Judge: Daniel S. Murphy, Case: 21STCV36871, Date: 2023-05-03 Tentative Ruling

Case Number: 21STCV36871    Hearing Date: May 3, 2023    Dept: 32

BACKGROUND

            On October 6, 2021, Plaintiff Gabriel Cardenas initiated this action against Defendants Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, The Permanente Medical Group, Inc, and Southern California Permanente Medical Group. The complaint alleges (1) race discrimination, (2) age discrimination, (3) FEHA retaliation, (4) whistleblower retaliation, and (5) failure to prevent.

            Plaintiff contends that he applied for 270 positions and was passed over for all of them due to his age or race. Plaintiff claims that Defendants have a system in place to promote pre-identified candidates and that the competitive selection process is merely a front to give the impression of fairness. Plaintiff alleges that he was passed over in favor of younger, non-Hispanic applicants even though he was more qualified. Plaintiff claims that Defendants retaliated against him for raising concerns about the foregoing by refusing to promote him.

            On November 18, 2022, Defendants filed the instant motion for summary judgment or adjudication in the alternative.

LEGAL STANDARD

The function of a motion for summary judgment or adjudication is to allow a determination as to whether an opposing party cannot show evidentiary support for a pleading or claim and to enable an order of summary dismissal without the need for trial. (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 843.) Code of Civil Procedure section 437c, subdivision (c) “requires the trial judge to grant summary judgment if all the evidence submitted, and ‘all inferences reasonably deducible from the evidence’ and uncontradicted by other inferences or evidence, show that there is no triable issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” (Adler v. Manor Healthcare Corp. (1992) 7 Cal.App.4th 1110, 1119.) “The function of the pleadings in a motion for summary judgment is to delimit the scope of the issues; the function of the affidavits or declarations is to disclose whether there is any triable issue of fact within the issues delimited by the pleadings.” (Juge v. County of Sacramento (1993) 12 Cal.App.4th 59, 67, citing FPI Development, Inc. v. Nakashima (1991) 231 Cal. App. 3d 367, 381-382.)

As to each claim as framed by the complaint, the defendant moving for summary judgment must satisfy the initial burden of proof by presenting facts to negate an essential element, or to establish a defense. (Code Civ. Proc., § 437c, subd. (p)(2); Scalf v. D. B. Log Homes, Inc. (2005) 128 Cal.App.4th 1510, 1520.) Once the defendant has met that burden, the burden shifts to the plaintiff to show that a triable issue of one or more material facts exists as to that cause of action or a defense thereto. To establish a triable issue of material fact, the party opposing the motion must produce substantial responsive evidence. (Sangster v. Paetkau (1998) 68 Cal.App.4th 151, 166.) Courts “liberally construe the evidence in support of the party opposing summary judgment and resolve doubts concerning the evidence in favor of that party.” (Dore v. Arnold Worldwide, Inc. (2006) 39 Cal.4th 384, 389.)

EVIDENTIARY OBJECTIONS

Defendants’ Objections to Plaintiff’s Evidence:

• Cardenas Declaration
• Defendants’ objections are overruled.
• Cardenas Deposition
• Defendants’ objections are overruled.
• Fowler Declaration
• The following objections are sustained: 6, 8-11.
• The following objections are overruled: 1-5, 7.

DISCUSSION

I. Statute of Limitations

            Effective January 1, 2020, Assembly Bill 9 extended the statute of limitations for a FEHA claim from one to three years. (See Gov. Code, § 12960(e)(5).) However, the expanded limitations period does not apply retroactively to claims that have already lapsed. (See Quarry v. Doe I (2012) 53 Cal.4th 945, 957 [“Once a claim has lapsed (under the formerly applicable statute of limitations), revival of the claim is seen as a retroactive application of the law under an enlarged statute of limitations. Lapsed claims will not be considered revived without express language of revival”].)

