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If an employee sues his employer for discrimination, and is subsequently terminated, he can tack on an unlawful retaliation claim. He may not win, but he’ll probably get a chance to make his case.
Let’s tweak that scenario. If an employee sues his employer for discrimination, leaves the company to start his own business, and later doesn’t get a chance to pitch a software idea to the former employer, he doesn’t then get to sue for retaliation.
That seems pretty obvious, right? At least the Seventh Circuit Court of Appeals thinks it is.
In 2005, Syed Alam filed an employment discrimination lawsuit against Miller Brewing, his former employer. Alam and Miller Brewing settled the case in 2006. At some point thereafter, Alam, whose company Alam & Company provides software and consulting services to the brewing industry, approached MillerCoors, the joint venture between Miller Brewing and Coors Brewing Company, about developing a software prototype for MillerCoors and its distributors.
MillerCoors told Alam that if he developed the software prototype, it would give him an opportunity to make a sales presentation.
After Alam spent over two months working to develop the prototype and collaborating with MillerCoors employees, the company indicated that it would no longer consider working with Alam because of his prior lawsuit.
Alam sued Miller Brewing and MillerCoors, alleging unlawful retaliation under Title VII and a state law claim for promissory estoppel. The district court granted the defendants' motion to dismiss for failure to state a claim, and Alam appealed.
To avoid dismissal, Alam's complaint must contain allegations that "state a claim to relief that is plausible on its face." The complaint must contain "allegations plausibly suggesting (not merely consistent with)" an entitlement to relief.
Here, the Seventh Circuit Court noted that Title VII's anti-retaliation provision makes it "an unlawful employment practice for an employer to discriminate against any of his employees or applicants for employment ... because he has opposed ... an unlawful employment practice."
While individuals are protected from retaliation by their former employers, and as applicants for employment, Alam didn't allege that he applied for employment with MillerCoors or that he was ever employed by MillerCoors. Instead -- as the district court concluded -- his prospective status in relation to MillerCoors was that of an independent contractor, which does not fall within the protections of Title VII.
If Alam had applied for employment, the "we-won't-hire-you-because-you-sued-us" excuse might have been actionable. As a prospective independent contractor, Alam was out of luck.