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FERRARO v. KELLWOOD COMPANY

November 16, 2004.

LAURA FERRARO, Plaintiff,
v.
KELLWOOD COMPANY, Defendant.



The opinion of the court was delivered by: SHIRA SCHEINDLIN, District Judge

OPINION AND ORDER

Laura Ferraro is suing her former employer, Kellwood Company ("Kellwood"), for violations of the New York State Human Rights Law ("NYSHRL"), N.Y. Exec. Law § 296 et seq., and the New York City Human Rights Law ("NYCHRL"), N.Y.C. Admin. Code § 8-101 et seq. Jurisdiction is based on diversity of citizenship pursuant to 28 U.S.C. § 1332. In particular, plaintiff brings the following claims: (1) failure to provide a non-discriminatory environment;*fn1 (2) discriminatory reduction in salary and demotion; and (3) hostile work environment and constructive discharge. The alleged discriminatory conduct resulted from plaintiff's status as a disabled person, or a person perceived as disabled, due to breast cancer. Pursuant to Rule 56 of the Federal Rules of Civil Procedure, defendant now seeks dismissal of the Complaint on summary judgment. For the following reasons, defendant's motion is granted.

  I. FACTS

  A. Plaintiff's Employment History

  Kellwood Company ("Kellwood"), headquartered in St. Louis, Missouri, markets apparel and consumer soft goods. See Kellwood Corporate Profile at http://www.kellwood.com/corporate/profile.asp. Kellwood has numerous divisions throughout several states, Canada and Hong Kong that sell women's and men's sportswear and other soft goods. See Corporate Division/Management and Locations at http://www.kellwood.com/corporate/divIndex.asp. Vintage Blue, one of Kellwood's divisions based in New York City, manufactures and distributes women's sportswear. On April 30, 2001, Ferraro began working as President of Vintage Blue. See Plaintiff's Local Rule 56.1(b) Counter Statement of Material Facts in Opposition to Defendant's Motion for Summary Judgment ("Pl. 56.1") ¶ 9. Ferrraro was hired by Arthur Gordon, Chief Executive Officer of Kellwood's Western Region, for the specific purpose of improving the troubled division. See Defendant Kellwood Company's Local Rule 56.1 Statement of Material Facts in Support of its Motion for Summary Judgment ("Def. 56.1") ¶¶ 1-2. Ferraro reported directly to Gordon until her demotion in May 2003.*fn2 See Pl. 56.1 ¶ 10.

  Ferraro was diagnosed with breast cancer on September 5, 2002, and had a lumpectomy on September 17, 2002. See id. ¶ 22. Ferraro took a short leave of approximately one week for treatment. See Def. 56.1 ¶ 30. Following surgery, Ferraro received radiation treatments but continued to work throughout the treatments. Ferraro's illness did not affect her ability to work or her attendance. See Pl. 56.1 ¶ 22.

  On June 10, 2003, Ferrraro requested a leave of absence. See Request for Leave of Absence, Ex. A to the Affidavit of Laura Ferraro in Opposition to Defendant's Motion for Summary Judgment ("Ferraro Aff."). The reason for the request was: "To recuperate from cancer and stress caused by harassment at work, which is making me ill, comprising my immune system and is interfering with my recovery." Id. Approximately one month later, Sue Hammond, Director of Human Resources, sent Ferraro a letter enclosing a Harassment Complaint Form. See 7/9/03 Letter from Sue Hammond, Ex. G to Reply Memorandum of Law in Support of Defendant's Motion for Summary Judgment ("Def. Reply"). Ferraro was asked to complete the enclosed form, detailing the alleged harassment, so that Kellwood could investigate. See id. Ferraro did not respond to this letter. On January 7, 2004, Ferraro's employment was terminated. See 1/7/04 Letter from Sue Hammond, Ex. O to Appendix to Plaintiff's Memorandum of Law in Opposition to Defendant's Motion for Summary Judgment ("Pl. Opp.").

  B. The Restructuring of Vintage Blue

  Gordon planned to reorganize Vintage Blue before Ferraro began working at Kellwood. See Pl. 56.1 ¶ 17. Pursuant to his plan, and prior to Ferraro's arrival, Gordon eliminated Vintage Blue's dress division, which accounted for $7-$8 million worth of business. See id. ¶ 18. In late 2002, Gordon and Ferraro learned that Vintage Blue would lose approximately $4.5 million of the junior apparel business it had with J.C. Penney, through no fault of Ferraro. See id. ¶ 35. In December 2002/January 2003, Gordon decided to move the remaining $5-$7 million of Vintage Blue's junior apparel business to Kellwood's My Michelle division. See id. ¶ 36.

