Serapion v. Martinez
| Decision Date | 24 September 1996 |
| Docket Number | Civil No. 93-1790(SEC). |
| Citation | 942 F.Supp. 80 |
| Parties | Margarita SERAPION, Plaintiff, v. Fred H. MARTINEZ, et al., Defendants. |
| Court | U.S. District Court — District of Puerto Rico |
Judith Berkan, Río Piedras, PR and Rosalinda Pesquera, Elias, Dávila & Baez, Hato Rey, PR, for Plaintiff.
Alvaro R. Calderón, Jr., Hato Rey, PR, for Defendants.
Pending before the Court is defendants' "Second Motion for Summary Judgment" (Docket # 48). Plaintiff, Margarita Serapión, has filed a Title VII complaint against Fred H. Martínez, Lawrence Odell and José Luis Calabria — partners at the law firm of Martínez, Odell & Calabria ("MOC") — in which she alleges that, while a partner at the firm,1 she was denied the right to achieve full partnership on account of her gender.2 She further contends that she has a state law claim under Act 100, 29 L.P.R.A. § 146, and requests that the Court assume pendent jurisdiction as to that claim.
Defendants first filed a motion for summary judgment on July 13, 1993. Essentially, they argued that, since plaintiff was a partner at the firm, she was not an "employee" for purposes of Title VII of the Civil Rights Act, 41 U.S.C. § 2000(e). Chief Judge Cerezo, who was presiding over the case at the time, denied the motion on the ground that there were genuine issues of material fact and questions of credibility which were not suitable for summary judgment. A year and a half later, having completed discovery and further examined all pertinent evidence, defendants filed a second motion for summary judgment based, inter alia, on the following grounds: (1) that plaintiff was exempted from coverage as an employee under Title VII because she was a proprietary partner at MOCS and a member of its Executive Committee and Board of Partners; (2) that plaintiff could not establish a prima facie case of discrimination under Title VII; (3) that neither the individual defendants, Fred Martínez, Lawrence Odell, José Luis Calabria, nor their respective spouses could be held liable under Title VII inasmuch as they could not be deemed plaintiff's employers; and (4) that this Court should decline to exercise supplemental jurisdiction.
Defendants submitted a Rule 311.12 Statement of Uncontested Facts and forty-six exhibits in support of the motion, which was duly opposed. On April 16, 1996, defendants further submitted a comparison and analysis of plaintiff's Response to Defendants' Rule 311.12 Statement of Uncontested Facts. Having reviewed all the motions, memoranda and exhibits submitted by the parties, the Court GRANTS defendants' second motion for summary judgment (Docket # 48) for the reasons stated below.
On or about September of 1979, co-defendants Martínez, Odell and Calabria joined Antonio J. Colorado and Ralph Sierra to establish a partnership for the practice of law, under the name of Colorado, Martínez, Odell, Calabria & Sierra ("CMOCS"). Shortly thereafter, Colorado extended plaintiff, a recent graduate from the University of Puerto Rico Law School, an offer to join the firm as an associate. Nevertheless, in August of 1983, plaintiff resigned from her employment as an associate with CMOCS to join the Puerto Rico Treasury Department as Assistant Secretary for Internal Revenue and Collections, a position which she held until March of 1985. Docket # 61, Plaintiff's Rule 311 Statement of Uncontested Facts, Exhibit 1, at 2. Upon completion of her tenure, plaintiff accepted Odell's offer to rejoin the firm as a senior associate in the firm's Tax Department.3 Docket # 61, Exhibit 1, at 2. Her initial compensation package included benefits such as paid life insurance, pension plan accruals, payment for half the cost of the medical plan, a $2,000.00 expense allocation for seminars, and participation in the annual law firm outing. Plaintiff became the first associate ever to receive a car allowance. Her compensation was also higher than that received by any other male or female associate, except for then senior associate Graciela Belaval, who had ten years of experience as a litigation attorney. Docket # 48, Defendants' Rule 311.12 Statement of Uncontested Facts, at 1-3.
A year and a half after she was rehired as an associate, plaintiff was promoted to junior partner, as a result of which her compensation package increased further. Unlike her predecessors, plaintiff was not required to invest in the law firm in order to become a junior partner. Docket # 48, Statement of Uncontested Facts, at 4-5. In May of 1989, while still a junior partner, plaintiff married a fellow attorney at the firm's Tax Department, Mr. John Belk. She did not disclose this fact to the senior partners, or to anyone else at the firm. Docket # 61, at 14.
