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United States District Court, S.D. New York

July 16, 2004.

LEEDS, MORELLI & BROWN, P.C., et al., Defendants.

The opinion of the court was delivered by: ROBERT SWEET, Senior District Judge


Defendants Leeds, Morelli & Brown, P.C. ("LM&B" or "the Firm"), Lenard Leeds ("Leeds"), Steven Morelli ("Morelli"), and Jeffrey K. Brown ("Brown") (collectively, "Defendants") have moved to dismiss the amended complaint of plaintiff Deirdre Kamber Chisari ("Chisari") and for summary judgment, pursuant to Fed.R.Civ.P. 12(b)(6) and 56(c), or, in the alternative, for a change of venue. For the reasons set forth below, Defendants' motion to dismiss and for summary judgment is granted and their motion to change venue is denied as moot.

Prior Proceedings

  Chisari commenced this action against Defendants on November 6, 2002, alleging that Defendants terminated her employment upon learning that she was pregnant and bringing claims pursuant to Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000(e), et seq. ("Title VII") and the New York State Human Rights Law ("NYSHRL"). She filed an amended complaint on February 19, 2003. On January 22, 2004, this Court granted the request of Chisari's attorney to be relieved as counsel and granted Defendants' motion to disqualify Chisari's proposed subsequent attorney of record. The instant motion was filed on August 8, 2003. Following various adjournments, by order entered on March 26, 2004, the return date for Defendants' motion was set for April 28, 2004 and Defendants were directed to file and serve on Chisari a notice pursuant to Local Civil Rule 56.2 of the Local Rules of the United States District Courts for the Southern and Eastern Districts of New York. Chisari submitted no papers in opposition to Defendants' motion and the motion was deemed fully submitted on April 28, 2004.*fn1

  The Facts

  The facts are set forth based upon Defendants' Local Rule 56.1 statement and supporting declarations. In the absence of any opposition by Chisari to Defendants' motion, these facts are deemed admitted by Chisari and are taken as true for the purposes of this motion. See Vermont Teddy Bear Co. v. 1-800 BEARGRAM Co., ___ F.3d ___, No. 03 Civ. 7030, 2004 WL 1472675, at *5 (2d Cir. July 1, 2004); LeSane v. Hall's Sec. Analyst, Inc., 239 F.3d 206, 211 (2d Cir. 2001).*fn2 LM&B is a law firm that primarily represents plaintiffs in employment litigation. The majority of the Firm's clients pursue claims of discrimination on the basis of race, national origin, gender, disability, age, pregnancy and other protected classes.

  In light of the work LM&B performs, Defendants are sensitive to discrimination issues and go out of their way to ensure there is no discrimination in the workplace. Indeed, the Firm's attorneys are aware of the laws prohibiting discrimination and Defendants have discussed these issues with all staff members. The Firm has an equal employment opportunities policy, which was provided to all employees, including Chisari. Defendants have held meetings with all employees, including Chisari, to discuss the Firm's anti-discrimination policies.

  Chisari commenced employment with the Firm on or about September 1998. She was hired by the Firm right out of law school and was admitted to practice law in New York State in December 2000. During the course of Chisari's employ at LM&B, the vast majority of her work and her primary job responsibility was to handle the Firm's representation of a group of approximately 175 Insurance Agents in a confidential alternative dispute resolution process (the "ADR process" or the "ADR project") against one company. In March of 2000, while working on the ADR project, Chisari threatened to leave the Firm. Because Chisari had intimate knowledge of the claims in the ADR process and because of her working relationship with the clients, Defendants believed that it was important to retain her as an employee. Accordingly, Defendants met her demand to increase her salary from $40,000 annually to $70,000, constituting a 75% raise. The parties entered into an employment contract to reflect the raise and other terms of the parties' agreement.

