IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT ___________________________________ Nos. 02-20516, 20517, 20518 & 20519 ___________________________________ CAROL FRANK, IRIS DEBOSE, HENRIETTA WILLIAMS, and SIBYL ARTERBERRY, Plaintiffs-Appellants, v. XEROX CORPORATION, Defendant-Appellee. _______________________________________________ On Appeal from the United States District Court for the Southern District of Texas ________________________________________________ BRIEF OF AMICUS CURIAE THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION IN SUPPORT OF PLAINTIFFS AND IN FAVOR OF REVERSAL __________________________________________________ NICHOLAS M. INZEO Acting Deputy General Counsel PHILIP B. SKLOVER Associate General Counsel VINCENT J. BLACKWOOD Assistant General Counsel BARBARA L. SLOAN Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 1801 L Street, N.W., Room 7014 Washington, D.C. 20507 (202) 663-4721 TABLE OF CONTENTS TABLE OF CONTENTS i TABLE OF AUTHORITIES ii STATEMENT OF INTEREST 1 STATEMENT OF THE ISSUES 2 STATEMENT OF THE CASE 1. Nature of the Case and Course of Proceedings 2 2. Statement of Facts 3 3. Decisions Below 12 STATEMENT OF STANDARD OF REVIEW 13 ARGUMENT TAKING ACCOUNT OF THE EVIDENCE CONCERNING THE IMPLEMENTATION OF THE BALANCED WORKFORCE INITIATIVE AT XEROX'S HOUSTON CENTER, THERE IS SUFFICIENT EVIDENCE TO SUPPORT A FINDING THAT THE PLAINTIFFS WERE DENIED EMPLOYMENT OPPORTUNITIES BECAUSE OF THEIR RACE. 13 CONCLUSION 29 CERTIFICATE OF COMPLIANCE 30 CERTIFICATE OF SERVICE TABLE OF AUTHORITIES CASES Page(s) Bass v. Board of County Commissioners, 256 F.3d 1095 (11th Cir. 2001) 17-18, 22-23 Blow v. City of San Antonio, 236 F.3d 293 (5th Cir. 2001) 13, 15 Brown v. East Mississippi Electric Power Association, 989 F.2d 858 (5th Cir. 1993) 16 Brown v. McLean, 159 F.3d 898 (4th Cir. 1998) 24-25 Celestine v. Petroleos de Venezuela, 266 F.3d 343 (5th Cir. 2001) 27 Cerrato v. San Francisco Community College, 26 F.3d 968 (9th Cir. 1994) 24 Furnco Construction Co. v. Waters, 438 U.S. 567 (1978) 15 Goodman v. Lukens Steel Co., 482 U.S. 656 (1987) 19 International Union, UAW v. Johnson Controls, 499 U.S. 187 (1991) 19 LaPierre v. Benson Nissan, 86 F.3d 444 (5th Cir. 1996) 16 Messer v. Meno, 130 F.3d 130 (5th Cir. 1997) 13, 18, 25, 26 National R.R. Passenger Corp. v. Morgan, 122 S. Ct. 2061 (2002) 22 Odom v. Frank, 3 F.3d 839 (4th Cir. 1993) 27 Portis v. First National Bank of New Albany, 34 F.3d 325 (5th Cir. 1994) 17 Price Waterhouse v. Hopkins, 490 U.S. 228 (1989) 16-17 Reeves v. Sanderson Plumbing Products, 530 U.S. 133 (2000) 15, 16 Rutherford v. Harris County, 197 F.3d 173 (5th Cir. 1999) 28 Scales v. Slater, 181 F.3d 703 (5th Cir. 1999) 17 United Steelworkers v. Weber, 443 U.S. 193 (1979) 1, 14 Vance v. Union Planters Corp., 209 F.3d 438 (5th Cir. 2000) 22, 28 Whalen v. Rubin, 91 F.3d 1041 (7th Cir. 1996) 23, 24, 26 White v. Federal Express Corp., 939 F.2d 157 (4th Cir. 1991) 17 STATUTES AND RULES 42 U.S.C. § 1981 2, 16 Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq. 1 42 U.S.C. § 2000e-2(m) 17 Federal Rule of Civil Procedure 56 13 Federal Rule of Evidence 403 25 IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT ___________________________________ Nos. 02-20516, 20517, 20518 & 20519 ___________________________________ CAROL FRANK, IRIS DEBOSE, HENRIETTA WILLIAMS, and SIBYL ARTERBERRY, Plaintiffs-Appellants, v. XEROX CORPORATION, Defendant-Appellee. _______________________________________________ On Appeal from the United States District Court for the Southern District of Texas ________________________________________________ BRIEF OF AMICUS CURIAE THE EQUAL EMPLOYMENT OPPORTUNITY COMMISSION IN SUPPORT OF PLAINTIFFS AND IN FAVOR OF REVERSAL ________________________________________________ STATEMENT OF INTEREST The Equal Employment Opportunity Commission is the agency designated by Congress to interpret and enforce Title VII of the Civil Rights Act of 1964, 42 U.S.C. §§ 2000e et seq. (“Title VII”), and other federal employment discrimination laws. This appeal raises important questions of proof in race discrimination cases. Plaintiffs proffered substantial evidence that Xerox, having concluded under its Balanced Workforce Initiative that the Houston Center had too many black employees, made race-conscious employment decisions that limited the employment opportunities of African-Americans including plaintiffs throughout the 1990s. Xerox made no attempt to show that such a practice was valid under United Steelworkers v. Weber, 443 U.S. 193 (1979). Nevertheless, the district court essentially ignored the evidence of race-conscious decisionmaking in granting summary judgment to Xerox. Indeed, despite the evidence, the court required a plaintiff to show that she was “clearly better qualified” for a particular promotion. We believe the court's errors may have resulted, at least in part, from uncertainty as to how to treat such evidence in ruling on a summary judgment motion. We therefore offer our views to this Court. STATEMENT OF ISSUES 1. Whether the district court erred in discounting evidence of Xerox's Balanced Workforce Initiative which, if believed, is sufficient to establish that race was a motivating factor in the employment decisions at issue. 2. Whether, to raise a material issue of fact as to pretext in a race discrimination suit, a plaintiff must show that she was “clearly better qualified” for a particular position where there is other evidence of race-conscious decisionmaking. STATEMENT OF THE CASE 1. Nature of the Case and Course of Proceedings These are appeals from final judgments dismissing the race discrimination claims of six former or current employees of defendant. Plaintiffs brought a single suit under Title VII and 42 U.S.C. § 1981 on June 29, 2000, alleging inter alia that, because they are black, defendant denied them promotions and pay increases and forced them to work in a racially hostile work environment. District court docket number (“R”)1; R36 (First Amended Complaint). In January 2002, defendant filed a separate motion for summary judgment with respect to each plaintiff. R59, R61, R63, R65, R67, R69. On February 28, 2002, in separate orders, the district court granted defendant's motions, dismissed plaintiffs' claims, and ordered entry of judgment. R103-R109. On March 14 and April 2, 2002, the court denied plaintiffs' motions for reconsideration. R124, R129. Plaintiffs filed timely notices of appeal on April 12 (R134-R135 (Horn, Walker)) and May 2, 2002 (R139-R142 (Frank, DeBose, Williams, Arterberry)). 