Appeals court overturns $366 million FedEx race bias verdict

By Jonathan Stempel

(Reuters) -A federal appeals court on Thursday threw out a $366.2 million verdict against FedEx, in a case brought by a Black sales manager who said the package delivery company fired her in retaliation for accusing her supervisor of race discrimination.

The 5th U.S. Circuit Court of Appeals said the plaintiff, Jennifer Harris, was entitled to none of the $365 million of punitive damages that a Houston jury awarded her in October 2022.

It also reduced Harris’ damages for pain and suffering, mental anguish and inconvenience to $248,620 from $1.16 million, despite finding sufficient evidence to support her retaliation claim.

FedEx said in a statement that it remains confident that it acted properly regarding the termination of Harris’ employment and is pleased with the court’s decision to reduce the damages.

Harris’ lawyers did not immediately respond to requests for comment.

The award against Memphis, Tennessee-based FedEx had been among the largest in a U.S. workplace bias or retaliation case involving a single worker.

Harris had worked for FedEx for more than 12 years, first as a sales representative and ultimately as a district sales manager, before being fired in January 2020.

She said her firing stemmed from her complaints about her supervisor, a white woman, who had given her a poor performance review and who Harris alleged had tried to demote her.

But the New Orleans-based appeals court said Harris did not meet the “heavy burden” under Title VII of the Civil Rights Act of 1964 of showing that FedEx acted with malice or reckless indifference toward her, in the face of a “perceived risk” that its actions would violate federal law.

Circuit Judge Cory Wilson said the evidence suggested that the supervisor believed Harris should be disciplined for insubordination, not in retaliation for her complaints.

“For punitive damages, it is the employer’s subjective intent that matters,” Wilson wrote for a three-judge panel.

The case is Harris v. FedEx Corporate Services Inc, 5th U.S. Circuit Court of Appeals, No. 23-20035.

(Reporting by Jonathan Stempel in New York; Additional reporting by Nilutpal Timsina; Editing by Stephen Coates and Christopher Cushing)