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Tanner v. Kaiser Foundation Health Plan, Inc.

United States District Court, N.D. California, Oakland Division

August 1, 2016

DR. SCOTT TANNER, an individual, Plaintiff,
v.
KAISER FOUNDATION HEALTH PLAN, INC., a California corporation, KAISER FOUNDATION HOSPITALS, a California corporation, NORTHERN CALIFORNIA PERMANENTE MEDICAL GROUP, INC., a California corporation, and DOES 1-50, Defendants.

          ORDER GRANTING MOTION TO DISMISS

          SAUNDRA BROWN ARMSTRONG Senior United States District Judge

         Plaintiff Scott Tanner (“Plaintiff”) filed the instant pro se action against his former employers Kaiser Foundation Health Plan, Inc., Kaiser Foundation Hospitals, and The Permanente Medical Group, Inc. (“TPMG, ” erroneously sued as Northern California Permanente Medical Group, Inc.) (collectively, “Kaiser” or “Defendants”). Plaintiff seeks to rescind his employment separation agreement with Kaiser, including the comprehensive release of claims contained therein. Upon rescinding the same, Plaintiff further seeks to prosecute claims for wrongful termination, discrimination, and retaliation.

         The parties are presently before the Court on Defendants’ Motion to Dismiss Plaintiff’s Amended Complaint, pursuant to Federal Rule of Civil Procedure 12(b)(6). Dkt. 37. Having read and considered the papers filed in connection with this matter and being fully informed, the Court hereby GRANTS Defendants’ motion, for the reasons stated below. The Court, in its discretion, finds this matter suitable for resolution without oral argument. See Fed.R.Civ.P. 78(b); N.D. Cal. Civ. R. 7-1(b).

         I. BACKGROUND

         A. Factual Summary

         In 2000, Plaintiff began working for the Kaiser Permanente Outpatient Pharmacy Department. First Am. Compl. (“FAC”) ¶ 14, Dkt. 33. Plaintiff served as a staff pharmacist, a lead pharmacist, a pharmacist supervisor, and finally, in late 2010, as Pharmacist-In-Charge at Kaiser’s Manteca location. Id.

         The allegations of Plaintiff’s 56-page FAC (like his 69-page original complaint) are profuse and discursive. In brief, between 2010 and 2012, Plaintiff was allegedly subject to harassment, discrimination, and retaliation at work. FAC ¶¶ 14-66. Plaintiff is a white male, over the age of 40, with an undisclosed “physiological serious health condition/physical disability.” Id. ¶¶ 88, 94, 103. During the relevant period, Kaiser’s pharmacy staff in Manteca was 85-90% Asian, female, and under the age of forty. Id. ¶ 103. According to Plaintiff, he suffered adverse employment consequences based on his color, gender, and age, as well as his disability, for which Defendants allegedly failed to provide adequate accommodation. Id. ¶¶ 90, 94-95, 103-104, 115-116.

         In addition, Plaintiff asserts that he suffered harassment and retaliation based on the aforementioned factors (i.e., his color, gender, age, and disability), as well as for “[his] complaints about [other employees’] misconduct affecting patient safety and care.” FAC ¶ 123. Among other allegations of misconduct, Plaintiff claims that Defendants failed to respond to reports of unlawful drug diversion (i.e., theft) and drug furnishing irregularities (i.e., pharmacist errors). Id. ¶ 125. Plaintiff also alleges that Defendants failed to take all reasonable steps to prevent further discrimination and harassment. Id. ¶¶ 133, 135.

         Finally, Plaintiff alleges that Kaiser engages in unlawful business practices. FAC ¶ 151. According to Plaintiff, Defendants: (1) did not adequately compensate him and others like him; (2) did not allocate sufficient funds for “community benefit expenditures”; and (3) earned profits through 501(c)(3) tax-exempt entities, and then funneled said profits to its related for-profit entities, such as TPMG. Id. ¶¶ 141-157.

         On November 15, 2012, after a purported two-year campaign against Plaintiff by his co-workers, which allegedly included verbal abuse, interference with his work performance, and exacerbation of his health condition, FAC ¶¶ 26-32, Kaiser suspended Plaintiff from work, id. ¶¶ 33-35. Kaiser stated that the suspension “was [a] non-punitive investigation, ” and reduced Plaintiff’s salary by 50%. Id. Plaintiff alleges that Kaiser did not inform him of the reason for the suspension. Id.

