Opinion
20-P-159
05-06-2021
Justin NEALIS v. MOLECULAR HEALTH, INC.
MEMORANDUM AND ORDER PURSUANT TO RULE 23.0
In this employment discrimination and retaliation action, the plaintiff, Justin Nealis, brought a claim against his former employer, the defendant, Molecular Health, Inc. (Molecular), alleging that Molecular had discriminated against him on the basis of his sexual orientation and then retaliated against him after he filed an internal complaint alleging discrimination. A judge of the Superior Court granted Molecular's motion for summary judgment, and Nealis now appeals. For the reasons discussed below, we affirm the judgment of the Superior Court.
Background. We draw the facts from the summary judgment record, viewing the evidence in the light most favorable to Nealis and drawing all reasonable inferences in his favor. See Bulwer v. Mount Auburn Hosp., 473 Mass. 672, 680 (2016). Molecular is a wholly owned subsidiary of Molecular Health GmbH, headquartered in Germany (parent company). In November 2016, Molecular hired Nealis, who is a gay man, as an information technology (IT) manager. Nealis reported to Gerry Sheridan, Molecular's chief financial officer. At the time Nealis was hired, Molecular had two offices in the United States, one in Boston, Massachusetts, and one in Woodlands, Texas, and employed approximately one hundred people. In December 2016, Molecular closed its Texas office and laid off approximately fifty to one hundred employees. About twenty people, including Nealis, remained employed by Molecular, working either remotely or from the Boston office. In April 2017, Molecular hired Shahir Salyani as vice president of business development.
As IT manager, Nealis was responsible for, among other duties, distributing and supporting company-owned electronic equipment to employees, solving technical issues for user groups, and training personnel. Shortly after Salyani was hired, he and Nealis had a dispute regarding Salayani's company-issued laptop and cell phone; Nealis refused to issue Salyani his assigned devices because he claimed he had not received the appropriate paperwork. Nealis eventually gave Salyani his assigned laptop, but only gave Salyani his assigned cell phone after Sheridan instructed Nealis to do so. This dispute was the first of many between Nealis and Salyani.
In a separate incident on May 16, 2017, Nealis e-mailed Llara Nelson, a human resources (HR) generalist, to report that Salyani had "circumvented United States IT policy" by storing data on his local laptop, which was not encrypted, and also by not storing copies of his data on the company server. Nealis also stated that Salyani "disparage[d] me to colleagues by CCing leadership on almost every e-mail he sends me, including for basic support issues. I'm unsure if this is intentional or not, but regardless of intent, it's making me look bad to leadership domestic and abroad...." Sheridan met with Nealis and Salyani about Nealis's complaint in an effort to mediate the dispute. Nealis later testified that, during the meeting, Salyani "explained that he felt he was under extreme pressure and duress to provide work for the company;" Nealis agreed that he would try to do better, but "that I also needed him to try and listen to what I have to say about IT things and I said I would respect his expertise if he could try and respect mine."
Thereafter, Nealis continued to raise complaints about Salyani, including Salyani's plans to bring his company-issued cell phone on a personal trip to Cuba in June 2017; Salyani's decision to advise the Boston office manager, Matthew Goldberg, and not Nealis, that Salyani had accidentally left his company-issued laptop at a Transportation Security Administration checkpoint in the Philadelphia airport in July 2017; Salyani's request that the recovered laptop be shipped to his home in Philadelphia, rather than to the Boston office in July 2017; Salyani's failure to enroll his company-issued cell phone in the Apple Device Enrollment Program in July and again in September 2017; and Salyani's "bullying" two other employees into handling his ongoing IT issues in September 2017 in order to avoid working directly with Nealis.
On September 29, 2017, Nealis e-mailed Sheridan and stated that some employees had overheard a rumor that Molecular only had sufficient funding to last through January 2018. In October 2017, in fact, Molecular laid off around thirteen to fifteen employees. This layoff left five employees, including Nealis, physically working in the Boston office, while five others worked remotely. The general understanding among the remaining employees was that these October 2017 layoffs were financially motivated and that Molecular was not doing well from a business perspective.
On October 23, 2017, Nealis e-mailed Sheridan and Nelson to request a severance package from Molecular; the package included, among other things, a "monthly retention payment" in addition to Nealis's salary, along with severance payments upon the occurrence of certain events. Nealis stated in his deposition testimony that he had requested the package because he did not believe Sheridan's assurances that Molecular was doing well, in light of the fact that the company had "been doing nothing but layoffs since [he] started." On November 16, 2017, Sheridan informed Nealis that Nealis's severance package request had been rejected.
