Claudio v. Regents of University of California

Facts

The statutory framework. The California Fair Employment and Housing Act (FEHA) makes it “an unlawful employment practice to discharge a person from employment or discriminate against the person in the terms, conditions or privileges of employment, because of physical or mental disability.” (Gov. Code, § 12940, subd. (a); Claudio, supra, 134 Cal.App.4th at p. 242.) Two adjacent provisions, quoted by the court, supply the accommodation framework. Subdivision (m) makes it unlawful “[f]or an employer or other entity covered by this part to fail to make reasonable accommodation for the known physical or mental disability of an applicant or employee.” (Gov. Code, § 12940, subd. (m); Claudio, supra, at p. 242.) Subdivision (n) separately makes it unlawful “[f]or an employer or other entity covered by this part to fail to engage in a timely, good faith, interactive process with the employee or applicant to determine effective reasonable accommodations, if any, in response to a request for reasonable accommodation by an employee or applicant with a known physical or mental disability or known medical condition.” (Gov. Code, § 12940, subd. (n); Claudio, supra, at pp. 242–243.) “Reasonable accommodation,” the court noted, “includes ‘[j]ob restructuring, … reassignment to a vacant position, … and other similar accommodations for individuals with disabilities.’” (Gov. Code, § 12926, subd. (n)(2); Claudio, supra, at p. 242.)

The disability and the move to Florida. Michael Claudio worked at the School of Veterinary Medicine at the University of California at Davis when he “contracted leptospirosis, a disease that left him disabled because he could not work in any area where he might become infected.” (Claudio, supra, 134 Cal.App.4th at p. 227.) He “went on medical leave and moved to Florida.” (Ibid.) An agreed medical examiner concluded — and Claudio did not dispute — that his disability precluded a return to his old job or to “any other job that might expose him to infection from animals,” a restriction that “eliminated any jobs at the Clinic.” (Id. at p. 245.) Claudio was kept on medical-leave status “for a full two years — much longer than the six months ordinarily permitted by University policy — during which plaintiff’s job was held open for him.” (Id. at p. 233.)

The vocational-rehabilitation contact. University vocational rehabilitation counselor Kathleen McLean “attempted to engage [plaintiff] in an interactive process to determine if reasonable accommodation was possible, or to find alternate work for him,” speaking with him in January and March 1999 and exchanging correspondence; she attested that she “attempted to get [plaintiff] to participate in the vocational rehabilitation process, but he refused.” (Claudio, supra, 134 Cal.App.4th at p. 245.)

The April 17 letter and the request to go through counsel. The pivotal evidence — used by both sides for its truth — was Claudio’s April 17, 1999 letter to McLean. (Claudio, supra, 134 Cal.App.4th at p. 234.) In it, Claudio recounted being told, repeatedly, that he had already been fired: he had been advised he was “ineligible for any benefits because [he] had been actively separated (fired) from UCD employment, 8/1/98,” and that “[t]his news was confirmed a second time via telephone inquiry, again a third time via US mail and yet a fourth time upon [his] attorney’s inquiry.” (Id. at p. 235.) Stating he was “amenable to cooperating … in whatever way reasonably possible,” but that “given the obvious complexity of these matters,” it was “necessary to have all reviewed by” counsel, Claudio asked McLean to “address … the university’s interest in now medically separating me from UCD employment … with my attorney.” (Id. at pp. 235–236.)

The unilateral decision not to call. McLean “contacted plaintiff’s attorney’s office only to verify that the attorney was representing plaintiff only on the workers’ compensation case.” (Claudio, supra, 134 Cal.App.4th at p. 236.) In fact, as the court underscored, “she had not talked to plaintiff’s attorney, nor did she speak to anyone about plaintiff’s case,” but “spoke with an employee of the firm, who said the firm did workers’ compensation law.” (Id. at p. 236, fn. 9.) Reasoning that “this was an employment matter, not a workers’ compensation matter,” McLean declined to communicate with counsel, reviewed Claudio’s animal-care-focused resume, found no non-animal-care openings in 30 days, and the University “effected plaintiff’s termination from employment.” (Id. at pp. 228, 246–247.) She conceded she “did not ask the person at the attorney’s office whether she could contact plaintiff directly.” (Id. at p. 247.)