  In addition to the salary increase, the Firm also agreed to allow Chisari to hire an attorney and/or interns to assist her, to receive a new computer, to obtain an additional five days of annual personal leave, and to receive a guaranteed $15,000 raise as of January 1, 2001. In January of 2001, Chisari was granted the $15,000 raise she had been promised and her salary was raised to $85,000, which was the second highest salary of any employee at the Firm. The primary reason the Firm gave Chisari such a large increase in compensation was to maintain her as an employee so that she would continue working on the ADR process.

  Chisari was granted the second highest salary despite the fact that there were other attorneys who were earning less but had similar and/or more experience as a lawyer than Chisari. In January of 2001, at the time Chisari was given a raise to $85,000, she had only been out of law school for two and a half years and she was only admitted to practice in New York for less than two months.

  The employment agreement between Chisari and the Firm was specifically designated an "at will" employment contract. Under the employment agreement, Chisari was to receive only salary. There was no provision in the contract for Chisari to receive any bonus payments.

  By January of 2002, the majority of the insurance agent claims were resolved in the ADR process on which Chisari was working. From January to March 2002, most of the substantive work on the ADR process had been performed and Chisari's responsibilities with respect to the ADR process were primarily administrative in nature. At or about the same time, in early 2002, another major project at the Firm was nearing completion. The amount of work that the Firm had was drastically reduced and was expected to decline further.

  In early 2002, Defendants decided that the Firm had to cut its payroll expenses. At the time, LM&B employed 18 support staff members and 13 lawyers, not including the Firm's partners.

  Defendants decided to eliminate some positions and/or reduce salaries while allowing people to earn bonuses when the Firm earned money on the matters they handled. This decision was based, in part, upon the reduced workload and upon the fact that the Firm primarily represents plaintiffs in contingency fee matters. In or about March or April of 2002, the Firm informed a number of employees that their salaries would be reduced, but that they would be given the opportunity to earn bonuses.

  In late March 2002, the gross annual salary of one female attorney at the Firm was reduced from $95,000 to $60,000. The weekly change in that attorney's net pay (excluding taxes) was a reduction from $1,378 to $789. At the time of her salary reduction, the female attorney was promised the opportunity to earn additional monies in the form of bonuses. The female attorney was not pregnant at the time of her salary reduction, nor has she been at any time that she worked with the Firm. She had five years of experience at the time of the salary reduction.

  In or about early April 2002, the gross annual salary of a male attorney was reduced from $60,000 to $52,000. The weekly change in that attorney's net pay (excluding taxes) was a reduction from $882 to $682. At the time of his salary reduction, the male attorney was promised the opportunity to earn additional monies in the form of bonuses. The male attorney had three years of experience at the time of the salary reduction.

  In or about early April 2002, the gross annual salary of another male attorney was reduced from $80,000 to $50,000. The weekly change in that attorney's net pay (excluding taxes) was a reduction from $1,116 to $754. Prior to his salary reduction, the male attorney was also guaranteed a $20,000 annual bonus. Upon his salary reduction, the guarantee was removed. Including the guaranteed bonus, his annual salary prior to the reduction was $100,000, which was reduced to $50,000. At the time of his salary reduction, the male attorney was promised the opportunity to earn additional monies in the form of bonuses and Defendants agreed to allow him to call himself a partner. The male attorney had twelve years of experience at the time of the salary reduction.

  A third male attorney approached Brown in or about March or April 2002 to remind Brown that when the attorney had commenced employment at the Firm in approximately April 2001, he had been promised a raise after one year of employment. As a result of Defendants' decision to reduce payroll, the male attorney was informed that the Firm could not give him the raise. The male attorney subsequently left the Firm in August 2002. The male attorney was earning an annual salary of $50,000 at the time and had over 15 years of experience.

  A male member of the support staff was laid off on or about February 4, 2002. On or about that same date, a non-pregnant female member of the support staff was also laid off. On or about March 14, 2002, a non-pregnant female paralegal who had worked on the same ADR process with Chisari was laid off. The female paralegal had worked primarily under Chisari's supervision and was laid off because of the fact that the Firm wanted to cut expenses and because the vast majority of the work that need to be done on the ADR process was complete.