In January 2018, Nealis and Marcus Düsi, the vice president of IT for Molecular's parent company in Germany, met in the Boston office to discuss whether any further IT support would be needed in the United States, given the small number of remaining employees. During that meeting, Düsi asked Nealis for all information concerning how the Boston office operated from an IT perspective, as well as for the master password for the system. Nealis testified that, due to their discussion, he "did have some concerns that [he] would be terminated, but [he] was not necessarily worried that [he] would be." On January 23, 2018, Düsi sent an e-mail with the subject "Summary Boston IT," in which he assigned Nealis a list of tasks, including liquidating some of Molecular's hardware; he also indicated that he would track the status of the projects on a weekly call with Nealis.
On January 25, 2018, Anthony Caruso, the senior vice president of client services, e-mailed Nealis, complaining that his WebEx account, the platform through which Molecular interacted with customers, had been deactivated without notice. Nealis informed Caruso that "Germany made it clear [the accounts] needed to be cancelled immediately, and [he] had no choice but to comply with that request." On the same day, Nealis e-mailed Thorston Vogt, the parent company's HR representative in Germany, concerning the "low morale of the Boston offices," referencing his July 8 and September 21 complaints about Salyani, and stating that Salyani's conduct towards him "could be considered a pattern of discrimination, given that I am openly gay." In that same e-mail, Nealis stated that he and his other coworkers "fear for our jobs every single day." This e-mail was the first time Nealis had complained that Salyani or anyone else at Molecular had discriminated against him on the basis of his sexual orientation. Vogt responded to Nealis's e-mail the next day, January 26, 2018, stating: "We take our employees[’] feedback and complaints serious[ly] and do not accept any incorrect treatment. We will initiate a thorough investigation without undue delay. I already informed Michael Ghaffar in his capacity as General Counsel and we will revert to you shortly." Attorney Tracey E. Diamond subsequently began an investigation of Nealis's complaint that Salyani had discriminated against him because of his sexual orientation.
By February 6, 2018, Sheridan had been laid off, effective April 30, 2018, and the only employees remaining in the Boston office were Nealis, Salyani, Goldberg, and Yash Sinha, Molecular's finance director. Two of the employees who remained, Nealis and Goldberg, are gay. That day, Friedrich von Bohlen, chief executive officer of Molecular's parent company, e-mailed all Molecular employees and informed them that, due to Sheridan's departure, Salyani would be "disciplinarily/administratively responsible for all Molecular Health US-based employees," and that Nealis would have "dotted-line reporting to Marcus Düsi."
On February 9, 2018, Salyani e-mailed various individuals in the Germany office in connection with the upcoming "process of evaluating all employees worldwide for 2017 performance against personal and corporate objectives," and requested that Nealis's evaluation be conducted by Düsi or Rudy Caspary, the chief information officer of Molecular's parent company, because they were the "functional leaders of the area that [Nealis] work[ed] within."
Also on February 9, 2018, Ghaffar sent an e-mail to Nealis stating that Diamond had completed her investigation, and that she had "concluded that there was no evidence that anyone at Molecular Health has discriminated against [Nealis] based on [his] sexual orientation or any other protected category." That conclusion was based, at least in part, on interviews Diamond had conducted with Nealis, Sinha, Goldberg, Sheridan, Salyani, and Caruso.
On February 12, 2018, Salyani e-mailed the five remaining United States employees, requesting that they send him their 2017 performance evaluations. Nealis sent his evaluation to Salyani that same day.
On February 14, 2018, Nealis was informed that his employment would be terminated, effective February 15, 2018. That same day, Ghaffar sent a follow-up e-mail to Nealis wherein Molecular offered Nealis two options for the terms of his termination: (1) an early termination and a severance payment in line with existing policy equaling one-half month's salary per year of employment; or (2) a formal prolongation of Nealis's employment of two weeks per year of employment with a nominal severance payment at the end. Nealis chose the first option.
Molecular's downsizing continued after Nealis's departure. By April 5, 2019, Molecular had shuttered its Boston office. Its three remaining employees worked remotely, and none were employed as IT personnel.
In the second quarter of 2018, Goldberg was laid off from Molecular and was not replaced. In the second half of 2018, Sinha resigned. Salyani stated in his deposition testimony that Sinha was replaced, "in a sense," by Michael Schell. Ghaffar stated in his deposition testimony that Schell was now "heading with payroll," working part-time and remotely. Salyani was later laid off in early 2019 and was not replaced.
