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Law Against Discrimination Prohibits Sexual Advances by Supplier Against Female Business Owner

Posted by Frank Steinberg | Jan 07, 2010 | 0 Comments

JT's Tire Service v. United Rentals is not, strictly, speaking, an employment law case.  But it affords us an interesting look at an unusual issue under New Jersey's Law Against Discrimination, the linchpin of employment discrimination litigation in the great Garden State.  As you will see, this opinion merits the attention of every business in New Jersey.

The facts are simple.  JT's Tire Service is owned by Eileen Tortorello.  JT's sold industrial tires to the United Rental branch in Piscataway starting in 1998.  In 2005 Hinckes, who managed the Piscataway branch, began to pressure Tortorello for a sexual relationship.  She refused and United stopped buying tires from JT's.  Tortorello got United's work back when she agreed to have lunch with Hinckes, but he continued to threaten her with the loss of business.  His advances became physical.  Payments due to JT's from United were delayed, and eventually ceased altogether.

JT's sued under a section of the LAD which makes it unlawful to discriminatorily refuse to do business with another on the basis of sex (among other things).  

The trial court dismissed the complaint on the theory that United's refusal to do business with JT's was not "on the basis of sex."

The Appellate Division reversed and reinstated the complaint.  The court noted that sexual harassment is a form of sex discrimination and rejected the defendant's argument that Tortorello, as the owner of a business separate from United Rentals, did not need protection from sexual harassment.  The court found that quid pro quo sexual harassment violates the LAD even when the victim is not an employee but someone who is doing business with the harasser.

So the next time you get the idea that you can safely make advances to a supplier — and threaten to withhold business if you don't get what you want — think again.  At least in New Jersey, it's against the law.

About the Author

Frank Steinberg

Frank is the founder and principal of Steinberg Law, LLC. A Jersey boy born and bred, he focuses on employment litigation and counseling, business litigation,  and aviation law. Following law school and a clerkship in the federal district court Frank spent his early career with large litigation ...

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