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Scheers v. Rite Aid Corp.

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


July 9, 2008

DEBORAH A. SCHEERS, PLAINTIFF-APPELLANT,
v.
RITE AID CORPORATION, JOSEPH SUPINO, INDIVIDUALLY, AND AS AGENT, EMPLOYEE AND MANAGER FOR RITE AID CORPORATION, DEFENDANTS-RESPONDENTS.

On appeal from the Superior Court of New Jersey, Law Division, Camden County, Docket No. L-6205-03.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued May 13, 2008

Before Judges Winkelstein, Yannotti and LeWinn.

On November 5, 2003, plaintiff Deborah A. Scheers filed a ten-count complaint against defendants Rite Aid Corporation and Joseph Supino asserting various causes of action. On May 14, 2004, the trial court entered an order dismissing counts one through seven. On June 25, 2004, the court entered an order denying plaintiff's motion for reconsideration. Plaintiff's remaining claims for sexual harassment, a hostile work environment, and sexual assault and battery were tried to a jury, which returned a verdict of no cause for action. Plaintiff appeals from the orders entered on May 14, 2004 and June 25, 2004, as well as the final judgment entered on November 7, 2006. For the reasons that follow, we affirm.

I.

We briefly summarize some of the evidence presented at trial. Plaintiff began working for Rite Aid in July 2000. At the time, plaintiff's sister-in-law, Denise Joseph, was one of Rite Aid's district managers. Joseph offered plaintiff a job based on plaintiff's prior experience in merchandising. Plaintiff's responsibilities at Rite Aid included traveling to various Rite Aid stores, setting up promotional and holiday displays, and assisting with inventory.

Prior to working at Rite Aid, plaintiff had been employed as a clerk by Super G, Inc. In March 1998, while working at a Super G store, plaintiff fell off of a ladder and injured her lower back. Plaintiff testified that in March 2000, she "started hurting real bad[.]" On November 10, 2000, she filed a claim for workmen's compensation benefits. Plaintiff filed two additional workmen's compensation claims on November 27, 2000. In the first claim, she alleged that while working at Super G, in the period from March 1998 to June 2000, she had aggravated her back injury as a result of repeated "bending, stooping, lifting and carrying[.]" In the second claim, plaintiff alleged that she sustained an injury at Super G in March 2000 "while bagging groceries and lifting grocery bags[.]"

In July 2000, before beginning her employment with Rite Aid, plaintiff informed Joseph of her back problems. After she began working at Rite Aid, plaintiff experienced pain and soreness in her back and she had difficulties performing her job duties. In November 2000, plaintiff temporarily resigned from her position at Rite Aid due to her back problems. She was diagnosed with herniated discs. Plaintiff underwent spinal surgery in April 2001 to address that condition.

In July 2001, plaintiff contacted Joseph and expressed an interest in returning to work at Rite Aid. Joseph had been promoted and she informed plaintiff that Steve Hawn had taken over as Rite Aid's district manager. Plaintiff spoke to Hawn and he offered her a position as assistant manager. Initially, plaintiff was assigned to work at the Rite Aid store in Tuckerton, New Jersey, but, after several weeks, she was reassigned to the store in Atco, New Jersey. Supino was the store manager at that location. Plaintiff's job duties included handling merchandise and inventory.

On October 12, 2001, plaintiff strained her lower back while attempting to position shelves in the aisle for seasonal merchandise. Plaintiff was treated by her family physician, who diagnosed a "recurrent" disc herniation. Plaintiff alleged that, at this time, she began to experience problems with Supino.

Plaintiff testified that Supino made various comments to her of a sexual nature that plaintiff thought were inappropriate. According to plaintiff, Supino remarked, "[f]or what I'm paying you, I should get some kind of benefit[.]" He also said, "I know what your problem is, I know what you need." In addition, Supino commented on the physical appearance of the female customers.

Plaintiff said that she spoke to Robert Leylo, Rite Aid's Manager for Human Resources, about problems she was having with Supino, and he referred her to Hawn. Plaintiff said that she spoke to Hawn, but he did not take her concerns seriously. According to plaintiff, Hawn told her that she should "just punch [Supino] in the face."

Plaintiff testified that, thereafter, "things started getting worse[.]" Plaintiff claimed that, on one occasion, Supino brushed up or pressed against her when she attempted to walk past him. Plaintiff said that, on another occasion, she arrived at work and her shirt was not buttoned correctly. When she turned around and attempted to fix the problem, Supino told her not to turn around and said, "[g]o ahead, unbutton it[.]"

