1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 APARNA VASHISHT-ROTA, Case No.: 3:20-cv-00967-RBM-KSC
12 Plaintiff, ORDER: 13 v. (1) GRANTING IN PART AND 14 HARRISBURG UNIVERSITY, DENYING IN PART DEFENDANT’S 15 Defendant. MOTION TO DISMISS PLAINTIFF’S SECOND AMENDED 16 COMPLAINT (Doc. 63); and 17 (2) GRANTING IN PART AND 18 DENYING IN PART DEFENDANT’S 19 REQUEST FOR JUDICIAL NOTICE (Doc. 64) 20
21 [Docs. 63, 64]
22 On March 17, 2021, Defendant Harrisburg University (“Defendant” or 23 “Harrisburg”) filed a motion to dismiss Plaintiff’s second amended complaint (Docs. 49, 24 62) (“SAC”) pursuant to Federal Rule of Civil Procedure 12(b)(6) (“Motion to Dismiss”), 25 along with a request for judicial notice (“RJN”) regarding Department of Fair Employment 26 and Housing (“DFEH”) right-to-sue letters and related correspondence. (Docs. 63-64.) 27 Plaintiff Aparna Vashisht-Rota (“Plaintiff” or “Vashisht-Rota”), appearing pro se, filed an 28 1 opposition to the Motion to Dismiss on June 2, 2021. (Doc. 67.) Defendant filed a reply 2 on June 23, 2021. (Doc. 68.) 3 For the reasons below, Defendant’s Motion to Dismiss is GRANTED IN PART 4 and DENIED IN PART and Defendant’s Request for Judicial Notice is GRANTED IN 5 PART and DENIED IN PART. 6 I. BACKGROUND 7 This is the third iteration of Plaintiff’s complaint. Plaintiff filed her initial complaint 8 (Doc. 1) on May 26, 2020, and then a superseding first amended complaint (“FAC”) on 9 June 15, 2020 (Doc. 7). Defendant filed a motion to dismiss the FAC, and Plaintiff 10 subsequently filed a motion for leave to file a SAC. (See Docs. 11, 49.) The Court granted 11 Plaintiff leave to file a SAC and therefore denied Defendant’s motion to dismiss the FAC 12 as moot. (Doc. 61.) The facts from the SAC are taken as true for purposes of the Motion 13 to Dismiss and are outlined below. 14 Defendant provides a curricular practical training1 (“CPT”) program, which allows 15 foreign students to obtain work authorization at the university level while awaiting work 16 visas. (See SAC at 3-4.) Plaintiff alleges Defendant is in a principal/agent relationship 17 with “Main Agent,” who is Defendant’s “sole vendor” that handles international student 18 recruitment. (See SAC at 4-5, 8.) “Main Agent” is Plaintiff’s alleged former employer 19 that subjected Plaintiff to harassment, refused to pay Plaintiff for two years of work, and 20 acted as a restraint on her trade in placing foreign students at Harrisburg. (See SAC at 5, 21 13-14.) 22 In early to mid-2019, Plaintiff filed a grievance with Defendant, notifying Eric Darr, 23 President of Harrisburg, regarding “Defendant’s Main Agent’s harassment, nonpayment 24 25 26 1 Plaintiff does not define CPT in the SAC. However, the Court takes judicial notice of 27 related cases and understands this word to be an abbreviation for “curricular practical training.” See Vashisht-Rota v. Ottawa Univ., No. 20-cv-959-RBM-KSC, Doc. 48, ¶ 9 28 1 for work performed and the ongoing economic harm Plaintiff faces directly due to 2 Defendant and Main Agent’s conduct.” (Id. at 7.) Plaintiff also wrote Darr about Main 3 Agent’s “coercive tactics such as intimidation[] and bullying” and attempt to coerce an 4 incomprehensible agreement. (Id.) Plaintiff alleges “Darr simply forwarded the messages 5 to Plaintiff’s abuser of 4 years, the Main Agent, at that time and essentially coerced Plaintiff 6 to work with Main Agent or not at all by refusing to provide an alternative route.” (Id.) 7 Plaintiff alleges Main Agent required her to follow “severely oppressive policies” 8 regarding approval of work and “was then fired for an alleged violation of an 9 incomprehensible agreement with the Main Agent.” (Id.) Plaintiff is now “unable to place 10 students with Defendant.” (Id.) 11 Plaintiff claims she has been harmed by Main Agent’s negligence, and Defendant is 12 vicariously liable for such negligence and its negligent failure to supervise Darr on how to 13 handle complaints regarding protected activity. (Id.at 8.) Plaintiff also alleges Defendant 14 “retaliated against Plaintiff by taking adverse actions including creating a hostile 15 environment for reporting harassment,” aided and abetted in Main Agent’s harassment, 16 failed to correct Main Agent’s harassment and discrimination, engaged in unlawful conduct 17 acting as a restraint on her trade, and discriminated against her. (See generally SAC.) 18 A. Claims in SAC 19 Plaintiff, representing herself pro se, asserts