  On or about March 22, 2002, a non-pregnant female member of the support staff was laid off, and on April 12, 2002, a nonpregnant female lawyer with over six years of experience was laid off. On or about May 24, 2002, a non-pregnant female paralegal/secretary wad laid off. None of the individuals who were laid off were terminated for cause.

  On March 6, 2002, Brown approached Chisari to inform her that her compensation package would have to be restructured. As Brown initiated discussion with Chisari, she informed him that she was pregnant. He congratulated her but told her that the Firm was experiencing financial difficulties and that it would be unable to continue to pay her salary in a large base and wanted to discuss restructuring her compensation package.

  Although Chisari was informed of the possibility that her compensation package would be restructured on March 6, 2002, when she informed Brown of her pregnancy, the decision to reduce salaries had been made prior to that date. Brown is only one of three equity parties and would not have unilaterally made the decision to restructure Chisari's salary. Given the fact that Chisari was earning the second highest salary at the Firm, it was discussed and agreed upon by all partners that her salary would be one of the salaries to be eliminated or reduced.

  The decision to reduce Chisari's salary was made based on the fact that payroll needed to be cut and that Chisari's salary was raised twice in order to entice her to stay at the Firm and work on the ADR project, a project that was, at the time, nearly complete.

  The female attorney and male attorney with salaries that were comparable to Chisari's also had their salaries reduced.

  In March 2002, rather than eliminate Chisari's position, the Firm made Chisari an offer to remain with LM&B at a reduced salary of $45,000. The Firm also offered her the opportunity to get paid bonuses and the possibility of becoming a partner.

  In a memorandum of March 21, 2002 addressed to "Jeff," Chisari wrote: ". . . I appreciate that you tried to improve the opportunity by offering me a possible bonus arrangement and the remote possibility of partnership. And even after I told you last Wednesday that I would not accept the reduced position, you brought me into your office last Friday to convince me again to stay under the proposed conditions." (Affirmation of Jeffery K. Brown, dated Aug. 8, 2003, Exh. H, at 1.)

  In the same memorandum, Chisari wrote: "You have continuously told me that the firm's decision `isn't personal' and it doesn't reflect on me as an individual, my professional worth or the quality of my work. You advised me on several occasions that `this is an economic decision; you aren't the only one, you just happen to be the first. This will happen to others as well.' I believe you; everything that has happened here has supported your statement. Consistently, for three and a half years, the firm has told me how outstanding my work is and how professional I am. . . . You must understand that your statement that this is just an economic decision does not assuage my frustration with this inequitable decision." (Id. at 3.)

  Subsequent to the March 21, 2002 memorandum, the Firm increased its offer to Chisari to $60,000 in salary for her to stay. Chisari refused and quit her employment. Her last official day at the Firm was April 12, 2002, but she chose not to come to work during the last two weeks of her employment.

  Between January 2002 and August 2003, the Firm hired two additional attorneys. A male attorney was hired on August 12, 2002 at a salary of $45,000, and a female non-admitted law school graduate was hired in September 2002 at a salary of $35,000. Neither of the two attorneys was hired to replace Chisari. They were hired after the Firm was informed that two other attorneys, both experienced lawyers, had decided to quit their employment, giving notice in August 2002.

  Applicable Standards

  A. The Summary Judgment Standard

  If, as here, on a motion to dismiss made pursuant to Rule 12(b)(6) "matters outside the pleading are presented to and not excluded by the court, the motion shall be . . . disposed of as provided for in Rule 56." Fed.R.Civ.P. 12(b).

