Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-02473/USCOURTS-cand-3_05-cv-02473-1/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 28:1441 Petition for Removal - Employment Discrimination

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United States District Court

For the Northern District of California

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IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

LAWRENCE ROMANECK,

Plaintiff,

v.

DEUTSCHE ASSET MANAGEMENT,

et al.,

Defendants.

NO. C05-2473 TEH 

ORDER GRANTING IN PART

AND DENYING IN PART

MOTION TO DISMISS AND

GRANTING MOTION TO

STRIKE

This matter comes before the Court on Defendants’ motion to dismiss and strike. 

After carefully considering the parties’ written arguments, the allegations in the complaint,

and relevant case law, the Court finds oral argument to be unnecessary and hereby cancels

the motion hearing currently scheduled for Monday, September 12, 2005. With good cause

appearing, the Court now GRANTS IN PART and DENIES IN PART Defendants’ motion to

dismiss and GRANTS Defendants’ motion to strike for the reasons discussed below.

BACKGROUND

Plaintiff Lawrence Romaneck alleges the following: Romaneck worked for

Defendant Deutsche Bank as the Director of Sales for the Western Region from 1996 to

2004. During that period, Defendant Tom Winnick served as his supervisor. Romaneck

claims that Defendants used him as a scapegoat to settle claims with the Securities and

Exchange Commission (“SEC”) over market-timing allegations. The practice at issue

involves the quick buying and selling of shares in mutual funds in an attempt to profit from

short-term fluctuations in value. Defendants allegedly allowed favored investors to engage

in that practice, which is frequently prohibited because it can disadvantage ordinary

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shareholders by driving down the long-term value of the fund. Romaneck never participated

in any wrongdoing regarding market timing.

Romaneck also never received any complaints about his performance until he assisted

with the SEC investigation of Defendants’ practices regarding market timing. The SEC

commenced its investigation in 2003, and some time after that (at a time not specified in the

complaint), Romaneck produced several market-timing and securities documents to the SEC

pursuant to the SEC’s request. In March 2004, Defendants informed Romaneck that he

would be subpoenaed to testify before the SEC and the New York Attorney General’s Office. 

Defendants attempted to influence Romaneck’s testimony, but Romaneck informed

Defendants that he would tell the truth, including everything he knew about Defendants’

market-timing practices. Defendants terminated Romaneck’s employment shortly after he

refused to submit to Defendants’ pressure regarding his testimony. On May 12, 2004,

Winnick personally fired Romaneck, first stating “performance” as the reason for termination

and then changing the reason to “market timing.”

After terminating Romaneck’s employment, Defendants filed the required Form U-5,

Uniform Termination Notice for Securities Industry Registration, with the National

Association of Security Dealers (“NASD”). This form alleges the following reason for

Romaneck’s discharge:

As part of an internal review, Deutsche Bank identified a past

relationship with an investment advisory firm that traded frequently

in a small number of mutual funds, inconsistent with these funds’

registration statement policies. In connection with the ongoing

internal review, Mr. Romaneck was terminated from his position with

Deutsche Bank.

Compl. Ex. 5. Romaneck contends that Defendants know this statement, which insinuates

wrongdoing, is false but refuse to expunge it. Romaneck has been unable to obtain

employment at several different securities firms because he has been compelled to divulge

the contents of the Form U-5.

Additionally, Romaneck alleges that Defendants failed to engage in the required

interactive process and failed to accommodate him regarding a workplace injury he suffered

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on April 5, 2004. Romaneck further alleges that Defendants engaged in impermissible age

discrimination by firing him, and that Defendants failed to pay him commissions as

promised.

In all, Romaneck alleges fourteen causes of action. Defendants now move to dismiss

the second cause of action for violation of California Labor Code section 1102.5; the ninth

cause of action for intentional infliction of emotional distress; the tenth cause of action for

defamation; and the eleventh cause of action for violation of California Labor Code section

1050. Defendants also move to strike certain language from paragraph 33 of the first

amended complaint (“FAC”).

LEGAL STANDARD

I. Motion to Dismiss

Dismissal is appropriate under Federal Rule of Civil Procedure 12(b)(6) when a

plaintiff’s allegations fail “to state a claim upon which relief can be granted.” Fed. R. Civ. P.

