Opinion
No. 98 C 7328.
June 20, 2000.
MEMORANDUM OPINION AND ORDER
Erin Ahern was an account executive for Universal Underwriters' Automotive Specialty Market Division (ASM). As an account executive, Ahern sold property casualty (PC) and life insurance to Chicago businesses in the automotive aftermarket, involving retail and wholesale part distribution and retail mechanical and body repair. Universal fired Ahern on June 30, 1997, saying that her performance in the last year (from the second half of 1996 through the first half of 1997) had been poor. Ahern says ASM fired her because of her gender.
As a threshold issue, defendant says Ahern waited too long to sue. 42 U.S.C. § 2000e-5(f)(1) gives a plaintiff ninety days from the receipt of a right-to-sue letter to file a complaint. ASM says that on March 10, 1998, after speaking with an EEOC investigator, plaintiff knew she was going to receive a right-to-sue letter soon. But the letter, signed on March 13, 1998, did not show up, and Ahern did not follow up with the EEOC for several months. ASM says Ahem was therefore at fault for the delay in receipt and that this should not toll the ninety-day limitations period. See Yehudah v. Chicago Park District, 1999 WL 104717 at * 2 (N.D. Ill. 1999) (discussing "fault" approach to ninety-day limitations period). Ahern was not at fault. The records from the EEOC indicate that in March, 1998, the Post Office returned the letter to sender, with "moved, left no address" checked as the reason. Ahern had not moved, so the only reasonable inference would be that some error occurred in delivery. There is no evidence that Ahern failed to check her mail. See Bond v. American Medical Association, 764 F. Supp. 122, 125 (N.D. Ill. 1991) (failure to check mail factored in fault determination). Actual receipt of the letter occurred on August 20, 1998 and the filing of the complaint was timely.
On to the merits:
The dramatis personae includes the plaintiff, Erin Ahern; Jerry McAndrews, senior vice president of ASM; Doug Elder, the regional sales manager for ASM-Illinois; and a crew of account executives: Todd Gentile; Jed Pence; Greg Yows; Gentry MeClatchey; and Steve Willuweit. Ahern was the only female account executive in the office.
In her first year, 1994, Ahern was a "Top Gun." She exceeded her sales goals and received the President's Club award. The second half of 1996 did not go so well for Ahern she wrote six PC policies totaling $75,743, about 38% of her goal of $200,000. In 1997, Ahern was not meeting her sales goal again, she wrote only three PC policies. In addition to lagging sales figures, Ahern had a low closing ratio and a high loss ratio. That is, she was not closing on accounts she proposed, and for every dollar she did sell, Universal ended up with a claim of $1.42. But Ahern was not a Shelley Levine in an office full of Ricky Romas; the other account executives fell short of their respective marks too.
For the entire year 1996, Ahern reached 66.3% of her $400,000 goal in P C.
See David Mamet, Glengarry Glen Ross: A Play (reissue ed., Grove Press 1992).
The numbers are not the entire story. Effective January 1, 1997, McAndrews ordered a reallocation of sales territories based on standard industry classification (SIC) codes. These codes allowed ASM to define territories based on the number of businesses and the size of those businesses within a given geographical area. McAndrews told Elder to reassign the territories based on SIC codes, which he did. Before the reallocation, Ahern's territory had over 1800 leads. McAndrews and Elder's new system gave 850 of these Chicago leads to Willuweit. Ahern spent time bringing Willuweit up to speed on his new (her former) territory. In addition to losing customers with this reallocation and spending time training Willuweit, Ahern lost 80 "x" dates (referring to expiration dates of policies that are, not surprisingly, solid prospects for selling new policies). Ahern characterizes the reallocation as decimating to her customer base; McAndrews and Elder did not change Ahern's sales goal for 1997 to adjust for this loss.
Ahern disputes that a SIC code is a "lead." For now, the usefulness of SIC codes as leads is not material.
Early in 1997, a fire at Audio Systems, Inc. (also called Music in Motion) led to a million dollar-plus claim on a policy renewed by Ahern. McAndrews suspected that Audio Systems may not have been an appropriate fit for ASM when he learned (after the fire) that most of its business was in home, not car, stereos. McAndrews was also concerned by allegations that Ahern had not visited the premises before renewing the policy. In the course of dealing with the Audio Systems claim, McAndrews learned that Ahern made a clerical mistake in the policy that required ASM to increase the coverage limits on the claim.
While McAndrews's concern is based on out-of-court statements recorded by an insurance investigator, the allegations are not offered for the truth of the matter asserted, but to establish McAndrews's state of mind. Therefore, they are admissible.
