Rhymer v. Yokohama Tire Corp

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
JAMES LARRY RHYMER,
Plaintiff-Appellant,
v.
No. 96-1191
YOKOHAMA TIRE CORPORATION,
formerly known as Mohawk Rubber
Company,
Defendant-Appellee.
Appeal from the United States District Court
for the Western District of Virginia, at Roanoke.
James C. Turk, District Judge.
(CA-93-198-R)
Argued: December 4, 1996
Decided: January 16, 1997
Before RUSSELL and MICHAEL, Circuit Judges, and DAVIS,
United States District Judge for the District of Maryland, sitting by
designation.
_________________________________________________________________
Affirmed by unpublished per curiam opinion.
_________________________________________________________________
COUNSEL
ARGUED: Melissa Windham Friedman, Roanoke, Virginia, for
Appellant. Thomas R. Crookes, BROUSE & MCDOWELL, Akron,
Ohio, for Appellee. ON BRIEF: Anthony F. Anderson, Roanoke,
Virginia, for Appellant. R. Scot Harvey, BROUSE & MCDOWELL,
Akron, Ohio; Bayard E. Harris, Agnis C. Chakravorty, THE CEN-
TER FOR EMPLOYMENT LAW, Roanoke, Virginia, for Appellee.
_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
_________________________________________________________________
OPINION
PER CURIAM:
James Rhymer appeals the award of summary judgment to his for-
mer employer, Yokohama Tire Corporation (Yokohama), on his
claims for discrimination under the Age Discrimination in Employ-
ment Act (ADEA), 29 U.S.C. § 621 et seq. , and for breach of an
implied contract of employment. Finding no error, we affirm the dis-
trict court.
I.
In 1964 Rhymer was hired by Mohawk Rubber Company
(Mohawk), the predecessor to Yokohama. After working for Mohawk
in Akron, Ohio, and Helena, Arkansas, Rhymer was transferred to the
Salem, Virginia, plant in 1976. At Salem Rhymer initially served as
plant controller. Later, he was plant manager for several years, but he
eventually returned to his old position as plant controller, the job he
held until he was terminated on January 28, 1992.
Upon his arrival at the Salem facility, Rhymer received an
employee handbook and was told that the book contained the general
rules for plant employees. Rhymer testified in his deposition that the
person who gave him the handbook said that it guaranteed his
employment if he did an acceptable job. Rhymer admitted, however,
that he reviewed the handbook and found no mention of a guarantee
of employment.
Yokohama purchased Mohawk in 1989. Yokohama's corporate
offices were in Akron, Ohio. After the acquisition, Rhymer primarily
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reported to Richard Switzer, the plant manager at Salem, and Mat-
thew Anderson, the acting corporate controller in Akron.
Rhymer's duties as plant controller were varied and extensive. He
was responsible for all of the plant's finances, including budget prep-
aration and the preparation of reports and analyses relating to usage
and spending variances. During most of his employment with Yoko-
hama, Rhymer was regarded as a good employee. He received yearly
raises and bonuses, including a bonus the month before his termina-
tion. However, in the months preceding his termination, Rhymer
came under increasing pressure to address the problem of usage and
spending variances at the Salem plant. A usage variance problem
meant that too few tires were being produced for the amount of raw
materials purchased. A spending variance problem meant that mate-
rial and service costs were exceeding company standards or were too
high.
Both Switzer, the plant manager, and Anderson, the acting corpo-
rate controller, told Rhymer that they were concerned about his
inability to analyze the variance problem and to suggest countermea-
sures. On December 13, 1991, Switzer sent Rhymer a letter warning
him that his treatment of the problem of "inventory shortages" (that
is, usage variance) at the Salem plant "had not been satisfactory." On
December 20, 1991, Anderson sent Rhymer a letter telling him that
he "must be pro-active instead of reactive" in analyzing and recom-
mending potential solutions to the usage variance problem. On Janu-
ary 22, 1992, Rhymer attended an executive committee meeting in
Akron. The minutes of the meeting reflect the following: Switzer
announced that Rhymer would speak on the variance issue. After
Rhymer made his presentation, Y. Hanabusa (the company president)
asked why the usage variance problem was worse in 1991 than in
1990 and 1989. Rhymer could not explain, asserting that he lacked
the right tools. For example, Rhymer said that he received informa-
tion too late to control the problems. Hanabusa indicated his displea-
sure with Rhymer and told him that he was the person responsible for
controlling variances and costs.
