Michael Alan Gadsby v. Norwalk Furniture Corporation

FLAUM, Circuit Judge,

concurring in the judgment. I concur in the judgment of the court. I write separately because I cannot agree with the majority’s analysis of what constitutes a prima facie ease under McDonnell Douglas and the ADEA.

I.

The majority opinion sets forth the first three requirements of a prima facie age discrimination case as follows:

(1) the employee was a member of the protected class (age 40 or over); (2) the employee was meeting the employer’s legitimate expectations; and (8) the employee was discharged or demoted. These elements are well-established. See Sirvidas v. Commonwealth Edison Co., 60 F.3d 375, 377 (7th Cir.1995); Anderson v. Baxter Healthcare Corp., 13 F.3d 1120, 1122 (7th Cir.1994). As to the fourth factor, the majority notes the various formulations this circuit has employed; however, it determines that it is unnecessary to delineate the exact requisites of the fourth element in a discharge situation in order to resolve this case. Specifically, the majority declines to decide whether the fourth factor is satisfied only by actual replacement (which did not occur here) or *1334 whether a showing that the protected employee was treated less favorably than younger employees is sufficient. The majority concludes that resolution of this issue is unnecessary because it finds that, even under the more permissive formulation, Gadsby’s evidence is insufficient. Hence, the court finds that Gadsby has failed to establish a prima facie case of age discrimination. I respectfully disagree.

It cannot be denied that the first and third elements of the prima facie case are satisfied in this case. Gadsby was 42 years old when he was discharged by Norwalk. In my opinion, Gadsby has also satisfied the second element — that he was meeting Norwalk’s legitimate expectations. 1 As the majority notes, “there is substantial evidence that Norwalk was pleased with Gadsby’s performance until his termination in 1990....” Supra at 1326. Gadsby presents ample objective evidence — in the form of dramatically increased sales, high overall ranking among salespersons, 2 and numerous handwritten compliments from Norwalk management— that he was more than meeting Norwalk’s expectations for the job he was hired to perform, i.e., selling Norwalk furniture to customers in the Chicago area. Norwalk essentially admits this, as it does not claim that sales performance was a reason for Gadsby’s discharge. Consequently, Gadsby’s evidence demonstrates that he was meeting Norwalk’s legitimate expectations.

At this prima facie case stage, Norwalk fails to present any objective, contemporaneous evidence demonstrating Gadsby’s unsatisfactory performance (such as a non-favorable performance review or evaluation), which undermines Gadsby’s substantial evidence of adequate performance. Norwalk simply points to evidence and testimony it has since gathered, which goes to the legitimate reasons — beyond his objective job performance — for which it claims it discharged Gadsby. Norwalk presents three reasons: 1) Gadsby’s rude and abrasive personality, 2) his problems disclosing confidential information, and 3) his deteriorating relations with an important customer (Smithe). Norwalk, however, can raise these explanations once the baton passes to it. Gadsby, in order to establish a prima facie case, should not be forced to anticipate every possible reason his employer could provide for his discharge and incorporate responses to all of these hypothetical reasons into his prima facie case. Interpreting the legitimate expectations prong of the prima facie case this broadly would essentially destroy the burden-shifting feature of McDonnell Douglas, by conflating the employee’s burden of proving satisfaction of legitimate expectations with the employer’s burden of providing a legitimate, non-discriminatoxy reason.

This brings us to the fourth prong of the prima facie case. The majority found that it need not accept or reject Gadsby’s argument that, where the plaintiff could demonstrate that he was treated less favorably than younger employees, a showing of replacement was unnecessary to satisfy the fourth prong. I would accept Gadsby’s argument and hold that, in a non-replacement situation, a showing that the discharged plaintiff was treated less favorably than younger employees is sufficient to satisfy the fourth prong of the prima facie case. As the majority notes, we have sometimes formulated the fourth factor as requiring replacement by a younger person. Supra at 1332. However, we have also recognized the need for flexibility in establishing the requirements of the McDonnell Douglas prima facie case: “The prima facie case ... is a flexible standard that ‘is not intended to be rigidly’ applied.” Collier v. Budd Co., 66 F.3d 886, 890 (7th Cir.1995) (internal citation omitted); Loyd v. Phillips Brothers, Inc., 25 F.3d 518, 522-23 (7th Cir.1994) (rigid adherence to formulaic prescriptions can block proper analysis). The prima facie case, particularly the fourth prong, must be adapted to the differing factual circumstances that give rise to age discrimina *1335 tion claims. See Collier, 66 F.3d at 890 ; Loyd, 25 F.3d at 523 .

