Jeffrey Loeb v. Best Buy Co.

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
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No. 07-3109
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Jeffrey Loeb, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the
* District of Minnesota.
Best Buy Co., Inc., *
*
Appellee. *
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Submitted: May 14, 2008
Filed: August 8, 2008
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Before WOLLMAN, MURPHY, and SMITH, Circuit Judges.
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SMITH, Circuit Judge.
Jeffrey Loeb, a former Best Buy employee, brought this employment
discrimination suit against Best Buy, asserting that Best Buy terminated his
employment because of his age. Best Buy filed a motion for summary judgment,
which the district court1 granted. Loeb appeals, arguing that he presented sufficient
evidence to support his age discrimination claim. We affirm.
1
The Honorable Michael J. Davis, United States District Judge for the District
of Minnesota.
I. Background
Best Buy hired Loeb, then 44 years old, as an information services program
manager in February 2000. At that time, Best Buy's retail operations model focused
on selling to specific customer group profiles—termed "customer centricity." One
customer centricity group focused on "Barry," named after a fictitious high-end
customer. Julie Gilbert led the Barry team along with Dean Kimberly.
In mid-2003, Gilbert and Kimberly, and others, met to conceive products and
services for Barry customers. The Barry team's initial focus would be the creation of
a high-end store-within-a-store, called the Magnolia Home Theater ("MHT"). The
MHT would feature high-end home theater products and highly trained sales people.
The Barry team planned to open two prototypes of the MHT by May 2004. If
successful, the MHT would be replicated on a larger scale. The first MHT stores were
to serve as laboratories where the Barry team could refine better methods for inserting
MHTs into existing Best Buy stores. Other Best Buy workgroups—such as real estate,
design, construction, merchandising, inventory, and sales—coordinated with the Barry
team to implement these first MHTs.
In late December 2003 or early January 2004, Loeb worked on a different
customer centricity team. Intrigued by the project, Loeb asked Gilbert if he could help
on the Barry team, and although no opening existed on the Barry team, Gilbert and
Kimberly agreed to involve Loeb in the Barry team's work. Loeb was assigned the
task of coordinating the different groups that needed to work together in order to get
the MHT lab stores completed. In April 2004, Loeb, then 48 years old, was officially
moved to the Barry team and began reporting directly to Kimberly and Gilbert.
Neither Gilbert nor Kimberly knew Loeb's age at the time.
After he began working on the Barry team, Loeb asked that his role be
formalized and that he be given a title and job description. He drafted a document
describing his role and responsibilities on the Barry team. The document described his
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role to include business planning and execution of the MHT lab stores; management
of "the process to transition successful value propositions out of the test stores into
Barry stores"; heading "a multi-function working group to integrate new technologies
into seamless Value Propositions for Barry"; and carrying out other assigned ad hoc
duties. Loeb gave this draft document to Gilbert, and Gilbert found the document to
generally describe "his role as the person coordinating the work of the various groups
that we needed to put together the MHT store-within-a-store concept." Gilbert does
not remember specifically discussing Loeb's job title, and Loeb's written draft is the
only document that describes his role on the Barry team. Gilbert testified that she did
not view Loeb as on loan from the information services department and did not
believe that his transfer to the Barry team was temporary.
Loeb, the oldest member of the Barry team, successfully performed his team
duties. The culture of the Barry team was very team-oriented and included "Barry
huddles" each morning where everyone on the team would get an update and do a
cheer of the day. Loeb testified that the Barry team management focused on partnering
people, lacked hierarchy, and relied on a very feelings-based management style, which
he described as "new age." Everyone on the Barry team, regardless of age, was
required to participate in these activities.
In mid-May 2004, the first two MHT stores were opened, and because of their
success, two more were opened in August 2004. At that time, Best Buy concluded the
first phase of the MHT project and decided to roll out MHT stores on a larger scale.
