Melvin Glapion v. Kroll Associates Inc. et al

NOTICE OF MOTION AND MOTION to Dismiss and to Strike Plaintiff's Second Amended Complaint

C.D. Cal.August 11, 2016

NOTICE OF MOTION AND PARTIAL MOTION TO DISMISS AND STRIKE PLAINTIFF’S COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 LYNNE C. HERMLE (STATE BAR NO. 99779) lchermle@orrick.com MEGAN M. LAWSON (STATE BAR NO. 294397) megan.lawson@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 1000 Marsh Road Menlo Park, California 94025 Telephone: 650-614-7400 Facsimile: 650-614-7401 RENEE B. PHILLIPS (pro hac vice) rphillips@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 51 West 52nd Street New York, New York 10019-6142 Telephone: 212-506-5000 Facsimile: 212-506-5151 MARK MERMELSTEIN (STATE BAR NO. 208005) mmermelsein@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 777 South Figueroa Street, Suite 3200 Los Angeles, California 90017 Telephone: 213-629-2020 Facsimile: 213-612-2499 Attorneys for Defendant KROLL ASSOCIATES, INC. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation, Defendant. Case No. 2:16-CV-00828-FMO-AJW NOTICE OF MOTION AND PARTIAL MOTION TO DISMISS AND TO STRIKE PLAINTIFF’S SECOND AMENDED COMPLAINT BY DEFENDANT KROLL ASSOCIATES, INC. Date: September 8, 2016 Time: 10:00 am Courtroom: 22-5th Floor Judge: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 42 Filed 08/11/16 Page 1 of 4 Page ID #:444 OHSUSA:764527462.1 1 NOTICE OF MOTION AND PARTIAL MOTION TO DISMISS AND STRIKE PLAINTIFF’S COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 NOTICE OF MOTION AND MOTION TO THE U.S. DISTRICT COURT FOR THE CENTRAL DISTRICT OF CALIFORNIA, AND TO ALL PARTIES AND THEIR COUNSEL OF RECORD: PLEASE TAKE NOTICE that on Thursday, September 8, 2016 at 10:00 a.m., in the United States District Court for the Central District of California, located at 255 East Temple Street, Los Angeles, CA 90012-3332, or as soon thereafter as the matter may be heard, before the Honorable Fernando M. Olguin, Defendant Kroll Associates, Inc., will and hereby does move for an order partially dismissing Dkt Entry 39 (Plaintiff’s Second Amended Complaint) pursuant to Federal Rules of Civil Procedure 12(b)(1), 12(b)(6), and 12(f). This Motion is based upon this Notice and Motion, the supporting Memorandum of Points and Authorities, the Declaration of Megan M. Lawson and exhibits attached thereto, any Reply brief filed in support, the papers on file, oral argument, and any other matters that the Court may consider. Specifically, Defendants ask that the Court dismiss Counts 1-5 and 7-9 under 12(b)(6) and/or 12(b)(1) because Plaintiff’s Second Amended Complaint still fails to state a claim upon which relief may be granted for the reasons discussed herein. Plaintiff’s sexual orientation claim (Count 1) fails because his allegation that subordinates made anti-gay comments is insufficient to demonstrate that any decision makers harbored discriminatory animus or terminated Plaintiff for discriminatory reasons. Plaintiff’s harassment claim (Count 2) alleges conduct that was not directed at him and that does not approach the level of severity or pervasiveness to constitute actionable harassment. His race discrimination claim (Count 3) consists of nothing more than conclusory allegations that must be disregarded under Iqbal and Twombly, leaving nothing for the Court to consider. Plaintiff’s retaliation claim (Count 4) fails to allege facts sufficient to show that he engaged in legally protected activity prior to Kroll Associates, Inc.’s decision to Case 2:16-cv-00828-FMO-AJW Document 42 Filed 08/11/16 Page 2 of 4 Page ID #:445 - 2 - NOTICE OF MOTION AND PARTIAL MOTION TO DISMISS AND STRIKE PLAINTIFF’S COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 terminate him. Because Plaintiff’s underlying claims for discrimination, harassment and retaliation fail, so too does his claim for failure to prevent discrimination, harassment and retaliation (Count 5). Plaintiff’s Sarbanes Oxley claim (Count 7) must be dismissed under Rules 12(b)(1) and 12(b)(6) because Kroll Associates, Inc. is not a covered entity under SOX and because Plaintiff failed to exhaust administrative remedies with respect to his contractor or subcontractor theory. Plaintiff’s claim for violation of the Dodd- Frank Act (Count 8) fails because it relies on his deficient SOX claim. Plaintiff’s defamation claim (Count 9) alleges vague publications made by unidentified persons and two statements by a subordinate, all of which lack the requisite specificity as to whom or when the alleged defamatory publications were made, and therefore fails to meet the heightened pleading standard required to survive a motion to dismiss. Last, Plaintiff’s wrongful termination in violation of public policy claim (Count 10) is in part based on a vague allegation of “noncompliance with federal, state or local regulations” and must be stricken. Statement of Compliance The parties have met and conferred on the issues discussed herein pursuant to Local Rule 7-3 and the Court’s Order Granting Defendants’ Motion to Dismiss (Dkt. Entry 34). Specifically, the parties went through each of the ten claims in the SAC and discussed Defendant’s reasons for moving on each, including the applicable pleading standards to survive a motion to dismiss. Plaintiff filed his Second Amended Complaint (Dkt. Entry 39) to remove Defendants Kroll Inc. and Corporate Risk Holdings LLC, and made a few other small additions. None of those changes are sufficient to save the claims subject to this motion from dismissal. Dated: August 11, 2016 Orrick, Herrington & Sutcliffe LLP By: /s/ Lynne C. Hermle LYNNE C. HERMLE Attorneys for Defendant KROLL ASSOCIATES, INC. Case 2:16-cv-00828-FMO-AJW Document 42 Filed 08/11/16 Page 3 of 4 Page ID #:446 - 3 - NOTICE OF MOTION AND PARTIAL MOTION TO DISMISS AND STRIKE PLAINTIFF’S COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Case 2:16-cv-00828-FMO-AJW Document 42 Filed 08/11/16 Page 4 of 4 Page ID #:447 OHSUSA:765584091.4 MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 LYNNE C. HERMLE (STATE BAR NO. 99779) lchermle@orrick.com MEGAN M. LAWSON (STATE BAR NO. 294397) megan.lawson@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 1000 Marsh Road Menlo Park, California 94025 Telephone: 650-614-7400 Facsimile: 650-614-7401 RENEE B. PHILLIPS (pro hac vice) rphillips@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 51 West 52nd Street New York, New York 10019-6142 Telephone: 212-506-5000 Facsimile: 212-506-5151 MARK MERMELSTEIN (STATE BAR NO. 208005) mmermelsein@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 777 South Figueroa Street, Suite 3200 Los Angeles, California 90017 Telephone: 213-629-2020 Facsimile: 213-612-2499 Attorneys for Defendant KROLL ASSOCIATES, INC. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation, Defendant. Case No. 2:16-CV-00828-FMO-AJW MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF PARTIAL MOTION TO DISMISS AND TO STRIKE PLAINTIFF’S SECOND AMENDED COMPLAINT BY DEFENDANT KROLL ASSOCIATES, INC. Date: September 8, 2016 Time: 10:00 am Courtroom: 22-5th Floor Judge: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 1 of 28 Page ID #:448 TABLE OF CONTENTS Page OHSUSA:765584091.4 i MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. INTRODUCTION AND STATEMENT OF ISSUES .................................... 1 II. FACTUAL ALLEGATIONS IN THE SAC ................................................... 1 A. Plaintiff’s Employment with Kroll ....................................................... 2 B. Alleged Discrimination and Harassment .............................................. 2 C. Plaintiff’s Termination for Misconduct ................................................ 4 III. RELEVANT PROCEDURAL HISTORY ...................................................... 4 A. Administrative Charges......................................................................... 4 B. Court Proceedings ................................................................................. 5 IV. ARGUMENT .................................................................................................. 6 A. Legal Standards ..................................................................................... 6 B. Eight of Plaintiff’s Ten Claims Are Deficient and Should Be Dismissed .............................................................................................. 7 1. Plaintiff Fails to State a Claim for Sexual Orientation Discrimination ............................................................................ 7 2. Plaintiff’s Harassment Claim is Fatally Flawed as a Matter of Law ............................................................................. 8 3. Plaintiff Fails to State a Claim for Race Discrimination .......... 10 4. Plaintiff Fails to State a Claim for FEHA Retaliation .............. 10 5. Plaintiff Fails to State a “Failure to Prevent” Claim Under FEHA ........................................................................................ 12 6. Plaintiff’s Sarbanes Oxley Retaliation Claim Fails Under Rules 12(b)(1) and/or 12(b)(6) ................................................. 12 a. Kroll Is Not A Covered Company Under SOX ............. 13 (1) Failure to Exhaust “Contractor or Subcontractor” Claim ........................................... 13 (2) Failure to Demonstrate Jurisdiction And/Or State a Claim ........................................................ 14 (a) Lawson v. FMR LLC Does Not Apply Here ............................................................ 15 (b) Plaintiff’s Claim Fails ................................ 17 7. Plaintiff Fails to State a Claim of Dodd-Frank Retaliation ...... 18 8. Plaintiff’s Defamation Claim is Wholly Vague and Defective ................................................................................... 18 C. Plaintiff’s Claim for Wrongful Termination in Violation of Public Policy Should be Stricken ........................................................ 20 V. CONCLUSION ............................................................................................. 21 Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 2 of 28 Page ID #:449 OHSUSA:765584091.4 ii MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES Page(s) Federal Cases Anthony v. Nw. Mut. Life. Ins. Co., 2015 U.S. Dist. LEXIS 118961 (N.D.N.Y. Sep. 8, 2015) ...................... 14, 16, 17 Ashcroft v. Iqbal, 556 U.S. 662 (2009) .................................................................................. 1, 6, 8, 9 Associated Gen. Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519 (1983) .............................................................................................. 7 Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) .............................................................................. 6, 9, 15, 19 Benson v. JP Morgan Chase Bank, N.A., 673 F.3d 1207 (9th Cir. 2012) ............................................................................. 12 Curtis v. Century Sur. Co., 320 F. App’x 546 (9th Cir. 2009) ........................................................................ 14 D’Amico v. City of New York, 132 F.3d 145 (2d Cir. 1998) ................................................................................ 15 Fantasy, Inc. v. Fogerty, 984 F.2d 1524 (9th Cir. 1993) ............................................................................. 20 Faragher v. Boca Raton, 524 U.S. 775 (1998) .......................................................................................... 8, 9 Feldman v. Law Enforcement Assocs. Corp., 752 F.3d 339 (4th Cir. 2014) ............................................................................... 12 Flesznar v. U.S. Dep’t of Labor, 598 F.3d 912 (7th Cir. 2010) ......................................................................... 17, 18 Foster v. ScentAir Tech., Inc., 2014 U.S. Dist. LEXIS 80532 (N.D. Cal. June 10, 2014) .................................. 10 Garza v. BNSF Railway Co., 2012 U.S. Dist. LEXIS 80652 (E.D. Cal. June 11, 2012) ................................... 12 Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 3 of 28 Page ID #:450 OHSUSA:765584091.4 - iii - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES (continued) Page(s) Genberg v. Porter, 935 F. Supp. 2d 1094 (D. Colo. 2013) ................................................................ 12 Gibney v. Evolution Mktg. Research, LLC, 25 F. Supp. 3d 741 (E.D. Pa. 2014) ..................................................................... 16 Granillo v. Exide Tech., Inc., 2011 U.S. Dist. LEXIS 130669 (C.D. Cal. May 20, 2011) ................................. 12 Johnson v. Riverside Healthcare Sys., LP, 534 F.3d 1116 (9th Cir. 2008) ............................................................................... 9 Jones v. AIG Risk Mgmt., 726 F. Supp. 2d 1049 (N.D. Cal. 2010)................................................................. 7 Kauffman v. Sidereal Corp., 695 F.2d 343 (9th Cir.1982) ................................................................................ 12 Kennedy v. Kings Mosquito Abatement Dist., 2013 U.S. Dist. LEXIS 37621 (E.D. Cal. Mar. 15, 2013) .............................. 8, 10 Lawson v. FMR LLC, 134 S. Ct. 1158 (2014) ................................................................................. passim Lutzeier v. Citigroup, Inc., 2015 U.S. Dist. LEXIS 28231 (E.D. Mo. Mar. 9, 2015) .................................... 14 McCleary-Evans v. Maryland Dept. of Transp., State Highway Admin., 780 F.3d 582 (4th Cir. 2015) ............................................................................... 10 Moss v. U.S. Secret Serv., 572 F.3d 962 (9th Cir. 2009) ................................................................................. 6 Newman v. Metro. Life Ins. Co., 2015 U.S. Dist. LEXIS 7271 (D. Mass. Jan. 21, 2015) ...................................... 14 Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 4 of 28 Page ID #:451 OHSUSA:765584091.4 - iv - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES (continued) Page(s) Raad v. Fairbanks N. Star Borough Sch. Dist., 323 F.3d 1185 (9th Cir. 2003) ............................................................................. 11 Raytheon Co. v. Hernandez, 540 U.S. 44 (2003) ................................................................................................ 7 Sanchez v. City of Santa Ana, 936 F.2d 1027 (9th Cir. 1990) ............................................................................... 9 Savage v. Glendale Union High Sch., 343 F.3d 1036 (9th Cir. 2003) ......................................................................... 7, 15 Sidney-Vinstein v. A.H. Robins Co., 697 F.2d 880 (9th Cir. 1983) ............................................................................... 20 Smith v. Corning Inc., 2007 U.S. Dist. LEXIS 52959 (W.D.N.Y. July 23, 2007) .................................. 14 St. Clair v. City of Chico, 880 F.2d 199 (9th Cir. 1989) ..................................................................... 7, 14, 15 Warwick v. California Dep’t of Corr., 2008 U.S. Dist. LEXIS 97207 (N.D. Cal. Nov. 21, 2008) .................................. 20 Willis v. Vie Fin. Group, Inc., 2004 WL 1774575 (E.D. Pa. Aug. 6, 2004) ........................................................ 12 Wynes v. Kaiser Permanente Hosps., 2011 U.S. Dist. LEXIS 35400 (E.D. Cal. Mar. 31, 2011) .................................. 21 State Cases Baker v. Los Angeles Herald Examiner, 42 Cal. 3d 254 (1986) .................................................................................... 19, 20 Dickson v. Burke Williams, 234 Cal. App. 4th 1307 (2015) ............................................................................ 12 Fisher v. San Pedro Peninsula Hosp., 214 Cal. App. 3d 590 (1989) ................................................................................. 9 Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 5 of 28 Page ID #:452 OHSUSA:765584091.4 - v - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES (continued) Page(s) Gregory v. McDonnell Douglas Corp., 17 Cal. 3d 596 (1976) .......................................................................................... 19 Janken v. GM Hughes Elecs., 46 Cal. App. 4th 55 (1996) .................................................................................. 10 Kelly-Zurian v. Wohl Shoe Co., Inc., 22 Cal. App. 4th 397 (1994) .................................................................................. 8 Lipman v. Brisbane Elementary Sch. Dist. 55 Cal. 2d 224 (1961) .......................................................................................... 19 Reno v. Baird, 18 Cal. 4th 640 (1998) ......................................................................................... 10 Ropes v. Auto-Chlor Sys. of Wash. Inc., 220 Cal. App. 4th 635 (2013) .............................................................................. 11 Savage v. Pac. Gas & Elec. Co., 21 Cal. App. 4th 434 (1993) ................................................................................ 19 Taus v. Loftus, 40 Cal. 4th 683 (2007) ............................................................................. 18, 19, 20 Trujillo v. N. County Transit, 63 Cal. App. 4th 280 (1998) ................................................................................ 12 Turner v. Anheuser-Busch, Inc., 7 Cal. 4th 1238 (1994) ......................................................................................... 21 Wallace v. Tesoro Corp., 796 F.3d 468 (5th Cir. 2015) ............................................................................... 14 Yanowitz v. L’Oreal USA, Inc., 36 Cal. 4th 1028 (2005) ....................................................................................... 11 Federal Statutes 18 U.S.C. § 1514A ............................................................................................. passim Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 6 of 28 Page ID #:453 OHSUSA:765584091.4 - vi - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 TABLE OF AUTHORITIES (continued) Page(s) State Statutes Cal. Civ. Code §§ 45, 46........................................................................................... 18 Cal. Civ Proc. Code 340(c) ....................................................................................... 20 Cal. Code Regs § 11023(a)(2) .................................................................................. 12 Rules Fed. R. Civ. P. 12(b)(1) ..................................................................................... passim Fed. R. Civ. P. 12(b)(6) ................................................................................. 2, 12, 14 Fed. R. Civ. P. 12(f) .............................................................................................. 1, 20 Other Authorities Klawans v. Societe Generale, 2013 DOLSOX LEXIS 36 (ALJ Oct. 23, 2013) ................................................ 13, 14 Plutzer v. U.S. Auto. Ass’n, 2015 DOLSOX LEXIS 15 (ALJ Mar. 24, 2015) ............................................... 14, 16 Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 7 of 28 Page ID #:454 OHSUSA:765584091.4 1 MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I. INTRODUCTION AND STATEMENT OF ISSUES Despite this Court’s Order dismissing Plaintiff’s First Amended Complaint (“FAC”), which instructed Plaintiff to “carefully evaluate the contentions set forth in defendants’ Motion” in amending his FAC, Plaintiff’s Second Amended Complaint (“SAC”) (Dkt. Entry 39) fails to address most of the critical issues raised in Defendant’s first Motion to Dismiss. In fact, other than removing parties who never should have been named in the first place (Dkt. Entry 38), the SAC remains virtually unchanged from the FAC, maintaining all nine claims that were the subject of Defendant’s first Motion to Dismiss. The SAC contains no new allegations with respect to Plaintiff’s claims of race discrimination, FEHA retaliation and violation of the Sarbanes-Oxley and Dodd-Frank Acts. See Declaration of Megan M. Lawson (“Lawson Decl.”), Ex. 1 (SAC). Where Plaintiff has added allegations, they consist of nothing more than his own conclusory interpretations of events. In addition, the meet and confer process that the Court mandated in its Order was fully followed and confirmed the uncured fatal deficiencies in the SAC. See Lawson Decl. ¶¶5-17. Simply put, Plaintiff has failed to allege any new facts that, if proven, would push Counts 1-5 and 7-10 “across the line from conceivable to plausible.” Ashcroft v. Iqbal, 556 U.S. 662, 680 (2009). This is despite three chances to do so. Counts 1-5 and 7-9 should therefore be dismissed with prejudice pursuant to FRCP 12(b)(1) and/or 12(b)(6) and Count 10 should be stricken pursuant to FRCP 12(f). II. FACTUAL ALLEGATIONS IN THE SAC1 A. Plaintiff’s Employment with Kroll At all times relevant to the SAC, Plaintiff worked for Kroll Associates, Inc. (“Kroll”) in Los Angeles as a Managing Director and Office Head. SAC ¶12. As head of the Los Angeles office, Plaintiff held the highest position in that office with 1 Kroll treats Plaintiff’s factual allegations as true for purposes of this motion to the extent required by Rule 12(b)(6); however, Kroll vehemently denies all allegations of wrongdoing in the SAC. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 8 of 28 Page ID #:455 OHSUSA:765584091.4 - 2 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 sensitive duties, including supervising and terminating Kroll Los Angeles employees and reorganizing the office. SAC ¶¶12, 13. B. Alleged Discrimination and Harassment Plaintiff alleges the following acts occurred while he was Kroll’s Los Angeles Office Head: • Management supported Plaintiff’s recommendation to terminate three employees, but when he recommended an additional termination of a “straight white male” subordinate, unidentified managers objected and told him to place the subordinate on a performance improvement plan (SAC ¶14); • Plaintiff adds in his SAC that he “observed that this special standard appeared to exist only for straight white males,” but included no factual allegations to support his observation (See SAC ¶14; Lawson Decl., Ex. 2 ¶14); • An employee in another office interfered (in an unspecified way) on the subordinate’s behalf, resulting in extensions of the performance improvement plan (SAC ¶15); • That same employee stated she was ashamed Plaintiff terminated the subordinate and “implied it was a personal vendetta” (SAC ¶17); • A subordinate under Plaintiff’s supervision stated to an unidentified co-worker on an unspecified date that Plaintiff “was hunting straight white males” who did not fit Plaintiff’s vision of a “gays-only office” (SAC ¶16); • That same subordinate “implied that Plaintiff was dating a male co-worker” (SAC ¶16); • Plaintiff adds in his SAC that these comments by the subordinate “showed a discriminatory motive to oppose Plaintiff’s personnel decisions due to his race and sexual orientation” (see SAC ¶16; Lawson Decl., Ex. 2 ¶16), but this is Plaintiff’s own conclusion, not a factual allegation for purposes of a 12(b)(6) analysis; Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 9 of 28 Page ID #:456 OHSUSA:765584091.4 - 3 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 • Plaintiff discovered, on an unspecified date, emails from unidentified senders containing unspecified “anti-gay comments” (SAC ¶18); • Plaintiff also discovered, on an unspecified date, unspecified emails from unidentified “managers” in unidentified locations that had encouraged the terminated subordinate to ignore the performance improvement plan (SAC ¶18); • Plaintiff adds in his SAC that the unspecified emails “repeatedly made mocking and negative reference to Plaintiff’s sexual orientation,” and discussed Plaintiff’s “sexual orientation in the context of Kroll managers and employees seeking to block Plaintiff’s ability to manage his office” (see SAC ¶18; Lawson Decl., Ex. 2 ¶18), but his characterizations of the alleged emails are not facts2; • As a result of discovering these vaguely characterized “management level emails,” Plaintiff asked unidentified members of Human Resources to schedule telephonic meetings with the authors of the comments, and when this did not happen, he allegedly complained to members of Kroll management but they failed to respond (SAC ¶¶19-20); • Plaintiff adds in his SAC that “HR continued to refuse to conduct an investigation of Plaintiff’s repeated complaints of discrimination” but Plaintiff still fails to include any factual allegations that, if proven, would demonstrate that he actually told HR that he was being discriminated against (see SAC ¶19; Lawson Decl., Ex. 2 ¶19); and • Plaintiff also adds in his SAC that CEO Emanuele Conti “falsely impl[ied] that Plaintiff was seeking to get special treatment because he is a gay man,” but offers no factual allegations which, if proven, would demonstrate that Mr. Conti “implied” this. See SAC ¶20; Lawson Decl., Ex. 2 ¶20. 2 Despite two opportunities to replead, Plaintiff has still not alleged what any purported emails allegedly said. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 10 of 28 Page ID #:457 OHSUSA:765584091.4 - 4 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 • Plaintiff added in his SAC that when he requested an update on the status of his alleged Human Resources complaint, “Carey’s comments indicated that she had not even begun an investigation” and that she would need to “speak to Manny”. SAC ¶23; Lawson Decl. ¶23. From this alleged statement, Plaintiff self-servingly concludes that “Kroll HR was refusing to conduct an investigation because the CEO refused to give them permission to do so.” SAC ¶23; Lawson Decl. ¶23. C. Plaintiff’s Termination for Misconduct On or about June 2, 2015, Kroll learned that Plaintiff was engaged in unauthorized moonlighting activities. SAC ¶22. Plaintiff had been writing investment articles “on the crowd-sourced investment newsletter website Seeking Alpha” under the pseudonym “Mithra Research,” including an article that, among other things, claimed a company named “Vipshop” had misstated its earnings. SAC ¶21. According to Plaintiff, after he learned that Kroll discovered his unauthorized publication of the Vipshop article, Plaintiff disclosed to the CEO that he made an “SEC report” about Vipshop, and previously made an SEC report about another company. SAC ¶22. Kroll investigated and uncovered that Plaintiff had committed multiple violations of Kroll’s written policies when writing these articles, including taking actions that “harmed a client” and misusing company resources. SAC ¶24. Kroll terminated Plaintiff’s employment on June 16, 2015, within two weeks of learning of his unauthorized publication of articles. SAC ¶25. III. RELEVANT PROCEDURAL HISTORY A. Administrative Charges Plaintiff responded to his termination by firing off two separate administrative charges. He filed a Sarbanes-Oxley (“SOX”) complaint with the Occupational Safety and Health Administration (“OSHA”) on September 1, 2015 claiming that he was terminated in retaliation for whistleblowing. See SAC ¶5; Lawson Decl., Ex. 3 (Declaration of Renee Phillips in Support of Defendants’ Partial Motion to Dismiss Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 11 of 28 Page ID #:458 OHSUSA:765584091.4 - 5 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 and to Strike First Amended Complaint (“Phillips Decl.”), Ex. A) (“OSHA Complaint”). He also filed a race discrimination charge with the California Department of Fair Employment and Housing on September 1, 2015. See SAC ¶6; Phillips Decl., Ex. B (“FEHA Charge”). On January 27, 2016, Plaintiff amended his FEHA Charge to add a sexual orientation discrimination charge. Phillips Decl., Ex. C. Plaintiff’s OSHA Complaint did not include many of the allegations that form the basis of his current SOX claim. See OSHA Complaint. On October 20, 2015, OSHA issued a “no reasonable cause” determination and dismissed Plaintiff’s OSHA Complaint on the ground that Kroll is not covered by SOX: “Kroll Associates, Inc. were [sic] not publically [sic] traded companies, or fell within the meaning of 18 U.S.C. § 1514A.” SAC ¶5. Plaintiff filed objections to the determination with the Department of Labor (“DOL”) Office of Administrative Law Judges, but later removed his case from the DOL to proceed in district court. Id. See 18 U.S.C. § 1514A(b)(1)(B). B. Court Proceedings Plaintiff filed his Original Complaint on February 5, 2016 (Dkt. Entry 1). After Kroll met and conferred with Plaintiff, he filed the FAC on March 15, 2016 (Dkt. Entry 20). In the FAC, Plaintiff removed a religious discrimination claim, limited his claims for punitive damages, and added allegations that Plaintiff exhausted administrative remedies under SOX. After further meet and confer efforts, Kroll moved to dismiss nine of the ten causes of action asserted against it in the FAC (Dkt. Entry 26). On May 3, 2016, the Court granted Kroll’s motion to dismiss the FAC with leave to amend. See Dkt. Entry 34. The Court instructed that, “[i]n preparing the second amended complaint, plaintiff shall carefully evaluate the contentions set forth in defendants’ motion.” Id. Plaintiff filed the SAC, which was overwhelmingly similar to his FAC, on July 14, 2016. See Dkt. Entry 39. On August 4, 2016, the parties met and conferred to discuss Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 12 of 28 Page ID #:459 OHSUSA:765584091.4 - 6 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the deficiencies in Plaintiff’s SAC. See Lawson Decl. ¶4. During the parties’ meet and confer conference, Kroll went through each of Plaintiff’s claims and explained in detail why Plaintiff’s factual allegations were insufficient to meet the pleading standards of Bell Atlantic v. Twombly and Ashcroft v. Iqbal. Lawson Decl. ¶¶5-17. Upon exhausting those efforts, Kroll filed the instant motion. IV. ARGUMENT A. Legal Standards To survive a motion to dismiss under 12(b)(6), plaintiff must allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007); see also Ashcroft v. Iqbal, 556 U.S. 662, 697 (2009); Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) (“the non- conclusory ‘factual content,’ and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief”). “[A] plaintiff’s obligation to provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555. Where a complaint pleads facts that are “merely consistent with” a defendant’s liability, it “stops short of the line between possibility and plausibility of ‘entitlement to relief.’” Iqbal, 566 U.S. at 678 (quoting Twombly, 550 U.S. at 557). It is not proper for a court to assume plaintiff can prove facts he has not alleged, or that the defendant has violated laws in ways not alleged. See Twombly, 550 U.S. at 563 n.8 (quoting Associated Gen. Contractors of California, Inc. v. California State Council of Carpenters, 459 U.S. 519, 526 (1983)). This is because “a defendant should not be forced to undergo costly discovery unless the complaint contains enough detail, factual or argumentative, to indicate that the plaintiff has a substantial case.” Jones v. AIG Risk Mgmt., 726 F. Supp. 2d 1049, 1059 (N.D. Cal. 2010) (citations omitted). When a defendant challenges the Court’s subject matter jurisdiction under Rule 12(b)(1), it is the plaintiff’s burden to establish that the Court has such Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 13 of 28 Page ID #:460 OHSUSA:765584091.4 - 7 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 jurisdiction. St. Clair v. City of Chico, 880 F.2d 199, 201 (9th Cir. 1989). The Court may consider affidavits and other extra-pleading material to decide the issue. Id.; Savage v. Glendale Union High Sch., 343 F.3d 1036, 1039 n.2 (9th Cir. 2003). B. Eight of Plaintiff’s Ten Claims Are Deficient and Should Be Dismissed 1. Plaintiff Fails to State a Claim for Sexual Orientation Discrimination Despite three opportunities to plead his claims, Plaintiff’s SAC still falls far short of what is required to demonstrate sexual orientation discrimination. Liability for disparate-treatment claims “depends on whether the protected trait...actually motivated the employer’s decision.” Raytheon Co. v. Hernandez, 540 U.S. 44, 52 (2003) (emphasis added, internal quotations and citation omitted). Here, Plaintiff does not allege a single fact to tie any sexual orientation animus to any decision makers or to his termination. Plaintiff admits that Kroll management employed him in a senior position -- Managing Director -- and promoted him to Los Angeles Office Head, with high level duties including supervising and terminating employees. See SAC ¶¶12-13. Thus, Plaintiff’s own allegations undermine any inference that Kroll decision makers harbored any discriminatory animus towards him. The only facts Plaintiff alleges to suggest any sexual orientation animus relate to a few vague, isolated and hearsay comments from subordinate employees not alleged to be decision makers in his termination. See SAC ¶¶16, 18. 