Plaintiff stated that another incident occurred when she was standing on a ladder. According to plaintiff, Supino approached her and rubbed her ankle and calf and "part of [her] thigh." Plaintiff said that she was "scared to death[.]" Plaintiff asserted that she spoke with Hawn about changing her position. Hawn told plaintiff that he did not have any other place to put her at the time but he would "work on it."

Plaintiff testified that another incident occurred on November 28, 2001. Plaintiff said that Supino called her into his office to assist him in typing a letter. Plaintiff was sitting down working on the letter and Supino started pressing her hand. Plaintiff said she wanted to "get out of there" as quickly as possible. Plaintiff stated that she was headed for the stairs when Supino placed his "hand on [her] right breast." Plaintiff said that she was startled, jumped backwards, and landed on the step, "right on [her] spine[.]" Plaintiff reported her injury to management and filed a workmen's compensation claim.

Thereafter, plaintiff continued to work at Rite Aid. In January 2002, plaintiff was asked to go to a Rite Aid store in Vineland, New Jersey, to "help out." Plaintiff encountered Hawn at the Vineland store and told him about the November 28, 2001 incident involving Supino.

Hawn told plaintiff that she would not be put back in the Atco store and he instructed plaintiff to prepare a written report of the incident. Hawn discussed the matter with Lelyo and they decided to terminate Supino. Plaintiff then was promoted to the position of store manager at the Atco location.

As part of his duties as district manager, Hawn made periodic inspections of the stores in his district, which included the store in Atco. On September 16, 2002, during an inspection, Hawn found the conditions in the Atco store were deficient and he noted his concerns in a report of his visit.

Hawn returned to the store on September 26, 2002, and again noted various deficiencies in his report. Following his September visits, Hawn learned that plaintiff had referred to him at various times as a "fag" or "faggot."*fn1 On October 3, 2002, Rite Aid terminated plaintiff's employment.

Hawn testified that plaintiff made no complaints to him regarding Supino's sexually inappropriate comments or touching in 2001. He said that the first time plaintiff complained about the alleged sexual harassment was in January 2002, when he met plaintiff at the Vineland store. Plaintiff admitted at trial that she never told Joseph that Supino had inappropriately touched her breast. Plaintiff conceded that, although she had told Leylo of her concerns about Supino, she did not tell him that the concerns were due to sexual harassment.

Plaintiff also testified that, in the workers' compensation claim that she filed in November 2002, she stated that she had been harassed from October 2001 through January 2002; however, she conceded that she was not harassed after November 28, 2001.

Plaintiff additionally conceded that she saw several doctors after the November 28, 2001 incident and never told them that she had been injured as a result of a sexual assault.

As stated previously, the jury rejected plaintiff's claims of sexual harassment, a hostile work environment, and sexual assault and battery.

II.

We first consider plaintiff's contentions that the judge erred by granting defendants' motion to dismiss counts one through seven of her complaint. In those counts, plaintiff asserted claims for breach of an employment agreement (count one); wrongful termination (count two); wrongful termination in violation of Rite Aid's personnel policies (count three); discrimination on the basis of a physical handicap, in violation of the Law Against Discrimination (LAD), N.J.S.A. 10:5-1 to -42, (count four); wrongful termination in violation of the covenant of good faith and fair dealing (counts five and six); and wrongful termination in retaliation for filing a claim for workmen's compensation benefits, contrary to N.J.S.A. 34:15-39.1 (count seven).

We initially note that defendants filed their motion to dismiss pursuant to Rule 4:6-2(e). They argued that, in counts one to seven, plaintiff failed to state a claim upon which relief could be granted. A motion to dismiss for failure to state a claim should be decided based on the facts alleged in the complaint. Printing Mart-Morristown v. Sharp Elec. Corp., 116 N.J. 739, 746 (1989). However, after the trial court granted defendants' motion, plaintiff moved for reconsideration and, in ruling on that motion, the judge considered factual materials outside of the pleadings. Under our court rules, the motion should have been treated as a motion for summary judgment. R. 4:6-2.

Accordingly, we will review the orders entered by the trial court on May 14, 2004, and June 25, 2004, under the summary judgment standard. Prudential Prop. Ins. v. Boylan, 307 N.J. Super. 162, 167 (App. Div.), certif. denied, 154 N.J. 608 (1998). We therefore must determine whether the evidential materials presented to the trial court raised a genuine issue as to any material fact, and whether defendants were entitled to judgment as a matter of law. R. 4:46-2(c); Brill v. Guardian Life Ins. Co. of Am., 142 N.J. 520, 540 (1995).