the following causes of action in the 20 operative SAC: (1) negligence—vicarious liability; (2) retaliation for opposing harassment 21 and discrimination in violation of the Fair Employment and Housing Act (“FEHA”), Cal. 22 Gov. Code § 12940 (h); (3) aiding and abetting harassment in violation of FEHA; (4) failure 23 to correct harassment in violation of FEHA; (5) unfair business practice in violation of Cal. 24 Bus. & Prof. §§ 17200 et seq. (“UCL”); (6) prohibited restraints on trade in violation of 25 Cal. Bus. & Prof. § 16720 (“Cartwright Act”); (7) violation of Cal. Civ. Code § 51 et seq. 26 and FEHA § 12948; (8) violation of Civil Code § 51.5; and (9) failure to prevent 27 discrimination in violation of Civil Code § 51. (See generally SAC.) 28 / / / 1 B. Prior & Pending Related Cases in this District 2 Vashisht-Rota, representing herself pro se, has filed several other related cases in 3 this District, four of which are before the undersigned where she is appearing pro se. See 4 Vashisht-Rota v. Howell Management Services, No. 3:20-cv-00321-RBM-KSC;2 Vashisht- 5 Rota v. Ottawa Univ., No. 3:20-cv-00959-RBM-KSC; Vashisht-Rota v. Bluechip Servs., 6 No. 3:22-cv-00900-RBM-KSC; and Vashisht-Rota v. Utah Attorney General, No. 3:22-cv- 7 00978. Plaintiff, through counsel, filed two other lawsuits against Howell Management 8 Services (“HMS”) which were dismissed at the pleading stage due to the claims arising 9 from the same transaction or occurrence as claims pending in Utah state court litigated 10 between the parties. See generally Rota v. Howell Management Services, et. al., No. 3:18- 11 cv-02010-L-AGS; Rota v. Howell Management Services, LLC, No. 3:19-cv-00512-L- 12 MDD. 13 II. DISCUSSION 14 A. Request for Judicial Notice 15 In support of its Motion to Dismiss, Defendant requests the Court consider 16 documents not attached to the SAC. Defendant contends the Court may consider these 17 documents via the incorporation by reference doctrine, or alternatively, via judicial 18 notice. (See Doc. 63-1 at 12-13; Doc. 64-1 at 3-4.) Specifically, Defendant asks the 19 Court to consider the following documents: 20 • A March 27, 2018 DFEH right-to-sue letter issued to Plaintiff relating to her 21 March 27, 2018 amended complaints of discrimination against HMS and 22 Harrisburg asserting claims of sexual harassment/hostile work environment, 23 gender discrimination, and retaliation. (Doc. 66-1, Ex. A.)3 24 25 2 This case is presently on appeal. 26 3 The Declaration of Diana Tokarsky alleges it attaches as Exhibit A the March 27, 2018 27 DFEH right-to-sue letters against HMS and Harrisburg. (Doc. 64-1 at ¶ 2, Ex. A.) However, the originally-produced Exhibit A only contained the March 27, 2018 DFEH 28 1 • March 28, 2018 email correspondence from Plaintiff to Darr providing copies of 2 her DFEH right-to-sue letters against HMS. (Doc. 64-3, Ex. B.) 3 • A March 28, 2018 DFEH right-to-sue letter issued to Plaintiff relating to her 4 March 28, 2018 amended complaint of discrimination against HMS asserting 5 claims of sexual harassment/hostile work environment, gender discrimination, 6 and retaliation. (Doc. 64-4, Ex. C.) 7 • A January 5, 2020 right-to-sue letter against Harrisburg asserting claims of 8 harassment and discrimination due to race, national origin, and sexual 9 harassment/hostile work environment. (Doc. 64-5, Ex. D.) 10 As a general rule, the court is limited to reviewing only the complaint when ruling 11 on a 12(b)(6) motion. Lee v. City of Los Angeles, 250 F.3d 668, 688 (9th Cir. 2011) 12 (quoting Cervantes v. City of San Diego, 5 F.3d 1273, 1274 (9th Cir. 1993)); see also U.S. 13 v. Corinthian Colleges, 655 F.3d 984, 998 (9th Cir. 2011). If a court considers documents 14 extraneous to the pleadings on a Rule 12(b)(6) motion, “the motion must be treated as one 15 for summary judgment under Rule 56.” FED. R. CIV. P. 12(d). However, “[t]here are two 16 exceptions to this rule: the incorporation-by-reference doctrine, and judicial notice under 17 Federal Rule of Evidence 201.” Khoja v. Orexigen Therapeutics, Inc., 899 F.3d 988, 998 18 (9th Cir. 2018). As to the incorporation-by-reference doctrine, when documents are not 19 physically attached to the complaint, they may be considered if: “(1) the complaint refers 20 to the document; and (2) the document is central to the plaintiff’s claim; and (3) no party 21 questions the authenticity of the document.” Corinthian Colleges, 655 F.3d at 998; see 22 also U.S. v. Ritchie, 342 F.3d 903, 908 (9th Cir. 2003) (“E]ven if a document is not attached 23 to a complaint, it may be incorporated by reference into a complaint if the plaintiff refers 24 extensively to the document or the document forms the basis of the plaintiff’s claim.”) 