Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_24-cv-02741/USCOURTS-azd-2_24-cv-02741-0/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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WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Michele Martinez,

Plaintiff,

v. 

State of Arizona, et al.,

Defendants.

No. CV-24-02741-PHX-ROS

ORDER 

Plaintiff Michele Martinez (“Plaintiff”) filed this action against the State of Arizona, 

Karen Peters in her official capacity as the Director of the Arizona Department of 

Environmental Quality (“ADEQ”), and four former or current ADEQ employees—Laura 

Malone, Sowjanya Chintalapati, Leslie Pehoua, and Michael Keyack (“Individual 

Defendants”) (collectively “Defendants”) alleging state and federal employment 

discrimination claims and a claim under 42 U.S.C. § 1983 for violation of Plaintiff’s 

constitutional rights. (Doc. 1-5, “Compl.”). Defendants seek dismissal of the § 1983 claim 

(Count V) against all Defendants, except for the First Amendment retaliation claim against 

Defendant Malone. (Doc. 6, “Mot.”). Plaintiff responded (Doc. 7, “Resp.”), and 

Defendants replied (Doc. 10, “Reply”). For the reasons set forth below, the motion will 

be granted as to the Fourteenth Amendment due process claim and denied as to the First 

Amendment retaliation claim.

I. BACKGROUND

In her Complaint, Plaintiff alleges the following facts relevant to the claims subject 

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to the instant motion. Plaintiff began working at ADEQ 2018 as an Administrative Service 

Officer. (Compl. ¶ 10). During her tenure, Plaintiff reported “unethical and illegal 

conduct” related to “violations of the procurement code and matters involving sharing of 

proprietary software of an existing vendor” on the part of certain ADEQ employees (Id. ¶

13, 15, 16). Once ADEQ became aware of the reporting, Plaintiff alleges she was unfairly 

reprimanded in the manner that follows. (Id. ¶ 20).

At some point, Defendants Keyack and Pehoua lowered her score on her 

performance evaluation despite that they never supervised her. (Id. ¶ 14). On April 26, 

2023, Defendant Malone verbally reprimanded Plaintiff for being “snippy and 

argumentative” at a team meeting the previous day. (Id. ¶ 26). On August 17, 2023, 

Defendant Chintalapati advised Plaintiff she was no longer the project manager for the Tier 

II Project for MyDEQ, effective immediately. (Id. ¶ 29). And on September 8, 2023, 

Plaintiff was called into a meeting with Defendants Malone and Pehoua where she received 

a letter of reprimand for inappropriate and unprofessional behavior during various meetings 

between April 2023 and July 2023. (Id. ¶ 30). According to Plaintiff, receiving this 

discipline has rendered her ineligible for “various positions and financial increases with 

the State of Arizona.” (Id. ¶ 31). 

II. MOTION TO DISMISS

A complaint must set forth a “short and plain statement of the claim showing that 

the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). “To survive a motion to dismiss, 

a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to 

relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting 

Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal citations omitted)). If “the 

well-pleaded facts do not permit the court to infer more than the mere possibility of 

misconduct, the complaint” has not adequately shown the pleader is entitled to relief. Id. 

at 679. Although federal courts ruling on a motion to dismiss “must take all of the factual 

allegations in the complaint as true,” they “are not bound to accept as true a legal 

conclusion couched as a factual allegation.” Id. at 678 (quoting Twombly, 550 U.S. at 555) 

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(internal quotations omitted). 

Defendants argue Count V should be dismissed against all Defendants except for 

the First Amendment retaliation claim against Defendant Malone because (1) Plaintiff 

failed to state a Fourteenth Amendment procedural or substantive due process claim and 

(2) Plaintiff failed to state a First Amendment retaliation claim against Defendants 

Chintalapati, Pehoua, and Keyack. As a preliminary matter, Defendants moved, and 

Plaintiff agreed, to dismiss the State of Arizona from Count V and Defendant Peters from 

the lawsuit.1 (Resp. at 1). The Court will thus dismiss the parties and analyze Defendants’ 

remaining arguments.

A. Fourteenth Amendment Due Process

Defendants argue Plaintiff’s Fourteenth Amendment substantive and procedural due 

process claim fails because (1) the actions alleged do not “shock the conscience” and (2) 

Plaintiff has not identified an applicable property because she was an at-will employee. 

Plaintiff responds that (1) an evaluation of whether the actions alleged “shock the 

conscience” is an inappropriate factual determination and (2) Arizona state employment 

rules confer Plaintiff a property interest in continued employment despite her at-will status. 

The Court agrees with Plaintiff that a determination of whether the actions alleged “shock 

the conscience” is factually dense and thus inappropriate at this stage. However, because 

Plaintiff has not alleged a property interest in continued employment, the Court will grant 

Defendants’ Motion as to the Fourteenth Amendment claim.

The Fourteenth Amendment of the U.S. Constitution provides that no State shall 

“deprive any person of life, liberty, or property, without due process of law.” The Due 

Process Clause provides procedural protections and it also “includes a substantive 

component that ‘provides heightened protection against government interference with 

certain fundamental rights and liberty interests.’” Troxel v. Granville, 530 U.S. 57, 65 

(2000) (quoting Washington v. Glucksberg, 521 U.S. 702, 720 (1997)). A procedural due 

process violation has two elements: “(1) a deprivation of a constitutionally protected liberty 

1 Neither a state or an official acting in her individual capacity is a “person” for purposes 

of § 1983. Will v. Mich. Dep’t of State Police, 491 U.S. 58, 71 (1989).

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or property interest, and (2) a denial of adequate procedural protections.” United States v. 