12(b)(6). A court should not grant dismissal “unless it appears beyond doubt that the

plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” 

Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Moreover, dismissal should be with leave to

amend unless it is clear that amendment could not possibly cure the complaint’s deficiencies. 

Steckman v. Hart Brewing, Inc., 143 F.3d 1293, 1296 (9th Cir. 1998).

In deciding whether a case should be dismissed, a court may generally only consider

the complaint and any attached exhibits that have been incorporated therein. Lee v. City of

Los Angeles, 250 F.3d 668, 688 (9th Cir. 2001). However, the court may consider a

document external to the complaint if the complaint “necessarily relies” on the document and

no party contests the document’s authenticity. Parrino v. FHP, Inc., 146 F.3d 699, 706

(9th Cir. 1998). The court may also consider facts for which judicial notice is appropriate. 

Barron v. Reich, 13 F.3d 1370, 1377 (9th Cir. 1994). Thus, while the court must generally

accept as true the factual allegations of the complaint and construe those allegations in the

light most favorable to the plaintiff, the court need not “accept as true allegations that

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contradict matters properly subject to judicial notice or by exhibit.” Sprewell v. Golden State

Warriors, 266 F.3d 979, 988 (9th Cir. 2001), amended by 275 F.3d 1187 (9th Cir. 2001). 

“Nor is the court required to accept as true allegations that are merely conclusory,

unwarranted deductions of fact, or unreasonable inferences.” Id.

II. Motion to Strike

Federal Rule of Civil Procedure 12(f) permits a court to strike from the pleadings 

“any insufficient defense or any redundant, immaterial, impertinent, or scandalous matter.” 

Matter is “immaterial” if it “has no essential or important relationship to the claim for relief

or the defenses being pleaded” and “impertinent” if it “consists of statements that do not

pertain, and are not necessary, to the issues in question. Superfluous historical allegations

are a proper subject of a motion to strike.” Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527

(9th Cir. 1993) (citations omitted), rev’d on other grounds, Fogerty v. Fantasy, Inc., 510 U.S.

517 (1994). 

Motions to strike are regarded with disfavor, as they are often used as delaying tactics,

and should not be granted “unless it is clear that the matter to be stricken could have no

possible bearing on the subject matter of the litigation.” Colaprico v. Sun Microsystems,

Inc., 758 F. Supp. 1335, 1339 (N.D. Cal. 1991). “However, where the motion may have the

effect of making the trial of the action less complicated, or have the effect of otherwise

streamlining the ultimate resolution of the action, the motion to strike will be well taken.” 

California ex rel. State Lands Comm’n. v. United States, 512 F. Supp. 36, 38 (N.D. Cal.

1981) (cited with approval in Fantasy, Inc., 984 F.2d at 1528). When considering a motion

to strike, a court must view the pleadings in a light most favorable to the non-moving party. 

Id. at 39.

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In their reply, Defendants further argue that Romaneck’s contention that he produced

documents in response to the subpoena cannot support his claim because the subpoena was

issued on March 31, 2004, and Romaneck was not terminated until May 12, 2004. Although

Defendants’ argument is unclear, it appears that Defendants believe the time period between

the subpoena and the termination was too long to support an inference of a causal link

between Romaneck’s response to the subpoena and his termination. However, this is not an

issue that the Court can resolve on a motion to dismiss because the Court does not find the

inference of a causal link to be unreasonable as a matter of law.

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DISCUSSION

I. Motion to Dismiss California Labor Code Section 1102.5 Claim

California Labor Code section 1102.5(b) provides that “[a]n employer may not

retaliate against an employee for disclosing information to a government or law enforcement

agency, where the employee has reasonable cause to believe that the information discloses a

violation of state or federal statute, or violation or noncompliance with a state or federal

regulation.” Defendants argue that Romaneck has failed to state a claim under this statute

because he does not allege that he disclosed information to a government agency prior to his

termination.

