Hossack, Vicki v. Floor Covering Assoc ( 2007 )

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 04-3990
VICKI HOSSACK,
Plaintiff-Appellant,
v.
FLOOR COVERING ASSOCIATES OF JOLIET, INC.,
Defendant-Appellee.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 03 C 3067—Paul E. Plunkett, Judge.
____________
ARGUED APRIL 13, 2006—DECIDED JULY 5, 2007
____________
Before COFFEY, KANNE and WILLIAMS, Circuit Judges.
COFFEY, Circuit Judge. Plaintiff Vicki Hossack had an
extramarital affair with a fellow employee, Nick Cladis,
while working for Floor Covering Associates of Joliet, Inc.
Subsequently, Hossack was terminated, but the employer
did not discharge Cladis. Hossack claimed sex discrimina-
tion and sued for relief under Title VII, see 42 U.S.C.
§§ 2000e-2(a), et seq. The jury returned a verdict in her
favor, but the trial court, after a hearing, set aside the
verdict and entered judgment as a matter of law in favor
of the defendant. See Federal Rule of Civil Procedure 50(b).
Hossack appeals, and on review we are convinced that
no reasonable jury could have concluded that Hossack was
a victim of intentional sex discrimination. WE AFFIRM.
2 No. 04-3990
I. BACKGROUND
Floor Covering Associates hired Vicki Hossack in
October of 1997, and she was promoted to the position of
office manager at the Joliet store in June of 2000.1 The
Joliet store was co-managed by Nick Cladis and Dave
Lenz, Hossack’s immediate supervisor. Lenz reported
directly to Floor Covering Associates’s president and
owner, Robert Hill.
At trial, Hill testified that he was the sole owner of the
parent company Floor Covering Associates, Inc. (FCA),
located in Shorewood, Illinois.2 The company manages
the purchasing of inventory and distribution of products
to its affiliated retail stores as well as providing sup-
port services such as payroll, human resources, and
bookkeeping to its retail stores. Hill is the sole owner of
three of the retail stores: Floor Covering Associates of
Joliet, Inc.3, Floor Covering Associates of Merrillville, Inc.,
and Floor Covering Associates of Naperville, Inc. Each of
the three stores is separately incorporated, while Hill
is the part owner of a store in Kankakee, which is also
separately incorporated. When the events relative to this
trial occurred, FCA, the parent company, employed
twenty-seven people, the Joliet store employed thirty, the
1
Hossack’s work performance is not at issue in this case, as
she always received top ratings in her performance appraisals.
2
FCA began operating in 1976. The company sells floor covering
and home furnishings, such as carpeting, hardwood flooring,
ceramic tile, leather and upholstered sofas, bedroom sets, and
window treatments. In 2007, FCA consists of six stores located
throughout Illinois and Indiana. See Floor Covering Associates,
Inc.—About Us, http://www.fcainc.com/about.asp (last visited
Apr. 13, 2007).
3
The Joliet store was actually located in Shorewood, Illinois,
where it shared a building with FCA.
No. 04-3990 3
Naperville store employed fifty-four, and the Kankakee
store employed nineteen. Each store is responsible for
invoicing and for collecting all of the receivables, but the
stores share neither inventory nor warehousing.
Hill referred to Hossack as the “head bookkeeper, the
office manager” at the Joliet store. He testified that her
duties included collecting all receivables, invoicing custom-
ers, preparing lien waivers, managing the inventory,
counting the inventory on a monthly basis, answer-
ing questions for everybody, and issuing credit. As noted
above, Cladis was employed by the Joliet store as a co-
general manager with David Lenz. Cladis primarily
concentrated on sales to builders.
