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Leonal Anthony Garcia-Garcia v. Costco Wholesale Croporation
United States Court of Appeals for the First Circuit for the First Circuit
Case Number: 17-1014
Court: United States Court of Appeals for the First Circuit on appeal from the District of Puerto Rico
Plaintiff's Attorney: Jose G. Fagot Diaz and Manuel E. Lopez-Fernandez
Defendant's Attorney: Vincente J. Antonetti and Javier G. Vázquez-Segarra,
Description: After approximately eleven
years of working his way up the Costco1 employment ladder,
appellant Leonal Anthony Garcia-Garcia2 (Garcia) was fired
following an investigation which revealed an inventory discrepancy
in the Meat Department that he managed. Garcia sued Costco in
federal court invoking diversity jurisdiction and alleging an
array of Puerto-Rico-based claims stemming from his discharge.3
The district court granted summary judgment in favor of Costco on
all counts and Garcia appealed to this Court. We briefly summarize
Garcia's employment history before we delve into the inventory
snafu which ultimately led to his dismissal. In doing so, we view
the evidence in the light most favorable to Garcia and draw all
reasonable inferences in his favor. See Del Valle-Santana v.
Servicios Legales De Puerto Rico, Inc., 804 F.3d 127, 128 (1st
In 2002, Garcia began working at Costco store #365
located in Caguas, Puerto Rico, as a meat wrapper in the store's
1 Cover bears defendant's full corporate name.
2 Garcia's wife, Karelis Echevarría-Cruz, and their conjugal
partnership are also named plaintiffs and their claims are
derivative. See Medina-Rivera v. MVM, Inc., 713 F.3d 132, 134
(1st Cir. 2013).
3 The claims against co-defendant National Union Fire
Insurance Company of Pittsburgh, Costco's liability insurer, were
dismissed per joint motion.
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Meat Department. Throughout his tenure at Costco, Garcia
continuously received positive performance evaluations and
promotions. In 2006, he was elevated to meat cutter, and then in
2011, to meat manager. As part of his responsibilities as manager,
Garcia was tasked with conducting inventory of all goods within
the Meat Department. Although meat inventory was not Garcia's
sole responsibility, it was nevertheless his "primary" one.
Fast forward to October 28, 2013. Steve Stoddard, a
Regional Meat Manager at Costco, noticed, while reviewing the
Costco meat inventory, that "the ending inventory of $297,000
represented a meat inventory much higher than the actual inventory
[Costco] store #365 [could] physically accommodate in the store at
any given time."4 Thereafter, David Soto, then Costco-store-#365's
manager, along with his assistant manager, Rocío Mendez, and Garcia
were tasked with conducting a full accounting of the Meat
Department's stock. What they found was an ending inventory of
$315,000. Given this high ending tally, a manual count of the
meat cases was performed, which resulted in a discrepancy of
$114,000 in missing product.
Following up, on November 4, 2013, Nayreth Ríos,
Internal Auditor at Costco store #365, along with Rocío Mendez and
Garcia, performed a second manual inventory count, which resulted
4 All dollar amounts included in this decision are approximate
figures rounded to the nearest thousand.
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in an ending value of $178,000. When handed the result, Stoddard
compared the audited manual inventory count with the ending
inventory of the previous period and concluded that "the inventory
discrepancy was due to a hidden shrink5 of approximately $146,000."
A broader review of the inventory entries revealed that, on the
27th, 28th and 29th of October 2013, manual entries of
approximately $114,000 in product were made into the system (known
as AS400). At that time, "it was determined that . . . Costco's
inventory of the Meat Department for store #365 had been erratic
for over nine . . . monthly periods."
Thomas Farano, a Loss Prevention/Regional Manager at
Costco, conducted interviews to get to the bottom of the product
discrepancy. While speaking with Garcia, Farano, along with Jose
Mendez, Costco's Loss Prevention Manager, and Frank Chiriboga,
Costco's Regional Meat Manager, accused Garcia of stealing and
altering the inventory numbers "to cover up the theft."6 According
[Garcia] denied any knowledge or involvement in entering
the additional inventory into the AS400. [Garcia]
indicated that other people had his pass word [sic] and
he did not make any fraudulent entries to increase his
inventory levels. He also could not offer any
5 Shrinkage is the reduction in or loss of inventory due to
factors such as theft, vendor fraud, breakage, or waste. See
Shrinkage, Black's Law Dictionary (10th ed. 2014); Rando v.
Leonard, 826 F.3d 553, 554 (1st Cir. 2016).
6 Nayreth Rios, Inventory Auditor, was also separately
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explanations to what could have happened which would
have impacted the inventory numbers.
Jeremy Dempsey, Vice President of Operations at Costco,
also interviewed Garcia and accused him of "manipulating inventory
and stealing products." When grilled, Garcia once again was
"unable to explain why his inventories were high and erratic over
the past nine . . . periods." Garcia reiterated that he had not
stolen any merchandise and that, in fact, he believed all the
merchandise had been accounted for. On three occasions, Garcia
also grieved to Dempsey, Soto, and Farano about the accusations
being made against him and complained about (what he characterized
as) Costco's "gender-based disparate treatment," which he said was
causing him emotional distress and anxiety. According to Garcia,
Costco had treated similarly situated female employees, including
Beatriz Gomez, Rocío Mendez, and Johanne Oquendo, differently than
him; when they engaged in similar alleged conduct (i.e., stealing
or allowing theft under their watch), they were not disciplined
and were actually later promoted.
Seven days later, on November 29, 2013, Costco gave
Garcia the boot. According to Garcia, Soto delivered the discharge
news, and while doing so, apologized to Garcia and admitted Costco
had no evidence that "pointed to Garcia as having committed any
wrongdoing." Approximately two months later, Garcia sent a letter
to Joe Portera, Costco's Executive Vice President, asking Costco
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to reconsider its decision to terminate his employment. In the
letter, Garcia pointed out that other younger employees, "both
male and female," who had been involved in "similar situations"
had been allowed to continue working at Costco. He professed,
once again, that he did not steal from Costco and urged Portera to
reconsider his termination. Garcia's request was denied and his
employment was never reinstated.
