IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 96-11130
WILLIAM B. PILCHER,
Plaintiff-Appellant,
versus
CONTINENTAL ELECTRONICS CORP.,
Defendant-Appellee.
Appeal from the United States District Court
For the Northern District of Texas
(93-CV-1743)
July 8, 1997
Before HIGGINBOTHAM, WIENER, and DENNIS, Circuit Judges.
PER CURIAM:*
*
Pursuant to 5TH CIR. R. 47.5, the Court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
In this Age Discrimination in Employment Act1 (ADEA) case,
Plaintiff-Appellant William B. Pilcher (Pilcher) appeals the
district court’s grant of Defendant-Appellee Continental
Electronics Corporation’s (CEC) motion for summary judgment,
concluding that Pilcher had failed to establish a claim under the
ADEA. In our de novo review we find that issues of material fact
exist as to (1) whether Pilcher bore his burden of presenting a
prima facie case of age discrimination, and (2) if so, whether
CEC’s proffered reason for his discharge —— one of a number of
employment actions taken as part of a RIF —— was merely a pretext
for a discriminatory replacement situation. Accordingly, we
reverse.
I
FACTS AND PROCEEDINGS
Pilcher graduated in 1960 from Texas Technological University
with a B.S. in electrical engineering. After receiving his degree,
Pilcher went to work for CEC as a Staff Engineer and Valve Engineer
Coordinator. CEC manufactures radio transmitters and other
products and performs contract work related to the United States
government and the defense industry. In 1969, Pilcher received an
M.B.A. from North Texas State University while working for CEC.
In 1970 Pilcher left CEC and thereafter worked in a number of
different jobs, most notably as Contracts Manager for UTL
1
29 U.S.C. § 621 et seq.
2
Corporation (UTL) from 1977 through 1987. UTL’s business was 85
percent government contracts and 15 percent domestic and
international commercial contracts. Pilcher negotiated contracts,
supervised contract administration, and assisted in contract
proposals.
In 1987 Pilcher returned to CEC to become Manager of Contract
Administration. Over time he assumed additional responsibilities,
and in 1991 he was promoted to Manager of Contracts and Proposals,
in CEC’s Finance Department. Pilcher’s yearly performance reviews
encouraged him to identify and train a successor, which he assumed
would clear the way for him to be promoted.
Meanwhile, in 1990, Lonnie Roberts had joined CEC as Vice-
President of Finance. In September 1991, CEC hired John Newell,
age 42, for the position of Government Contracts Administrator.
Newell had graduated cum laude from the College of St. Thomas and
had received a law degree from the University of Iowa College of
Law.
At about the same time that Newell was hired, Pilcher was
promoted to Manager of Contracts and Proposals, which entailed
increased responsibility, including serving as Newell’s supervisor.
In November 1991, just two months after Newell’s arrival, CEC
informally changed his title to Department Head, Contracts
Administration; and in January 1992, Newell was formally promoted
to that position.
3
On January 17, 1992, CEC terminated Pilcher, age 61,
purportedly as part of a RIF, which CEC asserts was necessitated by
a substantial reduction in its government contracts business. CEC
explains that, based on Lonnie Roberts’ suggestion, it had decided
to reduce its managerial staff and to implement a concomitant
consolidation of managerial responsibilities into the duties of the
managers who remained. In fact, Pilcher was one of 37 CEC
employees who were fired on the same day. Of those 37 employees,
seven whose average age was fifty years were from Pilcher’s
department; however, Newell was never considered for termination.
Two other older employees, both women, were terminated during the
alleged RIF. Like Pilcher, those women are alleged to have been
required to train their younger successors before they were fired.2
Pilcher insists that when he was laid off he was informed by
both Newell and Lonnie Roberts that Newell would be taking
Pilcher’s place. Indeed, Newell did assume Pilcher’s government
contracts responsibilities and began supervising the remaining
employees whom Pilcher had been supervising. Newell also assumed
Pilcher’s other responsibilities — Spares as well as Pricing and
Proposals. Sometime later, other employees assumed some of
Pilcher’s previous duties, as his position was ultimately
2
Jan Krummrich, age 54, was Manager of Government Products in
Pilcher’s department and reported to Roberts. Maurine Heaton, age
60, held the position of Accounting/Financial Specialist.
However, she did not report to Lonnie Roberts, but instead was
supervised by Robin Roberts.
4
reorganized.
Pilcher filed suit against CEC in August 1993. CEC filed a
Motion for Summary Judgment in January 1996. In August 1996, the
district court granted CEC’s motion, concluding that there was no
direct evidence of intentional age discrimination and that Pilcher
had failed to establish a prima facie case through indirect
evidence.
