Davis et al v. Ricketts et al
MEMORANDUM AND ORDER - IT IS ORDERED: The Defendants' Motion for Summary Judgment (Filing No. 102 ) is granted. The Plaintiffs' Motion for Partial Summary Judgment (Filing No. 105 ); the Defendants' Motions in Limine (Filing No. 141 ); the Plaintiffs' Motion in Limine to Exclude Testimony and other Evidence Regarding Matters Defendants Claimed are Protected by the Attorney-Client Privilege & Work Product Doctrine (Filing No. 148 ); the Plaintiffs' Motion in Li mine to Exclude Testimony and Other Evidence Regarding Unemployment Benefits and Moonlighting Income (Filing No. 151 ); the Plaintiffs' Motion in Limine to Exclude Evidence Regarding Bankruptcy and Criminal Charges (Filing No. 154 ); the Pl aintiffs' Motion in Limine to Exclude Irrelevant Communications Regarding Plaintiff Patricia Davis' Diary (Filing No. 157 ); and Plaintiffs' Motion in Limine to Exclude Witnesses Pursuant to F.R.E. 615 (Filing No. 159 ) all are denied as moot. All other pending motions are denied as moot. A separate Judgment will be entered. Ordered by Chief Judge Laurie Smith Camp. (TCL )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEBRASKA
PATRICIA J. DAVIS, an Individual,
JEFFREY J. GOERGEN, an Individual,
and PATRICIA A. DUNCAN, an
HUGO ENTERPRISES, LLC, f/k/a
RICKETTS ENTERPRISES, LLC, a
Nebraska Limited Liability Company,
and OPPORTUNITY EDUCATION
FOUNDATION, an Iowa Non-Profit
CASE NO. 8:11CV221
This matter is before the Court on the Motion for Summary Judgment (Filing No.
102) submitted by Defendant Opportunity Education Foundation (the “Foundation”) and
Defendant Hugo Enterprises, LLC (“Hugo Enterprises”); the Motion for Partial Summary
Judgment (Filing No. 105) submitted by Plaintiffs Patricia J. Davis (“Davis”), Patricia A.
Duncan (“Duncan”), and Jeffrey Goergen (“Goergen”) on the issue of whether Duncan and
Goergen were employees of the Foundation or independent contractors; the Motions in
Limine (Filing No. 141) submitted by the Foundation and Hugo Enterprises; the Plaintiffs’
Motion in Limine to Exclude Testimony and other Evidence Regarding Matters Defendants
Claimed are Protected by the Attorney-Client Privilege & Work Product Doctrine (Filing No.
148); the Plaintiffs’ Motion in Limine to Exclude Testimony and Other Evidence Regarding
Unemployment Benefits and Moonlighting Income (Filing No. 151); the Plaintiffs’ Motion
in Limine to Exclude Evidence Regarding Bankruptcy and Criminal Charges (Filing No.
154); the Plaintiffs’ Motion in Limine to Exclude Irrelevant Communications Regarding
Plaintiff Patricia Davis’ Diary (Filing No. 157); and Plaintiffs’ Motion in Limine to Exclude
Witnesses Pursuant to F.R.E. 615 (Filing No. 159).
Because the Foundation at all times had fewer than fifteen employees, and because
the Court concludes that the Foundation and Hugo Enterprises were not joint,
consolidated, or integrated employers, the Defendants’ Motion for Summary Judgment will
be granted, and the remaining motions will be denied as moot.
STANDARD OF REVIEW
“Summary judgment is appropriate when the record, viewed in the light most
favorable to the non-moving party, demonstrates there is no genuine issue of material fact
and the moving party is entitled to judgment as a matter of law.” Gage v. HSM Elec. Prot.
Servs., Inc., 655 F.3d 821, 825 (8th Cir. 2011) (citing Fed. R. Civ. P. 56(c)). The court will
view “all facts in the light most favorable to the non-moving party and mak[e] all reasonable
inferences in [that party's] favor.” Schmidt v. Des Moines Pub. Sch., 655 F.3d 811, 819
(8th Cir 2011). “[W]here the nonmoving party will bear the burden of proof at trial on a
dispositive issue . . . Rule 56(e) permits a proper summary judgment motion to be opposed
by any of the kinds of evidentiary materials listed in Rule 56(c), except the mere pleadings
themselves.” Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986). The moving party need
not negate the nonmoving party’s claims by showing “the absence of a genuine issue of
material fact.” Id. at 325. Instead, “the burden on the moving party may be discharged by
‘showing’ . . . that there is an absence of evidence to support the nonmoving party’s case.”
