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Haskell v. Kaman Corp.

decided: August 15, 1984.


Appeal from a judgment of the District of Connecticut, Jose A. Cabranes, Judge, awarding plaintiff-appellee $323,000 in damages and $87,566 in attorneys fees and costs for age discrimination in violation of the Age Discrimination in Employment Act, 29 U.S.C. § 621-34. Cross appeal from a judgment denying plaintiff liquidated damages.

Mansfield, Meskill and Cardamone, Circuit Judges.

Author: Mansfield

MANSFIELD, Circuit Judge:

Defendant Kaman Corporation (the "Company") appeals from a judgment of the District of Connecticut, Jose A. Cabranes, Judge, awarding plaintiff Weston B. Haskell, Jr., $283,000 compensatory damages, $40,000 special damages, and $87,566 in attorney's fees and costs pursuant to a jury determination that the Company unlawfully terminated Haskell's employment on account of his age in violation of the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. §§ 621-34. On appeal, the Company argues that the district court erred in denying its motion for a judgment notwithstanding the verdict, in admitting certain allegedly prejudicial testimony into evidence over its objection, and in failing to instruct the jury that it must find that Haskell was replaced by a younger person. Haskell cross appeals, arguing that the district court erred in not ordering a new trial on the question of whether the Company's actions were willful, entitling him to liquidated damages. We reverse and remand for a new trial on the question of whether Haskell's discharge violated the ADEA. We affirm the judgment denying Haskell liquidated damages.

Charles Kaman ("Kaman") founded the Company in 1945 for the purpose of developing and manufacturing a new military helicopter. At the outset, the Company had only three employees. By the early 1960's these increased to approximately 4500 employees, nearly all of whom were engaged in the manufacture of helicopters. However, the Company's helicopter operations began to decline in the mid-1960's, leading it to diversify its operations. It developed an acoustical fiberglass-backed guitar that became the largest seller of its kind, produced parts and assemblies for commercial and military aircraft, and serviced commercial aircraft at various airports in Connecticut, Nebraska, and Florida. In the early 1970's it entered into two new businesses: the sale and distribution of bearings and the distribution of musical instruments. By 1978, the bearing business accounted for about 40 percent of the Company's total sales and about one-half of its total profits. By the mid-1970's it had five major product groups -- aerospace products, sciences, aviation services, music, and bearing sales and distribution -- and 17 subsidiaries. By 1978 it had 3,700 employees and annual revenues of $214 million.

Haskell joined the Company in 1958 as an assistant to the president, Kaman. Throughout his twenty-year tenure with the Company Haskell worked in public and investor relations and reported directly to Kaman. Until 1971, Haskell was director of public relations; thereafter, he was a vice-president. Haskell's most important job responsibility was the production of the annual report. As the Company grew and diversified, the reports became more elaborate and the task of coordinating the production of the report with the five product heads more difficult. Moreover, in addition to producing the annual report, Haskell oversaw the production of the Company's annual 10-K report for the Securities Exchange Commission and coordinated press and investor relations and corporate advertising. From 1973 until March 1978 an outside public relations firm, Lowengard & Brotherhood, selected by Haskell, assisted him in the Company's corporate advertising and investor relations program.

During Haskell's last years with the Company, there were problems with the production of the annual report. In 1972, the Company had to reprint the report because of the poor print quality of the photographs reproduced in it. Because Haskell was on vacation at the time, others in the Company oversaw the corrections. In 1974, the annual report failed to identify itself as such on its cover. More serious problems accompanied the 1976 report. The discussion of the music division was later deemed to be inadequate and several pages of the report had to be re-written and reprinted, causing delays in the mailing of the report to the shareholders. In the aftermath of the problems with the 1976 report Kaman placed Lucian Baldwin in charge of the production of the 1977 report and 10-K statement, with Haskell serving as Baldwin's assistant.

Early in 1977 Kaman became angry with Haskell over another incident. A news account had appeared in the local press alleging the contamination of a community well in Moosup, Connecticut, by a Company plant. Kaman blamed Haskell, who was in charge of press relations, for the unfavorable coverage. Haskell decided to tape his future telephone conversations with reporters; this further incensed Kaman who ordered Haskell not to tape anyone ever again.

The 1976 annual report and the Moosup well incident strained relations between Haskell and Kaman. Haskell conceded at trial that he and Kaman were having "difficulty communicating" following these mishaps. At the end of 1977 the Company cut Haskell's annual bonus from $10,000 to $5,000, with a net result that Haskell's annual compensation in 1977 was the same as in 1976. Haskell was the only Company officer whose compensation did not increase in 1977. The Company's corporate guidelines indicate that a $5,000 bonus suggests "above average" job performance, whereas a $10,000 bonus suggests "outstanding" performance.

In 1978 Haskell was involved in another incident that disturbed Kaman. The Company's public relations firm, Lowengard & Brotherhood, telephoned security analysts and bankers who had attended a November 1977 presentation by Kaman and asked them for their candid opinion of Kaman's presentation. Lowengard & Brotherhood tape-recorded their replies without their knowledge and sent the results to Haskell on February 6, 1978. Haskell passed the report along to Kaman without comment. Shortly thereafter Kaman met with other senior officers of the Company concerning Haskell and decided to fire him. On April 7, 1978, Kaman told Haskell that he was fired. Haskell testified that Kaman gave no substantive reasons for his termination, merely stating that "the company had grown or changed, and that [Kaman] had been able to grow or change with it, and that [Haskell] had not been able to." To Haskell's comment that "employees who reach the age of 55 or 20 years with the company didn't seem to last," Kaman responded, "that's the way it seems to be." Haskell was 57 years old at the time of his termination.

After Haskell's departure, 53-year old Lucian Baldwin performed the most substantial part of Haskell's tasks -- the production of the annual report and the 10-K statement. Baldwin hired an assistant, 29-year-old Mary Jo Keating, who took over the public relations duties formerly carried out by Lowengard & Brotherhood. The extent to which Keating performed some duties formerly carried out by Haskell rather than by the agency is disputed.

At trial there was no direct evidence that the Company terminated Haskell because of his age. Nor did Haskell testify to statements along such lines by Kaman or any of the Company's senior officers. Instead, Haskell relied upon a few comments made by Kaman during the 15-year period from 1960 to 1975, alleged to suggest prejudice against older employees, to which the Company objected. Specifically, Haskell testified that in the early 1960's Kaman had referred to two Company employees as "old ladies with balls"; that in the early 1970's Kaman had mentioned a Reader's Digest article discussing a medical theory that aging involves a series of small strokes; and that Kaman had used the term "young turks" in 1974 or 1975 to refer to some of the younger employees in the Company.

Also over the Company's objection Haskell testified to the emotional difficulties he had experienced since his termination. The following colloquy took ...

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