An Employer's Offer of a "Big Bonus" to an Employee to Date a Wealthy Client Can Constitute Quid Pro Quo Sexual Harassment...But It Must Be Established that the Employee Was Actually Entitled to the Bonus

Davenport v. Edward D. Jones & Company, L.P. - Fifth Circuit Court of Appeals

Facts:  Tyanne Davenport ("Davenport") worked at Edward D. Jones & Company, L.P. ("Edward Jones") as a Branch Office Administrator starting in October of 2014.  Davenport was hired by Coyne (no first name was given in the Court's opinion) and was alleged to have created a hostile work environment.  Despite Coyne's conduct, in March of 2015, he conducted a review of Davenport's work, noted she was "exceeding expectations" and approved a $400 bonus.

In September of 2015, after learning a wealthy client was interested in dating Davenport, Coyne said Davenport should take the client in exchange for a big bonus.  Although Davenport declined, Coyne repeated the offer approximately three times within thirty days.  On October 1, 2015, Coyne completed Davenport's annual review and rated Davenport as "exceeding expectations" and recommended she receive a 4% salary increase.  No bonus was awarded.  Later that month, at a meeting between Coyne, Davenport, the wealthy client, and another Edward Jones financial advisor, Davenport suggested the wealthy client's account Coyne's office.  Coyne then suggested to Davenport that "maybe we can get some nudie pictures of you...that might entice him."  The next day, Davenport reported the comment to the district manager, and after an investigation into Coyne's management practices, Davenport was granted an extended leave of absence.

In November of 2015, Davenport filed a charge of employment discrimination with the Equal Employment Opportunity Commission ("EEOC").  In the charge, Davenport described the "nudie picture" incident and the leave of absence.  A therapist subsequently advised Edward Jones that Davenport could not return to work with Coyne due to emotional trauma stemming from Coyne's behavior.  After being denied a request to transfer to a full time position at another Edward Jones office, Davenport resigned on January 19, 2016.  Edward Jones sent Davenport two letters regarding employment options but Davenport declined to pursue either option.

Davenport proceeded to file suit against Edward Jones and alleged quid pro quo and hostile work environment sexual harassment claims under Title VII of the Civil Rights Act of 1964 as well as state law claims of sexual discrimination, defamation, and false light invasion of privacy.  The district court subsequently granted summary judgment in favor of Edward Jones as to all causes of action.  Davenport filed the present appeal.

Holding:  (Note, this case brief only analyzes the Court's analysis of Davenport's bonus quid pro quo claim).

The Court of Appeals acknowledged that Davenport contended the district court improperly dismissed her claim because it failed to credit her uncontroverted deposition testimony that Coyne promised her "big bonuses" if she dated the wealthy client.  At the summary judgment stage, Davenport was required to produce evidence in which a reasonable jury would find (1) that she suffered a "tangible employment action" and (2) that the action was causally related to the acceptance or rejection of Coyne's sexual harassment.  Assuming Davenport could satisfy these two requirements, she would be able to establish that her employer was vicariously liable per se.

The Supreme Court has previously defined a "tangible employment action" as "a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different responsibilities, or a decision causing a significant change in benefits."  As a result, denial of a raise or bonus have been found to be a tangible employment action.

In this case, Edward Jones argued that Davenport's claim could not proceed because she failed to allege that the bonus was conditioned upon her acquiescence to advances from Coyne.  Instead, Edward Jones contended that because Davenport only alleged the bonuses were conditional upon dating a third party, the quid pro quo claim could not proceed.  The Court was unmoved, however, and held that it was of no consequence that a third party was to be the beneficiary of the sexual harassment.  As a result of Coyne making the requests, he engaged in the sexual harassment.

Edward Jones also argued that Davenport's claims could not proceed because she could not identify any explicit sexual advances, only to requests that she date the wealthy client.  However, the Court again disagreed and noted that the caselaw only required the tangible employment benefit be contingent upon the acceptance or rejection of the "supervisor's sexual harassment" which includes "[u]nwelcome[] sexual advances, requests for sexual favors, or other verbal or physical conduct of a sexual nature."  Coyne's repeated requests that Davenport date the wealthy client (coupled with the testimony about the nudie picture incident) was evidence that Coyne's conduct was sexual in nature and could give rise to a quid pro quo sexual harassment claim.

The Court turned to the final argument from Edward Jones that Davenport could not prevail on her claim as she could not produce evidence that she was denied a bonus for refusing to date the wealthy client.  While Davenport knew that Coyne could influence bonus decisions through the company's review process, Davenport had failed to produce evidence of Edward Jones's bonus structure nor evidence that she was scheduled to receive a bonus in October of 2015 simply because she received another "exceeds expectations" rating.  As well, Davenport failed to establish that Coyne argued for or against her receiving a bonus at that time.  Consequently, because Davenport had not produced any summary judgment evidence that Coyne and Edward Jones denied her a bonus because she refused to date the wealthy client, her claim could not proceed.

Judgment:  The Court of Appeals affirmed the district court's granting of summary judgment in favor of the employer on the grounds that the employee had failed to produce summary judgment evidence that she was actually entitled to a bonus when she claimed her employer committed quid pro quo sexual harassment when it allegedly denied her a bonus when she refused to date the employer's wealthy client.

The Takeaway:  For those looking for a well written opinion on the entire scope of the causes of action alleged by Davenport, the Court's full opinion on this matter is worth a review.  In this instance, I chose to highlight just one section of the Court's opinion as I think it was highly relevant and parsed some of the nuances of quid pro quo sexual harassment well.  Bear in mind, the Fifth Circuit Court of Appeals acknowledged that quid pro quo sexual harassment is actionable when an employer promises an employee a "big bonus" to date a customer/client.  However, as the Court noted in this case, it must be shown that the employee was actually entitled to the bonus in the first place.

I point readers in particular to the Court's finding that Davenport had not produced summary judgment evidence to establish that her bonus was denied because she refused to date the wealthy client.  Remember, the Court of Appeals can only consider the testimony and evidence in the record on appeal.  No new evidence is presented at this stage of litigation, so the Court cannot look outside the record.  Based upon what had been plead and introduced at the district court level, I think the Court of Appeals was correct to find that Davenport failed to establish a link between Coyne and Edward Jones denying a bonus correlated with her refusal to date the wealthy client.  Without summary judgment evidence to establish this vital link, namely that she was entitled to a bonus, Davenport simply had no avenue to proceed with her quid pro quo claim.

Majority Opinion Judge:  Senior Circuit Judge Davis

Date:  May 16, 2018

Opinion: http://www.ca5.uscourts.gov/opinions/pub/17/17-30388-CV0.pdf