Opinion
No. CV-03-0563-PHX-SMM.
August 4, 2006
MEMORANDUM OF DECISION AND ORDER
Pending before the Court are Motions for Summary Judgment filed by Defendant CTVT Motors, Inc. [Doc. No. 75], Defendant Automotive Investment Group-Arizona, Inc. [Doc. No. 77], and Defendant ABC Nissan, Inc. [Doc. No. 79] Plaintiff responded to the Motions for Summary Judgment [Doc. Nos. 89, 91], and Defendants replied to the Responses [Doc. Nos. 97-99]. After considering the arguments raised in the parties' briefs, the Court issues the following Memorandum of Decision and Order. The Court makes it ruling without conducting oral argument, as oral argument would not aid the Court in its determination.
I. BACKGROUND
A. Factual Background
Taking the facts in the light most favorable to Plaintiff, as is required for the purposes of the instant Motions for Summary Judgment, the facts are as follows.
Plaintiff Ernest "C.J." Jackson, who is African-American, was employed by Defendant ABC Nissan, Inc. ("ABC Nissan") from November 1999 until March 2001. (Pl. Decl. ¶ 2, Pl. Dep. 47:19-22.) He was employed by Defendant CTVT Motors, Inc. ("Camelback Toyota") from March 2001 until June 2001. (Pl. Dep. 378:7-10, 454:10-12.) Plaintiff voluntarily returned to work at ABC Nissan in September 2001, and worked there for three weeks before voluntarily resigning. (Id. at 206:11-15.) The Court now recounts the facts as they relate to each period of employment.
"Pl. Dep." refers to the deposition taken of Plaintiff in this litigation. Plaintiff has testified in at least one other deposition in one other civil matter, and the Court will refer separately to that testimony as needed.
1. Plaintiff's employment with ABC Nissan: November 1999 to March 2001
On his application for employment with ABC Nissan, Plaintiff answered the question "Have you ever been convicted of a crime in the last ten years?" negatively. (Id. at 41:2-7.) Actually, however, Plaintiff had been convicted of "false swearing," a class 6 felony, in Maricopa County Superior Court in September 1997. (Id. at 41:8-11, Ex. C to ABC Nissan's SOF.) The employment application warns that false statements or misrepresentations of facts may disqualify the applicant from consideration or result in discharge. (Ex. B to ABC Nissan's SOF Lederman Decl. ¶ 18.) ABC Nissan did not learn of Plaintiff's felony conviction until his deposition in this matter on October 6, 2003. (Ex. B to ABC Nissan's SOF Lederman Decl. ¶ 17.) ABC Nissan maintains that had it known of Plaintiff's felony conviction, it would not have hired him, or would have terminated his employment. (Id. at ¶ 18.) Plaintiff testified at his deposition that he applied for the judgment against him to be vacated and dismissed, and the Clerk of Court instructed him that he could answer questions about convictions negatively because his conviction would be expunged from his record. (Pl. Dep. 41:12-42:8.) However, Plaintiff has provided no evidence demonstrating that his conviction has been expunged as a matter of law.
From November 1999 until March 2000, Plaintiff worked in new car sales at ABC Nissan. (Id. at 52:1-4.) Initially, Plaintiff's immediate supervisor was Steve Dancy. (Id. at 49:22-24.) According to Plaintiff, Dancy called Plaintiff "boy" between 10 and 20 times. (Id. at 121:1-5, 122:13-16.) Dancy would also comment often on where Plaintiff got his clothing from, because Plaintiff wore suits to work. (Id. at 124:17-125:1.) According to Plaintiff, Dancy made comments such as "Well, Black people don't really dress like this, C.J. Where are you getting your clothes from?" (Id. at 124:15-20.) On more than one occasion, Plaintiff responded to Dancy that such comments were unacceptable, and Dancy replied that is the way he speaks. (Id. at 122:17-123:2.)
Dancy's supervisor, Michael Jackson, also called Plaintiff "boy" more than ten times. (Id. at 163:14-19.) Plaintiff confronted Jackson about the use of the word "boy," but Jackson continued calling Plaintiff "boy." (Id. at 163:20-164:6.) Plaintiff again confronted Jackson, but Jackson did not cease the name-calling until Jackson eventually left ABC Nissan for unrelated reasons. (Id. at 164:7-14.)
In March 2000, Plaintiff moved from new car sales to the fleet department, where he was a fleet manager. (Id. at 52:13-15, 56:24.) Though Plaintiff's title was "manager," all fleet salespersons were called "managers." (See Id. at 56:23-24.) Jerry Schwelling was the Fleet Director, and Gary Green was Assistant Fleet Director. (Id. at 56:21-24, 64:17-18.)
In approximately July 2000, Plaintiff's co-worker, Arlin Graff, told Plaintiff that Schwelling had called Plaintiff a "nigger" when Plaintiff was not present. (Id. at 93:8-19, Ex. H to ABC Nissan's SOF.) Plaintiff reported the incident, and John Schneider, ABC Nissan's General Manager investigated the incident. Schneider interviewed Schwelling, who denied making the slur, and another fleet manager, Bob Speary, who also denied that Schwelling used that language. (Schneider Dep. 42:17-20.) Schneider determined that Graff had fabricated the incident and did not reprimand Schwelling. (Id. at 43:10-15, 53:1-17.) Before Schneider was ABC Nissan's General Manager, Schneider was controller at ABC Nissan. During his time as controller, Schneider allegedly called an African-American woman who was a former customer a "crazy nigger" and told an ABC Nissan employee that African-Americans cannot be trusted and African-Americans and Mexicans bounce checks. (Kazakevicious Dep. 31:24-32:4, 78:7-17.)
ABC Nissan objects to the Kazakevicious deposition as inadmissible hearsay and irrelevant. ABC Nissan's objections are overruled, pursuant to FRE 801(d)(2), and because Schneider's statements concerning race are relevant.
On May 25, 2000, Plaintiff wrote Jerry Schwelling a letter. In the letter, Plaintiff requested he be put on the team pay plan, and further told Schwelling:
I must stand up and voice the facts, as I see them, of how your behavior towards me, and my fellow Fleet Team members has been very, very rude and unprofessional. I have been very patient with you and I have endured and persevered through all of your insults and off colored (nothing racial) remarks to me and to my fellow team members . . . what I've experienced working under your leadership is totally out of line with what I'm accustomed to and what I expect from a person who has your tenor in the automobile industry . . . I know that this organization does not plan to go into the new millennium with people like yourself, who doesn't [sic] treat other people with the respect and dignity they deserve.
(Ex. I to ABC Nissan's SOF.) Plaintiff carbon copied John Schneider, ABC Nissan's General Manager, David Arnold, ABC Nissan's general sales manager, Steve Lederman, ABC Nissan's controller, and Gary Green, Assistant Fleet Director for ABC Nissan. (Id.)
On June 1, 2000, Plaintiff overheard David Arnold, ABC Nissan's general sales manager, call two African-American customers "f — king stupid niggers." (Id. at 130:9-23.) Arnold did not realize Plaintiff was in the room until he turned around and saw Plaintiff. (Id. at 130:25-131:3.) Plaintiff reported the incident to Mike Banks, human resources director at ABC Nissan. (Id. at 134:6-135:1, Ex. B to Pl.'s SOF at 3.) Banks advised Plaintiff to call the employee hotline, Auto HR. (Id. at 135:2-3.) Plaintiff also reported the incident to Gary Green, the assistant fleet director, who also advised Plaintiff to call Auto HR. (Id. at 135:24-136:8.) Plaintiff then contacted Auto HR and provided details on the incident. (Id. at 137:20-138:8.) Auto HR and John Schneider investigated the incident. (Id. at 138:12-23, Schneider Decl. ¶¶ 5, 6.) After the investigation, Arnold spoke to Plaintiff. Plaintiff told Arnold that Arnold could not "unring the bell" and that "what's done is done." (Pl. Dep. 147:11-13.) Arnold had no response. (Id. at 147:14-16.)
On a number of occasions, Plaintiff had heard Arnold mocking the speech of African-Americans and Latinos. (Id. at 161:9-162:6.) However, Plaintiff did not report these incidents to management. (Id. at 162:19-163:3.)
When Plaintiff began working in the fleet department, he was not included on the team pay plan like other fleet team members. Under the team pay plan, team members' pay is based on the performance of the entire team. Plaintiff requested to be placed on the team plan, but Schwelling declined Plaintiff's request because Plaintiff's performance was than the rest of the team. (Id. at 65:25-66:3.) Plaintiff believed he was excluded from the team pay plan because of his race. (Id. at 66:2-7.) After the Arnold slur incident, Arnold spoke with Plaintiff and asked Plaintiff how he felt he was being treated in the fleet department. (Id. at 147:17:21.) Arnold also inquired as to Plaintiff's pay situation, and asked to see Plaintiff's numbers and said he would look into the situation. (Id. at 147:21-23.)
