Opinion
Civil No. 3:03-CV-1175-H.
August 24, 2004
MEMORANDUM OPINION AND ORDER
Before the Court are Defendant's Motion for Summary Judgment, filed July 13, 2004; Plaintiff's Response, filed July 27, 2004; and Defendant's Reply, filed August 6, 2004. Also before the Court are Plaintiff's Objections and Motion to Strike Defendant's Summary Judgment Evidence, filed July 27, 2004; Defendant's Response, filed August 17, 2004; Defendant's Objections and Motion to Strike Plaintiff's Evidence Filed in Response to Defendant's Motion for Summary Judgment, filed August 6, 2004; Plaintiff's Response, filed August 19, 2004; and Defendant's Motion for Leave to File Supplemental Appendix Instanter, filed August 18, 2004. The Court will address the Objections and Motions to Strike as necessary to rule on Defendant's Motion for Summary Judgment. Upon review of the pleadings, briefs, and relevant authorities, the Court is of the opinion for the reasons stated below that Defendant's Motion for Summary Judgment should be DENIED.
I. BACKGROUND
Plaintiff Larry Florer ("Florer") worked as a sales representative for Electronic Data Systems ("EDS"), a company in the global information services industry, beginning February 23, 1991, and ending July 2, 2002, when Florer was laid off. (Def.'s App. at 35, 127.) Florer was a successful salesperson of EDS's billing software, known as IXPlus, including recognition as a top sales executive by inclusion in EDS's "Inner Circle" nine years in a row and as a "Top Performer" three years in a row. (Pl.'s App. at 1.) In the late 1990s, Florer was promoted to the most senior sales position at EDS, known as a Client Sales Executive III ("CSE III"). ( Id.; Def.'s App. at 128.) Although most CSE IIIs sell EDS products and services to Tier I companies, i.e., companies that sell over two billion dollars in revenue annually, Florer's position as a CSE III was to sell products and provide services to Tier II companies, i.e., companies with annual revenues less than two billion dollars. (Pl.'s App. at 5-6.) According to Florer, at the time of his discharge, Florer was the most senior person in his position and the only member of the Tier II telecommunications sales team; he was also approximately three years shy of earning fully matured pension benefits. (Pl.'s App. at 1.) For reasons that are disputed by the parties, Florer's sales fell short of the quotas set by EDS in 2000 and 2001. (See Pl.'s App. at 7-8; Def.'s App. at 410, 415-16.) In 2001, two employees were added to the Tier II telecommunications sales team. (Pl.'s App. at 5.) In July 2002, however, after falling short of financial projections and suffering a significant decline in stock value (Def.'s App. at 486), EDS effected a reduction in force by discharging over 2,000 employees, including Florer and the other two Tier II sales team employees. (Def.'s App. at 486.) Florer's sales accounts were distributed to younger employees, who continued selling products or providing services to those accounts.
Defendant's Objection to Florer's Declaration is OVERRULED as to the parts cited in this opinion.
Plaintiff's Objection to Yancey's Declaration is OVERRULED as moot.
On May 28, 2003, Florer filed the instant case claiming wrongful termination resulting from age discrimination pursuant to the Age Discrimination in Employment Act, 29 U.S.C. § 621 ("ADEA"). Defendant has moved for summary judgment on all claims.
II. SUMMARY JUDGMENT STANDARD
Summary judgment is appropriate where the facts and law as represented in the pleadings, affidavits, and other summary judgment evidence illustrate that no reasonable trier of fact could find for the non-moving party as to any material fact. FED.R.CIV.P. 56; Lujan v. National Wildlife Federation, 497 U.S. 871, 888 (1990); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323-25 (1986); Innovative Database Systs. v. Morales, 990 F.2d 217 (5th Cir. 1993). "The moving party bears the initial burden of identifying those portions of the pleadings and discovery in the record that it believes demonstrate the absence of a genuine issue of material fact, but is not required to negate elements of the nonmoving party's case." Lynch Properties, Inc. v. Potomac Ins. Co. of Ill., 140 F.3d 622, 625 (5th Cir. 1998) (citing Celotex, 477 U.S. at 322-25). If the movant fails to meet its initial burden, the motion must be denied, regardless of the nonmovant's response. Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994).
