Case Name: Dan Gur v. Mellanox Technologies, Inc., et al.

Case No.: 1-15-CV-282869

Defendant Mellanox Technologies, Inc.’s Motion for Summary Judgment, or in the Alternative, Summary Adjudication

Factual and Procedural Background

In or about 2010, defendant Mellanox Technologies, Inc. (“Mellanox”) hired plaintiff Dan Gur (“Gur”) as a Business Development and Sales Executive. (First Amended Complaint (“FAC”), ¶10.) Over his years of employment with defendant Mellanox, plaintiff Gur was responsible for developing a close sales relationship with Apple. (FAC, ¶12.) The Apple account, developed and maintained by plaintiff Gur, was Mellanox’s largest account. (FAC, ¶13.)

Plaintiff received commissions for his sales pursuant to defendant Mellanox’s Commissions Compensation Plan. (FAC, ¶14.) Pursuant to the Commissions Compensation Plan, plaintiff Gur was paid commissions for sales in the quarter following the one in which the sale was made. (FAC, ¶15.)

In or about January 2014, plaintiff Gur began noticing that he was not receiving all of his commissions earned in the previous quarter and immediately complained to his supervisor, Chris Shea (“Shea”). (FAC, ¶¶16 – 17.) Shea indicated he would “take care of it,” but failed to correct or investigate the missing commissions. (FAC, ¶18.)

In or about November 2014, defendant Mellanox hired defendant Barbara Carlson (“Carlson”) in a position superior to plaintiff Gur. (FAC, ¶20.) Soon after Carlson’s hire, plaintiff Gur’s unpaid commissions significantly increased. (FAC, ¶21.) On information and belief, plaintiff Gur alleges Shea and Carlson took commissions from plaintiff Gur’s Apple account. (FAC, ¶¶22 – 23.) Plaintiff Gur complained to both Shea and Carlson who, in retaliation, placed plaintiff Gur on a performance improvement plan (“PIP”). (FAC, ¶¶23 – 24.) Prior to the PIP, plaintiff Gur had never received a warning, negative performance review, or negative feedback and, instead, received positive performance reviews from executive management. (FAC, ¶25.) Under the terms of the PIP, plaintiff Gur was told he would be fired unless he met his quarter one quota. (FAC, ¶26.)

In or about January 2015, plaintiff Gur met with Carlson to discuss the PIP. (FAC, ¶28.) Plaintiff Gur told Carlson he had spoken with Mellanox’s CEO, Eyal Waldman (“Waldman”) and asked Carlson to speak with Waldman. (FAC, ¶¶29 – 30.) Carlson became upset and shouted to plaintiff Gur that he was a “fucking disrespectful, lazy, old man, home-phone sales, SOB.” (FAC, ¶30.) Plaintiff Gur went directly to complain about the situation to Mellanox Human Resources. (FAC, ¶32.) Shortly after, plaintiff Gur sent a detailed written complaint to Mellanox Human Resources. (FAC, ¶33.)

In late January 2015, plaintiff Gur closed a major deal with Apple wherein Mellanox would design custom silicon photonic devices for Apple’s consumer products. (FAC, ¶37.) The deal created hundreds of millions of dollars in revenue for Mellanox. (FAC, ¶37.) The deal brokered by plaintiff Gur was the largest deal ever for Mellanox. (FAC, ¶38.) In making the deal, plaintiff Gur met not only his quarter one quota but tripled all of his quotas for the next two years. (FAC, ¶38.) Plaintiff did not receive any commissions for the January 2015 Apple deal. (FAC, ¶39.)

On or about February 1, 2015, Carlson summoned plaintiff Gur to her office and threatened termination. (FAC, ¶40.) Shea joined the meeting shortly thereafter and verbally attacked plaintiff Gur. (FAC, ¶40.) Following the meeting, plaintiff Gur again complained to Mellanox Human Resources about the threats. (FAC, ¶40.) Mellanox failed to investigate plaintiff Gur’s complaints. (FAC, ¶41.)

On or about February 3, 2015, Carlson and Shea terminated plaintiff Gur’s employment in retaliation for complaining. (FAC, ¶42.) Since February 3, 2015, plaintiff Gur has not received any of his earned commissions, earned stocks, and unpaid commissions/ stocks. (FAC, ¶43.)

