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Zanes v. Fairfield Communities


July 17, 2008


The opinion of the court was delivered by: Irenas, Senior District Judge


This is a retaliatory discharge suit filed by William "Bill" Zanes, against his former employer, Fairfield Communities, Inc. ("Fairfield"), disputed former employer, Cendant Corporation ("Cendant"), and Michael Walker, his former supervisor. Zanes asserts that he was wrongfully transferred and then terminated from his position after he complained to management about his employer's alleged racially discriminatory marketing practices.*fn1 He primarily asserts claims under New Jersey's Conscientious Employee Protection Act ("CEPA"), N.J.S.A. 34:19-1 et. seq., and Law Against Discrimination ("LAD"), N.J.S.A. 10-5:1 et. seq., and also asserts a defamation claim. Defendants move for summary judgment. For the reasons stated herein, the Motion will be granted in part and denied in part.


Plaintiff Zanes was employed as a "Commission Marketing Professional," or "CMP," with Fairfield for approximately one year-- from April 2003, to May 14, 2004, when he was fired. (Zanes Dep. p. 31-32) Working inside various Trump properties in Atlantic City, Zanes was employed to market Fairfield timeshare vacations by recruiting potential customers.*fn2 (Id. at 55) Zanes' job was to persuade potential customers to take a tour of the Fairfield resort to learn about available timeshares. (Id.)

During the first four months of Zanes' employment, all CMPs rotated sites, working at either Trump Taj Mahal, Trump Plaza, or Trump Marina, depending on the shift to which they were assigned. (Zanes Dep. p. 45, 49, 66) Then Fairfield changed the site/shift assignment process, which resulted in Zanes working most of his shifts at the Taj Mahal. (Id. at 66) Zanes was pleased with the change in policy, because he had the best success rate when he worked at the Taj Mahal, as opposed to the other locations. (Id. at 50)*fn3

During the course of Zanes' employment, Fairfield held various training sessions and meetings where management instructed CMPs (including Zanes) about people whom management determined to be the most desirable to solicit and how to describe the tour. At various meetings and training sessions, at least three management personnel instructed Fairfield employees not to approach people of Asian or Indian descent, single males, non-U.S. citizens, and people who did not speak "perfect English." (Zanes Dep. p. 174-75, 187; Draughn Dep. p. 137-39) Specifically, Zanes testified that his supervisor told him that, at Defendant Walker's direction,*fn4 Zanes would not be paid for tours he booked if the potential customers were Asian or Indian. (Id. at 174) One of Zanes' supervisors, Janice Draughn, also testified,

[W]e were told not to market Asians but I said well, hey, if they qualify, it's not in paper. If they are a couple and they got a credit card and meet the qualifications and it doesn't matter if they got a dot on their head or not. . . . it was like I'm not going to discriminate. . . . What they called dot heads came in, if they have a credit card, if they meet the other qualifications, then let them turn it around at the registration desk. (Draughn Dep. p. 85) Draughn further stated that she was instructed by management to avoid marketing timeshares to single men and non-U.S. citizens. (Id. p. 83)

Zanes claims that he was instructed to lie to people who did not meet the company's qualifications to participate in the tour,*fn5 by telling them that the tour was completely full. (Id. p. 158-59) Zanes felt these instructions were "wrong" and objected at the meetings saying, "I feel it's wrong and I'm not going to do it." (Id. at 168)*fn6 Elaborating on what he meant, Zanes explained at his deposition,

I think that everyone should have an equal chance to buy a timeshare, no matter what country you're from or your language, or whether you're black, white, Asian, Hispanic. I thought it was wrong to say there were certain ethnicity [sic], or if I booked them I wouldn't get paid for it. And honestly, I think it's wrong, lying to people. (Id. at 163)

Zanes believes that Walker "wanted to find a way to get rid of [him]" because of his objections. (Zanes Dep. p. 71-72, 126-27) Specifically, Zanes believes that he was transferred from his post at the Taj Mahal and then later fired because of his objections.

At the end of February 2004, Zanes was rotated from his post at the Taj Mahal to a post at the Trump Plaza. (Stmnt of Undisp. Facts, ¶ 5) According to Zanes, the move was an undesirable change in his employment conditions because it was commonly known among the CMPs and Fairfield management that CMPs stationed at the Taj Mahal had the highest success rate with attracting qualified consumers. (Zanes Dep. p. 50-51)

Approximately three months later, in May, Walker received from the Trump organization a copy of an e-mail complaint which Defendants assert led to Zanes' termination. A patron of the Plaza casino e-mailed the Trump Plaza stating that a "representative of a timeshare company" gave her and her husband a "pitch" which included a "story" about "a black woman . . . who cheated the system." (Walker Cert. Ex. A) The patron said she found the story particularly offensive because she is "biracial." (Id.) Trying to identify the employee who made the comments, she stated, "I believe his name was Bob. He was working in your casino last Saturday afternoon." (Id.)*fn7