On January 28, 1992, Rhymer was terminated. He was 54 at the
time. Hanabusa, not Switzer or Anderson, made the decision to termi-
nate Rhymer. Yokohama cited Rhymer's inability to perform the ana-
3
lytical and financial roles of a plant controller, including his inability
to deal with the variance problem, as the reason for his termination.
The parties dispute which person or persons assumed Rhymer's duties
after his termination. Rhymer claims that Gary Purdy, age 41, took
over most of his work.
Rhymer sued Yokohama in district court, claiming that Yokohama
discharged him because of his age in violation of the ADEA and that
Yokohama breached his employment contract that was created,
Rhymer asserts, by an employee handbook. The district court granted
Yokohama's motion for summary judgment, concluding that Rhymer
failed to establish a prima facie case of age discrimination and failed
to establish the existence of a valid employment contract under Vir-
ginia law. Rhymer appeals.
II.
We review grants or denials of motions for summary judgment de
novo. Jackson v. Kimel, 992 F.2d 1318, 1322 (4th Cir. 1993). If there
is no genuine dispute as to a material fact, the moving party is entitled
to judgment as a matter of law. Fed. R. Civ. P. 56(c). In a discrimina-
tion case "[a]n employer is entitled to summary judgment if the plain-
tiff fails to establish a prima facie case of discrimination or fails to
raise a factual dispute regarding the employer's proffered reasons for
the alleged discriminatory act." Henson v. Liggett Group, Inc., 61
F.3d 270, 274 (4th Cir. 1995). We noted in EEOC v. Clay Printing
Co., 955 F.2d 936, 943 (4th Cir. 1993), that"``the mere existence of
a scintilla of evidence in support of the plaintiff's position will be
insufficient; there must be evidence on which the jury could reason-
ably find for the plaintiff.'" (quoting Anderson v. Liberty Lobby, Inc.,
477 U.S. 242, 252 (1986)). To establish a claim under the ADEA, "a
plaintiff must show that but for the employer's motive to discriminate
against plaintiff on the basis of age, the discriminatory action would
not have occurred." Henson, 61 F.3d at 274 (citations omitted).
A.
On his ADEA claim Rhymer relies upon the indirect, burden-
shifting method of proof developed in McDonnell Douglas Corp. v.
Green, 411 U.S. 792 (1973); see Lovelace v. Sherwin-Williams Co.,
4
681 F.2d 230, 239 (4th Cir. 1982) (adopting McDonnell Douglas pre-
sumption framework in ADEA cases). If a plaintiff proceeds under
the McDonnell Douglas framework, the case essentially breaks into
three steps. First, the plaintiff must establish a prima facie case of
discrimination. McDonnell Douglas, 411 U.S. at 802. Second, the
defendant must respond with a nondiscriminatory reason for the ter-
mination. McDonnell Douglas, 411 U.S. at 802. Third, if the defen-
dant responds with a legitimate nondiscriminatory reason, the
"plaintiff must then bear the ultimate burden of persuasion and show
by a preponderance of the evidence that the defendant's explanations
are pretextual or otherwise unworthy of credence." Henson, 61 F.3d
at 275 (citations omitted).
When the district court granted summary judgment to Yokohama,
there were four factors that a plaintiff had to demonstrate to make out
a prima facie case for age discrimination in this circuit. O'Connor v.
Consolidated Coin Caterers Corp., 56 F.3d 542, 546 (4th Cir. 1995),
rev'd, 116 S. Ct. 1307 (1996). The plaintiff had to show (1) that he
was a member of the protected class (ages 40-70), (2) that he had
been discharged, (3) that he was performing his job at a level that met
his employer's legitimate expectations, and (4) that he was replaced
by someone of comparable qualifications outside the protected class.
