United States District Court, N.D. California
Decided: August 7, 2013.
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For Vinay Karamsetty, on behalf of himself and all others similarly situated, Plaintiff: Allison Hughes Goddard, James Richard Patterson, LEAD ATTORNEYS, Patterson Law Group, APC, San Diego, CA.
For Wells Fargo & Company, a Delaware corporation, Wells Fargo Company Salary Continuation Pay Plan, an ERISA Plan, Defendants: Kathleen Cahill Slaught, LEAD ATTORNEY, Seyfarth Shaw, San Francisco, CA; D. Ward Kallstrom, Seyfarth Shaw LLP, San Francisco, CA; Michelle Marie Scannell, Seyfarth Shaw LLP, SF, CA.
ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT, OR IN THE ALTERNATIVE, SUMMARY ADJUDICATION; AND OVERRULING PLAINTIFF'S OBJECTIONS TO THE DECLARATIONS OF LAURA HURLEY AND KATHLEEN CAHILL SLAUGHT Dkt. Nos. 42, 50, 54
JOSEPH C. SPERO, United States Magistrate Judge.
This action arises under the Employee Retirement Income Security Act of 1974 (" ERISA" ), 29 U.S.C. § § 1101 et seq. Plaintiff Vinay Karamsetty (" Plaintiff" ) filed this lawsuit against Defendants Wells Fargo & Company (" Wells Fargo" ) and Wells Fargo Company Salary Continuation Pay Plan (" the Plan" ). Plaintiff, a citizen of India, had been a Wells Fargo employee since 2007. In 2009, due to Wells Fargo's acquisition of Wachovia Mortgage and the then-current economic climate, Wells Fargo implemented a new policy to stop its employer-sponsorship of immigrant visa applications and extensions. Plaintiff resigned from his position at Wells Fargo in February 2010 before his visa expired in June 2010. Plaintiff submitted a claim for severance benefits under the Plan, and the claim was denied.
Plaintiff brings this lawsuit under ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), contending he is entitled to severance benefits because Wells Fargo's refusal to renew his visa is a qualifying event under the Plan. Plaintiff also brings a claim under ERISA § 510, 29 U.S.C. § 1140, contending that Wells Fargo's implementation of the policy not to renew immigrant visas was intended to interfere with Plaintiff's right to severance benefits owed to him under the Plan. Defendants filed a Motion for Summary Judgment, or in the Alternative, Summary Adjudication (" Motion" ), as to both claims. The Court held a hearing on the Motion on June 28, 2013, at 9:30 a.m. For the reasons explained below, the Motion is GRANTED.
A. Factual Background
On or about July 17, 2007, Plaintiff began working as a Web Developer in Wells Fargo's Internet Services Group, earning an annual salary of approximately $115,000. Dkt. No. 42-1 (Joint Statement of Undisputed Material Facts) (" JSUF" ) ¶ 12. Plaintiff is a citizen of India. At the time Plaintiff commenced employment at Wells Fargo, he was eligible to work in the United States pursuant to an employer-sponsored H1-B visa that was set to expire in approximately June 2010. Id. ¶ 13. However, in March 2009, Wells Fargo changed its policy regarding its sponsorship of employee visas (hereafter " the Policy" ). Id. ¶ 14.
While there is no evidence that the full Policy has ever been documented, there is a written " Summary of the Policy" which was provided to the Human Resources (" HR" ) division of Wells Fargo. Declaration of Laura Hurley in Support of Defendants
Motion for Summary Judgment (" Hurley Decl." ) Ex. A at WF 400-03. The Summary of the Policy states that its " purpose is to provide the HR community clarification regarding visa sponsorship going forward." Id. The next line states that " [d]ue to the merger of the companies and the current economic climate, Wells Fargo found it necessary to re-evaluate our visa sponsorship practices." Id. The Summary of the Policy states that Wells Fargo will end its practice of sponsoring visa applications for new employees and visa extensions and renewals for its current employees, but also allows for limited exceptions. See id.
On March 30, 2009, HR Managers at Wells Fargo were sent an email labeled " confidential" which updated them on the progress of Wells Fargo's visa Policy. Declaration of Allison H. Goddard in Support of Plaintiff's Opposition to Defendants' Motion for Summary Judgment (" Goddard Decl." ), Ex. 8. The email reiterated that " Wells Fargo found it necessary to re-evaluate our visa sponsorship practices due to the merger and the current economic climate." Id. One part of the email read: " You may have a team member on a visa or their manager ask you about salary continuation in these situations. In the attached you will find the response that Corporate legal has provided." Id.
