may not be cited except as provided by
Minn. Stat. sec. 480A.08, subd. 3 (1996).
STATE OF MINNESOTA
IN COURT OF APPEALS
Northwestern Travel Services, Inc., et al.,
Filed March 10, 1998
Hennepin County District Court
File No. 96547
Patrick M. Connor, Eric D. Satre, Connor & Satre, L.L.P., 900 Lumber Exchange Building, 10 South Fifth Street, Minneapolis, MN 55402 (for appellant)
Mary M. O'Brien, Anna L. Merklin-Lewis, Joseph W. Schmitt, Meagher & Geer, P.L.L.P., 4200 Multifood Tower, 33 South Sixth Street, Minneapolis, MN 55402 (for respondents) Considered and decided by Short, Presiding Judge, Harten, Judge, and Mansur, Judge.**
*Retired judge of the district court, serving as judge of the Minnesota Court of Appeals by appointment pursuant to Minn. Const. art. VI, § 10.
Jacqueline Andrews appeals the district court's summary dismissal of her claims against her former employer for breach of contract, unjust enrichment, whistleblower violations, age discrimination, and reprisal. We affirm.
On July 27, 1992, NIS retained Andrews as an independent contractor to work as a commissioned sales account executive selling travel programs to corporate customers. In February 1993, Andrews asked NIS to change her status to that of an employee. After discussions, NWT agreed to hire Andrews as a commissioned sales account executive and pay her a guaranteed first-year draw of $36,000.
Andrews signed the NIS Sales Compensation Plan, which compensated her on a commission basis similar to that of all the other NIS sales account executives. The plan provided that account executives must be employed by NIS at the time a travel program operates in order to be paid a commission for the program. Andrews also signed an acknowledgement that her employment with NIS was at-will.
In late 1993, NWT purchased another travel firm, Claudia Wilson & Associates (CWA). The founder of CWA, Claudia Wilson, became an employee of NIS and was promoted to General Manager of NIS in May 1994. The promotion made it impracticable for Wilson to continue servicing her accounts. Therefore, Wilson's accounts were distributed among the NIS employees. Craig Pixley, a former employee of CWA, initially received one of the largest accounts, the 3M Pharmaceutical account, because of his familiarity with it.
Andrews complained that she had never been given any existing accounts, and when Pixley was promoted several weeks later to Director of Sales and Marketing, Andrews successfully procured the 3M Pharmaceutical account in exchange for two lesser accounts.
Andrews also was assigned to a newly established experimental program with 3M's dental division to operate seminars for dentists across the country. 3M requested the full-time services of several NIS employees for one year to organize and operate the seminars. 3M agreed to compensate NIS for its employees' salaries and benefits and related overhead expenses.
In accordance with NIS standard billing procedures, bills for the 3M dental project were generated by the accounting department and then submitted to the account executive for final review before being sent to the client. Andrews reviewed the 3M dental project's draft bills, and in a September 7, 1994, memorandum, notified Pixley about a few minor overcharges and undercharges, which resulted in an overall reduction in the bill.
On October 6, 1994, Wilson warned Andrews in writing concerning instances of her unacceptable conduct. Wilson detailed a confrontation on September 29, 1994, that arose from the denial of Andrews' request for permission to fly first class to Milan; Wilson felt that Andrews inappropriately shouted at her and made unprofessional remarks. Wilson also cited Andrews' poor judgment and lack of "team focus" in assuming that the 3M billing errors resulted from unethical behavior rather than honest mistakes and in accusing Wilson and Pixley of dishonesty without adequate facts.
Also in the fall of 1994, the client contact person for the 3M Pharmaceutical account, Gary Cann, expressed dissatisfaction with Andrews' handling of the account. Wilson and Pixley discussed the issue with Andrews, and it was agreed that Andrews would be given another chance on the account despite the client's complaints.
During the discussions about her performance, Andrews (then age 59) suggested that Cann wanted a younger account executive. Wilson and Pixley asked Andrews whether Cann had made any such statement or innuendo. Andrews said that he had not, but asked Wilson to ask Cann if he wanted someone younger on his account. After further discussions, Andrews agreed that it would be highly inappropriate to ask a client whether it preferred to work with a younger person. Pixley also asked Andrews to let him know if Cann ever raised an age issue.
Although Andrews did not make a complaint about age discrimination, she hinted in a November 28, 1994, inter-office memo that Wilson and Pixley were considering reassigning her based on age. In response to Andrews' memo, Pixley invited Andrews to express any age-related grievances she had so that they could be resolved--and if Andrews did not have any such grievances, then she should stop insisting that she did have some. Pixley brought the matter to the attention of Becky Woods, NWT's Vice President of Human Resources, and Woods scheduled a meeting with Andrews and Pixley to investigate the matter. During this meeting on December 5, 1994, Andrews denied that she had experienced any age discrimination.