On June 6, 2000, Schneider, Schwelling, and Lederman met with Plaintiff to discuss the team pay plan. Plaintiff's "results" were "generally 30 to 50 percent less than any of the other" fleet team members on the team pay plan. (Ex. G to ABC Nissan's SOF.) Schneider informed Plaintiff that Plaintiff would benefit from other team members' higher productivity and that introducing Plaintiff's numbers into the team plan would reduce other members' pay by approximately 20% if Plaintiff were put on the team plan. (Id.) On June 7, 2000, Plaintiff opted to join the team pay plan effective June 1, 2000, on the condition that Plaintiff increase his production to be at least 90% of the average of the other team members' numbers by July 30, 2000. (Id.)
On June 8, 2000, one week after the Arnold slur incident, Arnold's employment was terminated. (Schneider Decl. ¶ 8.) Arnold testified that the incident did not come up when he was terminated. (Arnold Dep. 76:16-18, 114:22-115:1.) Schneider testified that Arnold would have been fired solely on the basis of his lacking job performance, but that the slur was the "icing on the cake." (Schneider Dep. 30:8-31:4.)
Plaintiff also felt Schwelling gave Plaintiff the worst work schedule and work assignments because of his race. Specifically, Plaintiff testified that he "would be scheduled to come in, be the first one in and the last one off," and that he had more "long days" than anyone else. (Pl. Dep. 83:14-18.) Also, Plaintiff would be sent to retrieve cars for other employees from the lot in the middle of summer days. (Id. at 84:2-21.) However, Plaintiff testified that other fleet department employees may have been assigned the same type of tasks. (Id. at 84:22-85:2.) Plaintiff confronted Schwelling about work assignments because of his race, but Schwelling denied singling Plaintiff out. (Id. at 88:15-89:4.) Plaintiff also called the Auto HR hotline in December 2000 to report that he was unfairly written up and not given permission to swap work days with one of his co-workers. (Schneider Decl. ¶ 8.) Race was not mentioned in Plaintiff's complaint to Auto HR. (Id.) John Schneider investigated the complaint and determined that the complaint lacked merit. (Id.)
In addition, Plaintiff overheard Schwelling and Plaintiff's Australian co-worker, Matt Nazar, discussing "what they call Black people in Australia." (Pl. Dep. 67:23-68:7.) Nazar said that black people are called "porch monkeys" and Schwelling repeated the term. (Id. at 68:4-6.) Schwelling also said African-Americans are called "sugar babies" and "coons" in the United States. (Id. at 68:6-12.) Schwelling and Nazar were in the same open area as Plaintiff and saw Plaintiff. (Id. at 99:1-20.) After the incident, Plaintiff confronted Nazar and told Nazar it was offensive and that Plaintiff "didn't appreciate the conversation that [he] overheard." (Id. at 100:15-101:18.) Nazar responded sarcastically and Plaintiff then walked away. (Id. at 101:18-20.) Plaintiff did not confront Schwelling about the incident, and he did not report it to an ABC Nissan supervisor. (Id. at 101:21-102:13.)
Schwelling also referred to Asian customers as "too-highs," and he called another employee, Gabriel Santana, a "wetback" and a "dumb Mexican." (Pl. Dep. 69:19-71:6, 73:11-15, 77:13-15.) Plaintiff complained to John Schneider and called Auto HR about Schwelling's "too-highs" comments. (Id. at 71:21-72:19.) According to Plaintiff, he complained to John Schneider approximately three or four times about his derogatory comments about other minority groups, including Asians, Mexicans, and Native Americans. (Id. at 103:11-104:10.) Plaintiff also confronted Schwelling about his use of the term "too-highs" and his references to Santana as a "wetback." (Id. at 70:3-23, 76:4-22.) A co-worker of Plaintiff's, Elite Trice, also testified that he heard Schwelling use the terms "wetback," "camel jockey," "kike," and "stupid Mexican." (Ex. D to Pl.'s SOF in Opp. to ABC Nissan and Camelback Toyota's Mots. Trice Dep. 12:16-13:20.)
ABC Nissan objects to this deposition for the same reasons as the Kazakevicious deposition. For the reasons stated in footnote 2 supra, the Court overrules those objections.
In addition, Gary Green, the assistant fleet director, called customers of Mexican descent "wetbacks" and "mojados" and he would also customers of Asian descent "too-highs." (Pl. Dep. at 127:2-15.) Green would also mock the way Asian customers spoke. (Id. at 126:22-24.) Green did not engage in slurs directed at African-Americans or at Plaintiff. (Id. at 127:22-24, 129:5-10.) Plaintiff confronted Green about these incidents, but Green did not respond. (Id. at 128:3-9.) Plaintiff does not recall whether he called the employee hotline about Green. (Id. at 128:20-22.)
Also in 2000, Plaintiff's co-workers in the fleet department engaged in racial slurs. Matt Nazar referred to co-worker Gabriel Santana as a "dumb Mexican," "stupid Mexican," and a "wetback." (Id. at 166:2-8.) Nazar would also tell Santana, "You need to go back home, south of the border." (Id. at 166:9-10.) Nazar called customers of Asian descent "too-highs" and African-American customers "thugs." (Id. at 167:9-11, 168:2-12.) Plaintiff did not report these incidents to management. (Id. at 168:18-25.) In addition to Nazar, co-worker Todd Greenberg joked about "wetbacks," "mojados," "too-highs," "Japs," and "spics." (Id. at 171:13-23.) Greenberg also asked Plaintiff the meaning of a saying involving "niggers and flies," to which Plaintiff responded he did not want to discuss it and it was not appreciated in the workplace. (Id. at 170:7-15.) Plaintiff did not report Greenberg's comments to management. (Id. at 171:24-172:3.)
Beginning in December 2000, Plaintiff approached John Schneider about transferring to a different dealership to be in a different environment. (Id. at 175:9-176:4, 376:3-21.) In March 2001, Plaintiff transferred from ABC Nissan to Camelback Toyota. (Id. at 47:23-48:1.) 2. Plaintiff's employment with Camelback Toyota: March 2001 to June 2001
Plaintiff joined Camelback Toyota as a fleet internet salesperson. (Id. at 385:3-5, 386:7-9.) Plaintiff's direct supervisor, and the person who facilitated his transfer from ABC Nissan to Camelback Toyota, was Tommy Oh. (Id. at 176:15-25, 177:17-21.) Oh is Asian-American. (Id. at 392:2-3.)
At his deposition, Plaintiff could not recall his exact title. (See Id. at 385:3-5.)
During his employment with Camelback Toyota, Plaintiff "believe[s]" that minority customers were given higher interest rates on vehicle purchases than non-minority customers. (Pl. Decl. ¶ 52, Pl. Dep. 402:1-20.) Plaintiff complained about this treatment to Oh, who informed him that it was the way business was done because Oh wanted Plaintiff to make as much gross profit on the sale as possible. (Id. at 402:23-403:2, 406:18-407:8.) Oh did not use any racial slurs during conversations regarding interest rates with Plaintiff. (Id. at 411:2-4.)
According to Plaintiff, Oh used racial slurs such as "too-highs," "wetback," and "Jewing down the price" about customers. (Id. at 442:8-443:1.) Plaintiff confronted Oh about his use of those slurs "many" times; it is unclear from the record whether Oh responded. (Id. at 443:2-15.) Plaintiff did not report Oh's comments to management. (Id. at 447:7-18, 449:9-12.) Furthermore, Plaintiff testified that he is not alleging in this lawsuit that Oh did anything to subject Plaintiff to racial harassment. (Id. at 393:16-18.)
In addition to Oh, Plaintiff testified that numerous co-workers used racial slurs. At no time, however, did anyone at Camelback Toyota make any racial comments towards Plaintiff (Id. at 429:20-430:16) or about any co-workers (Id. at 430:17-431:5). Co-workers' racial comments were about customers, and the slurs used were "wetbacks," "Mexicans having mattress money," "too-high," and "Jewing down." (Id. at 439:3, 16-18, 22-24.) Plaintiff cannot identify the names of any of the co-workers who used those terms, however. (Id. at 439:25-440:6.) Plaintiff confronted them on "a couple of occasions," but did not report the incidents to Camelback Toyota management. (Id. at 441:4-442:8.)
Plaintiff also testified that John O'Malley, Camelback Toyota's general manager, once "yelled at" Plaintiff for spending too much time with a customer who was a friend of Plaintiff's. (Id. at 397:22-25.) The customer was African-American. (Id. at 394:1-3.) According to Plaintiff, O'Malley told Plaintiff "we're not here to socialize, we're here to take care of business," and Plaintiff thought O'Malley was "rude" to him. (Id. at 398:2-7.) No references to race were made during the conversation. (Id. at 399:9-11.)