For this exact reason, we have held in reduction in force (“RIF”) cases that an employee need not prove replacement, but instead need only show that younger employees were treated more favorably. See Collier, 66 F.3d at 890-91 ; Roper v. Peabody Coal Co., 47 F.3d 925, 926 (7th Cir.1995). This is because when a company reduces its workforce, it generally does not replace the discharged employees, rather positions are often consolidated and work is shifted to other existing employees. Collier, 66 F.3d at 890 ; Oxman v. WLS-TV, 846 F.2d 448, 455 (7th Cir.1988). In this context, we found that:

an employer’s retention of a younger employee either in the same job as the discharged plaintiff or in another job for which the plaintiff also was qualified gives rise to an inference of discrimination that is no weaker than the well-recognized inference created when an employer discharges an employee who is performing adequately and then seeks and/or obtains a [younger] replacement.

Oxman, 846 F.2d at 455 (quoting Matthews v. Allis-Chalmers, 769 F.2d 1215, 1223 (7th Cir.1985) (Flaum, J., concurring)). We therefore held that, in a RIF situation, a showing that younger employees were treated more favorably is enough to create a rebuttable presumption of discrimination sufficient to shift the burden to the employer. Oxman, 846 F.2d at 455 . In essence, we recognized that employees discharged pursuant to a reduction in force cannot raise the inference of discrimination necessary to establish a prima facie case by showing replacement by a younger person, so we afforded them an alternative means.

Gadsby argues, citing our RIF cases, that the “treated less favorably” standard should apply in his situation, since he was not replaced by Norwalk. 3 The majority finds the RIF cases “unpersuasive.” Supra at 1331. However, I see no meaningful reason why the prima facie case in the situation where an employee is discharged and not replaced due to a reduction in force should be different from the situation where an employee is discharged and not replaced for some other reason. In both situations the discharged employee is unable to raise an inference of discrimination by showing replacement by a younger employee, because there is no replacement to consider. In the one person discharge/no replacement situation, the fact that younger employees are treated more favorably raises an inference of discrimination substantially equal to the same inference we recognize in RIF cases (and, which we held in Oxman , is no weaker than the inference raised where the employee is replaced by a younger person.) Therefore, because the same basic considerations are at issue in both situations, I believe logic requires that the elements of the prima facie case be the same. Hence, I would hold that in the situation where an employee is discharged and not replaced, a showing that younger employees were treated more favorably meets the fourth prong of the prima facie ease.

The majority declines to adopt the treated less favorably standard as the general rule for single-discharge cases; however, it does agree that the inference of discrimination might be the same in the situation “where one employee is discharged and his responsibilities are absorbed by other employ-ees_” Supra, at 1332. In the majority’s view, the fact that the discharged employee’s duties were shifted to other employees implies fungibility between the jobs of the discharged employee and the retained younger employee, which is necessary to draw the inference of discrimination. Concluding that the evidence in the instant case fails to show that Gadsby’s duties were absorbed by other salespersons, the majority finds the treated *1336 less favorably standard inapplicable in this case.

I agree with the majority that the inference raised by more favorable treatment of younger employees is premised on some degree of interchangeability between the discharged employee and the younger retained employees. The discharged plaintiff must demonstrate that he was qualified for the positions retained by the younger employees in order to show less favorable treatment. This was the basis for adopting the standard in Oxman. See Oxman, 846 F.2d at 455 (quoted above). Of course a chemist is not qualified for a mechanic position, and therefore could not prove less favorable treatment by showing retention of a younger mechanic. I therefore do not contest the majority’s statement that, in a single discharge case, if the discharged employee and the retained employee are not interchangeable to a certain extent, the inference of discrimination is weak. The same, however, is true in the RIF scenario. Consequently, the majority’s statements, in my view, do not comprise a meaningful reason to reject the treated less favorably standard in single-discharge/no-replacement cases; rather the majority’s comments address whether that standard is satisfied in a particular case.

