Opinion
H047715
04-05-2022
MAZEN ARAKJI, Plaintiff and Appellant, v. GOODWILL OF SILICON VALLEY, Defendant and Respondent.
NOT TO BE PUBLISHED
Santa Clara County Super. Ct. No. 19CV343442
Danner, J.
Plaintiff and appellant Mazen Arakji appeals an order sustaining a demurrer without leave to amend in this civil discrimination and harassment action against his former employer, defendant and respondent Goodwill of Silicon Valley (Goodwill). The trial court ruled that Arakji's entire complaint was barred by the claim preclusive effect of an earlier small claims action Arakji had brought against Goodwill. The trial court also decided the preclusive bar could not be cured by amendment to the complaint.
On appeal, Arakji contends that his claims are not barred because the causes of action he asserted in his prior small claims lawsuit are not embraced within the instant action and do not allege violations of the same primary rights. For the reasons explained below, we reject Arakji's arguments and conclude that both lawsuits asserted equivalent claims of unlawful discrimination and harassment by Goodwill in violation of the California Fair Employment and Housing Act (FEHA) based on factual allegations that could have been presented in the earlier action. We therefore affirm the trial court's dismissal of the complaint on the ground that Arakji is precluded by the earlier judgment against him.
I. FACTS AND PROCEDURAL BACKGROUND
On appeal from the sustaining of a demurrer, we accept as true the facts as alleged in the operative complaint. (Aryeh v. Canon Business Solutions, Inc. (2013) 55 Cal.4th 1185, 1189, fn. 1.) We also accept as true facts of which a court may take judicial notice, though we do not assume the truth of contentions, deductions, or conclusions of law. (Yvanova v. New Century Mortgage Corp. (2016) 62 Cal.4th 919, 924 (Yvanova).)
A. Facts
In April 2017, Arakji attended an information session for the Employment Readiness Program (program) at Goodwill of Silicon Valley. Arakji has a "very obvious musculoskeletal disability" in his left arm which limits his ability to grip and lift heavy objects. At the time he attended the information session for the program, Arakji was homeless and "deeply traumatized" after several adverse life experiences and after having struggled to obtain employment despite having enjoyed earlier academic and professional success. Arakji is a citizen of the United States, born in Lebanon and of Arabic ancestry, and wears a long beard "[f]or Muslim religious purposes."
Arakji holds bachelor's and master's degrees from the University of Colorado Boulder in electrical and computer engineering as well as certifications in subjects including but not limited to embedded systems engineering and design, software engineering, and research and development engineering management.
The Goodwill information session was held on April 25, 2017. The Employment Readiness Program provides six to 12 months of paid work experience with employability skills workshops that are designed to prepare people with barriers to employment to enter or reenter the workforce. Arakji filled out an application, noting his educational and professional background and stating that he was homeless and disabled. From among the positions available through the program, Arakji requested placement in either "E-commerce" or "Shipping and Receiving."
Arakji interviewed with the department manager and team lead. A few days later, the head of the Employment Readiness Program department, Sonia, informed him those positions were no longer available. Seeking to relieve himself from homelessness, Arakji expressed interest in the "Customer Service Specialist" position. Several months passed before Arakji could enter the program. On July 25, 2017, Arakji started a position in the customer service specialist role. Though he had informed Sonia that his primary interest was e-commerce and he preferred to switch to that role at the earliest opportunity, Goodwill did not allow him to move to the e-commerce department until October 2017.
We refer to the employees named in Arakji's complaints in both actions by their first name, consistent with the references in his briefing on appeal.
In May 2017, Sonia informed Arakji that before joining the program, he would need to provide a note from a physician that stated the limits of his disability. Arakji provided his note to Goodwill. In October 2017, the store manager at the Goodwill location where Arakji worked created a cleaning schedule which required the employees, including Arakji, to clean the bathroom on an approximately bi-monthly rotation. Arakji explained that he could not clean the bathroom due to his disability. Bebe, Goodwill's head of human resources, pressured Arakji to specify what about his disability prevented him from doing the task and was told that his refusal would be insubordination. There were also instances in which his efforts to complete the assigned task of sorting and putting away clothing from a rack were unfairly criticized, and his request to change locations to a Goodwill retail store more convenient to the housing he had secured was rejected.
