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Ryan v. Santa Clara Valley Transportation Authority

United States District Court, N.D. California, San Jose Division

March 30, 2017

JOSEPH RYAN, Plaintiff,
v.
SANTA CLARA VALLEY TRANSPORTATION AUTHORITY, et al., Defendants.

          ORDER GRANTING IN PART AND DENYING IN PART MOTION TO DISMISS RE: DKT. NO. 41

          LUCY H. KOH UNITED STATES DISTRICT JUDGE.

         Plaintiff Joseph Ryan (“Plaintiff”) sues Defendants Santa Clara Valley Transportation Authority (“SCVTA”) and Joseph Fabela (“Fabela”) (collectively, “Defendants”). ECF No. 37. Before the Court is Defendants' motion to dismiss. ECF No. 41 (“Mot.”). Having considered the submissions of the parties, the relevant law, and the record in this case, the Court hereby GRANTS in part and DENIES in part Defendants' motion to dismiss.

         I.BACKGROUND

         A. Factual Background

         SCVTA “is an independent special district agency that provides” public transportation services in Santa Clara County, California. ECF No. 37 (Second Amended Complaint, or “SAC”), ¶¶ 10, 23. Fabela is the General Counsel for SCVTA. Id. ¶ 8. Plaintiff was employed at SCVTA in the position of Senior Assistant Counsel. Id. ¶ 23.

         SCVTA also employed an individual named David Terrazas (“Terrazas”). Id. ¶ 26. Plaintiff “complained to management” during his time at SCVTA “that Terrazas was incompetent.” Id. According to the SAC, “[t]he fact that Terrazas was a poor performer was widely known by management and recognized by [Fabela] and legal staff” at SCVTA. Id.

         Terrazas was also a member of the Santa Cruz City Council. Id. ¶ 27. In June 2014, Plaintiff “published for one day an internet webpage entitled ‘Anyone But Terrazas For City Council.'” Id.¶¶ 28, 45. Plaintiff published this on his Facebook page. Id. ¶ 41. Plaintiff's posting was “critical of Terrazas' campaign for re-election to City Council in 2014, ” and Plaintiff “cite[d] some misrepresentations listed on Terrazas' campaign web page, including the misrepresentation that Terrazas was a ‘Transportation Manager, ' rather than the true fact that he was a ‘Labor Relations Supervisor'” at SCVTA. Id. ¶ 28. Plaintiff alleges that Plaintiff made the speech “on his own time, at night after working hours, using his own computer equipment.” Id. ¶¶ 29, 43.

         In February 2015, Terrazas alleged that SCVTA and Plaintiff “retaliated against Terrazas for whistleblower activity.” Id. ¶ 26-27. The SAC does not identify Terrazas's “whistleblower activity, ” or how Terrazas was retaliated against.

         Also in February 2015, Plaintiff informed Fabela that Plaintiff had made the webpage posting about Terrazas in June 2014. Id. ¶ 29. Fabela “was provided with a printout of the webpage.” Id. Plaintiff “informed [Fabela] that the webpage was protected off-duty political activity.” Id. Fabela did not take any action against Plaintiff at that time.

         On June 3, 2015, Terrazas entered into a settlement agreement with SCVTA regarding the retaliation that Terrazas allegedly suffered. Id. ¶ 30. Nuria Fernandez (“Fernandez”), the General Manager of SCVTA, signed the settlement agreement with Terrazas on June 5, 2015. Id.

         That same day, June 5, 2015, Fabela “informed [Plaintiff] that he would be terminated by [SCVTA] or that he could retire, but that [Plaintiff] must leave the office that day.” Id. ¶ 31. “When [Plaintiff] asked [Fabela] why” he was being terminated, Fabela “replied that the action was taken for reasons previously discussed, referring to the previous discussion regarding Mr. Ryan's aforementioned webpage.” Id. ¶ 31.

         The SAC further alleges that Plaintiff is Caucasian, over the age of 40, and that he “suffered from a medical condition” during his employment that “substantially limited his ability to sleep, walk, stand, lift, bend, concentrate, tolerate substandard performance by coworkers and perform manual tasks at work and at home.” Id. ¶ 33-34.

         B. Procedural History

         Plaintiff filed suit on July 18, 2016, against SCVTA, Fabela, and Fernandez. ECF No. 1. Plaintiff's complaint alleged 22 causes of action against Defendants, including claims under 42 U.S.C. § 1983; Title VII of the Civil Rights Act of 1964 (“Title VII”); the Age Discrimination in Employment Act (“ADEA”), 29 U.S.C. § 621; the Americans with Disabilities Act (“ADA”), 42 U.S.C. § 12101; and violations of California state law. See id.

         On September 29, 2016, the parties filed a stipulation regarding Plaintiff's filing of a First Amended Complaint. ECF No. 18. Specifically, the parties agreed that Plaintiff would dismiss Fernandez with prejudice, that Plaintiff would “[r]emove any and all allegations that Plaintiff was entitled to a ‘Skelly' hearing, and that [SCVTA]'s failure to provide Plaintiff a ‘Skelly' hearing constituted a due process violation.” Id. Plaintiff also stipulated to dismiss the Complaint's twentieth cause of action. Id. The Court entered an Order granting the parties' stipulation on September 30, 2016. ECF No. 19.

