United States District Court, E.D. Pennsylvania
May 25, 2004.
KAREN LEE GAUL
ZEP MANUFACTURING COMPANY, et al.
The opinion of the court was delivered by: HERBERT HUTTON, District Judge
MEMORANDUM AND ORDER
Presently before the Court are Defendant Acuity Specialty Products
Group, Inc.'s d/b/a Zep Manufacturing Company Motion for Summary Judgment
(Docket No. 40) and Plaintiff Karen Lee Gaul's response thereto (Docket
This suit concerns the alleged discriminatory employment actions
against Karen Lee Gaul ("Gaul") by Acuity Specialty Products Group, Inc.
d/b/a Zep Manufacturing Company ("Zep") and National Service Industries,
A. National Service Industries, Inc.
NSI is a corporation formed in Delaware and maintains its principal
place of business in Georgia. From the start of Gaul's employment with
Zep in August of 1994 until 1996, NSI was qualified to do business in
Pennsylvania and Zep was a wholly-owned subsidiary of NSI.
In 1996 NSI was restructured. As part of its corporate restructuring, NSI withdrew as a corporation qualified to do
business in Pennsylvania. It transferred all of its interest in Zep to a
new subsidiary named National Service Industries, Inc., a company
incorporated in Georgia with is principal place of business in Georgia
("NSI-Georgia"). As a result, Zep became a subsidiary of NSI-Georgia
which in turn was a wholly owned subsidiary of NSI.
In August 2001 NSI underwent another corporate restructuring. NSI spun
off a number of companies, including Zep, into a new corporation known as
Acuity Specialty Products Group, Inc. ("Acuity"). According to NSI, Zep
is a wholly owned subsidiary of Acuity since September 1, 2001.
Additionally, on November 15, 2001, NSI-Georgia ceased to exist and
withdrew is qualification to do business in Pennsylvania.
B. Gaul's Employment with Zep
Zep is a manufacturer and supplier of industrial and institutional
maintenance and sanitation products. On August 22, 1994, Gaul was hired
as a sales representative for Zep's Philadelphia branch under the
supervision of Joseph Rotondi ("Rotondi"). Gaul performed well during
her first year and received the 1995 "Rookie of the Year" award for
having the highest sales of any first-year representative in Zep's
mid-Atlantic region. In April 1995 Gaul was given the additional
responsibility of working as a Field Coach for other sales
representative. In 1996 Gaul was promoted to Accelerated Field Sales
Manager, a position which included both sales and management duties.
Gaul made it to clear to her supervisors that she was interested in
advancing to the position of Branch Sales Manager ("BSM"). According to
Gaul, at the time of her eligibility to become a BSM, Rotondi repeatedly
requested for Gaul to be promoted but those requests were denied by two
of Zep's vice-presidents, Bill Buchman ("Buchman") and Alien Soden
("Soden"). In denying her the promotion, Soden allegedly stated that
"women attract the wrong kind of candidates and will not make good
managers." Joseph Rotondi Aff. ¶ 13 (Docket No. 52, Ex. 3). When Gaul
asked Buchman why she was not being promoted, Buchman allegedly said,
"When are you going to give up this craziness, and just get barefoot and
pregnant?" Karen Gaul Aff. ¶ 58 (Docket No. 52, Ex. 2).
In June 1998 Gaul was finally promoted to BSM of Zep's Philadelphia
branch. As BSM Gaul's responsibilities included (1) hiring, training,
retaining and developing new sales representatives; (2) working with and
developing veteran sales representatives; (3) working with sales
representatives in the field; (4) helping representatives increase their
sales; and (5) developing the members of her team into future managers.
Based on Gaul's performance as a BSM for fiscal year ("FY") 1999, she
received the National Branch Sales Manager of the Year award.*fn2
In the spring of 1999, Zep had an opening for a District Sales Manager ("DSM") for the mid-Atlantic District, which encompasses
the Philadelphia and Washington, D.C. branches. Gaul expressed an
interest in the position to Richard Reisig ("Reisig"), the Division Sales
Manager for the Northeast Division. Reisig allegedly responded by asking
her why she did not stay home and have kids and just be a sales
representative without management responsibilities. Reisig interviewed
male employees for the DSM position in an office setting. In contrast, he
interviewed Gaul in a car while she drove him to New Jersey.
In July 1999, Ethan Powers ("Powers") was promoted to the DSM position
and became Gaul's direct supervisor. According to Powers, Gaul's primary
responsibility was to grow the sales revenues of the Philadelphia branch
by hiring, training, and developing new sales representatives, and
helping veteran representatives grow their business. Gaul was also
responsible for the performance of all the sales representatives in
Philadelphia, including those who did not report directly to her.
