United States District Court, S.D. Texas, Houston Division
MEMORANDUM OPINION & ORDER
H. Miller United States District Judge
before the court are motions for summary judgment and
objections to summary judgment evidence, which include: (1)
defendant Plus4 Credit Union's (“Plus4”)
motion for summary judgment against plaintiff Emma Donald
(Dkt. 16); (2) Plus4's motion for summary judgment
against plaintiff Christopher Lee (Dkt. 17); (3)
plaintiffs' objections and motion to strike Plus4's
summary judgment evidence (Dkt. 22); and (4) Plus4's
objections to the plaintiffs' summary judgment evidence
considered the motions, responses, replies, objections,
evidentiary record, and applicable law, the court is of the
opinion that (1) Plus4's motion for summary judgment
against Emma Donald (Dkt. 16) should be GRANTED IN PART AND
DENIED IN PART; and (2) Plus4's motion for summary
judgment against Christopher Lee (Dkt. 17) should be GRANTED
IN PART AND DENIED IN PART.
(3) the plaintiffs' objections should be SUSTAINED IN
PART AND OVERRULED IN PART and their motion to strike (Dkt.
22) should be GRANTED IN PART AND DENIED IN PART; and (4)
Plus4's objections to the plaintiffs' summary
judgment evidence (Dkt. 26) should be SUSTAINED IN PART AND
OVERRULED IN PART.
an employment discrimination case. Emma Donald and
Christopher Lee (collectively, the “Plaintiffs”)
brought suit against their former employer, Plus4, for
terminating their positions because of discriminatory and
retaliatory reasons. Dkt. 9. Donald, an African American
female, served as Plus4's Human Resources Manager from
November 12, 2013, until her termination on March 27, 2015.
Id. In July 2014, Donald alleges that Plus4's
Chief Operating Officer Patricia Fendley instructed her to
hire only white employees for a new branch office located in
Humble, Texas. Dkts. 9, 21. Fendley stated, “Hire all
White but maybe have one (1) Black person as a teller in the
back so they wouldn't be seen . . . We have to have the
right look.” Dkts. 9, 21-2, Ex. A at ¶ 3 (Donald
Aff.). Donald verbally disagreed with Fendley's order.
Christopher Lee's Hiring
August 2014, Donald hired an African American female for
another branch location and co-plaintiff Lee, an African
American male as a temporary bank teller for the Humble
location. Dkt. 9. Lee was referred to Plus4 from PrideStaff,
a temporary staffing agency. Dkt. 17. During his interview,
Lee had his hair styled in dreadlocks. Dkt. 17, Ex. B. at 48
(Lee Dep.). Lee interviewed with Donald, Sales Manager
Sharoye Taylor, and Humble Branch Manager Dana Mack.
Id. at 47. On August 8, 2014, Donald, Mack, Fendley,
and Plus4 Chief Executive Officer Vladimir Stark agreed to
hire Lee and they all signed his approval form for him to
begin a 90-day trial period. Dkt. 17 at 6; Ex. D (Lee's
approval to hire form).
August 18, 2014, Lee's first day of employment, Donald
alleges that Fendley instructed her to fire Lee because he
was black and had dreadlocks. Dkts. 9, 21-2, Ex. A
¶¶ 4, 5. Fendley told Donald not to tell PrideStaff
the real reason behind Lee's termination. Id.
Fendley also said that she would start sitting in on all of
Donald's interviews so that “we can hire the right
people for Humble.” Id. Donald verbally
disagreed with Fendley and said that Lee cannot be fired for
those reasons. Id. Donald later sent her concerns to
Fendley via e-mail. Id. According to Donald, Fendley
began to closely monitor Lee through the company's video
system on a daily basis, which she did not do to other
employees to the same extent or frequency. Dkts. 9, 21-2, Ex.
A ¶ 8. On several other occasions, Fendley ordered
Donald to terminate Lee's employment, and each time
Donald refused. Id. at ¶ 9.
recommended that Donald meet with one of Plus4's lawyers
from the law firm Kennard Blankenship Robinson, P.C.