Because Best Buy had a successful model for the MHT, the Barry team shifted its
focus to nationwide deployment of the MHT—they called this "scale-up mode." Also
in May 2004, Loeb was told there would no longer be a place for him on the Barry
team due to the shift in the nature of the group's work. Gilbert and Kimberly felt Loeb
was not interested in the routine nuts and bolts job of scaling-up the MHTs and
believed Loeb would not be happy working on that phase of the project. Kimberly told
Loeb that because his work on the MHT lab stores was coming to an end, Loeb should
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begin looking for work elsewhere within Best Buy or outside of Best Buy. Kimberly
and Gilbert made the decision regarding Loeb's role on the Barry team, and they
agreed to talk to the human resources department to ensure Loeb had sufficient time
to transfer within Best Buy.
Loeb was surprised to hear that there would not be work for him because
customer centricity was at the center of everything Best Buy was doing, and he knew
that Best Buy planned to maintain approximately 18 prototype stores and open over
200 Barry stores over a two-year period. There was also a three-year strategy to
develop more "value propositions" such as dedicated checkout areas and dedicated
phone lines just for Barry customers.
On September 23, 2004, Best Buy advised Loeb by letter to find another
position within Best Buy or he would be terminated after 60 days. The letter based the
"get reassigned or get terminated notice" on corporate cost cutting at the location
where Loeb worked. This letter was signed by Randy Ross, Vice President of Human
Resources.
On November 23, 2004, Loeb's last day of employment at Best Buy, he
received a letter from Karen Dekker, Director of Human Resources stating that "Best
Buy, in an effort to become more efficient and customer-centric has made numerous
changes to streamline processes and eliminate redundant tasks . . . . [Loeb's] position
was eliminated effective 11/23/2004 as part of our reorganization efforts."
In Spring 2005, Loeb filed a claim with the Equal Employment Opportunity
Commission (EEOC), alleging age discrimination. A March 8, 2005, letter from Jane
Kirshbaum, Best Buy's Senior Counsel, to the EEOC stated that Loeb's employment
was terminated as a result of a staff reduction. In a "Staffing Analysis" worksheet
completed by Gilbert on September 9, 2004, Gilbert wrote that:
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Jeff was asked to act in a project manager role on the Barry team to
coordinate the launch of the first four Magnolia Home Theater stores in
California. This work started in January, and was effectively completed by
mid-September. At this point, the leadership of the Barry team has
determined that Jeff's current role is no longer needed on the team, since
MHT is now in a scale-up mode (as opposed to launch mode). In the time
Jeff has worked with the Barry team, his previous role was eliminated when
his department's (IS) services were outsourced to Accenture.
Loeb and Gilbert made contacts within Best Buy, but Loeb did not find another
position within Best Buy. He was terminated on November 23, 2004.
Subsequently, in April 2005, Loeb brought suit against Best Buy, asserting a
claim of age discrimination under both the Age Discrimination in Employment Act
(ADEA), 29 U.S.C. §§ 621–634, and the Minnesota Human Rights Act (MHRA),
Minn. Stat. § 363A.08. In August 2007, the district court granted Best Buy's motion
for summary judgment, finding that Loeb failed to state a prima facie case and failed
to show Best Buy's reasons for his termination were pretext for age discrimination.
Loeb now appeals.
II. Discussion
Loeb argues on appeal that the district court erred in granting summary
judgment to Best Buy. We review de novo the district court's grant of summary
judgment. Carraher v. Target Corp., 503 F.3d 714, 716 (8th Cir. 2007). "Summary
judgment is proper if there is no genuine issue as to any material fact and the moving
party is entitled to judgment as a matter of law. We must view the evidence, and the
inferences that may be reasonably drawn from it, in the light most favorable to the
nonmoving party." Id. (internal citations omitted). In deciding whether an issue of
material fact exists that would prevent the entry of summary judgment, "we are
mindful that we do not sit as a super-personnel department to review the wisdom or
fairness" of Best Buy's decision to terminate Loeb. Wittenburg v. Am. Express Fin.
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Advisors, Inc., 464 F.3d 831, 836 (8th Cir. 2006) (internal citation and quotations
omitted).
Under the ADEA, "[i]t shall be unlawful for an employer to fail or refuse to hire
or to discharge any individual or otherwise discriminate against any individual with
respect to his compensation, terms, conditions, or privileges of employment, because
of such individual's age." 29 U.S.C. § 623(a)(1). Under the MHRA "[e]xcept when
based on a bona fide occupational qualification, it is an unfair employment practice
for an employer, because of . . . age to . . . discharge an employee." Minn. Stat. §
363A.08 Subd. 2(2).
