Haney v. Aramark Uniform Services, Inc.

• Decision Date: 11 August 2004
• Docket Number: No. F042980.,F042980.
• Citation: 17 Cal.Rptr.3d 336,121 Cal.App.4th 623
• Parties: Michael HANEY, Plaintiff and Appellant, v. ARAMARK UNIFORM SERVICES, INC., Defendant and Respondent.
• Court: California Court of Appeals Court of Appeals

17 Cal.Rptr.3d 336

121 Cal.App.4th 623

Michael HANEY, Plaintiff and Appellant, v. ARAMARK UNIFORM SERVICES, INC., Defendant and Respondent.

No. F042980.

Court of Appeal, Fifth District.

August 11, 2004.

Review Denied December 1, 2004.

Law Offices of Wagner & Jones, Andrew B. Jones and Nicholas J.P. Wagner, Fresno, for Plaintiff and Appellant.

Littler Mendelson, Bren K. Thomas, Fresno, and Allen A. Palacio, San Diego, for Defendant and Respondent.

OPINION

DAWSON, J.

In this appeal, a former employee alleges he was discharged because he complained about fraudulent billing practices and refused to implement those practices and, thus, his discharge violated public policy. The employer obtained summary adjudication of the wrongful discharge claim on the ground that it was preempted by federal labor statutes because (1) the employee engaged in arguably protected concerted activity and (2) the claim could not be decided independent of the just cause termination provisions contained in the applicable collective bargaining agreement.

We hold that the trial court erred in granting summary adjudication because (1) the employer's separate statement of undisputed facts did not set forth facts and reference evidence that demonstrated that the employee's individual acts were linked with actual group action and, accordingly, that the employee engaged in arguably concerted activity for purposes of the federal statute, and (2) resolution of the wrongful discharge claim is not dependent upon an interpretation of the collective bargaining agreement. In addition, we hold that the public policy of discouraging fraud constitutes a fundamental public policy of California and is sufficient to support the employee's wrongful discharge claim.

Accordingly, the judgment is reversed and the case is remanded.

FACTS AND PROCEEDINGS

Respondent Aramark Uniform Services, Inc. (Aramark) is engaged in the business of providing rental services to its customers, including rental of towels, mats, uniforms and garments, such as pants, shirts, and coveralls. Appellant Michael Haney was employed as a route sales representative by Aramark from March 1991 until January 6, 1999.

During the time Aramark employed Haney, Aramark was a party to a collective bargaining agreement with General Teamsters Union Local No. 431 (Local 431). Article 17 of that agreement between Aramark and Local 431 addresses termination of employment. Section 2(a) of that article states:

"The Employer shall not discharge or suspend any employee, other than a probationary employee without just cause, except that no warning letter suspension or other prior disciplinary action need be given to an employee before he is discharged if the cause of such discharge is dishonesty or being under the influence of intoxicating liquor or dangerous drugs on the job; failure to report for work as instructed by the Employer; reckless driving while on duty resulting in a traffic citation and conviction; gross insubordination; carrying unauthorized passengers."

Haney alleges that Aramark used a number of techniques that resulted in its customers paying for products or services that they did not receive and that these billing practices were fraudulent. Haney also alleges that he reported these matters to various members of Aramark's management. One type of fraudulent business practice Haney claims Aramark utilized related to so-called "one-way items" such as bathroom soap, paper towels, air fresheners, and toilet paper. Haney contends Aramark management personnel expressly instructed the route sales representatives, including himself, to charge its customers for one-way items they did not require or receive and bring unused items back to the plant and place them in a "clean return cart" so those items could be resold. Haney further contends that Aramark management personnel instructed the route sales representatives not to inform Aramark's customers that they would be charged for one-way items that they did not require or receive.

Conversely, Aramark contends that its practices were proper, but that Haney engaged in improper billing of the customers on his route in order to boost his commissions.

Haney was fired on January 6, 1999. A disciplinary notice provided to Haney stated he was being terminated for overcharging, not reducing inventory when requested by the customer, adding new merchandise without authorization from the customer, and not verifying inventory and lost garments with the customer. The notice also stated that Haney's action placed Aramark's account with Eagle Mountain Casino in jeopardy.

Two days later, Local 431 notified Aramark by letter that it intended to file a grievance on behalf of Haney. Aramark asserts that the grievance ended in a deadlock. An attorney for Local 431 subsequently notified Aramark by letter dated February 19, 1999, that Local 431 wished to proceed with arbitration in connection with the termination of Haney. Arbitration was not completed.