In December of 2000, Gaul received her performance review for FY 2000.
Gaul received a rating of "Exceeds Expectations" for achieving the sales
representatives headcount goal, "Meets Expectations" for increasing
revenue by 6% for the second six months of the fiscal year, and "Below
Expectations" for not meeting the Branch sales revenue goals. Overall,
Gaul was rated as "Meets Expectations." As a result, Powers gave Gaul a
3% raise. According to Zep, Gaul's performance weakened in the following months.
Specifically, sales revenues for the Branch were below target every month
and Gaul was not hiring additional sales representatives nor spending
enough time in the field with the representatives. Powers contends that
he met with Gaul several times during the spring of 2001 to discuss the
Philadelphia branch's lagging revenues and the lack of new sales
representative hired. Gaul then allegedly inquired about returning to a
sales representative position because she felt it would allow her to
spend more time with her terminally ill husband.
According to Gaul, in the spring of 2001, Powers told her to hold off
on hiring new sales representatives until July because of budget
concerns. Gaul also disputes that she received any verbal warning about
her performance and maintains that Powers in fact assured Gaul that she
was doing well. Moreover, Gaul contends that she merely inquired about
the possibility of taking on a different job in the event she needed to
work fewer hours. Gaul denies that she told Powers she wanted to return
to the sales representative position. At the same time, Gaul spoke with
James Logan ("Logan"), Direction of Human Resources and Labor Relations,
to relate her concerns that Reisig may be treating her differently
because she was a woman.
Gaul was demoted on August 29, 2001 to the position of Field Sales
Manager ("FSM"). William Aimis ("Aimis") replaced Gaul in the BSM position. According to Zep, Powers decided to demote Gaul
based on (1) her failure to meet the Philadelphia Branch's sales revenue
and profitability targets for two consecutive fiscal years and (2) Gaul's
failure to fulfill expectations with respect to hiring, retaining, and
developing new sales representatives. On August 30, 2001, Gaul received a
memorandum from Powers in which he stated that the reason for her
demotion was because of the sales results for fiscal year 2001. No other
factors were mentioned.
Gaul believes that the decision to demote her was made jointly by
Powers, Reisig, Logan, James Piva, Northeast Division Operations Manager,
and Sam Daniels, the most senior sales executive at the time. Gaul notes
that while Zep had a policy of warning employees about their poor
performance prior to taking an adverse action, Gaul was demoted without
warning and without a chance to improve.
On September 6, 2001, Gaul turned down the FSM position and asked to be
reclassified as a sales representative. On September 12, 2001, Gaul
received a memorandum from Powers regarding her compensation for the
sales representative position. Unlike the initial offer of employment for
the FSM position, the memorandum specifically required Gaul to sign a
release waiving any claims arising out of her employment with Zep. Gaul
refused to sign the release after consulting with her attorney. On
September 27, 2001, Gaul received a letter from Logan. The letter stated
that if Gaul failed to report to work on October 1, 2001, Zep will take
the position that Gaul no longer wished to work for the company. Gaul
reported to work on that day but was told to return home after she
refused to sign the September 12, 2001 employment agreement.
From September 2001 to November 2001, Gaul believed she was no longer
employed by Zep and was therefore entitled to three months of severance
pay according to her 1998 BSM Employment Agreement. She also filed for
unemployment compensation. Zep initially maintained that Gaul was not
entitled to the severance pay because she was demoted, and not
terminated. Zep later revised its position and paid Gaul the three
months' severance pay. Additionally, after learning that Gaul filed for
unemployment compensation, Logan wrote to the Unemployment Bureau
accusing Gaul of fraud. He later stated that he had been "overzealous. "
Gaul in turn withdrew her claim for unemployment once she was paid.
On November 26, 2001, Gaul filed a charge of gender discrimination with
the Pennsylvania Human Rights Commission ("PHRC").
On December 1, 2001, Gaul signed a Sales Representative's Exclusive
Account Agreement with Zep and returned to work as a sales representative
in the Philadelphia branch on December 10. The Agreement required Gaul to
sell $50,000 after six months, $75,000 after nine months, and $100,000
after one year in exchange for receiving a minimum monthly compensation
of $6400 for one year. In comparison, other new representatives at Zep
were required to sell $28,000 in their first six months. During the next few months,
Gaul failed to meet her established sales goals. Gaul alleges that she
did not receive any business leads or book of business, even though
substantial business was given to male employees who had been demoted.