2. Statement of Facts During the 1990s Xerox Corporation had in place a program called the Balanced Workforce (“BWF”) Initiative. According to Xerox's 1999 BWF Reference Guide, “Balanced Workforce is a strategy within [the company's] corporate mission designed to ensure all employee groups (minorities, majorities, males and females) be proportionately represented in all functions and at all levels.” Arterberry Summary Judgment Response (“SJR”), Tab1 at 3. The Guide explains that “BWF goals are established for each organization on an annual basis” based on government labor force data, and “BWF Performance Reports are distributed to organization managers for their review throughout the year.” Id. at 6. The Guide further explains that BWF is used “to determine our progress in achieving a balanced workforce and as a measurement to hold managers accountable for developing their people and giving them opportunities for upward mobility.” Id. An “opportunity” is defined as “a personnel transaction that moves an individual into a new job category (i.e., Sales) or grade level (i.e., 7+, 10+, . . .).” Id. at 7-8. Management is urged to use promotion, transfer and other hiring decisions as “opportunities” to reach BWF racial and gender goals. According to the Guide, “Opportunities represent the means to achieve Balanced Workforce goals. If opportunities are not used to move representation in the right direction, the Balanced Workforce goals will not be achieved.” Id. at 7. During this period, pursuant to the BWF Initiative, Xerox regularly produced reports listing the actual and desired racial and gender composition of each office. See, e.g., Arterberry SJR, Tab3. According to then-Houston Controller Doug Jean, these reports indicated that, in Xerox's Houston Center, African-Americans were overrepresented in the workforce, compared to their representation in the local population. Whites, in contrast, were considered to be underrepresented. See, e.g., Frank's SJR, Ex10 (Jean Dep. 46-47, 97-99). In 1991, Doug Durham transferred into the Houston Center as general manager; he remained in that position until 1999. Frank's SJR, Ex18 (Durham Dep. 21, 58). Finding a disproportionate number of black and white employees, he directed that the Center begin producing its own BWF “Summary” reports which set explicit racial goals for each job and grade-level category and identified the number by which each race was over- or underrepresented in that category. See Frank's SJR, Ex10 (Jean Dep. 34-36). By way of illustration, the September 30, 1998, report contains the following goals for the Houston Center as a whole and for particular job and grade-level categories: BWF Goal Current Actual Over/Under % # % # [represented] Houston Center Black 15% 26 33% 57 31 Asian 3% 5 8% 14 9 Native American 3% 5 1% 2 -3 Hispanic 18% 32 14% 25 -7 White 62% 110 44% 76 -34 Production Black 17% 21 35% 44 23 Asian 3% 4 8% 10 6 Native American 1% 1 2% 2 1 Hispanic 22% 28 17% 21 -7 White 57% 71 38% 47 -24 Sales Black 8% 1 20% 2 1 Asian 3% 0 20% 2 2 Hispanic 8% 1 0% 0 -1 White 81% 8 60% 6 -2 Finance & Operations Support Black 18% 1 29% 2 1 Asian 2% 0 0% 0 0 Hispanic 15% 1 29% 2 1 White 65% 5 43% 3 -2 BWF Goal Current Actual Over/Under % # % # [represented] Exempt (Non-Sales 10+) Black 10% 1 20% 2 1 Asian 2% 0 20% 2 2 Hispanic 7% 1 10% 1 0 White 81% 8 50% 5 -3 Exempt (Non-Sales 7-9) Black 13% 0 33% 1 1 Asian 2% 0 0% 0 0 Hispanic 7% 0 0% 0 0 White 78% 2 67% 2 0 Exempt (Non-Sales 1-6) Black 8% 2 30% 6 4 Asian 3% 1 0% 0 -1 Hispanic 7% 1 5% 1 0 White 82% 16 65% 13 -3 Arterberry SJR, Tab4 at 2669-2670; see also id. at 2671-2676 (1994, 1997 summaries).<1> Once the reports were generated, Durham went over them in senior staff meetings and “urged” his managers “to hire to meet those targets.” Frank's SJR, Ex10 (Jean Dep. 92); id. at 38-42 (“targets” and “actuals” were discussed at staff meetings from standpoint of how many people should be hired and what their ethnic makeup should be to “meet the target”). Staff meeting notes from the late 1990s, for example, report “opportunities” for “majorities” or “majorities and hispanics.” See, e.g., Arterberry SJR, Tab5 at 2666 (“majority male and majority female -- we have not made progress”); Frank's SJR, Ex49 (“majorities and hispanics,” adding that extraneous people should be removed from “our headcount so they will not skew our BWF numbers”). They do not mention opportunities for African-Americans. Most of these discussions concerned Production or Operations people -- “you could impact [those areas] the most” since there was more hiring and turnover. Jean Dep. 47-48 (adding that exempt and professional positions were “looked at less” as there were fewer such jobs, “very little turnover and very little opportunity to impact those”). Managers were told to “bring in more white male[s] and white female[s]” since “those were the categories that were underrepresented.” See id. at 42-43. The need to use “opportunities” to bring in white employees was also pointed out in Houston's Human Resource Management (“HRM”) Plan. In 1996, for example, the HRM Plan stated that the “opportunity exists for improvement in hiring qualified majority males and majority females in Sales, Production and Administration departments,” adding that the “responsibility for achieving a balanced work force lies with every member of the Houston Management Team. The Staffing and Development Manager is tasked with sourcing qualified applicants with the emphasis on achieving our Balanced Work Force targets.” Arterberry SJR, Tab2 at 2679. Managers' evaluations reflected how well they “followed” and “adhered” to the “adamant” BWF “targets in