Masek v. The Cadle Co., 95-WPC-1 (ALJ Mar. 7, 1997)

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Masek v. The Cadle Co., 95-WPC-1 (ALJ Mar. 7, 1997)

DATE ISSUED: MARCH 7, 1997

CASE NO: 95-WPC-1

In the Matter of

RAY MASEK
Complainant

THE CADLE COMPANY
Respondent

APPEARANCES:

James Franks, Esq.
Raymond J. Masek, Esq.
For the Complainant

John M. Manos, Esq.
For the Respondent

BEFORE: MICHAEL P. LESNIAK
Administrative Law Judge

RECOMMENDED DECISION AND ORDER ON DAMAGES

This is a proceeding brought under the Water Pollution Control Act, 33 U.S.C. 1367; Clean Air Act, 42 U.S.C. 7622; the Toxic Substance Control Act, 15 U.S.C. 2622, and the regulations promulgated thereunder at 29 C.F.R. Part 24. The Secretary of Labor has been given responsibility pursuant to said statutes to investigate complaints by employees, or persons acting on their behalf, of discrimination action by employers.

I issued a Recommended Decision and Order on Liability only on March

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11, 1996 finding in favor of the Complainant, Ray Masek. Masek's complaint alleged violations of the various statutes set out in pargraph one above. His evidence showed there were five underground storage tanks currently abandoned at 4041 Jennings Road. (CX 6)¹ These tanks had been inoperative/abandoned since prior to January 3, 1991. A conbustible gas explosion hazard existed as determined during the soil gas survey conducted by VADOSE Research, Inc. The gas was largely composed of Methane. Also oil seepage was observed at the north end of the property. Water exhibiting a petroleum hydrocarbon sheen was observed exiting the storm sewer and entering the Cuyahoga River.

The Secretary of Labor has the responsibility to enforce the employee protection provisions pursuant to all of the federal statutes mentioned in the complaint. 29 C.F.R. §24.1. In reviewing the Congressional declaration of goals of these various Acts, which seek to protect public health and environment by promoting the prompt cleanup of hazardous waste sites whether the threat be in the ground, our waterways, or the air we breathe. All of the statutes have similar employee protection provisions although all of the remedies are not the same.

Given Complainant's evidence, I find that all of the federal statutes mentioned by Complainant in his complaint were appropriate since his evidence showed a potential health and environmental threat to a waterway, the air and ground.

Damages

I. 1994

The parties agreed that Masek worked for The Cadle Company for 17 weeks and was paid $9,636 or 566.82 per week. (TR 2, page 55)² They also agreed that Masek was paid until August 26, 1994. (TR 2, pages 49-50) The evidence shows that Masek's only mitigation for the year 1994 was unemployment compensation in the amount of $3,210. (TR 2, page 57)³ I calculate for the year 1994, Masek is owed back pay in the amount of $6,992.76. This represents 18 weeks lost pay for the year 1994 minus $3,210 in mitigation.

II. 1995 and the Issue of Reinstatement

Respondent filed "Notice of Newly Discovered Grounds Warranting Termination" on May 11, 1995. This Notice is dated May 5, 1995 and in questioning Respondent's counsel on the subject, Respondent is satisfied that May 5, 1995 represents the date that Respondent discovered grounds warranting Masek's termination. (See discussion at TR 2, pages 182-193). These grounds are fully set out in Respondent's Notice and I find are supported by the testimony of Victor Buenke both during the hearing of October 29, 1996 and deposition taken on July 22, 1996 and by the testimony of William Shaulis taken by deposition on July 22,

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1996. These grounds are also supported by the documents provided by Masek's former employers, Reliance Electric Company and Copperweld Steel Company. These grounds involve reasons given by Masek as to why he left these two companies, lawsuits filed by Masek against these companies, Buenke's testimony that had he known of the true facts, he would not have recommended Masek for hire (TR 2, pages 168-177) and Shaulis' testimony on July 22, 1996 he would have fired Masek upon learning of misinformation given by Masek. (See deposition transcript pages 57-61). After considering the testimony of Mr. Masek himself, I find that he was not completely honest and forthright with during his interviews with Victor Buenke and William Shaulis and the wrongdoing was of such severity that Masek would have been terminated on those grounds alone had the employer known of it at the time of the discharge. Therefore, neither reinstatement nor front pay is an appropriate remedy. It would be both inequitable and pointless to order the reinstatement of someone the employer would have terminated, and will terminate, in any event and upon lawful grounds. Once an employer learns about employee wrongdoing that would lead to a legitimate discharge, it cannot be required to ignore the information, even if it is acquired during the course of discovery in a suit against the employer and even if it might have gone undiscovered absent the suit. The beginning point in formulating a remedy should therefore be calculation of back pay from the date of the unlawful discharge to the date the new information was discovered. The court can also consider any extraordinary equitable circumstances that affect the legitimate interests of either party. McKennon v. Nashville Banner Publishing Company, 513 U.S. 352; 115 S.Ct. 879 (1995).

For the year 1995, I find back pay in the amount of $7,790.76. This represents 18 weeks lost pay, from 1/1/95-5/5/95 at $566.82 per week minus $2,412 ⁴ in mitigation. I note Respondent's argument in mitigation filed November 12, 1996, however, Complainant testified that he saw his first client in April, 1995; I have reviewed his federal income tax returns ⁵ which are signed under the penalties of perjury and I find by the greater weight of the evidence that Masek's sworn response to my interrogatory is fair and reasonable mitigation. I invite Respondent's motion for recommendation on this issue if Respondent is convinced that I am wrong. Frankly, I was surprised to learn that Complainant was intermingling money received by his law business with his personal funds. He testified that he sold personal property and all money received from whatever source went into his personal checking account. He did not establish an operating account and trust account until 1996. (See TR 2, pages 67-73). Finding mitigation here could be a nightmare but for his sworn testimony that he saw his first client in April, 1995. (TR 2, page 72 and Masek deposition pages 9-11).

