Reeves v. Safeway Stores, Inc.

Facts

The Fair Employment and Housing Act (FEHA) “prohibits an employer from firing a worker in retaliation for the worker’s complaining about incidents of sexual harassment in the workplace.” (Reeves v. Safeway Stores, Inc. (2004) 121 Cal.App.4th 95, 99, citing Gov. Code, § 12940, subds. (h), (j).) “An employer can defeat such a claim by showing that it acted not in response to the worker’s complaints but for legitimate, nonretaliatory reasons.” (Ibid.) FEHA, in short, “prohibits adverse treatment ‘because of’ protected activities.” (Id. at p. 107, quoting Gov. Code, § 12940, subd. (h).) The protected activity here was the plaintiff’s opposition to the harassment of others — not his own mistreatment — which the court treated as squarely within the statute’s protection. (Id. at p. 121.)

Plaintiff William McLeod Reeves worked for Safeway Stores, Inc., as a food clerk from May 1969 until his discharge in July 1998 — nearly a 29-year tenure. (Reeves, supra, 121 Cal.App.4th at pp. 100, 117.) In or before late 1997, he became aware of conduct he believed constituted sexual harassment of female employees in his store, the main offenders being Brian Sparks and the night manager, Steve Prodes. (Id. at p. 100.) “At least two female workers complained to plaintiff about the problem, and at least one of them asked him to speak to store management about it.” (Ibid.) Beginning in December 1997, Reeves complained several times to store manager Fred Demarest, who “seemed resentful and sought to ‘trivialize’ the complaints,” at one point telling Reeves, “Bill, as far as I’m concerned, unless these gals come to me and complain about it … , the problem exists between your ears.” (Ibid.)

The record contained corroboration of both the harassment and management’s resentment. Stephanie Alves testified that she complained directly to Demarest, “with no apparent result,” about harassment by Sparks and Prodes, and that store manager Henry Sukovaty sarcastically referred to Reeves as “Mr. Sexual Harassment.” (Reeves, supra, 121 Cal.App.4th at p. 100.) After the discharge, Sukovaty was heard to remark that “the reason why [plaintiff is] not here after 28 years is because all the women would go up to him and talk to him about sexual harassment.” (Id. at p. 100, fn. 2.) Within a year of Reeves’s dismissal, “Prodes was discharged for sexual harassment.” (Id. at p. 100.) District manager Moira Susan Hollis testified that a store manager receiving such a complaint “is supposed to … give that complaint to [the human resources department]” for investigation, and that Demarest “behaved inappropriately” if, as he and Reeves testified, he conducted his own investigation instead. (Ibid.)

The triggering incident was mundane. At midnight on May 31, 1998, Reeves ended his last shift before a short vacation, left the store, then returned “almost immediately in response to an urgent need to use the rest room.” (Reeves, supra, 121 Cal.App.4th at p. 101.) Sandy Juarez, “apparently in charge of the night crew,” refused to admit him, citing instructions not to let anyone in after closing. (Ibid.) Juarez testified that Reeves became “agitated and irate,” swore, and “shoved [her] through the door,” and Sparks testified that he saw the door hit Juarez; Reeves, however, “denies that he touched Juarez at all.” (Id. at pp. 101–102.) The court noted “some basis to question Sparks’s testimony” because Juarez did not recall Sparks being present. (Id. at p. 102, fn. 4.) Juarez called the police, who took no report and did not appear to take the matter seriously. (Ibid.)

When Demarest returned from vacation on June 2, Juarez reported the confrontation. (Reeves, supra, 121 Cal.App.4th at p. 103.) Demarest discussed it with Sparks and another worker “but never with plaintiff,” then on June 8 called Safeway security officer Darrell Harrison, telling him Reeves “is suspected of pushing Sandy Juarez … . It’s obviously a security issue, possibly workplace violence,” and asking Harrison to “take over the investigation.” (Ibid.) “There is no evidence that Demarest spoke to human resources before contacting security.” (Ibid.) Harrison conducted an “investigation,” interviewed Reeves on June 17, and on or before June 30 telephoned Hollis to report his findings and “recommended that plaintiff be discharged.” (Id. at pp. 103–104.)

