Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_07-cv-03525/USCOURTS-cand-3_07-cv-03525-0/pdf.json

Parties Involved:
Sandra Chew
Plaintiff
Charlotte Dolly
Defendant
Williams Lea Inc.
Defendant

Document Text:

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

SANDRA CHEW,

Plaintiff,

 v.

WILLIAMS LEA INC., et al.,

Defendants. /

No. C 07-03525 CRB

ORDER GRANTING MOTION TO

REMAND

Plaintiff filed this wrongful termination and libel action in state court and defendant

Williams Lea Inc. removed on the ground of diversity jurisdiction. Now pending before the

Court is plaintiff’s motion to remand and for attorney’s fees and costs. After carefully

considering the parties’ papers and evidence, the Court concludes that oral argument is

unnecessary, see Local Rule 7-1(b), and GRANTS the motion to remand, but DENIES the

request for fees and costs.

ALLEGATIONS OF THE COMPLAINT

Plaintiff Sandra Chew worked at Heller Ehrman LLP for 21 years before Heller

outsourced their Document Production Department (“DOCS Center”) to defendant Williams

Lea Inc. Chew subsequently worked for Williams Lea as a Senior Document Specialist,

Desktop Publisher, and Workflow Coordinator. Her manager was defendant Charlotte Dolly. 

Complaint ¶ 7. On March 7, 2007, Chew and her co-worker Jude Delgado contacted the 

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DOCS Center at approximately 5:45 a.m. to inform the Graveyard Workflow Coordinator

that they were running late for their 6:00 a.m. shift. Id. ¶ 8. Chew and Delgado arrived

approximately 20 minutes late, the first time they had ever arrived late for work. Id. ¶ 9. At

approximately 8:00 a.m. that day Chew remembered that she had forgot to “punch in” and

began to record her and Delgado’s time in the “problem log.” The problem log is used for,

among other things, when employees “arrive early or late for work and forget to ‘punch’, or

when employees forget to ‘punch’ out or in from their lunch break.” Id. ¶ 10, 11. Because

Chew and Delgado have identical work schedules, Chew started but did not complete the

entry in the problem log for both of them. She indicated that she arrived at 6:00 a.m. because

this was their scheduled time to arrive. Id. ¶ 12. Chew had made no attempt to conceal her

late arrival as she and Delgado had telephoned the DOCS Center to advise of their late

arrival. Id. ¶ 13. 

On March 19, 2007, approximately two weeks after Chew arrived late to work, Chew

suffered an injury at home. Id. ¶ 16. As a result of that injury Chew missed one week of

work. Id. ¶ 17-20. 

On April 4, 2007, defendant terminated Chew for “Time Card Falsification.” 

Between March 28 and the termination of her employment, neither the DOCS Center

Manager nor the DOCS Center Supervisor contacted Chew or Delgado about the time entry

discrepancy, although such clarification had been sought in the past with all other employees. 

Id. ¶ 15. 

Chew subsequently filed various disability and related state court claims against

Williams Lea in state court. She also makes a single claim of libel against her manager

Charlotte Dolly. She alleges that Dolly’s false and defamatory statements, arising from

Dolly’s allegation of time card falsification, included “accusations that Plaintiff violated

company policies; that she was such a poor performer; that she deserved written warnings

and disciplinary actions against her; that she was incompetent; a troublemaker; and was

dishonest.” Id. ¶ 39. She further alleges that the false statements were “negligently,

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recklessly, and intentionally published in a manner equaling malice.” Id. ¶ 46. Further, the

false statements were made with “hatred and ill will” towards plaintiff. Id.

Defendant Williams Lea removed the case to federal court on the ground of diversity

jurisdiction. While Chew and Dolly are not diverse, defendant asserts that the claim against

Dolly should be disregarded for the purpose of determining this Court’s jurisdiction.

DISCUSSION

“A defendant has the burden of proving that the requisite jurisdiction exists to support

removal.” Soo v. United Parcel Service, 73 F.Supp.2d 1126, 1128 (N.D. Cal. 1999) (citation

omitted). “When a case is removed to federal court there is a strong presumption against

federal jurisdiction.” Id.