If the movant does meet its burden, the nonmovant must go beyond the pleadings and designate specific facts showing that a genuine issue of material fact exists for trial. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Edwards v. Your Credit, Inc., 148 F.3d 427, 431 (5th Cir. 1998). A party opposing summary judgment may not rest on mere conclusory allegations or denials in its pleadings unsupported by specific facts presented in affidavits opposing the motion for summary judgment. FED. R.CIV. P. 56(e); Lujan, 497 U.S. at 888; Hightower v. Texas Hosp. Assn., 65 F.3d 443, 447 (5th Cir. 1995).
In determining whether genuine issues of fact exist, "[f]actual controversies are construed in the light most favorable to the nonmovant, but only if both parties have introduced evidence showing that a controversy exists." Lynch, 140 F.3d at 625; Evans v. City of Houston, 246 F.3d 344, 348 (5th Cir. 2001); see also Eastman Kodak v. Image Technical Services, 504 U.S. 451 (1992). However, in the absence of any proof, the Court will not assume that the nonmoving party could or would prove the necessary facts. Lynch, 140 F.3d at 625. A party must do more than simply show some "metaphysical doubt as to the material facts." Matsushita, 475 U.S. at 586. "If the record, taken as a whole, could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial." Friou v. Phillips Petroleum Co., 948 F.2d 972, 974 (5th Cir. 1991).
III. ANALYSIS
As noted above, EDS moves for summary judgment on all of Florer's claims. EDS argues that summary judgment is appropriate because Florer cannot establish a prima facie case of age discrimination and because he cannot establish that EDS's legitimate, non-discriminatory reason for Florer's termination was a pretext for unlawful discrimination.
A. Prima Facie Case
The ADEA, as amended, makes it unlawful for an employer "to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age." 29 U.S.C. § 623(a). The Court evaluates discrimination claims that rely on circumstantial evidence, including age discrimination claims arising under ADEA, using the burden-shifting approach from McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973). See Reeves v. Sanderson Plumbing Prods. Inc., 530 U.S. 133, 141 (2000); West v. Nabors Drilling USA, Inc., 330 F.3d 379, 383 (5th Cir. 2003); Long. v. Eastfield College, 88 F.3d 300, 304 (5th Cir. 1996). The Supreme Court developed this approach "to deal with cases in which discrimination can be proved only by circumstantial evidence." Evans v. City of Houston, 246 F.3d 344, 350 (5th Cir. 2001) (citing Reeves v. Sanderson Plumbing Prods. Inc., 530 U.S. 133 (2000)).
To overcome summary judgment, the plaintiff is first required to establish a prima facie case of discrimination by showing that plaintiff was 1) a member of a protected class; 2) qualified for the position held at the time of discharge; 3) actually discharged; and 4) replaced by someone not within the protected class, i.e., someone younger, otherwise discharged as a result of plaintiff's age, or "treated less favorably than similarly situated younger employees." Smith v. City of Jackson, Miss., 351 F.3d 183, 196 (5th Cir. 2003); Russell v. McKinney Hosp. Venture, 235 F.3d 219, 223-24 (5th Cir. 2000).
Florer argues that this case should be analyzed as a discriminatory replacement case or, alternatively, as a discriminatory reduction in force. The Court agrees and concludes that Florer has presented evidence sufficient to establish a prima facie case under both lines of analysis. Under the discriminatory replacement issue, the Court concludes that Florer has presented evidence sufficient to demonstrate that a genuine issue of material fact exists as to whether Kevin Ponder ("Ponder") and Scott Timm ("Timm") replaced him upon his discharge.
Florer argues that if Ponder and Timm did not replace him, then a discriminatory reduction in force occurred. Because a plaintiff cannot demonstrate actual replacement in true reduction in force cases, the Fifth Circuit has modified the fourth element of a prima facie case for such cases. See Amburgey v. Corhart Refractories Corp., 936 F.2d 805, 812 (5th Cir. 1991).
In a reduction in force case — where plaintiff is not replaced — plaintiff's prima facie case may be met one of two ways. The first is to show that a younger, less qualified individual is retained while plaintiff is discharged. Vaughn v. Edel, 918 F.2d 517, 521 (5th Cir. 1990). The second is to show that plaintiff is discharged when qualified to assume another position but is not considered for the other position as a result of discrimination. See Amburgey, 936 F.2d at 812; EEOC v. La. Off. of Commty. Servs., 47 F.3d 1438, 1444 (5th Cir. 1995) (finding an inference of age discrimination where a younger, less qualified person assumes a position for which plaintiff is clearly more qualified). Demonstrating either of these situations creates an inference of discrimination sufficient to meet the final prong of plaintiff's prima facie case. See Bauer v. Albemarle Corp., 169 F.3d 962, 966 (5th Cir. 1999).
