United States District Court, S.D. California
WILLIAM Q. HAYES United States District Judge.
matter before the Court is the motion for summary judgment
filed by Defendant Hologic, Inc. (ECF No. 39).
November 18, 2015, Plaintiff Karmen Smiley initiated this
action by filing a complaint in Superior Court in the State
of California for the County of San Diego alleging two causes
of action against Defendant Hologic, Inc.: (1) retaliatory
termination in violation of California Labor Code section
1102.5, and (2) wrongful termination in violation of public
policy. (ECF No. 1-2). Plaintiff's second cause of action
alleges that her wrongful termination violates two public
policies: (1) “for employers not to retaliate against
an employee for disclosing information to another employee
with the authority to investigate or correct violations where
the employee has reasonable cause to believe that the
information discloses a violation of state or federal statute
or a violation or non-compliance with a state or federal rule
or regulation”, and (2) “to neither discharge,
nor formerly discipline, nor otherwise discriminate against
an employee who discloses such information.”
Id. at 7.
January 22, 2016, Defendant removed this action from Superior
Court to United States District Court for the Southern
District of California pursuant to 28 U.S.C. §§
1332 and 1441(a), (b). (ECF No. 1 at 2). On January 22, 2016,
Defendant filed an Answer. (ECF No. 2).
October 14, 2016, Defendant filed a motion for summary
judgment, or in the alternative, partial summary judgment.
(ECF No. 39). On November 7, 2016, Plaintiff filed a response
in opposition. (ECF No. 44). On November 14, 2016, Defendant
filed a reply. (ECF No. 46). The Court heard oral argument on
the motion for summary judgment on February 24, 2017.
declaration filed by Defendant, Thomas Cardosa, a Hologic
Human Resources Business Partner for the Finance Department
in San Diego, states,
Based on a review of [Plaintiff's] file, I know Plaintiff
worked for Gen-Probe Incorporated from October 2004 until
August 2012 when the company was acquired by Hologic, at
which point Plaintiff began working for Hologic. . . .
Plaintiff originally was hired as a Fixed Asset Accountant
(later referred to as an Accountant II). On June 25, 2007,
Plaintiff was transferred to the Cost Accounting Department
as a Cost Accountant II. Plaintiff held this position until
her termination on July 24, 2015. . . . As a HR Business
Partner I was also involved with the final decision to
terminate Plaintiff's employment and assisted her
supervisors Chun Ren and John O'Shea through the process.
The decision to terminate Plaintiff's employment was made
and finalized within a day of her missing a performance
meeting on July 20, 2015. As such, the decision to terminate
Plaintiff's employment was finalized no later than July
21, 2015. However, as Plaintiff had already demonstrated that
she would not attend a meeting with her supervisors and I, we
used a previously scheduled appointment that Plaintiff had
with another HR Business Partner, Stephanie Heller, on July
23, 2015 to communicate this decision with her. . . .
Plaintiff was initially to be terminated on July 23, 2015.
However, as she had a vacation day scheduled for July 24,
2015, the company moved back her official termination to July
24, 2015. Her last day worked, however, was July 23, 2015.
(Cardosa Decl., ECF No. 39-8).
deposition of John O' Shea, Senior Director of Finance at
Hologic, O'Shea states that he was hired at Hologic in
January of 2015 and was the direct supervisor of Joe
Abramson, a senior finance manager, before Abramson left
Hologic. O' Shea states that Chun Ren was hired to fill
Abramson's position and, following some management
changes, became Plaintiff's supervisor. (O'Shea Dep.,
ECF No. 39-4 at 13-18). O'Shea states that
Plaintiff's primary role was cost accounting and that her
cost accounting was not reliable. Id. at 19.