Gaul also alleges that she did not receive any sales support from Aimis,
her supervisor. On August 26, 2002, Powers decided to stop paying Gaul
her minimum monthly compensation and instead paid her a weekly draw of
$275 against her commission, which was subsequently raised to $400 per
week. Taken together, Gaul alleges that these actions constitute
retaliation for filing her complaint with the PHRC.
C. Procedural History
On March 6, 2003, the Equal Employment Opportunity Commission ("EEOC")
issued a Notice of Right to Sue letter to Gaul. Gaul filed suit on April
23, 2003. In Counts I and III, Gaul asserts a claim of gender
discrimination and retaliation under Title VII of the Civil Rights Act of
1964 ("Title VII"), 42 U.S.C. § 2000 (e) et seq., and the
Pennsylvania Human Relations Act ("PHRA"), 43 Pa. Cons. Stat. Ann. §
951 et seq., respectively. In Count II, Gaul asserts a claim
under the Equal Pay Act ("EPA"), 29 U.S.C. § 206. Lastly, in Count
IV, Gaul brings a claim for breach of contract.
On January 30, 2004, this Court issued a Memorandum and Order
dismissing Plaintiff's failure to promote claims under Title VII and the
PHRA as time-barred and dismissing Plaintiff's failure to promote claim as an EPA violation. See Gaul v. Zep Mfg.
Co., No. 03-2439, 2004 WL 234370 (E.D. Pa. Jan. 30, 2004). Zep now
moves for summary judgment as to Gaul's remaining claims.
II. LEGAL STANDARD
Summary judgment is appropriate "if the pleadings, depositions, answers
to interrogatories, and admissions on file, together with the affidavits,
if any, show that there is no genuine issue as to any material fact and
that the moving party is entitled to a judgment as a matter of law." Fed.
R. Civ. P. 56(c). The party moving for summary judgment has the initial
burden of showing the basis for its motion. See Celotex
Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the movant
adequately supports its motion pursuant to Rule 56(c), the burden shifts
to the nonmoving party to go beyond the mere pleadings and present
evidence through affidavits, depositions, or admissions on file showing a
genuine issue of material fact for trial. See id. at 324. The
substantive law determines which facts are material. See Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). If the evidence is
such that a reasonable jury could return a verdict for the nonmoving
party, then there is a genuine issue of material fact. See id.
When deciding a motion for summary judgment, all reasonable inferences
are drawn in the light most favorable to the non-moving party. See
Big Apple BMW, Inc. v. BMW of N. Am., Inc., 974 F.2d 1358, 1363 (3d
Cir. 1992), cert. denied, 507 U.S. 912 (1993). Moreover, a court may not consider the credibility or weight of the
evidence in deciding a motion for summary judgment, even if the quantity
of the moving party's evidence far outweighs that of its opponent.
See id. Nonetheless, a party opposing summary judgment must do
more than just rest upon mere allegations, general denials, or vague
statements. See Trap Rock Indus., Inc. v. Local 825,
982 F.2d 884, 890 (3d Cir. 1992).
III. JURISDICTION OVER NSI
First, NSI contests this Court's jurisdiction over it.
A district court may assert jurisdiction over a nonresident defendant,
such as the parent corporation, to the extent allowable under the due
process clause of the United States Constitution and the law of the state
in which the court sits. See Fed.R. Cvi. P. 4(e);
International Shoe Co. v. Washington, 326 U.S. 310, 316-17
(1940). Due process requires that the defendant have "minimum contacts"
within the forum state such that the exercise of jurisdiction comports
with "traditional notions of fair play and substantial justice."
Remick v. Manfredy, 238 F.3d 248, 255 (3d Cir. 2001) (quoting
International Shoe, 326 U.S. at 316).
The exercise of jurisdiction can satisfy due process on one of two
distinct theories, a defendant's general or claim-specific contacts with
the forum. See Helicopteros Nacionales de Colombia v. Hall,
466 U.S. 408, 414 n.8-9 (1984). A defendant is subject to general
jurisdiction when it has continuous and systematic contacts with the forum state and exists even if the plaintiff's cause of
action arises from the defendant's non-forum related activities. See
Helicopteros, 466 U.S. at 414-16; Vetrotex Certainteed Corp. v.
Consolidated Fiber Glass Products Co., 75 F.3d 147, 151 n.3 (3d Cir.
1996). Specific jurisdiction is established when a non-resident
defendant has "purposefully directed" his activities at a resident of the
forum and the injury arises from or is related to those activities.
