CAMDEN, N.J. – A federal judge recently rejected an attempt from Starbucks’ to dismiss a discrimination lawsuit brought by one of its former store managers, concluding that a jury may find that white employees of the coffee giant were treated unfairly due to their race.
Plaintiff Shannon Phillips of Woolwich Township, N.J. initially filed suit against Seattle-based Starbucks on Oct. 28, 2019 in the U.S. District Court for the District of New Jersey.
Phillips claimed the coffee giant discriminated against her and other Caucasian employees in the aftermath of the controversial arrests of two African-American men at a Philadelphia store location.
In April 2018, store customers Donte Robinson and Rashon Nelson were asked to leave a Starbucks coffee shop in Philadelphia after sitting at a table without ordering anything. The men, who did not leave because they were waiting for a business associate, were escorted out of the coffee shop in handcuffs after a store manager called police on them.
Robinson and Nelson later reached settlement agreements with both Starbucks and the City of Philadelphia. The terms included Starbucks undergoing company-wide racial sensitivity training.
Prior to her being let go, Phillips was charged with overseeing Starbucks stores in southern New Jersey, the Philadelphia area, Delaware and parts of Maryland. Two of her subordinates included district managers who oversaw stores in Philadelphia, one of whom included the district manager responsible for the store where Robinson and Nelson were arrested.
In the aftermath of the incident, Phillips claimed she worked to repair community relations after the arrests, but that “Starbucks took steps to punish white employees who weren’t involved in the incident.”
After Starbucks settled with Robinson and Nelson in early May 2018, Phillips alleged she was asked to put one of her district managers, a Caucasian male, on suspension for allegedly paying non-white employees less than their white counterparts.
Phillips’ lawsuit said that was “factually impossible” because district managers did not have the power to set salaried employee compensation, due to Starbucks’ own internal company policies and procedures.
Phillips’ lawsuit stated that the Caucasian male district manager in question had worked for Starbucks for 15 years, and that she had never observed any racially discriminatory comments or conduct from him.
In the lawsuit, Phillips said that same district manager was not responsible for the store where Robinson and Nelson were arrested and had no connection to that incident, but that an African-American district manager who did oversee that store was neither fired nor placed on suspension.
On May 8, 2018, Phillips said she was told she would be fired due to her “situation not being recoverable,” according to her lawsuit. She alleged she was replaced by “substantially less-qualified employees who had not complained of race discrimination.”
A spokesperson for Starbucks had initially denied the claims of Phillips’ lawsuit and said the company is prepared to defend against them in court.
“Starbucks exercised reasonable care to prevent and promptly correct any discriminatory or retaliatory behavior, if any such conduct occurred, and Phillips unreasonably failed to take advantage of any preventative or corrective opportunities provided by Starbucks or to avoid harm otherwise,” the company later added in a March 5, 2020 answer to the complaint.
According to the company, all actions the company took with respect to Phillips were for legitimate, non-discriminatory, non-retaliatory reasons and Starbucks would have taken the same actions regarding Phillips in the absence of any unlawful motivating factor, if such a factor existed.
After a designated placement transfer to a presiding judge from the U.S. District Court for the Eastern District of Pennsylvania in May, a second amended complaint was filed in Aug. 17, 2020 and that in turn was answered by Starbucks on Aug. 27, 2020.
Starbucks filed a motion for summary judgment on Nov. 11, 2021, which argued the Court should dismiss Phillips’ case for multiple reasons, chief among which was her failure to lead during a moment of decision.
The company said Phillips “appeared overwhelmed, ‘completely paralyzed,’ driven by ‘panic,’ and lacked awareness of how critical the situation was for Starbucks and its partners; did not attend scheduled meetings or showed up late; was physically and mentally absent from meetings; was sometimes unreachable by her team; appeared disengaged and stood in the corner at meetings where she was expected to lead or where Starbucks’ executive leadership was present; was unable to respond to questions and did not lead the discussion during partner roundtable sessions and lacked awareness with respect to pay disparities in her market.”
Additionally, the company pointed to the fact that Phillips’ successor was of the same racial background as her.
