An employer can be liable for sexual discrimination when a rejected female co-worker intent on revenge was instrumental in the male worker's termination, an appeals court has ruled in overruling a lower court.

Antonio Velázquez-Pérez, who was a regional general manager for Beachwood Ohio-based DDR Corp., which owns and manages shopping centers, interacted frequently with the company's human resources representative in Puerto Rico, Rosa Martinez, according to last week's ruling by the 1st U.S. Circuit Court of Appeals in Boston in Antonio Velázquez-Pérez v. Developers Diversified Realty Corp; DDR PR Ventures II L.L.C.

When Ms. Martinez expressed a romantic interest in Mr. Velázquez, he “gently rebuffed her,” according to the ruling.

During a business trip in April 2008, Ms. Martinez followed Mr. Velázquez to his room, tried to force her way in when he opened the door and then stood outside, according to the ruling. She left when Mr. Velázquez threatened to call security.

Subsequently Ms. Martinez sent Mr. Velázquez threatening emails, including one that said, “I don't have to take revenge on anyone; if somebody knows your professional weaknesses, that person is me.”

Meanwhile Ms. Martinez began sending to Mr. Velázquez's supervisors copies of emails she had sent to him that were critical of his work.

After another encounter at a hotel in August 2008, Mr. Velázquez again rejected her advances. Later that same night, she sent an email to company officials recommending Mr. Velázquez be terminated, which the company did four days later.

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Mr. Velázquez filed suit, accusing the company of sex discrimination and retaliation. The U.S. District Court in Puerto Rico dismissed the charges, but the three-judge appeals panel unanimously reinstated the sex discrimination charge.

A jury “could reasonably decide that Martinez conveyed to Velázquez a threat: Engage in a romantic and sexual relationship with me, or I will manage to undercut you at work and get you fired,” the appeals court ruled.

Although Ms. Martinez was not Mr. Velázquez' supervisor, the company “could nevertheless be found liable for negligently allowing Martinez's discriminatory acts to cause Velázquez's firing,” the court ruled in remanding the case for further proceedings.