### In the



# United States Court of Appeals

For the Seventh Circuit

____________________

No. 15

‐ 1411

T ERRY D EETS

, Plaintiff

‐ Appellant

,

v.

M ASSMAN C ONSTRUCTION C OMPANY

, et al.

, Defendants

‐ Appellees

.

____________________

Appeal from the United States District Court for the

Southern District of Illinois.

No. 3:13

‐ CV

‐ 883

‐ NJR

‐ PMF

— Nancy J. Rosenstengel

, Judge

.

____________________

A RGUED O CTOBER 6, 2015

— D ECIDED D ATE F EBRUARY 3, 2016

____________________

Before W OOD

, Chief Judge

, and P OSNER and W ILLIAMS

,

Circuit Judges

.

W ILLIAMS

, Circuit Judge

. Terry Deets, a white construction

worker, appeals the grant of summary judgment for his for

‐

mer employers in this suit asserting racial discrimination

under Title VII, 42 U.S.C. § 2000e–2, and 42 U.S.C. § 1981.

Because there is a factual dispute about the basis for Deets’s

layoff, we reverse the district court’s grant of summary

judgment and remand the case for further proceedings.2 No. 15

‐ 1411

I. BACKGROUND

This lawsuit involves Deets’s employment relationship

with Massman, Traylor, Alberici, a joint venture (“MTA”)

formed in 2009 by three construction companies—Massman

Construction Company, Traylor Brothers, Inc., and Alberici

Constructors, Inc.—to bid on a federally assisted project to

build a bridge (the Stan Musial Veteran’s Memorial Bridge)

across the Mississippi River connecting St. Clair County,

Illinois, to St. Louis, Missouri. In December 2009, MTA was

awarded the contract by the Missouri Department of Trans

‐ portation. MTA then entered into a collective bargaining

agreement requiring it to hire operators for the project solely

from two local branches of the International Union of Oper

‐ ating Engineers, Local 512 (for Missouri operators) and Local

520 (for Illinois operators).

A. Terms of Collective Bargaining Agreement

The collective bargaining agreement provided that MTA

would fill an open operator position by either asking the

union for a referral or recalling a former employee it had

hired from the union. (A union member was eligible for re

‐

call for 45 days after he was laid off by MTA.) Under the

terms of the collective bargaining agreement, a worker ac

‐ quired seniority on a machine—meaning that the worker

had a right to continue working on that machine while it

was in service—after he had worked on it for 3 consecutive

days. A worker lost seniority on a machine if it was shut

down for a week or longer. Project Superintendent John

Todt and Project Manager Dale Helmig (both Massman em

‐ ployees) were responsible for all non

‐ administrative staffing

decisions.No. 15

‐ 1411 3

The Missouri Department of Transportation’s contract

with MTA contained federally mandated goals for participa

‐

tion by minorities (14.7%) and women (6.9%) on the project.

Participation MTA was required to make a good faith effort

to meet the participation goals by, among other things,

maintaining a harassment

‐ free work environment, keeping a

file of the names and contact information of minority and

female referrals from the union, and developing on

‐ the

‐ job

training opportunities that expressly included minorities

and women. Because of its agreement with the operators’

union, MTA also had to secure the union’s cooperation “to

increase opportunities for minority groups and women

within the unions, and to effect referrals by such unions of

minority and female employees.” The contract also required

MTA to adopt an equal

‐ employment

‐ opportunity policy and

affirmative

‐ action plan ensuring that employees would be

treated without regard to race in all employment actions, in

‐ cluding hiring, upgrading, demoting, laying off, firing, de

‐ ciding rate of pay, and training. MTA’s affirmative

‐ action

plan also acknowledged its duty to seek the union’s coopera

‐

tion in achieving minority hiring goals.

B. Deets’s Hiring and Layoff

MTA hired Deets, a member of the Illinois operators’

union, on May 9, 2012, after the union had referred him as

an oiler for a Manitowoc 2250 crane. As an oiler, Deets was

responsible for fueling, oiling, and greasing the crane and

ensuring that it operated safely. On May 17, Deets was laid

off because of a lack of work. He was recalled on May 29 to

work on the Manitowoc crane. On June 20, he was reas

‐ signed to work on a Liebherr crane, but by early July it be

‐

came apparent that the Liebherr crane was going to go out of4 No. 15

‐ 1411

service because of insufficient materials. In anticipation of

the shutdown, Todt, the project superintendent, asked Deets

if he was interested in filling in for the Tower crane oiler

who would be going on vacation for two weeks. On July 5,

Deets moved over to the Tower crane. The Liebherr crane

continued to operate on July 5 and 6, and then went out of

service.

