Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_09-cv-01282/USCOURTS-azd-2_09-cv-01282-0/pdf.json

Nature of Suit Code: 445
Nature of Suit: Americans with Disabilities Act - Employment
Cause of Action: 42:12101 Americans with Disabilities Act

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 The parties’ requests for oral argument are denied because the parties have fully

briefed the issues and oral argument will not aid the Court’s decision. See Fed. R. Civ. P.

78(b); Partridge v. Reich; 141 F.3d 920, 926 (9th Cir. 1998); Lake at Las Vegas Investors

Group, Inc. v. Pac. Malibu Dev. Corp., 933 F.2d 724, 729 (9th Cir. 1991).

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Lorrie A. Garcia, 

Plaintiff, 

vs.

Regis Corporation, a Minnesota

Corporation d/b/a Cost Cutters Family

Hair; et al., 

Defendants. 

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No. CV09-1282-PHX-DGC

ORDER

Plaintiff Lorrie Garcia has filed a motion for partial summary judgment. Dkt. #17.

Defendant Regis Corporation has filed a motion to strike. Dkt. #27. The motions are fully

briefed (Dkt. ##23, 25, 29, 30). For the reasons stated below, the Court will deny both

motions.1

I. Background.

Plaintiff was a manager at Defendant’s hair salon. She alleges that, on May 6, 2003,

she suffered an injury to her shoulder while in the course of her employment. As a result of

the apparent injury, Plaintiff filed a worker’s compensation claim with the Industrial

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Commission of Arizona. The Industrial Commission initially denied the claim, but Plaintiff

appealed and requested a hearing. Following several hearings, an Administrative Law Judge

(ALJ) granted Plaintiff’s claim, finding she had a “permanent partial disability” under

Arizona worker’s compensation law. Defendant appealed, but after several more hearings

the ALJ affirmed the decision in Plaintiff’s favor. The Defendant did not appeal a second

time and the ALJ’s decision became final. 

On June 17, 2008, Defendant petitioned the Industrial Commission to rearrange the

worker’s compensation benefits previously awarded to Plaintiff. Contrary to Defendant’s

request, the ALJ increased the worker’s compensation benefits due Plaintiff. In doing so, the

ALJ reaffirmed Plaintiff’s “permanent partial disability.” 

Plaintiff has since resigned from her employment with Defendant. She commenced

this action on June 15, 2009, claiming that Defendant violated the Americans with

Disabilities Act (ADA) and the Arizona Civil Rights Act by discriminating against her

because of the disability she suffered in the course of employment. Dkt. #1. Plaintiff alleges

that Defendant demoted her after learning of her disability and retaliated against her for filing

the worker’s compensation claim. Id. ¶¶ 25, 29, 33. 

Plaintiff’s pending motion for partial summary judgment attempts to preclude

Defendant from arguing that Plaintiff does not suffer from a disability within the meaning

of the ADA. Specifically, she argues that the ALJ’s finding that Plaintiff has a “permanent

partial disability” under Arizona worker’s compensation law has preclusive effect on the

issue of Plaintiff’s disability under the ADA. Because the issue of “permanent partial

disability” under Arizona worker’s compensation law is not the same issue as a qualified

disability under the ADA, the Court will deny Plaintiff’s motion.

II. Plaintiff’s Motion for Partial Summary Judgment.

When considering the preclusive effect of state judgments, federal courts must afford

the judgment the same preclusive effect it would enjoy in the state that rendered the decision.

Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75, 81 (1984); see Thornton v. City

of St. Helens, 425 F.3d 1158, 1165 (9th Cir. 2005). Because the Industrial Commission is

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 Arizona law affords final Industrial Commission decisions preclusive effect. See

A.R.S. § 23-947(B) (failure to appeal an Industrial Commission determination in a timely

manner “means that the determination by the commission . . . is final and res judicata to all

parties”).

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an Arizona entity, Arizona law applies.2

 Issue preclusion arises under Arizona law when

(1) the issue was actually litigated in a prior proceeding, (2) the opposing party had an

opportunity to litigate the issue, (3) the opposing party actually litigated the issue, (4) the

prior proceeding resulted in a final judgment, and (5) the issue was essential to that judgment.