In the instant case, it is undisputed that Florer falls within the protected class, was qualified for the position he held at the time of discharge, and was actually discharged. EDS contends that Florer has not met the fourth element of a prima facie ADEA case because 1) his position, along with the entire Tier II communication sales team of which Florer was the head, was eliminated and not replaced; and 2) Ponder and Timm, two employees who assumed some of Florer's accounts, were not similarly situated to Florer, making an inference of age discrimination improper. (Def.'s App. at 384.) Florer argues that Ponder joined the Tier II sales team prior to Florer's discharge and assumed responsibilities similar to those held by Florer prior to his discharge. Florer further argues that, by assuming Florer's accounts and attempting to sell products or provide services to those accounts, Ponder and Timm effectively replaced Florer. (Def.'s App. at 55-57; Pl.'s App. at 9.)
EDS claims that Florer must provide evidence that Florer was in a "nearly identical" situation to Ponder and Timm. However, the Court's review of the relevant authorities indicates that such a showing is only required where plaintiff raises a disparate treatment claim. In replacement or reduction in force ADEA cases, this is not required for plaintiff's prima facie case. See Wyvill v. United Companies Life Ins. Co., 212 F.3d 296, 304 (5th Cir. 2000).
Defendant's Objection to Ponder's Declaration as undisclosed and in bad faith is OVERRULED. Plaintiff's Objections to Duckels' Deposition regarding Ponder's termination are also OVERRULED.
In sum, a " prima facie case is fairly easily made out." Amburgey, 936 F.2d at 812; Nichols v. Loral Vought Sys. Corp., 81 F.3d 38, 41 (5th Cir. 1996) (citing Thornbrough v. Columbus Greenville R.R. Co., 760 F.2d 633, 639 (5th Cir. 1985)). The Court, considering the evidence submitted, concludes that genuine issues of material fact exist concerning Florer's prima facie case, thereby precluding summary judgment.
B. Legitimate, Non-Discriminatory Reason
If the plaintiff establishes a prima facie case, the burden of production shifts to the defendant to articulate a "legitimate, non-discriminatory reason for its employment decision." Tyler v. Union Oil Co. of California, 304 F.3d 379, 395 (5th Cir. 2002); Medina v. Ramsey Steel Co., 238 F.3d 674, 680 (5th Cir. 2001); Evans v. City of Houston, 246 F.3d 344, 350 (5th Cir. 2001). "An employer meets its burden of production in employment discrimination cases by proferring admissible evidence of an explanation that would be legally sufficient to justify a judgment for the employer." Bodenheimer v. PPG Indus., Inc., 5 F.3d 955, 957 (5th Cir. 1993) (citing Guthrie v. Tifco Indus., 941 F.2d 374, 376 (5th Cir. 1991)).
A reduction in force is a presumptively legitimate, non-discriminatory reason supporting discharge. EEOC v. Texas Instruments, Inc., 100 F.3d 1173, 1181 (5th Cir. 1996); Armendariz v. Pinkerton Tobacco Co., 58 F.3d 144, 150 (5th Cir. 1995). EDS claims Florer was discharged as part of a reduction in force of approximately 2,000 employees. (Def. App. at 381, 385, 486.) Therefore, EDS has sufficiently met its burden to articulate a legitimate, non-discriminatory reason for Florer's discharge.
C. Pretext
Once the defendant provides a legitimate, non-discriminatory reason for the discharge, the presumption created by the presentation of a prima facie case is overcome and drops out; the plaintiff must then demonstrate that the reason proferred by defendant is a pretext for age discrimination. See Evans, 246 F.3d at 350 ("If the defendant can articulate a reason that, if believed, would support a finding that the action was nondiscriminatory, the mandatory inference of discrimination created by the plaintiff's prima facie case drops out of the picture and the factfinder must decide the ultimate question: whether the plaintiff has proved intentional discrimination.") (internal quotations omitted) (citing St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 511-12 (1993)); Pribila v. Emerson Elec. Co., No. CIV.A.3-00-2742BE, 2002 WL 629528, at *11 (N.D. Tex. Apr. 16, 2002) (citing Rhodes v. Guiberson Oil Tools, 75 F.3d 989, 992 (5th Cir. 1996)). In proving the ultimate question, the plaintiff can rely on evidence that the employer's reasons were a pretext for unlawful age discrimination and the factfinder may consider evidence established in plaintiff's prima facie case and any inferences properly drawn therefrom. See Evans, 246 F.3d at 350.
