Opinion
No. C 01-0544 MMC
February 14, 2002
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT; VACATING HEARING
Before the Court is defendant Avemco Insurance Company's motion for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. Plaintiff Claude J. Wilson has filed opposition, to which defendant has replied. Having considered the papers filed in support of and in opposition to the motion, the Court deems the motion appropriate for decision on those submissions, VACATES the hearing scheduled for February 15, 2002, and rules as follows.
BACKGROUND
Plaintiff, an FAA certified commercial pilot, was born on November 20, 1920. (See Eisenreich Decl. Ex. G at 2.) On April 24, 1998, plaintiff requested that defendant, an insurer, provide him with a insurance quote for "single pilot" use of a "C-90 King Air" aircraft. (See id. Ex. M at 4.) On June 3, 1998, defendant sent plaintiff an insurance quote for the aircraft, but noted that "a pilot-in-command with co-pilot is required for all in flight operation of your insured aircraft." (See id. at 9-15.) On June 7, 2000, plaintiff responded to defendant's quote by asking for clarification of the co-pilot requirement and including "an expanded pilot resume." (See id. at 16-25.) On July 9, 1998, defendant replied, stating that the co-pilot requirement was "an insurance requirement" and that defendant could not provide insurance without that condition. (See id. at 27.) On July 13, 1998, plaintiff requested that defendant provide the reason for the co-pilot requirement. (See id. at 28.) On July 21, 1998, defendant answered plaintiff's inquiry as follows: "Our underwriting guidelines do not permit single pilot operations for pilots over the age of 68 in turboprop aircraft." (See id. at 29.)
On February 15, 1999, plaintiff filed a claim with the Department of Insurance, requesting that the Department of Insurance issue an order that "defendant eliminate any underwriting policies that provide age alone limitations to providing insurance coverage" and "[i]nvestigate this claim as a violation of the Unruh Act." (See id. Ex. G.) On June 23, 1999, the Department of Insurance, after conducting an investigation, advised plaintiff of its findings:
[Defendant's] decision was not based solely on age, it is based upon the performance nature of the aircraft plus age. It does not appear to be an arbitrary misuse of age that the Unruh Act proscribes. This does not appear to be an unreasonable application of the underwriting rules and policies.
I regret that this department is not able to be of more assistance in this matter.
(See id. Ex. H.)
On July 7, 1999, plaintiff filed a claim with the Department of Fair Employment and Housing ("DFEH"); on December 22, 1999, the DFEH closed the case. (See Def.'s Separate Statement of Undisputed Facts, Nos. 36, 38.)
Neither party offers a copy of plaintiff's DFEH claim or the DFEH's response thereto. Plaintiff, in his Objection to Defendant Avemco Insurance Company's Separate Statement of Undisputed Facts, does not dispute that he filed a claim with the DFEH on July 7, 1999 or that the DFEH closed the case on December 22, 1999.
Thereafter, plaintiff filed a claim with the Department of Justice. On August 23, 2000, the Department of Justice notified defendant that plaintiff had filed a claim asserting that plaintiff had been denied insurance solely due to his age in violation of the Unruh Act, and requested that defendant provide a response to plaintiff's claim. (See Eisenreich Decl. Ex. J.) On May 18, 2001, the Department of Justice, having considered defendant's response to plaintiff's claim, concluded that "we are not going to pursue this investigation any further at this time." (See id. Ex. L.)
Neither party has filed a copy of the claim plaintiff filed with the Department of Justice nor provided any evidence as to when that claim was filed.
Meanwhile, on December 19, 2000, plaintiff filed the instant action, alleging five causes of action, all of which contend that defendant's "co-pilot" requirement constituted unlawful discrimination on the basis of age. Plaintiff's First and Second Causes of Action arise under the Unruh Act, Cal. Civ. Code §§ 51 and 51.5. Plaintiff's Third and Fourth Causes of Action arise under the Cartwright Act, Cal. Civ. Code §§ 16720 et seq. Plaintiff's Fifth Cause of Action arises under § 125.6 of the California Business Professions Code.
LEGAL STANDARD
Rule 56(c) of the Federal Rules of Civil Procedure provides that a court may grant summary judgment "if the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law."