Circle K Corp. v. Indus. Comm’n of Ariz., 880 P.2d 642, 645 (Ariz. Ct. App. 1993) (citing

Chaney Bldg. Co. v. City of Tucson, 716 P.2d 28, 30 (Ariz. 1986)). The threshold question

in this analysis is whether “the issue or fact to be precluded [is] the same issue or fact

actually litigated.” City of Tucson v. Superior Court, 798 P.2d 374, 380 (Ariz. 1990)

(emphasis added). Plaintiff has not met her burden on this threshold question.

The Industrial Commission found that Plaintiff suffered from an “unscheduled

permanent partial disability” under Arizona’s worker’s compensation scheme. Dkt. # 18 at

10; see A.R.S. § 23-1044. “Unscheduled” disabilities under this scheme are caused by

injuries not specifically enumerated in the statute, but that nonetheless hamper an employee’s

earning capacity. See A.R.S. § 23-1044(B)-(C). Worker’s compensation claims for

unscheduled disabilities are guided by the American Medical Association’s “Guides to the

Evaluation of Permanent Impairment.” W.A. Krueger Co. v. Indus. Comm'n of Ariz., 722

P.2d 234, 236 (Ariz. 1986). If an employee’s injury is not “ratable” under the Guides, the

ALJ hearing the claim may use discretion in determining whether an unscheduled disability

exists. See id. 

“Disability” under this scheme is related to an individual’s “earning capacity,” not to

an individual’s physical or mental health. Alsbrooks v. Indus. Comm’n of Ariz., 578 P.2d

159, 163 (Ariz. 1978) (“We hold that when the statute says ‘disability,’ it means earning

capacity disability . . . .”); see R.G. Roth Const. Co. v. Indus. Comm’n of Ariz., 613 P.2d 307,

309 (Ariz. Ct. App. 1980) (applying Alsbrooks definition of disability to A.R.S. § 23-1044).

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 A person also has a disability under the ADA if he or she “has a record of” or is

“regarded as having” an impairment under 42 U.S.C. § 12102(1)(A). 42 U.S.C.

§ 12102(1)(B)-(C). Plaintiff’s motion for partial summary judgment implicitly referred only

to impairments under 42 U.S.C. § 12102(1)(A) and did not argue that Plaintiff’s disability

had also been established under the “record of” and “regarded as” definitions. Plaintiff’s

reply raises these new arguments explicitly. Arguments raised for the first time in a reply

will not be considered. Delgadillo v. Woodward, 527 F.3d 919, 930 n.4 (9th Cir. 2008).

Defendant’s motion to strike these new arguments from the record will be denied as moot

because the Court has not considered the arguments.

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Thus, in Arizona worker’s compensation claims, the Industrial Commission is concerned

with physical injury or disability only to the extent that it affects an employee’s ability to

earn a wage. See Savich v. Indus. Comm’n of Ariz., 5 P.2d 779, 780 (Ariz. 1931) (“The word

‘disability’ as used in our Compensation Act, does not mean disablement to perform the

particular work petitioner was doing at the time of his injury, but refers to injuries which

result in impairment of earning power generally. . . . It applies to earning power and not to

inability to do a certain class of work.”).

“Disability” under the ADA is defined very differently as “a physical or mental

impairment that substantially limits one or more major life activities of [an] individual.” 42

U.S.C. § 12102(1)(A).3

 ADA claimants must prove three elements: (1) they suffer from a

physical or mental impairment, (2) the impairment limits a major life activity, and (3) the

limitation is substantial. See Gribben v. United Parcel Serv., Inc., 528 F.3d 1166, 1169 (9th

Cir. 2008). This is an individualized review, based upon the facts of the particular claim.

