Courtney v. Biosound, Inc.

Citation42 F.3d 414
Decision Date13 December 1994
Docket NumberNo. 93-3733,93-3733
Parties66 Fair Empl.Prac.Cas. (BNA) 971, 65 Empl. Prac. Dec. P 43,402 -Appellant, v. BIOSOUND, INC., Defendant-Appellee. United States Court of Appeals, Seventh Circuit
CourtUnited States Courts of Appeals. United States Court of Appeals (7th Circuit)

Raymond J. Hafsten, Jr. (argued), Michael J. Cork, Indianapolis, IN, for plaintiff-appellant.

Hudnall A. Pfeiffer, Todd M. Nierman (argued), Baker & Daniels, Indianapolis, IN, for defendant-appellee.

Before CUDAHY and MANION, Circuit Judges, and GORDON, District Judge. *

CUDAHY, Circuit Judge.

Robert G. Courtney brought this action against his former employer, Biosound, Inc., under the Age Discrimination in Employment Act (ADEA), 29 U.S.C. Sec. 626(c), alleging that Biosound failed to rehire him because of his age. The district court granted summary judgment in favor of Biosound, concluding that Courtney failed to produce evidence from which a finder of fact could reasonably conclude that the reasons proffered for the refusal to rehire were pretextual. We reverse and remand.

I. Background

Biosound markets ultrasound, cardiovascular imaging and electrocardiography equipment that is manufactured by its Italian parent corporation Esaote Biomedica (Esaote) and which is subject to classification and regulation by the Food and Drug Administration (FDA). Courtney began his employment with Biosound in 1979 when he was 49 years old. He was promoted to Manager of Quality Assurance and Regulatory Affairs sometime between 1981 and 1983. As for regulatory affairs, according to Biosound, Courtney was responsible for preparing, filing and maintaining submissions (such as 510(k) notifications) 1 to the FDA for the Class II ultrasound devices marketed by Biosound. 2 There is a dispute about whether Courtney was also responsible for Class III devices. 3

Courtney continued to work for Biosound when its ownership changed in January 1989, but was terminated 10 months later as part of a reduction in force. During the month prior to Courtney's termination, there were discussions among Biosound's executives about Courtney's age and health. When discussing Courtney's severance, the management asked Courtney to sign a general release, which included release of ADEA claims. Although Courtney claims that he was the only one asked to sign such a release, Biosound's then human resources manager could not recall whether other employees terminated in the reduction in force were asked to sign a release. Biosound eventually gave Courtney his severance payment without requiring him to sign the release.

After Courtney was terminated, Biosound's president, Gerald Richardson, took over the company's regulatory affairs. Richardson engaged Courtney as a regulatory consultant on several occasions during the eight to nine months following Courtney's termination. The last time was in August 1990 when one of Biosound's devices was impounded because of Biosound's failure to make a required FDA filing. Courtney's submission resolved the immediate problem but was rejected later by the FDA, which instructed Biosound to cease its introduction of the product in question. Biosound then engaged another outside consultant, William McKay, to complete the necessary submission to the FDA. Biosound continued to retain McKay, who then reviewed and reorganized the regulatory files created by Courtney.

In February 1991, Biosound took over the regulatory affairs work for all of Esaote's products. In this connection, Biosound solicited applications for the position of Manager of Regulatory Affairs. Biosound's president, Richardson, interviewed four candidates including Courtney, who was 61 years old at the time. Richardson selected one candidate, 28-year-old Wayne Nethercutt, to meet with other Biosound executives. Nethercutt has a biology degree and had worked with an orthopedic manufacturer as a clinical affairs specialist and coordinator for two and a half years. In addition to having some experience in filing 510(k) applications with the FDA, Nethercutt stated in his resume that he was familiar with regulations governing cardiovascular devices. Garrett, an executive who participated in Nethercutt's interviews, noted his impression of Nethercutt as, among other things, "young and [has] good growth potential." Biosound hired Nethercutt. Courtney filed this lawsuit, alleging that Biosound's failure to rehire him was motivated by his age. The district court granted summary judgment in favor of Biosound, and Courtney appeals.

