Brown sued National Penn in the U.S. District Court for the Eastern District of Pennsylvania, alleging gender discrimination and retaliation under both Title VII of the Civil Rights Act of 1964.

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No proof of discrimination

The district court held that Brown failed to state a prima facie claim of discrimination. To demonstrate gender discrimination, Brown needed to show that:

(1) She belonged to a protected class;

(2) She was performing adequately;

(3) She suffered an adverse employment action; and

(4) The action took place under circumstances suggesting discrimination.

Although Brown's termination and perhaps the delay in her performance evaluation and expected raise constituted adverse employment actions, the trial court ruled for the employer because she failed to provide any evidence indicating that National Penn took those actions under circumstances suggesting discrimination.

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Brown's discrimination argument was unpersuasive because the record showed that she was fired for taking advantage of her position by obtaining and using confidential customer information for her own benefit, an action that violated National Penn's code of conduct. Brown offered no examples of male coworkers being treated differently and drew no logical connection between her firing and Broemal's alleged comment about larger clients preferring male agents. Brown pointed to no record evidence indicating that her termination was because of her gender.

The district court also held that Brown failed to provide any evidence of retaliation. To prove her case, Brown was required to show that:

(1) she was engaged in protected activity

(2) she was discharged subsequent to or contemporaneously with such activity

(3) there was a causal link between the protected activity and the discharge.

The district court held that Brown failed to show that she engaged in a protected activity because she complained only of unfairness.

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Distorting the record

Brown appealed and the U.S. Court of Appeals for the Third Circuit reviewed her claims in Brown v. National Penn Ins. Services Group Inc. On appeal, the court said, Brown attempted to distort the record, arguing that within three weeks of Brown's complaint during her conversation with Broemal about unfairness about National Penn's gender-based decision-making, Brown was terminated. But she provided no citation to the record in support of this characterization, and the court's independent review of the record led it to conclude that she did not complain about gender-based decision-making during her meeting with Broemal. Instead, Brown herself stated that she complained only that the reorganization, including her move to a shared office, “was unfair.” Such a generic complaint does not qualify as protected activity, so Brown's case failed.

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Insurance agents and brokers, like Brown, must keep the records and information about the clients sacrosanct. Brown, without authority, did the opposite. By violating the insurer's code of conduct, which instructed employees to avoid conflicts of interest and self-dealing transactions and prohibited the use of confidential information “except for the proper conduct of the business of” National Penn, she was terminated. The court was convinced that she was terminated solely because of her breach of the code of conduct.

Barry Zalma, Esq., CFE, is a California attorney, insurance consultant and expert witness specializing in insurance coverage, claims handling, bad faith and fraud. Contact him at [email protected].