# Petition — Elliott v. Group Hospital Service, Inc. > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1310%3A1 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition - **Published:** January 1, 1984 - **Citation:** 467 U.S. 1215 ## Text 83-1536 1 MAR 17 1984 No. STEVAS. CLERK IN THE Supreme Court of the United States OCTOBER TERM, 1983 JACK A. ELLIOTT, RICHARD GALEN, ROBERT W. HEFFER, GEORGE D. SPRADLEY, MAX TIPTON and C. DUANE THOMPSON, Petitioners V. GROUP HOSPITAL SERVICE, INC., Respondent PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT ELIor P. TUCKER MICHAEL H. GOTTESMAN MANDELL & WRIGHT (Counsei of Record) 21st Floor ROBERT M. WEINBERG 806 Main St. PETER O. SHINEVAR Houston, TX 77002 BREDHOFF & KAISER Curis DNR 1000 Connecticut Ave., N.W. Suite 388 Washington, D.C. 20036 3808 Main St. (202) 833-9840 Houston, TX 77002 WILSON - Eras Printing Co., Inc. - 789-0096 - WASHINGTON. D.C. 20001 o <> ~ QUESTIONS PRESENTED 1. Whether, in an employment discrimination case, the testimony of an employer official that the challenged employment decision was prompted by a non-discrimina- tory reason must be accepted absent “countervailing evi- dence that it was not the real reason for the discharge.” (Stated otherwise, whether, in an employment discrimi- nation case, the fact-finder (here the jury) is permitted to reject the uncontradicted testimony of an interested employer witness on the basis of its assessment that the witness is not credible. ) 2. Whether, in an age discrimination case, evidence that an employer has dismissed a number of highly qualified older employees and replaced them with much younger employees may be considered by the fact-finder, in the absence of a showing that as a matter of probability the pattern is “statistically significant.” 3. Whether, in an employment discrimination case, where the plaintiff has introduced evidence establishing a prima facie case and an official of the defendant em- ployer testifies to a facially-rational non-discriminatory reason for the challenged employment decision, the plain- tiff bears a “heavy burden” of proof that the proffered reason is pretextual. (i) TABLE OF CONTENTS QUESTIONS PRESENTED .................-.-:---0-c-seserenensnensees 3133333 JURISDICTION . . STATEMENT OF THE CASE Rulings in the District Court The Court of Appeals’ Decision REASONS FOR GRANTING THE WRIT . ͥ CONCLUSION — — —ůů . (iii) la iv TABLE OF AUTHORITIES Cases Page Carter v. Duncan-Huggins, Ltd., —— F.2d ——, 84 FEP Cases 25 (D.C. Cir. 1984) 18, 17-18, 25-26 Castenada v. Partida, 480 U.S. 482 (1977) ............. 23 Chesapeake & O. R. Co. v. Martin, 288 U.S. 209 1 ———— TTT 16-17 Dickinson v. United States, 846 U.S. 889 (1953) 16 Hays v. Republic Steel Corp., 581 F.2d 1307 (5th r T 10 Hazelwood School District v. United States, 433 c 23 Inmates of Nebraska Penal, Etc. v. Greenholtz, 567 F.2d 1868 (8th Cir. 1977), cert. denied, 439 U.S. c rec eer eee aD 18, 27-28 Jay Edwards, Inc. v. New England Toyota Dis- tributor, 708 F.2d 814 (Ist Cir.), cert. denied, . e eres 25 Labor Board v. Walton Mfg. Co., 369 U.S. 404 rr ( teadnstimesmiannss 18, 14-17, 19 Marsh v. Eaton Corp., 689 F.2d 328 (6th Cir. rr / ! 18, 25-26 McDonnell Douglas Corp. v. Green, 411 U.S. 792 // / chit edie neat tee 20 NLRB v. Camco, Inc., 340 F.2d 808 (5th Cir. TP— A ata. 25 Pullman-Standard v. Swint, 456 U.S. 278 (1982).. 28 Sonnentheil v. Christian Morlein Brewing Co., 172 ft PR Re EOE AP ee Saas. 16 Teamsters v. United States, 481 U.S. 824 (1977) ... 20 Texas Dept. of Community Affairs v. Burdine, 450 IN 2¹ U.S. Postal Service Bd. of Governors v. Aikens, — U.S. ——, 108 S.Ct. 1478 (1983) 14, 18, 21, 29 Universal Camera Corp. v. Labor Board, 340 U.S. Kr 19 Westinghouse Electric Corp. v. Vaughan, No. 82 2042, cert. gr., October 17, 1988 14 Statutes Age Discrimination in Employment Act, 29 U.S.C. § 621 et seq. .... passim * TABLE OF AUTHORITIES—Continued Page Section 4(a) (1), 29 U.S.C. § 623 (a) (1) ......... 2 Section 12 (a), 29 U.S.C. § 631 (a) 2 Civil Rights Act of 1866, 42 U.S. C. § 1981 17 Judiciary Act, 28 U.S.C. § 1254(1) .......................-. 2 Miscellaneous Mezines, Stein & Gruff, Administrative Law EE 16, 17 _ IN THE Supreme Court of the United States OCTOBER TERM, 1983 No. — JACK A. ELLIOTT, RICHARD GALEN, ROBERT W. HEFFER, GEORGE D. SPRADLEY, MAX TIPTON and C. DUANE THOMPSON, . Petitioners GrouP HOsPITAL SERVICE, INC., Respondent PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT Jack A. Elliott, Richard Galen, Robert W. Heffer, George D. Spradley, C. Duane Thompson, and Max Tip- ton respectfully petition this Court to review the judg- ment of the United States Court of Appeals for the Fifth Circuit entered in this proceeding on September 16, 1983. OPINIONS BELOW The opinion of the United States Court of Appeals for the Fifth Circuit, reported at 714 F.2d 556, is reprinted in the Appendix (hereinafter “App”) at la-22a. The or- der denying rehearing and rehearing en banc is unre- ported, and is reprinted at App. 23a. The judgment of the United States District Court for the Southern Dis- trict of Texas, entered following a jury verdict, is unre- ported, and is reprinted at App. 24a-27a. The orders of the District Court denying respondent’s motions for judg- ment n.o.v. and new trial are unreported, and are re- printed at App. 28a-29a. JURISDICTION The judgment of the Court of Appeals for the Fifth Circuit was entered on September 16, 1983. A timely pe- tition for rehearing was denied on November 25, 1983. On February 14, 1984, Justice White signed an order ex- tending the time for filing a petition for a writ of certi- orari to and including March 17, 1984 (App. 30a). This Court has jurisdiction pursuant to 28 U.S.C. § 1254(1). STATUTE INVOLVED The pertinent provisions of the Age Discrimination in Employment Act, 29 U.S.C. §§ 621 et seg., are as follows: Section 4(a) (1), 29 U.S.C. § 623 (a) (1): It shall be unlawful for an employer— (1) to fail or refuse to hire or to discharge any individual or otherwise discriminate against any in- dividual with respect to his compensation, terms, con- ditions, or privileges of employment, because of such individual’s age. Section 12 (a), 29 U.S.C. § 681 (a): The prohibitions in this chapter shall be limited to individuals who are at least 40 years of age but less than 70 years of age. STATEMENT OF THE CASE In this action under the Age Discrimination in Employ- ment Act (“ADEA”), 29 U.S.C. §621 et seg., the jury, after a five-day trial, returned a verdict for the plain- tiffs (petitioners), but the Court of Appeals overturned that verdict. In this posture, the evidence must be viewed in the light most favorable to petitioners, and our state- ment proceeds accordingly. Respondent is an insurance company, doing business as Blue Cross-Blue Shield of Texas (App. 8a). Petitioners all were, until the terminations giving rise to this law- suit, executives in respondert’s Marketing Division (App. 4a). In April, 1978, Walter Hachmeister was promoted to the position of president-elect of respondent (App. 3 8a). Hachmeister announced that he wanted “new blood” in the Marketing Division (App. 17a) and that “my people are going to have to be lean and mean” (App. 17a; Tr. 1058, 606-607). Within a five-month period, an unprecedented shake-up of incumbent executives oc- curred within the Marketing Division, with older execu- tives (including the six petitioners) terminated, and younger men, who had been their subordinates, moved up to replace them. Ten executives were fired, all above the age of 40 and thus within the age group protected by the ADEA. Six (the six peti.ioners herein) were replaced. Each was re- placed by a younger man. Five of the six replacements were under 40. The average age of the petitioners was 49.5, thirteen years older than the average age of their replacements, 36.5 (App. 17a-18a). Of the ten terminations, eight were from top executive positions within the Division. The following table, de- rived from P. Ex. 141-A, lists the incumbents in the top executive levels of the Marketing Division, showing the ages of those who were terminated and those who were kept: Position Name Age Terminated Vice Presideat Eller 48 x Assistant V.P. Galen 49 x Owens 89 Reg. Sales Mgr. Tipton 56 X Elliott 50 X M. Owens 45 x Lutz 44 x Bagwell 43 David 42 Slack 88 Mgr. / Director Shivers 61 Spradley 58 X Thompson 48 x Pace 87 Ricks 29 4 As the table reflects, the oldest of the two Assistant Vice Presidents was terminated, as were the four oldest of the seven Regional Sales Managers, and, with one exception, the oldest of the Manager/Directors. Additionally, at the district manager level (not shown on the table), there were two terminations, both of persons over the age of 40. (App. 18a, n.12). No one below the age of 41 was terminated. (Id.). Each of the petitioners was a long-term employee of respondent, all but two having at least 20 years of service (Tr. 10, 302, 353, 494). Each was terminated without prior notice or discussion, and (except in the case of peti- tioner Tipton) without being given any reason for the termination other than that there was to be a “new team” and the petitioner would not be on it (Tr. 28, 77-78, 218-20, 295-96, 352-54, 422-24). None of the pe- titioners (again except Tipton) was offered continued employment in another capacity (Tr. 997-998). Respondent had a comprehensive evaluation system, un- der which each executive was annually rated in a variety of categories by higher management and on the basis of that evaluation was assigned an overall rating of Mar- ginal, Adequate, Competent, Superior or Distinguished. (P. Ex. 9). At the time of their termination, two of the petitioners (Heffer and Tipton) were rated “Distin- guished,” a rating reserved for that “small percentage of employees” who are “truly outstanding” and combine “extraordinary accomplishments” with “brilliance” (Tr. 233, 488; P. Ex. 9, p. C-10). Three of the petitioners (Galen, Elliott and Spradley) were rated “Superior,” a rating “reserved for the unusually effective employee” whose performance is “above what is normally expected” 1 Petitioner Thompson had 18 years of service, and petitioner Heffer 11 years of service (Tr. 221, 411). 2 Alone of the petitioners, Tipton allegedly was discharged for “cause” (Tr. 997). Ironically (given that allegation), Tipton was the only petitioner offered continued employment in another ca- pacity (Tr. 998). 5 (Tr. 14, 298-99, 348; P. Ex. 9, p. C-10). The sixth peti- tioner (Thompson) was rated “Competent,” meaning that he [meets the full job requirements satisfactorily with some unusually effective performance. . [and] is defi- nitely satisfactory on the present job” (Tr. 416; P. Ex. 9, p. C-9). Four of the petitioners had managerial authority over sales, and each of these four was assigned a sales quota by top-management at the outset of each year. Meeting that quota was, according to respondent’s witness (Tr. 978-979), the principal responsibility for these executives. Each of the four had exceeded the assigned quota in each of the two years preceding his termination, in some in- stances by as much as 200% to 400%, and three of the four had exceeded quota consistently for years before as well (Tr. 18-19, 242-43, 252, 299, 489-90). Respondent’s evidence as to the reasons for the termi- nations consisted of the testimony of its officials who par- ticipated in the termination decisions: According to respondent’s testimony, “the reason for Galen’s discharge was a perceived disloyalty because he had sought to undercut his immediate superior, approach- ing Hachmeister with a ‘resumé’ of things to be accom- plished were he to succeed that superior” (App. 19a). Galen, a 20-year employee rated “Superior,” testified that he had approached Hachmeister because he had heard ru- mors that his superior was leaving, and that he told Hachmeister he would like to be considered for the posi- tion if the rumors were true but that he was not seeking to displace the incumbent if the latter wished to remain (Tr. 96). Respondent did not dispute Galen’s version of his conversation with Hachmeister (Tr. 976). Galen, who was 49, was replaced by the youngest of his seven im- mediate subordinates, Tom Slack, who was 33 (Tr. 27; supra, p. 3). Elliott was terminated, according to respondent’s wit- nesses, “because his region had not achieved the com- pany’s desired market penetration or productivity, the un- 6 disputed fact being that the market penetration there (in Houston) was approximately five to six percent, as com- pared to the company’s state-wide market penetration of twenty percent” (App. 19a). Elliott, a 20-year employee rated “Superior,” testified, and also submitted documen- tary evidence proving, that top management set sales quotas for Houston reflecting what respondent thought attainable in the competitive Houston market, quotas that Elliott had met and exceeded (Tr. 299). Elliott, who was 50, was replaced by the promotion of Royce Barron, age 33, from a lower-level position (Tr. 40; P. Ex. 141-A). Tipton was terminated, according to respondent’s wit- nesses, because “he had violated company policy by having a contractor who was remodeling his new regional offices leave out a wall, producing the twin effect of enlarging his personal office beyond the square footage permitted by the company for an officer of his rank and eliminating the employees’ lounge” (App. 19a-20a). Tipton, a 20-year employee rated “Distinguished,” testified that he had re- ceived authorization from his superior to leave out the wall pending approval at a higher corporate level (Tr. 480)—authorization that the superior confirmed in his testimony (Tr. 129). Because the authorization was con- tingent, Tipton had made arrangements with the contrac- tor that the wall would be installed on two hours’ notice at no extra charge should that course become necessary (Tr. 483-84)—an arrangement that was known by re- spondent’s officials at the time they decided to terminate Tipton (Tr. 483-84, 783-84). Tipton, who was 56, was replaced by Larry Bagwell, who was 43 (Tr. 4). 