The following year, Garcia, represented by counsel, sued
Costco in federal court pursuant to 28 U.S.C. § 1332 alleging
multiple violations of Puerto Rico law: (1) gender-based disparate
treatment and retaliation, Law 100, P.R. Laws Ann. tit. 29 § 146;
(2) sex discrimination and retaliation, Law 69, P.R. Laws Ann.
tit. 29 § 1321; (3) libel and defamation, P.R. Laws Ann. tit. 32
§§ 3141-3149; (4) violation of Sections 1, 8, and 16 of Article II
of the Puerto Rico Constitution; (5) wrongful discharge, Law 80,
P.R. Laws Ann. tit. 29 § 185b; and (6) violation of Puerto Rico's
Civil Code, Art. 1802. His complaint sought compensatory damages
and reinstatement. Costco filed an answer to the suit denying all
wrongdoings alleged in the complaint and retorting that Garcia was
dismissed "with just cause . . . after the investigation regarding
the inventory discrepancy showed that he was responsible for the
grossly negligent mishandling of company records and serious
misconduct and incompetence in the performance of his job."
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Following discovery, Costco filed a motion for summary
judgment maintaining that the "present case poses no genuine issues
of material fact and as a matter of law the instant [c]omplaint
should be dismissed." In support of its motion, Costco filed three
affidavits from Costco agents Stoddard, Farano, and Dempsey.
Garcia objected to the motion on several grounds, including that
Costco had failed to meet its burden of establishing that his
termination was based on good cause.7 Garcia also objected to the
admission of the three affidavits asserting they were not notarized
and, according to Garcia, "all fail to represent[,] . . . assert[,]
and/or mention in the specific document that each declarant has
personal knowledge of the facts they pretend to assert."
Additionally, Garcia claimed, without any discussion, that "the
documents attached as exhibits to the [affidavits] are not
authentic" and should not be admitted. The judge disagreed and
admitted the affidavits8 after concluding that Stoddard "declared
7 He also argued that: (1) a jury could infer he had shown
pretext (relating to his gender discrimination claim); (2) he
demonstrated a strong causal connection between his protected
conduct and his termination (relating to his retaliation claim);
(3) Costco lost its conditional privilege to communicate matters
regarding the workplace (relating to his defamation claim); and
(4) his constitutional claim should still stand even if his
defamation claim failed.
8 It is unclear whether the judge ruled on the admission of
the Farano and Dempsey affidavits. Because there is nothing to
suggest these affidavits were excluded and Garcia treats them as
having been admitted, we will do the same for purposes of this
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events based on his personal knowledge." She also declined to
entertain Garcia's "boiler-plate objection" that the exhibits had
not been properly authenticated. As to the merits of Garcia's
wrongful discharge claim, the district court found the following
facts to be undisputed and thus dispositive: (1) Garcia was in
charge of keeping inventory of the Meat Department; (2) Costco
conducted an extensive investigation into the inventory
discrepancy; and (3) Garcia was unable to account for such a
discrepancy. The district court also found no merit to Garcia's
remaining claims and granted summary judgment on all counts.9
Garcia appealed to this Court.
STANDARD OF REVIEW
"We review the entry of summary judgment de novo."
Echevarría v. AstraZeneca Pharm. LP, 856 F.3d 119, 126 (1st Cir.
2017). A grant of summary judgment is appropriate when "there is
no genuine dispute as to any material fact and the movant is
entitled to judgment as a matter of law." Ameen v. Amphenol
Printed Circuits, Inc., 777 F.3d 63, 68 (1st Cir. 2015). "A
genuine issue of fact exists where 'the evidence is such that a
reasonable jury could return a verdict for the nonmoving party.'"
Taylor v. Am. Chemistry Council, 576 F.3d 16, 24 (1st Cir. 2009)
(quoting Chadwick v. WellPoint, Inc., 561 F.3d 38, 43 (1st Cir.
9 We will discuss the lower court decision in greater detail
as it becomes pertinent to our analysis.
- 9 -
2009)). The court must examine "the record in the light most
favorable to the nonmovant" and must make "all reasonable
inferences in that party's favor." Ameen, 777 F.3d at 68 (quoting
Barclays Bank PLC v. Poynter, 710 F.3d 16, 19 (1st Cir. 2013)).
"While we resolve all reasonable inferences in favor of the nonmoving
party, we 'must ignore conclusory allegations, improbable
inferences, and unsupported speculation.'" Taylor, 576 F.3d at 24
(quoting Am. Steel Erectors, Inc. v. Local Union No. 7, Int'l Ass'n
of Bridge, Structural, Ornamental & Reinforcing Iron Workers, 536
F.3d 68, 75 (1st Cir. 2008)).
Moreover, when the district court's ruling is dependent
in part on preliminary evidentiary rulings, we "review the district
court's evidentiary rulings made as part of its decision on summary
judgment for abuse of discretion." Hoffman v. Applicators Sales
and Serv., Inc., 439 F.3d 9, 13 (1st Cir. 2006) (citing Alternative
Sys. Concepts, Inc. v. Synopsys, Inc., 374 F.3d 23, 31 (1st Cir.
On appeal, Garcia raises with us the same arguments he
made below regarding the admission of the affidavits and the
exhibits attached thereto--that neither should have been
considered because they were not in compliance with Rule 56(c)(4)
of the Federal Rules of Civil Procedure. Additionally, Garcia
continues to challenge the judge's summary-judgment ruling on the
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merits of each of his six claims against Costco. We begin with a
discussion of the affidavits before examining whether each count
of Garcia's complaint warranted summary disposition.10
A. Admission of Affidavits
Rule 56(c)(4) provides that "[a]n affidavit or
declaration used to support or oppose a motion must be made on
personal knowledge, set out facts that would be admissible in
evidence, and show that the affiant or declarant is competent to
testify on the matters stated." "[T]he requisite personal
knowledge must concern facts as opposed to conclusions,
assumptions, or surmise." Perez v. Volvo Car Corp., 247 F.3d 303,
316 (1st Cir. 2001).