On July 9, 2015, plaintiff Gur filed a complaint against defendant Mellanox. On August 12, 2015, defendant Mellanox filed its answer to plaintiff Gur’s complaint. On March 22, 2016, the court granted plaintiff Gur leave to amend his complaint. On April 4, 2016, plaintiff Gur filed the operative FAC adding defendant Carlson and asserting causes of action for:

(1) Breach of Contract
(2) Breach of Employment Contract – Failure to Pay Commissions
(3) Age Discrimination
(4) Retaliation
(5) Wrongful Termination in Violation of Public Policy
(6) Violation of Labor Code 201
(7) Failure to Properly Investigate
(8) Slander Per Se

On May 3, 2016, defendant Mellanox filed a demurrer to the eighth cause of action. On June 16, 2016, the court (Hon. Stoelker) sustained, with leave to amend, defendant Mellanox’s demurrer to the eighth cause of action. On July 13, 2016, defendant Mellanox filed its answer to plaintiff Gur’s FAC. On November 10, 2016, the court clerk entered dismissal of defendant Carlson at plaintiff Gur’s request.

On August 17, 2017, defendant Mellanox filed the motion now before the court, a motion for summary judgment/ adjudication of plaintiff Gur’s FAC.

On November 30, 2017, plaintiff Gur filed opposition to defendant Mellanox’s motion for summary judgment.

I. Defendant Mellanox’s motion for summary judgment is DENIED.

A. Defendant Mellanox’s motion for summary adjudication of the first cause of action [breach of contract] is GRANTED.

Plaintiff does not oppose summary adjudication of the first cause of action. Accordingly, defendant Mellanox’s alternative motion for summary adjudication of the first cause of action in plaintiff Gur’s FAC for breach of contract is GRANTED.

B. Defendant Mellanox’s motion for summary adjudication of the second cause of action [breach of contract – failure to pay commissions] is DENIED.

In the second cause of action, plaintiff Gur alleges defendant Mellanox failed to pay for commissions that plaintiff had earned in violation of a Commissions Compensation Plan. (FAC, ¶¶52 and 58.) Plaintiff Gur further alleges defendant Mellanox violated Labor Code section 2751 “in that Mellanox did not give plaintiff a signed copy of the contract or changes thereto and did not ask for or obtain from plaintiff a signed receipt therefor.”

Labor Code section 2751 states, in relevant part:

(a) Whenever an employer enters into a contract of employment with an employee for services to be rendered within this state and the contemplated method of payment of the employee involves commissions, the contract shall be in writing and shall set forth the method by which the commissions shall be computed and paid.
(b) The employer shall give a signed copy of the contract to every employee who is a party thereto and shall obtain a signed receipt for the contract from each employee. In the case of a contract that expires and where the parties nevertheless continue to work under the terms of the expired contract, the contract terms are presumed to remain in full force and effect until the contract is superseded or employment is terminated by either party.

“A statement of a cause of action for breach of contract requires a pleading of (1) the contract, (2) plaintiff’s performance or excuse for non-performance, (3) defendant’s breach, and (4) damage to plaintiff therefrom.” (Acoustics, Inc. v. Trepte Constr. Co. (1971) 14 Cal.App.3d 887, 913; see also CACI, No. 303.)

In moving for summary adjudication of the second cause of action, defendant Mellanox apparently argues that it did not breach or that plaintiff lacks evidence of breach. The only relevant fact proffered by defendant Mellanox is the fact that Christina Quinto [Director of Sales Administration] responded to Plaintiff’s inquiries about missing commissions and confirmed that Plaintiff was the assigned individual for the Apple account in Mellanox’s database/accounting system and managers like Shea and Carlson do not have access to the system to change the Apple assignment or to otherwise manipulate the data.

In other words, defendant Mellanox is attempting to affirmatively demonstrate that plaintiff’s commissions were not redirected to Shea or Carlson as plaintiff Gur alleges at paragraph 22 of the FAC.