The Supreme Court's 1986 "trilogy" of Celotex Corp. v. Catrett, 477 U.S. 317 (1986), Anderson v. Liberty Lobby, Inc., 477 U.S. 242 (1986), and Matsushita Electric Industrial Co. v. Zenith Radio Corp., 475 U.S. 574 (1986), requires that a party seeking summary judgment show the absence of a genuine issue of material fact. The moving party need not produce admissible evidence showing the absence of a genuine issue of material fact when the nonmoving party has the burden of proof, but may discharge its burden simply by pointing out that there is an absence of evidence to support the nonmoving party's case. See Celotex, 477 U.S. at 324-25. Once the moving party has done so, the nonmoving party must "go beyond the pleadings and by her own affidavits, or by the `depositions, answers to interrogatories, and admissions on file,' designate `specific facts showing that there is a genuine issue for trial.'" See id. at 324 (quoting Rule 56(c)). "When the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita, 475 U.S. at 586. "If the evidence is merely colorable, or is not significantly probative, summary judgment may be granted." Liberty Lobby, 477 U.S. at 249-50 (citations omitted). When determining whether there is a genuine issue for trial, "inferences to be drawn from the underlying facts . . . must be viewed in the light most favorable to the party opposing the motion." See Matsushita, 475 U.S. at 587 (quotingUnited States v. Diebold, Inc., 369 U.S. 654, 655 (1962)).
DISCUSSION
A. Jurisdiction
A person alleging a violation of the Unruh Act may file a civil complaint. See Cal. Civ. Code § 52. Defendant argues, however, that the Court lacks jurisdiction over the particular type of Unruh Act claim at issue.
Defendant relies on Wilson v. Fair Employment and Housing Comm'n, 46 Cal.App.4th 1213 (1996), in which the California Court of Appeal concluded that the Fair Employment and Housing Commission ("FEHC") lacked jurisdiction to consider the merits of an administrative claim that an insurer had, with respect to an underwriting decision, engaged in age discrimination in violation of the Unruh Act. Rather, the court inWilson held the claim must be presented "for hearing and determination by the Insurance Commissioner." See id. at 1221-22. Wilson, however, did not address the issue of whether a plaintiff could raise such a claim by way of a civil complaint. See id. at 1224 n. 7 ("We do not address the possibility of a complaint filed directly with the court without prior administrative action.")
Defendant also relies on Walker v. Allstate Indemnity Co., 77 Cal.App. 4th 750 (2000). Walker likewise is distinguishable. InWalker, the court held that the plaintiffs' suit challenging allegedly excessive insurance rates under the Unfair Practices Act was barred by California Insurance Code §§ 1860.1 and 1860.2, where those rates had been approved by the Insurance Commissioner. Rather, the plaintiffs, according to Walker, were limited to filing a petition for a writ of administrative mandamus to review the Commissioner's decision. See id. at 753-54. The instant action, by contrast, does not involve a challenge to the Insurance Commissioner's ratemaking decisions.
By contrast, in Beaty v. Truck Ins. Exchange, 6 Cal.App.4th 1455 (1992), the California Court of Appeal did address that very issue, holding that a plaintiff can pursue a civil complaint and is not limited to seeking administrative relief from the Insurance Commissioner. See id. at 1458-59, 1466 n. 6 (holding plaintiffs who alleged insurer violated Unruh Act by discriminating on basis of sexual orientation and marital status were not limited to remedies provided by California Insurance Code). Additionally, the Department of Insurance itself has indicated that plaintiff herein is not limited to seeking relief from that department. In its response to plaintiff's administrative claim, the Department stated: "Any determination of damages would be a civil matter and should be addressed by a court of law. . . . While this department may have primary jurisdiction we do not have sole jurisdiction, therefore, you may wish to consult with an attorney or to seek other judicial remedies." (See Def.'s Req. for Judicial Notice Ex. N.).
Accordingly, plaintiff is not limited to filing an administrative claim with the Insurance Commissioner and, thus, the Court has jurisdiction over plaintiff's claims.
The Court has previously determined that it has diversity jurisdiction over plaintiff's claims. (See Order Denying Plaintiff's Motion to Remand, filed on May 11, 2001.)
B. Statute of Limitations
As noted, the instant action was filed on December 19, 2000. Defendant argues that all of plaintiff's claims are time-barred because (1) the claims accrued on July 23, 1998; (2) the claims are subject to a one-year statute of limitations; and (3) plaintiff cannot establish entitlement to equitable tolling.
1. Accrual
Defendant argues that plaintiff's claims accrued on July 23, 1998, the date defendant notified plaintiff that its "underwriting guidelines do not permit single pilot operations for pilots over the age of 68 in turboprop aircraft." (See Eisenreich Decl. Ex. M at 29.) In opposition, plaintiff argues: "Defendant's discrimination is ongoing. Today they refuse to insure a turboprop aircraft (as well as other types) if it is piloted by a qualified pilot over the age of 68 years." (See Plaintiff's Opp. at 3:25-4:3.) Plaintiff thus appears to rely on the "continuing violation doctrine" to establish that his claims accrued after July 23, 1998.
