United States Court of Appeals

FOR THE EIGHTH CIRCUIT

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No. 96-3792

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James Moschetti, *

Appellant, *

 v. * District Court for the

Chicago, Central & Pacific *

Railroad Company, *

Appellee. *

*

* Appeal from the United States

* District of Northern Iowa.

*

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Submitted: June 11, 1997

 Filed: July 11, 1997 

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Before MURPHY, HEANEY, and JOHN R. GIBSON, Circuit Judges.

___________

MURPHY, Circuit Judge.

James Moschetti sued his former employer, Chicago, Central & Pacific

Railroad Co. (CCP), for retaliatory dismissal in violation of Title VII,

42 U.S.C. § 2000e et seq. (1997), and the Iowa Human Rights Act, Iowa Code

§ 216, et seq. (1997), for his support of an African American employee.

The district court granted summary judgment to CCP because it accepted the

company's articulated non-discriminatory business reason for his

termination without squarely considering whether it was the real reason

or a pretextual explanation for intentional discrimination. We reverse and

remand.
CCP asked Moschetti to provide a sworn statement as part of its own internal 1

investigation of Forte's claim. Moschetti said in his statement that he believed Forte

was a good employee and that racial discrimination had nothing to do with his

discharge; he also denied ever hearing his supervisor make a racially derogatory

statement. 

In his deposition in this case Moschetti claimed that he had lied in his CCP

statement because he was concerned at the time about keeping his job. He now says

that CCP discriminated against Forte, that Forte's dismissal was based on race, and that

he was terminated because of his support for Forte.

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In December 1992, Moschetti was working as CCP's Chief Mechanical

Officer when he hired Emmitt Forte, an African American, to work under him

as a manager. Subsequently Moschetti complained to his direct supervisors

on numerous occasions about what he perceived to be unfair and racially

motivated treatment of Forte. For example, Moschetti told his supervisors

he did not think they adequately handled incidents near Forte's office

involving a fake bomb and racially derogatory graffiti. Moschetti also

repeatedly sided with Forte when he had disputes with other employees.

When Moschetti demoted a white worker named Jay Claus in May 1993, one

supervisor told him that he could not believe he had demoted Claus while

retaining that "black bastard."

Shortly after this last incident, in June of 1993, Moschetti's

responsibilities were substantially curtailed. CCP states this demotion

was because Moschetti failed to adhere to departmental budgets, traveled

excessively, made decisions which led to labor difficulties, and was not

completely candid about his interest in a job opening with another

employer. Moschetti alleges his demotion was part of the retaliation he

suffered for his support of Forte. 

Forte was dismissed in August of 1993 and later filed a race

discrimination claim against CCP. After Forte was dismissed, Moschetti

1

wrote a positive letter of 
The analysis for both the federal and state claims is the same under Iowa law. 2

See Iowa Code § 216.6 (1997); see e.g., Hulme v. Barrett, 480 N.W.2d 40, 42 (Iowa

1992); Naylor v. Georgia-Pacific Corp., 875 F.Supp. 564 (N.D. Iowa 1995).

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recommendation for him. Moschetti claims that his supervisors expressed

their displeasure to him when they learned of this letter.

In 1990-92 and again in 1994, CCP was responsible for the improper

release of oil from two of its railyards. The clean up costs for CCP were

approximately $35,000. CCP contends that Moschetti was primarily

responsible for monitoring the systems that failed in each spill, that he

did not fulfill this responsibility adequately, and that he failed to

communicate with engineering staff to determine if the systems were

functioning properly. CCP states that Moschetti was not disciplined for

the first spill, but that the second spill (known as the Virden Creek

spill), combined with the earlier problems which had led to his demotion,

resulted in his discharge in October 1994.

Moschetti contends that his discharge was based on his support of

Forte. He disputes whether his department was primarily responsible for

the Virden Creek spill and the extent of his knowledge about the systems

that failed. He also argues that he took appropriate steps to monitor the

oil systems and that other employees had not been terminated after even

more egregious accidents. 

