Costenbader v. Classic Design Homes, Inc. et al

Filing 59

MEMORANDUM -For the above reasons, the Court will deny Defendant's Motion for Summary Judgment. An appropriate order follows. Signed by Honorable Robert D. Mariani on 4/11/12. (jfg)

THE UNITED STATES DISTRICT COURT

FOR THE MIDDLE DISTRICT OF PENNSYLVANIA

ANDREA COSTENBADER
Plaintiff

v.

3:08·CV·2329
(JUDGE MARIANI)

DES, PROPERTIES, INC. d/b/a
CLASSIC QUALITY HOMES, INC.
Defendant
MEMORANDUM AND ORDER
I. Introduction

Before the Court is Defendant's Motion for Summary Judgment. (Doc. 43). For the
reasons set forth below, the Court will deny the motion.
II. Statement of Facts and Procedural History
In June 2007, David and Emma Wengerd purchased a home construction company
from Plaintiffs previous employer, Raymond Bender ("Bender"), who continued to have
access to part of the office until December 31, 2007. (Doc. 51, Ex. F, Asset Purchase
Agreement).1 Under Bender, Plaintiff had been a receptionist, but David promoted her to
office manager soon after the sale. (Minutes Sheet, Doc. 44, Ex. F; Costenbader Dep.,
Doc. 44, Ex. E, 97:10-14). Plaintiff alleges that this promotion displeased Maureen Perih, a

1 "Possession of Premises and Vehicles shall be delivered to Buyers on the Closing Date, except that the
Sellers reserve free of any rent or charge the right to occupy and use two (2) rooms in the sales office for their own
purposes until no later than December 31, 2007." (Id. at ~ 5).

saleswoman. Perih allegedly then spent the next several months trying to persuade David

to fire Plaintiff. (DW1 Dep., Doc. 44, Ex. C, 94:4-17).
Between June and November 2007, David was allegedly aware of Bender's violent
tendencies. He himself described Bender as "scary." (ld. at 62:23-63:1).2 AnnMarie
Gentile (the plaintiff in the companion case) stated that she had informed David about
Bender's sexual comments and inappropriate touching soon after he bought the company.
(Gentile Dep., Doc. 51, Ex. I, 152:4-153:12; 159:1-6).
On November 7,2007, Bender "proceeded to rub himself up and down [Plaintiffs]
body." (Costenbader Dep., Doc. 44, Ex. E, 29:9-11). When Plaintiff left the room, Bender
followed her and "continue[d] to touch [Plaintiff] inappropriately." (/d. at 30:1-3). Plaintiff
alleged at her deposition that David witnessed the first incident but not the second. (ld. at
29:9, 30:4-6). Plaintiff stated that she did not speak to David about the inappropriate
touchings on November 7, but Gentile did. (Id. at 30:7-9).
On the 9th, Bender returned to DES and allegedly sexually assaulted Costenbader
by shoving his hand down her pants and grabbing her buttocks. (Police Statement, Doc.
44, Ex. H). After the incident, two co-workers, (Gaito and Knott) advised Plaintiff to call the
police. Knott also told Bender to leave the premises, and Bender did not return that day.

2 1n deciding Defendant's Motion for Summary Judgment, the Court does not rely on any references to
David Wengerd's deposition that Plaintiff states is located at Doc. 51, Ex. A. That document is Emma Wengerd's
deposition, and so any of Plaintiffs citations to David Wengerd's deposition at that location are incorrect and
unverifiable unless contained in Defendant's excerpts from the same deposition, located at Doc. 44, Ex. C. For
instance, in his deposition, David Wengerd is said to have acknowledged that he had received reports of Bender's
violent tendencies and his disposition towards women long before the events of November 2007. See Plaintiffs
Answer to Defendant's Statement of Facts (Doc. 50, 1133, n.13).

