Bryant v. San Diego Electric Co. CA4/1 (2015) · DecisionDepot
Bryant v. San Diego Electric Co. CA4/1
California Court of Appeal Oct 21, 2015 No. D066467Unpublished
Filed 10/21/15 Bryant v. San Diego Electric Co. CA4/1 NOT TO BE PUBLISHED IN OFFICIAL REPORTS California Rules of Court, rule 8.1115(a), prohibits courts and parties from citing or relying on opinions not certified for publication or ordered published, except as specified by rule 8.1115(b). This opinion has not been certified for publication or ordered published for purposes of rule 8.1115.
COURT OF APPEAL, FOURTH APPELLATE DISTRICT
DIVISION ONE
STATE OF CALIFORNIA
DAVID BRYANT, D066467
Plaintiff and Respondent,
v. (Super. Ct. No. 37-2011-00091876- CU-WT-CTL) SAN DIEGO GAS & ELECTRIC COMPANY,
Defendant and Appellant.
APPEAL from a judgment of the Superior Court of San Diego County,
Joan M. Lewis, Judge. Affirmed in part and reversed in part.
Jones Day, Edward P. Swan, Jr., Richard J. Bergstrom III and Matthew J. Silveira
for Defendant and Appellant.
The Gilleon Law Firm, Daniel M. Gilleon and James C. Mitchell for Plaintiff and
Respondent.
David Bryant sued his former employer, San Diego Gas & Electric Company
(SDG&E), for wrongful termination in violation of public policy, retaliation based on
SDG&E's alleged violation of Labor Code section 1102.5, and penalties under the Labor
Code Private Attorneys General Act of 2004 (PAGA) (Lab. Code, § 2698 et seq.).
(Undesignated statutory references are to the Labor Code; all references to section 1102.5
are to former section 1102.5, as amended in 2003.) Bryant alleged that SDG&E
wrongfully terminated his employment and retaliated against him because he raised
supervisory . . . behavior" and violated SDG&E's sexual harassment policy. SDG&E did
not provide that policy or specify its terms to the court despite the court's request.
SDG&E's Code of Business Conduct included a section entitled, "Discrimination
and harassment-free workplace." The Code of Business Conduct was presented as
evidence during trial, but not in connection with SDG&E's after-acquired evidence
defense. Instead, SDG&E merely questioned Bryant as to whether he had knowledge of
the Code of Business Conduct, including the section pertaining to harassment, and
whether he followed it. The discrimination and harassment section provided: "[r]emarks,
jokes or pictures that are offensive or discriminatory in any way aren't allowed in the
workplace. [¶] A supervisor who becomes aware of possible discrimination or
harassment must report the situation to the proper company contact at once. Any
supervisor who fails to do so is subject to disciplinary action, up to and including
termination of employment." A question and answer portion of the document stated:
"Sexually suggestive images are unacceptable in the workplace and should be removed at
once." SDG&E failed to inform the court that it was seeking to use its Code of Business
Conduct to support its after-acquired evidence defense. Based on the showing that
SDG&E made in connection with its after-acquired evidence defense, the trial court acted
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well within its discretion in excluding the evidence, especially where, as here, the court
provided SDG&E an opportunity to cure its deficient showing.
IV. Alleged Instructional Errors
SDG&E argues it should receive a new trial due to multiple instructional errors.
Specifically, SDG&E contends the "cat's paw" jury instruction on Bryant's wrongful
termination claim was not properly stated in the conjunctive and did not require the jury
to find a specific intent. SDG&E also argues the section 1102.5 cat's paw instruction
shared the same flaws as the wrongful termination cat's paw instruction, was unclear as to
whether it applied to Bryant's section 1102.5(a) or section 1102.5(c) claim, and reduced
the causation standard of proof from "substantial motivating reason" to "contributing
factor." Based on our conclusion that there was insufficient evidence to support the jury's
finding on Bryant's section 1102.5(a) claim and the jury's rejection of Bryant's section
1102.5(c) claim, we need not consider SDG&E's section 1102.5 alleged instructional
errors. On the wrongful termination cat's paw instruction, we reject SDG&E's arguments.