Before this Court, Garcia once again maintains that
Costco's supporting affidavits were not in compliance with Rule 56
for two reasons: (1) because the affiants did not declare that
they have personal knowledge regarding the matters stated therein;
and (2) because the inventory exhibits attached to the affidavits
were not authenticated by the affiants. We are not persuaded the
judge abused her discretion.
10 We pause to note that although every heading (including the
table of contents) of Costco's brief states that the district court
erred in entering summary judgment, the body of the brief prays we
affirm that entry.
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Garcia maintains the judge erred by not striking the
affidavits of Stoddard, Farano, and Dempsey from the record.
According to Garcia: the three affidavits "reveal that the
affiants did not declare that they have personal knowledge of the
purported facts set forth in each of their declarations" and,
"[f]or such reason and because the affiants did not declare how
they would be competent to testify on those matters raised in the
[affidavits] at trial, the [district court] erred in not striking
these from the record as they are inadmissible in evidence."11
(Emphasis in the original). Notably, although Garcia summarily
and generally asserts that the affiants lacked personal knowledge
about the matters being sworn to, the argument he actually develops
on appeal is much more narrow and technical--he argues that the
affiants' mere failure to specifically declare within the
affidavits themselves that they did have personal knowledge
suffices to make the affidavits inadmissible.
11 In his brief, Garcia quotes cases explaining the previous
Federal Rule of Civil Procedure 56(e), which required the records
submitted with affidavits to be certified (although he makes no
argument relating to certification). This rule was amended in
2010; while no change was made to the summary-judgment standard
itself, or to the burdens imposed on movants and opponents,
"authentication" is no longer required under the rule. Rule 56.
Summary Judgment, 10A Fed. Prac. & Proc. Civ. CIV Rule 56 (4th
- 12 -
First we note that Rule 56 contains no requirement that
the affiant specifically articulate that he or she has personal
knowledge. See Fed. R. Civ. P. 56(c). Therefore, Garcia's focus
on this narrow argument, which is unsupported by the plain language
of the applicable rule, is quite odd. Further, a reading of the
affidavits demonstrates that all three affiants did have personal
knowledge about the facts they were swearing to, despite not
explicitly stating so. See Barthelemy v. Air Lines Pilots Ass'n,
897 F.2d 999, 1018 (9th Cir. 1990) (internal citation omitted)
("That Rule 56's requirements of personal knowledge and
competence to testify have been met may be inferred from the
affidavits themselves."). For instance, Stoddard specifically
states in his affidavit that he was the Costco agent who noticed
the high inventory number of approximately $297,000 for store #365
and later "determined that the inventory discrepancy was due to a
hidden shrink of approximately $146,000[.]" Similarly, Farano
attested that he had been instructed to investigate the inventory
discrepancy, and as part of doing so, interviewed Garcia, along
with Mendez and Chiriboga. Farano also attached two emails as
exhibits to his affidavit whereby he provides a synopsis of the
interviews he conducted as part of the investigation. Finally,
Dempsey notes that Stoddard informed him of the high-ending
inventory, and that on November 13, 2013, he too "interviewed
Garcia regarding the inventory discrepancy." It is readily
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apparent, and easily inferred, that these statements were made
with personal knowledge.
But, to the extent the affiants make broader statements
about the inventory investigation without making their knowledge
readily clear, those statements are either undisputed or are not
specifically challenged by Garcia. Again, we note he does not
contest the accuracy or veracity of any specific statement within
Accordingly, we find no abuse of discretion in the lower
court's decision to admit the affidavits. See Vélez v. Thermo
King de Puerto Rico, Inc., 585 F.3d 441, 445 n.1 (1st Cir. 2009)
(no abuse of discretion in admitting employer affidavit to show
what motivated employee's firing because "the relevant question in
th[at] case [was] not whether [the employer] was correct that [the
employee] had violated rules, but whether that perceived violation
was the reason it fired him").
As to the exhibits attached to the affidavits, Garcia
maintains that they were not authenticated by the affiants or
certified under oath and therefore, should have been excluded. We
disagree. As noted, the district court never reached the merits
of this contention because Garcia's argument was merely
boilerplate--it characterized the exhibits as lacking
authentication without noting any specifics. While Garcia
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attempts to resurrect this argument on appeal by adding in a bit
more bite (he gets more specific and argues the exhibits are
"illegible and unsigned"), his attempt is futile. See McCoy v.
Massachusetts Inst. of Tech., 950 F.2d 13, 22 (1st Cir. 1991) ("It
is hornbook law that theories not raised squarely in the district
court cannot be surfaced for the first time on appeal.")
Importantly, Garcia does not challenge the district court's
finding that his argument regarding the exhibits was mere
boilerplate. Accordingly, "[w]e reject, as procedurally
defaulted," Garcia's arguments relating to the authenticity of the
exhibits. See id.
Seeing no abuse of discretion, we proceed first to
address Garcia's wrongful discharge challenge and then take up his
gender-based discrimination and defamation claims.
B. Wrongful Discharge (Law 80)
Garcia's wrongful discharge claim is based on a Puerto
Rico statute, colloquially known as "Law 80," which provides a
remedy to employees who are discharged "without just cause." P.R.
Laws Ann. tit. 29, § 185a; see also Echevarría, 856 F.3d at 140.
Law 80 provides that "[a] discharge made by the mere whim of the
employer or without cause relative to the proper and normal
operation of the establishment shall not be considered as a
discharge for good cause." Id. § 185b(f). On the other hand, the
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statute specifies that the following constitute examples of goodcause
"the worker indulges in a pattern of improper or disorderly
conduct[;]" Id. § 185b(a).
the employee's failure to perform his or her work "in an
efficient manner, or . . . doing it belatedly and
negligently or in violation of" quality standards; Id. §
"repeated violations of the reasonable rules and
regulations established" by the employer, if a written copy
has been duly furnished to the employee. Id. § 185b(c).12
The following burden-shifting framework is applicable to
Law 80 claims: "(1) the employee must [first] show that he or she
has been discharged and allege that the dismissal was not
justified; (2) the burden then shifts to the employer to show, by
a preponderance of the evidence, that the dismissal was justified;
and (3) if the employer shoulders that burden, the employee must
rebut the showing of good cause." Echevarría, 856 F.3d at 140.
