Order Submitted Matter

Cal. Super. - 6th Dist.October 26, 2020

KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO SUPERIOR COURT OF CALIFORNIA COUNTY OF SANTA CLARA TIFFANY DREYER, Case N0.: 20CV372730 Plaintiff, ORDER CONCERNING DEFENDANT AUTOMATION V. ANYWHERE, INC.’S DEMURRER TO PLAINTIFF TIFFANY DREYER’S AUTOMATION ANYWHERE, INC., et a1., FIRST AMENDED COMPLAINT AND MOTION TO STRIKE PORTIONS OF Defendants. THE FIRST AMENDED COMPLAINT Plaintiff Tiffany Dreyer brings individual claims for gender discrimination and retaliation against Defendant Automation Anywhere, Inc. (“AAI”), along with related claims under the Private Attorneys General Act (“PAGA”) and Unfair Competition Law (“UCL”). Before the Court are AAI’s: (1) demurrer t0 the PAGA and UCL claims; and (2) motion t0 strike allegations related t0 the PAGA claim. Ms. Dreyer opposes both motions. The Court issued a tentative ruling and heard oral argument 0n May 27, 2021. It now issues its final order, which OVERRULES the demurrer and DENIES the motion t0 strike. I. BACKGROUND As alleged in the operative First Amended Complaint (“FAC”), AAI is a Silicon Valley- based company whose software products combine traditional robotic process automation with cognitive elements such as natural language processing and reading unstructured data. (FAC, 1] ORDER ON SUBMITTED MATTER Electronically Filed by Superior Court of CA, County of Santa Clara, on 6/1/2021 10:16 AM Reviewed By: R. Walker Case #20CV372730 Envelope: 6551980 KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO 7.) Although it markets itself as a start-up company, AAI has existed since 2010 and its customers have included Google, Linkedln, and GM. (Ibid) A. Ms. Dreyer’s Experience Ms. Dreyer started working for AAI 0n June 26, 2019, with the title 0f “Creative Director.” (FAC, 1] 21 .) She initially received an annual salary 0f $185,000, which was increased t0 $ 1 91,000 in November 2019, after she received a stellar performance review from her then-female supervisor. (Ibid) Ms. Dreyer’s job duties included building and managing an in-house creative content team responsible for graphic design, motion graphics, and Video production work, in addition t0 art direction 0f global support agencies. (Ibid) Not long after Ms. Dreyer was hired, AAI brought in a new Chief Marketing Officer, Riadh Dridi. (FAC, 1] 22.) Within a few months, Mr. Dridi launched a restructuring campaign, which included layoffs and power shifting. (Ibid) Although AAI claimed that these changes were due t0 the COVID-19 pandemic, the reorganization allegedly was an excuse t0 push out senior and mid-level female employees, including Ms. Dreyer, and t0 replace them with men. (Ibid) Included among initial layoffs were Ms. Dreyer’s former supervisor and two female Vice Presidents. (FAC, 1] 23.) Meanwhile, in March 2020, AAI demoted Ms. Dreyer and stripped her 0f her management responsibilities, even though she had excelled at her job. (161., 1] 21.) AAI lead Ms. Dreyer t0 believe that a new Vice President would replace her supervisor and would help her build up her team. (Id, 1] 24.) Instead, it brought in a man t0 replace Ms. Dreyer: Mr. Dridi hired one of his former colleagues, Michael Baumert, and put him in an almost identical position t0 Ms. Dreyer, with the title “Director 0f Creative Services.” (Ibid) Apart from some additional experience in the technical industry, Mr. Baumert had the equivalent experience and education as Ms. Dreyer. (119121.) But Ms. Dreyer is informed and believes that AAI paid him a higher salary than her. (Ibid) Beginning in February and early March 2020, Ms. Dreyer reported her concerns about AAI’S toxic and biased workplace culture and about being discriminated against t0 the Senior Vice President 0fHuman Resources. (See FAC, W 25-27.) This senior Vice president could not KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO allay her fears about retaliation and told her it was not the first time he had received such complaints about upper management. (See ibid.) In June 2020, Ms. Dreyer was notified that she was being laid off. (Id., 1] 28.) B. Pattern and Practice 0f Discrimination and Retaliation Ms. Dreyer alleges that AAI engaged in a pattern and practice 0f discriminating against her and other aggrieved female employees by systematically paying them less in wages and bonuses than male employees and disparately targeting them for layoffs and hostile, demeaning treatment. (FAC, 1] 13.) Specifically, male employees in Director