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McMichael v. Transocean Offshore Deepwater Drilling, Inc.

United States District Court, S.D. Mississippi, Eastern Division

December 10, 2018




         This cause comes before the Court on Defendants' Motion for Summary Judgment [56]. Plaintiff has filed his response and memorandum in opposition [59, 60], and Defendants have filed a reply [63]. Having reviewed the pleadings, the parties' submissions, the record in this matter, and the applicable law, and otherwise being fully advised in the premises, the Court concludes that the motion is well taken and will be granted.


         Transocean discharged Robert McMichael (“McMichael”) on April 25, 2015.[1] McMichael was 59 years old at the time of his termination and had been employed with Transocean for just over fourteen (14) years on deep water rigs, most recently as a toolpusher. In his Second Amended Complaint McMichael alleges that the Defendants (“Transocean”) discharged him because of his age in violation of the Age Discrimination in Employment Act of 1967 (“ADEA”), 29 U.S.C. § 621 et seq. McMichael was terminated and his toolpusher position on the Discoverer Clear Leader was filled by Jody Eckert, an individual who was 49 years old.

         Defendants contend that McMichael was one of approximately 7, 320 Transocean employees who have been laid off in the past four years as a result of one of the largest economic downturns in the history of the oil and gas industry. Transocean brings this summary judgment motion on the grounds that McMichael can produce no evidence in this case showing that he was laid off because of his age.


         Transocean hired McMichael in 2001 as a Driller I and assigned him to an offshore drilling rig. [56-3]. He was 46 years old at the time he was hired. [56-4] at 13:10-12. McMichael received numerous promotions and pay raises throughout his employment with Transocean. Id. at 45:12-47:2; [56-3]. In February 2009, after working as a driller and toolpusher on a number of rigs, McMichael went to work as a toolpusher on a drillship called the Discoverer Clear Leader (“DCL”). [56-4] at 47:3-48:5. Gordon Kennedy was the Rig Manager of the DCL from August 1, 2013 until April 17, 2016. [56-5] at ¶ 3; [56-4] 69:7-13, 69:25-70:3. Gary Mosley was a senior toolpusher on the DCL and one of McMichael's supervisors. [56-4] at 26:27-27:1. Robert Blansett was an offshore installation manager (OIM) on the DCL. [56-4] at 36:25-37:6. Robert Owen was also an OIM who supervised McMichael when he was a toolpusher on the DCL. [56-4] 64:8-11. McMichael worked on the DCL for over five years until his layoff in April 2015. [56-4] at 47:6-13; 48:6-8. He got along well with all of his supervisors and never had any issues. [56-4] at 65:4-69:6.

         Due to an economic downturn in the oil and gas industry, Transocean has reduced its offshore fleet by 44 rigs over the past four years, which has resulted in 7, 320 Transocean employees being laid off between the first quarter of 2014 and July of 2018. [56-2] at ¶¶ 4, 6. Transocean's HR department was tasked with managing these large reductions in force. [56-2] at ¶ 4. Transocean devised and utilized a system known as the “high-grading process” to select employees for inclusion in these reductions in force. Id. This process results in layoffs of lower graded employees, which is then followed by reorganization of the remaining offshore workforce. Id. at ¶ 5. The goal of the high grading process is to reduce the overall size of the workforce while identifying and retaining the best offshore rotational employees. Id. at ¶ 4.

         In early 2015, Transocean “cold-stacked”[2] six drilling rigs, which reduced the overall headcount on those rigs from 989 employees to zero. [56-2] at ¶ 7. Consequently, Transocean engaged in the high grading process to determine how to reorganize its workforce to ensure that it retained its top talent. Id. at ¶ 4: [56-1] 8:8-17.

         The high grading process has three basic components-(1) performance; (2) ranking; and (3) potential. [56-1] at 8:8-23; [56-2] at ¶ 9. The performance score is based on the employees' most recent performance appraisal and is comprised of two components that are averaged together to arrive at the overall performance score. [56-2] at ¶ 10. The Rig Manager determines both ranking and potential. [56-2] ¶¶ 11-12. These three ratings are converted into a percentage and averaged together to determine an employee's “Total Score.” [56-2] at ¶ 9. The Total Score is used as a data point to facilitate conversations between the Rig Managers and HR, but it is the Rig Managers who are ultimately responsible for the lay-off decisions. [56-1] at 14:3-15:10; 21:25-22:13; [56-2] at ¶ 21; [56-6] at 15:9-21:15. During these conversations, the Rig Managers and HR discuss the employee ratings, validate the ratings, fill in information missing from the ratings, assess employees' overall performance, and make decisions pertaining to the reorganization of Transocean's workforce, including who to lay off, who to retain, and who to transfer. See id. Because layoffs were frequent during the time of McMichael's layoff, it was not uncommon for Rig Managers to rank employees and evaluate their potential after the meeting with HR had taken place. [56-2] at ¶ 14.