B. Procedural Background
1. Small Claims Lawsuit
In November 2018, Arakji filed a lawsuit against Goodwill in the small claims division of the Santa Clara County Superior Court (small claims lawsuit). Arakji's small claims lawsuit asserted unlawful "[d]iscrimination and harassment due to religious creed, national origin, ancestry, and disability," in violation of Government Code section 12940. Arakji identified himself as an "eggshell plaintiff" and claimed damages of $10,000 for "emotional pain and suffering" based on two alleged instances of discrimination and harassment by Andrea, Arakji's supervisor at the Goodwill store.
Unspecified statutory references are to the Government Code.
Arakji claimed that on August 9, 2018, Andrea "threatened to testify falsely" against him "in order to feign insubordination" on his part. After he told her that no insubordination had occurred, she agreed but told him" 'It's my word against yours, '" and when he asked her what she meant, she looked at him and said," 'You know what I mean.'" Arakji alleged that Andrea claimed he had to follow her directives even while on his lunch break and before clocking back in.
Arakji also asserted that on October 27, 2018, while he was stationed at the register, Andrea insisted a fan be pointed exclusively at him even after he told her that he felt cold. Arakji alleged that Andrea told him," 'If I want to point [the fan] at someone, then thats [sic] the way I point it.' "
Arakji stated that he obtained a" 'right to sue'" notice from California's Department of Fair Employment and Housing (DFEH) on November 28, 2018. He filed his small claims lawsuit the next day.
On January 30, 2019, after a hearing, the small claims court found there was "[i]nsufficient evidence shown" and ordered that Arakji "takes nothing" and Goodwill "does not owe plaintiff any money on plaintiff's claim." The small claims court entered judgment in favor of Goodwill.
2. Unlimited Civil Action
On February 28, 2019, less than one month after entry of judgment in the small claims lawsuit, Arakji filed the instant, unlimited civil action (civil action) seeking damages and injunctive relief. Arakji's complaint asserted five causes of action for unlawful discrimination and harassment under section 12940, claiming: (1) "Denial of employment due to religious creed, national origin, ancestry, and disability"; (2) "Job applicant inquiries as to the nature or severity of a disability"; (3) "Limitation and segregation in employment due to religious creed, national origin, ancestry, and disability"; (4) "Harassment in employment due to religious creed, national origin, ancestry, and disability"; and (5) "Employee inquiries as to the nature or severity of a disability." According to the complaint, the events underlying the claims for relief occurred between April 2017 and November 2017, and Arakji obtained his "right-to-sue" notice from DFEH on March 1, 2018.
In support of his first claim for relief under section 12940, Arakji alleged that for approximately six months between April 2017 and October 2017, Goodwill denied him employment in the e-commerce role he requested, not because the position was unavailable (as he had been told) but due to unlawful discrimination based on his "religion, national origin, ancestry, ethnic characteristics and disability." Arakji claimed that rather than hire him for the e-commerce department, Goodwill isolated, segregated, and discriminated against him based on his religion, national origin, ancestry, and disability.
Arakji made similar allegations in support of the remaining claims for relief. He alleged in his second claim that Goodwill delayed hiring him for three months after he applied to the program, based on his religion, ancestry, and disability, and in doing so "intended to force [him] out of the homeless shelter to sleep outside and to delay [his] progress in rebuilding [his] life." He alleged in his third claim that in October 2017, while employed as a customer service specialist, he was criticized for moving too slowly while sorting and restocking clothes. Arakji stated that his approach was systematic and efficient, yet he was pressured to move faster and told to perform the task in a different way, causing pain to his left hand. Arakji claimed the defendant "purposefully intended to harass" him to move faster because Goodwill "is revolted by people of [his] religion, national origin, ancestry, ethnic characteristics and disability, and especially those with a combination of all of the above." Arakji alleged in his fourth claim that Goodwill refused to approve his request to transfer store locations on these same, unlawful grounds. He asserted that because of Goodwill's discriminatory views of people of his religion, national origin, ancestry, and disability, Sonia rejected his request to move to the store that would be more convenient to his new housing, and the reason she gave for the refusal was false. Lastly, in his fifth claim, Arakji alleged on the same, discriminatory grounds that the store manager and Bebe in human resources pressured him to describe the nature and extent of his disability in regard to why he was unable to clean the bathroom, though it was a "nonessential function" of the job as defined by section 12926.
