2013-00151239-CU-OE

Joshua Jarreau Hyman vs. Apple, Inc.

Nature of Proceeding:      Motion to Strike
Nature of Proceeding:      Motion to Strike

Filed By:    Ruggles, Matthew J.

Defendant Apple Inc.’s motion to strike punitive damages from Plaintiff Joshua Jarreau
Hyman’s complaint is denied.

In this action, Plaintiff asserts numerous FEHA related causes of action arising from
allegations that Apple discriminated against him and ultimately terminated him based
upon his religious beliefs.  He alleges that his manager, Chuck Harvey, refused to
submit his request for Saturdays off due to religious observance.  He also alleges that
he had additional conflicts with Harvey regarding his time card and Harvey’s refusal to
submit the time card, Harvey wrongfully accusing him of misusing company time, and
Harvey issuing unwarranted warnings and disciplinary notices.  Plaintiff alleges Harvey
was investigated for these incidents, placed on leave, and then eventually cleared.  He
alleges that three days after Harvey returned from leave, he informed Plaintiff that
Plaintiff was terminated for misusing company time.

Defendant seeks to strike punitive damages allegations on the basis that Plaintiff failed
to adequately allege that an officer, director or managing agent of Defendant
authorized or ratified Harvey’s conduct towards Plaintiff.

In the case of a corporation acting through its employees or agents, punitive damages
will not lie unless (1) an officer, director, or managing agent of the corporate employer
is guilty of malice, oppression, or fraud; (2) an officer, director, or managing agent of
the corporate employer authorized or ratified the wrongful conduct for which punitive
damages are awarded, or (3) an officer, director, or managing agent of the corporate
employer had advance knowledge of the unfitness of an employee but nevertheless
chose to hire him or her. Civil Code § 3294(b). “Managing agent” under Civil Code §
3294(b) means “only those corporate employees who exercise substantial
independent authority and judgment in their corporate decision making so that their
decisions ultimately determine corporate policy.”  ( White v. Ultramar. Inc. (1999) 21
th
Cal.4   563, 566-67.)  “The scope of a corporate employee’s discretion and authority
under our test is a question of fact for decision on a case-by-case basis.”  (Id.
[emphasis added].)

Here, Plaintiff adequately alleged facts supporting a claim for punitive damages
against Defendant.  First, the Court rejects Defendant’s contention that Plaintiff does
not allege that Harvey was a managing agent.  Indeed, the conduct at issue in the
complaint revolves around the conduct allegedly directed against Plaintiff by Harvey
who was alleged to be his manager.  (Comp. ¶ 11.)  In addition, Plaintiff alleged in
each cause of action, that the “above described actions (e.g., Harvey’s actions) were
perpetrated and/or ratified by a managing agent or officer of Defendant.”  (Comp. ¶¶
34, 44, 49, 54, 58.)  Thus, the clear import is that Plaintiff alleged that Harvey was a
managing agent.

Defendant’s argument that Plaintiff failed to allege that Harvey had “substantial
authority’ to establish or change corporate policy given the allegations in the complaint
that Plaintiff was able to complain about Harvey to HR which ultimately placed Harvey
on leave, does not, for pleading purposes, establish as a matter of law, that Harvey
was a low-level manager unable to establish/change corporate policy.  Indeed,
“principal liability for punitive damages does not depend on employees’ managerial
level, but on the extent to which they exercise substantial discretionary authority over
decisions that ultimately determine corporate policy.  Thus, supervisors who have
broad discretionary powers and exercise substantial discretionary authority in the
th
corporation could be managing agents.”  ( White, supra, 21 Cal.4   at 577.)  Whether or
not Harvey is a managing agent is a question of fact not appropriately resolved on a
pleading motion.  Indeed, none of the cases cited by Defendant involved pleading
issues, but instead involved whether the evidence showed a specific employee was a
th
managing agent or not.  (Id., Kelly-Zurian v. Wohl Shoe Co. (1994) 22 Cal.App.4   397,
421-422 [discussing sufficiency of evidence at trial];  Cruz v. Homebase (2000) 83
th
Cal.App.4   160, 168 [same].)  Further, while Defendant points to the allegations that
its HR department ultimately told Harvey he could not refuse to consider Plaintiff’s
request to take Saturdays off and “granted time in conformity with his religion” this
does not as Defendant contends in reply, demonstrate that Harvey lacked the requisite
discretionary authority for a managing agent. “Managing agent” under Civil Code §
3294(b) means “only those corporate employees who exercise substantial
independent authority and judgment in their corporate decision making so that their
decisions ultimately determine corporate policy.”  White v. Ultratmar. Inc. (1999) 21
th
Cal.4   563, 566-67. The scope of a corporate employee’s discretion and authority
under this test is a question of fact for decision on a case-by-case basis.  Id. Again,
this is a question of fact that cannot be resolved on the pleadings.

The motion is denied.

The minute order is effective immediately.  No formal order pursuant to CRC Rule
3.1312 or further notice is required.