Court Opinion

ID: 808697
Source: CourtListenerOpinion
Date Created: 2012-09-18 14:06:26+00
Date Added: 2024-06-11T18:00:31.528395
License: Public Domain

Case: 11-16043   Date Filed: 09/17/2012   Page: 1 of 13

                                                        [DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS

                     FOR THE ELEVENTH CIRCUIT
                      ________________________

                              No. 11-16043
                          Non-Argument Calendar
                        ________________________

                   D.C. Docket No. 0:10-cv-61348-RSR

ANDREW A. OSTROW,
a.k.a. Andrew Ostrow,

                                                            Plaintiff-Appellant,

                                   versus

GLOBECAST AMERICA INCORPORATED,
A Delaware corporation,

                                                           Defendant-Appellee.

                        ________________________

                Appeal from the United States District Court
                    for the Southern District of Florida
                      ________________________

                            (September 17, 2012)
                Case: 11-16043       Date Filed: 09/17/2012       Page: 2 of 13

Before HULL, MARCUS and MARTIN, Circuit Judges.

PER CURIAM:

       Andrew Ostrow appeals the magistrate judge’s order granting summary

judgment to GlobeCast America, Inc. (“GlobeCast”), his former employer, in his

age discrimination suit filed under the Age Discrimination in Employment Act

(“ADEA”), 29 U.S.C. § 623(a)(1).1 After review, we affirm.2

                               I. BACKGROUND FACTS

A.     Ostrow’s Employment at GlobeCast

       Beginning in 2003, Ostrow worked for GlobeCast as Vice President of

Business and Legal Affairs and General Counsel. Ostrow handled litigation,

supervised outside counsel, offered legal advice and risk management, prepared

corporate documents and sometimes performed other transactional work, such as

negotiating and drafting contracts. Ostrow also supervised one other in-house

       1
        The parties consented to proceeding before a magistrate judge pursuant to 28 U.S.C.
§ 636(c).
       2
          We review the grant of summary judgment de novo, “applying the same legal standards as
the district court.” Chapman v. AI Transport, 229 F.3d 1012, 1023 (11th Cir. 2000) (en banc).
“[S]ummary judgment is appropriate if the evidence before the court shows that there is no genuine
issue as to any material fact.” Id. (quotation marks omitted); see also Fed. R. Civ. P. 56(a). In
making this determination, we view the evidence, and all inferences reasonably drawn therefrom,
in the light most favorable to the nonmoving party. Maniccia v. Brown, 171 F.3d 1364, 1367 (11th
Cir. 1999).

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attorney, who primarily prepared customer contracts. By December 2008,

however, that in-house attorney position was vacant.

      On June 8, 2009, GlobeCast hired 37-year-old Carlo Carroccia to be the

new in-house attorney without consulting Ostrow. Carroccia had experience as a

contracts attorney with telecommunications companies, and his duties at

GlobeCast were to include preparing contracts and assisting the sales department

in New York. Carroccia’s offer letter indicated, however, that there was a

possibility of promotion to the general counsel position depending on his

performance.

      In November 2009, GlobeCast’s new CEO, David Justin, informed Ostrow,

then 60 years old, that his employment contract would not be renewed when it

expired on December 31, 2009. In January 2010, Carroccia was promoted into

Ostrow’s former job.

B.    Magistrate Judge’s Summary Judgment Ruling

      For purposes of summary judgment, GlobeCast conceded that Ostrow

established a prima facie case of age discrimination. Applying the McDonnell

Douglas framework,3 the magistrate judge found that GlobeCast had put forth two

legitimate, non-discriminatory reasons for CEO Justin’s decision not renew

      3
          McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S. Ct. 1817 (1973).

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Ostrow’s employment contract: (1) Justin wanted to restructure the legal

department to save costs due to GlobeCast’s poor financial condition; and (2)

