Court Opinion

ID: 2830499
Source: CourtListenerOpinion
Date Created: 2015-08-25 20:01:15.202249+00
Date Added: 2024-06-11T11:31:39.429436
License: Public Domain

FILED
                           NOT FOR PUBLICATION
                                                                           AUG 25 2015
                    UNITED STATES COURT OF APPEALS                      MOLLY C. DWYER, CLERK
                                                                         U.S. COURT OF APPEALS

                            FOR THE NINTH CIRCUIT

NELIA VIRTUSIO,                                  No. 13-16153

              Plaintiff - Appellant,             D.C. No. 3:12-cv-00602-NC

 v.
                                                 MEMORANDUM*
FINANCIAL INDUSTRY
REGULATORY AUTHORITY, INC.,

              Defendant - Appellee.

NELIA VIRTUSIO,                                  No. 14-15834

              Plaintiff - Appellant,             D.C. No. 3:12-cv-00602-NC

 v.

FINANCIAL INDUSTRY
REGULATORY AUTHORITY, INC.,

              Defendant - Appellee.

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

        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                      Argued and Submitted August 13, 2015
                            San Francisco, California

Before: KOZINSKI and TALLMAN, Circuit Judges, and ROSENTHAL,** District
Judge.

      1. Financial Industry Regulatory Authority (“FINRA”) did not breach any

implied-in-fact contract that existed between it and Nelia Virtusio because a

reasonable person would understand FINRA promised to pay only worker’s

compensation benefits—not additional short-term disability benefits—for work-

related injuries. Cf. Guz v. Bechtel Nat’l, Inc., 24 Cal. 4th 317, 336-37, 344

(2000). FINRA’s employee handbook indicated outside guidelines would

determine an employee’s eligibility for short-term disability benefits and that

worker’s compensation benefits covered work-related injuries. The handbook also

directed employees to the human resources department, which told Virtusio that

short-term disability benefits were not available for her work-related injuries. No

FINRA employee made a contrary representation, and no document said she could

have both. A reasonable person would understand that the benefits are mutually

exclusive. Because the remainder of Virtusio’s claims depend on FINRA’s alleged

      **
        The Honorable Lee H. Rosenthal, United States District Judge for the
Southern District of Texas, sitting by designation.
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obligation to pay her short-term disability benefits, they also fail as a matter of law,

and the district court properly granted summary judgment for FINRA.

      2. The district court also properly awarded FINRA attorney’s fees because

amended California Labor Code § 218.5 attached “new legal consequences to

events completed before its enactment,” and thus has an impermissible retroactive

effect. Landgraf v. USI Film Prods., 511 U.S. 244, 270, 280 (1994); cf.

Californians for Disability Rights v. Mervyn’s, LLC, 39 Cal. 4th 223, 230-31

(2006).

      However, the district court failed to discuss whether it specifically

considered Virtusio’s inability to pay when calculating the attorney’s fees award

for FINRA. Cf. Ass’n of Mexican-American Educators v. California, 231 F.3d
572, 592 (9th Cir. 2000) (en banc) (finding that a district court abuses its discretion

by “denying a losing . . . plaintiff’s motion to re-tax costs without considering

(1) the plaintiff’s limited financial resources; and (2) ‘the chilling effect of

imposing such high costs on future civil rights litigants’” (quoting Stanley v. Univ.

of S. Cal., 178 F.3d 1069, 1079 (9th Cir. 1999)). The district court awarded

$74,187.74 in attorney’s fees against a woman whose total annual household

income is $78,000—all of which comes from disability benefits programs.

Refusing to consider whether a claimant such as Virtusio is able to pay would

                                            3
discourage suits by employees who are wrongfully refused disability benefits.

Therefore, we remand for reconsideration of Virtusio’s ability to pay when

recalculating the proper amount of attorney’s fees to award FINRA.

      AFFIRMED in part; REVERSED and REMANDED in part with

instructions to reconsider the appropriate amount of attorney’s fees. Each side

shall bear its own costs on this appeal.

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