Taylor v. Cardiology Clinic, Inc.
Taylor v. Cardiology Clinic, Inc.
Opinion of the Court
MEMORANDUM OPINION
This matter is before the Court on Defendants’ motion for summary judgment. The parties have fully briefed the motion, and I have reviewed counsel’s arguments and the relevant filings, including the materials permitted under my Order of July 8, 2016 [ECF No. 72], For the reasons stated herein, I will grant Defendants’ motion.
I. STATEMENT OF FACTS AND PROCEDURAL BACKGROUND
On October 3, 2014, Brandi R. Taylor (“Plaintiff’) filed the present action against Cardiology Clinic, Inc., (“Cardiology Clinic”) and Healthcare Management Services, Inc., (“HMS”) (together, “Defendants”). Under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e, et seq. (“Title VII”), she alleges that Defendants unlawfully fired her for being pregnant. (See Compl. ¶¶ 20-24, Oct. 3, 2014 [ECF No. 1].) Defendants move for summary judgment, arguing that they had too few Title
Defendants were formally-independent' but closely-related entities. Suman Chau-han (“Dolly”) was “the president and owner of [HMS],” “the only officer and sole director of the corporation” as well as the “sole shareholder.” (Dep. of Suman Chauhan 24:02-17, 25:09-14, Jan. 14, 2016 [ECF No. 58-11] (hereinafter “Dolly’s Jan. Dep.”).) Dr. Ajit Chauhan, Dolly’s husband, was the sole shareholder, sole director, and sole officer of Cardiology Clinic (id. at 24:18-23, 25:01-05, 25:15-18), though Dolly drew a paycheck for “super-visfing] and managing] the office” as Cardiology Clinic’s office manager (id. at 24:24-25, 25:19-22).
Defendants’ offices were on the same site in Danville (id. at 21:09-23), and Defendants had a “business relationship” (id. at 9:12-13).
In January 2014, however, HMS dissolved. (Dolly’s Jan. Dep. at 9:23-25, 10:01-02.) Cardiology Clinic absorbed several, but not all,
On the number of Defendants’ employees, Plaintiff testified at her deposition that there were fifteen to sixteen—counting Dolly and Dr. Chauhan—while she was employed. (Dep. of Brandi R. Taylor 58:17-59:04, Feb. 1, 2016 [ECF No. 58-10].) She also testified that Defendants had several employees who do not appear on Defendants’ VEC reports or payroll journals. “[I]n cardiolites,” there was an “Amanda” (“Amanda LNU” [Last Name Unknown]) of whose last name Plaintiff was uncertain.
II. STANDARD OF REVIEW
A “court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. It. Civ. P. 56(a). Insofar as the facts are genuinely disputed, they are “viewed in the light most favorable to the nonmoving party .... ” Ricci v, DeStefano, 557 U.S. 557, 586, 129 S.Ct. 2658, 174 L.Ed.2d 490 (2009) (quoting Scott v. Harris, 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007)). “A genuine dispute exists ‘if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.’ ” Wilkins v. Montgomery, 751 F.3d 214,. 220 (4th Cir. 2014) (quoting Shaw v. Stroud, 13 F.3d 791, 798 (4th Cir. 1994)). To that end, the nonmoving party must have in her favor “specific facts”—“more than conelusory allegations, mere speculation, the building of one inference upon another, or the mere existence of a scintilla of evidence.” Dash v. Mayweather, 731 F.3d 303, 311 (4th Cir. 2013). All in all, summary judgment is appropriate “[w]here the unresolved issues are primarily legal rather than factual.” See Koehn v. Indian Hills Cmty. Coll., 371 F.3d 394, 396 (8th Cir. 2004). A court’s task is simply “to determine whether there are issues to be tried.” 10A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 2712, at 206 (2007).
III. DISCUSSION
“An entity can be held, hable in a Title VII action only if it is an ‘employer’ of the complainant.” Butler v. Drive Auto. Indus. of Am., Inc., 793 F.3d 404, 408 (4th Cir. 2015). This requirement begets the “employee-numerosity requirement,” by which Congress intended “[t]o spare very small businesses from Title VII liability ....” Arbaugh v. Y & H Corp., 546 U.S. 500, 504-05, 126 S.Ct. 1235, 163 L.Ed.2d 1097 (2006). To be a Title VII “employer,” an entity must “ha[ve] fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year.” 42 U.S.C. § 2000e(b) (2016).
