Lunda Construction Co. wins case

Daily Reporter (Milwaukee), Apr 29, 2002 by Ellen Hickock-Wall

A 12-member jury deliberated for less than two hours Friday before deciding that Lunda Construction Company did not mislead former employee Timothy Galarnyk about a corporate profit-sharing plan.

Galarnyk, Eau Claire, sued the Black River Falls construction company for more than $600,000, claiming that the firm owed him:

$423,000 in unpaid profit-sharing funds

$56,000 for a discrepancy in salary paid during 1999

$127,000 in an unpaid bonus for 1999

"I came with nothing and left with nothing," Galarnyk said after the verdict was read. "Corporate America beat me up again."

Asked whether he plans to appeal the verdict, Galarnyk said he doesn't know.

"I have to discuss that with my attorneys," he said. "There are still a lot of issues out there."

The trial, heard by Judge Robert G. Mawdsley in Waukesha County Circuit Court, began Tuesday morning and continued throughout the week.

During his tenure with the company, Galarnyk said his primary relationship was with Milt Lunda, founder of the company.

At a meeting of upper management in December 1995, Milt Lunda presented a plan to share somewhere between 20 percent and 25 percent of the company's profits with its employees, using a three-tier compensation plan.

But the senior Lunda then turned over the presidency to his son, Larry, early in 1996.

After Milt Lunda's retirement, the new president admittedly did not follow through on his father's profit-sharing plan because he didn't like it.

"Larry Lunda disagrees with profit sharing," said defense attorney James W. Greer, Milwaukee. "He has his own business plan, and that is to pay them more. The compensation of Mr. Galarnyk and other people rose sky high during Larry Lunda's plan."

Managers not told

The younger Lunda, however, did not communicate to managers his decision not to follow through with his father's plan.

The crux of the lawsuit was for jurors to decide whether a promise made by Milt Lunda, who remained with the company as chairman of the board after his retirement, and broken by his son still constituted a promise by the company.

"It's a promissory case," said Gregory Cook, Wausau, one of Galarnyk's attorneys.

The first question posed to jurors was, "Did Lunda Construction make a promise to its employees to pay profit sharing in addition to bonuses?"

All 12 jurors answered no.

The bulk of the damages Galarnyk was asking for in the lawsuit, nearly $423,000, hinged on that one question.

During closing arguments, another of Galarnyk's attorneys, James Ryan of Wausau, also talked about promises.

"You've got to treat people with dignity, and if you promise them something and you don't want to carry out that promise, tell them," he said. "Just tell them. That's all. They may be the employees, but they're not the slaves. Tell them. Treat them with dignity."

Greer argued that no promise was made to the employees.

"It was made to a number of upper-level executives," Greer said. "Of the 125 employees in this firm who would have received bonuses, 18 found out about it."

Galarnyk owns and operates Construction Risk Management Services, with offices in Eau Claire and Hillside, Ill.

Ellen Hickok-Wall can be reached at 414-276-0273, Ext. 118.