In opposition, plaintiff Gur does not make the assertion that Shea or Carlson took his commissions. Instead, plaintiff contends he entered into a commissions agreement with defendant Mellanox in 2012 and that defendant Mellanox unilaterally changed (without plaintiff Gur’s signed agreement) the commissions formula in mid-2014, thereby diminishing plaintiff Gur’s commissions which would have been greater if calculated under the earlier commission agreement.

In reply, defendant Mellanox contends even under the 2012 commission agreement, plaintiff Gur would not be entitled to the variable compensation that he now claims. However, defendant Mellanox does not provide the court with any evidence in support of this assertion or any explanation as to how its interpretation of the commission agreement is, as a matter of law, the correct interpretation.

Accordingly, defendant Mellanox’s alternative motion for summary adjudication of the second cause of action in plaintiff Gur’s FAC for breach of contract – failure to pay commissions is DENIED.

C. Defendant Mellanox’s motion for summary adjudication of the third cause of action [age discrimination] is DENIED.

“The specific elements of a prima facie case [for discrimination] may vary depending on the particular facts. [Citations.] Generally, the plaintiff must provide evidence that (1) he was a member of a protected class, (2) he was qualified for the position he sought or was performing competently in the position he held, (3) he suffered an adverse employment action, such as termination, demotion, or denial of an available job, and (4) some other circumstance suggests discriminatory motive.” (Guz v. Bechtel National, Inc. (2000) 24 Cal.4th 317, 355 (Guz).)

“Given the varying nature of the problem, it is impossible to make an exact, all-inclusive statement of the elements of a prima facie age discrimination case applicable in all situations. [Citation.] The general requirement is that the employee offer circumstantial evidence such that a reasonable inference of age discrimination arises. The requirement is not an onerous one. [Citation.] [¶] … [A] prima facie case, of age discrimination arises when the employee shows (1) at the time of the adverse action he or she was 40 years of age or older, (2) an adverse employment action was taken against the employee, (3) at the time of the adverse action the employee was satisfactorily performing his or her job and (4) the employee was replaced in his position by a significantly younger person.” (Hersant v. Dept. of Social Services (1997) 57 Cal.App.4th 997, 1003 (Hersant).)

As against this third cause of action, defendant Mellanox begins by arguing that plaintiff Gur cannot establish a prima facie claim for age discrimination because he cannot show (1) that he was performing competently in the position he held; and (2) some other circumstance suggests discriminatory motive. With regard to the first element, defendant Mellanox proffers evidence that at the end of 2014, Shea recommended plaintiff Gur be put on a PIP because he had determined that plaintiff Gur had failed to meet his quotas for six consecutive quarters and had other performance issues. In opposition, plaintiff proffers evidence which would present a triable issue with regard to whether he was performing competently. Specifically, plaintiff Gur proffers evidence that a week prior to his termination, circa late-January 2015, plaintiff Gur delivered an Apple purchase order worth in excess of $5 million, exceeding the approximate $2 million quota required of him for the first quarter of 2015.

With regard to evidence of discriminatory motive, defendant Mellanox acknowledges plaintiff Gur claims Carlson called him a “fucking disrespectful lazy-ass old home phone salesman.” While denying such a statement was actually made, defendant Mellanox argues that even if Carlson made this statement, the court should apply the stray remark doctrine, “i.e., should have categorized the alleged statement[] by [Carlson] as [an] irrelevant stray remark[], and disregarded them in reviewing the merits of the summary judgment motion.” (Reid v. Google, Inc. (2010) 50 Cal.4th 512, 535 (Reid).)

As the California Supreme Court in Reid held, the stray remarks doctrine is not applied as a blanket rule in California. Instead, “[a]n age-based remark not made directly in the context of an employment decision or uttered by a non-decision-maker may be relevant, circumstantial evidence of discrimination.” (Reid, supra, 50 Cal.4th at p. 539.) The term “stray remark” refers to “statements by nondecisionmakers, or statements by decisionmakers unrelated to the decisional process itself.” (Id. at p. 536.) The Reid court recognized that, “the stray remarks doctrine contains a major flaw because discriminatory remarks by a non-decisionmaking employee can influence a decision maker. “If [the formal decision maker] acted as the conduit of [an employee’s] prejudice—his cat’s paw—the innocence of [the decision maker] would not spare the company from liability.” (Shager, supra, 913 F.2d at p. 405.) Many federal circuit courts have adopted Shager’s analysis, finding that discriminatory comments by someone in a position to influence a decision maker were relevant.” (Id. at p. 542.) Here, even though defendant Mellanox claims the decision to terminate plaintiff Gur was not made by Carlson , it is undisputed that Carlson was plaintiff Gur’s supervisor. Thus, this court will not consider Carlson’s remarks to be stray and is, instead, considered relevant.