In the present case, our de novo review demonstrates
that Garcia easily overcomes the first hurdle--it is undisputed
12 The statute also specifies three other good-cause grounds
for termination "that relate to company restructuring or
downsizing." Carrasquillo-Ortiz v. Am. Airlines, Inc., 812 F.3d
195, 196 (1st Cir. 2016); see also P.R. Laws Ann. tit. 29, §
- 16 -
that he was discharged from his employment with Costco and he
alleges in his complaint that such discharge was not justified.
The burden now shifts to Costco to show by a
preponderance of the evidence that Garcia's discharge was based on
good cause. See id. To meet the good-cause prong, Costco "need
only demonstrate that it had a reasonable basis to believe that
[Garcia] has engaged in one of those actions that the law
identified as establishing such cause." Id. (quoting Pérez v.
Horizon Lines, Inc., 804 F.3d 1, 9 (1st Cir. 2015)). In fact,
even a "perceived violation [would] suffice to establish that
[the employer] did not terminate [the employee] on a whim, but
rather for a sensible business-related reason." Hoyos v. Telecorp
Commc'ns, Inc., 488 F.3d 1, 10 (1st Cir. 2007) (emphasis added).
The termination need only be "non-arbitrary" and bear "some
relationship to the business' operation." Pérez, 804 F.3d at 9.
Costco cites Garcia's inability to account for the
$146,000 in missing meat product as the cause of his termination.
As noted, Garcia, as meat manager, had inventory oversight of the
Meat Department. He himself admitted at his deposition that
ensuring that the reported inventory figures comported with the
physical inventory in the Meat Department was his "primary
responsibility"; despite this, under his supervision, the meat
inventory was inflated for a total of nine monthly periods. When
Costco agents inquired about the discrepancy, Garcia was unable to
- 17 -
explain or justify the numbers. At best, the record shows that
Garcia wasn't satisfactorily performing his primary job
responsibility. Given this backdrop, we believe the evidence
presented by Costco would compel a reasonable jury to conclude
that Costco has met its good-cause burden and that its decision to
dismiss Garcia was not made on a whim.13 See Hoyos, 488 F.3d at
10. Therefore, Costco has shouldered its burden of proving by a
preponderance of the evidence that Garcia's employment was
terminated for good cause. See Pérez, 804 F.3d at 10 ("Although
[employee] has shown that he was discharged, a reasonable jury
could only conclude that [employer] ha[d] met its burden of showing
"Because [Costco] established cause for [Garcia's]
termination, to withstand summary judgment [Garcia] bore the
burden to rebut that showing." Id. To satisfy his burden, Garcia
was required to do more than "cast doubt" on Costco's proffered
reason for his discharge; instead, Garcia had to "adduce probative
evidence that [Costco] did not genuinely believe in or did not in
fact terminate [Garcia] for the reason given." Id. at 11 (citing
Dea v. Look, 810 F.2d 12, 15 (1st Cir. 1987)).
13 The district court ended its analysis here, but Law 80
framework requires us to consider whether Garcia has presented any
evidence to rebut Costco's good-cause showing. See Echevarría,
856 F.3d at 140.
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The following three themes can be distilled from
Garcia's brief (with a lot of effort on our part) as addressing
why he believes he has rebutted Costco's good-cause showing: (1)
he had an excellent employment record at Costco; (2) no inventory
discrepancy actually existed; and (3) even if one did exist, Costco
failed to prove he was the one responsible.14 We address and reject
each of these arguments in turn.
1. Employment History
Garcia maintains that as to his "purported job
incompetence and just cause for dismissal," he presented evidence
that he had a great employment history with Costco, highlighting
that "during the same year of his termination, (2013) he was
favorably evaluated and received a salary increase." He also cites
to his history of frequent promotions, high ratings on quality
inspections, and high monthly average sales to rebut Costco's goodcause
While evidence of overall positive employment reviews
may be used to establish pretext when an employee is later
14 Garcia's brief does not clearly present these arguments
within prong 3 of the Law 80 burden-shifting framework (where he
is tasked with rebutting Costco's proffered reason for discharging
him). Instead, he conflates prongs 2 and 3--sometimes arguing
Costco has not met its burden (implying prong 2), while at other
times arguing that the proffered reason given by Costco for his
dismissal was pretextual (implying prong 3). Because Garcia's
arguments all appear to challenge Costco's proffered reason, we
think they best address the third prong. We note that his
arguments fail irrespective of what prong we tie them to.
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terminated for poor performance, see Acevedo-Parrilla v. Novartis
Ex-Lax, Inc., 696 F.3d 128, 140-43 (1st Cir. 2012), Costco has
never suggested that it was anything but pleased with Garcia's
work performance before his elevation to Meat Department manager.
Indeed, in 2010 Costco had named Garcia employee of the month.
However, Costco need not establish a continuous pattern of poor
behavior to satisfy the good-cause prong; instead, one instance
can suffice. See Hoyos, 488 F.3d at 6 ("Although Law 80 generally
refers to multiple episodes of misconduct as constituting good
cause, 'Law 80 does not invariably require repeated violations,
particularly where an initial offense is so serious, or so reflects
upon the employee's character, that the employer reasonably should
not be expected to await further occurrences.'") (quoting Gonzalez
v. El Dia, Inc., 304 F.3d 63, 75 (1st Cir. 2002)). Undeniably,
Costco's proffered reason--a costly and unexplained $146,000
inventory discrepancy within the department Garcia managed--is so
severe that Costco could not have been "expected to await further
occurrences." See id. Therefore, Garcia's first attempt to rebut
Costco's good-cause showing fails.15
15 To the extent Garcia argues there are "genuine issues over
material facts" regarding his stellar employment record, these
facts are by no means material to this case. Whether Garcia had
a great (or a terrible) employment history with Costco prior to
the inventory discrepancy does not really matter because Costco
relies on the inventory discrepancy (and nothing else) to satisfy
its good-cause prong.