In response to the movant’s showing, the nonmoving party’s burden is to produce
specific facts demonstrating “‘a genuine issue of material fact' such that [its] claim should
proceed to trial.” Nitro Distrib., Inc. v. Alticor, Inc., 565 F.3d 417, 422 (8th Cir. 2009)
(quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986)).
The nonmoving party “'must do more than simply show that there is some metaphysical
doubt as to the material facts,' and must come forward with 'specific facts showing that
there is a genuine issue for trial.'” Torgerson v. City of Rochester, 643 F.3d 1031, 1042
(8th Cir.) (quoting Matsushita, 475 U.S. at 586-87)), cert. denied, 132 S. Ct. 513 (2011).
“'[T]he mere existence of some alleged factual dispute between the parties'” will not defeat
an otherwise properly supported motion for summary judgment. Quinn v. St. Louis Cnty.,
653 F.3d 745, 751 (8th Cir. 2011) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
In other words, in deciding “a motion for summary judgment, 'facts must be viewed
in the light most favorable to the nonmoving party only if there is a “genuine” dispute as to
those facts.'” Ricci v. DeStefano, 557 U.S. 557, 586 (2009) (quoting Scott v. Harris, 550
U.S. 372, 380 (2007)). Otherwise, where the Court finds that “the record taken as a whole
could not lead a rational trier of fact to find for the non-moving party”–where there is no
“'genuine issue for trial'”–summary judgment is appropriate. Matsushita, 475 U.S. at 587
(quoting First Nat'l Bank of Ariz. v. Cities Serv. Co., 391 U.S. 253, 289 (1968)).
The Plaintiffs’ Amended Complaint (Filing No. 38) presents six claims.1 Claim I
In August 2011, the Defendants moved to dismiss the Plaintiffs’ original
Complaint, asserting that each Plaintiff worked for the Foundation, either as an employee
or as an independent contractor, and that the Foundation at all times had fewer than fifteen
asserts that the Defendants subjected Davis and Duncan to a hostile work environment
and quid pro quo sexual harassment in violation of Title VII of the Civil Rights Act of 1964,
42 U.S.C. § 2000e, et seq. Claim II asserts that the Defendants retaliated against Davis
and Duncan in violation of Title VII by perpetuating the hostile work environment and by
terminating them. Claim III asserts that the Defendants retaliated against Davis and
Goergen (Davis’s son) by terminating Goergen’s employment in violation of Title VII. Count
IV asserts that the Defendants subjected Davis and Duncan to a hostile work environment
in violation of the Nebraska Fair Employment Practices Act, Neb. Rev. Stat. § 48-1102(2)
(“NFEPA”). Count V asserts that the Defendants retaliated against Davis and Duncan, in
violation of NFEPA, by perpetuating a hostile work environment and terminating their
employment. Count VI asserts that the Defendants retaliated against Davis and Goergen
in violation of NFEPA, by terminating Goergen’s employment.
In their Amended Complaint, the Plaintiffs also named as a Defendant ADP
TotalSource, Inc. (“ADP”), a Florida corporation, alleging:
Upon information and belief, ADP TotalSource and Opportunity Education
and/or Hugo Enterprises entered into a contractual relationship whereby
ADP TotalSource and Opportunity Education became co-employers/joint
employers of Plaintiffs and the other employees working for Opportunity
Education, and ADP TotalSource contractually assumed various employment
responsibilities and risks including the handling of employees’ wrongful
employment practices complaints.
(Am. Compl., Filing No. 38 at ¶ 14.)