"To establish a claim of intentional age discrimination, a plaintiff may present
direct evidence of such discrimination or may prove his claim through circumstantial
evidence." Carraher, 503 F.3d at 716. Where, as here, the plaintiff presents only
circumstantial evidence of discrimination, we apply the familiar burden-shifting
analysis of McDonnell Douglas Corp. v. Green. 411 U.S. 792, 802 (1973). Id.
This analysis requires that, first, the plaintiff establish a prima facie case of
discrimination. Id. at 717. To establish a prima facie case, Loeb must show that (1) at
the time he was fired he was over 40 (a member of the class protected by the ADEA
("individuals who are at least 40 years of age," 29 U.S.C. § 631(a)); (2) he was
otherwise qualified for the position that he had; (3) he was discharged by Best Buy;
and (4) Best Buy subsequently hired a younger person to fill his position. Reeves v.
Sanderson Plumbing Prods., Inc., 530 U.S. 133, 142 (2000). Here, we assume without
deciding that Loeb established a prima facie case of age discrimination. See
Wittenburg, 464 F.3d at 836 (assuming without deciding that plaintiff in ADEA case
met prima facie case).
Assuming Loeb made a prima facie case, Best Buy is required to proffer a
legitimate, nondiscriminatory reason under the McDonnell Douglas test for Loeb's
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termination. Id. Best Buy avers that it terminated Loeb, after giving him time to find
another position within Best Buy, because the Barry team's work was shifting to
different functions. Further, Gilbert and Kimberly did not believe Loeb would be
interested in working on the scale-up phase of the project. The district court found that
this was a legitimate, nondiscriminatory reason for terminating Loeb, and we agree.
The burden next shifts to Loeb to establish that this nondiscriminatory reason
for his termination was pretextual and that age played a role in his termination. Id.
"That is, the plaintiff may attempt to establish that he was the victim of intentional
discrimination by showing that the employer's proffered explanation is unworthy of
credence." Reeves, 530 U.S. at 143 (internal quotations and citation omitted). "At this
stage, [Loeb] can avoid summary judgment only if the evidence considered in its
entirety (1) created a fact issue as to whether [Best Buy's] proffered reasons are
pretextual and (2) created a reasonable inference that age was a determinative factor
in the adverse employment decision." Lewis v. St. Cloud State Univ., 467 F.3d 1133,
1137 (8th Cir. 2006) (internal quotations and citation omitted).
Loeb argues that he has established pretext because: Best Buy's stated reasons
for his termination were false and inconsistent; Kimberly and Gilbert had age-based
animus from the outset; and Best Buy chose a less experienced employee to replace
him.
First, Loeb argues that the six reasons given for Loeb's termination are
inconsistent and false and, therefore, show pretext. Pretext may be shown with
evidence that the employer's reason for the termination has changed substantially over
time. Morris v. City of Chillicothe, 512 F.3d 1013, 1019 (8th Cir. 2008). The falsity
of a nondiscriminatory basis for the employment action may also support a finding of
pretext—"[I]f the proffered reason is shown by conflicting evidence to be untrue, then
the nonmoving party is entitled to all favorable inferences that the false reason given
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masks the real reason of intentional discrimination." Bassett v. City of Minneapolis,
211 F.3d 1097, 1107 (8th Cir. 2000). Loeb describes the six statements as follows:
(1) It terminated Loeb's employment "to reduce the labor costs" and "to
reduce [its] headcount." (termination letter from Randy Ross, Vice
President of Human Resources);
(2) It terminated Loeb as part of a reorganization intended "to streamline
processes and eliminate redundant tasks." (notice from Karen Dekker,
Director of Human Resources);
(3) It terminated Loeb as part of a "staff reduction" (letter from Senior
Counsel Jane Kirshbaum to EEOC);
(4) It terminated Loeb because his role ended as the result of the
Magnolia stores switching to scale-up mode;
(5) It terminated Loeb because he agreed to be terminated based on his
lack of interest in scale-up work; and
(6) Loeb was not qualified to perform the strategic work going forward.