A. Counts One, Two, Three, Five and Six

In counts one, two and three of the complaint, plaintiff alleged that she had been terminated in violation of an employment agreement. However, plaintiff presented no evidence that she had an agreement with Rite Aid that gave her a right to continued employment. In the absence of such an agreement, plaintiff was an "at will" employee. Witkowski v. Thomas J. Lipton, Inc., 136 N.J. 385, 397 (1994). As such, plaintiff could be terminated "for [a] good reason, [a] bad reason, or no reason at all." Ibid.

Furthermore, plaintiff alleged in counts two and three that she had been terminated in violation of Rite Aid's personnel policies. "An employment manual providing terms and conditions of employment that include grounds and procedures for dismissal can create an employment contract." Id. at 392. Nevertheless, the employer may "overcome the implication that an employment manual constitutes an enforceable contract of employment" by using an effective disclaimer. Nicosia v. Wakefern Food Corp., 136 N.J. 401, 412 (1994). In this case, plaintiff failed to present any evidence to show that Rite Aid had an employment manual or personnel policies that created an employment contract. Indeed, plaintiff never identified the personnel policies that were allegedly violated by her termination.

In counts five and six, plaintiff alleged that her termination violated the implied covenant of good faith and fair dealing. The doctrine applies when "there is some type of employment contract, even if it is merely 'at will.'" Peck v. Imedia, 293 N.J. Super. 151, 168 (App. Div.), certif. denied, 147 N.J. 262 (1996). However, as we explained in Nolan v. Control Data Corp., 243 N.J. Super. 420, 429 (App. Div. 1990):

[w]hile [it is] true that in New Jersey an employer can discharge an "at will" employee at any time and for any reason, this principle is a consequence of the fact that the length of an "at will" employee's engagement is not controlled by contract. In the absence of a contract, there is no implied covenant of good faith and fair dealing. Noye v. Hoffman-La Roche, Inc., 238 N.J. Super. 430, 433 (App. Div. 1990). This does not mean that an implied obligation of good faith is inapplicable to those aspects of the employer-employee relationship which are governed by some contractual terms, regardless [of] whether that relationship is characterized generally as being "at will."

As stated previously, plaintiff did not have a contract with Rite Aid that gave her a right to continued employment. Because the length of plaintiff's employment was not controlled by an agreement, the implied covenant of "good faith and fair dealing" did not apply.

We therefore conclude that summary judgment was properly entered in favor of defendants on counts one, two, three, five and six.

B. Count Four

In count four of her complaint, plaintiff alleged that her termination was the result of unlawful discrimination on the basis of a handicap, in violation of the LAD. Plaintiff argues that she presented sufficient evidence to establish a prima facie case on this claim. Plaintiff additionally contends that the evidence she submitted was sufficient to raise a genuine issue of material fact as to whether Rite Aid's reasons for terminating her employment were a pretext for unlawful discrimination. We disagree.

To establish a prima facie case on an LAD claim of handicap discrimination, a plaintiff must show that: 1) she is disabled within the meaning of the law; 2) she had been performing her job in a manner that met her employer's legitimate expectations; 3) she was nevertheless fired; and 4) the employer hired another person to perform the same work after she was removed from her position. Jansen v. Food Circus Supermarkets, Inc., 110 N.J. 363, 382 (1988). If the plaintiff presents a prima facie case, the burden shifts to the employer to establish a non-discriminatory reason for the plaintiff's termination. Ibid. The plaintiff then must establish that the reasons offered by the employer are a pretext for unlawful discrimination. Id. 382-83.

Here, Rite Aid offered non-discriminatory reasons for plaintiff's termination, specifically, plaintiff's deficient job performance, as detailed by Hawn in the reports of his store visits in September 2002. Nothwithstanding her assertions to the contrary, plaintiff failed to present sufficient evidence to raise a genuine issue of material fact as to whether those reasons were merely a pretext for unlawful discrimination on the basis of a physical disability or handicap.

In her motion for reconsideration, plaintiff presented the trial court with sales reports that indicated her store was doing comparatively well in its sales.*fn2 However, that evidence did not specifically address the many deficiencies that Hawn had identified in his reports. Indeed, the deficiencies in plaintiff's performance had nothing to do with sales but instead focused on other concerns such as the clutter in the store, the lack of organization in the merchandise, the failure to pay invoices, the failure to count the cigarette inventory every other week, the failure to conduct audits and check bags, and the failure to comply with the company's tagging policy.