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2. Existence of Inventory Discrepancy
Next, Garcia argues that there was no actual inventory
discrepancy as all the products that Costco agents claimed were
missing were, in fact, "physically there and part of the
inventory." According to Garcia, when he specifically asked to
see the list of "missing items," Costco was unable to provide him
with one.16 Garcia maintains that the apparent inventory
discrepancy could easily be explained: Costco agents compared a
partial inventory (of just beef and pork resulting in a low
$160,000 figure)17 with the inventory reported for the entire meat
department. In other words, there appeared to be a discrepancy
because they did not compare the same products.
Garcia's attempt to undermine Costco's evidence of
hidden shrinkage fails. Stoddard's affidavit, including the
inventories and emails attached thereto, show that the "partial
inventory" of pork and beef Garcia refers to was in fact compared
to a manual inventory conducted for the same meat items. Here's
what the record shows: Stoddard was surprised by the reported
inventory of $297,000 and requested that Soto perform another
16 Garcia does not point to anything in the record indicating
he requested this information during discovery.
17 Although Garcia notes a $160,000 amount for the pork and
beef inventory, the record suggests this figure was actually
$118,000. Regardless, the exact amount is not material to the
issues on appeal.
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inventory; after the results were still high ($315,000), Stoddard
requested a manual recount of the entire Meat Department ($178,000)
and, specifically, the results for "pork and meat."18 Stoddard
then compared the results of the manual recount sent by Soto to
reported inventories for seven specific "pork and meat" items.
The $114,000 discrepancy found was the result of a comparison
between what was reported and what was physically present for these
seven meat items.19 Thus, Garcia's argument that the apparent
discrepancy is based on an inherently flawed analysis is not
supported by the record.
3. Other Employees
Lastly, Garcia faults Costco for failing to meet
"its burden of demonstrating without any doubt" that he is the
person who actually engaged in the alleged theft and/or inventory
manipulation. Other employees, including managers and auditors,
had his password, says Garcia, and could have accessed and entered
false inventory figures into AS400. Once again, we are not
18 Because "meat" would include the entire department, it is
likely that he meant "pork and beef."
19 The hidden shrink later rose to $146,000 when the entire
physical meat inventory of $178,000 was compared to the reported
ending inventory for the previous period of $297,000. A worksheet
attached to Stoddard's affidavit includes the calculations made to
reach the amount of $146,000 in hidden shrink.
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For starters, Garcia clearly has the standard wrong;
Costco need not "demonstrate without any doubt" that Garcia
manipulated the numbers. Instead, it must show by a preponderance
of the evidence that it had good cause to terminate Garcia. See
P.R. Laws Ann. tit. 29, § 185b. As noted, even a "perceived
violation" is sufficient to rebut an allegation that the decision
to dismiss an employee was made on a whim. See Hoyos, 488 F.3d at
10. Here, Garcia as manager was primarily responsible for the
meat tabulation; whether or not he was the one guilty of any theft
or of manipulating the inventory numbers is immaterial. Being
terminated from his post for failing to adequately perform his
primary responsibility of ensuring that the accounting was
accurate bore a direct "relationship to the business' operation."
See Pérez, 804 F.3d at 9. Therefore, Garcia has failed (once
again) to rebut Costco's good-cause showing.
Accordingly, because a reasonable jury would be
compelled to find that Costco has met its burden of proving just
cause and that Garcia has failed to rebut such showing, the
district court correctly granted summary judgment on the Law 80
claim.20 Id. at 8.
20 Garcia also argues that Costco's alleged violation of its
own internal accounting procedures by not having a member of the
warehouse management staff sign the inventory (and then later using
that inventory to establish that Garcia's discharge was justified)
demonstrates that the reasons given for his termination were
pretextual. We fail to see any plausible link between an inventory
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C. Gender Discrimination (Law 100 and Law 69)
In addition to his wrongful discharge claim, Garcia
alleges that he was discriminated against in violation of Law 100,
P.R. Laws Ann. tit. 29 § 146, and Law 69, P.R. Laws Ann. tit. 29
§ 1321. These statutes prohibit gender and sex-based
discrimination in the workforce. See id. "Indeed, Law 69 is
merely an amplification of the principles contained in Law 100."
Rodriguez-Torres v. Caribbean Forms Manufacturers, Inc., 399 F.3d
52, 61 (1st Cir. 2005). Law 100's burden-shifting framework
provides that: (1) the employee must first show that his or her
discharge was not for just cause21--if successful, the employee
enjoys a presumption that he or she has been the victim of
discrimination; (2) the burden of production and persuasion then
shifts to the employer to rebut this presumption. Ramos v. Davis
that was not signed, and Garcia's argument that somehow this
demonstrates pretext. Garcia's argument, as this Court understands
it, completely lacks merit and is rejected.
Moreover, Garcia indicates that several other male Costco
employees had stolen merchandise at Costco but were nevertheless
allowed to continue their employment. Because Garcia does not
develop any specific argument as to how this fact rebuts Costco's
good-cause showing, it is deemed waived. See Mills v. U.S. Bank,
NA, 753 F.3d 47, 54 (1st Cir. 2014) (treating as waived "embryonic
21 "'[T]he Supreme Court of the Commonwealth of Puerto Rico
determined that, because Law 100 did not define the term 'just
cause,' the term's definition would be drawn from an analogous
statute--' Law 80." Alvarez-Fonseca v. Pepsi Cola of Puerto Rico
Bottling Co., 152 F.3d 17, 28 (1st Cir. 1998).