On May 10, 2019, Goodwill filed a demurrer and motion to strike the complaint. Goodwill asserted the complaint was barred by the doctrine of res judicata (claim preclusion), based on the judgment in the small claims lawsuit. Goodwill further asserted the complaint failed to state a cause of action upon which relief may be granted because Arakji had failed to allege an actionable adverse employment action. In support of its motion, Goodwill requested that the trial court take judicial notice of the complaint and judgment in the small claims lawsuit.
Goodwill argued that Arakji's complaint, and his earlier, small claims complaint, both invoked the same "primary right" to be free from discrimination on the basis of religious creed, national origin, ancestry, and disability, as proscribed by FEHA. Because claim preclusion prevents relitigation of the same cause of action in a second suit between the same parties, as determined by the primary rights theory, Goodwill maintained that Arakji was barred from alleging violations of section 12940 based on events that could have been alleged in the original complaint in the small claims lawsuit. Goodwill also argued that Arakji's action for unlawful discrimination failed to state a cause of action because Arakji had alleged no facts to suggest any adverse employment action taken by Goodwill. Arakji was still employed at Goodwill at the time of the demurrer.
Arakji filed written opposition to the demurrer. After a hearing on August 22, 2019, the trial court issued a tentative ruling sustaining the demurrer without leave to amend, explaining it did "not see any way" for Arakji to allege FEHA violations against Goodwill "premised on discrimination and harassment due to religious creed, national origin, ancestry, and disability during his employment . . . that would not be subject to the res judicata/collateral estoppel effect" of the small claims judgment. The trial court in its tentative order also found it unnecessary, in light of its ruling on the demurrer, to address Arakji's arguments directed at the individual causes of action and therefore deemed the motion to strike moot.
On October 22, 2019, the trial court adopted its tentative order. It granted Goodwill's request for judicial notice of both the complaint and judgment in the small claims lawsuit and sustained the demurrer to the entire complaint. The trial court explained that Arakji's complaint "is barred by the res judicata/collateral estoppel effect of the January 30, 2019 Judgment in the prior small claims action, in which Plaintiff previously alleged the Defendant had violated the FEHA by discriminating against him and harassing him on the basis of 'religious creed, national ancestry, and disability.' "
On October 29, 2019, Goodwill filed a notice of entry of order of the trial court's October 22, 2019 order sustaining the demurrer without leave to amend. On December 26, 2019, Arakji filed a notice of appeal from the order sustaining the demurrer without leave to amend. " 'Orders sustaining demurrers are not appealable.' [Citation.] But 'an appellate court may deem an order sustaining a demurrer to incorporate a judgment of dismissal.'" (Zipperer v. County of Santa Clara (2005) 133 Cal.App.4th 1013, 1019.) Although Arakji's appeal was taken from a nonappealable order, Goodwill appropriately notes in its respondent's brief and in a motion to augment the record that on December 6, 2019, subsequent to entry of the order sustaining the demurrer, the trial court entered an order of dismissal. This court granted Goodwill's motion to augment the record with the order of dismissal. Consistent with the requirement that notices of appeal are to be liberally construed so as to protect the right of appeal where it is reasonably clear what the appellant sought to appeal from, and where the respondent could not have been misled or prejudiced (see Cal. Rules of Court, rule 8.100(a)(2); K.J. v. Los Angeles Unified School Dist. (2020) 8 Cal.5th 875, 882), we construe the appeal to have been taken from the judgment of dismissal. (Los Altos Golf & Country Club v. County of Santa Clara (2008) 165 Cal.App.4th 198, 202.)
II. DISCUSSION
Arakji contends he is not precluded from asserting the claims in his complaint because the causes of action in his small claims lawsuit are not present in the instant action and are not based on the same primary right. Further, he argues the issues litigated in the earlier lawsuit are not identical to the issues raised here.
