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holding a "Notice of Proposed Removal" was appealable and therefore not final, especially because the removal was proposed "on its face"
Summary of this case from Risos-Camposano v. Nev. Sys. of Higher Educ.Opinion
No. C 05-2299 SBA.
November 28, 2006
ORDER [Docket Nos. 47, 51]
This case comes before the Court on Defendant John Potter's Motion for Summary Judgment. For the reasons stated below, the Court GRANTS Defendant's motion.
BACKGROUND
Plaintiff David Gannon, a white male, is a window clerk at a post office in Elk Grove, California. First Amended Complaint (FAC) at ¶ 3. Before November, 1995, Gannon was a Manager of Distribution and Operations at the Postal Service's West Sacramento Processing and Distribution Center. Id. at ¶¶ 20-22. How Gannon became a window clerk after being a supervisor is the subject of this lawsuit.
While Gannon was a manager, he supervised an employee named Ray Bastian. FAC at ¶ 9. On October 16, 1995, Gannon placed Bastian on restricted sick leave, meaning that Bastian could no longer take sick leave without a doctor's note. Martikan Decl., Exhibit A at 58-59 and Exhibit F. Two days later, on October 18, 1995, Gannon took Bastian off of restricted sick leave after a conversation in which Gannon told Bastian that he was taking Bastian off of restricted sick leave and then immediately asked Bastian to drive a mentally disabled employee named Joe Enos to work. Id. at 82; Exhibit G. Bastian understood Gannon's statement as proposing a quid pro quo: Gannon would take Bastian off of restricted sick leave if Bastian would drive Enos to work. Id., Exhibit K at 17. Bastian felt that he was placed in a compromising situation. Id. A white male postal employee named Bill Dolan complained to management that Gannon had taken Bastian off of restricted sick leave as a quid pro quo for Bastian's agreement to drive Joe Enos to work. Id., Exhibit A at 72-73.
Dolan's complaint about Gannon was first investigated by James Taylor, who was in Human Resources at the time. Id. at 14; Exhibit C at 1. Taylor is also a white male. Id., Exhibit B at 2. Taylor prepared a memorandum for Bob Williamson, who was the West Sacramento plant manager at the time, summarizing his investigation. Id., Exhibit A at 71 and Exhibit H. In the memo, Taylor noted that Gannon admitted that he had told Bastian that he would take Bastian off of restricted sick leave if Bastian would drive Enos to work, but that Gannon said that he was just "joking." Id. at Exhibit H. Taylor concluded that Gannons' behavior was "clearly beyond the bounds of acceptable management practices" and unethical. Id. at Exhibit H.
Williamson reviewed Taylor's memo and concluded that Taylor's investigation supported the charge that Gannon had misused his authority by trading corrective action against a subordinate in exchange for personal services. Martikan Decl., Exhibit D at 1. Williamson also found that Gannon had falsified employee Joe Enos' time card. Id. Williamson forwarded Taylor's memo to Frank Jackson, an African-American man who was Gannon's supervisor at the time, for review and appropriate action. Id. at 1-2. Jackson issued Gannon a Notice of Proposed Removal in November, 1995. Id. at 2. On November 30, 1995, Gannon and his representative at the time — John Garrard — met with Williamson and Taylor to discuss the Notice of Proposed Removal. Martikan Decl., Exhibit A at 25; Exhibit D at 2. Marilyn Walton, who was the State Board President of the National Association of Postal Supervisors, also attended the meeting. Martikan Decl., Exhibit E at 10-11. Jackson was not at the meeting. Id., Exhibit A at 27.
During the meeting, Taylor offered Gannon the opportunity to return to a "craft" position at the post office of his choice, meaning that Gannon would lose his supervisory position and become a window clerk, to avoid removal. Id. at 29-30. Gannon left the room to discuss the offer with Garrard and Walton. Id. at 30. When they returned, Gannon accepted the offer. Id. at 31. Gannon signed and dated a routing slip stating the following:
I hereby request voluntarily to return to craft. I desire an assignment in the South Area with a guarantee of 40 hours per week.Id. at 92 and Exhibit I. Gannon returned to work as a window clerk on December 21, 1995. Id. at 96. While the Postal Service was investigating Gannon's misconduct, he was placed on administrative leave with full supervisor's pay. Id. at 94.
