Opinion
CV-03-1744-ST.
October 7, 2004
OPINION AND ORDER
INTRODUCTION
Plaintiff, Erin Hire ("Hire"), alleges that her former employer, Hyperion Solutions Corporation ("Hyperion"), discriminated against her on the basis of her sex and pregnancy in violation of the Civil Rights Act of 1964, as amended, 42 USC § 2000e, et. seq. ("Title VII") (First Claim), and ORS § 659A.030 (Second Claim).
Hire's Second Claim does not specifically allege a violation of ORS 659A.030, but it is clear from the substance of the claim and the parties' arguments that Hire meant to allege a violation of Oregon state law prohibiting sex discrimination, which is set forth in this statute. Therefore, this court will construe Hire's Second Claim as alleging a violation of ORS 659A.030.
This court has original jurisdiction over the federal statutory claim under 28 USC § 1331 and supplemental jurisdiction over the state law claim under 28 USC § 1367. The parties have consented to trial by a Magistrate Judge (docket #14).
Hyperion has filed a Motion for Summary Judgment (docket #17) against both of Hire's claims. For the reasons stated below, this motion is DENIED.
LEGAL STANDARDS
FRCP 56(c) authorizes summary judgment if "no genuine issue" exists regarding any material fact and "the moving party is entitled to judgment as a matter of law." The moving party must show an absence of an issue of material fact. Celotex Corp. v. Catrett, 477 US 317, 323 (1986). Once the moving party does so, the nonmoving party must "go beyond the pleadings" and designate specific facts showing a "genuine issue for trial." Id. at 324, citing FRCP 56(e). The court must "not weigh the evidence or determine the truth of the matter, but only determines whether there is a genuine issue for trial." Balint v. Carson City, 180 F3d 1047, 1054 (9th Cir 1999) (citation omitted). A "` scintilla of evidence,' or evidence that is `merely colorable' or `not significantly probative,'" does not present a genuine issue of material fact. United Steelworkers of Am. v. Phelps Dodge Corp., 865 F2d 1539, 1542 (9th Cir), cert denied, 493 US 809 (1989) (emphasis in original) (citation omitted).
The substantive law governing a claim or defense determines whether a fact is material. T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F2d 626, 631 (9th Cir 1987). The court must view the inferences drawn from the facts "in the light most favorable to the nonmoving party." Id. (citation omitted). Thus, reasonable doubts about the existence of a factual issue should be resolved against the moving party. Id. at 631.
Additionally, the Ninth Circuit has set a high standard for granting summary judgment in employment discrimination cases. "[W]e require very little evidence to survive summary judgment in a discrimination case, because the ultimate question is one that can only be resolved through a searching inquiry — one that is most appropriately conducted by the factfinder, upon a full record." Schnidrig v. Columbia Mach., Inc., 80 F3d 1406, 1410 (9th Cir) (internal citations and quotations omitted), cert denied, 519 US 927 (1996).
FACTS
Because all material facts must be viewed in the light most favorable to the non-movant, this court will view the evidence in the light most favorable to Hire. A review of the parties' facts, as well as the other materials submitted by the parties, including affidavits and deposition excerpts, reveal the following facts.
Both parties have submitted documents with various attachments. Citations to affidavits and depositions are identified by the last name of the affiant or deponent, and citations are to the paragraph(s) of the affidavit or page(s) of the deposition transcript. Where witnesses executed more than one affidavit, the cited affidavit is identified by its volume number. Exhibits attached to affidavits or depositions are identified by the name of the affidavit or deposition to which they were attached, together with their exhibit number. All other citations are to the exhibit number of the parties' submissions.
I. Hire's Job Description and Early Performance
Hire started working for Hyperion as a Named Account Manager on November 1, 2000. Plaintiff's Exhibit 2. At the time she was hired, Hire had a Master's Degree and a 3.9 grade point average. Hire Depo, pp. 21-22.
Hire's job was to sell Hyperion's software to accounts within her territory, which was Oregon. Id. at 24-25. Before each fiscal year began, Named Account Managers were given sales goals for the year which were broken down into specific sales goals for each of the four quarters. Id. at 25; Defendant's Exhibit 6. Hyperion's fiscal year begins July 1 and ends the following June 30. La Bruna Depo, pp. 9-10. Before each fiscal year, including fiscal year 2003 (July 1, 2002-June 30, 2003), Hire signed a compensation plan acknowledging and accepting these performance requirements. Hire Depo, pp. 19, 43; Defendant's Exhibit 6. Hyperion paid Hire on a salary plus commission basis. If she had met her fiscal year 2003 sales goal, she would have earned $195,000, consisting of $80,000 base salary and $115,000 in sales commissions. Hire Depo, p. 40; Defendant's Exhibit 6.
In an evaluation dated March 1, 2002, Hire received a 3.5 overall performance rating on a scale of one to five, or between good and excellent, for her performance from November 1, 2000, to January 31, 2002, even though she failed to meet her quota expectations in 2001. Plaintiff's Exhibit 3, pp. 8-9. She steadily increased her revenue attainment throughout this period. Id. at 2. For fiscal year 2002, Hire exceeded her annual quota and received positive feedback from her supervisors about her performance. Hire Depo, pp. 35-39.
