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Krasner v. HSH Nordbank AG

January 8, 2010


The opinion of the court was delivered by: Gerard E. Lynch, Circuit Judge*fn1


Plaintiff David Krasner brings this action against his former employer, HSH Nordbank AG ("HSH"), and his supervisor while employed there, Roland Kiser, alleging sexual discrimination and retaliation in violation of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq., the New York State Human Rights Law ("NYSHRL"), N.Y. Exec. Law § 290 et seq., and the New York City Human Rights Law ("NYCHRL"), N.Y. City Admin. Code § 8-101 et seq.*fn2 Plaintiff further brings a number of state law claims against HSH contending first, that it breached an implied employment contract by discharging him, and second, that it impermissibly withheld his end-of-year bonus, giving rise to claims for breach of contract, breach of implied covenant of good faith and fair dealing, unjust enrichment, quantum meruit and violation of the New York Labor Law. Defendants move to dismiss all claims pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. For the reasons that follow, defendants' motions will be granted.


Defendant HSH is an international commercial bank, headquartered in Germany, and has offices worldwide, including a branch in New York City. (Compl. ¶ 6.)*fn3 HSH's New York branch employs approximately 200 people and, since at least October 2006, has been led by defendant Kiser, the branch's General Manager and Chief Operating Officer. (Id. ¶¶ 6-7.) Plaintiff Krasner joined HSH's New York office in October 2006 as Vice President and Head of Corporate Services. (Id. ¶ 11.)

There, Krasner alleges, he encountered an atmosphere infected with overt sexism, where career "advancement based on sexual favoritism" was accepted (id. ¶ 117), and where male supervisors promoted a sexist and demeaning image of women in the workplace in which women's advancement was governed by a "casting couch" (e.g., id. ¶¶ 96, 109). The primary offender in this narrative is Kiser, who is alleged to have "promote[ed] stereotypical, offensive, and degrading understandings of women in the workplace." (Id. ¶ 110.) For instance, in an email from Kiser to Krasner and a female co-worker named Leslie Colamaria, Kiser noted that "chicks have it so easy" because Colamaria received a number of thank you emails for doing a job that was, by implication, less worthy than a different job performed by Krasner for which he received no thank you notes. (Id.) Kiser also regularly referred to two female staff members as "chicky," and did so on a number of instances within Krasner's earshot. (Id. ¶ 112-13.) Krasner found these various references offensive, as did one of the two staffers. (Id. ¶¶ 111-13.) Kiser also pressured male subordinates, such as Krasner, to go to strip clubs with him when on business trips abroad. (Id. ¶ 114.) On one occasion, Krasner was coerced into entering a German strip club with Kiser, and witnessed Kiser engaging in sexual acts with the strippers but successfully resisted Kiser's urging that he do the same. (Id. ¶¶ 114-15.) During this experience, Krasner was "extremely offended and [was made] extremely uncomfortable by Mr. Kiser's sexist, demeaning, and coercive behavior." (Id. ¶ 116.)

Krasner's complaint does not rest on these instances alone, however, but rather their effect on the work environment when viewed in conjunction with the "culture of widespread sexual favoritism" he perceived to exist at HSH, stemming from several male managers' "open, public intimate relationships with [female] subordinates whom they later favored in the workplace." (Id. ¶ 84.) Krasner points first to an alleged relationship between Klaus Bernhard, the front office general manager, and administrative assistant Monica Yuknek who, Krasner notes, acted affectionately towards one another at company events. (Id. ¶ 85.) Further, Krasner alleges, on information and belief, that Yuknek received favorable treatment in the form of enhanced job protection as a result of her relationship with Bernhard. (Id. ¶ 86.) Krasner also points to an alleged relationship between Peter Burke, a senior vice president in the finance department, and Payal Daswani, a junior administrative employee in the human resources department. Daswani is not alleged to have received any tangible job benefits as result of this relationship, though Krasner recounts one incident in which, on information and belief, Burke's wife found Daswani's sweater in his briefcase, and Burke in turn forced another subordinate female worker to cover up for his and Daswani's affair by calling his wife. (Id. ¶¶ 91-93.) This other female subordinate later emailed Krasner complaining that the office was like a "bordello." (Id. ¶ 95.)*fn4

As regards office relationships too, the primary offender in Krasner's estimation is Kiser, and what takes center stage in the complaint are allegations of a relationship between Kiser and a woman named Melissa Campfield -- who worked in Krasner's department and was the most junior member of the team he supervised (id. ¶ 25) -- and the resulting impact on Krasner's career of his expressions of disapproval. Kiser, it is alleged, "advance[ed] and promot[ed]" Campfield's career "at the expense of the career advancement and reputations of other far more senior and qualified employees," Krasner included. (Id. ¶ 17.)

In June 2007, Krasner became aware of the possibility of "an intimate and possibly sexual personal relationship" between Kiser and Campfield. (Id. ¶ 19.) Krasner strongly disapproved of this relationship, and repeatedly attempted to dissuade Kiser from pursuing it, explaining to him in private conversations that the relationship "could have a detrimental effect on the Department and, as a fiduciary, violated his duty of loyalty to the institution and presented a conflict of interest." (Id. ¶ 20.) Nevertheless, throughout the summer, in the face of Krasner's protestations, Kiser continued the relationship and, according to Krasner, engaged in "unwarranted preferential treatment" (id. ¶ 26) of Campfield, whom Krasner viewed as a "consistent underperformer" (id. ¶ 25).

