Bond v. Wells Fargo Bank NA

1 WO [5] 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA [8] 9 Jennifer Bond, No. CV-21-00830-PHX-JJT 10 Plaintiff, ORDER 11 v. 12 Wells Fargo Bank NA, 13 Defendant. [14] 15 At issue is Plaintiff’s Motion for Leave to File a Third Amended Complaint 16 (Doc. 51, Mot.), to which Defendant filed a Response (Doc. 59, Resp.) and Plaintiff filed 17 a Reply (Doc. 62, Reply). Also at issue are Plaintiff’s Motion for Leave to File a Fourth 18 Amended Complaint (Doc. 63) and Defendant’s Motion to Stay Deadline to Respond to 19 Plaintiff’s Motion for Leave to File a Fourth Amended Complaint (Doc. 65), to which 20 Plaintiff filed a Response (Doc. 68) and Defendant filed a Reply (Doc. 69). The Court finds 21 these matters appropriate for decision without oral argument. See LRCiv 7.2(f). 22 I. BACKGROUND 23 The Court recited the background facts of this case in its December 9, 2021 Order 24 (Doc. 20). In brief, Plaintiff Jennifer Bond alleges sex and age discrimination and 25 retaliation against Defendant Wells Fargo Bank NA, her current employer, under Title VII 26 and the Age Discrimination in Employment Act (“ADEA”). In ruling on Defendant’s first 27 motion to dismiss, filed July 2, 2021, the Court granted Plaintiff leave to amend the 28 Complaint to the extent Plaintiff could allege that undated discrete discriminatory acts in 1 her Complaint occurred on or after March 23, 2019; discrete acts occurring before that date 2 were time-barred. Plaintiff filed her First Amended Complaint on December 20, 2021. 3 (Doc. 24.) The Court entered a Scheduling Order on December 16, 2021. (Doc. 22.) 4 On January 20, 2022, Plaintiff filed a Motion for Leave to File a Second Amended 5 Complaint (“SAC”). (Doc. 31.) In an Order dated May 5, 2022 (Doc. 41), the Court granted 6 in part and denied in part Plaintiff’s request to amend, requiring her to remove allegations 7 from the proposed SAC concerning discriminatory and retaliatory evaluations and 8 performance improvement plans and a lost bonus/raise, because those allegations were not 9 presented in her Charge to the Equal Employment Opportunity Commission (“EEOC”) and 10 therefore not administratively exhausted. Plaintiff filed the SAC on May 20, 2022 11 (Doc. 42), and it is presently the operative pleading in this case. 12 After Defendant filed a motion to dismiss the SAC on June 24, 2022 (Doc. 49), the 13 parties informed the Court (Doc. 50) that Plaintiff had received a new right to sue letter 14 from the EEOC based on new allegations against Defendant. The parties thus jointly asked 15 the Court to strike the pending motion to dismiss the SAC and vacate the Scheduling Order 16 pending a new operative complaint and answer, which the Court did (Doc. 52). Plaintiff 17 filed a Motion for Leave to File a Third Amended Complaint (“TAC”) on July 12, 2022 18 (Doc. 51), now pending before the Court. 19 On October 28, 2022, Plaintiff filed a Motion for Leave to File a Fourth Amended 20 Complaint in which she informed the Court that she received yet another right to sue letter 21 from the EEOC. (Doc. 63.) Instead of responding to that Motion, Defendant filed a Motion 22 (Doc. 65) to stay its response pending the Court’s ruling on Plaintiff’s earlier-filed Motion 23 for Leave to File a TAC. 24 II. LEGAL STANDARD 25 A party may amend a pleading once as a matter of course within 21 days after 26 serving it, or within 21 days of service of, inter alia, a Rule 12(b)(6) motion. Fed. R. Civ. 27 P. 15 (a). In all other circumstances, absent the opposing party’s written consent, a party 28 must seek leave to amend from the court. Fed. R. Civ. P. 15(a)(2). Although the decision 1 to grant or deny a motion to amend is within the trial court's discretion, “Rule 15(a) declares 2 that leave to amend shall be freely given when justice so requires.” Foman v. Davis, 371 3 U.S. 178, 182 (1962) (citation and internal quotation marks omitted). “In exercising its 4 discretion with regard to the amendment of pleadings, a court must be guided by the 5 underlying purpose of Rule 15—to facilitate a decision on the merits rather than on the 6 pleadings or technicalities.” Eldridge v. Block, 832 F.2d 1132, 1135 (9th Cir. 1987) 7 (citation and internal quotation marks omitted). The policy of Rule 15 “should be applied 8 with extreme liberality.” Desertrain v. City of Los Angeles, 754 F.3d 1147, 1154 (9th Cir. 9 2014) (citation and internal quotation marks omitted). 