Opinion
H045287
04-29-2020
PAMELA DESMOND, Plaintiff and Appellant, v. SALINAS VALLEY MEMORIAL HEALTH CARE SYSTEM, Defendant and Respondent.
NOT TO BE PUBLISHED IN OFFICIAL REPORTS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 This opinion has not been certified for publication or ordered published for purposes of rule 8.1115. (Monterey County Super. Ct. No. 15CV000675)
Pamela Desmond sued her former employer, defendant Salinas Valley Memorial Healthcare System (the hospital), for retaliation and defamation after the hospital terminated her employment. Desmond, a registered nurse, claims that the hospital ignored and tried to cover up the outbreak of a skin infection among nurses and patients, then unlawfully retaliated against her for reporting the outbreak. The hospital maintains that Desmond's termination was not because of her protected complaints, but because she violated patient privacy policies by going to a skilled nursing facility to check on a discharged, former patient who she believed was the source of the infection.
On appeal from the trial court's grant of summary judgment in favor of the hospital, Desmond contends that there are triable issues of fact concerning the hospital's (1) retaliatory intent or animus in investigating the purported privacy violation and terminating Desmond's employment, and (2) publication of defamatory statements. As set forth below, we find no triable issues of material fact and affirm the judgment.
I. FACTUAL AND PROCEDURAL BACKGROUND
A. Desmond's Complaint
In December 2015, Desmond filed a complaint against the hospital, asserting causes of action for retaliation and defamation. The complaint alleged that in November 2014, Desmond began caring for an oncology patient referred to in this litigation as M.S. M.S. was bedridden and suffered from multiple health issues, one of which was an itchy, thick rash that covered her body and flaked onto the bedding and floor. M.S. could not speak English and rarely had visitors. Desmond communicated in Spanish with M.S. and "formed a deep nurse-patient bond" with her.
Desmond developed an itchy rash on about December 15, 2014. She learned in January 2015 that several other nurses on the oncology floor had contracted similar conditions. Around January 16, 2015, Desmond tried to tell her supervisor about the spate of rashes, but was rebuffed. Desmond consulted with a dermatologist a few days later who diagnosed her with scabies. The dermatologist informed Desmond about a more severe, highly contagious form that scabies can take if untreated in people with weakened immune systems; he showed her a picture that closely resembled the rash that she had observed on M.S.
Based on this information, Desmond believed that M.S.'s undiagnosed skin infection was the highly contagious, progressed form of scabies. She contacted the hospital's employee health department and was directed to infectious disease control officer, Debra Johnson. Desmond reported her concern to Johnson that M.S. had been discharged from the hospital without diagnosis or treatment for the skin condition. Desmond later went to a nearby skilled nursing facility and entered as a visitor to check on M.S.'s welfare. When Desmond told Johnson about her visit to the skilled nursing facility, Johnson stated that visiting the former patient was inappropriate and a violation of the Health Insurance Portability and Accountability Act (HIPAA). Johnson repeated the allegation that Desmond had committed a HIPAA violation to managers, hospital staff, and work supervisors throughout January and February 2015.
At a meeting on January 23, 2015, members of the hospital's human resources team told Desmond that she had violated HIPAA by using protected health information in connection with her visit with M.S. Desmond believed that she was being falsely accused of privacy violations because the hospital was concerned about receiving bad publicity from a reported scabies outbreak. Desmond immediately began suffering from severe emotional distress and anxiety about the allegations against her and took stress leave from work.
The hospital terminated Desmond's employment sometime after these meetings, and after she participated in the hospital's internal grievance process. Desmond asserted three different causes of action for retaliation, claiming violations of Labor Code sections 1102.5, subdivision (b) and 6310 (offering protection to whistleblowers for making a health or safety complaint about working conditions against a government employer) as well as Health and Safety Code section 1278.5 (offering protection to whistleblowers in healthcare facilities). Desmond asserted a fourth cause of action for defamation, claiming that the hospital's statements that Desmond had violated HIPAA, improperly accessed and used protected health information, and violated standards of professional nursing, were false and were published with reckless disregard of any substantiated fact and in abuse of any alleged privilege.
B. The Hospital's Answer and Motion for Summary Judgment
The hospital filed an answer to Desmond's complaint, denying all allegations and asserting numerous affirmative defenses. The hospital also moved for summary judgment. In its motion, the hospital argued that Desmond's retaliation claims under Health and Safety Code section 1278.5 and Labor Code sections 1102.5 and 6310 failed because she could not demonstrate a link between her protected activity and the hospital's decision to terminate her employment, and because the hospital had legitimate, nonretaliatory reasons for the termination. The hospital argued that Desmond's defamation claim also failed because the allegedly defamatory statements were true and were protected by the common interest privilege.
The hospital asserted that it terminated Desmond's employment because she violated HIPAA and hospital policies by intentionally using protected health information in an unauthorized manner to locate a discharged patient and to obtain information about the former patient's medical condition. It explained that Desmond was one of three hospital employees who reported a suspected scabies outbreak to management on January 19, 2015. When the hospital learned that Desmond and one other coworker had been experiencing symptoms for weeks, it "sternly counseled" them for not reporting the problem sooner, then reported the suspected outbreak to the county health department and began investigating the source of the suspected outbreak.
The hospital claimed that after it informed Desmond that its investigation had not confirmed a patient source and that she might receive an " 'occurrence' " for any scabies-related absences, she went to a skilled nursing facility with her six-year-old son, located a discharged patient who she suspected was the patient source, and tried to determine whether the patient had been treated for scabies. Upon learning of Desmond's actions, the hospital investigated Desmond's visit to the skilled nursing facility and held an investigatory meeting to hear her side of the story. The hospital also spoke with legal counsel in the field of medical privacy laws to determine whether Desmond had violated HIPAA. The hospital concluded that her actions constituted a reportable HIPAA violation. The hospital reported the violation to the California Department of Public Health and the United States Department of Health and Human Services, and to the affected patient as required by law. The hospital terminated Desmond in April 2015, after the investigation and a Skelly hearing.
Hospital policy dictates that employees who have excessive occurrences, such as absenteeism, may be subject to discipline.
In Skelly v. State Personnel Board (1975) 15 Cal.3d 194, the California Supreme Court held that an agency contemplating disciplinary action against a public employee must accord the employee certain safeguards. "The Supreme Court's directive gave rise to an administrative procedure known as a Skelly hearing, in which an employee has the opportunity to respond to the charges upon which the proposed discipline is based." (Flippin v. Los Angeles City Bd. of Civil Service Commissioners (2007) 148 Cal.App.4th 272, 280.)
In its motion, the hospital attempted to discredit what it described as Desmond's unconvincing effort to cast herself as a whistleblower and victim of retaliation. The hospital maintained that the other employees who reported the suspected scabies outbreak were not subject to discipline. And it pointed out that Desmond only tried to report the suspected outbreak to the county the day after the hospital informed her that it was investigating her for a potential HIPAA violation, by which time the hospital itself had already reported the suspected outbreak.
C. Evidence Supporting the Hospital's Motion for Summary Judgment
The hospital hired Desmond in 2005 as a registered nurse in its comprehensive cancer center. She was assigned to care for medical surgical patients as well as cancer patients. Desmond had been employed by the hospital for over nine years when her position was terminated.
Desmond's position required her to abide by several hospital policies. She confirmed in her deposition testimony that she understood that she was required to report a rash that she thought was contagious as soon as possible, and before the end of the work shift, to the employee health department. She was aware of the hospital's policy prohibiting any form of retaliation against an employee who reports a perceived problem or concern.
Desmond also attested that she was familiar with HIPAA. At the time of her hire, she signed an agreement that personal patient medical information "only be used as needed" to perform the employee's hospital-assigned duties. Desmond also was familiar with the rule stating that use and disclosure of protected health information that is not on a " 'need to know' " basis to perform job duties is a HIPAA privacy breach. Desmond understood that she was to use confidential information only to provide patient care or to conduct hospital duties.
On January 19, 2015, Desmond reported to employee health services that she and at least one other hospital employee had rashes they believed were scabies. Johnson, the hospital's director of infection prevention and control, met immediately with the reporting employees. According to Johnson's declaration submitted in support of the hospital's motion for summary judgment, Desmond and another employee told her that they had been experiencing rashes for several weeks and believed they had contracted the condition from a former patient. Johnson told them that they should have reported their concerns sooner and should not have waited. She directed them to see a doctor for diagnosis and treatment. Regarding the former patient, Johnson reviewed M.S.'s medical chart with the hospital's chief medical officer, who is board certified in infectious diseases, and concluded that M.S. was not the source of the employees' rashes.
On January 20, 2015, Desmond informed employee health services by phone that she had been diagnosed with scabies. Johnson notified the Monterey County Health Department that day of a scabies outbreak at the hospital. She prepared a memorandum for hospital employees, medical staff, and volunteers about symptoms and management, which was circulated around January 26, 2015.
Desmond remained concerned about what would happen to M.S. even after she was told that the hospital had determined M.S. was not the source of the outbreak. Desmond disagreed with that determination and suspected that M.S. was the source of her condition. According to Johnson's declaration, she called Desmond on January 21, 2015, to follow up on a voicemail that Desmond had left for her. Desmond told Johnson that she had gone to see M.S. at a nearby skilled nursing facility to see whether she had been treated. Johnson asked if Desmond and M.S. were friends, and Desmond responded " 'she is now.' " Desmond recounted the conversation differently, recalling that she told Johnson that M.S. looked much better and had been given a cream for treatment. Desmond testified that she did not call M.S. her friend, but rather said that she " 'care[d] for her as a friend.' "
During the conversation, Johnson became concerned that Desmond had committed a privacy violation. She notified the hospital's privacy officer, Shereen Martin, and the chief nursing officer, Christie Gonder, of her concern. Gonder directed Johnson to contact the skilled nursing facility to investigate what had occurred during Desmond's visit.
On January 22, 2015, Johnson contacted the skilled nursing facility and spoke with vocational nurse and director of staff development, Kristine Lacanilao. Lacanilao submitted a declaration in support of the hospital's motion stating that upon receiving Johnson's call, she spoke with the patient about whether a nurse from the hospital had visited her the previous day. A skilled nursing facility employee who spoke Spanish translated for Lacanilao. M.S. told Lacanilao that a nurse had visited her on January 21, 2015. Though the nurse looked familiar, M.S. did know her and initially thought that she was a new nurse at the nursing facility, except that she had her son with her. Lacanilao attested that the patient said the nurse had asked whether she had been treated for scabies, as some of the nurses at the hospital had been treated for scabies and wanted to make sure that she was treated. M.S. was upset and worried that she had made someone ill.
Martin, the privacy officer, attested in her declaration that she was responsible for overseeing hospital policies and procedures related to patient health information privacy. After receiving Johnson's January 21, 2015 message about the possible privacy breach, Martin discussed with several other managers whether the actions reported by Johnson constituted a HIPAA violation. She also met with the senior administrative director of human resources and the senior administrative director of patient care services, Trini Juarez, to review Desmond's case.