Zanes denies that he was the employee identified in the e-mail, although the Fairfield schedule for that day indicates that Zanes was the only male employee working at that location in the Plaza the entire day. (Bessinger Cert. Ex. I; Draughn Dep. p. 31-34)

According to Walker, "a Vice President of Trump" faxed him a copy of the e-mail complaint on May 14, 2004. (Walker Cert. ¶ 3, 5) After reading the e-mail, determining that Zanes was the only male employee working at that location on that date, and examining Zanes' personnel file,*fn8 Walker decided to fire Zanes. (Id. at ¶ 5)

Zanes testified that on May 14, 2004, he was called into his immediate supervisor's office and told, "'Mike Walker is terminating you.'" (Zanes Dep. p. 130, 134) When Zanes asked why he was being fired, he was told about the e-mail complaint. (Id. at 134)

This suit followed. Zanes' Amended Complaint primarily asserts retaliatory discharge claims under New Jersey's Conscientious Employee Protection Act ("CEPA") (Count 1) and New Jersey's Law Against Discrimination ("LAD") (Count 4). In addition to these claims, the Amended Complaint also asserts claims of defamation (Counts 2 and 5),*fn9 and vicarious liability of Defendants Fairfield and Cendant for the allegedly wrongful actions of Zanes' supervisors (Count 3).*fn10


"[S]ummary judgment is proper 'if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.'" Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986) (quoting Fed. R. Civ. P. 56(c)). In deciding a motion for summary judgment, the Court must construe the facts and inferences in a light most favorable to the non-moving party. Pollock v. Am. Tel. & Tel. Long Lines, 794 F.2d 860, 864 (3d Cir. 1986).

"'With respect to an issue on which the non-moving party bears the burden of proof, the burden on the moving party may be discharged by 'showing'-- that is, pointing out to the district court -- that there is an absence of evidence to support the nonmoving party's case.'" Conoshenti v. Public Serv. Elec. & Gas, 364 F.3d 135, 145-46 (3d Cir. 2004) (quoting Celotex). The role of the Court is not "to weigh the evidence and determine the truth of the matter, but to determine whether there is a genuine issue for trial." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249 (1986).



Defendants move for summary judgment on the CEPA claim, asserting that Zanes has failed to adduce sufficient evidence to support a prima facie claim of retaliation. Defendants further argue that Zanes cannot establish that Defendants' proffered reason for the adverse employment action was pretext for retaliatory motive. The Court disagrees.

CEPA provides,

An employer shall not take any retaliatory action against an employee because the employee does any of the following: . . . c. Objects to, or refuses to participate in any activity, policy or practice which the employee reasonably believes: (1) is in violation of a law, or a rule or regulation promulgated pursuant to law.

N.J.S.A. 34:19-3(c)(1).

The familiar burden-shifting framework applies to CEPA retaliation claims: A plaintiff must establish a prima facie case; then the burden shifts to the employer to provide a legitimate non-retaliatory reason for the adverse employment action*fn11 ; then the burden shifts back to the plaintiff to demonstrate that the non-retaliatory reason was pretext for a prohibited reason. See Fleming v. Correctional Healthcare Solutions, Inc., 164 N.J. 90, 100 (2000). To establish a prima facie case of retaliation under CEPA, Zanes must establish (1) his reasonable belief that his employer's conduct violated a law, rule, or regulation; (2) a whistle-blowing activity; (3) an adverse employment action; and (4) a causal connection between her whistle-blowing activity and the adverse employment action. See Caver v. The City of Trenton, 420 F.3d 243, 254 (3d Cir. 2005); Dzwonar v. McDevitt, 177 N.J. 451, 462 (2003). Defendants expressly do not dispute factors (1) and (2). (Def. Br. at p. 14, n.7)

Adverse Employment Action

Zanes asserts two adverse employment actions: his transfer from the Taj Mahal station to the Plaza station, and his termination. Defendants do not dispute that termination is an adverse employment action,*fn12 but they do dispute that Zanes' transfer was an adverse action, arguing that Zanes' transfer did not alter any terms of his employment, including his compensation structure or duties.