The formal decision belonged to Hollis, and it was thin. “Hollis decided to terminate plaintiff’s employment before the conversation ended,” based “entirely on what Harrison told her in a 20-minute telephone conversation, the contents of which she appeared largely unable to recall.” (Reeves, supra, 121 Cal.App.4th at pp. 104, 110.) She did not review Reeves’s personnel file, was unaware of his commendations, was “unfamiliar with his version of the incident,” and — critically — “had no knowledge that plaintiff had complained about sexual harassment prior to his discharge.” (Id. at p. 104.) On July 1, 1998, she sent Reeves a letter terminating him “for violation of company policy and/or procedures.” (Id. at p. 105.)

Procedural history

After receiving a right-to-sue notice, Reeves sued Safeway under FEHA, alleging he was discharged in retaliation for his complaints about sexual harassment. (Reeves, supra, 121 Cal.App.4th at p. 105.) Safeway moved for summary judgment on two grounds: that Reeves “could not establish a causal link between these complaints and his discharge,” and that even if he could, Safeway “had a legitimate reason for the discharge which plaintiff could not show to be pretextual.” (Ibid.)

The trial court (Hon. Joseph F. Biafore, Jr.) split the difference. It “rejected the first argument, finding that plaintiff had made a threshold showing of a causal link,” but ruled that Safeway “met its burden of showing that it had a legitimate, non-discriminatory reason for terminating Plaintiff,” and that Reeves “failed to raise a triable issue of material fact in this regard.” (Reeves, supra, 121 Cal.App.4th at p. 105.) The court granted the motion and entered judgment for Safeway; Reeves appealed. (Ibid.)

The Court of Appeal, Sixth Appellate District, reversed. Writing for a unanimous panel, Presiding Justice Rushing — joined by Justices Premo and Elia — held that triable issues of fact precluded summary judgment, and that Hollis’s ignorance of Reeves’s protected activity could not, on this record, conclusively negate causation. (Reeves, supra, 121 Cal.App.4th at pp. 99–100, 121.) “The judgment is reversed.” (Id. at p. 121.) Before reaching the merits, the court delivered a pointed rebuke to Safeway’s separate statement, which “set forth … ‘facts’ … in terms not of relevant events but of what a witness has said about events,” and held that “the perceptions of witnesses are simply not ‘material facts,’” so that trial courts have “the inherent power to strike proposed ‘undisputed facts’ that fail to comply with the statutory requirements.” (Id. at pp. 105–106.)

Issue

The court framed the question with unusual precision: “whether an employer may be liable for retaliatory discharge when the supervisor who initiates disciplinary proceedings acts with retaliatory animus, but the cause for discipline is separately investigated and the ultimate decision to discharge the plaintiff is made by a manager with no knowledge that the worker has engaged in protected activities.” (Reeves, supra, 121 Cal.App.4th at p. 99.) In summary-judgment terms, the issue was whether Safeway conclusively negated the causation element — the “causal link between [the] protected activity and the employer’s action” — merely by showing that the formal decisionmaker, Hollis, was ignorant of Reeves’s harassment complaints. (Id. at p. 107.)

Holding

Reasoning

The summary-judgment posture set the burden squarely on the employer. Reviewing de novo, the court emphasized that “a plaintiff resisting a motion for summary judgment bears no burden to establish any element of his or her case unless and until the defendant presents evidence either affirmatively negating that element … or affirmatively showing that the plaintiff does not possess and cannot acquire evidence to prove its existence.” (Reeves, supra, 121 Cal.App.4th at p. 107, citing Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 854–855.) The court also stressed that the evidence must be viewed “in a light favorable to plaintiff as the losing party … strictly scrutinizing defendants’ own showing, and resolving any evidentiary doubts or ambiguities in plaintiff’s favor.” (Ibid.) That allocation drives the entire opinion: the question was not whether Reeves had proved retaliation, but whether Safeway had eliminated it.

The “defense of ignorance” cannot be asserted on behalf of “the employer” as a single mind. Safeway’s lead argument was that because Hollis “did not know about plaintiff’s complaints of sexual harassment, plaintiff cannot possibly show that his discharge was caused by those complaints.” (Reeves, supra, 121 Cal.App.4th at p. 107.) The court accepted the commonsense premise that “one cannot be motivated by an event or condition of which one is wholly ignorant” — but only as to a unitary actor. (Ibid.) The premise breaks down “in a world where a majority of workers are employed by large economic enterprises with layered and compartmentalized management structures,” where “decisions significantly affecting personnel are rarely if ever the responsibility of a single actor.” (Id. at pp. 107–108.) In such enterprises, “unexamined assertions about the knowledge, ignorance, or motives of ‘the employer’ may be fraught with ambiguities, untested assumptions, and begged questions.” (Id. at p. 108.)

