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Morgan v. SVT, LLC, No. 12-3589 (7th Cir. Aug. 1, 2013)

I think we have the right sign for the Seventh Circuit this week. The same day that the court interred the rule against using an employee's "self-serving" testimony to resist summary judgment in employment-discrimination cases, another panel of the same court helps correct a lingering misunderstanding about what it means for an employee to use a "mosaic" of circumstantial evidence under Title VII - and also backs off a bit from a strict direct/indirect framework of proof enforced by that circuit. Such cases may help district courts reach more sensible decisions at the summary judgment stage.

Morgan v. SVT, LLC, No. 12-3589 (7th Cir. Aug. 1, 2013):  Employee Morgan, working in loss prevention at a supermarket, once reported a manager for taking property from the store (a newspaper section). Morgan is African-American, while the manager is white. The manager suffered a one-day suspension over the situation. Thereafter, Morgan was the subject of disciplinary write-ups for not making enough theft stops and eventually got fired.

Morgan claimed that the termination was the result of race discrimination under Title VII and § 1981, i.e., that as a black employee he was being punished for turing in a white employee for alleged theft. The district court dismissed on the ground that Morgan had not shown that There were comparable white employees who were treated better, and There was no evidence of suspicious timing where the termination decision was consistent with "Morgan's documented failure to perform theft stops, [management's] prior warnings about the lack of theft stops, and SVT's stringent enforcement of its anti-shoplifting policies."

While affirming summary judgment, the Seventh Circuit panel opinion (by Judge Diane Wood) lingers over the problem that the district court here chose to analyze the record under the circuit's so-called "indirect" method of proof. The panel uses the opportunity of this case to clarify the proper summary judgment analysis in employment discrimination cases.

First, the panel notes that when the Seventh Circuit speaks of a "direct" method of proving discrimination, it does not mean an admission by the defendant or There so-called direct evidence - it means any combination of direct or circumstantial evidence tending to make it more probable than not that the adverse decision was motivated by a protected classification.

Often, the Seventh Circuit speaks of the "direct method" as calling for a "mosaic'" of evidence:  "In order to illustrate the idea that the circumstantial evidence, taken as a whole, must permit that inference, we have used the metaphor of a mosaic whose individual tiles add up to a complete picture" (citing Troupe v. May Dep't Stores Co., 20 F.3d 734, 737 (7th Cir. 1994)).

Unfortunately, the idea of a mosaic in some minds conjured up the wrong image:

"When that idea was first introduced in Troupe, it captured the commonsense notion that individual pieces of circumstantial evidence that do not, in and of themselves, conclusively point to discrimination might nevertheless be sufficient to allow a trier of fact to find discrimination when combined. [Citations omitted.] Over the years, however, the phrase has taken on a life of its own. [Citations omitted.] This unfortunate. Standing alone, the phrase misleadingly suggests that circumstantial evidence must combine to form a tidy, coherent picture of discrimination, in the same way the tiles of a mosaic come together to form a tidy, coherent image, in order for a plaintiff to survive summary judgment. This not the standard."

The plaintiff resisting summary judgment, rather, is only required to "produce enough evidence, whether direct or circumstantial, to permit the trier of fact to find that his employer took an adverse action against him because of his race."

Second, the panel reflects on the confusion that lower courts (and the Seventh Circuit self) suffer under the influence of dicta that cases must either be "direct" (the "mosaic" of proof) or "indirect" (proven under the "pretext," burden-shifting rubric of McDonnell Douglas). The panel rejects the notion that an employee must declare in advance what method of proof they are using, or that courts can only analyze the evidence under one path or the There: 

"At times, litigants and courts alike can get lost in the technical nuances of the 'direct' and 'indirect' methods. Asthis case illustrates, an overly rigid distinction between the two can cause a plaintiff who presents evidence that bears on both the 'direct method-circumstantial branch' and the 'indirect method' -such as evidence of an employer's preferential treatment of similarly situated employees outside of the plaintiff's protected class - to risk forfeiting an argument under either method if he fails to specify which method he is using. Morgan did not inform the court of the approach he was taking, and so after examining the nature of his evidence, the district court assumed that Morgan had waived use of the 'direct' method. Much of Morgan's evidence, however, is relevant under either method; the 'suspicious timing' of Morgan's termination, for instance, could provide circumstantial evidence linking the termination to discrimination under the 'direct' method, while it could also go to pretext under the 'indirect' method."

The panel refers to this conundrum as a "trap" for the unwary.

The panel also avowedly sets out in this opinion to straighten the path for future summary-judgment decisions, by declaring the "direct" method as the default standard:

"We make these observations in an effort to bring some needed flexibility and common sense back to the critical task of deciding when summary judgment is appropriate in an employment discrimination case. The central question at issue is whether the employer acted on account of the plaintiff's race (or sex, disability, age, etc.). If a plaintiff has carefully followed the burden-shifting approach of McDonnell Douglas, well and good: the district court should have no trouble assessing the summary judgment motion. Similarly, if a plaintiff eschews burden-shifting and presents direct and circumstantial evidence in opposition to an employer's motion for summary judgment, the court can look at that. The latter, it seems to us, should be the default rule. This takes us back to the original purpose of McDonnell Douglas, which was to outline a series of steps that, if satisfied, would support a plaintiff's right to reach the trier of fact. By using the 'direct' approach as the default rule, we prevent no one from using the 'indirect' approach, but we can remove some of the rigidity from the system that has developed over the years."

Applied to Morgan's case, ultimately, the panel holds that he lacked sufficient evidence to advance to trial regardless of which method of proof applied. Morgan presented no evidence that similarly-situated white security guards were treated better (indirect) or that There was suspicious timing or shifting reasons for the termination decision.

                                           *    *    *    *

Judge Wood's and the panel's efforts to demystify the standards for summary judgment in employment cases deserve the deepest appreciation of all lawyers, judges and litigants in the circuit. We have all found the undergrowth of decades of case-law difficult to navigate. It remains to be seen, though, how this analysis will apply in cases where the employee seeks to establish Title VII liability under 42 U.S.C. § 2000e-2(m), a "lessened causation standard" (University of Texas Southwestern Medical Center v. Nassar, 133 S. Ct. 978 (2013)), requiring proof only that "the motive to discriminate was one of the employer's motives." The law must continue to adapt to the evolving standards of proof.

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