Contreras v. Green Thumb Produce, Inc.

Facts and statutory framework

The case turns on the interaction between two Labor Code provisions. California’s Equal Pay Act provides that an employer “shall not pay any of its employees at wage rates less than the rates paid to employees of the opposite sex [or of another race or ethnicity] for substantially similar work.” (§ 1197.5, subds. (a) & (b); see 116 Cal.App.5th at p. 1255, fn. 2.) As the court underscored, the Act “does not prohibit variations in wages; it prohibits discriminatory variations in wages.” (Id. at p. 1254, quoting Allen v. Staples, Inc. (2022) 84 Cal.App.5th 188, 194.) A pay gap untethered to a protected characteristic is therefore outside the Act’s reach.

Labor Code section 1102.5(b), by contrast, is “California’s general whistleblower statute.” (116 Cal.App.5th at p. 1259, quoting Carter v. Escondido Union High School Dist. (2007) 148 Cal.App.4th 922, 933.) It prohibits an employer from retaliating against an employee “for disclosing information … to a person with authority over the employee … if the employee has reasonable cause to believe that the information discloses a violation of state or federal statute.” (§ 1102.5(b); 116 Cal.App.5th at pp. 1259–1260.) The statute thus protects the act of reporting a reasonably suspected violation, independent of whether a violation in fact occurred.

Manuel Contreras worked at Green Thumb Produce — a produce packager — from 2016 to 2020, primarily driving forklifts in the sanitation department. (116 Cal.App.5th at p. 1255.) He discovered that the company paid him less than other employees performing similar duties, some with less seniority, and raised the disparity with supervisors several times without result. (Ibid.) In August 2020 he began researching his rights “because he thought the law required equal pay for equal work.” (Ibid.) He contacted the Labor Commissioner’s Office and spoke with a deputy labor commissioner who told him Green Thumb “might be violating the law,” referred him to the Equal Pay Act, and directed him to the agency’s website. (Id. at pp. 1255–1256.) There Contreras printed and read a seven-page document titled “California Equal Pay Act: Frequently Asked Questions” (the FAQ), containing 32 questions and answers. (Id. at p. 1256.)

On September 3, 2020, Contreras brought the FAQ to work, intending to present it to human resources and ask for a raise. (116 Cal.App.5th at p. 1256.) During his lunch break he showed it to coworkers, hoping one would serve as a witness; his manager intervened and brought him to the human resources manager, who looked over the FAQ, returned it, told him he “should not be showing the FAQ to employees,” and asked why he had contacted the Labor Commissioner. (Ibid.) After his raise request was denied and a dispute over forklift duties escalated into an accusation of insubordination, Contreras was sent home; the next day he was escorted off the premises and received a termination letter citing a litany of policy violations. (Id. at pp. 1256–1257.) Critically, Contreras conceded at trial that he “did not believe his unequal wages were based on his sex, race, or ethnicity” — and that, given his “10th grade education,” he nonetheless believed “there might be an EPA violation.” (Id. at p. 1257.)

Procedural history

Contreras sued in 2021, asserting three retaliation causes of action: retaliation for exercising employment rights (§ 98.6), whistleblower retaliation (§ 1102.5), and wage-discussion retaliation (§ 232). (116 Cal.App.5th at p. 1257.) The trial court instructed the jury on the section 1102.5(b) claim using CACI No. 4603, modified to state that Contreras “only had to have a reasonable belief that [Green Thumb] was violating state law,” and that “[t]hat belief did not have to be, in fact, legally correct under the law.” (Id. at pp. 1257–1258.) The jury found for Contreras on all three claims, awarding $53,000 in past economic damages, $72,428 in future economic damages, and $47,000 in past noneconomic damages. (Id. at p. 1257.)

Green Thumb moved for partial JNOV on the section 1102.5 claim only, arguing the evidence was insufficient because Contreras admitted the disparity was not based on sex, race, or ethnicity, so his mistaken belief that the Equal Pay Act applied could not create liability. (116 Cal.App.5th at p. 1258.) The trial court agreed, finding that Contreras “had not made any complaints of any violation of law and that [he] cannot make up a non-existent law to gain § 1102.5 protections,” and entered a second amended judgment that stripped the section 1102.5 recovery and its associated penalty. (Ibid.) Contreras appealed from that judgment. (Ibid.)

Issue

Does an employee’s mistaken interpretation of the law he invokes necessarily defeat a Labor Code section 1102.5(b) whistleblower-retaliation claim — or does the statute’s “reasonable cause to believe” standard permit recovery where the employee identified a real legal foundation for his suspicion but misunderstood its scope, so long as his belief was objectively reasonable? (116 Cal.App.5th at pp. 1258–1259.)