"We independently review claims of instructional error viewing the evidence in
the light most favorable to the appellant." (Orichian v. BMW of North America, LLC
(2014) 226 Cal.App.4th 1322, 1333.) " 'The refusal of a proper instruction is prejudicial
error only if " 'it seems probable' that the error 'prejudicially affected the verdict.'
[Citations.]" [Citation.] "[W]hen deciding whether an error of instructional omission was
prejudicial, the court must also evaluate (1) the state of the evidence, (2) the effect of
other instructions, (3) the effect of counsel's arguments, and (4) any indications by the
jury itself that it was misled." ' " (Ibid.)
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The cat's paw doctrine pertains to the element of causation. Under this theory,
employers may be held "responsible where discriminatory or retaliatory actions by
supervisory personnel bring about adverse employment actions through the
instrumentality or conduit of other corporate actors who may be entirely innocent of
discriminatory or retaliatory animus." (Reeves v. Safeway Stores, Inc. (2004) 121
Cal.App.4th 95, 116 (Reeves).) "Of course, proof of discriminatory animus does not end
the analysis of a discrimination claim. There must also be evidence of a causal
relationship between the animus and the adverse employment action." (DeJung v.
Superior Court (2008) 169 Cal.App.4th 533, 550.) The cat's paw doctrine rejects the
notion that an employer satisfies its duty of negating the causation element by showing
that the specific corporate actor who took the adverse employment action has no
discriminatory or retaliatory animus. (Id. at p. 551.) "[S]howing that a significant
participant in an employment decision exhibited discriminatory animus is enough to raise
an inference that the employment decision itself was discriminatory, even absent
evidence that others in the process harbored such animus." (Ibid.)
Here, on Bryant's wrongful termination claim, the trial court instructed the jury
with a modified version of CACI No. 2511 on the cat's paw theory:
"In this case, the recommendation to discharge David Bryant was made by Tina Chen-Peters and Nicole Galicia of SDG&E's Diversity Department. SDG&E claims that the decision to discharge David Bryant was based on this recommendation and was made by SDG&E's Director of Labor Relations and Human Resources, James Boland, and its Director of Field Services, Jorge DaSilva. Even if Tina Chen-Peters, Nicole Galicia, James Boland and Jorge DaSilva did not hold any retaliatory intent or were unaware of David Bryant's
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conduct on which his claim of retaliation is based, SDG&E may still be liable for retaliation if David Bryant proves both of the following:
"1. That David Bryant's protected activity was a substantial motivating reason for his supervisor, Phillip Heiner:
"a. Expanding Diversity's investigation of David Bryant by reporting other alleged misconduct by David Bryant to Tina Chen-Peters and Nicole Galicia;
"b. Providing misleading information to Tina Chen- Peters and Nicole Galicia;
"c. Agreeing with the recommendation to discharge David Bryant and telling Jorge DaSilva he agreed with such recommendation; and
"2. That Phillip Heiner's acts were a substantial motivating reason for Tina Chen-Peters' and Nicole Galicia's recommendation to discharge David Bryant, or to James Boland's and Jorge DaSilva's decision to discharge David Bryant based on that recommendation."
