13-184-cv John Delaney v. Bank of America Corp., et al.

UNITED STATES COURT OF APPEALS F OR THE S ECOND C IRCUIT

__________ ___________ August Term, 2013 (Argued: January 14, 2014 Decided: September 5, 2014)
Docket No. 13-184-cv

__________ ___________ J OHN D ELANEY , Plaintiff-Appellant ,

- v .- B ANK OF A MERICA C ORPORATION , M ERRILL L YNCH , P IERCE , F ENNER & S MITH , I NC .,  Defendants-Appellees

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_____________ __________ Before: W INTER , W ESLEY and H ALL , Circuit Judges

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_____________ __________ On appeal from a judgment of the United States District Court for the Southern District of New York (Paul A. Engelmayer, J. ), entered on December 11, 2012, granting summary judgment in favor of plaintiff’s form er employer on plaintiff’s claims of age discrimination, under the Age Discrimination in Employment Act of 1967, 29 U.S.C. § 621 et seq. , and breach of contract.
A FFIRMED

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_____________ __________ J ONATHAN H ONIG , Feder Kaszovitz LLP, New York, NY, for PlaintiffAppellant.

 Defendants-Appellees have indicated in th eir brief on appeal that Defendant-Appellee Merrill Lynch, Pierce, Fenner & Smith, Inc. w as improperly pled as Bank of America Merrill Lynch f/k/a Banc of America Securities, LLC . The Clerk of the Court is therefore requested to amend the caption as above.2 P ATRICK J. L AMPARELLO , III (S TEVEN D. H URD , on the brief ), Proskauer Rose LLP, New York, NY, for Defendants-Appellees

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_____________ __________ P ER C URIAM : Plaintiff-Appellant John Delaney (“Plaintiff-Appellant” or “Delaney”) appeals from the December 11, 2012 judgment of the United States Distri ct Court for the Southern District of New York (Paul A. Engelmayer, J. ) granting summary judgment in favor of Appellant’s former employers, Defendants-A ppellees Bank of America Corporation, and Merrill Lynch, Pierce, Fenner & Smith, Inc. 1 (collectively “Defendants-Appellees” or “BoA”), on his claims of age discrimination, under the Age Discrimination in Employment Act of 1967 (“ADEA ”), 29 U.S.C. § 621 et seq. , and breach of contract. For the reasons that follow, we affirm the judgment of the district court.
B ACKGROUND Delaney began working for BoA’s pred ecessors in 1988 and continued to be employed by them through multiple merger s and acquisitions until his termination in September 2010. At all relevant times, Delaney remained an at-will employee. From 1996 to 2006, Delaney worked in the High Yield Sales Group in which he predominantly sold “high yield products.” His compensat ion included a base salary and, where applicable, an annual award of discretionary in centive compensation. In 2005, Delaney was transferred to the Fixed Income Middle Markets Sales Group (“Middle Markets”). Although employees of this group “were expected to sell a wider array

