Enoh et al v. Hewlett Packard Enterprise Company et al, No. 5:2017cv04212 - Document 61 (N.D. Cal. 2018)

Court Description: ORDER GRANTING 35 DEFENDANTS' MOTION TO DISMISS FOR IMPROPER VENUE, WITHOUT PREJUDICE; GRANTING IN PART WITHOUT PREJUDICE DEFENDANTS' REMAINING MOTION TO DISMISS AND MOTION TO STRIKE. Signed by Judge Beth Labson Freeman on 7/11/2018. (blflc2S, COURT STAFF) (Filed on 7/11/2018)
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1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 SAN JOSE DIVISION 7 8 ENOH I ENOH, ET AL., Plaintiffs, 9 13 ORDER GRANTING DEFENDANTS’ MOTION TO DISMISS FOR IMPROPER VENUE WITHOUT PREJUDICE; GRANTING IN PART WITHOUT PREJUDICE DEFENDANTS’ REMAINING MOTION TO DISMISS AND MOTION TO STRIKE 14 [Re: ECF 35] 10 11 United States District Court Northern District of California Case No. 17-cv-04212-BLF 12 v. HEWLETT PACKARD ENTERPRISE COMPANY, et al., Defendants. 15 16 This case involves alleged race and age discrimination in employment at technology giant 17 Hewlett-Packard, which spun-off into two separate entities in November 2015. Defendants HP 18 Inc. and Hewlett Packard Enterprise Company now move to dismiss this lawsuit, or transfer it to 19 the Northern District of Georgia where three of the named plaintiffs lived and worked, on the 20 grounds that venue in the Northern District of California is improper under 42 U.S.C. § 2000e- 21 5(f)(3). See generally ECF 35 (“Mot.”). 22 Plaintiffs oppose, arguing that venue is proper in this District where Defendants are 23 headquartered based on comments made by former Hewlett-Packard President and CEO Meg 24 Whitman. ECF 52-2 (“Opp’n”). Plaintiffs argue that Ms. Whitman’s comments, such as her 25 issuance of an alleged directive to managers nationwide “to make sure that we have a labor 26 pyramid with lots of young people coming in right out of college and graduate school and early in 27 their careers,” evidence an overarching plan to discriminate against older workers at HP Inc. and 28 Hewlett Packard Enterprise Company. Exh. 9 to Plaintiffs’ Request for Judicial Notice, ECF 53-9. Defendants also move to dismiss Plaintiffs’ claims on the merits and move to strike the 1 2 class allegations. The Court held a hearing on Defendants’ combined motion on May 31, 2018. 3 For the reasons that follow, the Court GRANTS Defendants’ motion to dismiss for improper 4 venue and GRANTS IN PART the remainder of Defendants’ motion to dismiss and motion to 5 strike. Accordingly, Plaintiffs’ claims are DISMISSED WITHOUT PREJUDICE to re-filing this 6 action in a district where venue is proper under § 2000e-5(f)(3). I. 7 BACKGROUND1 Plaintiffs Enoh I. Enoh (“Mr. Enoh”), Christopher Jackson (“Mr. Jackson”), Derek Mobley 9 (“Mr. Mobley”) and William Murrell (“Mr. Murrell”) (collectively “Plaintiffs”) bring this putative 10 class and collective action against Defendants HP Inc. (“HP Inc.”) and Hewlett Packard Enterprise 11 United States District Court Northern District of California 8 Company (“HPE”) (collectively, “Defendants”) to challenge Defendants’ employment practices 12 that allegedly discriminate against African-American employees and applicants over the age of 40. 13 See Second Amended Complaint (“SAC”), ECF 30. Specifically, Plaintiffs allege that Defendants 14 engaged in race and age discrimination in hiring, promotions, and lay-offs in violation of Title VII 15 of the Civil Rights Act of 1964 (“Title VII”), 42 U.S.C. § 1981, and the Age Discrimination in 16 Employment Act (“ADEA”). Id. ¶¶ 85-103. 17 Although Plaintiffs filed this case in the Northern District of California, and Defendants 18 are headquartered in Palo Alto, California, none of the named Plaintiffs resided in California or 19 worked for either Defendant in California during the relevant class period. Id. ¶¶ 6-11. All four of 20 the named Plaintiffs are African-American males over the age of 40. Id. ¶¶ 6-9. A. 21 Plaintiff Enoh Mr. Enoh alleges that he is a resident of Maryland and worked for “HP” from 1996 until he 22 23 was terminated on May 26, 2017. Id. ¶ 6. 2 Although not alleged by Plaintiffs, Defendants 24 provide evidence that Mr. Enoh worked for HPE in Maryland at all times after Hewlett-Packard 25 26 27 28 1 Plaintiffs’ factual allegations are taken from the operative Second Amended Complaint and are accepted as true for purposes of a motion to dismiss. See Reese v. BP Exploration (Alaska) Inc., 643 F.3d 681, 690 (9th Cir. 2011). 2 As discussed below, Plaintiffs fail to differentiate between the legally distinct entities HP Inc. and HPE in their Second Amended Complaint, which requires amendment. See generally SAC. 2 reorganized in November 2015. See Declaration of Cindy Beene (“Beene Decl.”) ¶ 3, ECF 35-3.3 2 Mr. Enoh’s last held position was Field Services Engineer. SAC ¶ 6. Prior to Mr. Enoh’s 3 termination, Plaintiffs allege that on or about February 1, 2017, Mr. Enoh was demoted and moved 4 to another reporting structure. Id. ¶ 32. Plaintiffs allege that Mr. Enoh immediately raised 5 concerns about the demotion and discrimination on his previous team with his new manager, but 6 “nothing was done about it.” Id. As late as March 16, 2017, Mr. Enoh emailed his direct manager, 7 a Caucasian male, and complained that he was being treated less advantageously than his 8 Caucasian and/or younger counterparts. Id. ¶ 35. Mr. Enoh’s manager, Paul Edinger, was also 9 based in Maryland. See Beene Decl. ¶ 4. Mr. Enoh was terminated in May 2017 and was told that 10 his separation from HPE was due to “restructuring,” although he alleges on information and belief 11 United States District Court Northern District of California 1 that he was the only individual on his team let go. SAC ¶ 39. Defendants provide evidence that 12 the HPE manager who selected Mr. Enoh for workforce reduction, Michael Yadron, was based in 13 Florida at the time of that decision. See Beene Decl. ¶ 5. Plaintiffs allege that Mr. Enoh filed a charge of discrimination with the Baltimore Field 14 15 Office of the United States Equal Employment Opportunity Commission (“EEOC”) on June 26, 16 2017. SAC ¶ 12. Defendants provide copies of Plaintiffs’ EEOC charges, which are incorporated 17 by reference into the SAC. See Declaration of Jeffrey J. Mann (“Mann Decl.”), ECF 35-2. 18 According to these documents, Mr. Enoh’s EEOC charge was filed on July 28, 2017. See Exh. E 19 to Mann Decl. As a result of his termination from employment, Mr. Enoh brings claims for race 20 discrimination against Defendants in violation of Title VII and Section 1981 (Counts 1 and 2) as 21 well as intentional discrimination and disparate impact age discrimination claims pursuant to the 22 ADEA (Counts 3 and 4). SAC ¶¶ 25-47. B. 23 Plaintiff Jackson Mr. Jackson also alleges that he was terminated from his decades-long employment at HP 24 25 26 27 28 3 The Court may properly consider Defendants’ evidence for purposes of their motion to transfer venue only. See Murphy v. Schneider Nat’l, Inc., 362 F.3d 1133, 1137 (9th Cir. 2004) (finding that in a motion made pursuant to Federal Rule of Civil Procedure 12(b)(3), “the pleadings need not be accepted as true and the court may consider facts outside of the pleadings.”) 3 1 as a result of age and race discrimination. Mr. Jackson is a resident of Atlanta, Georgia who 2 worked for HP Inc. in Georgia from July 15, 1996 to July 18, 2016 with the last held position of 3 District Manager. SAC ¶ 7; Declaration of Kim Ortolani (“Ortolani Decl.”) ¶ 3, ECF 35-4. 4 In 2014, Mr. Jackson alleges that he became aware of the promotion of two Caucasian 5 male employees, who were promoted without the positions being posted for open-bid. SAC ¶ 50. 