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Vierria v. California Highway Patrol

June 23, 2009


The opinion of the court was delivered by: Frank C. Damrell, Jr. United States District Judge


This matter is before the court on defendants', California Highway Patrol ("CHP"), Tim Castle ("Castle"), State Compensation Insurance Fund ("SCIF"), and Christopher J. Devereux ("Devereux"), motions to dismiss plaintiff Jovita Vierria's ("plaintiff" or "Vierria") complaint, pursuant to Federal Rule of Civil Procedure 12(b)(6). Vierria opposes the motions.

Vierria's complaint alleges eleven causes of action:

(1) violation of the Racketeering Influenced and Corrupt Organization Act ("RICO"), 18 U.S.C. §§ 1961, et seq., against all defendants;

(2) violation of the right to equal protection, 42 U.S.C. § 1983 ("Section 1983"), against CHP and Castle;

(3) violation of the right to freedom of speech, Section 1983 and 42 U.S.C. § 1985, against Castle and Devereux;

(4) taking of property, Section 1983, against all defendants;

(5) violation of the right to privacy, Section 1983, against all defendants;

(6) violation of the Public Safety Officers' Bill of Rights ("POBR"), Cal. Gov't Code §§ 3303 et seq., against all defendants;

(7) Retaliation for Whistleblowing, Cal. Lab. Code § 1102.5, against CHP;

(8) discrimination, retaliation, and harassment in violation of the Fair Employment and Housing Act ("FEHA"), Cal. Gov't Code § 12900 et seq., against CHP;

(9) failure to take reasonable steps to prevent discrimination and harassment in the workplace in violation of FEHA, Cal. Gov't Code § 12900, et seq., against CHP;

(10) abuse of process, against all defendants; and

(11) intentional infliction of emotional distress ("IIED"), against all defendants. Collectively, defendants move to dismiss plaintiff's claims on the following bases:

(1) the RICO claim on the grounds plaintiff fails to allege sufficient facts to establish

(a) defendants engaged in any predicate acts of racketeering,

(b) a pattern of racketeering activity, or (c) a cognizable injury to plaintiff's business or property;

(2) the free speech claim on the basis that defendants' alleged conduct would have no tendency to chill Vierria's speech;

(3) the takings claim on the ground it is barred by the state remedies doctrine;

(4) the privacy claim because Vierria does not allege a federally protected right;

(5) the POBR claim because Vierria does not allege facts to establish she is a "public safety officer;"

(6) the abuse of process claim on the basis it is preempted by the Workers' Compensation Act's ("WCA") exclusive remedy provision; and

(7) the IIED claim on the ground defendants' alleged conduct was not extreme or outrageous, and/or the IIED claim is preempted by the exclusive remedy provision of the WCA.

Certain defendants also make specific arguments with respect to particular claims asserted against them. CHP and Castle move to dismiss all of Vierria's claims on the basis of sovereign immunity. Castle alternatively moves to dismiss plaintiff's RICO claim, as directed against him, on the ground Vierria has not pled sufficient facts to establish he was part of a RICO "enterprise." Further, SCIF and Devereux move to dismiss plaintiff's Section 1983 claims against them on the ground they were not acting under color of law. Devereux also moves to dismiss the Section 1983 claims and the state law claims against him on the basis that he is entitled to absolute or qualified immunity. Finally, as to plaintiff's takings claim, SCIF and Devereux move to dismiss that claim on the ground Vierria has not alleged a plausible connection between SCIF/Devereux's actions and Vierria's resignation.

In her opposition, Vierria concedes that CHP and Castle, in his official capacity, are immune from liability, pursuant to the Eleventh Amendment, from the RICO claim and all state law claims. Vierria, however, seeks leave to amend her complaint to allege said claims against Castle as an individual. Further, Vierria concedes her privacy claim does not plead a valid federally protected right and, thus, seeks leave to amend as to this claim as well.