relation to intake of personnel.” See, e.g., Arterberry SJR, Tab6 at 2654 (Olivarez); 2657 (Carter). Similarly, Sales Manager Amos Benning testified that his success in meeting the BWF goals could impact his performance appraisal -- assuming he had hiring “opportunities,” he could be “penalized” for not using those opportunities to balance his staff. Frank's SJR, Ex47 (Benning Dep. 66-67). Benning explained that, as a manager, he considered himself “obligated to make sure [he] had a Balanced Workforce.” Id. at 66. Thus, if the BWF reports indicated that his section was “out of compliance” in that he “needed a majority male, minority female, whatever the case may be,” he “would try to find a candidate that was qualified and met that profile.” Id. at 58-59 (also agreeing that “under/minus number” in report told him who he needed to hire). When Doug Jean, one of those responsible for generating the BWF summaries, commented to a Region HR Manager that it was unfair to discriminate against a particular EEO category “to meet numbers,” he was told it was “the corporate direction.” Frank's SJR, Ex10 (Jean Dep. 99). Xerox denied, however, that it “balance[d] its workforce or reach[ed] affirmative action goals” by “involuntarily discharging” black employees. Xerox's Motion for Summary Judgment (“XMSJ”) for Frank's claims, Tab13 (Durham Aff. ¶ 6); Tab7 (Buchanan Decl. ¶ 4). Jean explained the company did not “necessarily” target blacks for termination; while that would be one way to reach BWF goals, “it's hard to terminate someone based on . . . their EEO category . . . [y]ou would have to come up with another reason.” Frank's SJR, Ex10 (Jean Dep. 42-44). At some point, lower-level employees became aware of both the objectives of the BWF Initiative and the specific racial targets. Jean testified, for example, that Durham had him brief employees on the program -- to “show[] them the statistics in terms of what the targets were and what the actuals were” and explain “that because of affirmative action we would be trying to hire to these particular targets.” Jean Dep. 102. In 1997, a number of African-American employees, including plaintiffs, complained that they were not being treated fairly. In response, Durham and Region Human Resources Manager Lloyd Buchanan held “Minority Roundtables” where interested employees could air their grievances. R105, Order granting summary judgment in Frank's case (“Order”) at 4-5; see also XMSJ-Frank, Tab7 (Buchanan Decl. ¶¶ 2-4) (explained BWF in 1997 Minority Roundtable meetings). The Roundtables produced no concrete improvements, however, and participants later perceived that Xerox held their participation against them in making employment decisions. See, e.g., Frank's SJR, Ex1 (Frank's Decl. ¶ 33). Plaintiffs here all worked in non-exempt or lower-level (Grade 1-6) exempt (non-sales) positions in the Houston Center. Carol Frank's experiences illustrate the employees' concerns. Hired as a Grade 4 in 1985, with a master's degree and five years of management experience (Frank's SJR, Ex1), Frank received good evaluations and regular promotions until the early 1990s at which point she was an exempt (non-sales) Grade 6, Customer Account Manager (“CAM”). XMSJ-Frank, Tab2; Frank's SJR Ex3-7; see generally Order at 2. The BWF-related materials indicate that promotion to Grade 7 or above would be considered an “opportunity” that would have to be counted for BWF purposes. Arterberry SJR, Tab1 at 7. Frank never received such a promotion even though she continued to receive awards and good performance appraisals. See, e.g., XMJS-Frank, Tab1 (Carter Decl. ¶ 3); Frank's SJR, Ex43 (Carter Dep. 83-84) (“hard worker”; “did a great job”; “I respected her work”). Eventually, she surpassed the mid-point for her salary grade and stopped receiving merit raises. XMSJ-Frank, Tab1 (Carter Decl. ¶ 5). In 1997, a job she wanted, Customer First Manager, was given to a white employee without posting; when that employee left a few weeks later, Frank and three other employees including plaintiff Cynthia Walker applied. After their interviews, however, Durham announced that he had decided not to fill the slot. Frank's SJR, Ex1; Order at 5-7. Later that year, Frank applied for and got the job of DMSI Coordinator (Grades 4-7). Although she asked that it be classified as Grade 7, it was classified as Grade 6 and, accordingly, her new job was treated as a lateral move. Frank's SJR, Ex1; Order at 5. Finally, in 1998, Frank applied for a position as Manager of Customer Operations (“MCO”); after an interview, Frank was denied the job and was told that she would not be eligible for such promotion for approximately three more years. Frank's SJR, Ex34. As the 1998 BWF Summary reflects, the target for African-Americans in exempt (non-sales) jobs was 0 for Grades 7-9 and 1 for Grades 10+; African-Americans were already “overrepresented” (by 1) in each category. See supra at 6 (Arterberry SJR, Tab4 at 2670). The successful candidate for the MCO position was a Hispanic male named Joe Olivarez. Order at 5-6; XSJM-Frank, Tab3 (Olivarez Aff.); cf. Frank's SJR, Ex10 (Jean Dep. 75) (Durham said he “needed a Hispanic senior staff”). In early 1999, Frank heard the company was planning to create a Grade 7-9 DMSI Project Manager position, which seemed a good fit for her since she was a DMSI Coordinator. She also heard, however, that a white male employee was being groomed for the job. Despite questioning, Frank's boss would not or could not tell her when or even whether the position would be created. Order at 6. Frustrated, Frank resigned and, in late December, filed a charge of discrimination. See id.; cf. Frank SJR, Ex11 (Moses Dep. 21)(heard Frank's supervisor say “she had done a good job and . . . finally gotten rid of Carol Frank”). Frank and five other plaintiffs filed suit in June 2000. They allege: that they were denied promotions and pay raises and/or were demoted, terminated or constructively discharged because of their race; that they were subjected to a racially hostile work environment, based largely on the BWF Initiative and what they viewed as managers' efforts to force them to quit to achieve BWF targets; and that they were retaliated against due to their participation in the Minority Roundtable. R1. Xerox filed separate motions for summary judgment as to each plaintiff. In general, the company argued that the bulk of the challenged employment decisions were outside the limitations period and that plaintiffs could not show they had been discriminated against on the basis of race. As for the BWF, the company took the position that the plaintiffs had not shown it affected their employment. 