In early 2001, Hossack and Cladis, both of whom were
married and living with their respective spouses, as
stated earlier, engaged in an extramarital affair. The
affair lasted approximately eighteen months, until June
11, 2002, when Hossack’s husband, Joseph Zastrow,4
became aware of the affair upon discovery of letters
from Cladis to Hossack, which she had secreted in her
dresser drawer. He confronted his wife with the informa-
tion and she, in turn, called the Joliet store the follow-
ing morning and informed them that she was taking a
personal day off. The following day, on June 13, 2002,
Hossack again called the Joliet store and spoke with her
supervisor, David Lenz, and requested permission to take
her remaining eight vacation days in order to resolve her
4
In the interest of clarity, we note that, based on the informa-
tion in the record, Hossack and her husband, Joseph Zastrow, do
not share a surname. Thus, throughout this opinion Joseph
Zastrow is identified either by his surname, Zastrow, or by
reference to his relationship to Hossack, while the use of
“Hossack” indicates an explicit reference to Vicki Hossack, the
plaintiff-appellant.
4 No. 04-3990
personal issues at home. Lenz approved her request for
vacation time. At this point in time, no one employed by
FCA or the stores other than Hossack and Cladis had
any knowledge of the affair.
On June 17, 2002, Hossack returned to the Joliet store
during her time off to fill out her time sheet and to com-
plete the company’s vacation request forms. While there,
Hossack spoke with Lenz. She told him that she had been
having an affair with Cladis, that after her husband
found out about the affair he became emotionally upset,
and that their daughter feared he might be suicidal. She
explained that she was requesting the vacation time to
deal with her marital problems and also informed Lenz
that her husband did not want her to continue to work
and be in contact with Cladis.
Lenz testified at trial that he interpreted Hossack’s
statements during this conversation as a resignation, but
when Hossack took the stand, she disagreed and made
it clear that she had not resigned. On direct examination,
Lenz stated that:
Lenz: She (Hossack) came to my office first thing in
the morning to speak to me. She walked in the office,
closed the door behind her and told me that she was
going to have to quit. I didn’t understand exactly why
at that point in time and with just a very little bit of
questioning, she came forward and she said, “Well,
you’re going to find out soon enough that I’m quitting
because Joe’s found out that I’ve been having an
affair with Nick Clavis [sic].”
Transcript at 139-40. After meeting with Hossack, Lenz
met with FCA’s owner and president, Robert Hill, and
informed him of his conversation with Hossack and said
that she had resigned. Hill asked Lenz to arrange a
meeting with Hossack the following day.
No. 04-3990 5
At Lenz’s request, on June 18, 2002, Hossack met with
Hill and Mary Gallup, FCA’s director of human resources.
Hossack did admit that, at the meeting, she told Hill and
Gallup that it might be in the best interest of the com-
pany for her to quit because her husband did not want her
to work with Cladis anymore. Hill, in reply, advised
Hossack that she was a valued employee, that FCA
wanted to retain her as an employee, and that he hoped
he would be able to resolve the problem in a way that
would be to everyone’s satisfaction. Hill proposed three
possible options: (1) Hossack and Cladis could continue to
work together at the Joliet store; (2) Hossack could resign;
or (3) Cladis could be transferred to the Naperville store.
Hossack told Hill that she preferred the option of Cladis
transferring to another store, but admitted at trial that
Hill had made it clear that this option was not guaranteed
because it had yet to be discussed with Cladis and Lenz. At
the close of the meeting, Hill assured Hossack that
management would remain in contact with her in the
coming days while it reached a decision.
While Hossack was still on leave, her husband called
Cladis on two separate occasions and warned him on each
occasion to stay away from his wife. Furthermore, during
one of these calls, Zastrow told Cladis that he “was going
to make [Cladis’s] life as miserable as he had made his”
and that he would tell Cladis’s wife of the affair. Cladis
reported the telephone calls to Lenz.
On June 20, 2002, Gallup, Lenz, and Dan Majetich,
FCA’s executive vice president, met and discussed the
problem in an attempt to help resolve the situation.
Hossack’s supervisors determined that transferring Cladis
to the Naperville store was not in the best interest of the
Joliet store because Cladis was the best-producing sales-
man at the Joliet store and that, based on the concerns
that he had about Zastrow’s behavior and threats,
Hossack’s continued employment at the Joliet store would
6 No. 04-3990
be disruptive. Cladis, who arrived several minutes after
the meeting began, told the group that he had just spoken
with Hossack and that she had indicated that she would
not be returning to work. Thus, the assembled group
decided to accept Hossack’s resignation.
