United States District Court, W.D. Pennsylvania
October 11, 2005.
WALTER L. ESHELMAN, Plaintiff,
MAGEE-WOMENS HOSPITAL OF UNIVERSITY OF PITTSBURGH MEDICAL CENTER UPMC AND UPMC t/d/b/a/ UNIVERSITY OF PITTSBURGH MEDICAL CENTER, Defendants.
The opinion of the court was delivered by: TERRENCE McVERRY, District Judge
MEMORANDUM OPINION AND ORDER
Presently before the Court for disposition is the MOTION FOR
SUMMARY JUDGMENT, with brief in support thereof (Document Nos.
17 and 18) filed by Defendants, Magee-Womens Hospital of
University of Pittsburgh Medical Center UPMC and UPMC t/d/b/a
University of Pittsburgh Medical Center, the brief in opposition
filed by Plaintiff, Walter L. Eshelman (Document No. 25), and
the Reply Brief filed by Defendants (Document No. 28).
After careful consideration of the motion, the material in
support and opposition thereto, the memoranda of the parties in
support and opposition thereto, the relevant case law, and the
record as a whole, the Court finds that there is no record
evidence such that a reasonable jury could return a verdict for
Plaintiff, Walter L. Eshelman, on his federal claims of
discrimination under the Age Discrimination in Employment Act,
29 U.S.C. § 621 et seq. Therefore, the Court will grant
Defendant's motion for summary judgment as to all federal claims
which allege age discrimination by Plaintiff, Walter L. Eshelman. BACKGROUND
The facts relevant to this discussion, and viewed in the light
most favorable to Plaintiff, are as follows.
Plaintiff began his employment as Manager of Compensation and
Benefits in the Human Resources Department of Magee-Womens
Hospital UPMC ("Magee") on September 18, 1998. At that time,
Magee was an independent hospital, and the Compensation and
Benefits Department was a "freestanding" department. (Tibbot
Affidavit at ¶ 3.) At the time of his hire, Plaintiff's position
involved the following job functions:
a. personnel management of staff to include
selection, supervision, training, performance
evaluations, scheduling and staffing levels;
b. coordinating hospital-wide compensation and
benefit fringe budget process including market
research, trend analysis and recommendations;
c. maintaining benefit programs including plan
documents, Summary Plan Descriptions, employee
communications, administration and the annual
d. analyzing current and potential benefits
selections for cost competitiveness, efficiency and
e. participating in negotiating contracts, selecting
new carriers and overseeing ongoing communication and
f. maintaining legal and regulatory compliance for
all benefits programs and for ensuring completion and
compliance with all government mandated filing;
keeping abreast of pending and new legislation as it
pertains to Hospital's programs and initiates
notification to Directory, communication to staff and
any necessary systems modifications;
g. initiating development and delivery of new
compensation and benefit programs and inservices to
increase employee awareness and perceived value; h. developing or modifying policies, practices or
programs based on pertinent trends, changing employee
demographics and cost effectiveness strategies;
i. investigating methods to automate benefits
administration and reporting including software
enhancements or programming changes;
j. developing regular financial reporting including
administration and reporting utilization analysis and
expense projections. Participating with the Director
in identifying cost effective alternatives to current
or anticipated programming;
k. overseeing ongoing administration of the Hospital
compensation program including review of proposed
salary adjustments and updating the Hospital salary
l. promoting the development of equitable
compensation and employment practices and procedures;
m. consulting with management and employee on
compensation questions, unusual situations and
business issues impacting wages; and
n. developing, modifying and delivering compensation
communications for Hospital staff including group
(See Pl's Depo. at p. 6:1.14 p7:1.7 and Magee-Womens Hospital
Job Description for Manager, Compensation and Benefits, January
1997 (Date Reviewed)).
In April 1999, Magee and UPMC entered into a merger agreement.
Magee and UPMC planned to accomplish the merger within five (5)
years. Once the merger was announced, plans were developed to
integrate various Magee functions, including human resources,
into UPMC. Jane Tibbott, the Director of Human Resources for
Magee, who was 53 years of age in 1999, was responsible for
developing and recommending integration plans to Linda Antonelli,
who was 41 years of age in 1999, the Vice President Facilities
Planning and Support Services for Magee, and seeking approval of the Finance
Committee of Board of Directors of Magee.