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(Costenbader Dep., Doc. 44, Ex. E, 91 :18-94:22). Following Bender's assault on Plaintiff,

Gentile called the police. Both Costenbader and Gentile submitted statements to the police
on the 10th. (Doc. 44, Ex. H). David was not on the premises at the time of the assault, but
he came in later that day and found out what had happened. (DW1 Dep., Doc. 44, Ex. C,
71 :12-72:7). He said that Knott "stepped in and we decided we should keep [Bender] off the
property." (Id. at 115:19-21). Knott claims that the Wengerds "refused to believe Ms.
Costenbader and Ms. Gentile, and sided with Mr. Bender. {Knott Aff., Doc. 51, Ex. J, 1m 19­
20). 3 David admitted he did not conduct an independent investigation because he felt the
police were better equipped to handle the matter. (DW1 Dep., Doc. 44, Ex. C, 118:5-11).
David acknowledged that Gentile had told him about Bender's conduct and Plaintiffs
complaints. (DW2 Dep., Doc. 51, Ex. B, 49:9-51 :4). However, after his conversation with
Gentile, David admitted he did not approach Bender about it because "Bender was like
$50,000,000 and I would have been a little guy. I would never dare say anything to
Bender." (DW1 Dep., Doc. 44, Ex. C, 61 :4-8). He then said he did not do anything after the
conversation with Gentile "because [Gentile] put me under the impression that all you had to
do was tell him to leave and he would go. So I didn't think it was anything serious at this
point." (ld. at 61 :11-14). David admitted that when Gentile told him about Bender's
conduct, he understood her to mean that both she and Plaintiff were bothered by it. David
also said that he did not fully believe Gentile because "I guess my idea would have been
3 Knott was also terminated in August 2009 and at the time of his affidavit was involved in a lawsuit
against DES for commissions he claims he never received. Id. at ~~ 33-34.

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that, if you want to bother somebody, you would bother some different type of person." To

clarify his answer he stated, "I guess somebody a little more attractive." (DW2 Dep., Doc.
51, Ex. B, 51 :12-21). He also admitted that he told his wife about the November 9 incident
and said, "I don't think Ray Bender would bother because she stinks and she's too fat." (Id.
at 59:19-21). His wife confirmed that he had stated "[Plaintiff] smells and he wouldn't know
who would want her." (EW Dep., Doc. 51, Ex. A, 48:7-8).
Bender returned to the offices on November 13, 2007, asking "Where is she?"
ostensibly referring to Plaintiff (Costenbader Dep., Doc. 44, Ex. E, 40:6-7). Asalesman
(Hanyon) distracted Bender and got him out of the office by directing him to the warehouse.
(ld. at 41 :8-14). Bender did not return, and Plaintiff had no contact with him that day. (Id. at

40:16-18,41:13-15). After Bender left, David told Plaintiff she could go home on
administrative leave with pay until David delivered aletter to Bender telling him to stay away
from the office. (Id. at 43:16-44:17). He also allegedly apologized for "putting his money
ahead of us girls," (ld. at 46:16-18). Costenbader alleges that David delayed delivering the
letter until after he had closed sales on some of Bender's houses. (DW1 Dep., Doc. 44, Ex.
C, 116:13-17; 116:24-117:14). Costenbader stayed home for the next two days.
(Costenbader Dep., Doc. 44, Ex. E at 59:10-13). On the 15th, Plaintiff called David to ask
about the letter, and David confirmed that he had personally delivered the letter to Bender.4
However, David said he still feared for her safety, so he told her to stay at home for another
4 Defendant has not produced this letter as evidence because David's copy was allegedly destroyed in a
fire at the office. His attorney who drafted the letter has a brain tumor and has been unable to produce it. (OWl
Dep., Doc. 44, Ex. C, 116:19-23).

