United States District Court, D. Minnesota
Stephen W. Cooper, Esq., and Stacey R. Everson, Esq., The
Cooper Law Firm Chartered, Minneapolis, MN, on behalf of
M. Lewis, Esq., John J. Wackman, Esq., and Jeremy D. Robb,
Esq., Nilan Johnson Lewis PA, Minneapolis, MN, on behalf of
MEMORANDUM OPINION AND ORDER
MONTGOMERY, U.S. DISTRICT JUDGE
November 30, 2017, the undersigned United States District
Judge heard oral argument on Defendants MAT Holdings, Inc.,
Midwest Air Technologies, Inc., MAT Industries, LLC, and
Sanborn Manufacturing Company's (collectively,
“Defendants”) Motion for Partial Summary Judgment
[Docket No. 260] and Motion to Exclude Expert Testimony
[Docket No. 333]. Plaintiff Douglas James Sellner's
(“Sellner”) Motion to Exclude Expert Testimony
[Docket No. 341] was also argued. For the reasons set forth
below, Defendants' motions are granted in part and denied
in part. Sellner's motion is granted.
factual background of this case is fully recited in this
Court's August 5, 2015 Memorandum Opinion and Order
[Docket No. 208] and is incorporated here by reference.
Sellner alleges that he was terminated from his employment as
a Quality Engineering Technician for refusing to falsify
testing data for certain models of air compressors.
Holdings, Inc. (“MAT Holdings”) is a privately
owned holding company owned by Steve Wang
(“Wang”). Second Ryan Decl. [Docket No. 263] Ex.
It owns companies that manufacture, market, and distribute
automotive and consumer business products and brands.
Id. Ex. 1. MAT Industries, LLC (“MAT
Industries”) and Midwest Air Technologies, Inc.
(“Midwest Air”) are two of MAT Holdings'
United States subsidiaries. Id. Ex. 3.
Industries markets air compressors, pneumatic driven air
tools, and pressure washers, which are sold by retailers and
home centers. First Ryan Decl. [Docket No. 162] Ex. 2
(“Thomas Dep.”) 198. MAT Holdings performs human
resource and administrative work for MAT Industries, for
which MAT Industries pays a monthly management fee to MAT
Holdings. Second Ryan Decl. Ex. 4 (“Nebel Dep.”)
2008, MAT Holdings purchased a facility in Springfield,
Minnesota known as Sanborn Manufacturing
(“Sanborn”). Id. Exs. 10 (“Stark
Dep.”) 14, 54; 11 (“Carnell Dep.”) 35-36.
MAT Industries refers to the facility as “Sanborn Mfg.,
a division of MAT Industries, LLC;” however, Sanborn is
not itself a legal entity. Defs.' Joint Separate Answer
[Docket No. 104] 1 n.1. Paul Thomas (“Thomas”)
serves as MAT Industries' Chief Operating Officer and
Butch Stark (“Stark”) is Sanborn's General
Manager. Thomas Dep. 7; Stark Dep. 14.
Sanborn manufactures air compressors
(“compressors”) with oil-lubricated,
single-stage, three-cylinder, 14 cubic-feet-per-minute pumps
(the “14CFM pumps”). Second Ryan Decl. Ex. 13
(“Beckman Dep.”) 65-68. The compressors operate
by a motor driving the pump, which then injects air into a
pressure vessel tank. The tank stores the compressed air.
Strong Decl. [Docket No. 171] ¶ 2. The amount of air
within the tank is controlled by a pressure switch which
turns the compressor on and off. Second Ryan Decl. Ex. 24
(“Swanson Dep.”) 52-53.
Industries manufactures the tank vessels at Sanborn and
purchases the remaining compressor components from third
parties. Beckman Dep. 60. In 2007, MAT Industries started
purchasing 14CFM pumps from Suzhou Honbase Machinery
Manufacture Co. (“Honbase”) (the “Honbase
pumps”) in China. Id. 67-68. Honbase is also
owned by Steve Wang. Id.
Honbase pumps struggled with excessive oil consumption and
leakage. Id. Ex. 15 (“Strong Dep.”) 92,
97. Sanborn's internal performance and life testing of
the Honbase pumps revealed that the pumps did not achieve
certain benchmarks set by Sanborn. Second Ryan Decl. Exs.
