Spain v. Gallegos

• Court: Court of Appeals for the Third Circuit
• Decided: June 16, 1994
• Docket: 93-3467
• Status: Unknown

Opinion

Opinions of the United 1994 Decisions States Court of Appeals for the Third Circuit

6-16-1994

Spain v. Gallegos Precedential or Non-Precedential:

Docket 93-3467

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No. 93-3467

ELLEN V. SPAIN,

Appellant

v.

TONY E. GALLEGOS, CHAIRMAN, EQUAL EMPLOYMENT OPPORTUNITY COMMISSION; UNITED STATES OF AMERICA

On Appeal from the United States District Court for the Western District of Pennsylvania (D.C. Civil No. 92-1403)

Argued May 2, 1994

BEFORE: GREENBERG and GARTH, Circuit Judges, and ROBRENO, District Judge*

(Filed: June 16, 1994)

Stanford A. Segal (argued) Gatz, Cohen, Segal & Koerner 400 Law & Finance Building Pittsburgh, PA 15219

Attorneys for Appellant

James R. Neely, Jr. Deputy General Counsel Gwendolyn Young Reams Associate General Counsel Lorraine C. Davis Assistant General Counsel

1 *Honorable Eduardo C. Robreno, United States District Judge for the Eastern District of Pennsylvania, sitting by designation.

2 John F. Suhre (argued) Attorney Equal Employment Opportunity Commission 1801 L Street, N.W. Washington, D.C. 20507

Attorneys for Appellee

OPINION OF THE COURT

GREENBERG, Circuit Judge.

A female employee of the Equal Employment Opportunity

Commission brings this appeal from orders of the district court

dismissing her action against the EEOC alleging sexual and racial

discrimination, sexual harassment and unlawful retaliation, all

in violation of Title VII of the Civil Rights Act of 1964.

Immediately before the trial, the district court excluded certain

evidence from the appellant's sexual discrimination and

harassment claims and barred her from proceeding with those

claims on the evidence she had intended to offer. Four days

later, after an intervening weekend, the appellant elected not to

proceed with the balance of her case, as she reasoned that the

district court's ruling precluded her from establishing her

remaining claims. In accordance with warnings the district court

had given the appellant, the court then dismissed her case with

prejudice for failure to prosecute, and it assessed her with jury

costs.

The appellant appeals from the district court's

exclusion of the evidence she intended to offer to prove sexual

3 discrimination and harassment, from the court's judgment against

her on those claims on the basis of her proposed evidence, from

the court's dismissal of the balance of her case predicated on

her decision not to go forward, and from the court's imposition

of jury costs against her. We conclude that in the unusual

circumstances presented in her allegations, the appellant has

alleged a prima facie case of sexual discrimination and

harassment and that material issues of fact remain on these

claims for consideration by a jury. We also conclude that the

court abused its discretion in excluding her evidence.

Consequently, we hold that the district court erred in barring

her from proceeding with her sexual discrimination and harassment

claims.

We also hold that the court did not abuse its

discretion in dismissing the balance of her case after she

decided not to go forward with her remaining claims, as it warned

her that it would dismiss these claims if she did not proceed.

However, in light of the significant impact of the court's

initial rulings on the appellant's case and the short interval

between these rulings and the start of trial on the remaining

issues, we hold that the court abused its discretion in assessing

the jury costs against her. Thus, we will reverse the order of

the district court dismissing the appellant's sexual

discrimination and harassment claims and assessing the jury costs

against her, but we will affirm the order of the district court

dismissing the balance of the case.

4 I. BACKGROUND

The appellant, Ellen V. Spain, is an investigator in

the Pittsburgh Area Office of the EEOC.0 Although she was hired

in 1974 by that office, the EEOC promoted her to the position of

director of the Dayton Area Office in 1979, and she held that

position until approximately 1980 or 1981. She then worked

briefly for the Department of Housing and Urban Development

before returning to the EEOC's Pittsburgh office as an

investigator. App. at 75. Spain currently holds a position with

a GS 1810-12, Step 10 Grade.0

In addition to suing the EEOC, Spain originally named

Eugene Nelson and Johnny Butler as defendants, but they have been

dismissed from the action. Nelson and Butler are the director of

the EEOC's Pittsburgh Area Office and the director of the EEOC's

0 The EEOC points out that much of Spain's brief "is devoted to discussion of matter which was not before the district court." Appellee's br. at 3 n.1. Thus, Spain has included depositions in the appendix not presented to the district court. We recognize that ordinarily this procedure could present a problem, as Spain would be expanding the record on appeal. But in the circumstances of this case, we will consider the affidavits and depositions in the appendix because the district court entered judgment for the EEOC on the sexual discrimination and harassment claims in a proceeding equivalent to a hearing on a motion for summary judgment. However, the court did so without advance notice to Spain of the proposed hearing. Thus, Spain had no opportunity to respond to a formal motion by filing answering papers attaching germane portions of affidavits and depositions. Accordingly, fairness requires that we treat the disposition of the sexual discrimination and harassment claims as the functional equivalent of the granting of a motion for summary judgment for the EEOC, and furthermore that we consider all the materials which Spain could have produced in opposition to that motion if given the opportunity. 0 Id. at 2. In the course of this opinion, we refer both to GS and GM level positions in accordance with the parties' briefs.

5 Philadelphia District Office, respectively. Therefore, Butler is

Nelson's superior, and Nelson is Spain's superior. Spain does

not challenge the dismissal of the action as to Nelson and

Butler.

Spain, a white female, alleges that Nelson and Butler,

male African-Americans, have a history of passing over her for

promotions to GM-13 and GM-14 level positions in favor of

allegedly lesser qualified male African-American applicants. Id.

at 2-3. It is undisputed that in 1985, while Spain held a GS-11

position, she unsuccessfully applied for an open GS-12 position,

a rejection that led her to file an internal EEOC complaint

alleging sexual and racial discrimination. Id. at 75-76. Spain

asserts that the events which underlie the present action began

shortly after she filed that complaint.

Spain alleges that Nelson, her superior, induced her

not to proceed with the EEOC complaint by promising that she

would receive the next available promotion, so long as she agreed

to lend him money periodically.0 Spain asserts that because

Nelson intimidated her she agreed to his requests, and she did

obtain the next promotion in early 1986. Id. Spain charges that

Nelson began demanding loans at that time and that he repeated

these demands every four to eight weeks over the next few years.

Id. at 76, 241; appellant's br. at 5. Significantly, EEOC

regulations preclude a superior EEOC official from soliciting and

0 App. at 3-4, 76-77, 238-39; appellant's br. at 5.

6 accepting loans from a subordinate employee. See 29 C.F.R.

§1600.735-203.

The crux of Spain's sexual discrimination and

harassment claims is that over the years rumors developed in the

Pittsburgh office that Spain and Nelson were having an affair,

because his frequent demands for loans led other employees often

to see them together privately in his office, the cafeteria, or

leaving the office.0 Spain charges that because it was improper

for Nelson to solicit the loans, he needed to meet her privately

to ask for loans, to receive the funds, and to pay them back. Id.

at 77. Spain claims that she learned of the rumors during casual

conversations in the office. She alleges that she complained

about the rumors to Nelson approximately four times per year

between 1986 and 1988 and once in 1989 and requested him to put

them to an end. Id. at 230. However, she alleges that the

private meetings and loan requests continued, thereby

perpetuating the rumors. According to Spain, the rumors and

Nelson's continuation of his conduct in the face of the rumors

embarrassed Spain, app. at 231, and caused her co-workers to

ostracize her, thereby straining her relationship with them and

with her supervisors and making her feel miserable and unable to

"deal with the situation." Id. at 77. Spain claims that in late

0 App. at 228-31. Spain's co-worker, Ronald Dean, testified in his deposition that he had heard rumors for some time that Spain and Nelson had a relationship, and he stated that when people would see them together the rumors would escalate. Id. at 167- 70. He also stated that he was told by a co-worker, "Be careful, you don't want to rub Ellen Spain the wrong way, because if you do, then you're going to have problems with the Director" because there was a relationship between the two of them. Id. at 168.

