Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_05-cv-02877/USCOURTS-cand-3_05-cv-02877-2/pdf.json

Nature of Suit Code: 445
Nature of Suit: Americans with Disabilities Act - Employment
Cause of Action: 42:12101 Americans w/ Disabilities Act (ADA)

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

MICHAEL JAMES SMITH,

Plaintiff,

v

SEIU UNITED HEALTHCARE WORKERS

WEST (HEALTHCARE WORKERS UNION

SEIU LOCAL 250) and SAL ROSELLI,

Defendants. /

No C 05-2877 VRW

ORDER

SEIU United Healthcare Workers West (“Local 250”) and Sal

Roselli (collectively “defendants”) move pursuant to FRCP 12(b)(6)

to dismiss the second amended complaint, Doc #29 (SAC), filed by

plaintiff Michael James Smith, which alleges federal claims for

retaliation as well as supplemental claims for relief. Doc #32. 

Defendants also move to strike paragraph 8 of the SAC pursuant to

FRCP 12(f). As explained below, defendants’ motion to strike is

DENIED and defendants’ motion to dismiss is GRANTED IN PART and

DENIED IN PART.

//

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I

The following facts are taken as true for purposes of the

present motion: 

Smith was employed for 18 years by Local 250 as a frontline labor representative. SAC ¶5. Roselli was the president of

Local 250 and one of Smith’s supervisors. Id ¶6. 

On May 23, 2002, Smith filed a complaint in this court,

against Local 250 and Roselli, Michael James Smith v Healthcare

Workers Union SEIU Local 250, Sal Roselli, Joan Emslie, and Will

Clayton, No C-02-2508-JSW, asserting claims for age and disability 

discrimination under the Americans with Disabilities Act (ADA), 42

USC § 12101 et seq, the Age Discrimination in Employment Act

(ADEA), 29 USC § 621 et seq, the Family Medical Leave Act (FMLA),

29 USC § 2601 et seq and the California Fair Employment and Housing

Act (FEHA), Cal Gov’t Code § 12900 et seq. Id ¶¶7, 17, 22, 27. 

While the suit was pending, Local 250 employees repeatedly

prevented Smith from speaking at various functions and publicized

his status as an opposing litigant. Id ¶8. On June 3, 2003, the

parties settled all claims that had accrued as of that date, and

Judge White dismissed the action on September 17, 2003. Id.

After Smith left his job at Local 250, SEIU Local 707,

another healthcare workers’ union, hired Smith as a consultant. In

that capacity, Smith attended a business meeting on July 19, 2003,

at a Marriot hotel in Oakland. At that meeting, Local 250 employee

Ralph Cornejo accosted Smith, commanding him in a loud voice to

“get the f**k out of here.” Id ¶9. Another Local 250 employee

conferred with Roselli, who was not at the scene, and received

authorization from him to force Smith to leave. Two security

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guards were summoned, who in turn called the Oakland police

department, upon whose arrival Smith left the scene. Hundreds of

representatives from various labor organizations attending the

meeting witnessed the incident. Id. 

Apparently in response to this incident, on September 5,

2003, Smith’s superior wrote a letter to the international

president of SEIU, the parent organization of both Local 707 and

Local 250, asking the organization to direct Local 250 not to

interfere with Smith’s work. Id ¶10. Then Roselli wrote an

unsolicited letter to the international president, which contained

allegedly defamatory remarks about Smith. Id. On November 12,

2003, Smith filed an EEOC complaint against defendants for

retaliation, which included a copy of this letter. Id ¶38. 

In response to Roselli’s letter, Smith’s superior wrote

the international president again and affirmed his support of

Smith, but also stating his intention to limit Smith’s

participation in certain work involving contact with Local 250

because of Roselli’s strong opposition to Smith. Id ¶11. Smith

was subsequently removed from a large project on which he had been

working for two years, and after Smith completed his contract with

Local 707, the union did not offer Smith any further employment. 

Id ¶12. Since then, Smith has remained unemployed despite repeated

applications to potential employers in the labor union community. 

Id ¶13. 

On July 14, 2005, Smith filed the instant action against

Local 250 and Roselli alleging retaliation in violations of the

ADA, ADEA, FMLA and FEHA. Doc #1. Smith also alleged supplemental

claims for defamation, interference with prospective business

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advantage, intentional infliction of emotional distress and

blacklisting in violation of California Labor Code sections 1050,

1052 and 1054. Id. On December 1, 2005, the court dismissed

Smith’s first amended complaint in its entirety due to noncompliance with FRCP 8. See Doc #28. Smith timely filed the SAC.