Discussion. 1. Standard of review. This court reviews a grant of summary judgment de novo. Galenski v. Erving, 471 Mass. 305, 307 (2015) ; Bulwer, 473 Mass. at 680. "A motion for summary judgment under Mass. R. Civ. P. 56 (c), as amended, 436 Mass. 1404 (2002), is appropriate where the moving party ... show[s] that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law based on the undisputed facts" (quotations omitted). Bulwer, 473 Mass. at 680, quoting Premier Capital, LLC v. KMZ, Inc., 464 Mass. 467, 474 (2013).
2. Sexual orientation discrimination claim. General Laws c. 151B, § 4 (1), provides that "[i]t shall be an unlawful practice ... [f]or an employer ... because of the ... sexual orientation ... of any individual ... to discharge from employment such individual or to discriminate against such individual in compensation or in terms, conditions or privileges of employment." To prevail at trial, an employee bringing a claim under G. L. c. 151B, § 4 must demonstrate (1) that he is a member of a protected class; (2) that he was subject to an adverse employment action; (3) that the employer bore "discriminatory animus" in taking that action; and (4) that the animus was the reason for the action (causation). Bulwer, 473 Mass. at 680, citing Lipchitz v. Raytheon Co., 434 Mass. 493, 502 (2001).
Where, as is common in employment discrimination cases, a plaintiff cannot produce direct evidence of the latter two elements above, discriminatory animus and causation, we turn to the three-stage McDonnell Douglas burden-shifting analysis. See McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802–805 (1973) ; Verdrager v. Mintz, Levin, Cohn, Ferris, Glovsky & Popeo, P.C., 474 Mass. 382, 396-397 (2016).
First, the plaintiff must establish, by a preponderance of the evidence, a prima facie case of discrimination. Sullivan v. Liberty Mut. Ins. Co., 444 Mass. 34, 40 (2005) ; Scarlett v. Boston, 93 Mass. App. Ct. 593, 597 (2018). To meet his burden, the plaintiff must produce evidence that would allow a jury to infer that (1) he is a member of a class protected by G. L. c. 151B; (2) he performed his job at an acceptable level; (3) he was terminated or otherwise subject to an adverse employment action, and (4) in a reduction in force case like this one, that his "layoff occurred in circumstances that would raise a reasonable inference of unlawful discrimination." Sullivan, supra at 41, 45. "[T]he plaintiff's initial burden of establishing a prima facie case is not intended to be onerous." Id. at 45. "[A] plaintiff who ‘was truly singled out for discharge’ because of membership in a protected class ‘should be able to develop enough evidence through the discovery process or otherwise to establish a prima facie case.’ " Id., quoting Barnes v. GenCorp., Inc., 896 F.2d 1457, 1465–1466 (6th Cir. 1990), cert. denied, 498 U.S. 878 (1990).
Next, "the burden of production shifts to the employer to articulate a legitimate, nondiscriminatory reason for its hiring decision" (quotation and citation omitted). Verdrager, 474 Mass. at 397. If the employer meets this burden, then "the burden of production shifts back to the employee to produce evidence that the employer's articulated justification [for the adverse action] is not true but a pretext" (quotation and citation omitted). Id. In this final stage, "the plaintiff need only present evidence from which a reasonable jury could infer that ‘the respondent's facially proper reasons given for its action against him were not the real reasons for that action.’ " Bulwer, 473 Mass. at 682, quoting Wheelock College v. Massachusetts Comm'n Against Discrimination, 371 Mass. 130, 139 (1976). If the plaintiff does present such evidence, the case may proceed to trial, where "if the fact finder is persuaded that one or more of the employer's reasons is false, it may (but need not) infer that the employer is covering up a discriminatory intent, motive or state of mind." Bulwer, supra, quoting Lipchitz, 434 Mass. at 501.
Here, Nealis has produced evidence sufficient to establish, at the summary judgment stage, the first, second, and third elements of his prima facie case for discrimination: (1) Nealis is a gay man who claims that his sexual orientation was the basis of his firing; (2) the evidence, viewed in its most favorable aspects to Nealis, does not support a finding that his job performance was substandard at Molecular; and (3) his employment was terminated.
Nealis did not satisfy the fourth element, however. Having had the benefit of discovery, Nealis did not produce sufficient evidence to raise an inference of unlawful discrimination. First, we agree with the judge that Nealis failed to raise a triable issue of fact that Salyani knew Nealis's sexual orientation during the period Nealis alleges he was discriminated against. Salyani testified in his deposition that he first learned of Nealis's sexual orientation when he was informed that Nealis had lodged a discrimination complaint against him and that an investigation was forthcoming. To counter this testimony, Nealis offered evidence that he was "openly gay" at Molecular in that he "did not hide" his sexual orientation, which was "well-known" within the company. He also offered evidence that many Molecular employees learned that Nealis was gay during company "roundtable" discussions, which Nealis described as "casual social meetings." However, it is undisputed that Salyani did not attend these roundtable discussions, and otherwise spent approximately forty percent of his working time in the Boston office. And Nealis admitted, "I can't speak to the remote workers. I can't speak to [whether] Mr. Salyani [knew I was gay]."