Causation runs through any material contributor who held animus. The court located the issue where it belongs: “whether retaliatory animus was a but-for cause of the employer’s adverse action.” (Reeves, supra, 121 Cal.App.4th at p. 108.) From that premise it followed “[l]ogically” that a plaintiff “can establish the element of causation by showing that any of the persons involved in bringing about the adverse action held the requisite animus, provided that such person’s animus operated as a ‘but-for’ cause.” (Ibid.) The court illustrated the point: a supervisor annoyed by harassment complaints might fabricate or exaggerate a case of misconduct; “[a]nother manager, accepting the fabricated case at face value, may decide, entirely without animus, to discharge the plaintiff,” and “[i]t would be absurd to say that the plaintiff in such a case could not prove a causal connection.” (Id. at pp. 108–109.) The supervisor’s “utilization of a complex management structure to achieve the same result cannot have the effect of insulating the employer from a liability that would otherwise be imposed.” (Id. at p. 109.)

The ignorance defense protects only those actors who are in fact ignorant. Surveying the federal and California authorities Safeway invoked, the court found that nearly all of them “acknowledge, at least by implication, that ignorance of a worker’s protected activities or status does not afford a categorical defense unless it extends to all corporate actors who contributed materially to an adverse employment decision.” (Reeves, supra, 121 Cal.App.4th at p. 109.) In Morgan v. Regents of University of California (2000) 88 Cal.App.4th 52, for instance, “all of the actual decision makers … affirmatively stated … that they were not aware of appellant’s … past complaints.” (Id. at p. 109, quoting Morgan, at p. 73.) “[N]o case known to us,” the court concluded, “holds that the ignorance of a ‘decisionmaker’ would still categorically shield the employer from liability if other substantial contributors to the decision bore the requisite animus.” (Id. at p. 110.) Here, Hollis “was not the only actor who materially contributed to plaintiff’s discharge”; her decision “really amounted to little more than the ratification of Harrison’s recommendation,” itself the end of a chain beginning with Juarez’s report and Demarest’s referral. (Ibid.)

The McDonnell Douglas presumption is a procedural device, not the “ultimate issue.” Turning to Safeway’s nonretaliatory-motive argument, the court worked within the McDonnell Douglas framework but took pains to deflate it. Once an employer “proffers a facially sufficient lawful reason … the entire McDonnell Douglas framework ceases to have any bearing on the case, and the question becomes whether the plaintiff has shown, or can show, that the challenged action resulted in fact from discriminatory animus rather than other causes.” (Reeves, supra, 121 Cal.App.4th at p. 112, quoting Clark v. Claremont University Center (1992) 6 Cal.App.4th 639, 664.) Courts would “reduce confusion by speaking of ‘the McDonnell Douglas presumption,’” the court added, because the doctrine’s “only real effect … is to grant the plaintiff a presumption, sufficient to survive the early stages of litigation,” a presumption “just as easily torn down” by any “colorable” explanation. (Id. at p. 112, fn. 12.) Crucially, “‘pretext’ is merely one way of raising an inference of discrimination — not an indispensable precondition to such an inference.” (Id. at p. 111.) The court thus refused to let the “pretext” tail “wag the whole anti-discrimination dog.” (Ibid.)

Even granting Hollis a clean motive, Safeway addressed only one of four actors. The court accepted that the record “supports a finding that [Hollis’s] motive was not discriminatory, but disciplinary.” (Reeves, supra, 121 Cal.App.4th at p. 113.) But that showing, “[l]imited as it is to the motives of Hollis,” failed: “Safeway has failed to make a threshold showing that all material contributors to the decision acted for legitimate nondiscriminatory motives.” (Ibid.) The process “involved not two principal actors but four: Juarez … ; Demarest … ; Harrison … ; and Hollis,” and “[t]o establish an entitlement to judgment Safeway had to address the conduct, role, and motives of each,” yet “it addressed only the role and motives of the last, Hollis.” (Id. at p. 116.)