  Summary judgment is granted only if there is no genuine issue of material fact, and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(c); see Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); SCS Communications, Inc. v. Herrick Co., Inc., 350 F.3d 329, 338 (2d Cir. 2004); see generally 11 James Wm. Moore, et al., Moore's Federal Practice ¶ 56.11 (3d ed. 1997 & Supp. 2004). The court will not try issues of fact on a motion for summary judgment, but, rather, will determine "whether the evidence presents a sufficient disagreement to require submission to a jury or whether it is so one-sided that one party must prevail as a matter of law." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986). "The party seeking summary judgment bears the burden of establishing that no genuine issue of material fact exists and that the undisputed facts establish her right to judgment as a matter of law." Rodriguez v. City of New York, 72 F.3d 1051, 1060-61 (2d Cir. 1995). In determining whether a genuine issue of material fact exists, a court must resolve all ambiguities and draw all reasonable inferences against the moving party. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Gibbs-Alfano v. Burton, 281 F.3d 12, 18 (2d Cir. 2002). Thus, "[s]ummary judgment may be granted if, upon reviewing the evidence in the light most favorable to the nonmovant, the court determines that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law." Richardson v. Selsky, 5 F.3d 616, 621 (2d Cir. 1993).

  A material fact is one that would "affect the outcome of the suit under the governing law," and a dispute about a genuine issue of material fact occurs if the evidence is such that "a reasonable jury could return a verdict for the nonmoving party." Anderson, 477 U.S. at 248; see also R.B. Ventures, Ltd. v. Shane, 112 F.3d 54, 57 (2d Cir. 1997).

  It is the law of this Circuit that "even when a nonmoving party chooses the perilous path of failing to submit a response to a summary judgment motion, the district court may not grant the motion without first examining the moving party's submission to determine if it has met its burden of demonstrating that no material issue of fact remains for trial" and that summary judgment is appropriate as a matter of law. Amaker v. Foley, 274 F.3d 677, 681 (2d Cir. 2001); see also Vermont Teddy Bear, ___ F.3d ___, 2004 WL 1472675, at *2; Holtz v. Rockefeller & Co., Inc., 258 F.3d 62, 74 n. 1 (2d Cir. 2001); Booker v. Fed. Reserve Bank of New York, Nos. 01 Civ. 2290 (DC) & 01 Civ. 2291 (DC), 2003 WL 1213148, at *12 (S.D.N.Y. Mar. 17, 2003); Mattel, Inc. v. Pitt, 229 F. Supp.2d 315, 320 (S.D.N.Y. 2002). Thus, "[w]here, as here, a nonmoving pro se party has failed to submit papers in opposition to a motion for summary judgment, summary judgment may be granted as long as the Court is satisfied that the undisputed facts `show that the moving party is entitled to a judgment as a matter of law,' and plaintiff has received notice that failure to submit evidence in opposition may result in dismissal of his case." Blackett v. Pathmark Stores, Inc., No. 01 Civ. 6913 (DLC), 2002 WL 31385817, at *2 (S.D.N.Y. Oct. 21, 2002) (quoting Champion v. Artuz, 76 F.3d 483, 486 (2d Cir. 1996)).

  B. Title VII and NYSHRL Standard

  Claims of discrimination under Title VII are analyzed under the three-part test announced in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973). First, in order to establish a prima facie case of discrimination, a plaintiff must show (1) that he or she is a member of a protected class, (2) that he or she was qualified for the position in question, (3) that he or she suffered an adverse employment action, and (4) that the adverse employment action occurred under circumstances giving rise to an inference of discrimination. See Texas Dep't of Community Affairs v. Burdine, 450 U.S. 248, 253 (1981); Terry v. Ashcroft, 336 F.3d 128, 138 (2d Cir. 2003); Collins v. New York City Transit Auth., 305 F.3d 113, 118 (2d Cir. 2002); Weinstock v. Columbia Univ., 224 F.3d 33, 42 (2d Cir. 2000). As the Second Circuit Court of Appeals has recently observed,

