Court: Court of Appeals for the Sixth Circuit; January 1, 2002; Federal Appellate Court
Plaintiffs Thomas and Marlene Cicero appeal a district court order that granted summary judgment to Defendant Borg-Warner Automotive, dismissing Thomas Cicero’s age discrimination claim under Michigan’s Elliott-Larsen Civil Rights Act and Marlene Cicero’s derivative loss of consortium claim. The district court determined that Thomas Cicero failed to establish a prima facie case of age discrimination, specifically finding he was not qualified for his position as human resources manager. The Ciceros argue this was an error, claiming the court misapplied the McDonnell Douglas framework for discrimination cases. They contend that Cicero did demonstrate qualification for his job and assert that Borg-Warner provided a nondiscriminatory reason for his termination, necessitating a review of whether this justification was merely a pretext. The case originated in the Wayne County Circuit Court and was removed to the U.S. District Court under diversity jurisdiction. The district court utilized the McDonnell Douglas-Burdine test, which requires plaintiffs to show membership in a protected class, qualification for the job, adverse employment action, and that they were replaced by someone outside the protected class or treated less favorably than similarly situated individuals not in their class.
The district court granted summary judgment in favor of Borg-Warner, concluding that Cicero failed to establish a prima facie case of age discrimination, as he did not demonstrate that he was qualified for his position. The court did not address whether Cicero's replacement was substantially younger, which could have supported a claim of discrimination. In obiter dictum, the court indicated that even if a prima facie case had been established, Borg-Warner provided a legitimate, nondiscriminatory reason for Cicero’s termination, which Cicero did not prove to be a pretext for discrimination.
Cicero, who began working for Federal Mogul in 1994 and was retained by Borg-Warner in 1995 after its acquisition of the Forged Products Division, was terminated on November 20, 1997, along with other management staff. He alleged that the termination was due to his age, while Borg-Warner asserted that it was for unrelated reasons. The appellate court reviews the district court’s summary judgment de novo, adhering to the same legal standards. The McDonnell Douglas framework governs the analysis of the age discrimination claim under Michigan’s Elliott-Larson Civil Rights Act, necessitating that the plaintiff first establish a prima facie case, after which the burden shifts to the defendant to provide a legitimate reason for the discharge, and finally, the plaintiff must demonstrate that this reason is a pretext for discrimination. The district court concluded that Cicero did not meet the requisite burden at any stage, thus upholding the summary judgment.
The district court granted summary judgment for the defendants, concluding that Cicero did not establish a prima facie case of age discrimination. The court incorrectly conflated the stages of the McDonnell Douglas framework and imposed an excessive burden on Cicero. The prima facie standard for discrimination is not severe, and Cicero satisfied the necessary elements. Specifically, to prove age discrimination, a plaintiff must demonstrate that they belong to a protected class, experienced an adverse employment action, were qualified for the position, and were replaced by a younger individual. Cicero met the first two criteria: he was over forty and was terminated, an adverse action.
The defendants contested Cicero's qualifications and the claim that he was replaced by a significantly younger person. While the district court chose not to evaluate the latter, it based its ruling on Cicero's purported lack of qualifications. However, Cicero presented sufficient evidence to meet the qualifications element. The court emphasized that an employee is deemed qualified if they meet their employer’s legitimate expectations, and must assess qualifications independently from the employer’s nondiscriminatory rationale for discharge. The district court erred by not evaluating Cicero's qualifications based on this standard and by merging the different stages of the McDonnell Douglas analysis.
Cicero’s qualifications were improperly evaluated by the district court, which used Borg-Warner’s discharge justification as evidence against his qualifications, rather than considering it at the prima facie stage as part of the McDonnell Douglas analysis. Independent of Borg-Warner’s rationale, Cicero presented adequate evidence for a reasonable jury to determine he was qualified. Prior to Borg-Warner, Cicero served as the human resources manager for Federal Mogul’s Forged Products Division, overseeing HR management at multiple plants and receiving favorable evaluations from his supervisor, Larry Finnell. His notable prior experience includes roles at the Detroit Newspaper Agency and the Detroit Free Press, where he advanced through various HR positions. At Federal Mogul, Cicero received a significant merit bonus and positive performance reviews. After Borg-Warner acquired Federal Mogul, Cicero became the division human resources manager and continued to achieve merit and Management Incentive Plan (MIP) bonuses, which aimed to attract and retain competent individuals. He consistently received merit increases and positive feedback from Borg-Warner management, indicating that he met and exceeded job expectations.