After working for Camelback Toyota for 90 days, Plaintiff voluntarily resigned from employment in June 2001. (Id. at 48:16-18, 454:10-12.) Plaintiff left Camelback Toyota because he sought more money, a better way to care for his family, a better lifestyle, and because he received "a better job offer." (Id. at 189:22-190:7, Pl. Dep. in Torres v. ABC Nissan 7:23-8:3.) Plaintiff's departure from Camelback Toyota was in part due to his "90-day plan," whereby Plaintiff would review his financial situation every 90 days and decide what he was going to do the next quarter. (Pl. Dep. at 190:8-18, Pl. Trial Testimony in Torres v. ABC Nissan 11:7-17.) Plaintiff would "set goals every 90 days," and if he was not reaching those goals, he "would go ahead and go to a different job." (Pl. Trial Testimony in Torres v. ABC Nissan 11:15-17.) Plaintiff also testified at his deposition in this case that he left Camelback Toyota in part because he "was tired of the working environment." (Pl. Dep. 460:16-17.)
Plaintiff left Camelback Toyota in June 2001. (Id. at 470:15-18.) Following his employment with Camelback Toyota, Plaintiff referred family members, who are African-American, to Oh and other former co-worker Sam Sanchez. (Id. at 530:16-531:21.) Plaintiff worked at two subsequent jobs after leaving Camelback Toyota. Plaintiff first worked at Fifth Third Bank for 90 days, and then began working for Heartland Home Finance in August 2001. (Id. at 191:19-193:2.) Plaintiff left Fifth Third because he wanted to earn more money, have a better lifestyle, and better care for his family. (Id. at 193:13-20.)
Plaintiff called ABC Nissan about returning to work there, and spoke with the new fleet director Bill Brixey. (Id. at 195:19-196:4.) Plaintiff asked Brixey if things had changed at ABC Nissan, and Brixey told him that Schwelling and Arnold were no longer there, so things had indeed changed. (Id. at 197:2-9.) Plaintiff said he would return to work there if his terms were met. (Id. at 197:10-11.) Specifically, Plaintiff wanted afternoons and weekends off. (Id. at 197:19-21.) John Schneider agreed to those terms, and Plaintiff agreed to return to ABC Nissan. (Id. at 197:15-18.) Plaintiff also testified that he returned to work there because he "needed the extra income." (Id. at 198:4-6.)
Plaintiff was still employed by Heartland Home Finance when he returned to ABC Nissan in September 2001. (Id. at 203:8-204:20.) Ultimately, Plaintiff resigned from Heartland Home Finance because of a dispute over how much commission Plaintiff earned. (Id. at 194:19-195:8.)
3. Plaintiff's second employment with ABC Nissan: September 2001 to October 2001
While at ABC Nissan the second time, Plaintiff worked again as a fleet manager. (Id. at 202:16-18.) Plaintiff's supervisor was Bill Brixey, who did not subject Plaintiff to racial harassment. (Id. at 202:2-24, 206:23-207:2.) Plaintiff testified at his deposition that the assistant fleet director was possibly Matt Nazar, and Plaintiff "heard Matt" make racially derogatory comments. (Id. at 208:1-16.) Plaintiff did not specify which comments Nazar allegedly made. (Id.) However, Nazar did not work for ABC Nissan when Plaintiff returned in September 2001; Nazar had left ABC Nissan in July 2001. (Lederman Decl. ¶ 12.) Aside from Nazar, Plaintiff stated that "supervisors, ASMs [assistant sales managers], managers" made comments. (Pl. Dep. 208:4-13.) With regard to those supervisors, though, Plaintiff did not provide specific details as to who made such comments or what comments were made.
Plaintiff, however, testified that co-workers used racial slurs. Nathan Long called customers such names as "too-highs" and "spics." (Id. at 211:18-212:9.) Plaintiff confronted Long, but Long did not stop making the comments. (Id. at 212:15-213:13.) Plaintiff did not report those incidents to management, because he had put in complaints during his first period of employment to no avail. (Id. at 212:10-13, 213:25-214:11.) Co-worker Brian Stokes also commented that Mexican customers had credit problems and they could not understand Stokes because of a language barrier. (Id. at 215:10-22.) Plaintiff did not report Stokes' statements to management. (Id. at 218:11-13.) Also, ABC Nissan's finance director Greg Walders used the slur "wetback" to describe customers and co-workers of Mexican descent and commented on their credit problems and "mattress money." (Id. at 216:10-217:5.) Plaintiff did not report Walders' comments to management. (Id. at 218:18-21.)
Plaintiff decided to resign because the environment had not changed. (Id. at 213:3-11.) Plaintiff worked at ABC Nissan for three weeks, from September until October 2001, before voluntarily resigning. (Id. at 206:11-15.)
The entities involved in this case
Prior to March 1999, ABC Nissan, Inc. was known as Automotive Investment Group, Inc., or "AIG, Inc." (Ex. 2 to Pl.'s SOF in Opp. to AIG-AZ's Mot.) Automotive Investment Group-Arizona, Inc., or "AIG-AZ," is an auto dealership management consulting company that was incorporated in 1998 and contracts with both ABC Nissan and Camelback Toyota to provide consulting services. (Id., Exs. B-1 and B-2 to AIG-AZ's Mot.)
B. Procedural Background
Plaintiff filed a Complaint against Defendants in this Court on March 25, 2003. [Doc. No. 1] Plaintiff filed an Amended Complaint in March 2004 [Doc. Nos. 49, 50], and that Amended Complaint was stricken by Order filed December 17, 2004. [Doc. No. 63] Plaintiff filed a Second Amended Complaint on January 18, 2005, alleging two counts: hostile work environment and constructive discharge in violation of 42 U.S.C. § 1981. [Doc. No. 65]
On September 30, 2005, ABC Nissan, Camelback Toyota, and AIG-AZ each filed separate Motions for Summary Judgment. [Doc. Nos. 75, 77, 79] Plaintiff responded jointly to ABC Nissan and Camelback Toyota's Motions and also to AIG-AZ's Motion on November 18, 2005 [Doc. Nos. 89, 91], and each Defendant replied separately on December 5, 2005. [Doc. Nos. 97, 98, 99] ABC Nissan and AIG-AZ also filed Objections to Plaintiff's Statement of Facts on December 5, 2005. [Doc. Nos. 100, 101]
This matter was previously assigned to the Honorable Earl H. Carroll, who recused from further participation in this action on January 5, 2006. [Doc. No. 102]
The Court's exercise of jurisdiction over this case is proper under 28 U.S.C. § 1331, because the matter in controversy arises under the laws of the United States. Venue is proper pursuant to 28 U.S.C. § 1391(b).
II. MOTIONS FOR SUMMARY JUDGMENT
A. Standard of ReviewA court must grant summary judgment if the pleadings and supporting documents, viewed in the light most favorable to the nonmoving party, "show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." FED. R. CIV. P. 56(c); see Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Jesinger v. Nevada Fed. Credit Union, 24 F.3d 1127, 1130 (9th Cir. 1994). Substantive law determines which facts are material. See Anderson v. Liberty Lobby, 477 U.S. 242, 248 (1986); see also Jesinger, 24 F.3d at 1130. "Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment." Anderson, 477 U.S. at 248. The dispute must also be genuine, that is, the evidence must be "such that a reasonable jury could return a verdict for the nonmoving party." Id.; see Jesinger, 24 F.3d at 1130.
A principal purpose of summary judgment is "to isolate and dispose of factually unsupported claims." Celotex, 477 U.S. at 323-24. Summary judgment is appropriate against a party who "fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 322;see also Citadel Holding Corp. v. Roven, 26 F.3d 960, 964 (9th Cir. 1994). The moving party need not disprove matters on which the opponent has the burden of proof at trial. See Celotex, 477 U.S. at 323-24. The party opposing summary judgment "may not rest upon the mere allegations or denials of [the party's] pleadings, but . . . must set forth specific facts showing that there is a genuine issue for trial." FED. R. CIV. P. 56(e); see Matsushita Elec. Indus. Co. v. Zenith Radio, 475 U.S. 574, 585-88 (1986); Brinson v. Linda Rose Joint Venture, 53 F.3d 1044, 1049 (9th Cir. 1995).
B. Discussion: ABC Nissan and Camelback Toyota's Motions for Summary Judgment
The Court addresses Plaintiff's two claims in turn. For each claim, the Court considers each period of Plaintiff's employment separately: first, Plaintiff's period of employment with ABC Nissan; second, Plaintiff's employment with Camelback Toyota; and third, Plaintiff's second period of employment with ABC Nissan.
1. Hostile Work Environment
To establish a hostile work environment under 42 U.S.C. § 1981 or Title VII, Plaintiff must demonstrate that (1) he was subjected to verbal or physical conduct based on his race; (2) the conduct was unwelcome; and (3) the conduct was sufficiently severe or pervasive to alter the conditions of his employment and create an abusive work environment. Manatt v. Bank of Am., N.A., 339 F.3d 792, 797-98 (9th Cir. 2003).