In early 1995, NIS implemented a new program to encourage account executives to generate new sales prospects. The account executives were asked to make 25 cold calls per month and set up five meetings with prospective clients. The top salesperson was not required to participate and another account executive with extensive industry contacts was given a lower quota of cold calls. NIS did not take any action against any employee who failed to meet the goals.
Although Andrews appears to have been one of NIS' top sales producers during this period, she continued to have strained relations with Wilson and Pixley because of her confrontational behavior. Following a sales meeting on August 3, 1995, Wilson recommended that Andrews' employment be terminated; Wilson felt that Andrews orally attacked Pixley. Wilson reviewed the situation with some members of NIS' executive committee, who, citing her history of disruptive and unprofessional behavior, approved Andrews' termination effective August 7, 1995. After Andrews' termination, the 3M Pharmaceutical account was returned to Pixley and Andrews' other accounts were divided among several current NIS employees, including some who were approximately Andrews' age.
Andrews filed suit against NWT, alleging breach of contract, violation of Minn. Stat. § 181.13, promissory estoppel, quantum meruit/unjust enrichment, whistleblower violations, age discrimination, and reprisal. The district court granted NWT's motion for summary judgment on all counts, finding that NIS had paid Andrews all commissions to which she was contractually entitled and that Andrews failed to provide sufficient evidence to support a prima facie case for retaliatory discharge or age discrimination. Andrews appeals the grant of summary judgment.
Hunt v. IBM Mid Am. Employees Fed. Credit Union, 384 N.W.2d 853, 855 (Minn. 1986); see also Minn. R. Civ. P. 56.05 (party opposing summary judgment "may not rest upon the mere averments or denials of the adverse party's pleadings"). A court may grant summary judgment where the nonmoving party presents evidence which merely creates a metaphysical doubt as to a factual issue and which is not sufficiently probative with respect to an essential element of the nonmoving party's case to permit reasonable persons to draw different conclusions.
DHL, 566 N.W.2d at 71.
1. Whistleblower Claim
Andrews bases her whistleblower claim on her complaints to her supervisors and a NWT accountant that there were overcharges in draft bills submitted to her for review. Andrews also apparently bases her whistleblower claim on her allegation that NIS retained advance deposits made by 3M Pharmaceutical.
Minn. Stat. § 181.932, subd. 1 (Supp. 1997) provides:
An employer shall not discharge, discipline, threaten, otherwise discriminate against, or penalize an employee regarding the employee's compensation, terms, conditions, location, or privileges of employment because:
(a) the employee, or a person acting on behalf of an employee, in good faith, reports a violation or suspected violation of any federal or state law or rule adopted pursuant to law to an employer or to any governmental body or law enforcement official.
Claims of retaliatory discharge in violation of Minn. Stat. § 181.932 must be evaluated using the three-step burden-shifting analysis adopted in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 93 S. Ct. 1817 (1973). McGrath v. TCF Bank Sav., 502 N.W.2d 801, 806 (Minn. App. 1993), modified, 509 N.W.2d 365 (Minn. 1993). The first step of the McDonnell Douglas three-part analysis requires Andrews to establish a prima facie case of retaliation by showing that (1) she engaged in conduct protected by Minn. Stat. § 181.932; (2) NIS took adverse employment action against her; and (3) there is a causal connection between the protected conduct and the adverse action. Thompson v. Campbell, 845 F. Supp. 665, 674 (D. Minn. 1994).
If Andrews presents a prima facie case of retaliation, then NIS must articulate a "legitimate, nondiscriminatory reason" for terminating her employment. McDonnell Douglas, 411 U.S. at 802, 93 S. Ct. at 1824. If NIS meets its burden by producing evidence of a "legitimate, nondiscriminatory reason" for termination, then Andrews must show, by a preponderance of the evidence, that NIS' articulated reason is a pretext for intentional retaliation. Id. at 804, 93 S. Ct. at 1825.
Andrews alleges that she opposed in good faith "the pattern and practice for over a year and a half of over-billing, and no known instance of under-billing." Nonetheless, we agree with the district court that Andrews failed to present sufficient evidence of an illegal overcharge scheme to avoid summary judgment on this purported whistleblower claim. To support her allegations, Andrews offered only one draft bill containing inaccuracies and an affidavit of a co-worker that there "were numerous instances of billing questions that always favored NIS and never the customer." The co-worker's conclusory statement lacks factual support, however, and the one draft bill offered as evidence actually contains both undercharges and overcharges, although the overcharges slightly exceeded the undercharges.
