Margaret Doe, Respondent, v Bloomberg L.P. et al., Defendants, and Michael Bloomberg, Appellant.
Appellate Division, First Department, New York
September 24, 2019
2019 NY Slip Op 06728 | 178 AD3d 44
Kern, J.
Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. As corrected through Wednesday, December 11, 2019.
APPEARANCES OF COUNSEL
Proskauer Rose LLP, New York City (Elise M. Bloom and Rachel S. Philion of counsel), for appellant.
The Clancy Law Firm, P.C., New York City (Niall MacGiollabhui of counsel), for respondent.
Kern, J.
On this appeal, we are asked to determine when an individual owner or officer of a corporate employer may be held strictly liable as an employer under the New York City Human Rights Law (City HRL) (
The allegations in the complaint are as follows. In September 2012, plaintiff began working in the marketing department at defendant Bloomberg L.P. as a temporary employee selling subscription services to various newsletters. At that time, she was a 22-year-old recent college graduate and had never before held a professional job. Defendant Nicholas Ferris was the Global Business Director of the Bloomberg Brief Newsletter Division and was plaintiff‘s direct supervisor.
Mr. Ferris allegedly began making unwanted advances toward plaintiff a few weeks into her employment at Bloomberg L.P. In or around January 2013, Mr. Ferris inappropriately touched plaintiff during a Bloomberg L.P. radio event. Mr. Ferris continued to regularly send plaintiff inappropriate and offensive emails and “Instant Bloomberg” (IB) messages through
Plaintiff alleges that she did not report Mr. Ferris‘s conduct to Bloomberg L.P.‘s Human Resources Department because she thought the complaint would be ignored or trivialized and would subject her to retaliation. Although plaintiff requested that the HR Department move her desk away from Mr. Ferris‘s desk, she did not state the basis for her request.
Plaintiff alleges that by October 2015, her mental and physical health had deteriorated and she was placed on indefinite medical leave for major depressive disorder and anxiety disorder. In or around December 2015, Bloomberg L.P. terminated Mr. Ferris.
With respect to Mr. Bloomberg, the allegations in the complaint are as follows. Following Mr. Bloomberg‘s example and leadership, Bloomberg L.P. bred a hostile work environment that led to the type of discrimination plaintiff experienced. Mr. Bloomberg was sued in a class action brought by female employees who alleged sexual harassment and creation of a hostile work environment while he was CEO of Bloomberg L.P. Mr. Bloomberg was also accused of condoning systemic top-down discrimination against female employees in a sexual harassment suit brought by the US Equal Employment Opportunity Commission on behalf of 58 female employees, not including the plaintiff. The complaint also cites various magazine articles and statements by public figures describing unsavory conduct and comments made by Mr. Bloomberg, directed at or regarding women other than plaintiff.
Plaintiff commenced this action against Bloomberg L.P., Mr. Bloomberg and Mr. Ferris. In a decision dated December 5, 2017, the motion court granted a motion by Mr. Bloomberg to dismiss the complaint against him in its entirety. However, upon reargument by the plaintiff, the motion court held that
We now reverse and find that the complaint should be dismissed as against Mr. Bloomberg in its entirety. On a motion to dismiss pursuant to
The City HRL imposes strict liability on an “employer” for the discriminatory acts of the employer‘s managers and supervisors (see
The Court of Appeals has held that
Based on a review of the cases that have addressed the issue, we find that in order to hold an individual owner or officer of a corporate employer, in addition to the separately charged corporate employer, strictly liable under
This Court has twice explicitly addressed the issue of when an individual may be held strictly liable, in addition to the corporate employer, under
All of the federal cases cited by the parties which have addressed the specific issue before us now have also held that an individual will only be held strictly liable under
We note that the legislative history of
Moreover, interpreting
Based on the foregoing, we find that plaintiff‘s City HRL claims must be dismissed as against Mr. Bloomberg because plaintiff has failed to sufficiently allege that Mr. Bloomberg is her employer for purposes of the City HRL. She has failed to allege that Mr. Bloomberg encouraged, condoned or approved the specific discriminatory conduct allegedly committed by Mr. Ferris.