3 Such allegations do not suffice. See, e.g., Kennedy v. Kings Mosquito Abatement Dist., 2013 U.S. Dist. LEXIS 37621 at *26 (E.D. Cal. Mar. 15, 2013) (“The Complaint alleges that Plaintiff suffered racially motivated comments and slurs by co-workers, but there is no allegation that the adverse employment actions …were imposed by anyone who had personally used racial slurs or epithets or had in any other way communicated that racial bias was at the root of the adverse actions.”). 3 Although Plaintiff contends unidentified “managers” encouraged a terminated subordinate (in unspecified ways) to undermine Plaintiff by ignoring performance counseling, Plaintiff alleges no facts linking this to his sexual orientation. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 14 of 28 Page ID #:461 OHSUSA:765584091.4 - 8 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Moreover, Plaintiff’s claim that he was terminated due to his sexual orientation ignores his own misconduct and the exceedingly more plausible (indeed, actual) explanation for his termination: that Kroll discovered his unauthorized publication of articles using Kroll resources that violated multiple company policies and terminated him for that misconduct. See Iqbal, 556 U.S. at 681 (“these allegations are consistent with petitioners’ purposefully designating detainees ‘of high interest’ because of their race, religion, or national origin. But given more likely explanations, they do not plausibly establish this purpose”). For all of these reasons, Plaintiff fails to state a claim of sexual orientation discrimination and the claim should be dismissed. 2. Plaintiff’s Harassment Claim is Fatally Flawed as a Matter of Law Plaintiff’s sexual orientation harassment claim fails for similar reasons. To establish actionable harassment, Plaintiff must plead facts establishing that his workplace was “permeated with discriminatory intimidation, ridicule and insult” which was “sufficiently severe or pervasive to alter the conditions of [his] employment and create an abusive working environment.” Kelly-Zurian v. Wohl Shoe Co., Inc., 22 Cal. App. 4th 397, 409 (1994); see also Faragher v. Boca Raton, 524 U.S. 775, 788 (1998). The “severe or pervasive” standard is necessary to “filter out complaints attacking the ordinary tribulations of the workplace, such as the sporadic use of abusive language, gender-related jokes and occasional teasing.” Faragher, 524 U.S. at 788. Thus, “occasional, isolated, sporadic or trivial” improper acts will not state a harassment claim. Fisher v. San Pedro Peninsula Hosp., 214 Cal. App. 3d 590, 610 (1989); Sanchez v. City of Santa Ana, 936 F.2d 1027, 1031, 1036 (9th Cir. 1990). Here, Plaintiff’s harassment claim hinges entirely on a few vaguely alleged hearsay comments: one subordinate allegedly stated that Plaintiff was “hunting straight white males” who did not fit with his vision of a “gays-only office” and “implied” he was dating a male co-worker, and that Plaintiff reviewed a terminated Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 15 of 28 Page ID #:462 OHSUSA:765584091.4 - 9 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 subordinate’s emails and discovered what Plaintiff characterized as “anti-gay comments” with “mocking and negative reference” to his sexual orientation. SAC ¶¶16, 18. As an initial matter, despite two opportunities to replead, Plaintiff has still not even alleged what any of the purported anti-gay emails said, even in paraphrase form. Rather, he has merely alleged how he interpreted them. Under Iqbal and Twombly, this Court should not blindly accept Plaintiff’s conclusory interpretations as true for purposes of this motion. Iqbal, 556 U.S. at 686 (“the Federal Rules do not require courts to credit a complaint’s conclusory statements without reference to its factual context”); Twombly, 550 U.S. 544 at 555 (“courts are not bound to accept as true a legal conclusion couched as a factual allegation”) (internal quotations omitted). Plaintiff’s claim should be rejected for this reason alone. But in addition, none of the alleged statements in these unspecified emails were directed at Plaintiff and, coupled with their isolated (and, in the case of the alleged emails, unspecified) nature, they are plainly insufficient to state a claim for harassment. See Johnson v. Riverside Healthcare Sys., LP, 534 F.3d 1116, 1122 (9th Cir. 2008) (“the Committee members’ conduct was not directed at Johnson, and he alleges that he only learned about it indirectly.…isolated incidents, unless ‘extremely serious,’ are insufficient to state a claim for hostile work environment”); Fisher, 214 Cal. App. 3d at 610 (sustaining demurrer: “Even at the pleading stage, such allegations are simply not sufficient to establish a cause of action for environmental sexual harassment since none of the acts were directed at [plaintiff]”).4 Because Plaintiff has failed to allege either “severe” or “pervasive” harassment directed at him, his claim should be dismissed for this reason as well. 4 To the extent Plaintiff attempts to bolster his claim by alleging that Human Resources failed to respond to telephone inquiries, see SAC ¶¶19-20, such conduct does not fall within the definition of harassment. See, e.g., Reno v. Baird, 18 Cal. 4th 640, 645-46 (1998) (citing Janken v. GM Hughes Elecs., 46 Cal. App. 4th 55, 62-63 (1996)); Foster v. ScentAir Tech., Inc., 2014 U.S. Dist, LEXIS 80532, at *10 (N.D. Cal. June 10, 2014) (dismissing harassment claim because plaintiff “only allege[d] that [plaintiff’s supervisor] failed to take corrective action in response to another employee’s racially insensitive remark”). Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 16 of 28 Page ID #:463 OHSUSA:765584091.4 - 10 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 3. Plaintiff Fails to State a Claim for Race Discrimination Despite two opportunities to replead, nowhere in Plaintiff’s SAC does he allege a single fact to tie racial animus to the decision makers for his termination. In fact, the issue of race is only raised in the SAC when Plaintiff alleges that when he sought to terminate an underperforming subordinate (who happened to be white), unspecified members of management objected and he was instructed to prepare a performance improvement plan for the subordinate instead. SAC ¶14. Of course, such allegations are plainly insufficient to state a claim that Kroll terminated Plaintiff because he is Black. See, e.g., Kennedy v. Kings Mosquito Abatement Dist., 2013 U.S. Dist. LEXIS 37621 at *26 (E.D. Cal. Mar. 15, 2013) (dismissing race claim where “Plaintiff’s Complaint lack[ed] any facts to show that racial animus caused or was associated with any adverse employment action”); McCleary-Evans v. Maryland Dept. of Transp., State Highway Admin., 780 F.3d 582, 586 (4th Cir. 2015) (affirming dismissal of complaint: “While the allegation that non-Black decisionmakers hired non-Black applicants instead of the plaintiff is consistent with discrimination, it does not alone support a reasonable interference that the decisionmakers were motivated by bias.”). Count 3 of the SAC must therefore be dismissed. 4. Plaintiff Fails to State a Claim for FEHA Retaliation To state a claim for FEHA retaliation, Plaintiff must allege facts to show: (1) he engaged in “protected activity”; (2) he was subjected to adverse employment action; and (3) a causal link existed between the protected activity and adverse action. Raad v. Fairbanks N. Star Borough Sch. Dist., 323 F.3d 1185, 1196-97 (9th Cir. 2003). Plaintiff’s FEHA retaliation claim fails because he has not alleged facts sufficient to show that he engaged in legally protected activity or to demonstrate a causal link between such activity and his termination. Protected activity “must oppose activity the employee reasonably believes constitutes unlawful discrimination, and complaints about personal grievances or Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 17 of 28 Page ID #:464 OHSUSA:765584091.4 - 11 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 vague and conclusory remarks” will not suffice. Yanowitz v. L’Oreal USA, Inc., 36 Cal. 4th 1028, 1047 (2005) (emphasis added). Here, Plaintiff’s vague allegations fail to demonstrate that he had a reasonable belief he was subjected to unlawful discrimination, or that he reported that reasonable belief to Kroll. Plaintiff alleges that, while serving as Los Angeles Office Head, he discovered what he self-servingly characterizes as unspecified “anti-gay” comments in a terminated subordinate’s emails, and that he contacted Human Resources and requested that telephonic meetings be scheduled with the authors of the comments. SAC ¶19. Despite two opportunities to replead, Plaintiff does not allege that he told Human Resources (or anyone else in management) what the “anti-gay” comments were, nor does he allege that he explained to Human Resources (or anyone else in management) that he wanted the telephonic meetings because he believed he was being harassed or discriminated against based upon them. See Ropes v. Auto-Chlor Sys. of Wash. Inc., 220 Cal. App. 4th 635, 653 (2013) (sustaining demurrer on retaliation claim: “[T]o constitute retaliation, there must also be evidence the employer knew the employee was engaged in activities in opposition to the employer at the time of the alleged retaliation.”). Plaintiff’s allegations are insufficient to demonstrate that he engaged in protected activity as a matter of law. Plaintiff also fails to plead any facts to demonstrate a causal connection between any alleged protected activity and his termination. See Granillo v. Exide Tech., Inc., 2011 U.S. Dist. LEXIS 130669, at *58 (C.D. Cal. May 20, 2011) (quoting Kauffman v. Sidereal Corp., 695 F.2d 343, 345 (9th Cir.1982)) (“To establish causation, a plaintiff must show ‘by a preponderance of evidence that engaging in the protected activity was the reason for firing and that but for such activity[,] the plaintiff would not have been fired.’”). For this reason as well, the claim fails. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 18 of 28 Page ID #:465 OHSUSA:765584091.4 - 12 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 5. Plaintiff Fails to State a “Failure to Prevent” Claim Under FEHA Absent actionable discrimination, retaliation, or harassment, California law does not recognize a separate cause of action for failure to prevent. 2 Cal. Code Regs § 11023(a)(2) (“There is no stand-alone, private cause of action under Government Code section 12940(k)…claimant must also plead and prevail on the underlying claim of discrimination, harassment, or retaliation”); Garza v. BNSF Railway Co., 2012 U.S. Dist. LEXIS 80652, at *16-17 (E.D. Cal. June 11, 2012); Dickson v. Burke Williams, 234 Cal. App. 4th 1307, 1309 (2015); Trujillo v. N. County Transit, 63 Cal. App. 4th 280, 286, 288-89 (1998). Because each of Plaintiff’s underlying FEHA claims are defective, this claim must be dismissed. 6. Plaintiff’s Sarbanes Oxley Retaliation Claim Fails Under Rules 12(b)(1) and/or 12(b)(6) 5 Despite Kroll’s arguments in its motion to dismiss and meet and confer efforts as to why this claim is defective, Plaintiff has neither dropped his SOX claim nor added any factual allegations to support it.6 The claim fails for the same reasons articulated in Kroll’s motion to dismiss the FAC: (1) Kroll is not a covered company under SOX; (2) Plaintiff did not exhaust his contractor/subcontractor allegation with OSHA and (3) even if he had exhausted this allegation, he does not 5 It is unsettled in this Circuit whether the exhaustion requirement for SOX claims is jurisdictional. The Fourth Circuit has “assume[d], without deciding, that the requirement to exhaust one’s administrative remedies as provided for in § 1514A is jurisdictional” and some district courts have so held. See Feldman v. Law Enforcement Assocs. Corp., 752 F.3d 339, 345 n.7 (4th Cir. 2014) (citing cases); Genberg v. Porter, 935 F. Supp. 2d 1094, 1102 (D. Colo. 2013). Cf. Benson v. JP Morgan Chase Bank, N.A., 673 F.3d 1207, 1211-15 (9th Cir. 2012) (failure to exhaust administrative remedies under FIRREA is jurisdictional bar to suit). Other district courts have held that the failure to exhaust remedies under § 1514A constitutes a failure to state a claim under Rule 12(b)(6). See, e.g., Willis v. Vie Fin. Group, Inc., 2004 WL 1774575, at *5-6 (E.D. Pa. Aug. 6, 2004); Hanna v. WCI Cmtys., Inc., 2004 U.S. Dist. LEXIS 25652, at *3-4 (S.D. Fla. Nov. 15, 2004). 6 Plaintiff made clear during the parties’ meet and confer, that he had no more facts to support this claim. Lawson Decl. ¶13. The parties agreed that the Court must decide the issue of whether SOX applies to Plaintiff as a matter of law. Id. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 19 of 28 Page ID #:466 OHSUSA:765584091.4 - 13 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 qualify as contractor/subcontractor as a matter of law. a. Kroll Is Not A Covered Company Under SOX SOX only applies to specific categories of employers and employees. The statute, 18 U.S.C. § 1514A, provides in relevant part: WHISTLEBLOWER PROTECTION FOR EMPLOYEES OF PUBLICLY TRADED COMPANIES.— No company with a class of securities registered under section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 78l), or that is required to file reports under section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78o(d))…or any officer, employee, contractor, subcontractor, or agent of such company…may discharge, demote, suspend, threaten, harass, or in any other manner discriminate against an employee in the terms and conditions of employment…. Plaintiff does not allege, nor could he, that Kroll is “registered under section 12” or “required to file reports under section 15(d)” of the 1934 Exchange Act for purposes of coverage under the Act. See 18 U.S.C. § 1514A; Klawans v. Societe Generale, 2013 DOLSOX LEXIS 36, at *12-14, 2012-SOX-30 (ALJ Oct. 23, 2013) (dismissing SOX claim where company was not registered under Section 12 or required to file reports under section 15(d): “the test for determining whether a company is [ ] covered…is a simple one contained in the statute itself”). Rather, Plaintiff alleges that Kroll serves as a “contractor or subcontractor” of various entities, relying on a 2014 decision of the U.S. Supreme Court, Lawson v. FMR LLC, 134 S. Ct. 1158 (2014). SAC ¶77. That decision extended SOX coverage to employees of “contractors” and “subcontractors” of publicly traded companies under some circumstances, none of which are present here. (1) Failure to Exhaust “Contractor or Subcontractor” Claim As a threshold matter, Plaintiff did not assert in his OSHA Complaint that Kroll was a contractor or subcontractor of the companies and firms named in his SAC, and as a result, OSHA did not consider these allegations before dismissing his Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 20 of 28 Page ID #:467 OHSUSA:765584091.4 - 14 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 complaint. 7 Under SOX, it is well-settled that a plaintiff “may not…assert a particular claim, unless he has exhausted his administrative remedies as to that defendant or claim.” Smith v. Corning Inc., No. 06-CV-6516 CJS, 2007 U.S. Dist. LEXIS 52959, at *4-5 (W.D.N.Y. July 23, 2007) (citing cases); see 18 U.S.C. § 1514A(b)(1)(B); Wallace v. Tesoro Corp., 796 F.3d 468, 476 (5th Cir. 2015) (“the scope of a judicial complaint is limited to the sweep of the OSHA investigation that can reasonably be expected to ensue from the administrative complaint”); Curtis v. Century Sur. Co., 320 F. App’x 546 (9th Cir. 2009).8 Thus, Plaintiff failed to exhaust remedies with respect to these allegations. Plaintiff’s SOX allegations should be disregarded for this reason alone; however, they also fail for the reasons described below. (2) Failure to Demonstrate Jurisdiction9 And/Or State a Claim Plaintiff alleges in ¶¶ 78-80 of his SAC that Kroll is a “contractor or subcontractor” of the following entities: (1) Vipshop, (2) AmerisourceBergen, (3) Deutsche Bank, (4) Goldman Sachs, (5) Skadden Arps, (6) Simpson Thatcher, (7) Tiger Global, (8) JP Morgan, (9) Walgreens, (10) Bank of America Merrill Lynch, and (11) Cravath, Swaine & Moore. He alleges that he made SEC reports about (1) 7 The one exception is that Plaintiff stated in his OSHA Complaint that Tiger Global is a Kroll client. But Tiger Global is not publicly traded, nor is it required to file reports under section 15(d). As a result, any alleged contract between Kroll, a private entity, and Tiger Global, another private entity, is insufficient without more to demonstrate that Kroll was a “contractor” of a publicly traded company for purposes of SOX coverage. 8 See also Newman v. Metro. Life Ins. Co., Civ. Action No. 12-cv-10078, 2015 U.S. Dist. LEXIS 7271, at *11-16 (D. Mass. Jan. 21, 2015); Lutzeier v. Citigroup, Inc., Case No. 4:14CV183 RLW, 2015 U.S. Dist. LEXIS 28231 (E.D. Mo. Mar. 9, 2015). 9 The issue of employer/employee coverage under SOX has been decided under both Rules 12(b)(1) and 12(b)(6). See, e.g., Anthony v. Nw. Mut. Life. Ins. Co., 2015 U.S. Dist. LEXIS 118961, at *7, 17 (N.D.N.Y. Sep. 8, 2015) (12(b)(6)); Plutzer v. U.S. Auto. Ass’n, 2015 DOLSOX LEXIS 15, at *15, 2015-SOX-7 (ALJ Mar. 24, 2015) (12(b)(1)). Cf. Klawans, 2013 DOLSOX LEXIS 36, at *15 (“Whether Respondent is covered under SOX is an essential element of subject matter jurisdiction to be established by Complainant in this matter.”). As described above, under Rule 12(b)(1), the Court need not confine its evaluation to the face of the pleadings, but may review or accept any evidence, such as affidavits, or it may hold an evidentiary hearing. St. Clair, 880 F.2d 199 at 201. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 21 of 28 Page ID #:468 OHSUSA:765584091.4 - 15 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Vipshop and (2) AmerisourceBergen. SAC ¶¶22, 79. Despite Plaintiff’s conclusory allegations to the contrary, Kroll has never contracted or subcontracted with Vipshop or AmerisourceBergen. Lawson Decl., Ex. 4 (Declaration of Kenn Lichtenwalter in Support of Defendants’ Partial Motion to Dismiss and to Strike First Amended Complaint (“Lichtenwalter Decl.”)) at ¶4.10 Entities 3-11 are alleged to be lawyers, investment bankers, or partial owners of Vipshop or AmerisourceBergen. SAC ¶¶78- 79. Plaintiff does not, and cannot allege that Kroll performed any work for entities 3-11 that involved Vipshop or AmerisourceBergen. Lichtenwalter Decl. at ¶5. Moreover, regardless of whether Kroll has ever contracted with (5) Skadden Arps, (6) Simpson Thatcher, (7) Tiger Global, and (11) Cravath, Swaine & Moore, there can be no dispute that these entities are not publicly traded. (a) Lawson v. FMR LLC Does Not Apply Here Contrary to Plaintiff’s allegation, the Supreme Court decision in Lawson v. FMR LLC simply does not apply here. Lawson held that employees of FMR, a private investment advisory firm, were protected under SOX for reporting alleged securities violations observed in the course of their work for Fidelity mutual funds. See Lawson, 134 S. Ct. at 1158. The Court looked to SOX’s legislative history in the wake of the Enron scandal, discussing “ample evidence of contractors [such as Andersen and UBS Paine-Webber] demoting or discharging employees…who jeopardized the contractor’s business relationship with Enron by objecting to Enron’s financial practices.” Id. at 1170. From this legislative history, the Court determined “one can safely conclude that Congress enacted § 1514A aiming to encourage 10 The Lichtenwalter Declaration may be considered on Defendants’ 12(b)(1) motion. See St. Clair, 880 F.2d at 201; Savage, 343 F.3d at 1039 n.2. But even absent the declaration, Plaintiff’s allegations that Kroll was a “contractor or subcontractor” of Vipshop or AmerisourceBergen should be rejected under 12(b)(6) as precisely the type of mere “labels and conclusions” that are not entitled to the presumption of truth on a motion to dismiss. See Twombly, 550 U.S. at 555 (“a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitlement to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.”); D’Amico v. City of New York, 132 F.3d 145, 149 (2d Cir. 1998) (court not required to accept allegations as true on motion to dismiss if they are demonstrably false or “wholly fanciful”). Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 22 of 28 Page ID #:469 OHSUSA:765584091.4 - 16 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 whistleblowing by contractor employees who suspect fraud involving the public companies with whom they work.” Id. (emphasis added).11 The Court also relied upon the unique structure of the mutual fund industry in deciding that the plaintiffs were covered by SOX. Publicly traded mutual funds generally have no employees themselves; rather, the funds are administered entirely by employees of the private investment advisory firms that contract with them. Id. at 1171. If the Lawson plaintiffs were not covered, it could have insulated the entire mutual fund industry from 18 U.S.C. § 1514A. Id. As Congress could not have intended this result, the Court’s construction “protect[ed] the ‘insiders [who] [we]re the only firsthand witnesses to the [shareholder] fraud.’” Id. at 1171. In reaching its decision, the Supreme Court cited with approval several “limiting principles” upon which district courts and the Department of Labor have subsequently relied to prevent overbroad applications of its holding. See Anthony, 2015 U.S. Dist. LEXIS 118961, at *17 (Lawson is limited to “situations where a contractor employee is functionally acting as an employee of a public company, and in that capacity, is a witness to fraud by the public company”); Gibney v. Evolution Mktg. Research, LLC, 25 F. Supp. 3d 741 (E.D. Pa. 2014) (dismissing SOX claim that neither implicated the “peculiar structure of the mutual fund industry” nor Congress’ “specific[] concern[] with preventing shareholder fraud either by the public company itself or through its contractors”) (emphasis in original); Plutzer, 2015 DOLSOX LEXIS 15, at *24-35 (dismissing SOX claim for lack of jurisdiction where claim did not implicate mutual fund industry or allege public company fraud). See also Flesznar v. U.S. Dep’t of Labor, 598 F.3d 912, 915 (7th Cir. 2010) (rejecting 11 Justice Ginsburg delivered the majority opinion, joined by Chief Justice Roberts, and Justices Breyer and Kagan, and joined in principal part by Justices Scalia and Thomas. Justice Scalia filed an opinion concurring in principal part and concurring in the judgment, joined by Justice Thomas, in which he stated that he did not agree with the Court’s reliance on anything other than the statute’s text in reaching its judgment. Id. at 1176-77. Justice Sotomayor filed a dissent, joined by Justices Kennedy and Alito. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 23 of 28 Page ID #:470 OHSUSA:765584091.4 - 17 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 argument that non-publicly traded company is covered by SOX simply because it contracts with public companies). (b) Plaintiff’s Claim Fails Plaintiff alleges that he conducted research “on his own time” to discover that Vipshop and AmerisourceBergen had committed securities violations. SAC ¶21 (emphasis added); OSHA Complaint. Thus, this is not a situation in which Plaintiff was “fulfilling [his] role as a contractor for the public compan[ies]” when he discovered and reported the violations. Lawson, 134 S. Ct. at 1173; Anthony, 2015 U.S. Dist. LEXIS 118961, at *16. Indeed, Plaintiff concedes that he did not perform work for Vipshop while at Kroll. See FEHA Charge (“Mr. Glapion was not aware of whether Vipshop was a Kroll client….”)). Moreover, as described above, Vipshop and AmerisourceBergen are not, and have never been, Kroll clients. Lichtenwalter Decl. at ¶4. As for Plaintiff’s attempt to invoke SOX coverage by simply listing every alleged Kroll client that he thinks may have had any sort of relationship with Vipshop or AmerisourceBergen without any further detail (i.e., entities 3-11), this is clearly insufficient to show that Plaintiff was a “contractor or subcontractor” of a publicly traded company within the meaning of Lawson. Plaintiff has not alleged, nor could he, that there was any nexus whatsoever between Kroll’s work for those entities and his alleged whistleblowing. Of course, the mere fact that a private company does work for public companies’ bankers, lawyers, and partial owners is insufficient, without more, to demonstrate that the private company is a “contractor” or “subcontractor” of the public companies themselves. Cf. Flesznar, 598 F. 3d at 915 (“Nothing in § 1514A implies that, if the AMA buys a box of rubber bands from Wal- Mart, a company with traded securities, the AMA becomes covered by § 1514A”). Finally, this case does not implicate the unique structure of the mutual fund industry. Lawson, 134 S. Ct. at 1171. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 24 of 28 Page ID #:471 OHSUSA:765584091.4 - 18 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 For all of these reasons, Plaintiff’s SOX claim should be dismissed under Rule 12(b)(1) and/or 12(b)(6). 7. Plaintiff Fails to State a Claim of Dodd-Frank Retaliation Plaintiff alleges that he states a claim under the Dodd-Frank Act because he made disclosures that are “required or protected” under SOX. SAC ¶86. As described above, Kroll is not covered by SOX; thus Plaintiff’s alleged report to Kroll was not “required or protected” by SOX. Accordingly, Plaintiff cannot state a Dodd- Frank claim on this basis. 8. Plaintiff’s Defamation Claim is Wholly Vague and Defective Despite a second chance to replead, Plaintiff’s defamation claim is substantially the same as that of the FAC. Defamation requires (1) a publication about an individual (2) that is false, (3) defamatory, (4) unprivileged, and (5) has a natural tendency to injure or causes special damage (which must be pled). See Cal. Civ. Code §§ 45, 46; Taus v. Loftus, 40 Cal. 4th 683, 720 (2007). Plaintiff appears to allege the following defamatory publications: 1. a subordinate stated, at an unspecified time and context to an unidentified coworker that “Plaintiff was hunting straight white men” (SAC ¶¶16, 92); 2. the same subordinate “implied” that Plaintiff was dating a male co-worker (SAC ¶¶16, 92); 3. unidentified persons stated that Plaintiff “failed to nurture and conspired to get rid of an employee” (SAC ¶ 92); 4. unidentified persons made unspecified derogatory comments regarding Plaintiff’s sexuality (id.); 5. Plaintiff’s “personal folder” with bank, tax, and medical information “was moved” onto a company shared drive12 (id.); 12 The parties agreed during their meet and confer that this allegation should be stricken from Plaintiff’s defamation claim. Lawson Decl. ¶15. Accordingly, Kroll does not address this allegation in its motion. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 25 of 28 Page ID #:472 OHSUSA:765584091.4 - 19 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 6. unidentified persons stated that Plaintiff “harmed a Kroll client” and used company resources improperly in violation of company policies (SAC ¶95); and 7. the one addition Plaintiff made to this claim, that he is “informed and believed” that Kroll’s articulated reason for terminating him “heavily undermined his prospects of locating comparable employment.” (SAC ¶27; Lawson Decl., Ex. 2 ¶27). Other than the allegations involving his subordinate, Plaintiff fails to identify who made the alleged statements, and for each, not only fails to state when or to whom they were made or the context, but admits that he cannot plead any facts to do so. SAC ¶93 (“While the precise dates of these publications are not known to Plaintiff…the publications may have started after her (sic) termination by creating false claims regarding plaintiff”). Such vague allegations are plainly insufficient to state a defamation claim. See Lipman v. Brisbane Elementary Sch. Dist. 55 Cal. 2d 224, 235 (1961) (defamation claim “is defective” because it “... does not allege either the specific words or the substance of [the] statements ... but instead merely alleges the conclusions of the pleader that statements were made which ‘intimated and suggested’ that plaintiff had done certain wrongful things”); Bell Atlantic v. Twombly, 550 U.S. 544, 555 2007 (“Factual allegations must be enough to raise a right to relief above the speculative level.”). In addition, Plaintiff simply fails to allege any “false publications” of fact. See Savage v. Pac. Gas & Elec. Co., 21 Cal. App. 4th 434, 445 (1993) (citation omitted); Gregory v. McDonnell Douglas Corp., 17 Cal. 3d 596, 601 (1976); Baker v. Los Angeles Herald Examiner, 42 Cal. 3d 254, 260 (1986). Alleged statements that Plaintiff was “hunting straight white men,” “failed to nurture,” “conspired to get rid of an employee”, that he “harmed a Kroll client” and that he used company resources “improperly” are expressions of opinion that are not actionable under well-settled law. See id. Plaintiff’s allegation that a subordinate “implied” that he was dating a Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 26 of 28 Page ID #:473 OHSUSA:765584091.4 - 20 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 male coworker does not allege a false statement of fact, nor does Plaintiff’s vague allegation of unspecified “derogatory comments” about his sexuality. Finally, to the extent Plaintiff alleges that unidentified persons stated he violated Kroll company policies, he cannot claim that this statement is false. Nor can Plaintiff satisfy the other elements of this claim. See Taus, 40 Cal. 4th at 720. For all of these reasons, Plaintiff’s defamation claim should be dismissed.13 C. Plaintiff’s Claim for Wrongful Termination in Violation of Public Policy Should be Stricken Pursuant to Fed. R. Civ. P 12(f), the court may strike “any redundant, immaterial, impertinent, or scandalous matter.” The essential function of a Rule 12(f) motion is to “avoid the expenditure of time and money that must arise from litigating spurious issues by dispensing with those issues prior to trial.” Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993); Sidney-Vinstein v. A.H. Robins Co., 697 F.2d 880, 885 (9th Cir. 1983). A public policy wrongful discharge claim must be premised on a fundamental public policy delineated in statute or regulations. Warwick v. California Dep’t of Corr., 2008 U.S. Dist. LEXIS 97207 at *16 (N.D. Cal. Nov. 21, 2008). Plaintiff’s claim, which is unchanged from the FAC, is in part based on “[his] opposition to and refusal to participate in activities which would result in a violation or noncompliance with federal, state, or local regulations, including but not limited to Defendants’ [sic] failure to follow laws which allow complaints to the SEC”. SAC ¶106. 13 In addition, to the extent any of the alleged statements occurred more than one year prior to the filing of Plaintiff’s original complaint on February 5, 2016, they are untimely; however, despite two chances to replead, it is impossible from Plaintiff’s vague SAC to tell, further demonstrating why this claim is deficiently pled and should be dismissed. See Cal. Civ Proc. Code 340(c). Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 27 of 28 Page ID #:474 OHSUSA:765584091.4 - 21 - MPA IN SUPPORT OF PARTIAL MOTION TO DISMISS AND STRIKE SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Despite two opportunities to replead, Plaintiff’s SAC still fails to specify which law sets forth the public policy on which this claim is premised. See Wynes v. Kaiser Permanente Hosps., 2011 U.S. Dist. LEXIS 35400 at *25 (E.D. Cal. Mar. 31, 2011) (citing Turner v. Anheuser-Busch, Inc., 7 Cal. 4th 1238, 1252 (1994) (“Vague charges ‘largely unaccompanied by citations to specific statutory or constitutional provisions, puts [Defendant] and the court in the position of having to guess at the nature of the public policies involved, if any.’”). Plaintiff’s wrongful termination claim should be stricken. V. CONCLUSION For the reasons above, Defendant respectfully requests that the Court partially dismiss and strike Plaintiff’s Second Amended Complaint with prejudice. Dated: August 11, 2016 Orrick, Herrington & Sutcliffe LLP By: /s/ Lynne C. Hermle LYNNE C. HERMLE Attorneys for Defendant KROLL ASSOCIATES, INC. Case 2:16-cv-00828-FMO-AJW Document 42-1 Filed 08/11/16 Page 28 of 28 Page ID #:475 OHSUSA:765651949.4 DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 LYNNE C. HERMLE (STATE BAR NO. 99779) lchermle@orrick.com MEGAN M. LAWSON (STATE BAR NO. 294397) megan.lawson@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 1000 Marsh Road Menlo Park, California 94025 Telephone: 650-614-7400 Facsimile: 650-614-7401 RENEE B. PHILLIPS (pro hac vice) rphillips@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 51 West 52nd Street New York, New York 10019-6142 Telephone: 212-506-5000 Facsimile: 212-506-5151 MARK MERMELSTEIN (STATE BAR NO. 208005) mmermelsein@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 777 South Figueroa Street, Suite 3200 Los Angeles, California 90017 Telephone: 213-629-2020 Facsimile: 213-612-2499 Attorneys for Defendant KROLL ASSOCIATES, INC. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation Defendant. Case No. 2:16-CV-00828-FMO-AJW DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF PARTIAL MOTION TO DISMISS AND TO STRIKE PLAINTIFF’S SECOND AMENDED COMPLAINT Date: September 8, 2016 Time: 10:00 am Courtroom: 22-5th Floor Judge: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 1 of 117 Page ID #:476 OHSUSA:765651949.4 1 DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I, Megan M. Lawson, declare as follows: 1. I am a member of the California State bar and an associate in the law firm of Orrick, Herrington & Sutcliffe LLP and am admitted in the Central District of California. I am attorney of record for Defendant Kroll Associates, Inc. I make this declaration in support of Defendant’s Partial Motion to Dismiss and to Strike Plaintiff’s Second Amended Complaint and am informed and believe that the following is true and correct. 2. Plaintiff filed his Second Amended Complaint (“SAC”) on July 14, 2016. A true and correct copy of the SAC is attached hereto as Exhibit 1. 3. After receiving Plaintiff’s SAC, I created a redlined version that compared it to the FAC through a software program and tracks all changes (deletions in red and additions in blue). A true and correct copy of the redlined version of Plaintiff’s SAC is attached hereto as Exhibit 2. 4. Pursuant to the Court’s Order granting Defendants’ Motion to Dismiss (Dkt. Entry 34), the parties met and conferred regarding Kroll’s anticipated motion to dismiss the SAC on August 4, 2016 at 12:00 p.m. at Orrick, Herrington & Sutcliffe LLP, 777 South Figueroa Avenue in Los Angeles, California. The meeting lasted approximately one-hour and thirty minutes. Plaintiff’s second chair counsel, Joshua Arnold, appeared in person and Plaintiff’s lead trial counsel, Bernard Alexander, appeared via telephone. Defendant’s lead trial counsel Lynne C. Hermle and I appeared in person. Renee B. Phillips also appeared via telephone for Defendant. 5. Meet and Confer Process: At or around 11:55 a.m., I met Mr. Arnold in the lobby. I asked Mr. Arnold whether Mr. Alexander’s trial had begun that morning. Mr. Arnold informed me that Mr. Alexander’s trial had been continued to August 15, 2016 and that Mr. Alexander was back in Los Angeles, but would be joining the meeting via telephone. Ms. Hermle joined the meeting shortly thereafter. The parties then went through each of the ten claims in the SAC and discussed Defendant’s Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 2 of 117 Page ID #:477 OHSUSA:765651949.4 - 2 - DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 reasons for moving on each: 6. Claim 1: Sexual Orientation Discrimination. a. Defendant’s position. I explained to Plaintiff’s Counsel that the reason Kroll was moving to dismiss this claim was the lack of factual detail alleging discrimination on the basis of sexual orientation. I also explained that the SAC does not allege any facts to support that any decisionmakers harbored animus and asked whether Plaintiff had any facts to support that decisionmakers exhibited sexual orientation animus. b. Plaintiff’s position. Mr. Arnold stated that management exchanged “anti-gay” emails regarding Plaintiff and that he brought these “issues” to management and received no response. Additionally, animus was alleged in Kroll’s lack of response to Plaintiff’s alleged complaints to Human Resources and the unfamiliarity with Plaintiff’s previous complaints. Mr. Arnold confirmed that the management-level emails alleged in the SAC were not from decisionmakers but stated, for the first time, that members of management made unspecified complaints to upper management about Plaintiff and that these alleged complaints were taken seriously by upper management. 7. In response to Mr. Arnold’s statement regarding anti-gay emails, I reminded Mr. Arnold of the parties’ Rule 26(f) meet and confer in which Plaintiff agreed to produce the allegedly anti-gay emails with his initial disclosures. Mr. Arnold confirmed that Plaintiff produced the emails in his possession with his initial disclosures, and that Plaintiff had taken from Kroll “what he thought were the most offending emails.” I have reviewed the emails that Plaintiff served with his initial disclosures and have not seen any emails even suggesting discriminatory animus from Kroll employees. 8. Claim 2: Sexual Orientation Harassment. a. Defendant’s position. I explained to Plaintiff’s counsel Kroll’s position that the alleged facts are not enough to meet the “severe or pervasive” Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 3 of 117 Page ID #:478 OHSUSA:765651949.4 - 3 - DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 standard for harassment under FEHA, in particular because Plaintiff does not allege that any of the alleged harassing statements were made directly to him. Mr. Arnold agreed that “no comments [were] made to [Plaintiff] directly identifying his sexual orientation” and no slurs were made regarding Plaintiff. b. Plaintiff’s position. Mr. Arnold confirmed that the alleged discriminatory and/or harassing statements were not made by anyone at Kroll with authority over Plaintiff (i.e. a decisionmaker). Mr. Arnold then pointed to Plaintiff’s new allegation in the SAC, that Plaintiff allegedly complained to Emanuele Conti about Kroll’s alleged failure to investigate and Mr. Conti allegedly responded that Plaintiff was seeking special treatment because he was a gay man. When asked to specify what Mr. Conti said, Mr. Arnold was not able to provide specifics but stated that Mr. Conti did not make any direct statements regarding Plaintiff’s sexual orientation. 9. Claim 3: Race Discrimination. a. Defendant’s position. I explained to Plaintiff’s counsel that Kroll planned to move on this claim because there were no allegations of racial animus in the SAC and that the only allegation even mentioning race was an alleged statement that a subordinate said that Plaintiff was “hunting straight white males.” b. Plaintiff’s position. Mr. Arnold noted that racial animus was shown in the statement that Plaintiff was “hunting straight white males” and that when Plaintiff asked Mr. Conti for an update on his investigation, Mr. Conti allegedly told him it was going to take time to consider the issue and to not seek special treatment. Mr. Arnold went on to say that “special treatment” was extended to white employees versus non-whites and identified the following examples in support of this “special treatment”: i. Plaintiff’s termination; ii. Joshua Lichtman’s termination; iii. two unidentified non-white employees that Plaintiff Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 4 of 117 Page ID #:479 OHSUSA:765651949.4 - 4 - DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 terminated; and iv. a white employee that Plaintiff terminated for misconduct. When I noted for Mr. Arnold that his last example contradicts his claim that white employees received special treatment, Mr. Arnold articulated, for the first time, that the white employees received a severance package, whereas Plaintiff did not. 10. Claim 4: FEHA Retaliation. a. Defendant’s position. I explained to Plaintiff’s counsel that there are no allegations in the SAC that Plaintiff actually told Human Resources he was being discriminated against and that there is nothing alleging that Plaintiff was terminated for complaining about discrimination or harassment (i.e. no causal link between Plaintiff’s alleged complaint and his termination). b. Plaintiff’s position. Mr. Arnold stated that the SAC was clear that Plaintiff complained to Human Resources about discrimination. Mr. Arnold stated that the causal link can be shown by two things: (1) the timing of the events surrounding the termination and (2) when Plaintiff allegedly asked Mr. Conti about the status of his investigation in June, Mr. Conti did not provide a straight answer on whether Kroll investigated his alleged complaints. 11. Claim 5: Failure to Prevent. The basis upon which Kroll moves to dismiss Claim 5 is that Plaintiff’s underlying discrimination claims fail. The parties agreed that if Plaintiff’s underlying discrimination claims fail, so does his failure to prevent claim. 12. Claim 6: Labor Code Retaliation. I explained to Plaintiff’s counsel that Kroll is not moving to dismiss this claim. 13. Claim 7: Violation of SOX. Ms. Phillips noted that Plaintiff’s SOX allegations in the SAC were unchanged from the FAC. She went through the bases for Kroll’s anticipated motion to dismiss, which were the same arguments Kroll made in its motion to dismiss the FAC. Mr. Arnold noted that the parties continued to agree to disagree on the legal issues. Mr. Arnold confirmed that Plaintiff has no Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 5 of 117 Page ID #:480 OHSUSA:765651949.4 - 5 - DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 additional facts to add to this claim. The parties agreed that Claim 7 should be decided as a matter of law. 14. Claim 8: Violation of Dodd-Frank. Ms. Phillips noted that Plaintiff’s Dodd-Frank allegations in the SAC were unchanged from the FAC, and thus, Kroll’s arguments in its anticipated motion to dismiss would be the same. The parties agreed that this claim is based upon Plaintiff’s SOX claim and therefore if Plaintiff’s underlying SOX claim fails, so does this claim. 15. Claim 9: Defamation. a. Defendant’s position. I explained to Plaintiff’s counsel that Kroll is moving to dismiss this claim due to lack of factual detail needed to allege defamation and that the statements were insufficient to form the basis of a defamation claim in that they were opinions (e.g. the allegation that Plaintiff failed to nurture an employee). b. Plaintiff’s position. Mr. Arnold stated that the facts supporting this claim were “laid out in paragraph 92.” c. The parties then discussed each of the alleged defamatory statements in paragraph 92. Regarding the allegation that Plaintiff’s personal folder was moved onto Kroll’s shared drive, Plaintiff’s counsel agreed that this allegation should not have been a basis for Plaintiff’s defamation claim. Regarding the remaining alleged defamatory statements, the parties disagreed as to whether Plaintiff met the pleading standards to survive a motion to dismiss. 16. Claim 10: Wrongful Termination in Violation of Public Policy. a. Defendant’s position. Ms. Hermle explained that Kroll takes issue with Plaintiff’s vague allegation of noncompliance in the SAC (specifically, “a violation or noncompliance with federal, state or local regulations, including but not limited to Defendant’s failure to follow laws which allow complaints to the SEC”) without specifying that the laws are SOX and Dodd-Frank; this could incorporate any laws, which does not meet the pleading requirements. Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 6 of 117 Page ID #:481 OHSUSA:765651949.4 - 6 - DECLARATION OF MEGAN M. LAWSON IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 b. Plaintiff’s position. Mr. Arnold agreed that Plaintiff could be more specific regarding this claim. 17. As a result of the parties’ meet and confer conference, we were able to reach some agreement and narrow the scope of Defendant’s motion to dismiss and Plaintiff appears to agree that part of Count 10 lacks the requisite specificity. Unfortunately, the parties were unable to reach agreement on Counts 1-4, 7 and 9. 18. A true and correct copy of the Declaration of Renee B. Phillips in Support of Defendants’ Motion to Partially Dismiss and to Strike Plaintiff’s First Amended Complaint and supporting exhibits (Dkt. Entry 26-4) is attached hereto as Exhibit 3. 19. A true and correct copy of the Declaration of Kenn Lichtenwalter in Support of Defendants’ Motion to Partially Dismiss and to Strike Plaintiff’s First Amended Complaint (Dkt. Entry 26-3) is attached hereto as Exhibit 4. I certify under penalty of perjury and pursuant to the laws of the United States (28 U.S.C. § 1746) and the laws of the State of California that the foregoing is true and correct, and that this declaration was executed by me on August 11, 2016. /s/ Megan M. Lawson Megan M. Lawson Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 7 of 117 Page ID #:482 EXHIBIT 1 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 8 of 117 Page ID #:483 1 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ALEXANDER KRAKOW + GLICK LLP J. Bernard Alexander, III (State Bar No.128307) Joshua M. Arnold (State Bar No. 240154) 401 Wilshire Boulevard, Suite 1000 Santa Monica, California 90401 T: 310 394 0888 | F: 310 394 0811 E: balexander@akgllp.com | jarnold@akgllp.com Attorneys for Plaintiff MELVIN GLAPION UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION Plaintiff MELVIN GLAPION (“Plaintiff”) complains and alleges as follows: INTRODUCTION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation, Defendants. _______________________________ Case No. 2:16-CV-00828-FMO-AJW SECOND AMENDED COMPLAINT FOR DAMAGES: 1) Sexual Orientation Discrimination; 2) Sexual Orientation Harassment; 3) Race Discrimination; 4) Retaliation for Complaints of Sexual Orientation Harassment and Discrimination; 5) Failure to Prevent and/or Remedy Discrimination, Harassment and Retaliation (Gov. Code §12940(k)); 6) Retaliation in Violation of California Labor Code § 1102.5; 7) Violation of Whistleblower Protection under the Sarbanes Oxley Act (18 U.S.C. § 1514A, et seq.); 8) Violation of Whistleblower protections of the Dodd-Frank Act Wall Street Reform and Consumer Protection Act (15 U.S.C. §78u-6); 9) Defamation; 10) Wrongful Termination in Violation of Public Policy. DEMAND FOR JURY TRIAL Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 1 of 31 Page ID #:403 Exhibit 1 - Page 1 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 9 of 117 Page ID #:484 2 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiff Glapion, a gay black man, joined Kroll Inc.’s London office in 2010 as managing director. As a result of his stellar performance in London, in late 2013, the head of North American operations invited Plaintiff to take over responsibility for the Kroll office in Los Angeles (“Kroll Los Angeles” or “Kroll Associates”). As with London, reform of the Los Angeles office required identifying underperforming employees and ending their employment with Kroll. Plaintiff terminated underperforming minority employees in Los Angeles without incident, but he received a dramatically different response when he attempted to terminate underperforming white straight employees. Members of management participated in discriminatory conversations about Plaintiff that focused on his sexual orientation and implied that, as a gay black man, he was targeting straight whites. When Plaintiff complained about this discrimination, upper management and HR failed to take action on his complaints. On June 2, 2015, Plaintiff informed CEO Manny Conti that Plaintiff had lodged a complaint with the SEC regarding Vipshop, a Chinese e-business listed on the New York Stock Exchange (“NYSE”). Following this disclosure, Conti instructed Plaintiff to meet with external counsel regarding this SEC complaint, and he was grilled for several hours. On June 16, 2015, Defendant terminated Plaintiff’s employment in retaliation for his actions to expose Vipshop’s fraud. ALLEGATIONS COMMON TO ALL CAUSES OF ACTION PARTIES 1. Plaintiff MELVIN GLAPION (“Plaintiff” or “Glapion”) is, and at all relevant times mentioned herein was, an individual residing in the State of California, City of Los Angeles. Plaintiff was employed by Defendant KROLL ASSOCIATES INCORPORATED (“Kroll” or “Kroll Associates”) from approximately 2010 through June 16, 2015, working his way to the position of the head of the Los Angeles office. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 2 of 31 Page ID #:404 Exhibit 1 - Page 2 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 10 of 117 Page ID #:485 3 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 2. Plaintiff is informed and believes and based thereon alleges that Defendant KROLL ASSOCIATES INCORPORATED is, and at all times mentioned, was a Delaware corporation doing business in the State of California, city of Los Angeles. 3. At all relevant times, Defendants were employers as defined by sections 12926 and 12940 of the California Fair Employment and Housing Act (FEHA). With respect to Plaintiff’s claims for compensatory and punitive damages, Defendants are employers of more than five hundred (500) persons. 4. Section 2(H) of Industrial Wage Commission (“IWC”) Order Number 4-2001 defines an “employer” as any “person as defined in Section 18 of the [California] Labor Code, who directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, hours, or working conditions of any person.” Plaintiff is informed, believes, and alleges that Defendants directly, indirectly, or acting through the agency of each other, employ or exercise control over Plaintiff’s wages, hours, or working conditions. Specifically, Defendants direct and control, with the assistance of or through the other named Defendants, the terms and conditions of Plaintiff’s employment. Accordingly, Defendants are deemed to be Plaintiff’s joint employers. EXHAUSTION OF REMEDIES 5. On September 1, 2015, Plaintiff filed a timely complaint under the Sarbanes-Oxley with the Department of Labor's Occupational Health and Safety Administration ("OSHA"). On October 20, 2015, The Department of Labor, through its agent, issued a finding that Kroll Associates Inc. were not publically traded companies, or fell within the meaning of 18 U.S.C. § 1514A, because Defendants do not possess securities registered under Section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 781) and is required to file reports under Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §780(d)). Plaintiff timely appealed Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 3 of 31 Page ID #:405 Exhibit 1 - Page 3 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 11 of 117 Page ID #:486 4 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 these findings before an Administrative Law Judge on November 16, 2015. On March 1, 2016, more than 180 days had passed since Plaintiff’s initial OSHA filing, exhausting this administrative remedy. On March 4, 2016, pursuant to the suggestion of Administrative Law Judge Richard M. Clark, the ALJ assigned to the matter, Plaintiff requested a dismissal of the OSHA complaint so that the matter may be fully adjudicated in federal court in this action. The dismissal, with the ALJ notation that the matter was to be adjudicated in federal court, was dismissed by Judge Clark on March 9, 2016. 6. Plaintiff has filed a timely charge of discrimination with the California Department of Fair Employment and Housing, and has received a "right- to-sue" notice for all state law discrimination claims alleged herein. This suit is brought within one year of Plaintiffs "right-to-sue" letter. JURISDICTION AND VENUE 7. The Court has jurisdiction over this action because Plaintiff s claims arise under federal statutes. This Court has subject matter jurisdiction over these claims pursuant to the Sarbanes Oxley Act as codified in 18 U.S.C. § 1514A, et seq. and the Whistleblower protections of the Dodd-Frank Act Wall Street Reform and Consumer Protection Act in 15 U.S.C. §78u-6 which vests federal jurisdiction in the District court. Venue is appropriate because the actions which form the basis for Plaintiff s claims occurred in Los Angeles, which is within this District. 8. This Court has general personal jurisdiction over Defendants because, at all relevant times, Defendants had systematic and continuous contacts with the State of California. Defendants are registered to do business in California and are participating in major business operations in California. This Court also has specific personal jurisdiction over Defendants because the claims in this action all stem from Defendants’ specific contacts with the State of California, namely the Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 4 of 31 Page ID #:406 Exhibit 1 - Page 4 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 12 of 117 Page ID #:487 5 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 control they exercised over Plaintiff in Los Angeles, California. 9. Additionally, this Court has subject matter jurisdiction over these claims pursuant to 28 U.S.C. § 1332 and 28 U.S.C. § 1337. As set forth in the paragraphs below, the amount in controversy is at least $250,000. 10. Venue is proper in the Central District of California because Plaintiff’s claim for relief arose out of Defendants’ control of Plaintiff in Los Angeles, California, where all relevant events and omissions supporting Plaintiff’s claims for relief occurred. DEMAND FOR JURY TRIAL 11. Plaintiff hereby demands a jury trial as provided by Rule 38(a) of the Federal Rules of Civil Procedure. FACTUAL ALLEGATIONS 12. Kroll hired Plaintiff as managing director of Kroll’s London office in 2010. As a result of Plaintiff s successful management and staff reorganization in London, he was asked to move to the Los Angeles office. Mr. Glapion began working in the Los Angeles office in October 2013 and by January 2014 was working exclusively in Los Angeles. 13. By late 2013, Plaintiff had supervised the Los Angeles employees for a sufficient time to begin the reorganization of the office. After this review, he recommended three employees be terminated due to their performance, and management was supportive of these terminations. 14. In August 2014, Kroll CEO Manny Conti requested that office heads rate their employees’ performance. Plaintiff identified one employee remaining in his office as a poor performer, Josh Lichtman. While Plaintiff had terminated other underperforming employees without interference, the reaction to Plaintiff’s recommendation to terminate this straight white male was starkly different. Although North America HR director Dan Watson had previously Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 5 of 31 Page ID #:407 Exhibit 1 - Page 5 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 1 of 117 Page ID #:488 6 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 acknowledged that the obvious shortcomings of this Lichtman’s performance meant that creation of a Performance Improvement Plan (“PIP”) was futile, and that termination should proceed immediately, other members of management objected and announced their intention to “establish a task force” to save Lichtman. Despite the acknowledgement that such an effort was futile, Plaintiff was instructed to prepare a PIP. Plaintiff had previously terminated employees for underperformance who were not straight white men without any requirement to extend a PIP, and observed that this special standard appeared to exist only for straight white males. 15. Mr. Glapion issued the PIP as directed. However, rather than work to meet the PIP goals, the Lichtman contacted San Francisco Director Betsy Blumenthal and other non-LA office employees in an effort to save his job rather than do his job. Not only was Licthman not disciplined for this departure from the PIP, he was given multiple extensions on his deadline to achieve the goals set by the PIP, partially as a result of Blumenthal moving to interfere in the PIP at his behest. 16. During this same time frame, members of Kroll Los Angeles upper management began to direct discriminatory comments toward Plaintiff. Director Mark Noellinger commented to a co-worker that Plaintiff was “hunting straight white males” who did not fit with his vision of a “gays-only office.” Noellinger also implied that Plaintiff was dating a male coworker, a false allegation. Remarks such as these were made to members of Plaintiff’s office, and occurred in both conversations and email exchanges. These discriminatory comments made Plaintiff concerned for his own future at Kroll, as the comments that Plaintiff, a gay black man, was “hunting” straight whites showed a discriminatory motive to oppose Plaintiff’s personnel decisions due to his race and sexual orientation. 17. The PIP had been scheduled to last for only 8 weeks, but with extensions wound up lasting almost 8 months. Eventually, Lichtman was terminated in April 2014, but only after he was paid 9 months’ salary as severance. In the wake Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 6 of 31 Page ID #:408 Exhibit 1 - Page 6 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 14 of 117 Page ID #:489 7 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of this termination, more defamatory remarks were directed at Plaintiff. Blumethal announced to her staff that she was “ashamed” of the fact that Plaintiff had terminated Lichtman, and implied that it was a personal vendetta on the part of Plaintiff. 18. After the termination, Plaintiff reviewed Lichtman’s emails, and discovered a number of anti-gay comments as well as emails from managers encouraging Plaintiff’s subordinate to undermine Plaintiff and ignore the PIP. These emails repeatedly made mocking and negative reference to Plaintiff’s sexual orientation, and discussed Plaintiff’s sexual orientation in the context of Kroll managers and employees seeking to block Plaintiff’s ability to manage his office. 