Blockbuster Settles Harassment and Discrimination Suit for $2 Million

Blockbuster, Inc., the global media retailer based in Texas, has agreed to settle a lawsuit with the Equal Employment Opportunity Commission (EEOC) for $2 million. The lawsuit, filed in a federal court in Baltimore, Maryland, accused the company of sexual harassment and retaliation against female temporary employees, as well as racial and national origin discrimination against Hispanic temporary employees. The alleged events occurred at Blockbuster’s Gaithersburg, Maryland distribution center in 2004 and 2005. The EEOC announced on December 14, 2011 that it had entered into a consent judgment with Blockbuster, and that a federal district judge had approved the agreement.

The EEOC’s lawsuit charged that male supervisors both condoned and engaged in harassment against seven female employees. Four of the employees are Hispanic. The harassment reportedly consisted of yelling and insults, racial comments, inappropriate and unconsented bodily contact, inappropriate comments and questions of a sexual nature, and requests or demands for sexual activities. Supervisors also allegedly retaliated against employees who refused sexual overtures. The lawsuit claimed multiple violations of Title VII of the Civil Rights Act of 1964, which prohibits employment discrimination based on sex, race, national origin, and other categories.

All of the employees victimized by supervisors’ harassment worked for a temporary staffing agency employed by Blockbuster. Although, technically, none of the plaintiffs were direct employees of Blockbuster on paper, the law considers them employees for the purpose of enforcing protections against discrimination and harassment. Since they worked in that environment full-time, the harassment and discrimination affected them regardless of the specific employment relationship.

Blockbuster, Inc. is a Dallas, Texas-based retailer of home video and video game rentals. It operates both physical stores, DVD-by-mail, and online content delivery. It filed for bankruptcy in September 2011, while the EEOC’s case was pending, because of declining business and competition from companies like Netflix. Although it began as a Chapter 11 reorganization case, the case almost had to convert to a Chapter 7 liquidation because the company lacked enough assets to cover many of its debts. Dish Network bought the company at auction in April 2011. The EEOC’s lawsuit was filed against the corporation itself and does not affect the assets purchased by Dish Network. Dish Network reorganized Blockbuster as a limited liability company after the auction.

The federal Civil Rights Act of 1964 applies across the country. Even though the case against Blockbuster was filed in Maryland, the same laws protect workers in New York. The federal law prohibits gender-based discrimination, or unreasonable and unequal treatment of employees based solely on gender. This includes sexual harassment and unequal treatment in job duties, hiring, or firing. It also includes creating or tolerating a hostile work environment that affects employees of one gender more than others. New York has similar laws at the state level and, in New York City, the municipal level to protect employees from discrimination based on gender, race, national origin, and more.

The New York sexual harassment lawyers at Phillips & Associates represent victims of workplace sexual harassment and discrimination, fighting to protect their rights. To schedule a free and confidential consultation, contact us today online or at (212) 248-7431.

More Blog Posts:

Sexual Harassment at Office Holiday Parties, New York Employment Attorney Blog, December 20, 2011
Female Dockworkers Experience Discrimination, Harassment on the New Jersey Waterfront, New York Employment Attorney Blog, December 15, 2011
Staten Island Ferry Deckhands Used Security Cameras for a “Peepshow,” New Lawsuit Claims, New York Employment Attorney Blog, December 7, 2011

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