Judge lets sexual harassment claim against Rutherford move forward; dismisses others

Former Illinois Treasurer Dan Rutherford will have to defend himself against allegations he sexually harassed an employee, a federal judge ruled last week.

In a 29-page opinion, U.S. District Judge Joan Humphrey Lefkow refused to throw out Edmund Michalowski's sexual harassment claim against Rutherford, but granted the defendants' requests to dismiss a separate sexual harassment count against the state and treasurer's office, as well as First Amendment violation and racketeering claims.

The judge also rejected the defendants' motion for sanctions against Michaelowski's attorney over the racketeering claims she brought for her client and set a hearing for Tuesday, when the plaintiff was slated to indicate whether he plans to file amended claims under the Racketeer Influenced and Corrupt Organizations (RICO) Act.

Lefkow's March 6 ruling stems from four separate motions to dismiss the lawsuit Michalowski filed last February against Rutherford, then-then treasurer who lost his bid for governor in Republican primary a month later, and his chief of staff, Kyle Ham.

Michalowski-- a licensed attorney who served as director of community affairs and marketing for the treasurer’s office from 2011 until February and now works at the Cook County Recorder of Deeds-- claims he resigned as a result of the defendants’ conduct, which the suit describes as forced outside political work and sexual harassment from the treasurer, as well as retaliation after complaining about it to Ham.

After that complaint was dismissed, Michalowski filed an amended one, in which he added more defendants: the state, its treasurer's office, Rutherford's then-deputy chief of staff Curt Conrad, Rutherford's gubernatorial campaign committee and Mitt Romney's 2012 presidential campaign committee (Rutherford was appointed chair of the Illinois campaign in 2011).

He also added the RICO claims, which accused the defendants of engaging in a pattern of racketeering activity by forcing Michalowski to work for the campaigns, and a separate sexual harassment count against the state and treasurer's office that alleged a hostile working environment under Title VII of the Civil Rights Act of 1964.

In her recent ruling, Lefkow agreed with the defendants and dismissed those claims.

The judge said the racketeering claim needed to be thrown out because Michalowski failed to prove the "continuity" factor under the RICO Act as the campaigns ended and he only claimed the alleged scheme occurred during his employment.

She also dismissed his First Amendment claim, saying "the nature of Michalowski’s position made political affiliation—of which support for particular campaigns is a part—a valid qualification. Thus, the requirement that Michalowski exhibit support for the campaigns is not a First Amendment violation, even if it may be a violation of Illinois law."

But, Lefkow refused to dismiss the sexual harassment claim against Rutherford, saying that Michalowski has provided sufficient allegations at this stage in the litigation to move forward.

While Rutherford was correct in saying "'simple teasing,’ . . . offhand comments, and isolated incidents (unless extremely serious) will not amount to discriminatory changes in the ‘terms and conditions of employment,”’ the judge said Michalowski claims "that Rutherford grabbed at his genitals in the guest bedroom of the Rutherford residence, and on two occasions grabbed his arm before making sexual comments."

"These allegations go 'beyond offhand comments and into physical assault' and 'raise [] the possibility of severe or pervasive sexual harassment from a speculative to a plausible level,' which is all that is required at this stage," Lefkow explained.

She went on to reject the former-treasurer's contention that even if Michalowski's hostile work environment claim could proceed, he is entitled to qualified immunity.

Because Michalowski "alleged facts sufficient to state a hostile work environment claim," the judge said, in looking at the case in a light most favorable to the plaintiff, Michalowski showed Rutherford violated his constitutional right, which defeats the qualified immunity argument.

In her ruling, Lefkow also granted Michalowski's motion to strike certain exhibits attached to the motions to dismiss and denied a request Rutherford, Ham and Conrad filed for sanctions against Michalowski's lawyer, Alice Christine Svenson.

They argued that Svenson, of Chicago, had  raised "patently baseless" RICO claims because they were based on alleged violations of state law, specifically intimidation and official misconduct, and therefore, can't be considered predicate acts for the federal RICO Act.

"Although the court agrees with the individual defendants that Michalowski’s counsel failed to allege RICO claims adequately, counsel’s legal arguments are not without some support in this circuit," Lefkow said.

Rutherford publicly denied the allegations Michalowski made in his initial lawsuit during a press conference held on the same day the suit was filed in February 2014. The former treasurer also pointed to the “suspect timing of this lawsuit and the motive behind it" in one of his motions.

Rutherford is represented by Daniel T. Fahner, Robert L. Shuftan and Bilal Zaheer of Edwards Wildman Palmer LLP in Chicago and R. Douglas Rees and Rachel Laird Tidwell-Neal of the Illinois Attorney General’s office represent Ham, Conrad, the state and the treasurer's office.