1 See supra n.*.3 of products and cover smaller accounts,” Delaney continued to sell the same high yield products. He also remained in the same physi cal location with other members of the High Yield group. Delaney, however, was assigned to a different reporting line and became eligible for compensation under the Middle Markets Sales Compensation Plan whereby he received an annual salary and quarterly commission on the basis of his pr oduction credits. While working for Middle Markets, his commissi ons exceeded $1.6 m illion in 2009. That same year, Delaney also received a rating of “exceeds/meets” expectations on his annual performance review. In March 2010, Delaney was transferred back to the High Yield gr oup. According to Delaney, this transfer “was a reward for [his ] outstanding work developing middle markets accounts into higher revenue, institutional acco unts.” Appellant Br. 6. Delaney also claims that BoA “agreed that his compensation would not suffer from the transfer because he would be awarded sufficient accounts to ge nerate production credits so that his compensation would remain at least level and, hopefully, increase.” Id. at 7. For BoA, however, this transfer was the result of an inst itutional re-organization aimed at removing all High Yield sales personnel from Middle Markets, wh ich closed in 2012. As a result of this transfer, although Delaney remained in the sa me physical location and continued to manage the same accounts, his compensation reverted to the one associated with High Yield employees, i.e. , a base salary and, if elig ible, a discretionary incentive compensation award. Delaney also received two additi onal accounts upon his transfer. In July 2010, Delaney received a negative mid-year performance review. According to the review, his production ha d decreased by seven percent, while the High Yield group’s4 production as a whole had increase d by twenty percent. The we aknesses cited included that he was a “momentum sales man, [who] could im prove [his] credit skills,” had “difficulty multi-tasking,” “should cover less accounts,” and “need[ed] to focus”. The review also noted a concern as to whether Delaney was able to handle the accounts assigned to him. The following month, as part of a compan y-wide reduction-in-force (“RIF”), High Yield managers were instructed to select un derperforming employees whose dismissal would have the least impact on the business going fo rward. Delaney’s performance continued to
suffer. He was ranked 136 th across all BoA sales personnel for the year in September 2010, and his performance in the High Yield group was the worst of all employees at his level. Delaney, along with 418 other BoA employees, was selected for inclusion in the September 2010 RIF process. BoA terminat ed Delaney’s employment that same month. At the time, Delaney was fifty-six (56) years old, the oldest member of the High Yield group and the only member of that group to be terminated. Following his termination, Delaney brought this employment discrimination action against BoA, alleging claims of age discriminati on in violation of th e ADEA and breach of contract. With respect to the breach of cont ract claim, Delaney alle ges that BoA breached an oral promise made to him “ that his compensation would not su ffer from [his] transfer [to the High Yield group] because he would be awarded sufficient accounts to generate production credits so that his compensation would remain at least level and, hopefully, increase.” Appellant Br. 7. BoA moved fo r summary judgment, which the district court granted after determining that Delaney failed to establish a prima facie age discrimination case. Then assuming arguendo that Delaney had established a prima facie case, the district court5 further ruled that Delaney’s evidence was insuffi cient “to permit a reasonable fact-finder to
conclude that he would not have been terminated but for his age,” and thus that he failed to establish that BoA’s legitimate nondiscrimin atory reason—that Delaney was terminated as part of a RIF and selected based on hi s poor performance—was a pretext for age
discrimination. Delaney v. Bank of Am. Corp. , 908 F. Supp. 2d 498, 513 (S.D.N.Y. 2012). Having dismissed Delaney’s federal claim, the di strict court, pursuant to 28 U.S.C. § 1367, exercised supplemental jurisdiction over his state law claim and determined that none of the
conversations and statements identified on the record constituted an enforceable contract.
Id. at 517-18. Judgment was entered in fa vor of BoA. Delaney timely appealed.
D ISCUSSION On appeal, Delaney argues that in granti ng summary judgment in favor of BoA, the
district court failed to view the evidence in the light most favorable to him as the nonmoving party. Specifically, Dela ney contends that if the dist rict court had properly applied
this Court’s decision in Weiss v. JP Moran Chase & Co. , 332 F. App’x 659, 661 (2d Cir. 2009) (summary order), to the proffered evidence, it would have concluded that BoA’s legitimate nondiscriminatory reason lacked credence and was instead a pret ext for age discrimination. Delaney also challenges the district court’s decision to exercise su pplemental jurisdiction
over his contract law claim and further conten ds that if the district court had properly
considered the submitted evidence , it would have concluded that he had established a breach of contract claim against BoA.
We review de novo a district court’s grant of summary judgment. Allianz Ins. Co. v.
Lerner , 416 F.3d 109, 113 (2d Cir. 2005). In so doing, we “construe the facts in the light6 most favorable to the non-moving party and . . . resolve all ambiguities and draw all reasonable inferences against the movant.” Aulicino v. N.Y.C. De p’t of Homeless Servs. , 580 F.3d 73, 79-80 (2d Cir. 2009) (internal quo tation marks omitted). “A dispute about a ‘genuine issue’ exists . . . wher e the evidence is such that a reas onable jury could decide in the
non-movant’s favor.” Beyer v. Cnty. of Nassau , 524 F.3d 160, 163 (2d Cir. 2008). We uphold a grant of summary judgment “if th e evidence, viewed in the light most favorable to the party against whom it was entered, demonstrates that there are no genuine issues of material fact and that the judgment is warranted as a matter of law.” Global Network Commc’ns, Inc. v. City of New York , 562 F.3d 145, 150 (2d Cir. 2009).
I. We consider first Delaney’s age discrimination claim. It is well established that the burden-shifting framework set forth by the Supreme Court in McDonell Douglas Corp. v. Green , 411 U.S. 792 (1973) ap plies to claims bought under the ADEA. Gorzynski v. JetBlue Airways Corp. , 596 F.3d 93, 106 (2d Cir. 2010). “Under McDonell Douglas , the plaintiff bears the initial burden of establishing a prima fa cie case of discrimination.” Id. Once this burden is met,
the defendant must then “articulate ‘some le gitimate, nondiscriminatory reason’ for its
action.” Id. (internal quotation marks omitted). “T he defendant need not persuade the court that it was actually motivated by the pr offered reason[ ]. It is sufficient if the defendant’s evidence raises a genu ine issue of fact as to whethe r it discriminated against the plaintiff.” Tex. Dep’t of Cmty. Affairs v. Burdine , 450 U.S. 248, 254 (1981) (citation omitted). When the employer meets its burden, “the pl aintiff can no longer re ly on the prima facie case,” Gorzynski , 596 F.3d at 106, but “must prove th at the employer’s proffered reason was7 a pretext for discrimination,” McPherson v. N.Y.C. Dep’t of Educ. , 457 F.3d 211, 215 (2d Cir. 2006). Since the Suprem e Court’s decision in Gross v. FBL Financial Services, Inc. , 557 U.S. 167, 173 (2009), eliminating the mixed-motive analysis as to ADEA claims, “a plaintiff bringing a disparate-treatment claim pursuant to the ADEA” satisfies this burden by presenting facts, which “taken in [his] favor, su ffice to . . . [show that] a triable issue [exists] as to whether [his] age was a ‘but for’ cause of [his] termination.” Gorzynski , 596 F.3d at 106 (quoting Gross , 557 U.S. at 180) (internal quotations omitted).
The district court determined th at Delaney failed to establish a prima facie case of age discrimination, but because this burden is “not onerous,” Burdine , 450 U.S. at 253, we will

