
Opinion issued March 10, 2011  














In The
Court of Appeals
For The
First District of Texas



NO. 01-08-00762-CV
__________

BAKER HUGHES OILFIELD OPERATIONS, INC., Appellant

V.

JAMES M. WILLIAMS, Appellee



On Appeal from the 152nd District Court
Harris County, Texas
Trial Court Cause No. 2004-03092



O P I N I O N
	Appellee, James M. Williams, has filed a motion for en banc reconsideration
from this Court's June 10, 2010 opinion.  In light of the motion, we withdraw our
opinion and judgment of June 10, 2010 and issue this opinion in its stead.  We
overrule the motion for reconsideration en banc as moot.  See Brookshire Brothers,
Inc. v. Smith, 176 S.W.3d 30, 33 (Tex. App.--Houston [1st Dist.] 2004, pet. denied)
(op. on reh'g) (noting that motion for en banc reconsideration becomes moot when
panel issues new opinion and judgment).
	Appellant, Baker Hughes Oilfield Operations, Inc. ("Baker Hughes"),
challenges the trial court's judgment entered, after a jury trial, in favor of appellee,
James M. Williams, in his suit against Baker Hughes for racial discrimination in
violation of the Texas Commission on Human Rights Act (the "Act"). (1)  In the first
four of its issues, Baker Hughes contends that the evidence is legally and factually
insufficient to support the jury's findings that race was a motivating factor in Baker
Hughes' decision to terminate Williams's employment.  In its fifth issue, Baker
Hughes contends that the compensatory damages award is excessive.  
	We reverse and render.   
Factual and Procedural Background
	In his petition, Williams, an African-American, alleged that he began working
as a machinist at a Baker Hughes facility in 1993.  On January 31, 2003, Gilbert
Schulz and Brian Fendley, two white supervisors in the fishing tools section in which
Williams worked, terminated his employment as part of an alleged larger pattern of
discharging all the black machinists in the fishing tools section and "replacing them
with Hispanic machinists."  According to Williams, Schulz and Fendley used "poor
performance" as "a mere pretext for the discriminatory termination" of his and the
other black machinists' employment, and Baker Hughes, because of his race, had
treated him less favorably in his employment, compared to other employees.
	At trial, Williams testified that he had worked at the same Baker Hughes
facility from 1993 to 2003 with a good employment history. (2)  In 2001, Baker Hughes
created at the facility the fishing tools section, in which tools used in offshore drilling
were manufactured.  Williams was assigned to this section, and the supervisors of the
section, Schulz and Fendley, reported to Lindsay Self, a production manager at the
facility who supervised all of the machinists and welders at the facility.  
	Williams acknowledged that in November 2002, he signed a document
circulated by his supervisors attesting that he would comply with, among other things,
Baker Hughes' manufacturing procedure "M01.090," which the parties also refer to
as an "ISO procedure."  The M01.090 procedure "define[d] the actions [to be] taken
when nonconforming product [was] detected in the manufacturing process," it applied
to all Baker Hughes manufacturing personnel, and it required operators to notify a
"supervisor" upon finding a nonconformance in a product.  Williams also
acknowledged that in January 2003, he violated the M01.090 procedure by failing to
notify his supervisors, Schulz and Fendley, when he discovered that he had milled a
nonconforming part.  Williams explained that he had received a work order to mill
a two-part tool from furnished materials, he made a conforming part from the
furnished materials when milling the first part of the tool, but he created a non-conforming part when milling the second part of the tool.  Williams knew at that time
that he had erred and created a nonconforming part, but rather than notify Schulz and
Fendley, he instead told Moises Banda, another machinist working in the fishing tools
section.  	
	After Williams told Banda that he had made a nonconforming part, Banda told
Williams to search the work station for another piece of material from which to mill
a replacement for the nonconforming part.  Williams then found another piece of
scrap material and, as suggested by Banda, milled the second part and sent the entire
tool through the manufacturing process.  In explaining how he had selected the scrap
material to use in remaking the second part, Williams noted that he matched the "heat
number" reflected on the blue print for the tool.  However, subsequent, undisputed
testimony revealed that this measure did not ensure that the scrap material was of the
same hardness and required specifications of the furnished material.  
	Williams further testified that it was common practice among machinists to go
to Banda if they had a problem because the machinists viewed Banda as a "leadman"
"to a degree," an "unknown leadman," or a "troubleshooter."  However, Williams
conceded that Banda was not an official Baker Hughes "leadman."  Moreover,
although Williams noted that the M01.090 procedure did not define the term
"supervisor," he admitted that he knew, and in fact "everybody knew," that Banda
was not a "supervisor," but was actually "just a machinist" like Williams.  Williams
agreed that no supervisor had given him permission to inform Banda, rather than a
supervisor, in the event that he detected a nonconforming part, and Banda had not
told Williams not to inform his supervisors about the nonconforming part.
