Eva Vazquez v. Costco Wholesale Corporation, 2:21-cv-02563

Background

Plaintiff Eva Vazquez, a 20‑year Costco employee, alleges disability harassment under FEHA after taking two medical leaves and returning with work restrictions (e.g., not sweeping).
After her return, supervisors (including Eddie Robles) allegedly demanded she obtain doctor’s notes removing restrictions and said she needed to be “100% healed” to work; later she was placed on leave and told there was no job because of restrictions.
Plaintiff sued Costco and individual supervisors in California state court for disability harassment; defendants removed to federal court asserting fraudulent joinder of the California‑resident individual defendants to defeat diversity.
Plaintiff moved to remand and sought attorney’s fees; the Court ordered supplemental briefing on joinder and then considered the motion on the pleadings and deposition evidence.
The Court found a plausible FEHA harassment claim against at least one individual defendant (Robles), so fraudulent joinder was not established, remanded the case to state court, and denied attorney’s fees because removal was not objectively unreasonable.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether individual defendants were fraudulently joined	Vazquez: Costco failed to prove plaintiffs cannot state any claim against the Calif. individual defendants	Costco: Deposition shows harassment was not severe or pervasive; individuals were fraudulently joined to defeat diversity	Court: Fraudulent joinder not shown; at least one viable claim against Robles exists, so diversity lacking — remand granted
Whether Robles’ conduct can support a FEHA harassment claim	Vazquez: Robles’ demand to remove restrictions and statements about coworkers could convey an unwelcoming, harassing message	Costco: Statements occurred during a personnel/accommodation meeting and were not derogatory or objectively offensive	Court: Single incident can suffice under FEHA amendments; statements could be harassing or discriminatory; factual determination for trier of fact — claim plausible
Whether Plaintiff is entitled to fees under 28 U.S.C. § 1447(c)	Vazquez: Removal was improper and fees/costs should be awarded	Costco: Removal was reasonable given the record	Held: Denied — removal lacked merit but was objectively reasonable, so fee award inappropriate

Key Cases Cited

Hunter v. Philip Morris USA, 582 F.3d 1039 (9th Cir. 2009) (fraudulent‑joinder standard; court may ignore improperly joined defendants)
Hamilton Materials, Inc. v. Dow Chem. Co., 494 F.3d 1203 (9th Cir. 2007) (fraudulent joinder must be proven by clear and convincing evidence)
Gaus v. Miles, Inc., 980 F.2d 564 (9th Cir. 1992) (removal statute construed narrowly; burden on removing party)
Prize Frize, Inc. v. Matrix (U.S.) Inc., 167 F.3d 1261 (9th Cir. 1999) (removal proponent bears burden; strict construction against removal)
Roby v. McKesson Corp., 47 Cal.4th 686 (Cal. 2009) (harassment defined; personnel actions can support harassment claim when they send a harassing message)
Aguilar v. Avis Rent A Car Sys., Inc., 21 Cal.4th 121 (Cal. 1999) (harassment must be severe or pervasive to alter employment conditions, but statutory amendment permits single‑incident liability in some cases)
Meritor Savings Bank v. Vinson, 477 U.S. 57 (U.S. 1986) (hostile work environment standard)
McGregor v. Nat’l R.R. Passenger Corp., 187 F.3d 1113 (9th Cir. 1999) (policies requiring employees be “100% healed” can violate disability law)
Martin v. Franklin Capital Corp., 546 U.S. 132 (U.S. 2005) (standard for awarding fees on remand: objective reasonableness of removal)
Grancare, LLC v. Thrower ex rel. Mills, 889 F.3d 543 (9th Cir. 2018) (if there is any possibility state court would find claim adequate, fraudulent joinder is not established)
Bell v. City of Kellogg, 922 F.2d 1418 (9th Cir. 1991) (lack of subject matter jurisdiction requires dismissal regardless of local‑rule deficiencies)