II. Chris Houston as Hire's New Supervisor
Chris Houston ("Houston") became Hire's supervisor in February 2003. Houston Depo, p. 3. His job as a Sales Director in Denver was to help his five Named Account Managers succeed. Id. at 4. He assisted in the closing of 60-70% of his subordinates' sales ( id. at 5), such as by going on client visits with them. Perez Depo, pp. 19, 20. Houston's superior was Christopher La Bruna ("La Bruna"). La Bruna Depo, p. 8.
Hyperion's directors, including Houston, are paid a salary plus bonuses based on the sales by their subordinates within their territory. Id. at 8, 12. Of their total compensation, approximately one-half is the incentive component. Id. at 9. During periods in which an employee was on leave, including maternity leave, Houston would get no credit for sales that the subordinate was not able to close. Id. at 51-52. Houston was aware that no credit for sales would affect his compensation. Houston Depo, p. 21.
Houston's first impression of Hire was that she was a hard worker and very talented. Tankersley Depo (Vol. II), p. 6. He told Amy Tankersley ("Tankersley"), an official in Hyperion's Human Resources Department, that he was impressed with Hire's past performance. Id. at 7.
III. Notice of Hire's Pregnancy
Hire informed Hyperion's Human Resources Department that she was pregnant in March 2003. Hire Depo, pp. 44-45. On approximately April 1, 2003, Hire told Houston she was pregnant. Id. at 46; Houston Depo, p. 18. Houston asked when she was due. Hire Depo, p. 47. Hire replied that she was due in September and may have said that she would take 12 weeks of leave at that time pursuant to the Family and Medical Leave Act of 1993 ("FMLA"), 29 USC §§ 2601-54. Id. at 48. Houston did not have any prior experience with a pregnant subordinate. Houston Depo, p. 21.
IV. Hyperion's Policies on Non-Performing Salespeople
Although a Named Account Manager is an at-will employee, Hyperion has a number of tools available to notify its employees of performance issues. Tankersley Depo (Vol. I), p. 7. These tools include performance evaluations, written warnings, corrective actions, corrective counseling, and performance improvement plans ("PIPs"). Id. at 7-8; Plaintiff's Exhibit 6.
A PIP can contain action items that a salesperson can take to meet his or her sales quotas. Tankersley Depo (Vol. I), p. 24. A PIP can have a variety of time parameters, such as 30-day, 60-day, and 90-day plans, or more time if required. Id. at 15. It is not uncommon for a PIP to give the employee only 30 days to improve his or her performance. Tankersley Declaration, ¶ 3. It is a case-by-case decision within the manager's discretion whether to put a salesperson on a PIP. Id.; Tankersley Depo (Vol. I), p. 15 Managers work with the Human Resources Department in order to create a PIP that fits the employee's situation. Id.
Both Houston and La Bruna were aware that a PIP could be used for an underperforming salesperson. Houston Depo, pp. 18, 35; La Bruna Depo, pp. 12-13.
V. Hire's Fiscal Year 2003 Performance and Termination
Hire's sales performance wavered throughout fiscal year 2003, both before and after Houston became her manager and learned she was pregnant. Defendant's Exhibit 7. In the first quarter of fiscal year 2003 (July-September 2002), Hire made only $1,708 in sales or 0.5% of her quarterly goal of $340,000. Id. at 2. In the second quarter (October-December 2002), Hire made $241,850 in sales or 56.9% of her $425,000 quarterly goal. Id. at 2-3. In the third quarter (January-March 2003), she made no sales at all, failing to meet her quarterly goal of $425,000. Id. at 3. This performance ranked her in the bottom ten of Hyperion's Named Account Managers nationwide for third quarter performance, along with seven others who had no sales. Plaintiff's Exhibit 19, p. 1.
One of these seven, David Lacagnina, was terminated by Hyperion on December 31, 2002, prior to the beginning of the third quarter of fiscal year 2003. Plaintiff's Exhibit 19, p. 3.
Houston had discussions with Tankersley in April 2003 or earlier about putting Hire on a PIP. Tankersley Depo (Vol. I), p. 17. He also agreed with La Bruna in the third week of April that Hire would be subject to termination unless she made her quota for the fourth quarter of fiscal year 2003. Houston Depo, pp. 15-17. Houston testified that he did not tell Hire at the time of this decision because he did not want to be a "demotivating factor" (id. at 17) or cause her to focus on closing a few prospective sales instead of cultivating future sales. Houston Declaration, ¶ 8. La Bruna thought that Houston did not want to put Hire on a PIP because he did not want to "terrify" her. La Bruna Depo, p. 67.
La Bruna told Tankersley on May 12, 2003, that anyone under 25% of their year-to-date sales quota needed to be terminated. Tankersley Depo (Vol. II), pp. 8, 13. On May 23, 2003, Tankersley reported to her supervisor, Kim Howard ("Howard"), that Hire would not be placed on a PIP. Id. at 13-15. Tankersley's notes of that date reflect "no plan offered. just termination." Plaintiff's Exhibit 16, p. 4.