The court addresses below each of the above bases for dismissal. For the reasons set forth below, defendants' motions to dismiss are GRANTED in part and DENIED in part.*fn1


In 1993, Vierria began work for CHP as an Associate Governmental Analyst in the Disability and Retirement Section ("DRS"). (Compl. ¶ 16, filed February 3, 2009.) The DRS is the department within CHP that manages employee injury and illness cases. (Compl. ¶ 18.) SCIF, established under the California Constitution, provides workers' compensation benefits to CHP employees. (Compl. ¶¶ 28, 33.)

During the 1990s, CHP began receiving an increased number of disability claims associated with retiring CHP Assistant and Deputy Chiefs. (Compl. ¶ 19.) A disabilities claim upon retirement substantially increases the retirement benefits of a CHP employee. (Id.) By 2004, the practice had "snow-balled" and more than 80% of retiring CHP Assistant and Deputy Chiefs claimed a disability upon retirement. (Id.)

Employees that worked for CHP, and DRS, became concerned that the increased disabilities claims appeared to be "fraudulent institutionalized theft of State funds." (Compl. ¶ 20.) In or around 2004, the Sacramento Bee dubbed the "large and unjustified payouts" as the "Chief's Disease." (Compl. ¶¶ 21, 35.) Subsequently, a Grand Jury investigation began. (Compl. ¶ 21.) However, instead of investigating the accuracy of the allegations concerning "Chief's Disease," CHP began a "witch hunt" to determine which, if any, of its employees had leaked the information to the Sacramento Bee. (Compl. ¶ 22.)

Shortly thereafter, SCIF became the subject of a criminal investigation and a state audit to address concerns of favoritism and conflicts of interest. (Compl. ¶ 50.) Vierria alleges that Devereux, an attorney of record for CHP and a Board of Trustee Member at SCIF, engaged in the theft of State funds by contracting with companies with whom he had a personal financial interest. (Compl. ¶ 40.) Castle, a former employee of SCIF, is the Staff Service Manager of the DRS at CHP. (Compl. ¶¶ 24-25.) Vierria alleges Castle used his knowledge and relationships obtained at SCIF to gain advantageous settlements for retiring Assistant and Deputy Chiefs claiming disabilities upon retirement. (Id.) Further, Castle would force out CHP employees that questioned the fraudulent practices between DRS and SCIF and replace those employees with former SCIF employees loyal to Castle. (Compl. ¶¶ 26, 39.) Also, Castle directed questionable disability claims to former SCIF employees to keep unwarranted payouts quiet. (Compl. ¶ 26.) In March 2004, Steve Poizner, the California Insurance Commissioner, ordered an audit of SCIF. (Compl. ¶ 50.) SCIF was also the subject of a criminal investigation and a legislative hearing. (Id.)

In California, CHP has merged with the California State Police. (Compl. ¶ 17.) The merger increased CHP's responsibilities to include investigation of alleged misappropriated state funds and conflicts of interest at SCIF. (Compl. ¶ 32.) Simultaneously, SCIF determines and authorizes the disability retirements for CHP employees resulting in numerous "unjustified payouts." (Compl. ¶ 33.) Vierria alleges CHP engaged in a criminal conspiracy with SCIF to defraud the State of California of taxpayer funds and then concealed the nature and extent of their criminal activities. (Compl. ¶ 39.) In exchange, SCIF engaged in a pattern of approving CHP Assistant and Deputy Chiefs' unwarranted and excessive disability payments. (Compl. ¶¶ 41, 88.)

Vierria further alleges SCIF and CHP conspired to harass, humiliate, and bring false or exaggerated disciplinary charges against any CHP employee who protested the fraudulent practice. (Compl. ¶ 42.) Further, CHP and Castle would attempt to force non-compliant employees into the worker's compensation system in order to expose them to an investigation by SCIF. (Compl. ¶¶ 42, 67.) Once in the workers' compensation system, SCIF subjected "problem employees" to excessive and prolonged investigations, and depositions into private matters unrelated to the disabilities claims. (Compl. ¶ 42.)

