Davis v. Ricketts

Citation765 F.3d 823
Decision Date03 October 2014
Docket NumberNo. 13–2388.,13–2388.
PartiesPatricia J. DAVIS, an Individual; Patricia A. Duncan, an Individual; Jeffrey J. Goergen, Plaintiffs–Appellants v. J. Joe RICKETTS, an Individual; Hugo Enterprises, LLC, a Nebraska Limited Liability Company, formerly known as Ricketts Enterprises, LLC; Opportunity Education Foundation, an Iowa Non–Profit Corporation, Defendants–Appellees. ADP TotalSource, Inc., a Florida Corporation, Defendant.
CourtUnited States Courts of Appeals. United States Court of Appeals (8th Circuit)

765 F.3d 823

Patricia J. DAVIS, an Individual; Patricia A. Duncan, an Individual; Jeffrey J. Goergen, Plaintiffs–Appellants
v.
J. Joe RICKETTS, an Individual; Hugo Enterprises, LLC, a Nebraska Limited Liability Company, formerly known as Ricketts Enterprises, LLC; Opportunity Education Foundation, an Iowa Non–Profit Corporation, Defendants–Appellees.

ADP TotalSource, Inc., a Florida Corporation, Defendant.

No. 13–2388.

United States Court of Appeals,
Eighth Circuit.

Submitted: May 15, 2014.
Filed: Aug. 27, 2014.

Rehearing and Rehearing En Banc Denied Oct. 3, 2014.


[765 F.3d 825]


Michael J. Merrick, argued, Chicago, IL (Brian D. Ekstrom, Chicago, IL., John C. O'Connor, Chicago, IL, on the brief), for appellant.

Thomas J. Piskorski, argued, Chicago, IL (Ellen Elizabeth McLaughlin, Kara L. Goodwin, Tracy Marie Billows, Chicago, IL, on the brief) for appellee.


Before RILEY, Chief Judge, BEAM and SHEPHERD, Circuit Judges.

SHEPHERD, Circuit Judge.

Appellants Patricia J. Davis, Patricia A. Duncan, and Davis's son, Jeffrey J. Goergen, brought suit against Opportunity Education Foundation (OEF) and Hugo Enterprises, LLC (Hugo) under Title VII of the Civil Rights Act of 1964 and the Nebraska Fair Employment Practices Act (NFEPA), alleging sexual harassment and retaliation. Davis and Duncan also sued Joe Ricketts, the Chief Executive Officer of OEF and owner of Hugo, for tortious interference with their expectation of continued employment. The district court 1 dismissed the tortious interference claim, finding Davis and Duncan had failed to state a claim against Ricketts because he was acting on behalf of OEF and thus could not be a third party interferer. The district court later granted OEF and Hugo's motion for summary judgment, concluding that OEF did not have the requisite number of employees to be considered an employer under Title VII and the NFEPA and that OEF and Hugo were not integrated employers to meet the numerosity requirement under the statutes.2 We affirm.

I.

We recite the facts in the light most favorable to the appellants, the nonmoving parties. Dovenmuehler v. St. Cloud Hosp., 509 F.3d 435, 437 (8th Cir.2007). Ricketts established OEF, an Iowa nonprofit corporation with its principal place of business in Omaha, Nebraska. It provides educational support and materials to schools in developing countries. Ricketts also owns, funds, and is managing member

[765 F.3d 826]

of Hugo, a for-profit limited liability company organized under the law of Nebraska with its principal place of business in Denver, Colorado. Hugo provides some administrative infrastructure for Ricketts' various for-profit and nonprofit enterprises, including OEF.

The Appellants were all employed by OEF in different capacities. In 2009, Davis and Duncan complained internally that OEF's Chief Operating Officer was sexually harassing them. Both Davis and Duncan were thereafter terminated. About a year later, Goergen was also terminated. Davis and Duncan filed suit, asserting that OEF and Hugo subjected them to a hostile work environment and quid pro quo sexual harassment in violation of Title VII, retaliated against them by perpetuating the hostile work environment and by firing them in violation of Title VII and the NFEPA, and retaliated against Davis by terminating Goergen in violation of Title VII and the NFEPA. They also asserted that Ricketts violated Nebraska common law by tortiously interfering with Davis's and Duncan's expectation of continued employment.

OEF, Hugo, and Ricketts moved to dismiss the Complaint. The district court granted the motion in part, finding that Davis and Duncan had failed to state a claim against Ricketts because the allegations against him were “conclusory and ‘a formulaic recitation of the elements of a cause of action,’ ” Davis and Duncan did not show that a claim could be brought against the employer's CEO, and the action would undermine precedent holding that supervisors are not individually liable under Title VII.

