Vargas v. Riverbend Mgmt.

314 A.3d 241

2024 ME 27

Tiffany VARGAS et al.

v.RIVERBEND MANAGEMENT LLC

Docket: Cum-23-249

Supreme Judicial Court of Maine.

Argued: February 7, 2024

Decided: April 18, 2024

James A. Clifford, Esq. (orally), and Andrew P. Cotter, Esq., Clifford & Clifford, LLC, Portland, for appellants Tiffany Vargas and Erika Acevedo David A. Goldman, Esq. (orally), Norman, Hanson & DeTroy, LLC, Portland, for appellee Riverbend Management LLC

Peter Mancuso, Esq., and Pamela Lee, Esq., Borealis Law PLLC, Portland, for amicus curiae Maine Employment Lawyers Association

Panel: STANFILL, C.J., and MEAD, HORTON, CONNORS, LAWRENCE, and DOUGLAS, JJ.

HORTON, J.

[¶1] We are called to consider the standard governing an employer’s vicarious liability under the Maine Human Rights Act (MHRA), 5 M.R.S. §§ 4551-4634 (2023), for an employee’s discriminatory behavior toward a customer. Tiffany Vargas and Erika Acevedo appeal from a judgment entered after a bench trial in favor of Riverbend Management, LLC, by the Superior Court (Cumberland County, McKeon, J.) on their claims of race discrimination in violation of the MHRA. After making findings of fact orally on the record at the close of trial, the court concluded that Riverbend was not vicariously liable for a racial slur directed at Vargas and Acevedo by one of Riverbend’s employees while the employee was working at Riverbend’s premises. In light of the court’s findings, the record evidence, and the factors relevant to vicarious liability, we affirm the judgment.

I. BACKGROUND

A. Facts

[¶2] The following summary is based on the court’s express findings, all of which are supported by the record. See Hum. Rts. Def. Ctr. v. Me. Cnty. Cmm’rs Ass'n Self-Funded Risk Mgmt. Pool, 2023 ME 56, ¶ 3, 301 A.3d 782.

[¶3] Vargas’s ethnicity is African-American, Native-American, and Portuguese, and Acevedo is a Dominican-born Latina. Vargas has experienced racism growing up in Maine.

[¶4] On August 16, 2020, Vargas and Acevedo stopped for a cup of iced coffee at a McDonald’s restaurant located on Forest Avenue in Portland. The Forest Avenue McDonald’s restaurant is owned and operated by Riverbend Management Company, LLC. Scott Lydick is the sole member of Riverbend and is involved in the management and operation of the restaurant.

[¶5] There are three stations at the McDonald’s drive-through: the unstaffed station where customers speak into a microphone and deliver their orders, the staffed "pay window" where customers pay, and the staffed "present window" where an employee hands customers their purchases.

[¶6] Vargas and Acevedo placed their order at the first station, paid at the second station, and proceeded to the present window, where a Riverbend employee named Andrew Mosley handed the iced coffee to Vargas. Vargas asked him for a cup of ice. Mosley informed her that, to get the cup of ice, they would have to go through the drive-through again. This irritated Vargas. Vargas asked Mosley for his name and he said, "Bubba." Mosley closed the window and left. Vargas waved to another Riverbend employee, Mohammed Muhee, who came to the window. After Vargas reiterated her request, Muhee gave her a cup of ice and said something along the lines of, "Don’t mind him, he’s this way sometimes." Vargas asked Muhee for Mosley’s name, and Muhee told her that his name was Andrew.

[¶7] After Vargas and Acevedo drove away from the window, they saw Mosley delivering food to another car in the parking lot. As Mosley walked back to the McDonald’s building, Vargas called out to him something like "Good day, Andrew" or "Have a nice day, Andrew." Mosley responded by angrily cursing at her and Acevedo and delivering a profoundly offensive racial slur.¹

[¶8] On the next day, August 17, 2020, Vargas made a complaint about Mosley to the national corporate office of McDonald’s, which promptly notified Riverbend. Lydick immediately forwarded the complaint to the restaurant manager, Faye Welsh, requesting that she investigate Vargas’s complaint. Welsh interviewed Mosley, who gave a different version of what occurred. Lydick directed Welsh to terminate Mosley’s employment. Lydick also reached out to Vargas twice by email and at least once by phone.

B. Procedure

[¶9] Vargas and Acevedo initially filed a complaint with the Maine Human Rights Commission, which issued a right-to-sue letter entitling them to commence an action in the Superior Court for damages and attorney fees. 5 M.R.S. §§ 4612(6), 4621, 4622(1)(C). On December 2, 2021, Vargas and Acevedo filed a complaint in the Superior Court against Riverbend alleging race and gender discrimination under the Maine Human Rights Act (MHRA). See 5 M.R.S. §§ 4551-4634. On January 31, 2022, Riverbend filed an answer containing affirmative defenses, denying any violation of the MHRA.

