Reed et al v. Navistar Inc.

Filing 37

MEMORANDUM Opinion and Order signed by the Honorable Virginia M. Kendall on 3/31/2016. Defendants' Motion for Summary Judgment 25 is denied. The parties shall appear on April 7, 2016 at 9:00 to set the trial date. Mailed notice.(lk, )

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION
)
James Reed, Jr., and Richard Reed,
)
)
Plaintiffs,
)
No. 14 C 1862
v.
)
)
Judge Virginia M. Kendall
Navistar, Inc.,
)
)
Defendant.
)
)
)
MEMORANDUM OPINION AND ORDER
James Reed, Jr. and Richard Reed filed this action against Navistar, Inc. alleging that
they suffered employment discrimination when they were discharged by Navistar based on their
age in violation of the Age Discrimination in Employment Act of 1967. Navistar now moves for
summary judgment. For the following reasons, the Court denies Navistar’s Motion for Summary
Judgment. (Dkt. No. 25).
I. BACKGROUND
The following facts are undisputed unless otherwise noted. Navistar hired James Reed, Jr.
in 1992 and Richard Reed in 1998. (Def. 56.1, ¶¶ 5, 7; Pl. 56.1 Resp., ¶¶ 5, 7). From 2010 until
his discharge in 2013, James worked as a Senior Analytical Analyst in Navistar’s Warranty
Group. (Def. 56.1, ¶ 8; Pl. 56.1 Resp., ¶ 8). During that same time period, Richard worked as a
Regional Warranty Specialist in the same group as James. (Def. 56.1, ¶ 6; Pl. 56.1 Resp., ¶ 6).
From 2010 to 2012, both Reeds worked at Navistar’s Paramount facility in Warrenville, Illinois.
(Def. 56.1, ¶ 9; Pl. 56.1 Resp., ¶ 9). In January 2012, the Warranty Group—including the
Reeds—moved to Navistar’s current headquarters in Lisle, Illinois. (Def. 56.1, ¶ 11; Pl. 56.1
Resp., ¶ 11).

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The Reeds were assigned cubicles and desktop computers at both the Warrenville and
Lisle facilities. (Def. 56.1, ¶ 9-11; Pl. 56.1 Resp., ¶ 9-11). In December 2012, Ron Johnson, a
member of Navistar’s technology support team performed an audit on the amount of data stored
by employees on their U-drives, which are electronic file storage spaces on Navistar’s computer
network. (Def. 56.1, ¶ 21; Pl. 56.1 Resp., ¶ 21). The audit searched employees’ U-drives for
video and music files and generated a spreadsheet of the results. (Def. 56.1, ¶ 21; Pl. 56.1 Resp.,
¶ 21). The spreadsheet listed the files that were found and the employees’ U-drive identification
number where the files were found. (Id.) In his review of the spreadsheet, Johnson found a video
file named “car wash1.mpg.” (Def. 56.1, ¶ 22; Pl. 56.1 Resp., ¶ 22). The video depicted a naked
woman washing a pickup truck. (Id.) Johnson reported his findings to Mark Hipp, a computer
forensic analyst in Navistar’s IT Department. (Def. 56.1, ¶ 23; Pl. 56.1 Resp., ¶ 23).
Hipp identified the U-drive where the video was found as belonging to Richard Reed and,
with his supervisor’s approval, he began investigating Richard’s network U-drive, computer
hard-drive, and email account for other inappropriate images and videos. (Def. 56.1, ¶ 25; Pl.
56.1 Resp., ¶ 25). Hipp confined his content search to items stored between December 16, 2012
and January 29, 2013. (Def. 56.1, ¶ 26; Pl. 56.1 Resp., ¶ 26). Ultimately, Hipp identified about
72 items containing “inappropriate images.” (Def. 56.1, ¶¶ 27, 31; Pl. 56.1 Resp., ¶¶ 27, 31).
Hipp presented a summary report of his findings to his supervisor, Ryan Johanneson. (Def. 56.1,
¶ 32; Pl. 56.1 Resp., ¶ 32). On January 31, 2013, after reviewing the report, Johanneson
contacted Kay Carroll—Navistar’s Human Resources Director—and informed her of the
investigation’s findings. (Def. 56.1, ¶ 33; Pl. 56.1 Resp., ¶ 33). Carroll directed Shelette Smith—
Navistar’s Senior HR Consultant—to contact Johanneson “because Johanneson and his team
discovered inappropriate images and emails on Richard Reed’s network drive and email