3. Decisions Below In separate opinions, the district court granted summary judgment on each plaintiff's claims. The court initially agreed with Xerox that most of the claims were untimely and, on that basis, did not consider the evidence with respect to those employment decisions for any purpose. See, e.g., R103 (Williams Order at 8) (dismissing pre-1999 claims and considering only “remaining” ones). The remaining claims were dismissed for lack of evidence. In so doing, the court also gave short shrift to the BWF-related materials, essentially treating them as irrelevant for any purpose. See, e.g., id. at 15 (mentioning BWF only in describing disparate impact claim). Regarding Carol Frank, the court held that all of her promotion claims were untimely under Title VII. However, the court held that the final one -- relating to the 1998 MCO position -- was timely under § 1981. Order at 11-13. As to that decision, the court concluded that Frank made out a prima facie case under McDonnell Douglas; Xerox's proffered explanation for the decision – it chose the successful candidate, Joe Olivarez, because he was better qualified – satisfied the company's burden; and Frank did not show the reason was pretextual. Id. at 15-17. According to the court, Frank failed to raise a genuine issue of material fact as to pretext because she presented insufficient evidence that she was “clearly better qualified” than Olivarez. Id. at 17. As for the BWF-related information, the court stated that Frank “failed to provide any connection between Xerox's implementation of the BWF in 1988-1990 and Frank's failure to receive the MCO job in 1998,” and there was no evidence the BWF “played any role” in the selection process. Id. at 16. STATEMENT OF STANDARD OF REVIEW This Court reviews the grant of summary judgment de novo. Messer v. Meno, 130 F.3d 130, 134 (5th Cir. 1997). In so doing, the Court reviews the record as a whole, “view[ing] all facts in the light most favorable to the non-moving party” and “do[es] not defer to any factual assumptions the district court has apparently made.” Blow v. City of San Antonio, 236 F.3d 293, 296 (5th Cir. 2001); Fed. R. Civ. P. 56. ARGUMENT TAKING ACCOUNT OF THE EVIDENCE CONCERNING THE IMPLEMENTATION OF THE BALANCED WORKFORCE INITIATIVE AT XEROX'S HOUSTON CENTER, THERE IS SUFFICIENT EVIDENCE TO SUPPORT A FINDING THAT THE PLAINTIFFS WERE DENIED EMPLOYMENT OPPORTUNITIES BECAUSE OF THEIR RACE. The central question in this case, as in most discrimination cases, is the motivation behind the adverse employment actions challenged by the plaintiffs. Unlike most other discrimination cases, however, this case contains affirmative evidence that could support a finding that the decision-makers at Xerox's Houston Center were following a policy of disfavoring black employees in filling vacant positions in order to correct a perceived racial imbalance in its workforce. The district court erroneously treated the evidence as irrelevant. On the contrary, as we explain below, the evidence is highly relevant to plaintiffs' claims that Xerox discriminated against them because of their race. If a jury finds on the basis of this evidence that race was a negative factor in Xerox's decision with respect to any of the specific actions challenged by the plaintiffs, then the burden of proof would shift to Xerox to establish that it would have made the same decision if race was not a factor.<2> In any event, the evidence concerning the implementation of the Balanced Workforce Initiative was clearly relevant to a determination as to whether Xerox's asserted, non-discriminatory reasons for the challenged decisions were pretextual. 1. The district court erred in ignoring the evidence concerning Xerox's Balanced Workforce Initiative in granting Xerox's motions for summary judgment. Viewed in the light most favorable to plaintiffs, that evidence could support a finding that Xerox officials decided that there were too many African-American employees and too few white employees at the Houston Center and, therefore, required managers to consider race in making hiring, transfer and promotion decisions throughout the 1990s in an effort to correct this perceived imbalance. Although Xerox argued that the BWF Initiative played no role in any of the employment decisions at issue in this case, the evidence in fact is sufficient to support a finding that racial considerations informed and shaped the company's decisionmaking processes. In cases under Title VII and other federal employment discrimination statutes, evidence is typically assessed using the familiar McDonnell Douglas framework, where plaintiffs attempt to establish unlawful motivation by negative inference – i.e., by showing that the employer's non-discriminatory explanation for a challenged employment decision is unworthy of credence. See, e.g., Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 146-49 (2000). Under the framework, the plaintiff initially establishes a prima facie case by eliminating the most obvious non-discriminatory explanations for a decision, generally by showing that there was an available position and she did not lack the basic qualifications for the position sought. Furnco Constr. Co. v. Waters, 438 U.S. 567, 575-76 (1978). See also Blow, 236 F.3d at 296. If a plaintiff establishes a prima facie case, the defendant must produce evidence of a legitimate, non-discriminatoy explanation for the decision at issue. The plaintiff must then prove that the employer's articulated reason is a pretext for discrimination, which she may do by showing that it is unworthy of credence, thus raising an inference that the true reason was discrimination. Reeves, 530 U.S. at 142-43.