ESTHER KIM, Plaintiff, Cross-defendant, and Respondent, v. KONAD USA DISTRIBUTION, INC., et al., Defendants, Cross-complainants, and Appellants.
No. G048443
Fourth Dist., Div. Three
June 12, 2014
226 Cal. App. 4th 1336
Henry M. Lee and Michelle P. Tran for Defendants and Appellants.
Lee & Fields and Edward Y. Lee for Plaintiff and Respondent.
IKOLA, J.—Following a bench trial, the court awarded plaintiff Esther Kim $60,000 against her former employer, defendant Konad USA Distribution, Inc. (Konad), and her former boss, defendant Dong Whang. Defendants appeal, citing the alleged failure of plaintiff to meet certain “jurisdictional” prerequisites (e.g., exhaustion of administrative remedies, proving Konad had five employees) in her sexual harassment and wrongful termination claims. We affirm the judgment.
FACTS
Factual Background1
Plaintiff “started working for Konad in 2006 as an account manager. Her main duties were to process orders by phone and emails. Konad‘s business involved the distribution and sales of nail art kits. . . . Mr. and Mrs. Whang were actively involved in the operation of the business. Dong Whang was the CEO and sole shareholder. . . . [T]he business grossed about two million dollars in 2012.”
“In 2007 Plaintiff moved to La Habra to be closer to her job. . . . [I]t was about this time that Dong Whang commenced a pattern of sexually harassing Plaintiff. . . . [O]ver the next several years, Defendant Whang would regularly make comments to Plaintiff concerning sexual matters. He questioned Plaintiff about her sexual activities with her boyfriend, whether she used sex toys, and whether she did Kegel exercises. He would comment on other women‘s breasts and buttocks and would tell Plaintiff that hers were better. He also related stories about a friend that would have sex with women and then go home and have sex with his wife. On one occasion he suggested that Plaintiff sit on his lap, which offer Plaintiff declined. Whang asked her if she thought that Whang was trying to get her to go to bed with him. She responded that he was disgusting. At work their desks were across from each other and he would leer at her almost on a daily basis and stare at her breasts and legs. He related stories of monks and their small penises allegedly due to lack of use.
“Whang got into the habit of hugging Plaintiff and patting her on the buttocks. On a return motor trip from Las Vegas with only the two of them present, he placed his hand on her thigh. He came to her new apartment in La Habra with dinner and a bottle of vodka. Upon leaving the apartment he hugged Plaintiff for a bit longer than usual. At a trade show in Chicago he followed her to her room to allegedly retrieve some medication that had inadvertently been placed in an office bag that Plaintiff maintained. Upon leaving he gave her a very long hug which caused Plaintiff to start crying.”
“Plaintiff finally found the hostile environment so stressful that she wrote to Whang on November 12, 2010, that she would not be returning to work. Plaintiff claims that Whang had fired her by telling her to ‘take her last paycheck and go and make a lot of love with her boyfriend.’ Plaintiff was single, in her early twenties during this period of time and was quite attractive. On the other hand, Whang was pushing sixty and fairly plain-looking. Plaintiff testified that Whang volunteered to pay $500.00 a month for one year to help pay for Plaintiff‘s apartment rent. Whang asked that Plaintiff not tell his wife about these payments.”
Cathy “Lim worked at Konad for about fifteen months. [Lim] remained there for another three months after Plaintiff left. . . . Whang often talked [to Lim] about Plaintiff and sex in the same breath. He told Lim that he thought that Plaintiff‘s boyfriend was using her mainly for sex. He referred to Plaintiff as a slut. It was clear to Lim that Whang was obsessed with Plaintiff and Lim warned her to be careful with Whang, especially when they were alone. Plaintiff related to Lim many of the incidents described above.”
Procedural History
In July 2011, plaintiff filed a civil action against Konad and Whang. Plaintiff‘s complaint included four causes of action relevant to this appeal: (1) sexual harassment (quid pro quo); (2) sexual harassment (hostile work environment); (3) retaliation; and (4) wrongful termination in violation of public policy. The first three causes of action were pleaded under the California Fair Employment and Housing Act (FEHA;
The complaint alleged, “Plaintiff filed timely complaints against the Defendants with the [Department of Fair Employment and Housing (DFEH)] alleging sexual harassment and failure to prevent sexual harassment. Thereafter, Plaintiff received from the DFEH notification of her right to sue in the
Defendants answered the complaint in December 2011.2 The answer included an affirmative defense that plaintiff had failed to exhaust her administrative remedies as required by
Trial commenced in February 2013. Defense counsel‘s opening statement focused on the merits of the contentions at issue. Defense counsel did not claim plaintiff had failed to exhaust her administrative remedies under FEHA or that the court lacked jurisdiction to decide the causes of action pleaded in the complaint for any other reason. The record does not disclose the existence of any motions filed or argued during the trial by defendants to dismiss plaintiff‘s FEHA claims based on a failure to exhaust administrative remedies or an insufficient number of employees. Defense counsel‘s closing argument did not mention jurisdictional issues or the exhaustion of administrative remedies.
