Belinda Egan v. Freedom Bank

In the
United States Court of Appeals
For the Seventh Circuit
No. 10-1214
B ELINDA E GAN,
Plaintiff-Appellant,
v.
F REEDOM B ANK, et al.,
Defendants-Appellees.
Appeal from the United States District Court
for the Northern District of Illinois, Western Division.
No. 3:09 CV 50013— Philip G. Reinhard, Judge.
A RGUED M AY 28, 2010—D ECIDED O CTOBER 6, 2011
Before M ANION, W ILLIAMS, and H AMILTON, Circuit Judges.
W ILLIAMS, Circuit Judge. Only seven months after
Freedom Bank recruited Belinda Egan to serve as one of its
vice presidents, the bank fired her. She had no performance
issues, no attendance problems, and no complaints against
her. What she did have, though, was dinner shortly after
she began with a member of the bank’s board of directors.
The board member told her the fantasies he had about her,
and she declined his advances. Egan complained to the
2 No. 10-1214
bank’s Human Resources officer that the board member
had sexually harassed her, and the board member re-
signed. Shortly after that, the person named as the bank’s
new president told its then-president that he heard Egan
had done something that she should have been fired for.
And about two months after the new president assumed
office, Egan was fired. A jury might credit the bank’s
stance that the new president eliminated Egan’s position
simply to reduce inefficiencies. Or it might agree with Egan
that the bank terminated her in retaliation for her claim of
sexual harassment. We conclude that the conflicting
inferences that can be drawn from the record require a
resolution by a jury. Therefore, we reverse the entry of
summary judgment against Egan on her retaliation claim.
I. BACKGROUND
As this appeal comes to us from the entry of summary
judgment against her, we recount the narrative that follows
by viewing all facts in the record and drawing all reason-
able inferences in the light most favorable to Egan.
Zerante v. DeLuca, 555 F.3d 582, 584 (7th Cir. 2009).
Greg Dempsey, then the president of Freedom
Bank, contacted Belinda Egan in the spring of 2007 about a
position at the bank. He already knew Egan, as the two
had worked together at a different bank. Egan accepted
Freedom Bank’s offer to become its vice president of
retail banking and began working there on July 17, 2007.
Egan met Don Burton, a member of the bank’s board of
directors, during her first week on the job. Burton came
into the bank when he was onsite for a board meeting,
No. 10-1214 3
and Egan asked his opinion about challenges Freedom
faced in a particular market. They agreed to continue
their conversation a week later over the lunch hour
at Applebee’s. After that meeting, Egan saw Burton several
times over the ensuing months when he would occasion-
ally stop in the bank. They agreed to meet again on Sep-
tember 13, 2007, and Burton asked her, “Do you want to
meet at my place or somewhere else?” Egan named a
restaurant. They met there at about 4:00 p.m., and Burton
gave Egan feedback on a document she had requested
that he review.
Egan saw Burton again when she attended a bank board
meeting on September 18, 2007. Burton called her that
week and said he wanted to meet with her to discuss
her meeting with Larry Henson, the CEO of Freedom
Bank’s parent corporation, and they agreed to meet at
a restaurant in the mid afternoon of September 20, 2007.
That day, Burton and Egan discussed her meeting
with Henson, and Burton told Egan that he had recom-
mended to the board that they consider her to be the
next president of Freedom Bank. Burton also said that
the board of directors had the power to fire the
bank’s senior management team, which caused Egan to
feel uncomfortable. The conversation did not only involve
work matters, however. Burton told Egan that he fanta-
sized about making love to her on a dance floor
and wanted to take her to Las Vegas and other places
around the world. Egan declined his advances, and Burton
replied, “If you change your mind, I’ll be home alone
next Tuesday.” Wanting to leave, Egan secretly told
her husband to telephone her, and, when the call came,
she answered and informed Burton she needed to leave.
