In the emotionally charged weeks and months after the Sept. 11 attacks, Zafar Hasan encountered a chill in the air at Foley & Lardner in Chicago, where he worked as an associate in the business law practice group.

Hasan, a Muslim of Indian descent, saw his billable hours drop sharply and started to receive critical performance reviews. A year later, he was fired.

He filed suit in 2004, claiming that Foley discriminated against him, in violation of Title VII, because he is a Muslim. The U.S. District Court for the Northern District of Illinois granted Foley’s motion for summary judgment in 2007, concluding that the associate failed to create a “convincing mosaic” of evidence that he was the victim of intentional discrimination.

But Hasan will get his day in court. In December, the 7th Circuit reversed the lower court decision and remanded the case for trial. In Hasan v. Foley & Lardner, the three-judge panel found the facts of the case required closer examination and that a reasonable jury could conclude Foley fired Hasan because he is a Muslim.

Foley, for example, changed its initial explanation of the firing, claiming first that the associate had performed poorly. When Hasan’s positive evaluations were produced, the firm said there hadn’t been enough work for him.

Legal experts say Foley, which has a prominent labor and employment practice, should have known better. The law firm notes on its Web site that its “premier litigators and nationally recognized attorneys” advise clients in areas including affirmative action, diversity, discrimination and harassment. A Foley spokesman didn’t return phone calls and e-mails seeking a comment.

“Should we be surprised that a large law firm (and a management-side labor firm to boot) may fall prey to the same HR mistakes as the employers whom they advise as clients?” blogged plaintiffs attorney Paul Mollica, a partner at Meites, Mulder, Mollica & Glink in Chicago. “Sometimes the shoemaker’s children go without shoes.”

Credibility Problem

Inconsistent testimony hurt Foley’s case, says Paul Secunda, an associate professor of law at Marquette Law School.

The 7th Circuit said Foley can’t avoid trial by claiming it fired Hasan for poor performance “when there is an issue of material fact as to whether this proffered reason is merely a pretext.” A reasonable jury could find that Foley’s alternative explanation–that it fired Hasan for lack of work–is pretextual as well, Judge Kenneth Francis Ripple wrote. Foley’s attorney admitted in oral arguments that the firm hadn’t fired other associates in the business law department for economic reasons. An internal memo claimed economic performance for 2002 was strong and showed profits per equity partner rising by 25 percent.

“A jury could reasonably infer that Foley partners directed work toward other, non-Muslim associates in the business law department as a pretext to fire him,” the court found.

Secunda says Foley’s alternative explanations hurt its credibility. “Why is the employer changing its reason? What is it hiding?” he says. “Maybe something else is going on.”

Extravagant Allegations

Other facts in the case are open to interpretation and require more detailed scrutiny, the 7th Circuit found. On the day of the terrorist attacks, for example, partner George Simon was quoted as saying of Muslims, “Those people don’t belong here … they should kick them all out,” according to the decision. Although the lower court dismissed this comment as evidence because Simon was not Hasan’s direct supervisor, the appeals court concluded one could infer that Simon “not only participated in the decision to fire Mr. Hasan but also may have instigated it.”

The case is noteworthy for the “extravagance of the allegations” and the context of the “pressure cooker atmosphere of 9/11,” Mollica added in an interview. One partner, for example, referred to Hasan’s firing as a “sand-nigger pile on.”

After the October 2002 decision to fire Hasan, Department Chair Edwin Mason e-mailed the news to the firm’s nationwide managing partner but said he wanted to discuss some background information by phone. In his deposition, Mason admitted he wanted to convey that Hasan was a Muslim who could potentially bring a claim against the firm. The district court interpreted this as evidence that the firm paid attention to equal employment laws. But the 7th Circuit noted that a jury could infer Mason was concerned about leaving a written record “precisely because he was worried that Foley had fired Mr. Hasan unlawfully.”

Hasan pointed to the treatment of two other Muslim associates as evidence of discrimination: Foley placed on probation and then transferred one, and it fired the other for an unspecified reason after Hasan’s firing. The lower court held that Foley’s treatment of other Muslims was irrelevant, but the appeals court noted that behavior directed at other employees in a protected group “is one type of circumstantial evidence that can support an inference of discrimination.”

“You would think when they went through a layoff, they would use best practices and do it by the book,” Secunda says. “But they did everything wrong.”