Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-4_13-cv-02824/USCOURTS-cand-4_13-cv-02824-3/pdf.json

Nature of Suit Code: 442
Nature of Suit: Civil Rights Employment
Cause of Action: 28:1332 Diversity-Employment Discrimination

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United States District Court 

Northern District of California 

UNITED STATES DISTRICT COURT 

NORTHERN DISTRICT OF CALIFORNIA 

STEVEN GROSSMAN, 

Plaintiff, 

v. 

UNITED PARCEL SERVICE, INC., 

Defendant. 

Case No. 13-cv-2824 PJH 

ORDER GRANTING MOTION FOR 

SUMMARY JUDGMENT 

Defendant’s motion for summary judgment came on for hearing before this court 

on March 18, 2015. Plaintiff Steven Grossman (“plaintiff”) appeared through his counsel, 

Stephen Jaffe. Defendant United Parcel Service, Inc. (“defendant” or “UPS”) appeared 

through its counsel, Lara Hutner. Having read the papers filed in conjunction with the 

motion and carefully considered the arguments and the relevant legal authority, and good 

cause appearing, the court hereby GRANTS defendant’s motion as follows. 

BACKGROUND 

 This is an employment case based on an alleged wrongful termination. Plaintiff 

Steven Grossman was employed by defendant UPS from 1978 until 2013. Plaintiff first 

worked as an administrative assistant, which involved loading and sorting packages, from 

1978 until 1984. Plaintiff then worked as a supervisor and office manager, supervising 

200 clerical employees, from 1984 until 1991. Plaintiff then worked in the Technology 

Support Group, working on software and hardware, between 1991 and 2001. Plaintiff 

then worked as an industrial engineer, working with engineering supervisors to implement 

new technology designed to improve package efficiency, from 2001 until 2013. In 2009, 

while in the industrial engineering position, plaintiff was promoted to a position managing 

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the entire West Coast region. See generally Complaint, ¶¶ 14-16. 

In mid-February 2013, plaintiff was informed that he would be transferred to the 

position of Hayward Business Manager, an operational position that involves “the 

interpretation of and compliance with the Teamsters agreement of union drivers, 

managing on-road supervisors, part-time center supervisors, and ensuring compliance 

with the service and safety procedures for union drivers.” Complaint, ¶¶ 17-19. 

Plaintiff was concerned that he lacked experience in operational activities and 

would be unable to perform well in the position. Complaint, ¶ 21. Plaintiff was also 

concerned that the transfer was designed to force him to retire from UPS earlier than he 

had planned. Id. Plaintiff voiced these concerns to a human resources manager and two 

other managers upon learning of the transfer. See Complaint, ¶ 21; Dkt. 40 at 5-6. 

At the time of the transfer, plaintiff was close to turning 55 years old. Plaintiff 

alleges that UPS has a pattern and practice of forcing employees to retire when they 

reach age 55, to prevent them from earning higher pensions that vest at age 65. 

Complaint, ¶¶ 13, 20. 

Four days after the transfer, plaintiff requested retirement paperwork. After four 

weeks at the new position, plaintiff utilized eight weeks of vacation time, and then retired. 

Plaintiff’s last day of work was March 6, 2013. Complaint, ¶ 21. By retiring at age 55, 

plaintiff received pension benefits equaling 58% of his salary. Id., ¶ 22. If he had retired 

at age 65, he would have received a higher percentage of his salary (though the 

complaint does not specify how much higher). Id. 

On May 16, 2013, plaintiff filed suit against UPS, asserting three causes of action: 

(1) wrongful termination due to age in violation of California’s Fair Employment and 

Housing Act (“FEHAˮ), (2) wrongful termination in violation of public policy (also based on 

age discrimination), and (3) breach of implied contract. The case was removed from 

state court on June 19, 2013. UPS now moves for summary judgment on all three 

causes of action. 

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DISCUSSION 

A. Legal Standard 

A party may move for summary judgment on a “claim or defense” or “part of . . . a 

claim or defense.” Fed. R. Civ. P. 56(a). Summary judgment is appropriate when there 

is no genuine dispute as to any material fact and the moving party is entitled to judgment 

as a matter of law. Id. 

