Tuens v. U.S. Bank National Association

Background

Tracy Tuens alleged that U.S. Bank hired her in May 2016 as a Managing Director, Client Advisory, in its Ascent Private Capital Management division. She alleged that she was hospitalized with a serious medical condition in December 2016, took medical leave until March 2017, and informed her supervisor, Martim L. De Arantes Oliveira, about her medical limitations.

Tuens alleged that U.S. Bank later placed her on performance plans, did not adequately consider her request for a reasonable accommodation, and terminated her employment on March 3, 2018. She also alleged that Oliveira rejected potential business prospects and told her, “you don’t really want to do this anymore . . . how about you retire . . . finance is a tough and dirty business.” She claimed that she was replaced by a younger, nondisabled male employee whose sales performance was worse but who was not disciplined or terminated.

Tuens sued U.S. Bank National Association, U.S. Bancorp, and Oliveira in San Francisco County Superior Court. Her complaint asserted twelve claims, including claims under California’s Fair Employment and Housing Act for disability, age, and gender harassment, as well as a claim for intentional infliction of emotional distress. She named Oliveira in those four claims. U.S. Bank removed the case to federal court under the federal diversity-jurisdiction statute, and U.S. Bank and Oliveira filed motions to dismiss under Rule 12(b)(6), which allows dismissal for failure to state a legally sufficient claim.

Jurisdiction and fraudulent joinder

Before considering the motions to dismiss, the court first examined its subject-matter jurisdiction, meaning its legal authority to hear the case. Diversity jurisdiction generally requires every plaintiff to be a citizen of a different state from every defendant. The opinion states that Tuens and Oliveira are both California citizens.

U.S. Bank argued that Oliveira had been improperly or fraudulently joined because Tuens had not stated a valid claim against him. The court explained that fraudulent joinder requires a heavy showing. If there is any possibility that a state court could find that the complaint states a claim against the resident defendant, the federal court must treat the joinder as proper and remand the case to state court.

Claims against Oliveira

The court concluded that Tuens had not adequately stated claims against Oliveira for disability, age, or gender harassment under the Fair Employment and Housing Act. The court found that Oliveira’s alleged retirement remark had no plausible connection to Tuens’s gender or disability and that, although it could relate to her age, a single remark was insufficient by itself to establish actionable harassment.

The court also determined that the employment actions Tuens described—such as performance plans, decisions about business opportunities, and termination—did not establish a widespread pattern of bias or otherwise communicate a hostile message in the circumstances alleged. The court further found that the allegations did not support applying the continuing-violation doctrine, which can sometimes connect conduct outside a filing deadline to related conduct within the deadline.

However, the court found a possibility that Tuens could plead additional facts making her harassment claims against Oliveira viable. Because the court viewed the possibility of a state-law claim as enough to defeat the fraudulent-joinder argument, it also found a possibility that Tuens could state an intentional-infliction-of-emotional-distress claim against Oliveira. The court therefore concluded that Oliveira’s joinder was proper for purposes of deciding federal jurisdiction.

Order

The court ordered the defendants to show cause—meaning to explain—why the case should not be remanded to San Francisco Superior Court. Defendants’ written response was due October 19, 2020, and any response to that filing was due November 2, 2020. The court stated that, unless otherwise ordered, it would decide remand without a hearing and would remand the case if no timely response opposing remand was filed.

The court did not reach the merits of the motions to dismiss. It terminated both motions without prejudice to consideration by the appropriate court and vacated the scheduled case-management conference.