10 However, the policy in favor of allowing amendments is subject to limitations. After 11 a defendant files a responsive pleading, the court considers whether the complaint was 12 previously amended, Johnson v. Buckley, 356 F.3d 1067, 1077 (9th Cir. 2004), or if an 13 amendment “would cause prejudice to the opposing party, is sought in bad faith, is futile, 14 or creates undue delay.” Madeja v. Olympic Packers, 310 F.3d 628 , 636 (9th Cir. 2002) 15 (citation and internal quotation marks omitted). “Futility alone can justify the denial of a 16 motion for leave to amend.” Nunes v. Ashcroft, 375 F.3d 805, 808 (9th Cir. 2003). 17 “A proposed amended complaint is futile if it would be immediately subject to 18 dismissal. Thus, the proper test to be applied when determining the legal sufficiency of a 19 proposed amendment is identical to the one used when considering the sufficiency of a 20 pleading challenged under Rule 12(b)(6).” Nordyke v. King, 644 F.3d 776 , 788 n.12 (9th 21 Cir. 2011) (quotations and citations omitted), aff’d on reh’g en banc on other grounds, 681 22 F.3d 1041 (9th Cir. 2012). To survive a Rule 12(b)(6) motion, a complaint must allege 23 “enough facts to state a claim to relief that is plausible on its face.” Bell Atlantic Corp. v. 24 Twombly, 550 U.S. 544, 570 (2007). A dismissal for failure to state a claim can be based 25 on either (1) the lack of a cognizable legal theory or (2) insufficient facts to support a 26 cognizable legal claim. Balistreri v. Pacifica Police Dep’t, 901 F.2d 696, 699 (9th Cir. 27 1990). [28] 1 III. ANALYSIS 2 A. Motion for Leave to File a TAC 3 Defendant argues that certain allegations in the Proposed TAC (Doc. 51-3, Proposed 4 TAC) are futile, and the Court will examine them in turn. (See Resp. at 4-12.) 5 1. Paragraph 42(D)—Plaintiff’s Withdrawn Applications 6 In the Proposed TAC, Plaintiff clarifies prior versions of the complaint by alleging 7 that of the 25 transfer requests Defendant allegedly “denied,” Plaintiff voluntarily 8 withdrew 12 of them because they were below her pay grade.1 (Proposed TAC ¶ 42(D).) 9 As Defendant now argues, Plaintiff’s act of withdrawing applications for transfers below 10 her pay grade cannot be construed as a “denial” of a transfer by Defendant or, for that 11 matter, a discriminatory act on the part Defendant. Plaintiff alleges no facts from which the 12 Court could plausibly infer that Defendant’s alleged reticence to consider a candidate for a 13 position below the candidate’s pay grade was pretext in Plaintiff’s case. Before filing the 14 TAC, Plaintiff shall remove Paragraph 42(D) and amend the remaining text of Paragraph 15 42 (and the TAC as a whole) to remove reference to the 12 withdrawn applications. 16 2. Paragraph 43—Plaintiff’s Self-Demotion 17 In Paragraph 43 of the Proposed TAC, Plaintiff alleges: [18] Due to the harassment, discrimination, and retaliation, in December 2019, 19 Jennifer self-demoted as an Operational Risk Consultant (Level 4) (ORC 4) from ORC 5, her current position, with a substantial cut in pay, cut in annual [20] raise, loss of bonus, and a less prestigious job title with lower earning and 21 promotion potential, to escape Sandi’s unprofessional behavior. 22 Defendant contends that Plaintiff’s allegation of self-demotion is not actionable against 23 Defendant, at least without further factual allegations not contained in the Proposed TAC. 24 In her Reply, Plaintiff acknowledges the Ninth Circuit has not recognized a cause of action 25 of discrimination arising from constructive demotion—voluntary demotion caused by [26] 27 1 The Court disagrees with Plaintiff that these paragraphs “are not at issue in this Motion.” (Reply at 6.) The entire Proposed TAC is at issue, so long as the argument is not one the [28] Court has already resolved in prior Motions. 1 adverse working conditions—but Plaintiff analogizes constructive demotion with the 2 recognized cause of action arising from constructive discharge. 3 “[C]onstructive discharge occurs when the working conditions deteriorate, as a 4 result of discrimination, to the point that they become sufficiently extraordinary and 5 egregious to overcome the normal motivation of a competent, diligent, and reasonable 6 employee to remain on the job to earn a livelihood and to serve his or her employer.” 7 Poland v. Chertoff, 494 F.3d 1174, 1184 (9th Cir. 2007) (quoting Brooks v. City of San 8 Mateo, 229 F.3d 917, 930 (9th Cir. 2000)). The constructive discharge inquiry is objective. 