At oral argument, Plaintiffs counsel conceded that, in this case, the only year in issue is 2013. Accordingly, the question is whether Defendants had requisite Title VII “employees” in that year to be a Title VII “employer.”
A. Except for Dolly as Cardiology Clinic’s office manager, the Chauhans wdre not Defendants’ “employees.”
I must first determine whether Dolly— the president, owner, and sole shareholder and director of HMS—and Dr. Chauhan— the sole shareholder, officer, and director of Cardiology Clinic—were “employees” of either entity.
“[T]he answer to whether a shareholder-director is an employee or an employer cannot be decided in every case by a shorthand formula or magic phrase.” Echevarria v. Insight Med., P.C., 72 F.Supp.3d 442, 457 n. 10 (S.D.N.Y. 2014) (citation and internal- quotation marks omitted). Rather, “the focus of inquiry should be on ‘the common-law touchstone of control.’ ” Bragg v. Orthopaedic Assocs. of Va., Ltd., No. CIV A 206CV347, 2007 WL 702786, at *3 (E.D.Va. Mar. 2, 2007) (quoting Clacka-mas Gastroenterology Assocs. v. Wells (“Clackamas”), 538 U.S. 440, 449,123 S.Ct. 1673, 155 L.Ed.2d 615 (2003)).
“[A]n employer is the person, or group of persons, who owns and manages the enterprise. The employer can hire and fire employees, can assign tasks to employees and supervise their performance, and can decide how the profits and losses of the business are to be distributed .... ” When deciding whether shareholder-directors were employees, ■ no one factor should be decisive ..., but all aspects of the relationship should be considered.
Bluestein v. Central Wisc. Anesthesiology, S.C., 769 F.3d 944, 952 (7th Cir. 2014)
Here, the evidence is clear that Dr. Chauhan was not Cardiology Clinic’s “employee” as Dolly was not HMS’. Respectively, each had total, unrivaled authority as the sole shareholder, sole director, and sole officer. Nothing seriously suggests that either was an employee of his.or her own company,
That said, Dolly was an “employee” of Cardiology Clinic. The analysis “address[es] not only the extent of an individual’s control, but also ‘the source of an individual’s authority5 to control.” Mariotti v. Mariotti Bldg. Prods., Inc., 714 F.3d 761, 767 (3d Cir. 2013) (quoting Smith v. Castaways Family Diner, 453 F.3d 971, 983 (7th Cir. 2006)).
The analysis proceeds, counting Dolly as an employee only in her role as Cardiology Clinic’s office manager.
B. In 2013, Defendants did not have fifteen or more employees for each working day in each of twenty or more calendar weeks.
“[A]n employer ‘has’ an employee if he maintains an employment relationship with that individual.” Walters v. Metro. Educ. Enters., Inc., 519 U.S. 202, 207, 117 S.Ct. 660, 136 L.Ed.2d 644 (1997). “Control loses some of its significance in the determination whether an individual is an employee in those situations in which compensation is not evident,” Haavistola v. Cmty. Fire Co. of Rising Sun, 6 F.3d 211, 220 (4th Cir. 1993); accordingly, courts use a “test ... generally called the ‘payroll method,’ since the employment relationship is most readily demonstrated by the individual’s appearance on the employer’s payroll,” see Walters, 519 U.S. at 206, 207, 211, 117 S.Ct. 660.
In 2013, Defendants combined for at least fifteen paid persons in the following periods: October 12-25, the first half of October 26—November 8, the second half of November 23—December 6, and December 7-20. (Compare HMS’ 2013-14 Payroll Journals at pgs. 65-67, 68-70, 74-76, 77-79, with Cardiology Clinic’s 2013 Payroll Journals at pgs. 15 (month of October), 18 (month of December)). There is a November gap in Dolly’s pay from Cardiology Clinic, but her significant and ongoing relationship with Defendants reasonably implies that she maintained her employment relationship during that month. Accounting for Dolly’s inclusion in November brings the second half of October 26 - November 8 and the first half of November 23—December 6 into count, as well as November 9-22. (See HMS’ 2013-14 Payroll Journals at pgs. 68-70, 71-73, 74-76.) Assuming without deciding that Defendants maintained those numbers for each working day in these periods,
On brief, Plaintiff argues for ten more weeks.