782). Tipton had been told by top management only weeks be- fore his termination that his record was superior to Bagwell’s (Tr. 500-501). Alone of the petitioners, Tip- ton was offered continued employment in a lower-level capacity (Tr. 998). Heffer was terminated, according to respondent’s wit- nesses, for “inability to work with others” (Tr. 594). 7 According to these witnesses, Heffer had trouble keeping salesmen because of his personality (Tr. 767), and his new superior (the 33-year-old Barron, who replaced peti- tioner Elliott), had derived a perception from his brief contacts with Heffer that Heffer resented Barron’s promo- tion and that they would not be able to work together as a “team” (Tr. 683-84, 689). Heffer, an 11-year employee rated “Distinguished,” testified that the only reason sales- men left was that the company’s salaries for salesmen were not competitive in the Houston area (Tr. 247)—a fact confirmed in written company documents“. Three salesmen who had worked under Heffer testified that Heffer had a great attitude and salesmen loved working for him (Tr. 1011, 1017, 1035), and Heffer’s written evaluations gave him the highest-possible ratings in man- agement of subordinates (P. Ex. 3, Nov. 1, 1977, per- formance appraisal). As for Barron’s perceptions, Heffer testified that they had met only twice since Barron’s pro- motion, that he (Heffer) had done nothing to communi- cate resentment of Barron’s promotion, and that in fact he had not resented it (Tr. 1043-44). One of respondent’s own witnesses testified that Heffer had always had a good attitude and he was “surprised” when he learned that Heffer had been terminated (Tr. 812-14). Heffer, who was 41, was replaced through the promotion of Mike Mc- Guire, six years his junior, who was moved up from man- aging a smaller office (Tr. 40, 268-69). Spradley was terminated, according to respondent’s wit- nesses, because he “lacked the personality to deal with others in management positions and had demonstrated that he did not have the capabilities or desire to be Man- ager of National Accounts” (App. 19a). Respondent’s witness conceded on cross-examination that Spradley had received an “adjustment raise” three months prior to his termination, and that respondent’s practice is that “if an employee’s performance is not satisfactory he does not Wo are not economically competitive in our salary program with the Houston employment market” (P. Ex. 1, Dec. 22, 1977 performance appraisal). receive an adjustment raise“ (Tr. 579). Spradley, who was age 53 and a 30-year employee, was rated “Superior” (Tr. 41, 348, 353). He was replaced though promotion of Pat Patrick, age 39 (Tr. 354-55) .* Thompson, according to respondent’s witnesses, was dis- missed because he had “neglected” the sales training pro- gram that was his primary responsibility (App. 19a). Thompson, who was an 18-year employee and rated “Com- petent,” testified that the program was in fine shape until the year preceding his termination, at which point he had been pulled away for several months to perform special projects at the request of the company president; that in consequence the program needed updating; that at the time he was terminated he had completed a memorandum outlining the steps needed to update the program; and that the revised program prepared by his successor was substantially along the lines he had proposed (Tr. 419-20, 437-39, 457-63). A number of witnesses called by peti- tioners testified that the sales training program had been effective up to the point Thompson was diverted by the special assignments (Tr. 249-50, 310, 1012-13, 1018-19, 1029-31) ; respondent’s witness testified that Thompson had “given good performance” but not “what 1 considered top-flight performance” (Tr. 939). Thompson, who was 48, was replaced by Ed Hulsey, age 36 (Tr. 41). * The opinion below states (App. 19a) : The record reflects that during the three years preceding Spradley’s termination he had been transferred into and out of a total of four different positions, with the final transfer, Manager of National Accounts, being a decided demotion. The record shows that the first three positions were special assign- ments heading short-term projects at the request of the company president (Tr. 341-44), and that Spradiey’s transfer to Manager of National Accounts (the only point that he suffered a reduction in pay) was voluntary and at Spradley's request, because the work was in his area of expertise and thus more to his liking (Tr. 344 (Spradiey) ; Tr. 827 (respondent's witness) ). 9 Respondent called an expert witness in statistics. The expert was told nothing about the incumbents of the top jobs in the Marketing Division except their ages and the positions they held. He was asked to testify to the probability that in a random termination of eight incum- bents from that group all eight would be age 40 or over.“ The expert testified that the probability of this phenome- non occurring randomly was .0643, or approximately one in sixteen. The expert further testified that it is a con- vention in statistics to treat only probabilities of five per- cent or less (approximately two standard deviations) as statistically significant, and as the probability here was over six percent there was not by that convention a sta- tistically significant correlation between age and the phe- nomenon that had occurred (D. Ex. 34, Chart E; Tr. 865- 67, 880). On cross-examination, the expert acknowledged that his analysis took no account of the ages of those who replaced the terminatees, and thus reflected nothing as to the probability of the random occurrence of both eight terminatees all being over 40 and their replacements being substantially vounger (Tr. 883). Rulings in the District Court The district court denied respondent’s motion, made at the close of petitioners’ case-in-chief, to dismiss under Rule 41(b) on the ground that petitioners “had failed to establish a prima facie case” (App. 6a). At the close of all the evidence, the district court denied a renewed mo- tion of the same effect (App. 7a, n. 7; 8a). The district court instructed the jury that to prevail each petitioner had to prove “that age was a determining factor” in his termination, i e., that “the employer would not have acted as he did but for the employee’s age” The expert's analysis did not embrace the district sales man- ager positions, which had yielded two additional terminations, both of persons over 40. See n. 14, infra. TS. 10 (R. 78, p. 6). The jury returned a verdict in favor of each of the petitioners (App. 24a-25a).* The district court denied respondent’s motion for judg- ment n. o. v., b] ecause the Court holds that the evidence presented at trial of this case was of such quality and weight that reasonable and fair-minded persons in the ex- ercise of impartial judgment might reach different con- clusions” (App. 28a). Final judgment was entered on the jury verdict (App. 24a-27a), and respondent’s mo- tion for a new trial was denied (App. 29a). The Court of Appeals’ Decision The court of appeals reversed, holding that “the evi- dence was insufficient to support the jury’s finding of age discrimination” (App. 22a). The court acknowledged that at least five of the six petitioners had established a prima facie case of age discrimination, i.e., that each had shown that he was qualified for the position he held, that he was discharged, that he was within the class protected by the ADEA (ages 40-70), and that he was replaced by someone younger (App. 16a-27a, 20a).’ But, the court *The jury also found that the discharge of each plaintiff was “willful” (App. 25a). Despite that finding, the district court re- fused to award the liquidated damages provided in 29 U.S.C. § 626(b) for “willful” violations of the ADEA, declaring that it was exercising the “discretion” that the Fifth Circuit has allowed to district courts in that regard (App. 26a, citing Hays v. Republic Steel Corp., 531 F.2d 1807 (5th Cir. 1976)). Petitioners cross- appealed, contending that, as other circuits have held, liquidated damages for “willful” violations are mandatory under the ADEA (App. 2a-8a, n. 2). The court of appeals declined to decide this issue, in light of its overturning of the violation finding (id.; see also App. 22a). This remedy issue would, of course, remain for decision by the court of appeals upon remand were this Court to grant certiorari and reverse the decision below as to the merits. The court of appeals noted that the parties were in dispute as to whether the sixth petitioner, Spradliey, had shown he was quali- fied to perform his job (App. 17a), and did not expressly state its view on whether Zpradley had established a prima facie case. Given the undisputed testimony that three months before his ter- mination Spradley received a raise that goes only to those whose 11 noted, witnesses for respondent had testified to a reason other than age for terminating each (App. 19a-20a), and “i]t cannot be said that any of these reasons is irra- tional or idiosyncratic” (App. 20a). The court then de- clared: Once such a reason for discharge is articulated by adequate evidence, the plaintiff’s established prima facie case is not necessarily sufficient to take the case to the jury. [Jd.] The court reasoned that when a plaintiff presents “no more evidence of discrimination” than that necessary to establish a prima facie case, and the defendant presents evidence justifying and explaining the discharge, the trier of fact is not free to disregard that explanation without countervailing evidence that it was not the real reason for the dis- charge. IId.] The court stated further: [W]here, as here, the reasons articulated are ra- tional ones, the objective truth of which is not seri- ously disputed, the burden of establishing them as pretextual is a heavy one indeed. [App. 22a]. The court explained what evidence might meet that heavy burden: [PJerhaps a successful statistical demonstration by expert testimony, perhaps proof that others similarly situated were not discharged. [Jd.] That heavy burden was not met here: Such proof is lacking here; and as to this, the verdict lacks rational support in the record. Since it does, and since the element of pretext was critical, the ver- dict cannot stand. [/d.] In arriving at this point, the court below dismissed as without probative force petitioners’ showing that their terminations were part of an unprecedented “purge[]” (App. 4a) — initiated by a new president’s call for “new performance is adjudged satisfactory (see pp. 7-8, supra), it seems clear that the jury could have found Spradley qualified to perform his job. 12 blood” and “lean and mean” executives—in which ten older executives were terminated and replaced by persons on average 13 years younger. The court reasoned that the testimony of respondent’s expert that “the probability that age was not a factor was . . 6.43 percent” meant that “age could neither be ruled in nor ruled out statistically as the factor leading to the discharges” (App. 18a and n. 12); as “the statistical evidence was equivocal,” rea- sonable jurors” could not “properly have concluded“ that the pattern of discharges was probative of discriminatory intent (App. 20a). Indeed, “it appears that the statistical evaluation undercuts the theory that age was a deter- mining factor in any of the employment decisions” (App. 18a, n. 12).“ REASONS FOR GRANTING THE WRIT The court below was able to conclude that “the evidence was insufficient to support the jury’s finding of age dis- crimination” (App. 22a) only because it had made a num- ber of legal rulings depriving the evidence presented by plaintiffs of its natural probative force. Each of these rulings has significant implications for the trial and res- olution of employment discrimination cases generally. First, the court ruled that although a plaintiff has es- tablished a prima facie case of employment discrimina- tion, if an official of the defendant testifies that a non- discriminatory reason motivated the challenged employ- * Petitioners had introduced substantial evidence rebutting the factual accuracy of the reasons advanced in the testimony of respondent’s witnesses (see pp. 5-8, supra). That testimony was detailed in petitioners’ brief below, and the opinion of the court of appeals implicitly reflects (albeit disparagingly) its awareness of that evidence: “none [of the petitioners] seriously disputed either his awareness of or the objective truth of the company’s stated ground of dissatisfaction with him” (App. 20a, emphasis moved); “each appellee advanced little if anything more than his belief that age caused his discharge” (App. 21a, emphasis added); “here, the reasons articulated [by respondent’s witnesses) are rational ones, the objective truth of which is not seriously dis- puted” (App. 22a, emphasis added). 