Ferguson v. Michael Foods, Inc.

74 F.Supp.2d 862

Carmen M. FERGUSON, Plaintiff, v. MICHAEL FOODS, INC.; Northern Star Company; M.G. Waldbaum; J.D. Clarkson; and Ron Bergman, Defendants.

No. 98-1386 (DSD/JMM).

United States District Court, D. Minnesota.

August 24, 1999.

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John D. Thompson, Todd P. Zettler, Rider, Bennett, Egan & Arundel, Minneapolis, MN, for plaintiff.

Linda L. Holstein, Parsinen, Kaplan, Levy, Rosberg & Gotlieb, Minneapolis, MN, Geoffrey P. Jarpe, Jeffrey B. Stites, Maun and Simon, Minneapolis, MN, for defendants.

ORDER

DOTY, District Judge.

This matter is before the court on (1) defendants' motion for summary judgment and (2) plaintiff's appeal of Magistrate Judge Mason's May 20, 1999 order denying plaintiff's motion to amend her complaint. Based on a review of the file, record, and proceedings herein, the court (1) grants in part and denies in part defendants' motion and (2) affirms the magistrate judge's order.

BACKGROUND

In 1974, plaintiff Carmen Ferguson began working at defendant Northern Star Company, a food processing subsidiary of defendant Michael Foods, Inc. After working her way up the ranks at Northern Star, Ferguson became director of human resources in 1991, running a department that oversaw the human resource needs of well over 500 employees. By 1996, she was earning a salary of $62,140, with a bonus potential of 30 percent of base salary. The record evidence reflects that Northern Star was fully satisfied with her performance prior to the events at issue in this case.

In August 1995, J.D. Clarkson became president of Northern Star. Ferguson and other employees of Northern Star allege that Clarkson immediately made it known that he preferred not to have women playing important roles in the workplace. Ferguson also alleges that, early in Clarkson's tenure at Northern Star, he confided to her that he no longer fires people but instead makes them so miserable that they quit. Further, Ferguson asserts that Clarkson would, on occasion, make derogatory and lewd comments about women while he was at work.

In February 1996, Cathy Mensing, an employee working in Northern Star's Human Resources Department, submitted a letter complaining that she had been sexually harassed by executive vice president Tom Welna and company controller Max Hoffman. In response, the Michael Foods CEO Gregg Ostrander decided to conduct an internal investigation. Ostrander appointed Anita Darnell as lead investigator. Darnell, a former colleague of Clarkson, was human resources manager at Crystal Farms, another Michael Foods subsidiary. After completing her investigation, which Ferguson alleges was carried out in close consultation with Clarkson, Darnell recommended that Welna and Ferguson be removed from their jobs. In March 1996, Ferguson was displaced from her job at Northern Star and transferred to a human resources position at defendant M.G. Waldbaum, also a subsidiary of Michael Foods, where she began working under the supervision of defendant Ron Bergman, whom Ferguson had previously considered a corporate peer. Ferguson lost her 30 percent growth bonus and her seat on the corporate-wide human resources policy committee. Welna and Hoffman remained in their positions.

In November 1996, after Ferguson's transfer to Waldbaum, Occupational Safety and Health Administration ("OSHA") Inspector Don Voss visited Northern Star, responding to the complaint of an employee who had injured his hand while at work. Voss immediately noticed certain mathematical errors on the face of the company's OSHA logs and asked Northern Star officials to correct the problems by the following Monday. Clarkson called in Bergman to examine the logs. Rather than merely correcting the errors, however, Bergman conducted a complete audit, spending an entire week, with the assistance of four other employees, recreating the OSHA logs. Bergman concluded from his investigation that Ferguson, who had been in charge of completing the OSHA logs when she worked at Northern Star, had intentionally falsified the records. On December 2, 1996, Bergman met with Ferguson and asked her what explanation she had for the condition of the OSHA logs. When Ferguson asked for the opportunity to examine the logs herself, Bergman refused and, at the close of the meeting, asked for her elevator pass and key. The following day, Bergman called her on the phone and told her that she was fired. Two days later, Bergman gave Ferguson a document stating the official reason for her termination: the falsification of company records.

After Ferguson's termination, Bergman informed several executives at Michael Foods that Ferguson had falsified the OSHA logs. Thereafter, both Michael Foods CEO Ostrander and Bergman told Jeff Shapiro that Ferguson had falsified the OSHA records. Shapiro then contacted an insurance carrier and an insurance broker about the incident and its possible consequences with regard to insurance matters.