7 1989 or early 1990 she told Nelson that she would no longer lend

him any money. Id. at 78. Spain alleges that this refusal led

Nelson to escalate his harassment, ultimately resulting in her

being denied a promotion as a result of the rumors.

In 1990, Spain unsuccessfully sought a promotion to GM-

13 Supervisory Investigator. Spain contends that in part Nelson

based his decision not to promote her on evaluations by her

supervisors in the office. Appellant's br. at 7. As evidence of

the impact of the false rumors upon her work environment, Spain

points to an affidavit of one of these evaluating supervisors,

Bruce Bagin, stating that he graded Spain low on the "integrity"

category of the evaluation due to his perception of her conduct

with Nelson based on the rumors and his observations. Bagin also

stated that Spain had complained to him about the false rumors

but that he refused to discuss them because his perception of her

conduct seriously had affected his view of her. App. at 80. The

EEOC contests Spain's assertion regarding the basis for its

decision not to promote her and responds that Nelson considered

much evidence assessing her qualifications, including the

negative opinion of her supervisor in the Dayton Area Office.

Appellee's br. at 4-5.

However, Spain offers as evidence a memorandum from

Nelson to his superior, Butler, which discusses the

qualifications of the candidate selected for the promotion, as

well as the reasons why other candidates were not selected. App.

at 374-76. In the memorandum, Nelson states that although Spain

had "outstanding skills in administrative matters" and was

8 "proficient in the technical aspects" of the position, she ranked

dead last among the candidates due to her consistent "inability

to relate effectively with the supervisor, co-workers and

others." App. at 376. The memorandum further explains that

while all of the candidates had "sufficient technical skills to

perform the supervisory job only Ms. Spain is rated so low in

interpersonal relations to cause her to be ranked so low." Id.

(emphasis added). In contrast to Spain's evidence, the EEOC does

not precisely indicate what role the written evaluations of

Spain's Pittsburgh supervisors played in Nelson's decision not to

promote her.

In June 1990, Spain filed a second complaint with the

EEOC, and it is this complaint which directly led to this action

and thus to this appeal. Spain asserts that the retaliatory

conduct began in earnest after she filed this complaint. App. at

253. Moreover, she alleges that Nelson began coming to her house

when she was working at home, and he continued to pressure her to

make loans to him and to drop the new complaint. Id. at 274-80.

On May 6, 1992, the EEOC issued a proposed disposition finding

that there had not been discrimination against Spain. Id. at 12- 14.

On June 8, 1992, Spain filed her complaint in the

district court against the EEOC, Nelson, and Butler. Count I of

the complaint alleges sexual and racial discrimination, sexual

harassment and unlawful retaliation, all in violation of Title

VII of the Civil Rights Act of 1964, and Counts II and III allege

the state law claim of intentional infliction of emotional

9 distress by Nelson and Butler. Id. at 1-10. In her complaint,

Spain claims that she has been subject to retaliation for having

filed prior grievances and that Nelson had stopped speaking to

her and removed certain supervisory functions from her. Id. at

3. Moreover, Spain charges that she has been subject to sexual

discrimination and harassment stemming from "false rumors being

circulated that she was involved in an intimate relationship with

defendant Nelson." Id. Spain also alleges that even though

Nelson knew the rumors were false, he perpetuated them by

continuing his improper loan solicitation and by not taking steps

to prevent the rumors. Instead, according to Spain, he and

Butler, who also knew about the false rumors, used them to deny

her advancement. Id. at 3-4.

In essence, Spain's claims of sexual discrimination and

harassment are traceable to Nelson's alleged conduct, which both

caused and perpetuated the rumors that, in turn, resulted in the

treatment she received from both her co-workers and supervisors.

Spain also claims that there was retaliation against her for

refusing to continue to lend Nelson money, a practice which she

asserts had been instituted because of her sex and race. Id. at 4. In addition to alleging that she was bypassed improperly for

a promotion, Spain claims that Nelson had begun downgrading her

evaluations, and that Butler had rescinded an award due her. Id.

After depositions were taken, Spain's complaint against

Butler was dismissed on November 10, 1992, with her consent. The

United States then filed a Certificate of Substitution of itself

for Nelson as a defendant under 28 U.S.C. § 2679, and the

10 district court permitted the substitution on March 3, 1993.

Thereafter, on April 6, 1993, Spain filed a motion in limine

seeking to exclude evidence that her supervisors in the Dayton

office evaluated her negatively and evidence that she had not

been forthcoming about her education on her employment

application. On April 9, 1993, the EEOC filed a motion in limine

pursuant to Fed. R. Evid. 401-03 to prevent Spain and her

attorney from referring to or offering as evidence any testimony

regarding the alleged loans by Spain to Nelson. On April 12,

1993, Spain agreed to dismiss the United States as a defendant.

Thus, as Nelson and Butler were no longer parties, the case went

forward solely against the EEOC.

On Thursday, July 15, 1993, the day set for jury

selection, the district court ruled sua sponte that it would not

permit Spain to proceed with her claims of discrimination based

on a sexually hostile working environment. In reaching this

conclusion the court held that Spain could not base her claims on

Nelson's failure to stop the false rumors in the workplace that

he and Spain were having an affair. The court reached this

decision despite Spain's allegations that the rumors caused her

to be shunned by her co-workers and to be evaluated poorly for

promotion purposes by her supervisors with respect to her

integrity and ability to work with others. App. at 29-40. When

the court asked Spain's attorney what type of evidence she

intended to present to establish the sexual harassment claim, he

replied that he would point to "the failure of the superior[s] to

11 put an end [to] the rumors when they knew about them." Id. at

30. The district court then responded: I don't think that's recognizable under Title VII. I don't know that an individual who has had no relationship with someone has to embarrass himself by going forward and denying such a relationship just because some other person wants him to do that . . . . And I am not going to let you proceed on that, if that is the basis of that claim.

Id. at 31. Spain's attorney then remarked that "[i]t is clearly

the basis of the claim" and that he could not "present the case

without the testimony of the rumors." Id.

Spain then attempted to argue orally that the case

should be viewed as similar to Jew v. University of Iowa, 749 F.

Supp. 946 (S.D. Iowa 1990). App. at 34-39. The court in Jew

found that there was a sexually hostile work environment where

there were rumors that a female professor and her male superior

were having an affair, and other faculty members in the position

of evaluating her for promotion purposes spread the rumors and

conducted a campaign of open slander and innuendo of a sexual

nature against her.

However, the district court, agreeing with the EEOC's

attorney, distinguished Jew on several grounds. The court first

stated that in Jew, unlike in this case, the supervisor was

spreading the rumors.0 The court then asked Spain's attorney how

0 Actually nothing in Jew indicates that the supervisor was spreading the rumors. On the other hand, Spain argues that Nelson created the conditions in which the rumors developed and then did nothing to stop them after being informed of them, and even continued the conduct which resulted in the rumors being perpetuated.