“Starbucks did not discriminate against Phillips because of her race nor did it retaliate against Phillips because she objected to Benjamin Trinsey’s suspension. Starbucks had legitimate reasons to terminate Phillips – her complete failure to lead her team during a key moment in Starbucks history. Indeed, there is no evidence that creates an inference of discrimination. Camille Hymes [Regional Vice-President for Mid-Atlantic Retail Operations], on whom Phillips pegs the discriminatory animus, hired someone who is the same race as Phillips to replace her, and even recommended Phillips for the TLA position,” the motion stated.
“Moreover, Starbucks did not hire Phillips for the TLA position because it decided to abandon the position and not hire anyone for the position. Because Phillips cannot meet her burden to prove that Starbucks’ decisions related to her employment were a pretext for discrimination, Starbucks is entitled to summary judgment. Accordingly, Starbucks respectfully requests that the Court enter judgment in its favor and against Phillips and dismiss her case with prejudice.”
UPDATE
In an Aug. 31 memorandum opinion, U.S. District Court for the Eastern District of Pennsylvania Judge Joel H. Slomsky (presiding in an assist to the New Jersey federal bench) ruled that Phillips had in fact put forth a prima facie case that she and other Starbucks employees were discriminated against for being white.
The judge pointed to the contrast between manager Paul Sykes, who is Black and was not disciplined subsequent the arrests, and a white manager, Trinsey, who was suspended over a race-related wage equity dispute during the same period, as supporting evidence for Phillips’ claims.
“A dispute of material fact remains as to the circumstances surrounding Mr. Trinsey’s suspension. These circumstances are material because Trinsey was another Caucasian employee who was allegedly discriminated against in the wake of the April 2018 incident. Thus, viewing the facts in the light most favorable to the plaintiff, a jury could find that the circumstances of Trinsey’s suspension give rise to an inference of discrimination to support plaintiff’s prima facie case. Additionally, plaintiff has pointed to evidence that ‘race was definitely the topic of discussion’ in the 27-day period between the April 12, 2018 incident and plaintiff’s termination,” Slomsky stated.
“Further, she cites defendant’s public statement after the incident: ‘Starbucks will continue to take actions that stem from this incident to repair and reaffirm our values and vision for the kind of company that we want to be,’ and asserts that this evidence that Starbucks had an agenda to terminate non-minority employees after the incident. This position is relevant here because the Third Circuit has noted that ‘the Court may also consider as circumstantial evidence the atmosphere in which the company made its employment decisions.’ Therefore, a jury also may find that this evidence gives rise to an inference of discrimination against non-minority employees at Starbucks.”
However, Slomsky also found that Starbucks presented a legitimate, non-discriminatory reason for firing her – her perceived lack of leadership after the arrest incident, her physical and mental absence from meetings and appearing to be overwhelmed by the events surrounding her – and dismissed her retaliation claims.
“The undisputed facts of record show that plaintiff’s objection to Mr. Trinsey’s suspension was premised upon accusations that he is a ‘racist,’ not because she believed Trinsey was being suspended due to his Caucasian race. Thus, a reasonable jury could not find that Phillips engaged in protected activity because Trinsey ‘being perceived as racist is not a protected trait’ under Title VII and the New Jersey Law Against Discrimination,” Slomsky stated.
“Moreover, because plaintiff ‘wrongfully conflates the ideas of race and racism’ and only objected to Trinsey’s suspension on the grounds that he was ‘not a racist,’ she cannot demonstrate a ‘reasonable, good faith belief’ that she engaged in protected activity. Without more, her statements that such treatment was ‘not right’ and ‘unfair’ only amount to a ‘general complaint of unfair treatment,’ which is insufficient to support a retaliation claim. Thus, plaintiff’s opposition to the belief that Trinsey was a racist does not constitute protected activity, and she cannot meet this crucial element of her prima facie case of retaliation.”
The plaintiff is seeking an unspecified amount of compensatory and punitive damages, in addition to legal fees and a declaration from the court that Starbucks violated her civil rights through unlawful employment discrimination.
The plaintiff is represented by Stephen G. Console and Katherine Charbonnier Oeltjen of Console Mattiaci Law in Moorestown, N.J.
The defendant is represented by Hannah Lindgren of Littler Mendelson, in Philadelphia.
U.S. District Court for the District of New Jersey case 1:19-cv-19432
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com