Court Opinion

ID: 6346398
Source: CourtListenerOpinion
Date Created: 2022-06-03 00:00:19.835758+00
Date Added: 2024-06-11T09:17:46.488622
License: Public Domain

Case: 21-10448     Document: 00516341547          Page: 1    Date Filed: 06/02/2022

              United States Court of Appeals
                   for the Fifth Circuit                          United States Court of Appeals
                                                                           Fifth Circuit

                                                                         FILED
                                   No. 21-10448                       June 2, 2022
                                                                    Lyle W. Cayce
                                                                         Clerk
   Larry L. Sears,

                                                            Plaintiff—Appellant,

                                       versus

   Zions Bancorporation NA, formerly known as ZB NA, doing
   business as Amegy Bank of Texas,

                                                            Defendant—Appellee.

                  Appeal from the United States District Court
                      for the Northern District of Texas
                          USDC No. 3:19-CV-2810-C

   Before Richman, Chief Judge, and Clement and Engelhardt,
   Circuit Judges.
   Kurt D. Engelhardt, Circuit Judge:*
          In this case, we must determine whether a 64-year-old banker
   provided sufficient evidence of age discrimination to survive summary
   judgment. We hold that he did. Accordingly, we reverse and remand.

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-10448      Document: 00516341547           Page: 2    Date Filed: 06/02/2022

                                     No. 21-10448

                                          I.
          Larry Sears was hired by Zions Bancorporation (d/b/a/ Amegy Bank
   of Texas, or “Amegy”) on October 1, 2012, as a Senior Vice President
   (“SVP”) in the Dallas bank energy lending department. Sears was hired by
   the group’s manager, Terry McCarter, and Amegy’s Head of Energy, Steve
   Kennedy. Sears initially reported to McCarter, who in turn reported to
   Kennedy. McCarter left the bank in late 2016, after which Sears reported
   directly to Kennedy. Sears’s primary role was business development; his role
   as an SVP was described as the “hunter” of the group.
          In early 2018, Amegy had four SVPs in its Dallas energy lending
   group: Sears (aged 64), John Murray (aged 63), Jill McSorley (aged 54-55),
   and J.B. Askew (aged 31). Askew had been promoted to the role only in
   February 2018.     The Dallas energy lending group also included Vice
   President Matt Lang, an employee in his thirties who had been promoted by
   Kennedy in February 2018, and Assistant Vice President Jack Bush, an
   employee in his thirties that had been promoted by Kennedy in October 2017.
          Amegy concedes that Kennedy was “broadly satisfied” with Sears’s
   performance, though his performance review scores began to falter after
   McCarter left. For example, while Sears’s 2015 and 2016 reviews placed him
   at a 4.5/5 and 4.8/5 rating, respectively, his 2018 score fell to 3.5/5, a “meets
   expectations” review. Amegy states that “Kennedy’s opinion of Sears’
   management and marketing skills had become less favorable in 2017” once
   Kennedy began working directly with Sears.
          According to Amegy, in late 2017 it began to consider hiring a new
   manager for the Dallas energy lending group. A January 2018 email between
   bank executives states that the bank was putting “feelers” out for a new
   manager and “once found, [Amegy] would consider transitioning Larry
   out.” According to the bank, it determined that it needed to eliminate one of

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   the four SVP positions to make room in the budget for such a manager. To
   determine which SVP to eliminate, Kennedy performed an informal ranking.
   Kennedy ranked Sears last and decided to eliminate his position. Amegy
   finalized this decision by April 2, 2018. On April 30, 2018, Kennedy traveled
   to Dallas to tell Sears that he was terminated. In August 2018, Amegy
   suspended its search for an outside candidate and assigned Scott Collins, the
   manager of Amegy’s Houston energy lending department, the role of
   managing the Dallas department.
          Sears sued Amegy alleging that he was terminated because of his age.
   Amegy removed the suit to federal court and later moved for summary
   judgment. The district court granted Amegy’s motion, finding that Sears
   failed to establish a prima facie case of age discrimination and failed to
   demonstrate that Amegy’s proffered reason for Sears’s termination was
   pretextual. Sears timely appealed.
                                         II.
          This court reviews a grant of a motion for summary judgment de novo,
   and applies the same standard as the district court, viewing the evidence in
   the light most favorable to the nonmovant. First Am. Title Ins. Co. v. Cont’l
   Cas. Co., 709 F.3d 1170, 1173 (5th Cir. 2013). Summary judgment is
   appropriate where “there is no genuine dispute as to any material fact and
   the movant is entitled to judgment as a matter of law.” Fed. R. Civ.
   P. 56(a). “Courts do not disfavor summary judgment, but, rather, look upon
   it as an important process through which parties can obtain a ‘just, speedy
   and inexpensive determination of every action.’” Goldring v. United States,
   15 F.4th 639, 644 (5th Cir. 2021) (quoting Celotex Corp. v. Catrett, 477 U.S.
   317, 327 (1986)). “A party asserting that there is no genuine dispute as to any
   material fact must support its assertion by citing to particular parts of
   materials in the record.” Id. at 644–45.

