Chavez-Acosta v. Southwest Cheese Co.

FILED
United States Court of Appeals
UNITED STATES COURT OF APPEALS Tenth Circuit
TENTH CIRCUIT April 20, 2015
___________________________________
Elisabeth A. Shumaker
Clerk of Court
LORENA CHAVEZ-ACOSTA,
Plaintiff – Appellant,
v. No. 13-2227
(D.C. No. 2:12-CV-00353-JAP-CG)
SOUTHWEST CHEESE COMPANY, (D.N.M.)
LLC,
Defendant – Appellee.
____________________________________
ORDER AND JUDGMENT*
____________________________________
Before KELLY, BALDOCK, and PHILLIPS, Circuit Judges.**
____________________________________
Plaintiff Lorena Chavez-Acosta was an employee of Defendant Southwest Cheese
Company, LLC (“SWC”) from August 2010 until July 2011, when she resigned. Chavez-
Acosta contends that her resignation was compelled by repeated acts of sexual
harassment by fellow employees Chance Senkevich and Cody Stewart that made her
work environment intolerable. Chavez-Acosta eventually sued SWC in New Mexico state
*
This order and judgment is not binding precedent, except under the doctrines of law
of the case, res judicata, and collateral estoppel. It may be cited, however, for its
persuasive value consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
**
After examining the briefs and appellate record, this panel has determined
unanimously to grant the parties’ request for a decision on the briefs without oral
argument. See Fed. R. App. P. 34(a); 10th Cir. R. 34.1(G). The case therefore is ordered
submitted without oral argument.
court, asserting claims of: (1) a hostile work environment due to sexual harassment and
retaliation in violation of Title VII and of the New Mexico Human Rights Act; (2) a
violation of 42 U.S.C. § 1981; (3) breach of contract; (4) negligent hiring and
supervision; and (5) intentional infliction of emotional distress. The district court
dismissed Chavez-Acosta’s § 1981 and retaliation claims. The district court then granted
SWC summary judgment on all claims except Chavez-Acosta’s hostile work environment
claim based on Senkevich’s conduct. The latter claim proceeded to trial, eventually
resulting in a verdict for SWC.
Chavez-Acosta raises five issues on appeal. First, she appeals the district court’s order
striking portions of the affidavits she submitted in response to SWC’s summary judgment
motion. She also appeals the district court’s grant of summary judgment on her claims
regarding: (1) constructive discharge; (2) a hostile work environment due to Stewart’s
sexual harassment; (3) SWC’s negligent hiring and supervision of Stewart; and (4) breach
of contract.1
1
Chavez-Acosta’s filings are imprecise on exactly what issues she is appealing.
Specifically, her two filings before this court are inconsistent on the separation of her
constructive discharge and hostile work environment claims. While her initial statement
of the issues refers only to an appeal of the district court’s grant of summary judgment
regarding constructive discharge, the body of the brief itself appears to contest both
issues. In her reply brief, however, Chavez-Acosta seeks to combine her hostile work
environment and constructive discharge actions into one claim, asserting that she is
“advanc[ing] a compound claim, that is a constructive discharge claim premised on a
hostile work environment.” Chavez-Acosta does this, no doubt, because she failed to
amend her filing before the New Mexico Human Rights Bureau to include a claim of
constructive discharge. As will be detailed below, her failure to do so deprives this court
of jurisdiction to consider her constructive discharge claim. Chavez-Acosta appears to
believe that arguing constructive discharge as a compound claim with hostile work
environment will somehow save this jurisdictional deficiency. It is not so. Whatever
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Exercising jurisdiction under 28 U.S.C. § 1291, we DISMISS Chavez-Acosta’s
constructive discharge claim for lack of jurisdiction and otherwise AFFIRM as to all
issues raised in this appeal.
