United States District Court, N.D. Illinois, Eastern Division
SANDRA A. HEISE, Plaintiff,
CANON SOLUTIONS AMERICA, INC., Defendant.
MEMORANDUM OPINION AND ORDER
MATTHEW F. KENNELLY UNITED STATES DISTRICT JUDGE
Heise has sued her former employer, Canon Solutions America,
Inc. (Canon), alleging discrimination, unequal pay, and
retaliation in violation of Title VII of the Civil Rights Act
of 1964 and unequal pay and retaliation in violation of
federal and state equal-pay statutes. Canon has moved for
summary judgment on all of Heise's claims, and Heise has
cross-moved for summary judgment on her equal pay claims. For
the reasons stated below, the Court grants summary judgment
in favor of Canon on the retaliation claims and the Title VII
termination claim but denies both sides' motions for
summary judgment with respect to the state and federal Equal
Pay Act and Title VII compensation claims.
following facts are taken from the parties' Local Rule
56.1 submissions, and they are undisputed unless otherwise
Heise's original employer, Ambassador Business Solutions,
became part of Canon Business Solutions after a series of
reorganizations and mergers, and Canon Business Solutions, in
turn, merged with Océ North America and Océ
Imagistics (Océ) to form Canon Solutions America.
Throughout this opinion, the Court will refer to Heise's
employer as Canon. Canon sells and services a wide range of
imaging, printing, and copying equipment.
Canon hired Heise as a sales manager in 2000, she had already
had three years of industry experience from working in sales
and marketing at Minolta. In February 2001, Heise was
promoted from the position of sales manager to manager of
named accounts. In January 2004, Peter Kowalczuk promoted
Heise to the position of branch sales director for the
Chicago Branch. When he promoted Heise to the branch sales
director position in 2004, Kowalczuk tapped Doug Reuter to
fill Heise's former position. Although Heise was only
making $59, 000 in that role at the time of her promotion,
Kowalczuk offered Reuter a starting salary of $70,
comparison, Heise's starting salary in her new role as
the branch sales director was $80, 000. Heise contends that
when she found out about Reuter's offer, she complained
to Kowalczuk that it "would be unfair to pay [her]
replacement far more than Canon ever paid [her] to do the job
and only $10, 000 less than it was paying [her] to run the
entire branch." Pl.'s SOF, Ex. 3 (Heise Decl.)
¶ 5. Kowalczuk testified during his deposition that he
did not remember Heise objecting to these salary differences.
See Pl.'s SOF, Ex. 4 (Kowalczuk Dep.)
199:4-200:7. Kowalczuk testified that he offered Reuter the
$70, 000 salary because he had been with the company for over
fifteen years at the time of his promotion, had a "long
track record" as a "highly successful"
salesperson, and was going to be taking a "heavy
discount in total compensation" in his new role when the
variable compensation he received as a sales representative
was taken into account. Id. 197:23-198:5.
end of 2006, two years after Heise's promotion to the
Chicago branch sales director position, Canon posted a newly
created position for a regional director, who would oversee
the downtown and suburban Chicago sales branches, which
included offices in Downers Grove and Schaumburg. Heise
applied for the job, but Kowalczuk chose to hire Armand
Lanera instead. Kowalczuk selected Lanera for the regional
director position in 2006 despite (1) having received
complaints years earlier about his inappropriate behavior
toward women while he was the branch sales director for the
Schaumburg office and (2) having placed him on a corrective
action plan in May 2003 based on the Schaumburg branch's
"poor performance" and concerns about Lanera's
leadership. Pl.'s SOF, Ex. 9 at CSA00002144. Kowalczuk
testified during his deposition that he gave the position to
Lanera because he had more industry experience.
clashed with Heise after his promotion to regional director.
In August 2007, Heise complained to Kowalczuk that Lanera
told her he planned to demote her. According to Heise,
Kowalczuk told her she was being a "silly girl" and
that Lanera would not have said such a thing. Heise Decl.
¶ 17. In October 2007, Lanera placed her on a corrective
action plan-an action that Heise believed was unjustified.
The following month, Heise complained to HR about her
problems with Lanera and her concern that Kowalczuk treated
women differently from men. In March 2008, Lanera took Heise
off the corrective action plan.