9 See id. at 1184–85. It cannot be based upon a plaintiff’s preference for one position over 10 another and does not turn on whether the plaintiff subjectively viewed his or her work 11 conditions as “a career ender” or “egregious.” See id. at 1184–85 (no constructive discharge 12 when plaintiff demoted to non-supervisory position and reassigned to another state away 13 from family). In addition, “[d]issatisfaction with work assignments, a feeling of being 14 unfairly criticized, or difficult or unpleasant working conditions are not so intolerable as to 15 compel a reasonable person to resign.” Cecala v. Newman, 532 F. Supp. 2d 1118, 1168 (D. 16 Ariz. 2007 ). The Ninth Circuit has “set the bar high for a claim of constructive discharge 17 because federal antidiscrimination policies are better served when the employee and 18 employer attack discrimination within their existing employment relationship, rather than 19 when the employee walks away and then later litigates whether [his or her] employment 20 situation was intolerable.” Poland, 494 F.3d at 1184 . 21 A constructive discharge inquiry—or constructive demotion inquiry, accepting that 22 claim as meritorious for the purpose of this analysis—can be a question for a factfinder, but 23 that principle does not relieve a plaintiff from alleging sufficient facts in the complaint to 24 make such a claim plausible. Even if the Court takes all of Plaintiff’s allegations as true, they 25 do not rise to the level of demonstrating objectively egregious working conditions sufficient 26 to support a constructive discharge or demotion claim. For that reason, Plaintiff fails to state 27 a claim on the basis of her voluntary demotion. Plaintiff shall therefore remove Paragraph 28 43 from the Proposed TAC as a basis of a charge of discrimination against Defendant. 3. Paragraph 76(B)—Overlooking Plaintiff for Tap-on-the1 Shoulder Promotions [2] 3 Lastly, Defendant argues Plaintiff’s proposed allegations in Paragraph 76(B) of the 4 Proposed TAC regarding the fact that male or younger employees were given promotions 5 without applying—“tap-on-the-shoulder promotions”—when Plaintiff was not offered 6 such a promotion are futile because they do not show that Defendant denied Plaintiff a 7 promotion she applied for, and because they were not included in Plaintiff’s two Charges 8 to the EEOC. Regarding the first point, the Court agrees with Plaintiff that an employer’s 9 practice of promoting other (male and/or younger, less-qualified) employees while 10 overlooking Plaintiff for a promotion, even in the absence of an application process, may 11 constitute a discriminatory act. See Dukes v. Wal-Mart Stores, Inc., 222 F.R.D. 137 , 148 12 (N.D. Cal. 2004) (explaining “tap on the shoulder” promotion process in which hiring 13 “guidelines set forth only the minimum requirements for advancement” and “decisions as 14 to who will actually be selected [for promotion] are based largely on subjective criteria”). 15 With regard to Plaintiff’s exhaustion of administrative remedies, in her March 24, 16 2022 EEOC Charge, Plaintiff alleged she unfairly received “Needs Improvement” reviews 17 in December 2021 and January 2022 and, “as a result, I was unable to move to the next 18 position, which would provide me a significantly larger earning potential.” (Doc. 51-1, 19 EEOC Charge dated Mar. 24, 2022.)2 If the Court reads the Charge liberally, Plaintiff at 20 least raised the fact that she was not promoted as of March 24, 2022, based on Defendant’s 21 alleged act in January 2022. The Court disagrees with Plaintiff that the dates the tap-on22 the-shoulder promotions of others occurred do not matter in resolving whether Plaintiff’s 23 claim survives Defendant’s Rule 12(b)(6) challenge. Indeed, much of the Court’s prior two 24 Orders (Docs. 20, 41) concerned this very point. Now, at the Proposed Third Amended 25 Complaint, the Court finds itself again repeating what it has stated in prior Orders 26 examining Plaintiff’s proposed pleadings. [27] 2 Plaintiff’s allegations in Paragraph 76(D) post-date Plaintiff’s first Charge to the EEOC. [28] (See Doc. 14 at 14-15, EEOC Charge dated Jan. 17, 2020.) 1 As Plaintiff knows by now—indeed should have known without the Court 2 explaining it twice previously (Docs. 20, 41)—to state an actionable claim in federal court 3 for a violation of Title VII or the ADEA, a charging party must file a charge with the EEOC 4 or applicable state agency within 300 days of the occurrence of each discrete discriminatory 5 act prior to commencing federal action. Nat’l R.R. Passenger Corp. v. Morgan, 536 U.S. 6 101, 113 (2002) (“Each discrete discriminatory act starts a new clock for filing charges 7 alleging that act.”). “The requirement, therefore, that the charge be filed ‘after’ the practice 8 ‘occurred’ tells us that a litigant has up to . . . 300 days after the unlawful practice happened 9 to file a charge with the EEOC.” Id. at 109–10. Thus, Plaintiff’s claims of tap-on-the10 shoulder promotions of others in her proposed TAC must have occurred within 300 days 11 prior to submitting the March 24, 2022 EEOC charge. 