The cat’s-paw model: animus imputed through an innocent conduit. The court adopted, as a matter of California law, the doctrine most clearly articulated by Judge Posner in Shager v. Upjohn Co. (7th Cir. 1990) 913 F.2d 398. “To establish an entitlement to judgment as a matter of law, it is not enough to show that one actor acted for lawful reasons when that actor may be found to have operated as a mere instrumentality or conduit for others who acted out of discriminatory or retaliatory animus,” and “[i]f a supervisor makes another his tool for carrying out a discriminatory action, the original actor’s purpose will be imputed to the tool, or through the tool to their common employer.” (Reeves, supra, 121 Cal.App.4th at p. 113.) Quoting Shager, the court explained that a decisionmaking committee’s innocence “would not spare the company from liability” if “[i]t acted as the conduit of [the supervisor’s] prejudice — his cat’s-paw.” (Id. at p. 114, quoting Shager, at p. 405.) Noting that the United States Supreme Court cited Shager with approval in Burlington Industries, Inc. v. Ellerth (1998) 524 U.S. 742, and “substantially adopted such a theory” in Reeves v. Sanderson Plumbing Products, Inc. (2000) 530 U.S. 133, the court canvassed the circuits and found the model “adopted or referred to approvingly in all but one.” (Id. at pp. 114–115.)

The court declined to follow the Fourth Circuit’s contrary view. The lone outlier was the Fourth Circuit’s en banc decision in Hill v. Lockheed Martin Logistics Management, Inc. (4th Cir. 2004) 354 F.3d 277, which the court read to have “rejected the theory, or restricted it to arguable invisibility.” (Reeves, supra, 121 Cal.App.4th at p. 116, fn. 16.) The panel was unsparing: “We find the analysis in that case unpersuasive, and decline to intrude on its splendid solitude.” (Ibid.) “We have no doubt,” the court announced, “that California law will follow the overwhelming weight of federal authority and hold employers responsible where discriminatory or retaliatory actions by supervisory personnel bring about adverse employment actions through the instrumentality or conduit of other corporate actors who may be entirely innocent of discriminatory or retaliatory animus.” (Ibid.) The court also broadened the metaphor beyond Aesop’s duped cat: imputation is justified “by any set of facts that would permit a jury to find that an intermediary, for whatever reasons, simply carried out the will of the actuator,” witting or not. (Id. at pp. 114–115, fn. 14.)

Applied to the record, every link in the chain raised a triable issue. As to Demarest — Reeves’s “unquestioned supervisor” — there was “ample basis for finding retaliatory motives and conduct.” (Reeves, supra, 121 Cal.App.4th at p. 117.) He “resented and opposed plaintiff’s efforts to secure relief for the women,” bypassed human resources, conducted a doubtful investigation of his own, acted “entirely on the basis of accounts from Juarez and Sparks” without ever speaking to Reeves, and framed the matter to security as “possible workplace violence,” knowing — by his own admission that every comparable referral had ended in dismissal — that referral was “substantially certain to result in the dismissal of a 29-year veteran employee.” (Id. at pp. 117–118.) As to Harrison, the court found the record “devoid of direct evidence that he acted without retaliatory motive,” a triable issue as to whether Reeves told him about the harassment complaints, and ample evidence that his investigation “was not truly independent, but was heavily skewed to favor the … conclusions of the reporting supervisor.” (Id. at pp. 118–119.) Harrison’s report labeled Juarez “Victim” and Reeves “Suspect,” treated Reeves’s account “as a story” while presenting “the Juarez/Sparks version … as history,” and disparaged Reeves’s medical explanation — supporting an inference that Harrison was “a sort of institutionalized ‘cat’s paw.’” (Id. at pp. 119–120.) Because “the task of disambiguating ambiguous utterances is for trial, not for summary judgment,” a jury had to resolve these inferences. (Id. at p. 119, quoting Shager, at p. 402.)

A measured conclusion. The court was careful to disclaim any view of the merits: “our analysis is confined to evaluating inferences which may, but need not, be drawn from this record. … Our task must end with the conclusion that they are inferences a reasonable factfinder could draw.” (Reeves, supra, 121 Cal.App.4th at p. 120.) A rational fact finder “could conclude that an incident of minor and excusable disregard for a supervisor’s stated preferences was amplified into a ‘solid case’ of ‘workplace violence,’” driven “in necessary part by a supervisor’s desire to rid himself of a worker who created trouble by complaining of matters the supervisor preferred to ignore.” (Ibid.) “Since those complaints were protected activities under FEHA, a finder of fact must be permitted to decide whether these inferences should in fact be drawn.” (Id. at p. 121.) The panel was unanimous; there was no concurrence or dissent.

