Lori Freeman v. Dal-Tile Corporation

Filing

AMENDING ORDER/OPINION filed [999348640] amending and superseding Published Authored Opinion [999345687-2] dated 4/29/2014. Originating case number: 5:10-cv-00522-BR Copies to all parties.. [13-1481]

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Filed:

May 1, 2014

UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 13-1481
(5:10-cv-00522-BR)

LORI FREEMAN,
Plaintiff – Appellant,
v.
DAL-TILE
CORPORATION,
d/b/a
Dal-Tile
Distribution,
Incorporated, d/b/a Dal-Tile Services, Incorporated,
Defendant – Appellee,
and
VOSTONE INCORPORATED; TIMOTHY KOESTER,
Defendants.

O R D E R

The Court amends its opinion filed April 29, 2014, as
follows:
On page 18, second paragraph, line 3 -- “Freeman used
racial slang” is corrected to read “Koester used racial slang.”

For the Court – By Direction

/s/ Patricia S. Connor
Clerk

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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 13-1481

LORI FREEMAN,
Plaintiff – Appellant,
v.
DAL-TILE
CORPORATION,
d/b/a
Dal-Tile
Distribution,
Incorporated, d/b/a Dal-Tile Services, Incorporated,
Defendant – Appellee,
and
VOSTONE INCORPORATED; TIMOTHY KOESTER,
Defendants.

Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh.
W. Earl Britt, Senior
District Judge. (5:10-cv-00522-BR)

Argued:

January 29, 2014

Decided:

April 29, 2014

Before TRAXLER, Chief Judge, and NIEMEYER and SHEDD, Circuit
Judges.

Reversed in part, affirmed in part, and remanded by published
opinion. Judge Shedd wrote the majority opinion, in which Chief
Judge Traxler joined.
Judge Niemeyer wrote an opinion
concurring in part and dissenting in part.

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ARGUED: Anne Warren King, GEORGETOWN UNIVERSITY LAW CENTER,
Washington,
D.C.,
for
Appellant.
Kristine
Marie
Sims,
CONSTANGY, BROOKS & SMITH, LLP, Winston-Salem, North Carolina,
for Appellee.
ON BRIEF: Brian Wolfman, Institute for Public
Representation, GEORGETOWN UNIVERSITY LAW CENTER, Washington,
D.C., for Appellant. William J. McMahon, IV, CONSTANGY, BROOKS
& SMITH, LLP, Winston-Salem, North Carolina, for Appellee.

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SHEDD, Circuit Judge:
Lori Freeman appeals a grant of summary judgment in favor
of her former employer, Dal-Tile Corporation, on her claims of
racial

and

discharge,

sexual
and

hostile

common

reasons

discussed

summary

judgment

more
on

law

work

obstruction

fully

the

environment,

below,

hostile

of

we

work

constructive

justice.

reverse

the

environment

For

the

grant

claims

of
and

remand them for further consideration. We affirm the grant of
summary judgment on the claims of constructive discharge and
common law obstruction of justice.
I.
Dal–Tile Corporation manufactures, distributes, and markets
ceramic

tile

and

manufacturing

natural

facilities,

stone
five

products. 1
regional

It

operates

distribution

eight

centers,

and over 250 sales service centers, including both stone yards
and tile showrooms.
In June 2008, Dal–Tile acquired the assets of Marble Point,
Inc., a
owner

stone

Marco

yard

Izzi.

located
Dal–Tile

in

Raleigh,

incorporated

1

North
this

Carolina,

from

newly-acquired

All facts discussed in this opinion are presented in the
light most favorable to Freeman, the non-moving party. See
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986)(“The
evidence of the non-movant is to be believed, and all
justifiable inferences are to be drawn in his favor.”); Evans v.
Techs. Applications & Serv. Co., 80 F.3d 954, 958 (4th Cir.
1996).

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operation

into

“Stoneyard”).
interest

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in

remodeling

a

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sale-service

After

this

VoStone,
center.

sale,

Inc.,
A

a

center
Izzi

organization

purchased

Raleigh-based

significant

an

kitchen

percentage

of

(the

ownership
and

bath

VoStone's

business involved working with Dal–Tile.
In August 2006, Freeman began working as a receptionist for
Dal–Tile’s

predecessor,

Marble

Point.

She

was

hired

on

a

temporary basis through a staffing agency, but after six months,
she joined Marble Point as a permanent employee. Throughout her
tenure

at

Marble

Point,

Freeman

reported

to

Izzi

and

to

assistant manager Sara Wrenn. Following Dal–Tile's acquisition
of Marble Point, Freeman became a Dal–Tile employee, 2 and Wrenn
continued to be her supervisor. Freeman’s first position with
Dal–Tile

was

General

Office

Clerk.

Over

time,

Freeman

began

interacting more frequently with Dal–Tile's customers, and she
effectively functioned as a Customer Service Representative. In

2

In June 2008, Dal–Tile's Regional Human Resources Manager
visited the Stoneyard and held a group meeting with the
employees to review Dal–Tile's policies and employee benefits
programs. At that time, Freeman received Dal–Tile's employee
handbook, including its policy prohibiting harassment and
discrimination. Dal–Tile's policy against harassment, which was
in place throughout Freeman’s tenure, states that Dal–Tile will
not tolerate harassment based on an individual's sex, race, or
other protected characteristics. It also defines the sort of
conduct prohibited, provides avenues for employees to report
harassment to the company, and prohibits retaliation against
individuals who raise complaints under the policy.

