Johnson v. Minnesota Historical Soc.

• Decision Date: 25 April 1991
• Docket Number: No. 90-5233,90-5233
• Citation: 931 F.2d 1239
• Parties: 62 Fair Empl.Prac.Cas. 495, 56 Empl. Prac. Dec. P 40,839, 120 Lab.Cas. P 56,753 Loren JOHNSON, Appellant, v. MINNESOTA HISTORICAL SOCIETY, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 1239

931 F.2d 1239

62 Fair Empl.Prac.Cas. 495,

56 Empl. Prac. Dec. P 40,839,

120 Lab.Cas. P 56,753

Loren JOHNSON, Appellant, v. MINNESOTA HISTORICAL SOCIETY, Appellee.

No. 90-5233.

United States Court of Appeals Eighth Circuit.

Submitted Dec. 10, 1990.

Decided April 25, 1991.

Michael B. Chase, St. Paul, Minn., for appellant.

Michael Thomas Miller, Minneapolis, Minn., for appellee.

Before McMILLIAN, FAGG, Circuit Judges, and STROM, ^* District Judge.

STROM, District Judge.

Plaintiff Loren Johnson was employed by the Minnesota Historical Society to assist in the preservation, restoration, and renovation of historical sites. Plaintiff was discharged in 1986 and filed suit alleging that his termination violated the Age Discrimination in Employment Act, 29 U.S.C. Secs. 621-634 (1985); the Minnesota Human Rights Act, Minn.Stat. Secs. 363.01-363.15 (Supp.1991); and the Rehabilitation Act of 1973, 29 U.S.C. Sec. 794 (1985). Johnson further alleged that the Society breached an implied covenant to deal with him in good faith. The district court granted defendant's motion for summary judgment and dismissed plaintiff's claims concluding: (1) plaintiff had failed to establish that his job continued in existence after his dismissal; (2) plaintiff failed to establish a prima facie case of discrimination on the basis of age or disability; (3) even if plaintiff had established a prima facie case, the defendant's reduction in force for economic reasons constitutes a legitimate, nondiscriminatory reason for his discharge; and (4) Minnesota does not recognize a claim based on an implied covenant of good faith and fair dealing.

We affirm the dismissal of plaintiff's claim based on an implied covenant of good faith and fair dealing. However, we find plaintiff raised genuine issues of material fact concerning his age and disability claims and therefore vacate the dismissal of those claims and remand to the district court for further proceedings.

FACTS

Johnson was employed by the Minnesota Historical Society ("Society") to assist in the preservation, restoration, and reconstruction of historical sites in Minnesota. Johnson began employment with the Society on March 3, 1963, and was terminated effective January 1, 1986, at age fifty-four (54). At the time of his termination, Johnson had a thirty-five per cent (35%) permanent partial disability to his back as a result of a 1963 automobile accident, was nearly blind in one eye, had a cataract in the other eye, and suffered from glaucoma.

In the early 1980's, over thirty per cent (30%) of the Society's budget was funded by federal money. However, the federal government subsequently reduced funding for historical preservation and the Society now receives approximately five per cent (5%) of its funding from the federal government, twenty per cent (20%) from private donors, and seventy-five per cent (75%) from the state government. The Society alleges that as a result of decreased funding, it imposed a variety of measures to cut its budget beginning in 1981. In late 1985, the Society restructured its organization, altering the positions of about twenty employees and dismissing two individuals, Johnson and Albert Galbraith. The Society alleges that Johnson's position was eliminated because the decrease in funding nearly eliminated restoration work so Johnson's position was no longer needed. Johnson offered to continue working for the Society at fifty per cent (50%) of his prior salary. The Society alleges this offer was refused because there was no funding to support projects employing Johnson's area of expertise.

Johnson filed age discrimination charges with the Equal Employment Opportunity Commission and the Minnesota Department of Human Rights, but withdrew the charges prior to a determination. Johnson filed this action claiming that he was discriminated against in violation of the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. Secs. 621-634 (1985); the Minnesota Human Rights Act, Minn.Stat. Secs. 363.01-363.15 (Supp.1991); and the Rehabilitation Act of 1973, 29 U.S.C. Sec. 794 (1985). Johnson further claims that the Society breached an implied covenant to deal with him in good faith.

