Daemi v. Church's Fried Chicken, Inc.

• Decision Date: 23 April 1991
• Docket Number: No. 86-1584,86-1584
• Citation: 931 F.2d 1379
• Parties: 59 Fair Empl.Prac.Cas. 395, 56 Empl. Prac. Dec. P 40,709 Ali DAEMI, Plaintiff-Appellant, v. CHURCH'S FRIED CHICKEN, INC., Defendant-Appellee.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1379

931 F.2d 1379

59 Fair Empl.Prac.Cas. 395,

56 Empl. Prac. Dec. P 40,709

Ali DAEMI, Plaintiff-Appellant, v. CHURCH'S FRIED CHICKEN, INC., Defendant-Appellee.

No. 86-1584.

United States Court of Appeals Tenth Circuit.

April 23, 1991.

R.V. Funk, Judd James, Tulsa, Okl., for plaintiff-appellant.

Timothy E. McCormick, Tulsa, Okl., for defendant-appellee.

Before HOLLOWAY, Chief Judge, and SETH and ANDERSON, Circuit Judges.

HOLLOWAY, Chief Judge.

Plaintiff-appellant Daemi, a non-white person of Iranian descent, commenced this action against Church's Fried Chicken, Inc. (CFC) under 42 U.S.C. Sec. 1981 and Title VII of the Civil Rights Act of 1964, 42 U.S.C. Sec. 2000e et seq., alleging that CFC discriminated against him on the basis of race and national origin. Daemi also asserted pendent state-law claims for intentional infliction of emotional distress, breach of contract, and wrongful termination. Following a bench trial, the district court entered judgment against Daemi on all of his claims and he appeals.

I

There is record evidence to show the following:

Daemi started working for CFC in June 1980 and, with the exception of a six-month period in 1981, continued working for CFC until his resignation in June 1983. CFC is a fast-food restaurant chain, specializing in Daemi first became an area manager in November 1981 in CFC's Central Illinois area. Approximately seven months later, he accepted the area manager position in Tulsa. The district manager for the Tulsa area (Daemi's supervisor) was Glen Huffman. Huffman treated his subordinates harshly and openly admitted that he did not like blacks or Iranians. On several occasions, he made derogatory comments about CFC employees, including Daemi, based on their race or national origin. Specifically, he called Daemi a "damn Irish" or "damn Iranian." Further, Huffman indicated that he wished to have "clean, whitefaced American[s]" in CFC positions in the Tulsa market. Huffman threatened Daemi with loss of his job if he did not terminate or otherwise eliminate his Iranian subordinates. Huffman's conduct disturbed Daemi, who felt that Huffman treated him like "dirt." In October 1982, Huffman was discharged by CFC for certain financial misconduct unrelated to his discriminatory practices. ² His position was filled the following month by Robert Vines.

                fried chicken.  When Daemi started working for CFC, the relationship between the company and its employees was defined in part by certain manuals and handbooks. 1   Daemi was initially employed part-time as an hourly-wage employee in Joplin, Missouri.  Shortly thereafter, he entered CFC's management program and advanced to the position of assistant manager in Joplin.  In October 1980, Daemi moved to Tulsa, Oklahoma, where he took a position as senior manager.  Daemi occupied that position for roughly six months, at which time he resigned and sought employment in the engineering field.  He rejoined CFC in June 1981 as a senior manager in Joplin
                

Vines was regarded as a tough manager. He had a direct, aggressive manner which occasionally created tensions with his subordinates. Vines, however, was also generally regarded as fair. Daemi did not interact well with Vines. Daemi believed that Vines treated him poorly due to his race and national origin. Vines allegedly addressed Daemi in blunt language (sometimes in front of his subordinates), and was not receptive to Daemi's work-related ideas and concerns. Vines made Daemi feel ignorant and worthless. His conduct also allegedly caused Daemi to experience stress-related stomach disorders. Unlike Huffman, however, Vines did not hurl ethnic or racial slurs at Daemi or other CFC employees.

According to Daemi, Vines did direct him to eliminate Iranian employees in the Tulsa market. Further, Vines allegedly belittled and otherwise mistreated Daemi at CFC seminars. For example, at a seminar held in Oklahoma City in June 1983, Vines did not recognize Daemi for his work as an area manager. The seminar was in fact designed to recognize store managers who had attained the coveted CFC title of Master Merchant. ³ However, Daemi thought that some area managers were recognized for their job performance and felt deeply embarrassed and hurt by Vines' failure to recognize him.