Plaintiff must therefore show that the workplace was both objectively and subjectively hostile. Nichols v. Azteca Rest. Enters., 256 F.3d 864, 871-72 (9th Cir. 2001). In determining whether a work environment is objectively hostile, courts look at "all the circumstances" and consider such factors as "frequency of the discriminatory conduct; its severity; whether it is physically threatening or humiliating, or a mere offensive utterance; and whether it unreasonably interferes with an employee's work performance." Harris v. Forklift Systems, Inc., 510 U.S. 17, 23 (1993). "The required level of severity or seriousness varies inversely with the pervasiveness or frequency of the conduct." Nichols, 256 F.3d at 872 (internal quotation marks and citation omitted). Also, because "allegations of a racially hostile workplace must be assessed from the perspective of a reasonable person belonging to the racial or ethnic group of the plaintiff," the Court considers whether Plaintiff's workplace was hostile from the perspective of the reasonable African-American. McGinest v. GTE Serv. Corp., 360 F.3d 1103, 1115 (9th Cir. 2004).
Against this backdrop, the Court now considers each of Plaintiff's periods of employment.
a. ABC Nissan: First period of employment
Mindful of the need to consider the "all of the circumstances,"Harris, 510 U.S. at 23, the Court nonetheless finds it helpful to first separately discuss two categories of the alleged harassment: harassment by supervisors and harassment by co-workers. This distinction is crucial, as "[a]n employer's liability for harassing conduct is evaluated differently when the harasser is a supervisor as opposed to a coworker." McGinest, 360 F.3d at 1119.
i. Supervisors as harassers
"An employer is vicariously liable for a hostile work environment created by a supervisor, although such liability is subject to an affirmative defense." Id. Although ABC Nissan urges this Court to look primarily at whether the incidents were reported to management or the employee hotline [Doc. No. 79 at 8], the Court must focus on "whether the harasser has immediate or successively higher authority over the victim of the harassment, not on whether the employer knew of the harassment."Burrell v. Star Nursery, Inc., 170 F.3d 951, 956 (9th Cir. 1999). Therefore, "if the harassment is actionable and the harasser has supervisory authority over the victim," the Court will presume an employer's vicarious liability for the harassment. Id. That presumption can only be overcome if no tangible employment action was taken, and if a two-prong affirmative defense established by the Supreme Court inBurlington Indus., Inc. v. Ellerth, 524 U.S. 742 (1998) and Faragher v. City of Boca Raton, 524 U.S. 755 (1998) can be shown by the employer. Id.
The affirmative defense is commonly known as the "Ellerth/Faragher defense." See, e.g., Pennsylvania State Police v. Suders, 542 U.S. 129, 140 (2004).
Accordingly, the Court will first determine whether the harassment is actionable and whether the harasser has supervisory authority over the victim. The Court considers separate incidents of harassment in turn.
A. Supervisors calling Plaintiff "boy"
According to Plaintiff, his direct supervisor in the new car sales department, Steve Dancy, and Dancy's supervisor, Michael Jackson, each referred to Plaintiff as "boy" more than ten times. Plaintiff reports confronting both Dancy and Jackson about those comments, but neither one stopped using the term.
In Ash v. Tyson Foods, Inc., the Supreme Court noted that use of the word "boy," without any racial modification such as "black" or "white," may be evidence of racial animus. 126 S.Ct. 1195, 1197 (2006) (per curiam). Whether the term evidences racial animus depends on "various factors including context, inflection, tone of voice, local custom, and historical usage." Id.
Here, taking the facts in the light most favorable to Plaintiff, the Court concludes that a jury could find the use of "boy" as evidence of discrimination. The context in which the comments were made is a workplace in which racial slurs about various minorities were made on a regular basis, according to Plaintiff. In addition, Dancy often commented to Plaintiff about Plaintiff's dress and questioned where Plaintiff, an African-American, would get his suits. Also, Plaintiff specifically confronted both Dancy and Jackson about the use of the term "boy" and how it was disrespectful, but neither of them ceased their use of the term. Taken in that context, "boy" could be considered evidence of discrimination by a reasonable jury.See Id. In addition, both Dancy and Jackson had supervisory authority over Plaintiff. Thus, a presumption of ABC Nissan's vicarious liability for these episodes arises. See Burrell, 170 F.3d at 956. That presumption can be overcome only if no tangible employment action was taken and ABC Nissan can establish a two-part affirmative defense.
A tangible employment action "constitutes a significant change in employment status, such as hiring, firing, failing to promote, reassignment with significantly different duties, or a decision causing a significant change in benefits." Ellerth, 524 U.S. at 761. A constructive discharge precipitated by a supervisor's "official act" may qualify as a tangible employment action.Pennsylvania State Police v. Suders, 542 U.S. 129, 140-41 (2004). For reasons described in Section II.2.A, infra, the Court concludes that a genuine issue of material fact exists as to Plaintiff's constructive discharge claim. Thus, the Court will not consider an affirmative defense by ABC Nissan, as it is not available to ABC Nissan if Plaintiff can prove constructive discharge.
B. Manager calling African-American customers "niggers" and Plaintiff's supervisor calling Plaintiff "nigger"
On one occasion, ABC Nissan's general sales manager, David Arnold, called African-American customers "niggers" in Plaintiff's presence. Arnold, however, did not know Plaintiff was in the room, and Arnold was terminated a week later. On another occasion, Plaintiff's supervisor, Jerry Schwelling, called Plaintiff a "nigger" to another employee. Plaintiff was not present during that incident. John Schneider, ABC Nissan's general manager, investigated the Schwelling incident and determined it was fabricated because Schwelling and another witness denied it occurred. However, there is also testimony that Schneider himself has used the racial slur "nigger" in the past.
"It is beyond question that the use of the word `nigger' is highly offensive and demeaning, evoking a history of racial violence, brutality, and subordination. This word is `perhaps the most offensive and inflammatory racial slur in English, . . . a word expressive of racial hatred and bigotry." McGinest, 360 F.3d at 1116 (quoting Swinton v. Potomac Corp., 270 F.3d 794, 817 (9th Cir. 2001)). Indeed, "[p]erhaps no single act can more quickly alter the conditions of employment and create an abusive working environment than the use of an unambiguously racial epithet such as `nigger' by a supervisor in the presence of his subordinates." Id. (quoting Rodgers v. Western-Southern Life Ins. Co., 12 F.3d 668, 675 (7th Cir. 1993)). A presumption of liability therefore arises because Arnold held a supervisory position and his conduct is actionable. See Burrell, 170 F.3d at 956. Because the Court finds an issue of fact exists as to whether a constructive discharge for this period of Plaintiff's employment occurred, the Ellerth/Faragher defense is not available to ABC Nissan.
In addition to the Arnold incident is Schwelling's use of the slur. Taking the facts in the light most favorable to Plaintiff, Schwelling called Plaintiff a "nigger" and the person assigned to investigate the incident has also used that slur. That incident, taken in conjunction with other slurs used by Schwelling about African-Americans in Plaintiff's presence such as "coon," "sugar babies," and "porch monkey," could be found by a reasonable jury to evidence racial hostility in the workplace. Because Schwelling was in a supervisory position over Plaintiff and the conduct could be found actionable by a jury, the presumption of liability arises. See Id. For reasons stated, supra, the affirmative defense is not available to ABC Nissan because a genuine issue of material fact as to whether a constructive discharge occurred in this case.
The Court notes that Plaintiff also testified that he was given different work assignments and work schedule because of his race. However, Plaintiff did not mention race in his complaint to management and details on what precisely the complaint entailed are sparse; it appears from the record the complaint to the hotline was only about an inability to swap workdays, and it is not apparent that a general scheduling/work assignment problem was reported.
C. Managers using slurs about other racial groups
According to Plaintiff, two ABC Nissan managers used slurs about racial groups other than African-Americans in the workplace. First, Jerry Schwelling referred to customers of Asian descent as "too-highs" and called another employee, Gabriel Santana, a "wetback" and a "dumb Mexican." Plaintiff confronted Schwelling and reported the "too-highs" remarks to Schneider. Another employee, Elite Trice, also testified that he heard Schwelling use the terms "wetback," "camel jockey," "kike," and "stupid Mexican." In addition, Gary Green, the assistant fleet director, called customers of Mexican descent "wetbacks" and "mojados," and customers of Asian descent "too-highs." Green also mocked the way Asian customers spoke. Plaintiff confronted Green about these incidents, but Green did not respond.
