Case Name: Ortega. v. Board of Trustees of the California State University, et al.
Case No.: 2017-1-CV-309628

According to the allegations of the first amended complaint (“FAC”), plaintiff Lydia Ortega (“Plaintiff”), served as chair of Economics at San Jose State University (“SJSU”) from August 23, 2001 to May 31, 2016, when she was removed from the position prior to the conclusion of a four year term. (See FAC, ¶¶ 12, 15.) Prior to her removal, Plaintiff was subjected to unwelcome conduct from SJSU’s Deal of the College of Social Sciences, Dr. Walter Jacobs (“Jacobs”), who accused Plaintiff of engaging in misconduct, disrupted the orderly functioning of the workplace in order to prevent Plaintiff from completing her work, and solicited, instructed and/or encouraged employees to make untrue statements about Plaintiff in order to harm her reputation within the workplace, thereby creating a hostile work environment. (See FAC, ¶¶ 16-18.) Plaintiff believes that Jacobs subjected Plaintiff to this harassment due to his false and stereotypical views about gender roles—views stated in a published 2007 memoir by Jacobs, Ghostbox. (See FAC, ¶¶ 19, 21-23.) Jacobs specifically: insisted that Plaintiff write a detailed self-critique of her alleged lack of gentleness and inflexibility; told Plaintiff that she must “ask nicely” or her office assistants would no longer perform tasks assigned by her; repeatedly scolded Plaintiff for her alleged lack of niceness, gentleness and flexibility; allowed one of Plaintiff’s office assistants to cease any work assigned by Plaintiff and then scolded Plaintiff when Plaintiff did the work herself; solicited criticism of Plaintiff from numerous individuals, including her administrative assistants and faculty members of the Economics Department; repeatedly confronted Plaintiff with allegations that various people were upset or unhappy with Plaintiff’s management style and methods of communication; and, caused Plaintiff’s administrative assistant to make untrue statements to Plaintiff related to the reassignment of the other office assistant. (See FAC, ¶¶ 24-36.)

On August 17, 2017, the Court sustained defendants Board of Trustees of the California State University (“CSU”), Walter Jacobs (“Jacobs”), and Colleen Haight’s (“Haight”) (collectively, “Defendants”) demurrer to the initial complaint’s first and second causes of action. As to the first cause of action, the Court stated:

Defendants assert that the first cause of action, which is labelled as a claim for “wrongful demotion,” is a Tameny claim for wrongful discipline in violation of public policy. Defendants argue that a common law tort claim, such as a Tameny claim, cannot be alleged against CSU as a matter of law pursuant to Government Code section 815.

In opposition, Plaintiff asserts that her first cause of action is not a Tameny claim for wrongful discipline in violation of public policy. Plaintiff argues that the claim is, instead, one for breach of an implied-in-fact term in her employment contract with CSU. Plaintiff contends that SJSU Policy S14-8 became an implied-in-fact term of the contract between her and CSU, and CSU breached the implied-in-fact term by removing her from the Chair of the Department of Economics position without good cause. Plaintiff asserts that such a claim sounds in contract and is expressly allowed under Government Code section 814.

A claim for breach of an implied-in-fact contract sounds in contract and is separate and distinct from a Tameny claim for wrongful discipline in violation of public policy, which sounds in tort. (See Pugh v. See’s Candies, Inc. (1981) 116 Cal.App.3d 311, 321–22 and 329 (Pugh) [noting there are two limitations on an employer’s right to terminate an at-will employee—one based upon public policy (when an employer’s discharge of an employee violates fundamental principles of public policy) and one based on contract (when the discharge is contrary to the terms of the employment agreement, express or implied)—and holding that the plaintiff demonstrated a prima facie case of wrongful termination in violation of his contract of employment] disapproved on other grounds in Guz v. Bechtel Nat. Inc. (2000) 24 Cal.4th 317, 351 (Guz); see also Guz, supra, 24 Cal.4th at p. 352 [“[T]he employer’s personnel policies and practices may become implied-in-fact terms of the contract between employer and employee. If that has occurred, the employer’s failure to follow such policies when terminating an employee is a breach of the contract itself.”]; Foley v. Interactive Data Corp. (1988) 47 Cal.3d 654, 662-63[the plaintiff sought damages for wrongful discharge on “three distinct theories: (1) a tort cause of action alleging a discharge in violation of public policy (Tameny v. Atlantic Richfield Co. (1980) 27 Cal.3d 167 …), (2) a contract cause of action for breach of an implied-in-fact promise to discharge for good cause only (e.g., [Pugh, supra] …), and (3) a cause of action alleging a tortious breach of the implied covenant of good faith and fair dealing ….”].)