Procedural history

Claudio’s complaint, filed August 7, 2000, alleged four counts: “(1) employment discrimination based on physical disability; (2) wrongful termination in violation of public policy; (3) retaliation for whistleblowing; and (4) intentional infliction of emotional distress.” (Claudio, supra, 134 Cal.App.4th at p. 230.) The Regents moved for summary judgment or summary adjudication, arguing on count one that they “engaged in the required interactive process … but were rebuffed by plaintiff,” that their accommodation efforts “were adequate as a matter of law,” and that Claudio could show no pretext; and arguing that counts two through four failed for nonexhaustion of the University’s internal grievance and administrative-mandamus remedies. (Id. at pp. 231–232.) The trial court (Hon. Thomas Edward Warriner) granted summary judgment, reasoning that the Regents held Claudio’s job open “much longer than required” and that “[r]easonable accommodation does not require the employer to wait indefinitely,” and that Claudio “did not seek review of any of the denials of his administrative grievances.” (Id. at p. 241.) Claudio appealed. The Court of Appeal, Third Appellate District, in a unanimous opinion by Acting Presiding Justice Sims (Davis and Cantil-Sakauye, JJ., concurring), reversed in part. (Id. at pp. 224, 253.)

Issue

The opinion presented two principal questions. First, may an employee sue for the employer’s failure to engage in the interactive process under section 12940, subdivision (n), as a distinct unlawful practice, and did a triable issue exist on that claim? On the operative point, the court framed the inquiry narrowly: “The issue is whether a triable issue exists as to whether it was reasonable for McLean to refuse to communicate with plaintiff’s attorney.” (Claudio, supra, 134 Cal.App.4th at p. 247.) Second, did Claudio show grounds to reverse summary adjudication of counts two through four, given that he never sought administrative mandamus from the denials of his union grievances? (Id. at pp. 249–250.)

Holding

Reasoning

The interactive-process duty is a freestanding statutory wrong. The court began by confirming that the failure to engage in the interactive process is independently actionable. Section 12965 “authorizes the filing of a civil action based upon ‘an unlawful practice,’” and “[n]othing in section 12965 limits such an unlawful practice to the unlawful practice of disability discrimination found in section 12940, subdivision (a).” (Claudio, supra, 134 Cal.App.4th at p. 243.) Extending its own reasoning from Bagatti v. Department of Rehabilitation (2002) 97 Cal.App.4th 344 — which recognized a separate action for failure to accommodate under subdivision (m) — the court held: “The same reasoning applies to subdivision (n) … . An employee may file a civil action based on the employer’s failure to engage in the interactive process.” (Claudio, supra, at p. 243.)

Reaching the claim despite a pleading gap. The court acknowledged a wrinkle: “The complaint did not allege FEHA liability based on the employer’s failure to engage in the interactive process or failure to accommodate a disability,” but “merely alleged the Regents terminated plaintiff’s employment due to his disability.” (Claudio, supra, 134 Cal.App.4th at p. 243.) Because the Regents’ own motion rested on Claudio’s asserted inability to prove a failure to accommodate, because “plaintiff responded in kind,” and because “the Regents do not contend plaintiff’s claim lies outside the allegations of his complaint,” the court chose to “address the claim on the merits.” (Ibid.) It also considered the April 17 letter for its truth, because any authentication objection had been “forfeited” when the Regents themselves submitted the letter without objection from Claudio. (Id. at p. 234.)

