Acosta v. Hilton Grand Vacations Company LLC
4:15-cv-00495
D.S.C.Sep 8, 2015Background
- Plaintiff Laura Acosta, a Latina/Italian woman over 40, worked for Hilton defendants for eight months and alleges discriminatory conduct, hostile work environment, and wrongful termination among other claims.
- At hire Acosta received a Code of Conduct, Team Member Handbook, and training; she alleges a progressive discipline policy (verbal, written warning before termination) communicated at orientation.
- Acosta signed a Handbook Acknowledgment stating at-will employment; the Handbook’s disclaimer does not meet the South Carolina statute’s conspicuity requirements.
- Defendants moved to dismiss the sixth (breach of employment contract), eighth (privacy), and tenth (breach of implied covenant) causes of action; Magistrate Judge recommended dismissal of the contract claim and partial dismissal of the privacy claim.
- District Court reviewed de novo Acosta’s objections and held the progressive-discipline-based breach claim survives dismissal; privacy claim dismissed only to the extent it sought relief for alleged HIPAA violations; implied-covenant claim dismissed with plaintiff’s consent.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the employee handbook/protocol created an enforceable contract altering at-will status (breach of employment contract) | Handbook and orientation created a binding progressive-discipline promise; termination without warnings breached that contract | Plaintiff was an at-will employee; handbook/disclaimer preserved at-will status and no enforceable promise exists | Court: denied dismissal as to breach claim based on alleged mandatory progressive discipline — plausible at motion-to-dismiss stage; breach claims premised on discrimination/hostile work environment dismissed (statutory remedies exist) |
| Whether privacy claim based on disclosure of medical records may proceed to the extent it alleges HIPAA violations | Privacy tort based on publication of medical records and photos | No private right of action under HIPAA; such claims must be dismissed to that extent | Court: dismissed privacy claim only insofar as it sought relief for alleged HIPAA violations; common-law privacy claim otherwise remains |
| Whether breach of implied covenant of good faith and fair dealing is viable | Plaintiff initially pleaded the claim | Defendants moved to dismiss | Plaintiff consented to dismissal; claim dismissed |
| Proper corporate defendants | Plaintiff named multiple Hilton corporate entities | Defendants argued only Hilton Grand Vacations Company, LLC employed plaintiff and others are improper | Court: dismissed Hilton Worldwide d/b/a Hilton Grand Vacations at Myrtle Beach, Hilton Resorts Corp., and Hilton Grand Vacations Management Co., Inc.; only Hilton Grand Vacations Company, LLC remains |
Key Cases Cited
- Mathews v. Weber, 423 U.S. 261 (1976) (standard for district court review of magistrate judge recommendations)
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for Rule 12(b)(6))
- Nemet Chevrolet, Ltd. v. Consumeraffairs.com, Inc., 591 F.3d 250 (4th Cir. 2009) (pleading standards; accept well-pled allegations)
- Hessenthaler v. Tri-County Sister Help, Inc., 616 S.E.2d 694 (S.C. 2005) (when handbook/disclaimer may create an employment contract; mandatory progressive discipline can be enforceable)
- Grant v. Mount Vernon Mills, Inc., 634 S.E.2d 15 (S.C. Ct. App. 2006) (elements for handbook to form contract: applies to employee, sets procedures binding on employer, lacks conspicuous disclaimer)
- Stiles v. Am. Gen. Life Ins. Co., 516 S.E.2d 449 (S.C. 1999) (general rule of at-will employment, narrow exceptions for handbook-created contracts)