Mancuso v. Walgreen Co

Filing 26

ORDER GRANTING IN PART AND DENYING IN PART DEFENDANT WALGREEN'S MOTION TO DISMISS AND VACATING HEARING by Judge William Alsup [granting in part and denying in part 6 Motion to Dismiss; granting in part and denying in part 10 Motion to Dismiss]. (whasec, COURT STAFF) (Filed on 9/24/2012)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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GUSTAVO MANCUSO,
No. C 12-03696 WHA

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For the Northern District of California

United States District Court

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Plaintiff,
v.
ORDER GRANTING IN PART AND
DENYING IN PART DEFENDANT
WALGREEN’S MOTION TO
DISMISS AND VACATING HEARING

WALGREEN CO. and DOES 1
through 20, inclusive,
Defendants.

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/

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INTRODUCTION

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In this wrongful-discharge action, defendant Walgreen Co. moves to dismiss plaintiff’s

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complaint for: (1) lack of jurisdiction pursuant to FRCP 12(b)(1); or, in the alternative,

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(2) failing to identify a claim upon which relief can be granted pursuant to FRCP 12(b)(6).

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For the reasons stated below, the motion is GRANTED IN PART AND DENIED IN PART.
SUMMARY

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Plaintiff was an assistant store manager at defendant’s retail facility of Walgreen Co.

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in San Carlos, California (Compl. ¶ 5). In early July 2009, plaintiff gave permission to Linda

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Frank, a subordinate employee, to pay a reduced price for eight pairs of pantyhose that were on

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clearance, which she then purchased. Later that month, Walgreens terminated Ms. Frank on the

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grounds that the reduced price at which she made the purchase had not been authorized (id. at

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¶ 6).

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In February 2010, the California Employment Development Department conducted

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a hearing on Ms. Frank’s appeal from an administrative determination that she had been

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terminated for willful misconduct and was thus ineligible for unemployment insurance benefits.

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Plaintiff testified at the hearing that he had in fact authorized the reduced price for which

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Ms. Frank purchased the pantyhose (id. at ¶ 7). Approximately one month later, Walgreens

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terminated plaintiff, alleging that he had forgotten to close out a cash register. Plaintiff asserts

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the reason was pretextual and that he was instead terminated because of his testimony at the

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EDD hearing (id. at ¶ 8).

1332, Walgreens timely removed the lawsuit from state court on July 13, 2012. Plaintiff’s single

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For the Northern District of California

Plaintiff filed suit against Walgreens in San Mateo Superior Court. Pursuant to 28 U.S.C.

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United States District Court

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claim for relief is entitled “Wrongful Discharge in Violation of Public Policy.” Plaintiff alleges

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that “[b]y terminating [him] in retaliation for the testimony he gave, Defendants violated

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fundamental public policies underlying the protections given in the California Constitution,

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including his freedom of speech, and for the right of Ms. Frank to petition for redress of her

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grievances” (id. at ¶ 10).

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Walgreens alleges that plaintiff’s claim is preempted by the National Labor Relations

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Act, and therefore, pursuant to FRCP 12(b)(1), this Court is without subject-matter jurisdiction.

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Alternatively, Walgreens moves to dismiss plaintiff’s claim for failure to state a claim upon

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which relief can be granted pursuant to FRCP 12(b)(6).

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ANALYSIS

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A motion to dismiss under FRCP 12(b)(6) tests the legal sufficiency of the claims alleged

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in the complaint. See Parks Sch. of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995).

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All material allegations of the complaint are taken as true and considered in the light most

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favorable to the nonmoving party. Ibid. The complaint must contain sufficient factual matter to

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“state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544,

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555 (2007). Where a court dismisses for failure to state a claim pursuant to FRCP 12(b)(6), it

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should normally grant leave to amend unless it determines that the pleading could not possibly

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be cured by the allegation of other facts. Cook, Perkiss & Liehe v. N. Cal. Collection Serv.,

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911 F.2d 242, 247 (9th Cir. 1990).

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FRCP 12(b)(1) provides that a court may dismiss a claim for “lack of jurisdiction over

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the subject matter.” Although the NLRA has no express preemption clause, the Supreme Court

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has articulated:

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Section 10(a) [of the NLRA] gives the National Labor Relations
Board exclusive jurisdiction to prevent and redress unfair labor
practices, and, taken in conjunction with section 14, establishes
clearly that this bill is paramount over other laws that might touch
upon similar subject matters. Thus it is intended to dispel
confusion resulting from dispersion of authority and to establish a
single paramount administrative or quasi-judicial authority in
connection with the development of the Federal American law
regarding collective bargaining.

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For the Northern District of California

United States District Court

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Amalgamated Util. Workers v. Consol. Edison Co., 309 U.S. 261, 267 (1940).
The so-called Garmon preemption protects the primary jurisdiction of the Board by

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preempting state regulation of conduct that is actually or arguably protected or prohibited by the

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NLRA. See San Diego Bldg. Trades Council v. Garmon, 359 U.S. 236, 244 (1959). A judicial

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remedy falls within the scope of Garmon preemption when the alleged claim encompasses

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matters within the provisions of either Section 7 or Section 8 of the NLRA. See Bud Antle, Inc.