Loeb is correct that the record indicates that he was not terminated to reduce
labor costs, to reduce headcount, or to streamline processes. Instead, the record shows
that those responsible for his termination, Gilbert and Kimberly, terminated his
position on the Barry team because they believed that he would not enjoy and was not
well-suited for the next phase of the MHT project.
As to statements one and two, those letters were signed by Ross and Dekker,
two people who were not the relevant decision-makers who terminated Loeb. "As we
have previously stated, a plaintiff must establish some causal relationship to show the
significance of . . . statements made by persons other than the relevant decision-maker
to the resolution of the ultimate issue of intentional discrimination." See Carraher,
503 F.3d at 718 (internal quotations and citation omitted). Loeb has not shown such
a connection. Loeb admits that Gilbert and Kimberly decided to terminate him, not
Ross and Dekker. The record does not contain any evidence showing a causal
relationship between the statements by Ross and Dekker and Best Buy's alleged
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animus for Loeb's age. The record indicates that only Gilbert and Kimberly made the
decision to remove Loeb from the Barry team and, therefore, we agree with the district
court that we need not consider statements one and two.
The letter to the EEOC, statement three, does state that Loeb was terminated "as
a result of a staff reduction." However, we agree with the district court's analysis that,
taken in context, this letter to the EEOC is consistent with the stated
nondiscriminatory basis for Loeb's termination. The letter to the EEOC also states that
Gilbert and Kimberly made the decision to eliminate Loeb's position and that
"responsive information [would] follow under separate cover." The "responsive
information" was contained in a letter sent that same day by the same person,
Kirshbaum, and the letter explained that the MHT project was moving from launch
mode to scale-up mode and that the work that had been done by Loeb was no longer
needed. The letter also explained that because Best Buy had eliminated much of its
information services department as a result of outsourcing to Accenture, Loeb could
not return to his former position because it had been eliminated. Reading the two
letters together, Best Buy's explanation was consistent with the stated
nondiscriminatory reason. Loeb argues that there was no "staff reduction" on the
Barry team, but reading the entire document, we agree with the district court that the
"staff reduction" being discussed is the elimination of Loeb's position. The EEOC
letter does not show a change in Best Buy's explanation of Loeb's termination.
As to statements four and five ("it terminated Loeb because his role ended as
the result of the Magnolia stores switching to scale-up mode" and "it terminated Loeb
because he agreed to be terminated based on his lack of interest in scale-up work"),
we agree with the district court that these statements also do not show pretext. First,
statement four is not a shift, it is consistent with Best Buy's legitimate
nondiscriminatory reason, and the record does not support an assertion that the
statement is false. The record indicates that the majority of the work coordinating the
MHT scale-up was not done on the Barry team even though the leaders of the Barry
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team were still responsible for the project in general. Second, as to statement five,
Best Buy never represented that Loeb agreed to be terminated, just that they believed
he would not enjoy the scale-up work—that statement is unsupported.
As for statement six, that Loeb was not qualified to perform the strategic work
going forward, we find that reason is not inconsistent with Best Buy's stated
reason—it is not a change in their justification for the termination but rather an
elaboration. See Rodgers v. U.S. Bank, N.A., 417 F.3d 845, 855 (8th Cir. 2005)
("While it is true that [s]ubstantial changes over time in the employer's proffered
reason for its employment decision support a finding of pretext this does not mean that
an employer cannot elaborate on its proffered reason.") (citations and quotations
omitted). Gilbert testified that the kind of strategic work that Loeb had done while on
the Barry team was no longer available.
We conclude that the actual decision-makers who terminated Loeb did not give
inconsistent reasons, and therefore, Loeb has not shown pretext on the basis of
conflicting justifications for the employment action.
Second, Loeb argues that Kimberly and Gilbert had age-based animus from the
outset. Loeb testified that during his employment on the Barry team, Gilbert asked
him how old he was, and when he told her, she was surprised because he looked and
acted younger. This is the only age-related comment made by Gilbert about Loeb's
age. Loeb has not alleged any statement by Kimberly indicative of age bias.