We first set forth our standard of review and applicable general legal principles. We note that the preferred terminology for discussing the law of preclusion- traditionally referred to as "res judicata"-has shifted in recent years. We use the term "claim preclusion" to refer to the doctrine addressing claims that were, or should have been, advanced in a previous suit involving the same parties, and we use" 'issue preclusion'" in place of" 'direct or collateral estoppel'" to refer to the doctrine barring relitigation of issues that were argued and decided in an earlier suit. (See Samara v. Matar (2018) 5 Cal.5th 322, 326 (Samara); DKN Holdings LLC v. Faerber (2015) 61 Cal.4th 813, 824 (DKN Holdings).)
A. Legal Principles
1. Standard of Review
We independently review the trial court's order sustaining a demurrer without leave to amend. (Lee v. Hanley (2015) 61 Cal.4th 1225, 1230.) "For purposes of reviewing a demurrer, we accept the truth of material facts properly pleaded in the operative complaint, but not contentions, deductions, or conclusions of fact or law. We may also consider matters subject to judicial notice. [Citation.] To determine whether the trial court should, in sustaining the demurrer, have granted the plaintiff leave to amend, we consider whether on the pleaded and noticeable facts there is a reasonable possibility of an amendment that would cure the complaint's legal defect or defects." (Yvanova, supra, 62 Cal.4th at p. 924, fn. omitted.) The plaintiff has the burden of demonstrating there is a reasonable possibility the defect can be cured by amendment, and that the trial court abused its discretion in finding otherwise. (Blank v. Kirwan (1985) 39 Cal.3d 311, 318 (Blank).)
2. Claim Preclusion and Issue Preclusion
"The law of preclusion helps to ensure that a dispute resolved in one case is not relitigated in a later case." (Samara, supra, 5 Cal.5th at p. 326.) As noted ante, we refer to" 'claim preclusion'" in lieu of the often-used umbrella term of" 'res judicata, '" and use" 'issue preclusion'" in place of" 'collateral estoppel.'" (Ibid.) The doctrines, though related, have different requirements and consequences. (Ibid.)
Claim preclusion prevents relitigation of the same cause of action in a second suit between the same parties. (Mycogen Corp. v. Monsanto Co. (2002) 28 Cal.4th 888, 896 (Mycogen).) It applies "when 'a second suit involves (1) the same cause of action (2) between the same parties [or their privies] (3) after a final judgment on the merits in the first suit.'" (Samara, supra, 5 Cal.5th at p. 327.) Claim preclusion is based upon the primary rights theory, which defines the scope of a cause of action (id. at pp. 326-327) and bars a party from bringing a second or multiple suits "if both suits seek to vindicate the same primary right." (Mycogen, at p. 904.)
To determine the nature of the primary right affected, we look to" 'the plaintiff's right to be free from the particular injury suffered.'" (Mycogen, supra, 28 Cal.4th at p. 904.) Claim preclusion requires that "all claims based on the same cause of action must be decided in a single suit; if not brought initially, they may not be raised at a later date." (Id. at p. 897.) Applying the doctrine in a clear and predictable manner promotes judicial economy for "both the parties and the courts because it 'seeks to curtail multiple litigation causing vexation and expense to the parties and wasted effort and expense in judicial administration.'" (Ibid., italics omitted) "If claim preclusion is established, it operates to bar relitigation of the claim altogether." (DKN Holdings, supra, 61 Cal.4th at p. 824.)
Issue preclusion, by contrast, prevents the relitigation of issues argued and decided in a previous case, even if the second suit raises different causes of action. (Samara, supra, 5 Cal.5th at p. 327; accord DKN Holdings, supra, 61 Cal.4th at p. 824.) "Under issue preclusion, the prior judgment conclusively resolves an issue actually litigated and determined in the first action." (DKN Holdings, at p. 824.) It may only be invoked against a party who is bound by the prior proceeding. (Id. at p. 825.) Issue preclusion applies "(1) after final adjudication (2) of an identical issue (3) actually litigated and necessarily decided in the first suit and (4) asserted against one who was a party in the first suit or one in privity with that party." (Ibid.)