6 Plaintiffs allege that prior to 2015, Mr. Jackson always received satisfactory performance 7 evaluations and his career at HP had been exemplary. Id. ¶ 49. In late 2015, Mr. Jackson was 8 rated as only “Partially Achieved” which meant he did not meet his performance goals for the 9 rating period. Id. ¶ 53. In November 2015, Mr. Jackson did not get the chance to compete for the position of Manager for all District Managers due to his low rating which precluded him from 11 United States District Court Northern District of California 10 applying. Id. ¶ 54. The job went to a Caucasian employee. Id. 12 Subsequently, Mr. Jackson alleges that he and other African-American District Managers 13 requested that HP provide them with additional resources in the form of personnel to meet the 14 demands of their territories. Id. ¶ 55. Each of their requests was denied. Id. In contrast to the 15 experience of African-American employees, Plaintiffs allege that Caucasian District Managers 16 who made the same requests received additional resources in the form of personnel. Id. Plaintiffs 17 allege that this caused the African-American managers to miss their production goals while the 18 Caucasian employees met theirs. Id. 19 Mr. Jackson alleges that on June 29, 2016, he complained to HP that he was being 20 discriminated against because of his race. Id. ¶ 56. Mr. Jackson never received any response 21 regarding his complaint of discrimination, however, he alleges that he was terminated from HP on 22 July 18, 2016—less than one month after his complaint. Id. Like Mr. Enoh, Mr. Jackson was 23 informed that his separation was due to restructuring, although he alleges that he was the only 24 individual in his department let go despite his superior or at least equal performance to that of his 25 Caucasian and/or younger counterparts. Id. ¶ 57. Mr. Jackson alleges that the workforce 26 reduction that he was selected for by his final manager, Thomas Medforth, was discriminatory. 27 SAC ¶¶ 50-57. Mr. Medforth worked for HP Inc. in Missouri and Arkansas at all relevant times. 28 Ortolani Decl. ¶ 4. 4 According to the documents submitted by Defendants, which are either incorporated by 1 2 reference into the complaint or public records that are proper subjects of judicial notice, Mr. 3 Jackson filed his first EEOC charge of discrimination against HP Inc. on August 22, 2016. See 4 Exh. A to Mann Decl. In this initial charge, Mr. Jackson alleged that he was discriminated against 5 and terminated by his supervisor on the basis of his race, and in retaliation for his complaints of 6 racial discrimination. Id. On September 14, 2016, Mr. Jackson amended his charge of 7 discrimination, claiming that he was discriminated against based on his age in addition to his race. 8 See Exh. B to Mann Decl. In both of his charges, Jackson alleged that the earliest instance of 9 discrimination occurred on or before June 29, 2016. Id. In the SAC, Mr. Jackson asserts race discrimination in violation of Title VII and Section 10 United States District Court Northern District of California 11 1981, as well as age discrimination in violation of the ADEA under both intentional discrimination 12 and disparate impact theories. See SAC ¶¶ 48-61. C. 13 Plaintiff Mobley4 14 Plaintiff Mobley is a resident of Atlanta, Georgia who began working for HPE in 15 November 2016 as a contract employee in Georgia. SAC ¶¶ 8, 62; Beene Decl. ¶ 6. Mr. Mobley 16 was part of a training class for Advanced Solutions Engineers made up of contract workers who 17 were trying to gain permanent employment with HP. SAC ¶ 63. Upon entering the training 18 program, Mr. Mobley and other members were informed by HP representatives that they would 19 transition to full-time employment at HP within 4 to 6 months if their performance was 20 satisfactory. Id. Around April 2017, however, HP announced that they were instituting a hiring 21 freeze which they communicated to the training class via a town hall meeting. Id. ¶ 64. 22 Mr. Mobley’s training class of contract employees was made up of approximately 23 seventeen individuals: fourteen African-Americans, two Caucasians, and one Turkish-American. 24 Id. Later in April 2017, Mr. Mobley alleges that he learned that the only remaining Caucasian 25 contract worker in the training class was hired as a full-time employee despite the alleged hiring 26 freeze. Id. ¶ 65. When Mr. Mobley inquired as to whether there were any other positions that had 27 4 28 Mr. Mobley was added as a plaintiff upon the filing of the Second Amended Complaint on September 29, 2017 to support Plaintiffs’ claim against Defendants for failure to hire. 5 1 become “unfrozen,” he was instructed to visit HP’s website. Upon visiting the website, Mr. 2 Mobley alleges that he applied for approximately seven open positions at HP, including the job he 3 is currently performing. Id. Mr. Mobley alleges that each of his applications has been rejected 4 despite his satisfactory performance rating. Id. ¶ 66. 5 On July 27, 2017, Mr. Mobley filed an EEOC charge of discrimination against Defendants. 6 See Exh. D to Mann Decl.; see also SAC ¶ 14. The charge alleges that Mr. Mobley was not hired 7 because of his race, with the earliest alleged discrimination taking place in April 2017. See Exh. D 8 to Mann Decl. As it pertains to the SAC, Mr. Mobley asserts claims of race discrimination in 9 hiring based on theories of intentional discrimination and disparate impact in violation of Title VII 10 United States District Court Northern District of California 11 and Section 1981. SAC ¶¶ 62-72. D. Plaintiff Murrell 12 Mr. Murrell is a resident of Atlanta, Georgia, and a current employee of HP Inc. in 13 Georgia. See SAC ¶ 9; Ortolani Decl. ¶ 5. Mr. Murrell began his career as a contract employee at 14 Hewlett-Packard in or around 2000, and became a full-time employee in 2007. SAC ¶ 9. Mr. 15 Murrell is currently a Field Service Support Representative. SAC ¶ 9. Mr. Murrell alleges that 16 promotions were announced on January 26, 2017, with seventeen individuals chosen for 17 promotion. Id. ¶ 79. Mr. Murrell was not promoted and did not even receive an interview. Id. 18 After learning of these promotions, Mr. Murrell alleges that he lodged a complaint with HP’s 19 Human Resource department in Palo Alto, California. Id. ¶ 80. In response, a Caucasian male 20 Human Resource official at HP stated that the manager’s reasons for not promoting Mr. Murrell 21 were valid and reasonable. Id. Mr. Murrell alleges that Eric Stevenson made the decision not to 22 promote him. See SAC ¶¶ 73-80. At all relevant times, Stevenson worked for HP Inc. in Florida. 23 See Ortolani Decl. at ¶ 6. 24 On June 23, 2017, Mr. Murrell filed a charge of discrimination with the EEOC’s Atlanta 25 Field Office. SAC ¶ 15. In his charge, Mr. Murrell stated that he was not promoted by his 26 manager due to his race, with the earliest instance of alleged discrimination taking place on 27 January 26, 2017—the day he was not promoted. See Exh. C to Mann Decl. In the SAC, Mr. 28 Murrell brings claims for race discrimination in promotion in violation of Title VII and Section 6 1 1981, based on theories of both intentional discrimination and disparate impact. SAC ¶¶ 73-84. E. 2 General Allegations of Race and Age Discrimination In addition to the specific experiences of each named Plaintiff, the SAC includes a number 3 4 of general allegations regarding HP Inc. and HPE’s employment practices. See, e.g., SAC ¶ 2. 