Id. In August 2014, Donald told the lawyer about
Fendley's instruction to hire only whites for the Humble
location and to fire Lee because he was black and had
dreadlocks. Id. Donald claims that the lawyer said
he would conduct leadership and diversity classes with Plus4
management, but no such classes were conducted. Id.
refusing to terminate Lee, Donald argues that on October 31,
2015, she received a less favorable performance review and
was told to be compliant when the executive team asked her to
do something. Dkt. 16-5, Ex. A at 116 (Donald Dep.). Donald
alleges that up until that point, the only time that she
refused to comply with executive orders was when she was
asked to “fire Christopher Lee and discriminate against
him for having dreads” and “not to hire any
blacks at the Humble location.” Id. Donald
alleges that this written review was not given to her until
February 10, 2015, about a month and a half before she was
terminated. Dkt. 9.
Christopher Lee's Termination
November 14, 2014, Lee was terminated from his temporary
branch teller position. Dkt. 17. The parties dispute the
reasons for Lee's termination. During Lee's trial
period, Plus4 alleges that his manager complained about his
performance because he was taking personal calls while he was
at work, he did not permit a new employee to train with him,
and he disturbed other co-workers with his loud singing. Dkt.
17. On November 12, 2014, Humble Branch Manager Dana Mack
e-mailed Donald regarding Lee's performance issues. Dkt.
17, Ex. N. That same day, Donald forwarded the e-mail to
Fendley and asked for Fendley's permission “to let
Friday be Christopher [Lee's] last day, ” stating
that these were “performance issues.” Dkt. 17,
Ex. O. Donald, on the other hand, argues that after refusing
to terminate Lee on several occasions, she “no longer
could win against Ms. Fendley” and agreed to Lee's
termination. Dkt. 21-2, Ex. A ¶ 11. Donald stated that
she needed her job and “wanted all of this to
end.” Id. “I knew that Ms. Fendley was
going to get her way, with or without my support.”
argues that four months after Lee was terminated, Donald
contacted Lee and told him that he had been fired because of
discrimination against his race, color, and religion. Dkt.
17. Plus4 argues that Lee's discrimination claims fail
because he cannot show that the reason why he was terminated
was because of his race, color, or religion and not because
of his performance at work. Id. Lee counters that
there is direct evidence that his termination was due to
discrimination against his color, race, and/or religion based
on Fendley's statements and actions. Dkt. 21.
Emma Donald's Termination
November 2014 until Donald's termination in March 2015,
Donald alleges that she: (1) “continued to oppose other
discriminatory practices and [believed she] was being
retaliated against by Ms. Fendley, ” and (2) met with
Plus4 lawyers on a second occasion to discuss her concerns
that Fendley was retaliating against her and LaDonna Wells,
an African American female who Fendley wanted fired. Dkt.
21-2, Ex. A (Donald Aff.).
March 27, 2015, Donald was terminated from her position as
Human Resources Manager. Dkts. 9, 16. The parties dispute the
reason for her termination. Plus4 argues that it eliminated
Donald's position due to a reduction in force. Dkt. 16.
In the first quarter of 2015, Plus4 claims that it began to
face financial issues. Id. Donald attended a
managers meeting where they made several recommendations to
reduce costs, including a general recommendation to reduce
staffing costs by $50, 000. Id. According to Plus4,
Stark conferred with Fendley about the managers'
recommendations, and then individually came to the conclusion
to eliminate the Human Resources Department. Id.
This included Donald's Human Resources Manager position
and a Human Resources Assistant position held by Amy Baker, a
white female. Id. Stark prepared a memo analyzing
the reduction in force of the Human Resources Department and
claimed that an Executive Assistant would absorb any duties
not handled by a third-party human resources company.
Id.; Dkt. 23-2 at 39 (memo analyzing reduction in
Donald does not dispute that the company was facing financial
difficulties, she argues there is scant evidence of a
reduction in force. For example, as the Human Resources
Manager in February 2014, Donald received an e-mail from
Fendley advising that the company was under a hiring freeze,
but during that same month, Plus4 hired Celeste Douglas for a
manager position without an open office or written job
description. Dkt. 21-2, Ex. A ¶ 15; see also
Dkt. 21-4, Ex. C at 44 (Stark Dep.) (hiring freeze). Donald
argues that the real reasons why she was terminated were
because Plus4 discriminated against her race, color, and/or
sex, and retaliated against her for (1) disregarding
Fendley's instruction to hire whites only, (2) repeatedly
refusing to terminate Lee when Fendley ordered her to do so,
and (3) for meeting with Plus4 lawyers to discuss her
concerns on two occasions, including a March 2015 meeting
held about two weeks before her termination. Dkt. 21.
