Court Opinion

ID: 4169291
Source: CourtListenerOpinion
Date Created: 2017-05-17 20:04:00.497935+00
Date Added: 2024-06-11T07:47:01.564622
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                            MAY 17 2017
                    UNITED STATES COURT OF APPEALS                       MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

SALMA AGHMANE,                                   No.   15-15482

              Plaintiff-Appellant,               D.C. No. 4:13-cv-03698-DMR

 v.
                                                 MEMORANDUM*
BANK OF AMERICA, N.A.,

              Defendant-Appellee.

                    Appeal from the United States District Court
                      for the Northern District of California
                    Donna M. Ryu, Magistrate Judge, Presiding

                     Argued and Submitted February 17, 2017
                            San Francisco, California

Before: BERZON and CLIFTON, Circuit Judges, and MUELLER,** District
Judge.

      Plaintiff-Appellant Salma Aghmane appeals the district court’s order

granting partial summary judgment to Defendant-Appellee Bank of America, N.A.

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The Honorable Kimberly J. Mueller, United States District Judge for
the Eastern District of California, sitting by designation.
(“BANA”). Because we conclude a reasonable jury could find BANA acted with

malice as provided by the interested persons privilege established by California

Civil Code section 47(c), we reverse and remand for further proceedings.

      California’s interested persons privilege immunizes a former employer from

tort liability when the employer communicates without malice to an interested third

party regarding a former employee’s job performance. Cal. Civ. Code § 47(c);

Soukup v. Law Offices of Herbert Hafif, 39 Cal. 4th 260, 293 (2006). In analyzing

malice, courts focus on an individual’s state of mind, rather than conduct, and do

not infer malice from the communication itself. Noel v. River Hills Wilsons, Inc.,

113 Cal. App. 4th 1363, 1370–71 (2003). A plaintiff may prove malice in two

ways: first, by providing direct evidence that the defendant’s communication was

“motivated by hatred or ill will” towards the plaintiff, Agarwal v. Johnson, 25 Cal.
3d 932, 945 (1979) (quoting Brewer v. Second Baptist Church, 32 Cal. 2d 791, 797

(1948)); and second, by providing circumstantial evidence that “the defendant

lacked reasonable grounds for belief in the truth of the publication and therefore

acted in reckless disregard of the plaintiff’s rights,” Sanborn v. Chronicle Pub. Co.,

                                          2
18 Cal. 3d 406, 413 (1976) (quoting Roemer v. Retail Credit Co., 44 Cal. App. 3d
926, 936 (1975)).1 Only the second, circumstantial method is at issue here.

      To prove reckless disregard, the plaintiff must show the defendant “made the

false publication with a high degree of awareness of . . . probable falsity, or must

have entertained serious doubts as to the truth of his publication.” Young v. CBS

Broad., Inc., 212 Cal. App. 4th 551, 563 (2012) (alteration in original) (citations

omitted) (quoting Harte-Hanks Commc’ns, Inc. v. Connaughton, 491 U.S. 657,

667 (1989)). Neither “[t]he failure to conduct a thorough and objective

investigation, standing alone,” nor “mere proof of ill will,” is sufficient to prove

actual malice. Reader’s Digest Ass’n v. Superior Court, 37 Cal. 3d 244, 258

(1984) (citations omitted). A defendant’s recklessness or knowledge of falsity may

be adduced “by accumulation and by appropriate inferences,” Fisher v. Larsen,

138 Cal. App. 3d 627, 640 (1982), from “[e]vidence of negligence, of motive and

of intent,” Reader’s Digest, 37 Cal. 3d at 257 (quoting Goldwater v. Ginzburg, 414
F.2d 324, 342 (2d Cir. 1969)). Evidence showing a publisher’s serious doubts as

to the truth of a publication can include “[a] failure to investigate, anger and

      1
         In interpreting the interested persons privilege, California courts frequently
borrow the “actual malice” standard from the First Amendment context. See
McGrory v. Applied Signal Tech., Inc., 212 Cal. App. 4th 1510, 1539 n.18 (2013)
(collecting cases). This memorandum disposition relies on both lines of authority.
                                           3
hostility toward the plaintiff, [and] reliance upon sources known to be unreliable or

known to be biased against the plaintiff[.]” Id. at 258 (citations omitted).