Moreover, as noted by the district court, there is no dispute that it was part of Andrews' job to review the draft bills to ensure their accuracy. Andrews presented no evidence that NIS knowingly sent 3M an inaccurate bill. In short, there is insufficient evidence to create a fact question as to whether NIS attempted to engage in any illegal practice on which Andrews was "blowing the whistle." In reporting and correcting the inaccuracies, Andrews was simply performing the duties of her job.
Furthermore, although Andrews alleges that she was treated differently after complaining about the inaccuracies, she failed to present sufficient evidence to create an issue of fact regarding a causal connection between her alleged protected conduct and her employment termination. Andrews was not terminated until many months after she complained about the inaccuracies, which timing does not create an inference of retaliatory motive. In addition, the record (including interoffice memoranda drafted by Andrews herself and other undisputed documents) leaves little doubt that Andrews consistently engaged in unnecessarily confrontational behavior, which was disruptive and inhibited her ability to get along with her supervisors and function effectively as an NIS employee.
Accordingly, we conclude that Andrews failed to establish a prima facie case of retaliatory discharge and the district court properly granted summary judgment on this claim.
2. Age Discrimination/Reprisal
To establish a prima facie case of age discrimination under the Minnesota Human Rights Act (MHRA), Andrews must either present direct evidence of NIS' discriminatory intent, or raise an inference of discrimination by presenting indirect evidence in accordance with the standards set forth in McDonnell Douglas. See Feges v. Perkins Restaurants, Inc., 483 N.W.2d 701, 710 (Minn. 1992) (McDonnell Douglas standards apply to age discrimination suits under MHRA).
Andrews' discriminatory discharge claim fails unless she establishes that (1) she was a member of a protected class; (2) she was qualified for the position from which she was discharged; and (3) she was replaced by a person sufficiently younger to permit an inference of age discrimination. Ward v. Employee Dev. Corp., 516 N.W.2d 198, 201 (Minn. App. 1994), review denied (Minn. July 8, 1994).
The district court found that because Andrews' accounts were redistributed among several employees after she was terminated, some of whom were approximately Andrews' age, the third element was not satisfied. Andrews argues that she was "replaced" by the younger Pixley and that her termination did not constitute a "reduction in force" negating an inference of age discrimination. Andrews also argues that although some of her smaller accounts were distributed to employees approximately her age, the bulk of her business was given to Pixley, and Pixley was unable to handle all of her accounts because of his inability.
We agree with the district court that Andrews' termination and Pixley's simultaneous demotion constituted a bona fide NIS reduction in force from eight to seven employees. NIS was restructured and the workload was redistributed. The return to Pixley of Andrews' largest account, 3M Pharmaceutical, does not raise an inference of age discrimination, particularly considering Pixley's prior familiarity with the account, the distribution of some accounts to other employees approximately Andrews' age, and the lack of any other evidence indicating a pattern of age discrimination at NWT. See Dietrich v. Canadian Pacific, Ltd., 536 N.W.2d 319, 324 (Minn. 1995) (identifying factors to be used in evaluating reduction in force cases).
Although Andrews claims that the original distribution of Wilson's accounts and the "cold-calling" quotas evidence NIS' discriminatory intent, we agree with the district court that these allegations are without merit. Andrews provided no evidence that she was adversely affected by the "cold-calling" program or that NIS' reasons for the lesser quotas imposed on two younger employees were pretextual. Andrews requested and was granted one of NIS' largest accounts, 3M Pharmaceutical, in the 1994 distribution of Wilson's accounts, and NIS gave Andrews a second chance with that account despite the client's dissatisfaction with her.
Moreover, at the December 5, 1994 personnel meeting, which was specially called to allow her to voice complaints, Andrews specifically denied being subjected to age discrimination by NIS. Nor did she report any discrimination to NIS between the time of that meeting and her termination on August 7, 1995. Because Andrews has presented no evidence demonstrating a causal connection between the alleged discrimination and her termination, we conclude that she has failed to present a prima facie case of wrongful discharge or reprisal.
In summary, because we agree with the district court that Andrews failed to present any evidence creating a genuine issue of material fact on any of her claims, we conclude that the district court properly granted summary judgment.
 Andrews does not pursue on appeal her claimed violation of Minn. Stat. § 181.13. Andrews conceded at oral argument that her claims of breach of contract, promissory estoppel, and quantum meruit/unjust enrichment fail if she was not wrongfully discharged. Accordingly, because we agree with the district court that Andrews failed to establish a prima facie case of wrongful discharge, we do not address those claims further.
 As noted by the district court, Andrews failed to present any evidence to support this allegation in opposing summary judgment. On appeal, Andrews merely repeats the allegation. We agree with the district court that Andrews has failed to support the allegation and therefore do not address it further.