At the close of plaintiff‘s case-in-chief, defendants moved for judgment pursuant to
The only time the issue of exhaustion of administrative remedies was raised at trial was during the testimony of plaintiff. Defense counsel asked plaintiff whether she had filed a document with a government agency alleging sexual harassment; plaintiff replied, “No.” Defense counsel then led plaintiff to admit she had not produced “any document that was a complaint . . . alleging sexual harassment that [she] filed with any government agency. . . .” On redirect, plaintiff‘s counsel succeeded (over defendants’ objection that the
The notice from DFEH (exhibit No. 19), which referenced a matter number and a case name (ESTHER/WHANG, DONG, AS AN INDIVIDUAL) states in relevant part: “This letter informs that the above-referenced complaint that was filed with the [DFEH] has been closed effective January 24, 2011 because an immediate right-to-sue notice was requested. DFEH will take no further action on the complaint. [[] This letter is also the Right-To-Sue Notice. According to
After the close of evidence and argument, the court took the case under submission on February 20, 2013. The court issued a proposed statement of decision and judgment on February 27. Defendants objected to the statement of decision, including on the grounds that the court lacked jurisdiction because of the number of Konad‘s employees and plaintiff‘s alleged failure to exhaust administrative remedies.
The court filed an essentially unchanged statement of decision and judgment on March 15, 2013. The statement of decision indicated plaintiff carried her burden of proof with regard to all three remaining causes of action. The judgment awarded plaintiff $60,000; the award is in a single lump sum and is not differentiated by cause of action, defendant, or type of damage.
On March 19, 2013, defendants filed “supplemental” objections to the statement of decision, further exploring their contention that the court lacked jurisdiction because plaintiff did not prove she had exhausted her administrative remedies under FEHA by filing administrative complaints naming both defendants and raising the claims relied on in this litigation.
Plaintiff opposed the motion on several grounds, including waiver by defendants. Plaintiff also appended copies of documents showing she had in fact complied with jurisdictional prerequisites, including verified administrative complaints separately filed in January 2011 against both Konad and Whang. The allegations in these administrative complaints included termination, harassment, constructive discharge, retaliation, and failure to prevent harassment. This conduct was alleged to have occurred because of plaintiff‘s sex and marital status. Plaintiff specifically wrote that “the reasons for my discrimination were based upon my sex as a female. I suffered sexual discrimination and harassment and retaliation. In addition, I was constructively terminated because of my sex.” These form documents indicated that the submission of the complaints constituted a declaration under penalty of perjury that the facts attested to were true. Also appended to the opposition was a notice of case closure and right-to-sue notice specifically addressing the administrative complaint against Konad, to match the letter specifically referencing Whang introduced at trial as exhibit No. 19. Plaintiff‘s counsel obtained these documents by making a public records request with DFEH.
In their reply memorandum, defendants claimed it would be improper for the court to consider the documents appended to plaintiff‘s opposition to the motion because these documents were not admitted at trial, they were insufficiently authenticated, and there was no evidence the administrative complaints were “verified.”
The court denied the motion to set aside the judgment. The court rejected the notion that a FEHA complaint must be introduced into evidence to provide the court with jurisdiction to rule in a FEHA case. The court also noted that the introduction of exhibit No. 19 (the right-to-sue letter) was evidence of exhaustion.
DISCUSSION
On appeal, defendants contend the court lacked “jurisdiction” to enter judgment as it did on the FEHA sexual harassment causes of action because plaintiff failed to prove exhaustion of administrative remedies. As to the common law wrongful termination cause of action, defendant claims (1) there was no evidence Konad had five or more employees, and (2) Whang was not plaintiff‘s employer.
