Diana Palacios v. City of Crystal City, Texas, et al

Filing

UNPUBLISHED OPINION FILED. [14-51176 Affirmed ] Judge: WED , Judge: JWE , Judge: CH Mandate pull date is 09/01/2015 [14-51176]

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IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit

No. 14-51176

FILED
August 11, 2015
Lyle W. Cayce
Clerk

DIANA PALACIOS,
Plaintiff–Appellant,

v.

CITY OF CRYSTAL CITY, TEXAS; MAYOR RICARDO S. LOPEZ;
COUNCILMAN RICHARD DIAZ; COUNCILMAN JOSE SENDEJO,
Defendants–Appellees.

Appeal from the United States District Court
for the Western District of Texas
USDC No. 2:11-CV-53
Before DAVIS, ELROD, and HAYNES, Circuit Judges.
PER CURIAM:*
Following the 2009 election season and a change in control of the city
council of the City of Crystal City, the city council terminated Diana Palacios
as city manager and replaced her with a younger male, Alfredo Gallegos.
Palacios sued alleging, as relevant here, sex and age discrimination. The
district court granted summary judgment for the city because Palacios failed
to create a genuine issue of material fact as to whether the city’s proffered

Pursuant to Fifth Cir. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in Fifth
Cir. R. 47.5.4.
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legitimate, non-discriminatory reasons for her termination were pretextual.
Because Palacios has not created a genuine issue of material fact as to whether
the city’s reasons for her termination were pretextual, we AFFIRM the district
court’s grant of summary judgment.
I.
In June 2003, the city council of the City of Crystal City, Texas hired
Diana Palacios as city manager. The city councilmembers who voted to hire
Palacios included Ricardo Lopez, who is now the mayor of the city and a
defendant in this case. Palacios served as city manager until June 2009, when
she was terminated by a majority vote of the city council. She was fifty-seven
years old.

She was temporarily replaced by interim city manager John

Camarillo. The city then advertised to permanently fill the city manager
position. The city council interviewed applicants and hired Alfredo Gallegos
as the new city manager in August 2009.
Prior to the 2009 election cycle, the city council was composed of
Councilman (now Mayor) Lopez, Councilman Victor Bonilla III, Councilman
Ray Espinosa, Councilman Guillermo Santos Jr., and Mayor Benito Perez.
Preceding the 2009 election, according to the city councilmembers’ deposition
testimony, they became concerned about several mismanagement and
financial issues, including the city hiding its police cars to protect them from
repossession and experiencing a blackout because it failed to pay its electric
bill. During this time, Palacios also was personally the subject of negative
media attention.
Richard Diaz and Jose Sendejo, city residents, stated in their depositions
that they specifically became concerned with potential mismanagement and
the negative media attention generated by Palacios. Both men decided to run
for city council on a platform of changing the city administration, including
Palacios. Sendejo testified that he decided to run for city council because he
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wanted to “help out and make a difference” and because people in the
community urged him to run.

During Sendejo’s deposition the following

exchange took place:
Q.

And you – what prompted you to run?

A.

A lot of it was the community telling me – you
know, once I announced that I was looking into,
you know, running for councilman, a lot of
people approached me. You know, yes, we need
a change, you know, and we need some more
younger people or different people to go in there
and try to make better decisions.

Q.

Okay. What – and did you – is that basically
what your platform was based upon?

A.

Yes. Wanted to help out and see if I could make
a difference.

Later in the deposition, Palacios’s attorney asked Sendejo the following
question: “you mentioned that others had come to you and said they, I guess,
wanted new blood . . . younger blood in the City administration, correct?”
Sendejo responded that this was correct. Palacios’s attorney was the only
person to use the phrase “younger blood.”
Diaz and Sendejo both won seats on the city council. Shortly after joining
the city council, Diaz requested that Palacios put an item on the agenda of the
next city council meeting regarding her continued employment. Diaz also
drafted a preliminary resolution for Palacios’s removal. The resolution listed
grounds for termination as: (1) that the council lost confidence in the ability of
the city manager to manage the city according to generally accepted
management principles; (2) that the city manager knowingly failed to comply
with the collateral agreement on a loan with the Zavala Country Bank, which
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exposed the city to risk as a borrower; and (3) that the city manager
mismanaged the sales taxes approved by the voters that were designed for
street repairs. Mayor Perez refused to allow the resolution to go forward.
Councilman Lopez then moved to terminate Palacios’s employment due to a
“lack of confidence.” Sendejo, Lopez, and Diaz, a majority of the city council,
voted in support of the motion to terminate Palacios.
Following Palacios’s termination, the city council temporarily replaced
her with interim city manager John Camarillo, a male approximately her same
age. The city council then advertised the city manager position in the local
newspaper. The position announcement listed several ways that an applicant
could demonstrate that he or she was qualified, including specified
combinations of education and experience or “any equivalent combination of
experience and training which provides the required knowledge, skills, and
abilities.”