On July 17, the day before the Tower crane oiler was set

to return, Deets said that he was approached by Todt, who

told him that he was being laid off at the end of the day.

When Deets asked for a reason, he said that Todt told him

“[m]y minority numbers aren’t right. I’m supposed to have

13.9 percent minorities on this job and I’ve only got 8 per

‐

cent.” Later that day, when he collected his last paycheck,

Deets said that he was told by Jim Rogier, a pier superinten

‐

dent, that he was “sorry to hear about this minority thing.”

Also that same day, Brent McKinnon, a crane operator on

the project, swore in an affidavit that Todt told him that he

“would have to terminate Deets’s 40

‐ hour

‐ minimum work

week because there was an insufficient number of non

‐ white

workers at the Worksite.” Deets acknowledged not being

guaranteed any position on the project but said upon mov

‐ ing over to the Tower crane that Todt assured him that he

could return to his position on the Liebherr crane as soon as

materials for that crane became available—timing that

would coincide with the return of the Tower crane oiler from

vacation. On July 18, however, Todt filled the Liebherr crane

oiler position by hiring Jesse Green, who is a racial minority.

Todt refuted Deets’s recitation of events. Todt admitted

that he and Helmig, the project manager, had decided earlier

(on either July 14 or July 16) to request a minority unionNo. 15

‐ 1411 5

member to fill the oiler position on the Liebherr crane when

it came back into service. But Todt denied telling Deets that

“minority numbers” were the reason for his layoff. Todt ex

‐ plained that he laid off Deets because there was no work: on

July 17 Todt was not sure when the Liebherr crane would go

back into service (and even if he had known, he said, he al

‐ ready had decided not to rehire Deets) and there was no

other work available for Deets. According to Todt, Deets had

no claim to work on the Liebherr crane because it was out of

service for more than a week, so Deets was stripped of

seniority. Todt decided to request a minority oiler to work

on the Liebherr crane, because he had reviewed the labor re

‐

ports for the project and discovered that, for the three weeks

leading up to Deets’s layoff, MTA had been out of

compliance with its minority participation goals for opera

‐

tors. Todt admitted that replacing a white worker with a mi

‐ nority worker so that MTA could meet its minority partici

‐ pation goals would violate the affirmative

‐ action plan and

equal

‐ employment opportunity policy. Todt called Deets

later on the afternoon of July 17 and offered him the oppor

‐ tunity to fill in for other oilers on July 20 and 21.

After he was laid off on July 17, Deets continued to rotate

through a series of short

‐ term assignments, being laid off

and recalled, until he was terminated from the project in De

‐

cember 2012. The result of his July 17 layoff, he says, was a

drastic reduction in his work hours. Deets spent December,

January, and part of February working towards certifica

‐

tions, and in February 2013 he told the union that he was out

of work and wanted to be considered for other projects.6 No. 15

‐ 1411

C. Prior Proceedings

After filing a charge of discrimination with the EEOC

and receiving a right

‐ to

‐ sue letter, Deets filed this lawsuit

alleging that he had been laid off because he is white, in vio

‐

lation of 42 U.S.C. § 2000e

‐ 2 and 42 U.S.C. § 1981. Deets sued

MTA and each of its individual component companies as

‐ serting that he had been laid off “for no other reason than to

create a position for an individual based on their minority

status.” He sought relief in the form of lost wages, back pay,

front pay, lost fringe benefits, compensatory damages, and

punitive damages.

The defendants moved for summary judgment, arguing

primarily that Deets had not offered evidence of intentional

discrimination. Even if Todt had mentioned minority num

‐

bers when he fired Deets, the defendants argued, that refer

‐

ence related to Todt’s decision to request a minority oiler for

the Liebherr crane, not his decision to fire Deets.

The district court granted the defendants’ motion for

summary judgment on both Deets’s Title VII and § 1981

claims and in its opinion, concluded that Deets did not offer

any direct “smoking gun” evidence that Todt fired him be

‐

cause of his race. The court agreed with the defendants that

Todt’s statement to Deets about “minority numbers” was

not direct evidence of discrimination because it was not clear

that the statement referred to Deets’s layoff. Furthermore,

the court determined that Deets’s circumstantial evidence

was unpersuasive. The context of Todt’s and Rogier’s state

‐

ments to Deets demonstrated that the comments were di

‐

rected at the likelihood of Deets’s rehiring on the project, not

his termination.No. 15

‐ 1411 7

In addition, the court rejected Deets’s argument that

Green’s immediate hiring was evidence that MTA’s explana

‐

tion for his layoff—lack of work—was pretextual because

Todt and Helmig decided to hire Green before they termi

‐

nated Deets, leaving no work available for Deets. The court

also concluded that Deets failed to establish a prima facie

case of discrimination under the indirect method of proof.

