Nikesh Shah v. Chevron USA, Incorporated

Case: 18-20817 Document: 00515210602 Page: 1 Date Filed: 11/22/2019
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 18-20817 FILED
November 22, 2019
Lyle W. Cayce
NIKESH SHAH, Clerk
Plaintiff - Appellant
v.
CHEVRON USA, INCORPORATED,
Defendant - Appellee
Appeal from the United States District Court
for the Southern District of Texas
USDC No. 4:17-CV-1465
Before CLEMENT, ELROD, and DUNCAN, Circuit Judges.
PER CURIAM:*
Nikesh Shah sued his former employer, Chevron USA, Inc., under § 510
of ERISA, which prohibits an employer from firing an employee to prevent him
from receiving benefits under an ERISA-governed benefit plan. Shah alleges
that Chevron fired him to prevent him from receiving a severance package and
soon-to-vest retirement benefits. Chevron responds that it fired Shah because
of his poor performance.
* Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH
CIR. R. 47.5.4.
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The district court granted Chevron’s motion for summary judgment. It
held that Shah had not produced sufficient evidence to show that Chevron fired
him to prevent him from receiving pension or severance benefits rather than
for his poor performance. We AFFIRM the district court’s judgment.
I
Shah began working for Chevron as an “Oils Planning Analyst” on April
17, 2012. He enrolled in the Chevron Retirement Plan, which would give him
vested retirement benefits after five years of employment.
In early 2015, Chevron made Shah a “Crude Exposure Analyst” and
moved him to a team supervised by Barbara Harrison. His new position had
a salary level of “Pay Scale Grade 23.” In March 2016, Shah received his first
annual performance evaluation in the new position. Harrison noted that
Shah’s “[p]erformance was below expectation of a PSG 23 employee in the
areas of independent work and analytical methodology,” and that Shah needed
to improve “proactive communication” and “analytical depth.” Harrison also
gave Shah informal feedback in emails and in person about similar
performance deficiencies throughout 2015 and 2016. She also discussed her
concerns with her supervisors.
On August 3, 2016, Chevron announced job cutbacks as part of the
“Project Delta” cost-reduction program. Harrison and her supervisor, Chris
Yates, were involved in proposing organizational changes to reduce the
number of employees in the department where Shah worked. They attended
meetings to discuss the reorganization throughout the remainder of the year.
On August 4, 2016, Harrison submitted Shah’s next scheduled, formal
performance review. She noted that Shah continued to “rely heavily . . . on
others to assist and guide [his] data analysis versus demonstrating ownership
and mastery of the process.” She again noted his deficiencies in “level of
independent work product” and “depth of analysis.” Harrison reported that
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Shah required more assistance “to ensure clarity of message, data quality and
formatting” in his work product than she “expect[ed] for a PSG 23 employee.”
At that salary level, Harrison expected Shah to complete his work “quickly
with minimal assistance.”
In August or September, Harrison discussed Shah’s performance issues
with Human Resources Advisor Michelle Cochran for the first time. They
discussed placing Shah on a “Performance Improvement Plan” to see whether
he could improve his work to an acceptable level. Harrison again discussed
Shah’s performance with Yates, and then decided to put Shah on an
improvement plan. She met with Shah in early November and explained that
his failure to improve in the next three months as outlined in the plan could
result in his termination.
By December 2016, Chevron had decided to eliminate Shah’s position of
Crude Exposure Analyst as part of the department reorganization. But the
decision was not announced publicly, and Shah was not notified at that time.
Harrison continued to meet with Shah about once every two weeks during the
improvement-plan period to discuss his performance. In January 2017,
Harrison decided that Shah’s performance had not improved and that he
should be terminated. On February 2, Harrison and Yates exchanged emails
about the decision to fire Shah, and then formally memorialized the decision
in an email exchange with Cochran and Yates’s supervisor on February 7.
Harrison met with Shah on February 13, 2017, and terminated his
employment.
The following day, Chevron notified some employees in the department
where Shah had worked that their positions were being eliminated as part of
Project Delta. The Crude Exposure Analyst was one of those positions.
Effective February 15, 2017, employees whose positions were eliminated as
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part of Project Delta could be eligible for severance pay under an ERISA plan
if Chevron did not transfer them to another position.
A few months later, Shah sued Chevron, alleging that it fired him to
prevent him from receiving three benefits in violation of ERISA § 510 and
Texas quantum meruit principles: “a five-year vesting benefit, a severance
package, and a non-discretionary bonus.” After discovery, Chevron moved for
summary judgment. The district court concluded that Shah had failed to
provide sufficient evidence to support either claim and granted summary
judgment to Chevron. On appeal, Shah has abandoned the quantum meruit
claim and any argument about bonuses. He now argues only that the district
court erred in granting summary judgment to Chevron on his ERISA claim for
the retirement plan and severance pay.
II
This court reviews a grant of summary judgment de novo, applying the
same standard as the district court. Unida v. Levi Strauss & Co., 986 F.2d 970,
975 (5th Cir. 1993). If Shah has “fail[ed] to make a showing sufficient to
establish the existence of an element essential to [his] case, and on which [he]
will bear the burden of proof at trial,” then no genuine dispute of material fact
exists, and Chevron is entitled to summary judgment. Id. at 975–76 (quoting
Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)).
III
Under § 510 of ERISA, an employer may not “discharge . . . a participant
or beneficiary . . . for the purpose of interfering with the attainment of any
right to which such participant may become entitled under” an ERISA-
governed benefit plan. 29 U.S.C. § 1140.