12 the rumors could have been corrected without Nelson telling

people that he was not having an affair with Spain. Id. at 34-

35. The attorney responded that Title VII requires a supervisor

on notice of sexual harassment to take corrective action promptly

and that Nelson or Butler could have told the concerned employees

that the rumors were false. Id. In response, the EEOC's

attorney argued that the obligation to correct a hostile work

environment presupposes that the employer has notice of the

environment, and that there was no evidence that Spain complained

to Butler about the rumors or evidence that Butler was otherwise

on notice of the situation.0

The court then asked Spain what evidence she had that

the comments made to her created a hostile environment. Id. at

36. Spain responded that she was treated as an outcast by other

employees, and she proffered testimony that a co-worker had

warned another employee to stay away from Spain because she was

the "boss' lover." Id.; see note 4, supra. The attorney for the

EEOC responded that the testimony was that Spain had "got the

boss' ear and [would] get you into trouble, which is not the same

thing." Id. However, Spain disputed the EEOC's recollection of

the co-worker's testimony.

The district court then distinguished Jew on the ground

that the rumors in that case were that the professor was having

an affair with her supervisor and was using the sexual

relationship to gain favor, influence and power with her

0 App. at 35-36. Butler has admitted being asked about the rumors by the employees. App. at 340.

13 superior. The court asked Spain whether she had similar

evidence. Id. at 36-37. Spain's attorney replied that the EEOC

also denied Spain the promotion because she had poor

interpersonal relationships with her co-employees. Id. at 37.

The EEOC then argued, and the court agreed, that in Jew there was

additional evidence of open harassment on the basis of sex in the

form of cartoons and in other ways. Spain responded that her

supervisors evaluated her negatively with respect to integrity

because of the rumors about the affair. Id. at 38.

At first, the district court stated that it would allow

evidence supporting these allegations inasmuch as a failure to

promote due to the rumors had "a sexual connection." Id. at 39.

However, on reconsideration, the court concluded that the poor

ratings related to sexual activity and not gender. Consequently,

the court ruled that the evidence could not be admitted unless

there was evidence that males who did the same thing were treated

differently. Id. at 44.

The court thus held that Title VII does not require

that a supervisor deny rumors that he is having an affair with a

subordinate. Therefore, the district court barred Spain from

proceeding on her sexual discrimination and harassment claims

based on the evidence she intended to offer. This ruling

effectively granted summary judgment to the EEOC on these claims,

and accordingly we review the case as if the court formally

granted summary judgment.0

0 See note 1, supra.

14 The district court also ruled on the motions in limine.

It denied Spain's motion but granted the EEOC's motion to exclude

any evidence regarding whether Nelson solicited and accepted

loans from Spain. Id. at 40-43. In opposition to the motion,

Spain argued that the private meetings at which Nelson obtained

the loans were the source of the false rumors that they were

having a relationship and that Nelson could have stopped the

rumors by ceasing to meet with Spain to borrow money. Id. at 42-

43. However, the court found no evidentiary value in the fact

that "other people interpreted meetings . . . in the wrong way."

Id.

As the district court prepared to adjourn, Spain's

attorney asked whether taking a voluntary non-suit based on the

court's ruling would eliminate her appeals. The court responded

in the affirmative with respect to the issues on which Spain

still was able to proceed. Id. at 45. The court stated that

reversal of its ruling regarding the rumor-based sexual

discrimination and harassment claims would permit Spain to try

those claims, but reversal would not revive her remaining claims.

Id. at 45-46. Moreover, the court and Spain's attorney discussed

the fact that the evidentiary rulings regarding the sexual

discrimination and harassment claims had no bearing on the

remaining claims of racial discrimination and retaliation.0

Four days later, on Monday, July 19, 1993, as the

0 Id. at 46-47. While district courts are entitled to their opinions as to what is and is not appealable, and what are the likely consequences of an appellate decision, these views do not bind a court of appeals.

15 parties were about to start the trial on the remaining claims,

Spain's attorney again suggested that Spain might not continue

with the litigation. The court then warned him that if Spain did

not proceed on her remaining claims, it would dismiss her case

with prejudice for failure to prosecute. App. at 51. Noting the

court's intentions, Spain then declared her decision not to

proceed with the remaining allegations regarding failure to

promote on the basis of race, failure to promote in retaliation

for filing prior EEOC charges, and retaliation for filing this

suit. App. at 52. The district court then followed through with

its warnings and dismissed Spain's case. Furthermore, the court

found that Spain could have advised the court of her decision not

to proceed during the previous three days. Accordingly, it taxed

the $375 costs of the jury against Spain. App. at 52-54.

Spain then appealed. The district court had

jurisdiction under 28 U.S.C. §§ 1331, 1343, and we have

jurisdiction under 28 U.S.C. § 1291.0

0 In our review of the record, we noted that there is some question as to whether we have jurisdiction. The problem derives from the fact that the district court's orders in effect granting summary judgment to the EEOC on Spain's sexual harassment and discrimination claims, excluding evidence from her case, dismissing her case for failure to prosecute, and assessing the jury costs against her were issued orally from the bench and not reduced to writing. This omission raises the question whether the district court has entered a final order for the purposes of 28 U.S.C. § 1291, inasmuch as it did not enter an order in a separate document pursuant to Fed. R. Civ. P. 58. See Bankers Trust Co. v. Mallis, 435 U.S. 381, 387-88, 98 S.Ct. 1117, 1121 (1978); Temple Univ. v. White, 941 F.2d 201, 216 (3d Cir. 1991), cert. denied, 112 S.Ct. 873 (1992). Yet, as in Bankers Trust, the district court clearly intended that its dismissal of the case would be its final decision, as the court designated the transcript as the order of

16 II. DISCUSSION

A. Sex-Based Title VII Claims

We first address the district court's grant of summary

judgment against Spain on her Title VII claims, including the

rejection of her promotion application, arising from a sexually

hostile working environment. Inasmuch as the court in effect

granted summary judgment against her, our standard of review is

plenary. Thus, [we] review the district court's summary judgment determination de novo, applying the same standard as the district court . . . . [I]n all cases summary judgment should be granted if, after drawing all reasonable inferences from the underlying facts in the light most favorable to the non-moving party, the court concludes that there is no genuine issue of material fact to be resolved at trial and the moving party is entitled to judgment as a matter of law. Where the movant has produced evidence in support of its motion for summary judgment, the nonmovant cannot rest on the allegations of pleadings and must do more than create some metaphysical doubt.

Petruzzi's IGA Supermarkets, Inc. v. Darling-Delaware Co., 998

F.2d 1224, 1230 (3d Cir.), cert. denied, 114 S.Ct. 554 (1993).

the court, and the judgment of dismissal was recorded on the clerk's docket. App. at XII, 55. The transcript of the proceeding in which the court entered summary judgment on Spain's claim also was entered on the docket, although we believe that a typographical error was made regarding the date of the proceeding, as it records that the session took place on Sunday rather than on Thursday. App. at XI. In light of Bankers Trust, we thus conclude that we have jurisdiction over the appeal pursuant to 28 U.S.C. § 1291, as no objection was made to the taking of the appeal, and the parties, therefore, are deemed to have waived the separate-judgment requirement of Rule 58. 435 U.S. at 387-88, 98 S.Ct. at 1121.