For example, Kiser arranged for Campfield to attend a business trip to Germany -- an unprecedented junket for someone in such a junior position -- at the same time Kiser himself was there. (Id. ¶¶ 27-29.) Not surprisingly, the two spent time privately together while abroad. (Id. ¶ 29.) Additionally, Kiser facilitated Campfield's insubordination to plaintiff: in the face of Krasner's directive to his team prohibiting text messages on company blackberries Kiser and Campfield exchanged over 500 text messages in July alone. (Id. ¶¶ 21-24.) Campfield was given a separate office and a laptop computer, while similar requests by another (unnamed) female employee with more experience than Campfield were denied. (Id. ¶¶ 97-99.)*fn5 The reasons for the disparity did not escape this woman, who wrote, in an email to a former employee: "I guess if I want to sit in an office and have a laptop, I better start handing out some blow jobs." (Id. ¶ 97.)

Kiser also gave Campfield assignments directly. For example, although Colamaria, the Director of Branch Marketing, was normally responsible for coordinating marketing-related meetings with Krasner, on one occasion, Kiser asked Campfield to coordinate such a meeting. (Id. ¶ 25.) In another instance, just prior to the Labor Day holiday weekend, Kiser asked Campfield to organize a company golf outing, despite the fact that Krasner and Colamaria were ordinarily responsible for supervising and organizing this type of event. (Id. ¶ 30.) Not believing Campfield to be competent for such a "high profile task," Krasner asked Kiser to reconsider this assignment. (Id. ¶ 31.) Kiser agreed to defer to Krasner on this matter; however, Krasner ultimately decided not to reassign the project. Nevertheless, after Campfield independently decided that her schedule was too full to take on this task, Kiser berated Krasner for "telling [Campfield] she couldn't do it" (id. ¶ 32), and warned Krasner that he would begin to "see a new Mr. Kiser" (id. ¶ 33).

Krasner was directed to come to Kiser's office at the start of the next business day, for the first glimpse of this "new" Kiser. (Id. ¶ 35.) Kiser told Krasner to organize a departmental meeting to address the "turbulence" caused by his leadership. (Id. ¶ 36.) Krasner viewed this call to hold a meeting -- which ultimately never came to pass -- as an "empty and retaliatory" threat. (Id. ¶ 38.) Although the meeting never occurred, Kiser's attacks on Krasner continued over the next few days, with Kiser accusing Krasner of running a dysfunctional department and calling him the "laughing-stock of the company." (Id. ¶ 39.) These words stood in stark contrast to Kiser's praise for Krasner just a week earlier for his role in raising the department's reputation. (Id. ¶¶ 14, 39.)

At that point, in the face of escalating unpleasantness, Krasner decided to apprise the human resources department of Kiser's "illicit sexual relationship with a subordinate." (Id. ¶ 45.) First, on September 6, 2007, Krasner lodged a verbal, in-person complaint with Ruth von Kistowsky, the Head of Human Resources, articulating his belief that "Kiser was violating [HSH's] ethics policy by creating a personal conflict of interest" and generally "creating an unprofessional environment." (Id. ¶¶ 40-41.) Krasner further asked von Kistowsky to inform Kiser of the complaint and to advise him to avoid any hostile or retaliatory gestures towards Krasner. (Id. ¶ 44.) Von Kistowsky told Krasner that she could "not imagine someone being in a worse situation." (Id. ¶ 42.)

Following Krasner's oral complaint, Kiser emailed Krasner in an effort to attempt to influence Krasner's decision to expose the relationship. (Id. ¶ 45.)*fn6 Thereafter, Kiser announced a restructuring of Corporate Services, creating a new department and transferring all marketing functions previously assigned to Krasner -- including supervision of Campfield and Colamaria -- to Kiser's direct command. (Id. ¶ 46.)

The next day, on September 19, Krasner again turned to the Human Resources department, this time with a written complaint, reiterating his belief that Kiser was violating the company's ethics policy and creating an unprofessional environment through his relationship with Campfield. (Id. ¶¶ 47-48; Karnofsky Decl. Ex. C.) This eight-page document did not raise any issues concerning Kiser's alleged transgressions beyond those related to the preferential treatment bestowed on Campfield, nor did it address any other office romances. (See Karnofsky Decl. Ex. C.)

Upon learning of this written complaint, Kiser immediately sought Colamaria's help in "tak[ing] care" of Krasner, a project in which Colamaria declined to participate. (Compl. ¶¶ 49-51.) From that point on, Krasner's situation at HSH worsened. He was only allowed to meet with Kiser when chaperoned by in-house counsel; was subjected to "humiliating scrutiny" of his work, including being required to provide printed and bound documentation of work product to Kiser; was not given any substantive work assignments; was excluded from major meetings; and was on the receiving end of an expansion of a planned internal audit ordered by Kiser to departments under Krasner's jurisdiction. (Id. ¶¶ 61-64, 66.)

On October 3, HSH concluded its internal investigation of Krasner's complaints and found no violation of law or internal ethics policy. (Id. ¶ 67.) A month later, on November 5, 2007, Krasner was summarily terminated, along with Colamaria, without any advance warning or explanation. (Id. ¶¶ 51-52, 70, 81-82.) Krasner was later told that his termination resulted from a combination of (1) the reduction of his responsibilities following the restructuring; (2) the failure to work satisfactorily with Kiser; (3) insubordination to Kiser; and (4) overall failure of performance. (Id. ¶ 71.) Krasner contends that these stated reasons were pretexts for Kiser's retaliation for exposing the Campfield relationship. (See id. ¶¶ 72-76.) This retaliation, Krasner alleges, is in violation of federal, state and city law, as well as of the company's own Code of Ethics, which was in place at all times during his tenure with HSH. (Id. ¶¶ 76-77.) According to Krasner, HSH's Code of Ethics prohibited it from firing an employee in retaliation for making any ...

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