Romaneck alleges that “[a]fter the SEC commenced its investigation of DEUTSCHE,

ROMANECK produced several market timing and securities documents to them for their

investigation pursuant to the SEC’s request.” FAC ¶ 20. However, as Defendants correctly

observe, this allegation does not include a date on which Romaneck allegedly produced the

documents to the SEC. Romaneck asserts in his opposition papers that he produced

documents in response to a March 2004 subpoena, but this allegation does not appear in the

complaint. In addition, because Romaneck does not dispute that he did not testify before the

SEC until after his termination, it would be an unreasonable deduction to infer that

Romaneck necessarily produced documents in response to the subpoena prior to his

termination. Instead, Romaneck must either allege an actual date on which he produced

documents to the SEC or, at a minimum, that he produced documents to the SEC prior to the

date of his termination.

Because he has failed to do so, the Court agrees with Defendants that Romaneck has

failed to allege that he engaged in protected activity prior to his termination.1

 Accordingly,

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the Court GRANTS the motion to dismiss Romaneck’s second cause of action for violation

of California Labor Code section 1102.5. Romaneck shall be given leave to amend,

however, because it appears that he may be able to cure the complaint’s deficiencies by

amendment.

II. Motion to Dismiss Intentional Infliction of Emotional Distress Claim

The elements of a cause of action for intentional infliction of emotional distress are:

“(1) extreme and outrageous conduct by the defendant with the intention of causing, or

reckless disregard of the probability of causing, emotional distress; (2) the plaintiff’s

suffering severe or extreme emotional distress; (3) and actual and proximate causation of the

emotional distress by the defendant’s outrageous conduct.” Cervantes v. J.C. Penney Co.,

24 Cal. 3d 579, 593 (1979). Defendants argue that Romaneck fails to allege the first

element, extreme and outrageous conduct, which “must be so extreme as to exceed all

bounds of that [which is] usually tolerated in a civilized society.” Id.

In his opposition, Romaneck entirely ignores the authority relied on by Defendants. 

Defendants rely primarily on Janken v. GM Hughes Electronics, 46 Cal. App. 4th 55, 80

(1996), where the court held that “[m]anaging personnel is not outrageous conduct beyond

the bounds of human decency, but rather conduct essential to the welfare and prosperity of

society. A simple pleading of personnel management activity is insufficient to support a

claim of intentional infliction of emotional distress, even if improper motivation is alleged.” 

Instead, “[i]f personnel management decisions are improperly motivated, the remedy is a suit

against the employer for discrimination.” Id. Other courts have followed Janken to hold that

termination for discriminatory or other improper reasons is insufficient to rise to the level of

outrageous conduct required for an intentional infliction of emotional distress claim. E.g.,

Walker v. Boeing Corp., 218 F. Supp. 2d 1177, 1186 (C.D. Cal. 2002) (“Terminating an

employee for improper or discriminatory reasons, like many other adverse personnel

management decisions, is insufficiently extreme or outrageous to give rise to a claim for

intentional infliction of emotional distress.”); Bartalini v. Blockbuster Entm’t, Inc., No. C-98-

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Wallis was overruled on other grounds by Foley v. Interactive Data Corp., 47 Cal. 3d

654 (1988), a case that also disagreed with Huber on other grounds.

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3943-SC, 1999 WL 1012383, at *10 (N.D. Cal. Nov. 8, 1999) (“[C]ourts have generally

refused to extend liability for emotional distress to terminations based upon discriminatory

motives unless accompanied by aggravating factors, such as racial or ethnic slurs. . . . 

Moreover, even if [plaintiff] had shown that his termination was in fact motivated [by

discriminatory] animus, such action is not per se outrageous.”); see also Helgeson v. Am.

Int’l Group, Inc., 44 F. Supp. 2d 1091, 1095 (S.D. Cal. 1999) (“Performance reviews,

counseling sessions, lay-off decisions, and work assignments are all decisions that businesses

make every day. . . . Even if these decisions were improperly motivated, they fall far short of

the necessary standard of outrageous conduct beyond all bounds of decency.”). Romaneck

fails to address any of these cases in his opposition. Similarly, Romaneck ignores

Defendants’ argument that “[d]efamatory accusations are insufficient to give rise to an action

for intentional infliction of emotional distress.” Walker, 218 F. Supp. 2d at 1184 (citing

Alcorn v. Anbro Eng’g, Inc., 2 Cal. 3d 493, 499 n.5, (1970); Agostini v. Strycula, 231 Cal.