	Approximately one week later, the two-part tool with the replacement part
milled by Williams was included among 10% of the parts tested by Baker Hughes'
inspection department, and the replacement part failed inspection.   The inspection
department determined that the replacement part made by Williams was only one-third to one-half of the hardness of the material specified in the tool's work order and
furnished to Williams.  Williams agreed that had this defect not been caught by Baker
Hughes in final inspection, the part could have caused a "dangerous" and "expensive"
tool failure on an offshore or onshore well.   When asked whether he had given any
consideration as to whether the scrap material that he had used to mill the
replacement part was of the same hardness as the material furnished to him, Williams
agreed that he "never gave it a second thought."  He conceded that it was not possible
to determine the hardness of the material that he used through visual inspection or
while he was machining it and that special instruments were required to actually
determine the hardness of the material. 
	After learning of the inspection results, Fendley, who was confused about how
the tool could have been made with inferior material, approached Williams to
determine if he knew what had happened.  Williams explained the sequence of events. 
The next morning, when Williams appeared for work, Fendley and Schulz met with
Williams and terminated his employment. (3)  During this meeting, Fendley told
Williams that his employment was being terminated because he milled a
nonconforming part and reported it to Banda rather than his supervisors.  
	Fendley also provided Williams with a copy of a form "Discipline Report," in
which in a section titled "Description of Violation," Fendley stated,
James Williams milled two parts and one of these parts was scrapped in
final inspection due to not passing a hardness check.  I asked James if
he knew anything about why there was a discrepancy between the two
parts.  He said he had messed up on one part, so he found replacement
material and milled another part without notifying a supervisor.  James
is a senior machinist and has read and signed off on ISO procedures.
The replacement material was not to BMS per print.  If this was not
found in inspection this would have caused a tool failure on the job. . . . 

In the "Recommended Corrective Action" portion of the report, Fendley wrote, "Due
to the severity of the violation, I am terminating [Williams's] employment effective
immediately 1/31/03."  Although it is not disputed that Williams had not previously
violated the M01.090 procedure, Fendley, in a section titled "Has Employee Received
Previous Warning," checked "Yes." After being given the opportunity to review and
comment on the report, Williams signed the report without making any additional
comments in the area allowed.   Fendley and Schulz also signed the report.  
	Williams testified that he had committed the conduct that served as the basis
for the termination of his employment and he deserved "some sort of discipline" for
his conduct, but he stated that he was shocked by the termination in light of his
"impeccable record" at Baker Hughes.  However, Williams agreed that he did not
know of any other employees at the Baker Hughes facility who had engaged in the
kind of conduct in which he had engaged and had not had their employment
terminated.  
	Williams did not present any direct evidence of discrimination.  Instead, he
attempted to present circumstantial evidence that Baker Hughes' reason for the
termination of his employment was false and a pretext for racial discrimination.  He
also attempted to establish that he was treated less favorably than non-black workers. 
For example, Williams introduced evidence showing that he and other machinists had
previously made nonconforming parts and their employment had not been terminated. 
Williams also highlighted that there was no Baker Hughes document expressly stating
that the conduct for which his employment had been terminated was conduct for
which Baker Hughes would actually terminate one's employment.  Moreover,
although he agreed that he had violated the M01.090 procedure and his violation
could have had an expensive and dangerous consequence, Williams asserted that he
and the other black machinists had been "eradicated" out of the fishing tools section
by Fendley and Schulz.  In support of this assertion, Williams presented evidence that
the employment of approximately four to five other black machinists in the fishing
tools section had been terminated during or shortly after his tenure at Baker Hughes
and these black machinists had received numerous disciplinary reports only after
Schulz and Fendley became supervisors in the fishing tools section.  Williams also
emphasized evidence that he had been replaced by a white machinist.     
	After hearing the evidence, the jury found that race was a motivating factor in
Baker Hughes' decision to discharge Williams and that Baker Hughes would not have
discharged Williams in the absence of this impermissible motivating factor.  The jury
awarded Williams back-pay of $145,000 and compensatory damages of $300,000.

Standard of Review
	We will sustain a legal sufficiency or "no-evidence" challenge if the record
shows one of the following: (1) a complete absence of evidence of a vital fact, (2)
rules of law or evidence bar the court from giving weight to the only evidence offered
to prove a vital fact, (3) the evidence offered to prove a vital fact is no more than a
scintilla, or (4) the evidence establishes conclusively the opposite of the vital fact.
City of Keller v. Wilson, 168 S.W.3d 802, 810 (Tex. 2005).  "More than a scintilla of
evidence exists where the evidence supporting the finding, as a whole, rises to a level
that would enable reasonable and fair-minded people to differ in their conclusions."