In the instant case, Florer does not dispute that a reduction in force occurred or that he was discharged pursuant to the reduction in force. (Pl.'s App. at 33, 47.) Rather, Florer argues that EDS's proferred reason is a pretext for discrimination. Florer disputes that he was included on the list of those to be discharged and that the entire Tier II telecommunications sales team was eliminated pursuant to the reduction in force. (Pl.'s App. at 9-10, 72-73.) Although EDS's financial position suffered in 2002 because EDS failed to meet its financial projections and its stock fell significantly, the parties dispute whether the Tier II sales team was effectively eliminated. (Pl.'s App. at 9, 55, 70, 149-51; Def.'s App. at 454, 455, 486.) Florer also contends that EDS's business plans included selling billing software to the Tier II telecommunications market. (Pl.'s App. at 73.)
Florer further argues that he was replaced by a younger, less qualified and experienced employee. Florer claims that he is clearly better qualified than either Ponder or Timm. (E.g., Pl.'s App. at 1, 9, 36, 52; Pl.'s Br. at 13.) Florer raises a genuine issue of material fact regarding whether Florer or Ponder is more qualified for either the Tier II telecommunications sales position or the position assumed by Ponder upon Florer's discharge. Florer therefore presents evidence sufficient to create an inference of pretext for age discrimination. EEOC v. La. Off. of Commty. Servs., 47 F.3d 1438, 1444 (5th Cir. 1995); Nichols v. Lewis Grocer, 138 F.3d 568 (5th Cir. 1998).
Florer argues that EDS was unreasonable in discharging him and either replacing him with or retaining Ponder and Timm. Although EDS contends that it subjectively believed Ponder to be as or more qualified than Florer (Def.'s App. at 147-48), the factfinder may substitute its judgment when it believes the employer's non-discriminatory reason to be false. See La. Off. of Commty. Servs., 47 F.3d at 1448. In the instant case, Florer presents sufficient evidence to raise a genuine issue of material fact concerning whether EDS's reason is false and a pretext for age discrimination.
Although Florer cannot second-guess business decisions made by EDS, id. at 1448, Florer can dispute business decisions where such decisions are based upon impermissible purposes and are a pretext for discrimination. Id. Florer presents summary judgment evidence supporting his claim that EDS's reasons for discharging him were false or otherwise a pretext for discrimination. See Reeves, 530 U.S. at 147 (noting that, to overcome summary judgment, a plaintiff need not prove an age animus where a prima facie case is made and plaintiff sufficiently rejects employer's reason); Armendariz v. Pinkerton Tobacco Co., 58 F.3d 144, 149 (5th Cir. 1995), cert. denied, 516 U.S. 1047 (1996) (noting that plaintiff must provide summary judgment evidence showing either the legitimate reason proferred by the employer to be false or the presence of discrimination).
EDS stated the following reasons for discharging Florer as part of EDS's reduction in force, all of which are substantially disputed by Florer: 1) the depressed state of the Tier II telecommunications and communications markets (Def.'s App. at 379-80); 2) the absence of billable software to sell (Def.'s App. at 410, 415-16); 3) Florer's failure to meet his quota over the previous twenty-four to thirty-six months (Def.'s App. at 379-80); 4) Florer's low contract value in the sales pipeline (Def.'s App. at 379-80); 5) the decision to retain salespersons responsible for selling complex, multi-application solutions (Def.'s App. at 433, 459); and the decision to eliminate the entire Tier II telecommunications sales team. (Def.'s App. at 384.) Florer has offered summary judgment evidence which creates a genuine issue of material fact on all of these reasons. The Court therefore concludes that Florer has raised a genuine issue of material fact regarding the legitimacy of EDS's proferred reason, creating an inference of pretext, thereby precluding summary judgment.
Plaintiff's Objection to Avera's Declaration is OVERRULED.
IV. CONCLUSION
For the reasons stated above, Defendant's Motion for Summary Judgment is DENIED. To the extent not ruled on above, Plaintiff's Objections and Motion to Strike are DENIED, Defendant's Objections and Motion to Strike are DENIED, and Defendant's Motion for Leave to File Supplemental Appendix Instanter is DENIED as moot. The Court DENIES Defendant's Motion to Sanction Plaintiff.
SO ORDERED.