JONES v. FLAGSHIP TRAVEL CLUB, (D.N.J. 1999)

OPINION

SIMANDLE, District Judge:

Plaintiff Pamalia Jones sues defendants Flagship Travel Club and Flagship Resort Development Corporation alleging racial discrimination in violation of the Fourteenth Amendment to the United States Constitution, Title II of the Civil Rights Act of 1964, the Fair Housing Act("FHA"), 42 U.S.C. § 3601, et seq., and the New Jersey Law Against Discrimination ("NJLAD"), N.J.S.A. 10:5-1, et seq. Now before the Court is defendants' motion to dismiss and/or for summary judgment. Because the parties have attached extra-pleading materials to their briefs, the Court will treat the motion as one for summary judgment. Plaintiff's Fourteenth Amendment claim will be dismissed against both defendants because the Equal Protection Clause prohibits only discriminatory action by the state, and neither defendant is a state actor. See Moose Lodge No. 107 v. Irvis, 407 U.S. 163, 171 (1972) (citing Shelley v. Kraemer, 334 U.S. 1, 13 (1948)). Additionally, for the reasons stated below, summary judgment will be granted for defendant Flagship Travel Club and denied for defendant Flagship Resort Development Corporation.

I. BACKGROUND

Plaintiff Pamalia Jones is an African-American woman who, on March 1, 1998, was a Division Manager at ATT earning approximately $120,000 a year. (Jones Aff. ¶ 2.) On March 1, 1998, plaintiff accompanied her friend Joyce Martin, a white female with whom plaintiff worked, to the Flagship Resort in Atlantic City, New Jersey, to attend a presentation designed to encourage the attendees to purchase a timeshare unit. (Id. at ¶ 3.) Ms. Martin was plaintiff's subordinate at ATT. (Pl.'s Answer to Interrog. ¶ 19.) Prior to arriving in Atlantic City, the telemarketing firm that scheduled the two friends' visit told Ms. Martin that plaintiff and Martin should not let the sales team know that they were together. (Martin Aff. ¶ 3.) Plaintiff started the sales process a few minutes ahead of Ms. Martin but with a different sales person. (Jones Aff. at ¶ 5.) The two women took a tour of the Flagship facility at the same time with separate sales persons, and, in fact, they were in the same model one-bedroom unit at the same time. (Id. at ¶ 6; Martin Aff. ¶ 5.)

Plaintiff's sales person, Barbara West (Defs.' Br. Ex. B-1), a white female, told her that the unit's price was $14,500. (Jones Aff. ¶ 7.) Plaintiff was very interested in purchasing the unit and inquired about price flexibility, but she was told that all units sold for the same price. (Id. at ¶ 9.) At the plaintiff's insistence, the sales representative called her supervisor, another white female, who confirmed that there was absolutely no negotiation. (Id. at ¶¶ 10-11.) Neither the sales representative nor the manager spoke to plaintiff about different sized units or different set prices based upon the amenities, season, or privileges available. (Id. at ¶ 12.)

Subsequently, plaintiff was sent to see a Flagship Travel Club representative, a white male. (Id. at ¶ 14.) When the representative commented that plaintiff did not buy a timeshare unit, she told him that the unit was too expensive and that the time share representative would not negotiate with her. (Id. at ¶ 15.) The representative told plaintiff that if she purchased a vacation plan, whereby she would receive discounts on room rates at the Flagship facility (Defs.' Br. Ex. A), he could guarantee a price on an efficiency unit (studio). (Jones Aff. ¶ 16.) At that point, plaintiff asked why the time share representatives had not mentioned the availability of the efficiency unit (as opposed to the one bedroom unit) when she was trying to negotiate a different price. (Id. at ¶ 17.) The travel club representative stated that sometimes the timeshare sales representatives do not know about the efficiency units. (Id. at ¶ 18.)

