Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_12-cv-00821/USCOURTS-caed-1_12-cv-00821-6/pdf.json

Nature of Suit Code: 320
Nature of Suit: Assault, Libel, and Slander
Cause of Action: 28:1441 Petition for Removal - Libel, Assault, Slander

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IN THE UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF CALIFORNIA

TROY JACQUES, CASE NO. CV F 12-0821 LJO DLB 

Plaintiff, ORDER ON DEFENDANT BANK OF

AMERICA’S F.R.Civ.P. 12 MOTION TO

vs. DISMISS 

(Doc. 26.)

BANK OF AMERICA CORPORATION,

Defendant.

 /

INTRODUCTION

Defendant Bank of America, N.A. (“B of A”) seeks to dismiss plaintiff Troy Jacques (“Mr.

Jacques’”) defamation claim as privileged and lacking facts to support malice. Mr. Jacques responds

that he adequately alleges malice to withstand B of A’s privilege assertion and dismissal. This Court

considered B of A’s F.R.Civ.P. 12(b)(6) motion to dismiss on the record and VACATES the November

13, 2012 hearing, pursuant to Local Rule 230(g). For the reasons discussed below, this Court

DISMISSES with leave to amend Mr. Jacques’ defamation claim.

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BACKGROUND1

Mr. Jacques’ Employment

B of A employed Mr. Jacques during 2005-2009. In October 2009, Mr. Jacques commenced

employment with Wells Fargo.

On February 2, 2011, Wells Fargo ordered from First Advantage Background Services Corp.

(“First Advantage”) Mr. Jacques’ consumer report and received it on February 24, 2011. The consumer

report attributes to B of A claims of an “internal fraud match” occurring on September 29, 2008 with

an assessed “severity” of 100.

On April 8, 2011, Mr. Jacques received from Wells Fargo a “Pre-Adverse Action Notification”

that a decision concerning Mr. Jacques’ continued Wells Fargo employment was pending review of the

consumer report, which was included in the correspondence to Mr. Jacques. Mr. Jacques requested his

personnel file from B of A, and the file lacked “any documents pertaining to the alleged investigation.” 

On April 15, 2011, Wells Fargo notified Mr. Jacques of his termination due to the consumer report. Mr.

Jacques claims his “attempts to remove defamatory statements from the consumer report have been

futile.”

Mr. Jacques’ Claims

The AC alleges that:

1. Mr. Jacques was not informed of a B of A investigation until Mr. Jacques resigned from

B of A to join Wells Fargo;

2. Mr. Jacques was provided no explanation or details of the B of A’s investigation and no

opportunity to review or contest preliminary findings;

3. Mr. Jacques did not learn of B of A’s finalization of preliminary findings “until he had

been employed by Wells Fargo for some time”; and

4. B of A retaliated against Mr. Jacques for his acceptance of employment with Wells

Fargo.

The AC alleges a sole defamation claim that B of A “made statements about Plaintiff of a false

The factual recitation is derived generally from Mr. Jacques’ Amended Complaint for Damages for

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Defamation (“AC”), the target to B of A’s challenges.

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and defamatory nature and in a malicious manner, thereby disparaging Plaintiff and preventing Plaintiff

from engaging in his professional capacity at Wells Fargo and elsewhere and which caused Plaintiff to

be terminated from Wells Fargo.” To support malice, the AC alleges that B of A’s denial to contest

preliminary fraud findings “constitutes a purposeful, reckless and wanton avoidance of the truth, or the

product of a deliberate decision not to acquire knowledge of facts that might confirm the probable falsity

of the subject charges.” The AC claims injury to Mr. Jacques’ reputation.

DISCUSSION

F.R.Civ.P. 12(b)(6) Motion To Dismiss Standards

B of A seeks to dismiss Mr. Jacques’ defamation claim as privileged under California Civil Code

section 47(c) (“section 47(c)”) and as lacking facts to support B of A’s malice.

“When a federal court reviews the sufficiency of a complaint, before the reception of any

evidence either by affidavit or admissions, its task is necessarily a limited one. The issue is not whether

a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the

claims.” Scheurer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683 (1974); Gilligan v. Jamco Development

Corp., 108 F.3d 246, 249 (9 Cir. 1997). A F.R.Civ.P. 12(b)(6) dismissal is proper where there is either th

a “lack of a cognizable legal theory” or “the absence of sufficient facts alleged under a cognizable legal

theory.” Balisteri v. Pacifica Police Dept., 901 F.2d 696, 699 (9 Cir. 1990); Graehling v. Village of th

Lombard, Ill., 58 F.3d 295, 297 (7 Cir. 1995). A F.R.Civ.P. 12(b)(6) motion “tests the legal sufficiency th

of a claim.” Navarro v. Block, 250 F.3d 729, 732 (9 Cir. 2001). th

In addressing dismissal, a court must: (1) construe the complaint in the light most favorable to

the plaintiff; (2) accept all well-pleaded factual allegations as true; and (3) determine whether plaintiff

can prove any set of facts to support a claim that would merit relief. Cahill v. Liberty Mut. Ins. Co., 80

F.3d 336, 337-338 (9th Cir. 1996). Nonetheless, a court is not required “to accept as true allegations that

are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” In re Gilead

Sciences Securities Litig., 536 F.3d 1049, 1055 (9 Cir. 2008) (citation omitted). A court “need not th

assume the truth of legal conclusions cast in the form of factual allegations,” U.S. ex rel. Chunie v.