Id. at 546. The district court concluded that Rhymer had failed to
meet the fourth factor because he was replaced by someone within the
protected class.
After the district court's decision the Supreme Court rejected our
fourth factor for a prima facie case in age discrimination cases. See
O'Connor v. Consolidated Coin Caterers Corp., 116 S. Ct. 1307(1996). In Consolidated Coin Caterers the Supreme Court said that
"the fact that a replacement is substantially younger than the plaintiff
is a far more reliable indicator of age discrimination than is the fact
that the plaintiff was replaced by someone outside the protected
class." Id. at 1310 (emphasis added). The Supreme Court left our first
three factors intact.
Here, we agree with the district court that Rhymer made out the
first three factors of a prima facie case. However, in light of the
Supreme Court's decision in Consolidated Coin Caterers, we must re-
5
assess whether Rhymer has met the fourth factor, that is, whether he
has shown that he was replaced by someone substantially younger.
Rhymer was 54 years old when Yokohama terminated him, and
there is a dispute as to which person or persons replaced Rhymer.
Rhymer contends that he was replaced primarily by a new hire, Gary
Purdy, who was 41. Yokohama contends that Rhymer's duties were
given to several persons of various ages: Purdy, Robert Craig (age
58), Yohio Amano (age 46), and Robert Keen (age 45).
Because we must view all factual inferences in a light that favors
the non-moving party, see Matsushita Electric Indus. Co. v. Zenith
Radio Corp., 475 U.S. 574, 587-88 (1986), we will accept Rhymer's
contention that he was primarily replaced by Purdy. Purdy, age 41,
was substantially younger than Rhymer, who was 54. Because
Rhymer met the (modified) fourth factor, he did establish a prima
facie case.
The burden then shifts to Yokohama to respond with a legitimate
nondiscriminatory reason for the termination. McDonnell Douglas,
411 U.S. at 802. Yokohama cites Rhymer's poor job performance,
specifically his inability to analyze and to recommend solutions for
the usage variance problem. This explanation is sufficient to dis-
charge Yokohama's burden of production at the second step.
We continue to the third step of the McDonnell Douglas scheme
and address the "straightforward" question of whether "the plaintiff
has successfully demonstrated that [he] was the victim of age discrim-
ination on the part of the employer." Burns v. AAF-McQuay, Inc., 96
F.3d 728, 732 (4th Cir. 1996) (quoting Henson v. Liggett Group, Inc.,
61 F.3d 270, 275 (4th Cir. 1995) (citations omitted)). "[I]f the plaintiff
offers nothing to disprove the defendant's nondiscriminatory explana-
tion[ ], the explanation['s] weakness alone is insufficient to create an
issue of pretext." Id. The plaintiff bears the ultimate burden of pre-
senting "affirmative evidence of age-based animus." Id.Rhymer argues that his immediate supervisors, Switzer and Ander-
son, did not agree with Hanabusa's decision to fire him. He reasons,
therefore, that his job performance must have been satisfactory and
the real reason for his termination must have been his age. Rhymer
6
did not take the deposition of Hanabusa, the person responsible for
the decision to fire Rhymer. But there is evidence in the record
(including the minutes of the January 22, 1992, executive committee
meeting) suggesting that Hanabusa was dissatisfied with Rhymer's
job performance. Although Switzer and Anderson, who were them-
selves critical of Rhymer's performance, did not think that Rhymer's
inadequacies rose to a level warranting termination, that does not sup-
port an inference that Hanabusa (the company president) fired
Rhymer because of age discrimination.
Rhymer also relies on the fact that since February 1992 Yokohama
has hired ten management persons, and only one of those hired was
within the protected class (age 40-70). Rhymer, however, produced
no demographic information about the pool of employees at Yoko-
hama nor about the pool from which employees were hired. Without
data about the relevant labor pool, the figures offered by Rhymer are
not proof of discrimination. See Henson, 61 F.3d at 276-77.
