Nasti v. CIBA Specialty Chemicals Corp.

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
July 12, 2007
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk

No. 06-20370

JOANNE MACKAY NASTI,
Plaintiff -Appellant,

versus

CIBA SPECIALTY CHEMICALS,

Defendant-Appellee.

Appeal from the United States District Court
for the Southern District of Texas

Before JONES, Chief Judge, and Judges BENAVIDES and STEWART, Circuit Judges.

CARL E. STEWART, Circuit Judge:

This appeal arises from JoAnne Nasti’s claims against CIBA SpecialtyChemicals Corporation

for sex discrimination and defamation. Nasti appeals the district court’s summary judgment ruling for

CIBA. We affirm.

I. FACTUAL AND PROCEDURAL BACKGROUND

Nasti began her employment with Ciba in 1997. In 2002, Nasti accepted the position of Global

Account Executive and became the manager of Ciba’s Dow Global account, a position Ciba classified

as “Grade 11.” At that time, Nasti was designated at “Grade 10.” Ciba management informed Nasti
that her personnel ranking would remain at Grade 10 until she demonstrated her ability to fulfill the

requirements of the position and manage a Grade 11 account.

In 2003, Nasti communicated with Stephan Bocken, President of Ciba’s Paper Division in

Switzerland, who expressed an interest in discussing a possible position for Nasti in his division. In

October 2003, Nasti met with David Almond, a sales director who reported to Bocken, to discuss

a potential sales manager position. Nasti indicates that she was later informed by Bocken and Almond

that they had been told that she was on a performance improvement plan and was “untouchable” in

the company.

Ciba concedes that Nasti met with Almond to discuss a possible position in Bocken’s division;

however, Ciba asserts that the position for which Nasti interviewed had not yet been approved for

recruitment and ultimately never developed into an opening. Rather, Almond’s segment decided to

assign the duties that would have been performed by the new manager to existing account managers

and then used the opening to replace a different key role in the division that Nasti was not qualified

to hold.

Also in 2003, Nasti agreed to assist with Bostik Findley, one of Ciba’s smaller clients, after

a Ciba competitor offered the Bostik Findley facility in Milwaukee a low price on a product. In

August 2003, Nasti visited Bostik Findley’s Milwaukee facility with Chris Fagouri, the Ciba

representative who was the primary contact for the Bostik Findley account. Nasti combined this trip

to Bostik Findley with a personal trip to see her daughter in South Bend, Indiana, which Nasti had

already scheduled. To accommodate the need for the meeting, Nasti adjusted her return flight so that

she would be able to meet with Bostik Findley representatives on Monday, August 25, 2003. Nasti

used her personal frequent flyer miles for the trip, and Ciba incurred no expense for Nasti’s airfare,

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despite the fact that Nasti was entitled to charge the tickets to Ciba under company policy. At the

August 25 meeting, Nasti and Fagouri met with Bostik Findley representatives Barb Brown, Gary

Delzell, and Gary Wilkes, who agreed to consider a Ciba product that could match the pricing offered

by Ciba’s competitor.

Nasti then scheduled a follow-up visit in Milwaukee with Barb Brown for September 22,

2003. Due to Chicago’s close proximity to Milwaukee, Nasti booked a non-refundable ticket for the

trip through Chicago. A week later, Nasti learned that Gary Delzel had replaced Brown in her

purchasing role at Bostik Findley. On September 19, Nasti departed for Chicago and called Gary

Delzel from the airport to confirm the Monday meeting. Nasti discovered that Brown had not

informed Delzel of the meeting; however, because she had booked a non-refundable ticket, she

decided to make the trip and planned to meet with Bostik Findley’s technical personnel who would

be evaluating Ciba’s product. Upon arriving in Chicago, Nasti drove to South Bend, Indiana, to see

her daughter and brother. Nasti testified that it was “a routine practice and allowable at Ciba to

combine business and personal matters while traveling, especially over a weekend.”

