It’s been more than 30 years since the now infamous case of a woman who sued McDonald’s after she spilled a cup of scalding coffee into her lap, which ended up producing third-degree burns on over 16% of her body.

However, it appears that the question over who is liable in these situations, the customer or the company, remains from resolved.

Three Starbucks hot teas from the drive-thru. The incident centers on Michael Garcia, a Los Angeles man who was working as a Postmates driver in February 2020. That month, the then 25-year-old Garcia was picking up a delivery order of three venti-sized hot teas from the Starbucks drive-thru window. When Garcia took hold of the to-go carrier, one of them overturned, which spilled the hot tea all over his lap.

Garcia experienced severe injuries because of the incident, sustaining third-degree burns to his penis, groin, and inner thighs. The Los Angeles man has undergone multiple surgeries and skin grafts to treat his injuries. To this day, he continues to experience pain.

The allegations. Garcia proceeded to sue Starbucks, setting off a year-long court battle. According to Garcia, Starbucks was the one at fault in the incident because the barista failed to adequately close the lid on the drink, an action his attorneys classified as negligence.

Starbucks initially denied the allegations, The Los Angeles Times reported, stating that Garcia had not sustained “any injury, damage or loss by reason of any act or omission” by one of its employees. The company later claimed that Garcia was also at fault in the incident, stating that it was “contributory negligence.”

"Starbucks says if our hands are off the drink, then no matter what happens, we're not responsible," Nicholas Rowley, Garcia's trial attorney, said. "So, if I'm Starbucks and I hand you a drink that doesn't have a lid that's secured, and it's a scalding hot, 180-degree drink, or if I hand you a drink that's in a container and it's loose and it's not secured, and it falls right on you—the moment that I take my hands off of it, then you're responsible and I, the corporation, am not."

The lawsuit. Garcia’s lawyers say that Starbucks offered their client $30 million to settle the case confidentially. When the legal team countered and said they would accept $30 million without confidentiality and only if Starbucks apologized publicly and promised to change its policy around hot drinks, the company refused.

According to Garcia’s lawyers, Starbucks consistently denied responsibility for the incident throughout the five years the trial lasted.

The verdict. In mid-March, a California jury awarded Garcia, now 30 years old, $50 million in damages. Overall, the payout will amount to more than $60 million with pre-court interest, costs, and attorneys’ fees.

However, Starbucks said the fight isn’t over yet.

"We sympathize with Mr. Garcia, but we disagree with the jury's decision that we were at fault for this incident and believe the damages awarded to be excessive," a Starbucks spokesperson said in a statement. "We plan to appeal. We have always been committed to the highest safety standards in our stores, including the handling of hot drinks."

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Looking forward. This isn’t the last case over hot drinks that end up scalding people in America. As noted by the Times, another Los Angeles resident, Muriel Evans, sued Starbucks last year after suffering severe burns from a “mishandled” to-go coffee. In this case, Evans claims that the Starbucks barista spilled the coffee into her lap.

Evans’ attorneys claim that the coffee she was given had a temperature of 190 degrees Fahrenheit, close to boiling point, which could be “considered negligent serving practices.”

Images | Anton Ponomarenko | Hamza Inayat

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Amid a reversal of its open door policy, Starbucks tested out adding panic buttons in U.S. stores for employees to use if they felt unsafe. When pressed, the button alerted the company’s local security team and remotely locked the store’s front doors.

Closing doors. Announced earlier this month, Starbucks’ new policy requires people to make a purchase to hang out in its lounges or use its bathroom. It’s a reversal of a 2018 open door policy that considered “any person who enters our spaces” a customer, whether they made a purchase or not.

Although the company’s open door policy looked good on paper, it led to issues at some of its stores. These included people who slept on its chairs or stayed in the bathroom for hours; an influx of homeless people who workers were not trained to assist; and unruly teens.

Starbucks spokeswoman Jaci Anderson told the Associated Press that the new rules were designed to prioritize paying customers.

“We want everyone to feel welcome and comfortable in our stores,” Anderson said. “By setting clear expectations for behavior and use of our spaces, we can create a better environment for everyone.”

Potential consequences. Starbucks explained that employees would receive training on how to enforce the new policy. These included de-escalation tactics if customers refused to leave, according to Fortune. However, some employees believe this training will be enough to deal with potentially tense situations.

A Starbucks employee in Philadelphia, who was not named, told the outlet that some people aren’t likely to respond well to the new policy. The employee said their store is “high incident,” which means that employees are receive harassment and “verbal abuse” from customers.

