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Wunderlin v. AB Car Rental Services, Inc.

United States District Court, D. Hawaii

October 17, 2018

AB CAR RENTAL SERVICES, INC., et al., Defendants.


          Jill A. Otake United States District Judge


         Plaintiff Nathan Wunderlin (“Plaintiff”) sued his former employer, Defendant AB Car Rental Services, Inc. (“Defendant”), [1] pursuant to Hawai‘i law, alleging that he was unlawfully terminated based on his ancestry, race, and color; that he suffered a hostile work environment and retaliation; and that he should be awarded punitive damages. Defendant seeks summary judgment, or, in the alternative, partial summary judgment. For the reasons set forth below, the Motion is GRANTED IN PART and DENIED IN PART.


         A. Facts

         Unless otherwise indicated, the following facts are not in dispute. Plaintiff, a Caucasian male, worked at Defendant's Kailua-Kona Airport location from April 27, 2008 until his termination on July 22, 2015. Plaintiff's Concise Statement of Facts (“Pl.'s CSF”), Decl. of Nathan Wunderlin (“Wunderlin Decl.”) at ¶¶ 3, 4, 191. Plaintiff worked as a rental sales agent (RSA), and his hourly wage was supplemented by incentive pay for “upsells”-the sale of additional insurance coverage and rental products. Decl. of Christopher Rolletta (“Rolletta Decl.”) at ¶¶ 7-8. He earned a high income consistent with that of a good salesperson. Pl.'s CSF, Ex. F; Defendant's Concise Statement of Facts (“Def.'s CSF”) at ¶ 4.

         Defendant required all employees, including Plaintiff, to follow its policies and rules, which included the Code of Conduct and Business Principles, Work Rules, and Customer Service and Sales Rules of the Road. Def.'s CSF at ¶ 4. These policies and rules prohibited employees from selling a more expensive rental or charging for insurance without the customers' approval, making adjustments at the end of a sale, modifying rental agreements with the intent of defrauding the customer, or behaving dishonestly toward or manipulating customers. Id. at ¶¶ 5, 7.

         Plaintiff's first supervisor was a Caucasian male, who was replaced sometime at the end of 2013 or the beginning of 2014 by Allen Inda, a Filipino male. Id., Rolletta Decl. at ¶ 6; Pl.'s CSF, Wunderlin Decl. at ¶¶ 5, 17. Cheryl Beimes, whose ethnicity is in dispute, also supervised Plaintiff. Def.'s CSF, Rolletta Decl. at ¶ 6; Pl.'s CSF, Wunderlin Decl. at ¶ 22. Mark Winkleman, a Caucasian male, was Defendant's operations manager. Pl.'s CSF, Declaration of Mark Winkleman (“Winkleman Decl.”) at ¶¶ 3-4. According to Winkleman, Inda instructed him to monitor and keep separate files of customer complaints against Plaintiff and Kevin Ditty, another Caucasian male. Pl.'s CSF, Winkleman Decl. at ¶ 7. Inda did not tell Winkleman to monitor or keep files of anyone else. Id. at ¶ 12.

         Between 2008 and 2015, Plaintiff received approximately a dozen warnings for violations of work rules. Def.'s CSF at ¶ 8. For instance, on May 28, 2014, Defendant gave Plaintiff his first warning for defrauding customers. Def.'s CSF, Ex. 15. On November 9, 2014, Defendant issued Plaintiff a written warning for charging customers for upgrades and coverages without their consent. Id., Ex. 16. Plaintiff admits receiving the write-ups but denies the accuracy of the allegations. Pl.'s CSF at ¶ 22.

         On January 9, 2015, a state agency performed an audit at the Kailua-Kona Airport location. Def.'s CSF, Ex. 8. According to Plaintiff's written warning, the agency sent a letter to Defendant, dated January 20, 2015, reporting that an investigator witnessed Plaintiff lying to a customer and adding insurance to a purchase after the customer declined such insurance. Def.'s CSF, Ex. 8. The parties dispute the accuracy of the state agency's letter. Following the receipt of this state agency's letter, Defendant received two more customer complaints alleging that Plaintiff added unauthorized charges to purchases. Id. On April 2, 2015, Defendant suspended Plaintiff and issued him a final written warning for violating company policy. Id. Plaintiff had received a total of fifteen customer complaints prior to his suspension. Id., Exs. 15, 16.