ABC Nissan notes the letter Plaintiff sent Schwelling that stated "I have endured and persevered through all of your insults and off colored ( nothing racial) remarks to me and to my fellow team members" (Ex. I to ABC Nissan's SOF) (emphasis added). Although Plaintiff stated that Schwelling had said "nothing racial," the Court notes that the date of the letter was May 25, 2000, before the incident reported by Graff, and months before Plaintiff left ABC Nissan.
ABC Nissan contends that Plaintiff may not base his hostile work environment on Schwelling and Green's comments about other racial groups. [Doc. No. 79 at 10.] ABC Nissan, however, does not cite any Ninth Circuit law for its contention. The Court notes the Ninth Circuit's observation in McGinest that "if racial hostility pervades a workplace, a plaintiff may establish a violation of Title VII, even if such hostility was not directly targeted at plaintiff." 360 F.3d at 1117; see also Woods v. Graphic Communications, 925 F.2d 1195, 1202 (9th Cir. 1991) (holding that work environment was racially hostile when plaintiff "was surrounded by racial hostility, and subjected directly to some of it."). The Court concludes that Schwelling and Green's comments about other racial groups, when viewed cumulatively with other instances of racial slurs in Plaintiff's first period of employment with ABC Nissan, raise an issue of triable fact as to a hostile work environment. Because Schwelling and Green were Plaintiff's supervisors and their conduct may be actionable, the presumption of liability arises. See Burrell, 170 F.3d at 956. The two-part affirmative defense is not available to ABC Nissan because there is also an issue of triable fact as to whether a constructive discharge, or tangible employment action, took place.
The legal principles guiding a court's analysis of a Title VII claim "apply with equal force in a § 1981 action." Manatt, 339 F.3d at 797.
ii. Co-workers using slurs about other racial groups
The Court now considers the use of racial slurs by Plaintiff's co-workers, rather than Plaintiff's supervisors. Plaintiff testified that co-workers Nazar and Greenberg used racial slurs; however, Plaintiff did not report any of those incidents to ABC Nissan management. "If . . . the harasser is merely a co-worker, the plaintiff must prove that . . . the employer knew or should have known of the harassment but did not take adequate steps to address it." McGinest, 360 F.3d at 1119 (quoting Swinton, 270 F.3d at 803) (first ellipsis added, second ellipsis in original). Plaintiff has not demonstrated that ABC Nissan management had notice of these incidents. Thus, the Court concludes that these incidents cannot be considered in Plaintiff's hostile work environment claim.
iii. Conclusion as to ABC Nissan: first period of employment
The Court concludes that the acts by ABC Nissan supervisors, taken cumulatively, constitute a hostile working environment for the reasonable African-American. The Court must now, however, look at whether the workplace was subjectively hostile. That is, Plaintiff must also have perceived his workplace to be racially hostile.
ABC Nissan emphasizes the fact that Plaintiff voluntarily returned to work at ABC Nissan within approximately six months to work at ABC Nissan. The Ninth Circuit has alluded that a plaintiff's voluntary return to the supposedly hostile environment may call subjective hostility into question. See Manatt, 339 F.3d at 799, n. 6 ("In considering whether [plaintiff] subjectively perceived her work environment as abusive, we think that [her] efforts to return to [hostile workplace] are relevant."); see also French v. Eagle Nursing Home, Inc., 973 F.Supp. 870, 877-78 (D. Minn. 1997) ("The only logical conclusion that the Court can draw from [plaintiff's] wish to return to [employer] is that the working conditions there were in fact not intolerable."). However, the Court notes that Plaintiff complained of racial slurs twice through the employer's official channels, and repeatedly confronted supervisors and co-workers about their offensive language. Taking the facts in the light most favorable to Plaintiff, the Court concludes that Plaintiff's complaints sufficiently show that he perceived his workplace to be hostile. The Court further notes that Plaintiff returned to ABC Nissan upon assurances that the environment had changed because Arnold and Schwelling were no longer at ABC Nissan. Therefore, the Court will deny ABC Nissan's Motion for Summary Judgment as to hostile work environment during Plaintiff's first period of employment.
b. Camelback Toyota
The Court considers first whether Plaintiff's work environment at Camelback Toyota was objectively hostile. Then, the Court looks at whether the work environment was perceived by Plaintiff to be hostile.
At the outset, the Court notes that Plaintiff has failed to respond to the vast majority of the arguments presented in Camelback Toyota's Motion for Summary Judgment. Plaintiff testified at deposition as to certain conduct that he alleges occurred at Camelback Toyota, yet does not mention any of those Camelback Toyota-specific events or cite a single case supporting opposition to summary judgment with respect to those events. Plaintiff's complete lack of response to Camelback Toyota's arguments regarding the disparity in interest rates offered to minority customers, and lack of evidence to support the interest rate allegation, is fatal to his hostile work environment claim to the extent that his claim is based on interest rate disparities. See Celotex, 477 U.S. at 322-24. It is not the Court's duty to make Plaintiff's arguments for him, and the Court is unaware of case law that supports the proposition that a plaintiff's "belief" that minority third parties (who are not co-workers) were treated differently than non-minority third parties demonstrates the elements required for a hostile work environment claim. See Manatt, 339 F.3d at 797-98 (listing the elements of a hostile work environment claim: (1) plaintiff was subjected to verbal or physical conduct based on his race; (2) the conduct was unwelcome; and (3) the conduct was sufficiently severe or pervasive to alter the conditions of his employment and create an abusive work environment). At most, a claim regarding treatment of third parties may show some racial hostility in the workplace. See McGinest, 360 F.3d at 1117 ("if racial hostility pervades a workplace, a plaintiff may establish a violation of Title VII, even if such hostility was not directly targeted at plaintiff"). However, Plaintiff has not provided the Court with any evidence of such treatment; Plaintiff has merely expressed his "belief" that such conduct occurred. While Plaintiff's "belief" may be sufficient at the pleading stage, it is wholly insufficient at the summary judgment stage.See Celotex, 477 U.S. at 322-24. Thus, because conclusory allegations and unsupported contentions are insufficient at the summary judgment stage, the Court therefore cannot conclude that a hostile work environment existed with regard to these alleged practices.
In his Statement of Facts in opposition to Camelback Toyota's Motion, Plaintiff states that he " believed that Camelback Toyota employees" based interest rates on minority status. (Pl.'s SOF ¶ 52) (emphasis added). Plaintiff has provided no evidence showing that interest rates varied based on a customer's race, however.
Plaintiff also alleges that John O'Malley, Camelback Toyota's general manager, was "rude" to him when O'Malley admonished Plaintiff for apparently spending too much time with an African-American customer who was a friend of Plaintiff's. O'Malley told Plaintiff "we're not here to socialize." However, offhand comments and isolated incidents (unless extremely serious) will not amount to a discriminatory change in the terms and conditions of employment. Clark County Sch. Dist. v. Breeden, 532 U.S. 268, 271 (2001). O'Malley also made no mention of race. Even if the Court were to assume O'Malley made his remark because of race, the remark was, at most, an isolated, offhand comment that is not "extremely serious" under controlling case law. See Faragher v. City of Boca Raton, 524 U.S. 775, 788 (1998); see also Brooks v. City of San Mateo, 229 F.3d 917, 925-26 (9th Cir. 2000). The remark is therefore not actionable.
Furthermore, even if Plaintiff's allegations regarding treatment of customers were taken into account with the remainder of Plaintiff's statements about racial comments by fellow Camelback Toyota employees, Plaintiff has not established a hostile work environment claim. The Court first addresses Plaintiff's allegations about the use of slurs by his supervisor, Tommy Oh. The Court will then consider Plaintiff's allegations regarding co-workers.
Plaintiff testified at his deposition that his direct supervisor, Tommy Oh, an Asian-American, used racial slurs about customers of Asian, Mexican, and Jewish descent. For an employer to be liable for the actions of a supervisor, the harassing conduct must be actionable. Burrell, 170 F.3d at 956. The Court concludes that those comments do not constitute a hostile work environment. Although racial hostility need not be directly targeted at Plaintiff to establish a hostile work environment claim, Plaintiff has not provided sufficient evidence that "racial hostility pervade[d] [his] workplace." See McGinest, 360 F.3d at 1117. Thus, Oh's comments are not actionable and Camelback Toyota cannot be liable for the alleged harassment. Furthermore, the Court notes Plaintiff's own testimony that he does not allege in this lawsuit that Oh did anything to subject Plaintiff to racial harassment. (Pl. Dep. 393:16-18.)
Regarding the alleged comments by co-workers about minority customers, the Court notes that Plaintiff has failed to provide any specific information as to which co-workers made comments. Additionally, Plaintiff did not report any racial comments by his co-workers to Camelback Toyota management. As the Court has iterated supra, "[i]f . . . the harasser is merely a co-worker, the plaintiff must prove that . . . the employer knew or should have known of the harassment but did not take adequate steps to address it." McGinest, 360 F.3d at 1119 (quoting Swinton, 270 F.3d at 803) (first ellipsis added, second ellipsis in original). Because Plaintiff has not demonstrated that Camelback Toyota management had notice of these incidents, the Court will not consider them in Plaintiff's hostile work environment claim.