The joinder of a nondiverse defendant is fraudulent or a “sham” and does not defeat

jurisdiction if the plaintiff fails to state a cause of action against the defendant, and the failure

is obvious according to the settled rules of the state. See McCabe v. General Foods Corp.,

811 F.2d 1336, 1339 (9th Cir. 1987) (“fraudulent joinder is a term of art”). A party is

deemed to have been joined “fraudulently” if, “after all disputed questions of fact and all

ambiguities in the controlling state law are resolved in the plaintiff’s favor, the plaintiff could

not possibly recover against the party whose joinder is questioned.” Kalawe v. KFC

Management Co., 1991 WL 338566, *2 (D. Hawaii, July 16, 1991) (citing Kruso v.

International Telephone & Telegraph Corp., ITT, 872 F.2d 1416, 1426 (9th Cir. 1989)).

The dispositive issue is whether plaintiff can state a claim because of the qualified

privilege found at California Civil Code section 47(c). That statute provides that “[a]

privileged publication . . . is one made . . . (c) In a communication, without malice, to a

person interested therein, (1) by one who is also interested . . . .” “This qualified privilege

may exist where the communicator and recipient have a common interest and the

communication is reasonably calculated to further that interest. Communication among a

company’s employees that is designed to insure honest and accurate records involves such a

common interest.” Kelly v. General Telephone Co.,136 Cal.App.3d 278, 285 (1982). 

Defendant has shown, and plaintiff does not seriously dispute, that the allegedly libelous

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statements were made by one in interest to others in interest, that is, to relevant company

employees.

The privilege, however, is qualified, and does not apply if the allegedly defamatory

statement was made with malice, that is, it was motivated by hatred or ill will toward the

plaintiff, or was made without a good-faith belief in the truth of the statement. Lundquist v.

Reusser, 7 Cal.4th 1193, 1213 (1994). As is set forth above, the complaint alleges that Dolly

made the statements because of malice toward plaintiff and hatred and ill will. Courts have

held, however, that conclusory allegations of malice are insufficient to defeat the privilege. 

See Martin v. Kearney, 51 Cal.App.3d 309, 312 (1975) (“Actual facts of malice must be

alleged or be apparent from the communications themselves.”); Lesperance v. North

American Aviation, Inc., 217 Cal.App.2d 336, 341 (1963) (holding that the plaintiff must

allege actual facts supporting the claim of malice and not such general conclusions); 

Kacludis v. GTE Sprint Comm Corp., 806 F.Supp. 866, 872 (N.D. Cal. 1992) (“Mere

allegations that the statements were made ‘with malice’ or with ‘no reason to believe the

statements were true’ are insufficient to rebut the presumption of privilege.”).

Assuming, without deciding, that plaintiff has not sufficiently alleged facts showing

actual malice or that Dolly lacked a good-faith belief in the truth of the statement, defendant

has not shown that plaintiff could not as a matter of law allege such facts. To the contrary,

the complaint’s allegations suggest that plaintiff could explicitly allege that Dolly lacked a

good faith belief in her statements given her failure to make any inquiry of plaintiff into

what--from the allegations of the complaint--appears to be a minor discrepancy. Moreover,

the implied allegation of retaliation because of plaintiff’s disability leave further suggests

malice. 

In sum, this is not a case where a plaintiff cannot under any circumstances make a

claim against the non-diverse defendant. Accordingly, Dolly was not “fraudulently joined”

and the motion to remand must be granted. The Court concludes, however, that an award of

attorney’s fees and costs is not warranted.

//

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CONCLUSION

Regardless of whether plaintiff has stated a defamation claim against Dolly, it is

apparent that under California law she can state such a claim. Accordingly, the motion to

remand is GRANTED. The Court in its discretion denies the request for attorney’s fees and

costs.

IT IS SO ORDERED.

Dated: August 22, 2007 

CHARLES R. BREYER

UNITED STATES DISTRICT JUDGE

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