18, 2015, and on June 4, 2015, Donald and Lee each filed a
separate charge of discrimination against Plus4 with the
Equal Employment Opportunity Commission (“EEOC”).
Dkt. 9. On October 21, 2015, the EEOC issued Notices of Right
to Sue, entitling the Plaintiffs to file an action under
Title VII. Id. On January 15, 2016, the Plaintiffs
filed a complaint against Plus4 with discrimination and
retaliation claims. Dkt. 1. On January 20, 2017, Plus4 moved
for summary judgment against all of Emma Donald's
discrimination and retaliation claims (Dkt. 16) and against
all of Christopher Lee's discrimination claims (Dkt. 17).
The Plaintiffs filed a combined response to the motions and
Plus4 replied to each motion. Dkts. 21 (response), 23 (reply
to Donald), 24 (reply to Lee). The Plaintiffs also filed
objections and a motion to strike Plus4's summary
judgment evidence. Dkt. 22. Plus4 also filed objections to
the Plaintiffs' summary judgment evidence. Dkt. 26. The
parties responded to each other's objections. Dkts. 25,
shall grant summary judgment when a “movant shows that
there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.”
Fed.R.Civ.P. 56(c). “[A] fact is genuinely in dispute
only if a reasonable jury could return a verdict for the
non-moving party.” Fordoche, Inc. v. Texaco,
Inc., 463 F.3d 388, 392 (5th Cir. 2006) (citing
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248,
106 S.Ct. 2505 (1986)). The moving party bears the initial
burden of demonstrating the absence of a genuine issue of
material fact. Celotex Corp. v. Catrett, 477 U.S.
317, 323, 106 S.Ct. 2548 (1986). If the party meets its
burden, the burden shifts to the non-moving party to set
forth specific facts showing a genuine issue for trial.
nonmovant must “go beyond the pleadings and by [his]
own affidavits, or by depositions, answers to interrogatories
and admissions on file, designate specific facts showing that
there is a genuine issue of material fact for trial.”
Giles v. General Elec. Co., 245 F.3d 474, 493 (5th
Cir. 2001), citing Celotex, 477 U.S. at 324. The
court must view the evidence in the light most favorable to
the non-movant and draw all justifiable inferences in favor
of the non-movant. Envtl. Conservation Org. v. City of
Dall., Tex., 529 F.3d 519, 524 (5th Cir. 2008).
and Lee's discrimination and retaliation claims arise
under Title VII of the Civil Rights Act of 1964. Dkt. 9.
Title VII prohibits an employer from discriminating against
its employees on the basis of “race, color, religion,
sex, or national origin, ” or retaliating against an
employee for filing a complaint or opposing a discriminatory
practice. 42 U.S.C. §§ 2000e-2-3; Boyd v. State
Farm Ins. Co., 158 F.3d 326, 328 (5th Cir. 1998) (citing
42 U.S.C. § 2000-2(a)); see Autry v. Fort Bend
Indep. Sch. Dist., 704 F.3d 344, 346-47 (5th Cir. 2013)
(race); Long v. Eastfield Coll., 88 F.3d 300, 304
(5th Cir. 1996) (retaliation). The court will first address
each party's objections to the summary judgment evidence
and then analyze each cause of action.
Plaintiffs' Objections and Motion to Strike (Dkt.
the Plaintiffs move to strike any reference to Plus4's
third-party human resources company, CU People, Inc.
(“CU People”) from Plus4's motion for summary
judgment on Donald's claims. Dkt. 22. The Plaintiffs
argue that the statements made by CU People constitute
hearsay and that Plus4 has not shown that it falls within a
hearsay exception. Fed.R.Evid. 803; Dkt. 22 at 2. Second, the
Plaintiffs move to strike three sentences in Vladimir
Stark's affidavit referencing CU People. Id.
(citing Dkt. 16-5 at 31 ¶ 9). Third, the Plaintiffs move
to strike three exhibits that are attached to Plus4's
motion for summary judgment on Lee's claims. Dkt. 22
(citing Dkt. 17, Exs. J, K, L). The court will address each
objection in turn.
the Plaintiffs object to any reference to CU People in
Plus4's motion for summary judgment on Donald's
claims. Dkt. 22 (citing Dkt. 16). The Plaintiffs make a
general hearsay objection to CU People and do not cite to
specific sections. Dkt. 22. Plus4 responded to the motion to
strike by including excerpts from its motion for the
court's convenience. See e.g., Dkt. 25 at 2
(“Mr. Stark considered the cost savings that would
result from the elimination of Donald's and Ms.