assume arguendo that Delaney has met this burden. We agree with the distri ct court that BoA has satisfied its burden to articulate a legi timate, nondiscriminatory reason for Delaney’s termination. We have previous ly held that a RIF constitutes a legitimate, nondiscriminatory reason for termination of employment. See, e.g. , Roge v. NYP Holdings, Inc. , 257 F.3d 164, 168- 69 (2d Cir. 2001); Carlton v. Mystic Transp., Inc. , 202 F.3d 129, 136 (2d Cir. 2000). Here, BoA has explained that Delaney’s employment was te rminated as part of a company-wide RIF to eliminate positions that generate d insufficient value and that co uld be eliminated with little impact to the company’s functioning and furthe r that Delaney was selected for termination based on his poor performance. Specifically, the record evidence shows that two months prior to his termination Delaney received a nega tive mid-year performance review that raised concerns about his productivity level. More over, the evidence indicates that in September 2010, Delaney was ranked 136 th across all BoA sales personnel for the year and his performance in the High Yield group was the worst of all employees at his level.8 We must now decide whether “the evidence, viewed in the light most favorable to the plaintiff, would permit a jury to find . . . . ‘t hat age was the ‘but-for’ cause of the challenged adverse employment action.’” 2 Gorzynski , 596 F.3d at 106 (quoting Gross , 557 U.S. at 180). “The condition that a plaintiff’s age must be the ‘but for’ cause of the adverse employment action is not equivalent to a requi rement that age was the employers only consideration, but rather that the adverse employment action[ ] would not have occurred without it .” Fagan v. U.S. Carpet Installation, Inc. , 770 F. Supp. 2d 490, 496 (E.D.N.Y. 2011) (citing Gross , 557 U.S. at 175-77) (emphasis added). As the district court correctly determined, the evidence on the record establishes that BoA engaged in a RIF in September 2010 and that 418 other