II. Analysis

We review a grant of summary judgment de novo, Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986), viewing the record and the inferences drawn from it in the light most favorable to the non-moving party. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962). We will affirm if there is no genuine issue of material fact such that judgment is proper as a matter of law. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). The district court's decision is proper, "only if, had the record before that court been the record of a complete trial, the defendant would have been entitled to a directed verdict." Sarsha v. Sears, Roebuck & Co., 3 F.3d 1035, 1038 (7th Cir.1993); Billish v. City of Chicago, 989 F.2d 890, 892 (7th Cir.), cert. denied, --- U.S. ----, 114 S.Ct. 290, 126 L.Ed.2d 240 (1993). Where the party opposing a motion for summary judgment bears the burden of proof on an issue, he or she must affirmatively demonstrate, by specific factual allegations, that there is a genuine issue of material fact requiring trial. Sarsha, 3 F.3d at 1041. The nonmoving party's own affidavit or deposition can constitute affirmative evidence to defeat a summary judgment motion. Id.; Wilson v. Williams, 997 F.2d 348, 351 (7th Cir.1993). Further, the summary judgment standard is applied "with added rigor in employment discrimination cases, where intent and credibility are crucial issues." Robinson v. PPG Indus., Inc., 23 F.3d 1159, 1162 (7th Cir.1994) (quoting Sarsha, 3 F.3d at 1038). Because evidence directly supporting a claim of intentional discrimination is rare, affidavits and depositions must be carefully scrutinized for circumstantial proof which, if believed, would show discrimination.

In order to prove discrimination under the burden-shifting framework of McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973), which has been extended to ADEA cases, see Shager v. Upjohn Co., 913 F.2d 398, 400 (7th Cir.1990), the employee must first establish a prima facie case to create a rebuttable presumption of discrimination. The burden then shifts to the employer to articulate legitimate, nondiscriminatory reasons for the challenged employment action. Anderson v. Baxter Healthcare Corp., 13 F.3d 1120, 1122 (7th Cir.1994). If the employer is successful, the presumption dissolves, and the burden of production shifts back to the employee. Id. The employee bears the ultimate burden of proving that age was the determining factor in the employer's action. See Saint Mary's Honor Ctr. v. Hicks, --- U.S. ----, ---- - ----, 113 S.Ct. 2742, 2747-49, 125 L.Ed.2d 407 (1993). However, for purposes of defeating a summary judgment motion, the employee need only produce evidence from which a rational fact-finder could infer that the company's proffered reasons were pretextual. Anderson, 13 F.3d at 1124; Shager, 913 F.2d at 401; see also Visser v. Packer Eng'g Associates, Inc., 924 F.2d 655, 660 (7th Cir.1991) (en banc).

Because Biosound concedes on appeal that Courtney has established a prima facie case for age discrimination, the key inquiry here is whether Courtney has produced evidence from which a rational juror could infer that Biosound was untruthful about its proffered reasons for not rehiring Courtney. That is, whether Courtney has offered evidence showing either that a discriminatory reason more likely motivated Biosound's decision or that Biosound's proffered explanations are unworthy of credence. See Texas Dep't. of Community Affairs v. Burdine, 450 U.S. 248, 256, 101 S.Ct. 1089, 1095, 67 L.Ed.2d 207 (1981); Robinson, 23 F.3d at 1163; Oxman v. WLS-TV, 846 F.2d 448, 456 (7th Cir.1988); La Montagne v. American Convenience Prod., Inc., 750 F.2d 1405, 1409 (7th Cir.1984).

We agree with the district court that the first category of evidence on which Courtney has relied to establish pretext is insufficient. In proving that Biosound's adverse decision was more likely motivated by his age, Courtney relied on the following direct evidence: 1) Garrett's interview notes characterizing Nethercutt as being "young and [having] good growth potential;" 2) the discussions by the management of Courtney's age and health prior to Courtney's termination; 3) the fact that Courtney was asked to sign a release; and 4) a chart of Biosound's 1987-92 hirings, which supposedly shows that Biosound was reducing the composite age of its workers.

Garrett's remark as to Nethercutt's youth is not probative of Biosound's discriminatory intent not to hire Courtney. Garrett's interview notes of Nethercutt stated: "[g]ood discussion, speaks well, neat, shares a philosophy of 'team' approaches, seems to have a good grasp on FDA procedures. Seems well motivated--says he enjoys interaction with FDA, et cetera, on regulatory affairs matters.--Young, good growth potential--." Because "young" was grouped with "good growth potential," the notation could lead a reasonable fact-finder to infer that Garrett considered Nethercutt's youth as one of his positive attributes and that Garrett preferred a young candidate over an old one. Cf. Parker v. Federal National Mortgage Ass'n, 741 F.2d 975, 980 (7th Cir.1984) (statement that employee "was one of the younger members of the Regional staff who, with the others, comprise a strong asset base that portends well for the...

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