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Zaman v. Kelly Services, Inc.

United States District Court, N.D. California

May 30, 2017

ADEEL ZAMAN, Plaintiff,
v.
KELLY SERVICES, INC., Defendant.

          ORDER ON MOTIONS FOR ATTORNEY FEES AND COSTS RE: DKT. NOS. 73, 74, 75, 76

          HOWARD R. LLOYD United States Magistrate Judge

         In September 2016, the court granted summary judgment in favor of Defendant Kelly Services, Inc. (“Kelly”) on five of six claims brought by plaintiff Adeel Zaman (“Zaman”), including employment discrimination claims under the Fair Employment and Housing Act (“FEHA”). Dkt. No. 42. Upon the parties' stipulation, the court dismissed the remaining claim (for injunctive relief pursuant to California Labor Code Section 1198.5) in March 2017. Dkt. No. 72. Kelly now moves for $75, 038.50 in fees and $5, 790.36 in costs related to Zaman's FEHA claims. Dkt. Nos. 73, 74. Zaman moves for $55, 950.00 in fees and $2, 399.85 in costs related to his Labor Code Claims, Dkt. Nos. 75, 76, and he further requests $1, 425.50 for opposing Kelly's motion, Dkt. No. 80. For the reasons described below, the court grants each motion in part.

         BACKGROUND

         Zaman, a veteran of the U.S. Marine Corps and a Pakistani- and Muslim-American, was employed by Kelly, a temporary employment agency. Kelly terminated Zaman's employment in January 2015 after he plead no contest to a misdemeanor count of simple battery. The letters Kelly sent Zaman explaining this action (dated January 22 and 29, 2015, respectively) did not state that he was terminated, but rather said, “Kelly is considering denying you an offer of employment” based on Zaman's “pre-background screen, ” and later that “an offer of employment will not be made to you at this time.” Dkt. No. 81, Connaughton Decl., Exs. 7, 8.

         Zaman brought suit against Kelly several months later. Dkt. No. 1, Ex. A. Zaman's first three claims alleged discriminatory termination on the basis of his religion, ethnicity, and perceived disability in violation of FEHA. His fourth claim alleged wrongful termination. And his fifth and sixth claims were for a statutory penalty and injunctive relief, respectively, under California Labor Code Section 1198.5. Id.

         Zaman's Labor Code claims were based on Kelly's failure to provide him with his personnel file after Zaman submitted a written request for those documents in March 2015. Kelly concedes that it did not provide a copy of the requested records within the 30-day time period specified in Section 1198.5 or before Zaman filed suit. Dkt. No. 71, ¶ 2. Kelly asserts that it provided the personnel file to Zaman on July 17, 2015. Dkt. No. 71, ¶ 4; Dkt. No. 81, Connaughton Decl., Ex. 2. Nevertheless, Zaman asked for the file in his first set of Requests for Production on July 20, 2015. Dkt. No. 81, Connaughton Decl., Ex. 3. Kelly states that it produced the file again on August 24, 2015. Id., Ex. 4.

         After its initial document production, Kelly produced copies of the January 22 and January 29 adverse action letters described above. The letters, however, were dated June 24, 2015, and August 19, 2015 (i.e., after the complaint was filed). See Dkt. No. 81, Connaughton Decl., Exs. 12, 13. When questioned about this oddity, id., Kelly responded that it was unable to locate the original versions of these letters at the time of its initial document production, and that it produced “identical form version[s]” of the letters. Id., Ex. 13. In any event, Zaman sent copies of the original letters to Kelly as part of his own production on August 20, 2015. Id., Exs. 6, 7, 8.

         Late in discovery, on June 24, 2016, Kelly took Zaman's deposition. Id., Ex. 1. During his deposition, Zaman conceded that he eventually received his personnel file, though Zaman's counsel objected to the question and Zaman clarified a few moments later that he “still [did not] have all the answers that [he was] looking for.” Dkt. No. 30, La Val Decl., Zaman Dep., 167:9-168:4. Also during his deposition, Zaman admitted that he had no direct evidence of any Kelly employee's bias against Muslims, people of Pakistani descent, or people with disabilities, and, further, that he had “no reason to believe” any Kelly employee was so biased. Id., at 74:18-76:23.

         Fact discovery was set to close on July 14, 2016. Dkt. No. 18. The parties, however, in a July 25, 2016, stipulation, stated that “a deposition of Kelly and possibly one of its employees” had yet to occur. Dkt. No. 28. Apparently, Zaman never took these depositions. Dkt. No. 81, Connaughton Decl., ¶ 15. Additionally, Zaman never filed a motion to compel disclosure of any missing pieces of his personnel file. Dkt. No. 81, Connaughton Decl., ¶ 15.