<3> This framework was developed in recognition of the fact that it is usually hard for a plaintiff to affirmatively establish that the employer based a challenged employment decision on race or another prohibited criterion. Reeves, 530 U.S. at 142-43. Because the employer should know the actual reason for a challenged decision, evidence that the explanation it asserted is unworthy of credence “may be quite persuasive evidence” that the true reason is discriminatory. Id. Occasionally there is sufficient affirmative evidence of motivation that it is unnecessary for a plaintiff to rely on the McDonnell Douglas framework. Usually referred to as “direct evidence,” such evidence, if believed, would be sufficient to support an affirmative finding that race or another prohibited criterion was a motivating factor in the challenged decision. See, e.g., Price Waterhouse v. Hopkins, 490 U.S. 228 (1989); Brown v. East Miss. Elec. Power Ass'n, 989 F.2d 858, 861-62 & n.8 (5th Cir. 1993) (supervisor's “routine use of racial slurs constitutes direct evidence that racial animus was a motivating factor in the contested disciplinary decisions”) (citing cases). In Price Waterhouse, 490 U.S. at 235, for example, the Supreme Court held that a finding that gender was a motivating factor in a partnership decision was properly based on evidence that plaintiff was told her chances for partnership would improve if she would take a “course at charm school;” walk, talk and dress “more femininely;” “wear make up, have her hair styled and wear jewelry.” Where a plaintiff can make such a showing, the burden shifts to the employer to prove that “it would have made the same decision even if it had not taken the [the prohibited factor] into account.” Id. at 258; see also 42 U.S.C. § 2000e-2(m); cf. White v. Federal Express Corp., 939 F.2d 157, 160 (4th Cir. 1991) (burden shifts whenever plaintiff, using “any sufficiently probative direct or indirect evidence,” shows unlawful discrimination was substantial factor in employment decision, citing Price Waterhouse).<4> In Bass v. Board of County Commissioners, 256 F.3d 1095, 1110-12 & n.7 (11th Cir. 2001), the Eleventh Circuit held that “the existence of an affirmative action plan, when combined with evidence that the plan was followed in an employment decision, is sufficient to constitute direct evidence of unlawful discrimination” and, so, remove the case from the McDonnell Douglas framework. This is true, the Court of Appeals added, even where – as in Bass - the defendant contests the validity of the evidence or disavows reliance on the plan. Id. at 1111. The Court reasoned that, unless it is valid under Title VII, an affirmative action plan “amounts to nothing more than a formal policy of unlawful discrimination.” Id. at 1111 n.7.<5> Applying that analysis, the Bass Court reversed a summary judgment for the employer, holding that, despite defendant's disclaimers, plaintiff's evidence that the employer “may have” acted pursuant to its affirmative action plan – which undeniably was in place during the relevant timeframe -- was direct evidence of racial discrimination precluding summary judgment. Id. at 1110-12. The Court based its decision on evidence that defendant had set county-wide goals for the hiring of minorities and pressured managers to hire or promote to meet the goals, the challenged decision was based on subjective interview scores, the successful candidate lacked minimum qualifications for the job, and a non-decisionmaker told plaintiff that the County “would continue to promote on the basis of color.” Id. at 1106-12. In our view, the same reasoning should lead to the same result in this case: plaintiffs' materials concerning the content and implementation of Xerox's BWF Initiative should be considered direct evidence of discrimination precluding summary judgment. While disavowing any reliance on the Initiative with respect to plaintiffs, Xerox does not deny that the BWF Initiative was in place throughout the relevant timeframe. If a jury believes the record evidence -- the Summary reports, BWF Guidelines and HRM plan, the senior staff notes and evaluations as well as the testimony of Doug Jean and Amos Benning -- it could find that management at the Houston Center considered race in its decisionmaking and that, because plaintiffs are African-American, their employment opportunities were sharply limited.<6> Specifically, in the Summary reports, Xerox identified explicit racial goals for each job and grade-level category; for African-Americans, that target sometimes was as low as zero. These reports state that blacks were overrepresented in virtually every job and grade-level category at the Houston Center, while whites were underrepresented. See, e.g., Arterberry SJR, Tab4. The reports were then used to monitor the company's progress towards reaching the listed target numbers. See, e.g., Frank's SJR, Ex10 (Jean Dep. 92); Ex47 (Benning Dep. 58-59) (reports show “whether we needed majority male, minority female, whatever the case may be”). Moreover, the BWF Guidelines explain that hiring, promotion and transfer decisions were “opportunities” to balance the workforce (Arterberry SJR, Tab1 at 7-8); other documents confirm that management was updated as to available “opportunities” for “majorities” or, sometimes, “majorities and hispanics” – but not for African-Americans. See, e.g., Tab2 at 2682 (1996 HRM Plan, stating that “opportunity exists for improvement in hiring qualified majority males and . . . females”); Tab5 (2666: 4/6/98 meeting notes, “opportunities are majority male and majority female – we have not made much progress”; 2664: 11/23/98 notes, opportunities for “majority and Hispanic”); Frank's SJR, Ex49 (same). Other evidence indicates that managers were evaluated on how well they followed and adhered to the “adamant” BWF objectives in making personnel decisions. See Tab6 (evaluations of Linda Carter and Joe Olivarez); Frank's SJR, Ex47 (Benning Dep. 66-67, 78). Indeed, the HRM plan documents state that the “responsibility for achieving a balanced work force lies with every member of the Houston Management Team.” Arterberry SJR, Tab2 at 2682; Tab1 at 7. Furthermore, although HR Manager Lloyd Buchanan adamantly denied that the company “involuntarily discharged” black employees as a means of reaching its racial targets, he did not deny that the targets were considered in hiring, promotion and/or pay decisions. XMSJ-Frank, Tab7 (Buchanan Decl. ¶¶ 3-4).