In addition to challenging plaintiff Gur’s ability to demonstrate a prima facie claim for age discrimination, defendant Mellanox seeks summary adjudication by presenting a legitimate, non-discriminatory basis for terminating plaintiff Gur. “[T]he employer who seeks to resolve the matter by summary judgment must bear the initial burden of showing the action has no merit. The employer carries its burden if, inter alia, it ‘establishes an undisputed legitimate, nondiscriminatory basis for the employment decision.’ Absent ‘substantial responsive evidence of the untruth of the employer’s justification or a pretext, a law and motion judge may summarily resolve the discrimination claim.’” (Slatkin v. Univ. of Redlands (2001) 88 Cal.App.4th 1147, 1156.)

Defendant Mellanox proffers evidence that at the end of 2014, Shea recommended plaintiff Gur be put on a PIP because he had determined that plaintiff Gur had failed to meet his quotas for six consecutive quarters and had other performance issues. On Monday January 12, 2015, Shea and Carlson met with plaintiff Gur and gave him the PIP, but plaintiff refused to sign the PIP, crossed out sections he did not like, and claimed it was a “falsified document” that was “setting him up to fail.” Plaintiff Gur set up a meeting for January 16, 2015 to make additional changes to the PIP. Mellanox made a few additional changes as requested by plaintiff Gur. Plaintiff Gur sought further negotiation regarding the PIP. Plaintiff Gur requested a further meeting which Shea and Carlson agreed to conduct on January 29, 2015 to confirm the PIP and obtain plaintiff’s agreement. It is at that meeting that plaintiff Gur claims Carlson called him a “fucking disrespectful lazy-ass old home phone salesman.” Plaintiff Gur complained to Human Resources of discrimination. Mellanox in-house counsel conducted an investigation and found no discrimination occurred. After learning the results of the investigation, Mellanox terminated plaintiff Gur on February 3, 2015 based on a combination of plaintiff’s performance and conduct related to the PIP, refusal to cooperate and consent to the PIP, and failure and refusal to cooperate with his managers.

Defendant Mellanox has carried its burden by establishing a legitimate, nondiscriminatory basis for terminating plaintiff Gur. To avoid summary adjudication, plaintiff Gur “must produce ‘specific, substantial evidence of pretext.’ [Citation.]” (Godwin v. Hunt Wesson, Inc. (9th Cir. 1998) 150 F.3d 1217, 1221 (Godwin); see also Slatkin, supra, 88 Cal.App.4th at p. 1156.) “When the plaintiff offers direct evidence of discriminatory motive, a triable issue as to the actual motivation of the employer is created even if the evidence is not substantial.” (Godwin, supra, 150 F.3d at p. 1221.)

The United States Supreme Court has held, however, that “the McDonnell Douglas test is inapplicable where the plaintiff presents direct evidence of discrimination.” (Trans World Airlines, Inc. v. Thurston (1985) 469 U.S. 111, 121, 105 S.Ct. 613, 83 L.Ed.2d 523); see also Sada v. Robert F. Kennedy Medical Center (1997) 56 Cal.App.4th 138, 150–151, 65 Cal.Rptr.2d 112, fn. 7 [“The McDonnell Douglas test is typically used in cases where the plaintiff lacks ‘direct’ evidence of the employer’s discriminatory intent”].) Direct evidence is evidence which proves a fact without inference or presumption. (Morgan, supra, 88 Cal.App.4th at p. 67, 105 Cal.Rptr.2d 652.) “Where a plaintiff offers direct evidence of discrimination that is believed by the trier of fact, the defendant can avoid liability only by proving the plaintiff would have been subjected to the same employment decision without reference to the unlawful factor.” (Morgan, supra, 88 Cal.App.4th at pp. 67–68, 105 Cal.Rptr.2d 652.)

