Sacramento Cnty. Retired Emps. Ass'n v. Cnty. of Sacramento

• Decision Date: 30 September 2013
• Docket Number: No. CIV S–11–0355 KJM–EFB.,CIV S–11–0355 KJM–EFB.
• Citation: 975 F.Supp.2d 1150
• Parties: SACRAMENTO COUNTY RETIRED EMPLOYEES ASSOCIATION; et al., Plaintiffs, v. COUNTY OF SACRAMENTO, Defendant.
• Court: U.S. District Court — Eastern District of California

975 F.Supp.2d 1150

SACRAMENTO COUNTY RETIRED EMPLOYEES ASSOCIATION; et al., Plaintiffs,

v.COUNTY OF SACRAMENTO, Defendant.

No. CIV S–11–0355 KJM–EFB.

United States District Court,

E.D. California.

Sept. 30, 2013.

Mark E. Merin, Law Office of Mark E. Merin, Sacramento, CA, for Plaintiffs.

Krista C. Whitman, Sacramento, CA, for Defendant.

ORDER

KIMBERLY J. MUELLER, District Judge.

This matter comes before the court upon defendant's motion for summary judgment. The court heard argument on June 28, 2013. Mark Merin appeared for plaintiffs; Krista Whitman appeared for defendant County of Sacramento. Following hearing, the court allowed brief supplemental filings, after which the matter was submitted. After considering the parties' briefing and arguments at the hearing, the court GRANTS defendant's motion for summary judgment.

I. BACKGROUND

On February 8, 2011, plaintiffs Sacramento County Retired Employees Association (“SCREA”), Prestwich, Rogers, Harding, Abernathy, Remson and Flores (collectively “plaintiffs”) filed a putative class action complaint against the County of Sacramento (“County”) on behalf of four subclasses ¹ of retired Sacramento County employees, challenging the County's decision to reduce or terminate a health and dental insurance subsidy for several classes of employees. Compl., ECF No. 1. Plaintiffs allege that since 1980, defendant has provided medical and dental insurance subsidies that assisted County retirees with their medical and dental insurance premiums through the Sacramento County Employee Retirement System (“SCERS”). ECF No. 1 ¶ 2. From 1993 to 2002, the Sacramento CountyBoard of Supervisors (“Board”) provided the subsidies “by resolution and set the amount at the highest HMO premium for non-Medicare eligible retirees.” Id. The Board froze the subsidy in 2003 at a maximum of $244 per month for medical insurance and a flat rate of $25 per month for dental insurance premiums, without distinguishing between former employees based on management status or union representation. Id. In 2007, the Board adopted its Retiree Medical and Dental Insurance Program Administrative Policy for 2008, eliminating subsidies for employees who retired after May 31, 2007. Id. ¶ 4. Six unions representing their members who were County employees challenged this action before the California Public Employment Relations Board (“PERB”), which issued a decision on June 30, 2009; according to the complaint, PERB ordered defendant to rescind the subsidy cut. (ECF No. 1 ¶¶ 4–5.) The Board did so, but only for those current and prospective retirees who were represented by the unions in the claim before the PERB. Id. ¶ 8. In 2010, the Board reduced the medical insurance subsidy to a maximum of $144 per month and eliminated the dental insurance subsidy for employees who had retired prior to June 1, 2007. Id. ¶¶ 3, 7. In 2011, the medical insurance subsidy was reduced to a maximum of $80.64 per month. Id. ¶ 3.

Plaintiffs allege four causes of action on behalf of themselves and their putative subclasses: 1) violation of the contract clause of Article I, Section 10 of the U.S. Constitution; 2) violation of the contract clause of Article I, Section 9 of the California Constitution; violation of the Equal Protection Clause of the Fourteenth Amendment to the U.S. Constitution; and 4) violation of the equal protection clause of Article I, Section 7 of the California Constitution. Id.

Defendant filed a motion to dismiss in lieu of an answer on April 1, 2011, arguing there was no express contract, it could not be bound by an implied contract, and it had a rational basis for treating the unionized employees differently. ECF No. 8.

On March 31, 2012, 2012 WL 1082807, this court denied the motion to dismiss, relying chiefly on the California Supreme Court's decision in Retired Employees Association of Orange County., Inc. v. County of Orange, 52 Cal.4th 1171, 1194, 134 Cal.Rptr.3d 779, 266 P.3d 287 (2011) (“REAOC III ”),² which found that “under California law, a vested right to health benefits for retired county employees can be implied under certain circumstances from a county ordinance or resolution.” Id. at 1194, 134 Cal.Rptr.3d 779, 266 P.3d 287.SeeECF No. 33 at 5. The court also concluded that whether the County could rationally treat the plaintiffs and their putative classes differently than the unionized employees who secured a favorable PERB decision was a question of fact not susceptible to resolution on a motion to dismiss. Id. at 10.