Vines also required Daemi to take a polygraph test on one occasion. While Daemi Vines was not pleased with Daemi's performance as Tulsa area manager. He did not doubt that Daemi worked hard. Daemi was in constant contact with the stores in his area. Often, when visiting a store, he would don a uniform and spend long hours behind the counter serving customers. Moreover, while Daemi was Tulsa area manager, three stores attained Master Merchant status--the first stores ever to do so in the Tulsa area.

                was on vacation, two stores in his area were robbed of approximately $15,000.  Vines undertook an investigation of the robberies and learned from CFC employees that a rumor was spreading that Daemi was involved.  Vines' suspicions were aroused.  He informed Daemi of the rumor and asked him to take a polygraph examination to "clear the air."    Vines told Daemi that it was important in his position as area manager that he be responsible and an example to his subordinates.  Vines had dealt with similar robbery cases involving whites where he did not ask the area managers to take polygraph examinations, but allegedly in those cases the area managers had not been identified by other employees as possible suspects.  Daemi agreed to take the polygraph test, and he passed.  Yet, he viewed Vines' instigation of the test as another instance of abusive treatment based on his race and national origin
                

However, Vines believed that Daemi did not "work smart." According to Vines, area managers were generally not supposed to physically work in the stores. Rather, their principal function was to hire and train personnel. Vines found Daemi's performance of this function to be inadequate. Vines observed that there was considerable turnover of personnel in Daemi's stores, creating a manpower shortage, and Daemi was having difficulties hiring an adequate number of new employees to keep the stores fully staffed. On one occasion, Vines personally assisted Daemi in hiring employees, but the manpower problems persisted. Further, Vines noted that there were repeated cash shortages at several of Daemi's stores, in combined amounts ranging from $50 to $200 per day. Often, he also found that Daemi's stores were unclean.

Vines orally counseled Daemi regarding his performance deficiencies, but observed little improvement. Eventually, Vines asked his superior Ed Marlette to come to Tulsa to speak with Daemi about his performance. Marlette did so in the spring of 1983. In a meeting attended by Vines, Daemi promised Marlette that he would try to do better. Daemi did try, but Vines found the results to be lacking.

Accordingly, Vines gave Daemi the option of either accepting a demotion to store manager or quitting. Vines explained to Daemi that the demotion would in no way foreclose his future advancement in CFC and that it might be a good move for him because as a store manager Daemi would have more time to spend with his family. Vines told Daemi that with the aid of Marlette he would attempt to set up a special pay plan that would ensure that Daemi lost no income due to the demotion. The demotion proposal shocked and disturbed Daemi. At that time, however, he did not assert that it was unjust or discriminatory. Subject to receiving the store of his choice, No. 827, he accepted the demotion.

Yet, as structured by Vines and Marlette, the special pay plan was troubling to Daemi. While it was allegedly designed to benefit him, the pay plan was conditioned on Daemi meeting certain performance criteria. He had to receive satisfactory evaluations from his immediate supervisor, and, more importantly, he had to make Master Merchant within 120 days. Daemi was troubled by the evaluation requirement because he believed that at least in the short term Vines would be his immediate supervisor. Also, Daemi perceived the task of making Master Merchant within 120 days to be extremely difficult, if not impossible. ⁴ None of the white area managers demoted by Vines during roughly the same period Daemi apparently did not voice any objections regarding the special pay plan to Marlette, when Marlette discussed it with him, and the demotion was finalized. After working only two days in his new position, Daemi resigned. In his resignation letter, delivered to Vines, Daemi complained of his "unjust demotion." He subsequently filed a timely charge with the Equal Employment Opportunity Commission (EEOC). In his charge, Daemi alleged that CFC discriminated against him due to his national origin in violation of Title VII.

as Daemi were subject to the 120-day Master Merchant requirement.

In his complaint Daemi asserted five claims against CFC, two under federal law and three under state law. Specifically, on the federal side, Daemi sought back pay and reinstatement under Title VII for alleged national origin discrimination, and compensatory and punitive damages under 42 U.S.C. Sec. 1981 for alleged racial discrimination. On the state side, Daemi sought money damages from CFC for alleged intentional infliction of emotional distress (IIED), breach of contract, and wrongful discharge. The district court chose to exercise pendent jurisdiction over these state-law claims.

II

Following the trial to the court, the district judge made findings and conclusions generally as follows:

Daemi filed a charge of discrimination on the basis of national origin with the EEOC and later received a right-to-sue letter, following which Daemi timely brought this action. During the eleven months that Daemi worked with his first district manager, Huffman, Huffman spoke derogatory words about Daemi and others but did not take any discriminatory actions against Daemi nor cause any...