(Trop v. Sony Pictures Entertainment Inc. (2005) 129 Cal.App.4th 1133, 1144–45.)

The direct evidence before the court is that Carlson called plaintiff Gur a “fucking disrespectful, lazy, old man, home-phone sales, SOB.” (See p. 364, lines 10 – 13 of Exhibit A to the Declaration of Lisa Garcia in Support of Defendant Mellanox Technologies, Inc.’s Motion for Summary Judgment, etc., Exhibit 1 to Defendant Mellanox Technologies, Inc.’s Appendix of Evidence in Support of Motion for Summary Judgment, etc., emphasis added.) Again, defendant Mellanox attacks this statement under the stray remark doctrine, but as discussed above, the court does not consider the statement to be stray. Since there is direct evidence of discrimination, a triable issue of material fact exists.

Accordingly, defendant Mellanox’s alternative motion for summary adjudication of the third cause of action in plaintiff Gur’s FAC for age discrimination is DENIED.

D. Defendant Mellanox’s motion for summary adjudication of the fourth cause of action [retaliation] is DENIED.

“To establish a prima facie case of retaliation, the plaintiff must show (1) he or she engaged in a protected activity; (2) the employer subjected the employee to an adverse employment action; and (3) a causal link between the protected activity and the employer’s action. Once an employee establishes a prima facie case, the employer is required to offer a legitimate reason for the adverse employment action. If the employer produces a legitimate reason for the adverse employment action, the presumption of retaliation ‘drops out of the picture,’ and the burden shifts back to the employee to prove intentional retaliation.” (Akers v. County of San Diego (2002) 95 Cal.App.4th 1441, 1453.)

In moving for summary adjudication, defendant Mellanox argues first that plaintiff Gur cannot make out a prima facie claim for retaliation when the adverse employment action (PIP) was already in place before plaintiff complained of discrimination. (See Doe v. Capital Cities (1996) 50 Cal.App.4th 1038, 1053—“to the extent the theory can be construed as an effort to allege statutory liability it fails because the alleged acts of retaliation-the physical assaults and threats by Marshall and others-occurred before plaintiff filed his sexual harassment complaint in June 1994 with the Department of Fair Employment and Housing.”) The facts here are distinguishable, however, because although the PIP may have predated plaintiff’s complaint of discrimination, plaintiff’s termination did not, occurring five days later on February 3, 2015. The court is not persuaded by defendant Mellanox’s suggestion that the threat of termination (which predates plaintiff Gur’s complaint of discrimination) is enough to constitute an adverse employment action. Nor is the court persuaded by defendant Mellanox’s argument in reply that plaintiff’s conduct which served as the basis for termination predated plaintiff’s complaint of discrimination and, therefore, precludes a claim for retaliation. The focus is not on plaintiff’s conduct, but rather on defendant’s decision to impose some adverse employment action.

The same evidence offered by defendant Mellanox to demonstrate a legitimate non-discriminatory reason for termination is offered to demonstrate a legitimate non-retaliatory reason for termination.

In opposition, plaintiff Gur apparently argues that there is substantial evidence of retaliatory motive based on the temporal proximity between his protected activity (complaint of discrimination) and his termination. (See p. 13, lines 18 – 19 of Plaintiff’s Opposition, etc.—“There is not a single iota of evidence that anything but the discrimination complaint occurred between the meeting on January 29th and the termination.”) Temporal proximity, however, is not enough. In Loggins v. Kaiser Permanente International (2007) 151 Cal.App.4th 1102, 1112 (Loggins) the court accepted the proposition that “a plaintiff can satisfy the initial burden under the McDonnell Douglas framework by producing evidence of ‘nothing more than … the proximity in time between the protected action and the allegedly retaliatory employment decision.’ ” However, “such evidence of a temporal proximity only satisfies the plaintiff’s initial burden. Once an employee establishes a prima facie case, the employer is required to offer a legitimate, nonretaliatory reason for the adverse employment action. If the employer produces a legitimate reason for the adverse employment action, the presumption of retaliation drops out of the picture, and the burden shifts back to the employee to prove intentional retaliation. [¶] … temporal proximity, although sufficient to shift the burden to the employer to articulate a nondiscriminatory reason for the adverse employment action, does not, without more, suffice also to satisfy the secondary burden borne by the employee to show a triable issue of fact on whether the employer’s articulated reason was untrue and pretextual.” (Loggins, supra, 151 Cal.App.4th at p. 1112; citations and punctuation omitted.)