Although the Amended Complaint alleged that “[the Foundation], Hugo Enterprises
employees and was not an “employer” under Title VII or NFEPA. In November 2011, this
Court denied the Defendants’ Motion to Dismiss, and declined to consider evidentiary
materials outside the pleadings and convert the motion to one for summary judgment,
instead allowing discovery to proceed. (See Mem. & Order, Filing No. 25.)
and ADP TotalSource are coemployers/joint employers for purposes of Title VII and the
NFEPA” (id. at ¶ 20), the Plaintiffs later moved to dismiss ADP as a party defendant in this
case. All claims against ADP were dismissed, with prejudice, on January 2, 2013. (Order,
Filing No. 94.) The Amended Complaint further alleged that Hugo Enterprises and the
Foundation are “an integrated employer” for purposes of Title VII and the NFEPA. (Filing
No. 38 at ¶ 19.)
Discovery is now complete and the Foundation and Hugo Enterprises have moved
for summary judgment, asserting that (1) the Foundation did not have fifteen or more
employees, a prerequisite to liability under both Title VII and NFEPA, and the Foundation
and Hugo Enterprises were not joint or integrated employers such that their employees can
be grouped for purposes of Title VII and NFEPA; (2) Duncan and Goergen were
independent contractors, not employees, and therefore not covered by Title VII and
NFEPA protections; (3) the alleged sexual harassment of Duncan and Davis ended once
they brought their concerns to the attention of the Foundation’s management; (4) the
alleged harassment suffered by Duncan and Davis was not severe or pervasive, and (5)
the Foundation’s decision to terminate Davis’s employment and to end Duncan’s and
Goergen’s service contracts were business decisions and not retaliatory.
While genuine issues of fact may remain regarding the Defendants’ last four
assertions, the Court concludes that summary judgment for the Defendants is warranted.
The undisputed facts demonstrate that the Foundation at all times had fewer than fifteen
employees; and, based on undisputed facts, this Court finds as a matter of law that the
Foundation and Hugo Enterprises were not a joint, consolidated, or integrated employer
such that their employees may be grouped for purposes of Title VII and NFEPA.
The Defendants’ Statement of Undisputed Material Facts (Filing No. 111-1 at 1-55),
with pinpoint citations to the evidentiary record in compliance with NECivR 56.1(a)(2), and
Plaintiffs’ responses (Filing No. 130 at 93-132), submitted in compliance with NECivR
56.1(b)(1), reveal that the following material facts are not in dispute. 2
The Foundation is a non-profit, tax-exempt corporation with its principal place of
business in Omaha, Nebraska. It provides educational support and materials to teachers
in more than 1,000 schools, serving more than 500,000 children, in developing countries.
Joe Ricketts (“Ricketts”) established the Foundation and serves as its Chief Executive
Hugo Enterprises is a limited liability company, owned and funded by Ricketts, with
its principal place of business in Denver, Colorado. Hugo Enterprises operates as a
holding company for Ricketts’s various for-profit businesses, and provides certain
administrative services such as accounts payable, accounts receivable, payroll
administration, benefits coordination, and some legal and human resources services, to
the Foundation and other of Ricketts’s charitable enterprises. The Foundation and Hugo
Enterprises have separate articles of incorporation, and operating agreements or by-laws.
The Foundation files a separate tax return with the Internal Revenue Service, and Hugo
Enterprises is a “disregarded entity” for tax purposes, reporting a portion of its expenditures
on the schedules of Ricketts’s personal tax return. Although the Plaintiffs contend that
Unless otherwise specified, the facts recited herein relate to the times relevant to
the Plaintiffs’ claims. The Court has also considered the Plaintiffs’ separate statement of
material facts (Pls.’ Br., Filing No. 130, at 2-93) and the Defendants’ responses thereto
(Defs.’ Reply Br., Filing No. 138, 36-115).
Hugo Enterprises acted as a holding company for the Foundation, the Plaintiffs cite only
to Ricketts’s deposition at 25:13-26-26:12 and 28:11-19 in support of that contention.
Ricketts’s deposition testimony designated by the Plaintiffs simply notes that Hugo
Enterprises provided administrative infrastructure for the nonprofit enterprises funded by
Ricketts, keeping books and paying bills. (Filing No. 131-10 at 7.)
ADP TotalSource, Inc. (“ADP”), is a professional employer organization (“PEO”), that
provided payroll, human resources, and employee benefits services to the Foundation
pursuant to a contractual relationship that began in November 2008.