Houston told Tankersley on May 30, 2003, that Hire did not have the right techniques or skills for her position. Tankersley Depo (Vol. II), pp. 18-19. Houston also told her that he had performance conversations with Hire before her pregnancy announcement. Id. at 28-29. Tankersley memorialized Houston's statements in her notes on the conversation. Plaintiff's Exhibit 16, pp. 5-6. Notwithstanding the information that Houston provided, at some point Tankersley recommended that Hire be put on a PIP. Id. at 36.
Contrary to what he told Tankersley, Houston did not say anything to Hire about her performance until May 27, 2003. Hire Aff, ¶ 2. On that date, 34 days before the end of the fourth quarter of fiscal year 2003, Houston telephoned Hire and told her she needed to meet her fourth quarter quota of $510,000. Hire Depo, p. 92; Houston Depo, pp. 15, 17. Hire was left with the impression that beginning with the next quarter ( i.e. first quarter of fiscal year 2004), she would be put on a 90-day PIP requiring improvements in her performance. Hire Depo, pp. 93-94, 97-98. Houston followed up their conversation with an e-mail that stated that unless Hire met her fourth quarter quota, she would be terminated on June 30, 2004. Plaintiff's Exhibit 7, p. 2.
After receiving the e-mail, Hire called Houston and left a message asking him to call. Id. at 98. In response, Houston left a voicemail message at Hire's home stating that if she had decided to "cash it in," he was prepared to accept her resignation. Defendant's Exhibit 10, p. 2; Hire Depo, pp. 105-07. Hire called back and said she was "absolutely not" resigning and that she intended to meet her fourth quarter goal. Hire Depo, pp. 110-11.
This voicemail message was later transcribed and submitted for the record. Kisch Aff, ¶ 11.
When Tankersley read Houston's e-mail to Hire, she was surprised by its warning of termination on June 30. Tankersley Depo (Vol. I), p. 18. According to Tankersley, she was not previously aware that Houston wanted to terminate Hire that quickly, and that he reached that decision on his own. Id.
On May 30, 2003, Hire called La Bruna, who stated that he was aware of the situation. Hire Depo, p. 112. Hire told La Bruna that Houston's demands did not meet her understanding of typical practice concerning how long someone had to improve their performance. Id. La Bruna started discussing his understanding of the situation, mentioned two others who had been put on a PIP, and said he was either going to ask Houston, or had already done so, to put Hire on a 90-day PIP. Id. at 113-114, 116, 118. He told Hire she would receive the plan on Monday, June 2, 2003 ( id. at 114) and that she was doing the right things and should just keep executing. Id. at 122.
La Bruna denies that he promised to put Hire on a PIP or brought up the names of others placed on a PIP. La Bruna Depo, p. 61.
Because Hire did not receive a plan on June 2, 2003, she spoke with Tankersley the next day and related the events with Houston and La Bruna. Id. at 124-25. Meanwhile, Hire spoke with another Sales Director, Dan Gudal ("Gudal"), who told her Hyperion did not characteristically offer only 30-day plans. Id. at 136-37. Gudal told Hire that typically an employee is alerted at the beginning of the quarter and given that quarter, or 90 days, to effect change and meet that quarter's goals. Id. at 141.
At the end of the fourth quarter on June 30, 2003, Hire's fourth quarter sales totaled $403,838, nearly 80% of her quarterly quota of $510,000. Defendant's Exhibit 7, p. 4. Two of Houston's other Named Account Managers also did not meet their quotas that quarter; Hire outperformed one in terms of quota attainment and total sales (Hansot) and outperformed the other in total sales (Freitag). Id. She was no longer ranked in the bottom ten of Hyperion's Named Account Managers nationwide that quarter. Plaintiff's Exhibit 19, p. 2. Hire's fourth quarter sales brought her up to 38% of her annual quota. Defendant's Exhibit 7, p. 5. Even Houston felt that Hire had a "very nice" quarter. Houston Depo, p. 28.
On July 1, 2003, Houston told Hire she was being terminated. Id. According to Houston, it was his decision to terminate Hire and he did not decide to do so until that day. Id. at 24.
VI. Hyperion's Contacts with a Job Headhunter
In late April 2003, the same month Hire told Houston she was pregnant, a job headhunter, Gyani Richards ("Richards"), contacted Houston on a "routine inquiry" into whether Hyperion had any job openings. Houston Declaration, ¶ 10. Houston told Richards there may be a vacancy for a Named Account Manager opening up in Portland. Id.; Perez Depo, pp. 4, 23-24; Plaintiff's Exhibit 8. At the end of April, Richards contacted Allen Perez ("Perez") as a prospect for filling the vacancy. Perez Depo, pp. 4, 9. Perez understood from others that Hire's job was the position in question. Id. at 9.