The required knowledge, skills, and abilities were specifically

identified in the announcement and generally included management ability,
interpersonal skills, knowledge of budgets, communication skills, data
analysis, and the ability to prioritize and implement city policies.
Several people applied for the position, including Alfredo Gallegos and a
female applicant. The female applicant had one year’s experience as a city
manager during which she worked for two different cities. Her academic
credentials were not specified. Gallegos had a bachelor’s degree in business
administration in accounting, but no experience in public administration.
According to Lopez, Diaz, and Sendejo, the city council elected not to hire the
female applicant because it learned during the interview that she had difficulty
getting along with the city council in the cities where she had previously served
as city manager, and that she had been terminated from her previous
employment as city manager. The city council hired Gallegos.
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Palacios sued in Texas state court alleging breach of contract and
violations of the Texas Open Meetings Act, and seeking a writ of mandamus
and declaratory relief. The city asserted an immunity-based defense that was
denied by the trial court, and the city appealed.

While that appeal was

pending, Palacios sued the city in the federal district court, alleging age and
sex discrimination. Texas’s Fourth Court of Appeals subsequently dismissed
Palacios’s breach of contract claim and remanded her other claims to the state
trial court, where Palacios added federal constitutional claims. The city then
removed the case to federal court, and both cases were consolidated. The
district court granted summary judgment for the city on all claims and Palacios
now appeals only the grant of summary judgment as to her age and sex
discrimination claims.
II.
We review the grant of summary judgment de novo. LeMaire v. La. Dep’t
of Trans. & Dev., 480 F.3d 383, 386 (5th Cir. 2007). “Summary judgment is
appropriate when, after considering the pleadings, depositions, answers to
interrogatories, admissions on file, and affidavits, there is no genuine issue as
to any material fact and . . . the moving party is entitled to a judgment as a
matter of law.” Id. at 387 (alteration in original) (internal quotation marks
omitted).
A.
The Age Discrimination in Employment Act (ADEA) “prohibit[s]
employers from discharging or otherwise discriminating against any
individual because of his or her age.” Miller v. Raytheon Co., 716 F.3d 138, 144
(5th Cir. 2013); see 29 U.S.C. § 621. Under the ADEA, it is unlawful for an
employer “to discharge any individual or otherwise discriminate against any
individual . . . because of such individual’s age.” 20 U.S.C. § 623(a)(1); accord
Phillips v. Leggett & Platt, Inc., 658 F.3d 452, 455 (5th Cir. 2011). To establish
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a claim under the ADEA, “[a] plaintiff must prove by a preponderance of the
evidence (which may be direct or circumstantial), that age was the ‘but-for’
cause of the challenged employer decision.” Gross v. FBL Fin. Servs., Inc., 557
U.S. 167, 177–78 (2009). A plaintiff may prove her case by either direct or
circumstantial evidence.

Id.

“If a plaintiff produces direct evidence of

discrimination, no further showing is required, and the burden shifts to the
employer.” Berquist v. Wash. Mut. Bank, 500 F.3d 344, 349 (5th Cir. 2007).
“Direct evidence of discrimination is evidence which, if believed, would prove
the existence of a fact (i.e., unlawful discrimination) without any inferences or
presumptions.” Bodenheimer v. PPG Indus., Inc., 5 F.3d 955, 958 (5th Cir.
1993).
A plaintiff relying on circumstantial evidence must prove her claims
under the burden-shifting framework of McDonnell Douglas Corp. v. Green,
411 U.S. 792, 802 (1973). She must “put forth a prima facie case, at which
point the burden shifts to the employer to provide a legitimate, nondiscriminatory reason for the employment decision.” Berquist, 500 F.3d at 349.
If the employer provides a legitimate, non-discriminatory reason, then the
burden shifts back to the plaintiff to prove that “the employer’s proffered
reason was not true—but was instead a pretext for age discrimination—or
that, even if the employer’s reason is true, [s]he was terminated because of
h[er] age.” Miller, 716 F.3d at 144. At the summary judgment stage, “the
question is whether the plaintiff has shown that there is a genuine issue of
material fact as to whether this reason was pretextual. A plaintiff may show
[a genuine issue of material fact regarding] pretext either through evidence of
disparate treatment or by showing that the employer’s proffered explanation
is false or unworthy of credence.” Moss v. BMC Software, Inc., 610 F.3d 917,
922 (5th Cir. 2010) (alterations omitted) (internal citations and quotation
marks omitted).
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The district court assumed arguendo that Palacios had made out a prima
facie case of age discrimination and only addressed Palacios’s failure to create
a genuine issue of material fact regarding pretext.

