1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA
11 CHARLES MATTHEW ERHART, Case No. 15-cv-02287-BAS-NLS 12 consolidated with Plaintiff, 15-cv-02353-BAS-NLS 13 ORDER DENYING BOFI’S 14 v. MOTION IN LIMINE NO. 4 TO
15 BOFI HOLDING, INC., EXCLUDE EVIDENCE OF CONDUCT AND STATEMENTS 16 Defendant. THAT ARE NOT ACTIONABLE (ECF No. 220) 17 And Consolidated Case 18 19 20 Presently before the Court is BofI Holding, Inc.’s Motion in Limine No. 4 to 21 Exclude Evidence of Conduct and Statements that Are Not Actionable. (ECF No. 22 220.) Erhart opposes. (ECF No. 223.) The Court heard argument on the motion. 23 (ECF No. 230.) For the following reasons, the Court DENIES BofI’s Motion in 24 Limine No. 4. 25 I. BACKGROUND 26 The Court and the parties are familiar with the story behind these consolidated 27 cases awaiting trial. Erhart has whistleblower retaliation claims and a defamation 1 Erhart asserts that some of BofI’s retaliatory conduct occurred after his 2 employment ended on June 9, 2015. For example, in November 2015, the Bank’s 3 CEO allegedly told employees he was going to “bury the whistleblower.” (Katz Decl. 4 Ex. 4, at 361:4–18, ECF No. 220-6.) 5 As for Erhart’s defamation claim, he has identified various statements 6 throughout this case. For instance, Erhart claims that in mid-to-late 2014, Senior 7 Vice President Tolla called him “Seeking Alpha”—a reference to the investment blog 8 that had published negative articles about BofI. (Katz Decl. Ex. 3, at 248:21–249:3, 9 ECF No. 220-5.) This statement was made “in the bathroom” and not to anyone else. 10 (See id.) 11 BofI now brings a sweeping motion in limine with two goals. (ECF No. 220.) 12 First, the Bank seeks to exclude evidence of any post-termination conduct, arguing 13 this conduct is not relevant to Erhart’s whistleblower retaliation claims. (Id.) 14 Second, the Bank seeks an individualized determination that seven statements are not 15 actionable for Erhart’s defamation claim. 16 II. LEGAL STANDARD 17 A party may use a motion in limine to exclude inadmissible or excludable 18 evidence before it is introduced at trial. Luce v. United States, 469 U.S. 38, 40 n.2 19 (1984). Only relevant evidence is admissible. Fed. R. Evid. 402. Evidence is 20 relevant if it has any tendency to make a fact more or less probable than it would be 21 without the evidence, and the fact is of consequence in determining the action. Id. 22 401(a)–(b). 23 Relevant evidence may be excluded if its probative value is substantially 24 outweighed by, among other things, the danger of unfair prejudice or wasting 25 time. Fed. R. Evid. 403. The Rule 403 balancing inquiry is made on a case-by-case 26 basis, requiring an examination of the surrounding facts, circumstances, and 27 issues. United States v. Lloyd, 807 F.3d 1128, 1152 (9th Cir. 2015). 1 III. ANALYSIS 2 There are two complications with BofI’s fourth motion in limine. First, just 3 because post-termination conduct may not be actionable for Erhart’s whistleblower 4 retaliation claims does not mean it is irrelevant. As the Court highlighted at oral 5 argument, the question is whether the evidence is admissible because it shows that 6 something of consequence in the case is more likely than not. See Fed. R. Evid. 401. 7 To illustrate, the Court considers the CEO’s post-termination statement that he 8 is going to “bury the whistleblower.” The Court agrees that post-employment 9 conduct is not actionable for the retaliation element of Erhart’s claims. To recap, 10 these causes of action are retaliation claims under three statutes: Sarbanes–Oxley § 11 806, 18 U.S.C. § 1514A; Dodd–Frank § 21F, 15 U.S.C. § 78u-6; and California’s 12 general whistleblower statute, Cal. Labor Code § 1102.5(b).1 13 Erhart correctly argues that the law permits retaliation claims based on post- 14 employment conduct in a different context—Title VII. See Robinson v. Shell Oil Co., 15 519 U.S. 337 (1997) (concluding ambiguous term “employees” in Title VII includes 16 former employees, allowing them to bring a claim based on negative, retaliatory job 17 references); see also Hashimoto v. Dalton, 118 F.3d 671, 674 (9th Cir. 1997) (noting 18 an adverse employment reference can be a violation of Title VII). However, the fact 19 that Title VII retaliation claims can be based on post-employment conduct does not 20 mean the same is true for Sarbanes–Oxley and Dodd–Frank claims. 21 Sarbanes–Oxley’s whistleblower retaliation provision provides a company 22 may not “discharge, demote, suspend, threaten, harass, or in any other manner 23 discriminate against an employee in the terms and conditions of employment because 24 of” protected activity. 18 U.S.C. § 1514A(a). As the statute indicates, the retaliation 25 that is actionable is “an unfavorable personnel action.” Tides v. The Boeing Co., 644 26