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May 2009, she was promoted to the role of Sales Consultant. In
November 2009, Freeman’s position was reclassified to Customer
Service Representative.
The harassment claims at issue are based on the behavior of
Timothy

Koester,

an

independent

sales

representative

for

VoStone. Freeman usually interacted with Koester more than once
a day while he was conducting business with Dal–Tile on behalf
of VoStone.
About two weeks after Freeman became a temporary employee
with Marble Point in August 2006, she overheard Koester as he
walked into Wrenn's office and, referencing a photograph of two
former employees, asked Wrenn and another employee: “[H]ey, who
are these two black b****es[?]” J.A. 76. After the incident,
Freeman asked Wrenn about Koester, inquiring: “[W]ho was he and
what

was

his

deal[?]”

J.A.

77.

Wrenn

replied:

“[H]e's

an

asshole, but I don't think he'll do it again.” Id. The next day,
Freeman told Koester “how uncomfortable and demeaning that made
[her] feel,” and she asked him not to use that sort of language
anymore. J.A. 75.
Freeman also recalled Koester making comments about women
he had been with the night before. On one occasion, Koester
showed her a photograph of a naked woman on his cell phone and
remarked: “[T]his is what I left in my bed to come here today.”
J.A.

80.

On

a

different

occasion,
5

Freeman

overheard

Koester

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talking

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with

one

of

her

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co-workers,

Jodi

Scott,

about

photographs of Scott's daughters that were displayed in Scott's
office. According to Freeman, Koester told Scott: “I'm going to
hook up with one your daughters,” or “I'm going to turn one of
your daughters out.” J.A. 136. Scott replied: “[Y]ou better stay
away from my kids,” or “[D]on't talk to me about my kids.” Id.
In a different instance, Koester passed gas on Freeman’s
phone. Koester was using Freeman’s office phone, and she was
standing

there

waiting

for

him

to

finish

his

conversation.

Before Koester hung up the phone, he held it to his buttocks and
passed gas on it. J.A. 81. Wrenn was present for this incident.
Freeman immediately began crying and had to leave the room to
calm down. J.A. 82.
In

June

2009,

Koester

called

Freeman

about

covering

a

customer appointment for him because he had been partying the
night before. Koester indicated that he could not come into the
office, saying: “I'm just too f***ed up, don't take offense, but
I'm as f***ed up as a n****r's checkbook.” J.A. 99. Freeman told
Wrenn

about

Koester's

comment

that

same

day,

but

Wrenn

just

“scoffed and shook her head and put her head back down and
continued on with trying to pick the nail polish off of her
nails . . . .” J.A. 102. Freeman also reported Koester's remark
to James Vose, one of the co-owners of VoStone. Vose laughed and

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said: “[Y]ou got to admit that's kind of funny, just do what I
do and hit him because he's an asshole.” J.A. 107.
Subsequently, on July 29, 2009, Koester called Dal–Tile's
general office line, and Freeman answered the phone. Koester had
his

six-year-old

daughter,

Angelina,

with

him

at

the

time.

Freeman, who knew Angelina, asked Koester to tell Angelina that
she said “hi.” Instead, Koester put Freeman on speaker phone so
that she and Angelina could talk with one another. Freeman then
heard Angelina ask: “Daddy, who's that[?]” J.A. 111. Koester
replied: “[T]hat's the black b**** over at Marble Point.” Id.
Freeman “immediately became very irate.” Id. She told Koester:
“[D]on't you ever call me a black b**** as long as you live.”
Id. Koester responded: “[O]h, word.” Id. Freeman promptly told
Wrenn about Koester's comment, but Wrenn appeared disinterested
and continued a conversation that she had been having with some
other co-workers.
In addition to these specific incidents, Freeman and other
co-workers testified more generally that Koester frequently made
inappropriate

sexual

comments.

Freeman

testified

that

Koester

“was always coming in making some sort of lewd comments.” J.A.
78. She also stated that “maybe two or three times a week” she
would have to correct Koester and tell him not to say something
inappropriate.

J.A.

79.

Freeman

explained

that

Koester

would

“come in to discuss what he did the night before with whatever
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woman he was with and [Freeman] would tell him [she didn’t] want
to hear it.” J.A. 80. Wrenn confirmed this, stating that “he
liked to brag about his, you know, evening excursions, or his
weekend excursions. . . . [T]here were times where he would say
something about what he did the night before that had sexual
content to it.” J.A. 269. According to Wrenn, “[h]e always made
comments

about

women.”

J.A.

274.

Wrenn

also

testified

that

Koester used the word “b****” in the office, such as “You should
have seen these hot b****es I met last night.” J.A. 268. Jodi
Scott testified that Koester used the word “b****” “[u]sually
about

every

time

that

he

came

in.”

J.A.

381–82.

Wrenn

even

referred to Koester as a “pig.” J.A. 253. Koester himself also
admitted he made sexual comments in the office. J.A. 325.
Freeman and other co-workers also testified generally about
Koester’s

inappropriate

racial

remarks.

For

instance,

Koester

used racial “slang” such as “Yo, b****” and “How’s my b****es?”
when talking to the female employees. J.A. 384–85. Jodi Scott
testified that Koester used racial language every day that he
came

into

the

office.

J.A.

