Opinion
Case No. 98 C 5181
September 15, 2000
MEMORANDUM OPINION AND ORDER
FACTUAL BACKGROUND
Richard Kadas accepted a job as a Senior Consultant for MCI Systemhouse Corporation on August 11, 1997; he was just shy of his 55th birthday at the time. Kadas was hired by Steven Bryant, a delivery skills manager in the company's Great Lakes region, who was 56 when he hired Kadas. Bryant hired Kadas because Kadas' background and experience in the Information Technology healtheare industry made him an ideal match for the projects MCI Systemhouse was handling for Anthem, a large healtheare conglomerate. Shortly after Kadas joined MCI Systemhouse, however, Anthem pulled its work from the company. Shortly after that, MCI Systemhouse decided to discontinue its national healtheare industry practice. As a result, Bryant was forced to lay off three employees in January 1998, and Kadas ended up making the hit list. Kadas's position was officially eliminated as of January 26, 1998; Kadas was 55 at the time and had been with the company just over five months.
Kadas filed a discrimination charge with the EEOC, alleging that he was "discriminated against on the basis of [his] age . . . in that employees over the age of 50 were disproportionately laid off." Complaint, Exhibit 1. He received a right-to-sue letter on May 22, 1998 and then filed this lawsuit on August 20, 1998, alleging violation of the Age Discrimination in Employment Act, 29 U.S.C. § 623 (a). The case is before the Court on MCI Systemhouse's motion for summary judgment.
DISCUSSION
Summary judgment is proper when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show 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." Fed.R.Civ.P. 56(c). In determining whether a genuine issue of material fact exists, courts must construe all facts and draw all reasonable and justifiable inferences in favor of the non-moving party. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). "[N]either `the mere existence of some alleged factual dispute between the parties,' nor the existence of `some metaphysical doubt as to the material facts,' is sufficient to defeat a motion for summary judgment." Chiaramonte v. Fashion Bed Group, Inc., 129 F.3d 391, 395 (7th Cir. 1997), cert. denied, 523 U.S. 1118 (1998) (quoting Anderson, 477 U.S. at 247; Matsushita Electric Industrial Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)).
The ADEA prohibits discrimination based on an employee's age. 29 U.S.C. § 623 (a)(1). To succeed on his ADEA claim, Kadas must establish that he would not have been laid off "`but for' his employer's intentional age-based discrimination." Chiaramonte, 129 F.3d at 396 (quoting Konowitz v. Schnadig Corp., 965 F.2d 230, 232 (7th Cir. 1992)); Miller v. Borden, Inc., 168 F.3d 308, 312 (7th Cir. 1999) (citing Adreani v. First Colonial Bankshares Corp., 154 F.3d 389, 393 (7th Cir. 1998)). Kadas can establish discrimination either by direct evidence or by the indirect burden-shifting method set out in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973); Kadas argues that his evidence allows him to proceed both ways.
To establish discrimination by the direct method, Kadas must produce evidence that the trier of fact can interpret as an acknowledgment or indication of the employer's discriminatory intent; evidence, in other words, that relates "to the motivation of the decision-maker responsible for the contested decision." See Chiaramonte, 129 F.3d at 396 (citing Hill v. Burrell Communications Group, Inc., 67 F.3d 665, 667 (7th Cir. 1995); Cheek v. Peabody Coal Co., 97 F.3d 200, 203 (7th Cir. 1996)). On this score, Kadas claims to have two pieces of evidence. First, he offers the "statistical proof" that all three of the people laid off in Bryant's group of 32 employees were within the protected class; second, he offers the deposition testimony of Robert Chan, a former MCI Systemhouse manager, that "the culture and motivation for job placement and participation in the RIF was age discriminatory." See Plaintiff's Memorandum in Opposition to Summary Judgment, p. 4.
Kadas' statistical evidence fails to prove discriminatory intent. Without evidence about what percentage of the employees in Bryant's group were 40 or over, the fact that all three of the employees laid off in January were within that age group is meaningless. See Dale v. Chicago Tribune Co., 797 F.2d 458, 465 (7th Cir. 1986), cert. denied, 479 U.S. 1066 (1987). Indeed, although the fact that all three of the consultants laid off in January were over 40 seems suspicious at first blush, MCI Systemhouse's personnel information (which Kadas agrees is accurate) shows that 27 of the 32 employees in Bryant's group were age 40 or over. Thus, regardless of how the three employees were targeted, the odds were extremely high that they would wind up being within the protected class. Additionally, Kadas admitted that Bryant selected employees for the RIF based on billable utilization rates and the likelihood of billable work after the healtheare practice shut down; his statistical evidence does nothing to suggest that Bryant deviated from this criteria in order to nail older employees.