2009, Canon began to organize its sales force by zone.
Heise's branch fell within the Central Zone. From 2009
through 2012, the Central Zone comprised three regions: the
Chicago Region, the Southwest Region, and the Midwest Region.
As part of the 2009 restructuring, Canon created two new
regional sales vice president positions within the Central
Zone, one for the Midwest Region and one for the Southwest
Region. These vice presidents of sales reported to Kowalczuk,
who was the vice president of sales for the entire Central
Zone. Canon hired Dan Verley as the new regional sales vice
president for the Midwest Region at a starting salary of
$175, 000, and it hired Dusty Peck as the regional sales vice
president for the Southwest Region at a starting salary of
$145, 000. Canon did not post either of the openings. Heise
says that Kowalczuk told her she needed more experience as a
branch sales director before she would be ready for regional
management. See Heise Decl. ¶ 22.
2010, Verley became the regional sales vice president for the
Chicago Region. Once again, Canon did not post the position.
Around this time, Canon reclassified the regional sales vice
president positions as regional senior director of sales
positions.When Heise discovered that Canon had given
Verley this position, she complained to Kowalczuk. Kowalczuk
testified during his deposition that he understood at the
time he transferred Verley to the Chicago regional management
position that Heise was interested in a promotion but he did
not promote her because "[s]he did not have the
experience of running multiple branches" and a major
account team. Kowalczuk Dep. 92:11-92:24.
Verley's transfer to the Chicago Region, the senior
director of sales position for the Midwest Region opened up
in early 2010. Canon did not post the opening; instead,
Kowalczuk promoted Mark Messner, who had been working for
Canon for less than a year as the Detroit branch sales
director. Kowalczuk testified that he offered the job to
Messner because he had a lot of prior industry experience,
had proven himself in a short time, and had deep roots in
2010, Messner resigned. Heise states that she asked Kowalczuk
to tap her as Messner's replacement, just as he had
tapped Messner and Verley for their regional management
positions, but Kowalczuk posted the position, so she had to
compete for it. Nonetheless, in September 2010, Kowalczuk
selected Heise for the Midwest Region senior sales director
position. On September 15, 2010, Kowalczuk sent an e-mail to
Jayme Arendt, then the director of human resources for the
Central Zone, asking her to forward Messner's offer
letter to him. In her response, Arendt stated the following:
offer was for 140k, the original is attached.
For a reference point -
Peck - 150, 927
Verley - 178, 461
entirely different experience levels, which you already know.
Def.'s Statement of Facts (Def.'s SOF), Ex. W. That
same day, Kowalczuk sent an email to Arendt and Canon's
vice president of human resources, Nelson Remetz, with
Heise's draft $140, 000 offer. He stated, "I want to
be careful that the offer is in line with the other Sr
Directors since Sandra would be the only woman in this
role." Def.'s SOF, Ex. X at CSA00211351.
approved the proposed $140, 000 starting salary for Heise, as
did Canon's president Tod Pike. Kowalczuk offered Heise a
starting salary of $140, 000 and four months of guaranteed
bonus income. Heise countered by asking for $150, 000 and six
months' guaranteed bonus income. Kowalczuk refused
Heise's request for a higher starting salary. In a
September 28 e-mail, Kowalczuk assured Heise, "The
salary is not at the minimum as you thought yesterday it is
above the medium [sic] and its is [sic] ¶ 34% increase
over current which is why the offer took so long to get
approved by CUSA (it is above the standard as we
discussed)." Def.'s SOF, Ex. T at CSA00300487. On
September 29, Heise accepted the final offer of $140, 000 and
seven months of guaranteed bonus income. Messner's $140,
000 offer, by contrast, did not include any income guarantee.
time Heise accepted the offer, $140, 000 was the lowest
salary being paid to any regional senior director of sales.
As of April 2010, the median salary for Canon's eight
regional managers was $159, 548. And according to Canon's
own confidential pay tables for 2009, although the minimum
salary for someone in the relevant pay band (E3) was $125,
300, the median salary ("midpoint" salary) was
$172, 055. See Pl.'s SOF, Ex. 25 at CSA01083310.