General Electric Company v. Deutz Ag, 270 F.3d 144, 151 (3d
Cir. 2001). Questions of specific jurisdiction are properly tied to the
particular claims asserted and thus specific jurisdiction frequently
depends on physical contacts with the forum. See id. Thus,
where the plaintiff has shown that the defendant has the requisite
minimum contacts with the forum state and that the exercise of personal
jurisdiction would comport with traditional notions of fair play and
substantial justice, the constitutional due process standards underlying
specific jurisdiction are satisfied. See, e.g., Lautman v. Loewen
Group, Inc., No. 99-75, 2000 WL 772818 (E.D. Pa. June 15, 2000).
A foreign corporation is not subject to a forum state's jurisdiction
merely because it owns stock in a subsidiary doing business within the
state. See Ames v. Whitman's Chocolates, No. 91-3271, 1991 WL
281798, at *3 (E.D. Pa. Dec. 30, 1991). General jurisdiction does exist
when the parent corporation exercises such a degree of control that (1)
the subsidiary is its alter ego or agent; (2) the subsidiary is its mere instrumentality; or (3) the
corporations function as one integrated enterprise. See
id.; Lucas v. Gulf and Western Indus., Inc.,
666 F.2d 800 (3d Cir. 1981).
Here, Gaul seeks to invoke jurisdiction over NSI on the ground that NSI
represented itself to be Gaul's employer until November 15, 2001. Gaul
notes that (1) NSI was listed as the employer on the W-2 form issued to
Gaul from 1994 to 2001; (2) Zep was described as a division of NSI in
Gaul's 1998 BSM Employment Agreement; and (3) NSI issued the paychecks to
Zep employees until November 2001. Furthermore, Zep was a wholly owned
subsidiary of NSI until its spin-off in late 2001. As such, Gaul argues
that there is sufficient contact for the Court to assert jurisdiction
over NSI. The Court disagrees. Gaul has not presented any evidence that
Zep is the alter ego or instrumentality of NSI nor any evidence that the
two companies function as one integrated enterprise. Accordingly, the
Court concludes that it cannot exercise jurisdiction over NSI.
Even assuming that this Court can exercise jurisdiction over NSI, the
Third Circuit Court of Appeals has held that a parent corporation is not
liable for the employment decisions of a wholly owned subsidiary when
there is no evidence that the parent and subsidiary are "so interrelated
and integrated" to justify piercing the corporate veil. Marzano v.
Computer Science Corp., Inc., 91 F.3d 497, 514 (3d Cir. 1996). In
Marzano, a female employee brought suit against her former employer and its parent company,
alleging employment discrimination. The plaintiff argued that the parent
company should be held liable because (1) she was initially hired by the
parent and always believed she was employed by the parent; (2) there were
no apparent changes in management when the division for which she
initially worked merged with another subsidiary; (3) she received
paychecks from the parent for some time and belonged to the parent's
pension plan; (4) the policy at issue in the suit was based on one
promulgated by the parent; and (5) she was regularly involved with the
corporate parent while employed at the subsidiary. See Marzano,
91 F.3d at 513-14. The Third Circuit concluded that these facts, "taken
together, do not demonstrate that [the subsidiary and its parent] were so
interrelated and integrated in their activities, labor relations and
management that we should pierce the corporate veil." Id. at
514. The Court dismissed the charges against the parent company.
Similarly, Gaul has not presented sufficient evidence demonstrating
that Zep and NSI were so "interrelated and integrated in their
activities." At all times, Gaul was employed by Zep and, beyond receiving
paychecks and W-2 forms from NSI, was not regularly involved with NSI.
Accordingly, the Court dismisses the charges against NSI. IV. COUNTS I AND III: TITLE VII AND PHRA
Plaintiff asserts she was demoted from the BSM position because of her
gender. She also asserts a retaliation claim. Each claim will be
discussed in turn.
A. Gender Discrimination
Title VII prohibits an employer from discriminating against any
individual on the basis of race, color, religion, sex, or national
origin. See 42 U.S.C. § 2000e-2(a). To prevail on a Title
VII claim, a plaintiff must present evidence of discrimination using the
burden-shifting analysis of McDonnell-Douglas Corp. v. Green,
411 U.S. 792 (1973); see also St. Mary's Honor Center v. Hicks,
509 U.S. 502 (1993); Texas Dep't of Cmty. Affairs v. Burdine,
450 U.S. 248 (1981). First, the plaintiff must establish a prima facie
case of discrimination. See Burdine, 450 U.S. at 252-53.
