Painter v. Midwest Health, Inc.

MEMORANDUM AND ORDER

DANIEL D. CRABTREE, UNITED STATES DISTRICT JUDGE

Plaintiff Wendy L. Painter brings this employment discrimination lawsuit against defendants Midwest Health, Inc. (“Midwest Health”) and Pioneer Ridge Nursing Facility Operations, LLC (“Pioneer Ridge Nursing”). She asserts six claims: (1) reverse race discrimination violating Title VII of the Civil Rights of 1964 (“Title VII”), 42 U.S.C. § 2000e; (2) retaliation violating Title VII, 42 U.S.C. § 2000e; (3) reverse race discrimination violating 42 U.S.C. § 1981; (4) retaliation violating 42 U.S.C. § 1981; (5) a Kansas common law claim for tortious interference with prospective contractual relationship or expectancy; and (6) blacklisting violating Kan. Ann. Stat. §§ 44-117 and 44-119. Doc. 77 at 9 (Pretrial Order ¶ 4.a.).

This matter comes before the court on defendants' Motion for Summary Judgment (Doc. 78) and plaintiff's Motion to Certify Questions of Law to Kansas Supreme Court (Doc. 100). Plaintiff filed a Response (Doc. 93). And defendants filed a Reply (Doc. 95). After considering the parties' arguments, the court grants defendants' Motion for Summary Judgment. The court explains this ruling, below.

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I. Summary Judgment Facts^[1]

Defendant Pioneer Ridge Nursing is an assisted living nursing facility in Lawrence, Kansas. Pioneer Ridge Nursing hired plaintiff as a Licensed Practical Nurse around January 2, 2006. Doc. 77 at 2 (Pretrial Order ¶ 2.a.1.).

Pioneer Ridge Nursing and Midwest Health

Plaintiff's employment was terminated by her employer on February 22, 2018. Doc. 77 at 3 (Pretrial Order ¶ 2.a.11.). Plaintiff filed her first Complaint on June 22, 2019. Doc. 1. It named “Midwest Health, Inc. d/b/a Pioneer Ridge Health and Rehabilitation” as the only defendant. Id. Plaintiff added Pioneer Ridge Nursing as a defendant in the Third Amended Complaint, filed September 10, 2020. Doc. 61.

In February 2020, Midwest Health informed plaintiff, via letter, that she had sued the wrong entity; that plaintiff's employer was “Pioneer Ridge Nursing Facility-not Midwest Health”. Doc. 93-7 at 2. In June 2020, Midwest Health answered plaintiff's interrogatories. Doc. 93-9. In these answers, Midwest Health referred to plaintiff's employer as “Pioneer Ridge” and “Pioneer Ridge Nursing Facility.” Id. at 3, 4, 6. The Kansas Business Entity Search does not list any entities named “Pioneer Ridge Nursing Facility” or “Pioneer Ridge, ” the names Midwest Health had provided. Doc. 93-8. It is uncontroverted that Midwest Health served its answers to these interrogatories 63 days late. Doc. 93 at 16; Doc. 95 at 10.

On July 28, 2020, plaintiff deposed Ms. Jennifer Sourk, Midwest Health's designated corporate representative. Doc. 93-5 at 2. During her deposition, Ms. Sourk clarified that

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plaintiff was employed by “Pioneer Ridge Nursing Facility Operations, LLC”. Id. at 4 (Sourk Dep. 23:11-13). After deposing Ms. Sourk, plaintiff moved for leave to amend her Complaint. Doc. 49. United States Magistrate Judge Angela D. Mitchell, in her Order granting Plaintiff's Motion for Leave to File a Third Amended Complaint, found that plaintiff “did not receive accurate information as to the specific business entity that Midwest Health contends is her true employer until July 28 . . . .” Doc. 55 at 5. So, the court granted leave for plaintiff to amend her Complaint to name Pioneer Ridge Nursing as a defendant. And, plaintiff contends that both Pioneer Ridge Nursing and Midwest Health were her employer. Next, the court describes the relationship between defendant Midwest Health and defendant Pioneer Ridge Nursing.

In 2010, Midwest Health and Pioneer Ridge Nursing entered a “Management Agreement.” Doc. 93-11. This Management Agreement was in effect when plaintiff's employment terminated. Doc. 93-5 at 11 (Sourk Dep. 67:17-19). Under the Management Agreement, Midwest Health provides “specialized services” to Pioneer Ridge Nursing, specifically: financing, accounts receivable, accounts payable, requisition of supplies, maintenance, financial reports, income tax returns, developer services, legal services, and “fringe benefits.” Doc. 93-11 at 2-6. The Management Agreement provides a “not all-inclusive” list of “fringe benefits, ” they include: “personnel services, counseling, health insurance, retirement benefits[, ] and other possible qualified benefits for [Pioneer Ridge Nursing's] employees.” Id. at 6.

The Management Agreement explicitly provides that Midwest Health and Pioneer Ridge Nursing “both . . . have an interest in insuring that the two companies are viewed as separate and distinct entities” and imposes on both “an affirmative duty to correct any misunderstanding known to it that any other party believes the two parties to be the same or a related entity.” Doc.

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93-11 at 7-8. The Management Agreement specifies that Midwest Health and Pioneer Ridge Nursing “shall at all times maintain that they are separate and distinct legal entities.” Id.