17 Spain argues that the district court erred in preventing her from

proceeding with her claims because she proffered evidence to

support a case of sexual discrimination and harassment under

Title VII. Comparing her situation to that of the plaintiff in

Jew, and arguing that the district court erred in distinguishing

that case, Spain argues that she belongs to a protected group,

she was harassed and discriminated against because of her sex,

the harassment affected a term or condition of employment, and

the EEOC knew about the harassment but failed to take appropriate

corrective action. Appellant's br. at 18-19.

Title VII of the Civil Rights Act of 1964 makes it "an

unlawful employment practice for an employer . . . to

discriminate against any individual with respect to his

compensation, terms, conditions or privileges of employment

because of such individual's race, color, religion, sex or

national origin." 42 U.S.C. § 2000e-2(a)(1). Recently, the

Supreme Court in Harris v. Forklift Sys., Inc., 114 S.Ct. 367

(1993), discussed the foundation of a sexually hostile work

environment claim: As we made clear in Meritor Savings Bank v. Vinson, 477 U.S. 57, 106 S.Ct. 2399, 91 L.Ed.2d 49 (1986), this language 'is not limited to "economic" or "tangible" discrimination. The phrase "terms, conditions, or privileges of employment" evinces a congressional intent "to strike at the entire spectrum of disparate treatment of men and women" in employment,' which includes requiring people to work in a discriminatorily hostile or abusive environment. Id., at 64, 106 S.Ct., at 2404, quoting Los Angeles Dept. of Water and Power v. Manhart, 435 U.S. 702, 707, n. 13, 98

18 S.Ct. 1370, 1374, 55 L.Ed.2d 657 (1978) (some internal quotation marks omitted). When the workplace is permeated with 'discriminatory intimidation, ridicule, and insult,' 477 U.S., at 65, 106 S.Ct., at 2405, that is 'sufficiently severe or pervasive to alter the conditions of the victim's employment and create an abusive working environment,' id., at 67, 106 S.Ct., at 2405 (internal brackets and quotation marks omitted), Title VII is violated.

Harris, 114 S.Ct. at 370. Furthermore, the Court stated that to

determine whether an environment is "hostile" or "abusive" a

court must look at "all the circumstances." Id. at 371.

In Andrews v. Philadelphia, 895 F.2d 1469 (3d Cir.

1990), we discussed the requirements for establishing a claim

predicated on a sexually hostile work environment: [F]ive constituents must converge to bring a successful claim for a sexually hostile work environment under Title VII: (1) the employees suffered intentional discrimination because of their sex, (2) the discrimination was pervasive and regular, (3) the discrimination detrimentally affected the plaintiff, (4) the discrimination would detrimentally affect a reasonable person of the same sex in that position; and (5) the existence of respondeat superior liability.

895 F.2d at 1482 (footnote and citations omitted). As we noted,

"these factors include both a subjective standard (No. 3) and an

objective standard (No. 4)."0 Since our decision in Andrews, the

Supreme Court in Harris has affirmed that a hostile work

0 Id. at 1483. We further explained: "The subjective factor is crucial because it demonstrates that the alleged conduct injured this particular plaintiff giving her a claim for judicial relief. The objective factor, however, is the more critical for it is here that the finder of fact must actually determine whether the work environment is sexually hostile." Id.

19 environment claim must involve both subjective and objective harm

to the employee.0

In this case, Spain asserts that the harassment she

suffered led to her work environment being sexually hostile and

to the denial of a promotion. Quite clearly, she presents an

atypical sexually hostile work environment claim in that the

alleged wrongful conduct does not include the type of blatantly

sexist behavior that is frequently the hallmark of such claims.

For example, this case differs from Meritor Sav. Bank v. Vinson,

477 U.S. 57, 60, 106 S.Ct. 2399, 2402 (1986), in which an

employee testified that her employer "fondled her in front of

other employees, followed her into the women's restroom when she

went there alone, exposed himself to her, and even forcibly raped

her on several occasions." See also King v. Hillen, No. 92-3601,

1994 U.S. App. LEXIS 7124, at *3 (2d Cir. Apr. 13, 1994). But an

employee can demonstrate that there is a sexually hostile work

environment without proving blatant sexual misconduct. Indeed,

in commenting on the Andrews elements, we noted that the intent

0 In Harris, 114 S.Ct. at 370, the Court explained:

Conduct that is not severe or pervasive enough to create an objectively hostile or abusive work environment -- an environment that a reasonable person would find hostile or abusive -- is beyond Title VII's purview. Likewise, if the victim does not subjectively perceive the environment to be abusive, the conduct has not actually altered the conditions of the victim's employment, and there is no Title VII violation.

20 to discriminate on the basis of sex could be demonstrated through

actions which "are not sexual by their very nature," although we

stated that a more fact intensive analysis would be necessary in

such a case. Andrews, 895 F.2d at 1482 n.3.

Consequently, we recount Spain's allegations and

evidence thereof and then consider them in light of the elements

of a sexually hostile work environment claim under Andrews.0 As

we discuss above, Spain charges that she was the subject of false

rumors that she was having a sexual relationship with Nelson and

had gained influence over him as a result of their relationship.

These rumors developed among her co-workers because they often

saw her and Nelson in private meetings. However, these meetings

allegedly resulted from Nelson's improper solicitation of loans,

a practice which lasted for several years after Nelson initiated

it.

Spain charges that as a result her work environment was

affected in essentially five ways. First, she was subjected to

the spreading of false rumors about her sexual affairs that

impugned the integrity of her job performance. The very

existence of the rumors caused Spain embarrassment. Second, due

to the rumored sexual relationship, Spain's co-workers allegedly

treated her like an outcast, leading to poor interpersonal

relationships between herself and them, and causing Spain to feel

miserable. Third, the rumors and the resulting poor

0 We note that while we evaluate Spain's allegations under the Andrews standards, the district court seems to have based its ruling primarily on its interpretation of Jew.

21 interpersonal relationships at work led supervisory personnel to

evaluate Spain negatively for advancement purposes. Spain

proffered testimony from a co-worker and a supervisor regarding

the rumors and these effects on her and on her environment.

Fourth, Spain alleges that Nelson knowingly exacerbated the

situation. After creating the conditions in which the rumors

developed, Nelson perpetuated the rumors by continuing to demand

loans from Spain and to meet with her privately for this purpose,

even after Spain informed him of the rumors and asked him to stop

them. Finally, Spain contends that Nelson denied her a promotion

in 1990 based on the rumors and the resulting effects they had

upon her interpersonal relationships at work and her evaluations

by her supervisors. She offered evidence as well to support this

contention.

The first element of a hostile work environment claim

under Andrews is that the employee have suffered intentional

discrimination because of her sex. 895 F.2d at 1482. Spain's

charge that she suffered such discrimination can withstand a

motion for summary judgment as to this element. We have just

recounted Spain's contentions and the evidence she offered to

prove them concerning the rumors and their multiple effects upon

her environment and advancement. We find that the first Andrews element is satisfied because the crux of the rumors and their

impact upon Spain is that Spain, a female, subordinate employee,

had a sexual relationship with her male superior. Unfortunately,

traditional negative stereotypes regarding the relationship

between the advancement of women in the workplace and their

22 sexual behavior stubbornly persist in our society. Because we

are cognizant that these stereotypes may cause superiors and co-

workers to treat women in the workplace differently from men, we

find that a reasonable jury could conclude that Spain suffered

the effects she alleges because she was a woman. Consequently,

Spain has made "out a case under Title VII" by showing "that

gender [was] a substantial factor in the discrimination, and that

if [Spain] had been a man she would not have been treated in the

same manner." Andrews, 895 F.2d at 1485 (internal quotation

marks omitted).