1. Prima Facie Case
A prima facie case of discrimination under Title VII requires proof
that (1) the plaintiff belongs to a protected class; (2) she was
qualified for the position she lost; (3) she was subjected to an adverse
employment action despite being qualified; and (4) this action occurred
under circumstances giving rise to an inference of unlawful
discrimination, such as might occur when a similarly situated person not of the protected class is treated more
favorably. See Sarullo v. United States Postal Service,
352 F.3d 789, 797 (3d Cir. 2003); Williams-McCoy v. Starz Encore
Group, No. 02-5125, 2004 U.S. Dist. LEXIS 2600 at *11 (E.D. Pa. Feb.
5, 2004). The plaintiff's burden to establish a prima facie case is not
intended to be "onerous." Simpson v. Kay Jewelers,
142 F.3d 639, 646 (3d Cir. 1998).
It is uncontested for purposes of this motion that Gaul fulfills prongs
one and three the prima facie case. Zep asserts that Gaul cannot
establish a prima facie case because she was not qualified for the BSM
position and the circumstances of her demotion do not give rise to an
inference of unlawful discrimination.
a. Job Qualification
Courts rely on an objective standard to determine if a plaintiff is
"qualified" for the purposes of a prima facie discrimination claim.
See Goosby, 228 F.3d at 320; Sempier v. Johnson &
Higgins, 45 F.3d 724, 729 (3d Cir. 1995) (citing Weldon v.
Kraft, Inc., 896 F.2d 793, 798 (3d Cir. 1990));
Williams-McCov, 2004 WL 356198, at *4. Subjective factors such
as leadership or management skills are better left to consideration of
whether the employer's nondiscriminatory reason for discharge is
pretextual. See Sempier, 45 F.3d at 729.
Zep maintains that Gaul was not qualified for the position of Branch Sales Manager. Specifically, Zep argues that for FY 2000 and
FY 2001, Gaul did not meet her sales revenue and profitability goals nor
did she meet her hiring goals. However, the record indicates that Gaul
received an award for National BSM of the Year for FY 1999 and that she
received an overall rating of "Meets Expectations" during her FY 2000
performance review, with an "Exceeds Expectations" rating for the sales
representatives headcount. Further, in the spring of 2001, Powers
allegedly told Gaul to hold off on hiring sales representatives until
July 2001 because of budgetary concerns and assured her that she was
doing "real well." Moreover, Gaul's decision on how much time to spend on
the field with her sales representatives reflects upon her management
skills. Thus, taking all inferences in favor of the non-movant, the Court
finds for the purposes of the prima facie case that Gaul was qualified
for the BSM position.
b. Inference of Unlawful Discrimination
To establish the fourth element of a prima facie case of
discrimination, the Third Circuit has held that a plaintiff need not
prove that other employees outside the protected class were treated more
favorably. See Pivirotto v. Innovative Sys. Inc., 191 F.3d 344,
353 (3d Cir. 1999). Rather, the plaintiff must offer "evidence adequate
to create an inference" of unlawful discrimination in employment.
Id. at 355.
Here, Gaul contends that she was treated less favorably than Stuart Chaires ("Chaires"), the BSM of Washington, D.C., and
William Aimis, Gaul's replacement. Chaires was hired by Powers in
February 2000. At the time of her demotion, Chaires had never met his
sales revenue and profitability goals nor his hiring goals. However,
despite his comparatively weaker performance, Chaires was not demoted in
the fall of 2001. Further, for the first two years since Aimis replaced
Gaul, Aimis did not meet his sales revenue and profitability goals
either. Although proof of differential treatment of "a single member of
the non-protected class is insufficient to give rise to an inference of
discrimination" at the pretext stage, "such an inference may be
acceptable at the prima facie stage of the analysis." Simpson,
142 F.3d at 646. Thus, the Court concludes that Gaul has presented
sufficient evidence to create an inference of unlawful discrimination.
Accordingly, Gaul has established a prima facie case of gender
2. Defendant's Legitimate Non-Discriminatory
If the plaintiff can establish a prima facie case of discrimination,
the burden of production shifts to the defendant to articulate some
legitimate nondiscriminatory reason for the adverse employment action.
See Burdine, 450 U.S. at 253 (quoting
McDonnell-Douglas). Here, Zep's articulated nondiscriminatory
reason for demoting Gaul is her poor performance as a BSM.
