September 2000 Vol. 6 No. 9 ISSN 1087-6219
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In This Issue

• California Supreme Court lays down rules for arbitration of employment discrimination claims
• Gun manufacturer not liable to police officer injured in shootout
• Private doctor under contract to state is subject to civil rights suit for commitment decision
• Outcome of administrative proceedings may bar FEHA claims, but not Title VII claims
• UPDATES

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California Supreme Court lays down rules for arbitration of employment discrimination claims

The California Supreme Court has upheld the arbitrability of employment discrimination claims, so long as the employee may recover the full damages and attorney fees provided by statute. It also imposed certain procedural requirements, including a neutral arbitrator, provision for adequate discovery, a written statement of findings and conclusions, and limitations on the costs the employee may be forced to bear.

Foundation Healthcare required its employees to agree to an arbitration clause that (1) required arbitration of all employment claims by employees, (2) limited remedies to the wages that would have been earned between the discharge and the arbitration award, (3) did not require the employer to arbitrate its claims, and (4) required the employee to pay a pro rata share of the arbitrator's fees and expenses.

The Supreme Court rejected the argument that employees could not be required to arbitrate their FEHA claims under any circumstances. It rejected the contrary conclusion that the Ninth Circuit reached in Duffield v. Robertson Stephens & Co., 144 F.3d 1182 (9th Cir.), cert. denied, 119 S.Ct. 465 (1998). However, because the remedial rights conferred by FEHA are unwaivable, the limitation of remedies was unlawful.

To assure effective enforcement of their rights, the employees are entitled to adequate discovery, including access to essential documents and witnesses. Further, the arbitrator must issue a written arbitration decision that recites the essential findings and conclusions on which the award is based. That is necessary to insure that the arbitrator has complied with the statutory requirements.

Typically, the out-of-pocket costs for arbitration far exceed those for a lawsuit. Because such costs may deter employees from pursuing their claims, an arbitration clause may not require employees to incur any type of expense that would not be required for pursuing the lawsuit in court.

Armendariz v. Foundation Psychcare Services, Inc., 2000 WL 1201652 (Cal. Sup. Ct. Aug. 24, 2000).

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Gun manufacturer not liable to police officer injured in shootout

The Second District Court of Appeal in Los Angeles has rejected a products liability claim against a gun manufacturer. The plaintiff was a police officer who was badly injured in a shootout with robbers at the North Hollywood Branch of Bank of America.

Officer Martin Whitfield was shot with a Heckler & Koch semiautomatic assault rifle, which had been modified to allow fully automatic operation. The bank robbers had purchased the gun legally in Maryland.

Officer Whitfield sued Heckler & Koch on theories of ultra hazardous products liability, strict product liability, negligent design product liability and negligence. The court affirmed the dismissal of all causes of action.

To determine whether there is ultra hazardous product liability, a court traditionally weighs the following factors: (1) existence of a high degree of risk of some harm, (2) likelihood that the harm will be great, (3) inability to eliminate the risk by the exercise of reasonable care, (4) the extent to which the activity is not a matter of common usage, (5) the inappropriateness of the activity to the place where it is carried on, and (6) the extent to which the activity's value to the community is outweighed by its dangerous attributes.

Officer Whitfield's claim was insufficient under that test. Guns can be used safely if the user exercises proper care. Gun use is fairly commonplace.

The court rejected Officer Whitfield's attempt to add an additional factor to the test -- the inappropriateness of marketing the product to the general consumer public. That would turn courts and juries into arbiters of which products are appropriate and which are not.

A straight product liability claim requires proof of a product defect, which may be one of three types: (1) a flaw in the manufacturing process, which produces a product other than what the manufacturer intended, (2) the absence of a safety device, or (3) lack of adequate warnings or instructions. In this case, the manufacturer got the product that it wished. There was no safety device that could have prevented the injury to Officer Whitfield.

Heckler & Koch also enjoyed immunity from products liability under Civil Code section 1714.4. That section bars weighing the risks and benefits of a gun or ammunition in deciding whether a product is defective. It also provides that any injuries from shooting a gun “are not proximately caused by its potential to cause serious injury, damage, or death, but are proximately caused by the actual discharge of the [gun].” Although the section does not bar claims based on “improper selection of design alternatives,” Officer Whitfield did not identify any design alternative that would have prevented his injury.

The negligence claim failed, because there is generally no tort duty to prevent injuries that are caused by a third party's criminal actions. There were no special relationships or circumstances that would take this case out of the general rule.

The firefighter's rule provided another defense to all the claims. Under that rule, firefighters and police officers may not sue for injuries caused by the negligence that required their presence. The risk of getting shot while attempting to apprehend criminals is part of a police officer's job.

Whitfield v. Heckler & Koch, Inc., 82 Cal. App. 4th 1200 (Cal. Ct. App. Aug. 9, 2000).