Plaintiff subsequently purchased a vacation plan from the sales representative because she wanted to take advantage of the weekend stays at the Flagship Resort in Atlantic City (id. at ¶ 19) and because she wanted to lock in the price on an efficiency unit. (Pl.'s Answer to Interrog. ¶ 7.) According to plaintiff's interrogatories, that quoted price was $11,500, but the sales receipt indicates that the locked-in rate would be $8,500.00. (Compare id. with Defs.' Br. Ex. F.) She paid $995.00 for that membership, and, by doing so, she guaranteed that she could purchase an efficiency unit at the Resort for $8,500.00 at any point in that year. (Defs.' Br. Ex. F.) The travel club sales representative also gave plaintiff several coupons and said that since he was unable to get her room for the previous night complementary, he would give her an additional coupon which contained a different signature than the other coupons. (Jones Aff. ¶ 20.)

Plaintiff's companion, Ms. Martin, had also originally been told that the model one-bedroom unit which both plaintiff and Ms. Martin had been shown cost $14,500.00. (Martin Aff. ¶ 6.) After she began to ask questions regarding the price of the unit, however, she was given a new price of $9,800.00 for the same unit. (Id. at ¶ 7.) Ms. Martin informed plaintiff of this as they were traveling home (Jones Aff. ¶ 21), and this made plaintiff feel dirty and disrespected. (Pl.'s Answer to Interrog. ¶ 1.) Plaintiff says this worsened when she received a call at home from a sales manager from Flagship, who informed plaintiff that the Travel Club Sales Representative was not authorized to give her the extra coupons and could be fired for doing so. (Jones Aff. ¶¶ 22, 23.) At that point, plaintiff decided that she did not want to do business with Flagship, and she did not purchase the studio/efficiency apartment. (Id. at ¶ 24.)

On April 7, 1998, plaintiff filed suit in this Court alleging that Flagship Travel Club's conduct violated the Fourteenth Amendment to the U.S. Constitution, Title II of the Civil Rights Act of 1964, the FHA, 42 U.S.C. § 3601, et seq., and the NJLAD, N.J.S.A. 10:5-1, et seq. She later amended the complaint to include Flagship Resort Development Corporation as a co-defendant. According to the Amended Complaint, "[p]laintiff was unable to purchase a time share as a result of the unlawful practices complained of herein" (Compl. ¶ 6), and "[d]efendants' agents, servants and supervisory employees while carrying out their duties wilfully and intentionally discriminated against plaintiff by giving her an inflated sales price and refusing to negotiate with her because of her race." (Id. at ¶ 9.)

The Court agrees with defendants that plaintiff's evidence does not show that she was in fact unable to purchase a time share, for the defendants did guarantee her a price of $8,500.00 on an efficiency unit. However, taken in a light most favorable to the plaintiff, plaintiff's Complaint and evidence can be read as stating that plaintiff was unable to purchase the unit that she wanted because she was quoted prices beyond her reach, and that defendants wrongly refused to negotiate with her to a lower price on the unit which she wanted due to her race and contrary to their policy and practice of permitting negotiation of a lower price. The Court construes the Complaint in this manner.

Following discovery, on April 15, 1999, defendants brought this motion to dismiss and/or for summary judgment, which, as stated before, this Court treats as a motion for summary judgment and thus considers the evidence in the record. In support of this motion for summary judgment, defendants did not attach depositions or other evidence from the sales representative or supervisor who plaintiff says refused to negotiate or the travel sales representative who sold plaintiff the travel club membership. Indeed, for various reasons discussed by the parties in their briefs, none of these persons was ever deposed.

In her opposition brief, plaintiff begins her preliminary statement by noting that "plaintiff has been frustrated in her efforts to obtain discovery in this matter by defendants' refusal to cooperate in discovery. Said refusal is in clear violation of Rule 37 of the Federal Rules of Civil Procedure." (Pl.'s Br. at 1.) However, plaintiff did not file a motion based on discovery violations, and any such motion would be brought before Magistrate Judge Joel A. Rosen, who has coordinated discovery in this matter. This Opinion will not address any alleged violations.

