Needham v. Beecham, Inc.

515 F. Supp. 460, 26 Fair Empl. Prac. Cas. (BNA) 235, 1981 U.S. Dist. LEXIS 12055, 26 Empl. Prac. Dec. (CCH) 31,869
CourtDistrict Court, D. Maine
DecidedMay 12, 1981
DocketCiv. 76-173 P
StatusPublished
Cited by12 cases

This text of 515 F. Supp. 460 (Needham v. Beecham, Inc.) is published on Counsel Stack Legal Research, covering District Court, D. Maine primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Needham v. Beecham, Inc., 515 F. Supp. 460, 26 Fair Empl. Prac. Cas. (BNA) 235, 1981 U.S. Dist. LEXIS 12055, 26 Empl. Prac. Dec. (CCH) 31,869 (D. Me. 1981).

Opinion

MEMORANDUM OF OPINION AND ORDER OF THE COURT

GIGNOUX, Chief Judge.

Plaintiff Richard P. Needham brings this action under the Age Discrimination in Employment Act of 1967, as amended, (ADEA), 29 U.S.C. §§ 621-34, against his former employer, Beecham, Inc. Plaintiff, who was 41 years old at the time, alleges that defendant terminated his employment because of his age in violation of Section 623(aXl) of the Act. He seeks declaratory and injunctive relief, and damages. Juris *462 diction is asserted under 28 U.S.C. §§ 1331, 1332, 2201. The complaint was filed in this Court on December 2, 1976.

The action has been tried to the Court, without jury, and the issues have been comprehensively briefed and argued by counsel. The following memorandum opinion contains the Court’s findings of facts and conclusions of law as required by Fed.R.Civ.P. 52(a).

I.

THE FACTS

A. Background: Plaintiff’s Employment

Plaintiff began working as a salesman for S. E. Massengill Co., Inc., a manufacturer of pharmaceutical products, in October 1962. Plaintiff’s sales territory initially encompassed only northern Maine, but by 1970 had expanded to include the entire state except York County.

Massengill merged with defendant in 1971. After the merger, plaintiff continued to work for defendant’s Beecham-Massengill Pharmaceuticals Division. Defendant’s pharmaceutical products were marketed through a national sales force that was divided into regional sales areas, then further subdivided into district sales areas. Plaintiff continued to work until his termination the same 15 counties in Maine that he had worked before the 1971 merger; this territory fell within the New England District of the Northeast Region.

Plaintiff’s work chiefly entailed promoting the use of Beecham-Massengill products by doctors and hospitals in his territory, and selling those products to pharmacies and hospitals. Traveling throughout the state, plaintiff visited doctors, hospitals and pharmacies daily; showed them various portfolios of product lines; and attempted to sell the product. He called upon an average of five to seven physicians per day, and recorded his visits in detail on “daily call reports.”

Because his work required travel throughout the state, plaintiff divided his territory into several areas (Portland, Lewis-ton, Bangor, and Aroostook County, for example), and worked in each area for about one week at a time. While working in those areas that were too far to permit commuting from his home in Stillwater, Maine, plaintiff maintained an expense account. Defendant reimbursed him for meals and motel expenses. In addition, defendant provided him with a company car; paid for the maintenance of the car; and reimbursed him for gasoline expenses.

After the 1971 merger, the general procedure for expense reimbursement was as follows. Actual payment to a salesman was effected by means of a weekly “travel letter,” a negotiable instrument which the salesman made payable to himself. Thus, every week plaintiff could negotiate a travel letter and pay himself for the out-of-pocket expenses incurred that week. Defendant permitted reimbursement up to a specified amount. (In 1971 the weekly expense ceiling was $90; at the time of plaintiff’s termination, he was allowed $110 per week.) Every two weeks plaintiff submitted to his District Manager an expense report with all receipts attached. After approval by the District Manager, the report and receipts were sent to the Regional Manager, who approved the submission and sent them to defendant’s central office in Bristol, Tennessee for a final check.

B. Events Leading Up to Plaintiff’s Termination

In September 1973, an employee in defendant’s central office brought to the attention of defendant’s Chief Accountant, Harold Robinson, an audit of plaintiff’s expense reports. Robinson reviewed those reports as well as plaintiff’s file, and concluded that some of plaintiff’s expenses appeared inconsistent and high. Robinson informed Alan Karp, the Northeast Regional Manager, of his findings. On September 20, 1973, Robinson sent to Karp a second memo, which reported that a review of plaintiff’s car maintenance file revealed “strange circumstances:” plaintiff’s average monthly car maintenance costs were high because he had purchased 16 new tires *463 in an 18-month period, from December 1971 to May 1973. Robinson noted the plaintiff had received a new car in October 1971. These reports caused Karp to review plaintiff’s file and conclude further investigation was necessary.

After Karp had reviewed plaintiff’s file, he contacted Matt Chrostowski, plaintiff’s District Manager, and arranged for Chrostowski to make a field contact visit with plaintiff in October 1973. A field contact visit was a routine practice in which a district manager accompanied a salesman on his business rounds for several days. Chrostowski flew to Augusta on Monday, October 22, and accompanied plaintiff for the remainder of that day and the next. He flew out of Augusta on Wednesday, October 24. They stayed at the Roundhouse Motor Inn in Auburn on Monday and Tuesday nights and checked out Wednesday morning.

Following Chrostowski’s field contact visit, expense reports submitted by plaintiff were reviewed. Two such reports pertaining to recent expense periods raised suspicion.

The expense report submitted by plaintiff for the period in which Chrostowski had made his field contact visit appeared to claim excessive reimbursement for motel expenses. Although Chrostowski reported that plaintiff had checked out of the Roundhouse Motor Inn with him on Wednesday, October 24, plaintiff’s expense report recorded a stay of four nights (instead of two) at $14.44 per night, totaling $57.76. Attached to the expense report was a handwritten receipt for payment of $57.76. The receipt bore the signature of “Cecilia Talpey,” who was later learned to be a desk clerk at the Roundhouse Motel.

Robinson asked William Hepburn, defendant’s Division Comptroller, to audit plaintiff’s expense report for the period October 22 to November 2, 1973. Hepburn called the Roundhouse Motor Inn and spoke with the proprietor, Richard Alphen. Hepburn was told that it was not the customary practice of the motel to issue handwritten receipts. In addition, he spoke with a woman who identified herself as Ms. Talpey. After checking the motel records, she reported that plaintiff had stayed there three nights — October 22, 23 and 24, 1973, and had checked out on October 25, paying a total bill of $43.52. Hepburn informed Karp of his finding. Karp then telephoned Marion Jones, defendant’s Vice President, and forwarded to him in Bristol, Tennessee, plaintiff’s reports.

The second expense report which appeared to raise problems was the expense report for September 24 to October 5, 1973. Attached to this report was another handwritten motel receipt — this one from the Stagecoach Inn in South Portland.

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Bluebook (online)
515 F. Supp. 460, 26 Fair Empl. Prac. Cas. (BNA) 235, 1981 U.S. Dist. LEXIS 12055, 26 Empl. Prac. Dec. (CCH) 31,869, Counsel Stack Legal Research, https://law.counselstack.com/opinion/needham-v-beecham-inc-med-1981.