         Kelly filed its motion for summary judgment on August 8, 2016. On September 28, 2016, the court granted summary judgment on the three FEHA claims and the wrongful termination claim. Dkt. No. 42. The court concluded that Zaman failed to establish a prima facie case (by failing to produce evidence establishing an inference of discrimination), that Kelly established a legitimate, nondiscriminatory reason for the termination (Zaman's no contest plea for battery), and that Zaman failed to show that this reason was pretextual. Id. The court granted summary judgment on Zaman's fifth claim for a statutory penalty under Labor Code Section 1198.5 after Kelly tendered the $750 penalty to Zaman. Id. The court denied Kelly's motion with respect to Zaman's sixth claim, for injunctive relief under Section 1198.5, on the basis that a material fact- whether Zaman had received his entire personnel file-remained in dispute. Id.

         The parties continued litigating the claim for injunctive relief through the pre-trial conference in February 2017. Dkt. No. 70. Finally, in March 2017, rather than proceeding to trial, the parties stipulated to dismissing the remaining claim without prejudice and to each side moving for attorney fees and costs. Dkt. Nos. 71, 72. Zaman maintains that his “complete accurate file has yet to be produced.” Dkt. No. 71, ¶ 4.

         DEFENDANT'S MOTION FOR ATTORNEY FEES

         Kelly's motion seeks attorney fees and costs related to Zaman's FEHA claims. Dkt. No. 73. Kelly asserts that it prevailed on these claims and that it is entitled to fees pursuant to California Government Code Section 12965. Id. As such, Kelly requests $75, 038.50 in fees and $5, 790.36 in costs incurred from June 24, 2016, the date of Zaman's deposition-at which time, Kelly argues, it should have become clear to him that his FEHA claims were frivolous, groundless, or unreasonable, since he admitted the absence of evidence supporting these claims- to September 28, 2016, the date of the court's summary judgment order.[1] Id.

         Zaman opposes Kelly's motion, arguing that his claims were not frivolous. In particular, he asserts that Kelly's confusing and inaccurate letters containing the so-called reasons for his termination, compounded by the odd sequence of events with respect to the production of these letters, yielded an inference that his termination was due to discrimination-or, at least, that Kelly was not being entirely truthful. Dkt. No. 80. Zaman further argues that he only learned about Kelly's nondiscriminatory reason for his firing upon receiving the declarations attached to Kelly's summary judgment motion. Id. Finally, Zaman requests that the court sanction Kelly for manufacturing evidence during discovery (i.e., producing letters with altered dates) by awarding him the $1, 425.50 he incurred in opposing Kelly's fee motion. Id.

         LEGAL STANDARD

         Federal courts sitting in diversity apply state law in determining both a party's rights to fees and the method of calculating them. Mangold v. Cal. Pub. Util. Comm'n, 67 F.3d 1470, 1478 (9th Cir. 1995). The standard for a defendant's recovery of attorney fees in employment discrimination matters is the same under California law (Cal. Gov. Code § 12965) as it is under the relevant federal statutes. Bond v. Pulsar Video Prods., 50 Cal.App.4th 918, 921 (1996).

         A district court has discretion to award attorney fees to a prevailing defendant in a FEHA action “upon a finding that the plaintiff's action was frivolous, unreasonable, or without foundation [i.e., groundless].” Christiansburg Garment Co. v. Equal Emp't Opportunity Comm'n, 434 U.S. 412, 421-22 (1978). Such an award need not cover the entire litigation, but “may be limited to the period after events demonstrate[d]” the claims' groundlessness. Moss v. Associated Press, 956 F.Supp. 891, 896 (C.D. Cal. 1996); Williams v. Chino Valley Indep. Fire Dist., 61 Cal.4th 97, 99-100 (2015) (applying the same standard under Government Code Section 12965(b)). In setting out this standard in Christiansburg, the Supreme Court, mindful of the danger of discouraging meritorious suits, cautioned district courts about hindsight bias:

It is important that a district court resist the understandable temptation to engage in post hoc reasoning by concluding that, because a plaintiff did not ultimately prevail, his action must have been unreasonable or without foundation. This kind of hindsight bias could discourage all but the most airtight claims, for seldom can a prospective plaintiff be sure of ultimate success.

434 U.S. at 421-22. The Court reminded judges that litigation is unpredictable, and that “decisive facts may not emerge until ...


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