Instead, defendants base their argument for summary judgment on other forms of evidence. For example, defendants attach as a pricing guide which indicates that there are four different prices for each of the various types of units within the resort, and that price varies depending on the size of the unit (basic studio, deluxe studio, one bedroom, two bedroom with 1 ½ bath, and two bedroom with two bathrooms) and the flexibility of the plan which the individual purchaser chooses. (Defs.' Br. Ex. D.) Defendants also attached portions of the deposition testimony of several of their employees. As explained by Taylor Limauro, who was the sales manager at the time in question (but who denies having any recollection of the individual incident in question (Limauro Dep. at 40:6-41:25)), while there are different prices within the framework of the different models, "the prices are not set by the salesperson or manager and . . . you cannot go below a certain price without the sales director." (Id. at 9:20-10:4.) Ms. Limauro further testified that negotiations are involved, but that the price can only be changed in certain circumstances, either by lowering the interest rate or by changing the options on the unit. (Id. at 28:16-18; 29:7-12; 30:16-20.) She emphasized that a salesperson cannot arbitrarily change the price for the same exact inventory (same unit with same options). (Id.) Other than explaining the structure of pricing within the Flagship Resort, defendants presented no direct evidence or testimony that the Resort managers and sales representatives who worked with plaintiff on March 1, 1998 did negotiate with her or discuss price flexibility in any way, other than that the Travel Club sales representative eventually offered her a studio instead of a one bedroom apartment facing the ocean.

II. DISCUSSION

A. Summary Judgment Standard

Summary judgment is appropriate when the materials of record "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);see Hersh v. Allen Prods. Co., 789 F.2d 230, 232 (3d Cir. 1986). A dispute is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the non-moving party." See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A fact is "material" only if it might affect the outcome of the suit under the applicable rule of law.Id. Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment. Id. In deciding whether there is a disputed issue of material fact the court must view the evidence in favor of the non-moving party by extending any reasonable favorable inference to that party. See Aman v. Cort Furniture Rental Corp., 85 F.3d 1074, 1080-81 (3d Cir. 1996); Kowalski v. L F Products, 82 F.3d 1283, 1288 (3d Cir. 1996). The threshold inquiry is whether there are "any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party." Liberty Lobby, 477 U.S. at 250.

B. Analysis

Plaintiff brings her claim pursuant to the Fourteenth Amendment, Title II of the Civil Rights Act, the FHA, and NJLAD. Each of these provisions prohibits racial discrimination. The Fourteenth Amendment, of course, prohibits disparate treatment by the government, i.e., purposely treating a person differently because of his or her race, and, as noted earlier, this claim will be dismissed because neither defendant is a state actor. Title II guarantees equal access to the enjoyment of places of public accommodation. 42 U.S.C. § 2000a(a). The FHA prohibits discrimination "against any person in the terms, conditions or privileges of sale or rental of a dwelling, or in the provision of services or facilities in connection therewith, because of race . . .," 42 U.S.C. § 3604(b), whether it is by the refusal "to sell or rent after the making of a bona fide offer, or [the refusal] to negotiate for the sale or rental" of a unit. Id. at § 3604(a). NJLAD states that "[a]ll persons shall have the opportunity to obtain . . . all the accommodations, advantages, facilities, and privileges of any place of public accommodation, and other real property without discrimination because of race . . . ." N.J.S.A. 10:5-4.

Plaintiff's case here is based on charges of disparate treatment in the negotiation of the sale of a timeshare property. Plaintiff does not have direct evidence of any discrimination. For example, through discovery she has found no witnesses or evidence which state that the defendants had a discriminatory policy or that comments were made about her race. However, it is rare that such outward signs of discrimination exists, and it is for that reason, "because of the evidentiary difficulties involved in proving discriminatory intent," Chauhan v. M. Alfieri Co., Inc., 897 F.2d 123, 126 (3d Cir. 1990), that summary judgment motions in these cases are governed by the burden shifting provisions laid down in McDonnell Douglas Corp. v. Green, 411 U.S. 792, 802 (1973), as refined in Texas Department of Community Affairs v. Burdine, 450 U.S. 248, 252-253 (1981). See Keller v. Orix Credit Alliance, Inc., 130 F.3d 1101, 1114 n. 5 (3d Cir. 1997) (citingGrigoletti v. Ortho Pharmaceutical Corp., 570 A.2d 903 (N.J. 1990) (McDonnell Douglas scheme applies under LAD)); Chauhan, 897 F.2d at 126 (applying McDonnell Douglas to the leasing context and noting that the 6th and 9th Circuits have applied it to the FHA); United States v. Landsdowne Swim Club, 894 F.2d 83, 88 (3d Cir. 1990) (applying McDonnell Douglas test in a Title II case); Watson v. City of Salem, 934 F. Supp. 634, 653 (D.N.J. 1995) (McDonnell Douglas applies in Fourteenth Amendment case).