13 ment decision, “the trier of fact is not free to disregard that explanation without countervailing evidence that it was not the real reason for the discharge” (App. 20a). This rule deprives the jury of the power to discredit the defendant’s witness’ testimony based on the witness’ de- meanor, the imprecision of the witness’ testimony, or the improbability of the witness’ explanations in light of other circumstances in the case. The rule adopted by the court below is in conflict with this Court’s decision in Labor Board v. Walton Mfg. Co., 369 U.S. 404 (1962) (striking down the identical rule when applied by the Fifth Circuit in the context of anti-union motivation under the NLRA), and is in direct conflict with a recent decision of another circuit, Carter v. Duncan-Huggins, Ltd., —— F.2d ——, 34 FEP Cases 25, 31 (D.C. Cir. 1984). Second, the court found that each plaintiff’s case had to be considered as if that plaintiff were the only older em- ployee that was fired, without regard to the evidence that ten highly qualified senior employees were fired and re- placed by significantly younger persons. The court ruled that such evidence was not probative because this pattern of conduct was not shown to be “statistically significant” (App. 18a and n. 12, 20a). This ruling is in direct con- flict with the decision of the Sixth Circuit in Marsh v. Eaton Corp., 639 F.2d 328 (6th Cir. 1981), and the decision of the District of Columbia Circuit in Carter v. Duncan-Huggins, supra. The court’s ruling also pro- vided that statistical evidence of probability levels that are not standing alone satistically significant may not be considered by the fact-finder in conjunction with other evidence of discriminatory intent. That aspect of the court’s ruling is in conflict with Inmates of Nebraska Penal, Etc. v. Greenholtz, 567 F.2d 1868, 1879 (8th Cir. 1977), cert. denied, 489 U.S. 841 (1978). Third, the court ruled that where an employer’s wit- nesses testify that non-discriminatory reasons motivated 14 the challenged employment decision, and those reasons are “rational ones, the objective truth of which is not seri- ously disputed, the burden of establishing them as pre- textual is a heavy one indeed” (App. 22a). This “heavy burden,” which has no analogue elsewhere in the law, is inconsistent with this Court’s recent declaration that the factual question of employer motivation is to be decided “just as district courts decide disputed questions of fact in other civil litigation.” U.S. Postal Service Bd. of Gov- ernors v. Aikens, —— U.S. ——, 103 S. Ct. 1478, 1482 (1983). As we discuss below, each of these issues merits this Court’s plenary consideration.“ 1. The court below has held that notwithstanding the plaintiffs’ establishment of a prima facie case, “the trier of fact is not free to disregard” the facially reasonable explanation proffered in the employer’s otherwise uncor- roborated oral testimony “without countervailing evidence that it was not the real reason for the discharge” (App. 20a). That rule is identical to the rule that same court had followed in anti-union motivation cases under the National Labor Relations Act—until the rule was struck down by this Court in Labor Board v. Walton Mfg. Co., 369 U.S. 404 (1962). As quoted by this Court in Wal- ton, the Fifth Circuit’s rule in NLRA cases was as follows: o This Court has granted certiorari in Westinghouse Electric Corp. v. Vaughn, No. 82-2042, cert. gr. Oct. 17, 1988, a case in which the petitioner-employer asks this Court to impose certain limita- tions upon the fact-finder’s freedom in evaluating evidence of discriminatory motivation. Brief for the Petitioners in No. 82- 2042, p. i, Questions Presented 1 and 2. The issues raised in Vaughn are similar to, but not the same as, the first issue raised herein. The resolution of Vaughn is not likely to resolve the first issue presented in the instant case, and it cannot resolve the re- maining issues presented in this case. Accordingly, we urge that certiorari be granted in this case without awaiting disposition of Vaughn. 15 [T]he controlling and ultimate fact question is the true reason which governed the very person who dis- charged or refused to reemploy in each instance. [T]he discharger knows the real cause of discharge, it is a fact to which he may swear. If he says it was not union membership or activity, but something else which in fact oxisted as a ground, his oath cannot he disregarded because of suspicion that he may be lying. There must be impeachment of him, or sub- stantial contradiction, or if circumstances raise doubts, they must be inconsistent with the positive sworn evidence on the exact point. [369 U.S. at 406- 407.] This Court in Walton struck down the rule just quoted, explaining its vice in terms that are equally applicable to this case: The test in the [Fifth Circuit’s opinion! . . is that the employer’s statement under oath must be believed unless there is “impeachment of him” or “substantial contradiction,” or if there are “circumstances” that “raise doubts” they must be “inconsistent with the positive sworn evidence on the exact point.” But the Examiner—the one whose appraisal of the testimony was discredited by the Court of Appeals—sees the witnesses and hears them testify, While . . the re- viewing court look[s] only at cold records. As we said in the Universal Camera case: . . . The findings of the examiner are to be considered along with the consistency and in- herent probability of testimony. The significance of his report, of course, depends largely on the importance of credibility in the particular case. 340 U.S. at 496. For the demeanor of a witness ... may satisfy the tribunal, not only that the witness’ testimony is not true, but that the truth is the opposite of his story; for the denial of one, who has a motive to deny, may be uttered with such hesitation, discomfort, arrogance or defiance, as to give assurance that he is fabricat- 2 * 16 ing, and that, if he is, there is no alternative but to assume the truth of what he denies.“ Dyer v. MacDougall, 201 F.2d 265, 269. [Walton, 369 U.S. at 407-408.] ” 10 The holding in Walton reflects a long-standing principle, ear- lier applied in Sonnentheil v. Christian Morlein Brewing Co., 172 U.S. 401 (1899). The issue in Sonnentheil was the propriety of submitting to the jury the question whether creditors accepting a deed of trust had knowlege at the time of acceptance that the deed was fraudulent, despite their uncontradicted testimony that they had no such knowledge. This Court held the matter was properly submitted to the jury: [The witnesses] were all apparently interested in sustaining the deed, and in denying all knowledge of a fraudulent intent, and while the jury has no right to arbitrarily disregard the positive testimony of unimpeached and uncontradicted wit- nesses .. the very courts that lay down this rule qualify it by saying the mere fact that the witness is interested in the result of the suit is deemed sufficient to require the credibiilty of his testimony to be submitted to the jury as a question of fact. [172 U.S. at 408.] Justice Frankfurter, dissenting in Walton, declared that the hold- ing was inconsistent with two prior decisions of the Court (869 U.S. at 419-20), and some commentators, in consequence, have sug- gested that “(t]he Supreme Court seems to be on both sides of the question.” Mezines, Stein & Gruff, Administrative Law, § 51.02 at pp. 51-34 to 51-85 (1988). In fact, however, the decisions cited by Justice Frankfurter are rcadily distinguishable. In Dickinson v. United States, 846 U.S. 389, 395-897 (1963), the Court held that a draft board could not deny a registrant exemption from military service as a “regular or duly ordained minister” by disbelieving the registrant’s unimpeached and uncontradicted “testimonial and doc- umentary evidence” that he was engaged full-time as a minister. The case is distinguishable first, because the testimony was cor- roborated by documentary evidence, and second, because the evi- dence related not to the witness’ state of mind (a fact as to which there can be no other direct evidence) but to whether he func- tioned as a minister on a full-time basis (a fact which is sus- ceptible to independent verification). The Court noted in this respect that the local boards may call on the investigative agen- cies of the federal government” (346 U.S. at 397). Similarly, Chesapeake & O. R. Co. v. Martin, 288 U.S. 209 (1981), noted, but refused to apply, the “numerous expressions . . . to be found in the decisions to the effect that the credibility of an interested witness 17 In the light of Walton, the principle that “uncontra- dicted testimony may be disbelieved solely on the basis of the factfinder’s determination of credibility” is pre- dominant among the circuits,” Mezines, Stein & Gruff, Administrative Law, § 51.02 at p. 51-35 (1983) (citing cases). Most recently, in an employment discrimination ease under 42 U.S.C. § 1981 decided in February, 1984, the District of Columbia Circuit adopted this principle, in a decision that conflicts squarely with that of the court below. Carter v. Duncan-Huggins, Ltd., —— F.2d ——, 34 FEP Cases 25, 31 (D.C. Cir. 1984) : . . . Duncan-Huggins offered business reasons for some of its actions .... The Company now appears to argue that its mere articulation of any putatively legitimate business rationale requires the court to take the case from the jury. We reject that argu- ment. . Duncan-Huggins’ alleged justifications for the disparate treatment were presented through the testimony of past or current employees, officers, or owners. For the most part, the only evidence of in- tent was oral testimony; the explanations were with- out support of extrinsic evidence... The weight to be given to these offered business justifications thus required an evaluation of witness credibility. And an evaluation of witness credibility is the ex- clusive function of the jury. Indeed, where the only evidence of intent is oral testimony, a jury could al- ways choose to discredit the proffered explanation. As we stated in Metrocare v. Washington Metropoli- tan Area Transit Authority, 679 F.2d [922] at 926- 27 [D.C. Cir. 1982]: “The jury, whose province it was, could disbelieve the . . . supervisors’ testimonial always must be submitted to the jury, and that that body is at liberty to reject his testimony upon the sole ground of his interest” (id. at 216), because the fact at issue was “the time reasonably necessary for completion of delivery to the Bowman warehouse after the receipt of the shipment at petitioner’s yards” (id. at 215), and the witness’ testimony on this point “was not controverted by proof or circumstance, directly or inferentially; and it is difficult to see why, if inaccurate, it readily could not have been shown to be ao” (id. at 216). 18 explanation of why they acted against the [employee] . . and thus could find their asserted justifications to be pretextual.” Because the strength of the pur- ported business reasons—and indeed the strength of the Company’s case—was thus inextricably inter- related to questions of witness credibility, the case had to go to the jury. Resolution of this circuit conflict is particularly impor- tant to the future litigation of employment discrimination cases. This Court observed recently, in U.S. Postal Service Bd. of Governors v. Aikens, —— U.S. ——, 108 S. Ct. 1478, 1482-88 (1983) ; All courts have recognized that the question fac- ing triers of fact in discrimination cases is both sensitive and difficult. The prohibitions against dis- crimination contained in the Civil Rights Act of 1964 reflect an important national policy. There will sel- dom be “eyewitness” testimony as to the employer’s mental processes. But none of this means that trial courts or reviewing courts should treat discrimina- tion differently from other ultimate questions of fact. ... The law often obliges finders of fact to inquire into a person’s state of mind. As Lord Justice Bowen said in treating this problem in an action for mis- representation nearly a century ago: “The state of a man’s mind is as much a fact as the state of his digestion. It is true that it is very difficult to prove what the state of a man’s mind at a particular time is, but if it can be as- certained it is as much [a] fact as anything else.” Eddington v. Fitzmaurice, 29 Ch. Div. 459, 483 (1885). When the person whose state of mind is at issue takes the witness stand, his credibility is likely to be central to the resolution of the case. To require, as the court below has done (App. 20a), that that person’s testimony that an innocent reason motivated an employment decision must be credited in the absence of “countervailing evi- dence that it was not the real reason for the discharge” 19 is to usurp the fact-finder’s function on the central fac- tual issue in the case. As Walton recognized, the witness’ demeanor may be critical to assessing the credibility of his testimony." Beyond that, the generality of his inno- cent” explanation and his inability to furnish specifics that support the generalization may reinforce the fact- finder’s impression that the witness is not telling the truth. And, finally, that impression may be reinforced still more by the inherent improbability that the innocent reason, even if factually correct, would truly have moti- vated the witness to dismiss an otherwise stellar em- ployee; as Walton recognized, the “inherent probability of testimony” may be key to the fact-finder’s assessment of th ewitness’ credibility.” The issue thus raised is central to the litigation of em- ployment discrimination cases where proof of intentional discrimination is required. It is common for the plaintiff to make out a prima facie case of intentional discrimina- As the court below observed, albeit in a different context, “(s)elf-serving . . . testimony is subject to especially searching scrutiny” (App. 16a). 