4 No. 10-1214
Egan told her friend Sheila Dempsey what had tran-
spired and asked her not to tell her husband Greg Demp-
sey, the president of Freedom Bank at the time. The next
day, Sheila apologized and told Egan that she
had informed her husband what had happened. Egan
and Greg Dempsey then discussed her conversation
with Burton. On September 24, 2007, Egan complained
to the bank’s vice president of Human Resources,
Rick Mineck, about what Burton had said to her at dinner.
Mineck opened an investigation into Egan’s complaint.
Before Mineck could interview Burton, Burton resigned
from the bank’s board of directors. Mineck sent Egan
a letter on October 2, 2007 stating that he had investigated
Egan’s complaint and that action had been taken to
prevent a reoccurrence of a similar incident. The letter
also stated that no adverse action or retaliation would
occur as a result of the complaint and that if she believed
she was the subject of adverse action or retaliation,
she should immediately contact Larry Henson, the CEO
of Freedom Bank’s parent corporation.
Greg Dempsey was transitioning out of his role as
bank president around this time. Dave Barajas, Jr.
was ultimately hired to replace him. Henson told Egan
that she had been a candidate for the president position
but that another person had been chosen, and he said
that if she was willing to commit the time, he was
willing to fund her courses in a graduate school banking
program.
Barajas and Greg Dempsey had various conversations as
Barajas was considered for and prepared to become bank
No. 10-1214 5
president. In a conversation critical to this case, according
to Dempsey, during September or early October of 2007,
Barajas told him that he had heard Egan “had
done something that she should have been fired for.”
Dempsey believed Barajas was referring to Egan’s
report that Burton said inappropriate things to her
over dinner. Barajas denies making the statement to
Dempsey.
Barajas officially began as president of Freedom Bank
in early December of 2007. Egan’s responsibilities initially
increased because Barajas relied on her for day-to-day
operations as he learned the job, but she said he refused
to meet with her about plans for the future. Barajas
did meet with others regarding the future, though, and
he hired four new employees over the next several
months. He hired Richard McCormick in January of 2008
as vice president of private banking, Pam Topper to
serve as vice president of corporate services, Amy
Young to assist McCormick and then later to handle daily
branch management duties, and Lyle Spaulding as a
commercial lender.
On February 22, 2008, Barajas wrote a letter to Egan
advising her that he had decided to eliminate the position
of vice president of retail banking, Egan’s position.
The letter gave no reason for this decision. Barajas filed
suit alleging retaliation, a hostile work environment,
and discrimination on the basis of her sex. The district
court entered summary judgment against Egan, and
she appeals.
6 No. 10-1214
II. ANALYSIS
A. Summary Judgment Rulings
We review the district court’s grant of summary judg-
ment de novo, and we view all facts and draw all reason-
able inferences therefrom in the light most favorable to
Egan, the nonmoving party. See Poer v. Astrue, 606
F.3d 433, 438-39 (7th Cir. 2010). Summary judgment
is only appropriate when the pleadings, discovery materi-
als, disclosures, and affidavits demonstrate that there
is no genuine issue as to any material fact and that
the moving party is entitled to judgment as a matter of
law. Fed. R. Civ. P. 56(a); see also Celotex Corp. v.
Catrett, 477 U.S. 317, 322-23 (1986).
Title VII makes it unlawful for an employer to discrimi-
nate against an employee for opposing a practice that
Title VII forbids. 42 U.S.C. § 2000e-3; Poer, 606 F.3d at
439. A plaintiff may proceed under either the direct
or indirect method to prove her claim of retaliation
in violation of Title VII. Poer, 606 F.3d at 439. To
proceed under the direct method as Egan does here,
a plaintiff must show through either direct or circumstan-
tial evidence that (1) she engaged in statutorily pro-
tected activity; (2) she suffered an adverse action taken
by the employer; and (3) there was a causal connection
between the two. Id. at 439. If the plaintiff’s evidence
of retaliatory animus is contradicted,
[T]he case must be tried unless the defendant
presents unrebutted evidence that it would have
taken the adverse employment action against the
plaintiff anyway, “in which event the defendant’s
No. 10-1214 7
retaliatory motive, even if unchallenged, was not
a but-for cause of the plaintiff’s harm.”
