Calvin Gresham v. Food Lion, Inc.

Calvin Gresham (Gresham) appeals the district court's grant of
summary judgment in favor of Food Lion, Incorporated (Food Lion)
on his claim alleging that Food Lion breached the terms of a settlement
agreement he entered into with Food Lion. We affirm.

I.

In October 1987, Gresham was hired by Food Lion as a store
detective in Food Lion's Loss Prevention Department. He held several
positions in the Loss Prevention Department until June 19, 1994,
when he became a loss prevention field agent working in Food Lion's
Southern Division, Region I, Middle Georgia District, which consisted
of twenty-four stores in the Augusta and Macon areas.1 As a
loss prevention field agent, Gresham was responsible for investigating
theft, losses, and food shortages in Food Lion stores.

In 1993, Gresham and another Loss Prevention Department
employee, Jerome Settles, who worked in and near the Columbia,
South Carolina area, complained to management that various decisions
relating to promotions, assignments, and discipline in the Loss
Prevention Department were improperly based on their race (African-
American). Unsatisfied with management's response to their complaints,
Gresham and Settles filed identical charges of race discrimination
with the South Carolina Human Affairs Commission (SCHAC)
in December 1994. Following the filing of these charges, SCHAC
brokered a settlement and two nearly identical documents memorializing
the terms of the settlement were signed by Gresham and Settles
on February 15, 1995.

Several provisions of Gresham's settlement agreement (the Settlement
Agreement) are relevant in this appeal.2 First, the Settlement
Agreement provides "that prior to any disciplinary action taken
against [Gresham,] . . . the action must be approved by the Vice President
of Human Resources." (J.A. 15). Second, the Settlement Agreement
provides that Food Lion "agrees that there shall be no
discrimination or retaliation of any kind against [Gresham]." (J.A.
16). Finally, the Settlement Agreement provides:

It is agreed that any future disciplinary actions such as written
constructive advice memoranda and suspensions will be
reviewed by the Vice President of Human Resources prior
to finalization. It is further agreed that any more serious
disciplinary actions such as demotions or involuntary terminations
will be submitted to arbitration which shall be binding
upon Food Lion and Gresham.

(J.A. 18).

In June 1994, while Gresham and Settles' charges of race discrimination
were pending before SCHAC, Marlund Harvey (Harvey), who
is also an African-American, became the Regional Loss Prevention
Field Manager for Southern Division, Region I. When Harvey
became the Regional Loss Prevention Field Manager for Southern
Division, Region I, four loss prevention field agents reported directly
to him. All of these agents, Gresham, Settles, Charles Brown
(Brown), and James Sabb (Sabb), were African-Americans. Harvey
reported to Ron Wooley (Wooley), the Loss Prevention Department
Field Manager, who in turn reported to Clayton Edwards, the Director
of the Loss Prevention Department. Edwards reported directly to
Gene McKinley, the Vice President of Human Resources.

About four months after Harvey became Gresham's supervisor,
Harvey conducted a regularly scheduled performance evaluation of
Gresham. Gresham objected to this evaluation because he felt he had not worked long enough with Harvey to be accurately evaluated. Harvey
agreed that there had not been enough time to make an accurate
evaluation and, pursuant to Gresham's request, the evaluation was
rescinded and Gresham was evaluated on August 17, 1995.

Food Lion's standard evaluation form rates employees in eight categories
on a scale of one to five, with one constituting a rating of
unsatisfactory and five constituting a rating of excellent. Gresham
received an overall evaluation score of 2.5. Gresham received a two
rating (below standard) in four categories - quality and quantity of
output, relating to others, maturity and objectivity, and professional
development. He received a three rating (standard) in the other four
categories.

The two rating in quality and quantity of output reflected the low
number of investigations Gresham was performing. This rating was
validated by the official statistics kept by Food Lion on the number
of investigations conducted and the hours spent on investigations during
1995. Among Harvey's four loss prevention field agents,
Gresham performed the fewest investigations and spent the least
amount of hours on investigations. In contrast, Settles performed the
greatest number of investigations and spent the most hours on investigations.