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                                           III.
          Sears claims he was discharged because of his age in violation of the
   Texas Labor Code. Texas law provides that, “An employer commits an
   unlawful      employment       practice        if     because     of . . . age   the
   employer . . . discharges an individual.”           Tex. Lab. Code § 21.051.
   Although Sears brings only a state law claim, the Texas Labor Code is
   designed “to correlate state law with federal law in employment
   discrimination cases,” including the federal Age Discrimination in
   Employment Act. Ysleta Indep. Sch. Dist. v. Monarrez, 177 S.W.3d 915, 917
   (Tex. 2005) (citation omitted); see also Lindsley v. TRT Holdings, Inc., 984
   F.3d 460, 466–67 (5th Cir. 2021). Accordingly, we may turn to federal case
   law for guidance in assessing Sears’s claim.
          As the parties acknowledge, Sears’s employment discrimination claim
   is governed by the burden shifting framework established in McDonnell
   Douglas Corp. v. Green, 411 U.S. 792 (1973). Under McDonnell Douglas, the
   plaintiff has the initial burden to establish a prima facie case of age
   discrimination. Id. at 802. If he does so, the burden shifts to his employer to
   put forth a legitimate, non-discriminatory reason for the adverse employment
   action. Id. at 802–03. If the employer provides such a reason, the burden
   shifts back to the plaintiff to demonstrate that the stated reason is pretextual.
   Id. at 804–05.
          A.        Prima Facie Case
          To establish a prima facie case of age discrimination under Texas law,
   a plaintiff must demonstrate that he “(1) was a member of the protected class
   (that is, 40 years of age or older), (2) was qualified for the position at issue,
   (3) suffered a final, adverse employment action, and (4) was either
   (a) replaced by someone significantly younger, or (b) otherwise treated less
   favorably than others who were similarly situated but outside the protected

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   class.” Tex. Tech Univ. Health Scis. Ctr.-El Paso v. Flores, 612 S.W.3d 299,
   305 (Tex. 2020). Only the fourth prong is disputed here. We have previously
   held that “[o]nly a minimal showing is necessary to meet this burden” of
   establishing a prima facie case. Bauer v. Albemarle Corp., 169 F.3d 962, 967
   (5th Cir. 1999); see also Prestige Ford Co. v. Gilmore, 56 S.W.3d 73, 82 (Tex.
   App.—Houston [14th Dist.] 2001, pet. denied.).
           “Employees are similarly situated if their circumstances are
   comparable in all material respects, including similar standards, supervisors,
   and conduct.” Flores, 612 S.W.3d at 312 (citation omitted). “Though their
   circumstances need not be ‘identical,’ they must be ‘nearly identical.’” Id.
   (citations omitted). “Employees with different responsibilities, supervisors,
   capabilities, work rule violations, or disciplinary records are not considered
   to be ‘nearly identical.’” Id. (citation omitted).
           Here, Sears has produced sufficient evidence to create a dispute of
   material fact regarding whether he was treated less favorably than younger
   and similarly situated SVPs. First, a jury could find that Sears and Askew
   were similarly situated. 1 See County of El Paso v. Aguilar, 600 SW.3d 62, 77
   (Tex. App.—El Paso 2020, no pet.) (noting that whether two employees are
   similar situated is a question of fact for the jury). Both were SVPs, both
   reported and Kennedy, and Sears attested to the fact that Askew performed
   nearly identical job duties based on his resume, which described Askew’s job

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              We acknowledge that two of the other SVPs were over the age of forty. Murray,
   who was near Sears’s age, was involuntarily terminated shortly after Sears. Further,
   although McSorley is over the age of forty, her age difference with Sears can still give rise
   to an inference of age discrimination. This is because the “outside the protected class”
   element does not always have a logical connection to age discrimination when a younger
   (but still protected) employee is favored over an older employee. See O’Connor v. Consol.
   Coin Caters Corp., 517 U.S. 308, 312–13 (1996); see also Mission Consol. Indep. Sch. Dist. v.
   Garcia, 372 S.W.3d 629, 641 (Tex. 2012).