positions are regularly paid upwards 0f $200,000 per year as a starting salary, while similarly situated women in this position (including Ms. Dreyer) received at least ten t0 fifteen thousand dollars less. (Id., 1] 14.) There supposedly is a similar wage disparity between male and female Mangers, Senior Managers, and Vice Presidents, particularly in the Marketing Department(s). (Ibid) Ms. Dreyer is aware 0f at least one instance where a female Director made, and is making, a significantly lower wage than a male employee with less experience in a lower ranked Senior Manager position. (Ibid, 1] 15.) There are also significantly fewer women than men working for AAI: Ms. Dreyer estimates that the workforce is seventy percent male, a disparity that is even more pronounced in the Executive and Vice President positions, where females occupy less than five percent 0f positions. (Id, 1] 16.) And since layoffs in April and June 2020 targeted many higher-level female employees, this gender disparity has only become more pronounced. (Ibid) AAI’S workplace culture is also toxic and demeaning towards women. (FAC, 1] 17.) Despite meeting the objective standards set out in Obj ective and Key Results, women are given poor performance ratings and pushed out 0f the company. (Ibid) In fact, during a summer 2020 roundtable discussion for female professionals, one 0f AAI’S top executives suggested-behind a veil 0f concern over the work/life balance for working women with children in the Covid-19 era-that women may want t0 consider the option 0f reducing their hours and taking a pay reduction. (161., 1] 18.) This “suggestion” was not put forth t0 male employees. (Ibid) Over the last siX-plus months, Ms. Dreyer and other aggrieved employees filed ethics complaints and reports with AAI, raising concerns about wage disparity and a disparity in KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO treatment between male and female employees. (FAC, 1] 19.) Specifically, Ms. Dreyer and aggrieved employees reported: (1) they were unjustly receiving negative performance ratings in early 2020; (2) they did not receive earned bonus payments; (3) they were having their job duties removed from them in favor 0f male counterparts; (4) they were being ignored and sabotaged in their efforts t0 complete their job duties; and (5) they regularly did not receive credit for work performed and, in some cases, credit was directly misattributed t0 male co-workers. (Ibid) Their efforts were ignored, and in some cases, their reports were followed by layoffs in April and June 2020. (Id., 1] 20.) C. Claims Asserted in the FAC Based 0n these allegations, Ms. Dreyer asserts the following claims against AAI on an individual basis: (1) Violation 0f California’s Equal Pay Act, (2) retaliation in Violation 0f Labor Code section 1102.5, (3) retaliation in Violation 0f Labor Code section 98.6, (4) discrimination based 0n gender/sex in Violation 0f Government Code section 12490, et seq. (the Fair Employment and Housing Act 0r “FEHA”), (5) retaliation in Violation 0fFEHA, (6) failure t0 prevent discrimination/retaliation in Violation 0fFEHA, and (7) wrongful discharge in Violation 0f public policy. In addition, Ms. Dreyer brings (8) a representative claim under PAGA for Violation 0f Labor Code sections 1197.5 (the California Fair Pay Act), 1102.5, and 98.6; and (9) a claim for unfair competition under the UCL. II. EVIDENTIARY ISSUES AAI’S obj ections t0 the declaration by Ms. Dreyer submitted in support 0f her opposition are SUSTAINED, as the Court does not consider evidence beyond the pleadings and matters subject t0 judicial notice in connection with the motions at issue.1 1 At the May 27, 2021 hearing, AAI asked the Court t0 remove this evidence 0r some portion 0f it from the record, which the Court declined t0 d0 absent a noticed motion. As stated at the hearing, the Court grants AAI permission t0 file a motion t0 remove this evidence from the public file 0r t0 seal it. The parties should negotiate a briefing schedule and contact the Complex Coordinator t0 schedule a hearing date. KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO III. DEMURRER AAI demurs t0 Ms. Dreyer’s PAGA cause 0f action 0n the grounds that it is unmanageable and fails t0 state a claim, and t0 her UCL claim 0n the ground that Ms. Dreyer cannot pursue such a claim where she has an adequate remedy at law. (Code CiV. Proc., § 430.10, subd. (6).) A. Legal Standard The function 0f a demurrer is t0 test the legal sufficiency 0f a