27 1 Erhart also brings a state law claim for wrongful discharge in violation of public policy. So far, like the parties, the Court has treated this claim as derivative of Erhart’s statutory 1 F.3d 809, 814 (9th Cir. 2011). By comparison, the Title VII anti-retaliation provision 2 says “it shall be an unlawful employment practice for an employer to discriminate 3 against any of his employees . . . [because] he has made [an EEOC] charge, testified, 4 assisted, or participated in any manner in an investigation, proceeding, or hearing 5 under this subchapter.” 42 U.S.C. § 2000e-3. So, Sarbanes–Oxley’s text is more 6 circumscribed than Title VII’s provision because it specifies the discrimination is “in 7 the terms and conditions of employment.” And Erhart does not point the Court to a 8 case allowing a Sarbanes–Oxley claim based on post-employment conduct. 9 The Dodd–Frank provision similarly provides no “employer may discharge, 10 demote, suspend, threaten, harass, directly or indirectly, or in any other manner 11 discriminate against, a whistleblower in the terms and conditions of employment 12 because of” protected activity. 15 U.S.C. § 78u-6(h)(1)(A). As the statute indicates, 13 the prohibited discrimination by an “employer” is in “the terms and conditions of 14 employment.” See id. 15 California’s general whistleblower statute says an employer “shall not retaliate 16 against an employee for” engaging in protected activity. Cal. Labor Code § 17 1102.5(b). A prerequisite to asserting a violation of the whistleblower statute is the 18 existence of an employer-employee relationship at the time the allegedly retaliatory 19 action occurred. Hansen v. Cal. Dep’t of Corr. & Rehab., 171 Cal. App. 4th 1537, 20 1546 (2008).
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1 2 3 4 5 6 7 8 9 UNITED STATES DISTRICT COURT 10 SOUTHERN DISTRICT OF CALIFORNIA
11 CHARLES MATTHEW ERHART, Case No. 15-cv-02287-BAS-NLS 12 consolidated with Plaintiff, 15-cv-02353-BAS-NLS 13 ORDER DENYING BOFI’S 14 v. MOTION IN LIMINE NO. 4 TO
15 BOFI HOLDING, INC., EXCLUDE EVIDENCE OF CONDUCT AND STATEMENTS 16 Defendant. THAT ARE NOT ACTIONABLE (ECF No. 220) 17 And Consolidated Case 18 19 20 Presently before the Court is BofI Holding, Inc.’s Motion in Limine No. 4 to 21 Exclude Evidence of Conduct and Statements that Are Not Actionable. (ECF No. 22 220.) Erhart opposes. (ECF No. 223.) The Court heard argument on the motion. 23 (ECF No. 230.) For the following reasons, the Court DENIES BofI’s Motion in 24 Limine No. 4. 25 I. BACKGROUND 26 The Court and the parties are familiar with the story behind these consolidated 27 cases awaiting trial. Erhart has whistleblower retaliation claims and a defamation 1 Erhart asserts that some of BofI’s retaliatory conduct occurred after his 2 employment ended on June 9, 2015. For example, in November 2015, the Bank’s 3 CEO allegedly told employees he was going to “bury the whistleblower.” (Katz Decl. 4 Ex. 4, at 361:4–18, ECF No. 220-6.) 5 As for Erhart’s defamation claim, he has identified various statements 6 throughout this case. For instance, Erhart claims that in mid-to-late 2014, Senior 7 Vice President Tolla called him “Seeking Alpha”—a reference to the investment blog 8 that had published negative articles about BofI. (Katz Decl. Ex. 3, at 248:21–249:3, 9 ECF No. 220-5.) This statement was made “in the bathroom” and not to anyone else. 10 (See id.) 11 BofI now brings a sweeping motion in limine with two goals. (ECF No. 220.) 12 First, the Bank seeks to exclude evidence of any post-termination conduct, arguing 13 this conduct is not relevant to Erhart’s whistleblower retaliation claims. (Id.) 14 Second, the Bank seeks an individualized determination that seven statements are not 15 actionable for Erhart’s defamation claim. 