We note that there is no suggestion in the record that

males who worked with Nelson were harassed similarly. However,

the district court erred in requiring Spain to produce evidence

that males in a similar position were treated differently. A

jury reasonably could conclude that if Spain had been a male,

rumors would not have started that she had gained influence with

Nelson through physically using her sex, particularly the ability

to create problems for a fellow employee who "rubbed her the

wrong way."0 Our discussion above leads us to believe that even

if a male had a relationship bringing him into repeated close

contact with Nelson, it would have been less likely for co-

workers to have believed that the relationship had a sexual

basis. Thus, the resulting poor interpersonal relationships,

negative evaluations, and denial of advancement might not have

occurred for a male as they allegedly did for Spain, inasmuch as

0 Spain's co-worker, Ronald Dean, testified that he had been warned not to rub Spain the wrong way. See app. at 168.

23 the situation which caused them simply would not have been

created. Furthermore, while it is true that the rumors also

implicated Nelson, the rumors did not suggest that his

involvement in the alleged relationship had brought him

additional power in the workplace over his fellow employees, and

the employees had no reason for resenting him in the way they did

Spain. Accordingly, he did not have to endure a hostile working

environment brought about due to his sex.

In addition, Spain's allegations that Nelson's improper

conduct first created the conditions under which the rumors

developed and then perpetuated them distinguishes Spain's claims

from claims in other scenarios which might not support a sexually

hostile work environment cause of action. See King v. Hillen,

1994 U.S. App. LEXIS 7124 at *35. Thus, this is not a case in

which the rumors concerned the behavior of a co-worker outside of

the workplace, or in which rumors developed as the result of

other employees' misperception of a supervisor's and an

employee's frequent but necessary, job-related interaction.

Rather, here there are factual questions for trial of whether the

rumors developed and persisted as a result of Nelson's improper

behavior. As in Jew, the situation here was "not merely one of idle gossip about an alleged office romance." 749 F. Supp. at

959. Consequently, Spain properly has alleged, and supported

with materials developed in discovery, that the rumors directed

at her and her resulting ostracization and adverse evaluation for

advancement purposes were both sex-based and intentional.

24 In reaching our conclusion on this point we have paid

particular attention to the distinction we drew in Andrews

between sexual misconduct in which the intent to discriminate "is

implicit, and thus should be recognized as a matter of course"

and "actions [which] are not sexual by their very nature." 895

F.2d at 1482 n.3. Thus, an employer by its conduct might create

conditions which all its employees, without regard for sex,

reasonably consider as harassing and yet the employer would not

discriminate on the basis of sex. Accordingly, where an employee

claims sex discrimination predicated on sexually neutral conduct

it may be necessary for the employee to establish that the

employer's motives for its actions were sexual. If the

discrimination of which Spain complained was predicated merely on

the demands for loans, her case might be of that nature.

However, Spain's allegations are not predicated on

sexually neutral conduct. Rather, she alleges that the

harassment resulted from the rumors that she was having an affair

with Nelson. Thus, the harassment directed against her as a

woman had a sexual orientation by its very nature. Overall, we

are satisfied that Spain has offered evidence that she suffered

intentional discrimination because of sex.

The second requirement for demonstrating a sexually

hostile work environment is that the discrimination must have

been pervasive and regular. Andrews, 895 F.2d at 1482. In

determining that Spain's claim can withstand a motion for summary

judgment as to this Andrews element, we note that she has alleged that the rumors developed over a period of several years between

25 1986 and 1990 and manifested themselves through her continuous

interaction with her colleagues and supervisors. Moreover,

Nelson's loan solicitations and the private meetings allegedly

occurred throughout this time, continuing in particular after

Spain had asked him to put an end to the rumors. Therefore,

there is a fact question for trial as to the pervasiveness and

regularity of Nelson's conduct and the impact of the rumors on

Spain.0

Third, the discrimination must have affected Spain

detrimentally, the subjective requirement of Andrews, as later

recognized in Harris. As we discuss above, Spain has contended

that she perceived herself to be subject to an abusive

environment as manifested through her co-workers' and

supervisors' interaction with her. Thus, determination of the

particular effect of the rumors on Spain is another question of

fact for the jury.

Under Andrews, the fourth requirement to demonstrate a

sexually hostile work environment is that the discrimination must

be such that it would have detrimentally affected a reasonable

person of the same sex in Spain's position. The Supreme Court

explained this requirement in Harris: "Conduct that is not

severe or pervasive enough to create an objectively hostile or

0 We recognized in Bouton v. BMW of N.Am., Inc., No. 93-5296, slip op. at 5 n.2 (3d Cir. June 10, 1994), that the Andrews requirement that the discrimination be "pervasive and regular" differs slightly in form from the Supreme Court's statement in Meritor Sav. Bank, 477 U.S. at 67, 106 S.Ct. at 2405, that the discrimination be "severe or pervasive." Regardless of whether the two formulations substantively differ, both have been met here for summary judgment purposes.

26 abusive work environment -- an environment that a reasonable

person would find hostile or abusive -- is beyond Title VII's

purview." 114 S.Ct. at 370. In Harris, the Court held that

under Title VII conduct can be actionable as harassment creating

a sexually hostile work environment, even though it does not

affect seriously an employee's well-being or lead the employee to

suffer injury. Id. at 370-71. Spain has alleged that she faced

an environment in which her co-workers treated her as an outcast

and in which her supervisors evaluated her negatively for

advancement. Thus, the alleged workplace hostility manifested

itself both in the immediate interaction between Spain and her

colleagues and in connection with her consideration for a

promotion in 1990.

We recognize, of course, that, as the EEOC points out,

Title VII does not require fellow workers to socialize with an

employee they dislike. Appellee's br. at 11 n.6. However, we

must accept Spain's allegations and draw inferences from them in

her favor, and Spain has alleged more than that her co-workers

disliked her. She has presented proof of injury directly flowing

from the sexually hostile work environment. Consequently, we

find that there is a factual question of whether a reasonable

person in Spain's position would have been affected detrimentally

by the environment she faced.

In Andrews, the final factor for determining whether

there was a sexually hostile work environment is the existence of

respondeat superior liability:

27 '[L]iability exists where the defendant knew or should have known of the harassment and failed to take prompt remedial action.' Steele v. Offshore Shipbuilding, Inc., 867 F.2d 1311, 1316 (11th Cir. 1989); see Hicks v. Gates Rubber [Co., 833 F.2d 1406, 1418 (10th Cir. 1987)]. Thus, if a plaintiff proves that management-level employees had actual or constructive knowledge about the existence of a sexually hostile environment and failed to take prompt and adequate remedial action, the employer will be liable. Katz v. Dole, 709 F.2d [251, 255 (4th Cir. 1983)].

895 F.2d at 1486. See also Bouton v. BMW of N. Am., No. 93-5296,

slip. op at 4-13 (3d Cir. June 10, 1994). Spain contends that

the EEOC took no action to stop the harassment even though

managers at three levels recognized the situation she faced:

Butler, app. at 340, Nelson, app. at 120, 125, and Spain's

immediate supervisor, Bruce Bagin, app. at 80. In particular,

she charges that she informed Nelson of the rumors and asked him

to put an end to them, app. at 77, 230, but that he did nothing.

