Palacios v. Interstate Hotels & Resorts Inc

Background

Mercedes Palacios brought ten causes of action against defendants, including claims for unpaid wages, discrimination, retaliation, wrongful termination, and unfair competition. The opinion identifies Interstate Management Company LLC as the company that employed Palacios, although the caption also named Interstate Hotels & Resorts Inc. Palacios worked as a room attendant for Interstate from approximately October 26, 2015, until her termination on November 5, 2019.

The seventh and eighth causes of action alleged discrimination and retaliation under California’s Fair Employment and Housing Act (FEHA). Palacios received a right-to-sue notice from the California Department of Fair Employment and Housing on January 31, 2020. She filed her complaint in California state court on February 3, 2021, and Interstate later removed the case to federal court.

Motion and arguments

Interstate moved under Federal Rule of Civil Procedure 12(b)(6), which allows dismissal when a complaint does not legally support a claim. Interstate argued that Palacios’s FEHA claims were filed more than one year after the right-to-sue notice and therefore were untimely.

Palacios did not dispute that the ordinary one-year deadline would apply, but argued that California Judicial Council Emergency Rule 9 paused the deadline because of the COVID-19 pandemic. Emergency Rule 9 tolled, or paused, civil statutes of limitations longer than 180 days from April 6, 2020, through October 1, 2020.

Court’s analysis

The court explained that FEHA generally gives a claimant one year from the date of the right-to-sue notice to file a civil action. It concluded that Emergency Rule 9 was broadly written to apply to civil causes of action filed in court. The court rejected Interstate’s argument that the rule did not cover the FEHA deadline because California Government Code provisions were not specifically listed in an accompanying memorandum.

The court distinguished the memorandum’s exclusion for deadlines involving the submission of claims to government entities. It found that this exclusion did not apply to filing a civil action in court. Applying Emergency Rule 9, the court determined that the rule extended Palacios’s filing deadline and that her FEHA claims were timely.

Disposition

The court denied Interstate’s motion to dismiss. The order addressed Interstate’s request to dismiss Palacios’s seventh and eighth causes of action; it did not state that the entire case was dismissed or otherwise resolve Palacios’s remaining claims.