Plaintiff alleges that Mr. Bloomberg has been sued for his own discriminatory conduct against others, that he has displayed discriminatory conduct toward other women, that he has made discriminatory remarks about other women and that he has created a culture of discrimination and sexual harassment at Bloomberg L.P. However, such allegations, even if true, fail to support a finding that Mr. Bloomberg was plaintiff‘s employer under the City HRL because they fail to connect Mr. Bloomberg in any way to the specific discriminatory conduct allegedly committed by Mr. Ferris. Plaintiff fails to allege any
Plaintiff‘s assertion that the mere allegation that Mr. Bloomberg created a culture of discrimination and sexual harassment at Bloomberg L.P. is sufficient to sustain a claim against him as an employer under
Plaintiff‘s reliance on Irizarry v Catsimatidis (722 F3d 99 [2d Cir 2013]) is similarly misplaced as that case is distinguishable. In Irizarry, the Second Circuit held that defendant John Catsimatidis, the chairman, president and CEO of Gristede‘s Foods, could be held personally liable for violations of the Fair Labor Standards Act‘s (FLSA) overtime provisions, without regard to his personal culpability in the FLSA violations. However, the reasoning behind such holding is inapplicable here because the FLSA is an entirely different statute than the City HRL. The FLSA establishes minimum wage,
Accordingly, the order of the Supreme Court, Bronx County (Fernando Tapia, J.), entered September 10, 2018, which, upon reargument, denied defendant Michael Bloomberg‘s motion to dismiss the first, second and third causes of action as against him, should be reversed, on the law, without costs, and the motion granted. The Clerk is directed to enter judgment dismissing the complaint as against Michael Bloomberg.
Margaret Doe, Respondent, v Bloomberg L.P. et al., Defendants, and Michael Bloomberg, Appellant.
Appellate Division, First Department, New York
September 24, 2019
2019 NY Slip Op 06728 | 178 AD3d 44
Manzanet-Daniels, J. (dissenting)
Manzanet-Daniels, J. (dissenting). The New York City Human Rights Law (City HRL) is broader than its state counterpart and is to be construed liberally, as the statute itself dictates and as our highest court has decreed (see
As noted by Justice Acosta, writing for the majority in Williams v New York City Hous. Auth. (61 AD3d 62 [1st Dept 2009], lv denied 13 NY3d 702 [2009]), the City HRL expressly “requires an independent liberal construction analysis in all circumstances, even where state and federal civil rights laws have comparable language” (id. at 66). Such independent analysis must “be targeted to understanding and fulfilling what the statute characterizes as the City HRL‘s ‘uniquely broad and remedial’ purposes” (61 AD3d at 66; see also Bennett v Health Mgt. Sys., Inc., 92 AD3d 29, 34-35 [1st Dept 2011], lv denied 18 NY3d 811 [2012]). The Restoration Act amended the City HRL
In Patrowich v Chemical Bank (63 NY2d 541 [1984]), the Court of Appeals held that an individual qualifies as an “employer” under the New York State Human Rights Law (State HRL) when shown to have an ownership interest in the relevant organization or the power to do more than carry out personnel decisions made by others (id. at 542). Bloomberg, the founder, namesake, and majority owner of Bloomberg L.P., clearly qualifies as an (1) individual with an ownership interest; as well as (2) someone with the power to do more than carry out the personnel decisions of others, and the majority does not contend otherwise. This should end the inquiry, particularly in light of the current pre-discovery posture and our mandate to give the City HRL “an independent liberal construction analysis in all circumstances” (Williams, 61 AD3d at 66). As noted in Williams, “the text and legislative history represent a desire that the City HRL meld the broadest vision of social justice with the strongest law enforcement deterrent” (61 AD3d at 68 [internal quotation marks omitted]).
Patrowich and its progeny enunciate a two-prong disjunctive standard for determining who constitutes an “employer” under the State Human Rights Law and other statutes. Once someone is determined to be an “employer,” a court must then turn to the question of liability under the relevant statute, i.e., whether an employer has “encouraged, condoned or approved” the underlying discriminatory conduct so as to be liable under the State HRL; or whether the employee in question (here, Ferris) has “exercised managerial or supervisory control” so as to render Bloomberg strictly liable under the City HRL. The majority collapses these two distinct requirements, in effect holding that only someone who “encourages, condones or approves” is an “employer.” This error—conflating the definition of “employer” with the bases for liability—infects the majority opinion. The majority would graft the state standard onto the City HRL, subverting the purpose underlying the more liberal statutory scheme of the City HRL. Indeed, a standard requiring “encouragement, condonation or approval” is antithetical to the very concept of vicarious liability.
“For the same reason, we may not apply cases under the State Human Rights Law imposing liability only where the employer encourages, condones or approves the unlawful discriminatory acts . . . . By the plain language of NYCHRL § 8-107 (13) (b), these are not factors to be considered so long as the offending employee [in this case, Ferris] exercised managerial or supervisory control” (id. at 481).