         On October 17, 2016, Plaintiff filed a First Amended Complaint. ECF No. 26. On that same day, Plaintiff filed a notice of voluntary dismissal of Fernandez, ECF No. 27, which this Court granted on October 19, 2016, ECF No. 29.

         On November 9, 2016, the parties filed a stipulation regarding Plaintiff's filing of a SAC, ECF No. 32, which the Court granted that same day, ECF No. 34.

         On December 14, 2016, Plaintiff filed the SAC. The SAC alleged 13 causes of action against Defendants, including claims under § 1983 for violation of Plaintiff's First Amendment rights, claims under § 1983 for violation of Plaintiff's Fourteenth Amendment rights, claims under Title VII and FEHA for racial discrimination and retaliation, claims under the ADEA and California's Fair Housing and Employment Act (“FEHA”) for age discrimination, claims under the ADA and FEHA for disability discrimination, and a claim for violation of California Government Code § 3202.

         On January 13, 2017, Defendants filed a motion to dismiss the SAC or, in the alternative, a motion for more definite statement or a motion to strike. ECF No. 41 (“Mot.”). On January 27, 2017, Plaintiff filed an opposition and a request for judicial notice. ECF Nos. 47 & 48. On February 3, 2017, Defendants filed a Reply, a request for judicial notice, and oppositions to Plaintiff's request for judicial notice. ECF Nos. 49, 50, 51.

         II.LEGAL STANDARD

         A. Motion to Dismiss Under Rule 12(b)(6)

         Pursuant to Federal Rule of Civil Procedure 12(b)(6), a defendant may move to dismiss an action for failure to allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a ‘probability requirement, ' but it asks for more than a sheer possibility that a defendant has acted unlawfully.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal citation omitted).

         For purposes of ruling on a Rule 12(b)(6) motion, the Court “accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). However, a court need not accept as true allegations contradicted by judicially noticeable facts, Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000), and a “court may look beyond the plaintiff's complaint to matters of public record” without converting the Rule 12(b)(6) motion into one for summary judgment, Shaw v. Hahn, 56 F.3d 1128, 1129 (9th Cir. 2011). Mere “conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss.” Adams v. Johnson, 355 F.3d 1179, 1183 (9th Cir. 2004).

         B. Leave to Amend

         If the Court concludes that a motion to dismiss should be granted, it must then decide whether to grant leave to amend. Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to amend “shall be freely given when justice so requires, ” bearing in mind “the underlying purpose of Rule 15 . . . [is] to facilitate decision on the merits, rather than on the pleadings or technicalities.” Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (citation omitted). Nonetheless, a district court may deny leave to amend a complaint due to “undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party by virtue of allowance of the amendment, [and] futility of amendment.” See Leadsinger, Inc. v. BMG Music Publ'g, 512 F.3d 522, 532 (9th Cir. 2008).

         III. DISCUSSION

         Defendants move to dismiss all 13 claims raised in the SAC. Plaintiff's claims may be grouped into the following categories: (1) claims under § 1983 for violation of the First Amendment; (2) a claim under California Government Code § 3203; (3) claims under § 1983 for violation of the Fourteenth Amendment; (4) claims for racial discrimination; (5) claims for age discrimination; (6) claims for disability discrimination; and (7) claims for retaliation for reporting racial discrimination. Defendant also moves to dismiss Plaintiff's request for punitive damages. The Court addresses each of Defendants' arguments below in turn.

         A. Section 1983 Claims for Violation of the First Amendment

         Counts One and Two of Plaintiff's SAC allege that Defendants violated § 1983 by terminating Plaintiff in retaliation for Plaintiff's exercise of his First Amendment right to free speech.[1] SAC ¶¶ 36-74. Plaintiff brings a claim against Fabela in his individual capacity, and a claim against SCVTA based on Monell v. Dep't of Soc. Servs., 436 U.S. 658 (1978). Id. The Court first considers Plaintiff's claim against Fabela, and then the Court considers Plaintiff's § 1983 claim against SCVTA under Monell.

         1. Claim against Fabela in his Individual Capacity

         Count One of Plaintiff's SAC alleges that Fabela violated the First Amendment by terminating Plaintiff in retaliation for Plaintiff posting the “Anyone But Terrazas For City Council” webpage. SAC ¶ 47. According to Defendants, Plaintiff's claim against Fabela must be dismissed because Plaintiff has failed to plausibly allege a First Amendment retaliation claim. Mot. at 5-13. Defendants also assert that Fabela is entitled to qualified immunity. Id. at 17. The Court first addresses whether Plaintiff has stated a plausible claim against Fabela for First Amendment retaliation, and then the Court considers whether Fabela is entitled to qualified immunity.

         a. Whether Plaintiff has Stated a Plausible Claim against Fabela for First Amendment Retaliation