In 1995, general manager Finnell awarded Cicero a positive performance evaluation, giving him an overall score of "6," indicating he exceeded job requirements, despite ranking him lower in one category. In 1996, Finnell praised Cicero's "outstanding" performance in the Gallipolis negotiations and expressed gratitude in a letter. Borg-Warner president Welding reinforced this praise in an email acknowledging the efforts of those involved. Evidence presented indicates Cicero was recognized as a key management employee in a retention plan during the sale of the Romulus Connecting Rod Business and consistently received bonuses and management praise.
This strong performance evidence supports Cicero's qualifications for his position, countering the defendants' claims. The management’s later complaints about Cicero's performance were not documented at the time and lacked warnings. These belated complaints should not be considered at the prima facie stage of the McDonnell Douglas test, which assesses employment discrimination claims. The district court, by analyzing the defendants' evidence of Cicero’s alleged poor performance at the prima facie stage, misapplied the legal standard, as established by precedent. Ultimately, Cicero provided sufficient evidence to meet his prima facie burden, and any disputes regarding the facts necessitate a factual determination by a jury.
Defendants contest Cicero's qualifications, asserting his poor performance renders him unqualified. However, such performance-related concerns are only relevant during later stages of the McDonnell Douglas test, not at the prima facie stage. Sufficient evidence indicates Cicero was qualified, and the district court's ruling was erroneous. Regarding age discrimination, the McDonnell Douglas test necessitates that an employee's replacement be younger; the court did not address whether Cicero's replacement met this requirement. Cicero was 51 when terminated, and his replacement was 43, leaving a factual question on whether this age difference satisfies the prima facie case criteria.
Upon establishing a prima facie case, a presumption of discrimination arises, which the defendant can rebut by providing legitimate, nondiscriminatory reasons for termination. The district court granted summary judgment for the defendants, asserting Cicero failed to establish this case but acknowledged that if he had, the defendants would have rebutted it. The defendants claimed Cicero's subpar performance justified his termination, supported by testimonies from management. This rationale is deemed a legitimate, nondiscriminatory reason.
However, the district court incorrectly concluded that Cicero could not counter the defendants’ justification. Cicero provided sufficient evidence to raise a genuine issue regarding whether the reason for his termination was a pretext for discrimination.
The Supreme Court of Michigan and most federal appellate courts utilize an "intermediate position" for summary judgment in employment discrimination claims under the Michigan Civil Rights Act. To contest a summary judgment motion regarding pretext, Cicero must demonstrate one of three elements: (1) the proffered reason lacks factual basis, (2) it did not motivate the action, or (3) it was insufficient to motivate the action. Evidence showing that the proffered reasons are unfounded or inadequate can imply discrimination. Conversely, if Cicero relies on prima facie evidence, he must present additional evidence of discrimination to substantiate his claim.
Cicero has presented sufficient evidence to suggest that age discrimination influenced Borg-Warner's decision to terminate him, countering their assertion of poor performance. His qualifications, absence of performance criticisms, and continued bonuses challenge Borg-Warner's rationale. Following Borg-Warner's acquisition of the Forged Products Division, Cicero became the human resources manager. He was tasked with integrating Borg-Warner's benefits into the new organization, a role he is accused of inadequately executing. Additionally, Borg-Warner claims Cicero was fired for hiring outside legal counsel without approval, citing a corporate memorandum that advised against such actions.
