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David Cauvel v. Schwan Home Services

December 30, 2010


The opinion of the court was delivered by: Magistrate Judge Baxter


United States Magistrate Judge Susan Paradise Baxter.


A. Relevant Procedural History

On or about March 28, 2008, Plaintiff David Cauvel, a resident of Erie County, Pennsylvania, commenced this wrongful discharge action by filing a complaint in the Court of Common Pleas of Allegheny County, Pennsylvania, against his former employer, Defendant Schwan Home Services, Inc., a Minnesota corporation in the business of producing, selling, and distributing frozen food products. [ECF No. 1, Exhibit 1]. The action was removed to this Court by Defendant on May 5, 2008, pursuant to 28 U.S.C. § 1441(a), based on diversity of citizenship under 28 U.S.C. § 1332. [ECF No. 1]. Both parties have consented to the jurisdiction of the Magistrate Judge.

Plaintiff claims that Defendant's termination of his employment was wrongfully taken in retaliation for his refusal to submit to a polygraph test. As a relief for his claim, Plaintiff seeks to recover compensatory and punitive damages.

On May 23, 2008, Defendant filed an Answer, Affirmative Defenses and Counterclaim in response to Plaintiff's Complaint. [ECF No. 4]. The Counterclaim contains two Counts: breach of fiduciary duty and conversion. In support of these claims, Defendant asserts, among other things, that Plaintiff "either condoned and/or participated in the violation of corporate policy, which resulted in the loss of property." (Id. at ¶ 26).

On June 11, 2008, Plaintiff filed a motion to dismiss Defendant's Counterclaim, arguing that it failed to state a cause of action upon which relief may be granted. [ECF No. 5]. The Court denied Plaintiff's motion by Opinion and Order dated January 9, 2009. [ECF No. 13].

On July 17, 2009, Defendant filed an Amended Answer, Affirmative Defenses and Counterclaim [ECF No. 28], asserting several new allegations against Plaintiff, and adding claims of breach of contract and fraud. In response, Plaintiff filed an Answer and Affirmative Defenses to Defendant's Amended Counterclaim. [ECF No. 30]. The parties have since completed discovery.

On April 7, 2010, Defendant filed a motion for summary judgment, seeking entry of judgment in its favor, as a matter of law, based upon its assertion that the record evidence clearly shows that the termination of Plaintiff's employment was not based upon his refusal to take a polygraph test, as Plaintiff claims. [ECF No. 37]. On the same date, Plaintiff filed his own motion for summary judgment as to Defendant's counterclaim of "embezzlement," asserting that he is entitled to judgment in his favor on such claim because Defendant "lacks the proof necessary to support its allegations that Plaintiff either took the money himself, or conspired with others to take the money, or permitted others to embezzle the money." [ECF No. 41].*fn1 Each party has filed a brief in opposition to the other party's motion for summary judgment [ECF Nos. 39, 52], and Defendant has also filed a reply to Plaintiff's opposition brief. [ECF No. 52]. The parties have also filed multiple statements of material facts, which the Court has reviewed in detail. [ECF Nos. 38, 42, 47, 49, 51]. The following factual recitation is derived from the material facts that are either undisputed or supported by substantial evidence of record, and is confined to only those facts that relate to the claims now at issue before the Court.

B. Relevant Factual History

Defendant is in the business of producing, selling and distributing frozen food products to commercial and residential customers nationwide. (ECF No. 38, Defendant's Statement of Undisputed Facts, at ¶ 1). At all relevant times hereto, Plaintiff was employed by Defendant as the Location General Manager of Defendant's Erie Depot, where he managed approximately 15-17 employees, most of whom were route managers*fn2 and warehouse crew. (Id. at ¶ 3). As Location Manager, Plaintiff was responsible for following and enforcing Defendant's policies and procedures. (Id. at ¶ 13). Among them is Defendant's policy regarding employee theft of property, which states:

The theft, attempted theft or unauthorized possession of any property or money belonging to the Company, another employee or any other person or firm when such property is under the care of the Company, whether such property is of value or not, is grounds for immediate discharge.

You are expected and required to cooperate fully with the Company in any inspections or searches undertaken to determine compliance with this rule. (Id. at ¶¶ 16-17). In addition, Defendant maintains a Loss Prevention & Recoupment Policy regarding the making of bank deposits of cash and checks collected from the deliveries of goods sold, which states, in pertinent part:

It is an absolute responsibility that the Location General Manager ("LGM") will address missing deposits [or other] banking discrepancies of $50 cumulative or more per route manager per week by taking the following steps:

(1) On a daily basis, the LGM will review the daily deposit logs or A48 report (or its equivalent) to identify missing deposits;

(2) On a weekly basis, each Tuesday, the LGM will review the past weeks deposit log entries or will print and review the A48 Report (or equivalent) for the preceding work week (Sunday-Saturday). The purpose for reviewing each route manager at the depot is to identify field, office and banking shorts;

(3) For any route(s)/route managers showing a missing deposit, except for overnight(s), or a field cash and/or office adjustment ...

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