Argued: December 7, 2016
from the United States District Court for the Eastern
District of Virginia, at Alexandria. T. S. Ellis, III, Senior
District Judge. (1:14-cv-01715-TSE-JFA)
Steven Cabana, LAW OFFICE OF ANDREW CABANA, PC, Alexandria,
Virginia, for Appellant.
James Stone, BARNES & THORNBURG LLP, Washington, D.C.,
Lynn Jakubowski, Washington, D.C., John F. Meyers, BARNES
& THORNBURG LLP, Atlanta, Georgia, for Appellee.
NIEMEYER, TRAXLER, and HARRIS, Circuit Judges.
TRAXLER, Circuit Judge
Waag brought an action alleging that his former employer,
Sotera Defense Solutions, Inc., violated the Family and
Medical Leave Act ("FMLA"), 29 U.S.C. § 2601
et seq., by not restoring Waag to his position when
he returned from two-months-plus of medical leave; by placing
him in a new job that was not equivalent to the one he held
before he went on leave; and by terminating Waag from the new
job because he took medical leave. The district court granted
summary judgment to Sotera, and Waag appeals. We affirm.
his employment with Sotera, Waag worked for Potomac Fusion,
Inc., reporting directly to Dan Haug. At Potomac Fusion, Waag
was "Senior Director of Operations, National
Intelligence Programs." J.A. 227. Waag's primary
duties at Potomac Fusion included "provid[ing] budgetary
guidance" and oversight for national security programs,
J.A. 74; developing standardized "program controls,
" J.A. 75; and "support[ing] business development
efforts to . . . grow the footprint of the firm, " J.A.
77, particularly in the area of modeling and simulation.
December 2011, Sotera, a defense contractor that provides
technology products and services to federal agencies,
acquired Potomac Fusion, which became Sotera's Data
Fusion Analytics ("DFA") division. Sotera installed
Haug as Vice President for the DFA division, and Waag
maintained the "Director of Operations" title he
had held at Potomac Fusion for Sotera's DFA division. At
the time of the acquisition, "key Potomac Fusion
employees" were identified and offered "retention
bonus agreements." J.A. 215. Despite his Senior Director
title, Waag "was not deemed critical to the strategic
growth of the company, " id., and therefore was
not identified as a key employee. Id. Waag's
duties at Sotera included oversight of issues related to
"recruiting, security, IT, and facilities." J.A.
79. Waag was also involved in the development of new business
at Sotera after the acquisition.
September 2012, the United States Army selected Sotera as one
of the nonexclusive prime contractors for the Software and
Systems Engineering Services Next Generation program
("SSES NexGen" or "NexGen" program) to
provide warfighting software solutions and support to the
Army at the Aberdeen Proving Ground in Maryland. NexGen was
an IDIQ contract-an "indefinite delivery/indefinite
quantity" contract. J.A. 668. A prime contractor has the
right to bid on "Requests for Proposals"
("RFPs") or "task orders" issued by a
federal department or agency under an IDIQ contract like
NexGen. Sotera was qualified to bid on RFPs in the area of
software and analytics. With a budgetary ceiling of $7
billion, the NexGen program was potentially very lucrative
for contractors who were awarded work, but Sotera still had
to out-bid other prime contractors to win a project under
NexGen. Thus, the NexGen program was worth nothing to Sotera
until it outbid other prime contractors for NexGen work.
early October 2012, Haug and Vice President Kathleen Lossau
asked Waag to become the Program Manager ("PM") of
Sotera's NexGen work in light of Waag's experience
managing IDIQ contracts. The PM position for an IDIQ contract
is largely "a marketing business development role,
" J.A. 101-02, particularly in the early stages. Thus,
Waag's salary was not directly billable to the
government-it was paid out of Sotera's overhead costs.
During Waag's brief tenure as PM, Sotera did not have any
work related to NexGen task orders, and Waag had no staff or
employees reporting to him on NexGen projects.
October 17, 2012, Waag severely injured his hand when he fell
off the roof of his house. Waag was hospitalized for several
days and then underwent two or three days of physical therapy
per week. Waag's physician anticipated he would not
return to work until December 31, 2012. Waag informed Haug
about his injury on the day it happened and explained that he
would not be able to work for an extended period of time due
to the severity of the injury. During his absence from work,
Waag was able to cover a portion of his salary by using
Sotera's "paid time off" and short-term
disability benefits. J.A. 121.
to Waag, Sotera never notified him of his rights to take
leave under FMLA. Sotera, however, gave its employees a
handbook containing its leave policies, and this information
was also accessible online. Sotera's leave policy
provides up to 12 weeks of unpaid family and medical leave
and states that, "with limited exceptions, an employee
who takes leave under this policy will be able to return to
the same job or a job with equivalent status, pay, benefits
and other employment terms." J.A. 170. When Waag began his employment, he
received a Kindle device onto which Sotera's leave and
other human resources policies were loaded.