I. Factual Background2
A. Workplace Incidents
Chavez-Acosta began working for SWC on August 12, 2010, as a Level I employee
(hourly cheese production employee). SWC’s employment handbook, which SWC gave
to Chavez-Acosta, states that all employees are at-will. The handbook also states that the
only way to alter this status is for a change to be agreed to “in writing and signed by both
the employee and the CEO.” Even so, Chavez-Acosta contends that it was well
understood at SWC that all employees begin employment with a 90-day probationary
period, after which employees can only be terminated for good cause.
While she was working at SWC, Chavez-Acosta alleges she was sexually assaulted by
fellow employee Cody Stewart.3 Specifically, Chavez-Acosta asserts that at work one
Chavez-Acosta’s assertions regarding a “compound claim,” we consider her hostile work
environment and constructive discharge claims separately to explain why we lack
jurisdiction to entertain her constructive discharge argument here.
2
As this case is before us on an appeal of the district court’s grant of summary
judgment, we state the facts in the light most favorable to Chavez-Acosta, the non-
moving party. See, e.g., Garrett v. Hewlett-Packard Co., 305 F.3d 1210, 1213 (10th Cir.
2002).
3
As noted above, Chavez-Acosta claims she was also sexually assaulted by fellow
employee Chance Senkevich. Because her claims regarding Senkevich proceeded to trial
and a jury decided that Chavez-Acosta could not prove that Senkevich had sexually
harassed her, the law of the case doctrine prevents Chavez-Acosta from relitigating this
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night in October 2010, Stewart repeatedly exposed his genitals to her. Stewart allegedly
told Chavez-Acosta that he was doing so because he was having problems with his wife
and wanted to get back at her for cheating on him. Chavez-Acosta also asserts that
Stewart told her that if she reported him to Human Resources, she would lose her job
because he was friends with Production Manager Eric Denton. Chavez-Acosta claims that
as a result, she did not report Stewart’s actions out of fear for her job.
Chavez-Acosta contends that Stewart had a habit of exposing his genitals in
workplace environments—principally to female coworkers—and that his predilection
was well known at SWC. Specifically, Chavez-Acosta asserts that Stewart had previously
exposed himself to both Margarita Holguin and Yvonne Macias, fellow SWC employees.
She also contends that Stewart asked fellow employee Misty English “do you want to see
my dick?” while at work. But the record is devoid of evidence suggesting that anyone
reported these instances to SWC management.
Chavez-Acosta also points us to two additional incidents demonstrating Stewart’s
penchant for genital exposure which, while not involving female co-workers, are meant
to highlight that SWC should have been aware of his issue. First, in November 2008
Stewart used a coworker’s phone to take a picture of his exposed genitals at an SWC
going-away party. Although many members of upper management saw this picture,
Stewart was not reprimanded. Second, in September 2012—after Chavez-Acosta had left
issue before us. See Zinna v. Congrove, 755 F.3d 1177, 1182 (10th Cir. 2014) (“Under
the law of the case doctrine, ‘once a court decides an issue, the same issue may not be
relitigated in subsequent proceedings in the same case.’” (quoting Ute Indian Tribe of the
Uintah & Ouray Reservation v. Utah, 114 F.3d 1513, 1520 (10th Cir. 1997))). The facts
detailed here thus concern only Stewart’s conduct.
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SWC—Human Resources reprimanded Stewart for sending a picture of uncovered
genitals to a male coworker.
B. Procedural History
On July 18, 2011, Chavez-Acosta resigned from SWC. Before resigning, she filed a
charge of discrimination with the New Mexico Department of Workforce Solutions:
Human Rights Bureau (“Human Rights Bureau”). In her filing before the Human Rights
Bureau, Chavez-Acosta detailed her alleged harassment based on Senkevich’s and
Stewart’s conduct. She asserted claims for a hostile work environment arising from
sexual harassment, retaliation, and a violation of 42 U.S.C. § 1981. But because she had
not yet resigned, Chavez-Acosta’s filing did not allege constructive discharge. Nor did
Chavez-Acosta ever amend this complaint to include a constructive discharge claim.