16 II. LEGAL STANDARD 17 A party may use a motion in limine to exclude inadmissible or excludable 18 evidence before it is introduced at trial. Luce v. United States, 469 U.S. 38, 40 n.2 19 (1984). Only relevant evidence is admissible. Fed. R. Evid. 402. Evidence is 20 relevant if it has any tendency to make a fact more or less probable than it would be 21 without the evidence, and the fact is of consequence in determining the action. Id. 22 401(a)–(b). 23 Relevant evidence may be excluded if its probative value is substantially 24 outweighed by, among other things, the danger of unfair prejudice or wasting 25 time. Fed. R. Evid. 403. The Rule 403 balancing inquiry is made on a case-by-case 26 basis, requiring an examination of the surrounding facts, circumstances, and 27 issues. United States v. Lloyd, 807 F.3d 1128, 1152 (9th Cir. 2015). 1 III. ANALYSIS 2 There are two complications with BofI’s fourth motion in limine. First, just 3 because post-termination conduct may not be actionable for Erhart’s whistleblower 4 retaliation claims does not mean it is irrelevant. As the Court highlighted at oral 5 argument, the question is whether the evidence is admissible because it shows that 6 something of consequence in the case is more likely than not. See Fed. R. Evid. 401. 7 To illustrate, the Court considers the CEO’s post-termination statement that he 8 is going to “bury the whistleblower.” The Court agrees that post-employment 9 conduct is not actionable for the retaliation element of Erhart’s claims. To recap, 10 these causes of action are retaliation claims under three statutes: Sarbanes–Oxley § 11 806, 18 U.S.C. § 1514A; Dodd–Frank § 21F, 15 U.S.C. § 78u-6; and California’s 12 general whistleblower statute, Cal. Labor Code § 1102.5(b).1 13 Erhart correctly argues that the law permits retaliation claims based on post- 14 employment conduct in a different context—Title VII. See Robinson v. Shell Oil Co., 15 519 U.S. 337 (1997) (concluding ambiguous term “employees” in Title VII includes 16 former employees, allowing them to bring a claim based on negative, retaliatory job 17 references); see also Hashimoto v. Dalton, 118 F.3d 671, 674 (9th Cir. 1997) (noting 18 an adverse employment reference can be a violation of Title VII). However, the fact 19 that Title VII retaliation claims can be based on post-employment conduct does not 20 mean the same is true for Sarbanes–Oxley and Dodd–Frank claims. 21 Sarbanes–Oxley’s whistleblower retaliation provision provides a company 22 may not “discharge, demote, suspend, threaten, harass, or in any other manner 23 discriminate against an employee in the terms and conditions of employment because 24 of” protected activity. 18 U.S.C. § 1514A(a). As the statute indicates, the retaliation 25 that is actionable is “an unfavorable personnel action.” Tides v. The Boeing Co., 644 26
27 1 Erhart also brings a state law claim for wrongful discharge in violation of public policy. So far, like the parties, the Court has treated this claim as derivative of Erhart’s statutory 1 F.3d 809, 814 (9th Cir. 2011). By comparison, the Title VII anti-retaliation provision 2 says “it shall be an unlawful employment practice for an employer to discriminate 3 against any of his employees . . . [because] he has made [an EEOC] charge, testified, 4 assisted, or participated in any manner in an investigation, proceeding, or hearing 5 under this subchapter.” 42 U.S.C. § 2000e-3. So, Sarbanes–Oxley’s text is more 6 circumscribed than Title VII’s provision because it specifies the discrimination is “in 7 the terms and conditions of employment.” And Erhart does not point the Court to a 8 case allowing a Sarbanes–Oxley claim based on post-employment conduct. 9 The Dodd–Frank provision similarly provides no “employer may discharge, 10 demote, suspend, threaten, harass, directly or indirectly, or in any other manner 11 discriminate against, a whistleblower in the terms and conditions of employment 12 because of” protected activity. 