EEOC v. Village at Hamilton Pointe LLC

102 F.4th 387

EQUAL EMPLOYMENT OPPORTUNITY COMMISSION, Plaintiff-Appellant, v. VILLAGE AT HAMILTON POINTE LLC, d/b/a Hamilton Pointe Health and Rehabilitation Center; d/b/a Hamilton Pointe Assisted Living Center; d/b/a The Cottages at Hamilton Pointe and Tender Loving Care Management, LLC, d/b/a TLC Management, Defendants-Appellees.

No. 22-2806

United States Court of Appeals, Seventh Circuit

Argued September 13, 2023

Decided May 9, 2024

Appeal from the United States District Court for the Southern District of Indiana, Evansville Division, No. 3:17-cv-00147 — Richard L. Young, Judge.

Gail S. Coleman, Steven John Winkelman, Attorneys, Equal Employment Opportunity Commission, Washington, DC, for Plaintiff-Appellant.

Laurie E. Martin, Amanda L.B. Mulroony, Attorneys, Hoover Hull Turner LLC, Indianapolis, IN, for Defendant-Appellee Village At Hamilton Pointe LLC.

Laurie E. Martin, Amanda L.B. Mulroony, Attorneys, Janet Lynn Thompson, Counsel, Hoover Hull Turner LLC, Indianapolis, IN, for Defendant-Appellee Tender Loving Care Management, LLC.

Before Flaum, Ripple, and Scudder, Circuit Judges.

Ripple, Circuit Judge.

The Equal Employment Opportunity Commission (the "EEOC" or "Commission") brought this Title VII employment discrimination action, 42 U.S.C. §§ 2000e-2, e-5, on behalf of black employees of Village at Hamilton Pointe, LLC ("Hamilton Pointe"), which operates a long-term care facility located in Newburgh, Indiana. This institution provides nursing, rehabilitation, and assisted living services. The Commission also named as a defendant Tender Loving Care Management, LLC, d/b/a TLC Management ("TLC"), which provides a variety of services to Hamilton Pointe. Among other matters not immediately relevant to this appeal, the Commission alleged that Hamilton Pointe and TLC had subjected the employees to racial harassment while performing their duties.

The district court granted TLC's motion for summary judgment with respect to the claims of some of the employees. The court held that, on the record before it, TLC could not be considered an employer within the meaning of Title VII of the Civil Rights Act. The court also granted Hamilton Pointe's motion for partial summary judgment with respect to the claims of forty employees. Seven remaining employees proceeded to a jury trial. The jury awarded damages to one employee. The EEOC now appeals the grant of summary judgment for TLC, the grant of partial summary judgment for Hamilton Pointe, and the jury's verdict.

We affirm the judgment of the district court. The district court correctly granted partial summary judgment on the claims of the fifteen class members before us on appeal. It committed no reversible error during the trial of the remaining racial harassment claims. Finally, the district court correctly held that TLC was not an employer within the meaning of Title VII.

BACKGROUND

The EEOC brought this action against Hamilton Pointe and TLC in the United States District Court for the Southern District of Indiana. It sued on behalf of fifty-two current and former black employees including seven charging parties named in the complaint.¹ The complaint alleged, among other matters,² that the defendants had subjected the named charging parties and a class of current and former employees to severe or pervasive harassment because of their race and therefore violated Title VII.³

As this case comes to us, it presents three distinct issues, each cast in a separate procedural posture. For ease of reading, we will first discuss the district court's grant of summary judgment to Hamilton Pointe on the racial harassment claims of most of the named employee-claimants. We will then discuss the trial of the claims of the remaining named claimants. Finally, because one of the claimants received a damages award at the trial, we will evaluate the EEOC's view that TLC can be considered a joint employer and therefore can be liable for the satisfaction of that judgment.

DISCUSSION

A

1.

We begin by setting forth the established legal principles that must guide our evaluation of the district court's grant of summary judgment on the claims of several named employees. We will then apply these principles to the district court's decision with respect to each of the fifteen employees whose claims the EEOC asks us to review.

The standards governing the grant of summary judgment are well established. We review the district court's grant of summary judgment de novo and, like the district court, take the facts and all reasonable inferences in the light most favorable to the nonmoving party. Uebelacker v. Rock Energy Coop., 54 F.4th 1008, 1010 (7th Cir. 2022). "An inference is not reasonable if it is directly contradicted by direct evidence provided at the summary judgment stage, nor is a 'conceivable' inference necessarily reasonable at summary judgment." MAO-MSO Recovery II, LLC v. State Farm Mut. Auto. Ins. Co., 994 F.3d 869, 876 (7th Cir. 2021) (quoting Cont'l Cas. Co. v. Nw. Nat'l. Ins. Co., 427 F.3d 1038, 1041 (7th Cir. 2005)). We will affirm the district court's 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). "We may affirm a district court's grant of summary judgment on any basis that is apparent from our review of the record, provided that the issue was raised and the losing parties had a fair opportunity to contest it in the district court." REXA, Inc. v. Chester, 42 F.4th 652, 662 (7th Cir. 2022).