Loeb claims that he was brought onto the Barry team and that his bosses
planned to free up his position for a younger replacement. He claims Kimberly could
have moved headcount off the Barry team so that maybe another department could
have hired Loeb. Loeb contends the "youth-based culture" of Best Buy (Barry
huddles, etc.) support his contention that Kimberly and Gilbert wanted to create a
position so they could later fill it with a young person.
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Loeb's argument fails for want of proof. We agree with the district court's
finding that Loeb has not presented evidence, besides pointing to very general job
descriptions, to contradict Best Buy's proof that the individuals, D.M.2 and P.M., hired
after Loeb's termination filled entirely different positions. Kimberly and Gilbert could
not have created Loeb's position just so that they could later fill it with a younger
person—Loeb's position was eliminated. Also, the record contains no evidence to
support the allegation that Loeb was brought in just to increase the headcount on the
Barry team. In fact, the undisputed evidence shows that Loeb first approached Gilbert
asking to join the Barry team.
2
In the fall of 2004, while Loeb was still looking for a job before he was
officially terminated, Gilbert sought to add a position called "Segment Team Member;
Ideation/Innovation." This position would take over some of Kimberly's
responsibilities and would invent new ideas for products and services for Barry
customers. The position was posted inside and outside Best Buy in early 2005, and
Loeb did not apply for this job. Even if he had, Kimberly and Gilbert stated that the
person in this new role would not be doing the kind of work Loeb had done and that
Loeb was not specifically qualified for this role. In March 2005, D.M. was hired for
this position—she had been with Best Buy for 17 years, and she was 41 years old. She
took over Kimberly's duties as he moved to another position. D.M. runs the Barry
prototype stores, and her work is "strategic"—the Barry prototypes continued to
operate even after the scale-up of MHT because Best Buy used them to come up with
new ideas.
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Lastly, Loeb argues that the hiring of P.M.3 as his replacement shows pretext
because P.M. was less qualified. Pretext may be proven by evidence showing a
younger, less-qualified, weaker-performing employee replaced an older employee.
Hase v. Mo. Div. of Employment Sec., 972 F.2d 893, 897 (8th Cir. 1992) (finding
younger individual who had sixteen years less experience and lower performance
rating was promoted over plaintiff could lead a reasonable trier of fact to infer that
defendant's proffered reasons were pretextual). Loeb argues that P.M. replaced him
and is a less-qualified employee and a liability to Best Buy. First, as stated above, we
agree with the district court's finding that the record does not include evidence
contradicting Best Buy's contention that P.M.'s work is different from the work Loeb
did on the Barry team. Further, unlike in Hase, the record does not include relevant
information that would lead a reasonable juror to conclude that P.M. was less qualified
than Loeb or that there remain material factual issues whether P.M. was a liability to
Best Buy. Id.
3
In about July 2005, Best Buy created the "Director, Innovation–Barry
Segment" position, and this position was never posted. Instead, P.M. was assigned the
position; he had been with Best Buy for 18 years and held many positions in the field
of retail operations. He was 41 at the time he was hired and had one disciplinary item
and one poor performance in his personnel file. The Barry team had continued to
develop ideas for an MHT store that would be built to look like a house and feature
products and show how they could be incorporated into the home. The new position
related to this new idea, and the duties included working on innovating for sales and
sale development aspects of the MHT home store. Gilbert testified that even if Loeb
had applied for this position, he would not have been considered because he lacked
the "field level" retail experience necessary. The stand-alone MHT home store
prototype was complete in January 2006, and P.M. had a retail focused operations role
wherein he was required to create incentive plans designed to forward Barry
customers from regular Best Buy stores to the stand-alone home stores.
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In sum, Loeb has not established that Best Buy's stated reasons for his
termination were pretext for age discrimination nor shown that issues of material fact
remain for resolution by trial.4
III. Conclusion
Accordingly, we affirm the judgment of the district court.
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4
Because the same analysis applies to MHRA claims as ADEA claims, Loeb's
MHRA age discrimination claim also fails. Wittenburg, 464 F.3d at 841 n.15.
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