On May 1, 2003, Hire got a call from a person who had been informed by a headhunter that Hire's position may be opening up because she was going to be put on a PIP. Hire Depo, pp. 50-52.
In the middle to the end of May, Richards contacted Perez and told him to contact Houston, which Perez did at the end of May. Perez Depo, p. 10. According to Perez, Houston told him: "We're looking for a major account rep who would be focusing on strategic accounts in Oregon and Idaho." Id. at 12. On June 3, both Houston and La Bruna interviewed Perez in Seattle, Washington for Hire's position. Id. at 15, 16, 24-25; Plaintiff's Exhibit 9. On June 17, Tankersley noted that she should call Houston to "check in on Erin Hire." Plaintiff's Exhibit 16, p. 10. At the end of June, Richards told Perez that Hyperion was interested in hiring him. Perez Depo, pp. 16-17. On June 27, 2003, Rick Armstrong, a member of Hyperion's "Strategic Staffing" group, wrote to Allen Winder, Hyperion's General Manager for the Americas and La Bruna's boss (La Bruna Depo, pp. 4-5), that he would prepare the requisition to fill the Named Account Manager position in Portland, "but Amy Tankersley needs to discuss the timing with you due to the circumstances of the existing rep before we can move forward. Once we are all clear on this I will have the req opened immediately." Plaintiff's Exhibit 14. Perez was hired in mid-July 2003. Perez Depo, p. 17.
In the same notes, Tankersley also wrote that she should call Carl Freeberg, a manager in the sales department, and ask about the "timing of Tim's hire, etc." Plaintiff's Exhibit 16, p. 10; Tankersley Depo (Vol. II), p. 37. Tankersley later submitted a declaration clarifying that the "Tim" referenced in her notation was Tim Nicknish, not Tim Perez. Tankersley Declaration, ¶ 4.
VII. Houston's Treatment of Hire Compared with Other Employees
Both before and after Hire informed Houston she was pregnant, he never went to Portland to help Hire close a sale or visit her clients. Houston Depo, pp. 10, 41. He refused to come to Portland even when she requested him to visit two or three times. Id. at 11, 37. In Hire's opinion, Houston would not interact with her or provide her support and was not much involved in managing her. Hire Depo, pp. 58-59. However, Houston and La Bruna did help arrange a deal with Albertson's for which Hire was given full credit in the fourth quarter of fiscal year 2003. Houston Declaration, ¶ 16.
Houston made trips to Portland and Idaho to help Perez. Perez Depo, pp. 19-20. Although Perez never met a quarterly quota after being hired in mid-July 2003, he is still employed by Hyperion. Houston Depo, p. 22; Perez Depo, p. 18. This is true even though Perez is Hyperion's only Portland representative and Hyperion lowered his quota as compared to Hire. Perez Depo, p. 21 (fourth quarter quota was $470,000 and annual quota was $975,000). Perez has not been placed on a PIP. Perez Depo, p. 21. As of the date of Perez' deposition on July 28, 2004, Houston had told him to "focus" on improving his sales in particular quarters, but gave him no deadline or threat of termination of any kind. Perez Depo, pp. 22-23. However, in late August 2004, Houston told Perez that if he "did not improve his performance and make $250,000 in sales in the first quarter of fiscal year 2005, he will be terminated." Houston Declaration, ¶ 12. Since the first quarter ended September 30, 2004, Perez was given a little more than 30 days notice. Id.
Hire attained the lowest percentage of her annual quota of any salesperson in Houston's group. Plaintiff's Exhibit 18, p. 5. However, of Hyperion's nationwide sales force, 19 salespersons finished fiscal year 2003 by fulfilling a lower percentage of their annual quota than Hire. Busse Supp Aff, Attachment A, p. 2.
After Tankersley began working for Hyperion in July 2002, about 20 of Hyperion's approximately 60 Named Account Managers were put on a PIP. Tankersley Depo (Vol. I), pp. 9-10. Of that number, three to four were in La Bruna's region. Id. at 10-11. None were pregnant. La Bruna Depo, p. 51. Five to seven of the 20 are still employed by Hyperion. Tankersley Depo (Vol. I), p. 11.
DISCUSSION
Hyperion contends that it fired Hire because she failed to meet her sales quota in the fourth quarter of fiscal year 2003, not because of her pregnancy. For the reasons that follow, genuine issues of material fact preclude summary judgment for Hyperion.
I. Burdens of Proof in Sex Discrimination Claims
Title VII makes it an unlawful employment practice "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 . . . sex." 42 USC § 2000e-2(a)(1). The term "because of sex" includes "because of or on the basis of pregnancy, childbirth, or related medical conditions." 42 USC § 2000e(k). An employer violates Title VII if a protected characteristic is a "motivating factor" in the employment action; it need not be the only factor. 42 USC § 2000e-2(m).
A plaintiff may respond to a summary judgment motion against her Title VII claim either by using the McDonnell Douglas burden-shifting analysis or by introducing direct evidence that demonstrates the defendant was more likely than not motivated by a discriminatory reason. McDonnell Douglas v. Green, 411 US 792, 802 (1973) ; McGinest v. GTE Serv. Corp., 360 F3d 1103, 1122 (9th Cir 2004).
