Travis Schultz v. Dte Energy Corporate Services LLC ( 2018 )

STATE OF MICHIGAN
COURT OF APPEALS
TRAVIS SCHULTZ, UNPUBLISHED
September 20, 2018
Plaintiff-Appellant,
v No. 338196
Wayne Circuit Court
DTE ENERGY CORPORATE SERVICES LLC, LC No. 16-007386-CD
Defendant-Appellee.
Before: O’CONNELL, P.J., and CAVANAGH and SERVITTO, JJ.
PER CURIAM.
Plaintiff appeals as of right a circuit court order confirming an arbitration award in favor
of defendant, DTE Energy Corporate Services, LLC, in this action for race and age
discrimination.1 We affirm.
Plaintiff was employed by defendant as an assistant crew leader charged with supervising
a “move out crew,” which consisted of several crew members, a crew leader, and an assistant.
These crews performed work on residences, including installing new gas meters on the outside of
homes, installing plastic gas service lines from the meter to the main gas line at the street,
adjusting fuel lines in customer’s homes to match the new meters, and relighting pilot lights of
gas appliances. Defendant terminated plaintiff’s employment in June 2013 for failing to properly
supervise his crew members and for filling out “blue order” forms that did not accurately list the
work performed at each job site, including listing work that was never actually completed.
Plaintiff filed this action for wrongful termination, alleging claims of race and age discrimination
under the Michigan Civil Rights Act (CRA), MCL 37.2101 et seq. The parties agreed to submit
the claims to arbitration. After the parties presented their evidence, the arbitrator found that
defendant terminated plaintiff’s employment for legitimate business reasons, which were not a
pretext for discrimination. Plaintiff filed a complaint in circuit court to vacate the arbitration
award, and defendant filed a motion to confirm the award. The circuit court confirmed the
arbitrator’s award and dismissed plaintiff’s complaint.
1
The arbitrator found that plaintiff did not present any evidence of age discrimination. Plaintiff
does not challenge that decision. Thus, only the claim for race discrimination is at issue in this
appeal.
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Plaintiff argues on appeal that the circuit court should have vacated the arbitrator’s
decision because the arbitrator exceeded his powers by failing to follow the arbitration
agreement. We disagree.
A court’s power to modify, correct, or vacate an arbitration award is limited. An
arbitration award may be vacated if it was procured by corruption, fraud or undue means, was the
result of partiality or misconduct, or if the arbitrator exceeded his or her powers, or conducted
the hearing in violation of the requirements of the court rule. MCR 3.602(J)(2). When a party
claims that an arbitrator exceeded the scope of his authority or committed a material error of law,
“a reviewing court’s ability to review an award is restricted to cases in which an error of law
appears from the face of the award, or the terms of the contract of submission, or such
documentation as the parties agree will constitute the record.” Dohanyos v Detrex Corp (After
Remand), 217 Mich. App. 171, 175-176; 550 NW2d 608 (1996). Arbitrators exceed their powers
whenever they act beyond the material terms of the contract from which they primarily draw
their authority, or in contravention of controlling principles of law. Id. at 176, citing DAIIE v
Gavin, 416 Mich. 407, 444; 331 NW2d 418 (1982). In other words, “[t]he phrase ‘exceed his
powers’ is essentially longstanding shorthand for deviating from the contract or controlling law.”
Eppel v Eppel, 322 Mich. App. 562, 572; 912 NW2d 584 (2018). Moreover, “[t]he character or
seriousness of an error of law which will invite judicial action to vacate an arbitration award . . .
must be error so material or so substantial as to have governed the award, and but for which the
award would have been substantially otherwise.” DAIIE, 416 Mich. at 443. “Any such error
must be readily apparent on the face of the award without second-guessing the arbitrator’s
thought processes, and the arbitrator’s findings of fact are immune from review altogether.”
Eppel, 322 Mich. App. at 572; see also DAIIE, 416 Mich. at 429.
The record fails to support plaintiff’s argument that the arbitrator’s decision did not
comply with the parties’ agreement. In Michigan, arbitration awards “must be in writing and
contain findings of fact and conclusions of law.” Rembert v Ryan’s Family Steak Houses, Inc,
235 Mich. App. 118, 165; 596 NW2d 208 (1999). As the parties agree, the parties’ arbitration
agreement required that the arbitrator’s decision be in writing and include the findings and
conclusions on which the decision was based. In general, however, there are no specific
requirements regarding the scope of formal findings of fact or conclusions of law. See DAIIE,
416 Mich. at 429. Nor does the agreement itself specify the form of the arbitrator’s findings or
conclusions. Contrary to plaintiff’s argument, the parties’ agreement does not provide that the
arbitrator was required to refer specifically to “black letter” law in reaching his decision.