Defendants argue that claims based on conduct prior to January 1, 2019 are time-barred. Plaintiff filed his DFEH complaint on September 23, 2021. While an employer may be liable for “conduct occurring outside the statute of limitations if it is sufficiently connected to unlawful conduct within the limitations period” (Trovato v. Beckman Coulter, Inc. (2011) 192 Cal.App.4th 319, 325), that does not mean all 270 positions that Plaintiff applied to throughout the course of his career are actionable. Plaintiff has no evidence suggesting that the 23 actionable rejections within the limitations period are part of a discriminatory pattern with the other 200+ rejections occurring outside the limitations period. Discrete actions such as rejection or termination are sufficiently permanent to begin the running of the statute. (Willis v. City of Carlsbad (2020) 48 Cal.App.5th 1104, 1127-28.) “There are no other allegations that suggest [Plaintiff] could have perceived [Defendants’] actions on these discrete job openings as anything other than definitive and final.” (Ibid.) Therefore, the claims are barred by the statute of limitations to the extent they are based on application rejections prior to January 1, 2019.  

II. Defendants TPMG and KFHP

            Defendants argue that The Permanente Medical Group (TPMG) and Kaiser Foundation Health Plan (KFHP) must be dismissed because they did not employ Plaintiff. In his deposition, Plaintiff could not identify any facts suggesting that he was employed by either TPMG or KFHP rather than Southern California Permanente Medical Group (SCPMG). (UF 2.) Plaintiff did not apply to any jobs at KFHP or TPMG between January 1, 2019 and November 16, 2022. (UF 3.)

            Plaintiff argues that all of the Defendant entities can be considered his employer under the integrated enterprise test. “An employee who seeks to hold a parent corporation liable for the acts or omissions of its subsidiary on the theory that the two corporate entities constitute a single employer has a heavy burden to meet under both California and federal law. Corporate entities are presumed to have separate existences, and the corporate form will be disregarded only when the ends of justice require this result . . . In particular, there is a strong presumption that a parent company is not the employer of its subsidiary's employees.” (Laird v. Capital Cities/Abc (1998) 68 Cal.App.4th 727, 737, internal citations omitted.) “To make a sufficient showing of ‘interrelation of operations’ on summary judgment, the plaintiff must do more than merely show that officers of the subsidiary report to the parent corporation or that the parent benefits from the subsidiary's work. Since these facts exist in every parent-subsidiary situation, such a showing would create a triable issue of material fact in every case. What the plaintiff must show, rather, is that the parent has exercised control ‘to a degree that exceeds the control normally exercised by a parent corporation.’” (Id. at p. 738.)

            The facts mentioned in Plaintiff’s opposition are insufficient to overcome the presumption that corporate entities are distinct. (See Opp. 12:12-13:9.) Plaintiff points out that the Defendants share offices, administrative facilities, revenue, and personnel policies. These facts do not demonstrate a level of day-to-day control beyond what is expected in a typical parent-subsidiary relationship. Critically, Plaintiff has “produced no evidence that [TPMG and KFHP] exercised day-to-day control over [SCPMG’s] employment decisions in general or that [they] exercised any control over [SCPMG’s] decisions with respect to [him].” (See Laird, supra, 68 Cal.App.4th at pp. 738-39.) Therefore, TPMG and KFHP must be dismissed.

III. Discrimination

Government Code section 12940, subdivision (a) prohibits an employer from discriminating against an employee based on a protected characteristic. In order to establish a claim of discrimination, Plaintiffs must prove: (1) they are in a protected class; (2) an adverse employment action was taken against them; (3) at the time of the adverse action they were satisfactorily performing their jobs; and (4) some other circumstance suggesting discriminatory motive. (Guz v. Bechtel (2000) 24 Cal. 4th 317, 355.)