As a result of the merger, the Compensation and Benefits
Department of Magee and its functions were merged into the
Compensation and Benefits Department of UPMC. (Pl's Depo. at p.
24:1.8-18, p. 63:1.16-21.)
At the time of the merger, UPMC had approximately 28,000
employees, including casual and temporary staff, and Magee had
approximately 2,100 employees, including Magee's research
foundation. (See Affidavit of John Galley, at ¶ 3; Pl. Depo. at
p. 11:1.15-19.) In addition, at that time, UPMC had approximately
25,000 pension plan and health and welfare benefits participants
and Magee had approximately 1,900 pension plan and health and
welfare benefits participants.
The first phase of the integration plan involved transferring
most of Magee's compensation functions to the Corporate
Compensation office at UPMC, which was directed by Charles
Donina; then age 52. Because Magee was adopting the UPMC
compensation program, including UPMC's salary structure,
Plaintiff no longer had to manage the performance and analysis of
salary surveys or the updating of the hospital salary structure.
Thus, the compensation portion of Plaintiff's job was eliminated
and on October 16, 2000, Plaintiff's job description was amended
to reflect the elimination of this portion of his job. (Pl's
Depo. at p. 8:1.14-9:1.4.)
The second phase of the integration plan included the adoption
of UPMC Health and Welfare benefit plans, transferring payroll
work to the UPMC Payroll Department, conversion to the PeopleSoft
human resources information system, and implementing KRONOS time
and attendance system. (Pl. Depo. at p. 13:1.5-8; Tibbott Affidavit
at ¶ 6.) A plan was submitted to the Finance Committee of the
Magee Board of Directors on March 28, 2001, which outlined the
impact of the integration. (Tibbott Affidavit, at ¶ 6.) The
results of the decision, as it related to Magee, included the
Elimination of Magee's payroll system and
department of the positions of 2.6 Full Time
Adoption of UMPC's Health and Welfare benefit
programs eliminated the need for Magee to administer
the Health and Welfare benefits, negotiate contracts
with vendors, maintain Summary Plan Descriptions,
develop employee communications, manage the annual
enrollment process, prepare government filings,
develop policies or programs based on pertinent
trends, and prepare financial reports.
Initially, approximately 80% of the retirement
plans administration would be transferred to the
Corporate Retirement Group, managed by Gregory
Stoner, then age 35, Director Retirement Benefits.
Mr. Stoner assigned the administration of the Magee
retirement plans to Joseph Giacomin, then age 54,
Senior Retirement Benefit Specialist, and Mr. Richard
McKerrow, then age 28, Retirement Specialist. Mr.
Stoner did not add staff in order to administer the
Magee retirement plans.
Adoption of UPMC pay practices eliminated the need
for Magee to develop its own compensation programs
The job of Data Coordinator was created to do the
employee data entry into the PeopleSoft system and
perform audits to insure data integrity; and
The job of HRIS Specialist was created to oversee
the PeopleSoft operations including coordinating
system upgrades, development of specialized reports,
acts as the liaison with UPMC payroll department to
resolve payroll issues and resolve time submission
issues with the KRONOS System, automated time and
(Tibbott Affidavit, at ¶ 6.) The PeopleSoft and KRONOS systems were integrated on December
16, 2001. The new positions of Data Coordinator and HRIS
Specialist were filled by individuals employed within Magee's
Human Resources Department, at a compensation level substantially
lower than the compensation Plaintiff was receiving. (Pl Depo. at
p. 67:1.17-21; Tibbott Depo. at p. 30:1.13-20.)
Elbea Smith, then age 33, whose payroll specialist position had
been eliminated as a result of the integration, and Holly Novak,
then age 27, whose benefit assistant position had been eliminated
as a result of the integration, were selected to fill the Data
Coordinator positions, which were clerical in nature. Evelyn
Gussenhofen, then age 34, whose payroll supervisor position was
eliminated, was selected to fill the HRIS Specialist position.
Plaintiff never expressed an interest or applied for either the
Data Coordinator or HRIS Specialist positions.
