Mendoza v. Western Medical Center Santa Ana , 166 Cal. Rptr. 3d 720 ( 2014 )

Filed 1/14/14
CERTIFIED FOR PUBLICATION
IN THE COURT OF APPEAL OF THE STATE OF CALIFORNIA
FOURTH APPELLATE DISTRICT
DIVISION THREE
ROMEO MENDOZA,
Plaintiff and Respondent, G047394
v. (Super. Ct. No. 30-2011-00459349)
WESTERN MEDICAL CENTER SANTA OPINION
ANA et al.,
Defendants and Appellants.
Appeal from a judgment of the Superior Court of Orange County, Ronald
L. Bauer, Judge. Reversed.
Vaughn & Vaughn, Donald A. Vaughn and Robert J. Bello for Defendants
and Appellants.
C. Athena Roussos; The Lampel Firm and Eric P. Lampel for Plaintiff and
Respondent.
* * *
A jury voted nine to three to award $238,328 to plaintiff Romeo Mendoza,
who claimed he was fired in retaliation for reporting allegations of sexual harassment.
The court instructed the jury with the 2012 version of CACI No. 2430 and a special
verdict form consistent therewith. Case law issued subsequent to the judgment leads us
to conclude the court committed prejudicial error in doing so. (See Harris v. City of
Santa Monica (2013) 56 Cal. 4th 203 (Harris); Alamo v. Practice Management
Information Corp. (2013) 219 Cal. App. 4th 466 (Alamo).) We reject, however,
defendants’ contention that they are entitled to a defense judgment as a matter of law.
Accordingly, we reverse the judgment for a new trial.
FACTS
First hired as a staff nurse in 1990, Mendoza was employed at a hospital for
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more than 20 years. By 2010, Mendoza was an intermediate-level supervisor on the
overnight shift and even filled in periodically as the person in charge at the hospital
(“House Supervisor”). By all accounts, and as reflected by his long term of service and
march up the ranks of authority, Mendoza was an excellent nurse. As defense counsel
stated during a pretrial hearing, “we will stipulate he was a fine employee, he was
performing his job competently, he received awards, he received commendations. . . .
This is not a case where Mr. Mendoza was terminated because he performed his job in a
substandard manner[,] because he made medical errors or anything of that nature.”
In late October 2010, Mendoza reported to a House Supervisor that he was
being sexually harassed by Del Erdmann, a per diem House Supervisor hired by
1
Since May 2005 and at the time of Mendoza’s firing, the hospital was
operated by defendants Western Medical Center Santa Ana and its parent company,
Integrated Healthcare Holdings, Inc.
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defendants in April 2010. Whenever Mendoza and Erdmann worked the same shift,
Erdmann was Mendoza’s supervisor. After the complaint was passed up the chain of
command, the matter was referred to the human resources department and an
investigation ensued.
Mendoza and Erdmann are both gay men. The gist of Mendoza’s
accusation was that Erdmann, on numerous occasions, harassed Mendoza on the job with
inappropriate comments (e.g., “I know you want me in your ass”), physical contact (e.g.,
Erdmann blowing air in Mendoza’s ear), and lewd displays (e.g., Erdmann showing his
genitals to Mendoza). According to Mendoza’s testimony, this behavior began in August
2010 with words and culminated in October with Erdmann exposing himself. Mendoza
denied he consented to Erdmann’s behavior. Mendoza denied he had ever willingly
engaged in flirtatious or lewd conduct with Erdmann. Mendoza told Erdmann to stop.
Mendoza admitted that he violated defendants’ policy by not immediately reporting
Erdmann’s behavior. Mendoza ultimately complained about Erdmann’s conduct after a
second incident in which Erdmann exposed himself and said, “I know you want this in
your ass.”
Erdmann, on the other hand, testified (and stated during defendants’
investigation) that Mendoza consented to Erdmann’s conduct and participated in other
mutual interactions (e.g., Mendoza would bend over provocatively in front of Erdmann,
Mendoza requested that Erdmann display his genitals, Mendoza assisted Erdmann in
exposing his genitals). Indeed, Erdmann claimed he was a reluctant participant in
conduct initiated by Mendoza. At both the investigation stage and at trial, Mendoza and
Erdmann were the only two individuals identified with personal knowledge of what
occurred between them at the hospital.