Moreover, plaintiff failed to present any evidence that would support an inference that she was terminated because of any physical disability or handicap. In ruling on plaintiff's motion for reconsideration, the judge aptly observed that the evidence showed that the reasons plaintiff was fired "had nothing to do with her disability[.]" As the judge pointed out, plaintiff was terminated "because she didn't run the store properly according to [Rite-Aid's] requirements[.]"

Therefore, we conclude that the trial court correctly found that defendants were entitled to summary judgment on count four of the complaint.

C. Count Seven

In count seven, plaintiff alleged that she had been terminated because she filed a claim for workmen's compensation benefits, in violation of N.J.S.A. 34:15-39.1. The statute provides in pertinent part that it is unlawful for any employer "to discharge or in any other manner discriminate against an employee as to his [or her] employment because such employee has claimed or attempted to claim workmen's compensation benefits[.]" Ibid.

The motion judge found that plaintiff failed to establish a causal relationship between her termination and the filing of her claim for workmen's compensation benefits. The record supports the judge's finding. As we stated previously, plaintiff was terminated because her job performance was deficient. Plaintiff did not present sufficient evidence to raise a genuine issue of material fact as to whether her termination was in any way related to her filing of a claim for workmen's compensation benefits.

Indeed, the record shows that Rite-Aid hired plaintiff in July 2000 knowing that she had injured her back while working for her former employer. Plaintiff resigned from her position at Rite Aid after experiencing back problems but she was re-hired and returned to her job. Plaintiff filed a workmen's compensation claim after her fall on November 28, 2001. Despite the filing of that claim, Rite Aid promoted her to store manager in January 2002.

We are convinced that, in light of this evidence, a reasonable jury could not find that Rite Aid terminated plaintiff because she had filed a claim for workmen's compensation benefits. Accordingly, defendants were entitled to summary judgment on count seven.

We therefore affirm the order entered by the trial court on May 14, 2004 dismissing counts one through seven, and the order entered on June 25, 2004, denying plaintiff's motion for reconsideration.

III.

Plaintiff raises two issues with regard to certain evidentiary rulings made by the judge during the trial on her claims for sexual harassment, a hostile work environment, and sexual assault and battery. Plaintiff argues that the judge's evidentiary rulings were incorrect and, as a result, she was denied a fair trial on her claims. Plaintiff seeks reversal of the final judgment and a remand for a new trial. We conclude that such relief is not warranted.

A. Evidence of Other Acts of Sexual Harassment

Plaintiff first argues that the trial judge erred by precluding her from presenting evidence that Supino sexually harassed Amity Lemasters when they were working together in Rite Aid's Atco store. The judge found that the evidence was not relevant to plaintiff's claims based on a hostile work environment but was potentially relevant to Rite Aid's contention that it had in place an effective sexual harassment policy. The judge nevertheless excluded the evidence pursuant to N.J.R.E. 403.

The standard of review that governs our consideration of this argument is well established. A trial court's decision with regard to the admissibility of evidence "is entitled to great deference and ordinarily should not be disturbed unless it is 'wide of the mark.'" State v. B.M., 397 N.J. Super. 367, 374 (App. Div. 2008) (quoting State v. Fortin, 189 N.J. 579, 597 (2007)). Applying that standard, we are convinced that the trial judge did not abuse his discretion by precluding plaintiff from presenting the evidence of Supino's alleged sexual harassment of Lemasters.

It is undisputed that plaintiff was not present in the Atco store when the alleged sexual harassment of Lemasters occurred. Evidence of sexual harassment directed at persons other than the plaintiff may be relevant to the plaintiff's claim for a hostile work environment. Lehmann v. Toys "R" Us, 132 N.J. 587, 611 (1993). However, "harassment of which a plaintiff is entirely unaware cannot contribute to that environment because plaintiff does not experience it." Fitzgerald v. Stanley Roberts, Inc., 186 N.J. 286, 319 (2006) (citing Lehmann, supra, 132 N.J. at 610-11). Here, plaintiff was "entirely unaware" of Supino's alleged sexual harassment of Lemasters while she was working for Rite Aid. Therefore, the proffered evidence was not relevant to whether plaintiff had been subjected to a hostile work environment.

