Tomsic v. State Farm Mut. Auto. Ins. Co.

• Citation: 85 F.3d 1472
• Decision Date: 07 June 1996
• Docket Number: No. 95-4002,95-4002
• Parties: 71 Fair Empl.Prac.Cas. (BNA) 137, 68 Empl. Prac. Dec. P 44,103 Irene P. TOMSIC and Sheila Browning, Plaintiffs-Appellants, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois corporation; and Norman Miller, Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (10th Circuit)

Page 1472

85 F.3d 1472

71 Fair Empl.Prac.Cas. (BNA) 137,

68 Empl. Prac. Dec. P 44,103

Irene P. TOMSIC and Sheila Browning, Plaintiffs-Appellants, v. STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, an Illinois

corporation; and Norman Miller, Defendants-Appellees.

No. 95-4002.

United States Court of Appeals,

Tenth Circuit.

June 7, 1996.

John S. Chindlund (James A. Boevers and Robert G. Wing with him on the brief) of Prince, Yeates & Geldzahler, Salt Lake City, Utah, for Plaintiffs-Appellants.

Glenn C. Hanni (David R. Nielson with him on the brief) of Strong & Hanni, Salt Lake City, Utah, for Defendants-Appellees.

Before HENRY, HOLLOWAY, and MURPHY, Circuit Judges.

HOLLOWAY, Circuit Judge.

Plaintiffs/appellants Irene Tomsic and Sheila Browning appeal the district court's grant of summary judgment for defendant/appellee State Farm on their Title VII gender discrimination claims. ¹ Tomsic v. State Farm Mutual Automobile Ins. Co., 870 F.Supp. 318 (D.Utah 1994). We have jurisdiction under 28 U.S.C. § 1291.

I

Plaintiffs were hired on April 1, 1991, as trainee agents of defendant. ² Employment as a trainee agent is temporary, lasting at most two years. Employees who successfully complete the training program become agents with the defendant under a contractual relationship but are no longer employees. Plaintiffs were terminated after about nine months in the program. A third trainee who had been hired at the same time as plaintiffs, a male named Toby Gonzales, was retained and successfully completed the program.

Under the terms of the employment contract, defendant was obligated to assign a management employee to provide training and supervision to plaintiffs. The supervisor assigned to train plaintiffs during the first three months of their employment was Dean Olsen. Olsen testified in deposition that plaintiffs were committed to the program, had good attitudes, and showed professionalism in dealing with clients.

After three months, plaintiffs were assigned a new supervisor, Norman Miller, who had been supervising Toby Gonzales from the beginning of his employment. Miller devoted more of his attention to Gonzales than to plaintiffs, according to Browning's deposition. Miller was supposed to complete weekly progress reports on plaintiffs as well as evaluations every three months. Miller prepared the evaluation for the initial three months of plaintiffs' employment, even though he had not been their supervisor during that period, and did so without the input of Olsen. Later, Miller sometimes falsified the weekly progress reports by claiming to have spent more time in training plaintiffs than he actually had, the plaintiffs said in their depositions. Miller's reports on Browning were conflicting; one week she would be rated very highly in all areas, while the next report would say she had a bad attitude and wasn't a team player. In September 1991, Browning won a contest among both trainees and experienced agents by submitting the highest number of life insurance applications in her district.

Within a month after becoming plaintiffs' supervisor, Miller told plaintiff Tomsic that he did not think she would succeed; he said her husband made too much money and that she therefore would lack incentive. He asked about Tomsic's marital relationship and whether her husband had ever had an affair. At about the same time, Miller told plaintiff Browning and Toby Gonzalez that Tomsic would be fired and one of them could have her office. Two weeks later he again told Browning that Tomsic would be fired.

On December 16, 1991, in a tape recorded conversation, Miller told Browning that she had a great future with State Farm but that production was not the most important evaluation factor. He said he was concerned that she devoted so much of her time to her career and that her personal and family life might suffer. He also expressed concern that marital problems might arise in a few years because she would likely be earning more than her husband. Miller later testified that his purpose in this interview, on instructions from his superior, was to try to convince Browning to resign voluntarily.

Three days later the decision was made to fire both plaintiffs, but apparently the decision was not acted on immediately. Plaintiffs were asked to resign in January. Tomsic resigned in late January. Browning refused to resign. On February 26, 1992, a letter was mailed notifying Browning that she was terminated as of February 29. She turned in a resignation on February 28.