      A reasonable jury could find BANA acted recklessly when it reported

Aghmane to a third party database maintained by Early Warning Services, LLC

(“EWS”), based on statements made by Aghmane’s cousin, D.A.2 EWS provides

fraud prevention services to member financial institutions and maintains a database

of members’ former employees terminated for knowingly causing or attempting to

cause financial loss. In reporting Aghmane to the EWS system, BANA effectively

made the affirmative representation that it had “conclusive evidence of criminal

wrongdoing” by Aghmane. To establish malice here,

             [i]t is not sufficient to show that the statements were
             inaccurate, or even unreasonable. Only willful falsity or
             recklessness will suffice [because it] is only when the
             negligence amounts to a reckless or wanton disregard for
             the truth, so as to reasonably imply a willful disregard for
             or avoidance of accuracy, that malice is shown.

Kashian v. Harriman, 98 Cal. App. 4th 892, 931 (2002) (internal quotation marks

and ellipsis omitted) (quoting Cabanas v. Gloodt Assocs., 942 F. Supp. 1295,

1301–02 (E.D. Cal. 1996)). A genuine dispute of fact exists if BANA made the

      2
       Because she presented this theory in her briefs below and the district court
addressed it, Aghmane preserved her argument that BANA acted recklessly by
making a statement with no reasonable belief in its truth. See Whittaker Corp. v.
Execuair Corp., 953 F.2d 510, 515 (9th Cir. 1992).
                                           4
representation with reckless disregard for Aghmane’s rights because BANA either

did not believe the statement to be true or it unreasonably believed the statement to

be true. See McGrory, 212 Cal. App. 4th at 1540. “In either case, a fact-finder

would have to ascertain what [BANA] subjectively knew and believed about the

topic at the time [it] spoke.” Id.

      The record in this case reveals a “she said-she said” conflict based on the

statements of Aghmane and D.A. BANA’s case notes summarizing its fraud

analyst’s conversation with D.A., conducted through a foreign language

interpreter, indicate D.A. denied giving Aghmane authorization to withdraw funds

from her account. But D.A. declined to seek prosecution against anyone or to

identify Aghmane in writing. Aghmane told BANA, orally and in writing, that

D.A. authorized the transactions. Aghmane also provided BANA with documents

showing D.A. owed her money, consistent with Aghmane’s contention that she

paid for D.A.’s housing and living expenses when D.A. moved to San Francisco.

BANA’s lead investigator on this matter, Karen Muth, never spoke with D.A. And

no one from BANA contacted D.A. again after Aghmane told her side of the story.

Based on these facts, a reasonable jury could find BANA either knew or

reasonably should have known it did not have “conclusive evidence” that

Aghmane had engaged in criminal wrongdoing.

                                          5
      A reasonable jury also could find BANA acted recklessly by not further

investigating Aghmane’s story. While a negligent investigation alone cannot

establish actual malice, Rollenhagen v. City of Orange, 116 Cal. App. 3d 414, 423

(1981), disapproved of on other grounds by Brown v. Kelly Broad. Co., 48 Cal. 3d
711, 738 (1989), evidence of BANA’s complete disregard of Aghmane’s “denials

may, by accumulation and by appropriate inferences, show recklessness,” Fisher,
138 Cal. App. 3d at 640. Were a jury to find BANA’s failure to investigate “was a

product of a deliberate decision not to acquire knowledge of facts that might

confirm the probable falsity of [the] charges,” it could find actual malice in

BANA’s failure to investigate the conflicting accounts after speaking with

Aghmane. Antonovich v. Superior Court, 234 Cal. App. 3d 1041, 1048 (1991)

(quoting Harte-Hanks, 491 U.S. at 692). Given BANA’s communication to EWS

that it had conclusive evidence that Aghmane engaged in criminal wrongdoing, a

reasonable jury could find BANA’s “investigation [to be] grossly inadequate under

the circumstances.” Fisher, 138 Cal. App. 3d at 640 (quoting Vandenburg v.

Newsweek, Inc., 507 F.2d 1024, 1026 (5th Cir. 1975)). This, too, could allow a

jury to infer actual malice. Id.

                                           6
      The district court erred in granting summary judgment to BANA. We

reverse and remand for further proceedings consistent with this memorandum disposition.

      REVERSED and REMANDED.

                                        7