II
ANALYSIS
A. STANDARD OF REVIEW
On appeal from summary judgment, we review the record de novo
"under the same standards which guided the district court."3
Summary judgment is appropriate when no issue of material fact has
been shown and the moving party is entitled to judgment as a matter
of law.4 In determining whether summary judgment was proper, all
facts are viewed in the light most favorable to the nonmovant.
The granting of summary judgment is especially questionable in
employment discrimination cases,5 as these cases involve "nebulous
questions of motivation and intent."6 Thus, when any facts are in
3
Walker v. Sears, Roebuck & Co., 853 F.2d 355, 358 (5th Cir.
1988).
4
FED.R.CIV.P. 56(c).
5
Hayden v. First Nat’l Bank, 595 F.2d 994, 997 (5th Cir.
1979).
6
Thornbrough v. Columbus & Greenville R.R. Co., 760 F.2d 633,
640 (5th Cir. 1985).
5
dispute, summary judgment is generally inappropriate.7 A plaintiff
should withstand summary judgment when he has created a genuine
issue of material fact, even if he has failed to establish all the
elements of his case by a preponderance of the evidence.8
B. APPLICABLE LAW
Under the ADEA, it is unlawful for an employer to discharge an
employee based on age.9 A plaintiff must prove intentional
discrimination to establish a violation. “Because direct evidence
of employment discrimination is rare, courts have devised indirect
or inferential methods of proving such discrimination,”10 following
the three-step McDonnell Douglas burden-shifting analysis.11
i. Did Pilcher establish a prima facie case?
In step 1, a plaintiff must present a prima facie case; if
successful in so doing, he establishes a rebuttable presumption of
discrimination.12 A prima facie showing of age discrimination
requires a plaintiff to present proof that he was: (1) discharged;
7
Id. at 641.
8
Id. at 641 n.8.
9
29 U.S.C. § 623(a)(1).
10
Davis v. Chevron U.S.A., Inc., 14 F.3d 1082, 1085 (5th Cir.
1994) (citing Texas Dep’t of Community Affairs v. Burdine, 450 U.S.
248, 101 S.Ct. 1089, 67 L.Ed.2d 207 (1981)).
11
McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct.
1817, 36 L.Ed. 668 (1973).
12
Armendariz v. Pinkerton Tobacco Co., 58 F.3d 144, 149 (5th
Cir. 1995).
6
(2) qualified for the position; (3) within the protected class; and
(4) either (i) replaced by someone outside the protected class,
(ii) replaced by someone younger, or (iii) otherwise discharged
because of his age.13 Generally, when an employee has been
replaced, prongs (i) and (ii) of the fourth element apply; and when
there has been a RIF, prong (iii) applies.14 To establish a prima
facie case in a RIF situation, the plaintiff is required to present
evidence showing that the employer did not treat age as a neutral
factor in its decision-making process.15 What is suspicious is not
the firing of a qualified, older employee, but the firing of such
an employee while retaining younger employees.16 When this occurs,
the employer is required to articulate a nondiscriminatory reason
for that decision.17
Pilcher contends that he was replaced by Newell and insists
that Newell assumed Pilcher’s responsibilities. We have previously
held that a plaintiff is entitled to a jury trial when he presents
evidence that some of his duties were assumed by a replacement
13
Id. at 149, (citing Bodenheimer v. PPG Indus., Inc., 5 F.3d
955, 957 (5th Cir. 1993)).
14
Meinecke v. H & R Block of Houston, 66 F.3d 77, 83 (5th Cir.
1995).
15
Armendariz, 58 F.3d at 150, (citing Amburgey v. Corhart
Refractories Corp., 936 F.2d 805, 812 (5th Cir. 1991)).
16
EEOC v. Manville Sales Corp., 27 F.3d 1089, 1096;
Thornbrough, 760 F.2d at 644.
17
Thornbrough, 760 F.2d at 644.
7
employee.18 We today conclude that the summary judgment evidence
in the instant case presents a genuine issue of material fact as to
whether Pilcher was replaced or merely terminated as part of a RIF.
According to Pilcher, during the six months preceding his
termination, Newell held himself out to a representative of a third
party contractor as Manager of Contracts. In Pilcher’s performance
review, CEC had encouraged a more aggressive search for his own
successor. Newell claims that following Pilcher’s layoff, he
(Newell) “took over.” Other employees confirm that Newell was “in
[Pilcher’s] office” and “assumed” Pilcher’s duties. The record
indicates that Newell assumed managerial responsibility for
existing projects, as well as for proposals and spares.
CEC’s organizational charts show that Pilcher’s former
position was not reorganized until approximately six months after
his layoff. And, when it was reorganized, Newell ceased to manage
spares; CEC had transferred that responsibility to another
department. By 1994, Newell was no longer responsible for pricing
or proposals. Newell’s sole remaining responsibility was managing
contracts, which had represented approximately 60 percent of
Pilcher’s workload.
