Labor & Employment Law Daily Wrap Up, DISCRIMINATION—RACE—N.D. Ill.: Black employees of car dealership survive employer’s motion to dismiss discrimination, hostile work environment and IIED claims, (Jul 21, 2025)

By Justin Marcus Smith, J.D.

Among other things, the dealership defendants incorrectly emphasized factual overlap between Illinois Human Rights Act claims and common law intentional infliction of emotional distress tort claims.

Two African-American employees of a car dealership adequately pleaded their respective race discrimination, hostile work environment, retaliation, and intentional infliction of emotional distress claims, ruled a federal district court in Illinois. The employees alleged that the employer embarked on a racist scheme to keep black employees away from dealership customers by stationing them in the service center where customers would not see them. The court found that the employees’ allegations of discrimination were enough to survive a motion to dismiss. The court also ruled that the employees’ intentional infliction of emotional distress claims were not preempted by the Illinois Human Rights Act (Ellis v. Oak Lawn Hyundai, Inc., No. 24 CV 4642 (N.D. Ill. July 15, 2025)).

Discrimination claims. The employees sued the car dealership, alleging that it embarked on a racist scheme to keep black employees away from dealership customers by stationing them in the service center where customers would not see them. According to the first employee, an individual defendant, one of his two direct supervisors, engaged in highly offensive racially-motivated commentary, including in front of coworkers, and ran “excessive” background checks on various minorities. The second employee made similar allegations concerning the individual defendant, and also alleged that she was involved additional discrimination about his multiple sclerosis (MS) diagnosis.

Both employees cross-filed charges of unlawful discrimination with the Illinois Department of Human Rights (IDHR) and the EEOC in mid-2024. The EEOC dismissed the charges and issued both employees notices of right to sue. The second employee filed a discrete complaint in the district based on the same allegations of race and disability discrimination, but he voluntarily dismissed it. A third employee also joined the employees in suing the dealership.

The operative complaint by the three employees alleged: (1) race discrimination under Title VII, § 1981, and the IHRA; (2) hostile work environment based on race under Title VII, § 1981, and the IHRA; (3) race-based retaliation under Title VII, § 1981, and the IHRA, (4) IIED under Illinois common law; (5) disability discrimination under the ADA and § 1981; (6) hostile work environment based on disability under the ADA and § 1981; and disability-based retaliation under the ADA and § 1981. All counts were directed against the dealership, but only the IIED claim was directed toward the individual defendant.

The court entirely denied the employer’s motion to dismiss all claims brought by the first two employees. The court determined that the first employee’s allegations of discrimination were enough to survive a motion to dismiss for Title VII discrimination claims.

The employer first challenged whether he had pleaded an adverse employment action. King said he experienced adverse action when the dealer allegedly segregated Black employees to keep them out of customer-facing roles.

The court found that the employee’s allegation that the employer allegedly segregated Black employees to keep them out of customer-facing roles, alone, was not specific enough to suggest a change in the terms or conditions of his employment. Thus, the court said it could not infer that he experienced an adverse employment action.

Constructive discharge. However, the employee also argued for constructive discharge. Here, the court found that he met the standard for constructive discharge because he alleged embarrassment and humiliation, along with “specific examples of poor treatment” from supervisors based on race, left him with no choice but to resign. The court accordingly held that his allegations were enough to survive dismissal.

Hostile work environment. The court also concluded that the employee’s hostile work environment claim was particularly strong in light the allegation that a supervisor used a racial epithet, in this case, “monkey,” in front of subordinates. The allegations of a “hostile” or “abusive” work environment tracked those the court had already found sufficient to support a claim of constructive discharge.

IIED claim. The court also found the employee alleged enough to state a claim for IIED under Illinois law. The court observed that the Seventh Circuit has clarified that preemption rests not on factual overlap between claims but rather on whether a plaintiff pleads the elements of tort at common law independent of IHRA legal duties. Here, the court concluded the employer did not offer any reason why the employee’s IIED claim relied on an IHRA legal right or duty, and the employer incorrectly emphasized factual overlap between claims.

With respect to the employer’s contention that the conduct was not “extreme and outrageous” enough to state a claim for IIED, the court pointed out that Illinois courts have permitted workplace IIED claims where the employer clearly abused power over an employee beyond what one would expect in typical workplace disagreements. Here, the court found that the employee’s alleged persistent race-based discrimination and harassment from two supervisors going beyond everyday job stress. The court accordingly denied the employers’ motion to dismiss his claim for IIED.

Disability claims. The court held that the second employee’s claims for racial and disability discrimination met the low Swierkiewicz pleading standard for adverse employment action against on the basis of a protected characteristic. The court concluded the employee clearly experienced harm when the employer fired him on account of his race and disability status. Specific allegations about the supervisor allegedly mocking him for looking like a “thug” while dressed in typical work attire, for his MS -related eyesight problems, and for announcing his MS diagnosis to the entire dealer staff “in a rage,” were “more than enough” to give the employer notice to investigate and prepare a defense. The court accordingly denied the employer’s motion to dismiss his claim for race and disability discrimination.

Hostile work environment. Additionally, the court concluded that the second employee plausibly pleaded a hostile work environment. The employee alleged that the supervisor “often publicly humiliated him and other black employees with racially coded language.” And the supervisor allegedly discriminated against him about his MS condition. The court said the employee did not need to show explicitly racial conduct, only that the alleged conduct had a “racial character or purpose.”

As for the employee’s hostile work environment claim related to his disability, the court observed that he alleged he has MS with resulting “limitations” including difficulty with eyesight. The court therefore concluded he adequately alleged vision loss disability under the ADA.

Further, the court found that the employee plausibly pleaded facts that a reasonable jury could find “severe or pervasive,” including the supervisor’s public announcement to the entire staff that the employee had MS. This public disclosure of the employee’s MS and the other eyesight-related comments were enough to state a plausible hostile work environment claim under the ADA.

Retaliation for disability claims. With respect to the second employee’s retaliation claim, he argued he engaged in two protected activities. First, the employee pointed to having pushed back against the supervisor in front of managers and coworkers for ridiculing his eyesight. But the court suggested this single instance might not be protected activity. Second, the employee alleged he engaged in protected activity when he asserted that the supervisor’s behavior was inappropriate and disrespectful. This second instance of an alleged complaint escalation was protected activity. The court said it could reasonably infer that Mattox escalated his complaint to management in a way that tied the supervisor’s alleged conduct to his race and disability status. Accordingly, the court denied the employer’s motion to dismiss his retaliation claims.

IIED claim. The employer also argued IHRA preemption in connection with the second employee’s IIED claim. The court found the sum of the allegations sufficient to state an IIED claim, especially where the employee alleged conduct came from a supervisor and would cause more than everyday job stress. The court declined to hold as a matter of law that such behavior was not sufficiently extreme and outrageous to state a claim for IIED.

The court did not consider the third employee’s claims because it had previously granted the employer’s motion to stay their answer to his claims pending disposition of the motion to dismiss the claims of the first two employees.

The case is No. 24 CV 4642.

Judge: Alexakis, G.

Attorneys: Uche O. Asonye (Asonye & Associates, Attorneys at Law) for Tracey Ellis. Patrick John Ruberry (Litchfield Cavo) for Oak Lawn Hyundai Inc. dba Happy Hyundai.

Companies: Oak Lawn Hyundai Inc.; Happy Hyundai

Cases: Discrimination RaceDiscrimination DisabilityDiscrimination Discharge IllinoisNews