Strate v. Midwest Bankcentre, Inc.

• Decision Date: 17 February 2005
• Docket Number: No. 03-4039.,03-4039.
• Citation: 398 F.3d 1011
• Parties: Janet M. STRATE, Appellant, v. MIDWEST BANKCENTRE, INC., Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

398 F.3d 1011

Janet M. STRATE, Appellant, v. MIDWEST BANKCENTRE, INC., Appellee.

No. 03-4039.

United States Court of Appeals, Eighth Circuit.

Submitted: September 17, 2004.

Filed: February 17, 2005.

Mark G. Arnold, argued, St. Louis, MO, for appellant.

Howard K. Munson, argued, St. Louis, MO, for appellee.

Before MURPHY, McMILLIAN and BENTON, Circuit Judges.

MCMILLIAN, Circuit Judge.

Janet M. Strate appeals from a final order entered in the United States District Court for the Eastern District of Missouri granting summary judgment in favor of her former employer, Midwest Bankcentre, Inc., (the Bank), on her claims of unlawful employment discrimination and retaliation under the Americans with Disabilities Act (ADA), 42 U.S.C. § 12101 et seq., the Missouri Human Rights Act (MHRA), Mo.Rev.Stat. § 213.010 et seq., and the Employment Retirement Income Security Act (ERISA), 29 U.S.C. § 1000 et seq., among other statutes. Strate v. Midwest Bankcentre, Inc., No. 4:02-CV-219 (E.D.Mo. Nov. 14, 2003) (hereinafter "slip op."). For reversal, Strate argues that the district court erred in: (1) formulating the applicable legal standard under McDonnell Douglas v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973) (McDonnell Douglas), without incorporating a "modification" of that standard under Desert Palace, Inc. v. Costa, 539 U.S. 90, 123 S.Ct. 2148, 156 L.Ed.2d 84 (2003) (Desert Palace), and (2) applying the law to the evidence in the record on summary judgment. She contends that she established a genuine issue of material fact as to whether her relationship or association with her disabled newborn child was a motivating factor in the Bank's decision to eliminate her position and effectively terminate her employment. She argues that summary judgment was therefore improperly granted on several of her claims.¹ For the reasons discussed below, we affirm in part and reverse in part and remand the case to the district court for further proceedings consistent with this opinion.

Jurisdiction was proper in the district court based upon 28 U.S.C. §§ 1331, 1343. Jurisdiction is proper in this court based upon 28 U.S.C. § 1291. The notice of appeal was timely filed pursuant to Fed. R.App. P. 4(a).

Background

The following is a summary of the background facts as set forth in the district court's summary judgment order. Slip op. at 3-8. Strate began working for the Bank on June 18, 1990. She held the position of auditor until August 1997, when she was promoted to Senior Vice President (VP) of Operations and Information Systems. In December 1998, she was promoted to Executive VP of Retail Banking, Trust Services, and Human Resources. One month later, in January 1999, she became the Executive VP of Consumer Services and a member of the Bank's executive committee. In May of 2000, Strate became the Executive VP of Operations and Information Systems. Afterward, Tom Green and Paul Mahoney, the VPs of the Operations Department and Information Systems Department, reported directly to Strate, and Strate reported directly to Frank Ziegler, the Bank President.

In the latter part of 2000, the Bank hired an outside consultant, Tina Cherpes, to help improve customer services. Cherpes identified several problems at the Bank, such as unreconciled accounts and customer complaints. After identifying those problems, Cherpes was engaged by the Bank to help stabilize and reengineer the Operations Department.

Meanwhile, Strate had become pregnant. In the fall of 2000, she informed Ziegler and Jack Biggs, the Bank's Chairman of the Board, of her pregnancy. Strate was granted permission to take leave under the Family Medical Leave Act (FMLA). She began her FMLA leave on April 12, 2001. Before Strate went on leave, she expressed concern to Ziegler about her job. He told her "that she had been a good employee, that he had no reason to expect her job would not be there, and she should not be concerned." Id. at 5.

On April 20, 2001, Strate gave birth to her third child, who was born with Down's Syndrome. On April 24, 2001, Strate enrolled her newborn child in the Bank's group healthcare plan. On June 3, 2001, she notified Ziegler that she planned to return to work on July 2, 2001, but that she might require surgery due to her recent delivery.