Tarrant Reg'l Water Dist. v. Gragg, 151 S.W.3d 546, 552 (Tex. 2004).  In conducting
a legal sufficiency review, a court must consider the evidence in the light most
favorable to the verdict and indulge every reasonable inference that would support
it, and "[a] reviewing court cannot substitute its judgment for that of the trier-of-fact,
so long as the evidence falls within this zone of reasonable disagreement."  City of
Keller, 168 S.W.3d at 822.  However, a fact finder may not, from meager
circumstantial evidence, reasonably infer an ultimate fact, none more probable than
another.  Hammerly Oaks, Inc. v. Edwards, 958 S.W.2d 387, 392 (Tex. 1997). This
Court has explained that under the law of evidence, the term "inference" means "a
truth or proposition drawn from another which is supposed or admitted to be true.  A
process of reasoning by which a fact or proposition sought to be established is
deduced as a logical consequence from other facts, or a state of facts, already
proved."  Marshall Field Stores, Inc. v. Gardiner, 859 S.W.2d 391, 400 (Tex. App.--
Houston [1st Dist.] 1993, writ dism'd w.o.j.) (quoting Black's Law Dictionary 700
(5th ed. 1979)).  Thus, to "infer" a fact, one "must be able to deduce that fact as a
logical consequence from other proven facts" and there must be a logical and rational
connection between the facts in evidence and the fact to be inferred.  United States
v. Michelena-Orovio, 702 F.2d 496, 504 (5th Cir.), aff'd on reh'g, 719 F.2d 738 (5th
Cir. 1983) (en banc).  Moreover, "[e]ven though the evidence is viewed in the light
most favorable to the verdict, it cannot be considered in isolated bits and pieces
divorced from its surroundings; it must be viewed in its proper context with other
evidence."  AutoZone, Inc. v. Reyes, 272 S.W.3d 588, 592 (Tex. 2008) (citing City of
Keller, 168 S.W.3d at 827).  "'[W]hen the evidence offered to prove a vital fact is so
weak as to do no more than create a mere surmise or suspicion of its existence, the
evidence is no more than a scintilla and, in legal effect, is no evidence.'"  Ford Motor
Co. v. Ridgway, 135 S.W.3d 598, 601 (Tex. 2004) (quoting Kindred v. Con/Chem,
Inc., 650 S.W.2d 61, 63 (Tex. 1983)). 
 Motivating Factor
	In its first issue, Baker Hughes argues that the evidence is legally insufficient
to support the jury's finding that race was a motivating factor in its decision to
terminate Williams's employment because Williams admitted to violating an
important manufacturing procedure, which was the reason for the termination;
admitted that he deserved to be disciplined for this potentially "dangerous" and
"expensive" violation; and failed to present any proof of disparate treatment or any
other evidence that race was a motivating factor in Baker Hughes' decision to
terminate his employment.  In response, Williams argues that the evidence is legally
sufficient to support the jury's verdict because he "substantially complied" with the
pertinent manufacturing procedure, Fendley and Schulz terminated the employment
of "all" of the black machinists in the fishing tools section, Williams had "received
harsher discipline than non-black employees," two non-black employees who
committed similar transgressions had their employment terminated only after having
received previous warnings, Baker Hughes' reasons for terminating Williams's
employment "wobbled" and were "rife with exaggerations," and Baker Hughes had
not informed employees that a violation of the M01.090 procedure could result in the
termination of employment.  
	Under the Act, an employer may not discriminate against or discharge an
employee based on "race, color, disability, religion, sex, national origin, or age." 
Tex. Lab. Code Ann. § 21.051 (Vernon 2006).  "By adopting the Act, the
Legislature intended to correlate state law with federal law in employment
discrimination cases."  AutoZone, Inc., 272 S.W.3d at 592 (citing Ysleta Indep. Sch.
Dist. v. Monarrez, 177 S.W.3d 915, 917 (Tex. 2005)); Wal-Mart Stores, Inc. v.
Canchola, 121 S.W.3d 735, 739 (Tex. 2003).  Therefore, we consider both federal
and state law in interpreting the Act's provisions.  Id.; Quantum Chem. Corp. v.
Toennies, 47 S.W.3d 473, 476 (Tex. 2001).  To establish a violation of the Act, a
plaintiff must show that he or she was (1) a member of a class protected by the Act,
(2) qualified for his or her employment position, (3) terminated by the employer, and
(4) treated less favorably than similarly situated members of the opposing class. 
AutoZone, Inc., 272 S.W.3d at 592; see Reeves v. Sanderson Plumbing Prods., Inc.,
530 U.S. 133, 142, 120 S. Ct. 2097, 2106 (2000).  Here, Williams bore the burden
of proving that race was a motivating factor in Baker Hughes' decision to terminate
his employment.  AutoZone, Inc., 272 S.W.3d at 592.
	Williams stresses that "[p]roving the employer's stated reason for the firing
is pretext is ordinarily sufficient to permit the trier of fact to find that the employer
was actually motivated by discrimination."  See Quantum Chem. Corp., 47 S.W.3d
at 481-82.  Williams also stresses that "it is permissible for the trier of fact to infer
the ultimate fact of discrimination from the falsity of the employer's explanation." 
 See Reeves, 530 U.S. at 147-148, 120 S. Ct. at 2108-09.  
	In Reeves, the United States Supreme Court explained that "[p]roof that the
defendant's explanation is unworthy of credence is simply one form of
circumstantial evidence that is probative of intentional discrimination," which "may
be quite persuasive" and, "[i]n appropriate circumstances, the trier of fact can
reasonably infer from the falsity of the explanation that the employer is dissembling
to cover up a discriminatory purpose."  Id. at 147, 120 S. Ct. at 2108 (emphasis
added).  Thus, "a plaintiff's prima facie case, combined with sufficient evidence to
find that the employer's asserted justification is false, may permit the trier of fact to
conclude that the employer unlawfully discriminated."  Id. at 148, 120 S. Ct. at 2109
(emphasis added).  However, the Supreme Court cited with approval its prior
holdings that "[i]t is not enough . . . to dis believe the employer; the factfinder must
believe the plaintiff's explanation of intentional discrimination."  Id. at 147, 120 S.