<7> The testimony of Doug Jean and Amos Benning is telling. Jean stated that managers were told to “hire to meet the targets” which meant more white males and white females since those groups were underrepresented (Frank's SJR, Ex10 (Jean Dep. 42-43)); he also noted that money designated for merit pay increases was allocated based on “EEO categories.” Id. at 103, 150. He further described meetings with black employees where he showed them the racial target numbers and explained that “because of affirmative action we would be trying to hire to these particular targets.” Id. at 102. When he commented to an HR manager that it seemed unfair to discriminate against one “EEO category” just “to meet numbers,” he was told it was “the corporate direction.” Id. at 99. As for Benning, he stated that, as a manager, he considered himself “obligated to make sure [he] had a Balanced Workforce.” Frank's SJR, Ex47 (Benning Dep. 65). The Summary reports, he explained, showed whether his section was complying with the balanced workforce goals and, to the extent it was “out of compliance” -- in that it “needed a majority male, minority female, whatever the case may be,” when a hiring opportunity arose, he “would try to find a candidate that was qualified and met that profile.” Id. at 58-59, 66; see also id. at 64-65 (agreeing that “under/minus numbers” on BWF reports indicated who he needed to hire).<8> He also indicated that he could be penalized for not using opportunities to balance his workforce. Id. at 66-67, 78. Finally, there is the fact that over this nine- or ten-year period, these plaintiffs were consistently denied promotions (or their opportunities were otherwise expressly limited), and the successful candidates were not black. While the district court refused to consider evidence of employment decisions it found untimely, such decisions are, at a minimum, relevant background evidence to show a general pattern of minority employment. See National R.R. Passenger Corp. v. Morgan, 122 S. Ct. 2061, 2072 (2002); Vance v. Union Planters Corp., 209 F.3d 438, 445 & n.8 (5th Cir. 2000) (evidence of defendant's past treatment of employees in plaintiff's protected class “could help undermine” defendant's proffered reason regarding plaintiff). Viewing all of the evidence as a whole, we submit, a jury could find that Xerox managers favored white employees and disfavored black employees when making promotion and other employment decisions during the 1990s. We do not suggest, of course, that the mere fact an employer has an affirmative action plan -- or Balanced Workforce Initiative -- on the books constitutes direct evidence of discrimination. See Whalen v. Rubin, 91 F.3d 1041, 1045 (7th Cir. 1996). On the contrary, whether such a program affected a plaintiff's employment status is a “question of fact.” Id. at 1046. Where as here the employer disavows reliance on the program, there must be evidence from which a jury could find that the employer adhered to the program during the relevant timeframe and that it informed the employment decisionmaking at issue. See Bass, 256 F.3d at 1106. Based on our review of the record, we believe that the evidence is sufficient with respect to some or all of the employment decisions challenged by the plaintiffs.<9> With respect to Carol Frank, for example, a jury could find that the BWF Initiative adversely affected her upward mobility throughout the 1990s. During this period, Frank repeatedly sought promotion from Grade 6 to Grade 7 or above, both within her job category and outside it (see, e.g., Frank's SJR, Ex30) (DMSI Coordinator job was classified Grades 4-7). Although her performance was consistently praised, Frank was never promoted. During the time Frank was unsuccessfully seeking promotion above Grade 6, the BWF declared that African-Americans were overrepresented in Grades 7-9 and Grades 10+. See Arterberry RJS, Tab4 at 2670. Since the Balanced Workforce Reference Guide indicates that promotion from Grade 6 to 7 or above would constitute an “opportunity” for balancing the workforce, a decision to promote Frank, a member of an “overrepresented” group, would be a missed opportunity and redound to the detriment of the decisionmaker. See id., Tab1 at 7-8. This evidence is sufficient to support a finding that race was a motivating factor in Xerox's repeated refusals to promote Frank.<10> 2. The district court considered only one of Carol Frank's discriminatory promotion claims on the merits. In granting summary judgment on this claim, concerning a position as a Manager of Customer Operations (“MCO”), the district court analyzed the evidence under the McDonnell Douglas framework, and held that Frank could not establish that Xerox's assertion that she was denied that promotion based on qualifications was pretextual because she did not establish that she was “clearly better qualified” than the individual Xerox selected for the particular position. Order at 17. As we have argued above, we believe that this claim should not have been analyzed under McDonnell Douglas in light of the affirmative evidence that race was a factor in the decision. Nonetheless, even if the claim is analyzed under McDonnell Douglas, Frank was not required to prove that she was clearly better qualified in order to withstand summary judgment because she is not relying solely on evidence of comparative qualifications to establish discrimination. In Messer v. Meno, 130 F.3d 130 (5th Cir. 1997), the plaintiff alleged that she was denied promotions and undercompensated because of her race and sex, relying in part on evidence that her employer was adhering to an affirmative