We reject SDG&E's argument that the cat's paw instruction was not properly
stated in the conjunctive and "the jury was free to find causation based solely on the last
element—Heiner's agreement with DaSilva's decision." First, reading the instruction as a
whole, it was stated in the conjunctive. It required the jury to find both that: (1) Bryant's
protected activity was a substantial motivating reason for Heiner doing three specified
acts, and (2) Heiner's acts were a substantial motivating reason for Chen-Peters and
Galicia's recommendation to discharge Bryant, or Boland's and DaSilva's decision to
discharge Bryant. Subpart (1) specified three distinct acts by Heiner, including
expanding the diversity department's investigation, providing misleading information,
and agreeing with the recommendation to discharge Bryant. Subpart (2) required the jury
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to find Heiner's "acts," were a substantial motivating reason for the recommendation or
decision to discharge Bryant. Because subpart (2) utilized the term "Heiner's acts" (stated
in the plural) and that reference was naturally to the three acts specified in subpart (1), we
reject the notion that the jury could have found causation based solely on Heiner's
agreement with the recommendation to discharge Bryant.
Based on our review of counsel's arguments, the parties did not suggest to the jury
that they could find causation based solely on one of Heiner's acts identified in subpart
(1) of the cat's paw instruction. Additionally, there was no indication that the jury was
misled in this regard. Bryant's counsel detailed in closing argument how Heiner
committed the acts identified in each subpart. There was nothing in counsel's argument
from which the jury could infer that only one of the subparts was required to prove
wrongful discharge. Lastly, we note that SDG&E failed to include a complete set of jury
instructions in the record on appeal. Accordingly, we are unable to evaluate the impact
of other jury instructions in determining prejudice.
SDG&E also contends the cat's paw instruction on Bryant's wrongful termination
claim was flawed because it failed to require that Heiner had a specific intent to cause
Bryant's termination. The cat's paw instruction provided to the jury in this case was
modeled after CACI No. 2511, which does not include the specific intent language that
SDG&E claims is required in the instruction. The instruction properly required the jury
to find that Bryant's protected activity was a substantial motivating reason for Heiner
committing specified acts and that those acts were a substantial motivating reason for
Bryant's discharge from employment. (See CACI No. 2511.) Further, based on the
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complete instruction and counsel's arguments, they conveyed to the jury that under the
cat's paw theory, it was required that Heiner "acted out of discriminatory or retaliatory
animus, and [his] actions were a but-for cause of the challenged employment action."
(Reeves, supra, 121 Cal.App.4th at p. 113.)
Based on the foregoing, we reject SDG&E's claims of instructional error.
V. Punitive Damages
SDG&E argues the jury's punitive damages award should be reversed because
there was insufficient evidence that a managing agent acted with malice. Alternatively,
SDG&E contends the punitive damages should be reduced because the amount awarded
was unconstitutionally excessive. We agree that there was insufficient evidence that a
managing agent acted with malice and, therefore, reverse the punitive damages award.
Based on our conclusion, we need not address whether the amount awarded was
unconstitutionally excessive.
Punitive damages generally may be awarded to a plaintiff in a civil action only if
"the defendant has been guilty of oppression, fraud, or malice." (Civ. Code, § 3294,
subd. (a).) "Malice" is defined as "conduct which is intended by the defendant to cause
injury to the plaintiff or despicable conduct which is carried on by the defendant with a
willful and conscious disregard of the rights or safety of others;" "oppression" is
"despicable conduct that subjects a person to cruel and unjust hardship in conscious
disregard of that person's rights;" and "fraud" means "intentional misrepresentation,
deceit, or concealment of a material fact known to the defendant with the intention on the
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part of the defendant of thereby depriving a person of property or legal rights or
Corporations may be held liable for punitive damages if there is "evidence that the
employer authorized or ratified a malicious act, personally committed such an act, or
wrongfully hired or retained an unfit employee. For corporate or other large
organizations, such conduct must have been performed by an ' "agent . . . employed in a
managerial capacity and . . . acting in the scope of employment," ' or ratified or approved
by a ' "managerial agent" ' of the organization." (College Hospital Inc. v. Superior Court
(1994) 8 Cal.4th 704, 723 (College Hospital).) In that regard, Civil Code section 3294,
subdivision (b), provides:
"An employer shall not be liable for [punitive] damages . . . based upon acts of an employee of the employer, unless the employer had advance knowledge of the unfitness of the employee and employed him or her with a conscious disregard of the rights or safety of others or authorized or ratified the wrongful conduct for which the damages are awarded or was personally guilty of oppression, fraud, or malice. With respect to a corporate employer, the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud, or malice must be on the part of an officer, director, or managing agent of the corporation." (Italics added.)