Courts have previously found that a claim for breach of an implied-in-fact agreement not to be demoted without good cause, based on the employer’s official or unofficial policies, is enforceable and sounds in contract. (See e.g., Scott v. Pacific Gas & Electric Co. (1995) 11 Cal.4th 454, 454–59, 463-64 (Scott) disapproved on other grounds in Guz, supra; see also Asmus v. Pacific Bell (2000) 23 Cal.4th 1, 9 and 30 [quoting Scott favorably].)

The first cause of action, although Plaintiff purports it does not allege a Tameny claim for wrongful discipline in violation of public policy, but a claim for breach of an implied-in-fact term in her employment contract with CSU, is challenged by defendants on both grounds. In the first cause of action, Plaintiff alleges that SJSU Policy S14-8 became an implied-in-fact term of the contract between her and CSU; pursuant to that term, CSU could not demote her without good cause; and CSU breached the implied-in-fact term by removing her from the Chair of the Department of Economics position without good cause. (Complaint, ¶¶ 52-57.) There do not appear to be clear allegations in the first cause of action providing that CSU violated a fundamental public policy when it removed Plaintiff from her position as Chair of the Department of Economics.

While Government Code section 815 bars Tameny claims against public entities (Miklosy v. Regents of University of California (2008) 44 Cal.4th 876, 899; Lloyd v. County of Los Angeles (2009) 172 Cal.App.4th 320, 323 and 328–29), Government Code section 814 provides that the doctrine of governmental immunity does not protect public entities from liabilities arising out of contract (Gov. Code, § 814 [“Nothing in this part affects liability based on contract or the right to obtain relief other than money or damages against a public entity or public employee.”]; Roe v. State of California (2001) 94 Cal.App.4th 64, 69 [“ ‘ “[w]hen the state makes a contract … it is liable for a breach of its agreement … and the doctrine of governmental immunity does not apply. [Citations.]” ’ ”]). The first cause of action does not appear to be barred by Government Code section 815.

For the first time in reply, Defendants argue that the first cause of action fails even if it is construed as a claim for breach of an implied-in-fact term in Plaintiff’s employment contract because the terms of Plaintiff’s employment contract are determined by statute, not contract. This point should have been made in Defendants’ moving papers, and Defendants’ attempt to raise the argument for the first time in reply is improper as Plaintiff did not have the opportunity to respond to the argument in her opposition. (See Reichardt, supra, 52 Cal.App.4th at p.764 [points raised for the first time in a reply brief will ordinarily be disregarded because other party is deprived of the opportunity to counter the argument]; see also In re Tiffany, supra, 223 Cal.App.3d at pp.302-303; REO, supra, 69 Cal.App.4th at p.500.)

As the Court has granted leave to amend as to other challenged causes of action, and to allow the parties to clarify the pleading allegations and properly address their legal arguments as to each, the demurrer to the first cause of action is SUSTAINED, with 10 days’ leave to amend.

(August 17, 2017 order re: demurrer, pp.6:17-25, 7:1-28, 8:1-26, 9:1-3.)

As to the second cause of action, the Court’s August 17, 2017 order stated:

Defendants argue that the second cause of action, which alleges a claim for hostile work environment harassment based on gender in violation of the Fair Employment and Housing Act (the “FEHA”), fails because Jacobs’ alleged conduct “involve[s] some aspect of [his] exercise of his supervisorial authority” and harassment consists of a type of conduct not necessary for performance of a supervisory job. They further argue that the allegations fail to demonstrate that Jacobs’ actions rose to the level of severe or pervasive conduct sufficient to alter the conditions of employment and create an abusive working environment.