Under the McDonnell-Douglas framework, (1) the plaintiff must initially establish a prima facie case of discrimination, (2) the defendant must then articulate a legitimate nonretaliatory explanation for its acts, and (3) in response, the plaintiff must show that this explanation is pretextual. (Patten v. Grant Joint Union High School Dist. (2005) 134 Cal.App.4th 1378, 1384.) However, this is the burden of proof for trial, and it does not change the defendant’s initial burden on summary judgment. (Cornell v. Berkeley Tennis Club (2017) 18 Cal.App.5th 908, 926.) Therefore, on summary judgment, the defendant employer must either (1) undermine an element of the plaintiff’s prima facie case or (2) provide a legitimate nonretaliatory reason for the adverse employment action. (Ibid.)

a. Prima Facie Case

            Defendants argue that Plaintiff cannot establish a prima facie case for the following reasons: (1) five of the postings were never filled at all; (2) Plaintiff declined to proceed with three of the applications; (3) Plaintiff’s application was never screened for seven of the positions; (4) recruiters screened out two of Plaintiff’s applications; and (5) Plaintiff cannot show discriminatory animus for the six applications that proceeded to Manager Review.

            The Court agrees with Defendants as to the first two reasons. Plaintiff cannot claim that Defendants favored younger or non-Hispanic applicants if no one got the position at all. And Plaintiff cannot claim discrimination based on positions that he never applied for. However, the failure to screen Plaintiff, which denies Plaintiff the position, may constitute a discriminatory act if done for an improper purpose. Discriminatory motive is not limited to the later Manager Review step. Therefore, the issue is whether Defendants rejected Plaintiff’s applications, at any stage, based on his age or race.

            That being said, Plaintiff has no such evidence. Plaintiff testified that no one made derogatory comments about his age or race and could not identify facts demonstrating a hiring manager’s bias against Hispanics or older people. (Def.’s Ex. A at pp. 90-101.) While Plaintiff insists that the individuals hired over him were younger, non-Hispanic, and less qualified, he presents no actual evidence of their age, race, or qualifications. The only evidence indicating the age or race of the other applicants shows that they were also minorities and around the same age as Plaintiff. (See, e.g., UF 40.) Plaintiff testified about a single comment by Peter Cho, a project manager who told Plaintiff that “they’re looking for someone younger.” (Def.’s Ex. A at 90:17-21, 91:21-23.) However, this is hearsay and Cho’s speculation. Plaintiff testified that Cho was not involved in his hiring at all, so there is no basis for Cho to know that Plaintiff was rejected because of his age. (Id. at p. 92:9-12.) Plaintiff also relies on the declaration of an expert from a different case against Kaiser discussing Kaiser’s pattern of underpaying Hispanic employees. (See Plntf.’s Ex. M.) This declaration is inadmissible and does not contribute to a triable issue. (See Herrera v. Deutsche Bank National Trust Co. (2011) 196 Cal.App.4th 1366, 1375 [“While courts take judicial notice of public records, they do not take notice of the truth of matters stated therein”].) Plaintiff also never asserted a class-wide disparate impact claim; rather, he asserts intentional discrimination against one employee, himself.  

            Plaintiff points out that Defendants had a system of promoting pre-identified candidates. Plaintiff contends that while Defendants purported to open a competitive position, the pre-identified candidates would always be chosen. However, FEHA is not concerned with an employer making bad employment decisions. (See Sada v. Robert F. Kennedy Med. Ctr. (1997) 56 Cal.App.4th 138, 155; Hicks v. KNTV Television Inc. (2008) 160 Cal.App.4th 994, 1005.) Such decisions will not be disturbed unless the employer makes them for a discriminatory purpose. While it may be unwise for Defendants to preselect certain candidates instead of hiring based on merit, this is not prohibited by FEHA. As discussed above, Plaintiff has no evidence that he was rejected based on age or race.

Therefore, Plaintiff has failed to raise a triable issue as to his prima facie case. The discrimination claim fails for this reason alone.

b. Legitimate Reason

Defendants argue that Plaintiff was not selected because he was not the most qualified candidate. (See Mtn. 12:10-13:19 [chart detailing open positions and their requirements, and comparing Plaintiff’s qualifications to those of the selected candidates].) In particular, Plaintiff had no experience directly supervising any employees. (UF 15.) Furthermore, based on various complaints against Plaintiff by his coworkers, Plaintiff was determined not to have the skillset necessary to be in a supervisor role. (Hall Decl. ¶¶ 15-19.)  