386.

using

African-American

type

slang.

human

resource

manager,

explained

Koester
J.A.
that

himself
325.

admitted

Cathy

according

Diksa,

to

to
a

manager

Wrenn, Koester used racial language in the office. J.A. 217. For
instance,

following

the

election

of

Barack

Obama

in

2008,

Koester said to Freeman, “[Y]ou guys won.” J.A. 355. Koester
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himself testified that he probably made comments about taking
“beautiful
admitted

black

that

girls”

he

home

with

made

comments

him.

that

J.A.

were

343.

He

“[m]aybe

also

racially

inappropriate.” J.A. 344.
Following the most recent “black b****” incident in July
2009, Freeman reported Koester’s remarks to Cathy Diksa in human
resources

after

Wrenn

ignored

her

complaint.

Diksa

initially

promised Koester would be permanently banned from the facility.
However,

the

company

lifted

the

ban

and

instead

prohibited

Koester from communicating with Freeman. He was allowed on the
premises

but

had

to

coordinate

all

on-site

meetings

through

Wrenn.
Freeman was so upset about the prospect of being forced to
interact with Koester that she took a medical leave of absence
beginning

September

2,

2009.

During

this

time

she

received

treatment for depression and anxiety. Freeman returned to work
around November 19, 2009. Wrenn informed Freeman that Koester no
longer

worked

for

VoStone

but

for

another

kitchen

and

bath

fabricator. Wrenn told Freeman that Koester would continue to
call Wrenn’s cell phone and not the general office line if he
needed to conduct business with Dal-Tile.
On December 7, 2009, Freeman notified Dal–Tile that she was
resigning from her position effective December 11, 2009. Freeman
testified that she resigned because the depression and anxiety
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became too much for her; she was constantly worried she would
encounter Koester at work. J.A. 179–80.
In October 2009, while on medical leave, Freeman filed a
charge

with

(“EEOC”),

the

Equal

asserting

Employment

that

Dal–Tile

Opportunity
had

Commission

subjected

her

to

discrimination based on her sex and race.
After receiving a right to sue letter, Freeman brought this
action

in

the

Eastern

District

of

North

Carolina,

asserting

claims for racial hostile work environment under 42 U.S.C. §
1981; racial and sexual hostile work environment under Title VII
of the Civil Rights Act of 1964; discriminatory discharge under
42

U.S.C.

§

1981;

and

obstruction

of

justice

under

North

Carolina common law. 3 The obstruction of justice claim is based
on the allegation that Dal-Tile failed to issue a litigation
hold on e-mails after it received her October 28, 2009 EEOC
charge

and

thus

destroyed

a

significant

number

of

e-mails

pursuant to its email retention policy.
Following discovery, in May 2012, Dal-Tile filed

a motion

for summary judgment. The district court granted this motion.
Freeman v. Dal-Tile Corp., 930 F. Supp. 2d 611 (E.D.N.C. 2013).

3

She also asserted retaliatory demotion and discharge
claims under 42 U.S.C. § 1981, but she does not appeal the
dismissal of those claims.

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First, the district court held that in regard to the racial
and

sexual

present

hostile

work

sufficient

material

fact

objectively

on

evidence
the

severe

environment
to

issue

or

claims,

create

of

a

whether

pervasive.

Freeman

genuine
the

However,

did

dispute

harassment

the

district

not
of
was

court

noted “that plaintiff subjectively perceived the alleged racial
and sexual harassment to be abusive.” Id. at 628.
Second,
harassment

the

was

district

found

to

court

be

ruled

objectively

that

even

severe

or

if

the

pervasive

enough to alter Freeman’s work conditions, Dal-Tile would still
be

entitled

to

establish

that

district

court

unpublished

summary

judgment

liability
used

opinion

a
of

should

because
be

negligence
this

Court,

Freeman

imputed
standard,
in

to

could

not

Dal-Tile.

The

adopted

which

“an

from

an

employer

is

liable [for the actions of a third party] ‘if it knew or should
have

known

of

the

harassment

and

failed

to

take

appropriate

actions to halt it.’” Id. at 638 (quoting EEOC v. Cromer Food
Servs., Inc., 414 F. App’x 602, 606 (4th Cir. 2011)).
Applying this standard, the district court held that DalTile

did

harassment

not

have

because

actual
“no

or

constructive

reasonable

knowledge

fact-finder

could

of

the

conclude

that plaintiff’s statement[s] to Wrenn constituted a complaint,
either formal or informal.” Id. at 639. Further, the district
court noted that “even if [it] were to assume arguendo that the
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. . . remarks that plaintiff made to Wrenn could somehow be
construed as complaints, it is undisputed that plaintiff knew
there were additional avenues that she could have pursued if she
was

unsatisfied

second

with

inquiry

of

Wrenn’s
the

response.”

negligence

Id.

at

analysis,

640.

In

whether

the
the

employer’s response was appropriate, the district court ruled
that Dal-Tile’s response to Koester’s behavior was adequate as a
matter of law.
Third,

the

district

court

held

that

Freeman

was

not

constructively discharged but, rather, voluntarily resigned. The
district
anyone

court
at

noted

Dal-Tile

that
acted

Freeman

was

“unable

deliberately

with

to

show

an

that

unlawful

discriminatory intent in order to force her to resign either
before or after she returned from medical leave.” Id. at 647.
Lastly,

the

district

court

ruled

that

Freeman’s

North

Carolina obstruction of justice claim failed as a matter of law.
The district court stated that “the evidence does not support a
finding that anyone at Dal-Tile intentionally destroyed emails
in order to keep plaintiff from proceeding with a legal claim.”
Id. at 648.
II.
This Court “review[s] the district court’s grant of summary
judgment