19. As a result of discovering these management level emails, Plaintiff contacted Human Resources in May 2015 on at least three separate occasions and requested that telephonic meetings be scheduled with the authors of the comments. However, despite repeated requests by Plaintiff, Kroll HR took no action. Plaintiff complained about these comments and HR’s failure to remedy them. HR continued to refuse to conduct an investigation of Plaintiff’s repeated complaints of discrimination. 20. Kroll management failed to respond to Plaintiff’s repeated phone call inquiries with any followup. In addition, with each successive call to management or HR, the recipient of the call professed ignorance of the information and complaints Plaintiff had previously conveyed. To remedy these efforts at feigned ignorance, on May 29, 2015, Plaintiff complained to CEO Conti directly. Conti also failed to take action, and instead told Plaintiff it would take time to consider the issue without specifying how much time or what this consideration would entail. Plaintiff pressed for clarification, and Conti responded by falsely implying that Plaintiff was seeking to get special treatment as a gay man. 21. In research conducted on his own time in March 2015, Plaintiff Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 7 of 31 Page ID #:409 Exhibit 1 - Page 7 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 15 of 117 Page ID #:490 8 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 had discovered that a company named Vipshop, a Chinese e-business listed on the New York Stock Exchange (“NYSE”), had published earnings reports that contained deliberate misstatements. Plaintiff reported these inaccuracies to the SEC and wrote an article about it under a pseudonym of Mithra Research on the crowd- sourced investment newsletter website Seeking Alpha. 22. On or about the second day of June 2015, Plaintiff was contacted by Betsy Blumenthal about the anonymous report Plaintiff had authored on Vipshop. After hearing from Blumenthal, Plaintiff promptly disclosed his SEC report to CEO Conti, as well as a previous report he had made to the SEC. 23. In disregard of Sarbanes-Oxley rules, Kroll launched an “investigation” of this report and the accompanying article by Mr. Glapion. On or about June 3, 2015, Plaintiff requested an update on the status of HR’s discrimination investigation from Lisa Carey. Carey’s comments indicated that she had not even begun an investigation, despite Plaintiff’s repeated complaints and in contrast to the rapid “investigation” that had commenced against Plaintiff upon Kroll learning that Plaintiff had reported fraud. When pressed by Plaintiff, Carey informed him that she would need to “speak to Manny”, meaning Conti, the CEO. Thus, despite Plaintiff’s repeated complaints of discrimination, Kroll HR was refusing to conduct an investigation because the CEO refused to give them permission to do so. 24. On June 4, 2015, a meeting occurred regarding Kroll’s investigation into Plaintiff’s SEC complaints and the article exposing Vipshop. Plaintiff was later told by CEO Conti that the investigation into Plaintiff’s work on Vipshop had uncovered violations of Kroll’s company policy. Conti claimed that Plaintiff’s use of his computer and the Kroll logo were violations, but Conti was forced to acknowledge that Kroll had previously granted permission for Plaintiff to use his computer and the Kroll logo for outside work. The second claim violation Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 8 of 31 Page ID #:410 Exhibit 1 - Page 8 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 16 of 117 Page ID #:491 9 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 was simply that Plaintiff’s work had harmed a client who had invested in Vipshop. This client had been allegedly harmed because Vipshop was no longer as valueable since its fraud was exposed to the SEC and the investing public. In short, Conti informed Plaintiff that it was a violation of Kroll’s policy to oppose fraud, if Kroll or its clients were benefiting from the fraud. 25. On June 16, 2015, these purported violations were invoked by Kroll as justification for termination of Plaintiff. Plaintiff requested to know what had been done regarding the complaints he had made with respect to the discrimination. Conti insisted an “investigation” had been conducted. Plaintiff noted that no one had ever done a detailed interview with him, nor told him of any outcome in this “investigation.” Conti then changed his position, and stated that Plaintiff was only raising this because he was being terminated from his employment. Conti was visibly angry at being forced to acknowledge that, on his orders, no investigation had been conducted despite repeated complaints, and that Conti’s statement that an investigation had been conducted was demonstrably false. 26. Defendants discriminated against, harassed, and ultimately terminated Mr. Glapion for his race, sexual orientation, and in retaliation for his complaints of discrimination and other unlawful conduct including violation of the three key tenets of the Dodd-Frank act. 27. Defendants were compensating Mr. Glapion at an amount in excess of $435,000 annually, including salary, medical benefits, 401(k) with a 5% match, stock options and bonuses. In the year since Defendants’ wrongful termination of his employment, Plaintiff has sought but not obtained comparable employment. Plaintiff is informed and believed and based thereon alleges that Defendants’ pretext reason for termination, falsely claimed by Defendants as their actual reason, has heavily undermined his prospects of locating comparable employment. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 9 of 31 Page ID #:411 Exhibit 1 - Page 9 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 17 of 117 Page ID #:492 10 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 FIRST CAUSE OF ACTION (Sexual Orientation Discrimination) (Against All Defendants) 28. Plaintiff re-alleges and incorporates by reference the foregoing allegations as though set forth herein. 29. This cause of action is based upon Cal. Government Code §12940, including §12940(a), which makes it an unlawful employment practice for an employer, because of a person’s sexual orientation, to refuse to hire or employ the person, to bar or discharge the person from employment, or to discriminate against the person in compensation or in terms, conditions, or privileges of employment. 30. Plaintiff has met all of the jurisdictional requirements for proceeding with his claims under the California Fair Employment and Housing Act by filing charges that defendants discriminated against him and terminated his employment because of his sexual orientation in violation of the California Fair Employment and Housing Act. Plaintiff was issued a Notice of Case Closure/Right- to-Sue Letter which granted Plaintiff the right to bring suit against Defendants. 31. At all times herein mentioned, Cal. Government Code §12940 was in full force and effect, and was binding upon Defendants. Defendants violated this code section by taking adverse action against Plaintiff because of his sexual orientation, including but not limited to terminating Plaintiff’s employment. 32. As a direct, foreseeable, and proximate result of the conduct complained of in this cause of action, Plaintiff has suffered, and continues to suffer, loss of salary, benefits and bonuses plus expenses incurred in obtaining substitute employment and not being regularly employed for months, all to plaintiff’s damage in a sum within the jurisdiction of this court, to be ascertain according to proof. These damages, currently in excess of $450,000, continue to accrue. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 10 of 31 Page ID #:412 Exhibit 1 - Page 10 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 18 of 117 Page ID #:493 11 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 33. As a further direct and proximate result of said defendants' unlawful discrimination, plaintiff has suffered and continues to suffer from emotional and mental distress, and has incurred and continues to incur special and general damages, in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $900,000, continue to accrue. 34. Plaintiff also prays for reasonable costs and attorney fees against said defendants, as allowed by California Government Code §12965 and any other applicable statutes for plaintiff's prosecution of this action in reference to the time plaintiff's attorney spends pursuing this cause of action as well as any other applicable statutes. 35. Plaintiff is informed, believes, and based thereon, alleges that the outrageous conduct of said Defendants described above were done with oppression and malice by the Plaintiff's supervisor and managers and were ratified by those other individuals who were managing agents of said Defendant employers. These unlawful acts were further ratified by the Defendant employers and done with a conscious disregard for the Plaintiff's rights and with the intent, design and purpose of injuring the Plaintiff. By reason thereof, the Plaintiff is entitled to punitive or exemplary damages against said Defendants, and each of them, for their acts as described in this cause of action in a sum to be determined at the time of trial. SECOND CAUSE OF ACTION (Sexual Orientation Harassment) (Against All Defendants) 36. Plaintiff incorporates by reference the foregoing allegations as though fully set forth herein. 37. As alleged herein and in violation of California Government Code § 12940(j), Defendant violated FEHA by, among other things, harassing Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 11 of 31 Page ID #:413 Exhibit 1 - Page 11 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 19 of 117 Page ID #:494 12 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiff. Under the FEHA, it is an unlawful practice to harass a person because of the person’s age, and an employer is required to take all reasonable steps to prevent harassment from occurring. 38. Defendants’ harassment of Plaintiff because of his sexual orientation included, but is not limited to, Kroll Inc.’s employees’ anti-gay discriminatory remarks toward Plaintiff in emails and Kroll Inc.’s HR repeated failure to respond to Plaintiff’s phone inquiries. 39. The aforementioned harassing conduct described herein above was unwelcome and sufficiently severe and pervasive that it had the purpose and effect of altering the conditions of Plaintiff’s employment and created an intimidating, hostile, abusive and offensive working environment. 40. As a direct and proximate result of Defendants’ conduct as described above, Plaintiff has sustained and continues to sustain substantial losses in earnings and other employment benefits all to plaintiff’s damage in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $450,000, continue to accrue. 41. As a direct and proximate result of Defendants’ conduct as described herein, Plaintiff has suffered and continues to suffer humiliation, emotional distress, and physical and mental pain and anguish, all to his damage in a sum according to proof. These damages, currently in excess of $900,000, continue to accrue. 42. Defendants have committed the acts herein alleged maliciously and oppressively, with the wrongful intention of injuring Plaintiff, with an improper and intentional motive amounting to malice and in conscious disregard of Plaintiff’s rights. Accordingly, Plaintiff requests the assessment of punitive damages against Defendant in an amount appropriate to punish and make an example of them. 43. Plaintiff is entitled to attorneys’ fees and costs under Cal. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 12 of 31 Page ID #:414 Exhibit 1 - Page 12 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 20 of 117 Page ID #:495 13 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Government Code § 12965. THIRD CAUSE OF ACTION (Race Discrimination) (Against All Defendants) 44. Plaintiff re-alleges and incorporates by reference the foregoing allegations as though set forth herein. 45. This cause of action is based upon Cal. Government Code §12940, including §12940(a), which makes it an unlawful employment practice for an employer, because of a person’s race, to refuse to hire or employ the person, to bar or discharge the person from employment, or to discriminate against the person in compensation or in terms, conditions, or privileges of employment. 46. Plaintiff has met all of the jurisdictional requirements for proceeding with his claims under the California Fair Employment and Housing Act by filing charges that defendants discriminated against him and terminated his employment because of his race in violation of the California Fair Employment and Housing Act. Plaintiff was issued a Notice of Case Closure/Right-to-Sue Letter which granted Plaintiff the right to bring suit against Defendants. 47. At all times herein mentioned, Cal. Government Code §12940 was in full force and effect, and was binding upon Defendants. Defendants violated this code section by taking adverse action against Plaintiff because of his race, including but not limited to terminating Plaintiff’s employment. 48. As a direct, foreseeable, and proximate result of the conduct complained of in this cause of action, Plaintiff has suffered, and continues to suffer, loss of salary, benefits and bonuses plus expenses incurred in obtaining substitute employment and not being regularly employed for months, all to plaintiff’s damage in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $450,000, continue to accrue. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 13 of 31 Page ID #:415 Exhibit 1 - Page 13 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 21 of 117 Page ID #:496 14 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 49. As a further direct and proximate result of said defendants' unlawful discrimination, plaintiff has suffered and continues to suffer from emotional and mental distress, and has incurred and continues to incur special and general damages, in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $900,000, continue to accrue. 50. Plaintiff also prays for reasonable costs and attorney fees against said defendants, as allowed by California Government Code §12965 and any other applicable statutes for plaintiff's prosecution of this action in reference to the time plaintiff's attorney spends pursuing this cause of action as well as any other applicable statutes. 51. Plaintiff is informed, believes, and based thereon, alleges that the outrageous conduct of said Defendants described above were done with oppression and malice by the Plaintiff's supervisor and managers and were ratified by those other individuals who were managing agents of said Defendant employers. These unlawful acts were further ratified by the Defendant employers and done with a conscious disregard for the Plaintiff's rights and with the intent, design and purpose of injuring the Plaintiff. By reason thereof, the Plaintiff is entitled to punitive or exemplary damages against said Defendants, and each of them, for their acts as described in this cause of action in a sum to be determined at the time of trial. FOURTH CAUSE OF ACTION (Retaliation for Complaints of Sexual Orientation Harassment and Discrimination) (Against All Defendants) 52. Plaintiff incorporates by reference the foregoing allegations as though fully set forth herein. 53. This cause of action is based upon California statutes prohibiting Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 14 of 31 Page ID #:416 Exhibit 1 - Page 14 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 22 of 117 Page ID #:497 15 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 retaliation for protesting sexual orientation harassment and discrimination in the workplace including, but not limited to: a. California Government Code Sections 12940, et seq. which prohibits employers from retaliating against employees for their complaints of sexual orientation harassment and discrimination; b. California Government Code Section 12940(h) which prohibits employers from discriminating against a person because the person has opposed any practices forbidden under California Government Code Section 12940, et seq. 54. Plaintiff is informed, believes, and alleges that at all times Plaintiff was employed by defendants, all named Defendants, and each of them, did affirmative acts as described in the general allegations herein that constituted retaliation after plaintiff made the complaints as herein alleged. Defendants knowingly and intentionally engaged in said unwelcome retaliatory behavior due to Plaintiff’s repeated complaints and protestations. 55. Plaintiff is informed, believes, and alleges that Kroll Inc. and Kroll Associates Inc. are strictly liable for the retaliatory conduct of CEO Conti and other managers because they were supervisory managers of Kroll Inc. and Kroll Associates Inc. who were acting as Plaintiff’s supervisors, with the power to deny promotion and fire Plaintiff at all relevant times herein. 56. As a direct, foreseeable, and proximate result of the conduct of all Defendants named in this cause of action, and each of them, the Plaintiff has suffered, and continues to suffer emotional distress, medical expenses, substantial losses in salary, bonuses, job benefits, and other employment benefits which he would have received from Defendant had he not been subject to harassment, discrimination, and retaliation, in a sum within the jurisdiction of this court, to be ascertain according to proof. These damages, currently in excess of $450,000, Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 15 of 31 Page ID #:417 Exhibit 1 - Page 15 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 23 of 117 Page ID #:498 16 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 continue to accrue. FIFTH CAUSE OF ACTION (Failure to Prevent and/or Remedy Discrimination, Harassment and Retaliation) (Against All Defendants) 57. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 58. As described hereinabove and hereafter, the Defendants and each of them, created and maintained a workplace that supported and allowed for harassment, discrimination and retaliation against the Plaintiff, and others similarly situated, for all of those reasons set forth herein. Despite Defendants’ knowledge of same, the Defendants, and each of them, failed to take all reasonable steps necessary, required and appropriate to prevent such discrimination, harassment and retaliation in the employment environment, and particularly against the Plaintiff, from occurring. Further, the Defendants, and each of them, knew or should have known of the discrimination, harassment and retaliation against Plaintiff described above, yet still failed to conduct an adequate investigation into the nature and substance of the discrimination/harassment/retaliation and then thereafter, and at all times, failed to take immediate and appropriate corrective action so as to discipline any of the offenders despite gaining knowledge of such actions as described herein in spite of failed or non-existent investigations by it. 59. The response of Defendants, and each of them and/or their agents/employees, to the knowledge of such discrimination occurring in the workplace environment was so inadequate as to establish a deliberate indifference to, or tacit authorization of, the alleged offensive practices, and thereby an affirmative causal link existed and exists between the Defendants’ inaction and the injuries suffered by Plaintiff. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 16 of 31 Page ID #:418 Exhibit 1 - Page 16 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 24 of 117 Page ID #:499 17 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 60. By failing to take all reasonable steps necessary to prevent discrimination, harassment and retaliation, and by failing to properly investigate and remedy the discrimination, harassment and retaliation that occurred, the Defendants committed unlawful employment practices as described and prohibited in California Government Code §12940(k). 61. In engaging in the aforementioned conduct, Defendants, and each of them, aided, abetted, incited, compelled, and/or coerced unlawful employment practices in violation of the announced public policies against such practices. 62. As a direct and foreseeable result of the aforesaid acts of said Defendants, Plaintiff has lost and will continue to lose income and benefits in an amount to be proven at the time of trial. 63. As a result of the aforesaid acts of Defendants, Plaintiff claims general damages for physical and mental pain and emotional distress and aggravation in an amount to be proven at the time of trial. 64. The above described acts of Defendants, by and through their managing agents, officers or directors, were engaged in with a deliberate, cold, callous, fraudulent and intentional manner in order to injure and damage Plaintiff and/or with a conscious disregard of Plaintiff and Plaintiff’s rights. These unlawful acts were further ratified by the Defendant employers and done with a conscious disregard for the Plaintiff's rights and with the intent, design and purpose of injuring the Plaintiff. Such acts were despicable, and constitute malice, fraud and/or oppression within the meaning of California Civil Code §3294. Accordingly, Plaintiff requests an assessment of punitive damages against Defendants, in an amount to be proven at time of trial, and based in part upon Defendant’s earnings. 65. As result of the Defendants’ discriminatory, harassing, retaliatory and other illegal and prohibited acts as alleged herein, Plaintiff is entitled Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 17 of 31 Page ID #:419 Exhibit 1 - Page 17 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 25 of 117 Page ID #:500 18 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 to reasonable attorney’s fees and costs of suit as provided in and under California Government Code §12965 and other laws as may apply including California Civil Code §1021.5. SIXTH CAUSE OF ACTION (Retaliation in Violation of Cal. Lab. Code § 1102.5 et. seq.) (Against All Defendants) 66. Plaintiff incorporates by reference the foregoing allegations as though fully set forth herein. 67. Plaintiff was retaliated against in violation of the protections of California Labor Code §§ 1102.5, including but not limited to: (b) An employer, or any person acting on behalf of the employer, shall not retaliate against an employee for disclosing information, or because the employer believes that the employee disclosed or may disclose 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. (c) An employer, or any person acting on behalf of the employer, shall not retaliate against an employee for refusing to participate in an activity that would result in a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation. 68. Plaintiff was retaliated against and ultimately terminated by Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 18 of 31 Page ID #:420 Exhibit 1 - Page 18 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 26 of 117 Page ID #:501 19 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Defendants because Plaintiff disclosed information that he had reasonable cause to believe constituted a violation of state or federal law and that Defendants was required to report it to a governmental agency, and/or that Defendants feared Plaintiff would report to a governmental agency, and/or because Plaintiff refused to participate in an activity that violates a state or federal law. These violations included the harassment and discrimination Plaintiff faced in the work place. Additionally, Plaintiff was terminated after he discovered and reported a company was publishing reports that contained deliberate misstatements. 69. As a direct and foreseeable result of the aforesaid acts of said Defendants, Plaintiff has lost and will continue to lose income and benefits in an amount to be proven at the time of trial. Plaintiff claims such amount as damages, along with the civil penalty together with pre-judgment interest pursuant to Civil Code § 3287 and/or any other provision of law providing for pre-judgment interest. 70. As a result of the aforesaid acts of Defendants, Plaintiff claims damages for emotional distress, general anxiety, grief, shame, humiliation, embarrassment, anger, disappointment and worry, all to his general damage, at a minimum, in excess of the maximum jurisdiction of the court. These damages, currently in excess of $900,000, continue to accrue. 71. As a further direct and proximate result of the wrongful conduct of Defendant, Plaintiff has suffered general damages, losses in earnings, bonuses, deferred compensation, employment benefits, earning capacity, opportunities for advancement, work experience, and out-of-pocket expenses and consequential damages, with all of his damages in excess of the minimum jurisdiction of this Court and according to proof. 72. The acts of Defendants and each of them were performed with the knowledge and threat of an employer's economic power over its employee. The above described acts of Defendants, by and through their managing agents, officers Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 19 of 31 Page ID #:421 Exhibit 1 - Page 19 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 27 of 117 Page ID #:502 20 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 or directors, were engaged in with a deliberate, cold, callous, fraudulent and intentional manner in order to injure and damage Plaintiff and/or with a conscious disregard of Plaintiff and his rights. The acts and omissions to act by Plaintiff’s supervisors, were approved, tolerated, ratified and condoned by CEO Conti. Such acts were despicable, and constitute malice, fraud and/or oppression within the meaning of Civil Code § 3294. Plaintiff requests an assessment of punitive damages against Defendants, in an amount to be proven at time of trial, and based in part of Defendants’ earnings. 73. Plaintiff will also seek and is entitled to recover attorney's fees in connection with this cause of action under the private attorney general doctrine (Civil Code § 1021.5). SEVENTH CAUSE OF ACTION (Violation of Whistleblower Protection under the Sarbanes Oxley Act (18 U.S.C. § 1514A, et seq.) (Against All Defendants) 74. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 75. Plaintiff is an employee, and Defendants are employers, within the meaning of the Sarbanes-Oxley At of 2002, Public Law 107-204; 18 U.S.C. §1514A. 76. Plaintiff engaged in activity that is legally protected under the Sarbanes-Oxley Act by reporting and/or refusing to engage in conduct that he reasonably believed violated the law, and the Act's requirements. 77. Kroll Associates, Inc. serves as a contractor and subcontractor to public companies. Kroll Associates, Inc. functions as a risk consultancy which conducts forensic audit, compliance and investment work on behalf of public companies, investment banks, hedge funds and law firms. In Lawson v. FMR LLC, Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 20 of 31 Page ID #:422 Exhibit 1 - Page 20 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 28 of 117 Page ID #:503 21 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 134 S. Ct. 1158 (2014), the United States Supreme Court held that whistleblower protection under Sarbanes–Oxley (18 U.S.C. Section 1514A (a)) extended to employees of private contractors and subcontractors serving public companies. 78. At all times herein, Kroll Associates, Inc. did and continues to serve as a subcontractor for Vipshop and its bankers, Deutsche Bank and Goldman Sachs, Vipshop’s lawyers, Skadden Arps and Simpson & Thatcher, as well as at least two of Vipshop's institutional owners, Tiger Global and JP Morgan. 79. With respect to Plaintiff’s first SEC complaint regarding AmerisourceBergen, Kroll Associates, Inc. was a contractor or subcontractor for Walgreens, a majority owner of AmerisourceBergen. Additionally, Kroll Associates, Inc. was a contractor or subcontractor for AmerisourceBergen’s investment bankers through Bank of America Merrill Lynch and their legal counsel Cravath Swaine & Moore. 80. Kroll Associates, Inc. serves as a contractor or subcontractor to Vipshop and AmerisourceBergen, both SEC regulated entities for the purpose of this cause of action. 81. Defendant's conduct in ostracizing, humiliating and terminating Plaintiff, as described in more detail above, constitutes unlawful retaliation under the Act. 82. As a proximate result of Defendants’ actions, Plaintiff has suffered and continues to suffer substantial loss of earnings and other employment benefits, and has suffered and continues to suffer pain, embarrassment, humiliation and mental anguish, all to his damage according to proof. These damages, currently in excess of $900,000, continue to accrue. 83. Moreover, Plaintiff has been forced to incur and will incur attorney's fees and costs in prosecuting this action, which Plaintiff seeks to recover. /// Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 21 of 31 Page ID #:423 Exhibit 1 - Page 21 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 29 of 117 Page ID #:504 22 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 EIGHTH CAUSE OF ACTION (Violation of Whistleblower protections of the Dodd-Frank Act Wall Street Reform and Consumer Protection Act (15 U.S.C. §78u-6)) (Against all Defendants) 84. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 85. Plaintiff is an employee, and Defendants are employer, within the meaning of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 78u-6). 86. Plaintiff engaged in activity that is legally protected under the Dodd-Frank Wall Street Reform and Consumer Protection Act. Specifically, 15 U.S.C. § 78u-6(h)(1)(A)(iii) provides that an employer may not discharge or otherwise discriminate against an individual who makes "disclosures that are required or protected under the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201, et seq.) ....” As alleged herein, Plaintiff made disclosures that are protected under the Sarbanes-Oxley Act by reporting and/or refusing to engage in conduct that he reasonably believed violated the law, and the Act's requirements. 87. Defendants’ conduct in ostracizing, humiliating and terminating Plaintiff, as described in more detail above, constitutes unlawful retaliation under the Dodd-Frank Wall Street Reform and Consumer Protection Act. 88. Defendants violated three key tenets of the Dodd-Frank Act. First, Defendants denied Plaintiff his anonymity through its efforts to uncover who had made the report about Vipshop. Second, Defendants fired Plaintiff and attempted to deny him his right to court by attempting to convince him to waive his whistleblower claims. Finally, Defendants attempted to convince Plaintiff to waive any bounty he would receive in relation to his whistleblower claims. 