App. 2d 804, 806-09 (1965); Perati v. Atkinson, 213 Cal. App. 2d 472, 473-74 (1963)).

Romaneck does not attempt to distinguish any of the above cases and instead relies

solely on two older cases: Wallis v. Superior Court, 160 Cal. App. 3d 1109 (1984), and

Huber v. Standard Insurance Co., 841 F.2d 980, 987 (9th Cir. 1988).2

 However, in addition

to predating the above line of cases, both of these cases are also factually distinguishable. In

Wallis, the employer breached its obligation to pay an agreed upon stipend for Wallis’s

agreement not to compete, and Wallis asserted, among other claims, a claim for intentional

infliction of emotional distress based on that breach. Wallis, 160 Cal. App. 3d at 1113. The

California appellate court reversed the trial court’s grant of a demurrer on Wallis’s

intentional infliction of emotional distress claim. Id. at 1120. Although, like Wallis,

Romaneck also alleges that Defendants breached a contract regarding payment (in this case,

of commissions), Romaneck fails to allege the sort of financial vulnerability, and the

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employer’s knowledge of such vulnerability, alleged by Wallis and relied upon by the court

of appeal in its holding. Id. 

Similarly, in Huber, the employee was not allowed to stay on until his pension vested,

contrary to standard policy, and he was also told to vacate his office in one day even though

his termination was not effective for thirty days. Huber, 841 F.2d at 987. In addition,

Huber’s employer voluntarily memorialized the purported reasons for his termination in a

letter, thereby leaving a record for future employers. Id. Here, there are no allegations that

Romaneck’s termination violated company policy. Moreover, although Defendants did file a

Form U-5 with the NASD, Romaneck does not dispute that this was a required filing rather

than the voluntary paper trail created in Huber.

In light of all of the above, the Court finds that Romaneck has failed to rebut

Defendants’ arguments that the alleged defamatory statements, the change in Defendants’

commissions policy, Defendants’ alleged failure to accommodate and engage in the

interactive process, and Romaneck’s termination, even if in violation of public policy, do not

rise to the level of outrageous conduct required to state a claim for intentional infliction of

emotional distress. Thus, Romaneck cannot base his intentional infliction of emotional

distress claim on any of these allegations.

However, Defendants have failed to persuade the Court that it would be impossible

for Romaneck to prove that Defendants’ alleged conduct in pressuring Romaneck to testify a

certain way and, if Romaneck’s allegations are to be believed, to lie under oath, constitutes

outrageous conduct. Likewise, the Court cannot say that Defendants’ alleged attempt to use

Romaneck as a scapegoat does not, as a matter of law, constitute outrageous conduct. 

Indeed, that sort of conduct falls outside regular management decisions and, depending on

what Romaneck proves at trial, may be the sort of behavior that could lead an average

member of the community to resent Defendants and exclaim, “Outrageous!” See KOVR-TV,

Inc. v. Superior Court, 31 Cal. App. 4th 1023, 1028 (1995) (citing Restatement (Second) of

Torts § 46 cmt. d) (“Generally, conduct will be found to be actionable [on an intentional

infliction of emotional distress claim] where the ‘recitation of the facts to an average member

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of the community would arouse his resentment against the actor, and lead him to exclaim,

“Outrageous!”’”). Accordingly, although Romaneck may not recover for intentional

infliction of emotional distress for all of Defendants’ alleged conduct, some of Romaneck’s

allegations are sufficient to withstand a motion to dismiss. Defendants’ motion to dismiss

Romaneck’s ninth cause of action for intentional infliction of emotional distress is therefore

DENIED.

III. Motion to Dismiss Defamation Claim

Defamation requires a false and unprivileged publication. Cal. Civ. Code §§ 44-46. 

The publication must be of a false statement of fact, as opposed to a statement of opinion. 

Gregory v. McDonnell Douglas Corp., 17 Cal. 3d 596, 600 (1976).

