Xin Liu v. Amway Corp.

• Decision Date: 30 October 2003
• Docket Number: No. 01-57013.,01-57013.
• Citation: 347 F.3d 1125
• Parties: XIN LIU, Plaintiff-Appellant, v. AMWAY CORPORATION; Does 1-50 Inclusive, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

347 F.3d 1125

XIN LIU, Plaintiff-Appellant, v. AMWAY CORPORATION; Does 1-50 Inclusive, Defendants-Appellees.

No. 01-57013.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted October 8, 2002 — Pasadena, California.

Filed October 30, 2003.

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Ray Keramati, Western Legal Group, APC, San Diego, California, for the plaintiff-appellant.

Maria K. Aarvig, Creason & Aarvig, LLP, for the defendant-appellee.

Appeal from the United States District Court for the Central District of California; Virginia A. Phillips, District Judge, Presiding. D.C. No. CV-00-00256-VAP.

Before: Harry PREGERSON, Pamela Ann RYMER, and M. Margaret McKEOWN, Circuit Judges.

PREGERSON, J., delivered the opinion of the Court as to Parts I, IIA, IIB, IIC, and III in which McKEOWN, J., joined. RYMER, J., delivered the opinion of the Court as to Part IID, in which McKEOWN, J., joined. PREGERSON, J., filed a dissenting opinion as to Part IID. RYMER, J., filed an opinion concurring as to Parts I, IIC, and III, and dissenting as to Parts IIA and IIB.

OPINION

PREGERSON, Circuit Judge, with whom McKEOWN, Circuit Judge, joins.

Xin Liu appeals the district court's grant of summary judgment in favor of her former employer, Amway Corporation,¹ on her claims of sex discrimination and retaliation under Title VII of the Civil Rights Act, 42 U.S.C. §§ 2000e — 2000e-17 (2003), and the California Fair Employment and Housing Act (FEHA), Cal. Gov't Code §§ 12900-12996; interference with protected leave under the Family and Medical Leave Act (FMLA), 29 U.S.C. § 2612(a), and its state counterpart, the California Family Rights Act (CFRA), Cal. Gov't Code § 12945.2(a); breach of implied-in-fact contract and covenant of good faith and fair dealing; and violation of California public policy. The district court held that Liu failed to raise a genuine issue of material fact as to whether Amway's reasons for terminating her were pretextual and, therefore, granted Amway summary judgment on Liu's retaliation and discrimination claims under Title VII and FEHA. In addition, the district court held that Amway had not interfered with Liu's FMLA/CFRA leave because Liu was on leave when she was terminated. The court also dismissed her remaining claims on various state grounds.

We reverse the district court's grant of summary judgment on Liu's FMLA, CFRA, and violation of California public policy claims. We affirm the district court's grant of summary judgment on Liu's breach of her implied-in-fact contract claim, breach of the covenant of good faith and fair dealing claim, and Title VII and FEHA retaliation and discrimination claims. We remand to the district court for further proceedings in accordance with this opinion.

I. BACKGROUND

In May 1997, Xin Liu was the first scientist hired in the Concentrate Development Department of the Nutrilite Division of Amway Corporation ("the Department"). She was the most experienced member of her department consisting of four scientists. Her primary duties were the research and development of plant concentrates.

In October 1997, Liu's supervisor, David Groh, the group leader of the department, left the Nutrilite division. He was replaced by Kha Tran who then became Liu's supervisor.

On June 27, 1998, Liu went on maternity leave. She delivered her baby in early August and set her expected return date as September 19, 1998. While she was on leave, Tran assumed responsibility for her work. In his deposition, he claimed that he was forced to work evenings and sometimes weekends to "pick up the slack and do[] her job and mine at the same time." He estimated that he spent 30% of his time doing Liu's work. He stated that he was anxious to have her return.

In early September 1998, a few weeks before Liu was scheduled to return, Tran telephoned her to ask whether she would be returning to work on September 19th. According to Liu, Tran reminded her that he expected her to get back to work and that he had "been holding projects" for her. Liu responded that she had experienced fainting spells and fatigue and felt she needed more time to recover from childbirth. Tran allegedly replied "you can't die yet.... [w]e need you for the projects" and insisted she commit to a specific return date. She then requested an extension of her return date until December. Tran denied her request immediately. He stated again that she needed to return to work because he was holding projects for her.

