Lenzi v. Systemax, Inc., 944 F.3d 97

Background

Danielle Markou (née Lenzi) was Vice President of Risk Management at Systemax; she received raises but was paid below market for her role while most male executive peers were paid above market.
From 2011–2013 Markou repeatedly complained internally that she was underpaid relative to male peers and asked for title/pay adjustments.
On March 29, 2013 Markou emailed CEO Richard Leeds complaining about insufficient staffing for product compliance and requesting pay parity; Leeds forwarded the email to General Counsel Eric Lerner and CFO Lawrence Reinhold.
In late May–June 2013 a dispute over an extended travel expense report prompted Reinhold to order an unprecedented internal audit; Markou disclosed her pregnancy to Lerner on May 31 and to Reinhold on June 10.
The audit expanded into alleged performance issues; Markou was placed on leave June 21 and terminated June 26, 2013.
The district court granted summary judgment to defendants dismissing claims under the Pregnancy Discrimination Act (PDA)/Title VII (pay discrimination and retaliation), CPSIA whistleblower protections, and related state-law claims; the Second Circuit vacated in part (PDA, Title VII pay and retaliation) and affirmed in part (CPSIA), and remanded.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Pregnancy discrimination (PDA) — prima facie inference from timing of disclosure to termination	Markou says close temporal proximity between pregnancy disclosure and audit/termination supports an inference of pregnancy discrimination	Systemax argued no inference; adverse actions were non-discriminatory responses to misconduct/investigation	Court: Temporal proximity (pregnancy disclosure → audit/leave → termination within weeks) sufficed at prima facie stage; vacated dismissal of PDA and related state claims
Title VII pay discrimination — whether plaintiff must show EPA-style equal-work comparator	Markou argued Title VII permits pay-discrimination claims without proving equal work; pointed to pay below market vs. male peers plus sexist remarks	Systemax argued Title VII pay claims require EPA’s equal-work showing (i.e., positions substantially equal)	Court: Title VII does not require proving equal work under EPA; a Title VII pay claim can proceed if sex was a motivating factor in compensation decisions; vacated dismissal of Title VII pay claim
Title VII retaliation — protected activity and causal link	Markou contends March 29 email (and prior complaints) constituted protected opposition to gender-based pay practices and that subsequent adverse acts were retaliatory	Systemax said complaints were not gender-specific and thus not protected; adverse actions were warranted and unrelated	Court: Read in context (earlier complaints used term "males"), March 29 email sufficed at prima facie stage; vacated dismissal of retaliation claim
CPSIA whistleblower retaliation — standard and application	Markou contended her emails raised CPSIA-related product-compliance concerns and thus were protected whistleblowing	Systemax said emails complained about staffing/insurance exposure, not a reasonable belief of CPSIA violations; lack of notice to employer that she was reporting potential legal violations	Court: Adopted SOX (18 U.S.C. § 1514A) framework for CPSIA claims (subjective + objective "reasonable belief"); held Markou failed to show she reasonably believed, or that Systemax knew she believed, CPSIA violations occurred — affirmed dismissal of CPSIA claim

Key Cases Cited

McDonnell Douglas Corp. v. Green, 411 U.S. 792 (Sup. Ct. 1973) (framework for burden-shifting in discrimination cases)
Washington County v. Gunther, 452 U.S. 161 (Sup. Ct. 1981) (Title VII pay claim can proceed absent an equal-work comparator)
Tomka v. Seiler Corp., 66 F.3d 1295 (2d Cir. 1995) (discussing relationship between EPA and Title VII pay claims)
Univ. of Tex. Sw. Med. Ctr. v. Nassar, 570 U.S. 338 (Sup. Ct. 2013) (causation principles for Title VII; motivating-factor standard)
Burlington N. & Santa Fe Ry. v. White, 548 U.S. 53 (Sup. Ct. 2006) (definition of adverse action in Title VII retaliation context)
Bechtel v. Admin. Review Bd., U.S. Dep’t of Labor, 710 F.3d 443 (2d Cir. 2013) (elements and burden-shifting for SOX whistleblower claims adopted for CPSIA)
Henry v. Wyeth Pharm., Inc., 616 F.3d 134 (2d Cir. 2010) (factors for assessing probative value of potentially ‘‘stray’’ discriminatory remarks)