  Vintage Blue's sales volume did not improve in fiscal year 2002. In fact, in June 2002, Allyson Twomey, one of Ferrraro's subordinates, recalled Gordon calling Ferraro and her entire staff "fucking idiots" and threatened to fire all of them if Vintage Blue's sales numbers did not improve.*fn3 See id. ¶ 24. During the summer of 2002, Ferraro fired two of her subordinates because of poor sales performance. See id. ¶ 27. During the first quarter of fiscal year 2003, Ferraro anticipated $1.7 million in sales but Vintage Blue only brought in $1.1 million in actual sales volume. See Def. 56.1 ¶ 40. During the second quarter of 2003, Ferraro anticipated $1 million in sales but Vintage Blue only brought in $461,000. See id. Gordon held Ferraro partially responsible for these results. See id. Ferraro admits that Vintage Blue's sales numbers were decreasing and that her projections for the third quarter of 2003 were below the threshold for Vintage Blue remaining a free-standing division. See id. ¶ 45. In May 2003, Gordon decided to fold Vintage Blue into ENC, a larger division within Kellwood's Western Region, which was headed by Penny Aschkenasy. See id. ¶ 43. Gordon made this decision because Vintage Blue's sales numbers were not high enough for it to survive as a stand-alone division. See id. ¶ 47. Gordon also became frustrated because Ferraro constantly revised her sales projections downward and her projections were consistently off. See id. ¶¶ 32, 36, 48. By reorganizing Vintage Blue, Kellwood benefitted from economies of scale and was able to cut overhead. See id. ¶ 44.

  After the reorganization, Ferraro reported directly to Aschkenasy instead of Gordon. See id. ¶ 49. Plaintiff ostensibly retained the title of President but could no longer attend "Presidents Meetings."*fn4 See Pl. 56.1 ¶ 58. In addition, in an unprecedented move, Gordon cut Ferraro's base salary from $270,000 to $200,000.*fn5 See id. ¶ 60. Ferraro was admittedly relieved that she no longer had to report directly to Gordon. See id. ¶ 59. C. Plaintiff's Relationship with Gordon

  During the course of her employment, Ferraro had daily telephone contact with Gordon. See id. ¶ 16. In addition, Ferraro had in-person contact with Gordon approximately once a month at the Presidents Meetings. See id. Gordon admittedly uses profanity, including the word "fuck," in the workplace and raises his voice and yells when he gets upset. See Def. 56.1 ¶ 10. In fact, Love testified that Gordon uses the word "fuck" on a normal basis and that Gordon has yelled and cursed at him in the past. See id. ¶ 14. While those who reported to Gordon agree that he can be difficult and that he raises his voice and uses profanity, none found Gordon to be personally abusive.*fn6 See Pl. 56.1 ¶ 12.

  When Ferraro first started working at Kellwood, her relationship with Gordon was positive. See id. ¶ 15. However, Gordon's treatment of Ferraro drastically changed after she returned to work following her surgery. See id. ¶ 23. Gordon first abused Ferraro in front of others during her October 2002 business trip to Kellwood's Los Angeles office. At one meeting during this trip, in front of Love and Twomey, Gordon screamed that Ferraro was a "fucking idiot" who "didn't know how to run a business." See id. ¶¶ 24-26. During this trip, Gordon also told Ferraro to "shut up, you fucking idiot" in front of McCarthy.*fn7 See id. ¶ 31. At other meetings during this trip, Gordon pointedly ignored Ferraro. See id. ¶ 29.

  Gordon's harassment continued unabated. After the October 2002 business trip, Gordon called Ferraro and was verbally abusive on a near daily basis. See id. ¶ 50. For example, in December 2002, on the first and only day Ferraro had taken off from work since her surgery, Gordon called her doctors' offices no less than four times. See id. ¶¶ 44-46. In January 2003, Ferraro was on the phone with Gordon who was screaming so loud that he could be overheard by a visitor in Ferraro's office. See id. ¶ 49. Gordon also became completely unreasonable in his demands with respect to the plans for the 2003 fiscal year. See id. ¶ 39. By April 2003, Gordon had gotten so abusive during his daily calls that Ferraro dreaded speaking to him and would sometimes pretend she was not present when he called.*fn8 See id. ¶ 54. Gordon's abuse did not end when she began reporting to Aschkenasy. Gordon would return calls Ferraro placed to Aschkenasy and continue to abuse her. See id. ¶ 59.

  Nor was Gordon's harassment limited to phone calls. At a meeting with Gordon and Aschkenasy after the decision was made to fold Vintage Blue into EFC, Gordon shouted: "[Aschkenasy] was the only one who wanted you. . . . You're not worth shit." Id. ¶ 65. The next day, if front of approximately thirty people including merchandisers and designers, Gordon screamed that Ferraro "destroyed all of Kellwood West's business." Id. ¶ 66. On May 19, 2003, Ferraro attended a meeting where Gordon announced to the other Presidents that Ferraro "fucked up all the businesses." Id. at ¶ 67. On another occasion, and in the presence of Aschkenasy, Gordon screamed at Ferraro, calling her a "stupid motherfucker." Id. ¶ 70. On May 21, 2003, Ferraro was unable to leave her hotel room, fearing what Gordon might say about her. See id. ¶ 71. Ferraro's therapist, Alan Bernstein, convinced her to go to the Kellwood office, but to avoid Gordon if possible. See id. Ferraro soon afterward reached her breaking point where she was no longer able to go to work because of her fear of Gordon. See id. ¶ 74. On June 2, 2003, while Ferraro was at Bernstein's office, she asked him to call Hammond and tell her that she was going to be out for a while. See id. ¶ 76. Bernstein informed Hammond that Ferraro was "stressed, anxious and very upset ...


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