Defendants correctly argue that the Form U-5 filed by Defendants with the NASD

cannot form the basis for Romaneck’s defamation claim because it is privileged. As a

California appellate court recently held, “a Form U-5 filed with the NASD can be a precursor

to an investigation. Consequently, it is protected from a suit for defamation under Civil Code

section 47, subdivision (b).” Fontani v. Wells Fargo Inv., LLC, 129 Cal. App. 4th 719,

734-35 (2005); see Cal. Civ. Code § 47(b) (providing that, with certain exceptions not

applicable here, a publication is privileged if it is made in a judicial, legislative, or other

official proceeding). Romaneck argues that the privilege under section 47(b) is a “liability

privilege” and not an “evidentiary privilege.” Opp’n at 6. However, this only supports

Defendants’ argument that the statements in the Form U-5 cannot form the basis for liability

for defamation. The case relied on by Romaneck stands only for the proposition that

privileged statements may be admissible to show motive or intent for an abuse of process

claim or other claim that is not “predicated on a judicial statement or publication itself,” not

that they may support a claim for defamation. Oren Royal Oaks Venture v. Greenberg,

Bernhard, Weiss & Karma, Inc., 42 Cal. 3d 1157, 1168 (1986).

 Indeed, Romaneck apparently concedes that the Form U-5 itself cannot form the basis

for liability and instead argues that other false and defamatory statements that “are entirely

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separate from the U5 form . . . create the basis for actionable defamation.” Opp’n at 6. In

particular, the complaint alleges that, when Romaneck was terminated, Defendant Winnick

falsely stated that the reason for his termination was “performance” and then “market

timing.” FAC ¶ 26.

The Court finds the alleged statement that Romaneck was terminated for

“performance” to be too vague to support a claim for defamation. Performance evaluations

generally contain only statements of opinion and not fact. Jensen v. Hewlett-Packard Co.,

14 Cal. App. 4th 958, 966, 970-71 (1993) (statements in written evaluation that employee

“had been the subject of some third party complaints, was not carrying his weight, had a

negative attitude in dealing with others, evidenced a lack of direction in his project activities

and was unwilling to take responsibility for the projects he oversaw” were not actionable

statements of fact). Therefore, if Romaneck’s allegation is only that Defendants stated he

was terminated for poor performance, that statement is not actionable because it is a

statement of opinion. However, if Defendants made actual statements of fact that could be

disproved – for example, that Romaneck improperly engaged in market timing practices on a

particular case or with a particular client – then it is possible that Romaneck may be able to

state a defamation claim based on comments about his performance. While Romaneck need

not allege the exact words or circumstances forming the basis of his defamation claim, he

needs at least to allege the substance of the allegedly defamatory statements; general

allegations will not suffice. Silicon Knights, Inc. v. Crystal Dynamics, Inc., 983 F. Supp.

1303, 1314 (N.D. Cal. 1997).

Defendants next argue that their alleged statement that Romaneck was terminated for

engaging in market timing cannot give rise to defamation liability because, as a statement

bearing some relation to the privileged Form U-5, the statement is privileged under

California Civil Code section 47(b). This argument is not persuasive. California law is clear

that the privilege under section 47(b) extends to statements made in preparation for an

official proceeding or investigation. Rubin v. Green, 4 Cal. 4th 1187, 1194-95 (1993). 

However, Defendants attempt to extend this proposition too broadly. The Form U-5 is

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privileged only because it was potentially made in preparation for an official proceeding by

the NASD. Fontani, 129 Cal. App. 4th at 734-35. That is, the Form U-5 itself does not

constitute an official proceeding, and Defendants have not persuaded the Court that

statements related to that form, which itself is one step removed from an official proceeding,

are protected. 

Nor has Defendants’ two-sentence argument persuaded the Court that the alleged

“market timing” statement is conditionally privileged under California Civil Code section

47(c). Defendants fail to explain how section 47(c) applies to this case, but, even if it did

apply, the Court finds that Romaneck has sufficiently alleged malice to overcome the

privilege. Cal. Civ. Code § 47(c) (providing that a publication is privileged if made “[i]n 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”). Read in a light most

favorable to Romaneck and assumed to be true, the factual allegations are sufficient to

support a finding that Defendants “entertained toward [Romaneck] a feeling of hatred or ill

will . . . going beyond that which the occasion apparently justifies . . . and different from that

which prima facie rendered the communication privileged, and being a motive contrary to

good morals.” Everett v. Cal. Teachers Ass’n, 208 Cal. App. 2d 291, 295 (1962) (citations

omitted) (defining what plaintiff must allege and prove to overcome the qualified privilege

under section 47(c)).