Because the defendant has met its burden of production under the McDonnell-Douglas framework, the plaintiff must
establish that the legitimate reasons offered by the defendant were
merely pretext for gender discrimination, and not the real motivation
behind the unfavorable job action. See id. To do this, the
plaintiff must submit evidence sufficient for a factfinder to "either (1)
disbelieve the employer's articulated legitimate reasons; or (2) believe
that an invidious discriminatory reason was more likely than not a
motivating or determinative cause of the employer's action." Keller
v. Orix Credit Alliance, Inc., 130 F.3d 1101, 1108 (3d Cir. 1997)
(quoting Fuentes v. Perskie, 32 F.3d 759, 763 (3d Cir. 1994)).
To establish pretext under the first approach, a plaintiff must
demonstrate such "weaknesses, implausibilities, inconsistencies,
incoherencies, or contradictions in the employer's proffered legitimate
reasons for its action that a reasonable factfinder could rationally find
them unworthy of credence." Fuentes, 32 F.3d at 765.
Viewing the facts in the light most favorable to the plaintiff, Gaul
has raised sufficient issues of material fact to defeat Zep's summary
judgment motion. First, at the time of her demotion, Gaul was the only
female BSM at Zep and she was demoted while Chaires, a less successful
male BSM, was not demoted. Next, while Zep typically provided other BSMs
with written warnings regarding their performance, Gaul received no
written warning about her performance nor was she given a chance to
improve her performance. Moreover, Gaul disputes Zep's contention that she
received several verbal warnings about her performance as BSM. Finally,
Gaul contends the decision to demote her was made by Powers and other
members of Zep's management, including Reisig, who had originally
questioned Gaul's ambition and who allegedly did not properly recognize
Gaul's contributions. Taken together, Gaul has raised sufficient
questions such that a reasonable factfinder could disbelieve Zep's
articulated legitimate reason. Accordingly, summary judgment is denied as
to Gaul's Title VII gender discrimination claim.
Title VII also prohibits retaliation against employees who engage in a
protected activity such as stating a claim of discrimination.
See 42 U.S.C. § 2000e-3(a); Durham Life Ins. Co. v.
Evans, 166 F.3d 139, 157 (3d Cir. 1999). Where, as here, the
plaintiff relies on indirect evidence of discrimination, the
burden-shifting analysis of McDonnell-Douglas applies. See
Walden v. Georgia-Pacific Corp., 126 F.3d 506, 512 (3d Cir. 1997);
Hartman v. Sterling, Inc., No. 01-2630, 2003 WL 22358548, at *8
(E.D. Pa. Sept. 10, 2003). To establish a prima facie case of retaliation
under Title VII, a plaintiff must demonstrate that (1) she engaged in
activity protected by Title VII; (2) the employer took an adverse
employment action against her after or contemporaneous with the protected
activity; and (3) there was a causal connection between her participation in the protected activity and the adverse
employment action. See Weston v. Pennsylvania, 251 F.3d 420,
430 (3d Cir. 2001).
Informal protests of discriminatory employment practices, including
making complaints to management, qualify as protected activity under
Title VII. See Hartman, 2003 WL 22358548, at *8. Thus Gaul
first engaged in protected activity when she alerted Logan in May of 2001
that she believed Reisig "ha[d] a problem with [her] because [she] was a
woman." Karen Gaul Dep. at 379 (Docket No. 52, Ex. 4).
Retaliatory conduct constitutes "adverse employment action" if it
"alters the employee's compensation, terms, conditions, or privileges of
employment, deprives him or her of employment opportunities, or adversely
affects his [or her] status as an employee." Robinson v. City of
Pittsburgh, 120 F.3d 1286, 1300 (3d Cir. 1997). The Third Circuit
has also emphasized that courts should not analyze the employer's
individual acts in isolation, but rather should examine the acts
collectively in determining whether an adverse employment action
occurred. See Shaner v. Synthes (USA), 204 F.3d 494, 503 n.9
(3d Cir. 2000). Here, Gaul has raised a genuine issue of fact that
adverse actions were taken against her after or contemporaneously with
the protected activity. After her demotion but before she returned to Zep
in December 2001, Gaul points out that the initial demotion to the FSM
position came with no strings attached while the subsequent offer for the sales
representative position required her to sign a release. Gaul was told
that she was not entitled to severance pay and was accused of engaging in
fraud with the Pennsylvania Unemployment Bureau. Gaul also notes that
after reporting to work on October 1, 2001, as directed by Logan, she was
then told to go home. After Gaul started working as a sales
representative, Gaul alleges that she was given unrealistic sales goals.
Specifically, she was required to sell $50,000 of Zep products after six
months whereas other new sales representatives were required to sell only
$28,000. Gaul also alleges that she failed to receive any sales support
from Aimis. Finally, Gaul alleges that she was not given business leads
until December 2002, even after consistently asking for them and even
though substantial business was given to male employees who had been
demoted. Viewing all the actions cited by Gaul collectively and drawing
all inferences in her favor, the Court finds that sufficient evidence
exists to establish a genuine issue of adverse employment action.