As part of her job responsibilities, Vierria referred several "Chief's Disease" workers' compensation cases to CHP's Internal Affairs Fraud Unit for investigation. (Compl. ¶ 55.) Thereafter, Vierria became known as a "problem employee" for contesting and opposing a Deputy Chief's disability claim. (Id.)

On or about December 28, 2006, a co-worker filed a complaint against Vierria, alleging Vierria was planning to leak information to the Sacramento Bee about some workers' compensation claims. (Compl. ¶ 56.) In January 2007, CHP's Office of Internal Affairs ("OIA") began an investigation into whether Vierria was "thinking about" leaking information to the Sacramento Bee. (Compl. ¶ 57.)

On January 26, 2007, the OIA subjected Vierria to a four and one half hour interrogation. (Compl. ¶ 59.) During the interrogation, the OIA repeatedly threatened Vierria with disciplinary action, including dismissal, and "grilled [her] relentlessly about whether she leaked information." (Id.) The investigators also interrogated Vierria about unrelated personal matters, including her religious practices, in order to "force Vierria to confess to betraying CHP." (Id.)

In addition to the interrogation, CHP interviewed Vierria's co-workers, managers, and husband. (Compl. ¶ 62.) Again, CHP inquired about Vierria's personal matters such as sexual relationships and religious practices. (Id.) Once again, these inquiries were unrelated to whether Vierria was "thinking about" leaking information to the Sacramento Bee. (Id.) Vierria alleges the interrogation and scrutiny CHP forced her to endure was intended to scare Vierria and other DRS employees from reporting specific cases of "Chief's Disease" misconduct. (Compl. ¶ 61.)

On May 15, 2007, the OIA issued a report of its investigation which concluded that Vierria did not release confidential information to the Sacramento Bee. (Compl. ¶¶ 70, 71.) However, the report included four unrelated allegations of improper conduct and recommenced that adverse action against Vierria was appropriate. (Compl. ¶ 72.)

In July 2007, Vierria filed a workers' compensation claim for Post-Traumatic Stress Disorder and "compassion fatigue." (Compl. ¶¶ 53, 65.) Devereux, a senior workers' compensation attorney at SCIF, handled Vierria's claim. (Compl. ¶¶ 34, 67.) Although four physicians agreed that Vierria's physical and emotional symptoms were caused by work-related stressors and approved three months leave, Devereux subjected Vierria to a second phase of a "sham investigation" to force Vierria into confessing to being the Sacramento Bee informant. (Compl. ¶¶ 65, 68.) Under direction of CHP and Castle, Devereux subjected Vierria to six days of "relentless" depositions. (Compl. ¶¶ 67-68.) During the depositions, Devereux attempted to coerce Vierria into "admitting she had worked with another person to leak information" by "grilling" her about a personal relationship with a former CHP Captain. (Compl. ¶ 68.) Further, Devereux used his authority under SCIF to hire two investigating services to investigate Vierria's workplace injury claim. (Compl. ¶ 69.) The investigators asked questions of witnesses that went beyond Vierria's claim to further the "sham investigation."*fn3 (Id.)

On September 5, 2007, CHP retaliated against Vierria by serving her with a notice of adverse action, suspending her for ten days and transferring her out of DRS. (Compl. ¶¶ 73, 75.) CHP justified the adverse action by citing the accusation that Vierria was "thinking about" leaking information and the OIA report. (Compl. ¶ 75.) Further, CHP intimidated and humiliated Vierria by "poisoning her new work environment and continuing the "on-going stigma of [Vierria] as a traitor" by serving Vierria an amended notice of adverse action on January 30, 2008. (Compl. ¶ 76.)

In December 2008, the State Personnel Board overturned the decision of CHP to transfer and suspend Vierria. (Compl. ¶ 77.) However, Vierria resigned in the wake of the never-ending investigation and harassment, alleging a constructive termination. (Id.)