That evening, Hossack telephoned Lenz to inform him
that she and her husband had reconciled and that he no
longer objected to her working with Cladis at the Joliet
store. According to Hossack, she was surprised when Lenz
told her that the store had decided to accept her state-
ment of resignation because of her husband’s threaten-
ing behavior.
The following day, when Hossack went to the Joliet store
to pick up her paycheck, she met with Lenz, who told her
that Cladis was simply a better choice for the company
because, in addition to his duties as co-manager, he was
the top salesman and revenue generator at the Joliet
store at this time. Lenz then asked Hossack to sign a
voluntary resignation form, but she refused.
Later that morning, FCA sent a letter to Hossack,
authored and signed by Gallup (FCA’s director of human
resources), confirming that, based on her statements of
resignation to both Lenz and Hill, Hossack was terminated
as of that date. The letter also stated that FCA did not
plan to rehire Hossack because “it would be most disrup-
tive to bring [her] back into this operation.”
Cladis was neither discharged nor disciplined by the
defendant for his role in the consensual affair with
Hossack. Thereafter, on July 3, 2002, Hossack filed a
charge of sex discrimination with the Illinois Depart-
ment of Human Rights and with the federal Equal Em-
ployment Opportunity Commission (EEOC). Sometime
later, Cladis was transferred to the Naperville store. The
defendant claims that it transferred Cladis due to the
negative reaction of his fellow Joliet employees, who
No. 04-3990 7
blamed him for Hossack’s termination. In October of 2002,
Cladis and Lenz left FCA’s employment to work for a
competitor.
After 180 days passed without any proceedings or
resolution of the dismissal, the EEOC issued Hossack a
Notice of Right to Sue. She filed suit in federal court
against Floor Covering Associates of Joliet, seeking re-
lief for sex discrimination pursuant to Title VII of the
Civil Rights Act of 1964, as amended. 42 U.S.C. §§ 2000e-
2(a), et seq. The case proceeded to trial, and the defendant
moved for judgment as a matter of law at the close of the
plaintiff ’s case in chief. See Federal Rule of Civil Procedure
50(a). The court took the motion under advisement and
explained that, even though Hossack failed to establish a
prima facie case under the indirect, burden-shifting test
set forth in McDonnell Douglas Corporation v. Green, 411
U.S. 792, 802 (1973) or demonstrate that the defendant’s
reasons for its actions were pretexts for discrimination,
she could nevertheless submit her case to the jury under
a direct method or mixed-motive theory to the panel. The
defendant renewed its Rule 50(a) motion for judgment
as a matter of law at the close of the evidence. The court
took that motion under advisement pending the jury’s
verdict. The court submitted the case to the jury after
giving a mixed-motive instruction. The jury found in favor
of Hossack and awarded her $250,000 in damages. The
court accepted the verdict and entered judgment, and the
defendant renewed its motion for judgment as a matter of
law. See Federal Rule of Civil Procedure 50(b). The court
subsequently issued a written decision granting the
defendant’s motion and vacated the jury’s verdict. The
court reasoned that, when considering the evidence, no
reasonable jury could have found that Hossack was a
victim of intentional discrimination without indulging in
speculation.
8 No. 04-3990
II. ANALYSIS
On appeal, this court conducts a de novo review of a
district court’s decision when faced with the question of
whether or not to grant a motion for judgment as a matter
of law, see Walker v. Bd. of Regents of the Univ. of Wiscon-
sin Sys., 410 F.3d 387, 393 (7th Cir. 2005), and is “obliged
to leave the judgment undisturbed unless the moving
party can show that ‘no rational jury could have brought
in a verdict against [it].’ ” Woodward v. Corr. Med. Servs.
of Illinois, Inc., 368 F.3d 917, 926 (7th Cir. 2004). In
reviewing the district court’s decision, this court
“examin[es] the record as a whole to determine whether
the evidence presented, combined with all reasonable
inferences permissibly drawn therefrom, was sufficient to
support the jury verdict of sex discrimination.” Walker, 410
F.3d at 393. “[A] mere scintilla” of evidence supporting
the jury’s verdict will not suffice. Id. Although the court
reviews the record as a whole, it must disregard all
evidence favorable to the moving party that the jury
was not required to believe. See Reeves v. Sanderson
Plumbing Prods., Inc., 530 U.S. 133, 151 (2000). That is,
the court must give credence to the “evidence supporting
the moving party that is, uncontradicted and
unimpeached, at least to the extent that the evidence
comes from disinterested witnesses.” 9A C. Wright & A.