12 Walton, 369 U.S. at 408, quoting Universal Camera Corp. v. Labor Board, 340 U.S. 474, 496 (1951). These considerations were present in this case with respect to all the petitioners. Two were rated Distinguished by respondent’s own evaluations, three Su- perior, and one Competent (see pp. 4-5, supra). It was surely for the jury to decide whether respondent’s witnesses’ testimony that they terminated long-standing employees of this caliber for the reasons they proffered should be credited. In ADEA cases as in all others, common sense remains a part of the jury’s fact-finding arsenal. The case of petitioner Tipton (p. 6, supra), furnishes a typical example. Respondent’s witnesses testified that they termi- nated this “Distinguished” employee (whose superiority in respond- ent’s view to the person who replaced him was undisputed) because with the tentative approval of higher management, he enlarged his office under arrangements that the smaller size could be reinstated on two hours’ notice at no cost to the company. The court below held that the jury was not free, from ite assessment of the de- meanor of respondent’s witnesses and of the inherent plausibility that a 20-year employee of Tipton’s quality would be peremptorily dismissed on such a trivial ground, to find this testimony incredible. ae 20 tion by introducing evidence establishing the elements, or an appropriate variation of the elements, set forth in Me- Donnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1978) (the plaintiff was qualified for the job, was a member of a protected group, and was denied (or removed from) the job, and the job was then given to another not in the protected group). As this Court has explained, proof of those elements eliminates: . at least . . the two most common legitimate reasons on which an employer might rely to reject a job applicant: an absolute or relative lack of qualifi- cations or the absence of a vacancy in the job sought. Elimination of these reasons for refusal to hire is sufficient, absent other explanation, to create an in- ference that the decision was a discriminatory one. [Teamsters v. United States, 431 U.S. 324, 358 n. 44 (1977) (emphasis added) .] If the inference is justified “absent other explanation,” what is the effect on that inference of testimony by an employer representative that the employer’s conduct at issue was motivated by some legitimate reason? * Obvi- ously, if the testimony of the employer witness is believed by the fact-finder, any inference of discrimination arising from the prima facie case would be wiped away. But if the testimony of the employer witness is not believed— whether because of plaintiff’s rebuttal case, plaintiff's cross-examination, the inherent implausibility of the ex- planation, or simply the witness’ demeanor—the inference of discriminatory intent would still be warranted. A dis- believed explanation can no more destroy the inference than an absent explanation. It follows that where an employer witness testifies to a legitimate reason for challenged conduct, the fact- finder must be allowed to determine whether that testi- mony should be believed, even if the plaintiff does not in- 18 Our discussion focuses solely on the factual inference that is warranted from the evidence establishing the prima facie case, not upon the status of the rebuttable presumption that also is created by such evidence. 21 troduce “countervailing evidence that it was not the real reason for the discharge.” (App. 20a). This Court ap- pears to have indicated as much in Texas Dept. of Com- munity Affairs v. Burdine, 450 U.S. 248, 254-256 and notes 9, 10 (1981), and in U.S. Postal Service Bd. of Governors v. Aikens, —— U.S. ——, 103 St. Ct. 1478, 1482-1483 (1983). The court below, which hears a large number of em- ployment discrimination cases, nevertheless reached the opposite result, holding that despite the plaintiff’s estab- lishment of a prima facie case an employer witness’ tes- timonial explanation of the reasons for the challenged conduct may require that an employment discrimination case be taken from the jury. Given the frequency with which the rule of the court below will be dispositive in disparate treatment litigation, its correctness should be addressed by this Court. 2. In reaching the conclusion just discussed, the court below analyzed the case as if plaintiffs had proved no more than a bare-bones prima facie case (App. 21a): The record in this case establishes that the plain- tiff-appellees were in the ADEA’s protected age group, that most were qualified, and that they were terminated and (except for one) replaced by younger employees. It carries the plaintiffs no further. As we have already shown, a prima facie case, whether bare-bones or not, is, by definition, sufficient to get a case to a jury where the defendant’s evidence of its reasons for taking the challenged action consists solely of the testimony of interested witnesses. But the court below believed that if the defendant provides an innocent ex- planation for his challenged action, a jury is not per- mitted to disbelieve that explanation unless the plaintiff has introduced some evidence of discriminatory intent over and above that contained in a bare-bones prima facie case. Assuming, arguendo, that the court were cor- rect on that point, a second issue worthy of this Court’s consideration is raised by the decision below: whether the court below erred in refusing to consider as proba- tive the evidence that ten highly qualified older employ- ees had been fired and replaced by significantly younger employees (all but one under age 40), and instead re- garding the case of each plaintiff as no stronger than if he were the only older employee dismissed. The court acknowledged that plaintiffs had . .. established that all six appellees were terminated, that all were over forty, and that all but Tipton were replaced by men under forty. Those fired averaged 49.5 years, their replacements 36.5. In addition, ap- pellees asserted that four persons other than appel- lees were terminated during the reorganization pe- riod and that each was over forty. [App. !7a-18a.] But the court held that such evidence was entitled to no weight because an expert on statistics called by defendant testified that, considering only the ages of the ten termi- nated employees and the ages of the employees who were not terminated, there was a 6.43 percent probability that age was not a factor in the terminations.“ The court ruled that this level of probability exceeded the “threshold of five percent” necessary for a finding of statistical sig- nificance, and therefore concluded that it was improper to consider plaintiffs’ evidence that the terminations were part of a pattern (App. 18a and n. 12, 20a). The court below noted that respondent’s expert did not factor into his statistical analysis the terminations of two district sales managers both over age 40 (one of whom was petitioner Heffer). The court, engaging in its own “expert” analysis, stated that “the statistical significance of age would obviously decrease” (App. 18a, n. 12) if district sales managers were included in the analysis. The court’s suggestion reflects a misunderstanding of the expert's method of analysis. When that method of analysis is properly understood, factoring in the district sales manager population and the terminations therefrom leads to a result contrary to the Court’s suggestion, i.e., it establises that the probability of all ten of the terminatees being over age 40 is leas than 3%, well below the 5% threshold for statistical significance accepted by the court. The proper analysis is set forth in detail in an appendix to our Petition for Rehearing filed in the court below. The court below reached that result apparently because of its understanding of principles emanating from this Court’s decisions in Castaneda v. Partida, 430 U.S. 482, 496-497 n. 17 (1977), and Hazelwood School District v. United States, 483 U.S. 299, 308-309 n. 14, 311-312 n. 17 (1977). This Court indicated in those cases that where a plaintiff’s case is based solely on statistical evidence— i.e., evidence that the numerical distribution of employees resulting from the employer’s conduct is as a matter of statistics unlikely to have occurred by chance—such evi- dence als] a general rule“ must establish, if the plain- tiff is to prevail, that “the difference between the expected value and the observed number is greater than two or three standard deviations.” A five percent likelihood that a particular numerical configuration could have resulted by chance is the approximate equivalent of a difference of two standard deviations. As we now discuss, this ruling of the court below is questionable for three distinct reasons. First, the court below seemed to assume that the sole relevance of evidence of defendant’s pattern of terminat- ing older employees was to show that, as a matter of probability, it was likely that age was a causal factor in each termination. At one point, the court even stated that [alt bottom, [plaintiffs’] case is one of statistical evidence.” (App. 18a, n. 12). But plaintiffs introduced no evidence of a statistical nature. It is true that the evidence relating to the pattern of terminations could give rise to an inference regarding the probability of an in- nocent explanation for each termination, and could indeed provide the raw data for a statistical analysis of that probability. However, that same evidence was probative on issues apart from the question of probability. Plaintiffs’ theory of the case was that their termi- nations were the result of defendant’s scheme to get rid of older employees and replace them with younger em- ployees. That theory proceeded initially from the evidence 24 of defendant’s announced desire for “new blood” and “lean and mean” executives. And, the theory required a show- ing that in fact defendant had terminated a number of highly qualified older employees and replaced them with significantly younger employees. Without such a showing, plaintiffs’ theory that each termination was part of a broader scheme would not be persuasive. But with such a showing, the evidence permitted the members of the jury to evaluate, based on their own experience and on the particular circumstances shown in the record evidence, and without reference to any analysis of probabilities, whether plaintiffs had proved such a scheme. If the jury believed that such a scheme existed, it could evaluate the credibility of the particular reasons given by the em- ployer for the termination of each plaintiff in that light. And, by the same token, the jury’s evaluation of the credibility of the reasons given for each termination might reflect on its determination of whether there was such a scheme. Thus, the first question raised by the court’s according no probative value to the evidence of a pattern of termi- nations of older employees is this: whether Castenada and Hazelwood meant to preclude a plaintiff’s reliance upon evidence of a pattern of conduct, where the events constituting the pattern do not by themselves lead to a statistically significant probability of discriminatory con- duct, but where the fact of the pattern is probative on an issue distinct from the question of probability. Second, even if the relevance of the pattern evidence were restricted to questions of probability, the conclusion reached by the court below would be contrary to well- established rules of evidence and to decisions of other circuits. Lay persons, without the benefit of statistical expertise, may perceive a particular pattern of events to be so unlikely as to give rise to an inference that the pattern did not occur by chance but was intended. Such pattern evidence has always been considered probative 25 without any showing of satistical significance.“ Thus, Wigmore explains: Without formulating any accurate test, and without attempting by numerous instances to secure absolute certainty of inference, the mind applies this rough and instinctive process of reasoning, namely, that an unusual and abnormal element might perhaps be present in one instance, but that the oftener similar instances occur with similar results, the less likely is the abnormal element likely to be the true explana- tion of them. [2 Wigmore, Evidence § 302 (Chad- born Ed., 1979) .] See also, e. g., Carter v. Duncan-Huggins, ——- F.2d ——, 34 FEP Cases 25, 32-33 (D.C. Cir. 1984) ; Jay Edwards, Inc. v. New England Toyota Distributor, 708 F.2d 814, 824 (ist Cir.), cert. denied, 104 S. Ct. 241 (1983); Marsh v. Eaton Corp., 639 F.2d 328, 329-330 (6th Cir. 1981); N.L.R.B. v. Cameo, Inc., 340 F.2d 803, 809-812 (5th Cir. 1965), and cases cited therein. The decision below, which rules that such pattern evi- dence may not be considered by the fact-finder without a showing of statistical significance, cannot be recon- ciled with the results of the cases just cited. Indeed, in Marsh and Carter, the Sixth Circuit and the District of Columbia Circuit, respectively, expressly rejected the precise reasoning adopted by the court below: in both cases the plaintiff had introduced evidence of a pattern akin to the evidence introduced by plaintiffs in the in- stant case; in both cases, the defendant argued that such evidence was not probative because the plaintiff had not shown the pattern to be “statistically significant”; in both cases, that argument was rejected. 