Marla Montell v. Diversified Clinical Services

757 F.3d 497, 2014 WL 2898525, 2014 U.S. App. LEXIS 12125, 123 Fair Empl. Prac. Cas. (BNA) 786
CourtCourt of Appeals for the Sixth Circuit
DecidedJune 27, 2014
Docket13-6186, 13-6231
StatusPublished
Cited by170 cases

This text of 757 F.3d 497 (Marla Montell v. Diversified Clinical Services) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Marla Montell v. Diversified Clinical Services, 757 F.3d 497, 2014 WL 2898525, 2014 U.S. App. LEXIS 12125, 123 Fair Empl. Prac. Cas. (BNA) 786 (6th Cir. 2014).

Opinions

MOORE, J., delivered the opinion of the court, in which SUHRHEINRICH and WHITE, JJ., joined. SUHRHEINRICH, J. (pgs. 510-11), delivered a separate concurring opinion.

OPINION

KAREN NELSON MOORE, Circuit Judge.

Marla Montell reported an allegation of sexual harassment against her supervisor, Austin Day, to human resources (“HR”) at Diversified Clinical Services, Inc. (“DCS”). The HR representative then contacted Day almost immediately. The next day, Montell alleges, Day called Montell and told her that she should resign or else she would be fired. On the following business day, Montell, feeling threatened and intimidated, resigned.

Montell appeals the district court’s grant of summary judgment for DCS and Day in her suit against them alleging, under Kentucky law, harassment, intentional infliction of emotional distress (“IIED”),1 retaliation, and negligent hiring, supervision, and retention. DCS and Day cross-appeal the district court’s denial of their motion for sanctions against Montell under Rule 11 of the Federal Rules of Civil Procedure and 28 U.S.C. § 1927. Because this case presents a classic genuine issue of material fact as to credibility — whether Montell’s allegations or Day’s denials are to be believed, we REVERSE the district court’s grant of summary judgment as to the retaliation claim. In all other respects, we AFFIRM the district court’s grant of summary judgment. We also AFFIRM the denial of the motion for sanctions.

I. BACKGROUND

Marla Montell served as DCS’s Program Director at the Frankfort Regional Medical Center (“FRMC”). Austin Day was the Area Vice President to whom Montell reported. R. 69-1 (Videotaped Dep. of Donald Austin Day (“Day Dep.”) at 58) (Page ID # 2408). In turn, Day reported to Senior Vice President Michael Tanner. Id. at 58-60 (Page ID # 2408). DCS managed the wound care center at FRMC and derived revenue from: 1) a yearly consulting and management fee paid by FRMC; 2) revenue from hyperbaric oxygen treatments (“HBO treatments”); and 3) wound care revenue paid by patients. Id. at 45-46 (Page ID #2405); R. 68-1 (Videtaped [501]*501Dep. of Michael Tanner (“Tanner Dep.”) at 35-86) (Page ID ## 2303-04).

A. Montell’s Performance

As the Program Director, Montell managed the day-to-day activities of the wound care center, including supervising employees, performing community education, reporting charges to Medicare, overseeing the handling of reimbursements, and meeting with hospital representatives. R. 66-1 (Dep. of Marla Montell (“Montell Dep.”) at 65-66, 72-74) (Page ID ##2018-19, 2025-27); R. 69-1 (Day Dep. at 33-34, 47-55) (Page ID ## 2402, 2400-07). During her time, annual gross revenue of the wound care center increased. R. 34-4 (Ex. 47) (Page ID # 974). On March 30, 2011, Montell received a 2% salary increase. R. 34-6 (Ex. 51) (Page ID # 1061).