"It is well established that the claim preclusion aspect of the doctrine of res judicata applies to small claims judgments." (Pitzen v. Superior Court (2004) 120 Cal.App.4th 1374, 1381 (Pitzen).) Furthermore, the doctrine of issue preclusion will bar a small claims plaintiff from "relitigating the same issue in superior court where the record is sufficiently clear to determine that the issue was litigated and decided against plaintiff in the small claims action." (Bailey v. Brewer (2011) 197 Cal.App.4th 781, 791; see also Pitzen, at pp. 1384-1385.)
Bearing these principles in mind, we consider Arakji's contentions on appeal.
B. Analysis
1. The Prior Judgment Bars Arakji's FEHA Claim
Arakji contends that claim preclusion does not apply because (1) he has not reasserted the causes of action from the small claims lawsuit in the unlimited civil action, (2) the wrongful acts which formed the basis of his small claims lawsuit are distinct from the wrongful acts he alleges in the instant civil action, and (3) joinder of causes of action is permissive, not mandatory. He also maintains that issue preclusion does not apply because the issues raised in his small claims lawsuit are not identical to those asserted in the unlimited civil action. In support of his arguments, Arakji notes that "[r]es judicata was never intended to be used as a vehicle for forever 'immunizing' any party in a continuing business relationship from liability for continuous or recurrent breaches of contract, conspiracy directed toward such breaches, or for continuous or recurrent tortious misconduct." (Nakash v. Superior Court (1987) 196 Cal.App.3d 59, 69 (Nakash).)
These arguments, however, fail to recognize that Arakji's claims in both the small claims lawsuit and the unlimited civil action arise from Goodwill's alleged violation- through various wrongful acts-of Arakji's rights, under FEHA, to be free from discrimination and harassment at work based on his religious creed and other protected characteristics. As we explain, while asserting multiple "causes of action" in the small claims lawsuit and the civil action, Arakji in fact asserts the invasion of the same two distinct primary rights in each action. In both suits, Arakji asserts the right to be free from unlawful discrimination in his employment and the right to be free from harassment in his employment. Moreover, because all of the alleged wrongdoing occurred before the filing of the first action (the small claims lawsuit), Arakji is unable to avoid the preclusive effect of the prior judgment on the causes of action asserted here.
While Arakji correctly notes that joinder of separate causes of action is permissive (see Code Civ. Proc., § 427.10, subd. (a); Sawyer v. First City Financial Corp. (1981) 124 Cal.App.3d 390, 398-399 (Sawyer)), this policy does not apply to a single cause of action arising from the violation of a single primary right." 'A pleading that states the violation of one primary right in two causes of action contravenes the rule against "splitting" a cause of action.'" (Grisham v. Philip Morris U.S.A., Inc. (2007) 40 Cal.4th 623, 641 (Grisham).) Thus, "a single cause of action cannot be split and made the subject of several suits." (Sawyer, at p. 398.) So too, where there are two causes of action based on two primary rights (as we describe below) asserted in the first action and repeated in the second action, permissive joinder principles do not shield the later-asserted claims from preclusion.
Turning to those claims in the complaint in the civil action and in the prior small claims lawsuit, Arakji states that the right asserted in his small claims lawsuit was the "right to be free from discriminatory harassment" and contends that only the third cause of action in the instant civil action is based on the same right to be free of discriminatory harassment. He describes the wrongful acts he alleges Goodwill perpetrated against him in 2017 and 2018 and contends that the violations committed by his supervisor Andrea in 2018 are distinct from those committed by Bebe and Sonia in 2017.
We agree that, insofar as Arakji alleges both discrimination and harassment in his employment by Goodwill, he raises distinct claims. But by focusing on each, arguably distinct wrongful act giving rise to the claims, Arakji glosses over the key inquiry related to the primary right at issue. It is Arakji's" 'right to be free from the particular injury suffered'" (Mycogen, supra, 28 Cal.4th at p. 904)-not how that right was allegedly violated-which defines the scope of a cause of action for purposes of ascertaining claim preclusion. (Samara, supra, 5 Cal.5th at pp. 326-327.) To determine the nature of the primary right affected, we look to" 'the plaintiff's right to be free from the particular injury suffered'" (Mycogen, at p. 904) and examine Arakji's asserted causes of action through that lens.