There were no “fishy circumstances” present: Deets was

hired and fired in accordance with the collective bargaining

agreement, and his employment history with MTA demon

‐

strated that it was common for workers frequently to be laid

off and recalled.

Finally, the court granted the defendants’ motion for

summary judgment on Deets’s § 1981 claim because it al

‐ ready had determined that Deets could not make out a pri

‐

ma facie case of discrimination. Deets had properly identi

‐

fied a contractual right, the court explained, but he provided

no evidence of discrimination with which to survive sum

‐

mary judgment.

II. ANALYSIS

A. Sufficient Evidence to Support Title VII and Section

1981 Claims

On appeal, Deets argues that the district court erred

when it granted the defendants’ motion for summary judg

‐

ment on his Title VII and § 1981 claims. The district court

erred as a matter of law, he maintains, when it concluded

that Todt’s statement was not direct evidence of discrimina

‐

tion. And, Deets continues, the district court also overlooked

a key piece of direct evidence—McKinnon’s affidavit.8 No. 15

‐ 1411

1. Direct Evidence of Discrimination

Deets is correct that the district court erred as a matter of

law when it determined that Todt’s statement was not direct

evidence of discrimination. “Direct evidence is evidence

that, if believed by the trier of fact, would prove discrimina

‐

tory conduct on the part of the employer without reliance on

inference or presumption.” Rhodes v. Ill. Dept. of Transp.

, 359

F.3d 498, 504 (7th Cir. 2004). Deets says that at the time that

he was laid off he asked Todt, “[h]ow can you possibly lay

me off?,” and Todt replied, “[m]y minority numbers aren’t

right. I’m supposed to have 13.9 percent minorities on this

job and I only got 8 percent.” Based on Todt’s statement, it

does not take any inference to conclude that Deets was laid

off because he was not a minority. That race was the factor

that led to Deets’s termination is clear on the face of Todt’s

statement. It is possible that a jury would credit Todt’s denial

that he ever made that statement, but that credibility deter

‐

mination may not be resolved at summary judgment.

See Darchak v. Chi. Bd. of Educ.

, 580 F.3d 622, 632–33 (7th Cir.

2009) (“Employment discrimination cases often center on

parties’ intent and credibility, which must go to a jury unless

no rational factfinder could draw the contrary inference.”

(internal citations and quotation marks omitted).).

We are puzzled by the district court’s conclusion that

Todt’s statement related directly to his decision not to rehire

Deets rather than his decision to terminate Deets. True, in or

‐

der for a statement to be probative of discriminatory intent,

it must be “related to the employment decision in question.”

Robin v. Espo Eng’g Corp.

, 200 F.3d 1081, 1089 (7th Cir. 2000)

(internal quotations marks omitted). But Todt made the

statement at the time he informed Deets he was being laidNo. 15

‐ 1411 9

off, see Oest v. Ill. Dept. of Corr.

, 240 F.3d 605, 611 (7th Cir.

2001) (explaining that a statement’s “temporal proximity” to

the adverse action “is often crucial” when determining

whether statement qualified as direct evidence of discrimi

‐

nation), and directly in response to Deets’s inquiry about the

basis for his termination.

We are similarly puzzled by the defendants’ contention

at oral argument that the motivation behind Deets’s layoff

was immaterial because he was not entitled to work on the

Liebherr crane when it went back into service. The parties do

not dispute that Deets had lost seniority on that machine

when it went out of service. But just because Deets was not

entitled to that position does not permit MTA to lay him off

because of his race. Title VII applies even to at

‐ will employ

‐

ment and does not permit an employer either to fail to hire

or to fire workers based on race. See Green v. Am. Fed’n of

Teachers/Illinois Fed’n of Teachers Local 604

, 740 F.3d 1104, 1105

(7th Cir. 2014); Loucks v. Star City Glass Co.

, 551 F.2d 745,

747–48 (7th Cir. 1977).

The district court also erred when it failed to address

McKinnon’s affidavit. McKinnon swore that Todt told him

on the day that Deets was laid off that an insufficient num

‐

ber of non

‐ white workers was the reason for the termination

of Deets’s “40

‐ hour

‐ minimum work week.” In its final order,

the district court did not discuss McKinnon’s testimony but,

if true, it provides additional direct evidence that Todt laid

off Deets because of his race.