Neither Defendants’ payroll journals nor their quarterly reports to the VEC list these individuals’ names for these periods, and these sources do not even include Fal-lon, Crane, Scearce, or Amanda LNU (unless she is Donato), The most that could identify an employment relationship between Defendants and Amanda LNU is Plaintiffs assertions of Amanda LNU’s role, working about three days a week, and vague timeframe of employment. (See PL’s Taylor Dep. at 18:13-14, :21-24, 19:04-06. Compare Dolly Decl. ¶ 5 (detailing Easter-ling’s role and her working at Cardiology Clinic as an employee of a third-party contractor), with Taylor Decl. ¶ 4 (asserting, in conclusory fashion, that Easterling
Plaintiff needs all ten of the weeks she asserts beyond the payrolls’ total, but she cannot increase the count. Her evidence does not suffice to show genuine issues whether or when Amanda LNU, Fallon, Crane, or Scearce were Defendants’ “employees.”
IV. CONCLUSION
Plaintiffs evidence fails to show a genuine dispute of fact as to whether the employee-numerosity requirement is satisfied. Because, at material times, Defendants had insufficient Title VII “employees” to be a Title VII “employer,” they cannot be liable to Plaintiff under Title VII. I will grant Defendants’ motion for summary judgment.
The clerk is directed to forward a copy of this Memorandum Opinion and accompanying Order to all counsel of record.
. On Defendants’ motion, the facts are considered in the light most favorable to Plaintiff, and reasonable inferences are drawn in her favor. Ricci v. DeStefano, 557 U.S. 557, 586, 129 S.Ct. 2658, 174 L.Ed.2d 490 (2009).
. Alternatively, Defendants argue that they did not discriminate against Plaintiff. There is no occasion to pursue this inquiry. The employee-numerosity requirement’s failure resolves the action.
. For its lifespan, HMS was located on the site of Cardiology Clinic and leased employees only to Cardiology Clinic. (Dep. of Suman Chauhan 23:03-24:01, Jan. 14, 2016 [ECF No, 65-2],)
. In Virginia, "[e]ach employer ... shall report to the [VEC] for each calendar quarter all the information concerning the number of workers subject to the [Virginia Unemployment Compensation Act] and the total wages payable with respect to employment in all pay periods ending within each such quarter.” 16 Va. Admin. Code § 5-32-20. Certain false statements are punishable as Class 1 misdemeanors. See Va. Code Ann. § 60.2-518 (2016).
. “Paychex Corporation” had a service that handled Defendants’ payroll. (Dolly’s Jan. Dep. at 14:22-23.) "[T]he only information reported to Paychecks was reported by the company” (Dep. of Suman K. "Dolly” Chau-han 79:06-09, Apr. 25, 2016 [ECF No. 58-12] (hereinafter "Dolly’s Apr. Dep.”)), and the Chauhans maintain that "[a]nybody who worked for [Defendants] was on [their] payroll through Paychex Corporation” (Dolly’s Jan. Dep. at 51:06-07; Dolly’s Apr. Dep. at 80:05-20; Dep. of Ajit S. Chauhan 22:10-11, May 20, 2016 [ECF No. 58-9]) and that they paid no employees in cash (Dolly’s Apr. Dep. at 81:14-23; Dep. of Ajit S. Chauhan at 23:14— 24:01, 24:13-17).
. According to Dolly, the factors favoring one’s retention by Cardiology Clinic were time working with Defendants as well as “certification], training] in specific medical pro
, Reflecting this change, its 2014 reports to the VEC average just under thirteen "employees” (as termed by the reports) per month (see Cardiology Clinic's Quarterly Tax Reports at pgs. 13, 15, 17, 19) and its biweekly payroll journals showed a fraction less (see Defs.1 Mot. for Summ. J. ex. D, May 20, 2016 [ECF No. 58-5] (hereinafter "Cardiology Clinic’s 2014 Payroll Journals”) (this average not accounting for adjustments on the exhibit's cover sheet)).