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week with pay (/d. at 59:20-60:3). Plaintiff returned to work the next day (16th), because
Gentile told her that David was planning to fire her for abandoning her job. (ld. at 69:6-24,
75:10; Gentile Dep., Doc. 51, Ex. I, 178:1-19). Plaintiff was terminated on the 17th.
(Costenbader Dep., Doc. 44, Ex. E, 64:21-23). Maureen Perih informed Plaintiff she was
being laid off temporarily, and David confirmed the layoff when Plaintiff called him that night.
(ld. at 78:14-79:10; DW1 Dep., Doc. 44, Ex. C, 112:9-113:5). David stated that although he

was the final decision-maker to fire Plaintiff, it was more of Perih's decision. (DW1 Dep.,
Doc. 44, Ex. C, 91 :4-5). "I felt that we didn't need three girls in the office and because there
was much conflict I let Maureen pick her." (ld. at 110:16-18; see also Costenbader Dep.,
Doc. 44, Ex. E, 80:17-24).
Defendant's stated reasons for firing Costenbader were that (1) she was lazy and
caused trouble in her role as office manager, (2) her lifestyle as a "swinger" conflicted with
Defendant's Christian values, and (3) there was not enough work to justify her presence.
David Wengerd testified that multiple people complained about Costenbader in her
new role as office manager. (DW1 Dep., Doc. 44, Ex. C, 91:6-92:1). Later in his deposition,
however, David said, "I think Andrea wasn't as bad as the salesmen made it sound." (Id. at
92:7-9). Furthermore, David admitted that he had never given any warnings or reprimands
to Plaintiff about her leisure reading while at work or her chatter with the secretary. (ld. at
104:4-105:7).

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With respect to Costenbader's alternative lifestyle, David says that Gaito told him in

July 2007, soon after David bought DES. (Id. at 107:10-13). Defendant also attached
photoshots of websites as exhibits to their motion for summary judgment. These website
shots show Plaintiffs profile and postings on Swing Life Style. (Doc. 44, Ex. G). However,
apart from a notice that Plaintiff had been a member of the site since April 2007, all the
postings were 'from 2009 and 2010, well after Costenbader was terminated. Furthermore,
they were printed from the website the day of Costenbader's deposition (October 5,2010).
David testified at his deposition that his wife pestered him daily to fire Costenbader because
she did not want Plaintiff around her son, Steven. (DW1 Dep., Doc. 44, Ex. C, 105:20-24,
111 :19-112:3). However, Emma testified at her deposition that she did not think she told
her husband to do anything about Costenbader upon finding out she was a swinger and that
"[i]t was ok with me." (EW Dep., Doc. 51, Ex. D, 66:1-4; 88:14-17).
Finally, within a week of laying off Costenbader on November 17, 2007, Defendant
hired a replacement, Megan Perih (Maureen's daughter), who worked nearly full-time hours.
(Gentile Dep., Doc. 51, Ex. I, 196:15-24; Costenbader Dep., Doc. 51, Ex. G, 102:15-24).
Plaintiff settled her case separately with Raymond Bender and withdrew the criminal
charges against him. (Doc. 44, Ex. L). The Second Amended Complaint (Doc. 23)
asserted five counts. However, Plaintiff indicated in her brief in opposition that she is
voluntarily withdrawing Counts III, IV, and VI (there was no Count V). She is also
withdrawing any claims against David and Steven Wengerd in their individual capacities.
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(Doc. 52, at 1, n.1). Thus, the only remaining claims are the sexual discrimination/hostile

work environment (I) and retaliation (II) claims against Defendant DES.

III.

Standard of Review on Motions for Summary Judgment

Through summary adjudication the court may dispose of those claims that do not
present a "genuine issue as to any material fact." FED. R. CIV. P. 56(a). Summary judgment
"should be rendered if the pleadings, the discovery and disclosure materials on file, and any
affidavits show that there is no genuine issue as to any material fact and that the movant is
entitled to judgment as a matter of law." FED. R. CIV. P. 56(c); Turner v. Schering-Plough

Corp., 901 F.2d 335,340 (3d Cir. 1990). "As to materiality, ... [o]nly disputes over facts that
might affect the outcome of the suit under the governing law will properly preclude the entry
of summary judgment." Anderson v. Uberty Lobby, Inc., 477 U.S. 242,248 (1986). The
party moving for summary judgment bears the burden of showing the absence of agenuine
issue as to any material fact. Celotex Corp.