Under McDonnell Douglas, the plaintiff first must establish a prima facie case. McDonnell Douglas, 411 US at 802. To establish a prima facie case, the plaintiff "need only offer evidence that gives rise to an inference of unlawful discrimination." Wallis v. J.R. Simplot Co., 26 F3d 885, 889 (9th Cir 1994) (internal quotations omitted). The degree of proof required to establish a prima facie case "on summary judgment is minimal and does not need to rise to the level of a preponderance of the evidence." Id. After the plaintiff establishes a prima facie case, the burden shifts to the employer to articulate a legitimate, nondiscriminatory reason for its action. Id. The burden then shifts back to the employee to show that the asserted reason was a pretext for discrimination. Id. at 890.
Oregon applies the same standard for establishing a prima facie case of discrimination as under federal law. Pascoe v. Mentor Graphics Corp., 199 F Supp 2d 1034, 1052 (D Or 2001), citing Henderson v. Jantzen, Inc., 79 Or App 654, 657, 719 P2d 1322, 1324, rev denied, 302 Or 35, 726 P2d 934 (1986). However, Oregon courts have rejected the McDonnell Douglas burden-shifting framework. Id. citing Callan v. Confederation of Oregon Sch. Admin'rs, 79 Or App 73, 77, 717 P2d 1252, 1254 (1986). Therefore, when a plaintiff introduces evidence showing that her discharge took place under circumstances giving rise to an inference of unlawful discrimination, and thereby "establishes a prima facie claim of . . . discrimination, summary judgment is inappropriate even in the face of assertions by the defendant of nondiscriminatory action." Id. quoting Hardie v. Legacy Health Sys., 167 Or App 425, 437, 6 P3d 531, 538 (2000) (citing Messick v. Horizon Indus. Inc., 62 F3d 1227, 1232 (9th Cir 1995) (applying Henderson, supra)).
II. Prima Facie Case
Hire does not submit any direct evidence of sex discrimination. Without direct evidence of discrimination, Hire can establish a prima facie case of pregnancy discrimination within the McDonnell Douglas framework if she proves that: (1) she is a member of a protected class; (2) she was qualified for the position; (3) she was subjected to an adverse employment action; and (4) similarly situated men or non-pregnant women were treated differently or her position was filled by a man or non-pregnant woman. Villiarimo v. Aloha Island Air, Inc., 281 F3d 1054, 1062 (9th Cir 2002), citing McDonnell Douglas, 411 US at 802 and St. Mary's Honor Ctr. v. Hicks, 509 US 502, 506 (1993); Pejic v. Hughes Helicopters, Inc., 840 F2d 667, 672 (9th Cir 1988).
Hyperion does not dispute that Hire has satisfied three of the four elements of a prima facie case, but contends that Hire was not qualified for her position because she failed to meet her sales quotas, especially her quota for the fourth quarter of fiscal year 2003. This argument somewhat conflates the issue at the prima facie stage, where a plaintiff need only make a minimal showing that she is qualified, with the issue at the third stage that an employer's reasons were not pretextual, which a plaintiff can only overcome with a specific, substantial showing. The Ninth Circuit has warned against conflating these two stages. Aragon v. Rep. of Silver State Disposal, 292 F3d 654, 659 (9th Cir 2002). Indeed, in a case where the employer argued the plaintiff could not establish he was performing his job satisfactorily, the Ninth Circuit deferred discussion of that issue until the pretext stage. Messick, 62 F3d at 1229-30.
Considering these precedents, and the generally low standard at the prima facie stage, Hire has met her burden here. Hire was qualified for her position at the time she was hired. The issue is whether she remained qualified at the time she was terminated. Hire met almost 80% of her fourth quarter sales goal. Although this performance alone does not demonstrate that Hire was qualified for her position, it is a substantial improvement over her performance in the prior three quarters. Other evidence (discussed more fully below) indicates that strictly meeting sales quotas was not necessarily a qualification for the position, at least with respect to similarly situated Named Account Managers nationwide and in Houston's region.
Furthermore, it is important to note that although Hire underperformed in three previous quarters, she received no warning about her job performance until barely a month before the fourth quarter was to end and after she informed Houston she was pregnant. This lack of warning about gives rise to an inference that the short deadline for her improving job performance was given in a discriminatory manner. In that regard, this case is similar to Cleese v. Hewlett Packard Co., 911 F Supp 1312, 1318 (D Or 1995), in which the defendant employer argued that its employee was nonperforming as evidenced by disciplinary actions based on dependability, integrity, and judgment. Nevertheless, the employee satisfied the second element of a prima facie case because she had never been previously reprimanded for the quality of her work, leading to the inference that the discipline for ancillary behavior was discriminatory.
