Doyle v. Advanced Fraud Sols., LLC
| Decision Date | 19 March 2020 |
| Docket Number | 1:18CV885 |
| Court | U.S. District Court — Middle District of North Carolina |
| Parties | KEVIN DOYLE and HASHIM WARREN, Plaintiffs, v. ADVANCED FRAUD SOLUTIONS, LLC, and THOMAS LAWRENCE REAVES, JR., Defendants. |
Currently before the court is Defendant Advanced Fraud Solution, LLC's ("AFS") Motion to Dismiss pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. (Doc. 13.) Plaintiffs' Complaint lists four claims, including Unlawful Employment Discrimination/ Retaliation in violation of 42 U.S.C. § 2000e-3, two state law claims, and a claim for punitive damages. (Complaint ("Compl.") (Doc. 1) ¶¶ 57-97). AFS moves for a dismissal of Claims One and Two. Claim Three is directed only at Defendant Thomas Lawrence Reaves, Jr. ("Reaves"). This court finds that Claim One should be dismissed pursuant to Federal Rule of Civil Procedure 12(b)(6). The court will decline to exercise jurisdiction over the remaining state claims, Claims Two and Three, and will dismiss Claim Four as moot.
Plaintiffs Kevin Doyle ("Doyle") and Hashim Warren ("Warren") (collectively "Plaintiffs") were both employed in AFS's marketing department and performed work for The Coder Foundry, LLC.1 (Compl. (Doc. 1) ¶¶ 10-14.) Reaves was the President of AFS and supervised Warren, the Director of Marketing, who in turn supervised Doyle, the Marketing Coordinator. (Id. ¶¶ 10-13.) Plaintiffs and Defendant Reaves are all citizens of North Carolina; Defendant AFS is a limited liability company organized under the laws of North Carolina. (Id. ¶¶ 2-4.) Plaintiffs does not allege the citizenship of AFS's members.2
Plaintiffs allege that Reaves began an affair with a female subordinate in either late 2016 or early 2017, subsequently transferred this employee from Coder Foundry to AFS, gave her asubstantial pay raise, and provided her with favorable treatment compared to similarly situated male employees. (Id. ¶¶ 18-19.) The favorable treatment allegedly included allowing the female employee to work from home while male employees were not. (Id. ¶¶ 19, 20.) Plaintiffs further allege that Reaves provided benefits to this female employee "at the company's expense that did not seem appropriate," such as meals and hotel rooms. (Id. ¶ 22.) Plaintiffs state that they believe Reaves had previously engaged in a similar relationship with at least one other subordinate female employee. (Id. ¶ 25.) Doyle reported to Warren that Reaves was showing "favoritism towards the Female Employee . . . ." (Id. ¶ 23.) "Plaintiffs believed that Reaves' misuse of company funds to further his relationship with the Female Employee" were acts of embezzlement. (Id. ¶ 24.) Plaintiffs then approached Bobby Davis, a member of the AFS board:
(Id. ¶¶ 27-28 (footnote omitted).) After the meeting, AFS's human resources ("HR") department then investigated, took statements from Plaintiffs, and concluded that Reaves had behaved inappropriately and misused company funds. (Id. ¶¶ 30-32, 35.)
While the HR investigation was winding up, Warren filed a charge of discrimination with the Equal Employment Opportunity Commission ("EEOC") on April 14, 2017, but he subsequently withdrew the charge after the precipitating grievance was remedied. (Id. ¶ 34). The Complaint does not state how much time passed between the filing of the first charge and its withdrawal. (See id.) On April 17, 2017, the AFS board issued a letter of reprimand to Reaves and had his responsibilities cut back, including his removal as director of the Coder Foundry. (Id. ¶¶ 31-33, 35.) The female employee in question was assigned a different supervisor. (Id. ¶ 35.)