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v. Barbosa, 45 F.3d 1261, 1268. Section 7 of the NLRA provides: “Employees shall have the

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right to self-organization, to form, join, or assist labor organizations, to bargain collectively

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through representatives of their own choosing, and to engage in other concerted activities for

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the purpose of collective bargaining or other mutual aid or protection . . . .” 29 U.S.C. 157.

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Section 8 of the NLRA, in relevant part, states that: “It shall be an unfair labor practice for

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an employer . . . to interfere with, restrain, or coerce employees in the exercise of the rights

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guaranteed in section [7] . . . .” 29 U.S.C. 158(a)(1).

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Walgreens argues that plaintiff’s wrongful discharge addresses conduct that is within the

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scope of Sections 7 and 8 of the NLRA and is thus subject to Garmon preemption. This order

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disagrees.

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PLAINTIFF’S CLAIM IS NOT PREEMPTED
BY THE NATIONAL LABOR RELATIONS ACT.

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Walgreens alleges that by testifying on Ms. Frank’s behalf, plaintiff’s conduct was
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for purposes of “mutual aid or protection,” and therefore falls within the scope of NLRA
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preemption. The Supreme Court, however, has recognized limitations to the NLRA’s scope
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of preemption: “[I]t has been held that the ‘mutual aid or protection’ clause protects employees
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from retaliation by their employers when they seek to improve working conditions through resort
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to administrative and judicial forums . . . .” Eastex, Inc. v. N.L.R.B., 437 U.S. 556, at 565–567
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(1978) (emphasis added). In sharp contrast to the decisions cited by Walgreens, here plaintiff’s
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actions were in no way related to improving working conditions at defendant’s retail store.
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purchase price for Ms. Frank, an ex-subordinate. The administrative hearing’s only purpose
For the Northern District of California

United States District Court

Rather, his testimony before the EDD pertained to whether he had authorized a discounted
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was to determine whether Ms. Frank was eligible for unemployment insurance benefits.
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Walgreens cites Eastex for the proposition that plaintiff’s conduct constituted “mutual aid
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or protection” simply because he testified in an administrative forum. In support of its argument,
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Walgreens relies on two California Court of Appeal decisions that both dismissed for lack
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of jurisdiction wrongful termination claims involving adverse administrative testimony.
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See Rodriguez v. Yellow Cab Cooperative, Inc., 206 Cal. App. 3d 668 (1198); Ruscigno v. Am.
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Nat’l Can Co., Inc., 84 Cal. App. 4th 112 (2000). Because those decisions involved union
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grievance proceedings, collective bargaining agreements, and conduct that was allegedly
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for the purpose of protecting union activities, they are easily distinguishable. Such factual
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circumstances clearly demonstrate “concerted activity” for the purposes of “collective bargaining
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or other mutual aid or protection.” In contrast, here plaintiff neither sought to protect any union
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activities nor expose any unfair labor practices.
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Plaintiff’s conduct was not actually or arguably protected or prohibited by the NLRA
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because he did not engage in conduct for the purpose of “providing mutual aid or protection,”
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as interpreted by the Supreme Court in Eastex. Accordingly, plaintiff’s complaint is not
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subject to Garmon preemption and Walgreen’s motion to dismiss plaintiff’s claim pursuant
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to FRCP 12(b)(1) is therefore DENIED.
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Although plaintiff’s claim is not preempted by the NLRA, it still must state a claim upon

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PLAINTIFF’S CLAIM IS INSUFFICIENT.

which relief can be granted. Plaintiff concedes in his opposition that:

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The state constitutional policies alleged in the complaint,
e.g., Plaintiff’s free speech and the right of his ex-subordinate
to petition for redress of her grievances, fail to capture the
fundamental public policy actually implicated by his retaliatory
discharge, namely the public policy in support of a witness giving
truthful testimony (Opp. at 3).

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Accordingly, Walgreen’s motion to dismiss plaintiff’s claim pursuant to FRCP 12(b)(6) is
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GRANTED.
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CONCLUSION
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to FRCP 12(b)(1) is DENIED. Walgreen’s motion to dismiss plaintiff’s claim pursuant to
For the Northern District of California

United States District Court

For the foregoing reasons, Walgreen’s motion to dismiss plaintiff’s claim pursuant
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FRCP (12)(b)(6) for failing to state a claim upon which relief can be granted, however, is
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GRANTED. Plaintiff may seek leave to amend and will have 21 CALENDAR DAYS from the date
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of this order to file a motion, noticed on the normal 35-day track, for leave to file an amended
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complaint. A proposed amended complaint must be appended to the motion and plaintiff must
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plead their best case. Any such motion should clearly explain how the amendments to the
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complaint cure the deficiencies identified herein. The hearing set for September 27, 2012, is
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hereby VACATED.
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IT IS SO ORDERED.
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Dated: September 24, 2012.

WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE

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