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Craig v. Suburban Cablevision

July 13, 1995


On appeal from Superior Court, Appellate Division.

The opinion of the Court was delivered by Pollock, J. Chief Justice Wilentz and Justices Handler, O'Hern, Garibaldi, Stein and Coleman join in Justice Pollock's opinion.

The opinion of the court was delivered by: Pollock

(This syllabus is not part of the opinion of the Court. It has been prepared by the Office of the Clerk for the convenience of the reader. It has been neither reviewed nor approved by the Supreme Court. Please note that, in the interests of brevity, portions of any opinion may not have been summarized).


Argued February 27, 1995 -- Decided July 13, 1995

POLLOCK, J., writing for a unanimous Court.

The issue on appeal is whether William Craig, Ellen Chapman, William Denino, and Ellen Marsillo (plaintiffs) have standing to sue Suburban Cablevision, Inc., Frank DeJoy, Jane Bulman and Gregory Vandervort (defendants) for a retaliatory discharge in violation of the New Jersey Law Against Discrimination (LAD), specifically, N.J.S.A. 10:5-12(d) (section 12(d)). Under section 12(d), it is unlawful for an employer to take reprisals against any person who filed a complaint, testified or assisted in any proceeding under the LAD or who assisted or encouraged any other person in the exercise or enjoyment of any right granted or protected by the LAD.

Plaintiffs worked in the door-to-door sales department of Suburban Cablevision, Inc. (Suburban). Susan Chapman was the supervisor, and Ellen Chapman, Susan's mother, was her superior and the department manager. Ellen Marsillo is Susan's sister. William Craig and William Denino were Susan's close friends. Susan had filed a discrimination claim in federal court against Suburban, alleging that Suburban failed to consider her for a promotion because of her gender and physical handicap. The parties eventually settled that action.

Before settling Susan's federal court action, Suburban instituted a number of changes in the department that the employees considered harassing. As Susan's lawsuit progressed, Suburban allegedly escalated its harassment.

On July 14, 1989, Frank DeJoy, vice-president and general manager of Suburban, called a meeting with the department's sales staff. At that meeting, DeJoy announced that the door-to-door sales department would be closed for "economic reasons" and that all employees would be terminated effective August 18, 1989. Although Suburban offered the terminated employees an opportunity to apply for other positions in the company, it discouraged them from applying for those other positions. The personnel manager advised each employee that he or she would forfeit any severance pay if the employee applied for another company position. In addition, the offered positions were at lower salaries and without commissions. In light of those disincentives, none of the employees applied and the door-to-door sales employees lost their jobs, including plaintiffs.

Eighteen months after eliminating the door-to-door sales department, Suburban reinstituted door-to-door sales by subcontracting with Cable Television Marketing of America (CTMA), an independent sales marketing concern. Responding to newspaper advertisements placed by CTMA, Denino, Marsillo and Susan Chapman applied for positions at CTMA and were hired. When Suburban learned that CTMA had hired former Suburban employees, Suburban directed CTMA's manager to rescind the offers of employment. Because it did not want to jeopardize its contract with Suburban, CTMA retracted its offers to Denino, Marsillo and Susan Chapman.

On August 20, 1992, plaintiffs and Susan Chapman filed an eleven-count complaint against Suburban in State court seeking relief under the New Jersey Constitution, the LAD, and various common-law causes-of-action. Defendants moved to dismiss all counts except the eighth count, which alleges that Suburban engaged in unlawful age discrimination. The trial court, among other things, dismissed counts one through six, which asserted that plaintiffs were victims of retaliatory discharge. In those counts, plaintiffs claimed that the discharge was: 1) a violation of N.J.S.A. 10:5-12(d) of the LAD (count one); 2) contrary to a clear mandate of public policy (count two); 3) a violation of State constitutional prohibition against the taking of private property without due process (count three); 4) a breach of contract (count four); 5) a breach of an implied covenant of good faith and fair dealing (count five); and 6) a result of fraudulent misrepresentation (count six).

The Appellate Division granted plaintiffs' motion for leave to appeal the dismissal of counts one through five, but not count six concerning fraudulent misrepresentation. The Appellate Division affirmed the dismissal of counts four and five, reinstated count one and declined to address the dismissal of counts two and three, which it found redundant. The Appellate Division held that plaintiffs, because of their relationship to Susan Chapman as co-workers and co-employed relatives, could maintain a retaliatory-discharge claim under the LAD.

The Supreme Court granted defendants' motion for leave to appeal.

HELD: On the facts of this case, William Craig, Ellen Chapman, William Denino and Ellen Marsillo, as coworkers or relatives of an employee who sued their common employer under the New Jersey Law Against Discrimination, have standing to sue that employer for retaliatory discharge in violation of the LAD.

1. Section 12(d) of the LAD was amended in 1992 to expand the class protected from employer retaliation to include employees who merely aided or encouraged another person in the exercise of that person's rights under the LAD. To establish a prima facie case of discriminatory retaliation, plaintiffs must demonstrate that: 1) they engaged in a protected activity known by the employer; 2) thereafter their employer unlawfully retaliated against them; and 3) their participation in a protected activity caused the retaliation. (pp. 7-8)

2. Ellen Chapman has standing to sue Suburban. By testifying as a witness in Susan's federal court action, Ellen "aided or encouraged" her daughter and co-worker in the exercise or enjoyment of a right granted or protected by the LAD. The other plaintiffs also have standing to sue Suburban. They claim that the pendency of Susan's action and the department's cohesiveness caused Suburban to retaliate against the entire department. To deny standing to the co-workers would encourage employers to take reprisals against the friends, relatives, and colleagues of an employee who has asserted an LAD claim. Through coercion, intimidation, threats, or interference with an employee's co-workers, an employer can discourage an employee from asserting such a claim. (pp. 8-10)

3. Discriminating against one employee in violation of the LAD should not insulate an employer from claims by other employees against whom the employer has retaliated. Reprisals against "innocent victims," such as relatives and close friends who are co-workers, can be coercive, even when the coercion is unintentional. In the context of Suburban's door-to-door sales department, reprisals against ...

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