"Managing agents" are employees who "exercise[] substantial discretionary
authority over decisions that ultimately determine corporate policy." (White v. Ultramar,
Inc. (1999) 21 Cal.4th 563, 573 (White).) "[T]o demonstrate that an employee is a true
managing agent under [Civil Code] section 3294, subdivision (b), a plaintiff seeking
punitive damages would have to show that the employee exercised substantial
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discretionary authority over significant aspects of a corporation's business." (White, at
p. 577.)
Corporate ratification "generally occurs where, under the particular circumstances,
the employer demonstrates an intent to adopt or approve oppressive, fraudulent, or
malicious behavior by an employee in the performance of his job duties." (College
Hospital Inc., supra, 8 Cal.4th at p. 726.) Ratification amounts to essentially the
"confirmation and acceptance of [such] previous act." (Cruz v. Homebase (2000) 83
Cal.App.4th 160, 168 (Cruz).) However, "[a] corporation cannot confirm and accept that
which it does not actually know about." (Ibid.) Rather, there must be evidence that
officers, directors, or managing agents had actual knowledge of the malicious conduct
and its outrageous character. (See College Hospital, supra, 8 Cal.4th at p. 726.)
Here, SDG&E asserts there is no substantial evidence to support a finding that a
managing agent of SDG&E acted with malice. Preliminarily, we note that malice is not
the only conduct that could have supported the jury's punitive damages award. Rather, in
a special verdict form, the jury concluded SDG&E engaged in conduct constituting
"malice, oppression or fraud." Additionally, the jury's punitive damages award was not
necessarily limited to a finding that managing agents themselves acted with malice. In
addition to finding that one or more officers or managing agents committed conduct
constituting fraud, oppression or malice, the jury concluded officers, directors or
managing agents authorized, adopted, or approved of the malicious, fraudulent or
oppressive conduct.
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Because the jury's verdict does not specify exactly what conduct by SDG&E was
malicious, oppressive, and fraudulent, we review the evidence to determine whether there
is substantial evidence of any conduct committed or ratified by SDG&E that could be
found, by clear and convincing evidence, to have been malicious, oppressive, or
fraudulent. (Romo v. Ford Motor Co. (2002) 99 Cal.App.4th 1115, 1139.)
Malice, oppression, and fraud may be inferred from the circumstances of a
defendant's conduct. (Monge v. Superior Court (1986) 176 Cal.App.3d 503, 511.)
Bryant's primary argument at trial was that the diversity department's investigation of him
was conducted for the purpose of looking for a way to fire him. Bryant presented
evidence that although the investigation started based on an allegation of sexual
harassment, the diversity department expanded the investigation as a result of information
from Heiner that was not related to the sexual harassment charge. Thereafter, the
diversity department interviewed 40 people and concluded that Bryant engaged in
improper behavior. Some of the diversity department's findings were questionable. For
example, the diversity department concluded Bryant targeted certain employees by
conducting an excessive number of field observations on those employees. Although
there were documents on Bryant's actual field observations, the diversity department did
not review those documents before making its conclusions and instead relied on
"perceptions" of employees. Additionally, the diversity department's report partially
relied on a 2008 interim disciplinary report that was supposed to be removed from
Bryant's personnel file. Further, a member of the diversity department testified that
Bryant's personnel file included a "pattern of yelling." However, other than one incident
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described in the 2008 interim disciplinary report, the diversity department could not
identify any other instances of Bryant yelling and conceded that one incident does not
constitute a pattern. The diversity department did not give DaSilva or Boland, the
ultimate decision makers, a copy of its report to keep.