O'Shea states, “I first became aware that there
were issues with Karmen's work beginning in April of 2015
for the March close.” Id.
declaration by Chun Ren, Senior Manager of Cost Accounting at
Hologic, Ren states,
From the time of my hire to July 23, 2015, I was Karmen
Smiley's direct supervisor. As her direct supervisor, I
was responsible for reviewing Ms. Smiley's work. As soon
as I began working with Ms. Smiley, I began to notice errors
in her work. When I attempted to address these errors with
Ms. Smiley, I received push back, and while some of the
errors would be corrected, I continued to see errors and have
concerns with her performance.
 Therefore, I began documenting Ms. Smiley's
performance issues with the purpose of having a performance
discussion with Ms. Smiley. The goal of this performance
meeting was never to terminate Ms. Smiley, but rather to
engage in dialogue regarding my concerns and issue Ms. Smiley
a Performance Improvement Plan. I began documenting my
concerns with Ms. Smiley in late May or early June.
 By mid-July 2015, my supervisor John O'Shea, the Human
Resources Business Partner, Thomas Cardosa and I felt we had
sufficient specific examples of Plaintiff's performance
problems to allow us to have a productive performance
conversation with Plaintiff. I emailed my list of performance
concerns to Mr. Cardosa, who incorporated the points into an
agenda for the meeting. . . .
 I reached out to Plaintiff by Lync conversation on or
about July 16, 2015 to schedule the meeting. . . . Plaintiff
failed to respond to my inquiry.
 Therefore on July 19, 2015, I sent an invitation to Ms.
Smiley, Mr. O'Shea and Mr. Cardosa for a meeting to be
held on July 20, 2015, to discuss Plaintiff's performance
issues and unprofessional attitude and to issue Plaintiff a
Performance Improvement Plan.
 Ms. Smiley failed to attend this meeting, so Mr.
O'Shea, Mr. Cardosa, and I were never able to address any
of the concerns we had with Plaintiff's performance.
Because of Ms. Smiley's demonstrated performance
deficiencies, her unprofessional behavior, her outright
refusal to work towards a constructive solution to her
ongoing problems, and the final straw of her refusal to
attend a performance meeting, Mr. O'Shea, Mr. Cardosa and
I made the decision to terminate Ms. Smiley's employment.
(Ren Decl., ECF No. 39-6 at 1-4).
to the Ren declaration is a copy of the proposed agenda for
the performance meeting Ren intended to have with Smiley.
(Exhibit A, ECF No. 39-7 at 3-5). The proposed agenda
documents a number of “work errors” and instances
of “attitude/behavior.” Id. Attached to
the Ren declaration is a copy of a message Ren sent to
Plaintiff. (Exhibit B, ECF No. 39-7 at 7). In the message
dated July 16, 2015, Ren states, “Are you going to be
in the office on Monday? I am trying to schedule a meeting as
we talked about.” Id. Attached to the Ren
declaration is a invitation to a meeting dated July 19, 2015,
to Ren, Smiley, Cardosa, and O'Shea scheduled for July
20, 2015 at 10:00 a.m. (Exhibit C, ECF No. 39-7 at 9).
to the deposition of Plaintiff is a copy of Plaintiff's
response to the meeting invitation in which Plaintiff states,
“Thanks, but please don't” and declines the
July 20, 2015 meeting invitation. (Exhibit C, ECF No. 39-4 at
44-45). In a copy of an email chain dated July 20, 2015, Ren
states that Plaintiff needs to attend the meeting. (Exhibit
C, ECF No. 39-4 at 67-68).
deposition of Thomas Cardosa, Cardosa states that he, Ren,
and O'Shea were present for the July 20, 2015 meeting.
Cardosa states that Plaintiff was not present. (Cardosa Dep.,
ECF No. 39-4 at 115-16). Cardosa states,
The recommendation to terminate Karmen's employment was
based that [sic] she refused to attend a performance
conversation. The previous topics that we discussed today
were going to be included in that conversation. In no way,
shape, or form was that meeting to be a termination meeting.
