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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

KATHLEEN SCHEPIS : CIVIL ACTION

 :

: NO. 03-cv-05970

v. :

:

RAYLON CORPORATION, et al. :

MEMORANDUM OPINION AND ORDER

GOLDEN, J. September 26, 2006

Plaintiff Kathleen Schepis has brought suit under Title VII of the Civil Rights Act of

1964 and the Pennsylvania Human Relations Act (PHRA) against her former employer Raylon

Corporation, alleging that she lost her job after an episode of quid pro quo sexual harassment by

an executive of one of Raylon’s major suppliers, co-defendant L’Oreal USA. Both Raylon and

L’Oreal moved for summary judgment on Schepis’ claims, asserting that she failed to make a

prima facie case of harassment or to rebut the legitimate, nondiscriminatory reasons provided for

her dismissal. The lone individual defendant and the L’Oreal executive on whom the harassment

claim centers, David Craggs, joined L'Oreal in its motion and also offered an argument for

summary judgment on Schepis’ PHRA claim against him. Schepis, in turn, moved for partial

summary judgment on the questions of whether she was an employee of L’Oreal as well as

Raylon, and whether L’Oreal is strictly liable to her for the behavior of defendant Craggs. For

the foregoing reasons, all of these motions for summary judgment are denied.

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A. Factual Background

The facts of the case are disputed, but the parties agree to the following: in 2001, Schepis

had a brief career as a L’Oreal Sales and Education Coordinator for Raylon, a Berks County

corporation which serves as a distributor of L’Oreal products. In her position, Schepis traveled

to regional salons to teach salon employees how to properly use L’Oreal products. 

At L’Oreal’s invitation, Schepis attended the Tour de Force national sales conference in

West Palm Beach, Florida from October 2-5, 2001. On the evening of October 3, Schepis and

David Craggs, President of the Professional Products Division of L’Oreal USA, were seated at

the same table during the “Dress for Success” dinner. After the dinner, Schepis and Craggs, in

the company of another conference attendee and her friend, left the conference site and traveled

to two local night spots, parting ways in the early hours of October 4. 

Schepis claims that Craggs made several sexual advances over the course of their evening

together, which she rebuffed. Schepis claims that in retaliation for her rebuff, Craggs used his

leverage as a Raylon supplier to have her fired from her job. Raylon terminated Schepis’

employment shortly after her return from Florida, on October 25, 2001. 

In contrast, Craggs denies that he behaved inappropriately with Schepis, asserting that she

was the predatory party during their evening in Florida. Craggs and both business co-defendants

deny that Craggs played any role in Schepis’ discharge from Raylon. They maintain that Raylon

released Schepis because of legitimate concerns over her performance and professional behavior. 

B. The Standard for Summary Judgment

Summary judgment is appropriate only when “the pleadings, depositions, answers to

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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 judgment as a matter

of law.” Fed. R. Civ. P. 56(c). A fact is “material” only if its existence or non-existence would

affect the outcome of the suit under governing law. Anderson v. Liberty Lobby, Inc., 477 U.S.

242, 249, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986). An issue of fact is “genuine” only when

there is sufficient evidence from which a reasonable jury could find in favor of the non-moving

party regarding the existence of that fact. Id. In determining whether there exist genuine issues

of material fact, all inferences must be drawn, and all doubts must be resolved, in favor of the

non-moving party. Coregis Ins. Co. v. Baratta & Fenerty, Ltd., 264 F.3d 302, 305-06 (3d Cir.

2001) (citing Anderson, 477 U.S. at 248). A court may not grant summary judgment if “the

dispute about a material fact is "genuine," that is, if the evidence is such that a reasonable jury

could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248.

C. Defendants’ Motion for Summary Judgment

Defendants Raylon, L’Oreal, and David Craggs have moved for summary judgment,

asserting that there are no material facts at issue in the case. They claim that Schepis has failed

to make an adequate prima facie claim of sexual harassment, or, alternatively, that she has failed

to adequately rebut the legitimate, non-discriminatory reasons offered for her dismissal. 

To make a claim for quid pro quo sexual harassment, a plaintiff must establish that “his

or her response to unwelcome advances was subsequently used as a basis for a decision about

compensation, [terms, conditions, or privileges or employment].” Farrell v. Planters Lifesavers

Co., 206 F.3d 271, 281 (3d Cir. 2000) (quoting Robinson v. City of Pittsburgh, 120 F.3d 1286,

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1297 (3d Cir. 1997). At the summary judgment phase, the Third Circuit authorizes a “quite

broad” analysis of the causal link between the alleged harassment and the subsequent

employment decision. Id. at 283. The court must draw inferences in favor of the non-moving

party, and consider circumstantial evidence. Id. The plaintiff’s own statements, the relatively

close timing of the alleged events and the termination of her employment, and inconsistencies

within the employer’s asserted reasons for the firing, are all forms of circumstantial evidence that

the court can consider in deciding a motion for summary judgment in a quid pro quo case. Id. at

285-286. 