On April 30, 1999, Haney filed a complaint against Aramark, which contained three causes of action. The only cause of action relevant to this appeal is the second, which alleged that Haney was terminated because (1) he complained to management about Aramark's practice of overcharging and defrauding customers, and (2) he refused to follow Aramark's practice of defrauding customers. Haney further alleged that he "was terminated by [Aramark] without any justifiable cause or reason and in violation of public policy and in violation of [Aramark's] own policies and procedures."

Aramark filed a motion for summary adjudication asserting that the second cause of action failed as a matter of law because it was preempted by federal labor statutes and did not assert an appropriate public policy to support the claim. The superior court agreed that federal labor statutes preempted Haney's cause of action for wrongful discharge in violation of public policy and granted summary adjudication as to that claim.

Subsequently, the parties settled the first and third causes of action and a request for dismissal was filed. Haney then filed a notice of appeal from the order granting the motion for summary adjudication as to the second cause of action.

DISCUSSION

I. Standard of Review for Summary Adjudication

When reviewing the grant of a motion for summary judgment or summary adjudication,¹ we independently consider whether a triable issue of material fact exists and whether the moving party is entitled to summary judgment or adjudication as a matter of law. (Merrill v. Navegar, Inc. (2001) 26 Cal.4th 465, 476, 110 Cal.Rptr.2d 370, 28 P.3d 116.) In reassessing the merits of the motion, we "consider only the facts properly before the trial court at the time it ruled on the motion. [Citation.]" (Brantley v. Pisaro (1996) 42 Cal.App.4th 1591, 1601, 50 Cal. Rptr.2d 431.)

To obtain summary judgment or summary adjudication of an issue, a moving party must comply with Code of Civil Procedure section 437c (section 437c). This court has acknowledged that section 437c is a complicated, unforgiving statute with little flexibility and "myriad requirements." (Brantley v. Pisaro, supra, 42 Cal.App.4th at p. 1607, 50 Cal.Rptr.2d 431.)

One of the more basic requirements is that the papers supporting a section 437c motion "shall include a separate statement setting forth plainly and concisely all material facts which the moving party contends are undisputed." (Id., subd. (b)(1), italics added; see Cal. Rules of Court, rule 342(d).) In addition, each material fact set forth in the separate statement "shall be followed by a reference to the supporting evidence." (§ 437c, subd. (b)(1).) "Citation to the evidence in support of each material fact must include reference to the exhibit, title, page, and line numbers." (Cal. Rules of Court, rule 342(d).)

As a reviewing court, we are often asked to determine whether a section 437c motion has complied with the statute. This decision is yet another object lesson for practitioners in the importance of (1) accurately identifying the facts material to the moving party's legal theory and (2) referencing evidence in the separate statement that establishes, either directly or by inference, the material fact that the moving party asserts is undisputed. (See generally Zebrowski, The Summary Adjudication Pyramid (Nov.1989) 12 L.A. Law. 28.)

II. Preemption of State Law Claims

The National Labor Relations Act (NLRA) (29 U.S.C. § 151 et seq.) governs labor-management relations in the private sector, and claims brought under that act are within the primary jurisdiction of the National Labor Relations Board (NLRB). Section 301 of the Labor Management Relations Act of 1947 (LMRA) (29 U.S.C § 185) makes private sector collective bargaining agreements (CBA's) enforceable in federal court. Both of these statutes preempt certain types of state law claims for retaliatory or wrongful discharge of employees.

A. Preemption Under the NLRA

The strand of federal preemption under the NLRA relevant to this case was announced by the United States Supreme Court in San Diego Unions v. Garmon (1959) 359 U.S. 236, 79 S.Ct. 773, 3 L.Ed.2d 775 (Garmon). Under the Garmon test, state law claims are preempted if they concern conduct that is "arguably" protected by section 7 or "arguably" prohibited by section 8 of the NLRA. (Garmon, supra, at p. 245, 79 S.Ct. 773.)² The United States Supreme Court stated:

"Since the [NLRB] has not adjudicated the status of the conduct for which the State of California seeks to give a remedy in damages, and since such activity is arguably within the compass of § 7 or § 8 of the [NLRA], the State's jurisdiction is displaced." (Gamon, at p. 246, 79 S.Ct. 773.)

The scope of preemption based on conduct that is arguably protected by the NLRA does not extend to state law claims where the activity regulated (1) is a "merely peripheral concern" of the NLRA (Garmon, supra, 359 U.S. at p. 243, 79 S.Ct. 773...