The primary right implicates a" 'corresponding "primary duty" of the defendant, and a wrongful act by the defendant constituting a breach of that duty.'" (Mycogen, supra, 28 Cal.4th at p. 904.) Whereas the plaintiff's" 'right to be free from the particular injury suffered'" is indivisible (ibid.), a defendant's breach of the corresponding duty may logically take the form of more than one "wrongful act." (Ibid.) Indeed, the plaintiff's right to be free from the particular injury suffered must be distinguished both from the legal theory on which liability for that injury is premised and from the remedy sought. (Ibid.)
Our independent review of the pleadings in this action and in the prior, small claims lawsuit reveals that each of the asserted causes of action is derived from one of two distinct primary rights: Arakji's right to be free from unlawful discrimination in his employment due to his religious creed, national origin, ancestry, and disability (§ 12940, subd. (a)), and Arakji's right to be free from harassment due to his religious creed, national origin, ancestry, and disability (§ 12940, subd. (j)(1)).
Specifically, taking Arakji's allegations as true for the purposes of review on appeal from the sustaining of a demurrer, we note the allegation in the small claims lawsuit based on Andrea continuing to point the fan at Arakji arguably describes an injury based on "[h]arassment of an employee" (§ 12940, subd. (j)(1)), as does the third "cause of action" in the civil action, where he alleged Goodwill "purposefully intended to harass" him by pressuring him to move faster when transferring clothes to the rack.
By contrast, the allegation in the small claims lawsuit that Andrea "threatened to testify falsely" against Arakji, insinuating she could cause him to lose his position or be reprimanded due to her alleged dislike of his protected characteristics, arguably describes an injury based on discrimination under section 12940, subdivision (a)-whether in threatening to discharge from employment or in discriminating in the conditions or privileges of employment. Although Arakji has expressed the other four "causes of action" in the civil action as a series of distinct wrongful acts based on different legal theories (i.e., "[d]enial of employment due to religious creed, national origin, ancestry, and disability," "[l]imitation and segregation in employment due to religious creed, national origin, ancestry, and disability," and improper "inquiries as to the nature or severity of a disability," that does not alter the nature of those claims, which fundamentally describe different manifestations of on-the-job discrimination. Simply put, apart from Arakji's harassment claim, the "causes of action" asserted in the civil action allege a violation of a single primary right to be free from discrimination in employment under section 12940, subdivision (a). This is the same primary right asserted in Arakji's original small claims lawsuit.
The California Supreme Court's decision in Bay Cities Paving & Grading, Inc. v. Lawyers' Mutual Ins. Co. (1993) 5 Cal.4th 854 (Bay Cities) is illustrative. In Bay Cities, the attorney for a general contractor recorded a mechanics lien for his client but negligently failed both to serve a stop notice on the lenders and to file a complaint to foreclose the lien. (Id. at p. 858.) To determine whether the attorney's two omissions constituted a single "claim" under the applicable insurance policy, the high court looked to the primary right theory. (Id. at p. 860.) The court rejected the premise that the contractor had asserted two causes of action (one for each act of legal malpractice) and reiterated that under the primary right theory," 'the invasion of one primary right gives rise to a single cause of action.'" (Ibid.) As applied to the contractor's claim, the court explained that the contractor "had one primary right-the right to be free of negligence by its attorney in connection with the particular debt collection for which he was retained. [The attorney] allegedly breached that right in two ways, but it nevertheless remained a single right." (Ibid.)
Here, in the unlimited civil action, the causes of action asserted in the complaint (excluding the third cause of action based on harassment) each allege a violation of the same primary right, albeit relying in each instance on distinct underlying acts which according to the complaint occurred between April 25, 2017, and October 24, 2017. Like the primary right of the contractor in Bay Cities to be free of negligence by its attorney in connection with the debt collection retainer, Arakji seeks to protect his primary right under section 12940, subdivision (a) to be free from discrimination in his hiring and employment by Goodwill due to religious creed, national origin, ancestry, and disability. Goodwill "allegedly breached that right in [multiple] ways, but it nevertheless remained a single right." (Bay Cities, supra, 5 Cal.4th at p. 860.)