“We know that these situations are going to happen more frequently in our store,” the employee said. “And we will not be able to take the measures that we need to make ourselves safe.”

Over on the r/Starbucks subreddit, some employees appeared frustrated over having to become “bouncers” on top of their other responsibilities.

The panic buttons. Given these concerns, Starbucks’ move to install panic buttons in some of its stores wasn’t surprising. However, the panic buttons were only installed in five stores in the U.S. in a small pilot on optimizing in-store security. In 2024, Starbucks had nearly 17,000 company-operated and licensed stores in the U.S.

According to Starbucks, the panic buttons aren’t getting rolled out to more stores, stating that it “frequently testing many things to see what works and what doesn’t.For what it’s worth, the Starbucks employee that spoke to Fortune had one of the buttons installed in his store. They said they hadn’t been trained on when it was appropriate to use the panic button.

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Cheat codes. Starbucks’ new policy officially went into effect on Monday. As of publication, it doesn’t look like there’s been any high-profile incidents of chaos or dissent or the pay-or-go-away initiative. Some employees against the new policy are using Reddit to tell people the cheapest thing available to buy so they can stay in the store.

“If a barista gets suspicious of you, definitely DON'T purchase a cream cheese for $1.00, an avocado spread for $1.25, or a bag of butter popcorn for $1.50 (some of our cheapest items) so you can stay as long as you want,” a self-identified Starbucks employee said on r/Starbucks. “And please know that we were instructed to police EVERY PERSON that asks to use the bathroom. So please DON'T tell us that you'll buy something after you use the bathroom, and then leave right after, because we'll definitely do something about it!”

Images | Justus Menke | June Andrei George

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Nearly seven years after it opened its doors to all, regardless of whether they bought anything, Starbucks is taking a step back. In fact, the coffee giant is now closing its doors to anyone who is not a paying customer.

An Open-Door Policy for Paying Customers

Starbucks announced the new policy for its North American stores on Monday. The policy states that people who want to hang out in its cafeteria or use its restroom will have to buy something. A new code of conduct for customers also bans discrimination, harassment, consumption of alcohol not purchased at Starbucks, smoking, drug use, and panhandling, the Associated Press reported.

People who break the rules will be asked the leave. Starbucks said the stores may call the police if they feel it’s necessary. Starbucks spokesperson Jaci Anderson told the outlet that the new policy aimed to prioritize paying customers.

“We want everyone to feel welcome and comfortable in our stores,” Anderson said. “By setting clear expectations for behavior and use of our spaces, we can create a better environment for everyone.”

The 2018 Incident

The coffee giant instituted its open-door policy in 2018 after an incident involving two Black men, Rashon Nelson and Donte Robinson, at one of its stores in Philadelphia. The men, who were 23 years old at the time, had gone to the Starbucks for a business meeting and had not ordered anything. One of them asked to use bathroom but was told it was for paying customers only.

A Starbucks employee proceeded to approach the Nelson and Robinson at their table and ask if they needed anything, which they declined. According to The Guardian, the police arrived a few minutes later and arrested them. Both feared for their lives.

“Anytime I’m encountered by cops, I can honestly say it’s a thought that runs through my mind,” Nelson said. “You never know what’s going to happen.”

The arrest of Nelson and Robinson was recorded and posted online, where it went viral and quickly became an embarrassment for the company. A month later, Starbucks unveiled its open-door policy, which stated that “any person who enters our spaces… is considered a customer.”

An Imperfect Policy

While opening its doors to everyone might sound good on paper, it was more difficult than it seemed in practice. Starbucks chairman Howard Schultz acknowledged the potential challenges before the company implemented the policy in a public talk on corporate responsibility.

“We don’t want to become a public bathroom, but we’re going to make the right decision 100% of the time and give people the key,” he said.

As noted by the Associated Press, workers and customers have had to deal with unruly and at times dangerous behavior since the company implemented the open-door policy. In 2022, Starbucks closed 16 stores in Seattle, Los Angeles, Philadelphia, and Washington because of safety issues.

At the time, company executives said challenges facing the U.S., including the mental health crisis and rising drug use, sometimes reach their stores, too. Some stores have also become go-to spots for the homeless, who workers are not trained to help.

Response

Over on r/Starbucks, a self-proclaimed subreddit for Starbucks friends and fans, several users appeared to welcome the company’s announcement. Some told stories about people who took advantage of the previous open-door policy, sleeping on the chairs or staying in the bathroom for hours. Others spoke about having to deal with loud and unruly teens who order a slew of waters but don’t respect the space.