pleading. (Trs. ofCapital Wholesale Elec. Etc. Fund v. Shearson Lehman Bros. (1990) 221 Cal.App.3d 617, 621 .) Consequently, “[a] demurrer reaches only t0 the contents 0f the pleading and such matters as may be considered under the doctrine ofjudicial notice.” (South Shore Land C0. v. Petersen (1964) 226 Cal.App.2d 725, 732, internal citations and quotations omitted; see also Code CiV. Proc., § 430.30, subd. (a).) “It is not the ordinary function 0f a demurrer t0 test the truth 0f the plaintiff’s allegations 0r the accuracy with which he describes the defendant’s conduct. Thus, the facts alleged in the pleading are deemed t0 be true, however improbable they may be.” (Align Technology, Inc. v. Tran (2009) 179 Cal.App.4th 949, 958, internal Citations and quotations omitted.) In ruling on a demurrer, the allegations 0f the complaint must be liberally construed, with a View t0 substantial justice between the parties. (Glennen v. Allergan, Inc. (2016) 247 Cal.App.4th 1, 6.) Nevertheless, while “[a] demurrer admits all facts properly pleaded, [it does] not [admit] contentions, deductions 0r conclusions 0f law 0r fact.” (George v. Automobile Club ofSouthern California (201 1) 201 Cal.App.4th 1112, 1120.) A demurrer will succeed where the allegations and matters subject t0 judicial notice clearly disclose a defense 0r bar t0 recovery. (Casterson v. Superior Court (2002) 101 Cal.App.4th 177, 183.) B. The PAGA Claim 1. Manageability AAI argues that Ms. Dreyer’s PAGA claims are inherently unmanageable, and urges the Court t0 follow unpublished federal authorities that have dismissed PAGA claims 0n the pleadings 0n this basis. But California authorities hold that a PAGA representative action is not KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO a class action and is not subject t0 the same manageability requirements as a class action? (See Arias v. Superior Court (2009) 46 Cal.4th 969 [an employee need not satisfy class action requirements t0 bring a representative action under PAGA]; Williams v. Superior Court (Williams) (2017) 3 Cal.5th 531, 551 [“That the eventual proper scope 0f a putative representative action is as yet uncertain is n0 obstacle t0 discovery; a party may proceed with [discovery] precisely in order t0 ascertain that scope.”].) As explained by the California Supreme Court in Williams, under PAGA, [s]uit may be brought by any “aggrieved employee” (Lab. Code, § 2699, subd. C 9 (a)); in turn, an “aggrieved employee” is defined as “any person who was employed by the alleged Violator and against whom one 0r more 0f the alleged Violations was committed” (id., subd. (c), italics added). If the Legislature intended t0 demand more than mere allegations as a condition t0 the filing 0f suit 0r preliminary discovery, it could have specified as much. That it did not implies n0 such heightened requirement was intended. (Williams, supra, 3 Cal.5th at p. 546.) AAI cites unpublished cases in which federal courts have stricken PAGA claims as unmanageable, but these cases predate Williams and conflict with better-reasoned federal authorities holding that it is improper to strike a PAGA claim for failure 2 AAI Cites Dailey v. Sears, Roebuck & C0. (2013) 214 Cal.App.4th 974 (Dailey) for the proposition that “where overtime and meal and rest period claims were not suitable for class treatment, PAGA claims based 0n the same factual allegations could not stand.” But Dailey merely affirmed a trial court’s denial 0f class certification, observing in a footnote that “because Dailey’s remaining claims,” including a PAGA claim, “are all derivative 0f his main claims ..., we need not address separately the suitability 0fth0se claimsfor class certification.” (Id. at p. 1002, fn. 13, italics added.) Dailey was decided 0n evidence-based motions addressed t0 the issue 0f class certification. This highlights that, even in class actions, manageability and other issues relevant t0 class certification are typically not decided 0n the pleadings. (See Tellez v. Rich Voss Trucking, Inc. (2015) 240 Cal.App.4th 1052, 1062 [“Class certification is generally not decided at the pleading stage 0f a lawsuit. The preferred course is t0 defer decision 0n the propriety 0f the class action until an evidentiary hearing has been held 0n the appropriateness 0f class litigation.”], internal citations and quotations omitted.) KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO t0 satisfy a purported manageability requirement. (See Zackaria v. Wal-Mart Stores, Inc. (C.D. Cal. 2015) 