Nor does Chan's testimony constitute direct evidence of discriminatory intent. "When a plaintiff proceeds under the direct proof method, allegedly discriminatory statements are relevant . . . only if they are both made by a decision-maker and related to the employment decision at issue." Stopka v. Alliance of American Insurers, 141 F.3d 681, 688 (7th Cir. 1998) (citing Huff v. UARCO, 122 F.3d 374, 384 (7th Cir. 1997)). The evidence Kadas offers fails on both counts: it is undisputed that Bryant, not Chan, made the decision to lay off Kadas; and Chan's speculation as to Bryant's thoughts cannot give rise to a direct inference of discriminatory intent. See Chiaramonte, 129 F.3d at 397 ("[s]tatements by a non-decision-maker that amount to mere speculation as to the thoughts of the decision-maker are irrelevant to our inquiry"). Therefore, Chan's testimony "does not provide the kind of `smoking gun' evidence required for a direct inference of discriminatory intent." Id. In short, Kadas cannot defeat MCI Systemhouse's summary judgment motion on the strength of his direct evidence, and we move on to the McDonnell Douglas method of proof.
To prevail under the McDonnell Douglas burden-shifting approach, Kadas must first establish a prima facie case of age discrimination. He must show that: (1) he was in the protected age group of 40 or older; (2) he was performing his job satisfactorily; (3) he was discharged; and (4) substantially younger, similarly-situated employees were treated more favorably. Chiaramonte, 129 F.3d at 398 (citing O'Connor v. Consolidated Coin Caterers Corp., 517 U.S. 878 (1996); Maier v. Lucent Technologies, 120 F.3d 730, 734 (7th Cir. 1997); Denisi v. Dominick's Finer Foods, Inc., 99 F.3d 860, 864 (7th Cir. 1996)). Assuming Kadas is able to establish a prima facie case, MCI Systemhouse would then be obligated to produce a legitimate non-discriminatory reason for its decision; and assuming MCI Systemhouse is able to do so, the burden shifts back to Kadas to show that MCI Systemhouse's stated reason is in fact a lie or a pretext for discrimination. McDonnell Douglas, 411 U.S. at 802-04. Though the burden of producing evidence shifts between the employee and the employer, "[t]he ultimate burden of persuading the trier of fact that the defendant intentionally discriminated against the plaintiff remains at all times with the plaintiff" St. Mary's Honor Center v. Hicks, 509 U.S. 502, 507 (1993) (quoting Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 253 (1981)). Because MCI Systemhouse has offered a legitimate reason for laying off Kadas, the Court may bypass the prima facie case analysis and move right to steps two and three. See Jaysinghe v. Bethlehem Steel Corp., 760 F.2d 132, 135 (7th Cir. 1995) (the prima facie threshold is no longer a relevant issue once the defendant has come forward with evidence of legitimate reasons for its actions that would rebut a prima facie showing of discrimination) (citing United States Postal Service Board of Governors v. Aikens, 460 U.S. 711, 714-15 (1983)).
MCI Systemhouse argues that it laid off Kadas for business reasons; basically, the company argues that it targeted Kadas for the RIF because the business he was hired to work on dried up and because, after that work went away, Kadas' workload consisted of — and was likely to continue to consist of — strictly non-billable projects. MCI Systemhouse paints a picture of unfortunate circumstances: shortly after Kadas was hired, Anthem, a healtheare industry client whose project work Kadas was specifically hired to handle, pulled its business from MCI Systemhouse; additionally, after losing Anthem's business, MCI Systemhouse decided to discontinue its IT healtheare industry practice — the specific practice area that would have benefitted most from Kadas' expertise. Kadas does not dispute any of this; he admits that Bryant hired him because of his IT background in the healtheare industry and because of the company's need to staff Anthem's work. See Plaintiff's Response to Defendant's Local Rule 56.1(A)(3) Statement of Material Facts, ¶ 14. He even admits that he knew his "fate" was "tied to" the Anthem work to some extent. See Kadas Dep., p. 99. Kadas also admits that, after the Anthem work dried up, he did a couple of short-term billable projects and then worked strictly on non-billable projects until his termination in January 1998. See Plaintiff's Response to Defendant's Local Rule 56.1(A)(3) Statement of Material Facts, ¶ 19. Thus, MCI Systemhouse has satisfied its burden of giving a legitimate, nondiscriminatory reason for laying off Kadas, and the burden shifts back to Kadas to show that the stated reason was a pretext for discrimination.
In assessing whether Kadas can show pretext, the Court must consider the strong inference of nondiscrimination that arises in cases such as this. MCI Systemhouse hired Kadas when he was 54, well within the protected class. Additionally, he was hired and fired by the same person, Steven Bryant (who was himself within the protected class when he hired Kadas), within a short period of time (less than six months). The Seventh Circuit has recognized that such facts give rise to an inference of nondiscrimination because it is "highly doubtful that a person who hired an employee in the protected age group . . . would fire that same employee . . . as a result of a sudden `aversion to older people.'" Chiaramonte. 129 F.3d at 399. See also Roberts v. Separators, Inc., 172 F.3d 448, 452 (7th Cir. 1999) (applying "common actor" inference of nondiscrimination where employee was hired at 61 and fired only one year later); Wolf v. Buss (America) Inc., 77 F.3d 914, 924 (7th Cir.) (finding that company's decision to hire plaintiff at age 50, "although not conclusive, is somewhat indicative of [the company's] lack of discriminatory intent"), cert. denied, 519 U.S. 866 (1996); Rand v. CF Industries, Inc., 42 F.3d 1139, 1147 (7th Cir. 1994) (finding it "rather suspect" that a company that hired plaintiff at age 47 had suddenly developed an aversion to older people two years later). Based on the circumstances of Kadas' short career at MCI Systemhouse, the Court finds that "a strong inference exists that discrimination was not a determining factor" in the decision to lay off Kadas. See Chiaramonte, 129 F.3d at 399; Roberts, 172 F.3d at 452 (citing Proud v. Stone, 945 F.2d 796, 797 (4th Cir. 1991)).