To succeed on his § 510 claim, Shah must first “establish a prima facie
case that [Chevron] fired him with a specific discriminatory intent” to prevent
him from receiving ERISA benefits. Stafford v. True Temper Sports, 123 F.3d
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291, 295 (5th Cir. 1997). He “need not prove that the discriminatory reason
was the only reason for discharge, but he must show that the loss of benefits
was more than an incidental loss from his discharge.” Id. “To dispel the
inference of discrimination which would arise from a prima facie case,
[Chevron] must articulate a non-discriminatory reason for its actions, and then
the burden shifts to [Shah] to prove this reason is a pretext and the real
purpose was denial of ERISA benefits.” Id.
Assuming that Shah established a prima facie case, he does not contest
the district court’s conclusion that Chevron satisfied its burden of going
forward with evidence of a legitimate, non-discriminatory reason for firing
him—poor job performance. See Faruki v. Parsons S.I.P., Inc., 123 F.3d 315,
320 (5th Cir. 1997) (relying on poor job performance as a legitimate, non-
discriminatory reason for termination). The dispositive question, then, is
whether the record contains sufficient evidence to create a genuine factual
dispute about whether Chevron’s proffered reason for firing Shah is pretextual.
We conclude that the record does not.
A
Shah’s primary argument about pretext focuses on chronology: Harrison
fired him just two days before he could have been eligible for the Project Delta
severance plan and two months before his retirement benefits would have
vested. But chronology undermines Shah’s argument: Harrison testified that
she learned about the five-year vesting requirement only after Shah filed this
lawsuit. 1 If she didn’t know about the vesting requirement and Shah’s vesting
date, she couldn’t have fired Shah with the specific intent to prevent his
retirement benefits from vesting. Furthermore, the record contains no evidence
1 Harrison did not learn about the five-year vesting requirement when she was hired
because Chevron had not yet implemented it.
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that the pension or severance benefits would have been paid from the budget
in Harrison’s department or, if they would have, that Harrison knew this. In
fact, Harrison testified that she did not know the source of the retirement
funds. 2 Unless Harrison knew that benefits payments would come out of her
budget, she would have no reason to fire Shah with the specific intent to avoid
paying Shah those benefits. Unless Shah can point to other evidence that could
convince a reasonable jury that Harrison was not telling the truth, he cannot
prevail on his claim.
Shah attempts to meet that burden with more chronology: Harrison
criticized Shah’s work in his August 2016 performance review just one day
after Project Delta was announced, and Harrison discussed his job
performance with HR for the first time shortly thereafter. But, again, the
chronology refutes Shah’s claim. Harrison began criticizing Shah’s job
performance no later than March 2016, months before she knew about Project
Delta. And her critiques after Project Delta was announced mirror her earlier
ones. After explaining in March that Shah should improve the quality and
depth of his analysis, Harrison found in August that he had not improved and
still required more coaching than she expected of an employee at his salary
level. Harrison’s first conversation with Cochran in HR then followed closely
on the heels of the second negative review.
Shah also points out that Harrison continued to meet with him regarding
his improvement plan well after she knew that his position was being
eliminated. Unless Harrison was trying to fabricate a reason to fire him, Shah
argues, there would be no reason to keep him in the dark and continue the
improvement plan. But nothing about Harrison’s behavior is inconsistent with
2 Cochran likewise testified that she did not know whether vested retirement benefits
or severance packages would be paid from the department’s budget.
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firing Shah for poor job performance. Chevron did not publicly announce which
positions it would eliminate until February 2017. Nothing was withheld from
Shah specifically. And the fact that Harrison knew that Chevron would
eliminate Shah’s position does not mean that she had already decided to fire
him. If he performed well on the improvement plan, Harrison could have
recommended that he be moved to a different position when his current one
was eliminated.
Furthermore, if Harrison thought Shah’s performance might justify
termination, placing Shah on an improvement plan would be an important part
of testing her suspicions. This kind of deliberative process is precisely what one
would expect a responsible employer to go through before deciding whether to
fire or relocate an employee. Relying on the improvement plan as evidence that
Chevron’s proffered motive was a mere pretext would be perverse.
B
Shah next attempts to bolster his chronology evidence by comparing his
performance with his predecessor’s. The prior Crude Exposure Analyst
received a lower numerical score than Shah on his performance evaluation, but
he was moved to a different position rather than fired. The comparison,
however, is inapt because Shah and his predecessor are not similarly situated
for purposes of comparing their performance and Harrison’s personnel
decisions.
Shah’s predecessor was the first person to fill the Crude Exposure
Analyst position. His background was in information technology. When
Harrison discovered that he lacked the necessary analytical skills to be a Crude
Exposure Analyst, she recommended that he be reassigned to another job
where his demonstrated IT skills would be more valuable. In looking for a
replacement, Harrison consciously decided to increase the expectations of the
employee in that role and tried to hire someone who could work independently
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with little oversight. She also decided to raise the salary grade for the position
to reflect her higher expectations. Harrison later tied many of her critiques of
Shah’s performance to his failure to show the degree of proactivity and depth
of analysis that she expected of an employee at his salary level.
The record shows that Chevron had decided that the job demanded more
advanced abilities and would be rewarded with higher pay. When Shah failed
to achieve the higher level of performance he was hired and compensated for,
Harrison fired him. 3
* * *
Shah has not provided sufficient evidence to show that Chevron used his
job performance as a pretext for firing him to avoid paying severance and
retirement benefits. We thus AFFIRM the district court’s judgment.
3 Shah’s accusations that Harrison knowingly put a false statement in his
improvement plan and that Yates admitted to fabricating a paper trail to justify Shah’s
termination are meritless and misrepresent the evidence in the record.
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