On Saturday, September 20, Nasti learned that she would be able to schedule an urgent

meeting for her major ExxonMobil account on September 25, 2003. Nasti therefore decided to return

to her office in Houston on Monday, September 22 without visiting the Bostik Findley facility, so that

she could begin planning for the ExxonMobil meeting. On September 22, Nasti flew to Houston and

went directly to her office, where she participated in conference calls with Becherer and others

regarding the ExxonMobil account.

Nasti submitted expense reports seeking reimbursement for two trips to Bostik Findley, one

in August and one in September. For the September trip, Nasti sought reimbursement for her rental

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car, dinner, tolls, and airport parking, for a total of $270.00. In November 2003, Becherer asked

Nasti to explain the expenses and to submit call reports, which are documents detailing client

meetings, as Ciba’s protocol required. Nasti forwarded to Becherer a call report for the August trip,

which she had previously submitted to him. Nasti also submitted to Becherer a call report detailing

the second trip in September. This call report indicated that Nasti had “scheduled this meeting with

Gary Wilkes to discuss and close.” The call report then stated that “Gary began the meeting . . . . He

asked why we hadn’t yet provided a sample and I showed him the shipping documentation. He

excused himself from the table and returned with the sample in his hand. He had found it on Barb’s

desk.”

Nasti testified in her affidavit that Becherer was familiar with her need to abandon the

September Bostik Findley trip in order to return to Houston to plan for the ExxonMobil meeting, as

Becherer had participated in the conference calls with her on September 22. Nasti assumed that

Becherer needed her to satisfy internal auditing standards for the rental car expense and wrote the call

report with this in mind. Nasti alleges that she had no intention of deceiving anyone and wrote the

call report to memorialize what took place during the telephone calls that had substituted for her

intended visit to the Bostik Findley facility. Nasti also maintains that the charges for which she had

sought reimbursement were legitimate business expenses.

Becherer testified by affidavit that he found Nasti’s call report for the September trip

troubling. Nasti had submitted the report only after he asked her to document expenses that she had

already turned in for reimbursement. Becherer had also instructed Nasti to make only one visit to the

Bostik Findley facility in Milwaukee and thereafter to handle the account from Houston. Finally,

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Becherer felt that the report lacked “meat” and “failed to show why another visit to Bostik Findley’s

Milwaukee facility was necessary.” Becherer wondered whether the trip had actually occurred.

By this time in late 2003, Ciba’s management had begun discussing whether or not Nasti had

a future at Ciba. Nasti’s managers felt that while Nasti had strong business skills, she had also

demonstrated sufficient deficiencies in key areas such as team-building, counseling employees,

listening to peers, enlisting support, and providing feedback. Around the Thanksgiving holiday,

Nasti’s various managers, with input from Ciba’s Human Resources group, decided to terminate

Nasti for these performance reasons. The group chose not to discharge Nasti prior to the holidays,

but rather to wait until January 2004.

Between the time when Ciba management decided to terminate Nasti in late November

2003 and efforts to arrange a meeting with Nasti in January 2004, Becherer followed up on the call

report Nasti had previously submitted for the September trip to the Bostik Findley facility. After

Becherer contacted Bostik Findley and learned that the September meeting had not taken place,

Becherer discussed Nasti’s call report with his supervisor, Bill Baker, and Human Resources manager

Gregory Policastro. Becherer, Baker, and Policastro concluded that Nasti had submitted a false call

report. Because they believed that Nasti’s call report overshadowed the existing issues concerning

her performance, they decided to terminate Nasti’s employment for the allegedly false call report and

the submission of expenses in connection with the call report.

Because Nasti had taken a disability leave of absence in early January 2004, Policastro and

Becherer informed Nasti of her termination in a telephone call, which took place on January 20, 2004,

and in which her husband, Gary Nasti, participated. Policastro testified that when first asked about

the second Bostik Findley trip in September 2003, Nasti maintained that she had attended this second

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meeting at the customer’s location. After Becherer told Nasti that he had contacted Bostik Findley

and learned that the second meeting did not take place, Nasti explained that she had cancelled the trip

in light of the ExxonMobil meeting and that her call report described the telephone calls that took

place in lieu of the meeting.