Miller, Federal Practice and Procedure § 2529, p. 300 (2d
ed. 1995). This court can neither reweigh the evidence nor
make its own credibility determinations. See Appelbaum
v. Milwaukee Metro. Sewerage Dist., 340 F.3d 573, 579 (7th
Cir. 2003).
In this case, Hossack is seeking relief pursuant to Title
VII. Title VII provides that it is an “unlawful employment
practice for an employer . . . to discriminate against any
individual . . . because of such individual’s race, color,
religion, sex, or national origin.” 42 U.S.C. § 2000e-2(a)(1).
No. 04-3990 9
An unlawful employment practice is established when a
plaintiff demonstrates that a protected characteristic,
such as sex, was a motivating factor for an employment
decision. The trial court characterized this case as a
mixed motive case, and the parties agreed. A mixed motive
case is one in which both legitimate and illegitimate
reasons motivate an employment decision. An employer
can avoid a finding of liability in such a case by proving
that it would have made the same decision even if it had
not allowed sex to play a discriminatory role, and even
though other permissible factors also motivated the
decision. See 42 U.S.C. § 2000e-2(m); see also Desert
Palace, Inc. v. Costa, 539 U.S. 90, 92-95 (2003). To prove
that sex was a motivating factor, a plaintiff must demon-
strate that her sex was one of the reasons that the em-
ployer took adverse action against her.
A plaintiff may establish sex discrimination under Title
VII by either of two means: the “indirect method” or the
“direct method.” See Rogers v. City of Chicago, 320 F.3d
748, 753 (7th Cir. 2003). Under the indirect method, the
burden shifting framework set forth in McDonnell Douglas
Corp. v. Green, 411 U.S. 792, 802-04 (1973), is used. Under
this approach, a plaintiff must first establish a prima
facie case of discrimination by demonstrating that (1) she
is a member of a protected class; (2) her performance
met her employer’s legitimate expectations; (3) despite
this performance, she was subjected to an adverse em-
ployment action; and (4) her employer treated similarly
situated employees outside of the protected class more
favorably. If she succeeds, the burden of production shifts
to the employer to articulate a legitimate, nondiscrimina-
tory reason for its decision, which the plaintiff can then
attack as a pretext for discrimination. See Barricks v. Eli
Lilly and Co., No. 05-3771, 2007 WL 983220, at *2 (7th
Cir. April 4, 2007). The burden of persuasion always
remains with the plaintiff.
10 No. 04-3990
In this case, the defendant did not move for summary
judgment prior to trial. Therefore, the question of whether
the plaintiff could establish a prima facie case was never
tested. During the trial, after the defendant moved for
judgment as a matter of law at the close of the plaintiff ’s
case in chief, the court ruled that this was not an indi-
rect proof case because the plaintiff could not prove that
Cladis, who was not fired, was a similarly situated em-
ployee whose treatment could be compared to hers. Before
taking the motion under advisement, the court told the
plaintiff that, because she was unable to prove her case
under the indirect method, she would have to rely on the
direct proof she had presented.
The parties and the district court were in error, however,
in proceeding as if this is an employee discipline case.
At trial, FCA’s president and owner, Robert Hill, testified
that neither FCA nor the Joliet store had any policy
forbidding employee affairs. Defense counsel asked Hill:
“Are you aware whether any employees have had a
romantic relationship while employed at Floor Covering
Associates of Joliet, Inc.?” To which Hill replied: “Yes, sir,
I am.” He then went on to explain that:
I’m aware that in the Joliet store today of 17 people
over the past number of years there have been 12
employees or more—12 employees that I know of who
have had romantic relationships with other employees.