25 (citations omitted). “[U]nlike judicial notice, a court may assume [an incorporated 26 27 Errata which contains complete copies of Exhibit A attached to the RJN, including the 28 1 document’s] contents are true for purposes of a motion to dismiss ” but “it is improper to 2 assume the truth of an incorporated document if such assumptions only serve to dispute 3 facts stated in a well-pleaded complaint.” Khoja, 899 F.3d at 1003 (internal quotation 4 marks and citation omitted). 5 Pursuant to Federal Rule of Evidence Rule 201, a court may take judicial notice of 6 adjudicative facts that are “not subject to reasonable dispute” because they are either (1) 7 “generally known within the trial court’s territorial jurisdiction” or (2) “can be accurately 8 and readily determined from sources whose accuracy cannot reasonably be questioned.” 9 FED. R. EVID. 201(a), (b). Accordingly, “[a] court may take judicial notice of matters of 10 public record without converting a motion to dismiss into a motion for summary 11 judgment.” Khoja, 899 F.3d at 999 (quoting Lee, 250 F.3d at 689). “But a court cannot 12 take judicial notice of disputed facts contained in such public records.” Id. 13 Defendant contends these documents may be incorporated by reference and/or 14 judicially noticed because the SAC alleges Plaintiff “has exhausted her administrative 15 remedy requirements” and DFEH “has issued a Right To Sue Plaintiff . . . dated January 5, 16 2020.” (Doc. 63-1 at 13 (citing SAC ¶¶ 3-4).) Defendant also contends judicial notice is 17 appropriate because the SAC also alleges that “in early-mid 2019 . . . Plaintiff, a minority 18 woman, filed a grievance with Defendant. Specifically, Plaintiff notified [Darr] . . . of 19 Defendant’s Main Agent’s harassment, nonpayment for work performed and the ongoing 20 economic harm Plaintiff faces directly due to Main Agent’s conduct.” (Doc. 64-1 at 4 21 (citing SAC ¶¶ 20-21).) 22 Plaintiff’s response notes the Declaration in Support of Defendant’s Request for 23 Judicial Notice references that March 2018 right-to-sue letter against Harrisburg but it does 24 not attach that document as Exhibit A to the RJN. As stated above, Defendant attached a 25 complete version of Exhibit A in its subsequent notice of errata. See supra p. 4 n. 3. Other 26 than the foregoing, Plaintiff does not appear to contest the authenticity of the right-to-sue 27 letters or email correspondence to Darr, nor does she oppose the RJN. (See Doc. 67 at 5.) 28 As to the January 2020 DFEH right-to-sue letter, the SAC explicitly refers to this 1 document. (SAC at ¶¶ 3-4.) Additionally, this letter is central to Plaintiff’s claims as 2 exhaustion of administrative remedies is a requirement for Plaintiff’s FEHA claims. 3 Valdez v. City of Los Angeles, 282 Cal. Rptr. 726, 736 (Cal. Ct. App. 1991). Finally, 4 Plaintiff does not appear to contest the authenticity of the document. As such, the January 5 2020 right-to-sue letter may be incorporated by reference into the SAC. Corinthian 6 Colleges, 655 F.3d at 998; see also Ritchie, 342 F.3d at 908. The March 27, 2018 and 7 March 28, 2018 DFEH right-to-sue letters, on the other hand, are not explicitly referenced 8 in the SAC. While Defendant contends Plaintiff intentionally omitted these letters to avoid 9 any claims being barred by the statute of limitations, the Court is not inclined to question 10 Plaintiff’s motive for omitting these letters at the motion to dismiss stage. (Doc. 63-1 at 11 13.) Since the SAC is devoid of any facts relating to right-to-sue letters, grievances, or 12 reports of grievances in March 2018, the Court cannot find that the March 2018 letters are 13 central to Plaintiff’s claims. As such, the March 2018 right-to-sue letters cannot be 14 incorporated by referenced into the SAC. However, right-to-sue letters are proper subjects 15 of a request for judicial notice, as the accuracy of DFEH right-to-sue letters and complaints 16 cannot reasonably be questioned. Wagner v. Wal-Mart Stores, Inc., No. 13-cv-3475, 2013 17 WL 5645169, *1 n.1 (N.D. Cal. Oct. 16, 2013); Hugo Contreras v. Castro Valley Unified 18 Sch. Distr., No. 06-4169, 2007 WL 9810949, *1 n.1 (N.D. Cal. Feb. 26, 2007). 