47 F.3d 586 (3rd Cir. 1995), 93-1773, Miller v. CIGNA Corp.

Docket Nº:93-1773.
Citation:47 F.3d 586
Party Name:William J. MILLER, Appellant, v. CIGNA CORPORATION; The Insurance Company of North America.
Case Date:January 23, 1995
Court:United States Courts of Appeals, Court of Appeals for the Third Circuit

Page 586

47 F.3d 586 (3rd Cir. 1995)

William J. MILLER, Appellant,


CIGNA CORPORATION; The Insurance Company of North America.

No. 93-1773.

United States Court of Appeals, Third Circuit

January 23, 1995

Argued March 28, 1994.

Reargued In Banc Oct. 18, 1994.

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[Copyrighted Material Omitted]

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Stephanie A. Middleton (argued), Gregory B. Tobin, CIGNA Corp., Philadelphia, PA, for appellees CIGNA Corp. and Ins. Co. of North America.

Alice W. Ballard (argued), Lynn Malmgren, Samuel & Ballard, Philadelphia, PA, for appellant.

Robert J. Gregory, E.E.O.C., Washington, DC, for amicus appellant.

Argued March 28, 1994

Before: STAPLETON, HUTCHINSON and ROTH, Circuit Judges.

Reargued in banc October 18, 1994



STAPLETON, Circuit Judge:

This appeal is before the court for rehearing in banc to clarify the proper standard for a jury charge in a pretext case alleging age discrimination. 1

Defendant Insurance Company of North America ("INA") terminated plaintiff William J. Miller from his job after fifteen years of employment. 2 Miller alleges that he was discriminated against on the basis of his age in violation of the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. Secs. 621-34.

At trial, the district judge instructed the jury that it could return a verdict for Miller only if he proved that age was "the sole cause" of INA's decision. After the jury returned a verdict in INA's favor, Miller appealed, asserting that the district court improperly charged the jury regarding his burden of proof. We hold that in ADEA cases that do not qualify for a burden shifting charge under Price Waterhouse v. Hopkins, 490 U.S. 228, 109 S.Ct. 1775, 104 L.Ed.2d 268 (1989), district courts should instruct the jury that the plaintiff's burden is to prove that age played a role in the employer's decisionmaking process and that it had a determinative effect on the outcome of that process. Because Miller should not have been required to prove that age was the sole cause of INA's decision, we conclude that he is entitled to a new trial.

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Miller was hired in 1975 as an assistant to INA's Chief Financial Officer. In that position, he directed INA's reinsurance operations at the Newark Reinsurance Company, created a financial processing service center, and directed the production of summary financial documents. After serving as Vice President and Director of INA's Special Risk Facility, Miller was promoted to Senior Vice President, Field Operations. He created a new organization, managed a $200 million budget, and supervised over 8,000 employees. At this point in his career, Miller was compensated at pay grade sixty-one and his superior consistently evaluated his performance as exceeding expectations.

After his promotion to Senior Vice President, Miller was asked to join a special team of executives called IMPACT. IMPACT's mission was to identify major strategic issues and market strategies for INA's Property and Casualty Division. Caleb Fowler, Chief Financial Officer of the Property and Casualty Division, and Richard Hoag, then Chief of Human Resources, indicated that they would find Miller a permanent position at the conclusion of the project. When IMPACT concluded in late 1984, Miller was assigned to a special project on reinsurance collection.

Upon completing the special project on reinsurance collection, Miller was appointed to the position of Senior Vice President, Finance and Administration in the Underwriting Division. In this position, Miller managed four departments, handled complaints from agents and regulatory agencies, prepared state filings and annual budgets, and managed a $70 million annual budget.

In late 1988, Miller's supervisor, Jack Morrison, advised Miller that he should search for another job because his position might be eliminated. In March of 1989, Miller's new superior, Nord Bjorke, informed Miller that his position was eliminated and sent him to Richard Hoag to receive a special assignment reducing real estate costs in the Property and Casualty Division.