Martin and Juarez, together with the hospital's head of human resources and Desmond's nursing supervisor, medical surgical clinical manager Meghan Kelly, held an investigatory meeting on January 23, 2015 (hereafter the "January 23 investigatory meeting"), to give Desmond the opportunity to explain her visit with M.S. Desmond attended the meeting accompanied by two union representatives. After considering Desmond's explanation, as well as Johnson's summary of her conversation with Lacanilao, Martin believed that Desmond's conduct likely violated HIPAA and breached hospital privacy policies. Martin contacted outside counsel, Allan Jergesen, a partner in the law firm of Hanson Bridgett LLP, for a second opinion about the possible privacy violation.
Jergesen regularly advises clients on compliance with federal and state health privacy laws. He attested that his understanding, derived from his conversation with Martin, was that a hospital employee visited a discharged patient and informed her that she was the suspected source of the skin infection. Jergesen conveyed to Martin that in his opinion, the nurse had violated HIPAA and California law by improperly using the patient's protected health information in a non-job function. A few days later, Jergesen sent Martin an e-mail in which he revised his analysis to explain that a more accurate description of the likely HIPAA violation was of an improper disclosure of protected health information in a non-job function, rather than improper use.
It appears that the Jergesen declaration inadvertently omitted a word from paragraph 5 describing Desmond's alleged visit to the skilled nursing facility. It states that she "informed the patient that the patient was the suspected source of the skin infection." (Italics added.) But in the legal opinion that Jergesen provided Martin during the hospital's investigation, his e-mail states his understanding that Desmond "then visited the patient in the skilled nursing facility and informed her that she was not the source of the outbreak." (Italics added.)
Desmond took medical leave because of stress caused by the January 23 investigatory meeting. On January 24, 2015, she tried to report the suspected scabies outbreak externally by contacting the county health department. She also sent an e-mail to the Division of Occupational Safety and Health (Cal/OSHA) stating that she felt the hospital was trying to discipline her for trying to help her patients and coworkers by reporting the patient who she suspected gave them scabies.
The hospital concluded its internal investigation while Desmond was on leave.
Juarez, the senior administrative director of patient care services, declared in his declaration in support of the hospital's motion for summary judgment that after considering Desmond's testimony at the January 23 investigatory meeting and the information gathered by Johnson, he made the following findings: (1) Desmond was the nurse who had visited M.S. at the skilled nursing facility; (2) at the time of the visit, M.S. did not know Desmond's name and was not able to identify her; (3) Desmond's visit to see the former patient was an improper use of protected health information which Desmond received while performing her duties at the hospital; and (4) Desmond's visit to discuss M.S.'s medical condition occurred outside the scope of her job duties, was a breach of the patient's reasonable expectation of privacy, and violated the hospital's HIPAA-related policies. On January 28, 2015, Juarez sent Desmond a letter summarizing the hospital's findings and informing her that the proposed discipline was termination of her employment (hereafter "January 28 notice of intended discipline").
Martin also performed her own HIPAA analysis, contacted outside counsel again, and spoke with the state department of public health. The department confirmed that the actions described constituted a violation of HIPAA and a reportable privacy breach. The hospital thereafter sent obligatory notice to the department and to M.S. reporting a privacy breach.
When Desmond returned from leave, the hospital held a Skelly hearing. Desmond presented a statement in her defense to address the concerns raised in the January 28 notice of intended discipline. The hospital upheld its determination. Juarez declared that after "thoughtful review of the testimony presented by" Desmond and her union representatives, he determined that Desmond had violated HIPAA and related policies by knowingly visiting the former patient to evaluate her medical condition in an attempt to confirm suspicions that she was the source of the scabies outbreak. The hospital issued Desmond a letter terminating her employment on April 14, 2015. Desmond grieved her termination through her union. After a second hearing, the grievance was denied.
Martin and Juarez each declared that they communicated the reasons for her termination only to employees of the hospital who supervised Desmond or were involved in the investigation of her conduct and in the grievance proceedings. Martin attested that she did not disclose Desmond's identity when reporting the privacy violation to the relevant state and federal agencies. The hospital's senior administrative director of human resources, Michelle Childs, also submitted a declaration in support of the motion for summary judgment. Childs declared that the hospital had not disclosed the reason for plaintiff's termination to any of her prospective employers; rather, the hospital's policy is to provide only the dates of employment and position held.
D. Desmond's Opposition to the Motion for Summary Judgment
In opposition to the motion, Desmond claimed that the hospital had omitted and mischaracterized facts which showed that the proffered reason for her termination was pretextual. She contended that rather than take steps to address the potential scabies outbreak, the hospital falsely accused her of violating HIPAA, conducted a sham investigation motivated by fear of bad publicity, and ultimately terminated her employment in retaliation for her protected complaints.
Desmond disputed numerous facts in the hospital's separate statement and provided additional facts. She submitted evidentiary support including her deposition testimony and declaration, declarations of two of her former colleagues—registered nurse, Sandra Ruiz, and certified nurse's assistant, Sandy Jackson, and additional documentary evidence.
Desmond attested that she first reported that she and other employees on the floor had a rash to her supervisor, Meghan Kelly, on January 16, 2015. Kelly responded as if she did not want to hear about it and then failed to take any action. When Desmond reported the rashes to employee health services a few days later, Johnson came to the oncology ward and met with Desmond, Kelly, and two other nurses. Johnson appeared irritated and upset. She told them they should have come forward sooner. Desmond and Jackson both declared that until that day, they did not know that the hospital had a dedicated position for infection prevention and control.
Desmond vehemently disputed the hospital's representation of her visit with M.S. at the skilled nursing facility. She denied seeking out M.S. because she was afraid that she would get an occurrence for missing work and wanted a patient diagnosis for the scabies outbreak. She disputed the hospital's assertion that it informed her on January 20, 2015, that M.S. was determined not to be the source of the scabies outbreak, noting that Johnson testified at deposition that the hospital never identified any patient source of the scabies infections. And she asserted that contrary to Johnson's purported findings about the visit with M.S., Desmond never discussed scabies or asked whether M.S. had been treated for scabies. Desmond insisted that her visit was solely out of concern for M.S. She pointed to evidence that on several occasions she had asked the emergency health nurses, as well as Johnson, if they were going to follow up with M.S. because she was concerned that she might still be suffering.
Desmond declared that she decided to locate M.S. because she was concerned that M.S. had scabies, had received inadequate treatment at the hospital, and remained undiagnosed. Desmond emphasized that she did not access medical records or use protected health information to locate M.S., as was later confirmed by the hospital during its investigation. Instead, Desmond's familiarity with M.S.'s condition and family circumstances allowed her to deduce that she may have been released to a nearby skilled nursing facility. Desmond went to the facility, walked in as a visitor, and asked the on-duty nurse for M.S. by name.
According to Desmond's declaration and deposition testimony, she spoke with M.S. from the doorway. Her six-year-old son, who was home that day for his prophylactic scabies treatment, was with her. M.S. remembered Desmond and invited her in. Desmond took only one step forward because she saw that the patient was in isolation. Desmond remarked that M.S. looked better. M.S. said that she felt better but still got very itchy at night. She said that she was supposed to be checked for bugs but it had not been done. Desmond asked if M.S. needed anything, and the patient responded that she was okay.
Desmond attested that she never mentioned scabies to M.S. She told the nurse at the nursing station, however, that M.S. complained about being itchy and that some nurses at the hospital had been treated for scabies. She asked whether M.S. had been diagnosed or treated for scabies. The nurse did not know but said she would check. Desmond called back and learned that M.S. had not been treated for scabies.
Later that afternoon, Johnson returned Desmond's phone call. Desmond again asked about M.S., and after being told to take care of herself and her family, told Johnson that she had visited M.S. at the skilled nursing facility. Johnson asked if they were friends, and Desmond explained that she had come to care for M.S. as a friend through her time at the hospital. Desmond claimed that she was not aware of any concern about HIPAA until Juarez directed her to attend a meeting the next day about a possible HIPAA violation.
Desmond's evidence is contradictory about whether Johnson alerted her during the phone call to a concern that she might have violated HIPAA. In her deposition testimony and declaration, Desmond stated that Johnson did not reprimand her or mention a HIPAA violation at that time. But in an e-mail statement to her union representative, dated April 13, 2015, Desmond stated that after telling Johnson that she found the patient at the skilled nursing facility and that the patient looked better but was still itchy, Johnson "loudly accused me of violating HIPAA rules for talking about this patient."
Desmond declared that at the January 23 investigatory meeting, Juarez accused her of violating HIPAA, of unlawfully using protected health information, and of blaming M.S. for spreading scabies to the hospital nurses. The accusations shocked and offended Desmond, who explained that she visited the skilled nursing facility because she was worried about M.S. and that she would never blame a patient for exposure to an illness. The meeting and threat to her career caused Desmond extreme distress, and she turned in paperwork to take medical leave.
Desmond asserted that the hospital's fear of a "PR disaster" motivated its retaliatory investigation and termination. She pointed to internal correspondence in which hospital management strategized to limit negative exposure by providing department heads with Johnson's "scripting" about the outbreak and by avoiding references in exposure notices to words like "scabies" and "confirmed."
Desmond produced evidence that Martin never informed the other decision makers about Jergesen's e-mail clarifying his HIPAA analysis and changing his opinion of a violation from that of "improper use" to "improper disclosure." The hospital never provided Jergesen with Desmond's version of her visit with M.S.
She also produced evidence suggesting that the hospital tried to quash other scabies reports. Ruiz attested that she, too, had been diagnosed with scabies in January 2015. Ruiz told her employee health services nurse about the diagnosis and was told she could be terminated for showing up to work for over two weeks without reporting a rash. Another employee health services nurse later contacted Ruiz, directed her outside of the hospital, and brought her scabicide lotion in a brown paper bag instead of sending her to the hospital's pharmacy. Ruiz believed that the investigation into Desmond's conduct and alleged privacy breach was retaliation for her having reported the scabies outbreak.
Ruiz also declared that in March 2015, M.S. was readmitted to the hospital. The treating physician ordered a scabies test for her. After Ruiz entered the test into the computer system, she received a message from the lab that the test needed to be cleared with Johnson. Ruiz had to explain to Johnson that the doctor had ordered the test. She was subjected to a human resources inquiry about her conduct. Although she was not formally disciplined, there were repercussions, including that she no longer worked as a charge nurse, a position she had held with the hospital for 18 years.
Desmond also opposed the motion for summary judgment on the defamation cause of action. She argued that triable issues of fact existed in relation to the falsity of the hospital's statements about her visit with former patient M.S. and her alleged HIPAA and privacy policy violations, as well as whether the defamatory statements were made without malice and thus subject to the common interest privilege.
E. Objections to Evidence
Desmond objected to all instances of hearsay proffered by the hospital to prove the alleged HIPAA violation. She specifically objected to portions of the declarations of Childs, Gonder, Johnson, Juarez, Lacanilao, Martin, and Scholink, primarily on grounds of hearsay, as well as for lack of personal knowledge, speculation, or conclusory statements. She also objected to portions of the Jergesen declaration on grounds of hearsay and improper lay opinion, specifically his recitation of Martin's stated reasons for the hospital's investigation and request for his legal opinion. We discuss the objections to evidence in more detail post (part II.2.B.b.).
In reply, the hospital objected to specified portions of the evidence submitted by Desmond and challenged many of Desmond's additional facts as argument or speculative belief.