Mendoza’s expert witness took issue with the quality of the investigation
process. Defendants did not prepare a formal investigation plan. Defendants did not take
written statements from Mendoza or Erdmann. Defendants did not immediately
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interview Erdmann, and suspended the investigation while Mendoza missed work for
several weeks following a bicycle accident. When Mendoza returned to work, Mendoza
and Erdmann were interviewed simultaneously rather than separately. Defendants did
not interview anyone other than Mendoza and Erdmann (such as coworkers who might
provide insights as to the credibility of the two men). The individual charged with
completing the investigation was not a trained human resources employee, but was
instead the supervisor of Erdmann and Mendoza. On cross-examination, Mendoza’s
expert conceded he was unaware of any specific information that would have been
uncovered had defendants conducted a proper (in the expert’s view) investigation. But a
subsequent witness (an employee who conducted Erdmann’s orientation) testified that he
noticed Erdmann making sexual innuendos during the orientation.
Upon the completion of the investigation, defendants fired both Mendoza
and Erdmann on December 14, 2010. The written notice of termination provided by
defendants to Mendoza cited “unprofessional conduct” as the reason for Mendoza’s
dismissal. According to their testimony, the individuals participating in the decision
concluded that both Mendoza and Erdmann were complicit in inappropriate and
unprofessional behavior. There is a progressive discipline system in place at the hospital,
subject to which an employee could be verbally warned, warned in writing, suspended, or
terminated. Defendants claim to have considered but rejected a lesser punishment for
Mendoza.
Mendoza sued defendants for wrongful termination in violation of public
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policy. Answering a special verdict form, the jury found defendants liable for wrongful
2
Actually, Mendoza’s complaint featured eight causes of action, but none of
his other causes of action are relevant to this appeal. Two causes of action were
dismissed as a result of a motion for summary adjudication (breach of contract and
breach of implied covenant of good faith and fair dealing); three causes of action were
voluntarily dismissed with prejudice during trial (age discrimination in violation of the
California Fair Employment and Housing Act (FEHA), sexual orientation discrimination
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termination in violation of public policy. The jury determined that Mendoza suffered
$93,328 in past economic loss and $145,000 in past emotional distress. The court
subsequently entered judgment in favor of Mendoza and against defendants in the total
amount of $238,328, plus interest from the date of judgment and costs. Defendants filed
a timely notice of appeal.
DISCUSSION
“[W]hen an employer’s discharge of an employee violates fundamental
principles of public policy, the discharged employee may maintain a tort action and
recover damages traditionally available in such actions.” (Tameny v. Atlantic Richfield
Co. (1980) 27 Cal. 3d 167, 170.) “To support a common law wrongful discharge claim,
the public policy ‘must be: (1) delineated in either constitutional or statutory provisions;
(2) “public” in the sense that it “inures to the benefit of the public” rather than serving
merely the interests of the individual; (3) well established at the time of the discharge;
and (4) substantial and fundamental.’” (Haney v. Aramark Uniform Services, Inc. (2004)
121 Cal. App. 4th 623, 642.)
With one exception, the elements of Mendoza’s claim are undisputed by the
parties on appeal. Mendoza was discharged by his ex-employers, defendants, after
Mendoza accused a supervisor, Erdmann, of sexual harassment. The public policy
invoked by Mendoza supports his claim in the abstract (i.e., a common law wrongful
termination action may be based on the firing of an employee because the employee
in violation of FEHA, and unfair business practices pursuant to Bus. & Prof. Code,
§ 17200); one cause of action was dismissed pursuant to a nonsuit motion (negligent
infliction of emotional distress); and the jury rejected one cause of action (intentional
infliction of emotional distress).
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reports sexual harassment to the employer). Mendoza suffered harm as a result of his
termination (and the amount of damages awarded by the jury is not challenged on
appeal).
The crux of the case is causation, a slippery concept in tort law generally
and employment law in particular. (See, e.g., Clarke, A Better Route Through the
Swamp: Causal Coherence in Disparate Treatment Doctrine (2013) 65 Rutgers L.Rev.