5 Plaintiffs allege that “HP intentionally restricted and excluded African-Americans from higher 6 paying and higher responsibility positions by preventing and/or discouraging them from seeking 7 any such positions.” Id. ¶ 2(a). Moreover, Plaintiffs describe how HP allegedly allowed an 8 overwhelmingly Caucasian group of selectors to use a “hazy” selection process for its employment 9 decisions. Id. ¶¶ 2(b), 68, 91. This process allegedly disparately impacted African-American employees because it allowed subjectivity and favoritism to influence employment decisions. Id. 11 United States District Court Northern District of California 10 Plaintiffs further allege that HP went against its own non-discriminatory hiring policies by not 12 posting all open positions and instead relying on a “tap on the shoulder” procedure to award 13 higher paying and more prestigious jobs to Caucasian employees. Id. ¶¶ 2(c), 67. With regard to their age discrimination claims, Plaintiffs allege that HP initiated a 14 15 “Workforce Reduction Plan” or “WRP” that was aimed at making the company younger. Id. 16 ¶ 2(d). Plaintiffs allege that the WRP was a “facially neutral” job shedding process that 17 disparately impacted HP’s workforce over the age of forty. Id. According to Plaintiffs, HP 18 willfully and intentionally discriminated against older employees by dismissing them for 19 “phantom” performance issues or as part of the WRP. Id. ¶ 2(e). As discussed further below, and although not included in the SAC, Plaintiffs rely on public 20 21 statements made by Hewlett-Packard’s then President and CEO Meg Whitman regarding the 22 company’s Workforce Reduction Plan. See Opp’n at 3-6, ECF 52-2.5 On October 9, 2013, during 23 a Hewlett-Packard Securities Analyst Meeting, Ms. Whitman stated the following regarding the 24 next generation of IT professionals: 25 26 5 27 28 In November 2015, when Hewlett-Packard split into HPE and HP Inc., former Hewlett-Packard President and CEO Meg Whitman became the Chairman of the Board of HP Inc. and the CEO of HPE. See SAC ¶ 11; see also Exh. 8 to Plaintiffs’ Request for Judicial Notice, ECF 53-8. 7 3 So, as we think about our overall labor pyramid at HewlettPackard, we need to return to a labor pyramid that really looks like a triangle where you have a lot of early career people who bring a lot of knowledge who you’re training to move up through your organization, and then people fall out either from a performance perspective or whatever. 4 *** 1 2 5 6 7 8 9 And over the years, our labor pyramid doesn’t look -- has become not a triangle. It’s become a bit more of a diamond. And we are working very hard to recalibrate and reshape our labor pyramid so that it looks like the more classical pyramid that you should have in any company and particularly in ES. If you don’t have a whole host of young people who are learning how to do delivery or learning how to do these kinds of things, you will be in real challenges. 10 *** United States District Court Northern District of California 11 12 13 14 Now, that’s not something that changes like that. Changing the same shape of your labor pyramid takes a couple of years, but we are on it, and we’re amping up our early career hiring, our college hiring. And we put in place an informal rule to some extent which is, listen, when you are replacing someone, really think about the new style of IT skills. 15 16 17 18 19 20 See Exh. 4 to Plaintiffs’ Request for Judicial Notice, ECF 53-4. Nearly two years later, on November 2, 2015, Ms. Whitman gave an interview with CNBC’s David Faber, who asked her about HPE’s recently announced job cuts. See Exh. 9 to Plaintiffs’ Request for Judicial Notice, ECF 53-9. The transcript of the interview provides: 22 Faber: Still with a quarter of a million people work the company, you did announce significant job cuts about a month or so ago, when you gave—or maybe a bit more, six weeks—when you gave us more details. Is that going to be it for HPE? 23 *** 24 Whitman: That should be it. I mean, that will allow us to right size our enterprise services business to get the right onshore/offshore mix, to make sure that we have a labor pyramid with lots of young people coming in right out of college and graduate school and early in their careers. That’s an important part of the future of the company. So, it should be the last that we see. And you know, this will take another couple of years and then we should be done. 21 25 26 27 28 8 1 Id. As discussed below, Plaintiffs argue that Ms. Whitman’s comments reflect Defendants’ 2 overarching plan to get rid of older workers, which originated at HP headquarters in Palo Alto, 3 California, and the effects of its implementation were felt nationwide—including by Plaintiffs 4 Enoh in Maryland and Jackson in Georgia. See Opp’n at 15.6 II. 5 LEGAL STANDARD A. 6 Improper Venue 7 A defense of improper venue may be raised by motion under Federal Rule of Civil 8 Procedure 12(b)(3). When venue is improper, the court “shall dismiss, or if it be in the interest of 9 justice, transfer such case to any district or division in which it could have been brought.” 28 U.S.C. § 1406(a). The plaintiff bears the burden of showing that venue is proper. See Piedmont 11 United States District Court Northern District of California 10 Label Co. v. Sun Garden Packing Co., 598 F.2d 491, 496 (9th Cir. 1979) (“Plaintiff had the 12 burden of showing that venue was properly laid in the Northern District of California.”). “When 13 the plaintiff asserts multiple claims, it must establish that venue is proper as to each claim.” Kaia 14 Foods, Inc. v. Bellafiore, 70 F. Supp. 3d 1178, 1183 (N.D. Cal. 2014). “However, where venue 15 exists for the principal claim, federal courts will also adjudicate closely related claims, even if 16 there is no independent source of venue for the related claims.” Id. 17 In ruling on a motion to dismiss based on improper venue, “the allegations in the 18 complaint need not be accepted as true and the Court may consider evidence outside the 19 pleadings.” eBay Inc. v. Digital Point Sols., Inc., 608 F. Supp. 2d 1156, 1161 (N.D. Cal. 2009) 20 (citing Murphy v. Schneider Nat’l, Inc., 362 F.3d 1133, 1137 (9th Cir. 2004)). Whether to dismiss 21 for improper venue, or alternatively to transfer venue to a proper court, is a matter within the 22 sound discretion of the district court. King v. Russell, 963 F.2d 1301, 1304 (9th Cir.1992). B. 23 Failure to State a Claim “A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) for failure to state a 24 25 claim upon which relief can be granted ‘tests the legal sufficiency of a claim.’” Conservation 26 Force v. Salazar, 646 F.3d 1240, 1241–42 (9th Cir. 2011) (quoting Navarro v. Block, 250 F.3d 27 6 28 Only Plaintiffs Enoh and Jackson assert age discrimination claims against Defendants. Plaintiffs Murrell and Mobley bring race discrimination claims only. 9 1 729, 732 (9th Cir. 2001) ). When determining whether a claim has been stated, the Court accepts 2 as true all well-pled factual allegations and construes them in the light most favorable to the 3 plaintiff. Reese v. BP Exploration (Alaska) Inc., 643 F.3d 681, 690 (9th Cir. 2011). 4 However, the Court need not “accept as true allegations that contradict matters properly 5 subject to judicial notice” or “allegations that are merely conclusory, unwarranted deductions of 6 fact, or unreasonable inferences.” In re Gilead Scis. Sec. Litig., 536 F.3d 1049, 1055 (9th Cir. 7 2008) (quoting Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001) ). While a 8 complaint need not contain detailed factual allegations, it “must contain sufficient factual matter, 9 accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007) ). A claim is 11 United States District Court Northern District of California 10 facially plausible when the alleged facts “allow[ ] the court to draw the reasonable inference that 12 the defendant is liable for the misconduct alleged.” Id. 13 14 III. REQUESTS FOR JUDICIAL NOTICE Before turning to the parties’ arguments regarding proper venue and the adequacy of 15 Plaintiffs’ claims, the Court addresses the parties’ requests for judicial notice. The Court may 16 generally consider matters properly subject to judicial notice. See Tellabs, Inc. v. Makor Issues & 17 Rights, Ltd., 551 U.S. 308, 322 (2007). In support of their motion, Defendants filed a Request for 18 Judicial Notice of the pleadings in Forsyth, et al. v. HP Inc., et al., Case No. 5:16-cv-04775-EJD. 19 See ECF 35-1. Defendants’ request for judicial notice is GRANTED, as the documents are 20 matters of public record and Plaintiffs do not dispute the documents’ authenticity. Fed. R. Evid. 21 201; Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006). Although 22 the Court accepts these documents as public filings, specific facts and legal conclusions set forth 23 in the documents may not bind this Court. 