After reviewing the facts of Chavez-Acosta’s complaint, the Human Rights Bureau
issued an Order of Non-Determination. Chavez-Acosta appealed this ruling in New
Mexico state court. SWC then removed the case to federal district court and moved to
dismiss Chavez-Acosta’s complaint. In district court, Chavez-Acosta amended her
complaint to include claims for breach of contract, intentional infliction of emotional
distress, and negligent supervision. The district court granted SWC’s motion to dismiss
the § 1981 and retaliation claims, but it allowed the remaining claims to proceed. SWC
later moved for summary judgment on the remaining claims; the district court granted
summary judgment on the claims for breach of contract, intentional infliction of
emotional distress, negligent supervision, and a hostile work environment related to
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Stewart’s conduct. However, the district court denied summary judgment on the claim for
a hostile work environment based on Senkevich’s conduct.
The claim based on Senkevich’s conduct proceeded to trial. The first trial resulted in a
hung jury, but a second trial resulted in a jury verdict for SWC. Following the court’s
entry of judgment on the jury’s verdict, Chavez-Acosta timely appealed from the court’s
grant of summary judgment and from an order striking portions of the affidavits she
provided in response to SWC’s summary judgment motion.
II. Discussion
A. Affidavit Portions
Before we consider Chavez-Acosta’s appeal from the district court’s grant of
summary judgment, we first address her concerns regarding the district court’s decision
to strike portions of the affidavits she submitted before it considered summary judgment.
Chavez-Acosta challenges two of the district court’s determinations: (1) the decision to
strike from her affidavit the statement that “it was well known [at SWC] that Stewart had
a habit of exposing his genitals to female employees,” which the district court struck
because Chavez-Acosta “provide[d] no detail as to how she knew that ‘it was well
known’ at SWC”; and (2) the decision to strike from Yvonne Macias’s affidavit the
statement that Stewart was “untouchable because he was part of the white male power
structure at SWC and was protected,” which the district court similarly struck because
there was no indication that Macias had personal knowledge that Stewart was
“untouchable.” Chavez-Acosta contends that striking the affidavits in this manner was an
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inappropriate evidentiary ruling and that sufficient evidence supported both Macias’s and
her personal knowledge contained in their statements.
The admissibility of an affidavit submitted on summary judgment is an evidentiary
ruling that we review for an abuse of discretion. Sports Racing Servs., Inc. v. Sports Car
Club of Am., Inc., 131 F.3d 874, 894 (10th Cir. 1997) (“We cannot say that the district
court abused its discretion in finding [the] affidavit a sham and excluding it. We therefore
affirm its grant of summary judgment on this count.”). Regarding the trial court’s alleged
error in granting the defendant’s motion to strike the affidavits, Chavez-Acosta’s
argument here is premised on the fact that some courts have held that in this context a
trial court ordinarily should not strike affidavits, but should instead “simply disregard[]
those portions which are not shown to be based upon personal knowledge or otherwise do
not comply with Rule 56(e).” See, e.g., Sholl v. Plattform Adver., Inc., 438 F. Supp. 2d
1303, 1307 (D. Kan. 2006).
We do not believe that the district court abused its discretion in refusing to credit the
affidavit statements at issue here. The record shows that neither Chavez-Acosta nor
Macias had a basis in personal knowledge for the statements made in their affidavits. See
Garrett, 305 F.3d at 1213 (recognizing that information presented in the nonmovant’s
affidavit must be “based on personal knowledge and [must set] forth facts that would be
admissible in evidence” (quoting Murray v. City of Sapulpa, 45 F.3d 1417, 1422 (10th
Cir. 1995))). Chavez-Acosta maintains that she has personal knowledge regarding her
assertion; however, her purported personal knowledge is essentially just a conclusory
statement reiterating that Stewart had exposed himself to both her and Macias. She argues
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that her personal knowledge of these incidents is sufficient to support her assertion that
Stewart’s propensity for genital exposure was well known at SWC. We disagree, and we
therefore affirm the district court on this issue. Because Chavez-Acosta does not appear
to us to provide any reason why the district court’s determination regarding Macias’s
affidavit was incorrect—beyond the conclusory assertion that Macias’s statement was
“based on personal knowledge and admissible in a summary judgment proceeding”—we
also affirm as to this determination.