de

novo,

applying

the

same

legal

standards

as

the

district court and viewing the facts and inferences drawn from
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the facts in the light most favorable to . . . the nonmoving
party.” Evans v. Techs. Applications & Serv. Co., 80 F.3d 954,
958 (4th Cir. 1996).
On
conclude

appeal,
that

Freeman

she

was

argues

1)

subjected

a

to

reasonable

a

racially

jury
and

could

sexually

hostile work environment; 2) a reasonable jury could find that
liability for Koester’s harassment is imputable to Dal-Tile; 3)
a

reasonable

discharged;

jury

and

could

4)

find

that

North

Carolina

she

was
law

common

constructively
requires

only

general intent not specific intent for obstruction of justice
claims, and the destruction of emails here meets this standard.
We address each in turn.
III.
Freeman first argues the district court erred in granting
summary judgment on her hostile work environment claims. Under
Title VII, “[i]t shall be an unlawful employment practice for an
employer

.

.

.

to

discriminate

against

any

individual

with

respect to his compensation, terms, conditions, or privileges of
employment, because of such individual's race, color, religion,
sex, or national origin . . . .” 42 U.S.C. § 2000e-2. “Since an
employee's

work

employment,

Title

environment
VII

is

creates

a

a

term

hostile

or

condition

working

of

environment

cause of action.” EEOC v. R & R Ventures, 244 F.3d 334, 338 (4th

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Cir. 2001) (citing Meritor Sav. Bank, FSB v. Vinson, 477 U.S.
57, 73 (1986)).
For this Court to reverse the district court’s grant of
summary judgment to Dal-Tile on her hostile work environment
claims, Freeman must establish that the evidence, viewed in her
favor,
would allow a reasonable jury to conclude that the
harassment was (1) unwelcome, (2) based on [Freeman’s]
gender or race, (3) sufficiently severe or pervasive
to alter the conditions of her employment and create
an abusive atmosphere, and (4) imputable to [DalTile].
EEOC v. Cent. Wholesalers, Inc., 573 F.3d 167, 175 (4th Cir.
2009) (citing EEOC v. Sunbelt Rentals, Inc., 521 F.3d 306, 313–
14 (4th Cir. 2008)).
First, Freeman must establish that a reasonable jury could
conclude that the sex- or race-based harassment was unwelcome.
As

discussed

above,

Freeman

complained

of

her

harassment

to

Wrenn, human resources, and Koester himself. She told Koester
repeatedly to stop making such crude and demeaning comments. She
cried in both Wrenn and Koester’s presence over the harassment.
She eventually was treated for depression and anxiety because of
it. Based on this evidence, we believe that a reasonable jury
could find that both the sex- and race-based harassment were
unwelcome.

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Second, Freeman must show that a reasonable jury could find
that the harassment was based on her sex or race. The evidence
shows that Koester used the word b**** in the office almost
every time he came in, often discussed his sexual encounters
with

women,

showed

naked

pictures

of

women

to

Freeman

and

others, frequently made “lewd” comments, discussed having sex
with

a

co-worker’s

daughters,

and

called

Freeman

a

“black

b****,” among other things. Based on this evidence, a reasonable
jury could find that the harassment was based on Freeman’s sex.
See, e.g., Forrest v. Brinker Intern. Payroll Co., 511 F.3d 225,
229

(1st

Cir.

2007)

(stating

that

a

“raft

of

case

law”

“establishes that the use of sexually degrading, gender-specific
epithets, such as . . . ‘b****,’ . . . has been consistently
held to constitute harassment based upon sex”).
Regarding

race,

Koester

discussed

bringing

“black

girls”

home with him, used racial slang in the office on a daily basis,
said “black b****” at least twice (once directed at Freeman),
told Freeman he was “as f***ed up as a n****r’s checkbook,” and
admitted to maybe using “racially inappropriate” language in the
office. In light of this evidence, a reasonable jury could find
that Koester’s harassment was also based on Freeman’s race. See
Spriggs v. Diamond Auto Glass, 242 F.3d 179, 185 (4th Cir. 2001)
(describing the use of the word “n****r” as an “unambiguously

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racial epithet” (quoting Rodgers v. Western–Southern Life Ins.
Co., 12 F.3d 668, 675 (7th Cir. 1993))).
Third, Freeman must show that a reasonable jury could find
that

the

pervasive
create

an

sexas

or

to

race-based

alter

abusive

or

the

harassment

conditions

hostile

of

atmosphere.

was
her

so

severe

employment

“This

element

or
and

of

a

hostile work environment claim has both subjective and objective
parts.” Cent. Wholesalers, Inc., 573 F.3d at 175 (citing Harris
v. Forklift Systems, Inc., 510 U.S. 17, 21–23 (1993)). Freeman
thus “must show that [she] did perceive, and a reasonable person
would perceive, the environment to be abusive or hostile.” Id.
Regarding

the

subjective

component,

the

district

court

stated, and we agree, that the evidence supports a finding that
Freeman subjectively perceived both types of harassment to be
abusive or hostile. As discussed above, Freeman complained about
the harassment to her supervisor, human resources, and Koester
himself. She cried at work in front of co-workers because of the
harassment. The evidence also shows the harassment interfered
with

her

ability

to

work,

as

she

was

often

distracted

by

Koester’s inappropriate behavior and the stress that she felt
from having to interact with him. Freeman ultimately had to take
medical

leave

and

seek

treatment

for

depression

and

anxiety

because of Koester’s harassment. In light of this evidence, we
conclude that a reasonable jury could find that Freeman found
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harassment

subjectively

Pg: 18 of 32

hostile

or

abusive.