19 Accordingly, the Court GRANTS Plaintiff’s request for judicial notice of all of the right- 20 to-sue letters and GRANTS Plaintiff’s request for the January 5, 2020 right-to-sue letter 21 be incorporated by reference into the SAC. 22 As to the March 28, 2018 email correspondence from Plaintiff to Darr providing 23 copies of her DFEH right-to-sue letters against HMS, the SAC does not explicitly reference 24 this correspondence. While the SAC alleges Plaintiff notified Darr of Main Agent’s 25 conduct and the filing of a grievance with Defendant, it alleges this occurred in “early-mid 26 2019,” not 2018. (See SAC ¶ 20.) Given the date discrepancy between the email 27 correspondence and the SAC, a dispute exists as to whether this document forms the basis 28 of Plaintiff’s claims. As such, this document cannot be incorporated by reference into the 1 SAC. Moreover, the truth of any facts contained within email correspondence is not within 2 the category of documents whose authenticity cannot reasonably be questioned. See 3 Stamas v. Cty. of Madera, No. cv-F 09-0753 LJO-SMS, 2010 WL 1416866, *4 (E.D. Cal. 4 Apr. 8, 2010) (declining to take judicial notice of email correspondence because they are 5 not facts generally known to the public and are not capable of accurate and ready 6 determination). Accordingly, the Court DENIES Plaintiff’s request for judicial notice of 7 the March 28, 2018 email correspondence. 8 B. Motion to Dismiss 9 Defendant seeks dismissal of the SAC on three separate grounds, including: (1) all 10 claims are time barred by the statute of limitations; (2) the UCL and Cartwright Act claims 11 fail as a matter of law because the parties have no business relationship; and (3) the “failure 12 to correct” harassment claim fails as a matter of law because Harrisburg never employed 13 Plaintiff, there has been no predicate finding of harassment, and Plaintiff failed to exhaust 14 her administrative remedies. (Doc. 63-1 at 32.) 15 i. Legal Standard 16 Under Federal Rule of Civil Procedure (“Rule”) 12(b)(6), a party may move to 17 dismiss a complaint for “failure to state a claim upon which relief can be granted.” FED. 18 R. CIV. P. 12(b)(6). At the motion to dismiss stage, all material factual allegations in the 19 complaint are accepted as true and are construed in the light most favorable to the non- 20 moving party. Cahill v. Liberty Mut. Ins. Co., 80 F.3d 336, 337–38 (9th Cir. 1996). “A 21 complaint should not be dismissed unless a plaintiff can prove no set of facts in support of 22 his claim which would entitle him to relief.” Id. (citation omitted). 23 To avoid dismissal under Rule 12(b)(6), a complaint need not contain detailed 24 factual allegations; rather, the plaintiff must plead “enough facts to state a claim to relief 25 that is plausible on its face.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). 26 “A claim has facial plausibility when the plaintiff pleads factual content that allows the 27 court to draw the reasonable inference that the defendant is liable for the misconduct 28 alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing Twombly, 550 U.S. at 556). 1 In other words, “the non-conclusory ‘factual content,’ and reasonable inferences from that 2 content, must be plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v. 3 U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009) (citing Iqbal, 556 U.S. at 678). “Where 4 a complaint pleads facts that are ‘merely consistent with’ a defendant’s liability, it ‘stops 5 short of the line between possibility and plausibility of entitlement to relief.’” Id. (quoting 6 Twombly, 550 U.S. at 557). 7 When a Rule 12(b)(6) motion is granted, “a district court should grant leave to amend 8 even if no request to amend the pleading was made, unless it determines that the pleading 9 could not possibly be cured by the allegation of other facts.” Cook, Perkiss & Liehe v. N. 10 Cal. Collection Serv., 911 F.2d 242, 247 (9th Cir. 1990) (citations omitted). 11 ii. Timeliness of Plaintiff’s Claims 12 Defendant contends Plaintiff’s own allegations prove her claims are time-barred 13 because they are predicated upon the SAC’s alleged discriminatory activity that occurred 14 when “Plaintiff worked with the Defendant’s Main Agent between March 2015 and March 15 2017.” (See Doc. 63-1 at 7, 9-10, 12, 14-15; see also SAC ¶ 16.) Defendant argues Plaintiff 16 is attempting to “extend her statute of limitations for harassment and discrimination that 17 occurred in 2017, by filing a new FEHA complaint in 2020 and ignoring the 2018 FEHA 18 complaint and right to sue arising from the same alleged activity.” (Doc. 63-1 at 13.) 19 Defendant contends the statute of limitations for Plaintiff to raise any complaints with any 20 purported employer would have run in 2018, since her employment ended in March 2017.4 21