723; Katz, The Fundamental Incoherence of Title VII: Making Sense of Causation in
Disparate Treatment Law (2006) 94 Geo. L.J. 489; Univ. of Tex. Southwestern Med.
Center v. Nassar (June 24, 2013, No. 12-484) 2013 U.S. Lexis 4704 [five to four decision
examining causation element in federal retaliation claims].)
Mendoza claims his report of sexual harassment caused defendants to fire
him. In other words, defendants retaliated against Mendoza for accusing his superior
(Erdmann) of sexual harassment. On the other hand, defendants cite their belief that
Mendoza willingly participated in sexual misconduct on the job as their motivation for
firing Mendoza. From defendants’ perspective, Mendoza’s report only “caused” his
firing in the sense that it alerted defendants to Mendoza’s misconduct. Defendants
concede it is against public policy to fire employees because they report actual sexual
harassment. But defendants posit it is not against public policy for employers to fire
employees after the employer determines in good faith that the employee actually
3
Government Code section 12940, subdivision (h), specifically proscribes
the “discharge” of “any person . . . because the person has filed a complaint . . . under this
part.” A complaint “under this part” would appear to include sexual harassment.
(Id., subd. (j)(1); Joaquin v. City of Los Angeles (2012) 202 Cal. App. 4th 1207, 1217
(Joaquin).) Of course, “FEHA does not supplant other state laws, including claims under
the common law, relating to employment discrimination [and] sex discrimination in
employment may support a claim of tortious discharge in contravention of public policy.”
(Rojo v. Kliger (1990) 52 Cal. 3d 65, 70-71, 73-82; see also Cal. Const., art. I, § 8 [“A
person may not be disqualified from entering or pursuing a business, profession,
vocation, or employment because of sex, race, creed, color, or national or ethnic
origin”].)
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participated in sexual misconduct on the job. (See Joaquin, supra, 202 Cal.App.4th at p.
1226 [“an employer may discipline or terminate an employee for making false charges,
even where the subject matter of those charges is an allegation of sexual harassment”].)
On appeal, defendants attack the judgment by pointing to alleged
instructional error with regard to the element of causation. Defendants also assert there is
insufficient evidence in the record to support the jury’s causation findings.
Prejudicial Instructional Error Occurred Requiring Reversal
Initially, defendants obtained a very favorable jury instruction and special
verdict form on the issue of causation. The jury was instructed as follows: “3. That
Romeo Mendoza’s report of sexual harassment by Del Erdmann was the motivating
reason for Romeo Mendoza’s discharge.” (Italics added.) This instruction included a
slight (but important) modification of the 2012 version of CACI No. 2430 (“the
motivating reason” rather than “a motivating reason”). The special verdict form
submitted to the jury was even starker: “Was Romeo Mendoza’s report of sexual
harassment by Del Erdman the reason for [defendants’] decision to discharge Romeo
Mendoza.” (Italics added.) This differed from the special verdict language used in the
2012 version of CACI No. VF-2406 (“a motivating reason”). A jury tasked with
deciding whether the report of sexual harassment was “the motivating reason” or “the
reason” might logically conclude that this element could only be satisfied if there were
only one reason motivating the decision to fire Mendoza.
In the midst of its deliberations, the jury submitted the following question
about the causation interrogatory on the special verdict form: “Does this question . . .
imply that the report was the only reason for the termination? Does this mean they
retaliated?” Over defendants’ objection, the court submitted a written response to the
jury’s inquiry: “Pursuant to the Jury Instruction . . . , the plaintiff must prove that his
report of Sexual Harassment was a motivating reason for his discharge. (That instruction
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incorrectly refers to ‘the motivating reason’. It should say ‘a motivating reason’). [¶]
Please consider this answer in any vote or deliberations.” The jury marked out the word
“the” and inserted the word “a” on both the relevant jury instruction and the special
verdict form.
Defense counsel opposed the court’s response to the jury on the grounds
that the initial instruction and special verdict form were correct. Defense counsel added
that “the clarification would, at a minimum, have to say, ‘a primary reason. A substantial
motivating reason.’” The court responded, “[i]f CACI is right, then we are right.”
