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Benders v. Bellows and Bellows

February 12, 2008

EVELYN BENDERS, PLAINTIFF-APPELLANT,
v.
BELLOWS AND BELLOWS, DEFENDANT-APPELLEE.



Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. Nos. 04 C 7326 & 06 C 324-Samuel Der-Yeghiayan, Judge.

The opinion of the court was delivered by: Evans, Circuit Judge.

ARGUED OCTOBER 22, 2007

Before EASTERBROOK, Chief Judge, and KANNE and EVANS, Circuit Judges.

The plaintiff, Evelyn Benders, alleges that she was fired in April 2004 in retaliation for filing an age and race discrimination claim with the Equal Employment Opportunity Commission (EEOC) and for threatening to report a dispute about her employment status to the IRS. The defendant law firm, Bellows and Bellows, P.C. (B&B),*fn1 maintains that it terminated Benders' employment in May 2003, well before she engaged in any protected activities. The twist in this case is that B&B's decision to fire Benders was communicated to her in rather uncertain terms by the firm's owner and president, Joel Bellows, who, despite his marriage to Laurel Bellows (the other "B" of B&B), had a romantic relationship with Benders during the first several years of her employment.

Notwithstanding these and other complexities, the district court found, as a matter of law, that B&B fired Benders on the earlier date. Consequently, the court granted B&B's motion for summary judgment on all three counts in the complaint. Benders v. Bellows and Bellows, No. 04 C 7326, 2006 WL 208713 (N.D. Ill. Jan. 24, 2006). The case*fn2 is now before us on Benders' appeal.

As we must, we accept Ms. Benders' allegations as true at this stage of the proceedings. As so viewed, the facts are that B&B hired Benders, an African-American woman now in her fifties, as a legal secretary in 1996 and promoted her to the position of office administrator about a year later. In that position, Benders took charge of the firm's computer system, invoicing, and personnel matters, including the hiring, firing, and training of employees. Benders, during all this time, did not have an employment contract with B&B.

Shortly after starting at the firm, Benders and Mr. Bellows began a romantic relationship, which ended about 5 years later. From time to time during this period, Mr. Bellows helped Benders financially, issuing her checks, drawn on the firm, to purchase various personal items. B&B maintained a record of the monies given to Benders, which she considered gifts, not loans or income. B&B, on the other hand, claims that these monies were not gifts. It issued 1099 IRS forms to Benders for 2002 and 2003 reflecting that these payments were income.

In May 2003, Mr. Bellows had a private conversation with Benders in which he told her that his wife and another principal of the firm, Nick Iavarone, were "campaigning to get [Benders] out" and that she should begin to look for other employment. Benders alleges that Mr. Bellows assured her that she would remain employed with the firm until she found "the right job." Benders suspected that the real reason for her future departure was that B&B did not want an older black woman around after it moved into its new offices. According to the firm, however, the decision to fire Benders was made because Mrs. Bellows did not believe Benders was competent as office administrator. B&B maintains that Mr. Bellows offered to keep Benders on the payroll as an act of generosity until she found another job.

Benders claims that, a few weeks later, Mr. Bellows told her that the firm had hired a "moving consultant," who would "share some of the responsibilities" with Benders, but that "no one would be the wiser." In July 2003, Cinthia LeGrand, a white woman approximately 10 years younger than Benders, began her employment at B&B. After LeGrand's arrival, Benders' duties at the firm generally diminished. According to Benders, however, at times, her responsibilities would "come back," causing her to question her role at B&B. B&B concedes that it never stripped Benders of her title as office administrator, nor did it ever reduce her then-current salary until her last day at the firm, about 9 months after LeGrand started.

In December 2003, Mr. Bellows approached Benders and proposed that, instead of making a contribution to the firm's 401(k) plan on her behalf for 2003, he would assume responsibility for a civil judgment entered against Benders regarding her student loans. Mr. Bellows allegedly explained to Benders that, to effectuate this arrangement, he would have to reclassify her as an independent contractor for the last few weeks of 2003. Benders admits that she agreed to forego the payment, but only on the condition that she be returned to employee status by mid-January 2004. From that point on, however, Benders' paychecks bore the notation, "independent contractor." Despite the change in status, B&B concedes that it continued to deduct federal taxes from Benders' paycheck.

In February 2004, in response to her complaints, Mr. Bellows told Benders that he was going to put her back on the payroll long enough for her to collect unemployment, for approximately 5 weeks, and then she would have to leave the firm. But Benders' paychecks remained the same. Benders was never asked to sign an independent contractor agreement, which she knew to be the firm's practice.

Later that month, Benders filed a claim with the Illinois EEOC, alleging race and age discrimination in connection with her apparent demotion and B&B's hiring of LeGrand. Her charge appended e-mails written by Mr. Bellows. One of the e-mails referred to Benders as "Seabiscuit" who "should have been put down" long ago. In another e-mail, Mr. Bellows said that African-American members of his staff were making Benders' employment situation "a racial thing." After Benders filed the charge, she claims that Mr. Bellows became increasingly hostile towards her and made her working conditions difficult.

According to B&B, however, it was Benders who caused problems. The firm claims that she became disruptive and insubordinate, did not actively seek other employment, deliberately caused problems for LeGrand, and did not perform certain duties.

On April 12, 2004, B&B filed its position statement with the EEOC. Benders alleges that, 3 days later, Mr. Bellows approached her and told her that because she had filed an "awful EEOC charge," he would not consider paying her severance. B&B denies that Mr. Bellows made any such statement.

On April 14, 2004, after receiving another "independent contractor" paycheck, Benders reminded Mr. Bellows that she planned to refinance her home and needed her pay stub to reflect her current status as an employee. Mr. Bellows replied in an e-mail that he "had thought that [Benders] [was] being paid as an employee until recently" and promised to issue her a corrected check. He changed his mind, however, because Mrs. Bellows would not allow it. Four days later, Benders sent Mr. Bellows an e-mail telling him that ...


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