24 In support of their opposition, Plaintiffs request that the Court take judicial notice of the 25 following documents: (1) HP Press Release dated May 23, 2012; (2) HP Form 8-K dated May 23, 26 2012; (3) HP Workforce Reduction Plan; (4) HPQ-Hewlett-Packard Securities Analyst Meeting 27 October 9, 2013; (5) HP Form 8-K dated May 22, 2014; (6) HP Form 8-K dated October 6, 2014; 28 (7) HP Form 8-K dated September 14, 2015; (8) HP Form 8-K dated October 31, 2015; (9) CNBC 10 1 Transcript of CEO & HP Inc. Chairman Meg Whitman Interview. See ECF 53. Defendants 2 concede that the Court may take judicial notice of press releases, news articles, and SEC filings for 3 their existence, but Defendants oppose Plaintiffs’ request to the extent they request the Court to 4 assume the truth of the matters contained in these documents. See ECF 55 (“Reply”) at 13. The Court GRANTS Plaintiffs’ request for judicial notice of these public records with 5 respect to their existence and what was in the public domain, but the Court does not take judicial 7 notice for the truth of their contents. See Von Saher v. Norton Simon Museum of Art, 592 F.3d 8 954, 960 (9th Cir. 2009) (“Courts may take judicial notice of publications introduced to indicate 9 what was in the public realm at the time, not whether the contents of those articles were in fact 10 true”). Moreover, the Court does not consider these materials with respect to the adequacy of 11 United States District Court Northern District of California 6 Plaintiffs’ claims in the SAC. Rather, the Court considers the material—including Ms. Whitman’s 12 statements—only as it pertains to whether venue is proper in this District. 13 14 IV. DISCUSSION In response to the filing of Plaintiffs’ operative SAC, Defendants filed a combined motion 15 to (1) dismiss or transfer the case for lack of proper venue; (2) dismiss Plaintiffs’ age 16 discrimination claims pursuant to the first-to-file rule in light of an earlier filed case Forsyth, et. al 17 v. HP Inc., et al.; (3) dismiss all claims pursuant to Federal Rules of Civil Procedure 12(b)(1) and 18 12(b)(6); and (4) strike Plaintiffs’ class allegations on the grounds that the class definitions are 19 temporally overbroad and exceed the applicable statute of limitations. See generally Mot. 20 The Court addresses Defendants’ motion to dismiss or transfer for improper venue, and 21 finds that it is dispositive. The Court then briefly addresses the remaining issues raised in 22 Defendants’ motion, consistent with the discussion on the record at the May 31, 2018 hearing. 23 24 A. Improper Venue At the outset, Defendants move to dismiss this case without prejudice, or transfer it to the 25 Northern District of Georgia, on the grounds that venue in the Northern District of California is 26 improper under 42 U.S.C. § 2000e-5(f)(3). See Mot. at 10. Discrimination claims brought under 27 Title VII are subject to special venue requirements, rather than governed by the general federal 28 venue statute. 42 U.S.C. § 2000e-5(f)(3); see also Johnson v. Payless Drug Stores Nw., Inc., 950 11 F.2d 586, 587 (9th Cir. 1991).7 The ADEA has no specific venue provision, and courts have held 2 that “when a plaintiff brings a Title VII action, which is covered by Title VII’s restrictive venue 3 provision, as well as an action governed by the general venue provision, the narrower venue 4 provision of § 2000e–5(f)(3) controls.” Walker v. U.S. Dep’t of Commerce, No. 1:11-CV-01195 5 AWI, 2012 WL 1424495, at *8 (E.D. Cal. Apr. 24, 2012) (citing Dehaemers v. Wynne, 522 6 F.Supp.2d 240, 249 (D.D.C. 2007)); see also Johnson, 950 F.2d at 587–88 (“[G]iven the conflict 7 between the two statutes, well settled principles of statutory construction dictate that the later, 8 specific venue provision (section 2000e–5(f)(3)) applies rather than the earlier, general venue 9 provision (section 1391(b)).”). Plaintiffs agree that Title VII’s special venue provision governs 10 their ADEA claims as well. See Opp’n at 11 n.3. Accordingly, the Court finds that Plaintiffs’ 11 United States District Court Northern District of California 1 claims in the SAC are subject to the venue requirements of Title VII. Title VII’s venue provision provides that an action “may be brought in any judicial district 12 13 in the State in which the unlawful employment practice is alleged to have been committed, in the 14 judicial district in which the employment records relevant to such practice are maintained and 15 administered, or in the judicial district in which the aggrieved person would have worked but for 16 the alleged unlawful employment practice[.]” 42 U.S.C.A. § 2000e-5(f)(3) (West). “[I]f the 17 respondent is not found within any such district, such an action may be brought within the judicial 18 district in which the respondent has his principal office.” Id. Title VII’s broad venue provision 19 only “seeks to limit venue to the judicial district concerned with the alleged discrimination.” 20 Passantino v. Johnson & Johnson Consumer Prod., Inc., 212 F.3d 493, 504 (9th Cir. 2000) 21 (internal quotation marks omitted). Defendants argue that Plaintiffs have failed to carry their burden to establish that venue in 22 23 the Northern District of California is proper for any of their claims. See Mot. at 11. Applying 24 25 26 27 28 7 Throughout their opposition, Plaintiffs argue that venue for Title VII claims is jointly governed by § 2000e-5(f)(3) and 28 U.S.C. § 1404(a). Opp’n at 11-13. Plaintiffs have conflated a motion to dismiss for improper venue pursuant to Rule 12(b)(3) and a motion to transfer venue based on convenience under 28 U.S.C. § 1404. Accordingly, Plaintiffs’ arguments directed toward the § 1404(a) factors are misplaced. The Court need only turn to the § 1404 analysis in the event it finds that venue is proper in this District under Title VII. 12 1 Title VII’s venue provision, Defendants argue that (1) Plaintiffs have not shown that Plaintiffs 2 worked or would have worked in this District; (2) Plaintiffs’ employment records are maintained 3 electronically and are not located in this District; and (3) the alleged unlawful employment 4 practices occurred outside of California. Id. at 11-14. The Court addresses Defendants’ 5 arguments directed at each prong of the venue provision in turn. 1. 6 7 Where Aggrieved Person Would Have Worked The Ninth Circuit has made clear that “the effect of Title VII’s venue provision is to allow 8 suit in the judicial district in which the plaintiff worked or would have worked.” Passantino, 212 9 F.3d at 504-05. The Court finds that the allegations in the SAC and the evidence provided by Defendants make clear that none of the named Plaintiffs worked for, or would have worked for, 11 United States District Court Northern District of California 10 either Defendant in California. Mr. Enoh worked for HPE in Maryland. See SAC ¶¶ 6; Beene 12 Decl. ¶ 3. Mr. Jackson worked for—and Mr. Murrell currently works for—HP Inc. in Georgia. 13 SAC ¶¶ 7, 9; see also Ortolani Decl. ¶¶ 3, 5. Mr. Mobley worked as an independent contractor at 14 HPE in Georgia, and Defendants argue that he alleges no facts to demonstrate that he would have 15 worked for either Defendant in California. See Mot. at 12. 