Because plaintiff's case is based on disparate treatment, rather than disparate impact, defendants' discussion of the lack of discriminatory effect in their moving brief is irrelevant.

"The McDonnell Douglas formula is grounded in the presumption that if a rational reason for disparate treatment is not forthcoming, it is more likely than not that illegal discrimination played a role in the decision." Chauhan, 897 F.2d at 127 (citing Furnco Construction Corp. v. Waters, 438 U.S. 567, 577 (1978)). Under the McDonnell Douglas — Burdine burden shifting test, plaintiff first has the burden of establishing a prima facie case. Once that is established, the burden shifts to the defendants to offer a legitimate, non-discriminatory reason for their actions. If the defendant can proffer such a reason, the burden shifts back to the plaintiff to show that the proffered reason is pretextual. Chauhan, 897 F.2d at 127. To show pretext, the plaintiff does not need direct evidence of discrimination, but the plaintiff must present direct or circumstantial evidence beyond the basic facts necessary to establish the prima facie case "establishing a reasonable inference that the . . . proffered explanation is unworthy of credence." Id. at 127-128.

Applying the prima facie case in this context, it is clear that if plaintiff's claim was that defendants refused to sell to her, then summary judgment would be appropriate. In order to prove her prima facie case for such a claim, plaintiff would have to show that

(i) she belongs to a protected category,

(ii) she attempted to buy a timeshare property and was qualified for it,

(iii) despite her interest and qualifications, she was rejected, and

(iv) after the rejection, the timeshare property remained open and the defendants continued to try to sell it.

While plaintiff has clearly presented evidence that she is in a protected category (African-American), that she attempted to buy a timeshare property and had sufficient resources to qualify to buy it, and that the timeshare property remained open after she did not buy a timeshare, she has not presented evidence that either defendant refused to sell to her. To the contrary, Flagship Resort Development Corporation was apparently willing to sell her the one-bedroom unit for $14,500.00, and Flagship Travel Club did sell her a membership and hold open an efficiency apartment at $8,500.00. To the extent that the Complaint might allege that the defendants refused to sell, summary judgment would be appropriate.

However, that is not plaintiff's claim. Instead, plaintiff argues that the defendants discriminated against her by failing to negotiate with her for a different price on the unit of the type that she desired. Given that Title II and NJLAD prohibit discrimination at all in this context, and that the FHA prohibits not only refusal to sell but also refusal to negotiate or changing of terms or conditions of sale because of race, a defendant's discriminatory refusal to negotiate the terms of a sale can itself violate the law.

For a discriminatory refusal to negotiate claim, plaintiff's prima facie case of liability would be very similar as for refusal to sell. Plaintiff would have to put forth evidence that

(i) she belongs to a protected category,

(ii) she attempted to negotiate for the sale of a timeshare and was qualified for it,

(iii) despite her interest and qualifications, defendant refused to negotiate while negotiating with others who were not members of the protected class, and

(iv) after the rejection, the timeshare property remained open and the defendant continued to try to sell it.

Again, plaintiff has put forward evidence that she belongs to a protected category and that the timeshare property remained open for sale after she did not buy it. Moreover, she has presented her own sworn testimony that she did attempt to negotiate for a lower price on the one-bedroom unit, that she was prepared to purchase it at the right price, and that price flexibility was offered to a white person while it was refused to her.

Defendants contend, however, that summary judgment in their favor is nonetheless appropriate because plaintiff cannot show that defendants refused to negotiate with her. After all, defendants argue, plaintiff must have been able to negotiate because she was able to get a price of $8,500 — and her friend, Ms. Martin, could only get a price of $9,800. Defendants are correct that plaintiff apparently did negotiate with defendant Flagship Travel Club in getting a guaranteed price of $8,500 for an efficiency apartment, and thus plaintiff cannot meet her prima facie case as to Flagship Travel Club; all claims against Flagship Travel Club will be dismissed. That plaintiff decided to abandon her deal with Flagship Travel Club was due to nothing that the Club had done or failed to do.

