Court Affirms Jury Verdict Against Costco for Customer Sexual Harassment Toward Employee

A federal Court of Appeals has affirmed a jury verdict in favor of a former Costco employee in connection with her claim of a hostile work environment based upon sexual harassment by a customer.  This case reaffirms that an employer can be held legally responsible for allowing a hostile work environment created by non-employees if the conduct is severe or pervasive enough to render the employee’s work environment hostile.

In the matter of EEOC v. Costco Wholesale Corp., the EEOC sued on behalf of a former Costco employee, Dawn Suppo.  Ms. Suppo was initially employed as a seasonal, part-time employee in 2009 and then became a regular, part-time employee in May, 2010.  Around the time she became a regular employee, a customer named Thad Thompson began approaching Ms. Suppo and asking her personal questions that her uncomfortable.  Initially, Ms. Suppo did not report the interactions to her supervisor or other management.  However, in or about July/August, 2010, the conduct did not stop and Ms. Suppo informed her supervisor of Mr. Thompson’s harassing conduct and the fact that she was scared of him.  Her supervisor instructed her to notify him if she sees Mr. Thompson again.

Soon thereafter, Ms. Suppo noticed Mr. Thompson in the store again watching her through the store aisles. Ms. Suppo reported to her supervisor that Mr. Thompson was back in the store stalking her and that she was scared of him.  As a result, Ms. Suppo’s supervisor and other management brought Mr. Thompson into the warehouse office and instructed him to leave Ms. Suppo alone.  Mr. Thompson responded with anger and loudly yelled that it is a “free country” and that he had “freedom of speech.”  Ms. Suppo was extremely scared at this point and decided to call the police and file a report.  Later that day, the one of the Costco Assistant Managers yelled at Ms. Suppo for calling the police and instructed her to be nice to Mr. Thompson.

While it is disputed how many times Mr. Thompson and Ms. Suppo had interactions after filing the police report, the evidence at trial showed Mr. Thompson was at the Costco store at least 20 times based upon his membership purchase records.  The interactions continued to include Mr. Thompson watching Ms. Suppo in the aisles and asking her Suppo personal questions, some in a sexual way or tone.  Mr. Thompson also told Ms. Suppo that he thought she was pretty, beautiful and exotic.  Mr. Thompson also made some physical contact with Ms. Suppo including using his shopping cart to bump into her, touching her face under her eye, touching her wrist, and attempting to hug her on two different occasions.

Eventually, Ms. Suppo asked if she could park closer to the store’s entrance to avoid having to be in the parking lot alone, which was denied by Costco. Costco’s denial of this request resulted in Ms. Suppo having her father pick her up from work.

On September 8, 2011, Ms. Suppo obtained a Stalking No Contact Order against Mr. Thompson that prohibited him from approaching Ms. Suppo at her residence or place of work for 21 days.  On September 11, 2011, Ms. Suppo went on a medical leave of absence  from Costco.  Costco thereafter conducted an investigation in connection with Ms. Suppo’s claims of sexual harassment. Although Costco could not confirm a violation of the anti-harassment policy, they did instruct Mr. Thompson to not shop at the Costco location in which Ms. Suppo worked.  Ms. Suppo never returned to work from her medical and Costco terminated her employment in November, 2012.

On Ms. Suppo’s behalf, the employment lawyers at the EEOC filed suit against Costco alleging that it had discriminated against her because of her sex “by creating and tolerating a sexually hostile work environment.”  Ms. Suppo also alleged that she was constructively discharged from her employment, which claim was dismissed prior to trial.  Ultimately, the jury found in favor of Ms. Suppo on her sexual harassment claim and awarded her $250,000 in compensatory damages. The Court of Appeals affirmed the award.

This case serves as another important reminder to employers in the #metoo movement that they not only have a responsibility to stop sexual harassment from their own employees, but also those persons who are not employed by the company.  This includes clients, customers, independent contractors and other person.  In situations where companies are aware or should be aware of harassing or discrimination at the workplace, they maintain an affirmative obligation to stop and remedy the hostile work environment caused regardless of whether the harassment is caused by another employee or non-employee.