89. As a proximate result of Defendants’ actions, Plaintiff has Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 22 of 31 Page ID #:424 Exhibit 1 - Page 22 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 30 of 117 Page ID #:505 23 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 suffered and continues to suffer substantial loss of earnings and other employment benefits, and has suffered and continues to suffer pain, embarrassment, humiliation and mental anguish, all to his damage according to proof. These damages, currently in excess of $900,000, continue to accrue. 90. Moreover, under 15 U.S.C. §78u-6(h)(C)(i) - (iii), Plaintiff is entitled for a proven violation to "reinstatement with the same seniority status that the individual would have had, but for the discrimination," "2 times the amount of back pay otherwise, owed to the individual, with interest" and "compensation for litigation costs, expert witness fees, and reasonable attorneys' fees." NINTH CAUSE OF ACTION (Defamation) (Against All Defendants) 91. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 92. Plaintiff is informed and believes Defendants, and each of them, by the herein-described acts, conspired to, and in fact, did negligently, recklessly, and intentionally cause excessive and unsolicited internal and external publications of defamation, of and concerning Plaintiff, to third persons. These false and defamatory statements included, but were not limited to: Plaintiff was hunting straight white men, Plaintiff failed to nurture and conspired to get rid of an employee, Plaintiff was dating a male co-worker, and derogatory malevolent comments regarding Plaintiff’s sexuality. Additionally, Plaintiff’s personal folder was moved onto the Kroll shared-drive. This personal folder contained confidential, personal information, including Plaintiff’s bank and tax records as well as medical information for Plaintiff’s partner. 93. While the precise dates of these publications are not known to Plaintiff, he recently discovered, and is informed and believes, the publications may Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 23 of 31 Page ID #:425 Exhibit 1 - Page 23 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 31 of 117 Page ID #:506 24 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 have started after her termination by creating false claims regarding plaintiff for the improper purpose of giving the appearance that plaintiff's wrongful and illegal termination was justified. Plaintiff may also have been compelled to self- publication of these false claims in a search for a new job. These publications were outrageous, negligent, reckless, intentional, and maliciously published and republished by Defendants, and each of them. Plaintiff is informed and believes that the negligent, reckless, and intentional publications by Defendants, and each of them, were and continue to be, foreseeable published and republished by Defendants, their agents and employees, and recipients in the community. Plaintiff hereby seeks damages for these publications and all foreseeable republications discovered up to the time of trial. 94. During the above-described time-frame, Defendants, and each of them, conspired to, and in fact, did negligently, recklessly, and intentionally cause excessive and unsolicited publication of defamation, of and concerning Plaintiff, to third persons, who had no need or desire to know. Those third person(s) to whom these Defendants published this defamation are believed to include, but are not limited to, other agents and employees of Defendants, and each of them, and the community, all of whom are known to Defendants, and each of them, but unknown at this time to Plaintiff. 95. The defamatory publications consisted of oral and written, knowingly false and unprivileged communications, tending directly to injure Plaintiff and Plaintiff's personal, business, and professional reputation. These publications included the following false and defamatory statements (in violation of Civil Code §§ 45 and 46) with the meaning and/or substance that Plaintiff: harmed a Kroll Client, used company resources improperly in violation of company policies. These and similar statements published by Defendants, and each of them, expressly and impliedly asserted that Plaintiff was incompetent, dishonest, and a poor Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 24 of 31 Page ID #:426 Exhibit 1 - Page 24 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 32 of 117 Page ID #:507 25 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 employee. 96. Plaintiff is informed, believes and fears that these false and defamatory per se statements will continue to be published by Defendants, and each of them, and has and will result in foreseeable republications by their recipients, all to the ongoing harm and injury to Plaintiff's business, professional, and personal reputations. Plaintiff also seeks redress in this action for all foreseeable republications, including her own compelled self-publication of these defamatory statements. 97. The defamatory meaning of all of the above-described false and defamatory statements and their reference to Plaintiff, were understood by these above-referenced third person recipients and other members of the community who are known to Defendants, and each of them, but unknown to Plaintiff at this time. 98. None of Defendants' defamatory publications against Plaintiff referenced above are true. 99. The above defamatory statements were understood as assertions of fact, and not as opinion. Plaintiff is informed and believes this defamation will continue to be negligently, recklessly, and intentionally published and foreseeable republished by Defendants, and each of them, and has and will result in foreseeable republications by recipients of Defendants' publications, thereby causing additional injury and damages for which Plaintiff seeks redress by this action. 100. Each of the false defamatory per se publications set forth above were negligently, recklessly, and intentionally published in a manner equaling malice and abuse of any alleged conditional privilege (which Plaintiff denies existed), since the publications, and each of them, were made with hatred, ill will, and an intent to vex, harass, annoy, and injure Plaintiff in order to justify the illegal and cruel actions of Defendants, and each of them, to cause further damage to Plaintiff's professional and personal reputation, to cause him to be fired, to justify Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 25 of 31 Page ID #:427 Exhibit 1 - Page 25 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 33 of 117 Page ID #:508 26 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 his firing, and to retaliate against Plaintiff for prior ill will, rivalry, and disputes in retaliation for his exposing of illegal activities. 101. Each of these publications by Defendants, and each of them, were made with knowledge that no investigation supported the unsubstantiated and obviously false statements. The Defendants, and each of them, published these statements knowing them to be false, unsubstantiated by any reasonable investigation and the product of hostility. These acts of publication were known by Defendants, and each of them, to be negligent to such a degree as to be reckless. In fact, not only did Defendants, and each of them, have no reasonable basis to believe these statements, but they also had no belief in the truth of these statements, and in fact knew the statements to be false. Defendants, and each of them, excessively, negligently, and recklessly published these statements to individuals with no need to know, and who made no inquiry, and who had a mere general or idle curiosity of this information. 102. The above complained-of publications by Defendants, and each of them, were made with hatred and ill will towards Plaintiff and the design and intent to injure Plaintiff, Plaintiff's good name, his reputation, employment and future employability. Defendants, and each of them, published these statements, not with intent to protect any interest protected by any privilege, but with negligence, recklessness and/or intent to injure Plaintiff and destroy his reputation. Therefore, no privilege existed to protect any of the Defendants from liability for any of these aforementioned publications or republications. 103. As a proximate result of the publication and republication of these defamatory statements by Defendants, and each of them, Plaintiff has suffered injury to his personal, business and professional reputation including suffering embarrassment, humiliation, severe emotional distress, shunning, anguish, fear, loss of employment, and employability, and significant economic loss in the form of lost Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 26 of 31 Page ID #:428 Exhibit 1 - Page 26 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 34 of 117 Page ID #:509 27 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 wages and future earnings, all to Plaintiff's economic, emotional, and general damage in an amount according to proof. These damages, currently in excess of $900,000, continue to accrue. 104. Defendants, and each of them, committed the acts alleged herein recklessly, maliciously, fraudulently, and oppressively, with the wrongful intention of injuring Plaintiff, for an improper and evil motive amounting to malice (as described above), and which abused and/or prevented the existence of any conditional privilege, which in fact did not exist, and with a reckless and conscious disregard of Plaintiff's rights. All actions of Defendants, and each of them, their agents and employees, herein alleged were known, ratified and approved by the Defendants, and each of them. Plaintiff thus is entitled to recover punitive and exemplary damages from Defendants, and each of them, for these wanton, obnoxious, and despicable acts as allowed by law, that will sufficiently punish, make an example of, and deter future conduct by Defendants. TENTH CAUSE OF ACTION (Wrongful Termination in Violation of Public Policy) (Against All Defendants) 105. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 106. Defendants discriminated against plaintiff in violation of the Government Code section 12940 et. seq by terminating plaintiff’s employment because of his sexual orientation, and due to Plaintiff opposition to and refusal to participate in activities which would result in a violation or noncompliance with federal, state, or local regulations, including but not limited to Defendant’s discrimination toward Plaintiff due to his sexual orientation, Defendants’ failure to follow laws which allow complaints to the SEC. 107. As a direct and proximate result of Defendants’ unlawful Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 27 of 31 Page ID #:429 Exhibit 1 - Page 27 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 35 of 117 Page ID #:510 28 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 conduct, Plaintiff also suffered and continues to suffer pain and mental anguish, emotional and physical distress, and injury, humiliation, anxiety, loss of earnings, past and future, and other employment benefits and job opportunities in an amount to be determined at trial, all in excess of the Court’s jurisdiction. 108. Plaintiff prays for reasonable costs and attorney fees against said defendants, as allowed by California Government Code §12965 and any other applicable statutes for plaintiff's prosecution of this action in reference to the time plaintiff's attorney spends pursuing this cause of action as well as any other applicable statutes. 109. As more fully stated by the facts alleged above, the wrongful conduct committed and ratified by Defendants and their managing agents was done with a conscious disregard of Plaintiff’s rights with the intent to vex, injure, and annoy Plaintiff so as to cause the injuries sustained by Plaintiff, which amounts to oppression, fraud, and malice, as stated in Civil Code §3294. Plaintiff is, therefore, entitled to punitive damages in an amount to punish defendants and/or make an example of defendants to curb such conduct in the future. Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 28 of 31 Page ID #:430 Exhibit 1 - Page 28 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 36 of 117 Page ID #:511 29 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 WHEREFORE, Plaintiff prays for judgment as follows: 1. Loss of income incurred and to be incurred according to proof, currently in excess of $450,000; 2. For special and general damages in an amount to be proven at trial, currently in excess of $900,000 3. For punitive damages, as allowed by law and pursuant to the causes of action for which punitive damages are permitted, that will sufficiently punish, make an example of, and deter future conduct by Defendants; 4. For reasonable attorney’s fees and costs, including expert witness fees, pursuant to Section 12965 of the California Government Code; 5. For costs of suit incurred herein; 6. For interest provided by law including, but not limited to, Cal. Civil Code § 3291; 7. For restitution and other equitable relief; and 8. Such other relief as the Court deems just and proper. DATED: July 14, 2016 ALEXANDER KRAKOW + GLICK LLP By: _s/J. Bernard Alexander, III J. Bernard Alexander, III Joshua M. Arnold Attorneys for Plaintiff MELVIN GLAPION Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 29 of 31 Page ID #:431 Exhibit 1 - Page 29 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 37 of 117 Page ID #:512 30 SECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DEMAND FOR JURY TRIAL Plaintiff hereby demands a trial by jury. DATED: July 14, 2016 ALEXANDER KRAKOW + GLICK LLP By: s/J. Bernard Alexander, III J. Bernard Alexander, III Joshua M. Arnold Attorneys for Plaintiff MELVIN GLAPION Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 30 of 31 Page ID #:432 Exhibit 1 - Page 30 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 38 of 117 Page ID #:513 CERTIFICATE OF SERVICE I, Bernard Alexander, an employee of the City of Santa Monica, certify that on July 14, 2016, caused a true and correct copies of the foregoing be filed with the Clerk of the Court by using the CM/ECF system, which will send a notice of electronic filing to the following counsel who has registered for receipt of documents filed in this matter: 1. SECOND AMENDED COMPLAINT FOR DAMAGES COUNSEL FOR DEFENDANTS: PROVIDENCE EQUITY PARTNERS LLC Kevin E. Gaut, Esq. Valentie A. Shalamitski, Esq. Mitchell Silberberg & Knupp LLP 11377 West Olympic Boulevard Los Angeles, CA 90064-1683 T: (310) 312-2000 F: (310) 312-3100 E: keg@msk.com vas@msk.com COUNSEL FOR DEFENDANTS: PROVIDENCE EQUITY PARTNERS LLC Gary D. Friedman, Esq. (Pro Hac Vice Submitted Concurrently), Ami G. Zweig, Esq. (Pro Hac Vice Submitted Concurrently), WEIL, GOTSHAL & MANGES, LLP 767 Fifth Avenue New York, NY 10153 T:: 1 212 310 8000 F: 1 212 310 8007 E: gary.friedman@weil.com ami.zweig@weil.com COUNSEL FOR DEFENDANTS: KROLL ASSOCIATES, INC.;KROLL INCORPORATED; CORPORATE RISK HOLDINGS, LLC Megan M. Lawson Lynne C. Hermle Orrick Herrington & Sutcliffe LLP 1000 Marsch Road Menlo Park, California 94025 T: 650 614 7400 F: 650 614 7401 E: lchermle@orrick.com megan.lawson@orrick.com COUNSEL FOR DEFENDANTS: KROLL ASSOCIATES, INC.;KROLL INCORPORATED; CORPORATE RISK HOLDINGS, LLC Renee B. Phillips, Esq. Orrick, Herrington & Sutcliffe LLP 51 West 52nd Street New York, New York 10019-6142 T: 212 506 5153 F: 212 506 5151 E: rphillips@orrick.com July 14, 2016 ALEXANDER KRAKOW + GLICK LLP s/ J. Bernard Alexander, III J. Bernard Alexander, III Joshua M. Arnold 401 Wilshire Boulevard, Suite 1000 Santa Monica, CA 90401 Attorney for Plaintiff Melvin Glapion Case 2:16-cv-00828-FMO-AJW Document 39 Filed 07/14/16 Page 31 of 31 Page ID #:433 Exhibit 1 - Page 31 Case 2:16-cv- 0828-FMO-AJW Document 42-2 Filed 08/ 1/16 Page 39 of 117 Page ID #:514 EXHIBIT 2 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 40 of 117 Page ID #:515 1 FIRSTAMENDEDSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ALEXANDER KRAKOW + GLICK LLP J. Bernard Alexander, III (State Bar No.128307) Joshua M. Arnold (State Bar No. 240154) 401 Wilshire Boulevard, Suite 1000 Santa Monica, California 90401 T: 310 394 0888 | F: 310 394 0811 E: balexander@akgllp.com | jarnold@akgllp.com Attorneys for Plaintiff MELVIN GLAPION UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation; KROLL INCORPORATED, a Delaware Corporation; CORPORATE RISK HOLDINGS, LLC., a Delaware limited liability corporation; and DOES 1 through 100, inclusive, Defendants. Case No. 2:16--CV--00828--FMO--A JW FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES: 1) Sexual Orientation Discrimination; 2) Sexual Orientation Harassment; 3) Race Discrimination; 4) Retaliation for Complaints of Sexual Orientation Harassment and Discrimination; 5) Failure to Prevent and/or Remedy Discrimination, Harassment and Retaliation (Gov. Code §12940(k)); 6) Retaliation in Violation of California Labor Code § 1102.5; 7) Violation of Whistleblower Protection under the Sarbanes Oxley Act (18 U.S.C. § 1514A, et seq.); 8) Violation of Whistleblower protections of the Dodd-Frank Act Wall Street Reform and Consumer Protection Act (15 U.S.C. §78u-6); 9) Defamation; 10)Wrongful Termination in Violation of Public Policy. DEMAND FOR JURY TRIAL Exhibit 2 - Page 32 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 41 of 117 Page ID #:516 2 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiff MELVIN GLAPION (“Plaintiff”) complains and alleges as follows: INTRODUCTION Plaintiff Glapion, a gay black man, joined KROLL INCKroll Inc.’s London office in 2010 as managing director. As a result of his stellar performance in London, in late 2013, the head of North American operations invited Plaintiff to take over responsibility for the Kroll office in Los Angeles (“Kroll Los Angeles” or “Kroll Associates”). As with London, reform of the Los Angeles office required identifying underperforming employees and ending their employment with Kroll. Plaintiff terminated underperforming minority employees in Los Angeles without incident, but he received a dramatically different response when he attempted to terminate underperforming white straight employees. Members of management participated in discriminatory conversations about Plaintiff that focused on his sexual orientation and implied that, as a gay black man, he was targeting straight whites. When Plaintiff complained about this discrimination, upper management and HR failed to take action on his complaints. On June 2, 2015, Plaintiff informed CEO Manny Conti that Plaintiff had lodged a complaint with the SEC regarding Vipshop, a Chinese e-business listed on the New York Stock Exchange (“NYSE”). Following this disclosure, Conti instructed Plaintiff to meet with external counsel regarding this SEC complaint, and he was grilled for several hours. On June 16, 2015, Defendant terminated Plaintiff’s employment in retaliation for his actions to expose Vipshop’s fraud. ALLEGATIONS COMMON TO ALL CAUSES OF ACTION PARTIES 1. Plaintiff MELVIN GLAPION (“Plaintiff” or “Glapion”) is, and at all relevant times mentioned herein was, an individual residing in the State of California, City of Los Angeles. Plaintiff was employed by Defendant KROLL INCORPORATED (“Kroll INC.”) and Defendant KROLL ASSOCIATES Exhibit 2 - Page 33 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 42 of 117 Page ID #:517 3 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 INCORPORATED (“Kroll Los Angeles” or “Kroll Associates”) from approximately 2010 through June 16, 2015, working his way to the position of the head of the Los Angeles office. 2. Plaintiff is informed and believes and based thereon alleges that Defendant KROLL INCORPORATED is, and at all times mentioned, was a Delaware corporation headquartered in New York and doing business in the State of California, city of Los Angeles. 2. 3. Plaintiff is informed and believes and based thereon alleges that Defendant KROLL ASSOCIATES INCORPORATED is, and at all times mentioned, was a Delaware corporation doing business in the State of California, city of Los Angeles. 4. Plaintiff is informed and believes and based thereon alleges that Defendant ALTEGRITY INCORPORATED (“Altegrity”), is and at times mentioned herein was a Delaware corporation headquartered in the state of New York and doing business in Los Angeles. At times mentioned herein, Altegrity was Kroll’s corporate parent company. 5. Plaintiff is informed and believes and based thereon alleges that Defendant CORPORATE RISK HOLDINGS, LLC., is and at all times mentioned was a Delaware limited liability corporation headquartered in the state of New York and doing business in Los Angeles. At times mentioned herein, Corporate Risk Holdings, LLC was Kroll’s corporate parent company. Corporate Risk Holdings, LLC operates as a subsidiary of Altegrity Inc. 3. 6. At all relevant times, Defendants were employers as defined by sections 12926 and 12940 of the California Fair Employment and Housing Act (FEHA). With respect to Plaintiff’s claims for compensatory and punitive damages, Defendants are employers of more than five hundred (500) persons. 4. 7. Section 2(H) of Industrial Wage Commission (“IWC”) Order Number 4-2001 defines an “employer” as any “person as defined in Section 18 of the Exhibit 2 - Page 34 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 43 of 117 Page ID #:518 4 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 [California] Labor Code, who directly or indirectly, or through an agent or any other person, employs or exercises control over the wages, hours, or working conditions of any person.” Plaintiff is informed, believes, and alleges that Defendants directly, indirectly, or acting through the agency of each other, employ or exercise control over Plaintiff’s wages, hours, or working conditions. Specifically, Defendants direct and control, with the assistance of or through the other named Defendants, the terms and conditions of Plaintiff’s employment. Accordingly, Defendants are deemed to be Plaintiff’s joint employers. 8. Plaintiff does not know the true names or capacities of the Defendants sued as DOES 1 through 100, inclusive, and by reason thereof sues these Defendants under such fictitious names. When their true names and capacities have been ascertained, Plaintiff will amend this Complaint to reflect the same. Plaintiff is informed and believes and based thereon alleges that such fictitiously named Defendants were the agents, servants, and employees of each of the named Defendants and, in doing the acts and things hereinafter alleged, were at all times acting within the course and scope of said agency, servitude, and employment and with the permission, consent, and approval, or subsequent ratification, of each of the named Defendants. Plaintiff further alleges that Defendants constituted an “integrated enterprise” and “integrated employers” with interrelated operations, common management, centralized control of labor relations, and common ownership and/or financial control. Plaintiff also alleges that the Defendants were, at all times relevant hereto, the alter egos of each other, and/or the agents of each other. Whenever reference is made to Defendants, it is intended to include all of the named Defendants as well as the DOE Defendants. Each of the fictitiously named DOE Defendants is responsible in some manner for the occurrences alleged and proximately caused Plaintiff’s damages. Exhibit 2 - Page 35 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 44 of 117 Page ID #:519 5 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 EXHAUSTION OF REMEDIES 5. 9. On September 1, 2015, Plaintiff filed a timely complaint under the Sarbanes-Oxley with the Department of Labor’s Occupational Health and Safety Administration (“OSHA”). On October 20, 2015, The Department of Labor, through its agent, issued a finding that Defendants Kroll Inc., Kroll Associates Inc. Altegrity, Inc., were not publically traded companies, or fell within the meaning of 18 U.S.C. § 1514A, because Defendants do not possess securities registered under Section 12 of the Securities Exchange Act of 1934 (15 U.S.C. 781) and is required to file reports under Section 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. §780(d)). Plaintiff timely appealed these findings before an Administrative Law Judge on November 16, 2015. On March 1, 2016, more than 180 days had passed since Plaintiff’s initial OSHA filing, exhausting this administrative remedy. On March 4, 2016, pursuant to the suggestedsuggestion of the Administrative Law Judge Richard M. Clark, the ALJ assigned to the matter, Plaintiff requested a dismissal of the OSHA complaint so that the matter may be fully adjudicated in federal court in this action. The dismissal, with the ALJ notation that the matter was to be adjudicated in federal court, was dismissed by Judge Clark on March 9, 2016. 6. 10. Plaintiff has filed a timely charge of discrimination with the California Department of Fair Employment and Housing, and has received a “right-to-sue” notice for all state law discrimination claims alleged herein. This suit is brought within one year of Plaintiffs “right-to-sue” letter. JURISDICTION AND VENUE 7. 11. The Court has jurisdiction over this action because Plaintiff s claims arise under federal statutes. This Court has subject matter jurisdiction over these claims pursuant to the Sarbanes Oxley Act as codified in 18 U.S.C. § 1514A, et seq. and the Whistleblower protections of the Dodd-Frank Act Wall Street Reform and Consumer Protection Act in 15 U.S.C. §78u-6 which vests federal jurisdiction in Exhibit 2 - Page 36 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 45 of 117 Page ID #:520 6 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 the District court. Venue is appropriate because the actions which form the basis for Plaintiff s claims occurred in Los Angeles, which is within this District. 8. 12. This Court has general personal jurisdiction over Defendants because, at all relevant times, Defendants had systematic and continuous contacts with the State of California. Defendants are registered to do business in California and are participating in major business operations in California. This Court also has specific personal jurisdiction over Defendants because the claims in this action all stem from Defendants’ specific contacts with the State of California, namely the control they exercised over Plaintiff in Los Angeles, California. 9. 13. Additionally, this Court has subject matter jurisdiction over these claims pursuant to 28 U.S.C. § 1332 and 28 U.S.C. § 1337. As set forth in the paragraphs below, the amount in controversy is at least $250,000. 10. 14. Venue is proper in the Central District of California because Plaintiff’s claim for relief arose out of Defendants’ control of Plaintiff in Los Angeles, California, where all relevant events and omissions supporting Plaintiff’s claims for relief occurred. DEMAND FOR JURY TRIAL 11. 15. Plaintiff hereby demands a jury trial as provided by Rule 38(a) of the Federal Rules of Civil Procedure. FACTUAL ALLEGATIONS 12. 16. Kroll hired Plaintiff as managing director of Kroll’s London office in 2010. As a result of Plaintiff s successful management and staff reorganization in London, he was asked to move to the Los Angeles office. Mr. Glapion began working in the Los Angeles office in October 2013 and by January 2014 was working exclusively in Los Angeles. 13. 17. By late 2013, Plaintiff had supervised the Los Angeles employees for a sufficient time to begin the reorganization of the office. After this Exhibit 2 - Page 37 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 46 of 117 Page ID #:521 7 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 review, he recommended three employees be terminated due to their performance, and management was supportive of these terminations. 14. 18. In August 2014, Kroll CEO Manny Conti requested that office heads rate their employees’ performance. Plaintiff identified one employee remaining in his office as a poor performer, Josh Lichtman. While Plaintiff had terminated other underperforming employees without interference, the reaction to Plaintiff’s recommendation to terminate this straight white male was starkly different. Although North America HR director Dan Watson had previously acknowledged that the obvious shortcomings of this Lichtman’s performance meant that creation of a Performance Improvement Plan (“PIP”) was futile, and that termination should proceed immediately, other members of management objected and announced their intention to “establish a task force” to save Lichtman. Despite the acknowledgement that such an effort was futile, Plaintiff was instructed to prepare a PIP. Plaintiff had previously terminated employees for underperformance who were not straight white men without any requirement to extend a PIP, and observed that this special standard appeared to exist only for straight white males. 15. 19. Mr. Glapion issued the PIP as directed. However, rather than work to meet the PIP goals, the Lichtman contacted San Francisco Director Betsy Blumenthal and other non-LA office employees in an effort to save his job rather than do his job. Not only was Licthman not disciplined for this departure from the PIP, he was given multiple extensions on his deadline to achieve the goals set by the PIP, partially as a result of Blumenthal moving to interfere in the PIP at his behest. 16. 20. During this same time frame, members of Kroll Los Angeles upper management began to direct discriminatory comments toward Plaintiff. Director Mark Noellinger commented to a co-worker that Plaintiff was “hunting straight white males” who did not fit with his vision of a “gays-only office.” Noellinger also implied that Plaintiff was dating a male coworker, a false allegation. Exhibit 2 - Page 38 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 47 of 117 Page ID #:522 8 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Remarks such as these were made to members of Plaintiff’s office, and occurred in both conversations and email exchanges. These discriminatory comments made Plaintiff concerned for his own future at Kroll, as the comments that Plaintiff, a gay black man, was “hunting” straight whites showed a discriminatory motive to oppose Plaintiff’s personnel decisions due to his race and sexual orientation. 