In May 2002, a Human Resources Representative position became
available and was posted. Plaintiff chose not to apply and
testified that he would not have been qualified for such
position. (Pl Depo. at p. 58:1.6-12.) Holly Novak applied for and
was promoted to the Human Resources Representative position. In
June of 2002, Toni Tesauro, then age 44, whose Benefits
Specialist position had been eliminated as a result of the
integration, was moved into the Data Coordinator position
previously held by Holly Novak.
The third phase of the integration involved moving the
administration of the retirement benefit plans over to UPMC.
(Tibbot Deposition, p. 12:1.8-11). Magee adopted the UPMC benefit
plans and the majority of Magee's pension plans were either
frozen or terminated following the merger and the employees of
Magee became participants in UPMC's plans. (Tibbot Depo. at p. 9:1.16-20.) The last remaining portion
of Plaintiff's job was with respect to retirement plans.
Plaintiff retained the responsibility for orienting employees
about the plans, filing regulatory information, making
arrangements for necessary distributions to employees,
maintaining the Summary Plan Descriptions and administering the
457f and 451 plans for the executives and wired monthly
contributions to the Central Pension Plan for employees who were
members of Local 95, International Union of Operating Engineers.
(Tibbott Depo. at p. 12:1.8-11.)
The record reflects that on October 24, 2002, Linda Antonelli,
Sue McCarthy, Vice President and Chief Financial Officer of
Magee, and Jane Tibbott met with John Galley, Vice President of
Compensation, Benefits and HRIS at UPMC, and Greg Stoner to
discuss the plan for completing the transfer of the remaining
administration responsibilities for all Magee retirement plans to
the UPMC Retirement Group.
The decision was made that January 1, 2003 would be the
effective date to complete the transfer of the remaining
retirement plan administrative responsibilities to the UPMC
Retirement Group. From December 2002 until April 2003, Plaintiff
worked with Joseph Giacomin and Richard McKerrow to complete the
transfer of the retirement plans administration to the UPMC
Benefits Department. (Tibbot Depo. at p. 31:1.12-16; Pl. Depo. at
p. 27:1.22-p. 28:1.4.)
By January 2003, approximately 95% of Plaintiff's job had been
transferred to UPMC. By the end of April 2003, the remainder of
Plaintiff's functions were also transferred over to employees at
UPMC. (Pl. Depo. at p. 26:1.5-10.) Plaintiff's job was eliminated effective April 29, 2003. At the
time, he was 59 years old. As part of the elimination of his job,
Plaintiff was offered a severance package based upon his position
level and years of service. (Tibbott Affidavit at ¶ 13.) He was
also informed that he was eligible for rehire and was encouraged
to view the UPMC website for job openings for which he could
After Plaintiff's position of Manager of Compensation and
Benefits was eliminated, Jane Tibbott notified Plaintiff of a
Compensation Specialist position opening in the Corporate
Compensation Department at UPMC. Plaintiff spoke to Charles
Donina, the Director of Compensation, with regard to the
position, but decided to withdraw himself from consideration for
the position. In addition, Jane Tibbott, recommended Plaintiff
for the position of Human Resources Director at UPMC St.
Margaret. Plaintiff, however, was not hired for that position.
Plaintiff testified that he understood that his position would
eventually be eliminated as a result of the Magee-UPMC merger.
(Pl Depo. at p. 56:1.1-5, 13-21.)
On December 29, 2003, Plaintiff filed a Complaint in this Court
in which he alleged wrongful termination against his former
employer, Magee Womens Hospital of University of Pittsburgh
Medical Center UMPC and UPMC t/d/b/a University of Pittsburgh
Medical Center, in violation of the Age Discrimination in
Employment Act ("ADEA"), 29 U.S.C. § 621 et seq.*fn1 STANDARD OF REVIEW
Summary judgment should be granted "if the pleadings,
depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no
genuine issue of material fact and that the moving party is
entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c).
Thus, the Court's task is not to resolve disputed issues of fact,
but to determine whether there exist any factual issues to be
tried. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-29
(1986). The non-moving party must raise "more than a mere
scintilla of evidence in its favor" in order to overcome a
summary judgment motion. Williams v. Borough of West Chester,
891 F.2d 458, 460 (3d Cir. 1989) (citing Liberty Lobby,
477 U.S. at 249)). Further, the non-moving party cannot rely on
unsupported assertions, conclusory allegations, or mere
suspicions in attempting to survive a summary judgment motion.
