Starbucks, Anti-Bias Training, and Defamation

The story about the Starbucks manager who is no longer a Starbucks manager has gone viral.  Holly Hylton, a former manager at a Philadelphia Starbucks, denied two male customers the use of the facility restroom because they had not ordered or purchased anything at the store.  The manager also asked the men to leave because they had not ordered anything and they refused.  The men explained that they were waiting for a friend for a business meeting.  Ms. Hylton called the police and when the men refused to leave they were arrested.  The men were not creating a scene nor were they being disruptive.  The men were black and Ms. Hylton was accused of racial bias.  Shortly following the incident, Ms. Hylton no longer worked at the Starbucks, which the company has explained was the result of mutual agreement.  Starbucks founder Howard Schultz was interviewed and said that the company's 8,000 stores would close on Sunday so that employees could participate in anti-bias training.  Mr. Schultz indicated in an interview that he had watched the tape of the actions and concluded that it was clear to him that there had been bias. 

Ms. Hylton was following Starbucks's policy, which requires a purchase in order to use the facility's restroom.  She was also following Starbuck's policy to simply call the police when customers who have not ordered anything will not leave the store.  Ms. Hylton has been labeled a racist on social media, and Mr. Schultz's comments have portrayed Ms. Hylton in a bad light.  

There are several legal questions that result from the incident and subsequent actions.  When can customers be asked to leave a store or restaurant?  Charisse Jones, "When Is It OK to Lick Someone Out of a Store?" USA Today, April 19, 2018, p. 1B. Businesses can have policies on handling customer behavior.  Most companies develop such policies in conjunction with legal counsel.  The key to the policies is uniform enforcement. And that enforcement cannot be tied to how the customers are dressed.  Customers should have the rules explained.  If they refuse to follow the rules then the warning about calling the police should be given.  If the customers still refuse, then the store policy of calling the police should also be followed, consistently. The goal in such policies is to prevent altercations and injuries to either or both employee and the individual involved. If the business treats everyone farily and equally, the policy is not considered racist.  The key is uniformity and treating the customers with dignity.

Many lawyers have come forward, however, to offer to represent Ms. Hylton because of the comments made by Mr. Schultz.  His comment suggests that her behavior was racist and no one has, as yet, spoken to her or determined t=exactly what was said.  Portraying her in a bad or false light is the stuff of defamation.  In addition, there are questions related to her termination, particularly if she was following and had consistently followed store policies on customers who do not order anything at the store. 

Starbucks acted quickly to handle the public relations issues by announcing its training.  Termination of Ms. Hylton also became public and added to the company's public relations strategies.  Protests of companies following such incidents have been common and Starbucks acted quickly to avoid additional backlash.  However, those actions, when accompanied by Mr. Schultz's statement, could have a long-term effect on Ms. Hylton's reputation as well as her ability to find employment.  Those types of damages are part of a defamation case. As one lawyer noted, "Mr. Schultz should be prepared to get out his checkbook."


Explain the events and the legality of asking customers to leave.

Discuss the elements of defamation.