II

The court finds it appropriate first to address

defendants’ motion to strike paragraph 8.

A

Under FRCP 12(f), a court “may order stricken from any

pleading * * * any redundant, immaterial, impertinent, or

scandalous matter.” Immaterial matters have “no essential or

important relationship to the claim for relief.” Fantasy, Inc v

Fogerty, 984 F2d 1524, 1527 (9th Cir 1993), rev’d on other grounds,

510 US 517, 534-35 (1994). Impertinent matters consist of

“statements that do not pertain, and are not necessary, to the

issues in question.” Id (internal quotations omitted). 

“Superfluous historical allegations are a proper subject of a

motion to strike.” Id.

Motions to strike are disfavored 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 (ND Cal

1991). When a court considers a motion to strike, it “must view

the pleading in a light most favorable to the pleading party.” In

re 2TheMart.com, Inc Securities Litig, 114 F Supp 2d 955, 965 (CD

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Cal 2000). A court must deny the motion to strike if there is any

doubt whether the allegations in the pleadings might be relevant in

the action. Id. “Evidentiary allegations are not usually proper

pleading, but allegations supplying background or historical

material or other matters of an evidentiary nature will not be

stricken unless unduly prejudicial to defendant.” LeDuc v Kentucky

Life Ins Co, 814 F Supp 820, 830 (ND Cal 1992).

B

Defendants move to strike paragraph 8 of the SAC on the

ground that it alleges conduct that occurred prior to the

settlement agreement in the earlier litigation. Because all claims

arising from such conduct were extinguished by that settlement,

paragraph 8 is, according to defendants, immaterial. Defendants

further argue that paragraph 8 is prejudicial. 

Smith contends that paragraph 8 “describe[s] the

beginning of a course of conduct that continues to this day” and is

“necessary to an understanding of the events which followed

settlement.” Doc #44 at 24. Smith relies upon National Railraod

Passenger Corp v Morgan, 536 US 101, 113 (2002), in which the

Supreme Court stated that discrete acts of discrimination, although

not the subject of a timely filed EEOC complaint, could still be

used as “background evidence in support of a timely claim.” 

Defendants distinguish Morgan, which addressed facts

underlying time-barred claims, from this case, which involves facts

underlying claims the parties have agreed not to litigate. Perhaps

the distinction is significant; perhaps not. Regardless, and

without deciding, whether defendants’ evidence of pre-settlement

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conduct might be admissible “background evidence,” the fact remains

that Smith cannot base any of the claims asserted in the SAC upon

conduct covered by the settlement agreement so long as that

agreement is in force. For in that circumstance, the claim would

have arisen prior to execution of, and would therefore have been

extinguished by, the settlement agreement. But the court finds it

unnecessary to strike paragraph 8 in order to give meaning to the

settlement agreement. Defendants’ motion to strike is therefore

DENIED.

Still, the court will remark that defendants’ motion to

strike was well-taken given that the SAC utterly fails to comply

with FRCP 8, which requires that complaints contain nothing more

than a short, plain statement of the claims and supporting

allegations. Indeed, the court dismissed the first amended

complaint in its entirety for precisely this reason. Yet the same

rococo detail remains in the SAC. Counsel’s penchant for verbosity

is further evidenced by Smith’s opposition to defendants’ motions,

Doc #44, which exceeds the 25-page limit imposed by the local

rules. See Civ L R 7-3(a). Had plaintiff’s counsel refrained from

the jabs at opposing counsel, numerous as they were pointless, the

court has no doubt that Smith’s opposition would have complied with

the local rules. 

III

Rule 12(b)(6) motions to dismiss essentially “test

whether a cognizable claim has been pleaded in the complaint.” 

Scheid v Fanny Farmer Candy Shops, Inc, 859 F2d 434, 436 (6th Cir

1988). Although a plaintiff is not held to a “heightened pleading

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standard,” the plaintiff must provide more than mere “conclusory

allegations.” Swierkiewicz v Sorema NA, 534 US 506, 515 (2002)

(rejecting heightened pleading standards); Schmier v United States

Court of Appeals for the Ninth Circuit, 279 F3d 817, 820 (9th Cir

2002) (rejecting conclusory allegations).

Under Rule 12(b)(6), a complaint “should not be dismissed

for failure to state a claim 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.” Hughes v Rowe, 449 US 5, 9

(1980) (citing Haines v Kerner, 404 US 519, 520 (1972)); see also

Parks School of Business, Inc v Symington, 51 F3d 1480, 1484 (9th

Cir 1985). All material allegations in the complaint must be taken

as true and construed in the light most favorable to plaintiff. 

