Kulumani v. Blue Cross Blue Shield Assoc.

• Decision Date: 22 August 2000
• Docket Number: Nos. 99-3001,s. 99-3001
• Citation: 224 F.3d 681
• Parties: (7th Cir. 2000) Sam Kulumani, Plaintiff-Appellant, v. Blue Cross Blue Shield Association, Defendant-Appellee. & 99-4133
• Court: U.S. Court of Appeals — Seventh Circuit

Page 681

224 F.3d 681 (7th Cir. 2000)

Sam Kulumani, Plaintiff-Appellant, v. Blue Cross Blue Shield Association, Defendant-Appellee.

Nos. 99-3001 & 99-4133

In the United States Court of Appeals For the Seventh Circuit

Argued May 10, 2000

Decided August 22, 2000

Rehearing and Rehearing En Banc Denied Sept. 19, 2000.^*

Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 97 C 5391--James F. Holderman, Judge. [Copyrighted Material Omitted]

Before Easterbrook and Rovner, Circuit Judges.^**

Easterbrook, Circuit Judge.

Blue Cross Blue Shield Association serves as a fiscal intermediary in the Medicare program, processing providers' claims for reimbursement from the federal fisc. Sam Kulumani worked in its Medicare unit as an accountant (a position called "consultant") between 1989 and 1997. Promoted once in 1993, Kulumani sought another promotion in 1996. This time he was turned down. Worse lay in store. Since 1994 the federal government has wanted more for less, and every year it reduced what it paid Blue Cross for claims-processing services. The Health Care Finance Administration, on whose behalf Blue Cross acts, told Blue Cross that its compensation for Medicare claims- handling work in fiscal 1997 (beginning October 1, 1996) would be about $1 million less than for fiscal 1996. Blue Cross decided that some employees had to go. Kulumani turned out to be one of those and was discharged in February 1997. In this suit under Title VII of the Civil Rights Act of 1964, 42 U.S.C. sec.sec. 2000e to 2000e- 17, Kulumani accuses Blue Cross of national- origin discrimination (his ancestors hale from India, and Kulumani himself took a law degree there) in both the nonpromotion decision and the discharge decision. The district judge granted summary judgment to Blue Cross, 1999 U.S. Dist. Lexis 11896 (N.D. Ill. July 27, 1999), concluding among other things that Kulumani did not have evidence calling into question Blue Cross's explanations for its actions: that no higher position was open in 1996, and that he was let go in 1997 as the weakest of Blue Cross's comparable employees.

We start with Kulumani's quest for a promotion. One of the reasons the district court gave--that losing an opportunity to be promoted is not an adverse job action and hence is not covered by Title VII--has been disapproved by an opinion released after the district court made its decision. See Hunt v. Markham, No. 99-1331 (7th Cir. July 11, 2000). But other grounds, including the lack of vacancies, support the judgment. Kulumani observes that several positions for which he was qualified were open toward the end of fiscal 1996, but none of these was filled. The only hiring or promotion into a Grade 13 position (the level Kulumani sought) during 1996 occurred in January; hiring and promotions later were frozen. Kulumani believes that he should have received the Grade 13 appointment in January 1996, but if this was the discriminatory act then Kulumani's charge of discrimination, filed in February 1997, was untimely. Only a failure to promote within the preceding 300 days could have been within the scope of the charge, but it is undisputed that no one was promoted to Grade 13 during those 10 months. Kulumani cannot show that Blue Cross's decision not to promote him was discriminatory; all aspirants for promotion were treated alike.

The existence of a budget crunch requiring staff trimming in fiscal 1997 likewise is undisputed. Kulumani contends, however, that Esther Peterson should have been released in his stead. The district court's opinion recounts the undisputed facts, so we can summarize. Blue Cross required its managers to pare their staffs using performance and seniority as benchmarks, but without any mechanical rule. Wilson Leong, the manager of the unit where Kulumani worked, was told that he and the heads of other units had to select three employees for layoff; Kulumani was not among the three on the unit directors' list. Kari Kronborg, Blue Cross's Director of Human Resources, decided to satisfy herself that the selections were prudent, and she eventually concluded that Kulumani should be dismissed instead of Peterson. Kulumani insists that Kronborg's intervention is suspicious, and that had Blue Cross followed its normal approach Peterson would be gone and he would still be employed.

Unusual yes, suspicious no. A Director of Human Resources who always went along with whatever proposals crossed her desk might as well be a doormat. Quality-control checks are prudent, and occasionally these lead to different decisions; that's what upper-level managers are there for. To show that Kronborg's intervention was a pretext for discrimination Kulumani needed to establish not that it was unusual but that the stated reason (quality control) was a fabrication, designed to conceal an unlawful reason. A "pretext for discrimination" means more than an unusual act; it means something worse than a business error; "pretext" means deceit used to cover one's tracks. See Reeves v. Sanderson Plumbing Products, Inc., 120 S. Ct. 2097, 2108-09 (2000). But of this Kulumani has no evidence--no statements by Kronborg, no disparate impact from managerial interventions, nothing except the raw fact that Kronborg stepped in.

Nor could the reasons Blue Cross gave for keeping Peterson over Kulumani be deemed a pretext for discrimination--not by a reasonable trier of fact, anyway. It is undisputed not only that seniority played a role in Blue Cross's selection of candidates for layoff but also that Peterson joined Blue Cross 20 years before Kulumani. The other factor was performance, and here Kulumani says that he and Peterson were tied: they had the same overall supervisory rating. If that is so, then seniority won out and Kulumani has no complaint.

What is more, we do not think that a reasonable trier of fact could conclude that Kronborg lied when she said that Kulumani and Peterson were not tied in performance assessments. Blue Cross rates its accountants on a four-level scale; the levels' names are bureaucratese, so we use numbers, where level 1 indicates...