         While suspended, Plaintiff received materials regarding the 2012 Employee Choice Program (“ECP”). FAC ¶ 37. ECP was a “voluntary separation incentive program” that Kaiser offered to various employees in Northern California. Request for Jud. Not. (“RJN”), Ex. 1(A) at p. 2, Dkt. 38. ECP offered eligible employees an opportunity to terminate their employment voluntarily in exchange for severance pay and medical/dental coverage. Id. On December 23, 2012, Plaintiff executed a Separation Agreement and General Release (the “Separation Agreement”) to take advantage of ECP. FAC ¶ 38; RJN, Ex. 1 at p. 1, 7.[1]

         The Separation Agreement includes a provision entitled “Complete Release of Claims, ” which released Defendants from all claims of any kind arising out of or related to Plaintiff’s employment and/or termination. RJN, Ex. 1 at p. 3. The release

includes, but is not limited to, all claims based in tort or contract, or under any federal, state, or local statute, ordinance, or common law, including, but not limited to, the Age Discrimination in Employment Act [“ADEA”], Title VII of the Civil Rights Act [“Title VII”], the Americans with Disabilities Act [“ADA”], the California Fair Employment and Housing Act [“FEHA”], or any claim of discrimination, harassment, breach of contract or public policy, wrongful or retaliatory discharge and all claims for compensation, vacation, attorney’s fees, wrongful denial of insurance and employee benefits.

Id. Plaintiff’s employment terminated effective February 11, 2013, and he received 16 weeks of severance pay totaling $45, 558.78, plus other benefits. Id. at p. 1-2.

         Plaintiff now alleges that he executed the Separation Agreement under duress, menace, and/or undue influence, and therefore, that he is entitled to rescind the agreement. FAC ¶¶ 67-86. With regard to duress, Plaintiff alleges that several factors--Kaiser’s refusal to accommodate his health condition, his suspension (with 50% reduction in pay), and the risk of termination--induced him to sign the Separation Agreement. Id. ¶¶ 69-74. With regard to menace, Plaintiff further alleges that he signed the Separation Agreement “to escape” ongoing harassment and threats that he endured at work and/or from his coworkers. Id. ¶¶ 75-82. Finally, with regard to undue influence, Plaintiff alleges that, because of his health condition and the aforementioned hostile work environment, he suffered a weakness of spirit that rendered him unable to exercise independent judgment when executing the Separation Agreement. Id. ¶¶ 83-86.

         B. Procedural History

         On April 21, 2015, Plaintiff filed suit against Defendants in state court, alleging claims for: (1) Unlawful Attainment of Invalid Separation Agreement; (2) Age Discrimination in Violation of ADEA and FEHA; (3) Disability Discrimination in Violation of ADA and FEHA; (4) Race, Color, Gender, and National Origin Discrimination in Violation of Title VII and FEHA; (5) Failure to Accommodate Disability; (6) Retaliation; (7) Failure to Prevent Discrimination, Harassment or Retaliation; (8) Unlawful Business Practices; and (9) Constructive Discharge in Violation of Public Policy. Dkt. 1. Defendants removed the instant action to this Court based on federal-question jurisdiction. Id.

         On June 26, 2015, Defendants filed a motion to dismiss the Complaint, arguing that Plaintiff: (1) failed to allege facts sufficient to support a claim for rescission of the Severance Agreement, and (2) had released all remaining claims under that agreement. Dkt. 6. On December 3, 2015, the Court granted Defendant’s motion. Order, Dkt. 32. The Court found that Plaintiff failed to state facts sufficient to support a claim for rescission of the Separation Agreement, which, in turn, barred any cause of action arising out of his employment and termination. The Court further held that, with the exception of the eighth cause of action for unlawful business practices, Plaintiff’s claims arose entirely out of his employment and termination. With regard to the eighth cause of action, Plaintiff appeared to predicate the claim on violations of both the California Labor Code (“CLC”) and the Internal Revenue Code (“IRC”). The Court found that (1) the Separation Agreement served as a bar to Plaintiff’s claim insofar as it arose out of alleged CLC violations, and (2) Plaintiff lacked standing to raise the claim insofar as it arose out of alleged IRC violations. The Court granted Plaintiff leave to amend his claims, except for the ninth cause of action for constructive discharge, which is time-barred.

         On December 16, 2015, Plaintiff filed the operative First Amended Complaint, re-alleging the first through eighth causes of action. Dkt. 33. Thereafter, Defendants filed the instant Motion to Dismiss Plaintiff’s Amended Complaint. Dkt. 37. The motion is fully briefed and ripe for adjudication.

         II. L ...


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