Concerning the alleged error in granting a motion to strike portions of the affidavits,
we do not believe that the trial court’s decision here amounted to an abuse of discretion.
The trial court was correct to disregard the statements at issue because they were not
based on personal knowledge. Even if—as Chavez-Acosta appears to contend—granting
a motion to strike was an uncommon vehicle through which to disregard these statements,
in substance the trial court’s actions affected the same result: the court correctly
disregarded the statements at issue when ruling on summary judgment. This alleged
“error” in no way prejudiced Chavez-Acosta and does not amount to an abuse of
discretion.
In sum, we do not believe the district court abused its discretion by barring the
statements contained in the affidavits of Chavez-Acosta and Macias for lack of personal
knowledge. We therefore affirm the district court as to its determinations regarding the
statements contained in these affidavits.
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B. Constructive Discharge
Concerning the district court’s summary judgment determinations, we first consider
Chavez-Acosta’s appeal regarding her constructive discharge claim. Before we can reach
the merits of this claim, however, we must address jurisdiction. Under both Title VII and
the New Mexico Human Rights Act, exhaustion of administrative remedies is a
jurisdictional prerequisite to suit. Jones v. Runyon, 91 F.3d 1398, 1399 (10th Cir. 1996)
(Title VII); Luboyeski v. Hill, 872 P.2d 353, 355–56 (N.M. 1994) (Human Rights Act). A
plaintiff must timely file an administrative charge to preserve any claim based on a
discrete discriminatory act. Nat’l R.R. Passenger Corp. v. Morgan, 536 U.S. 101, 113
(2002).
Chavez-Acosta neither filed a claim of constructive discharge with the Human Rights
Bureau nor amended her initial complaint with the Human Rights Bureau to include a
claim of constructive discharge. Nonetheless, she asserts that this failure does not strip us
of jurisdiction. Instead, she characterizes her claim as “a constructive discharge claim
premised on a hostile work environment.” In this refashioning, she bases her claim on a
series of discriminatory events and not any “single discrete act.” Chavez-Acosta believes
this distinction permits us to exercise jurisdiction. In addition, she notes that SWC never
raised the jurisdictional arguments below, and thus she contends that it has waived this
argument.
We find both of Chavez-Acosta’s arguments unavailing. First, as to SWC’s failure to
raise the argument below, this failure does not bar our consideration of our own
jurisdiction. Indeed, the Supreme Court has counseled that “[s]ubject-matter jurisdiction
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can never be waived or forfeited.” Gonzalez v. Thaler, 132 S. Ct. 641, 648 (2012). And
second, Chavez-Acosta’s reformulation of her argument does nothing to rescue her
failure either to lodge a complaint with the Human Rights Bureau alleging constructive
discharge or to amend her initial complaint before the Human Rights Bureau to include a
claim of constructive discharge. We have previously concluded, in circumstances similar
to those presented here, that “a claim of constructive discharge requires filing an
administrative charge.” Chapman v. Carmike Cinemas, 307 F. App’x 164, 174 (10th Cir.
2009) (unpublished). Chavez-Acosta’s failure to file such a charge or to amend her
previously filed complaint to include a constructive discharge claim renders us unable to
reach the merits of her constructive discharge argument. We therefore dismiss her
constructive discharge claim for a lack of jurisdiction.
