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Soto v. Costco Wholesale Corp.

Court of Appeals of Missouri, Western District, Fourth Division

October 18, 2016


         Appeal from the Circuit Court of Jackson County, Missouri The Honorable Robert M. Schieber, Judge

          Before: Mark D. Pfeiffer, Chief Judge, and James Edward Welsh and Alok Ahuja, Judges

          Mark D. Pfeiffer, Chief Judge

         Costco Wholesale Corporation ("Costco") appeals from the judgment of the Circuit Court of Jackson County, Missouri, entered following a jury verdict in favor of Mr. Primitivo Soto ("Soto") on his retaliation claim under the Missouri Human Rights Act ("MHRA"). We affirm the trial court's judgment as modified. We also grant Soto's motion for attorney's fees, which was taken with the case.

         Factual and Procedural Background[1]

         Soto was hired by Costco on October 22, 1990. In 2006, Soto was promoted to assistant general manager of Costco's midtown Kansas City, Missouri, warehouse under warehouse manager Mr. Brett Mittone ("Mittone"). In 2008, Soto was transferred to Costco's Independence, Missouri, warehouse where he worked as assistant general manager, again under Mittone. Mittone's performance reviews of Soto while working as an assistant warehouse manager were favorable. In 2010, Soto noticed that Hispanic supervisors at the Independence warehouse under Mittone "weren't really getting support or guidance on how to do their jobs" and that "there was some definite higher expectations than normal." Soto saw that the Independence warehouse organizational chart contained very few Hispanics, and he noticed that Latino workers were "not supported, they weren't given the opportunity to get their jobs done, they weren't given the tools necessary for them to be successful."

         On June 13, 2011, Soto was transferred to Costco's midtown Kansas City, Missouri, warehouse. In late July or early August 2011, Soto had a conversation with Mr. Clin Warren ("Warren"), the midtown warehouse general manager, about Soto's concerns that Latino employees at the Independence warehouse were treated unfairly, were passed over for promotions, and were discriminated against. Warren suggested that Soto contact Mr. Dan McMurray ("McMurray"), the regional operations manager in Chicago. Warren told Soto he would also contact McMurray because Soto's allegations were "pretty heavy, " and Warren would have to "take them up the chain."

         After Soto's conversation with Warren about what Soto perceived as discrimination by Mittone, there was a noticeable change in Soto's relationship with Warren. According to Soto, "I couldn't do anything right. And [Warren] was nitpicking pretty much everything I did . . . ."

         By September 2011, Soto had not been contacted about his report to Warren, so he sent an email to Mr. John Gaherty, a Costco regional manager in Chicago, asking to talk about his concerns. Soto received a call from McMurray, who agreed to meet with Soto the next time he was in Kansas City. A couple of weeks later, Soto met with McMurray and requested that he investigate discrimination against Latinos at the Independence warehouse, specifically mentioning instances that he was personally aware of in which he believed Hispanic managers were being unfairly forced out of the company. McMurray "investigated" Soto's allegations by conversing with Mittone and, shortly thereafter, advised Soto that he had found no evidence of wrongdoing.

         On Saturday, November 12, 2011, the midtown Costco warehouse had a "rapid receive" delivery from the Costco depot. Products in "rapid receive" or "blind receive" deliveries are unloaded and stocked, and receipt is not verified when the product comes off the truck. If receiving errors are discovered, adjustments are made by the store auditor and approved by the warehouse manager. On Monday, November 14, 2011, when the items received on November 12 were matched with the product tags, it was discovered that a seafood pallet was missing from the November 12 delivery. The receiving manager emailed the Costco depot and the other managers regarding the discrepancy.

         On Monday, November 21, 2011, Mr. Larry Thompson ("Thompson"), the midtown Costco meat department manager, was inventorying the meat department. He asked Soto in passing, "Hey, what are we going to do with that fish? You know, are you going to count the stuff for now, wait and see if we can find it, what are we going to do?" Soto told him to tentatively count the pallet ($3, 000 in seafood inventory) for right now. Thompson obtained a list of the missing seafood items and provisionally entered them into the inventory so they could easily be removed later if necessary.

         That same day, Soto made contact with both Warren and the regional meat manager, Mr. Steve Tarantino ("Tarantino"), about the missing seafood pallet from the November 12th"rapid receive" delivery and sought their advice. In other words, Soto did not hide the inventory matter from his superiors; instead, he sought them out for advice on how to handle the situation. Both instructed Soto that the missing inventory should not be added to the store's inventory. Thereafter, and within one day of Soto's initial instruction to Thompson to tentatively include the missing seafood pallet in inventory, it was removed from the inventory. However, prior to this inventory adjustment, Thompson emailed Tarantino to notify him that the missing seafood pallet had been added to the meat department inventory at Soto's direction (prior to Soto inquiring with his superiors about how they wished for him to handle the missing inventory situation), even though it had not been received.