To the extent that Zanes asserts that his transfer was part of a larger hostile environment created by Defendants in retaliation for his asserted protected conduct, it may constitute an adverse employment action under CEPA. Green v. Jersey City Bd. of Educ., explains,

"Retaliation," as defined by CEPA, need not be a single discrete action. Indeed, "adverse employment action taken against an employee in the terms and conditions of employment," N.J.S.A. 34:19-2e, can include . . . many separate but relatively minor instances of behavior directed against an employee that may not be actionable individually but that combine to make up a pattern of retaliatory conduct. 177 N.J. 434, 445 (2003). Zanes asserts that his transfer, and the allegedly meritless disciplinary actions taken against him, were all prompted by his complaints about Fairfield's marketing practices. Whether or not Zanes' transfer actually resulted in a pay decrease,*fn13 Zanes has put forth evidence that he, as well as other CMPs, preferred working at the Taj Mahal. Thus, a reasonable factfinder could conclude that the transfer was a hostile action insofar as it deprived Zanes of a preferred post. The undesirable transfer and the allegedly meritless discipline, combined, could support a conclusion that Defendants created a hostile environment sufficient to constitute adverse employment action under Green.

Causal Connection

Circumstantial evidence may be used to prove causation. "[T]emporal proximity between the employee's [protected conduct] and the adverse employment action or a 'pattern of antagonism' on the part of the employer following the protected expression can raise the inference of causation." Espinosa v. County of Union, 212 F. App'x 146, 153 (3d Cir. 2007). Considering the record as a whole, Zanes' evidence of antagonism and temporal proximity could reasonably support a finding of causation.

Zanes testified that he complained about the allegedly discriminatory marketing practices at training meetings, "[e]ither at the end of 2003 or the beginning of 2004, in that middle." (Zanes Dep. p. 161) Before that time, Zanes had not been the subject of any disciplinary action. After that time, he received two written disciplinary notices in the span of approximately one month.*fn14 Shortly after the two written notices were issued, at the end of February, 2004, Zanes was transferred to the Plaza. (Stmnt of Undisp. Facts ¶ 5) Approximately one month after Zanes was transferred, on March 14, 2004, he was fired. Thus, the evidence, viewed in the light most favorable to Zanes, could lead a reasonable factfinder to find that Zanes' complaints triggered several antagonistic actions by Defendants that followed in relatively rapid succession. Such a finding would be sufficient to establish the requisite causal connection element of Zanes' prima facie case.


Defendants assert that even if Zanes can establish a prima facie claim under CEPA, his claim must nevertheless fail because the record evidence cannot establish that the reasons for their actions were pretextual. The issue is whether plaintiff has offered sufficient evidence for a reasonable jury to find that the employer's proffered reason for the discharge was pretextual and that retaliation for the whistleblowing was the real reason for the discharge. Typically, the types of evidence that the plaintiff must point to are inconsistencies or anomalies that could support an inference that the employer did not act for its stated reasons.

Blackburn v. UPS, Inc., 179 F.3d 81, 93 (3d Cir. 1999)(internal citations and quotations omitted).

Defendants have put forth a legitimate non-retaliatory reason for terminating Zanes: the e-mail complaint by a Plaza patron.*fn15

Zanes asserts that his employer's failure to investigate the complaint is evidence of pretext. Indeed, the undisputed record shows that Zanes was fired on the same day the complaint came to Defendant Walker's attention, and that Zanes was summarily fired without an opportunity to deny, explain, or otherwise respond to the allegations. While nothing in the record suggests that firing Zanes without giving him an opportunity to be heard was a violation of company policy or practice,*fn16 the abrupt nature of Zanes' termination could be found to be somewhat anomalous.

Walker states that he looked at Zanes' employment file before deciding to terminate him. (Walker Cert. ¶ 5) Although the file contained two recent disciplinary notices, neither notice resulted from any alleged racist comment or other actions of similar severity.*fn17 Construing these facts in the light most favorable to Zanes, a reasonable factfinder could conclude that immediately terminating Zanes was a disproportionate reaction to the situation, thereby suggesting that the termination was pretextual. Cf. Grazioli v. Genuine Parts Co., 409 F. Supp. 2d 569, 583 (D.N.J. 2005)(Irenas, S.J.) ("The unusual speed with which the investigation occurred, including the fact that no one asked [plaintiff] for her side of the story before concluding that her actions warranted termination, raises questions about [defendant's] proffered reason for termination."). Such a conclusion is further supported by the climate of antagonism within which Zanes' termination occurred. See supra p. 11, discussion of causal connection.

Accordingly, the Court holds that Zanes has put forth sufficient evidence to support a finding of pretext and to support a prima facie case of retaliation under CEPA. Defendants' Motion for Summary Judgment on the CEPA claim will be denied.


Defendants assert that CEPA's waiver provision precludes Zanes' LAD claim as a matter of law. The Court agrees.

CEPA's waiver provision states,

Nothing in this act shall be deemed to diminish the rights, privileges, or remedies of any employee under any other federal or State law or regulation or under any collective bargaining agreement or employment contract; except that the institution of an action in accordance with this act shall be deemed a waiver of the rights and remedies available under any other contract, collective bargaining agreement, State law, rule or regulation or under the common law.