F. The Trial Court's Order Granting Summary Judgment for the Hospital
In a written order after hearing, the trial court overruled the parties' evidentiary objections and granted the motion for summary judgment. The court found that although Desmond had established a prima facie case of retaliation, the hospital had demonstrated a legitimate, nonretaliatory reason for the termination, following a reasonable investigation under the circumstances in accordance with Cotran v. Rollins Hudig Hall Internat., Inc. (1998) 17 Cal.4th 93, 95 (Cotran). The court determined that Desmond, in response, failed to demonstrate that the hospital's stated reason was pretextual. The court found that the temporal proximity between Desmond's patient and employee safety reports and the hospital's termination decision was insufficient evidence of pretext, in part because the hospital self-reported the outbreak to the health department before Desmond did, and because at least two other nurses who reported scabies were not fired. The court concluded that Desmond failed to carry her burden to demonstrate the hospital's legitimate, nonretaliatory reason was not pretextual, and consequently, failed to create a triable issue of material fact with respect to her defamation claim.
The court entered judgment in favor of the hospital on October 10, 2017. Desmond timely appealed from the judgment. The trial court thereafter entered an amended judgment, specifying the costs against Desmond.
Though neither party has raised the issue, we find the appeal is properly before us. The judgment entered on October 10, 2017, disposed of all legal issues between the parties and was a final judgment for purposes of taking the appeal. (Code Civ. Proc., §§ 577, 904.1, subd. (a); Griset v. Fair Political Practices Com. (2001) 25 Cal.4th 688, 698-699.) Because the "amended judgment" added only the costs of suit awarded to the hospital and otherwise made no changes to it, it did not materially change the judgment. (See Amwest Surety Ins. Co. v. Patriot Homes, Inc. (2005) 135 Cal.App.4th 82, 84, fn.1 [rejecting contention that appeal must be dismissed because it failed to appeal from a subsequent, modified judgment adding costs and attorney fees].) We may alternatively construe the appeal as a premature but valid appeal from the amended judgment. (Ibid.)
II. DISCUSSION
Desmond argues that the evidence created triable issues of material fact that precluded granting the hospital's motion for summary judgment. As we explain, we find no triable issue of material fact and conclude that summary judgment was proper as to both Desmond's employment retaliation and defamation causes of action.
A. Summary Judgment and Standard of Review
Summary judgment is appropriate when all the papers submitted show that there are no triable issues of material fact such "that the moving party is entitled to a judgment as a matter of law." (Code Civ. Proc., § 437c, subd. (c); Schachter v. Citigroup, Inc. (2009) 47 Cal.4th 610, 618 (Schachter).)
We review an order granting summary judgment de novo, applying the same three-step analysis as the trial court. (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 334 (Guz); Pipitone v. Williams (2016) 244 Cal.App.4th 1437, 1449.) First, we identify the causes of action framed by the pleadings. Next, we determine whether the moving party has satisfied its burden of showing the causes of action have no merit because one or more elements cannot be established, or that there is a complete defense to that cause of action. Last, if the moving party has made a prima facie showing that it is entitled to judgment as a matter of law, the burden of production shifts and we review whether the party opposing summary judgment has provided evidence of a triable issue of material fact as to the cause of action or a defense. (Code Civ. Proc., § 437c, subds. (o), (p)(2); Pipitone, supra, at p. 1449.)
A party opposing summary judgment may not "rely upon the allegations or denials of its pleadings" but must set forth "specific facts" beyond the pleadings to show the existence of a triable issue of material fact. (Code Civ. Proc., § 437c, subd. (p)(2).) A triable issue of fact exists if "the evidence would allow a reasonable trier of fact to find the underlying fact in favor of the party opposing the motion in accordance with the applicable standard of proof." (Aguilar v. Atlantic Richfield Co. (2001) 25 Cal.4th 826, 850 (Aguilar).) In making its determination, "the court may not weigh the plaintiff's evidence or inferences against the defendants' as though it were sitting as the trier of fact, [but] it must nevertheless determine what any evidence or inference could show or imply to a reasonable trier of fact." (Id. at p. 856.) The evidence must be viewed in the light most favorable to the nonmoving party. (Schachter, supra, 47 Cal.4th at p. 618.)
B. Desmond's Employment Retaliation Claims
Desmond challenges the summary judgment in favor of the hospital as to each of her retaliation causes of action: (1) violation of Labor Code section 1102.5; (2) violation of Labor Code section 6310; and (3) violation of Health and Safety Code section 1278.5.
Labor Code section 1102.5, subdivision (b), prohibits retaliation against an employee for disclosing a violation of state or federal law, or noncompliance with rules and regulations, to a government agency or to a person with authority over the employee. Labor Code section 6310, part of the California Occupational Safety and Health Act of 1973, prohibits retaliation against an employee for making a workplace safety complaint to government agencies or to the employee's employer or representative. And Health and Safety Code section 1278.5 provides whistleblower protections for health care workers who report suspected issues relating to the care, services, and conditions of a facility.
"An employer . . . shall not retaliate against an employee for disclosing information . . . to a government or law enforcement agency, to a person with authority over the employee or another employee who has the authority to investigate, discover, or correct the violation or noncompliance, or for providing information to, or testifying before, any public body conducting an investigation, hearing, or inquiry, if the employee has reasonable cause to believe that the information discloses a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation, regardless of whether disclosing the information is part of the employee's job duties." (Lab. Code, § 1102.5, subd. (b).)
"No person shall discharge or in any manner discriminate against any employee because the employee has done any of the following: (1) Made any oral or written complaint to [Cal/OSHA], other governmental agencies having statutory responsibility for or assisting the division with reference to employee safety or health, his or her employer, or his or her representative. . . . [¶] . . . (4) Reported a work-related . . . injury, or illness . . . ." (Lab. Code, § 6310, subd. (a)(1), (4).)
Health and Safety Code section 1278.5 expresses the Legislature's determination that state public policy is to encourage patients, nurses, members of the medical staff, and other healthcare workers to notify government entities of "suspected unsafe patient care and conditions." (Health & Saf. Code, § 1278.5, subd. (a).) The statute prohibits, as relevant here, discrimination or retaliation against a health facility worker for making a complaint or report to an employer or a government agency. (Id., subd. (b)(1)(A).)
On appeal, Desmond contends that she proffered evidence sufficient to establish a prima facie case for retaliation under each of these statutory violations, demonstrating the hospital's stated reasons were pretextual and revealing that her termination was motivated by retaliatory animus. The hospital does not dispute Desmond's prima facie case in its responsive briefing but contends that she failed to oppose the summary judgment with substantial evidence that the hospital's proffered reason was pretextual so as to support a reasonable inference that her discharge was motivated by animus.
The parties agree on the applicable legal framework set forth below.
1. The McDonnell Douglas Framework
In cases alleging employment discrimination or retaliation, we analyze the trial court's decision on a motion for summary judgment using the burden-shifting framework established by the United States Supreme Court in McDonnell Douglas Corp. v. Green (1973) 411 U.S. 792. (Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 860 (Serri).) The three-step test described in McDonnell Douglas "reflects the principle that direct evidence of intentional discrimination [or retaliation] is rare, and that such claims must usually be proved circumstantially. Thus, by successive steps of increasingly narrow focus, the test allows discrimination [or retaliation] to be inferred from facts that create a reasonable likelihood of bias and are not satisfactorily explained." (Guz, supra, 24 Cal.4th at p. 354.)
California courts often cite federal authorities in analyzing state employment discrimination or retaliation claims. (See Guz, supra, 24 Cal.4th at p. 354 ["Because of the similarity between state and federal employment discrimination laws, California courts look to pertinent federal precedent when applying our own statutes."].)
Under the first step of the McDonnell Douglas framework, the plaintiff bears the initial burden to present a prima facie case of discrimination or retaliation. This prima facie burden is not onerous but requires that the employee "at least show ' "actions taken by the employer from which one can infer, if such actions remain unexplained, that it is more likely than not that such actions were 'based on a [prohibited] discriminatory [or retaliatory] criterion . . . .' " ' " (Guz, supra, 24 Cal.4th at p. 355.)
A plaintiff who satisfies the prima facie showing shifts the burden to the employer to dispel the presumption, which it may do by articulating a legitimate (nonretaliatory) reason for the challenged employment action. (Guz, supra, 24 Cal.4th at pp. 355-356.) If the employer satisfies its burden, the presumption disappears. (Id. at p. 356.) The third step of the McDonnell Douglas framework gives the plaintiff "the opportunity to attack the employer's proffered reasons as pretexts for discrimination [or retaliation], or to offer any other evidence of discriminatory [or retaliatory] motive." (Ibid.)
In the summary judgment context, " 'the employer, as the moving party, has the initial burden to present admissible evidence showing either that one or more elements of plaintiff's prima facie case is lacking or that the adverse employment action was based upon legitimate, nondiscriminatory [or retaliatory] factors.' " (Serri, supra, 226 Cal.App.4th at p. 861.) It is enough at this step for the employer to proffer "competent, admissible evidence" of its reasons, unrelated to bias or retaliatory motive, for the adverse employment action. (Guz, supra, 24 Cal.4th at p. 357.) The proffered reasons, "if nondiscriminatory [or nonretaliatory] . . . need not necessarily have been wise or correct." (Id. at p. 358; see Serri, supra, at p. 861 [noting examples of legitimate, nondiscriminatory reasons for adverse action, like employee's failure to meet performance standards or loss of confidence in employee].)
If the employer meets this initial burden, the plaintiff must " 'demonstrate a triable issue by producing substantial evidence that the employer's stated reasons were untrue or pretextual, or that the employer acted with discriminatory [or retaliatory] animus, such that a reasonable trier of fact could conclude that the employer engaged in intentional discrimination [or retaliation] or other unlawful action.' " (Serri, supra, 226 Cal.App.4th at p. 861; Guz, supra, 24 Cal.4th at p. 357.) "It is not sufficient for an employee to make a bare prima facie showing or to simply deny the credibility of the employer's witnesses or to speculate as to discriminatory [or retaliatory] motive. [Citations.] Rather it is incumbent upon the employee to produce 'substantial responsive evidence' demonstrating the existence of a material triable controversy as to pretext or discriminatory animus on the part of the employer." (Serri, supra, at p. 862.)
As expressed in Guz, "an employer is entitled to summary judgment if, considering the employer's innocent explanation for its actions, the evidence as a whole is insufficient to permit a rational inference that the employer's actual motive was [retaliatory]." (Guz, supra, 24 Cal.4th at p. 361.) " ' "Circumstantial evidence of ' "pretense" must be "specific" and "substantial" in order to create a triable issue with respect to whether the employer intended to discriminate [or retaliate]' on an improper basis." ' " (Husman v. Toyota Motor Credit Corp. (2017) 12 Cal.App.5th 1168, 1182 (Husman).)
2. The Evidence As a Whole Does Not Create a Triable Issue as to Desmond's Retaliation Claims
As the party moving for summary judgment, the hospital had the initial burden to present admissible evidence showing either that one or more elements of Desmond's prima facie case was lacking or that the decision to terminate her employment was based on legitimate, nonretaliatory factors. (Serri, supra, 226 Cal.App.4th at p. 861.) The hospital addressed both prongs in its motion before the trial court. But because it does not challenge Desmond's prima facie case in its responsive briefing on appeal, we focus our analysis on the stated reason for terminating Desmond's employment and on Desmond's responsive showing challenging that reason as false or pretextual. Desmond's arguments in support of her prima facie showing remain relevant, because many of the factors that she relies on also support her points on pretext.
