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Complaint Alleging CRS Discriminated Against Employee Based on Sexual Orientation Partially Survives Dismissal

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On Friday, Judge Catherine C. Blake of the District of Maryland partially dismissed an unnamed plaintiff’s complaint alleging that his employer, Catholic Relief Services (CRS), discriminated against him based on sexual orientation through denying coverage to his husband as a dependent under an employer-sponsored health plan.

The plaintiff, a gay, cisgender man legally married to a man, originally alleged that after being hired by CRS in mid-2016 and receiving health care coverage for both the plaintiff and his husband through an Aetna-administered plan, CRS told the plaintiff in November 2016 that providing the coverage to the plaintiff’s husband was a mistake “because CRS does not cover same-sex spouses under the Plan.”

This purportedly was contrary to what a recruiter told the plaintiff before accepting the employment offer: “All dependents are covered,” with “dependent” defined as “wife or husband,” the court explained. The plaintiff claimed that the same sentiment was repeated to him during onboarding and that no one told the plaintiff that a same-sex spouse would not be covered as a dependent spouse under the plan prior to CRS telling him that his husband “mistakenly” was provided coverage.

The plaintiff’s spousal benefits eventually were terminated on Oct. 1, 2017, and after receiving a right to sue letter from the Equal Employment Opportunity Commission on June 1, 2020, the plaintiff filed suit just under two weeks later, alleging 10 counts against CRS. The causes of action included sexual orientation discrimination, denial of wages, breach of contract, and negligent misrepresentation, among others. CRS moved to dismiss completely the first nine counts and one claim of the tenth count, arguing in part that it is exempt from sexual orientation discrimination claims under the Maryland Fair Employment Practices Act (MFEPA) because it is a religious organization.

The court denied the defendant’s motion as to Counts I-III — the plaintiff’s discrimination claims under MFEPA and Maryland Equal Pay for Equal Work Act (MEPWA) — not on the merits of the allegations, but because “the court finds it is best to consider whether the plaintiff’s state law sex discrimination claims (Counts II and III) are co-extensive with the federal discrimination claims at the same time it considers the federal claims,” the court said, addressing the denial as to Count I for a similar reason: “(T)he court prefers to defer ruling on the scope of MFEPA’s religious exemption as it relates to this matter until it can interpret the exemption together with the issue raised regarding the definition of ‘sex discrimination’ under the statute, which … should be cocnsidered alongside the plaintiff’s federal claims.”

Regarding the contract breach allegation, the court sided with the defendant, reasoning that because “the plaintiff is an at-will employee” and “CRS may lawfully change its policy at any time,” the plaintiff initially being told that all dependents were covered by the health plan only to eventually have the coverage revoked did not constitute a contract breach, the court explained. This conclusion bled into the court’s negligent misrepresentation claim analysis, which said the plaintiff “could not have justifiably relied” on the initial statements by his recruiter and during onboarding regarding whether his husband would receive coverage for the entirety of the plaintiff’s employment because those statements were meant to reflect the purported policy at those particular times, and the plaintiff did not show damages that directly came from the initial alleged misstatements.

The court sided with the defendant on the remaining counts, leaving only Counts I-III to survive.
The plaintiff is represented by Gilbert Employment Law P.C. and Brown, Goldstein & Levy LLP. The defendant is represented by Gallagher Evelius & Jones LLP.

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