The governing summary-judgment standard for accommodation claims. Drawing on Jensen v. Wells Fargo Bank (2000) 85 Cal.App.4th 245, the court set out the demanding test a defendant must meet: “the employer cannot prevail on summary judgment on a claim of failure to reasonably accommodate unless it establishes through undisputed facts that (1) reasonable accommodation was offered and refused; (2) there simply was no vacant position … for which the disabled employee was qualified … ; or (3) the employer did everything in its power to find a reasonable accommodation, but the informal interactive process broke down because the employee failed to engage in discussions in good faith.” (Claudio, supra, 134 Cal.App.4th at pp. 243–244.) Crucially, the duty runs in both directions: “[I]t is the responsibility of both sides to keep communications open and neither side has a right to obstruct the process.” (Id. at p. 244.) That mutuality cut against the Regents, because the question became whether their agent had obstructed the process.

The general rule: an employee may not route the process through counsel. The court did not endorse Claudio’s position categorically. It held that “[o]rdinarily, an employee has no right to withdraw himself from the process and force the employer to engage in the interactive process through the employee’s attorney.” (Claudio, supra, 134 Cal.App.4th at p. 247.) The rationale is functional: “The kind of information designed to be elicited by the interactive process (job skills and interests, etc.) is personal to the individual employee,” and “[r]equiring the employer to use the employee’s attorney as a conduit for this personal information would slow the process unnecessarily.” (Ibid.) The court also rejected Claudio’s claim that University policy required McLean to go through counsel, finding the only evidence — a payroll manager’s testimony that “[g]enerally, when they have representation, we are not to talk to them” — unconnected to “reasonable-accommodations procedure.” (Id. at p. 248, fn. 11.)

The exception: unusual circumstances of the University’s own making. The pivot of the opinion is the court’s recognition that this was not the ordinary case. “Although we conclude that ordinarily the employee cannot force the employer to go through the employee’s attorney for the interactive process, here there were unusual circumstances.” (Claudio, supra, 134 Cal.App.4th at p. 247.) The University “had told plaintiff four times … that his employment had been terminated,” and the fact that he had been dropped from the computer system (“I-4’d”) “made his legal status uncertain.” (Id. at pp. 247–248.) On those facts the court “cannot say as a matter of law that it was unreasonable for plaintiff to require the University to communicate with his attorney.” (Id. at p. 248.) Invoking the ordinary reasons clients consult lawyers — “Lawyers have special skills and knowledge not generally shared by people” — the court concluded that “[a] jury should decide the question whether the University failed to engage in the interactive process in good faith when it refused to communicate with plaintiff’s attorney.” (Ibid.)

The counselor’s unilateral assumption was itself unreasonable. Independently, the court faulted McLean’s method. “[I]t was unreasonable for McLean to make a unilateral decision that plaintiff’s workers’ compensation attorney would not involve himself in this employment matter. She never talked to plaintiff’s attorney. She should have asked him whether he would represent plaintiff in this employment matter.” (Claudio, supra, 134 Cal.App.4th at p. 248.) Having spoken only to a rehabilitation coordinator at the firm — and never having asked whether she could instead contact Claudio directly — McLean drew a conclusion the record did not compel. (Ibid.; id. at p. 247.)

Why the alternative grounds did not save the judgment. The Regents pressed three fallback theories, and the court rejected each. It declined to affirm on section 12940, subdivision (a)(1) — that Claudio could not perform his essential duties even with accommodation — because that argument “overlooks that ‘reasonable accommodation’ includes ‘[j]ob restructuring, … reassignment to a vacant position,’” and so “does not resolve the case.” (Claudio, supra, 134 Cal.App.4th at pp. 244–245.) It declined to affirm on the absence of an open position, because “it cannot be known whether an alternate job would have been found.” (Id. at p. 245.) And it rejected the Regents’ contention that the accommodations offered were “adequate as a matter of law” as procedurally foreclosed: the Regents had moved on the premise that they “offered the ‘required interactive process but were rebuffed,’” so “[i]t is thus too late for the Regents to argue there was no need for an interactive process.” (Id. at pp. 248–249.) Nor was this a futility case like Swonke v. Sprint, Inc. (2004) 327 F.Supp.2d 1128, because “it appears plaintiff may have been physically able to handle clerical positions.” (Claudio, supra, at p. 249.)