Desmond asserts that she established a prima facie case for retaliation under Labor Code sections 1102.5 and 6310 and Health and Safety Code section 1278.5, because (1) she engaged in a protected activity, (2) her employer subjected her to an adverse employment action, and (3) there is a causal link between the two. (See Patten v. Grant Joint Union High School Dist. (2005) 134 Cal.App.4th 1378, 1384 [stating elements of prima facie case of retaliation under Lab. Code, § 1102.5, subd. (b)]; Cuevas v. SkyWest Airlines (N.D.Cal. 2014) 17 F.Supp.3d 956, 964 [same for Lab. Code, § 6310]; Jadwin v. County of Kern (E.D.Cal. 2009) 610 F.Supp.2d 1129, 1144 [same for Health & Saf. Code, § 1278.5].)
a. Determination That Desmond Violated HIPAA
Desmond argues that the evidence supports an inference that her termination was retaliatory since she never violated HIPAA. She contends that the hospital's HIPAA determination was based on a false narrative supplied by Johnson and rooted in retaliatory animus. The hospital insists that Desmond's conduct violated HIPAA by using as well as obtaining and disclosing protected health information.
The parties' arguments about whether Desmond committed a substantive violation of HIPAA are somewhat misplaced. Whether Desmond violated HIPAA, as a factual matter, is not determinative of whether a triable issue of material fact exists in connection with the retaliation causes of action. "It is the employer's honest belief in the stated reasons for firing an employee and not the objective truth or falsity of the underlying facts that is at issue in a discrimination [or retaliation] case." (King v. United Parcel Service, Inc. (2007) 152 Cal.App.4th 426, 436 (King).)
The asserted violation thus matters only insofar as it supports the hospital's stated reason for terminating Desmond's employment. " '[E]vidence that the employer's claimed reason [for the employee's termination] is false—such as that it conflicts with other evidence, or appears to have been contrived after the fact—will tend to suggest that the employer seeks to conceal the real reason for its actions, and this in turn may support an inference that the real reason was unlawful.' " (Serri, supra, 226 Cal.App.4th at p. 863.) But "[t]his does not mean that the fact finder can examine the employer's stated reasons and impose liability solely because they are found wanting." (Mamou v. Trendwest Resorts, Inc. (2008) 165 Cal.App.4th 686, 715 (Mamou).)
" '[T]he factual dispute at issue is whether discriminatory animus motivated the employer, not whether the employer is wise, shrewd, prudent, or competent.' " (Hersant v. Department of Social Services (1997) 57 Cal.App.4th 997, 1005 (Hersant).) In making this determination, the trier of fact "can take account of manifest weaknesses in the cited reasons in considering whether those reasons constituted the real motive for the employer's actions, or have instead been asserted to mask a more sinister reality." (Mamou, supra, 165 Cal.App.4th at p. 715.) "The ultimate issue when discriminatory [or retaliatory] discharge is alleged is what the employer's true reasons were for terminating the employee." (McGrory v. Applied Signal Technology, Inc. (2013) 212 Cal.App.4th 1510, 1524 (McGrory).)
Applying these principles to our case, the pertinent question is not whether Desmond in fact committed a HIPAA violation, but whether weaknesses in the hospital's assertion that she did supports an inference that it retaliated against her for reporting the scabies problem. We find that the evidence as a whole fails to support such an inference.
First, Desmond claims that she neither disclosed nor accessed confidential patient information during her visit with M.S. She contends that even if we apply the hospital's description of the underlying conduct (the accuracy of which she disputes), there was no HIPAA violation. We believe that Desmond's arguments gloss over the difficult task of ascertaining a privacy violation under the circumstances.
When it enacted HIPAA, "Congress expressed its concern for protecting the integrity and confidentiality of personal medical records, and for preventing the unauthorized use or disclosure of such records. (42 U.S.C. § 1320d-2(d)(2).)" (Bugarin v. Chartone, Inc. (2006) 135 Cal.App.4th 1558, 1561-1562.) Following Congress' mandate, the United States Department of Health and Human Services promulgated regulations setting forth national medical information standards to protect patient privacy. (Brown v. Mortensen (2011) 51 Cal.4th 1052, 1066.) These regulations are commonly known as the " 'Privacy Rule.' " (Ibid., citing Stds. for Privacy of Individually Identifiable Health Information, 67 Fed. Reg. 53182 (Aug. 14, 2002), codified at 45 C.F.R. §§ 160, 164 (2010).) The Privacy Rule serves to "closely regulate the obligations of health plans, medical providers, and their agents to maintain patient confidences" (Brown, supra, at p. 1066) and does so by "defining and restricting the ability of covered entities to divulge confidential medical information" (ibid.).
The Privacy Rule defines protected health information as "individually identifiable health information" (45 C.F.R. § 160.103) which in relevant part includes information that identifies the individual and relates to that person's "past, present, or future physical or mental health or condition . . . ." (ibid.). It is a violation for a covered entity to "use" or "disclose" protected health information, except as permitted by the regulations. (45 C.F.R. § 164.502(a).) The term "use" means "the sharing, employment, application, utilization, examination, or analysis of" individually identifiable health information "within an entity that maintains such information." (45 C.F.R. § 160.103(4)(i)(2)(12).) The term "disclosure" means "the release, transfer, provision of access to, or divulging in any manner of information outside the entity holding the information." (45 C.F.R. § 160.103(4)(iv)(3).) Permitted uses and disclosures of protected health information include "[t]o the individual" (45 C.F.R. § 164.502(a)(1)(i)) and for the covered entity's own "treatment, payment, or health care operations" (id., §§ 164.502(a)(1)(ii), 164.506(c)(1)).
Johnson's investigation notes described the underlying conduct as follows: "Pam Desmond visited patient post discharge, inquiring of her medical condition. Discussed the possibility of patient being the source of scabies. Stated several nurses had scabies. Upset patient." The hospital's outside counsel gave a similar summary of what he was told for purposes of analyzing the conduct under HIPAA. Jergesen declared, "Ms. Martin went on to inform me that an employee nurse who was aware of [the hospital]'s finding that the patient was not the patient source [of the infection], visited the patient at the skilled nursing facility while the employee was off duty, and informed the patient that the patient was the suspected source of the skin infection." The hospital's ultimate findings, as set forth in the January 28, 2015 notice of intended discipline, were that Desmond "visited the patient outside of the hospital, outside the scope of [her] job to discuss [the patient's] medical condition."
Desmond argues that even assuming the hospital's description of what had occurred was accurate, it is not a violation of HIPAA to discuss the health condition of a patient with that patient. She points to an advisory summary on the Privacy Rule issued by the United States Department of Health and Human Services, Office for Civil Rights, which states unequivocally that "[a] covered entity may disclose protected health information to the individual who is the subject of the information." This is consistent with the regulations stating that "[a] covered entity is permitted to use or disclose protected health information . . . [¶] [t]o the individual." (45 C.F.R. § 164.502(a)(1)(i).)
We grant appellant's unopposed request for judicial notice of the United States Department of Health and Human Services, Office for Civil Rights, Summary of HIPAA Privacy Rule<https://perma.cc/3MVT-CS2N >(as of April 15, 2020) and of 45 Code of Federal Regulations, section 164.502. Judicial notice is proper pursuant to Evidence Code section 452, subdivisions (b) and (c).
Desmond claims that privacy officer Martin's deposition reveals that she, too, initially made the determination that Desmond's visit with M.S. was not a HIPAA violation. Desmond contends that the hospital cannot point to any provision of HIPAA or of its own policies that prohibit a nurse from contacting or befriending a former patient. Desmond's former colleagues, Ruiz and Jackson, attested that they were unaware of any such policy. Jackson further declared that she had witnessed hospital managers and nurses visit former patients at other facilities or at their homes.
We find that Desmond's interpretation of HIPAA fails to reckon with the full set of circumstances presented in the summary judgment motion. It may be true that the sharing of a patient's health information with that patient—whether within the entity that maintains the information or outside the entity holding the information—does not violate the Privacy Rule. (45 C.F.R. § 160.103.) But that determination is less clear when considering that here, Desmond was trying to not only share information with a former patient but to gain information about that individual's health condition. She admittedly acted outside the scope of her work when she went to visit M.S.; yet in speaking with her employer later that day, she recounted her visit with M.S. and described the former patient's (apparently improved) skin condition. As the hospital points out, Desmond acknowledged in her deposition that M.S.'s skin condition was her private health information, and that Desmond's knowledge of that information is what led her to visit M.S. Desmond also acknowledged that she pursued follow-up information from the nurse at the skilled nursing facility, which demanded the disclosure of protected health information concerning M.S.'s condition, diagnosis, and treatment.
We do not make these observations because they prove or disprove either side's contentions about Desmond's conduct having violated HIPAA. As stated earlier, we need not resolve that dispute. The fact that reasonable minds might differ in evaluating the conduct at issue for a HIPAA violation cuts against a rational inference of retaliation. To meet her secondary burden on summary judgment, Desmond cannot merely demonstrate there is a triable issue or dispute as to whether the hospital's interpretation of HIPAA was correct. Instead, the evidence must suggest that the application of HIPAA was so implausible, weak, or incoherent that a rational trier of fact could infer the hospital did not actually terminate her based on her alleged HIPAA violation. (Serri, supra, 226 Cal.App.4th at p. 863; Mamou, supra, 165 Cal.App.4th at p. 715; Hersant, supra, 57 Cal.App.4th at p. 1005.) We believe that the hospital's assertion that Desmond violated HIPAA when she visited her former patient about her skin condition is not susceptible to such an inference for several reasons.
First, Desmond's argument that she did not violate HIPAA ignores evidence that she decided to check on M.S. due to the skin condition she had been suffering from while a patient at the hospital (which Desmond at the time suspected might have been the source of the outbreak at the hospital) and that Desmond sought information about the patient's condition and treatment from the nurse at the skilled nursing facility.
Second, Desmond's claim that Martin initially believed the conduct was not a HIPAA violation does not comport with the evidence. Martin filled out a form called "HIPAA Breach Decision Tool and Risk Assessment Documentation" during the hospital's internal investigation. The form presents a series of questions to assist the provider in analyzing a potential health information privacy breach. To the question of whether an exception applies, Martin wrote "Maybe ?" and added "If info to [patient] herself." She testified that she filled out the form as she was "working through this" and thinking that "if the release of the information is to the patient herself, then it wouldn't be a breach. . . . [¶] So I hadn't settled in my mind about releasing information to one's self. And attorney Jergesen addresse[d] that in the letter that he sent. Because that's something I did discuss with him." Viewed in the light most favorable to Desmond as the party opposing summary judgment (Schachter, supra, 47 Cal.4th at p. 618), the evidence reveals that Martin was initially uncertain whether there was a HIPAA violation, justifying her decision to seek advice from legal counsel.
Third, Desmond's assertion that hospital staff frequently visited former patients, and that doing so did not violate any hospital policies or raise privacy concerns, glosses over both the evidence which prompted her concern, which was that she and several nurses had scabies and she suspected M.S.'s painful skin condition to be the source, and the protected health information involved in her visit and follow-up call. The hospital thus derived its findings from conduct that bore little resemblance to a purely personal visit between an employee and former patient who had formed a social bond.