Ahern knew she was not performing like a Top Gun; she testified that her performance between January and May of 1997 was not up to her own standards. In March, 1997, Ahern wrote up a new business plan for herself. In May, 1997, Doug Elder gave Ahern a special performance review which states, "Erin has not come close to meeting acceptable levels of performance. . . . I am of the opinion that Erin needs to decide if she has chosen the right career for her future." Elder says he gave her the review because she was not meeting her March business plan; he wanted to fire her immediately but was told by personnel that he had to give her a review to help her turn it around. The review told her that further disciplinary action, including termination, would result if immediate improvement in production did not occur. This was the first time Ahern received a negative performance review; she was put on probation and fired a month later. Elder replaced Ahern with Nick Beil.
ASM says it is entitled to summary judgment because Ahern cannot make a prima facie case of sex discrimination and even if she can, she cannot prove that ASM' s legitimate, non-discriminatory reasons were pretextual. Summary judgment is appropriate if, evaluating the admissible evidence in the light most favorable to the plaintiff there is no genuine issue of material fact and ASM is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255, 106 S.Ct. 2505, 2513 (1986).
This case does not stake out any novel legal issues. It is governed by the familiar McDonnell Douglas approach to indirect proof of employment discrimination. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817 (1993). The legal test for discrimination involves a lawyer's favorite — the multi-pronged test. Ahern must present evidence that: (1) she is a member of a protected class; (2) she was meeting ASM's legitimate performance expectations; (3) she suffered an adverse employment action; and (4) ASM treated similarly situated persons outside the protected class more favorably. Vakharia v. Swedish Covenant Hospital, 190 F.3d 799, 806 (7th Cir. 1999). This creates a presumption of discrimination. ASM may rebut this presumption by producing evidence of a legitimate nondiscriminatory reason for its decision. The burden shifts back to Ahern to produce evidence that casts doubt on the credibility of ASM's proffered reasons. Mills v. Health Care Service Corp., 171 F.3d 450, 454 (7th Cir. 1999). The burden of persuasion ultimately rests with the plaintiff to prove intentional discrimination by the defendant. See Reeves v. Sanderson Plumbing Products, Inc., — S.Ct. —, 2000 WL 743663 at * 13 (2000).
ASM does not dispute Ahern's ability to prove the first and third prongs of the prima facie case. And rightly so; Ahern is a member of a protected class and suffered an adverse employment action. ASM does, however, contend that Ahern was not meeting legitimate performance expectations (second prong) and that there were no similarly situated male employees treated more favorably (fourth prong).
Once a defendant asserts a nondiscriminatory reason for its actions, the presumption of the prima facie case fades away and the ultimate issue becomes plaintiffs ability to demonstrate pretext. E.E.O.C v. Our Lady of the Resurrection Medical Center, 77 F.3d 145, 150 (7th Cir. 1996). Notwithstanding defendant's objections to plaintiff's prima facie case, it is permissible, indeed often more logical, to decide the summary judgment motion on the ultimate issue. Id., 77 F.3d at 149. In this case, defendant says Ahern was not meeting performance expectations and that no one else in the office was performing as poorly as she was. When a defendant's proffered reasons for termination coincide with the prima facie case, it is sensible to determine simply whether these reasons were honestly believed or not. If ASM could not credibly believe that Ahern was performing so poorly relative to the others to warrant termination, then Ahern has a triable case. See Roberts v. Separators, Inc., 172 F.3d 448, 451 (7th Cir. 1999) (pretext analysis often dovetails with prima facie case).
Ahern has not produced sufficient evidence to refute each of ASM's reasons for her termination. See Mills, 171 F.3d at 459 (7th Cir. 1999). First, the numbers demonstrate that she was significantly below sales goals. The data from the second half of 1996 and the first half of 1997 are the appropriate figures to examine. According to her deposition testimony, Ahern' s anniversary date was in June, therefore her annual review cycle should cover June 1996 through June 1997, the time period proffered by defendant. Only Ahern, Gentile and Pence were account executives throughout the second half of 1996. Ahern's sales percentages during this period were lower than both Gentile's and Pence's. For the first half of 1997, Ahern's sales in PC put her at the bottom of the office. In both PC and life, Ahern's sales figures were superior only to McClatchey, who was fired shortly after Ahern.