See

Cent.

Wholesalers, Inc., 573 F.3d at 176 (finding a triable issue of
fact

on

subjective

perception

of

hostility

where

plaintiff

“complained about both types of harassment and stated that she
found such harassment objectionable” and “that the harassment
caused her emotional distress”); Harris v. Mayor & City Council
of Baltimore, 429 F. App’x 195, 202 (4th Cir. 2011) (finding a
triable
where

issue

of

plaintiff

fact

on

presented

subjective
evidence

perception
that

she

of

hostility

complained

of

harassment, suffered from a depressive disorder because of her
work experiences, and was seen crying at work by a co-worker).
Next

we

must

determine

whether

the

harassment

objectively severe or pervasive.
This objective inquiry “is not, and by its nature
cannot be, a mathematically precise test.” Harris, 510
U.S. at 22. “Rather, when determining whether the
harassing conduct was objectively severe or pervasive,
we must look at all the circumstances, including the
frequency of the discriminatory conduct; its severity;
whether it is physically threatening or humiliating,
or a mere offensive utterance; and whether it
unreasonably
interferes
with
an
employee's
work
performance.” Sunbelt, 521 F.3d at 315 (quotation
marks omitted). “[N]o single factor is” dispositive,
Harris, 510 U.S. at 23, as “[t]he real social impact
of workplace behavior often depends on a constellation
of
surrounding
circumstances,
expectations,
and
relationships which are not fully captured by a simple
recitation of the words used or the physical acts
performed,” Oncale v. Sundowner Offshore Services,
Inc., 523 U.S. 75, 82 (1998).
Cent. Wholesalers, Inc., 573 F.3d at 176.

17

was

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Here,

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the

record

is

Pg: 19 of 32

replete

with

evidence

of

frequent

abusive behavior by Koester during Freeman’s tenure with Marble
Point and Dal-Tile. Regarding the sex-based harassment, Koester
repeatedly used the word “b****” in the office, inquired about
two “black b****es” he saw in a picture, called Freeman a “black
b****,” passed gas on Freeman’s phone, and often discussed his
sexual
naked

experiences
pictures

regular
“pig.”

on

basis,
Freeman

whether

the

with
his
and

has

women,
phone.
was

certainly

sex-based

including
He

made

showing

“lewd”

described

by

established

a

harassment

was

co-workers

comments
Wrenn

triable

objectively

on
as

a
a

issue

on

severe

or

pervasive. See, e.g., Cent. Wholesalers, Inc., 573 F.3d at 176
(finding that the frequent use of the word “b****,” coupled with
both displays of scantily clad or naked women in the office and
inappropriate sexual jokes, was sufficient to create a triable
issue of fact on the issue of objective hostility).
Based on the evidence, a reasonable jury could also find
the race-based harassment was objectively severe or pervasive.
Koester used racial slang in the office on a daily basis. He
inquired

about

two

“black

b****es”

he

saw

in

a

picture.

He

called Freeman a “black b****” in the presence of his young
daughter. He discussed bringing home black women to have sex
with them. He told Freeman he was “as f***ed up as a n****r’s
checkbook.”
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To begin, “the word ‘n****r’ is pure anathema to AfricanAmericans,”
everyone.

Spriggs,

Moreover,

242
as

F.3d

we

at

have

185,

stated

as

it

should

before,

“[w]e

be

to

cannot

ignore . . . the habitual use of epithets here or view the
conduct without an eye for its cumulative effect. Our precedent
has made this point repeatedly.” Sunbelt Rentals, Inc., 521 F.3d
at 318. Therefore, when viewing the circumstances as a whole, we
find the use of the word “n****r,” coupled with the on-going
offensive racial talk, use of the term “black b****” on more
than

one

occasion

(once

directed

at

a

black

employee),

and

sexual talk regarding black women, is sufficient evidence for a
reasonable

jury

to

find

the

race-based

harassment

was

objectively severe or pervasive.
Lastly,

Freeman

must

establish

a

“basis

for

imposing

liability” on Dal-Tile for the sex- or race-based harassment.
Gilliam v. S.C. Dep't of Juvenile Justice, 474 F.3d 134, 142
(4th

Cir.

2007).

The

district

court

adopted

a

negligence

standard for analyzing an employer’s liability for third-party
harassment under Title VII. This Court has not yet adopted this
standard in a published opinion, but we do so today. 4 Similar to

4

Other circuits to address the issue have also
similar standard. See Dunn v. Washington Cnty., 429
691 (7th Cir. 2005)(“[T]he plaintiff bears the burden
that the employer knew of the problem (usually though
this requires the employee to show that a complaint
(Continued)
19

adopted a
F.3d 689,
of showing
not always
was made)

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the reasoning we set forth for employer liability for co-worker
harassment, “an employer cannot avoid Title VII liability for
[third-party] harassment by adopting a ‘see no evil, hear no
evil’ strategy.’” Ocheltree v. Scollon Prods., Inc., 335 F.3d
325, 334 (4th Cir. 2003) (en banc). Therefore, an employer is
liable under Title VII for third parties creating a hostile work
environment if the employer knew or should have known of the
harassment and failed “to take prompt remedial action reasonably
calculated to end the harassment.” Amirmokri v. Baltimore Gas &
Elec. Co., 60 F.3d 1126, 1131 (4th Cir. 1995) (quoting Katz v.
Dole, 709 F.2d 251, 256 (4th Cir. 1983)) (internal quotation
marks omitted) (applying this standard to co-worker harassment).