“FEHA creates an administrative agency, the DFEH, whose task it is to receive, investigate and conciliate complaints of unlawful employment discrimination [citations].” (Okoli v. Lockheed Technical Operations Co. (1995) 36 Cal.App.4th 1607, 1613 [43 Cal.Rptr.2d 57] (Okoli).) “Any person claiming to be aggrieved by an alleged unlawful practice may file with the department a verified complaint, in writing, that shall state the name and address of the person, employer, labor organization, or employment agency alleged to have committed the unlawful practice complained of, and that shall set forth the particulars thereof and contain other information as may be required by the department.” (
“Before filing a civil action alleging FEHA violations, an employee must exhaust his or her administrative remedies with DFEH.” (Wills v. Superior Court (2011) 195 Cal.App.4th 143, 153 [125 Cal.Rptr.3d 1].) Exhaustion includes the timely filing of administrative complaints addressing the claims and parties at issue, as well as the procurement of right-to-sue letters. (See Romano v. Rockwell Internat., Inc. (1996) 14 Cal.4th 479, 492 [59 Cal.Rptr.2d 20, 926 P.2d 1114].) Courts have referred to this requirement as a ” ‘jurisdictional prerequisite.’ ” (E.g., Johnson v. City of Loma Linda (2000) 24 Cal.4th 61, 70 [99 Cal.Rptr.2d 316, 5 P.3d 874] [“Exhaustion of administrative remedies is ‘a jurisdictional prerequisite to resort to the courts.’ “]; Okoli, supra, 36 Cal.App.4th at p. 1613 [“in the context of the FEHA, exhaustion of the administrative remedy is a jurisdictional prerequisite to resort to the courts . . .“].)
Moreover, it is “plaintiff‘s burden to plead and prove timely exhaustion of administrative remedies, such as filing a sufficient complaint with [DFEH] and obtaining a right-to-sue letter.” (Garcia v. Los Banos Unified School Dist. (E.D.Cal. 2006) 418 F.Supp.2d 1194, 1215, citing Westinghouse Elec. Corp. v. County of Los Angeles (1974) 42 Cal.App.3d 32, 37 [116 Cal.Rptr. 742] [taxpayer administrative exhaustion case]; see Chin et al., Cal.
The preceding black letter law is uncontroversial as far as it goes. What is less clear is what should happen if the issue of exhaustion of administrative remedies is basically ignored until after FEHA claims have been submitted to the fact finder for decision. Common sense dictates that most failure-to-exhaust issues do not involve triable questions of fact and will therefore be resolved by dispositive motions prior to trial. (See, e.g., Medix Ambulance Service, Inc. v. Superior Court (2002) 97 Cal.App.4th 109, 118 [118 Cal.Rptr.2d 249] [demurrer sustained as to defendants not named in DFEH administrative complaints]; Martin v. Lockheed Missiles & Space Co. (1994) 29 Cal.App.4th 1718, 1723-1725 [35 Cal.Rptr.2d 181] [grant of summary judgment affirmed based in part on failure to include claims in DFEH administrative complaint that were ultimately asserted in lawsuit].)3 As explained in the procedural history above, however, defendants took the road less travelled and waited until after the case was submitted for decision to raise their contentions about exhaustion of administrative remedies.
In their briefs, defendants misleadingly claim plaintiff “failed to exhaust her administrative remedies.” By our review of the record, the only reasonable inference is that plaintiff did exhaust her administrative remedies. She submitted verified complaints to DFEH, naming both defendants and covering the claims asserted in the lawsuit. As explained above, it does not matter that these documents were unsigned. (
But “jurisdictional prerequisite” does not mean subject matter jurisdiction in the context of exhaustion of administrative remedies. ” ‘The concept of jurisdiction embraces a large number of ideas of similar character, some fundamental to the nature of any judicial system, some derived from the requirement of due process, some determined by the constitutional or statutory structure of a particular court, and some based upon mere procedural rules originally devised for convenience and efficiency, and by precedent made mandatory and jurisdictional.’ ” (Mokler v. County of Orange (2007) 157 Cal.App.4th 121, 134 [68 Cal.Rptr.3d 568] (Mokler).) “Although earlier cases tended to view the exhaustion doctrine as invalidating a court‘s subject matter jurisdiction, thus allowing a defendant to raise it at any time [citations], later cases have generally conclude[d] a defendant waives the defense by failing to timely assert it.” (Id. at p. 135.) “[T]he administrative exhaustion requirement does not implicate the court‘s subject matter jurisdiction. It is ‘jurisdictional’ in the sense only that a court‘s failure to apply the rule is judicial error and can be corrected by issuance of a writ of prohibition.” (Chin et al., Cal. Practice Guide: Employment Litigation, supra, ¶ 16:252, pp. 16-36 to 16-37 (rev. # 1, 2013); see Mokler, supra, 157 Cal.App.4th at p. 136; Keiffer, supra, 65 Cal.App.4th at pp. 896-899.)