Bryant also presented evidence that he repeatedly complained about SDG&E's
tariff violations. At one point, Bryant was hushed or silenced when he complained. At
another point, Aguilar told Bryant he was difficult to deal with and threatened to fire
Bryant if Bryant did not stop complaining about SDG&E's tariff violations.
Assuming, without deciding, that these instances amounted to malicious or
oppressive conduct by SDG&E employees, we conclude there was insufficient evidence
that a managing agent committed or ratified the conduct. At trial, Bryant only identified
Boland as a managing agent. On appeal, however, Bryant asserts Aguilar, Heiner, and
DaSilva could also be considered managing agents for purposes of the punitive damages
award. We do not consider whether Aguilar, Heiner, and DaSilva were managing agents
as they were not presented as such to the jury. (Martinez v. Scott Speciality Gases, Inc.
(2000) 83 Cal.App.4th 1236, 1249 [" 'An argument or theory will generally not be
considered if it is raised for the first time on appeal.' "].)
Boland was clearly a managing agent. He was the Director of Labor Relations and
Human Resources. He managed essential parts of SDG&E and dealt with issues
potentially involving every employee of the company. Boland did not report to anyone
on matters of labor relations and gave the final word on behalf of the company.
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Accordingly, we review the record for substantial evidence to support a finding that
Boland committed or ratified malicious or oppressive conduct.
Bryant contends Boland committed or ratified malicious or oppressive conduct
because, despite Bryant's 23-year history with SDG&E, Boland did not sufficiently read
the diversity department's report before terminating Bryant's employment. However,
there was no evidence that Boland had actual knowledge that SDG&E employees
engaged in malicious or oppressive conduct. Specifically, there is nothing in the record
to suggest that Boland knew the diversity department's investigation was flawed or
improperly expanded. Further, there was no evidence that Boland had actual knowledge
that Bryant had complained about tariff violations. The parties have not pointed to and
we have not found anything in the record suggesting that Boland had actual knowledge of
any malicious or oppressive conduct and its outrageous character. (See College Hospital,
supra, 8 Cal.4th at p. 726.) The manner in which Boland handled Bryant's termination,
including merely skimming the diversity department's report and being unable to identify
the misconduct leading to Bryant's termination, was negligent at best.
Based on the foregoing, we conclude there was insufficient evidence to support
the jury's punitive damages award.
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DISPOSITION
The judgment on Bryant's section 1102.5(a) and PAGA claims is reversed.
Accordingly, the $10,000 in penalties assessed for the PAGA violation are reversed. We
also reverse the punitive damages award of $1,300,000. In all other respects, the
judgment is affirmed. Each party shall bear their own costs on appeal.
McINTYRE, Acting P. J.
WE CONCUR:
O'ROURKE, J.
IRION, J.
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AI Brief
AI-generated · verify before citing
Holding. The court held that there was insufficient evidence to support the plaintiff's Labor Code section 1102.5(a) and PAGA claims because the employer's alleged conduct did not constitute a rule or policy of general application, and reversed the punitive damages award. The court affirmed the judgment regarding the wrongful termination in violation of public policy claim.
Issues
Whether there was sufficient evidence to support a Labor Code section 1102.5(a) claim based on an employer's alleged rule or policy.
Whether the trial court abused its discretion in excluding after-acquired evidence.
Whether the PAGA claim was supported by a valid Labor Code violation.
Whether the jury's punitive damages award was supported by sufficient evidence.
Disposition. Affirmed in part and reversed in part.
Quotations verified verbatim against the opinion
“This statement does not constitute a rule or policy under section 1102.5(a) as it was directed specifically at Bryant.”
“We reverse the judgment as to Bryant's section 1102.5, subdivision (a) (section 1102.5(a)) and PAGA claims. We also reverse the punitive damages award. In all other respects, we affirm.”
“In our view, a plain reading of the definitions of rule and policy suggests that they must be intended to apply generally to a group or class, rather than to one of many members of a group or class.”