                    United States Court of Appeals
                           FOR THE EIGHTH CIRCUIT
                                     ___________

                                 Nos. 02-1025/02-1029
                                     ___________

Equal Employment Opportunity              *
Commission,                               *
                                          *
             Appellant,                   *
                                          * Appeal from the United States
      v.                                  * District Court for the
                                          * Western District of Missouri.
Liberal R-II School District,             *
                                          *
             Appellee.                    *
                                     ___________

                                Submitted: September 12, 2002

                                    Filed: December 31, 2002
                                     ___________

Before HANSEN, Chief Judge, RILEY, and SMITH, Circuit Judges.
                              ___________

RILEY, Circuit Judge.

       The Equal Employment Opportunity Commission (EEOC) sued the Liberal R-
II School District (District) for violating the Age Discrimination in Employment Act
(ADEA) when the District failed to renew the contract of 70-year old school bus
driver George Trout (Trout). The district court granted summary judgment to the
District and awarded it $47,332.50 for attorney fees and expenses under the Equal
Access to Justice Act (EAJA). The EEOC appeals. Because sufficient direct
evidence of age discrimination exists to create an issue of material fact, we reverse
the district court’s grant of summary judgment and vacate the order awarding attorney
fees.

I.     BACKGROUND
       In October 1994, the District hired Trout as a school bus driver. At that time,
Trout was 66 years old. On April 20, 1998, the District’s Board of Education (Board)
voted 4-1 not to rehire Trout for the following school year. The Board hired three
additional bus drivers between the ages of 39 and 43. A 67-year old bus driver was
reassigned to drive Trout’s former route.

       The Board had the sole legal authority to make the District's hiring and firing
decisions. Notwithstanding, the District's superintendent, H.G. Gretlein (Gretlein),
also had employee responsibilities. During the April 20 board meeting, Gretlein
recommended all employment contracts be renewed, including Trout's. Gretlein was
the only non-board member present during the Board's closed door meeting to deny
renewal to Trout, but did not participate in the Board’s discussion. He was also
responsible for informing employees of the Board’s decision and indeed informed
Trout that the Board had decided not to renew his contract. Gretlein also represented
the Board in opposing Trout’s application for unemployment benefits.

      In May or June 1998 (after the Board's April 20 meeting), Trout alleges he
asked Gretlein why he was not going to be employed the following school year and
Gretlein said "that the Board thought that [Trout] was too old.” Trout also claims
Gretlein informed him the Board “felt” he “was too old to drive a bus." Gretlein
"absolutely" and "vehemently" denies saying Trout was fired because he was too old.
The Board members deny age was discussed and deny Trout's age entered into their
decision, citing instead safety concerns.

     Trout applied for unemployment benefits after the District did not renew his
employment contract. On the District's behalf, Gretlein protested the payment of

                                         -2-
unemployment benefits to Trout by responding with the following written statement
to the Missouri Department of Labor and Industrial Relations, Division of
Employment Security:

      On behalf of the Liberal R-II School District, I wish to protest the
      payment of benefits to the above individual. Mr. George Trout had
      served as a bus driver for the district. The fact that Mr. Trout is now 70
      1/2 years of age and that the public had voiced concerns about his
      driving safety, his continuation as a bus driver for the coming year was
      not approved by the Board of Education. The Board cited student safety
      as their reason for Mr. Trout's noncontinuation as a bus driver.

(Emphasis added.) When asked at his deposition why he mentioned Trout’s age,
Gretlein responded by saying “I really don’t know. I assume that it was probably
because he was retirement age.” Gretlein labeled Trout's assertion that Gretlein had
said the Board felt Trout was "too old" as "[l]ibelous, slanderous, whatever the word
is." Gretlein did not apply a similar label to his age comment about Trout in the
District's unemployment benefits response.

       The District claims Trout was not rehired because of safety reasons and
explains the Board discussed only safety-related issues when deciding not to renew
Trout’s employment contract. The District provided evidence Trout drove a bus full
of children the wrong way on a highway entrance ramp. Trout claims the ramp’s
signs were mismarked. The District presented evidence Trout cut off another driver,
but Trout claims another bus driver was involved in that incident. The District also
alleged Trout pulled out in front of another driver, but Trout claims the other driver
was mistaken. In the face of evidence showing Trout was an unsafe driver, the EEOC
offered evidence that (1) not all Board members knew about all of these safety issues
and (2) the District had not removed younger drivers when safety complaints had
been lodged against them.