12 To begin with, Plaintiff’s allegations in Paragraphs 76(B)(2), (4), and part of (7) 13 occurred in April 2022, after Plaintiff filed her March 24, 2022 EEOC Charge. Obviously, 14 they were not included in the EEOC Charge and must be removed from the Proposed TAC. 15 Plaintiff’s allegations in Paragraphs 76(B)(1) and (3) have no date. Plaintiff shall either 16 add the date, if it falls within the acceptable window of time, or delete those allegations. 17 Plaintiff’s allegations in Paragraphs 76(B)(5), (6), part of (7), (8), and (9) pertain (at least 18 in part) to January 2022. The Court can plausibly infer they occurred after Plaintiff received 19 her January 2022 “Needs Improvement” review making her ineligible for promotion, as 20 Plaintiff alleges in her EEOC Charge, and those allegations may remain in the TAC. 21 B. Motion to Stay 22 In her Motion for Leave to File a Fourth Amended Complaint (Doc. 63), Plaintiff 23 states she filed another EEOC Charge on August 9, 2022, and received a right to sue letter 24 six days later, on August 15, 2022. The Court will grant Defendant’s subsequent request 25 (Doc. 65) to stay briefing on Plaintiff’s Motion for Leave to File a Fourth Amended 26 Complaint, because the Court had not yet ruled on Plaintiff’s Motion for Leave to File a 27 TAC, so no TAC yet existed on the docket from which Plaintiff could draft a Proposed 28 Fourth Amended Complaint. The Court will enter a new briefing schedule below. The 1 Court will also strike Plaintiff’s pending Motion for Leave to File a Fourth Amended 2 Complaint (Doc. 63) and require Plaintiff to refile it to include a Proposed Fourth Amended 3 Complaint red-line based on the now-changed TAC that Plaintiff shall file. 4 The Court has inherent authority to manage its docket, and in that respect the Court 5 has reached the end of its rope with regard to this matter. Plaintiff could no doubt continue 6 almost indefinitely the cycle of gathering allegations against Defendant, filing an EEOC 7 charge, receiving a right to sue letter, and filing another motion to amend the complaint. 8 But this matter has been pending for 20 months—since May 2021—and does not yet have 9 an operative Scheduling Order under the Federal Rules of Civil Procedure. Indeed, the 10 parties have not even briefed the latest of Plaintiff’s motions to amend. As a matter of 11 judicial efficiency and repose, there must come a date when the continuing allegations 12 related to this lawsuit must end and the litigation must proceed. In that vein, Plaintiff will 13 not be permitted to further amend the complaint in this matter beyond the Fourth Amended 14 Complaint, should the Court grant her leave to file that pleading. Thereafter, Plaintiff may 15 bring any new allegations against Defendant in a separate lawsuit. This case must now 16 proceed to discovery based on the known, meritorious allegations, and the Court is now 17 prepared to enter another Scheduling Order and move this matter forward. 18 Accordingly, the parties shall also jointly file a proposed “Second Scheduling 19 Order.” The parties shall use the Court’s prior Scheduling Order, at Doc. 22, for this 20 purpose, proposing new deadlines beginning with “4. Fact discovery shall be completed by 21 ______.” The deadlines prior to that have now passed. 22 IT IS THEREFORE ORDERED granting in part and denying in part Plaintiff’s 23 Motion for Leave to File a Third Amended Complaint (Doc. 51), as detailed in this Order. 24 IT IS FURTHER ORDERED that Plaintiff shall file the Third Amended 25 Complaint, as modified by the limitations specified in this Order, by January 20, 2023. 26 IT IS FURTHER ORDERED granting Defendant’s Motion to Stay Deadline to 27 Respond to Plaintiff’s Motion for Leave to File a Fourth Amended Complaint (Doc. 65). [28] 1 IT IS FURTHER ORDERED striking Plaintiff's Motion for Leave to File a Fourth Amended Complaint (Doc. 63) with leave to refile based on the newly-filed Third 3 || Amended Complaint. 4 IT IS FURTHER ORDERED that Plaintiff shall file an amended Motion for || Leave to File a Fourth Amended Complaint by February 3, 2023. Defendant shall respond □□ by February 17, 2023, and Plaintiff shall file any Reply by February 24, 2023. No further || motions to amend the complaint shall be permitted in this matter. 8 IT IS FURTHER ORDERED that the parties shall jointly file a proposed 9|| Scheduling Order, as detailed in this Order, by February 24, 2023. 10 Dated this 11th day of January, 2023. CN 11 “wok: [12] Unig StatesDistrict Judge [28] -9-