In short, the Court does not find dismissal of Romaneck’s defamation claim to be

appropriate. Romaneck may not claim defamation based on statements contained in the

privileged Form U-5, nor may he assert a defamation claim based on a vague statement that

he was terminated for performance. However, Romaneck may base a defamation claim on

the statement that he was terminated because he engaged in market-timing practices. Thus,

with good cause appearing, the Court DENIES Defendants’ motion to dismiss Romaneck’s

tenth cause of action for defamation.

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IV. Motion to Dismiss California Labor Code Section 1050 Claim

California Labor Code section 1050 provides that “[a]ny person, or agent or officer

thereof, who, after having discharged an employee from the service of such person or after an

employee has voluntarily left such service, by any misrepresentation prevents or attempts to

prevent the former employee from obtaining employment, is guilty of a misdemeanor.” 

Section 1054 provides that civil penalties may be sought for a violation of section 1050. 

Section 1050 “applies only to misrepresentations made to prospective employers other than

the defendant. It does not apply to misrepresentations made by employees of the defendant

to other of the defendant’s employees.” Kelly v. Gen. Tel. Co., 136 Cal. App. 3d 278, 288-89

(1982).

Defendants argue that Romaneck fails to state a claim under section 1050 because the

only statement allegedly giving rise to liability is the Form U-5, which cannot form the basis

for liability because it is absolutely privileged. In his opposition, Romaneck counters that his

section 1050 claim “is not based purely on absolutely privileged statements . . . because

additional and separate statements were made outside of defendants’ U5 Form actions.” 

Opp’n at 8. However, none of the statements identified by Romaneck were made by

Defendants to prospective employers. Accordingly, the Court GRANTS Defendants’ motion

to dismiss Romaneck’s eleventh cause of action for violation of California Labor Code

section 1050. Dismissal is without prejudice because it is not clear that Romaneck could not

allege a cause of action if given leave to amend.

V. Motion to Strike

Finally, Defendants seek to strike references to 42 U.S.C. § 1985(2) and California

Labor Code section 1102.5 from paragraph 33 of the amended complaint. Romaneck does

not dispute striking 42 U.S.C. § 1985(2) from the complaint and, instead, seeks leave to

amend the complaint to cite 18 U.S.C. § 1514A in place of 42 U.S.C. § 1985(2). The motion

to strike reference to 42 U.S.C. § 1985(2) is therefore GRANTED as unopposed. The Court

agrees with Defendants that no leave to amend to cite 18 U.S.C. § 1514A is necessary

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because paragraph 33 already alleges violation of public policy by violating the SarbanesOxley Act of 2002, of which 18 U.S.C. § 1514A is a part.

Because the Court dismissed Romaneck’s section 1102.5 claim, the Court also

GRANTS the motion to strike reference to section 1102.5 in Romaneck’s claim for wrongful

termination in violation of public policy. However, if Romaneck can sufficiently state a

claim under section 1102.5 in his second amended complaint, then he need not strike

reference to that code section in the disputed paragraph.

CONCLUSION

For all of the above reasons, the Court finds good cause to GRANT IN PART and

DENY IN PART Defendants’ motion to dismiss and to GRANT Defendants’ motion to

strike. Romaneck is given leave to amend his second cause of action for violation of

California Labor Code section 1102.5 and his eleventh cause of action for violation of

California Labor Code section 1050. Romaneck may also amend his tenth cause of action for

defamation to clarify the allegedly defamatory statement regarding his termination for

“performance.” Romaneck shall file his second amended complaint on or before Friday,

September 30, 2005. Failure to file an amended complaint by that date shall result in

dismissal with prejudice of the claims on which leave to amend was granted.

IT IS SO ORDERED.

DATED 09/06/05 

THELTON E. HENDERSON, JUDGE

UNITED STATES DISTRICT COURT

Case 3:05-cv-02473-TEH Document 16 Filed 09/06/05 Page 13 of 13