16 Plaintiffs concede that none of the named Plaintiffs live or work in this District. Rather, 17 Plaintiffs argue that whether a plaintiff lives or works within a district in not dispositive of venue, 18 and direct their arguments at the remaining prongs of § 2000e-5(f)(3). See Opp’n at 14 (citing 19 Richardson v. Alabama State Bd. of Educ., 935 F.2d 1240, 1248 (11th Cir. 1991). Accordingly, 20 the Court finds that Plaintiffs have not shown that venue is proper in the Northern District of 21 California based on where the aggrieved person would have worked but for the alleged unlawful 22 employment practice. 23 24 2. Where Employment Records are Maintained and Administered Venue under Title VII is also proper in the judicial district in which the employment 25 records relevant to an alleged discriminatory practice are maintained and administered. See 42 26 U.S.C.A. § 2000e-5(f)(3). Plaintiffs allege that “HP maintains personnel records” in this District 27 and “the persons responsible for overseeing the human resources function are here.” SAC ¶ 5. 28 However, Defendants have presented uncontroverted evidence that both HP Inc. and HPE 13 1 maintain their employment records electronically, and therefore the employment records of 2 Plaintiffs Jackson, Murrell, and Enoh and any applicant records of Mr. Mobley are maintained 3 electronically and are not physically located in any particular state, including California. See 4 Ortolani Decl. ¶ 8; Beene Decl. ¶ 7. 5 Plaintiffs argue that even if their employment records are electronically accessible in 6 multiple districts, the Northern District of California is the proper venue under 42 U.S.C. § 2000e- 7 5(f)(3). Opp’n at 16. The Court disagrees. Mere access to electronic records is not sufficient to 8 establish venue. See Kim v. McHugh, No. 13-00616 JMS-KSC, 2014 WL 1580614, at *3 9 (D. Haw. April. 18, 2014) (“the mere electronic accessibility of the ‘master set’ of records from other districts does not provide an adequate basis for venue.”) This Court is in complete 11 United States District Court Northern District of California 10 agreement with the McHugh court, which explained: “given that electronic records are accessible 12 anywhere, to accept Plaintiff’s proposition would mean that she could bring her action 13 in any district she sees fit, rendering § 2000e–5(f)(3) meaningless. No court has accepted such a 14 broad interpretation of § 2000e–5(f)(3), and this court rejects it as well. The court therefore 15 concludes that the second prong of § 2000e–5(f)(3) does not apply.” 2014 WL 1580614, at *3. 16 Rather, when employment records are maintained and administered electronically, courts 17 have held that the location of the server establishes the location of the records under section 18 2000e-5(f)(3). In Gadson v. United Airlines, Inc., the plaintiff argued that her employment 19 records were electronically stored in United’s software program, which is hosted by Oracle, a 20 California company. No. 15–cv–00460–VC, 2015 WL 3372265, *2 (N.D. Cal. May 22, 2015). 21 Thus, the plaintiff argued that the IP address connected back to Redwood Shores, California, 22 where Oracle is located. Id. The court rejected this argument and clarified that § 2000e–5(f)(3) 23 provides that the action may be brought where the relevant records are “maintained and 24 administered,” not where the IP address for the server is located. Id. The court granted United’s 25 motion to transfer, based in part on evidence showing that the records at issue were stored on a 26 sever outside of Chicago. Id.; accord Cole v. Boeing Co., 901 F. Supp. 2d 47, 52 (D.D.C. 2012) 27 (finding that venue in Washington, D.C. was improper where electronic records were maintained 28 and administered on a server in Missouri). 14 1 Here, Defendants provide evidence that the employment records relevant to Plaintiffs’ 2 terminations, hiring, and promotion decisions are “maintained and administered” electronically on 3 servers located in Texas and Oregon. See Declaration of Vidyanand Sakthi (“Sakthi Decl.”) ¶¶ 3- 4 6, ECF 52-2; Suppl. Beene Decl. ¶¶ 3-7, ECF 52-1; see also Kendrick v. Potter, No. 06–122, 2007 5 WL 2071670, *3 (D.D.C. July 16, 2007) (“Declarations of human resource officers and employers 6 are sufficient to establish where the employment records are maintained and administered”). 7 Moreover, Plaintiffs provide no case to support their argument that the location of an employer’s 8 human resources function renders venue proper under section 2000e-5(f)(3). Nor is the Court 9 persuaded that unspecified “policies and procedures” created and maintained in this District are 10 United States District Court Northern District of California 11 sufficient to support venue under this prong of the statute. Ultimately, Plaintiffs’ allegations in support of venue under the “employment records” 12 prong of Title VII’s venue provision—such as the location of the human resources function and 13 that employment records, policies, and procedures were created and maintained in the Northern 14 District of California—amount to nothing more than an assertion that HP Inc. and HPE are 15 headquartered in this District. See Mot. at 13-14. Other district courts have concluded that an 16 employer’s headquarters in a district is not sufficient on its own to establish proper venue under 17 Title VII. See Amirmokri v. Abraham, 217 F. Supp. 2d 88, 90 (D.D.C. 2002). Below, the Court 18 considers whether the alleged “overarching plan” to get rid of older workers, which Plaintiffs 19 allege originated at Defendants’ headquarters in Palo Alto, supports venue in this District. 20 For the foregoing reasons, Plaintiffs have not established that venue is proper in the 21 Northern District of California based on where the employment records are maintained and 22 administered. See § 2000e-5(f)(3). 23 24 25 26 27 28 3. Where Unlawful Employment Practice is Alleged to Have Been Committed The crux of Defendants’ motion to dismiss for improper venue comes down to whether Plaintiffs have shown that the employment decisions involving Plaintiffs were made in this District. Although the Court addresses it last, the first prong of Title VII’s venue statute provides that an action “may be brought in any judicial district in the State in which the unlawful 15 1 employment practice is alleged to have been committed.” § 2000e-5(f)(3). In Passantino v. 2 Johnson & Johnson Consumer Prod., Inc., the Ninth Circuit considered whether this first possible 3 basis for venue under Title VII was satisfied, and held that “venue is proper in both the forum 4 where the employment decision is made and the forum in which that decision is implemented or 5 its effects are felt.” 212 F.3d at 506. 6 Relying on Passantino, Plaintiffs argue that Hewlett-Packard’s Workforce Reduction Plan 7 and Meg Whitman’s public statements regarding a desire for a “pyramid” structure with a younger 8 workforce support venue in this District. Opp’n at 15. Plaintiffs argue that this evidence satisfies 9 their burden to show that Defendants’ employment decisions to lay off older workers were made by leadership in Palo Alto. Id. The record indicates that the Workforce Reduction Plan originated 11 United States District Court Northern District of California 10 in May 2012, and on several occasions thereafter, Meg Whitman publicly expressed Defendants’ 12 desire to make their workforce younger by ensuring they had: “a labor pyramid with lots of young 13 people coming in right out of college and graduate school and early in their careers.” Exh. 9 to 14 Plaintiffs’ Request for Judicial Notice, ECF 53-9. According to Plaintiffs, this “overarching plan 15 to get rid of older workers” was made in Palo Alto and the effects of its implementation were felt 16 nationwide, including by Mr. Enoh in Maryland and Mr. Jackson in Georgia. Opp’n at 15. 17 But the circumstances in Passantino are markedly different from those presented here. In 18 Passantino, the plaintiff sued her former employer in the Western District of Washington for 19 failure to promote her in retaliation for her complaints of sex discrimination. 