Gannon challenged his demotion before the Merit Systems Protection Board (MSPB). FAC at ¶ 5. After a hearing on the merits, the MSPB rejected Gannon's claim. Id. Gannon appealed to the full Board of the MSPB, which also rejected his claim. Id. Gannon's First Amended Complaint did not challenge the MSPB's ruling on his non-discrimination claim; it only included a Title VII race discrimination claim. However, during the hearing on the instant summary judgment motion, and in a supplemental brief filed thereafter, Gannon claimed that he was appealing the MSPB's ruling on both his discrimination and non-discrimination claims. See Plaintiff's Supplemental Brief at 4-5.
Gannon initially included a retaliation claim in his complaint, but this Court dismissed that claim in a December 14, 2005 Order.
LEGAL STANDARD
A. Summary Judgment
Under Federal Rule of Civil Procedure 56, a court may properly grant a motion for summary judgment if the pleadings and materials demonstrate that there is "no genuine issue as to any material fact and the moving party is entitled to judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). A dispute about a material fact is genuine "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Summary judgment may be granted in favor of a defendant on an ultimate issue of fact where the defendant carries its burden of "pointing out to the district court that there is an absence of evidence to support the nonmoving party's case." Celotex, 477 U.S. at 325; see Johnston v. IVAC Corp., 885 F.2d 1574, 1577 (Fed. Cir. 1989).
To withstand a motion for summary judgment, the non-movant must show that there are genuine factual issues which can only be resolved by the trier of fact. Anderson, 477 U.S. at 250. The nonmoving party may not rely on the pleadings but must present specific facts creating a genuine issue of material fact. T.W. Elec. Serv. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). The court's function, however, is not to make credibility determinations. Anderson, 477 U.S. at 249. The inferences to be drawn from the facts must be viewed in a light most favorable to the party opposing the motion. T.W. Elec. Serv., 809 F.2d at 631.
"In evaluating motions for summary judgment in the context of employment discrimination, we have emphasized the importance of zealously guarding an employee's right to a full trial, since discrimination claims are frequently difficult to prove without a full airing of the evidence and an opportunity to evaluate the credibility of the witnesses." McGinest v. GTE Serv. Corp., 360 F.3d 1103, 1112 (9th Cir. 2004).
B. Title VII
The sole remaining issue in this lawsuit is whether Gannon was discriminated against on the basis of race, in violation of Title VII. Title VII makes it illegal for an employer "to fail or refuse to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions or privileges of employment because of such individual's race, color, religion, sex or national origin[.]" 42 U.S.C. § 2000e-2(a)(1).
"Under Title VII, an individual suffers disparate treatment when he or she is singled out and treated less favorably than others similarly situated on account of race." McGinest v. GTE Service Corp., 360 F.3d 1103, 1121 (9th Cir. 2004). "The plaintiff in a disparate treatment case must show the employer's intent to discriminate, but intent may be inferred from circumstantial evidence." Id. at 1122.
The plaintiff has the burden of establishing a prima facie case of discrimination. If that is accomplished, "then the burden shifts to the defendant to articulate a legitimate, nondiscriminatory reason for its allegedly discriminatory conduct. If the defendant provides such a reason, the burden shifts back to the plaintiff to show that the employer's reason is a pretext for discrimination." Vasquez v. County of Los Angeles, 349 F.3d 634, 640 (9th Cir. 2003).
To establish a prima facie case, the plaintiff "must offer evidence that `gives rise to an inference of unlawful discrimination,'" either through the framework set forth in McDonnell Douglas Corp. v. Green, 411 U.S. 792 (1981), or with direct or circumstantial evidence of discriminatory intent. Id. (quoting Texas Dept. of Community Affairs v. Burdine, 450 U.S. 248, 253 (1981)). Under the McDonnell Douglas framework, unlawful discrimination is presumed if the plaintiff can show that: (1) he belongs to a protected class; (2) he was performing according to his employer's legitimate expectations; (3) he suffered an adverse employment action; and (4) other employees with qualifications similar to his own were treated more favorably. Once the defendant produces evidence of a legitimate non-discriminatory reason for its actions, the McDonnell Douglas "presumption of discrimination drops out of the picture." McGinest, 360 F.3d at 1123 ( quoting Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 143 (2000)).
The Court confirmed at the hearing on this Motion for Summary Judgment that Plaintiff is pursuing his claim under the McDonnell Douglas framework. Both parties conceded that the primary issue in this case is whether Defendant suffered an adverse employment action.