Holding

Reasoning

1. The standard of review framed the outcome. The court reviewed the threshold legal question — whether a mistaken legal interpretation defeats a section 1102.5(b) claim — de novo, and the JNOV ruling under the deferential substantial-evidence standard. (116 Cal.App.5th at p. 1259, citing Davis Boat Manufacturing-Nordic, Inc. v. Smith (2023) 95 Cal.App.5th 660, 672, and I.C. v. Compton Unified School Dist. (2025) 108 Cal.App.5th 688, 698.) A JNOV “may be granted only if … there is no substantial evidence in support” of the verdict, and on appeal the court must “accept all evidence supporting” the verdict, “draw all reasonable inferences” in its favor, and not “reweigh the evidence.” (Id. at p. 1259, quoting Schmidt v. Superior Court (2020) 44 Cal.App.5th 570, 581.) Framing the dispute this way effectively required Green Thumb to show that no reasonable juror could have credited Contreras’s belief.

2. The statute protects reasonable belief, not legal accuracy. Grounding its analysis in the Supreme Court’s decision in People ex rel. Garcia-Brower v. Kolla’s, Inc. (2023) 14 Cal.5th 719, the court reiterated that section 1102.5(b)’s protections turn on whether the employee “‘has reasonable cause to believe that the information discloses a [legal] violation.’” (116 Cal.App.5th at pp. 1259–1260, quoting Kolla’s at p. 734.) “[T]he relevant inquiry is not whether the conduct ‘actually violated’ any specific statute or regulation, but whether the plaintiff ‘reasonably believed that there was a violation.’” (Id. at p. 1260, quoting Killgore v. SpecPro Professional Services, LLC (9th Cir. 2022) 51 F.4th 973, 988.) The standard is one of “objective reasonableness,” which “does not protect employees who … unreasonably believe” a violation has occurred. (Ibid., quoting Kolla’s at pp. 731, 734.) That framing made the employee’s subjective legal error largely beside the point: the question was the reasonableness of the belief, not its doctrinal correctness.

3. The type of mistake is not controlling. The court observed that a mistaken belief can arise from an error about (1) the law, (2) the facts, or (3) both, and saw “no reason why the type of mistake should be controlling.” (116 Cal.App.5th at p. 1260.) The “proper focus is on the reasonableness of an employee’s beliefs, and preserving the legislative intent to encourage workers to report activity they believe is unlawful.” (Ibid.) This placed mistakes of law on the same analytical footing as mistakes of fact, which case law already treats as compatible with reasonable-cause liability.

4. Distinguishing the “nonexistent law” line of cases. The court agreed with Green Thumb’s premise that “a section 1102.5 claimant may not rely on a perceived violation of a nonexistent law”: to have a reasonably based suspicion, the employee “must be able to point to some legal foundation … some statute, rule or regulation which may have been violated.” (116 Cal.App.5th at pp. 1260–1261, quoting Ross v. County of Riverside (2019) 36 Cal.App.5th 580, 592.) But Contreras did not rely on an “unnamed” or invented law, as in Love v. Motion Industries, Inc. (N.D.Cal. 2004) 309 F.Supp.2d 1128, 1135; he “point[ed] to some legal foundation for his suspicion — namely, the EPA,” a real statute that on its face governs unequal pay for substantially similar work. (Id. at p. 1261.) His error was about the Act’s scope, not the existence of any law at all — a distinction the court treated as dispositive.

5. Rejecting the floodgates and “common sense” arguments. Green Thumb warned that the rule would let employees recover on absurd premises — that an employer must give a 100 percent annual raise, or pay women twice as much as men. (116 Cal.App.5th at p. 1261.) The court answered that the “objective reasonableness” requirement screens out such claims: those “hypothetical mistaken legal interpretations … are unreasonable, precluding any relief under the statute.” (Ibid., quoting Kolla’s at p. 734.) Reasonableness, in other words, is the limiting principle that prevents the holding from protecting frivolous beliefs.

6. Statutory purpose. Adopting Green Thumb’s reading, the court reasoned, “would defeat the Legislature’s purpose” of encouraging whistleblowers, because it “would deprive employees of the statute’s protection simply because the workers have no legal training and lack the expertise to properly interpret a statute,” chilling reports by those most likely to misread the law. (116 Cal.App.5th at p. 1261.) The court therefore held that although a layperson’s incorrect legal interpretation “may be unreasonable under some circumstances,” there is “no basis to find that it will always be unreasonable”; reasonableness “is generally a question of fact to be resolved by a jury.” (Ibid., quoting Edgerly v. City of Oakland (2012) 211 Cal.App.4th 1191, 1206.)