An "adverse employment action" is one which is "`more disruptive than a mere inconvenience or an alteration of job responsibilities.'" Galabya v. New York City Bd. of Educ., 202 F.3d 636, 640 (2d Cir. 2000) (quoting Crady v. Liberty Nat'l Bank & Trust Co. of Ind., 993 F.2d 132, 136 (7th Cir. 1993)). Examples of materially adverse employment actions include "`termination of employment, a demotion evidenced by a decrease in wage or salary, a less distinguished title, a material loss of benefits, significantly diminished material responsibilities, or other indices . . . unique to a particular situation.'" Id. (quoting Crady, 993 F.2d at 136).
Feingold v. New York, 366 F.3d 138, 152 (2d Cir. 2004).

  Where a plaintiff makes out a prima facie case, the defendant may then rebut the plaintiff's showing by articulating a legitimate, non-discriminatory reason for the employment action in question. See Burdine, 450 U.S. at 254; Weinstock, 224 F.3d at 42. Upon defendant's articulation of such a reason, the presumption of discrimination arising with the establishment of the prima facie case "drops from the picture," and for the case to continue, the plaintiff must present evidence that the proffered reason is "a mere pretext for actual discrimination." Weinstock, 224 F.3d at 42; see also Feingold, 366 F.3d at 152 ("If the defendant has stated a neutral reason for the adverse action, `to defeat summary judgment . . . the plaintiff's admissible evidence must show circumstances that would be sufficient to permit a rational finder of fact to infer that the defendant's employment decision was more likely than not based in whole or in part on discrimination.'") (quoting Stern v. Trustees of Columbia Univ., 131 F.3d 305, 312 (2d Cir. 1997)).

  "[S]ince claims under the NYSHRL are analyzed identically to claims under the ADEA and Title VII, the outcome of an employment discrimination claim made pursuant to the NYSHRL is the same as it is under the ADEA and Title VII" and need not be addressed separately. Smith v. Xerox Corp., 196 F.3d 358, 363 n. 1 (2d Cir. 1999) (citing Leopold v. Baccarat, Inc., 174 F.3d 261, 264 n. 1 (2d Cir. 1999)); see also Mack v. Otis Elevator Co., 326 F.3d 116, 122 n. 2 (2d Cir. 2003) ("`Our consideration of claims brought under the state and city human rights laws parallels the analysis used in Title VII claims.'") (quoting Cruz v. Coach Stores, Inc., 202 F.3d 560, 565 n. 1 (2d Cir. 2000)).

  Discussion Defendants concede, for the purposes of this motion, that Chisari was in a protected class and that she has been subjected to an adverse employment decision,*fn3 and they do not contest her qualification. They claim, however, that Chisari cannot demonstrate an inference of discrimination such as would satisfy her initial burden of establishing a prima facie case.

  Construing the facts set forth above in Chisari's favor, the record nonetheless does not support an inference of discrimination concerning the circumstances surrounding Chisari's departure from the Firm. There is ample evidence on the record that the decision to restructure Chisari's compensation was motivated by financial constraints impacting the Firm as a whole, and that these financial constraints affected a number of employees, many of whom were subjected to similar restructuring of their compensation packages. Moreover, the record demonstrates that Defendants had begun to take steps regarding employee compensation and retention prior to Brown being informed of Chisari's pregnancy, and that the overall reduction in payroll affected Chisari and her similarly situated, non-pregnant colleagues comparably. These circumstances do not support an inference of discrimination; accordingly, Chisari has not established a prima facie case of discrimination. Even if Chisari had satisfied her initial burden of establishing a prima facie case of discrimination, Defendants have articulated non-discriminatory reasons for their decision to restructure her compensation as set forth above, and there is nothing on the record to suggest that Chisari could raise a triable issue of pretext here.


  For the reasons set forth, Defendants' motion to dismiss and for summary judgment is granted and their motion to change venue is denied as moot.

  This action is closed.

  It is so ordered.

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