In this case, Schepis’ statements in her deposition create a genuine issue of material fact

regarding the events of October 3 and 4, 2001. Moreover, the close proximity of the alleged

harassment and Schepis’ discharge from Raylon, which took place just 20 days after her return

from Florida, is circumstantial evidence of unlawful termination. Finally, there are

inconsistencies within Raylon’s justifications for firing Schepis. Raylon claims that it fired

Schepis for unprofessional behavior and a number of office policy infractions, including late

submission of expense reports and abuse of corporate credit cards. Nonetheless, just weeks

before her termination, Raylon sent Ms. Schepis to an elaborate, out-of-state professional

development event sponsored by an important supplier. Raylon’s choice is inconsistent with

Schepis’ alleged professional shortcomings. Thus, these pieces of circumstantial evidence permit

Schepis to build a prima facie case of sexual harassment. 

Under the burden-shifting framework of McDonnell Douglas Corp. v. Green, 411 U.S.

792 (1973), and related cases, once the plaintiff has made a prima facie case of discrimination,

the burden then shifts to the defendant to offer a legitimate, non-discriminatory reason for an

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employees’ dismissal. Josey v. John R. Hollingsworth Corp., 996 F.2d 632, 647-38 (3d Cir.

1993). Raylon, L’Oreal, and Mr. Craggs easily bear this burden, citing tardiness, deficiencies as

a teacher, and the office policy infractions described above. 

With the defendants’ burden met, the burden shifts back to the plaintiff to show by a

preponderance of the evidence that the defendants’ proffered reasons for the firing are pretextual. 

Id. The plaintiff may prove pretext either through direct evidence, or by showing that the

defendant’s reasons lack credibility. Id. A plaintiff is not required to refute each of a

defendant’s rationales for dismissal at the summary judgment stage; rather, if he or she can “cast

substantial doubt on a fair number of them”, the complaint will survive a motion for summary

judgment. Fuentes v. Perskie, 32 F.3d 759, 764 at n.7 (3d 1994). 

Here, the court returns to Raylon’s decision to send an allegedly inadequate employee to a

conference as a corporate representative just prior to her dismissal. It is peculiar that the

company would invite a woman known for unprofessional behavior to dinner with a leading

executive of a major supplier, or that the company would authorize an extended trip for an

employee known to be unable to complete expense reports or to manage corporate credit cards. 

Disconnections between an employer’s alleged dissatisfaction with an employee’s performance

and that employee’s continued access to job-related perks and opportunities are the kind of

inconsistencies that permit quid pro quo harassment claims to survive motions for summary

judgment. See Farrell, 206 F.3d at 285; Pergine v. Penmark Mgmt. Co., Inc. 314 F.Supp. 2d

486, 489 (E.D. Pa. 2004). 

The court recognizes that there are many inferences that might be drawn from the

circumstantial evidence above, but the law requires that the evidence be construed in the light

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most favorable to the non-moving party at the summary judgment stage. Id. at 286. Thus, the

court finds that there are genuine issues of material fact in this case, and defendants’ motion for

summary judgment is DENIED. 

D. Defendant David Craggs’ Argument for Summary Judgment under the PHRA

Craggs made an additional argument, asking the court to dismiss the PHRA claim against

him because, he argues, the plaintiff cannot show that he “aided and abetted” in an unlawful

discriminatory practice. A PHRA claim for aiding and abetting requires that a plaintiff show that

a defendant participated in or compelled discriminatory conduct. Wilson v. Children’s Museum

of Pittsburgh, 2006 U.S. Dist. LEXIS 28978 *7 (W.D. Pa. 2006)(citing Dici v. Commonwealth,

91 F.3d 542 (3d Cir. 1996)). The defendants correctly point out that compelling discriminatory

conduct by another is different than personally committing harassment, and that only the former

is actionable under the PHRA’s aiding and abetting language. Dici, 91 F.3d at 553. However,

Ms. Schepis accuses Mr. Craggs of both harassing her (Compl. ¶ 25) and compelling Raylon to

fire her unlawfully. (Compl. ¶ 34.) Thus, her claim under the PHRA is still viable, and Mr.

Craggs’ motion for summary judgment is DENIED. 