Justin believed that Ostrow’s performance had been deficient. The magistrate

judge concluded that Ostrow presented evidence of pretext as to Ostrow’s

performance, but not as to GlobeCast’s decision to restructure the legal department

for financial reasons. See Chapman v. AI Transport, 229 F.3d 1012, 1037 (11th

Cir. 2000) (en banc) (explaining that the plaintiff must present evidence that each

of the employer’s legitimate, nondiscriminatory reasons is pretextual to avoid

summary judgment). Thus, the district court granted GlobeCast’s motion for

summary judgment as to the ADEA claim.4

                                       II. DISCUSSION

A.     ADEA Principles

       “The ADEA makes it ‘unlawful for an employer . . . to discharge any

individual or otherwise discriminate against any individual . . . because of such

individual’s age.’” Chapman, 229 F.3d at 1024 (quoting 29 U.S.C. § 623(a)(1));

see also 29 U.S.C. § 631(a) (“The prohibitions in this chapter shall be limited to

       4
         Ostrow’s complaint also alleged a breach of contract claim. The district court granted in part
GlobeCast’s motion for summary judgment as to that contract claim. The parties then settled what
remained of the contract claim, and the district court entered final judgment. Ostrow’s contract
claim is not at issue in this appeal.

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individuals who are at least 40 years of age.”). Where, as here, the plaintiff relies

on circumstantial evidence of age discrimination, this Court has applied the

burden-shifting framework articulated in McDonnell Douglas Corp. v. Green, 411

U.S. 792, 93 S. Ct. 1817 (1973). See Chapman, 229 F.3d at 1024 (applying

framework to ADEA claim). Under this framework, if the plaintiff presents a

prima facie case and the employer offers legitimate, non-discriminatory reasons

for the adverse employment action, the burden shifts back to the plaintiff to show

that the stated reasons were mere pretext for unlawful discrimination. Alvarez v.

Royal Atl. Developers, Inc., 610 F.3d 1253, 1264 (11th Cir. 2010).

      The Supreme Court recently clarified that a plaintiff must prove that age

was the “but-for” cause for the adverse employment action in order to prevail on a

disparate treatment claim under the ADEA. Gross v. FBL Fin. Servs., Inc., 557

U.S. 167, 177-78, 129 S. Ct. 2343, 2351 (2009); see also Mora v. Jackson Mem’l

Found., Inc., 597 F.3d 1201, 1204 (11th Cir. 2010) (stating that in Gross the

Supreme Court “ruled out the idea of a ‘mixed motive’ ADEA claim”). In Gross,

the Supreme Court left open the question “whether the evidentiary framework of

[McDonnell Douglas] . . . is appropriate in the ADEA context.” Gross, 557 U.S. at

175 n.2, 129 S. Ct. at 2349 n.2.

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      Accordingly, in light of Gross, we apply the McDonnell Douglas framework

to determine whether Ostrow presented sufficient evidence that age was the “but-

for” cause of GlobeCast’s decision not to renew his employment contract. We do

so because Gross did not explicitly overrule use of the McDonnell Douglas

framework in ADEA cases involving circumstantial evidence and the but-for

causation standard of Gross is consistent with the McDonnell Douglas framework,

in which the burden of persuasion remains with the plaintiff.

      In addition, given that Ostrow’s appeal challenges only the third step of the

magistrate judge’s McDonnell Douglas analysis, we assume arguendo that Ostrow

established a prima facie case of age discrimination and that GlobeCast proffered a

legitimate, nondiscriminatory reason, and address only whether Ostrow presented

evidence from which a jury reasonably could find that GlobeCast’s reason was

pretext for age discrimination.

      A plaintiff may show pretext “either directly by persuading the court that a

discriminatory reason more likely motivated the employer or indirectly by

showing that the employer’s proffered explanation is unworthy of credence.”

Brooks v. Cnty. Comm’n of Jefferson Cnty., 446 F.3d 1160, 1163 (11th Cir. 2006)

(quotation marks omitted). The plaintiff must demonstrate “‘such weaknesses,

implausibilities, inconsistencies, incoherencies, or contradictions in the

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employer’s proffered legitimate reasons for its action that a reasonable factfinder

could find them unworthy of credence.’” Alvarez, 610 F.3d at 1265 (quoting

Combs v. Plantation Patterns, 106 F.3d 1519, 1538 (11th Cir. 1997)). A reason

cannot be “pretext for discrimination unless it is shown both that the reason was

false, and that discrimination was the real reason.” St. Mary’s Honor Ctr. v.

