John Doe v. Google, Inc.

• Decision Date: 21 September 2020
• Docket Number: A157097
• Parties: John DOE et al., Plaintiffs and Appellants, v. GOOGLE, INC., et al., Defendants and Respondents.
• Court: California Court of Appeals Court of Appeals

54 Cal.App.5th 948

268 Cal.Rptr.3d 783

John DOE et al., Plaintiffs and Appellants,

v.GOOGLE, INC., et al., Defendants and Respondents.

A157097

Court of Appeal, First District, Division 4, California.

Filed September 21, 2020

Baker Curtis & Schwartz, P.C.; Chris Baker and Deborah Schwartz, San Francisco, Counsel for Appellants.

Paul Hastings LLP; J. Al Latham, Jr., Cameron W. Fox, and Ankush Dhupar, Los Angeles, Counsel for Respondents Google Inc. and Alphabet, Inc.

Jackson Lewis P.C.; Mia Farber, Adam Y. Siegel, Los Angeles, Scott P. Jang, Dylan B. Carp, San Francisco, Counsel for Respondents Adecco USA, Inc.

TUCHER, J.

Google, Inc. and Alphabet, Inc. (collectively, Google), and Adecco USA, Inc. (Adecco) require their employees to comply with various confidentiality policies. John Doe, David Gudeman, and Paola Correa, who are current and former Google and Adecco employees, sued Google and Adecco under the Labor Code Private Attorneys General Act of 2004 (PAGA) ( Lab. Code, § 2698 et seq. ), alleging the employers’ confidentiality policies restricted their employees’ speech in violation of California law. The trial court sustained defendants’ demurrers without leave to amend, concluding plaintiffs’ claims were preempted by the National Labor Relations Act (NLRA or Act) ( 29 U.S.C. § 151 et seq. ) under San Diego Bldg. Trades Council v. Garmon (1959) 359 U.S. 236, 244–245, 79 S.Ct. 773, 3 L.Ed.2d 775 ( Garmon ). Plaintiffs contend the trial court erred in finding the NLRA preempted their PAGA claims. They further challenge the trial court's denial of a petition to coordinate this case with another case pending in a different trial court.

We conclude that, although many of plaintiffs’ claims relate to conduct that is arguably within the scope of the NLRA, the claims fall within the local interest exception to Garmon preemption and may therefore go forward. We also conclude that plaintiffs’ challenge to the trial court's coordination petition is not properly before us. We will therefore reverse the trial court's orders sustaining defendants’ demurrers without leave to amend and remand for further proceedings.

BACKGROUND

Because this appeal comes to us on demurrer, the following facts are based on the allegations in plaintiffs’ pleadings and the requests for judicial notice.¹

Litigation Regarding Confidentiality Policies

Doe works as a product manager in a supervisory capacity at Google. He began work at Google in July 2014, had his employment terminated in April 2016, and was reinstated in June 2016. After being terminated and before being reinstated, Doe sent notice under PAGA to the California Labor and Workforce Development Agency that he intended to file this suit on behalf of himself and other current and former Google employees. Doe alleged that Google required employees to sign a confidentiality agreement and imposed certain related confidentiality policies on its employees, and that these policies violated the Labor Code. Six months later, Doe filed this case in San Francisco Superior Court. (John Doe et al. v. Google Inc. et al (Super. Ct. S.F. City & County, 2016, No. CGC-16-556034) (Doe ).)

Gudeman is a former Google employee, and Correa is a former Google employee who also worked for Adecco as a temporary employee placed at Google. Doe's second amended complaint included them as named plaintiffs, and added claims against Adecco based on Correa's experience there.

Shortly after plaintiffs filed their second amended complaint, Rachel Moniz filed a complaint against Adecco in San Mateo Superior Court alleging claims based on Adecco's confidentiality policies. (Moniz v. Adecco (Super. Ct. San Mateo County, 2017, No. 17-CIV-01736) (Moniz ).) Ten days later, plaintiffs filed their third amended complaint against Google and Adecco.

The Harms Alleged

Plaintiffs’ third amended complaint alleges 17 causes of action under PAGA based on defendants’ confidentiality policies. Plaintiffs’ confidentiality claims fall into three subcategories; restraints of competition, whistleblowing, and freedom of speech.

In their competition causes of action plaintiffs allege that Google's confidentiality rules violate state statutes by preventing employees from using or disclosing the skills, knowledge, and experience they obtained at Google for purposes of competing with Google. For example, the policies prevent Googlers from disclosing their wages in negotiating a new job with a prospective employer, and from disclosing who else works at Google and under what circumstances such that they might be receptive to an offer from a rival employer. The complaint grounds these PAGA claims on alleged violations of Business & Professions Code sections 17200, 16600, and 16700² and various provisions of the Labor Code (see Lab. Code, §§ 232, 232.5, 1197.5, subd. (k) ).