I. Motion to Dismiss

On a motion to dismiss, the allegations of the complaint must be accepted as true. Cruz v. Beto, 405 U.S. 319, 322 (1972). The court is bound to give the plaintiff the benefit of every reasonable inference to be drawn from the "well-pleaded" allegations of the complaint. Retail Clerks Int'l Ass'n v. Schermerhorn, 373 U.S. 746, 753 n.6 (1963). Thus, the plaintiff need not necessarily plead a particular fact if that fact is a reasonable inference from facts properly alleged. See id.

Nevertheless, it is inappropriate to assume that the plaintiff "can prove facts which it has not alleged or that the defendants have violated the... laws in ways that have not been alleged." Associated Gen. Contractors of Calif., Inc. v. Calif. State Council of Carpenters, 459 U.S. 519, 526 (1983). Moreover, the court "need not assume the truth of legal conclusions cast in the form of factual allegations." United States ex rel. Chunie v. Ringrose, 788 F.2d 638, 643 n.2 (9th Cir. 1986). Indeed, "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Ashcroft v. Iqbal, --- U.S. ---, 2009 U.S. LEXIS 3472, at *29 (May, 18, 2009)(citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)).

In ruling upon a motion to dismiss, the court may consider only the complaint, any exhibits thereto, and matters which may be judicially noticed pursuant to Federal Rule of Evidence 201. See Mir v. Little Co. of Mary Hospital, 844 F.2d 646, 649 (9th Cir. 1988); Isuzu Motors Ltd. v. Consumers Union of United States, Inc., 12 F. Supp.2d 1035, 1042 (C.D. Cal. 1998).

Ultimately, the court may not dismiss a complaint in which the plaintiff alleged "enough facts to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, --- U.S. ---, 2009 U.S. LEXIS 3472, at *29 (May, 18, 2009)(citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Only where a plaintiff has failed to "nudge [his or her] claims across the line from conceivable to plausible," is the complaint properly dismissed. Id. When there are well-pleaded factual allegations, "a court should assume their veracity and then determine whether they plausibly give rise to an entitlement to relief." Id.

II. Motion to Amend

Federal Rules of Civil Procedure 15(a) states that "[t]he court should freely give leave when justice so requires." "Leave to amend should be granted unless amendment would cause prejudice to the opposing party, is sought in bad faith, is futile, or creates undue delay." Martinez v. Newport Beach, 125 F. 3d 777, 785 (9th Cir. 1997).


I. RICO Claim (All Defendants)

Vierria alleges defendants engaged in a pattern of racketeering activity in violation of 18 U.S.C. §§ 1962(c), (d). Section 1962(c) makes it "unlawful for any person employed by or associated with" an enterprise engaged in or affecting interstate commerce "to conduct or participate, directly or indirectly, in the conduct of such enterprise's affairs through a pattern of racketeering activity." Further, Section 1962(d) provides that "[i]t shall be unlawful for any person to conspire to violate any of the provisions of subsection (a), (b), or (c) of [Section 1962]." Thus, to allege a valid RICO claim, plaintiff must allege that defendants engaged in, or conspired to engage in:

(1) conduct, (2) of an enterprise, (3) through a pattern, (4) of racketeering activity, (5) that proximately caused (6) damages to plaintiff. See Sigmond v. Brown, 828 F.2d 8, 8 (9th Cir. 1987); Sedima v. Imrex Co., Inc., 473 U.S. 479, 496 (1985).

Vierria alleges defendants engaged in, or conspired to engage in, a pattern of prohibited racketeering activities including "witness, victim or informant tampering" (18 U.S.C. § 1512(b)), "theft or embezzlement from [an] employee benefit plan" (18 U.S.C. § 644), and "retaliation" for providing a law enforcement officer truthful information relating to the commission or possible commission of a federal crime (18 U.S.C. § 1513(e), (f)). Defendants argue, inter alia, (1) CHP and Castle are immune from the RICO claim under the doctrine of sovereign immunity, and Vierria fails to allege sufficient facts to establish (2) Castle was a part of a ...

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