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   as early as February 2018. Although their reviews were not identical, Amegy
   concedes that it was “broadly satisfied” with Sears’s performance.
   Moreover, Askew’s performance records are incomplete, making it difficult
   to compare the SVP’s review. And Sears’s worst review came only after
   certain Amegy executives had discussed “transitioning Larry out.”
          A jury could also find that Sears was treated less favorably. Sears, the
   oldest SVP, was the only SVP selected for termination. Askew not only kept
   his job but was promoted. Indeed, the same day that Sears was fired, Askew
   was promoted to team lead. Kennedy’s talking points for his April 30, 2018
   trip to Dallas include scripts for both firing Sears and promoting Askew with
   a $9,000 raise. Based on this evidence, a jury could reasonably find that Sears
   was treated less favorably than a younger, similarly situated employee.
          Because we find that Sears has produced sufficient evidence that he
   was treated less favorably than others who were similarly situated but outside
   the protected class to avoid summary judgment, we do not reach Sears’s
   argument that he was replaced by Askew.
          B.     Non-Discriminatory Reason
          Because Sears has produced sufficient evidence of a prima facie case
   to survive summary judgment, the burden shifts to Amegy to put forth a
   legitimate, non-discriminatory reason for Sears’s termination. McDonnell
   Douglas, 411 U.S. at 802–03. This is a burden of production, not persuasion.
   Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 142 (2000). The non-
   discriminatory reason that Amegy put forth here is that it chose to eliminate
   Sears because it needed to eliminate an SVP to make room in its budget for a
   new manager to oversee the Dallas energy banking department. Specifically,
   Amegy contends that Kennedy ranked the four SVPs and picked Sears last
   based on his high compensation, his failure to integrate with other
   departments, his past performance reviews, and an internal email that

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   Kennedy viewed as insubordinate. In the abstract, these are all legitimate
   reasons for Sears’s termination.
          C.     Pretext
          Because Amegy has put forth legitimate reasons for Sears’s
   termination, the burden shifts back to Sears to demonstrate that “(1) the
   reason stated by the employer was a pretext for discrimination, or (2) the
   defendant’s reason, while true, was only one reason for its conduct and
   discrimination is another motivating factor.” See Reed v. Neopost USA, Inc.,
   701 F.3d 434, 439–40 (5th Cir. 2012) (quoting Michael v. City of Dallas, 314
   S.W.3d 687, 691 (Tex. App.—Dallas 2010, no pet.)). Under Texas law, a
   plaintiff need only show that age was a “motivating factor” in the employer’s
   decision, not a “but-for” cause of that decision. See id. at 440 (citing
   Quantum Chem. Corp. v. Toennies, 47 S.W.3d 473, 480 (Tex. 2001)).
          A plaintiff must “produce substantial evidence indicating that the
   proffered   legitimate    nondiscriminatory       reason    is   a   pretext   for
   discrimination.” Burton v. Freescale Semiconductor, Inc., 798 F.3d 222, 233
   (5th Cir. 2015) (quoting Laxton v. Gap Inc., 333 F.3d 572, 578 (5th Cir. 2003)).
   “Evidence is substantial if it is of such quality and weight that reasonable and
   fair-minded men in the exercise of impartial judgment might reach different
   conclusions.” Id. (quoting Laxton, 333 F.3d at 579). “A plaintiff may
   establish pretext either through evidence of disparate treatment or by
   showing that the employer’s proffered explanation is false or ‘unworthy of
   credence.’” Laxton, 333 F.3d at 578 (quoting Wallace v. Methodist Hosp. Sys.,
   271 F.3d 212, 220 (5th Cir. 2001)). “At the end of the day, the pretext inquiry
   asks whether there is sufficient evidence ‘demonstrating the falsity of the
   employer’s explanation, taken together with the prima facie case,’ to allow
   the jury to find that discrimination was the . . . cause of the termination.’”
   Goudeau v. Nat’l Oilwell Varco, L.P., 793 F.3d 470, 478 (5th Cir. 2015)

