Melendez-Arroyo v. Cutler-Hammer

• Decision Date: 05 September 2001
• Docket Number: P,MELENDEZ-ARROY,No. 00-2594,01-1015,CUTLER-HAMMER,00-2594
• Citation: 273 F.3d 30
• Parties: (1st Cir. 2001) IVYlaintiff, Appellant/Cross-Appellee, v.DE P.R. CO., INC., Defendant, Appellee/Cross-Appellant. Heard
• Court: U.S. Court of Appeals — First Circuit

Page 30

273 F.3d 30 (1st Cir. 2001)

IVY MELENDEZ-ARROYO, Plaintiff, Appellant/Cross-Appellee, v. CUTLER-HAMMER DE P.R. CO., INC., Defendant, Appellee/Cross-Appellant.

No. 00-2594, 01-1015

United States Court of Appeals For the First Circuit

Heard Sept. 5, 2001

Decided December 5, 2001

APPEALS FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO

[Hon. Jaime Pieras, Jr., Senior U.S. District Judge] Judith Berkan with whom Mary Jo Mendez and Del Toro & Santana were on consolidated brief for plaintiff.

Russell A. Del Toro with whom Roberto Santana-Aparicio and Del Toro & Santana were on consolidated brief for defendant.

Before Boudin, Chief Judge, Cyr, Senior Circuit Judge, and Lynch, Circuit Judge.

BOUDIN, Chief Judge.

Ivy Melendez brought suit against her employer, Cutler-Hammer de Puerto Rico ("Cutler-Hammer"), under the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. §§ 621-634 (1994), and under Puerto Rico law. Following discovery, the district court granted Cutler-Hammer's motion for summary judgment on the merits, and Melendez now appeals. Cutler-Hammer cross appeals to contest the district court's denial of its own summary judgment motion which sought a ruling that Melendez's suit was time-barred.

Melendez began working for Westinghouse in 1968 and until 1998 held a succession of accounting-related positions with the company and its successor in interest, Cutler-Hammer. In 1984, she became the accounting manager at the Toa Baja plant in Puerto Rico, a large facility with over 1,000 employees. In this position, she had broad responsibility for financial record keeping and analysis. Her direct supervisor, from 1983 to 1989, and again from 1993 to February 1997, was Larry Cancel, the controller at the plant.

In January 1994, Eaton Corporation acquired the plant from Westinghouse and began to operate it as Cutler-Hammer de Puerto Rico Company. Eaton then instituted new accounting programs for its new Puerto Rico plant; the new accounting system, tied in with Eaton's mainland operations, was in certain respects more complex than the Westinghouse system. Melendez continued as accounting manager after the acquisition but, in her later-filed lawsuit, she claimed that Cancel--from 1995 through 1997--made a number of adverse comments about her age and those of other employees with whom she worked. In l996, Melendez complained to the company's personnel department about Cancel, but the company took no action against him.

On February 14, 1997, Cancel, together with Luis Pizarro, the plant's human resources manager, met with Melendez and informed her that she would no longer be the accounting manager and would be transferred to a new position. According to Melendez, she understood that she was being demoted but was not told until May 1997 what her new responsibilities would be. In May she discovered that her new duties were fairly menial and involved no supervisory responsibility. However, incident to the February 1997 transfer, Melendez was given a 3 percent pay raise.

Almost immediately after the meeting, Melendez suffered serious depression and went on sick leave, which occupied a substantial portion of the time until May. She returned to work on May 12, 1997, and continued until November 6, 1997, when her mother was hospitalized with a serious illness. Her mother died on November 25, 1997. Melendez's depressive symptoms then became substantially worse. Although she attempted to return to work in January 1998, she required further treatment and in August 1998, the Social Security Administration found her disabled retroactive to November 6, 1997.

On or about March 4, 1998, Melendez filed an age discrimination charge with the Puerto Rico Department of Labor and the Equal Employment Opportunity Commission. After receiving right to sue letters from both agencies, Melendez brought suit in the district court, claiming that she had suffered an adverse job action because of age discrimination. Cutler-Hammer countered by arguing that the lawsuit was time-barred because the administrative charges were filed 383 days after the February 14, 1997, meeting despite a statutory requirement that the charges be filed within 300 days. 29 U.S.C. § 626(d); American Airlines, Inc. v. Cardoza-Rodriguez, 133 F.3d 111, 122 (1st Cir. 1998).