action plan. As in this case, the employer asserted that it based the challenged decisions solely on qualifications. This Court, analyzing the claims under McDonnell Douglas, reversed a summary judgment for the employer, holding that the evidence that the employer used its hiring and promotion practices to attain and maintain a balanced workforce raised an inference that, for applicants meeting the minimum qualifications, the employer considered race and/or gender in employment decisions. Id. at 139. By “arbitrarily discount[ing]” this evidence (id. at 137), the Court stated, the district court reached an erroneous conclusion that plaintiff failed to produce any facts that would show the employer's reasons for its personnel decisions regarding her were pretexts for discrimination. Id. at 139. This case is analogous to Messer; as in Messer, the district court here erred in “arbitrarily discounting” the evidence regarding Xerox's implementation of the BWF at the Houston Center. As explained above, this evidence, if believed, establishes that, throughout the 1990s, Xerox strove to attain and maintain a racially-balanced workforce and, as a result, employees such as Carol Frank were stuck in lower-level jobs because of their race. While not uncontroverted, the evidence, at a minimum, is sufficient to raise a material factual issue regarding whether Xerox's proffered reasons for its actions are unworthy of credence. See Messer, 130 F.3d at 139 (evidence appearing to “depict an agency-wide consciousness of race and gender as grounds for employment decisions” raises material issue of fact as to pretext); Whalen, 91 F.3d at 1045 (evidence is relevant to “key issue” of discriminatory intent). Moreover, in light of this additional evidence, the court erred in holding that, to withstand summary judgment, Carol Frank was required to show that she was “clearly better qualified” than Joe Olivarez, the individual to whom Xerox gave the MCO position. Order at 17-18. In reaching this decision, the court relied on Celestine v. Petroleos de Venezuela, 266 F.3d 343, 356-57 (5th Cir. 2001), which states that a “plaintiff may survive summary judgment and take his case to the jury by providing evidence that he was clearly better qualified than [the successful applicant].” The Celestine Court reasoned that the “single question for the trier of fact is whether the employer's selection of a particular applicant over the plaintiff was motivated by discrimination, and evidence of the plaintiff's superior qualifications is thus probative of pretext.” Id. However, the Court continued, the “bar is set high for this kind of evidence because differences in qualifications are generally not probative evidence of discrimination unless those disparities are ‘of such weight and significance that no reasonable person, in the exercise of impartial judgment, could have chosen the candidate selected over the plaintiff for the job in question.'” Id. See also Odom v. Frank, 3 F.3d 839, 847 (4th Cir. 1993) (showing of gross disparities ensures that court does not simply substitute its own judgment as to parties' comparative qualifications). As is clear from the decision, however, the reasoning of Celestine is limited to cases where, unlike here, plaintiffs attempt to prove pretext solely on the basis of comparative qualifications. The standard does not apply in cases such as this one where the plaintiff proffers other evidence from which a jury could find the employer's failure to select the plaintiff was motivated by discrimination. See Vance, 209 F.3d at 444 (plaintiff need not meet clearly better qualified standard where other evidence supports pretext finding); cf. Rutherford v. Harris County, 197 F.3d 173, 182 n.9 (5th Cir. 1999) (noting, in response to argument that plaintiff failed to show she was clearly better qualified, that she “did not attempt to prove pretext solely on the basis of her comparative qualifications”). Here, there is no dispute that Frank met the legitimate minimum qualifications for the MCO position, and Xerox does not deny that she also had a history of successful job performance and more education than the successful applicant. In addition to this evidence, however, plaintiffs proffered the BWF-related materials which, if believed, would show that Xerox considered race in making promotion decisions and that Frank's status as a Grade 6 exempt (non-sales) African-American applicant for the MCO position mattered. As discussed supra at 9-11, a decision to grant the promotion to Frank would have only increased the perceived overrepresentation of African-Americans in Grades 7 and above. By contrast, giving the job to Olivarez did not have negative implications under the BWF since he already held a management position (XMSJ-Frank, Tab3, Olivarez Aff. ¶ 3), and there is no reason to believe that moving him to a different management job would be considered a missed opportunity under the BWF. Accordingly, whether the BWF evidence is considered evidence of pretext or direct evidence of discrimination, it should obviate any need for Frank to also show that she was clearly better qualified than Olivarez. CONCLUSION For the foregoing reasons, the Commission respectfully asks this Court to reverse the judgment below and remand the case to the district court for further proceedings on the merits. Respectfully submitted, NICHOLAS M. INZEO Acting Deputy General Counsel PHILIP B. SKLOVER Associate General Counsel VINCENT J. BLACKWOOD Assistant General Counsel _____________________________ BARBARA L. SLOAN Attorney EQUAL EMPLOYMENT OPPORTUNITY COMMISSION Office of General Counsel 1801 L Street, N.W., Room 7014 Washington, D.C. 20507 (202) 663-4721 CERTIFICATE OF COMPLIANCE In accordance with Federal Rule of Appellate Procedure 32, I certify that this brief was prepared with Courier New (monospaced) typeface, 12 point font, and contains 6986 words, from the Statement of Interest through the Conclusion, as determined by the Word Perfect 9 word counting program. ____________________________ Barbara L. Sloan CERTIFICATE OF SERVICE I hereby certify that two copies of the foregoing brief were sent this 20th day of September, 2002, by first-class mail, postage prepaid, to the following counsel of record: Gordon R. Cooper II COOPER & COOPER 3003 South Loop West, Suite 108 Houston, TX 77054 Melvin Houston HOANG, LA & HOUSTON, P.C. 7011 Harwin, Suite 108 Houston, TX 77036 Michael V. Galo, Jr. AKIN, GUMP, STRAUSS, HAUER & FELD L.L.P. 300 Convent Street, Suite 1500 San Antonio, Texas 78205 __________________________ 1 The exhibits to Arterberry's Summary Judgment Response are not consecutively paginated. For clarity in Tabs 2-6, EEOC cites the Bates number on each document. 