                                         -3-
II.   DISCUSSION
      A.      Standard of Review
      The district court's grant of summary judgment to the District must be reviewed
de novo, viewing the record in the light most favorable to the EEOC and giving the
EEOC the benefit of all reasonable inferences. Keathley v. Ameritech Corp., 187
F.3d 915, 919 (8th Cir. 1999). This circuit "has repeatedly cautioned that summary
judgment should seldom be granted in the context of employment actions, as such
actions are inherently fact based." Id. In addition, "[s]ummary judgment should be
cautiously granted in discrimination cases because such cases often depend on
inferences rather than on direct evidence." Jacob-Mua v. Veneman, 289 F.3d 517,
520 (8th Cir. 2002).

       The district court's interpretation of the EAJA and its applicability to ADEA
actions are legal conclusions that are reviewed de novo. Madison v. IBP, Inc., 257
F.3d 780, 796 (8th Cir. 2001), vacated by 122 S. Ct. 2583 (2002) (unrelated issue).
The district court's award of attorney fees under the EAJA is reviewed under an abuse
of discretion standard. Friends of the Boundary Waters Wilderness v. Thomas, 53
F.3d 881, 884 (8th Cir. 1995).

       B.    Age Discrimination in Employment Act
       The ADEA prohibits an employer from discharging “any individual or
otherwise discriminat[ing] 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)(1) (2000). The ADEA only protects individuals who are at least
forty years old. Id. at § 631. The core issue in this case is whether the District
intentionally discriminated against Trout based on his age. Kneibert v. Thomson
Newspapers, Inc., 129 F.3d 444, 451 (8th Cir. 1997).

      The EEOC has two methods available to prove the District intentionally
discriminated against Trout based on his age. First, the EEOC can utilize the Price

                                         -4-
Waterhouse method by producing direct evidence that age “played a motivating part
in [the District’s] employment decision.” Price Waterhouse v. Hopkins, 490 U.S.
228, 258 (1989). If the EEOC can produce such direct evidence of age
discrimination, “the burden then rests with the [District] to convince the trier of fact
that it is more likely than not that the decision would have been the same absent
consideration of the illegitimate factor.” Id. at 276 (O’Connor, J., concurring); see
also id. at 258.

       The second method available to the EEOC to prove intentional age
discrimination is the well-established McDonnell Douglas three-part burden shifting
analysis, which is used solely for cases devoid of direct evidence of discrimination.
McDonnell Douglas Corp. v. Green, 411 U.S. 792, 800-04 (1973). The McDonnell
Douglas analytical framework using circumstantial evidence has developed because
direct evidence of discrimination is rare. The Supreme Court has made the following
observation: “All courts have recognized that the question facing triers of fact in
discrimination cases is both sensitive and difficult. . . . There will seldom be
‘eyewitness’ testimony as to the employer's mental processes.” United States Postal
Serv. Bd. of Governors v. Aikens, 460 U.S. 711, 716 (1983). This court has
expounded on this observation by explaining that "'[t]here will seldom be eyewitness
testimony as to the employer's mental processes' because a shrewd employer will not
leave a trail of direct inculpatory evidence for the plaintiff to bring into court.”
Rothmeier v. Inv. Advisors, Inc., 85 F.3d 1328, 1332 (8th Cir. 1996) (quoting Aikens,
460 U.S. at 716) (alteration in original). A "smoking-gun" case in the discrimination
arena is rare. Id.

       Is there potential eyewitness testimony as to the Board’s mental processes in
this case? Has the EEOC presented direct evidence of discrimination in this case so
that the Price Waterhouse standard applies? We believe so.




                                          -5-
        C.     Direct Evidence of Age Discrimination
        The Supreme Court has defined direct evidence in the negative by stating that
it excludes "stray remarks in the workplace," "statements by nondecisionmakers," and
"statements by decisionmakers unrelated to the decisional process itself." Price
Waterhouse, 490 U.S. at 277 (O'Connor, J., concurring) (“What is required is . . .
direct evidence that decisionmakers placed substantial negative reliance on an
illegitimate criterion in reaching their decision.”). This circuit has stated that "direct
evidence may include evidence of actions or remarks of the employer that reflect a
discriminatory attitude." Beshears v. Asbill, 930 F.2d 1348, 1354 (8th Cir. 1991)
(quoting Gray v. Univ. of Ark., 883 F.2d 1394, 1398 (8th Cir. 1989)). In addition,
"[c]omments which demonstrate a 'discriminatory animus in the decisional process'
. . . or those uttered by individuals closely involved in employment decisions may
constitute direct evidence within the meaning of Price Waterhouse." Beshears, 930
F.2d at 1354. As we recently stated, "[t]he direct evidence required to shift the
burden of proof is evidence of conduct or statements by persons involved in making
the employment decision directly manifesting a discriminatory attitude, of a sufficient
quantum and gravity that would allow the factfinder to conclude that attitude more
likely than not was a motivating factor in the employment decision." Erickson v.
Farmland Indus., Inc., 271 F.3d 718, 724 (8th Cir. 2001). Finally, the EEOC "must
present evidence showing a specific link between the discriminatory animus and the
challenged decision." Stacks v. Southwestern Bell Yellow Pages, Inc., 996 F.2d 200,
202 n.1 (8th Cir. 1993).