Id. (citing Celotex Corp. v. Catrett, 477 U.S. 317, 325
(1986)). Distilled to its essence, the summary judgment standard
requires the non-moving party to create a "sufficient
disagreement to require submission [of the evidence] to a jury."
Liberty Lobby, 477 U.S. at 251-52.
As stated above, Plaintiff claims that he was terminated from
his employment because of his age, in violation of the ADEA.
Defendants respond that they had a legitimate, nondiscriminatory
business reason for eliminating Plaintiff's position and
terminating his employment. The task of the Court is not to
second-guess employment decisions, but is instead to determine
whether the employment decisions were motivated by an illegal
discriminatory purpose. Ezold v. Wolf, Block, Schorr &
Solis-Cohen, 983 F.2d 509, 526-27 (3d Cir. 1992), cert.
denied, 510 U.S. 826 (1993). The ADEA provides that "it shall be unlawful for an employer . . .
to discharge any individual or otherwise discriminate against
any individual with respect to compensation, terms, conditions,
or privileges of employment, because of such individual's age."
29 U.S.C. § 623(a)(1). In order to establish a prima facie case
under the ADEA, a plaintiff is required to establish that (1) he
is over 40 years of age;*fn2 (2) he is qualified for the
position in question; (3) he was discharged; and (4) he was
replaced by (or the company retained) a sufficient younger person
to create an inference of job discrimination. Anderson v.
Conrail, 297 F.3d 242, 249 (3d Cir. 2002).
In an ADEA lawsuit, the familiar McDonnell Douglas
formulation*fn3 regarding the appropriate burdens of proof
and allocation of production of evidence govern and guide the
analysis of the evidence presented on a motion for summary
judgment. Keller v. Orix Credit Alliance, Inc., 130 F.3d 1101,
1108 (3d Cir. 1997) (en banc). Accordingly, the plaintiff bears
the initial burden of presenting a prima facie case.
The employer need only produce sufficient evidence to enable a
factfinder to conclude that the action taken was motivated by a
nondiscriminatory purpose. Fuentes, 32 F.3d at 763. If the
defendant is able to clear this relatively low hurdle, the
presumption evaporates and the onus is again on the plaintiff,
who bears the ultimate burden of showing that a discriminatory
purpose was a determinative factor in the decision. Id. at 764;
Bellissimo, 764 F.2d at 179-80. The plaintiff can either prove
this directly, by showing that discriminatory considerations motivated the defendant's actions, or indirectly,
by showing that the rationale provided by the defendant is
unworthy of credence. Josey, 996 F.2d at 638; Weldon,
896 F.2d at 797.
At trial, the plaintiff must prove both that the employer's
reason was false and that discrimination was the real reason for
the discharge. Fuentes, 32 F.3d at 763. However, the Court of
Appeals for the Third Circuit has held that the plaintiff's
burden is not as onerous when attempting to survive a summary
judgment. In such situations, the plaintiff need only demonstrate
that there are disputed factual issues concerning either (1)
whether the proffered reason for the discharge is false, or (2)
whether an invidious discriminatory reason was more likely than
not a motivating or determinative cause for the discharge. Torre
v. Casio, Inc., 42 F.3d 825, 830 (3d Cir. 1994); Fuentes,
32 F.3d at 764.
For purposes of this decision, the Court will assume that
Plaintiff has met his prima facie case. Therefore, the burden
shifts to Defendants to articulate some legitimate,
nondiscriminatory reason for their decision. Defendants argue
that legitimate business reasons exist for their decision to
terminate Plaintiff's employment. Namely, Defendants argue that
Plaintiff's position as Manager of Compensation and Benefits was
eliminated following the completion of the three-phase
integration plan, over an approximate five-year period of time.
During the first phase of the integration, which involved the
compensation functions, the compensation portion of Plaintiff's
job was eliminated. During the second and third phases of the
integration, Magee adopted UPMC's Health and Welfare benefit and
retirement programs, which eliminated the need for Magee to
administer such benefits, negotiate contracts with vendors,
maintain Summary Plan Descriptions, develop employee
communications, manage the annual enrollment process, prepare government filings, develop
policies or programs based on pertinent trends, and prepare
financial reports. Approximately 80% of the retirement plans
administration was transferred to UPMC's existing corporate
Retirement Group. Adoption of UPMC's pay practices eliminated the
need for Magee to develop its own compensation programs and
By the end of April 2003, the last of Plaintiff's functions,
which included signing employees up for benefits, explaining how
the benefits worked and processing withdrawals and retirements,
were also transferred over to employees at UPMC.