DISCUSSION
Defendant's first argument in support of his Motion for Summary Judgment is that Plaintiff cannot make out a prima facie case of race discrimination because he never suffered an adverse employment action. Defendant argues that Gannon voluntarily took a demotion to a lower paid position in exchange for the Post Office's decision not to pursue the Removal Action against him. As the demotion was voluntary, the demotion cannot constitute an "adverse employment action" for the purpose of establishing a prima facie showing of discrimination under the third prong of the McDonnell Douglas test. Plaintiff responds that he suffered an adverse employment action in the form of: (1) a removal; (2) a suspension; (3) a reduction in grade; and (4) a reduction in pay. The facts demonstrate that Plaintiff in fact received a Notice of Proposed Removal, a Paid Administrative Leave during the pendency of an investigation, and a Demotion.
A. The Notice of Proposed Removal.
Defendant correctly argues that the Notice of Proposed Removal was only an intermediate step in the removal process and therefore did not constitute an "adverse employment action." Several district courts have held that a Notice of Proposed Removal is not an adverse employment action for purposes of a Title VII claim, because it is not sufficiently final, and because it is subject to modification by an employer following an appeal. In Niimi-Montalbo v. White, 243 F.Supp.2d 1109, 1128 (D. Haw. 2003), the district court held that under Ninth Circuit law, a Notice of Proposed Removal issued to an employee by the Army Corps of Engineers was not an adverse employment action because the employee's right to appeal the Notice made it insufficiently final. Id. The district court discussed the Ninth Circuit's decision in Brooks v. City of San Mateo, 229 F.3d 917, 930 (9th Cir. 2000), in which the Ninth Circuit held that an employment decision that could be changed on appeal was not sufficiently final to constitute an adverse employment action. Id. ("Because the [negative performance] evaluation could well have been changed on appeal, it was not sufficiently final to constitute an adverse employment action.").
The Notice of Proposed Removal that Gannon received in this case, like the Notice of Proposed Removal in Niimi-Montalbo and the job evaluation in Brooks, was subject to appeal. Martikan Decl., Exhibit J at 2. The Notice says so on its face. Id. Indeed, Gannon did appeal the Notice of Proposed Removal to the plant manager, Bob Williamson. Id., Exhibit L. The facts in this case are also similar to those addressed by the Ninth Circuit in Brooks. The plaintiff in Brooks received a negative job evaluation, appealed the evaluation, and then abandoned her job while the appeal was pending. Id. Here, Gannon received a Notice of Proposed Removal, appealed it to the plant manager, and then accepted a demotion while the appeal was pending.
Other district courts have held that a Notice of Proposed Removal is not an adverse employment action. In Hardy v. Potter, 191 F.Supp.2d 873, 883 (E.D. Mich. 2002), a district court held that a Postal Service Notice of Proposed Removal was not an adverse employment action because it "was essentially a warning letter to Plaintiff." Id. And in Boykin v. England, 2003 WL 21788953, *5 (D.D.C. 2003), the district court held that a Notice of Proposed Removal was not an adverse employment action because it "was essentially a precursor to the . . . Decision to Remove." Thus, the Notice of Proposed Removal was an "interlocutory or mediate decision" that had no effect on the employment conditions. Id. (quoting Page v. Bolger, 645 F.2d 227, 233 (4th Cir. 1981) ( en banc)).
B. Paid Administrative Leave.
During the investigation into his misconduct, Gannon was placed on paid administrative leave. Martikan Decl., Exhibit A at 94. Defendant argues that placing Gannon on paid administrative leave during the course of the investigation does not constitute an adverse employment action. Gannon did not challenge this argument in his Opposition.
Persuasive authority supports Defendant's argument. A district court in this District has held that being placed on paid administrative leave is not an adverse employment action, because it does not deprive a plaintiff of any term, condition or benefit of employment. Tomczak v. Safeway, Inc., 1997 WL 564049, *5 (N.D. Cal. 1997). Also, the Second Circuit held that placing an employee on paid administrative leave during an investigation is not an adverse employment action. Joseph v. Leavitt, 465 F.3d 87, 91 (2d Cir. 2006) ("We therefore hold that Joseph's placement on administrative leave pending the criminal charges against him did not constitute an adverse employment action.").
As the Second Circuit noted, four other Circuits have reached this result: the Eighth, Sixth, Fifth, and Fourth Circuits. Id. (collecting cases). The Federal Circuit is also in accord. Haddon v. Executive Residence at the White House, 313 F.3d 1352, 1363 (Fed. Cir. 2002). Accordingly, the Court holds that Gannon suffered no adverse employment action when he was placed on paid administrative leave.
