Miller, Donna S. v. Adminastar Federal

UNPUBLISHED ORDER
Not to be cited per Circuit Rule 53
United States Court of Appeals
For the Seventh Circuit
Chicago, Illinois 60604
Argued April 18, 2006
Decided May 9, 2006
Before
Hon. ILANA DIAMOND ROVNER, Circuit Judge
Hon. TERENCE T. EVANS, Circuit Judge
Hon. DIANE S. SYKES, Circuit Judge
No. 05-2648
DONNA S. MILLER, Appeal from the United States District
Plaintiff-Appellant, Court for the Southern District of Indiana,
Indianapolis Division
v.
No. 03 C 1391
ADMINASTAR FEDERAL, INC.,
Defendant-Appellee. David F. Hamilton,
Judge.
ORDER
AdminaStar Federal, Inc. fired Donna Miller for violating the company’s
policy against employing convicted felons after she pleaded guilty to felony
possession of a controlled substance. Miller brought suit against AdminaStar
alleging that she was fired because of her sex, in violation of Title VII of the Civil
Rights Act of 1964, 42 U.S.C. § 2000e et seq., and her age, in violation of the Age
Discrimination in Employment Act (ADEA), 29 U.S.C. § 621 et seq. The district
court granted summary judgment to AdminaStar because Miller failed to identify a
similarly situated employee who was treated less favorably under the “no felony”
policy and also failed to show that AdminaStar’s stated nondiscriminatory reason
for firing her was pretextual. We affirm the judgment.
No. 05-2648 Page 2
AdminaStar provides fiscal intermediary services, such as claims processing
and customer service, to Medicare providers and beneficiaries. Miller began her
employment with AdminaStar’s parent company in 1976 and remained at the
Indianapolis office when it was reconfigured and renamed AdminaStar Federal in
1999 or 2000. When AdminaStar fired her in 2002, she was 46 years old and had
held the position of Manager of Operations Services for eight years. AdminaStar
has a policy prohibiting the employment of convicted felons. Throughout Miller’s
employment, the policy was communicated to employees through training, the
Associate Handbook, the “Standards of Business Conduct” document, and
acknowledgment forms that ask employees to self-disclose any felony convictions.
Miller was arrested in April 2002 for shoplifting. The arresting officer
searched her purse and found methamphetamines. A week later, Miller informed
her supervisor, Roderick King, that she had been arrested for shoplifting and drug
possession. Miller also told Lydia Thompson of the human resources department,
who informed her that she could be fired if convicted of a felony. In October 2002,
Miller pleaded guilty in state court to one count of possession of a controlled
substance, a Class D felony. Several days later, King terminated Miller’s
employment.
In granting AdminaStar’s motion for summary judgment, the district court
determined that Miller failed to identify a similarly situated employee—either male
or substantially younger—who was treated more favorably than her under the
company’s “no felony” policy. The court also found that even if Miller could
establish a prima facie case of discrimination, she failed to raise a genuine issue of
material fact as to whether AdminaStar’s stated nondiscriminatory reason for firing
her was pretextual.
A plaintiff can prove discrimination under Title VII either through direct
evidence or with indirect evidence using the burden-shifting approach set forth in
McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1973). Under the indirect
method, the plaintiff must show prima facie evidence that she (1) is a member of a
protected class, (2) was meeting her employer’s legitimate performance
expectations, (3) suffered an adverse employment action, and (4) was treated less
favorably than similarly situated individuals who are not members of her protected
class. Ballance v. City of Springfield, 424 F.3d 614, 617 (7th Cir. 2005). This
framework also applies to age discrimination claims under the ADEA. Jordan v.
City of Gary, 396 F.3d 825, 833 (7th Cir. 2005).