The 2012 versions of CACI Nos. 2430 and VF-2406 were not right, at least
in the view of the Judicial Council in 2013. Effective June 2013, CACI No. 2430
provides the following with regard to causation: “That [insert alleged violation of public
policy . . . ] was a substantial motivating reason for [name of plaintiff]’s discharge.” The
corresponding special verdict form also inserted updated language (“a substantial
motivating reason”). (CACI No. VF-2406.)
These changes were inspired by Harris, supra, 56 Cal. 4th 203, a February
2013 case in which the plaintiff alleged her employer fired her because she was pregnant.
Our Supreme Court held that CACI No. 2500 (the FEHA disparate
treatment/discrimination instruction) did not accurately state the law in calling for the
jury “to determine whether discrimination was ‘a motivating factor/reason’ for Harris’s
termination. . . . [T]he jury should instead determine whether discrimination was ‘a
substantial motivating factor/reason.’” (Harris, supra, 56 Cal.4th at p. 232.) “Requiring
the plaintiff to show that discrimination was a substantial motivating factor, rather than
simply a motivating factor, more effectively ensures that liability will not be imposed
based on evidence of mere thoughts or passing statements unrelated to the disputed
employment decision. At the same time, . . . proof that discrimination was a substantial
factor in an employment decision triggers the deterrent purpose of the FEHA and thus
exposes the employer to liability, even if other factors would have led the employer to
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make the same decision at the time.” (Ibid.) Harris makes clear (at least with regard to
CACI No. 2500) that the initial instruction in this case (“the motivating reason”) and the
court’s amended instruction (“a motivating reason”) were incorrect.
Even more recently, an appellate court held “that the trial court
prejudicially erred in instructing the jury with the former versions of CACI Nos. 2430,
2500, 2505, and 2507 because the proper standard of causation in a FEHA discrimination
or retaliation claim is not ‘a motivating reason,’ as used in the [former] CACI
instructions, but rather ‘a substantial motivating’ reason, as set forth in Harris.” (Alamo,
supra, 219 Cal.App.4th at pp. 469-470.) Following her termination, the Alamo plaintiff
(who had recently taken a “pregnancy-related leave of absence”) sued under a variety of
theories, including wrongful termination in violation of public policy. (Id. at p. 470.)
The Alamo court rejected the contention “that a jury in an employment discrimination
case would not draw any meaningful distinction between ‘a motivating reason’ and ‘a
substantial motivating reason’ in deciding whether there was unlawful discrimination
[because] the Supreme Court reached a contrary conclusion in Harris.” (Id. at p. 479.)
The directions for use included with the current version of CACI No. 2430
state that “[w]hether the FEHA standard [as explicated in Harris] applies to cases
alleging a violation of public policy has not been addressed by the courts.” But the
Alamo case, issued in August 2013, has answered this question in the affirmative. We
agree with Alamo. It would be nonsensical to provide a different standard of causation in
FEHA cases and common law tort cases based on public policies encompassed by FEHA.
Mendoza tries to distinguish the instant case from Alamo by noting that he abandoned his
statutory FEHA claims before the case was submitted to the jury. This is a distinction
without a difference for purposes of crafting appropriate jury instructions.
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It is therefore clear that the court erred in its instruction of the jury. The
court should have instructed the jury to determine whether Mendoza’s report of sexual
harassment was a substantial motivating reason for Mendoza’s discharge. Following
Harris and Alamo, we conclude this error was prejudicial. The jury’s verdict in favor of
Mendoza was extremely close (a nine to three vote). No other instructions provided to
the jury could have cured the erroneous instruction with regard to the contested element.
Viewing the evidence “in the light most favorable” to defendants (Huffman v. Interstate
Brands Corp. (2004) 121 Cal. App. 4th 679, 692), there is a reasonable probability that the
instructional error prejudicially affected the verdict.