To establish a prima facie case of harassment, a plaintiff is required to show: (1) he/she is a member of a protected class; (2) he/she was subject to unwelcome harassment; (3) the harassment related to membership in the protected class; (4) the harassment unreasonably interfered with his/her work performance by creating an intimidating, hostile or offensive work environment; and (5) the defendant is liable for the harassment. (See Thompson v. City of Monrovia (2010) 186 Cal.App.4th 860, 876 [dealing specifically with harassment based on race].) “Harassment, which may be verbal, physical, or visual and communicates an offensive message to the harassed employee, cannot be occasional, isolated, sporadic, or trivial; rather the plaintiff must show a concerted pattern of harassment of a repeated, routine or a generalized nature. Whether the harassment is sufficiently severe or pervasive to alter the conditions of the victim’s employment and create an abusive environment must be assessed from the perspective of a reasonable person belonging to the racial or ethnic group of the plaintiff.” (Id. at p. 877, internal citations omitted; see also Rehmani v. Super. Ct. (2012) 204 Cal.App.4th 945, 951 [“Whether the conduct of the alleged harassers was sufficiently sever or pervasive to create a hostile or abusive working environment depends on the totality of the circumstances.”].)

As Defendants persuasively argue, Plaintiff has not adequately pled harassment because her claim is based entirely on personnel management actions taken by Jacobs. (See Complaint, ¶¶ 14-17, 20-28, 60-67.) As the California Supreme Court has explained:

[C]ommonly necessary personnel management actions such as hiring and firing, job or project assignments, office or work station assignments, promotion or demotion, performance evaluations, the provision of support, the assignment or nonassignment of supervisory functions, deciding who will and who will not attend meetings, deciding who will be laid off, and the like, do not come within the meaning of harassment. These are actions of a type necessary to carry out the duties of business and personnel management. These actions may retrospectively be found discriminatory if based on improper motives, but in that event the remedies provided by the FEHA are those for discrimination, not harassment. Harassment, by contrast, consists of actions outside the scope of job duties which are not of a type necessary to business and personnel management. This significant distinction underlies the differential treatment of harassment and discrimination in the FEHA.

(Reno v. Baird (1998) 18 Cal.4th 640, 646-647, italics added, citing Janken v. GM Hughes Electronics (1996) 46 Cal.App.4th 55, 63-65; see Serri v. Santa Clara University (2014) 226 Cal.App.4th 830, 869-870.)

Accordingly, the demurrer to the second cause of action is SUSTAINED, with 10 days’ leave to amend.

(August 17, 2017 order re: demurrer, pp. 9:6-27, 10:1-21.)

On August 28, 2017, Plaintiff filed the FAC, asserting causes of action for:

1) Wrongful demotion (deprivation of due process rights protected by Art. 1, Sec. 7 of the California Constitution) (against CSU);
2) Hostile work environment based on gender (against CSU and Jacobs);
3) Gender discrimination (against CSU); and,
4) Defamation (against CSU and Haight).

Defendants demur to the first and second causes of action of the FAC on the grounds that: the Court lacks jurisdiction as to the causes of action; the causes of action are uncertain; and, the causes of action fail to state facts sufficient to constitute a viable cause of action. Defendants also move to strike allegations relating to punitive damages.

Defendants’ request for judicial notice of the complaint, the August 17, 2017 order and the collective bargaining agreement between the board of trustees of CSU and the California Faculty Association, effective November 12, 2015-June 30, 2018 is GRANTED. (Evid. Code § 452, subds. (c), (d), (h); see also Stormedia Inc. v. Super. Ct. (Werczberger) (1999) 20 Cal.4th 449, 457, fn.9 (request for judicial notice is appropriate where “both sides refer to the documents in their briefs” thereby “implicitly request[ing] judicial notice of one of the documents”).)