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account.” (See Decl. Smith at ¶ 5; Def. 56.1, ¶ 34; Pl. 56.1 Resp., ¶ 34; see also Dep. Smith at
78-79).
Hipp was then asked by Johanneson to do an extended search and determine whether any
of the Navistar employees to whom Richard had sent inappropriate emails forwarded those
emails to other Navistar employees. (Def. 56.1, ¶ 35; Pl. 56.1 Resp., ¶ 35). Hipp found that
Richard had forwarded the inappropriate emails to 16 Navistar employees. (Def. 56.1, ¶ 36; Pl.
56.1 Resp., ¶ 36). Hipp then collected data from the company email accounts of these sixteen
individuals between 1/1/2010 to 1/31/2013 and searched whether those employees forwarded the
inappropriate emails from Richard. (Def. 56.1, ¶ 37; Pl. 56.1 Resp., ¶ 37). Hipp did not search
whether these individuals sent any other inappropriate emails—he only searched whether the
emails forwarded to them from Richard were then forwarded. (Def. 56.1, ¶ 35; Pl. 56.1 Resp., ¶
35).
On February 5, 2013, Hipp completed his extended search and discovered that ten of the
sixteen employees had forwarded the inappropriate emails from Richard to others. (Def. 56.1, ¶
38; Pl. 56.1 Resp., ¶ 38). He provided that information to Johanneson and the implicated
employees were subsequently disciplined. (Id.) Hipp did not know the ages of the sixteen
employees and he did not know how long Richard or James had worked with the company.
(Def. 56.1, ¶ 39; Pl. 56.1 Resp., ¶ 39).
A. Discipline
The parties dispute the circumstances surrounding the creation and application of the
criteria used to determine discipline for, what the parties agree, were “inappropriate” emails. The
parties cannot even agree on what deponents testified to during their depositions with respect to
this inquiry in spite of having the benefit of transcribed depositions. The parties generally agree

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that Navistar purports to have considered how recently the emails were sent and whether they
were sent internally or externally in determining each employee’s sanction. They dispute,
however, the specific considerations. Smith testified that the emails needed to be sent both
internally and externally within the six months preceding the investigation to precipitate
termination; while sending the emails just internally or just externally would have warranted
only a written warning. (Dep. Smith at 57-59). Johanneson, meanwhile, testified that the emails
needed to be sent internally within the six months preceding the investigation to warrant
termination. (Dep. Johanneson at 125). Ultimately, out of Richard and the nine employees that
forwarded the emails from Richard, two were fired and the rest were given final written
warnings.
B. Termination of Richard Reed
During the six months preceding the investigation, Richard sent six inappropriate emails:
at least three of which were sent to Navistar email addresses. (Def. 56.1, ¶ 49; Pl. 56.1 Resp., ¶
49). Ultimately, Smith and Carroll agreed that Richard should be terminated. (Def. 56.1, ¶ 53; Pl.
56.1 Resp., ¶ 53). Johanneson did not recall making a recommendation as to whether Richard
should be terminated. (See Def. 56.1, ¶ 53; Pl. 56.1 Resp., ¶ 53). Smith and Carroll testified that
they did not know how old Richard was when he was fired. (Def. 56.1, ¶ 54; Pl. 56.1 Resp., ¶
54). Smith, however, knew that that Richard was a long-term employee of Navistar. (Id.) She
also knew that his age would have been available in his human resources file. (Def. 56.1, ¶ 39;
Pl. 56.1 Resp., ¶ 39). According to Richard, he had “seen Carroll at work from time to time
during the last year of his employment.” (See Pl. 56.1 Resp., ¶ 54). Richard was 61 years old
when he was terminated. (Def. 56.1, ¶ 62; Pl. 56.1 Resp., ¶ 62).

