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California Rules on Exhaustion of Remedies Requirement to File Wrongful Termination of Employment Claim

When people in California are the victims of illegal workplace discrimination, they can file claims against their employers under the Fair Employment and Housing Act. However, before they can file lawsuits, they must first exhaust the administrative remedies available to them through the Department of Fair Employment and Housing. This process is started by naming the defendants in a verified complaint with the DFEH. In Clark v. Super. Ct. , Cal. Ct. App. Case No. D077711, the appeals court considered a case in which the claimant had named the defendant by its "doing business as" name instead of its legal name in her discrimination charge to determine whether that was sufficient to exhaust her administrative remedies.[1]

Factual and Procedural Background

Alicia Clark worked for Arthroscopic Laser Surgery Center of San Diego, L.P., or ALSC. The company was doing business as Oasis Surgery Center. Clark filed a complaint with the Department of Fair Housing and Employment, alleging multiple discrimination claims against her former employer. She complained that ALSC had discriminated against her based on sexual orientation, race, and sex and also complained that the company harassed and unlawfully retaliated against her. Her DFEH complaint named her former employer as Oasis Surgery Center instead of its legal name, ALSC. She also named two supervisors by their names. The DFEH issued her a right to sue letter, and she filed a civil complaint in the Superior Court of California against Oasis Surgery Center. She subsequently filed an amendment changing the name to the company's correct legal name of ALSC.

ALSC filed a motion for summary judgment with the Superior Court, arguing that Clark had failed to exhaust her administrative remedies with the DFEH before filing a civil lawsuit against the company. The defendant argued that she had not exhausted her administrative remedies because she had filed her original discrimination complaint against Oasis Surgery Center instead of against ALSC. The defendant argued that the law required her to exhaust her administrative remedies with the DFEH against the correctly named legal entity and not its "doing business as" name.

Clark filed a motion to oppose ALSC's motion for summary judgment. She argued that while she listed the company's "doing business as" name instead of its legal entity name, her complaint with the DFEH clearly identified ALSC, its contractors, and employees. She argued that ALSC had not suffered any harm from Clark's using the company's "doing business as" name in the DFEH complaint since the agency did not serve the complaint on any party but instead issued a right to sue letter and directed Clark to perform the service and investigation on her own. She argued that she was a layperson and the fact that she did not understand that she was required to use the company's legal entity name instead of its DBA name did not mean that she failed to exhaust her administrative remedies and that the motion for summary adjudication should be denied.

The trial court granted ALSC's motion for summary adjudication of Clark's FEHA claims following a telephonic hearing in June 2020. The court found that since Clark had named the wrong entity in her DFEH complaint, she had failed to exhaust her administrative remedies through the agency before filing her lawsuit.

Clark filed a petition for a writ of mandate with the California Court of Appeal, asking the appellate court to vacate the trial court's order granting summary adjudication to ALSC.

Issue: Whether failing to use the defendant's legal entity name in a DFEH complaint meant that Clark had failed to exhaust her administrative remedies even though she had been issued a right-to-sue letter?

In Clark's petition for a writ of mandate, she argued that the trial court erroneously granted ALSC's motion for summary adjudication based on her using the company's DBA name in her DFEH complaint. Clark argued that under state and federal law when a reasonable investigation would have resulted in the agency identifying the correct employer, the administrative remedies are exhausted.

The appeals court asked ALSC to file a response to Clark's petition for a writ of mandate. In its response, it again stated that she had failed to exhaust her administrative remedies by not naming the company by its legal name in her complaint.

Rule: Complainants may file DFEH complaints about discrimination by including the name and address of the defendants in a verified complaint with the DFEH.

Under Cal. Gov. Code § 12960, people must file verified complaints that include the names and addresses of the employers they allege have violated the discrimination provisions under the Fair Employment and Housing Act with the DFEH.[2] Under Cal. Gov. Code § 12965, the DFEH will issue a right-to-sue letter if it does not bring a claim against an employer within 150 days or when it determines that it will not investigate a claim.[3] The right to sue letter provides claimants with the right to file a lawsuit against the employers named in the DFEH complaint. ALSC argued that since Clark did not name it by its legal name in her DFEH complaint, that meant she had not exhausted her administrative remedies as required by the law.

Analysis

The appeals court began by noting that under 2 CCR § 10003, the DFEH must liberally construe complaints that are filed with the agency to accomplish the purposes of the Fair Employment and Housing Act against discrimination.[4] It then stated that exhaustion of administrative remedies is required in California before people can file lawsuits based on discrimination against their employers. The administrative remedies are those provided by the DFEH after a complaint is filed with the agency.

The court then considered the FEHA exhaustion standard. In Valdez v. City of Los Angeles , 231 Cal.App.3d 1043(1991), the court found that failing to name a defendant in a FEHA complaint is unfair and means that the complainant has not exhausted the administrative remedies.[5] The court noted that several cases following that decision had found that failing to name the defendant in the caption or body of a complaint means that the administrative remedies have not been exhausted.

The court distinguished Valdez and its progeny in Martin v. Fisher, 11 Cal.App.4th 118 (1992). In that case, the court found that since the claimant had named the defendant in her discrimination charge but not in the case caption, she could still pursue a civil lawsuit.[6]

The court then considered Clark's case. It first noted that since Clark had requested an immediate right-to-sue letter from the DFEH, she did not have an administrative remedy to exhaust. The court then noted that ALSC was clearly identifiable as the defendant since Clark named ALSC's DBA name in her discrimination charge and complaint. Within the body of her complaint, she also named her coworkers, supervisors, managers, and dates of employment with the company. It found that if the DFEH had conducted an investigation, it would have readily identified ALSC as the appropriate party. This meant that if Clark had chosen to pursue the administrative remedy by allowing the DFEH to investigate instead of asking for an immediate right-to-sue letter, she would have exhausted her administrative remedies even though she filed her discrimination charge under the company's DBA name instead of its legal name.

Conclusion

The appeals court found that Clark properly exhausted her administrative remedies and that the exhaustion standard was not meant to be used as a "gotcha" tool to prevent lawsuits based on mere technicalities. The court issued a writ of mandate to the trial court to vacate its summary adjudication order and allow Clark's lawsuit to proceed.

Talk to an Experienced Discrimination Attorney in Los Angeles

If you believe that you have been the victim of unlawful discrimination at your workplace, you must first file a charge with the DFEH before you can file a lawsuit in court. An attorney at the law firm of Steven M. Sweat, APC can review what happened and help you to meet the requirements for filing your charge. Contact us today to schedule a free consultation by calling 866.966.5240.

Sources

[1] Clark v. Super. Ct.

[2] Cal. Gov. Code § 12960

[3] Cal. Gov. Code § 12965

[4] 2 CCR § 10003

[5] Valdez v. City of Los Angeles

[6] Martin v. Fisher

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