“It makes sense to define some clear boundaries,” one user said. “Probably shouldn't just kick people out immediately, but there's no reason for non-customers to be able to hang out all day.”

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Burying the “Third Place"

Notably, some Reddit users said the new policy marked the end of Starbucks as a “third place.” That’s how Starbucks described itself for years, defining the third place as a space between work and home where they could hang out for hours.

“If you look at the landscape of retail and restaurants in America, there is such a fracturing of places where people meet,” Schultz said in a 1995 interview. He’s served as the company’s CEO three times over nearly decades. “There’s nowhere for people to go. So, we created a place where people can feel comfortable.”

Years later, the company’s message is quite different. It’s a place for you go—if you pay.

Images | kevs | 99.films

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One of the things that marked the end of the pandemic was the return to the office. In some cases, the return was absolute. In others, however, companies opted for a hybrid model, allowing employees to work at home a certain number of days per week and requiring them to be in the office the rest of the week.

This is the case at Starbucks. Effective January 2023, the company’s policy requires employees to be in the office at least three days a week. The policy includes the company's next CEO, Brian Niccol. However, unlike other employees, he'll have specific amenities worthy of a person earning $1.6 million a year plus incentives.

1,000 miles. This is the distance between Newport Beach, California, and Seattle, Washington. The first city is where Niccol lives. The second is the headquarters of Starbucks. As the company’s CEO, one might expect he would move to Washington to work from the headquarters, but that's not the case. As the offer letter made public last week states:

“During your employment with the company, you will not be required to relocate to the company’s headquarters (currently in Seattle, Washington). You agree to commute from your residence to the company’s headquarters (and engage in other business travel) as is required to perform your duties and responsibilities.”

That means that Starbucks expects the CEO to go to its Seattle headquarters at least three times a week when he’s not on a business trip, a company spokesman told CNBC.

​​The subway doesn’t go this far. Unfortunately, driving from Newport Beach to Seattle and back three times a week doesn’t seem feasible, but that’s not a problem for Niccol, as the offer also includes the use of the company plane for “business-related travel in accordance with the company’s travel policy, travel between your city of residence and the company’s headquarters in Seattle, Washington and your personal travel in accordance with the company’s policies, up to a maximum amount of $250,000 per year.” 

In addition, Starbucks will establish a small remote office in Newport Beach for its new CEO and an assistant of his choice.

Niccol's schedule. The same company spokesperson told CNBC that “Brian’s primary office and a majority of his time will be spent in our Seattle Support Center or out visiting partners and customers in our stores, roasteries, roasting facilities, and offices around the world. His schedule will exceed the hybrid work guidelines and workplace expectations we have for all partners.”

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His salary. Niccol, who was previously the CEO of Chipotle, will earn $1.6 million annually. Depending on his performance, he will receive between $3.6 million and $7.2 million in bonuses and up to $23 million per year in stock.

Imagen | Starbucks

His previous job. Niccol was the CEO of Taco Bell until 2018. Taco Bell’s headquarters are in Irvine, California, a 15-minute drive from Niccol’s home in Newport Beach. In 2018, he became CEO of Chipotle, whose headquarters were in Denver, Colorado, 1,000 miles from his home. Three months after he took the job, Chipotle moved its headquarters from Denver to Newport Beach. The move affected 400 people.

Power differentials. This case is striking for one simple reason: it brings to the table the differences in bargaining power between a senior executive and a more junior employee when it comes to flexibility, remote work, and transportation. In fact, it’s not a matter of differences. It’s a huge gap, but it’s one of the prices that companies like Starbucks are willing to pay to hire a star executive like its future CEO.

Former Starbucks CEO Laxman Narasimhan. Image | Starbucks

Starbucks is going through a tough time. Its stock has been falling for a year, and a few months ago, former CEO Howard Schultz posted a message on LinkedIn criticizing the company’s leadership. CEO Laxman Narasimhan left the company in the aftermath, and Starbucks announced hiring Niccol, a person who had successfully managed major crises at two well-known brands, Taco Bell and Chipotle.

Remote work at two tiers. This case illustrates how the return to the office happens in two separate ways. On one hand, CEOs and senior executives can live where they want and commute to the office at no additional cost if the company covers the expenses.

On the other hand, companies may force lower-level employees to move to a different city and even live in specific neighborhoods. They may also be forced to choose between never being promoted or spending a significant amount of time and money to get to the office.

This article was written by Jose García and originally published in Spanish on Xataka.

Image | Chipotle, Starbucks edited by Xataka On

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