Nasti subsequently filed a lawsuit in federal district court, contending that Ciba discriminated

against her on the basis of her gender and terminated her in violation of the FMLA. In her Second

Amended Complaint, Nasti added a claim against Ciba for defamation. After a hearing, the district

court granted summary judgment for CIBA. Nasti appeals the district court’s rulings on her gender

discrimination and defamation claims.

II. STANDARD OF REVIEW

The applicable standard of review is de novo. See Urbano v. Continental Airlines, Inc., 138

F.3d 204, 205 (5th Cir. 1998). Summary judgment is proper if the evidence shows that there is no

genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of

law. Kee v. City of Rowlett, 247 F.3d 206, 210 (5th Cir. 2001) (quotations omitted). The Court views

all evidence in the light most favorable to the non-moving party and draws all reasonable inferences

in that party’s favor. Crawford v. Formosa Plastics Corp., 234 F.3d 899, 902 (5th Cir. 2000).

III. DISCUSSION

A. Discriminatory Termination

Title VII prohibits an employer from discriminating “against any individual with respect to

his compensation, terms, conditions, or privileges of employment, because of such individual’s race,

color, religion, sex, or national origin.” 42 U.S.C. § 2000e-2(a)(1). A plaintiff may prove Title VII

discrimination through direct evidence or circumstantial evidence. Laxton v. Gap Inc., 333 F.3d 572,

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578 (5th Cir. 2003); Russell v. McKinney Hosp. Venture, 235 F.3d 219, 222 (5th Cir. 2000). Where

there is no direct evidence of discrimination, as Nasti concedes is the case here, a plaintiff may prove

a case of sex discrimination with circumstantial evidence, using the burden shifting framework

established by McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973). See Wallace v.

Methodist Hosp. Sys., 271 F.3d 212, 219 (5th Cir. 2001).

Under the McDonnell Douglas framework, a plaintiff must first establish a prima facie case

of sex discrimination. Wallace, 271 F.3d at 219. The employer then bears the burden of producing

a legitimate, non-discriminatory reason for its actions. Id. The employer is not required to convince

the Court that it was actually motivated by this reason; it need only raise a genuine issue of fact as

to whether or not it discriminated against the plaintiff. Tex. Dep’t of Cmty. Affairs v. Burdine, 450

U.S. 248, 254 (1981). Once the employer offers a legitimate, nondiscriminatory reason for the

plaintiff’s treatment, the presumptions of the McDonnell Douglas framework dissipate, and the

plaintiff bears the ultimate burden of persuading the trier of fact that the defendant engaged in

intentional discrimination. Wallace, 271 F.3d at 219; Russell, 235 F.3d at 222. To satisfy this burden,

a plaintiff must produce substantial evidence that the employer’s proffered reasons for its actions were

a pretext for discrimination. Wallace, 271 F.3d at 220. A plaintiff can establish pretext “either through

evidence of disparate treatment or by showing that the employer’s proffered explanation is false or

‘unworthy of credence.’” Laxton, 333 F.3d at 578 (quoting Reeves v. Sanderson Plumbing Prods.,

Inc., 530 U.S. 133, 143 (2000)).

To establish a prima facie case, Nasti must demonstrate that (1) she belongs to a protected

group, (2) she was qualified for her position, (3) she suffered an adverse employment action; and (4)

she was replaced with a similarly qualified person who was not a member of her protected group, or

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in the case of disparate treatment, that similarly situated employees were treated more favorably.

Okoye v. Univ. of Tex. Houston Health Sci. Ctr., 245 F.3d 507, 512-13 (5th Cir. 2001).

Viewing the evidence in the light most favorable to the nonmoving party, we hold that Nasti

has asserted a prima facie case and the burden shifts to Ciba to articulate a legitimate,

non-discriminatory reason for terminating Nasti.1 Ciba has met its burden of producing a legitimate

reason, which is that Nasti submitted a false call report. Accordingly, Nasti must raise a genuine issue

of material fact as to whether this explanation is merely pretext, such that a reasonable factfinder

could infer discrimination.