Plaintiffs’ whistleblowing causes of action allege that Google's confidentiality rules prevent employees from disclosing violations of state and federal law, either within Google to their managers or outside Google to private attorneys or government officials. (See Bus. & Prof. Code, §§ 17200 et seq. ; Lab. Code, § 1102.5.) They also allege the policies unlawfully prevent employees from disclosing information about unsafe or discriminatory working conditions, or about wage and hour violations. (See Lab. Code, §§ 232, 232.5.)

In their freedom of speech claims, plaintiffs allege that defendants’ confidentiality rules prevent employees from engaging in lawful conduct during non-work hours and violate state statutes entitling employees to disclose wages, working conditions, and illegal conduct. (See Lab. Code, §§ 96, subd. (k), 98.6, 232, 232.5, 1197.5, subd. (k).) This lawful conduct includes the exercise of an employee's constitutional rights of freedom of speech and economic liberty. As a practical matter, plaintiffs argue, they are forbidden even to write a novel about working in Silicon Valley or to reassure their parents they are making enough money to pay their bills, matters untethered to any legitimate need for confidentiality.

Google's confidentiality rules contain a savings clause stating that the company's rules were not intended to limit employees’ right to discuss wages, terms, or conditions of employment with other employees, or their right to communicate with government agencies regarding violations of law. However, plaintiffs allege these clauses are meaningless and contrary to Google's policies and practices of enforcement, which threaten employees for disclosing any information at all.

Plaintiffs allege Adecco was liable for both its own confidentiality policies and Google's because Adecco was Correa's joint employer when she was placed at Google. Adecco admits that in ruling on the demurrers "there is no meaningful difference between [the] claims against Google and those against Adecco."

Demurrers

Google demurred to the entire complaint. As relevant here, Google argued the NLRA preempted plaintiffs’ confidentiality claims. The trial court sustained Google's demurrer to the confidentiality claims without leave to amend. It overruled the demurrer only as to a single remaining cause of action—alleging defendants required employees to sign illegal releases of potential claims as a condition of being hired—and the parties eventually settled that claim.

Adecco demurred to the third amended complaint as well, shortly after it filed a similar demurrer in Moniz . The Moniz court overruled the demurrer, but the Doe court sustained Adecco's demurrer to the confidentiality claims, with leave to amend, for the same reasons that it sustained Google's demurrer.

Proceedings Specific to Adecco

Plaintiffs tried to cure the defects identified by the Doe court as to their claims against Adecco by filing a fourth amended complaint. This complaint retains the allegation that Adecco is jointly liable under PAGA for Google's confidentiality rules, but adds separate claims on behalf of Adecco employees statewide based on Adecco's own confidentiality rules. The new causes of action against Adecco fall into the same competition, whistleblowing, and free speech categories as the claims against Google in the third amended complaint. Plaintiffs also allege Adecco had an unlawful policy prohibiting temporary employees placed at Google from working directly for Google without Adecco's consent.

Adecco again demurred, and the trial court sustained the demurrer, this time without leave to amend. Plaintiffs then amended their Doe complaint a final time to add an illegal release claim against Adecco, a claim the parties subsequently settled.

Before Adecco filed its demurrer to the third amended complaint, it filed with the Judicial Council a petition to coordinate the action with Moniz . After plaintiffs filed their fourth amended complaint and shortly before Adecco demurred to it, the coordination judge continued proceedings on Adecco's petition until after the ruling on Adecco's forthcoming demurrer. Then, after the Doe court sustained Adecco's demurrer to the fourth amended complaint without leave to amend, the coordination judge denied the petition to coordinate, explaining that the sole then-remaining cause of action in Doe (the illegal release claim) was not at issue in Moniz , the claims in Moniz covered more employees than the claim in Doe , and the Moniz litigation had advanced further.

Adecco filed a petition for writ of mandate in this court seeking review of the coordination judge's denial of its coordination petition. Plaintiffs likewise filed a petition for writ of mandate, seeking review of the Doe court's orders sustaining Google's and Adecco's demurrers. This court summarily denied Adecco's writ and denied plaintiffs’ writ as untimely. (Adecco USA, Inc. v. Superior Court for the City & County of San Francisco (Feb. 6, 2018, A153470) [nonpub. opn.]; Doe et al. v. Superior Court for the City & County of San Francisco (Mar. 29, 2018, A153726) [nonpub. opn.].)

The trial court in Doe entered final...