Michael Daugherty v. Wabash Center, Incorporated

In the
United States Court of Appeals
For the Seventh Circuit
No. 08-3104
M ICHAEL E. D AUGHERTY,
Plaintiff-Appellant,
v.
W ABASH C ENTER, INC., AND JEFFREY D ARLING,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of Indiana, Hammond Division.
No. 4:06-CV-00128-AS-PRC—Allen Sharp, Judge.
A RGUED JULY 7, 2009—D ECIDED A UGUST 14, 2009
Before P OSNER, K ANNE, and SYKES, Circuit Judges.
P ER C URIAM. Michael Daugherty sued Wabash Center,
Inc., and its president, Jeffrey Darling, claiming that he
was fired in violation of the Family and Medical Leave
Act, 29 U.S.C. §§ 2601-2654. The district court granted
the defendants’ motion for summary judgment, and
Daugherty appeals. Because Daugherty did not show that
there was a genuine issue of material fact concerning
Wabash’s reason for firing him, we affirm.
2 No. 08-3104
Background
Because this is an appeal from the grant of summary
judgment, we construe all facts and draw all reasonable
inferences from the record in favor of Daugherty, the
nonmoving party. See Cracco v. Vitran Exp., Inc., 559
F.3d 625, 633 (7th Cir. 2009).
Daugherty began working for Wabash, a not-for-profit
agency serving adults and children with develop-
mental disabilities, in May 1999. Between 1999 and 2006,
Daugherty compiled an impressive employment re-
cord—he was promoted from a maintenance assistant
to director and then vice-president of information tech-
nology. He always received “very good” or “excellent”
performance reviews, and he was given a bonus for
his leadership in a particular project. Daugherty was
also vice-president and chief information officer of Rest
Assured, LLC, a joint venture between Wabash and
ResCare, Inc., that capitalized on Daugherty’s idea to
monitor patients via webcam.
Daugherty’s work-related troubles began in the spring
of 2006. He had gotten involved in “email wars” with
several Wabash employees, and the Rest Assured staff
complained about his management approach. On June 19,
Darling and Steve McAninch, Wabash’s Vice-President
of Finance (and Daugherty’s direct supervisor), gave
Daugherty a written reprimand for sending abusive
emails and for his management style. Daugherty acknowl-
edged his professional shortcomings, and, although he
thought the written reprimand was unwarranted, he
agreed with the substance of the complaints and even
No. 08-3104 3
drafted his own corrective action plan. Darling also
told Daugherty that he was revoking permission for
Daugherty’s planned month-long vacation, scheduled to
begin that month, because of pressing company business.
Before the corrective action plan was discussed,
Daugherty left the June 19 meeting to visit his doctor.
He returned to Wabash to request leave under the
FMLA, having a note from his doctor stating: “off work
2 weeks due to medical illness.” Daugherty’s application
for FMLA leave does not mention a health condition,
but instead describes personnel conflicts within the
company, concluding: “I have been placed under a tre-
mendous amount of stress with [Rest Assured] & [Wabash
Center]. I have requested from Jeff [Darling] & Steve
[McAninch] reorganization that would alleviate this
stress. It was declined. My much needed vacation has
been cancelled by Jeff Darling on 6-16-06.” The afternoon
of June 19 he requested and received two weeks off.
During his absence, Wabash uncovered troubling
information about Daugherty’s work performance. On
June 18, Daugherty had used Wabash’s credit card
without authorization to order a generator that was
delivered to his home. After investigating, Wabash dis-
covered at least five unauthorized purchases, including
one other that was shipped to “Daugherty’s Comput-
ers” at Daugherty’s home address. McAninch had previ-
ously warned Daugherty that he was required to seek au-
thorization before making purchases. Daugherty later
acknowledged his violations of company purchasing
protocol, but insists that these purchases were above-board
4 No. 08-3104
because he never kept the items for himself, and had
them shipped to his home only because Wabash couldn’t
easily accommodate some shipments.
Then on June 30, McAninch discovered that his
computer was missing emails that he had sent to and
received from Daugherty. That same day, two Wabash
servers crashed. Outside experts brought in to restore
the servers (because of Daugherty’s absence) observed
that Daugherty had failed to routinely back up the
servers—one of his key responsibilities. Suspecting that
Daugherty was remotely accessing (and potentially
sabotaging) Wabash’s network, the company asked these
outside consultants to analyze Wabash’s IT security and
practices. The consultants’ report in mid-July pointed
out deficiencies in Wabash’s IT infrastructure, recom-
mending numerous changes.