17. 21. The PIP had been scheduled to last for only 8 weeks, but with extensions wound up lasting almost 8 months. Eventually, Lichtman was terminated in April 2014, but only after he was paid 9 months’ salary as severance. In the wake of this termination, more defamatory remarks were directed at Plaintiff. Blumethal announced to her staff that she was “ashamed” of the fact that Plaintiff had terminated Lichtman, and implied that it was a personal vendetta on the part of Plaintiff. 18. 22. After the termination, Plaintiff reviewed Lichtman’s emails, and discovered a number of anti-gay comments as well as emails from managers encouraging Plaintiff’s subordinate to undermine Plaintiff and ignore the PIP. These emails repeatedly made mocking and negative reference to Plaintiff’s sexual orientation, and discussed Plaintiff’s sexual orientation in the context of Kroll managers and employees seeking to block Plaintiff’s ability to manage his office. 19. 23. As a result of discovering these management level emails, Plaintiff contacted Human Resources in May 2015 on at least three separate occasions and requested that telephonic meetings be scheduled with the authors of the comments. However, despite repeated requests by Plaintiff, Kroll HR took no action. Plaintiff complained about these comments and HR’s failure to remedy them. HR continued to refuse to conduct an investigation of Plaintiff’s repeated complaints of discrimination. 20. 24. Kroll management failed to respond to Plaintiff’s repeated phone call inquiries with any followup. In addition, with each successive call to Exhibit 2 - Page 39 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 48 of 117 Page ID #:523 9 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 management or HR, the recipient of the call professed ignorance of the information and complaints Plaintiff had previously conveyed. To remedy these efforts at feigned ignorance, on May 29, 2015, Plaintiff complained to CEO Conti directly. Conti also failed to take action, and instead told Plaintiff it would take time to consider the issue without specifying how much time or what this consideration would entail. Plaintiff pressed for clarification, and Conti responded by falsely implying that Plaintiff was seeking to get special treatment as a gay man. 21. 25. In research conducted on his own time in March 2015, Plaintiff had discovered that a company named Vipshop, a Chinese e-business listed on the New York Stock Exchange (“NYSE”), had published earnings reports that contained deliberate misstatements. Plaintiff reported these inaccuracies to the SEC and wrote an article about it under a pseudonym of Mithra Research on the crowd-sourced investment newsletter website Seeking Alpha. 22. 26. On or about the second day of June 2015, Plaintiff was contacted by Betsy Blumenthal about the anonymous report Plaintiff had authored on Vipshop. After hearing from Blumenthal, Plaintiff promptly disclosed his SEC report to CEO Conti, as well as a previous report he had made to the SEC. 23. 27. In disregard of Sarbanes-Oxley rules, Kroll launched an “investigation” of this report and the accompanying article by Mr. Glapion. On or about June 3, 2015, Plaintiff requested an update on the status of HR’s discrimination investigation from Lisa Carey, and was told. Carey’s comments indicated that she had not even begun an investigation, despite Plaintiff’s repeated complaints and in contrast to the rapid “investigation” that had commenced against Plaintiff upon Kroll learning that Plaintiff had reported fraud. When pressed by Plaintiff, Carey informed him that she would need to “speak to Manny.” Carey did not claim any investigation had even begun”, meaning Conti, the CEO. Thus, despite Plaintiff’s repeated complaints of discrimination, Kroll HR was Exhibit 2 - Page 40 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 49 of 117 Page ID #:524 10 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 refusing to conduct an investigation because the CEO refused to give them permission to do so. 24. 28. On June 4, 2015, a meeting occurred regarding Kroll’s investigation into Plaintiff’s SEC complaints and the article exposing Vipshop. Plaintiff was later told by CEO Conti that the investigation into Plaintiff’s work on Vipshop had uncovered violations of Kroll Inc.’s company policy. Conti claimed that Plaintiff’s use of his computer and the Kroll logo were violations, but Conti was forced to acknowledge that Kroll had previously granted permission for Plaintiff to use his computer and the Kroll logo for outside work. The second claim violation was simply that Plaintiff’s work had harmed a client who had invested in Vipshop. This client had been allegedly harmed because Vipshop was no longer as valueablevaluable since its fraud was exposed to the SEC and the investing public. In short, Conti informed Plaintiff that it was a violation of Kroll’s policy to oppose fraud, if Kroll or its clients were benefiting from the fraud. 25. 29. On June 16, 2015, these purported violations were invoked by Kroll as justification for termination of Plaintiff. Plaintiff requested to know what had been done regarding the complaints he had made with respect to the discrimination. Conti insisted an “investigation” had been conducted. Plaintiff noted that no one had ever done a detailed interview with him, nor told him of any outcome in this “investigation.” Conti then changed his position, and stated that Plaintiff was only raising this because he was being terminated from his employment. Conti was visibly angry at being forced to acknowledge that, on his orders, no investigation had been conducted despite repeated complaints, and that Conti’s statement that an investigation had been conducted was demonstrably false. 26. 30. Defendants discriminated against, harassed, and ultimately terminated Mr. Glapion for his race, sexual orientation, and in retaliation for his Exhibit 2 - Page 41 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 50 of 117 Page ID #:525 11 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 complaints of discrimination and other unlawful conduct including violation of the three key tenets of the Dodd-Frank act. 31. On or around September 2010, Kroll Inc. was sold by Marsh & McLennan Cos Inc. to Altegrity Inc. 32. In February of 2015, Altegrity Inc. filed for Chapter 11 Bankruptcy in Delaware federal court after losing several government contracts due to fraud. In August 31, 2015, Altegrity Inc. completed financial restructuring and emerged from Chapter 11 protection. Altegrity Inc. emerged from bankruptcy restructuring as Corporate Risk Holdings. Upon information and belief, after this restructuring, Kroll Inc. is now completely owned by Corporate Risk Holdings Inc. 27. Defendants were compensating Mr. Glapion at an amount in excess of $435,000 annually, including salary, medical benefits, 401(k) with a 5% match, stock options and bonuses. In the year since Defendants’ wrongful termination of his employment, Plaintiff has sought but not obtained comparable employment. Plaintiff is informed and believed and based thereon alleges that Defendants’ pretext reason for termination, falsely claimed by Defendants as their actual reason, has heavily undermined his prospects of locating comparable employment. FIRST CAUSE OF ACTION (Sexual Orientation Discrimination) (Against All Defendants) 28. 33. Plaintiff re-alleges and incorporates by reference the foregoing allegations as though set forth herein. 29. 34. This cause of action is based upon Cal. Government Code §12940, including §12940(a), which makes it an unlawful employment practice for an employer, because of a person’s sexual orientation, to refuse to hire or employ the person, to bar or discharge the person from employment, or to discriminate against the person in compensation or in terms, conditions, or privileges of employment. Exhibit 2 - Page 42 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 51 of 117 Page ID #:526 12 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 30. 35. Plaintiff has met all of the jurisdictional requirements for proceeding with his claims under the California Fair Employment and Housing Act by filing charges that defendants discriminated against him and terminated his employment because of his sexual orientation in violation of the California Fair Employment and Housing Act. Plaintiff was issued a Notice of Case Closure/Right-to-Sue Letter which granted Plaintiff the right to bring suit against Defendants. 31. 36. At all times herein mentioned, Cal. Government Code §12940 was in full force and effect, and was binding upon Defendants. Defendants violated this code section by taking adverse action against Plaintiff because of his sexual orientation, including but not limited to terminating Plaintiff’s employment. 32. 37. As a direct, foreseeable, and proximate result of the conduct complained of in this cause of action, Plaintiff has suffered, and continues to suffer, loss of salary, benefits and bonuses plus expenses incurred in obtaining substitute employment and not being regularly employed for months, all to plaintiff’s damage in a sum within the jurisdiction of this court, to be ascertain according to proof. These damages, currently in excess of $450,000, continue to accrue. 33. 38. As a further direct and proximate result of said defendants’ unlawful discrimination, plaintiff has suffered and continues to suffer from emotional and mental distress, and has incurred and continues to incur special and general damages, in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $900,000, continue to accrue. 34. 39. Plaintiff also prays for reasonable costs and attorney fees against said defendants, as allowed by California Government Code §12965 and any other applicable statutes for plaintiff’s prosecution of this action in reference to the time plaintiff’s attorney spends pursuing this cause of action as well as any other applicable statutes. Exhibit 2 - Page 43 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 52 of 117 Page ID #:527 13 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 35. 40. Plaintiff is informed, believes, and based thereon, alleges that the outrageous conduct of said Defendants described above were done with oppression and malice by the Plaintiff’s supervisor and managers and were ratified by those other individuals who were managing agents of said Defendant employers. These unlawful acts were further ratified by the Defendant employers and done with a conscious disregard for the Plaintiff’s rights and with the intent, design and purpose of injuring the Plaintiff. By reason thereof, the Plaintiff is entitled to punitive or exemplary damages against said Defendants, and each of them, for their acts as described in this cause of action in a sum to be determined at the time of trial. /// /// SECOND CAUSE OF ACTION (Sexual Orientation Harassment) (Against All Defendants) 36. 41. Plaintiff incorporates by reference the foregoing allegations as though fully set forth herein. 37. 42. As alleged herein and in violation of California Government Code § 12940(j), Defendant violated FEHA by, among other things, harassing Plaintiff. Under the FEHA, it is an unlawful practice to harass a person because of the person’s age, and an employer is required to take all reasonable steps to prevent harassment from occurring. 38. 43. Defendants’ harassment of Plaintiff because of his sexual orientation included, but is not limited to, Kroll Inc.’s employees’ anti-gay discriminatory remarks toward Plaintiff in emails and Kroll Inc.’s HR repeated failure to respond to Plaintiff’s phone inquiries. 39. 44. The aforementioned harassing conduct described herein above was unwelcome and sufficiently severe and pervasive that it had the purpose and Exhibit 2 - Page 44 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 53 of 117 Page ID #:528 14 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 effect of altering the conditions of Plaintiff’s employment and created an intimidating, hostile, abusive and offensive working environment. 40. 45. As a direct and proximate result of Defendants’ conduct as described above, Plaintiff has sustained and continues to sustain substantial losses in earnings and other employment benefits all to plaintiff’s damage in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $450,000, continue to accrue. 41. 46. As a direct and proximate result of Defendants’ conduct as described herein, Plaintiff has suffered and continues to suffer humiliation, emotional distress, and physical and mental pain and anguish, all to his damage in a sum according to proof. These damages, currently in excess of $900,000, continue to accrue. 42. 47. Defendants have committed the acts herein alleged maliciously and oppressively, with the wrongful intention of injuring Plaintiff, with an improper and intentional motive amounting to malice and in conscious disregard of Plaintiff’s rights. Accordingly, Plaintiff requests the assessment of punitive damages against Defendant in an amount appropriate to punish and make an example of them. 43. 48. Plaintiff is entitled to attorneys’ fees and costs under Cal. Government Code § 12965. THIRD CAUSE OF ACTION (Race Discrimination) (Against All Defendants) 44. 49. Plaintiff re-alleges and incorporates by reference the foregoing allegations as though set forth herein. 45. 50. This cause of action is based upon Cal. Government Code §12940, including §12940(a), which makes it an unlawful employment practice for an employer, because of a person’s race, to refuse to hire or employ the person, to bar Exhibit 2 - Page 45 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 54 of 117 Page ID #:529 15 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 or discharge the person from employment, or to discriminate against the person in compensation or in terms, conditions, or privileges of employment. 46. 51. Plaintiff has met all of the jurisdictional requirements for proceeding with his claims under the California Fair Employment and Housing Act by filing charges that defendants discriminated against him and terminated his employment because of his race in violation of the California Fair Employment and Housing Act. Plaintiff was issued a Notice of Case Closure/Right-to-Sue Letter which granted Plaintiff the right to bring suit against Defendants. 47. 52. At all times herein mentioned, Cal. Government Code §12940 was in full force and effect, and was binding upon Defendants. Defendants violated this code section by taking adverse action against Plaintiff because of his race, including but not limited to terminating Plaintiff’s employment. 48. 53. As a direct, foreseeable, and proximate result of the conduct complained of in this cause of action, Plaintiff has suffered, and continues to suffer, loss of salary, benefits and bonuses plus expenses incurred in obtaining substitute employment and not being regularly employed for months, all to plaintiff’s damage in a sum within the jurisdiction of this court, to be ascertainascertained according to proof. These damages, currently in excess of $450,000, continue to accrue. 49. 54. As a further direct and proximate result of said defendants’ unlawful discrimination, plaintiff has suffered and continues to suffer from emotional and mental distress, and has incurred and continues to incur special and general damages, in a sum within the jurisdiction of this court, to be ascertained according to proof. These damages, currently in excess of $900,000, continue to accrue. 50. 55. Plaintiff also prays for reasonable costs and attorney fees against said defendants, as allowed by California Government Code §12965 and any other applicable statutes for plaintiff’s prosecution of this action in reference to the time Exhibit 2 - Page 46 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 55 of 117 Page ID #:530 16 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 plaintiff’s attorney spends pursuing this cause of action as well as any other applicable statutes. 51. 56. Plaintiff is informed, believes, and based thereon, alleges that the outrageous conduct of said Defendants described above were done with oppression and malice by the Plaintiff’s supervisor and managers and were ratified by those other individuals who were managing agents of said Defendant employers. These unlawful acts were further ratified by the Defendant employers and done with a conscious disregard for the Plaintiff’s rights and with the intent, design and purpose of injuring the Plaintiff. By reason thereof, the Plaintiff is entitled to punitive or exemplary damages against said Defendants, and each of them, for their acts as described in this cause of action in a sum to be determined at the time of trial. FOURTH CAUSE OF ACTION (Retaliation for Complaints of Sexual Orientation Harassment and Discrimination) (Against All Defendants) 52. 57. Plaintiff incorporates by reference the foregoing allegations as though fully set forth herein. 53. 58. This cause of action is based upon California statutes prohibiting retaliation for protesting sexual orientation harassment and discrimination in the workplace including, but not limited to: a. California Government Code Sections 12940, et seq. which prohibits employers from retaliating against employees for their complaints of sexual orientation harassment and discrimination; b. California Government Code Section 12940(h) which prohibits employers from discriminating against a person because the person has opposed any practices forbidden under California Government Code Section 12940, et seq. Exhibit 2 - Page 47 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 56 of 117 Page ID #:531 17 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 54. 59. Plaintiff is informed, believes, and alleges that at all times Plaintiff was employed by defendants, all named Defendants, and each of them, did affirmative acts as described in the general allegations herein that constituted retaliation after plaintiff made the complaints as herein alleged. Defendants knowingly and intentionally engaged in said unwelcome retaliatory behavior due to Plaintiff’s repeated complaints and protestations. 55. 60. Plaintiff is informed, believes, and alleges that Kroll Inc. and Kroll Associates Inc. are strictly liable for the retaliatory conduct of CEO Conti and other managers because they were supervisory managers of Kroll Inc. and Kroll Associates Inc. who were acting as Plaintiff’s supervisors, with the power to deny promotion and fire Plaintiff at all relevant times herein. 56. 61. As a direct, foreseeable, and proximate result of the conduct of all Defendants named in this cause of action, and each of them, the Plaintiff has suffered, and continues to suffer emotional distress, medical expenses, substantial losses in salary, bonuses, job benefits, and other employment benefits which he would have received from Defendant had he not been subject to harassment, discrimination, and retaliation, in a sum within the jurisdiction of this court, to be ascertain according to proof. These damages, currently in excess of $450,000, continue to accrue. FIFTH CAUSE OF ACTION (Failure to Prevent and/or Remedy Discrimination, Harassment and Retaliation) (Against All Defendants) 57. 62. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 58. 63. As described hereinabove and hereafter, the Defendants and each of them, created and maintained a workplace that supported and allowed for harassment, discrimination and retaliation against the Plaintiff, and others similarly Exhibit 2 - Page 48 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 57 of 117 Page ID #:532 18 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 situated, for all of those reasons set forth herein. Despite Defendants’ knowledge of same, the Defendants, and each of them, failed to take all reasonable steps necessary, required and appropriate to prevent such discrimination, harassment and retaliation in the employment environment, and particularly against the Plaintiff, from occurring. Further, the Defendants, and each of them, knew or should have known of the discrimination, harassment and retaliation against Plaintiff described above, yet still failed to conduct an adequate investigation into the nature and substance of the discrimination/harassment/retaliation and then thereafter, and at all times, failed to take immediate and appropriate corrective action so as to discipline any of the offenders despite gaining knowledge of such actions as described herein in spite of failed or non-existent investigations by it. 59. 64. The response of Defendants, and each of them and/or their agents/employees, to the knowledge of such discrimination occurring in the workplace environment was so inadequate as to establish a deliberate indifference to, or tacit authorization of, the alleged offensive practices, and thereby an affirmative causal link existed and exists between the Defendants’ inaction and the injuries suffered by Plaintiff. 60. 65. By failing to take all reasonable steps necessary to prevent discrimination, harassment and retaliation, and by failing to properly investigate and remedy the discrimination, harassment and retaliation that occurred, the Defendants committed unlawful employment practices as described and prohibited in California Government Code §12940(k). 61. 66. In engaging in the aforementioned conduct, Defendants, and each of them, aided, abetted, incited, compelled, and/or coerced unlawful employment practices in violation of the announced public policies against such practices. Exhibit 2 - Page 49 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 58 of 117 Page ID #:533 19 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 62. 67. As a direct and foreseeable result of the aforesaid acts of said Defendants, Plaintiff has lost and will continue to lose income and benefits in an amount to be proven at the time of trial. 63. 68. As a result of the aforesaid acts of Defendants, Plaintiff claims general damages for physical and mental pain and emotional distress and aggravation in an amount to be proven at the time of trial. 64. 69. The above described acts of Defendants, by and through their managing agents, officers or directors, were engaged in with a deliberate, cold, callous, fraudulent and intentional manner in order to injure and damage Plaintiff and/or with a conscious disregard of Plaintiff and Plaintiff’s rights. These unlawful acts were further ratified by the Defendant employers and done with a conscious disregard for the Plaintiff’s rights and with the intent, design and purpose of injuring the Plaintiff. Such acts were despicable, and constitute malice, fraud and/or oppression within the meaning of California Civil Code §3294. Accordingly, Plaintiff requests an assessment of punitive damages against Defendants, in an amount to be proven at time of trial, and based in part upon Defendant’s earnings. 65. 70. As result of the Defendants’ discriminatory, harassing, retaliatory and other illegal and prohibited acts as alleged herein, Plaintiff is entitled to reasonable attorney’s fees and costs of suit as provided in and under California Government Code §12965 and other laws as may apply including California Civil Code §1021.5. SIXTH CAUSE OF ACTION (Retaliation in Violation of Cal. Lab. Code § 1102.5 et. seq.) (Against All Defendants) 66. 71. Plaintiff incorporates by reference the foregoing allegations as though fully set forth herein. Exhibit 2 - Page 50 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 59 of 117 Page ID #:534 20 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 67. 72. Plaintiff was retaliated against in violation of the protections of California Labor Code §§ 1102.5, including but not limited to: (b) An employer, or any person acting on behalf of the employer, shall not retaliate against an employee for disclosing information, or because the employer believes that the employee disclosed or may disclose 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. (c) An employer, or any person acting on behalf of the employer, shall not retaliate against an employee for refusing to participate in an activity that would result in a violation of state or federal statute, or a violation of or noncompliance with a local, state, or federal rule or regulation. 68. 73. Plaintiff was retaliated against and ultimately terminated by Defendants because Plaintiff disclosed information that he had reasonable cause to believe constituted a violation of state or federal law and that Defendants was required to report it to a governmental agency, and/or that Defendants feared Plaintiff would report to a governmental agency, and/or because Plaintiff refused to participate in an activity that violates a state or federal law. These violations included the harassment and discrimination Plaintiff faced in the work place. Additionally, Plaintiff was terminated after he discovered and reported a company was publishing reports that contained deliberate misstatements. 69. 74. As a direct and foreseeable result of the aforesaid acts of said Defendants, Plaintiff has lost and will continue to lose income and benefits in an Exhibit 2 - Page 51 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 60 of 117 Page ID #:535 21 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 amount to be proven at the time of trial. Plaintiff claims such amount as damages, along with the civil penalty together with pre-judgment interest pursuant to Civil Code § 3287 and/or any other provision of law providing for pre-judgment interest. 70. 75. As a result of the aforesaid acts of Defendants, Plaintiff claims damages for emotional distress, general anxiety, grief, shame, humiliation, embarrassment, anger, disappointment and worry, all to his general damage, at a minimum, in excess of the maximum jurisdiction of the court. These damages, currently in excess of $900,000, continue to accrue. 71. 76. As a further direct and proximate result of the wrongful conduct of Defendant, Plaintiff has suffered general damages, losses in earnings, bonuses, deferred compensation, employment benefits, earning capacity, opportunities for advancement, work experience, and out-of-pocket expenses and consequential damages, with all of his damages in excess of the minimum jurisdiction of this Court and according to proof. 72. 77. The acts of Defendants and each of them were performed with the knowledge and threat of an employer’s economic power over its employee. The above described acts of Defendants, by and through their managing agents, officers or directors, were engaged in with a deliberate, cold, callous, fraudulent and intentional manner in order to injure and damage Plaintiff and/or with a conscious disregard of Plaintiff and his rights. The acts and omissions to act by Plaintiff’s supervisors, were approved, tolerated, ratified and condoned by CEO Conti. Such acts were despicable, and constitute malice, fraud and/or oppression within the meaning of Civil Code § 3294. Plaintiff requests an assessment of punitive damages against Defendants, in an amount to be proven at time of trial, and based in part of Defendants’ earnings. 73. 78. Plaintiff will also seek and is entitled to recover attorney’s fees in connection with this cause of action under the private attorney general doctrine (Civil Code § 1021.5). Exhibit 2 - Page 52 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 61 of 117 Page ID #:536 22 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 SEVENTH CAUSE OF ACTION (Violation of Whistleblower Protection under the Sarbanes Oxley Act (18 U.S.C. § 1514A, et seq.) (Against All Defendants) 74. 79. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 75. 80. Plaintiff is an employee, and Defendants are employers, within the meaning of the Sarbanes-Oxley At of 2002, Public Law 107-204; 18 U.S.C. §1514A. 76. 81. Plaintiff engaged in activity that is legally protected under the Sarbanes-Oxley Act by reporting and/or refusing to engage in conduct that he reasonably believed violated the law, and the Act’s requirements. 82. Based on investigation and research, Kroll Associates, Inc. and Kroll, Inc. were subsidiaries of Altegrity, Inc. prior to Altegrity, Inc.’s bankruptcy, which was finalized on August 31, 2015. Since Altegrity, Inc.’s emergence from bankruptcy, Kroll Associates, Inc. and Kroll, Inc. are now subsidiaries of a newly incorporated limited liability corporation—Corporate Risk Holdings, LLC. 83. Altegrity, Inc., Kroll Associates, Inc., and Kroll, Inc., had issued bonds and filed documents for exemptions with the SEC when the bonds were first issued five (5) years prior. Additionally, as part of Altegrity, Inc’s bankruptcy proceeding, Altegrity, Inc., Kroll Associates, Inc., and Kroll, Inc., were required to notify various SEC offices of bankruptcy proceedings. 77. 84. Kroll Associates, Inc. and Kroll, Inc. serveserves as a contractor and subcontractor to public companies. Kroll Associates, Inc. and Kroll, Inc.,functions as a risk consultancy which conducts forensic audit, compliance and investment work on behalf of public companies, investment banks, hedge funds and law firms. In Lawson v. FMR LLC, 134 S. Ct. 1158 (2014), the United States Supreme Court held that Exhibit 2 - Page 53 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 62 of 117 Page ID #:537 23 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 whistleblower protection under Sarbanes–Oxley (18 U.S.C. Section 1514A (a)) extended to employees of private contractors and subcontractors serving public companies. 78. 85. At all times herein, Kroll Associates, Inc. and Kroll, Inc. did and continues to serve as a subcontractor for Vipshop and its bankers, Deutsche Bank and Goldman Sachs, Vipshop’s lawyers, Skadden Arps and Simpson & Thatcher, as well as at least two of Vipshop’s institutional owners, Tiger Global and JP Morgan. 79. 86. With respect to Plaintiff’s first SEC complaint regarding AmerisourceBergen, Kroll Associates, Inc. and Kroll, Inc. were contractors or subcontractorswas a contractor or subcontractor for Walgreens, a majority owner of AmerisourceBergen. Additionally, Kroll Associates, Inc. and Kroll, Inc. were contractors or subcontractorswas a contractor or subcontractor for AmerisourceBergen’s investment bankers through Bank of America Merrill Lynch and their legal counsel Cravath Swaine & Moore. 80. 87. Kroll Associates, Inc. and Kroll, Inc. serveserves as a contractor or subcontractor to Vipshop and AmerisourceBergen, both SEC regulated entities for the purpose of this cause of action. 