Hicks, 509 U.S. 502, 515, 113 S. Ct. 2742, 2752 (1993) (quotation marks

omitted); see also Brooks, 446 F.3d at 1163.

      The plaintiff cannot “recast an employer’s proffered nondiscriminatory

reasons or substitute his business judgment for that of the employer,” but instead

must “meet that reason head on and rebut it, and the employee cannot succeed by

simply quarreling with the wisdom of that reason.” Chapman, 229 F.3d at 1030.

Indeed, in deciding whether the plaintiff has shown pretext, we do not sit as a

“super personnel department,” and must take care not to second-guess the

employer’s business judgment. See id. For this reason,“[t]he inquiry into pretext

centers on the employer’s beliefs, not the employee’s beliefs, and . . . not on reality

as it exists outside of the decision maker’s head.” Alvarez, 610 F.3d at 1266

(explaining that the question is not whether the employee actually had

performance problems, but “whether her employers were dissatisfied with her for

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these or other non-discriminatory reasons, even if mistakenly or unfairly so, or

instead merely used those complaints . . . as cover for” discrimination).

B.    Ostrow’s ADEA Claim

      Ostrow did not present evidence from which a jury could conclude that

GlobeCast’s reason for not renewing his contract—restructuring its legal

department to save costs—was pretext for age discrimination. Ostrow did not

dispute that GlobeCast was struggling financially. GlobeCast had not been

profitable for years and operated only because of shareholder support. In recent

years, GlobeCast had reduced its workforce by half and consolidated offices to

reduce costs. Yet, in 2008, GlobeCast’s net income was negative $15 million.

      GlobeCast’s parent company, GlobeCast Worldwide, tasked new CEO

Justin with returning GlobeCast to profitability. Justin had previously worked at

GlobeCast France and GlobeCast Europe and had most recently been the CEO of

GlobeCast Asia. To fulfill his mission at GlobeCast America, Justin, among other

things, redistributed responsibilities among GlobeCast’s employees and let ten

employees go, including Ostrow. Justin explained that he believed GlobeCast’s

legal department was overstaffed because other GlobeCast corporations did not

have two attorneys in their legal departments. GlobeCast also had more active

litigation cases than Justin had seen at other GlobeCast corporations. Meanwhile,

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Ostrow was GlobeCast’s second-highest paid employee. Based on GlobeCast’s

poor results in litigation matters and a need to assist in business generation to

improve the bottom line, Justin decided to shift the legal department’s focus to

transactional work by reducing staff to one in-house transactional attorney and

hiring outside counsel to handle litigation. Justin stated that he “expected

[GlobeCast] to realize significant positive results on the open litigation matters

and realize cost savings as a result of this decision.”

      Ostrow argues that GlobeCast’s financial reason did not make sense because

GlobeCast had been losing money since 2000 and yet had renewed his two-year

contract twice before. Ostrow’s argument ignores the undisputed facts that by

June 2009 GlobeCast Worldwide wanted “major changes,” and tasked Justin as

the new CEO with turning GlobeCast’s fortunes around.

      Ostrow also contends that restructuring the legal department in fact cost

GlobeCast money. This argument merely quarrels with the wisdom of Justin’s

restructuring decision. The inquiry is whether Justin believed in good faith (even

mistakenly) that his restructuring plan would save money, not whether it in fact

did so. See Alvarez, 610 F.3d at 1266. Ostrow presented no evidence that casts

doubt on Justin’s stated good faith belief. By restructuring the legal department,

GlobeCast would go from paying Ostrow’s $219,000 salary and Carroccia’s

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$155,000 salary, to paying only Carroccia’s new $178,500 salary, a savings of

$195,500.5

       Ostrow points to Justin’s deposition testimony admitting that he did not

know how much money was spent on outside counsel after Ostrow’s departure and

that the amount spent was not significant to the bottom line. These statements,

which are taken out of context, do not show pretext. In context, Justin testified

that GlobeCast’s most significant litigation cost was the Intelsat case, which had

been handled by outside counsel even before Ostrow left, that the cost of outside

counsel for the remaining, smaller cases, while not negligible, was not significant

to the bottom line, but that the real cost of those smaller cases was the risk of

being countersued. If anything, this testimony supports Justin’s explanation that

he wanted to shift the legal department’s focus away from litigation and toward

business generation.