The email included an attachment entitled " Wells Fargo Visa Sponsorship - Talking Points for TOG HR." One of the talking points stated the following:
There have been some inquiries from team members whether they are eligible for severance if the company is making the decision not to renew or sponsor visas. The response Corporate legal has crafted for HR to use is as follows:
Eligibility for severance benefits is based on a change to a team member's position (such as job elimination, work location or salary reduction), not the team member's employment eligibility status. If a team member is not employment eligible, he/she cannot continue to be employed at Wells Fargo. Wells Fargo, like other employers, may chose [sic] to sponsor employees on employment-sponsored visas, such as H1-Bs, but it is not a requirement that Wells Fargo do so. The fact that Wells Fargo has chosen not to sponsor a team member for a employer-sponsor [sic] visa does not trigger salary continuation benefits.
Id. at 227-28 (emphasis in original).
Plaintiff first learned about the Policy from an article in the Wall Street Journal. Goddard Decl., Ex. 11. On April 1, 2009, Plaintiff wrote an email to a Wells Fargo HR employee inquiring whether the article was true. Id. The HR employee, Kate Jones, first forwarded the email to a coworker, asking: " What the heck should I say to him?" Id. Ms. Jones then responded to Plaintiff's email later that day:
There is no general email going out to H1B visa holders about letting the visa's expire - we're not sure where this email came from or who it went to. We are however looking at our H1B's visa's [sic] on a case by case basis and should have more information soon.
Goddard Decl. Ex. 12 at 239.
On April 6, 2009, Plaintiff's supervisor Lawrence Hsu personally informed Plaintiff that Wells Fargo decided not to renew his visa when it expired in June 2010. JSUF ¶ 15. Mr. Hsu had been instructed by HR that he should only have verbal conversations about this with Plaintiff and not to put anything in writing. Goddard Decl. Ex. 31 (Excerpts from the Deposition of Lawrence Hsu) (" Hsu Depo." ) at
35:20-24. Mr. Hsu could not recall any other time when HR had asked him not to put something in writing. Hsu Depo. at 35-37. Plaintiff was informed by memo dated April 17, 2009 that he could not post for other positions within Wells Fargo due to employer-based visa restrictions. JSUF ¶ 16.
The Summary of the Policy provides that current Wells Fargo employee visa-holders, with the help of their hiring managers and HR, may submit a request for a business case exception for Wells Fargo to sponsor the renewal of their visas. Hurley Decl. Ex. A at WF 401-02. HR managers were also told that " [w]here managers feel the role is critical to the business they may submit an updated business case," but also stated that " It is anticipated that very few business cases will be approved. Recruiting Consultants will set this expectation with managers." Goddard Decl. Ex. 8 at 227 (emphasis in original). There is a list of thirty-two Wells Fargo employees whose H-1B visas were extended even under the Policy. Hurly Decl. ¶ 9 and Ex. C thereto.
In April 2009, Mr. Hsu told Plaintiff that he would submit a business case exception on Plaintiff's behalf. Declaration of Kathleen Cahill Slaught in Support of Defendants' Motion for Summary Judgment (" Cahill Decl." ), Ex. A (Excerpts from the Deposition of Vinay Karamsetty) (" Karam. Depo." ) at 69:18-20. However, Mr. Hsu delayed in doing so, apparently under the belief that it would be better to wait until it was closer to the visa expiration date in June 2010. Id. at 68:12-19.
On February 16, 2010, Plaintiff told Mr. Hsu that he would be resigning. Plaintiff testified that at the time he wrote his resignation email, he understood that Mr. Hsu would file the extension anytime that month. Karam. Depo. at 69:1-6. Mr. Hsu testified that he was not surprised to learn that Plaintiff was ending his employment. He stated that " [b]ecause there was a policy that H-1Bs would not be renewed..., it was certainly understandable that he was looking out for something that was viable for him." Hsu Depo. at 58:5-12. Mr. Hsu also testified that he was not aware of any exceptions to the Policy that were granted. Hsu Depo. at 53:12-15. Mr. Hsu had informed Plaintiff of that fact. Karam. Depo. at 69:18-20.
At Mr. Hsu's request, Plaintiff followed-up with a resignation email:
Please accept this email as my two-weeks' notice of resignation. My last of work will be Mar 1st 2010.
While I have been very satisfied at Wells Fargo, I have decided to make this move to advance my career. I have enjoyed working with you and appreciate the opportunities I have been given here.
I will do my best to hand off my current projects prior to Mar 1st. Please let me know if you need my help in any other way.
