91 Cal.App.5th 1100
Cal. Ct. App.2023Background
- Plaintiff Rafi Kourounian, a long‑time tax auditor, obtained a $425,562 jury verdict against the California Department of Tax and Fee Administration for retaliation under FEHA arising from internal EEO complaints he filed in March/April and May 2013.
- In March/April 2013 Kourounian filed an EEO complaint (and an April supplement) alleging age and race discrimination by supervisor Silva Saghbazarian; in May 2013 he filed a second EEO complaint alleging retaliation by supervisor Chiang.
- Kourounian’s discrimination claims were later waived in a settlement over a rescinded promotion, but the settlement preserved his right to pursue the March/April and May 2013 retaliation claims.
- At trial the court admitted (1) evidence of allegedly retaliatory acts that occurred before the March/April EEO filing, and (2) the text of the March/April and May EEO complaint documents into evidence; the Department objected on hearsay and relevance grounds.
- The jury returned a 9–3 verdict for Kourounian. On appeal the Department argued multiple evidentiary errors (including admission of pre‑complaint conduct and the EEO narratives) and that damages were speculative.
- The Court of Appeal reversed and remanded, holding the trial court abused its discretion by admitting evidence of acts predating the protected activity and by admitting the March/April EEO complaint and supplement (prejudicial hearsay). The court did not reach the Department’s other asserted errors.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Admissibility of conduct predating the March/April EEO complaint as evidence of retaliation | Prior conduct is part of the "totality of circumstances" and shows motive to retaliate | Retaliation requires adverse acts after protected activity; pre‑filing conduct cannot be retaliation and is irrelevant | Error: admission abused discretion; pre‑protected acts irrelevant to retaliation and their admission was prejudicial |
| Admissibility of the March/April and May EEO complaints (documentary evidence) | Complaints were plaintiff’s own statements, relevant for notice, state of mind, and motive | The complaints are out‑of‑court statements offered for their truth (hearsay), including multiple levels of hearsay; inadmissible | Error: March/April complaint and supplement admitted as hearsay without proper exception or limiting instruction; May complaint less prejudicial but admission of March/April was prejudicial |
| Prejudice from the admitted evidence and impact on verdict | The jury could weigh statements; any error was harmless | Admission of pre‑filing acts and the March/April narratives compounded evidence of a coordinated retaliatory scheme; close 9–3 verdict shows prejudice | Held prejudicial: reasonable probability of a different result absent the improperly admitted evidence; judgment reversed and remanded |
| Other evidentiary and damages challenges (scope of rebuttal testimony, evidence of failed promotions, speculative economic damages) | Testimony and evidence were proper rebuttal/ probative of damages | Trial court erred in allowing out‑of‑scope testimony, excessive evidence of failed promotions, and speculative damages | Not reached: court reversed on the admission/hearsay grounds and did not decide these additional contentions on the merits |
Key Cases Cited
- Yanowitz v. L’Oreal USA, Inc., 36 Cal.4th 1028 (2005) (retaliatory acts may be a series of related acts—court discussed "totality of the circumstances")
- Morgan v. Regents of Univ. of Cal., 88 Cal.App.4th 52 (2000) (elements of a prima facie retaliation claim require protected activity, subsequent adverse action, and causation)
- Nejadian v. County of Los Angeles, 40 Cal.App.5th 703 (2019) (actions taken before the protected activity are irrelevant to retaliation causation)
- People v. Sanchez, 63 Cal.4th 665 (2016) (defining hearsay and multiple‑level hearsay rules for documents and statements)
- People v. Seumanu, 61 Cal.4th 1293 (2015) (a testifying witness’s prior out‑of‑court statements are still hearsay if offered for their truth)
- Kotla v. Regents of Univ. of Cal., 115 Cal.App.4th 283 (2004) (assessing prejudice where jury verdict was 9–3 and evidence could support alternative inferences)
- Cassim v. Allstate Ins. Co., 33 Cal.4th 780 (2004) (standard for reversal for prejudicial error and assessing whether a different result was reasonably probable)