A party seeking summary judgment bears the initial burden of informing the court 

of the basis for its motion, and of identifying those portions of the pleadings and discovery 

responses that demonstrate the absence of a genuine issue of material fact. Celotex 

Corp. v. Catrett, 477 U.S. 317, 323 (1986). Material facts are those that might affect the 

outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A 

dispute as to a material fact is “genuine” if there is sufficient evidence for a reasonable 

jury to return a verdict for the nonmoving party. Id. 

Where the moving party will have the burden of proof at trial, it must affirmatively 

demonstrate that no reasonable trier of fact could find other than for the moving party. 

Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). On an issue 

where the nonmoving party will bear the burden of proof at trial, the moving party may 

carry its initial burden of production by submitting admissible “evidence negating an 

essential element of the nonmoving party’s case,” or by showing, “after suitable 

discovery,” that the “nonmoving party does not have enough evidence of an essential 

element of its claim or defense to carry its ultimate burden of persuasion at trial.” Nissan 

Fire & Marine Ins. Co., Ltd. v. Fritz Cos., Inc., 210 F.3d 1099, 1105-06 (9th Cir. 2000); 

see also Celotex, 477 U.S. at 324-25 (moving party can prevail merely by pointing out to 

the district court that there is an absence of evidence to support the nonmoving party’s 

case). 

When the moving party has carried its burden, the nonmoving party must respond 

with specific facts, supported by admissible evidence, showing a genuine issue for trial. 

Fed. R. Civ. P. 56(c), (e). But allegedly disputed facts must be material – the existence 

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of only “some alleged factual dispute between the parties will not defeat an otherwise 

properly supported motion for summary judgment.” Anderson, 477 U.S. at 247-48. 

When deciding a summary judgment motion, a court must view the evidence in the 

light most favorable to the nonmoving party and draw all justifiable inferences in its favor. 

Id. at 255; Hunt v. City of Los Angeles, 638 F.3d 703, 709 (9th Cir. 2011). 

B. Legal Analysis 

Plaintiff’s first two causes of action are pled as wrongful termination claims; the 

first under FEHA, and the second as in violation of public policy. Thus, for those two 

claims, it is not sufficient for plaintiff to show that he was subject to an adverse action, he 

must show that his employment was terminated. 

For each claim, plaintiff relies on the theory of constructive discharge, which 

applies when “the employer’s conduct effectively forces an employee to resign.” Turner 

v. Anheuser-Busch, 7 Cal.4th 1238, 1244 (1994). In order to show constructive 

discharge, a plaintiff must prove that the employer “either intentionally created or 

knowingly permitted working conditions that were so intolerable or aggravated at the time 

of the employee’s resignation that a reasonable employer would realize that a reasonable 

person in the employee’s position would be compelled to resign.” Id. at 1251. The 

“intolerable conditions” must be “sufficiently extraordinary and egregious to overcome the 

normal motivation of a competent, diligent, and reasonable employee to remain on the 

job to earn a livelihood and to serve his or her employer.” Id. at 1246. Importantly, the 

test is an objective one, and the court's focus must be on “the working conditions 

themselves, not on the plaintiff’s subjective reaction to those conditions.” Gibson v. Aro, 

31 Cal.App.4th 1628, 1636 (1995) (emphasis in original). 

The court finds that plaintiff’s evidence does not meet this high standard. In his 

opposition brief, plaintiff improperly relies on subjective criteria to explain why he was 

dissatisfied with his transfer – explaining that it was “his dream” to work in technology and 

engineering, that he had an “emotional investment in his position, as it was one he 

worked his entire career to achieve and maintain,” and that “it was a position in which [he] 

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intended to remain until his retirement after the end of 2014.” Dkt. 40 at 3, 11. 