“The [employee] cannot simply show that the employer’s decision was wrong or mistaken, since the factual dispute at issue is whether discriminatory animus motivated the employer, not whether the employer is wise, shrewd, prudent, or competent. [Citations.] Rather, the [employee] must demonstrate such weaknesses, implausibilities, inconsistencies, incoherencies, or contradictions in the employer’s proffered legitimate reasons for its action that a reasonable factfinder could rationally find them ‘unworthy of credence,’ [citation], and hence infer ‘that the employer did not act for the [the asserted] non-[retaliatory] reasons.’ [Citations.]” [Citations.]

(Hersant, supra, 57 Cal.App.4th at p. 1005; see also Moore v. Regents of the University of California (2016) 248 Cal.App.4th 216, 235 – 236.)

As indicated above, Mellanox terminated plaintiff Gur on February 3, 2015 based on a combination of plaintiff’s performance and conduct related to the PIP, refusal to cooperate and consent to the PIP, and failure and refusal to cooperate with his managers. In opposition, plaintiff Gur contends some of the stated reasons are pretextual. Primarily, plaintiff Gur argues the focus of the PIP was on attainment of sales quotas but plaintiff Gur exceeded his sales quota with the Apple purchase order in late January 2015. Thus, it is plaintiff Gur’s contention that defendant Mellanox’s primary reason for termination (failure to attain sales quotas) is not plausible in view of the substantial Apple purchase order he obtained prior to his termination and prior to his complaint of discrimination. The court finds a trier of fact may have reason to question why defendant Mellanox would insist on terminating plaintiff Gur under these circumstances and whether that proffered reason is pretextual.

Accordingly, defendant Mellanox’s alternative motion for summary adjudication of the fourth cause of action in plaintiff Gur’s FAC for retaliation is DENIED.

E. Defendant Mellanox’s motion for summary adjudication of the fifth cause of action [wrongful termination in violation of public policy] is DENIED.

“To establish a claim for wrongful discharge in violation of public policy, each of the following must be proved: (1) An employer-employee relationship; (2) Termination or other adverse employment action; (3) Termination of plaintiff’s employment was a violation of public policy (or more accurately, a ‘nexus’ exists between the termination and the employee’s protected activity); (4) The termination was a legal cause of plaintiff’s damage; and (5) The nature and the extent of plaintiff’s damage.” (Chin, et al., CAL. PRAC. GUIDE: EMPLOYMENT LITIGATION (The Rutter Group 2017) ¶5:50, citing Holmes v. General Dynamics (1993) 17 Cal.App.4th 1418, 1426.)

Since plaintiff’s fifth cause of action for wrongful termination is derivative of his third and fourth causes of action for age discrimination and retaliation, defendant Mellanox argues that the wrongful termination cause of action fails because the underlying violations of public policy (discrimination and retaliation) fail. However, in light of the court’s rulings on the third and fourth causes of action, defendant Mellanox’s alternative motion for summary adjudication of the fifth cause of action in plaintiff Gur’s FAC for wrongful termination in violation of public policy is DENIED.

F. Defendant Mellanox’s motion for summary adjudication of the sixth cause of action [violation of Labor Code §201] is DENIED.

“If an employer discharges an employee, the wages earned and unpaid at the time of discharge are due and payable immediately.” (Lab. Code, § 201.) Plaintiff Gur alleges, in relevant part, that he brokered a deal with Apple and in doing so, earned commissions and stock, but was never paid any commissions. (FAC, ¶86 – 87.)

In moving for summary adjudication, defendant Mellanox instead focuses on the additional allegation made by plaintiff Gur that he “went on to close a major deal with Apple,” which suggests that the deal closed in the future and prior to plaintiff Gur’s termination. Therefore, plaintiff Gur would not be entitled to any commissions. However, the FAC clearly alleges plaintiff “had earned commissions.” To meet its initial burden, it was incumbent upon defendant to establish with admissible evidence that the Apple deal did not close prior to plaintiff Gur’s termination and that plaintiff Gur had not yet been earned any commissions on the Apple deal. Defendant Mellanox fails to meet its initial burden.

