Federal Appeals Court Nullifies $366M FedEx Race Bias Verdict

A federal appeals court on Thursday Feb. 1 dismissed a $366.2 million verdict against FedEx (FDX.N), in a lawsuit filed by a Black sales manager who alleged the package delivery giant terminated her employment in retaliation for her race discrimination complaints against a supervisor.

The 5th U.S. Circuit Court of Appeals ruled that Jennifer Harris, the plaintiff, was not entitled to the $365 million in punitive damages awarded by a Houston jury in October 2022.

Furthermore, the court significantly reduced Harris’ compensation for pain and suffering, mental anguish, and inconvenience to $248,620 from the initial $1.16 million, even though it acknowledged sufficient evidence to substantiate her retaliation claim.

Requests for comments from Harris’ legal team received no immediate response. Similarly, FedEx and its attorneys have yet to respond to inquiries regarding the ruling.

The original award against FedEx, based in Memphis, Tennessee, had ranked among the largest for a U.S. workplace bias or retaliation lawsuit involving a single employee.

Harris, who had been with FedEx for over 12 years, ascending from a sales representative to a district sales manager, was dismissed in January 2020. She contended that her termination was a direct consequence of her complaints against her supervisor—a white woman—accusing her of issuing an unjust performance review and attempting to demote her.

However, the New Orleans-based appeals court stated that Harris failed to meet the stringent criteria set by Title VII of the Civil Rights Act of 1964, which required proving FedEx’s malice or reckless disregard for the possibility that its actions might breach federal law.

Circuit Judge Cory Wilson noted that the evidence implied the supervisor believed Harris warranted disciplinary action for insubordination rather than as a punitive measure for her discrimination complaints.

“Punitive damages hinge on the employer’s subjective intent,” Wilson wrote, representing the unanimous view of the three-judge panel.

The case, Harris v. FedEx Corporate Services Inc, was heard by the 5th U.S. Circuit Court of Appeals under docket number 23-20035.

Sources: AirGuide Business airguide.info, bing.com, reuters.com