To support this fourth element, Nealis emphasizes that Salyani knew of Nealis's sexual orientation by the time Nealis was fired; Salyani could have had a role in Nealis's termination; the date the decision was made to terminate him is in dispute; and Molecular refused to produce certain documents concerning its financial status in 2017 and 2018. These factors do not give rise to a reasonable inference of unlawful discrimination. Even if we assume that Salyani did have a role in Nealis's termination and that the date the decision was made to terminate Nealis was shortly before his firing, that would not suffice to create a genuine issue for trial. The undisputed facts on the record show that Molecular was undergoing significant layoffs; that employees, including Nealis, understood that those layoffs were the result of Molecular's poor financial situation; and that Nealis was not replaced after his termination by a functionally equivalent employee. Indeed, we note that, by the time Nealis was terminated, only five employees, including Nealis, remained in the United States, rendering Nealis's services as a full-time IT manager unnecessary for Molecular's ailing Boston operation. A review of the evidence simply does not support a finding that Nealis's termination "occurred in circumstances that raise a reasonable inference of unlawful discrimination." Sullivan, 444 Mass. at 45. Accordingly, Nealis has not presented sufficient evidence to create a triable issue on each element of his prima facie case.
Finally, and as the trial judge noted, even if Nealis were able to meet his burden in the first stage of the burden shifting analysis, his case would founder at the third stage for failure to show pretext, as discussed infra.
3. Retaliation claim. "To survive summary judgment on a claim of retaliation, an employee must produce evidence from which a jury could infer ... [1] that the employee reasonably and in good faith believed that the employer was engaged in wrongful discrimination[;] ... [2] that the employee acted reasonably in response to that belief, ... through reasonable acts meant to protest or oppose ... discrimination (protected activity)[;] ... [3] that the employer took adverse action against the employee[;] ... [and 4] that the adverse action was a response to the employee's protected activity (forbidden motive)" (quotations omitted). Verdrager, 474 Mass. at 405–406.
Employees bringing a claim of retaliation may prove the fourth element, forbidden motive, "with indirect evidence, which courts evaluate using a three-stage burden-shifting paradigm similar to the one discussed in McDonnell Douglas, supra." Verdrager, 474 Mass. at 406. This burden-shifting analysis for a claim of retaliation is similar to that discussed above for a claim of discrimination. First, the employee must produce evidence "that he engaged in protected conduct, that he suffered some adverse action, and that a causal connection existed between the protected conduct and the adverse action" (quotation and citation omitted). Mole v. University of Mass., 442 Mass. 582, 591–592 (2004). Where, as here, the first two elements are undisputed, this first stage can in some circumstances be satisfied by a showing of close temporal proximity between the employee's protected activity and the employer's adverse employment action. Id. at 592–593. At the second stage, "the ‘employer must then articulate a legitimate, nondiscriminatory reason’ for the adverse employment decision." Verdrager, supra, quoting Esler v. Sylvia-Reardon, 473 Mass. 775, 780 n.7 (2016). Finally, if the employer meets its burden, then "the employee must produce evidence that the employer's stated reason for [its adverse action] was a pretext for retaliating against [the employee] on account of [the employee's] protected activity" (quotation and citation omitted). Verdrager, supra.
Here, the parties dispute the date that the decision was made to terminate Nealis's employment at Molecular, the reasons the decision was made, and the individuals involved in the decision. Ghaffar stated in his deposition testimony that, while he could not say the exact date the decision was made to terminate Nealis's employment, it was "many months before" Nealis was informed of his termination on February 14, 2018. When asked if he could "ballpark" the date the decision was made, Ghaffar answered, "No, it was implementing the downsizing of operations following – driven by economic realities." Ghaffar also stated that the decision to terminate Nealis's employment was not due to Nealis's job performance. Ghaffar testified that "the management team" made the decision to terminate Nealis's employment, and that those individuals involved in the decision were "Friedrich [von Bohlen], Thorston Vogt, ... [Torsten Buergesmeister], and [Gerry Sheridan]." Ghaffar also testified that Düsi was not involved in the decision to terminate Nealis's employment. Salyani stated in his deposition testimony that he had nothing to do with the decision to terminate Nealis, but Nealis disputes this fact. Ghaffar, when asked whether the outcome of the investigation into Nealis's discrimination complaint had any bearing on the date Nealis was to be terminated, stated that Nealis "most likely" would not have been terminated on February 15, 2018, "because then we would have started ... discussions as to how we resolve this [discrimination] issue. Still it would have not changed anything with respect to ... the economic situation that it didn't make sense to have an IT manager for a non[-] existing operation."