Defendants also contend the jury instructions and special verdict form were
in error because it “may have made a plaintiff’s verdict inevitable” by allowing the jury
to infer retaliatory intent based on the causal finding that Mendoza’s “report of sexual
harassment was a motivating reason for the . . . decision to terminate him.” (Joaquin,
supra, 202 Cal.App.4th at p. 1231; see com. to CACI No. 2505 [noting criticism of
instruction based on perceived lack of element requiring retaliatory intent].) In other
words, it is reasonable to infer in this case that, regardless of whether the jury believed
the defendants’ stated reasons for Mendoza’s firing, his firing was caused in some sense
by the report of sexual harassment. Had Mendoza not said anything, there is nothing in
the record to suggest defendants would have found out about the incidents involving
Mendoza and Erdmann. “[I]n cases such as Joaquin that involve allegations of a
prohibited motivating reason (based on a report of sexual harassment) and a permitted
motivating reason (based on a good faith belief that the report was falsified), the
instruction may need to be modified to make it clear that plaintiff must prove that
defendant acted based on the prohibited motivating reason and not the permitted
motivating reason.” (Com. to CACI No. 2505.)
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We see no reason to weigh in on the issue. We have already determined
that the court committed prejudicial error requiring reversal of the judgment as set forth
above. On remand, defendants will have an opportunity to request jury instructions and a
special verdict form addressing the potential misunderstanding described in Joaquin
before the new trial goes forward.
Substantial Evidence Supports the Judgment
Defendants also contend there is insufficient evidence in the record to
support the jury’s conclusion that defendants fired Mendoza in violation of public policy.
Defendants posit they would be entitled to entry of judgment in their favor (rather than a
new trial) if the jury’s retaliation finding is not supported by substantial evidence. Thus,
we entertain this second issue even though we have already concluded that defendants are
entitled to a reversal because of instructional error.
“On review, we apply the substantial evidence test to the jury’s verdict, . . .
reading the record in the light most advantageous to the plaintiff. [Citations.] Actions
for retaliation are ‘inherently fact-driven’; it is the jury, not the court, that is charged with
determining the facts.” (McCoy v. Pacific Maritime Assn. (2013) 216 Cal. App. 4th 283,
299.) We must “accept as true all the evidence and reasonable inferences therefrom that
tend to establish the correctness of the [jury’s] findings and decision, and resolve every
conflict in favor of the judgment.” (Baxter Healthcare Corp. v. Denton (2004) 120
Cal. App. 4th 333, 369.)
In cases like the instant one, “the ultimate question for the fact finder is
whether the employer’s stated reason for discipline . . . was pretextual or whether there is
other evidence that, ‘as a whole supports a reasoned inference that the challenged action
was the product of discriminatory or retaliatory animus.’” (Joaquin, supra, 202
Cal.App.4th at p. 1226.) Defendants claim they fired Mendoza solely because they
believed Mendoza willingly engaged in flirtatious and lewd behavior with a supervisor
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over the course of several months, and not as a result of any retaliatory animus.
Defendants assert there is no evidence to establish an inference that they acted in bad
faith when they decided to fire Mendoza. (Cf. Cotran v. Rollins Hudig Hall Internat.,
Inc. (1998) 17 Cal. 4th 93, 95, 107-109 [proper inquiry for jury (at least in a case in which
the employee sues for breach of an implied contract not to be dismissed except for good
cause) is whether employer acted in good faith after appropriate investigation, not
whether employee actually committed the misconduct cited as the reason for dismissal].)
As an initial matter, defendants cite their simultaneous termination of
Erdmann as conclusive proof of defendants’ good faith. We disagree with the
proposition that the simultaneous firing of Erdmann necessarily entitles defendants to
judgment as a matter of law. Obviously, the facts here are more complicated for
Mendoza than a stereotypical case in which a boss fires his or her employee because the
employee accuses the boss (or another favored supervisor who is retained) of sexual
harassment. (See, e.g., Page v. Superior Court (1995) 31 Cal. App. 4th 1206, 1208-1210
[supervisor accused of harassment and retaliation was vice-president and partial owner of
company].) Retaliation, if it occurred, was not motivated out of a desire to protect
Erdmann or punish Mendoza for harming Erdmann as such. But the protection of a
specific supervisor is not the only logical reason an employer would retaliate against an
employee reporting sexual harassment. (See Delashmutt v. Wis-Pak Plastics, Inc.