V.

Catrett, 477 U.S. 317, 323 (1986). Once

such a showing has been made, the non-moving party must offer specific facts contradicting
those averred by the movant to establish agenuine issue of material fact. Lujan v. Nat'!

Wildlife Fed'n, 497 U.S. 871,888 (1990). "Inferences should be drawn in the light most
favorable to the non-moving party, and where the non-moving party's evidence contradicts
the movant's, then the non-movant's must be taken as true." 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).

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IV. Analysis

a. Count I: Sexual discrimination/hostile work environment
Plaintiff is alleging that Defendant took inadequate remedial measures in response to
Bender's conduct (Le. they failed to prevent a hostile work environment). To state aclaim
under Title VII for discrimination resulting from a hostile work environment, an employee
must show that:
(1) she suffered intentional discrimination because of her [sex]; (2) the
discrimination was severe or pervasive; (3) the discrimination detrimentally
affected her; (4) it would have detrimentally affected a reasonable person in
like circumstances; and (5) a basis for employer liability is present. s

Guthrie v. Baker, 583 F. Supp. 2d 668, 681 (W.O. Pa. 2008) {citing Jensen v. Potter, 435
F.3d 444, 453 (3d Cir.2006), overruled in pari on other grounds by Burlington N. & Santa Fe

Ry. v. White, 548 U.S. 53, 67-68,126 S.Ct. 2405,165 L.Ed.2d 345 (2006). Based on the
facts of record, Plaintiff has alleged Bender engaged in offensive sexual touching multiple
times, grabbing her breasts and buttocks, so upsetting her that she would vomit or hide in
the bathroom to avoid him. Such conduct could detrimentally affect a reasonable person in
similar circumstances, so Plaintiff can easily meet the first four elements of her claim.
Whether Defendant is liable is a more difficult question.
An employer is liable under Title VII for harassment of its employees by nonemployees such as Bender where it is aware of the problem and fails to take prompt and

5 The fifth element is usually "the existence of respondeat superior liability." Andreoli v. Gates, 482 F.3d
641,643 (3d Cir. 2007). However, in this case, Bender was not an agent of DES because he was no longer an owner
or employee. Plaintiff has specifically stated she is suing DES for direct, not vicarious, liability.

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appropriate corrective action. Faragher v. City of Boca Raton, 524 U.S. 775, 789, 118 S.Ct.

2275,2284 (1998) ("the combined knowledge and inaction may be seen as demonstrable
negligence, or as the employer's adoption of the offending conduct and its results, quite as if
they had been authorized affirmatively by the employer"). EEOC Guidelines also provide
that:
An employer may also be responsible for the acts of non-employees, with
respect to sexual harassment of employees in the workplace, where the
employer (or its agents or supervisory employees) knows or should have
known of the conduct and fails to take immediate and appropriate corrective
action.
29 C.F.R. § 1604.11 (d-e).
An employer can be liable for the harassing conduct of the victim's harasser if the
employer was "negligent or reckless in failing to train, discipline, fire or take remedial action
upon notice of harassment." See Andreoli, 482 F.3d at 644 (citing Bonenberger v. Plymouth

Twp., 132 F.3d 20, 26 (3d Cir.1997) and Bouton v. BMW of N. Am., Inc., 29 F.3d 103, 106
(3d Cir.1994)). Even if the remedial action does not stop the alleged harassment, it is
"adequate" if it is "reasonably calculated" to end the harassment. Knabe v. Boury Corp.,
114 F.3d 407, 412-13 (3d Cir.1997). The employer also has a duty to investigate whenever
it becomes aware of harassment. It is not essential for the victim of harassment to lodge a
formal or informal complaint. Meritor Sav. Bank, FSB v. Vinson, 477 U.S. 57, 72,106 S.Ct.
2399, 2408 (1986) ("Finally, we reject petitioner's view that the mere existence of a