Demurrer to the first cause of action

As previously stated, Plaintiff asserted that the initial complaint’s first cause of action for wrongful demotion alleged a claim for breach of an implied-in-fact term in her employment contract with CSU. The FAC’s first cause of action is no longer premised on a breach of an implied-in fact term of her employment contract; instead, she now alleges that her removal from her chairperson position constitutes the deprivation of a property interest without due process of law. (See FAC, ¶¶ 78-80.) In opposition, Plaintiff acknowledges “that her Count One could not sound as a breach of implied contract claim, for the reasons stated by Defendants….” (Pl.’s opposition to demurrer, p.6:13-15.) Plaintiff nevertheless contends that she “did not exceed the scope of leave to amend granted by this Court, especially considering the character of the Court’s deliberations on this matter, which emphasized the importance of clarifying the pleading [sic] allegations and responsive arguments in an efficient manner that would not waste judicial resources.” (Id. at p.6:16-23.) However, Plaintiff is abandoning her cause of action for breach of an implied-in fact term of her employment contract, and adding a new cause of action for a violation of her Constitutional rights. “The plaintiff may not amend the complaint to add a new cause of action without having obtained permission to do so, unless the new cause of action is within the scope of the order granting leave to amend.” (Harris v. Wachovia Mortg., FSB (2010) 185 Cal.App.4th 1018, 1023, citing Patrick v. Alacer Corp. (2008) 167 Cal.App.4th 995, 1015.) Clearly, Plaintiff was not authorized to add an entirely new cause of action.

Regardless, it is of no import as the first cause of action does not state facts sufficient to constitute a viable cause of action. The first cause of action alleges that Plaintiff was removed from the position of Chair of Economics on May 31, 2016 prior to the expiration of her fourth term in office, without a statement of good cause for removal, despite her repeated objections that SJSU Policy S14-8 required such a statement. (See FAC, ¶¶ 40-41, 43-50, 71-73, 75-76.) Plaintiff also alleges that “SJSU Policy S14-8, at section VIII(1) states that SJSU Department Chairs may only be removed by administrators for ‘compelling reasons, such as criminal activity, manifest breach of ethics, gross malfeasance of duties and other extremely serious personnel matters.” (FAC, ¶ 68.) Plaintiff contends that there was no good cause for her demotion because she did not engage in any criminal activity, breach of ethics, malfeasance of duties or engage in any misconduct constituting ‘extremely serious personnel matters’… [and thus] should have been permitted to continue as Chair of Economics until the expiration of her term of office on August 18, 2017.” (FAC, ¶¶ 72-73.)

The FAC alleges that “[b]ased on the approval and signature of the President of SJSU, exercising powers delegated by the CSU Board of Trustees, SJSU Policy S14-8 constitutes a policy of the California State University with the force and effect of statute.” (FAC, ¶ 70.) However, this is a conclusion of law and on demurrer, the Court does not admit conclusions of law. (See Serrano v. Priest (1971) 5 Cal.3d 584, 591 (stating “[w]e treat the demurrer as admitting all material facts properly pleaded, but not contentions, deductions or conclusions of fact or law”); see also Popescu v. Apple Inc. (2016) 1 Cal.App.5th 39, 59.) Further, as Defendants have pointed out, the courts have already determined that the relevant statutes provide that a departmental chairmanship in the California State University and Colleges may be terminated at any time by a president and that grievance procedures are not available. In Cohen v. Board of Trustees (1979) 97 Cal.App.3d 541, the plaintiff was a professor in the mathematics department and was appointed the chairperson of the mathematics department. (Id. at p.543.) The plaintiff filed a grievance seeking a due process review of his performance, and the Cohen court determined that he was not entitled to a grievance hearing because “[a] departmental chairmanship is… an ‘Academic-administrative assignment’… [and] academic-administrative assignments at a campus may be terminated at any time by a president.” (Cohen, supra, 97 Cal.App.3d at p.544, citing Cal. Admin. Code, tit.5, §§ 42700, subds. (1), (p)(1), and Zumwalt v. Trustees of Cal. State Colleges (1973) 33 Cal.App.3d 665, 675; see also Johnston v. Trustees of Cal. State University & Colleges (1984) 151 Cal.App.3d 1003, 1008 (stating “[a] public employee serving at the pleasure of the appoint authority may constitutionally be terminated without judicially cognizable good cause and without a hearing”), citing Bogacki v. Board of Supervisors (1971) 5 Cal.3d 771, 782-783.) Likewise, in Zumwalt, supra—a case relied upon by Plaintiff—the court noted that “appointment as chairman is a work assignment which clothes a faculty members with administrative duties but not with a higher position or rank.” (Zumwalt, supra, 33 Cal.App.3d at p.675.) Thus, the Zumwalt court noted, “the codified rules of the college trustees prevail over practices and policies emanating from the administration or faculty of an individual institution” and thus the policy or rule of Fresno State College providing a three year term “would clash with the governing law as expressed in the trustee’s rules.” (Id. at pp. 675-676.) In discussing the plaintiff’s due process rights, the Zumwalt court stated:

When a faculty member in the California state college system becomes a department chairman, he accepts an academic-administrative assignment under a published, codified governing rule which permits the college president to remove him “at any time” with the consent of the chancellor. (Cal. Admin. Code, tit. 5, § 43594, fn. 6, ante.) Having accepted the chairmanship at the pleasure of the college president, the faculty member may not later claim constitutional protection against deprivation at the pleasure of the college president.

(Id. at p. 678.)

Thus, it is clear that SJSU Policy S14-8 does not have the “force and effect as a statute” as alleged in the FAC, and Plaintiff does not have a property interest from which she can be deprived such that her due process rights are implicated.

Plaintiff nevertheless cites to Zumwalt for her belief that “constitutional due process applies to protect that employee from being ‘exposed to notoriety in the academic community.’” (Pl.’s opposition to demurrer, p.9:16-21.) Plaintiff asserts that “the language of Policy S14-8 created the impression among Ortega’s colleagues that, because she was removed from the Chair position, she must therefore have engaged in the type of conduct justifying administrative removal under the policy, such as criminal activity, manifest breach of ethics or gross malfeasance of duties.” (Id. at p.9:20-26, citing FAC, ¶¶ 72-74.) Plaintiff also alleges that the subsequent departmental chair, Colleen Haight, who allegedly made false statements regarding Plaintiff after Haight was nominated and elected by faculty, and then assumed the position of Economics Department chair, “created significant reputational consequences for Ortega… and violated the Due Process clause of the California Constitution by creating a mutually explicit understanding regarding administrative removal of SJSU Department Chairs, while failing to honor the justified expectations created by that understanding.” (Id. at pp. 9:25-28, 10:1-9.)

The Zumwalt court did state that “[a] constitutional right to procedural due process exists when the state accompanies its action with charges which might seriously damage the individual’s reputation or career.” (Zumwalt, supra, 33 Cal.App.3d at p.678.) However, in Zumwalt, the plaintiff “was removed from the chairmanship on orders of the college president… accomplished by acting dean Rea, who handed Dr. Zumwalt a letter relieving him of his duties, and by campus policemen who changed the lock on the office doors and sealed the filing cabinets.” (Id. at p. 669.) In finding that Zumwalt was removed “in a manner damaging to his reputation and career,” the court stated:

Although no charges were made, Dr. Zumwalt’s removal was accomplished in a manner damaging to his reputation and career. “Reassignment” or “termination of an academic-administrative assignment” are euphemistic legalisms when used to describe an action accompanied by campus police, changed locks and sealed files. Without some showing of justification, the method chosen by the college administration appears as a gross violation of academic amenities. Without revealing the existence or nonexistence of charges, the method of removal was as damaging as though serious charges had in fact been made. The show of force implied that force was necessary; resort to locks implied that locks were necessary.

Dr. Zumwalt’s removal and its concomitants of policemen, changed locks and sealed files had wide publicity and excited much comment. Descriptions of the incident were carried in San Francisco, Los Angeles and Fresno newspapers and distributed by Associated Press and a college press service. Publicity appeared in such distant publications as The New Yorker magazine and a Charlottesville, Virginia, newspaper. Various faculty organizations and students met in protest. The published stories revealed that 13 faculty members at Fresno State College were dismissed at about the same time. One official connected with the college system was quoted in praise of the weeding out of “loose nuts on the faculties.” (See fn. 13.) Other accounts referred to the events as a “purge” of liberals.

(Id. at p.679.)