Ct. at 2108 (citing St. Mary's Honor Ctr. v. Hicks, 509 U.S. 502, 519, 113 S. Ct.
2742, 2754 (1993)).  Moreover, the Supreme Court rejected the suggestion that a
showing of falsity by the plaintiff would "always be adequate to sustain a jury's
finding of liability," and it recognized that "[c]ertainly there will be instances where,
although the plaintiff has established a prima facie case and set forth sufficient
evidence to reject the defendant's explanation, no rational factfinder could conclude
that the action was discriminatory."  Id. at 148, 120 S. Ct. at 2109.  For example, "an
employer would be entitled to judgment as a matter of law . . . if the plaintiff created
only a weak issue of fact as to whether the employer's reason was untrue and there
was abundant and uncontroverted independent evidence that no discrimination had
occurred."  Id.; see also Little v. Tex. Dep't of Criminal Justice, 177 S.W.3d 624, 632
(Tex. App.--Houston [1st Dist.] 2005, no pet.) (reviewing Reeves and stating that
Supreme Court "has made it clear that it is not sufficient merely to show that the
employer's reasons are false or not credible; the plaintiff must prove that the
employer discriminated intentionally").  Accordingly, "[w]hether judgment as a
matter of law is appropriate in any particular case will depend on a number of
factors," including "the strength of the plaintiff's prima facie case, the probative
value of the proof that the employer's explanation is false, and any other evidence
that supports the employer's case and that properly may be considered on a motion
for judgment as a matter of law."  Reeves, 530 U.S. at 148-149, 120 S. Ct. at 2109. 
	The Texas Supreme Court has cited, and followed, the principles set out in
Reeves.  See AutoZone, Inc., 272 S.W.3d 588; Ysleta Indep. Sch. Dist., 177 S.W.3d
915; Canchola, 121 S.W.3d 735; Quantum Chem. Corp., 47 S.W.3d 473.  Citing to
Reeves, the Texas Supreme Court has made clear that a plaintiff seeking to recover
under the Act for illegal discrimination in a case involving an allegation of pretext
must show both that the reason proffered by the employer is "'false, and that
discrimination was the real reason.'"  Canchola, 121 S.W.3d at 740 (quoting St.
Mary's Honor Ctr., 509 U.S. at 515, 113 S. Ct. at 2752).  That is, in a racial
discrimination case brought under the Act, even if the evidence could be sufficient
to support an implied finding that the reasons cited by the employer for the
employee's termination are false, the employee still bears "the ultimate burden" to
prove that the employer discriminated against him because of race.  See id. (citing
Reeves, 530 U.S. at 147-49, 120 S. Ct. at 2097).  Thus, "[t]he relevant inquiry" is not
whether the stated basis for termination is a pretext, but what the stated basis was "a
pretext for."  Id.
	We now turn to the evidence cited by Williams in support of his argument that
the jury could have believed that Baker Hughes' stated reason for the termination of
his employment was false and, based upon this falsity, could have reasonably
inferred discrimination.  First, Williams asserts that there is evidence that he
substantially complied with the M01.090 procedure, which required machinists, like
Williams, to report any nonconforming products that they detected to their
supervisor.  However, as noted above, Williams himself admitted that he had
violated the M01.090 procedure when, after discovering that he had milled a
nonconforming part, he notified another coworker machinist, rather than a
supervisor, and then milled a second part from scrap material that he obtained in a
non-controlled environment.  It is undisputed that the tool Williams subsequently
manufactured failed a hardness test because it was made with inferior material that
was only one-third to one-half of the hardness required by the specifications.
Furthermore, Williams's testimony conclusively establishes that he knew the identity
of his supervisors and that he knew Banda was not a supervisor.  Although Williams,
at trial, did testify that the term "supervisor" was not defined in the M01.090
procedure,  he unequivocally stated that "everyone knew" that Banda was not a
supervisor.  Although Williams characterized Banda as a "leadman" to "a degree,"
there is no evidence that Banda was a supervisor.  	
	Williams also admitted that his conduct, and his violation of the M01.090
procedure, could have had "expensive" and "dangerous" consequences, but for the
fact that the defective part was discovered in Baker Hughes' inspection process. 
Williams also agreed that he deserved to be disciplined for his conduct, although he
disputed the level of discipline ultimately imposed.  Moreover, the undisputed
evidence in the record also shows that no employee at the Baker Hughes' facility had
been found to have violated the M01.090 procedure but had not been terminated. 
In sum, even though Williams presented evidence that might allow a juror to
reasonably conclude that he, in good faith, had asked Banda how to proceed after he
had discovered that he had made a nonconforming part and that other machinists at
the Baker Hughes facility viewed Banda as an "unknown leadman" or a
"troubleshooter," there is no evidence that would have allowed a juror to reasonably
conclude that Williams substantially complied with the M01.090 procedure. 