101 Houseco, LLC, 22 F.4th 843, 851 (9th Cir. 2022) (quoting Brewster v. Bd. of Educ. of 

Lynwood Unified Sch. Dist., 149 F.3d 971, 982 (9th Cir. 1998)).

The Due Process analysis involves a two-step process: (1) determining whether 

Plaintiff had a protected property interest in her continued employment and (2) determining

whether, in being deprived of this interest, she received all the process that was due. 

Clements v. Airport Authority of Washoe Cnty., 69 F.3d 321, 331 (9th Cir. 1995). Property 

interests are created by “existing rules or understandings that stem from an independent 

source such as state law—rules or understandings that secure certain benefits and that 

support claims of entitlement to those benefits.” Brewster, 149 F.3d at 982. “[T]he Court’s 

determination that [Plaintiff] was an at-will employee negates the existence of a property 

interest in [her] employment.” Clements, 69 F.3d at 331 (citing Board of Regents v. Roth, 

408 U.S. 564 (1972)).

Under A.R.S. 41-742(A)(1), beginning in 2012, all new hires in the Arizona State 

Personnel System “are at will uncovered employees.” Plaintiff was hired by ADEQ in 

2018. (Compl. ¶ 10). And she admits she is an at-will employee. (Resp. at 8). Plaintiff 

argues her at-will status does not preempt finding a property interest through her 

interpretation of the Arizona Administrative Code. Plaintiff’s interpretation, however, is 

misguided. Ariz. Admin. Code § 2-5A-801(C)(2)(b) states that an uncovered (at-will) 

employee cannot become a covered employee through an involuntary demotion. Instead 

of creating a property interest, the Code reasserts that “an uncovered employee serves at 

the pleasure of the appointing authority and may be dismissed at will.” Ariz. Admin. Code 

§ 2-5A-801. Thus, Plaintiff’s due process claim fails, and will be dismissed with prejudice.

B. First Amendment Retaliation

A First Amendment retaliation claim requires Plaintiff to allege (1) she engaged in 

constitutionally protected activity (2) the result of which subjected her to adverse action by 

an Individual Defendant that would chill a person of ordinary firmness from continuing to 

engage in the protected activity, (3) substantially causing the adverse action. Blair v. Bethel 

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Sch. Dist., 608 F.3d 540, 543 (9th Cir. 2010) (citing Pinard v. Clatskanie School Dist. 6J, 

467 F.3d 755, 770 (9th Cir. 2006)). Speech is constitutionally protected at step one if it 

involves a matter of public concern and “the employee’s interest in expressing [herself] 

must outweigh the State’s interests in promoting workplace efficiency and avoiding 

workplace disruption.” Brewster, 149 F.3d at 978. “[F]or adverse, retaliatory actions to 

offend the First Amendment, they must be of a nature that would stifle someone from 

speaking out.” Blair, 608 F.3d at 544 (explaining that the most common adverse actions 

are punishments that are “regulatory, proscriptive, or compulsory in nature,” such as loss 

of a job, loss of a license, or accusations of criminal activity) (citing Laird v. Tatum, 408 

U.S. 1, 11, (1972)).

Plaintiff alleges that she was unfairly reprimanded for asserting that, in her view, 

the contract for a new software program that ADEQ was implementing violated Arizona 

procurement law and the legacy software provider’s intellectual property rights. (Compl.

¶¶ 15-20). Defendants concede that Plaintiff’s allegations may be sufficient to state a First 

Amendment retaliation claim against Defendant Malone because she alleges Defendant 

Malone verbally reprimanded her and signed the Letter of Reprimand. (Id. ¶¶ 26, 30).

However, Defendants challenge the sufficiency of Plaintiff’s allegations against 

Defendants Chintalapati, Pehoua, and Keyack. The Court finds Plaintiff has sufficiently 

alleged a retaliation claim against all Individual Defendants.

In her Complaint, Plaintiff alleges “[h]er score on her evaluation was lowered by 

Defendants Keyack and Pehoua despite them never supervising her” following Plaintiff’s 

reporting of alleged “unethical and illegal conduct” by ADEQ employees, including the 

Individual Defendants. (Compl. ¶ 13-14, 16). “A negative performance evaluation may 

constitute an adverse employment action.” Hooks v. Lockheed Martin Skunk Works, 14 

Fed. Appx. 769, 772 (9th Cir. 2001). Plaintiff’s allegations against Defendants Keyack 

and Pehoua are specific relevant facts which sufficiently state a retaliation claim. 

Similarly, Plaintiff alleged “Defendant Chintalapati advised [Plaintiff] during an 

emergency meeting that effective immediately she was no longer the project manager for 

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the Tier II Project for MyDEQ.” (Compl. ¶ 29). The Court finds this allegation sufficiently 

states a material adversity such that it may likely deter a reasonable worker from making a 

charge. See Pearson v. Reynolds Sch. Dist. No. 7, 998 F. Supp. 2d 1004, 1024 (D. Or. 

2014).

* * *

Accordingly,

IT IS ORDERED Defendants’ Motion to Dismiss (Doc. 6) is GRANTED IN 

PART as to the Fourteenth Amendment due process claim in Count V and DENIED IN 

PART as to the First Amendment retaliation claim in Count V.

IT IS FURTHER ORDERED Plaintiff’s Fourteenth Amendment due process 

claim in Count V of the Complaint is DISMISSED WITH PREJUDICE.

IT IS FURTHER ORDERED the State of Arizona is DISMISSED from Count V 

of the Complaint.

IT IS FURTHER ORDERED Defendant Karen Peters is DISMISSED from the 

lawsuit.

Dated this 21st day of January, 2025.

Honorable Roslyn O. Silver

Senior United States District Judge

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