In the instant case, the first cause of action does not allege any such similar circumstances. In Cohen, supra, the court also analyzed Zumwalt, and it too discussed Zumwalt, and the court’s focus on the accompaniment of a show of force, finding a lack of any such circumstances. (See Cohen, supra, 97 Cal.App.3d at pp.545-546.) Here, the first cause of action does not allege the use of any force accompanying the Plaintiff’s removal from the chairperson position, and plainly alleges that no charges accompanied Plaintiff’s removal. That her successor allegedly made defamatory comments about Plaintiff after her removal, and the successor’s nomination, election and assumption of the position is immaterial as to a cause of action for violation of her due process rights. Plaintiff does not assert that any such use of force accompanied her removal. (See Goodman v. Kennedy (1976) 18 Cal.3d 335, 349 (stating that “Plaintiff must show in what manner he can amend his complaint and how that amendment will change the legal effect of his pleading”), quoting Cooper v. Leslie Salt Co. (1969) 70 Cal.2d 627, 636; see also Hendy v. Losse (1991) 54 Cal.3d 723, 742 (stating that “the burden is on the plaintiff… to demonstrate the manner in which the complaint might be amended”).) Defendants’ demurrer to the first cause of action for wrongful demotion—deprivation of due process rights protected by Art. 1, Sec. 7 of the California Constitution is SUSTAINED without leave to amend.

Demurrer to the second cause of action

The second cause of action for hostile work environment based on gender alleges that Jacobs subjected Plaintiff “to severe, widespread and persistent harassment based on Ortega’s gender,” based on: his invitation to other faculty and staff to speak to him about her communication and management style; his demand that Plaintiff change her perceived inflexible management practices; his presentation of claims that various persons had complained about her communications practices, but refused to offer details; his demands that she change her communication practices without providing specifics as to how to adjust her behavior; his requests that Plaintiff “ask nicely” if she wished her administrative assistants to perform their work; his investigation of Plaintiff in which he solicited faculty and staff for criticism of Plaintiff’s management; his demands that Plaintiff write critical self-evaluations in which she faulted herself for alleged poor communication; his deliberate interference with Plaintiff’s ability to manage her administrative assistants; and, his removal of Plaintiff from her chairperson position. (See FAC, ¶¶ 82-100.) Defendants again demur to this cause of action on the ground that the alleged facts involve Jacobs’ exercise of his supervisorial authority, and none of the alleged acts rise to the level of “severe or pervasive to be actionable. (See Fisher v. San Pedro Peninsula Hospital (1989) 214 Cal.App.3d 590, 608-610 (stating that “[f]or [hostile work environment] sexual harassment to be actionable, it must be sufficiently severe or pervasive ‘to alter the conditions of [the victim’s] employment and create an abusive working environment… [i]n determining what constitutes ‘sufficiently pervasive’ harassment, the courts have held that acts of harassment cannot be occasional, isolated, sporadic, or trivial, rather the plaintiff must show a concerted pattern of harassment of a repeated, routine or a generalized nature”); see also Janken v. GM Hughes Electronics (1996) 46 Cal.App.4th 55, 63 (stating that “harassment consists of a type of conduct not necessary for performance of a supervisory job…. [i]nstead, harassment consists of conduct outside the scope of necessary job performance, conduct presumably engaged in for personal gratification, because of meanness or bigotry, or for other personal motives… [h]arassment is not conduct of a type necessary for management of the employer’s business or performance of the supervisory employee’s job”).) In opposition, Plaintiff merely argues that “[t]he harassing conduct alleged by Ortega was pervasive, in that it continued for an extended period and totally undermined Ortega’s ability to perform her assigned duties, as well as causing her psychological and emotional harm… [a]s such, Ortega has alleged facts sufficient to support a prima facie case of discrimination.” (Pl.’s opposition to demurrer, p.12:8-20.) However, as with the initial complaint’s second cause of action, Plaintiff still fails to allege facts sufficient to support a cause of action for hostile work environment because her claim is based entirely on personnel management actions taken by Jacobs and does not otherwise allege any type of conduct that demonstrates a concerted pattern of harassment that is sufficiently severe and/or pervasive. Defendants’ demurrer to the second cause of action is also SUSTAINED without leave to amend.

Defendants’ motion to strike allegations supporting punitive damages

In light of the above ruling, the motion to strike allegations supporting punitive damages as to defendant Jacobs is MOOT.

The motion to strike allegations supporting punitive damages as to defendant Haight is DENIED.