In a declaration filed along with his opposition brief, plaintiff offers the following: 

I never had a clear description of what my job would be as Hayward 

Business Center Manager, but I understood it would involve directing 

supervisors and operations management specialists, and managing union 

drivers and on-road supervisors in a package-center environment. I also 

understood I was responsible for driver safety and understanding the 

accident reporting process. I also understood I was responsible for 

interpreting and enforcing the labor contract, including the Driver 

Entitlement Process, and time and labor processes. . . . Although I had 

previously interacted with the Hayward Center solely for purposes of 

implementing new technology, I had neither adequate experience nor 

training in any of the tasks for which I understood I would be responsible to 

permit me to succeed. 

Dkt. 40-6 at ¶¶ 6-7. 

 However, although plaintiff was concerned that “UPS had set him up to fail,” there 

is no evidence that he actually did fail to meet expectations, or even that he was criticized 

for his performance. Anyone starting a new position would be expected to face a 

learning curve, and the typical adjustment period that comes with any new job cannot 

constitute “intolerable conditions” that are “sufficiently extraordinary and egregious to 

overcome the normal motivation of a competent, diligent, and reasonable employee to 

remain on the job to earn a livelihood and to serve his or her employer.” The fact that 

plaintiff requested retirement paperwork just four days after the transfer suggests that 

plaintiff made no meaningful effort to adjust to the new role, and instead made a 

voluntary choice to retire based on his “emotional investment” in his former position and 

his subjective preference to stay there until he retired.1 Dkt. 39-1, Ex. F at 3 (plaintiff’s 

responses to requests for admission). As one court, following Turner, has stated, “an 

employee is not permitted to quit and sue simply because he or she does not like a new 

 

1

 Plaintiff emphasizes that he did not actually submit the retirement paperwork until four 

weeks later – but it is relevant that he requested the paperwork so soon after the transfer, 

especially when viewed in combination with the fact that he opposed the transfer from the 

beginning, and ultimately retired based on the same reason that he articulated to the 

human resources department before the transfer. 

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job assignment.” Gibson, 31 Cal.App.4th at 1637. 

 Indeed, plaintiff’s own deposition testimony further shows that the conditions of his 

new positon were not “intolerable.” Plaintiff admitted that his salary and pay grade were 

not decreased, that he was not forced to relocate for the new position (and in fact, that 

his new building was across the street from his former building), and that none of his coworkers were abusive. See Dkt. 39-1, Ex. A at 286:7-287-7; Ex. F at 7. Plaintiff further 

made clear that the only issue that he raised to human resources was his “ability to do 

the job.” Dkt. 39-1, Ex. A at 287:8-17. 

 Simply put, plaintiff has failed to raise a triable issue of fact as to whether his new 

working conditions were “sufficiently extraordinary and egregious to overcome the normal 

motivation of a competent, diligent, and reasonable employee to remain on the job to 

earn a livelihood and to serve his or her employer.” Plaintiff’s only evidence relates to his 

subjective reaction to the new position, and fails to address the issue of whether the 

working conditions themselves were so intolerable that a reasonable person would be 

“compelled to resign.” Accordingly, plaintiff has failed to raise a triable issue as to 

whether there was a constructive discharge, and thus, defendant’s motion is GRANTED 

as to the first and second causes of action. 

 Plaintiff’s third cause of action is for breach of implied contract. California Labor 

Code section 2922 provides that “[a]n employment, having no specified term, may be 

terminated at the will of either party on notice to the other.” However, while the at-will 

presumption of section 2922 prevails where the employer and employee have reached 

no other understanding, it does not overcome employers’ and employees’ “fundamental 

... freedom of contract” to depart from at-will employment. Guz v. Bechtel, 24 Cal.4th 

317, 336 (2000). Thus, the employer and employee may enter “an agreement ... that ... 

the employment relationship will continue indefinitely, pending the occurrence of some 

event such as the employer’s dissatisfaction with the employee’s services or the 

existence of some ‘cause’ for termination.” Id. The contractual understanding need not 

be express, but may be implied in fact, arising from the parties’ conduct evidencing their 

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actual mutual intent to create such enforceable limitations. Id. However, “where there is 

no express agreement, the issue is whether other evidence of the parties’ conduct has a 

‘tendency in reason’ to demonstrate the existence of an actual mutual understanding on 

particular terms and conditions of employment.” Id. at 337. The court must consider 

such evidence and determine whether the “totality of the circumstances” gives rise to an 

implied-in-fact contract limiting the employer’s termination rights. Id. 