22 23 4 Defendant cites May 6, 2017 as the date Plaintiff ended her employment with the Main Agent because this is what Plaintiff alleged in her Amended Complaint filed on June 15, 24 2020. (See Doc. 63-1 at 8 n. 4 (citing Doc. 7 ¶¶ 24-26).) Defendant also contends the 25 March 28, 2018 right-to-sue letter against HMS cites May 6, 2017 as the end date of Plaintiff’s employment. The Court declines to use May 6, 2017 as Plaintiff’s end date of 26 employment for two reasons. First, the Court must construe all well-pleaded allegations in 27 the superseding SAC as true, and the SAC alleges Plaintiff ended employment with the Main Agent in March 2017. See Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 28 1 Defendant alternatively argues the statute of limitations would have expired March 27, 2 2019, one year after Plaintiff “forwarded the DFEH’s March 28, 2018 right to sue letter 3 against [Harrisburg] to President Darr” or March 26, 2019, one year from the date of the 4 March 27, 2018 right-to-sue letter. (Doc. 63-1 at 14-15.) 5 A statute of limitations defense may be raised by a motion to dismiss “[i]f the 6 running of the statute is apparent on the face of the complaint.” Jablon v. Dean Witter & 7 Co., 614 F.2d 677, 682 (9th Cir. 1980). Such a motion “can be granted only if the assertions 8 of the complaint, read with the required liberality, would not permit the plaintiff to prove 9 that the statute was tolled.” Id. Where the statute of limitations question turns on factual 10 issues that may be disputed, the question is more appropriately addressed at a later stage 11 of the proceeding. See Barnett v. Kapla, No. 20-cv-03748-JCS, 2020 WL 6737381, *5 12 (N.D. Cal. Sept. 28, 2020) (citing Jablon, 614 F.2d at 682.) 13 The act that forms of the basis of the SAC is not focused on Plaintiff’s March 2017 14 end date of employment with Main Agent or the March 2018 right-to-sue letter. Rather, it 15 is focused on Plaintiff filing a grievance with Defendant in “early-mid 2019” regarding 16 Main Agent’s alleged harassment and nonpayment for work performed and Defendant 17 “essentially coerc[ing] Plaintiff to work with the Main Agent or not at all by refusing to 18 provide an alternative route.” (SAC ¶¶ 20, 21.) The SAC is also premised upon the January 19 5, 2020 right-to-sue letter against Defendant. (SAC ¶ 4.) Because a factual dispute exists 20 as to the timeliness of the entirety of Plaintiff’s complaint, the Court DENIES Defendant’s 21 motion to dismiss all claims on statute of limitations grounds. 22 23 1008 (9th Cir. 2015) (in the Ninth Circuit, “an amended complaint supersedes the original, 24 the latter being treated thereafter as non-existent.”) (citation omitted). Second, although 25 the judicially noticed March 28, 2018 right-to-sue letter alleges Plaintiff ended employment with HMS on May 6, 2017, the “court cannot take judicial notice of disputed 26 facts contained in such public records.” Khoja, 899 F.3d at 999 (citing Lee, 250 F.3d at 27 689) (emphasis added). Thus, any time Defendant references an end date of employment, the Court will apply the March 2017 end date as contained within the SAC. (See SAC ¶ 28 1 a. FEHA Claims (Second, Third, Fourth, Seventh, Eighth, and Ninth 2 Causes of Action) and UCL & Cartwright Act Claims (Fifth and 3 Sixth Causes of Action) 4 Defendant contends all FEHA causes of action are time barred because “Plaintiff 5 failed to bring this action within one year of the date of the [March 2018] Right to Sue 6 Letter against [Defendant].” (Doc. 63-1 at 15.) Defendant contends Plaintiff’s UCL and 7 Cartwright Act claims are derivative of the FEHA claims and fail for the same reasons. 8 (Id. at 16.) Defendant also makes a statute of limitations argument based upon Plaintiff’s 9 March 2018 email correspondence with Darr, however, the Court will not address this 10 argument as it declines to take judicial notice of such correspondence. See supra Section 11 II(A). In any event, as discussed in Section II(B)(ii), supra, a factual dispute exists as to 12 the timeliness of Plaintiff’s FEHA, UCL, and Cartwright Act claims because the SAC is 13 premised upon the January 2020 right-to-sue letter and report of a grievance to Defendant 14 in “early-mid 2019.” Accordingly, the Court DENIES Defendant’s motion to dismiss 15 Plaintiff’s FEHA, UCL, and Cartwright Act claims on statute of limitations grounds. 