On June 11, 2001, while Strate was on maternity leave, Ziegler discharged Green, purportedly in response to continuing problems within the Operations Department. Thereafter, the Operations Department was run by three people: Cherpes, the outside consultant; Sarina Strack, a bank employee; and another bank employee. The three worked under the direction of an executive steering committee at the Bank.

Around the same time, while Strate was still on leave for the birth of her child, Ziegler decided to eliminate her position. As the district court explained:

Ziegler concluded that the Operations and Information Systems Departments' leaders should report directly to him and become part of [the Bank's] Executive Management Team so as to improve communications. He determined that it was in [the Bank's] best interest to eliminate the layer of supervision or management between him and those two departments' VPs. As part of the stabilization project, the Operations Department was renamed "Customer Support Department." The VP of Customer Support would report directly to Ziegler. He decided to eliminate [Strate's] position and so informed Biggs.

Id. at 6.

Thereafter, following a meeting between Ziegler and Biggs, Biggs's assistant, Darla Clenin, overheard Biggs on the telephone saying, among other things, "Frank was going to handle it," "there's no more room in the barn for her," and "conscious of the disability." Id.

On June 25, 2001, the Bank externally advertised that it was looking to hire a VP of Customer Support.² The job opening was not posted internally. On June 29, 2001, Biggs sent an e-mail message to one of the Bank's board members discussing the management restructuring plan and favorably noting Strack's interest in the newly-created VP of Customer Support position. Biggs indicated that promoting Strack, while eliminating Strate, would result in a net savings for the Bank, even if Strack were given a raise. He further stated:

Janet Strate will return Monday. Frank is prepared to deal with this situation and advise Janet that her position is no longer here and that there is not a role that suits her given the directions now being taken. We are prepared to give her a fair exit and will counsel her accordingly. Frank is giving his approach serious thought so that we do not get in a sticky situation.

Id. at 7 (quoting Plaintiff's Deposition Exh. 3) (located in Joint Appendix (Vol.II) at 279).

When Strate returned to work on July 2, 2001, Ziegler told her that her position had been eliminated due to restructuring. He also told her that she could apply for the newly-created VP of Customer Support position, but the selection committee did not view her as a viable candidate for the job. He further stated that, if she did not apply for the new position, she could have a severance package which included eleven months of salary plus six months of continued healthcare coverage. Strate did not apply for the VP of Customer Support position and declined the severance package offered by Ziegler. Id. at 7-8.

The Bank interviewed two external candidates and one internal candidate, Strack, for the VP of Customer Support position. On July 18, 2001, Strack was promoted to that position, and, on November 20, 2001, she was promoted to Senior VP of Customer Service.

Strate received Right to Sue letters from the EEOC and the Missouri Commission on Human Rights on January 9, 2002, and February 1, 2002, respectively. On May 31, 2002, Strate filed the present action in the district court claiming, among other things, that the Bank's elimination of her position as Executive VP of Operations and Information Systems, which effectively terminated her employment, was motivated by discrimination or retaliation based upon her relationship or association with a disabled person, her newborn child, in violation of the ADA, the MHRA, and ERISA. The Bank moved for summary judgment. Shortly thereafter, the district court denied the Bank's summary judgment motion without prejudice and ordered the parties to file supplemental briefs addressing the impact of the Supreme Court's then-recent decision in Desert Palace.

Desert Palace

In Desert Palace, the plaintiff sued her former employer in federal court alleging gender discrimination and sexual harassment in violation of Title VII. The action proceeded to trial only on the gender discrimination claim. At trial, notwithstanding the defendant's objection based upon the plaintiff's lack of direct evidence, the district court gave a mixed motive jury instruction incorporating legal standards established by Congress in the 1991 Civil Rights Act,³ which had been enacted in response to the Supreme Court's decision in Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S.Ct. 1775, 104 L.Ed.2d 268 (1989) (Price Waterhouse). Regarding liability, the district court noted that the jury had heard evidence of both lawful and unlawful motives for the defendant's adverse employment action and instructed the jury that the plaintiff was entitled to a favorable verdict on liability if the protected characteristic (gender) was a motivating factor in the adverse employment action, regardless of whether other lawful motives also played a role. On damages, the district court instructed the jury that the plaintiff was entitled to damages even if the adverse action was motivated by both gender and a lawful reason, unless the defendant had proven by a preponderance of the evidence that it would have taken the same adverse action if plaintiff's gender had played no role in the employment decision. Desert Palace, 539 U.S. at 96-97, 123 S.Ct. 2148. The jury rendered a verdict for the plaintiff and awarded her back...