Kenyon Brady Clark began working for Cache Valley Electric Company, an electrical contracting company, in 1998, and became a project manager for the Teledata Division in 2006. In his complaint, he alleged that his supervisor favored another project manager, Melissa Silver, with respect to job assignments, bonuses, and other working conditions because the supervisor was romantically involved with her. Clark also claimed that his supervisor favored females generally, but offered no evidence in support of that contention.
The court threw out Clark's case. The problem, according to the court, was that he presented no evidence that women were treated more favorably than men. Rather, he merely provided evidence that his supervisor favored only one female employee. The court stated that "favoritism of a paramour is not gender discrimination…preferential treatment on the basis of a consensual romantic relationship between a supervisor and an employee is not gender-based discrimination." It's is not illegal to favor one employee over another because they have some kind of special friendship, affinity, or relationship.
Clark also brought a claim for retaliation, which the court discarded as well. It held that he had failed to show he had a reasonable, good faith belief that his employer had retaliated against him for opposing an unlawful employment practice under Title VII. Instead, he was complaining about favoritism, which is not illegal.
The takeaway: Favoritism towards one employee at the expense of another is not illegal, even if a sexual relationship exists between the supervisor and the favored employee. However, if that relationship goes south and then the favored employee is sexually harassed, it's a whole different ballgame.