C. Hostile Work Environment4
Chavez-Acosta next contests the district court’s grant of summary judgment regarding
her claims of a hostile work environment based on Stewart’s conduct. We review the
district court’s grant of summary judgment de novo. Manard v. Fort Howard Co., 47
F.3d 1067, 1067 (10th Cir. 1995). “Summary judgment is appropriate when there is no
genuine dispute over a material fact and the moving party is entitled to judgment as a
matter of law.” Russillo v. Scarborough, 935 F.2d 1167, 1170 (10th Cir. 1991). In order
4
The same legal and evidentiary standards undergird both Title VII and the New
Mexico Human Rights Act. See Rodriguez v. N.M. Dept. of Workforce Solutions, 278
P.3d 1047, 1050 (N.M. Ct. App. 2012) (“Owing to the similarities between the Human
Rights Act and Title VII, our Supreme Court has noted that our analysis of claims under
the Human Rights Act is guided by the federal courts' interpretation of unlawful
discrimination under Title VII.” (citing Garcia-Montoya v. State Treasurer’s Office, 16
P.3d 1084 (N.M. 2001))). Therefore, we will consider these claims together.
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to prevail on a hostile work environment claim, Chavez-Acosta must demonstrate that
she was discriminated against because of her gender and that this discrimination created
an abusive environment that was severe enough to alter the conditions of her
employment. See Morris v. City of Colo. Springs, 666 F.3d 654, 663 (10th Cir. 2012). To
determine whether the harassment was sufficiently severe, we consider “the frequency of
the conduct; its severity; whether it is physically threatening or humiliating, or a mere
offensive utterance; and whether it unreasonably interferes with an employee’s work
performance.” Harsco Corp. v. Renner, 475 F.3d 1179, 1187 (10th Cir. 2007) (citing
Harris v. Forklift Sys., Inc., 510 U.S. 17, 23 (1993)). SWC could be liable for Stewart’s
sexual harassment under two theories: (1) vicarious liability; or (2) negligence. See
Burlington Indus., Inc. v. Ellerth, 524 U.S. 742, 765 (1998) (vicarious liability);
Hirschfeld v. N.M. Corr. Dep’t, 916 F.2d 572, 577 (10th Cir. 1990) (negligence).
Generally, the vicarious liability theory applies only when the harasser is a supervisor,
while the negligence theory applies when the harasser is a co-worker. See Kramer v.
Wasatch Cnty. Sheriff’s Office, 743 F.3d 726, 755 (10th Cir. 2014). As Chavez-Acosta
asserts that SWC could be liable under either theory, we consider both in turn.5
5
Chavez-Acosta actually contends that there are three theories of liability under
which SWC could be responsible for Stewart’s actions: (1) negligence; (2) actual
authority; and (3) apparent authority. As both actual authority and apparent authority are
mere creatures of vicarious liability, we consider them more appropriately here under the
same theory.
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i. Vicarious Liability
Regarding vicarious liability, the Supreme Court has previously held that “an
employer is subject to vicarious liability to a victimized employee for an actionable
hostile environment created by a supervisor with immediate (or successively higher)
authority over the employee.” Burlington Indus., Inc., 524 U.S. at 764–65. Recently, the
Court revised the definition of a supervisor for the purposes of Title VII, holding that:
an employer may be vicariously liable for an employee's unlawful
harassment only when the employer has empowered that employee to take
tangible employment actions against the victim, i.e., to effect a “significant
change in employment status, such as hiring, firing, failing to promote,
reassignment with significantly different responsibilities, or a decision
causing a significant change in benefits.”
Vance v. Ball State Univ., 133 S. Ct. 2434, 2443 (2013) (quoting Burlington Indus., Inc.,
524 U.S. at 761). Because Chavez-Acosta’s case was still open on direct review when
Vance was decided, we must give Vance full retroactive effect. See Harper v. Va. Dep’t
of Taxation, 509 U.S. 86, 97 (1993) (holding that, when the Supreme Court applies a rule
of law to the case before it, “that rule is the controlling interpretation of federal law and
must be given full retroactive effect in all cases still open on direct review and as to all
events, regardless of whether such events predate or postdate [the] announcement of the
rule”). We believe that a New Mexico court would treat Vance the same way when
considering Chavez-Acosta’s claim under the New Mexico Human Rights Act. See
Rodriguez, 278 P.3d at 1050 (“[O]ur Supreme Court has noted that our analysis of claims
under the Human Rights Act is guided by the federal courts’ interpretation of unlawful
discrimination under Title VII.”).