81. 88. Defendant’s conduct in ostracizing, humiliating and terminating Plaintiff, as described in more detail above, constitutes unlawful retaliation under the Act. 82. 89. As a proximate result of Defendants”’ actions, Plaintiff has suffered and continues to suffer substantial loss of earnings and other employment benefits, and has suffered and continues to suffer pain, embarrassment, humiliation and mental anguish, all to his damage according to proof. These damages, currently in excess of $900,000, continue to accrue. 83. 90. Moreover, Plaintiff has been forced to incur and will incur attorney’s fees and costs in prosecuting this action, which Plaintiff seeks to recover. /// Exhibit 2 - Page 54 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 63 of 117 Page ID #:538 24 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 EIGHTH CAUSE OF ACTION (Violation of Whistleblower protections of the Dodd-Frank Act Wall Street Reform and Consumer Protection Act (15 U.S.C. §78u-6)) (Against all Defendants) 84. 91. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 85. 92. Plaintiff is an employee, and Defendants are employer, within the meaning of the Dodd-Frank Wall Street Reform and Consumer Protection Act (15 U.S.C. 78u-6). 86. 93. Plaintiff engaged in activity that is legally protected under the Dodd-Frank Wall Street Reform and Consumer Protection Act. Specifically, 15 U.S.C. § 78u-6(h)(1)(A)(iii) provides that an employer may not discharge or otherwise discriminate against an individual who makes “disclosures that are required or protected under the Sarbanes-Oxley Act of 2002 (15 U.S.C. 7201, et seq.) ....” As alleged herein, Plaintiff made disclosures that are protected under the Sarbanes-Oxley Act by reporting and/or refusing to engage in conduct that he reasonably believed violated the law, and the Act’s requirements. 87. 94. Defendants’ conduct in ostracizing, humiliating and terminating Plaintiff, as described in more detail above, constitutes unlawful retaliation under the Dodd-Frank Wall Street Reform and Consumer Protection Act. 88. 95. Defendants violated three key tenets of the Dodd-Frank Act. First, Defendants denied Plaintiff his anonymity through its efforts to uncover who had made the report about Vipshop. Second, Defendants fired Plaintiff and attempted to deny him his right to court by attempting to convince him to waive his whistleblower claims. Finally, Defendants attempted to convince Plaintiff to waive any bounty he would receive in relation to his whistleblower claims. 89. 96. As a proximate result of Defendants’ actions, Plaintiff has suffered and continues to suffer substantial loss of earnings and other employment Exhibit 2 - Page 55 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 64 of 117 Page ID #:539 25 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 benefits, and has suffered and continues to suffer pain, embarrassment, humiliation and mental anguish, all to herhis damage according to proof. These damages, currently in excess of $900,000, continue to accrue. 90. 97. Moreover, under 15 U.S.C. §78u-6(h)(C)(i) - (iii), Plaintiff is entitled for a proven violation to “reinstatement with the same seniority status that the individual would have had, but for the discrimination,” “2 times the amount of back pay otherwise, owed to the individual, with interest” and “compensation for litigation costs, expert witness fees, and reasonable attorneys’ fees.” NINTH CAUSE OF ACTION (Defamation) (Against All Defendants) 91. 98. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 92. 99. Plaintiff is informed and believes Defendants, and each of them, by the herein-described acts, conspired to, and in fact, did negligently, recklessly, and intentionally cause excessive and unsolicited internal and external publications of defamation, of and concerning Plaintiff, to third persons. These false and defamatory statements included, but were not limited to: Plaintiff was hunting straight white men, Plaintiff failed to nurture and conspired to get rid of an employee, Plaintiff was dating a male co-worker, and derogatory malevolent comments regarding Plaintiff’s sexuality. Additionally, Plaintiff’s personal folder was moved onto the Kroll Inc. shared-drive. This personal folder contained confidential, personal information, including Plaintiff’s bank and tax records as well as medical information for Plaintiff’s partner. 93. 100. While the precise dates of these publications are not known to Plaintiff, he recently discovered, and is informed and believes, the publications may have started after her termination by creating false claims regarding plaintiff for the improper purpose of giving the appearance that plaintiff’s wrongful and illegal Exhibit 2 - Page 56 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 65 of 117 Page ID #:540 26 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 termination was justified. Plaintiff may also have been compelled to self-publication of these false claims in a search for a new job. These publications were outrageous, negligent, reckless, intentional, and maliciously published and republished by Defendants, and each of them. Plaintiff is informed and believes that the negligent, reckless, and intentional publications by Defendants, and each of them, were and continue to be, foreseeable published and republished by Defendants, their agents and employees, and recipients in the community. Plaintiff hereby seeks damages for these publications and all foreseeable republications discovered up to the time of trial. 94. 101. During the above-described time-frame, Defendants, and each of them, conspired to, and in fact, did negligently, recklessly, and intentionally cause excessive and unsolicited publication of defamation, of and concerning Plaintiff, to third persons, who had no need or desire to know. Those third person(s) to whom these Defendants published this defamation are believed to include, but are not limited to, other agents and employees of Defendants, and each of them, and the community, all of whom are known to Defendants, and each of them, but unknown at this time to Plaintiff. 95. 102. The defamatory publications consisted of oral and written, knowingly false and unprivileged communications, tending directly to injure Plaintiff and Plaintiff’s personal, business, and professional reputation. These publications included the following false and defamatory statements (in violation of Civil Code §§ 45 and 46) with the meaning and/or substance that Plaintiff: harmed a Kroll Client, used company resources improperly in violation of company policies. These and similar statements published by Defendants, and each of them, expressly and impliedly asserted that Plaintiff was incompetent, dishonest, and a poor employee. 96. 103. Plaintiff is informed, believes and fears that these false and defamatory per se statements will continue to be published by Defendants, and each Exhibit 2 - Page 57 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 66 of 117 Page ID #:541 27 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 of them, and has and will result in foreseeable republications by their recipients, all to the ongoing harm and injury to Plaintiff’s business, professional, and personal reputations. Plaintiff also seeks redress in this action for all foreseeable republications, including her own compelled self-publication of these defamatory statements. 97. 104. The defamatory meaning of all of the above-described false and defamatory statements and their reference to Plaintiff, were understood by these above-referenced third person recipients and other members of the community who are known to Defendants, and each of them, but unknown to Plaintiff at this time. 98. 105. None of Defendants’ defamatory publications against Plaintiff referenced above are true. 99. 106. The above defamatory statements were understood as assertions of fact, and not as opinion. Plaintiff is informed and believes this defamation will continue to be negligently, recklessly, and intentionally published and foreseeable republished by Defendants, and each of them, and has and will result in foreseeable republications by recipients of Defendants’ publications, thereby causing additional injury and damages for which Plaintiff seeks redress by this action. 100. 107. Each of the false defamatory per se publications set forth above were negligently, recklessly, and intentionally published in a manner equaling malice and abuse of any alleged conditional privilege (which Plaintiff denies existed), since the publications, and each of them, were made with hatred, ill will, and an intent to vex, harass, annoy, and injure Plaintiff in order to justify the illegal and cruel actions of Defendants, and each of them, to cause further damage to Plaintiff’s professional and personal reputation, to cause him to be fired, to justify his firing, and to retaliate against Plaintiff for prior ill will, rivalry, and disputes in retaliation for his exposing of illegal activities. 101. 108. Each of these publications by Defendants, and each of them, were made with knowledge that no investigation supported the unsubstantiated and Exhibit 2 - Page 58 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 67 of 117 Page ID #:542 28 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 obviously false statements. The Defendants, and each of them, published these statements knowing them to be false, unsubstantiated by any reasonable investigation and the product of hostility. These acts of publication were known by Defendants, and each of them, to be negligent to such a degree as to be reckless. In fact, not only did Defendants, and each of them, have no reasonable basis to believe these statements, but they also had no belief in the truth of these statements, and in fact knew the statements to be false. Defendants, and each of them, excessively, negligently, and recklessly published these statements to individuals with no need to know, and who made no inquiry, and who had a mere general or idle curiosity of this information. 102. 109. The above complained-of publications by Defendants, and each of them, were made with hatred and ill will towards Plaintiff and the design and intent to injure Plaintiff, Plaintiff’s good name, his reputation, employment and future employability. Defendants, and each of them, published these statements, not with intent to protect any interest protected by any privilege, but with negligence, recklessness and/or intent to injure Plaintiff and destroy his reputation. Therefore, no privilege existed to protect any of the Defendants from liability for any of these aforementioned publications or republications. 103. 110. As a proximate result of the publication and republication of these defamatory statements by Defendants, and each of them, Plaintiff has suffered injury to his personal, business and professional reputation including suffering embarrassment, humiliation, severe emotional distress, shunning, anguish, fear, loss of employment, and employability, and significant economic loss in the form of lost wages and future earnings, all to Plaintiff’s economic, emotional, and general damage in an amount according to proof. These damages, currently in excess of $900,000, continue to accrue. 104. 111. Defendants, and each of them, committed the acts alleged herein recklessly, maliciously, fraudulently, and oppressively, with the wrongful Exhibit 2 - Page 59 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 68 of 117 Page ID #:543 29 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 intention of injuring Plaintiff, for an improper and evil motive amounting to malice (as described above), and which abused and/or prevented the existence of any conditional privilege, which in fact did not exist, and with a reckless and conscious disregard of Plaintiff’s rights. All actions of Defendants, and each of them, their agents and employees, herein alleged were known, ratified and approved by the Defendants, and each of them. Plaintiff thus is entitled to recover punitive and exemplary damages from Defendants, and each of them, for these wanton, obnoxious, and despicable acts as allowed by law, that will sufficiently punish, make an example of, and deter future conduct by Defendants. TENTH CAUSE OF ACTION (Wrongful Termination in Violation of Public Policy) (Against All Defendants) 105. 112. Plaintiff incorporates by reference the foregoing information and allegations as though fully set forth herein. 106. 113. Defendants discriminated against plaintiff in violation of the Government Code section 12940 et. seq by terminating plaintiff’s employment because of his sexual orientation, and due to Plaintiff opposition to and refusal to participate in activities which would result in a violation or noncompliance with federal, state, or local regulations, including but not limited to Defendant’s discrimination toward Plaintiff due to his sexual orientation, Defendants’ failure to follow laws which allow complaints to the SEC. 107. 114. As a direct and proximate result of Defendants’ unlawful conduct, Plaintiff also suffered and continues to suffer pain and mental anguish, emotional and physical distress, and injury, humiliation, anxiety, loss of earnings, past and future, and other employment benefits and job opportunities in an amount to be determined at trial, all in excess of the Court’s jurisdiction. 108. 115. Plaintiff prays for reasonable costs and attorney fees against said defendants, as allowed by California Government Code §12965 and any other Exhibit 2 - Page 60 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 69 of 117 Page ID #:544 30 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 applicable statutes for plaintiff’s prosecution of this action in reference to the time plaintiff’s attorney spends pursuing this cause of action as well as any other applicable statutes. 109. 116. As more fully stated by the facts alleged above, the wrongful conduct committed and ratified by Defendants and their managing agents was done with a conscious disregard of Plaintiff’s rights with the intent to vex, injure, and annoy Plaintiff so as to cause the injuries sustained by Plaintiff, which amounts to oppression, fraud, and malice, as stated in Civil Code §3294. Plaintiff is, therefore, entitled to punitive damages in an amount to punish defendants and/or make an example of defendants to curb such conduct in the future. PRAYER FOR RELIEF Exhibit 2 - Page 61 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 70 of 117 Page ID #:545 31 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 WHEREFORE, Plaintiff prays for judgment as follows: 1. For payment of earned wages, waiting time penalties, and other damagesLoss of income incurred and to be incurred according to proof in an amount to be ascertained at trial, currently in excess of $450,000; 2. For payment of all statutory obligations and penalties as required by law;3.For penalties, special and general damages in an amount to be proven at trial;, currently in excess of $900,000 4. Loss of income incurred and to be incurred according to proof; 5. 3. For punitive damages, as allowed by law and pursuant to the causes of action for which punitive damages are permitted, that will sufficiently punish, make an example of, and deter future conduct by Defendants; 6.4. For reasonable attorney’s fees and costs, including expert witness fees, pursuant to Section 12965 of the California Government Code; 7.5. For costs of suit incurred herein; 8.6. For interest provided by law including, but not limited to, Cal. Civil Code § 3291; 9. That Defendants, their successors, agents, representatives, employees and all persons who act in concert with said Defendants be permanently enjoined from committing any acts of discrimination, retaliation, or other similar acts, including the violations alleged in all of the Causes of Action herein and as are prohibited by the Fair Employment and Housing Act, California Government Code §§12900 – 12996; 10.7. For restitution and other equitable relief; and 11.8. Such other relief as the Court deems just and proper. Exhibit 2 - Page 62 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 71 of 117 Page ID #:546 32 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 DATED: March 16,July 14, 2016 ALEXANDER KRAKOW + GLICK LLP By: s/Joshua M.Arnold J. Bernard Alexander, III J. Bernard Alexander, III Joshua M. Arnold Attorneys for Plaintiff MELVIN GLAPION DEMAND FOR JURY TRIAL Plaintiff hereby demands a trial by jury. DATED: March 16,July 14, 2016 ALEXANDER KRAKOW + GLICK LLP By: s/Joshua M.Arnold J. Bernard Alexander, III J. Bernard Alexander, III Joshua M. Arnold Attorneys for Plaintiff MELVIN GLAPION Exhibit 2 - Page 63 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 72 of 117 Page ID #:547 33 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CERTIFICATE OF SERVICE I, Bernard Alexander, an employee of the City of Santa Monica, certify that on March 16,July 14, 2016, caused a true and correct copies of the foregoing be filed with the Clerk of the Court by using the CM/ECF system, which will send a notice of electronic filing to the following counsel who has registered for receipt of documents filed in this matter: PLANITIFF’S NOTICE OF ERRATA AND ERRATA REGARDING PLAINTIFF’S FIRST AMENDED COMPLAINT REMOVING PROVIDENCE EQUITY PARTNERS FROM THE CMPLAINT AND CAPTION PAGE COUNSEL FOR DEFENDANTS: COUNSEL FOR DEFENDANTS: PROVIDENCE EQUITY PARTNERS LLC PROVIDENCE EQUITY PARTNERS LLC Kevin E. Gaut, Esq. Gary D. Friedman, Esq. (Pro Hac Vice Valentie A. Shalamitski, Esq. Submitted Concurrently), Mitchell Silberberg & Knupp LLP Ami G. Zweig, Esq. (Pro Hac Vice 11377 West Olympic Boulevard Submitted Concurrently), Los Angeles, CA 90064-1683 WEIL, GOTSHAL & MANGES, LLP T: (310) 312-2000 767 Fifth Avenue F: (310) 312-3100 New York, NY 10153 E: keg@msk.com T: 1 212 310 8000 vas@msk.com F: 1 212 310 8007 E: gary.friedman@weil.com ami.zweig@weil.com COUNSEL FOR DEFENDANTS: COUNSEL FOR DEFENDANTS: KROLL ASSOCIATES, INC.;KROLL KROLL ASSOCIATES, INC.;KROLL INCORPORATED; CORPORATE INCORPORATED; CORPORATE RISK HOLDINGS, LLC RISK HOLDINGS, LLC Megan M. Lawson Lynne C. Hermle Renee B. Phillips, Esq. Orrick Herrington & Sutcliffe LLP Orrick, Herrington & Sutcliffe LLP 1000 Marsch Road 51 West 52nd Street Menlo Park, California 94025 New York, New York 10019-6142 T: 650 614 7400 T: 212 506 5153 F: 650 614 7401 F: 212 506 5151 E: lchermle@orrick.com E: rphillips@orrick.com megan.lawson@orrick.com March 16,DATED: July 14, 2016 ALEXANDER KRAKOW + GLICK LLP s/J. Bernard Alexander, III J. Bernard Alexander, III Joshua M. Arnold 401 Wilshire Boulevard, Suite 1000 Santa Monica, CA 90401 Attorneys for Plaintiff Exhibit 2 - Page 64 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 73 of 117 Page ID #:548 34 FIRSTSECOND AMENDED COMPLAINT FOR DAMAGES AND DEMAND FOR JURY TRIAL 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 MELVIN GLAPION Exhibit 2 - Page 65 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 74 of 117 Page ID #:549 Document comparison by Workshare Compare on Monday, July 18, 2016 12:37:36 PM Input: Document 1 ID file://C:\Users\S7B\Desktop\765581321_1.DOCX Description 765581321_1 Document 2 ID file://C:\Users\S7B\Desktop\2016.07.14 DE 039 [Glapion] Second Amended Complaint for Damages.docx Description 2016.07.14 DE 039 [Glapion] Second Amended Complaint for Damages Rendering set OHS Strikethrough No Moves No DV Footer Legend: Insertion Deletion Moved from Moved to Style change Format change Moved deletion Inserted cell Deleted cell Moved cell Split/Merged cell Padding cell Statistics: Count Insertions 65 Deletions 166 Moved from 0 Moved to 0 Style change 0 Format changed 0 Total changes 231 Exhibit 2 - Page 66 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 75 of 117 Page ID #:550 EXHIBIT 3 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 76 of 117 Page ID #:551 DECLARATION OF RENEE B. PHILLIPS IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 LYNNE C. HERMLE (STATE BAR NO. 99779) lchermle@orrick.com MEGAN M. LAWSON (STATE BAR NO. 294397) megan.lawson@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 1000 Marsh Road Menlo Park, California 94025 Telephone: 650-614-7400 Facsimile: 650-614-7401 RENEE B. PHILLIPS (pro hac vice) rphillips@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 51 West 52nd Street New York, New York 10019-6142 Telephone: 212-506-5000 Facsimile: 212-506-5151 MARK MERMELSTEIN (STATE BAR NO. 208005) mmermelsein@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 777 South Figueroa Street, Suite 3200 Los Angeles, California 90017 Telephone: 213-629-2020 Facsimile: 213-612-2499 Attorneys for Defendants KROLL ASSOCIATES, INC., KROLL, LLC AND CORPORATE RISK HOLDINGS, LLC UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation; KROLL INCORPORATED, a Delaware Corporation; CORPORATE RISK HOLDINGS, LLC., a Delaware limited liability corporation; and DOES 1 through 100, inclusive, Defendants. Case No. 2:16-CV-00828-FMO-AJW DECLARATION OF RENEE B. PHILLIPS IN SUPPORT OF PARTIAL MOTION TO DISMISS AND MOTION TO STRIKE PLAINTIFF’S FIRST AMENDED COMPLAINT BY DEFENDANTS KROLL ASSOCIATES, INC., KROLL, LLC AND CORPORATE RISK HOLDINGS, LLC Date: May 12, 2016 Time: 10:00 am Courtroom: 22-5th Floor Judge: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 1 of 37 Page ID #:189 Exhibit 3 - Page 67 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 77 of 117 Page ID #:552 1 DECLARATION OF RENEE B. PHILLIPS IN SUPPORT OF MOTION TO DISMISS AND TO STRIKE PLAINTIFF'S COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 I, Renee B. Phillips, declare as follows: 1. I am a member of the New York State bar and a partner in the law firm of Orrick, Herrington & Sutcliffe LLP and have been admitted pro hac vice in the Central District of California for purposes of this action as an attorney of record for Defendants Kroll Associates, Inc., Kroll, LLC and Corporate Risk Holdings, LLC. I make this declaration in support of Defendants’ Partial Motion to Dismiss and Motion to Strike Plaintiff’s First Amended Complaint and am informed and believe that the following is true and correct. 2. A true and correct copy of Plaintiff Melvin Glapion’s complaint to the Occupational Safety & Health Administration (“OSHA”), filed on September 1, 2015, and the Secretary’s Findings with respect to that complaint, dated October 20, 2015, is attached as Exhibit A. 3. A true and correct copy of Plaintiff’s charge of discrimination filed on September 1, 2015 with the California Department of Fair Employment and Housing (“DFEH”), as amended on January 27, 2016 (“Amended Charge”), is attached as Exhibit B. 4. A true and correct copy of Plaintiff’s DFEH Charge dated December 15, 2015 is attached as Exhibit C. I certify under penalty of perjury and pursuant to the laws of the United States (28 U.S.C. § 1746) and the laws of the State of New York that the foregoing is true and correct, and that this declaration was executed by me on April 6, 2016. /s/ Renee B. Phillips Renee B. Phillips Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 2 of 37 Page ID #:190 Exhibit 3 - Page 68 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 78 of 117 Page ID #:553 EXHIBIT A Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 3 of 37 Page ID #:191 Exhibit 3 - Page 69 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 79 of 117 Page ID #:554 Exhibit A - Page 1 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 4 of 37 Page ID #:192 Exhibit 3 - Page 70 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 80 of 117 Page ID #:555 Exhibit A - Page 2 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 5 of 37 Page ID #:193 Exhibit 3 - Page 71 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 81 of 117 Page ID #:556 Exhibit A - Page 3 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 6 of 37 Page ID #:194 Exhibit 3 - Page 72 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 82 of 117 Page ID #:557 Exhibit A - Page 4 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 7 of 37 Page ID #:195 Exhibit 3 - Page 73 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 83 of 117 Page ID #:558 Exhibit A - Page 5 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 8 of 37 Page ID #:196 Exhibit 3 - Page 74 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 84 of 117 Page ID #:559 Exhibit A - Page 6 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 9 of 37 Page ID #:197 Exhibit 3 - Page 75 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/1 /16 Page 85 of 117 Page ID #:560 Exhibit A - Page 7 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 10 of 37 Page ID #:198 Exhibit 3 - Page 76 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 86 of 117 Page ID 561 Exhibit A - Page 8 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 11 of 37 Page ID #:199 Exhibit 3 - Page 77 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 87 of 117 Page ID 562 EXHIBIT B Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 12 of 37 Page ID #:200 Exhibit 3 - Page 78 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 88 of 117 Page ID 563 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov AMENDED 07:50 PM January 27, 2016 September 01, 2015 Joshua Arnold 401 Wilshire Blvd. Suite 1000 Santa Monica California 90401 RE: Notice to Complainant or Complainant’s Attorney DFEH Matter Number: 648479179814 Right to Sue: Glapion / Kroll Associates Inc. Dear Complainant or Complainant’s Attorney: Attached is a copy of your complaint of discrimination filed with the Department of Fair Employment and Housing (DFEH) pursuant to the California Fair Employment and Housing Act, Government Code section 12900 et seq. Also attached is a copy of your Notice of Case Closure and Right to Sue. Pursuant to Government Code section 12962, DFEH will not serve these documents on the employer. You or your attorney must serve the complaint. If you do not have an attorney, you must serve the complaint yourself. Please refer to the attached Notice of Case Closure and Right to Sue for information regarding filing a private lawsuit in the State of California. Be advised that the DFEH does not review or edit the complaint form to ensure that it meets procedural or statutory requirements. Sincerely, Department of Fair Employment and Housing Exhibit B - Page 9 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 13 of 37 Page ID #:201 Exhibit 3 - Page 79 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 89 of 117 Page ID 564 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov AMENDED September 01, 2015 RE: Notice of Filing of Discrimination Complaint DFEH Matter Number: 648479179814 Right to Sue: Glapion / Kroll Associates Inc. To All Respondent(s): Enclosed is a copy of a complaint of discrimination that has been filed with the Department of Fair Employment and Housing (DFEH) in accordance with Government Code section 12960. This constitutes service of the complaint pursuant to Government Code section 12962. The complainant has requested an authorization to file a lawsuit. This case is not being investigated by DFEH and is being closed immediately. A copy of the Notice of Case Closure and Right to Sue is enclosed for your records. Please refer to the attached complaint for a list of all respondent(s) and their contact information. No response to DFEH is requested or required. Sincerely, Department of Fair Employment and Housing Exhibit B - Page 10 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 14 of 37 Page ID #:202 Exhibit 3 - Page 80 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 90 of 117 Page ID 565 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov AMENDED September 01, 2015 Melvin Glapion RE: Notice of Case Closure and Right to Sue DFEH Matter Number: 648479179814 Right to Sue: Glapion / Kroll Associates Inc. Dear Melvin Glapion, This letter informs you that the abovereferenced complaint was filed with the Department of Fair Employment and Housing (DFEH) has been closed effective September 01, 2015 because an immediate Right to Sue notice was requested. DFEH will take no further action on the complaint. This letter is also your Right to Sue notice. According to Government Code section 12965, subdivision (b), a civil action may be brought under the provisions of the Fair Employment and Housing Act against the person, employer, labor organization or employment agency named in the abovereferenced complaint. The civil action must be filed within one year from the date of this letter. To obtain a federal Right to Sue notice, you must visit the U.S. Equal Employment Opportunity Commission (EEOC) to file a complaint within 30 days of receipt of this DFEH Notice of Case Closure or within 300 days of the alleged discriminatory act, whichever is earlier. Sincerely, Department of Fair Employment and Housing Exhibit B - Page 11 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 15 of 37 Page ID #:203 Exhibit 3 - Page 81 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 91 of 117 Page ID 566 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov AMENDED Enclosures cc: Kroll Incorporated Kroll Corp. Corporate Risk Holdings LLC Altegrity Inc. Providence Equity Partners Exhibit B - Page 12 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 16 of 37 Page ID #:204 Exhibit 3 - Page 82 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 92 of 117 Page ID 567 COMPLAINT OF EMPLOYMENT DISCRIMINATION BEFORE THE STATE OF CALIFORNIA DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING Under the California Fair Employment and Housing Act (Gov. Code, § 12900 et seq.) In the Matter of the Complaint of Melvin Glapion, Complainant. vs. Kroll Associates Inc., Respondent. 555 South Flower Street Suite 610 Los Angeles, California 90071 DFEH No. 648479179814 Complainant alleges: 1. Respondent Kroll Associates Inc. is a Private Employer subject to suit under the California Fair Employment and Housing Act (FEHA) (Gov. Code, § 12900 et seq.). Complainant believes respondent is subject to the FEHA. 2. On or around June 16, 2015, complainant alleges that respondent took the following adverse actions against complainant: Discrimination, Harassment, Retaliation Denied a work environment free of discrimination and/or retaliation, Terminated, . Complainant believes respondent committed these actions because of their: Color, Engagement in Protected Activity, Race, Religion, Sexual Orientation, Other Complaints of unlawful activity. 3. Complainant Melvin Glapion resides in the City of Los Angeles, State of California. If complaint includes corespondents please see below. 