In sum, while we need not decide whether a HIPAA violation occurred, we find the evidence overall fails to support Desmond's assertion that the hospital's HIPAA determination was unequivocally wrong. The evidence also fails to demonstrate " 'such weaknesses, implausibilities, inconsistencies, incoherencies, or contradictions in the employer's proffered legitimate reasons for its action' " (Hersant, supra, 57 Cal.App.4th at p. 1005) such that a reasonable factfinder could rationally find the hospital was not being truthful when it cited to a HIPAA violation as a basis for Desmond's termination.
b. Evidence of Pretext and Retaliatory Motive
Next, Desmond argues that the hospital's reliance on the opinion of outside counsel in making its HIPAA determination skewed the process, because Jergesen's opinion was based on inaccurate information provided by Johnson and relayed through Martin. Desmond claims the evidence supports an inference that both Johnson and Martin harbored retaliatory animus, violating the requirement articulated in Reeves v. Safeway Stores, Inc. (2004) 121 Cal.App.4th 95 (Reeves) that each substantial contributor to the termination decision acted without illegal motive. Desmond insists that hearsay cannot serve as substantial evidence in support of an employer's asserted reason for an adverse employment action. The hospital responds that none of the evidence cited by Desmond raises a triable issue challenging the honesty and objective reasonableness of the hospital's investigation and termination decision under the circumstances, which is all that is required under Cotran.
In Cotran, the California Supreme Court addressed the factual showing required to prove wrongful termination based on breach of an implied contract not to terminate employment except for good or just cause. (Cotran, supra, 17 Cal.4th at pp. 95, 109.) The court held that for an employee hired under an implied agreement not to be dismissed except for "good cause" (id. at p. 95), the question of liability hinges not on whether the plaintiff "in fact" committed the misconduct alleged, but whether, at the time the decision to terminate employment was made, the employer "acting in good faith and following an investigation that was appropriate under the circumstances, had reasonable grounds for believing [the] plaintiff had done so" (id. at p. 109). Cotran defined good cause as "fair and honest reasons . . . that are not trivial, arbitrary . . . or pretextual" and "supported by substantial evidence gathered through an adequate investigation . . . ." (Id. at p. 108.)
The hospital argues that Cotran's standard for a "fair and honest" termination decision (Cotran, supra, 17 Cal.4th at p. 108) applies when an employer's defense is that it conducted a fair investigation. But the cause in this case arises not from an implied employment contract like in Cotran, but from allegations of unlawful retaliation. While there are parallels, in that the finder of fact in both types of cases considers the employer's reasons for the adverse employment action, the ultimate question for the factfinder is not the same. (See McGrory, supra, 212 Cal.App.4th at p. 1533.) Cotran requires the jury to decide whether the employer had reasonable grounds supported by substantial evidence at the time of its termination decision for believing the plaintiff had committed misconduct. (Cotran, supra, at p. 109.) In a retaliation case, the employer's showing that its decision was objectively reasonable following an appropriate investigation does not warrant summary judgment if the plaintiff responds with substantial evidence from which a reasonable jury could conclude that the employer's objective explanation was pretextual and the employer acted with retaliatory animus. (Serri, supra, 226 Cal.App.4th at p. 861; Guz, supra, 24 Cal.4th at p. 357.)
The involvement of multiple participants in an adverse employment decision further obscures the matter, because it may be possible for the plaintiff to raise a reasonable inference of retaliatory motive as to certain participants in the process even though the employer otherwise demonstrated its termination decision was objectively reasonable following an appropriate investigation. In Reeves, a panel of this court addressed such a scenario. The court held that an employer may be liable for retaliatory discharge, even after an objectively reasonable investigation and termination process, if the supervisor who initiated disciplinary proceedings acted with retaliatory animus and that "retaliatory motive was an actuating, but-for cause of the dismissal." (Reeves, supra, 121 Cal.App.4th at p. 100.)
Reeves involved a grocery store's decision to fire one of its clerks after an incident in which the clerk allegedly pushed a store manager and engaged in other inappropriate conduct. (Reeves, supra, 121 Cal.App.4th at pp. 100, 104.) The district manager responsible for the termination decision was not aware that the clerk had previously complained several times to his managers about sexual harassment at the store. (Id. at p. 105.) The managers, who apparently had ignored the sexual harassment complaints, investigated the pushing incident and recommended termination to the district manager. (Id. at pp. 103-105.) The plaintiff sued for retaliation under the Fair Employment and Housing Act (FEHA) and the trial court granted the defendant's motion for summary judgment, finding under McDonnell Douglas that the plaintiff had failed to raise a triable issue of material fact in response to the defendant's legitimate reason for the termination based on the alleged battery of the store manager. (Reeves, supra, at p. 105.)
A panel of this court reversed. The court explained that a plaintiff can establish that "retaliatory animus was a but-for cause of the employer's adverse action" (Reeves, supra, 121 Cal.App.4th at p. 108) by showing "that any of the persons involved in bringing about the adverse action held the requisite animus, provided that such person's animus operated as a 'but-for' cause, i.e., a force without which the adverse action would not have happened" (ibid.). This concept is sometimes referred to as "cat's paw," where the actor who acted without animus "may be found to have operated as a mere instrumentality or conduit for others who acted out of discriminatory or retaliatory animus, and whose actions were a but-for cause of the challenged employment action." (Id. at p. 113.) As applied to the clerk's termination in Reeves, the court found the defendant had articulated a legitimate nondiscriminatory reason for its decision only with respect to the district manager who was unaware of the sexual harassment complaints. (Id. at pp. 112-113.) The nonretaliatory motive of the district manager was insufficient, since the process leading to the clerk's dismissal involved several actors, including the plaintiff's direct supervisor whose conduct raised triable issues as to whether he harbored retaliatory motive which could be imputed to the employer. (Id. at p. 116.)
We draw the following guidance from these cases. First, the standard for just cause termination based on "fair and honest reasons . . . that are not trivial, arbitrary . . . or pretextual" and "supported by substantial evidence gathered through an adequate investigation" (Cotran, supra, 17 Cal.4th at p. 108) is instructive for assessing the hospital's asserted basis for its adverse employment action. Second, an employer that meets its burden under McDonnell Douglas of demonstrating a legitimate, nonretaliatory basis for its adverse employment decision may nonetheless be liable for retaliation if the plaintiff meets its responsive burden (Serri, supra, 226 Cal.App.4th at p. 862), including by showing that "that any of the persons involved in bringing about the adverse action" harbored retaliatory animus, "provided that such person's animus operated as a 'but-for' cause, i.e., a force without which the adverse action would not have happened" (Reeves, supra, 121 Cal.App.4th at p. 108).
Desmond likens Johnson's conduct to that of the grocery clerk's supervisor in Reeves. She argues that retaliatory animus may be inferred from Johnson's irritation upon receiving Desmond's scabies complaint, from the one-sided report about Desmond's visit to the skilled nursing facility that Johnson conveyed to Martin (who re-conveyed it to Jergesen), and from the actions Johnson later took against Ruiz for ordering a scabies test when M.S. was readmitted to the hospital. Desmond also argues that Martin's failure to relay Jergesen's revised opinion—in which he concluded that Desmond's visit with M.S. entailed a HIPAA violation of disclosure, not use—to the other decisionmakers raises a triable issue of fact as to whether she too harbored retaliatory animus. We consider, like in Reeves, whether the conduct of any of the principal actors involved in the HIPAA investigation and termination decision, including Johnson and Martin, supports an inference of retaliation, justifying an imputation of their conduct and motives to the hospital. (Reeves, supra, 121 Cal.App.4th at p. 116.) In doing so, we may not weigh Desmond's evidence or inferences but "must nevertheless determine what any evidence or inference could show or imply to a reasonable trier of fact." (Aguilar, supra, 25 Cal.4th at p. 856.)
First, Desmond invokes the reaction of her direct supervisor at the time, Meghan Kelly, who apparently responded to Desmond's initial report that she and others had an itchy rash by doing nothing, other than saying, "O God. Don't tell me that." Desmond argues that the reasonable inference to be drawn from Kelly's exclamation and failure to follow up was that she was discouraging Desmond from making safety complaints. Desmond contends that this alone is sufficient to raise a triable issue of fact, because Kelly was involved in the decision to terminate her.
We believe that while a reasonable jury could conclude that Kelly's response to Desmond's complaint and subsequent inaction was unprofessional or inept, there is no evidence to suggest she was discouraging Desmond from making protected complaints. According to Desmond's declaration, after the meeting where she, Jackson, and another nurse met with Johnson for the first time to tell her they thought they had scabies, Desmond turned to Kelly and asked if she knew if the hospital had an infection control nurse, and Kelly responded " 'No.' " Nor does the evidence show that Kelly had any role in the hospital's investigation or termination decision. Because the key inquiry is " 'whether discriminatory animus motivated the employer, not whether the employer is wise, shrewd, prudent, or competent . . .' " (Hersant, supra, 57 Cal.App.4th at p. 1005), we are unable to derive any triable issue of material fact from Kelly's apparent failure to pursue Desmond's safety complaint.
Kelly was among the participants present at the January 23, 2015 investigatory meeting where Martin and Juarez confronted her about her purported HIPAA violation. Otherwise, there is no evidence that she took part in the investigation or findings, other than to communicate to Desmond her placement on administrative leave.
Next, Desmond posits several ways in which the evidence supports a reasonable inference that Debra Johnson, the director of infection prevention and control who initiated the HIPAA investigation, sought to retaliate against her.
Desmond attested that Johnson was upset by Desmond's and the other nurses' scabies disclosures and blamed them for not reporting to her sooner, though they were not aware of Johnson's position at the hospital or of any protocol to report to her. Johnson told the nurses that "this was going to give [her] a lot of work." Johnson also seemed exasperated when Desmond expressed her concern about M.S., who Desmond thought had gone undiagnosed and could still be suffering, and continued to tell Desmond to take care of herself and her family. Desmond also claims that Johnson did not indicate that she may have violated HIPAA during their conversation about the visit with M.S.; yet she contacted Gonder and Martin about a HIPAA violation, knowing it could be a terminable offense. In an e-mail to other management, the hospital's communications director referred to the potential scabies outbreak as a "PR disaster," and internal correspondence showed that the hospital sought to provide its department heads with Johnson's "scripting" about the potential outbreak to avoid references to words like "scabies" and "confirmed."
As noted ante in footnote 4, Desmond's own evidence and complaint allegation is contradictory on this point.
Desmond also relies on the declaration of her colleague, Sandra Ruiz, who also encountered Johnson's hostility regarding the scabies outbreak within the hospital. After Desmond's January 23 investigatory meeting, for example, Ruiz sent Johnson a request for the hospital's policy for testing and treating scabies and received no response. She attested that when M.S. was readmitted to the hospital in March 2015, the treating physician ordered a scabies test for her, which Ruiz entered into the electronic health record. A lab employee called Ruiz and told her that she had to clear the test with Johnson. Johnson's demeanor on the phone was hostile and aggressive. She told Ruiz that " 'We don't test for scabies at [the hospital]!' " Ruiz explained that the doctor had ordered the test. As a result of the exchange, the doctor told Ruiz that they would just treat the patient, and Ruiz placed the prescription order for a scabicide. Less than an hour later, Ruiz was called to an emergency human resources meeting in which she was accused of putting in orders for doctors and of being rude to Johnson. Although she was not formally disciplined, Ruiz no longer received the flexible shifts that enabled her to pursue her master's degree and she no longer worked as a charge nurse, as she had for 18 years. When Ruiz later pressed Johnson about the hospital's position on scabies testing, she was met with further hostility.