Defendant Mellanox goes on to argue that plaintiff was not entitled to any further stock. However, the court need not reach this issue since it would only partially dispose of plaintiff’s sixth cause of action and partial summary adjudication is not available. Since defendant Mellanox has not met its initial burden, defendant Mellanox’s alternative motion for summary adjudication of the sixth cause of action in plaintiff Gur’s FAC for violation of Labor Code section 201 is DENIED.

G. Defendant Mellanox’s motion for summary adjudication of the seventh cause of action [failure to properly investigate] is DENIED.

A claim for “Failure to Prevent Discrimination” necessarily depends upon establishing that discrimination occurred in the first place. Under FEHA, an employer has an obligation to “take all reasonable steps necessary to prevent discrimination and harassment from occurring.” (See Gov. Code §12940, subd. (k).) A prerequisite to a finding of liability for the failure to take all reasonable steps, however, is a finding that the plaintiff actually suffered unlawful discrimination, harassment, or retaliation. (See Trujillo v. North County Transit Dist. (1998) 63 Cal.App.4th 280, 282 – 283; see also Scotch v. Art Institute of California (2009) 173 Cal.App.4th 986, 1021.) Defendant Mellanox argues initially that since there is no discrimination or retaliation in the first instance, there can be no claim for the failure to prevent it.

Defendant Mellanox argues additionally that it is unclear whether plaintiff Gur’s seventh cause of action is premised on a violation of FEHA, Government Code section 12940, subdivision (k). To the extent that plaintiff Gur is attempting to assert some common law claim for failure to investigate, defendant Mellanox contends it did not breach its duty to investigate. However, in opposition, plaintiff Gur clarifies that his seventh cause of action is premised on a violation of Government Code section 12940, subdivision (k).

In light of the court’s rulings above on the third and fourth causes of action, defendant Mellanox’s alternative motion for summary adjudication of the seventh cause of action for failure to investigate is DENIED.

H. Defendant Mellanox’s motion for summary adjudication of plaintiff’s claim for punitive damages is DENIED.

Pursuant to Civil Code section 3294, punitive damages may be recovered “where it is proven by clear and convincing evidence that the defendant has been guilty of oppression, fraud, or malice.” “In 1980, the Legislature added subdivision (b) to [Civil Code] section 3294, to add a special qualification for employer liability for those damages. Subdivision (b) states, in relevant part, that an employer shall not be liable for punitive damages based on an employee’s acts unless ‘the employer had advance knowledge of the unfitness of the employee and employed him or her with a conscious disregard of the rights or safety of others or authorized or ratified the wrongful conduct for which the damages are awarded or was personally guilty of oppression, fraud, or malice.’ The statute includes an additional qualification for corporate employers, who may not be liable for punitive damages unless ‘the advance knowledge and conscious disregard, authorization, ratification or act of oppression, fraud, or malice [is] on the part of an officer, director, or managing agent of the corporation.’” (White v. Ultramar, Inc. (1999) 21 Cal.4th 563, 566 (White).)

In moving for summary adjudication, defendant Mellanox contends the alleged discrimination and/or retaliation was not committed by an “officer, director, or managing agent.” Carlson, Shea, and Prescher were not officers or directors of Mellanox; and none of them had any authority or discretion over Mellanox’s corporate policies; all had limited duties in only one of many teams/departments within Mellanox; all of them lacked authority to terminate Mellanox employees without senior management approval; and all simply followed corporate policies.

In opposition, plaintiff Gur proffers evidence that the decision to terminate his employment was made and ratified by Amir Prescher (Senior Vice-President of Business Development) with authorization by HR and Eyal Waldman, Mellanox CEO. Thus, even though the actual decision to terminate was made by Prescher, there is evidence that the decision was authorized by an officer of Mellanox.

Accordingly, defendant Mellanox’s alternative motion for summary adjudication of plaintiff Gur’s claim for punitive damages is DENIED.