Davis began working with the Foundation as a volunteer in 2005, and her
relationship with the Foundation was governed by a consulting agreement. She assisted
in developing educational curriculum and finding teachers and students for educational
videos. She also worked with vendors to purchase educational materials to send to
schools in developing countries. In August 2007, Davis applied for and was awarded fulltime employment with the Foundation as its Director of Education, an “at will” position with
an annual salary of $60,000. In December 2008, the Foundation, acting through its C.E.O.
Ricketts, terminated Davis’s employment, because Ricketts perceived that Davis’s divorce
from one of the Foundation’s vendors was having an adverse effect on Foundation
operations. In early 2009, Ricketts conducted a search for candidates to fill the position
of Director of Education, and Davis applied for the position. She was rehired on April 1,
Upon recommendation by Davis, the Foundation contracted with her friend Duncan
to work as a consultant for the Foundation beginning in June 2008. Duncan had an M.B.A.
and was working toward a Ph.D. in education. She signed a consulting agreement with the
Foundation on June 4, 2008, providing, inter alia, that she was an independent contractor,
not an employee, and that she was free to contract with and provide services to other
companies or organizations. Duncan helped identify and recruit American schools for the
Foundation’s sister school pen pal program; worked with new sister schools to set up pen
pal relationships with target schools; and served as the point of contract for questions and
concerns posed by current and potential sister schools.
In January 2009, Davis told her son, Goergen, that the Foundation needed a
contract worker to perform services in its warehouse. Goergen worked at the Foundation’s
warehouse from January 2009 to late 2010, packing teaching supplies in boxes to be
shipped to target schools in developing nations.
Like Duncan, Goergen signed a
consulting contract with the Foundation, agreeing that he was an independent contractor
and not an employee of the Foundation.
In the United States, the Foundation employed a total of four employees in 2008;
six employees in 2009; and seven employees in 2010. While the Plaintiffs assert that the
Foundation had other employees overseas and in the United States for purposes of Title
VII and NFEPA, they cite only to the Deposition of Jayson Graham at 32:1-12 in support
of that contention. (See Pls.’ Br., Filing No. 130, p. 96, ¶ 21.) Graham’s deposition
testimony designated by the Plaintiffs simply notes that, at an unspecified time, the
Foundation had one employee in India and one employee in Tanzania. (Filing No. 131-18
Foundation employees reported to and were supervised by the Foundation’s
management employees. Decisions related to the hiring or firing of Foundation employees,
their work schedules and rates of pay, and decisions related to services provided to the
Foundation by contractors or consultants, were made by Ricketts as C.E.O. of the
Foundation. Although the Plaintiffs contend that Foundation employees were sometimes
required to report to Hugo President and General Counsel Alfred Levitt (“Levitt”)3 and Hugo
Chief of Staff Mark Simmons (“Simmons”), the Plaintiffs cite only to Ricketts’s deposition
at 31:6-32:8 in support of that contention. Ricketts’s deposition testimony designated by
the Plaintiffs does not support their contention. (Filing No. 131-10 at 8.)
Until July 2009, Davis reported to the Foundation’s Executive Director Alan Barkley
(“Barkley”), who was based in California and typically visited Omaha quarterly. On July 1,
2009, Ricketts hired Michael Morsches (“Morsches”) as Chief Operations Officer of the
Foundation, and Davis then reported to Morsches.
Davis and Duncan questioned
Morsches’s credentials and his attitude toward women and, in July 2009, they met with
Ricketts’s brother, Jim Ricketts (“Jim”), a part-time employee of the Foundation, to voice
their concerns. Jim relayed the information to Ricketts, and Jim expressed his regret that
Davis had been rehired.
After Morsches began work as COO of the Foundation, Davis and Duncan had
many criticisms of his work performance and his conduct, and Morsches and Ricketts had
many criticisms related to the performance of Davis and Duncan. In mid to late August
2009, Duncan contacted Barkley to discuss Morsches, and made allegations that
Morsches engaged in inappropriate sexual conduct. The same day, Barkley called Davis
to discuss Morsches, and Davis described conduct by Morsches that she considered to be
Levitt was employed by Hugo Enterprises as General Counsel from 2007, and,
in 2009, became President of Hugo Enterprises, in addition to serving as General Counsel.