Even so, evidence of sexual harassment of other employees may be relevant to a claim by an employer that it had an effective sexual harassment policy. Id. at 320. In this case, the trial judge determined that the evidence of the alleged sexual harassment of Lemasters was relevant to whether Rite Aid had an effective sexual harassment policy. However, the evidence had limited probative value on that issue because Lemasters never reported the alleged sexual harassment to Rite Aid.

The judge also noted that the evidence would unduly prejudice defendants because the jury would in all likelihood not limit its consideration of the evidence to Rite Aid's policy but would be inclined to believe that Supino sexually harassed or assaulted plaintiff simply because there was evidence that he sexually harassed Lemasters. In addition, the judge found that admission of the evidence would unduly prolong the trial and lead to what would, in effect, be a "mini-trial" on Lemasters' allegations.

We are satisfied that the judge properly exercised his discretion under N.J.R.E. 403 in weighing the probative value of the evidence against the potential for undue prejudice and consumption of time. In our view, the judge did not abuse his discretion by excluding the evidence of the alleged sexual harassment.

Plaintiff argues, however, that admission of the evidence is required under Fitzgerald. We disagree. In that case, the plaintiff asserted claims for sexual harassment, a hostile work environment, and retaliatory discharge. Fitzgerald, supra, 186 N.J. at 294. The plaintiff testified that she was aware of the company's policy regarding sexual harassment and it required that notice of any such harassment be given to a supervisor or officer of the company. Id. at 294-95. The plaintiff claimed that the employees did not take the policy seriously because it was unlikely that the employer would take action to remedy any such complaint. Id. at 295.

The trial court in Fitzgerald admitted evidence that other employees had been subjected to sexual harassment in the workplace. Id. at 319. The Supreme Court held that the judge did not abuse his discretion in doing so because, although the evidence was not relevant to the plaintiff's hostile work environment claim, it was relevant to the defendants' contentions that the company had an effective sexual harassment policy and that "there was no problem with sexual harassment at the firm." Id. at 320.

In our view, Fitzgerald is distinguishable. In this case, Rite Aid presented evidence that it had a policy against sexual harassment. That evidence was presented to show that there were procedures available to plaintiff to report instances of sexual harassment and, although plaintiff claimed that she had been harassed by Supino beginning in October 2001, she failed to report the alleged harassment to Hawn until January 2002. Plaintiff never claimed that Rite Aid's policy was ineffective. Moreover, Rite Aid never asserted that there was no problem with sexual harassment in its stores.

Therefore, the evidence that Supino allegedly harassed Lemasters had little probative value on the issues regarding Rite Aid's sexual harassment policy that were raised at trial. Moreover, Fitzgerald does not require the admission of evidence regarding other alleged acts of sexual harassment or discrimination in every case where an issue is raised regarding an employer's sexual harassment policy. The admission of such evidence must be decided on a case by case basis and the trial judge retains discretion under N.J.R.E. 403 to exclude such evidence if its probative value is outweighed by other relevant concerns.

B. Social Security Disability Determination

At trial, plaintiff called Dr. Robert Wolf as an expert to testify as to plaintiff's future wage loss. Plaintiff argues that the judge erred by refusing to permit Dr. Wolf to testify that the Social Security Administration (SSA) had found that plaintiff was totally disabled. Plaintiff says that she "wanted the jury to hear evidence of [her] total disability so that those physical limitations could be incorporated into the jury charge seeking monetary damages[.]"

We note that, contrary to plaintiff's assertions, the trial judge permitted Dr. Wolf to testify that plaintiff was receiving social security disability benefits but he precluded the doctor from stating that the disability was causally related to the November 28, 2001 incident. In his testimony, Dr. Wolf stated that plaintiff had "qualified for [s]ocial [s]security [d]isability benefits and . . . is receiving [those] benefits[.]" Wolf also stated that in order to qualify for such benefits, "[plaintiff] had to be determined to be unable to perform any work existing anywhere in the national economy[.]" Therefore, plaintiff's contention that the judge precluded all mention of the SSA's disability determination is not supported by the record.

To the extent that plaintiff is arguing that the judge erred by refusing to permit Dr. Wolf to relate plaintiff's disability to the November 28, 2001 incident, we decline to address that argument. As plaintiff recognizes, Dr. Wolf's testimony related solely to the issue of monetary damages. The jury found that defendants were not liable and never considered the issue of damages. Because we have determined that there is no basis to reverse the jury's liability verdict, the issue raised by plaintiff regarding the limits placed on Dr. Wolf's testimony is moot.

Affirmed.


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