App. at 121. Therefore, Spain's allegations and evidence of her

superiors' knowledge of the environment and their indifference to

it are sufficient to withstand a motion for summary judgment as

to this element of her claim.

In its ruling, the district court stated that Title VII

does not require a supervisor who is the object of a rumored

affair between himself and a subordinate to "embarrass himself"

by denying the rumors. App. at 31. Yet, without further

qualification or explanation, this statement is too broad. As we

already have indicated, if the employer knows of the harassment,

it is obligated to take prompt remedial action. We do not

28 suggest that Title VII required that Nelson personally deny the

rumors. However, assuming that Spain's allegations regarding the

rumors are true, the law did require management personnel to take

remedial action. Accordingly, we hold that the district court

erred in granting summary judgment to the EEOC predicated on the

court's interpretation of the EEOC's obligation under Title VII.

Overall, we think that it is clear that Spain has established the

requirements for a claim of a sexually hostile work environment

under Andrews, and that material issues of fact remain for trial.

Thus, the district court erred in barring Spain from going

forward based on the evidence she intended to offer to prove

these claims.

While we have predicated our result on Andrews and

Harris, we nevertheless will discuss Jew, as it seems to be the

only reported case dealing with circumstances similar to those

here. The district court first distinguished Jew on the grounds

that the supervisor in this case, Nelson, was not involved in

spreading the rumors and was, in fact, an object of them. App.

at 34. However, as Spain points out, Jew does not suggest that

the supervisor in that case was involved in spreading the rumors,

nor did Jew rely on such a consideration. Furthermore, on the

record, it could be concluded that Nelson personally was involved

in spreading the rumors due to his alleged involvement in

creating the conditions under which they developed and were

perpetuated, and due also to his refusal to take steps to end

them. Thus, with respect to this aspect of the district court's

ruling, it appears that the court seized upon a nonexistent

29 distinction between this case and Jew and then applied it

improperly to Spain's allegations.

The district court also pointed out that in Jew the

rumors suggested that the plaintiff had used a sexual

relationship to gain favor, influence and power with an

administrative superior. Accordingly, the court asked Spain what

evidence there was of that type of situation here.0 Yet, in so

asking, the court ignored Spain's offer of testimony by a co-

worker that another employee warned him to stay away from Spain

because she could get him in trouble with Nelson due to her

relationship with him. Id. at 35-36 (court proceeding of July

15, 1993); id. at 168 (deposition testimony). Thus, there was

evidence that the rumors alleged that Spain had attained

influence with Nelson through the use of a sexual relationship.

As we recount above, however, the attorney for the EEOC

argued that this testimony regarding Spain's alleged influence

was based upon her having the "boss' ears," as opposed to their

having a sexual relationship. Id. at 36. Yet, the record

indicates that the EEOC's recollection of the co-worker's

testimony was incomplete, in that the co-worker testified to the

relationship between Spain and Nelson as the reason for Spain's

potential influence over other employees before further

explaining that Spain had Nelson's "ears." Id. at 168. Therefore, the district court erred to the extent that it may

0 App. at 36-37. It was on this ground that the district court in Jew found that the plaintiff was subject to sex-based harassment even though the male superior was also the object of the rumors.

30 have accepted the EEOC's account of the co-worker's testimony in

determining that Spain did not allege that the rumors involved

her use of a sexual relationship to attain influence.

Furthermore, Spain offered evidence that a supervisor rated her

poorly for advancement purposes on account of the rumors and her

resulting poor interpersonal relationships. Thus, there was an

additional reason for the court not to have distinguished Jew on

the grounds that the plaintiff in that case used a sexual

relationship to her advantage.0

Finally, while the district court correctly pointed out

that this case does not involve allegations of overt sexual

harassment, such as the posting of cartoons and the other

activities described in Jew, we have noted that "[i]ntimidation

and hostility toward women because they are women can obviously

result from conduct other than explicit sexual advances."

Andrews, 895 F.2d at 1485 (quoting Hall v. Gus Constr. Co., 842

F.2d 1010, 1014 (8th Cir. 1988)). It would have been erroneous,

therefore, for the district court to have barred Spain from going

forward on the grounds that she had not alleged overt instances

of harassment equivalent to those in Jew.

0 App. at 37-40. Although the district court initially determined that it would allow such evidence, it later changed its decision on the ground that the poor ratings had to do with sexual activity and not gender. Id. at 39, 44. The EEOC argues that the court's exclusion of this evidence was proper because Spain claims that she was denied the promotion on account of her race but not due to her sex. Appellee's br. at 14 n.8. However, Spain's complaint and her argument before the district court clearly were that she was subject to a sexually hostile work environment and denied a promotion on account of her sex. See id. at 1-6 (complaint), app. at 37-40 (trial transcript).

31 In sum, our analysis of the requirements of Title VII

leads us to hold that the district court erred in barring Spain

from proceeding with her sexual discrimination and harassment

claims. Spain has presented evidence that she was subjected to a

sexually hostile work environment in the form of rumors among her

colleagues that she was involved in a sexual relationship with

her superior. These rumors allegedly developed and continued due

to the superior's conduct. Moreover, they allegedly led her

fellow employees to shun her and her supervisors to evaluate her

poorly for advancement purposes. Furthermore, the management

personnel did not take remedial action to eliminate the rumors.

We are satisfied that considering all the circumstances, and

given Spain's unique allegations, she should be allowed the

opportunity to prove her claims regarding the sexually hostile

work environment she allegedly faced.

B. Evidentiary Rulings

We now turn to the district court's exclusion of

Spain's evidence in support of her sexual discrimination and

harassment claims, a ruling made in conjunction with the court's

decision to prohibit Spain from proceeding with her claims. While

we ordinarily would review an evidentiary ruling before making a

substantive decision depending on whether evidence was admitted,

we have reversed that order because our discussion of the

substance of the sexual discrimination and harassment claims has

cast light on the evidentiary question. We review the district

court's admissibility ruling under an abuse of discretion

32 standard, as we are concerned with an issue of the application of

rather than the interpretation of the Federal Rules of Evidence.

United States v. Console, 13 F.3d 641, 656 (3d Cir. 1993), cert.

denied, 128 L.Ed.2d 377, 62 U.S.L.W. 3722 (1994); Petruzzi's IGA

Supermarkets, 998 F.2d at 1237.

The EEOC's motion in limine sought to exclude evidence

concerning Nelson's alleged solicitation and acceptance of loans

from Spain on the grounds: (1) that such evidence was not

relevant to Spain's Title VII action under Rule 401, and

therefore was inadmissible under Rule 402; and (2) that under

Rule 403 the probative value of the evidence was outweighed

substantially by the danger it might lead to unfair prejudice,

confusion of the issues, and delay. App. at 56-62. The district

court granted the EEOC's motion, stating simply: "So what? If

other people interpreted meetings that he had for some other

reason in the wrong way, so what?" Id. at 42-43. Although it

would thus appear that the district court excluded the evidence

on relevancy grounds pursuant to Rule 402, the district court's

ruling is ambiguous, and the parties base their arguments on both

Rule 402 and Rule 403. Consequently, we will consider the

admissibility standards of Rules 401 and 402, as well as the

prejudice standards of Rule 403, as we believe that under either

of these standards, the district court abused its discretion in

excluding the evidence in question.