5 Complaint – DFEH No. 648479179814 Date Filed: September 01, 2015 Date Amended: January 27, 2016 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 13 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 17 of 37 Page ID #:205 Exhibit 3 - Page 83 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 93 of 117 Page ID 568 CoRespondents: Kroll Incorporated 600 Third Avenue 4th Floor New York New York 10016 Kroll Corp. 1475 Greenridge Drive Beverly Hills California 90210 Corporate Risk Holdings LLC 600 Third Avenue New York New York 10016 Altegrity Inc. 2710 Gateway Oaks Drive Suite 150N Sacramento California 95833 Providence Equity Partners Corporation Trust Center 1209 Orange Street Wilmington Delaware 19801 6 Complaint – DFEH No. 648479179814 Date Filed: September 01, 2015 Date Amended: January 27, 2016 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 14 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 18 of 37 Page ID #:206 Exhibit 3 - Page 84 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 94 of 117 Page ID 569 Additional Complaint Details: Mr. Glapion, a gay black man, joined Krolls London office in 2010 as managing director. As a result of his stellar performance in London, in late 2013, he was brought to the Los Angeles office to reform it. Once in Los Angeles, Mr. Glapion attempted to implement uniform standards of performance and conduct for all employees, but quickly found that straight white Jewish employees were given preferential treatment over employees who belonged to other groups. Members of management made discriminatory remarks about Mr. Glapion, including the false allegation that he was hunting straight white males who did not fit his vision of a gays-only office. Members of Kroll management had communications with Mr. Glapions subordinates and former employees which discussed Mr. Glapions race and sexual orientation in a discriminatory manner. In addition, Kroll launched numerous retaliatory investigations against Mr. Glapion which related to his sexual orientation. Mr. Glapion complained about this discrimination, but upper management and HR failed to take action on his complaints. In May 2015, Mr. Glapion complained to HR on three separate occasions. Each time Mr. Glapion complained, HR requested a week delay to review the issues. However, each time, HR failed to investigate or even review Mr. Glapions complaint. In late May 2015, Mr. Glapion informed Dan Watson, Krolls HR Director for North America, that HRs failure to address his complaints was making him question whether the company had a future for him. Watson arranged a conference call with CEO Manny Conti for May 29, 2015, ostensibly to demonstrate how seriously Kroll was taking Mr. Glapions complaints of discrimination. During the call, Mr. Conti stated that he was unaware of the nature of Mr. Glapions discrimination complaints. Days later, on or about June 2, 2015, Mr. Glapion disclosed to Kroll that he had submitted an SEC complaint related to a company named Vipshop misstating its earnings. While Mr. Glapion was not aware of whether Vipshop was a Kroll client, it had come to Mr. Glapions attention that a client of Kroll had invested in Vipshop and other links between Vipshop and Kroll existed. Despite the fact that SEC complaints are legally protected, Kroll immediately launched an investigation after Mr. Glapion informed management of his SEC complaints. On or about June 16, 2015, Kroll had terminated Mr. Glapion for the pretextual reason that he had used his office computer to perform research on Vipshop. Kroll discriminated against, harassed, and ultimately terminated Mr. Glapion for his race, sexual orientation, religion, and in retaliation for his complaints of discrimination and other unlawful conduct. 7 Complaint – DFEH No. 648479179814 Date Filed: September 01, 2015 Date Amended: January 27, 2016 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 15 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 19 of 37 Page ID #:207 Exhibit 3 - Page 85 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 95 of 117 Page ID 570 VERIFICATION I, Melvin Glapion, am the Complainant in the aboveentitled complaint. I have read the foregoing complaint and know the contents thereof. The same is true of my own knowledge, except as to those matters which are therein alleged on information and belief, and as to those matters, I believe it to be true. On September 01, 2015, I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Los Angeles Melvin Glapion 8 Complaint – DFEH No. 648479179814 Date Filed: September 01, 2015 Date Amended: January 27, 2016 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 16 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 20 of 37 Page ID #:208 Exhibit 3 - Page 86 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 96 of 117 Page ID 571 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov 11:49 AM September 03, 2015 September 01, 2015 Joshua Arnold 401 Wilshire Boulevard, Suite 1000 Santa Monica California 90401 RE: Notice to Complainant or Complainant’s Attorney DFEH Matter Number: 615338179814 Right to Sue: Glapion / Kroll Associates, Inc. Dear Complainant or Complainant’s Attorney: Attached is a copy of your complaint of discrimination filed with the Department of Fair Employment and Housing (DFEH) pursuant to the California Fair Employment and Housing Act, Government Code section 12900 et seq. Also attached is a copy of your Notice of Case Closure and Right to Sue. Pursuant to Government Code section 12962, DFEH will not serve these documents on the employer. You or your attorney must serve the complaint. If you do not have an attorney, you must serve the complaint yourself. Please refer to the attached Notice of Case Closure and Right to Sue for information regarding filing a private lawsuit in the State of California. Be advised that the DFEH does not review or edit the complaint form to ensure that it meets procedural or statutory requirements. Sincerely, Department of Fair Employment and Housing Exhibit B - Page 17 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 21 of 37 Page ID #:209 Exhibit 3 - Page 87 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 97 of 117 Page ID 572 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov September 01, 2015 RE: Notice of Filing of Discrimination Complaint DFEH Matter Number: 615338179814 Right to Sue: Glapion / Kroll Associates, Inc. To All Respondent(s): Enclosed is a copy of a complaint of discrimination that has been filed with the Department of Fair Employment and Housing (DFEH) in accordance with Government Code section 12960. This constitutes service of the complaint pursuant to Government Code section 12962. The complainant has requested an authorization to file a lawsuit. This case is not being investigated by DFEH and is being closed immediately. A copy of the Notice of Case Closure and Right to Sue is enclosed for your records. Please refer to the attached complaint for a list of all respondent(s) and their contact information. No response to DFEH is requested or required. Sincerely, Department of Fair Employment and Housing Exhibit B - Page 18 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 22 of 37 Page ID #:210 Exhibit 3 - Page 88 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 98 of 117 Page ID 573 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov September 01, 2015 Melvin Glapion RE: Notice of Case Closure and Right to Sue DFEH Matter Number: 615338179814 Right to Sue: Glapion / Kroll Associates, Inc. Dear Melvin Glapion, This letter informs you that the abovereferenced complaint was filed with the Department of Fair Employment and Housing (DFEH) has been closed effective September 01, 2015 because an immediate Right to Sue notice was requested. DFEH will take no further action on the complaint. This letter is also your Right to Sue notice. According to Government Code section 12965, subdivision (b), a civil action may be brought under the provisions of the Fair Employment and Housing Act against the person, employer, labor organization or employment agency named in the abovereferenced complaint. The civil action must be filed within one year from the date of this letter. To obtain a federal Right to Sue notice, you must visit the U.S. Equal Employment Opportunity Commission (EEOC) to file a complaint within 30 days of receipt of this DFEH Notice of Case Closure or within 300 days of the alleged discriminatory act, whichever is earlier. Sincerely, Department of Fair Employment and Housing Exhibit B - Page 19 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 23 of 37 Page ID #:211 Exhibit 3 - Page 89 Case 2:16-cv-00828-FMO-AJ Document 42-2 Filed 08/11/16 Page 99 of 117 Page ID 574 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov Enclosures cc: Kroll Incorporated Exhibit B - Page 20 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 24 of 37 Page ID #:212 Exhibit 3 - Page 90 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 100 117 Page ID 575 COMPLAINT OF EMPLOYMENT DISCRIMINATION BEFORE THE STATE OF CALIFORNIA DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING Under the California Fair Employment and Housing Act (Gov. Code, § 12900 et seq.) In the Matter of the Complaint of Melvin Glapion, Complainant. vs. Kroll Associates, Inc., Respondent. 555 South Flower Street, Suite 610 Los Angeles, California 90071 DFEH No. 615338179814 Complainant alleges: 1. Respondent Kroll Associates, Inc. is a Private Employer subject to suit under the California Fair Employment and Housing Act (FEHA) (Gov. Code, § 12900 et seq.). Complainant believes respondent is subject to the FEHA. 2. On or around June 16, 2015, complainant alleges that respondent took the following adverse actions against complainant: Discrimination, Harassment, Retaliation Denied a work environment free of discrimination and/or retaliation, Terminated, . Complainant believes respondent committed these actions because of their: Color, Engagement in Protected Activity, Race, Religion, Other Complaints of unlawful activity. 3. Complainant Melvin Glapion resides in the City of Los Angeles, State of California. If complaint includes corespondents please see below. 5 Complaint – DFEH No. 615338179814 Date Filed: September 01, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 21 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 25 of 37 Page ID #:213 Exhibit 3 - Page 91 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 101 117 Page ID 576 CoRespondents: Kroll Incorporated 600 Third Avenue, 4th Floor New York New York 10016 6 Complaint – DFEH No. 615338179814 Date Filed: September 01, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 22 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 26 of 37 Page ID #:214 Exhibit 3 - Page 92 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 102 117 Page ID 577 Additional Complaint Details: Mr. Glapion, a gay black man, joined Krolls London office in 2010 as managing director. As a result of his stellar performance in London, in late 2013, he was brought to the Los Angeles office to reform it. Once in Los Angeles, Mr. Glapion attempted to implement uniform standards of performance and conduct for all employees, but quickly found that straight white Jewish employees were given preferential treatment over employees who belonged to other groups. Members of management made discriminatory remarks about Mr. Glapion, including the false allegation that he was hunting straight white males who did not fit his vision of a gays-only office. Members of Kroll management had communications with Mr. Glapions subordinates and former employees which discussed Mr. Glapions race and sexual orientation in a discriminatory manner. In addition, Kroll launched numerous retaliatory investigations against Mr. Glapion which related to his sexual orientation. Mr. Glapion complained about this discrimination, but upper management and HR failed to take action on his complaints. In May 2015, Mr. Glapion complained to HR on three separate occasions. Each time Mr. Glapion complained, HR requested a week delay to review the issues. However, each time, HR failed to investigate or even review Mr. Glapions complaint. In late May 2015, Mr. Glapion informed Dan Watson, Krolls HR Director for North America, that HRs failure to address his complaints was making him question whether the company had a future for him. Watson arranged a conference call with CEO Manny Conti for May 29, 2015, ostensibly to demonstrate how seriously Kroll was taking Mr. Glapions complaints of discrimination. During the call, Mr. Conti stated that he was unaware of the nature of Mr. Glapions discrimination complaints. Days later, on or about June 2, 2015, Mr. Glapion disclosed to Kroll that he had submitted an SEC complaint related to a company named Vipshop misstating its earnings. While Mr. Glapion was not aware of whether Vipshop was a Kroll client, it had come to Mr. Glapions attention that a client of Kroll had invested in Vipshop and other links between Vipshop and Kroll existed. Despite the fact that SEC complaints are legally protected, Kroll immediately launched an investigation after Mr. Glapion informed management of his SEC complaints. On or about June 16, 2015, Kroll had terminated Mr. Glapion for the pretextual reason that he had used his office computer to perform research on Vipshop. Kroll discriminated against, harassed, and ultimately terminated Mr. Glapion for his race, sexual orientation, religion, and in retaliation for his complaints of discrimination and other unlawful conduct. 7 Complaint – DFEH No. 615338179814 Date Filed: September 01, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 23 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 27 of 37 Page ID #:215 Exhibit 3 - Page 93 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 103 117 Page ID 578 VERIFICATION I, Melvin Glapion, am the Complainant in the aboveentitled complaint. I have read the foregoing complaint and know the contents thereof. The same is true of my own knowledge, except as to those matters which are therein alleged on information and belief, and as to those matters, I believe it to be true. On September 01, 2015, I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Los Angeles Melvin Glapion 8 Complaint – DFEH No. 615338179814 Date Filed: September 01, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit B - Page 24 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 28 of 37 Page ID #:216 Exhibit 3 - Page 94 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 104 117 Page ID 579 EXHIBIT C Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 29 of 37 Page ID #:217 Exhibit 3 - Page 95 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 105 117 Page ID 580 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov 10:42 AM December 15, 2015 December 15, 2015 Joshua Arnold 401 Wilshire Boulevard Suite 1000 Santa Monica California 90401 RE: Notice to Complainant or Complainant’s Attorney DFEH Matter Number: 496417199724 Right to Sue: Glapion / Kroll Associates Inc. Dear Complainant or Complainant’s Attorney: Attached is a copy of your complaint of discrimination filed with the Department of Fair Employment and Housing (DFEH) pursuant to the California Fair Employment and Housing Act, Government Code section 12900 et seq. Also attached is a copy of your Notice of Case Closure and Right to Sue. Pursuant to Government Code section 12962, DFEH will not serve these documents on the employer. You or your attorney must serve the complaint. If you do not have an attorney, you must serve the complaint yourself. Please refer to the attached Notice of Case Closure and Right to Sue for information regarding filing a private lawsuit in the State of California. Be advised that the DFEH does not review or edit the complaint form to ensure that it meets procedural or statutory requirements. Sincerely, Department of Fair Employment and Housing Exhibit C - Page 25 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 30 of 37 Page ID #:218 Exhibit 3 - Page 96 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 106 117 Page ID 581 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov December 15, 2015 RE: Notice of Filing of Discrimination Complaint DFEH Matter Number: 496417199724 Right to Sue: Glapion / Kroll Associates Inc. To All Respondent(s): Enclosed is a copy of a complaint of discrimination that has been filed with the Department of Fair Employment and Housing (DFEH) in accordance with Government Code section 12960. This constitutes service of the complaint pursuant to Government Code section 12962. The complainant has requested an authorization to file a lawsuit. This case is not being investigated by DFEH and is being closed immediately. A copy of the Notice of Case Closure and Right to Sue is enclosed for your records. Please refer to the attached complaint for a list of all respondent(s) and their contact information. No response to DFEH is requested or required. Sincerely, Department of Fair Employment and Housing Exhibit C - Page 26 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 31 of 37 Page ID #:219 Exhibit 3 - Page 97 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 107 117 Page ID 582 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov December 15, 2015 Melvin Glapion RE: Notice of Case Closure and Right to Sue DFEH Matter Number: 496417199724 Right to Sue: Glapion / Kroll Associates Inc. Dear Melvin Glapion, This letter informs you that the abovereferenced complaint was filed with the Department of Fair Employment and Housing (DFEH) has been closed effective December 15, 2015 because an immediate Right to Sue notice was requested. DFEH will take no further action on the complaint. This letter is also your Right to Sue notice. According to Government Code section 12965, subdivision (b), a civil action may be brought under the provisions of the Fair Employment and Housing Act against the person, employer, labor organization or employment agency named in the abovereferenced complaint. The civil action must be filed within one year from the date of this letter. To obtain a federal Right to Sue notice, you must visit the U.S. Equal Employment Opportunity Commission (EEOC) to file a complaint within 30 days of receipt of this DFEH Notice of Case Closure or within 300 days of the alleged discriminatory act, whichever is earlier. Sincerely, Department of Fair Employment and Housing Exhibit C - Page 27 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 32 of 37 Page ID #:220 Exhibit 3 - Page 98 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 108 117 Page ID 583 STATE OF CALIFORNIA | Business, Consumer Services and Housing Agency GOVERNOR EDMUND G. BROWN JR. DEPARTMENT OF FAIR EMPLOYMENT & HOUSING DIRECTOR KEVIN KISH 2218 Kausen Drive, Suite 100 I Elk Grove I CA I 95758 800-884-1684 I TDD 800-700-2320 www.dfeh.ca.gov I email: contact.center@dfeh.ca.gov Enclosures cc: Kroll Incorporated Kroll Corp. Corporate Risk Holdings LLC Altegrity Inc. Providence Equity Partners LLC Exhibit C - Page 28 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 33 of 37 Page ID #:221 Exhibit 3 - Page 99 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 109 117 Page ID 584 COMPLAINT OF EMPLOYMENT DISCRIMINATION BEFORE THE STATE OF CALIFORNIA DEPARTMENT OF FAIR EMPLOYMENT AND HOUSING Under the California Fair Employment and Housing Act (Gov. Code, § 12900 et seq.) In the Matter of the Complaint of Melvin Glapion, Complainant. vs. Kroll Associates Inc., Respondent. 555 South Flower Street Suite 610 Los Angeles, California 90071 DFEH No. 496417199724 Complainant alleges: 1. Respondent Kroll Associates Inc. is a Private Employer subject to suit under the California Fair Employment and Housing Act (FEHA) (Gov. Code, § 12900 et seq.). Complainant believes respondent is subject to the FEHA. 2. On or around June 16, 2015, complainant alleges that respondent took the following adverse actions against complainant: Discrimination, Harassment, Retaliation Denied a work environment free of discrimination and/or retaliation, Terminated, . Complainant believes respondent committed these actions because of their: Color, Engagement in Protected Activity, Race, Religion, Other Complaints of unlawful activity. 3. Complainant Melvin Glapion resides in the City of Los Angeles, State of California. If complaint includes corespondents please see below. 5 Complaint – DFEH No. 496417199724 Date Filed: December 15, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit C - Page 29 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 34 of 37 Page ID #:222 Exhibit 3 - Page 100 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 110 117 Page ID 585 CoRespondents: Kroll Incorporated Kroll Corp. 1475 Greenridge Drive Beverly Hills California 90210 Corporate Risk Holdings LLC 600 Third Avenue New York New York 10016 Altegrity Inc. 2710 Gateway Oaks Drive Suite 150N Sacramento California 95833 Providence Equity Partners LLC Corporation Trust Center 1209 Orange Street Wilmington Delaware 19801 6 Complaint – DFEH No. 496417199724 Date Filed: December 15, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit C - Page 30 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 35 of 37 Page ID #:223 Exhibit 3 - Page 101 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 111 117 Page ID 586 Additional Complaint Details: Mr. Glapion, a gay black man, joined Krolls London office in 2010 as managing director. As a result of his stellar performance in London, in late 2013, he was brought to the Los Angeles office to reform it. Once in Los Angeles, Mr. Glapion attempted to implement uniform standards of performance and conduct for all employees, but quickly found that straight white Jewish employees were given preferential treatment over employees who belonged to other groups. Members of management made discriminatory remarks about Mr. Glapion, including the false allegation that he was hunting straight white males who did not fit his vision of a gays-only office. Members of Kroll management had communications with Mr. Glapions subordinates and former employees which discussed Mr. Glapions race and sexual orientation in a discriminatory manner. In addition, Kroll launched numerous retaliatory investigations against Mr. Glapion which related to his sexual orientation. Mr. Glapion complained about this discrimination, but upper management and HR failed to take action on his complaints. In May 2015, Mr. Glapion complained to HR on three separate occasions. Each time Mr. Glapion complained, HR requested a week delay to review the issues. However, each time, HR failed to investigate or even review Mr. Glapions complaint. In late May 2015, Mr. Glapion informed Dan Watson, Krolls HR Director for North America, that HRs failure to address his complaints was making him question whether the company had a future for him. Watson arranged a conference call with CEO Manny Conti for May 29, 2015, ostensibly to demonstrate how seriously Kroll was taking Mr. Glapions complaints of discrimination. During the call, Mr. Conti stated that he was unaware of the nature of Mr. Glapions discrimination complaints. Days later, on or about June 2, 2015, Mr. Glapion disclosed to Kroll that he had submitted an SEC complaint related to a company named Vipshop misstating its earnings. While Mr. Glapion was not aware of whether Vipshop was a Kroll client, it had come to Mr. Glapions attention that a client of Kroll had invested in Vipshop and other links between Vipshop and Kroll existed. Despite the fact that SEC complaints are legally protected, Kroll immediately launched an investigation after Mr. Glapion informed management of his SEC complaints. On or about June 16, 2015, Kroll had terminated Mr. Glapion for the pretextual reason that he had used his office computer to perform research on Vipshop. Kroll discriminated against, harassed, and ultimately terminated Mr. Glapion for his race, sexual orientation, religion, and in retaliation for his complaints of discrimination and other unlawful conduct. 7 Complaint – DFEH No. 496417199724 Date Filed: December 15, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit C - Page 31 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 36 of 37 Page ID #:224 Exhibit 3 - Page 102 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 112 117 Page ID 587 VERIFICATION I, Joshua Arnold, am the Attorney for Complainant in the aboveentitled complaint. I have read the foregoing complaint and know the contents thereof. The same is true of my own knowledge, except as to those matters which are therein alleged on information and belief, and as to those matters, I believe it to be true. On December 15, 2015, I declare under penalty of perjury under the laws of the State of California that the foregoing is true and correct. Santa Monica, California Joshua Arnold 8 Complaint – DFEH No. 496417199724 Date Filed: December 15, 2015 DFEH 9021 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 Exhibit C - Page 32 Case 2:16-cv-00828-FMO-AJW Document 26-4 Filed 04/06/16 Page 37 of 37 Page ID #:225 Exhibit 3 - Page 103 Case 2:16-cv-0 828-FMO-AJW Document 4 -2 Filed 08/11/16 Page 113 117 Page ID 588 EXHIBIT 4 Case 2:16-cv-00828-FMO-AJW Document 42-2 Filed 08/11/16 Page 114 of 117 Page ID #:589 DECLARATION OF KENN LICHTENWALTER IN SUPPORT OF MOTION AND MOTION TO DISMISS AND MOTION TO STRIKE [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 LYNNE C. HERMLE (STATE BAR NO. 99779) lchermle@orrick.com MEGAN M. LAWSON (STATE BAR NO. 294397) megan.lawson@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 1000 Marsh Road Menlo Park, California 94025 Telephone: 650-614-7400 Facsimile: 650-614-7401 RENEE B. PHILLIPS (pro hac vice) rphillips@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 51 West 52nd Street New York, New York 10019-6142 Telephone: 212-506-5000 Facsimile: 212-506-5151 MARK MERMELSTEIN (STATE BAR NO. 208005) mmermelsein@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 777 South Figueroa Street, Suite 3200 Los Angeles, California 90017 Telephone: 213-629-2020 Facsimile: 213-612-2499 Attorneys for Defendants KROLL ASSOCIATES, INC., KROLL, LLC AND CORPORATE RISK HOLDINGS, LLC UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation; KROLL INCORPORATED, a Delaware Corporation; CORPORATE RISK HOLDINGS, LLC., a Delaware limited liability corporation; and DOES 1 through 100, inclusive, Defendants. Case No. 2:16-CV-00828-FMO-AJW DECLARATION OF KENN LICHTENWALTER IN SUPPORT OF PARTIAL MOTION TO DISMISS AND MOTION TO STRIKE PLAINTIFF’S FIRST AMENDED COMPLAINT BY DEFENDANTS KROLL ASSOCIATES, INC., KROLL, LLC AND CORPORATE RISK HOLDINGS, LLC Date: May 12, 2016 Time: 10:00 am Courtroom: 22-5th Floor Judge: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 26-3 Filed 04/06/16 Page 1 of 3 Page ID #:186 Exhibit 4 - Page 104 Case 2:16-cv-00828-F O-AJ Docu ent 42-2 Filed 08/11/16 Page 115 of 117 Page ID #:590 Case 2:16-cv-00828-FMO-AJW Document 26-3 Filed 04/06/16 Page 2 of 3 Page ID #:187 Exhibit 4 - Page 105 Case 2:16-cv-00828-F O-AJ Docu ent 42-2 Filed 08/11/16 Page 116 of 117 Page ID #:591 Case 2:16-cv-00828-FMO-AJW Document 26-3 Filed 04/06/16 Page 3 of 3 Page ID #:188 Exhibit 4 - Page 106 Case 2:16-cv-00828-F O-AJ Docu ent 42-2 Filed 08/11/16 Page 117 of 117 Page ID #:592 [PROPOSED] ORDER GRANTING PARTIAL MOTION TO DISMISS AND STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 OHSUSA:765660435.1 LYNNE C. HERMLE (STATE BAR NO. 99779) lchermle@orrick.com MEGAN M. LAWSON (STATE BAR NO. 294397) megan.lawson@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 1000 Marsh Road Menlo Park, California 94025 Telephone: 650-614-7400 Facsimile: 650-614-7401 RENEE B. PHILLIPS (pro hac vice) rphillips@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 51 West 52nd Street New York, New York 10019-6142 Telephone: 212-506-5000 Facsimile: 212-506-5151 MARK MERMELSTEIN (STATE BAR NO. 208005) mmermelsein@orrick.com ORRICK, HERRINGTON & SUTCLIFFE LLP 777 South Figueroa Street, Suite 3200 Los Angeles, California 90017 Telephone: 213-629-2020 Facsimile: 213-612-2499 Attorneys for Defendants KROLL ASSOCIATES, INC. UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA, WESTERN DIVISION MELVIN GLAPION, an individual, Plaintiff, vs. KROLL ASSOCIATES INC., a Delaware Corporation, Defendant. Case No. 2:16-CV-00828-FMO-AJW [PROPOSED] ORDER GRANTING PARTIAL MOTION TO DISMISS AND TO STRIKE PLAINTIFF’S SECOND AMENDED COMPLAINT BY DEFENDANT KROLL ASSOCIATES, INC. Date: September 8, 2016 Time: 10:00 am Courtroom: 22-5th Floor Judge: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 42-3 Filed 08/11/16 Page 1 of 2 Page ID #:593 1 [PROPOSED] ORDER GRANTING PARTIAL MOTION TO DISMISS AND STRIKE PLAINTIFF'S SECOND AMENDED COMPLAINT [2:16-CV-00828-FMO-AJW] 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 OHSUSA:765660435.1 The Partial Motion to Dismiss and to Strike Plaintiff’s Second Amended Complaint [Dkt Entry 39] of Defendant Kroll Associates, Inc., came for hearing on Thursday, September 8, 2016 in Courtroom 22 of the United States District Court for the Central District of California before the Honorable Fernando M. Olguin. All parties were represented by counsel. Having considered all pleadings and papers filed by the parties in connection with this motion, any arguments of counsel, and all other matter properly before the Court, the Court rules as follows: IT IS HEREBY ORDERED THAT Defendant’s Partial Motion to Dismiss and to Strike Plaintiff’s Second Amended Complaint is GRANTED in its entirety as follows: 1. Counts 1 through 5 and 9 are dismissed for failure to allege facts sufficient to state a plausible claim for relief as required by the minimum pleading standards of Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009); 2. Counts 7 and 8 are dismissed for lack of subject matter jurisdiction and failure to allege facts sufficient to state a plausible claim for relief as required by the minimum pleading standards of Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) and Ashcroft v. Iqbal, 556 U.S. 662 (2009); and 3. The allegation in Count 10 that “Plaintiff’s opposition to and refusal to participate in activities which would result in a violation or noncompliance with federal, state, or local regulations, including but not limited to Defendants’ [sic] failure to follow laws which allow complaints to the SEC” is stricken from the Second Amended Complaint; IT IS SO ORDERED. Dated: Hon. Fernando M. Olguin Case 2:16-cv-00828-FMO-AJW Document 42-3 Filed 08/11/16 Page 2 of 2 Page ID #:594