2 In his Reply Brief, Delaney c ontends that the “but-for” causat ion standard is a “trial proof burden [having] . . . no bearing on the burden at issue on summary judgment.” Reply Br. 23. Specifically, Delaney relies relentlessly on a summary order of this Court, Weiss v. JP Morgan Chase & Co. , which states that “[a]n employee may sat isfy the ultimate burden of proving pretext ‘either directly by persuading the co urt that a discriminato ry reason more likely motivated the employer or indirectly by showin g that the employer’s proffered explanation is unworthy of credence,’” to argue that the ev idence taken in a light most favorable to him supports his claim that the RIF was a “su bterfuge” designed to disguise BoA’s discriminatory animus. 332 F. App’x 659, 661 (2d Cir. 2009) (summary order); Reply Br. 21. In the first instance, pursuant to Local Rule 32.1.1., “a summary order is not citable as precedent.” U.S. v. Branch , 538 F.2d 314, 314 n.* (2d Cir. 1976). Second, this particular summary order was issued thirteen (13) days prior to the Supreme Court’s decision in Gross establishing that a “but-for” causation standard applies to ADEA claims, Gross , 557 U.S. at 180. Since Gross has come down, this Court has, as it must, continuously applied a requirement of “but-for” causation in the pretext analysis of the McDonnell Douglas framework in the ADEA context, includ ing at the summary judgment stage. See, e.g. , Taddeo v. L.M. Berry & Co. , 526 F. App’x 121, 122-23 (2d Cir. 2013) (summary order); Timbie v. Eli Lilly & Co. , 429 F. App’x 20, 21-22 (2d Cir. 2011) (summary order); Gorzynski , 596 F.3d at 101, 106; Bolmer v. Oliveira , 594 F.3d 134, 148 (2d Cir. 2010). Additionally, we note that the cases cited in Weiss and relied upon by Delaney do not involve age discrimination under the ADEA, but instead involve an alleged Emplo yee Retirement Income Security Act of 1974 violation and a Title VII gender-b ased discrimination claim. See Burdine , 450 U.S. at 250-51; see also Dister v. Cont’l Grp., Inc. , 859 F.2d 1108, 1109 (2d Cir. 1988). Accordingly, we disregard Delaney’s arguments as to Weiss’ s purported application to the pretext analysis in this case particularly in light of the fact th at it does not state the law of this Circuit.9 employees were included on that month’s RIF list. Although Delaney was the only member of the High Yield group to be terminated an d also the oldest, the evidence supports BoA’s assertion that Delaney was terminated because of his poor performance. In fact, as noted above, in September 2010, Delaney was ranked 136 th among all other BoA sales personnel and had the worst performance of employees in his group at his level. Although Delaney makes much of his 2009 annual performance review in which he received a rating of “exceeds/meets” expectations, the evidence dem onstrates that his performance suffered in 2010 after his return to the High Yield group. While we must ensure that employers do no t act in a discriminatory fashion, we do “not sit as a super-personnel department that r eexamines an entity’s business decisions.”
Scaria v. Rubin , 117 F.3d 652, 655 (2d Ci r. 1997) (citation omitted) . The only age-related evidence that Delaney seeks to introduce is the draft Equal Employment Opportunity Commission (“EEOC”) discrimina tion charge filed by C.G., 3 the second-oldest member of the High Yield group, who was terminated six months after Delaney in March 2011. In the draft EEOC charge, C.G. alleges that he was te rminated on the basis of his age and that colleagues and managers made repeated comments concerning his age. As the district court correctly held, however, this evidence is inadmissible on hearsay grounds. See Fed. R. Evid. 801(c), Fed. R. Civ. P. 56(e). As the district court correctly held, th e draft EEOC charge is inadmissible hearsay—an out-of-court statemen t that Delaney would rely on to show the
truth of the matter asserted. See Fed. R. Evid. 801(c). Material s submitted in support of or in opposition to a motion for summary judgme nt “must be admissible themselves or must