Therefore, because Plaintiff has failed to show that an objectively hostile work environment exists, even when the facts are taken in the light most favorable to him and all the circumstances are considered, the Court need not address subjective hostility and will grant Camelback Toyota's Motion for Summary Judgment as to hostile work environment. See Celotex, 477 U.S. at 322.
For reasons stated in footnote 18, infra, the Court rejects any claim by Plaintiff that Camelback Toyota is liable for the acts of ABC Nissan.
c. ABC Nissan: Second period of employment
First, the Court considers whether Plaintiff's work environment was objectively hostile. During Plaintiff's second period of employment with ABC Nissan, Plaintiff alleges that comments were made by co-workers and supervisors about other racial groups. However, Plaintiff provides no information specifying which supervisor made racially derogatory statements, or identifying precisely what was saId. At the summary judgment stage, Plaintiff must proffer more than conclusory statements. Thus, the Court will not consider remarks made by supervisors during Plaintiff's second period of employment with ABC Nissan.
Plaintiff furnishes details on comments by co-workers; however, Plaintiff did not report any of those incidents to ABC management. When the harasser is a co-worker, a "plaintiff must prove that . . . the employer knew or should have known of the harassment but did not take adequate steps to address it." McGinest, 360 F.3d at 1119 (quoting Swinton, 270 F.3d at 803) (ellipsis in original). Here, Plaintiff has not shown that ABC Nissan had notice of those instances of harassment. Because Plaintiff as failed to demonstrate the workplace was objectively hostile, the Court need not reach the issue of subjective hostility, and summary judgment as to hostile work environment during Plaintiff's second period of employment with ABC Nissan is appropriate. See Id. 2. Constructive Discharge
Apparently, one of the harassers was "finance director" for ABC Nissan. Even if the finance director is a supervisor, Plaintiff has not shown that he had "immediate (or successively higher) authority over" Plaintiff as required for employer liability. McGinest, 360 F.3d at 1119 n. 13 (quotingFaragher, 524 U.S. at 806). That is, Plaintiff has not demonstrated that the finance director "has the authority to demand obedience from" Plaintiff. Id.
A constructive discharge occurs when an employee is forced to quit because of intolerable and discriminatory working conditions. See Schindrig v. Columbia Mach., Inc., 80 F.3d 1406, 1411 (9th Cir. 1996) (citation omitted). The Court's constructive discharge inquiry "is objective: Did working conditions become so intolerable that a reasonable person in the employee's position would have felt compelled to resign?"Suders, 542 U.S. at 141. Normally, whether working conditions are so intolerable and discriminatory as to compel an employee to resign in a question left to a jury; however, a plaintiff "must show some aggravating factors, such as a continuous pattern of discriminatory treatment" to establish a constructive discharge claim. Schindrig, 80 F.3d at 1411-12. "Summary judgment is therefore appropriate on a constructive discharge claim where the decision to resign was unreasonable as a matter of law." Lawson v. Washington, 296 F.3d 799, 805 (9th Cir. 2002).
The Court now applies this legal standard to each of Plaintiff's periods of employment.
a. ABC Nissan: First period of employment
In this case, Plaintiff transferred from ABC Nissan to Camelback Toyota. Assuming that a transfer to a new work location is the equivalent of a resignation, the Court considers the facts surrounding Plaintiff's departure from ABC Nissan after his first period of employment.
The parties appear to assume this in their briefs, as it is not discussed.
In an unrelated civil matter, Plaintiff provided sworn testimony regarding the reasons he left ABC Nissan in March 2001. When directly questioned as to why he left ABC Nissan, Plaintiff answered, "I needed a better opportunity to make some more money, career advancement." (Pl. Dep. in Torres v. ABC Nissan at 7:20-22.) Plaintiff made absolutely no mention of racial harassment during this sworn testimony. ABC Nissan urges the Court to find there was no constructive discharge based on Plaintiff's prior testimony and the fact that Plaintiff voluntarily returned to ABC Nissan just six months after first leaving.
Although Plaintiff has previously testified as to why he left and agrees that he returned to work at ABC Nissan, the Court also notes other testimony Plaintiff has given. At his deposition in this case, Plaintiff testified that he approached John Schneider about transferring from ABC Nissan to Camelback Toyota "[b]ecause I was having too much stress in the environment — the environment in the fleet department where I was working was bad and so I wanted to go to a different environment." (Pl. Dep. at 175:2-16.) Regarding his return to ABC Nissan, Plaintiff testified in this case that he called ABC Nissan and spoke with the new fleet director about returning to work there. (Id. at 195:19-197:3.) Plaintiff asked the fleet director if things had changed at ABC Nissan, and he was told they had because Arnold and Schwelling were no longer there. (Id. at 197:4-9.) Plaintiff then told the fleet director "I might be interested in coming back if I can work on my terms," which were to have afternoons and Sundays off. (Id. at 197:10-21.) Schneider agreed to those terms and Plaintiff returned to work at ABC Nissan. (Id. at 197:15-18.) At his deposition in this case, Plaintiff further testified that he returned to ABC Nissan because he "needed the extra income." (Id. at 198:4-6.)
Based on Plaintiff's testimony and taking the pertinent facts in a light most favorable to Plaintiff, the Court concludes that a triable issue of fact exists on Plaintiff's constructive discharge claim. Whether a reasonable person would feel compelled to resign based on the circumstances is ordinarily a question left to the jury, and the Court concludes that a jury could find, taking all the facts in the light most favorable to Plaintiff, that a continuous pattern of discriminatory treatment existed at ABC Nissan during Plaintiff's first period of employment. Although credibility issues have been raised as to a number of people and incidents, the Court leaves those questions for the jury to resolve.
b. Camelback Toyota and ABC Nissan: Second period of employment
To establish a constructive discharge, Plaintiff must show that a reasonable person would be compelled to leave due to the discriminatory treatment. See Schindrig, 80 F.3d at 1411. "Where a plaintiff fails to demonstrate the severe or pervasive harassment necessary to support a hostile work environment claim, it will be impossible for her to meet the higher standard of constructive discharge." Brooks, 229 F.3d at 930. Because the Court concluded in Section II.B.1.b and c, supra, that Plaintiff cannot establish as a matter of law a hostile work environment as to his employment with Camelback Toyota or his second period of employment with ABC Nissan, Plaintiff's constructive discharge claims as to those periods of employment must also fail. Accordingly, the Court will grant ABC Nissan's Motion for Summary Judgment as to Plaintiff's second period of employment constructive discharge claim and Camelback Toyota's Motion for Summary Judgment as to Plaintiff's constructive discharge claim. 3. After-acquired evidence doctrine
Furthermore, the Court notes that Plaintiff himself testified that his decision to leave Camelback Toyota was only in part because he was tired of the working environment. Notably, Plaintiff testified in his deposition and trial testimony in an unrelated case, as well as his deposition in this case, that he left because he wanted to make more money. (Pl. Dep. in Torres v. ABC Nissan 7:23-8:3, Pl. Trial Testimony in Torres v. ABC Nissan 11:7-17, Pl. Dep. at 189:22-190:7.) Plaintiff had a "90-day plan" where he would assess whether he was earning enough money; if he was not meeting his goals, Plaintiff would change jobs. (Pl. Dep. at 190:8-18, Pl. Trial Testimony in Torres v. ABC Nissan 11:7-17.) Leaving in part because he was "tired of the working environment" at Camelback Toyota does not demonstrate that the environment was so intolerable that a reasonable person would feel compelled to leave. (See Pl. Dep. 460:16-17.)
ABC Nissan contends that under the after-acquired evidence doctrine, Plaintiff's economic damages in this case should barred after October 6, 2003, the date Plaintiff testified at his deposition that he had in fact been convicted of a felony when he had represented on his employment applications that he had not. Under the after-acquired evidence doctrine, an employer's discovery of evidence that an employee could have been discharged for a non-discriminatory reason may limit plaintiff's remedies. ABC Nissan includes this argument in its Motion for Summary Judgment; however, the after-acquired evidence doctrine "does not warrant the granting of summary judgment," as it does not absolve an employer from liability. Schindrig, 80 F.3d at 1412; see O'Day v. McDonnell Douglas Helicopter Co., 79 F.3d 756, 759 (9th Cir. 1996). Rather, the doctrine "bear[s] upon the specific remedy to be ordered." Schindrig, 80 F.3d at 1412. Regardless, the issue of damages is one that must be resolved prior to trial, and in the interest of judicial economy, the Court will address ABC Nissan's arguments at this time.