In addition, Houston's statement to Tankersley on May 30, 2003, that he gave Hire performance warnings prior to learning about her pregnancy, which Tankersley both remembered him making and wrote down in her notebook, directly conflicts with Hire's testimony that Houston expressed no concerns about her performance until the May 27, 2003 e-mail. This conflicting testimony alone raises an inference that Houston may have discriminated against Hire because of her pregnancy, and then sought to cover up his actions when faced with an inquisitive human resources staff member.
Furthermore, the Ninth Circuit has tacitly found a prima facie case because a retaliatory action was taken 42 days after a protected action. Miller v. Fairchild Industries, Inc., 885 F2d 498, 505 (9th Cir 1989). Hire received the termination warning less than 60 days after she informed Houston of her pregnancy, which is comparable to the 42 days in Miller.
Accordingly, Hire has met the low standard of establishing a prima facie case of sex discrimination. As in Messick, 62 F3d 1227, 1229-30, Hyperion's arguments regarding Hire's inability to meet her sales quotas are best left to the pretext stage.
III. Pretext A. Legal Standard
Hyperion has submitted a legitimate, nondiscriminatory reason for terminating Hire, namely her inability to meet her sales quota for the fourth quarter of fiscal year 2003. Therefore, Hire must demonstrate that this purported reason is a pretext for discriminating against her on the basis of her pregnancy.
Hyperion cites St. Mary's Honor Center v. Hicks, 509 US 502, 515 (1993), for the proposition that in order to survive summary judgment at the pretext stage of this analysis, Hire must prove that a reasonable jury could find: (1) that Hyperion's proffered reason for terminating her is false; and (2) that pregnancy discrimination was the real reason. Hyperion is only partially correct. While it is true that a jury must ultimately "disbelieve the employer" and "believe the plaintiff's explanation of intentional discrimination" ( id. at 519), the jury can "infer the ultimate conclusion of discrimination from the falsity of the employer's explanation." Reeves v. Sanderson Plumbing Prod., Inc., 530 US 133, 147 (2000). Indeed, "[p]roof that the defendant's explanation is unworthy of credence is simply one form of circumstantial evidence that is probative of intentional discrimination, and it may be quite persuasive." Id. Other factors to consider in determining pretext include what information is known to the defendant at the time of the adverse employment decision, the plausibility of the explanations offered in light of the evidence, and any inconsistencies within the explanations offered. Norris v. City and County of San Francisco, 900 F2d 1326, 1331 (9th Cir 1990).
The plaintiff's burden when attempting to prove pretext is much greater than at the prima facie stage. Where an employee attempts to prove pretext with circumstantial evidence, as here, she may do so only by offering "specific" and "substantial" evidence "that tends to show that the employer's proffered motives were not the actual motives because they are inconsistent or otherwise not believable." Godwin v. Hunt Wesson, Inc., 150 F3d 1217, 1222 (9th Cir 1998).
B. Analysis
Although Hire's fiscal year 2003 sales performance was poor by all objective measures, a reasonable jury could nonetheless conclude for several reasons that pregnancy discrimination was the real motive for her termination.
As evidence of pretext, Hire first points to the close proximity between her notification to Houston of her pregnancy and her May 27, 2003 termination warning. While timing is useful in establishing a prima facie case, as discussed earlier, it does not bear as much weight in the pretext stage. The Ninth Circuit has held that a period of six weeks between a protected activity and the employee's termination is insufficient to prove pretext. Stegall v. Citadel Broadcasting Co., 350 F3d 1061, 1076 (9th Cir 2003). It differentiated the situation from Little v. Windermere Relocation, Inc., 301 F3d 958 (9th Cir 2002), where the termination came minutes after the protected activity. Moreover, unlike Little, where the employee's termination stood alone, in Stegall the employer had other reasons for the termination, such as the broad overhaul of its business it was undertaking. Similarly, Hyperion had other reasons for its actions — namely Hire's poor performance — which may not be enough to defeat Hire's pretext arguments, but are enough to prevent the timing of the warning alone from demonstrating pretext.
In contrast, the circumstances surrounding Hyperion's interaction with Richards, the headhunter who recruited Perez, do raise a material issue of fact as to pretext. Even if Richards contacted Houston first as part of a routine search for job vacancies, Houston responded by telling Richards there might soon be an opening in Portland. Houston gave this response in April 2003, the very same month that Hire informed him she was pregnant. While it is true that Hire failed to make any sales in the third quarter ending just prior to April, Houston had not given her any warnings that her performance was inadequate or that she faced termination. Moreover, Hire had sufficient potential sales that could be closed by the end of the fourth quarter to meet her quota. Houston Declaration, ¶ 9. Therefore, a reasonable jury could find that Houston's decision to inform a headhunter that Hire's job was at risk was driven by a desire to terminate a pregnant employee. This is particularly true when Houston did not inform Hire that she faced termination until almost a month after he and others continued to interact with Richards. Hyperion's arguments that Houston (and La Bruna) delayed giving this warning because they did not want to demotivate or terrify Hire, and that they would not have hired Perez or terminated Hire if she met her fourth quarter sales, are credibility issues best left to the jury.