Miller contends that the fact she was replaced by a substantially younger,
male employee alone is sufficient evidence of discrimination to satisfy the fourth
prong of the McDonnell Douglas test. Her sole authority for this assertion is Olson
No. 05-2648 Page 3
v. Northern FS, Inc., 387 F.3d 632 (7th Cir. 2004), in which we warned against a
rigid adherence to McDonnell Douglas: “In an attempt to better reach the ultimate
question of when . . . an employee within the protected class has been discharged
and replaced, we have required that the employee show only that ‘he was
performing his job to the employer’s legitimate expectations’ and that the employer
‘hired someone else who was substantially younger or other such evidence that
indicates that it is more likely than not that his age . . . was the reason for the
discharge.’” Id. at 635–36.
Olson is distinguishable, however, because there the plaintiff established a
fact issue as to whether “age was a motivating factor in the decision to fire [him].”
Id. at 635. Olson presented evidence that his younger replacement was under-
qualified and that his employer explicitly stated that Olson was undesirable
because of his age. Id. at 635–36. By contrast, Miller presented no evidence that
her age or sex played any role in the decision to fire her. Because she failed to
present any such evidence, the district court properly concluded that Miller failed to
establish a prima facie case of discrimination.
In the alternative, Miller asserts that she satisfied the fourth prong of
McDonnell Douglas by identifying two employees who, she contends, were similarly
situated to her but were not terminated under the “no felony” policy. Specifically,
Miller argues that employees David Edwards, a 63-year-old man, and JoAnn
Scherrer, a 45-year-old woman, were similarly situated to her because they both
“admitted to a felony” on the acknowledgment forms that AdminaStar requires its
employees to submit. But after reviewing the acknowledgment forms, interviewing
both individuals, and obtaining their criminal record reports, AdminaStar
determined that Edwards and Scherrer were mistaken in believing that they had
felony convictions. Rather, as the district court noted, Edwards was convicted of
misdemeanor drunk-and-disorderly conduct, while Scherrer was convicted of a non-
felony charge of driving under the influence. Because neither individual had
committed a felony, the district court properly found that Miller failed to identify
any similarly situated individuals who were treated more favorably under the “no
felony” policy.
Miller also asserts that the district court erroneously concluded that she
failed to present evidence that AdminaStar’s proffered reason for firing her was a
pretext for sex and age discrimination. She contends that she demonstrated pretext
by showing that the “no felony” policy was not in writing, was arbitrarily enforced,
and was not communicated to her or her supervisor.
Even if Miller could make out a prima facie case of discrimination, her claim
would fail because she lacks evidence of pretext. If a plaintiff establishes a prima
facie case under McDonnell Douglas, the burden shifts to the employer to provide a
No. 05-2648 Page 4
legitimate, nondiscriminatory reason for its decision which, if satisfied, shifts the
burden back to the plaintiff to show that the reason was “pretextual.” Ballance, 424
F.3d at 617. The focus of a pretext analysis is whether the employer’s stated reason
for the termination was honest. Hague v. Thompson Distrib. Co., 436 F.3d 816, 823
(7th Cir. 2006). Pretext is not a mere “business error” but rather “a lie or deceit
designed to cover one’s tracks.” Cardoso v. Robert Bosch Corp., 427 F.3d 429, 435
(7th Cir. 2005).
Miller presented no evidence that AdminaStar did not honestly believe that
she violated the “no felony” policy. Her suggestion that the policy is unwritten and
not communicated to employees, and therefore does not exist, has no merit because
the policy is set forth in AdminaStar’s Associate Handbook and in the company’s
“Standards of Business Conduct” policy, and Miller signed a form in June 2000
acknowledging her awareness of the policy. Miller’s assertion that the policy was
arbitrarily enforced is likewise unsupported by the record. Although she argues
that a small percentage of acknowledgment forms are returned to AdminaStar with
the felony disclosure question not completed, thus casting doubt over the
enforcement of the policy, she presents no evidence that any of the incomplete forms
were submitted by convicted felons, or that AdminaStar’s alleged failure to follow
up on the incomplete forms is anything other than a mere “business error” not
rising to the level of deceit. See Kulumani v. Blue Cross Blue Shield Ass’n, 224 F.3d
681, 685 (7th Cir. 2000) (inevitable errors in processes of large organizations do not
demonstrate cover-up of an unlawful motive).
Accordingly, the judgment of the district court is AFFIRMED.