Under Title VII an employer is prohibited from discriminating against

an employee who has "opposed any practice made an unlawful employment

practice" by the statute, or who has "made a charge, testified, assisted,

or participated in any manner in an investigation, proceeding, or hearing"

under the statute. 42 U.S.C. § 2000e-3(a) (1997). The order and

2

allocation of the burden of proof in this type of case is laid out in

McDonnell Douglas Corp v. Green, 411 U.S. 792 (1981). 

At the first stage, the plaintiff bears the initial burden of

establishing a prima 
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facie case of discrimination. The prima facie case, in the absence

of an explanation from the employer, creates a presumption that the

employer unlawfully discriminated against the employee. If the

plaintiff establishes a prima facie case, the burden of production

shifts at the second stage to the defendant, who must articulate some

legitimate, nondiscriminatory reason for the adverse employment

action. If the defendant carries this burden of production, the

presumption raised by the prima facie case is rebutted and drops from

the case. The burden then shifts back at the third and final stage

to the plaintiff, who is given the opportunity to show that the

employer's proffered reason was merely a pretext for discrimination.

The plaintiff retains at all times the ultimate burden of persuading

the trier of fact that the adverse employment action was motivated

by intentional discrimination.

Rothmeier v. Investment Advisers, Inc., 85 F.3d 1328, 1332 (8th Cir. 1996)

(citations omitted); see also, Ryther v. KARE 11, 108 F.3d 832, 836 (8th

Cir.)(en banc), cert. denied, 1997 WL 181004 (1997). The key inquiry is

whether Moschetti has presented evidence sufficient to create a genuine

issue of fact as to whether his employer intentionally discriminated

against him in violation of Title VII. Rothmeier, 85 F.3d at 1337. Our

review of a summary judgment is de novo. Michalski v. Bank of Am. Ariz.,

66 F.3d 993, 995 (8th Cir. 1995).

After the district court concluded Moschetti had presented sufficient

evidence of a prima facie case, it considered whether CCP had articulated

a legitimate, non-discriminatory reason for its decision to fire Moschetti.

The reason given by CCP was that Moschetti had been fired for his

involvement in the Virden Creek oil spill and for other instances of poor

performance. In response the court stated that "courts will not second

guess employer's business decisions when determining whether the reason

given for the termination was a pretext for discrimination," citing Hutson

v. McDonnell Douglas Corp., 63 F.3d 771, 781 (8th Cir. 1995). It declined

to "second guess" the articulated neutral business reason and granted

summary judgment to the employer. 

Hutson should not be read to mean that once an employer has

articulated a 
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legitimate and non-discriminatory reason for its actions, that reason must

be accepted without question. The third stage of the McDonnell Douglas

burden shifting scheme requires consideration of whether the proffered

reason was in fact the real reason the employer acted or if it was really

a pretextual explanation for intentional discrimination. See Gaworski v.

ITT Comm. Fin. Corp., 17 F.3d 1104, 1110 (8th Cir. 1994)(materially

conflicting evidence raises question of fact about the believability, not

the propriety, of the proffered explanation). The district court erred in

not completing the required analysis.

Although the district court recognized that Moschetti had presented

evidence of pretext, it did not complete the analysis required by the third

stage of the McDonnell Douglas burden shifting scheme. Rather, it went on

to say:

The Court will not second guess CCP's business decision to retain or

terminate employees responsible for property damage or environmental

disasters. Whether the Virden Creek spill was as damaging to CCP as

the other incidents and whether Plaintiff's involvement in two spills

is justification for his termination are issues for CCP to determine,

not the Court.

We agree with the district court that the question at this stage is

not whether the employer's explanation was a good or bad business reason.

The reason proffered by CCP was non-discriminatory on its face, satisfying

its burden of production under the second stage of McDonnell Douglas. The

question at this stage is whether Moschetti presented enough evidence to

allow a reasonable fact finder to infer that intentional discrimination,

rather than the proffered explanation, was the real reason for his

termination. Rothmeier, 85 F.3d at 1336-37; see also, Ryther, 108 F.3d at

836-38. The district court did not squarely reach the question of whether

Moschetti has met this burden so it erred in granting summary judgment to

CCP.

The judgment is reversed, and the case is remanded for further

proceedings. 
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A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.