1. Relevance

33 We recently discussed Rule 401 and the standards for

excluding evidence on relevancy grounds: Under Fed. R. Evid. 401, evidence is relevant if it has 'any tendency to make the existence of any fact that is of consequence to the determination of the action more probable or less probable than it would be without the evidence.' As noted in the Advisory Committee's Note to Rule 401, '[r]elevancy is not an inherent characteristic of any item of evidence but exists only as a relation between an item of evidence and a matter properly provable in the case.' Because the rule makes evidence relevant 'if it has any tendency to prove a consequential fact, it follows that evidence is irrelevant only when it has no tendency to prove the fact.' 22 Charles A. Wright & Kenneth W. Graham, Jr., Federal Practice and Procedure: Evidence § 5166, at 74 n. 47 (1978) (emphasis added). Thus the rule, while giving judges great freedom to admit evidence, diminishes substantially their authority to exclude evidence as irrelevant. Id. § 5166, at 74. Blancha v. Raymark Indus., 972 F.2d 507, 514 (3d Cir. 1992).

The EEOC argues that the district court correctly

excluded the evidence as irrelevant, inasmuch as evidence

concerning the reason for the meetings between Spain and Nelson and the resulting rumors does not tend to prove or disprove

Spain's allegations regarding the rumors and that she was

subjected to sexual harassment as a result. Appellee's br. at

15-16. The EEOC contends that even under Spain's view of the

case, the occurrence of the meetings with Nelson, but not the

reasons for the meetings, is significant. Id. at 16.

Yet, it is clear that evidence concerning the reasons

for the private meetings between Nelson and Spain had a tendency

34 to prove certain elements of Spain's claims, for the evidence

demonstrated why Nelson would have wanted private meetings, as

the EEOC regulations prohibited him from borrowing money from

subordinates. Furthermore, the reasons for the meetings tend to

demonstrate why they were so frequent. More importantly, if a

jury knew the reason for the meetings, it would gain insight into

the credibility of Spain's contention that Nelson did not take

any steps to stop the rumors or initiate any other remedial

actions after learning about the rumors, for remedial action

might have required him to explain his conduct. Consequently,

the evidence is relevant to prove that Nelson was at least

partially responsible for the development and perpetuation of the

false rumors. Inasmuch as under Harris all the germane

circumstances should be considered in an evaluation of Spain's

sexually hostile work environment claim, we believe that the

district court abused its discretion in ruling that the evidence

was inadmissible under Rules 401 and 402.

2. Unfair Prejudice

In Blancha, we also discussed Rule 403 and the standards for excluding evidence that substantially is more

prejudicial than probative: Fed. R. Evid. 403 states that evidence, even if relevant, may be excluded 'if its probative value is substantially outweighed by the danger of unfair prejudice, confusion of the issues, or misleading the jury.' Thus evidence may be excluded when its admission would lead to litigation of collateral issues, thereby creating a side issue which might distract the jury from the main issues.

35 United States v. Dennis, 625 F.2d 782, 797 (8th Cir. 1980). . . . Evidence should be excluded under Rule 403 only sparingly since the evidence excluded is concededly probative. United States v. Terzado-Madruga, 897 F.2d 1099, 1117 (11th Cir. 1990). The balance under the rule should be struck in favor of admissibility. Id.; Dennis, 625 F.2d at 797 (8th Cir. 1980). Finally, we note that in determining the probative value of evidence under Rule 403, 'we must consider not only the extent to which it tends to demonstrate the proposition which it has been admitted to prove, but also the extent to which that proposition was directly at issue in the case.' United States v. Herman, 589 F.2d 1191, 1198 (3d Cir. 1978), cert. denied, 441 U.S. 913, 99 S.Ct. 2014, 60 L.Ed.2d 386 (1979).

Blancha, 972 F.2d at 516. The EEOC argues that the district

court properly excluded evidence of the loans under Rule 403

because evidence of Nelson's questionable conduct would be highly

likely to distract the jury from focusing on the claim of sexual

harassment and would cause the factfinder to be inclined to find

a Title VII violation out of a desire to punish the supervisor

for his unethical conduct. Appellee's br. at 16-17.

We conclude, however, that the probative value of this

evidence is not "substantially outweighed by the danger of unfair

prejudice." We already have discussed the relevance of the

evidence to an understanding of why Spain's co-workers continued

to see her privately with Nelson even after she and Nelson knew

of the rumors and to an understanding of why Nelson did not take

steps to stop the rumors. Indeed, Nelson admits that loans were

made on the dates for which Spain has canceled checks, although

he denies that he solicited them and offers an alternative

36 explanation. Appellee's app. at 4-7. Thus, the dispute concerns

not whether they were loans, but rather the motivation for them

and their frequency.

The EEOC contends, in essence, that the evidence would

make the jury more likely to turn a breach of ethics into a

finding of sexual harassment. "Yet, '[v]igorous cross-

examination, presentation of contrary evidence, and careful

instruction on the burden of proof are the traditional and

appropriate means of attacking shaky but admissible evidence."

Petruzzi's IGA Supermarkets, 998 F.2d at 1241 (quoting Daubert v.

Merrell Dow Pharmaceuticals, Inc., 113 S.Ct. 2786, 2798 (1993)).

Given our cautious approach to Rule 403 exclusions at the

pretrial stage, see Petruzzi's IGA Supermarkets, 998 F.2d at

1240; In Re Paoli R.R. Yard PCB Litig., 916 F.2d 829, 859-60 (3d

Cir. 1990), cert. denied, 499 U.S. 961, 111 S.Ct. 1584 (1991), we

hold that the district court abused its discretion in excluding

the evidence under Rule 403.

C. Dismissal For Failure to Prosecute

Spain argues that the district court improperly

dismissed the balance of her case for failure to prosecute after

she determined not to go forward with her racial discrimination

and retaliation claims following the dismissal of the sexual

37 discrimination and harassment claims. We hold that the district

court did not abuse its discretion in this order.0

As we have noted already, after the district court

issued its ruling with respect to the sexual discrimination and

harassment claims and excluded the evidence of the loans, Spain

asked the court whether taking a voluntary non-suit on the

remaining claims would eliminate her right to appeal on them. The

court quite clearly explained that this would be the result with

respect to the issues on which the court determined that Spain

could proceed. App. at 45-46. Moreover, the court and Spain

discussed the fact that the evidence with respect to the sexual

discrimination claim had no bearing on the remaining claims of

racial discrimination and retaliation, and Spain agreed that it

did not. Id. at 46-47. When the case resumed after the weekend,

Spain again raised the possibility of not going forward and the

court again warned her of the consequences if she did not. Id.

at 51. As a result, when Spain decided not to proceed, the

district court dismissed the remaining claims for failure to

prosecute. Id. at 52.

Spain argues that "because of the court's clear error

in denying the evidence as to the sexual harassment, justice

requires reinstatement of the entire Complaint." Appellant's br.

at 25. She contends that her remaining claims of failure to

promote based on race and retaliation are connected closely to

0 We review a dismissal of an action for failure to prosecute under an abuse of discretion standard. Dunbar v. Triangle Lumber and Supply Co., 816 F.2d 126, 128 (3d Cir. 1987).

38 the evidence she was not permitted to introduce. Id. Yet as the

EEOC points out, and as we have reviewed above, Spain agreed

before the district court that the evidence concerning the loans

and the failure to correct the rumors was irrelevant to whether

she was not promoted on account of her race or whether there was

retaliation against her for filing the previous or present

complaint. App. at 46-47.