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SWC contends that Stewart was not a supervisor under Vance. At the time of his
alleged conduct, Stewart was an Assistant Team Leader in the Cheese Department. SWC
asserts that this did not give him the authority to cause any “significant change” in
Chavez-Acosta’s employment. Based on Vance, therefore, SWC argues that Stewart was
not a supervisor and so it cannot be held liable for his alleged conduct under a vicarious
liability theory.
Chavez-Acosta denies this assertion. She contends Vance does not rescue SWC
because material issues of fact remain in dispute regarding Stewart’s supervisory status.
Further, she asserts that the district court found that Stewart was a supervisor, and that
SWC waived argument on this point by failing to contest Chavez-Acosta’s additional
material issues of fact.
Chavez-Acosta is correct that, based on the pre-Vance definition of a supervisor for
Title VII purposes, the district court found that Stewart qualified as a supervisor. It also
appears from the record that SWC did not contest this characterization. But, contrary to
Chavez-Acosta’s assertions, there are two reasons why we can consider this argument.
First, it would seem unfair to require SWC to formulate arguments by divining the
outcome of future Supreme Court decisions. And second, we have repeatedly iterated that
“we may affirm on any basis supported by the record, even if it requires ruling on
arguments not reached by the district court or even presented to us on appeal.” E.g.,
Jordan v. U.S. Dep’t of Justice, 668 F.3d 1188, 1200 (10th Cir. 2011).
With those preliminary considerations disposed of, we hold that Stewart was not a
supervisor under Vance. While the district court found that Stewart was a part of the
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“supervisory hierarchy at SWC,” this is not enough. At the time of the contested
incidents, Stewart was an Assistant Team Leader in the Cheese Department. His duties
did not give him the authority to take any “tangible employment actions” against Chavez-
Acosta. Instead, that authority resided with SWC’s Production Managers and Human
Resources Director. Whatever Chavez-Acosta’s assertions about Stewart’s “de facto
supervisory status,” Vance tells us that his position did not amount to that of a
“supervisor” for Title VII purposes. Given Stewart’s status, SWC cannot be held
vicariously liable for his alleged harassment of Chavez-Acosta.
ii. Negligence
To prevail on a negligence theory, Chavez-Acosta must demonstrate that SWC “had
actual or constructive knowledge of the hostile work environment but did not adequately
respond to notice of the harassment.” Adler v. Wal-Mart Stores, Inc., 144 F.3d 664, 673
(10th Cir. 1998) (quoting Harrison v. Eddy Potash, Inc., 112 F.3d 1437, 1444 (10th Cir.
1997), vacated, 524 U.S. 947 (1998)). Actual knowledge can be demonstrated “in most
cases where the plaintiff has reported harassment to management-level employees.” Id. If
a management-level employee was not notified, Chavez-Acosta could demonstrate
constructive knowledge by showing that Stewart was a “‘dangerous employee’ whose
tendencies [SWC] should have known about” based on his conduct towards others.
Kramer, 743 F.3d at 755. To determine whether to consider acts alleged by other
employees as relevant to SWC’s constructive knowledge of Stewart’s harassment of
Chavez-Acosta, “we look to ‘[t]he extent and seriousness of the earlier harassment and
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the similarity and nearness in time to the later harassment . . . .’” Tademy v. Union Pac.
