Waffle House, Inc. v. Williams

• Citation: 313 S.W.3d 796
• Decision Date: 11 June 2010
• Docket Number: No. 07-0205.,07-0205.
• Parties: WAFFLE HOUSE, INC., Petitioner, v. Cathie WILLIAMS, Respondent.
• Court: Supreme Court of Texas

313 S.W.3d 796

WAFFLE HOUSE, INC., Petitioner, v. Cathie WILLIAMS, Respondent.

No. 07-0205.

Supreme Court of Texas.

Argued March 12, 2009.

Decided June 11, 2010.

COPYRIGHT MATERIAL OMITTED

W. Wendell Hall, Fullbright & Jaworski L.L.P., San Antonio, TX, Mark Thomas Emery, Fullbright & Jaworski L.L.P., Washington, DC, Ralph H. Duggins, Cantey & Hanger, L.L.P., Thomas S. Brandon Jr., Whitaker Chalk Swindle & Sawyer, LLP, Lynn Waller Kelly, Fort Worth, TX, for Petitioner.

Susan E. Hutchison, S. Rafe Foreman, Kern A. Lewis, Foreman, Lewis & Hutchison, P.C., Grapevine, TX, for Respondent.

Mark R. Flora, Constangy Brooks & Smith, LLC, Austin, TX, for Amicus Curiae National Council of Chain Restaurants.

Justice WILLETT delivered the opinion of the Court, in which Chief Justice JEFFERSON, Justice HECHT, Justice WAINWRIGHT, Justice GREEN, Justice JOHNSON, and Justice GUZMAN joined.

After being sexually harassed by a coworker, Cathie Williams sued her employer, Waffle House, Inc. for (1) sexual harassment under the Texas Commission on Human Rights Act (TCHRA),¹ and (2) common-law negligent supervision and retention. The jury found for Williams on both claims, and she elected to recover on the common-law claim, which afforded a far greater monetary recovery.

This case poses several issues, including this one of first impression: may a plaintiff recover negligence damages for harassment covered by the TCHRA? Our view is that the TCHRA, the Legislature's specific and tailored anti-harassment remedy, is preemptive when the complained-of negligence is entwined with the complained-of harassment. Here, the alleged negligence is rooted in facts inseparable from those underlying the alleged harassment. We do not believe the Legislature's comprehensive remedial scheme allows aggrieved employees to proceed on dual tracks—one statutory and one common-law, with inconsistent procedures, standards, elements, defenses, and remedies.

A statutory remedy is not always the sole remedy, and the TCHRA does not foreclose an assault-based negligence claim arising from independent facts unrelated to sexual harassment. Harassment need not be physical, and assault need not be sexual. Nor does today's decision bar a tort claim against the harasser/assailant individually. But here, as Williams admits, her two claims against Waffle House stem from the same boorish and objectionable conduct. Where the gravamen of a plaintiff's case is sexual discrimination that lies at the heart of the TCHRA, allowing negligence damages for a TCHRA violation would eclipse the Legislature's prescribed scheme. There is one more reason the TCHRA in this case should be exclusive, not cumulative: an employer's supervision and retention duties are embedded in the broader TCHRA inquiry, which hinges liability in part on whether the employer takes prompt remedial action to halt the harassment.

As there is no common-law tort for sexual harassment in Texas, we reverse the court of appeals' judgment and remand to that court to reach the issues pertinent to Williams' TCHRA claim.

I. Factual and Procedural Background

Williams was a Waffle House waitress from July 2001 to February 2002. Within her first week on the job, she was subjected to offensive sexual comments from Eddie Davis, a cook. Davis sometimes made the comments with his hands in his pants. He would wink at Williams, which she described as unwelcome flirting. Once, after his shift was over, Davis showed Williams a condom and laughed. He often stared at her.

On several occasions, as Williams walked by Davis, he pushed her into counters and into the grill. Once, while Williams was helping customers, Davis came up behind her, held her arms with his body pressed against her, and said, "Isn't she great, isn't she wonderful?" Davis cornered her on several other occasions. When she would reach up to put plates away, Davis would rub against her breasts with his arm. Once, when Williams was in a supply room, Davis, smirking, stood in front of her and blocked her exit. She had to duck under his arm to leave.

Williams complained to store manager Ossie Ajene several times, but the harassment continued. Williams claimed Ajene laughed when she first complained, while Ajene testified that he first heard of Davis' harassment of Williams from another employee, Bobbie Griffith. Ajene talked to Davis, who denied the allegations. Ajene moved Davis to another shift that immediately preceded the shift Williams and Davis had shared. Company policy requires that managers report complaints of harassment by calling a hotline. Ajene never called the hotline. He told Williams he preferred to handle the situation in-house.