The after-acquired evidence doctrine is applicable in Title VII cases, Rivera v. NIBCO, Inc., 364 F.3d 1057, 1071 (9th Cir. 2004); therefore, it also applies to this § 1981 action. See Manatt, 339 F.3d at 797 (holding that the legal principles guiding a court's analysis of a Title VII claim "apply with equal force in a § 1981 action.")
The Court also notes that Plaintiff did not contend in opposition to the Motion that the after-acquired evidence argument is not properly raised.
On his employment application with ABC Nissan, Plaintiff indicated that he had not been convicted of a felony when in fact he had been convicted of "false swearing," a Class 6 felony, two years earlier. (Pl. Dep. 41:2-11, Ex. C to ABC Nissan's SOF.) The application states that false statements, material omissions, or misrepresentations of facts may disqualify the applicant from consideration or result in discharge. (Ex. B to ABC Nissan's SOF Lederman Decl. ¶ 18.) The sworn affidavit of Steve Lederman, controller for ABC Nissan, states that "had ABC Nissan known that [Plaintiff] misrepresented a felony false swearing conviction in connection with delinquent child support obligations when he completed his employment application, it would not have hired him, or would have terminated his employment." (Id.) In response to ABC Nissan's argument regarding this after-acquired evidence, Plaintiff argues that ABC Nissan "has failed to adduce any evidence that it has ever not hired or terminated an employee under similar circumstances." [Doc. No. 91 at 10.] Plaintiff cites no legal support for his proposition. [Id.]
In O'Day, the Ninth Circuit applied the after-acquired evidence doctrine to a situation similar to the circumstances at bar and found that an employer could prevail on this doctrine where an affidavit by the employer averring that the employer would have terminated plaintiff for his conduct is furnished and is corroborated by a company's policy and common sense. 79 F.3d at 762. Contrary to Plaintiff's assertion, this Court "could hardly require employers in these cases to come forward with proof that they discharged other employees for the precise misconduct at issue." Id.
Here, ABC Nissan has proffered the sworn affidavit of an official who avers that Plaintiff would have been terminated or not hired in the first place if ABC Nissan had known of his misrepresentation on his application. Also, the application itself states that any misrepresentations, omissions, or false statements would result in termination or disqualification of an applicant. Furthermore, Plaintiff's prior conviction was for the precise conduct the application specifically bars: making a false statement. The Court therefore concludes that the after-acquired evidence doctrine applies in this case. Accordingly, should a jury find ABC Nissan liable for backpay, it shall be limited "from the date of the unlawful discharge to the date the new information was discovered." McKennon v. Nashville Banner Pub. Co., 513 U.S. 352, 362 (1995); O'Day, 79 F.3d at 759. In addition, ABC Nissan "does not have to offer reinstatement or provide front pay." O'Day, 79 F.3d at 759.
4. Camelback Toyota's Request for Attorneys' Fees
Camelback Toyota requests that the Court award it attorneys' fees in defending Plaintiff's claims against it. [Doc. No. 75 at 14-16.] In Christianburg Garment Co. v. EEOC, the Supreme Court held that a prevailing defendant in a Title VII case could be awarded attorneys' fees if "a court finds that [plaintiff's] claim was frivolous, unreasonable, or groundless, or that the plaintiff continued to litigate after it clearly became so." 434 U.S. 412, 422 (1978). The legal principles guiding a court's analysis of a Title VII claim "apply with equal force in a § 1981 action." Manatt, 339 F.3d at 797.
Plaintiff did not address Camelback Toyota's request in his Opposition to Camelback Toyota's Motion for Summary Judgment.
Here, Plaintiff has come forth with no evidence to support his belief that minority customers are treated differently than non-minority customers, and Plaintiff's complaints about his supervisors do not rise to the level of a hostile work environment. Further, Plaintiff did not report any alleged racial remarks by co-workers to management, so liability may not attach to their comments. Although it may not have been clear at the outset that his claims against Camelback Toyota were not actionable, discovery and legal research would have clear to Plaintiff that the conduct alleged simply does not rise to the level of a pervasive, hostile work environment. In addition, because Plaintiff cannot demonstrate a hostile work environment existed, Plaintiff's constructive discharge claim fails.
Thus, diligence on the part of Plaintiff would have made clear that Plaintiff could not prevail on his claims against Camelback Toyota. Accordingly, the Court will award Camelback Toyota its reasonable attorneys' fees in defending against Plaintiff's claims. Camelback Toyota may file the appropriate claim pursuant to Rule 54.2 of the Rules of Practice of the United States District Court for the District of Arizona, effective December 1, 2005.
5. Conclusion on ABC Nissan and Camelback Toyota's Motions for Summary Judgment
After carefully reviewing all the evidence before it, it is quite clear to the Court that the facts in this case are in dispute. Taking those facts in the light most favorable to Plaintiff, genuine issues of material fact exist as to Plaintiff's claims regarding his first period of employment with ABC Nissan. Accordingly, the Court will deny ABC Nissan's Motion for Summary Judgment as to that period of employment. However, the Court concludes that even after taking the facts in the light most favorable to Plaintiff, Plaintiff has not demonstrated a hostile working environment or constructive discharge as a matter of law with regard to his employment with Camelback Toyota and his second period of employment with ABC Nissan. Consequently, the Court will grant ABC Nissan's Motion for Summary Judgment with respect to Plaintiff's second period of employment and grant Camelback Toyota's Motion for Summary Judgment and request for attorneys' fees. Plaintiff's hostile work environment and constructive discharge claims concerning his first period of employment remain. Finally, should a jury award Plaintiff backpay, Plaintiff's backpay award will be limited to backpay from the date of discharge until October 6, 2003, pursuant to the after-acquired evidence doctrine.
C. Discussion: AIG-AZ's Motion for Summary Judgment
Automotive Investment Group-Arizona, Inc. ("AIG-AZ") moves for summary judgment on the basis that it did not employ Plaintiff, directly or indirectly. Plaintiff, however, counters that AIG-AZ was his direct and indirect employer. Before turning to the facts in this case, the Court first sets forth the legal standards regarding whether an entity is a direct or indirect employer.
Plaintiff also asserted in his Amended Complaint that AIG-AZ, ABC Nissan, and Camelback Toyota are "corporate alter-egos and `joint' and/or `single' employers" of Plaintiff. [Doc. No. 49, ¶ 13.] However, Plaintiff has made no mention of those theories of liability since that time. Furthermore, Plaintiff did not respond to AIG-AZ's arguments about those theories in his Response to AIG-AZ's Motion. The Court's duty is not to make Plaintiff's arguments for him. Thus, the Court only addresses the two theories of liability in contention in the parties' briefs: direct and indirect employment.
Regarding direct employment, "the sine qua non of determining whether one is an employer is that an `employer can hire and fire employees, can assign tasks to employees and supervise their performance.'" EEOC v. Pac. Mar. Ass'n, 351 F.3d 1270, 1277 (9th Cir. 2003) (quoting Clackamas Gastroenterology Assocs. v. Wells, 538 U.S. 440, 450 (2003)).
To be considered an indirect employer, an entity must have "some peculiar control over the employee's relationship with the direct employer" and must also "engage in discriminatory interference." Anderson v. Pac. Mar. Ass'n, 336 F.3d 924, 932 (9th Cir. 2003). That is, the indirect employer must either cause the hostile work environment or have the power to stop the hostile work environment by being able to take corrective measures. See Id.
With these standards in mind, the Court now considers the record before it and determines whether AIG-AZ was Plaintiff's direct or indirect employer.
1. Whether AIG-AZ was Plaintiff's direct employer
First, Plaintiff contends that AIG-AZ was his direct employer. In support of this contention, however, Plaintiff cites no case law. Rather, Plaintiff asserts that "as a `condition of employment,' [Plaintiff] was required to execute AIG's Anti-Harassment Policy, AIG's Drug Testing Policy, AIG Credit History Release Form, and various other AIG Employee Benefits Forms." [Doc. No. 89 at 2.] Plaintiff also notes that the President of AIG, Larry VanTuyl, received a copy of an investigative report prepared in response to Plaintiff's call to the employee hotline about David Arnold. [Id.] Plaintiff further argues that VanTuyl did not discipline Mr. Arnold and actually hired Mr. Arnold at other dealerships. [Id. at 3.] In support of this assertion about VanTuyl, Plaintiff cites to pages 9 and 10 of his Statement of Facts in opposition to ABC Nissan's Motion for Summary Judgment [Id.], but no such supporting evidence exists on those pages. Regardless, it is undisputed that Mr. Arnold was terminated from ABC Nissan, the workplace where Plaintiff was located and the offensive conduct occurred.
Additionally, Plaintiff submits Arizona Corporation Commission filings that show AIG-AZ, ABC Nissan, and Camelback Toyota share the same domestic address in Phoenix and have the same president and secretary. (Ex. 2 to Pl.'s SOF in Opp. to AIG-AZ's Mot.) Finally, Plaintiff points to numerous policies and memoranda authored by AIG, Inc. concerning such topics as transfers between dealerships and anti-harassment policies. (Exs. 3-14 to Pl.'s SOF in Opp. to AIG-AZ's Mot.)