he was on leave, Waag communicated with Sotera Vice-President
Lossau about NexGen. In late October 2012, Waag indicated he
was "severely limited in [his] ability to step out into
the SSES NEXGEN [Project Manager] role." J.A. 256. After
speaking with Waag and learning he would be out of work until
mid-December or early January 2013, Lossau told Haug, "I
need a new PM for SSES nexgen, " and asked for
Haug's input. J.A. 879. Shortly thereafter, Haug and
Lossau decided to place Devin Edwards, who was Director of
Mission Analytics and Collection, in charge of NexGen IDIQ
work. Haug told Edwards there was "nothing to do"
at the time Edwards took over because there were no pending
early November, Waag and Lossau corresponded via e-mail
regarding the NexGen PM position. Lossau explained that
"Devin has agreed to be the SSES NexGen PM and will get
things started for us" and asked Waag to "pass on
any info [he had] to Devin." J.A. 240. Waag asked what
his role in NexGen would be after he returned to work, noting
that Lossau's e-mail "reads like Devin will be your
full-time permanent SSES NEXGEN PM and not just a stop-gap
measure until I am able to return." J.A. 239. Lossau
responded that Waag should not "worry about [his]
position" and that "[f]or the purposes of getting
the team up and going with SSES NexGen we have to provide
some stability [and] Devin is that stability for now."
Id. Lossau encouraged Waag that "[a]ll will
work out, " and that "we will evaluate as we ease
you back into full time work when you are ready . . .
[T]ogether we [will] figure out what roles work best for all
involved." Id. But, she also told Waag that he
had "been in the business long enough to know that no
position is permanent." Id.
after Waag began his medical leave, federal budget
sequestration went into effect, resulting in substantial cuts
to federal spending. The effect of sequestration on defense
contractors was significant since funding was not readily
available for government contracts. One of the many programs
delayed was NexGen. Lossau and Edwards attended the
government's "kickoff meeting" for the NexGen
contractors at which the contractors learned that "there
was no funding available for the contracts." J.A. 251.
In 2012 and 2013, there were no NexGen RFPs for which Sotera
could submit a bid. During this period, the NexGen PM
position was not a full-time job; Edwards estimated that he
spent only ten to twenty percent of his time on his NexGen
December 2012, Haug told Waag that when he returned to work,
Waag would be reporting to a different supervisor, Jim
Gerard, to help grow Sotera's new Electronic Warfare
Program ("EWP") which involved modeling and
simulation work. Unlike the NexGen program, which had no RFPs
to bid on, the EWP unit was competing for a specific
contract. Gerard was tasked with winning an EWP Management
Trainer ("EWPMT") contract-"a 70 or 80 million
dollar single award contract." J.A. 96. Because of
Waag's experience in modeling and simulation, he was
assigned to work on the EWPMT proposal, which was "a
very complex pricing job." J.A. 141. Waag spent the
majority of his time in January 2013 working on the EWPMT
proposal, which was submitted in February 2013. The salary
for Waag's new position was identical to the salary for
the NexGen PM position he held before taking medical leave,
and, as before, Waag's salary was overhead as he was not
performing billable work in the EWP. According to Lossau,
Waag's new job "was an equivalent position" to
the NexGen PM job and provided Waag "concrete work to
perform." J.A. 252.
2012, "Sotera and [its] DFA Business Unit saw a drastic
decrease in work due to sequestration, " J.A. 217, and
Sotera missed its 2012 budget revenue goal "by $110
million, " J.A. 219. In February 2013, Haug "was
informed by senior management that [he] needed to cut [his
division's] overhead cost by $2.3 million and that the
only way to do that [was] to lay off employees." J.A.
219. Haug's DFA "business unit was especially under
pressure because it had the highest indirect costs and was
woefully underperforming on the revenue side."
Id. In choosing which employees in his unit to lay
off, Haug focused on employees who were not performing work
directly billable to the government and "who were
assigned to the less important strategic priorities."
Id. Haug determined that the EWP and modeling and
simulation groups were doing lower priority work than several
other groups in the DFA division. Thus, Waag, an overhead
employee not doing high priority work, was included in the
initial group of employees laid off in February 2013. During
2013, fourteen senior managers were either laid off or
resigned and were not replaced, and Waag's boss Gerard, a
vice president, was laid off after Sotera failed to win the
EWPMT contract. But Edwards, Waag's replacement for
NexGen PM, was not among those laid off. Even though Sotera
had no NexGen IDIQ work, Edwards was retained because he
"was critical to a number of other significant revenue