University of Michigan Law School
Civil Rights Litigation Clearinghouse
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Case Name Pagliolo v. Guidant Corp. EE-MN-0084
Docket / Court 0:06-cv-00943-DWF-SRN ( D. Minn. )
State/Territory Minnesota
Case Type(s) Equal Employment
Special Collection Private Employment Class Actions
Case Summary
On March 1st, 2006, a group of former employees of Guidant Corporation filed a lawsuit under 28 U.S.C. § 2201 against Guidant Corporation in the United States District Court for the District of Minnesota. The plaintiff, represented by private counsel, asked the court for declaratory judgment that ... read more >
On March 1st, 2006, a group of former employees of Guidant Corporation filed a lawsuit under 28 U.S.C. § 2201 against Guidant Corporation in the United States District Court for the District of Minnesota. The plaintiff, represented by private counsel, asked the court for declaratory judgment that the Severance Agreement and Release of Claims was invalid under the Older Workers Benefits Protection Act ("OWBPA"). The plaintiffs claimed that employment Releases given by Guidant Corporation failed to comply with the OWBPA and were invalid. Plaintiffs also asked the Court for summary judgment on Guidant's counterclaims in the case, which were for declaratory judgment under 28 U.S.C. § 2201 that the employment Release was valid under OWBPA. Guidant also made counterclaims for unjust enrichment, restitution, recoupment, and setoff, and breach of contract.

In 2004, Guidant Corporation began developing "Project Apple," which was a codename for a Reduction in Force (RIF). Guidant began selecting employees at the local level whose employment would be terminated. Ultimately, over 700 employees were informed their employment would be terminated. As part of the "RIF," these employees were given notice for eligibility of benefits. Each terminated employee received a package of documents including a cover letter, a copy of the Severance Agreement and Release of Claims (the "Release"), a statement of Severance Pay and Benefits, along with a Severance Eligibility Disclosure.

One plaintiff, Joseph Pagliolo, ultimately used information in the Severance Eligibility Disclosure to perform an analysis that led to his choice in not signing the Release. His calculations showed that a disproportionate number of employees ages 40 and older had been affected by the RIF. This information led to forming the case at hand in which employees claim Guidant had engaged in age discrimination when terminating the 700 employees.

Specifically, the plaintiff claimed that Exhibit B, the employment Release form, violated the OWBPA. Within an employment release form, there are certain statutory requirements that must be met or else it is ineffective under the law.

On June 11th, 2007, plaintiffs filed a motion for class certification, and the Court approved the class on September 28th, 2007.

The Court (Judge Donovan W. Frank) found that Guidant Corporation did not meet statutory requirements for various parts of the employment Release form that was part of employees' severance packages. First, the Court held that the Release form contained material misrepresentations that failed to satisfy OWBPA. The form included a list of employees who were redeployed for employment as part of the group of employees eligible for severance benefits. This material misrepresentation had the effect of making it appear that there were 10% fewer terminations of employees ages 40 and older. The Court also found that the Release form did not disclose the decisional unit for the RIF and did not give employees a document that explained the eligibility factors for the RIF. Lastly, the Court found that Guidant did not satisfactorily fulfill the age and job formatting requirements. Guidant failed to provide the age on the Project Apple Spreadsheet, but rather only included birthdates.

On September 28th, 2007, the Court ordered that the Releases signed by plaintiffs under the Older Workers Benefits Protection Act were void, with respect to plaintiffs' claims under the Age Discrimination in Employment Act. The Court dismissed defendants' counterclaims for declaratory judgment and breach of contract. The Court also denied defendants' motion for partial summary judgment.

Julianne Nowicki - 07/28/2010


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Issues and Causes of Action
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Issues
Affected Gender
Female
Male
Discrimination-area
Demotion
Hiring
Pay / Benefits
Discrimination-basis
Age discrimination
General
Pattern or Practice
Causes of Action Declaratory Judgment Act, 28 U.S.C. § 2201
Age Discrimination in Employment Act (ADEA), 29 U.S.C. §§ 621 et seq.
Defendant(s) Guidant Corporation
Plaintiff Description Former Guidant employees ages 40 and older that were terminated from their positions due to age discrimination
Indexed Lawyer Organizations None on record
Class action status sought Yes
Class action status granted Yes
Prevailing Party Plaintiff
Public Int. Lawyer No
Nature of Relief
Source of Relief Litigation
Form of Settlement Court Approved Settlement or Consent Decree
Order Duration not on record
Case Closing Year 2008
Case Ongoing No
Additional Resources
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Case Studies Megacases, Diversity, and the Elusive Goal of Workplace Reform
Written: Mar. 01, 2008
By: Nancy Levit (University of Missouri-Kansas City School of Law)
Citation: 49 B.C. L. Rev. 367 (2008)
[ Detail ] [ External Link ]