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grievance procedure and a policy against discrimination, coupled with respondent's failure

to invoke that procedure, must insulate petitioner from liability.").
Bender's contract with Defendant allowed him access to two rooms in the sales
office until the end of 2007. (Doc. 51, Ex. F, Asset Purchase Agreement). Under
Pennsylvania law, the contract contained an implied duty of good faith and fair dealing, as
well as the doctrine of necessary implication. That doctrine, similar to the requirement of
good faith, has been described as follows:
In the absence of an express provision, the law will imply an agreement by
the parties to a contract ... to refrain from doing anything that would destroy
or injure the other party's right to receive the fruits of the contract.
Slater v. Pearle Vision Ctr., 546 A.2d 676, 679 (Pa. 1988); see also Slagan v. John
Whitman &Assocs., No. Civ.A. 97-3961, 1997 WL 587354, at *5 (E.D. Pa. Sept. 10, 1997)
(holding in a sexual harassment case that "Whether under the Restatement's implied duty of
good faith performance of a contract or the doctrine of necessary implication, ... Plaintiff's
employment contract contained the implied term that his conduct would be lawful.").
Though Bender was not an employee of Defendant, his contract with Defendant contained
an implied term that while on the business premises, his conduct would be lawful. Once
Bender allegedly breached that duty by sexually harassing Costenbader on November 7,
2007, at the very least, Defendant had a duty to investigate and prevent further harassment
to its employees. Faragher, 524 U.S. at 789; Meritor, 477 U.S. at 72; Andreoli, 482 F.3d at
644; Knabe; 114 F.3d at 412-13. Because Defendant cannot establish as a matter of law
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that he was either unaware of Bender's conduct or that it took prompt and adequate

remedial measures, the Court will deny its motion for summary judgment.
Though Costenbader did not directly complain to David of Bender's conduct of
November 7 (Gentile did), when he discussed the incidents with her on the 10th, she asked
him to keep Bender out of the office. (Costenbader Dep., Doc. 44, Ex. E, 38:7-39:3).
Moreover, following the events of November 9, Costenbader filed formal criminal charges
against Bender. (Doc. 44, Ex. H). Once David came to the office that day, he learned of
the day's events. (DW1 Dep., Doc. 44, Ex. C, 71 :12-72:7). Defendant cannot claim lack of
notice. Because Defendant was on notice, DES had a duty to investigate the problem.
However, David admitted he did not because he allegedly felt the police were better
equipped to handle it. (Id. at 118:5-11). He also stated he personally delivered a letter to
Bender warning him to stay off the property (Id. at 59:20-60:3), but Defendant has not
produced the letter yet. (Id. at 116:19-23). David also waited until closing on some of
Bender's homes before delivering the letter (Id. at 116:13-17; 116:24-117:14). He also
stated at his deposition that he would never dare to say anything against Bender because
David was a "little guy" and Bender was $50,000,000.00 (Id. at 61 :4-8), which is inconsistent
with his statement that he personally delivered the letter to Bender and told him to stay
away.
Though Bender and Costenbader had no contact when he returned to the office on
November 13, Bender was kept away from Costenbader not through the employer's action
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but because one of the salesman intervened to distract Bender. The employer itself took no