       5
         Although whether, in fact, Justin’s restructuring plan saved GlobeCast money is not the
relevant inquiry, the district court noted that the undisputed facts suggest that Justin’s restructuring
plan did, in fact, result in a net savings during Carroccia’s first 18 months as General Counsel, as
follows:
        Between January 1, 2010, and June 2011, GlobeCast expended approximately
        $100,000 to $125,000 on outside counsel for litigation-related services of the type
        that Ostrow had previously provided. Thus, the changes to the structure of
        GlobeCast’s legal deparment resulted in a net savings to GlobeCast from January 1,
        2010, through June 2011 of, at the very least, $169,250 (1½ times Ostrow’s annual
        salary of $219,000 ($328,500), minus the total of $125,000 in outside litigation costs
        and 1½ times the increase in Carroccia’s salary beginning January 1, 2010
        ($159,250), equals $169,250).
(Citation omitted).

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      Ostrow also failed to show the kind of pattern of older employees being

replaced by younger employees that can be circumstantial evidence of a

decisionmaker’s discriminatory intent. In Damon v. Fleming Supermarkets of

Fla., Inc., a supermarket chain’s district manager terminated or demoted four of

seven store managers within a one-year period. All four store managers were over

40 and were replaced by employees who were under 40. 196 F.3d 1354, 1361

(11th Cir. 1999). This Court concluded that a “pattern of firing or demoting so

many older workers and replacing them with younger workers, by the relevant

decision-maker during the same time period, constitutes probative circumstantial

evidence of age discrimination.” Id.

      Here, Ostrow has not shown that Justin engaged in such a pattern.

Beginning in June 2009, Justin (who was himself 43) let go nine other GlobeCast

employees (besides Ostrow), none of whom were replaced by new hires. Two of

these nine employees, former Vice President of Human Resources, Cathleen

Togut, and former Vice President of Engineering and Operations, David Szelag,

were in their 50s. The duties of Togut were assumed by her supervisor, Anne

Phillipe, GlobeCast’s Chief Financial Officer, who was in her 30s. The duties of

Szelag were divided between two employees, Gus Pu, in his mid-50s, and Brad

Smith, in his late 40s. Mary Salih, a third employee in her late 40s, was also let

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go, but there is no evidence as to who replaced her or assumed her duties. Thus,

the record establishes that only two employees Justin let go during his

restructuring—Togut and Ostrow—had their duties assumed by someone under

40. Moreover, the assumption of Togut and Szelag’s duties by GlobeCast’s

remaining employees was consistent with Justin’s stated desire to reduce staff to

cut costs. And, unlike in Damon, there was no evidence that Justin ever made any

comments regarding age during this time frame. Cf. id. at 1358-59 (stating that

the decisionmaker wanted “aggressive, young men” to be promoted).

      Ostrow points to other former GlobeCast employees who left GlobeCast

between 2006 and 2008, but these employees were terminated by GlobeCast

Worldwide’s Chairman and CEO, Christian Pinion, not by Justin during his

restructuring. Given that Ostrow did not show evidence of one decisionmaker in

one time period replacing many older workers with younger workers, we cannot

say he showed the kind of a firing and hiring pattern found in Damon that is

probative circumstantial evidence of age discrimination.

      Based on the above, Ostrow has not shown that GlobeCast’s proffered

financial reason for not renewing his contract was pretext for age discrimination

and has not shown that his age was the “but-for” cause of the decision not to

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renew his contract. For these reasons, we affirm the magistrate judge’s order

granting summary judgment to GlobeCast.

      AFFIRMED.

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