         After Warren was informed that the missing seafood pallet had been counted in his store's inventory, Warren contacted McMurray to inform him that Soto had instructed Thompson to count the missing seafood pallet items in inventory. McMurray directed Warren to conduct an investigation. On November 25, 2011, Warren and Mr. Bruce Miles, general manager of Costco's Lenexa warehouse, interviewed Soto. On that date, Soto was issued an Employee Counseling Notice, which stated that Soto was suspended for two weeks, one week without pay, due to his violation of Costco's Manager's Standards of Ethics regarding falsification of company records, specifically, inventory forms. Thereafter, on December 13, 2011, Soto was demoted to a front-end manager position, which resulted in a significant decrease in compensation.

         Soto lost approximately $85, 000 in income as a result of the demotion. He also received a lower 401(k) match, and he no longer qualified for stock options or for a bonus based on company performance. Soto was impacted emotionally by the allegations that he was dishonest and unethical (especially where he had explained the inventory situation to his superiors and sought their advice on the same day he was notified of the seafood pallet issue) and by his resulting suspension and demotion.

         In February 2012, Soto was transferred to Costco's Lenexa, Kansas, warehouse. Also in 2012, Soto filed a charge of discrimination with the Equal Employment Opportunity Commission and the Missouri Commission on Human Rights. On May 6, 2013, Soto filed a petition for damages in the Circuit Court of Jackson County, Missouri, alleging that Costco and Warren violated the MHRA when he was suspended and demoted to a position that paid less compensation in retaliation for his report of discrimination against Latino employees at Costco's Independence, Missouri, warehouse.

         After a six-day trial, on February 4, 2015, the jury found in favor of Soto and against Costco and awarded Soto $250, 000 in damages. On February 23, 2015, Soto's attorney filed a motion for attorney's fees, costs, pre-judgment and post-judgment interest. The trial court entered its judgment on March 18, 2015, for Soto on the jury's verdict and awarded him $234, 890 in attorney's fees; $10, 077.14 in costs; $11, 250 in pre-judgment interest; and post-judgment interest of 5% on the verdict and pre-judgment interest award, and 9% on the attorney's fees and costs awarded in the judgment.

         Costco filed a motion for a new trial or, in the alternative, for remittitur, and a motion for judgment notwithstanding the verdict ("JNOV") on April 17, 2015. The trial court entered its order denying Costco's post-trial motions on May 27, 2015.

         Costco timely appealed.

         Deficient Jurisdictional Statement

         Before addressing Costco's points on appeal, we must address the issue raised by Soto that Costco's jurisdictional statement is defective and violates Rule 84.04. Rule 84.04(a) requires that the appellant's brief contain a concise statement of the grounds on which jurisdiction of the appellate court is invoked. Rule 84.04(b) provides:

Jurisdictional Statement. Bare recitals that jurisdiction is invoked 'on the ground that the construction of the Constitution of the United States or of this state is involved' or similar statements or conclusions are insufficient as jurisdictional statements. The jurisdictional statement shall set forth sufficient factual data to demonstrate the applicability of the particular provision or provisions of Article V, section 3, of the Constitution whereon jurisdiction is sought to be predicated.

         Costco's jurisdictional statement reads:

Costco Wholesale Group ("Costco") appeals from the Circuit Court of Jackson County, Missouri's May 27, 2015 Final Judgment and Order on Defendant's Motion for Judgment Notwithstanding the Verdict and Defendant's Motion for New Trial or, in the Alternative, Remittitur, and the Order on Soto's Motion for Attorney's Fees. Jurisdiction lies in the Western District under Mo. Rev. Stat. § 477.070.

         Costco's jurisdictional statement does not comply with Rule 84.04(b) because: (1) it does not clearly identify what final, appealable judgment of the Circuit Court of Jackson County, Missouri, is being appealed; and (2) it is a "bare recital" of our jurisdiction being invoked under section 477.070; it does not set forth "sufficient factual data" to demonstrate that this case is within the provision of article V, section 3 of the Missouri Constitution assigning general appellate jurisdiction to the court of appeals rather than within the provision assigning exclusive jurisdiction to the supreme court.