Because of the purchasing irregularities, Wabash man-
agement presented a new corrective action plan to
Daugherty on July 3, the day he was expected back at
work. At the end of the meeting, Daugherty refused to
sign the plan: he protested that signing would qualify
as “work” and he was not supposed to work during
medical leave. Instead he presented a new order from
his doctor for continued medical leave, which Wabash
granted. McAninch asked that Daugherty refrain from
accessing Wabash’s network while he was on leave,
and asked Daugherty to turn over his keys and any
passwords. Daugherty responded: “I’d rather not.”
Wabash requested the passwords and keys again—still
unsuccessfully—on July 19 and August 3.
No. 08-3104 5
On July 31, a forensic expert analyzed Daugherty’s
computer and discovered that more than 5,000 files had
been deleted on June 19—the day Daugherty was first
disciplined and the day he invoked FMLA leave. On
August 9, citing Daugherty’s authoritarian management
style, poor IT practices, failure to turn over keys, missing
files, and violations of the purchasing protocols, Wabash
terminated Daugherty’s employment.
Daugherty filed suit in September 2006, claiming that
Wabash and Darling fired him in violation of the FMLA.
The district court granted the defendants’ motion for
summary judgment, and Daugherty appeals.
Analysis
Daugherty challenges the district court’s grant of sum-
mary judgment on two grounds: the defendants violated
the Act by failing to reinstate him and retaliated against
him for invoking his FMLA rights.
A. Failure to Reinstate
Daugherty first argues that Wabash violated the FMLA
by failing to reinstate him to his former position at the
end of his medical leave. He contends that Wabash was
absolutely prohibited from terminating him while he
was on leave. According to Daugherty, even if an em-
ployer discovers a reason to fire an employee during
that employee’s FMLA leave, the employer must reinstate
the employee before then firing him.
6 No. 08-3104
To show a violation of FMLA rights, plaintiffs must show
that they are eligible for FMLA protection, their employer
is covered by the Act, they are entitled to leave, they
provided the appropriate notice, and their employer
denied them benefits to which they were entitled. Smith
v. Hope Sch., 560 F.3d 694, 699 (7th Cir. 2009). An
employee who takes leave under the FMLA is entitled to
be restored to his former position, with equivalent pay
and benefits. 29 U.S.C. §§ 2614, 2615(a); Vail v. Raybestos
Prods. Co., 533 F.3d 904, 909 (7th Cir. 2008), cert. denied,
129 S. Ct. 1361 (2009). This right is not unlimited, how-
ever: an employee is not entitled to “any right, benefit, or
position of employment other than any right, benefit, or
position to which the employee would have been entitled
had the employee not taken the leave.” 29 U.S.C.
§ 2614(a)(3)(B); 29 C.F.R. § 825.216; Harrell v. U.S. Postal
Serv., 445 F.3d 913, 919 (7th Cir. 2006). The defendants
contest only Daugherty’s right to reinstatement.
Daugherty contends that, although the FMLA does not
make employees on medical leave fire-proof, Wabash
was required to reinstate him and then fire him if it
was displeased with his performance. But because the
FMLA only entitles employees to the same position they
would have otherwise been entitled to, 29 U.S.C.
§ 2614(a)(3)(B), an employer may terminate employ-
ees—even when on leave—if the employer discovers
misconduct that would justify termination had leave not
been taken. “The fact that the leave permitted the em-
ployer to discover the problems can not logically be a
bar to the employer’s ability to fire the deficient em-
ployee.” Kohls v. Beverly Enters. Wis., Inc., 259 F.3d 799,
806 (7th Cir. 2001).
No. 08-3104 7
Wabash presented undisputed evidence that Daugherty
had unprofessional email exchanges with other em-
ployees, was abusive to his staff, purchased items in
violation of company policy, refused to return keys and
disclose passwords, and deleted company files from his
workstation. At various points Daugherty admitted each
of these violations of company policy, even proposing his
own corrective action plan. And Daugherty makes
no attempt to refute the conclusions of the outside com-
puter consultants who reported to Wabash num-
erous serious deficiencies in Daugherty’s performance.
Instead, Daugherty insists that being asked to turn over
keys and passwords was “work,” and he could not be
fired for refusing to work while on medical leave. But
Wabash asked for keys and passwords so the agency
could operate without Daugherty. Moreover, these
modest requests—first made on the day Wabash had
expected Daugherty to return to work—are no more
intrusive than the requirement to keep the employer
informed about the status of medical leave, see 29 C.F.R.
§ 825.311(a), or otherwise comply with customary em-
ployer rules regarding notice, 29 C.F.R. § 825.303(c);
Lewis v. Holsum of Fort Wayne, Inc., 278 F.3d 706, 710 (7th
Cir. 2002). There is no genuine dispute concerning
Daugherty’s entitlement to reinstatement: even if he
had never taken leave, he would not be entitled to keep
his job.