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   (quoting Sandstad v. CB Richard Ellis, Inc., 309 F.3d 893, 897 (5th Cir.
   2002)).
          Sears calls Amegy’s explanation into doubt with a variety of well-
   taken arguments.     First and foremost, Amegy’s actions contradict its
   proffered explanation. Amegy claims to have terminated Sears in order to
   open up room in its budget to hire a manager to oversee the Dallas energy
   banking department. But it never hired that manager. Instead, in August
   2018, just three months after terminating Sears, it “decided for independent
   business reasons to suspend its search for an outside candidate to replace the
   long-since departed McCarter.” That Amegy abandoned its search for a new
   manager—the purported impetus for firing Sears—only three months after
   Sears’s termination undermines the bank’s explanation.
          Additional evidence contradicts Amegy’s proffered explanation that
   the termination decision was made by Kennedy after he conducted an
   informal ranking of the SVPs. Kennedy claimed to have performed his
   informal ranking in “the spring of 2018.” Similarly, Amegy represents in its
   brief that Kennedy considered Sears’s 2018 performance review, which was
   issued on March 1, 2018. But a January 10, 2018 email between Amegy
   executives references “transitioning Larry out.” This suggests that the
   choice to remove Sears was preordained and calls into question the veracity
   of Kennedy’s Spring 2018 ranking of the SVPs.
          Finally, Sears presents evidence that Amegy deviated from its own
   established policies for reviewing and providing feedback to Sears. A 2016
   email from Kennedy describing a “change to [Amegy’s] performance review
   process” states that “[m]anagers are being asked to take time to meet
   individually with employees on their teams to see how they are doing, both
   relative to their goals and with their plans for the rest of the year. This will
   also be a time to reinforce any goals that may need extra attention.” At

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   Kennedy’s deposition he acknowledged that he was required to comply with
   the performance review policy but testified that he was “not sure” if he
   issued Sears a performance appraisal that complied with Amegy’s policies.
   Sears testified that the only feedback that Kennedy ever gave him was in April
   2018, after the decision to fire him had already been made.
          We have repeatedly held that an employer’s failure to follow its
   internal protocols in terminating an employee or in reviewing the employee
   before termination can be evidence of pretext. See Goudeau, 793 F.3d at 477;
   Machinchick v. PB Power, Inc., 398 F.3d 345, 354–55 (5th Cir. 2005), overruled
   on other grounds by Gross v. FBL Fin. Servs., Inc., 577 U.S. 167 (2009); Russell
   v. McKinney Hosp. Venture, 235 F.3d 219, 224 (5th Cir. 2000). The failure to
   follow even non-mandatory policies can give rise to an inference of pretext.
   See Machinchick, 398 F.3d at 354 n.29.          Amegy concedes that Sears’s
   relatively poor ratings (relative to other SVPs) factored into the decision to
   rank him last. The evidence suggests that the ratings were unaccompanied
   by a performance review indicating any improvement may be needed,
   notwithstanding company policy to the contrary. Indeed, evidence suggests
   that only after deciding to terminate Sears did Kennedy comply with this
   policy by giving Sears an oral review telling him that improvement was
   needed. Viewed in the light most favorable to Sears, this evidence shows that
   Kennedy failed to follow the performance review policy that he
   acknowledged he was required to follow.
          Considering all this evidence cumulatively, we are convinced that a
   jury could conclude that age was the reason for Sears’s termination based on
   the evidence Sears has produced to undermine the genuineness of Amegy’s
   explanations. “[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.”
   Reeves, 530 U.S. at 148. This is particularly true under Texas law, where a

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   plaintiff need only establish that age was a “motivating factor” in the
   Amegy’s decision to terminate Sears.         Goudeau, 793 F.3d at 475.
   Accordingly, the district court erred in granting summary judgment in
   Amegy’s favor.
                                     IV.
         Sears has provided sufficient evidence to survive summary judgment
   on his age discrimination claim. Accordingly, we REVERSE the judgment
   of the district court and REMAND for proceedings consistent with this
   opinion.

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