15 U.S.C. § 78u-6(h)(1)(A). As the statute indicates, 13 the prohibited discrimination by an “employer” is in “the terms and conditions of 14 employment.” See id. 15 California’s general whistleblower statute says an employer “shall not retaliate 16 against an employee for” engaging in protected activity. Cal. Labor Code § 17 1102.5(b). A prerequisite to asserting a violation of the whistleblower statute is the 18 existence of an employer-employee relationship at the time the allegedly retaliatory 19 action occurred. Hansen v. Cal. Dep’t of Corr. & Rehab., 171 Cal. App. 4th 1537, 20 1546 (2008). Hence, in Hansen, where “the alleged retaliation took place after [the 21 plaintiff] retired,” an “employee-employer relationship did not exist,” and the 22 employee could “not state a cause of action under Labor Code section 1102.5.” Id.; 23 see also Retaliation Under Whistleblower Statutes, Cal. Prac. Guide Employment 24 Litigation Ch. 5(II)-B (2020) (“No action lies under [the California statute] for 25 alleged retaliatory conduct (e.g., defamation) after termination of employment.”). 26 Accordingly, the Bank’s CEO’s post-termination statement to employees that 27 he was going to “bury the whistleblower” does not support the retaliation element of 1 [Erhart’s] employment.” See 18 U.S.C. § 1514A; 15 U.S.C. § 78u-6(h)(1)(A). 2 However, the statement has the “tendency to make a fact more or less probable than 3 it would be without the evidence”—namely, whether the Bank’s purported 4 constructive discharge of Erhart was in retaliation for protected conduct, as opposed 5 to Erhart “abandoning his job” or not completing his work. And BofI’s intent is a 6 fact “of consequence in determining” Erhart’s whistleblower retaliation claims. 7 Therefore, it would not be appropriate to exclude this post-termination conduct. 8 As a similar example, the Court addresses BofI’s argument that SVP Tolla’s 9 statement that Erhart “is Seeking Alpha” cannot support a defamation claim because 10 it was not published to other individuals. Even if that is correct, this statement, which 11 occurred while Erhart was employed, supports his claim that he was being retaliated 12 against for speaking up about conduct at the Bank. Hence, excluding this statement 13 altogether is likewise not warranted. 14 The second complication is that the Bank’s motion in limine is in truth a 15 motion for summary judgment. Motions in limine may not be used as a disguise for 16 a motion for summary judgment. Elliott v. Versa CIC, L.P., 349 F. Supp. 3d 1000, 17 1002 (S.D. Cal. 2018) (collecting cases); see also Petty v. Metro Gov. of Nashville & 18 Davidson Cnty., 687 F3d 710, 720–21 (6th Cir. 2012); Meyer Intell. Props. Ltd. v. 19 Bodum, Inc., 690 F.3d 1354, 1377 (Fed. Cir. 2012). “A motion in limine is not a 20 proper vehicle for a party to ask the Court to weigh the sufficiency of the evidence to 21 support a particular claim or defense, because that is the function of a motion 22 for summary judgment, with its accompanying and crucial procedural safeguards.” 23 Elliot, 349 F. Supp. 3d at 1002. 24 By asking the Court to exclude certain evidence because it is not actionable 25 for specific claims, BofI is seeking a determination that it is entitled to judgment as 26 a matter of law on “part of each claim” or for specific issues. See Fed. R. Civ. P. 27 56(a), (g); see also Nat’l Union Fire Ins. Co. of Pittsburgh, PA v. Ready Pac Foods, 1 ||Procedure, Rule 56(g), partial summary judgment or summary adjudication is 2 ||appropriate as to specific issues if it will narrow the issues for trial.”). A motion in 3 || limine, particularly one as broad as this motion, is not the correct device to summarily 4 || adjudicate these issues. 5 Accordingly, the Court denies Bofl’s request to slice-and-dice Erhart’s 6 ||retaliation and defamation claims. This ruling is without prejudice to Bofl raising 7 ||Rule 402 and 403 objections at trial, as well as advancing legal arguments through a 8 ||Rule 50(a) motion. 9 ||IV. CONCLUSION 10 For the foregoing reasons, the Court DENIES Bofl’s Motion in Limine No. 4 11 to Exclude Evidence of Conduct and Statements That Are Not Actionable. (ECF No. 12 220.) 13 IT IS SO ORDERED. 14 ) 15 || DATED: January 12, 2022 asf rd A 5 Hipha. 6 16 United States District Judge 17 18 19 20 21 22 23 24 25 26 27 28