and that the employer did not act reasonably to equalize working
conditions once it had knowledge.”); Galdamez v. Potter, 415
F.3d 1015, 1022 (9th Cir. 2005) (“An employer may be held liable
for the actionable third-party harassment of its employees where
it ratifies or condones the conduct by failing to investigate
and remedy it after learning of it.”); Watson v. Blue Circle,
Inc., 324 F.3d 1252, 1259 (11th Cir. 2003) (“When, as in this
case, the alleged harassment is committed by co-workers or
customers, a Title VII plaintiff must show that the employer
either knew (actual notice) or should have known (constructive
notice) of the harassment and failed to take immediate and
appropriate corrective action.”); Turnbull v. Topeka State
Hosp., 255 F.3d 1238, 1244 (10th Cir. 2001) (holding that “an
employer may be responsible for sexual harassment based upon the
acts of nonemployees” under a “negligence analysis”).
This Court has also adopted this negligence standard in a
prior unpublished opinion. See EEOC v. Cromer Food Servs., Inc.,
414 F. App’x 602, 606–07 (4th Cir. 2011), and both parties agree
that a negligence analysis is appropriate.

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Applying this standard here, we conclude that a reasonable
jury could find that Dal-Tile knew or should have known of the
harassment.

Here,

Freeman

presented

evidence

that

Wrenn,

her

supervisor, knew of all three of the most major incidents: the
two “black b****” comments, and the “f***ed up as a n****r’s
checkbook”
b****”

comment.

comment,

Wrenn

which

afterward. Freeman also

was

present

Freeman

for

complained

the

first

about

to

“black
Wrenn

complained to Wrenn specifically about

the other two comments from Koester almost immediately after
occurred. 5

they

When

Freeman

complained

to

Wrenn

about

the

“f***ed up as a n****r’s checkbook” comment, Wrenn “scoffed and
shook her head and put her head back down and continued on with
trying to pick the nail polish off of her nails.” J.A. 102. When
Freeman complained about the second “black b****” comment, Wrenn
simply rolled her eyes and went on talking to a co-worker. J.A.
112. In addition to these most severe incidents, Wrenn was also
present

the

time

Koester

passed

gas

on

Freeman’s

phone

and

Freeman began crying and had to leave the room.
Not only did Wrenn know of these specific and more severe
incidents,

but

she

also

knew

the

harassment

was

an

on-going

situation. As discussed above, Wrenn herself testified that she
5

Per the company’s harassment policy, Freeman did exactly
what she was supposed to by telling Wrenn, her supervisor, of
the harassment. J.A. 199.

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knew Koester used the word “b****” in the office frequently,
that

he

made

sexual

comments

in

the

office,

that

he

showed

pictures of naked women on his phone in the office, and that he
“always made comments about women.” J.A. 268–74. Wrenn herself
referred to him as a “pig.” J.A. 253. Cathy Diksa also testified
that Wrenn knew Koester used “racial language” in the office.
J.A. 217.
This evidence, if proven true, shows that Dal-Tile, through
its agent Wrenn, had actual knowledge of the harassment and that
Freeman

found

it

offensive,

as

shown

by

Freeman’s

frequent

complaints and her negative reaction to his behavior. However,
even if Wrenn did not have actual knowledge that Freeman was
offended by Koester’s behavior, at the very least, she should
have

known

it:

inappropriate

Wrenn

behavior

complaints

about

witnessed

Freeman

the

was
and

aware
comments,

harassing

crying

of
had

incidents

from

the

Koester’s

on-going

received
from

several

Freeman,

harassment,

and

had
knew

incendiary terms like “n****r” and “black b****” had been used
in the presence of a black, female employee. As stated above,
“[a]n employer cannot avoid Title VII liability for coworker
harassment by adopting a ‘see no evil, hear no evil’ strategy.”
Ocheltree, 335 F.3d at 334. Therefore, we conclude a reasonable
jury could find that Dal-Tile knew, or at the very least, should
have known, of Koester’s harassment.
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In addition, Freeman has at least created a triable issue
of fact as to whether Dal-Tile’s response to halt the harassment
was

adequate.

Despite

Wrenn’s

notice

of

Koester’s

on-going

behavior, Dal-Tile did not take any effective action to halt the
harassment until Freeman reported up the chain to Cathy Diksa in
human resources after the final “black b****” comment. 6 At that
point, the harassment had been ongoing for three years. Diksa
originally told Freeman that Koester would be permanently banned
from Dal-Tile. J.A. 121–22. However, the company lifted the ban
and instead simply prohibited Koester from communicating with
Freeman

while

still

allowing

him

on

the

premises

if

he

coordinated his meetings through Wrenn.
As stated above, once an employer has notice of harassment,
it must “take prompt remedial action reasonably calculated to
end the harassment.” Amirmokri, 60 F.3d at 1131 (quoting Katz,
709 F.2d at 256) (internal quotation marks omitted). Not only
did Dal-Tile fail to take any serious action for three years in
spite of the long list of ongoing harassment by Koester, but
particularly shocking to us is the fact Dal-Tile took absolutely
no action when Koester passed gas on Freeman’s phone and made
Freeman

cry

in

Wrenn’s

presence,

6

nor

when

Freeman

promptly

Wrenn did tell Koester not to use inappropriate language
after the first “black b****” comment, but that proved
ineffective as the harassment continued for three more years.