Defendant filed its answer on April 12, 2012. ECF No. 34.

The parties have stipulated to vacating the deadline for filing a class certification motion pending resolution of the instant motion for summary judgment. ECF No. 47.

II. EVIDENTIARY ISSUES

Under Rule 56 this court may consider only admissible evidence in support of or in opposition to summary judgment. “It is well settled that only admissible evidence may be considered by the trial court in ruling on a motion for summary judgment.” Beyene v. Coleman Sec. Servs., Inc., 854 F.2d 1179, 1181 (9th Cir.1988); FED. R. CIV. P. 56(c)(2). A court cannot consider inadmissible hearsay in opposition to a motion for summary judgment. Orr v. Bank of America, 285 F.3d 764, 773–74 (9th Cir.2002).

A. Defendant's Request For Judicial Notice

The County has asked the court to take judicial notice of a number of official records, including SCERS resolutions regarding the health insurance subsidies; staff reports to the Board, also on the topic of the health insurance subsidies; and the PERB decisions stemming from the County's changes to the subsidies. Defendant's Req. for Jud. Notice, ECF No. 44.

Under Rule 201 of the Federal Rules of Evidence, a court may take judicial notice of an adjudicative fact which “must be one not subject to reasonable dispute in that it is either (1) generally known ... (2) or capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned.” Courts have taken judicial notice of a Board of Supervisors' resolution and of administrative decisions. Merced Irrigation Dist. v. Cnty. of Mariposa, 941 F.Supp.2d 1237, 1261–62 (E.D.Cal.2013) (taking judicial notice of Board of Supervisors' resolution as matter of public record); Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir.2001) (stating a court may take judicial notice of matters of public record); Mack v. S. Bay Beer Distrib., Inc., 798 F.2d 1279 (9th Cir.1986), disapproved on other grounds by Astoria Fed. Sav. & Loan Ass'n v. Solimino, 501 U.S. 104, 111 S.Ct. 2166, 115 L.Ed.2d 96 (1991) (taking judicial notice of an administrative board decision). As plaintiffs do not contest their authenticity, this court takes judicial notice of the documents contained in ECF Nos. 44–1 through 44–5.

B. Plaintiffs' Exhibits

Plaintiffs' counsel has submitted a number of exhibits attached to his declaration, including a copy of an article from The Sacramento Bee; a report submitted to the County by CPA Richard Green; the United States Governmental Accounting Standards Board (GASB) Statement 45, referenced in Mr. Green's report; and literature issued by the County's Department of Employee Relations and Benefits to new retirees. In addition, counsel reports on the results of questionnaires he mailed to SCREA members in an effort to determine their understanding of the nature of the health insurance subsidy.

The newspaper article plaintiffs offer is hearsay: even if the statement plaintiffs seek to admit satisfies some hearsay exception, the author of the article has not provided a declaration affirming what County Counsel Ryan said. Larez v. City of Los Angeles, 946 F.2d 630, 642 (9th Cir.1991); Green v. Baca, 226 F.R.D. 624, 637–38 (C.D.Cal.2005). At oral argument, counsel conceded the article is hearsay; it is disregarded.

Plaintiff's counsel also attests to the results of a questionnaire he mailed to SCREA members. The results of surveys are not automatically inadmissible; criticisms of the format of the questions or the manner in which the survey was taken generally go to weight, rather than admissibility. See Fortune Dynamic, Inc. v. Victoria's Secret Stores Brand Mgmt., 618 F.3d 1025, 1036 (9th Cir.2010). In this case, because counsel has not provided the questions, the court is unable to evaluate their format or content. At oral argument, counsel described the questionnaire as “elaborate” and did not dispute opposing counsel's characterization that it called for narrative answers. As the court cannot determine from counsel's description how he derived his conclusions from the narrative responses to the questionnaires, the court will not consider the summary. See Gibson v. Cnty. of Riverside, 181 F.Supp.2d 1057, 1071 (C.D.Cal.2002) (declining to consider a chart under Rule 1006 when the county “ha[d] not even detailed with any particularity the methods employed in the investigation or its results.” (emphasis in original)).

Moreover, even though counsel said he mailed the questionnaire to all the SCREA members he could locate, he does not explain what percentage of County retirees are SCREA members. Accordingly, the fact that 85 percent of those responding believed they were entitled to a lifetime subsidy is of no weight.

III. ANALYSISA. Standard

A court will grant summary judgment “if ... there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” FED. R. CIV. P. 56(a). The “threshold inquiry” is whether “there are any genuine factual issues that properly can be resolved only by a finder of fact because they may reasonably be resolved in favor of either party.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986).³

The moving party bears the initial burden of showing the district court “that there is an absence of evidence to support the nonmoving party's case.” Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 91 L.Ed.2d...