Williams's admissions that he violated the M01.090 procedure and deserved to be
disciplined for the potentially dangerous and expensive consequence of the violation
is conclusive on the issue of compliance.
	Second, Williams asserts that Baker Hughes' reason for terminating his
employment "wobbled throughout the case."  Williams argues that Fendley's
testimony was contradictory because he first testified that Baker Hughes terminated
Williams's employment for failing to report a nonconforming part, but later testified
that his employment was terminated for milling a second part out of inferior, non-controlled replacement material that subsequently failed an inspection for hardness. 
Contrary to Williams's assertion, Fendley's testimony is not at all inconsistent, and
no reasonable juror could find these explanations to constitute "inconsistent
justifications."  The testimony was clear throughout the trial that Baker Hughes had
not terminated Williams's employment simply because he milled a nonconforming
part.  In fact, the evidence showed that Williams, and numerous other machinists,
had milled nonconforming parts in the past and their employment had not been
terminated.  Rather, the evidence was consistent that Baker Hughes terminated
Williams's employment because he violated the M01.090 procedure by failing to
notify his supervisors once he discovered the nonconforming part and then milling
a second replacement part out of inferior material.  Although Williams presented
evidence that he disagreed with the decision to terminate his employment, the
evidence reveals no legitimate discrepancies as to Baker Hughes' stated reason for
his termination.  At trial, Baker Hughes' stated reasons for the termination of
Williams's employment were consistent with the reasons detailed in the discipline
report, which Williams agrees he reviewed and signed on the date of the termination
of his employment. (4) 
	Third, Williams asserts that Baker Hughes' stated reason for termination of
his employment was not expressly disclosed in any of the written policies and Baker
Hughes did not comply with its own policies in terminating his employment.
Williams cites an exhibit that identifies certain "dischargeable offenses" and notes
that the list is "quite extensive." (5)  Williams also cites an exhibit that sets forth
disciplinary guidelines when machinists manufacture nonconforming parts. 
Williams emphasizes that the exhibit identifying the dischargeable offenses does not
"say or hint that an employee who fails to report a nonconformance to a supervisor
or makes a nonconforming part that is discovered during inspection may result in
immediate termination."  Williams also notes that the written M01.090 procedure did
not state that noncompliance would result in termination, and he cites his testimony
that he and other machinists had made nonconforming parts in the past and had not
had their employment terminated. However, the referenced exhibit makes clear that
the list of dischargeable offenses is not exhaustive and it notes that "serious
violations that may result in an employee's immediate discharge may include, but are
not limited to" the enumerated offenses.  In fact, expressly included in the list of
terminable offenses is "any serious breach" of Baker Hughes' policies, rules, or
regulations.  Baker Hughes also reserved the right to terminate employment for
serious breaches in other general employment documents introduced into evidence. 
We again note that Williams himself testified that his procedural violation and his
conduct in manufacturing a milled part from scavenged material could have led to
a "dangerous" and "expensive" tool failure had the defective part not been
discovered by others subsequently in the inspection process.   
	Additionally, Williams misses the point when he cites to evidence that Baker
Hughes had not, in the past, discharged employees merely for manufacturing
nonconforming parts and had furnished disciplinary guidelines that did not require
immediate discharge of employees who manufacture nonconforming parts.  This is
because, as set forth above, Baker Hughes' consistently stated reason for the
termination of Williams's employment was not the mere manufacturing of a
nonconforming part.  Williams did not simply mill a nonconforming part, which
machinists had done in the past without having their employment terminated. 
Rather, he had discovered that he had made a nonconforming part and then had
attempted to mill a replacement part with inferior, scavenged material without
notifying his supervisor in violation of the M01.090 procedure.  
	Fourth, Williams asserts that Baker Hughes exaggerated the potential
consequences that could have occurred if the replacement part manufactured by
Williams had not been discovered in inspection and, thus, the jury could have
inferred racial discrimination.  However, despite Williams's characterizations at trial
that Baker Hughes had grossly inflated the consequences that could have resulted if
the defective product had made it to an end user, the testimony provided by Fendley,
Schulz, and Self was consistent with Williams's own admissions that there could
have been "expensive" and "dangerous" consequences.  Fendley and Schulz
generally testified that Williams's conduct presented a "severe" and "serious"
violation that could have resulted in tool failure and could have had "safety" and
"environmental" implications.  Here, the fact that Baker Hughes did not furnish more
detailed evidence regarding the potential specific consequences would not have
enabled a reasonable juror to conclude that Baker Hughes' reason for terminating
Williams's employment was false and, thus, to infer that Baker Hughes' real reason
for the termination was racial discrimination.  In sum, none of Williams's asserted
concerns would allow a juror to reasonably conclude that Baker Hughes' reason for
terminating Williams's employment was false and was a pretext for racial
discrimination.
