Plaintiffs prevail in separate 2-1 decisions. The Fifth Circuit splits with the Seventh Circuit, and affirms the availability of mixed-motive analysis in a Title VII retaliation case, upholding a jury verdict for the plaintiff. In the Sixth Circuit, the panel majority holds that the district court abused its discretion in denying a former employee two depositions of senior management figures in an ADEA case, vacates summary judgment and remands the case with directions to allow the discovery.
Smith v. Xerox Corp., No. 08-11115 (5th Cir. Mar. 24, 2010): Gross v. FBL Financial Services, Inc., 129 S. Ct. 2343 (2009), has produced a crop of authority re-assessing whether, under a variety of federal employment statutes, a jury may be instructed to weigh the trial evidence under a mixed-motive framework, and find liability of an improper reason partly motivated an adverse action, per Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) (plurality opinion). Smith is the strongest decision yet affirming the availability of a mixed-motive theory outside of a straight Title VII discrimination case.
The plaintiff, a former Office Solutions Specialist, alleged that she was given less territory and fewer resources to meet the same goals as male and younger employees, in violation of Title VII and the ADEA. She also presented evidence at trial that shortly after filing a Title VII and ADEA charge with the EEOC, while she was on a performance improvement plan, the company short-cut the probationary process and terminated her, allegedly in retaliation for the charge.
“Smith was terminated in January 2006 at the conclusion of her probationary period, at which point she had achieved approximately 74% of her revenue goals. Smith contends, however, that Jankwoski actually began the termination process much sooner, only days after she filed her EEOC charge, thereby truncating the probationary period in a way contrary to Xerox’s established policies and procedures. For example, the record contains an involuntary termination request form seeking Smith’s termination that appears to follow a fax cover sheet to the human resources department dated November 29, 2005, only seven business days after Smith filed her EEOC complaint.”
The jury returned a verdict in favor of Xerox on the discrimination charge, finding that Xerox had not discriminated against Smith, but also found that the company had retaliated against Smith. “It concluded in a special interrogatory that Smith proved her EEOC charge was a motivating factor in Xerox’s termination decision. It then found that Xerox failed to show it would have made the same termination decision even if it had not considered Smith’s EEOC charge. The jury awarded Smith $67,500 in compensatory damages and $250,000 in exemplary damages.”
Xerox’s principal argument on appeal was that the jury should not have been instructed on the mixed-motive theory. Tha panel majority regards itself on the cusp between Gross, which held that “because of” language in the ADEA did not support a mixed-motive theory, and Price Waterhouse, which recognized such a theory under Title VII before the 1991 Civil Rights Act.
Here, the panel majority sides with Price Waterhouse and affirms the use of a mixed-motive jury charge:
“In other words, the decision before us is how to proceed in light of Price Waterhouse, which specifically provided that the ‘because of’ language in the context of Title VII authorized the mixed-motive framework, and Gross, which decided that the same language in the context of the ADEA meant ‘but-for,’ but also refused to incorporate its prior Title VII decisions as part of the analysis. We believe that under these circumstances, the Price Waterhouse holding remains our guiding light. Although the dissent would extend Gross into the Title VII context, we think that would be contrary to Gross‘s admonition against intermingling interpretations of the two statutory schemes.”
Furthermore, applying Desert Palace, Inc. v. Costa, 539 U.S. 90 (2003), the panel finds that the employee was not required to present “direct evidence” of a retaliatory motive to receive the charge.
The panel majority goes on to reject a challenge to insufficiency of the evidence (in a portion of the opinion that went unpublished), but tosses the punitive damage award as having an insufficient basis in the record. “In light of the competing evidence that impugned Smith’s performance, we cannot say that the evidence supports a finding that Xerox managers acted with malice or reckless indifference to the possibility that her termination could violate federal law. We therefore hold that, although the evidence was sufficient to find that retaliation was a motivating factor in the termination, the punitive damages award based on malice or reckless indifference to federal rights cannot stand. That portion of the district court’s judgment must be vacated.”
Judge Jolly, dissenting, complains that his colleagues create an unnecessary circuit split with the Seventh Circuit, which under Serwatka v. Rockwell Automation, Inc., 591 F.3d 957, 961 (7th Cir. 2010), declared that all federal statutes otherwise lacking specific mixed-motive liability provisions would be deemed to require proof of “but-for” liability. “The ‘because of’ language requires a plaintiff to demonstrate but-for causation. This
is the standard that claimants under Title VII’s retaliation provision must meet in the post-Gross world. There is no reason to dismiss this Supreme Court ruling just to be obstinate or to claim some special exemption for the Fifth Circuit.” He also concludes that, in any event, the facts in this case were not susceptible to mixed-motive analysis and should have been charged as a straight pretext case.
Marsico v. Sears Holding Corp., No. 07-2231 (6th Cir. Mar. 25, 2010): Plaintiff, a former senior vice president, alleged that his removal was part of a youth movement instigated by Edward Lampert, Chairman of the Board, and William Crowley, Senior Vice President of Finance. The panel observes that the plaintiff had accumulated conceivably direct evidence that might fend off summary judgment:
“For instance, Plaintiff contends that ‘upper management, particularly Eddie Lampert, had a bias against older employees.’ (Pl.’s Br. 38.) In support of this contention, Marsico points to [executive] Rod Brumley’s testimony that while discussing the refund-policy sign in one of the Kmart stores, Lampert commented that ‘that’s what’s wrong with these Kmart people, that old way of thinking,’ which Brumley interpreted as an ageist reference to Marsico. (ROA 880.) Lampert also stated that Marsico had ‘been around a long time.’ (ROA 763.) Marsico references Day’s statement that Lampert did not ‘think that someone that’s been around for 30 years [could] fix Kmart’ and Rogers’ comment’that Crowley wanted Marsico ‘gone’ from the company (ROA 770, 796.) Plaintiff contends that the district court improperly denied his motion to compel the depositions of Lampert and Crowley, which Plaintiff says are necessary in order to determine whether these comments were motivated by discriminatory intent.”
But the district court denied plaintiff depositions of the two officers, holding that the comments above, even given their full weight, were too weak to imply age bias. The panel majority opinion (by Judge Cole) disagrees: “No one but Lampert and Crowley can testify as to whether the comments cited by Marsico were motivated by age discrimination as indicated by the context and circumstances in which the comments were made. Plaintiff should have been allowed to elicit such testimony and use it in responding to Defendant’s motion for summary judgment. Accordingly, we conclude that the district court abused its discretion in denying Plaintiff’s motion to compel the depositions and hold that Marsico may depose both Lampert and Crowley.”
Judge Kethledge, dissenting, found no abuse of discretion. “That the new management of a bankrupt company should criticize the company’s ‘old way of thinking[,]’ and express skepticism ‘that someone that’s been around for 30 years can fix Kmart[,]’ does not seem to me so extraordinary as to allow this court, rather than
the district court, to take control of the discovery process.”