The arbitrator issued a nine-page written opinion that sets forth his findings of fact and
conclusions of law. The arbitrator’s opinion indicates that plaintiff’s race discrimination claim
was brought under the Michigan Civil Rights Act, and that plaintiff had the burden of proving
both that race was a reason for his termination, and that the legitimate business reasons for his
termination offered by defendant were a pretext for discrimination. The arbitrator also set out
the elements of a prima facie claim for discrimination when reviewing a claim based on
circumstantial evidence of race discrimination. The arbitrator thereafter summarized the
evidence presented by the parties and applied the relevant law to determine that plaintiff did not
show that he was treated differently than other similarly-situated Caucasian employees, that
defendant had provided valid non-discriminatory business reasons for plaintiff’s termination, and
that defendant’s stated reasons were not a pretext for discrimination. The arbitrator also rejected
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plaintiff’s claim that the evidence showed a pattern of race discrimination. The arbitrator’s
opinion satisfies the requirement that he issue a written decision setting forth his findings and
conclusions on which the decision is based.
Plaintiff next raises a number of related claims concerning whether the arbitrator
exceeded his authority by making material errors of law and ignoring controlling principles of
law. We find no merit to these arguments.
Plaintiff alleged that he was terminated because of his race. A plaintiff may prove
unlawful discrimination by direct or indirect evidence. Hazle v Ford Motor Co, 464 Mich. 456,
462; 628 NW2d 515 (2001). Direct evidence is “evidence which, if believed, requires the
conclusion that unlawful discrimination was at least a motivating factor in the employer’s
actions.” Id. (quotation marks and citation omitted). Examples of direct evidence sufficient to
advance a plaintiff’s case to a jury are racial slurs by a decision-maker. Harrison v Olde Fin
Corp, 225 Mich. App. 601, 610; 572 NW2d 679 (1997). Where a plaintiff cannot show direct
evidence of discrimination, the plaintiff must establish a prima facie case under the burden-
shifting analysis adopted from McDonnell Douglas Corp v Green, 411 U.S. 792; 93 S. Ct. 1817; 36
L. Ed. 2d 668 (1973). See Harrison, 225 Mich. App. at 607-608.
Under the McDonnell Douglas approach that Michigan has adopted in
various forms, the court must first determine if the plaintiff has stated a prima
facie case of discrimination. “Prima facie case” in the McDonnell Douglas
context means only that the plaintiff has provided enough evidence to create a
rebuttable presumption of discrimination. It does not mean that the plaintiff has
provided sufficient evidence to allow the case to go to a jury. If the court
concludes that the plaintiff has established a prima facie case of discrimination,
the court then examines whether the defendant has articulated a legitimate,
nondiscriminatory reason for its action. If that articulation is made, the court next
considers whether the plaintiff has proved by a preponderance of the evidence that
the reason offered by the defendant was a mere pretext for discrimination. [Id. at
607-608 (citations and footnotes omitted).]
To establish a prima facie case of intentional discrimination, a plaintiff must show that he was
(1) a member of a protected category, (2) subjected to an adverse employment action, (3)
qualified for the position, and (4) in this case, that he was discharged under circumstances that
give rise to an inference of unlawful discrimination. Hazel, 464 Mich. at 463; Lytle v Malady
(On Rehearing), 458 Mich. 153, 177 n 26; 579 NW2d 906 (1998). The latter factor may be
shown in a number of ways. Hecht v Nat’l Heritage Academies, Inc, 499 Mich. 586, 608; 886
NW2d 135 (2016). One of these is to demonstrate that the plaintiff was replaced by a person of
another race. See id. at 609. Another is to show that the plaintiff was treated unequally to a
similarly-situated employee who did not have the protected characteristic. Id. at 608. With
respect to the latter, “the ‘comparable’ employee[] must be ‘nearly identical’ to the plaintiff in all
relevant respects.” Id.
In this case, plaintiff did not point to any evidence of direct discrimination, such as a
racial slur by one of the decision-makers in his termination that would, if believed, require the
conclusion that unlawful discrimination was at least a motivating factor in defendant’s decision
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to discharge plaintiff. Therefore, the arbitrator should have, and did, review plaintiff’s claim
under the McDonnell Douglas framework. The arbitrator discussed plaintiff’s ability to support
his prima facie case, whether defendant provided a legitimate business reason to fire plaintiff,
and whether plaintiff could demonstrate that defendant’s proffered reason was a pretext for
discrimination.