In arriving at its reading of “employer,” the majority cites Boyce v Gumley-Haft, Inc. (82 AD3d 491, 492 [1st Dept 2011]), and McRedmond v Sutton Place Rest. & Bar, Inc. (95 AD3d 671 [1st Dept 2012]). In McRedmond, we found certain individual defendants to be liable under the State HRL. We thus found that those same individuals, a fortiori, were liable under the City HRL—hardly a surprising conclusion given that the City HRL is indisputably broader than its state counterpart.
In Boyce, a memorandum opinion from which it is difficult to divine much in the way of factual background or reasoning, we found that the individual defendant 50% owner of a limited liability company could be liable under the City HRL where the proof showed that he “encouraged, condoned or approved” of the underlying discriminatory conduct, citing
To the extent Boyce may be construed along the lines the majority suggests, it is at odds with the definition of “employer” articulated in Patrowich, at odds with the overarching statutory purpose, as articulated in Williams and Bennett, and at odds with the express test of
Neither case is authority for grafting the state standard onto the City HRL, when it is our statutory mandate to construe the City HRL as broadly as possible consistent with its liberal aims. It should be noted that the legislature has recently amended the State HRL to further expand its reach and the grievances it is intended to remedy.
Federal district courts interpreting the City HRL have arrived at differing conclusions as to the appropriate standard for imposing individual liability on an owner/CEO such as Bloomberg. While some would require “some minimal culpability” on the part of individual owners, consistent with principles of corporate law (see Marchuk v Faruqi & Faruqi, LLP, 100 F Supp 3d 302, 308-309 [SD NY 2015]), many hold, consistent with the plain text of the statute, that a plaintiff seeking to impose liability on an individual “employer” need only show that the individual has an ownership interest or power to carry out personnel decisions; it need not be shown that such individual employer participated or was aware of the discriminatory conduct (see Makinen v City of New York, 167 F Supp 3d 472, 487-488 [SD NY 2016] [“immaterial” that there was no evidence that the defendant commissioner participated directly in the discrimination since “(h)e could be held liable solely on the basis that he had the power to do more than carry out the personnel decisions of others” (internal quotation marks omitted)], affd in part and revd in part on other grounds 722 Fed Appx 50 [2018];1 Equal Empl. Opportunity Commn. v Suffolk Laundry Servs., Inc., 48 F Supp 3d 497 [ED NY 2014] [individual co-owner defendants liable under State HRL since they had authority to do more than carry out the personnel decisions made by others]).
The allegations in the complaint are plainly sufficient to state a cause of action at this pre-discovery stage, where we are obliged to accept the facts alleged in the complaint as true and to accord the plaintiff the benefit of every possible favorable
Even under the majority‘s heightened culpability standard, the allegations are sufficient. Plaintiff alleges that Bloomberg created, encouraged or condoned a culture of sexual harassment at Bloomberg L.P. Plaintiff alleges, inter alia, that Bloomberg had an internal messaging system, Instant Bloomberg (IB), that served as “a pseudo dating site.” Plaintiff alleges that Bloomberg had a “selective practice” of reviewing IB for inappropriate content. Defendant Ferris is alleged to have sent plaintiff offensive and misogynistic emails on work email over a three-year period. Plaintiff also alleges that she communicated with a coworker over IB about Ferris‘s inappropriate conduct.
Plaintiff alleges that female employees were encouraged to dress provocatively and that employees regularly commented on female employees’ appearances using a rating system. Plaintiff alleges that Bloomberg did not provide adequate sexual harassment training and that employees were afforded no effective means of complaining about and/or reporting harassment. Indeed, plaintiff alleges that her request for a change of seating assignment so that she did not have to work in proximity to defendant Ferris, her alleged rapist, went unheeded.2 Plaintiff also alleges that she complained about Ferris‘s alleged harassment to a social worker in Bloomberg‘s Employee Assistance Program (EAP), who recommended that she be transferred, but that EAP did not formally demand that Ferris‘s behavior be investigated and that the transfer never occurred.
Kahn and Moulton, JJ., concur with Kern, J.; Renwick, J.P., and Manzanet-Daniels, J., dissent in a separate opinion by Manzanet-Daniels, J.
Order, Supreme Court, Bronx County, entered September 10, 2018, reversed, on the law, without costs, and the motion granted. The Clerk is directed to enter judgment dismissing the complaint as against Michael Bloomberg.