Houston's compensation package, which would be reduced while Hire was away on maternity leave, also gave Houston a financial incentive to discriminate against her. Hyperion argues that Houston stood to lose even more money from firing Hire and then replacing her with a new salesperson, who, per Hyperion's policies, would not have sales quotas for two quarters and lower quotas for the third and fourth quarters of his first year. Houston Declaration, ¶ 13. However, Hyperion's length of time between the initial solicitation of a client and a possible sale, the so-called "sales pipeline," was as much as a 12-month cycle. Hire Depo, p. 73. Therefore, Houston might not have lost more money on a new employee who would be producing little for the first 12 months. Indeed, a jury could conclude that Houston decided he would earn more commissions from a new employee due to Hire's lack of sales during maternity leave and other distractions caused by a new baby. Because Perez had previously worked as a salesperson for Hyperion (Perez Depo, p. 9), it was not necessarily a risk for Houston to terminate Hire and hire Perez. Perez could have been perceived as an experienced salesperson who could both replace Hire and make more sales than a normal new replacement.
Hire's evidence that she was treated differently than other Named Account Managers who failed to meet their sales quotas is also sufficient to establish pretext. See Lowe v. City of Monrovia, 775 F2d 998, 1008 (9th Cir 1985) ("A disparate treatment plaintiff may rely on statistical evidence to establish a prima facie case, or `to show that a defendant's articulated nondiscriminatory reason for the employment decision in question is pretextual" (quoting and citing Diaz v. Am. Tel. Telegraph, 752 F2d 1356, 1362-63 (9th Cir 1985)). Although it is within a Sales Director's discretion to place a Named Account Manager on a PIP, and Houston did not place any others on a PIP, it is relevant that Hyperion placed numerous other Named Account Managers who were underperforming on PIPs and did not terminate them. Tankersley Depo (Vol. I), pp. 10-11. According to one other Sales Director, Gudel, Hyperion typically gave employees 90 days to meet goals. Had Hire been placed on a PIP, especially earlier in the fourth quarter, she would have had more advance notice of her risk of termination and a better chance of avoiding termination since she had enough potential business in the pipeline to meet her fiscal year 2003 fourth quarter quota. Houston Declaration, ¶ 9. The credibility of Houston's explanation that he views PIPs as most helpful to an employee who does not have explicit goals or who has conduct or professionalism problems (Houston Declaration, ¶ 7) is an issue best left to the jury, especially considering that Houston admitted he read the portions of Hyperion's employment manual recommending the use of PIPs and containing no specific limits on the situations in which they should be used. Houston Depo, p. 35; Plaintiff's Exhibit 6, p. 4. Moreover, La Bruna was apparently very involved in Hire's termination and replacement, yet Named Account Managers within his area were placed on PIPs. Indeed, it is hard to explain why Houston refused to put Hire on a plan when both La Bruna and Tankersley favored it.
Houston's credibility as to his motives for his conduct, including contacts with the headhunter, the effect of his compliance package on his decisions, and his refusal to place Hire on a PIP, are all seriously called into question by the inconsistency between his statements to Tankersley that he warned Hire about her performance before she announced her pregnancy and Hire's testimony that Houston expressed no concerns about her performance until the May 27, 2003 e-mail. This conflicting testimony raises substantial questions from which a jury could infer that Houston's explanations are false, and the actual purpose of his actions was discrimination.
Additionally, evidence demonstrating that Hyperion did not terminate other Named Account Managers who failed to meet their sales quotas either in fiscal year 2003 as a whole or in the fourth quarter of fiscal year 2003 also demonstrates pretext. Of the 15 Named Account Managers who finished below Hire for the whole of fiscal year 2003, nine either kept their jobs as Named Account Mangers or were transferred to another position within the company, and many of those who left the company did so in mutual consent or for career advancement. Compare Plaintiff's Exhibit 19, pp. 1-2 with Busse Supp Aff, Exhibit A, p. 2 and Tankersley Declaration, ¶ 6. At least one of those terminated was a woman, Jennifer Wilson, but it is unclear how many of the others who either kept their jobs or were terminated were women. Id. Hire was the only woman working for Houston. Plaintiff's Exhibit 18, p. 1. Similarly, five employees in the bottom 10 who failed to meet their fourth quarter quotas and also finished below Hire in annual quota attainment for fiscal year 2003 remain employed by Hyperion, either as Named Account Managers or in another position (Lombardi, Hernandez, Patton, Howell, and Szymanski). Compare Plaintiff's Exhibit 19, pp. 1-2 with Busse Supp Aff, Exhibit A, p. 2 and Tankersley Declaration, ¶ 6.