See Gompper v VISX, Inc, 298 F3d 893, 895 (9th Cir 2002). But “the

court [is not] required to accept as true allegations that are

merely conclusory, unwarranted deductions of fact, or unreasonable

inferences.” Sprewell v Golden State Warriors, 266 F3d 979, 988

(9th Cir 2001) (citing Clegg v Cult Awareness Network, 18 F3d 752,

754-55 (9th Cir 1994)).

IV

Federal Claims

To establish a prima facie case of retaliation under the

ADA, ADEA and FMLA, Smith must show that: (1) he engaged in a

protected activity, (2) suffered an adverse employment action and

(3) there was a causal link between the two. Pardi v Kaiser

Permanente Hosp, Inc, 389 F3d 840, 849 (9th Cir 2004) (ADA); O’Day

v McDonnell Douglas Helicopter Co, 79 F3d 756, 763 (9th Cir 1996)

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(ADEA); Washington v Fort James Operating Co, 110 F Supp 2d 1325,

1330 (D Or 2000) (citing Morgan v Hilti, 108 F3d 1319, 1325 (10th

Cir 1997)) (FMLA). Defendants advance several arguments for

dismissing Smith’s federal claims.

A

Defendants first contend that actions taken against a

former employee by his former employer after the employment

relationship has been severed cannot give rise to claims for

retaliation under federal law. 

The ADEA provides in pertinent part: 

It shall be unlawful for an employer to discriminate

against any of his employees * * * because such

individual * * * has opposed any practice made

unlawful by this section, or because such individual

* * * has made a charge, testified, assisted, or

participated in any manner in an investigation,

proceeding, or litigation under this Act.

29 USC § 623. 

“Employee,” as used in the virtually identical language of Title

VII of the Civil Rights Act of 1964, includes former employees. 

Robinson v Shell Oil Co, 519 US 337, 346 (1997). “To read the

[ADEA] otherwise would be to deny protection to any person who has

suffered discharge or termination due to unlawful discrimination. 

Obviously, Congress could not have intended such an absurd result.” 

Passer v American Chemical Society, 935 F3d 322, 331 (DC Cir 1991). 

The ADA and FMLA anti-retaliation provisions protect not

only “employees,” but “any individual.” 29 USC § 2615(a)(2); 42

USC § 12203. Because the statutes do not define “individual,”

following the Supreme Court’s lead, the court takes it as “a

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broader term than ‘employee’ [that] would facially seem to cover a

former employee.” Robinson, 519 US at 345. 

The court concludes that Smith has statutory standing to

assert his federal claims.

B

Next, defendants argue that Smith has not alleged adverse

employment action. In the Ninth Circuit, “adverse employment

action” means “any adverse treatment that is based on a retaliatory

motive and is reasonably likely to deter the charging party or

others from engaging in protected activity.” Ray v Henderson, 217

F3d 1234, 1242-43 (9th Cir 2000). This deterrence standard “does

not limit what type of discrimination is covered, nor does it

prescribe a minimum level of severity for actionable

discrimination.” Id at 1243.

 Defendants contend that no reasonable person in Smith’s

position would be deterred by the allegedly retaliatory conduct. 

According to defendants, because Smith was no longer in their

employ, he could not possibly have been deterred by the threat of

any future employment action from them. In other words, Smith “had

nothing to fear, and nothing to lose.” Doc #33 at 8. 

The court disagrees. Retaliation against one person’s

exercise of protected rights “can have a deleterious effect on the

exercise of these rights by others.” Hashimoto v Dalton, 118 F3d

671, 676 (9th Cir 1997). Thus, the question is not whether Smith

was actually deterred by defendants’ alleged conduct. Rather, the

inquiry is whether a reasonable person in Smith’s position would be

deterred. If defendants’ interpretation were correct, a

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retaliation claim could never arise from conduct that occurs after

protected activity. This is untenable. 

Defendants further contend that their conduct does not

constitute adverse employment action because the Ninth Circuit has

noted that “badmouthing an employee outside the job reference

context do[es] not constitute adverse employment actions.” Brooks

v City of San Mateo, 229 F3d 917, 929 & n 12 (9th Cir 2000) (citing

Nunez v City of Los Angeles, 147 F3d 867, 875 (9th Cir 1998)). 

Brooks, however, did not involve anything that could be

characterized as “badmouthing,” which relegates the language upon

which defendants rely to the status of obiter dictum. Moreover,

Nunez is factually distinguishable from the present case. There,

the plaintiff merely alleged that “his superiors retaliated by

scolding him and threatening to transfer or to dismiss him.” 