In Richards v. CH2M Hill, Inc., 26 Cal.4th 798 (2001), the California Supreme Court addressed the "continuing violation doctrine" in the context of an employment discrimination action involving an alleged failure to accommodate the employee's disability. The Court explained that "when an employer engages in a continuing course of unlawful conduct . . ., the statute of limitations begins to run not necessarily when the employee first believes that his or her rights may have been violated, but rather, either when the course of conduct is brought to an end, as by the employers cessation of such conduct or by the employee's resignation, or when the employee is on notice that further efforts to end the unlawful conduct will be in vain." See id. at 824.
The circumstances presented in Richards, and the policies implicated thereby, are distinguishable from those presented in the instant action. Here, the undisputed evidence establishes that defendant engaged in one allegedly unlawful act, specifically, declining to provide plaintiff with "single pilot" insurance for an unlawful reason. There is no ongoing relationship between the parties, let alone an employment relationship. Moreover, defendant's letter of July 21, 1998 explicitly informed plaintiff of defendant's age-based criteria. Although plaintiff alleges that defendant's decision has had a continuing effect on him, in that plaintiff has endured "lost opportunity costs, lost income [and] loss of reputation" (see Compl. at ¶ 12), the doctrine is applicable only to continuing "violations," not to continuing "effects." See, e.g., McDougal v. County of Imperial, 942 F.2d 668, 675-75 (9th Cir. 1991) (holding where plaintiffs alleged "continuing impact from past violations" of federal civil rights laws, continuing violation doctrine was inapplicable).
Accordingly, plaintiff's claims accrued on or about July 23, 1998.
2. Length of Statutory Period
Plaintiff's First and Second Causes of Action, alleging violations of the Unruh Act, are subject to a one-year statute of limitations. See West Shield Investigations v. Superior Court, 82 Cal.App.4th 935, 953 (2000) (holding Unruh Act claims subject to one-year statute of limitations). Plaintiff's Fifth Cause of Action, alleging a violation of § 125.6 of the California Business Professions Code, likewise is subject to a one-year statute of limitations. Section 125.6 provides that a licensee under the Code, who discriminates with respect to providing the licensed activity, is "subject to disciplinary action." See Cal. Bus. Prof. Code § 125.6; see, e.g., Easebe Enterprises, Inc. v. Rice, 141 Cal.App.3d 981 (1983) (affirming decision by Alcohol Beverage Control Appeals Board to revoke liquor license of business establishment that discriminated on basis of sex). The statute of limitations for an "action upon a statute for a penalty or forfeiture" is one year. See Cal. Civ. Proc. Code § 340(1).
Defendant does not argue that plaintiff lacks standing to seek relief under § 125.6. In light of the Court's finding, discussedinfra, that any claim under § 125.6 is barred by the statute of limitations, the Court does not consider whether plaintiff, as a private party, has standing to bring an action pursuant to § 125.6.
Because plaintiff filed the instant action more than one year after July 21, 1998, plaintiff's First, Second, and Fifth Causes of Action are subject to dismissal absent equitable tolling of the statute of limitations.
Plaintiff's Third and Fourth Causes of Action, however, are not barred by the statute of limitations. Plaintiff's Third Cause of Action, alleging a violation of § 16721 of the California Business of Professions Code, arises under the Cartwright Act. See Warden v. Younger, 428 F. Supp. 64, 65 (N.D. Cal. 1977) (noting § 16721 is part of "the Cartwright Act, California's antitrust law"). Plaintiff's Fourth Cause of Action, entitled "Restraint of Trade," also appears to arise under the Cartwright Act. A claim arising under the Cartwright Act is subject to a four-year statute of limitations. See Cal. Bus. Prof Code § 16750.1.
In its motion, defendant indicates that it has construed plaintiff's Fourth Cause of Action as claiming a violation of the Cartwright Act. In his opposition, plaintiff does not take issue with that characterization.
3. Equitable Tolling
Plaintiff argues that his claim is timely because he is entitled to "rely on the `right-to-sue' letter dated December 22, 1999 from the Department of Fair Employment and Housing (DFEH) . . . ." (See Pl.'s Opp. at 19:16-17.)
In Elkins v. Derby, 12 Cal.3d 410 (1974), the California Supreme Court held that "the running of the statute of limitations is tolled when an injured person has several legal remedies, and, reasonably and in good faith, pursues one." See id. at 414. In Elkins, the plaintiff, who was injured while working at defendant's workplace, "reasonably and in good faith filed a timely claim for benefits with the Workmen's Compensation Appeals Board." See id. at 412. After that application was denied on the basis that plaintiff was not an "employee" at the time of the injury, plaintiff filed a personal injury action seeking recovery for the same injury after the applicable statute of limitations had run. Under those circumstances, the California Supreme Court held that the statute of limitations was tolled from the date the plaintiff filed his application for workers' compensation benefits until the date the denial of his application became final. See id. at 412 ("[T]he statute may properly be tolled for the period during which plaintiff pursued his compensation remedy.")