On February 29, 2000, the district court rejected Cutler-Hammer's motion for summary judgment on limitations grounds. The court found that factual issues precluding summary judgment were raised by two arguments offered by Melendez to avoid the limitations bar: that her claim did not accrue until May 1997, when the scope of her new duties became clear and, in the alternative, that equitable tolling was justified because her substantial depression warranted a suspension of the statute of limitations.

In September 2000, Cutler-Hammer filed a second summary judgment motion, this one directed to the merits. On November 21, 2000, the district judge granted summary judgment in favor of Cutler-Hammer, dismissing the federal claim on the merits and the Puerto Rico law claim without prejudice. In a nutshell, the district judge found that Melendez had failed to counter Cancel's deposition testimony that she had not met the company's job expectations; alternatively, the district court said that Melendez had failed to show that she was constructively discharged by Cutler-Hammer. Melendez has appealed from this decision, and Cutler-Hammer has filed a cross-appeal on the limitations issue.

1. The pertinent provision of ADEA is comparatively straightforward: it is unlawful for an employer to refuse to hire, or to discharge or to "otherwise discriminate" against any individual with respect to "compensation, terms, conditions, or privileges of employment, because of such individual's age." 29 U.S.C. § 623(a)(1). Protection is limited to those 40 years old or older, id. at § 631(a); Melendez was 56 years old as of February 1997. An applicant or employee who is aggrieved by an adverse job action taken against him or her because of age can bring a civil action under ADEA and can seek legal or equitable relief. Id. at § 626(c)(1).

To prevail on her federal claim of discriminatory treatment, Melendez had to show that she suffered an adverse job action, that this was motivated by age, and that she suffered injury as a result of it. See Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 141 (2000). If she proved this, her employer could still avoid liability by showing that it also had legitimate grounds for its action that would have led to the same result (a so-called dual motive case). Febres v. Challenger Caribbean Corp., 214 F.3d 57, 60 (1st Cir. 2000). By contrast, under Title VII such a showing would merely limit the relief available to the plaintiff. 42 U.S.C. § 2000e-5(g)(2)(B).

We start with the issue of motivation. Quite commonly in discrimination cases--especially in hiring--the potential plaintiff knows only that he was not hired and has no specific evidence as to why this occurred. Possibly in response to this dilemma, the Supreme Court in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973), adopted what it called a prima facie case approach by which an employer charged with racial discrimination in hiring could be made to explain its purported reason for its refusal to hire the plaintiff.

In substance, the Court said that the potential employee need at the outset show only that he or she met these conditions: that he or she was a racial minority, applied for and was qualified for the position, was rejected and that the position remained open. If so, the "burden of production" shifted to the employer to offer an explanation or suffer a presumption of discrimination. But, if the employer then offered a non-discriminatory explanation, the presumption disappeared, and the potential employee was required to show the employer's explanation was mere pretext for discrimination. McDonnell Douglas, 411 U.S. at 805.

This McDonnell Douglas approach has been adapted to other situations besides refusals to hire and to other civil rights statutes including the ADEA, but it is largely beside the point in this case. That is so because Cutler has from the outset offered an explanation for its action: it said that Melendez was not capable of performing as accounting manager under the new and more demanding accounting regime imposed by Eaton. Indeed, it asserted that this judgment was made not only by Cancel but also by a mainland executive of Eaton named Don Gardner, who offered an affidavit so claiming and describing the basis for his judgment. See Cumpiano v. Banco Santander Puerto Rico, 902 F.2d 148, 155 (1st Cir. 1990).

The question, then, at the summary judgment stage is whether Melendez has pointed to enough admissible evidence to create a factual issue for trial on the issue of motivation--that is to permit a reasonable jury to conclude that the decision to demote her was taken or prompted by someone based on age-based stereotyping or hostility. Her evidence in this case is two-fold: first, evidence that Cancel entertained (and expressed) age-biased views and that he played a direct role in her demotion; and second, evidence casting reasonable doubt on the company's claim that she was demoted for incompetence.

By affidavit and deposition evidence, Melendez created a jury issue on the question whether Cancel held such views. She, or others, quoted him as saying, among other things, that the ages of his accounting employees added up to more than a thousand years; that his employees were as old as Methuseleh; that they were "old women," "a bunch of incapacitated people" and "useless old women" and that "what I have here is Social Security." Melendez also said that Cancel told her that she was an old hag, an old lady and that "her age didn't allow her to think." Compare Thomas v. Sears, Roebuck & Co., 144 F.3d 31, 34 (1st Cir. 1998).

Cancel denied making some of the...