Nunez, 147 F3d at 874. In contrast, this case involves

significantly different circumstances under which defendants

allegedly badmouthed Smith in front of other employees as well as

potential employers, albeit not in the typical job reference

context.

Out-of-circuit authority is instructive. In Passer,

supra, a chemist sued his former employer for age discrimination in

violation of the ADEA. Passer, 935 F3d at 324. In response,

plaintiff’s employer canceled a special symposium to have been held

in plaintiff’s honor a few days before it was to have begun. Id at

325. The court accepted as true plaintiff’s allegation that the

cancellation “humiliated him before the assemblage of his

professional associates and peers from across the nation, and made

it more difficult for him to procure future employment” and held

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that plaintiff had stated a retaliation claim under the ADEA. Id

at 331-32. See also Ray, 217 F3d at 1241 (expressing agreement

with Passer’s application of the deterrence standard). 

Turning to the present case, Smith’s allegations satisfy

the deterrence test. Smith alleges that although he was publicly

accosted by Local 250’s agent at the union meeting in Oakland,

subjected to verbal obscenities and ordered to leave the premises

by security guards and police officers summoned to the scene. SAC

¶9. Smith also alleges that this incident “occurred in view of

representatives of the numerous SEIU local unions that would make

up the natural pool of potential employers for Plaintiff.” Id. 

Smith further alleges that Roselli defamed him to the president of

a potential employer. Id ¶10. Finally, Smith claims that as a

result of these allegedly retaliatory acts, he has lost “future

employment opportunities.” Id ¶¶15, 20. As in Passer, the

gravamen of these allegations is that humiliation in the presence

of prospective employers constituted adverse employment action.

Under the deterrence standard applied by the Ninth

Circuit, defendants’ alleged conduct would be reasonably likely to

deter persons in Smith’s position from engaging in protected

activity. Hence, Smith has stated claims for retaliation under the

ADA, ADEA and FMLA. Defendants’ motion to dismiss Smith’s federal

claims is accordingly DENIED.

//

//

//

//

//

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V

State Law Claims

A

Defendants move to dismiss Smith’s FEHA claim on the

ground that Smith has not alleged adverse employment action. 

In contrast to federal law, “the proper standard for

defining an adverse employment action [under California law] is the

‘materiality’ test, a standard that requires an employer’s adverse

action to materially affect the terms and conditions of employment,

rather than the arguably broader ‘deterrence’ test.” Yanowitz v

L’Oreal USA, Inc, 36 Cal 4th 1028, 1036 (2005) (internal citations

omitted). The “materiality” test looks to whether the alleged

retaliatory conduct “is reasonably likely to impair a reasonable

employee’s job performance or prospects for advancement or

promotion.” Id at 1054-55. Once again, defendants argue that

because Smith was no longer an employee of Local 250, the alleged

retaliatory conduct does not constitute adverse employment action. 

For purposes of Smith’s FEHA claim, the court agrees.

Smith cites no authority for the proposition that

defendants are liable under FEHA for materially affecting the terms

and conditions of his employment with a new employer. Nor has

Smith alleged that defendants refused to rehire him. Under these

circumstances, the court simply cannot construe Smith as alleging

that defendants’ alleged retaliatory conduct affected Smith’s

“prospects for advancement or promotion.” For it does not appear

the California Supreme Court’s interpretation of FEHA protects

Smith’s prospects for future employment with other employers. See,

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e g, Yanowitz, 36 Cal 4th at 1050 (“[T]he Legislature intended to

extend a comparable degree of protection both to employees who are

subject to * * * basic forms of discrimination * * * —— that is,

for example, discrimination on the basis of race or sex —— and to

employees who are discriminated against in retaliation for opposing

such discrimination * * *.”). Smith’s reliance upon Ninth Circuit

precedent, Doc #44 at 21, is misplaced, see Yanowitz, 36 Cal 4th at

1050 & n 10 (noting that the Ninth Circuit applies the broader

deterrence test).

Accordingly, defendants’ motion to dismiss Smith’s FEHA

claim is GRANTED.

B

Defendants move to dismiss Smith’s defamation claim on

the grounds that (1) the claim is barred by the applicable statute

of limitations, (2) the allegedly defamatory statements are

privileged under California Civil Code § 47 and (3) the allegedly

defamatory statements are non-actionable opinion. 

1

Under California law, a claim for defamation must be

commenced within one year of the alleged defamatory act. Cal Civ

Code § 340(c). The defamatory statements alleged in the SAC were

contained in a letter authored by Roselli on September 12, 2003. 