Finally, in an affidavit Rhymer said, "Yokohama employees have
commented to me that they have heard Mr. Akashi state that perhaps
older workers should be replaced because they would not change their
ways." "[A]lleged discriminatory statements can be indicative of dis-
crimination." Henson, 61 F.3d at 276. However, to constitute proba-
tive evidence any statement must relate to a "particular person,
employment decision, or pattern of decisionmaking." Id.; see also
Clay Printing, 955 F.2d at 941-42 (noting there was no nexus
between the alleged discriminatory statements and any employment
decisions made by the employer). Assuming Rhymer could overcome
the hearsay problems with the statement attributed to Akashi, Rhymer
has still not shown that there was any connection between the Akashi
statement and Hanabusa's decision to terminate him.
We must conclude that the evidence Rhymer relies on to show age-
based animus is not sufficient to create a genuine issue of material
fact on the ultimate question of whether Yokohama intentionally dis-
criminated against him because of his age. We therefore affirm the
district court's grant of summary judgment to Yokohama on Rhym-
er's ADEA claim.
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B.
Rhymer also contends that the district court erred when it granted
Yokohama summary judgment on his breach of contract claim.
Rhymer argues that the employee handbook constituted an implied
promise that he would be fired only "for cause" and thus rebutted any
presumption of at-will employment.
The district court determined correctly that Virginia law governs
the contract issue because the parties entered into the employment
relationship in Virginia. See Nguyen v. CNA Corp., 44 F.3d 234, 237
(4th Cir. 1995). Virginia adheres to the common law rule that absent
a provision to the contrary, contracts for the rendition of services are
at-will. Miller v. SEVAMP, Inc., 362 S.E.2d 915, 916-17 (Va. 1987).
In a case interpreting Virginia law, we said that we will not "imply
a just cause provision where one is not explicitly provided." Nguyen,
44 F.3d at 238 (quoting Sullivan v. Snap-On Tools Corp., 708 F.
Supp. 750, 752 (E.D. Va. 1989)).
Rhymer contends that the following section in the employee hand-
book creates a right not to be fired without cause:
LOSS OF SERVICE: There are several ways an
employee can lose his service. The following things will
result in loss of service:
(1) Voluntary termination of employment.
(2) An employee absent for three consecutive days with-
out permission will be regarded as a voluntary resignation.
(3) Discharge for just cause: This could include violation
of rules, unsatisfactory work performance, or improper con-
duct.
....
(Emphasis added). A common sense reading of the employee hand-
book defeats Rhymer's contention. The phrase mentioning "just
8
cause" was placed in the employee handbook under the "LOSS OF
SERVICE" heading. The handbook defines "service" as "the time that
the employee has worked for the Company. It gives the employee cer-
tain preferences or ranking when decisions must be made in regard
to promotions, reduction in forces and determination of eligibility for
the various benefits." (Emphasis added). "Discharge for just cause" is
simply one of the ways in which "service" time can be lost. Thus, the
phrase is not used as an explicit "just cause" provision which would
limit the company's ability to terminate employees. Indeed, nowhere
in the handbook does it say that an employee can be discharged only
for just cause.
In addition, Virginia recognizes the concept of mutuality of
engagement. See Town of Vinton v. City of Roanoke, 80 S.E.2d 608,
617 (Va. 1954) (noting that "there must be absolute mutuality of
engagement, so that each party has the right to hold the other to a pos-
itive agreement.") (citations omitted). "Notions of fundamental fair-
ness underlie the concept of mutuality which extends a corresponding
freedom to the employer." Miller, 362 S.E.2d at 917. "It is hornbook
law that a contract terminable at the will of one party is terminable
at the will of the other. . . ." Hicks v. Freeman, 397 F.2d 193, 194-95
(4th Cir. 1968). Rhymer testified in his deposition that he would have
been free to quit his job with Yokohama anytime he wished. He also
admitted that he had looked at the employee handbook and found no
guarantee of employment. In light of the language in the employee
handbook and Rhymer's admissions during his deposition, we agree
with the district court's determination that Rhymer has not offered
sufficient evidence to rebut the presumption that he was an at-will
employee.
III.
The district court's award of summary judgment to Yokohama Tire
Corporation is affirmed.
AFFIRMED
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