         On his 2014 Performance Appraisal, completed by Gary Mosley and Robert Blansett, McMichael received a rating of #3 “Fully Successful.” [58-8]. Based on the outcome of the high grading process and discussions with HR, Gordon Kennedy, who was 51 years old at the time, made the decision to lay off McMichael as part of a large reduction in force, which termination occurred on April 25, 2015. [56-5] at ¶¶ 2, 4, 10-12; [56-4] at 48:6-8; [56-1] 62:11-15, 65:9-11. Of the twenty-five toolpushers who were ultimately laid off (including McMichael), nine were working on rigs that were not cold stacked. [56-2] at ¶ 20. In 2015, almost all of the toolpushers who were laid off worked on rigs that were not cold stacked at the time. Id.

         Following McMichael's layoff, Kennedy then had three weeks to backfill his position with a higher graded employee. [56-5] at ¶ 12. He requested a list of toolpusher replacements from HR along with past appraisals and work history and spoke to the previous supervisors and Rig Managers of the higher graded toolpushers to get their feedback before making the backfill selection. Id. After reviewing Jody Eckert's most recent performance appraisal in which he received a rating of #4 “Superior, ” reviewing documentation on Eckert related to the high grading process, and speaking to personnel with whom he worked, Kennedy selected Jody Eckert, who was 49 years old at the time, to fill the tool pusher position and replace McMichael on the DCL.[3]Id.; [56-2] at ¶ 22; [56-9]. Kennedy had never worked with or met Mr. Eckert when he selected Eckert for the DCL and was also not aware of Mr. Eckert's age at the time he was selected. Id. McMichael also does not know Mr. Eckert and has never worked with him. [56-4] at 28:23-25.

         In June 2015, McMichael received an email from Allan Windham, a mechanical supervisor on the DCL, who attached a list called a “strength report” that showed the birth dates of toolpushers on the DCL and told McMichael to take note of Eckert's age; it was then that McMichael learned for the first time that someone younger than he replaced him. [56-4] p.102-104; [56-7]. McMichael never complained about age discrimination while employed there. [56-4] 123:7-10. He does not know who made the decision to lay him off, and he does not know who discriminated against him because of his age. [56-4] 113:4-11; 123:11-16. McMichael knew Gordon Kennedy personally and got along well with him, with no professional problems working with Mr. Kennedy. [56-4] 68:17-69:3. In his declaration in opposition to summary judgment, McMichael recalls that Robert Owen, an OIM on the DCL, told McMichael at least twice in July 2014 that because that McMichael was over 59½ years old, he had nothing to worry about because he could receive his pension without the IRS imposing a penalty. [59-2] at ¶ 13. McMichael felt this was a coded reference to his age. Id.


         A. Summary Judgment Standard

         Summary judgment “should be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to a judgment as a matter of law.” Am. Gen. Life Ins. Co. v. Hannah, No. 1:12-cv-00087, 2014 WL 1413540 at *9 (N.D. Miss. Apr. 11, 2014) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)); Fed.R.Civ.P. 56(c). The moving party bears the initial burden of showing there is no genuine issue for trial, and it may do so by pointing out “‘the absence of evidence supporting the nonmoving party's case.'” Skotak v. Tenneco Resins, Inc., 953 F.2d 909, 913 (5th Cir.), cert. denied, 506 U.S. 832 (1992) (quoting Latimer v. Smithkline & French Labs., 919 F.2d 301, 301 (5th Cir. 1990)).

         If the moving party meets this burden, the nonmoving party who will have the burden of proof at trial must come forward with summary judgment evidence establishing the existence of a genuine issue; that evidence must be such that if introduced at trial it would suffice to prevent a directed verdict against the nonmovant. Celotex, 477 U.S. at 321. A dispute is “genuine” if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986); see also Sierra Club, Inc. v. Sandy Creek Energy Assocs., L.P., 527 F.3d 134, 138 (5th Cir. 2010) (“An issue is material if its resolution could affect the outcome of the action.”). “Summary judgment is mandatory against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial.” Fife v. Vicksburg Healthcare, LLC, 945 F.Supp.2d 721, 729 (S.D.Miss. 2013) (internal quotations omitted) (quoting Brown v. Offshore Specialty Fabricators, Inc., 663 F.3d 759, 766 (5th Cir. 2011)).

         B. Analysis of Evidence Under ADEA Analytical Framework

         The ADEA makes it unlawful for an employer “to discharge any individual or otherwise discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's age . . . .” 29 U.S.C. § 623(a). When there is no direct evidence of age discrimination, as is the case here, it is well established that the plaintiff must follow the three-step burden-shifting framework established in McDonnell Douglas Corp. v. Green,411 U.S. 792 (1973).[4]See Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 142 (2000) (assuming without deciding, that the McDonnell Douglas burden-shifting framework applies to ADEA claims); Novak v. Chicago Title of Tex., L.L.C., No. 18-50040, 2018 WL ...

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