The district court granted summary judgment in favor of the Society and dismissed Johnson's discrimination claims. The district court held that Johnson had failed to produce sufficient evidence suggesting that his job, in its various parts, continued in existence after his dismissal. The Court further stated that, even viewing the comments and actions of Society employees in the light most favorable to Johnson, the evidence was insufficient to establish a prima facie case of age or disability discrimination on the record presented to the Court. Finally, even if Johnson had established a prima facie case of discrimination, the Society's reduction in force for economic reasons constituted a legitimate, nondiscriminatory reason for his discharge. This would shift the burden to Johnson to show that the reason was pretextual. Therefore, to avoid summary judgment, Johnson was required to show a genuine issue of material fact concerning the pretext which he did not do. The district court concluded that Johnson failed to provide substantial evidence that the Society acted with a discriminatory motive in discharging him because evidence relied on by Johnson did not contradict the nondiscriminatory reason for dismissal offered by the Society. The district court also granted summary judgment in favor of the Society dismissing Johnson's claim of an implied covenant of good faith and fair dealing. The court held that it was bound to follow Minnesota law and that the Minnesota appellate courts do not recognize such a claim. This appeal followed.

DISCUSSION

A. Discrimination Claims

The United States Supreme Court set forth guidelines to analyze discrimination claims in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). The guidelines set forth in McDonnell Douglas are applicable to cases arising under the ADEA, see Halsell v. Kimberly-Clark Corp., 683 F.2d 285, 289 (8th Cir.1982), cert. denied, 459 U.S. 1205, 103 S.Ct. 1194, 75 L.Ed.2d 438 (1983), and to cases arising under the Rehabilitation Act of 1973, see Johnson v. Legal Services of Arkansas, Inc., 813 F.2d 893, 896 (8th Cir.1987). To establish a prima facie case of age discrimination, the plaintiff must show that the defendant discharged him "under circumstances which gave rise to an inference of unlawful discrimination." Halsell, 683 F.2d at 289 (citing Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 253, 101 S.Ct. 1089, 1093, 67 L.Ed.2d 207 (1981)). Although the four criteria set forth in McDonnell Douglas provide one way of establishing a prima facie case of employment discrimination, the proof necessary will vary according to the circumstances of the case. Halsell, 683 F.2d at 289.

The ultimate question is whether the defendant intentionally discriminated against the plaintiff based on his age. See United States Postal Service Board of Governors v. Aikens, 460 U.S. 711, 715, 103 S.Ct. 1478, 1481, 75 L.Ed.2d 403 (1983). The plaintiff may prove his case by either direct or circumstantial evidence, the trier of fact considering all the evidence giving it whatever weight and credence it deserves. Id. at 714 n. 3, 103 S.Ct. at 1481 n. 3. Once the plaintiff sets forth a prima facie case and the defendant responds by offering evidence of a non-discriminatory reason, the plaintiff may then rely on his prima facie case or go further and attempt to show the defendant's reasons were pretextual. Hillebrand v. M-Tron Indus., Inc., 827 F.2d 363, 365 (8th Cir.1987), cert. denied, 488 U.S. 1004, 109 S.Ct. 782, 102 L.Ed.2d 774 (1989). The trier of fact must then decide whether the rejection was discriminatory. Aikens, 460 U.S. at 714-15, 103 S.Ct. at 1481.

This Court considered the prima facie elements in a reduction-in-force case in Leichihman v. Pickwick Int'l, 814 F.2d 1263 (8th Cir.), cert. denied, 484 U.S. 855, 108 S.Ct. 161, 98 L.Ed.2d 116 (1987). In Leichihman, the plaintiff contended that his position was eliminated and he was fired while the defendant Pickwick International retained a younger employee to perform his duties. Therefore, because the plaintiff did not allege that a younger person was hired to replace him, the plaintiff was required to meet the following five elements to establish a prima facie case of age discrimination:

(1) He was between 40 and 70 years old at the time of his termination; ¹

(2) He was performing his job at a level that met the defendant's legitimate expectations;

(3) Despite his performance in his job, he was terminated (4) His job in its various parts continued in existence;

(5) His age was a determining factor in the defendant's actions.

Id. at 1268. The Court stated that the basis of plaintiff's claim required that he show that the defendant had some continuing need for his skills and services in that his various duties were still being performed. While the elements for a prima facie showing will necessarily vary to fit the particular factual controversy, any modification of the prima facie case must still require the plaintiff to create an inference of a discriminatory reason for his termination. Id. at 1269. The Court recognized that to establish a prima facie case "[i]t is possible that in some circumstances the showing that age was a determining factor in the employer's action will be sufficient, and the plaintiff need not show that his position continued to exist." Id. at 1270.

In Holley v. Sanyo Mfg., Inc., 771 F.2d 1161 (8th Cir.1985), the defendant instituted a plant-wide reduction-in-force plan. The plaintiff was discharged after his position was combined with that of a younger employee and the younger employee given the new job. The Court recognized that proof that the plaintiff's position remained open until it was filled by a younger...