N.J.S.A. 34:19-8.

In Young v. Schering Corp., the New Jersey Supreme Court rejected a literal reading of the waiver provision, which would force employees to "choose between a CEPA claim and other legitimate claims that are substantially, if not totally, independent of the retaliatory discharge claim." 141 N.J. 16, 25 (1995). Instead, the Court held, the wavier exception means, for purposes of this case, that once a CEPA claims is 'instituted,' any rights or claims for retaliatory discharge based on a contract of employment; collective bargaining agreement; State law, whether its origin is the Legislature, the courts, the common law rule of court; or regulations or decision based on statutory authority, are all waived.

Id. at 29 (emphasis added). Thus, only plaintiff's claims that required a finding of retaliatory discharge were precluded by CEPA. Id. Claims that "'d[id] not resemble the alleged CEPA violations and require[d] different proofs than those needed to substantiate a CEPA claim'" were allowed to proceed. Id. at 31.

Here, it is clear that Zanes asserts a retaliatory discharge claim under the LAD. He claims that he was subjected to a hostile work environment and then abruptly fired in retaliation for opposing discriminatory marketing practices prohibited by LAD. Thus, his LAD claim closely resembles, and does not require different proofs from, his CEPA claim. See Bowen v. Parking Auth. of Camden, No. 00-5765, 2003 WL 22145814, at *23 (D.N.J. Sept. 18, 2003)(Simandle, J.) (dismissing LAD claim as waived by the pursuit of CEPA claim because "'blowing the whistle' on discrimination [under LAD] is 'blowing the whistle' on a 'practice in violation of law' [under CEPA]."). Accordingly, summary judgment is warranted on the LAD claim.


Defendants further argue that Defendant Walker is entitled to judgment in his favor on the CEPA claim because CEPA does not provide for individual liability of supervisors. In so arguing, Defendants exclusively rely on Ecker v. Dana Transport Systems, Inc. et al., which, admittedly, does hold that supervisors are not subject to individual liability under CEPA. 2006 WL 740468 at *2 (N.J. Sup. Ct. 2006). However, the substantial weight of authority, indeed all other authority (none of which Defendants cite, much less distinguish), is to the contrary.*fn18 This Court agrees with Judge Hillman's rejection of Ecker in favor of "the rule as stated by the Third Circuit in Fasano and the reasoning in Palladino" which provides for individual liability under CEPA. Gunnings v. Borough of Woodlynne, No. 05-5459, 2007 WL 4591290 at *13 (D.N.J. Dec. 28, 2007). Accordingly, Defendant Walker's Motion for Summary Judgment as to the CEPA claim will be denied.


Defendant Cendant Corporation moves for summary judgment on all claims against it, asserting that it was not Zanes' employer. Cendant submits the certification of Fairfield's*fn19 Area Vice President for Human Resources who states that Cendant and Fairfield were two separate corporate entities, and that "Zanes was employed solely by Fairfield, and not by . . . Cendant Corporation." (Masticola Cert. ¶ 2) However Defendants' own documents raise material questions of fact as to whether Cendant employed Zanes. The name "Cendant Corporation" appears at the top of each page of Zanes' payroll documents. (Masticola Cert. Ex. B) Defendants give no explanation for this fact. Accordingly, summary judgment must be denied.


Lastly, summary judgment will be granted on the defamation claim. The contours of Zanes' defamation claim are less than clear. Indeed, Zanes' opposition brief makes no argument with regard to the defamation claim.*fn20 The Amended Complaint asserts, "[a]ll statements as to plaintiff's survey problems or alleged racial hatred at Trump Plaza were false and defamatory per se." (Amend. Compl. p. 8)

"In addition to alleging defamatory statements, the complaint must plead facts sufficient to identify the defamer and the circumstances of publication." Printing Mart-Morristown v. Sharp Electronics Corp., 116 N.J. 739, 767-68 (1989).

On the present record, the Court cannot ascertain what "survey problems" the Amended Complaint references. Nor is it clear who Zanes asserts made the allegedly defamatory statements*fn21 or when the statements were made. In short, the defamation claim might not have survived a motion to dismiss (had one been made) and it surely cannot survive this motion for summary judgment. The record fails to sufficiently establish the circumstances of publication, nor does it establish special damages. See Ward v. Zelikovsky, 136 N.J. 516, 540 (1994)("To succeed in an action for slander, the plaintiff must demonstrate actual harm to reputation through the production of concrete proof.").*fn22

Accordingly, Defendants are entitled to summary judgment on the defamation claim.


For the foregoing reasons, the Court will grant in part and deny in part Defendants' Motion for Summary Judgment. The CEPA claim will remain against all Defendants, but all other claims will be dismissed. An appropriate order will be issued.

Joseph E. Irenas, S.U.S.D.J.

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