Transcript at 362. Hill also stated that none of these
employees had been fired or disciplined because of engag-
ing in a romantic relationship.
Throughout the trial, all of the employees of the defen-
dant that were called to testify doggedly maintained that
Hossack had voluntarily resigned. The jury rejected that
explanation in its special verdict. This court agrees with
the jury’s verdict on this question and the defendant has
abandoned this position on appeal. The defendant also
No. 04-3990 11
presented testimony that Hossack was terminated not
only because management feared that her husband
might very well cause workplace disruption, but also
because Cladis was the top salesman and producer at the
Joliet store. The record clearly establishes that the defen-
dant did not discipline either Hossack or Cladis for hav-
ing an affair. Therefore, Hossack was in error when she
attempted to establish that she was similarly situated
to Cladis. She was similarly situated only to other em-
ployees who threatened to cause workplace disruption.
The plaintiff failed to make this comparison and also
failed to identify any other employees similarly situated.
Consequently, she failed to establish a prima facie case of
sex discrimination.
On appeal, the parties continue to argue about the prima
facie case, but it is irrelevant because this court has
ruled that, once a case reaches trial, the McDonnell
Douglas burden shifting framework should no longer be
considered. See Harvey v. Office of Banks and Real Estate,
377 F.3d 698, 708 (7th Cir. 2004). See also Hall v. Gary
Cmty. Sch. Corp., 298 F.3d 672, 675 (7th Cir. 2002) (the
burden shifting framework is “unnecessary when review-
ing judgments as a matter of law”). During and after any
Title VII trial, the sole legal issue is whether the plain-
tiff presented sufficient evidence to permit a rational jury
to determine that she was the victim of intentional
discrimination, see Massey v. Blue Cross-Blue Shield of
Illinois, 226 F.3d 922, 925 (7th Cir. 2000). In addition, the
United States Supreme Court has ruled that once a
defendant comes forward with a nondiscriminatory reason
for its action, the McDonnell Douglas framework “simply
drops out of the picture.” St. Mary’s Honor Ctr. v. Hicks,
509 U.S. 502, 510-11 (1993).
Under the direct method of proving a Title VII case, a
plaintiff may present either direct or circumstantial
evidence of discrimination. See, e.g., Walker v. Glickman,
241 F.3d 884, 888 (7th Cir. 2001). “Direct evidence is
12 No. 04-3990
evidence which if believed by the trier of fact, will prove
the particular fact in question without reliance on infer-
ence or presumption.” Id. It typically “relate[s] to the
motivation of the decisionmaker responsible for the
contested decision,” see Sheehan v. Donlen Corp., 173 F.3d
1039, 1044 (7th Cir. 1999) (citation omitted), and “can be
interpreted as an acknowledgment of discriminatory
intent by the defendant or its agents,” see Troupe v. May
Dept. Stores, 20 F.3d 734, 736 (7th Cir. 1994). Stated
differently, direct evidence “essentially requires an
admission by the decision-maker that his actions were
based on the prohibited animus.” Radue v. Kimberly-Clark
Corp., 219 F.3d 612, 616 (7th Cir. 2000). As such, because
admissions are exceedingly rare in modern employment
discrimination cases, “under the direct method we now
also allow circumstantial evidence to be introduced.”
Hottenroth v. Village of Slinger, 388 F.3d 1015, 1028
(7th Cir. 2004). Circumstantial evidence, unlike direct
evidence, need not directly demonstrate discriminatory
intent, but rather it “allows a jury to infer intentional
discrimination by the decisionmaker” from suspicious
words or actions. See Rogers, 320 F.3d at 753.
We have previously identified three types of circumstan-
tial evidence of particular relevance when establishing the
inference of intentional discrimination in Title VII cases.