"Regardless of the number of legal theories which the complaint states, if there is but one injury to a primary right, only one cause of action arises." (Lippert v. Bailey (1966) 241 Cal.App.2d 376, 382.) Thus, a plaintiff's "somewhat greater factual elaboration of the same injury" in a second suit (Grisham, supra, 40 Cal.4th at p. 642) still requires examination for claim preclusion. "If a primary right is so split, determination of the issues in the first suit will be res judicata to the attempt to relitigate them in the second suit." (Sawyer, supra, 124 Cal.App.3d at p. 398.)
What is more, because the wrongful acts alleged in the small claims lawsuit occurred later in time than the acts alleged in support of the unlimited civil action, and all of the alleged wrongdoing by Goodwill occurred before the filing of the small claims lawsuit, Arakji needed to assert the facts supporting his later-filed causes of action for discrimination and harassment under section 12940 in the first suit in which he asserted those claims. (Mycogen, supra, 28 Cal.4th at p. 897.) As the trial court noted in ruling on the demurrer, assuming for purposes of demurrer that all factual allegations in both lawsuits are true (Yvanova, supra, 62 Cal.4th at p. 924), Arakji "necessarily had to know of the alleged discrimination the current lawsuit is based on when he brought his small claims action."
The timing of Arakji's small claims lawsuit and subsequent, unlimited civil action in relation to the wrongful acts alleged distinguishes this case from Nakash, upon which Arakji relies. In Nakash, the court held that the judgment from an earlier, federal lawsuit between the parties to rescind a stock purchase transaction did not bar the plaintiffs from seeking rescission in a second lawsuit. (Nakash, supra, 196 Cal.App.3d at pp. 69-70.) In drawing this conclusion, the court examined the scope of the allegations in both actions and noted not only that the stock purchase agreement "may produce more than one primary right" (id. at p. 70) but "[t]he transactional nucleus of facts which generated the second complaint occurred after the first judgment." (Ibid.)
By contrast, the acts Arakji asserted in the unlimited civil action allegedly occurred prior to the filing of the small claims lawsuit, not afterward. Because Arakji ignores this critical distinction, his reliance on Nakash for the proposition that a prior judgment should not bar future inquiry into misconduct averred in a later action is misplaced. Indeed,"' "[i]f the matter was within the scope of the [earlier] action, related to the subject matter and relevant to the issues, so that it could have been raised, the judgment is conclusive on it despite the fact that it was not in fact expressly pleaded or otherwise urged. . . . Hence the rule is that the prior judgment is res judicata on matters which were raised or could have been raised, on matters litigated or litigable." '" (Amin v. Khazindar (2003) 112 Cal.App.4th 582, 589-590 (Amin); accord Villacres v. ABM Industries Inc. (2010) 189 Cal.App.4th 562, 576.)
In sum, the small claims court's determination that Arakji lacked evidence to support his cause of action for Goodwill's alleged acts of unlawful discrimination and harassment in violation of section 12940 constituted a final judgment on the merits with potentially preclusive effect. Under the doctrine of claim preclusion, it established a bar to further litigation of the same causes of action. (Mycogen, supra, 28 Cal.4th at p. 897.)
Arakji subsequently filed this unlimited civil action alleging different acts of discrimination and harassment by Goodwill during the period of time preceding Arakji's small claims lawsuit, in violation of the same primary rights under section 12940. Claim preclusion" 'precludes piecemeal litigation by splitting a single cause of action or relitigation of the same cause of action on a different legal theory or for different relief.'" (Weikel v. TCW Realty Fund II Holding Co. (1997) 55 Cal.App.4th 1234, 1245.) This action involves" '(1) the same cause[s] of action (2) between the same parties . . . (3) after a final judgment on the merits in the first suit.'" (Samara, supra, 5 Cal.5th at p. 327.) Therefore, the doctrine of claim preclusion applies.
For these reasons, the trial court correctly determined that the preclusive effect of the small claims judgment bars the causes of action asserted in this action.
Having reached this conclusion, it is unnecessary to reach the secondary question of whether issue preclusion bars relitigation of issues that were litigated in the prior proceeding. (DKN Holdings, supra, 61 Cal.4th at p. 824 [noting that unlike claim preclusion, "issue preclusion does not bar entire causes of action" but instead "prevents relitigation of previously decided issues"].)