Because Defendants have articulated a legitimate,
non-discriminatory reason for their decision to terminate
Plaintiff's employment, the onus shifts back to Plaintiff to
show, by a preponderance of the evidence, that Defendants' stated
explanation is pretextual. Fuentes, 32 F.3d at 763.
Plaintiff responds that others in his department, whose
positions were eliminated, were hired into other positions, yet
Defendants failed to offer him these positions. However, the
Court finds and rules that there is evidence in the record which
demonstrates that Plaintiff was overqualified for those positions
and, more importantly, Plaintiff did not apply for or express
interest in those positions.
Plaintiff also argues that his job functions were given to
Richard McKerrow at UPMC, an individual who is under 40. However,
the record reflects that the only job functions that Mr. McKerrow
performed as to Magee's plans were ministerial and only took him
fifteen (15) minutes per day to perform. See McKerrow Affidavit
at ¶¶ 3-4. Specifically, such job functions included receiving
and processing enrollment forms and performing some calculations for Magee's 457(f) Plan. The record also reflects
that Joseph Giacomin, who was 56 years old at the time the Magee
plans were integrated into UPMC, took over all other functions
regarding Magee's retirement plans.
Courts examining similar factual situations have held that
elimination of an employee's position as a result of a merger is
a legitimate, non-discriminatory reason to eliminate an
employee's position. Chambers v. Metropolitan Prop. and Cas.
Inc. Co., 2002 U.S. Dist. LEXIS 11075 (D. Minn. June 13, 2002)
(employer's motion for summary judgment granted in ADEA case
where merger resulted in elimination of plaintiff's position);
Minton v. American Bankers Ins. Group, Inc., 2002 U.S. Dist.
LEXIS 7539 (S.D. Fla. April 24, 2002) (corporate reorganization
because of a merger which results in the elimination of a
position is a legitimate, non-discriminatory reason for
terminating an employee) (citing Tidwell v. Carter Prods.,
135 F.2d 1422, 1426 (11th Cir. 1998)).
The Court finds and rules that Plaintiff has failed to
demonstrate that Defendants' decision to eliminate his position
was guided by anything other than a desire to properly structure
the compensation and benefits department according to business
needs. Further, the Court finds and rules that the summary
judgment record is utterly devoid of any evidence which
demonstrates that Plaintiff's age was a factor in the Defendants'
decision to terminate Plaintiff's employment. Plaintiff has not
demonstrated that there was a continuing need for his same
services within the reorganized structure of Magee. It is
undisputed that most of Plaintiff's responsibilities were
eliminated due to the integration.
Plaintiff has simply failed to present any evidence to show
that age was a factor in Defendants' decision to terminate his
employment. Plaintiff has not demonstrated any weaknesses, implausibilities, inconsistencies, incoherencies or
contradictions in Defendants' proffered legitimate reason for its
actions. Keller, 130 F.3d at 1108-09. It is undisputed that
Plaintiff's job functions were eliminated as a result of the
integration. Accordingly, summary judgment will be granted to
Defendants on Plaintiff's claim of age discrimination.
For the reasons discussed supra, the Court finds that
Plaintiff has not shown by any evidence that Defendants
intentionally discriminated against him because of his age.
Therefore, the Motion for Summary Judgment filed by Defendants
will be granted in its entirety. An appropriate Order follows. ORDER OF COURT
AND NOW, this 11th day of October, 2005, in accordance with
the foregoing Memorandum Opinion, it is hereby ORDERED,
ADJUDGED, AND DECREED that the Motion for Summary Judgment filed
by Defendants Magee Womens Hospital of University of Pittsburgh
Medical Center, UPMC and UPMC t/d/b/a University of Pittsburgh
Medical Center (Document No. 17) is GRANTED and judgment is
hereby entered in favor of Defendants Magee Womens Hospital of
University of Pittsburgh Medical Center, UPMC and UPMC t/d/b/a
University of Pittsburgh Medical Center.
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