AFS's HR department also informed Reaves that Plaintiffs would be reporting to Davis, not him, until further notice. (Id. ¶ 36). Though Plaintiffs were no longer reporting to Reaves, he continued to exercise control over them. (Id. ¶ 37.) Plaintiffs allege that "[a]lmost immediately after Reaves was reprimanded, [Reaves] began a campaign of overt retaliation against thePlaintiffs." (Id. ¶ 38.) This course of retaliation included withholding work from Plaintiffs, stripping Plaintiff Warren of his authority and titles, spreading rumors about Plaintiffs, changing passwords, removing furniture from Plaintiffs' offices, and eventually transferring Plaintiffs entirely to Coder Foundry. (Id. ¶¶ 38-42, 46.) Plaintiffs allege that the transfer to Coder Foundry reduced their benefits and negatively impacted their career prospects, (id. ¶ 47), because Coder Foundry was on the brink of insolvency when they were transferred, (id. ¶ 51). When Coder Foundry declared bankruptcy in November 2017, Plaintiffs were terminated. (Id.) Warren filed a second EEOC charge on November 20, 2017, and Doyle filed his charge on November 30, 2017. (Id. ¶¶ 34, 53-54.) The EEOC issued a right-to-sue letter to each Plaintiff.
Plaintiffs bring the following claims against AFS: (1) Title VII retaliation for engaging in protected activity and (2) wrongful discharge in violation of public policy under N.C. Gen. Stat. § 143-422.2, for reporting suspected discrimination and embezzlement. Plaintiffs also bring a claim for tortious interference with contract against Reaves in his individual capacity (Claim Three), and a claim for punitive damages against Reaves and AFS (Claim Four). Defendant AFS filed a Motion toDismiss for Failure to State a Claim, (Doc. 13), as well as a supporting brief, (Def.'s Br. in Supp. of Mot. to Dismiss ("Def.'s Br.") (Doc. 14). Plaintiffs filed a Response in Opposition to Defendant AFS' Motion to Dismiss, (Pls.' Mem. of Law in Opp'n to Def.'s Mot. to Dismiss ( ) (Doc. 17), and Defendant AFS filed a Reply, (Doc. 18). The issue is now ripe for ruling.
To survive a Rule 12(b)(6) motion, "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is plausible on its face if "the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable" and demonstrates "more than a sheer possibility that a defendant has acted unlawfully." Iqbal, 556 U.S. at 678 (citing Twombly, 550 U.S. at 556-57). When ruling on a motion to dismiss, this court accepts the complaint's factual allegations as true. Iqbal, 556 U.S. at 678. Further, this court liberally construes "the complaint, including all reasonable inferences therefrom, . . . in plaintiff's favor." Estate of Williams-Moore v. All. One Receivables Mgmt., Inc., 335 F. Supp. 2d 636, 646(M.D.N.C. 2004) (citation omitted); see also Mason v. Mach. Zone, Inc., 851 F.3d 315, 319 (4th Cir. 2017). This court does not, however, accept legal conclusions as true, and "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Iqbal, 556 U.S. at 678.
The court addresses Plaintiffs' first claim against AFS for Employment Discrimination/Retaliation under 42 U.S.C. § 2000e-3. (Compl. (Doc. 1) ¶¶ 57-72.) Since the court finds Plaintiffs did not harbor an objectively reasonable belief that they were opposing conduct made illegal by Title VII, the court finds that Claim One should be dismissed.
It is unlawful for an employer to discriminate against an employee "because he has opposed any practice made an unlawful employment practice by this subchapter, or because he has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under this subchapter." 42 U.S.C. § 2000e-3(a). Plaintiffs with a Title VII retaliation claim must allege facts that allow a court to find the following elements: "(1) that she engaged in protected activity; (2) that [the employer] took a material adverse employment action against her, and (3) that a causal connection existed between theprotected activity and the adverse action." Peters v. Jenney, 327 F.3d 307, 320 (4th Cir. 2003); see also Savage v. Maryland, 896 F.3d 260, 276 (4th Cir. 2018). A plaintiff may survive a motion to dismiss by alleging direct evidence of a retaliation, Peters, 327 F.3d at 320 n.15, but the parties in the case at bar appear to assume that the prima facie case is the appropriate metric, ). Seeing no alleged direct evidence of retaliation, this court will proceed under the same theory.
There are two kinds of activity for which Title VII provides protection from retaliation, and Section 2000e-3(a) identifies them in two clauses. The first clause of the statute is known as the "opposition" clause; the second is known as the "participation" clause. Crawford v. Metro. Gov't of Nashville & Davidson Cty., 555 U.S. 271, 274 (2009). The distinction is important as it pertains to the first element of a prima facie case for retaliation. In order to qualify as "protected activity" under the opposition clause, a plaintiff must show they had an objectively reasonable belief the conduct they were opposing...
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