Masso v . City of Manchester, et a l . CV-10-370-JL 3/28/12 UNITED STATES DISTRICT COURT DISTRICT OF NEW HAMPSHIRE

Katherine Ann Masso

v. Civil N o . 11-cv-370-JL Opinion N o .

City of Manchester, Manchester Public Television Service, Jason Cote, and Manchester School District

MEMORANDUM ORDER

In this employment discrimination action, plaintiff

Katherine Masso has sued her former employer, the Manchester

School District; her current employer, Manchester Public

Television Service (“MPTS”); the City of Manchester, which formed

MPTS; and her supervisor at MPTS, Jason Cote. Masso alleges that

MPTS, acting at the City’s direction, hired Cote, rather than

her, as MPTS’s Executive Director based solely upon their

respective genders. She further alleges that although her job is

similar to Cote’s, he is paid more than her, and that she does

not receive overtime pay despite her entitlement to i t . Although

the School District could have prevented these unlawful

employment practices, Masso says, it failed to do s o .

Masso seeks to recover from MPTS, the City, and the School

District for gender discrimination in violation of Title VII of

the Civil Rights Act of 1964, 42 U.S.C. § 2000e-2 et seq., and

its state-law analog,

-A; violation of the federal Equal Pay Act,

(d)(1) (“EPA”), and its

state-law analog,

; and violation of

the Fair Labor Standards Act,

(a)(1) (“FLSA”). 1

This court has subject-matter jurisdiction under

(federal question) and 1367 (supplemental jurisdiction) by

virtue of Masso’s federal statutory claims.

The City and the School District have moved for judgment on

the pleadings, see Fed. R. Civ. P. 12(c), arguing that under the

facts as pleaded, it was MPTS, not them, that took the allegedly

unlawful employment actions, and that they are therefore not

liable under any of the statutes cited. In response, Masso

argues that the City and MPTS together constituted a single

employer under the “integrated-enterprise” test set forth in

Torres-Negrón v . Merck & Co., Inc.,

4 , 41-43 (1st Cir.

2007), and that the School District, while it did not take the

actions of which she complains, can be held liable because it

allowed those actions to take place. After hearing oral

argument, the court grants the motion in part and denies it in

part. In her amended complaint, Masso has alleged sufficient

facts to proceed with her case against the City, but has not

1 Masso has also asserted a separate claim for retaliation under 42 U.S.C. § 2000e-2 against Cote individually. The propriety of that claim, which arises from different actions, is not presently before the court.

2 stated a plausible entitlement to relief against the School

District.

I. Legal Standard

A motion for judgment on the pleadings under Rule 12(c) is

evaluated under essentially the same standard as a Rule 12(b)(6)

motion to dismiss for failure to state a claim, see Simmons v .

Galvin,

4 , 30 (1st Cir. 2009), which requires that the

complaint allege “enough facts to state a claim to relief that is

plausible on its face.” Bell Atl. Corp. v . Twombly,

(2007).

II. School District

Each statute under which Masso asserts claims against the

City and School District prohibits employers from taking certain

actions with respect to their employees, i.e., discriminating

against them in their pay, see

(d)(1);

, or their terms of their employment, see 42

U.S.C. § 2000e-2(a);

-A:7, or failing

to adequately compensate them, see

(a)(1). As

just noted, Masso does not allege that the School District itself

took any of these prohibited actions while she was working for

it. Rather, she alleges that, while the School District had

originally contracted with the City to provide public,

3 educational, and government access television, the School

District later agreed to let the City break that contract in

order to form MPTS--the employer that ultimately took the actions

of which she complains. The School District allowed the City to

break the contract, Masso avers, even though it “knew or should

have known of the terms of employment” on which Masso would be

hired at MPTS, and “knew or should have known that those terms

would be in violation of federal and state laws prohibiting

gender discrimination, equal pay, and overtime compensation.”

Even accepting at face value Masso’s factually unsupported

and conclusory allegation that the School District “knew or

should have known” that MPTS would violate federal and state

employment laws, those laws do not entitle her to relief against

the School District. For Masso to state a claim, she would have

to allege that the School District itself discriminated against

her in her pay or terms of employment or failed to adequately

compensate her. The court has found no authority so much as

suggesting that the statutes under which Masso seeks to recover

might create liability for failing to prevent unlawful employment

actions by unrelated parties, and Masso has cited no authority to

that effect.2 Indeed, the First Circuit has “flatly reject[ed]”

2 Attempting to salvage at least one of her claims against the School District, Masso suggests in a footnote that the School District could be held liable under

- A : 2 , XV(d) for “[a]iding, abetting, inciting, compelling, or

4 the argument that an entity that actively “impacts or interferes

with an individual’s employment opportunities” should be held

liable under Title V I I , Lopez v . Massachusetts,

9 , 88-

89 (1st Cir. 2009), and it is difficult to see how passively

standing by while an unlawful employment action occurs would be

treated differently. The claims against the School District are

accordingly dismissed.

III. City of Manchester

Masso’s claims against the City fare considerably better.

Her theory of relief against the City, as noted, is that it and

MPTS together constituted a single employer, such that liability

for MPTS’s conduct should be imputed to the City.