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C. Termination of James Reed
From January 2010 to January 2013, James forwarded eight emails containing images of
nude and semi-nude women from his Navistar email account. (Def. 56.1, ¶ 55; Pl. 56.1 Resp., ¶
55). James conceded during his deposition that all of the images were inappropriate workplace
communications. (Def. 56.1, ¶ 57; Pl. 56.1 Resp., ¶ 57). The parties dispute, however, why
James was terminated. Navistar maintains that Smith, Johanneson, and Carroll decided to
terminate James because he had forwarded an inappropriate email to Richard within the six
months preceding the investigation, while James insists that he did not forward an inappropriate
email to Richard in the six months before the investigation. (Def. 56.1, ¶ 60; Pl. 56.1 Resp., ¶
60). Whatever the reason, James was terminated at the age of 69. (Def. 56.1, ¶ 62; Pl. 56.1 Resp.,
¶ 62). Smith and Carroll testified that they did not know how old James was when he was
terminated. (Def. 56.1, ¶ 54; Pl. 56.1 Resp., ¶ 54). Smith, however, knew that James was a longterm employee of Navistar. (Def. 56.1, ¶ 61; Pl. 56.1 Resp., ¶ 61). She also knew that his age
would have been available in his human resources file. (Id.)
D. Discipline of Other Employees
Of the eight other employees who were found to have forwarded inappropriate emails,
there were four employees over the age of 40. (Def. 56.1, ¶ 62; Pl. 56.1 Resp., ¶ 62). Those
employees were given final warnings either because they had sent the subject emails outside the
six months preceding the investigation or had sent them only to personal email addresses. (Def.
56.1, ¶¶ 62-67; Pl. 56.1 Resp., ¶¶ 62-67). The four employees under the age of forty were also
given a final warning for similar reasons. (Def. 56.1, ¶¶ 68-72; Pl. 56.1 Resp., ¶¶ 68-72).

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E. The Reeds’ Discrimination Charges with the EEOC
After Navistar terminated the Reeds’ employment, the Reeds filed age discrimination
charges with the Illinois Department of Human Rights, which they also cross-filed with the
Equal Employment Opportunity Commission. (See Compl. ¶ 6). The Reeds claimed that Navistar
discharged them because of their age. (Id.) Specifically, Navistar’s position paper to the EEOC,
Navistar stated that “Richard Reed and Jim Reed were the only employees who had actually sent
the inappropriate emails to co-workers and other recipients from their Company-owned
computers. The other employees had deleted the emails they received and had not originated any
emails with inappropriate content.” (Pl. 56.1, ¶ 27; Def. 56.1 Resp., ¶ 27). The EEOC issued
Dismissal and Notice of Rights letters around December 24, 2013. (See Compl. ¶ 6). The Reeds
allege—and Navistar does not dispute—that they timely filed this suit within 90 days of
receiving their respective EEOC letters. See 42 U.S.C. § 2000e-5(f)(1).
II. STANDARD OF REVIEW
“The court shall grant summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R.
Civ. P. 56(a). “A factual dispute is ‘genuine’ only if a reasonable jury could find for either
party.” Nichols v. Mich. City Plant Planning Dep’t, 755 F.3d 594, 599 (7th Cir. 2014) (internal
quotation marks and citation omitted). Because the Reeds bears the ultimate burden of
persuasion, Navistar’s summary judgment burden “may be discharged by ‘showing’—that is,
pointing out to the district court—that there is an absence of evidence to support [the Reeds’]
case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986); see also Andrews v. CBOCS W., Inc.,
743 F.3d 230, 234 (7th Cir. 2014). “Upon such a showing, the nonmovant must then ‘make a
showing sufficient to establish the existence of an element essential to that party's case.’ ”