         “The First Amendment shields public employees from employment retaliation for their protected speech activities.” Hagen v. City of Eugene, 736 F.3d 1251, 1257 (9th Cir. 2013). The Ninth Circuit “follow[s] a sequential five-step inquiry to determine whether an employer impermissibly retaliated against an employee for engaging in protected speech.” Ellins v. City of Sierra Madre, 710 F.3d 1049, 1056 (9th Cir. 2013). “First, the plaintiff bears the burden of showing: (1) whether the plaintiff spoke on a matter of public concern; (2) whether the plaintiff spoke as a private citizen or public employee; and (3) whether the plaintiff's protected speech was a substantial or motivating factor in the adverse employment action.” Id. (quoting Robinson v. York, 566 F.3d 817, 822 (9th Cir. 2009) (internal quotation marks and citations omitted). “Next, if the plaintiff has satisfied the first three steps, the burden shifts to the government to show: (4) whether the state had an adequate justification for treating the employee differently from other members of the general public; and (5) whether the state would have taken the adverse employment action even absent the protected speech.” Id.

         Defendants argue that Plaintiff has failed to allege the first three steps of this inquiry: that Plaintiff “spoke on a matter of public concern, ” that Plaintiff “spoke as a private citizen, ” or that Plaintiff's “protected speech was a substantial or motivating factor” in Plaintiff's termination. Ellins, 710 F.3d at 1056; see Mot. at 6-13. The Court considers each of these steps below.

         i. Matter of Public Concern

         The Court first considers whether Plaintiff has adequately alleged that Plaintiff's “Anyone But Terrazas For City Council” webpage “spoke on a matter of public concern.” Ellins, 710 F.3d at 1056. “Speech involves a matter of public concern when it can fairly be considered to relate to ‘any matter of political, social, or other concern to the community.'” Johnson v. Multnomah Cty., 48 F.3d 420, 422 (9th Cir. 1995) (quoting Connick v. Myers, 461 U.S. 138, 146 (1983)). By contrast, when a public employee speaks “upon matters only of personal interest . . . a federal court is not the appropriate forum in which to review the wisdom of a personnel decision taken by a public agency allegedly in reaction to the employee's behavior.” Connick, 461 U.S. at 147.

         The Ninth Circuit has recognized that “[t]he scope of the public concern element is defined broadly in recognition that one of the fundamental purposes of the first amendment is to permit the public to decide for itself which issues and viewpoints merit its concern.” Ulrich v. City and Cty. of San Francisco, 308 F.3d 968, 978 (9th Cir. 2002). “It is only ‘when it is clear that . . . the information would be of no relevance to the public's evaluation of the performance of governmental agencies' that speech of government employees receives no protection under the First Amendment.” Id. (quoting Pool v. VanRheen, 297 F.3d 899, 907 (9th Cir. 2002)). The Ninth Circuit has found that speech is not of public concern where it reflects “the minutiae of workplace grievances, ” Havekost v. U.S. Dep't of Navy, 925 F.2d 316, 319 (9th Cir. 1991), or “individual personnel disputes.” McKinley v. City of Eloy, 705 F.2d 1110, 1114 (9th Cir. 1983). In determining whether speech addresses a matter of public concern, the Court must look to “the content, form, and context of a given statement, as revealed by the whole record.” Connick, 461 U.S. at 147-48. For the reasons discussed below, the Court finds that the alleged “content, form, and context” of Plaintiff's speech plausibly suggest that Plaintiff spoke on a matter of public concern. See id.

         First, the Court considers the alleged “content” of Plaintiff's speech. Plaintiff alleges that he posted a webpage entitled “Anyone But Terrazas For City Council, ” that was “critical of Terrazas' campaign for re-election to City Council.” SAC ¶ 28. Plaintiff further alleges that he “cit[ed] some misrepresentations listed on Terrazas' campaign web page, including the misrepresentation that Terrazas was a ‘Transportation Manager, ' rather than the true fact that he was a ‘Labor Relations Supervisor.'” Id. This alleged “content, ” which was about a local candidate's campaign for public office, plausibly suggests that Plaintiff spoke on a “matter of political, social, or other concern to the community.” See Johnson, 48 F.3d at 422 (internal quotation marks omitted); Wiggins v. Lowndes Cty., Miss., 363 F.3d 387, 390 (5th Cir. 2004) (“Political speech regarding a public election lies at the core of matters of public concern protected by the First Amendment.”).

         Second, the Court considers the alleged “form” and “context” of Plaintiff's speech. “The relevant inquiry is the point of the speech in question.” Lopez v. City & Cty. of San Francisco, 2014 WL 2943417, at *6 (N.D. Cal. June 30, 2014) (citing Roth v. Veteran's Admin. of U.S., 856 F.2d 1401, 1406 (9th Cir. 1988)). Here, Plaintiff alleges that Plaintiff posted the webpage on a public forum, the internet, “to shed light on the candidate's wrongdoing for the public.” Id. ¶ 41. Moreover, Plaintiff alleges that his speech was intended to be “about a candidate running for public office.” Id. Taken as true, these ...


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