One year later, Hoag informed Miller that, despite his success in reducing real estate costs, his position as "real estate czar" was being terminated. Hoag advised Miller that he could assist Robert O'Neil, head of the Corporate Real Estate Department, with special projects. In November of 1990, Miller was informed that this position was being eliminated and that he would be terminated at the end of December. At the time he was terminated, Miller was fifty-eight years old and had been downgraded to pay grade fifty-nine. At no time during 1990 did company officials apprise Miller of five vacancies at the company for which he might have applied.

The first vacancy was for the position of Vice President, Filing and Regulation. The company announced that Darrell DeMoss, age forty-two, had been selected. Miller had not known of the position and contends that he was qualified for it because, as Senior Vice President, Finance and Administration, he supervised the Filing and Regulation function. INA asserts that Miller was not considered because the position required legal analysis and Richard Franklin, the hiring manager for this position, decided to hire an attorney. Miller notes, however, that his name was not included on the list of nonlawyer candidates who were considered but disqualified, and that the previous Vice President, Filing and Regulation, was not a lawyer.

The second vacancy was in the position of General Manager of CIGNA Reinsurance Company, United Kingdom. Among the desired qualifications were "[w]ork experience with either United Kingdom accounting practices or reinsurance accounting practices and principles." App. at 712. Miller asserts that this position involved the same responsibilities he had when he supervised the Newark Reinsurance Company. James Godorecci, who was in charge of hiring for the position, acknowledged that he wrote the job qualifications with Michael Durkin, age thirty-five, in mind and that he never considered Miller for the position. INA contends that Miller lacked the desired academic credentials, work experience, and knowledge of United Kingdom accounting practices, although Miller testified that when he expressed interest in the position, Godorecci's superior told Miller he was "over qualified." App. at 150.

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The third vacancy was for the position of Senior Vice President, Finance Systems and Administration, in the Claims Department. Qualifications desired for the position included: broad knowledge and experience in the property and casualty business; knowledge of financial measures and objectives; demonstrated credibility and the ability to work with other managers; skill in influencing managers and implementing strategy; and effective verbal and written skills. Miller contends he satisfied these requirements because of his management experience. James Engle, the hiring manager for this position, testified Miller was not qualified because he did not have a strong math and statistical background, was not familiar with loss control and statistical monitors, and lacked credibility among the actuaries. The company asserts that Victor DiFelice, age thirty-eight, was better qualified for the job.

The fourth vacancy, for the position of Head of Strategy Implementation, was filled by Ronald Peters, age forty-nine. The company conceded that Miller was qualified for the job, but maintained that Peters was better qualified. Although it was a temporary assignment, when his work in this position was completed Peters was retained by the company.

The fifth vacancy was for the position of Vice President, Property and Casualty Marketing. Hiring manager Thomas Cobb appointed Cynthia Cole-Dougherty, age thirty-eight. Job qualifications included an ability to conduct market studies, market research, competitive analyses, and segmentation studies. INA asserts that, although Cynthia Cole-Dougherty did not have insurance experience, one of the primary considerations in the hiring decision was a desire to hire from outside both the company and the industry.

The evidence at trial also focused on the nature of INA's hiring and promotion decisionmaking process. Human resource personnel testified about the company's formal placement process available for positions above pay grade fifty-four ("the 54 + placement process"). A department manager using the 54 + placement process would receive assistance from an assigned human resource contact who would act as the manager's agent within the company, helping to locate, sort through, and evaluate potential candidates for the position. Open positions above grade fifty-four were not publicly posted and a candidate could only access information about these openings through direct management contact. The 54 + placement process was not mandatory, however, and many of the managers who testified at trial explained that they had in fact filled their management vacancy through an informal process by assessing their own needs, reflecting on the qualifications of their staff members, and initiating contact with potential candidates directly. Richard Morrissey, director of human resources for CIGNA's property and casualty companies, also testified about the company's annual organizational review process through which department managers assess the qualifications, potential, and development needs of their staff with an eye toward identifying and developing future high level managers.

During trial, the district judge asked counsel if Miller's was a "pretext" or "mixed motives" case. This inquiry made reference to the distinction between employment discrimination cases in which the plaintiff seeks to carry his or her burden by showing that the...

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