalzell's earlier rulings left alive only Beverly's ADEA claim for failure to promote. If a Title VII claim had remained, Beverly would have been entitled to try to prove to a jury that he was entitled to compensatory damages. In such a case, I would not have granted summary judgment in favor of Desmond.

  As the case stood before me on January 20, 2004, however, only one ADEA claim remained. Accordingly, Beverly was entitled to reach a jury only if he could prove lost wages. He was plainly unable to do this. If the act of alleged discrimination had not occurred, it is undisputed that Beverly would have been working for a lower wage than the wage he actually received during his employment at the Desmond. Beverly did not even argue that he would have become a waiter at any time before his termination. Under these circumstances, I granted summary judgment in favor of the Desmond.

  Beverly argued that he was still eligible for an award of liquidated damages, if he could prove a willful violation of the ADEA, predicated upon an award of nominal damages. However, I cannot accept this argument. If no nominal damages can be awarded, there is no way to double them to arrive at a correct award for liquidated damages. Since the ADEA specifically provides that liquidated damages are to be awarded in an amount equal to the lost wages recoverable, I am plainly not permitted to dream up another way of calculating them. Page 7

  Even if Beverly's argument is that liquidated damages can, in themselves, be used as a form of nominal damages, it is still unacceptable. First, as above, it is completely inconsistent with the ADEA's specific directions as to the calculation of liquidated damages. Secondly, it would represent an "end run" around Congress's decision not to provide for the recovery of nominal damages under the ADEA.

  Beverly also argued that his complaint incorporated by reference a claim under the Pennsylvania Human Relations Act, (the "PHRA"), 43 Pa. C.S.A. § 951 et seq., under which compensatory damages may be awarded. He pointed to Count III of his Complaint, entitled Plaintiff's Claims Against the Defendant for Wrongful Discharge Based on Retaliation, where it stated that the Desmond's actions "constituted a wrongful termination in violation of the public policy of the Sate of Pennsylvania." Amended Complaint at ¶ 59. However, even if this language could be interpreted as a PHRA claim (which is doubtful) it was no longer in the case on January 20, 2004. Judge Dalzell dismissed Count III in his earlier orders on the Desmond's motion for summary judgment.

  In short, because there was no possibility that Beverly could prove that he suffered any form of damages available under the ADEA, I granted summary judgment in favor of the Desmond. As a final point, I wish to clarify that, for purposes of appeal, my Order of January 20, 2004, incorporates Judge Dalzell's Orders of July 3, 2003 and September 25, 2003, which granted partial summary judgment.

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