In the face of a nondiscriminatory reason, the plaintiff must offer “substantial evidence” allowing a reasonable conclusion that “the employer engaged in intentional discrimination.” (Foroudi v. The Aerospace Corp. (2020) 57 Cal.App.5th 992, 1007.) “The employee’s evidence must relate to the motivation of the decision makers and prove, by nonspeculative evidence, ‘an actual causal link between prohibited motivation and termination.’” (Id. at p. 1008, citing Featherstone v. Southern California Permanente Medical Group (2017) 10 Cal.App.5th 1150, 1159.)

Plaintiff’s subjective belief that he was more qualified than other candidates is insufficient. Plaintiff has no evidence of the qualifications of the other candidates compared to his own. And even if Defendants hired less qualified candidates, an unwise employment decision is not prohibited by FEHA. Plaintiff also argues that Defendants’ proffered reason is inconsistent and uncredible. However, “[t]he ultimate question is whether the employer intentionally discriminated, and proof that the employer's proffered reason is unpersuasive, or even obviously contrived, does not necessarily establish that the plaintiff's proffered reason ... is correct.” (Arteaga v. Brink's, Inc. (2008) 163 Cal.App.4th 327, 343.) As discussed above, Plaintiff has no evidence of age or race discrimination, much less substantial, nonspeculative evidence. Therefore, Plaintiff has failed to raise a triable issue as to Defendants’ proffered justifications.

Because Plaintiff has failed to establish a prima facie case or to demonstrate pretext, the discrimination claim fails as a matter of law.   

IV. FEHA Retaliation

To establish a prima facie case of FEHA retaliation, Plaintiff must show: (1) he engaged in a “protected activity”; (2) the employer subjected him to an adverse employment action; and (3) a causal link existed between the protected activity and the employer’s action. (Moore v. Regents of University of California (2016) 248 Cal.App.4th 216, 244.)

Defendants argue that the hiring managers responsible for Plaintiff’s applications had no knowledge of his protected activity. (UF 44, 48, 53, 57, 64.) Defendants also point out that promotion to a supervisory role requires a job opening and application. (Hall Decl. ¶ 14.)

In opposition, Plaintiff points to the various complaints that he made from 2019 to 2021 and argues that he has not been promoted since he began working in 2012. (Opp. 18:8-19.) Plaintiff also mentions a meeting he had with supervisor Maureen O’Flaherty in March 2021, where Plaintiff complained of discrimination. Plaintiff testified that O’Flaherty became irate during that meeting and stated to him that he would never be part of her management team. (Plntf.’s Ex. H at 85:1-87:5.)

 However, Plaintiff does not identify any adverse employment actions that occurred shortly after each complaint. While O’Flaherty’s comments from March 2021 may be probative of retaliatory intent, Plaintiff does not identify what position he was rejected from afterwards or explain how O’Flaherty was involved in that rejection. The general lack of promotion since 2012 is not an adverse employment action unless Plaintiff applied and was rejected. Plaintiff has no evidence to rebut the fact that Kaiser policy requires an open competition for supervisory positions rather than simply promoting someone. (See Hall Decl. ¶ 12; Def.’s Ex. D.) Plaintiff does not contend that he applied for an open supervisor position.

Plaintiff argues that he did not need to apply for an open position because Defendants were already willing to promote him. In 2018 and 2019, Defendants determined that Plaintiff was working beyond scope and worked with him to find a new job title that fit his duties. (Plntf.’s Ex. A; Ex. H at p. 67:2-69:25.) Plaintiff’s title was never changed, but Plaintiff’s duties were adjusted in March or April 2021 because Plaintiff was deemed to have been performing duties that were out of scope for a union-represented employee. (Hall Decl. ¶ 21.) Plaintiff met with managers to clarify the scope of his duties, and at the end of that meeting, Plaintiff confirmed that the information was what he was looking for in terms of clarity and direction. (Def.’s Ex. B at 261:10-13.) Plaintiff testified that “it was made very clear” that his previous duties were being handed to another employee. (Id. at 261:7-9.)

