New York (CNN) — A jury ruled Monday in favor of former Starbucks regional director Shannon Phillips, who sued the company for unfairly firing her, arguing that they did so because she was white.
Phillips, who worked for Starbucks for about 13 years and ran a region of stores in the area, was fired after the arrest of two black men at a Philadelphia Starbucks in April 2018.
The New Jersey jury returned a verdict of $25.6 million, including $25 million in punitive damages and $600,000 in compensatory damages, according to Console Mattiacci Law, which represents Phillips. The jury found unanimously after a six-day trial, the lawyers said, noting that Phillips will also claim back and advance wages.
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Starbucks has expressed disappointment with the decision and is evaluating next steps, company spokeswoman Jaci Anderson told CNN.
This week’s verdict is the latest twist in an incident that sparked protests and outrage. In 2018, two men were asked to leave the cafeteria after sitting at a table without ordering. The men, who refused to leave because they were waiting for a business associate, were escorted out of the cafeteria in handcuffs after a store manager called police. They later reached settlement agreements with Starbucks and the City of Philadelphia.
In a lawsuit first filed in 2019, Phillips said the company discriminated against her because of her race when she was fired.
The 2019 lawsuit said that, following the arrest, Starbucks “took steps to punish white employees who were not involved in the arrests, but who worked in and around the city of Philadelphia, in an effort to convince the community that he had responded appropriately to the incident.”
Phillips, who at the time oversaw areas including Philadelphia, said Starbucks had ordered him to place a white employee on administrative leave as part of these efforts, due to alleged discriminatory conduct that Phillips said he knew to be inaccurate. After Phillips tried to defend the employee, the company fired her, he said.
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The reason for the dismissal, according to the complaint, was that “‘the situation is not recoverable'”. The lawsuit argued that this was “a pretext for racial profiling,” adding that Phillips’ “race was a motivating and/or determining factor in the discriminatory treatment [de Starbucks]”.
Starbucks, which denied the claims at the time, claimed in a 2021 court filing that, following the incident, “senior management and members of Associated Resources all noted that Ms. Phillips demonstrated a complete lack of leadership during this crisis.” .
Phillips, the company argued, “seemed overwhelmed and was unaware of how critical the situation had become.” Phillips’ supervisor ultimately decided to terminate her “because strong leadership was essential during that time,” according to the document.
A crisis for Starbucks
The 2018 incident was a major public relations crisis for the company. Following the arrests, Starbucks took several steps to try to remedy the situation.
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Then-CEO Kevin Johnson apologized, calling what happened “reprehensible” and vowing to make the necessary changes to make sure something like this doesn’t happen again.
Starbucks was quick to change its policy to allow people to use Starbucks restrooms and spend time in stores, even if they hadn’t made any purchases. The coffee shop chain also closed some 8,000 of its own stores for one afternoon to provide mandatory anti-bias training to some 175,000 employees.
— CNN’s Laura Ly and Zenebou Sylla contributed to this report.