Ringrose, 788 F.2d 638, 643, n. 2 (9 Cir.1986), and must not “assume that the [plaintiff] can prove facts th

that it has not alleged or that the defendants have violated . . . laws in ways that have not been alleged.” 

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Associated General Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S.

519, 526, 103 S.Ct. 897 (1983). A court need not permit an attempt to amend if “it is clear that the

complaint could not be saved by an amendment.” Livid Holdings Ltd. v. Salomon Smith Barney, Inc.,

416 F.3d 940, 946 (9 Cir. 2005). th

A plaintiff is obliged “to provide the ‘grounds’ of his ‘entitlement to relief’ [which] requires

more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not

do.” Bell Atl. Corp. v. Twombly, 550 U.S. 554,127 S. Ct. 1955, 1964-65 (2007) (internal citations

omitted). Moreover, a court “will dismiss any claim that, even when construed in the light most

favorable to plaintiff, fails to plead sufficiently all required elements of a cause of action.” Student Loan

Marketing Ass'n v. Hanes, 181 F.R.D. 629, 634 (S.D. Cal. 1998). In practice, a complaint “must contain

either direct or inferential allegations respecting all the material elements necessary to sustain recovery

under some viable legal theory.” Twombly, 550 U.S. at 562, 127 S.Ct. at 1969 (quoting Car Carriers,

Inc. v. Ford Motor Co., 745 F.2d 1101, 1106 (7 Cir. 1984)). th

In Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937,1949 (2009), the U.S. Supreme Court

explained:

. . . a complaint must contain sufficient factual matter, accepted as true, to “state

a claim to relief that is plausible on its face.” . . . A claim has facial plausibility when the

plaintiff pleads factual content that allows the court to draw the reasonable inference that

the defendant is liable for the misconduct alleged. . . . The plausibility standard is not

akin to a “probability requirement,” but it asks for more than a sheer possibility that a

defendant has acted unlawfully. (Citations omitted.) 

After discussing Iqbal, the Ninth Circuit summarized: “In sum, for a complaint to survive

[dismissal], the non-conclusory ‘factual content,’ and reasonable inferences from that content, must be

plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v. U.S. Secret Service, 572 F.3d

962, 989 (9 Cir. 2009) (quoting Iqbal, 556 U.S. 662, 129 S.Ct. at 1949). th

The U.S. Supreme Court applies a “two-prong approach” to address dismissal:

First, the tenet that a court must accept as true all of the allegations contained in

a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of

a cause of action, supported by mere conclusory statements, do not suffice. . . . Second,

only a complaint that states a plausible claim for relief survives a motion to dismiss. . .

. Determining whether a complaint states a plausible claim for relief will . . . be a

context-specific task that requires the reviewing court to draw on its judicial experience

and common sense. . . . But where the well-pleaded facts do not permit the court to infer

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more than the mere possibility of misconduct, the complaint has alleged – but it has not

“show[n]”-“that the pleader is entitled to relief.” Fed. Rule Civ. Proc. 8(a)(2).

In keeping with these principles a court considering a motion to dismiss can

choose to begin by identifying pleadings that, because theyare no more than conclusions,

are not entitled to the assumption of truth. While legal conclusions can provide the

framework of a complaint, theymust be supported by factual allegations. When there are

well-pleaded factual allegations, a court should assume their veracity and then determine

whether they plausibly give rise to an entitlement to relief.

Iqbal, 556 U.S. 662, 129 S.Ct. at 1949-1950.

Moreover, “a complaint maybe dismissed under Rule 12(b)(6) when its own allegations indicate

the existence of an affirmative defense.” Quiller v. Barclays American/Credit, Inc., 727 F.2d 1067, 1069

(11 Cir. 1984). th

With these standards in mind, this Court turns to B of A’s challenges to the AC’s defamation

claim.

Privileged Communication

B of A asserts the section 47(c) privilege as a defense to the AC’s defamation claim.

“The tort of defamation involves (a) a publication that is (b) false, (c) defamatory, and (d)

unprivileged, and that (e) has a natural tendency to injure or that causes special damage.” Taus v. Loftus,

40 Cal.4th 683, 720, 151 P.3d 1185 (2007) (internal quotations and citations omitted).

Section 47(c) subjects to privilege:

. . . a communication, without malice, to a person interested therein, (1) by one

who is also interested, or (2) by one who stands in such a relation to the person interested

as to afford a reasonable ground for supposing the motive for the communication to be

innocent, or (3) who is requested by the person interested to give the information. This

subdivision applies to and includes a communication concerning the job performance or

qualifications of an applicant for employment, based upon credible evidence, made

without malice, by a current or former employer of the applicant to, and upon request of,

one whom the employer reasonably believes is a prospective employer of the applicant.