The first [and most common] consists of suspicious
timing, ambiguous statements oral or written, behav-
ior toward or comments directed at other employees
in the protected group, and other bits and pieces from
which an inference of discriminatory intent might
be drawn. . . . Second is evidence, whether or not
rigorously statistical, that employees similarly situ-
ated to the plaintiff other than in the characteristic
(pregnancy, sex, race, or whatever) on which an
employer is forbidden to base a difference in treat-
No. 04-3990 13
ment received systematically better treatment. And
third is evidence that the plaintiff was qualified for the
job in question but passed over in favor of (or replaced
by) a person not having the forbidden characteristic
and that the employer’s stated reason for the differ-
ence in treatment is unworthy of belief, a mere pretext
for discrimination.
Troupe, 20 F.3d at 736 (citations omitted). Each type of
circumstantial evidence is sufficient in and of itself to
support a judgment for the plaintiff; however, bits of
circumstantial evidence may also be used to compose a
convincing mosaic of discrimination. See id.Guided by these evidentiary principles, this court must
decide whether the trial court should have vacated the
jury’s verdict and granted judgment in favor of the defen-
dant as a matter of law. See Federal Rule of Civil Proce-
dure 50(b). “Whether judgment as a matter of law is
appropriate in any particular case will depend on a
number of factors. Those include the strength of the
plaintiff ’s prima facie case, the probative value of the
proof that the employer’s explanation is false, and any
other evidence that supports the employer’s case and that
properly may be considered on a motion for judgment as
a matter of law.” See Reeves v. Sanderson Plumbing
Prod., Inc., 530 U.S. 133, 148-49 (2000). The question in
this case is whether the plaintiff has produced sufficient
evidence for a rational jury to conclude that she was
discriminated against and discharged because she is a
woman. The Supreme Court set the parameters for
sufficiency of the evidence in Reeves v. Sanderson Plumb-
ing Prod., Inc., 530 U.S. 133 (2000), an age discrimination
case. In that case, the district court denied two motions
for judgment as a matter of law and entered judgment
in favor of the plaintiff. The Fifth Circuit reversed, hold-
ing that the plaintiff had not introduced enough evidence
to sustain the jury’s finding of unlawful discrimination,
14 No. 04-3990
even though the court did concede that the plaintiff had
produced sufficient evidence that the defendant’s explana-
tion for its employment decision was pretextual. The
Supreme Court reversed and held that the plaintiff did
not have to produce additional independent evidence of
discrimination. The court held that “a plaintiff ’s prima
facie case, combined with sufficient evidence to find that
the employer’s asserted justification is false, may permit
the trier of fact to conclude that the employer unlawfully
discriminated.” Id. at 148.
Under the Reeves standard and considering the totality
of the circumstances, see Harvey v. Office of Banks and
Real Estate, 377 F.3d 698, 707-08 (7th Cir. 2004), Hossack
has not introduced sufficient evidence of intentional
discrimination. The quantum of proof adduced by Hossack
is less than that presented by the plaintiff in Reeves
wherein the plaintiff established both a prima facie case
and pretext. Even though the jury had an adequate
basis to reject the defendant’s contention that Hossack
resigned and find that she was fired, it is uncontroverted
in the record that Hossack was terminated because
management feared her husband’s threats and that he
might very well cause workplace disruption in the future,
while Cladis was not discharged because he was the top
earning salesman at the Joliet store and, thus, was more
important to the organization. We also wish to make
clear that the defendant-appellee had never in its
history terminated an employee for having an illicit
affair, and there is no direct evidence to establish that
the defendant’s alternative explanations (Cladis was the
top salesman at the Joliet store and that management was
afraid of Hossack’s husband) were pretexts unworthy of
belief. See id. at 148 (“an employer would be entitled to
judgment as a matter of law if the record conclusively
revealed some other nondiscriminatory reason for the
employer’s decision”). The best the plaintiff could establish
No. 04-3990 15
in response was to point out that her husband, although
he was distraught (and rightly so) and making threats,
never actually crossed the threshold of the Joliet store
and has never harmed anyone employed there. She could
have done more. Presented with this evidence, no rational
jury could have found for the plaintiff.
Because we agree with the decision of the trial court
judge and are convinced that no reasonable jury could
find that the defendant terminated Hossack’s employ-
ment because she is a woman, the district court’s grant of
judgment as a matter of law in this case IS AFFIRMED.
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—7-6-07