Canon's Rule 30(b)(6) deponent, Juanita Nash-Dahlen, the
HR director of employee relations and compliance, testified
that the criteria the company used to set the starting salary
of regional managers included: (1) job knowledge, (2)
industry experience, (3) tenure with Canon, (4) product
knowledge, (5) business acumen, (6) sales skill, (7) people
skills, (8) prior job performance, and (9) prior salary. Both
Kowalczuk and Arendt have stated that, at the time Heise was
promoted to regional senior director of sales, they believed
both Peck and Verley had much more experience than
See dkt. no. 134-46 (Kowalczuk Decl.) ¶ 20;
dkt. no. 134-43 (Arendt. Decl.) ¶ 10.
had never hired a female regional manager prior to Heise, and
he has not had one since. Heise testified during her
deposition that when she was promoted to the position,
Kowalczuk told her that he had concerns about a single woman
traveling in the marketplace and that his wife encouraged him
to "give her a chance." See dkt. no.
134-51 (Heise Dep.) 182:16-182:20. Kowalczuk, for his part,
testified that he did not recall expressing concern about
women traveling alone and that he does not and did not have
any such concerns. He also testified that he did not believe
he told Heise that his wife told him to give her a chance.
Heise began as senior director of sales for the Midwest
Region in 2010, the region had five branches, thirteen sales
teams, and an annual sales quota of $27.9 million. The
Southwest Region managed by Peck consisted of three branches
and ten sales teams and had an annual quota of $25.4 million
in 2010. Nonetheless, as previously mentioned, Peck was paid
more than Heise. In January 2011, Heise received a salary
increase of $5, 000 as part of the standardization of senior
director incentives, but she remained the lowest paid
regional manager at Canon.
early 2012, Heise learned from Peck that she was paid less
than both Peck and Verley. Heise contends that she complained
to Arendt that she thought she was being paid unfairly as the
only woman in regional management. See Heise Decl.
¶ 41. Arendt testified during her deposition that she
recalled Heise coming to her with the concern that her base
salary was low. In response, Arendt testified that she
"looked at [Heise's] experience, her resume, and her
background," looked at the salary range, "looked at
the former offer of the employee who held the same role
previously, and . . . looked at her peers and their
experience level." Pl.'s SOF, Ex. 75 (Arendt Dep.)
170:14-170:20. When asked why she believed Peck's higher
salary was justified, Arendt stated that it was because he
ran a dealership prior to joining Canon, was in a larger
market, and had more years of senior director-level
experience. Ultimately, Arendt told Heise that she "did
not believe [Heise's] salary to be low based on her
experience and time in her job." Id.
170:21-170:22. Arendt also testified that she spoke to
Kowalczuk about Heise's concerns and her conclusion that
Heise's salary was appropriate. Canon did not increase
Heise's salary at that time.
to late-2012, Kowalczuk and the rest of the Canon management
team began the process of restructuring the Central Zone to
integrate personnel from Océ, which Canon had recently
acquired, into Canon's sales force. Ultimately, Canon
reorganized the Central Zone into four regions: the Midwest
Region, the Greater Chicago Region, the Southwest Region, and
the Ohio Valley Region. Jim Stocker, from Océ, became
the senior director of sales for the new Ohio Valley Region.
Stocker's starting salary in this role was just over
$133, 000, which is what he had been making at Océ. As
part of this reorganization, Canon shifted two branches,
Milwaukee and St. Louis, into Heise's region. Milwaukee
had been Verley's worst performing branch in 2012, and
St. Louis had been Peck's worst performing branch in
2012. Around the same time Canon announced these changes,
Kowalczuk became the national head of sales. He selected
Verley to fill his former position without posting it. Steve
Greiman, who was previously a vice president at Océ,
took over Verley's position as senior director of sales
for the Chicago region.
did not receive a year-end performance review from Kowalczuk
for 2012. Canon has produced a draft 2012 performance review
for Heise that is labeled "Cancelled/Archived" and
"Not Submitted." Pl.'s SOF, Ex. 40 at EEOC 153.