         Although Costco's violation of Rule 84.04 is a sufficient basis upon which to dismiss its appeal, we choose to exercise our discretion not to do so "because we are able to determine our jurisdiction from [Costco's] brief and the record and because it is our preference to dispose of cases on the merits rather than to dismiss them for deficiencies in the briefs." Robin Farms, Inc. v. Bartholome, 989 S.W.2d 238, 245 (Mo. App. W.D. 1999). Accordingly, we will review the merits of Costco's appeal, ex gratia. However, we caution Costco's counsel that henceforth counsel should make every effort to comply with Rule 84.04. Id. at 245; Buttress v. Taylor, 62 S.W.3d 672, 677 (Mo. App. W.D. 2001).

         Standard of Review

         Costco raises seven points on appeal, six of which challenge the trial court's denial of Costco's post-trial motions, and one of which challenges the trial court's award of attorney's fees and costs. The appropriate standard of review will be included under the analysis of each point.


         Point I

         In Costco's first point, it asserts that the trial court erred in denying its motion for JNOV because Soto failed to present sufficient evidence to support his retaliation claim under the MHRA.

         The standard for reviewing the trial court's denial of a motion for JNOV is essentially the same as for reviewing the denial of a motion for directed verdict. Peel v. Credit Acceptance Corp., 408 S.W.3d 191, 204 (Mo. App. W.D. 2013). "A case may not be submitted unless legal and substantial evidence supports each fact essential to liability." Id. (internal quotation omitted). Because a trial court's grant of a motion for JNOV is a drastic action, it should be done only when reasonable persons could not differ on the correct disposition of the case. Id. Whether the plaintiff made a submissible case is a question of law, which we review de novo. Id.

         Under the MHRA, it is an unlawful discriminatory practice to retaliate "in any manner" against an employee who "has opposed any practice prohibited by this chapter" or "has filed a complaint . . . pursuant to this chapter." § 213.070(2). To make a submissible case on Soto's retaliation claim under the MHRA, he was required to establish that: (1) he complained of discrimination; (2) Costco took adverse action against him; and (3) a causal relationship existed between the complaint and the adverse action. Minze v. Mo. Dep't of Pub. Safety, 437 S.W.3d 271, 275 (Mo. App. W.D. 2014). Soto must satisfy the causation standard by demonstrating that his complaint of discrimination was a "contributing factor" to Costco's adverse employment action. Templemire v. W & M Welding, Inc., 433 S.W.3d 371, 383 (Mo. banc 2014). "A contributing factor is a condition that contributes a share in anything or has a part in producing the effect." Turner v. Kansas City Pub. Sch., 488 S.W.3d 719, 723 (Mo. App. W.D. 2016) (internal quotation omitted). If Soto's protected activity was even one contributing factor in Costco's decision to act in reprisal against him, then there was an unlawful retaliation. See Walsh v. City of Kansas City, 481 S.W.3d 97, 106 (Mo. App. W.D. 2016).

         "A retaliation claim is not conditioned on the success of the underlying discrimination or harassment claim." Minze, 437 S.W.3d at 275-76. "Thus, it is irrelevant to a claim of retaliation that the act complained of was not legally actionable. The only issue is whether the person making the complaint had a reasonable good faith belief that there were grounds for the claim of discrimination or harassment." Id. at 276.

         "Cases involving claims of retaliatory motive are inherently fact-based and often depend on inferences rather than on direct evidence." Turner, 488 S.W.3d at 723 (internal quotation omitted). Thus, Soto can rely on circumstantial evidence that tends to support an inference of retaliatory motive. Id. To withstand a motion for JNOV, Soto was required to "make a submissible case by offering substantial evidence to support every fact essential to a finding of liability." Turner, 488 S.W.3d at 722 (internal quotation omitted). "We view the evidence in the light most favorable to the verdict, disregarding evidence to the contrary." Id. "We will reverse the jury's verdict only where we find a complete absence of probative facts to support the jury's conclusion." Id. (internal quotation omitted).

         Soto offered substantial evidence to make a submissible case on his retaliation claim under the MHRA. He established that:

• He twice reported his belief that Latino workers at Costco's Independence warehouse were being discriminated against. Soto testified that he was transferred to Costco's midtown Kansas City, Missouri, warehouse on June 13, 2011, and in late July or early August 2011, he had a conversation with Warren about his concerns that Latino employees at the Independence warehouse were treated unfairly, were passed over for promotions, and were discriminated against. Subsequently, in September or October of 2011, Soto met with McMurray and advised him of discrimination at the Independence warehouse. Warren and McMurray both admitted that Soto talked to them about his concerns regarding discrimination at the Independence warehouse.
• Costco took adverse action against Soto. On November 25, 2011, Costco advised Soto that he was suspended for two weeks-one of those weeks was without pay. Thereafter, on December 13, 2011, Soto was demoted to a front-end manager, ...

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