In December 2009, Levitt also became Secretary and General Counsel of the Foundation,
providing legal counsel and services to both Hugo Enterprises and the Foundation.
inappropriate. The same day, Barkley called Simmons and summarized what Davis and
Duncan told him. Simmons passed the information along to Levitt, and Levitt called
Barkley to discuss the concerns. Levitt then emailed and called Davis to discuss her
concerns, asked her to put the concerns in writing, and assured Davis that the Foundation
took the complaints seriously and would investigate. Levitt also called Duncan to discuss
her concerns, and asked her to put her concerns in writing. On August 24, Davis submitted
her written statement to Levitt. On August 25, Duncan submitted her written statement to
Levitt. Levitt and Ricketts investigated the complaints.
On August 31, 2009, Ricketts informed Duncan that her services were no longer
needed, although Levitt and Ricketts continued to meet with Duncan to review her
complaints about Morsches.
Levitt and Ricketts met with Morsches on September 1, 2009, to confront him with
the allegations. Morsches responded to the allegations, admitting that he made certain
statements and denying others. Ricketts met with both Davis and Morsches on September
4, 2009, and Morsches apologized to Davis and stopped making sexual comments and
innuendos at the workplace. Nonetheless, Davis and Morsches continued to have a
strained working relationship, with many criticisms of each other’s work performance. On
November 15 or 16, 2009, Davis called ADP’s hotline regarding Morsches’s conduct. She
then submitted a written statement to ADP, which ADP forwarded to Simmons. In
November 2009, Levitt learned that Davis alleged Morsches retaliated against her because
of her complaint of harassment, and Levitt referred the matter to an outside law firm for
investigation. On November 18, 2009, Ricketts advised Morsches and Davis that they
would both be placed on administrative leave pending the completion of the investigation.
An attorney with the law firm conducted an investigation and provided his conclusions to
Levitt and Ricketts on December 11, 2009, including his opinion that there had been no
unlawful retaliation against Davis and that both Morsches and Davis were contributing to
an unproductive atmosphere in the workplace. The attorney also advised Ricketts of
several comments made by Davis in her journal that she showed the lawyer, including
comments to the effect that she “loathed” Ricketts and lost “every shred of respect” she
had for him. Following the December 11, 2009, discussion, Ricketts decided to terminate
both Morsches and Davis. Ricketts directed Levitt to communicate to Davis the decision
to terminate her employment. On December 16, 2009, the attorney and Levitt called Davis.
The attorney explained to Davis the conclusions he reached following his investigation, and
Levitt informed Davis of her termination and that the termination was based on her work
performance and her view of Ricketts. On December 18, 2009, Ricketts called Morsches
and informed him that his employment with the Foundation was terminated.
On December 14, 2010, Graham told Goergen that his services were no longer
needed, effective December 16, 2010.
The requirement that a defendant employer have fifteen or more employees is an
element of a plaintiff’s claim under Title VII and NFEPA.
See 42 U.S.C. § 2000e(b); Neb.
Rev. Stat. § 48-1102(2)4; Arbaugh v. Y&H Corp., 546 U.S. 500, 504 (2006). While it is
The Nebraska Supreme Court has said, “[b]ecause the NFEPA is patterned from
that part of the Civil Rights Act of 1964 contained in 42 U.S.C. §§ 2000e et seq. (1976), it
is appropriate to look to federal court decisions construing similar and parent federal
legislation.” Father Flanagan's Boys' Home v. Agnew, 590 N.W.2d 688, 693 (Neb. 1999)
(quoting Airport Inn v. Neb. Equal Opp. Comm., 353 N.W.2d 727, 731 (Neb. 1984)).
recognized that when “satisfaction of an essential element of a claim for relief is at issue,
. . . the jury is the proper trier of contested facts,” id. at 514, when uncontested facts
demonstrate that a plaintiff cannot satisfy an essential element of a claim, summary
judgment is warranted.
Here, the Plaintiffs’ Title VII and NFEPA claims must be dismissed if the Foundation
did not have fifteen or more employees at the times relevant to the Plaintiffs’ claims, unless
the Plaintiffs can demonstrate that the Foundation and Hugo Enterprises were a joint,
consolidated, or integrated employer for purposes of Title VII and NFEPA.