3 We, like the district court, use C.G.’s initials so as to respect his privacy. See Delaney , 908 F. Supp. 2d at 505 n.5.10 contain evidence that will be presen ted in admissible form at trial.” Santos v. Murdock , 243 F.3d 681, 683 (2d Cir. 2001) ( per curiam ); accord Fed. R. Civ. P. 56(c), (e). Even assuming, however, that Delaney could present the ev idence from the EEOC ch arge in admissible form at trial by calling C.G. as a witness, the evidence would no t call into doubt the nondiscriminatory reason BoA has proffered fo r Delaney’s termination. Comments about another employee’s age, removed from any contex t suggesting that they influenced decisions regarding Delaney’s own employment, do not suffi ce to create a genuine issue of fact as to whether age was the but-for caus e of Delaney’s termination. Delaney’s remaining arguments center on his claims that BoA engaged in a “campaign against the oldest Hi gh Yield Sales group members” and a “simultaneous action against the two oldest members of the High Yield” group. Appellant Br. 16, 28 n.10; Reply Br. 1. Delaney, however, does not point to any admissible evidence in support of these claims. “Even in the discrimination context . . . a plaintiff must provide more than conclusory allegations to resist a motion for summary judgment.” Gorzynski , 596 F.3d at 101. Delaney’s allegations do not suffice to create a genuine i ssue of fact as to whether his age was the but-for cause of his termination, i d. at 106; his ADEA claim therefore fails.
II. We turn next to Delaney’s breach of contra ct claim. First, we review the district court’s exercise of supplemental juri sdiction for abuse of discretion. Carlsbad Tech., Inc. v. HIF Bio, Inc. , 556 U.S. 635, 639 (2009). “[I]n any civil action of which the district courts have original jurisdiction, the district cour ts shall have supplemental jurisdiction over all
other claims that are so related to claims in the action . . . that they form part of the same11 case or controversy,” 28 U.S.C. § 1367, i.e. , “derive from a common nucleus of operative fact,” City of Chicago v. Int’l Coll. of Surgeons , 522 U.S. 156, 165 (1997) (internal quotation marks omitted) . “In general, where the federal claims are dismissed before trial, the state claims
should be dismissed as well.” Marcus v. AT&T Corp. , 138 F.3d 46, 57 (2d Cir. 1998). That said, a district court does not abuse its disc retion where the “values of judicial economy, convenience, fairness, and comity” support the exercise. Carnegie-Mellon Univ. v. Cohill , 484 U.S. 343, 350 (1988). In th is case, Delaney’s federal and state claims are based on his employment and termination by BoA, and th ey clearly derive from a common nucleus of operative facts. Moreover, discovery is comp lete, and Delaney’s breach of contract claim does not turn “on novel or unresolved questions of state law.” Cf. Valencia ex rel. Franco v.
Lee , 316 F.3d 299, 306 (2d Cir. 2003) (internal quotation marks omitted). We hold therefore
that the district court did not exceed the bound s of its discretion in exercising supplemental jurisdiction over Delan ey’s non-federal claim. Second, we review Delaney’s allegation in su pport of his breach of contract claim. The district court correctly noted that Delan ey’s various statements created an ambiguity as to the actual nature of the oral promise he asserted was made to him by BoA. Delaney , 908 F. Supp. at 515. On appeal , Delaney contends that the oral promise concerned an agreement “ that his compensation would not suffer from [his] transfer [to the High Yield group] because he would be awarded sufficient accounts to generate production credits so that his compensation would remain at least level and, hopefully, increase.” Appellant Br. 7. Under New York law, a binding contract ca n be formed without the execution of a written agreement. S ee Mun. Consultants & Publishers, Inc. v. Town of Ramapo , 47 N.Y.2d 144,12 148-49 (1979). Nonetheless, and as the dist rict court recognized, the plaintiff must demonstrate that the terms of any agreement are definite. See Charles Hyman, Inc. v. Olsen Indus., Inc. , 227 A.D.2d 270, 275 (N.Y. A pp. Div. 1996) (“[T]he burd en of establishing the
terms of the verbal contract—which falls to the proponent—presents a formidable obstacle to its enforcement. Before a court will impose [a] contractual obligation, it must ascertain
that a contract was made and that its terms are definite.” (citing, in relevant part, Cobble Hill Nursing Home v. Henry & Warren Corp. , 74 N.Y.2d 475, 482 (1989) (o ther citations omitted)). In this case, Delaney’s allegation that BoA pr omised that his compensation would not suffer
lacks the definiteness re quired by New York law. Maffea v. Ippolito , 247 A.D.2d 366, 367 (N.Y. App. Div. 1998) (finding that the terms of an oral agreement to split the proceeds of a lottery win were “not sufficientl y definite to be enforced”); see also Hecht v. Helmsley-Spear, Inc. , 65 A.D.3d 951, 951 (N.Y. App. Di v. 2009) (“The oral assurances lacking any actual terms as to the amount, form, and timing of paymen t of any compensation, and including no methodology or custom providing for the dete rmination of the same, failed to manifest a clear intention on the part of the parties to form a binding, definite severance agreement.”). Our review of the record yields no evidence of the definite nature and terms of the oral promise Delaney asserts was given. Moreover, Delaney’s deposition testimony undermines any allegation that the contract terms were definite: Q. Was there any discussion abou t your compensation if you were to transfer into high yi eld sales, institutional accounts
desk?
A. Not specifically.13 Q. That answer makes me ask, was there a discussion generally?
A. Well, simply that I would move from the commission basis of being paid to the salary/bonus structure. Q. As far as the salary/bonus struct ure, were you told a specific salary that you would be earning?
A. No. But there was no change. Q. There was no change from wh ere you were in middle
markets?
A. Yes. Q. What about the bonus, was th ere any discussion about what bonus you would be paid?
A. Not specifically. Q. There was no guarantee of a bonus, correct?
A. Right. J.A. at 129. Additionally, the record contains no evidence of a conversation concerning the transfer of specific accounts to Delaney as pa rt of his move from Middle Markets to High Yield. Finally, with respect to his bonus compensation, the district court correctly determined that Delaney was an at-will employee and that although annual bonuses were discretionary, there is no record evidence, or ev en an allegation, indicating that Delaney was promised a mid-year bonus. We thus affirm th e dismissal of Delaney’s breach of contract claim for substantially the same re asons as did the district court.14 C ONCLUSION For the foregoing reasons, we AFFIRM the judgment of the district court.