Atakilti v. Bayer U.S. LLC

Background

Hiwot Atakilti sued Bayer U.S. LLC, Steven Flint, and Yaengsaeng Xayavong in Alameda County Superior Court. She alleged state-law claims for racial discrimination, gender discrimination, marital-status discrimination, racial harassment, failure to prevent and investigate discrimination, retaliation, an Equal Pay Act violation, and constructive discharge and wrongful termination.

The defendants removed the case to federal court based on diversity jurisdiction, which generally requires the parties to be citizens of different states and an amount in controversy exceeding $75,000. Atakilti and the two individual defendants, Flint and Xayavong, reside in California. Bayer is a Delaware corporation with its principal place of business in Pittsburg, Pennsylvania.

The defendants argued that Flint and Xayavong had been fraudulently joined. In this context, fraudulent joinder means claiming that a non-diverse defendant was added only to prevent federal jurisdiction and that there is no possibility of stating a claim against that defendant in state court. Atakilti moved to remand, or return, the case to state court.

Court’s analysis

The court explained that removal jurisdiction is narrowly construed and that defendants bear the burden of establishing it. Because the complaint raised no federal questions, federal jurisdiction depended on complete diversity. If there was a possibility that Atakilti could state a claim under California law against a non-diverse defendant, remand was required.

The court focused on Atakilti’s potential racial-harassment claim against Xayavong under California’s Fair Employment and Housing Act. The court distinguished discrimination from harassment. Under the statute, discrimination claims can be brought against an employer, while harassment claims can be brought against an employer or an individual employee. Discrimination generally involves official employment actions, such as performance reviews, salary decisions, and hiring or termination decisions. Harassment can involve hostile interpersonal conduct that is unnecessary to job performance, including derogatory remarks and exclusion from workplace social events.

The court found that Atakilti’s allegations could support a harassment claim against Xayavong. Atakilti alleged that, from 2019 to 2020, Xayavong publicly downplayed her work, suggested that she was incapable of performing it, blamed her for coworkers’ performance problems, and said during meetings that she did not know what she was doing. The court stated that repeatedly singling out and criticizing an employee in front of colleagues could communicate hostility beyond ordinary supervision. It also noted allegations that Xayavong denied a vacation request and failed to plan Atakilti’s work-anniversary event while planning events for other employees.

The court further concluded that the alleged multi-year pattern of different pay, fewer opportunities, more critical reviews, and less favorable treatment compared with non-African American coworkers could suggest that the conduct was based on race. The court rejected the defendants’ focus on the allegedly neutral nature of the personnel actions because it did not account for the alleged public and repeated ridicule.

Disposition

The court expressly stated that it was not holding that the complaint actually stated a racial-harassment claim against Xayavong. It held only that the complaint could state such a claim. Because the defendants had not shown that Xayavong was fraudulently joined, the court granted Atakilti’s motion to remand the action to the Superior Court for the State of California, County of Alameda. The court did not consider whether Atakilti could state a claim against Flint because its ruling concerning Xayavong alone required remand.