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complained to Wrenn that Koester had used the word “n****r” on
the phone with her. Although the harassment eventually stopped
after the communication ban was put into place, the harassment
had continued unabated for three years prior to that. While a
communication ban may have been an adequate response had it been
put into place sooner, Dal-Tile’s failure was in not responding
promptly to the harassment. Based on this evidence, we believe a
reasonable
“prompt

jury

could

remedial

conclude

action

that

Dal-Tile

reasonably

failed

calculated

to

take

end

the

could

find

to

harassment.”
In

sum,

we

believe

a

reasonable

fact-finder

there was an objectively hostile work environment based on both
race and sex and that Dal-Tile knew or should have known of the
harassment

and

failed

to

adequately

respond.

We,

therefore,

reverse the district court’s grant of summary judgment in favor
of

Dal-Tile

environment

on

Freeman’s

claims

under

racial

Title

and

VII,

as

sexual
well

hostile
as

her

work
racial

hostile work environment claim under 42 U.S.C. § 1981, and we
remand for further consideration in the district court. 7

7

The standard used to evaluate a racial hostile work
environment claim under § 1981 is the same as the standard used
under Title VII. Spriggs, 242 F. 3d at 184. Thus our analysis is
the same for both racial hostile work environment claims here.

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IV.
Freeman also appeals the district court’s ruling that she
was not constructively discharged under 42 U.S.C. § 1981. 8 An
employee is considered constructively discharged “if an employer
deliberately

makes

the

working

conditions

intolerable

in

an

effort to induce the employee to quit.” Honor v. Booz-Allen &
Hamilton, Inc., 383 F.3d 180, 186-87 (4th Cir. 2004) (quoting
Martin v. Cavalier Hotel Corp., 48 F.3d 1343, 1353-54 (4th Cir.
1995)) (internal quotation marks and citations omitted). Freeman
must prove two elements to demonstrate constructive discharge:
“(1) the deliberateness of [Dal-Tile’s] actions, motivated by
racial bias, and (2) the objective intolerability of the working
conditions.” Id. at 186-87.
Here, Freeman did not present sufficient evidence to create
a question of fact as to whether Dal-Tile deliberately attempted
to induce her to quit, nor that her working conditions at the
time

she

resigned

were

objectively

intolerable.

Rather,

the

evidence shows that within weeks from returning from a two month
medical leave, Freeman voluntarily resigned from her position.
She had had no contact with Koester for months, nor had he even
been in the building at the same time as her since she had
8

Freeman brought her constructive discharge claim solely
under 42 U.S.C. § 1981, and thus it is only based on racial
discrimination.

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returned

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from

leave.

Pg: 27 of 32

Freeman

presented

no

evidence

that

Koester’s harassment was still creating an objectively hostile
work environment at the time she resigned, nor that Dal-Tile was
allowing him to harass her in a deliberate attempt to force her
to

quit.

summary

Therefore,
judgment

to

we

affirm

Dal-Tile

the
on

district
the

court’s

constructive

grant

of

discharge

claim.
V.
Finally, Freeman contends that the district court erred in
awarding Dal-Tile summary judgment on the North Carolina common
law obstruction of justice claim. Freeman argues that Dal-Tile
should

have

put

a

litigation

hold

on

all

relevant

emails

beginning no later than when it received Freeman’s complaint in
November 2009, and maybe even as early as when she contacted
human resources about the situation in August 2009.
In North Carolina, “acts which obstruct, impede or hinder
public or legal justice . . . amount to the common law offense
of obstructing justice.” Blackburn v. Carbone, 703 S.E.2d 788,
794 (N.C. Ct. App. 2010) (quoting Henry v. Deen, 310 S.E.2d 326,
334 (N.C. 1984)). The offense requires proof that the defendant
acted

“willfully

and

with

an

intent

to

defraud.”

State

v.

Eastmen, 438 S.E.2d 460, 464 (N.C. Ct. App. 1994). In other
words, North Carolina law requires that the defendant acted with
the specific intent to obstruct justice, not just the general
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intent to do the act which resulted in the obstruction. See
Blackburn, 703 S.E.2d at 795 & n.6 (“[A]ny action intentionally
undertaken
impeding,

by
or

the

defendant

hindering

the

for

the

purpose

plaintiff’s

of

ability

obstructing,
to

seek

and

obtain a legal remedy will suffice to support a claim for common
law obstruction of justice. . . . The necessity for showing an
intentional act of misconduct by the defendant is delineated in
a number of criminal obstruction of justice cases.”).
Here, Freeman presented no evidence that Dal-Tile destroyed
emails with the intent to hinder the litigation. Rather, they
were destroyed pursuant to Dal-Tile’s email retention policy.
Therefore, we affirm the district court’s holding that there is
not a viable obstruction of justice claim under North Carolina
common law.
VI.
In conclusion, we reverse the district court’s grant of
summary judgment in favor of Dal-Tile on the sexual and racial
hostile work environment claims under Title VII, and the racial
hostile work environment claim under § 1981, and we remand these
claims

for

further

consideration

in

the

district

court.

We

affirm the district court’s grant of summary judgment in favor
of Dal-Tile on the constructive discharge claim and the North
Carolina obstruction of justice claim.
REVERSED IN PART, AFFIRMED IN PART, AND REMANDED
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NIEMEYER, Circuit Judge, concurring in part and dissenting in
part:
This case involves a workplace allegedly made hostile by
the conduct of a customer of the employer.

