Turner-Gray v. Avis Budget Group Inc.

Background

Avia Turner-Gray alleged that she was hired by AMN Healthcare Interim Services to work as an interim manager at a Bay Area hospital during the COVID crisis beginning in early 2021. She alleged that the AMN defendants provided a rental car as part of her compensation and required nurses receiving that benefit to use Avis.

Turner-Gray alleged that at least some Avis vehicles had safety problems and that she notified the AMN defendants. She later exchanged a vehicle at an Avis location. According to the first amended complaint, Avis failed to record information about that rental and reported the vehicle as stolen. Turner-Gray was later arrested on suspicion of felony car theft and joyriding. She alleged that an AMN executive told her that it was her responsibility to ensure that Avis followed its rental procedures.

The AMN defendants moved to dismiss Turner-Gray’s first amended complaint under Federal Rule of Civil Procedure 12(b)(6), which requires dismissal when a complaint does not state a legally sufficient claim. The motion concerned claims against the AMN defendants, not the claims against Avis addressed in the opinion.

Claims Based on Avis’s Conduct

Turner-Gray brought the first seven causes of action against the AMN defendants on a theory of indirect liability for Avis’s conduct. The claims were negligence, gross negligence, malicious prosecution, intentional infliction of emotional distress, false arrest and imprisonment, and negligent hiring, retention, supervision, and training. The opinion noted that the complaint’s organization created some uncertainty about the numbering of the negligent-hiring claims.

The court focused on whether the complaint plausibly alleged an agency relationship between Avis and the AMN defendants. Under California law, an agency relationship can make one party liable for another party’s acts. The court identified the right of the alleged principal to control the alleged agent’s conduct as an essential element.

The court held that the complaint did not allege facts showing that Avis could alter the legal relationships of the AMN defendants, that Avis was their fiduciary, or that the AMN defendants could control Avis’s conduct. The facts that the AMN defendants offered a rental-car benefit and required nurses to use Avis, without more, did not establish an agency relationship. The court also found no alleged facts suggesting that the AMN defendants and Avis had a managerial relationship or that the AMN defendants had the right to control Avis’s activities.

For the negligent-hiring, retention, supervision, and training claim, the court explained that California law requires an employer-employee relationship or an agency relationship. Because Turner-Gray had not plausibly alleged an agency relationship between Avis and the AMN defendants, the court dismissed that claim as well.

Breach of Fiduciary Duty

Turner-Gray alleged that the AMN defendants owed her a fiduciary duty concerning the rental cars and breached that duty by failing to hold Avis accountable for safety, care, and maintenance problems. A fiduciary duty is a heightened obligation to act for another person’s benefit in a relationship of trust.

The court found that Turner-Gray’s allegations were inconsistent with her claim that the AMN defendants acted as her agents because she alleged that the AMN defendants selected Avis as the sole rental-car vendor and required her to use Avis. The court also explained that an ordinary employer-employee relationship, without additional facts, does not create a fiduciary relationship. Because Turner-Gray did not allege facts showing that her relationship with the AMN defendants differed from an ordinary employment relationship, the court dismissed the fiduciary-duty claim with leave to amend.

Disposition

The court granted the AMN defendants’ motion to dismiss the complaint and dismissed Turner-Gray’s claims against those defendants with leave to amend. The court allowed Turner-Gray to file an amended complaint by November 1, 2024. It advised that any amended complaint would need facts supporting a plausible agency relationship, such as facts showing that the AMN defendants had the right to control Avis’s rental-car procedures, or facts showing that the AMN defendants assumed a fiduciary duty to Turner-Gray.