Opinion
Case No. 00 C 4008.
September 25, 2002
ORDER
Plaintiff Robert Ostgulen alleges that his former employer, Lumbermans Mutual Casualty Co. ("Lumbermans"), terminated him because of his age in violation of the Age Discrimination in Employment Act of 1967 ("ADEA"), 29 U.S.C. § 621-34. Lumbermans moves for summary judgment. For the reasons set forth below, the motion is granted.
The facts relayed in this opinion are undisputed unless otherwise noted. Summary judgment motions in this district must be supported by a statement of material facts that the movant contends are undisputed. N.D. Ill. Local R. 56.1(a). Lumbermans complied with this rule. "All material facts set forth in the statement required of the moving party will be deemed to be admitted unless controverted by the statement of the opposing party." N.D. Ill. Local R. 56.1(b)(3)(B). Ostgulen responded to many of Lumbermans's assertions of fact by stating that he "can neither admit nor deny this paragraph because he does not know." (E.g., Pl.'s Resp. Def.'s Rule 56.1 Statement ¶ 7.) These facts are deemed admitted. See McGuire v. United Parcel Service, 152 F.3d 673, 675 (7th Cir. 1998) ("An answer that does not deny the allegations in the numbered paragraph with citations to supporting evidence in the record constitutes an admission.").
In May 1997, Lumbermans created an entity known as "KemperChoice" for the purpose of growing its "Personal Lines" business in Illinois. KemperChoice was located in Freeport, Illinois. In July 1997, Lumbermans hired Ostgulen, then 46 years of age, to serve as Vice President of Underwriting at KemperChoice, with responsibility for both the underwriting and pricing of personal insurance products. KemperChoice operated at a loss at all times during its existence, losing approximately 11 to 12 million dollars from its inception through July 1999, including one million dollars per month in calendar year 1999. Ostgulen himself admitted that KemperChoice's loses were increasing during 1999 and that, as a member of KemperChoice's management team, he was responsible for a portion of these losses. In May 1999, Dale Hammond, Executive Vice President of Lumbermens' Personal Lines Group, sent all of the group, including KemperChoice, a letter emphasizing that it was Lumbermans's goal to cut its "combined ratio" for the entire group to 100% or below. The combined ratio measures the amount of losses paid out and expenses incurred as compared to the amount of premium dollars taken in. When Hammond made the decision to terminate Ostgulen and other members of the KemperChoice management team, KemperChoice's "combined ratio" was in excess of 150% and trending upwards. On July 15, 1999, Hammond announced this decision and explained to Ostgulen that he was terminated because he "was in a key role, in that he had responsibility for underwriting and pricing and was a member of the senior management team, making decisions that drove the profitability of the company, as [were three other Vice Presidents terminated at the same time]." (Def.'s Rule 56.1 Statement ¶ 32.) The terminated officers were not replaced. After concluding that KemperChoice could not be made profitable or salvaged, Lumbermans shut it down in October 1999.
Ostgulen concedes that he has no direct evidence of age discrimination, relying instead on the indirect method of proof. See McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973). Under this burden-shifting approach, the plaintiff must first establish a prima facie case by demonstrating that: "(1) he was in the protected age group [i.e., at least 40 years of age]; (2) he was performing according to his employer's legitimate expectations; (3) he suffered an adverse employment action; and (4) similarly situated, substantially younger employees were treated more favorably." Biolchini v. General Elec. Co., 167 F.3d 1151, 1153-54 (7th Cir. 1999) (citing McDonnell Douglas, 411 U.S. at 802); see also 29 U.S.C. § 631(a) ("The prohibitions in [the ADEA] shall be limited to individuals who are at least 40 years of age."). It is undisputed that Ostgulen was at least 40 years of age when he was fired, so he has satisfied the first and third elements.
Ostgulen pins his showing as to the fourth element on Brian Harger, the former Vice President of Operations at KemperChoice, who was retained after Ostgulen was fired. Although Lumbermans concedes that Harger was less than 40 years old on July 15, 1999, Ostgulen provides no evidence as to Harger's precise age or birth date. The omission is potentially significant because "inference of discrimination is appropriate only when the employer favors `substantially' younger persons, a term [the Seventh Circuit has] defined operationally as `ten years or more.'" Scott v. Parkview Mem. Hosp., 175 F.3d 523, 525 (7th Cir. 1999). At the time he was fired, Ostgulen was 48 years old. If Harger was 39 years old in July 1999, Ostgulen loses. Lumbermans does not press the point, however, so this court will assume that Harger is in fact ten years or more younger than Ostgulen.
In addition to showing that Harger is "substantially younger," Ostgulen must show that Harger was "similarly situated." The parties dispute whether Harger was a member of the decision-making team at KemperChoice and whether he was, like Ostgulen, eligible to receive Long-Term Incentive bonuses or officers' bonuses. For present purposes, the court resolves both issues in Ostgulen's favor. On the other hand, it is undisputed that: Harger had 13 to 14 years of prior experience working at Lumbermans's headquarters in Long Grove, Illinois in its computer division (Def.'s Rule 56.1 Statement ¶ 12); Harger came from Long Grove to Freeport as a favor to get the Freeport operation started (id. ¶ 42); Harger's and Ostgulen's backgrounds and experience differed (Ostgulen Dep. at 210); one of Harger's primary or principal duties at KemperChoice related to the computer system and Harger was better qualified than Ostgulen to perform these tasks (id.); if asked in 1999 to assess Harger's performance, Ostgulen "would have said as far as I knew, he was doing okay" (id. at 197); Hammond was the sole decision-maker with regard to Ostgulen's termination (Def.'s Rule 56.1 Statement ¶ 33); Hammond believed that Harger was meeting or exceeding all of his performance objectives (id. ¶ 41); unlike Ostgulen and two of the other terminated officers, Harger was not involved in a proposed rate revision plan (Ostgulen Dep. at 186); and Hammond regarded the plans submitted to him as unacceptable and cited this as a reason for his decision to terminate Ostgulen and the others (Def.'s Rule 56.1 Statement ¶ 31). Finally, in response to Lumbermans's claim that Hammond did not believe Harger had a decision-making role in terms of activities which determined the overall profitability of the company, Ostgulen asserts that Harger "had a key role in that KemperChoice's expense ratio depended on his group." (Pl.'s Resp. Def.'s Rule 56.1 Statement ¶ 40 (citing Ostgulen Aff. ¶ 15).) Ostgulen himself admitted that the expense ratio remained constant during 1999, while the overall ratio worsened. (Ostgulen Dep. at 148.) In light of these differences, no reasonable factfinder could conclude that Harger and Ostgulen were similarly situated.
Accordingly, this court grants Lumbermans's motion for summary judgment.