Harvey's evaluation of his other loss prevention field agents in
1995 resulted in ratings of 2.6 for Settles, 3.0 for Sabb, and 3.6 for
Brown. None of these agents received more than a rating of three in
the critical category of quality and quantity of work.

In late 1995, management undertook a restructuring of its Loss Prevention
Department. Management realized that the staffing level of
loss prevention field agents varied greatly from region to region.
Some regions had up to five loss prevention field agents, while other
regions had only two. In addition, management decided that the
responsibility for safety compliance should be reassigned to one person
within a region. Previously, safety had been just one of the many
responsibilities assigned to loss prevention field agents. A new structure
was established in which each region would be staffed with two
loss prevention field agents and a regional safety manager. The decision was also made at this time to phase out any remaining store
detectives from the Loss Prevention Department.

In Harvey's region, the new structure provided for three positions
where previously there had been four. Harvey was given the responsibility
of choosing which of his loss prevention field agents would
keep positions within the region. Harvey ranked his four loss prevention
field agents based on productivity and performance. The primary
factor relied upon was a loss prevention field agent's productivity as
measured by the number of investigations performed. Wooley had
emphasized the importance of investigations in a January 13, 1995
memorandum in which he stated that investigations should "comprise
the majority" of a loss prevention field agent's time. (J.A. 219). Settles
and Brown were rated as the top agents and Gresham was rated
last in both number of investigations and hours spent on investigations.
Overall performance, as measured by the most recent evaluation
score of each loss prevention field agent, was also considered.
Gresham was rated lowest of the four employees in this area.

Harvey made the decision that the two most productive employees,
Settles and Brown, would be retained as loss prevention field agents
in the region. As the third rated agent, Sabb was transferred to the
regional safety manager position.

On or about January 12, 1996, Harvey met with Gresham, Settles,
Brown, and Saab. Gresham was told at that time that he was not going
to be selected as part of the investigative team in Harvey's region.
Gresham's employment was not terminated; rather, Gresham was
given the option of taking available loss prevention field agent positions
in Virginia or Tennessee. These were identical positions at the
same salary and benefits as the loss prevention field agent position
Gresham held at that time. Gresham was also given the option of pursuing
a store manager or other management position in store operations
in the Augusta area. Gresham rejected these options and
voluntarily resigned as of January 15, 1996.

Thereafter, Gresham filed a complaint against Food Lion in the
United States District Court for the District of South Carolina, alleging
state law causes of action for fraudulent inducement, breach of
contract, negligent supervision, vicarious liability, and negligent breach of contract, along with a claim of employment discrimination
under Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e
et seq. Following Food Lion's motion to dismiss pursuant to Federal
Rule of Civil Procedure 12(b)(6), the district court dismissed Gresham's
state law claims for negligent supervision, vicarious liability,
and negligent breach of contract.

Food Lion filed a motion for summary judgment on Gresham's
Title VII claim, as well as Gresham's remaining state law claims for
breach of contract and fraudulent inducement. On January 5, 1999,
the district court granted summary judgment in favor of Food Lion on
the Title VII claim and dismissed Gresham's remaining state law
claims without prejudice pursuant to 28 U.S.C. § 1367(c)(3).

On January 26, 1999, Gresham filed the instant action against Food
Lion in the Superior Court of Fulton County, Georgia, alleging state
law causes of action for breach of contract, fraudulent inducement,
negligent supervision, and negligent breach of contract. On March 3,
1999, Food Lion removed the case to the United States District Court
for the Northern District of Georgia. Id. §§ 1332, 1441. Thereafter,
venue was transferred to the United States District Court for the District
of South Carolina on July 14, 1999. Id. § 1404.