       We are presented with a troublesome case. Although we recognize the EEOC
may not have a particularly strong case for a jury, we are not the jury. Our duty is to
view the record in the light most favorable to the EEOC while giving the EEOC the
benefit of all reasonable inferences. In doing so, we find genuine issues of material
fact such that summary judgment is improper.




                                           -6-
       The District relies too heavily on the fact Gretlein was not the actual
decisionmaker who decided Trout’s fate. Although we agree Gretlein was not the
actual decisionmaker, that does not end our direct evidence inquiry. We stress this
is not a case involving a nondecisionmaker who was not involved in the
decisionmaking process and who made stray age-related remarks. Instead, this case
involves a nondecisionmaker who was closely involved in the decisionmaking
process and who was directed to express the decision of the decisionmakers to the
employee and to the Missouri Division of Employment Security. Although hotly
disputed, these expressions indicated the actual decisionmakers may have based their
decisions, at least in part, on age-based animus.

      Gretlein was the only non-board member present when the Board decided not
to renew Trout’s contract. When Gretlein fulfilled his obligation of delivering the
Board’s decision to Trout, Gretlein reportedly said the Board decided Trout was too
old to drive a bus. Gretlein “absolutely” and “vehemently” denies making this
statement, and the board members deny making any age-based statements in their
deliberations. Although a jury might believe Gretlein and the Board and disbelieve
Trout, we cannot wholly dismiss Gretlein’s alleged statements at the summary
judgment stage. A jury could reasonably infer the Board made age-based comments
when making its decision and Gretlein dutifully reported the Board’s decision and
reasons to Trout.

       Are we prepared to reject potential eyewitness testimony when a plaintiff
presents it? We should not. Of course, the jury will be free to reject Trout’s
allegation about what Gretlein told him, but we cannot do so now, as that would
require credibility determinations.

      In this case, Trout’s self-serving testimony of what Gretlein told him does not
stand alone. Gretlein also made an age-based statement to the Missouri Division of
Employment Security when opposing Trout’s application for unemployment benefits.

                                        -7-
Gretlein, on "behalf of the Liberal R-II School District," said the “fact that Mr. Trout
is now 70 1/2 years of age and that the public had voiced concerns about his driving
safety, his continuation as a bus driver for the coming year was not approved by the
Board of Education.” We note even Gretlein is not sure why he made this age-related
statement. Although we could certainly draw different reasonable inferences as to
what Gretlein may have meant, including that he did not mean age was a reason for
not renewing Trout’s employment contract, we are not authorized to determine which
reasonable inference is most likely. A jury is.

        Our prior decisions support this conclusion. This circuit was recently
confronted with a similar direct evidence case under Title VII. In Ross v. Douglas
County, 234 F.3d 391, 393-94 (8th Cir. 2000), a black employee sued his former
employer for disparate treatment, claiming white workers were allowed to withdraw
their resignations while he was not. An administrative assistant told “the Chief
Warden of the facility” that the black employee should also be allowed to withdraw
his resignation as white employees had been allowed to do in the past. According to
the assistant, the warden then told her that the employee “was a ‘black radical,’ and
if he would allow him to come back, all he’s going to do is stir up the black officers.”
Id. at 394. On appeal, we held this testimony “was clearly enough direct evidence to
support a Price Waterhouse instruction, and thus, to support the jury’s verdict”
against the employer. Id. at 397.

       As in Ross, we are also confronted with testimony by a nondecisionmaker as
to what the decisionmakers said. Although we do not have a specific quote, we have
even more. In Ross, the assistant was not part of the decisionmaking process, but
simply testified as to the decisionmaker’s statement. In our case, Gretlein was present
when the Board made its decision and was required to inform Trout of the Board's
decision. We believe Gretlein’s statements on the Board’s behalf to Trout and to the
unemployment office are as much, or more, direct evidence of age animus as the
assistant’s testimony in Ross.

                                          -8-
       The District seems to argue that only testimony from the Board members would
constitute direct evidence (i.e., the Board members would have to testify they took
age into account or made age-based comments in the decisional process). We have
already rejected this theory. In Beshears, although a company president testified he
did not make an age-based statement, “at least five people testified that they heard
[him] make a statement to the effect that older employees have problems adapting to
changes and to new policies.” Beshears, 930 F.2d at 1354. We held this testimony,
along with age-related statements by another decisionmaker, constituted direct
evidence of age discrimination. Id.