action to ensure Costenbader was insulated from Bender presence. (ld. at 40: 16-18, 41 :8­
15). Finally, whether David took Costenbader's complaints seriously is in grave doubt.
David's deposition testimony is replete with references to why he did not believe
Costenbader (e.g., she was too fat or smelly to be attractive to anyone). (DW2 Dep., Doc.
51, Ex. B, 51:12-21; 59:19-21; EW Dep., Doc. 51, Ex. A, 48:7-8).
Therefore, Plaintiff has sufficiently made out acase that DES did not take prompt or
adequate remedial measures to survive a motion for summary judgment. Drawing all
reasonable inferences in favor of Plaintiff, it appears that those who intervened to keep
Bender away were fellow co-workers who were not enforcing any policies against sexual
harassment, and David's own words belie his alleged concerns for Costenbader's safety.
b. Count II: Retaliation
To establish a prima facie case of retaliation, a plaintiff must establish: (1) that she
engaged in protected activity; (2) an adverse action was taken; and (3) there was a causal
connection between the protected activity and the adverse action. Thomas v.

Independence Twp., 463 F.3d 285,296 (3d Cir. 2006). Protected activities under Title VII
include situations where an employee "has made a charge, testified, assisted, or
participated in any manner in an investigation, proceeding, or hearing under" 42 U.S.C. §
2000e-3(a). "In certain narrow circumstances, an 'unusually suggestive' proximity in time
between the protected activity and the adverse action may be sufficient, on its own, to
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establish the requisite causal connection." Marra v. Philadelphia Housing Auth., 497 F.3d

286, 302 (3d Cir. 2007). The alleged instances of Bender's harassment occurred on
November 7 and 9, 2007. Along with Gentile, Costenbader filed criminal charges against
Bender and submitted awitness statement on November 10, 2007. On November 17,
2007, Costenbader was terminated. The temporal link weighs in favor of finding causation.
If the employee makes a prima facie case, the burden shifts to the employer to
articulate a legitimate and non-discriminatory or non-retaliatory reason for the adverse
employment action. McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802, 93 S. Ct. 1817,
1824,36 L. Ed. 2d 668 (1973); Krouse v. Am. Sterilizer Co., 126 F.3d 494, 501 (3d Cir.
1997). Here, David Wengerd stated he terminated Costenbader because (1) she was lazy
and caused trouble at work, (2) she was a swinger, and such a lifestyle conflicted with his
religious beliefs, and (3) there was not enough work to support her position. These
proffered reasons could be legitimate and non-discriminatory reasons for termination.
The burden then shifts back to Plaintiff to show that the proffered reasons are
pretextual. To do so, the plaintiff must point to either direct or circumstantial evidence from
which a fact-finder could reasonably either: (1) disbelieve the employer's articulated
legitimate reasons, and (2) retaliation was the real reason for the adverse employment
action. Krouse, 126 F.3d at 501. Costenbader points to David Wengerd's own deposition
testimony stating that he never gave her any written or verbal reprimands regarding any
inappropriate behavior on her part. (DW1 Dep., Doc. 44, Ex. C, 104:4-105:7). Any
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complaints that he alleged he received are inadmissible hearsay, and other than his word,
there is no testimonial evidence to support him. There is also a logical gap between David's
insistence that Plaintiff stay home after Bender returned to the office on November 13th and
her termination by proxy (via Perih) on the 17th. Furthermore, there is very little evidence
that the Wengerds were even aware of her alternative lifestyle at the time of her discharge.
All the attached exhibits (Doc. 44, Ex. G) post-date Costenbader's termination and are
unduly prejudicial. Finally, within a week of her termination, Defendant hired a replacement
for Costenbader working at near full-time hours. (Gentile Dep., Doc. 51, Ex. I, 196:15-24;
Costenbader Dep., Doc. 51, Ex. G, 102:15-24). Not only did Defendant replace
Costenbader, he hired her rival's daughter, a rival whom David acknowledged had actively
lobbied for Costenbader's discharge. (DW1 Dep., Doc. 44, Ex. C, 94:4-17). Drawing all
reasonable inferences in favor of Costenbader, ajury could reasonably disbelieve David's
stated reasons for Costenbader's termination.

V. Conclusion
For the above reasons, the Court will deny Defendant's Motion for Summary
Judgment. An appropriate order follows.

Robert D. anam
United States District Judge

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