 In the complaint, plaintiff alleges that the implied contract was evidenced by “oral 

statements made by senior management to plaintiff over many years and by the contents 

of the UPS Employee Manual, the UPS Code of Conduct, and other UPS documents 

provided and available to plaintiff during his employment.” Complaint, ¶ 35. However, in 

his opposition brief, plaintiff does not cite to any specific statements or documents that 

underlie this allegation, and instead makes the generalized assertion that “[o]ver the 

thirty-five years of [his] employment, UPS gave no indication his position was at risk.” 

Dkt. 40 at 17. 

 The court finds that plaintiff has failed to raise a triable issue as to the existence of 

an implied contract limiting UPS’ termination rights. Plaintiff fails to provide evidence of 

any written policy regarding the term of his employment. And plaintiff’s argument that he 

was given “no indication his position was at risk” over the course of 35 years is 

insufficient to support an implied contract claim, as the California Supreme Court has 

expressly held that “an employee’s mere passage of time in the employer’s service, even 

where marked with tangible indicia that the employer approves the employee’s work, 

cannot alone form an implied-in-fact contract that the employee is no longer at will.” Guz, 

24 Cal.4th at 341-42. 

 Moreover, the court notes that plaintiff affirmatively consented to a job transfer, 

through his completion of a “career development discussion” form indicating that he 

would be willing to accept a change in job functions or a lateral transfer. See Dkt. 39-1, 

Ex. C at 7. 

 For those reasons, the court GRANTS defendant’s motion for summary judgment 

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as to plaintiff’s third cause of action. 

 While the above reasons provide a sufficient basis to grant summary judgment on 

all three of plaintiff’s claims, the court will address an alternative and independent basis 

for dismissal raised by UPS – that all three of plaintiff’s claims are preempted by the 

Employee Retirement Income Security Act (“ERISA”). 

Section 510 of ERISA makes it unlawful for “any person to discharge, fine, 

suspend, expel, discipline, or discriminate against a participant or beneficiary for 

exercising any right to which he is entitled under the provisions of an employee benefit 

plan . . . or for the purpose of interfering with the attainment of any right to which such 

participant may become entitled under the plan.” (emphasis added). Section 514 of 

ERISA provides for preemption of state law claims that seek a remedy for violations of 

rights guaranteed by ERISA. 

 The Ninth Circuit addressed the scope of ERISA preemption in Tingley v. PixleyRichards West, Inc., 953 F.2d 1124 (9th Cir. 1992), which includes a detailed analysis of 

previous Supreme Court and Ninth Circuit precedent. The Tingley court held that 

ERISA’s preemption clause “is to be read expansively,” and that “a garden variety state 

law cause of action, not particularly troublesome in circumstances not involving employee 

benefits, may be preempted where it is used to remedy exactly the type of illegal activity 

proscribed by ERISA.” Id. at 1130-31. 

 In Tingley, the plaintiff had a job that provided health coverage, and three years 

into his employment, his wife gave birth to a child with spina bifida. Plaintiff’s insurance 

company received a $18,000 bill to cover delivery/post-natal costs, and the bill was then 

forwarded to plaintiff’s employer. Within two days, plaintiff was fired without explanation. 

Plaintiff filed suit against his former employer in state court, asserting four causes of 

action, and the defendant removed the case to federal court, on the basis of ERISA 

preemption. The defendant also promptly filed a motion to dismiss based on preemption. 

The district court granted the motion with leave to amend, to allow plaintiff to assert an 

ERISA cause of action. Plaintiff did indeed file an amended complaint, asserting ten 

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causes of action, but chose not to assert an ERISA claim. Defendant again moved to 

dismiss based on preemption, and the court granted the motion only in part. The court 

found that five of plaintiff’s claims (including ones for breach of contract and 

discrimination) were not preempted by ERISA. 