C. Gannon Voluntarily Requested A Demotion Rather Than Face Removal.
Next, Defendant argues that Gannon's demotion, resulting in the reduction in both pay and grade, was voluntary. Plaintiff responds that whether Gannon's decision to accept the demotion was voluntary is disputed, but does not provide a factual or legal basis to support this assertion.
The Court finds that Gannon's demotion from supervisor to window clerk does not constitute an adverse employment action because he requested the demotion voluntarily in exchange for the Postal Service's rescission of the Notice of Proposed Removal. Gannon has testified that after receiving the Notice of Proposed Removal, he and his representatives met with Bob Williamson, the plant manager, and James Taylor, from Human Resources, to contest the Notice. Martikan Decl., Exhibit A at 25. During that meeting, Taylor offered to rescind the Notice of Proposed Removal if Gannon would accept a demotion to window clerk at the post office of his choice. Gannon discussed the offer with his representatives in another room, and decided to accept the offer. As evidence of his acceptance, Gannon signed and dated a document stating the following:
I hereby request voluntarily to return to craft. I desire an assignment in the South Area with a guarantee of 40 hours per week.Id. at 92 and Exhibit I. Gannon's own representative, John Garrard, testified that Gannon never told him that he felt coerced into signing this document. Martikan Decl., Exhibit M.
D. The MSPB Correctly Found That Gannon's Demotion Was Voluntary.
During the hearing on the instant motion, Gannon informed the Court that he intended to petition for review of the MSPB's decision on the voluntariness of his demotion, under 5 U.S.C. § 7703(b)(2), as well as the MSPB's decision on his race discrimination claim. This position is contrary to Gannon's First Amended Complaint, which does not seek review of the MSPB's decision on Gannon's non-discrimination claim.
Gannon brought a "mixed case" before the MSPB, meaning that he raised both a discrimination claim under Title VII, and a non-discrimination claim under the Civil Service Reform Act (CSRA). FAC at ¶ 7. In the context of his non-discrimination claim under the CSRA, Gannon fully litigated the issue of whether his demotion to a craft position was voluntary before the MSPB. AR000312. The full administrative record of the MSPB proceedings, and the final decision, have been filed with this Court.
1. Nature of the MSPB's Jurisdiction.
The MSPB is charged with overseeing and protecting the merit system, and adjudicating conflicts between Federal employees and employers. Sloan v. West, 140 F.3d 1255, 1259 (9th Cir. 1998). The MSPB is authorized to review "adverse employment actions," such as removals, suspensions exceeding 14 days, reductions in grade, reductions in pay, or furloughs for fewer than 30 days. 5 U.S.C. § 7512(1)-(5).
The MSPB also has jurisdiction over Title VII discrimination claims if they are brought in conjunction with non-discrimination adverse employment action claims. Sloan, 140 F.3d at 1259. Cases brought before the MSPB that assert both discrimination and non-discrimination claims are called "mixed cases," and if the MSPB determines that it has jurisdiction over them, they are called "mixed case appeals." Id. If the MSPB decides a mixed case appeal against the employee, then the employee may challenge both the discrimination and non-discrimination aspects of the MSPB's opinion in federal district court. 29 C.F.R. § 1614.310(b).
Although the district court has jurisdiction to review both the employee's discrimination and non-discrimination claims, the scope of the district court's review varies based on the type of claim before it. The district court reviews the discrimination claim de novo, without any regard to the MSPB's decision. However, the district court reviews the non-discrimination claim as an appeal of the MSPB's administrative decision, meaning that the district court defers to the MSPB's factual findings and reviews for abuse of discretion. Romain v. Shear, 799 F.2d 1416, 1421 (9th Cir. 1986).
2. Standard of Review for the MSPB's Decision on a Non-Discrimination Claim.
The Ninth Circuit has held that an MSPB decision on a non-discrimination adverse employment action claim is not subject to de novo review. Romain, 799 F.2d at 1421. Rather, in a mixed case, the Court reviews the MSPB's decision on the Army's personnel action under a "more deferential statutory standard" than the discrimination claim. Washington v. Garrett, 10 F.3d 1421, 1428 (9th Cir. 1994). The Court will uphold the MSPB's decision unless it was arbitrary and capricious, an abuse of discretion, or unsupported by substantial evidence. Id.