III. Emotional Distress and Exemplary Damages

All of the statutes set out in Complainant's complaint provide for compensatory damages for emotional distress. The Toxic Substances Control Act also provides for exemplary damages. 15 U.S.C. §2622(B)(1)(B). Considering Complainant's testimony he could theoretically make out a case for both compensatory damages and exemplary damages. (See TR 2, pages 88-100), see also My Recommended Dec. & Order on Liability, page 17,

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paragraph 5 and footnote 2). However, considering the information acquired duirng the course of discovery, concerning Complainant's interview with William Shaulis and Victor Buenke and the reasons he gave for leaving Reliance and Copperweld Steel's employ and after considering the reasons given by Reliance and Copperweld, the Clean-Hands Doctrine precludes my recommendation of compensatory damages for emotional distress and exemplary damages.

Respondent's Closing Brief filed November 12, 1996

I have found that the evidence in this case shows a violation of all of the federal statutes cited by the Complainant in his complaint including the Toxic Substance Control Act. In my Recommened Dec. & Order of March 11, 1996, I cited several cases wherein complaints to local authorities are protected under Department of Labor Whistleblower provisions, including Helmstetter v. Pacific Gas and Electric Company, 91-TSC-1, Sec. Dec., January 13, 1993. In that case, the Secretary held that Complainant's report to the fire department and his cooperation with the district attorney's office was protected activity. It would be inconsistent for the Secretary to find protected activity in a Toxic Substance Control Act case concerning complaints to local authorities and not to find protected activity in the other statutes mentioned in the complaint for the very same activity. For this reason, Respondent's request for reconsideration is denied.

Respondent once again has asked me to withdraw from the case indicating the record establishes that I was pre-disposed to find in Claimant's favor. My only response is that all of the reasons I found for Claimant on liability and damages lie in my Recommended Dec. And Order on Liability issued March 11, 1996 and in this opinion. Respondent refers to a January 11, 1996 order which I will recite verbatim here:

ORDER DENYING MOTION TO STRIKE

Upon Respondent's Motion To Strike The Deposition of Investigatory David Rodenhausen, having read Respondent's Motion and said deposition transcript of Mr. Rodenhausen taken on November 9, 1995, Respondent's Motion is DENIED. However, I will disregard any references to Mr. Rodenhausen's investigative report and conclusions contained in the transcript.

IT IS SO ORDERED.

While my order may have been inartfully drawn, what I meant was that I would disregard Mr. Rodenhausen's conclusions but instead would rely on my own conclusions. I believe that is exactly what I did. I based my conclusions on what Mr. Shaulis told Rodenhausen which I considered to be admissions against interest. (See Recommended Dec & Order of March 11, 1996, pages 12 & 19.)⁶ For these reasons, Respondent's motion that I withdraw from the case and reverse my decision on liability is denied.

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Recommended Order On Damages

1. The Cadle Company will pay Complainant compensatory damages for back pay in the amount of $14,783.52.

2. The Cadle Company will pay Complainant attorney's fees in the amount of ,725. This amount will be paid directly to Complainant's attorney James D. Franks, Esq., 3637 State Route 5, Suite 6, Cortland, Ohio 44410 since his bill remains unpaid. I find Attorney Franks' statement for services and supporting affidavit fair and reasonable.

3. Cadle Company will pay Complainant $860.03 for the costs of depositions and $189.22 for other costs associated with this litigation.⁷

MICHAEL P. LESNIAK
Administrative Law Judge

NOTICE: This Recommended Decision and Order and the administrative file in this matter will be forarwarded for final decision to the Administrative Review Board, United States Department of Labor, Room S-4309, Frances Perkins Bldg., 200 Constitution Ave., N.W., Washington, D.C. 20210. See 61 Fed. Reg. 19978 and 19982 (1996).

MPL/cs/bg

[ENDNOTES]

¹ This exhibit was admitted during the hearing which commenced on June 20, 1995.

² TR 2 refers to the transcript fo the October 29, 1996 hearing.

³ I note that during Masek's deposition, he testified after being fired by The Cadle Company, he saw his first client around April, 1995 and other than unemployment compensation, he had no other source of income between August, 1994 and April, 1995. (See Masek deposition taken September 26, 1996), pages 9-11).

⁴ See Masek's response to my special interrogatories filed November 12, 1996.

⁵ Masek's income tax return shows an adjusted gross income of $2,137. If I were to add back his capital loss of $3,000 and divide by 12, this would result in a monthly gross of $428. Multiplying $428 x 4 months (until May 1, 1995) would result in mitigation in the amount of ,712, less than his response to my interrogatory.

⁶ See also Rodenhausen deposition dated Nov 9, 1995 page 11, line 23-page 12, line 9.

⁷ Respondent objected to awarding Claimant money for postage and phone charges as awarding these damages would result in compensating Claimant twice. Respondent felt that Claimant was reducing his income by deducting these amounts as expenses and double dipping would occur if Claimant was awarded these amounts. However, Claimant tesstified that he did not deduct these amounts as exponses. (TR 41).