  Second Generation Employment Discrimination: A Structural Approach
By: Susan Sturm (Columbia Law School)
Citation: 101 Colum. L. Rev. 458 (2001)
[ Detail ] [ External Link ]

Docket(s)
0:06-cv-943 (D. Minn.) 12/24/2008
EE-MN-0084-9000 PDF | Detail
PACER [Public Access to Court Electronic Records]
General Documents
Complaint 03/01/2006
EE-MN-0084-0001 PDF | Detail
Document Source: PACER [Public Access to Court Electronic Records]
ORDER FOR DISMISSAL WITH PREJUDICE OF PLAINTIFFS JUDY MATHIOWETZ AND PATRICIA WILKE 06/05/2007 (D. Minn.)
EE-MN-0084-0003 PDF | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Plaintiffs’ Motion for Conditional Certification and Mailing of Notice to Similarly Situated Individuals 06/11/2007
EE-MN-0084-0002 PDF | Detail
Document Source: PACER [Public Access to Court Electronic Records]
MEMORANDUM OPINION AND ORDER 09/28/2007 (2007 WL 2892400) (D. Minn.)
EE-MN-0084-0004 PDF | WESTLAW | Detail
Document Source: PACER [Public Access to Court Electronic Records]
ORDER OF DISMISSAL WITH PREJUDICE 12/23/2007 (D. Minn.)
EE-MN-0084-0005 PDF | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Judgment 12/24/2008 (D. Minn.)
EE-MN-0084-0006 PDF | Detail
Document Source: PACER [Public Access to Court Electronic Records]
Judges Frank, Donovan W. (D. Minn.)
EE-MN-0084-0003 | EE-MN-0084-0004 | EE-MN-0084-0005 | EE-MN-0084-0006 | EE-MN-0084-9000
Monitors/Masters None on record
Plaintiff's Lawyers Bertelson, Beth E. (Minnesota)
EE-MN-0084-9000
Foster, Wood R. Jr. (Minnesota)
EE-MN-0084-0001 | EE-MN-0084-0002 | EE-MN-0084-9000
Gengler, William A. (Minnesota)
EE-MN-0084-9000
Kalis, Sara B. (Minnesota)
EE-MN-0084-9000
Karwin, Robert P. (California)
EE-MN-0084-9000
Leishmann, David D. (Minnesota)
EE-MN-0084-9000
Lewis, Jordan M. (Minnesota)
EE-MN-0084-0001 | EE-MN-0084-0002 | EE-MN-0084-9000
Mabley, Frank T. (Minnesota)
EE-MN-0084-0001 | EE-MN-0084-0002 | EE-MN-0084-9000
Markiewicz, Julianne M. (Minnesota)
EE-MN-0084-9000
Nauen, Charles N. (Minnesota)
EE-MN-0084-9000
Ostapowich, Andrea R. (Minnesota)
EE-MN-0084-9000
Pierce, Patricia V. (Pennsylvania)
EE-MN-0084-0001 | EE-MN-0084-0002 | EE-MN-0084-9000
Schmit, Robert J. (Minnesota)
EE-MN-0084-9000
Snyder, Stephen J. (Minnesota)
EE-MN-0084-9000
Stange, Cynthia (Minnesota)
EE-MN-0084-0001 | EE-MN-0084-0002 | EE-MN-0084-9000
Streitz, Jay B. (Minnesota)
EE-MN-0084-0001 | EE-MN-0084-9000
Defendant's Lawyers Blickenstaff, Leslie S. (Massachusetts)
EE-MN-0084-9000
Cross, Tonya M. (California)
EE-MN-0084-9000
Hartstein, Brian A. (Illinois)
EE-MN-0084-9000
Mazura, Adrianne Clarise (Illinois)
EE-MN-0084-9000
Nagle, James W. (Massachusetts)
EE-MN-0084-9000
Norton, Beth A. (Massachusetts)
EE-MN-0084-9000
Prokott, Daniel G. (Minnesota)
EE-MN-0084-9000
Robbins, Holly M. (Minnesota)
EE-MN-0084-9000
Rosenbaum, Laura E. (Massachusetts)
EE-MN-0084-9000
Schroeder, Joel P. (Minnesota)
EE-MN-0084-9000
Shepherd, Heidi Goldstein (Massachusetts)
EE-MN-0084-9000
Snider, Jerry W. (Minnesota)
EE-MN-0084-9000
Van Oort, Aaron D. (Minnesota)
EE-MN-0084-9000
Wyatt, Benjamin J. (Massachusetts)
EE-MN-0084-9000
Other Lawyers None on record

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