Viewing this evidence in the light most favorable to Desmond, we believe that a reasonable jury could conclude that the hospital was heavily focused on limiting the adverse public relations consequences of a scabies outbreak, possibly to the detriment of responding proactively with treatment and testing protocols while communicating with employees about that response. The jury could reasonably infer that Johnson was part of this effort and that she resented the occurrence of the scabies infections and the associated problems for her and the hospital. The jury also could infer from the evidence that Johnson resented the seemingly delayed disclosures by Desmond and the other nurses, who had experienced itchy rash symptoms for weeks before identifying the problem and reporting it. Thus, we agree with Desmond that the evidence supports at least the inference that the hospital was motivated by a fear of bad publicity and that Johnson in particular resented the problems the outbreak posed for her and was concerned about the continuing implication of scabies at the hospital.
Yet we do not find " ' "specific" and "substantial" ' " evidence in the record (Husman, supra, 12 Cal.App.5th at p. 1182) to support an inference that Johnson's frustration with the nurses' complaints prompted the investigation into Desmond's visit to the skilled nursing facility or provoked a retaliatory end to her employment. There is no evidence to suggest that Johnson fabricated her concern about the potential HIPAA violation. In the phone conversation between Johnson and Desmond, Desmond reiterated her worry for M.S. and shared with Johnson the fact that she had visited M.S. that day at the skilled nursing facility. Johnson then asked whether M.S. was a friend. The only reasonable inference to be drawn from this seemingly neutral question is that Johnson—confronted with what Desmond later acknowledged to be a "grey area" of professional standards and practice—tried to ascertain whether the visit pertained to an established friendship or was prompted by Desmond's previously articulated conviction that M.S. had been discharged with undiagnosed Norwegian scabies. Desmond's response that she had come to care for M.S. after caring for her for the past months effectively acknowledged that they did not have a prior friendship. We find that under these circumstances, Johnson's decision to contact Gonder and Martin about Desmond's self-disclosed visit to the skilled nursing facility does not support an inference of retaliatory motive or animus. To the contrary, because Desmond's visit coincided with her repeated requests for the hospital to check on M.S. due to her concern about M.S.'s health status, the hospital's privacy obligations practically mandated it to inquire into whether Desmond's conduct might have violated HIPAA.
Nor do we find the evidence that Johnson and Martin provided Jergesen with only the hospital's summary of what had occurred, or that Martin never informed the others about Jergesen's e-mail clarifying his HIPAA analysis, reasonably susceptible to the inferences that Desmond ascribes to it. The evidence shows that Martin contacted Jergesen for a legal opinion only after the January 23 investigatory meeting, where Desmond had the opportunity to explain her actions. Martin attested that she offered to contact Jergesen "for a second opinion if that would increase the Hospital's comfort level" with her determination after the investigatory meeting that Desmond's conduct constituted a privacy breach. Although Desmond asserts that Johnson provided Martin with an inaccurate depiction of what had transpired—in effect perpetuating a false narrative based on hearsay, Lacanilao's declaration submitted in support of the motion for summary judgment shows that the information the hospital gave to Jergesen was consistent with what Lacanilao told Johnson. The consistent statements undercut, and render speculative, any notion that Johnson's frustration with Desmond or resentment about the hospital's predicament led her to provide inaccurate information to Martin. And because Jergesen's clarification about "improper disclosure" versus "improper use" did not change his substantive conclusion that a HIPAA violation likely occurred, Martin's failure to update the team about the clarification does not support a reasonable inference of retaliatory animus or illegal motive.
Several factors thus differentiate the investigation in this case from that in Reeves. Whereas in that case the plaintiff's supervisor never spoke to the plaintiff about the underlying incident and relied instead on information from two employees who each "had a reason" to portray the plaintiff's conduct " 'in the worst possible light' " (Reeves, supra, 121 Cal.App.4th at p. 117), in this case Desmond had several opportunities to explain her actions, both in person and in writing, to the decisionmakers involved in the termination decision. Unlike the employer's reliance in Reeves on the accounts of two employees who may have been motivated to slight the plaintiff, the hospital here was informed by Desmond's own account of her concern about M.S. and subsequent visit to the skilled nursing facility, and by Lacanilao's statement to Johnson, which confirmed the general details of Desmond's visit and offered (as hearsay) M.S.'s account of the visit. There is no evidence from which to infer that Lacanilao, as a disinterested third party, was antagonistic to Desmond's interests, or that Johnson misrepresented the information she obtained from Lacanilao. To the contrary, Johnson's summary is entirely consistent with Lacanilao's sworn declaration. Nor is there evidence from which to infer that Martin's efforts to assess whether a HIPAA violation might have occurred, including by completing the "HIPAA Breach Decision Tool and Risk Assessment Documentation" form during the hospital's internal investigation and by seeking an opinion from outside counsel, was mere pretense.
Desmond objects that Lacanilao's statement consisted of multiple levels of hearsay, which then comprised the basis for the hospital's termination decision. Citing Humboldt County Adult Protective Services v. Superior Court (2016) 4 Cal.App.5th 548, 571 (Humboldt County), she contends that hearsay does not constitute substantial evidence for purposes of reaching a for cause termination decision. But as noted above, the employer's burden in seeking summary judgment in an employment retaliation case is not identical to the burden articulated in Cotran for a wrongful termination implied breach of contract case. The employer's burden here is to show by "competent, admissible evidence" (Guz, supra, 24 Cal.4th at p. 357) that its reasons for the adverse employment action were unrelated to bias or retaliatory motive, even if they were not wise or correct. (Serri, supra, 226 Cal.App.4th at p. 861.) Because the hospital met its burden to establish a nonretaliatory motive for its decision, the responsive burden is Desmond's, as the plaintiff, to " 'demonstrate a triable issue by producing substantial evidence that the employer's stated reasons were untrue or pretextual, or that the employer acted with discriminatory [or retaliatory] animus . . .' " (ibid.), such that a reasonable trier of fact could conclude the employer engaged in intentional retaliation.
We do not believe that the hospital's reliance on Lacanilao's summary of M.S.'s description of Desmond's visit supports an inference that the hospital's stated reasons were untrue or pretextual. Our Supreme Court reasoned in Cotran that balancing employer and employee interests in wrongful termination employment litigation necessitates latitude for employers to act on factual findings "typically gathered under the exigencies of the workaday world and without benefit of the slow-moving machinery of a contested trial . . . ." (Cotran, supra, 17 Cal.4th at pp. 105-106.) From an evidentiary standpoint, hearsay utilized by an employer to support an adverse employment action is not offered for the truth of the matter asserted but for purposes of demonstrating that the employer honestly concluded that "a dischargeable act had been committed ' "after an appropriate investigation and for reasons that are not arbitrary or pretextual." ' " (Humboldt County, supra, 4 Cal.App.5th at p. 571, quoting Cotran, supra, at p. 107.) In other words, "[w]here the reasonableness of a person's conduct is at issue, statements of others on which he [or she] acted are admissible." (Silva v. Lucky Stores, Inc. (1998) 65 Cal.App.4th 256, 265 (Silva).)
Here, Desmond challenges the legitimacy of Johnson's and Martin's investigation and the reasonableness of their concern that the alleged conduct might have violated HIPAA. But the hospital submitted declarations from each of the individuals involved in both the investigation and in Desmond's termination decision. These provided competent evidence of the process by which each person arrived at their decision. To the extent the declarants relied on hearsay accounts of Desmond's visit to the skilled nursing facility, we find those statements were not offered to establish the truth of what occurred at the skilled nursing facility but for their effect on the declarants, who believed on that basis that Desmond had violated HIPAA.
Silva is instructive on this point. The plaintiff, who had been dismissed from his 28-year employment with a grocery chain based on allegations that he sexually harassed two employees, denied the allegations. (Silva, supra, 65 Cal.App.4th at pp. 259, 277.) He contended that summary judgment was improper because the human resources representative who made the termination decision " 'relied on double and triple hearsay' as well as gossip and rumor." (Id. at p. 277.) The court in Silva agreed that the comments and statements of employees referenced in the human resources investigation were "not substantial evidence." (Ibid.) But because the employer's conclusions were based primarily on competent and admissible evidence, including "the statements of the complainants, the percipient witnesses to the incidents and [the plaintiff]'s admissions that physical contact had occurred in" the alleged sexual harassment incidents (ibid.), the court concluded that the plaintiff had not raised a triable issue of fact as to whether the grocery chain's decision to terminate his employment for violation of company policies constituted a reasoned conclusion supported by substantial evidence under Cotran (ibid.).
In our case, Lacanilao's summary of patient M.S.'s translated statements about the visit from Desmond is hearsay, to the extent it was offered to establish what occurred or what was said. (Evid. Code, § 1200 [statement is hearsay only when offered to prove the truth of the matter stated].) Like in Silva, however, the hospital's termination decision was not based only on the factual assertions in the hearsay statement, but on the hospital's reasoned judgment about Desmond's undisputed visit, outside the scope of her work, to a former patient to ascertain that patient's medical condition. The hospital's disciplinary decision, as set forth in the notice of intended discipline, stated that Desmond "visited the patient outside of the hospital, outside the scope of [her] job to discuss [the patient's] medical condition." That determination was supported by competent and admissible evidence, provided largely by Desmond herself, and was not dependent on the hearsay account of what Desmond purportedly discussed with M.S.
In sum, we find that Desmond has not demonstrated a triable issue that the hospital's stated reasons were untrue or pretextual due to the fact that it relied on hearsay statements in Lacanilao's account of Desmond's visit. Although Desmond surmises that Johnson and Martin intentionally misrepresented Lacanilao's account to Jergesen, she offers no evidence to support that supposition. "It is not sufficient for an employee to . . . simply deny the credibility of the employer's witnesses or to speculate as to discriminatory [or retaliatory] motive. [Citations.] Rather it is incumbent upon the employee to produce 'substantial responsive evidence' demonstrating the existence of a material triable controversy as to pretext or discriminatory animus on the part of the employer." (Serri, supra, 226 Cal.App.4th at p. 862.) " ' "Circumstantial evidence of ' "pretense" must be "specific" and "substantial" in order to create a triable issue with respect to whether the employer intended to discriminate [or retaliate]' on an improper basis." ' " (Husman, supra, 12 Cal.App.5th at p. 1182.)
Desmond lastly contends that pretext can be shown by the timing of the adverse employment decision in relation to the protected activity. It is true that temporal proximity between a plaintiff's protected activity and an employer's adverse decision can provide circumstantial evidence of retaliatory motive. (Flait v. North American Watch Corp. (1992) 3 Cal.App.4th 467, 479 [pretext may be inferred from the timing of the employer's termination decision].) Indeed, for Desmond's claim based on the filing of a safety grievance against a health care facility (Health & Saf. Code, § 1278.5), there is a rebuttable presumption of retaliation if the action against the employee occurred within 120 days of the filing of the grievance by the employee, and the responsible staff at the facility knew of the employee's complaint. (Health & Saf. Code, § 1278.5, subd. (d)(1).)