Corp., 614 F.3d 1132, 1147 (10th Cir. 2008) (alterations in original) (quoting Hirase-Doi
v. U.S. W. Commc’ns, Inc., 61 F.3d 777, 783–84 (10th Cir. 1995), abrogated on other
grounds by Burlington Indus., Inc., 524 U.S. 742, and Faragher v. City of Boca Raton,
524 U.S. 775 (1998)).
Chavez-Acosta stresses that she has presented enough evidence to make SWC’s
knowledge a disputed issue of material fact. She asserts SWC knew or should have
known about Stewart’s conduct for three reasons, the first going to actual knowledge and
the second two to constructive knowledge. First, Chavez-Acosta appears to contend that
Stewart’s knowledge of his own conduct should be imputed to SWC since he was a
management-level employee. Second, Chavez-Acosta highlights that management-level
employees knew that Stewart had taken a cell-phone picture of his genitals at a company
party in 2008 and that many management-level employees at the party had even seen the
picture. And finally, Chavez-Acosta claims that at least one other employee complained
to management about Stewart’s conduct. She believes that, when combined, these
incidents sufficiently show that SWC either knew, or should have known, about Stewart’s
conduct.
SWC rebuts these assertions. It contends that Stewart’s knowledge of his own
conduct, as an Assistant Team Leader, cannot possibly be enough to impute actual
knowledge to SWC. Regarding actual knowledge, it also highlights that, prior to her
filing with the Human Rights Bureau, Chavez-Acosta never reported Stewart’s conduct.
Concerning constructive knowledge, SWC asserts that Stewart’s actions at a party nearly
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two years before his alleged harassment of Chavez-Acosta are insufficient to show that
SWC had constructive knowledge of his harassment of Chavez-Acosta. SWC also
contends that—contrary to Chavez-Acosta’s assertion—there was no evidence on the
record that any other employee had complained about Stewart engaging in similar
conduct.
SWC is correct on all counts. First, concerning SWC’s actual knowledge, Chavez-
Acosta has never indicated that she reported Stewart’s conduct to the appropriate
authorities. And to the extent Stewart was a supervisor rather than Chavez-Acosta’s co-
worker, SWC would be liable under the vicarious liability theory discussed above and not
the negligence theory at issue here. See Kramer, 743 F.3d at 755. Chavez-Acosta has
created no dispute of fact regarding whether SWC had actual knowledge of Stewart’s
conduct.
Chavez-Acosta has also failed to create a dispute of fact regarding SWC’s
constructive knowledge. Despite her assertion that Stewart repeatedly exposed himself to
a host of people, we see no evidence in the record that any of these incidents (other than
the incident at the 2008 party) were ever reported to management or taken to the
appropriate authorities. SWC’s constructive knowledge, then, must be imputed from
Stewart’s actions at the 2008 party. While Stewart’s conduct was undoubtedly
inappropriate, Chavez-Acosta asks us to infer SWC’s constructive knowledge regarding
her discrimination based on one dissimilar incident two years before. We cannot say this
incident alone would suffice to give SWC constructive knowledge of Stewart’s later
harassment of Chavez-Acosta.
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We therefore conclude that Chavez-Acosta has not shown that SWC could be liable
for Stewart’s conduct under either a vicarious liability theory or a negligence theory.
D. Negligent Hiring and Supervision
Chavez-Acosta offers negligent supervision as another theory under which SWC
could be liable for Stewart’s conduct. Under New Mexico law, this claim would require
“evidence that the employee was unfit, considering the nature of the employment and the
risk he posed to those with whom he would foreseeably associate, and that the employer
knew or should have known the employee was unfit.” Valdez v. Warner, 742 P.2d 517,
519 (N.M. Ct. App. 1987) (internal citation omitted). To survive summary judgment on a
negligent hiring, retention, or supervision claim in New Mexico, an employee need only
prove that the employer knew or reasonably should have known that an employee might
cause some harm. EEOC v. Univ. of Phoenix, Inc., 505 F. Supp. 2d 1045, 1063 (D.N.M.
2007).
The considerations that enter into this claim, then, are the same as those discussed
above regarding SWC’s actual or constructive knowledge of Stewart’s harassment. And
the evidence, or lack thereof, is the same. Chavez-Acosta contends SWC was negligent
for retaining Stewart, but the only evidence she offers to buttress this claim is SWC’s
knowledge of Stewart’s actions at the party in 2008. Just as it was insufficient to support
her hostile work environment claim, so too is this evidence not enough to overcome
summary judgment on the issue of negligent hiring.
