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Friday v. Magnifique Parfumes and Cosmetics, Inc.

United States District Court, N.D. Indiana, South Bend Division

July 11, 2019




         Michelle Friday managed a Perfumania store in a Michigan City, Indiana mall. She had previously suffered nerve damage in a car accident, which somewhat limited her use of her hands and caused them to be atrophied, though that condition did not prevent her from doing her job. Ms. Friday alleges that during an inventory count in January 2016, her boss first noticed her hands' appearance and remarked that they “are disgusting.” Several months later, he fired Ms. Friday, citing an excessive “shrink rate, ” or loss of inventory. Ms. Friday contends that this explanation was inaccurate and pretextual, and that the real reason was her boss' disapproval of the condition and appearance of her hands. In this suit, Ms. Friday claims that she was fired because of her disability and because she did not conform to her boss' expectations for how a woman should appear. Perfumania moves for summary judgment. For the reasons below, the Court denies the motion as to those claims, as Ms. Friday has offered evidence from which a reasonable jury could infer discrimination in those respects.


         Defendant Magnifique Parfumes and Cosmetics, Inc. operates retail stores under the name Perfumania. The stores sell perfumes and colognes, along with some other related items. Michelle Friday began working for Perfumania as an assistant store manager in 2011, and worked at a store in the Lighthouse Mall in Michigan City, Indiana. She was promoted to store manager in September 2013. Some years earlier, Ms. Friday had been in a car accident in which she suffered nerve damage. As a result, she had limited mobility in her wrists, she experienced atrophy in her hands, and her fingers did not all function correctly; Ms. Friday testified that between her two hands, she has five fingers that work well. This condition caused Ms. Friday to do some tasks differently, such as when she would spray a perfume bottle to provide a sample, but both parties agree that the condition did not prevent her from doing her job. Throughout Ms. Friday's employment, her store was supervised by Doug England, a district manager who oversaw about 20 stores.

         One of the metrics by which Perfumania measures the performance of its stores is their “shrink rate, ” which tracks the amount of product lost or stolen from the store. Perfumania measures the shrink rate by dividing the amount of missing inventory by the stores' total sales. The overall company goal is a shrink rate of 0.25% or less. If a store has a shrink rate of 0.10% or less, the store manager receives a bonus. If the store has a shrink rate of over 0.35%, it can be placed in the “target store program, ” during which inventory is counted more frequently and employees are required to take action to improve the shrink rate. Employees' commissions can also be reduced when the store is on target status.

         To measure the shrink rate, each store conducts a full inventory count around January of each year. During those counts, the employees use handheld scanners and scan the barcode of every product in the store, shelf by shelf. To verify all products were scanned, employees also count and manually input the number of products on each shelf, which have to match the number of products scanned from that shelf. Certain products also have to be scanned twice, by two different employees. Throughout the year, stores also conduct “cycle counts, ” during which the corporate office would send a list of products, which the stores then count manually. Those counts were conducted about once a month, as a spot-check, but the official shrink rate numbers were based on the annual inventories, which included all of the products in the store.

         The store at which Ms. Friday worked had a history of poor shrink rate numbers. The store had been on target status for several years before 2012, and the store manager who preceded Ms. Friday had received a written warning for having high shrink rates. The shrink rate for 2012 (based on an inventory taken in early 2013) was 0.30%, and cycle counts conducted in early 2013 came in well over 1%. Ms. Friday took over as store manager later in that year, and the total shrink rate for 2013 came in at 0.33%, a slight increase over the previous year. That was still below the number that would place the store on target status, but the store was placed on target status “for monitoring purposes only, ” meaning the employees' commissions were not reduced.

         In July 2014, a mid-year inventory count was conducted at Ms. Friday's store. The shrink rate came back as 0.7%. It came to light, though, that some products that had been moved off the sales floor and placed in a box in the back room had been omitted from the count. Thus, another inventory was conducted in October 2014 to account for those products. The store was placed on target status in the interim, but the employees' commissions were not cut, and the store was removed from target status after the new count. The year-end shrink rate for 2014 came in at 0.35%, again slightly higher than the previous year. Monthly cycle counts conducted throughout 2015 were good, though, with shrink rates generally below 0.1% and some reflecting no losses at all.

         The year-end inventory count for 2015 was conducted in January 2016. Ms. Friday and three other employees were present to conduct the count, and Mr. England also came to assist. Ms. Friday testified that Mr. England began looking at her “very strangely” while she was moving product around, as if he was looking at something gross. He asked Ms. Friday what was wrong with her, and she responded that she had been in a car accident and had a little nerve damage. Mr. England responded by saying that her hands “are disgusting.” Ms. Friday was offended and humiliated, but composed herself to finish the inventory.

         Ms. Friday believes that this was the first time Mr. England noticed her condition. He had never mentioned or asked her about her condition, which she usually tried to conceal. His questioning and reaction during their conversation during the inventory also led her to believe he had not noticed her hands before. But from that point forward, Ms. Friday perceived that Mr. England treated her different than before. He would not answer her emails promptly or communicate with her, even as to day-to-day tasks that she needed to do her job. And whereas Mr. England used to greet her with a hug when he would visit the store, he did not do so after. Ms. Friday also testified that Mr. England looked at her differently, as if she was an inferior person.

         In March 2016, the results came back for the 2015 inventory, and Ms. Friday's store had a shrink rate of 0.496%, a substantial increase over the previous year. After Mr. England sent her a list of each of the products reported missing from her store, Ms. Friday sent him an email raising multiple concerns with the accuracy of the results. She noted, for example, that some of the products reported missing were products that did not scan properly during the inventory count, for which they used substitute bar codes to scan. She also noted that other products that were reported missing had been sent back because they were shipped with improper bar codes, and that for various other items, the numbers reported missing were implausible. Mr. England never responded to Ms. Friday's email, though, or to the follow-up emails or calls in which she tried to raise the inaccuracies. Instead, Mr. England told Perfumania's human resources representative that he wished to fire Ms. Friday for the poor shrink rate. After drafting a corrective action form and receiving approval, Mr. England met with Ms. Friday on May 3, 2016, and informed her that she was being fired for her store's poor shrink rate.

         After filing a charge of discrimination with the Equal Employment Opportunity Commission, Ms. Friday filed this suit. Discovery has closed and Perfumania moved for summary judgment, and that motion is fully briefed.


         A court must grant summary judgment if the movant shows that there “is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). A “material” fact is one identified by the substantive law as affecting the outcome of the suit. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A “genuine issue” exists with respect to any material fact when “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. Where a factual record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial, and summary judgment should be granted. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986). In determining whether a genuine issue of material fact exists, courts must construe all facts in the light most favorable to the non-moving party and draw all reasonable and justifiable inferences in that party's favor. Jackson v. Kotter, 541 F.3d 688, 697 (7th Cir. 2008); King v. Preferred Tech. Grp., 166 F.3d 887, 890 (7th Cir. 1999). However, the non-moving party ...

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