While Spain now takes a position contrary to that which

she took before the district court, she provides no detailed

argument for why the excluded evidence relates to the racial

discrimination and retaliation claims. Rather, Spain simply

states that proof of her other claims depends upon the jury

having knowledge of all of the events. Appellant's br. at 25.

However, the excluded evidence regarding the loans would not tend

to prove the remaining claims. Furthermore, even if the EEOC had

intended to introduce Spain's poor relationship with her

colleagues allegedly resulting from the loans and rumors as part

of its defense to her claims, the EEOC correctly notes that such

alleged sex-based evidence would be irrelevant to her racial

discrimination and retaliation claims. In any event, even if the

excluded evidence was important to the racial discrimination and

retaliation claims, Spain was obliged to proceed with the trial

notwithstanding the exclusion of the evidence. A party

disappointed with a court's ruling may not refuse to proceed and

then expect to obtain relief on appeal from an order of dismissal

or default. See Marshall v. Sielaff, 492 F.2d 917 (3d Cir. 1974).

39 We recognize that dismissal is a harsh remedy to which

a court should resort only in extreme cases, as "the policy of

the law is to favor the hearing of a litigant's claim on the

merits." Id. at 918 (citation omitted). Nevertheless the

courts may dismiss cases with prejudice for want of prosecution

under Fed. R. Civ. P. 41(b) or under their inherent power so that

they can "manage their own affairs so as to achieve the orderly

and expeditious disposition of cases." Id. (quoting Link v.

Wabash R.R. Co., 370 U.S. 626, 630-31, 82 S.Ct. 1386, 1389

(1962)); see also Eash v. Riggins Trucking Inc., 757 F.2d 557,

561, 564 (3d Cir. 1985) (in banc). Ordinarily, when a court is

determining sua sponte or upon motion of a defendant whether to

dismiss because of a plaintiff's failure to prosecute, and the

plaintiff is opposing the motion, the court must consider several

factors in reaching its decision: (1) the extent of the party's

personal responsibility; (2) the prejudice to the opponent; (3)

any history of dilatoriness; (4) whether the conduct of the party

or the attorney was willful or in bad faith; (5) whether

effective alternative sanctions are available; and (6) the

meritoriousness of the claim or the defense. See Poulis v. State Farm Fire and Casualty Co., 747 F.2d 863, 868 (3d Cir. 1984).

However, in contrast to situations in which a court

must balance factors because the plaintiff does not desire to

abandon her case but has encountered problems in going forward,

Spain willfully refused to prosecute her remaining claims after

receiving an adverse ruling by the district court on the sexual

discrimination and harassment claims. In these circumstances, we

40 cannot fault the district court for dismissing the suit. See

Zagano v. Fordham Univ., 900 F.2d 12, 14 (2d Cir. 1990). Indeed,

it is difficult to conceive of what other course the court could

have followed. Continuing the matter would not have helped

Spain, as she was not confronted with a situation in which she

faced an obstacle to prosecution of her case that could have been

overcome at a later date. Furthermore, the court's sua sponte

action was appropriate; no motion from the EEOC was required.0

Accordingly, we will affirm the order of the court dismissing

Spain's racial discrimination and retaliation claims.

D. The Jury Costs

Finally, Spain appeals from the district court's

assessment of jury costs of $375 against her following the

court's dismissal of her case. We apply an abuse of discretion

standard of review to a court's imposition of sanctions under its

0 Link, 370 U.S. at 630-31; 82 S.Ct. at 1388-89. Spain's reliance on Coursen v. A.H. Robbins Co., 764 F.2d 1329 (9th Cir.), as amended, 773 F.2d 1049 (9th Cir. 1985), is misplaced. In Coursen, which involved a claim of injury from a birth control device, the district court denied the plaintiffs' motion to preclude the defendant from introducing evidence regarding their sexual history. 764 F.2d at 1341. Plaintiffs' actions were dismissed with prejudice when they then refused to proceed to trial. Id. at 1342. The Court of Appeals for the Ninth Circuit vacated the dismissal and remanded the case to the district court "with instructions that plaintiffs be directed to proceed to trial or have their cases dismissed." Id. at 1343. Coursen is quite unlike the present case, however, in that the court of appeals remanded the case to the district court to give the plaintiffs the option to continue with the litigation due to the confusion surrounding the entry of the dismissal order and the resulting availability of appellate review. Here, there is no doubt that Spain had a complete understanding of the implications of deciding not to proceed prior to making that decision.

41 inherent power. Chambers v. Nasco, Inc., 501 U.S. 32, __, 111

S.Ct. 2123, 2138 (1991) (citing Link, 370 U.S. at 633, 82 S.Ct.

at 1390).

While federal courts possess the inherent power to

punish conduct which abuses the judicial process, they must

exercise the power "with restraint and discretion." Chambers,

501 U.S. at , 111 S.Ct. at 2132 (citing Roadway Express, Inc.

v. Piper, 447 U.S. 752, 764, 100 S.Ct. 2455, 2463 (1980)). "A

primary aspect of that discretion is the ability to fashion an

appropriate sanction" for abusive conduct. Chambers, 501 U.S. at

, 111 S.Ct. at 2132-33. Because we believe that there are no

grounds for finding that Spain abused the judicial process with

respect to when she notified the court she would not proceed with

the trial, we hold that the district court abused its discretion

in assessing the jury costs against her.

As we describe above, the district court precluded

Spain from proceeding with her sexual discrimination and

harassment and discrimination claims and issued its evidentiary

exclusion decision on Thursday, July 15, 1993, the day that the

jury was picked. The testimonial portion of the trial was to

begin on Monday, July 19, 1993. However, on that morning, Spain

informed the court she would not proceed with her remaining

claims. The district court then dismissed her case with

prejudice and assessed the jury costs against her.

Perhaps Spain could have reached her decision not to

prosecute her remaining claims and informed the court of her

decision on the day that the court issued its first rulings and

42 the jury was picked, or even on the next day, Friday, July 16,

1993. Yet, even though the trial was set to begin only the

following Monday, and the court was aware that Spain was

contemplating abandoning her remaining claims, it set no time

limit for her decision. See Boettcher v. Hartford Ins. Group,

927 F.2d 23 (1st Cir. 1991) (assessment of jury costs by district

court reversed when case settled on day of trial). Thus, we

find no basis in the record to support a conclusion that Spain

and her attorney acted in bad faith or otherwise abused the

judicial process in taking the weekend before reaching a final

decision not to proceed.0 Moreover, as the district court

imposed the sanction without affording Spain prior notice and an

opportunity to be heard, its action raises due process concerns.

See Eash, 757 F.2d at 570-71. While we could, of course, cure

the due process problem by remanding the matter for

reconsideration of the imposition of the sanction, we think that

in view of the modest $375 assessment, it would be prudent to

consider the matter on the record as it exists. Overall, we are

convinced that the district court abused its discretion in

assessing the costs of the jury against Spain.

III.

CONCLUSION

0 There is no support in the record to conclude that Spain reached her decision before the weekend or even before Monday. In fact, Spain's attorney told the court that he and Spain spent the weekend talking about what to do.

43 Based on the aforesaid analysis, we will reverse the

orders of the district court entering summary judgment against

Spain on the portions of count I of her complaint alleging the

sexual discrimination and harassment claims, excluding the

evidence she offered to prove those claims, and assessing the

costs of the jury against her. We will affirm the court's

dismissal of the remainder of Spain's case for failure to

prosecute. We will remand the case to the district court for

further proceedings on the reinstated claims. The parties will

bear their own costs on this appeal.