2012-00117826-CU-WT

Theresa Dunagan vs. Heatherstone Capital, Inc.

Nature of Proceeding: Motion for Summary Adjudication

Filed By: Yang, Stephanie T.

Defendants Heatherstone Capital, Inc., Park Place Asset Management, The Park
Place Group and Barcelona Investors’ Motion for Summary Adjudication as to Portions
of Plaintiff Theresa Dunagan’s First Amended Complaint (“FAC”) is GRANTED in part
and DENIED in part as set forth below.

Defendants’ Request for Judicial Notice is GRANTED.

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Plaintiff’s FAC sets forth seven causes of action: the 1 for disability discrimination, the
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2 for failure to reasonably accommodate disability, the 3 for retaliation, the 4 for
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violation of CFRA, the 5 for termination in violation of public policy; the 6 for failure
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to engage in the interactive process and the 7 for intentional infliction of emotional
distress.

Both moving party defendants and opposing party plaintiff have referred to their
material facts and additional material facts as “UMF”. For clarity, the Court cites to
defendants’ material facts as “DMF” and to the plaintiff’s additional material facts as
“AMF” below.

Plaintiff was an on-site full-time property manager for Park Place Asset Management
at the Barcelona Apartments in Carmichael, commencing in June 2007. (DMF 2)

In Feb. 2011, plaintiff was diagnosed with breast cancer, and notified her Regional
Manager of her medical condition and need for leave to undergo surgery. (DMF 9)

Moving parties identify five issues which they wish summarily adjudicated, each of
which is addressed separately below.

Issue 1: Summary adjudication of the 2nd cause of Action for Failure to Accommodate
is DENIED.

The Fair Employment and Housing Act (FEHA) requires employers to provide
reasonable accommodations to disabled employees. (Govt. Code §12940(m) (Scotch
v. Art Institute of California (2009) 173 Cal.App.4th 986, 1009-1010.)

Moving parties assert that the 2nd cause of action for failure to accommodate against
defendants must be dismissed, because defendants, in fact, reasonably
accommodated plaintiff by providing her with (a) a leave of absence and (b) a job
transfer opportunity which satisfied her work restrictions.

Plaintiff must show that: (1) she suffers from a disability covered by the FEHA; (2) she
is a qualified individual who can perform essential functions of her position with the
requested accommodations; and (3) Defendants failed to reasonably accommodate
her disability. (Gov. Code, sec. 12940 (m); Fisher v. Superior Court (1986) 177
Cal.App.3d 779, 783.)

FEHA requires employers to make reasonable accommodations for the known
disabilities of employees to enable them to perform a position’s essential functions,
unless doing so would produce undue hardship to the employer’s
operations. (Id.) Part-time assignments, modified work schedules, or reassignment to a
vacant position are specifically enumerated examples of reasonable accommodation
under Gov. Code, sec. 12940 (m).

The employer need not select the “best” accommodation or the accommodation the
employee seeks; rather, “the employer has the ultimate discretion to choose between
accommodations, and may choose the less expensive accommodation or the one
which is easier for it to provide.” (Hanson v. Lucky Stores, Inc. (1999) 74 Cal.App.4th
215, 228.)

Here, plaintiff was on medical leave commencing March 24, 2011. (DMF 10)

Chuck Potter, the Vice President and Controller of her employer, discussed plaintiff’s
work restrictions with her. He requested further clarification from her physician. (DMF
12-15) On May 9, 2011 she provided a doctor’s note permitting her to return to work
part-time on moderate duty for a period of six months. A completed medical
questionnaire was faxed by her physician to her employer on June 1, 2011, releasing
her to return to work part-time while she underwent chemotherapy for six months. The
doctor made clear that plaintiff could not return to work full time during treatment.
(DMF 16)

Defendants assert that they offered plaintiff a reasonable accommodation, by offering
her a part time position at a different apartment complex. (DMF 21)

In opposition, Plaintiff contends that the offer was not reasonable; as it would require
her to move from Carmichael to Antioch, 75 miles, lose her health benefits, move away
from her treating oncologist, and move from a two bedroom into a one bedroom
apartment with her 11 year old son, her daughter and her granddaughter. (Plaintiff’s
AMF 27-31.) There was no guarantee that at the end of the six months of part time
work, plaintiff would be returned to full time employment.

Plaintiff further contends that as the Barcelona apartments had previously been
managed by one full time and one part time employee, it would have been possible for
defendants to accommodate her by permitting her to continue to work at the Barcelona
apartments. Plaintiff requested that have a half day off every third Thursday, and a full
day off the third Friday of each month, to accommodate her chemotherapy. (DMF 26.)