Both parties repeatedly confuse the statistics on annual quota attainment of Hyperion's Named Account Managers in fiscal year 2003 as a whole, which is found in a chart labeled Exhibit A, pp. 2-4, attached to the Busse Supp Aff (docket #24), with the numbers of Named Account Managers who finished in the bottom 10 in either the third or fourth quarters of fiscal year 2003, which is found in a chart labeled Plaintiff's Exhibit 19, pp. 1-2. The comparison is further confused when the parties attempt to compare either of these data sources with the names of Named Account Managers who were terminated. Plaintiff's Exhibit 19, pp. 3-17, includes resignation letters and personnel forms indicating the termination (and sometimes the reason for termination) of the following Named Account Managers between December 31, 2002, and April 14, 2004: David Lacagnina, Larry Krebs, Jennifer Marsland, Todd Gibson, Greg Willmott, Peter Grodecky, Todd Caponi, and John Scott. However, four of these terminated employees (Jennifer Marsland, Todd Gibson, Todd Caponi, and John Scott) were not in the bottom 10 in either the third or fourth quarters of fiscal year 2003. See id. at 1-2.
Tankersley's Declaration provides a little more information about what Named Account Managers were terminated, but only clarifies the issue partly. Tankersley testified that after fiscal year 2003, Chris Patton and John Hernandez, both of whom were in the bottom 10 in the third and fourth quarters of fiscal year 2003, were transferred to other positions within Hyperion and are no longer Named Account Managers. Tankersley Declaration, ¶ 6. Additionally, Jennifer Wilson and Kenneth Daniel, both of whom finished in the bottom 10 in the fourth quarter of fiscal year 2003, are no longer working for Hyperion. Id. No explanation of the circumstances surrounding their departure was given. Id.
As a result, it is difficult to determine how many of the 19 Named Account Managers who finished below Hire in total quota performance for fiscal year 2003 left the company (either voluntarily or involuntarily), or how many of the 16 Named Account Managers (including Hire) who were in the bottom 10 in the third or fourth quarters of fiscal year 2003 (four of the salespeople were in the bottom 10 in both quarters) left the company.
However, some conclusions can be reached. All of the 15 Named Account Managers besides Hire who finished in the bottom 10 in the third or fourth quarters of fiscal year 2003 also finished below her in total quota performance for the entire fiscal year 2003. Compare Plaintiff's Exhibit 19, pp. 1-2 with Busse Supp Aff, Exhibit A, p. 2. Of these 15, seven were not terminated according to the documents produced by Hyperion (Clay, Freitag, Lang, Lombardi, Perreault, Howell, and Szymanski). Id. Two of the 15 were transferred to other jobs in Hyperion rather than being terminated (Hernandez and Patton). Tankersley Declaration, ¶ 6.
Hyperion argues this evidence of company-wide treatment of Named Account Managers is irrelevant. Hyperion contends the only Named Account Managers to which Hire should be compared are those in Houston's group.
In general, "in the context of investigating an individual complaint the most natural focus is upon the source of the complained of discrimination — the employing unit or work unit." Earley v. Champion Intern. Corp., 907 F2d 1077, 1084 (11th Cir 1990), quoting Marshall v. Westinghouse Elec. Corp., 576 F2d 588, 592 (5th Cir 1978). "Where . . . the employment decisions were made locally, discovery on intent may be limited to the employing unit." Id. citing Mack v. Great Atl. Pac. Tea Co., Inc., 871 F2d 179, 187 (1st Cir 1989).
Although Houston claims it was his decision to terminate Hire, La Bruna had a substantial role in both terminating Hire and in hiring Perez. La Bruna consulted with Hamilton about Hire's performance, told Tankersley that anyone under 25% of their year-to-date sales quota needed to be terminated (which would include Hire), and participated in the interview of Perez. Therefore, at the very least, La Bruna's region must be considered the relative unit for comparison.
Moreover, in the May 27, 2003 e-mail to Hire, Houston listed her failure to meet her first, second and third quarter goals and her "rank among the bottom 10 of all Hyperion sales executives" as reasons why she needed to "understand the consequences of not meeting [her] assigned 4th quarter revenue objective." Plaintiff's Exhibit 7, p. 2. Therefore, it is apparent that Hire's performance was being compared to Hyperion's nationwide sales force. As a result, the evidence of how Hyperion's Named Account Managers nationwide were being treated is relevant to demonstrate discrimination.
Even if the only relevant group was Houston's, an issue of fact exists. Hansot, the employee in Houston's region who failed to meet his fiscal year 2003 fourth quarter and annual quotas, was not terminated (though he did achieve more of his annual quota than Hire). Defendant's Exhibit 7, p. 4.
In addition, Hyperion's treatment of Perez also demonstrates disparate treatment. Perez apparently did not have a quota the first two quarters after he replaced Hire. Although Hyperion reduces sales quotas for the third and fourth quarters of a new salesperson's first year "from what we would expect from an experienced salesperson" (Houston Declaration, ¶ 13), Perez failed to meet even these reduced sales quotas in the third and fourth quarters of his first year. Yet Perez received no threat of termination until August 2004, a short time after his deposition and a month into his second fiscal year with Hyperion. This lack of accountability is particularly difficult to explain considering that Perez had previously worked as a salesperson for Hyperion.
Accordingly, Hire has demonstrated sufficient evidence of pretext to rebut Hyperion's proffered non-discriminatory reason for terminating her.
ORDER
For the reasons stated above, Hyperion's Motion for Summary Judgment (docket #17) is DENIED.