As a legitimate, non-

discriminatory reason for termination, the city offered evidence that the city
council was dissatisfied with Palacios’s job performance and lacked confidence
in her ability to manage the city going forward. The burden on the city is one
of production, not persuasion, and to meet that burden the city need only
produce evidence “which, taken as true, would permit the conclusion that there
was a nondiscriminatory reason for the adverse action.” Daigle v. Liberty Life
Ins. Co., 70 F.3d 394, 396 (5th Cir. 1995) (internal quotation marks omitted).
Poor job performance is a legitimate, nondiscriminatory reason for
termination. LeMaire, 480 F.3d at 391.
The city produced evidence that Palacios was terminated for poor job
performance. Councilmembers Lopez, Sendejo, and Diaz each testified in their
depositions that they were dissatisfied with her performance.

Specifically,

Lopez testified that he had concerns about the city’s failure to pay its electric
bill, failure to demolish burnt-down houses, and failure to timely comply with
the terms of a bank loan. Lopez also testified that he had expressed to Palacios
at various points during her tenure as city manager that he was dissatisfied
with her job performance in certain areas. This is reflected in Palacios’s 2006
performance evaluation. Lopez gave Palacios an overall rating of satisfactory,
but also included a number of comments about his concerns with Palacios’s
performance, including concerns about the city’s ability to cover its payroll,
Palacios’s failure to respond to city councilmembers’ requests in a timely
fashion, and failure to properly monitor the city’s economic development
officer.
In Palacios’s 2008 performance evaluation, she again received an
average score of satisfactory, but received below satisfactory scores from at
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least one of the five city councilmembers in each of the following areas: budget,
financial analysis, strategic planning, supervision, personnel, leadership,
integrity, council relations, agenda management, policy and administration,
community reputation, citizen’s relations, intergovernmental relations, and
economic development. Lopez again included many comments about issues
with Palacios’s performance.
In his deposition, Diaz testified that he ran for city council because he
had been concerned about the quality of the city’s management, the city’s
treatment of particular bonds, the city’s failure to pay for its police cars, the
power outage, and Palacios’s treatment of an escrow fund that was slated to
pay off a specific loan. Diaz’s campaign also explicitly criticized Palacios’s
treatment of a bond issue and accused her of “misleading the city council and
the community.” Sendejo also testified that he was concerned about the budget
and the city’s management. He stated that he became aware of the problems
with the city’s management prior to taking office by reading the newspaper.
In the face of the city’s evidence of a legitimate, non-discriminatory
reason for her termination, Palacios argues that the city’s reason is pretextual
because: (1) the city council’s cited reason of “lack of confidence” is legally
insufficient because it is too vague; (2) Diaz and Sendejo could not have formed
an opinion about Palacios’s performance because they were on the city council
for only 29 days prior to her termination; (3) the city council failed to follow its
own procedures for termination; (4) Gallegos was so unqualified and
inexperienced that his hiring is evidence of pretext; and (5) Sendejo made
specific statements indicating that he wanted a younger city manager. We
address each of these in turn.
First, Palacios contends that a stated reason for an adverse employment
action must be sufficiently specific in order to constitute a legitimate, nondiscriminatory reason. See Patrick v. Ridge, 394 F.3d 311 (5th Cir. 2004). In
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Patrick, we held that the statement that a plaintiff was “not sufficiently suited”
for a position was not specific enough to constitute a “legitimate, nondiscriminatory reason.”