- 24 -
& Geck, Inc., 167 F.3d 727, 734 (1st Cir. 1999). Here, because
Costco made the showing that it had just cause to dismiss Garcia
in the Law 80 context, it follows that "the Law 100 presumption
[of discrimination] disappears." Alvarez-Fonseca v. Pepsi Cola of
Puerto Rico Bottling Co., 152 F.3d 17, 28 (1st Cir. 1998) (citing
P.R. Laws Ann. tit. 29, § 148). Therefore, Garcia bears "the
burden of proof on the ultimate issue of discrimination," meaning
that he "must prove that, even if the dismissal was justified,
[Costco] nevertheless violated Law 100 because the dismissal was
motivated by discriminatory animus instead of or in addition to
the legitimate reasons for dismissal." Id. In other words, that
the reasons proffered were pretextual.22 See Pérez, 804 F.3d at 8
n.4 ("[The Law 100] framework follows the Law 80 burden shifting
framework" and because "no reasonable jury could conclude that
[the employer] lacked cause to terminate [the employee,] . . . to
succeed on his Law 100 claim [the employee] must show that [the
22 The district court, after noting that Law 100's presumption
of discrimination "was not triggered" because Costco had met its
burden of showing that the dismissal was justified, concluded that
"the burden shifting analysis ends here." The judge nevertheless
provided an analysis "assuming that the presumption of
discrimination was triggered," and found that Garcia would in any
event lose. (Emphasis added). We pause to note that even where
the presumption is not triggered, as was the case here, the
analysis does not end there. Instead, as noted, the result is
that the employee bears "the burden of proof on the ultimate issue
of discrimination." See Alvarez-Fonseca, 152 F.3d at 28.
- 25 -
employer's] proffered reason was pretext specifically designed to
mask gender discrimination.").
One method of showing that an employer's stated reasons
are pretextual "is to produce evidence that the plaintiff was
treated differently than other similarly situated employees."
Kosereis v. Rhode Island, 331 F.3d 207, 214 (1st Cir. 2003)
(citations omitted). While the "examples of disparate treatment
'need not be perfect replicas, . . . they must closely resemble
one another in respect to relevant facts and circumstances.'" Id.
(quoting Conward v. Cambridge Sch. Comm., 171 F.3d 12, 20 (1st
Cir. 1999)). In other words, when comparing the plaintiff's
experience to that of other employees, "apples should be compared
to apples." Woodward v. Emulex Corp., 714 F.3d 632, 639 (1st Cir.
2013) (quoting Dartmouth Review v. Dartmouth Coll., 889 F.2d 13,
19 (1st Cir. 1989)).
After reviewing the record, we conclude that Garcia's
gender discrimination claims under "Law 100 fail because he has
not 'proffered sufficient admissible evidence, if believed, to
prove by a preponderance of the evidence . . . that the employer's
justification . . . was merely a pretext for impermissible [gender]
discrimination.'" See Velázquez-Fernández v. NCE Foods, Inc., 476
F.3d 6, 11 (1st Cir. 2007) (quoting Woodman v. Haemonetics Corp.,
51 F.3d 1087, 1092 (1st. Cir. 1995) (ellipses in original)). In
support of his pretext argument, he claims "similarly situated
- 26 -
female employees" were treated differently and cites several
examples of employee wrongdoings that went unpunished.23
First, Garcia notes that three female employees,
including Beatriz Gomez, Rocío Mendez, and Johanne Oquendo, were
allowed to continue their employment at Costco after they admitted
to authorizing a $95,000 purchase which was later discovered to be
fraudulent. Garcia suggests that the monetary amount involved in
this incident alone should have been enough to terminate these
employees. Even assuming that the employees implicated in the
incident were "similarly situated" because of the monetary value
of the fraud, a crucial fact, which Garcia acknowledged at
deposition but omitted from his brief, is that this incident also
involved two male employees who like their female colleagues were
not terminated. See Mariani-Colón v. Dep't of Homeland Sec. ex
rel. Chertoff, 511 F.3d 216, 222 (1st Cir. 2007).
To have a plausible differential treatment claim, Garcia
was required to first show that employees of the opposite sex were
similarly situated and that he "was treated differently and then
that gender was the reason for that difference." Rivas Rosado v.
Radio Shack, Inc., 312 F.3d 532, 534 (1st Cir. 2002) (citations
omitted). Given that male employees were also involved, this fraud
23 The examples he cites throughout his brief, however, also involve
male employees, are overly broad, do not involve employees
"similarly situated," or encompass some combination of these fatal
- 27 -
incident does little to support Garcia's allegation that he was
treated differently than female employees, let alone "that gender
was the reason for that difference." Id. Even when viewed in the
light most favorable to him, an example involving unpunished male
and female employees does not support a finding that he was
discriminated against based on his gender.
Second, Garcia maintains that Johanne Oquendo and Rocío
Mendez were involved in some sort of "issue with the use and
payment of the chemicals," but were allowed to continue working at
Costco.24 Garcia also cites to an incident where Rocío Mendez
failed to follow managerial procedure after she observed another
employee improperly use Garcia's password to access AS400. We can
easily dispose of both examples as Garcia fails to explain exactly
how these women were "similarly situated" to him--he provides no
detail and no support other than his subjective belief that he was
being discriminated against by Costco. See Mariani-Colón, 511
F.3d at 222 (summary judgment affirmed in favor of employer in
employee's Title VII discrimination claim because employee's
"statements merely reflect [his] 'subjective speculation and
suspicion' that he was treated unfairly") (quoting Quinones v.
Buick, 436 F.3d 284, 290 (1st Cir. 2006)). His general statements
24 The district court did not consider this allegation as it held
it was not sufficiently supported by the record.
- 28 -
that are not properly supported by the record fail to carry the
Prior to the inventory discrepancies and Garcia's
termination, Garcia had been repeatedly promoted by Costco and
"[t]here were no statements or behaviors by [Costco agents]
involved in terminating [Garcia] from which an inference of
discrimination could be drawn." See Rivas Rosado, 312 F.3d at
534. The evidence presented at summary judgment would not permit
a reasonable jury to find that Garcia had carried his burden of
proof on the ultimate issue of discrimination. After taking a
fresh look ourselves, we conclude that the district court did not
err in dismissing with prejudice Garcia's gender discrimination
D. Retaliation (Law 69)
Moving along, Garcia alleges that his discharge was an
act of retaliation after he complained to Costco agents that he
was being treated differently than his female co-workers--recall
he told Dempsey, Soto, and Farano during the inventory
investigation that Beatriz Gomez, Rocío Mendez, and Johanne
Oquendo were not disciplined after engaging in similar alleged
misconduct. Law 69, P.R. Laws Ann. tit. 29 § 1340, contains a
retaliation provision that mirrors one of its federal law
counterparts under Title VII. The statute provides, in relevant
part, that: "[i]t shall be an unfair labor practice for an employer
- 29 -
. . . to dismiss or discriminate against any employee or
participant who files a complaint or charge, or is opposed to
discriminatory practices. . . ." P.R. Laws Ann. tit. 29 § 1340.
