Strifling v. Twitter Inc.

Background

X began a reduction in force after Elon Musk acquired the company in October 2022. The opinion states that approximately 2,621 of X’s 5,134 employees were affected, with most notified on November 4, 2022. Carolina Bernal Strifling and Willow Wren Turkal, both former X employees, alleged that the layoffs disproportionately affected women.

The plaintiffs asserted sex-discrimination claims under Title VII of the Civil Rights Act of 1964. Turkal also asserted a claim under California’s Fair Employment and Housing Act. They filed administrative charges with the Equal Employment Opportunity Commission, and Turkal also filed a charge with California’s Civil Rights Department. They received right-to-sue notices after filing the federal case. The court had previously dismissed their claims and allowed them to amend.

Administrative exhaustion

X argued that the plaintiffs had not adequately alleged that they completed the required administrative process before filing suit. The court rejected that argument. It held that the right-to-sue notices already in the record were enough to address the pleading issue.

The court also held that receiving the notices after filing the lawsuit satisfied the exhaustion requirement under both Title VII and the California law claim. For the Title VII claims, the court found no evidence that the early filing prevented the agency from performing its duties or harmed X. For the California claim, the court concluded that later California decisions recognized equitable exceptions to the exhaustion requirement and that requiring a new lawsuit would be pointless formalism.

Disparate treatment

A disparate-treatment claim alleges that an employer treated a person less favorably because of a protected characteristic. The court held that the amended complaint still did not state such a claim.

First, the plaintiffs did not allege that they themselves were subject to the November 2022 layoffs. Second, even assuming they were terminated, they did not provide enough facts to plausibly show that they were laid off because of sex. The complaint did not compare their qualifications, experience, performance, or abilities with those of male employees who were not laid off. The court also found that statements attributed to Musk, including the alleged use of white paint to obscure the “w” on the Twitter sign, did not support an inference of sex-based intent because they were not tied to the layoff decisions.

Disparate impact

A disparate-impact claim challenges a specific employment practice that appears neutral but disproportionately harms a protected group. The court previously found that the plaintiffs had identified a potentially neutral practice: delegating layoff decisions to a small group of managers who allegedly did not largely use objective criteria.

The court declined to dismiss the claim merely because the complaint contained inconsistent statistical figures, accepting the plaintiffs’ explanation that one chart was included by clerical error. The court stated that both sets of figures showed a significant statistical disparity.

The claim nevertheless failed because the plaintiffs did not adequately allege causation. In particular, they did not allege that they were subject to the reduction in force, so they did not sufficiently connect the managers’ discretion to the gender disparity generally or to their own alleged injuries. The opinion also states that, without allegations that the plaintiffs themselves were subject to the reduction in force, they lacked standing to challenge the policy.

Disposition

The court granted X’s motion to dismiss. It dismissed the complaint with leave to amend, allowing the plaintiffs 21 days to file an amended complaint solely to cure the deficiencies identified in the order. The court stated that failure to file a timely amended complaint would result in dismissal with prejudice.