Throughout Plaintiff's Response to AIG-AZ's motion, Plaintiff repeatedly refers to "AIG" rather than AIG-AZ. This is a significant distinction, as the documents referenced by Plaintiff in support of each of his assertions mention "AIG, Inc." or "AIG." As shown by the Arizona Corporation Commission report submitted by Plaintiff himself, AIG, Inc. was the predecessor entity to ABC Nissan, Inc. (Ex. 2 to Pl.'s SOF in Opp. to AIG-AZ's Mot.) On March 11, 1999, AIG, Inc. changed its name to ABC Nissan, Inc. (Id.) AIG-AZ, on the other hand, is an auto dealership management consulting company that was incorporated on December 30, 1998. (Id., see Exs. B-1 and B-2 to AIG-AZ's Mot.) Indeed, on its Corporation Commission report, AIG-AZ's business type is listed as "contractor." (Ex. 2 to Pl.'s SOF in Opp. to AIG-AZ's Mot.) Thus, it is clear from the record that AIG, Inc. and AIG-AZ are not the same entity. Plaintiff, in repeatedly referring to AIG-AZ as "AIG" and referencing documents that use "AIG, Inc." and "AIG" interchangeably, seems to confuse the two entities. Furthermore, the Court notes that at least one of the documents referenced by Plaintiff, the Employee Handbook, was likely created before AIG-AZ was incorporated. (See Ex. 13 to Pl.'s SOF in Opp. to AIG-AZ's Mot. (handbook that references "AIG" and contains the footer "© 1998, AIG, Inc."); AIG-AZ was incorporated on December 30, 1998.)
ABC Nissan, Inc. is of course already a party to this action, and its Motion for Summary Judgment has been addressed supra.
AIG-AZ pointed out the distinction between the entities in some detail in its Reply. [Doc. No. 98] Plaintiff has not filed anything, i.e., a Motion for Leave to File a Sur-Reply or the like, to clarify his position regarding the difference between AIG, Inc. and AIG-AZ.
Plaintiff emphasizes the policies he was required to "execute," such as the anti-drug and anti-harassment policies. However, the forms refer to AIG, Inc., which ABC Nissan, Inc. replaced via a name change. (Ex. 2 to Pl.'s SOF in Opp. to AIG-AZ's Mot.) The forms were signed by Plaintiff in November 1999; the name change occurred in March 1999. Plaintiff also notes that he transferred from ABC Nissan to Camelback Toyota (as opposed to undergoing a re-hiring process), and ABC Nissan used forms with its former name on them some months after it underwent a name change. However, an issue of triable fact as to the legal status of AIG-AZ does not arise, because the evidence before the Court shows only that AIG-AZ is a consulting group to auto dealerships that contracted with ABC Nissan and Camelback Toyota to "assist" with, inter alia, "all subordinate personnel matters." (Exs. B-1 and B-2 to AIG-AZ's Mot.) Likewise, that the dealerships have the same office listed as AIG-AZ on the Corporation Commission filing and have the same president and secretary does not demonstrate that AIG-AZ does more than assist in some aspects of dealership management.
Moreover, to be considered a direct employer, an entity must have the power to hire and fire employees, to assign tasks to employees, and to supervise their performance. See EEOC v. Pac. Mar. Ass'n, 351 F.3d at 1277. Plaintiff has provided no evidence demonstrating that AIG-AZ, a consulting company, had any the power to do any of those activities. According to the contractual arrangements between AIG-AZ and ABC Nissan or Camelback Toyota, AIG-AZ will "assist" the dealerships in personnel matters. Plaintiff has further provided no case law or evidence supporting the contention that the contractual language provides AIG-AZ with the power to hire, fire, assign tasks to, or supervise the dealerships' employees. At the summary judgment stage, Plaintiff must come forward and "make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322. Because Plaintiff has failed to do so, the Court concludes that summary judgment is appropriate as to Plaintiff's direct employer theory of liability on the part of AIG-AZ.
2. Whether AIG-AZ is an indirect employer
As stated supra, an entity must have "some peculiar control over the employee's relationship with the direct employer" and must also "engage in discriminatory interference" to be an indirect employer. Anderson v. Pac. Mar. Ass'n, 336 F.3d 924, 932 (9th Cir. 2003). In other words, the indirect employer must either cause the hostile work environment or have the power to stop the hostile work environment by being able to take corrective measures. See Id. To fall under the latter category, an entity must have more than a "limited" amount of power. See Id. An entity that has the power "to conduct investigations and implement new work site rules to curb harassment" may have more than a limited amount of power. See Id. at 931-32.
Here, Plaintiff argues that AIG-AZ is an indirect employer because of its contractual agreement with the dealerships and because "AIG required both ABC Nissan and Camelback Toyota employees to execute AIG's Drug Free Workplace Policy, AIG's Credit History Release Consent Form, and AIG's various Employee Benefit Forms, and, most important, AIG's Anti-Harassment Policy." [Doc. No. 89 at 4.] Also, Plaintiff notes that the Employee Handbook "expressly provides that the `President of AIG' has the authority to change the terms of the Employee Handbook." [Id.]
The Court, however, disagrees with Plaintiff's assertions. As noted supra, the contracts between AIG-AZ and ABC Nissan and Camelback Toyota merely state that AIG-AZ shall "assist" the dealerships in personnel matters. Furthermore, the proffered evidence does not demonstrate that AIG-AZ "required" dealership employees to execute any forms or policies. Rather, the documents referenced by Plaintiff mention AIG, Inc., which, as also discussed supra, is a completely different entity than AIG-AZ. Last, the Handbook, as the Court has previously pointed out, was created by AIG, Inc., not AIG-AZ (and, for that matter, was likely created before AIG-AZ was incorporated). AIG-AZ therefore did not have the power Plaintiff claims it did through the Handbook.
The evidence before the Court does not show that AIG-AZ, a dealership management consulting company, either caused the hostile work environment Plaintiff alleges or had the power to stop that hostile work environment by implementing corrective measures. Plaintiff has not shown that AIG-AZ conducted investigations for the dealerships. To the contrary, Plaintiff submits an investigation report conducted by AutoHR, Inc., not AIG-AZ, in response to Plaintiff's complaint about David Arnold's use of a racial slur. (Ex. 15 to Pl.'s SOF in Opp. to AIG-AZ's Mot.) Also, Plaintiff has proffered no evidence that shows AIG-AZ has the power to implement new work site rules in response to a hostile work environment. Instead, Plaintiff relies on forms that list an entity different from AIG-AZ. The Court concludes that Plaintiff has not demonstrated that AIG-AZ is an indirect employer under applicable Ninth Circuit law. Accordingly, the Court will grant summary judgment as to this theory of liability. See Celotex, 477 U.S. at 322.
The Court refers to the report without ruling on its admissibility in this case.
C. Conclusion as to AIG-AZ's Motion for Summary Judgment
Plaintiff has not shown that AIG-AZ, an auto dealership management consulting company, either hired, fired, supervised, or assigned tasks to dealership employees. Thus, Plaintiff's direct employer theory of liability fails as a matter of law. In addition, Plaintiff has failed to demonstrate that AIG-AZ either caused the hostile work environment he alleges or had the power to stop that hostile work environment. Plaintiff's indirect employer theory of liability consequently must also fail as a matter of law.
Because Plaintiff has failed to show that AIG-AZ was his employer, either directly or indirectly, the Court will grant AIG-AZ's Motion for Summary Judgment.
III. CONCLUSION
Accordingly, for the reasons set forth above,
IT IS ORDERED that Defendant ABC Nissan, Inc.'s Motion for Summary Judgment [Doc. No. 79] is GRANTED IN PART and DENIED IN PART. Plaintiff's hostile work environment and constructive discharge claims as to his first period of employment with ABC Nissan remain, and Plaintiff's hostile work environment and constructive discharge claims as to his second period of employment with ABC Nissan are dismissed.
IT IS FURTHER ORDERED that Defendant CTVT Motors, Inc. (aka Camelback Toyota, Inc.)'s Motion for Summary Judgment [Doc. No. 75] is GRANTED. CTVT Motors, Inc. (aka Camelback Toyota, Inc.) shall no longer be a party to this matter. CTVT Motors, Inc. (aka Camelback Toyota, Inc.) may file a claim for reasonable attorneys' fees in accordance with LR Civ. 54.2.
IT IS FURTHER ORDERED that Defendant Automotive Investment Group-Arizona, Inc.'s Motion for Summary Judgment [Doc. No. 77] is GRANTED. Automotive Investment Group-Arizona, Inc. shall no longer be a party to this action.