Baker's salaries, and the fact that Plus4 already had a
contract with CU People, Inc., a third-party HR consulting
company”). Plus4 argues that these statements are not
hearsay because they are based on Stark's personal
knowledge of an existing contract that he signed with a
third-party human resources company, and formed the basis for
his business decision. Dkt. 25 at 2-3. The court agrees with
Plus4 and finds that the excerpted passages pertain to
Stark's opinion on the financial situation of the
company, which he had personal knowledge of as the
company's CEO. Fed.R.Evid. 602, 803(3). The
Plaintiffs' objections to references to CU People are
the Plaintiffs move to strike portions of the Stark
affidavit. Dkt. 22 (citing Dkt. 16-5, Ex. B). The Plaintiffs
object to the following as hearsay:
I was aware that Plus4 had an existing contract with CU
People, Inc., a third-party HR consulting company, that
provided for many of the same services performed by
Plus4's two internal HR employees. Previously, a
representative of CU People had informed me that there were
services within our existing contract that Plus4 was paying
for but was not fully utilizing. In light of the ongoing
budgetary concerns . . . and the fact that Plus4 was already
utilizing and paying a third-party HR vendor, I concluded
that elimination of Plus4's internal HR department . . .
would be a helpful measure to reduce Plus4's expenses.
Dkt. 16-5, Ex. B at 31 ¶ 9.
court finds that at least some of Stark's statements do
not constitute hearsay because they are not offered for the
truth of the matter asserted. As the CEO, Stark signed a
contract with CU People, and therefore had personal knowledge
of the contents of the contract and that CU People was a
third-party human resources company. Fed.R.Evid. 602, 803(3).
The statement “Previously, a representative of CU
People had informed me that there were services within our
existing contract that Plus4 was paying for but was not fully
utilizing” would constitute hearsay if it were offered
for the truth of the matter asserted. Dkt. 25 at 4-5.
Plus4 argues that it falls into the state of mind exception
to hearsay. Id.; Fed.R.Evid. 801, 803(3). Plus4
argues that Stark's declaration “simply offers
testimony as to how he initially learned of underutilized
services offered by CU People” and was what “Mr.
Stark took into consideration when making his ultimate
decision to eliminate Plus4's HR department.” Dkt.
25 at 5. The court finds that CU People's representations
were used as part of the basis for Stark's decision,
therefore it falls under the state of mind exception.
Fed.R.Evid. 803(3). Accordingly, the Plaintiffs'
objections to the three sentences in Stark's affidavit
are OVERRULED. The Plaintiffs' motion to strike these
three sentences is DENIED.
the Plaintiffs move to strike evidence in Plus4's motion
for summary judgment on Lee's claims. Dkt. 22 at 3. Plus4
presents three memoranda from Lee's supervisors Dana
Mack, Kerri Zinn, and Sharoye Taylor, describing Christopher
Lee's poor work performance in 2014. Dkt. 17-4, Exs. J,
K, L. Plus4 argues that the memoranda are admissible as
business records under Rule 803(6)(A) because “it was
the regular course of business of Plus4 for an employee or
representative of Plus4, with knowledge of the acts or events
that were recorded, to make these records or to transmit the
information to be included in these records.” Dkt. 25
at 6 (citing Dkt. 17-2 at 6). Rule 803(6)(A) states that a
record of an act, event, condition, opinion, or diagnosis is
excluded as hearsay if “the record was made at or near
the time by-or from information transmitted by-someone with
knowledge.” Fed.R.Evid. 803(6)(a).
Plaintiffs counter that these memos were not made in the
ordinary course of business, and were not made
contemporaneous to the alleged act or event. Dkt. 22. The
memos were either undated or dated in July 2015, several
months after Lee was terminated. Dkt. 17-4, Exs. J-L. On
November 18, 2014, while Donald was still the Human Resources
Manager, Lee was terminated from his position. Dkt. 22.
Donald testified that no such memos were prepared or
contained in Lee's employee file when he was terminated.