(N.D.Iowa 1998) 990 F. Supp. 689, 698-702 [denying summary judgment motion in
retaliation case even though employer reacted to employee’s complaint of sexual
harassment by firing alleged harasser]; George, Revenge (2008) 83 Tul. L.Rev. 439, 440
[“Even if the employer believes the complaint has merit, he may still resent the employee
for ‘making trouble’”]; Estlund, The Changing Work Place: Wrongful Discharge
Protections in an At-Will World (1996) 74 Tex. L.Rev. 1655, 1684 [“both the accused
and the accuser are largely at the mercy of the employer, who may be moved by whim or
sexism or favoritism or fear of litigation or a rational assessment of the costs and benefits
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of various responses”].) Perhaps defendants were substantially motivated by a desire to
rid themselves of an individual who had become problematic by reason of his reporting
sexual harassment, without regard to the accuracy of his accusations. (See Delashmutt v.
Wis-Pak Plastics, Inc., supra, 990 F.Supp. at p. 702, fn. 8 [“It is conceivable that an
employer could rid itself of a short-term problem by firing an alleged harasser, then
attempt to rid itself of the long-term problem of the complaining person if it perceived
that person to have the potential to be a chronic complainer”].)
There is sufficient evidence in the record for the jury to conclude that a
substantial motivating reason for Mendoza’s firing was his report of sexual harassment.
Defendants terminated an excellent, long term employee soon after he reported sexual
harassment by a recent hire, Erdmann. (Taylor v. City of Los Angeles Dept. of Water &
Power (2006) 144 Cal. App. 4th 1216, 1235, disapproved on another ground in Jones v.
Lodge at Torrey Pines Partnership (2008) 42 Cal. 4th 1158, 1173-1174 [“Close proximity
in time of an adverse action to an employee’s resistance or opposition to unlawful
conduct is often strong evidence of a retaliatory motive”]; Holmes v. General Dynamics
Corp. (1993) 17 Cal. App. 4th 1418, 1435 [affirming jury verdict, in part based on prior
outstanding job performance].) Accepting Mendoza’s testimony as true (as we must for
this purpose), Mendoza was not complicit in sexual misconduct at the hospital. Instead,
Erdmann harassed Mendoza while Erdmann was acting as Mendoza’s supervisor at the
hospital. After being confronted by defendants, Erdmann confirmed part of Mendoza’s
story (i.e., that improper activity occurred) but accused Mendoza of being the instigator
and willing participant. With nothing to go on besides their respective statements,
defendants claim they chose to believe Erdmann’s characterization of the incidents rather
than Mendoza’s complaint.
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Importantly, in combination with the foregoing facts, Mendoza’s expert
witness testified that there were numerous shortcomings in the investigation conducted
by defendants following Mendoza’s complaint. (See Nazir v. United Airlines, Inc. (2009)
178 Cal. App. 4th 243, 278-283 [inadequate investigation is evidence of pretext].) The
lack of a rigorous investigation by defendants is evidence suggesting that defendants did
not value the discovery of the truth so much as a way to clean up the mess that was
uncovered when Mendoza made his complaint. Defendants point to the expert’s
concession that additional facts would not necessarily have been discovered had the
alleged flaws in the investigation been addressed. But the question for the jury was
defendants’ subjective motivation in deciding to fire Mendoza, not whether defendants
actually had all available material before them. Moreover, a more thorough investigation
might have disclosed additional character and credibility evidence for defendants to
consider before making their decision.
In sum, substantial evidence supports the judgment. Thus, on remand, it
will be up to a jury to decide whether the expert’s characterization of the investigation is
accurate and whether to infer from that characterization that defendants had retaliatory
animus. Similarly, it will be up to a jury to determine whether defendants’ termination of
4
Mendoza was substantially motivated by improper considerations.
4
At oral argument, defense counsel asked (perhaps rhetorically) just what
employers were expected to do when faced with a scenario in which two employees
provide conflicting accounts of inappropriate conduct. Our answer is simple: employers
should conduct a thorough investigation and make a good faith decision based on the
results of the investigation. Here, the jury found this did not occur. Hopefully, this
opinion will disabuse employers of the notion that liability (or a jury trial) can be avoided
by simply firing every employee involved in the dispute.
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DISPOSITION
The judgment is reversed. In the interests of justice, the parties shall bear
their own costs incurred on appeal.
IKOLA, J.
WE CONCUR:
O’LEARY, P. J.
BEDSWORTH, J.
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