. Dolly acknowledged that Plaintiff “states Amanda LNU may or may not be Amanda Donato.” (Chauhan Decl. ¶ 5, June 27; 2016 [ECF No. 66-1] (hereinafter "Dolly Decl.”).) "The only other Amanda that would appear at [the] medical clinic in 2013 was Ms. Easter-ling,” who "was never an employee of Cardiology Clinic or [HMS] ” but, rather,
an employee of University Nuclear & Diagnostics, ... with which [Defendants] had a contract to provide nuclear testing on patients. Ms. Easterling was a nuclear technician who operated medical testing equipment owned by her employer, University Nuclear & Diagnostics. Neither [HMS] nor Cardiology Clinic compensated Ms. Easter-ling because she was employed and supervised by this third party contractor.
(Id.) Plaintiff responded: "Easterling worked alongside of all of the other HMS/Cardiology Clinic employees as a regular employee while I worked there.” (Taylor Decl. ¶ 4, July 14, 2016 [ECF No. 73].)
.Dolly declared that Crane "completed a working interview with [HMS] on September 24, 2013. [She] was not hired after this interview, which lasted one day and she was never an employee of [HMS] or Cardiology Clinic ....” (Dolly Decl. ¶4.) Plaintiff responded: "HMS/Cardiology Clinic never provided daylong on the job interviews while I worked there. If a name appeared on the schedule, it was because they were an employee.” (Taylor Decl. ¶ 3.)
. Dolly declared that Scearce "was scheduled to interview for a position with [HMS] on September 23, 2013. She did not appear for this interview and was never an employee of [HMS].” (Dolly Decl. ¶ 3. But see Taylor Decl. ¶ 3 (denying such an interview process and affirming, instead, employment).)
. On brief, Plaintiff makes something of "Brearme Blair” appearing on HMS’ quarterly report of June 30, 2013, even though she does not appear in the payroll journals for this time; however, it seems that Blair’s inclusion on that quarterly report owes merely to her final check (for work March 16-29) being paid in April, i.e., in the new quarter. (Compare HMS’ Quarterly Tax Reports at pg. 4 (totaling $123.25 wages paid in the quarter), with HMS’ 2013-14 Payroll Journals at pg. 20 (totaling $123.25 earnings for the pay period).) On brief, Plaintiff does not count, but only notes, a "Penny S” (the last name is illegible) and a marked-out "Betty Ann Garmon” on the schedule for October 7-11, 2013. (Mem. in Opp'n to Mot. for Summ. J. ex. 9, at pg. 2, June 17, 2016 [ECF No. 65-9].) Nor does she count a whited-out entry for September 30— October 4, although she notes it. (Mem. in Opp’n to Mot. for Summ. J. ex. 8, at pg. 2, June 17, 2016 [ECF No. 65-8].)
."Courts consistently have held that the phrase 'current calendar year’ refers to the year in which the alleged discrimination occurred.” Komorowski v. Townline Mini-Mart & Rest., 162 F.3d 962, 965 (7th Cir. 1998) (collecting cases); e.g., Richardson v. K.C. Concepts, LLC, No. CA 6:08-3186-HMH-BHH, 2010 WL 500418, at *9 (D.S.C. Feb. 4, 2010); Spencer v. Momingside Police Dep't,
. For purposes of this motion, the parties treat Cardiology Clinic and HMS as one entity. Cf. Butler, 793 F.3d at 408 & n. 3 (explaining the "joint employer” and "integrated employer” doctrines).
. Title VII defines an "employee” as "an individual employed by an employer.” 42 U.S.C. § 2000e(f). This “is a 'nominal definition’ that is ‘completely circular and explains nothing.' ... [T]he courts have concluded that Congress intended to describe the conventional master-servant relationship as understood in common law agency,” Walls v. Avpro, Inc., No. CIV. JFM-04-3042, 2005 WL 855931, at 1 (D.Md. Apr. 14, 2005) (quoting Clackamas, 538 U.S. at 444, 123 S.Ct. 1673), aff'd, 162 Fed.Appx. 252 (4th Cir. 2006).
.Those factors are (1) "[wjhether the organization can hire or fire the individual or set the rules and regulations of the. individual's work,” (2) "[wjhether and, if so, to what extent the organization supervises the individual's work,” (3) “[wjhether the individual reports to someone higher in the organization,” (4) “[wjhether and, if so, to what extent the individual is able to influence the organization,” (5) “[wjhether the parties intended that the individual be an employee, as expressed in written agreements or contracts,” (6), and “[wjhether the individual shares in the profits, losses, and liabilities of the organization.” Clackamas, 538 U.S. at 449-50, 123 S.Ct. 1673 (quoting EEOC Compliance Manual § 605:0009.10).