Plaintiff cites no authority for the proposition that not changing a job title constitutes an adverse employment action, nor does Plaintiff adequately articulate a connection between that and the complaints he made. Additionally, Defendants did eventually address the issue of Plaintiff working out of scope. None of this changes the fact that advancement to a supervisor role requires a job opening and application. Assuming Plaintiff’s title needed to be changed to match the scope of his duties, that does not mean promotion to a management-level role. Plaintiff testified that the 2019 discussions resulted in narrowing down to two potential titles, but Plaintiff could not recall what those titles were. (Plntf.’s Ex. H at 69:5-8.) Plaintiff has no evidence that he was guaranteed a supervisory promotion.

Furthermore, Plaintiff has no evidence to dispute the fact that Hall determined from multiple complaints that Plaintiff was not suitable for a supervisor position. (See Hall Decl. ¶ 13.) Plaintiff argues that Hall suddenly changed her mind after initially being open to the idea of Plaintiff applying to be supervisor. However, nothing prohibits Hall from changing her mind due to COVID budget constraints and complaints against Plaintiff. (Id., ¶¶ 9, 13.) Plaintiff does not dispute the budget issues or the complaints. Plaintiff claims he has never heard of any complaints against himself. (Plntf.’s Resp. to UF 27.) However, that does not affect what information Hall received or alter her subjective belief that Plaintiff was unsuitable to be a supervisor. (See King v. United Parcel Serv., Inc. (2007) 152 Cal.App.4th 426, 433 [employer’s honest belief that employee committed a policy violation is sufficient to justify adverse employment action even if employee did not actually commit violation].)

In the face of these facially neutral reasons, Plaintiff has no substantial evidence to demonstrate that Defendants’ actual motivation was to retaliate against him for reporting discrimination. “[T]emporal proximity alone is not sufficient to raise a triable issue as to pretext once the employer has offered evidence of a legitimate, nondiscriminatory reason for the termination.” (Arteaga, supra, 163 Cal.App.4th at p. 353.)

Because Plaintiff cannot raise a prima facie case or establish pretext, the retaliation claim fails as a matter of law.

V. Whistleblower Retaliation

Labor Code section 1102.5, subdivision (b) makes it unlawful for an employer to retaliate against an employee for reporting a perceived violation of a local, state, or federal statute or regulation. “[O]nce it has been demonstrated by a preponderance of the evidence that an activity proscribed by Section 1102.5 was a contributing factor in the alleged prohibited action against the employee, the employer shall have the burden of proof to demonstrate by clear and convincing evidence that the alleged action would have occurred for legitimate, independent reasons even if the employee had not engaged in activities protected by Section 1102.5.” (Id., § 1102.6.) The traditional McDonnell-Douglas framework does not apply, and the plaintiff is not required to rebut with evidence of pretext. (Lawson v. PPG Architectural Finishes, Inc. (2022) 12 Cal.5th 703, 712.)

            As discussed above, Plaintiff has no evidence that any adverse employment action occurred as a result of his complaints of discrimination. Therefore, there is no triable issue as to the whistleblower retaliation claim.

VI. Derivative Claims and Punitive Damages

            Because Plaintiff has failed to establish the underlying discrimination and retaliation, Defendants cannot be liable for failing to prevent discrimination and retaliation, nor is Plaintiff entitled to punitive damages. (See Trujillo v. N. Cty. Transit Dist. (1998) 63 Cal.App.4th 280, 289.) Therefore, those claims fail as a matter of law.

CONCLUSION

            Defendants’ motion for summary judgment is GRANTED.