639 F.2d at 329; 34 FEP Cases at 32-33. The following passage in Carter succinctly describes the rationale of both Carter and Marsh: 15 Of course, as Castenada and Hazelwood suggest, such evidence standing alone might not be sufficient to establish a plaintiff's case. 41 * 6 F 26 “A plaintiff attempting proof of disparate treatment in a small work force is entitled to offer evidence and argument, be it persuasive or not, involving comparison of treatment accorded different workers. The ‘statistical’ inferences to be drawn are for the trier of fact. As with any other circumstantial evidence the jury was the proper body to weigh the evidence and to decide whether any inferences could be drawn. [34 FEP Cases at 32 (quoting and adopting district court opinion) and 33] This Court should grant the writ of certiorari in this case to resolve the conflict between the decision below and the decisions in Marsh and Carter. The issue of the probative value of pattern evidence in the absence of proof of statistical significance is important in the day-to-day judicial processing of the various types of discrimination cases. And, this case presents an appropriate occasion to settle the law on this point. Third, in yet another respect, the ruling in question conflicts with a decision of the Eighth Circuit. While plaintiffs in the instant case did not introduce any sta- tistical evidence, defendant chose to do so. Defendant’s expert testified that based solely on an analysis of the ages of the employees who were terminated and the ages of the employees who were not terminated—and without taking into account such factors as the qualifications and ratings of the terminated employees or the ages of the employees who were hired to replace the terminated em- ployees there was a 6.43 percent probability that age was not a factor in the terminations. That probability level considered by itself might not have been sufficient 1 The court below stated that defendant's expert compared the ages of the terminated employees “to the ages of their ments” (App. 18a). The court was mistaken in so stating. ant’s expert expressly acknowledged that he did not take count the ages of the replacements in his analysis of rt sort was a factor in the terminations (Tr. 883). if bs : 1 27 to establish a case of intentional discrimination. See p. 28, supra. But, in this case, that probability level might well have been deemed probative by the jury when con- sidered in conjunction with the other evidence in the case. The jury had much more to work with than had de- fendant’s expert. The jury knew not only the ages of the terminated employees and the non-terminated employees, but also that: (1) the replacement employees were on the average 18 years younger than the terminated em- ployees; (2) a number of the terminated employees were highly qualified and had received ratings of “Superior” or “Distinguished”; (3) the employer’s new management had expressed a desire for “new blood” and a “lean and mean” team; and (4) the reasons given by the em- ployer for a number of the terminations were, or could be found to be, of dubious persuasiveness. Moreover, the expert took it as a given that a substantial number of senior executives were to be “purged” (App. 4a), and examined only the likelihood that all would be over 40; the jury was entitled to inquire whether such a purge— wholly unprecedented in the company’s history (Tr. 588) —would have occurred at all but for the ages of the vic- tims. Considered in this context, the jury might well have found the probability finding of the defendant’s expert— which was based on only a portion of the evidence pre- sented to the jury—to be helpful in reaching its conclu- sions. If there were only a 6.43 percent likelihood that age was not a factor without, for example, taking into ac- count the ages of the replacements or the qualifications of the terminatees, the jury might well have concluded that that likelihood would be less were these additional factors accounted for. The question thus raised is whether statistical evidence of probability levels that are not standing alone found to be “statistically significant” may be considered by the fact-finder in conjunction with other evidence of dis- criminatory intent. The court below answer that ques- tion in the negative. The Eighth Circuit, in Inmates of 28 Nebraska Penal, Etc. v. Greenholtz, 507 F. 2d 1868, 1379 (8th Cir. 1977), cert. denied, 489 U.S. 841 (1978), reached the opposite conclusion. This conflict, too, should be resolved by this Court. The issue of the use of statistical evidence that falls short of “statistical significance” is a recurring one in employ- ment discrimination litigation. This case presents an appropriate occasion to clarify the law on this issue. 3. The court below held that where an employer’s offi- cial testifies that innocent reasons motivated the chal- lenged employment decision, and those reasons are “ra- tional ones, the objective truth of which is not seriously disputed, the burden of establishing them as pretextual is a heavy one indeed“ (App. 22a). It is a rare em- ployee who, after decades of service, has not done some- thing that an employer could seize upon as a pretext for a discriminatorily motivated decision. As there will al- most always be something which the employer’s witnesses can testify to, the “objective truth” of which cannot be “seriously disputed,” the “heavy burden” that the court below has mandated will result in directed verdicts for defendants in discharge cases where, applying the ordi- nary evidentiary rules, discrimination would be found.“ 17 The assessment of the court below that in this case the ob- jective truth” of the reasons proffered by respondent’s witnesses was not “seriously disputed”—a formulation repeated twice in the court’s opinion (App. 20a, 22a, emphasis added)—indicates the Fifth Circuit’s continuing propensity to reweigh the evidence in discrimination cases. See Pullman-Standard v. Swint, 456 U.S. 272 (1982). Petitioners did “seriously dispute” the “objective truth” of the reasons proffered by respondent's witnesses. See pp. 5-8, supra. In part, the court below arrived at its contrary assess- ment simply by mischaracterizing the record evidence. For ex- ample, Tipton, while acknowledging that he had enlarged his office, testified that he had been authorized to do so by his immediate supervisor, and the supervisor testified to the same effect (see p. 6, supra). Yet the court below “found” that the supervisor “did not remember approving this action” (App. 4a, n. 5). Spradley testified that he had transferred voluntarily from a vice-presidency to man- ager of national accounts because the work in the latter position (but not the former) was within his area of interest and expertise, 1 29 The severity of the “heavy burden” that the court below imposed is reflected by its application in this case. The court refused to permit a jury finding of pretext despite petitioners’ showing that that respondent had con- sistently evaluated them as Superior“ a'd “Distin- guished” employees, that the reasons assigned for their terminations were relatively trivial, that they were ter- minated without even a prior conversation or opportunity to plead for retention, and that despite their decades of service and respondent’s acknowledgement that most were commendable employees they were not offered retention in some other capacity.” This Court has never held that plaintiffs have a “heavy burden” to prove pretext. On the contrary, this Court has decreed that the factual question of motive is to be decided “just as district courts decide disputed questions of fact in other civil litigation.” Aikens, 103 S. Ct. at 1482. “In short, the [fact-finder] must decide which party’s explanation of the employer’s motivation it be- lieves.” Ibid. There is no place in this scheme for the “heavy bur- den” the court below has imposed. That requirement would deprive plaintiffs of the protection of federal law in numerous cases where, applying the usual burdens, discrimination would be found. The “important national policy” reflected in the equal employment statutes (Aikens, 103 S. Ct. at 1482) thus would be disserved. This Court accordingly should strike down the “heavy burden” requirement imposed by the court below. and respondent's witness confirmed that the transfer was voluntary (see p. 8 n.4, supra). Yet the court below “found” that the transfer was “a decided demotion” (App. 19a). The court below also usurped a jury function in its repeated pronouncements that the reasons proffered by respondent’s witnesses were, in all the circumstances of this case, persuasive explanations for the terminations (App. 20a-22a). See p. 19, n. 12, supra. 18 Ironically, the one petitioner allegedly discharged for “cause” (Tipton) was the only one offered retention in another capacity. See p. 4 and n. 2, supra. CONCLUSION For the reasons set forth hereinabove, this Court should grant certiorari to review the decision below. Respectfully submitted, ELior P. TUCKER MICHAEL H. GOTTESMAN MANDELL & WRIGHT (Counsel of Record) 21st Floor ROBERT M. WEINBERG 806 Main St. Perer O. SHINEVAR Houston, TX 77002 BREDHOFF & KAISER 1000 Connecticut Ave., N.W. Curis Dum Suite 338 Washington, D.C. 20086 $808 Main St. (202) 838-9340 Houston, TX 77002 APPENDIX la APPENDIX UNITED STATES COURT OF APPEALS FIFTH CIRCUIT Nos. 81-2356, 82-2235 JACK ELLIOTT, et al., Plaintiffs-A ppellees-Cross Appellants, v. GROUP MEDICAL & SURGICAL SERVICE, et al., Defendants, Group HOSPITAL SERVICE, INC., Defendant-Appellant-Cross Appellee. Sept. 16, 1983 Before THORNBERRY, GEE and REAVLEY, Circuit Judges. GEE, Circuit Judge: The Age Discrimination in Employment Act, 29 U.S.C. § 621 et seg. (“ADEA”), was enacted on December 15, 1967 (effective June 12, 1968), following the completion of a study by the Secretary of Labor required by Con- gress when it enacted the Civil Rights Act of 1964.“ The 1 Age discrimination was at first included in draft legislation which was to become Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 20000 et seg. (1976), but later deleted in favor of a study. Subsequent to the completion of the study, Congress lifted the sub- stantive provisions of Title VII almost verbatim in drafting the ADEA. In consequence, courts have construed the two sets of legis- lation consistently and cases from one are frequently applied to similar cases under the other. See generally Note, The Age Dis- crimination in Employment Act of 1967, 90 Harv.L.Rev. 880 (1976). More, in Osecar Mayer & Co., v. Evans, 441 U.S. 760, 756, 99 S.Ct. 2066, 2071, 60 L.Ed.2d 609 (1979), the Court instructed that where the source of a section in the ADEA parallels Title VII the two statutes are to be construed consistently. 2a ADEA’s announced goal is the “elimination of discrimi- nation from the workplace,” Lorillard v. Pons, 434 U.S. 575, 577, 98 S.Ct. 866, 868, 55 L.Ed.2d 40 (1978) by pl romoting employment of older persons based on their ability rather than age... [and] prohibit ing] ar- bitrary age discrimination in employment.” 29 U.S.C. § 621(b). To this end, the ADEA provides statutory pro- tection to individuals aged forty through seventy. Id., § 631(a). This appeal concerns a suit brought pursuant to the ADEA by six protected former employees (collec- tively referred to as “appellees”) of Group Hospital Serv- ice, Inc. (“Hospital Service”), appellant. In the district court, the jury found, inter alia, that these former em- ployees had been willfully discriminated against because of age. Concluding that the evidence adduced at trial was insufficient to support the jury’s verdict, we reverse the judgment of the district court. Background and Procedural History Two major contentions are before us. The first con- cerns the sufficiency of the evidence to support the jury’s finding of age discrimination and certain attendant pro- cedural issues. The second centers upon the propriety of a prophylactic order of the district court. The district court denied appellees’ motion for liquidated damages. However, it granted a motion for a supersedeas bond to protect appellees’ interest in the event this court deter- mined that that ruling was in error.’ ? The ADEA provides that “liquidated damages shall be payable only in cases of willful violations of this chapter.” 29 U.S.C. §626(b). See id. §216(b) (defining liquidated damages). Within this circuit the above constraint has been construed as permissive. Hence if, after a jury finding of willfulness, the trial court makes a finding that the employer acted in good faith and had reasonable grounds for believing that its actions were not violative of the ADEA, the trial court possesses the discretion to determine the amount, if any, of a liquidated damages award. See Hendrick v. Hercules, Inc., 658 F.2d 1088 (5th Cir. 1981); Hays v. Republic 3a Because the procedural posture of the present action is somewhat complicated and because our resolution of the procedural issues guides our analysis, we delineate the facts as developed below with some care. The record reflects that sometime during April of 1978 Walter Hachmeister learned that he was president-elect of Hos- pital Service, an insurance company incorporated under the laws of Texas and doing business as Blue Cross-Blue Shield of Texas.* In preparation for his role as presi- dent Hachmeister began to assemble a management team Steel Corp., 581 F.2d 1807 (5th Cir. 1976). The trial court here, despite the jury’s specific finding of willfulness, declined to award liquidated damages. Appellees contend that our permissive ap- proach to liquidated damages runs counter to both the policy and underlying legislative history of the ADEA and urges that we join those circuits that have held that upon a finding of willfulness, liquidated damages in the amount of actual damages must be awarded. See Loeb v. Textron, Inc., 600 F.2d 1008 (Ist Cir. 1979); Goodman v. Heublein, Inc., 645 F.2d 127 (2d Cir. 1981); Wear v. Burroughs, Inc., 619 F.2d 276 (3d Cir. 1980); Syrock v. Milwaukee Boiler Mfg. Co., 27 F.E.P. 610 (7th Cir. 1981); Kelly v. American Standard, Inc., 640 F.2d 974 (9th Cir. 1981). In the alternative, appellees argue that because of the specific finding that Hospital Service willfully violated the ADEA and because the district court declined to award liquidated damages without making factual findings of good faith, on the record, we must remand for such a determination. Hendrick, supra, is cited as support for this legal theory. In light of the ultimate disposition of the present case we must decline appellees’ offering. Accordingly, we express no view as to whether Hendrick requires a trial court to enter its factual findings on the record in order to support its discretion in this area. Nor do we believe the present facts warrant an inquiry into our established approach to liquidated damage awards. 2 Our understanding of the record indicates that Hachmeister was president-elect of Hospital Service. In turn Hospital Service is the parent organization of Group Medical and Surgical Service and Group Life and Health Company. Collectively these entities do business in Texas under the name Blue Cross-Blue Shield of Texas and enjoy an independent yet advisory relationship with other Blue Cross-Blue Shield plans. 4a and to review the company’s past performance.