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E. Breach of Contract6
Chavez-Acosta’s final claim is that her constructive discharge from SWC constituted
a breach of contract. Despite the language in SWC’s employee handbook regarding the
at-will nature of the employment, Chavez-Acosta claims there was an implied contract
that, after 90 days, an employee at SWC would be fired for good cause only. She
highlights that the existence of an implied contract is usually a question of fact for a jury,
and she believes that she has presented enough evidence that this question should survive
summary judgment and reach a jury.
SWC counters in two ways. First, it contends that Chavez-Acosta resigned her
position and has failed to create a fact issue on her constructive discharge claim. Second,
SWC argues that Chavez-Acosta was an at-will employee and thus—even if she was
constructively discharged—such discharge could not constitute a breach of contract.
We believe that SWC could succeed under either theory. We need not concern
ourselves with its argument regarding the factual basis underlying Chavez-Acosta’s
constructive discharge argument, however, because this is ultimately irrelevant to our
determination. Even if we were to find that Chavez-Acosta could overcome summary
judgment on this issue, the fact remains that her employment contract, the SWC
6
It may at first seem incongruous that we lack jurisdiction to consider Chavez-
Acosta’s constructive discharge claim, and yet we can consider her arguments regarding
a breach of contract when the “breach” is the same alleged constructive discharge. It
appears, however, that New Mexico would permit this line of argument to proceed in a
breach of contract claim under similar circumstances. See Gormley v. Coca-Cola Enters.,
85 P.3d 252, 256 (N.M. Ct. App. 2003) (entertaining a claim for breach of contract based
on constructive discharge where the plaintiff never filed an administrative complaint).
Therefore, we will also consider this argument.
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handbook, and every written communication on the record between her and SWC
confirms that she was an at-will employee. In fact, SWC’s handbook explicitly states that
the only way for this status to be altered is through an agreement “in writing and signed
by both the employee and the CEO.”
Chavez-Acosta does not claim that a written agreement modifying the terms of her
employment and conforming to the SWC handbook’s requirements exists. Instead, she
asserts that SWC’s words and actions created an implied contract that she would be
dismissed only for good cause. She correctly notes that, under New Mexico law, the
existence of an implied contract is a question of fact, and thus summary judgment is
appropriate only if the evidence is insufficient to create a genuine issue of material fact
regarding whether an implied contract was established. See, e.g., Sullivan v. Am. Online,
Inc., 219 F. App’x 720, 721–22 (10th Cir. 2007) (unpublished) (citing Fed. R. Civ. P.
56(c) and Shull v. N.M. Potash Corp., 802 P.2d 641 (N.M. 1990)).
Even assuming that the words and actions of her supervisors informed Chavez-Acosta
that her employment status had been modified, this would still be insufficient to
overcome summary judgment. In New Mexico, “an implied contract is created only
where an employer creates a reasonable expectation” of continued employment.
Hartbarger v. Frank Paxton Co., 857 P.2d 776, 783 (N.M. 1993). We have previously
found under New Mexico law that “repeated unequivocal written declarations of [an
individual’s] at-will status,” particularly when these declarations include one that
“explicitly preclude[s] oral modifications,” are more than enough to make unreasonable a
plaintiff’s belief that her supervisor’s statements and actions modified the at-will nature
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of her contract. Sullivan, 219 F. App’x at 722. That is precisely the situation here. Given
the repeated written acknowledgments of her at-will status and the company policy
prohibiting oral modification of that status, we find unreasonable any belief Chavez-
Acosta may have harbored that her status as an at-will employee had morphed into
something different.
We therefore affirm the district court’s grant of summary judgment as to Chavez-
Acosta’s breach of contract claims.
III. Conclusion
For the reasons stated above, we DISMISS Chavez-Acosta’s constructive discharge
claim for lack of jurisdiction and AFFIRM the district court as to all other issues raised in
this appeal.
ENTERED FOR THE COURT,
Gregory A. Phillips
Circuit Judge
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