The Appellants then filed their First Amended Complaint, adding Goergen as a plaintiff and including him on the retaliation claims. At the conclusion of discovery, Hugo and OEF filed a motion for summary judgment as to the remaining claims under Title VII and the NFEPA. The district court granted the motion, holding that the undisputed facts demonstrated OEF at all times had fewer than 15 employees and that OEF and Hugo were not a joint, consolidated, or integrated employer. Thus, their employees could not be grouped for the purposes of the numerosity requirements in Title VII and the NFEPA. The Appellants appeal.

II.

The Appellants argue that the district court erred in granting summary judgment to Hugo and OEF because the entities are integrated and in dismissing their claim against Ricketts because they stated a plausible claim that he tortiously interfered with their business relationships. Because we find that the undisputed facts in the record show that OEF and Hugo are not an integrated enterprise and because we agree with the district court that Ricketts, as CEO of OEF and acting on behalf of OEF cannot be a third party interferer, we affirm the district court.

A. Integrated Enterprise

We review a district court's grant of summary judgment de novo. Holland v. Sam's Club, 487 F.3d 641, 643 (8th Cir.2007). We will affirm the grant of summary judgment “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). Title VII imposes liability for employment discrimination only on an “employer.” 42 U.S.C. § 2000e–2(a). An employer is defined as “a person engaged in an industry affecting commerce who has fifteen or more employees [during a certain time period.]” 42 U.S.C. § 2000e(b); see alsoNeb.Rev.Stat. § 48–1102(2) (utilizing a similar definition for employer). The

[765 F.3d 827]

parties agree that OEF did not employ 15 or more employees. However, in certain circumstances, employees of separate entities may be combined for purposes of meeting the employee numerosity requirement. Artis v. Francis Howell N. Band Booster Ass'n, Inc., 161 F.3d 1178, 1184 (8th Cir.1998). The Nebraska legislature patterned the NFEPA after Title VII, and Nebraska courts consider federal court decisions when construing its language. Bluff's Vision Clinic, P.C. v. Krzyzanowski, 251 Neb. 116, 555 N.W.2d 556, 559 (1996). Thus, we analyze the Title VII and NFEPA claims together.

An integrated enterprise is “one in which the operations of two or more employers are considered so intertwined that they can be considered the single employer of the charging party.” EEOC Compliance Manual § 2–III(B)(1)(a)(iii); see also Baker v. Stuart Broad. Co., 560 F.2d 389, 391–92 (8th Cir.1977) (“[The entities] are of such coagulation that they must be considered one.”). In determining whether separate entities should be treated as an integrated enterprise, we consider the following factors: (1) the degree of interrelation between the operations, (2) the degree to which the entities share common management, (3) the centralized control of labor relations, and (4) the degree of common ownership or financial control over the entities. Baker, 560 F.2d at 391–92; see also Sandoval v. Am. Bldg. Maintenance Indus., Inc., 578 F.3d 787, 796 (8th Cir.2009); EEOC Compliance Manual § 2–III(B)(1)(a)(iii). In situations where the court is asked to disregard the separate and distinct form of legal entities, the standards are narrow and rigorous, imposing a presumption of corporate separateness. See Robinson v. Terex Corp., 439 F.3d 465, 468 (8th Cir.2006) (noting that, in the context of a parent-subsidiary relationship, “[s]eparate corporate entities should be disregarded only when there is some abuse of the privilege to operate as separate corporations to the detriment of a third party”); see also Brown v. Fred's, Inc., 494 F.3d 736, 739 (8th Cir.2007); In re B.J. McAdams, Inc., 66 F.3d 931, 937 (8th Cir.1995) (applying the alter-ego doctrine).

The interrelation of operations factor examines whether the two entities share managers and personnel, payroll, insurance programs, office space, and equipment. Sandoval, 578 F.3d at 793; EEOC Compliance Manual § 2–III(B)(1)(a)(iii). It also requires evaluation of whether the entities are operated as a single unit, Sandoval, 578 F.3d at 796, and whether the entities' functions and purpose are similar or distinct. See Grace v. USCAR, 521 F.3d 655, 665 (6th Cir.2008); see also Engelhardt v. S.P. Richards Co., 472 F.3d 1, 6–7 (1st Cir.2006) (finding no interrelation of operations when companies had separate headquarters, human resource departments, records and record keeping, and work sites which fulfilled distinct functions). The...

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  • Cromwell v. Williams
    • United States
    • Court of Appeals of Mississippi
    • January 18, 2022
    ...his or her employment is not a third party to a contract and cannot be sued individually for tortious interference); Davis v. Ricketts , 765 F.3d 823, 829-30 (8th Cir. 2014) (The Nebraska Supreme Court has held that a supervisor cannot become a third party if his or her actions were "commit......
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