We have not seen any summary judgment evidence to suggest that
Newell’s position following Pilcher’s layoff was anything other
than a one-on-one replacement. There is no evidence that several
18
See Young v. City of Houston, Texas, 906 F.2d 177, 182 (5th
Cir. 1990).
8
jobs were conflated into one; instead, Newell simply assumed all of
Pilcher’s responsibilities, no more and no less. As Newell
acquired his original position, Government Contracts Administrator,
only months preceding Pilcher’s layoff, CEC appears to have
replaced the older Pilcher with the younger Newell. His
responsibilities appear to have been identical to Pilcher’s for the
first six months following Pilcher’s firing. Although the position
was eventually restructured, its essence —— managing contracts ——
remained the same.
CEC insists that Pilcher’s firing was entirely motivated by
its plans under the RIF. RIF cases —— particularly those involving
grants of summary judgment —— generally involve facts that clearly
dictate such a finding, unlike the murky, ambiguous facts of the
instant case. For example, in Meinecke v. H&R Block of Houston, we
found a RIF to be an adequate explanation when an employer had
eliminated an employee’s position, closed the office in which the
discharged employee had worked, and distributed the employee’s
duties among other employees as part of a reorganization.19 In
Armendariz v. Pinkerton Tobacco Co., we found a RIF to be a
creditable reason for termination when an employer discharged the
employee, assigned a small portion of his work to another employee
without granting a pay increase to the assignee of that work, and
assigned the bulk of the first employee’s work to an independent
19
66 F.3d at 84.
9
broker.20 We found that the position in question truly had been
eliminated.21 Finally, in Brown v. CSC Logic, Inc., we found that
when a younger employee had been assigned some of the duties of a
terminated employee sixteen months prior to termination and the
remainder of the duties had been assumed by an older employee, this
employee’s position was legitimately eliminated in a RIF.22
CEC relies heavily on the Sixth Circuit’s opinion in Barnes v.
GenCorp., Inc.23 to support its argument that Pilcher was not
replaced. To the contrary, though, Barnes supports our conclusion
that a genuine issue of material fact exists regarding whether
Pilcher was replaced. According to Barnes, a RIF occurs when
business considerations cause an employer to
eliminate one or more positions within the
company. An employee is not eliminated as
part of a work force reduction when he or she
is replaced after his or her discharge.
However, a person is not replaced when another
employee is assigned to perform the
plaintiff’s duties in addition to other
duties, or when the work is redistributed
among other existing employees already
performing related work. A person is replaced
only when another employee is hired or
reassigned to perform the plaintiff’s duties.24
Technically, Newell was an existing employee who assumed
20
58 F.3d at 149-50.
21
Id. at 150.
22
82 F.3d 651, 655 (5th Cir. 1996).
23
896 F.2d 1457 (6th Cir. 1990).
24
Id. at 1465.
10
related duties upon Pilcher’s termination. It is incongruous,
however, to allow an employer to evade the finding of “replacement”
by simply: (1) determining the need for an assistant manager;
(2) filling that position with a younger employee; (3) determining
a need for a RIF; (4) terminating the older manager, without even
considering the younger employee for layoff; and, (5) consolidating
the two positions so that the younger employee assumes essentially
all of the duties for which the older employee had been
responsible. Even though it is not plain from the record that this
series of events occurred, there is sufficient summary judgment
evidence in the record on appeal to establish a prima facie case
and create a jury question.
ii. Did CEC articulate a legitimate, nondiscriminatory reason for
its decision?
We are constrained in this case to proceed to step 2 of the
McDonnell Douglas burden-shifting analysis. Because Pilcher made
a prima facie showing of age discrimination, it was incumbent on
CEC to establish a legitimate, nondiscriminatory reason for its
decision to terminate him.25 Toward this end, CEC maintains that
the RIF was necessary due to a decrease in overall sales and a
decrease in government contracts. According to CEC, age was not a
factor it considered in the decision to terminate Pilcher; rather,
that decision was based on Lonnie Roberts’ recommendation to
eliminate superfluous managerial and supervisory personnel while
25
Armendariz, 58 F.3d at 149.
11
expanding the responsibilities of the managers who remained.
Facially, this is a legitimate, nondiscriminatory reason, and is
sufficient to shift responsibility back to Pilcher to establish
pretext.
iii. Was CEC’s reason a pretext?
The law is well settled that when an employee establishes a
prima facie case and the employer responds with a benign reason, we
proceed to step 3 of the McDonnell Douglas minuet: Once the
employer has met the burden of articulating a legitimate,
nondiscriminatory reason, the presumption of discrimination fades
and the plaintiff must prove by a preponderance of the evidence
that the employer’s articulated reason is a pretext for unlawful
discrimination.26 To establish pretext, a plaintiff cannot merely
rely on his subjective belief that discrimination has occurred.27
Rather, he must demonstrate discriminatory intent "either directly
by persuading the court that a discriminatory reason more likely
motivated the employer or indirectly by showing that the employer’s
proffered explanation is unworthy of credence."28 The critical test
is whether age "actually played a role in" and "had a determinative
26
Id. (citing St. Mary’s Honor Ctr. v. Hicks, 509 U.S. 502, 113
S.Ct. 2742, 125 L.Ed.2d 407 (1993).
