Kirbyson v. Tesoro Corporation et al

Filing 51

ORDER by Judge Samuel Conti denying 36 Motion for Sanctions (sclc1, COURT STAFF) (Filed on 6/2/2010)

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1 2 3 4 5 6 7 8 9 10 v. TESORO REFINING AND MARKETING COMPANY; BRUCE SMITH; DAN PORTER; WILLIAM BODNAR; BILL REITZEL; DANIEL CARLSON; RICK RIOS; TAMMY MEAMBER; DIANE DANIELS; LARRY ANGEL; UNITED STEEL WORKERS, INTERNATIONAL UNION LOCAL 5; JEFF CLARK; STEVE ROJEK, and DOES 1 through 200, inclusive, Defendants. I. INTRODUCTION Now before the Court is the Motion for Sanctions filed by Individual Defendants Bruce Smith, Dan Porter, William Bodnar, Bill Reitzel, Daniel Carlson, Rick Rios, Tammy Meamber, and Diane Daniels (collectively, "the Individual Defendants"). 36 ("Mot."), 37 ("Mem. of P. & A."). Docket Nos. GEORGE L. KIRBYSON, Plaintiff, ) Case No. 09-3990 SC ) ) ORDER DENYING MOTION FOR ) SANCTIONS ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF CALIFORNIA United States District Court For the Northern District of California 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 Plaintiff George Kirbyson ("Plaintiff") filed an Opposition, and the Individual Defendants submitted a Reply. Docket Nos. 43, 45. For the reasons stated below, the Motion for Sanctions is DENIED. /// /// 1 2 3 4 5 6 7 8 9 10 For the Northern District of California II. BACKGROUND Plaintiff joined the U.S. Air Force in 1994, and transitioned into the Air Force Reserve in 1999. ("SAC"), Docket No. 41, 9. Second Amended Complaint Plaintiff began working as a refinery Id. 10. operator at the Golden Eagle Refinery in November 1999. In 2003, Tesoro Refining and Marketing Company ("Tesoro") purchased the refinery. Id. On January 5, 2005, Plaintiff was recalled to active duty, and Tesoro placed him on a military leave of absence. Id. 12. While serving in Iraq, Plaintiff was injured, and Id. 13. Id. He was medically retired from the On December 22, 2008, Tesoro Id. 18. See permanently disabled. United States District Court 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 military in November 2008. terminated Plaintiff's employment. On August 28, 2009, Plaintiff commenced this action. Docket No. 1 ("Compl."). First Amended Complaint. On December 3, 2009, Plaintiff filed a See Docket No. 15 ("FAC"). It alleged two causes of action against the Individual Defendants: (1) violation of section 389 et seq. of the California Military and Veterans Code; and (2) negligent hiring, training, supervision and retention. Id. 63-66, 71-73. The Individual Defendants filed a Motion to Dismiss, which the Court granted on March 2, 2010. Docket Nos. 22("MTD"), 32 ("March 2, 2010 Order"). III. LEGAL STANDARD Under Federal Rule of Civil Procedure 11, the court may impose sanctions against a party or attorney when a pleading is filed for an improper purpose, when the legal contentions are not warranted by existing law or a nonfrivolous argument for the extension of existing law, or when the factual contentions lack evidentiary 2 1 2 3 4 5 6 7 8 9 10 For the Northern District of California support. Fed. R. Civ. P. 11(b)-(c). "The rule provides two independent bases for the imposition of sanctions: one if a pleading is frivolous and another if it has been filed for an improper purpose." Westlake North Property Owners Ass'n v. City The court of Thousand Oaks, 915 F.2d 1301, 1305 (9th Cir. 1990). must determine (1) whether the complaint is legally or factually baseless from an objective perspective, and (2) if the attorney has conducted a reasonable and competent inquiry before signing and filing it. Christian v. Mattel, Inc., 286 F.3d 1118, 1127 "The key question in assessing frivolousness is (9th Cir. 2002). United States District Court 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 whether a complaint states an arguable claim - not whether the pleader is correct in his perception of the law." Hudson v. Moore Business Forms, Inc., 836 F.2d 1156, 1159 (9th Cir. 1987). IV. DISCUSSION The Individual Defendants contend that Plaintiff's claim against them based on section 389 of the California Military and Veterans Code was baseless. Mem. of P. & A. at 10. Section 389 provides, in part, that "[n]o person shall discriminate against any officer, warrant officer or enlisted member of the military or naval forces of the state or of the United States because of that membership." Cal. Mil. & Vet. Code 394(a). This Court determined that individual employees could not be held liable under this statute for claims arising out of the performance of personnel management duties. March 2, 2010 Order at 9-12. The Court noted Id. at 10. that there was no legal authority directly on point. Plaintiff's argument was text-based, relying on the fact that the statute states "no person" shall discriminate. See id. This 3 1 2 3 4 5 6 7 8 9 10 For the Northern District of California argument, although unsuccessful, was not legally baseless or frivolous. The Court also dismissed Plaintiff's claim against the Individual Defendants for negligent hiring, training, supervision, and retention. Id. at 12. The claim was based on an allegation that, during the course of a U.S. Department of Labor investigation, Diane Daniels ("Daniels") stated she had never heard of the Uniformed Services Employment and Reemployment Rights Act ("USERRA"). See id. at 13 n.5; FAC 37. Daniels worked in Tesoro's Human Resources Department, and she informed Plaintiff of his termination. FAC 27-28. Although the Court found this United States District Court 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 allegation of ignorance concerning the USERRA insufficient to state a plausible claim for negligent hiring, training, supervision, and retention of Daniels, the claim was not entirely baseless or frivolous. These were the only claims asserted against the Individual Defendants. While both claims were unsuccessful, neither claim was frivolous, and the Court cannot infer they were filed for an improper purpose. Plaintiff's counsel spent 65 hours investigating the facts and researching the law before filing the original complaint, and engaged in an additional 6.5 hours of research before filing the First Amended Complaint. Hewitt Decl. 3, 7.1 After Defendants' counsel sent Plaintiff's counsel a Rule 11 letter dated January 21, 2009, see Chamberlain Decl. Ex. D,2 Plaintiff's 1 Shanan L. Hewitt, attorney for Plaintiff, filed a Declaration in Support of Plaintiff's Opposition to the Motion for Sanctions. Docket No. 43-1. 2 Michael S. Chamberlain, attorney for Defendants, filed a Declaration in Support of the Motion for Sanctions. Docket No. 38. 4 1 2 3 4 5 6 7 8 9 10 For the Northern District of California counsel responded, explaining the basis for believing the claims against the Individual Defendants had merit, see id. Ex. C. The Court dismissed the two claims against the Individual Defendants, but the Court denied the motion to dismiss most of the claims filed against the company, Tesoro. See March 2, 2010 Order at 13-18. The circumstances of this case are not so unusual as to warrant an award of attorney fees to the Individual Defendants. would merely serve to chill zealous advocacy. sanctions are not appropriate in this case. Such an award The Court finds that United States District Court 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 V. CONCLUSION For the reasons stated above, the Court DENIES the Motion for Sanctions filed by the Individual Defendants. IT IS SO ORDERED. Dated: June 2, 2010 UNITED STATES DISTRICT JUDGE 5

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