Third Circuit cases focus primarily on timing and evidence of ongoing
antagonism in finding the requisite causal link for a retaliation claim.
See Abramson v. William Patterson College of New Jersey,
250 F.3d 265, 288 (3d Cir. 2001); Hartman, 2003 WL 22358548, at
*10. Unless the temporal proximity is "unusually suggestive," timing
alone is insufficient to establish the necessary connection. See Farrell v. Planters Lifesavers
Co., 206 F.3d 271, 280 (3d Cir. 2000). In such instances, timing
plus any circumstantial evidence, including a "pattern of antagonism"
following the protected conduct, that supports the inference can be used
to substantiate a causal connection. See id. at 280-81. While
the timing aspects in Gaul's case is not "unusually suggestive," Gaul
need only show at this stage that there exists a genuine issue of
material fact. Drawing all inferences in her favor, the Court finds that
the allegations here are sufficient to establish a causal connection.
Zep has proffered legitimate non-discriminatory reasons only for its
actions after Gaul returned to Zep as a sales representative. In
particular, Zep states that (1) the sales goals were established in light
of Gaul's previous experiences at Zep; (2) Aimis had e-mailed Gaul asking
if she needed help; and (3) Aimis and Powers decided not to give any
business to Gaul until her performance as a sales representative had
improved. Zep has failed to articulate any legitimate reasons for the
remaining adverse employment actions described above.
Even assuming that Zep has fully met its burden, Gaul has met her
rebuttal burden of proving by a preponderance of evdience that "the
legitimate reasons offered by the defendant were . . . a pretext for
[retaliation]." Burdine, 450 U.S. at 253, 254 n.7. As long as
plaintiff produces sufficient evidence of pretext, she need not produce additional evidence of retaliatory discrimination
beyond her prima facie case to proceed to trial. See Sempier,
45 F.3d at 731. Factors such as the defendant's credibility, the timing
of an employee's dismissal and the employer's treatment of the employee
can raise an inference of pretext which would render summary judgment for
the employer inappropriate. See Josey v. Hollingsworth
Corp., 966 F.2d 632, 638-39 (3d Cir. 1993); Hartman, 2003
WL 22358548, at *11. Here, Gaul points out that while Zep argues she was
not given business leads because of her performance, the business was
then given to new sales representatives. Gaul also notes that, beyond the
e-mails Aimis sent her, Aimis had never met with her to discuss her sales
responsibilities nor responded to any of her e-mails asking for help. In
sum, Gaul has raised sufficient issues of material fact that could lead a
reasonable factfinder to conclude that she was subjected to retaliatory
actions. Accordingly Zep's summary judgment motion as to Gaul's Title VII
retaliation claim is denied.
V. COUNT II: EQUAL PAY ACT
The fundamental purpose of the Equal Pay Act ("EPA"),
29 U.S.C. § 206 et seq., is to remedy disparities in pay arising from
traditional concepts of gender. See Corning Blass Works v.
Brennan, 417 U.S. 188, 195 (1974). Under the EPA, an employer is
proscribed from discriminating, on the basis of gender, by paying lower
wages to employees of one gender than those paid to employees of the other gender who are performing equal work on jobs that
require equal skill and responsibility. See
29 U.S.C. § 206(d)(1).*fn4 Courts "look beyond the job title to determine
whether the jobs are substantially equal." Ryan v. General Mach.
Prods., 277 F. Supp.2d 585, 597 (E.D. Pa. 2003) (quoting
Brobst v. Columbus Servs. Int'l, 761 F.2d 148, 151 (3d Cir.
Claims based upon the EPA follow a two-step burden-shifting paradigm.
See Stanziale v. Jargowsky, 200 F.3d 101, 107 (3d Cir. 2000).
First, the plaintiff must establish a prima facie case by demonstrating
that employees of the opposite sex were paid differently for performing
"equal work," which is work of substantially equal skill, effort and
responsibility, under similar working conditions. Id. at 107.
The plaintiff need only establish that she was paid differentially
because of her gender with respect to a single male employee.
