Howington v. Taiwan Semiconductor Manufacturing Co., Ltd.

Background

Plaintiffs brought a putative class action against Taiwan Semiconductor Manufacturing Co., Ltd., TSMC North America, TSMC Technology, Inc., TSMC Arizona Corporation, and TSMC Washington, LLC. They allege an intentional pattern and practice of employment discrimination against people who are not East Asian, Taiwanese, or Chinese, including discrimination in hiring, staffing, promotion, and termination or constructive discharge. They also allege a hostile work environment involving verbal abuse, isolation, humiliation, and other conduct.

The operative first amended complaint asserted class claims under 42 U.S.C. § 1981 for race- and citizenship-based disparate treatment and a race-based hostile work environment. It also asserted claims under Title VII, the federal employment-discrimination statute, for race- and national-origin-based disparate treatment, disparate impact, and hostile work environment. Certain plaintiffs asserted individual retaliation claims under § 1981 and/or Title VII.

Plaintiffs sought permission to file a second amended complaint. The proposed amendments included a new § 1981 class claim for a citizenship-based hostile work environment, changes involving existing plaintiffs’ Title VII class claims, and the addition of fifteen new named plaintiffs. Some of the proposed new plaintiffs also sought to assert individual, non-class retaliation claims.

Legal standard

Federal Rule of Civil Procedure 15 generally allows a complaint to be amended when justice requires. Courts consider factors including delay, bad faith, repeated failure to correct deficiencies, prejudice to the opposing party, and whether the amendment would be futile. Prejudice to the opposing party carries the greatest weight.

When an amendment adds new parties, the court must also consider the rules governing joinder. Rule 20 permits people to join as plaintiffs when their claims arise from the same transaction, occurrence, or series of transactions or occurrences, and when they share a question of law or fact. Because this case involves proposed class claims, Rule 23 was also relevant to adding plaintiffs to those claims.

Court’s analysis

The defendants did not oppose amendments concerning the existing thirteen named plaintiffs. The court therefore granted the motion as unopposed as to those plaintiffs.

The court granted the motion as to the fifteen proposed new plaintiffs to the extent they asserted the same claims on behalf of themselves and a putative class. The court recognized that the proposed plaintiffs alleged a company-wide pattern and practice of discrimination and a hostile work environment, and concluded that the defendants’ arguments about whether the new plaintiffs were representative of the class or had claims in common were better addressed at the class-certification stage. The court also found that the defendants had not persuasively shown that adding the plaintiffs would cause meaningful discovery-related delay or other prejudice. This ruling was without prejudice to further consideration of case-management issues as the litigation progressed.

The court denied the motion as to the proposed new plaintiffs’ individual, non-class claims. The proposed individual retaliation claims involved different complaints, employment positions, departments, alleged retaliatory actions, and other individualized facts. The court concluded that the claims did not arise from the same transaction or occurrence as required by Rule 20 and that the plaintiffs had not shown that joinder was proper. The court also found plausible concerns about the burden of defending against the additional claims and possible jury confusion.

The court did not address a potential claim-splitting issue raised by the defendants because the parties had not briefed it. Based on the record before it, however, the court did not foresee a claim-splitting issue.

Disposition

The court granted in part and denied in part plaintiffs’ motion for leave to file the proposed second amended complaint as follows:

The court ordered plaintiffs to file the permitted second amended complaint by June 30, 2025.