212 F.3d at 499. 20 The plaintiff also worked in that district. Id. The employer moved for a change of venue to New 21 Jersey, arguing that venue was improper in Washington because the decision not to promote the 22 plaintiff occurred in New Jersey. Id. at 504. The Ninth Circuit affirmed the district court’s denial 23 of the motion to transfer, interpreting the first prong of Title VII’s venue provision to mean that 24 “venue should be found where the effect of the unlawful employment practice is felt: where the 25 plaintiff works, and the decision to engage in that practice is implemented.” Id. at 505. 26 When the holding of Passantino is considered in context, it becomes clear that the Ninth 27 Circuit was considering whether venue under Title VII is proper in the district where the plaintiff 28 actually worked. In stark contrast to this case, both sides in Passantino accepted that venue was 16 1 proper where the employment decisions were made. The dispute in Passantino centered on the 2 employer’s argument that venue is only proper in a failure to promote case where the decision to 3 commit the unlawful employment practice was made. Id. at 505. The Ninth Circuit rejected that 4 argument outright. Id. (“Had Passantino been wrongfully discharged or subjected to a hostile 5 work environment, she could have sued in the district in which she worked. Nothing in the text or 6 history of the statute’s venue provision suggests that a different rule should apply in failure-to- 7 promote cases.”) The Ninth Circuit further noted that “Title VII’s venue provision obviously 8 contemplates the possibility that several districts could provide an appropriate venue for the same 9 action,” and concluded that venue was proper in both Washington and New Jersey. Id. at 506. Accordingly, Passantino stands for the proposition that Title VII plaintiffs feel the effects of their 11 United States District Court Northern District of California 10 injuries—even if the employment decisions are made elsewhere—in the District where they 12 actually worked. Id. 505-06 (holding that “venue is proper in both the forum where the 13 employment decision is made and the forum in which that decision is implemented or its effects 14 are felt.”) 15 Here, it is undisputed that none of the Plaintiffs or their direct managers worked for 16 Defendants in this District and none of the specific decisions regarding hiring, lay-offs, and 17 promotions occurred in this District. Rather, Plaintiffs hang their hats on the “overarching” 18 Workforce Reduction Plan and Meg Whitman’s public comments to analysts regarding 19 Defendants’ desire for a younger workforce, which Plaintiffs argue was a “directive” to managers 20 in other locations to make their teams younger. See, e.g., Opp’n at 15-16. In essence, Plaintiffs 21 argue that Defendants’ senior leadership, including Meg Whitman, made the alleged 22 discriminatory plan in Palo Alto, which was implemented by managers in Georgia and Maryland 23 who terminated Mr. Enoh and Mr. Jackson. See May 31, 2018 Hearing Transcript at 6:3-19 24 (“[Ms. Whitman] didn’t say fire Mr. Enoh or fire Mr. Jackson, but she sent that directive out, and 25 [the managers] have been following that directive from 2012 to 2017.”) 26 Based on the record before the Court, Plaintiffs have failed to establish that venue is proper 27 in the Northern District of California. Other than Passantino, Plaintiffs provide no authority that 28 comes close to establishing that a generalized policy to reduce the workforce coupled with alleged 17 1 “directives” from senior leadership emanating from an employer’s headquarters establishes venue 2 under the first prong of § 2000e-5(f)(3).8 For the reasons discussed above, Passantino certainly 3 does not go so far. Defendants argue that even if they are headquartered in this District and Plaintiffs can 4 show that upper-level employment decisions not specific to any Plaintiff were made at those 6 headquarters, venue is not proper under the first prong. See Mot. at 12. Rather, Defendants argue 7 that the alleged unlawful employment practices in this case are the termination decisions and the 8 alleged failure to hire and failure to promote, which the evidence shows were made and 9 implemented by Plaintiffs’ managers in Georgia and Maryland, with the effects felt by Plaintiffs in 10 their home states. See Reply at 2. The Court agrees that Plaintiffs have failed to meet their burden 11 United States District Court Northern District of California 5 of showing that venue is proper in the Northern District of California. See Piedmont Label 12 Co., 598 F.2d at 496. Even crediting Plaintiffs’ evidence of a high-level Workforce Reduction 13 Plan in place at HP since 2012 and Ms. Whitman’s startling comments to analysts regarding the 14 desire for a younger workforce, nothing in the SAC or in the record before the Court links 15 Plaintiffs’ terminations to any such plan or comments. The only reasonable conclusion to be 16 drawn from the record is that the decisions to terminate Plaintiffs were made and implemented by 17 managers outside of this District, the effects of which were felt outside of this District. Defendants rely on Slaby v. Holder, which this Court finds persuasive and directly on 18 19 point. 901 F.Supp.2d 129 (D.D.C. 2012). In Slaby, the plaintiff brought a disability 20 discrimination claim against the FBI under the Rehabilitation Act of 1973, whose venue is also 21 governed by Title VII’s venue provision. 901 F.Supp.2d at 133. The plaintiff argued that venue 22 was proper in Washington, D.C. because “the decisions about [the plaintiff’s] future were made at 23 FBI headquarters in Washington, D.C.,” and headquarters were consulted on or ultimately 24 approved the decision by Quantico training staff to remove the plaintiff as a Special Agent. Id. at 25 133. Despite allegations of involvement from FBI headquarters in the decision-making process, 26 8 27 28 Moreover, Defendants persuasively argued at the hearing that although there is evidence that Ms. Whitman made the alleged public statements to analysts, there is no evidence that any manager employed by Defendants—including Plaintiffs’ managers in particular—heard her comments or perceived them to be directives to make employment decisions based on them. 18 1 the Slaby court found that venue in Washington, D.C. was not a proper venue as the location “in 2 which the unlawful employment practice is alleged to have been committed.” Id. Instead, the 3 Slaby court found that Quantico, Virginia, was the location where the plaintiff alleged that 4 discriminatory employment practices occurred, and the court transferred the case to the Eastern 5 District of Virginia. Id. 9 6 Slaby involved even more of a connection to the organization’s headquarters than those 7 present here. In Slaby, Quantico personnel actually told the plaintiff that FBI headquarters was 8 making decisions about his employment status. Id. at 133. No such allegations are present in this 9 case, and Plaintiffs do not provide a shred of evidence or even an allegation on information and belief that managers were aware of Ms. Whitman’s comments and perceived them to be directives 11 United States District Court Northern District of California 10 to terminate Plaintiffs Enoh and Jackson in favor of younger workers. Accordingly, Plaintiffs 12 have not demonstrated that the underlying unlawful employment decisions were made in the 13 Northern District of California. See Slaby, 901 F. Supp. 2d at 134; see also Robinson v. 14 Potter, No. 04–cv–0890, 2005 WL 1151429, at *4 (D.D.C. May 16, 2005) (finding that “[i]f the 15 court were to interpret actions…of an administrative agency as decisions determined at the 16 agency’s headquarters then a plaintiff would always be able [to] establish venue wherever the 17 principal office is located. Even a cursory review of 42 U.S.C. § 2000e-5(f)(3) reveals that 18 Congress did not intend this; the statute expressly limits the use of the principal office for 19 establishing venue to only situations where a defendant may not be found within the judicial 20 district that is the locus of the alleged discrimination.”) 