See SAC ¶¶10, 33. Smith filed his original complaint on July 14,

2005, approximately 22 months after the alleged defamatory acts. 

Ostensibly, then, Smith’s claim for defamation is barred by

limitations. 

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Smith invokes the doctrine of “equitable tolling,”

arguing that the filing of his EEOC complaint on November 12, 2003

(i e, within the limitations period), tolled the running of the

statute until the EEOC issued a determination of probable

retaliation on April 21, 2005. SAC ¶38. Hence, Smith asserts that

his claim was timely filed less than three months after that

determination. 

“As with the limitations period itself, [the court

borrows] rules for equitable tolling of the period from the forum

state, California.” Cervantes v City of San Diego, 5 F3d 1273,

1275 (9th Cir 1993). In Cervantes, the Ninth Circuit summarized

the law of equitable tolling in California:

Under California law, equitable tolling relieves

plaintiff from the bar of a limitations statute

when, possessing several legal remedies he,

reasonably and in good faith, pursues one designed

to lessen the extent of his injuries or damage. 

* * * California courts have developed a definitive

three-pronged test for invocation of the doctrine of

equitable tolling. A plaintiff's pursuit of a

remedy in another forum equitably tolls the

limitations period if the plaintiff’s actions

satisfy these factors: 1) timely notice to the

defendants in filing the first claim; 2) lack of

prejudice to the defendants in gathering evidence

for the second claim; and 3) good faith and

reasonable conduct in filing the second claim. 

Id (internal quotations and citations omitted).

Defendants contend that Smith cannot satisfy the second prong. 

Specifically, defendants posit that they would be prejudiced

because Smith’s EEOC complaint did not put them on notice of the

need to investigate and defend against a defamation claim. 

Defendants overlook that “the focus of [the prejudice]

factor is whether the facts of the two claims are ‘at least so

similar that the defendant’s investigation of the first claim will

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put him in a position to fairly defend the second.’” Id at 1276

(quoting Collier v City of Pasadena, 142 Cal App 3d 917, 925

(1983)). And “[u]nder California’s equitable tolling test,

‘similarity’ is less a legal conclusion and more a factual

exploration of the contentions and evidence relevant to each claim. 

As such, ‘similarity’ is not easily resolved as a matter of law,

without receiving evidence.” Id. “The sole issue is whether the

complaint, liberally construed in light of our ‘notice pleading’

system, adequately alleges facts showing the potential

applicability of the equitable tolling doctrine.” Id at 1277

(emphasis in original). 

For example, in Cervantes, the plaintiff invoked

equitable tolling to save his otherwise untimely claims for

wrongful termination. Id at 1274. He claimed that defendants

conspired to violate his civil rights by framing him for illegal

drug use and sale, which resulted in his wrongful termination.

“Because loss of employment [was] the main injury alleged * * *, a

showing that [the plaintiff] was not framed but was in fact guilty

of the offenses resulting in his termination is an obvious defense

both here and in the administrative proceedings.” Id at 1277 n 5. 

Moreover, the plaintiff in Cervantes alleged facts that

entitled him to develop a factual basis for equitable tolling. “He

allege[d] timely initiation of administrative efforts seeking

reinstatement [after his termination] and timely filing of [his

court] action once those proceedings were completed.” Id at 1277. 

“His allegations [also suggested] that defending the prior

proceedings would have necessarily involved the collection of

evidence to rebut his claims [in court].” Id. “Finally, none of

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the allegations indicate[d] that, as a matter of law, [the

plaintiff] acted other than reasonably and in good faith in 

bringing this action.” Id. Accordingly, the court reversed

dismissal, holding that “allegations of [the plaintiff’s] pursuit

of administrative reinstatement entitle[d] him to offer evidence to

support his contention that the limitations period was equitably

tolled.” Id. 

In the present case, Smith has similarly alleged timely

initiation of administrative proceedings with the EEOC one month

after an allegedly retaliatory act. His allegations suggest that

defending his retaliation claim, an element of which is the Roselli

letter, would have necessarily involved the collection of evidence

to rebut his defamation claim based on the same letter. Because

retaliatory conduct is the main injury alleged by Smith, a showing

that Smith was not defamed but did in fact behave as Roselli

represented is an obvious defense both here and in the EEOC

proceedings. Finally, none of the allegations indicates that, as a

matter of law, Smith acted other than reasonably and in good faith

in bringing this action. “[O]rdinarily equitable tolling is not

properly resolved at the pleading stage,” id, and this case is not

exceptional. Smith is entitled to offer evidence to support his

contention that equitable tolling applies. Accordingly, the court

declines to dismiss Smith’s defamation claim as time-barred at this

point in the proceedings.