Plaintiff was terminated from her employment on June 15, 2011. (AMF 32.)

Although the moving party has met its initial burden, the Court finds that plaintiff has
identified sufficient disputed material facts to require that the finder of fact determine
this issue. “[F]rom commencement to conclusion, the party moving for summary

judgment bears the burden of persuasion that there is no triable issue of material fact
and that he is entitled to judgment as a matter of law…There is a triable issue of
material fact if, and only if, the evidence would allow a reasonable trier of fact to find
the underlying fact in favor of the party opposing the motion in accordance with the
applicable standard of proof.” (Aguilar v. Atlantic Richfield Co . (2001) 25 Cal.4th 826,
850.)

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Issue 2: Summary adjudication of the 4 cause of Action for Failure to Reinstate after
CFRA Leave is GRANTED.

Plaintiff has sued for violation of the California Family Rights Act (“CFRA/FMLA”)
(Govt. Code sec. 12945.2) which prohibits retaliation against employees needing up to
12 weeks of family care leave per year.

A plaintiff can establish a prima facie case of retaliation in violation of the CFRA by
showing the following: (1) the defendant was a covered employer; (2) the plaintiff was
eligible for CFRA leave; (3) the plaintiff exercised his or her right to take a qualifying
leave; and (4) the plaintiff suffered an adverse employment action because he or she
exercised the right to take CFRA leave. Rogers v. County of Los Angeles (2011) 198
Cal. App. 4th 480, 491

Moving parties assert that the 4th cause of action for failure to reinstate after CFRA
leave against defendants must be dismissed, because defendants were not covered
entities under the CFRA in that none employed fifty or more employees within seventy-
five miles of Plaintiffs last work site.

Neither PPAM nor Barcelona is a covered entity under the statute. The CFRA protects
employees needing medical leave and prohibits an employer from discharging or
discriminating against an employee who requests family or medical leave. (Gibbs v.
American Airlines, Inc. (1999) 74 Cal.App.4th 1, 6; Gov. Code, § 12945.2(a).)
However, the CFRA applies only to employers with fifty or more employees within
seventy-five miles of the employee’s last worksite for each working day during each of
the twenty or more calendar workweeks in the current or preceding calendar year.
(Gov. Code, § 12945.2.)

Here, Barcelona had a total of four employees, and two or three temporary employees
at the relevant time. Assuming PPAM was a joint employer with Barcelona; the closest
property was 75.3 miles away and employed nine employees in June 2011.

As the combined properties within 75 miles did not employ 50 employees, the CFRA is
inapplicable.

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Plaintiff does not oppose this motion as to the 4 cause of action. (Oppo. 15:1-4.)

Issue 3: Summary adjudication of the 6th cause of action for failure to engage in the
interactive process is DENIED.

Moving parties assert that the 6th cause of action for failure to engage in the
interactive process against defendants must be dismissed, because Defendants
engaged in the interactive process by offering Plaintiff a job transfer, which she
refused.

An employer must engage in a timely, good faith interactive process to determine
effective reasonable accommodations with an individual who has a known disability or
medical condition and requests accommodation, although liability exists only if
reasonable accommodation is in fact possible. Gov. Code, sec. 12940(n).

In the interactive process, the primary burden lies with the employee to assist the
employer in determining what the appropriate accommodation may be. (See King v.
United Parcel Service (2007) 152 Cal.App.4th 426, 442.)

It is the employee’s responsibility to understand his or her own physical or mental
condition well enough to present to the employer at the earliest opportunity with a
concise list of restrictions which must be met to accommodate the employee. (Jensen
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v. Wells Fargo (2000) 85 Cal.App.4 245, 266.)

On June 1, 2011, Defendants’ received the questionnaire from plaintiff’s physician. On
June 6, 2011, defendants offered plaintiff a part-time position in Antioch. (DMF 20-21.)
On June 9, 2011, Potter discussed possible accommodations with the plaintiff as part
of the interactive process, explained to plaintiff why a part time position was not
available at the Barcelona apartments, and offered her a part time position elsewhere
in compliance with her doctor’s orders. After hearing plaintiff’s counter request for
accommodation, Potter explained to plaintiff why that was not possible, given the
doctor’s restrictions. (DMF 28.)