This subdivision authorizes a current or former employer, or the employer's agent, to

answer whether or not the employer would rehire a current or former employee. 

“Thus, if malice is shown, the privilege is not merely overcome; it never arises in the first

instance.” Brown v. Kelly Broadcasting Co., 48 Cal.3d 711, 723, n. 7, 257 Cal.Rptr. 708 (1989).

B of A notes that the AC attributes to B of A only a February 2011communication to First

Advantage in response to Wells Fargo’s request for a consumer report. B of A characterizes its

communication as privileged in that it is “of mutual interest” to Wells Fargo and addresses Mr. Jacques’

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job performance.

B of A further attacks absence of malice in connection with B of A’s October 2009 fraud

investigation and its alleged February 2011 defamatory statement. B of A points to AC allegations that

Mr. Jacques learned of B of A’s investigation when Mr. Jacques resigned. B of A argues that “the

allegations of malice [are] unconnected to the communication at issue” and “the facts supporting the

malice allegation are simply too tenuous to support a claim that the Bank acted with malice as to a

communication over a year later.” B of A concludes that the “allegations of malice pre-date the

publication at issue by over a year.” B of A argues that the AC “tries to reach back in time to include 2

alleged improper conduct during an internal investigation and as to investigation results, that occurred

over a year before the alleged communication.” 

The parties agree that the section 47(c) privilege is conditioned on an absence of malice. To

support malice, Mr. Jacques focuses on B of A’s “refusal to permit Plaintiff an opportunity to review

or contest the preliminary findings” and “the minimal or non-existent documentation revealed in

Plaintiff’s employee file” despite an “internal fraud match” with an assessed “severity” of 100. Mr.

Jacques concludes that the AC’s “specific facts” support “a preliminary finding of malice” to overcome

dismissal.

The gist of the AC’s malice claim is that B of A’s investigation was so inadequate that it greatly

colored or exaggerated the fraud finding. Malice may arise when “failure to investigate” is fairly

characterized as “the purposeful avoidance of the truth or the product of a deliberate decision not to

acquire knowledge of facts that might confirm the probable falsity of the subject charges.” Rosenaur

v. Scherer, 88 Cal.App.4th 260, 277, 105 Cal.Rptr.2d 674 (2001) (internal quotations omitted). 

However, malice “ is not measured by whether a reasonably prudent man would have published, or

would have investigated before publishing. There must be sufficient evidence to permit the conclusion

that the defendant in fact entertained serious doubts as to the truth of his publication. Lack of due care

is not the measure of liability, nor is gross or even extreme negligence.” McCoy v. Hearst Corp., 42

Cal.3d 835, 860, 231 Cal.Rptr. 518 (1986) (internal quotations and citation omitted). Thus “mere failure

To the extent B of A argues a limitations time bar, the AC sufficiently alleges the timeliness of the

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defamation claim.

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to investigate the truthfulness of a statement, even when a reasonably prudent person would have done

so, is insufficient” for malice. Annette F. v. Sharon S., 119 Cal.App.4th 1146,1169, 15 Cal.Rptr.3d 100

(2004).

The AC fails to allege sufficient facts to support malice. The AC lacks facts that B of A

purposefully avoided the truth or deliberately decided not to acquire facts to confirm probable falsity. 

The AC alleges no facts that B of A entertained serious doubts or exaggerated information as to Mr.

Jacques’ consumer report. The AC rests on allegations which raise inferences that B of A withheld

information until the request for Mr. Jacques’ consumer report and prevented Mr. Jacques to contest B

of A’s preliminary findings. Such inferences fail to satisfy malice. In the absence of sufficient facts of

malice, B of A is entitled to rely on the section 47(c) privilege. Nonetheless, in an abundance of caution,

this Court grants Mr. Jacques a final chance to allege facts to support requisite malice to avoid the

section 47(c) privilege.

CONCLUSION AND ORDER

For the reasons discussed above, this Court:

1. DISMISSES the AC with leave to amend; 

2. ORDERS Mr. Jacques, no later than November 21, 2012, to file and serve either: (a) a

further amended complaint to cure the deficiencies in the defamation claim; or (b) a

statement that Mr. Jacques elects not to attempt to file a further amended complaint to

entitle this Court to enter judgment;

3. ORDERS B of A, no later than December 14, 2012, to file a response to Mr. Jacques’

further amended complaint as necessary. 

IT IS SO ORDERED.

Dated: November 7, 2012 /s/ Lawrence J. O'Neill 

66h44d UNITED STATES DISTRICT JUDGE

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