On August 16, 1999, Gresham voluntarily dismissed his negligent
supervision and negligent breach of contract claims. Thereafter, Food
Lion moved for summary judgment on Gresham's two remaining
state law causes of action (breach of contract and fraudulent inducement).
On March 2, 2001, the district court granted Food Lion's
motion for summary judgment, holding that Gresham's claims for
breach of contract and fraudulent inducement had no merit and that,
in any event, these claims were barred by the doctrine of judicial
estoppel because Gresham had failed to disclose the existence of these
claims in a disclosure statement he filed in connection with a bankruptcy
petition filed by Gresham in the United States Bankruptcy
Court for the Southern District of Georgia.

Gresham noted a timely appeal. On appeal, Gresham only challenges
the district court's decision to grant summary judgment in
favor of Food Lion on his breach of contract claim.

II.

Gresham argues that the district court erred in granting summary
judgment in favor of Food Lion on his breach of contract claim.
Whether a party was entitled to summary judgment is a matter of law
which we review de novo. Higgins v. E.I. DuPont de Nemours & Co.,
863 F.2d 1162, 1167 (4th Cir. 1988). Summary judgment is appropriate
when the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, if any, show that there
is no genuine issue as to any material fact and that the moving party
is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c). In
reviewing the district court's grant of summary judgment, we must
construe the facts in the light most favorable to the non-moving party.
Smith v. Virginia Commonwealth Univ., 84 F.3d 672, 675 (4th Cir.
1996) (en banc).

Under South Carolina law,3 a party to a contract must perform all
obligations assumed under the contract unless the party's performance
is excused by an act of God, the law, or the other party. Pearce-
Young-Angel Co., Inc. v. Charles R. Allen, Inc., 50 S.E.2d 698, 701
(S.C. 1948). According to Gresham, Food Lion failed to perform several
obligations it assumed under the terms of the Settlement Agreement.
More specifically, Gresham argues that Food Lion breached the
Settlement Agreement by: (1) not conducting a performance evaluation
within ninety days of the Settlement Agreement; (2) unfairly
changing the fundamental way it evaluated its loss prevention field
agents; (3) giving him a 2.5 rating on his August 1995 evaluation; (4)
eliminating his job; (5) disciplining him without the prior approval of
McKinley; and (6) denying him his arbitration rights. We shall
address each of these arguments in turn. Gresham argues that Food
Lion retaliated against him by not performing his evaluation in a
timely manner - within ninety days of the Settlement Agreement.
Gresham's argument is flawed in at least two respects. First, the Settlement
Agreement contains no provision providing for an evaluation
in ninety days. Second, Gresham's argument is logically inconsistent.
Gresham objected to the evaluation Harvey conducted of him four
months after Harvey became his supervisor because he did not feel that he had worked with Harvey long enough to be evaluated. Harvey
agreed, and the decision was made to wait before conducting another
evaluation. Obviously, Gresham cannot have it both ways. He cannot
oppose his initial evaluation from Harvey as being conducted too
soon because the two had not worked long enough together and, at the
same time, claim that Food Lion breached the Settlement Agreement
by not evaluating him within ninety days of the Settlement Agreement.

Gresham argues that Food Lion breached the Settlement Agreement's
retaliation provision when it unfairly changed the fundamental
way it evaluated its loss prevention field agents. The Settlement
Agreement does not discuss how loss prevention field agents were
supposed to be evaluated, and the circumstances surrounding how the
loss prevention field agents were evaluated do not suggest the process
was retaliatory in nature.

On January 13, 1995, Wooley, the Loss Prevention Department
Field Manager, issued a memorandum to all loss prevention field
agents. The memorandum, which predated the Settlement Agreement,
indicated what Food Lion expected of its loss prevention field agents.
Wooley had all loss prevention field agents, including Gresham, sign
a copy of the January 13 memorandum. The memorandum discusses
different tasks that should be performed by the loss prevention field
agents in order to carry out their duties. Specifically, the memorandum
states, in part, "[a]ll investigations, which should comprise the
majority of the Agents' time, should be followed up with training to
see that identified problems are corrected." (J.A. 219).