The substantive standards for establishing a claim of a hostile work environment based on race are also well established. The EEOC must establish that (1) the employee was subject to unwelcome harassment; (2) the harassment was based on the employee's race; (3) "the harassment was so severe or pervasive as to alter the conditions of employment and create a hostile or abusive working environment"; and (4) there is a basis for employer liability. Johnson v. Advoc. Health & Hosps. Corp., 892 F.3d 887, 900 (7th Cir. 2018). We first turn to a closer examination of these elements.

In establishing that harassment was based on race, the EEOC "need not show that the complained-of conduct was explicitly racial[] but must show it had a racial character or purpose." Yancick v. Hanna Steel Corp., 653 F.3d 532, 544 (7th Cir. 2011). This practical approach recognizes that "forms of harassment that might seem neutral in terms of race ... can contribute to a hostile work environment claim if other evidence supports a reasonable inference tying the harassment to the plaintiff's protected status." Cole v. Bd. of Trustees of N. Ill. Univ., 838 F.3d 888, 896 (7th Cir. 2016). "Whether the inference is appropriate depends on the circumstances of the case; ... superficially neutral events are properly considered as part of 'the entire context of the workplace.'" Id. (quoting Cerros v. Steel Techs., Inc., 288 F.3d 1040, 1046 (7th Cir. 2002)).⁴ Although a connection between the harassment and the plaintiff's protected status need not be explicit, there must be some connection; "not every perceived unfairness in the workplace may be ascribed to discriminatory motivation merely because the complaining employee belongs to a racial minority." Beamon v. Marshall & Ilsley Trust Co., 411 F.3d 854, 863 (7th Cir. 2005); see also Zayas v. Rockford Mem'l Hosp., 740 F.3d 1154, 1159 (7th Cir. 2014).

A plaintiff must show that the alleged harassment was so severe or pervasive that it altered the conditions of his employment. Thompson v. Mem'l Hosp. of Carbondale, 625 F.3d 394, 401 (7th Cir. 2010). When determining whether the harassment was so severe or pervasive, we employ both an objective and a subjective test. Faragher v. City of Boca Raton, 524 U.S. 775, 787, 118 S.Ct. 2275, 141 L.Ed.2d 662 (1998); see also EEOC v. Costco Wholesale Corp., 903 F.3d 618, 625 (7th Cir. 2018). The subjective beliefs of an employee are not sufficient alone to meet this standard. Yancick, 653 F.3d at 548.⁵ "[T]he environment must be one that a reasonable person would find hostile or abusive, and one that the victim in fact did perceive to be so." Smith v. Ne. Ill. Univ., 388 F.3d 559, 566 (7th Cir. 2004) (quotations omitted).

To determine whether the harassing conduct created an environment that was "objectively hostile, we consider the totality of the circumstances, including: 'the frequency of the discriminatory conduct; its severity; whether it is physically threatening or humiliating, or a mere offensive utterance; and whether it unreasonably interferes with an employee's work performance.'" Alamo v. Bliss, 864 F.3d 541, 549-50 (7th Cir. 2017) (quoting Harris v. Forklift Sys., Inc., 510 U.S. 17, 23, 114 S.Ct. 367, 126 L.Ed.2d 295 (1993)). See also Oncale v. Sundowner Offshore Servs., Inc., 523 U.S. 75, 81, 118 S.Ct. 998, 140 L.Ed.2d 201 (1998). "Offhand comments, isolated incidents, and simple teasing do not rise to the level of conduct that alters the terms and conditions of employment." Passananti v. Cook Cnty., 689 F.3d 655, 667 (7th Cir. 2012).

Because harassment need not be both severe and pervasive to establish a hostile work environment, "[a] 'severe episode' that occurs 'as rarely as once' or a 'relentless pattern of lesser harassment'" can be sufficient to meet the standard. Alamo, 864 F.3d at 550 (quoting Cerros v. Steel Techs., Inc., 398 F.3d 944, 951 (7th Cir. 2005)). Again, in assessing the impact of the conduct under this totality of the circumstances approach, we consider "the specific circumstances of the working environment and the relationship between the harassing party and the harassed." Robinson v. Sappington, 351 F.3d 317, 330 (7th Cir. 2003). The context is crucial to an accurate appreciation of the impact a harasser's conduct had on the work environment. Scaife v. United States Dep't of Veterans Affs., 49 F.4th 1109, 1116 (7th Cir. 2022). We "have repeatedly treated a supervisor's...