Beyond the Management Agreement, there is some relationship between Midwest Health and Pioneer Ridge Nursing. James A. Klausman signed the Management Agreement on behalf of both Midwest Health and Pioneer Ridge Nursing. Id. at 9; Doc. 93-5 at 8-9 (Sourk Dep. 62:17-63:7); Doc. 94-6 (Klausman Dep. 9:3-17). Modification and performance of the Management Agreement is subject to James A. Klausman's sole discretion. Doc. 94-6 at 4-5 (Klausman Dep. 22:23-23:2). James A. Klausman is a shareholder of Midwest Health. Doc. 93-5 at 9 (Sourk Dep. 63:8-11). Pioneer Ridge Nursing is owned by Clayton Enterprises, LLC. Id. (Sourk Dep. 63:15-19). In turn, Clayton Enterprises, LLC is owned by the Trust of James Brett Klausman, the Trust of Michael Klausman, the Trust of Jamie Eaton, and the Trust of Floyd C. Eaton, III. Id. (Sourk Dep. 63:20-24). James B. Klausman is James A. Klausman's son. Id. at 9-10 (Sourk Dep. 63:25-64:2). Michael Klausman is James A. Klausman's son. Id. at 10 (Sourk Dep. 64:3-6). Floyd C. Eaton, Jr. is an officer of Pioneer Ridge Nursing and a shareholder of Midwest Health. Id. (Sourk Dep. 64:7-16).

Also, Midwest Health helped Pioneer Ridge Nursing with certain tasks. Pioneer Ridge Nursing's promotional materials advertise that Pioneer Ridge Nursing is a “Proud Member of Midwest Health Family of Communities[.]” Doc. 93-14 at 2. On August 12, 2020, on its Facebook page, Midwest Health posted jobs available at “Pioneer Ridge Health & Rehab.” Doc. 93-17 at 2. Midwest Health “staff members” were available for “consultation” if a Pioneer Ridge Nursing “supervisor or . . . administrator” had questions about human resources. Doc. 93-5 at 12 (Sourk Dep. 88:10-19). Midwest Health consults with Pioneer Ridge Nursing on its

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employee handbook but does not provide the exact handbook it uses.^[2] Doc. 93-5 at 3 (Sourk Dep. 18:1-23). Midwest Health does not participate in Pioneer Ridge Nursing's hiring and firing decisions. Doc. 93-5 at 12 (Sourk Dep. 88:10-19). C. Marie Vogel, Midwest Health's Vice President of Skilled Nursing Facilities, is involved in hiring decisions “if administrators have questions on qualifications.” Doc. 93-6 at 3, 5 (Vogel Dep. 12:19-24, 93:9-24). Otherwise, Ms. Vogel is not routinely involved with hiring. Id. at 5 (Vogel Dep. 93:21-24). Midwest Health provides a consultant who is available to facilities “to support the facility though the [on-site] survey process” by state regulators. Doc. 93-6 at 4 (Vogel Dep. 18:2-14).

Plaintiff, Pioneer Ridge, and Midwest Health

Next, the court examines plaintiff's relationship with Pioneer Ridge Nursing and Midwest Health during her employment. Plaintiff worked at the Pioneer Ridge Nursing facilities. Doc. 80-3 (Pl.'s Dep. 41:3-10). Pioneer Ridge Nursing employees supervised plaintiff. Doc. 80-3 at 4-5 (Pl.'s Dep. 44:2-45:1). Pioneer Ridge Nursing controlled plaintiff's staffing (Doc. 81-2), performance reviews (Doc. 80-3 at 6-7 (Pl.'s Dep. 46:8-47:1)), time-off

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and scheduling (Doc. 81-3; Doc. 80-3 at 8 (Pl.'s Dep. 50:18-22)), discipline (Doc. 81-4; Doc. 81-13), and termination (Doc. 81-7; Doc. 80-3 at 6 (Pl.'s Dep. 46:4-7)).

Pioneer Ridge Nursing paid plaintiff using Midwest Health's address.^[3] Additionally, plaintiff's tax documents list “Pioneer Ridge Nursing” as her employer. Doc. 81-6. Midwest Health made direct deposits into plaintiff's credit union account designated “ACH MWHICPOOLED.” Doc. 93-15 2-4.

Sometimes, plaintiff interacted with Midwest Health directly. Midwest Health, Inc. provided plaintiff with health insurance coverage within a “Midwest Health Management, Inc.” group. Doc. 93-5 at 5-6 (Sourk Dep. 27:16-28:17); Doc. 93-16. Midwest Health provided continuing nursing education to plaintiff. Doc. 93-18.

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Discrimination Against Plaintiff

When plaintiff was terminated, Ann Bell was Administrator of Pioneer Ridge Nursing. Doc. 77 at 3 (Pretrial Order ¶ 2.a.4.). Plaintiff spoke to Ms. Bell twice-once at the end of 2016 or the beginning of 2017 and once in October 2017-about her feelings that she was being treated unfairly. Doc. 80-3 at 11 (Pl.'s Dep. 58:3-11). Plaintiff was frustrated by the unfair treatment of Kathleen King-Alvoid. Id. (Pl.'s Dep. 58:12-25). Ms. King-Alvoid was Director of Nursing at Pioneer Ridge Nursing when plaintiff's employment was terminated. Doc. 77 at 2 (Pretrial Order ¶ 2.a.3.). Ms. King-Alvoid is “African American.”^[4] Doc. 80-6 at 4 (King-Alvoid Dep. 155:3-5). Ms. Bell is Caucasian. Doc. 80-5 at 17 (Bell Dep. 254:6-10).

In her first conversation with Ms. Bell, plaintiff complained that she was questioned about her job performance while other nurses made errors, other nurses were insubordinate, and plaintiff was reprimanded for eating a cookie at the nurse's station while another nurse...