The argument of the remaining defendant, Flagship Resort Development Corporation, however, ignores the fact that, according to plaintiff's (uncontroverted) sworn statements and testimony, defendant Flagship Resort Development Corporation refused to negotiate with her on the price of the one-bedroom unit, which is the unit that she wanted. Plaintiff has presented evidence that she inquired about price flexibility on the one-bedroom unit and that she was told that there was no negotiation. Her friend, Ms. Martin, who is white, was able to negotiate with defendant Flagship Resort Development Corporation for a price of $9,800. Given that plaintiff's qualifications were apparently equal to that of Ms. Martin, if not more so because plaintiff was Ms. Martin's superior at ATT and was earning more money, there would appear to be no explanation for this discrepancy other than race. Plaintiff has met her prima facie case as to Flagship Resort Development Corporation.

It is thus Flagship Resort Development Corporation's burden to come forward with a legitimate, non-discriminatory reason for refusing to negotiate with plaintiff. Defendant explains in its brief and attached exhibits that sales representatives do not have the authority to offer different prices for the exact same unit with exact same options. That same evidence, however, shows that defendant's sales representatives can negotiate with potential buyers by offering different options to them. For example, a buyer might purchase a plan which denies them the ability to take their week in the unit in the summer, or a plan which only allows the purchaser to schedule their week in the unit within 60 days of the anticipated vacation. (See Limauro Dep. at 10:5-13:25, 31:4-32:25.) Given that plaintiff's claim is that defendant discriminated against her by not discussing these money-saving options with her, Flagship Resort Development Corporation's proffered explanation is not conclusive, and a dispute remains whether defendant had a legitimate, non-discriminatory reason for the refusal to negotiate. For that reason, summary judgment for defendant Flagship Resort Development Corporation will be denied.

Therefore, plaintiff need not come forward with evidence of pretext. Even if the defendant's statement about the sales representatives' inability to change prices without changing options somehow did constitute a "proffered, legitimate reason," plaintiff would have satisfied her burden of providing evidence of pretext through her testimony that defendant did not discuss these options with her while discussing them with other (white) buyers. If, at trial, defendant states a legitimate, non- discriminatory reason, defendant would, of course, be free to argue that plaintiff cannot prove either pretext or damages because Flagship Resort Development Corporation's related company, Flagship Travel Club, did hold open an efficiency apartment for plaintiff, and thus that defendant did not try to exclude plaintiff on the basis of her race. If the jury does not believe that the proffered reason is a pretext for discrimination, or if the jury believes that plaintiff has not been damaged by defendant's action, then plaintiff will lose her case. After all, there is no cause of action if there is no damage, no matter how discriminatory the defendant's actions.

III. CONCLUSION

For the foregoing reasons, this Court grants summary judgment to defendant Flagship Travel Club on all claims against it. Moreover, this Court grants summary judgment to both defendants on plaintiff's Fourteenth Amendment claim. However, the Court denies summary judgment to defendant Flagship Resort Development Corporation in all other respects because plaintiff has met her burden of establishing a prima facie case that defendant discriminated against her by refusing to negotiate as to the price or options of timeshare property, thus violating Title II of the Civil Rights Act, the Fair Housing Act, and NJLAD, and defendant Flagship Resort Development Corporation failed to meet its burden of proffering a legitimate, non- discriminatory reason for refusing to negotiate. The accompanying Order is entered.

ORDER

This matter having come before the Court upon defendants' motion to dismiss and/or for summary judgment; and the Court having considered the parties' submissions; and for the reasons stated in the Opinion of today's date;

IT IS this day of May 1999 hereby

ORDERED that defendants' motion for motion to dismiss and/or for summary judgment is treated as a motion for summary judgment, and that defendants' motion is GRANTED IN PART AND DENIED IN PART, as follows:

Summary judgment is GRANTED to both defendants on plaintiff's claim pursuant to the Fourteenth Amendment of the United States Constitution; and

Summary judgment for defendant Flagship Travel Club is GRANTED; and

Summary judgment for defendant Flagship Resort Development Corporation is DENIED in all other respects.

_________________________ Date

_____________________ JEROME B. SIMANDLE U.S. District Judge