Although the inference of nondiscrimination is rebuttable, see Roberts, 172 F.3d at 452, Kadas' evidence does nothing to undercut MCI Systemhouse's stated reason for laying him off. The evidence on which Kadas bases his case — the personnel information sheet discussed above (exhibit 1 to Defendant's Local Rule 56.1(A)(3) Statement of Material Facts) and Robert Chan's deposition testimony — do not create an issue of fact on the question of pretext. Bryant, who decided which employees to let go as part of the January 1998 RIF, testified that he looked at two criteria in identifying candidates for the RIF: (1) the extent to which the changes within the company affected the employee's fit within the company; and (2) the likelihood that the employee would have billable work (i.e., work for which the company could recover revenue) within the next 30 to 60 days. Bryant Dep., p. 18. See also Defendant's Local Rule 56.1(A)(3) Statement of Material Facts, ¶ 22, and Plaintiff's response thereto. Bryant ultimately selected three employees for the January 1998 RIF: Kadas, Louis Sandoz and Robert Bornholz. Although Kadas alleges that Bryant selected these three because they were old, he has nothing to back that assertion. He admits that he was hired to work on the Anthem projects, which never materialized; he admits that his expertise was primarily in the healtheare industry (and that he believed the same was true for Sandoz); he admits that the company, for reasons he does not allege to be discriminatory or otherwise improper, decided to get rid of its national healtheare industry practice; and he admits that, other than a couple of short-term billable projects, he did mostly non-billable work after the Anthem work dried up. See Plaintiff's Response to Defendant's Local Rule 56.1(A)(3) Statement, ¶¶ 11, 19-20; Kadas dep., pp. 99, 149, 161. In short, Kadas admits that he fit the RIF criteria set out above, and nothing in MCI Systemhouse's personnel statistics changes that.
Robert Chan's deposition testimony similarly fails to create an issue of fact as to Bryant's motivation in selecting Kadas for the RIF. Chan was managing director of healtheare services for MCI Systemhouse from April 1996 until March 1998, when the company fired him. Chan testified that he overheard conversations in which people at the company said that "these guys" — which he took to mean employees over the age of 50 — are "not as fast and not as quick and not as impressive with the customers." Chan Deposition, p. 22. Chan could not recall who made any of the comments, though he knew for sure that it was not Steve Bryant. Id., p. 24. Nor could Chan recall when he overheard the allegedly ageist remarks. Id., p. 23. Chan also testified that he reported the comments to Steve Bryant and tried to tell Bryant that older employees were not being given a chance to work on projects, and that Bryant:
just sort of laughed at it and, no it's not happening and made a comment "Bob, you know how hard" — I'm not using exact words but this is sort of the guts of the conversation. "Bob you know how hard it is to sell these guys and they just don't look like they work as hard." Id. at 30.
Chan admitted that he never heard anyone — including Bryant — specifically talking about older employees. Id., p. 22. He stated that he believed phrases such as "these guys" meant older employees, but he could not explain why this was so. Chan's subjective interpretation of these statements — which cannot even be attributed to Bryant, who made the ultimate decision to layoff Kadas — is hardly surprising and not particularly persuasive. See Chiaramonte, 129 F.3d at 401 (plaintiff's subjective interpretation of his employer's statements not controlling). At the time he gave his deposition testimony in Kadas' case, Chan had his own lawsuit pending against MCI Systemhouse ( Chan v. MCI Systemhouse, No. CC027746 (Cal.Super.Ct., Los Angeles County, Southeast District)), part of which involved allegations that the company fired him after he complained about illegal and unethical conduct including targeting employees over the age of 40. Thus Chan had a lot to gain from making a self-serving record, and without something to support his testimony, his opinions do not undermine the strong inference of nondiscrimination created by the fact that Bryant (who was himself within the protected class) hired Kadas when he was 54 and fired him less than six months later. Chan, like Kadas, seems to think that Kadas should have a claim against the company based on the mere fact that Kadas was hired, "used" for a very short period of time, and then discarded. See Chan Deposition, p. 45. But without something to suggest that he was discarded because of his age, he has no case under the ADEA; if, as the company has said, it discarded him after half a year because the work for which he was hired dried up, the company's actions might seem unfair, but they do not amount to age discrimination.
Chan has since lost that suit; the court entered summary judgment in MCI Systemhouse's favor on April 21, 2000.
CONCLUSION
For the foregoing reasons, MCI Systemhouse Corporation's motion for summary judgment [22-1] is granted. The Clerk is directed to enter judgment in favor of the defendant.