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Private doctor under contract to state is subject to civil rights suit for commitment decision

The Ninth Circuit has ruled that a private doctor under contract to the state is subject to suit as a government actor under 42 U.S.C. section 1983. However, he did not enjoy qualified immunity for his actions.

Dr. Jeffrey M. Robbins ordered Jerry Jensen detained for mental evaluation, based on information that he was a danger to himself or others. The information came from a county mental health worker. At the time Jensen was an inmate in the county jail. Dr. Robbins was providing psychiatric services under a contractual arrangement with the county.

Jensen brought a federal civil rights lawsuit against Dr. Robbins, and several other persons involved in his detention. Although the district court granted summary judgment for Dr. Robbins, the Ninth Circuit reversed.

To pursue a federal civil rights claim against Dr. Robbins, Jensen had to show that the doctor's conduct constituted state action. A private doctor's civil commitment order does not constitute state action as a general rule.

In this case, the contractual arrangement so insinuated the county into the process as to make the decision state action. County employees initiated the evaluation process. There was significant consultation between county mental health professionals and the private doctor. The private medical group of which Dr. Robbins was a part helped to develop and maintain the mental health policies of the county hospital where Jensen was detained.

The court determined that Dr. Robbins could not avail himself of a qualified immunity defense. There was no firmly rooted tradition of immunity for private doctors in such circumstances.

Further, the policy justifications for qualified immunity did not support the defense. The timidity that might develop in public employees can be overcome by market forces in the private sector, and the availability of insurance. Private entities would compete to provide the services.

The threat of distraction from one's duties was insufficient by itself to justify the defense.

Jensen v. Lane County, 2000 WL 1191041 (9th Cir. Aug. 23, 2000).

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Outcome of administrative proceedings may bar FEHA claims, but not Title VII claims

The California Supreme Court has recognized the preclusive effect of administrative agency determinations on employment discrimination claims brought under the Fair Employment and Housing Act (FEHA). However, they cannot preclude claims brought under Title VII of the federal Civil Rights Act.

Barry Johnson was Loma Linda's assistant city manager. He investigated a sexual discrimination claim by one of the city's female employees, and determined that it was well-founded. About ten months later, after a change in the city manager position, Johnson received notice that he was being laid off for budgetary reasons.

Johnson challenged his layoff before the city personnel board, claiming that the layoff was retaliation for his endorsement of the sexual discrimination claim. The personnel board rejected his grievance, ruling that the layoff was for economic reasons. The city council upheld the board's decision in December 1993.

Johnson obtained a right to sue letter from the California Department of Fair Employment and Housing. In July 1995, he filed an action that (1) alleged violations of FEHA and Title VII, and (2) petitioned for a writ of mandate to overturn the personnel board's decision.

The Supreme Court upheld the trial court's decision that laches barred Johnson's writ petition. In the over 18 months that passed before Johnson sought a writ, Loma Linda had revamped its management structure, and redistributed Johnson's functions to others. Granting a writ under those circumstances would have required the city to unwind its new structure. It would also have subjected the city to double payments-back wages to Johnson, and the salaries paid to the employees who assumed his functions.

Because Johnson's writ petition was untimely, the personnel board's decision that he was discharged for legitimate reasons was final. In order to pursue any state law claim in the face of that finding, he had to have exhausted his right of judicial review.

The United States Supreme Court has ruled that unreviewed state administrative determinations may not bar Title VII claims. There must be a judicial determination with a res judicata effect under state law.

Although the trial court had refused to overturn the personnel board's decision, it had not ruled on the merits. Therefore, there was no res judicata effect under California law.

Johnson v. City of Loma Linda, 99 Cal. Rptr. 2d 316 (2000).

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UPDATES

Subsequent treatment of decisions reported on in earlier issues:

Asmus v. Pacific Bell (July 2000 issue), rehearing denied (Aug. 16, 2000).

Braunling v. Countrywide Home Loans, Inc. (August 2000 issue), now reported at 220 F.3d 1154 (9th Cir. 2000).

Calhoon v. Lewis (July 2000 issue), time for grant or denial of rehearing extended to Oct. 10, 2000.

Firestone v. Southern California Gas Co. (August 2000 issue), now reported at 219 F.3d 1063 (9th Cir. 2000).

Frank v. United Airlines, Inc. (July 2000 issue), now reported at 216 F.3d 845 (9th Cir. 2000).

Robinson v. Solano County (August 2000 issue), now reported at 218 F.3d 1030 (9th Cir. 2000).

Rosales v. City of Los Angeles (August 2000 issue), now reported at 82 Cal. App. 4th 419 (2000).

Sony Computer Entertainment America, Inc. v. Bleem, LLC (May 2000 issue), now reported at 214 F.3d 1022 (9th Cir. 2000).

Streit v. Covington & Crowe (August 2000 issue), now reported at 82 Cal. app. 4th 441 (2000).

Wasson v. Sonoma County Junior College (March 2000 issue), petition for certiorari filed (Aug. 7, 2000).

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