Haywood v. Lucent Techs., Inc., 323 F.3d 524, 531 (7th
Cir. 2003) (quoting Stone v. City of Indianapolis
Pub. Utils. Div., 281 F.3d 640, 642 (7th Cir. 2002)).
The parties agree that Egan’s complaint to her
Human Resources department that Burton had
sexually harassed her constitutes statutorily protected
activity. See 42 U.S.C. § 2000e-3(a). It is also clear
that termination constitutes an adverse action.
Haywood, 323 F.3d at 531. The issue, then, is whether
Egan has introduced sufficient evidence from which a
jury could find that there is a causal connection
between her protected activity and her firing. See
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986)
(“at the summary judgment stage the judge’s function
is not himself to weigh the evidence and determine
the truth of the matter but to determine whether there is
a genuine issue for trial”).
Freedom Bank maintains that Barajas and the
bank simply made a business decision to eliminate
Egan’s position, and that her firing was not motivated
in any way by her harassment complaint. Barajas
testified in his deposition that Egan’s tasks were duplica-
tive of those performed by another employee, and that
for that reason, a business decision was made to
eliminate Egan’s position. Consistent with Barajas’s
position, Henson testified that he and Barajas partici-
pated in discussions evaluating the bank’s entire organiza-
tional structure. Henson stated that the bank was losing
8 No. 10-1214
money, so its leaders were attempting to make business
decisions as to how best to proceed to develop the
bank with a structure that ensured its profitability
going forward. As part of that review, Henson said
the decision was made to eliminate the middle manage-
ment position Egan occupied at the time. Henson
also stated that at least one other position had been
eliminated since the decision was made to eliminate Egan’s
position.
With respect to the new hires, Henson testified that
he had specific discussions with Barajas before Barajas was
hired regarding new people that he might want to hire
and what their roles might be. In particular, Henson
said they discussed McCormick, whom Freedom Bank
had been trying to recruit for a year or two. They also
discussed Pam Topper, who like McCormick worked at
a different bank where Barajas had served as a director,
and they discussed a third person as well. The
bank therefore takes the position that these new hires
were not inconsistent with its decision to terminate
Egan’s employment.
The bank’s explanation is plausible, but on summary
judgment, “the court has one task and one task only:
to decide, based on the evidence of record, whether
there is any material dispute of fact that requires
trial.” Waldridge v. Am. Hoechst Corp., 24 F.3d 918, 920
(7th Cir. 1994). Although a jury might agree with the
bank that it eliminated Egan’s position for efficiency
and operational reasons, there is also sufficient evidence
in the record, viewed in the light most favorable to Egan
No. 10-1214 9
as we must, from which a reasonable jury could
conclude that the bank instead fired Egan because
she complained she had been sexually harassed by one
of the bank’s esteemed board members. Notably,
Greg Dempsey asserts that Barajas told him he heard
Egan “had done something she should have been
fired for.” Although the bank argues that the reference
in the statement is ambiguous, certainly one reasonable
conclusion that can be drawn from the comment is
that Barajas was referencing Egan’s complaint that Burton
had sexually harassed her. Indeed, that was the conclusion
Dempsey drew. That conclusion need not even be the
only reasonable conclusion that could be drawn to
survive summary judgment; even so, there is no
other explanation suggested by the record for what Barajas
could be referencing.
There are other factors a jury could weigh in Egan’s favor
as well. A jury might also consider that Egan’s position
was the only one the bank eliminated in 2008. It could
also look to the fact that although the bank maintained
that financial considerations were one reason for
the decision to eliminate Egan’s position, it nonetheless
hired four other persons in the first few months of
Barajas’s tenure. And Egan had no performance issues.