If a defendant timely presents the issue of whether a FEHA plaintiff has properly presented all claims to the DFEH, a court must decide the merits of this question. (Keiffer, supra, 65 Cal.App.4th at p. 900.) But ” ‘it would be grossly unfair to allow a defendant to ignore this potential procedural defense at a time when facts and memories were fresh and put a plaintiff to the time and expense of a full trial, knowing it could assert the failure to exhaust administrative remedies if it received an adverse [judgment].’ ” (Ibid.; see Mokler, supra, 157 Cal.App.4th at p. 136 [defendant waived exhaustion defense by “waiting to raise exhaustion until after a full trial on the merits“].)
Moreover, even if
Proof of Five Employees as Prerequisite to Wrongful Termination Claim
Next, defendants claim the court erred by finding them liable for wrongful termination in violation of public policy, the fourth cause of action in the complaint. This cause of action alleges plaintiff “was harassed based on her sex. Defendants failed to take proper action to protect Plaintiff. Defendants’ harassment created an intolerable working environment and he terminated Plaintiff after she refused to acquiesce to his advances. Plaintiff also complained regarding the harassment and was terminated. Plaintiff‘s wrongful termination from her employment was based upon Defendants’ violation of the Public Policy of the State of California as set forth in the Fair Employment Housing Act, the California Constitution, and other statutes and provisions.”
Although the fourth cause of action references FEHA as one source of the public policy at issue, this is not a statutory FEHA cause of action. FEHA does not displace or supplant common law tort claims for wrongful discharge. (See Stevenson v. Superior Court (1997) 16 Cal.4th 880, 885 [66 Cal.Rptr.2d 888, 941 P.2d 1157]; Rojo v. Kliger (1990) 52 Cal.3d 65, 70–71 [276 Cal.Rptr. 130, 801 P.2d 373].)
Nonetheless, defendants argue that because only employers with more than five employees are subject to FEHA (which defendants identify as the sole policy basis for plaintiff‘s claim), it was not against public policy for Konad to terminate plaintiff. “[T]he FEHA . . . limits the application of the act‘s enforcement provisions to employers of five or more persons. Thus, while the Legislature has made a broad statement of policy, it has not extended that policy to small employers.” (Jennings v. Marralle (1994) 8 Cal.4th 121, 130 [32 Cal.Rptr.2d 275, 876 P.2d 1074]; see
There are two problems with defendants’ argument. First, plaintiff‘s claim is based on sexual harassment rather than age discrimination.
Second, plaintiff‘s common law wrongful discharge claim was based on both FEHA and the California Constitution. In Rojo v. Kliger, supra, 52 Cal.3d 65, plaintiffs alleged sexual harassment by their employer ultimately resulting in tortious discharges in violation of public policy. (Id. at p. 71; id. at p. 89 [plaintiffs’ “refusal to tolerate that harassment or acquiesce in those demands resulted in the wrongful discharge of [one plaintiff] and the constructive wrongful discharge of” the other plaintiff].) The defendant employed fewer than five persons and was subject only to the sexual
Whang‘s Individual Liability for Wrongful Termination
Finally, Whang contends he should not be held liable for wrongful termination because Konad (not Whang) was plaintiff‘s employer. An action for wrongful termination in violation of public policy “can only be asserted against an employer. An individual who is not an employer cannot commit the tort of wrongful discharge in violation of public policy; rather, he or she can only be the agent by which an employer commits that tort.” (Miklosy v. Regents of University of California (2008) 44 Cal.4th 876, 900 [80 Cal.Rptr.3d 690, 188 P.3d 629].) This particular tort “is premised on the wrongful termination of an employment relationship. If an employer terminates an employment relationship for a reason that contravenes some fundamental public policy, then the employer breaches a general duty imposed by law upon all employers and the employee‘s remedy therefore sounds in tort.” (Ibid.) “[T]he breach of the employment relationship is an indispensable element of the tort, because it serves factually as the instrument of injury. Thus, there can be no [wrongful termination in violation of public policy] cause of action without the prior existence of an employment relationship between the parties.” (Ibid.) Although Whang‘s position as owner and chief executive officer of Konad is very different than the supervisors in the Miklosy case, we are bound to apply this clear rule established by our Supreme Court.
Plaintiff fails to respond to Whang‘s argument; her brief merely points out that an individual may be held liable for harassment under FEHA. Of course, Whang is not challenging his liability on the harassment causes of action, only the wrongful termination in violation of public policy cause of action.
We affirm the judgment, however. For one, it is unclear whether this issue was ever raised with the trial court in a timely fashion. Even assuming it was,
DISPOSITION
The judgment is affirmed. Plaintiff Esther Kim shall recover costs incurred on appeal.
Fybel, Acting P. J., and Thompson, J., concurred.