         In an email dated April 8, 2015, Plaintiff informed Inda and a member of the Human Resources Division for the first time that he believed his reprimands and suspension were the result of race discrimination. He made no mention of a hostile work environment. Id., Ex. 9.

         By letter dated May 4, 2015, addressed to Human Resources Director Christopher Rolletta, Plaintiff first reported instances of racially charged comments. Id. at ¶ 16. Plaintiff described racial tension in the workplace, and multiple instances of the derogatory use of the word “haole.” Id. & Ex. 11. Thereafter, Defendant sent Martin Mylott, the Hawai‘i Regional Manager, and Gail Sugimoto, the local Human Resources manager, to the Kailua-Kona location to investigate. In collaboration with Rolletta, they determined that there had been no race-based misconduct by any of Plaintiff's coworkers. Def.'s CSF at ¶¶ 34-35.

         At the hearing on the Motion, Plaintiff's counsel conceded that the record is unclear as to how many additional racially derogatory comments were made by non-white employees after the investigation. However, he identified an incident on April 9, 2015, during which a coworker told Plaintiff that a cultural rites dispute was occurring “because of all you fucking haoles who came over and messed up our land.” Pl.'s CSF, Wunderlin Decl. ¶ 71. Beimes was present when the statement was made, but at the hearing, the parties disputed whether she had heard it. Although this incident allegedly happened after Plaintiff sent the email alleging race discrimination on April 8, 2018, it occurred before Defendant's investigation into Plaintiff's allegations.

         Upon his return from suspension, Plaintiff received seven more customer complaints. He again does not challenge the fact of the complaints, but rather the truth of their substance. Def.'s CSF at ¶ 36; Pl.'s CSF at ¶ 36. Sugimoto advised Plaintiff of the complaints on July 2, 2015, and Mylott terminated him on July 22, 2015. Def.'s CSF at ¶¶ 37-38. The decision to terminate Plaintiff was made primarily by Mylott, with assistance from Rolletta. Id., Rolletta Decl. at ¶ 28. Defendant also terminated Ditty for misleading customers and charging for insurance after customers declined. Def.'s CSF at ¶ 24.

         Plaintiff also contends that Defendant did not terminate Isaac Flores, a non-Caucasian RSA who received similar customer complaints. Pl.'s CSF at ¶ 51. It is undisputed that Defendant suspended Flores and that he resigned thereafter. Pl.'s CSF at ¶ 51; Def.'s CSF at ¶ 51.

         B. Procedural History

         Plaintiff filed his Complaint in the Circuit Court of the Third Circuit, State of Hawai‘i, on May 23, 2017, which Defendant then removed to this Court on August 9, 2017. Doc. No. 1. The Complaint alleges that Defendant discriminated against Plaintiff on the basis of his ancestry (Count I), race (Count II), and color (Count III); that he was subject to a hostile work environment (Counts I, II, and III); and that Defendant retaliated against him (Count IV), in violation of Hawai‘i Revised Statutes (“HRS”) §§ 378-2(a)(1)(A) and 378-2(a)(2).[2] Doc. No. 1-1 at ¶¶ 182-200. Plaintiff seeks various compensatory damages and relief, as well as punitive damages. Doc. No. 1-1 at ¶ D.

         Defendant filed the present Motion for Summary Judgment on June 1, 2018. Doc. No. 26. Plaintiff filed an opposition on July 20, 2018. Doc. No. 31. Defendant submitted its Reply on July 27, 2018. Doc. No. 33. The Motion was heard on October 3, 2018.