	Williams next asserts that racial discrimination can be inferred based upon
evidence that Fendley and Schulz terminated the employment of "all" the other black
machinists in the fishing tools section during, or shortly after, Williams's tenure in
the section.  At trial, Williams opined that five other black machinists in the fishing
tools section had been terminated by Fendley or Schulz: Al Daigle, Jesse Ross,
Andre White, Harold DeWalt, and Wesley Dickie.   First, there is no direct evidence
that the employment of these men was terminated for discriminatory reasons.  In fact,
there is nothing in the record to show that any of these men ever alleged or believed
that their employment was terminated for discriminatory reasons.  Neither side chose
to call any of these men to testify, and Williams did not introduce any evidence as
to why their employment was terminated or whether they would have agreed or
disagreed with Baker Hughes' reason for its decision, if any, to terminate their
employment.  In fact, on cross-examination, Williams conceded that he had no idea
as to whether Baker Hughes had legitimate nondiscriminatory reasons to terminate
the employment of these machinists.  
	In response to Williams's stated belief as to why Baker Hughes had terminated
the employment of these machinists, Baker Hughes introduced evidence that it had
not terminated Dickie's employment and he had actually resigned at some point after
Williams's employment had been terminated, it had terminated DeWalt's
employment because he had violated Baker Hughes' attendance policy, it had
terminated (for a second time) White's employment because of excessive
absenteeism, it had terminated Ross's employment because of issues regarding the
quality of his work, and it had terminated Daigle's employment because he had
committed various infractions. (6) 
	Williams further asserts that racial discrimination can be inferred based upon
evidence that he received harsher discipline than non-black employees.  "To prove
discrimination based on disparate discipline, 'the disciplined and undisciplined
employees' misconduct must be of 'comparable seriousness.'"  AutoZone, Inc., 272
S.W.3d at 594 (citing Ysleta Indep. Sch. Dist., 177 S.W.3d at 917).  "The situations
and conduct of the employees in question must be 'nearly identical.'"  Id.  (citing
Ysleta Indep. Sch. Dist., 177 S.W.3d at 917); see also Winters v. Chubb & Son, Inc.,
132 S.W.3d 568, 578 (Tex. App.--Houston [14th Dist.] 2004, no pet.); Kelley v.
Humble Indep. Sch. Dist., No. 01-05-00761-CV, 2007 WL 926505, at *8 (Tex.
App.--Houston [1st Dist.] Mar. 29, 2007, pet. denied) (mem. op.).  "Employees with
different responsibilities, supervisors, capabilities, work rule violations, or
disciplinary records are not considered to be 'nearly identical.'" AutoZone, Inc., 272
S.W.3d at 594 (citing Ysleta Indep. Sch. Dist., 177 S.W.3d at 917).  "The situations
and conduct of employees is not nearly identical 'when the difference between the
plaintiff's conduct and that of those alleged to be similarly situated accounts for the
difference in treatment received from the employer.'"  Id. (citing Wallace v.
Methodist Hosp. Sys., 271 F.3d 212, 221 (5th Cir. 2001)).
	In support of his claim of disparate treatment, Williams initially relies upon
a comparison with Danny Houge, a white welder supervised by Fendley.  At trial,
Williams introduced two disciplinary reports regarding Houge.  In the first report,
Houge was disciplined for violating shop procedure M01.050 by failing to identify
correct parts before welding, which required the parts to be reworked and resulted
in a "disruption in the work process," and for performing a weld that was not in
compliance with weld procedures, and Houge received a two day suspension for
these violations.  In the second report, Houge was again disciplined for violating
shop procedure M01.050, and he received a two-day suspension.  Williams argues
that both he and Houge were found to have violated "similar operating procedures,"
and, thus, "the jury was allowed to infer that because [Williams] received a harsher
penalty for a comparable offense than non-black employees committed,
discrimination was a reason for the disparity."  
	Williams also cites to evidence related to nine other non-black employees
supervised by Fendley or Schulz who Williams contends received less severe
discipline after committing conduct of "comparable seriousness." Williams cites
evidence that (1) Eliborio Villegas was suspended for three days for failing to
thoroughly inspect his work, resulting in the parts that he had manufactured being
scrapped upon inspection, (2) Richard Benitez was suspended for two days for
disregarding "core values" and supplying false information on a company record and
to a member of management, (3) Donny Doung was suspended for three days for
disregarding core values for working on a day without supervisor approval, (4)
Manuel Montanez was suspended for three days for violating procedure M01.050 by
failing to place identifying numbers on parts that he had manufactured, (5) Huan
Hong was suspended for two days for violating manufacturing procedure M01.050
by failing to stamp machined parts with his personal stamp resulting in parts being
scrapped, (6)  Jose Lopez was suspended for two days for "failure to have first article
inspection on multiple pc," (7) Joe Vidaurri was suspended for two days for violating
shop procedures by failing to get a first article inspection resulting in scrapped parts,
(8) Taun Tran was suspended for a safety violation for removing a "tag out" tag from
a machine when he was not authorized to do so, and (9) Archie Venezuela received
a written warning for violating unspecified shop procedures.
	However, none of Williams's evidence concerning the disciplinary treatment
of the other non-black employees involved conduct comparable to that committed
by Williams.  Specifically, none of the above employees were charged with violating
procedure M01.090 by failing to notify their supervisor upon detecting a
nonconforming part and none were found to have milled a replacement part from
non-controlled material of inferior quality.  
