32 Fair empl.prac.cas. (Bna) 1451, 32 Empl. Prac. Dec. P 33,813 Jack Elliott, Plaintiffs-Appellees-Cross v. Group Medical & Surgical Service, Group Hospital Service, Inc., Defendant-Appellant-Cross

714 F.2d 556
CourtCourt of Appeals for the Fifth Circuit
DecidedSeptember 16, 1983
Docket82-2235
StatusPublished
Cited by2 cases

This text of 714 F.2d 556 (32 Fair empl.prac.cas. (Bna) 1451, 32 Empl. Prac. Dec. P 33,813 Jack Elliott, Plaintiffs-Appellees-Cross v. Group Medical & Surgical Service, Group Hospital Service, Inc., Defendant-Appellant-Cross) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
32 Fair empl.prac.cas. (Bna) 1451, 32 Empl. Prac. Dec. P 33,813 Jack Elliott, Plaintiffs-Appellees-Cross v. Group Medical & Surgical Service, Group Hospital Service, Inc., Defendant-Appellant-Cross, 714 F.2d 556 (5th Cir. 1983).

Opinion

714 F.2d 556

32 Fair Empl.Prac.Cas. (BNA) 1451,
32 Empl. Prac. Dec. P 33,813
Jack ELLIOTT, et al., Plaintiffs-Appellees-Cross Appellants,
v.
GROUP MEDICAL & SURGICAL SERVICE, et al., Defendants,
Group Hospital Service, Inc., Defendant-Appellant-Cross Appellee.

Nos. 81-2356, 82-2235.

United States Court of Appeals,
Fifth Circuit.

Sept. 16, 1983.

Seay, Gwinn, Crawford, Mebus & Blakeney, John F. McCarthy, Jr., Jerry K. Warren, Dallas, Tex., for defendants.

Mandell & Wright, Eliot P. Tucker, Houston, Tex., for plaintiffs-appellees-cross appellants.

John F. McCarthy, Jr., Jerry K. Warren, Dallas, Tex., for defendant-appellant-cross appellee.

Appeal from the United States District Court for the Southern District of Texas.

Before THORNBERRY, GEE and REAVLEY, Circuit Judges.

GEE, Circuit Judge:

The Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. ("ADEA"), was enacted on December 15, 1967 (effective June 12, 1968), following the completion of a study by the Secretary of Labor required by Congress when it enacted the Civil Rights Act of 1964.1 The ADEA's announced goal is the "elimination of discrimination from the workplace," Lorillard v. Pons, 434 U.S. 575, 577, 98 S.Ct. 866, 868, 55 L.Ed.2d 40 (1978), by "[p]romoting employment of older persons based on their ability rather than age ... [and] prohibit[ing] arbitrary age discrimination in employment." 29 U.S.C. § 621(b). To this end, the ADEA provides statutory protection to individuals aged forty through seventy. Id., § 631(a). This appeal concerns a suit brought pursuant to the ADEA by six protected former employees (collectively referred to as "appellees") of Group Hospital Service, Inc. ("Hospital Service"), appellant. In the district court, the jury found, inter alia, that these former employees had been willfully discriminated against because of age. Concluding that the evidence adduced at trial was insufficient to support the jury's verdict, we reverse the judgment of the district court.

Background and Procedural History

Two major contentions are before us. The first concerns the sufficiency of the evidence to support the jury's finding of age discrimination and certain attendant procedural issues. The second centers upon the propriety of a prophylactic order of the district court. The district court denied appellees' motion for liquidated damages. However, it granted a motion for a supersedeas bond to protect appellees' interest in the event this court determined that that ruling was in error.2

Because the procedural posture of the present action is somewhat complicated and because our resolution of the procedural issues guides our analysis, we delineate the facts as developed below with some care. The record reflects that sometime during April of 1978 Walter Hachmeister learned that he was president-elect of Hospital Service, an insurance company incorporated under the laws of Texas and doing business as Blue Cross-Blue Shield of Texas.3 In preparation for his role as president Hachmeister began to assemble a management team and to review the company's past performance.4 Hachmeister's analysis concluded that Hospital Service could increase both the efficiency of its sales operations and its market penetration by consolidating its Life and Marketing Divisions so as to eliminate overlapping in their respective sales functions. In consequence, Hachmeister implemented a plan to accomplish this goal upon assuming the presidency.

Under this reorganization a number of top executives in the Marketing Division were purged: (1) Richard Galen was replaced as an Assistant Vice President; (2) George Spradley was relieved of his duties as Manager of National Accounts; (3) Robert Heffer was replaced as Houston North District Manager; (4) Duane Thompson was replaced as Sales Training Director; and (5) Jack Elliott was ousted as Regional Sales Manager for the Houston Region. In addition, subsequent to the reorganization, Max Tipton was replaced as Manager of the Abilene Regional Office.5 Each of the above-mentioned executives were within the ADEA's protected age group. More, each, with the exception of Tipton, was either given notice of termination or terminated between October 1978 and January 1979,6 and filed notice pursuant to 29 U.S.C. § 626(d) with the Department of Labor of his intent to sue Hospital Service, Group Medical and Surgical Service, and Group Life and Health Company. Tipton filed a corresponding notice on June 29, 1979. On October 22, 1979, these former employees, acting in concert, filed suit in the United States District Court for the Southern District of Texas. The gravamen of their complaint was that they had been willfully discriminated against because of age.

The defendant companies answered that appellees were indeed terminated and that they were within the ADEA's protected age group at the time of their termination. In addition to conceding that appellees had been replaced by persons outside of the ADEA's protected age group, they urged that Group Medical and Surgical Service and Group Life and Health Company were improperly joined as party defendants. At the close of appellees' case in chief, the district court instructed a verdict as to all defendants except Hospital Service. Hospital Service, in turn, moved to dismiss the claims of Elliott, Galen and Heffer for failure "to fulfill the jurisdictional prerequisites required to maintain an action under the provisions of the Age Discrimination in Employment Act of 1967." See Fed.R.Civ.P. 12(b)(6). In sum, Hospital Service urged that the district court did not have jurisdiction to entertain the complaints of these parties because they had failed to file a notice of intent to sue within 180 days after the occurrence of the discriminatory action complained of. See 29 U.S.C. § 626(d)(1). Appellant also argued that plaintiffs Galen, Tipton and Spradley had failed to establish a prima facie case. See Price v. Maryland Casualty Co., 561 F.2d 609 (5th Cir.1977). The district court carried the former motion with the case and denied the latter.

At the close of its case in chief, Hospital Service proffered the following motion: "to dismiss on the grounds that plaintiff failed to make a prima facie case."7 The district court permitted the case to go to the jury. In response to special issues, the jury found that Hospital Service had discriminated against each of the named plaintiffs by discharging him from his employment because of his age and that the discharges were willful. The jury awarded damages aggregating over one million dollars to the plaintiffs in amounts for which the district court subsequently entered final judgment, adding attorneys' fees and costs. As noted above, the district court declined to award liquidated damages despite the jury's finding of willfullness.

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