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Logue v. International Rehabilitation Associates Inc.

filed: January 20, 1988.

ANNE M. LOGUE, PLAINTIFF-APPELLEE
v.
INTERNATIONAL REHABILITATION ASSOCIATES, INC., ET AL., DEFENDANTS-APPELLANTS



On Appeal from the United States District Court for the Western District of Pennsylvania, D.C. Civil Action No. 85-3010.

Becker, Scirica and Rosenn Circuit Judges.

Author: Scirica

Opinion OF THE COURT

SCIRICA, Circuit Judge.

This is an appeal in a suit alleging sex discrimination. Appellant International Rehabilitation Associates ("IRA" or "the company") appeals from the judgment granted in favor of one of its former employees, appellee Anne M. Logue ("Logue"), in a suit alleging employment discrimination under Title VII of the Civil Rights Act of 1964, 42 U.S.C. 2000e et seq. (1982) ("Title VII"). IRA maintains that the district court misapplied the legal standard under McDonnell Douglas Corp. v. Green, 411 U.S. 792, 36 L. Ed. 2d 668, 93 S. Ct. 1817 (1973), and Texas Dept. of Comm. Affairs v. Burdine, 450 U.S. 248, 67 L. Ed. 2d 207, 101 S. Ct. 1089 (1981). Specifically, IRA argues that the court failed to consider evidence presented by IRA to rebut Logue's prima facie case of discrimination. We conclude that the the district court misapplied the standard governing sex discrimination. We vacate the district court's judgment and remand for further proceedings consistent with this opinion.

I. Background

IRA is a rehabilitation service company, retained primarily by insurance carriers and self-insured employers to provide vocational and physical rehabilitation services to disabled persons.*fn1 Although IRA markets its services nationally, the events leading to this litigation occurred within the company's central region, which covers the eastern part of the United States from New York to Virginia. The central region contains several districts, each headed by a district office. Within each district are a number of branch offices. Each branch manager supervises various kinds of employees, including account representatives, rehabilitation supervisors, and vocational and rehabilitation specialists. Account representatives are responsible for marketing IRA's services to existing and potential customers. Vocational and rehabilitation specialists, who provide the actual services to the injured person, report to a rehabilitation supervisor.

IRA hired Logue in January, 1978, as a vocational specialist in its Pittsburgh district office. At that time, the Pittsburgh office handled the marketing and servicing for the state of Ohio. Within five months Logue was promoted to rehabilitation supervisor, a position which required her to supervise a number of vocational specialists who serviced the state of Ohio. In June, 1980, she was promoted to account representative and became responsible for marketing IRA's services in Ohio. Her immediate supervisor was Sharon Mains, who at the time was the Pittsburgh district manager.

In 1981, IRA decided to open a branch office in Columbus, Ohio, to service the entire state of Ohio. Mains selected Logue to open that office and act as its branch manager. After the Columbus office began operation in October, 1981, Logue not only performed her supervisory duties as branch manager, but also marketed IRA's services in Ohio, until Stewart Cohen, a vocational specialist, became account representative for the northern half of the state. Logue remained responsible for marketing the southern half of Ohio until June, 1982, when she promoted Kenneth Ross, another vocational specialist, to the position of account representative for that area.

Mains resigned from IRA in May, 1982. The following September, Lawrence Rozanski became the new district manager in Pittsburgh. In early 1983, he and Leo Hamilton, Vice President for the central region, decided to open an additional office in Cleveland. Stuart Cohen was chosen to be the branch manager for this new office, and Ross was selected to replace Logue in Columbus. IRA discharged Logue in March, 1983.

On December 23, 1985, Logue filed suit,*fn2 claiming that IRA terminated her employment because of her sex, in violation of Title VII. The district court conducted a nonjury trial that lasted three days. At the trial, Logue testified that although she was qualified for her position, IRA replaced her with a less experienced male employee, Kenneth Ross. To counter Logue's claim, IRA offered evidence (1) that it established a new management structure for Ohio which altered the nature of the position of branch manager and led to the elimination of one management position; (2) that IRA selected Ross over Logue because Ross' abilities as a marketing representative were considered outstanding; and (3) that Logue refused IRA's offer of a new job in Cincinnati and resigned from IRA.

At the conclusion of the trial, the district court found that Logue had presented a prima facie case of discrimination.*fn3 Appendix ("App.") at 472. The court then evaluated what it perceived to be IRA's proffered reasons for terminating Logue: (1) she resigned; (2) she refused the offer of a new position with IRA in Cincinnati; and (3) her performance was inadequate. Id. at 472-73. The court concluded that these explanations were pretextual. First, the court pointed out that the record contained no evidence that Logue had resigned. Id. at 472.*fn4 With respect to the alleged job offer in Cincinnati, the court found that no such position even existed until two years after Logue had left IRA. Id. at 472-73. Finally, the court rejected the claim that Logue's performance had been inadequate, finding not only that IRA's statistics were "confusing" and contradictory, but also that they failed to account for the fact that Logue had been given a tremendous amount of responsibility when she became branch manager in Ohio. Id. at 473-75. Based on these findings, the court decided that Logue's discharge resulted from sex-based discrimination. Id. at 476. On February 4, 1987, the district court entered final judgment in favor of Logue, awarding her reinstatement and back pay. This appeal followed.

II. Governing Law

In determining whether the district court misapplied the legal standard governing sex discrimination, we exercise plenary review. See United States v. Adams, 759 F.2d 1099, 1106 (3d Cir.), cert. denied, 474 U.S. 971, 88 L. Ed. 2d 321, 106 S. Ct. 336 (1985); ...


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