21 Other district courts have similarly determined that alleged companywide discriminatory 22 policies emanating from corporate headquarters do not make venue proper in the location of the 23 company’s headquarters. See Ring v. Roto-Rooter Servs. Co., No. 1:10-CV-179, 2010 WL 24 9 25 26 27 28 The Court recognizes that Slaby is out-of-circuit and that court did not follow the interpretation of Title VII’s venue provision set forth in Passantino. However, the parties and the Court were unable to find any authority in the Ninth Circuit after Passantino that dealt with allegations of high level corporate directives and involvement from headquarters in alleged discrimination. As explained above, Passantino is factually dissimilar from this case and its focus was on whether venue was proper in the district where an employee actually worked. This Court is not persuaded that it should be the first to stretch Passantino’s holding to the circumstances alleged here, particularly in light of Slaby and other district courts’ rejection of Plaintiffs’ line of argument. 19 3825390, at *5 (S.D. Ohio Sept. 28, 2010) (holding that the plaintiff’s “allegations that her St. 2 Louis supervisors were following a companywide discriminatory policy emanating from 3 headquarters in Cincinnati does not make venue proper in this District.”); see also Cook v. UBS 4 Fin. Servs., Inc., No. 05 Civ. 8842, 2006 WL 760284, at *3–4 (S.D.N.Y. Mar. 21, 2006) 5 (dismissing action for improper venue where plaintiffs alleged that the company’s New York 6 headquarters approved broad-based personnel policies, but the specific personnel decisions 7 impacting the plaintiff occurred in Maryland); Darby v. U.S. Dep't of En., 231 F.Supp.2d 274, 277 8 (D.D.C. 2002). These district courts rejected arguments similar to those advanced by Plaintiffs 9 here, and found that venue was proper in the district where the employees worked because that is 10 where the specific employment decisions impacting the plaintiff were made. Plaintiffs do not cite 11 United States District Court Northern District of California 1 any authority that counters the reasoning in these cases, and Plaintiffs’ brief attempt to distinguish 12 Slaby is entirely unpersuasive in light of the Court’s reading of Passantino. See Opp’n at 16. For these reasons, the Court finds that venue is improper in the Northern District of 13 14 California under Title VII’s venue provision allowing a plaintiff to bring an action where “the 15 unlawful employment practice is alleged to have been committed.” § 2000e-5(f)(3). The 16 challenged employment decisions based on alleged age discrimination were made and 17 implemented by Plaintiffs’ managers in Maryland and Georgia, and the effects of those actions 18 were felt by Plaintiffs Enoh and Jackson in Maryland and Georgia, respectively. See Passantino, 19 212 F.3d at 506 (“Thus, we hold that venue is proper in both the forum where the employment 20 decision is made and the forum in which that decision is implemented or its effects are felt.”) Ms. 21 Whitman’s comments explaining the Workforce Reduction Plan do not suffice to meet Plaintiffs’ 22 burden to show that the underlying employment decisions were made in this District, or that the 23 managers made the challenged decisions based on directives emanating from this District.10 24 25 26 10 27 28 As discussed at the hearing, the Court finds that the only claims that could possibly support venue in this District are Plaintiffs’ age discrimination claims based on the reduction in force terminations. Plaintiffs put forth no independent allegations, evidence, or argument to support venue in California for the race discrimination claims or remaining age discrimination claims. 20 4. 1 Dismiss or Transfer For the foregoing reasons, the Court finds that venue is not proper in the Northern District 2 3 of California under any of the prongs set forth in § 2000e-5(f)(3). Therefore, the Court may either 4 dismiss the case or transfer it to a proper venue “if it be in the interest of justice.” See 28 U.S.C 5 § 1406(a); see also King v. Russell, 963 F.2d 1301, 1304 (9th Cir. 1992) (noting that the court has 6 discretion in determining whether to transfer or dismiss an action for improper venue).11 Defendants request that the Court dismiss the case, or in the alternative, transfer the case to 8 the Northern District of Georgia, where three of the Plaintiffs lived and worked. Mot. at 3. At the 9 May 31, 2018 hearing, Plaintiffs indicated that it is not clear where venue should be, and the Court 10 agrees that venue could be proper in several districts. Having considered the circumstances of this 11 United States District Court Northern District of California 7 case and the positions of the parties, the Court finds that the interests of justice are best served by 12 dismissing Plaintiffs’ claims without prejudice to re-filing in a district that satisfies the 13 requirements of § 2000e-5(f)(3). 14 B. Remaining Issues 15 In addition to their motion to dismiss for improper venue, Defendants move to (1) dismiss 16 Plaintiffs’ ADEA claims pursuant to the first-to-file rule; (2) dismiss all claims pursuant to Rules 17 12(b)(1) for lack of standing and Rule 12(b)(6) for failure to state a claim; and (3) move to strike 18 Plaintiffs’ class allegations on the grounds that the class definitions are temporally overbroad with 19 respect to the applicable statute of limitations. See Mot. at 15-24. At the May 31, 2018 hearing, 20 Plaintiffs requested that this Court rule on the adequacy of their pleadings even if the Court 21 determined that venue was not proper in this District. See May 31, 2018 Hearing Transcript at 22 27:19-28:6. Defendants argued that if venue is not proper in this District then the appropriate 23 course of action is for this Court to refrain from ruling on the remainder of the motion to dismiss 24 and allow the transferee court to deal with the remaining issues. Id. at 14:6-10. 25 As discussed above, this Court will not transfer this action but rather dismisses Plaintiffs’ 26 claims without prejudice to filing the action in a district where venue is proper. Accordingly, the 27 11 28 In light of its conclusion that venue is improper, the Court does not reach Plaintiffs’ § 1404 arguments. 21 1 Court addresses additional deficiencies in the SAC that warrant dismissal of Plaintiffs’ claims with 2 leave to amend, and directs Plaintiffs to address such deficiencies prior to re-filing this case in 3 another district.12 First, although Plaintiffs allege that Defendants became two separate entities in November 4 5 2015, the SAC fails to plead any facts specific to each entity. SAC ¶ 11. By conflating HP Inc. 6 and HPE without regard for which entity employed each Plaintiff or bears responsibility for the 7 challenged employment decisions, Plaintiffs have failed to state a plausible claim for race and age 8 discrimination against HP Inc. and HPE, as the Court cannot “draw the reasonable inference that 9 the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678. Without identifying which entity employed Plaintiffs or considered their applications for employment, Plaintiffs have 11 United States District Court Northern District of California 10 not established that they have standing to sue either HP Inc. or HPE. 12 The Court also finds that Plaintiffs’ disparate impact allegations against Defendants are 13 insufficient. Although a disparate impact plaintiff, unlike a plaintiff proceeding on a disparate 14 treatment theory, may prevail on a discrimination claim without