See Rohr v. Salt River Project Agric. Improvement & Power Dist., 555 F.3d 850, 858 (9th

Cir. 2009) (noting existence of substantial limitation is an “individualized inquiry”); see also

Walton v. U.S. Marshals Serv., 492 F.3d 998, 1002 (9th Cir. 2007) (describing process for

determining major life activity as a comparative exercise); Thornton v. McClatchy

Newspapers, Inc., 261 F.3d 789, 794 (9th Cir. 2001) (requiring “individual inquiry” for

finding of disability). This Circuit has accepted the inability to work as a disability under the

ADA, Deppe v. United Airlines, 217 F.3d 1262, 1265 (9th Cir. 2000), but “‘the inability to

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 This regulation is promulgated by the Equal Employment Opportunity Commission

and defines “major life activities” to include “working.” This Circuit has adopted the

regulation as an interpretive guide to the ADA’s definition of “major life activities.” Deppe,

217 F.3d at 1265. 

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perform a single, particular job does not constitute a substantial limitation in the major life

activity of working,’” id. (quoting 29 C.F.R. § 1630.2(j)(3)(i)).4

As these descriptions show, the elements of disability under Arizona worker’s

compensation law do not match the elements of disability under the ADA. The sole focus

of worker’s compensation law is on the loss of earning capacity; disability is an economic

analysis. The focus of the ADA, however, is the physical and mental health of an individual

and the effect that health has on an individual’s daily life. 

Plaintiff’s case before the Arizona Industrial Commission makes this distinction clear.

The ALJ did not consider whether Plaintiff’s impairment limited a major life activity or was

substantially limiting. Instead, the focus of the ALJ’s inquiry was whether Plaintiff had

sustained an injury covered by the worker’s compensation scheme (Dkt. #18 at 6-8) and

whether that injury affected Plaintiff’s ability to perform her job (id. at 8-9). The ALJ never

completed the “individualized inquiry” required to find that an ADA claimant is substantially

limited in performing a major life activity. 

True, the ALJ considered whether Plaintiff suffered from a physical impairment,

ultimately finding that she did, but physical impairment is only one of three elements that

must be satisfied before a person is disabled under the ADA. See Gribben, 528 F.3d at 1169.

The Court cannot say, as a matter of law, that the ALJ’s finding is the same as finding that

a major life activity was substantially limited. 

Moreover, the Industrial Commission found Plaintiff disabled based on her ability to

perform a single, specific job. Dkt. #18 at 9. The ALJ determined that the Plaintiff did not

suffer from a “scheduled” injury under the worker’s compensation statute and that Plaintiff’s

injury was not “ratable” under the AMA Guides. Id. The ALJ was therefore permitted to

exercise his discretion. W.A. Krueger Co., 722 P.2d at 236. Ordinarily, the decision would

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have been guided by the Plaintiff’s earning capacity before and after the injury. In exercising

his discretion, however, the ALJ deviated from the general “disability-as-a-loss-of-earningcapacity” framework and found that Plaintiff suffered from a permanent partial disability

because her injury prevented her from returning to her “date-of-injury employment.”

Dkt. #18 at 9. In fact, the ALJ explicitly qualified his finding, noting that he made “no

determination whether the claimant has a loss in earning capacity as a result of this decision,

since there may be other manager/stylist jobs” that allow Plaintiff to work within the bounds

of her injury. Id. The decision was affirmed by the Industrial Commission. Id. at 16-17.

As this Circuit has noted, the inability to perform a single job is not sufficient to

qualify for a disability under the ADA. Deppe, 217 F.3d at 1265. The ALJ made clear that

his finding was based on the Plaintiff’s ability to return to her “date-of-injury employment,”

and was not based on Plaintiff’s ability to perform “other manager/stylist jobs.” Dkt. #18 at

9. Accordingly, the ALJ necessarily considered a different issue than disability under the

ADA. 

Plaintiff has not shown that the issue decided by the ALJ was the same disability issue

that must be resolved in this case. As a result, the Court cannot conclude that Defendant is

collaterally estopped from litigating ADA disability in this action, and Plaintiff’s motion for

summary judgment will be denied.

IT IS ORDERED:

1. Plaintiff’s motion for partial summary judgment (Dkt. #17) is denied.

2. Defendant’s motion to strike (Dkt. #27) is denied.

DATED this 7th day of April, 2010.

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