The pretext inquiry focuses on the authenticity of the employer’s proffered reason. “In

appropriate circumstances, the trier of fact can reasonably infer from the falsity of the explanation that

the employer is dissembling to cover up a discriminatory purpose. Such an inference is consistent with

the general principle of evidence law that the factfinder is entitled to consider a party’s dishonesty

about a material fact as ‘affirmative evidence of guilt.’ Wright v. West, 505 U.S. 277, 296 (1992).

A “plaintiff’s prima facie case, combined with sufficient evidence to find that the employer’s asserted

justification is false, may permit the trier of fact to conclude that the employer unlawfully

discriminated.” Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 148 (2000).

Nasti argues that Ciba has offered two inconsistent explanations for her termination. Nasti

argues that Ciba states it terminated her for a false call report while at the same time stating that it

terminated her for performance related reasons. A court may infer pretext where a defendant has

provided inconsistent or conflicting explanations for its conduct. See Read v. BT Alex Brown Inc.,

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Ciba conceded, for the sake of argument, in its summary judgment motion before the district
court that Nasti asserted a prima facie case. See Nasti v. Ciba Specialty Chemicals, No. H-04-04590
(S. D. Tex. February 1, 2006).

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72 Fed. Appx. 112, 120, 2003 WL 21754966, at *7 (5th Cir. 2003). The district court found that

Ciba’s two explanations were not, in fact, inconsistent but rather two separate, independent decisions

to terminate Nasti. The district court relied on the testimony of Becherer, Baker, and Policastro that

the decision to terminate Nasti for the false call report and the submission of expenses in connection

with that call report overrode and superseded all other problems with Nasti’s performance and the

previous decision to terminate her. Nasti responds by arguing that although there could have been

two independent rationales used by Ciba to terminate her, a reasonable factfinder could infer from

the inconsistencies that the profferred reason for Nasti’s termination was pretextual. The district

court’s analysis is compelling. Ciba has not provided inconsistent reasons. Ciba has consistentlystated

that while it planned to terminate Nasti for performance related reasons, its ultimate decision to

terminate her was based on the alleged falsification of the expense and call reports. Even if we are

to assume that the two justifications are inconsistent, they are not sufficient as to raise a material issue

of fact as to whether Ciba’s ultimate decision to terminate Nasti was a pretext for discrimination

Therefore, Nasti’s pretext claim rests on whether Ciba’s justification, that Nasti falsified a call

report, was false. Nasti argues that Ciba, specifically her supervisor Becherer, knew she could not

attend the second meeting in Milwaukee. She points to the fact that she was on a conference call with

Becherer on September 22 as evidence. Based on her version of facts, Nasti’s argument is plausible.

If Becherer participated in an emergency conference call with Nasti the Monday following her

weekend trip, he would have no reason to inquire later as to whether she was at a sales meeting in

Milwaukee that very same day. And because of the emergency nature of the September 22 meeting,

he would also understand why Nasti had to cut short her trip and plans to visit Milwaukee. He would

also understand why Nasti would nonetheless bill Ciba for the expenses incurred the weekend before

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the cancelled trip. If the record bore this out, this would raise a material fact issue as to whether

Ciba’s legitimate nondiscriminatory reason was actually false.

The record, however, does not reflect Nasti’s version of events. Becherer testified in an

affidavit that he was unaware that Nasti cancelled the second meeting in Milwaukee when he received

her call report and her email justifying the expense. Becherer, Baker, and Policastro all testified that

they believed Nasti attempted to mislead the company in the call report. Policastro testified in an

affidavit that Nasti only acknowledged that she had not visited Milwaukee for the second trip after

he confronted her in a phone conversation. Policastro’s affidavit states that Nasti maintained that she

made the visit to Milwaukee in emails, the call report itself, and in phone conversations between

November 10, 2003, and January 20, 2004, when Policastro told her that he had spoken with the

client.

Viewing all the evidence in Nasti’s favor, there is no evidence suggesting anyone else knew

of Nasti’s second trip, including Policastro, Ciba’s HR Manager, who informed Nasti of the decision

to terminate. Even if we assume that Becherer influenced Policastro with discriminatory animus, see

Russell v. McKinney Hosp. Venture, 235 F.3d 219, 226-7 (5th Cir. 2000) (stating that if

decisionmaker rubber stamps the wishes of others, that decisionmaker could inherit discriminatory

taint), Policastro testified that after questioning her regarding the report, Nasti maintained to him

personally that the second meeting had taken place.