In August 1995, Borg-Warner faced litigation and allowed Cicero to hire outside counsel while the legal department monitored the case. By August 1996, a memo was issued requiring notification for using outside counsel in specific situations. In October 1997, Cicero hired outside counsel again without approval. Borg-Warner claimed Cicero was terminated partly due to his handling of labor negotiations at the Gallipolis plant, where he had previously received praise from management for his performance. Despite Borg-Warner's assertion of Cicero’s inadequacies, he was awarded multiple bonuses during his tenure, including a $15,840 MIP bonus and a merit increase in December 1995, along with continued bonuses into 1996. The defendants contended that bonuses were based on team performance, contradicting the bonus plan terms that emphasized individual performance. Notably, Cicero received full bonuses while another employee, John LeBlanc, was penalized for poor performance. In February 1997, despite intentions to fire Cicero and the management team, Borg-Warner authorized Cicero’s bonuses. A memo from October 1997 identified Cicero as a key employee to retain during a business sale. On November 20, 1997, Borg-Warner terminated Cicero and several others, all aged fifty-one or older, replacing them with younger staff. Cicero asserts that the reasons given for his termination were untrue.
Borg-Warner's stated reason for firing Cicero was poor performance; however, there is a lack of contemporaneous evidence supporting this claim. Prior to his discharge, Cicero was consistently praised for his work and received performance bonuses, with serious complaints about his performance only surfacing after his termination. This timing and the shifting reasons for his dismissal suggest a potential pretext for discrimination. John Fiedler, the president of Borg-Warner, indicated that the firings were part of a plan to create a "Borg-Warner team," without attributing the decision to Cicero's performance. Furthermore, during the litigation, Borg-Warner's justifications continued to evolve, raising questions about their credibility. Cicero also presented statistical evidence concerning other terminated employees, which, while not direct evidence of discrimination, serves as circumstantial evidence that may suggest discriminatory motives. The court noted that even small statistical samples could enhance the plausibility of discriminatory intent, contrasting with the district court's earlier analysis.
Cicero's statistics indicate a consistent pattern of hiring and firing practices by the defendants that negatively impacted older employees, suggesting that the rationale for Cicero's dismissal may be a pretext for discrimination. The district court's summary judgment in favor of the defendants was erroneous. Regarding Marlene Cicero's loss of consortium claim, the court dismissed it as derivative, contingent on the failure of Thomas Cicero's claim. Since the age discrimination claim was found to have merit, the dismissal of Marlene's claim was reversed.
Thomas Cicero demonstrated sufficient qualifications and satisfactory performance to challenge the summary judgment, supported by merit increases, bonuses, and positive evaluations. Despite the defendants' claims of dissatisfaction with Cicero's performance, they lacked written documentation or substantial evidence of poor performance, failing to provide timely warnings or critiques. Cicero's evidence creates a genuine issue of material fact regarding the defendants' motives for his termination, suggesting discrimination.
The court emphasized the necessity of resolving factual disputes favorably towards Cicero and noted that the district court misapplied the standard for demonstrating a prima facie case of discrimination. The legal precedent established in Manzer indicates that additional evidence of discrimination is only required when the plaintiff does not factually dispute the reasons given for dismissal. The Borg-Warner Management Incentive Bonus Plan aims to attract and retain competent individuals and incentivize performance among key employees.
The Board reserves the right to deny incentive awards to participants who meet performance criteria but are deemed to have underperformed based on management's recommendations. Gary Fukayama served as president of Borg-Warner from October 1994 until December 1995. At termination, Cicero, Finnell, Knaus, Malen, and Bruno were aged 51, 53, 51, 51, and 58, respectively, while Karen Schumann was 48. David Hall, Bruce Morehouse, Ronald Hundzinski, and David Pottinger replaced Cicero, Finnell, Knaus, and Malen at ages 43, 44, 39, and 50, respectively. The management team, as defined by Welding, included eight members, of whom three (Cicero, Finnell, and Malen) were fired, along with Knaus, who was not officially part of the team. The district court referenced multiple cases that challenge the plaintiffs' statistical evidence due to its limited sample size. However, these cases can be distinguished from the current situation, including Abbott v. Fed. Forge, Inc. and others, which pertain to disparate impact or reduction in force cases, not directly applicable to age discrimination under the McDonnell Douglas framework.