In interpreting the term “employer” as it appears in federal

employment statutes, courts have developed the “single employer”

doctrine, under which two nominally separate entities “may be so

interrelated that they constitute a single employer subject to

liability.” Torres-Negrón, 488 F.3d at 40-41. Though more

coercing another . . . to commit an unlawful discriminatory practice.” But Masso does not explain, and the court does not see, how the conduct alleged constitutes “aiding, abetting, inciting, compelling, or coercing” MPTS to commit an unlawful discriminatory practice--particularly because knowledge of and failure to prevent another’s misconduct ordinarily does not give rise to liability under New Hampshire law. See, e.g., Clearview Software Int’l, Inc. v . Ware,

(citing Coan v . N.H. Dep’t of Enviro. Servs.,

(2010); Marquay v . Eno,

(1995)).

5 commonly used to determine whether an entity may be held liable

under Title V I I , see

the doctrine has also been applied in

actions under both the FLSA, see Arculeo v . On-Site Sales &

Mktg., LLC,

(2d Cir. 2005), and the EPA (which

is part of the FLSA), see, e.g., Chisholm v . Foothill Capitol

Corp.,

(N.D. Ill. 1998). While the New

Hampshire Supreme Court has not had occasion to address the

applicability of the doctrine, that court frequently looks to the

interpretation given federal employment statutes when

interpreting its own employment laws, see, e.g., Madeja v . MPB

Corp.,

7 1 , 378 (2003), and for purposes of the present

motion, the parties agree that the doctrine applies in

interpreting those laws as well.

The court of appeals “has not yet decided what test is

appropriate to determine whether an employer is liable under the

single employer theory, but it has identified three recognized

methods for determining whether a single employer exists . . . :

the integrated-enterprise test, the corporate law ‘sham’ test,

and the agency test.” Torres-Negrón, 488 F.3d at 42 n.8. The

City’s motion assumes that the integrated-enterprise test

applies, and Masso does not argue for a different test. “The

factors considered in determining whether two or more entities

are a single employer under the integrated-enterprise test are:

(1) common management; (2) interrelation between operations; (3)

6 centralized control over labor relations; and (4) common

ownership.” Id. at 4 2 . “All four factors, however, are not

necessary for single employer status,” and “the test should be

applied flexibly, placing special emphasis on the control of

employment decisions.” Id. Evaluating the amended complaint3 in

light of the four factors set forth in Torres-Negrón, Masso has

alleged enough facts to state a plausible claim that the City and

MPTS were a single employer under the integrated-enterprise test.

The amended complaint alleges that the City controls MPTS’s

funding, providing it with the sums necessary to pay for its

equipment, facilities, salaries, and other operating expenses.

It further alleges that City employees are responsible for MPTS’s

management, and that the City’s Finance Department and Board of

Mayor and Aldermen manage MPTS’s daily financial operations. In

addition, the amended complaint alleges that the City itself

established MPTS’s Board of Directors. Taken together, these

allegations suggest that there is at least some degree of common

management, common ownership, and interrelation between MPTS’s

operations and those of the City. And with respect to the

3 Both parties have submitted materials that are outside the pleadings, and not necessarily cognizable on a Rule 12 motion. Rather than convert the motion to one for summary judgment, see Fed. R. Civ. p . 12(d), the court has elected to exclude those materials from its consideration. The court notes, however, that consideration of these materials would not have changed its ruling.

7 control of employment decisions--the most important factor in the

analysis, see Torres-Negrón, 488 F.3d at 42--the amended

complaint alleges that it was the City itself, through the Board

of Mayor and Aldermen, that decided the positions that Masso and

Cote would hold and the salary and benefits they would receive.

Indeed, it was allegedly a committee of the Board of Mayor and

Aldermen that met with plaintiff to inform her of the terms of

her employment with MPTS.4

The court cautions that this ruling should not be taken to

suggest that Masso can necessarily satisfy the integrated-

enterprise test even if every one of these allegations is true.

The degree to which the City controls MPTS’s funding, management,

and operating expenses, and the nature of its influence over

MPTS’s employment decisions, will ultimately determine whether

the City and MPTS constitute a single employer. The court’s

denial of the City’s motion merely reflects the reality that

4 Counsel for MPTS suggested at oral argument that because MPTS did not yet exist in May 2010, when the City allegedly took the unlawful employment actions, MPTS and the City could not possibly have constituted a single employer at that time. The amended complaint does not allege exactly when MPTS was created, though, and this issue was not briefed (MPTS did not file a memorandum in response to the City’s motion), so the court is hesitant to address it at this time. In any event, as Masso’s counsel noted at oral argument, this point may actually cut in her favor: if MPTS did not exist as a separate entity in May 2010, but decisions regarding employment there were nonetheless being made at that time, then it would certainly seem as though the City exercised a great degree of control over MPTS.

8 “because the ‘integrated enterprise’ test involves a detailed

fact driven analysis,” whether a defendant can be held liable as

an employer often cannot be determined on the basis of the

pleadings alone. Rutter v . Picerne Dev. Corp. of Fla., N o . H-07-

3002,

, at *3 (S.D. Tex. Dec. 1 0 , 2007) (citing

cases).

IV. Conclusion

For the reasons set forth above, the motion for judgment on

the pleadings5 is GRANTED in part and DENIED in part. Masso’s

claims against the Manchester School District are dismissed, and

the School District is terminated as a party to this action.

Masso’s claims against the City of Manchester may proceed.

SO ORDERED.

Josep ___N . Laplante United States District Judge Dated: March 2 8 , 2012

cc: Leslie C . Nixon, Esq. Robert J. Meagher, Esq. Allison C . Ayer, Esq. John C . Kissinger, Esq.

5 Document n o . 1 4 .

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