$160,000 Settlement in Disability Discrimination Case Against Beverage Distributor, Training Ordered

 
Tuesday, December 8, 2015
 

Question:  Would disability discrimination training have prevented this case?  See our trainings at http://www.hrclassroom.com.
Beverage Distributors Company, a wholesale liquor distribution company in Colorado, will pay $160,000 and furnish other relief to settle a disability discrimination lawsuit filed by the U.S. Equal Employment Opportunity Commission (EEOC). 

According to EEOC's lawsuit (EEOC v. Beverage Distributors Company, LLC, Civil Action No. 11-cv-02557-CMA-CBS), Michael Sungaila, who is legally blind, worked for Beverage for over four years as a driver's helper. When the company decided to eliminate his position and instead use contract laborers, Sungaila applied for a position as a night warehouse associate. Beverage offered Sungaila the position subject to a pre-employment medical examination. Following the examination, Beverage withdrew the job offer to Sungaila due to his poor eyesight. The position involves, among other things, loading cases of liquor and kegs of beer into the back of trucks. EEOC contended Sungaila could safely perform the job. 

Following a four-day trial in April 2014, an eight-person Denver jury unanimously agreed with EEOC that Beverage intentionally violated the Americans with Disabilities Act (ADA) when it withdrew its job offer to Sungaila because of his impaired eyesight. The jury initially awarded Sungaila $132,347 in back pay, but found that his damages should be reduced because the jury believed that Sungaila could have mitigated his damages by finding a comparable position. U.S. District Court Judge Christine Arguello vacated the jury's finding that Sungaila could have mitigated his damages, finding that Beverage failed to prove there were any available comparable jobs that Sungaila could have performed. Judge Arguello ordered Beverage to pay Sungaila his entire back pay and interest on the award and compensate Sungaila for any tax consequence he would suffer due to being paid the judgment in one year. The parties agreed that this relief totaled $186,295.

Beverage appealed the jury verdict and judgment to the U.S. Court of Appeals for the Tenth Circuit, arguing that the direct threat jury instruction was erroneous, the evidence presented at trial could have allowed the jury to find a failure to mitigate damages, and the district court abused its discretion in awarding Sungaila a tax penalty offset. The Tenth Circuit concluded that the district court did not err in awarding the tax offset, which totaled $18,805. The court's ruling on the tax offset issue is very important for plaintiffs in the Tenth Circuit because it ensures that they are made whole. The court declined to address Beverage's argument regarding the mitigation evidence issue. It found that the direct threat instruction did not completely reflect the direct threat standard and remanded the case to the district court for retrial. Another trial was scheduled to begin in February 2016.

The settlement entered into by the parties in the form of a court-approved public consent decree requires Beverage to pay Sungaila $160,000 to resolve the case. Beverage will also conduct ADA training for all employees and managers on the ADA's requirements, including limitations on post-offer / pre-employment medical screening and the need to provide reasonable accommodation to qualified individuals with disabilities; revise and distribute its ADA policy and procedures, including those related to providing reasonable accommodations to employees; and report to EEOC if there are any complaints of disability discrimination. The district court approved the settlement and will retain jurisdiction for purposes of compliance for two years. 

Beverage Distributors Company employs more than 600 people and is a member of The Charmer Sunbelt Group (CSG), one of the nation's leading distributors of fine wines, spirits, beer, and other beverages. CSG operates local distributor and brokerage houses across the United States.

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