//

//

//

//

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Section 47 of the California Civil Code bestows

privileged status upon a “publication or broadcast” that is made

“[i]n a communication, without malice, to a person interested

therein.” Although Smith specifically alleges defendants acted

“with malice,” SAC ¶37, defendants contend that Smith’s allegations

do not overcome the privilege, Doc #33 at 11. 

“Malice, intent, knowledge, and other condition of mind

of a person may be averred generally.” FRCP 9. Moreover, Smith

has alleged facts that, if proved, would support an inference of

malice. Specifically, Smith has alleged that Roselli (1) intended

to misrepresent Smith to the SEIU international president, (2) knew

his statements about Smith were false or published them with

reckless disregard of their veracity, (3) knew of Smith’s

psychological and emotional sensitivities and (4) purposefully

engaged in defamatory conduct. SAC ¶¶33-37. Accordingly, the

court finds that Smith’s allegations are sufficient to overcome

defendants’ invocation of the statutory privilege at this point in

the proceedings. See, e g, Steven v Rifkin, 608 F Supp 710, 734

(ND Cal 1984) (Aguilar).

3

To be defamatory, “the publication in question must

contain a false statement of fact.” Gregory v McDonnell Douglas

Corp, 17 Cal 3d 596, 600 (1976) (emphasis in original). “The

dispositive question for the court is whether a reasonable fact

finder could conclude that the published statements imply a

provably false factual assertion.” Moyer v Amador Valley J Union

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High School Dist, 225 Cal App 3d 720, 724 (1990). “The answer to

that question is determined by applying the ‘totality of

circumstances’ test —— a review of the meaning of the language in

context and its susceptibility to being proved true or false.” Id

at 725. “This contextual analysis demands that the courts look at

the nature and full content of the communication and to the

knowledge and understanding of the audience to whom the publication

was directed.” Baker v Los Angeles Herald Examiner, 42 Cal 3d 254,

261 (1986). “If the publication so construed is not reasonably

susceptible of a defamatory meaning and cannot be reasonably

understood in the defamatory sense pleaded,” dismissal is proper. 

Id. 

Smith essentially alleges that the letter contained three

defamatory statements that Smith is (1) “disreputable,” (2)

“unstable and unpredictable and prone to embarrassing outbursts at

meetings” and (3) “incapable of respecting the confidences and

discipline necessary to fight an employer like Sutter.” SAC ¶33. 

The first statement expresses Roselli’s opinion that Smith is

subjectively held in low esteem by others and, as such, is not

actionable. The second and third statements, however, do imply

falsifiable facts. As alleged in the SAC, these statements suggest

that Smith has, in fact, disrupted meetings, betrayed the

confidences of others and otherwise displayed an inability to

represent workers against major employers. Id. Furthermore,

Roselli’s position as Smith’s former supervisor would lead the

recipient of the letter to believe Roselli’s words as statements of

fact regarding a former subordinate’s performance and abilities. 

See Kahn v Bower, 232 Cal App 3d 1599, 1608 (1991) (finding that

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because of defendant’s “professional status and that of the person

to whom she wrote, plaintiff’s supervisor,” allegedly defamatory

letter was susceptible to interpretation that plaintiff’s

incompetence was a matter of fact).

Defendants’ motion to dismiss Smith’s defamation claim is

DENIED.

C

Smith’s sixth claim alleges intentional interference with

prospective business advantage. To establish this claim, Smith

must show “(1) an economic relationship between [Smith] and some

third party, with the probability of future economic benefit to

[Smith]; (2) the [defendants’] knowledge of the relationship; (3)

intentional acts on the part of the [defendants’] designed to

disrupt the relationship; (4) actual disruption of the

relationship” and (5) defendants’ conduct caused economic harm to

Smith. Youst v Longo, 43 Cal 3d 64, 71 n 6 (1987). Additionally,

Smith must show that defendants’ conduct was independently wrongful

—— that is, “wrongful apart from the interference itself.” Korea

Supply Co v Lockheed Martin Corp, 29 Cal 4th 1134, 1154 (2003). 

Finally, “[a]n essential element of the tort of intentional

interference with prospective economic advantage is the existence

of a business relationship with which the tortfeasor interfered. 

Although this need not be a contractual relationship, an existing

relationship is required.” Roth v Rhodes, 25 Cal App 4th 530, 546

(1994) (citations omitted).