“ Hach- meister’s analysis concluded that Hospital Service could increase both the efficiency of its sales operations and its market penetration by consolidating its Life and Mar- keting Divisions so as to eliminate overlapping in their respective sales functions. In consequence, Hachmeister implemented a plan to accomplish this goal upon assum- ing the presidency. Under this reorganization a number of top executives in the Marketing Division were purged: (1) Richard Galen was replaced as an Assistant Vice President; (2) George Spradley was relieved of his duties as Manager of National Accounts; (3) Robert Heffer was replaced as Houston North District Manager; (4) Duane Thompson was replaced as Sales Training Director; and (5) Jack Elliott was ousted as Regional Sales Manger for the Houston Region. In addition, subsequent to the reor- ganization, Max Tipton was replaced as Manager of the Abliene Regional Offices.“ Each of the above-mentioned The line managerial hierarchy of the marketing division in descending order is as follows: Vice President, Assistant Vice President, Regional Sales Manager I, Regional Sales Manager II, Regional Sales Manager III and District Manager. Director of Sales Training and Manager of National Accounts appear not to be considered line functions and report directly to the Vice President. In total the above titles represent approximately 29. persons, all with a significant degree of managerial authority. Appellees make much of Hachmeister’s consultations with two regional managers, individuals obviously within the managerial chain of command and vested with organizational responsibility. We find nothing invidious in such à consultation where the sole charge is that they were younger than the employees discharged. In fact, appellees conceded that these particular managers were extremely bright and capable. 5 At trial Tipton stipulated that his discharge was not a part of the corporate reorganization and that he was terminated for in- subordination in the form of changing the structural plans of the Abilene Regional Office to effectively give himself an office that was twice. as large as approved: by. company policy. At trial Tipton urged that he sought and received approval for this action. We note that appellee’s co-defendant, Galen, was his immediate super- visor and did not remember approving this action. 5a executives were within the ADEA’s protected age group. More, each, with the exception of Tipton, was either given notice of termination or terminated between Octo- ber 1978 and January 1979, and filed notice pursuant to 29 U.S.C. § 626(d) with the Department of Labor of his * Appellant urges in this appeal that appellees Elliott and Galen did not timely file a notice of intent to sue because each had con- structive notice of his termination prior to the final day of em- ployment by virtue of a Cessation of Employment Agreement. The agreement between Elliott and the company is presented here by way of example; the Galen agreement is substantially the same: As mutually agreed, effective October 9, 1978 your responsi- bilities and authority as Regional Sales Manager C of our com- panies will cease. This action does not cease your employment with Group Hospital Service, Inc., and you may continue your employment for up to three months from the date of this agreement. During your continued employment, it is agreed: 1. You will earnestly solicit other gainful employment during this three-month period, and should you find other gainful em- ployment during this three-month period, your employment with Group Hospital Service, Inc., will cease on the last day of the pay period in which you commence your other gainful employment. Determination of what constitutes “other gainful employment” shall be made by Group Hospital Service, Inc. 2. Due to the circumstances, attendapce in our offices and regular working hours will not be expected during your con- tinued employment with Group Hospital Service, Inc. You will be available for inquiries by Group Hospital Service, Inc., and will respond in good faith and to the best of your abilities to any such inquiry. 3. You will return all company property on the date of this agreement and your status as a required company car user ceases on the date of this agreement. 4. All other employee benefits will continue during your con- tinued employment and your salary at its present level will be paid at the end of each pay period in accordance with present salary administration policy. F. This document constitutes the complete agreement con- cerning your cessation of employment with Group Hospital Service, Inc. 6a intent to sue Hospital Service, Group Medical and Surgi- cal Service, and Group Life and Health Company. Tipton filed a corresponding notice on June 29, 1979. On October 22, 1979, these former employees, acting in concert, filed suit in the United States District Court for the Southern District of Texas. The gravamen of their complaint was that they had been willfully discriminated against be- cause of age. The defendant companies answered that appellees were indeed terminated and that they were within the ADEA’s protected age group at the time of their termination. In addition to conceding that appellees had been replaced by persons outside of the ADEA’s protected age group, they urged that Group Medical and Surgical Service and Group Life and Health Company were improperly joined as party defendants. At the close of appellees’ case in chief, the district court instructed a verdict as to all de fendants except Hospital Service. Hospital Service, in turn, moved to dismiss the claims of Elliott, Galen and Heffer for failure “to fulfill the jurisdictional prerequisites required to maintain an action under the provisions of the Age Discrimination in Employment Act of 1967.” See Fed.R.Civ.P. 12(b) (6). In sum, Hospital Service urged that the district court did not have jurisdiction to en- tertain the complaints of these parties because they had failed to file a notice of intent to sue within 180 days after the occurrence of the discriminatory action com- plained of. See 29 U.S.C. § 626 (d) (1). Appellant also argued that plaintiffs Galen, Tipton and Spradley had failed to establish a prima facie case. See Price v. Mary- land Casualty Co., 561 F.2d 609 (5th Cir. 1977). The district court carried the former motion with the case and denied the latter. At the close of its case in chief, Hospital Service prof- fered the following motion: “to dismiss on the grounds 7a that plaintiff failed to make a prima facie case.“ The 7 Apparently there was some confusion at the close of all the evidence and the court reporter neglected to transcribe appellant’s motion at the time it was made. The following affidavit reflects our understanding of the circumstances surrounding appellant’s motion: AFFIDAVIT COMES NOW Ernie J. Ambort, Jr., and gives the following sworn affidavit: I. THAT I reside at 16330 David Glen, Friendswood, Harris County, Texas; that I can de reached by telephone at (713) 482-0970. II. THAT presently I am self-employed as a free-lance court re- porter in Houston, Texas. THAT at all times material to this Affidavit I was employed as a court reporter for the United States District Court for the Southern District of Texas, Houston Division. III. THAT I was the court reporter for the case of Jack Elliott, et al vs. Group Hospital Service, Inc., et al; Civil Action No. H-79-2179 tried in July, 1981 before the Honorable George E. Cire, United States District Judge. THAT I have caused to be filed an official transcript of said trial with the United States Court of Appeals, Fifth Circuit. IV. THAT the transcript of said trial proceedings as filed does not reflect that the attorney representing the defendant made a motion that the defendant after the close of all of the evidence renewed its motion made at the close of the Plaintiff’s case to dismiss on the grounds that the Plaintiff failed to make a prima facie case. 4 onen 8a district court permitted the case to go to the jury. In response to special issues, the jury found that Hospital Service had discriminated against each of the named plaintiffs by discharging him from his employment be- cause of his age and that the discharges were willful. The jury awarded damages aggregating over one million dol- lars to the plaintiffs in amounts for which the district court subsequently entered final judgment, adding attor- neys’ fees and costs. As noted above, the district court declined to award liquidated damages despite the jury’s finding of willfulness. Both parties appealed, Hospital Service from the adverse judgment, asserting evidentiary insufficiency; appellees from the refusal of the court to award liquidated damages, claiming a legal right to addi- tional liquidated damages in an amount equal to the jury’s damage award. See note 2, supra. On motion, the district court entered a Stay Order pending appeal, on condition that Hospital Service post security in an amount equal to the award. Subsequent to this order plaintiffs moved the district court to require additional security, contending that more was necessary in order to satisfy the potential judgment on appeal should we determine that an award of liquidated damages was required. The district court entered an order granting the motion and required appellant to post additional se- curity. Procedural Issues A. Motion for Directed Verdict? Our threshold consideration concerns which issues have been preserved on appeal. If, as appellees suggest, appel- lant’s motion at the conclusion of all the evidence did not made at the close of the Plaintiff’s case on the grounds that the Plaintiff did not make a prima facie case and that such motion was overruled; and that I failed to properly record TTP courtroom as instructed. Wl * 9a constitute a motion for directed verdict then we are pre- cluded from considering Hospital Service’s request for a reversal of the district court’s judgment. See Thomas v. City of New Orleans, 687 F.2d 80, 83 (5th Cir. 1982). Initially, appellees’ briefs urged that Hospital Service’s motion “preserves no error because it refers to only one plaintiff and because it fails to specify which plaintiff defendant contends failed to prove a prima facie case.” In this connection appellees also advanced the ancillary argument that the motion lacked the required specificity to be properly considered a motion for directed verdict. See Fed.R.Civ.P. 50(a). In the alternative, appellees con- tended that at most Hospital Service’s motion preserved only the motion made at the close of appellees’ case in chief—that Galen, Tipton and Spradley failed to prove a prima facie case. This argument suggests that our analy- sis is confined to an examination of whether a prima facie case was in fact established and no more. Upon reflection appellees concede, and we agree, that appellant’s reference to a single plaintiff was no more than a slip of the tongue in the heat of trial and that the intended object of the motion was the entire opposing ar- ray. Appellees insist, however, that this concession does not vitiate their argument that Hospital Service is barred from questioning the sufficiency of the evidence in this court because its motion for dismissal for want of a prima facie case does not rise to the specificity required of a motion for directed verdict, its motion for judgment n. o. v. notwithstanding. See Maxey v. Freightliner Corp., 665 F.2d 1367 (5th Cir. 1982). More, appellees maintain their stance that in any event our analysis is confined to whether the elements of a prima facie case are present and no more. The law in this circuit, as generally elsewhere, is that “the sufficiency of the evidence supporting a jury verdict is not reviewable on appeal. . . unless a motion for di- 10a rected verdict was made at the close of all the evidence by the party seeking that review.“ Quinn v. Southwest Wood Products, Inc., 597 F.2d 1018, 1024 (5th Cir. 1979). As we noted in Quinn, however, the strict application of this rule gives way to considerations of policy and fundamen- tal fairness: When a claimed deficiency in the evidence is called to the attention of the trial judge and of counsel be- fore the jury has commenced deliberations, counsel still may do whatever can be done to mend his case. But if the court and counsel learn of such a claim for the first time after verdict, both are ambushed and nothing can be done except by way of a complete new trial. It is contrary to the spirit of our proce- dures to permit counsel to be sandbagged by such tactics or the trial court to be so put in error. The rule is a strict one, however, and we and other courts have taken a liberal view of what constitutes a motion for directed verdict for these purposes. There is much to be said for the view that whenever a party, at the conclusion of the evidence and before the jury has begun to deliberate, clearly points out a claimed evidentiary deficiency to court and counsel, not by way of conversation or speculation but on the record in an unambiguous formal motion for relief, however denominated, this should suffice. To hold otherwise would be to succumb to a nominalism and a rigid trial scenario as equally at variance as am- bush with the spirit of our rules. 