2. Public Policy Supports Application of the Law of Preclusion
Before making a final determination that the doctrine of claim preclusion bars Arakji's suit here, we must also consider the public policies that underlie the doctrine. (Ronald F. v. State Dept. of Developmental Services (2017) 8 Cal.App.5th 84, 93; see Lucido v. Superior Court (1990) 51 Cal.3d 335, 342-343.)
On one hand, the law of preclusion "rests upon the sound public policy that there must be an end of litigation and accordingly, persons who have had one fair trial on an issue may not again have it adjudicated." (Dillard v. McKnight (1949) 34 Cal.2d 209, 214.) Yet we also recognize that the finality accorded to a claim or issue by way of preclusion "should [not] be embraced reflexively, nor attached to every decision rendered. 'The "chance" to litigate is not simply some unspecified opportunity for disputation over legal rights; it is the opportunity to submit a dispute over legal rights to a tribunal legally empowered to decide it according to definite procedural rules.'" (Samara, supra, 5 Cal.5th at p. 332.)
In this matter, the trial court's order sustaining Goodwill's demurrer based on claim preclusion does not undermine the policies underlying the doctrine. During his employment with Goodwill, Arakji elected to bring a small claims action, alleging discrimination and harassment in violation of section 12940 by a supervisor because of Arakji's religious creed, national origin, ancestry, and disability. After the small claims court ruled there was insufficient evidence to support Arakji's claims, he filed what were effectively the same claims in this civil action and alleged additional facts that he could have presented in his initial small claims suit. "The doctrine of res judicata or claim preclusion dictates that in ordinary circumstances a final judgment on the merits prevents litigation of the same cause of action in a second suit between the same parties." (F.E.V. v. City of Anaheim (2017) 15 Cal.App.5th 462, 465 (F.E.V.).) It is only in "rare circumstances" when applying claim preclusion "would result in manifest injustice" that a court may deny a final judgment claim preclusive effect. (Ibid.)
"' "A party cannot by negligence or design withhold issues and litigate them in consecutive actions." '" (Amin, supra, 112 Cal.App.4th at p. 590.) As Arakji had the opportunity to litigate his discrimination and harassment claims before the small claims court, his failure to assert all the factual allegations at his disposal may not be remedied by allowing him a second opportunity to litigate that claim. Goodwill is entitled to rely on the finality of the prior judgment with respect to Arakji's claim against it for violation of section 12940. Arakji" 'should not be permitted to litigate [the claim] again to the harassment and vexation of his opponent. Public policy and the interest of litigants alike require that there be an end to litigation.'" (F.E.V., supra, 15 Cal.App.5th at p. 475.) We decide that considerations of public policy do not bar application of the doctrine of claim preclusion here.
3. Amendment
We lastly consider whether the trial court erred in denying Arakji leave to amend. We look to the pleaded and noticeable facts and decide whether there "is a reasonable possibility of an amendment that would cure the complaint's legal defect or defects." (Yvanova, supra, 62 Cal.4th at p. 924.) It is the plaintiff's burden to demonstrate "there is a reasonable possibility that the defect can be cured by amendment," and that the trial court abused its discretion in finding otherwise. (Blank, supra, 39 Cal.3d at p. 318.)
The trial court explained that it perceived no way for Arakji to allege FEHA violations against Goodwill "premised on discrimination and harassment due to religious creed, national origin, ancestry, and disability during his employment . . . that would not be subject to the res judicata/collateral estoppel effect" of the small claims judgment. On appeal, Arakji does not address the possibility of amending the complaint or propose how he might assert a section 12490 violation under FEHA for Goodwill's alleged acts of discrimination and harassment during his employment that would not arise from the same primary rights previously litigated in his small claims action. Since Arakji has not carried his burden to demonstrate how amending the complaint might avert the preclusive application of the prior judgment, we conclude the trial court did not abuse its discretion in sustaining the demurrer without leave to amend.
III. DISPOSITION
The judgment is affirmed. In the interests of justice, the parties shall bear their own costs on appeal. (Cal. Rules of Court, rule 8.278(a)(5).)
WE CONCUR: Bamattre-Manoukian, Acting P.J. Wilson, J.