27
Waggoner v. City of Garland, Texas, 987 F.2d 1160, 1166 (5th
Cir. 1993).
28
Texas Dept. of Community Affairs v. Burdine, 101 S.Ct. 1089,
1095 (1981); Bienkowski v. American Airlines, Inc., 851 F.2d 1503,
1506 (5th Cir. 1988); Hall v. Gillman, Inc., 81 F.3d 35, 37 (1996).
12
influence on" the employer’s decision-making process.29 To avoid
summary judgment, however, a plaintiff is not required to prove
pretext; he need only raise a genuine issue of fact regarding
pretext.30 As we stated recently, “a plaintiff can avoid summary
judgment if the evidence taken as a whole, (1) creates a fact issue
as to whether each of the employer’s stated reasons were what
actually motivated the employer, and (2) creates a reasonable
inference that age was a determinative factor in the actions of
which the plaintiff complains.”31
Pilcher asserts that CEC’s proffered reason for his layoff ——
a RIF brought on by a dramatic decrease in government contracts ——
is a pretext. He claims to have had enough work to keep him busy
for the next few years. He also points to the fact that the
younger Newell was hired specifically to work in government
contracts just three months prior to the RIF, yet was never
considered to be a candidate for layoff. CEC counters with
evidence that government contracts constituted a decreasing portion
of its total revenue, with such business reaching its nadir in
1992, the year Pilcher was laid off. CEC also adduced evidence
that its total sales decreased each year after 1990.
29
Armendariz, 58 F.2d at 149, (citing Hazen Paper Co. v.
Biggins, 113 S.Ct 1701, 1706 (1993)).
30
Thornbrough, 760 F.2d at 646.
31
Hall, 81 F.3d at 37 (citing Rhodes v. Guiberson Oil Tools,
75 F.3d 989, 993 (5th Cir. 1996) (en banc)).
13
Even if we assume that a decrease in government contracts
necessitated a RIF at CEC, the essential inquiry remains whether
the otherwise justified RIF was used to mask an age discriminatory
replacement situation. A RIF —— a benign reason for layoffs ——
cannot be used surreptitiously to effect age discrimination.
Further, the fact that Newell had a law degree does not validate
CEC’s decision to retain him, as the company stated that a law
degree was not a criterion of eligibility for the position. We
conclude in this case that, in light of the strong replacement
facts and other evidence, a jury could reasonably find that
Pilcher’s age was a determinative influence on Pilcher’s discharge.
Pilcher’s evidence of a one-on-one replacement by Newell is
supported by additional evidence of age discrimination. Pilcher
has shown that two other older employees were laid off after being
required to train their own younger successors. The record shows
also that Lonnie Roberts stated that CEC employees didn’t “walk
with a purpose” and that upon meeting Pilcher he inquired about his
heart condition. Even though these comments could be interpreted
as mere chance remarks, they are susceptible of being interpreted
as reflecting an age bias as well. Pilcher also contends that
Roberts treated older employees more harshly than younger
employees. Finally, Pilcher states that during Newell’s job
interview, at which Pilcher was present, Roberts stated that
Pilcher was “retiring.”
14
In Atkinson v. Denton Publishing Co.,32 we reversed summary
judgment for an employer after finding that the discharged employee
had presented sufficient evidence to create genuine issues of
material fact as to whether the employer’s reasons for his
discharge were pretextual. The employee in Atkinson submitted
evidence to rebut the employer’s articulated reason, as well as
evidence that the general manager: (1) preferred to deal directly
with the younger, less experienced subordinates; (2) told another
employee that he preferred solving problems with younger employees
because the discharged employee had “old ideas and old ways”;
(3) gave raises to younger employees while withholding them from
older employees; and (4) laid off other older employees and
replaced them with younger workers.33 Here, Pilcher, like the
plaintiff in Atkinson, offered summary judgment evidence that we
deem sufficient to create a jury question on pretext.
III
CONCLUSION
Inasmuch as our plenary review satisfies us that Pilcher did
establish a prima facie case of age discrimination and presented
sufficient summary judgment evidence to demonstrate the existence
of a genuine issue of material fact regarding the RIF as possible
pretext for discriminatory replacement, we reverse the summary
32
84 F.3d 144 (5th Cir. 1996).
33
Id. at 149-50.
15
judgment granted by the district court in favor of CEC and remand
for further proceedings consistent herewith.
REVERSED and REMANDED.
16