142 F.Supp.3d 949, 958-960 (Zackaria) [collecting cases].) AAI correctly points out that the FAC defines “Aggrieved Employees” in a very broad manner, as “[a]ll 0f AAI’S Califomia-based, female employees who have 0r continue t0 work for AAI from August 19, 2019 t0 the date judgement is entered.” (FAC, 1] 4.) This definition is not only broad, but is almost certainly overbroad: under PAGA, the “aggrieved employees” are those who actually suffered one 0f the Violations at issue, not everyone who might have. (See Lab. Code § 2699, subd. (c) [“For purposes 0f this part, ‘aggrieved employee’ means any person who was employed by the alleged Violator and against whom one 0r more 0f the alleged Violations was committed.”].) But there is n0 California authority imposing a requirement that a PAGA plaintiff define “aggrieved employees” with specificity at the pleading stage.3 AAI asserts that it has hundreds 0f female employees, but this is not an appropriate subject ofjudicial notice in the demurrer context. Finally, AAI is correct that it must be permitted t0 present a full defense at trial, but how t0 accomplish this is an issue for another day: it is far too early t0 declare that providing a fair trial in this case would be impossible simply because a high number 0f potentially aggrieved employees are involved. While the Court recognizes AAI’S legitimate concerns about the manageability 0f the specific claims at issue, it can seek Court intervention t0 address these concerns as the case proceeds. For example, discovery must be reasonable and proportional, and may be restricted upon a showing 0f undue burden 0r expense. (See, e.g., Code CiV. Proc., § 2019.030, subd. (a)(2) [court shall restrict discovery that is “unduly burdensome 0r expensive, taking into account the needs 0f the case, the amount in controversy, and the importance 0f the issues at stake in the 3 In USS-Posco Industries v. Case (2016) 244 Cal.App.4th 197, the court observed that a purported PAGA claim would be subject t0 a demurrer 0r motion t0 strike where the complaint “does not allege compliance with 0r even reference PAGA’S exhaustion requirements (§ 2699.3), does not specify which alleged Labor Code Violations underlie the supposed PAGA claim, and t0 the extent it alleges a representative class action, does so under the traditional rubric 0f Code 0f Civil Procedure section 382.” (Id. at p. 222.) These extreme deficiencies are not present here, and this case does not suggest a requirement that a PAGA plaintiff define the “aggrieved employees” impacted by the defendant’s practices at the pleading stage. KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO litigation”].) The Court also has the ability t0 order Ms. Dreyer t0 submit a trial plan at the appropriate juncture. (See Zackaria, supra, 142 F.Supp.3d at p. 960.) But the Court is not authorized t0 simply strike 0r dismiss claims that may be difficult t0 manage 0r prove, be they PAGA claims 0r any other claims not subject t0 the unique requirements imposed in class actions. 2. Factual Specificity AAI also demurs t0 the PAGA claim 0n the ground that Ms. Dreyer alleges n0 facts t0 support the conclusion that all female employees (0r even some 0f them) suffered the Violations at issue. But “[t]0 survive a demurrer, the complaint need only allege facts sufficient t0 state a cause 0f action; each evidentiary fact that might eventually form part 0f the plaintiff” s proof need not be alleged.” (CA. v. William S. Hart Union High School Dist. (2012) 53 Cal.4th 861, 872 [identities 0f allegedly negligent employees need not be provided t0 state a claim against school district].) With limited exceptions not applicable here, the rules 0f pleading require n0 more than “general allegation[s] 0f ultimate fact.” (Birke v. Oakwood Worldwide (2009) 169 Cal.App.4th 1540, 1548 [allegation that asserted nuisance “affect[s] a substantial number 0f people at the same time” suffices t0 state a claim although it mirrors the element 0f the claim].) “The pleading is adequate so long as it apprises the defendant 0f the factual basis for the claim.” (Id. at p. 1549.) Here, Ms. Dreyer clearly alleges that she was not the only one who experienced discrimination and retaliation. As AAI acknowledges,4 she provides fairly specific details in support 0f her Fair Pay Act claim with regard t0 certain positions. (See FAC, W 13-15.) And Ms. Dreyer alleges that other female employees were laid off after making complaints about systematic discrimination. (Id,W 19-20.) These allegations state a claim under PAGA. (See Williams, supra, 3 Cal.5th at p. 551.) 