E. Plaintiff Kathleen Schepis’ Motion for Partial Summary Judgment

Schepis seeks a judgment from this court, prior to trial, that she was an employee of both

Raylon and L’Oreal. She grounds this proposition in the working relationship between Raylon

and L’Oreal, and the frequency of her interactions with L’Oreal staff members, who she claims

as additional supervisors. The plaintiff also moves for partial summary judgment on the issue of

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 Notably, at an earlier stage in this litigation the defendants L’Oreal and David Craggs moved the court to 1

dismiss Schepis’ claim, asserting that Schepis could not adequately plead that she was ever a L’Oreal employee. This

court denied the defendants’ motion to dismiss on August 24, 2004, holding that the plaintiff could bring a claim under

Title VII and the PHRA without proving that a direct employment relationship with L’Oreal existed. 

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L”Oreal’s vicarious liability for the behavior of Craggs. Construing all of the facts in favor of

the non-moving party, the court finds that there are genuine issues of material fact concerning the

nature of Schepis’ relationship with L’Oreal; therefore, the plaintiff’s motion for partial summary

judgment on these point is DENIED. 

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There are two theories that can support an employee's claim that she worked for two

employers. The Third Circuit has outlined separate, multi-factor tests to determine whether an

individual is a joint employee of two enterprises, or whether two enterprises function as a single

employer for all intents and purposes. Schepis’ motion for summary judgment does not

explicitly state under which theory she proceeds; however, her motion fails under either theory.

Applying Supreme Court precedent, the Third Circuit stated that joint employers are

those who “share or co-determine those matters governing essential terms and conditions of

employment.” NLRB v. Browning-Ferris Indus., 691 F.2d 1117, 1124 (3d Cir. 1982) (citing

Boire v. Greyhound Corp., 376 U.S. at 481). Among the matters co-determined by joint

employers are employee salaries, employee schedules, forms of supervision, and criteria for

hiring and firing. Id.

In her short discussion of the relationship between Raylon and L’Oreal, Schepis indicates

that she had frequent discussions with L’Oreal employees, and that she conducted workshops at

some salons at L’Oreal’s express request. Schepis further claims that L’Oreal trained her for her

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position, and provided the products and scripts that shaped her work. Nonetheless, the record

does not indicate unambiguously that L’Oreal shared daily supervision of Schepis with Raylon,

participated in her selection or her firing, or helped to set her salary and overall schedule. 

Therefore, the court cannot grant summary judgment on the question of Schepis’ employment

under a joint employer theory. 

Schepis’ motion fares no better under a single employer standard. The Third Circuit

instructs that a “single employer” exists “where two nominally separate entities are actually part

of a single integrated enterprise so that, for all purposes, there is in fact only a ‘single employer.’” 

Id. at 1122. The factors that point to single employer status for two entities include “1)

functional integration of operations; (2) centralized control of labor relations; (3) common

management; and (4) common ownership.” Id. at 1122 (citing Radio Union v. Broadcast Service

of Mobile, 380 U.S. 255, 256 (1965)). Although Raylon and L’Oreal have a thriving business

relationship, the record does not establish that their operations are integrated or their labor

relations centrally controlled; furthermore, the ownership and management teams of the

companies are distinct. Thus, Schepis’ motion for partial summary judgment on the question of

her employment relationship with L’Oreal is DENIED. 

Given that there are still issues of material fact about the plaintiff’s employment

relationship with L’Oreal that require resolution, the court also declines to order that the

defendants are strictly liable to Schepis. Certainly, an employer can be held vicariously liable for

the harassing actions of a supervisor. Faragher v. City of Boca Raton, 524 U.S. 775, 780 (1998). 

But because Schepis has not yet established that she was an employee of L’Oreal or that Craggs

was her supervisor, the court will not enter a premature, partial summary judgment that L’Oreal

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would be vicariously liable for Craggs’ behavior. 

An appropriate order follows. 

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

KATHLEEN SCHEPIS : CIVIL ACTION

 :

: NO. 03-cv-05970

v. :

:

RAYLON CORPORATION, et al. :

AND NOW, this 26 day of September, 2006, upon consideration of the motions for th

summary judgment by defendants Raylon, L’Oreal, and David Craggs, and the motion for partial

summary judgment by plaintiff Kathleen Schepis, it is hereby ORDERED that:

1. The motion for summary filed by defendants L’Oreal USA and David Craggs

(Document # 34) is DENIED;

2. The motion for summary judgment filed by defendant Raylon Corporation (Document

# 35) is DENIED;

3. The motion for partial summary judgment filed by plaintiff Kathleen Schepis

(Document # 33) is DENIED.

BY THE COURT:

 s/s Thomas M. Golden

THOMAS M. GOLDEN, J.

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