Eggers Decl. Ex. A at 33; Goddard Decl. Ex. 32, Karam. Depo. at 57:20-25 - 58:1-2; see also JSUF ¶ 17. Plaintiff testified that even though the email states Plaintiff was leaving " to advance [his] career," Ms. Hsu knew the real reason Plaintiff was leaving was the expiration of his H1-B visa. Karam. Depo. at 58. Plaintiff explained that because he is not good with English phrases, he used a sample resignation letter he found on the internet to write this email. Id. at 58-60.
Plaintiff testified that prior to his last day of employment with Wells Fargo, he inquired at least twice whether he
would receive severance benefits, and whether he would receive severance benefits if he stayed to the last day of his eligibility circumstance. JSUF ¶ ¶ 18-19. Plaintiff testified that the answer to these questions on both occasions was " no." Id.
Plaintiff's last day of work was March 2, 2010. JSUF ¶ 20. Plaintiff attended an exit interview with Evelyn Dubon on that day. Id. ¶ 21. During the exit interview, Plaintiff informed Ms. Dubon that he was leaving due to Wells Fargo's Policy not to renew his visa and because he had found a new job. Eggers Decl. at 34. Plaintiff told Ms. Dubon that he felt there had been a " hidden message," as he was told H1-B visa extensions would be determined on a case by case basis, but had not heard of Wells Fargo sponsorship of anyone's visa renewal or extension. Plaintiff also stated that the Policy should have been treated as a layoff. Id. Because he had heard that the Policy was implemented due to the economic conditions and merger with Wachovia Mortgage, Plaintiff believed those affected by the Policy should have been considered to have experienced a displacement of position. Id. Plaintiff also stated that he felt like Wells Fargo discriminated against foreign nationals. Id. at 35.
At the interview, Plaintiff also inquired whether he would be eligible for severance benefits. Ms. Dubon said she did not believe so but would follow-up. Weeks later, Plaintiff wrote an email to Ms. Dubon asking about the possibility of benefits. Goddard Decl. Ex. 17 at 249. Plaintiff was directed to communicate with Kelly Francovich since Ms. Dubon was no longer working with the Internet Services Group. Id. Ms. Francovich wrote Plaintiff an email on September 28, 2010:
Team members become eligible for Wells Fargo's salary continuation plan when their positions are eliminated or there is a qualifying event that meets the definition of a substantial position change.
This is not the case with non renewal of H1B visas, therefore, you are not eligible to receive severance pay under our plan.
Goddard Decl. Ex. 17 at 248.
B. Wells Fargo's Displacement Selection Process
Wells Fargo laid-off thousands of workers after acquiring Wachovia Mortgage. See Eggers Decl. ¶ ¶ 5-6. HR employees at Wells Fargo were instructed to watch a two-hour PowerPoint lecture entitled " Selection Guidelines for Displacement Activities" to learn how to select which employees to include in the displacement process. See Goddard Decl. Ex. 6 (Selection Guidelines for Displacement Activities). " Selection Process" is defined in the PowerPoint as the " [m]ethod and process for identifying and selecting team members for displacement." Id. at 10. The objectives of this training were to teach HR employees appropriate selection methods and criteria, as well as the triggering events under the Plan which entitled employees to benefits. Id. at 7.
HR employees were also provided with a document entitled " Displacement Selection Process for Team Members on Employer-sponsored Visas and Student Visas." See Hurley Decl. Ex. B. This document states that it " describes the procedures for HR to use, in conjunction with the 'Selection Guidelines for Displacement Activities,' when the displacement selection process involves team members on employer sponsorships and certain student visas." Id. The document instructs HR employees to take certain steps " [a]fter HR has finished the evaluation of determining the appropriate candidate pool[.]" Id.
HR employees are first instructed to identify which Wells Fargo employees require
visas and to determine their corresponding expiration dates. Id. Then, HR employees are instructed to " [r]eview the work authorization expiration date to determine if the team member should be included in the selection process." Id. at 414. HR employees are instructed to follow the normal selection process for employees whose work authorizations expire after the date of the anticipated Notice Period, and are told that these employees will be eligible to receive severance benefits. Id.; see also Eggers Decl. ¶ 6 (" the Plan paid lump sum severance to individuals who held H1-B visas, whose visa expiration date followed their lump sum severance payout under the Plan." ). HR employees are also instructed to exclude from the selection process employees whose work authorizations expire before the end of the anticipated Notice Period, and further states that those employees will not be eligible for severance benefits. See Hurley Decl. Ex. B. at 414.
The " Displacement Selection Process for Team Members on Employer-sponsored Visas and Student Visas" ends with a " Q & A." One " Q & A" is as ...