Defendants contend that “Smith has not alleged any

existing relationship with any party other than Local 707, for whom

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he completed all services on his contract with that union.” Doc

#33 at 13. In other words, there was no disruption to the only

existing relationship alleged in the SAC. Implicit in defendants’

argument is the proposition —— for which defendants’ have cited no

authority —— that an economic relationship evidenced by a contract

which expires by its own terms cannot have been “disrupted” for

purposes of tortious interference. 

The SAC alleges that following a conversation with

Roselli, Local 707 general manager Bill Steck informed Smith that

Smith “would not be a part of [the statewide Sutter campaign], even

though his work with the Sutter nurses as a consultant to SEIU

Local 707 had already been budgeted for.” SAC ¶12. Later, Steck

informed Smith that “he was definitely off the Sutter hospital

campaign —— the project for which SEIU Local 707 had hired him, and

upon which he had been working for the previous two years.” Id. 

Although Smith “was allowed to do other work in order to finish out

his contract with SEIU Local 707,” he “received no further

employment from that union.” Id.

These allegations sufficiently allege a disruption to the

relationship between Smith and Local 707 as well as a causal

connection between Roselli’s conduct and the disruption. See also

SAC ¶¶10-11. And reasonably construed in favor of Smith, the SAC

sufficiently alleges a probability that the relationship between

Smith and Local 707 would have continued beyond the initial

contractual term. 

Defendants also challenge the sufficiency of the

allegations with respect to intent and economic harm. The SAC

alleges that Roselli “accuse[d] SEIU Local 707 of putting the

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interests of a disreputable consultant ahead of the interests of

SEIU members because SEIU Local 707 refused to join in [Local

250]’s concerted campaign of retaliatory blacklisting against”

Smith. SAC ¶10 (internal quotations omitted). On this basis, the

finder of fact could infer that Roselli intended to interfere with

Smith’s relationship with Local 707. With regard to economic harm,

the court is satisfied that the allegations of the SAC are

sufficient. See SAC ¶13.

Defendants’ motion to dismiss the claim for intentional

interference with prospective economic advantage is DENIED.

D

Smith’s claim for blacklisting arises under sections

1050, 1052 and 1054 of the California Labor Code. Section 1050

provides: “Any 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 1052 provides: “Any person who knowingly causes, suffers,

or permits an agent, superintendent, manager, or employee in his

employ to commit a violation of section[] 1050 * * *, or who fails

to take all reasonable steps within his power to prevent such

violation is guilty of a misdemeanor.” Section 1054 creates civil

liability for violations of sections 1050 and 1052. 

Defendants do not argue that Smith has failed to allege a

violation of either section 1050 or section 1052. Defendants’ sole

argument for dismissing Smith’s blacklisting claim is predicated

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upon section 1053, which provides in relevant part: “Nothing in

this chapter shall prevent an employer or an agent, employee,

superintendent or manager thereof from furnishing, upon special

request therefor, a truthful statement concerning the reason for

the discharge of an employee or why an employee voluntarily left

the service of the employer” (emphasis added). Defendants argue

that the following allegation brings Smith’s blacklisting claim

within the ambit of section 1053:

On September 5, 2003, SEIU Local 707 General Manager

Allen wrote a letter to [SEIU] International

President Andrew Stern * * *. In this letter,

General Manager Allen asked the International office

to direct [Local 250] not to interfere with the

Plaintiff’s work and pointed out again that it was

illegal for [Local 250] to engage in retaliatory

blacklisting. * * * Without being asked for his

response or opinion by anyone, * * * Sal Roselli

sent a letter of his own to International President

Stern, dated September 12, 2003. 

SAC ¶10. 

According to defendants, Roselli would not have sent this letter

had Allen not initiated correspondence with Stern. Doc #33 at 15. 

Therefore, according to defendants, the SAC alleges that Roselli’s

letter was in response to Allen’s letter, and section 1053 applies. 

The court is unpersuaded. Nowhere does Smith allege

facts suggesting that Roselli’s letter was in response “to a

request therefor” by Stern, Allen or anyone else as required by

section 1053. Defendants’ motion to dismiss Smith’s blacklisting

claim is DENIED.

//

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E

Smith’s eighth claim alleges intentional infliction of

emotional distress (IIED). In order to establish a claim for IIED, 

a plaintiff must show (1) “extreme and outrageous conduct by the

defendant with the intention of causing, or reckless disregard of

the probability of causing, emotional distress;” (2) plaintiff

suffered “severe or extreme” emotional distress and (3) causation. 