Shortly thereafter, on January of 1990, plaintiff became the only person ever to be promoted to proprietary partner from within the firm. Once again, she was spared the requirement of having to contribute to the firm's capital. The other partners each ceded her one percent (1%) of their equity participation in the firm, for a total equity participation of 4%. Docket # 61, Exhibit 1, at 4. Upon her promotion, plaintiff became entitled to the fifth vote in the firm's Executive Committee and actively participated in most of the Committee's regular meetings. Docket # 48, Statement of Uncontested Facts, at 5-7.
Plaintiff's phase-in period toward full participation in the firm's profits was discussed at an Executive Committee meeting held on December 8, 1990. It was finally decided that "Ms. Serapión's parity with all other Proprietary Partners would be phased in during a period of three years from her admission as Proprietary Partner," and that "[a]t the end of the three year period she would be at parity with respect to compensation, distributions, units, and any other form of compensation to which the four other Proprietary Partners are entitled." Docket # 48, Exhibit 6, at 58.
Plaintiff's salary upon becoming proprietary partner was raised to $60,183.00, with an expense allocation of $16,400.00, a car allowance of $10,800.00 a year, and bonuses in the amount of $42,050.00 during the first year of partnership. Her compensation package was fixed at seventy-five percent (75%) of that of the four senior proprietary partners. Docket # 61, Exhibit 1, at 4. Thereafter, she received wage increases which placed her total compensation at the dissolution of the firm in 1992 at ninety-two percent (92%) of the compensation of the remaining senior proprietary partners. Docket # 48, Statement of Uncontested Facts, at 9.
The partnership agreement under which MOCS operated from its inception required a vote of four out of five of the proprietary partners for any decision affecting the firm. That gave plaintiff twenty percent (20%) of the voting power, a power which, according to the documentary evidence submitted by defendants, she exercised in matters like (1) the election of junior partners;4 (2) performance evaluations; (3) work assignments; (4) the recruitment of additional counsel; (5) setting the firm's policy; (6) the engagement of experts; (7) profit distribution; (8) the promotion of associates; (9) the execution of amended partnership contracts; (10) the disciplining of employees; (11) the exercise of control over the firm's finances; (12) the approval of benefits to junior partners; (13) serving as signatory to the firm's bank accounts; (14) determining litigation strategies; (15) increasing the professional fees charged by the firm; (16) quality control; and (17) negotiations as to office space and relocation. Docket # 48, Statement of Uncontested Facts, at 13-26.
As early as 1984, plaintiff's fellow tax partner and head of the Tax Department, Ralph Sierra, began experiencing serious professional differences with senior partners Martínez, Odell and Calabria. On two occasions, Sierra suggested that Martínez cease to appear as the first-named partner. Docket # 48, Exhibit 11. In an internal memorandum dated January 17, 1989, Sierra stated that he would no longer accept responsibility for any engagements as to which Martínez had overall client responsibility. Docket # 48, Exhibit 29. He also expressed his intention to "openly seek alternative professional opportunities outside the Firm". Id. During the month of May, 1989, Sierra stopped going to the office altogether, and communicated with the firm only by telephone or fax. Docket # 48, Statement of Uncontested Facts, at 28-29. Finally, in a memo he wrote on January 14, 1992, he included Calabria's retirement as an issue to be discussed in their executive committee meeting, although Calabria was not interested in retirement at that point. Id. at 32.
Calabria reacted to the ongoing controversy with a memorandum to all proprietary partners, in which he asked them to try to avoid the "nightmarish ordeal of dissolving a firm the size of ours." Docket # 48, Exhibit 30. As a possible solution to these internecine disputes, Martínez subsequently suggested the possibility of recruiting a Senior Tax Partner that did not respond to Mr. Sierra. Docket # 48, Statement of Uncontested Facts, at 31.
Plaintiff backed Sierra on all of the preceding partnership disputes, a fact which often led to an impasse in the Executive Committee's decision-making processes. For instance, on March 20, 1992, Odell addressed a memorandum to all partners, in which he expressed his desire to restructure the firm. Plaintiff coalesced with Sierra in order to defeat this motion. Id. at 31.
Given the stalemate which the forgoing polarization of MOCS into two factions provoked, Sierra suggested that the firm retain the services of a management consulting firm to review its problems. The other proprietary partners agreed, and Hildebrandt, Inc. was retained to conduct an evaluation of the problems affecting the firm, and to make recommendations thereafter. Id. at 32. Based on the research which they performed, the...
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Serapion v. Martinez
...had been developed in federal jurisprudence and that she was thus ineligible for the prophylaxis of Title VII. See Serapin v. Martnez, 942 F.Supp. 80, 84-85 (D.P.R.1996). The court held alternatively that Serapin had failed to make out a prima facie case of discrimination under Title VII. S......