The reallocation of territory changed Ahern's customer base, but there is no evidence to dispute McAndrews's business case for the use of SIC codes. Ahern says that SIC codes are not necessarily good leads; in Chicago, they do not account for areas of known risk. This may be true, but it does not suggest that McAndrews was dishonest in his belief that SIC codes were appropriate for the entire Midwest region. In addition, this reallocation affected one male employee, Greg Yows. His territory was reduced from 1200 SIC leads to 625. Therefore, there is no evidence that the reallocation itself was discriminatory. Ahern also notes that her sales goal was not adjusted with the reallocation, so judging her performance as a percentage of her goals is misleading. Even if her goals were unreasonably high, the fact remains that Ahern sold only three PC policies in 1997. Ahern testified that this was unacceptable to her.
In addition to sales figures, ASM points to Ahern's closing and loss ratios as indicative of subpar performance. There is no dispute that Ahern's loss ratio of 142.2 was the highest in the office, and the only one over 100. The next highest loss ratio is Willuweit's. He took over some of Ahern's territory after the reallocation. Perhaps the Chicago area is riskier than other regions and this explains Ahern's and Willuweit's loss ratios. Regardless, the fact that an account executive is losing money is a legitimate performance indicator.
Ahern agrees that she was performing poorly but argues that performance cannot be the reason for her termination since other poor performers were given opportunities to "turn it around." The problem for Ahern is that the other account executives were not similarly situated to her in all respects. See Spath v. Hayes Wheels International-Indiana, Inc., 211 F.3d 392, 397 (7th Cir. 2000). As of June, 1997 there were three men with sales figures arguably worse than Ahern's. McClatchey had dismal sales figures, but he was fired too; his case does not advance plaintiff's theory. Justin Thomas started working for ASM in March, 1997; it is not helpful to compare his numbers to Ahern's. Yows had a lower percentage in life insurance sales than Ahern, but his PC numbers were higher. Unlike most of the others in the office, Yows had a loss ratio within the company's standards. Therefore, according to these indicators, Yows was not performing worse than Ahern; he is not similarly situated to her.
Gentile's and Pence's numbers were better than Ahern's, but they were far below their goals. Gentile had about the same level of experience as Ahern, and made only 40% of his PC goal as of June, 1997. However, Gentile did well in life insurance. Most importantly, Gentile was more profitable. His loss ratio was high, but not as high as Ahern's, and not over 100. Similarly, Pence was doing well in life insurance and was more profitable than both Gentile and Ahern.
Elder testified that both Gentile and Pence were underperforming. Instead of firing them, Elder gave them a chance. Elder spent a week with Pence and became convinced that Pence had a good rapport with his customers. Elder thought Gentile was head and shoulders above Ahern despite his poor performance. Again, Elder cited Gentile's better profitability and good customer relations. By June, 1997, Elder believed Ahern was too far gone to salvage. Unlike with Pence, Elder did not ride along with Ahern to advise her on customer calls, even though she asked for his help. Eventually in late 1997, Elder realized Pence was not going to improve, so he sat Pence down for a talk; a month later, Pence quit.
The Gentile and Pence examples do not cast sufficient doubt on ASM's reasons for terminating Ahern. No one in the office was performing particularly well, but Ahern was the only one with a loss ratio over 100. Elder kept the account executives that were performing better than Ahern and fired the one who was performing worse. Beyond the numbers, Ahern does not dispute the evidence concerning the Audio Systems fire. McAndrews believed Ahern had not inspected the property before renewing it. This is a legitimate, nondiscriminatory concern about Ahern's diligence. Plaintiff testified that she probably inspected the premises; but a reason for termination need not be true, it must simply be honestly believed. Here, McAndrews heard that Ahern did not inspect the building and learned that she made a clerical error in the policy. There is no evidence that this incident was not honestly believed to be a black mark on Ahern's record.
ASM also argues that a perfume shop owned by Ahern and managed by her sister took up her time and distracted her from insurance sales. There is no direct evidence of this and, on summary judgment, 1 reject defendant's inference.
Elder did not hire any women for account executive positions. He granted interviews to over one hundred applicants, but only ten or so were women. He said the female applicants were not as qualified as the male ones. This is not the kind of statistically rigorous circumstantial evidence sufficient to prove pretext. That Elder did not interview many women does not suggest he lied when he fired Ahern for poor performance. Elder fired two people in the summer of 1997, one woman, Ahern, and one man, McClatchey. Elder's arguably suspicious hiring practices do not refute his assessment of Ahern's performance, and they do not alter McAndrews's beliefs concerning the Audio Systems fire.
Ahern has not produced evidence suggesting that her performance was an illegitimate ground for termination. Therefore, she has not produced evidence suggesting pretext. Defendant's motion for summary judgment [18-1] is granted.