597 F.2d at 1025 (footnote omitted) (emphasis supplied). See also C. Wright & A. Miller, Federal Practice and Procedure: Civil § 2536, p. 594. Applying these notions to the present case impels the conclusion that appellant’s motion at the close of all the evidence should be read as a motion for a directed verdict. We reach this determina- tion through a series of questions whose answers we find grounded in reason. lla In age discrimination cases the relevant inquiry is whether the plaintiff has produced evidence from which a trier of fact might reasonably conclude that the employer intended to discriminate in reaching the decision at issue. In order to establish a prima facie case the discharged employee, generally, must prove he (1) is within the pro- tected class; (2) was discharged; (3) was qualified for the position; (4) was replaced by someone outside the protected class, Price v. Maryland Casualty Co., 561 F.2d 609 (5th Cir. 1977); or (5) by someone younger, Wilson v. Sealtest Foods, 501 F.2d 84 (5th Cir. 1974); or (6) show otherwise that his discharge was because of his age, McCuen v. Home Insurance Co., 633 F.2d 1150 (5th Cir. 1981). Thus the elements of such a prima facie case come to little more than establishing the standing requirements of the ADEA and blunting the defendant’s probable re- joinder that the plaintiff has not been discriminated against. See Williams v. General Motors, Inc., 656 F.2d 120 (5th Cir. 1981); McCorstin v. United States Steel Corp., 621 F.2d 749 (5th Cir. 1980). In contrast, when such a motion comes at the con- clusion of all the evidence and the defendant has put forth evidence in rebuttal, logic indicates that the motion must speak to more. In this instance, the defendant mounted a factual attack against the plaintiffs’ case, its resolution requiring a review of plaintiffs’ evidence as compared to that presented by the defendant and a determination whether the evidence was such that reasonable men could come to but one conclusion. We believe that this analysis is equivalent in all respects to that required when consid- ering a motion for directed verdict. See Hedrick v. Her- cules, 658 F.2d 1088, 1089 (5th Cir. 1981). This being so, the action called for by defendant’s motion, even if restricted to its terms, would be the same as that on mo- tion for directed verdict and there is no unfairness in viewing it as such. So doing, we hold that the motion relates back to those motions raised at the conclusion of 12a plaintiff’s case in chief and thus preserves appellant’s right to challenge both the sufficiency of the evidence sup- porting the jury’s verdict as to all the appellees and the timeliness-of-filing issues relating to appellees Elliott, Galen and Heffer. See Dawson v. McWilliams, 146 F.2d 38 (5th Cir. 1944). B. Filing of Notice of Intent to Sue Because we arrive by differing routes at the conclusion that appellees Elliott, Galen and Heffer timely filed notice of their intent to sue, we treat the issues separately. (1) Galen and Elliott The precise issue presented here is whether appellees Galen and Elliott were required to file notice of intent to sue within 180 days of notice of their terminations or whether the time of filing commenced to run only after a total cessation of their employment. If the former stand- ard be applicable, it follows that the June 25, 1979, filing is time barred, since appellees raise no substantial claim that the filing was tolled. See Zipes v. Trans World Air- lines, 455 U.S. 385, 102 S.Ct. 1127, 71 L.Ed.2d 234 (1982). The record reflects that both Galen and Elliott ot 13a date of notice of termination, rather than the final date of employment, is the operative date from which the 180 day filing requirement begins to run, see Marshall v. Kimberley Clark Corp., 625 F.2d 1300 (5th Cir. 1980); Payne v. Crane Co., 560 F.2d 198 (5th Cir. 1977), they do not govern this case. As a general proposition, new judge-made rules on limitations are not to be applied retroactively to a plain- tiff who timely filed his complaint under the then exist- ing law of limitations. Chevron Oil Company v. Huson, 404 U.S. 97, 92 S.Ct. 349, 30 L.Ed.2d 296 (1971). Be cause the record reflects that the present action was filed before the Supreme Court’s decision in either Ricks or Chardon, we believe the above principle to be applicable here. Accordingly, we must determine the state of the law of this circuit before Ricks and Chardon. Our standard had been that “when the employer, by acts or words, shows a clear intention to dispense with the services of an employee, a discharge occurs at the latest as of the date after which the services are no longer accepted.” Payne, supra, at 199. This standard we cast the determination of when the employment re- lationship ceased as a question of fact. Marshall v. Kim- berley Clark Corp., supra, is illustrative of the above l4a are unable to say that reasonable men could not reach that conclusion. (2) Heffer Whether Mr. Heffer timely filed notice of intent to sue was examined both by the trial court in disposing of appellant’s motion for summary judgment and by the jury as a special interrogatory. Both concluded that Heffer’s notice of intent to sue had been timely filed. We agree. Section 627 of the ADEA requires employers to post information setting forth their employees’ rights under the ADEA. See 29 U.S.C. § 627; 29 C. F. R. § 850.10.° In Charlier v. S.C. Johnson & Son, Inc., 556 F.2d 761 (5th Cir. 1977), we held that an employer’s failure to comply with section 627 vitiates the normal assumption that an employee is aware of his rights under the ADEA. Id. at 765. In consequence, under such circumstances the ADEA’s 180-day filing period is not measured from the employee’s cessation of employment, but rather from when he acquired actual knowledge of his ADEA rights, usually a fact question. Id. In disposing of appellant’s motion for summary judgment the district court con- cluded that Hospital Service failed to post the required ADEA notice at Heffer’s place of employment and that Heffer had filed a notice of intent to sue within 180 days of acquiring actual notice of his rights. In reaching this conclusion the district court rejected Hospital Service’s claim that Heffer possessed constructive notice of his ADEA rights either by virtue of his exposure to company 29 C.F.R. § 850.10, promulgated pursuant to section 627, provides: Every employer, employment agency, and labor organization 15a policy due to his seniority or as a consequence of having visited other company offices where such a notice was posted. See Adams v. Federal Signal Corporation, 559 F.2d 433 (5th Cir. 1977). Obviously the jury also chose to disregard appellant’s theory of constructive notice. Appellant insists that substantial evidence supports its position that Heffer was aware of his ADEA rights be- fore his discharge. It is not, however, our province to substitute our view of the truth for that of the jury. Rather, our task is to examine the evidence in its en- tirety to determine whether it reasonably supports the jury’s verdict. See Boeing Co. v. Shipman, 411 F.2d 365, 374 (5th Cir. 1974). The record reflects that there was no section 627 no- tice posted at Heffer’s place of employment. It also re- flects that there was a genuine factual dispute as to whether Heffer or some othr manager had been charged with the responsibility of pusting the notice on the com- pany’s behalf. More, whether Heffer possessed knowl- edge of the company’s alleged policy against age discrimi- nation was the subject of a classic swearing match. The jury believed Heffer; there it ends. Having determined that we may properly examine the merits of the case, we now turn to them. Sufficiency of the Evidence As the Supreme Court has recently reminded us, the ultimate issue of fact in cases such as this—whether the defendant intentionally discriminated against one or more of the plaintiffs—is to be reviewed under the same stand- ards as those in other cases. United States Postal Service Board of Governors v. Aikens, —— U.S. ——, 108 S. Ct. 1478, 75 L.Ed.2d 403 (1983). Where, as here, the case has been fully tried on the merits, the adequacy of a party’s showing at any particular stage of the McDonnell 16a Douglas ritual is of no consequence. We are simply to determine whether the record contains evidence upon the basis of which a reasonable trier of fact could have con- eluded as the jury did. New England Merchants National Bank v. Rosenfield, 679 F.2d 467 (5th Cir. 1983). Self- serving and speculative testimony is subject to especially searching scrutiny. Id.; Ralston Purina Co. v. Hobson, 554 F.2d 725 (5th Cir. 1977). More specifically on point, we have recognized that generalized testimony by an em- ployee regarding his subjective belief that his discharge was the result of age discrimination is insufficient to make an issue for the jury in the face of proof showing an adequate, nondiscriminatory reason for his discharge. Houser v. Sears, Roebuck & Co., 627 F.2d 756 (5th Cir. 1980). Bearing these principles in mind, we turn to the evidence in our case. The parties have followed generally the McDonnell Douglas format, described in note 9 above, in presenting their evidence below and their arguments on appeal. * This is one of the modes of organizing the evidence in dis- crimination cases. By it, the plaintiff must first establish a prima facie case, thus creating a rebuttable presumption that he has suffered discrimination. If the evidence ends here, the plaintiff should prevai! by directed verdict. The defendant may avoid that result by introducing evidence that he acted for a nondiscrimina- tory reason, which the plaintiff may then attack as McDonnell Douglas Corp. v. Green, 411 U.S. 792, 98 S.Ct. 1817, 86 L.Ed.2d 668 (1978). The plaintiff retains the burden of per- suasion on the whole case. Tezas Department of Community Affairs v. Burdine, 460 U.S. 248, 256, 101 S.Ct. 1089, 1095, 67 L.Ed.2d 207 (1981). 17a There is no direct evidence of age discrimination, and that format is one way of presenting a circumstantial evidence case. Since they have done so, it is necessary for us to discuss the elements of that format even though our concern is not with the state of the evidence at any of its stages, but rather with the evidence in the case at large. United States Postal Service Board of Governors v. Aikens, supra. According to the teaching of McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973) and its progeny, in order to establish a prima facie case of age discrimination a plaintiff must prove that he (1) was discharged; (2) was qualified for the position; (3) was within the protected class at the time of discharge; (4) was replaced by someone out side the pro- tected class, or (5) by someone younger, or (6) show otherwise that his discharge was because of his age. See page 7264, supra. At the outset we note that with the exception of ap- pellee Spradley there exists no dispute as to whether appellees are qualified to perform their individual tasks. We therefore examine the evidence without consideration of this factor, leaving Spradley’s qualifications for dis- cussion below. First, appellees introduced evidence that Hachmeister stated that he wanted “new blood” in the Marketing Division and a new “lean and mean” team. Extrapolating from this statement, appellees surmised during their individual testimony that it was Hospital Service’s policy to terminate older workers because a “lean and mean” team necessarily excluded them. To buttress this inference, appellees established that all six appellees were terminated, that all were over forty, and that all but Tipton were replaced by men under forty. 11 We recognize that McDonell Douglas, supra, involves a Title VII action. However, the analysis of Title VII cases has been applied to ADEA cases given the common purpose of their nearly identical substantive provisions. See note 1, supra. a 7 x * 5 ve 18a Those fired averaged 49.5 years, their replacements 36.5. In addition, appellees asserted that four persons other than appellees were terminated during the reorganization period and that each was over forty. An expert witness called by the appellant, Dr. William Schucany, a statis- tician, testified however that his analysis of the ages of those fired during the relevant period, as compared to the age of their replacements and to the ages of those occupy- ing similar positions in the company, established only that age could neither be ruled in nor ruled out statistically as the factor leading to the discharges.* On the basis 12 At bottom, appellees’ case is one of statistical evidence. Dr. Schucany analyzed the upper management of the department which subsequently fell under the domain of the Vice President of Mar- keting. See note 4, supra. There were 29 persons in these upper- level management positions, including all of the appellees except Heffer. Seven of those persons were terminated before the end without age being a factor. The test was run twice, once including Tipton among those terminated and once excluding him. With Tipton excluded, the probability that age was not a factor was 8.57 percent; with Tipton included it was 6.43 percent. The standard methodology in this test is to compare the result was a factor, and concluded that it probably was. In fact, this per- centage fell well under five percent. As noted above, the test did not include Heffer or other district sales managers. However, the record reflects that there were 21 district sales managers in the time frame covered. Of these, twelve were over forty. Of the twelve over forty, only two were terminated. If these employees were included in the statistical model the statistical significance of age would obviously decrease. Thus, it appears that the statistical evaluation undercuts the theory that age was a determining factor in any of the employment decisions. See Harrell v. Northern Electric Company, 672 F.2d 444, 446-47 (5th Cir. 1982) (statistical proof negated claim of absence 19a of this evidence, appellees contend that the most likely reason for their discharges was age in each instance. Appellant Group Hospital contends to the contrary that each discharge resulted from a corporate reorganization designed to increase management efficiency. It introduced evidence that the reason for Galen’s discharge was a per- ceived disloyalty because he had sought to undercut his immediate superior, approaching Hachmeister with a “resumé” of things to be accomplished were he to succeed that superior. Elliott was fired, it contends, because his region had not achieved the company’s desired market penetration or productivity, the undisputed fact being that the market penetration there (in Houston) was approximately five to six percent, as compared to the com- pany’s state-wide market penetration of twenty percent. As to the others, its contentions are as follows: Owens was terminated because it was believed that he did not have the necessary inner drive to lead his region and that his replacement would do a better job. The record reflects that during the three years preceding Spradley’s termina- tion he had been transferred into and out of a total of four different positions, with the final transfer, Manager of National Accounts, being a decided deraotion. Appel- lant urges that Spradley simply lacked the personality to deal with others in managerial positions and had demon- strated that he did not have the capabilities or desire to be Manager of National Accounts. Thompson was dis- missed because he had not developed a sales training pro- gram. The record reflects, and Thompson conceded, that the sales training program had “really been neglected,” but that he “was going to recommend changes” to “re- vitalize the program.” The reason stated for Tipton’s termination was that he had violated company policy by having a contractor who was remodeling his new regional offices leave out a wall, producing the twin effect of en- of discrimination). More, Schucany’s testimony concerning his sta- tistical model, as noted above, was that age could neither be ac- cepted nor rejected as the determinative factor in the discharges. 