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Modrowski v. Pigatto, 712 F.3d 1166, 1168 (7th Cir. 2013) (quoting Celotex, 477 U.S. at 322).
Although the nonmovant does not need to “depose her own witnesses or produce evidence in a
form that would be admissible at trial,” she must “go beyond the pleadings…to demonstrate that
there is evidence upon which a jury could properly proceed to find a verdict in her favor.” Id. at
1168-69 (internal quotation marks and citation omitted).
III. DISCUSSION
Employment discrimination claims brought under the ADEA may be proven using either
the “direct” or “indirect” methods of proof. Ripberger v. Corizon, Inc., 773 F.3d 871, 876 (7th
Cir. 2014); Andrews, 743 F.3d at 234. The distinction between the two methods, however, is
“vague.” Sylvester v. SOS Children's Villages Ill., Inc., 453 F.3d 900, 903 (7th Cir. 2006).
Indeed, the terms are somewhat “misleading.” See Hemsworth v. Quotesmith.Com, Inc., 476 F.3d
487, 490 (7th Cir. 2007). “Direct” proof is not limited to admissions or near-admissions by the
employer that its decisions were based on age, but it also includes circumstantial evidence that
suggests discrimination. See id. The “indirect” method of proof involves a “subset of
circumstantial evidence (including the disparate treatment of similarly situated employees) that
conforms to the prescription of McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S.Ct.
1817, 36 L.Ed.2d 668 (1973).” Id. at 490-491. The Reeds purport to be proceeding under both
theories

A. Direct Method of Proof

Under the direct method of proof, the Court notes that there has been no admission by
Navistar that it terminated the Reeds because of their age. The Court, therefore, must consider
whether the Reeds have provided sufficient circumstantial evidence in the record to demonstrate
a genuine issue of material fact. Circumstantial evidence of intentional discrimination includes:
“(1) suspicious timing, ambiguous oral or written statements, or behavior toward or comments

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directed at other employees in the protected group; (2) evidence, whether or not rigorously
statistical, that similarly situated employees outside the protected class received systematically
better treatment; and (3) evidence that the employee was qualified for the job in question but was
passed over in favor of a person outside the protected class and the employer's reason is a pretext
for discrimination.” Sun v. Bd. of Trs. of Univ. of Ill., 2007 WL 93313, at *12 (7th Cir. Jan. 16,
2007); see, e.g., Rudin v. Lincoln Land Cmty. Coll., 420 F.3d 712, 720-21 (7th Cir. 2005). The
circumstantial evidence offered by the Reeds in this case is that younger employees were given
preferential treatment over them and that Navistar’s stated legitimate reason for terminating them
was mere pretext. Specifically, the Reeds claim that eight employees who were younger than
they and engaged in similar misconduct were merely given a final warning for their misconduct
instead of being discharged:
Age
32
37
38
38
48
48
54
58

Name
McLaughlin
Jamros
Olejniczak
Bala
Graybeal
Krason
Gall
Cloke

In support of their argument, the Reeds point to conflicting evidence of the criteria used
in determining each employee’s sanction. For example, Smith testified that in order to be fired,
the employee must have sent the emails both internally and externally within the preceding six
months of the investigation to precipitate termination; while employees who sent emails just
internally or just externally would have warranted only a written warning. Johanneson, on the
other hand, testified that an employee who sent emails internally within 60 days of the
investigation warranted termination. A third method of reasoning and a wholly-distinct account