4 AAI allows that “[a]t most, Plaintiff has alleged that AAI’S female employees employed in AAI’S marketing department as ‘Managers, Senior Managers, and Vice Presidents’ suffered CEPA Violations. FAC at 1] 14.” KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO C. The UCL Claim Finally, AAI urges that Ms. Dreyer cannot seek equitable reliefunder the UCL where she has an adequate remedy at law in the form 0f various other statutory remedies. But the UCL’S remedies “are cumulative t0 each other and t0 the remedies 0r penalties available under all other laws 0f this state.” (Bus. & Prof. Code, § 17205.) In addition, “[i]njunctive relief under the UCL is an appropriate remedy where a business has engaged in an unlawful practice 0f discriminating” against certain types 0f workers. (Herr v. Nestle U.S.A., Inc. (2003) 109 Cal.App.4th 779, 782 [Herr].) The Herr court specifically upheld a post-trial UCL-based injunction against discrimination against a class 0f workers, even though the lawsuit was an individual action, not a class action. Here, Ms. Dreyer has alleged gender discrimination and potential retaliation as bases for her UCL claim, which seeks, among other things, injunctive relief. (See FAC, W 82, 84.) Under Herr, these allegations justify the pleading of injunctive relief under the UCL. AAI’S authorities are not t0 the contrary. (See Prudential Home Mortgage C0. v. Superior Court (1998) 66 Cal.App.4th 1236, 1249-1250 [non-UCL case holding specific statutory relief as t0 title precluded different equitable relief]; Sonner v. Premier Nutrition Corp. (9th Cir. 2020) 971 F.3d 834, 842, 845 [under federal law, equitable restitution is unavailable under the UCL where an adequate legal remedy exists; emphasizing that “[i]njunctive relief [was] not at issue” in that case].) And t0 the extent AAI is attempting t0 eliminate only one type of relief sought by this claim, filing a demurrer is the wrong way t0 d0 it. On reply, AAI changes course t0 argue that Ms. Dreyer lacks standing t0 seek injunctive relief because she is n0 longer employed by AAI. But AAI cites n0 authority t0 support the conclusion that a former employee lacks standing under the UCL. T0 the contrary, “t0 have standing t0 bring a claim under the UCL after the 2004 amendments, a plaintiff must be able t0 show he personally sustained economic harm and that he lost money 0r property caused by the defendant’s misconduct.” (California Medical Assn. v. Aetna Health ofCalifornia Inc. (Apr. 28, 2021, N0. B304217) _Cal.App.5th_, 2021 Cal. App. LEXIS 357, at *10.) Ms. Dreyer has KOOONONUl-hwwu-t NNNNNNNNNHHHHHHHHHH OONONM-PWNHOKOOONONm-PWNHO made those allegations. Nothing in this above-described standard requires that the parties’ relationship be ongoing. D. Conclusion For the reasons discussed above, the Court OVERRULES AAI’S demurrer in its entirety. III. MOTION TO STRIKE “The court may, upon terms it deems proper,” strike out “irrelevant, false 0r improper” matters from a complaint. (See Code CiV. Proc, § 436, subd. (a).) Irrelevant matter includes (1) an allegation that is not essential t0 the statement 0f a claim 0r defense, (2) an allegation that is neither pertinent t0 nor supported by an otherwise sufficient claim 0r defense, and (3) a demand for judgment requesting relief not supported by the allegations 0f the complaint 0r cross-complaint. (See id., § 43 1 . 10, subds. (b), (0).) The motion “is traditionally used t0 reach pleading defects that are not subject t0 demurrer” because they impact only a portion 0f a cause 0f action. (CLD Construction, Inc. v. City ofSan Ramon (2004) 120 Ca1.App.4th 1141, 1146.) As with a demurrer, the policy 0f the law is t0 construe the pleadings liberally with a View t0 substantial justice. (See Code CiV. Proc, § 452.) The allegations in the complaint are considered in context and presumed t0 be true. (See Clauson v. Superior Court (1998) 67 Ca1.App.4th 1253, 1255.) Here, AAI moves t0 strike allegations related t0 the retaliation theory supporting Ms. Dreyer’s PAGA claim. It argues that Ms. Dreyer’s allegations pertain only t0 her own individual experience. But as discussed above, Ms. Dreyer specifically alleges that other employees were also laid off for complaining 0f discrimination. (See, e.g., FACw 19-20.) The Court accordingly DENIES the motion t0 strike. IT IS SO ORDERED. Date: The Honorable Sunil R. Kulkarni Judge 0f the Superior Court 10 June 1, 2021