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A claim of age discrimination fails if the plaintiff is replaced by someone just three years his junior and can’t point to any “direct” evidence of age-related bias, a federal judge has ruled. In his 19-page opinion in Fakete v. Aetna Inc., U.S. District Judge John R. Padova of the Eastern District of Pennsylvania dismissed a suit brought by a man who said he was the oldest employee in U.S. Healthcare’s auditing department prior to its merger with Aetna and that he was fired by Aetna just three months before his pension would have vested. Stephen Fakete’s lawyer, Andrew M. Smith of Marcino Bowman & Smith in Fort Washington, Pa., argued that Fakete’s termination was the result of an unwritten “corporate challenge” by Aetna to save $30 million by getting rid of older employees nearing retirement to save on salary, pension and health care benefits. But Aetna’s lawyers — Eric J. Bronstein, John M. Elliott, Brian J. McCormick and Raymond J. Santarelli of Elliott Reihner Siedzikowski & Egan — argued that none of the evidence Fakete pointed to as smoking-gun proof of age discrimination was, in fact, direct evidence. As a result, they argued that Fakete was required to proceed under the “pretext” theory. And under that theory, they said, he couldn’t even make out a prima facie case since his replacement was just three years younger. Smith argued that Fakete, who was 56 at the time of his December 1998 firing, was actually replaced by a 34-year-old woman. But Judge Padova sided with Aetna on that point and found that although Fakete’s post remained vacant for eight months, his exact job duties were ultimately given to a 53-year-old man. According to court papers, Fakete was hired by U.S. Healthcare in April 1992 as an audit consultant. In 1996, USHC merged with Aetna to form Aetna U.S. Healthcare. At the time of the merger, Fakete was 54 years old and the oldest audit consultant at USHC. The merger agreement prevented Aetna from terminating any USHC employees for at least two years following the merger, absent approval from an USHC executive. That agreement expired in July 1998, when Fakete was 56 years old and eligible to retire on a substantial pension within three years. In September 1998, Aetna offered Fakete a transfer to the position of vice president of technical services in the area of disaster recovery planning. The promotion, however, was overruled by Diane Souza, Aetna’s supervisor of internal auditing. Fakete claimed that the denial of the promotion was due to his age and was an effort by Aetna to reduce its future liability for retirement benefits. Aetna later altered Fakete’s duties, and he received a written warning about unexplained absences from the workplace. The warning listed objectives that Fakete had to meet and required him to use specific methods to achieve the objectives. But Fakete complained that he could not meet the objectives because Aetna terminated his e-mail. In December 1998, Aetna fired Fakete for violations of the warning and falsification of expense reports. In his suit, Fakete accused Aetna of willful age discrimination and retaliation. But Padova found that the retaliation claim was flawed because Fakete failed to mention it in his initial filings with the Equal Employment Opportunity Commission. Fakete complained that after his termination, he applied for temporary benefits from the Pennsylvania Department of Labor and revealed his complaints of age discrimination and wrongful termination. Using the results of an audit of his expense accounts, Aetna successfully contested his application for unemployment benefits. A referee denied the request for benefits in January 1999. Aetna’s lawyers argued that Fakete failed to exhaust his administrative remedies under the ADEA because he never mentioned the retaliation claim in his EEOC charge. Padova agreed, saying he found that none of Fakete’s EEOC filings gave Aetna notice of his retaliation claim. “The retaliation claim is outside the scope of an investigation that can reasonably be expected to grow out of plaintiff’s [EEOC] charge,” Padova wrote. “The retaliation claim is not an explanation of the original charge or a natural outgrowth of the original charge but involves a separate action taken by Aetna in the unemployment benefits hearing that was not described or clearly referenced in the charge.” Aetna argued that the remaining claims should also be dismissed because Fakete could not make out a prima facie case. But Smith argued that since Fakete had direct evidence of age discrimination, there was no need for proof of a prima facie case. Fakete testified that Souza, Aetna’s vice president and director of internal audit, told him that the audit department workers were career workers, and anyone with at least five years experience should update their marketing skills because they would be rotated into another division of the company. But Padova noted that Souza “did not single out [Fakete], but instead addressed her remarks in a general meeting to the more experienced employees in the auditing department.” Fakete also quoted his supervisor as saying that Aetna’s new management would not be favorable to him because they were looking for “younger single people that will work unlimited hours.” Finally, Fakete quoted a manager in another division of Aetna as saying that he believed Aetna would rotate out many senior employees. Fakete said he believed the man felt that he was being targeted and just wanted to “survive another year until he could get their earlier retirement package.” But Padova found that none of the alleged quotes was direct evidence of discrimination. “Souza’s remark is not directly related to age, but instead refers to years of experience which is only tangentially connected to, and certainly not dispositive of, an employee’s age,” Padova wrote. “Furthermore, Souza was not speaking about terminating such employees, but instead referred to moving them into different divisions within Aetna.” Even though Souza was allegedly directly responsible for denying Fakete’s promotion, Padova found that her remark — even when interpreted in Fakete’s favor — directly contradicted any age discrimination claim since Souza was essentially saying that “more experienced employees would receive preferential treatment with respect to transfers.” The supervisor’s statement also was not direct evidence of discrimination, Padova found, “because it was a stray remark that did not directly reflect the decision-making process of any particular employment decision.” And the other manager’s remark couldn’t be considered, Padova said, because he was not involved in any decision relating to Fakete. As a result, Padova agreed with Aetna that Fakete’s only viable theory would be pretext. But the threshold test for such cases, Padova said, is proof of a prima facie case in which the plaintiff must show that he was replaced by a younger worker. Fakete failed that test, Padova said, because “courts generally require proof that the plaintiff was replaced by a person who is younger than he by at least seven years.” In Gutknecht v. Smithkline Beecham Clinical Laboratories, Padova said, another Eastern District judge wrote: “Although no uniform rule exists, it is generally accepted that when the difference in age between the fired employee and his or her replacement is fewer than five or six years, the replacement is not considered ‘sufficiently younger,’ and thus no prima facie case is made.” But Smith argued that a jury should decide whether Aetna replaced Fakete with 53-year-old Harvey Slegel — as it claims — or instead with 34-year-old Cathy Beech who was hired two months before Fakete was terminated. But Padova found that Smith had not produced any valid evidence to dispute Aetna’s claim that Fakete’s job was ultimately given to Slegel. “The only inference that could rationally be derived from admissible evidence is that Slegel was not hired until eight months after plaintiff was terminated and after plaintiff filed a claim for age discrimination with the EEOC. That alone is insufficient to create a genuine dispute of fact that Slegel was not plaintiff’s replacement,” Padova wrote.

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