The decision to fire plaintiffs was made by Mr. Lee Baumann, after receiving the comments and recommendations of Dave Powell and Norm Miller. Brief of Appellee at 15; Defendants' Answer, Aplt.App. at 24. Miller did not have the actual authority to terminate a trainee. Gonzales was retained, even though his production was not significantly better than plaintiffs', according to their deposition testimony, and poor production was ostensibly the primary reason for plaintiffs' termination.

II The District Court's Memorandum Decision and Order

The district court first analyzed the case according to the four elements of a prima facie case under McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S.Ct. 1817, 36 L.Ed.2d 668 (1973). ³ The court found that plaintiffs had shown they were members of a protected class and that issues of fact existed with regard to the second and third elements. The court held that plaintiffs' claims failed because they could not satisfy the fourth element, which the court viewed as requiring plaintiffs to show that State Farm had replaced them with individuals who were not members of the protected class. Because State Farm had neither sought nor hired replacements, plaintiffs could not establish a prima facie case, the judge concluded.

The district court then considered whether plaintiffs had shown direct evidence of discrimination which would make it unnecessary for them to follow the prima facie case paradigm of McDonnell Douglas. The court found that plaintiffs had not presented direct evidence of discriminatory intent. The statements by Miller to plaintiffs regarding their marital relationships alluded to "arcane" notions of women's role in society, but it did not appear that Miller himself held such views. Rather, as to the statement regarding Browning and the possibility that she might make more money than her husband, the judge said that Miller's concern was that such views, if held by others, might create an obstacle to plaintiff Browning's success with State Farm.

As to the statement regarding Tomsic's possible lack of motivation because of her husband's substantial earnings, the judge said that State Farm had a legitimate concern with its trainees' incentive; it would not be in State Farm's interest to expend resources training one whose only motivation was to "earn pocket change." 870 F.Supp. at 324. Further, the judge concluded that plaintiffs had failed to show that Miller's statements had anything to do with the decision to fire plaintiffs. At most, the judge concluded, plaintiffs could argue that discriminatory intent could be inferred from the statements, but this would not be direct evidence of discrimination. Id. (citing Heim v State of Utah, 8 F.3d 1541, 1547 (10th Cir.1993)).

Somewhat less clearly, the district judge also concluded that plaintiffs had failed to offer sufficient evidence that defendant's proffered reasons for discharging plaintiffs were a mere pretext for discrimination. Id. The judge's conclusion in this portion of his memorandum follows immediately from his conclusion that Miller's remarks did not constitute direct evidence of discrimination; it is unclear whether he actually analyzed the issue of whether sufficient evidence of pretext had been submitted.

III

A

We review a grant of summary judgment de novo, applying the same standard as the district court under Fed.R.Civ.P. 56(c). Universal Money Centers, Inc. v. A.T. & T, 22 F.3d 1527, 1529 (10th Cir.), cert. denied, --- U.S. ----, 115 S.Ct. 655, 130 L.Ed.2d 558 (1994). Summary judgment is appropriate if "there is no genuine issue as to any material fact and ... the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(c). We examine the factual record and reasonable inferences therefrom in the light most favorable to the nonmoving party. Id. If there is no genuine issue of material fact in dispute, we must determine whether the district court correctly applied the law. Applied Genetics Internat'l, Inc. v. First Affiliated Securities, Inc., 912 F.2d 1238, 1241 (10th Cir.1990).

B

Plaintiffs contend that the district judge's conclusion that they had failed to satisfy the fourth prong of the McDonnell Douglas prima facie case test was erroneous because that prong as stated in that case is simply inapplicable to the facts and circumstance of this case, which plaintiffs analogize to a failure to promote case. Plaintiffs contend that the particular structure of their employment, in which State Farm does not replace trainee agents who fail, should not insulate State Farm from liability if it unlawfully discriminates in its decisions. Plaintiffs argue that the district court failed to recognize that the McDonnell Douglas structure was never intended to be applied rigidly but instead should be adapted to the varying circumstances presented in particular cases.

We agree that the district court erred in applying the McDonnell Douglas framework without modification to suit the circumstances of this particular controversy. It is not necessary that plaintiffs' claims fit neatly into a pre-established category such as wrongful termination or failure to promote. We have previously noted the necessity of adapting the framework in the light of the facts presented. In Cole v. Ruidoso Municipal Schools, 43 F.3d 1373, 1380 (10th Cir.1994), we described the fourth prong of the prima facie case standard as merely requiring a showing that the...