Sellner is Hired
2011, MAT Industries hired Sellner as a lab-quality
technician for the Sanborn facility. Id. Ex. 12.
Sellner's primary responsibility was to conduct testing
in the Sanborn testing lab, to collect corresponding testing
data, and report the data to engineers and supervisors.
Id. Ex. 27, Interrog. No. 9. Sellner was instructed
to report any safety, vendor quality, and manufacturing
issues. Id. Travis Strong (“Strong”),
MAT Industries' Quality Assurance and Product Service
Manager, was Sellner's direct supervisor. Strong Dep. 9;
Second Ryan Decl. Ex. 19 (“Sellner Dep.”) 114.
Sellner's first day at Sanborn, Strong explained to
Sellner that the Honbase pumps had serious problems with oil
leakage during testing. Sellner Decl. [Docket No. 184] ¶
3. Sellner observed oil leaking onto the floor, as well as
oil spitting from the pump units during the testing process.
Sears and Performance Testing
August 2011, MAT Industries and Sears, Roebuck and Company
(“Sears”) began working together to add a
compressor with the Honbase pump to Sears' Craftsman
product line. Second Ryan Decl. Ex. 28. On August 22, 2011,
MAT Industries forwarded the raw data from Test Request 136
(“TR136”), performance and life tests that were
initiated in late 2010, to Sears' Engineering Manager Dan
Swanson (“Swanson”). Id. Ex. 22. The
next day, Chief Operating Officer Thomas wrote an email to
Kurt Beckman (“Beckman”), Sanborn's
Engineering Manager, and stated that he was “not sure
[he] would approve these” based on the amount of oil
consumed during testing. Id. Ex. 29. Thomas
suggested a new round of testing that included pumps with
recent changes. Id.
was assigned to complete the new test, Test Request 321
(“TR321”), that evaluated whether changes
implemented by Honbase improved oil consumption and life
performance in the Honbase pumps. Id. Exs. 34-35.
Performance testing was completed on September 28, 2011.
Id. Ex. 42. All units passed performance testing.
Id. Exs. 42-43.
oil leakage, however, remained an issue. On January 12, 2012,
further testing revealed that adding a compression ring to
the pump reduced oil leakage. Id. Exs. 47-48. MAT
Industries required Honbase to add a compression ring on the
new pumps, and MAT Industries' existing inventory was
re-ringed. Id. Exs. 49-50.
February 15, 2012, Swanson asked MAT Industries for
additional performance and life test data on the Honbase
pump. Id. Ex. 54. The test request was directed to
Stark, who asked Sellner to assist because he had been
assigned TR321. Stark Dep. 124-125. On March 2, 2012, Sellner
sent Stark an internal Quality Department Laboratory Report
(“Quality Report”) on TR321 that stated: 1)
“[t]ests showed that units passed performance and life
testing benchmarks, ” and 2) the units passed
“with minor [n]ormal service issues.” Second Ryal
Decl. Ex. 43. Defendants contend that the life test data in
the Quality Report accurately reflects the raw life test data
on TR321 listed on a spreadsheet created by Sellner on
February 28, 2012. Sellner, however, asserts that the Quality
Report does not truthfully reflect the actual testing data to
TR321 and that he did not prepare the report. Id.
Ex. 59 ¶ 3.
the information from the Quality Report, Stark prepared a
Compressor Test Report (“CTR”). Id. Ex.
62. The CTR summarized that TR321 tested 80-gallon units and
concluded that the “pump test samples exceeded minimum
[l]ife test requirements set by customer.” Id.
Stark forwarded the CTR to Sellner with the instruction to
“go through the data I have entered to make sure that I
haven't made any mistake.” Id. Sellner
made two edits, and the CTR was sent to Swanson at Sears on
March 7, 2012. Id. Exs. 41, 63. Sellner contends
that the data sent to Sears in the CTR does not accurately
reflect the TR321 test results. First Everson Decl. [Docket
No. 206] Ex. 1 ¶ 3; Sellner Dep. 236.