Turning to Gadsby’s case, I believe that Gadsby has proven the necessary interchangeability between himself and the younger retained employees. First, I question the majority’s apparent view that the only way to prove the necessary fungibility is to demonstrate that the plaintiff’s duties were absorbed by other employees. For instance, if Norwalk no longer needed a Chicago salesperson, Gadsby could prove a degree of fun-gibility by showing he was fully qualified to be the salesperson in Milwaukee. More importantly, however, there is evidence that Gadsby’s responsibilities were shifted to other existing employees. Fred Leach, Nor-walk’s National Sales Manager, testified that members of Norwalk’s management and other existing sales representatives alternated in covering the needs of customers in Gads-by’s territory. Further, Norwalk did not claim as a reason for Gadsby’s termination that a sales representative was no longer necessary for the Chicago area.

Finally, the majority holds that even if the more permissive standard applies, Gadsby’s evidence is inadequate to show he was treated less favorably. However, in my judgment, Gadsby’s evidence is sufficient to support the conclusion that younger, less objectively qualified salespersons were retained. I agree with the majority that comparing Gadsby’s very impressive sales to those of salespersons with different size markets is difficult and not especially helpful on its own in evaluating relative performance among salespersons. However, Gadsby does present direct comparative evidence that in 1990 (the year he was fired), his sales on a month-end, year-to-date basis were consistently up 30 to 40 percent over the previous year, while Norwalk’s 1990 sales from other territories were consistently down 1.5 to 5 percent. This is in addition to the fact that in 1989 (less than a year before he was terminated and the last year the ranking was available) his relative overall ranking among other sales representatives was fourth out of twenty-nine. 4 These facts, combined with Gads-by’s “off the charts” sales amounts in his territory, his dramatic increase in sales over those of his predecessor, his increase in relative performance ranking over the years, and the management compliments he received in 1990, 5 make it a reasonable conclusion that Gadsby was more objectively qualified than the younger retained employees. This is *1337 especially trae since on summary judgment we construe all facts and reasonable inferences in favor of the non-moving party, i.e., Gadsby. See Serfecz v. Jewel Food Stores, 67 F.3d 591, 596 (7th Cir.1995).

Norwalk argues that Gadsby’s evidence is insufficient to show Gadsby was treated less favorably because Gadsby fails to show that younger salespersons with similar customer relations problems, confidential disclosure problems, and abrasive personality problems were treated more favorably. However, for the reasons I discussed in the legitimate expectations context, I find this argument without merit; Gadsby should not be required to anticipate every reason Norwalk could come forward with in order to establish a prima facie case. It is enough that he demonstrates that younger, less objectively qualified individuals were retained, while he was fired. Therefore, in my opinion, Gadsby sufficiently raises an inference of discrimination and adequately meets the “treated less favorably” standard. I would find that Gads-by successfully set forth a prima facie case of age discrimination.

II.

I concur in the judgment of the court, however, because Norwalk has alleged several non-discriminatory reasons for Gadsby’s discharge, and I cannot say that Gadsby has sufficiently shown that all of these reasons are pretexts for age discrimination. Nor-walk has offered three legitimate, non-discriminatory reasons for Gadsby’s discharge: 1) that Gadsby had an abrasive personality and was rude; 2) that Gadsby often disclosed confidential information; and 3) that Gads-by’s relationship with a major customer, Smithe Furniture, was deteriorating. The burden then shifts to Gadsby, who must prove that all of these reasons are pretextual; the employer needs only one legitimate reason to succeed on summary judgment. See Russell v. Acme-Evans Co., 51 F.3d 64, 69 (7th Cir.1995). Gadsby must produce enough evidence from which a reasonable factfinder could infer that Norwalk’s proffered reasons for Gadsby’s termination are false and unworthy of credence. See Sirvidas v. Commonwealth Edison Co., 60 F.3d 375, 378 (7th Cir.1994); Courtney v. Biosound, Inc., 42 F.3d 414, 418 (7th Cir.1994). We need only look to Norwalk’s first reason to see that Gadsby has not met this burden.