Montell, however, also struggled with aspects of her job. For example, the wound care center Montell managed failed to meet performance goals for the first three quarters of 2010. At a management meeting, called a DASH meeting, in October 2010, Montell gave a presentation that was poorly received. According to her supervisor, Day, Montell’s presentation showed a “[cjomplete lack of understanding of what was driving the business, what was behind it, and the root cause of her issues or problems and how to solve them.” R. 69-1 (Day Dep. at 84-85) (Page ID ## 2414-15). Others, including Montell, agreed that her presentation did not go well. R. 66-1 (Montell Dep. at 85) (Page ID # 2039); R. 63-1 (Videotaped Dep. of Belinda Blair (“Blair Dep.”) at 31) (Page ID # 1763); R. 68-1 (Tanner Dep. at 24) (Page ID # 2292). Day placed Montell on a Performance Improvement Plan (“PIP”) on November 9, 2010, that identified knowledge deficits, particularly related to processing Medicare/Medicaid reimbursements for FRMC and analyzing data contained in DOS’s operational reports. R. 34-3 (Ex. 13) (Page ID # 830).

Montell also failed to meet revenue goals, including in the fourth quarter of 2010. R. 69-1 (Day Dep. at 195) (Page ID # 2148). Moreover, despite the PIP, Mon-tell continued to have trouble with the coding for Medicare reimbursement. Id. at 119-27 (Page ID ##2072-80). As a result, Montell received a documented oral counseling and a development plan in March 2011, which focused on the reimbursement issues. R. 34-3 (Exs. 18, 19) (Page ID ## 848-54).

On April 13, 2011, DCS issued Montell a Final Warning, which communicated expectations of Montell, noted a decline in the number of new patients, wound care center treatments, and HBO treatments, and expressed the expectation that the facility should generate increases in new patients (3%), wound care treatments (5%), and HBO treatments (10%). R. 34-4 (Ex. 28) (Page ID ## 882-83). Failure, according to the Final Warning, could result in termination. Id. This Final Warning was amended on May 3, 2011, because of another FRMC complaint regarding the handling of reimbursements. R. 34-4 (Ex. 29) (Page ID ## 886-90). Rather than receive termination, Montell was given additional time to show improvement. R. 69-1 (Day Dep. at 202) (Page ID #2444); R. 68-1 (Tanner Dep. at 83-84) (Page ID ## 2351-52); R. 64-1 (Videotaped Dep. of Megan Lee (“Lee Dep.”) at 30-31) (Page ID ## 1837-38). Pat Wolfe, manager of Medical Billing and Physician Services at DCS, provided additional training to Mon-tell on the reimbursement issues on May 2, 2011; at which point Wolfe stated to Day, “I am comfortable with [MontellJ’s knowledge of the concepts.” R. 34-6 (Ex. 52) (Page ID # 1062). The Amended Final Warning also noted that the metrics were not met for the month of April. R. 34-4 (Ex. 29) (Page ID # 888). Finally, this Amended Final Warning issued on May 3 stated that “[f]rom this point forward, [502]*502[Montell] is operating on a 30 day action plan. If any of the requirements stated above or the requirements previously stated in the Final Warning and the 6 month action plan are not met, termination will be the next step.” Id. There were no complaints regarding Montell’s performance between May 3, 2011, and May 23, 2011. On Thursday, May 19, 2011, Day notified Montell that she had not met her performance bonus goals for the first quarter of 2011. R. 66-1 (Montell Dep. at 195-97) (Page ID ## 2148-50); R. 34-4 (Ex. 31) (Page ID ## 893-94).

B. Montell’s Experience

Montell testified that throughout her time working for Day, he would comment on her appearance at every opportunity. While she first took these comments as compliments, R. 66-1 (Montell Dep. at 148) (Page ID #2101), Day became more aggressive with the comments. For example, Day stated, “[n]othing turns me on more than a woman in a red dress and heels,” while Montell was wearing a red dress and heels. Id. at 146 (Page ID # 2099). He would often preface the comments about his sexual arousal with “[djon’t call HR on me,” or “you can get me in trouble.” Id. According to Montell, these increasingly aggressive comments scared her. Id. at (149-50) (Page ID ## 2102-03). She would attempt to avoid Day’s presence when he would come to the facility. See id. at 147 (Page ID # 2100).

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757 F.3d 497, 2014 WL 2898525, 2014 U.S. App. LEXIS 12125, 123 Fair Empl. Prac. Cas. (BNA) 786, Counsel Stack Legal Research, https://law.counselstack.com/opinion/marla-montell-v-diversified-clinical-services-ca6-2014.