Thus, the MSPB's decision that Gannon failed to state a prima facie case that he was subject to an adverse employment action because he could not show that his demotion was not voluntary is subject to review for abuse of discretion. And Gannon has not shown that the MSPB's factual findings, including its finding that Gannon's testimony was not credible, were arbitrary and capricious. Notably, the Ninth Circuit has held that an MSPB judge's determination of a witness's credibility is entitled to considerable deference. Washington, 10 F.3d at 1430.
3. The MSPB Did Not Abuse Its Discretion.
Gannon has failed to show how the MSPB abused its discretion in deciding that Gannon's demotion was voluntary. The MSPB administrative judge heard testimony, reviewed documentary evidence, and assessed the credibility of witnesses. The administrative record shows that Gannon had a full and fair opportunity to litigate the issue. In a lengthy opinion that discusses the testimony in detail, the MSPB administrative judge found that Gannon was not a credible witness (AR000325), that the Postal Service had ample grounds for proposing discipline against Gannon (AR000324), and that Gannon could not show that he was subject to duress or coercion when he agreed to accept a demotion in exchange for the rescission of the notice of proposed removal that had been issued to him (AR000328-30). Because Gannon cannot show that the MSPB abused its discretion in reaching this conclusion, this Court upholds the MSPB's determination that Gannon did not suffer an adverse employment action because his demotion was voluntary.
III. The Postal Service's Legitimate Basis for Proposed Discipline.
Even if Gannon were able to establish a prima facie case of race discrimination, the Postal Service has shown a legitimate non-discriminatory reason for proposing that he be removed.
A Postal Service investigation (conducted by a white male employee) uncovered evidence that Gannon had misused his authority by coercing a subordinate to run a personal errand in exchange for his removal from restricted sick leave. Martikan Decl., Exhibits D and H. Gannon disputes this, but admits that he took Ray Bastian off of sick leave and also asked him to drive another employee to work during the same "10-second" conversation. Id., Exhibit A at 82. Ray Bastian has testified that he understood that a quid pro quo was intended. Martikan Decl., Exhibit K at 17. Misuse of supervisory authority is a violation of Postal Service regulations that would reasonably subject Gannon to discipline. Id., Exhibit J at 2.
IV. Gannon's Evidence of Pretext.
Because the Postal Service has articulated a legitimate, non-discriminatory reason for proposing that Gannon be removed, the burden of proof shifts back to Gannon to show that the Postal Service's stated reason for the discipline was a pretext for discrimination. Vasquez, 349 F.3d at 641. To meet this burden, Gannon argues that Frank Jackson — the Postal employee who issued Gannon the Notice of Proposed Removal — conducted an insufficient investigation, because he could not remember what happened to his notes from various interviews (that were conducted 11 years ago), and because Jackson had never observed Gannon engage in misconduct. Gannon's Brief at 15. Gannon also notes that Jackson had issued Notices of Proposed Removal to other Caucasian Postal employees. Id.
Gannon's first two arguments — that Jackson could not remember what had happened to his interview notes, and that Jackson did not personally observe Gannon engage in misconduct — do not establish pretext. Indeed, they do not even address the legitimacy of the Postal Service's reason for proposing discipline against Gannon. The arguments are also irrelevant because James Taylor — like Gannon, a white man — investigated Gannon himself and found reason for discipline. Martikan Decl., Exhibit C at 1 and Exhibit H. It was Taylor, not Jackson, who offered Gannon a demotion in exchange for the Postal Service's rescission of the Notice of Proposed Removal. Id., Exhibit A at 29-30. Jackson was not even present at that meeting. Id. at 27.
Gannon's third argument — that Jackson had issued Notices of Proposed Removal to other Caucasian employees — misstates Jackson's deposition testimony. In fact, Jackson testified that he could not remember the races of all of the employees to whom he had issued Notices of Proposed Removal, but that he remembered at least two African-American managers who were demoted from Gannon's facility at around the same time that Gannon accepted his demotion. Dryovage Decl., Exhibit 1 at 48:21-49:1; 50:3-19.
The Court finds that Gannon has failed to produce evidence that would raise an issue of material fact regarding whether the Postal Service's stated reason for proposing discipline against him was a pretext for race discrimination.
CONCLUSION
Gannon has failed to establish a prima facie case of race discrimination, because he cannot show that he suffered an adverse employment action. He has also failed to raise a disputed question of material fact regarding whether the Postal Service's stated reason for proposing discipline against him was a pretext for race discrimination.
Therefore, IT IS HEREBY ORDERED THAT Defendant's Motion for Summary Judgment is GRANTED. The clerk shall close the file and terminate all pending matters, including the pre-trial conference and trial.
IT IS SO ORDERED.