Hudson v. Moore Business Forms, Inc.

• Decision Date: 22 May 1985
• Docket Number: No. C-84-2104-MHP.,C-84-2104-MHP.
• Citation: 609 F. Supp. 467
• Parties: Ida HUDSON, Plaintiff, v. MOORE BUSINESS FORMS, INC., a corporation, Joe McArthur, Edward Glover, William McLean, Jim Clark as Doe I, and Does II through XXXX, inclusive, Defendants.
• Court: U.S. District Court — Northern District of California

609 F. Supp. 467

Ida HUDSON, Plaintiff, v. MOORE BUSINESS FORMS, INC., a corporation, Joe McArthur, Edward Glover, William McLean, Jim Clark as Doe I, and Does II through XXXX, inclusive, Defendants.

No. C-84-2104-MHP.

United States District Court, N.D. California.

January 4, 1985.

Supplemental Opinion May 22, 1985.

COPYRIGHT MATERIAL OMITTED

Marilyn MacRae, Oakland, Cal., for plaintiff.

Henry D. Lederman, Littler, Mendelson, Fastiff & Tichy, San Francisco, Cal., for defendants.

MEMORANDUM DECISION AND ORDER

PATEL, District Judge.

Plaintiff Ida Hudson initiated this suit in state court against her former employer, Moore Business Forms, Inc. ("Moore"), and some of her former superiors at Moore, Joe McArthur, Edward Glover, William McLean and Jim Clark. She alleges that Moore violated the Federal Equal Pay Act, 29 U.S.C. § 206(d)(1), Cal.Lab.Code § 1197.5, and the California Fair Employment and Housing Act ("CFEHA"), Cal.Gov't Code § 12920 et seq. She also asserts several pendent state law claims including breach of employment contract, breach of the implied covenant of good faith and fair dealing, and interference with advantageous economic relations. She alleges that defendants McArthur, Glover, McLean and Clark violated the CFEHA and are guilty of interference with advantageous economic relations.

Defendants removed the action to this court and filed a counterclaim, alleging that plaintiff violated Cal.Lab.Code §§ 2854, 2856-59, and 2865, and breached duties of loyalty and good faith and fair dealing.

Defendants have filed a motion for partial summary judgment on plaintiff's complaint. Defendants McArthur, Glover, McLean and Clark have also moved to dismiss for lack of jurisdiction and/or summary judgment, with McArthur, Glover, and Clark alleging that this court lacks in personam jurisdiction over them, and all four individuals contending that the doctrine of "managerial immunity" shields them from plaintiff's CFEHA and tort claims. Plaintiff has moved for summary judgment on the counterclaim.

All of these motions were heard in this court on November 26, 1984. After careful consideration of the memoranda, oral argument, and other materials submitted by the parties, the court has determined that defendants' motion for partial summary judgment must be granted in part and denied in part. Defendants' motion to dismiss for lack of jurisdiction and/or for summary judgment is also granted in part and denied in part. Plaintiff's motion for summary judgment on the counterclaim is granted.

I. Factual Background

Plaintiff was hired by Moore as a collection correspondence clerk in its Credit Department, Western Area Administrative Department, on September 25, 1968. Ms. Hudson, according to all parties, performed her duties competently and creditably, and on June 12, 1974 was promoted to the position of major accounts collector in the credit department. Her work in that department continued, and on August 1, 1975 she was appointed assistant credit manager. On January 1, 1978 she was appointed to the position of credit manager. On September 23, 1980, Moore announced a major reorganization within the company and indicated that most of the functions of the Western Area Administrative Department would be transferred to its facility in Denton, Texas. Plaintiff stayed with Moore until March 15, 1982, when the credit department closed and she was terminated. At that time she received a total of $10,932.06 in special incentive to stay and severance payments.

Plaintiff alleges that from the time she was promoted to the position of major accounts collector on June 12, 1974 until she was terminated on March 15, 1982, both Moore and the individually-named defendants paid her less than male employees who performed substantially similar work. She also alleges that all of the defendants deliberately prevented her from continuing with the company when the Bay Area facility was closed by refusing to offer her an opportunity to transfer to the Texas facility. Defendants deny that plaintiff was paid less than male employees with comparable duties, and allege that plaintiff was indeed offered opportunities to continue with the company. They contend further that plaintiff deliberately refused opportunities to continue with the company so that she could institute actions for wage discrimination and wrongful termination against defendants.

