FedEx Manager’s $366 Million Retaliation Win Cut to $249,000

FedEx Corporate Services Inc. convinced a Fifth Circuit panel to undo a $366 million jury award for a Black former executive who sued the company alleging retaliation.

Jennifer Harris wasn’t entitled to the $365 million punitive damages portion of the jury’s award because FedEx “made good-faith efforts to comply with Title VII” of the Civil Rights Act of 1964, the US Court of Appeals for the Fifth Circuit said Thursday.

Harris is only entitled to $248,619 in compensatory damages for emotional distress as to her Title VII retaliation claim, Judge Cory T. Wilson said.

The decision also addressed the propriety of contractual agreements that shorten a worker’s time to sue for bias from a deadline set by law. The panel agreed with FedEx that the provision included in the parties’ agreement barred Harris’ retaliation claim under 42 U.S.C. §1981.

Such agreements are valid if reasonable, and the Sixth and Seventh circuits have upheld the validity of six-month statutes of limitation when set by contract, Wilson said.

The six months FedEx gave Harris to sue under her employment agreements was likewise reasonable and enforceable, and the district court erred by allowing her §1981 claims to proceed to trial, Wilson said. The district court determination had “outsized importance” in this case because §1981 claims aren’t subject to statutory caps, but Title VII claims are, he said.

The jury had awarded her $1.16 million in compensatory damages in addition to the punitive award. But, because the panel reversed the trial court’s denial of FedEx’s request to bar her §1981 claims, the most she could have recovered is the Title VII maximum, $300,000, Wilson said. The appeals court reduced it further still.

Damages Award

Although the court affirmed the jury’s finding that Harris’s supervisor retaliated against her, Harris didn’t meet her higher burden to show that her supervisor did so “in the face of a perceived risk that her actions would violate federal law,” the court said.

Each time Harris filed an internal complaint, human resources conducted an in-depth investigation, the court said. “FedEx’s actions in this case are unlike other cases where this court has found companies vicariously liable for punitive damages because they ignored the plaintiff’s complaints,” the court said.

As to the compensatory damages, Harris testified “at length” about the emotional distress she suffered, including stress, anxiety, lack of sleep, and weight gain, Wilson said. That evidence is more than cursory and she is entitled to more than nominal damages, Wilson said. However, her symptoms don’t warrant a $300,000 compensatory damage award, he added.

Judges Leslie H. Southwick, Kurt D. Engelhardt joined the opinion.

The Sanford Firm represented Harris. Lehotsky Keller Cohn LLP and in-house counsel represented FedEx Corp.

The case is Harris v. FedEx Corp. Servs., Inc., 5th Cir., No. 23-20035, 2/1/24.