656 F. App'x 841
9th Cir.2016Background
- Couch worked as a full-time Morgan Stanley Financial Advisor (FA) from 2007 to 2013; Morgan Stanley requires prior written approval for outside political or public-office activities.
- Morgan Stanley previously approved Couch’s intent to run for Kern County Board of Supervisors; in Feb 2012 Couch submitted a formal request describing the Supervisor role as paying $100,000 and requiring ~35 hours/week (25 during business hours).
- Morgan Stanley’s HR and Legal teams expressed concerns that the Supervisor role would conflict with Couch’s FA duties and posed a client conflict (Kern County being a Morgan Stanley client).
- Couch was elected June 2012 and sworn in December 2012; Morgan Stanley told him he could not hold both positions and demanded a choice; after Couch did not resign one position, Morgan Stanley terminated him in January 2013.
- Couch sued under Cal. Lab. Code §§ 98.6, 1101(a), and 1102 and for tortious interference; the district court granted summary judgment for Morgan Stanley, and Couch appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether §§ 1101(a) and 1102 prohibit termination of an employee who engages in political activity regardless of employer motive | Couch argued employer liability attaches whenever an employee is terminated for engaging in political activity | Morgan Stanley argued liability requires a political motive; here the termination was for a legitimate, non-political reason (inability to perform two full-time jobs) | Court held liability under §§1101/1102 requires a political motive; summary judgment for Morgan Stanley affirmed |
| Whether Couch’s factual evidence created a triable issue that the termination was politically motivated | Couch pointed to prior approval to run and timing of communications; suggested some FAs work remotely and are not monitored | Morgan Stanley relied on the Supervisor’s time demands and its treatment of FA as full-time, showing non-political business justification | Court found no genuine dispute of material fact: employer reasonably believed dual employment was incompatible; no political motive shown |
| Whether derivative claims (tortious interference and §98.6) survive absent §1101/1102 violation | Couch’s derivative claims depended on proving unlawful political termination | Morgan Stanley argued derivative claims fail if §§1101/1102 claims fail | Court held derivative claims fail because they were based on alleged violations of §§1101/1102 |
| Standard of review on summary judgment | Couch sought reversal of summary judgment | Morgan Stanley sought affirmance | Court applied de novo review and affirmed district court’s grant of summary judgment |
Key Cases Cited
- Lopez v. Smith, 203 F.3d 1122 (9th Cir. 2000) (standard for de novo review of summary judgment)
- Ryman v. Sears, Roebuck & Co., 505 F.3d 993 (9th Cir. 2007) (follow state intermediate appellate decisions absent convincing evidence state supreme court would rule differently)
- Gay Law Students Ass’n v. Pac. Tel. & Tel. Co., 595 P.2d 592 (Cal. 1979) (Cal. Labor Code §§1101–1102 protect employees’ political activity)
- Ali v. L.A. Focus Publ’n, 5 Cal. Rptr. 3d 791 (Ct. App. 2003) (holding §§1101/1102 require showing termination motivated by political activity)