Significance

Reeves v. Safeway Stores is the foundational California “cat’s paw” decision, the case to which later courts and CACI trace the rule that a biased subordinate’s animus can be imputed to an employer through a neutral decisionmaker. Its central contribution is to relocate the causation inquiry from the formal decisionmaker’s state of mind to the motives of every actor who “materially contributed” to the adverse action. (Reeves, supra, 121 Cal.App.4th at p. 110.) After Reeves, an employer cannot win summary judgment in a retaliation case simply by producing a declaration from an executive who swears she had never heard of the plaintiff’s complaints; it must account for the supervisors and investigators who built the case the executive merely ratified. The decision thus closes what the court called the “defense of ignorance” loophole that “layered and compartmentalized management structures” would otherwise create. (Id. at pp. 107–108.)

The opinion also matters for what counts as protected activity. The plaintiff was fired not for opposing his own mistreatment but for advocating on behalf of female coworkers he believed were being harassed — and the court treated that opposition as fully protected under section 12940, subdivision (h). (Reeves, supra, 121 Cal.App.4th at p. 121.) That makes Reeves a useful authority for the bystander or intervenor who suffers reprisal for taking up a colleague’s cause. The decision’s reasoning was later absorbed into mainstream California retaliation doctrine and echoed by the United States Supreme Court’s cat’s-paw analysis in Staub v. Proctor Hospital (2011) 562 U.S. 411, which post-dates Reeves but adopts the same “proximate cause through a biased subordinate” logic. The opinion is equally notable as a primer on summary-judgment practice: its insistence that “perceptions of witnesses are simply not ‘material facts’” (id. at p. 106) and its deflation of “pretext” as the supposed “ultimate issue” (id. at p. 111) are frequently cited well outside the cat’s-paw context.

Key quotes

“[S]o long as the supervisor’s retaliatory motive was an actuating, but-for cause of the dismissal, the employer may be liable for retaliatory discharge.” (Reeves, supra, 121 Cal.App.4th at p. 100.)

“[T]he plaintiff can establish the element of causation by showing that any of the persons involved in bringing about the adverse action held the requisite animus, provided that such person’s animus operated as a ‘but-for’ cause … . Certainly a defendant does not conclusively negate the element of causation by showing only that some responsible actors, but not all, were ignorant of the occasion for retaliation.” (Id. at p. 108.)

“If a supervisor makes another his tool for carrying out a discriminatory action, the original actor’s purpose will be imputed to the tool, or through the tool to their common employer.” (Id. at p. 113.)

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Practice pointer

Open questions

The opinion expressly reserved several questions adjacent to its holding. First, the court assumed but did not decide that Demarest’s supervisory status would permit imputation, cautioning that “these issues have not yet been addressed by the parties, and we should not be understood to have actually decided them.” (Reeves, supra, 121 Cal.App.4th at p. 109, fn. 9.) Left open, then, is the precise boundary of imputation where the only actor with animus is a nonsupervisory coworker rather than a supervisor — a problem the court flagged but did not resolve. (Ibid.)

Second, the court declined to decide the role of Juarez, the night-crew supervisor whose report began the chain, “because neither party has directed any attention to the question of whether her position would justify an imputation of her motives to Safeway,” noting “only the bare possibility that she may have occupied some sort of supervisory role.” (Reeves, supra, 121 Cal.App.4th at pp. 116–117.) Whether a first-link reporter’s motives can be imputed where her supervisory status is uncertain remains unsettled on this record.

Third, the court “f[ound] it unnecessary to consider plaintiff’s argument that the inadequacies in Safeway’s investigation are evidence of pretext, by extension of the holding in Cotran v. Rollins Hudig Hall Internat., Inc. (1998) 17 Cal.4th 93,” leaving for another day whether a deficient investigation independently supports an inference of pretext in the FEHA retaliation setting. (Reeves, supra, 121 Cal.App.4th at p. 120, fn. 21.) Finally, by resolving the case under the McDonnell Douglas presumption — the only model the plaintiff invoked — the court left the relationship between cat’s-paw causation and “mixed motive” analysis under Desert Palace, Inc. v. Costa (2003) 539 U.S. 90 unexplored. (Id. at p. 111, fn. 11.)