	Williams further relies upon Baker Hughes' evidence concerning its
termination of the employment of a white machinist, Michael Dillon, and a Hispanic
machinist, Nicolas Escutia, both of whom did not work in the fishing tools section,
but who had also violated the M01.090 procedure.  Williams argues that the jury
could have reasonably inferred that Baker Hughes' stated reason for the termination
of his employment was "not worthy of credence" because it "applied a different
decision-making standard" to Dillion and Escutia.  Referencing Baker Hughes' form
Discipline Report regarding Dillon, Williams asserts that Dillon, unlike himself, was
"given oral and written reprimands, and a suspension" before Baker Hughes
terminated his employment.  Referencing Baker Hughes' form  Discipline Report
regarding Escutia, Williams asserts that Baker Hughes terminated Escutia's
employment"after he twice, not once violated the same policy for which [Williams's]
employment was terminated."  He argues that Escutia's situation was "exceedingly
more egregious" "because he sought to hide scraps in addition to failing to report
them."
	A review of the Baker Hughes Discipline Report concerning Dillon does
reveal that prior to the termination of his employment on April 27, 2003, he had
received on "Feb. 22, week of Feb. 15th (Feb. 03)," oral and written warnings and
a suspension by Raymond Clotter.  Also, a review of the Baker Hughes Discipline
Report concerning Escutia does reveal that prior to the termination of his
employment on June 13, 2004, he had received on June 7, 2004, a written warning
by Jerry Vickery.  However, as pointed out by Baker Hughes, neither Discipline
Report explains why or for what infractions Dillon and Escutia had received
previous warnings.  And neither party presented testimony to explain the information
contained in the reports.  In fact, although it is not disputed that Williams had not
previously violated the M01.090 procedure, the Baker Hughes Discipline Report
regarding the termination of his employment reveals that Williams had received a
previous warning from Fendley for an infraction.  Without evidence explaining why
and for what infractions Dillon and Escutia had "received previous warnings," we
conclude that the jury, from the reports in evidence, could not have rationally
inferred that Baker Hughes applied a different disciplinary standard to Dillon and
Escutia than it applied to Williams.  Again, the term "inference" means "a truth or
proposition drawn from another which is supposed or admitted to be true" and "[a]
process of reasoning by which a fact or proposition sought to be established is
deduced as a logical consequence from other facts, or a state of facts, already
proved."  Marshall Field Stores, Inc., 859 S.W.2d at 400.  Moreover, Baker Hughes
introduced evidence that  Williams's conduct could have resulted in tool failure,
which even Williams admits could have had "dangerous" and "expensive"
consequences if the defect had not been discovered in inspection.  
	In sum, the evidence regarding the conduct and circumstances of Williams and
the non-black employees referenced above does not rise to the level that, when
viewed in the light most favorable to the judgment, a reasonable jury could find that
the conduct or the circumstances surrounding the conduct were "nearly identical" for
the purposes of establishing discrimination based upon disparate discipline. (7)
AutoZone, Inc., 272 S.W.3d at 594; see also Ysleta Indep. Sch. Dist., 177 S.W.3d at
917-18 (finding no evidence that misconduct was of "comparable seriousness");
Bryant v. Compass Group USA Inc., 413 F.3d 471, 478-79 (5th Cir. 2005) ("no
reasonable jury could conclude that the two events are 'nearly identical'").
	Finally, Williams argues that the jury could have reasonably inferred that race
was a motivating factor in Baker Hughes' decision to terminate his employment
because "turnover among black employees" at the Baker Hughes facility was high
or higher and Fendley's and Schulz's hiring practices suggested discrimination. In
support of his assertion that turnover was higher among black employees, Williams
cites a chart, which was prepared by Baker Hughes in response to an interrogatory,
detailing the race of all employees that Baker Hughes had employed in the fishing
tools section from January 1, 2000.  Of the 118 employees identified by Baker
Hughes, eighteen were black.  In addition to his general complaint regarding the lack
of diversity in the workforce, Williams notes that the Baker Hughes chart reflects
that, of the seven employees whose employment was terminated for performance,
four were black, two were Hispanic, and one was white.  Williams also states,
without any explanation, that Baker Hughes' fifty-six person management team was
all white at the time that his employment was terminated.   Moreover, Williams
suggests that because Fendley testified at trial that he had not hired any black
employees prior to his deposition but that he had hired a black employee after his
deposition, a jury could have inferred that this post-deposition hiring was simply
"window dressing" to cover up discriminatory hiring practices by Fendley and
Schulz.  
	However, as noted above, the only evidence in the record as to why the
employment of the four or five other black machinists ended was provided by Baker
Hughes.  There is no evidence, nor is there even an allegation from someone other
than Williams, that the employment of these machinists ended because of racial
discrimination.  Williams himself admitted that he lacked personal knowledge as to
how the employment of these machinists ended.  Although Williams opined that
these other black machinists were "eradicated" out of the fishing tools section, "[a]n
employee's own subjective belief of discrimination, no matter how genuine, cannot
serve as the basis for judicial relief."  Winters, 132 S.W.3d at 576.  Baker Hughes
was the only party to introduce evidence as to why the employment of these other
machinists ended, and Baker Hughes introduced evidence that the employment of
a number of non-black employees who had worked under the supervision of Schulz
and Fendley had been terminated for a variety of reasons, including poor
performance.  Additionally, there is no evidence in the record concerning the
diversity of the applicant pool for the Baker Hughes positions over which Fendley
had hiring authority, so the jury would not have been entitled to draw any inferences
from the fact that Fendley testified that he had not hired a black worker prior to his
deposition.  