It was to provide Karmen with specific documented examples
where she can - she can understand what's expected of her
so that she could be successful as an Accountant II at
Id. at 113. Cardosa states that the decision to
terminate Plaintiff was made following the scheduled July 20,
2015 meeting that Plaintiff failed to attend. Id. at
declaration by John O'Shea, Senior Director of Finance
for the Diagnostic Division at Hologic, O'Shea states,
 Hologic is a leading developer, manufacturer, and supplier
of diagnostic products, medical imaging systems and surgical
products. Hologic's core business segments include
Diagnostics, Breast Health, GYN Surgical, and Skeletal
Health. Hologic is a publicly traded company that is required
to file quarterly financial statements with the Securities
and Exchange Commission.
 As a Senior Director of Finance for the Diagnostics
Division of Hologic, I am a responsible [sic] for managing
the finance team in Hologic's San Diego Location. Part of
the duties of the San Diego finance team is to complete what
is referred to as the Grifols Reclass, which is further
explained below. As a result of my experience working with
the Grifols Reclass, and supervising the process, I have
personal knowledge of the facts below.
 Hologic's Diagnostic segment includes the Molecular
Diagnostics (“MDX”) and Blood Screening
divisions, among others.
 Hologic sells several Diagnostic products across the
globe. For internal record keeping, these sales are tracked
by division (i.e. MDX or Blood Screening) and by geographic
code (“Geo Code”). Different Geo Codes are
assigned to different countries. The division allocation is
determined by the customer, while the location is determined
by the country where the product was sold. As such, the same
product, depending on to whom it is sold, can be allocated to
 When a product sells and an invoice is created,
Hologic's accounting system automatically generates an
entry which “maps” the “revenue” and
the “cost of goods sold” for each product listed
on the invoice to both a division and to a Geo Code. However
within Hologic's accounting system, each product can only
be “mapped” to a single Diagnostic division. In
the case of these products, when operating correctly,
regardless of the customer, a domestic sale of a Diagnostic
product should automatically create a Revenue and Cost of
Goods Sold entry in the MDX division under a domestic Geo
Code. Similarly, an international sale of a Diagnostic
product should automatically create a Revenue and Cost of
Goods sold entry in the MDX division under the appropriate
international Geo Code.
 Relevant to the current case, Hologic sells several
dual-division products through its partnership with Grifols,
a Spanish multinational pharmaceutical and chemical company.
Diagnostic products sold to Grifols are accounted for under
the Blood Screening division. Consequently, and as explained
above, because Hologic initially records all Grifols product
sales to MDX (either Domestic or International, as
appropriate), a manual reclassification must be performed
during the month-end close to transfer the Revenues and Costs
of Goods Sold attributable to Grifols out of the MDX division
and into Blood Screening. Hologic refers to this standard
monthly reclassification as the “Grifols
Reclass.” Prior to her termination, Ms. Smiley
regularly and repeatedly processed the Grifols Reclass entry
during month-end close.
 In June 2015, I received a request to investigate a $1.4
million credit balance in MDX's International
Cost of Goods Sold accounts for various international
locations related to third-quarter 2015 Grifols sales.
 Over roughly a one month period, the Senior Manager of
Cost Accounting and I, with assistance from Karmen Smiley,
investigated the International $1.4 million Cost of Goods
Sold credit to determine the source. Ms. Ren and I ultimately
determined that during the third-quarter of 2015,
Hologic's automated accounting system incorrectly
recorded Cost of Goods Sold related to certain international
Grifols product sales to the domestic Geo Code instead of the
corresponding international Geo Code.
 This error had two primary effects, the first of which is
obvious - it overstated the amount of Costs of Goods Sold
attributable to the domestic Geo Code. Second, and less
obvious, since Ms. Smiley was unaware of the automated system
error, she had continued to do the standard monthly Grifols
Reclass. This meant Plaintiff transferred the Costs of Goods
Sold from MDX International even ...