Here, plaintiff filed an administrative claim with the Department of Insurance on February 15, 1999, approximately six and a half months from the date his claims accrued. There is no indication plaintiff acted other than reasonably and in good faith with respect to the filing of that claim, see Wilson, 46 Cal.App.4th at 1222 (holding "administrative claims by persons allegedly aggrieved by an underwriting rule are to be submitted to the Insurance Commissioner"), and defendant had notice of the claim within the limitations period. See Elkins, 12 Cal.3d at 417-18 ("Defendants' interest in being promptly apprised of claims against them in order that they may gather and preserve evidence is fully satisfied when prospective tort plaintiffs file [administrative] claims within one year of the date of their injuries.") Accordingly, the one-year statute of limitations was tolled during the period that plaintiff's administrative claim was pending before the Department of Insurance. The one-year period began to run again on June 23, 1999, when the Department of Insurance denied plaintiff's administrative claim. Approximately two weeks later, on July 7, 1999, plaintiff filed an administrative claim with the DFEH.
Relying on Wilson, defendant argues that plaintiff should have known that the DFEH did not have jurisdiction to provide him a remedy and, thus, plaintiff is not entitled to equitable tolling during the time his DFEH claim was pending. As discussed above, in Wilson, the California Court of Appeal held that an administrative claim alleging that an insurer has discriminated on the basis of age in its underwriting practices must be submitted to the Department of Insurance and may not be submitted to any other agency. See id. at 1222 ("[W]e do not believe that Wilson's administrative claim is properly submitted to another agency, such as the FEHC.") Because plaintiff herein was also the plaintiff inWilson, plaintiff's attempt to file a claim with the DFEH cannot be considered "reasonable." Plaintiff argues that Wilson held that the FEHC lacked jurisdiction, not that the DFEH lacked jurisdiction. As noted, however, Wilson unambiguously held that the very type of administrative claim Wilson submitted to the DFEH on July 7, 1999, was not properly submitted to any "agency" other than the Insurance Commissioner. Consequently, plaintiff is not entitled to equitable tolling for the period his claim was pending before the DFEH.
The DFEH and the FEHC are both part of the same "agency," the State and Consumer Services Agency. See Cal. Gov't Code §§ 12901, 12903.
As of June 23, 1999, approximately five and a half months of the one-year limitations period remained. The time period in which plaintiff was required to file his First, Second, and Fifth Causes of Action thus expired in December 1999, at least a year before the complaint in the instant action was filed.
Although plaintiff also filed an administrative claim with the Department of Justice, plaintiff offers no evidence as to when that claim was filed, nor does plaintiff rely on that claim to establish equitable tolling.
Accordingly, defendant is entitled to summary judgment on plaintiffs' First, Second, and Fifth Causes of Action.
C. Cartwright Act
Defendant argues that plaintiff cannot establish that he has standing to bring his claims under the Cartwright Act.
In Kolling v. Dow Jones Co., 137 Cal.App.3d 709 (1982), the California Court of Appeal held that, in order to have standing to bring an antitrust claim, the plaintiff must be "within the `target area' of the antitrust violation" and must have suffered "antitrust injury." See id. at 723. To establish an antitrust violation based on restraint of trade, a plaintiff must show "a combination of two or more persons by concerted action to accomplish a crime or unlawful purpose." See G.H.I.I. v. MTS, Inc., 147 Cal.App.3d 256, 266 (1983); see also Cal. Bus. Prof Code § 16721(c) ("Any violation of any provision of this section is a conspiracy against trade"). Put another way, "[a]n antitrust case must be based upon conspiratorial conduct rather than unilateral conduct." See G.H.I.I., 147 Cal.App.3d at 268.
Defendant argues that plaintiff cannot prove "antitrust injury" because plaintiff does not allege any injury based upon a combination or conspiracy, but rather upon unilateral conduct on the part of defendant. In opposition, plaintiff offers no evidence as to the existence of "a combination of two or more persons by concerted action." Rather, plaintiff argues that defendant's co-pilot requirement "restrains his ability to exercise certificated FM flight instructors' rating." (See Pl.'s Opp. at 20:9-13.) Any such "restraint," however, is the result of unilateral rather than concerted action. Under such circumstances, plaintiff lacks standing to bring a claim under the Cartwright Act.
Accordingly, defendant is entitled to summary judgment on plaintiff's Third and Fourth Causes of action.
CONCLUSION
For the reasons stated above, defendant's motion for summary judgment is hereby GRANTED.
The Clerk shall close the file and terminate all pending motions.