	Moreover, there is no evidence as to how many hiring decisions Fendley had
himself made during this period, and Fendley testified that, other than certain
specialities for which he had hired, the remaining hiring decisions were made by a
Baker Hughes hiring manager. (8)  This hiring manager did not testify, and there is no
evidence distinguishing between hiring decisions made by Fendley and those made
by others at Baker Hughes.  Finally, based upon the record before us, we note that
no reasonable juror could infer that Baker Hughes was motivated by race in
terminating Williams's employment based upon evidence that Fendley had hired a
black employee during the pendency of Williams's lawsuit.  We recognize that
statistical evidence may be relevant in evaluating claims of racial discrimination in
some cases. See Quantum Chem. Corp., 47 S.W.3d at 482; DeCorte v. Jordan, 497
F.3d 433, 439 (5th Cir. 2007).  Here, however, we conclude that, to the extent the
evidence submitted by Williams can even be considered statistical evidence, the bare
evidence that four of the seven machinists in the fishing tools section who were
terminated for performance reasons were black cannot support Williams's claim of
racial discrimination.  See Baker v. Randstad North America, L.P., 151 Fed. App'x
314, 320 (5th Cir. 2005) (stating that "[a]lthough statistical evidence can be
probative of pretext, it is extraordinarily rare that raw numbers can insulate a
plaintiff from summary judgment" and that "[t]he probative value of statistical
evidence ultimately depends on all the surrounding facts, circumstances, and other
evidence of discrimination.").  In sum, a juror, in the absence of any other probative
evidence of racial discrimination, could not draw a reasonable inference of racial
discrimination based upon the limited record pertaining to these other black
machinists. 
	Accordingly, we hold that the evidence is legally insufficient to support the
jury's finding that race was a motivating factor in Baker Hughes' termination of
Williams's employment. 
	We sustain Baker Hughes' first issue.	
Conclusion

 Having held that the evidence is legally insufficient to support the jury's
verdict, we need not consider Baker Hughes' remaining issues.  We reverse the
judgment of the trial court and render a take nothing judgment in favor of Baker
Hughes.

							Terry Jennings
							Justice

Panel consists of Justices Jennings, Higley, and Sharp.

Justice Sharp, dissenting.
1. 	See Tex. Lab. Code Ann. §§ 21.001-.556 (Vernon 2006).
2. 	Schulz and Fendley agreed that Williams had a positive work history.
3. 	Fendley testified that he discussed the appropriate course of action with Schulz, an
unidentified human resources manager, Self, and Roger Hegel, the director of
manufacturing, and they all supported the termination recommendation.
4. 	In further effort to support his argument that Baker Hughes offered inconsistent
reasons for terminating his employment, Williams cites to a portion of a Baker
Hughes personnel status form in which it is noted that Williams was "discharged-performance."  Williams emphasizes this statement because Fendley and Schulz both
agreed that Williams had otherwise been a good employee and Fendley further agreed
that Williams's employment was not technically terminated for "performance," but
because of the severe and serious procedural violation in question.   However, in the
comments section of this form, it clearly states, "Employee discharged because of ISO
violation." Based upon this, no reasonable juror could have concluded from the
"performance" entry in this personnel form that Baker Hughes had offered
inconsistent justifications for its termination of Williams's employment.    
5. 	This list identifies dischargeable offenses to include, among other things, making
false statements on an employment application, willful destruction of property, theft,
falsifying time records, harassment, divulging confidential information, and
insubordination.   
6. 	Baker Hughes also introduced evidence that Fendely and Schulz had discharged
numerous other white and Hispanic employees under their supervision in the fishing
tools section.  Even Williams agreed that he was aware that Schulz and Fendley had
also fired at least two white employees in the fishing tools section during his tenure. 
Additionally, Baker Hughes introduced evidence that Fendley and Schulz supervised
numerous other black employees in the fishing tools section.  Fendley testified that
he and Schulz supervised at least eleven other black employees in the fishing tools
section, including one machinist, several of the black employees had been promoted,
and he had hired at least one black employee specifically for the fishing tools section
during the pendency of the lawsuit.  Fendley explained that many of these employees
had been employed in the fishing tools section since he was appointed supervisor.
Schulz also testified that both he and Fendley supervised numerous other black
employees who remained employed at the Baker Hughes facility.     
7. 	We also note that many of the discipline reports concerning the non-black employees
cited by Williams reflect that different decision-makers were involved in the
termination of many of these employees.  
8. 	Fendley testified that he had hired employees who worked on welding, grinding, and
heat operators, and that he had also hired some employees at job fairs, but that a hiring
manager hired all other employees.