         Summary judgment is appropriate when there is no genuine issue of material fact and the moving party is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(a). “A party seeking summary judgment bears the initial burden of informing the court of the basis for its motion and of identifying those portions of the pleadings and discovery responses that demonstrate the absence of a genuine issue of material fact.” Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007) (citing Celotex Corp. v. Citrate, 477 U.S. 317, 323 (1986)); T.W. Elec. Serv., Inc. v. Pac. Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987). On a motion for summary judgment, the court must view the facts in the light most favorable to the nonmoving party. State Farm Fire & Cas. Co. v. Martin, 872 F.2d 319, 320 (9th Cir. 1989).

         Once the moving party has met its burden of demonstrating the absence of any genuine issue of material fact, the nonmoving party must set forth specific facts showing that there is a genuine issue for trial. T.W. Elec., 809 F.2d at 630; Fed.R.Civ.P. 56(c). The opposing party may not defeat a motion for summary judgment in the absence of any significant probative evidence tending to support its legal theory. Intel Corp. v. Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991). The nonmoving party cannot stand on its pleadings, nor can it simply assert that it will be able to discredit the movant's evidence at trial. T.W. Elec., 809 F.2d at 630; Blue Ocean Pres. Soc'y v. Watkins, 754 F.Supp. 1450, 1455 (D. Haw. 1991).

         If the nonmoving party fails to assert specific facts, beyond the mere allegations or denials in its response, summary judgment may be entered. Lujan v. Nat'l Wildlife Fed'n, 497 U.S. 871, 884 (1990); Fed.R.Civ.P. 56(e). There is no genuine issue of fact if the opposing party fails to offer evidence “sufficient to establish the existence of an element essential to that party's case[.]” Celotex, 477 U.S. at 322.

         In considering a motion for summary judgment, “the court's ultimate inquiry is to determine whether the ‘specific facts' set forth by the nonmoving party, coupled with undisputed background or contextual facts, are such that a rational or reasonable jury might return a verdict in its favor based on that evidence.” T.W. Elec., 809 F.2d at 631 (citing Anderson v. Liberty Lobby, 477 U.S. 242, 255 (1986)). Inferences must be drawn in favor of the nonmoving party. Id. However, when the opposing party offers no direct evidence of a material fact, inferences may be drawn only if they are reasonable in light of the other undisputed background or contextual facts and if they are permissible under the governing substantive law. Id. at 631-32. If the factual context makes the opposing party's claim implausible, that party must come forward with more persuasive evidence than otherwise necessary to show there is a genuine issue for trial. Bator v. Hawaii, 39 F.3d 1021, 1026 (9th Cir. 1994) (citing Cal. Architectural Bldg. Prods., Inc. v. Franciscan Ceramics, 818 F.2d 1466, 1468 (9th Cir. 1987)).


         A. The Sham Affidavit Allegation

         As a preliminary matter, the Court addresses Defendant's request to strike certain paragraphs from Plaintiff's Declaration as a sham declaration. Def.'s Reply 1. Specifically, Defendant asks the Court to strike paragraphs 79, 89, 102, 104, and 162 of the Declaration because they either contain contradictions with his deposition testimony or address information he could not recall in his deposition. The Court denies the request.

         The sham affidavit rule prevents a party from creating “an issue of fact by an affidavit contradicting his prior deposition testimony.” Kennedy v. Allied Mut. Ins. Co., 952 F.2d 262, 266 (9th Cir. 1991). It “does not automatically dispose of every case in which a contradictory affidavit is introduced to explain portions of earlier deposition testimony.” Id. at 266-67. “In order to trigger the sham affidavit rule, the district court must make a factual determination that the contradiction is a sham, and the ‘inconsistency between a party's deposition testimony and subsequent affidavit must be clear and unambiguous to justify striking the affidavit.'” Yeager v. Bowlin, 693 F.3d 1076, 1080 (9th Cir. 2012) (quoting Van Asdale v. Int'l Game Tech., 577 F.3d 989, 998-99 (9th Cir. 2009)). “[T]he non-moving party is not precluded from elaborating upon, explaining or clarifying prior testimony elicited by opposing counsel on deposition; minor inconsistencies that result from an honest discrepancy, a mistake, or newly discovered evidence afford no basis for excluding an opposition ...

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