394 F.3d at 316–17.

“[J]ustifying an adverse

employment decision by offering a content-less and nonspecific statement, such
as that a candidate is not ‘sufficiently suited’ for the position, is not specific
enough to meet a defendant employer’s burden of production under McDonnell
Douglas. It is, at bottom, a non-reason.” Id. at 317.
Unlike in Patrick, the city councilmembers here have each provided a
lengthy explanation of their concerns regarding Palacios’s job performance.
Though Palacios was officially terminated for “lack of confidence,” it was only
after Mayor Perez blocked Diaz’s more specific resolution that the city council
instead terminated Palacios for “lack of confidence” via a shorter, bare-bones
motion. The city produced a great deal of evidence to demonstrate precisely
what was meant by the city councilmembers’ “lack of confidence” in Palacios.
In addition to the deposition testimony, the record shows that the initial
resolution to remove Palacios from her position listed specific reasons that the
city council was dissatisfied: (1) the city council lost confidence in the ability of
the city manager to manage the city according to generally accepted
management principles; (2) the city manager knowingly failed to comply with
the collateral agreement on a loan with the Zavala Country Bank which
exposed the city to risk as a borrower; and (3) the city manager mismanaged
the sales taxes approved by the voters that were designed for street repairs.
The city also relies on Palacios’s performance evaluations from prior
years. The evaluations are evidence that some members of the city council,
including Lopez, had been dissatisfied with aspects of Palacios’s performance
for several years. Moreover, because these concerns were raised in Palacios’s
performance evaluations, she was aware of the city council’s concerns and had
the opportunity to address any deficiencies in her performance. In short, this
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is entirely unlike a case in which the reason for termination is vague and
unknown.
Palacios’s response that she should have been permitted to refute the
criticisms of her past performance at the time of her termination is not on
point.

Whether the city councilmembers’ opinions of Palacios’s past

performance were correct is not the proper question. “[T]he ADEA was not
intended to be a vehicle for judicial second-guessing of employment decisions,
nor was it intended to transform the courts into personnel managers.”
Bodenheimer, 5 F.3d at 959; see also Jackson v. Watkins, 619 F.3d 463, 468
(5th Cir. 2010) (noting that “negative interactions” with employee was a
specific enough reason to require showing that it was pretextual). The issue is
not whether the city council’s view that Palacios’s performance was poor was
correct, but only whether it terminated her because of its dissatisfaction with
her performance or because of a discriminatory reason. See Bodenheimer, 5
F.3d at 959.
Palacios next argues that Sendejo and Diaz could not have formed an
opinion of her performance because they were not city councilmembers until
29 days before they terminated her. As the district court observed, “Diaz and
Sendejo both explained how they came to form their respective opinions that
[Palacios] had performed poorly as the City’s manger [sic]. Both men resided
in Crystal City during the time which [Palacios] was the City’s manager and
kept abreast of local issues by reading the newspaper and discussing their
concerns with other officials and residents in the community.” The district
court correctly concluded that, “[this] is a sufficient basis upon which Diaz and
Sendejo could form an opinion as to whether [Palacios] should continue to be
employed as the city manager.”
Palacios also contends that the city council’s failure to follow its city
charter procedures for terminating the city manager is evidence of pretext.
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Failure to follow a policy or procedure may be probative of discriminatory
animus where there is proof that the employee was treated differently than
other employees. See Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337,
346 (5th Cir. 2007) (internal quotation marks omitted). Here, however, the
conduct of the city council provides no indication of a discriminatory motive
regarding the policy deviation. See Martinez v. Tex. Workforce Comm’n–Civil
Rights Div., No. A-11-CA-837, 2014 WL 931425, at *7 (W.D. Tex. Mar. 10,
2014) (citing Machinchick v. PB Power, Inc., 398 F.3d 345, 355 (5th Cir. 2005).
The undisputed record evidence shows that Diaz actually did try to remove
Palacios via a resolution, in accordance with the city charter procedures, but
that this avenue was blocked by then-Mayor Perez.
Palacios next argues that the disparity between her qualifications and
her replacement Gallegos’s qualifications is so vast that the disparity is
evidence of pretext. See Bright v. GB Bioscience. Inc., 305 F. App’x 197, 205
n.8 (5th Cir. 2008) (unpublished). In the first instance, Palacios was actually
replaced by interim city manager John Camarillo, who is also over fifty. Even
assuming arguendo that we should properly compare her qualifications to
Gallegos’s qualifications, she fails to create a genuine issue of material fact on
this point. Lopez testified in his deposition that Palacios herself did not meet
all of the stated qualifications for the job posting when she was hired. Palacios
does not dispute this. The city council’s advertisement for a new city manager
listed several different combinations of education and experience as
qualifications for the city manager position, but also included the catch-all of
“any equivalent combination of experience and training which provides the
required knowledge, skills, and abilities.” When Gallegos was hired he had the
formal education sought in the city council’s advertisement, but lacked
municipal experience.