.Here, neither tax treatment nor terminology diminish (or even speak to) the central question of control. Cf., e,g., Bluestein, 769 F.3d at 955-56. Nor does Defendants’ corporate form. See Mariotti v. Mariotti Bldg. Prods., Inc., 714 F.3d 761, 767 (3d Cir. 2013) ("Clackamas's application is not limited to professional corporations. [T]he nature of the business entity is simply an attribute of the employment relationship that must be considered in applying the Clackamas test ..½&, Walls, 2005 WL 855931, at *2 n. 1. To recapitulate, " ‘[ejmployers’ are those whose authority and interests are so aligned with the business as to render them the legal personification of the business, i,e., principals rather than agents.” Smith v. Castaways Family Diner, 453 F.3d 971, 978 (7th Cir. 2006). The Record clearly personifies Cardiology Clinic as Dr. Chauhan and HMS as Dolly.
.This consideration seems implicit in the first and fourth Clackamas factors. Mariotti, 714 F.3d at 767, 768; Smith, 453 F.3d at 983.
.Courts have also considered quarterly reports to state or territorial authorities. See, e.g., Escribano-Reyes v. Professional HEPA Certificate Corp., 817 F.3d 380, 384 (1st Cir. 2016); E.E.O.C. v. Pizza & Sub Express, Inc., No. 3:09-CV-85-CDL, 2010 WL 3715751, at *3, *4-5 (M.D.Ga. Sept. 13, 2010); Yost v. Clark Enters. 2000, No. 06-1274-JTM, 2007 WL 163764, at *1 (D.Kan. Jan. 19, 2007); Revels v. Hardwire, LLC, No. CIV.A. RDB 05-3244, 2006 WL 4662503, at *3 (D.Md. June 14, 2006), aff'd, 210 Fed.Appx. 311 (4th Cir. 2006); Owens v. S. Dev. Council, Inc., 59 F.Supp.2d 1210, 1214 & n. 2 (M.D.Ala. 1999), aff'd, 228 F.3d 415 (11th Cir. 2000).
.Clearly, this "does not have to be 'an incredibly complex [or] expensive factual inquiry.' ” Daggitt v. United Food & Commercial Workers Int'l Union Local 304A, 59 F.Supp.2d 980, 982 (D.S.D. 1999) (quoting Walters, 519 U.S. at 210, 117 S.Ct. 660), aff'd, 245 F.3d 981 (8th Cir. 2001); see Cameron v. Mid-Continent Livestock Supplements, Inc., 211 F.Supp.2d 1120, 1125 (E.D.Mo. 2002) (mentioning the method's utility "[f]or counting purposes and to ease the discovery burden”).
. Perhaps these numbers might be whittled down further. The undertaking is unnecessary here.
. This number accounts for Dr. Chauhan’s exclusion.
. Dolly declared that Setiff "terminated her employment with [HMS] on April 26, 2013 to pursue RN nursing school. She started working at [HMS] again on August 5, 2013, when [HMS] rehired her. Neither defendant had an employment relationship between those dates with Ms. Setiff.” (Dolly Deck ¶ 2.)
. The weaknesses in Plaintiff’s evidence are similar to those addressed in Escribano-Reyes v. Professional HEPA Certificate Corp., 817 F.3d 380 (1st Cir. 2016), Babich v. Management & Technical Resources, Inc., No. CIV.A. 06-1502, 2008 WL 356480 (W.D.Pa. Feb. 6, 2008), and Wilson, 249 F.Supp.2d 993. Cf. Revels, 2006 WL 4662503.
.With Setiff's exception, the contended employment relationships seem to depend on merely a hinted suspicion that these individuals had unreported, cash-paid employment. Moreover, the case is especially weak for Crane and Scearce, whose respective single day and no days on schedule establish nothing near the requisite week of working days in an employment relationship.
Reference
- Full Case Name
- Brandi R. TAYLOR v. CARDIOLOGY CLINIC, INC., and Healthcare Management Services, Inc.
- Cited By
- 2 cases
- Status
- Published