20a larging his personal office beyond the square footage permitted by the company for an officer of his rank and eliminating the employees’ lounge. It cannot be said that any of these reasons is irrational or idiosyncratic. To the contrary, each is, on its face, an adequate, nondiscriminatory one. See International Broth- erhood of Teamsters v. United States, 481 U.S. 324, 360 n.46, 97 S.Ct. 1843, 1867 n.46, 52 L.Ed.2d 396 (1977). Once such a reason for discharge is articulated by ade- quate evidence, the plaintiff’s established prima facie case is not necessarily sufficient to take the case to a jury. Reeves v. General Foods Corp., 682 F.2d 515, 521-23 (5th Cir. 1982). When no more evidence of discrimination is presented than that of these plaintiffs and the defendant presents evidence justifying and explaining the discharge, the trier of fact is not free to disregard that explanation without countervailing evidence that it was not the real reason for the discharge. Such evidence may take the form of an attempted showing that the reason given by the employer, though facially adequate, was untrue as a matter of fact or was, although true, a mere cover or pretext. Appellees offered no more than conclusionary state- ments of age discrimination. On cross-examination each admitted that he was never told that age was a factor in his discharge. When questioned directly concerning the company’s stated reasons for his dismissal, none seriously disputed either his awareness of or the objective truth of the company’s stated ground of dissatisfaction with him, maintaining only that it was inadequate to warrant his termination. Within certain limits, however, not ex- ceeded here, such judgments as that are for the em- ployer, not for the court. As we have noted, the statistical evidence was equivocal. Pretext was not made out, nor S > - = 7 : * * Ba 5 —"' eet. - 8 1 es F * * * os 2 „ ͤè A es ae OR a Oe 21a McDonnell Douglas is not a vehicle that permits a plaintiff to cast the burden of persuasion on the defendant and compel him to prove that his actions were non- discriminatory. See Sweeney v. Board of Trustees of Keene State College, 439 U.S. 24, 99 S.Ct. 295, 58 L.Ed.2d 216 (1978). Nor is it a device which permits the jury to examine an employer’s reasons for discharge and deter- mine that the employer’s business judgment or policies do not appeal to its sensibilities. The inquiry is whether the plaintiff has been discriminated against because of his age; the ADEA proscribes no other conduct. The record in this case establishes that the plaintiff- appellees were in the ADEA’s protected age group, that most were qualified, and that they were terminated and (except for one) replaced by younger employees. It carries the plaintiffs no further. Group Hospital offered an adequate ground other than age for the discharge of each. In rebuttal, each appellee advanced little if any- thing more than his belief that age caused his discharge rather than the reason given by the employer. We are not prepared to hold that a subjective belief of discrimina- tion, however genuine, can be the basis of judicial relief. See Houser v. Sears, Roebuck & Co., 627 F.2d 756 (5th Hi . i ft 1 a i 22a versely where, as here, the reasons articulated are ra- tional ones, the objective truth of which is not seriously disputed, the burden of establishing them as pretextual is a heavy one indeed. As we have heretofore held in Houser, supra, it is not discharged by general avowals of belief, however sincere, that age—rather than an estab- lished adequate reason—was the real reason for the termination. More is required, perhaps a successful sta- tistical demonstration by expert testimony, perhaps proof that others similarly situated were not discharged. Such proof is lacking here; and as to this, the verdict lacks rational support in the record. Since it does, and since the element of pretext was critical, the verdict cannot stand. Because we hold that the evidence was insufficient to support the jury’s finding of age discrimination we need not address the issues of attorneys’ fees, liquidated dam- ages or the supersedeas bond. We leave it to the district court to fashion a decision consistent with this opinion. Accordingly, the judgment of the district court is reversed and the cause remanded. REVERSED and REMANDED. 23a IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT [Caption Omitted in Printing] ON PETITION FOR REHEARING AND SUGGESTION FOR REHEARING EN BANC (Opinion 9-16-83, 5 Cir., 198—, —— F.2d ——) (November 25, 1983) Before THORNBERRY, GEE and REAVLEY, Circuit Judges. PER CURIAM: The Petition for Rehearing is DENIED and no mem- ber of this panel nor Judge in regular active service on the Court having requested that the Court be polled on rehearing en banc, (Federal Rules of Appellate Procedure and Local Rule 35) the Suggestion for Rehearing En Banc is DENIED. ENTERED FOR THE COURT: /s/ Thomas Gibbs Gee United States Circuit Judge 24a IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION Civil Action No. H-79-2179 JACK ELLIOTT, et al. vs. GROUN HOSPITAL SERVICE, INC., et al. FINAL JUDGMENT On the first day of July 1981, came to be heard the above-styled and numbered cause, and all parties having announced ready for trial, a jury was drawn and im- paneled, and after the jury was sworn, evidence was in- troduced by Plaintiffs. When Plaintiffs rested, the De- fendants, Group Medical and Surgical Service, Inc., and Group Life & Health Insurance Company moved that the Plaintiffs’ cause of action against them be dismissed. The motion was granted. Defendant, Group Hospital Service, Inc., introduced evidence and then Plaintiffs introduced evidence in rebuttal. The Court finds that Plaintiffs Eliott and Galen timely filed their notice of intent to sue, Delaware State College v. Ricks, —— US. ——, 101 S.Ct. 498 (1980) ; Payne v. Crane Co., 560 F.2d 198 (5th Cir. 1977), and that Plaintiff Heffer also timely filed his notice of intent to sue. Charlier v. S.C. John- son & Son, Inc., 556 F.2d 761 (5th Cir. 1977). The issues in the case were submitted to the jury upon Special Verdicts which were answered by the jury as follows: 1. Do you find from a preponderance of the evidence that the Defendant discriminated against the following Plaintiffs by discharging them from their employment on the basis of age? 25a Answer “Yes” or No.“ (1) Jack Elliott Answer: Yes (2) Richard Galen Answer: Yes (3) Max Tipton Answer: Yes (4) George “Don” Spradley Answer: Yes (5) Duane Thompson Answer: Yes (6) Robert Heffer Answer: Yes For each Plaintiff for whom you have answered “Yes,” answer questions 2 and 3. 2. What sum of money do you find from a preponder- ance of the evidence will compensate each Plaintiff for the economic losses he has incurred? Answer in dollars and cents. (1) Jack Elliott Answer: $262,814 (2) Richard Galen Answer: $191,967 (3) Max Tipton Answer: $208,175 (4) George “Don” Spradley Answer: $102,689 (5) Duane Thompson Answer: $ 59,357 (6) Robert Heffer Answer: $205,682 8. Do you find from a preponderance of the evidence that the discharge of the following Plaintiffs was “will- ful.“ Answer “Yes” or No.“ (1) Jack Elliott Answer: Yes (2) Richard Galen Answer: Yes (3) Max Tipton Answer: Yes (4) George “Don” Spradley Answer: Yes (5) Duane Thompson Answer: Yes (6) Robert Heffer Answer: Yes 4. Do you find from a preponderance of the evidence that the Defendant failed to post the required notice 26a about the Age Discrimination in Employment Act at Robert Heffer’s place of employment—that is, at the Houston District office? Answer “Yes” nor “No.” Answer: Yes The Special Verdict Form was dated July 8, 1981, and signed by the foreperson, Harold C. Chevalier. The Court having received the verdict of the jury and having considered the jury’s answers to the Special Ver- dict Form, the Court concludes that the Plaintiffs are entitled to have judgment against Group Hospital. Serv- ice, Inc., and that the Plaintiffs are entitled to an award of attorneys’ fees and expenses. The parties have stipu- lated that the Court would determine the amount of the attorneys’ fee award upon fee petition submitted by Plaintiffs’ counsel, and the Court having considered the fee petition in light of the standards set forth in Johnson v. Georgia Highway Express, 488 F.2d 714 (5th Cir. 1974), is of the opinion that Plaintiffs are entitled to an award of attorneys’ fees and expenses in the amount of $96,607.50 as fees and $5,494.55 as expenses, on the basis of the information contained in the affidavits sub- mitted by Plaintiffs’ counsel. The Court in its discretion, declines to award liqui- dated damages to the Plaintiffs. Hays v. Republic Steel Corp., 581 F.2d 1307 (5th Cir. 1976). IT IS THEREFORE ORDERED, ADJUDGED and DECREED by the Court as follows: (1) Plaintiffs do have judgment for and recover from the Defendant, Group Hospital Service, Inc., the following sums: Jack Elliott $262,814 Richard Galen $191,967 Max Tipton $208,175 George “Don” Spradley $102,689 Duane Thompson $ 59,357 Robert Heffer $205,632 27a (2) Plaintiffs do have judgment for and recover from the Defendant, Group Hospital Service, Inc., reasonable attorneys’ fees in the amount of $96,607.50, plus reason- able expenses in the amount of $5,494.55. (3) Costs of Court are taxed against Defendant, Group Hospital Service, Inc. (4) All Plaintiffs’ causes of actions against Defend- ants, Group Medical and Surgical Service, Inc., and Group Life & Health Insurance Company are dismissed with prejudice. (5) The total amount of the judgment, including the Plaintiffs’ recoveries and attorneys’ fees and expenses shall bear interest at the legal rate from the date hereof until paid in full. (6) None of the Plaintiffs shall be reinstated. (7) For recovery of which amounts, let execution issue if this judgment is not timely paid. SIGNED and ENTERED this 20th day of July 1981. /s/ George E. Cire GEORGE E. CIRE United States District Judge 28a IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION [Caption Omitted in Printing] ORDER [DENYING MOTION FOR JUDGMENT N. O. V.] Before the Court is Defendant’s Motion for Judgment n. o. v. and the Court has reviewed all the grounds and legal arguments advanced by Defendant. Because the Court holds that the evidence presented at trial of this case was of such quality and weight that reasonable and fair-minded persons in the exercise of impartial judgment might reach different conclusions, the Defendant’s mo- tion should be denied. It is therefore ORDERED that Defendant’s motion for judgment n. o. v. be, and it is hereby, DENIED. SIGNED and ENTERED this 20 day of July 1981. /s/ George E. Cire GEORGE E. CIRE United States District Judge IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF TEXAS HOUSTON DIVISION [Caption Omitted in Printing] ORDER [DENYING MOTION FOR NEW TRIAL] On July 20, 1981, this Court entered Final Judgment in this action, finding for the Plaintiffs against the De- fendant Group Hospital Services, Inc., and ordering that Defendant pay certain sums to the Plaintiffs in damages, court costs, and reasonable attorney’s fees. Plaintiffs then filed its motion to modify or amend the judgment and Defendant has moved for a new trial. After con- sidering these motions and the arguments of both parties, the Court has concluded that the Final Judgment of July 20, 1981, should stand and that the motions of each party should be DENIED. Accordingly, it is hereby ORDERED: (1) Plaintiffs’ motion to modify or amend the judg- ment is DENIED; (2) Defendant’s motion for a new trial is DENIED. SIGNED and ENTERED this Ist day of September 1981. /s/ George E. Cire GEORGE E. CIRE United States District Judge 80a SUPREME COURT OF THE UNITED STATES No. A-647 JACK ELLIOTT, et al., Petitioners, v. GROUP MEDICAL & SURGICAL SERVICE, IN c., et al. and GrouP HosPITAL SERVICE, INC. ORDER EXTENDING TIME TO FILE PETITION FOR WRIT OF CERTIORARI UPON CONSIDERATION of the application of counsel for petitioner (8), It Is ORDERED that the time for filing a petition for writ of certiorari in the above-entitled cause be, and the same is hereby, extended to and including March 17, 1984. /s/ Byron R. White Associate Justice of the Supreme Court of the | United States | Dated this 14th day of February, 1984. --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385011_1310%3A1. Public record. Not legal advice.