According to Gresham, Wooley's January 13, 1995 memorandum
constituted a radical change in the way loss prevention field agents
would be evaluated, as the focus of evaluations shifted from the
amount of store losses to the number of investigations and the hours
spent on investigations. Gresham's argument fails for the simple reason
that, even if the January 13, 1995 memorandum (which predated
the Settlement Agreement) constituted a change in policy regarding
what was expected of the loss prevention field agents, the evidence
is uncontradicted that these changes applied to all loss prevention
field agents. Gresham offers no evidence to indicate that Food Lion
or Harvey used different procedures or different standards in evaluating any of the loss prevention field agents. Accordingly, we find no
merit to Gresham's contention that Food Lion breached the Settlement
Agreement's retaliation provision when it allegedly changed the
way it evaluated its loss prevention field agents.

Gresham argues that Food Lion breached the Settlement Agreement's
retaliation provision when Harvey gave him a 2.5 rating. The
Settlement Agreement does not discuss how Gresham was supposed
to be evaluated, and the circumstances surrounding Harvey's evaluation
of Gresham do not suggest that Harvey or Food Lion retaliated
against Gresham.

Gresham was evaluated using the same standards as the other loss
prevention field agents who worked in the Loss Prevention Department,
including Settles, who also filed a charge of discrimination
against Food Lion and signed an almost identical settlement agreement
as the one signed by Gresham. Gresham received an overall rating
of 2.5 on a scale of five. Harvey was the only person involved in
Gresham's performance evaluation and was not instructed by any
other representative of Food Lion as to how to rate Gresham's performance.
Gresham admitted that Harvey did not view the evaluation as
bad and, in fact, the evaluation is littered with positive comments by
Harvey about Gresham. Harvey had no knowledge that Food Lion
was planning a restructuring of the Loss Prevention Department at the
time he performed the evaluation, and there is no evidence in the
record that Harvey retaliated against Gresham to affect his future
employment with Food Lion. Under these circumstances, we must
conclude that Food Lion did not retaliate against Gresham when Harvey
gave Gresham a 2.5 rating.

Gresham also argues that Food Lion breached the terms of the Settlement
Agreement when Food Lion eliminated his job as part of the
restructuring of the Loss Prevention Department. This argument has
no merit.

There is no evidence in the record to suggest that the restructuring
of the Loss Prevention Department was implemented, even in part, to
punish Gresham for filing a previous claim of discrimination against
Food Lion or for any other actions by Gresham. Gresham's position
was eliminated as part of a restructuring of the Loss Prevention Department in order to make the department more efficient. Moreover,
Harvey's decision regarding which loss prevention field agents
would remain after the restructuring was based on objective and
business-based criteria.

Next, Gresham argues that Food Lion breached the Settlement
Agreement by disciplining him without receiving prior approval from
McKinley, the Vice President of Human Resources. Although the Settlement
Agreement contains language indicating that Gresham was
not to be disciplined without the prior approval of McKinley, there is
no evidence in the record demonstrating that Gresham was disciplined
in any way by Food Lion after the parties entered into the Settlement
Agreement. As acts of discipline, Gresham points to his 2.5 rating on
his evaluation and the elimination of his position. Logically, an objective
evaluation cannot be construed as an act of discipline. The same
can be said about the elimination of Gresham's position, as the decision
to eliminate Gresham's position was based on objective and
business-based criteria.

Finally, Gresham argues that Food Lion breached the terms of the
Settlement Agreement by denying him arbitration. The Settlement
Agreement provides that "any more serious disciplinary actions such
as demotions or involuntary terminations will be submitted to arbitration
which shall be binding upon Food Lion and Gresham." (J.A. 18).
Unfortunately for Gresham, no action was taken against Gresham that
he could have presented to arbitration under the Settlement Agreement.
Gresham was neither demoted nor involuntarily terminated.
Rather, he voluntarily resigned when he declined to transfer to a loss
prevention field agent position in Virginia or Tennessee or to pursue
a management position in Augusta.

In summary, the evidence, in a light most favorable to Gresham,
fails to support his claim that Food Lion breached the Settlement
Agreement.

* * *

Click the case caption above for the full text of the Court's opinion.

For the reasons stated herein, the judgment of the district court is
affirmed.

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