Lee v. Riverbay Corporation

Background

James Lee sued Riverbay Corporation, Residential Management Group, LLC doing business as Douglas Elliman Property Management, Noel Ellison, Warren Mitchell, Inelle Cooper, and Robert Klehammer. He alleged employment discrimination based on race, color, and national origin under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 1981, the New York State Human Rights Law, and the New York City Human Rights Law. He also alleged retaliation, hostile work environment, aiding and abetting, interference with protected rights, and supervisory liability.

Lee alleged that Mitchell repeatedly called him “Bruce Lee,” made comments about Korean people and dry-cleaning businesses, and made additional comments about Lee’s appearance, color, and national origin. Lee also alleged that coworkers associated him with COVID-19 because of his Asian heritage. He claimed that supervisors and others failed to take adequate action after he complained. He further alleged that Defendants excluded him from meetings and emails, denied or reduced salary increases, assigned him additional work after a colleague left, and terminated his employment after he filed a charge with the Equal Employment Opportunity Commission.

Defendants moved to dismiss the Amended Complaint under Federal Rule of Civil Procedure 12(b)(6), which tests whether the complaint plausibly states a legal claim. They also moved under Rule 12(f) to strike two paragraphs as privileged and irrelevant.

Rulings on the Corporate Defendants

The court dismissed the Corporate Defendants from the disparate-treatment discrimination claims under Title VII and Section 1981 and from the New York State Human Rights Law claims based on conduct occurring before October 11, 2019. The court also dismissed the remaining disparate-treatment allegations to the extent they were based on meeting and email exclusions, salary increases, the added workload, or termination because the allegations did not provide enough facts connecting those actions to discriminatory intent. The court allowed the New York City Human Rights Law claims, and the post-October 11, 2019 New York State Human Rights Law claims, to proceed to the limited extent they were based on the alleged discriminatory comments directed at Lee. The court dismissed the other portions of those claims.

The Title VII hostile-work-environment claim survived. The court held that Lee plausibly alleged a workplace marked by repeated racial and ethnic comments over several years, including comments by supervisors, despite complaints to management. The related hostile-work-environment claims under the New York State and New York City Human Rights Laws also survived.

The retaliation claims under Title VII, Section 1981, and the New York State Human Rights Law for conduct before October 11, 2019 survived only to the extent they were based on the November and December 2020 salary incidents, the excessive workload in April and May 2022, and Lee’s termination. The court dismissed those claims to the extent they were based on the other alleged conduct. The post-October 11, 2019 New York State Human Rights Law and New York City Human Rights Law retaliation claims also survived as to the alleged post-July 2021 exclusion from meetings and emails, but the court dismissed the claims based on the March 2020 meeting exclusion and the other two alleged salary denials.

The court dismissed the aiding-and-abetting claims against the Corporate Defendants under the New York State and New York City Human Rights Laws. It dismissed the interference-with-protected-rights claim under the New York City Human Rights Law in its entirety. The court allowed the Corporate Defendants to remain subject to the New York City Human Rights Law supervisory-liability claim based on actionable conduct by the Individual Defendants.

Rulings on the Individual Defendants

The court dismissed all Section 1981 claims against the Individual Defendants. It also dismissed all claims against them for discrimination, hostile work environment, and retaliation under the New York State Human Rights Law, as well as the New York City Human Rights Law retaliation claims. The court found that Lee had not adequately alleged that the Individual Defendants knew about the relevant protected complaints or personally participated in the alleged retaliation.

The court allowed Lee’s New York State Human Rights Law aiding-and-abetting claims to proceed insofar as they were based on discrimination and hostile work environment. It dismissed those claims insofar as they were based on retaliation. The court reached the same result for the corresponding New York City Human Rights Law aiding-and-abetting claims. The court also allowed the New York City Human Rights Law discrimination and hostile-work-environment claims to proceed against the Individual Defendants, based on their alleged participation in discriminatory comments or failure to take adequate corrective action.

The court dismissed the New York City Human Rights Law interference claim against all Defendants and dismissed the supervisory-liability claim against the Individual Defendants. It allowed the supervisory-liability claim to proceed against the Corporate Defendants.

Motion to Strike and Further Proceedings

The court denied the motion to strike paragraphs 42 and 43. It concluded that the existing pleadings did not establish at this stage whether the attorney-client privilege applied and that the allegations might be relevant to Lee’s retaliation claims. The denial was without prejudice to renewal.

Chief Judge Laura Taylor Swain granted in part and denied in part Defendants’ motion to dismiss and denied the motion to strike. Lee was granted permission to move for leave to file a second amended complaint within 30 days. The proposed complaint must address the defects identified by the court. If Lee does not timely seek permission to amend, or if the request is denied as futile, the claims dismissed by this Opinion and Order will be dismissed with prejudice.