Johnson v. National Railroad Passenger Corporation et al

Filing 67

ORDER DENYING 48 MOTION TO DISMISS OR SEVER. Signed by Judge William Alsup. (whalc2, COURT STAFF) (Filed on 11/29/2018)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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No. C 18-00994 WHA

CHRISTOPHER JOHNSON,

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For the Northern District of California

United States District Court

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Plaintiff,
v.
ACCURATE BACKGROUND, LLC, a
California limited liability company; FIRST
CORPORATE CONSULTING INC., an
Illinois corporation dba UNITED RISK
INTERNATIONAL and INTERNATIONAL
TRACE; NEVER ENDING IDENTITY
SCREENING, LLC, a Virginia limited liability
company; and NATIONAL RAILROAD
PASSENGER CORPORATION dba
AMTRAK, a District of Columbia corporation,

ORDER DENYING
MOTION TO DISMISS
OR SEVER

Defendants.
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INTRODUCTION
In this wrongful termination and consumer-reporting action, defendant former employer

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moves to dismiss certain claims on the ground that plaintiff previously dismissed defendant

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with prejudice. In the alternative, defendant employer requests it be severed from this action as

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a misjoined party. For the reasons set forth below, both motions are DENIED.

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STATEMENT
Plaintiff Christopher Johnson applied to work for defendant National Railroad Passenger
Corporation, doing business as Amtrak. Amtrak offered plaintiff a job subject to a background
check. Plaintiff alleges that the consumer-reporting defendants furnished Amtrak with an

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erroneous criminal background report containing a purported felony conviction. Plaintiff has

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never been convicted of a crime. Plaintiff also alleges that when he informed Amtrak’s human

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resources department about the inaccuracies in the report, which plaintiff claims were

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immediately discoverable, Amtrak still rescinded the job offer based wholly on the criminal

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conviction in the background report (Second Amd. Comp. ¶¶ 13–14, 16–30).

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In January 2018, plaintiff filed the instant lawsuit against Amtrak and a consumer-

claims against Amtrak for both consumer-reporting violations and discrimination under

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California’s Fair Employment and Housing Act (“FEHA”). Plaintiff sued under the theory that

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Amtrak denied plaintiff employment based on its bright-line policy of disqualifying applicants

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For the Northern District of California

reporting agency. Plaintiff’s original complaint contained nine claims for relief, including three

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United States District Court

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with criminal records, and that bright-line policy disparately impacted African American

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applicants (Dkt. No. 1-1 ¶ 39–40; Second Amd. Comp. ¶¶ 37).

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The parties agree that plaintiff and Amtrak then entered into a confidential settlement

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agreement (Br. 2–3; Opp. 1–3, 6). In April 2018, plaintiff filed a notice of voluntary dismissal,

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dismissing Amtrak with prejudice (Dkt. No. 14). The notice of dismissal did not append the

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settlement agreement. Nor did the parties request the Court to retain ancillary jurisdiction to

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enforce any settlement agreement. The notice of dismissal stated in relevant part:

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[P]ursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(i)
Plaintiff Christopher Johnson voluntarily dismisses only . . . Amtrak
. . . . Such dismissal shall be with prejudice.

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Perhaps as part of the settlement, Amtrak thereafter hired plaintiff as an electrician in

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one of its Oakland facilities but terminated his employment less than four months later. Amtrak

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claims it terminated plaintiff’s employment because he violated safety policies. Plaintiff alleges

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he was terminated in retaliation for asserting his original claims against Amtrak and that the

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cited safety violations were pretextual grounds (Second Amd. Comp. ¶¶ 5–6, 37–40).

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Plaintiff has amended his complaint twice. The first amended complaint added two

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more consumer-reporting defendants. The operative second amended complaint re-named

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Amtrak as a defendant. The second amended complaint contains eight claims for relief against

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the consumer-reporting defendants regarding the background report and asserts two claims
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solely against Amtrak: (1) retaliatory termination under the FEHA and (2) California common

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law wrongful termination in violation of public policy (Dkt. Nos. 34, 41).

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Amtrak now moves to dismiss plaintiff’s ninth and tenth claims regarding his

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termination on the ground that plaintiff previously dismissed Amtrak with prejudice. In the

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alternative, Amtrak requests to sever itself from this action as a misjoined party. This order

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follows full briefing and oral argument.

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ANALYSIS

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Both parties support their arguments with matters outside the pleadings, inviting

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consideration of their interpretations of the settlement agreement. In the context of a motion to
dismiss under Rule 12(b)(6), a district court may take judicial notice of facts “not subject to

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For the Northern District of California

United States District Court

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reasonable dispute” or may examine documents incorporated into the complaint by reference

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without converting the motion into one for summary judgment. Khoja v. Orexigen

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Therapeutics, Inc., 899 F.3d 988, 998 (9th Cir. 2018). The settlement agreement and extra-

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pleading matters are neither. The parties do not request judicial notice. This order declines to

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judicially notice them and does not convert this motion into one for summary judgment.

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Amtrak asserts, without any authority, that plaintiff’s “prior dismissal of Amtrak with

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prejudice from this very same action in January serves as a bar to naming Amtrak anew as a

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defendant on unrelated claims,” in this same action (Br. 1). The earlier dismissal with prejudice

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operates to bar any and all claims previously asserted against Amtrak, but those claims have not

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been re-asserted. What is now asserted against Amtrak are new claims based on events after the

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dismissal. Those new claims based on later events are not barred. Plaintiff could assert them in

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a new lawsuit and has instead asserted them in the original suit by way of amendment. If the

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settlement agreement contains a covenant not to sue, possibly that would bar the new claims but

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nothing of the sort has been shown. As for severance, we will wait until the final pretrial

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conference to see whether separate trials will be warranted. Meanwhile, discovery can proceed

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as to all parties for the sake of efficiency. This is without prejudice to an early motion for

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summary judgment by Amtrak.

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CONCLUSION
For the foregoing reasons, Amtrak’s motion to dismiss is DENIED. Amtrak’s motion to
sever its trial from the other defendants is DENIED.

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IT IS SO ORDERED.

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Dated: November 29, 2018.

WILLIAM ALSUP
UNITED STATES DISTRICT JUDGE

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For the Northern District of California

United States District Court

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