       The District and the district court rely on Kells v. Sinclair Buick-GMC Truck,
Inc., 210 F.3d 827 (8th Cir. 2000). In Kells, the plaintiff complained to the 49%
owner that he had been mistreated. When told Kells was fifty, the 49% owner stated,
“[w]hen you get that age, those things happen to you in our company.” Id. at 835.
We held this comment was not direct evidence of discrimination because the 49%
owner was not involved in the company’s management and did not actively
participate in the employment decision. Id. In addition, his comment was not based
“on any direct observations of [the employer]’s practices, policies or attitudes
concerning older employees.” Id. Gretlein, as superintendent, was involved in the
District’s management and did participate in the employment decision by attending
the closed-door meeting and was directed to inform Trout of the Board’s decision.
Our decision in Kells simply does not preclude our finding that Gretlein’s age-based
statements constitute direct evidence of discrimination. If anything, it supports our
decision here.

       Finally, the seminal case of Price Waterhouse itself involved testimony of a
partner involved in the partnership meeting that decided Ann Hopkins would not
make partner. The partner, who bore the responsibility of informing Hopkins she did
not make partner, told her that, “in order to improve her chances for partnership,
. . . Hopkins should ‘walk more femininely, talk more femininely, dress more

                                         -9-
femininely, wear make-up, have her hair styled, and wear jewelry.’" Price
Waterhouse, 490 U.S. at 235. This constituted direct evidence of gender
discrimination. In addition, Justice O’Connor made the following observation about
how Hopkins had offered as much direct evidence as she could by showing that
decisionmakers had based their decisions on gender stereotypes:

      It is as if Ann Hopkins were sitting in the hall outside the room where
      partnership decisions were being made. As the partners filed in to
      consider her candidacy, she heard several of them make sexist remarks
      in discussing her suitability for partnership. As the decisionmakers
      exited the room, she was told by one of those privy to the
      decisionmaking process that her gender was a major reason for the
      rejection of her partnership bid.

Id. at 272-73.

       This case presents a similar situation. Instead of sitting outside the room when
the Board members entered and exited, Trout had the next best thing – Gretlein.
Gretlein was required to, and did, inform Trout of the Board’s decision not to renew
his contract. At the summary judgment stage, we cannot reject as untrue the evidence
of Gretlein's statements that seemingly indict the Board for making age-based
comments in the decisional process.

       Finally, we fully understand and appreciate that safety is the most critical issue
when deciding to retain school bus drivers. Notwithstanding, the record does not
clearly establish the Board would have decided not to rehire Trout based on safety
issues alone. The EEOC presented evidence that some of the Board's knowledge of
safety concerns arose after the decision not to rehire Trout, Trout had explanations
for each safety incident, and the EEOC offered some evidence that the Board allowed
younger drivers with safety complaints to continue driving. The EEOC also offered
evidence at least one board member and Gretlein himself wanted Trout to drive again.
Therefore, we believe a jury must decide (1) whether age played a motivating part in

                                          -10-
the Board’s employment decision, and (2) whether the Board would have made the
same decision not to renew Trout’s employment contract absent consideration of his
age.

       Because we hold that the EEOC has presented direct evidence of
discrimination, the Price Waterhouse standard applies and we need not address the
McDonnell Douglas standard. Bashara v. Black Hills Corp., 26 F.3d 820, 823 (8th
Cir. 1994) (citing TWA v. Thurston, 469 U.S. 111, 121 (1985)) (“If the plaintiff
offers direct evidence of age discrimination, however, the McDonnell Douglas
analysis is inapplicable. . . . That is, when direct evidence of discrimination exists, the
plaintiff need not establish a prima facie case because creating an inference of
discrimination is unnecessary.”).

       D.    Attorney Fees
       This circuit has not addressed whether the EAJA's substantially justified
standard can be used to award attorney fees to prevailing defendants in cases brought
by the United States under the ADEA. The district court awarded fees to the District
after it held the EAJA applies and the EEOC was not substantially justified in
bringing this action. Because we hold the EEOC was substantially justified in
bringing this action and the District is not a prevailing party at this time, we do not
reach the issue of whether the EAJA's substantially justified standard applies for an
attorney fees award against the EEOC.

III.  CONCLUSION
      The EEOC has presented sufficient direct evidence of age discrimination to
avoid summary judgment. By doing so, the EEOC was substantially justified in
bringing this ADEA case against the District, and attorney fees should not have been
awarded against it. Therefore, we reverse the district court’s grant of summary
judgment and vacate its award of attorney fees.



                                           -11-
A true copy.

      Attest:



         CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.




                          -12-
