2013-00147015-CU-DF

Luis Franco vs. Farmers Rice Cooperative

Nature of Proceeding:        Hearing on Demurrer to First Amended Complaint

Filed By:    Murphy, Dennis R.

Defendants’ Farmers Rice Cooperative (“FRC”) and Greg Huwes’ Demurrer to the First
Amended Complaint is SUSTAINED, in part with and without leave to amend and
OVERRULED in part, as set forth below.

Defendants’ Request for Judicial Notice is GRANTED.

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Plaintiff’s First Amended Complaint (FAC) sets forth seven causes of action: the 1   for
wrongful discharge in violation of public policy (Labor Code, sec. 6310), the 2nd for
statutory violation of Labor Code, sec. 6310, the 3rd for statutory violation of Labor

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Code, sec. 1102.5, the 4   for libel and slander, the 5   for intentional infliction of
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emotional distress, the 6   for wrongful termination in violation of public policy and the 7
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Defendants demur to the 1  , 2            , 3 , 6   and 7   causes of action, together with a
demurrer to the entire complaint on the grounds of misjoinder of plaintiffs.

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Demurrer by defendant Huwes’ to the 1   for wrongful discharge in violation of public
policy is SUSTAINED, without leave to amend.

Individuals who do not themselves qualify as employers may not be sued for wrongful
termination.  An individual who is not an employer cannot commit the tort of wrongful
discharge in violation of public policy; rather, he or she can only be the agent by which
an employer commits that tort. Miklosy v. Regents of University of California (2008) 44
Cal. 4th 876, 900.

Plaintiff concedes that Huwes was his supervisor, not his employer; therefore he
cannot state facts sufficient to constitute a cause of action against the individual
defendant.

The entity defendant, FRC, does not demur to this cause of action.

Demurrers to the 2nd for violation of Labor Code, sec.  6310, and the 3rd for violation of
Labor Code, sec. 1102.5, are OVERRULED.

Moving party relies upon MacDonald v. State of California (2013) 219 Cal. App. 4th 67,
recently decided by the Third District Court of Appeal, for the proposition that an
employee must exhaust the administrative remedy set forth in Labor Code section 98.7
before filing suit retaliatory discharge in violation of sections 1102.5 and 6310. That
case has been denied review and ordered depublished by the California Supreme
Court on Nov. 26, 2013 since the filing of the moving papers, and therefore may not be
relied upon.

In Campbell, the Court concluded that an employee of the Regents of the University of
California must exhaust university internal administrative remedies before filing suit in  superior court for retaliatory termination under   the “whistleblower” statute, Labor
Code section 1102.5.

Here, Labor Code section 98.7 provides in relevant part: “Any person who believes
that he or she has been discharged or otherwise discriminated against in violation of
any law under the jurisdiction of the Labor Commissioner may file a complaint with the
division within six months after the occurrence of the violation.”

That statutory language of Labor Code, sec. 98.7 (f) further provides: “ The rights and
remedies provided by this section do not preclude an employee from pursuing any
other rights and remedies under any other law.”

This statutory language leads to the conclusion, as in Lloyd v. County of Los Angeles
(2009) 172 Cal. App. 4th 320, 331, that Labor Code section 98.7 merely provides the
employee with an additional remedy, which the employee may choose to pursue, but
does not require that a plaintiff exhaust his administrative remedies with the Labor
Commissioner, prior to pursuing a statutory cause of action under either Labor Code,
secs. 6310 or 1102.5.

As McDonald has been depublished, and Lloyd has not, this Court cannot conclude as
a matter of law that the permissive language in Labor Code, sec. 98.7 makes
mandatory the exhaustion of administrative remedies by an employee prior bringing
suit under Labor Code, secs. 6310 or 1102.5.

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Demurrer to the 6   for wrongful termination in violation of public policy and to the 7
for statutory violation of California Labor Code, sec. 230(b) is SUSTAINED, with leave
to amend.

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The 6   and 7   causes of action, pursuant to California Labor Code §230(b) are based
on the allegations that defendant  FRC and Huwes accused Franco of “keying” Huwes’
car.

Martinez took time off from work and pursuant to a subpoena served on him, appeared
at an arbitration hearing to give testimony with regard to FRC’s allegations against Luis
Franco on December 19, 2012.  Martinez alleges he testified truthfully regarding his
conversation with Huwes in which Huwes admitted that he had no knowledge of who it
was that had keyed his vehicle.

After the termination of the investigation, Martinez was falsely accused by FRC of
having violated certain of FRC’s “housekeeping” rules with regard to the testimony that
Martinez had given at the investigation. Martinez was demoted from his position as a
supervisor and told that he could continue to work at FRC only as a miller.