2 An employer could also attempt to justify the use of race-conscious affirmative action under United Steelworkers v. Weber, 443 U.S. 193 (1979), under which a private employer like Xerox may make race-conscious employment decisions only to “eliminate manifest racial imbalances in traditionally segregated job categories.” Id. at 197. Xerox has never argued that it would have been justified in favoring whites over blacks in making hiring, promotion or pay decisions under this standard. 3 Although this framework was developed under Title VII, this Court has also applied to claims under 42 U.S.C. § 1981. LaPierre v. Benson Nissan, 86 F.3d 444, 448 n.2 (5th Cir. 1996). 4 There is language in some of this Court's decisions suggesting a narrower definition of direct evidence which would include only “evidence [that] would serve to prove unlawful discrimination without any inferences or presumptions.” See, e.g., Scales v. Slater, 181 F.3d 703, 709 n.6 (5th Cir. 1999); cf. Portis v. First Nat'l Bank of New Albany, 34 F.3d 325 (5th Cir. 1994) (“any statement or written document showing a discriminatory motive on its face”). This definition cannot be applied literally in discrimination cases, however, since it would exclude what Justice O'Connor characterized as “direct evidence” in Price Waterhouse, 490 U.S. at 272-73. There, the partners never expressly informed the plaintiff that they would vote against her because of her sex. To find a violation, the court had to infer that, had she been a man, her personality traits and dress would not have barred her from becoming a partner. 5 As we noted, supra, the validity of Xerox's BWF Initiative is not at issue. Like the employer in Bass (and also in Messer v. Meno, 130 F.3d 130 ((5th Cir. 1997), discussed infra), Xerox has never argued that it properly could favor whites over blacks in making hiring, promotion or pay decisions. 6 To establish a claim of intentional race discrimination, plaintiffs need not show that the employer was motivated by racial animus. See International Union, UAW v. Johnson Controls, 499 U.S. 187, 199 (1991) (Title VII) (“absence of a malevolent motive” does not convert discriminatory practice into “neutral practice with discriminatory effect”); cf. Goodman v. Lukens Steel Co., 482 U.S. 656, 669 (1987) (§ 1981). 7 On the contrary, Buchanan testified that Amos Benning was sent to Houston as Sales Manager in 1998 to address concerns that there were no African-Americans on Durham's senior staff. XMSJ-Frank, Tab7 (Buchanan Decl. ¶¶ 3-5). Cf. Benning Dep. 78 (admitting hiring “minority male” because his team had none). This evidence demonstrates that Xerox engaged in race-conscious decisionmaking. While Xerox's witnesses never admitted hiring whites because of race, a jury could find that, where the numbers showed whites were underrepresented, Xerox also hired to meet those targets. 8 Durham stated that “Even under BWF, . . . Xerox will always select the most qualified candidate for a job, regardless of that person's race or gender” (XMSJ-Frank, Tab13 (Durham Decl. ¶ 5)), but a jury could find this statement self-serving in light of the other evidence. Xerox also proffered a copy of its generic non-discrimination policy from the early 1990s (XMSJ-Arterberry, Tab18), and an “Affirmative Action Policy Memo” (Williams Reply, Tab2), which was not issued until 1999 and states that promotion decisions should be “based on qualifications, considering only valid requirements for the position for which an individual is being considered,” without explaining when, if ever, race (or other prohibited criteria) might be a “valid requirement.” A jury could find that the generalized statements in these memos do not undercut the clear directives in the Balanced Workforce materials. 9 The district court essentially ignored the BWF-related materials in its orders dismissing the other plaintiffs' claims. In Frank's case, however, the court indicated that it was under the impression the Initiative was in place only from 1988-1990. Order at 17. That impression is simply inaccurate. As noted above, the evidence suggests that management in the Houston Center adhered to the BWF directives throughout the 1990s. 10 In arguing below that summary judgment was proper despite the BWF-related materials, Xerox cited, without explanation, Whalen, 91 F.3d 1041, and Cerrato v. San Francisco Community College, 26 F.3d 968, 976 (9th Cir. 1994). XMSJ-Frank at 9. The company elsewhere also cited Brown v. McLean, 159 F.3d 898 (4th Cir. 1998). These cases all involve affirmative action plans, but they are otherwise inapt. Significantly, all three plaintiffs lost after trial, not on summary judgment. In Cerrato, the Ninth Circuit rejected plaintiff's argument that the “mere existence of [an] affirmative action plan gives rise to discriminatory intent on the part of defendants.” 26 F.3d at 976. We agree, but that is not the argument here. We likewise agree with Whalen, where the Seventh Circuit upheld the district court's decision to let the jury determine whether defendant's affirmative action policy affected the challenged promotion decision. 91 F.3d at 1045-46. As for Brown, a divided panel of the Fourth Circuit, while “hesitat[ing] to say that there was no probative value to introducing the city's affirmative action plan into evidence,” ruled that the district court did not abuse its discretion in excluding it under Fed. R. Evid. 403 where, inter alia, plaintiff never applied for the job in question. 159 F.3d at 904-05.