A federal appeals court has reversed a district court’s order granting summary judgment to Farmers Insurance after finding that previously inadmissible comments from a district manager referring to an employee as a “brown man” in discussing his potential firing did not constitute hearsay and could be admissible under federal evidence rules.

Michael Cruz, a Hispanic man of Mexican American heritage, filed a complaint in the U.S. District Court for the District of Colorado claiming that Farmers Insurance terminated his contract with the insurer based on race.