Plaintiff argues that the arbitrator erred by impermissibly “mechanically applying the
shifting burden analysis” and did not tailor his analysis to the facts of the case. However,
because application of the burden-shifting framework is appropriate in cases of indirect
discrimination, plaintiff has not shown that the arbitrator made a material error of law in
applying it here. Moreover, it is evident from our review of the arbitrator’s opinion that, despite
the initial citation to the more general “treated differently than similarly situated employees”
form of establishing a prima facie case of discrimination, the arbitrator tailored his analysis to the
specific facts of the case and to the arguments raised by plaintiff concerning whether there was
actually a requirement to personally verify crewmembers’ work before submitting the blue order
forms and whether plaintiff was treated differently from other crew leaders outside of plaintiff’s
protected class who also did not personally check crewmembers’ work.
Plaintiff also maintains that the arbitrator failed to address whether defendant’s proffered
reason for termination, i.e., that plaintiff violated employer policy concerning inspecting and
verifying the work undertaken by various crewmembers, was a pretext for discrimination. He
further argues that the arbitrator failed to properly apply the law of pretext and did not perform a
legal analysis of the “selective enforcement” of defendant’s employment policy. Contrary to
plaintiff’s assertion, much of the arbitrator’s decision was dedicated both to whether defendant
had presented a legitimate business reason for firing plaintiff and whether this reason was a
pretext for discrimination. This, in turn, included a discussion of whether plaintiff had shown
selective enforcement. This claim of error is without merit.
Plaintiff also maintains that the arbitrator “impermissibly restricted plaintiff . . . to only
two avenues to prove his race discrimination case using circumstantial evidence as opposed to
direct evidence,” but does not explain this assertion. A party may not merely announce a
position and leave it to this Court to rationalize the party’s arguments. Peterson Novelties, Inc v
City of Berkley, 259 Mich. App. 1, 14; 672 NW2d 351 (2003). We note that the arbitrator focused
on the two theories that were specifically presented in plaintiff’s post-hearing brief. He cannot
now claim that the arbitrator erred by analyzing these theories in his opinion. See Grant v AAA
Mich/Wisconsin, Inc (On Remand), 272 Mich. App. 142, 148; 724 NW2d 498 (2006) (“A party
who expressly agrees with an issue in the trial court cannot then take a contrary position on
appeal.”). This argument is without merit.
Plaintiff also complains that the arbitrator did not analyze the testimony that he presented
concerning race discrimination that he allegedly experienced when he transferred to defendant’s
Coolidge location in 2012. However, plaintiff does not link this conduct to his termination, and
he does not present any legal authority outlining his position of what appears to be a claim of
pervasive discrimination at the workplace. Plaintiff has thus failed to meet the requirement that
he provide supporting authority for his position. See Peterson Novelties, Inc, 259 Mich. App. at
14.
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In summary, the record does not support plaintiff’s claim that the arbitrator exceeded his
powers by deviating from controlling law or by making a material error of law evident from the
face of the award.
Plaintiff also argues that the circuit court should have vacated the award because, had the
arbitrator properly applied controlling principles of employment discrimination law, he would
have determined that plaintiff had shown that he was subject to an adverse employment action
due to race discrimination. We reject this claim of error.
The questions presented in arbitration involved whether plaintiff was treated differently
than Caucasian crew leaders, and whether the reason for plaintiff’s firing was a pretext for
discrimination. Those questions were dependent on factual determinations concerning whether
defendant had an expectation that an assistant crew leader would inspect the work of his crew,
and whether plaintiff was responsible for ensuring that the information set out on the blue order
forms was correct. They also required consideration of whether plaintiff’s blue order forms were
“alarmingly inaccurate” and caused defendant to suffer significant and unusual losses, such that
plaintiff was not similarly situated to Caucasian crewmembers. Whether other named employees
had anything to do with plaintiff’s termination decision was also a factual question in the case.
After considering the parties’ competing evidence, the arbitrator ultimately determined that a
preponderance of the evidence showed that plaintiff’s employment with defendant was
terminated for poor work performance and conduct in improperly completing blue order forms.
The arbitrator found that the evidence did “not allow for a finding that race was a factor in the
decision to terminate [plaintiff’s] employment.” Plaintiff’s argument within this issue is based
on his application of the law to the facts as he sees them. He is essentially asking this Court to
accept his view of the facts in place of those of the arbitrator. “[T]he arbitrator’s findings of fact
are immune from review altogether.” Eppel, 322 Mich. App. at 572; see also DAIIE, 416 Mich. at
429. Given the arbitrator’s factual findings, the circuit court correctly found that plaintiff could
not support his claim of discrimination and that the award was proper.
Affirmed.
/s/ Peter D. O’Connell
/s/ Mark J. Cavanagh
/s/ Deborah A. Servitto
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