In recognizing that

employers can be liable in cases where the harassing conduct was
that of a third party, the majority extends the scope of Title
VII beyond what the Supreme Court has so far recognized.
grave

concerns

about

such

an

extension

when

I have

hostile

work

environment claims were themselves an extension of Title VII,
which

was

designed

to

regulate

the

employer-employee

relationship.
But

even

recognizing

that

there

are

some

adventuresome

cases concluding that an employer can be liable for its failure
to take action to protect its employees from a third party’s
harassment, see, e.g., Dunn v. Wash. Cnty. Hosp., 429 F.3d 689,
691

(7th

Cir.

2005),

I

conclude

that

the

majority’s

opinion

today goes so far that it cannot find support even in them.

An

employer in this kind of case may be liable at most for its own
negligence in allowing the conduct of its customers to turn its
workplace

into

a

hostile

work

environment

--

i.e.,

a

work

environment that, as a result of the customers’ conduct, becomes
“permeated

with

discriminatory

intimidation,

ridicule,

and

insult that is sufficiently severe or pervasive to alter the
conditions of [an employee’s] employment.”

Harris v. Forklift

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Sys., Inc., 510 U.S. 17, 21 (1993) (internal quotation marks and
citations omitted).

As a negligence case, the analysis must

focus on identifying when the employer knew or should have known
that its employee was being subjected to harassment based on the
employee’s “race, color, religion, sex, or national origin,” 42
U.S.C. § 2000e-2(a)(1), and then on evaluating the adequacy of
the employer’s response at that point.

See Burlington Indus.,

Inc. v. Ellerth, 524 U.S. 742, 759 (1998).
In this case, the majority concludes that a reasonable jury
could find Dal-Tile liable under Title VII for discriminating
against Lori Freeman, its employee, because it permitted a DalTile customer, Timothy Koester, to engage in continuous sexbased and race-based harassment of Freeman for three years.

I

believe, however, that a closer review of the record does not
support that overly generalized conclusion.
The

record

only

supports

the

inference

that

Koester’s

conduct rose to the level of actionable harassment in the summer
of 2009.

To be sure, Koester’s conduct in the office prior to

that point had been coarse, crude, and ugly.

But there is

insufficient evidence in the record to allow a reasonable jury
to conclude that, prior to the summer of 2009, his conduct had
created a hostile or abusive working environment for Freeman at
Dal-Tile.

In

August

2006

(shortly

after

Freeman

began

her

employment at Dal-Tile), Freeman did hear Koester use the phrase
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“black

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bitches”

in

Pg: 31 of 32

Dal-Tile’s

office

photograph of two former employees.
Tile

assistant

manager,

Sara

when

referring

to

But she also heard a Dal-

Wrenn,

immediately

respond

Koester, directing him “not to use that language here.”
76.

a

to
J.A.

And for nearly three years thereafter, Freeman “carried on

a working relationship with [Koester],” describing herself as
being “friendly with [him] as long as he wasn’t making . . .
lewd comments.”

J.A. 126.

When Freeman thought Koester was

behaving inappropriately, she would tell him to cut it out, just
as her coworkers did.

As Wrenn explained:

[T]he minute [Freeman] started with [Dal-Tile], she
fit right in with us.
And, you know, everybody knew
that [Koester] ran his mouth, and you know, like I
said, it was never malice, it was never malicious. He
was just crude, and everybody knew exactly how to
handle him and put him in his place, and Lori
[Freeman] fell right into that, and she had no
problems calling him out . . . .
J.A. 292.

Similarly, Freeman stated that she had a good working

relationship with all of her coworkers, describing the office as
“very close knit.”

J.A. 58.

Thus, unlike the circumstances

presented in EEOC v. Cent. Wholesalers, Inc., 573 F.3d 167, 170
(4th Cir. 2009), and Mosby-Grant v. City of Hagerstown, 630 F.3d
326, 330 (4th Cir. 2010), where the plaintiff-employees were
surrounded

by

multiple

individuals

who

regularly

referred

to

women as “bitches” and engaged in other demeaning conduct, the

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here

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is

clear

that

Pg: 32 of 32

Koester

was

the

outlier

in

an

otherwise harmonious and harassment-free office environment.
A

jury

could

find,

however,

that

the

circumstances

for

Freeman did change in the summer of 2009 when she reasonably
began to perceive Koester’s conduct as being so offensive as to
make her work environment abusive.

This is when Koester told

Freeman that he was as “fucked up as a nigger’s checkbook” and
then, several weeks later, called her a “black bitch.”
was

also

Freeman.

at

this

point

that

Dal-Tile

intervened

to

But it
protect

The day after Koester made the “black bitch” comment

to Freeman, Dal-Tile told Koester that he was suspended from the
premises.

And

while

Dal-Tile

eventually

agreed

to

conduct

business with Koester again, it was only with restrictions in
place that ensured that Freeman would not have to interact with
him.

Indeed, Koester never made another inappropriate remark in

Freeman’s presence.
This is not a case where an employer knew that its employee
was

experiencing

response.
intervene

actionable

harassment

but

did

nothing

in

Rather, the record shows that Dal-Tile did indeed
and

intervened

effectively.

I

would

accordingly

affirm the district court’s summary judgment in favor of DalTile

on

all

of

Freeman’s

claims,

environment claims.

31

including

her

hostile

work