Lopez testified that “budget-wise . . . we . . .

unfortunately have to . . . settle for sometimes the best applicants that don’t
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meet the criteria.” As the district court explained, there is no evidence that
the other candidates were more qualified, and Gallegos had private-sector
financial experience at a time when the city was facing a budget crisis.
Palacios

next

argues

that

Sendejo’s

deposition

comments

are

circumstantial and direct evidence of discrimination because according to her,
Sendejo testified that he wanted “younger blood” in city management. “Where
a plaintiff offers remarks as circumstantial evidence alongside other alleged
discriminatory conduct . . . a plaintiff [must] show (1) discriminatory animus
(2) on the part of a person that is either primarily responsible for the
challenged employment action or by a person with influence or leverage over
the relevant decision maker.” Reed v. Neopost USA, Inc., 701 F.3d 434, 441
(5th Cir. 2012). To be direct evidence of discrimination, comments must be:
“(1) related to the protected class of persons of which the plaintiff is a member;
(2) proximate in time to the complained-of adverse employment decision; (3)
made by an individual with authority over the employment decision at issue;
and (4) related to the employment decision at issue.” Jackson v. Cal-Western
Packaging Corp., 602 F.3d 374, 380 (5th Cir. 2010) (internal quotation marks
omitted). Contrary to Palacios’s argument, the record does not include any
evidence that Sendejo said that he wanted any “younger blood” managing the
city. Rather, the summary judgment evidence merely shows that constituents
encouraged him to run for city council because they desired younger people in
the city council context. Furthermore, this comment fails to meet other criteria
for establishment of circumstantial or direct evidence of discrimination.
Because Palacios fails to create a genuine issue of material fact as to
whether the city’s legitimate, non-discriminatory reasons for her termination
were pretextual, the district court’s grant of summary judgment on the ADEA
claim was correct.
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B.
Palacios also appeals the district court’s grant of summary judgment on
her Title VII sex discrimination claim. To establish a prima facie case of sex
discrimination, Palacios must show that: “(1) she is a member of a protected
class; (2) she was qualified for the position sought; (3) she was subject to an
adverse employment action; and (4) she was replaced by someone outside her
protected class or was treated less favorably than other similarly situated
employees outside her class.” Haire v. Bd. of Supervisors of La. State Univ.,
719 F.3d 356, 363 (5th Cir. 2013). The McDonnell Douglas burden-shifting
framework applied above is also used to analyze Palacios’s sex discrimination
claim. Johnson v. Louisiana, 351 F.3d 616, 621 (5th Cir. 2003). The parties
assume here, as they did below, that Palacios has stated a prima facie case of
sex discrimination. The burden then shifts to the city to offer a legitimate,
non-discriminatory reason for Palacios’s termination.
The city contends, as it did on the age discrimination claim, that Palacios
was terminated because of her poor work performance and the city council’s
lack of confidence in her ability to manage the city. The evidence supporting
the legitimate, non-discriminatory reasons is the same as discussed above, in
relation to the age discrimination claim. Because the city has satisfied its
burden of offering a legitimate, non-discriminatory reason for Palacios’s
termination, the burden shifts back to Palacios to create a genuine issue of
material fact as to whether the city’s reasons were pretextual.
Palacios offers, with the exception of the “younger blood” comment, the
same arguments about pretext in her sex discrimination claim as she does in
her age discrimination claim. As discussed above, none of her arguments are
sufficient to create a genuine issue of material fact as to whether the city’s
proffered reasons were pretextual.

The district court correctly granted

summary judgment on Palacios’s Title VII sex discrimination claim.
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C.
Palacios also argues that the district court erred when it denied as moot
her motion to strike. This court reviews a district court’s decision on a motion
to strike for abuse of discretion. Cambridge Toxicology Grp., Inc. v. Exnicios,
495 F.3d 169, 178 (5th Cir. 2007).
Palacios does not identify the evidence to which she objects. In the
district court, she moved to strike the declarations of Councilmember Diaz,
Councilmember Sendejo, and Mayor Lopez.

We assume that this is the

evidence to which she objects here. She makes this argument in a single
paragraph and fails to cite any cases in support of the argument.

This

argument is thus forfeited. Fed. R. App. P. 28(a)(8)(A) (requiring appellant’s
brief to contain “appellant’s contentions and the reasons for them, with
citations to the authorities and parts of the record on which appellant relies”);
see also United States v. Valencia, 600 F.3d 389, 432 (5th Cir. 2010) (“We
normally disregard arguments not briefed or raised for the first time at or after
oral argument.”); Craig v. Dall. Area Rapid Transit Auth., 504 F. App’x 328,
333 (5th Cir. 2012) (unpublished) (“the contours of [appellant’s] argument are
vague and not adequately argued in the briefs, so her claim is forfeited”).
Moreover, even assuming arguendo that the claim is not forfeited, the district
court did not rely on the challenged evidence in its analysis.
III.
Because Palacios has not created a genuine issue of material fact as to
whether the city’s legitimate, non-discriminatory reasons for her termination
were pretextual, the district court’s grant of summary judgment is
AFFIRMED.

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