Howington v. Taiwan Semiconductor Manufacturing Co., Ltd.

Background

The plaintiffs brought a putative class action alleging employment discrimination by Taiwan Semiconductor Manufacturing Co., Ltd., TSMC North America, TSMC Technology, Inc., TSMC Arizona Corporation, and TSMC Washington, LLC, which the opinion collectively calls “TSMC.” The operative first amended complaint asserted class claims under 42 U.S.C. § 1981 for race- and citizenship-based disparate treatment and race-based hostile work environment. It also asserted claims under Title VII, including race- and national-origin-based disparate treatment, disparate impact, and hostile work environment. Certain plaintiffs asserted individual retaliation claims.

The plaintiffs had proposed adding Michelle Bernardo as a named plaintiff in a second amended complaint. The proposed pleading included claims concerning Bernardo’s experiences and an individual retaliation claim under § 1981. Before that amendment was filed, TSMC investigated Bernardo after reviewing the proposed pleading and becoming concerned that she had disclosed confidential information about other TSMC employees. TSMC said Bernardo had violated policies concerning confidential information, access to company information, and cooperation with the investigation. TSMC terminated Bernardo’s employment on March 18, 2025.

The plaintiffs argued that TSMC terminated Bernardo in retaliation for protected activity related to the lawsuit. They asked the court for a temporary restraining order requiring TSMC to rescind the termination and reinstate Bernardo in the human resources department.

Legal standard

The court explained that the standard for a temporary restraining order is the same as the standard for a preliminary injunction. The moving party must show a likelihood of success on the merits, likely irreparable harm without immediate relief, a favorable balance of equities, and that the injunction would serve the public interest. Under the Ninth Circuit’s sliding-scale approach, serious questions on the merits may sometimes suffice if the balance of hardships sharply favors the moving party, but the party must still show likely irreparable injury and that the injunction is in the public interest.

Court’s analysis

Standing and authority

The court first held that the plaintiffs had not demonstrated their standing to obtain, or the court’s authority to grant, the requested relief. The motion sought relief solely for Bernardo individually. Bernardo was not a party to the action, and the putative classes had not been certified. The court concluded that, before class certification, preliminary injunctive relief generally may cover only named plaintiffs. The plaintiffs’ motion was also based on Bernardo’s proposed individual retaliation claim, which was not yet part of the case.

The court rejected the plaintiffs’ argument that Federal Rule of Civil Procedure 23(d) authorized the requested injunction. The court said the rule permits orders managing class-action proceedings and related procedural matters, but the plaintiffs provided no authority showing that it authorized preliminary relief addressing the merits of the action. The court also concluded that the All Writs Act did not provide a basis for the requested injunction because the plaintiffs had not shown the required critical and exigent circumstances or that the legal rights at issue were indisputably clear.

Likelihood of success

The court separately concluded that, even if there were no standing or authority problem, the plaintiffs had not shown a likelihood of success on Bernardo’s proposed retaliation claim. A retaliation claim under § 1981 requires proof of protected activity, a materially adverse employment action, and a causal connection between the protected activity and the adverse action. The court analyzed the issue largely under Title VII standards because the parties’ briefs focused on those standards.

The plaintiffs identified Bernardo’s protected activity as seeking to participate in the lawsuit, filing a discrimination charge with the Equal Employment Opportunity Commission, and sharing information with her attorney to advance the discrimination claims. The plaintiffs acknowledged that the information included confidential personnel information about other TSMC employees that Bernardo knew or learned through her human resources position. TSMC argued that disclosure of that information violated its policies and could not constitute protected activity.

The court explained that protected opposition activity must be reasonable in view of the employer’s interest in maintaining a harmonious and efficient workplace. On the record presented, the court could not find that Bernardo’s disclosure of confidential employee information constituted protected participation activity or reasonable opposition activity. The court also could not find a causal link between protected activity and the termination. The court noted that the circumstances and reasons for the termination were strongly contested and were not limited to Bernardo’s disclosure of confidential information to her attorney.

Irreparable harm

The court found that the plaintiffs had not established irreparable harm. Bernardo described lost income, effects on her ability to pay doctoral-program tuition and medical bills, concerns about her reputation, and concern that other employees might be discouraged from reporting mistreatment. The court stated that economic injury generally is not irreparable because monetary damages can provide an adequate remedy.

The court also found Bernardo’s assertions about a chilling effect and reputational harm speculative. The record included evidence that TSMC Arizona did not disclose to other employees the names of people terminated for confidentiality violations and would provide prospective employers only Bernardo’s dates of employment. The court concluded that the plaintiffs had not established irreparable harm warranting immediate relief.

Balance of equities and public interest

The court found that the balance of equities did not favor the plaintiffs. Requiring TSMC to reinstate Bernardo in the position of trust that TSMC claimed she had breached would impose a burden on TSMC, particularly given the parties’ disputed views about confidentiality and the practical management of Bernardo’s duties.

The court also concluded that the plaintiffs had not shown that the requested injunction served the public interest. Although the public has an interest in enforcing civil-rights laws, the court said the public also has an interest in protecting the privacy of third-party employees’ personnel information. Because the circumstances and reasons for Bernardo’s termination were fiercely contested, the court could not find that the public interest clearly favored either side.

Disposition

Judge Virginia K. DeMarchi denied the plaintiffs’ motion for a temporary restraining order. The order did not decide the ultimate merits of the plaintiffs’ employment-discrimination claims or Bernardo’s proposed retaliation claim.