To prove a claim of retaliation, Garcia must first establish a
prima facie case, including that (1) he engaged in protected
conduct; (2) he experienced an adverse employment action; and (3)
there was a causal connection between the protected conduct and
the adverse employment action. Calero-Cerezo v. U.S. Dep't of
Justice, 355 F.3d 6, 25 (1st Cir. 2004). "[I]nformal protests of
discriminatory employment practices, including making complaints
to management, writing critical letters to customers, protesting
against discrimination by industry or by society in general, and
expressing support of co-workers who have filed formal changes,"
are instances of protected conduct. Planadeball v. Wyndham
Vacation Resorts, Inc., 793 F.3d 169, 175 (1st Cir. 2015).
Garcia maintains that "the facts demonstrate that prior
to his unlawful termination, [he] grieved of gender based disparate
treatment" by Costco and that the temporal proximity--being fired
just seven days after he last grieved--may alone create the causal
connection "between the firing and the activity because it is
strongly suggestive of retaliation." See Collazo v. Bristol-Myers
Squibb Mfg., Inc., 617 F.3d 39, 49 (1st Cir. 2010) ("[O]ur law is
that temporal proximity alone can suffice to meet the relatively
light burden of establishing a prima facie case of retaliation.")
- 30 -
(quoting DeCaire v. Mukasey, 530 F.3d 1, 19 (1st Cir. 2008)).
Here, though, any probative force of the chronology is belied by
the fact that the allegation of discrimination itself only came in
response to Costco's accusation of a defalcation that was itself
the cause for the discharge that ensued. See Germanowski v.
Harris, 854 F.3d 68, 74-75 (1st Cir. 2017). For purposes of this
appeal, we will nevertheless assume without deciding that Garcia
has produced adequate evidence to establish a prima facie case.
See Straughn v. Delta Air Lines, Inc., 250 F.3d 23, 33 (1st Cir.
2001); see also Kouvchinov v. Parametric Tech. Corp., 537 F.3d 62,
67 (1st Cir. 2008) ("For simplicity's sake, we assume without
deciding that the plaintiff established a prima facie case
. . . .").
Taking it from there, the burden then shifts to Costco
to articulate a legitimate, non-retaliatory reason for its action.
See Collazo, 617 F.3d at 46 (citation omitted). Given Costco's
reason for discharging Garcia--the inventory discrepancy--as
discussed in detail above, Costco has met this burden. Having
been successful, "the burden shifts back to [the plaintiff] to
show that the proffered legitimate reason is in fact a pretext and
that the job action was the result of the defendant's retaliatory
animus." Id. (quoting Roman v. Potter, 604 F.3d 34, 39 (1st Cir.
- 31 -
Garcia has presented no evidence by which a reasonable
jury could conclude that Costco's proffered reason for terminating
him was mere pretext and that his termination "was the result of
the defendant's retaliatory animus." Id. (quoting Roman, 604 F.3d
at 39) (summary judgment for the employer inappropriate in
retaliation claim where employee had "submitted evidence from
which a reasonable jury could conclude that the purported company
reorganization was not the real reason for his termination"). The
only record evidence Garcia points to in support of his retaliation
claim is his own deposition statement wherein he states his belief
that he was "dismissed unjustifiably" and that Costco "took
reprisals" against him because he noted "that they had done nothing
against [other employees]." Garcia failed to present any evidence
to support these "conclusory allegations." See Vives v. Fajardo,
472 F.3d 19, 21 (1st Cir. 2007) ("Even in retaliation cases, where
elusive concepts such as motive or intent are at issue, summary
judgment is appropriate if the non-moving party rests merely upon
conclusory allegations, improbable inferences, and unsupported
speculation.") (internal quotation marks omitted). Having failed
to present "significant probative evidence tending to support
[his] [retaliation] claim[,]" we are satisfied that summary
judgment in favor of Costco on Garcia's retaliation claim was
appropriate. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
- 32 -
Garcia's final arguments address his defamation claims.
He contends the judge erred in dismissing his claims and in
concluding that Costco's communications to others were covered by
the qualified privilege of intra-business communications. In
Puerto Rico, "[t]he protection against defamatory or libelous
expressions has three sources." Giménez Álvarez v. Silen
Maldonado, 131 P.R. 91, 97 (1992). First, the Constitution of the
Commonwealth of Puerto Rico, Art. II, § 8; second, the Libel and
Slander Act, P.R. Laws Ann. tit. 32 §§ 3141-3149; and third, Civil
Code § 1802, P.R. Laws Ann. tit. 31 § 5141. Id. at 97-98 (citations
A defamation claim based on all three sources of Puerto
Rico law "requires that the plaintiff prove: (1) that the
information is false, (2) that plaintiff suffered real damages,
and (3) in the case of a private figure plaintiff, that the
publication was negligent.” Ayala-Gerena v. Bristol Myers-Squibb
Co., 95 F.3d 86, 98 (1st Cir. 1996) (quoting Mojica Escober v.
Roca, 926 F. Supp. 30, 33 (D.P.R. 1996)); see P.R. Laws Ann. tit.
32 §§ 3142-43. "[P]ublication" is an essential element of the
claim and can be met "when the defamatory statement is communicated
to a third person, that is, someone other than the person defamed."
Porto y Siurano v. Bentley P.R., Inc., 132 P.R. 331, 347-48 (1992).
- 33 -
In Porto y Siurano, the Supreme Court of Puerto Rico discussed the
publication element in the corporate context. Id. at 348.
As at issue here, communications within an organization
"among 'managers or supervisors of a discharged employee,
regarding the reasons for'" an employee's discharge are covered by
a conditional privilege. Soto-Lebrón v. Fed. Express Corp., 538
F.3d 45, 63 (1st Cir. 2008) (quoting Porto y Siurano, 132 P.R. at
353-54). Because the privilege is conditional, it is lost if the
employer abuses it by giving the statement "excessive publicity"
or by publishing it for "improper reasons." Id. The privilege
also vanishes if the publication is made to one whom there is no
reason to believe will protect the author's interest or the
community's. Porto y Siurano, 132 P.R. at 354.