[¶10] On December 2, 2022, Riverbend filed a motion for summary judgment along with six exhibits. The motion asserted that Riverbend is not vicariously liable for the race discrimination committed by its employee and that Vargas and Acevedo had not asserted a valid gender discrimination claim. In opposing the motion, Vargas and Acevedo contended that Riverbend is vicariously liable for the actions of its employee because Mosley was acting in the scope of employment when he made the discriminatory comment.

[¶11] On March 21, 2023, the court entered an order on Riverbend’s motions for summary judgment. The court partially granted the motion for summary judgment, entering judgment in favor of Riverbend on the gender discrimination claim because Vargas and Acevedo had not raised a gender discrimination claim before the Commission and therefore could not seek damages or attorney fees. 5 M.R.S. § 4622(1)(C). The court denied summary judgment on the race-discrimination claim.

[¶12] The court held a bench trial on May 11 and 15, 2023. The court heard testimony from Vargas, Acevedo, Muhee, Lydick, and Welsh. The court made oral findings following trial, finding for Riverbend. The court determined that Mosley violated the MHRA when he used a racial slur against Vargas and Acevedo but concluded that Riverbend was not vicariously liable for Mosley’s actions.

[¶13] On May 25, 2023, Vargas and Acevedo filed a motion to alter or amend the judgment, and Riverbend opposed it. M.R. Civ. P. 59(e). On July 3, 2023, the court denied the motion. Relying on both the Restatement (Second) of Agency (Am. L. Inst. 1958) and the Restatement (Third) of Agency (Am. L. Inst. 2006), the court noted that the result "would be the same under either" and that Riverbend was not vicariously liable because Mosley’s conduct was "not actuated by a purpose to serve the [employer]."²

[¶14] Vargas and Acevedo filed a timely appeal.³ See M.R. App. P. 2B(c)(1); 14 M.R.S. § 1851 (2023).

II. DISCUSSION

A. Standard of Review

[1–3] [¶15] Whether an employer can be held vicariously liable for the conduct of an employee toward a third party involves the application of law to facts. "We review the court’s factual findings for clear error and its legal conclusions de novo." Lyman v. Huber, 2010 ME 139, ¶ 19 n.2, 10 A.3d 707; see Dussault v. RRE Coach Lantern Holdings, LLC, 2014 ME 8, ¶ 12, 86 A.3d 52 ("We review the court’s interpretation and application of the MHRA de novo"). Here, the court expressed some findings of fact orally on the record, but we may infer additional facts essential to the court’s ruling. See Lyman, 2010 ME 139, ¶ 19 n.2, 10 A.3d 707 ("In the absence of a motion for additional findings of fact, we will infer that the court found all the facts necessary to support its decision, and we will inquire whether such inferred findings are supported by the record.").

B. The MHRA’s Prohibition on Discrimination in Public Accommodations

[¶16] The MHRA prohibits discrimination in employment, housing, credit extension, education, and places of public accommodation based on race, color, sex, sexual orientation or gender identity, physical or mental disability, religion, ancestry or national origin, age, and familial status. See 5 M.R.S. § 4552. "The opportunity for every individual to have equal access to places of public accommodation without discrimination because of race, color, … or national origin is recognized as and declared to be a civil right." 5 M.R.S. § 4591. A "place of public accommodation" is "a facility, operated by a public entity or private entity, whose operations fall within" a number of categories, including "a restaurant, eating house, .. or other establishment serving or selling food or drink."⁴ 5 M.R.S. § 4553(8)(B).

[¶17] The MHRA prohibition against discrimination at places of public accommodation is sweeping:

It is unlawful public accommodations discrimination, in violation of this Act[,] … [f]or any public accommodation or any person who is the owner, lessor, lessee, proprietor, operator, manager, superintendent, agent or employee of any place of public accommodation to directly or indirectly refuse, discriminate against or in any manner withhold from or deny the full and equal enjoyment to any person, on account of race or color, sex, sexual orientation or gender identity, age, physical or mental disability, religion, ancestry or national origin, any of the accommodations, advantages, facilities, goods, services or privileges of public accommodation, or in any manner discriminate against any person in the price, terms or conditions upon which access to accommodations, advantages, facilities, goods, services and privilegesmay depend.⁵

5 M.R.S. § 4592(1); see Me. Hum. Rts. Comm'n v. Le Club Calumet, 609 A.2d 285, 286-87 (Me. 1992) (defining the elements of a claim of discrimination at a place of public accommodation).

[¶18] Riverbend has not disputed that Mosley’s use of a racial slur toward Vargas and Acevedo after they had purchased food constituted discrimination on account of race at a place of public accommodation in violation of MHRA. The sole question presented to us is whether the trial court should have held Riverbend...