P O BOX 8126, MADISON, WI 53708-8126 (608/266-9850)

DOREEN H BURTON, Complainant




ERD Case No. 9303620
EEOC Case No. 26G932311

An administrative law judge (ALJ) for the Equal Rights Division of the Department of Industry, Labor and Human Relations issued a decision in this matter on February 24, 1995. A timely petition for review was filed with the Equal Rights Division, which then forwarded the file to the commission on November 14, 1995.

The commission has considered the petition and the positions of the parties, and it has reviewed the evidence submitted to the ALJ. Based on its review, the commission agrees with the decision of the ALJ, and it adopts the findings and conclusion in that decision as its own, except that it makes the following modifications:

Paragraph 6 of the ORDER is deleted and the following paragraph is substituted therefor:

"Within 30 days of the expiration of time within which an appeal may be taken herein, Marketing Technologies shall submit a compliance report detailing the specific action taken to comply with the commission's decision. The compliance report shall be directed to the attention of Kendra DePrey, Labor and Industry Review Commission, P.O. Box 8126, Madison, Wisconsin."


The decision of the administrative law judge (copy attached), as modified, is affirmed.

Dated and mailed: May 10, 1996
burtodo.rmd : 125 : 9

Pamela I. Anderson, Chairman

Richard T. Kreul, Commissioner

David B. Falstad, Commissioner


The complainant, a female, alleged that the three named respondents in this case had discriminated against her in violation of the Act by sexually harassing her, and by terminating her employment because of her sex and because she had opposed a discriminatory practice under the Act.

The administrative law judge found that the respondent Marketing Technologies, Inc., (Respondent A) discriminated against the complainant in violation of the Act by terminating her employment because she opposed a discriminatory practice under the Act. Respondent A was ordered to cease and desist from discriminating against the complainant, and to pay her back pay and attorney's fees. However, claims of discrimination against the complainant's supervisor, Joseph Balistreri (Respondent B) and the sole owner of Respondent A, Donald Heilman (Respondent C) were dismissed on the ground that they were not proper respondents.

On appeal, in an attempt to establish a basis for imposing liability upon Balistreri, the complainant apparently argues that Balistreri, having exercised supervisory responsibilities over her, was an agent of Respondent A and therefore could be determined to be an employer over the complainant. This argument fails, however, because section 111.39(4)(c), Stats., expressly provides that "If the examiner awards any payment to an employe because of a violation of s.111.321 by an individual (i.e., agent) employed by the employer, under s.111.32(6), the employer of that individual is liable for the payment."

The complainant also argues that this would be an appropriate case in which to "pierce the corporate veil" and impose liability personally on Don Heilman. In support, the complainant states that Heilman was the sole owner of Marketing Technologies, Inc. and exercised complete authority over all decision-making related to the corporation, including the decision to terminate her employment, and the decision to discontinue the business of the corporation and turn over its clients, production, and products to his new employer, Remark. The complainant argues that "Essentially, Mr. Heilman apparently is attempting to defraud the corporation's creditors who are also his creditors by passing on the business assets from his corporation to a new business and presumably sheltering himself from liability against creditors, including the complainant....To not allow complainant to obtain relief against Mr. Heilman personally would be unfair and allow Mr. Heilman and his corporation to defraud its creditors."

One of the underlying purposes of the corporate structure is the advancement of limited liability of corporate investors. Exceptions to the general rule of limited shareholder liability do exist, however, where "applying the corporate fiction would accomplish some fraudulent purpose, operate as a constructive fraud, or defeat some strong equitable claim..." Consumer's Co-op of Walworth v. Olsen, 142 Wis. 2d 465, 475, 419 N.W.2d 211 (1988), quoting Milwaukee Toy Co. v. Industrial Commission of Wisconsin, 203 Wis. 493, 234 N.W. 748 (1931).

The commission finds that the evidence in this case fails to support grounds for piercing the corporate veil and imposing personal liability on Donald Heilman. For instance, no testimony was elicited regarding the circumstances surrounding the decision to discontinue Marketing Technologies, Inc., as a business. Further, there was testimony at the hearing that the decision to cease doing business was made in "early September (1993)" while the case file shows that the division had first notified the respondents that the complainant had filed a complaint of discrimination via a letter dated September 9, 1993. While the complainant asserts that Marketing Technologies' clients, production and products were turned over to "Remark," there was no evidence as to what percentage of Marketing Technologies' clients went to Remark, and testimony was given that all of Marketing Technologies' work was completed when it went out of business. Except for some unknown percentage of its clients, there was no testimony regarding what, if any, business assets were passed on to Remark. The testimony showed that the equipment used at Marketing Technologies had been leased. Since it also appears that Remark has not acquired any part of Marketing Technologies name, any "good will" associated with the Marketing Technologies name also failed to be passed on to Remark. Additionally, there was no evidence as to whether or not Heilman had any investment interest in Remark. There was testimony by Heilman that he was a salesperson at Remark.

Based upon the above, the commission declines to pierce the corporate veil of Marketing Technologies and impose personal liability on Donald Heilman.


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