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of the facts was set forth in Navistar’s position paper to the EEOC, in which Navistar stated that
“Richard Reed and Jim Reed were the only employees who had actually sent the inappropriate
emails to co-workers and other recipients from their Company-owned computers. The other
employees had deleted the emails they received and had not originated any emails with
inappropriate content.” These disparities make it impossible for the Court—which is not the
finder of fact at this stage—to determine whether the legitimate reason Navistar claims to have
had in discharging the Reeds is mere pretext.
Even assuming the termination criterion set forth in Navistar’s briefing was actually
applied—namely, that only employees who sent an inappropriate email to an internal email
address within the six months preceding the investigation were terminated—there remain other
fact disputes in the record. First, these criteria set a much stricter standard of review for Richard
Reed than for the other implicated employees. Navistar relied on an investigation of all of
Richard’s outgoing emails, while it only relied on an investigation of emails forwarded by the
other employees from Richard in evaluating their conduct. Second, James disputes that he sent
an email from his company email account to Richard within the six months preceding the
investigation and that appears to be corroborated by the email exhibits to his deposition. Exhibit
Number 33 from Richard’s deposition shows an inappropriate email from a “jim reed”
([e-mail]) to Richard within six months preceding the investigation, but there is no
evidence that that “jim reed” is the plaintiff in this case and, even if it were, the email was sent
from a personal email account. On this record, it cannot be determined if the criteria was applied
similarly to those who were discharged and those who were merely disciplined.
B. Indirect Method of Proof

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Under the indirect method of proof, a plaintiff must set forth by a preponderance of the
evidence that (1) they are members of a protected age class; (2) they met Navistar's legitimate
employment expectations; (3) they suffered an adverse employment action; and (4) similarlysituated employees outside of their protected class were treated more favorably. Arizanovska v.
Wal-Mart Stores, Inc., 682 F.3d 698, 702 (7th Cir. 2012). Generally, if the plaintiff “makes this
prima facie case, the burden shifts to the defendants to articulate a legitimate, nondiscriminatory
reason for its action. If the defendant does so, the burden shifts back to the plaintiff, who must
present evidence that the stated reason is pretext for discrimination.” Adams v. City of
Indianapolis, 742 F.3d 720, 735 (7th Cir. 2014); see also Tomanovich v. City of Indianapolis,
457 F.3d 656, 663 (7th Cir. 2006) (quoting Adusumilli v. City of Chicago, 164 F.3d 353, 362 (7th
Cir.1998)).
Navistar argues that the Reeds cannot satisfy the second and fourth elements of their
prima facie case. Because these arguments on whether the Reeds met Navistar’s legitimate
employment expectations and whether “similarly-situated” employees were treated more
favorably than the Reeds are both tied to the Reeds’ pretext theory, the Court considers the
arguments together. See Curry v. Menard, Inc., 270 F.3d 473, 478 (7th Cir. 2001) (it makes no
sense to evaluate whether the plaintiff is meeting "legitimate expectations" when she admits to
violating company policies but is alleging she was punished more harshly than non-black
employees who also violated the policy); see also Adams, 742 F.3d at 735 (observing that the
fourth element of the prima facie case often merges with the question of pretext); Box v. A & P
Tea Co., 772 F.2d 1372, 1378 (7th Cir. 1985) (moving directly to third step of McDonnell
Douglas approach where defendant provided proof of a legitimate, nondiscriminatory reason for
adverse employment action).

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To avoid summary judgment, the Reeds must show by a preponderance of the evidence
that Navistar’s proffered reason for terminating their employment is pretextual. Sublett v. John
Wiley & Sons, Inc., 463 F.3d 731, 737 (7th Cir. 2006).  To establish a genuine issue of material
fact regarding pretext, the plaintiff “must show that ‘1) it is more likely a discriminatory reason
motivated the employer than the proffered non-discriminatory reason or 2) that an employer's
explanation is not credible.’ ” Id. (quoting Hudson, 375 F.3d at 561). The plaintiff must
“specifically refute facts which allegedly support the employer's proffered reasons.” Mills v.
First Fed. Sav. & Loan Ass'n, 83 F.3d 833, 845 (7th Cir. 1996) (citation omitted) (emphasis
omitted). Conclusory assertions about a decision maker’s prejudice are insufficient to establish
pretext. Wells v. Unisource Worldwide, Inc., 289 F.3d 1001, 1007 (7th Cir. 2002).
Navistar claims a legitimate, non-discriminatory reason for discharging the Reeds while
merely issuing a warning to the eight other employees; namely, that the Reeds’ conduct was
more egregious than the other, younger employees based on Navistar’s defined criteria. To
demonstrate pretext, the Reeds once again dispute the criteria and the application of the criteria
used by Navistar in making its disciplinary decisions. Because fact disputes remain regarding
whether the criteria was applied in the same manner to plaintiffs and to others, the Court cannot
make a determination at this stage that as to whether the firing was pretextual.Summary
judgment is inappropriate where factual disputes remain regarding how the criteria was applied,
what the criteria was, and who enforced the criteria.. See Greengrass v. Int’l Monetary Sys. Ltd.,
776 F.3d 481, 487 (7th Cir. 2015) (quoting Coleman v. Donahoe, 667 F.3d 835, 852-53 (7th Cir.
2012) (“Pretext can be shown by ‘identif[ying] … weaknesses, implausibilities, inconsistencies,
or contradictions’ in an employer’s asserted reason for taking an adverse employment action
such ‘that a reasonable person could find [it] unworthy of credence.”) (alterations in original)).