In short, Egan’s claim that the bank retaliated against
her and eliminated her position because she com-
plained of sexual harassment are “not so incredible or
implausible . . . that a reasonable jury could not find in
[her] favor.” Kodish v. Oakbrook Terrace Fire Prot. Dist.,
604 F.3d 490, 507 (7th Cir. 2010). We therefore reverse the
grant of summary judgment on Egan’s retaliation claim.
10 No. 10-1214
Egan also makes perfunctory arguments in her brief
that her hostile work environment and gender discrimina-
tion claims should proceed to trial. The single
verbal proposition in this case by a member of the board
of directors does not rise to the level of a hostile
work environment, however. See Berry v. Chi. Transit
Auth., 618 F.3d 688, 691-92 (7th Cir. 2010) (comments
must be severe or pervasive to create a hostile work
environment). The bank’s hire of a male as its president
instead of Egan does not create a triable issue that
it discriminated against her on the basis of her gender,
as she does not develop any argument as to why
she was similarly qualified. See Bodenstab v. County of Cook,
569 F.3d 651, 658 (7th Cir. 2009) (issues not developed
in an opening brief are waived). Summary judgment on
the hostile work environment and gender discrimination
claims was proper.
B. Magistrate Judge’s Orders
Egan also wishes to challenge orders entered by
a magistrate judge on November 6, 2009 and January 5,
2010. The latter order directed Egan to pay the defendants
$4,815. The order also stated it would set a time by
which the amount must be paid after the district court
decided the defendants’ pending motion for summary
judgment. Both parties characterize the orders as sanc-
tions orders.
The district court granted the defendants’ motion for
summary judgment on January 11, 2010 and entered
judgment that day. The district court made no mention
No. 10-1214 11
of the magistrate orders, nor had Egan objected to
them. She maintains she did not object because the
district court’s judgment was entered before the fourteen-
day time period to object to the magistrate’s latest
order had run. See Fed. R. Civ. P. 72. To date, no time
has been set by which the attorneys’ fees must be paid,
nor has the district court considered the propriety of the
award.
The defendants maintain we lack jurisdiction to
consider the magistrate’s orders, and they are correct. We
first note that our jurisdiction over the substantive
appeal was clear. See Budinich v. Becton Dickinson
and Co., 486 U.S. 196, 200-01 (1988); Houben v. Telular
Corp., 231 F.3d 1066, 1071 (7th Cir. 2000). With respect
to the magistrate orders, there is an initial question as to
whether there is even a final order, as the last order did
not set a time by which the fees were to be paid and
instead stated that a time would be set at a later date.
See Shapo v. Engle, 463 F.3d 641, 643 (7th Cir. 2006) (describ-
ing test for finality as whether the judge has finished with
the case). More importantly here, the parties had not
consented to proceed before a magistrate judge under
28 U.S.C. § 636(c). In the absence of a consent, a magistrate
judge may only recommend a sanctions disposition
to the district court, and only the district court’s decisions
are reviewable in the appellate court. See Directv,
Inc. v. Barczewski, 604 F.3d 1004, 1011 (7th Cir. 2010);
Alpern v. Lieb, 38 F.3d 933, 936 (7th Cir. 1994); see also
King v. Ionization Intern., Inc., 825 F.2d 1180, 1185 (7th Cir.
1987) (“The only part of the statute that expressly autho-
rizes the magistrate to enter a final judgment appealable
12 No. 10-1214
directly to the court of appeals is 28 U.S.C. § 636(c).”).
We therefore lack jurisdiction over the challenges Egan
would like to make to the magistrate’s orders. On remand,
the district court will have the opportunity to consider
the orders, see Alpern, 38 F.3d at 936, along with the defen-
dants’ arguments that Egan failed to object to the orders
in a timely manner.
III. CONCLUSION
The judgment of the district court is REVERSED and this
case is R EMANDED for further proceedings consistent with
this opinion.
10-6-11