Even if Duncan and Goergen were counted as employees of the Foundation, and
not independent contractors, the undisputed evidence shows that the Foundation had
fewer than fifteen employees at all times relevant to the Plaintiffs’ claims. The Plaintiffs
have abandoned their claim that the Foundation and ADP were a joint, consolidated, or
integrated employer for purposes of Title VII and NFEPA. No genuine issues of material
fact remain for a jury to address with respect to the relationship between the Foundation
and Hugo Enterprises. The question is whether the two entities are–or are not–a single
employer for purposes of Title VII and NFEPA. Four Eighth Circuit decisions guide this
Court in making that determination.
In Baker v. Stuart Broad. Co., 560 F.2d 389, 392 (8th Cir. 1977), the Eighth Circuit
announced that several factors should be considered when determining whether entities
should be viewed as a consolidated employer for purposes of Title VII: Interrelation of
operations, common management, centralized control of labor relations, and common
ownership or financial control. Because the legal standard was newly adopted, the Eighth
Circuit remanded the matter to the district court for further proceedings.
In Artis v. Howell, 161 F.3d 1178, 1184 (8th Cir. 1998), the Eighth Circuit noted that
all four factors listed in Baker are to be considered, with no one factor controlling. Based
on the “totality of the circumstances,” the Eighth Circuit held that the district court correctly
concluded that an employer should not be consolidated with an associated entity to meet
Title VII’s employee numerosity requirement, despite some common management and
some overlap in the entities’ control of labor relations. The district court’s grant of summary
judgment for the defendant employer was upheld.
In Brown v. Fred’s Inc., 494 F.3d 736, 739 (8th Cir. 2007), the plaintiff suggested
that her employer and its parent company should be viewed as a single entity to satisfy
Title VII’s employee numerosity requirement. The parent company processed payroll and
performed other services for its subsidiary, the plaintiff’s employer. The parent company’s
name appeared on the plaintiffs’ payroll checks and other documents, such as the
employee handbook. The manager who hired the plaintiff thought he worked for the parent
company and that the two companies were one and the same. The Eighth Circuit held that
the “strong presumption that a parent company is not the employer of its subsidiary’s
employees” may be overcome “only in extraordinary circumstances.” Id. (quoting Frank
v. U.S. West, Inc., 3 F.3d 1357, 1362 (10th Cir. 1993)) (citing Johnson v. Flowers Indus.
Inc., 814 F.2d 978, 981 (4th Cir. 1987)). Without addressing the Baker factors, the court
concluded that a parent company may be viewed as the employer of its subsidiary’s
employees for purposes of the Title VII numerosity requirement “if (a) the parent company
so dominates the subsidiary’s operations that the two are one entity and therefore one
employer, or (b) the parent company is linked to the alleged discriminatory action because
it controls individual employment decisions.” Id. (internal citations and quotation marks
omitted). The Brown court found that the plaintiff’s evidence of interrelation of corporate
operations was insufficient to create a genuine issue for trial with respect to “either
circumstance” (the parent company’s domination or its link to the alleged discriminatory
action). Id. at 739-40. The district court’s entry of summary judgment for the defendants
on the plaintiff’s Title VII claim was affirmed. Id. at 740.
In Sandoval v. Am. Bldg. Maint. Indus., Inc., 578 F.3d 787, 796 (8th Cir. 2009), the
Eighth Circuit “harmonized” its earlier decisions by holding that the four Baker factors
should be considered to determine “corporate dominance over a subsidiary’s operations
and establish affiliate liability.” Although the Sandoval court was addressing general
principals of corporate liability under Title VII, and not the employee numerosity
requirement, its analysis provides guidance. The Sandoval court found that “evidence of
common ownership and management of [the parent and subsidiary]; [the parent’s]
involvement, pursuant to [a service agreement], in several areas of [the subsidiary’s]
operations; and [the parent’s] public representations of centralized corporate control of
labor and human resources, demonstrate [the parent] is the [plaintiff’s] employer for
purposes of the integrated enterprise test.” Id. at 795-96. Accordingly, the Eighth Circuit
reversed the district court’s entry of summary judgment on the issue of whether the parent
corporation and its subsidiary were an “integrated enterprise” under Title VII. Id. at 800.