Christensen v Superior Court, 54 Cal 3d 868, 903 (1992) (internal

quotations omitted). In order to be outrageous, conduct “must be

so extreme as to exceed all bounds of that usually tolerated in a

civilized community.” Id. 

Further, “[i]t is not enough that the conduct be

intentional and outrageous. It must be conduct directed at the

plaintiff, or occur in the presence of a plaintiff of whom the

defendant is aware.” Id at 905. “The only exception to this rule

is that recognized when the defendant is aware, but acts with

reckless disregard, of the plaintiff and the probability that his

or her conduct will cause severe emotional distress to that

plaintiff.” Id. “Where reckless disregard of the plaintiff’s

interests is the theory of recovery, the presence of the plaintiff

at the time the outrageous conduct occurs * * * justifies recovery

* * *.” Id at 906 (emphasis added). 

Smith’s IIED claim arises from two events: Smith’s

ejection from the business meeting and Roselli’s letter to Stern.

1

The Roselli letter cannot give rise to a claim for IIED

in the absence of any allegation that the letter was directed at

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Smith. But nowhere does the SAC allege that Roselli intended to

send the letter to Smith (or anyone else besides Stern) or that

Roselli knew Smith would be present when the letter was read. SAC

¶10. Hence, even if the letter was defamatory, Smith has failed to

allege any conduct directed at him or occurring in his presence

which was known to defendants. 

Smith does allege that defendants recklessly disregarded

his interests because they “knew or should have known, to a

substantial certainty,” that Roselli’s letter “would result in

severe emotional distress” to Smith. SAC ¶49. But Smith has not

alleged that he was actually present at the time the allegedly

outrageous conduct occurred. Therefore, Smith cannot invoke the

“reckless disregard” exception to the general rule that to state a

claim for intentional infliction of emotional distress, defendants’

conduct must be directed at plaintiff, or occur in the presence of

a plaintiff of whom defendant is aware.

2

With regard to Smith’s alleged ejection from the business

meeting, the SAC does not allege that Roselli was present during

the confrontation. The SAC only suggests that Roselli authorized a

Local 250 employee to eject Smith which, as the president of the

organization renting the facility, was ostensibly his prerogative. 

SAC ¶9. This is not extreme or outrageous conduct. And any public

embarrassment and accompanying distress Smith may have suffered

after he was instructed to leave would have been attributable at

least in part to his refusal promptly to do so. 

//

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Smith seeks recovery from Local 250, but has failed to

allege facts that would establish a basis for respondeat superior. 

In order to hold Local 250 vicariously liable, Smith must establish

that a Local 250 employee is liable for intentional infliction of

emotional distress. Smith has alleged that another Local 250

employee, Ralph Cornejo, accosted him with verbal obscenities

before numerous labor representatives at the meeting. Id. But

Cornejo is not a party in this action. Even assuming that

Cornejo’s conduct was extreme and outrageous, Smith has alleged

nothing regarding Cornejo’s intention of causing, or reckless

disregard of the probability of causing, emotional distress to

Smith. Hence, no facts or inferences drawn from the face of the

SAC suggest that Roselli or any other Local 250 employee may be

liable for IIED based on Smith’s ejection from the business meeting

in Oakland. 

Defendants’ motion to dismiss the claim for IIED is

accordingly GRANTED.

F

Finally, defendants move to dismiss all common law causes

of action against Roselli on the ground that individual employees

cannot be sued in connection with personnel actions. In this

regard, defendants rely primarily upon Sheppard v Freeman, 67 Cal

App 4th 339, 347 (1998), in which a split panel of an intermediate

California appellate court held that “an employee or former

employee cannot sue individual employees based on their conduct,

including acts or words, relating to personnel actions.”

// 

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The court doubts whether the California Supreme Court

would adopt the rule of Sheppard. So far as the court can tell,

Sheppard has yet to be cited by another state court, and its

holding has been flatly rejected after extensive analysis by at

least one federal court. See Graw v Los Angeles Metropolitan

Transp Authority, 52 F Supp 2d 1152, 1155-60 (CD Cal 1999). In any

event, the court concludes that Sheppard is inapplicable because

plaintiff’s common-law claims arise from conduct that occurred

after plaintiff and Roselli’s relationship as employees was

terminated. Under these circumstances, Roselli’s conduct cannot be

characterized as personnel action for purposes of the dubious coemployee privilege apparently established by Sheppard.

VI

In sum, defendants’ motion to strike is DENIED. 

Defendants’ motion to dismiss is GRANTED IN PART and DENIED IN

PART.

SO ORDERED.

 

VAUGHN R WALKER

United States District Chief Judge

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