B. Retaliation
Daugherty contends, in the alternative, that Wabash
retaliated against him by firing him for exercising his
8 No. 08-3104
rights. See Kauffman v. Fed. Express Corp., 426 F.3d 880, 884-
85 (7th Cir. 2005) (distinguishing between the two
theories of recovery). As with other employment dis-
crimination statutes, a claim for retaliation under the
FMLA can proceed through the direct or indirect methods
of proof. Buie v. Quad/Graphics, Inc., 366 F.3d 496, 503
(7th Cir. 2004). On appeal Daugherty argues only that
he made his case under the direct method.
Under the direct method of proving retaliation, a plain-
tiff must present evidence of a statutorily protected
activity, a materially adverse action taken by the em-
ployer, and a causal connection between the two. Caskey
v. Colgate-Palmolive Co., 535 F.3d 585, 593 (7th Cir.),
cert. denied, 129 S. Ct. 738 (2008). Wabash contests only
causation. “A plaintiff can prevail under the direct
method by showing an admission of discrimination or
by ‘constructing a convincing mosaic of circumstantial
evidence that allows a jury to infer intentional discrim-
ination by the decisionmaker.’ ” Ridings v. Riverside
Med. Ctr., 537 F.3d 755, 771 (7th Cir. 2008) (quoting Phelan
v. Cook County, 463 F.3d 773, 779 (7th Cir. 2006)).
As analyzed above, Wabash presented undisputed
evidence that it fired Daugherty for misconduct.
Daugherty’s principal argument appears to be that,
although he repeatedly violated company policy, his
misconduct does not justify Wabash’s decision to
terminate his employment. He suggests that his designa-
tion as a “key employee,” see 29 C.F.R. § 825.217, was
evidence of Wabash’s discriminatory animus. But while
an employer need not reinstate a key employee, 29 C.F.R.
No. 08-3104 9
§ 825.216, Daugherty does not contest the designation
nor explain how it affected Wabash’s decision to fire
him. Moreover, Wabash never purported to rely on his
status as a key employee to deny reinstatement.
Daugherty further argues that the timing of his termina-
tion—that is, while he was on leave—suggests that his
medical leave, not his admitted professional failings,
was the defendants’ true motivation for firing him.
Under some circumstances, an employee’s termination
while on leave can create an inference of discriminatory
motive. Simpson v. Office of Chief Judge of Circuit Court of
Will County, 559 F.3d 706, 713 (7th Cir. 2009). But this court
has held repeatedly that temporal proximity alone is not
sufficient to withstand summary judgment. See, e.g.,
Andonissamy v. Hewlett-Packard Co., 547 F.3d 841, 851 (7th
Cir. 2008); Tomanovich v. City of Indianapolis, 457 F.3d 656,
665 (7th Cir. 2006); Wyninger v. New Venture Gear, Inc., 361
F.3d 965, 981 (7th Cir. 2004). And, while Daugherty
relies on Wabash’s promise to use progressive discipline
when it initially addressed his management problems,
he points to no company policy or past practice violated
by Wabash when it fired him after discovering addi-
tional evidence of his sub-par performance and potential
sabotage. Cf. Rudin v. Lincoln Land Cmty. Coll., 420 F.3d
712, 723 (7th Cir. 2005) (holding that abandonment of
hiring policies supported inference of discrimination in
Title VII case); Huff v. UARCO, Inc., 122 F.3d 374, 382 (7th
Cir. 1997) (holding that failure to follow company layoff
policy supports inference of discrimination).
We do not “tell employers how to discipline employees;
rather, [we] ensure that the process is not discriminatory.”
10 No. 08-3104
Kohls, 259 F.3d at 805. Here, Daugherty admits that
“Darling and Wabash Center are earnest in their
appraisals that they fired Daugherty for performance
reasons. They really, really mean it.” Of course, if the
defendants “really mean” that they fired him for work-
related reasons, then Daugherty’s termination was not
retaliatory. See Culver v. Gorman & Co., 416 F.3d 540, 547
(7th Cir. 2005) (“An employer’s explanation can be
‘foolish or trivial or even baseless’ so long as it ‘honestly
believed’ the proffered reasons for the adverse employ-
ment action.” (citations omitted)). There is no dispute
concerning Wabash’s motive, and therefore summary
judgment was appropriate.
Conclusion
Because Daugherty has not shown a genuine issue of
material fact concerning defendants’ motivation for
firing him, we A FFIRM .
8-14-09