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BURDI v. UNIGLOBE CIHAK TRAVEL

July 1, 1996

GINA BURDI, Plaintiff,
v.
UNIGLOBE CIHAK TRAVEL, INC., EDWARD CIHAK, individually and in his capacity as owner and President of Uniglobe Cihak Travel, and UNIGLOBE MIDWEST REGION, Defendants.



The opinion of the court was delivered by: GRADY

 Plaintiff brings suit for alleged violations of 42 U.S.C. § 2000(e) ("Title VII"), including sexual harassment and sexual discrimination, and also asserts various Illinois state law claims. Defendants have moved to dismiss for lack of subject matter jurisdiction, pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure. For the reasons stated in this opinion, the motion is granted.

 BACKGROUND

 On approximately March 1, 1989, defendant Edward Cihak ("Cihak"), president of defendant Uniglobe Cihak Travel, Inc., a.k.a. Cihak World Travel, Inc. ("UCT"), entered into a franchise agreement with defendant UniGlobe Midwest Region, a.k.a. Uniglobe Travel (Midwest), Inc. ("Midwest"). Under the terms of that agreement, Midwest operates as the franchisor and UCT operates as the franchisee travel agency.

 On approximately January 31, 1992, plaintiff Gina Burdi ("Burdi") was hired by UCT to work as a Corporate Account Executive. According to the complaint, Cihak began touching Burdi and making sexual comments to her shortly after she began working at UCT. Throughout the term of Burdi's employment, Cihak regularly made derogatory and sexual comments to her and rubbed her leg.

 On one occasion, in June or July of 1994, Cihak called Burdi into his office, shut the door, pinned her arms to her sides by wrapping his arms around her, and forced his tongue into her mouth. Burdi wrestled out of Cihak's hold, ran out of the office, and told her co-workers what had happened. Later that day, Burdi called Midwest and reported the incident to Robert Stepien ("Stepien"), the Director of Training and Marketing. Stepien advised her to quit her job. A couple of days later, Stepien called Burdi at work to tell her that, because of its serious nature, he had to report her complaint to Robert Roe ("Roe"), president of Midwest. Burdi never heard anything further from anyone at Midwest regarding her sexual harassment complaint.

 Cihak continued to touch Burdi and make sexually explicit and derogatory remarks to her. At some point in January 1995 Cihak asked Burdi to come over to his house for dinner because his wife was out of town for the weekend. Burdi angrily declined the invitation. On March 9, 1995, Cihak terminated Burdi's employment, claiming that he could no longer afford her. Neither UCT nor Midwest employed more than ten employees during any month of 1994 or 1995.

 DISCUSSION

 When considering a Rule 12(b)(1) motion to dismiss for lack of subject matter jurisdiction, a district court accepts as true all well-pled factual allegations and draws reasonable inferences from the allegations in favor of the plaintiff. Capitol Leasing Co. v. FDIC, 999 F.2d 188, 191 (7th Cir. 1993). The court may also look beyond the allegations of the complaint and consider affidavits and other documentary evidence to determine whether subject matter jurisdiction exists. Id.

 Defendants have submitted copies of the quarterly unemployment tax contribution reports UCT and Midwest filed with the Illinois Department of Employment Security during the relevant calendar years of 1994 and 1995. These reports show that neither company employed fifteen or more employees during those years. Plaintiff acknowledges this but argues that under one or more of the theories of agency, joint employer, or single entity, the court may add the employee totals for the two companies together to produce a combined total greater than the fifteen employees required for subject matter jurisdiction. In their reply, defendants argue that these theories are inapplicable under the facts of this case, and, further, that even if the employees of the two companies were added together, they would still not add up to fifteen because some of the employees listed on the unemployment tax reports are part-time employees who do not work every day. The parties have not provided sufficient evidence regarding who worked when for the court to be able to determine whom to count and whom not to count, but we need not address that question because we agree with defendants that the theories argued by plaintiff for combining employees are not applicable to the facts.

 Before addressing plaintiff's arguments for combining the employee totals of UCT and Midwest, we note that plaintiff has made no allegations or offered any evidence that would permit us to exercise subject matter jurisdiction over Cihak in his individual capacity. The Seventh Circuit has recently held that Title VII's definition of employer, which "includes an employer's agents, is simply a statutory expression of traditional respondeat superior liability and imposes no individual liability on agents." Williams v. Banning, 72 F.3d 552, 555 (7th Cir. 1995); see also, AIC Security, 55 F.3d at 1279-80 (holding the same in the context of the Americans with Disabilities Act, which uses virtually the same definition of "employer" as Title VII). Agents are liable only if they independently meet the statutory definition of "employer" by, among other things, having fifteen employees. DeVito v. Chicago Park Dist., 83 F.3d 878, slip op. at 8 (7th Cir. 1996).

 These holdings not only require that the case be dismissed with respect to Cihak, they also mean that if plaintiff's agency rationale for exercising subject matter jurisdiction -- over two entities that are not statutory employers -- ever had any vitality in the Seventh Circuit, it has none now. Clearly, under the Seventh Circuit's interpretation of the statutory language, neither an agent nor its principal can be liable for a Title VII violation unless each is a statutory employer in and of itself when viewed separately from the other. Therefore, even if plaintiff could establish an agency relationship between UCT and Midwest, we would still lack subject matter jurisdiction.

 Plaintiff's joint employer theory is similarly flawed. The only case plaintiff cites in support of this theory is Magnuson v. Peak Technical Servs., 808 F. Supp. 500 (E.D. Va. 1992), but this case does not stand for the proposition that entities not meeting the statutory definition of "employer" can nevertheless become liable under Title VII by being combined with each other. Magnuson recognizes that more than one employer can be liable to an individual under Title VII if they each "'control some aspect of an individual's compensation, terms, conditions, or privileges of employment.'" Id. at 507-08 (quoting Spirt v. Teachers Ins. & Annuity Ass'n, 475 F. Supp. 1298, 1308 (S.D.N.Y. 1979)). Magnuson also recognizes, however, ...


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