Like the trial judge, we assume without deciding that Nealis satisfied his initial burden. He engaged in protected conduct when he filed his discrimination complaint, suffered an adverse action when he was terminated, and potentially could establish a causal connection, by inference, between his complaint and termination because he was terminated twenty-one days after he filed his complaint. In turn, Molecular successfully articulated a legitimate, nondiscriminatory reason for its decision to terminate Nealis's employment, a point not disputed by Nealis.
Arriving at the final stage of the burden-shifting analysis, we conclude that Nealis failed to create a triable issue on the issue of pretext. To support his claim that Molecular's proffered reason for his termination is pretextual, Nealis first emphasizes the close temporal proximity between the date he made his complaint and the date on which he was terminated. Nealis argues that, when combined with evidence of Molecular's unlawful animus towards his discrimination complaint, this close temporal proximity is strongly suggestive of retaliation. See Verdrager, 474 Mass. at 409–410. To support his assertion of animus, Nealis points to Molecular's May 15, 2018 position statement to the Massachusetts Commission Against Discrimination (MCAD), made in response to an MCAD charge filed by Nealis, where Molecular called Nealis's internal discrimination complaint "a last ditch effort to avoid the elimination of his job" and stated that the complaint was not made "in good faith." The language used in that position statement, however, amounts to a legal defense in response to allegations of illegal conduct and cannot seriously be considered evidence of past animus required to establish pretext.
Next, Nealis emphasizes inconsistencies from Molecular as to why he was terminated, who made the termination decision, and whether Nealis was terminated earlier than he otherwise would have been but for his discrimination complaint. Nealis points out that Molecular initially raised complaints about his job performance in its MCAD position statement only to state later that job performance was not a factor in his termination. However, whatever issues Molecular had with Nealis's job performance, it was consistent in its explanations for the termination (i.e. a reduction in force and the lack of need for the services of an IT manager in a five-person operation). Nealis also alleges that Molecular was inconsistent when naming the individuals involved in the decision to terminate his employment. We conclude that the interrogatory responses and Ghaffar's deposition testimony are not necessarily inconsistent, and that, even if they are, the inconsistencies are not material ones that amount to "evidence from which a reasonable jury could infer that ‘the respondent's facially proper reasons given for its action against [the plaintiff] were not the real reasons for that action’ " (citation omitted). Bulwer, 473 Mass. at 682.
Nealis's interrogatory requested that Molecular "[i]dentify all individuals you believe possess firsthand information regarding any of the facts alleged by [the plaintiff] in the Complaint or by [Molecular] in its Answer or defenses...." Molecular's response named Sheridan, Salyani, Caruso, and Düsi. Ghaffar, when asked during his deposition which individuals were involved in the decision to separate Nealis from his employment, answered "Friedrich [von Bohlen], Thorston Vogt ... [Torsten Buergermeister], and [Gerry Sheridan]."
Finally, Nealis claims that his termination occurred earlier than it otherwise would have because of his discrimination complaint. To support this claim, Nealis points to, among other things, multiple perceived inconsistencies between the date of his termination and his ongoing duties at Molecular. However, we conclude that the factual disputes Nealis raised are not material. Rather, as the judge found and we agree, the evidence shows that Molecular took no action to implement Nealis's layoff while outside counsel was investigating the complaint, but it does not give rise to a reasonable inference that Molecular accelerated the layoff because of the complaint. Having carefully reviewed each of the identified factual disputes, we are satisfied that Nealis has not presented sufficient evidence giving rise to an inference that his termination would have occurred at a later time but for his discrimination complaint.
In sum, evidence traditionally used to show pretext is simply not present in this record, and Nealis has failed to create a genuinely disputed issue in this final stage of the analysis. See Verdrager, 474 Mass. at 398–402 ; Bulwer, 473 Mass. at 682–688 ; Abramian v. President & Fellows of Harvard College, 432 Mass. 107, 114–115 (2000).
We have considered Nealis's remaining arguments but find nothing requiring discussion. Commonwealth v. Domanski, 332 Mass. 66, 78 (1954).
Conclusion. For the reasons set forth in this decision, the judgment in favor of Molecular is affirmed. Molecular's request for fees is denied.
So ordered.
Affirmed.