Nasti’s argument that she justified the report because she felt that this was what Becherer

wanted is plausible but this does not prove or raise a material issue as to whether Ciba’s reasonably

believed that her call report was false or whether it terminated her for that reason. After viewing all

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the evidence in Nasti’s favor, the record demonstrates that Ciba thought Nasti turned in a false report

and that Ciba terminated Nasti for that reason.

Alternatively, Nasti argues for the first time on appeal that her employer had mixed-motives

for terminating her. This court has noted that “no bright-line rule exists for determining whether a

matter was raised below.” See N.Y. Life Ins. Co. v. Brown, 84 F.3d 137, 142 n.4 (5th Cir. 1996).

Nonetheless, if a “litigant desires to preserve an argument for appeal, the litigant must press and not

merely intimate the argument during the proceedings before the district court. If an argument is not

raised to such a degree that the district court has an opportunity to rule on it, we will not address it

on appeal.” FDIC v. Mijalis, 15 F.3d 1314, 1327 (5th Cir. 1994).

Because she failed to present her mixed-motives claim to the district court in the first instance,

Nasti has waived it. Nasti’s claims that she never falsified a call report conflicts with a mixed-motive

theory of recovery, whereby plaintiffs allege that the legitimate nondiscriminatory reason is not the

primary reason for termination. Nasti never conceded before the district court, even for argument’s

sake, that Ciba had a legitimate nondiscriminatory reason to terminate her. Thus, it cannot be said that

the district court had the opportunity to rule on her mixed-motive claim.

B. Defamation Claim

Nasti alleges that the district court erred by not finding this statement published in Ciba’s 2004

Annual Report defamatory: “In 2004 there were two incidents that merited disciplinary action: a

conflict of interest in materials purchasing and a serious abuse of expense claims. Those responsible

are no longer employed by the company.” Nasti argues that while Ciba’s 2004 Annual Report does

not specifically mention her, it implicates her by innuendo to persons who are familiar with her

situation as the employee responsible for the abuse of expense claims.

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 For a plaintiff who is not a public figure to establish a defamation claim under Texas law, the

plaintiff must prove that the defendant: (1) published a statement; (2) that was defamatory concerning

the plaintiff; (3) while acting negligently with regard to the truth of the statement. WFAA-TV, Inc.

v. McLemore, 978 S.W.2d 568, 571 (Tex. 1998). A statement may be libel even when it is not

obviously hurtful on its face and requires extrinsic facts or circumstances to explain its defamatory

meaning. Bell v. Orlando Daily Newspapers, Inc., 389 F.2d 579, 582 (5th Cir. 1967). Innuendo may

be used to evidence a statement’s meaning by connecting the allegedly defamatory statement with

extrinsic facts and circumstances. Moore v. Waldrop, 166 S.W.3d 380, 386 (Tex. App. 2005).

The district court held that Nasti had failed to raise a material issue of fact that the statement

referred to her. The court concluded that she had failed to present any evidence “other than her own

assumptions . . . that the statement in the annual report referred to her or that it could reasonably be

read to refer to her.” The district court relied on testimony from Thomas Koch, General Counsel for

Ciba’s global affiliate that publishes the annual report, that the reference was not related to Nasti but

to an employee at the company’s Basel, Switzerland office.

Nasti has not pointed to any evidence in the record that this court could construe in her favor.

Other than her own beliefs, there is nothing else in the record that supports the view that the

statement in the Annual Report concerned her. See Little v. Liquid Air Corp., 37 F.3d 1069, 1075

(5th Cir. 1994) (en banc) (“We resolve factual controversies in favor of the nonmoving party, but

only when there is an actual controversy, that is, when both parties have submitted evidence of

contradictory facts. We do not, however, in the absence of any proof, assume that the nonmoving

party could or would prove the necessary facts.”). For the foregoing reasons, we affirm.

IV. CONCLUSION

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The judgment of the district court is AFFIRMED.

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