This cancelled review, which appears to have been authored by
Kowalczuk but is not signed, describes Heise as a
"Marginal Performer" overall. Id. at EEOC
159. Both Peck and Verley received 2012 performance reviews
from Kowalczuk; he rated Peck as a "Successful
Contributor" and Verley as a "High
Contributor." Pl.'s SOF, Ex. 38 at CSA00002208;
Pl.'s SOF, Ex. 37 at CSA00001554. Kowalczuk gave Peck a
merit increase in salary for 2012, but he did not give one to
beginning of 2013, Heise once again began reporting to
Verley. According to Heise, from January to April 2013,
Verley undermined her and treated her disrespectfully in
front of subordinates and peers. For example, Heise alleges
that Verley entered her office while she was on a conference
call with her branch directors and screamed at her for using
the speaker on her iPhone rather than the landline. Heise
contends that Verley did not behave the same way toward the
male regional managers; Canon has submitted declarations from
current and former employees that say Verley treated male
employees the same way. See dkt. no. 134-44 (Dillon
Decl.) ¶ 9; dkt. no. 134-45 (Farrow Decl.) ¶ 5.
April 2013, Heise complained to Arendt about Verley's
behavior toward her and told Arendt that she was considering
taking a leave of absence. Heise contends that she
"explained in detail how Mr. Verley was harassing [her],
specifically using the word harassment, and made it clear
[she] believed he was treating [her] that way because [she]
was a woman." Heise Decl. ¶ 59. She has also stated
that she told Arendt she was concerned that Verley would
retaliate against her and that she still did not believe she
was being paid fairly in relation to the male regional
managers. Arendt testified during her deposition that
although Heise complained about Verley yelling at her, she
"never claimed to me hostile work environment, or
harassment, or discrimination." Arendt Dep. 163:2-163:7.
Accordingly, Arendt never told Verley or Kowalczuk that Heise
had complained of discrimination or harassment. Kowalczuk has
stated that, "[o]ther than her issues with Mr. Lanera
which happened years before, [he] had no knowledge that Ms.
Heise had any concern or complaint about harassment or
discrimination until she made such allegations after her
employment had ended." Kowalczuk Decl. ¶ 31.
to Heise, Verley's treatment of her worsened after she
made the complaint. Based on the perceived change in
Verley's behavior-and the fact that Heise believed Arendt
and Verley were having an affair based on statements Arendt made to
her the previous fall-Heise believes that Arendt had informed
Verley of her complaints. Around August 2013, Heise
confronted Verley about sharing certain information with one
of her branch sales directors about potential changes to the
branch without informing her first. According to Heise,
Verley angrily responded, "None of my guys act the way
you do." Heise Decl. ¶ 58. Verley testified that he
did not remember using those words, but he did remember the
conversation and believed that Heise "took an unusual
amount of offense" to a situation that happens
frequently. Pl.'s SOF, Ex. 15 (Verley Dep.) 229:1-231:11.
December 27, 2013, Verley informed Heise that she was
terminated, effective immediately. She was escorted out of
the building after being given an opportunity to gather her
testified during his deposition that Canon did not terminate
Heise for performance reasons. Canon contends that after
losing a substantial amount of money in 2013, the company
determined that it needed to cut costs and increase
profitability. According to Canon, it made the decision to
terminate Heise, along with Jim Blair, the senior director of
service for the Midwest Region, as part of a restructuring of
the Central Zone regions. Specifically, Canon reduced the
number of regions within the Central Zone from four to three
by folding the branches that made up the Midwest Region into
the remaining regions and eliminating the Midwest Region
sales and service management positions. At this time, the
regional senior directors for the Central Zone were:
• Sandra Heise (Midwest Region)
• Steve Greiman (Greater Chicago Region)
• Jim Stocker (Ohio Valley Region)
• Dusty Peck (Southwest Region)
to Canon, the idea to collapse the Midwest Region into the
other regions originated with Steven Lukaszewski, who goes by
Steve Lukas. Lukas was the vice president of service for the
Central Zone (Verley's counterpart) during this time.
After Lukas discussed the idea with Verley and Arendt, Lukas
and Verley raised the idea with their respective bosses,
Kowalczuk and Art McGinn, Canon's national head of
service. As early as September 20, 2013, Arendt was
considering the cost of severance for Heise and Blair if
their positions were eliminated as part of ...