Here, however, the hospital's stated basis for its actions rebuts the statutory presumption of retaliation under Health and Safety Code section 1278.5. And because the circumstances supporting the hospital's stated basis for its decision arose within the same window of time as Desmond's protected complaints, the proximity of Desmond's employment termination to the timing of her protected complaints does not provide circumstantial evidence of an intent to retaliate. This distinguishes our case from Colarossi v. Coty US Inc. (2002) 97 Cal.App.4th 1142, 1154 (Colarossi), which Desmond cites in support of her position on temporal proximity.
In Colarossi, the court recognized that the sequence of the employee's termination not long after her participation in a sexual harassment investigation "may have been coincidental, but when viewed as part of the mosaic of evidence" (Colarossi, supra, 97 Cal.App.4th at p. 1154) the plaintiff presented it "add[ed] to the impression" that the employer possessed a retaliatory motive (ibid.). Among the evidence referenced in Colarossi was what the court called "a veritable 'smoking gun' " (id. at p. 1153) based on the plaintiff's supervisor's expressed desire to get revenge on those who cooperated in the investigation of her alleged harassment, as well as the employer's sudden scrutiny of the plaintiff's weekly reports "with a skepticism previously reserved for the Shroud of Turin" (id. at p. 1154), despite having previously overlooked or even condoned the recordkeeping practices that ultimately served as the stated basis for the plaintiff's firing.
Here, there is no chance that the timing of Desmond's termination not long after her complaints about the hospital's management of the scabies outbreak "may have been coincidental . . . ." (Colarossi, supra, 97 Cal.App.4th at p. 1154.) But because Desmond's visit with her former patient happened concurrently with her protected complaints, and the hospital by statute had only 15 business days to decide whether her actions required reporting according to state law and under HIPAA (Health & Saf. Code, § 1280.15, subd. (b)(1), (2)), the timing of her termination hardly provides circumstantial evidence of retaliatory motive. In contrast with Colarossi, where the plaintiff was scrutinized and disciplined for the same recordkeeping practices that she had previously maintained (Colarossi, supra, at p. 1154), there is no evidence that the hospital abruptly changed its stance on patient privacy to scrutinize Desmond's visit with M.S.
We conclude that even drawing all reasonable inferences in her favor, Desmond has not proffered evidence to support a showing that the hospital's claimed reason for her termination was false, in conflict with other evidence, or contrived after the fact. (Serri, supra, 226 Cal.App.4th at p. 863.) While Desmond has revealed a strict response by the hospital to well-intentioned conduct by a nurse during a stressful period for her and her employer, she has not raised a triable issue of material fact regarding illegal motive for ending her employment. "[C]onsidering the employer's innocent explanation for its actions, the evidence as a whole is insufficient to permit a rational inference that the employer's actual motive was [retaliatory]." (Guz, supra, 24 Cal.4th at p. 361.)
c. The Mixed Motive Analysis Does Not Salvage Desmond's Retaliation Claim
Desmond alternatively proposes, for the first time in her reply brief, that we analyze her retaliation claims based on the mixed motive analysis in Harris v. City of Santa Monica (2013) 56 Cal.4th 203 (Harris).
She correctly points out that the California Supreme Court recognized the shortcomings of the McDonnell Douglas framework in cases under the FEHA where the employer may have had multiple motivations for an adverse employment action. (Harris, supra, 56 Cal.4th at p. 211.) According to Harris, the traditional analysis "presupposes that the employer has a single reason for taking an adverse action against the employee and that the reason is either discriminatory or legitimate. By hinging liability on whether the employer's proffered reason for taking the action is genuine or pretextual, the McDonnell Douglas inquiry aims to ferret out the 'true' reason for the employer's action. In a mixed-motives case, however, there is no single 'true' reason for the employer's action." (Id. at p. 215.) The high court concluded that where discriminatory and legitimate reasons are shown to have motivated the employer's decision, the employer does not escape liability by proving it would have made the same decision absent discrimination; rather, the employer may be liable where unlawful discrimination was a "substantial factor motivating" a termination of employment. (Id. at p. 211.) But the court limited the plaintiff's relief in such a case to declaratory and injunctive relief, as well as attorney fees, and costs. (Id. at pp. 232-235 [rejecting plaintiff's entitlement to economic or noneconomic damages, backpay, or an order of reinstatement, where employer proves it would have made same decision without illegal motive].)
Desmond argues that the mixed motive analysis should apply here, because there is evidence that raises a triable issue of fact as to whether unlawful retaliatory animus was at least a substantial motivating reason for the termination decision. Indeed, in Husman, supra, 12 Cal.App.5th 1168, the appellate court applied Harris to a wrongful termination and employment discrimination and retaliation case under the FEHA. The court reversed the grant of summary judgment as to the discrimination claims because the plaintiff "presented sufficient evidence a substantial motivating factor for his termination was invidious sex or gender stereotyping related to his sexual orientation . . . ." (Id. at p. 1173.) But Husman, like Harris, was a case brought under the FEHA. (Id. at pp. 1182, 1188.) This case is not. Considering that the California Supreme Court's analysis in Harris was largely statutory based on the language and purposes of the FEHA (see Harris, supra, 56 Cal.4th at pp. 211, 215-218), we decline to simply assume, without more, that its holdings concerning liability and remedies necessarily apply here.
C. Desmond's Defamation Claim
Desmond also challenges the summary judgment in favor of the hospital as to her defamation cause of action. She contends there are triable issues of fact as to (1) whether the hospital's alleged, defamatory statements were true, and (2) whether the hospital's statements were made with malice and so not subject to the common interest privilege.
" 'Defamation is an invasion of the interest in reputation. The tort involves the intentional publication of a statement of fact which is false, unprivileged, and has a natural tendency to injure or which causes special damage.' " (Cornell v. Berkeley Tennis Club (2017) 18 Cal.App.5th 908, 946 (Cornell).) Defamation "requires proof of a false and unprivileged publication that exposes the plaintiff 'to hatred, contempt, ridicule, or obloquy, or which causes him to be shunned or avoided, or which has a tendency to injure him in his occupation.' " (McGarry v. University of San Diego (2007) 154 Cal.App.4th 97, 112 (McGarry), citing Civ. Code, § 45; see Taus v. Loftus (2007) 40 Cal.4th 683, 720 (Taus) [listing elements of tort of defamation].)
To be defamatory, the statement at issue "must contain a provable falsehood . . . ." (McGarry, supra, 154 Cal.App.4th at p. 112.) Statements of opinion are generally not actionable for this reason, but can be actionable to the extent the opinion implies a false assertion of fact. (Ibid., citing Milkovich v. Lorain Journal Co. (1990) 497 U.S. 1, 18-19.) The test is "whether a reasonable fact finder could conclude the published statement declares or implies a provably false assertion of fact." (Franklin v. Dynamic Details, Inc. (2004) 116 Cal.App.4th 375, 385 (Franklin).) A published and provably false statement that is subject to a qualified privilege, as discussed further below, is not defamatory. (See Civ. Code, § 47, subd. (c); Brown v. Kelly Broadcasting Co. (1989) 48 Cal.3d 711, 723, fn. 7 (Brown) [clarifying that if the occasion giving rise to the publication is privileged, the privilege is a complete defense to defamation].)
1. The Allegedly Defamatory Statements Did Not Assert False Facts
Desmond's defamation claim refers to statements by the hospital and particularly by Johnson "in . . . January and February 2015 . . . to other [hospital] supervisors, managers, and representatives" that Desmond violated HIPAA, that she improperly accessed and used protected health information, and that she violated standards of professional nursing. She alleges that these statements, both oral and written, were not privileged and were published with malice and hatred in order to harass and injure her, to damage her personal and professional reputation, and to justify her firing in retaliation for her protected complaints.
On appeal, Desmond focuses on the January 28 notice of intended discipline. The hospital responds that the notice cannot form the basis for a defamation claim because the statements relaying the hospital's findings were true. The hospital argues that even if the alleged defamatory statements were false, it would still be entitled to summary judgment under the common interest privilege.
As discussed in connection with Desmond's retaliation causes of action, regardless of whether a HIPAA violation occurred or did not occur, the evidence did not support Desmond's assertion that the hospital's claimed reason for her termination was false. (See ante, part II.B.2.a.) That determination, by design, did not resolve the objective truth or falsity of the facts underlying the hospital's belief in its stated reasons for firing Desmond. (See King, supra, 152 Cal.App.4th at p. 436.) Yet it is the objective truth or falsity of those facts that is at issue in the defamation cause of action, which is viable only if "a reasonable fact finder could conclude the published statement declare[d] or implie[d] a provably false assertion of fact." (Franklin, supra, 116 Cal.App.4th at p. 385.) "Whether a statement declares or implies a provably false assertion of fact is a question of law for the court to decide . . . ." (Ibid.) Courts consider the "totality of the circumstances" by examining both the language of the statement and the context in which the statement was made. (Ibid.)
The hospital's January 28 notice of intended discipline was sent to Desmond, Desmond's union representative, and three members of the hospital administration who were involved in the disciplinary process. The notice outlined the hospital's process and reasons for deciding to terminate Desmond as a result of the HIPAA determination. It summarized the January 23 investigatory meeting, including who was present and what was discussed, and the information received from the skilled nursing facility according to the statements of M.S. and the nursing director. It also summarized Desmond's explanation of the visit in which she denied having discussed her concerns about scabies with M.S.
The recipients listed on the January 28, 2015 notice were Desmond, Teresa Mack (labor representative), Christie Gonder (chief nursing officer), Agnes Lalata (nursing director), and Michelle Childs (senior human resources director).
Next, it explained the hospital's findings, including that (1) Desmond was the nurse who visited the patient, (2) the patient did not know the visitor's name and could not identify her, (3) the visit "was an improper use of" protected health information that Desmond received while performing her duties at the hospital, and (4) Desmond "visited the patient outside of the hospital, outside the scope of [her] job to discuss her medical condition." The notice then stated the hospital's determination that Desmond had violated hospital policies for use and disclosure of protected health information, HIPAA sanctions, and standards of professional behavior, and concluded by describing the hospital's reporting obligations, disciplinary policy, and further procedures for Desmond to respond to the investigation findings.
Applying the totality of the circumstances, we conclude that a reasonable factfinder could not construe the notice as implying or declaring "a provably false assertion of fact." (Franklin, supra, 116 Cal.App.4th at p. 385.) First, to be defamatory, the language of the notice would need to be " 'understood in a defamatory sense . . . .' " (Ibid.) But it is apparent from the notice that the hospital drew its own conclusion from a disputed set of facts, which it expressly referenced. "Where the language of the statement is 'cautiously phrased in terms of apparency,' the statement is less likely to be reasonably understood as a statement of fact rather than opinion." (Baker v. L.A. Herald Examr. (1986) 42 Cal.3d 254, 260-261, fn. omitted; id. at p. 260, fn. 4 [explaining that " 'apparency' " means " 'appearance' or 'the quality or state of being apparent' "].) Although several of the facts that the hospital referenced and relied upon were in dispute (such as whether M.S. recognized Desmond and what they discussed), they were not "provably false" so as to be understood as defamatory. That is, "it appears very doubtful that such a statement properly could be viewed as a statement of fact (which could support a defamation action), rather than an expression of opinion (which cannot)." (Taus, supra, 40 Cal.4th at p. 720.)