On May 11, 1998, Ferguson filed a complaint in federal court containing a number of counts, including sexual harassment, gender discrimination, and retaliation in violation of the Minnesota Human Rights Act ("MHRA") and Title VII of the Civil Rights Act, defamation, and tortious interference with employment contract. Defendants removed to federal court. After a period of discovery, defendants bring a motion for summary judgment. Ferguson appeals an order by Magistrate Judge Mason denying her motion to amend her complaint to assert a claim for punitive damages.

DISCUSSION

A. Standard for Summary Judgment

Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment is appropriate "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." In order for the moving party to prevail, it must demonstrate to the court that "there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986); Fed.R.Civ.P. 56(c). A fact is material only when its resolution affects the outcome of the case. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202. A dispute is genuine if the evidence is such that it could cause a reasonable jury to return a verdict for either party. See id. at 252, 106 S.Ct. 2505.

On a motion for summary judgment, all evidence and inferences are to be viewed in a light most favorable to the nonmoving party. See id. at 250, 106 S.Ct. 2505. The nonmoving party, however, may not rest upon mere denials or allegations in the pleadings, but must set forth specific facts sufficient to raise a genuine issue for trial. See Celotex, 477 U.S. at 324, 106 S.Ct. 2548. Moreover, if a plaintiff cannot support each essential element of its claim, summary judgment must be granted because a complete failure of proof regarding an essential element necessarily renders all other facts immaterial. See id. at 322-23, 106 S.Ct. 2548.

B. Title VII and MHRA Clams

In Counts I and II of her complaint, Ferguson brings identical sexual harassment, gender discrimination, and retaliation claims under Title VII and MHRA. Whether brought under Title VII or the MHRA, Ferguson's claims are subject to the same legal analysis. See Sigurdson v. Isanti County, 386 N.W.2d 715, 719 (Minn. 1986) (interpreting legal analysis for MHRA as equivalent to Title VII); see also Hanenburg v. Principal Mut. Life Ins. Co., 118 F.3d 570, 574 (8th Cir.1997) (applying principles of Title VII to cases under MHRA "because of the substantial similarities between the two statutes"); Hubbard v. United Press Int'l, Inc., 330 N.W.2d 428, 444 (Minn.1983) (analyzing MHRA retaliation claim under McDonnell Douglas framework).

1. Sexual Harassment

To establish a sexually hostile work environment in violation of the Title VII, Ferguson must establish (1) that she belongs to a protected group; (2) that she was subject to unwelcome harassment; (3) that the harassment was based on her status as a member of a protected group; and (4) that the harassment affected a term, condition, or privilege of employment. See, e.g., Phillips v. Taco Bell Corp., 156 F.3d 884, 888 n. 4 (8th Cir.1998). Harassment is actionable if it is "`sufficiently severe or pervasive to alter the conditions of the victim's employment and create an abusive working environment.'" Harris v. Forklift Systems, Inc., 510 U.S. 17, 21, 114 S.Ct. 367, 126 L.Ed.2d 295 (1993) (quoting Meritor Sav. Bank, FSB v. Vinson, 477 U.S. 57, 67, 106 S.Ct. 2399, 91 L.Ed.2d 49 (1986)). The conduct in question "must be sufficient to create a hostile environment, both as it would be viewed objectively by a reasonable person and as it was actually viewed subjectively by the victim." Howard v. Burns Bros., Inc., 149 F.3d 835, 840 (8th Cir.1998) (citing Harris, 510 U.S. at 21-22, 114 S.Ct. 367); see also Rorie v. United Parcel Service, Inc., 151 F.3d 757, 761 (8th Cir.1998). The court must examine 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." Harris, 510 U.S. at 23, 114 S.Ct. 367; see also Faragher v. City of Boca Raton, 524 U.S. 775, 118 S.Ct. 2275, 2283, 141 L.Ed.2d 662 (1998). "[S]imple teasing ... offhand comments, and isolated incidents (unless extremely serious) will not amount to discriminatory changes in the terms and conditions of employment." Id. Accordingly, "`the ordinary tribulations of the workplace, such as the sporadic use of abusive language ... and occasional teasing are not actionable.'" Wallin v....