About a week before her scheduled September return date, Liu and her husband visited her office to attend a birthday party for a co-worker and introduce their newborn baby to her fellow employees. During the birthday party, Tran asked her to meet him in his office where he demanded that she provide a firm return date. She again requested an extension of her leave until December to "recover from my pregnancy and bond with my baby." He denied the request but ultimately agreed to a shorter extension to November 16, 1998. Personnel records indicate that after this meeting, Tran transferred Liu from pregnancy leave status to a personal leave of absence.

Around the beginning of October, Liu decided to travel to China to provide needed care for her terminally ill father and to continue caring for and bonding with her newborn. She telephoned Tran again to ask for an extension until December. He refused. She contacted him again several times, asking for shorter extensions.² He refused. Liu then contacted the Human Resources Department and explained her situation. She was told that a member of the department would speak to Tran. A few days later, Tran called Liu to give her a one-week extension until November 23, 1998.

Around the end of September or the beginning of October, Tran was informed that the company would be experiencing a reduction-in-force and that Liu's department would be merging with another. He was told that at least one position in the department would be eliminated. Tran and two other employees were the central decision makers as to who would be eliminated.

In mid-October, shortly before Liu had planned to leave for China, Tran requested that she visit the company to review her annual performance evaluation. At the meeting, Tran informed Liu that he was reassigning her primary project to another employee. He further mentioned that the company was downsizing. He then gave Liu her performance evaluation. Her overall score was a 2.52, a 19% drop from the over-all score she had received six months earlier.

Liu's score placed her at the bottom of her department. Tran gave her the lowest possible score, a "one," in several categories including written communication, a category in which she had excelled in her previous evaluation. He also gave her a "one" in several "soft skills" such as "encourages self-development" and "holds people accountable for meeting goals."³ During the entire year of 1998, Tran did not give a "one" to a single employee other than Liu.

Liu's prior evaluation under her former supervisor, David Groh, was very positive. He gave her very high scores, a 3.1 overall, and remarked that she was an excellent scientist with very good written communication skills. Scores in her department ranged from 2.8 to 3.1, making Liu's score one of the two highest in a department of four. Groh testified that he could not recall ever criticizing her work either to her directly or to any other supervisor.

Around the third week of October, a decision to terminate Liu was made. Robin Dykehouse had primary responsibility of deciding which employee would be terminated. In doing so, she relied on the overall score and verbal recommendations given by division supervisors. According to Dykehouse, Tran characterized Liu as the weakest in his group and recommended her for termination.

On October 17, 1998, Liu left for China. Upon her return on November 18, 1998, Tran told her she had been terminated. Liu was the only scientist involuntarily terminated from her division. The only other scientist whose position was eliminated in the downsizing was reassigned instead of eliminated.

Liu brought this action in the District Court for the Southern District of California in April 2000. The case was transferred to the Central District of California (Eastern Division) on Amway's motion. Liu filed a Second Amended Complaint in September 2000. Amway moved for summary judgment on every cause of action. The court heard argument in September 2001. On October 1, 2001, the district court granted summary judgment in favor of Amway on all claims. Liu appeals.

II. DISCUSSION

We review a grant of summary judgment de novo. Weiner v. San Diego County, 210 F.3d 1025, 1028 (9th Cir.2000). We are governed by the same standard used by the trial court. Parker v. United States, 110 F.3d 678, 681 (9th Cir.1997). We must determine, viewing the evidence in the light most favorable to the nonmoving party, whether "there are any genuine issues of material fact and whether the district court correctly applied the relevant substantive law." Lopez v. Smith, 203 F.3d 1122, 1131 (9th Cir.2000) (en banc).

A. FAMILY AND MEDICAL LEAVE ACT AND THE CALIFORNIA FAMILY RIGHTS ACT

The parties do not dispute that Liu was entitled to unpaid leave under the FMLA and its state counterpart, CFRA, after her pregnancy disability leave expired.⁴ Liu was entitled to a maximum of four months of pregnancy disability leave under FEHA. Cal. Gov't Code § 12945. She was then entitled to an additional 12 weeks of leave to care for her baby or herself or a close relative with a serious illness under the FMLA, 29 U.S.C. § 2612(a), and CFRA, Cal. Gov't Code § 12945.2(a). Pregnancy disability leave under FEHA is a distinct and additional entitlement to that granted by FMLA and CFRA. Cal.Code Regs. tit. 2, § 7297.6(a) (2003).

We must decide whether there is a triable issue of fact as to whether Liu's protected rights to take FMLA...