Next, we consider the context in which the allegedly defamatory statements were made. (Franklin, supra, 116 Cal.App.4th at p. 389.) Courts review "the nature and full content of the communication and . . . the knowledge and understanding of the audience to whom the publication was directed." (Baker v. L.A. Herald Examnr., supra, 42 Cal.3d at p. 261.) In our case, the notice fairly summarized the initial steps taken by the hospital and its stated reasons for finding that Desmond's conduct violated its privacy policies. The notice was not directed to a wide audience, but to the relevant subgroup of administrators, as well as to Desmond and her union representative. This audience was familiar with the context in which Desmond's actions took place and understood the purpose of the notice. While certain recipients may have disagreed with the hospital's representation of underlying facts or its determination of a privacy violation, they would have understood the hospital's purpose in documenting its disciplinary process and decision. Considering the language and context of the notice, we conclude that a reasonable factfinder would be hard pressed to conceive of the notice, summarizing the hospital's investigation thus far and stating its opinion that a violation had occurred, as asserting "a provable falsehood . . . ." (McGarry, supra, 154 Cal.App.4th at p. 112.)
2. The Common Interest Privilege Applies to These Circumstances
We further conclude that even if the statements could be perceived as defamatory, they were covered by the common interest privilege.
The common interest privilege, set forth in Civil Code section 47, subdivision (c)(1), provides in relevant part: "A privileged publication or broadcast is one made: [¶] . . . [¶] (c) In a communication, without malice, to a person interested therein, (1) by one who is also interested . . . ." It is often said that the common interest privilege is overcome by a showing of malice, but a more accurate characterization is that if malice is shown, the privilege does not arise in the first instance. (Kashian v. Harriman (2002) 98 Cal.App.4th 892, 914-915 (Kashian), citing Brown, supra, 48 Cal.3d at p. 723, fn. 7.) "Malice for purposes of the statute means ' "a state of mind arising from hatred or ill will, evidencing a willingness to vex, annoy or injure another person." ' " (Kashian, supra, at p. 915, quoting Brown, supra, at p. 723.) Courts use a two-step analysis to determine application of the privilege. (Kashian, supra, at p. 915.) At trial, the defendant "bears the initial burden of establishing that the statement in question was made on a privileged occasion," at which point the burden shifts to the plaintiff to "establish that the statement was made with malice." (Taus, supra, 40 Cal.4th at p. 721.)
Desmond does not deny that the challenged statements arose in a setting covered by the privilege but contends there is a triable issue as to whether the publication was made without malice. We find the statements in the January 28 notice of intended disciplinary action arose on an occasion subject to the privilege, and that the available evidence does not create a triable issue as to malice.
Appellate court opinions have differed in their treatment of the respective burdens on summary judgment. (Compare Cornell, supra, 18 Cal.App.5th at p. 951 [analyzing summary adjudication of defamation claim with traditional burden shift, such that once defendant has satisfied the initial burden, plaintiff must demonstrate a triable issue of fact as to whether defendant acted with malice] with Mamou, supra, 165 Cal.App.4th at p. 729 [stating that on summary judgment, "the defendant bears the burden of showing in the first instance that there is no triable issue of fact as to either issue—that the statement was made on a privileged occasion, and that it was made 'without malice' "].) We need not resolve the question because we find that either way, the hospital has demonstrated that Desmond cannot point to evidence from which a triable issue may be inferred concerning actual malice.
The common interest privilege historically " 'protected communications made in good faith on a subject in which the speaker and hearer shared an interest or duty.' " (Kashian, supra, 98 Cal.App.4th at p. 914.) " 'Communications made in a commercial setting relating to the conduct of an employee have been held to fall squarely within the qualified privilege for communications to interested persons.' " (Cornell, supra, 18 Cal.App.5th at p. 949.)
For example, in Cuenca v. Safeway San Francisco Employees Fed. Credit Union (1986) 180 Cal.App.3d 985, 995-996 (Cuenca), the court affirmed the grant of summary judgment, applying in pertinent part the common interest privilege to the defendant credit union's board of directors' supervisory committee report alleging misconduct by the plaintiff employee. The court reasoned that the statements in the report were both "directly relevant" (id. at p. 996) to the plaintiff's role in managing the credit union and to "matters of direct interest to the . . . supervisory committee . . . and its board of directors" (ibid.). In Cornell, the court found that the employer tennis club met its initial burden of showing the allegedly defamatory statements accusing the plaintiff of employee misconduct qualified for the privilege because they "were made in discussions only 'with other club personnel or members . . .—i.e., the discussions were limited to those who had an interest in the club.' " (Cornell, supra, 18 Cal.App.5th at p. 949.) However, the court reversed the grant of summary adjudication of the plaintiff's defamation claim based on a triable issue of actual malice. (Id. at pp. 950-951.)
There is no question that the recipients of the January 28 notice of intended discipline had an interest in reviewing Desmond's actions and a duty to assess whether those actions violated hospital policy. (Cuenca, supra, 180 Cal.App.3d at p. 996.) The hospital established that it communicated the reason for Desmond's termination to these individuals—several managers and administrators involved in the investigation and disciplinary determination (Cornell, supra, 18 Cal.App.5th at p. 949), and otherwise reported only the circumstances of the determined HIPAA violation to the necessary government agencies and the affected patient. Desmond has not proffered evidence to support the claim that the hospital published the false information "to numerous other persons" unknown to her, as alleged in her complaint.
Having demonstrated that the January 28 notice of intended discipline and related communications were made to "person[s] interested therein . . . by one who is also interested . . ." (Civ. Code, § 47, subd. (c)(1)), we turn to the question of malice. A "prima facie case that these statements were made with ' "[a]ctual malice" ' " (Taus, supra, 40 Cal.4th at p. 721) precludes application of the privilege. According to our Supreme Court, " ' " 'actual malice' . . . is established by a showing that the publication was motivated by hatred or ill will towards the plaintiff or by a showing that the defendant lacked reasonable grounds for belief in the truth of the publication and therefore acted in reckless disregard of the plaintiff's rights." ' " (Ibid.)
We agree with the hospital that there is no triable issue as to actual malice. Desmond cites Burrill v. Nair (2013) 217 Cal.App.4th 357, 390 (Burrill), disapproved of on another ground by Baral v. Schnitt (2016) 1 Cal.5th 376, 386-387, for the proposition that " '[a]ctual malice may be proved by direct or circumstantial evidence. Factors such as failure to investigate, anger and hostility, and reliance on sources known to be unreliable or biased "may in an appropriate case, indicate that the publisher himself [or herself] had serious doubts regarding the truth of his [or her] publication." ' " (Burrill, supra, at p. 390.) But there is no evidence, direct or circumstantial, that the hospital " ' "lacked reasonable grounds for belief in the truth" ' " (Taus, supra, 40 Cal.4th at p. 721) of the statements in its notice or was " ' "motivated by hatred or ill will" ' " (ibid.) in publishing its investigation findings and disciplinary determination to select individuals with a common interest in the process.
Desmond asserts that the hospital's investigation was grossly inadequate due to the fact that it relied only on Johnson's statement regarding Desmond's visit with M.S. at the skilled nursing facility and because Martin herself had doubts about whether Desmond's conduct violated HIPAA. To repeat our earlier assessment, the January 28 notice of intended discipline fairly reported the hospital's findings according to the information provided by Lacanilao—a disinterested third party—and set forth Desmond's dispute with those findings in the notice. The evidence of Martin's initial uncertainty about whether the conduct constituted a HIPPA violation, and even what could be fairly perceived as the hospital's hostility in responding to the nurses' scabies-related complaints and inquiries, do not under the circumstances presented support an inference that the hospital " ' "had serious doubts regarding the truth of his [or her] publication." ' " (Burrill, supra, 217 Cal.App.4th at p. 390.)
Several cases reinforce our view that the evidence here fell short of creating a triable issue as to actual malice. In Taus, the California Supreme Court considered evidence of malice to defeat the application of the common interest privilege in the context of reviewing the dismissal of an anti-SLAPP motion to strike. (Taus, supra, 40 Cal.4th at pp. 720-722.) The plaintiff in Taus was the unnamed subject of a case study described in several scholarly articles on childhood maltreatment (id. at p. 689) who claimed that a professor who critiqued the methodology described in the articles defamed her while speaking at a professional conference for mental health professionals. (Id. at p. 710.) The professor's statements allegedly revealed that the plaintiff had " 'engaged in destructive behavior' " that the professor could not reveal and was " 'in the Navy representing our country.' " (Ibid.) The high court questioned the appellate court's conclusion that the statements had a defamatory implication about the plaintiff's fitness for military service and, more pertinently to our analysis, found that the plaintiff could not establish defamation because the statements came within the common interest privilege. (Id. at p. 720.) The court examined the plaintiff's evidence to support her claim of malice and concluded it was "clearly . . . insufficient . . . ." (Id. at p. 722.)
We find several aspects of the evidence put forth by the plaintiff in Taus comparable to the evidence that Desmond points to in this case. For example, the Taus court found the plaintiff's denial of the alleged destructive behaviors insufficient to establish the professor's alleged disregard for the truth of that statement, noting in part that the plaintiff's foster mother submitted a declaration which took issue with the professor's conduct in some respects but did not deny making such statements to her. (Taus, supra, 40 Cal.4th at p. 720.) So too here, although Desmond disputes the facts related to her visit with M.S., the declaration submitted by Lacanilao counters any inference that Johnson in particular had a reckless disregard for the truth and misrepresented the factual basis for the hospital's HIPAA finding. As for evidence of the hospital's hostility, we find it no more suggestive of actual malice than the plaintiff's evidence in Taus, which demonstrated the professor's "strongly held views" disagreeing with the methodology of the scholarly article (id. at p. 722), her "persistence in investigating the soundness of the . . . article despite [the] plaintiff's objections" (ibid.), and the professor's "acknowledged displeasure" with an ethical complaint that the plaintiff had filed against her (ibid.). Given the court's conclusion in Taus that the circumstances relied upon by the plaintiff fell "far short of providing an adequate basis for finding" that the professor had acted with actual malice (ibid.), we do not believe the evidence here creates a triable issue of material fact on the issue of malice.
Two other cases that provide a useful point of comparison are Mamou and Cornell. In both cases, there were triable issues of material fact as to actual malice based at least in part on evidence from which the factfinder could reasonably infer that the individuals making the challenged statements knew the information they shared was false. (See Mamou, supra, 165 Cal.App.4th at pp. 729-730 [listing evidence that the statements' author had made repeated, groundless accusations against the plaintiff and had tried to convince others to shun the plaintiff and make additional false statements]; Cornell, supra, 18 Cal.App.5th at p. 951 [concluding there was a triable issue of actual malice concerning whether certain board members actually believed the plaintiff had committed the misconduct (planting a recording device at a board meeting) they described in their statements to club members].) In contrast with Mamou and Cornell there is no evidence in this case to support an inference that the author of the January 28 notice of intended discipline did not believe the assertions in the notice, or that the other hospital administrators who discussed the reasons for Desmond's termination knew the information was false or inaccurate.
We conclude that there are no triable issues of fact concerning whether the challenged statements were subject to the common interest privilege and were made without malice. The common interest privilege thus serves as a complete defense to Desmond's defamation cause of action. (Brown, supra, 48 Cal.3d at p. 723, fn. 7.)
III. DISPOSITION
The judgment is affirmed. The hospital is entitled to recover its costs on appeal.
/s/_________
Premo, J. WE CONCUR: /s/_________
Greenwood, P.J. /s/_________
Elia, J.