16 b. First Cause of Action—Negligence (Vicarious Liability) 17 Defendant interprets the negligence claim as one arising from an alleged tortious 18 discharge from employment in violation of public policy. (Doc. 63-1 at 17.) In light of 19 the same, Defendant centers its argument on Plaintiff’s March 20175 termination from the 20 Main Agent’s employment and contends the claim is barred by California’s two-year 21 personal injury statute of limitations. (Id. (citing CAL. CIV. CODE § 335.1).) 22 In liberally construing the SAC, the negligence claim appears to be based on 23 allegations broader than tortious discharge from employment as it includes claims that 24 Defendant failed to supervise Darr on how to properly handle grievances. (SAC ¶¶ 27-28.) 25 The SAC alleges Darr’s mishandling of Plaintiff’s grievance occurred in “early-mid 2019.” 26 27 5 Any time Defendant references a May 2017 end date of employment, the Court will apply 28 1 (See SAC ¶ 20.) Because Plaintiff filed her complaint on March 17, 2021, the claim is not 2 barred by the two-year statute of limitations. Accordingly, the Court DENIES Defendant’s 3 motion to dismiss Plaintiff’s negligence claim on statute of limitations grounds. 4 iii. Fifth and Sixth Causes of Action—UCL & Cartwright Act Claims 5 a. UCL Claim (Fifth Cause of Action) 6 As to the UCL claim, Defendant contends it should be dismissed as a matter of law 7 due to a lack of any employment or business relationship between the parties. (Doc. 63-1 8 at 19-20.) 9 California’s UCL prohibits unfair competition by means of any unlawful, unfair or 10 fraudulent business practice. CAL. BUS. & PROF. CODE §§ 17200 et seq. “Because the 11 statute is written in the disjunctive, it is violated where a defendant’s act or practice violates 12 any of the foregoing prongs.” Davis v. HSBC Bank Nevada, N.A., 691 F.3d 1152, 1168 13 (9th Cir. 2012) (internal citation omitted). The scope of the UCL is “sweeping, embracing 14 anything that can be properly called a business practice and that at the same time is 15 forbidden by law.” Cel-Tech Comms., Inc. v. L.A. Cellular Tel. Co., 973 P.2d 527, 560 16 (Cal. 1999) (internal quotation marks and citations omitted). Plaintiff appears to proceed 17 under the “unlawful” prong of the UCL, where her UCL claims are derivative to her other 18 causes of action for retaliation for opposing harassment, aiding and abetting Main Agent’s 19 harassment, and failing to prevent harassment. (SAC ¶¶ 58-63.) 20 Defendant has not satisfied its burden of proving dismissal is appropriate at this stage 21 of litigation because Plaintiff’s derivative claims for retaliation for opposing harassment 22 and aiding and abetting harassment have survived the instant 12(b)(6) motion. Moreover, 23 Defendant cites no authority for the proposition that an employment relationship is required 24 to assert a UCL claim, and it likewise fails to provide any analysis as to how its conduct 25 cannot fall within the broad scope of a “business practice” as defined under the UCL. See 26 Cel-Tech Comms., Inc., 973 P.2d at 560. Accordingly, the Court DENIES Defendant’s 27 motion to dismiss Plaintiff’s UCL claim. 28 / / / 1 b. Cartwright Act Claim (Sixth Cause of Action) 2 Defendant seeks dismissal of Plaintiff’s Cartwright Act claim for the same reasons 3 it seeks dismissal of the UCL claim. (Doc. 63-1 at 19-20.) 4 A cause of action for a conspiracy in restraint of trade in violation of the Cartwright 5 Act “must allege (1) the formation and operation of the conspiracy, (2) the wrongful act or 6 acts done pursuant thereto, and (3) the damage resulting from such act or acts . . . . General 7 allegations of agreement have been held sufficient . . . providing the unlawful acts or civil 8 wrongs are otherwise sufficiently alleged.” Kunert v. Mission Fin. Servs. Corp., 1 Cal. 9 Rptr. 3d 589 n.15 (Cal. Ct. App. 2003) (internal quotation omitted). The pleading of 10 Cartwright Act violations “demands a high degree of particularity.” Starlight Cinemas v. 11 Regal Ent. Grp., No. CV 14-5463-R, 2014 WL 7781018, *1 (C.D. Cal. Oct. 23, 2014), 12 aff’d, 691 F. App’x 404 (9th Cir. 2017) (internal citation omitted). “General allegations of 13 a conspiracy unaccompanied by a statement of facts constituting the conspiracy and 14 explaining its objectives and impact in restraint of trade will not suffice.” Id. When 15 pleading an antitrust violation, allegations must be enough to raise a right to relief about 16 the speculative level. Id. (citing Twombly, 550 U.S. at 553). “The complaint must allege 17 facts such as a specific time, place, or person involved in the alleged conspiracies to give 18 a defendant seeking to respond to allegations of a conspiracy an idea of where to begin.” 