Here, Hugo Enterprises is not a parent corporation to the Foundation, and the
Foundation is not its subsidiary. The Foundation is a charitable, non-profit organization
that has observed the requisite tax-exempt corporate formalities. Here, as in Brown, the
non-employer company (Hugo Enterprises) processed payroll and performed other
services for the employer company (the Foundation). Here, as in Artis, there was some
common management and some overlap in the entities’ control of labor relations, in that
Ricketts was the final decision-maker in both entities and he enlisted the assistance of
Levitt, Hugo’s General Counsel, to assist in the investigation of Davis’s and Duncan’s
Nonetheless, the Plaintiffs reported to managers employed by the
Foundation; they ultimately were accountable to Ricketts as C.E.O. of the Foundation; and
there is no evidence that any Plaintiff at any time performed any services for Hugo
Enterprises. Considering the four Baker factors–interrelation of operations, common
management, centralized control of labor relations, and common ownership or financial
control–under the totality of the circumstances and with no one factor controlling, this Court
concludes that Hugo Enterprises did not so dominate the Foundation’s operations that the
two were one entity and one employer. Nor is there evidence that Hugo Enterprises was
linked to the alleged discriminatory actions by controlling individual employment decisions.
There is evidence that one man–Joe Ricketts–exercised ultimate decision-making authority
for both Hugo Enterprises and the Foundation.
It is recognized that Title VII “is to be accorded a liberal construction in order to carry
out the purposes of Congress[.]” Baker, 560 F.2d at 391 (quoting Parham v. Sw. Bell Tel.,
433 F.2d 421, 425 (8th Cir. 1970)). “Such liberal construction is also to be given to the
definition of ‘employer.’” Id. It is also recognized that Congress did not intend for Title VII
to be applied to employers with fewer than fifteen employees, nor did the Nebraska
legislature intend for NFEPA to be applied to such employers. One person’s exercise of
ultimate control over two otherwise distinct corporate entities is insufficient to overcome the
The Court finds evidence of Simmons’s involvement in the chain of events to be
inconsequential, as he was not a decision-maker and it appears that he simply passed
along information that was relayed to him.
strong presumption of their corporate separateness and cause the two entities to be
viewed as a joint, consolidated, or integrated employer for purposes of satisfying Title VII’s
and NFEPA’s employee numerosity requirements.
At all times relevant to the Plaintiffs’ claims, the Foundation had fewer than fifteen
employees. No genuine issues of material fact remain for a jury to decide regarding the
relationship between the Foundation and Hugo Enterprises as alleged joint, consolidated,
or integrated employers. This Court concludes they are not. Because the Plaintiffs cannot
satisfy an essential element of their actions under Title VII and NFEPA, i.e., that the
Foundation was an “employer” as defined in Title VII and NEFPA, summary judgment will
be granted in favor of the Defendants and the Plaintiffs’ claims will be dismissed.
IT IS ORDERED:
1. The Defendants’ Motion for Summary Judgment (Filing No. 102) is granted;
2. The Plaintiffs’ Motion for Partial Summary Judgment (Filing No. 105); the
Defendants’ Motions in Limine (Filing No. 141); the Plaintiffs’ Motion in Limine to
Exclude Testimony and other Evidence Regarding Matters Defendants Claimed are
Protected by the Attorney-Client Privilege & Work Product Doctrine (Filing No. 148);
the Plaintiffs’ Motion in Limine to Exclude Testimony and Other Evidence Regarding
Unemployment Benefits and Moonlighting Income (Filing No. 151); the Plaintiffs’
Motion in Limine to Exclude Evidence Regarding Bankruptcy and Criminal Charges
(Filing No. 154); the Plaintiffs’ Motion in Limine to Exclude Irrelevant
Communications Regarding Plaintiff Patricia Davis’ Diary (Filing No. 157); and
Plaintiffs’ Motion in Limine to Exclude Witnesses Pursuant to F.R.E. 615 (Filing No.
159) all are denied as moot;
3. All other pending motions are denied as moot; and
4. A separate Judgment will be entered.
DATED this 5th day of June, 2013.
BY THE COURT:
S/Laurie Smith Camp
Chief United States District Judge
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