7. Substantial evidence supported the verdict. Turning to the record, the court found ample support for the jury’s reasonable-cause finding. A deputy labor commissioner — the official who “enforces California’s labor laws” — told Contreras that Green Thumb “might” have violated the law, and “it is reasonable for a lay person to give that assessment credit.” (116 Cal.App.5th at p. 1262, citing Kilby v. CVS Pharmacy, Inc. (2016) 63 Cal.4th 1, 13.) The FAQ itself was genuinely misleading to a non-lawyer: its first two questions emphasized “substantially similar work” with only one of six bullet points mentioning sex and none mentioning race or ethnicity; question 9 likewise spoke of comparing “substantially similar” jobs without reference to any protected class; and “more than half of the questions … omit sex, race, or ethnicity.” (Ibid.) Even “the EPA’s name … merely referencing equal pay,” added to the potential for confusion. (Ibid.) The court candidly acknowledged that trained judges reading the whole FAQ “correctly reflects that the EPA only prohibits discriminatory wage variations,” but “a lay person with no formal legal training could easily misinterpret the FAQ similarly to Contreras, especially when told by a deputy labor commissioner that there was a potential violation.” (Id. at pp. 1262–1263.) Because the jurors had the FAQ before them and found Contreras’s reading reasonable “from the perspective of a layperson,” substantial evidence supported the verdict, and a contrary appellate judgment would impermissibly reweigh the evidence. (Id. at p. 1263, citing Rupf v. Yan (2000) 85 Cal.App.4th 411, 429, fn. 5.)

Significance

Contreras is among the first published California decisions to address head-on whether a mistake of law — as opposed to a mistake of fact — can support a section 1102.5(b) claim, and it answers that the reasonable-cause inquiry does not distinguish between the two. The decision operationalizes the Supreme Court’s “objective reasonableness” standard from Kolla’s by locating the line not at doctrinal accuracy but at whether the employee can “point to some legal foundation” for the suspicion. (116 Cal.App.5th at pp. 1260–1261.) That places Contreras squarely within the protective arc of California whistleblower law: it reinforces that section 1102.5(b), like its federal analogues, shields good-faith, reasonably grounded reporting rather than only accurate legal conclusions, and it confirms that the reasonableness of a lay employee’s belief is normally for the jury — an allocation of decisionmaking that materially raises the bar for employers seeking summary disposition. The opinion’s reach is bounded by its own limiting principle: the same “objective reasonableness” requirement that saved Contreras’s claim is what defeats the absurd hypotheticals, so the holding expands protection for plausible misreadings without protecting fanciful ones.

Key quotes

“[S]ection 1102.5(b) only requires an employee to have ‘reasonable cause’ to believe that a law has been violated. … There is no requirement that the employee prove an actual violation. As such, section 1102.5 may provide relief for an employee who reasonably believed a legal violation occurred despite incorrectly analyzing the relevant law.” (Contreras, supra, 116 Cal.App.5th at p. 1261.)

“[W]hile a lay employee’s incorrect legal interpretation may be unreasonable under some circumstances, we see no basis to find that it will always be unreasonable. Rather, ‘[r]easonableness is generally a question of fact to be resolved by a jury.’” (Contreras, supra, 116 Cal.App.5th at p. 1261.)

Read the full opinion (official slip opinion) →

Practice pointer

Open questions

The court expressly confined its holding to a mistake about “the law,” noting that the same analysis would apply to factual or mixed mistakes but declining to map the boundaries of each. (116 Cal.App.5th at p. 1260.) It also did not identify where, short of the Equal Pay Act, a cited “legal foundation” becomes too attenuated to count — the opinion distinguishes Love’s “unnamed statute” problem but leaves unresolved how specific or apt the identified authority must be. (Id. at pp. 1260–1261.) Nor did the court decide that any particular misreading is reasonable as a matter of law; it held only that this record presented a jury question, leaving open when, if ever, a legal mistake is so plainly unreasonable that JNOV or nonsuit is proper. (Id. at p. 1261.) Finally, because Green Thumb challenged only the section 1102.5 cause of action, the opinion does not address the interplay among the employee’s overlapping section 98.6, section 1102.5, and section 232 theories, or how the modified CACI No. 4603 instruction should read in future cases. (Id. at pp. 1257–1258.)