See Ryan, 277 F. Supp.2d at 596. If the plaintiff
meets her initial burden, the burden of persuasion then shifts to the
employer to demonstrate the applicability of one of four affirmative
defenses available under the EPA: (1) a bona fide seniority system; (2) a merit system; (3) a system which
measures earnings by quantity of quality of production; or (4) a
differential based on any factor other than sex. See Stanziale,
200 F.3d at 107 n.6; 29 U.S.C. § 206(d)(1). Because the employer
bears the burden of proof at trial, in order to prevail at the summary
judgment stage, the employer must prove at least one affirmative defense
"so clearly that no rational jury could find to the contrary." Ryan,
277 F. Supp.2d at 596 (quoting EEOC v. Delaware Dep't of Health and
Soc. Servs., 865 F.2d 1409, 1414 (3d Cir. 1989)). Not only must the
employer submit evidence from which a reasonable factfinder could
conclude that the employer's proffered reasons could explain the wage
disparity, but the employer must produce sufficient evidence from which a
reasonable factfinder could conclude that the proffered reasons actually
motivated the wage disparity. See Stanziale, 200 F.3d at 108-9.
Here, Gaul's EPA claims are based on the earnings of a male BSM in
Zep's New Jersey branch, John Richter, over a period of years. Gaul was
promoted to the BSM position six months after Richter became BSM of the
New Jersey branch. The parties do not dispute that both Richter and Gaul
performed substantially similar work as BSMs. For FY 1999 through FY
2001, the record indicates that Gaul's base salary was consistently lower
than Richter's. Gaul has thus satisfied her prima facie burden by showing
that she was paid less than an employee of the opposite sex for substantially similar work. Because Zep has not addressed any of
the four affirmative defenses in response to Gaul's EPA claim, summary
judgment is denied as to this count.
VI. COUNT IV: BREACH OF CONTRACT
Under Pennsylvania law, to make out a cause of action for breach of
contract, the plaintiff must plead and prove (1) the existence of a
contract, including its essential terms; (2) a breach of the duty
imposed by the contract; and (3) damages resulting from the breach.
See Halstead v. Motorcycle Safety Found. Inc., 71 F. Supp.2d 455,
458 (E.D. Pa. 1999); Corestates Bank v. Cutillo,
723 A.2d 1053, 1058 (Pa. Super. 1999). The Court must determine, as a matter
of law, whether the relevant contract terms are ambiguous. See 12th
St. Gym v. Gen. Star. Indem. Co., 93 F.3d 1158, 1165 (3d Cir.
1996). If the contract is unambiguous, then it is for the Court to
decide whether the contract was breached. See St. Paul Fire &
Marine Ins. Co. v. Lewis, 935 F.2d 1428, 1431 (3d Cir. 1991);
Mellon Bank, N.A. v. Aetna Bus. Credit, 619 F.2d 1001, 1011
n.10 (3d Cir. 1980); Engers v. Perini Corp., No. 92-1982, 1993
WL 235911, at *3 (E.D. Pa. June 28, 1993).
In Count IV Gaul asserts that Zep failed to comply with the 1998 BSM
Employment Agreement, entitling her to three months of severance payment
in the event that she was terminated. Zep argues that Gaul cannot make
out an actionable breach of contract claim because she has no damages and
therefore cannot satisfy the third element of her claim. When Gaul was demoted in August 2001, Zep
initially took the position that she was not entitled to severance
payments because she was not terminated from employment with Zep.
However, Zep subsequently revised its position and paid Gaul her full BSM
base salary for the three-month period from September to November 2001.
Even assuming that Zep did breach the 1998 BSM Agreement, it is
undisputed that Gaul has now been paid the three month severance to which
she claims she is entitled. Gaul has not put forth any further evidence
of her damages, beyond conclusory statements that she was harmed by Zep's
treatment of her during the three month period following her demotion.
Accordingly, summary judgment is entered in favor of Defendants as to
For the reasons stated, Defendant Zep's motion for summary judgment is
granted as to Count IV and denied as to Counts I, II, and III.
Additionally, Defendant National Service Industries, Inc. is dismissed as
a party to this action.
An appropriate Order follows.
AND NOW, this ____ day of May, 2004, upon consideration of Defendant
Acuity Specialty Products Group, Inc. d/b/a Zep Manufacturing Company's
Motion for Summary Judgment (Docket No. 40), Plaintiff Karen Lee Gaul's
response thereto (Docket No. 51), and for the reasons set forth in the
accompanying Memorandum, IT IS HEREBY ORDERED that Defendant's Motion is
GRANTED IN PART and DENIED IN PART as follows:
(1) Defendant's Motion for Summary Judgment is GRANTED as to Count IV;
(2) Defendant's Motion for Summary Judgment is DENIED as to
Counts I, II, and III.
IT IS FURTHER ORDERED that all claims against Defendant National
Service Industries, Inc., are dismissed.