showing intentional 15 discrimination, the Ninth Circuit has opined that “the requirements a disparate impact plaintiff 16 must meet are in some respects more exacting than those of a disparate treatment case. A 17 disparate impact plaintiff must not merely prove circumstances raising an inference of 18 discriminatory impact; he must prove the discriminatory impact at issue.” Lowe v. City of 19 Monrovia, 775 F.2d 998, 1004 (9th Cir. 1985), amended, 784 F.2d 1407 (9th Cir. 1986) (citing 20 Moore v. Hughes Helicopters, Inc., 708 F.2d 475, 482 (9th Cir. 1983). This is usually done by 21 establishing “that an employment practice selects members of a protected class in a proportion 22 smaller than their percentage in the pool of actual applicants.” Lowe, 775 F.2d at 1004 (internal 23 citations omitted). “Identifying a specific practice is not a trivial burden in age discrimination cases alleging 24 25 disparate impact.” Stockwell v. City & Cty. of San Francisco, 749 F.3d 1107, 1114 (9th Cir. 2014) 26 (quoting Meacham v. Knolls Atomic Power Lab., 554 U.S. 84, 101, 128 S. Ct. 2395, 2406, 171 L. 27 12 28 The Court does not reach Defendants’ motion to dismiss the ADEA claims pursuant to the firstto-file rule, which is more properly determined by the court that will oversee this case. 22 1 Ed. 2d 283 (2008). As the Ninth Circuit pointed out in Stockwell, “the first Supreme Court case to 2 recognize the viability of a disparate-impact theory under the ADEA rejected the claim on the 3 merits for ‘failure to identify the specific practice being challenged,’ among other shortcomings.” 4 749 F.3d at 1114 (quoting Smith v. City of Jackson, 544 U.S. 228, 241 (2005)). Moreover, 5 “[p]laintiffs generally cannot attack an overall decisionmaking process in the disparate impact 6 context, but must instead identify the particular element or practice within the process that causes 7 an adverse impact.” Durante v. Qualcomm, Inc., 144 F. App’x 603, 606 (9th Cir. 2005) (quoting 8 Stout v. Potter, 276 F.3d 1118, 1124 (9th Cir. 2002). Here, Plaintiffs do not plead and identify a 9 facially neutral policy of selection criteria that had a disparate impact on older or AfricanAmerican employees. The SAC’s allegations that “HP allowed an overwhelmingly Caucasian 11 United States District Court Northern District of California 10 group of selectors to use a ‘hazy’ selection process for its employment decisions,” is too vague to 12 support Plaintiffs’ disparate impact claims. See, e.g., SAC ¶¶ 2(b), 68, 91; see Smith, 544 U.S. at 13 241 (“[I]t is not enough to simply allege that there is a disparate impact on workers, or point to a 14 generalized policy that leads to such an impact.”)13 Plaintiffs also fail to explain how the adverse employment decisions complained of were 15 16 the result of Defendants’ alleged “hazy” selection process. To the extent Plaintiffs choose to 17 proceed on their disparate impact claims, they must not only identify the specific neutral policy 18 and selection criteria that had a disparate impact, but they must allege facts to show that the 19 challenged policy played a role in the decision to terminate or fail to promote or hire them. 20 Similarly, the SAC’s allegation that a Workforce Reduction Plan existed without further factual 21 detail requires amendment in order to proceed as the basis for disparate impact discrimination 22 based on age.14 23 24 25 26 27 28 13 Plaintiffs’ allegations that Defendants utilized a “tap on the shoulder” approach to promote Caucasian employees also cannot support a disparate impact claim, as such a policy is not facially neutral by definition. SAC ¶¶ 2(c), 67. Accordingly, these allegations can only support Plaintiffs’ claims for intentional race discrimination. 14 As discussed above, Ms. Whitman’s comments and other statements regarding Defendants’ Workforce Reduction Plan are not alleged in the SAC. Although the Court considered these statements to determine whether venue is proper, the Court does not look outside the pleadings in determining the adequacy of Plaintiffs’ claims. However, The Court considers such information to be a proffer of what Plaintiffs could amend to include as a factual basis for their claims. 23 1 Finally, Defendants move to strike Plaintiffs’ class definition for their race discrimination 2 claims as overly broad. See Mot. at 26. Under Rule 12(f), “the court may order stricken from any 3 pleading any insufficient defense or any redundant, immaterial, impertinent, or scandalous 4 matter.” Rule 12(f) is a vehicle by which to “avoid the expenditure of time and money that must 5 arise from litigating spurious issues by dispensing with those issues prior to trial.” Sidney–Vinstein 6 v. A.H. Robins Co., Inc., 697 F.2d 880, 885 (9th Cir.1983). A defendant may move to strike class 7 actions prior to discovery where the complaint demonstrates a class action cannot be maintained 8 on the facts alleged therein. Sanders v. Apple, Inc., 672 F.Supp.2d 978, 990 (N.D. Cal. 2009). 9 Plaintiffs purport to represent a nationwide class of “all other similarly situated current, past, present, and future employees of HP who are African- American/black, who have been, 11 United States District Court Northern District of California 10 continue to be, or in the future subject to one or more aspects of the systemic race discrimination 12 described in this Complaint.” SAC ¶ 23. Defendants point out that this class definition fails to 13 comport with the statute of limitations applicable to race discrimination claims under Title VII and 14 Section 1981. The named plaintiff in a Title VII class action “may represent only those similarly 15 situated individuals who either have filed timely charges with the EEOC or who could have filed a 16 timely charge on the same date as the named plaintiff.” Church v. Consol. Freightways, Inc., 137 17 F.R.D. 294, 309 (N.D. Cal. 1991). Claims of intentional discrimination under Section 1981 are 18 subject to a limitations period of four (4) years. Fonseca v. Sysco Food Servs. of Arizona, Inc., 374 19 F.3d 840, 845 (9th Cir. 2004). 20 The Court agrees with Defendants that Plaintiffs must amend their overbroad class 21 definition for their race discrimination claims to exclude individuals who are barred by their 22 failure to timely file a claim with the EEOC, or who suffered injuries outside of the four year 23 statute of limitations period under Section 1981. Contrary to Plaintiffs’ argument that motions to 24 strike class allegations at the pleading stage are generally disfavored, the Court finds that imposing 25 time limitations on the class definition at the outset of the litigation is necessary to protect 26 Defendants from burdensome and unnecessary class discovery on barred claims and individuals. 27 See Gen. Tel. Co. of Sw. v. Falcon, 457 U.S. 147, 160 (1982) (“Sometimes the issues are plain 28 enough from the pleadings to determine whether the interests of the absent parties are fairly 24 1 encompassed within the named plaintiff’s claim.”); see also Sandoval v. Ali, 34 F. Supp. 3d 1031, 2 1043 (N.D. Cal. 2014) (“Class allegations can be stricken at the pleading stage.”) 3 4 V. ORDER For the foregoing reasons, IT IS HEREBY ORDERED that Defendants’ motion to dismiss 5 this action for improper venue is GRANTED. Defendants’ remaining motion to dismiss and 6 motion to strike are GRANTED IN PART WTIHOUT PREJUDICE in line with the discussion 7 above and on the record at the May 31, 2018 hearing. 8 9 10 Plaintiffs’ claims are DISMISSED WITHOUT PREJUDICE to re-filing this action in a District where venue is proper pursuant to 42 U.S.C. § 2000e-5(f)(3). The Clerk shall close the file. United States District Court Northern District of California 11 12 13 14 Dated: July 11, 2018 ______________________________________ BETH LABSON FREEMAN United States District Judge 15 16 17 18 19 20 21 22 23 24 25 26 27 28 25