2. Circumstantial Evidence of Discrimination

The district court also erred as a matter of law when it

concluded that there was insufficient circumstantial evi

‐10 No. 15

‐ 1411

dence to permit a reasonable juror to conclude that Deets

was laid off because of his race. Deets assembled sufficient

“scraps of circumstantial evidence” to allow the trier of fact

to conclude that discrimination more likely than not lay be

‐

hind the adverse action. Morgan v. SVT, LLC

, 724 F.3d 990,

996 (7th Cir. 2013). First there are the alleged statements by

Todt (discussed above) and Rogier (telling Deets that he was

“sorry to hear about this minority thing” when Deets went

to pick up his last paycheck). Next, Todt fired Deets know

‐ ing that MTA had been out of compliance with its minority

participation goals for three consecutive weeks. Third, MTA

hired Green, who is a racial minority, to work on the

Liebherr crane the day after terminating Deets. Finally, Deets

offered evidence that Todt’s explanation for his layoff—lack

of work—was pretextual because he likely knew that the

Liebherr crane was going back into service the next day at

the time he fired Deets.

Because Deets’s Title VII claim survives summary judg

‐

ment, his § 1981 claim must also go forward. The parties do

not challenge the district court’s conclusion that Deets has

properly identified a contractual right, and Title VII claims

and § 1981 claims have the same liability standard. See Patton

v. Indianapolis Pub. Sch. Bd.

, 276 F.3d 334, 338 (7th Cir. 2002);

Bratton v. Roadway Package Sys., Inc.

, 77 F.3d 168, 176 (7th Cir.

1996).

B. Mitigation of Damages Determined after Liability

The defendants argue that they are entitled to judgment

as a matter of law on Deets’s wage

‐ based damages claims

because he failed to mitigate his damages by looking for

other work after he was laid off. The defendants frame this

argument as an affirmative defense to Deets’s claim of un

‐No. 15

‐ 1411 11

lawful discrimination. But the proper amount of damages—

including whether Deets mitigated his damages—should be

determined only after he establishes that the defendants un

‐ lawfully discriminated against him. See, e.g.

, Gaffney

v. Riverboat Servs. of Ind., Inc.

, 451 F.3d 424, 460 (7th Cir.

2006); Hutchinson v. Amateur Elec. Supply, Inc.

, 42 F.3d 1037,

1044 (7th Cir. 1994).

C. Joint Venture Does Not Shield Defendants from Li

‐ ability

The defendants also argue that the individual corporate

entities—Massman Construction, Traylor Brothers, and

Alberici Constructors—are entitled to summary judgment

because none of them was Deets’s employer; his employer

was the joint venture. But the defendants have it backwards:

the three individual companies formed a joint venture under

a contract governed by the laws of Missouri. Under Missouri

law, “[t]here is generally no essential difference between a

partnership and a joint venture and they are governed by the

same legal rules,” Binkley v. Palmer

, 10 S.W.3d 166, 169

(Mo. Ct. App. 1999) (internal citations omitted), and “a part

‐ nership is not regarded as a separate legal entity and cannot

sue or be sued,” Sarasohn & Co., Inc. v. Prestige Hotels Corp.

,

945 S.W.2d 13, 16 (Mo. Ct. App. 1997). So Deets may not sue

MTA, a joint venture. The defendants deny that any of the

individual companies is Deets’s employer, but that cannot be

the case. One (or all) of the companies is liable under Title

VII as Deets’s employer, and there is a dispute of fact about

which company or companies that is. See Sklyarsky v. Means

‐

Knaus Partners, LP

, 777 F.3d 892, 895–96 (7th Cir. 2015) (ex

‐ plaining that Title VII plaintiff can have joint employers).

Moreover, the purported lack of an employment relationship12 No. 15

‐ 1411

between Deets and the individual companies likely doesn’t

matter for purposes of Deets’s claim under § 1981 because “a

third party can be liable under § 1981 for interfering with the

plaintiff’s relationship with his employer.” Sklyarsky

, 777

F.3d at 896; see Parker v. Scheck Mechanical Corp.

, 772 F.3d 502,

507 (7th Cir. 2014); Shaikh v. City of Chicago

, 341 F.3d 627,

630–31 (7th Cir. 2003).

III. CONCLUSION

For the foregoing reasons, we R EVERSE the judgment of

the district court and R EMAND the case for further proceed

‐ ings.