Request to Falsify Data
March 29, 2012, Sellner alleges that Stark told him “to
get together everything [MAT Industries] had on the [Honbase]
pump.” Sellner Dep. 149. Following those instructions,
Sellner “updated the life test” by collecting all
relevant testing results and entering the results into a
spreadsheet. Id. Sellner delivered the data to
alleges later that same day, Engineering Lab Manager Joe
Schiller (“Schiller”) entered his office with a
copy of the spreadsheet Sellner had prepared and stated that
the testing results were “shit” and could not be
used in any summary report for Sears. Id. at 150.
Sellner further alleges that shortly thereafter, Stark
entered his office and claimed that MAT Industries had been
called “on the carpet” by Sears for overstating
the performance and quality of the Honbase pump. Id.
Stark instructed Sellner to produce a report showing that the
units did not have major issues and adequately passed life
tests of 1, 500 hours. Id. Sellner claims that when
he told Stark that no units had performed to those
specifications, Stark responded “well, if you don't
do this, we're all going to be on the street-no,
you're going to be on the street.” Id.
Sellner states that when he told Stark that he would not
falsify any testing records, Stark urged him to “get
creative with [his] documentation.” Id.
Beach (“Beach”) a lab technician, asserts that he
overheard portions of this conversation between Sellner and
Stark. Beach recalls hearing Stark telling Sellner that Sears
was “calling them on the carpet” for overstating
the performance of the Honbase pump, that Stark encouraged
Sellner to get creative with testing documentation, and that
Sellner refused Stark's command for creativity. First
Ryan Decl. Ex. 86 (“Beach Dep.”) at 130, 146-47.
Beach further claims that after the conversation with Stark,
Sellner stated, “Well, there's my job.”
Id. at 147.
that same day, March 29, 2012, Sellner alleges that Stark
persisted in pressuring him to complete an Executive Summary
with falsified data. Sellner Decl. ¶¶ 25-30.
Sellner continued to refuse. Id. ¶ 35.
According to Sellner, the next day Stark instructed him to
use go-cart data for the Executive Summary. Id.
¶ 39. Sellner responded that this would not be
appropriate. Id. Later on March 30, 2012, Sellner
called the Minnesota Department of Labor and Industry and the
Minnesota Occupational Safety and Health Administration
(“MNOSHA”). Id. ¶ 40. Beach reports
that he was in the room with Sellner when he made the call,
and that Sellner reported that he was instructed to
“doctor up some documentation.” Beach Dep. 49.
Sellner subsequently completed and submitted a MNOSHA form
online. Sellner Decl. ¶ 40.
Sellner Travels to China
was scheduled to travel to China with Strong on April 3, 2012
to evaluate Honbase's operations and implement
improvements to the Honbase pump. Sellner Dep. 123. The day
before their departure, Sellner alleges he received a call
from Swanson about Honbase pump data. Id. at 205.
Specifically, Swanson requested the raw life testing data for
the Honbase pump that did not reflect any major issues.
Id. 207-08. Sellner responded that there was no such
data in existence. Id. at 208. Swanson then told
Sellner that MAT Industries “should have worked the
bugs out before it was presented to Sears” and hung up.
Id. Swanson has no recollection of this conversation
with Sellner. Swanson Dep. 183-84.
on the plane to China with Strong, Sellner claims that he
told Strong about Stark's instruction to provide a
falsified report for Sears. Sellner Dep. 208. Strong
responded that “It would be best if I didn't hear
about this” and held his hands up in a gesture for
Sellner to stop talking. Id. Strong denies this
interaction took place. Strong Dep. 219-20.
in China, Sellner discovered manufacturing issues with the
Honbase pump, including use of pump testing equipment that
had not been accurately calibrated. Sellner Decl. ¶ 9.
Sellner's Performance Review and Promotion
March 5, 2012, Sellner received a positive performance review
from his immediate supervisor, Strong. Second Ryan Decl. Ex.
69. MAT Industries posted a Quality Assurance/Test Lab
Leadperson position opening on March 30, 2012. Id.
Ex. 79. After interviewing Sellner for the position, Strong
recommended that Sellner be promoted. Stark Dep. 43-44.
Strong's recommendation was approved by Stark, and
Sellner learned of his promotion just prior to his April 3,
2012 departure to China. Id.; Sellner Dep. 159.
Issues in ...