19 Id. (citation omitted). 20 As to element one, the SAC merely contains a conclusory allegation that Defendant 21 and Main Agent “agreed to boycott Plaintiff with the purpose to restraint competition and 22 to ‘block her.’” (SAC ¶ 64.) The SAC offers no details as to a specific time, place, or 23 person involved in how Defendant allegedly “agreed to boycott Plaintiff.” The SAC 24 therefore insufficiently shows the formation and operation of a conspiracy. Accordingly, 25 the Court GRANTS Defendant’s motion to dismiss Plaintiff’s Cartwright Act claim. 26 iv. Fourth Cause of Action—Failure to Correct Harassment 27 Defendant contends Plaintiff’s claim for failure to correct harassment should be 28 dismissed due to lack of an employment relationship, Plaintiff’s failure to prove any 1 underlying harassment and/or retaliation, and Plaintiff’s failure to exhaust administrative 2 remedies. (Doc. 63-1 at 20-22.) 3 California Government Code § 12940(k) makes it unlawful for an employer “to fail 4 to take all reasonable steps necessary to prevent discrimination and harassment from 5 occurring.” CAL. GOV. CODE § 12940(k). To state claim for failure to prevent harassment, 6 a plaintiff must show: “(1) plaintiff was subjected to discrimination, harassment, or 7 retaliation; (2) defendant failed to take all reasonable steps to prevent discrimination, 8 harassment or retaliation; and (3) this failure caused plaintiff to suffer injury, loss or harm.” 9 Andrade v. Arby’s Rest. Grp., Inc., 225 F. Supp. 3d 1115, 1131 (N.D. Cal. 2016) (internal 10 citation and quotations omitted). Importantly, “[a] plaintiff cannot state a claim for failure 11 to prevent harassment unless the plaintiff first states a claim for harassment.” M.F. v. Pac. 12 Pearl Hotel Mgmt LLC, 224 Cal. Rptr. 542, 548 (Cal. Ct. App. 2017) (internal citations 13 omitted). As to an underlying claim for harassment, an independent contractor is covered 14 by the provision of FEHA prohibiting harassment of a “person providing services pursuant 15 to a contract.” Jacobson v. Schwarzenegger, 357 F. Supp. 2d 1198, 1213-14 (C.D. Cal. 16 2004) (citing CAL. GOV. CODE § 12940(j)(1)). 17 Defendant focuses on the lack of an employment relationship between Harrisburg 18 and Plaintiff in seeking dismissal of the failure to prevent harassment claim. It is true that 19 the SAC does not allege an employment relationship exists between Defendant and 20 Plaintiff. Nor does the SAC adequately plead facts relating to the existence of an 21 independent contractor relationship between Plaintiff and Defendant. Instead, the SAC 22 alleges “Defendant has a sole vendor (‘Main Agent’) handle the entire recruitment for 23 international students.” (SAC ¶ 12.) Plaintiff further alleges: 24 [i]t is industry practice that the Main Agent follows all of Defendant’s policies[.] ‘Industry standards’ are included in contracts between universities and their agents . 25 . . . Contracts are the foundation of such partnerships and usually stipulate that any 26 third-party relationships that arise are also bound by their terms. Industry standards and norms, included in such contracts, apply to all actors within their scope- 27 institutions, agents and any third parties. For instance, the agreements negotiated 28 between the Plaintiff and the Main Agent state that ‘the representative is authorized 1 to counsel and inform prospective clients solely in accordance with the published promises and commitments made by Main Agent and its partner colleges and 2 universities.’ That is, the terms of the agreements negotiated between the Main 3 Agent and its partner colleges and universities have a ‘trickle down’ effect and apply equally to any third parties that come within their purview. 4