Counts two through four fail on exhaustion and appellant’s burden. On the remaining counts, the court agreed with the Regents. As a constitutionally created agency with quasi-adjudicative power over personnel matters, the Regents’ grievance decisions became “final and binding” once Claudio “did not seek administrative mandamus (Code Civ. Proc., § 1094.5) from the unfavorable decisions.” (Claudio, supra, 134 Cal.App.4th at pp. 249–250.) Claudio had filed and lost numerous grievances but “appealed none of them to a superior court,” and he never filed a whistleblower claim under section 8547.10, “which requires such a claim before pursuing court action.” (Id. at pp. 250–251.) Invoking the principle that “it is the appellant’s responsibility to affirmatively demonstrate error,” the court found Claudio’s undeveloped briefing insufficient and “presume[d] the judgment is correct.” (Id. at p. 252.) It therefore concluded Claudio “failed to meet his burden as appellant to show grounds for reversal with respect to counts two, three, and four.” (Ibid.)

Significance

Claudio earns its citation on two fronts. First, it is among the early appellate decisions to confirm, in a published opinion, that the duty to engage in the interactive process under section 12940, subdivision (n), supports an independent civil action, not merely an evidentiary makeweight to a discrimination claim. By porting the logic of Bagatti from subdivision (m) to subdivision (n), the court placed the interactive-process duty on the same statutory footing as the duty to accommodate. (Claudio, supra, 134 Cal.App.4th at p. 243.)

Second, and more distinctively, Claudio recognizes a narrow but real exception to the rule that an employee must personally participate in the interactive dialogue. The general rule — no proxy through counsel — is reaffirmed, protecting employers from being forced to negotiate accommodations at arm’s length. (Id. at p. 247.) But the court holds that an employer cannot manufacture confusion (here, by telling an employee four times that he is already fired) and then insist on direct dealing as though nothing were amiss; an employer’s own destabilizing conduct can make an employee’s insistence on counsel reasonable enough to reach a jury. (Id. at pp. 247–248.) Equally instructive is the court’s treatment of McLean’s unilateral assumption: an employer agent who guesses at an attorney’s scope of representation, rather than asking, acts at the employer’s peril. (Id. at p. 248.) The decision’s reach is bounded by its posture — it decides only that triable issues exist, expressly leaving open whether an accommodation could in fact have been found. (Ibid.)

Key quotes

“The same reasoning applies to subdivision (n) of section 12940, the failure to engage in the interactive process. An employee may file a civil action based on the employer’s failure to engage in the interactive process.” (Claudio, supra, 134 Cal.App.4th at p. 243.)

“Although we conclude that ordinarily the employee cannot force the employer to go through the employee’s attorney for the interactive process, here there were unusual circumstances.” (Id. at p. 247.)

“A jury should decide the question whether the University failed to engage in the interactive process in good faith when it refused to communicate with plaintiff’s attorney.” (Id. at p. 248.)

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Practice pointer

Open questions

Whether an accommodation actually existed. Because the court found a triable issue on the interactive-process failure, it pointedly did not resolve whether a position could have been found: “since we conclude a triable issue exists concerning failure by the University to participate in the interactive process, it cannot be known whether an alternate job would have been found.” (Claudio, supra, 134 Cal.App.4th at p. 248.)

Whether the process would have been futile. The court left open the futility defense, holding only that “this is not a case (at least not yet) where it can be said an interactive process would have been futile,” because “it appears plaintiff may have been physically able to handle clerical positions.” (Claudio, supra, 134 Cal.App.4th at p. 249.)

The remaining count-one theories. Having found one triable issue sufficient to reverse, the court declined to reach Claudio’s other arguments on count one: “We need not address plaintiff’s other arguments regarding count one.” (Claudio, supra, 134 Cal.App.4th at p. 249.)

Whether FEHA claims are exempt from the grievance procedure. The court noted the Regents’ suggestion “that FEHA claims may be exempt from the grievance procedure,” but because Claudio did not address the point, the court “need not consider it.” (Claudio, supra, 134 Cal.App.4th at p. 251.)