II. Defendants' Motion for Partial Summary Judgment

A. First Cause of Action: Time Limitation on Plaintiff's Equal Pay Act Claims

Plaintiff alleges that between the time of her initial promotion to a management position at Moore on June 12, 1974 and her termination on March 15, 1982 defendants violated 29 U.S.C. § 206(d)(1) and Cal.Lab.Code § 1197.5 by paying her less than male employees with comparable duties solely on the basis of her sex. She requests damages for the entire period of the alleged violation. Defendants deny plaintiff's claims, and contend in their motion for summary judgment that even if plaintiff should be successful in proving wage discrimination her recovery would be limited to the two-year period prior to the filing of her complaint, or three years if a willful violation is proved. Thus, if plaintiff is successful in proving willful wage discrimination she will, according to defendants, be entitled to recover for claims only dating back to August 5, 1980.

The relevant statutes clearly limit plaintiff's recovery to the two-year period prior to filing of the complaint, or to the three years prior if the wage discrimination is proved willful. 29 U.S.C. § 255(a); Cal. Lab.Code § 1197.5(h). Plaintiff alleges that since the violations were continuous she should be able to recover for the entire period of discrimination. There is no authority for this proposition. Should plaintiff prove her wage discrimination claim, her recovery will thus be limited according to the above-noted statutes.

B. Second Cause of Action: Plaintiff's Claim for Wage Discrimination and Discriminatory Failure under the CFEHA

1. Wage Discrimination Claim

Plaintiff alleges that defendants violated the CFEHA, Cal.Gov't Code § 12920 et seq., by failing to pay her wages commensurate with those paid to her male colleagues. Defendants contend that since plaintiff failed to raise this claim before the California Department of Fair Employment and Housing ("DFEH"), she is barred from making that claim now.

California law requires that administrative remedies provided by statute for the redress of certain wrongs must ordinarily be invoked and exhausted before those claims can be brought before the courts. Bennett v. Borden, Inc., 56 Cal.App.3d 706, 709, 128 Cal.Rptr. 627 (1976). Indeed, such exhaustion is a "jurisdictional prerequisite to resort to the courts." Id. The CFEHA created the Department of Fair Employment and Housing to administer its provisions and investigate allegations of wrongful conduct. Cal.Gov't Code § 12930-33. In her complaint before the DFEH, plaintiff alleged that she was "subjected to differential treatment, denied an equal opportunity to transfer and subsequently terminated because of my age, 52, and my sex and marital status, Married Female...." (Liem Decl., Exh. "A" at 1). She then particularized her "differential treatment" allegations by specifying the facts surrounding the purportedly wrongful failure to transfer. Id. at 1-2. She nowhere alleges a wage discrimination claim, and, therefore, has not exhausted her administrative remedies with respect to that claim.

Plaintiff nevertheless insists that the claim should not now be barred because her allegation of "differential treatment" in the DFEH charge was sufficient to lead to an investigation which would have revealed the wage discrimination claim, even though no specific mention was made of such a claim. She relies for this proposition on a series of decisions of the Court of Appeals for the Ninth Circuit, which held that EEOC charges which did not make specific discrimination allegations were still sufficient to permit those claims to be raised in a court action because an investigation based on the original charges would have "revealed" the allegations made for the first time in the court proceeding. Plaintiff's reliance on these cases is misplaced.

In Serpe v. Four-Phase Systems, Inc., 718 F.2d 935 (9th Cir.1983), the plaintiff brought a Title VII action against her former employer, alleging, among other things, that it had refused to transfer her from the "technical division to the sales division," where employees were paid on a higher wage scale, solely on the basis of her sex. Id. at 936. This specific claim had not appeared in her EEOC charge. In that document she had alleged other specific acts of discrimination against her, and had discussed how females as a class were discriminated against with respect to classifications within the sales department. Id. at 936-37. The court concluded that the EEOC charge was "sufficient to sustain its subject-matter jurisdiction" over the failure to transfer claim because "an investigation of the charges made in the quoted language would have revealed plaintiff's claim that she did request transfers and that, because she is a woman, her requests were denied." Id. at 937. Ms. Serpe made specific reference to discriminatory practices in the sales department in her EEOC charge, while Ms. Hudson's discussion of "differential treatment" in her DFEH charge was based solely on the alleged failure to offer a transfer, with no mention of any wage discrimination.

In Chung v. Pomona Valley Community Hospital, 667 F.2d 788 (9th Cir.1982), the plaintiff brought actions under Title VII and 42 U.S.C. § 1981 against his former employer (the hospital) and individual doctors and supervisors, alleging race discrimination. The district court held that most of Chung's Title VII and all of his § 1981 claims were "stale" because he had failed to specifically allege "a pattern of discrimination" in...