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Navistar attempts to circumvent the pretext issue by insisting that the slight three and
seven-year age differential between Richard and two of the employees that were provided mere
warnings for their misconduct undercuts the Reeds’ prima facie case of discrimination. Yes, in
general, when the plaintiff and those allegedly favored over him are within the same protected
class, “the prima facie case under the ADEA require[s] a sufficient disparity in ages.” See
Bennington v. Caterpillar, Inc., 275 F.3d 654, 659 (7th Cir. 2001) (internal quotation marks and
citation omitted). A ten-year difference in ages between the plaintiff and the favored parties
presumptively “substantial,” while five or seven-year differences may be insignificant to set
forth a prima facie age discrimination case in and of itself. See Faas v. Sears, Roebuck & Co.,
532 F.3d 633, 643 (7th Cir. 2008) (three-year age difference not significant); Bennington, 275
F.3d at 659 (finding five-year age difference insufficient by itself to establish prima facie age
discrimination case).
In this case, however, the age differential between Richard and those two individuals is
not the only piece of evidence relied upon by the Reeds in establishing their prima facie case.
There were not just two, but eight other individuals who were given warnings instead of being
terminated. And, out of a group of ten individuals, only the two oldest individuals were
discharged. Moreover, some of the representations made to the EEOC regarding the disciplinary
policies followed by Navistar are inconsistent with the story now before this Court. There are
simply too many disparities for the Court to resolve this case as a matter of law.
Finally, Navistar’s claim that its employees did not know how old the Plaintiffs were at
the time they were discharged is also disputed by the facts. Smith, Carroll, and Johanneson knew
testified that they did not know the exact ages of the Reedswhen they decided to terminate them;
however, there is evidence in the record that knew both Reeds were long-term employees of

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Navistar; that their ages were in their human resources files; she was able to access those files;
and that she had seen at least one of them in the hallways from time to time. Although there is a
factual dispute here also and the law generally supports the inference that most employers have
knowledge of age of their employees. See, e.g., Diaz v. Eagle Produce Ltd. Partnership, 521
F.3d 1201, 12010 (9th Cir. 2008) (finding on-the-job contact was sufficient to warrant an
inference of the employer’s knowledge of age); Woodman v. WWOR TV, Inc., 411 F.3d 69 (2d
Cir. 2005) (“In the majority of age discrimination cases, a defendant employer's knowledge of a
plaintiff's age will be undisputed because employers routinely maintain employee age
information in their personnel files or are generally aware of employees' relative ages from
personal on-the-job contact. Such circumstances easily support an inference of employer
knowledge, certainly at the prima facie stage, where plaintiff's burden is minimal.”).
Although Navistar may have terminated its employees for breaching their company
policy regarding the use of their work computers rather than due to their age, there remain too
many fact disputes to make that determination. A jury will need to decide that issue. Navistar’s
motion for summary judgment is denied.
CONCLUSION
For the foregoing reasons, the Defendants’ Motion for Summary Judgment [25] is denied.

________________________________________
Virginia M. Kendall
United States District Court Judge
Northern District of Illinois
Date: ___3/31/2016_

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