In opposition, plaintiff asserts that after receiving her doctor’s note, defendants made
no effort to consider whether she could carry out her job responsibilities while working
part time at Barcelona. (AMF 11) Defendants did not contact her physician to
determine how many hours plaintiff would be capable of working under the part time
restriction. (AMF 12) Neither Potter nor Frost spoke to plaintiff’s supervisor Dalton to
request any information regarding whether plaintiff could be accommodated part time
at Barcelona, although Dalton was the person most familiar with plaintiff’s job
responsibilities. (AMF 13.)

The Court finds that disputed issues of material fact remain as to whether plaintiff’s
employer engaged in a timely, good faith interactive process to determine effective
reasonable accommodations with an individual who has a known disability

Defendants further assert that there is no liability for failing to engage in an interactive
process when the employee was, in fact, offered a reasonable accommodation. (
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Wilson v. County of Orange (2009) 169 Cal.App.4 1185, Nadof-Rahrov v. The
Neiman Marcus Group, Inc. (2008) 166 CaI.App.4th 952, 971. However, as the Court
did not grant summary adjudication of the 2nd cause of action, the Court cannot
conclude that the offer to accommodate bars plaintiff’s cause of action for failure to
engage in the interactive process.

Issue 4: Summary adjudication of the 7th cause of action for intentional infliction of
emotional distress is GRANTED.

Moving parties assert that the 7th Cause of Action for intentional infliction of emotional
distress against defendants must be dismissed, because this claim is premised entirely
on plaintiff’s belief that she was not offered a reasonable accommodation, which is not
conduct sufficiently extreme or outrageous as a matter of law.

In the employment context, the elements of a cause of action for intentional infliction of
emotional distress are (1) the defendant’s extreme and outrageous conduct, (2) the
intention to cause, or reckless disregard of the probability of causing, emotional
distress, (3) the plaintiff’s severe emotional suffering, and (4) actual and proximate
causation of the emotional distress by the defendant’s conduct. (Heller v. Pillsbury
Madison & Sutro (1996) 50 Cal.App.4th 1367, 1388; Potter v. Firestone Tire & Rubber
Co. (1993) 6 Cal. 4th 965, 1001.)

To be “outrageous,” conduct “must be so extreme as to exceed all bounds of that
usually tolerated in a civilized community.” It is for the court to determine, in the first
instance, whether the defendant’s conduct may reasonably be regarded as so extreme
and outrageous as to permit recovery. Outrageousness is an objective standard
applied to actual conduct. Fowler v. Varian Assocs. (1987) 196 Cal. App. 3d 34, 44;
see also Ankeny v. Lockheed Missiles & Space, Co. (1979) 88 Cal. App. 3d 531).

Plaintiff’s only reason for claiming emotional distress is that defendants’ proposed
accommodation was not “reasonable,” i.e. not her preferred accommodation. (DMF 24,
25.) However, this is not sufficient to constitute “extreme and outrageous conduct”.

Issue 5: Summary adjudication of plaintiff’s prayer for “front pay damages” is DENIED.

Moving parties assert that Plaintiff’s prayer for front pay damages must be dismissed,
because Plaintiff lied on her employment application, an act in violation of Company
policy which would have led to her termination.

While C.C.P., sec. 437c (f) (1) permits a party to move for summary adjudication as to
one or more causes of action, one or more affirmative defenses, one or more claims
for damages or one or more issues of duty; it is clear from that statute, that
adjudication of the “claim for damages”, as specified in Section 3294 of the Civil Code”
applies to punitive damages only.

While C.C.P., sec. 437c (f) (1) permits a party to move for summary adjudication as to
one or more causes of action, one or more affirmative defenses, one or more claims
for damages or one or more issues of duty; it is clear from that statute, that
adjudication of the “claim for damages”, as specified in Section 3294 of the Civil Code”
applies to punitive damages only.

Although Subsection (s) permits a party to move for summary adjudication of a legal
issue or a claim for damages other than punitive damages that does not completely
dispose of a cause of action, an affirmative defense, or an issue of duty, it requires the
prior submission to the court a joint stipulation clearly setting forth the issue or issues
to be adjudicated, with a declaration from each stipulating party demonstrating that a
ruling on the motion will further the interests of judicial economy by reducing the time
to be consumed in trial or significantly increasing the probability of settlement and an
order of the Court thereon before filing the motion for summary adjudication. C.C.P.,
sec. 437c(s)(1-3). The Court files reflect no such stipulation and order in this action.

In this case where the motion addresses only “front pay” compensation for lost wages
(DMF 37), and no cause of action prays for “front pay damages” as the only damages
alleged, it is not an essential element of any of the causes of action, in the absence of
a stipulation and showing that the motion would further the issues of judicial economy,
it is not an appropriate issue for summary adjudication by the Court.