Norwalk’s claim that Gadsby was rude and had an abrasive personality is based on two different sets of facts. First, Norwalk’s National Sales Manager, Fred Leach, stated in his deposition that one reason Gadsby was fired was because he had been rude to the president of the company, Ed Gerken. Leach described a particular conversation during which Gadsby interrupted Gerken. Gadsby argues this reason is pretext, not because the incident did not occur, but because it was “inconsequential.” Gadsby emphasizes Ed Gerken’s testimony that he could not independently recall the details of the incident and Leach’s testimony that Gadsby did not raise his voice, swear, or do anything physical during the conversation. Yet Gadsby ignores Gerken’s further testimony that the incident “kind of characterized [Gadsby’s] behavior at market, he frequently would interrupt conversations and barge in, so it would be hard for me to remember any specific time.” Gadsby does not offer a response to this, except to argue that the alleged rudeness was not truly rude and should not have been taken seriously. As we have emphasized in the past, however, the essential question is not whether Gadsby was or was not actually rude and abrasive, but whether Norwalk honestly believed that Gadsby was rude. See Sirvidas, 60 F.3d at 377-78 ; Russell, 51 F.3d at 69 . The fact that Norwalk may have made an incorrect determination or a bad business judgment does not prove that the reason given was a pretext for age discrimination. See Kralman v. Illinois Dept. of Veterans’ Affairs, 23 F.3d 150, 156 (7th Cir.1994). There is undisputed evidence that at least two high level officers at Norwalk, Gerken and Leach, thought Gadsby was rude, and their examples are not so ridiculous that a jury could find their belief incredible. Gadsby’s opinion (or ours) that his conduct should not be considered rude or sufficient to warrant discharge is not enough to rebut this evidence.

Leach also testified that Gadsby’s “abrasive personality” had jeopardized certain ae- *1338 counts and noted that several customers called in to complain about Gadsby. Gadsby again fails to present any evidence that specifically refutes the factual basis that certain customers called and complained about him; he only responds that this reason is pretextual because management had told him to “drop” the accounts, so the accounts were not jeopardized by his personality. Yet even if Gadsby did not endanger these specific accounts (because the accounts were not wanted), the fact that customers complained about Gadsby’s personality is a sufficient basis for management to conclude that Gadsby had an abrasive personality and could jeopardize future accounts. Gadsby presents nothing to refute this and therefore fails to demonstrate a genuine issue of material fact as to whether he was discharged for his rude and abrasive personality.

In sum, because Gadsby has failed to present evidence that refutes Norwalk’s basis for believing Gadsby was rude and abrasive, and because he cannot simply substitute his own judgment for that of Norwalk’s management, a reasonable juror could not conclude that Norwalk’s claim that Gadsby was rude and abrasive is not credible and is simply a pretext for age discrimination. Therefore, I concur in the judgment of the court.

. The majority does not express a view as to whether Gadsby met the legitimate expectations factor, apparently finding it unnecessary in light of its conclusion that the fourth factor could not be satisfied.

. In 1989, the year before his discharge, Gadsby was ranked fourth out of twenty-nine salespersons. The ranking was based on a comparative evaluation of thirteen different categories.

. We note that Gadsby was apparently replaced by a 40-year-old for a short period of time some 18 months after Gadsby was terminated. Gads-by, however, does not make the argument that this "replacement” is sufficient to satisfy the fourth prong of the prima facie case. Apparently, he concedes that the passage of a significant amount of time made the replacement insufficient for prima facie case purposes. He argues only that replacement is unnecessaiy if he can show less favorable treatment. Therefore, for purposes of this analysis, I assume that Gadsby was not replaced.

. The majority gives this evidence no weight because Norwalk claims that it was primarily in 1990 that "Gadsby’s behavior ultimately led to his termination; thus we cannot assume that Gadsby’s ranking would have remained unchanged in 1990.” Supra, at 1332-33. We should not assume, however, that Gadsby’s ranking would have fallen substantially either. In my opinion, the 1989 ranking is sufficiently close in time to Gadsby’s discharge that it should be considered evidence of his relative performance. By completely disregarding the evidence, I believe the majority is inappropriately weighing the evidence on summaiy judgment.

. In 1990 Gadsby received several written compliments from management, including: "FYI! You're # 1 after 1 month. Keeping [sic] popping those stock orders! Great Start Mike.” (Jan., 1990); "Great Start” (Jan., 1990); "Still holding above the # Mike!” (May, 1990).