Garcia argues that the district court twice erred, first
by ruling that Costco's publications were subject to privilege;
according to Garcia, Costco "abused its conditional . . . privilege
by publicizing defamatory statements to other [Costco] employees
who had no right to know about Garcia's termination of employment."
Second, Garcia argues that he "proffered evidence to prove malice,"
as the statements "were made with knowledge of falsity and reckless
disregard as to their truth."
We agree with the district court's conclusion that
Garcia's allegations in support of his defamation claims "are the
textbook definition of 'conclusory.'" As the district court noted,
- 34 -
all that Garcia put forth fell into three groups: "(1)
conversations that he sustained with his superiors as part of the
investigation into the inventory discrepancies;" "(2) alleged
information relayed . . . by . . . other Costco employees"
(including Garcia's father-in-law who worked at Costco); and "(3)
two emails sent by Jerry Dempsey to Yoram Robanenko and David Soto"
accusing Garcia of altering company documents.
As it relates to group one conversations--Garcia's
superiors accusing him "of negligence, lying, stealing
merchandise[,] and of manipulating inventory and its data[,]"--
clearly these communications are intra-business communications
covered by the qualified privilege. See Porto, 132 P.R. at 354-
55. Garcia has failed to present any evidence to support his
allegation that the privilege was lost due to "excessive
publication" or that any publication was made for "improper
reasons." See Soto-Lebrón, 538 F.3d at 63. As the nonmoving party
at the summary judgment stage, Garcia was tasked with providing
more than mere allegations; he was required to "set forth specific
facts showing that there [were] genuine issue[s] for trial."
Anderson, 477 U.S. at 248 (quoting Fed. R. Civ. P. 56). Garcia
has failed to meet his burden.25 Furthermore, even if the
25 In granting summary judgment the district court expressed
that "other than his own averments, [Garcia] has not shown that
the statements in question damaged his reputation or honor." We
pause to note, however, that to the extent the statements are that
- 35 -
conditional privilege had been lost, Garcia cannot meet the
publication element required because these accusations were
communicated to him, not to third parties. See Porto y Siurano,
132 P.R. at 347.
Moreover, as it relates to the remaining groups two and
three statements--those purportedly made by Costco managers to
employees, which eventually made their way to Garcia--we agree
with the district court that they "are based on nothing more than
hearsay and gossip, and, as such, do not provide a solid basis for
a defamation claim." Garcia presented no supporting affidavits or
deposition transcripts from the individuals who allegedly learned
these defamatory statements from Costco managers. The deposition
transcript of Israel Echevarría-Nieves (Garcia's father-in-law),
which accompanied Garcia's objection to Costco's motion for
summary judgment, does not provide any support for Garcia's
allegations. Echevarría-Nieves (like we mentioned earlier), an
Garcia is a thief, he would not be required to establish harm.
See González Pérez v. Gómez Aguila, 312 F. Supp. 2d 161, 174
(D.P.R. 2004) (citing Pérez–Rosado v. El Vocero de Puerto Rico,
149 P.R. 427 (1999)) ("[T]he Puerto Rico Supreme Court has held
that publications in which the commission of a crime is imputed
are considered libelous per se.").
- 36 -
employee at a separate Costco store, noted that his manager, Rafael
Reyes, asked him what he thought had occurred at store #365 but
that he didn't have an answer for him. According to Echevarría-
Nieves, his manager said that prices were inflated and that numbers
did not match, and that Garcia "had no reasoning or answer to
that;" "that it appeared that it was either they had stolen the
merchandise or they had inflated the inventories." When
specifically asked whether Reyes had told him that Garcia had
stolen the merchandise, Echevarría-Nieves responded: "No.
[Reyes] just said that he didn't understand how something like
that could've happened." Not only is this statement hearsay, even
if it were admitted and accepted, it readably does not support
Garcia's claims. See United States v. $8,440,190.00 in U.S.
Currency, 719 F.3d 49, 61 (1st Cir. 2013) ("[I]t 'is black-letter
law that hearsay evidence cannot be considered on summary judgment
for the truth of the matter asserted[.]'") (quoting Kenney v.
Floyd, 700 F.3d 604, 609 (1st Cir. 2012)).
Accordingly, even viewing the evidence in the light most
favorable to Garcia, he has completely failed to present any
triable issue relating to his defamation claims to survive summary
judgment. Accordingly, we affirm the entry of summary judgment in
favor of Costco.26
26 Garcia also claims that the district court erred by not
separately addressing his constitutional causes of action. While
* * *
Garcia attempts to characterize his constitutional claim as an
independent claim, what he alleges--that his "dignity was
transgressed and utterly violated resulting from Costco's
continuous badgering and hostile working environment in calling
him a thief and a liar"--sounds like defamation. "[M]erely
relabeling [his] arguments does nothing to advance them." Coors
Brewing Co. v. Méndez-Torres, 678 F.3d 15, 27 (1st Cir. 2012);
see Brown v. Hearst Corp., 54 F.3d 21, 27 (1st Cir. 1995)
(restatement of a defamation claim as a "false light" privacy claim
merited no independent discussion). Moreover, Garcia does not
specify in his constitutional argument exactly who made the
statements and to whom the statements were made. On top of that,
in his filing to the district court, and again in his brief to us,
Garcia quotes a Puerto Rico Supreme Court case, Garcia Benavente
v. Aljoma Lumber, 2004 T.S.P.R. 125 (2004), in support of his
argument that his constitutional claim should stand even though
his defamation claim failed, but Garcia "has not provided a
translation as required by this court's rules." Hoyos, 488 F.3d
1, 6 (citing 1st Cir. Loc. R. 30[e]). As such, "the case may not
be used to support his position." Id. (citing López-González v.
Mun. of Comerío, 404 F.3d 548, 552-53 n.4 (1st Cir. 2005)). For
all these reasons, we affirm summary judgment in favor of Costco
on Garcia's constitutional claims. We also reject Garcia's
argument that Costco has waived any defense regarding his