After the shift change, Davis' and Williams' shifts occasionally overlapped. Davis would also often stay at the restaurant after his shift ended, to eat or pick up his paycheck. Because complaints to Ajene had not stopped the harassment, Williams complained to district manager T.J. Marshall. Marshall spoke to Davis, who again denied wrongdoing. Waffle House has a sexual-harassment policy that includes notice to employees of the hotline that allows them to make complaints of discrimination or harassment directly to corporate management. Marshall told Williams to call the hotline. Williams told Marshall she had tried but was having trouble getting through. Marshall then called the hotline for Williams. There was conflicting evidence as to whether he accidentally dialed the workers' compensation hotline or the correct hotline, but regardless no action was take by corporate management as a result of the call.

Williams also complained to Kevin Love, who replaced Ajene as store manager in December 2001. Love told Davis sexual harassment would not be tolerated, and he asked employee Griffith to report any future incidents she witnessed involving Davis and Williams.

District manager Allen Conley replaced Marshall in January 2002. Conley asked Williams to write a letter documenting her claims, which she did in February 2002. Conley did not remember exactly what he did with the letter but claimed he "processed it to somebody." Williams tried to give the letter to Love, but he initially would not accept it. Conley reported the harassment complaint to division manager Kevin Ross. No one in Waffle House corporate management got back to Williams.

Williams quit in February 2002, and claims she was constructively discharged. She filed complaints with the federal Equal Employment Opportunity Commission (EEOC) and the Texas Commission on Human Rights. Both agencies issued right-to-sue notices, in January 2003 and March 2003.

In April 2003, Williams sued Davis and Waffle House in state court, alleging sexual harassment under the TCHRA and common-law battery by Davis. She also asserted a common-law claim against Waffle House for negligent supervision and retention of Davis. Williams nonsuited Davis, and the case proceeded to trial.

On the TCHRA claim, the jury was asked whether Williams was sexually harassed under a hostile-work-environment theory (Question 1), whether Williams was constructively discharged (Question 2), whether the discharge occurred as a result of official action (Question 3), and whether Waffle House was excused under a statutory affirmative defense (Question 4). The jury, in a 10-2 verdict, answered these questions in Williams' favor, but rejected a statutory retaliation claim.

On the common-law claim for negligent supervision and retention, Williams accepts in her briefing that "there is a requirement of a separate, legally compensable tort" committed by coworker Davis. The court of appeals likewise agreed that an element of a claim for negligent supervision and retention is that "the employee committed an actionable tort."² Williams contends the underlying tort was not sexual harassment, as there is no common-law tort of sexual harassment,³ but assault. The jury was asked whether Davis assaulted Williams (Question 6), and utilized the definition of simple assault under the Penal Code, which provides that an assault occurs if a person "intentionally or knowingly causes physical contact with another when the person knows or should reasonably believe that the other will regard the contact as offensive or provocative."⁴ The jury found an assault by Davis, but in Question 7 refused to find that Waffle House ratified the assault.⁵

The jury, instructed on "negligence," "ordinary care," and "proximate cause" in Question 8, found that Waffle House was negligent in supervising or retaining Davis, or both, and that the negligence proximately caused damage to Williams.

The jury was asked a single question (Question 9) covering compensatory damages under the common-law and statutory claims. It found past compensatory damages, consisting of "emotional pain and suffering, inconvenience, mental anguish, loss of enjoyment of life, and other noneconomic losses," in the amount of $400,000. It found future compensatory damages of $25,000. After making additional findings of malice or reckless indifference, it awarded punitive damages of $3.46 million.

Williams elected to recover under her common-law claim. The trial court entered a judgment of $425,000 in past and future compensatory damages, $425,000 in punitive damages,⁶ interest, and costs. Waffle House filed post-verdict motions, including a motion for new trial on grounds of newly discovered evidence and other grounds. The trial court denied the motions. The court of appeals affirmed the judgment,⁷ and Waffle House appealed to this Court.

II. Preemption of the Common-Law Claim

Waffle House contends, in addition to other arguments we do not reach, that Williams' negligent supervision and retention claim should fail as a matter of law because the TCHRA is the exclusive remedy for workplace sexual harassment in this case. We agree.

A. Preservation of Error

Williams argues that Waffle House did not preserve the exclusive-remedy argument in the courts below....