It is further alleged that FRC’s demotion of Martinez was wrongful and in violation of
California Labor Code §230 and public policy, because the adverse employment action
was in retaliation for Martinez having given adverse testimony to the wrongful
termination of Franco by FRC.

Lab Code § 230 prohibits discharge, discrimination, or retaliation against employee
serving on jury or as witness or seeking relief against domestic violence or sexual
assault. It was enacted as Victims of Domestic Violence Employment Leave Act.
Subsection (b) provides: “An employer may not discharge or in any manner
discriminate or retaliate against an employee, including, but not limited to, an
employee who is a victim of a crime, for taking time off to appear in court to comply
with a subpoena or other court order as a witness in any judicial proceeding .”

The parties dispute whether a contractual arbitration constitutes a “judicial proceeding”
for the purposes of Labor Code, sec. 230, and whether the proceedings under the
statute are limited to cases involving domestic violence.

The Court cannot find that Civil Code, sec. 47(b) defines a “judicial proceeding” for the
purposes of Labor Code, sec. 230.  Section 47 deals with the privilege accorded
truthful testimony.

The statutory purpose of Labor Code, sec. 230 appears to be to protect an employee
testifying in a domestic violence action, not in a contractual arbitration regarding
employment.

However, the Court concurs that sufficient facts are set forth to permit the plaintiff to
allege a Tameny claim for wrongful termination in violation of the public policy requiring
truthful testimony in any judicial or arbitral hearing. Plaintiff may have leave to amend.

Demurrer to the entire complaint on the grounds of misjoinder of plaintiffs is
OVERRULED.

Defendants argue that Plaintiffs’ actions have been improperly joined in a single
complaint.  With respect to the scope of permissive joinder of actions, CCP § 378
reads:

(a)     All persons may join in one action as plaintiffs if:

(1) They assert any right to relief jointly, severally, or in the alternative, in respect of or
arising out of the same transaction, occurrence, or series of transactions or
occurrences and if any question of law or fact common to all these persons will arise in
the action; or

(2) They have a claim, right, or interest adverse to the defendant in the property or
controversy which is the subject of the action.

(b) It is not necessary that each plaintiff be interested as to every cause of action or as
to all relief prayed for. Judgment may be given for one or more of the plaintiffs
according to their respective right to relief.

“The purpose of section 378 is to permit the joinder in one action of several causes
arising out of identical or related transactions and involving common issues.”  (Moe v.
Anderson (2012) 207 Cal.App.4th 826, 832-833 [quoting Coleman v. Twin Coast
Newspaper, Inc. (1959) 175 Cal.App.2d 650, 653] [brackets omitted].)  “The statute
should be liberally construed so as to permit joinder whenever possible in furtherance
of this purpose.”  (Moe at 833 [quoting Coleman at 653].)  However, a joint action that
is not based upon a single transaction or occurrence, or is based upon unrelated
transactions or occurrences, is improper.  (Id.)  The question whether plaintiffs are
properly joined in a single action may be raised on demurrer.  (CCP § 430.10(d);
Anaya v. Superior Court (1984) 160 Cal.App.3d 228, 230-232.)
The Court finds that  both Franco and Martinez may join in one action as plaintiffs as
they both assert the right to relief jointly, severally, or in the alternative, in respect of or
arising out of the same series of transactions or occurrences and if any question of law
or fact common to all these persons will arise in the action. C.C.P., sec.  378(a)(1).

Plaintiffs may file and serve their Second Amended Complaint not later than Monday,
Dec. 23, 2013.  The responsive pleading shall be due filed and served 10 days
thereafter, 15 days if service is by mail.

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

Item   11   2013-00147015-CU-DF

Luis Franco vs. Farmers Rice Cooperative

Nature of Proceeding:    Motion to Strike First Amended Complaint

Filed By:   Murphy, Dennis R.

Defendants’ Farmers Rice Cooperative (“FRC”) and Greg Huwes’ Motion to strike
Specified Portions of  the First Amended Complaint is unopposed and is GRANTED.

As the demurrer to the 1st Cause of action has been SUSTAINED, without leave as to
defendant Huwes, the Second Amended Complaint shall delete his name from the 1st
cause of action.

The prayer for attorneys’ fees under 29 U.S.C. 2617(a)(3) is also ordered stricken.  No
cause of action under that section has been alleged, and plaintiffs have failed to
oppose this motion to strike.

Plaintiffs may file and serve their Second Amended Complaint not later than Monday,
Dec. 23, 2013.  The responsive pleading shall be due filed and served 10 days
thereafter, 15 days if service is by mail.

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