5 (Id. ¶ 13.) It alleges Plaintiff was classified as Main Agent’s employee, “Plaintiff’s work 6 was for the Main Agent’s present and future universities of which Defendant is one[,]” and 7 “Main Agent was . . . Defendant’s agent when the incidents occurred.” (Id. ¶¶ 17, 23, 26.) 8 The SAC’s conclusory allegations of “industry practice” and “industry norms” are 9 insufficient to plead the existence of any employment or independent contractor 10 relationship between Plaintiff and Defendant. See Twombly, 550 U.S. at 557. Accordingly, 11 the Court GRANTS Defendant’s motion to dismiss Plaintiff’s failure to prevent 12 harassment claim. 13 v. Leave to Amend 14 Defendant argues leave to amend should be denied. (Doc. 63-1 at 22-23.) Citing 15 Plaintiff’s numerous attempts6 to amend her complaint, Defendant contends any further 16 amendment would be futile7 and in bad faith. (Id.) Plaintiff requests leave to amend her 17 complaint because she “is a new entrant to universities, CPT, international recruitment, 18 academic research, and the law.” (Doc. 67 at 6.) 19 When determining whether to grant leave to amend, courts generally consider five 20 factors, known as the Foman factors as stated by the Supreme Court in Foman v. Davis, 21 371 U.S. 178, 182 (1962). These factors include: (1) undue delay; (2) bad faith on the part 22 of the party seeking leave to amend; (3) undue prejudice to the non-moving party; (4) 23 futility of amendment; and (5) whether the plaintiff has previously amended the complaint. 24 25 26 6 Defendant contends this is Plaintiff’s fifth attempt to amend the complaint. However, as 27 outlined above, this is Plaintiff’s third iteration of the complaint. See supra Section I. 7 Defendant argues, in part, that amendment is futile on the basis that Plaintiff’s claims are 28 1 Id. The Ninth Circuit has held that “it is the consideration of prejudice to the opposing 2 party that carries the greatest weight.” Eminence Cap., LLC v. Aspeon, Inc., 316 F.3d 1048, 3 1052 (9th Cir. 2003). “Absent prejudice, or a strong showing of any of the remaining 4 Foman factors, there exists a presumption under Rule 15(a) in favor of granting leave to 5 amend.” Id. (emphasis omitted). In Parents for Privacy v. Barr, 949 F.3d 1210, 1239 (9th 6 Cir. 2020), the Ninth Circuit affirmed a district court’s denial of leave to amend on futility 7 grounds reasoning “[t]he problem with Plaintiffs’ complaint, however, is not the 8 sufficiency of their factual allegations” but “[r]ather . . . Plaintiffs’ legal theories fail.” Id. 9 There, “[a]mending the complaint [would] not change, for example, the extent of the rights 10 that are protected.” Id. 11 As stated above, this is the third iteration of Plaintiff’s complaint. Plaintiff filed her 12 initial complaint (Doc. 1) on May 26, 2020, and then a superseding FAC on June 15, 2020 13 (Doc. 7). The Court granted Plaintiff leave to file a SAC without ruling on Defendant’s 14 motion to dismiss the FAC. (Doc. 61.) Thus, the Court has not previously ruled on the 15 merits of any motion to dismiss, nor has it put Plaintiff on notice of any deficiencies in her 16 complaints in the instant case. While this case has been in the pleading stage since 2020, 17 some of this delay has been due to the transfer of this case to four different judges. (See 18 Docs. 25, 47, 70, 71.) Aside from concerns of litigation time and money, Defendant has 19 not shown it will suffer any prejudice from allowing Plaintiff an opportunity to amend. At 20 this juncture, the Court cannot conclude Plaintiff is seeking to amend the complaint in bad 21 faith as Defendant has not met its burden of proving the same. Finally, “a proposed 22 amendment is futile only if no set of facts can be proved under the amendment to the 23 pleadings that would constitute a valid and sufficient claim or defense.” Miller v. Rykoff- 24 Sexton, Inc., 845 F.2d 209, 214 (9th Cir. 1988) (citing Baker v. Pac. Far E. Lines, Inc., 451 25 F. Supp. 84, 89 (N.D. Cal. 1978)). For the reasons stated above, the Court DENIES 26 Defendant’s request that the Court deny Plaintiff leave to amend. 27 III. CONCLUSION 28 For the reasons discussed above: 1 1. Defendant’s Request for Judicial Notice (Doc. 64) is GRANTED IN PART 2 and DENIED IN PART. 3 2. Defendant’s Motion to Dismiss (Doc. 63) is GRANTED IN PART and 4 DENIED IN PART. 5 3. Plaintiff MAY FILE an amended complaint on or before twenty-one (21) 6 days from the electronic docketing of this order. 7 IT IS SO ORDERED. 8 ||DATE: January 4, 2023 Ce zit er mols Do aespy 9 HON. RUTH BERMUWDEZ MONTENEGRO UNITED STATES DISTRICT JUDGE 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 17