 Defendant appealed, and the Ninth Circuit found that all claims were preempted. 

While certain claims “appear to concern [plaintiff’s] employment relationship rather than 

his employee benefit plan, they spring from the handling and disposition of [his] medical 

benefits insurance claim and thus are subject to preemption.” Id. at 1131. The court 

found that preemption “turns on the employee’s theory of why the termination occurred,” 

which may be discerned from the pleadings or may come out during discovery. Id. 

In this case, UPS argues that the following exchange, at plaintiff’s deposition, 

establishes that all of his claims arise out of UPS’ intent to deny him retirement benefits: 

Q: There are three different claims that you’ve brought. I just want to be clear that 

all of the claims that you brought are based on the fact pattern that unfolded in February 

and March of 2013, that you believe was UPS moving you into a position to force you to 

retire such that they would avoid having to pay you a higher pension. Is that accurate? 

A: Yes. 

Dkt. 39-1, Ex. A (plaintiff’s deposition) at 158:1-9. 

 Based on that question and answer, UPS contends that all of plaintiff’s claims 

concern his benefit plan, not his employment, and thus, are preempted by ERISA. 

 While UPS’ position has merit, the court finds that portions of plaintiff’s claims 

remain outside the scope of preemption. Importantly, while plaintiff’s deposition response 

indicates that his claims are based solely on UPS’ intent to deny him retirement benefits, 

his complaint also alleges discrimination on the basis of age. See Complaint, ¶¶ 26, 31. 

The Tingley court specifically identified an age discrimination claim as something that 

would not be preempted under ERISA. See Tingley at 1131 (“Had [plaintiff], in addition to 

the theory that he was fired because his employer did not want to pay his benefits, 

alleged that he was discriminated against on account of age . . . [his] age discrimination 

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theory would not relate to ERISA and would therefore not be preempted”). 

 Similarly, in another case cited by UPS and described as involving a “nearly 

identical situation,” a court in this district addressed an age discrimination claim that 

appeared to arise out of a denial of benefits. See Terramorse v. Yellow Freight, 1992 

U.S. Dist. LEXIS 8546 (May 11, 1992). While the Terramorse court did find that plaintiff’s 

claims were preempted by ERISA, it also found that the complaint “alleges sufficient facts 

to state an age discrimination claim,” and that “such a claim, otherwise preempted by 

ERISA, may survive to the extent that it relies on a theory independent of the benefit 

plan.” Id. at *10. Thus, the court found the claims “not preempted by ERISA to the extent 

that they relate to a claim for age discrimination.” However, because the Terramorse 

court had before it a motion for summary judgment, it evaluated the non-preempted 

portion of the claim under the summary judgment standard, and found that plaintiff had 

failed to present any evidence of discrimination. 

 The court finds that the approach taken in Terramorse is similarly applicable to this 

case. To the extent that plaintiff alleges that UPS terminated him in order to deny him 

benefits, his claims are preempted under ERISA. To the extent that plaintiff claims that 

he was terminated due to age-based discrimination, or that he was terminated in breach 

of an implied contract, his claims fail to raise a triable issue, as described above. 

CONCLUSION 

For the foregoing reasons, defendant’s motion for summary judgment is 

GRANTED. To the extent that plaintiff seeks leave to amend his complaint to assert a 

violation of ERISA, the request is denied, as amending his complaint at the “eleventh 

hour,” nearly two years after the case was filed, after discovery has closed and a 

summary judgment motion has been filed, would be highly prejudicial. See, e.g., Roberts 

v. Arizona Board of Regents, 661 F.2d 796, 798 (9th Cir. 1981). 

 IT IS SO ORDERED. 

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United States District Court 

Northern District of California 

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Dated: May 21, 2015 

11

__

PH

Un

__________

HYLLIS J. H

nited States

__________

HAMILTON

s District Ju

__________

dge 

______ 

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